U.S. Bans Import of Ranbaxy Drugs From Indian Plant

Citing concerns about drug quality, the Food and Drug Administration on Monday announced a ban on imports of any products made at the generic drug maker Ranbaxy’s newest factory in India.

The move is the third time Ranbaxy imports have been blocked in the United States since 2008.

The factory in Mohali, in the Punjab region of India, is not currently producing any products sold in the United States, according to the Food and Drug Administration.

But the recently renovated facility was to be the centerpiece of Ranbaxy’s comeback from years of major manufacturing lapses, so the news that it, too, would now be prohibited from making drugs destined for the United States sent investors fleeing on Monday.

Ranbaxy’s stock fell by 30 percent, to 318.5 rupees ($4.99), in Mumbai on Monday and financial analysts predicted the development could slow the introduction of several products, including the generic version of the best-selling blood pressure drug Diovan, which has already been delayed for a year. Ranbaxy is a subsidiary of the Japanese pharmaceutical company Daiichi Sankyo.

The F.D.A. said it decided to issue the ban after agency inspectors uncovered significant manufacturing violations at the Mohali facility in September and December of last year. It said the company would be required to hire an outside expert to inspect the Mohali factory and certify that it met the agency’s standards before the restrictions were lifted.

A spokesman for Ranbaxy declined to comment on Monday. Ranbaxy officials have said they are awaiting further details from the F.D.A.

Ranbaxy has been operating under a federal consent decree with the F.D.A. since last year. In May, the company pleaded guilty to federal drug safety violations as part of a $500 million settlement that was the largest in history involving a generic manufacturer and drug safety. As part of the settlement, Ranbaxy admitted that it had failed to conduct proper safety and quality tests of drugs made at its Indian plants. Two other Ranbaxy plants have been operating under an import ban since 2008.

In spring 2012, Ranbaxy began exporting generic Lipitor to the United States that was manufactured at Mohali, a facility the company said in a news release at the time was “equipped with the latest state-of-the-art technology.” But late last year, the company halted all production of generic Lipitor after tiny pieces of glass were found in the tablets. When sales resumed in March, the drug was being manufactured at the company’s Ohm Laboratories facility in New Jersey.

Despite the Lipitor setback, some investors had held out hope that the company would make a comeback by selling exclusive copies of best-selling drugs, many of them manufactured at the Mohali facility.

Several analysts speculated that the F.D.A’s action could further delay the debut of generic Diovan, a hypertension drug by Novartis that lost its patent protection one year ago. Ranbaxy has the exclusive right to sell the generic version of the drug for six months, but the F.D.A. has not given final approval. A competing generic company, Mylan, unsuccessfully sued the F.D.A. last year to force the agency to revoke Ranbaxy’s exclusive rights.

Ranbaxy and the F.D.A. have not said where generic Diovan would be manufactured, but the analysts Nitin Agarwal and Param Desai of IDFC Securities in India said in a note Monday that the ban on the Mohali plant was likely to put further pressure on Ohm Laboratories, which they said was now Ranbaxy’s only manufacturing plant selling products to the United States market. “The facility is already running at full capacity,” they wrote in the note, in which they also downgraded the stock to underperform. “The alert on Mohali facility will hurt future approvals.”

VW and Its Workers Explore a Union at a Tennessee Plant

The company would be the first German automaker to have such a council at a United States plant. A works council is a group of employees, including both white- and blue-collar workers, that meets with management on issues like working conditions and productivity.

But to avoid violating American labor laws, the plant would first have to be formally unionized, the company said.

“VW workers in Chattanooga have the unique opportunity to introduce this new model of labor relations to the United States, in partnership with the U.A.W.,” the union’s president, Bob King, said in a statement on Friday.

Volkswagen officials told employees at the Chattanooga plant on Thursday that it was negotiating with the union about establishing a works council there, where about 2,000 workers assemble the VW Passat. A letter, signed by the plant’s chairman, Frank Fischer, and its vice president for human resources, Sebastian Patta, said the talks were aimed at “the possibility of implementing an innovative model of employee representation for all employees.”

The VW officials said that a works council could be created at a company in the United States only with the cooperation of a labor union because it might otherwise be viewed as an illegal company-sponsored union. That, the VW officials wrote, is why the company has started its dialogue with the U.A.W. None of the foreign carmakers with auto plants in the South are currently unionized.

Gov. Bill Haslam of Tennessee has been outspoken in opposing any union inroads at the Volkswagen plant, warning that it would undermine his state’s efforts to attract investment.

