The Telegraph
Wednesday , February 26 , 2014
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Ranbaxy prefers caution

Mumbai, Feb. 25: Ranbaxy Laboratories today said it was temporarily suspending shipments of pharmaceutical ingredients made at its two units in the country.

The temporary suspension is, however, a voluntary action on the part of the company as it undertakes a detailed review of the systems and processes followed at the two plants at Toansa in Punjab and Dewas in Madhya Pradesh.

The Ranbaxy move comes soon after the US Food and Drug Administration (USFDA) barred the export of active pharmaceutical ingredients (APIs) manufactured at the Toansa facility to the US. Pharmaceutical analysts said the latest action by Ranbaxy meant that it would not supply APIs from these two facilities to other markets that include Europe and India.

“Ranbaxy has now voluntarily suspended all API shipments from both the Toansa and Dewas plants in order to allow for further evaluation and inspection of manufacturing processes and quality control systems. The temporarily suspended shipments will be resumed once the processes and controls at these facilities are reconfirmed based on internal evaluations and inspections,” Daiichi Sankyo Company Ltd said in a statement.

Ranbaxy went on to add that while the voluntary decision was taken as a “precautionary measure and out of abundant caution” to assess and review the processes and controls, shipments would resume after it was reassured about the processes and controls at these facilities.

The company further disclosed that a committee of the board called the quality and integrity committee had been constituted this month. Its primary role is to provide oversight on the company’s manufacturing and quality operations, systems, organisation and integrity apart from the objective to assure good governance to all stakeholders.

Ranbaxy has been in the news over export restrictions imposed by the US drug regulator on four of its plants in India because of concerns over manufacturing practices. Apart from Toansa, the other three include its Paonta Sahib, Dewas and Mohali facilities.

At a recent conference call after the declaration of its quarterly results, Arun Sawhney, chief executive officer and managing director of Ranbaxy, said the company was taking various steps to deal with the concerns expressed by the US drug regulator.

“I would like to assure all our stakeholders that we will do whatever is necessary to address all concerns of the USFDA and are committed to resolving them as early as possible,” he said.

He added that Ranbaxy would also work with the USFDA to resolve its concerns regarding the Toansa unit and that strict action would be taken up on completion of internal investigation.

Ranbaxy’s announcement pertaining to suspension of APIs made at the two units initially led to selling pressure on the stock. However, the stock recovered to close with a gain of around 1 per cent at Rs 367.05 on the Bombay Stock Exchange as investors gave a thumbs-up to the pro-active effort, which they felt would be positive for the company in the long run.