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Should bury data, said Ranbaxy chief when R&D head revealed fudge: Tribunal order

by August 12, 2016 General
Written by Deepak Patel | New Delhi | Published:August 12, 2016 2:33 am

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ON October 14, 2004, Rajinder Kumar, head of R&D, presented the Self Assessment Report (SAR) to the company’s science committee detailing how the pharma giant had “falsified data” for more than 200 drugs to obtain quick regulatory approvals from authorities in over 40 countries.

Present in the room were chairman Tejendra Khanna; Malvinder Singh, then president of pharmaceuticals and Ranbaxy’s owner; Brian Tempest, Chief Executive Officer (CEO); and top executives.

Khanna, according to Tempest who recalled that meeting at the Singapore arbitration tribunal, “said something to the effect that ‘Ranbaxy should just bury the data.” As reported Thursday, the order implicates the Ranbaxy top brass in a range of alleged irregularities.

Apparently frustrated at how the top management had responded to his findings, Kumar resigned the next day. Seven months later, in a letter to the management, he put on record some of the responses at the meeting: One board member (said): “Can we bury the data.” Falsification of data, said another senior Ranbaxy executive, only happened with few products and everyone did it.

Chairman Khanna quit the board three years later and was appointed by the UPA government as Lieutenant Governor of Delhi.

Significantly, the minutes of this crucial science committee meeting — circulated internally — made no mention of the SAR or of any board member’s response to the document.

In his letter on April 20, 2005, Kumar expressed his disappointment with the Ranbaxy management and, referring to the October 14 meeting, said that he had presented a plan to resolve the SAR issues.

Read | Singapore tribunal reveals how Ranbaxy ‘buried info on fraud, duped its owners’

When contacted by The Indian Express, Khanna said: “The statement supposedly attributed to me by Dr Brian Tempest is completely denied. I always stood for complete and unfailing compliance with all regulatory requirements and emphasised that Ranbaxy should maintain an impeccable and zero tolerance record in such matters. In my Chairman’s messages which can be seen from published Annual Reports of the Company, there were unequivocal exhortations to maintain highest standards of quality assurance and regulatory compliance”.

Tempest did not reply to an emailed query from The Indian Express.

The tribunal fined Malvinder Singh and his brother Shivinder Singh Rs 3,500 crore for defrauding Daiichi Sankyo by “deliberately” withholding information about the SAR and its significance from the Japanese pharma company. Daiichi had purchased a majority stake in Ranbaxy from the Singh brothers and for Rs 19,804 crore on November, 2008.

The tribunal noted that SAR, which was forwarded to the US Food and Drug Administration by Kumar’s principal assistant Dinesh Thakur in 2005, was the basis of investigations by USFDA and the US Department of Justice. It culminated with Ranbaxy, under Daiichi, paying $500 m to the DOJ in 2013.

Internal emails exchanged between Tsutomu Une, Ranbaxy Board chairman and Daiichi Sankyo’s points person in India, and Daiichi’s consultant Dick Van Duyne also reinforce the tribunal’s indictment.

On November 19, 2009, according to the tribunal, well over a year after Daiichi acquired Ranbaxy, Une commented that the DOJ had a “smoking gun” (a reference to the SAR) that could have, according to his diary entry for that day, created a “high possibility of a criminal penalty”.

In due course, this and Une’s other diary entries had a central role in the indictment.

Une’s email to Daiichi’s consultant Duyne noted that “the bad thing is the involvement of top management in the current compliance issues are identified”. He also recorded that he had come to know that Ranbaxy “management wanted the evidence destroyed”.

Van Duyne wanted to know who was this “top” management. Une replied: “The in-house email communications before 2006 has been provided by the whisperer…and DOJ found out that R’s (Ranbaxy’s) auditor as well as outside auditor cautioned to the Board members the issues which are exactly the same reasons as those relevant to the AIP (Application Integrity Policy).”

The FDA had invoked AIP which effectively suspended all new or pending applications or supplemental applications for drug approval against Ranbaxy on February, 2009.

Une added: “Furthermore, Dr Tempest and MS (an apparent reference to Malvinder Singh) ordered to break all the documents relating to the issues.This is the reason why the cases could be criminal even (though) no patients was (sic) harmed by the products. Also this is why FDA insists the issues caused by the corporate culture.”

RHC Holding, where Malvinder and Shivinder Singh are the promoters, was asked specifically by The Indian Express about this statement of Une talking about Malvinder Singh asking to “break (discarding) the documents.” The company replied: “The matter is sub judice and we cannot offer any comment in view of the confidentiality requirements.” Une, who is still with Daiichi Sankyo, did not respond to queries from The Indian Express.