Indian generics giant Ranbaxy has agreed to pay a $500m fine to settle FDA charges of fraud – covering unsafe practices – at two of its factories.

The fine, the largest ever paid by a generic drug manufacturer in the US, comprises $150m for criminal charges and $350m for civil claims.

The offences relate to documents submitted to the Medicare and Medicaid programmes between 2003 and 2010, which Ranbaxy acknowledges made false claims regarding certain products.

FDA inspectors found that drugs manufactured at two Ranbaxy factories in India did not meet safety requirements.

The generic drugs in question included an acne drug (isotretinoin), an epilepsy and nerve pain drug (gabapentin) and antibiotics including amoxicillin.

Ranbaxy manufactured, distributed and sold these drugs when their strength, purity or quality was not that specified by the product literature or the FDA’s approved formulation.

The company acknowledged that inspections of its factories had found evidence of inadequate product testing and record-keeping, as well as deviations from good manufacturing practice.

It also admitted 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 antibiotics.

In 2008, the FDA banned Ranbaxy from selling about 30 drugs in the US. In 2009, it halted reviews of certain Ranbaxy products.

Ranbaxy’s former owners, the family who founded it, have repudiated what it claims are implicit accusations of corruption levelled at it by the company’s present management.

Dinesh Thakur, Ranbaxy’s former Global Head of Research Information and Portfolio Management, will receive $48.6m of the settlement as a whistleblower.

The largest manufacturer of the generic version of Lipitor has been forced to halt production after glass particles were found in certain batches of tablets.

The US FDA announced that Ranbaxy Pharmaceuticals had ceased production of atorvastatin after fragments the size of sand contaminated the popular generic.

Ranbaxy, a subsidiary of Daiichi Sankyo, said “the probability of an adverse event due to consumption of this product is unlikely but cannot be ruled out.”

More than 40 batches of the generic have now been recalled, although the FDA said it had not received any reports of patients being harmed by the contamination.

The New Jersey-based company (part of India-based Ranbaxy Laboratories) declined to reveal where the contaminated drugs were manufactured or why the problem occurred. However, the FDA said that the company has now stopped making the pill’s active ingredient – which is made in India – until an investigation has been completed.

It is not the first time that the quality of Ranbaxy’s products has come under scrutiny. The company has been working under a US court-ordered consent decree after a number of manufacturing issues were found at sites in America and in India. The decree prevents Ranbaxy from producing any more medication at these sites until it meets US standards.

Ranbaxy became one of the first generic manufacturers of the cholesterol lowering Lipitor when the blockbuster drug lost patent protection in November 2011. It now holds a market share of approximately 43%, according to IMS Health data.

Teva has cancelled its plans to join the already crowded market for atorvastatin, the generic version of Pfizer’s fading blockbuster Lipitor.

The global generics leader will collaborate with Indian companies Ranbaxy and Dr. Reddy’s to promote the cholesterol-lowering drug in the US market, without offering its own version.

The decision, according to Teva, came down to two factors: increasing competition and limited manufacturing capability.

Since Lipitor’s patent expiry in November 2011 (US) and May 2012 (EU), eight companies (including Pfizer) have launched generic versions of atorvastatin.

In addition, the drug was likely to dominate Teva’s manufacturing facilities for active ingredients and pill formulations.

Pfizer has stopped marketing Lipitor where its patent has expired, meaning that the brand’s $13bn annual revenue is up for grabs.

Teva Americas CEO William Marth said: “It’s a tough decision, a hard decision not to launch at this time. That doesn’t mean that sometime in the future we may not launch atorvastatin.”

Referring to the challenge of manufacturing the world’s most widely prescribed drug, he added that the reason for the decision was “when we looked at our product, we only had it in the 30-tablet bottle”.

Ranbaxy has earned $600m from atorvastatin in the US under the company’s 180-day exclusivity period (now expired) as the first generic supplier. Half of that went to Teva by agreement.

Daiichi-Sankyo has agreed a $500m legal settlement with the US Food and Drug Administration (FDA) for manufacturing violations by its Ranbaxy unit.

The Japanese company, which acquired India-based company Ranbaxy at the end of 2008, has halved its net income forecast for this tax year.

The FDA charges include falsification of data to cover up inadequate and potentially dangerous manufacturing controls at two Ranbaxy factories in India making generic drugs.

To help compensate for the company’s income loss, Daiichi’s board of directors have agreed to cut their individual pay for the next six months, with directors losing between 5% and 30% of their salaries.

The settlement is subject to approval by the US District Court for the District of Maryland, but Daiichi expects that it will resolve all civil and criminal charges raised by the FDA.

The FDA investigation into Ranbaxy’s at Ranbaxy’s Dewas and Paonta Sahib plants in India began in September 2008, when the FDA warned the company that ‘serious manufacturing deficiencies’ could be affecting over 30 generic products.

Problems reported included inadequate protection against cross-contamination of drugs; inadequate control records; and inaccurate written records of the cleaning and use of equipment.

Daiichi acquired Ranbaxy in November 2008.

In February 2009 the FDA halted reviews of drugs manufactured at the Paonta Sahib site, commenting that that there was a “pattern of questionable data raising significant questions”.

Ranbaxy has said that it will address the issues raised by the FDA by improving its manufacturing and data management practices.

