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Fundamentals May 15, 2013

Nik's Diary

The Indian markets openED flat today with a positive bias tracking positive opening in SGX Nifty which is trading higher by 0.45%. Most of the Asian markets too are trading in the green. The US stocks, extending the upward trend seen over the past month, moved notably higher on Tuesday despite negative sentiment generated by the news that JP Morgan (JPM) lowering its growth outlook for the Chinese economy. The gains lifted the Dow and the S&P 500 to new record highs, while the Nasdaq set another new twelve-year high. Meanwhile, the European markets were weak in early trade Tuesday, largely due to the smaller than anticipated increase in German investor confidence. However, the markets reversed direction after investors were encouraged by the positive performance of the U.S. markets. Indian markets posted modest gains on Tuesday after government data showed India's headline inflation slowed for a third straight month in April, allowing room for the RBI to extend monetary easing to revive flagging growth. Inflation based on the wholesale price index slowed to a 41-month low of 4.89% in April from 5.96% a month ago, with prices of food, manufacturing products, fuel and power all showing a tendency to decline.

Ranbaxy settles the US suit
A subsidiary of Indian generic drug-maker Ranbaxy Laboratories has pleaded guilty to federal charges of selling adulterated drugs with intent to defraud and agreed to pay $500 million to resolve false claim allegations. The U.S. justice department described as "the largest drug safety settlement" with a generic drug-maker related to manufacture and distribution of certain adulterated drugs made at two of Ranbaxy U.S. Inc's manufacturing facilities at Paonta Sahib and Dewas in India. The whistleblower, Dinesh Thakur, has been rewarded $49 million in arrangement after Ranbaxy decided to pay $500 million (2, 737 crore) to resolve the 5 year old case. Thakur pulled up the curtain of all the indiscretion in the company. He said that the company had been warned with the troubles, but when they were unsuccessful to correct the problems, he was left with no other choice then to inform the health care authorities. Ranbaxy also agreed to pay a criminal fine and forfeiture totalling $150 million and to settle civil claims under the False Claims Act and related State laws for $350 million, the department said in a media release. Ranbaxy U.S. pleaded guilty to three felony counts under the federal Food, Drug and Cosmetic Act (FDCA), and four felony counts of knowingly making material false statements to the Food and Drug Administration (FDA), it said. This is the largest false claims case ever prosecuted in the District of Maryland, and the nation's largest financial penalty paid by a generic  Pharmaceutical company for FDCA violations," said US Attorney for the District of Maryland Rod J. Rosenstein. "The joint criminal and civil settlement, which reflects many years of work by FDA agents and federal prosecutors, holds Ranbaxy accountable for a pattern of violations and should improve the reliability of generic drugs manufactured in India by Ranbaxy," he said. Ranbaxy USA admitted to introducing into interstate commerce certain batches of adulterated drugs that were produced at Paonta Sahib in 2005 and 2006, including Sotret, gabapentin, and ciprofloxacin, the justice department said. Sotret is Ranbaxy's branded generic form of isotretinoin, a drug used to treat severe recalcitrant nodular acne; gabapentin is a drug used to treat epilepsy and nerve pain; ciprofloxacin is a broad-spectrum antibiotic. Ranbaxy U.S. acknowledged that FDA's inspection of the Paonta Sahib facility in 2006 found incomplete testing records and an inadequate programme to assess the stability characteristics of drugs, the justice department said. The company also admitted to making false, fictitious, and fraudulent statements to the FDA in Annual Reports filed in 2006 and 2007 regarding the dates of stability tests conducted on certain batches of Cefaclor, Cefadroxil, Amoxicillin, and Amoxicillin and Clavulanate Potassium, which were manufactured at the Dewas facility, it said. Ranbaxy U.S. was found to have conducted stability testing of certain batches of these drugs weeks or months after the dates reported to FDA, the department said. In a statement on the conclusion of the U.S. investigation, Ranbaxy said it had on Dec 20, 2011 signed a consent decree with the FDA agreeing to "further strengthen procedures and policies to ensure data integrity and to comply with current Good Manufacturing Practice (cGMP)". Source: INDOlink

IVRCL bags orders worth `639cr
IVRCL Ltd has bagged new orders worth Rs 638.88 crore, including one order in the United Arab Emirates. The Buildings Division of the Hyderabad-based infrastructure company has bagged an order to be executed in Abu Dhabi, United Arab Emirates worth Rs 139 crore and another order from Department of Space, Bangalore, worth Rs 44 crore. In a statement to the stock exchange, the company has informed that other orders worth Rs 445.54 crore are from the transportation division, including a Rs 109.95 crore order in Karnataka, another Rs 129 crore order in Indore and one more Rs 206.56-crore order from Rail Vikas Nigam Ltd. The Rail Vikas Nigam project order is to be completed within 24 months. Source: hindubusinessline



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