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India's Largest Pharmaceutical Company Reported Two Reports In A Month
Jan 25, 2019

1. Two reports within one month


According to media reports, Sun Pharmaceuticals reported the same person twice, and the first report was that Sun Pharmaceuticals acquired Ranbaxy for insider trading.


In 2015, Sun Pharmaceuticals completed the acquisition of Ranbaxy, worth $4 billion, and the deal also made the former the largest pharmaceutical manufacturer in India. This is also the international strategy of Sun Pharmaceuticals to expand its business landscape through mergers.


Ranbaxy was acquired by the first three in 2008 for $4.6 billion, and the latter hopes to enter the generics market and find new growth points. However, after Lancaster was punitively sanctioned by the FDA for several years due to defects in production and falsification of data, more than 30 drugs produced by two factories were banned from exporting to the US market, and drugs produced by one of the factories were stopped by the FDA. Review, in trouble.


In fact, the days of Sun Pharmaceuticals have not been better in recent years. On the one hand, the FDA's monitoring of approved drugs abroad is becoming more and more strict, especially in Asia, where the pharmaceutical market environment is chaotic and India faces more challenges. On the other hand, with the increase in the number of generic drugs approved by the FDA, it not only brought new competitors to the United States, but also prompted US generic drug purchasers to unite to lower the price of the drug market.


In May of this year, due to the quality risks, the State Food and Drug Administration issued a notice stating that the imipenem cilastatin sodium for injection produced by Indian Sun Pharmaceutical was suspended in China from May 14. At the end of 2017, the FDA also issued a notice saying that due to microbial contamination, Sun Pharmaceuticals voluntarily recalled some products. At the end of 2015, Sun Pharmaceutical's Harold factory also received an FDA warning letter, which is the largest sales company of Sun Pharmaceutical in the United States.


As the helm of Sun Pharmaceuticals, Dilip Shanghvi has climbed the richest throne in India for $22.5 billion. According to Forbes' latest ranking, its personal wealth has shrunk to 7.7 billion US dollars, which also reflects Sun's unsatisfactory past few years.


According to Sun's 2018 Annual Report, its annual revenue was 3.837 billion US dollars, down 15.13% year-on-year, and net profit was 304 million US dollars, down nearly 70% year-on-year.


2, insider trading penalties continue


In fact, cases in which domestic listed companies have been punished for insider trading in recent years have occurred. The CSRC has no dead ends, full coverage, and zero tolerance for the investigation of such behaviors. It is even more severely penalized for the insider trading behavior of the actual controllers of listed companies.


In 2017, Li Tiejun, the secretary of Yisheng Pharmaceutical, was convicted of insider trading for a total of 5.047 million yuan and was fined a total of 15.142 million yuan. At the same time, due to the violation of the letter, Li Tiejun was also given a warning by the Securities and Futures Commission and imposed a fine of 300,000 yuan. In addition, it has been taken for three years in the securities market ban.


According to the data, the fact that Li Tiejun is involved in the insider trading illegality is to use the "vest" account to trade Yisheng Pharmaceutical stock during the sensitive period. The corresponding sensitive periods are from November 20, 2013 to April 1, 2014, and from January 10 to April 9, 2014, involving the restructuring and annual profit distribution of Yisheng Pharmaceutical.


Also in 2017, the China Securities Regulatory Commission announced the penalties for the insider trading case of Hengkang Medical Stock, confiscated the illegal income and imposed a fine, and the total amount of fines and fines exceeded 140 million. It is worth noting that this case is also one of the most insider trading cases in the SFC in recent years. The three parties used the inside information of the knowledge to actually use the nine securities stock accounts. During the inside information sensitive period, they accumulatively bought a total of 546,600 shares of Hengkang Medical Stock, involving a turnover of more than 146 million yuan and an illegal profit of 35.431 million yuan.


Kangmei is undoubtedly the "most sad" pharmaceutical stock this year. Wang Lianjun, the legal person of Bo Yi Investment controlled by Ma Xingtian, was suspected of manipulating the stock price and insider trading was forced to take measures. The target of the manipulation may involve Kangmei Pharmaceutical, which caused the latter’s share price to be “smothered”. Today, the market value is less than 400. 100 million yuan.


At the end of 2018, Wu Guangming stepped down as chairman of Wandong Medical, and his other identity was the actual controller and chairman of Yuyue Medical. Earlier, Yuyue Medical announced that the company received the notice from the actual controller and chairman Wu Guangming, who received the “Administrative Punishment Decision” from the CSRC. The main content of the "Administrative Punishment Decision" is that Wu Guangming's insider trading Kao shares, as well as short-term trading "Fish Leap Medical" and "Wantong Medical" violate the relevant provisions of the Securities Law. The CSRC has made the following administrative penalties: Wu Guangming gave a warning, confiscated the illegal income of 9.19 million yuan, and imposed a fine of 27.7729 million yuan.

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