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Explained: What is the Biocon bribery case linked to a drug trial waiver bid?

It has even arrested the Associate Vice President of the company, L Praveen Kumar. However, the Kiran Mazumdar Shaw-promoted pharmaceutical firm has denied these allegations.

The CBI last week nabbed the Joint Drug Controller (JDC) with the Central Drugs Standard Control Organization (COSCO), S Eswara Reddy, while accepting a bribe of Rs 4 lakh from a representative of a Delhi-based firm. The probe agency has alleged that the representative was paying the bribe to get some files related to Bengaluru-based Biocon Biologics Ltd cleared by the central regulatory body. It has even arrested the Associate Vice President of the company, L Praveen Kumar. However, the Kiran Mazumdar Shaw-promoted pharmaceutical firm has denied these allegations.

What is the case?

The CBI has alleged that it received information that Dinesh Dua, Director of Delhi-based Synergy Network India Pvt Ltd, was negotiating bribes to waive Phase III trials for Biocon’s Insulin Aspart Injection among other files, and was to visit Reddy’s Chanakyapuri residence on June 20 to deliver part of the negotiated bribe amount of Rs 9 lakh.

The CBI claimed that it laid a trap and arrested both while exchanging a bribe of Rs 4 lakh. It subsequently arrested L Praveen Kumar from Bengaluru; Guljit Sethi alias Guljit Chaudhary, Director of Bioinnovate Research Services Private Limited, Delhi; and, CDSCO Assistant Drug Inspector Animesh Kumar.
According to the CBI FIR, Reddy had three files of Biocon Biologics Ltd pending with him for clearance. Sethi’s company Bioinnovate used to handle regulatory affairs of Biocon along with several pharmaceutical companies and regularly paid bribes to get regulatory clearances, the agency has claimed.

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Bioinnovate had business relations with Dua’s company, Synergy Network, and Dua had been asked by Sethi to allegedly bribe Reddy to waive Phase III trials of Biocon’s Insulin Aspart Injection.

“Sethi …has conspired with Shri L Praveen Kumar, Associate Vice President and Head — National Regulatory Affairs (NRA) and other senior executives of M/s Biocon Biologics Limited, Bangalore to pay a total bribe amount of Rs 9 lakh to Dr S Eswara Reddy for favourably processing the said three files related to M/s Biocon Biologics Limited, Bangalore and also for favourably recommending the file of ‘Insulin Aspart Injection’ to the Subject Expert Committee (SEC) meeting on 18.05.2022,” the CBI FIR has said.

What was the Joint Drug Controller’s role?

According to the CBI, JDC S Eswara Reddy had attended the SEC meeting on May 18 and had supported for waiver of Phase III clinical trial for the “Insulin Aspart Injection” of Biocon. The agency has alleged Reddy manipulated the minutes of the meeting of SEC held on May 18 changing the word “Data” to “Protocol” in the recommendations and “thereby causing substantial wrongful gain to M/s Biocon Biologics Limited”.
According to the CBI, Sethi colluded with Reddy, Animesh Kumar and other unknown officials of CDSCO for including the third file of Biocon for SEC Meeting on June 15. It has alleged Animesh Kumar processed and put up the file for including Biocon’s application in June 6 SEC meeting for which Sethi had paid Rs 30,000 to him as illegal gratification.

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The CBI has further said that Dua met Reddy at CDSCO Office on June 15 in connection with the approval of the third file during the SEC meeting scheduled on the same day and Reddy assured Dua about a favourable decision in the SEC meeting.

How is Biocon’s Praveen Kumar connected?

CBI has alleged it was on Kumar’s directions that the entire bribery operation was carried out. It has claimed that on June 15, Praveen Kumar informed Guljit Sethi that the file of Biocon Biologics Limited had been approved in the SEC Meeting.
The probe agency claims that during his meeting with Dua at CDSO office on that day, Reddy provided his new residential address at Chanakyapuri and asked him to meet there at the end of the week.

“Information also revealed that Shri L Praveen Kumar…has agreed to pay a total of Rs. 9,00,000/- bribe amount as a motive/reward to Dr S Eswara Reddy …to favourably process the files of the company. Guljit Sethi directed Dinesh Dua to deliver the part of the agreed bribe amount on behalf of the company to Dr S Eswara Reddy at his residence,” the CBI FIR has said.

How has Biocon reacted?

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Rejecting the allegations, Kiran Mazumdar-Shaw said, “We deny the bribery allegations. All our product approvals are legitimate and backed by science and clinical data. Our bAspart (insulin injection) is approved in Europe and many other countries. The regulatory process in India is online and all meeting minutes are in public domain.”

A similar statement was issued by the spokesperson of Biocon Biologics who added that the company was cooperating with the investigation agency.

What is the probe status?

Despite being a trap case where a senior official of the government has been caught accepting a bribe red-handed, the courts have not granted CBI the custody of the accused beyond one day. In fact, the lower court refused to give the custody of L Praveen Kumar to CBI even for one day after he was brought to Delhi on a transit remand from Bengaluru. All the accused are in judicial custody currently.
The CBI has now approached the Delhi HC to seek their custody. The HC has issued notices to all concerned and will hear the matter next month.

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First published on: 30-06-2022 at 02:45:29 pm
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