FDA may inspect one Ranbaxy plant in fiscal 2017: Dilip Shanghvi
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Mumbai: India’s largest drug maker Sun Pharmaceutical Industries Ltd on Tuesday said the US drug regulator may start re-inspecting by the middle of 2016-17 one of the four Ranbaxy Laboratories Ltd plants banned from exporting to the US.
The US Food and Drugs Administration (USFDA) had banned products from Ranbaxy’s plants in Mohali, Dewas, Paonta Sahib in 2012, and Toansa in 2014, from exporting to the US, after the company was found to have violated good manufacturing practices.
Sun Pharma, which agreed to acquire Ranbaxy in an all-stock transaction at an enterprise value of $4 billion in April 2014, had said in December 2015 that remedial actions at Ranbaxy plants were on track.
Speaking at a conference call on Tuesday, Sun Pharma managing director Dilip Shanghvi said a total synergy of about $300 million can be expected by FY18 through Ranbaxy integration.
The Ranbaxy acquisition, which was completed in March 2015, made Sun Pharma the world’s fifth-largest specialty generic pharmaceuticals company. “We are working towards the fulfilment of the requirements of the US consent decree and will try to expedite the resolution for at least one of these facilities,” Shanghvi had said in December.
Sun Pharma has recorded a 92% rise in consolidated net profit for the March quarter at Rs.1,714 crore from Rs.889 crore a year ago.
For the full financial year, the group posted a net profit of Rs.4,716 crore, up 4% from Rs.4,540 crore for the year ended 31 March 2015. Total income increased to Rs.28,729 crore from Rs.27,843 crore during the previous fiscal, up 3%.
For FY16, sales from the US market were $2 billion, recording a decline of 8%. Shanghvi said that sales in the US got adversely impacted by pricing competition.
The company expects its newly acquired branded drug business in Japan will generate revenue from second half of FY17. In March, Sun Pharma had acquired Novartis’ branded drug portfolio in Japan for $293 million.
Last week, Sun Pharma’s US arm had received summons from the antitrust division of the US department of justice (DoJ), requiring it to appear before a grand jury there. However, Shanghvi did not disclose the details while saying the company is cooperating with the DoJ and providing the details and that it’s not a product-specific investigation.
The US DoJ had sought documents relating to corporate and employee records, generic pharmaceutical products and pricing, communications with competitors and others regarding sales of generic pharmaceutical products and certain other related matters.
“This has been a year of consolidation for us. While we have accrued targeted synergies from the Ranbaxy acquisition, we have also made commensurate investments in building the specialty business in the US. These strategic investments will help us drive the sustainable growth of our business,” Shanghvi said during the result announcement.
Sun Pharma is ranked No. 1 and holds approximately 8.8% market share in the Rs.98,000 crore pharmaceutical market, according to the March 2016 AIOCD-AWACS report.