Ranbaxy recalls generic Lipitor in US, stock tumbles
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RANBAXY Labs Ltd, the country's top drugmaker by sales, said it is recalling its cholesterol-lowering drug Atorvastatin calcium in the United States, a generic version of Lipitor, as some batches may contain very small glass particles. The drug largely drove the company's sales in the first half of the year.
The latest recall for Ranbaxy, already on alert under a US Food and Drug Administration scrutiny for past slippages, is being conducted at the retail level. This will temporarily disrupt supplies of Atorvastatin in the US while it conducts an investigation, the company said in a statement. Shares of Ranbaxy, controlled by Japan's Daiichi Sankyo, closed down 3.27 per cent at Rs 496 following the announcement.
"Ranbaxy...is conducting a voluntary recall for Atorvastatin calcium tablets, in connection with its 10 mg 20 mg and 40 mg dosage strengths...only with respect to certain select lot numbers...The recall is being conducted at the retail level for such select batches that may contain a foreign substance (small glass particles approximately less than 1 mm in size)," the statement said.
The direct impact of the recall, without factoring in two weeks of disruption in supplies, is being pegged by analysts at close to $5 million. This disruption may also dent the company's Lipitor market share of over 45 per cent in the US.
In September 2008, the FDA banned over 30 medicines manufactured by Ranbaxy at Paonta Sahib in Himachal Pradesh and Dewas in Madhya Pradesh. Four months later, it invoked the company's "application integrity policy", which meant it also decided not to grant any new drug approvals from Paonta Sahib. The firm has since pursued discussions with US agencies, which culminated in a legal agreement that contains a series of corrective steps the company must implement to avoid litigation by the FDA and remain in business in the US.