Trouble seems to be mounting for pharma major Ranbaxy. On Tuesday, not only did the US Food and Drugs Administration (FDA) bring the third Mohali plant under the ambit of a consent decree, resulting in much tighter rules for Ranbaxy to adhere to, even the Indian drug regulator said it is looking into the plants catering to domestic markets.

The Indian authority had started looking into the safety of Ranbaxy’s medicines after the company pleaded guilty to violations in the US, and had to pay a $500 million fine for the same.

The Drug-Controller General of India, G.N. Singh, told Business Line that the regulator is looking into the plants that manufacture drugs for the Indian market. “The investigation is in process and if there are some alarming findings we’ll take strict actions,” he said.

However, as far as the Mohali plant is concerned the regulator will not inspect it since it “is totally export oriented.”

Meanwhile, Ranbaxy confirmed that the US FDA had informed the company about the import alert on its Mohali plant late on Monday night.

Ranbaxy’s Paonta Sahib and Dewas plants have also been under such alerts since 2008.

“Ranbaxy will review the details and will continue to fully cooperate with the US FDA and take all necessary steps to resolve the concerns at the earliest,” the spokesperson said.

According to a statement by the FDA it has “also ordered that the Mohali facility be subject to certain terms of the consent decree of permanent injunction entered against Ranbaxy in January 2012.”

It further said that in September and December 2012, FDA inspections had identified significant Current Good Manufacturing Practices violations at the Mohali facility.

This decree has provisions to ensure compliance towards CGMP at Ranbaxy facilities, including in Paonta Sahib and Dewas, also has provisions to address data integrity issues at these facilities.

“Under the decree, Ranbaxy is prohibited from manufacturing FDA-regulated drugs at the Mohali facility and introducing drugs into interstate commerce, including into the United States, from the Mohali facility until the firm’s methods, facilities, and controls used to manufacture drugs at the Mohali facility are established, operated, and administered in compliance with CGMP,” the FDA statement said.

Since the Mohali plant was relatively new and had not started full-scale operations, this move is unlikely to have an immediate financial implication.

Pending approvals

However, reportedly 34 filings are pending approvals from Ranbaxy’s two plants servicing the US market — Mohali and Ohm labs. And product approvals filed from the Mohali plant could now face long delays of six months and more, and, consequently, impact the company’s future earnings. One analyst estimated that this could have an impact of as much as Rs 1,000 crore.

Angel Broking said that according to the company, the filings from Ohm and Mohali total around $6 billion of brand value at present and these new facilities were expected to contribute more than 75 per cent of the business.

“While it’s a relief, to some extent, that the Mohali unit is covered under the consent decree… it doesn’t take away the fact that it could imply an additional penalty for the company and also impact on the profit and loss,” Sarabjit Kour Nangra, VP-Research (Pharma), Angel Broking, said, adding that it could hit the company’s US business growth.

Meanwhile, Ranbaxy’s stocks bounced back a little on Tuesday and ended the day at Rs 330 apiece, which is a 3.5 per cent rise (Rs 11.15) since Monday’s low.

> aesha.datta@thehindu.co.in

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