Ranbaxy trading volatile after USFDA revoked tentative approvals

Ranbaxy has recovered after early morning decline and is currently trading flat

Ranbaxy has recovered and is currently trading flat at Rs 653.70 on BSE. In early morning trade the stock had declined around 3% to Rs 635.10 on BSE  after U.S. Food and Drug Administration (FDA) revoked the six months exclusivity for generic version of Roche Holding AG's antiviral Valcyte and the tentative approval to make a generic version of AstraZeneca's heartburn drug Nexium granted to the pharma major.
 
The approvals were revoked citing the compliance status of Ranbaxy production facilities. According to the statement by Ranbaxy, FDA also added that"its original decisions granting tentative approvals were in error because of the compliance status of the facilities referenced in the ANDAs at the time the tentative approvals were granted." However, FDA has not raised any data integrity issues related to the filing for the two drugs by Ranbaxy, the statement said.

 
Ranbaxy was the first company to receive tentative approvals to launch generic versions of the two drugs as long ago as 2008, making it eligible to exclusively market the medicines for six months - a huge revenue generating opportunity.
 

Sun Pharma which is in the process of acquiring Ranbaxy for $3.2 billion has also rebounded sharply after declining around 1.2% on BSE and is now gaining around 1.4%.
 
Ranbaxy's shares opnened at Rs 624 and have hit a low of Rs 623 till 10:15 AM while around 11,00,000 shares have changed hands on BSE and NSE combined.