Aurobindo Pharma shares fell over 4% to Rs 685.85 on the BSE in intraday trade on Friday after it received a warning letter from the US health regulator for its Hyderabad-based Unit I, an API (active pharmaceutical ingredient) manufacturing facility.

At 11:20 a.m., Aurobindo Pharma was trading 4.03% down at Rs 689.00, compared to a 0.52% drop in the S&P BSE Sensex.

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According to a regulatory filing by the company, the action follows a recent inspection of the facility by the US Food and Drug Administration (USFDA) in August 2021.

The US Food and Drug Administration issued a Form 483 with seven observations of violations of good manufacturing practices to the bulk drug manufacturing unit that was inspected in August.

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Inadequate evaluation and qualification of crucial material suppliers, insufficient sampling strategies for raw materials and intermediates, and components utilized in manufacturing not being tested and released prior to use were among the observations.

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Other findings include: proposed adjustments were not adequately evaluated, quality control failed to assure scientifically sound research, and equipment was not properly maintained and recorded at the time of performance, according to a CNBC-TV18 report.

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“The company believes that this will not impact the existing business from this facility,” it noted. The drugmaker stated that it will be engaging with the regulator and is fully committed to resolving the issue at the earliest.

The company is committed to maintaining the highest quality manufacturing standards at all of its facilities across the globe, it noted.

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A warning letter is issued when the US health regulator finds that a manufacturer has significantly violated its regulations. The letter identifies the violation, such as poor manufacturing practices, problems with claims for what a product can do, or incorrect directions for use.

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The letter further emphasizes that the company must resolve the matter and offers instructions and a timeframe for doing so. The FDA then verifies if the company’s corrections are adequate.