Ex Ranbaxy Promoters Arrested: Watch the Story of the Rise & Fall

Former Ranbaxy promoters bothers Malvinder and Shivinder Singh were arrested in relation to a fraud case, having been accused by Religare Finvest of fraud and misappropriation of funds to the tune of Rs. 740 crore. FIT is reposting the story of the rise and fall of Ranbaxy as told in the book A Bottle of Lies: Ranbaxy and The Dark Side of Indian Pharma.

Investigative journalist Katherine Eban’s book A Bottle of Lies: Ranbaxy and The Dark Side of Indian Pharma, is now available in India. The book is a detailed investigation into the rot that afflicts the generic drug industry. It also traces the journey of Indian pharma giant Ranbaxy, and how they allegedly used every trick in the book to fake data and risked lives. Watch the video and read about the book below:

Reporter: Vaishali Sood

Producer and Animator: Puneet Bhatia

Narrator: Saakhi Chadha

Camera: Sumit Badola

What does Mahatma Gandhi have to do with generic drugs? FIT explains.

In 1935, Mahatma Gandhi, met chemist Khwaja Abdul Hamied of Cipla Industries and urged him to bring western drugs at an affordable cost to the masses.

And we got the generic drug industry.

But what was meant to bring cure to millions has become warped in controversy and scandal, argues investigative journalist Katherine Eban in her book ‘Bottle of Lies: The Inside Story of the Generic Drug Boom.’

She traces the rise and fall of one of India’s shining star in the pharma world – Ranbaxy Laboratories.

And the whistleblower, who blew the lid off the shiny façade.

FIT interviewed Dinesh S Thakur, a mild-mannered engineer who took on the behemoth. The following video is based on the book, interview with Mr Thakur, and the FDA reports and newspaper coverage of the saga.

"To me it essentially felt as a company that was running by the seat of the pants. Maybe that’s what happens when organisations grow at a very fast pace without any input controls. " - Dinesh S Thakur, Health activist/Whistleblower in the Ranbaxy case

Also Read: ‘Bottle of Lies’: Book on Generic Drugs ‘Exposes’ Indian Companies

The HIV/AIDS Crisis and the Generic Drug Boom

PEPFAR was launched with an aim to bring low cost antiretroviral drugs to African countries.

It was the late 80s. The US Food and Drug Administration had opened the gates for generic drug makers to enter American soil. Ranbaxy was the first Indian company to get a shoe in.

Till then ‘Big Pharma’ that made innovative drugs ruled the market. They had patents and they controlled the cost. Generic drugs were essentially copies of those patented drugs.

Also in the 90s, Africa was in the midst of a massive HIV/AIDS crisis. Over 30 million people were living with the disease.

In January 2003, the United States, under President George W Bush, introduced the PEPFAR programme. (President’s Emergency Programme for AIDS Relief)

Under PEPFAR generic drug makers would make low-cost antiretroviral drugs that the US govt would buy and distribute to poor countries, specially Africa.

Ranbaxy, along with a bunch of other generic drug makers, was a beneficiary.

The patented antiretroviral drugs cost an HIV patient $12,000 a year. Generic drug makers would make it at $350.

The Fraud

In 2003, Dinesh Thakur, a US based engineer had joined Ranbaxy.

A year into his job, he came across a terrible truth.

He alleged, Ranbaxy, in its rush to introduce generic drugs to the markets, was blatantly falsifying data. Data that proved their drugs were safe and therapeutic.

The book claims, one of the ways that Ranbaxy was manipulating data was essentially taking patented drugs, breaking them down, and passing off the results as their own. Results they could not replicate themselves. It was like they had the ingredients but didn't know the recipe.

"When you work in this industry, you take it for granted that at the end of the day, while every business exists to make profits, specially in the healthcare industry you are doing something for the benefit of patients. And when I found out that what we were shipping, not only to the PEPFAR programme, which was the primary purchaser of AIDS drugs, that the US govt was buying from a group of Indian companies to be distributed in Africa where there was this AIDS epidemic,majority of what we were selling wasn’t even therapeutic, it came as a big shock.  " - Dinesh S Thakur

According to the book, in August 18, 2004, Dinesh’s supervisor asked him to prepare a document to map the various drugs being sold by Ranbaxy across the world and to verify whether the claims being made by the company to various regulators matched actual data.

The document was called Self-Assessment Report or SAR. It covered over 120 drugs being sold across 40 countries. The lies were not limited to AIDS drugs. The rot ran deep.

"He made the presentation to the board, and as the book narrates, there were a lot of shenanigans, like asking the company secretary to walk out, the minutes were destroyed, the meeting was essentially wiped out. And there were stalwarts of Indian  industry in Ranbaxy at that time, people from politics, illustrious ex CEOs who talk about the dharma of Indian business were on the board. It’s hard for me to understand how all of these illustrious titans would allow something like this to happen? " - Dinesh S ThakurThe Email That Set Off the Investigations

The FDA investigations into fraud at Ranbaxy lasted nearly 8 years.

Dinesh quit Ranbaxy in April 2005 and in August sent off emails to USAID, the World Helath Organisation and the US Food and Drug Administration. He created an email id in the name of Malvinder Singh – the promoter CEO of Ranbaxy. His identity came to be known as Mr M at the FDA.

Those emails set off a series of investigations that would last eight years..

In the meantime, the FDA would continue to clear Ranbaxy applications for newer drugs.

"The intent at that point of time was to try and tell somebody that this is what was happening. With the expectation that somebody would do something about this. It was very frustrating, it was very disheartening. It’s never an easy thing to go through for anybody. When you know what the reality is, but you get to see all these events unfold in front of your eyes which are contrary to what you know to be true." - Dinesh S ThakurThe Fallout

In 2008, Ranbaxy was sold by the promoter family to the Japanese drugmaker Daiichi Sankyo, allegedly, willfully hiding the ongoing FDA investigations against them.

In 2013, almost 8 years since Thakur first sent that email, Daiichi Sankyo owned Ranbaxy was asked to pay $ 500 million to FDA for selling adulterated drugs with intent to defraud . This was the largest ever fine against a generic drug maker.

In 2013, the Japanese pharma major sued Ranbaxy promoters in Singapore for failing to reveal the FDA investigations during the sale.

The Singh brothers lost the case in Singapore Arbitration Tribunal.

"Our industry in India has really invested a lot of money in upgrading facilities, training people, cleaning up the act, but the beneficiary of those processes are primarily patients from the West. We make export quality product for selling in the US and Europe, and we make another quality product for selling locally. What I am saying is that we need to look at the Drugs and Cosmetics Act and see what needs to change. We are going to be next year 75 years of Independence. Why do we have to live with the pre independence era act? " - Dinesh S Thakur

The fallout is still being felt across the generic drug industry.

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