USFDA issues import alert for Divi's Labs Vizag unit

The United States Food and Drug Administration (USFDA) has issued an import alert for Divi’s Laboratories’ Visakhapatnam unit-II.

An import alert from the regulator means that products from the facility meant for imports can be refused without a complete physical examination. The latest USFDA move comes as a blow for the pharma company as it hadn't been expecting an import alert.

Six active pharmaceutical ingredients (APIs) namely Levetiracetam, Gabapentin, Capecitabine, Naproxen, Raltegravir and Atovaquone have been excluded from the import alert, sources told CNBC-TV18.

It is too early to gauge the impact of this, said Surajit Pal of Prabhudas Liladhar. Certain products have been excluded so that there is no shortage of it in the US markets.

The company’s Visakhapatnam unit II contributes 60-65 percent to total sales and 20-21 percent to US sales.

In December, the USFDA has issued five observations to Divi’s Vizag unit, which was inspected from November 29-December 6. The company has engaged consultants to undertake remediation of its Vizag unit, sources said.

Pal further said that the warnings and import alert is still not reflected in the company’s valuation. Divi's could see some downmove on back of the news.

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