Feb. 27 (Bloomberg) -- Daiichi Sankyo Co., Japan’s third- largest drugmaker, fell to a record low in Tokyo, extending a slump after U.S. regulators said they’ll stop evaluating new medicines made at one plant operated by its Indian unit.

Daiichi Sankyo sank 5.3 percent to 1,591 yen on the Tokyo Stock Exchange, the lowest close since the company was formed from a merger in September 2005. It was the third-steepest decline among members of the benchmark Nikkei 225 Stock Average.

The decision by the U.S. Food and Drug Administration to end reviews of drugs produced at Ranbaxy Laboratories Ltd.’s plant in Paonta Sahib, India, comes after Tokyo-based Daiichi Sankyo forecast the biggest annual net loss by a Japanese drugmaker because of writedowns from its purchase of the Indian company.

The agency suspended the evaluations after findings at the facility raised “significant questions about the reliability” of data used to support requests to sell drugs in the U.S., the regulator said on Feb. 25.

Ranbaxy declined 18 percent to 169.85 rupees yesterday in Mumbai, the steepest drop among companies trading on the benchmark Bombay Stock Exchange Sensitive Index.

Daiichi Sankyo, created through Sankyo Co.’s purchase of Daiichi Pharmaceutical Co., acquired 64 percent of Ranbaxy last year.

To contact the reporter on this story: Nicolas Johnson in Tokyo at nicojohnson@bloomberg.net.

Last Updated: February 27, 2009 01:42 EST