Ranbaxy USA Inc., a generic drug maker with plants in India, has pleaded guilty to selling impure drugs. The company also admitted they lied about their practices to the United States government. Because of their actions, Ranbaxy will be paying a record $500 million in fines and penalties. Ranbaxy Laboratories Ltd. has also agreed to plead guilty to criminal charges and to resolve civil claims in all 50 states and the District of Columbia.
This entire case against Ranbaxy is part of the US Food and Drug Administration’s (FDA’s) efforts to hold generic drug makers accountable for better quality standards. Ranbaxy was found guilty of improperly storing drug samples that were waiting to be tested, continuing to sell medication in the U.S. even after it had failed purity tests and delaying a voluntary recall of medication it knew would not maintain its expected shelf life. The payout Ranbaxy will make is due to issues with gabapentin (Neurontin), a medicine used to treat epilepsy and nerve pain. An antibiotic called ciprofloxacin was also involved.
A former executive, Dinesh Thakur, first told healthcare authorities that Ranbaxy had lied to the FDA about drug quality and manufacturing practices. Thakur will be paid almost $50 million for his role as whistleblower. Because of the FDA’s lax foreign plant inspection standards in the past, it is uncertain how the negligence of the Indian Ranbaxy plants would have come to light without the advice from Thakur.
Tainted drugs manufactured outside of the U.S. but sold here have been the subject of urgent focus by the FDA since 2008, when deaths related to Chinese-made heparin started happening. Many want to see foreign manufacturing plants inspected as frequently as domestic plants; a new law in place will allow for inspections every two years. That is, if budgets allow it. In the past, these foreign plants were inspected every seven to thirteen years.
Ranbaxy is not the only foreign drug maker that has been closely examined in recent years nor is it the only one that has made a big payout for its wrongdoing. In 2010, a factory in Puerto Rico connected to pharmaceutical giant Glaxo Smith Kline was found to have had drug safety problems and was subsequently fined $750 million in criminal and civil damages.