KV Pharmaceutical Enters Into Consent Decree With FDA
March 02 2009 - 8:30AM
PR Newswire (US)
Decree outlines path forward to resume manufacturing at KV
facilities ST. LOUIS, March 2 /PRNewswire-FirstCall/ -- KV
Pharmaceutical Company (NYSE:KVa/KVb) today announced that it has
entered into a consent decree with the U.S. Food and Drug
Administration (FDA) regarding the company's drug manufacturing and
distribution. The decree provides a series of measures that, when
satisfied, will permit KV to resume the manufacture and
distribution of products marketed by its subsidiaries, ETHEX and
Ther-Rx. The Company is working expeditiously to satisfy the
requirements and expects to provide further information in upcoming
communications. As part of the consent decree, KV has agreed not to
market products it manufactures until it has satisfied certain
requirements designed to demonstrate compliance with FDA's current
good manufacturing practices (CGMP) regulations. KV has also agreed
that it will not distribute certain products, including its
prenatal vitamins and hematinic products, until the products are
approved by FDA's ANDA or NDA processes. "We have been working
diligently with the FDA for the last two months to reach agreement
on a clear path forward to permit KV to resume manufacturing and
marketing its products," said David A. Van Vliet, KV's Interim
Chief Executive Officer. "Since December, when new management took
over at KV, our team has taken significant steps to enhance our
systems and procedures, and we will continue to do so. We look
forward to cooperating with the FDA during this process that will
facilitate our return to the market. Predicting the timing for the
return and the ultimate product assortment that we will market are
presently very difficult due to the range of variables that must be
managed. As we gain certainty, we will notify customers and all
other stakeholders." The consent decree provides that, before
resuming manufacturing, KV will have an independent third party
CGMP expert consultant undertake a review of KV's facilities and
certify compliance with FDA's CGMP regulations. Following that
certification, FDA will make a determination as to whether the KV
facilities are in compliance. The decree further provides that KV
may request of FDA that it be permitted to resume manufacturing and
distribution of certain products before the company is cleared by
FDA to resume full operations. KV has already retained the third
party CGMP expert consultant, which has been on-site for several
weeks. The consent decree is expected to be submitted today to the
U.S. District Court, Eastern District of Missouri, Eastern Division
by the Department of Justice and is subject to approval by the
Court. About KV Pharmaceutical Company KV Pharmaceutical Company is
a fully integrated specialty pharmaceutical company that develops,
manufactures, markets, and acquires technology-distinguished
branded and generic/non-branded prescription pharmaceutical
products. The Company markets its technology distinguished products
through ETHEX Corporation, a subsidiary that competes with branded
products, and Ther-Rx Corporation, the company's branded drug
subsidiary. For further information about KV Pharmaceutical
Company, please visit the Company's corporate Web site at
http://www.kvpharmaceutical.com/. Cautionary Note Regarding
Forward-looking Statements The information in this press release
may contain various forward-looking statements within the meaning
of the United States Private Securities Litigation Reform Act of
1995 ("PSLRA") and which may be based on or include assumptions
concerning the operations, future results and prospects of KV
Pharmaceutical company (the "Company"). Such statements may be
identified by the use of words like "plan," "expect," "aim,"
"believe," "project," "anticipate," "commit," "intend," "estimate,"
"will," "should," "could" and other expressions that indicate
future events and trends. All statements that address expectations
or projections about the future, including without limitation,
product development, product launches, regulatory approvals, market
position, acquisitions, revenues, expenditures, resumption of
manufacturing and distribution of products and the impact of the
recall and suspension of shipments on revenues, and other financial
results, are forward-looking statements. All forward-looking
statements are based on current expectations and are subject to
risk and uncertainties. In connection with the "safe harbor"
provisions, the Company provides the following cautionary
statements identifying important economic, political and
technological factors, which among others, could cause actual
results or events to differ materially from those set forth or
implied by the forward-looking statements and related assumptions.
