Indian Pharma Ranbaxy Slammed by FDA

Posted by: Bruce Einhorn on September 17, 2008

Drug companies hoping to outsource production to low-cost locations in India are probably following closely the news about Ranbaxy Laboratories, arguably India’s premier drugmaker and a big seller of generic drugs in the U.S. and other markets. A foundation of the outsourcing and generics story is the safety and reliability of drugs made overseas. Regulators in the U.S. are now challenging that premise, at least as it applies to Ranbaxy. The Indian company took a major hit yesterday after the U.S. FDA announced a ban on the imports of 30 Ranbaxy-made products.

The FDA has been investigating the Indian company for a while (see this BusinessWeek story by my colleague Mehul Srivastava for a summary) but the company was trying to focus on its proposed merger with Daiichi Sankyu of Japan instead. After the comments yesterday from the FDA, that will be a lot harder. “Today’s actions are clearly warranted based on the extent and the seriousness of the violations uncovered during our inspections of these two sites,” Bloomberg reported FDA director of the food and drug compliance office Deborah M. Autor saying. “The firm is sufficiently out of control that we think an import alert should be put into place until these deficiencies are corrected.” (Yes, you read that right. “Out of control.”)

For its part, Ranbaxy is taking the high ground, saying that it has been cooperating with the feds and arguing the FDA’s action is unwarranted. “Ranbaxy is very disappointed in the action FDA has taken today,” the company said in a statement emailed to reporters. “The company has responded to each concern FDA has raised during the past two years and had thought that progress was being made. We are, however, pleased that FDA’s testing and review led the agency to conclude that there is no reason to question the safety or effectiveness of Ranbaxy’s drugs. The company has just received the warning letters that FDA has issued and has not had the opportunity to review those concerns that FDA has determined are unresolved. Once it has had an opportunity to review the issues, the company looks forward to continuing to cooperate with FDA to resolve the remaining issues.”

Ranbaxy stock is down over 7% so far today.

Reader Comments

zboy

September 18, 2008 12:06 AM

I would never trust any drugs made in India.

jon almeida

September 18, 2008 11:23 AM

wait up americans, your country has lost its credibility now, plz open your mind (if you have one)

c.e.kestner

September 18, 2008 8:19 PM

Zboy,
When generics are all your prescription plan is willing to supply at a reasonable price, that's what you accept - when you're on twelve maintenance drugs per diem and a retiree.

Zboy

September 19, 2008 10:31 AM

Zboy,it is like saying that just because two American banks went bust the world over dont trust American instituitions. I may just decide to surrender my AIA policies and take a policy from China perhaps.

Roy Spivey

September 21, 2008 6:24 AM

I first became informed about Ranbaxy after spending three days in the hospital. My Amoxicillin has a big bold RANBAXY on the front of the bottle. Yes I am concerned!

Gaz

September 22, 2008 9:06 AM

I don't wish to join the debate, but I would like to point out that the Japanese company mentioned above is Daiichi Sankyo (not Sankyu).

Tim

September 23, 2008 12:04 PM

I'm curious to know which drugs have been banned as the majority of the generic drugs dispensed at my pharmacy are ranbaxy( along with a couple manufacturers). Their product has always been reliable in the past

Dante

October 4, 2008 11:10 AM

Sell the drugs to the Third World nations. That'll take care of their over population problem.

As to "Almeida" so what's to open up a mind to? Poisonous fake drugs? Go take some, I'm sure you have an "open mind" - as in empty in between the ears open.

Spelling

October 21, 2008 5:17 AM

Daiichi Sankyu spelt wrong, should be Daiichi Sankyo

S. Crewed

October 23, 2008 7:53 PM

The FDA is going after a company in a nation that the U.S. already entrusts vast quantities of financial, back-office operations, journalistic, historical, science and R&D data to.

Good for the FDA, but it's a drop in the tsunami that's headed our way.

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