- The Food and Drug Administration has made official its concerns with Mylan's handling of operations at its largest manufacturing plant, issuing a sharply critical warning letter earlier this month that lays out a series of missteps and oversights at the Morgantown, West Virginia facility.
- The letter doesn't come as a surprise, however. Following an FDA inspection of the site in April 2018, Mylan began a major restructuring and corrective program that's so far cost more than $100 million.
- Still, the warning is notable, both in its findings and because it marks the first time the plant has fallen afoul of the FDA since Mylan established it in Morgantown 52 years ago. In a statement, the company said it has regularly communicated with the agency and is working with customers to mitigate any supply disruptions related to the ongoing remediation work.
Mylan has moved quickly to address the FDA's concerns and minimize the impact of the warning letter to its business. The generic drugmaker proactively transferred production of certain drugs from the Morgantown facility and none of the company's planned drug launches next year were filed from the site.
Even so, Mylan's already taken a financial hit, both in spending to correct the violations and in lower gross margins as a result of that work. More than 400 employees at the plant, mostly involved in production, were laid off in April.
But broader impact to its business could be limited, as only eight of Mylan's top 50 gross margin generating products are manufactured at Morgantown.
Reputationally, the warning letter puts a spotlight on a drugmaker previously known for a clean regulatory track record.
"Receipt of the letter is largely symbolic at this point, providing a clear reminder of just how quickly the regulatory landscape has evolved and even best-in-class manufacturing houses can eventually run afoul of good manufacturing practice requirements," wrote Elliot Wilbur, an analyst at Raymond James, in a Nov. 20 note to investors.
FDA Commissioner Scott Gottlieb has called out Mylan directly, pointing to the warning letter on Twitter earlier this week.
An important aspect of ensuring drug safety is adherence to current good manufacturing practices. Recently #FDA issued a warning letter to Mylan Pharmaceuticals for CGMP violations. We expect the firm to work to resolve the issues identified by the #FDA https://t.co/GQ62ivLy1A— Scott Gottlieb, M.D. (@SGottliebFDA) November 20, 2018
The warning letter highlights three major areas of concern: inadequate cleaning processes that, in one recent case, created risk of cross-contamination; investigations into out-of-specification test results that didn't consistently identify root causes; and a failure to appropriately manage process changes.
"Your lack of rigorous oversight of manufacturing changes continues to be a major factor in the unexpected variation observed in your drug products," the FDA wrote in its letter dated Nov. 9.
Regulators also marked their concern that the Morgantown site's quality control unit wasn't fulfilling its role.
"Your firm must provide the quality unit with the appropriate authority, sufficient resources, and staff to carry out its responsibilities and consistently ensure drug quality."
While the Morgantown plant has avoided any warning letters before, three other facilities and a laboratory run by the drugmaker have been flagged for manufacturing violations by the FDA since 2015.
For its part, Mylan has emphasized its ongoing remediation efforts, noting that the Morgantown warning letter is the only letter from the FDA currently outstanding.
"We have an industry-leading track record in global quality management, and we take very seriously our continued and comprehensive oversight of Mylan's entire manufacturing network," the company wrote in a statement. "We continuously learn from inspections of our facilities by FDA and other authorities as regulatory expectations continue to evolve."