Volkswagen and U.A.W. officials met on Aug. 30 in Wolfsburg, Germany, where the company is based, to continue previous discussions about the works council and unionizing at the Chattanooga plant, which has been operating since 2011 and has a total of 2,500 employees including managers.

Some labor and auto experts say that if the VW plant in Chattanooga gets a works council, it would create pressure to do likewise at the BMW plant in Spartanburg, S.C., and the Mercedes-Benz plant in Vance, Ala.

While some executives see works councils as a pesky thorn in their side, others see them as a useful source of ideas from the shop floor and a vehicle to build consensus and employee morale.

“Volkswagen is a company that has extensive experience with union representation,” Mr. King said in his statement, “and the U.A.W. believes the role of the union in the 21st century is to create an environment where both the company and workers succeed.”

U.A.W. officials say that Volkswagen has agreed to not oppose any unionization drive in Chattanooga.

In the letter to Chattanooga employees, Mr. Fischer and Mr. Patta wrote that they wanted to “prevent any influence from outside driving a wedge into our great team.”

That resembles language that anti-union companies often use to suggest that unions would be an undesirable third party that gets between employees and managers. But a U.A.W. official said that sentence referred to anti-union groups, like the Competitive Enterprise Institute and its Center for Economic Freedom, that have vigorously criticized Volkswagen for not battling to keep out a union the way that many American companies do.

San Onofre Nuclear Plant in California to Close

The owners of the San Onofre nuclear power plant in Southern California, which has been shut since January 2012, said on Friday that they would close it permanently because of uncertainty over when it could be reopened.

The two reactors at San Onofre had not run since a small amount of radioactive steam escaped from new tubes damaged by vibration and friction. Coming months after the Fukushima Daiichi meltdown in Japan, the event prompted a wave of public opposition and set off a legal and regulatory battle that included Southern California Edison, the Nuclear Regulatory Commission and Mitsubishi Heavy Industries, which manufactured the parts that leaked.

Those parts, called steam generators, cost more than $600 million. In the end, uncertainty over the plant’s fate “was not good for our customers, our investors, or the need to plan for our region’s long-term electricity needs,” said Theodore F. Craver Jr., chief executive of the utility’s parent company, Edison International.

The decision delighted nuclear opponents. “I approach today with a good deal of joy,” said S. David Freeman, who shut down construction on several reactors when he ran the Tennessee Valley Authority, and who ran the Sacramento Municipal Utility District after it retired the Rancho Seco nuclear plant two decades ago.

“I think this is a step in the right direction, another move toward the renewable revolution that is under way in the state of California,” Mr. Freeman said, adding that closing the reactors opens up the market to use the renewable power that will follow. For now, though, the replacement power source is natural gas.

The nuclear industry has had a difficult year as it tries to compete with cheaper, abundant natural gas. San Onofre’s two reactors are the third and fourth reactors to be retired so far this year in the United States.

“It’s no secret that power markets have been radically changed by the development of shale gas,” said John Reed, an investment banker who specializes in nuclear reactors. “That changes the economics of any other power supply option, including nuclear.”

Dominion shut its reactor in Wisconsin in May because of unfavorable economics, and Duke said in February that it would not restart Crystal River 3 because mechanical problems were too expensive to fix.

The loss of San Onofre has already pushed up electricity prices in Southern California, to about $4.15 a megawatt-hour higher than prices in Northern California. Those higher prices are an inducement to developers to build new generation, either natural gas or renewable energy, according to Marie Rinkoski Spangler, an electricity analyst at the Energy Department’s Energy Information Administration.

Ms. Rinkoski Spangler said that since June 2012, California has added slightly more generating capacity than it will lose with the retirement of the reactors, in the wrong places.

“Geography really matters,” she said. “The generation itself is not enough, because of where San Onofre sat” near Los Angeles and San Diego.

At the California Independent System Operator, the company that runs the power grid in most of the state, Steve Berberich, the chief executive, said that most of the replacement power had come from natural gas, and that if California’s goal is to reduce greenhouse gas emissions per kilowatt-hour, “you’re moving in the wrong direction.”

But in the longer term, he said, retiring San Onofre would encourage the replacement of older power plants with newer ones that would produce more electricity with the same amount of fuel. And the newer ones could increase and decrease their output faster, he said, making them useful to balance a system with a lot of wind and solar generation, which is highly variable.

San Onofre 2 and 3 entered commercial operation in August 1983 and April 1984. A third reactor was mothballed in 1992.

