Ranbaxy to pay $500 million to settle USFDA ban

Generic drugs major Ranbaxy Laboratories Ltd has agreed to pay $500 million to the US Food and Drugs Administration (US FDA) to settle civil and criminal proceedings against the company in the US.

Ranbaxy also announced the signing of a consent decree with the US Food and Drug Administration committing itself to further strengthening of procedures and policies to ensure good manufacturing practices, in return for allowing the company to resume normal operations in the US market.  

The consent decree is subject to approval by the US district court in Maryland, Ranbaxy said, adding that the $500 million provisioning in connection with the investigation by the US Department of Justice will be sufficient to resolve any potential civil and criminal liability.

In 2008, the USFDA had imposed a ban on 30 drugs being manufactured by the company at its plant in Paonta Sahib and Dewas.

''We are pleased to have resolved this legacy issue with the FDA as we begin the next chapter in Ranbaxy's history,'' said Arun Sawhney, CEO and managing director of Ranbaxy.

''While we were disappointed by the conduct that led to the FDA's investigation, we are proud of the systematic corrective steps we have taken to upgrade and enhance the quality of our business and manufacturing processes.  Ranbaxy's new management team, and its new majority shareholder, Daiichi Sankyo, are committed to the utmost levels of professionalism and integrity, and to ensuring that all Ranbaxy facilities meet the high standards that patients, prescribers and the public expect from a leading global generic pharmaceutical company.  We look forward to continuing to work cooperatively with the FDA to strengthen the public trust in our company.''