STOCK CODE

600664

2025

Sustainability Report

HARBIN PHARMACEUTICAL GROUP CO. LTD.Contents

About Special Topic: Empowering with a Digital

About This Report ?? Message from the ?? Hapharm ?? 2025 Key Performance Sustainability

and Intelligent Engine Building a

Chairman in Sustainability ?? Management ??Group Foundation for High-Quality Develop-

??

ment Through Technological Innovation

Governance and Compliance to Product System for Value Creation Green Operations to Advance Employee Development to Build a

01 Solidify a Foundation for Stable 02 03 Low-Carbon Management 04 Safe and Shared FutureGrowth

Party Building Leadership and 23 Technological R&D and Innovation 39 Environmental Compliance 67 Employee Rights and Care 87

Responsibility Implementation Practices Management Talent Cultivation and Develop- 91

Construction of Corporate 26 Technology Ethics 43 Climate Change Tackling 68 ment

Governance System Industrial Cooperation and 44 Energy and Resource Manage- 72 Occupational Health and Safety 95

Internal Control and Compliance 31 Exchange ment Rural Revitalization Practices 101

Management Product Quality and Safety 45 Pollutant Emissions 77 Public Welfare and Social Action 103

Culture of Integrity and Honest 35 Management Waste Management 79

Operations Customer Rights and Interests 51 Ecosystem and Biodiversity 82

and Service Assurance Conservation

Supply Chain Management and 55

Security

Appendix

Information Security and Privacy 59

Key Performance Table 109 Protection

Index of Indicators 113 Medication Accessibility Enhance- 60

Reader Feedback Form 114 ment

Report Assurance Statement 116About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation Management Shared Future

About This Report Time Horizon

This Report covers the period from January 1 2025 to December 31 2025. To enhance the completeness and comparability of

the information some content may be appropriately traced back to previous years or extended beyond the reporting period

Report Explanation where necessary.

2025 Sustainability Report of Hapharm Group (hereinafter referred to as "this Report") is prepared and published by HARBIN Sources

PHARMACEUTICAL GROUP CO. LTD. (hereinafter referred to as "Hapharm Group" "the Company" or "we"). Building on the

Company's social responsibility disclosure efforts this is the first dedicated sustainability report that systematically integrates The data disclosed in this Report is primarily sourced from the Company's internal statistical data business management

and expands upon relevant information under the environmental social and governance (ESG) framework. It provides a focused systems and consolidated information from relevant functional departments. Some data is derived from audited financial

presentation of the Company's management philosophy key initiatives and progress in the field of sustainability for the year reports or third-party professional institutions. The Company adheres to the principles of authenticity accuracy and complete-

2025. This Report aims to facilitate more efficient comprehensive and objective communication and exchange with all stake- ness in data collection and consolidation to ensure the reliability of the information disclosed.

holders regarding the Company's sustainability work.How to Obtain This Report

Materiality This Report is published in electronic format and can be accessed and obtained from the website of the Shanghai Stock

Exchange (www.sse.com.cn) or the official website of Hapharm Group (www.hayao.com).This Report is available in both Chinese

The Company conducted a double materiality assessment on ESG-related topics for 2025 comprehensively identifying and and English versions. In case of any discrepancy between the two versions the Chinese version shall prevail.evaluating the impact of each topic on the Company's financial position stakeholders and the environment and society. For the

specific process and results of the double materiality assessment please refer to the "Double Materiality Analysis" chapter of Definitions

this Report.Quantitative Term Refers to Definition

For all quantitative indicators in this Report their measurement scope statistical methods relevant assumptions and the sourc- Hapharm Group the Company Refers to Harbin Pharmaceutical Group Co. Ltd.es of calculation tools or conversion factors used (if applicable) are explained accordingly to enhance the transparency and Harbin Pharmaceutical Group

the Group Refers to Harbin Pharmaceutical Group Holding Co. Ltd. (HPGC)comprehensibility of the information disclosed.Balance This Report Refers to 2025 Sustainability Report of Hapharm Group

Reporting period this year Refers to The period from January 1 2025 to December 31 2025

This Report strives to reflect the Company's management initiatives and phased achievements in the environmental social and

corporate governance fields in a true fair and comprehensive manner. It aims to avoid improperly influencing the judgment and Hayao General Factory Refers to Harbin Pharmaceutical Group General Factory

decisions of report users through selective disclosure information omission or improper presentation. Hayao No.6 Factory Refers to Harbin Pharmaceutical Group No.6 Pharmaceutical Factory

Consistency Sanchine Refers to Harbin Pharm Group Sanjing Pharmaceutical Co. Ltd.As this is the Company's first sustainability report prepared under the ESG framework the Company will unless otherwise speci- Sanjing Mingshui Refers to Harbin Pharmaceutical Group Sanjing Mingshui Pharmaceutical Co. Ltd.fied or in special circumstances continuously optimize and improve its statistical scope and disclosure methods for sustainabili- Shiyitang Chinese Medicine Refers to Harbin Shiyitang Chinese Medicine Co. Ltd.ty-related information disclosure based on existing disclosures. The Company will maintain relative consistency in disclosure

principles and methods to enhance the continuity and comparability of the information disclosed. Renmintongtai Refers to Harbin Pharmaceutical Group Renmintongtai Pharmaceutical Co. Ltd.Logistics Center Refers to Harbin Pharmaceutical Group Harbin Pharmaceutical Commercial Co. Ltd.Preparation Basis

Pharmaceutical Branch Refers to Pharmaceutical Branch of Hapharm Group Pharmaceutical Co. Ltd.This Report has been prepared in accordance with the Guidelines No. 14 of Shanghai Stock Exchange for Self-Regulation of Second Chinese Medicine Refers to Harbin Pharmaceutical Group Second Chinese Medicine Factory

Listed Companies – Sustainability Report (Trial) issued by the Shanghai Stock Exchange (SSE). It also references the Corporate Factory

Sustainability Disclosure Standards – Basic Standards (Trial) issued by nine departments including the Ministry of Finance of the Marketing Company Refers to Harbin Pharmaceutical Group Marketing Co. Ltd.People's Republic of China the Global Reporting Initiative (GRI) Standards issued by the Global Sustainability Standards Board

GNC China Refers to GNC China is jointly composed of GNC Hong Kong GNC Trading

(GSSB) IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2 Climate-related Food Technology and Harbin Pharmaceutical Hong Kong II

Disclosures issued by the International Sustainability Standards Board (ISSB) the recommendations of the Task Force on GMP Refers to Good Manufacturing Practice

Climate-related Financial Disclosures (TCFD) and the United Nations Sustainable Development Goals (UN SDGs).GSP Refers to Good Supply Practice for Drugs

Reporting Scope GLP Refers to Good Laboratory Practice

RMB ten thousand yuan

hundred million yuan Refers to RMB yuan ten thousand yuan hundred million yuan

In principle this Report covers HARBIN PHARMACEUTICAL GROUP CO. LTD. and its subsidiaries included in the consolidated

financial statements. Where individual indicators do not cover all entities due to statistical scope business nature or data

availability corresponding explanations have been provided in the report.

03 04About This Message About 2025 Key Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in

Sustainability

Management Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability ReportCreation

Chairman Group Sustainability Stable Growth Management Shared Future

Message from the Chairman

Focusing on present development to solidify foundations for long-term growth; looking ahead to drive

transformation and foster momentum through innovation.Over the past year the Company has continued to refine its modern corporate governance system treating compli-

ant operations and risk prevention and control as essential pillars of stable operations. Through a series of institu-

tional arrangements it has continuously enhanced decision-making transparency and management standardiza-

tion. At the same time the Company has steadfastly advanced technological innovation and digital

transformation—from optimizing its R&D system to implementing smart manufacturing practices and from quality

data governance to reengineering management processes—creating synergy between technology and manage-

ment to embed reform outcomes as organizational capabilities and drivers of development. The Company firmly

believes that only by building solid foundations and pursuing deep innovation can an enterprise maintain resilience

amid complex and changing environments and steadily advance toward longer-term development.Upholding quality as the cornerstone to honor its original mission and prioritizing responsibility to

protect health; building trust through dedicated service and demonstrating value through responsible

actions. The pharmaceutical industry carries the public's high expectations for safety and efficacy.The Company continues to strengthen its full-lifecycle quality management and pharmacovigilance systems

shifting risk identification and process controls upstream to the R&D and production stages. Through rigorous

quality process management it ensures that every medicine meets the test of standards and time. Concurrently

the Company continuously enhances customer service capabilities and medication accessibility by providing

professional pharmacy support and developing frontline services to better align health services with societal

needs. For Hapharm quality is not merely a baseline for survival but a solemn commitment to the public and the

fundamental basis for sustained and stable development.HARBIN PHARMACEUTICAL Embracing green trends to promote sustainable development and expanding horizons through syner-

GROUP CO. LTD. gistic collaboration; caring for employees to build collective strength and co-creating an ecosystem

for a shared future.Party Secretary and Chairman

In response to resource and environmental constraints the Company integrates green principles throughout its

production and operations continuously advancing energy conservation consumption reduction and environ-

mental protection to ensure more resilient and responsible development. Meanwhile the Company places great

emphasis on employee development and industrial collaboration fostering talent promoting industry-aca-

demia-research partnerships and engaging in social practices to drive mutual progress among the enterprise its

partners communities and the broader industry. The Company deeply understands that genuine sustainability is

a process in which enterprises and society mutually empower and share outcomes.As times evolve so do health needs; as the industry progresses responsibilities deepen. Looking ahead with steadfast resolve to create long-term value; walking hand-in-hand toward a shared

vision and co-writing a new chapter in health.Standing at a new stage of profound transformation in the pharmaceutical and healthcare sector the Company recognizes with Going forward sustainability will remain a critical benchmark for measuring corporate resilience and governance

increasing clarity that the value of a pharmaceutical enterprise lies not only in its scale and performance but also in its reverence maturity. Hapharm Group will leverage a stronger governance foundation a more determined pace of innovation

for life and health its commitment to social responsibility and its continuous investment in long-term sustainability. Hapharm and a more open approach to responsibility to translate sustainability principles into enduring value creation. The

Group has always upheld safeguarding public health as its founding mission closely integrating high-quality development with Company is committed to advancing alongside all stakeholders aligned in the mission of safeguarding public

social value creation. This year the Company is releasing its sustainability report for the first time under a systematic ESG frame- health ensuring that corporate growth and social progress reinforce each other and jointly crafting a new chapter

work. This represents both a comprehensive review of years of governance practices and developmental achievements and marks of high-quality development for Hapharm's future through accumulated trust and shared value over time.a significant upgrade in Hapharm's development philosophy management systems and expression of responsibility. It reflects the

Company's firm commitment to advancing high-quality development with greater transparency standardization and a long-term

orientation.

05 06About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation Management Shared Future

About Hapharm Group

Company Profile

The Company focuses on the pharmaceutical and healthcare industry primarily engaging in pharmaceutical research and develop- The Company’s pharmaceutical R&D and manufacturing business covers chemical drugs traditional Chinese medicine biologics

ment manufacturing wholesale and retail businesses. It is a large domestic high-tech pharmaceutical enterprise integrating R&D healthcare products medical devices and aesthetic medicine products. Its product portfolio focuses on five major therapeutic

manufacturing and sales. According to the industry classification standards issued by the China Association for Public Companies areas including cardiovascular and cerebrovascular diseases digestive and metabolic systems respiratory systems anti-infec-

the Company belongs to the pharmaceutical manufacturing industry (C27). The Company was listed on the Shanghai Stock tives and anti-tumor treatments with more than 500 products currently in production and on sale. Major products include Zinc

Exchange in June 1993 (Hapharm Group 600664.SH) becoming the first listed company in China’s pharmaceutical industry and Gluconate Oral Solution HAYAO Calcium-Iron-Zinc Oral Liquid Compound Calcium Gluconate Oral Solution Erythropoietin

the first listed company in Heilongjiang Province. Injection Amoxicillin Capsules Shuanghuanglian Oral Liquid Penicillin Sodium for Injection Qufeng Gutong Gel Patch Lacidipine

Tablets and Pediatric Paracetamol Artificial Cow-Bezoar and Chlorphenamine Maleate Granules.During its development the Company has continuously optimized its business structure and integrated resources. In 2015 the

Company reorganized its assets and business segments through asset restructuring establishing a pharmaceutical commercial The Company’s pharmaceutical wholesale and retail business is primarily conducted through its listed subsidiary Renmin Tongtai

listing platform (Renmin Tongtai 600829.SH) and forming a business layout in which pharmaceutical manufacturing and pharma- a well-known regional pharmaceutical distribution enterprise and the largest pharmaceutical commercial company in Heilongjiang

ceutical distribution operate relatively independently while developing in coordination. Province. Renmin Tongtai’s main businesses include pharmaceutical wholesale pharmaceutical retail pharmaceutical logistics

services and medical services. Its operations cover chemical drugs proprietary Chinese medicines and biologics as well as the

sale of medical devices Chinese herbal decoction pieces health foods daily necessities glassware and chemical reagents.

600664.SH

The Company was listed on the first listed company

Shanghai Stock Exchange in June becoming the first listed company in 600829.SH

1993 (stock code: 600664.SH) China's pharmaceutical industry and created Renmintongtai

the first listed company in Heilongji- (stock code: 600829.SH) as

ang Province. its listed platform for

pharmaceutical commercial

Over 500 activities.in-production and

Human Erythropoietin

Injection marketed

specifications Shuanghuanglian Oral Liquid

Compound Calcium Gluconate

Zinc Gluconate Oral Solution Oral Solution

GNC Vitapak Daily Nutrition Pack

Hayao Brand Calcium-Iron-Zinc

Oral Liquid

Lacidipine Tablets

Amoxicillin Capsules

07 08About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Special Topic to Solidify a Foundation for Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability

Management

Stable Growth Creation Management Shared Future

Company Honors 2025 Milestones

Brand and product market recognition

Sanjing Zinc Gluconate Oral Solution (Strawberry Flavor) obtained its

The Oral Liquid No. 1 Workshop of Sanchine and the filing certificate and completed the license expansion. This project

Solid Dosage Form No. 1 Workshop of Hayao No.6 received approval for a health food filing certificate marking the first-ever

Factory were recognized as "Heilongjiang Province approved zinc supplement in sachet format signifying that the Company's

CPHCF Award for Best-Selling West Lake Award for Most Advanced-Level Digital Workshops." R&D capabilities and product quality in the health industry have been

Products in China's Retail Popular Star Single Product 2025 Healthy China highly recognized by authoritative institutions.Sanjing Calcium Gluconate

Pharmaceutical Market in Pharmacies Brand List Calcium Lactate Oral Liquid (Peach Flavor) obtained its filing certificate

Harbin Pharm Group Sanjing Harbin Pharmaceutical Group Harbin Pharm Group Sanjing and completed the license expansion. As the Company's first calcium

Pharmaceutical Co. Ltd. No.6 Pharmaceutical Factory Pharmaceutical Co. Ltd. supplement in sachet format it represents a "zero-to-one" breakthrough in

The revitalization and industrial this field.upgrading project for the Xuefu Road

plant area of Hayao General Factory was

launched to transform it into an

"Industry+N" integrated industrial park.Acanthopanax Senticosus Base of

Innovation and market practice achievements Harbin Pharmaceutical Group Shiyitang

Co. Ltd. and Second Chinese Medicine

Factory under Harbin Shiyitang Chinese

Medicine Co. Ltd. successfully passed

the provincial good agricultural practice

First Batch of Famous Consumer (GAP) compliance inspection.Renmintongtai ranked 33rd on the "2024

Product Enterprise Brands in

Heilongjiang Province Top 100 Pharmaceutical Retail Enterprises

HARBIN PHARMACEUTICAL by Total Sales" list.GROUP CO. LTD.West Lake Award for West Lake Award for Three new products namely

Innovative Marketing Case Innovative Marketing Case Lactulose Oral Solution Oseltamivir

Harbin Pharmaceutical Group HARBIN PHARMACEUTICAL Phosphate Dry Suspension and Iron

Marketing Co. Ltd. GROUP CO. LTD. Polymaltose Complex Oral Solution

Industry Recognition and Collaborative Impact have obtained drug registration certificates. In addition two active

pharmaceutical ingredients

including Calcium Lactate API and

Iron Polymaltose Complex API have

been approved for marketing

application. This further enriches

the Company’s product portfolio

and continuously promotes the

construction of its product pipeline.CPHCF Award for Outstanding

Fulfillment Chain Enterprise in Partner in the Pharmaceutical Silver Award in the Medical and

China's Pharmaceutical Retail Manufacturing Sector Health Communication Category

Renmintongtai Pharmaceutical HARBIN PHARMACEUTICAL HARBIN PHARMACEUTICAL

Chain Co. Ltd. GROUP CO. LTD. GROUP CO. LTD.