Many nuclear plants around the country have won permission from the Nuclear Regulatory Commission to run 20 years beyond their initial 40-year licenses, but in a conference call with reporters, Mr. Craver of Edison International said that the prospects for license renewal were uncertain, following the three meltdowns at the Fukushima Daiichi plant in March 2011, and the demand by regulators for a re-evaluation of San Onofre’s vulnerability to earthquake.

Edison had been seeking to restart one of the units at 70 percent power, a level it thought the steam generators could tolerate, but when plant opponents persuaded a panel of three administrative law judges at the Nuclear Regulatory Commission that this would require a public hearing, the company concluded that the proceedings could stretch to the end of next year or longer. Operation and maintenance expense at the plants, which employ 1,500 people are roughly equal whether it is running or not, he said, and if the plant could not reopen by December, retiring it would be cheaper.

The company has $2.7 billion saved up for decommissioning, which is about 90 percent of what is required, he said. Edison shares ownership with San Diego Gas & Electric, which owns 20 percent, and the city of Riverside, which owns 1.79 percent.

Edison has about $2.1 billion invested in the plant, the fuel and related assets. Division of costs between Edison’s shareholders and ratepayers, its insurers and Mitsubishi Heavy Industries, which supplied the heat exchangers, has not been determined.

As for the plant’s workers, the closure will be felt in the area. “When 1,100 people lose their jobs, there will certainly be an impact,” said Bob Baker, the mayor of the nearby city of San Clemente. “San Onofre changed San Clemente when it opened, and it’s going to change San Clemente now that it’s closing.”

USEC to Shut Uranium-Enrichment Plant in Kentucky

WASHINGTON — The only American-owned plant for enriching uranium, a cold war relic near Paducah, Ky., will be shut down next month, its operator said on Friday. The closing could pose a problem for the American nuclear weapons arsenal over time but is not likely to affect civilian nuclear electric plants.

The plant, opened in 1954 by the Atomic Energy Commission, was becoming uncompetitive in the market for uranium enrichment. The federal government was subsidizing the plant for the last year under a barter deal in which it provided uranium to some of the operator’s customers so they would continue to use the plant. But the Energy Department decided not to extend it.

The plant separates two forms of uranium that exist in nature, chemically identical but differing in their ability to sustain nuclear fission, through a process called enrichment. Paducah uses gaseous diffusion technology, which was developed during World War II to make the bomb that destroyed Hiroshima. Gaseous diffusion uses about 20 times the electricity as centrifuges, the technology that supplanted it.

The announcement was made by USEC, the nuclear operator formerly known as the U.S. Enrichment Corporation, which was spun off from the federal government in 1998. The plant is still owned by the Energy Department, which will face a steep bill for decontaminating it and tearing it down. The roughly 1,000 people who work at the Paducah plant are likely to lose their jobs.

USEC, based in Bethesda, Md., said it had a large inventory of enriched uranium and would continue to import enriched uranium from Russia for sale to American utilities. The Russian program began with uranium from decommissioned nuclear bombs but will soon be using uranium enriched by the Russians for commercial uses. The American market is also supplied by a European-owned centrifuge plant in New Mexico.

Andrea Jennetta, the publisher of Fuel Cycle Week, a trade publication, said, “USEC is almost like a broker, a middleman, now.” But she said the civilian market was well supplied and the source did not make much difference.

The worldwide market for enriching uranium has been weakened, in part, by the shutdown of Japanese reactors after the Fukushima accident in March 2011.

The complication of the Paducah closing, though, is the weapons program. The United States has a large surplus of enriched uranium, but the bombs need another material, tritium, a form of hydrogen and the “h” in “h-bomb.”

The government closed its last reactor for making tritium in 1988, but it is now made in a civilian power reactor owned by the Tennessee Valley Authority. Under international rules, though, that reactor must be powered with uranium enriched in the United States. There is enough American fuel on hand to run the reactor making tritium for years.

The government stopped making highly enriched uranium, used for weapons and the propulsion of submarines and aircraft carriers, years ago. But it does not need more for warheads, and it has a big inventory for submarine use.

USEC has been trying to develop an advanced centrifuge, in Portsmouth, Ohio, at a site formerly used for a gaseous diffusion plant. It has applied twice to the Energy Department for a $2 billion loan guarantee to build the plant, and been sent back to the drawing boards both times by the department because of technical concerns.

