As the U.S. Food and Drug Administration continues to crack down on manufacturers in China and India, the agency looks set to add at least 5 inspectors to the subcontinent to rein in cases of fake drugs and falsified tests that have already cost India millions of dollars in lost sales.
At the same time, the FDA has put several Chinese bulk drug manufacturers on watchlists for contaminated products.
The FDA currently has two full-time inspectors for China's 708 plants and three inspectors for 850 plants in India, but "headquarters is planning to add 5 more inspectors to look after the Indian drug units considering the presence of almost 900 plants exporting drugs to the U.S.," two senior FDA officials in India told the Hindustan Times newspaper in a report this week.
FDA officials in Washington however said the agency was "not in a position" to discuss staffing levels in India, but did say the regulator was "awaiting the deployment" of three additional inspectors for its China operations.
The agency has already raised fees for drug approvals to $76,030 from $58,730 and analysts say this means the agency plans to use the extra revenue to beef up its resources overseas. FDA officials also told the newspaper that despite the low number of in-country inspectors, U.S.-based reviewers often travel to foreign facilities.
The agency is under pressure from Congress to strengthen its inspections of China and India drug manufacturing and U.S. representatives have written to the Government Accountability Office asking it to look into the agency's inspection program, saying there was "inadequate oversight" of foreign drug plants.
China has been particularly reluctant to acquiesce to the FDA's moves to increase inspections and has balked at providing visas for new inspectors.
In India, the FDA's recent tougher measures have caught several manufacturers falling short of international standards and resulted in warning letters or outright bans on drugs being exported to the U.S. from certain plants.
The moves have also crimped stocks of the companies in trouble, with the most recent, Cadila Healthcare, suffering a 17% selloff in its shares last week after the FDA issued it another warning letter over two of its plants that had been cited previously.
Sun Pharmaceutical shares have also lost at least a third of their value since April and Dr. Reddy's ($RDY) shares have fallen by more than a quarter in the last two months after those companies fell short on the FDA checklist. Sun inherited several troubled plants when it acquired Ranbaxy for $4 billion last March and is still working to remediate the problems.