Arun Sawhney, CEO of Ranbaxy, commented: “While we were disappointed by the conduct that led to the FDA’s investigation, we are proud of the systematic corrective steps we have taken to upgrade and enhance the quality of our business and manufacturing processes.”

AstraZeneca’s drug Crestor (rosuvastatin) is no more effective than rival Lipitor (atorvastatin) in reducing arterial plaques and cholesterol levels, according to a major head-to-head trial funded by AZ.

The SATURN trial confirms the value of using high doses of either drug to prevent strokes and heart attacks.

However, their demonstrated equivalence means that Crestor (whose patent will expire in 2016) may struggle to compete with the cheaper generic version of Lipitor about to be launched by Ranbaxy.

The SATURN (Study of Coronary Atheroma by Intravascular Ultrasound: Effect of Rosuvastatin Versus Atorvastatin) trial tested 1,385 participants in 215 centres over 24 months – the largest such trial ever undertaken.

It confirmed that high doses of Crestor (40mg) and Lipitor (80 mg) successfully reduced levels of arterial plaque – and the frequency of stroke, heart attack and need for angioplasty was reduced by half relative to previous trials with lower doses.

Trial outcomes such as increase in ‘good’ (HLD) cholesterol, reduction in ‘bad’ (LDL) cholesterol and reduction in plaque showed Crestor performing slightly better than Lipitor, but not to a statistically significant degree.

Darwin Labarthe, Professor of Preventive Medicine at Northwestern University, commented: “The study provides no basis to infer differential clinical benefit between the two interventions.”

SATURN trial leader Dr. Stephen J. Nicholls said the trial made a strong case for the use of high statin doses: “Regression of plaque has been the holy grail of heart disease treatment, and in this trial more than two-thirds of the patients had regression.

“Doctors have been reluctant to use high doses of statins, but in this study the drugs were safe, well tolerated and had a profound impact on lipid levels, the amount of plaque in vessel walls and the number of cardiovascular events.”

Pfizer is suing Merck to try to block its new Lipitor-plus-Zetia combination drug.

The new pill will be similar to Merck’s Vytorin, combining the company’s own statin drug Zocor (simvastatin) with cholesterol medication Zetia.

Analysts expect a Lipitor/Zetia version to generate $500 million by 2015.

Pfizer has faced generic competition from various angles on its blockbuster cholesterol therapy. The company recently reached a settlement agreement with a number of pharmaceutical companies to delay the launch of generic versions of Lipitor (atorvastatin) in the UK until May 2012.

It has also allowed Ranbaxy Laboratories to sell its generic version of the drug on November 30^th as well as agreeing to supply an authorised generic to Watson Laboratories on the same day.

However, Pfizer still has some patents on Lipitor that aren’t due to expire for a few years, and is citing one of these in its case against Merck.

The company has stated the patent covering Lipitor's crystalline structure, which is due to expire in 2017, but Merck claims that its Lipitor-plus-Zetia pill won't infringe on the patent.

The lawsuit triggers a 30-month regulatory delay, during which time efficacy questions about Vytorin will be asked. A previous study has found no significant difference in arterial narrowing with Vytorin than with Zocor use alone.

A new study is due in 2013, and if the clinical data works against Vytorin, then a Lipitor/Zetia combo may not be as successful in the market as expected.

AstraZeneca’s Crestor has not proved as effective as Pfizer’s Lipitor at preventing cholesterol build-up in one of the arteries leading to the heart, a new study has found.

The SATURN trial’s results came as a surprise after a previous study demonstrated Crestor reversed the build-up of artery plaque, but this reduction did not reach statistical significance.

The “top-line results are not the slam dunk AstraZeneca might have been hoping for,” said Mike Mitchell, an analyst at Seymour Pierce.

The new data leads to the possibility that doctors currently prescribing Crestor will switch to a generic version of Lipitor when it becomes available.

The 104-week SATURN (Study of Coronary, Atheroma by InTravascular Ultrasound: Effect of Rosuvastatin Versus AtorvastatiN) trial involved 1,300 patients, comparing a 40mg dose of Crestor against an 80mg dose of Lipitor.

Meanwhile, Pfizer’s legal battle with generics manufacturer Ranbaxy has ended with Ranbaxy now free to start selling the generic atorvastatin in November 2011.

Ian Read, President of Pfizer, said the deal with Ranbaxy was “a win-win-win because it is pro-patient, pro-competition and pro-intellectual property”.

Sanofi is set to launch a generic version of Pfizer’s anti-cholesterol drug Lipitor (atorvastatin calcium), according to reports in France.

Newspaper Les Echos cites two other sources that Sanofi is planning a generic alternative of Lipitor before its full European patent protection is lost in May next year.

The agreement would be part of the France’s Strategic Council of Health Industries (CSIS) programme which offers tax rebates to the company who holds the rights to the original drug if production is based in the country.

Lipitor, one of the world’s best selling drugs, was set to lose patent in November 2011, but received an extra six months of protection in Europe after a launch of a new version for children.

Generic versions are already available in several countries, including Spain, Brazil and Mexico, which has seen sales of the drug drop from $2.81bn in 2010 to $2.59bn in 2011.

Dr Reddy’s Laboratories recently settled a lawsuit with Pfizer regarding its plan to launch a generic version of the drug, following a similar case against Teva Pharmaceutical restricted their manufacture of the drug.

Other generic companies such as Mylan, Ranbaxy Laboratories and Watson Pharmaceuticals are also planning alternative versions in the future.