Sun Pharmaceutical to acquire Ranbaxy in $4bn deal

Ranbaxy office Some of Ranbaxy's manufacturing facilities have faced US scrutiny

Related Stories

India's Sun Pharmaceutical has agreed to acquire rival Ranbaxy - majority owned by Japan's Daiichi Sankyo - in an all-stock deal worth $4bn (£2.4bn).

The combined entity will be India's largest pharma company and the world's fifth-biggest generic drugs maker.

It comes at a time when Ranbaxy is under the scrutiny of US regulators who have imposed import bans on drugs manufactured at some of its facilities.

The agreement still needs shareholder and regulatory approvals.

"Ranbaxy has a significant presence in the Indian pharma market and in the US," Dilip Shanghvi, managing director of Sun Pharma said in a statement.

"In high-growth emerging markets, it provides a strong platform which is highly complementary to Sun Pharma's strengths."

Quality issues

Earlier this year, the Food and Drug Administration (FDA) banned Ranbaxy from producing and distributing drugs for the US market from its Toansa facility in Punjab - the company's fourth facility to face such a ban.

The US drug regulator said there had been "significant" manufacturing violations at the facility.

It alleged that staff had conducted tests on materials that had already failed initial tests "in order to produce acceptable findings".

The firm has also received a subpoena from the US Attorney for the District of New Jersey asking it to produce certain documents relating to issues previously raised by the FDA with respect to the Toansa facility.

As part of the sale agreement, Ranbaxy's majority shareholder Daiichi Sankyo agreed to "indemnify Sun Pharma and Ranbaxy for, among other things, certain costs and expenses that may arise from the subpoena".

Ranbaxy is not the only firm to have products from some of its units banned by the US.

Last month, the US imposed a ban on imports from a division of Sun Pharma as well. It said the unit was not "operating in conformity with good manufacturing practices".

Overall, the FDA has put more than 30 Indian manufacturing units on its "import alert" list.

This is, effectively, a ban as it warrants the "detention of either particular products or all products manufactured by a firm" at the facility in question.

More on This Story

Related Stories

The BBC is not responsible for the content of external Internet sites

More Business stories

RSS

Business Live

  1.  
    09:43: Rental prices
    rents

    Private rental prices paid by tenants in Great Britain rose by 1.7% in 2014, according to the Office for National Statistics. A 2% rise in Scotland led the charge, while English rents grew 1.8%, and 0.2% increases were logged in Wales. As can be seen, London rent rises have outgunned the rest of the country.

     
  2.  
    09:32: Bank of England lending data

    Mortgage approvals rose in December for the first time since June, the Bank of England said. This could mean that a steady reduction in home loans could be ending. There were 60,275 mortgage approvals last month, up from 58,956 in November.

     
  3.  
    Via Twitter Richard Westcott BBC transport correspondent

    tweets: BBC News - Crossrail makes tunnel breakthrough under Liverpool Street Station

     
  4.  
    09:12: Plane order
    ana

    All Nippon Airways has placed an order with a list price of $2.2bn (£1.46bn) for 15 planes from Boeing and Airbus. The Japanese flag carrier is looking to expand routes at Tokyo's central Haneda airport. The airline said it would acquire eight planes from US-based Boeing and seven from fellow duopolist Airbus.

     
  5.  
    08:54: Eurozone crisis
    Alexis Tsipras

    Watch out for Greek fire. Or, continuing the Greek theme, maybe we'll see the golden mean. The prime minister who heads the nation's new anti-austerity government, Alexis Tsipras, has it in his diary to meet Jeroen Dijsselbloem, the current head of the eurozone group of finance ministers today to discuss the conditions of Greece's massive bailout.

     
  6.  
    BT results 08:37: Via Twitter Rory Cellan-Jones Technology correspondent

    tweets: BT says ultrafast coming within a decade - but will it look that fast in 2025?

     
  7.  
    08:29: Honda
    honda

    Honda cut its annual operating profit forecast by 6.5%. It has set aside more cash to cover its recall of cars to replace potentially faulty air bags. It now expects an operating profit of 720 billion yen (£4.1bn) for the year to March 31. It previously forecast 770 billion yen.

     
  8.  
    08:16: Paper review
    papers

    The Guardian splashes on a report from the Institute for Fiscal Studies which claims young workers have been hit hardest by a squeeze in standards of living. The FT digests Shell and US rival ConocoPhillips's investment cancellations. The Wall St Journal says bets against currency pegs, like Denmark's krone with the euro, are on the rise following Switzerland abandoning theirs. The Telegraph reports on a likely windfall for gas companies as wholesale costs drop.

