On 23 April, Lupin announced that its formulation facility Indore Unit-2 has been classified as Official Action Indicated (OAI) following the inspection conducted by the US FDA in January 2019. The OAI could potentially lead to no new approvals from the site. The site is already under a warning letter. The January 2019 inspection led to six Form 483 observations. The outcome of the inspection is not entirely a surprise. The FDA\u2019s comments on the Out of Specification (OOS) investigation and employee training\/competency were areas of concern for us. Lupin was issued a warning letter at its formulation sites at Goa and Indore Unit-2 in Nov 2017. The warning letter highlighted deficiencies in the investigation of OOS results and hold time studies. The observations surrounding the OOS results in the January 2019 inspection were a repeat of the issues mentioned in the warning letter. The January 2019 inspection 483 mentioned several OOS observations during the testing of environmental monitoring, which were attributed to human error. Examples of discrepancies in the statements made by a company analyst between what was mentioned during the time of the OOS investigation by the company and during the inspection were highlighted. The inspector therefore raised concerns on the abilities of the lab personnel to properly conduct tests. We found a high frequency of invalidation of OOS results attributed to analyst error and lack of training\/competency of personnel involved were mentioned in the inspection observations across multiple sites in the recent past. Besides Indore Unit-2, similar observations were made at the Mandideep and Somerset facilities during inspections held in December 2018. Both these sites are also classified as OAI. The issue appears to be systemic and would require Lupin to make requisite changes across sites, in our view. Lupin\u2019s regulatory issues have escalated, with four of its plants currently classified as OAI. The Goa formulation facility was inspected in February 2019 and we expect the inspection classification to be known over the next 15-20 days.