Biocon Shares Gain Amid Bribery Allegations Against Subsidiary

Shares of Biocon Ltd. gained most in nearly two weeks after the company denied allegations of bribery in drug approval process.

The denial came after the PTI reported, citing officials, that the Central Bureau of Investigation apprehended Joint Drugs Controller S Eswara Reddy for allegedly receiving Rs 4-lakh bribe. It was part of the payout to allegedly waive phase-three clinical trial of Insulin Aspart injection, an underdevelopment product of Biocon Biologics, PTI reported quoting CBI officials.

"We deny the bribery allegations made in certain media stories. All our product approvals are legitimate and backed by science and clinical data. Our bAspart is approved in Europe and many other countries. We follow due regulatory process for all our product approvals by DCGI. The entire application process in India is online and all meeting minutes are in public domain. We are co-operating with the investigation agency," Biocon Biologics said in a statement.

The CBI registered a case of criminal conspiracy and corruption against Reddy and Dinesh Dua, director at Synergy Network India, among others, PTI reported.

The CBI has alleged that the regulatory work of Biocon Biologics was taken care of by Guljit Sethi of Bioinnovat Research. This firm and Synergy Network have business dealings, hence Dua agreed to make the bribe payment, according to the report.

The FIR also names Sethi; L Praveen Kumar, associate vice president and head-national regulatory affairs at Biocon Biologics; and Animesh Kumar, assistant drug inspector CDSCO, the report said.

Shares of Biocon gained 2.82% on Tuesday compared with a 1.88% rise in benchmark Nifty 50. Of the 21 analysts tracking the company, 12 maintain a 'buy', five suggest a 'hold' and four recommend a 'sell'. The overall consensus price of analysts tracked by Bloomberg implies an upside of 25.4%.

(With inputs from PTI)