1Among them Iron Polymaltose Complex Oral Solution obtained the drug registration certificate in January 2026 and Iron Polymaltose Complex API was

approved for marketing application as a chemical active pharmaceutical ingredient in January 2026.

09 10About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation Management Shared Future

2025 Key Performance in Sustainability

Economic performance Governance performance Social performance

Operating revenue of RMB Independent directors accounted Total R&D investment: Total number of valid patents held: 14 responsible marketing

15.964 billion for 33.3% 203.5182 million RMB 220 audits

Performed 761 supplier DTP pharmacies served a cumulative Total number of employees:

Total assets: RMB Percentage of female directors: training sessions total of 250000person-times 10039 persons

14.288 billion 44.4%

Number of people assisted

Total employee training duration: Employee trade union coverage

Net profit attributable to sharehold- 248712.2 hours rate: 100 through the Company's public %

welfare initiatives: 5682

ers of the listed company: RMB 9 training sessions for directors

0.362billion

Basic earnings per share: RMB

0.14 per share 14 investor relations activities

Environmental performance

Net assets attributable to share-

100% integrity risk assessment coverage

holders of the listed company: RMB

Total environmental management Total environmental protection investment:

5.688 for the Company and its subsidiariesbillion

training duration: 3569 hours RMB 15.8187 million

Total tax payment: RMB 100% employee signing rate for compli-

Photovoltaic power generation: Percentage of waste reclaimed and reused:

0.733billion ance commitment letters 4784.65 MWh 91.42%

11 12About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for Advance Low-Carbon Creation to Build a Safe and

Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Management Shared Future

Stakeholders Topics of concern Communication channels

Sustainability Management

Innovation-driven development

Information disclosure

Compliant operation

Investor hotline

Internal control and risk management

Sustainability Management System Investor communication platformCorporate governance

Shareholders and On-site/telephone research

investors Shareholder rights protection Social media

Climate change tackling

Aligning with its governance structure and operational realities the Company has established a sustainability management frame-

work led by the Board of Directors with participation from management and coordinated implementation by relevant departments

to research advance and supervise sustainability-related matters.Information disclosure

Investor hotline

Compliant operation

Investor communication platform

As the coordinating management body for the Company's sustainabili- Creditors Internal control and risk management Offline meetings

Strategy and Sustainability ty work it is responsible for overall supervision and guidance of major Social media

Committee sustainability-related matters deliberating key topics and submitting

decision-making recommendations to the Board of Directors.Employees Employee satisfaction surveys

Undertake support and coordination responsibilities for the

Office of the Board of Corporate governance Internal communication platform

Directors Committee's daily operations and ensure the orderly advancement Company employees Energy usage Employee training

of sustainability-related topics.Implement sustainability requirements in their respective domains Information disclosure

Relevant according to assigned responsibilities advance measure implementa- Industry cooperation and exchange Event participation

business and

functional tion and provide relevant information data and execution feedback to Partners and industry

Anti-unfair competition Offline meetings

departments establish a collaborative advancement mechanism. associations Social media

Hapharm Group's sustain-

ability governance structure

Information disclosure

Safety and quality of products and services Customer service hotline

Customer rights and interests protection Customer satisfaction surveys

In alignment with sustainability-related management requirements and ESG development needs the Company organizes special- Responsible marketing Marketing activities

ized ESG training to continuously enhance the overall awareness and understanding of sustainability topics among relevant Customers Data security and customer privacy protection After-sales service

management personnel and business units. The training further strengthens compliance and responsibility awareness regarding Social media

environmental social and governance matters laying a foundation for subsequent sustainability work and information coordina-

tion.Circular economy

Supply chain security Supplier communication and exchange

Equal treatment to small and medium-sized Supplier training and seminars

During the reporting period the Company Suppliers and contractors enterprises

Medical accessibility and inclusiveness

Organized ESG training for ?? participants Ecosystem and biodiversity conservation Information disclosure

Pollutant emissions

Social media

Contributions to the society

Media and the public Event participationWaste disposal

Usage of water resources

Communications with Stakeholders

Daily communication

The Company values communication with all stakeholder groups. Focusing on business operations and sustainability-related Due diligence Offline meetings

topics it continuously monitors reasonable expectations across stakeholder groups and engages through multiple channels. Environmental compliance managementGovernment and Training participation

Feedback received serves as a key input for improving management and optimizing decision-making supporting the Company's regulatory agencies Rural revitalization Information disclosure

stable operations and long-term development.

13 14About This Message About 2025 Key Hapharm Performance in Sustainability

Governance and Compliance Green Operations to Employee Development

Report from the Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability

Management

Stable Growth Creation Management Shared Future

Material Topic Matrix

High

In advancing its sustainability management the Company systematically identifies sustainability-related challenges and opportu-

nities in its operations by considering key capital market concerns national policy directions industry trends and its own strate-

gic priorities. On this basis it has established and refined a materiality assessment mechanism for sustainability topics evaluating

them along two dimensions—financial materiality and impact materiality—to determine priority levels. The assessment outcomes Access to Medicines and

serve as a critical basis for formulating management measures and optimizing decisions. Pharmaceutical InclusivenessCustomer rights and

interests protection

Safety and

Responsible quality of

marketing products and

?? Establishment of a

services

?? Stakeholder survey Supply chain securitysustainability topic library

Pollutant

emissions

Corporate governance

Requirements from regulators Distributing stakeholder survey Internal control and

Contributions risk management

capital markets and rating questionnaires; Data security and customer to the society Industry cooperation Employees

agencies; privacy protection and exchange

Gathering statistics on issues of Anti-unfair competitionEqual treatment to small and

Macro-policy and industry standard concern to stakeholders; medium-sized enterprises Innovation-driven Environmental compliance development

requirements; management

Organizing focus group interviews. Communications with Waste disposal stakeholders

Peer practices company business

?? Company management Rural revitalization Anti-commercial bribery and practices and characteristics. survey anti-corruption

Usage of water resources Energy usage

Shareholder rights protection

Distributing company management

survey questionnaires; Ecosystem and

biodiversity conservation Due diligence Climate change tackling

Analyzing the financial impact of Ethics of science and technology Compliant operation

sustainability topics; Circular economy

Organizing focus group interviews.?? Materiality assessment ?? Formation of a double Highmateriality matrix

Financial materiality

Assessing financial materiality; Forming a double materiality matrix Governance issues Environmental issues Social issues

to present the results of topic

Assessing impact materiality; analysis and assessment;

Determining the materiality The Board of Directors’ review of

threshold. the double materiality matrix.

1516

Impact materialityAbout This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Special Topic to Solidify a Foundation for Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability

Management

Stable Growth Creation Management Shared Future

Special Empowering with a Digital and Intelligent Engine Building a Foundation

Topic for High-Quality Development Through Technological Innovation

Focused on enhancing production governance capabilities and quality control the Company systematically advances digital

workshop construction embedding digital technologies throughout production operations and quality management. It continu- Controlled Production and Quality Throughout the

ously strengthens a production management foundation characterized by controllable quality visible processes and traceable Entire Process

data establishing digital manufacturing practices that meet regulatory requirements and offer replicable value.In production process management electronic batch records (EBR) serve as the core enabling systematic recording and audit

trail management of weighing material charging process parameters and critical operational nodes. It mitigates risks arising from

manual data entry and information dispersion greatly improves data integrity and traceability and effectively ensures stable and

Unified Architecture and System Integration controlled production processes. Product quality data is synchronized with production data allowing centralized analysis and trend identification through the quality management and analytics system. This supports deviation management non-conforming

product control and continuous improvement shifting quality management from post-event correction toward real-time process

monitoring and proactive early warning thereby continuously strengthening closed-loop quality issue management capabilities.The oral liquid formulation workshop of Sanchine and the oral solid dosage form workshop of Hayao No.6 Factory are advancing

digital upgrades under a unified technical architecture and management standards. Through coordinated system integration and

on-site retrofitting they are progressively building a digital operations system covering production execution quality control

equipment operation and energy management. At the system level both workshops have uniformly deployed supervisory control

and data acquisition (SCADA) systems with the manufacturing execution system (MES) as the core interconnected with the

equipment asset management (EAM) system warehouse management system (WMS) energy management system (EMS) and

quality retrospection and analysis system (QRS). This enables centralized collection and collaborative management of production

quality equipment and energy consumption data laying the groundwork for replication and scaled deployment across other

workshops.Digital production site at Sanchine Digital prod哈uc药tio六n 厂site车 a间t H数ay字ao 化No生.6产 Fa现cto场ry workshop

Digital Management System Platform Digital Exhibition & Display Platform

17 18About This Message About 2025 Key Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in

Sustainability

Management Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Group Sustainability Stable Growth CreationChairman Management Shared Future

Special Empowering with a Digital and Intelligent Engine Building a Foundation

Topic for High-Quality Development Through Technological Innovation

Equipment Intelligence and Operational Efficiency

Improvement Capability Building and Demonstration Effectiveness

Hayao No.6 Factory continues to advance digital workshop construction through equipment configuration and automation While ensuring stable system operations the Company simultaneously advances digital capability building. Through internal

upgrades introducing AGVs collaborative robots and automated production lines and deploying intelligent equipment such as training and hands-on practice it cultivates versatile talent who understand both production processes and digital applications

multi-functional fluidized beds and high-speed tablet presses to drive the automation and standardization of key processes. A total enhancing the system's self-operation and continuous optimization capabilities to ensure long-term stable realization of digital

of 183 production units are under centralized monitoring with a 90% connectivity rate for critical equipment. Operational data outcomes. The relevant projects have received provincial-level digital workshop certification and national Level 3 Intelligent Manu-

analysis has reduced unplanned downtime by approximately 30% and increased overall equipment effectiveness (OEE) by an facturing Capability Maturity certification. While strengthening compliance management these initiatives ensure process stability

average of 10.5% significantly improving equipment stability and resource utilization efficiency. Based on visualization tools such and consistency through precise control and end-to-end traceability fundamentally enhancing the quality and safety of finished

as the production cockpit the real-time production status quality metrics and equipment performance are centrally displayed. pharmaceutical products—a contribution of significant importance to public medication safety and societal health.Operational efficiency in key processes has improved by 10%–22% material traceability time has been shortened by 40%–70%

order changeover efficiency has increased by approximately 80% inventory accuracy has reached 99.5% and inventory backlog

risk has been reduced by about 25%.Sanchine has introduced leading domestic oral dosage production equipment and through efficient integration achieved full-pro-

cess automation across washing drying filling sterilization visual inspection and packaging. By implementing SCADA and MES

systems it has enabled seamless data interconnectivity between equipment and systems achieving a 100% connectivity rate for

critical equipment and establishing a robust foundation for production monitoring. Replacing manual material handling with an

integrated system of automated conveyance tracks AGVs and mobile terminals has increased on-time material delivery in

workshops to 98% and delivery accuracy to over 99.5%. Through a dynamic process optimization model equipment OEE has

reached 80% and on-time order delivery has improved by 13%. Additionally energy collection and management systems have

enabled significant energy savings in production reducing energy consumption per RMB 10000 of output value by 15.9%.Certificate of Heilongjiang Province Advanced-Lev- Intelligent Manufacturing Capability

el Digital Workshop Maturity Assessment Certificate

Digital workshop management platform AGV logistics turnover at Sanchine

192001

Governance and

Compliance to Solidify

a Foundation for

Stable Growth

The content of this chapter

Party Building Leadership and Responsibility Implementation ??

Construction of Corporate Governance System ??

Internal Control and Compliance Management ??

Culture of Integrity and Honest Operations ??About This Message About 2025 Key Hapharm Performance in Sustainability

Governance and Compliance Green Operations to Employee Development

Report from the Management Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation Management Shared Future

Party Building Leadership and Responsibility

Implementation Party Building-Led Key Project Initiatives

The Company insists on leveraging Party building to guide synergistic industry-academia-research collaboration and talent

system development treating joint Party building as a vital linkage for advancing scientific innovation technology transfer and

The Company adheres to the leadership of the Party in guiding its reform development and governance practices. Party building talent cultivation. Centered on actual enterprise needs and industrial demands it fosters co-construction partnerships with

work is conducted in strict accordance with the Constitution of the Communist Party of China Regulations on the Work of Primary primary-level Party organizations in universities and research institutes promoting organizational co-building resource sharing

Organizations of State-owned Enterprises of the Communist Party of China Regulations on the Election of Primary Organizations and mechanism alignment to seamlessly connect research capabilities industrial platforms and talent pipelines. Within the

of the Communist Party of China and other relevant rules. It continuously improves the operational mechanism of Party building framework of deep integration between Party work and core operations the Company explores practical pathways where joint

within a standardized and institutionalized framework and regards high-quality Party building as an important support for enhanc- Party building facilitates technological breakthroughs and collaborative mechanisms support talent development gradually

ing corporate governance capacity and operational efficiency. forming a working model of Party-led industry-academia-research-linked and talent-synergized advancement—providing

Focusing on the integrated development and mutual promotion of sustained support for high-quality development.Party building and business operations the Company integrates Party

building into the entire process of corporate governance production

operation reform and development. It keeps transforming the political

and organizational advantages of the Party into governance efficiency Case Party building-led practices in production efficiency improvement and lean management

and development momentum. In practice relying on the Four Promo-

tions mechanism of Party building promoting R&D production Hayao No.6 Factory targeting improved production efficiency and cost optimization uses the "Party Branch

marketing and services the Company embeds the functions of prima- Secretary Leads Projects" initiative as a key lever to deeply integrate Party building into production organization

ry Party organizations into core business links systematically. This and on-site management. Branch secretaries focus on critical areas—including solid dosage production process

achieves full-chain coordination between Party building and business optimization quality testing warehouse management and digital transformation—leading the establishment of

operations improves the pertinence and effectiveness of Party breakthrough projects and organizing core Party members into dedicated teams. Through lean production

leadership and provides solid support for the steady operation and management process streamlining and technological upgrades they continuously address operational bottle-

sustainable development of the enterprise. Party Member Training necks. These projects have achieved phased progress in shortening production cycles optimizing resource

allocation enhancing equipment utilization and advancing digital management demonstrating the positive role

of Party leadership in driving production efficiency and management upgrades.Party Building-Led Synergistic Development of Industry Academia

Research and Talent

The Company insists on leveraging Party building to guide synergistic industry-academia-research collaboration and talent

system development treating joint Party building as a vital linkage for advancing scientific innovation technology transfer and

talent cultivation. Centered on actual enterprise needs and industrial demands it fosters co-construction partnerships with

primary-level Party organizations in universities and research institutes promoting organizational co-building resource sharing

and mechanism alignment to seamlessly connect research capabilities industrial platforms and talent pipelines. Within the

framework of deep integration between Party work and core operations the Company explores practical pathways where joint

Party building facilitates technological breakthroughs and collaborative mechanisms support talent development gradually

forming a working model of Party-led industry-academia-research-linked and talent-synergized advancement—providing

sustained support for high-quality development.Hayao No.6 Factory's "Party Branch Secretary Leads Projects" Initiative

Award Ceremony for Inheriting the Scientists' Spirit and Advancing Innovation

23 24About This Message About 2025 Key Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in

