US Court rejects class action suit plea against Ranbaxy

Ranbaxy Laboratories has reasons to cheer as New Jersey court has rejected a class action suit proposal against the company demanding a wider recall of its drug Atorvastatin (generic version of Pfizer's blockbuster drug Lipitor which is a cholesterol-lowering medication), reports CNBC-TV18's Ekta Batra.

Ranbaxy had recalled 41 lots of the generic Lipitor after it found glass particles in the drug in November. However, the recall was only made at pharmacy level and not at retail or consumer level. The lawsuit had argued that Ranbaxy should have taken the initiative to alert consumers directly and promptly and it also needed to provide instructions on how to respond to the recall and information on obtaining a refund.
Ranbaxy has escaped the wider recall of the generic Lipitor, on rejections of this lawsuit. However, it is important to note that post the controversy the market share of Ranbaxy in Atorvastatin (or generic Lipitor) has crashed all the way to 1 percent as opposed to peak of  45 percent and is not expected to come back to that levels anytime soon. It may manage to get back around 15-16 percent maximum. 
Also read Ranbaxy Labs can go upto Rs 430-440: Parag Doctor
Ranbaxy had stopped production of generic Lipitor across facilities after the controversy. However it resumed the production of the drug from its Ohm Laboratories facility in New Brunswick, New Jersey, from February 22 post an approval after US Food and Drug Administration. The company is still awaiting approval from the US regulator to resume manufacturing of the drug from its Mohali facility in India.
The recall was only for the US market and not other markets across the world. Ranbaxy was the first to market the generic version of Lipitor in late 2011 after US drug giant Pfizer lost its US patent protection on 30 November 2011.  Ranbaxy was given rights to 180 days of marketing exclusivity by the FDA for being the first company to file a generic equivalent of the drug. In first six months of launch, the drug had generated sales of nearly $600 million for Ranbaxy.