“Serious“ FDA Observation at Zimmer Biomet Warsaw Plant
Walter Eisner • Wed, February 1st, 2017
Zimmer Biomet Holdings, Inc. has a lot of 'splaining to do to the FDA after an inspection of the company's Warsaw, Indiana, plant resulted in one the "longest and most serious" 483s ever encountered by a legal expert quoted by Wells Fargo Analyst, Larry Biegelsen.
FDA 483s are "Inspectional Observations," used by the FDA to document and communicate concerns discovered during inspections. They do not represent a final determination regarding a company's compliance.
Over the course of three one-week blocks, the agency conducted an inspection at the company and issued a 60-page heavily redacted Form 483 in November.
North Campus Concerns
Prior to the FDA inspection the company completed internal audits of its North Campus in the first half of 2016. According to a January 30, 2017 analyst report by RBC's Glenn Novarro, these audits identified several compliance-related issues, and a remediation program was established in July 2016. This program identified 7 of the 14 Form-483 observations and 6 of the 15 discussion points prior to the start of the FDA's inspection.
Biegelsen wrote in mid-December that the 60 heavily redacted pages of the 483 appears to be "severe", but is unlikely to have a material impact on the business in the near-term because the issues found by the FDA do not impact product approvals and are unlikely to lead to an injunction.
Biegelsen said his legal consultant said the 483 was likely to result in Zimmer Biomet receiving a warning letter. The consultant believes it will take the company at least a year to address all issues and will call for a re-inspection sometime in 2018.
The FDA went to considerable efforts to document what the agency perceives as significant violations, added Biegelsen. "The 483 does not simply provide an example or two of deficiencies, but it provides multiple examples. It is unusual to be so thorough in documenting a company's perceived shortcomings."
Biegelsen's legal expert said the FDA wrote the 483s in such a way as to argue that these were not just technical violations, but ones that potentially go to safety, e.g., whether products were properly sterilized or steps adequately documented so that the safety is known.
One example of the 483 involves a 21-page "Observation" that is identified as a repeat observation. Biegelsen wrote that it does not appear that any other observation was deemed a repeat. "Our FDA consultant does not recall ever seeing a 21-page single observation. FDA not only documented that this was a repeat observation, but went to great lengths to document myriad manifestations that the company failed to comply with FDA's regulations."
Company Says No Safety Concerns
The company reportedly said no patient safety concerns have been identified with any of the products manufactured at the site and is preparing a written response to the 483 observations and has developed a remediation plan to fully address the issues cited by the agency. This work, the company noted, “is progressing well.”
Remediation efforts at the North Campus were accelerated as additional issues were identified by the FDA during the inspection, wrote Novarro.
"Product ship holds were issued on September 29th to stop shipments of all final products cleaned, sterile packaged, and sterilized at the North Campus. Initial product ship hold releases under interim controls began on October 21st. Separately, none of the health hazard evaluations completed to date have resulted in any field actions."
"We believe the North Campus remediation will last through 2018. Additionally, [the company] has performed a network-wide corporate audit of all sites with end of the line operations (cleaning, sterile packaging, sterilization).
"Finally, [the company] has made multiple recent management changes including a new SVP, Global Operations and Logistics and a new VP, Quality Assurance, in addition to several other positions.”
Novarro wrote on January 30, 2017 that management plans to submit its next full progress update to the FDA on or before February 17th.