Wockhardt ramps up quality control systems

Wockhardt is putting all the checks and balances in place after quality concerns were raised by overseas regulators over two of its plants.

The company has brought in a new head of quality to ensure good manufacturing practices (GMP) are followed to the tee.
Habil Khorakiwala, chairman and group CEO, Wockhardt Group, said owing to the recent issues with the US Food and Drug Administration (FDA) the company has restructured the leadership as far as quality systems are concerned.

“We have re-looked our quality systems, the people involved and have brought in the right kind of resources. To ensure consistency in quality, we are bringing in a lot of automation in the system and integrating it with the entire organisation.”

“A system akin to SAP (used in financial system) is being used for quality control,” said Khorakiwala, adding a employee training programme on quality has been put in place.

In July, the US FDA and the UK Medicines and Healthcare Products Regulatory Agency (MHRA) had jointly inspected the company’s Chikalthana plant and made observations.

Wockhardt’s plant at Waluj, Aurangabad, already has an import alert from the US FDA.

Khorakiwala said that consultants from the US have been brought on board to advice in dealing with issues raised by the foreign regulators.

“We have adequate consultants for all the aspects of the work and we have been responding to letters received. We are also seeking a meeting with the FDA and the MHRA. Our approach is to get the clearances for both the facilities at the earliest possible,” he said.

Wockhardt’s new head of quality now reports directly to the managing director.

“The duo is involved in overseeing and taking decisions on all aspects of quality across the organisation,” he said.
However, the analyst community sees the recent initiatives of the promoters as short-term confidence building measures.

Any significant uptick, the analysts said, will only happen once the US FDA and MHRA react to Wockhardt’s responses and corrective actions taken by it.

On Tuesday, the stock rose 20%, closing at a high of `616.5 on the BSE as the company inked a settlement of a pending patent litigation with US-based Avanir Pharmaceuticals.

The settlement gives Wockhardt rights to sell a generic version of Nuedexta starting July 30, 2026, or earlier under certain circumstances.

On Wednesday, the stock rose 9.3% over the previous close.

Bhavin Shah, pharma analyst, Dolat Capital, said the Wockhardt management is doing everything possible to instill confidence among investors.

“However, fundamentally nothing much has changed as far as its business is concerned,” he said.

Bhavika Thakkar, analyst, India Infoline, said after the foreign regulators, the Indian drug regulators had also visited the Waluj facility and raised some observations.

“The management has said that observations raised by them were not serious in nature and have been cleared as well, which is reflecting in the stock price,” she said.

The drug maker operates 12 facilities globally, most of which have been inspected and cleared by both the FDA and the MHRA.