Sustainability

Management Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation Management Shared Future

Case Party building-led practices in cost reduction efficiency enhancement and production capacity breakthroughs Construction of Corporate Governance System

Sanjing Mingshui focusing on key tasks such as cost control expense reduction and capacity enhancement The Company strictly complies with the Company Law of the People's Republic of China the Securities Law of the People's Repub-

systematically advances the "Party Branch Secretary Leads Projects" special initiative. The Party Committee aligned lic of China and relevant regulatory requirements of the China Securities Regulatory Commission (CSRC) and stock exchanges.with operational realities selects topics scientifically and initiates projects precisely. Branch secretaries serve as It continuously enhances its corporate governance structure and internal governance systems standardizes the operational

primary project leaders forming Party-member-led task forces and establishing mechanisms for planning progress mechanisms of authority and responsibility and ensures lawful and compliant operations. By strengthening the governance

tracking and scheduling to ensure orderly implementation. Projects target critical areas including API capacity framework comprising the Shareholders' Meeting the Board of Directors and its specialized committees and management level

expansion process optimization and energy system upgrades achieving substantive progress in increasing batch the Company promotes scientific decision-making standardized operations and steady development laying a solid governance

output optimizing production efficiency and stabilizing product quality. By leading breakthrough projects through foundation for its sustainability.Party building grassroots organizational vitality is further energized providing strong support for the Company's

achievement of annual business objectives. Shareholders' Meeting Audit Committee

Strategy and Sustainability Committee

Board of Directors

Remuneration and Appraisal Committee

President

Nomination Committee

Secretary Chief Vice Vice Vice Vice

of the Financial President of President of President of President of

Board of Officer R&D Production Marketing Operations

Sanjing Mingshui's "Party Branch Secretary Leads Projects" Initiative

Directors

Governance structure

Case Party building-led practices in technological breakthroughs and innovation

Sanchine focuses on technological innovation and quality improvement using the "Party Branch Secretary Leads

Projects" initiative as a key vehicle to advance Party-building empowerment. It channels the strength of Party organi-

zations toward the front lines of R&D and production. Each Party branch establishes task-force projects aligned with

key priorities such as production process optimization quality and cost control and automation upgrades and

organizes Party-member technical experts to advance them collaboratively. Through measures including equipment

parameter optimization process flow improvements and automation enhancements these projects have achieved

phased results in reducing production losses increasing finished product yield and advancing intelligent manufac-

turing. The project-based approach under Party leadership has effectively fostered synergistic alignment between

technological breakthroughs and business development.Management Group Photo

Sanchine's "Party Branch Secretary Leads Projects" Initiative Focusing on corporate governance and standardized operations the Company has established and continuously improved its

governance system and rules of procedure including the Rules of Procedure for Shareholders' Meetings the Rules of Procedure

for the Board of Directors the Independent Director System and working rules for specialized committees. These institutional

arrangements clearly define the boundaries of authority and responsibility and operational mechanisms of governance bodies

providing an institutional guarantee for the independent and effective performance of the Board of Directors.

25 26About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation Management Shared Future

The Company has established a governance structure characterized by clear

delineation of powers and responsibilities standardized operations and mutual During the reporting period the Company

checks and balances. The Shareholders' Meeting composed of all shareholders

serves as the Company's governing authority and exercises decision-making

power over major corporate matters in accordance with the law. Through Had independent directors Had female directors

standardized procedural rules it ensures that all shareholders can exercise their accounting for??.?% accounting for ??.?%

rights lawfully and equally. The Board of Directors is accountable to the Share-

holders' Meeting and fulfills its statutory decision-making and supervisory

duties. Senior management personnel are appointed by the Board of Directors

and are responsible for the Company's day-to-day business operations and Annual General Meeting The Board of Directors fulfills its statutory supervisory responsibilities regarding the Company's strategic planning business

implementation of Board resolutions. management and risk control. By convening board meetings regularly it reviews key matters related to the Company's business

development ensuring that Board operations are standardized orderly and efficient. This guarantees compliance with

To safeguard the independence and effectiveness of the Board of Directors the Company has implemented institutional arrange- decision-making procedures and truthful accurate and complete information disclosure thereby effectively safeguarding the

ments such as the Independent Director System and the Working System for Special Meetings of Independent Directors. These Company's overall interests and the legitimate rights of all shareholders.provide a mechanism to support independent directors in performing their duties lawfully independently and prudently thereby

enhancing the Board's oversight and checks-and-balances capacity in decision-making on major matters and improving the

standardization and effectiveness of its overall operations.During the reporting period the Company

Case Special research to strengthen support for independent directors in fulfilling their duties

Held??Board of at which??matters Achieved a director Organized ?director

In July 2025 the Board of Directors' Office of the Company organized a special research session for independent

Directors meetings were reviewed and approved attendance rate of???% training sessions

directors featuring thematic reports and discussions on GNC China's business operations marketing system

development strategy execution and cross-border business expansion. Drawing on their industry experience and

regulatory insights the independent directors provided targeted recommendations on business operations and

risk management. On-site engagement deepened their understanding of industrial chain operations and gover-

nance practices.The Company continues to strengthen independent To further enhance the professionalism and scientific basis of Board decision-making the Company's Board of Directors has

directors' familiarity with key business areas and operational established four specialized committees: the Audit Committee the Strategy and Sustainability Committee the Nomination

processes through special research joint business visits Committee and the Remuneration and Appraisal Committee. Each committee carries out its duties according to defined responsi-

performance-related training and information exchange bilities and provides support and recommendations to the Board on relevant professional matters thereby promoting scientifically

mechanisms enabling more informed and targeted profes- grounded decision-making and effective performance of duties.sional judgment in decision-making and oversight. These

arrangements have gradually evolved into a regularized

support mechanism for director duties effectively enhanc- During the reporting

period the Company During the reporting period the Company was awardeding information transparency and communication efficiency

and promoting more standardized stable and efficient

corporate governance.Held?Audit Committee

meetings

Board Diversity Held?Strategy and

Sustainability

The Company specifies in its Rules of Work for the Nomination Committee of the Board of Directors that in the nomination and Committee meeting

appointment of directors it comprehensively considers candidates' professional backgrounds industry experience performance

capabilities and independence. Diversity is treated as a key criterion to continuously optimize the composition of the Board of

Directors and foster a structure that integrates diverse perspectives and complementary expertise. Held?Nomination

Committee meeting

As of the end of the reporting period the Company's Board of Directors consisted of nine directors including one employee repre-

sentative director three independent directors and four female directors. The Board exhibits a relatively diverse composition in Held?Remuneration 2025 Excellent Practice for 2025 Excellent Practice Case 2025 Grade 5A Certificate

terms of gender functional roles and professional backgrounds which helps introduce varied perspectives into the decision-mak- the Board of Directors of a for the Board of Directors' for Secretary of the Board and Appraisal Listed Company Office of a Listed Company Performance Evaluation of

ing process thereby enhancing the quality of deliberations and the scientific rigor of decisions. Committee meetings Listed Companies

27 28About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Special Topic to Solidify a Foundation for Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability

Management

Stable Growth Creation Management Shared Future

The Company consistently focuses on protecting the rights of small and medium-sized investors—including their right to informa-

Investor Relations Management tion right to participation and other legitimate interests. By creating diverse and accessible communication scenarios it advanc-es investor relations management from one-way information dissemination toward two-way interaction thereby deepening small

The Company places great importance on investor relations management recognizing it as a critical component for enhancing and medium-sized investors' understanding of and confidence in the Company's governance and long-term value.corporate governance transparency strengthening market recognition and protecting investors' legitimate rights and interests. It

has formulated and implemented the Investor Relations Management System and the Market Value Management System which

clearly define responsibilities workflows and communication standards for investor relations activities ensuring their lawful Case Special research to strengthen support for independent directors in fulfilling their duties

compliant and orderly execution.In September 2025 the Company participated in the "I am

a Shareholder" event for listed companies organized by

the Shanghai Stock Exchange. In collaboration with the

China Association for Public Companies the China

Transparent information disclosure Diversified communication channels

Securities Investor Services Center and the Shanghai

Securities News it invited more than 20 small and

medium-sized investors for an on-site visit and exchange.Aligning with key capital market concerns—such as To ensure the stability and effectiveness of During the event investors toured the Sanchine exhibi-

operating performance development strategy risk communication channels the Company has estab- tion center and the intelligent oral liquid production line

management and sustainability—the Company lished a diversified and regularized investor gaining direct insight into the Company's development

maintains ongoing communication with investors communication mechanism. Leveraging its official journey product portfolio and achievements in intelligent

and shareholders through multiple channels. It website the Shanghai Stock Exchange's "SSE manufacturing. Face-to-face discussions enabled a

provides timely updates on its operational status e-interaction" platform the investor hotline deeper understanding of the Company's strategic

business layout and development plans while earnings calls and Shareholders' Meetings it planning and operational status. The event also featured a

actively soliciting market feedback and construc- provides investors with reliable and convenient dedicated investor education session titled "Know Your "I am a Shareholder" visits Shanghai-listed company—

tive suggestions to enhance the transparency and access to corporate information and opportunities Hapharm GroupRights Exercise Your Rights Protect Your Rights" aimed

comprehensibility of its disclosures. for interaction. at enhancing small and medium-sized investors' aware-

ness of rights protection.During the reporting period the Company During the reporting period the Company was awarded

Disclosed ?periodic announcements and??ad-hoc announcements;

Organized? roadshows and held communications with a total of?? institutional investors;

Conducted?? reverse roadshows hosted ?? securities firms and institutional investors with a total Certificate of Excellent Practice for

the 2024 Annual Report Earnings

of???participants; Call of Listed Companies

Received and answered a total of??? investor inquiries via the investor hotline;

Received a total of???questions from investors with a response rate of??.??%

29 30About This Message About 2025 Key Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in

Sustainability

Management Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation

to Build a Safe and

Management Shared Future

Strategy

Internal Control and Compliance Management Supported by its institutional framework the Company integrates compliance requirements throughout the entire cycle of

The Company values internal control and compliant operations continuously refining relevant systems and management mecha- decision-making execution and supervision extending them to all departments subsidiary enterprises and employees. This

nisms. It embeds compliance requirements into all aspects of business management steadily enhancing its level of standardized facilitates the transition of compliance management from system establishment to normalized operation. Additionally from the

operations and risk prevention capabilities to support sustainable and stable development. perspectives of operational stability and long-term development the Company systematically identifies compliance-related risks

and opportunities using these insights to continuously refine management measures and optimize resource allocation.Risk name1 Specific description Time horizon2 Financial impact Response measures

Compliant OperationIncreased costs Establish a “Three LinesThere are instances where compli- related to non-com- of Defense” compliance

Governance Compliance ance requirements are not fully Medium and pliance penalty management system and

management

implemented during their embedding long term expenses and strengthen enforcement

The Company regards lawful and compliant operations as a fundamental requirement for business management and employee execution risk and execution in business processes potential litigation of policies and supervi-

conduct. Building upon national laws and regulations it has established a compliance management system centered on the losses sory inspections

Compliance Management Measures of HARBIN PHARMACEUTICAL GROUP CO. LTD. supplemented by specialized policies and

operational guidelines. During the reporting period the Company issued three new guidelines: Compliance Guidelines for Prevent- Elevated risk of Regularly conduct n key areas such as fund security tax

ing Commercial Bribery in the Pharmaceutical Sector Advertising Compliance Guidelines and Compliance Guidelines for fund loss higher compliance risk Compliance handling trade secrets and personal

Livestreaming Marketing Activities further strengthening institutional controls over key risks in the pharmaceutical field. compliance costs identification and risks in key information protection risk identifica- Medium-term

and increased assessment and

areas tion is insufficient or controls are

potential compen- formulate and implement

The Company has established a compliance management organizational system centered on the Compliance Committee and the inadequately implemented sation expenses risk response plans

Chief Compliance Officer supported by a management mechanism featuring clearly defined responsibilities and coordinated

operations. It has implemented a compliance management framework based on the "three lines of defense" embedding compli- Opportunity name Specific description Time horizon Financial impact Response measures

ance responsibilities across management levels and business processes to ensure effective implementation of compliance

requirements throughout the organization. Embed compliance The compliance management system

requirements into the

Opportunity for and processes are continuously Reduced compli-

entire process of

management improved and the integration of Medium and ance costs and

Compliance Committee decision-making execu-efficiency compliance requirements into long term decreased

tion and supervision to

improvement business processes is progressively operational losses

Responsible for the organizational leadership and overall coordination of compliance promote process standard-enhanced

management holding regular meetings to study and decide on major compliance matters ization

or propose recommendations and to guide supervise and evaluate compliance manage- Compliance risk identification and Continuously carry out risk

ment activities. Reduced risk-relat-Risk and cost proactive management mechanisms identification classified

Medium and ed losses and

control are gradually strengthened and risk management and the

long term improved cash flow

opportunities control capabilities are continuously development of response

stability

enhanced plans

First line of defense Second line of defense Third line of defense

Discipline inspection and supervision

All departments of the Compliance Management Case Building a compliance assurance system to promote full-staff compliance practices

agencies and audit supervision and

Company Department

accountability departments Centered on the principle of "Compliance Escorting High-Quality Develop-

ment" the Company has established a "1-2-3-10+" compliance assurance

Bear direct and primary responsi- Responsible for organizing Within their scope of authority

system anchored by the Compliance Management Measures and the Employ-

bility for compliance management coordinating guiding and supervis- they supervise the implementation

ee Compliance Manual. It is supported by three checklists—covering compli-

within their scope of duties and are ing compliance management of compliance requirements

ance obligations/risks responsibilities of key positions and key process

responsible for daily compliance activities and providing compliance investigate violations and carry out

controls—and guidelines for priority areas such as anti-commercial bribery in

management in their respective support to other departments accountability procedures as

the pharmaceutical sector and advertising compliance effectively embedding

business areas or departments. (subsidiary enterprises). stipulated.compliance requirements into business processes.Through mechanisms such as compliance reviews risk early-warning systems

Compliance Administrator Compliance Management Specialist Compliance Administrator and violation reporting channels the Company achieves comprehensive cover- "1-2-3-10+" compliance assurance

age across its 18 subsidiary enterprises transitioning compliance from institu- system

tional design to daily execution and employee practice. This provides

Compliance administrators receive business guidance and training from the compliance management

sustained assurance for stable operations.department and provide compliance advice to their department heads for decision-making reference.Organizational structure of Hapharm Group compliance management 1 The risks and opportunities listed in this table are forward-looking identifications made by the Company based on changes in external environment and

internal operational conditions. They are intended to reflect the potential impact trends and key management priorities and shall not constitute a definitive

judgment on future events nor indicate that relevant risks have materialized or exerted significant impacts on the Company’s current operations.

