WHO issues notice to Matrix Labs, may suspend products

Here is a verbatim transcript of the exclusive interview with Vikas Dandekar on CNBC-TV18. Also watch the accompanying video.

Q: Fill us in on what exactly WHO has said and how large this site is for Matrix and its products?

A: This is definitely one of the biggest and a new one. WHO has been inspecting this site and it did it in the last week of May. After that, there has been a lot of back and forth between WHO and Matrix in terms of the changes that are required. A lot of corrective actions have already been taken, but as I understand from Matrix Labs, they are not ready to speak on this because it is now so much owned by Mylan that they are not in a position to talk on what actually this means to Matrix in terms of supplies.

WHO has put a statement saying that they may consider suspension of the products, pre-qualified from this particular site and even the procurement may be suspended.

Q: Is it likely, from what you are hearing from WHO sources, that there could be any seizure of drugs or stoppage of production that could materially affect Matrix?

A: Yes, that looks to be very likely because in its Notice of Concern WHO has mentioned that there have been several rounds of communication between them and Matrix Labs. They will still probably give them some more time before they go to take the ultimate step. My source also mentioned that a similar action is expected for some other companies in addition to Matrix.

Q: Your flashes also indicate that this site mostly supplied HIV products. Is that the largest revenue contributor as well for Matrix and that this will be extremely detrimental news if there is a suspension?

A: It is one of the big revenue earners for Matrix. There are so many other products that Matrix is into, including a big basket of products in the US. HIV is one of the focus areas for the company and it will definitely make an impact.