FDA Warns KV Pharmaceutical Co. Over Quality Control Issues and Regulatory Non-Compliance

Strategic Insights -

The Food and Drug Administration (FDA) has issued a warning to KV Pharmaceutical Co., a St. Louis-based drug manufacturer, for unacceptable quality control practices at several of its facilities. The FDA inspectors detected improper data reporting, the use of raw materials of questionable quality, and contamination of a vaginal anti-fungal cream. KV has been instructed to improve its quality control measures or face regulatory action such as drug seizure or an injunction.

The FDA's inspectors conducted routine visits to seven KV plants in the St. Louis area on February 7 and March 3. They found that KV had released 12 batches of the vaginal anti-fungal cream contaminated with fibers, paint chips, and other particulate matter. The FDA cited KV for not developing an effective detection procedure to verify that all sources of contamination had been corrected after the problem was known. KV's response to the FDA's list of observations was deemed "generally adequate" by Mary Woleske, acting director of the FDA's Kansas City District.

The FDA had previously taken action against KV in the early 1990s over charges of selectively reported test results and making untrue statements in some test data. KV pleaded guilty to four misdemeanor charges of misbranding EES, a children's antibiotic, and agreed to pay $600,000 in fines and costs in May 1995. As a result, the FDA revoked permission for KV to make three prescription drugs.

KV's Class A shares closed at $19.81 a share, down 13 cents, while its Class B shares closed at $20 a share, down 44 cents. The company had initially planned to withdraw 4 million shares of Class A common stock due to market conditions.

Key Takeaways:

  • The FDA has warned KV Pharmaceutical Co. over unacceptable quality control practices, including improper data reporting and the use of raw materials of questionable quality.
  • KV released 12 batches of a vaginal anti-fungal cream contaminated with fibers, paint chips, and other particulate matter.
  • The FDA instructed KV to improve its quality control measures or face regulatory action such as drug seizure or an injunction.
  • KV had previously pleaded guilty to four misdemeanor charges of misbranding EES, a children's antibiotic, and agreed to pay $600,000 in fines and costs in May 1995.
  • The FDA revoked permission for KV to make three prescription drugs, including EES, after investigating charges of selectively reported test results and making untrue statements in some test data.

Statistics:

  • 12 batches of vaginal anti-fungal cream contaminated with fibers, paint chips, and other particulate matter.
  • $600,000: fines and costs KV agreed to pay in May 1995.
  • 4 million shares: Class A common stock withdrawn due to market conditions.
  • $19.81: closing price of KV's Class A shares on the New York Stock Exchange.
  • 13 cents: decline in KV's Class A shares on the New York Stock Exchange.
  • $20: closing price of KV's Class B shares on the New York Stock Exchange.
  • 44 cents: decline in KV's Class B shares on the New York Stock Exchange.

Sources:

  • "FDA Warns KV Pharmaceutical Co. Over Quality Control Issues" - Source not explicitly mentioned in the original text.
  • "KV Pharmaceutical Co. under scrutiny by FDA" - Source not explicitly mentioned in the original text.
  • KV Pharmaceutical Co. warning letter (May 9) - Addressed to Mary Woleske, acting director of the FDA's Kansas City District.
  • KV Pharmaceuticals Company Profile.
  • New York Stock Exchange.