2 Impact time refers to the timeframe over which a significant impact is exerted on the Company: short-term—within 1 year; medium-term—1 to 5 years;

31 long-term—over 5 years. 32About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability

Management

Stable Growth Creation Management Shared Future

Focusing on the compliance management goals of "comprehensive coverage efficient operation controllable risks and cultural Impact risk and opportunity management

consciousness" the Company continuously improves its compliance management system supported by organization systems

operations and assurance embedding compliance requirements into the entire process of business management and employee Focusing on the goal of lawful and compliant operations the Company embeds the identification and management of compli-

performance. By compiling and issuing the Employee Compliance Manual and organizing all employees to sign the Compliance ance-related impacts risks and opportunities into the entire process of business management. It achieves unified management

Commitment Letter it clarifies employee compliance obligations and behavioral boundaries. through system development process control and supervisory collaboration. Relying on the Compliance Committee the Chief

The Company upholds the compliance culture philosophy of Compliance Officer and relevant functional departments and in conjunction with actual business operations it continuously

"acting within principles and rules; with reverence and identifies potential compliance risks and their potential impacts in key areas such as fund security tax management trade secret

self-restraint" and promotes the building of a compliance protection and personal information protection. It then conducts a graded assessment based on the likelihood and impact of

culture through a combination of training and advocacy. these risks. For the identified key risks the Company clarifies management responsibilities through a "three lines of defense"

Relying on its annual compliance training plan it conducts ??? mechanism promoting the effective implementation of risk response measures in system execution daily supervision and rectifi-% signing rate for the

compliance education for key positions and new employees Compliance Commitment Letter cation. Through continuous tracking and dynamic assessment it constantly optimizes its compliance management system releas-

covering topics such as anti-commercial bribery business ing potential opportunities such as improved management efficiency and risk cost control while preventing risks.compliance and professional conduct. Through diversified

advocacy formats it strengthens warning and guidance Indicators and objectives

continuously enhancing employees' compliance awareness.The Company takes enhancing the effectiveness of compliance management and the level of compliance risk prevention and

control as the core goal of its compliance management. By improving the compliance management system it reduces the proba-

bility of major compliance risks ensures that business activities are conducted in accordance with laws and regulations and

Case Building legal and compliance capabilities in key business areas safeguards its operational stability and long-term development foundation.In June 2025 the Company organized a special topic lecture on business legal compliance focusing on key Indicator name Unit ????

business areas such as distributor management and live-streaming operations. An external team of professional

lawyers was invited to deliver the lecture. The training focused on distribution and agency contract management Number of compliance risks identified during the year Items 156

rebate and third-party expense control legal risks in online live-streaming promotion and vertical monopoly

compliance requirements. A total of 249 employees participated online and offline. Through special topic explana- Number of compliance risk response plans formulated Copies 15

tions and case analyses participants further identified compliance risk points in their business operations and

Number of compliance training sessions conducted Times 5

enhanced their contract management and risk prevention capabilities.Number of employees covered by compliance training Person-times 1010

Internal Control

The Company continuously improves its internal control management system regarding internal control as an important founda-

tion for standardizing business management preventing operational risks and enhancing governance effectiveness. Under the

supervision and guidance of the Board of Directors and its Audit Committee management coordinates and promotes work related

to internal control and internal audit pushing for internal control requirements to cover the entire process of decision-making

execution and supervision and ensuring their implementation throughout the Company and its subsidiaries.The Company has established and operates an internal control evaluation mechanism where management organizes and

conducts self-assessments of internal control to systematically evaluate the design and execution effectiveness of its systems.Combined with the results of internal supervision and external independent audits it continuously examines the operation of

internal controls.The Company formulates an annual internal audit plan to audit the business management and internal control operations of the

Company and its subsidiaries. It also promotes the rectification and implementation of issues found during audits forming a

closed-loop management system. During the reporting period the Company conducted 19 internal audit projects covering key

business processes such as procurement marketing fund usage engineering projects asset management financial accounting

budget execution and contract management. No major issues were found.Compliance Training Session

33 34About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to

from the Hapharm Performance in Special Topic to Solidify a Foundation for Product System for Value

Employee Development

Report Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability

Management

Stable Growth Creation Management Shared Future

Culture of Integrity and Honest Operations Anti-Unfair Competition

The Company adheres to lawful compliant and honest operations making integrity building an important part of its corporate Focusing on anti-monopoly and anti-unfair competition management the Company strictly implements the requirements of laws

governance and compliance management. It continuously improves its working mechanisms for anti-commercial bribery anti-cor- and regulations such as the Anti-Monopoly Law of the People's Republic of China and the Anti-Unfair Competition Law of the

ruption anti-monopoly and anti-unfair competition as well as for building an integrity culture and protecting whistleblowers. It People's Republic of China. In conjunction with the Company's and the sector's business characteristics it has formulated and

promotes the integration of integrity requirements into its business management and the entire process of employee perfor- implemented the Anti-Monopoly Management Regulations integrating the principle of fair competition into its business manage-

mance fostering a fair transparent and standardized business environment. ment and employee performance standards. The Company refines and adopts relevant legal requirements through institutionalized

means clarifies internal management requirements and promotes the enforceability and operability of anti-monopoly and

anti-unfair competition requirements within the Company.Anti-Commercial Bribery and Anti-Corruption

Focusing on anti-commercial bribery and anti-corruption management the Company strictly implements the requirements of Whistleblower Protection

relevant laws and regulations such as the Criminal Law of the People's Republic of China and the Anti-Unfair Competition Law of

the People's Republic of China. In conjunction with its actual business management it has formulated and implemented the The Company attaches great importance to the protection of the legitimate rights and interests of whistleblowers making

Anti-Commercial Bribery Management Measures which clarify the behavioral boundaries for employees in business dealings and whistleblower protection an important component of its integrity building and internal supervision mechanism. The Company has

in the course of their duties and integrate integrity requirements into the Company's business management and employee perfor- clarified confidentiality requirements for reported information at the institutional level and strictly implements the Provisions on

mance standards. Confidentiality in Case Handling by the Discipline Inspection Commission of Harbin Pharmaceutical Group Holding Co. Ltd1. It

rigorously manages whistleblowing clues the identity of whistleblowers and related information to prevent leaks or improper use.Reporting Mechanism Integrity Commitment Letter he Company prohibits any form of retaliation and promptly addresses and handles any potential adverse effects arising from

The Company has established and operates a reporting mecha- In accordance with the unified arrangements of the Group’s whistleblowing activities. It strives to create a favorable environment where supervision is encouraged and conducted in accor-

nism for commercial bribery and corruption encouraging Discipline Inspection Commission the Company organized dance with the law providing institutional guarantees for integrity building.employees and relevant parties to report violation clues in all management personnel to sign the Commitment to

accordance with laws and regulations. It has also set up Integrity in Practice achieving a 100% signing rate. For

dedicated channels such as a telephone line and an email confirmed cases of commercial bribery and corruption the Integrity Culture Building

address to receive reports related to commercial bribery and Company conducts investigations and handles them in

corruption. accordance with the law and regulations based on relevant

provisions such as the Regulations on Disciplinary Actions The building of a culture of integrity continues to be synergistically advanced with the building of corporate culture. Through a

Reporting hotline:????????-????? by the Communist Party of the People's Republic of China. It combination of institutional guidance publicity and education and practical activities the Company guides the integration of

holds the relevant parties seriously accountable to maintain integrity requirements into employees' daily work and codes of conduct.Reporting email: hyjtjw@???.com a standardized and orderly business environment.Relying on platforms such as the discipline enforcement and supervision section of its WeChat official account bulletin

During the reporting period the Company boards and electronic screens the Company conducts regular publicity on integrity and compliance. It sets up special

topics such as interpretations of Party discipline and regulations and building of an integrity culture gradually forming a

stable platform for disseminating the culture of integrity. During the reporting period a total of 86 related articles were

published with nearly 10000 views. In conjunction with actual business management and the characteristics of key

positions the Company conducts multi-level warning education. Through visits to integrity education bases holding

warning education meetings and using cases to explain discipline and law it guides employees to be reverent and adhere

to the bottom line. During the reporting period Party organizations and discipline inspection agencies at all levels

organized more than 90 warning education activities covering over 6300 participants. At the same time through activi-

ties such as integrity-themed essay contests short video creation and integrity-focused home visits the culture of

??? ?? ???? integrity is extended to employees' work and life scenarios promoting the transformation of integrity concepts from Achieved % Conducted Organized

institutional constraints to inherent self-discipline and creating a favorable environment for stable operations.integrity risk assessment anti-commercial bribery person-times of anti-com-

coverage for the Company and anti-corruption mercial bribery and

and its subsidiaries training sessions anti-corruption training for

its employees

1 The Company’s discipline inspection supervision and Party committee-related functions are centrally managed by or implemented with reference to

the Group without affecting the effective operation of the Company’s governance structure and internal oversight mechanisms.

353602

Product System

for Value Creation

The content of this chapter

Technological R&D and Innovation Practices ??

Indicators and Objectives ??

Industrial Cooperation and Exchange ??

Product Quality and Safety Management ??

Customer Rights and Interests and Service Assurance ??

Supply Chain Management and Security ??

Information Security and Privacy Protection ??

Medication Accessibility Enhancement ??About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for Advance Low-Carbon Creation to Build a Safe and

Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Management Shared Future

Opportunity name Specific description Time horizon Financial impact Response measures

Technological R&D and Innovation-Driven Development Continuously to shift its

R&D model from "imita-

tion-innovation integra-

Governance Against the backdrop of innova- tion imitation-oriented" to Development Increased revenue

tion-driven pharmaceutical develop- "imitation-innovation

The Company continuously optimizes its R&D management system implementing unified management and hierarchical advance- opportunities for Medium and higher gross margin ment the company continues to integration innovation-ori-

innovative drugs and long term and enhanced asset

ment for R&D activities and has formed an R&D organizational structure of "one department and five institutes" to carry out this advance its R&D portfolio of innova- ented" and strengthens

improved new drugs value

approach. tive drugs and improved new drugs project initiation and R&D

investment in innovative

The Company has established a Scientific Research Management Department responsible for the overall coordination organiza- drugs and improved new

tion and management of R&D work. Under its unified management five specialized research institutes have been set up: the drugs.Hapharm Drug Research Institute Hapharm New Drug Research Institute Hapharm Wellness Research Institute Hapharm Biologi-

Promote the systematic

cal Research Institute and Hapharm Traditional Chinese Medicine Research Institute. These institutes respectively carry out R&D The secondary development of research and secondary

work in the fields of generic drugs innovative drugs OTC and health products biological products and traditional Chinese Opportunities for the established traditional Chinese development of

medicine. By clarifying management levels and responsibilities the Company achieves integrated allocation and specialized secondary develop- Enhanced value of medicine (TCM) products is ongoing established traditional

collaboration of R&D resources promoting the orderly conduct of R&D activities within a unified management framework. ment of established Medium-term existing assets and continuously extending product life Chinese medicine

traditional Chinese increased revenue

cycles and expanding application products and continuous-

medicine products

value ly optimize the product

Strategy pipeline structure

In accordance with overall development planning and R&D strategy the Compa-

ny adheres to innovation orientation. With the core goals of enriching and Construction of the R&D System

building product echelons and optimizing R&D system and team it continues to The Company focuses on five major disease areas: cardiovascular and cerebrovascular digestive and metabolic respiratory

transform the R&D model from "imitation-innovation integration imitation-ori- anti-infective and anti-tumor as well as three key directions: geriatric medicine pediatric medicine and health products. It has

ented" to "imitation-innovation integration innovation-oriented". Focusing on built an product system featuring the coordinated advancement of chemical drugs traditional Chinese medicine and biological

key R&D fields the Company keeps improving its R&D and technological innova- drugs supplemented by differentiated health products. The R&D project initiation focuses on generic drugs with high technical

tion system and implements its five-year R&D strategy and action plan. With the barriers and innovative drugs while simultaneously promoting the secondary development of established traditional Chinese

vision of building a century-old enterprise with sustainable sound development medicine varieties with clinical value continuously optimizing the product pipeline structure and cultivating a competitive product

and becoming a benchmark in China’s pharmaceutical and health industry the echelon.Company establishes long-term R&D thinking making R&D an important

In terms of platform and capability building the Company continuously

foundation supporting its high-quality development. During the implementation

improves its technology platform system adapted to its own R&D charac-

of R&D and innovation strategy the Company identifies and analyzes major risks During the reporting period

teristics. It introduces key technological paths such as continuous flow

and potential opportunities related to R&D and takes corresponding counter- R&D Strategy Promotion Conference biosynthesis peptide synthesis taste-masking technology and sustained

measures.and controlled release to enhance R&D efficiency and product differentia- Shiyitang Traditional Chinese Medicine

tion. At the same time it regards the cultivation of scientific research has been successively accredited as

Risk name Specific description Time horizon Financial impact Response measures talent as an important support for the R&D system. Through a combina- municipal and provincial Postdoctoral

tion of project practice platform construction external training and Innovation Practice Base.Rationally allocate R&D academic exchanges it promotes R&D-production synergy and technolo-

Increased R&D invest-

The new drug R&D process involves a resources advance R&D gy inheritance solidifying the long-term foundation for R&D development.Risks related to the ment and greater

long development cycle technical Medium and projects in stages and

new drug R&D cycle uncertainty in the

complexity and uncertainty in interim long term strengthen dynamic

and uncertainty recovery of capitalized management of R&D Case

Jointly building the Cold Region Traditional Chinese Medicine R&D Platform to solidify the foundation of

outcomes industrial innovationexpenditures

projects

To advance the resource protection and modernization of Chinese materia medica in cold regions Shiyitang Chinese

Medicine and Northeast Forestry University signed the Letter of Intent for the Construction of a Joint R&D Center for

Strengthen the evaluation Cold-Region Longjiang Medicines to jointly build the "Joint R&D Center for Cold-Region Longjiang Medicines" and

Risk of intensified of R&D project initiation

In the high-barrier generic drug on this basis jointly establish a postdoctoral research workstation.competition for Declining revenue and focus on selecting

segment market competition is

generic drugs with Medium-term compressed profit varieties with technical intensifying and pressure on R&D and

high technical margins barriers and enhance R&D The two parties will cooperate in areas such as resource protection of authentic Chinese materia medica in cold

regulatory registration is increasing

barriers efficiency and product regions GAP standardized planting construction of a quality traceability system and research on new functions and

differentiation components of traditional Chinese medicine. The initial cooperation period is planned for 2025–2029 aiming to

promote the transformation of scientific research achievements and the cultivation of professional talent thereby

boosting the innovation capabilities and scientific research level of the regional traditional Chinese medicine industry.

39 40About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Hapharm Performance in Special Topic to Solidify a Foundation for Product System for Value

Employee Development

Report from the Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability

Management

Stable Growth Creation Management Shared Future

Green R&D and Green Products

Case Deepening industry-academia-research cooperation to promote the building of TCM innovation capabili-ties

In 2025 focusing on the innovative development of traditional Chinese The Company integrates green concepts into the entire R&D process practicing the R&D policy of "green R&D + safety and

medicine Shiyitang Chinese Medicine organized its R&D team to conduct quality." Focusing on reducing energy consumption minimizing pollution and enhancing resource utilization efficiency it continu-

exchanges and investigations with universities including Harbin Institute ously promotes the application of green technologies in the R&D of pharmaceuticals and health products. Through technological

of Technology Beijing University of Chinese Medicine Heilongjiang paths such as synthetic biology and continuous flow the Company optimizes process flows at the R&D stage reducing raw materi-

University of Chinese Medicine and scientific research institutions such al consumption and environmental load while improving reaction efficiency and product stability.as Tianjin Pharmaceutical Research Institute. Special seminars were held

on innovative TCM drugs improved TCM drugs evidence-based medicine In specific practice synthetic biology technology centered on biological systems achieves sustainable raw material conversion

research and post-marketing evaluation of TCM injections. and highly selective synthesis; continuous flow technology centered on process intensification enhances the safety stability and

resource utilization of reaction processes. These green technologies play a supporting role in the R&D and process design stages

Through sustained industry-university-research exchanges the Company laying the foundation for the industrial application of green processes and driving product R&D towards low energy consumption

reached cooperation consensus on multiple research fields and promoted low emissions and high quality.the signing of letters of intent. This laid a foundation for subsequent R&D

Exchange Visit with Tianjin Pharmaceutical Delivery Unit Mixing Unit Reaction Unit Back Pressurecooperation and achievement transformation and further improved the Research Institute Unit

enterprise’s innovation capacity and R&D system construction.Reagent

A

Product

The Company simultaneously improves its incentive and project management mechanisms for R&D personnel. It has formulated

and implemented the R&D Project Incentive Plan of HARBIN PHARMACEUTICAL GROUP CO. LTD. (Trial). Centered on the full Reagent

life-cycle management of R&D projects this plan links project progress with the performance of R&D teams by setting quantitative B

assessment indicators at key milestone nodes. This forms an achievement-oriented incentive mechanism enhancing the motiva- Continuous Flow Schematic Diagram

tion of R&D personnel and the efficiency of project execution and providing a dynamic guarantee for the continuous advancement

of the R&D strategy. Intellectual Property Protection

The Company continues to increase its R&D investment supporting the implementation of its R&D strategy with an institutional-

ized investment guarantee mechanism. It advances projects through a combination of independent R&D and external cooperation. The Company conducts intellectual property management in accordance with the law strictly adhering to the requirements of laws

