Ranbaxy falls further into regulatory quagmire with latest FDA ban

Every time Ranbaxy Laboratories seems to be making some progress, it stumbles over manufacturing problems that should have been resolved years ago. The FDA Thursday said it was banning a fourth of Ranbaxy Indian plant from exporting to the U.S. This one makes a majority of the active pharmaceutical ingredients for its U.S. drugs.

"The FDA is committed to ensuring that the drugs American consumers receive--no matter where they are produced--meet quality standards and are safe and effective," Carol Bennett, acting director of the Office of Compliance in the FDA's CDER, said in a statement. She said the agency is exploring whether this ban will result in any drug shortages in the U.S.

Ranbaxy reported earlier this month that an FDA inspection found issues at its API plant in Toansa. The FDA said it was extending provisions of a strict consent decree that Ranbaxy Laboratories signed in 2011 to this plant. The decree initially applied to two Ranbaxy plants in India but now applies to four.

The company said in a statement that it had "proactively suspended shipments" from the plant when it received the FDA Form 483 criticizing the facility. "This development is clearly unacceptable and an appropriate management action will be taken upon completion of the internal investigation," Ranbaxy CEO and Managing Director Arun Sawhney said in a statement. Ranbaxy parent, Japanese drugmaker Daiichi Sankyo issued its own statement saying it would have to evaluate what the newest ban will mean for its earnings, Bloomberg reported.

Ranbaxy has its three FDA-approved drug manufacturing facilities in India banned now, and this plant makes an estimated 70% of its APIs used in the U.S., the largest market for the generic drugmaker. It now has only its Ohm Laboratories plant in New Jersey still able to produce drugs for the U.S. The bans have complicated drug launches for Ranbaxy in the U.S, like for its exclusive generic of Novartis' ($NVS) high blood pressure blockbuster Diovan, which went off patent in September 2012. Media reports from earlier this month said that Ranbaxy had asked the FDA to allow it to manufacture that drug at its Ohm plant but was going to have to buy the API for from an outside source, putting pressure on the profits it could expect to make from the exclusive launch. Some months after it launched generic Lipitor in 2012, it ran into manufacturing problems that required it recalling 41 lots of the drug and stopping production.

Ranbaxy has been under strict FDA oversight for years now, and when Ranbaxy reported the latest FDA concerns two weeks ago, one analyst remarked that it was unbelievable that after that long the company continued to run into these kinds of issues with regulators. "If this plant also comes into FDA issues, it means that the company has not spruced up its quality controls even four years after continued FDA supervision," Arvind Bothra, an analyst at investment firm Religare in New Delhi, said. "That raises concerns whether overall the company would be able to come out of this FDA scrutiny."

- here's the FDA statement
- here's the Ranbaxy statement
- read the Bloomberg story

Special Report: Top 10 generics makers by 2012 revenue - Daiichi Sankyo

Related Articles:
Ranbaxy manufacturing drama continues with FDA action on API plant
FDA extends Ranbaxy consent decree to Mohali plant
Ranbaxy inks record-setting $500M manufacturing settlement with the feds
Ranbaxy production glitch devastates its generic Lipitor biz

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