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Malvinder Singh on Ranbaxy's setback

July 17, 2008 09:23 IST
The Ranbaxy Laboratories stock rallied 15 per cent today after the company's Chairman & Managing Director Malvinder Mohan Singh told investors early morning that Daiichi of Japan was aware of the charges of selling sub-standard drugs made by the US Foods and Drugs Administration (FDA) against the company.

Later in the day, Singh spoke to Joe C Mathew on the issues facing the company.

Did you expect the Ranbaxy shares to bounce back today?

I never expected such a fall. Nothing has changed in our company. Our deal with Daiichi is very much on track and the shares will be bought at Rs 737 apiece.

There is no reason for our share price to be low. The shares fell due to speculation arising out of a lack of understanding. I am given to understand that the concerted efforts of a big pharmaceutical company, an Indian company and certain stock brokers were the reasons for the fall in the stock prices.

How do you intend to handle this issue?

We are putting the information together (details of the stock movements during the last two days) and it will be handed over to the authorities concerned.

Have we seen the worst of this issue?

We have responded to this situation. We have countered it. The company is going strong and everything is on track. I believe that the situation we are in now was definitely uncalled for.

Why did this happen? Could this whole issue of US FDA inquiry not have been settled earlier?

It happened due to excessive speculation and nothing else. There is no issue with the US FDA other than ongoing dialogues that take place in any business. Our business in the US is going strong and our products from different facilities across the world are being exported to the US.

You have said that Daiichi was informed about the ongoing USFDA investigations. Why were the other shareholders not informed?

There was nothing to be disclosed. All the shareholders are aware of the issue. It has been going on for three years now. We have conveyed this to Daiichi.

But to shareholders, there is absolutely no news that has arisen. There is no decision, no development. Even the recent US court issue was just a motion filed by the US government seeking some information.

Does your submission to the US court fully address the charge of selling substandard drugs?

The government's motion does not make any charges. There are certain comments in the motion which sought some information from us. We are willing to share all the information. Beyond that, there is no charge. Yes, the language used in the motion is hard and we have denied all such allegations.

Does production in your Poanta Sahib facility remain affected? Is there any drug that was withdrawn?

All medicines that have USFDA approvals continue to be produced in the Poanta Sahib facility. The USFDA has not given any approval for new drugs as they have some concerns. We are addressing them.

Are you happy with the 15 per cent bounce-back of your share prices?

The prices should be higher.

Ranbaxy to file response within a month

Source: source