During the reporting period over a hundred projects were initiated covering new drugs generic drugs and biological products and regulations such as the Civil Code of the People's Republic of China the Trademark Law of the People's Republic of China

with more than 50 projects having been approved or completed. The Company and its subsidiaries have obtained multiple national and the Patent Law of the People's Republic of China to implement full-process management of trademarks patents and

provincial and municipal innovation qualifications and have been recognized as scientific research platforms providing support copyrights. The Company has formulated and implemented the Regulations on the Management of Patents and Monographs to

for the implementation of the R&D strategy and the transformation of its achievements. standardize matters such as application maintenance rights management and termination. In terms of trademark management

it has implemented the Regulations on the Management of Trademarks of HARBIN PHARMACEUTICAL GROUP CO. LTD. clarifying

the requirements for trademark registration use licensing and maintenance to prevent infringement and improper use risks.Certifications/honors

On the basis of system implementation the Company enhances its intellectual property protection capabilities through training

National High-tech Enterprise and exchanges. It conducts training for R&D personnel new employees and relevant positions on topics such as patent basics

HARBIN PHARMACEUTICAL GROUP CO. LTD. National Intellectual Property Advantage Enterprise innovation point mining rights protection practices and standardized trademark use. It also organizes participation in sector

Harbin Pharmaceutical Group Sanjing Qianhe Pharmaceu- (Demonstration) intellectual property exchange activities to continuously strengthen employees' compliance awareness and professional capabili-

tical Co. Ltd. Harbin Pharmaceutical Group Bioengineering Co. Ltd. ties promoting the effective protection and transformation of innovative achievements.Harbin Pharm Group Sanjing Pharmaceutical Co. Ltd. Heilongjiang Province "Specialized Refined Differential

Harbin Pharmaceutical Group Bioengineering Co. Ltd. and Innovative" Small and Medium-Sized Enterprise Impact Risks and Opportunities

Harbin Pharmaceutical Group Sanjing Mingshui Pharma-

ceutical Co. Ltd. Harbin Pharmaceutical Group Bioengineering Co. Ltd.Harbin Shiyitang Chinese Medicine Co. Ltd. Harbin Shiyitang Chinese Medicine Co. Ltd. In R&D activities the Company simultaneously identifies operational impacts risks and development opportunities brought by

Harbin Pharmaceutical Group Sanjing Daqing Glass Heilongjiang Province Technological Innovation Demon- technological innovation and integrates relevant management requirements into R&D decision-making and project management

Industrial Park Co. Ltd. stration Enterprise processes. At key links including R&D project initiation project evaluation and annual planning the Company comprehensively

Harbin Pharmaceutical Group Shiyitang Chinese Decoction considers technical feasibility market demand policy environment and resource allocation. It systematically identifies and assess-

Harbin Pharmaceutical Group Bioengineering Co. Ltd.Pieces Co. Ltd. es the uncertainty of cost cycle and achievement in R&D activities.National Torch Program Harbin Antibiotic Heilongjiang Provincial Enterprise Technology Center Via milestone management phased evaluation and dynamic adjustment mechanisms the Company maintains continuous supervi-

Specialty Industrial Base Harbin Pharmaceutical Group Bioengineering Co. Ltd. sion over R&D projects and optimizes R&D pipeline and resource allocation based on evaluation results. While preventing R&D

HARBIN PHARMACEUTICAL GROUP CO. LTD. HARBIN PHARMACEUTICAL GROUP CO. LTD. risks and improving resource efficiency it promotes the transformation of technological innovation achievements and sustains

the supporting effect of innovation on core competitiveness and long-term development.

41 42About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth

Creation Management Shared Future

Indicators and Objectives Industrial Cooperation and Exchange

Focusing on R&D and innovation work the Company has defined its core management objective as improving the operational

Grounded in the broader context of the pharmaceutical and health industry's development the Company actively integrates into

quality of the R&D system and the efficiency of achievement transformation. By strengthening the overall planning of R&D project

the collaborative development patterns of the industrial and innovation chains. Focusing on key directions such as the inheritance

screening and process management it continuously optimizes the structure of the R&D pipeline and the efficiency of resource

and innovation of traditional Chinese medicine the enhancement of fundamental industrial capabilities and the transformation of

allocation. The Company focuses on strengthening the layout and management of projects with high technical barriers and high

scientific and technological achievements it continuously expands the depth and breadth of industrial cooperation. This promotes

clinical value promoting a positive cycle between R&D investment and product outcomes and business benefits thereby provid-

the effective connection of industry academia research and application contributing to the overall improvement of the industrial

ing sustained support for the Company's long-term and steady development.chain and the high-quality development of the regional pharmaceutical industry.Indicator name Unit 2025

Case Participating in the industrial collaboration of Chinese materia medica in cold regions to promote the Total R&D investment Ten Thousand Yuan 20351.82 development of regional industrial chains

R&D Expenditure as a Percentage of Operating Revenue % 1.27 In March 2025 Shiyitang Chinese Medicine as one of the

R&D Expenditure as a Percentage of Operating chain-leader enterprises in Heilongjiang province's Chinese

Revenue of Industrial Sector % 3.54 materia medica industry chain co-organized the "Cold-Region

Proportion of R&D personnel % 10.54 Longjiang Medicines · Acanthopanax Senticosus" Industry Devel-

opment Conference. The conference focused on the resource

Total Amount of Science and Technology

Innovation Awards Issued Ten Thousand Yuan 215.33 protection standardized cultivation industrial synergy and value

Number of Recognized Science and Technology enhancement of authentic Chinese materia medica in cold regions

Innovation Projects Items 146 like Acanthopanax senticosus. It brought together representatives

Total number of valid patents held Items 220 from relevant provincial government departments scientific

research institutions industry associations and enterprises for

Total number of invention patents applied for in the year Items 24 exchanges and discussions to jointly explore collaborative devel-

Total number of invention patents granted in the year Items 1 opment paths for the Chinese materia medica industry chain. By

building a multi-party communication platform the Company The First IP Image of Hailong Chinese Herbal Medicine –

Total number of valid trademarks held Items 774 actively promotes the integration of resources and Shiyitang Vitality Xiaowu

upstream-downstream collaboration in the Chinese materia

medica industry fostering the construction and high-quality

development of a regional traditional Chinese medicine industrial

Ethics of Science and Technology cluster.The Company's business management revolves around pharmaceutical R&D technology development and related scientific and

technological activities with its business covering areas such as chemical drugs traditional Chinese medicine biological

products and health products. In the management of its scientific and technological activities the Company adheres to the princi-

ple of legal compliance making ethics of science and technology requirements an important prerequisite for R&D management

and scientific research cooperation to ensure that related activities are carried out in an orderly manner within a standardized

framework.The Company complies with national requirements related to technology ethics and research management such as Good Clinical

Practice the Measures for the Ethical Review of Life Sciences and Medical Research Involving Human Participants and the

Measures for the Review of Ethics of Science and Technology (Trial). Through internal systems like the R&D Project Management

Measures it standardizes the initiation implementation and collaborative research of R&D projects. The systems stipulate that if

an R&D project involves clinical trials non-clinical studies or entrusts third parties to conduct related research activities it must

be executed in strict accordance with current national laws regulations and regulatory requirements. Compliance responsibilities

must also be clearly defined in cooperation or entrustment agreements to ensure that the entire research process meets ethical

and compliance requirements.The Company itself does not conduct research activities involving human clinical trials or animal experiments. In cases of commis- “Cold-Region Longjiang Medicines · Acanthopanax Senticosus” Industry Development Conference

sioned research or external cooperation the Company requires its partners to possess the corresponding qualifications by law and

imposes management constraints on their research conduct to ensure compliance with national ethics of science and technology

and regulatory requirements thereby preventing potential ethical and compliance risks at the source. During the reporting period

the Company had no instances of violating laws and regulations related to the ethics of science and technology.

43 44About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon

Creation to Build a Safe and

Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Management Shared Future

Product Quality and Safety Management Opportunity name Specific description Time horizon Financial impact Response measures

Continuously optimize

Product quality consistency and

Revenue growth the quality management

Governance stability are continuously Quality improvement Medium and enhanced brand system and strengthen improved and quality management

opportunity long term premium and quality control and

capabilities are steadily strength-

improved cash flow quality review through-

The Company always places product quality and drug safety at the core of its business management. Adhering to the principle of ened out the entire process

"compliance first full-process control and continuous improvement" it strictly follows the requirements of laws and regulations

such as the Drug Administration Law of the People's Republic of China Good Manufacturing Practice (GMP) and Good Supply

Practice for Drugs (GSP). The Company has established an integrated quality management system that covers the entire industri-

al chain and complies with industry regulatory standards. It has formulated and implemented policy documents such as the

Management System of the Comprehensive Quality Management Committee and the Quality Document Management Procedures

of the Joint-Stock Company to clarify quality management responsibilities processes and supervision mechanisms building a Full-Lifecycle Quality Management

quality management system that meets the regulatory requirements of the pharmaceutical sector.The Company systematically incorporates product quality and drug safety into its business management and quality governance

The Company continuously improves its quality management system structure. The Quality and Manufacturing Technology

systems gradually forming a management model guided by full-lifecycle quality management. The Company integrates quality

Department leads the overall coordination of quality management system development operational supervision and continuous

management requirements into every stage of the product life cycle from R&D to post-market surveillance. By combining system

improvement efforts. Each production operation and R&D entity in line with its own business characteristics strictly implements

development with process control it promotes the transformation of quality management from a singular focus on production

mandatory standards such as GMP and GSP. They formulate quality management system documents that match their product

control to a comprehensive front-end management approach providing continuous assurance for product quality stability and

types and business scopes ensuring seamless integration of quality management in organizational structure system execution

drug safety.and daily operations thereby comprehensively strengthening the foundation of quality control.? Product R&D stage ?Production and distribution stage ? Product post-market stage

Strategy

Adhering to the philosophy of The Company continuously The Company has established

The Company focuses its core efforts on building a compliant and efficient quality management system pursuing the "dual zero" "Quality by Design" the improves its quality manage- a mechanism for monitoring

goal and achieving quality excellence. It systematically enhances its quality management capabilities by focusing on areas such Company systematically ment mechanism covering raw adverse drug reactions and

as quality operation evaluation quality risk prevention and control digital and intelligent application in quality and the develop- conducts quality risk assess- and auxiliary material access quality feedback collecting

ment of professional talent echelons. Risks and opportunities related to product quality and safety are integrated into the daily ments process validations supplier audits production safety information through

operation and evaluation of the quality management system. and stability studies during process control finished multiple channels and

drug formulation design product inspection and release conducting analysis evalua-

Risk name Specific description Time horizon Financial impact Response measures process development and warehousing and transporta- tion and reporting in accor-

technology transfer. It defines tion and product traceability. It dance with regulatory

Strengthen standardized

product quality standards strengthens quality control of requirements. Concurrently

control throughout the entire

life cycle and process critical quality attributes and raw and auxiliary materials by the Company has formulated

enhance the precision of critical process parameters to implementing tiered audits and and implemented product

process control reinforce ensure that R&D outcomes dynamic management of recall management

Quality control measures in R&D quality awareness and have stable and reproducible suppliers. During the produc- documents which specify

Product recall losses

production or testing are professional capability production conditions before tion process it reinforces recall classification standards

Risk of quality Medium and compensation

inadequately implemented and the cultivation promote a entering the industrialization standardized requirements for disposal procedures and

control failure long term expenses and

quality management system has proactive risk prevention and

reduced revenue stage. Relevant R&D data and key processes critical responsibilities. When

operational weaknesses control mechanism and change information are equipment and operating potential quality or safety risks

establish a diversified quality managed and controlled in a personnel to ensure that are identified the Company

audit and supervision system standardized and traceable production activities remain can promptly initiate recall

to comprehensively build a

manner reducing the controlled. In the inspection measures of the appropriate

line of defense for quality

and safety likelihood of quality fluctua- and release stage an indepen- level leveraging its product

tions in subsequent produc- dent quality management traceability system to ensure

Continuously track tion and distribution stages function implements a that risks are controllable and

Drug regulatory policies and

Rising compliance regulatory changes improve from the source. multi-level review and release disposal is effective.technical standards are continu-

Regulatory compli- Medium and costs and heightened the quality management process and no product is

ously updated posing a risk of

ance risk long term risk of asset system conduct compli- allowed to enter the market

delayed alignment in the quality

impairment ance training and perform without approval.management system

regular system assessments

45 46About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability ReportCreation

Chairman Group Sustainability Stable Growth Management Shared Future

Based on the actual needs of product quality management the Company formulates an annual quality improvement plan defining

key improvement directions and implementation milestones and organizes its affiliated enterprises to advance quality improve- Case Honing elite skills through practice and demonstrating true expertise in competition

ment work as planned. Through regular internal quality audits management reviews and evaluations of improvement effective-

ness combined with dynamic monitoring and systematic optimization of the entire process the Company continuously enhances

the maturity of its quality management. This drives a steady improvement in product quality and drug safety levels effectively

safeguarding public safety and efficacy in medication use. In November 2025 the Company organized a "Qual-

ity Inspector Competition". The competition adopt-

ed a format combining "theoretical assessment and

Quality Management System Capabilities Building on-site practical operation" to comprehensively

evaluate the inspectors' understanding of regula-

tions professional judgment and operational

The effective operation of the quality management system relies on the combined efforts of system execution personnel capabili- standards. The theoretical assessment focused on

ties and organizational synergy. The Company continuously improves its quality management systems and business processes quality standards inspection principles and

systematically integrating quality management requirements into R&D production sales service and related business segments. problem analysis skills while the on-site practical

This promotes stable and effective linkage and operation of quality management across all stages. operation emphasized the execution of standard

operating procedures and actual inspection skills.To reinforce the implementation of quality responsibilities the Company uses positive incentive mechanisms to guide employees Through this competition which promoted learning

to proactively fulfill their quality duties. For key positions such as quality management production operations and inspection and and practice a platform for technical exchange in

testing it implements professional skill competitions job incentives and rewards for quality improvement suggestions. It also quality inspection was established. It effectively

links quality performance with individual evaluations and performance results ensuring that employees continuously improve enhanced the professional capabilities and regula-

their operational standardization and work quality in their daily work. tory awareness of the inspection personnel provid- Quality Inspection Staff Skill Contest

ing talent support for the stable operation of the

At the same time the Company regards professional capability building as a crucial guarantee for the long-term effective opera- quality management system.tion of its quality management system. Through a combination of systematic training and practical experience it continuously

enhances the understanding and execution capabilities of quality management production and inspection personnel regarding

regulatory requirements technical standards and quality risks. This approach promotes the transformation of quality manage-

ment from a system requirement to a level of excellence solidifying the foundation for the sustained and effective operation of

product quality and safety management.Case Heilongjiang Provincial Drug Quality Inspector Employee Professional Skills Competition

Case Enhancing professional capabilities in the quality technology sequence

In December 2025 the Company selected 13 contestants

The Company continues to advance the professional capability to participate in the Heilongjiang Province Drug Quality

building of its quality technology sequence. It has organized eight Inspector Professional Skills Competition with nine of

subsidiaries and affiliates to complete the compilation of the Enter- them achieving outstanding results including sweeping

prise-Level Quality Technology Professional Capability Manual and the first and second prizes. During the preparation

its supporting question bank. In accordance with the latest manage- period the Company determined the final contestants

ment requirements of the 2025 edition of the Pharmacopoeia of the through multiple rounds of competitive assessments and

People's Republic of China the Company has systematically invited professional instructors to conduct specialized

optimized the Quality Inspection Professional Capability Enhance- practical training to help them master key assessment

ment Manual of the Company. On this basis the Company simultane- points and enhance their competitiveness. The competi-

ously conducted specialized training and assessments for quality tion consisted of two parts: theory and practical opera-

technology inspection personnel covering eight enterprises to tion comprehensively testing the contestants' profes-

solidify the professional capabilities of the quality management sional knowledge and practical skills. Leveraging their

system. To promote and implement the new edition of the Pharmaco- solid foundation and craftsmanship the Hapharm

poeia of the People's Republic of China a total of 104 internal and contestants won multiple honors in the fierce competi-Quality technology training

external training sessions were organized during the reporting tion inspiring all quality inspection personnel in the

period covering 1838 participants. This has continuously enhanced Company to refine their skills and jointly build a line of

the understanding and execution level of inspection personnel defense for drug quality and safety.regarding the new standards ensuring that inspection work Provincial Drug Quality Inspector

Professional Skills Competition

complies with the latest regulatory requirements.

