A public interest suit has been filed against the directors of pharmaceuticals major Ranbaxy Laboratories for allegedly manufacturing adulterated drugs.
The petition, filed in the Supreme Court, sought prosecution of all current and former directors of the company. Manohar Lal Sharma, the petitioner, also sought sealing of the company’s manufacturing facilities at Paonta Sahib and Devas in Madhya Pradesh. Sharma has mentioned the Central Bureau of Investigation (CBI) as one of the respondents in the case.
A Ranbaxy spokesperson said the company didn’t receive any official communication on this and, therefore, it wasn’t in a position to comment.
The suit follows the $500-million fine Ranbaxy had to pay in the US after the US Food and Drugs Administration charged it with making and selling “adulterated” drugs.
The suit was mentioned before a bench of judges Gyan Sudha Misra and Madan B Lokur. The bench asked Sharma to complete the technical requirements with the registry before it could be taken up. It said the petition could be heard next week.
Sharma sought a direction for prosecution of Ranbaxy’s current and former directors. He also sought a bar to further sales of drugs manufactured by the pharmaceuticals company, as well as the seizure of the entire properties of its directors. He claimed despite Ranbaxy pleading guilty to supplying adulterated drugs in the US and being fined such a huge amount, the Centre hadn’t taken any action to prohibit or ban drugs made by the company. Sharma also sought action against the drug regulator, Central Drug Standards Control Organization for permitting Ranbaxy to sell drugs in India, especially after the results of the US FDA investigation against the company.
The petition said Jaslok Hospital had banned medicines supplied by Ranbaxy. Sharma alleged Ranbaxy had been supplying adulterated drugs in India, as well as in other countries, and this was punishable under the Drugs and Cosmetics Act. “It is not a tale of cutting corners or lax manufacturing practices, but one of outright fraud, in which the company knowingly sold substandard drugs around the world, including in India, Africa and the US, while working to deceive regulators,” the petition said.
In 2004, when the company’s manufacturing practices had allegedly violated norms, the company had eminent people from all walks of life in its board. It had eight independent directors, including then chairman Tejendra Khanna, now the lieutenant governor of Delhi; DCM family scion Vivek Bharat Ram; Gurcharan Das; senior cardiologist P S Joshi; ace investment banker Nimesh N Kampani; consultant Vivek Mehra; senior lawyer Surendra Daulet-Singh and foreign trade expert J W Balani.
Recently, some Ranbaxy directors had told Business Standard they didn’t believe there was a fraud in the company, and the plea bargain settlement was a business decision by the company’s new owners Daichii Sankyo, which had acquired it from erstwhile promoters Malvinder Mohan Singh and Shivinder Mohan Singh in 2008.