Quality violations cost Genzyme US$175m in profits
Consent decree filed and subject to court approval
Genzyme. has signed a consent decree agreeing to correct manufacturing quality violations at its manufacturing facility in Allston, Massachusetts, and will turn over to the US government US$175m in unlawful profits from the sale of products that were made at the plant. The payment is known as a disgorgement in which a company must give up profits obtained by improper or illegal acts.
Under the consent decree of permanent injunction, the company agreed to adhere to a strict timetable to bring the plant in line with the regulatory requirements of the FDA. The decree was filed in the US District Court for the District of Massachusetts on 24 May 2010, and is subject to court approval.
Genzyme is a sole supplier of several enzyme replacement drugs for injection that are used to treat rare genetic disorders. During an inspection of the Allston plant last year, FDA inspectors found that the company's systems for ensuring manufacturing quality were inadequate resulting in production delays, critical shortages of medically necessary products to consumers and drugs contaminated with metal, fibre, rubber and glass particles.
These manufacturing problems violated the FDA’s regulations for manufacturing practice. Genzyme also temporarily suspended manufacturing of some products due to a viral contamination in a bioreactor that makes bulk amounts of its drugs. This resulted in additional drug shortages.
‘It is critical for the safety of the drug supply that companies comply with basic manufacturing standards. FDA takes these obligations very seriously and expects manufacturers to do the same,’ said Dr Joshua Sharfstein, FDA principal deputy commissioner.
Genzyme has agreed to a work plan for making facility improvements. It begins with selecting, within 10 days of entry of the decree by the court, an independent expert who will inspect the plant and issue recommendations. Genzyme will use the expert’s recommendations to create a work plan, subject to FDA approval, that requires specific steps for bringing its Allston plant into compliance within given dates.
If Genzyme fails to complete any step specified in the work plan, the company will have to pay a substantial fine. In addition, the consent decree provides a deadline for Genzyme to transfer its operations for filling drug vials from its Allston facility to other manufacturing sites or else it will have to disgorge further profits from the sales of drugs filled at Allston after that specific date.