47 48About This Message About 2025 Key Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in

Sustainability Product System for Value

Group Sustainability Management

Special Topic to Solidify a Foundation for Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability ReportCreation

Chairman Stable Growth Management Shared Future

Impact Risks and Opportunities Indicators and Objectives

In response to the high requirements of the pharmaceutical sector for product safety compliance and risk controllability the Focusing on its established quality objectives the Company continuously monitors and evaluates key quality indicators. By

Company has integrated product quality-related impacts risks and opportunities into a unified quality management framework. improving risk prevention and control measures and operational management mechanisms it promotes the continuous improve-

This framework covers key stages such as R&D production supply chain distribution and post-market management forming a ment and effective operation of its quality management system ensuring the implementation of quality objectives and phased

risk management process that spans the entire product lifecycle. By embedding quality risk management requirements into its management requirements.daily quality operations the Company continuously identifies factors that may affect product quality drug safety operational

stability and market trust thereby promoting a continuous shift in quality management towards proactive identification and

in-process control. During the reporting period the Company

The Company systematically identifies quality-related risks and potential impacts through channels such as the execution of No major quality accidents throughout the year non-conformance announcements

quality management systems production process control supplier quality management pharmacovigilance information monitor-

ing and internal and external audits. It conducts graded assessments based on the likelihood and severity of the risks. For major ? time ? item

or urgent quality risk events the Drug Safety Committee coordinates the assessment the Quality Management Department takes

pass rate in supervisory inspections product release pass rate

the lead and relevant business departments participate collaboratively to ensure that risk information is identified effectively

judged and responded to in a timely manner. During the reporting period the quality audit coverage rate for pharmaceutical ???% ???%

manufacturing enterprises R&D enterprises and non-pharmaceutical business-related enterprises was 100%.Pharmacovigilance

Internal quality monitoring Customer complaints Regulatory spot Adverse reaction Drug safety

checks monitoring information The Company conscientiously fulfills its primary responsibility as a Marketing Authorization Holder treating pharmacovigilance as

a crucial lever for ensuring public medication safety. It strictly adheres to regulations such as the Measures for the Reporting and

Monitoring of Adverse Drug Reactions and Good Pharmacovigilance Practice. It has established a pharmacovigilance center

staffed with full-time professionals to uniformly coordinate and supervise pharmacovigilance activities. A pharmacovigilance

management platform has been developed to unify systems standards operational procedures and assessment requirements. It

Production process Product adverse also conducts regular supervision inspection and guidance for its subsidiary enterprises and drug research institutions to ensure

supervision product After-sales calls Spot checks by Adverse drug reaction r e a c t i o n / d r u g that all pharmacovigilance activities are conducted in compliance with regulations.and material inspec- official website drug regulatory monitoring system safety information

tion deviation identi- store feedback authorities customer complaints obtained by compa- The Company continuously collects drug safety information through multiple channels including the National Adverse Drug

fication ny employees Reaction Monitoring System customer complaints feedback from medical institutions and literature monitoring. Upon receiving

information about adverse reactions it promptly records assesses causality and implements follow-up management. All informa-

tion meeting reporting criteria is classified and submitted within specified timeframes via the national direct reporting system for

adverse drug reactions in accordance with regulatory requirements. Based on regular analysis and assessment results it dynami-

cally optimizes risk prevention and control measures to enhance the timeliness and effectiveness of its risk response.Channels for identifying quality issues

At the same time the Company continues to strengthen its professional capabilities in pharmacovigilance. Focusing on new

regulations and key inspection points it organizes specialized pharmacovigilance training and incorporates course resources

In terms of risk response and control the Company implements closed-loop management of quality abnormalities and potential from the National Center for ADR Monitoring China and professional industry institutions achieving full coverage of personnel in

risks through mechanisms such as deviation management change management and corrective and preventive actions (CAPA). relevant positions. This continuously enhances professional judgment and compliance execution capabilities providing strong

The Company analyzes the root causes and impact levels of risks and takes corresponding disposal measures based on the risk support for the ongoing management of drug safety risks.level to prevent the escalation or recurrence of risks. By tracking the effectiveness of corrective actions it continuously optimizes

its quality management systems and processes steadily enhancing its overall quality management capabilities.While strengthening quality risk prevention and control the Company also focuses on the positive impacts and development

opportunities brought by enhancing its quality management capabilities. By continuously improving its quality management

system and enhancing product quality consistency and full-process compliance the Company strengthens its adaptability to

changes in regulatory policies solidifies its foundation of market trust and reduces the potential impact of quality issues on its

operations and finances from the source.

49 50About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Special Topic to Solidify a Foundation for Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability

Management

Stable Growth Creation Management Shared Future

Customer Rights and Interests and Service Assurance Case Professional service capability building for DTP pharmacies

In 2025 Renmintongtai continued to refine its DTP training system

in alignment with the professional service requirements of DTP

To ensure public medication safety and enhance service accessibility the Company has established and implemented internal pharmacies. It organized targeted training sessions led by physi-

policies such as the Customer Service Management System. It embeds customer service requirements into product information cians from Grade A tertiary hospitals and senior licensed pharma-

management service response and daily operations to promote standardized and orderly customer service activities effectively cists employing a blended approach combining online and offline

safeguarding the legitimate rights and interests of customers and consumers. Aligned with its corporate culture and values it learning with self-study. The training covered multiple key disease

unifies customer service standards and codes of conduct clarifying a service orientation centered on integrity professionalism areas and core business modules strengthening pharmacists'

collaboration and efficiency. It continuously cultivates a professional standardized pragmatic and efficient service image to professional capabilities in full-cycle patient management

enhance brand reputation and customer satisfaction. cold-chain drug handling standards and compliant service delivery.Concurrently the Company regards professional capability development as a critical enabler. Focusing on key service scenarios Building on this foundation Renmintongtai innovatively introduced

such as rational drug use guidance chronic disease management support and special medication assurance it continuously an AI-powered intelligent learning and practice platform with drug

enhances the professional competence and service capabilities of front-line staff driving the evolution of customer service from consultation and patient follow-up as core training scenarios.basic support toward more professional refined and sustained assistance. Through routine knowledge exercises and simulated follow-up

drills the platform helps pharmacists consolidate professional

knowledge on drug indications dosage and administration

standardize service procedures and communication approaches

Case Special topic training on chronic disease management to enhance frontline pharmacy service capabilities and enhance the professionalism and consistency of patient

follow-ups.Renmintongtai periodically organizes training on key disease management focusing on the long-term medication

and health management needs of patients with chronic diseases. These sessions concentrate on high-prevalence

chronic conditions such as diabetes systematically explaining disease characteristics key points of standardized AI-Powered Intelligent Learning

medication use and related health management content to enhance the professional service capabilities of and Practice Platform

front-line employees.In October 2025 Renmintongtai invited a chronic disease management expert to deliver a special training session

on Chronic Disease Management for Diabetes covering disease mechanisms complication risks individualized

medication and lifestyle interventions. Sixty front-line store employees participated effectively enhancing their

practical competencies in chronic disease identification medication guidance and patient communication.The Company has established the Quality Complaint Manage-

ment System. When customer complaints or quality-related During the reporting period the Company

issues arise it follows established procedures for acceptance

investigation resolution feedback and corrective action. A

tiered management approach is applied based on the nature and

Handled ???% customer feedbacks

severity of the issue with clear assignment of responsible parties

and handling requirements. Relevant personnel promptly identify

root causes implement corrective measures and track their

effectiveness promoting closed-loop issue management and

continuous improvement of service quality to prevent recurrence

of similar issues.Considering store layouts and actual service scenarios the Company is gradually exploring the appropriate extension of conve-

nient services without compromising the standardized operation of its core business. Selected stores provide essential conve-

nience support and basic assistance to residents of surrounding communities and outdoor workers enhancing service accessibil-

ity and enabling stores to function not only as healthcare access points but also as community service hubs. By organically

integrating customer service with quality management terminal operations and community engagement the Company continu-

ously shifts its customer relationships from transactional interactions toward more stable and sustainable service partnerships

Training on chronic disease management for diabetes systematically addressing the diverse needs of different groups.

51 52About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Hapharm Performance in Special Topic to Solidify a Foundation for Product System for Value

Employee Development

Report from the Management Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth

Creation Management Shared Future

In advertising and communications management the Company implements a unified content review system and a tiered account-

Case Consumer training and interactive service programs ability framework. All advertising and promotional materials must undergo internal review and filing. Promotions involving pharma-

ceuticals or health-related content are subject to statutory review requirements and pre-publication compliance and risk assess-

ments. In media collaborations and new media communications it adheres to standardized expression and cautious publishing

The Company continuously implements consumer training and interactive service programs. Through standardized

practices to prevent inappropriate promotion and compliance risks. At the point of service the Company relies on its retail stores

health education and service activities it enhances public health literacy and terminal service quality extending

to uniformly implement standardized service processes and pharmaceutical care requirements guiding consumers toward rational

customer engagement beyond transactional interactions toward long-term service relationships.and safe medication use through structured medication counseling and service management thereby avoiding misleading recom-

mendations or improper marketing practices.The program primarily leverages chain pharmacies as its main platform complemented by community and public

cultural venues to establish a multi-scenario service model. Through patient education health lectures and interac-

Additionally the Company emphasizes the social value of health communication disseminating content on drug safety rational

tive experiences it delivers scientific and standardized knowledge on medication use and health management to

drug use and health science through official channels to enhance public health awareness. To meet advertising compliance and

consumers. The Company collaborates with chain partners on activity planning and execution to enhance store

service standardization requirements it regularly organizes training on relevant regulations and practical implementation cover-

service capabilities and accessibility. In 2025 the program conducted a total of 405 sessions reaching approximate-

ing key areas such as advertising production and review procedures official website and new media content operations and

ly 13000 consumers. While improving service engagement and consumer satisfaction it also accumulated practical

promotional standards for live-streaming and e-commerce platforms. This further strengthens compliance awareness and risk

experience for refining the terminal service system and advancing health science communication.mitigation capabilities among relevant personnel promoting more standardized and orderly external communications and terminal

services.Case Advertising compliance review and regulatory training

In May 2025 to further enhance the standardization and security of its external communications the Company

organized "Training on Advertising Compliance Review and Relevant Laws and Regulations" delivering systematic

instruction to key personnel involved in external promotion through a blended online and offline format. The training

addressed critical topics including advertising production and review procedures official website content operation

standards publishing requirements for official WeChat accounts and self-media platforms live-streaming content

management and promotional language standards for e-commerce platforms. It also provided focused guidance on

Consumer training and interaction advertising review essentials and common risks contextualized within real-world work scenarios.The training covered 105 personnel from

relevant departments effectively enhancing

Case Emergency cold chain distribution to ensure the medication needs of medical institutions their understanding and execution of adver-

tising compliance requirements strengthen-

ing risk identification and compliance aware-

In April 2025 the Yichun Maternal and Child Health Hospital encountered an urgent medication need during clinical ness in external communications and provid-

treatment that could not be met by its in-house inventory in the short term. Upon receiving the request Logistics ing assurance for the standardized and order-

Center immediately activated its emergency customer service and distribution response mechanism coordinating ly conduct of the Company's marketing and

logistics warehousing and quality functions to swiftly complete drug allocation verification cold-chain packaging communication activities.and dispatch. During transportation the Company strictly adhered to cold-chain transport and temperature control

requirements arranged dedicated direct delivery and implemented end-to-end monitoring to ensure the drugs met

usage standards for both delivery timeliness and quality safety. The required medications were delivered on time and

safely ensuring continuity of clinical treatment. Responsible marketing training

Responsible Marketing

During the reporting period the Company

The Company places consumer health and legitimate rights at the core of its operations and upholds responsible marketing as a

fundamental principle of its market activities. It continuously standardizes its marketing and external communication practices. In

all marketing communication activities it strictly complies with laws and regulations including the Advertising Law of the People's

Republic of China the Drug Administration Law of the People's Republic of China and the Law of the People's Republic of China Performed ?? responsible marketing audits

on the Protection of Consumer Rights and Interests. It has established a marketing compliance management mechanism covering

the entire process—from planning and review to publication—to ensure all content is truthful accurate and objective without

exaggerating product efficacy inducing health anxiety or misleading consumers.

53 54About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth

Creation Management Shared Future

The Company continues to advance its transparent procurement system leveraging a unified SRM (supplier relationship manage-

Supply Chain Management ment) platform to enable end-to-end digital management of suppliers and ensure full traceability. Procurement activities strictly

and Security adhere to the principles of openness fairness impartiality full competition and compliance & integrity ensuring equal access to procurement information for all qualified suppliers. The procurement process is fully traceable and auditable effectively mitigating

risks of improper transactions and enhancing transparency and operational efficiency in procurement management.Case Digital platform empowering transparent procurement and industrial chain collaboration

In accordance with GMP and other applicable laws regulations and industry regulatory requirements the Company has estab-

lished and continuously improved its supplier management system. Through policies including the Supplier Management Regula- To enhance standardization and transparency in procurement and sales and improve industrial chain collaboration

tions Detailed Rules for Supplier Sourcing Management and Management Procedures for Drug Supplier Evaluation Standards it efficiency the Company has advanced its supply chain management through digital transformation establishing an

standardizes key processes—sourcing onboarding collaboration evaluation and exit—providing institutional assurance for the integrated upstream-downstream management system centered on its enterprise-level SRM (Supplier Relationship

security compliance and stable operation of the supply chain. The Board of Directors oversees supply chain strategy; senior Management) system and the SAP Hybris distributor platform. The dual-platform architecture enables seamless data

management coordinates strategic implementation; and the Tendering and Procurement Department is responsible for execution integration across the entire procurement and sales chain offering a unified and open collaborative environment for

including supplier onboarding evaluation and risk control. upstream and downstream small and medium-sized enterprises (SMEs). As of the end of the reporting period the

platforms served over 20000 upstream suppliers and more than 4000 downstream commercial customers with SMEs

accounting for over 90%. Platform adoption has significantly improved operational efficiency: order processing

Information manage- Evaluation and efficiency increased by over 46% procurement cycles shortened by approximately 30% contract signing efficiency Sourcing Onboarding

ment classification rose by 80% and inventory data accuracy reached 99.8%. Through centralized procurement and compliance verifica-

Search for potential Potential suppliers register Maintain unified Conduct regular (at least tion mechanisms the Company has reduced procurement costs minimized inventory accumulation and continuously

suppliers through various and submit qualification supplier master data annually) or ad hoc evalua- enhanced the standardization and security of supply chain operations.channels (e.g. internet documents on the SRM and database informa- tions of qualified suppliers

exhibitions industry platform. After passing tion (potential across multiple dimensions—

associations). review—which may include qualified blacklist) on including quality delivery The Company considers integrity and compliance as a fundamental prerequisite for supplier cooperation strictly adhering to

product testing and on-site the SRM platform. price service and overall national laws and regulations and company policies. It maintains a "zero-tolerance" policy towards commercial bribery and

inspections—they complete capability—and apply improper trading practices. During the bidding and cooperation processes the Company uniformly requires suppliers to sign the

the onboarding process per dynamic classification HARBIN PHARMACEUTICAL GROUP CO. LTD. Bidder Integrity Commitment Letter. Performance under this commitment is

the introduction plan and (strategic leverage routine integrated into the supplier evaluation and management system serving as a crucial basis for continued cooperation. Through

become qualified suppliers. bottleneck) and grading (A institutional constraints and process controls integrity requirements are embedded into key aspects such as supplier onboarding

B C D) based on results. bidding and procurement and contract performance management preventing integrity risks in the supply chain from the source

and ensuring the fairness and compliance of procurement activities.Relationship manage- Performance manage-

Exit and reinstatement

ment ment

Suppliers failing evaluation Establish communication Engage with support and During the reporting period the Company

criteria or encountering mechanisms handle mutual address suppliers experienc-

major issues are removed complaints and provide ing issues in quality delivery

from the qualified supplier support to suppliers with or service (including issuing

list or placed on the blacklist. low ratings. warnings suspending

Reinstatement after exit cooperation downgrading or Achieved ???% signing rate for the Integrity Commitment Letter among bidding suppliers

requires re-completion of the blacklisting).onboarding process.Supplier management process

Supply Chain Risk Management

During the reporting period the Company

The Company embeds risk management into the full-lifecycle management of its suppliers. By controlling access monitoring

Total number of suppliers Proportion of local suppliers Local procurement ratio processes and making dynamic adjustments it systematically identifies and addresses compliance and operational risks within

the supply chain. Prior to cooperation it conducts audits focusing on key requirements such as compliant operations quality and

safety and business ethics to prevent high-risk entities from entering its supply system. During cooperation it continuously

???? ??.??% ??.??% tracks supplier operational performance by integrating fulfillment records issue feedback and audit results and takes timely

management actions in response to evolving risks to prevent their accumulation and spread.

