US FDA BLOCKS IMPORT OF 30 DRUGS MADE BY INDIAN PHARMA RANBAXY

DELHI, Oct 03, 2008 (AsiaPulse via COMTEX) -- RBXLF | Quote | Chart | News | PowerRating -- In a major setback to Indian pharmaceutical giant Ranbaxy (BSE:500359), the US government has blocked the imports of 30 generic drugs, including anti-biotics and cholesterol medicines, produced by it in two of its plants located in India due to serious manufacturing deficiencies.

The Food and Drug Administration (FDA) has issued two warning letters to Ranbaxy Laboratories Limited and an import alert for generic drugs produced by Ranbaxys manufacturing facilities in Dewas (Madhya Pradesh) and Paonta Sahib (including the Batamandi unit in Uttar Pradesh), According to the statement posted on the website of US health regulator FDA. The FDA import alert covers more than 30 different generic drug products (Drug List) produced in multiple dosage forms and dosage amounts (25 mg, 50 mg and 100 mg) at the companys two plants. The warning letters identify the agencys concerns about deviations from US current good manufacturing practices requirements (cGMP) at the pharmaceutical majors two manufacturing facilities, it said.

Because of the extent and nature of the violations, FDA issued an import alert, under which U.S. officials may detain at the U.S. border, any active pharmaceutical ingredients (the primary therapeutic component of a finished drug product) and both sterile and non-sterile finished drug products manufactured at these Ranbaxy facilities and offered for import into the United States, the statement said.

However, this action does not impact products from Ranbaxys other plants as FDA has inspected those facilities and till date they have met US cGMP requirements for drug manufacturing, it said. Ranbaxy exports about 59 drugs from these facilities to the US. These drugs include Simvastatin, Acyclovir, Minocycline, Clindamycin, Lorazepam, Loratadine-D, Cetirizine, Acetaminophen Extended tablets, Lisinopril and Zolpidem. Reacting to the FDA decision, Ranbaxy said it is very disappointed in the action FDA has taken. 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 FDAs testing and review led the agency to conclude that there is no reason to question the safety or effectiveness of Ranbaxys drugs, the company said in a statement from Gurgaon.

Specific areas of concern by FDA included inadequate measures to prevent cross-contamination of pharmaceuticals, inadequate batch production and control records and inadequate aseptic (sterile) processing operations in the Ranbaxy plants. The FDA however has not completely banned the products already supplied in the market and has recommended that consumers continue taking their medications manufactured by Ranbaxy and not disrupt their drug therapy, which could jeopardize their health. FDA is also evaluating whether the action would create any potential drug shortages in the United States and has determined that other suppliers can meet market demand with one exception. Because Ranbaxy is the sole supplier to the U.S. of one drug product, Ganciclovir oral capsules (an antiviral drug), to avoid creating a shortage of the drug, FDA generally will not detain shipments of this product, and plans to arrange for additional oversight and controls until the company resolves these manufacturing issues, the statement said. The development has proved to be catastrophic for the companys stock as the price goes down by10 per cent in a single day. As the news of FDA banning the drugs of Ranbaxy spread accoss, the share of the company suffered massive setback on the bourses and settled with a loss of nearly seven per cent in single day. During the first day itself, shares of Ranbaxy Laboratories plunged even further by over 10 per cent on the Bombay Stock Exchange as well as on the National Stock Exchange.

The fall in Ranbaxy shares was largely due to the import ban by the US health regulator, as it would possibly result in declining sales of the company in the North American market, which would then dent its balance sheets, domestic brokerage firm SMC Global Vice President Rajesh Jain said.

Besides, the bearish sentiment in the stock market also added to the fall, Jain added.

On the Bombay Stock Exchange, the shares of the company dipped 10.54 per cent and hit an intra-day low of Rs 363.10 (US$7.85), while on the National Stock Exchange, it registered a decline of 10.19 per cent and witnessed an intra-day low of Rs 362.10. The scrip, however, regained some lost ground and ended the day at Rs 379.10, down 6.60 per cent on the BSE and at Rs 375.50, down 6.87 per cent on the NSE.

(PTI)

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