FDA Files Consent Decree Against Ranbaxy

The US Department of Justice, on behalf of FDA, filed a consent decree of permanent injunction against the generic-drug manufacturer Ranbaxy in the US District Court of Maryland. The consent decree was filed against Ranbaxy Laboratories Ltd., an Indian corporation, and its subsidiary Ranbaxy Inc., headquartered in Princeton, New Jersey. The decree was filed on Jan. 25, 2012, and is subject to court approval.

In addition to the companies, Dale Adkisson, senior vice-president and head of global quality, and Arun Sawhney, CEO and managing director, both of Ranbaxy Laboratories, and Venkatachalam Krishnan, regional director Americas of Ranbaxy Inc., were named as defendants. The consent decree addresses outstanding cGMP and data-integrity issues at Ranbaxy’s Paonta Sahib, Batamandi, and Dewas, India, facilities as well as cGMP issues at Ranbaxy Inc.'s wholly owned subsidiary Ohm Laboratories facility located in Gloversville, New York.

Ranbaxy’s Paonta Sahib, Batamandi, and Dewas, India, facilities have been on FDA import alert since 2008, and Ranbaxy has closed its Gloversville facility, according to a Jan. 25, 2012, FDA press release. The consent decree requires that Ranbaxy comply with detailed data-integrity provisions before FDA will resume reviewing drug applications containing data or other information from the Paonta Sahib, Batamandi, and Dewas facilities. Specifically, Ranbaxy must:

• Hire a third-party expert to conduct a thorough internal review at the facilities and audit applications containing data from the affected facilities

• Implement procedures and controls sufficient to ensure data integrity in the company’s drug applications and

• Withdraw any applications found to contain untrue statements of material fact and/or a pattern or practice of data irregularities that could affect approval of the application.

In addition, the consent decree prevents Ranbaxy from manufacturing drugs for introduction to the US market and for the President’s Emergency Plan for AIDS Relief Program at the Paonta Sahib, Batamandi, Dewas, and Gloversville facilities until drugs can be manufactured at such facilities in compliance with US manufacturing quality standards.

“Because this company continued to violate current good manufacturing practice regulations and falsify information on drug applications, the FDA took these actions in an effort to protect consumers,” said Dara Corrigan, FDA associate commissioner for regulatory affairs, in the FDA press release. “The FDA continues to be committed to protecting consumers from potentially unsafe products that may be offered on the market.”

Under this agreement, once Ranbaxy has achieved compliance with the data- integrity requirements, a third-party expert must conduct audits of the facilities to confirm that compliance is being maintained. The company must authorize an individual to be responsible for all quality-assurance and quality-control activities to ensure that drugs have the required safety, identity, strength, quality, purity, and potency and are in compliance with the law and the decree. In addition, the company must establish an Office of Data Reliability to conduct presubmission audits of all applications submitted from any facility after entry of the decree.

Ranbaxy has agreed to relinquish any 180-day marketing exclusivity that it might have for three pending generic-drug applications. The firm has further agreed to relinquish any 180-day marketing exclusivity that it may have for several additional generic drug applications if it fails to meet certain decree requirements by specified dates.

The consent decree contains liquidated damages provisions to cover many potential violations of the law and the decree. In addition to a provision requiring Ranbaxy to pay $15,000 in liquidated damages for each day defendants violate the law or the decree at the facilities covered by the decree and an additional sum of $15,000 for each overall violation of the law and the decree, the decree specifies two other requirements. If defendants distribute any drug from the facilities covered by the decree, Ranbaxy shall pay liquidated damages equal to two times the retail value of such drug, not to exceed $10 million in any one calendar year. Also, if the defendants submit an untrue statement in connection with any application they file with FDA, Ranbaxy shall pay up to $3 million dollars in liquidated damages for each such statement, not to exceed $30 million in any one calendar year.

The decree also permits FDA to order additional Ranbaxy facilities to be covered by the decree if the agency discovers through an inspection that the facility is not operating in compliance with the law and/or has serious data-integrity issues.

Ranbaxy issued the following statement in response to the filing of the consent decree. “Today’s announcement is the next step in the process of finalizing our agreement with the FDA to resolve this legacy issue,” said Arun Sawhney, Ranbaxy CEO and managing director, in a Jan. 26, 2012, press statement. “We are pleased with the progress we have made in upgrading and enhancing the quality of our business and manufacturing processes and remain committed to ensuring that all of our facilities and products meet the high standards that patients, prescribers and the public have come to expect from Ranbaxy.”