US to probe FDA role in Ranbaxy case

US to probe FDA role in Ranbaxy case
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First Published: Thu, Jul 17 2008. 10 44 PM IST
Updated: Thu, Jul 17 2008. 10 44 PM IST
New Delhi: On going US regulatory interest in Ranbaxy Laboratories Ltd’s operations in that country refuses to die down, with a congressional committee reported as saying that it will launch an investigation into the way the drug regulator there has handled the inquiry and see if they knowingly let the Indian drug maker sell adulterated and misbranded medicines in the world’s largest drug market.
The development—reported first by New Jersey-based daily The Star-Ledger on Thursday—will be the latest salvo in an ongoing controversy that has taken a toll on Ranbaxy shares. Shares of the Gurgaon-based drug maker slid 3.93% on Thursday to close at Rs452.20 each on the Bombay Stock Exchange whose benchmark index climbed 4.26%.
The energy and commerce committee of the US House of Representatives, according to The Star-Ledger, will ask the US Food and Drug Administration (FDA) why they continued to give approvals to Ranbaxy for selling more medicines if its manufacturing practices were under investigation. The committee, states the US daily, will also “examine Ranbaxy’s drug approvals in the United States and potential violations of manufacturing regulations”.
US investigators filed a case in the district court of Maryland on 3 July, asking Ranbaxy to furnish documents as part of their investigations against the company for allegedly falsifying records, which led to the sale of generic drugs in the US that did not meet the country’s quality standards.
Ranbaxy, which has denied the allegations in the past, said on Thursday that it did not have any knowledge of the latest development. “We are not aware of any congressional committee inquiry and have not received any communication in this regard,” a company spokesman said in an email response. “All our plants are CGMP (current good manufacturing practices, an industry benchmark) compliant and produce medicines that meet global norms.”
If the allegations made by the federal investigators are true, “Ranbaxy has imperilled the safety of Americans in a manner similar to the generic drug scandal we uncovered 20 years ago. I would like to know whether FDA officials knew about these allegations and what, if any, action was taken”, John Dingell, the chairman of the committee, was quoted as saying in The Star-Ledger. The committee’s thinking could not be independently verified by Mint. Calls to Dingell’s office until late evening, India time, were not answered.
FDA spokesperson Julie Zawisza said in an email that the agency had not received an official communication from the congressional committee. “When we do receive this inquiry, we will review it and prepare a response,” she added. Zawisza declined further comment because FDA is “conducting an investigation of Ranbaxy”.
The report of the congressional interest makes the situation more tough for Ranbaxy, an analyst said. “This development adds to the uncertainty” around the issue, said Ranjit Kapadia, head of research at Prabhudas Lilladher Pvt. Ltd, who expects the US federal investigation to get expedited hereafter. “Now, it should be taken on the fast track.”
In an independent statement issued earlier on Thursday, Ranbaxy reiterated that a buyout deal with Daiichi Sankyo Co. Ltd, which will see the Singh family, Ranbaxy’s promoters, selling their 34.8% stake, was “binding and final, subject to regulatory approvals”, and confirmed that the terms of the deal remained unchanged.
In an interview with Mint on Wednesday, company managing director Malvinder M. Singh expressed surprise that a “motion to compel” had been filed by US investigators.
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First Published: Thu, Jul 17 2008. 10 44 PM IST
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