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Ansell fails quality test; US bars its condoms
September 17, 2005

Ansell was barred from exporting condoms from its Thailand plant to the United States on Friday after the products failed to meet rigorous safety standards during a random inspection.

The company subjects its condoms to internal water and electronic tests to ensure their quality, but the US Food & Drug Administration's even stricter examination revealed flaws.

The FDA has not yet told Ansell why the two lots of condoms tested failed to meet its guidelines.

The condoms, from Ansell's Surat Thani facility, have been placed on what is known as "Level 2 detention" and cannot be sent to the US.

For the restriction to be removed, at least 10 successive shipments will have to pass FDA tests.

If any of these shipments do not meet FDA standards, the detention will be raised to Level 3 and the plant will need to be recertified.

In that case, Ansell said it would have to supply the US consumer market with alternative products, affecting about 5 per cent of the company's total sales.

Last month, Ansell reported total sales of $824 million, up from $791 million the previous year.

In addition to condoms, Ansell sells other "barrier protection devices" such as latex gloves, rubber gloves and rainwear.

The US is Ansell's biggest market for its condoms, which are sold under brand names such as LifeStyles, Mates and Kama Sutra and come in many varieties such as "lasting pleasure", "good lovin' " and "warming".

The company sells other products, such as lubricant, under the well-known LifeStyle brand name and controls 11 per cent of the world condom market, making it the third-biggest seller of condoms.

An Ansell representative would not say which brand of condoms had been affected by the FDA restrictions.

Ansell was emphatic that the two shipments that missed FDA targets would not be sold in other markets such as Australia, Europe or developing countries, even if they met local standards.

This is not the first time Ansell has failed to meet FDA standards.

In October 2002, rubber gloves from one of its factories in Malaysia were placed under a detention order that was lifted in early 2003.

But as Ansell noted on Friday, FDA scrutiny is not unusual in the condom business.

Two of its competitors have had recent shipments placed under Level 1 detention.

Ansell said it made about 140 shipments to the US last year without incident.

Shares in the company had risen to $10.98 before news of the FDA restriction was released on Friday but fell to close 7c lower at $10.83.