Following the US FDA's designation of the Roorkee plant as a VAI, Jubilant Pharmova soars to a 52-week high

Following the US FDA's designation of the Roorkee plant as a VAI, Jubilant Pharmova soars to a 52-week high

Pharmova Jubilant's Share Price

Jubilant Pharmova's shares reached a 52-week high of 699.15 in early trading on April 18, after the US Food and Drug Administration (US FDA) designation of the company's arm as "voluntary action indicated" (VAI).

Jubilant Pharmova was quoted Rs 682.00 at 9:21 a.m. on the BSE, up Rs 10.40, or 1.55 percent.

The USFDA informed Jubilant Generics Limited (JGL), its wholly owned subsidiary Jubilant Pharmova Limited, that it has determined the inspection classification of the facility as Voluntary Action Indicated (VAI) following its January 25 to February 2 audit of JGL's solid dosage manufacturing facility at Roorkee, India. The company made this announcement in a release.

This inspection and the VAI rating indicate that the facility complies with current good manufacturing procedures (cGMP) in an acceptable level. The FDA continued, saying that in light of this, the inspection is now closed.

The US FDA issued four observations in February about JGL's solid dosage formulations plant located at the Roorkee location.

The business announced on April 18 that Jubilant Cadista Pharmaceuticals Inc., USA, a subsidiary, has chosen to cease production at its solid dosage formulation plant located in Salisbury, Maryland, USA.

June 17, 2024 is the anticipated date on which the production activity at the aforementioned plant will cease, along with the first separations.

Jubilant Cadista will go on with its marketing and sales initiatives for the US market. The aforementioned plant can produce 1.5 billion doses of tablets and capsules annually for the US market.

Jubilant Cadista has suffered large losses starting in FY2022 as a result of intense price pressure that has been present in the US generics market for the last several years.

It was determined to switch from internal manufacture to outsourcing manufacturing by a chosen group of US FDA-approved CMOs for the US market in order to bring the US generics company back to profitability.

The business anticipates a significant and steady rise in shipments from the Roorkee plant to the US market after the Roorkee facility's status transition from USFDA to VAI. The factory was solely exporting risperidone to the US market at the time.

With lower manufacturing, quality control, and overhead expenses, these steps should increase the generics company's gross margins and push it closer to profitability. The company also stated that the generics company intends to increase sales in the US market by introducing new products.