A day after pharma major Daiichi Sankyo alleged that certain former shareholders of Ranbaxy concealed and misrepresented critical information about the US justice department and the USFDA probe, former Ranbaxy CEO Malvinder Singh denied any wrongdoing.
Malvinder said that at no stage had he concealed any information relating to investigations by the US department of justice and the Food and Drug Administration. “Nothing was kept away from Daiichi Sankyo It was they who approached us to buy the company; there was proper due diligence, long dialogue, all papers relating to US DoJ and FDA were shown to them.”
Singh also said that Ranbaxy had not received any legal notice from Daiichi.
"When a company decides to invest billions of dollars into a business, it is not possible that the appropriate due diligence has been ignored," Singh told CNBC-TV18.
The former Ranbaxy CEO claimed that Daiichi had spent months trying to push the deal through and enough time was given for due diligence.
"It was a business decision that Daiichi Sankyo made with their ears and eyes open because news about the USFDA probe was in the public domain," he said.
"The belated suggestion, made years after the fact, that information was concealed from and/or misrepresented to Daichii Sankyo is false and designed to divert attention away from Daiichi Sankyo's own failures to protect itself and its shareholders in the negotiations and agreement with the Singh family shareholders of Ranbaxy," the statement said.
Daiichi spent $4.2 billion in 2008 to acquire 63.9 percent stake in Ranbaxy from the controlling shareholder group, led by brothers Malvinder Singh and Shivinder Singh. The firm’s troubles with the US drug regulator were revealed to the public only after the deal.
The Singh brothers, together worth $2.6 billion, according to Forbes, control Fortis Healthcare( and financial services group Religare Enterprises. Malvinder Singh, now 40, had agreed to remain as CEO of Ranbaxy, India's largest drugmaker by sales, for five years following Daiichi Sankyo's takeover but left in 2009.
Last week, Ranbaxy pleaded guilty to felony charges related to drug safety and agreed to pay $500 million in civil and criminal fines under a settlement with the US Department of Justice.
Ranbaxy’s $500 million fraud settlement is the largest in history involving a generic manufacturer and drug safety.
The company acknowledged that it failed to conduct proper safety and quality tests of several drugs manufactured at the Indian plants, including generic versions of common medicines, like gabapentin, which treats epilepsy and nerve pain, and the antibiotic ciprofloxacin.
Singh also denied allegations made by former Ranbaxy employee Dinesh Thakur who said that the senior management at the company had actually falsified and concealed data.