Members of Congress with USEC plants in or near their districts have tried to help, but on Friday, the Senate minority leader, Mitch McConnell of Kentucky; Rand Paul, Kentucky’s other senator; and Ed Whitfield, the Republican member of the House from the area, seemed to accept the decision and asked for help from the Energy Department in developing new sources of employment.

USEC has built a pilot-scale enrichment plant, with help from the Energy Department, with the idea that if it cannot work as a commercial product, the government will take it over to maintain a small enrichment capability for national security purposes.

Jeremy T. Derryberry, a spokesman for USEC, said the company had lined up $2 billion in private financing to commercialize the pilot program. But it still needs the government loan to build the project.

Paducah will be shut down over the next month, Mr. Derryberry said.

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Gas Resumes Flowing From Eni's Libya Plant

Eni said it might take several more days to reopen the pipeline, which is the single transmission conduit for Libyan natural gas to Italy and, from there, elsewhere in Europe.

While company executives said the supply impact would be minimal, given Eni’s stored reserves in Italy and other sources of gas, analysts said the turmoil had amplified concerns about the stability of energy production and distribution in North Africa. Energy markets and investors are still nervous after the murderous assault in January by militants on an Algerian gas field run by BP and Statoil of Norway.

“The episode is yet another example of energy firms’ operations in North Africa being disrupted by security problems,” IHS, an energy research firm in London, said Monday in a report. “The collective impact of these disturbances is to further discourage foreign direct investment into the energy sector.”

On Saturday, as fighting between rival Libyan militias became too close for comfort, Eni, the biggest foreign oil and gas player in Libya, shut down its giant Mellitah gas complex on the coast west of Tripoli and evacuated most of its personnel.

The Mellitah complex, which Eni built for an estimated €9 billion, or $12 billion, and opened in 2004, gathers and processes gas from fields in western Libya and then sends it through the Greenstream pipeline, which runs under the Mediterranean and comes ashore in Gela, Sicily.

The gas business is a joint venture with the Libyan national oil company.

Although Greenstream provides about 12 percent of Italy’s gas, Italian consumers are unlikely to notice the temporary shutdown, said Kash Burchett, an analyst at IHS. The stagnant Italian economy has sharply reduced demand for gas; Italy has about one month’s worth of gas in storage; and several other pipelines deliver the fuel from other sources, including Algeria and elsewhere in Europe.

But the shutdown could further set back the troubled economies of Libya and its North Africa neighbors, while dimming prospects for new investment in the region by international oil and gas companies.

Since the fall of Col. Muammar el-Qaddafi in 2011, Libya has been in a state of chaos as rival militias vie for turf and treasure. But until now the armed groups have left Libya’s oil and gas fields alone — or in Eni’s case, have even carefully protected the operations, which keep the country’s lights on and the money flowing in.

“The energy installations have been left out of the instability because there is wide recognition about as to how important they are to the economy,” said Richard Cochrane, a security analyst at IHS.

Why the militias crossed a line this past weekend is not entirely clear. One theory, not denied by Eni, is that the two militias were fighting for the privilege of guarding Libya’s most important oil and gas installation, as well as the economic and political benefits that accrue to whoever has that status.

“Libya is different from Algeria; there is not yet a capacity on the part of the central government to provide security,” said David L. Goldwyn, a former senior energy envoy for the U.S. State Department. As a result, he said, “companies are obliged to secure local security.”

The inability of the Tripoli government to provide security means “the investment climate in Libya has been challenged for some time,” said Mr. Goldwyn, who now heads Global Strategies, a consulting firm in Washington. “You are seeing companies protect existing investments in Libya, but being much more cautious in respect to large-scale” new commitments, he said.

Foreign energy companies with existing operations in North Africa might be hard to uproot. But countries including Libya, Algeria and even Egypt, whose economies depend on the oil and gas industry, are going to have trouble attracting new investments.

In a research note published Monday, Fadel Gheit, an analyst at Oppenheimer, argues that Houston-based Apache, which has built a big, highly profitable oil business in Egypt, would be better off decamping from the land along the Nile where it now obtains 28 percent of its petroleum.

“We are more pessimistic about Egypt's future than in any time in the last two years,” Mr. Gheit wrote. We think Apache “would be better off exiting Egypt by selling its operations and using the proceeds to buy back shares, reduce debt and boost investments elsewhere.”

Apache declined to comment.

Renault to Build Assembly Plant in Algeria

PARIS — Renault will sign a deal with Algeria on Wednesday to build an assembly plant near the city of Oran, giving the French automaker wider access to one of the world’s hottest car markets and a chance to further diversify beyond Europe.

