Ranbaxy reports Rs190-cr quarterly loss after settlement with US FDA
30 July 2014
Ranbaxy Laboratories Ltd has reported a net loss of Rs190 crore ($32 million) for the April-June quarter of the current financial year in the wake of an import ban imposed by the US authorities in January this year.
Ranbaxy Laboratories, India's largest generic drug maker, attribute the loss to the fall in sales after a January ban on US imports from its Punjab factory and a one-time provision for government settlement discussions.
The company said it was taking a one-time provision of Rs240 crore for ''on-going'' settlement talks with the US government. It didn't provide details on what the provision was for or the subject of the government talks.
Last year, Ranbaxy agreed to pay $500 million to settle a whistleblower lawsuit and federal criminal charges that the company sold adulterated drugs while lying about it to the US Food and Drug Administration (See: Ranbaxy fined $500 mn by US regulator over drug safety lapses).
The Indian drugmaker reported a loss of Rs190 crore ($32 million) for the three months ended 30 June 2014, compared with a loss of Rs524 crore in the year before, according to a stock exchange filing.
Consolidated sales for the quarter ended 30 June 2014 stood lower at Rs2,370 crore against January-March 2014 sales of Rs2,580 crore.
Earnings before interest, tax, depreciation and amortisation (EBITDA) was Rs240 crore.
A joint inspection by multiple European agencies, including from the UK, Ireland, Germany, Switzerland and TGA Australia, completed inspection at the Toansa API facility during March 2014 with no critical observations. The inspection team concluded that there was no evidence that the products manufactured at the Toansa API facility have any product quality or patient safety issues, and the EU authorities reinstated the EU GMP certificate for the Toansa facility on 5 June, Ranbaxy said in a website release.
Commenting on the business results for the quarter, Arun Sawhney, CEO & managing director, Ranbaxy, said, ''We continue to work towards growing our base business with focus on emerging markets, while at the same time, restoring the business on growth trajectory in our traditional markets such as USA and Europe.''
Ranbaxy, which is in the process of being acquired by Sun Pharmaceutical Industries Ltd, said it has received communication from the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) conveying their `No Objection' based on the observations of the Securities and Exchange Board of India (SEBI) in regard to the scheme of arrangement for merger of the company with Sun Pharmaceutical Industries Ltd.
Ranbaxy's parent, Tokyo-based Daiichi Sankyo, on 7 April agreed to sell its controlling stake in Ranbaxy to Sun Pharmaceutical Industries after the company suffered heavy losses on the Indian drugmaker (Sun Pharma, Ranbaxy to merge in Rs24,000 all-stock deal).