Shares of pharma company Wockhardt Ltd are locked in a selling freeze, down by 4.99 per cent in the wake of the decision of the Medicines and Healthcare Products Regulatory Agency, United Kingdom (UKMHRA), to withdraw the Good Manufacturing Practice (GMP) certificate issued to its manufacturing unit at Aurangabad and to issue a restricted GMP certificate to the facility along with a statement of non-compliance.
Circuit filter
In both the exchanges, there were only sellers with no buyers and the stock apparently escaped free fall because of the circuit filter set by the exchanges to restrict the trading volatility in shares and in case of Wockhardt, it was set at 4.99 per cent.
In its filings with the stock exchanges, Wockhardt said that the GMP certificate will be "conditioned to permit continued manufacturing and QC testing'' of "critical'' products in situations where it has been agreed by the national competent authority or EMA (as appropriate) that there is "no feasible alternative in the market concerned''.
The company said that the scope of statement of non-compliance was "therefore limited to medicinal products considered non-critical to public health'' and it would be able to manufacture and supply from the Aurangabad facility certain medicinal products "critical to public health''.
Impact on existing biz
Worckhardt said that what impact the UKMHRA would have on the existing business would be clear only when it received further communication from UKMHRA. The facility contributed nearly £12 million to its consolidated income from the UK and EU markets.
Stock price
Shares of Wockhardt hit the lower circuit of 4.99 per cent or a loss of Rs 26.25 both on the BSE and NSE to reach the maximum fall limit set for the stock.
On the BSE, the stock was frozen at Rs 499.30 and on the NSE, the price was Rs 499.65. While 14,000 shares were traded on the BSE, on the NSE the traded volume was 44,644 shares.
There were sellers for 1,31,148 shares on the BSE, while on the NSE, 3,32,341 shares were listed for sale with no buy quotes in both the exchanges.
The stock has suffered a huge erosion in value after touching a 52-week high of Rs 2,166.05 in the BSE on March 12 this year in the wake of regulatory action in key markets like the US and UK.