Shares of Aurobindo Pharma fell over 2 percent after the company received a warning letter from the capital markets regulator Securities Exchange Board of India (SEBI) regarding insufficient disclosures.

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“We have received a warning letter from the SEBI on June 24... The letter is in regards to certain disclosures made by the company on the ongoing USFDA (US Food and Drug Administration) audit of the company's Unit-1 and observations made by the USFDA between 2019 and 2022,” Aurobindo Pharma said, in an exchange filing.

Aurobindo Pharma's Unit-1 is an API (active pharmaceutical ingredients) manufacturing facility in Hyderabad.

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The USFDA has classified the inspection at Aurobindo Pharma's Unit-I between August 2 and 12, 2021, as Official Action Indicated. This indicates a condition noted during the inspection was significant enough to pose an imminent health hazard or was an uncorrected Voluntary Action Indicated condition on a previous inspection.

The SEBI warning letter observes that the pharma company had disclosed very limited and restricted information and that it did not disclose the detailed reasons and also did not consider observations of the USFDA as serious, the filing said.

At 11:13 IST, shares of the company were trading 1.5 percent lower at Rs 513.55 on BSE. The stock is about 2 percent away from its 52-week low of Rs 503.4.

In the past three years, the scrip has been down 15 percent.

The SEBI has advised the company to ensure compliance with all applicable provisions of SEBI Regulations and to place the warning letter before its board of directors in the ensuing board meeting.

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First Published:Jun 28, 2022 11:57 AM IST