HYDERABAD, Nov 4:Dr Reddy’s Laboratories, which
initiated a voluntary recall of its Ranitidine from the US
market following the ongoing investigation by the FDA into the
reported carcinogenic impurity in the drug at low levels, has
said it made Rs 40 crore towards provisioning, anticipating
market impact.
The city-based drug maker in a filing with bourses had
said the recall which began on October 1, is at the retail
level for over-the-counter (OTC) products and at the consumer
level for prescription products of all of its Ranitidine
medications sold in the US due to confirmed contamination with
N-Nitrosodimethylamine (NDMA) above levels established by FDA.
“Following the company’s decision to voluntarily
recall all of its ranitidine medications sold in the United
States due to confirmed contamination with
N-Nitrosodimethylamine (NDMA) above levels established by the
US FDA, the company recognised Rs 231 million as inventory
write downs towards semi-finished and finished inventory of
ranitidine during the three months ended September 30, 2019.
Further, an amount of Rs 170 million is recognised as
a possible refund liability (as a reduction from revenue)
arising out of the company’s decision to recall the said
product,” Dr Reddy’s said in a regulatory filing.
Dr Reddy’s CEO Erez Israeli in a recent investor call
said the company’s North America generics recorded sales of
USD 202 million for the quarter and declined by 1 per cent
year-over-year and 14 per cent on a sequential quarter basis.
The sequential decline was primarily driven by certain
issues impacting the quarter such as provisions related to
nationwide recall of Ranitidine product due to NDMA impurities
limits following FDA’s caution note regarding the same, he
said.
“We now have completely suspended the sales of
Ranitidine OTC and Rx product (prescription). And,
logistics-related challenges leading to temporary disruption
in supply, which has been addressed since. We expect the sales
run rate to normalise from Q3 onwards,” the official said.
NDMA is classified as a probable human carcinogen (a
substance that could cause cancer) based on results from
laboratory tests.
NDMA is a known environmental contaminant and found
in water and foods, including meats, dairy products and
vegetables. (PTI)
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