How Trump's hydroxychloroquine push became a boon for Ipca Laboratories

In March, the Food and Drug Administration lifted restrictions on Ipca Laboratories Ltd. in Mumbai to allow it to export hydroxychloroquine and a similar drug, chloroquine. That happened just days after President Donald Trump touted them as potential game changers against the virus, despite a lack of clinical evidence they’d help.

The U.S. is still relying on Indian factories that were previously banned to import hydroxychloroquine needed by lupus and rheumatoid-arthritis patients even after the drug fell out of favor as a Covid-19 treatment.

In March, the Food and Drug Administration lifted restrictions on Ipca Laboratories Ltd. in Mumbai to allow it to export hydroxychloroquine and a similar drug, chloroquine. That happened just days after President Donald Trump touted them as potential game changers against the virus, despite a lack of clinical evidence they’d help.

Ipca’s factories had been banned from shipping to the U.S. since 2015 after inspectors discovered multiple violations of manufacturing standards, including manipulation of data gathered during routine quality checks.

On Tuesday, the FDA reversed its chloroquine import waiver for Ipca, the company said in a securities filing. It is still allowed to import hydroxychloroquine into the U.S.

Since Trump began pushing the drugs as a virus treatement, manufacturers have donated millions of pills to a national stockpile, reserved for Covid-19 patients. About 63 million tablets of hydroxychloroquine remain in the stockpile, Stephanie Bialek, a spokeswoman for the Department of Health and Human Services stockpile division, said in an email.

HHS has been in talks with the drugmakers about options for the millions of tablets, Bialek said. Novartis AG’s Sandoz unit donated 30 million tablets. Novartis is weighing its options and anything returned to the company “will not be used for commercial use,” Eric Althoff, a spokesman for Novartis, said in an email.

The Covid-19 demand left lupus patients on the lurch, and possibly forced to rely on drugs from Ipca. Between March and May, 55% of lupus patients had trouble filling their prescriptions for hydroxychloroquine or chloroquine, according to a Lupus Foundation of America survey released Tuesday. About 33% currently have problems getting access, according to a statement from the group.

About 5.9 million prescriptions for hydroxychloroquine were filled in the U.S. last year before it started being used heavily for Covid-19, according to data compiled by Bloomberg.

FDA’s reversal of Ipca’s waiver to import chloroquine came more than six weeks after a brief shortage of the drug was resolved as people prioritized hydroxychloroquine instead against Covid-19. The FDA’s exemption for hydroxychloroquine could also be lifted, depending on the supply situation, Ipca said the agency had warned.

The FDA waived Ipca’s ban to mitigate potential shortages and hydroxychloroquine is still in shortage, Michael Felberbaum, a spokesman for the agency, said in an email.

“Ipca agreed to perform additional quality mitigation steps prior to shipping the drugs for American patients,” he said.

In addition, “the agency is evaluating the supply to ensure it is adequate for patients who rely on these drugs as well as the need for these carve-outs,” Felberbaum said.

Chinese Ingredients
Ipca didn’t immediately respond to requests for comment. In April, the company said that despite its past troubles, it is prepared to meet U.S. manufacturing standards “and thus help mankind in the best possible way in these testing times.”

Ipca expects revenue to grow as much as 17% this year, in part due to hydroxychloroquine sales, the company said on an earnings call earlier this month. Ipca brought in $656 million in the year ending March 31, according to data compiled by Bloomberg. On that same call, company executives also revealed that the raw ingredients it uses to make hydroxychloroquine come from China.

The FDA has said as many as 80% of the key building blocks for drugs, called active pharmaceutical ingredients, come from overseas. China and India dominate active ingredient production for some crucial drugs like painkillers, antibiotics, and heart pills.

FDA inspectors have found many instances of quality failures ignored by drug-making factories in those countries, leading some in the Trump administration and Congress to question whether more pharmaceutical manufacturing should take place in the U.S. Including active ingredients, companies in India recently accounted for about 40% of all new generic drug approvals in the U.S. About 90% of what Americans take are generics.

Since the virus began spreading, some have questioned whether Chinese manufacturing quality is suffering. The fear is that corners are being cut to make up for lost productivity after the outbreak curbed manufacturing capacity.

Hydroxychloroquine and chloroquine are both approved to treat malaria. The FDA also cleared hydroxychloroquine for lupus and rheumatoid arthritis. Shortly after lifting the restrictions on Ipca, the FDA granted emergency authorization for the drugs to be used in hospitalized patients with Covid-19. Last week, the FDA revoked that, citing clinical evidence the drugs don’t work and are unsafe given associated cardiovascular risks.

The Lupus Foundation has helped broker a connection between a nonprofit hospital and an unnamed drugmaker that has excess hydroxychloroquine and wants to donate it to people with lupus, Mike Donnelly, a spokesman for the organization said. The talks are still ongoing.