Shares in Ranbaxy Laboratories have collapsed after the US Food and Drug Administration slapped an import alert on another of the company’s facilities in India, due to a failure to meet manufacturing requirements.
This means that US officials may detain any drugs produced at Mohali and the firm will remain on the import alert until it complies with current good manufacturing practices. Ranbaxy is now required to hire a third-party expert to conduct a thorough inspection of the facility “and certify to the FDA that the facilities, methods, processes, and controls are adequate to ensure continuous compliance with CGMP”, the agency says.
Howard Sklamberg, director of the Office of Compliance in the FDA’s Center for Drug Evaluation and Research, said the agency is committed to using “the full extent of its enforcement authority to ensure that drugs made for the U.S. market meet federally mandated quality standards”. He added that “we want American consumers to be confident that the drugs they are taking are of the highest quality, and the FDA will continue to work to prevent potentially unsafe products from entering the country”.
This is a huge blow to Ranbaxy, given that two other plants, Dewas and Paonta Sahib, have been on FDA import alert since 2008. In May, the Gurgaon-based group pleaded guilty to felony charges related to drug safety and confirmed an agreement to pay $500 million in fines under a settlement with the US Department of Justice,
Shares in Ranbaxy, which is majority-owned by Daiichi Sankyo, had been rising steadily since the news of that fine but this latest FDA ban has scuppered the stock, pushing it down over 30%. These means that the three plants in India the company uses to manufacture treatments for the USA cannot ship product to a market that makes up over 40% of Ranbaxy sales.