Aurobindo Pharma under pressure

Aurobindo Pharma is under some major selling pressure today. The stock price slipped 5.5% to Rs.590 from Friday’s close of Rs.624.10. It has recouped a but remains around Rs.600.

The stock price is reeling from the news that its Unit n.4, which was under FDA scrutiny has got none observations. These observations pertain to cleanliness, employees training, quality control, state of equipments, computer controls, building not being free of infestation, not following the procedures as stipulated for cleaning and maintain equipments and lab controls.

These are all very serious lapses, especially given the fact that this unit makes injectibles and contributes 15% of the total exports to USA. This affects the future growth trajectory of the company has till FDA clean chit does not come in, all further approvals will also get affected.