Sun Pharmaceutical Industries Ltd., India's largest drugmaker by sales, said on Monday its fiscal 2016 revenue might decline or stay flat due to costs related to fixing manufacturing issues at Ranbaxy Laboratories, which it bought for $3.2 billion last year.
The company, the world's fifth-biggest generic drugmaker, said its profit could be hurt due to "certain expenses/charges arising out of integration as well as remedial actions."
All of Ranbaxy's India-based drug production sites are banned from exporting to its largest market, the United States, after the U.S. Food and Drug Administration found violations of standard manufacturing practices there.
Sun Pharma, controlled by billionaire Dilip Shanghvi, said in a statement said the remedial actions at Ranbaxy's India plants were "on track," and it would "try to expedite the resolution for at least one of these facilities." It did not give a timeline.
The synergy benefits from the Ranbaxy deal would be 15 to 20 percent more than the company's original target of $250 million by 2018, the company said. It might also get out of certain non-strategic businesses as part of the assimilation.
Sun bought Ranbaxy in April 2014 from Daiichi Sankyo Co., after the Tokyo-based company had to take writedowns on the Indian drugmaker.
(With agency inputs)
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