Aurobindo Pharma tastes bitter
Aurobindo Pharma announced today morning that it has received letters from the USFDA classifying the inspections concluded at our API facilities of Unit I and XI and intermediates facility of unit IX in February 2019 as Official Action Indicated (OAI).
The company said that it has already submitted its initial response to USFDA and is sending further updates on the committed corrective actions. The company is confident that these OAI classifications will not have an impact on disruption of supplies or the revenue from operations of these facilities.
This comes on the back of its clarification issued on the 14th May over the alleged drug cartel and over pricing. It said, “"On May 10, 2019, the Attorney General of the State of Connecticut and additional Attorneys' General of various US states filed a second lawsuit in Federal Court similarly alleging that Aurobindo and other companies in the US generic drug industry had violated antitrust laws by fixing prices and allocating customers (the "Second State AG Action"). While Aurobindo is currently reviewing the Second State AG Action, we expect that we will be filing papers with the Federal Court in due course denying each of the relevant accusations."
The company does not expect this have any material impact on its operations or earnings.
The market, nevertheless is spooked. It is currently the top loser on the BSE, going down over 6.5% to Rs.676.70.