Washington, DC: Ranbaxy Laboratories Ltd, is facing
consumer fraud class action lawsuit filed by US retailer Meijer Inc, in the US District Court in Massachusetts, over allegations the generic drugmaker manipulated US Food and Drug Administration (FDA) rules for year, in order to keep rival generic drugs out of the US market.
According to the lawsuit, Ranbaxy filed "grossly inadequate" applications seeking approval for its drugs and deceived the FDA into granting approvals and giving the company market exclusivity. India's largest drugmaker Sun Pharmaceutical Industries Ltd, is also named as a defendant, the company paid $3.2 billion to buy Ranbaxy in March.
According to the complaint, customers overpaid for Roche's antiviral Valcyte and Novartis's hypertension drug Diovan due to the delay of generic versions because Ranbaxy having wrongfully gained market exclusivity. Drugmakers that are first to file with the FDA to make a generic version of a brand name drug are entitled to a six-month market exclusivity, a massive competitive advantage in a highly profitable market sector. Companies such as Ranbaxy compete for these advantages. The lawsuit claims that Ranbaxy made repeated misstatements to the FDA regarding the compliance status of its manufacturing plants. In 2013, Ranbaxy pleaded guilty to felony charges related to drug safety and agreed to civil and criminal fines of $500 million in a settlement with the United States to resolve claims that it sold substandard drugs and made false statements to the FDA about manufacturing practices at its plants. The FDA had banned import of Ranbaxy drugs made in the company' Indian plants.
In November 2014, The stripped Ranbaxy of a tentative approval and six-month exclusivity it gave the company in 2008 for launching a Valcyte generic.
In the lawsuit, Meijer is seeking damages and monetary relief on behalf of all direct purchasers of drugs for which the release of cheaper copies was delayed due to market exclusivity secured by Ranbaxy.
