Generic drugs manufacturer Ranbaxy USA has confessed to engaging in criminal behavior and agreed to pay a $500 million fine (covering both criminal and civil fines and forfeiture).

The fine is the largest imposed by the U.S. on a generic drugs manufacturer.

Ranbaxy – Japanese Firm Now

Ranbaxy USA is a subsidiary of Ranbaxy Laboratories Limited.

Contrary to popular belief, Ranbaxy is not an Indian company any longer since Daiichi Sankyo Company, Ltd. of Japan acquired majority control (63.92%) of Ranbaxy Laboratories Limited for $4.6 billion in 2008.

But Ranbaxy was under Indian management for most of the time during which it engaged in illegal behavior.

Criminal Behavior

Ranbaxy’s criminal actions took place at its manufacturing plants in Paonta Sahib and Dewas (both in India) between 2003 and 2008.

Ranbaxy has confessed to many sins to the U.S. authorities –  Manufacturing and selling adulterated drugs, lying to the Food and Drug Administration, not keeping complete testing records, failing to file timely reports known to FDA as “field alerts” for batches of Sotret and gabapentin that had failed certain tests, storing drug samples for unknown periods of time in a refrigerator that did not meet specified temperature and humidity ranges for an approved stability chamber and not disclosing it to the FDA, and submitting false claim to U.S. healthcare programs like Medicare, Medicaid, Department of Veterans Affairs etc.

Ranbaxy USA pleaded guilty to three felony counts pertaining to manufacture and distribution of adulterated drugs under the Food, Drug and Cosmetic Act and four felony counts of knowingly making material false statements to the Food and Drug Administration.

Ranbaxy attempted to cover up its crimes but was foiled by a whistleblower Dinesh Thakur, who complained to the U.S. authorities.

For his whistleblowing efforts that exposed Ranbaxy’s illegal actions, Dinesh Thakur received $48.6 million from the fines paid by the drug company.

Acting Assistant Attorney General for the Civil Division of the Department of Justice Stuart F. Delery said:

When companies sell adulterated drugs, they undermine the integrity of the FDA’s approval process and may cause patients to take drugs that are substandard, ineffective, or unsafe. We will continue to work with our law enforcement partners to ensure that all manufacturers of drugs approved by the FDA for sale in the United States, both domestic and foreign, follow the FDA guidelines that protect all of us.

  Ranbaxy