As U.S. regulators push hundreds of new generic drugs to market in an effort todrive down prices, the industry is facing acontinuing problem in India, where many copycat medicines aremanufactured.

|

The Food and Drug Administration approved a record 763generic drugs in the year ending in September 2017. It expects tosign off on even more rivals for branded drugs in 2018. FDA Commissioner Scott Gottlieb has vowed totackle a lack of competition he has said is “a root cause of highdrug prices.”

|

But getting more low-cost medicines to pharmacy shelves couldstrain a global supply chain already confronting questions boutquality and safety -- especially in India, where about 40 percent of generic drugstaken by Americans are made.

|

The FDA’s efforts to police Indian drug plants have beenhampered by staffing shortages as well as aggressive tactics bydrug-company employees to cover up potential problems. FDA reportsshow some workers in India destroyed records to keep regulators inthe dark about production issues.

|

Those oversight gaps could widen as the FDA tries to create adeeper market and companies seek to preserve their profits.

|

“We’ve increased our focus on data-integrity issues. The factthat we’re unearthing more data-integrity issues, it means therewere problems that were systemic and the FDA is starting to crackdown,” said Gottlieb in an interview.

Paper trail

FDA inspection reports from India read like mystery novels fullof deleted data, shredded documents and evasive employees. Intriguesurrounds tests designed to ensure that generic drugs are free ofcontaminants, properly formulated, and work like the products theymimic. When those tests fail, evidence has often vanished or beenconveniently invalidated, agency records show.

|

In a March 2017 visit to a Dr. Reddy’s Laboratories Ltd. plant inAndhra Pradesh, a state bordering India’s southeastern coast, twoFDA inspectors caught lab employees deleting computer files andlists of recent documents to avoid detection. Company officialsinitially denied that workers destroyed the data but capitulatedwhen pressed by inspectors.

|

Continued on next page >>>

|

The facility continues to manufacture drugs for the U.S. market.The FDA typically gives companies time to fix issues uncoveredduring an inspection before banning products from theU.S.

|

“Over multiple days in multiple departments we were providedfalse and misleading answers to the questions that we askedemployees,” the inspectors wrote in a report released Jan. 3.“The pattern of providing false and misleading statements persistedthroughout the inspection.”

|

The inspection, which yielded more than 50 pages of observationsdetailing data discrepancies and failures to follow propermanufacturing standards, was a follow-up to a 2015 visit to thesame plant, after which the FDA warned Dr. Reddy’s overmany of the same practices.

|

Dr. Reddy’s declined to comment.

Enforcement struggle

India’s drug-manufacturing problems go back years. In 2013,Ranbaxy Laboratories Ltd., which was later bought by Sun Pharmaceutical Industries Ltd.,agreed to pay $500 million to resolveallegations it sold adulterated drugs and lied about it to U.S.regulators.

|

Two of the plants Sun bought in that deal still aren’t permittedto send products to the U.S. Another Sun facility has been on theFDA’s banned list since 2014 after deleting more than 5,000potentially undesirable tests.

|

In all, the FDA lists 44 drug-manufacturing facilities in Indiathat are banned from sending products to the U.S.

|

Despite vowing to step up inspections, the FDA has struggled tomonitor the more than 500 facilities in India registered to makedrugs for the U.S. Agency inspections there dropped 27 percent infiscal 2017 from a year earlier, to 185 from 252.

|

The FDA’s New Delhi office was authorized to have 13investigators but only three slots were filled as of July 16, 2016,according to a Government Accountability Office report last year.

|

The number of inspections the FDA does each year can fluctuate,as does its staffing levels, Lauren Smith Dyer, an agencyspokeswoman, said in an email. The agency determines whichdrugmakers to inspect based on known safety risk that takes intoaccount compliance history as well as the type of products beingmanufactured.

|

“We think we’re much more effective at targeting thoseinspections now,” said Gottlieb, the FDA chief.

Data integrity

India’s pharmaceutical industry has improved the sanitationissues that plagued it when the FDA began increasing resourcesthere; inspection reports no longer feature fly infestations and drains spilling over with urine. But assuring that the data reported to the FDAis fair and accurate and that important results haven’t beenconcealed still appears to be a problem.

|

In November, the FDA warned two Indian facilities operated byLupin Ltd. for ignoring tests showing thatpills made there didn’t meet quality standards. In 2015 and 2016,the FDA found 134 instances when drugs or active ingredientsfailed initial testing but the company chose tooverride the results. Lupin called the failed tests “laboratoryerror” even when evidence suggested that wasn’t the case, accordingto the FDA.

|

Continued on next page >>>

|

Lupin has 11 facilities that manufacture generics globally,according to its website. Its productsinclude widely prescribed antibiotics, oral contraceptives andcardiovascular and depression drugs. According to a review of generic versions of depression drugCymbalta by Bloomberg News last year, Lupin’s was the subject ofthe most complaints to the FDA.

|

Lupin didn’t respond to a request for comment.

Global repercussions

Big foreign drugmakers such as Mylan NV, incorporated in the Netherlands,and Fresenius SE, headquartered in Germany, alsoreceived warnings about their manufacturing facilities in India.Mylan employees at its Maharashtra plant failed to investigate whydrugs there didn’t meet quality standards and didn’t reportsubstandard test results, according to the FDA.

|

“Consumers have no reason to be concerned by the quality ofMylan drugs manufactured in India,” Lauren Kashtan, a Mylanspokeswoman, said in an email. Mylan believes it has addressed theFDA’s concerns “and are awaiting re-inspection very soon,” shesaid.

|

Workers at a Fresenius plant in West Bengal that makescancer-drug ingredients aborted more than 200 quality tests because itappeared that they would reveal potentially tainted products, andinstead blamed human or machine error, the FDA found.

|

“We always take quality and compliance at all of our facilitiesvery seriously,” said Matthias Link, a Fresenius spokesman, in anemailed statement. “We will of course address the issues raised bythe FDA as swiftly as possible and work closely with the agency toassure they are fully informed of our progress.”

Cracking the problem

The bigger companies in India “have the resources to to crackthis problem, they just probably haven’t had the experience,” saidDavid Campbell, a partner in the consulting firm Oliver Wyman’shealth and life sciences practice. “As they continue to grow, theexperience will come with it.”

|

“The FDA is saying, ‘Our goal is to get effective, safemedicines,” Campbell said.

|

Smaller companies will step up as well, he said, particularly ifthey want to differentiate themselves as the FDA’s push forcompetition increases access -- and pricing pressure.

|

“That is the nature of the global market maturing,” Campbellsaid.

|

Copyright 2018 Bloomberg. All rightsreserved. This material may not be published, broadcast, rewritten,or redistributed.

Complete your profile to continue reading and get FREE access to BenefitsPRO, part of your ALM digital membership.

  • Critical BenefitsPRO information including cutting edge post-reform success strategies, access to educational webcasts and videos, resources from industry leaders, and informative Newsletters.
  • Exclusive discounts on ALM, BenefitsPRO magazine and BenefitsPRO.com events
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.