A German government's drug regulating agency, which audited one of Dr Reddy's Laboratories manufacturing facilities here, found "dirty rooms and equipment", among other violations, during an inspection.
According to the inspection report by Central Authority for Supervision of Medicinal Products in Bavaria (GMP/GCP) of the Upper Bavarian government, the inspection was conducted on August 1 at the drug maker's formulation manufacturing unit-2 at Bachupally.
"Major deficiencies: (only examples are given for sub-items related to 5 major deficiencies)...3. cleaning of rooms and equipment. (9 sub-items) 3.1 dirty rooms and equipment 3.2 integrity of cleaning-documentation 3.3 cleaning-status labeling 3.4 status-label 'clean' of uncleaned equipment 3.5 dedicated-equipment labeling 4. validation of manufacturing process. (4 sub-items)...," the regulator said as nature of non-compliance in its report.
The drug-maker's German subsidiary betapharm Arzneimittel GmbH had received a communication from the Regulatory Authority of Germany (Regierung von Oberbayern) in August that the regulator had not renewed GMP (good manufacturing practice) compliance certificate of its formulations manufacturing following an inspection.
"Pending revocation of the non-compliance certification, the plant will not be able to make any further dispatches to European Union until the next inspection, to be initiated by an invitation from Betapharm," Dr Reddy's had earlier informed.
Dr Reddy's Global Generics segment's revenues from Europe are primarily derived from Germany, the United Kingdom and out-licensing business across Europe. It clocked Rs 207.5 crore revenues from the region for the three months ended June 30, 2017, an increase of 28 per cent as compared to the three months ended June 30, 2016.
The increase was primarily on account of the increase in sales volume of existing products along with new products launched between July 1, 2016 and June 30, 2017, the company had said in filing with US Securities and Exchange Commission.
When contacted, a company spokesperson refused to comment on the impact of the revenues from Europe following the German regulator's comments.
The official said they are in "silent period" pending results announcement and hence cannot comment.
DRL is slated to announce its July-September quarter results on October 31.
Regierung von Oberbayern also concluded an audit of the company's formulations manufacturing facility in Duvvada, Vishakapatnam, with zero critical and six major observations recently. The products manufactured at the facility are not currently exported to the EU.
The Duvvada-facility's compliance with the corrective and preventive action plan and other applicable regulations will be reviewed again by the regulator by November 2018 for continuation of the facility's EU-GMP certification, Dr Reddy's had said.
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