Ranbaxy faces new US regulation woes

Updated 22 September 2013
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Ranbaxy faces new US regulation woes

MUMBAI: Shares in Indian generic drugs giant Ranbaxy Laboratories crashed by as much as 35 percent on Monday after the US Food and Drug Administration suspended imports from one of its factories.
The FDA issued an alert recently against the factory at Mohali in the northern state of Punjab, spelling more bad news for Ranbaxy which is struggling to live down a nearly decade-long history of US-led regulatory action.
Ranbaxy, one of the world’s biggest generic drugs makers, slid 34.99 percent to a day’s low of 297.25 rupees on the Bombay Stock Exchange in early trading.
By the end of the day, some brokerage firms had downgraded the stock, citing concerns over the future of the Mohali plant.
Shares closed down 30.27 percent at 318.85 rupees.
A spokesman for Ranbaxy, which was bought by Japan’s Daiichi Sankyo group in 2008, said “the company has so far not received any communication from the US FDA” and it was seeking information.
The FDA website did not explain the reasons for the “import alert.”
In May, Ranbaxy pleaded guilty to US charges of selling adulterated antibiotic, acne, epilepsy and other drugs and agreed to a record $500 million fine. The episode was a huge blow to its image.
The US fraud, uncovered over eight years, was exposed by a whistle-blowing ex-employee who said Ranbaxy created “a complicated trail of falsified records and dangerous manufacturing practices.”
Ranbaxy imported adulterated batches of drugs made in its Paonta Sahib facility near the Indian city of Chandigarh, which FDA inspectors said had poor record-keeping and inadequate testing for the stability of the drugs over time.
The company also admitted making false and fraudulent statements to the FDA in 2006-2007 about stability tests on several other export drugs.
The Paonta Sahib facility and another at Dewas in central India were blacklisted from producing drugs for the US market.
Ranbaxy is not alone in facing scrutiny from global regulators because of problems at its factories.
In July Britain’s health care regulator recalled 16 drugs from Indian pharmaceutical firm Wockhardt after finding deficiencies at one of its plants in western India.
“The import alert could be a huge setback for Ranbaxy Labs,” said Sarabjit Nangra, pharma analyst with Mumbai’s Angel Broking, adding that import alerts can take months to resolve.
Ranbaxy will for now have to rely on its New Jersey-based Ohm Labs to service all its US business, Nangra said.
Sriram Rathi of Anand Rathi Research, which downgraded the Ranbaxy stock from a “buy” to “sell” rating after the alert, said there could also be delays in new product launches.
The US is the world’s biggest drugs market and accounts for about 40 percent of Ranbaxy’s revenues.
India’s government has been forced to defend the country’s lucrative generic drug industry, which accounts for nearly $15 billion in annual exports.
The country has built a reputation as the “pharmacy to the world” for its production of life-saving generic versions of medicines for poor nations that cost a fraction of those with brand names.


Amazon strengthens ties with French food retailer Casino

Updated 23 April 2019
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Amazon strengthens ties with French food retailer Casino

  • The move could re-ignite speculation of a bigger deal later on
  • The extended partnership comes as Casino is selling assets and cutting debt to try to allay investor concerns

PARIS: E-commerce giant Amazon and French retailer Casino are expanding their partnership, with Amazon installing pick-up lockers in Casino stores and more of the French company’s products to be available on Amazon.
The move, which follows an initial co-operation between Casino’s upmarket Monoprix supermarket chain and Amazon in Paris, could re-ignite speculation of a bigger deal later on.
An Amazon spokeswoman said it had a policy of not commenting on market speculation. Amazon’s purchase of bricks-and-mortar US food retailer Whole Foods Market last year has raised speculation it could seek to buy a European food retailer.
The extended partnership comes as Casino is selling assets and cutting debt to try to allay investor concerns over its finances and those of parent company Rallye.
The deal, unveiled on Tuesday, will see Amazon lockers installed in 1,000 locations across France in nine of Casino’s brands, including Monoprix, Monop, Geant, Hyper Casino, Casino Supermarche, Leaderprice, Viva and Spar by the end of the year. The lockers store Amazon products to be picked up by customers.
More Casino-branded products will also be available on Amazon, while Amazon and Monoprix will extend their partnership on Amazon’s Prime Now grocery delivery service outside Paris and into new cities in the next twelve months.
“This announcement represents a new step in strengthening Casino’s omnichannel strategy to always be a little more in the heart of consumers’ lives,” said Casino’s chief executive Jean-Charles Naouri in a statement.
Monoprix, seen by analysts as similar to Whole Foods, started filling orders for subscribers to Amazon’s Prime loyalty program in parts of Paris last September.
This partnership has been closely watched as Monoprix was the first French retailer to agree in March 2018 to sell products via Amazon, causing a stir in the fiercely competitive domestic market.
France is Amazon’s third largest market in Europe, after Britain and Germany. Amazon is the e-commerce leader in France with a market share of 17.3 percent, but its grocery market share stands at just 2 percent, according to Kantar data.
The US group, which has run its Amazon Prime express delivery service in Paris since 2016, has made no secret of its desire to launch a grocery delivery service in France as part of its ambitions to expand in food retail.
But the French supermarket sector has powerful incumbents such as Carrefour and Leclerc, operating at low margins and with a dense network of stores.
Earlier this week, Casino said it would sell 12 Casino hypermarkets and 20 supermarkets to Apollo Global Management in a deal worth up to €470 million ($529 million).