India Said to Seek Review of U.S. Court Ruling Papers on Ranbaxy

India’s health ministry has asked the nation’s drug regulator to review U.S. court documents that alleged Ranbaxy Laboratories Ltd. (RBXY) sold adulterated drugs, according to a ministry official familiar with the matter.

The Ministry of Health & Family Welfare has asked the Drug Controller General of India to examine documents filed in a U.S. court in which Ranbaxy admitted it sold batches of drugs that were improperly manufactured and tested and propose a course of action, the official said, asking not to be identified because the person isn’t authorized to speak to the media. India’s biggest drugmaker on May 13 agreed to pay $500 million to resolve the U.S. fraud allegations.

The official denied a report in Business Standard newspaper that said the regulator had been ordered to start a probe, including investigating previous drug approvals given to Ranbaxy in India. The company’s shares fell 1.2 percent to 431.05 rupees in Mumbai.

“All Ranbaxy products currently in the global market are safe and effective,” Chief Executive Officer Arun Sawhney said in a statement today. “We have also instituted a rigorous new code of conduct for all Ranbaxy employees, with clear accountability for compliance.”

The company has improved quality control and invested more than $300 million in its manufacturing facilities to install new technologies, according to the statement.

B. Narzary, a spokesman for the ministry, didn’t respond to an e-mail and a phone call seeking comment.

The company’s export ban in the U.S. will remain in place until it satisfies provisions it agreed to on Dec. 20, 2011, with the U.S. Food and Drug Administration and meets new inspections, Ranbaxy said in an e-mail on May 14.

Japan’s Daiichi Sankyo Co. bought a controlling stake in Ranbaxy for $4.6 billion three months before the FDA said in September 2008 that it would block more than 30 generic drugs made at two of the Indian drugmakers plants because of drug manufacturing and testing defects.

To contact the reporter on this story: Ketaki Gokhale in Mumbai at kgokhale@bloomberg.net

To contact the editor responsible for this story: Jason Gale at j.gale@bloomberg.net

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