New Delhi: It’s been a year of bitter medicine for Indian pharma companies with fines worth millions of dollars imposed by various foreign regulators, even as they stitched together deals worth billions of dollars, including the high profile Sun-Ranbaxy merger.
On the other hand, the government sought to put controls on drugmakers when it came to pricing of essential drugs, including those for common cough and cold as also for cancer and other diseases.
Incidentally, home-grown Ranbaxy, founded by the family of Malvinder and Shivinder Mohan Singh, was at the centre of most of the developments for major part of the year, including for M&A deals and regulatory clampdown by foreign regulators, including in the US and Europe.
In a surprise announcement in April, Sun and Ranbaxy — at that time owned by Japan’s Daiichi — declared an all-stock deal to create India’s largest and world’s fifth-largest drugmaker in an over USD 4 billion deal.
The deal soon came under the scanner of fair trade watchdog Competition Commission of India (CCI), which ordered the first ever public scrutiny of an M&A deal for this merger, before clearing it towards the end of the year after ordering the divestment of seven brands between two firms.
The deal marked another transition in the ownership for Ranbaxy, in which Japan’s Daiichi Sankyo had acquired a majority stake in 2008 for Rs 22,000 crore after the erstwhile promoters Malvinder and Shivinder Singh exited the firm.
Otherwise too, both Sun and Ranbaxy had to face their own issues with the US health regulator FDA for alleged violation of good manufacturing practice norms.
A number of other Indian drugmakers, including IPCA Labs, Wockhardt and Dr Reddy’s Laboratories were also pulled up by the FDA for one or the other reasons.
The FDA imposed a ban on import of medicines produced at Ranbaxy’s India-based factories into the US, the world’s biggest drug market.
Ranbaxy also agreed to pay USD 39.75 million (around Rs 244 crore) in tranches to the state of Texas in the US to settle the litigation concerning its participation in the Texas Medicaid Program.
Its woes extended to Europe when it was barred from exporting certain antibiotics from its Dewas plant to Germany for non-compliance to ‘good manufacturing practise’ norms.
Later, certain drugs produced at its Dewas plant were barred from export to the entire European Union for non-compliance to ‘good manufacturing practise’ norms.
Further, a US court did not grant the company temporary restraining order to block the US health regulator from approving other ANDAs for generic versions of digestive disorder medicine Nexium and anti-viral Valcyte.
PTI
