"The company has disclosed a cash flow crisis caused by increased competition and margin pressures in its Generics business," said Phi.

"The goodwill impairments announced by Sigma relate to aggressive competition in the Generics market, and Pharmaceuticals Benefit Scheme reforms, which have been known to Sigma for some time."

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Phi confirmed that Slater & Gordon is investigating whether the company have misled shareholders by breaching their obligations of continuous disclosure, and whether it had a "reasonable basis for its September profit guidance".

"We are particularly concerned with whether Sigma's disclosures have been appropriate, both in terms of what has been said to the market and what has not been disclosed, particularly given that $300m in capital was raised in September 2009," he said.