New York, July 17
The US drug regulator FDA, which has charged Ranbaxy of selling unsafe medicines in the country, has come under the parliamentary scanner and will be probed for its conduct in approving the Indian pharma major's products and other potential violations in the matter.

A Congressional Committee has said that it would examine Ranbaxy's drug approvals in the US and potential violations of manufacturing regulations, a media report said.

Besides, the House Energy and Commerce Committee would also "look at why the FDA continued to approve medicines made by the company and allow shipments into the US while it was questioning Ranbaxy's manufacturing processes," the Star Ledger newspaper reported.

The report said the Committee "wants to find out whether the FDA knowingly allowed unsafe and ineffective medicine to enter the US." The inquiry stems from a federal court filing by the US Department of Justice, where it has been alleged that there have been "a pattern of systematic fraudulent conduct, including submissions by Ranbaxy to the FDA that contain false and fabricated information about stability and bio equivalence of the company's generic medications."

The Justice Department has also cited a failure by Ranbaxy to report in a timely fashion it distributed drugs that did not meet proper specifications, and has accused the company of concealing violations of good manufacturing practice regulations from FDA.

"If these allegations are true, Ranbaxy has imperiled the safety of Americans in a manner similar to the generic drug scandal we uncovered 20 years ago," the Star Ledger report quoted House Energy and Commerce Committee chairman John Dingell as saying.

Earlier yesterday, Ranbaxy said that the current motion filed by the DoJ was "just a motion" seeking additional information and clarification, while asserting its deal with Daiichi Sankyo stands.

"We have been cooperating with them (DoJ) and will continue to do so. In the meantime, our business in the US continues as normal," Ranbaxy CEO and MD Malvinder Singh said.

Reacting to the reports of the Congressional Committee inquiry, Ranbaxy said in a statement it was not aware of any such development.

The company reiterated that all of its plants were CGMP-compliant and produce medicines that meet global norms.— PTI

New Delhi, July 17
A day after Ranbaxy Laboratories accused the corporate rivals for the recent stock slump, the pharma major today said its deal to sell promoters' stake to the Japanese firm Daiichi Sankyo is "binding and final." "Following intense speculation in sections of the media and the stock market, Daiichi Sankyo and Ranbaxy reiterate that the agreement between Daiichi, Ranbaxy and the Singh family, the promoters of Ranbaxy, is binding and final, subject to regulatory approvals," a joint statement issued by the companies said.

Pointing out that both companies are committed to the transaction, the statement said, "Daiichi Sankyo, Ranbaxy and the Singh family stand by the deal and confirm that the terms of the deal remain unchanged. All synergies expected to accrue to the combine, remain intact as before." The said deal would create a complementary business combination that provides sustainable growth by diversification and an enhanced global reach, it added.

Earlier, the board of directors and shareholders of Ranbaxy Laboratories had approved the allotment of over seven crore securities to Japanese drug maker Daiichi Sankyo.

"The share purchase and share subscription agreement have earlier been approved by the boards of directors of both the companies. Coupled with the approval now in place from the shareholders, this clears the decks for the deal to proceed as planned," the statement said.

Last month, Ranbaxy had announced that the promoters have signed a share purchase agreement with Daiichi Sankyo to sell off their entire stake of 34.8 per cent in the company to the Japanese firm for Rs 9,576.14 crore. — PTI 

New Delhi, July 17
Failing to bring his younger brother and ADAG chairman Anil Ambani on the conciliation table, Reliance Industries (RIL) chairman Mukesh Ambani today started arbitration process against RCom to claim its first right of refusal for the shares of RCom.

Saying that, "RCom has refused to participate in the conciliation meetings under the alternate dispute resolution provisions contained in the Non-Competition Agreement,” RIL said it was nominating Justice B.P. Jeevan Reddy as arbitrator for disputes.

RIL has been stressing that it would be pressing for a resolution of the issue of the “right to first refusal” of the RCom shares through arbitration as provided in the non-compete agreement.

RCom has been in talks with the South African telecom giant MTN for a takeover either through share swap or a complete buyout and have been locked in exclusive merger negotiations since May 26 last.

