FDA Decree Results into Shares Fall for Genzyme

• Date: March 26, 2010
• Source: Admin

Genzyme and Its Fouled Situation

From last year, Genzyme is facing quite a tough time. A viral contamination led to the shutdown of its Boston plant and at the same time forced it to restructure and refurbish the manufacturing process. Moreover, during the process Genzyme had to replace and cancel production contract of some of its drugs such as Cerezyme and Fabrazyme, which resulted into global shortage of medicines.

This year on March 23, FDA informed that it would install a third party group “for an extended period" to inspect, review and certify the drugs produced at the Boston plant, where the FDA had in November found traces of pollutants, including steel and rubber. Moreover, the agent announced that it may require to the company to make payments to the government. As a result of the announcement made by the FDA, it is assumed, Genzyme shares fell down abruptly.

In a statement Wednesday, the company assured to "work cooperatively with the FDA to restore the agency's confidence in its ability to operate the Allston plant at the highest standards, building on the progress it has made over the past year to address the manufacturing deficiencies."

However, Genzyme is still unaware of the financial upshots of the declaration but the company assures that the FDA demands will not cause the Gaucher and Fabry disease medications to fall out of production for a second time. Genzyme has only recently brought production of the Gaucher treatment up to normal levels after it too was scarce for the second half of 2009. The company is also hoping that the agency’s action doesn’t interrupt finishing work at the plant on alglucosidase alfa (Myozyme), a Pompe disease therapy, and thyrotropin alfa (Thyrogen), which is used in patients with thyroid cancer.

Source:

http://www.thestreet.com/story/10710726/1/genzyme-shares-fall-on-fda-action.html?puc=_tscrss

http://www.transworldnews.com/NewsStory.aspx?id=286484&cat=1