Jubilant Life Sciences' US subsidiary gets USFDA warning over adulteration of drugs

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SummaryUS FDA has said it identified significant violations in Jubilant Life Sciences practices.

question the effectiveness of your current quality system to achieve overall compliance with cGMP at your facility. It is apparent that you have not implemented a robust quality system at your firm,” the USFDA said.

The Noida-based company had informed the BSE of the warning letter on December 5, saying the facility located in the Washington contributed 7%, or R195.51 crore, to consolidated sales and 4%, or R20.72 crore, to consolidated Ebitda of the company during H1 FY14. It had reported total revenue of R2,793 crore and an Ebitda of R518 crore during the same period.

The Spokane plant is a contract manufacturing facility and Nomura analyst Saion Mukherjee said that the brokerage’s forecast of a 5% constant currency growth in FY15 and FY16 may be under risk in case the warning letter is not resolved, and new approvals are halted. “With no growth in constant currency terms, we estimate the impact on FY15-16 earnings forecasts at 2.5%,” Mukherjee wrote in a report dated December 5.

Jubilant HollisterStier’s Montreal site had also received a warning letter dated February 20, 2013, citing cGMP violations. The issues identified in the Montreal warning letter included points such as failure to thoroughly investigate any unexplained discrepancy in a batch to meet specifications any of its specifications and the company distributing finished products despite the failure of the batch to meet acceptance criteria during visual inspection.

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