Sun Pharma Axes 18 Top Ranbaxy Laboratories Executives
Eighteen executives at Ranbaxy Laboratories, including Indrajit Banerjee, the company president and chief financial officer, were terminated by parent company Sun Pharmaceutical Industries Ltd., the Economic Times of India reported this morning.
More pink slips are expected to be delivered as Ranbaxy undergoes a restructuring following acquisition by Sun Pharma, the International Business Times reported. An unnamed source told the Economic Times that the executive culling would impact approximately 150 individuals. Other executives terminated this week include Yugal Sikri, country head (India) Ranbaxy; Maninder Singh, vice president of marketing; Govind Jaju, global head of sourcing and Ratul Bahaduri, the director of finance, the Economic Times reported.
The merger of the two companies was completed in March, and Sun Pharma began to shift its own people into leadership roles. Sun Pharma founder and Managing Director Dilip Shanghvi announced the changes in a memo sent to Sun Pharma employees following the merger, saying, “The leadership team members will report to me. This leadership structure is effective from Day 1 of merger.” Some of the shifting positions included moving Sun Pharma’s North American chief Kal Sundaram to head the merged entity’s U.S. and Canadian markets. Michael Perfetto, chief commercial officer of Sun’s Generic and Over the Counter unit was named to head the same position in the merged company. Abhay Gandhi, Sun Pharma chief executive in India, was tapped to lead the Indian subcontinent, while Aalok Shanghvi, son of Dilip Shanghvi and vice-president of Sun Pharma, will named to lead the emerging markets business.
Before merging with Sun Pharma, Ranbaxy was acquired by the Japanese firm Daiichi Sankyo, Inc. in 2008. Most of the executives issued pink slips were brought in following the Japanese acquisition, the Economic Times noted. Combined sales force of the two firms is nearly 30,000 in India and abroad.
Sun Pharma, based in Mumbai, acquired Ranbaxy for $3.2 billion from Daiichi in 2014. As part of the deal Daiichi received its stake of 214,969,058 shares in Sun Pharma. Founded in 1983, Sun Pharma has a portfolio of more than 3,000 molecules to treat multiple ailment, including psychiatry, neurology, cardiology, orthopedic, diabetes-related illnesses, gastroenterology, ophthalmology, urology, dermatology, gynecology, respiratory, oncology, dental and nutritionals.
The merger propelled Sun Pharma into the top five generic drugmakers in the world, with products sold in more than 150 nations across five continents. The merger is expected to allow Sun Pharma to expand its research and development capabilities and enhance its product pipeline in established markets, such as the United States, as well as in emerging markets.
“The combined entity will capitalize on the expanded global footprint and enhance our dominance as a world leader in the specialty generics landscape,” Israel Makov, Chairman of Sun Pharma said in a statement following the merger.
Following the merger, Sun Pharma reported sharp drop in profit of 44 percent during the quarter ending in March. Sun Pharma officials said the decline was due, in large part, to the merger with Ranbaxy.
Before Daiichi divested itself of Ranbaxy, the U.S. Food and Drug Administration (FDA) the banned the sale of medicine from Indian drug maker Ranbaxy, which the Japanese company bought a large stake in 2008. Due to manufacturing violations, medical supplies from one of Ranbaxy Laboratories plants were banned from sending its products to the United States.
In March Daiichi Sankyo announced it was divesting itself of 8.9 percent stake in Sun Pharma, India’s largest drugmaker, on the Indian stock exchange. The company said it is selling the Sun Pharma shares, which were acquired following the completion of Sun Pharma’s merger with Ranbaxy Laboratories Limited, from the “perspective of corporate value.”
The Economic Times of India reported the sale will not totally compensate Daiichi for the $4.6 billion it spent when it acquired Ranbaxy. However, the sale will help the Japanese company boos earnings, the paper reported.
June 18, 2015
By Alex Keown, BioSpace.com Breaking News Staff