Dr.Reddy's falls and tumbles

Currently, things do not look all that great for Dr.Reddy’s. The stock breached the lower circuit at Rs.3049.75, down 10% the moment it opened for trading. It has recouped but remains firmly in the red, the top loser on the bourses currently.

The US FDA has put out a release on its website, stating the reasons why it inspected the three facilities of Dr.Reddy’s and has shockingly pointed out several deviations from the current good manufacturing practices.

In a very strongly worded letter, the FDA has listed how its inspectors found many data manipulation issues and contamination concerns. But most troubling was the discovery of a laboratory that the FDA was never told existed  and this facility was used by Dr. Reddy's for testing drug batches, to be often shipped to the U.S. It said that several of its products had repeatedly failed tests for impurities.

The FDA inspectors also found many instances at its plant in Miryalaguda where supervisors were not keeping control over equipment and records to prevent them from being changed or destroyed. Its Oncology formulation unit at Duvvada also showed a number of violations where the FDA raised serious issued for contamination, with no standards being set and met to ensure drugs met specs for strength, quality, and purity. It said that it found that many of its employees were often not trained in how to determine which vials should be kept and which rejected.

It would be all crucial to see how Dr.Reddy’s responds to this.