Shares in Dr Reddy's Lab crashed around 15 per cent on Friday after the drugmaker said it has received a warning letter from US Food and Drug Administration over inadequate quality control procedures at three manufacturing plants in India. Dr Reddy's, India's second largest drugmaker by sales, was the top Nifty loser.
(Read: Dr Reddy's Gets FDA Warning on Three Drug Plants)
Two active pharmaceutical ingredient (API) manufacturing units in Srikakulam (Andhra Pradesh) and Miryalaguda (Telengana) and one oncology formulation manufacturing unit in Duvvada (Visakhapatnam in Andhra Pradesh) have received warning letters, Dr Reddy's Labs' said in a statement to the Bombay Stock Exchange.
The warning follows an inspection of these facilities by the US regulator late last year and early this year, the company added.
"We will respond with a comprehensive plan to address these observations within the stipulated time-frame of 15 days," GV Prasad, CEO of Dr Reddy's said.
The company has to respond to issues raised in the warning letter in 15 days.
The US is one of the biggest generics market for domestic drugmakers, and it contributed over 50 per cent to Dr Reddy's revenues in the June quarter.
As of 12.40 p.m., Dr Reddy's shares traded 13.7 per cent lower at Rs 3,670, under-performing the broader markets, which were flat.
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