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Dr Reddy's cracks 14% after US FDA warning letter

The stock fell after the drug major received a warning letter from US FDA on their API manufacturing facilities at Srikakulam and Oncology formulation facility at Duvvada in Andhra Pradesh.

BT Online | November 6, 2015 | Updated 16:09 IST
Dr Reddy's cracks 14% after US FDA warning letter
The stock ended 14.5 per cent down after hitting an intraday low of Rs 3615, down 14.99 per cent on BSE. Photo: Reuters

Shares of Dr Reddy's Laboratories cracked 15 per cent in trade on Friday and headed towards their biggest single day fall since October 2008, after the US FDA issued a warning letter to pharma major.

The stock ended 14.5 per cent down after hitting an intraday low of Rs 3615, down 14.99 per cent, on the Bombay Stock Exchange (BSE).

The company's API manufacturing facilities at Srikakulam and Oncology formulation facility at Duvvada in Andhra Pradesh received a warning letter from US FDA.

"We will respond with a comprehensive plan to address these observations within the stipulated time-frame of 15 days," said CEO GV Prasad in a statement.

"We will continue to actively engage with the agency to resolve these issues and we have also embarked on an initiative to revamp out quality systems and processes, as organization-wide priority," Prasad added.

"Company had done site transfer earlier for generic Nexium and Srikakulam plant contributes nearly 10-12 pct of total revenues," told CFO Saumen Chakraborty to news channel ET Now.

(With inputs from Reuters)

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