USFDA Form 483 points to repeat observations at Dr Reddy's Bachupally plant

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26 Aug, 2025 12:21

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Viswanath Pilla
Moneycontrol News
Dr Reddy’s stock plunged 22 percent intraday on the BSE on February 15, after Form 483 citing 11 observations by USFDA last week on the company's Bachupally plant in Hyderabad pointed to repeat observations.

The stock later recovered to close 4 percent in the red at Rs 2,556.90. The benchmark Sensex declined 0.19 percent to 35,808.95 points.

The Bachupally plant that makes formulations including injectable drugs was audited by two USFDA inspectors Angela Glenn and Cheryl Clausen for 10 days ending February 8.

At the end of the inspection, the agency issued 11 observations on Form 483 outlining certain procedural deficiencies in quality, production and facilities and equipment systems.

Out of 11, four were repeat observations, earlier pointed out by the agency in its 2017 inspection, while one observation goes back to the 2015 inspection.

Moneycontrol saw a copy of the Form 483.

The four repeat observations are: the quality control unit lacking authority to review production records; appropriate controls not exercised over computers or related systems to assure that changes in master production and control records are instituted only by authorised personnel; the procedures applicable to the quality control unit not in writing and fully followed; and laboratory controls not including a determination of conformance to written specifications for in-process materials.

Some of the other observations are related to inadequate investigations of out of specification (OOPs) and employees not following procedures or not being trained for ongoing upgrades.

Three observations are related to facility and equipment systems, includes the need for adequate lab space and lack of valves in drains to prevent back-siphonage.

Dr Reddy's will have to respond to the observations with a preventive and corrective action plan in 15 days from the receipt.

Analysts said the clearance may take time.

“While the observations by themselves would have been procedural given the high number of investigations cited and repeat observations, remediation will take time, in our view,” said Jeffries in its research note.

“The company's response to the letter would be the key. We have seen multiple cases where the FDA has noted the company response and correction plan before deciding on a measure, and we believe this will be the case here. We believe that re-inspection or approval delay is likely. In any case, we believe that the latter highlights the need for further training in quality,” Jeffries added.

Dr Reddy’s has been struggling with regulatory woes for some time. The company is yet to resolve the warning letter it got for its injectable plant in Duvvada in 2015.