It was a day of victory for the pharmaceutical company Daiichi Sankyo Co. Ltd. as the Delhi High Court enforced an international arbitral award that ordered the Singh Brothers, former Ranbaxy Lab promoters, to pay Rs. 3,500 crores for concealment of wrongdoings when the Japanese company purchased Ranbaxy in 2008.
Soon after Daiichi bought the brothers’ stake in Ranbaxy in 2008, the American Food and Drugs administration (FDA) banned imports of the Indian drug maker. Ranbaxy eventually pleaded guilty to the charges of manufacturing and distributing adulterated medicines and falsification of data brought by the US Department of Justice and reached a $500 million settlement. It is then that Daiichi had initiated arbitration proceedings against the brothers in Singapore for having concealed and misrepresented the nature and severity of the FDA investigation during the 2008 deal.
In May 2016, the arbitral tribunal seated in Singapore ordered the Singh brothers to pay $400 million for the misrepresentation of facts and its subsequent concealment whilst selling their stake in Ranbaxy to Daiichi. The Japanese firm sought enforcement of the Rs. 3,500 crores award before the Delhi High Court, but the Singh brothers resisted enforcement the award arguing that it was not enforceable under Indian law and policy. The Singh brothers had also challenged the award before Singaporean courts. On 31st January 2018, the Delhi Court rejected the challenge of the Singh brothers and enforced the arbitral award.
Religare on the other hand maintains that all the accusations and allegations made against the brothers is completely baseless and is a ploy to tarnish their image.
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