Dr Reddy's slumps as it confirms warning letter from US FDA

Indian drugmaker Dr Reddy’s Laboratories (NYSE: RDY) saw its shares plummet 16.65% to 3,629.55 rupees today, after confirming it has received a warning letter issued by the US Food and Drug Administration,

The letter, dated November 5, 2015, relating to its active pharmaceutical ingredients (API) manufacturing facilities at Srikakulam, Andhra Pradesh and Miryalaguda, Telangana, as well as oncology formulation manufacturing facility at Duvvada, Visakhapatnam, Andhra Pradesh. This action follows the earlier inspections of these sites by the agency in November 2014, January 2015 and February 2015, respectively.

Dr Reddy’s chief executive G V Prasad commented: “We take quality and compliance matters seriously and stand by our commitment to fully comply with the cGMP quality standards across all of our facilities. We will respond with a comprehensive plan to address these observations within the stipulated time-frame of 15 days. We will continue to actively engage with the agency to resolve these issues and we have also embarked on an initiative to revamp our quality systems and processes, as an organization-wide priority.”