While CEO Malvinder Singh came out gunning yesterday against his company's critics, the big Ranbaxy probe has already spawned one follow-up investigation and may spawn more. First, Congress is launching an investigation into the FDA's handling of the allegations that Ranbaxy sold impotent or adulterated medications. The House Energy and Commerce Committee says it wants to discover whether the FDA knew the company was allegedly importing substandard meds--and whether the agency did anything about it if it did know. You'll recall that the Justice Department filed a court motion late last week demanding that the Indian generics maker turn over manufacturing audits, alleging that the company had not only sold substandard products but hid evidence of it from the FDA.
Indian regulators are keeping a close eye, considering their own investigation on behalf of Ranbaxy shareholders. They are worried that the company didn't keep its investors apprised of the risks posed by the U.S. investigation. If they determine that Ranbaxy didn't disclose enough info about the probe in its annual report, then they will launch a full-fledged probe of their own, the Business Standard reports.
Singh, meanwhile, yesterday mounted an aggressive defense, saying not only that the big deal with Daiichi Sankyo is "absolutely on track," but accusing Ranbaxy's competitors of conspiring to bring down the company's stock. A global pharma company, a leading Indian drugmaker and some stock brokers are spreading rumors, he said, hoping to undercut the Ranbaxy shares. As you know Ranbaxy's stock went on free fall as the probe news hit, falling 23 percent in two days. Singh says that the company is "collecting data from the market" on share-price manipulation, intending to hand that info over to the authorities. So make that spin-off investigation number three.
- see the Star-Ledger story
- check out the Economic Times article
- read Singh's defense, also in the ET