Novartis unit to take $120 million charge on recall
ZURICH (Reuters) - Novartis's consumer health unit will take a $120 million hit in the fourth quarter after the Swiss drugmaker decided to voluntarily recall some products in the United States and move to improve quality standards at manufacturing sites.
Novartis said in a statement on Sunday that operations and shipments had been temporarily stopped at the Novartis Consumer Health (NCH) Lincoln, Nebraska facility, to accelerate improvements at the site.
"NCH will take a one-time charge currently estimated at $120 million in the fourth quarter of 2011, relating to the recalls and improvement work at the Lincoln facility," Novartis said in the statement.
The group is recalling all lots of select bottle packaging configurations from retailers of Excedrin and NoDoz products with expiry dates of December 20, 2014 or earlier as well as Bufferin and Gas-X Prevention products with expiry dates of December 20, 2013 or earlier, in the United States.
Novartis said there had not been any adverse events reported and that the U.S. Food and Drug Administration (FDA) was aware of the recall.
The products are being recalled due to an internal product review and complaints that identified issues such as broken gelcaps, chipped tablets and inconsistent bottle packaging line clearance practices, where a potential for a tablet mix up could not be ruled out.
Novartis plans to gradually resume operations at its Lincoln site following implementation of planned improvements and in agreement with the FDA.
The Lincoln facility produces a variety of products mainly for the market with annual sales value of less than 2 percent of Novartis Group sales, Novartis said.
(Reporting by Katie Reid; Editing by Bernard Orr)