Sankyo Writes Off Ranbaxy Buy

Japanese drugmaker Daiichi Sankyo will take a write-off of $3.85 billion following its acquisition of Ranbaxy Laboratories, one of India's leading manufacturers of generic pharmaceuticals. Sankyo announced its intention to buy most of Ranbaxy last summer. FDA subsequently banned many of the products Ranbaxy makes in India because of noncompliance with current Good Manufacturing Practices. However, Sankyo claims the hefty write-off is based on "unprecedented turmoil in equities markets." It still considers the acquisition an essential element of its strategy to become a major supplier of both innovative drugs and generics.