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PAR EXPECTS TO RESUME SHIPPING OF SOME SOLID DOSAGE PRODUCTS EARLY THE WEEK OF AUG. 21; FDA BEGINS REVIEW OF 30 "MOST PRESCRIBED" GENERICS AUG. 14

Executive Summary

Par may be able to resume shipping some of its solid dosage form products early in the week of Aug. 21, the generic company indicated. Although Par halted shipments of all dosage forms of tablets and capsules during the week of Aug. 7 while it conducts an internal review, the company expects to begin reshipping products incrementally as they are cleared. Par voluntarily suspended shipments of all of its almost 150 solid dosage form products at the request of FDA. Par said it is reviewing each marketed product to determine whether their batch records meet ANDA specifications. The company is also looking at inventory records. Quad's injectables line, to date, has not been affected. Upon the completion of each product review, Par said it will advise FDA of the results and receive comments from the agency. Reviewed on a case-by-case basis, the products that fail will be recalled and those that pass specifications will be cleared for shipping. * In the last two weeks, Par has recalled three products for failure to meet stability testing standards. Par most recently recalled two lots of dipyridamole 25 mg (Boehringer Ingelheim's Persantine). Earlier recalls include the decongestant Par Decon and dexachlorpheniramine maleate ("The Pink Sheet" Aug. 14, T&G-9). FDA began an inspection of Par in May after the generic investigation discovered that several of the firm's top management had paid illegal gratuities to FDA reviewers. In addition to finding several GMP violations, which resulted in recalls, FDA inspectors also had unresolved questions about several Par products. The company's decision to halt shipping and review its product line was undertaken to answer these issues. In an Aug. 16 third quarter sales and earnings report, Par said it is "proceeding with its previously announced internal investigation and the investigation being conducted by independent consultants." The company said it "expected production levels to be significantly reduced during the investigation and that it expects to report substantially reduced levels of sales in its oral solid product line for at least the next quarter." Par estimated that the products affected by the halt in distribution represented about 40% of its $ 27.6 mil. in third quarter sales -- or roughly $ 40 mil. in annual sales. Par has been plagued by regulatory and legal issues since the discovery that Senior VP Ashok Patel had paid illegal gratuities to FDA officials. More recently, Par Senior VP R. K. Patel was involved in switching samples of a product during an FDA inspection. The company has recalled a total of seven products in the last month, and FDA recently revoked an ANDA for the muscle relaxant chlorzoxazone, approved in April, citing manufacturing problems. * On Aug. 17, four Par execs -- President Perry Levine, Exec-VP Jeffrey Levine, VP-Regulatory Affairs Barry Geller, and former Quality Assurance Manager Jay Patel (now in Regulatory Affairs) -- received subpoenas to appear at a Sept. 11 hearing before Rep. Dingell's Energy & Commerce/Oversight Subcommittee. Ashok Patel and R. K. Patel may also be requested to appear before the subcommittee. FDA began its own sample review of the 30 top-selling generic drugs on Aug. 14. Sample collection is expected to be completed early in the week of Aug. 21. In an Aug. 16 "Talk Paper," FDA said that "at present, about half of the samples have been collected by FDA field offices around the country." The agency estimated that it will "eventually collect more than 1,000 samples of manufactured or labeled generic products." Analysis of the samples by FDA is expected to take much longer. According to the agency, testing of the samples could take up to two months. The testing, being conducted at 14 FDA field laboratories nationwide, will include "potency, dissolution, composition, and other specifications," FDA said. FDA is focusing its generic drug sampling on distributor and repackager warehouses. The agency said that it is analyzing the samples "to ensure that they all conform to specifications provided the agency" in the original ANDAs. FDA plans to collect samples from all manufacturers of the 30 generic drugs, as well as "own label" distributors. A sample of each brandname product also will be collected and analyzed, FDA said. "If any safety problem arises in either a generic or a brandname product, an announcement and recall will be promptly made," the "Talk Paper" notes. Staff of the House Commerce/Oversight Subcommittee, which initiated the investigation into the generic drug approval process, indicated that Chairman Dingell (D-Mich.) can be expected "to be very pleased" about FDA's action. During the week of Aug. 21, the congressman is scheduled to return to Washington from a trip to Poland. Generic Pharmaceutical Industry Association President Dee Fensterer praised the sampling effort. She maintained that GPIA has "always called for strong enforcement of FDA regulations." The effort "is a standard operating procedure, although it is stepped up in the current situation," she added. GPIA Chairmen William Haddad, vice chairman of Danbury Pharmacal, suggested that the sampling program restrict to a "finite period" any public uncertainty until confidence in generic drug products is restored. Haddad estimated that the sampling and testing effort will be completed in "a couple of weeks." Haddad predicted that, although a small number of additional problems may be uncovered, the program will demonstrate the safety and effectiveness of "the vast majority" of products. He added that the generic industry will "be fine" until the effort is completed. Another effect of the FDA sampling may be "to vindicate the industry," Barr VP-Trade and Professional Relations Kathleen McGee commented. She added that she believes no additional wrong-doers will be uncovered because those who cheat the system have already been identified. Barr has petitioned the agency to revoke ANDA approvals of Par, Quad, American Therapeutics, Pharmaceutical Basics, and Vitarine on the grounds that they obtained them through spurious or outright fraudulent means ("The Pink Sheet" Aug. 14, T&G-10). The generic drug products that have been targeted by FDA's sampling effort include: amoxicillin trihydrate, penicillin VK, ampicillin, prednisone, tetracycline HCl, hydrochlorothiazide, doxycycline hyclate, ibuprofen, erythromycin stearate, acetaminophen/codeine, erythromycin base, cephalexin, amitriptyline HCl, furosemide, diazepam, phenobarbital, hydrocortisone cream, trimethoprim-sulfamethoxazole, dipyridamole, nitroglycerin, nystatin, triamcinolone, propoxyphene-N/APAP, lorazepam, imipramine HCl, thyroid, metronidazole, meclizine HCl, allopurinol, ferrous sulfate.

