raises more concerns about Ranbaxy's India plants; shares fall
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[January 13, 2014]
MUMBAI (Reuters) — The Food and Drug Administration (FDA) has raised
concerns about the manufacturing practices at a factory owned by Ranbaxy Laboratories Ltd, the Indian drugmaker said on Monday,
sending its shares down to nearly a one-month low.
All of Ranbaxy's India-based factories are currently
banned by the FDA from exporting medicines to the United States, the
company's largest market, after the regulator's inspection found
violation of its so-called good manufacturing practices.
The company, India's biggest drugmaker by sales, said the FDA had
now filed "certain observations" about its Toansa pharmaceutical
ingredients plant in the northern state of Punjab.
Failure to address these concerns would result in the FDA banning
all exports to the United States from the factory.
"The company is assessing the observations, and will respond to the
FDA in accordance with the agency's procedure to resolve the
concerns at the earliest," Ranbaxy said in a statement. It did not
give further details.
Shares in Ranbaxy, 63.5 percent owned by Japan's Daiichi Sankyo Co,
fell as much as 9.1 percent on Monday to 421.10 rupees, its lowest
level in nearly a month, while the main Mumbai market index was up
Indian drugmakers are among the world's biggest producers of cheap
generic medicines, as developed nations battle rising healthcare
costs and big-selling drugs going off-patent in the lucrative U.S.
The rise in demand for generic drugs has led to closer
regulatory scrutiny and sanctions imposed on top drugmakers
including Ranbaxy and Wockhardt Ltd.
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Last September, the FDA imposed an import ban on Ranbaxy's
factory in Mohali in northern India, saying it had not met "good
The ban on its Mohali factory came after the company pleaded guilty
in May to U.S. felony charges related to drug safety and agreed to a
record $500 million in fines.
(Reporting by Sumeet Chatterjee; editing
by Miral Fahmy)
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