On November 23, 2023, Cipla, a prominent pharmaceutical company, witnessed a nearly 7% decline in its stock following the issuance of a warning letter by the United States Food and Drug Administration (US FDA) to its Madhya Pradesh unit. 

Shares of Cipla hit an intraday low of Rs 1,164.55, down 8.41% from the last closing price on the National Stock Exchange (NSE). The stock closed 7.64% lower at Rs 1,174.40 apiece. 

The letter, dated November 17, pertains to routine good manufacturing practices (GMP) inspection conducted at Cipla’s Pithampur facility between February 6 and 17, 2023. The warning letter specifically outlined data integrity issues, including product complaints and microbial contamination at the manufacturing facility. 

Cipla, in its exchange filing, acknowledged the receipt of the warning letter and emphasised its commitment to responding within the specified time frames. The company expressed its dedication to working closely with the US FDA to address the highlighted issues comprehensively and promptly.

The US health regulator’s warning follows similar and repeated observations for Cipla’s Goa facility, which is currently under the status of “Official Action Indicated,” impacting product approvals for the US market. 

Cipla’s management revealed that the observations on both the Pithampur and Goa facilities were causing delays in product launches, estimating a setback of six months. To address the issues raised by the US FDA, Cipla has been directed to engage third-party consultants, indicating the severity of the compliance concerns.