Glenmark Pharma’s Pithampur formulation plant has received three observations after a recent USFDA inspection. The observations appear relatively benign as they relate to inadequate controls and procedures and do not relay any data integrity issues. The Pithampur plant is not a major revenue contributor but some of the newer filings are from here. GNP has received two approvals for products from this plant after the observations, which alleviates concerns over the holdback of approvals.
Maintain ‘buy’ with a Mar17 target price of `1,040.
In an inspection over 22-26 February, GNP’s Pithampur plant (near Indore) has received three 483s. The observations relate to inadequate control procedures to determine the weight variation in tablets/capsules, a lack of procedures to describe the warehousing of drug products, and inappropriate controls over computers and related systems. None of the observations questioned the integrity of clinical data or point to product contamination, implying they are relatively benign in nature.
Currently, more than 75% of GNP’s US revenue comes from the Goa plant and the balance from its Pithampur (Indore), Baddi and Buenos Aires plants; thus Pithampur does not contribute much to revenues. However, GNP’s filings for complex injectables (five filings as of FY15) and immuno suppresants (two filings as of FY15) are from this plant. In addition, some of the newer oral solids filings may also be from here.