Top Indian Drug Maker's Shares Plunge On FDA Alert
MUMBAI, India (AP) -- Shares in India's largest pharmaceutical company plummeted Monday after U.S. regulators issued an import warning on one of its factory's products for failing quality control inspections.
Ranbaxy Laboratories Ltd. stock price fell by 30.3 percent to 318.40 rupees ($5.10) by the close of trading on the Bombay Stock Exchange.
The sharp losses came after the U.S. Food and Drug Administration effectively stopped imports of 11 drugs from Ranbaxy's Mohali factory in Punjab province on Friday because it was deemed not to meet good manufacturing practices. Two other Ranbaxy factories are already under similar alerts from 2009.
The FDA did not specify what was wrong with the Mohali factory or its products. Ranbaxy had no immediate reaction on Monday.
With revenues of $2.3 billion for the last fiscal year, Ranbaxy is the leading drug maker in India's $26 billion generic pharmaceutical industry, but it has been plagued with problems in the U.S.
In May, the company's American subsidiary agreed to pay $500 million in fines and penalties for selling adulterated drugs and lying to federal regulators, the largest financial penalty against a generic drug company for violations of the Federal Food, Drug and Cosmetic Act, which prohibits the sale of impure drugs.
In late 2012, another subsidiary, Ranbaxy Pharmaceuticals Inc., was forced to halt production of a generic version of the cholesterol drug Lipitor to investigate how tiny glass particles got into the ingredients used for dozens of batches that had to be recalled. It was Ranbaxy's second recall of the drug in three months.
Two years ago, the FDA struck a deal that required Ranbaxy Laboratories Ltd. to undergo extra oversight and review from a third-party and improve its drug making procedures.