2nd UPDATE: FDA Says Mylan Facility Investigation Is Ongoing
28 Juillet 2009 - 9:23PM
Dow Jones News
Contradicting statements from Mylan Inc. (MYL) and the U.S. Food
and Drug Administration have created confusion about an
investigation into quality control issues at the generic drug
maker's West Virginia manufacturing facility.
The confusion sent Mylan shares on a roller-coaster ride
Tuesday. It began after a Pittsburgh Post-Gazette story Sunday said
that employees at the plant had covered up computer-generated
warnings about the drugs produced there.
Mylan said Monday that the issue had "no impact on the quality
of our product." Tuesday, the Pittsburgh company issued another
press release saying the FDA had visited the Morgantown
manufacturing facility on Monday and determined that "the baseless
accusations in the article were unfounded."
The FDA later disputed Mylan's comments by saying its
investigation is ongoing.
"The agency has formed no conclusions at this time. Statements
to the contrary are untrue," Steven Solomon, FDA's assistant
commissioner for compliance policy in the Office of Regulatory
Affairs, said in a statement.
In response to the FDA statement, a Mylan spokesman said "our
CEO would never have gone out with a statement like that without
being informed of the closeout of the FDA inspection." Officials
from the FDA weren't immediately available to respond to Mylan's
latest comments.
Several analysts hypothesized that a communication breakdown
between the local inspector, who may have made comments to company
officials, and the official FDA assessment of the investigation as
a whole.
Mylan shares recently rose 4.8% to $12.68. The stock has been
volatile Tuesday, rising as much as 10.5% before sliding 1% lower
than Monday's close after the FDA's statement. The company is
scheduled to report second-quarter financial results Thursday
morning.
The Post-Gazette reported Sunday that Mylan had launched an
internal probe to investigate whether workers at the plant had been
routinely overriding computer-generated warnings about the drugs
being produced at the plant. The newspaper cited an internal report
and had other experts review the report and call it a significant
problem.
Tuesday, Mylan said the agency "noted there was no evidence of
any data deletion. All data was reviewed and was present and
accounted for."
In response to the weekend article, several analysts highlighted
Mylan's reputation of having a strong manufacturing reputation. But
that perception is balanced with the FDA's ongoing vigilance in
making sure that copycat drug makers are meeting required
standards.
Caraco Pharmaceutical Laboratories Ltd. (CPD), Novartis AG's
(NVS) Sandoz unit, and K-V Pharmaceutical Co. (KVA) have all been
subject to facility-related issues in the past year that have led
to major product recalls for the companies.
Even Indian generic companies, like Ranbaxy Laboratories Ltd.
(500359.BY), are under pressure from the agency over quality
controls and manufacturing practices at their plants.
-By Thomas Gryta; Dow Jones Newswires; 212-416-2169;
thomas.gryta@dowjones.com