Warning letter faults Akorn management for plant failures

By | July 10, 2019

When Akorn acknowledged two weeks ago that the FDA had slapped its New Jersey sterile injectables plant with a warning letter, CEO Douglas Boothe said he remained confident about the quality of its products. Unfortunately for the company, the FDA doesn’t feel the same way. 

In the warning letter posted Tuesday, the FDA admonishes the company for some of the same data integrity issues that led Fresenius to bail out of its $ 4.3 billion buyout in 2017. It also lambasts it for not carefully and thoroughly investigating a number of serious problems—including finding metal shavings on the filling line for lidocaine hydrochloride 2% jelly. 

“Many of your investigations, including those initiated for stability failures, remained open for long periods of time, up to 19 months, without adequate justification,” the FDA lectures in its letter about the Somerset plant. “Unresolved drug product quality problems may pose a risk to patients.” 

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The company sometimes jumped to conclusions about what caused the issues but then failed to prove those were the case. It blamed the metal shavings on non-conforming aluminum tubes but didn’t bother to test them to confirm it. Leaky bottles of ophthalmic solution were blamed on defects in bottles from the supplier. Akorn said it was an isolated incident, but the FDA points out the company had received customer complaints for the same issue. 

The agency gives Akorn credit for recent efforts to fix its shortcomings but says it is still not doing enough. It faults management for failures that put patients at risk. 

“The details provided in your response did not clearly define management responsibilities relating to timeliness and the number of extensions that may be granted to an ongoing investigation.”

RELATED: Akorn lenders will declare it in default if a new loan agreement is not reached but progress is being made

The letter says some of the issues are repeats of problems laid out in a February warning letter for Akorn’s headquarters facility in Lake Forest, Illinois. The company was also slapped with a Form 483 on its plant in Amityville, New York, last year.  

All of this comes as Akorn is working feverishly to keep itself financially upright. Boothe, who was named CEO late last year, has acknowledged the company is negotiating a standstill agreement with lenders. It has said it must meet specific milestones while it renegotiates terms of its loans. If the milestones are not met, or a new agreement is not struck by Nov. 15, Akorn can be declared in default. 

Boothe says the company has made structural and organizational changes to “emphasize compliance, transparency, and accountability,” at its three U.S. manufacturing facilities. On top of that,  Akorn has decided to “explore strategic alternatives” to divest its India manufacturing facility.

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