In December Novartis stopped production at the Lincoln, Nebraska over-the-counter facility after the US Food and Drug Administration sent it a Form 483. Novartis expects the site to resume production, on a line-by-line basis, beginning mid-year 2012 and in the meantime is outsourcing to boost supply.
“Consumer Health has engaged third-party manufacturers to bolster supply of select products, which will help meet demands of patients and customers, as well as enable us to regain lost market share”, Novartis said in a statement to accompany its first quarter results.
Operating profit at the Consumer Health unit, which comprises OTC and animal products, fell by 83 per cent year-on-year. Novartis attributed the plummeting profits to the suspension of production, which caused sales to fall by 20 per cent, and investments to improve quality at the Lincoln plant.
Speaking in January, Joe Jimenez, CEO of Novartis, said: “We have people at the site today. They're working on remediation. We divided the site into technology trains between liquids, powders, capsules, et cetera. I'm fairly confident that we can do this.”
Outsourcing-Pharma contacted Novartis seeking further details of the outsourcing but was rebuffed. “We do work with a variety of third party manufacturers however as a matter of corporate policy we are unable to provide more info on this front”, Barbara Duci, media relations at Novartis, said.
Sandoz strife
Novartis is also contending with quality problems at several Sandoz plants. Operating income at the generics business fell by 28 per cent as “adverse production variances” and investments in quality improvements dragged on results.
Sandoz has faced a succession of quality problems, from a warning letter in November to a 57,000 vial recall last month, and three of its plants are operating below capacity while fixes are made.