Dr Reddy's Labs inches up after settlement with US Govt

Dr Reddy's Laboratories rose 0.50% to Rs 2,406.55 at 10:57 IST on BSE after the company said it reached a settlement with the US Government regarding the firm's compliance with the Consumer Product Safety Act.

The announcement was made during trading hours today, 19 December 2017.

Meanwhile, the S&P BSE Sensex was up 116.86 points, or 0.35% to 33,718.54.

On the BSE, 16,000 shares were traded in the counter so far, compared with average daily volumes of 42,000 shares in the past two weeks. The stock had hit a high of Rs 2,422.20 and a low of Rs 2,405.50 so far during the day. The stock hit a 52-week high of Rs 3,203.95 on 6 January 2017. The stock hit a 52-week low of Rs 1,901.65 on 11 August 2017.

The US subsidiary of Dr Reddy's Laboratories announced that it has reached a settlement with the US Government, in a case that is more than six years old, involving packaging for five blister-packed prescription products. In a joint filing by the parties, Dr Reddy's and the US Department of Justice agreed to the settlement of the action without any adjudication of any issue of fact or law.

Dr Reddy's has taken this investigation seriously, cooperating with the Government over the past six years. The safety of patients and consumers is of paramount importance to Dr Reddy's, and the company firmly disagrees with the Government's allegations. However, in order to avoid any unnecessary costs and the distractions of prolonged litigation, the company has chosen to settle the matter for USD five million.

Dr Reddy's is not aware of any reports that any child gained access to these products as a result of the packaging or that any of the products caused children harm as a result of the packaging. These products have not been distributed in the packaging at issue since June 2012. Dr Reddy's said it remains firmly committed to complying with all applicable requirements of the Consumer Product Safety Act, including applicable packaging and reporting requirements.

On a consolidated basis, Dr Reddy's Laboratories' net profit fell 1.1% to Rs 305.40 crore on 1.1% decline in net sales to Rs 3546 crore in Q2 September 2017 over Q2 September 2016.

Dr Reddy's Laboratories is an integrated global pharmaceutical company.

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