Daiichi Sankyo pledges bold action on Ranbaxy production problems

TOKYO Fri Jan 31, 2014 8:01pm IST

A man rides a motorcycle in front of the office of Ranbaxy Laboratories at Gurgaon, on the outskirts of New Delhi, June 13, 2013. REUTERS/Adnan Abidi/Files

A man rides a motorcycle in front of the office of Ranbaxy Laboratories at Gurgaon, on the outskirts of New Delhi, June 13, 2013.

Credit: Reuters/Adnan Abidi/Files

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TOKYO (Reuters) - Japan's Daiichi Sankyo Co Ltd (4568.T) said it would step up support of Indian drugmaking arm Ranbaxy Laboratories Ltd (RANB.NS) and send personnel to help resolve problems at a factory that U.S. regulators have banned from supplying pharmaceutical ingredients.

"We have already put a lot of effort into our support but that has not been enough," Manabu Sakai, senior executive officer at Daiichi Sankyo, told an earnings briefing on Friday.

"We want to go back and prepare a more aggressive, more drastic response."

Sakai said it was inevitable the incident would affect Daiichi Sankyo's earnings but was unable to give concrete numbers. The company is not thinking about reducing its stake in Ranbaxy, he added, although financial support would be among the actions it will look at.

The U.S. Food and Drug Administration last week banned Ranbaxy's Toansa plant, a key supplier of ingredients to the generic drugmaker's U.S. factory, from sending its products to the United States due to manufacturing violations. It was the fourth Ranbaxy plant to be shut out of the U.S. market.

"There's been a steady increase in the things that we need to do," Sakai said, adding Daiichi Sankyo would dispatch additional personnel to the plant to help sort out problems.

Daiichi Sankyo's shares are down nearly 10 percent since last week's news on the Toansa plant. On Friday, they rose 2.7 percent to 1,723 yen, bouncing from a five-month low hit the day before.

(Reporting by Ritsuko Shimizu; Editing by Edmund Klamann and Mark Potter)

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