The observations were classified under VAI (Voluntary Action Indicated) and do not relate to data integrity, according to Piramal Pharma.
Buy / Sell Piramal Pharma share
Piramal Pharma Ltd. was in focus on Wednesday after the company’s Lexington manufacturing facility in the United States was slapped with a Form-483 by the US Food and Drug Administration (USFDA).
The observations came after the USFDA conducted a pre-approval inspection (PAI) and good manufacturing practices (GMP) inspection of Piramal Pharma’s Lexington facility located in Kentucky, USA, from December 27, 2022, to January 10, 2023.
Piramal Pharma on Wednesday said, “At the conclusion of the inspection, the USFDA issued a Form-483 with six observations. The observations were classified under VAI (Voluntary Action Indicated) and do not relate to data integrity.”
Form-483 is issued when FDA observes conditions that “may constitute violations” of the Food Drug and Cosmetic Act and related laws and regulations.
Voluntary Action Indicated (VAI) means objectionable conditions or practices were found but the US drug regulator is not prepared to take or recommend any administrative or regulatory action.
Piramal Pharma said that the company is preparing a detailed response to the observations, which will be submitted to the USFDA within the stipulated timelines.
This morning, Axis Capital initiated coverage on Piramal Pharma with a buy rating and a price target of Rs 160, citing a potential recovery in the CDMO business and attractive valuations. The firm said that any potential corporate action such as a promoter warrant or further infusion by PE firm Carlyle to reduce debt can be a re-rating catalyst for the stock.
The Carlyle Group acquired a stake in Piramal Pharma in October 2020 at an equity value of $2.45 billion.
Last week, Jefferies cited the same CDMO recovery and attractive valuations rationale for initiating coverage on the stock with a buy rating and a price target of Rs 150. Jefferies also said that the headwinds faced by the company over the last 12-18 months are getting resolved.
Shares of Piramal Pharma are trading 1.34 percent lower at Rs 117.45.
(Edited by : Rukmani Krishna)
