Shares of Ranbaxy Laboratories Ltd (RBL) came under the hammer shedding close to 17 per cent on the NSE after the company said that it has been barred by the USFDA from manufacturing and distributing Active Pharmaceutical Ingredients (APIs) from its Toansa facility in the country.
Stung by the FDA action, Ranbaxy CEO and MD Arun Sawhney said the development was “clearly unacceptable’’ and an appropriate management action would be taken once the internal investigation was over.
Trading volume was huge in both the exchanges with the NSE witnessing a volume of over 6 million shares within the first 35 minutes of trading.
In a statement to the stock exchanges, Ranbaxy said that the US Food and Drug Administration (USFDA) has notified the company that it was “prohibited from manufacturing and distributing’’ APIs from its facility at Toansa for FDA regulated products. This facility is now subject to certain terms of a consent decree of permanent injunction entered against it in January 2012.
The company said that after receiving Form 483 in early January 2014, it had “voluntarily and proactively suspended shipments’’ of APIs from this unit to the US market when it received the inspection findings.
Expressing disappointment with the US FDA action, the company apologised to its stakeholders for the inconvenience caused.
The company reiterated its commitment to the highest standards of patient safety and quality and would constantly try to strengthen its systems and processes.
Share price
As the facility caters to a key market and as it had to go through the processes of getting approvals that would be a lengthy one, the Ranbaxy stock came under intense selling pressure this morning.
On the NSE, the stock was down by 16.58 per cent or Rs 69.20 to Rs 348.25. On the BSE, the stock shed Rs 69.45 or 16.70 per cent to Rs 347.70 with about 13.69 lakh shares being traded which was double the size of two-week average traded quantity of 6.21 lakh shares.