In a statement, that almost coincided with RCom's charge that RIL issued a fourth letter threatening legal action on MTN discussions, the Mukesh group's flagship company said, “RIL has commenced arbitration proceedings by nominating Justice B P Jeevan Reddy, a former judge of the Supreme Court of India as an arbitrator for the resolution of the disputes".

RCom spokesperson, on the other hand, said "RIL's notice for arbitration proceedings is legally and factually unwarranted".

In the latest round of the spat between the two brothers, following the launching of arbitration process by Mukesh Ambani, the RCom spokesperson accused the elder Ambani's group of ‘successfully destroying’ India's image in foreign eyes and said RIL's malafide design to derail discussions with MTN has been clearly exposed. 

Mumbai, July 17
The Reserve Bank may go for another set of rate hikes in its quarterly review, to be announced on July 29, on back of soaring inflation, primarily fuelled by costly crude and commodity prices, rating agency Crisil said today.

"I expect a further hike in the repo rate and CRR on July 29...given present conditions, we see the GDP growth this fiscal at 7.8 per cent," Crisil's managing director & CEO, Roopa Kudva told reporters here.

He added that while higher interest rates have already hurt the profitability of small and medium-sized corporates, companies have not shelved their investment plans despite a visible liquidity crunch.

In order to check inflation, which is inching towards a 13-year peak of 12 per cent, RBI had effected a series of hikes in its key rates the repo (short-term lending rate) now at 8.5 per cent and Cash Reserve Ratio (the mandatory fund that banks must to keep with the apex lender) at 8.75 per cent), thus forcing banks to jack-up their lending rates.

A high-interest rate regime coupled with economic slow- down are likely to push-up the retail bad loans of Indian banks in the coming months, Kudava added.

"We have seen retail NPAs at 2.4 per cent so far but this may go up to 4-4.1 per cent on account of higher interest rates and increased exposure to high-risk customers," she said.

Steps taken both on the monetary and fiscal side to contain inflation may help to cool it by the fourth quarter FY 09, he said, adding, "the average inflation rate is likely to be 8.5-9 per cent in FY 09." — PTI 

Madrid, July 17
Keen on reaching out to a larger number of rural customers, Aviva Life Insurance is planning to forge liaisons for micro-insurance with financial institutions across various states, including Punjab.

The company was working towards providing new and integrated products to cater to specific needs of low-income segments and also have a paperless policy enforcement in rural areas, said Monica Agrawal, director corporate initiatives, Aviva, on the concluding day of the Aviva Insurance Summit here today.

With an untapped potential of almost $2 billion, rural India provides immense commercial opportunity to insurers, said Agrawal. “We are working with self-help groups and various micro-finance institutions like BASIX and Arohan in 12 states. The focus now, apart from building new products, is on process initiatives."

She said products like credit plus, that were linked with loans, and gramin suraksha that offered a premium as little as Rs 110 were helping the company increase its penetration in the rural segment.

Amid challenges like absence of a proper banking infrastructure, Aviva, through its partners was involving local people to increase awareness.

An increasing number of customers in urban areas were approaching insurance companies through channels like mobile phones and the Internet, said Abhay Johorey, director, transformation and services. He said the proportion of those using mobile phones was much higher than the ones who opted for the Internet.

"There are issues like reducing the time gap to reach customers once they contact the company using a phone or the Internet and also having systems that can deal with the changing technologies in mobile phones so as to gain the maximum through these channels," he added.

Johorey said insurance players had covered barely 2 per cent of the population that could be tapped.

Chandigarh, July 17
Liquor major Diageo India plans to organise exclusive dinners with its celebrity brand advisers, polo matches and a new retail concept as it rolls out its high-end category of spirits across the country.

The group is planning to spend 90 per cent of its budget for these luxury brands on creating a brand awareness for its spirits. Doing away with the concept of brand ambassadors, the group, having over 60 per cent market share, has appointed top-notch celebrities as its brand advisers, who will create an awareness about its brands like Blue Label King George V and Talisker. Dinners for the niche segment are also being planned, along with a scotch-tasting session as part of the brand promotion.

