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Shares of Glenmark Pharma dropped in early trading on Thursday after the United States Food & Drug Administration (USFDA) placed Glenmark's facility in Baddi, Himachal Pradesh, under an import alert 66-40.

An import alert 66-40 is issued when the company is not operating in conformity with current Good Manufacturing Practices (GMP).

In simpler words, the company cannot send any products made out of this facility to the US.

Glenmark's Baddi unit has been under the regulatory lens for many years. Initially, the regulator issued a warning letter for the unit in October 2019. The USFDA issued seven observations for the unit in June this year.

Following the inspection in June, Glenmark had informed the exchanges that the USFDA had maintained its Official Action Indicated (OAI) status on the plant. The OAI status indicates that the regulator expects further corrective actions from the company with regards to the concerned unit.

However, in financial terms, sales from the Baddi unit contributed only 1-2 percent of the company's US revenue for the previous financial year.

Glenmark's other units in Goa and Monroe are also under OAI status from the USFDA since May and August respectively.

Shares of Glenmark are down 2.2 percent as of 9:55 AM at Rs 392.88. The stock is down 27 percent from their 52-week high of Rs 551.

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First Published:Oct 27, 2022 6:27 AM IST