Ranbaxy 1st-qtr 2011 net profit plunges 68% and sales fall 12%

India’s largest drugmaker, Ranbaxy Laboratories RANB: BO), which is 64% owned by Japan’s Daiichi Sankyo, yesterday presented unaudited results for the quarter ended March 31, 2011, showing that sales were down 12.4% to $474 million, though still beating analysts’ forecasts. Profit after tax had plunged 68% to $67 million and EBITDA, at 20% of turnover, also slumped to $95 million compared to $214 million in the like 2010 quarter.

Commenting on the business results for the quarter, Arun Sawhney, managing director of Ranbaxy, said: “We have started the year on a positive note and I am pleased with the sustained performance of key geographies as they continued to deliver superior sales. Leadership initiatives such as Viraat, in India, and a change in business models in some geographies, have also provided further impetus.”

The drugmaker has had a difficult time of late, due to manufacturing problems which have seen many of its products banned from the all-important US market. According to a recent Fortune Magazine report, US federal prosecutors are negotiating a dispute settlement that could cost Ranbaxy more than $1 billion (The Pharma Letter May 5). The settlement relates to accusations by the Food and Drug Administration of manufacturing problems and fraudulent testing. The FDA imposed a temporary ban on all pending and future reviews of drugs from Ranbaxy’s Paonta Sahib facility in February 2009.