The company will sign the pact, three years in the making, on the first day of a state visit by the French president, François Hollande, a Renault spokeswoman, Rochelle Chimenes, said Tuesday.

That will pave the way for the construction of a factory to build Renault and Dacia cars to serve a market that grew 50 percent in the year through October.

Mr. Hollande is embarking on a two-day visit to smooth France’s tricky relations with Algeria, a petroleum-rich country with about 37 million people. Algeria, administered as a French department in North Africa during the colonial era, won its independence in 1962 after a bloody war. France is nonetheless Algeria’s largest trading partner.

Mr. Hollande, accompanied by a legion of French government and business leaders, is scheduled to meet with his Algerian counterpart, Abdelaziz Bouteflika, and to address a joint session of the country’s Parliament.

Algeria, which is the second-largest car market in Africa, after South Africa, is eager to reduce its dependence on the petroleum sector, which accounts for about one-third of its economy.

But restrictions on foreign investment that were enacted after the financial crisis and a failure to modernize the banking system continue to hold back the country’s economic development, according to the U.S. State Department.

Oliver Masetti, an economist at Deutsche Bank, estimates that, depending on oil prices, the Algerian economy will grow up to 2.6 percent this year and as much as 3.4 percent in 2013 — a modest increase by developing world standards.

Renault controls about 27 percent of the Algerian market, and its sales have soared about 57 percent there this year. Its Clio supermini car is the country’s best-selling model.

In Morocco, Renault opened a factory this year in Tangier to make cars for export to European and Mediterranean markets.

Renault is better diversified globally than its ailing French rival, PSA Peugeot Citroën, thanks in part to its alliance with Nissan Motor.

But it is looking for growth outside the European Union, which is gripped by recession and faces the possibility that austerity measures will mean years of stagnation.

La Tribune, a French financial daily, reported Tuesday that Mr. Hollande would raise with his hosts the possibility that the Algerian government dip into its $200 billion of foreign reserves to take a stake in Peugeot, which is undergoing a painful restructuring to stay afloat. Any such request would probably fall on deaf ears, the newspaper cited an unidentified Algerian official as saying.

Cécile Damide, a spokeswoman for Peugeot, declined to comment.

Sales of new cars in the 27-nation European Union fell 7.6 percent in the first 11 months of 2012 from a year earlier, according to the European Automobile Manufacturers’ Association. Sales declined in every major market except Britain, bringing absolute sales to a level last seen in 1993.

The Algerian government will hold 51 percent of the new factory, with Renault owning the rest, the French daily newspaper Le Figaro reported Tuesday, without identifying its source.

The company declined to comment on the details, but such an arrangement would be consistent with the standard foreign investment contract in Algeria. Le Figaro also said the plant would begin operation in 2014 with annual production of about 25,000 vehicles, which could grow to 75,000.

Uranium Plant Using Laser Technology Wins U.S. Approval

The Nuclear Regulatory Commission issued a license to General Electric-Hitachi Global Laser Enrichment this week to build and operate a uranium enrichment plant near Wilmington, N.C., deploying the laser technology instead of costlier centrifuges.

The approval alarmed some advocates of nuclear weapons control, who say they fear that allowing companies to use the cheaper and easier technology could increase the risk of it falling into the wrong hands.

“We think the approval of the license was done without due consideration of proliferation,” said Edwin S. Lyman of the Union of Concerned Scientists. “We’re already grappling with how to cope with Iran’s nuclear enrichment capability” and the laser technology “could make the problem of global proliferation intractable and uncontrollable.”

G.E.-Hitachi said it had not yet decided whether the project would be profitable enough to begin construction of the $1 billion plant. Part of the evaluation will involve weighing whether markets for enriched uranium will hold for years into the future, said Christopher White, a spokesman for the partnership.

But the company made assurances that its hold on the classified technology was secure.

“The company has worked with the N.R.C., the U.S. Departments of State and Energy and independent nonproliferation experts for several years to ensure the security of this technology and has met — and in many cases exceeded — all regulations pertaining to safeguarding this technology,” G.E.-Hitachi Nuclear Energy said in a statement.

The license, awarded Tuesday, allows G.E.-Hitachi to enrich uranium to 8 percent by weight. Uranium is enriched to 90 percent purity to build atomic bombs.

The United States and five other world powers have imposed sanctions on Iran because it has enriched uranium to 20 percent, a level that could be turned into weapons-grade material much more quickly than power-plant fuel.