said Chairman and Chief Executive Dhananjay G. Wadekar will resign from the company, an announcement the generic-drug maker made just two hours after saying possible problems in its laboratory testing practices will lead to additional product recalls.
The company has decided to temporarily suspend shipments of each of its products until it can be assured that its manufacturing and testing procedures are adequate.
Shares of Able were plunging $19.02, or 77%, to $5.61 in heavy
trading. By 1 p.m. EDT, more than 10 million shares had changed hands, compared with the average daily volume of roughly 245,000 shares.
The Cranbury, N.J., company has been conducting an internal compliance review. In its 10-Q for the quarter ended March 31, Able said that after experiencing several recent product recalls due to various improper lab practices, it notified the Food and Drug Administration and initiated an evaluation.
Able said it has now "identified apparent departures from standard operating procedures with respect to certain laboratory testing practices. As a result of these observations, the company will be recalling additional products in the future."
The review is proceeding based on protocols established by outside consultants. The company believes that the protocols are scientifically valid, but time-consuming, meaning Able hasn't yet confirmed the extent to which testing of its products was appropriate or not.
Able said it doesn't know what added actions it may have to take or what the FDA might do. The shipment disruption, even if it's temporary, is expected to have a "material effect" on the company's ability to meet its sales goals and operating targets. That being the case, Able withdrew its prior financial guidance.
With Wadekar resigning, Robert G. Mauro, Able's president and chief operating officer, will assume the role of interim CEO. Able expects Wadekar to continue assisting the company as a consultant.