SHARES of India's Ranbaxy Laboratories slumped over five per cent on Wednesday (November 19) after it announced it had sued the US Food and Drug Administration for revoking approvals for its generic versions of two top-selling drugs.
The drugmaker said late Tuesday (November 18) it filed a legal case against the US regulator for rescinding its consent for Ranbaxy to sell copycat versions of patented heartburn medicine Nexium, made by AstraZeneca, and Roche's anti-viral drug Valcyte.
“Ranbaxy filed a complaint against the US FDA,” the New Delhi-based company said in a statement.
Ranbaxy and the FDA have long been at loggerheads over quality issues at the company's Indian factories.
Shares of Ranbaxy fell as much as 5.11 per cent on the Bombay Stock Exchange on Wednesday before retracing some losses to close down 4.15 per cent at Rs602.65 ($9.71/£6.19).
The FDA had granted Ranbaxy six-month exclusivity licences to sell the drugs, awarded to companies that make the first copycat version.
Earlier this month, the FDA said it was “correcting a mistake and rescinding the tentative approval letters”.
Shares of the company have been under pressure since the FDA's decision November 4 to withdraw approval to Ranbaxy.
The FDA said when it gave the consent six years ago it had not realised the Indian plants where Ranbaxy planned to make the drugs did not meet US quality standards.
Ranbaxy said its suit filed in US federal court sought an “immediate judicial review” of the FDA decision which it charged had stripped the company of its “statutory rights”.
It said the FDA move had deprived the company of “literally hundreds of millions of dollars in anticipated revenues for certain generic versions of the brand-name drugs Nexium and Valcyte”.
Ranbaxy said it had asked the court “for a temporary restraining order to prevent any further action by the FDA until Ranbaxy's case is decided” and called the regulator's decision “capricious and contrary to law”.
The drug-maker, which is in the process of being bought by Indian rival Sun Pharmaceuticals in a $3.2bn (£2.04bn) all-stock takeover, has been under FDA scrutiny for years over its manufacturing quality.
Last year, a US court fined Ranbaxy, then owned by Japan's Daiichi-Sankyo, a record $500m (£318.80m) for distributing adulterated drugs in the United States and faking clinical results.
Ranbaxy is currently banned from supplying drugs to the United States from any of its Indian plants due to quality problems that the Mumbai-based company says it is seeking to rectify.
However, the company could have potentially supplied the generics from its US manufacturing facilities, analysts say.
India exports $15bn (£9.56bn) in over-the-counter and generic prescription drugs annually and is the second-largest supplier of drugs to the United States after Canada, earning it the title of “pharmacy to the world”.
