Sun Pharma down 6% on 14-page USFDA observations letter to Halol

Moneycontrol Bureau

Healthcare major Sun Pharmaceutical Industries shares plunged more than 6 percent intraday Wednesday on US Food and Drug Administration (USFDA) concerns. According to IIFL, the US health regulator has issued 14-page 483 observations letter after inspection of Sun Pharma's Halol unit in Gujarat.The company has confirmed these reports saying the facility has undergone an inspection by USFDA recently and post that the health regulator issued a Form-483 observation letter.

USFDA completed inspection of the manufacturing plant on December 1, 2016.Sun Pharma says it is currently in the process of responding to the said letter to the USFDA within the stipulated timeline of 15 days.IIFL, however, says it is difficult to ascertain severity of the 483 Form as it is not aware of contents of the observations. IIFL has a buy call on the stock.

Another reason for sharp fall in the stock could be because analysts were expecting  resolution for Halol unit by December-end but that seems unlikely now. Earlier in September 2014, the plant had received 483 observations letter of 19 pages that ultimately resulted in warning letter.