Such factors include (but are not limited to) the following: (1)
changes in the current and future business environment, including
interest rates and capital and consumer spending; (2) the
difficulty of predicting FDA approvals, including timing, and that
any period of exclusivity may not be realized; (3) acceptance and
demand for new pharmaceutical products; (4) the introduction and
impact of competitive products and pricing, including as a result
of so-called authorized-generic drugs; (5) new product development
and launch, including the possibility that any product launch may
be delayed or that product acceptance may be less than anticipated;
(6) reliance on key strategic alliances; (7) the availability of
raw materials and/or products manufactured for the Company under
contract manufacturing arrangements with third parties; (8) the
regulatory environment, including regulatory agency and judicial
actions and changes in applicable law or regulations; (9)
fluctuations in revenues; (10) the difficulty of predicting
international regulatory approval, including timing; (11) the
difficulty of predicting the pattern of inventory movements by the
Company's customers; (12) the impact of competitive response to the
Company's sales, marketing and strategic efforts, including the
introduction or potential introduction of generic or competing
products against products sold by the Company and its subsidiaries;
(13) risks that the Company may not ultimately prevail in
litigation, including challenges to the Company's intellectual
property rights by actual or potential competitors or to the
Company's ability to market generic products due to brand company
patents and challenges to other companies' introduction or
potential introduction of generic or competing products by third
parties against products sold by the Company or its subsidiaries,
including without limitation the litigation and claims referred to
in Note 16 of the Notes to the Consolidated Financial Statements in
the Company's Form 10-Q for the quarter ended June 30, 2008; (14)
the possibility that the Company's current estimates of the
financial effect of certain announced product recalls could prove
to be incorrect; (15) whether any product recalls or product
introductions result in litigation, agency action or material
damages; (16) the possibility that the findings of the Audit
Committee inquiry referenced in the Company's Form 10-Q for the
quarter ended June 30, 2008, Form 12b-25 filed with the U.S.
Securities and Exchange Commission (the "SEC") on November 13,
2008, Form 12b-25 filed with the SEC on February 2, 2009, as well
as certain other of the Company's SEC filings, could have a
material impact on the Company's financial results; (17) the
satisfaction or waiver of the other closing conditions in the
previously disclosed Gestiva(TM) acquisition agreement; (18) the
possibility that the auction rate securities held by the Company
may not return to liquidity at their face value or at all; (19) the
Company's voluntary suspension of the production and shipment of
substantially all of the products that the Company manufactures and
the related nationwide recall affecting substantially all of the
products that the Company manufactures, as well as the expected
material adverse effect on the Company's revenue, assets and
liquidity and capital resources, all as more fully described in the
Company's Form 8-K filed with the SEC on January 26, 2009 and the
Company's Form 8-K filed with the SEC on February 26, 2009; (20)
the series of putative class action lawsuits alleging violations of
the federal securities laws by the Company and certain individuals,
and the initiation of lawsuits alleging violations under the
Employee Retirement Income Security Act (ERISA), all as more fully
described in the Company's Form 8-K filed with the SEC on January
26, 2009, as well as certain other of the Company's SEC filings;
(21) the informal inquiry initiated by the SEC and any related or
additional governmental investigative or enforcement proceedings,
including actions by the FDA and the U.S. Department of Justice,
all as more fully described in the Company's Form 8-K filed with
the SEC on January 26, 2009; (22) delays in returning the Company's
products to market, including loss of market share as a result of
the suspension of shipments, and related costs; and (23) the risks
detailed from time-to-time in the Company's filings with the SEC.
This discussion is not exhaustive, but is designed to highlight
important factors that may impact the Company's forward-looking
statements. The Company is under no obligation to update any of the
forward-looking statements after the date of this press release.
All forward-looking statements attributable to the Company are
expressly qualified in their entirety by the cautionary statements
in this "Cautionary Note Regarding Forward-looking Statements" and
the risk factors that are included under the heading "Item 1A--Risk
Factors" in the Company's Annual Report on Form 10-K for the year
ended March 31, 2008, as supplemented by the Company's subsequent
SEC filings. DATASOURCE: KV Pharmaceutical Company CONTACT: Michael
Anderson of KV Pharmaceutical, +1-314-645-6600 Web Site:
http://www.kvpharmaceutical.com/
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