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Sunday, May 26, 2013

Daiichi weighs options to sue Ranbaxy Labs promoters

This story first appeared in DNA Money edition on Thursday, May 23, 2013.

Daiichi Sankyo, the Japanese parent of Ranbaxy Laboratories, is weighing legal options to sue the former promoter-shareholders of the New Delhi-based generics drugmaker.

The Singh brothers -- Shivinder & Malvinder -- had sold Ranbaxy to Daiichi in 2008 for $4.6 billion. Daiichi bought a 51% stake -- including 34.8% that the Singhs held -- in June 2008.

In a statement, the company said it believes “certain former shareholders” of Ranbaxy concealed and misrepresented critical information concerning the US Department of Justice and Food and Drug Administration (FDA) investigations.

“Daiichi Sankyo is currently pursuing its available legal remedies and cannot comment further on the subject at this time,” the company said.

“Daiichi Sankyo continues to support Ranbaxy in its efforts to address and correct the conduct of the past which led to the investigations by the US Department of Justice and the FDA. These efforts include significant changes to Ranbaxy’s management, culture, operations and compliance,” it said.

Arun Sawhney, CEO and managing director, said: “Ranbaxy is a different company today.

The steps we have taken over the recent years reflect the wide-ranging efforts of the current board and management to address certain conduct of the past and ensure that Ranbaxy moves forward with integrity and professionalism in everything we do. We are fully committed to upholding the high standards that patients, prescribers and all other stakeholders expect.”

The comments follow a detailed excoriation of Ranbaxy’s past practices by the Forbes magazine in its latest issue.

“All Ranbaxy products currently in the global market are safe and effective,” Sawhney said.

The company, he said, has made investments of over $300 million (Rs 1,650 crore) in its manufacturing facilities to install state-of-the-art technologies.

“We have also instituted a rigorous new code of conduct for all Ranbaxy employees, with clear accountability for compliance,” he said.

Sawhney said Ranbaxy has successfully launched several new generic equivalents across the world recently, and maintains a robust pipeline of important new products.

“We look forward to continuing to enrich lives globally with quality and affordable medicines.”

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