Since September, Ranbaxy Laboratories has been hamstrung by a U.S. import ban. FDA is barring all the products made at two Indian facilities because of inspection red flags. More than 30 meds can't hit the U.S. market, and that's cutting deeply into Ranbaxy's sales; the drugs account for up to 15 percent of its typical revenues in this country.
Ranbaxy, of course, has been working with the FDA to resolve problems that led to the ban. But now the company is considering another approach: Buying FDA-sanctioned manufacturing plants.
Making drugs in new facilities could reverse the ban tout suite, but the change could also be expensive. Forget the cost of buying the plants themselves; simply operating in the U.S.--or practically anywhere else but India or China--would be more costly for Ranbaxy. But if the aim is, as CEO Malvinder Singh told the Financial Times, to "take products back to the U.S. market at the earliest possible time," then higher costs might be unavoidable.
- read the FT story