Medikabazaar Ousts Former CEO Vivek Tiwari from Board After Fraud Reports

Indian B2B medical supplies firm Medikabazaar has formally removed its co-founder and former chief executive Vivek Tiwari from its board of directors after an internal inquiry unearthed his participation in serious fraudulent and detrimental practices.

The action, made in a special resolution moved with the backing of large investors—Rebright Partners, HealthQuad, Ackermans & van Haaren, and Creaegis, who together own 47% equity—was registered in a filing made with the Registrar of Companies. The filing charged Tiwari with financial fraud, mismanagement, and conduct leading to irreparable harm to the company.

Independent Investigation Reveals Misconduct

Consulting companies Uniqus India, Alvarez & Marsal, and law firm Rashmikant & Partners determined that Tiwari had violated his fiduciary responsibilities by gross negligence, misstating financials, and misappropriation of assets. These determinations follow alarm expressed in a July 2024 PwC audit, which noted at least 60% of the company's gross merchandise value had been improperly recognized as revenue, along with several governance issues.

Financial Difficulties and Investor Backlash

Established in 2015, Medikabazaar had raised close to $190 million, including a $65 million Series D in 2022 from Lighthouse India, that valued the company at more than $500 million. Even as it reported revenue of ₹908 crore in FY23, the company reported a net loss of ₹304 crore. After the revelations, investors who had put in Series C funds filed an indemnity claim of ₹278.7 crore for alleged misreporting of finances during the previous rounds.

The company has not yet announced its FY24 financial results.

Restructuring of Leadership Underway

Tiwari had stepped down as CEO in July 2024, but still held a board seat before being ousted. The company in August 2024 named Dinesh Lodha, a healthcare industry veteran, as its new Group CEO. Lodha was upbeat about guiding the company towards stability and said, "The company is at an inflection point, and I see substantial opportunities across the verticals we operate in.

The exit is an important milestone for Medikabazaar as it attempts to rebuild confidence and tighten governance in the face of continued scrutiny.

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