55 56About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability ReportCreation

Chairman Group Sustainability Stable Growth Management Shared Future

Relying on internal audits and special inspections the Company supervises and verifies processes and key risk points related to

Supply chain risk management goals

supplier management. Risks identified through audits are incorporated into subsequent management and improvement cycles

strengthening closed-loop risk prevention and control. By integrating information security and integrity requirements into audit

and process management it ensures the standardization transparency and controllability of supply chain operations. Annual audit coverage for tier 1 suppliers ≥ 95% ESG special audit coverage ≥ 50%

A supplier risk warning response time of ≤ 24 hours

During the reporting period the Company

Conducted document audits for Conducted on-site audits for Had ?? suppliers that underwent and passed

???? suppliers ??? suppliers environmental and social audits Sustainable Supply Chain Management

The Company continues to advance the development of a sustainable supply chain by leveraging policy documents such as the

Supplier Management Regulations and the supplier full-lifecycle management mechanism. It incorporates sustainability require-

ments—including environmental protection product quality work safety labor practices and business ethics—into supplier

onboarding cooperation and evaluation processes. Through policy documents and procurement contract clauses it clearly

defines supplier responsibilities and obligations regarding compliant operations anti-commercial bribery and information protec-

Case tion. Suppliers found to have committed serious legal violations posed quality and safety hazards or demonstrated commercial Construction of GAP bases for core Chinese materia medica at Shiyitang Chinese Medicine dishonesty are subject to restrictions or termination of cooperation in accordance with applicable laws and regulations. During

cooperation the Company integrates factors such as quality and safety performance fulfillment reliability and compliance

To strengthen source-level quality management of the traditional Chinese medicinal materials supply chain and records into supplier evaluation and tiered management using evaluation outcomes to drive corrective actions and continuous

ensure the stability safety and traceability of core Chinese materia medica raw materials Shiyitang Chinese improvement thereby promoting responsible supplier conduct and enhancing management capabilities to steer the supply chain

Medicine focuses on building good agricultural practice (GAP) bases for Chinese materia medica continuously toward greater standardization and sustainability.advancing standardized cultivation and quality control systems for authentic medicinal materials.The Company conducts supplier training centered on sustainable During the reporting period the Company

Shiyitang Chinese Medicine focuses on core varieties including Acanthopanax senticosus Lonicera japonica supply chain management requirements to reinforce understanding

Forsythia suspensa Scutellaria baicalensis and Schisandra chinensis collaborating with multiple Chinese materia and implementation of quality compliance and responsibility

medica cultivation enterprises to jointly build and share GAP bases thereby advancing quality management require- standards fostering supply chain collaboration and enhancing Performed ???supplier

ments upstream to the cultivation stage. Relevant bases have successively passed the GAP compliance extension sustainability capabilities. training sessions

inspections conducted by the Heilongjiang Provincial Medical Products Administration. Among them the cumulative

inspected area for cultivation bases of Lonicera japonica Acanthopanax senticosus Forsythia suspensa and Scute-

llaria baicalensis exceeds 18000 mu achieving controllable sourcing manageable processes and traceable quality

for major Chinese materia medica raw materials.Equal Treatment of Small and Medium-Sized Enterprises

The Company upholds equal treatment of small and medium-sized enterprises (SMEs) in supplier management and procurement

practices. Its bidding and procurement management system explicitly prohibits discriminatory or exclusionary conditions that

restrict SME participation ensuring they enjoy fair competition opportunities in accordance with the law.The Company publicly discloses procurement information via its official website and third-party platforms ensuring all suppliers—

including SMEs—have equal access to procurement information understand procedures and can participate in competitive

bidding. Additionally the Company has established a standardized settlement and payment mechanism and strictly fulfills

contractual payment terms.and sustainable supply chain cooperation ecosystem.GAP cultivation bases

57 58About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for Advance Low-Carbon Appendix 2025 Sustainability ReportGroup Sustainability Stable Growth Creation

to Build a Safe and

Chairman Management Shared Future

Information Security During the reporting period the Company

and Privacy Protection

Conducted attack-defense and emergency response drills

?

Had confirmed data security incidents

The Company continuously enhances its information security and privacy protection governance system by establishing a

dedicated network and information security management organizational structure including a Network and Information Security ?

Leading Group and an Emergency Response Working Group. These bodies coordinate decision-making on major information

security and privacy matters and provide unified command and coordination for emergency responses to cybersecurity incidents Had confirmed customer privacy breach incidents

ensuring orderly and efficient risk response. ?

At the policy level the Company continuously refines its information security and privacy protection framework centered on the Information security skills training

Regulations on the Management of Computer Use and Information Systems which clearly define norms for information system

usage allocation of information security responsibilities and requirements for data access and use—providing institutional assur-

ance for stable system operations and compliant data management. Concurrently the Company strictly implements China's

Cybersecurity Classified Protection requirements organizing filing and assessment activities for its information systems. Its

official website collaborative office system and integrated business-finance system have obtained Level II and Level III Classified

Protection certifications and the Company continuously elevates its overall security posture through third-party evaluations. Medicine Accessibility Enhancement

In technical protection and operational management the Company strengthens cybersecurity defenses and emergency response

capabilities based on the actual operating conditions of its information systems. Through implementing cybersecurity initiatives

conducting attack-defense drills and performing phishing email simulations it continuously assesses system resilience and Governance

employee security awareness promptly identifying and remediating potential vulnerabilities to enhance overall defensive and

incident response capabilities. Medicine accessibility is a key topic in safeguarding public health and well-being and constitutes a core component and critical

practice area of the Company's social responsibility. Its governance level and implementation effectiveness are directly linked to

The Company enforces strict privacy management for customer and patient information. Such information is collected only in the fairness of medical resource allocation the availability and affordability of pharmaceutical services and ultimately the realiza-

legitimate and compliant business contexts and centrally managed through a unified system platform with clear requirements for tion of societal health outcomes. To this end the Company leverages a collaborative mechanism among multi-level governance

data storage access control and confidentiality. Retention dissemination or disclosure of this information in non-work-related bodies to continuously strengthen the governance foundation in medicine accessibility systematically translating governance

contexts is prohibited. Upon personnel role changes or departures the Company strictly enforces information handover and data requirements into actionable measures. Through systematic governance it empowers core objectives such as the decentralization

clearance protocols to ensure information security remains under control. of medical resources and enhanced accessibility of innovative medicines thereby demonstrating its commitment to public health

stewardship.During the reporting period Renmintongtai further revised the Management System and Standard Operating Procedures for

Specialty Pharmacies adding specific patient privacy protection requirements. The revision mandates adherence to the principle

of data minimization in information collection and requires that patients be fully informed—at the time of initial service—about the Strategy

purpose scope retention period and protective measures related to data collection with informed consent obtained accordingly.It also refines standards for data desensitization and strengthens management requirements for information storage use and Risk name Specific description Time horizon1 Financial impact Response measures

transmission thereby further safeguarding patient rights and enhancing service compliance and public trust.Simultaneously the Company continues to strengthen awareness and training on information security and privacy protection by

integrating management requirements into daily workflows through thematic training sessions internal platform communications The drug pricing mechanism is

and cautionary education. During the reporting period it published 42 issues of cybersecurity awareness content and organized Strengthen price influenced by multiple factors—

security awareness and skills training programs focused on information system operations and business scenarios continuously management and market including national centralized Increased revenue

Price

reinforcing the foundational management of information security and privacy protection. Short and monitoring and formulate procurement policies market volatility and greater

instability risk medium term pricing strategies that

competition dynamics and profit uncertainty

align with cost changes

fluctuations in raw material costs—

and market demand

resulting in certain price volatility

1Impact duration refers to the time scope of material impacts on the Company. Short-term: within 1 year; medium-term: 1 to 5 years;

long-term: more than 5 years.

59 60About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for Advance Low-Carbon Appendix 2025 Sustainability ReportGroup Sustainability Stable Growth Creation

to Build a Safe and

Chairman Management Shared Future

Risk name Specific description Time horizon Financial impact Response measures

Case Focusing on full-course disease management to aid patient recovery

The pharmaceutical supply chain In November 2025 the Company hosted a lung cancer

encompasses multiple segments—

Optimize the supply chain patient education event titled "Foreseeing the Future

production warehousing logistics

Decreased sales and channel network and Creating a New Life Together" at its DTP Management

Poor channel and last-mile distribution—with Short and

revenue and higher enhance supply assurance Center attended by 22 patients. A chief physician from a

distribution risk uncertainties in channel coordina- medium term

operating costs for key regions and critical tumor hospital was invited as the keynote speaker to

tion and delivery efficiency; supply

products

assurance capacity in certain share professional insights on key aspects of full-course

regions requires improvement disease management helping patients and their families

develop a scientifically informed understanding of the

condition. The event included one-on-one consultation

sessions to facilitate discussions between patients and

healthcare providers about treatment concerns. In collab-

oration with physicians the pharmacy established a

Opportunity type Specific description Time horizon Financial impact Response measures fast-track consultation channel to streamline follow-up

procedures and address access barriers. This event

provided professional guidance and services created a

Exclusive patient education event

platform for doctor-patient communication and support- for lung cancer patients

Evolving public health needs and ed standardized treatment and long-term health manage-

growing demand for affordable

Advance product portfolios ment for lung cancer patients.highly adaptable medicines in Increased revenue

Pharmaceutical tailored for grassroots and

grassroots and emerging markets Long-term and higher cash

innovation emerging markets and

continue to expand product inflows

enhance market coverage

application scenarios and market In 2025 the Company further deepened its "Internet + Pharmaceutical Health" service model with a core focus on enhancing

opportunities medication purchasing convenience and upgrading health service experiences. It comprehensively optimized and scaled its O2O

business system across chain stores. Leveraging the physical advantages of its offline store network and the technological

enablement of its digital platforms the Company successfully established an integrated "online + offline" service loop efficiently

meeting consumers' health and medication needs across all times and scenarios significantly expanding service reach and

response efficiency.Access Channels

Case Empowering science communication upgrades through expert livestreaming to improve public health literacy

The Company has deep expertise in the pharmaceutical distribution sector and has built an efficient province-wide delivery

network leveraging high-quality channel resources supported by strong market coverage and marketing capabilities. It has estab- In July 2025 the Marketing Company built a nutrition

lished a comprehensive terminal customer coverage system encompassing graded hospitals primary healthcare institutions and popular science platform via short videos. Aiming at

retail pharmacies. Long-standing cooperative relationships with key medical institutions and commercial clients are reinforced public dietary misunderstandings and nutritional

through continuous service quality improvements. In its retail segment the Company focuses on refined operations and optimized needs it converted professional nutritional knowledge

layout of directly operated stores while utilizing DTP specialty pharmacies1 and hospital-adjacent stores as key channels to into accessible and widely-spreadable content to lower

capture prescription outflow delivering professional and standardized pharmaceutical services to consumers. the public’s threshold for acquiring health knowledge.To guarantee content quality a special team was estab-

As of the end of 2025 the Company operated 357 directly managed retail stores including 226 stores in Harbin and 131 stores lished for content planning and production based on

outside the city. The Company had a total of 15 DTP specialty pharmacies to better meet patients’ medication needs. The DTP basic nutrition and real-life scenarios. Up to now over

pharmacies cumulatively served 250000 patients with follow-up services covering nearly 190000 visits. 40 nutrition popular science short videos have been

released attracting more than 60000 user interac-

tions which has effectively expanded popular science

coverage and improved public health literacy.

1DTP pharmacies (Direct to Patient) refer to specialized pharmacies through which pharmaceutical manufacturers or distributors provide prescription

drugs—primarily specialty and innovative medicines—directly to patients. Employee Live Broadcast Column

61 62About This Message About 2025 Key Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in

Sustainability Special Topic to Solidify a Foundation for Product System for Value Management Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability ReportCreation

Chairman Group Sustainability Stable Growth Management Shared Future

Inclusive Healthcare Impact Risk and Opportunity Management

Product pricing basis

The Company systematically identifies and manages impacts risks and opportunities related to medicine accessibility in pursuit

of its goal to ensure public access to essential medicines. Considering evolving policy landscapes market feedback and opera-

The Company adopts a market-oriented pricing mechanism conducting nationwide competitive price surveys to tional performance it continuously monitors factors—including drug price volatility supply channel efficiency and coverage in

systematically understand market price baselines and regional patient affordability thresholds. Combined with grassroots and remote areas—that may affect medicine availability and affordability. Comprehensive assessments are conducted

full-chain cost accounting of product manufacturing it aligns pricing with market realities and ensures patient across dimensions such as patient affordability supply reliability and service reach. For key identified risks the Company imple-

affordability fulfilling its corporate mission. ments ongoing management through pricing justification channel network optimization and service model enhancements

supported by dynamic tracking via operational data and market insights. While mitigating accessibility risks it seizes opportuni-

ties arising from innovative drug adoption channel expansion into lower-tier markets and service model innovation driving more

equitable and effective delivery of pharmaceutical resources to meet societal needs.Pricing data and changes for key products

Pricing of the key product Nao An Pian from Hayao No.6 Factory follows centralized procurement policy guidance.In 2023 it was successfully awarded a contract in the National Traditional Chinese Medicine Procurement Alliance's Indicators and Objectives

volume-based procurement program with winning bid prices of RMB 22.41 per box (24-tablet pack) and RMB 33.12

per box (36-tablet pack)—a 17% reduction that effectively alleviates patient medication costs. This price has been Target

progressively implemented across provinces since September 2023. Following the completion of a new bidding

round in 2025 the same price remains in effect nationwide strongly supporting inclusive pricing objectives.Launched products are timely registered on provincial procurement platforms nationwide to achieve

Fair pricing strategy

rapid terminal sales coverage at all levels of medical and health institutions across the country.A comprehensive pricing justification mechanism has been established covering analysis of market competition

dynamics competitive price benchmarking invoicing price calculation and compliance validation. Through multi-di-

mensional systematic review pricing strictly adheres to national pharmaceutical pricing policies while maximizing

patient benefits effectively reducing financial burdens and reflecting a commitment to inclusive health access.The Company actively participates in national volume-based procurement and relevant policies includ-

ing the "Three Entries" initiative. It effectively improves public access to medicines and reduces

Case Responding to the hierarchical diagnosis and treatment policy to help enhance medication accessibility residents’ economic burden of medical treatment and medication.Promoting hierarchical medical care and improving access to medicines at grass-

roots level has been a top priority of China’s medical and health work in recent

years. The state has continuously introduced relevant policies including incorpo-

rating village clinics into medical insurance pooling advancing the "Three Entries"

of centralized procurement improving compact county medical communities and

realizing grassroots medication linkage.The Company deeply participates in national volume-based procurement and the

National Chinese Patent Medicine Alliance Procurement. Its products have been

selected in multiple batches of such procurement projects. The substantially

reduced selected prices effectively meet the medication demands of medical

institutions and ease patients’ medication burden.Regarding the "Three Entries" policy the Company actively applies for relevant

product listings. Nao’an Tablets Fosfomycin Sodium for Injection Ceftriaxone

Sodium for Injection Cefazolin Sodium for Injection and Cefradine Capsules have

been included in the provincial "Three Entries1" catalogues of multiple regions.

