The share price of Ranbaxy Laboratories hit a 52 week low on Monday (June 24) apparently triggered by media reports that manufacturing practices at its plant in Mohali were also being looked at closely by the US Food and Drug Administration (USFDA).
After Friday's close at Rs 349.45, the Ranbaxy stock opened at Rs 343 on the Bombay Stock Exchange on Monday morning. It soon dropped to a 52 week low of Rs 331.40. By noon, it was trading at Rs 332.25, down by 4.92 per cent.
Clearly, memories of the US Department of Justice's announcement on May 13 this year have yet to fade. The department had announced that Ranbaxy had agreed to pay $500 million after pleading guilty to felony charges relating to the manufacturing and distribution of certain drugs made at two of its manufacturing facilities in India, Paonta Sahib and Dewas.
A Ranbaxy official refused to comment when contacted by Business Today. He refused to confirm or deny if indeed the USFDA had issued 'Form 483' relating to the Mohali plants manufacturing practices. (The form is issued when drug inspectors suspect current good manufacturing practices are being violated.) "We continue to make regulatory submissions from Mohali and as and when we get approvals we will commercialise products from Mohali," he said.
The company is currently appealing against a European Commission order - quite separate from the one by the US Justice Department - imposing a fine on it, along with eight other companies, for delaying the market entry of an antidepressant.