Ranbaxy Laboratories slumped 16.29% to Rs 349.20 at 9:41 IST on BSE after the US drug regulator banned the company from manufacturing and distributing active pharmaceutical ingredients from its facility in Toansa in India to the US market.
Meanwhile, the BSE Sensex was down 67.74 points, or 0.32%, to 21,305.92.
On BSE, so far 12.88 lakh shares were traded in the counter, compared with an average volume of 4.40 lakh shares in the past one quarter.
The stock hit a high of Rs 375.45 and a low of Rs 335 so far during the day. The stock hit a 52-week high of Rs 490.15 on 6 January 2014. The stock hit a 52-week low of Rs 253.95 on 2 August 2013.
The stock had underperformed the market over the past one month till 23 January 2014, sliding 8.42% compared with the Sensex's 1.29% rise. The scrip had, however, outperformed the market in past one quarter, rising 7.86% as against Sensex's 2.92% rise.
The large-cap company has an equity capital of Rs 211.89 crore. Face value per share is Rs 5.
Ranbaxy Laboratories announced before trading hours today, 24 January 2014, that the US Food and Drug Administration (USFDA) notified the company that it is prohibited from manufacturing and distributing active pharmaceutical ingredients (APIs) from its facility in Toansa, India, for FDA-regulated drug products. The Toansa facility is now subject to certain terms of a consent decree of permanent injunction entered against Ranbaxy in January 2012.
Subsequent to the Form 483 issued in early January 2014, Ranbaxy voluntarily and proactively suspended shipments of API from this facility to the US market when it received the inspection findings, the company said in a statement.
"We are taking swift action to prevent substandard quality products from reaching US consumers," said Carol Bennett, acting director of the Office of Compliance in the FDA's Center for Drug Evaluation and Research. "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."
The FDA's inspection of the Toansa facility, which concluded on 11 January 2014, identified significant CGMP violations. These included Toansa staff retesting raw materials, intermediate drug products, and finished API after those items failed analytical testing and specifications, in order to produce acceptable findings, and subsequently not reporting or investigating these failures, USFDA added.
The agency is evaluating potential drug shortage issues that may result from this action. If the FDA determines that a medically necessary drug is in shortage or at risk of shortage, the FDA may modify this order to preserve patient access to drugs manufactured under controls that are sufficient to assure quality, safety and effectiveness.
As a result of this action, Ranbaxy is now prohibited from manufacturing API for FDA-regulated drugs at the Toansa facility and from introducing API from that facility into interstate commerce, including into the United States, until the firm's methods and controls used to manufacture drugs at the Toansa facility are established, operated and administered in compliance with CGMP, USFDA said.
Ranbaxy said it is disappointed with the recent FDA action and would like to apologize to all its stakeholders for the inconvenience caused by the suspension of shipment. "This development is clearly unacceptable and an appropriate management action will be taken upon completion of the internal investigation," said Arun Sawhney, CEO and Managing Director of Ranbaxy.
Ranbaxy is committed to highest standards of patient safety and quality, and shall constantly endeavour to strengthen its systems and processes. Ranbaxy will cooperate with the FDA and shall comply with the Consent Decree in both letter and spirit, the company said.
Ranbaxy Laboratories reported a consolidated net loss of Rs 454.17 crore in Q3 September 2013 compared with net profit of Rs 754.17 crore in Q3 September 2012. Net sales rose 3.1% to Rs 2750.17 crore in Q3 September 2013 over Q3 September 2012. The company unveils Q4 December 2013 results on 5 February 2014.
Ranbaxy Laboratories, India's largest pharmaceutical company, is an integrated, research based, international pharmaceutical company producing a wide range of quality, affordable generic medicines, trusted by healthcare professionals and patients across geographies. Ranbaxy is a member of the Daiichi Sankyo Group.
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