US FDA SCRUTINY OF PLANTS ON THE RISE

Factory inspections by US regulator rise threefold in 6 years

US Food and Drug Administration (FDA) inspections at pharmaceutical units in India tripled between 2010 and 2015, says the Indian Pharmaceutical Alliance (IPA).

In 2015, FDA did 204 inspections; in the first six months of 2016, it made 101 inspections in India, the highest in any country outside the US. Between 2010 and June 2016, inspections were carried out 840 times in India, more than in any other foreign country.

Changes in FDA policies and pressure from US lawmakers for stricter regulatory oversight, following a number of data integrity issues, is said to have triggered the increase.

India is the second largest drug exporter to the US by volume and fifth largest by value. It has 572 manufacturing facilities registered with the FDA. Yet, says D G Shah, secretary general of IPA, 189 of these have never been inspected.

According to him, drug makers in India may face more pain if FDA begins inspecting plants which have never been inspected earlier.

“Over the past decade, India has evolved into a key supplier of generic drugs to the US. It is estimated that 35 per cent of the Abbreviated New Drug Applications approved in the US every year come from Indian companies. Consequently, the regulatory compliance expected of Indian manufacturers is of the highest order. In addition to good manufacturing practice issues, FDA has also been raising concerns on systems and data integrity. We believe such increased levels of regulatory scrutiny are here to stay, and companies need to factor in the costs of operating at higher compliance levels into their business plans,” said Krishnakumar V, partner (life sciences, transaction advisory services), EY India.

In 2012, the US introduced a Generic Drug User Fee Amendment (GDUFA), with the twinpurposeofexpeditinggeneric drug approvals and ending disparities between inspections of US-based and foreign plants.

“One of GDUFA's most important items was to hold all human generic drug manufacturers to the same high quality standards, regardless of location. Prior to GDUFA, the regulator was required to inspect USbased generic drug manufacturers every two years but no such requirement existed for manufacturers outside the US. This disparity, combined with insufficient resources, created significant vulnerabilities in the US drug supply chain,” Edelweiss Securities said in a recent research report.

Over the past two years, the FDA got additional funding to conduct inspections, following concerns from US lawmakers that it lacked resources. In 2015, legislators had asked the US government's accountability office to investigate FDA’s ability to oversee foreign plants.

The rise in inspections has also resulted in increases in issue of warning letters to facilities. Since the introduction of GDUFA in 2012, as many as 55 per cent of the good manufacturing practice related-warning letters have been issued to facilities in India and China, the Edelweiss report said.

“I do not see any bias in the FDA inspections. The industry has demonstrated its resolve to improve compliance and quality, and there is no trust deficit between the industry and the regulator,” says Shah.