Shares of Aurobindo Pharma Ltd. dropped the most in eight weeks after the U.S. regulator issued a warning letter to the drugmaker's Hyderabad facility.
The U.S. Food and Drug Administration had classified the company's active pharmaceutical ingredient manufacturing facility of unit 1 as official action indicated after its inspection from Aug. 2-12, 2021. The regulator has now issued a warning letter for the said unit, according to an exchange filing, without disclosing any details on the observations received.
A warning letter is issued if a manufacturer is found to be significantly violating federal regulations.
Aurobindo Pharma, however, said the U.S. FDA's move “will not impact the existing business from this facility”. “The company will be engaging with the regulator and is fully committed in resolving this issue at the earliest. It's also committed to maintaining the highest quality manufacturing standards at all of its facilities across the globe.”
Shares of the drugmaker fell as much as 4.40% around 10 a.m. on Friday compared with a 0.31% decline in the Nifty 50. Of the 33 analysts tracking the company, 28 maintain a ‘buy', three suggest a ‘hold' and two recommend a ‘sell', according to Bloomberg data. The 12-month consensus price target implies an upside of 25%.
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