     
  9.  
    Google results Via Twitter Stephen Shankland Senior writer at CNET News

    tweets: Google's capital expenditures jumped $1.13 billion sequentially to $3.55 billion in 4Q2014. Data centers ain't cheap.

     
  10.  
    07:50: Market update

    Japan's Nikkei index added about 0.4%, clawing back some of the 1.1% lost yesterday, while the Hong Kong Hang Seng index dropped 0.1%, to 24,570.01. Japanese factory output rose 1% from the previous month, below forecasts, while household spending fell more than expected, down 3.4% on a year ago.

     
  11.  
    07:33: PPI investigation

    The Financial Conduct Authority, the City watchdog, is planning to "gather evidence on current trends in complaints on payment protection insurance," it says. It could then decide to do an advertising campaign, a time limit on complaints or keep things as they are.

     
  12.  
    07:25: BT results

    BT have updated everyone on their pension fund situation and how they will deal with a £7bn deficit. BT will pay £1.5bn into the fund by the end of April 2015. This will be followed by £250m in each of the years to March 2016 and March 2017. Low interest rates have hit the fund.

     
  13.  
    07:16: Qatar Airways
    Qatar Airways plane

    Qatar Airways has acquired stake of just less than 10% in BA and Iberia-owner IAG. There's a cap on non-EU ownership of European airlines, but Qatar Airways might up its stake in future, it says.

     
  14.  
    07:05: BT results

    BT says third-quarter earnings before tax and interests costs rose 2% to £1.57bn. Gavin Patterson, chief executive says: "All the major communications providers are responding to the strong market demand for fibre broadband, helping to drive take-up in what is already a very competitive market."

     
  15.  
    06:57: US growth data BBC Radio 4

    US growth figures will be reported later on. What's the likely result, Today asks Ewen Cameron Watt of Blackrock? "The rate of growth is slowing a little bit but not enough to raise serious concerns," he says. Expect a "stable but robust rate of growth."

     
  16.  
    06:45: Greece Radio 5 live
    Greece

    Guntram Wolff is the director of European think tank Bruegel, and he's on 5 live, talking about Greece. "It was a mistake that Greece joined the euro, but it would now be a mistake for it to leave," he says. "We will have to come to a deal that will have a lower burden on Greece. I essentially think you will keep the nominal amount [owed to bond investors] but you will increase the maturity.. from 30 to 40 or 50 years."

     
  17.  
    06:30: Amazon results Radio 5 live

    More from Ewen Cameron Watt of investment manager Blackrock on 5 live. He is giving his views on US results overnight. "Amazon and Google both essentially reported that underlying demand over Christmas was pretty decent," he says. After tax, margins at Amazon are below 1%, he says.

     
  18.  
    06:20: Trademark news Radio 5 live
    swift

    The phrases "this sick beat" and "nice to meet you, where you been" have been trademarked by singer Taylor Swift, 5 live reports. Laura Harper of law firm Shoosmiths says she is trying to stop other people making money by putting the phrases on a t-shirt or other merchandise. She will have to prove the phrases are "synonymous" with her, she says.

     
  19.  
    06:09: Shell results Radio 5 live
    shell

    Ewen Cameron Watt of Blackrock is the markets guest on 5 live, talking about yesterday's results from Shell. "These are very historic results because they reflect an average price of $75" per barrel of oil, he says. Bearing in mind oil is below $50 today, "the pain is yet to come," he adds. The firm has cut $15bn of investments. The longer the price remains at this level, the more likely more investment cuts will come, he says.

     
  20.  
    06:01: House building Radio 5 live

    Figures from the National House Building Council show there was a 9% rise in homes built last year to 145,174, but the rise missed the government's 200,000 home target. Peter Vella of Countryside Properties is on 5 live. NHBC's figures don't take into account all homes started or built, so the industry could be closer to the target than thought.

     
  21.  
    06:00: Howard Mustoe Business reporter

    Good morning all. Overnight, online retail giant Amazon has reported weaker profits for the busy Christmas period. Stay tuned for the best business and economics news and get in touch via email bizlivepage@bbc.co.uk or on twitter @BBCBusiness

     

Features

Copyright © 2015 BBC. The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.