US FDA plant observations at Cipla cause 6-month delay in product launches: CEO

The biggest product under manufacture in the Pithampur facility is Advair which has a market size of $700 million

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The US Food and Drug Administration (US FDA) observations at Cipla's plants in Pithampur and Goa are delaying the launch of products by almost six months, the management said in a press meet following its Q2 results.

"We are delayed by six months, from where we could launch, to the time we will," said MD and Global CEO Umang Vohra while addressing journalists. He mentioned that the process of shifting the manufacturing of the products to other plants has been ongoing for the past 4-5 months.

The biggest product being manufactured at the Pithampur facility is Advair. "We are in the process of shifting it to Hauppauge in Long Island," Vohra stated. Advair, which is used in the treatment of asthma and chronic obstructive pulmonary disease, is expected to have significant revenue potential, with analysts expecting it to bolster Cipla's financials.

The drug commands a market size of $700 million, and Cipla is leading the race to launch the first generic version, despite the delays. Only select generic players have a presence in the respiratory space, with the most active ones being Cipla, Lupin, Teva, Vitaris, and Hikma. Although Lupin is also in the race to launch gAdvair, brokerage firm Jefferies doesn't expect it to launch the drug anytime soon, leaving Cipla with an open field.

Vohra added that most of the assets that could have been launched from Indore, in the next one or two years, have reached a point where they will be launched in the second half of next year.

Regarding the Goa facility, he said that a couple of inhaler products from Goa will be manufactured at Cipla's facility in Boston. Thus, the product will be filed from both Indore and the US facility.

Currently, the Cipla Pithampur plant has 8 observations from the US FDA, and the Goa facility is under the 'Official Action Indicated' status.

On October 27, Cipla reported a 43.3 percent year-on-year rise in consolidated net profit at Rs 1,131 crore for the July-September quarter of the current financial year and its highest-ever revenue from the US at $229 million.