Aurobindo Pharma share price hit more than 5-year low intraday on November 14 after company received 14 observations from the US health regulator for its Pashamylaram unit.
The stock fell as much as 9.4 percent to Rs 392.60 on the BSE, the lowest level since August 2014. It was quoting at Rs 399.95, down Rs 33.45, or 7.72 percent at 1032 hours IST.
The drugmaker informed exchanges that the United States Food and Drug Administration (US FDA) inspected its Unit IV, a general injectable formulation manufacturing facility situated at Pashamylaram, Hyderabad, during November 4-13, 2019.
"At the end of the inspection, we have been issued a 'Form 483' with 14 observations," said Aurobindo in its BSE filing.
The company believes that none of these observations are related to data integrity issues. "We will respond to the US FDA within the stipulated timeline," it said.
Aurobindo in its conference call on November 13 had said currently it has a warning letter for Unit 11 and OAI status for Unit 1 and Unit 9.
"We expect reinspection of 3 units to take place over January-March 2020. Unit 7 observations were not related to data integrity. Any plant that has more filings can expect more inspections. Hence, we could see more inspections and more inspectors due to more filings," it added.
India's second-largest drugmaker on November 12 reported a 4.6 percent year-on-year (YoY) rise in net profit to Rs 639.5 crore in the second quarter ended September 30, on higher expenses.
Revenues rose 17.9 percent YoY to Rs 5,600.5 crore. The US formulation business accounting half of Aurbindo’s revenues grew 27.3 percent YoY to Rs 2,835.5 crore. However, on a sequential basis, the US business gained 5.5 percent.
Aurobindo's net debt dropped 9.5 percent on QoQ basis to Rs 3,703.5 crore. "We are targeting to achieve zero net debt over the next 3 years in the existing business," Aurobindo said in a concall.
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