The chief of Indian drugmaker Ranbaxy Laboratories tried to reassure investors Wednesday, saying that the accusations about its low-cost, generic medicines were part of a conspiracy to undermine the company.
Ranbaxy's shares had dipped sharply the last two days after it was reported that the U.S. Justice Department had filed a court motion demanding the drugmaker turn over documents the agency hopes will prove the company fabricated data about the quality of its drugs.
"People are trying to create confusion and obviously somebody is trying to bring our price down so that they can (buy) at a lower price," said Ranbaxy Chairman and Managing Director Malvinder Mohan Singh. "A multinational (company) and a leading Indian company are working in concert to bring our share price down," he said, without naming the companies.
The company's shares rose sharply on Wednesday on Singh's comments, closing 15 percent higher at Rs 470.70.
Singh again denied the accusations brought by the Food and Drug Administration. He also said the investigation would not affect Ranbaxy's business or derail the drugmaker's sale to Japan's Daiichi Sankyo Co. The $4 billion deal was announced last month.
Despite the investigation, "our business in the U.S. continues as normal," Singh told reporters. "We continue to file for approvals from the U.S. FDA and are also getting" them.
Singh said Daiichi Sankyo was "aware of these issues while conducting due diligence. There is no change in the deal and there is no exit clause in it."
Ranbaxy is India's largest pharmaceutical company and claims to be the world's 10th-largest generic drugmaker.
The U.S government has been investigating Ranbaxy since 2006, when the FDA issued a warning letter over manufacturing violations found at a company plant in India. Ranbaxy officials have since been working with U.S. regulators to resolve the issue.
The company has argued that documents sought by the Justice Department were proprietary. U.S. officials went to a federal court in Maryland earlier this month in hopes of forcing the company to hand over the material.
Singh said Wednesday that his company would cooperate with the investigation and provide all the information required, although it was not clear if he meant the company would hand over the documents sought by the Justice Department.
U.S. investigators hope the documents will prove Ranbaxy fabricated data to convince FDA officials to approve the sale of its products.
Additionally, the government alleges Ranbaxy uses unapproved ingredients and diluted amounts of ingredients in its drugs.