Teva reports FDA warning on Jerusalem facility

Teva: Until we can correct outstanding issues to the FDA's satisfaction, the FDA may withhold approval of pending drug applications listing the facility.

Teva Pharmaceutical Industries Ltd. (Nasdaq: TEVA; TASE: TEVA) today announced that it has received a warning letter from the US Food and Drug Administration (FDA) about the FDA's Good Manufacturing Practices (cGMP) inspection of the companys Jerusalem Oral Solid Dosage (OSD) manufacturing facility, which took place in September. Teva is run by president and CEO Shlomo Yanai.

Teva said that, since its initial written response to the warning in October, it has addressed the FDA's observations, and "is working diligently to resolve any outstanding FDA concerns listed in the warning letter."

The FDA cited "significant violations" of cGMP related to laboratory reporting and systems. The FDA said. "These violations cause your drug products to be adulterated in that the methods used in, or the facilities or controls used for, their manufacture, processing, packing, or holding do not conform to, or are not operated or administered in conformity with, cGMP." The FDA added that Teva's response in October "lacks sufficient corrective actions."

Teva said the warning letter does not restrict production or shipment of the company's products from the OSD facility. However, unless and until the company is able to correct outstanding issues to the FDA's satisfaction, the FDA may withhold approval of pending drug applications listing the Jerusalem OSD facility. The FDA may also withhold permission to export products manufactured at the facility into the US.

Commenting of the FDA warning, Citi analyst John Boris said that the Jerusalem OSD facility accounts for less than 3% of Teva's estimated $16.3 billion sales in 2010, or about $480 million. "After reviewing the letter, we do not expect the deficiencies to materially affect production or shipment from this facility. We note that the FDA is withholding Abbreviated New Drug Application (ANDA) approvals associated with the Jerusalem facility until Teva resolves outstanding cGMP issues."

Citi added that the issue does not affect Teva's ANDA for generic Zyprexa, which is not manufactured at the Jerusalem facility. Citi concluded that it views an enhanced buying opportunity in Teva on any weakness created by this issue.

Teva's share price fell 0.7% on Nasdaq yesterday to $55.38, and fell 1.3% in early trading on the TASE today to NIS 201.90.

Published by Globes [online], Israel business news - www.globes-online.com - on February 3, 2011

Copyright of Globes Publisher Itonut (1983) Ltd. 2011

 
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