Simcere Pharmaceutical Group ("Simcere" or the "Company") (NYSE: SCR), a leading pharmaceutical company specializing in the development, manufacturing, and marketing of branded generic and proprietary pharmaceuticals in China, today announced that Jiangsu Yanshen Biological Technology Stock Co., Ltd. ("Jiangsu Yanshen") has received disciplinary notice from China's State Food and Drug Administration ("SFDA") regarding its production of substandard quality human use rabies vaccine.
The SFDA has identified deception and avoidance of regulatory inspection at Jiangsu Yanshen during the second half of 2008 in the production of certain batches of human use rabies vaccine resulting in sales of those batches with potency below the national standard. As a result, the SFDA has revoked Jiangsu Yanshen's license for the manufacturing and marketing of human use rabies vaccine (vero cell) and freeze-dried human use rabies vaccine (vero cell).
In addition, the local investigative authority has informed Jiangsu Yanshen that they will file criminal prosecution against Jiangsu Yanshen and relevant members of its original management team in relation to the production and sale of the aforementioned products.
Simcere obtained a controlling stake in Jiangsu Yanshen on October 24, 2009, and subsequently discovered quality control problems relating to the production of Jiangsu Yanshen's human-use rabies vaccine. On November 23, 2009, Simcere urged the board of Jiangsu Yanshen to replace its general manager and head of quality assurance and demanded that Jiangsu Yanshen implement a total suspension of production effective on November 30, 2009 to facilitate internal inspection and rectification of its quality control systems. Jiangsu Yanshen has been actively cooperating with relevant authorities on the investigation. To date there have been no reported adverse events as a result of the vaccine batches in question.
Jiangsu Yanshen operations remain suspended and it is uncertain when it will resume vaccine production.
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