Par may be able to resume shipping some of its solid dosage form products early in the week of Aug. 21, the generic company indicated.

Although Par halted shipments of all dosage forms of tablets and capsules during the week of Aug. 7 while it conducts an internal review, the company expects to begin reshipping products incrementally as they are cleared. Par voluntarily suspended shipments of all of its almost 150 solid dosage form products at the request of FDA.

Par said it is reviewing each marketed product to determine whether their batch records meet ANDA specifications. The company is also looking at inventory records. Quad's injectables line, to date, has not been affected.

Upon the completion of each product review, Par said it will advise FDA of the results and receive comments from the agency. Reviewed on a case-by-case basis, the products that fail will be recalled and those that pass specifications will be cleared for shipping.

* In the last two weeks, Par has recalled three products for failure to meet stability testing standards. Par most recently recalled two lots of dipyridamole 25 mg (Boehringer Ingelheim's Persantine). Earlier recalls include the decongestant Par Decon and dexachlorpheniramine maleate ("The Pink Sheet" Aug. 14, T&G-9).

FDA began an inspection of Par in May after the generic investigation discovered that several of the firm's top management had paid illegal gratuities to FDA reviewers. In addition to finding several GMP violations, which resulted in recalls, FDA inspectors also had unresolved questions about several Par products. The company's decision to halt shipping and review its product line was undertaken to answer these issues.

In an Aug. 16 third quarter sales and earnings report, Par said it is "proceeding with its previously announced internal investigation and the investigation being conducted by independent consultants." The company said it "expected production levels to be significantly reduced during the investigation and that it expects to report substantially reduced levels of sales in its oral solid product line for at least the next quarter."

Par estimated that the products affected by the halt in distribution represented about 40% of its $ 27.6 mil. in third quarter sales -- or roughly $ 40 mil. in annual sales.

