Arbitration says Singh family withheld information about regulatory investigations during Ranbaxy takeover
A Singapore court has ordered the former owners of Indian drugmaker Ranbaxy – Malvinder and Shivinder Singh – to pay around £367 million to settle arbitration with Japan’s Daiichi Sankyo. The award relates to Daiichi’s accusation that the Singhs concealed and misrepresented information regarding US Food and Drug Administration (FDA) and Department of Justice (DoJ) investigations when Daiichi bought 35% stake in Ranbaxy from them in 2008. Daiichi sold its entire stake in Ranbaxy in 2015, when Sun Pharma acquired Ranbaxy for $4 billion.
In 2013, Ranbaxy was fined $500 million (£346 million) in the FDA and DoJ investigation for knowingly selling substandard drugs as a result of manufacturing and regulatory failings. At the same time, Daiichi filed a case with the Singapore International Arbitration Center. The judgment awards Daiichi INR34 billion (£356 million) in damages (including interest), as well as $15 million (£10.5 million) in costs and legal fees. A statement from the Singhs’ new company, RHC holding, suggests they intend to challenge the Singapore order.