Booming Celltrion Falls After FDA Warning Letter

Shares of South Korea-based Celltrion are down more than 5 percent after the company announced it received a warning letter from the U.S. Food and Drug Administration after the regulatory agency inspected a company drug manufacturing facility.

The letter, which was received Jan. 30, raised concerns related to "certain manufacturing processes" at the facility in Incheon, South Korea, the company said. The FDA inspected the Celltrion manufacturing facility between May 22 and June 2, 2017.

Celltrion acknowledged receipt of the letter on its website but did not elaborate on what concerns the FDA raised. Celltrion said it is "making progress" in addressing the concerns. Additionally, the company said it is committed to working with the FDA to "fully resolve all outstanding issues with highest priority." In a brief report, Reutersnoted that the FDA’s letter "asked Celltrion to turn in supplemental documents" regarding changes the FDA had asked for concerning the company’s pharmaceutical production.

Shin Hyun-joon, an analyst at Hanwha Securities, told Reuters that the FDA issue concerned packaging and was not related to production issues.

Celltrion said it anticipates providing a full response to the FDA within 15 days. The company added that it "remains confident in the safety and efficacy" of the products manufactured at the Incheon site. 

In a statement to Korea Biomedical Review, Celltrion said it received confirmation of the "quality of its products" from the European Medicines Agency following a Good Manufacturing Practice Audit conducted in November 2017. Celltrion said those products that were shown to be of good quality include Remsima, Herzuma and Truxima.

"There is no impact on domestic production or U.S. sales of Remsima, sold in the U.S. as Inflectra, following the FDA’s request for additional supplemental data," the company said in that statement.

What differences there are between the FDA concerns and the EMA report were not reported.

While Celltrion works to address the FDA’s concerns, the company reiterated in its website statement the regulatory warning letter will not affect the company’s ability to manufacture and supply the Inflectra (infliximab-dyyb) products at the Incheon site. Additionally, Celltrion said it does not anticipate any impact on the supply of Inflectra based on this warning letter.

Inflectra is a biosimilar of Johnson & Johnson’s Remicade. Developed with Pfizer, Inflectra was approved by the FDA in April 2016 and first available to U.S. customers later that fall. The approval of Inflectra marked the second biosimilar approved in the U.S. Inflectra is a treatment indicated for reducing signs and symptoms in patients with rheumatoid arthritis, adult ulcerative colitis, plaque psoriasis, psoriatic arthritis, ankylosing spondylitis and adult and pediatric Crohn’s disease.

In December, the European Medicine’s Agency’s Committee for Medicinal Products for Human Use (CHMP) recommended approval of Celltrion’s Herzuma, a biosimilar of Genentech’s Herceptin. The company is awaiting final approval from the EMA.

The drop in Celltrion’s stock price today has stymied strong surging growth throughout the first month of the year. In January, Celltrion’s stock jumped 43 percent as the company advances its biosimilar offerings.

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