Sun Pharma decides to shut US subsidiary's facility

MUMBAI: Sun Pharma has decided to shut its manufacturing plant at Detroit, US owned by its subsidiary Caraco Pharma.
Caraco was in trouble following the US FDA inspection last year.
Caraco's two facilities — in Michigan and Detroit were under the US FDA scanner, following violation of manufacturing norms. In 2009, the US FDA had seized all drugs manufactured by Caraco at its Michigan facility for violation of manufacturing standards.In 2013, US health regulator had raised concerns about manufacturing lapses at its Detroit plant.
However, in October 2013, Sun Pharma had stated that it addressed the US health regulator's concerns about manufacturing lapses at its US-based Caraco Pharma, and continued production at the facilities.
"As a part of its manufacturing consolidation in the US, it has notified the Workforce Development Agency for the State of Michigan regarding its decision to cease manufacturing operations and close the Detroit (Caraco Pharmaceutical Laboratories, Ltd) facility located at Elijah McCoy Detroit, Ml, US. The company has provided the requisite advance written notice of the facility closure to the employee union and all affected employees," Sun said in its statement today.
The company said that the impacted employees will get compensated with more than their regular entitlement under the severance package. They will also receive other support services including out-placement assistance. The rest of the employees are continuing through mutually consented arrangements, it added.
According to the company, the manufacturing of these products is being transferred to other units and all necessary steps have been taken to avoid market shortage. "Sun Pharma expects a negligible impact of this development on its FY15 consolidated revenues," the statement added.
Sun Pharma did not provide more details about the employees being laid off, and the products which may be affected.