Shares of Dr. Reddy's Labs dropped as an US lawsuit has been filed against the company. The stock plunged as much as 2.9 per cent.

According to an exchange filing, a law firm representing an investor in Dr. Reddy's has filed a class action lawsuit in New Jersey against the company, its CEO and CFO.

Dr. Reddy's says the lawsuit alleges that the company made "materially false and/or misleading statements or omissions" related to its “corporate quality system".

The company adds that it cannot comment on the specific allegations except to state “the asserted claims to be without merit".