Shares of Jubilant Pharmova touched a 52-week high of 699.15 in early trade on April 18 after the company's arm received a 'voluntary action indicated' (VAI) status from the US Food and Drug Administration (US FDA).
At 9:21 am, Jubilant Pharmova was quoting Rs 682.00, up Rs 10.40, or 1.55 percent, on the BSE.
Jubilant Pharmova Limited’s wholly owned subsidiary Jubilant Pharma Limited, announced that its generics arm Jubilant Generics Limited (JGL) received a communication from the USFDA through which the regulatory agency intimated that under its January 25 to February 2 audit of JGL’s solid dosage manufacturing facility at Roorkee, India, it has determined the inspection classification of the facility as Voluntary Action Indicated (VAI)," the company said in a release.
Based on this inspection and the VAI classification, the facility is considered to be in an acceptable state of compliance with current good manufacturing practices (cGMP). With this, the FDA has concluded that this inspection is closed, it added.
In February, the US FDA issued four observations for JGL's solid dosage formulations facility at the Roorkee site.
On April 18, the company informed that its subsidiary Jubilant Cadista Pharmaceuticals Inc., USA, has decided to close the manufacturing operations of its solid dosage formulation facility in Salisbury, Maryland, USA.
The expected date of cessation of manufacturing operation and first separations at the said facility will be on June 17, 2024.
Jubilant Cadista will continue the sales and marketing operations for the US market. The said facility manufactures tablets and capsules for the US market and can serve 1.5 billion doses.
Over the last few years, the US Generics market has been witnessing significant pricing pressure leading to significant losses at Jubilant Cadista since FY2022 onwards.
To move the US generics business to profitability, it has been decided to change the operating model from in-house manufacturing to outsourced manufacturing by selected US FDA-approved CMOs for the US market.
Following the status change of JGL's Roorkee facility by USFDA to VAI, the company expects the exports from the Roorkee facility to the US market to increase in a meaningful and gradual manner. As of now, the facility is exporting only one product, Risperidone to the US market.
These actions are expected to improve the gross margins of the Generics business by reducing manufacturing, quality management, and overhead costs, which will drive the Generics business towards profitability the Generics business has plans to scale up revenues in the US market through the launch of new products, the company said.
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