Sun Pharma shares plunged over 1.5 per cent on Monday after the pharma major on Saturday informed bourses that the anti-trust division of the US Department of Justice has issued summons to its company's US arm to appear before a grand jury.
Sun Pharma shares plunged over 1.5 per cent on Monday after the pharma major on Saturday informed bourses that the anti-trust division of the US Department of Justice has issued summons to its company’s US arm to appear before a grand jury.
Shares of Sun Pharma settled 1.57 per cent down at Rs 812.50. The scrip opened at Rs 831 and has touched a high and low of Rs 842.05 and Rs 808.55, respectively, in trade. Sensex closed 72 points up at 26725.
“One of the company’s US subsidiaries, Sun Pharmaceuticals Industries Inc (SPII), has received a grand jury subpoena from the United States Department of Justice (DoJ), anti-trust division…,” the company said in a BSE filing.
The DoJ has sought “documents from SPII and its affiliates relating to corporate and employee records, generic pharmaceutical products and pricing, communications with competitors and others regarding sales of generic pharmaceutical products and certain other related matters”.
Although the company did not elaborate on the reasons for the summons, such a grand jury subpoena by the DoJ anti-trust division is usually issued to check anti-competitive practices.
The subpoena comes amid a wider probe by US regulators into the steep hike in prices of generic medicines. According to Phillip Capital, subpoena part of a broader investigation into anti-competitive practices, may not have any major adverse impact on Sun’s overall earnings The borkerage house said, “The US subsidiary’s revenue contributes just 15 per cent and profit share 6 per cent to the company’s consolidated financials.”
(With agency inputs)