Dr. Reddy's banned from China's drug procurement program after inspectors turn up manufacturing problems
Dr. Reddy’s has been cut off from China’s bulk-buy drug procurement program after an inspection turned up “serious defects” in the company’s manufacturing operations. Following a remote inspection of a Dr. Reddy’s formulations production plant, China’s National Medical Products Administration (NMPA) has suspended the import, sale and use of the Indian drugmaker’s atomoxetine hydrochloride capsules for attention-deficit/hyperactivity disorder (ADHD). The ban took hold Aug. 30, according to a release (Chinese) from China’s National Healthcare Security Administration (NHSA).
China’s National Joint Procurement Office, which oversees the country’s volume-based procurement (VBP) system, has canceled a supply contract for the Dr. Reddy’s drug and added the manufacturer to its “Violation List,” the NHSA release states.
As a result, Dr. Reddy’s is prohibited from taking part in China’s drug procurement scheme through Feb. 28, 2026, the NHSA added.
China’s VBP was set up in 2018 to help cut the costs of off-patent drugs. The scheme requires manufacturers to go through a bidding process to supply products to public hospitals.
In a securities filing, Dr. Reddy’s said (PDF) it is now in the process of “ascertaining the monetary impact of the said orders.”
Atomoxetine is a non-stimulant SNRI medication used to treat ADHD. The drug was first approved in the U.S. in 2002 and was previously sold by Eli Lilly under the brand name Strattera. Lilly discontinued marketing of the branded drug in 2023 following an influx of generic versions around 2017.
As for Dr. Reddy’s manufacturing slights, China’s NMPA noted that the drugmaker’s production protocol for atomoxetine capsules had “serious defects in the management of raw materials.” NMPA also flagged “defects in process validation and quality control,” which failed to meet the bar for China’s national drug manufacturing standards.
Back in July, NMPA suspended the import, sale and use of Daewoong’s cephalosporin antibiotic cefodizime sodium injection after the Korean company declined to take part in an inspection of its production site. Daewoong, for its part, is unable to participate in China’s VBP activities until Jan. 17, 2026.
