Dr Reddy's shares sink after Chinese authority suspends import, sale, use of its Atomoxetine Hydrochloride capsule

On August 30, Dr Reddy's received an order from GST Authority towards tax demand of Rs 13.54 crore.

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Dr Reddy's shares sank into the red after the Chinese drug regulator National Medical Products Administration of China (NMPA) decided suspended the import, sale, and use of the pharma giant's Atomoxetine Hydrochloride capsules.

At 10.30 am, Dr Reddy's shares sank 1.4 percent in trade to Rs 6,937 on the NSE.

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In a filing with the exchanges, Dr Reddy's Laboratories said that the NMPA China recently conducted a remote inspection of the firm's formulations manufacturing facility for Atomoxetine Hydrochloride capsules.

Atomoxetine Hydrochloride is a capsule which is used for treating attention deficit hyperactivity disorder (ADHD) in adults and children.

The NMPA concluded that the production quality management of Atomoxetine Hydrochloride capsules does not meet the requirements of China's "Good Manufacturing Practice for Drugs (Revised in 2010)". Therefore, it decided to suspended the import, sale, and use of
the DRL's Atomoxetine Hydrochloride capsules effective August 30, 2024.

The  National Drug Joint Procurement Office, China, after considering the order of the NMPA, decided to cancel Dr. Reddy's Laboratories' Atomoxetine Hydrochloride capsules “won” status.

It also decided to list the Dr Reddy's on the "Violation List", which suspends the pharma major's  eligibility to participate in China's national centralized drug procurement activities from August 30, 2024 to February 28, 2026.

On August 30, Dr Reddy's received an order from GST Authority towards tax demand of Rs 13.54 crore. "The authority has passed the order for the year 2019-20 and 2020-21 on the contention that the Company has excess availed of ITC," said the pharma firm in an exchange filing. Dr Reddy's will evaluate filing necessary appeal with the appellate authority in this regard.

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