Aurobindo Pharma shares in focus as unit receives VAI classification; key details

Aurobindo Pharma Ltd shares are in focus on Monday morning after the pharma major said a US-based plant of one of its subsidiary has received Establishment Inspection Report (EIR), classifying the facility as "Voluntary Action Indicated" ("VAI"). The US Food and Drug Administration (USFDA) has concluded that the inspection is now closed, Aurobindo Pharma informed stock exchanges.

Voluntary Action Indicated (VAI) is an official inspection classification used by regulatory agencies. It indicates that an inspection identified minor regulatory violations or undesirable practices, but the agency does not plan to initiate legal or formal enforcement action.

"As this unit is classified as VAI, pending applications for multiple inhalers and other dosage forms filed from this facility can now progress through the USFDA’s review process," Aurobindo Pharma told NSE and BSE.

The United States Food and Drug Administration (USFDA) inspected Raleigh Plant, North Carolina, USA, owned by Aurolife Pharma LLC, a wholly owned step-down subsidiary of the company, established for manufacturing Inhalers, Dermatology and Transdermal products, from March 24, 2025, to April 10, 2025.

At the end of inspection, form 483 was issued with a total of 11 observations.

Aurobindo Pharma shares have 18 'Buy' calls, five 'Hold' recommendations and five 'Sell' ratings. The Bloomberg consensus target on the stock at Rs 1,701 implied 4.9 per cent potential upside over Friday's closing price of Rs 1,622.10 per share.  Investec has 'Buy' rating on the stock with a target of Rs 1,850, Bernstein suggested 'market perform' on the stock with a target of Rs 1,498, while Citi has 'Sell' with a target of Rs 1,270.

Earlier on August 14, Aurobindo Pharma updated exchanges about its Unit-I, a Formulation manufacturing facility, of Eugia Pharma Specialities Ltd, a wholly owned subsidiary of the company, which had received Official Action Indicated (OAI) status by the US FDA.

"Subsequent to OAI, the unit has received a Warning Letter," Aurobindo Pharma said.

The Eugia Pharma Specialities' unit is contributing 2 per cent to company’s overall group revenue. Aurobindo Pharma said there is no impact on the existing supplies to the US markets.

"The company remains committed to working closely with the US FDA and continues to enhance its compliance on an ongoing basis," it said last week.