GVK BIO in Trouble
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Case Code: BSTR488 Case Length: 10 Pages Period: 2014-2015 Pub Date: 2016 Teaching Note: Not Available |
Price: Rs.500 Organization: GVK BIO Industry: Pharmaceutical Industry Countries: India Themes: Business, Operational Strategy, Management |
Abstract Case Intro 1 Case Intro 2 Excerpts
Introduction
In July 2015, GVK Biosciences Pvt. Ltd (GVK BIO), a leading pharmaceutical research company in India, suffered a major setback when the European Union (EU) suspended the sales and distribution of around 700 generic drugs sold by various global pharma companies for which clinical trials were conducted at the GVK BIO facility in Hyderabad. The EU drug regulator European Medicines Agency (EMA), alleged that GVK BIO had manipulated the clinical trial data of these generic drugs. The business loss India incurred due to the ban, which came into effect on August 21, 2015, was estimated to be around US$1.2 billion. Dismissing media reports that GVK BIO was considering quitting the clinical trials business in part or in total in 2015, the CEO of GVK BIO, Manni Kantipudi, said, "Despite all the evidence/data presented, the European Commission has moved ahead making the EMA recommendation. Even after multiple appeals, a deeper scientific dialogue was not undertaken. We will continue to work with the Government of India and our customers to help resolve this."
GVK BIO, a contract research organization (CRO), provided contract research services to pharmaceutical and biotechnology companies. A part of the GVK Group, GVK BIO provided different services like drug discovery services, clinical development, contract manufacturing, formulations, and informatics. The organization had research facilities in Hyderabad, Gurgaon, and Ahmedabad.
In the wake of the ban by EU, GVK BIO appealed to the Indian Government to resolve the issue. The Government of India set up a panel of experts to look into the matter. The panel found no evidence of data manipulation at the GVK BIO facility. It was reported that an Indian Government delegation visited EU authorities for talks to have the ban on GVK BIO lifted...
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