In an effort to get itself into a place where it can again ship from its FDA-approved plants in India, Ranbaxy Laboratories says it is taking a hard look at how it runs its API operations.
Given that Indian drugmaker Ranbaxy Laboratories is under FDA sanctions for its manufacturing misses, a quarterly loss of $25.5 million may not sound so bad. But the January ban of a key API plant stands to make the current quarter worse, and competitors are looking for every opportunity to take even more business away.
Japan's Daiichi Sankyo believed it was making a solid move when it bought controlling interest in Ranbaxy Laboratories for $4.6 billion in 2008. Instead it has seen its finances burdened by Ranbaxy's non-stop regulatory issues, leading some to wonder if Daiichi might get fed up and bail out. But executives today said they don't intend to do that, at least not for now. Instead Daiichi will take "drastic" steps to turn the operations around.
Ranbaxy Laboratories had a compliance program and plenty of warning signs that there were problems at its plants before the FDA and Department of Justice got involved in an investigation that led to serious actions and a $500 million fine. It just didn't have the culture or the buy-in at all levels to fix them.
What is a generic drugmaker going to do when the FDA finds flies filling its analytics laboratory and shuts down a yet another plant key to serving the U.S. market? Start looking for other markets. That is what analysts say India's generics leader Ranbaxy Laboratories is faced with now that it has only one FDA-approved facility to work with and its critical API plant is banned from supplying it.
Novartis' blockbuster Diovan has enjoyed nearly 18 months of sales unscathed by generics since its patent expired in September 2012, as regulatory entanglements have kept Ranbaxy Laboratories from producing its copycat version. Now the Indian drugmaker has a plan to finally get it to market and claim its 6 months of exclusivity.
Among all of the fallout from the well-publicized manufacturing mess at Ranbaxy Laboratories has been its inability to get a generic of Novartis' blockbuster hypertension fighter Diovan to market. Reports have now surfaced that indicate the Indian drugmaker wants to make the drug in the U.S., using an API supplied by another company.
The boom years of the Indian pharmaceutical industry saw overseas businesses snap up Ranbaxy, Piramal Healthcare and a host of other firms, but consternation about the trend led some to try to curb such deals. Now though, with the Indian economy slowing, the government has thrown out the proposals.
Ranbaxy Laboratories got into the vaccine manufacturing business a few years ago, but now it may be looking to get out as its regulatory problems pile up. According reports, Ranbaxy is likely to sell Biovel, the vaccine company it bought in 2010.
When Ranbaxy bought vaccine supplier Biovel in 2010, the then-CEO of the beleaguered Indian generic firm called it an important part of the company's growth strategy. The CEO is long gone, having resigned within months of buying Biovel, and now Ranbaxy is reportedly ready to split up with its vaccine unit too.