Par has been plagued by regulatory and legal issues since the discovery that Senior VP Ashok Patel had paid illegal gratuities to FDA officials. More recently, Par Senior VP R. K. Patel was involved in switching samples of a product during an FDA inspection. The company has recalled a total of seven products in the last month, and FDA recently revoked an ANDA for the muscle relaxant chlorzoxazone, approved in April, citing manufacturing problems.

* On Aug. 17, four Par execs -- President Perry Levine, Exec-VP Jeffrey Levine, VP-Regulatory Affairs Barry Geller, and former Quality Assurance Manager Jay Patel (now in Regulatory Affairs) -- received subpoenas to appear at a Sept. 11 hearing before Rep. Dingell's Energy & Commerce/Oversight Subcommittee. Ashok Patel and R. K. Patel may also be requested to appear before the subcommittee.

FDA began its own sample review of the 30 top-selling generic drugs on Aug. 14. Sample collection is expected to be completed early in the week of Aug. 21. In an Aug. 16 "Talk Paper," FDA said that "at present, about half of the samples have been collected by FDA field offices around the country." The agency estimated that it will "eventually collect more than 1,000 samples of manufactured or labeled generic products."

Analysis of the samples by FDA is expected to take much longer. According to the agency, testing of the samples could take up to two months. The testing, being conducted at 14 FDA field laboratories nationwide, will include "potency, dissolution, composition, and other specifications," FDA said.

FDA is focusing its generic drug sampling on distributor and repackager warehouses. The agency said that it is analyzing the samples "to ensure that they all conform to specifications provided the agency" in the original ANDAs.

FDA plans to collect samples from all manufacturers of the 30 generic drugs, as well as "own label" distributors. A sample of each brandname product also will be collected and analyzed, FDA said. "If any safety problem arises in either a generic or a brandname product, an announcement and recall will be promptly made," the "Talk Paper" notes.

Staff of the House Commerce/Oversight Subcommittee, which initiated the investigation into the generic drug approval process, indicated that Chairman Dingell (D-Mich.) can be expected "to be very pleased" about FDA's action. During the week of Aug. 21, the congressman is scheduled to return to Washington from a trip to Poland.

Generic Pharmaceutical Industry Association President Dee Fensterer praised the sampling effort. She maintained that GPIA has "always called for strong enforcement of FDA regulations." The effort "is a standard operating procedure, although it is stepped up in the current situation," she added.

GPIA Chairmen William Haddad, vice chairman of Danbury Pharmacal, suggested that the sampling program restrict to a "finite period" any public uncertainty until confidence in generic drug products is restored. Haddad estimated that the sampling and testing effort will be completed in "a couple of weeks."

Haddad predicted that, although a small number of additional problems may be uncovered, the program will demonstrate the safety and effectiveness of "the vast majority" of products. He added that the generic industry will "be fine" until the effort is completed.

Another effect of the FDA sampling may be "to vindicate the industry," Barr VP-Trade and Professional Relations Kathleen McGee commented. She added that she believes no additional wrong-doers will be uncovered because those who cheat the system have already been identified. Barr has petitioned the agency to revoke ANDA approvals of Par, Quad, American Therapeutics, Pharmaceutical Basics, and Vitarine on the grounds that they obtained them through spurious or outright fraudulent means ("The Pink Sheet" Aug. 14, T&G-10).

The generic drug products that have been targeted by FDA's sampling effort include: amoxicillin trihydrate, penicillin VK, ampicillin, prednisone, tetracycline HCl, hydrochlorothiazide, doxycycline hyclate, ibuprofen, erythromycin stearate, acetaminophen/codeine, erythromycin base, cephalexin, amitriptyline HCl, furosemide, diazepam, phenobarbital, hydrocortisone cream, trimethoprim-sulfamethoxazole, dipyridamole, nitroglycerin, nystatin, triamcinolone, propoxyphene-N/APAP, lorazepam, imipramine HCl, thyroid, metronidazole, meclizine HCl, allopurinol, ferrous sulfate.

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