Faced with severe trust deficit, Ranbaxy Laboratories is now struggling to rebuild its image. To ensure compliance and accountability, Daiichi Sankyo, the company’s Japanese parent, plans to induct more Japanese executives into Ranbaxy’s senior management and executive team in India, sources said.
Recently, Ranbaxy had appointed Koji Ogawa as head, corporate services, and Dale Adkisson as executive vice-president and head (global quality). Now, both Ogawa and Adkisson are in Ranbaxy’s executive team. The team, part of the company’s senior management, reported directly to the chairman and the board of directors, a company source said.
“Now, the intention and the focus are on building a clean image. A few more Japanese executives are likely to be brought on board in the Indian subsidiary to ensure compliance in processes procedures,” the company source told Business Standard.
Till sometime ago, Ranbaxy had only one Japanese executive, chairman Tsutomu Une, in its active senior management team in India. While Ogawa replaced A S Krishna, who had joined the company about a year ago, Adkisson, earlier with Daiichi Sankyo in the US, was recently shifted to India.
An e-mailed query to Ranbaxy did not elicit a response. Yesterday, a statement by the company said it had been taking specific action to address certain past conduct and ensure the safety and efficacy of all its products available in the global market. The action included “complete reconstitution of the board of directors and the executive management team”.
Early last week, Ranbaxy pleaded guilty to fraudulent statements to the US drug regulator on how it had tested drugs at two of its plants in India. It had agreed to pay $500 million as penalty.
Ranbaxy, earlier a promoter-run company, with majority stake owned by Malvinder Mohan Singh and his family, was acquired by Japanese drug major Daiichi Sankyo in June 2008. Yesterday, Daiichi Sankyo blamed Ranbaxy’s ex-shareholders for concealing and misrepresenting critical information related to the US Department Of Justice and US Food and Drugs Administration (FDA) investigations. It said currently, it was pursuing legal remedies.
However, Singh brushed aside all charges and maintained Daiichi Sankyo had purchased the Singh family’s interests in Ranbaxy after a long negotiations. “At every step during the negotiation process, Daiichi Sankyo and its representatives were made aware of the ongoing US FDA and DOJ investigations. They were also given full access to the documents at Ranbaxy pertaining to US FDA and DOJ investigations,” Singh said. He added during his association with the company, he wasn’t aware of any wrongdoing in it.