DRL shares fall 10 per cent on FDA concerns

The shares of Dr Reddy’s Laboratories, the second largest Indian drug maker by sales, crashed almost 10 per cent in intra-day trade on Thursday after the US Food and Drug Administration (FDA) released the details of its warning letter.

The letter stated that it would withhold appr-oval of any new applications or supplements till the company takes corrective measures to comply with the good manufacturing practices.

“Until you complete all corrections and FDA confirms your compliance with current good manufacturing practices (CGMP), FDA may withhold approval of any new applications or supplements listing your firm as a drug product or API manufacturer,” US FDA said.

Responding to it, Dr Reddy’s said, “The company is in the process of preparing a response to FDA’s warning letter. The FDA has granted an extension until Decem-ber 7, 2015 for the submission of the company’s response to its warning letter. The stock finally ended the day at `3,111.35 losing 8.21 per cent.

In its warning letter, the US FDA expressed doubts the effectiveness of the company’s quality system achieve overall compliance with CGMP.