Dr. Reddy's Laboratories has received official communication from the U.S. Securities and Exchange Commission concluding a multi-year investigation into allegations of improper payments to healthcare professionals without recommending enforcement action against the pharmaceutical company.

Investigation Background and Timeline

The investigation originated from an anonymous complaint received in November 2020, which alleged improper payments to healthcare professionals in Ukraine and potentially other countries. These allegations raised concerns about potential violations of U.S. anti-corruption laws, including the U.S. Foreign Corrupt Practices Act.

Following the complaint, Dr. Reddy's Laboratories took immediate action by engaging a U.S. law firm to conduct a detailed investigation under the directions of the company's Board of Directors committee. The matter was promptly disclosed to multiple regulatory authorities including the U.S. Department of Justice, Securities and Exchange Commission, and Securities Exchange Board of India.

Company Cooperation and Response

Throughout the investigation period, Dr. Reddy's Laboratories maintained full cooperation with all relevant authorities. The company provided requested documents and information to the SEC and DOJ through various submissions and presentations relating to both the initial complaint and additional complaints concerning certain other markets that emerged during the investigation process.

The pharmaceutical company had previously acknowledged in its quarterly financial results and audited financial statements that such investigations could potentially result in government or regulatory enforcement actions in the United States and foreign jurisdictions, with possible civil and criminal sanctions under applicable laws.

SEC Conclusion and Official Communication

On February 23, 2026, Dr. Reddy's Laboratories received the conclusive letter from the SEC regarding the investigation. The communication represents a significant development in the case that has been ongoing for over five years.

The SEC letter specifically stated that based on the information available to it, the commission has concluded the investigation and does not intend to recommend any enforcement action against the company at this time. However, the communication includes standard regulatory language noting that such notice should not be construed as an indication that the party has been exonerated or that no action may ultimately result from the staff's investigation.

Regulatory Compliance and Disclosure

The announcement was made under Regulation 30 of the SEBI Listing Obligations and Disclosure Requirements Regulations, 2015, demonstrating the company's commitment to transparent communication with stakeholders and regulatory compliance across multiple jurisdictions where its securities are traded.

Dr. Reddy's Laboratories Limited has completed the allotment of 12,665 equity shares to eligible employees on February 17, 2026, under its employee stock option programs. The pharmaceutical company issued these fully paid-up shares of Re.1/- each following the exercise of stock options by employees under established compensation schemes.

Stock Option Schemes Details

The share allotment was executed under two distinct employee benefit programs operated by the company. Dr. Reddy's Employees Stock Options Scheme, 2002 and Dr. Reddy's Employees ADR Stock Options Scheme, 2007 facilitated this employee participation in company ownership. Both schemes were originally established under the erstwhile SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 and now comply with current SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021.

Exercise Price Structure

The 12,665 shares were exercised at three different price points, reflecting the varying grant dates and market conditions when the options were originally awarded to employees:

Share Capital Impact

Following this allotment, Dr. Reddy's Laboratories' equity structure has been updated to reflect the additional shares in circulation. The company's total issued shares now stand at 83,46,44,020, with the total issued share capital reaching Rs. 83,46,44,020/-. The newly allotted shares carry distinctive numbers ranging from 834630356 to 834643020 and are issued under ISIN INE089A01031.

Regulatory Compliance

The share allotment was conducted in full compliance with regulatory requirements under Regulation 30 of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015. The newly issued equity shares rank pari passu with existing shares, ensuring identical rights and privileges for all shareholders. No lock-in restrictions apply to these shares, and they are immediately tradeable on the stock exchanges where Dr. Reddy's Laboratories is listed, including BSE Limited, National Stock Exchange of India Limited, New York Stock Exchange Inc., and NSE IFSC Limited.