Ranbaxy pulls anti-depressant from Europe

Even as the country's second-largest drug maker Ranbaxy Laboratories is still to sort out its regulatory problems in the US market, it has run into fresh trouble in Europe, primarily UK and Denmark, for not adhering to stipulated safety warning requirements.

The UK arm of the company owned by Japan's Daiichi Sankyo has been asked by the UK drug regulator Medicines and Healthcare Products Regulatory Agency to recall three lots of anti-depressant drug Mirtazapine (strength-15 mg and 45 mg) for not including safety warning mandated by the European Medicines Agency, the European regulatory agency responsible for giving marketing approval.

More importantly, the drug regulator has put other drugs from the company under review citing similar defaults in the past. On Tuesday, the company's stock closed at Rs 449.50 on BSE (^BSESN : 16458.81 -416.95), down 1.08% from its previous close.

An analyst tracking the company said: "Unfortunately for Ranbaxy, recurring problems with drug regulators have become a matter of habit. While this recall would not mean any major financial loss, it adds to the scars on the company. The good part is that the nature of the problem looks temporary and looks fairly solvable and doesn't involve manufacturing issues, for which Ranbaxy is facing heat in the US."

"The bad part is, regulators in matured markets keenly watch each other's action and take cues," added the analyst

Confirming the development, a Ranbaxy spokesperson said: "Ranbaxy Europe has initiated the select batch recall of three products: two in the UK and Denmark , and one in Ireland . The recall is being carried out, as patient information leaflets need to be updated to include safety warnings initiated by the European Medicines Agency."

The spokesperson clarified that the process is being undertaken in consultation and agreement with the competent authorities. "There are no product quality concerns. To ensure effective corrective and preventive action, the company is conducting a comprehensive review, in consultation with authorities." The drugs in question, which were distributed by Ranbaxy between May 2009 and March 2010, were about to expire between January and December 2012. The drug recall has been classified as class II type, the second level of severity, which mandates the company to start acting within 48 hours.

"The company (Ranbaxy) has already recalled all unexpired stock of Sertraline Tablets 50 mg and 100 mg for the same reason. Other products are currently being reviewed," said an MHRA official letter by Alison Bunce, pharmaceutical assessor, Defective Medicines Report Centre. Sertraline is another anti-depressant drug used in adult outpatients for obsessive compulsive and panic and social anxiety disorders.

The contribution of EU markets to Ranbaxy's global revenues was around 17% in financial year 2009. In March, the drug-maker had recalled an antibiotic containing Amoxicillin and Clavulanate Potassium used to treat ear, skin and urinary tract infections, from the US market.

While the financial implications for the company on this account would be insignificant considering the size of recall, for a company that is already facing an image crisis, getting into any regulatory problem in new geographies particularly in the regulated markets is troublesome news.