Ranbaxy sinks 9% ahead of FDA inspection of Toansa unit

Ranbaxy shares fell as much as 9 per cent on Monday on reports that the US Food and Drug Administration will begin inspection at the drugmaker's Toansa facility in Punjab. Ranbaxy is India's biggest drugmaker by sales.

The Toansa unit accounts for 70-75 per cent of APIs (active pharmaceutical ingredient) used in Ranbaxy formulations, analysts said. US drug inspectors had highlighted several violations at the facility in late 2012.

As of 11 a.m. Ranbaxy shares traded 7.3 per cent lower at Rs 430 on the NSE as against a 0.5 per cent drop in the BSE Healthcare index. The stock had earlier hit a low of Rs 425. (Track stock)

The FDA has rapped Ranbaxy over manufacturing quality at many of its facilities in the past. Only last year, an import alert was issued against Ranbaxy's Mohali plant, which resulted in a plunge in stock prices.

An import alert is issued when the FDA thinks a company's products present safety problems for US citizens.

Ranbaxy, which is 63.5 per cent-owned by Japan's Daiichi Sankyo Co, gets more than 40 per cent of its sales from the US.