Pharma stock falls 3% after USFDA sees major compliance issue in its manufacturing plant

Synopsis: Shares of Sun Pharma fell 3 percent in a day’s trading session after the US Food and Drug Administration (US FDA) inspected the company’s Baska manufacturing facility, found a major compliance issue and classified it under Official Action Indicated(OAI).

The shares of this pharma company is engaged in the business of manufacturing, developing and marketing a wide branded & genetic formulation and API whose product portfolio includes products for cough, pain relief, and digestive health, fell 3 percent after USFDA found a major compliance issue. 

With the market capitalisation of Rs. 4,17,712 Crores the shares of Sun Pharma has reached an intraday low of Rs. 1737 falling nearly 3 percent from its previous day close of Rs. 1792. 

What is the News

The US Food and Drug Administration(US FDA) inspected Sun Pharma’s Baska manufacturing facility from 8 September to 19 September 2025, and found major compliance issues in its manufacturing plant and classified it under Official Action Indicated (OAI) which is given only when the FDA finds serious compliance issues during inspection.  Despite OAI, the company can still manufacture and supply approved products from the facility to the US market, and the company will work with the regulator to resolve the issues 

Company analysis and financials

Sun Pharma is majorly engaged in the business of manufacturing, developing and marketing a wide range of branded and generic formulation and APIs. The company focuses on delivering innovative therapies in dermatology, ophthalmology, and onco-dermatology, while also offering a wide range of generic and branded medicines. Its product basket includes over-the-counter solutions for cough, pain management, and digestive care.

 Backed by 43 manufacturing facilities and integrated API capabilities, the company distributes its products through a strong network of distributors, wholesalers, and retailers. With a pan-India footprint, it also has a significant global presence, serving customers in nearly 100 countries across Asia, North America, Europe, Africa, South America, and Australia.The company has 8.3 percent market share in India with 9 products launched in Q2. The US market contributes 30 percent to the total consolidated revenue. 

Year on Year analysis: Revenue from operations has increased from Rs 13291 Crores to Rs. 14478 Crores, up 9 percent. Operating profit has increased from Rs. 3939 Crores to Rs. 4527 Crores, up 15 percent and net profit has increased from Rs. 3037 Crores to Rs. 3125 crores, up 2.8 percent.

Quarter on Quarter analysis: Revenue from operations has increased on a quarterly basis from Rs. 13851 Crores to Rs. 14478 Crores,up 4.5 percent. Operating profit has increased from Rs. 4302 Crores to Rs. 4527 Crores, up 5 percent and net profit has increased from Rs. 2293 Crores to Rs. 3125 Crores, up 36 percent. 

Written by Vachan Kadli

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