Pfizer Recalls Birth Control Pills - Analyst Blog


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Pfizer Inc. ( PFE ) recently announced the voluntary recall of 28 lots or 1 million packs of its oral contraceptive pill, Lo/Ovral 28 (norgestrel and ethinyl estradiol), including 14 lots of the generic version of the product. The recall, conducted in the US with the knowledge of the Food and Drug Administration (FDA), was due to packaging issues.

Packaging Errors Led to the Recall

Based on an investigation, Pfizer found that some of the blister packs could contain the wrong amount of placebo (inert or inactive) tablets and the tablets could be out of sequence.

The pills come in blister packs which consist of  21 tablets of active ingredients and seven tablets of inert ingredients. Correct dosing and dosing sequence is, therefore, crucial for avoiding unplanned pregnancies. Although Pfizer recalled 1 million packs of the pill, it estimates that about 30 packs of birth control pills may have been affected by the packaging error.

The tablets, which are manufactured and packaged by Pfizer, are commercialized by Akrimax Rx Products under the Akrimax Pharmaceuticals brand.

Pfizer recommended that users affected by the packaging error should start using a non-hormonal form of contraception immediately.

Our Take

Although the packaging error does not present safety issues, it nevertheless poses a major problem for women taking the pills as it would expose them to inadequate contraception and unwanted pregnancies.

We note that Pfizer is not the only company to have initiated a voluntary recall of oral contraceptives. In mid-September 2011, Qualitest Pharmaceuticals, a wholly owned subsidiary of Endo Pharmaceuticals ( ENDP ), initiated a voluntary, nationwide, retail-level recall of multiple lots of oral contraceptives. The recall was also due to a packaging error, which could subject users to incorrect dosing and unwanted pregnancies.

While we do not expect Pfizer's revenues to be affected by the voluntary recall, the company could very well face lawsuits due to the packaging error. We currently have a Neutral recommendation on Pfizer, which carries a Zacks #3 Rank (short term Hold rating).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Business , Stocks
Referenced Stocks: ENDP , PFE

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