Wockhardt's former official settles insider trading case with Sebi

A former official of drug maker Wockhardt on Thursday settled with Sebi a case pertaining to alleged non-disclosure of adverse observations made by the USFDA about the company's manufacturing facility to the exchanges in 2013.

Vijay Khetan, who was the compliance officer of Wockhardt, paid Rs 27.06 lakh towards the settlement charges to the capital markets regulator for the alleged violations of insider trading rules, the Securities and Exchange Board of India (Sebi) said in an order.

The order came after Khetan proposed to settle the pending proceedings through a settlement order.

Sebi, through a show cause notice in September 2022, alleged that Khetan, being the compliance officer of Wockhardt at the relevant point of the time, had failed to ensure disclosure of price sensitive information immediately to stock exchanges. Therefore, he allegedly violated the code of conduct specified under the insider trading rules, as per the show cause notice.

It was also alleged that Wockhardt did not disclose the information related to Form 483 issuance by US Food and Drug Administration (USFDA) to its Waluj factory in Maharashtra to the stock exchanges immediately.

As per the order, the USFDA visited the manufacturing facility during March 18-22, 2013 to inspect the factory and data pertaining to Abbreviated New Drug Application filed by Wockhardt with the regulator for Zoledronic acid injection. The USFDA then issued Form 483 which is regarded as adverse observations on factory facilities.

Pending the instant proceedings, Khetan filed a settlement application and paid Rs 27.06 lakh towards full and final settlement of the alleged default.