Talking to TNS here today, Santosh Kanekar, director, marketing, Diageo India, said given the exceptional nature of Blue Label King George V (KGV), the branding was being given special emphasis. He was in town to launch the Johnnie Walker Blue Label and the Johnnie Walker Blue Label King George V edition in Punjab. “With the highest number of Mercedes being sold in Ludhiana, and luxury brands like Louis Vuitton recording its highest sales from Punjab, we chose to launch these exclusive spirit in Ludhiana and Chandigarh, after Mumbai, Delhi and Bangalore,” he said, adding that these would also be launched in Jalandhar and Amritsar later.

Considering the exorbitant price of KGV, the company will be retailing these only through select vends and department stores.“We have rolled out our new retail concept, wherein stand alone stores having touch screens and an interactive voice response system, will be selling our premium scotch and single malt brands. Besides, we are expecting sales from the star properties (star hotels) to pick up after the government had fixed a ceiling of 400 per cent as margin on the retail price of these branded spirits,” added Kanekar. 

New Delhi, July 17
The Gujarat government-owned Gujrat State Petroleum Corporation (GSPC) has stated that it would not come with an initial public offering (IPO) as was announced earlier, and instead would raise Rs 4,000 crore through domestic and foreign institutional investors. GSPC plans to invest the money in development of the Deendayal field in KG basin where the gas had been struck yesterday, over the next three to four years. The Krishna Godavari basin fields are estimated to produce 1.38 trillion cubic feet of natural gas.

Addressing mediapersons through video-conferencing from KG-22 well, where the new gas field was struck, Gujarat Chief Minister Narendra Modi said while the government was awaiting certification from the Director-General for Hydrocarbons (DGH) to quantify the discovery, it was estimated that reserve was more than 20 tcf.

The estimate was based on the drilling reports, test results analysed by the GSPC and the feedback received from various independent consultants abroad, he added.
Of the 10 wells drilled so far, the GSPC has struck gas in six wells of the block. The discovery in KG-22 is believed to be the biggest till date.

BRIEFLY

Rupee appreciates further
Mumbai: The Indian rupee on Thursday appreciated further by 17 paise to 42.90/91 against the US currency on the back of smart recovery in equity markets and lack of any dollar buying by oil refiners, despite capital outflows. In quiet trade at the Interbank Foreign Exchange (Forex) market, the local unit resumed higher at 42.93/95 a dollar from overnight close of 43.07/08 and improved further to quote at 42.90/91 per dollar in late morning deals.— PTI

Lehman Brothers’ buyout
NEW DELHI: Unitech a leading real estate developer, said on Thursday it has allotted 50 per cent stake in the intial phase of the Western Express Highway in Mumbai to Lehman Brothers for Rs 740 crore. The project is being jointly developed by Unitech and its local Mumbai partners. — UNI

Gold, silver fall
MUMBAI: Value of silver and gold fell on Thursday as silver easing by Rs 45 per kg to open at Rs 25,845, while gold by Rs 180 per 10 gm, to open at Rs 13,380, from its previous close, on lower buying support from jewelers, traders at the Bombay Bullion Association said. In the domestic market negative trend was witnessed but in international market gold remained steady while silver slightly improved. — UNI

JetLite CEO quits
MUMBAI: Jet's low-cost subsidiary carrier JetLite chief executive officer Maunu von Lueders, has put in his papers. Lueders, who was appointed as the CEO on April 5 this year, has resigned from his post some time back. However, the resignation has not been approved yet. “I have been discussing the issue with the management for quite some time. I have completed my assignment,” Lueders told PTI here today. — PTI

Pizza Hut’s makeover plan
MUMBAI: Following the brand's global re-imaging exercise, the country's chain of Pizza Hut-providers of casual dining space, will undergo a Rs 50-crore makeover over the next three years. “We have always been wrongly compared and pitted against other pizza delivery chains or quick service restaurants, which we are not a part of. The makeover will distinctly position us in the casual dining segment and reinforce our leadership in the segment,” said Yum Restaurants (India) MD Niren Chaudhary. Yum owns the chain. — UNI

McNally bags Rs 246-cr order
MUMBAI: Engineering firm McNally Bharat Engineering on Thursday said the company has received Rs 246 crore order from Vedanta Alumina for commissioning three plants in Orissa. The scope of the order include design, detailed engineering, manufacturing and supply of equipment, erection and commissioning of three 35 tonnes per hour each of plant at Jharsuguda in Orissa, the company said in a filing to BSE. — PTI