The shares of leading drug maker Cipla saw significant gains today after it announced that its manufacturing plant in Goa had received a positive inspection outcome from the United States Food and Drug Administration.
In a regulatory filing, Cipla informed that the USFDA had completed an audit of its Goa facility earlier this year in June. The inspection was conducted to evaluate the site’s compliance with Current Good Manufacturing Practices or cGMP standards. These standards are aimed at ensuring quality control and production practices are met for products intended for the US market.
The company has now learnt that the US regulator has classified the inspection as Voluntary Action Indicated or VAI. This classification implies that while certain objectionable conditions were identified, the FDA believes these can be addressed voluntarily by the company without any compulsory regulatory action needed. Obtaining a VAI status is considered a positive result and keeps the facility in good standing with the American drug authority.
Investors welcomed this development, driving Cipla’s stock price up sharply by over 10% in intraday trading. The pharmaceutical major has a significant presence in the US as it supplies generic and branded generic drugs. The VAI recognition indicates the Goa plant continues to meet the stringent quality oversight required for product approvals and supplies in what is one of the world’s largest pharmaceutical markets.
In the recent June quarter too, Cipla had posted decent financial growth with net profit rising by over 15% compared to the previous year period. Its overall revenues and operating margins saw healthy double-digit growth rates. The recognition of its manufacturing capabilities is expected to provide further impetus for business expansion globally.