1Refers to the access of centralized-procurement medicines to grassroots medical institutions private medical institutions and retail pharmacies.

636403

Green Operations to

Advance Low-Carbon

Management

The content of this chapter

Environmental Compliance Management ??

Climate Change Tackling ??

Energy and Resource Management ??

Pollutant Emissions ??

Waste Management ??

Ecosystem and Biodiversity Conservation ??About This Message About 2025 Key Governance and Compliance Green Operations to

from the Hapharm Performance in

Sustainability Special Topic to Solidify a Foundation for Product System for Value

Employee Development

Report Management Advance Low-Carbon Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation

to Build a Safe and

Management Shared Future

Environmental Compliance Management Case The Company’s organization of specialized environmental protection training to strengthen the green compliance line of defenses

In September 2025 the Company led a specialized

The Company strictly complies with relevant laws and regulations including the Environmental Protection Law of the People's environmental protection training session involving

Republic of China the Law of the People's Republic of China on the Prevention and Control of Environmental Pollution by Solid relevant personnel from its subsidiaries with a total of 30

Waste the Air Pollution Prevention and Control Law of the People's Republic of China and the Water Pollution Prevention and participants. This training was closely aligned with the

Control Law of the People's Republic of China. It has formulated and implemented the Hapharm Group Environmental Protection current severe environmental regulatory situation and

Management Measures. The Company continuously advances pollution prevention and control efforts to ensure stable and precisely met the Company's actual needs for environmen-

compliant emissions of all pollutants. With a core focus on fulfilling its primary environmental responsibilities and strengthening tal management. The content covered core modules such

end-to-end supervision it steadily progresses in building a green manufacturing system. Its subsidiary Sanjing Mingshui was as in-depth interpretation of environmental laws and

awarded the National Green Factory designation in 2024. regulations analysis of typical environmental violation

cases practical methods for corporate environmental

The Company has established a tiered environmental management responsibility system designating the principal executives of self-inspection and emergency response plans for

each subordinate production enterprise as the primary persons accountable for environmental protection. It centrally coordinates environmental incidents. The training effectively strength- The Company's environmental protection training

annual internal audits of the environmental management system and maintains end-to-end oversight to ensure responsible ened the environmental compliance awareness and sense

entities complete closed-loop corrective actions for any weaknesses or risks identified guaranteeing the system's sustained and of responsibility of the participants from all subsidiaries

high-quality operation. systematically enhancing their capabilities in environmen-

tal risk identification hazard investigation and emergency

The Company has formulated and issued the Emergency Response Plan for Environmental Emergencies aiming to effectively response laying a solid foundation for the Company to

respond to environmental emergencies triggered by various production safety accidents and natural disasters. This plan is continuously strengthen its environmental management

designed to prevent the diffusion of pollutants and toxic and hazardous substances into the atmosphere water bodies soil and line of defense and achieve green and compliant opera-

other environmental media outside the plant boundaries thereby minimizing the negative impact on the environment. At the same tions.time the Company organizes environmental protection training conducts emergency drills and establishes an effectiveness

evaluation mechanism to ensure the operability and effectiveness of the plan. Additionally the Company continuously improves

its long-term environmental management mechanisms regularly carries out environmental hazard investigation and rectification

work ensures effective investment in hazard rectification funds and prevents the occurrence of environmental risk incidents. Climate Change Tackling

During the reporting period the Company Governance

Conducted??emergency drills for environmental risk incidents The Company deeply implements the national "dual carbon" strategic deployment incorporating climate change tackling into its

core corporate governance and steadily promoting energy conservation and carbon reduction efforts based on its existing

Organized????participants for emergency drills of environmental risk incidents management structure. In terms of carbon emission governance the Company has established standardized working mechanisms

for Scope 1 and Scope 2 carbon emission inventories. It conducts comprehensive inventories and precise accounting according

Conducted ??environmental management training sessions to a set cycle while simultaneously sorting archiving and verifying carbon emission data to ensure its authenticity and traceabili-

ty. Simultaneously it dynamically optimizes energy conservation and carbon reduction management measures based on the

Conducted environmental management training with a total duration of ???? hours inventory results promoting the effective integration of governance requirements with all aspects of production and operation

and continuously enhancing its governance effectiveness in response to climate change.Conducted environmental management training with an average duration of ?.?? hours per person

Organized????participants for environmental management training

Organized???participants for environmental protection publicity and public welfare activities

Invested RMB??.????million in environmental protection

?Scope ? refers to direct GHG emissions from sources owned or controlled by the Company mainly including boiler combustion vehicle exhaust etc.;

Scope ? refers to indirect GHG emissions from the generation of purchased and consumed external energy such as electricity steam heat and

cooling.

67 68About This Message About 2025 Key Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in

Sustainability

Management Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation Management Shared Future

Strategy

Risk type Specific description Time horizon Financial impact Response measures Specific description Specific description Time horizon Financial impact Response measures

Integrate extreme weather

risks into operational and Align with evolving

Production

emergency management market demands and

Extreme weather events may Emerging disease prevention stoppage

systems enhance production business strategy

disrupt production sched- needs and public health Extreme Short and losses and

continuity safeguards and Revenue growth continuously monitor

weather ules and logistics arrange-

Emerging market challenges driven by climate

medium term increased Long-term

contingency plans and and expanded climate-related health

ments opportunities change may stimulate demand operating costs

strengthen risk identification market share trends and drive a for related therapies and

and response capabilities for rational portfolio layout products

Phys- critical nodes

of products and

solutions

ical

risks

Enhance energy consumption

Rising ambient temperatures

Higher energy analysis and cold chain

Increase in impose stricter requirements

costs and operations management

annual on temperature control and

Long-term increased promote energy-saving The Company focuses on strengthening its management foundation through capacity building. In response to climate change-re-

average cold chain management across

operating technologies and equipment

temperature production storage and lated risks and emission reduction requirements and in line with its production and operational realities the Company organizes

expenses optimization and improve

transportation relevant training to deepen the understanding of climate change topics and related compliance requirements among management

energy efficiency personnel and employees in key positions thereby enhancing their ability to identify and respond to climate-related risks in daily

management.Continuously monitor

evolving climate and

Carbon emissions and energy

environmental policies

management regulations are Increased

integrate relevant require- Case Participating in special topic training on energy conservation and carbon reduction to progressively tightening compliance

Medium and enhance low-carbon management capabilitiesments into environmental

Policy risk subjecting the company to costs and

long term management and business

heightened compliance higher capital

decision-making processes In 2025 the Company organized relevant

obligations and management expenditures

and proactively plan energy personnel to participate in a special topic

pressure

conservation and carbon training on energy conservation and carbon

reduction initiatives reduction held by the relevant departments of

Songbei District Harbin City Heilongjiang

Conduct technical Province. The training centered on the require-

Higher assessments and phased

Existing energy equipment ments of the "dual carbon" goals systematically

investment in optimization of energy

and production facilities explained basic energy theories energy

Tran- equipment equipment and production

Technology face pressure to upgrade to Medium and consumption indicator accounting methods and

sition upgrades and facilities implement

risks meet current energy long term key points of carbon peak and carbon neutrality

Risk increased energy-saving retrofits

efficiency and emission

depreciation aligned with operational policies helping participants to enhance their

standards

expenses realities and enhance asset understanding of the policy requirements and Special topic training on energy conservation

utilization efficiency implementation paths for energy conservation and carbon reduction

and carbon reduction.Strengthen environmental

Environmental governance

management and disclo-

and climate response

sure continuously advance

performance attract Higher

energy conservation

Reputational heightened attention from the Short and financing costs

carbon reduction and At the same time the Company focuses on optimizing its energy structure in the production and operation process. It explores

risk public and investors medium term and reduced

environmental compliance the application of clean energy sources such as photovoltaic power generation based on its energy consumption conditions. By

increasing corporate revenue

practices and enhance increasing the proportion of renewable energy source usage it gradually reduces the emission pressure brought by traditional

reputation management

external transparency and energy consumption.pressure

management credibility

69 70About This Message About 2025 Key Hapharm Performance in Sustainability

Governance and Compliance Green Operations to Employee Development

Report from the Management Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation Management Shared Future

Case Photovoltaic power generation project at the Second Chinese Medicine Factory Energy and Resource Management

To reduce energy consumption intensity and GHG

emissions during operations the Company advanced

the construction of a photovoltaic power generation Energy Utilization

project at its Second Chinese Medicine Factory and

connected it to the grid. Since its commissioning the

project has operated stably overall and the substitution In accordance with the Energy Law of the People's Republic of China the Company has formulated and issued the Hapharm Group

effect of clean energy has gradually become apparent. Energy Management Measures establishing a standardized energy management system. On this basis the Company coordinates

During the reporting period the photovoltaic system its subsidiaries to advance energy management work implements full-process supervision inspection and assessment of their

generated a total of 500200 kWh of electricity provid- performance guides special actions for lean energy conservation and strengthens key matters such as internal audits of energy

ing practical support for the Company's efforts to management.address climate change and optimize its energy Photovoltaic panels at the Second

structure. Chinese Medicine Factory

Each subsidiary of the Company has formulated energy management systems

which include content related to energy procurement use conservation and

Impact Risk and Opportunity Management evaluation.The Company integrates climate change-related impacts risks and opportunities into a unified environmental and operational

management framework continuously conducting systematic identification and dynamic management. Through energy use analy- The Company establishes energy consumption ledgers and conducts energy use

sis and production operation assessments the Company identifies the potential impacts of factors such as extreme weather analysis. The Company records and tabulates actual energy consumption daily

temperature changes policy tightening and technological iteration on production operations cost structure and supply chain performs summary analysis periodically to promptly identify anomalies in energy

stability and conducts comprehensive evaluations based on the degree of impact and frequency of occurrence. Based on the consumption finds the causes and formulates solutions.evaluation results the Company continuously optimizes its energy conservation and carbon reduction management measures

integrates relevant requirements into production operations and management decision-making processes and strengthens

continuous control over climate-related risks through data monitoring and capacity building. While effectively preventing environ-

mental and compliance risks the Company also focuses on new health demands and market expansion opportunities brought by The Company strengthens management and control by establishing energy

climate change promoting synergy between environmental management and business development. consumption quotas for production lines. Data on energy consumption for more

than ten eligible production lines is accumulated quotas are established and

these quotas are continuously optimized based on actual usage.Indicators and Objectives

At the current stage the Company's carbon management focuses on Scope 1 and Scope 2 emissions and is steadily incorporating The Company enhances monitoring of high-consumption equipment. Metering is

Scope 3 emissions into its control system. It has already initiated the identification of core emission sources specifically covering added to some high-energy-consuming equipment a monitoring system is estab-

carbon emissions generated from employee commuting business travel the production of purchased raw materials and product lished data on equipment energy consumption is collected energy use trends are

transportation processes. analyzed and operating statuses are reasonably adjusted to ensure efficient

operation.Indicator name1 Unit 2025 data

Scope 1 greenhouse gas emissions Tonnes of CO equivalent ?????.?? 1.The Company strengthens energy use inspections to reduce energy waste. Daily 2

inspections are conducted on the energy preparation transmission and distribu-

tion systems to prevent leaks drips and spills thereby reducing energy waste.Scope 2 greenhouse gas emissions Tonnes of CO2 equivalent ??????.??

Total greenhouse gas emissions Tonnes of CO2 equivalent ??????.?? The Company's energy use management measures

1The Company calculates its greenhouse gas emissions mainly in accordance with relevant standards and methodologies of the GHG Protocol and conducts

measurement in combination with relevant national and industrial regulations.

71 72About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation Management Shared Future

Case Strengthening internal energy audit and control to solidify the foundation for energy conservation Case Upgrading the automatic control of the heating system to reduce steam consumption and and cost reduction increase efficiency

In 2025 the Company systematically conducted The original heating systems in some workshops

internal energy audits on-site special inspections of Harbin Pharmaceutical General Factory were

and energy conservation awareness campaigns for incapable of temperature adjustment. Constant

its subsidiary production enterprises. Weaknesses heating was still maintained during non-produc-

in energy management were identified and tion hours at night resulting in energy waste. In

addressed resulting in a total of 35 energy-saving 2025 the factory installed a new automatic

improvement recommendations being issued. In control system which can automatically adjust

October of the same year the Company held a heating parameters according to preset tempera-

special meeting on energy management. Through a tures and time periods thus effectively improving

systematic review of the effectiveness and short- energy utilization efficiency. According to estima-

comings of the internal audit work and specialized tion the renovation will reduce annual heating Addition of an automatic control system for the

training sharing practical ideas for energy-saving heat exchange stationsteam consumption by approximately 540 tons.renovation projects the Company comprehensively Energy internal audit training

enhanced its level of refined energy management

helping to achieve the strategic goals of energy

conservation cost reduction and efficiency

improvement.Green Office

The Company continuously promotes green office management in its daily operations. By advocating paperless offices online

Case Upgrading drying equipment heaters to achieve dual improvements in energy efficiency and production capacity meetings conservation of electricity and water and recycling of office supplies it reduces resource consumption and unneces-

sary energy waste. At the same time considering the operational characteristics of its office spaces the Company explores the

In January 2025 Shiyitang Chinese Medicine application of energy-saving technologies in office buildings while ensuring a comfortable and stable working environment gradu-

completed the upgrade and renovation of its fluid ally improving the energy utilization efficiency of its office operations.bed dryer heater. Following the renovation the

drying efficiency of the equipment was significantly

improved; the single-batch operating time of the

fluid bed dryer in the drug granulation process is

expected to be reduced by two hours achieving the

Case Green operation practices for office buildingsdual goals of enhancing energy efficiency and

increasing production efficiency. This renovation

effectively improved equipment operating efficiency To respond to national energy conservation and emission reduc-

and reduced production energy consumption. tion policies and improve the heating efficiency of its office

During the reporting period it saved a cumulative building the Company implemented a smart heating energy-sav-

Upgrading and renovation of the fluid bed dryer heater

total of 23000 kWh of electricity and 76.8 tonnes ing renovation project piloting it at its headquarters office

of steam accumulating practical experience for the building and associated heat exchange station. The project

Company's future energy-saving optimizations in achieved refined management and dynamic adjustment of heating

production processes. operations through measures such as independent operation

renovation of the heating system optimization of the secondary

pipe network online monitoring of indoor temperatures and

upgrading of heat metering methods. This effectively improved

heating quality and avoided energy waste. Since the project's

completion and stable operation it has saved approximately 150

tonnes of standard coal annually reduced carbon dioxide

emissions by about 540 tonnes and simultaneously lowered

emissions of nitrogen oxides sulfur dioxide and particulate Smart heating energy-saving

matter playing a positive role in mitigating climate change and renovation project

improving regional environmental quality.

73 74About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation Management Shared Future

Case Practicing the concept of green travel and deepening energy conservation and Water Resource Utilizationemission reduction practices

In January 2025 in response to the national policy orientation of The Company strictly adheres to relevant national and local laws regulations and policies systematically promoting the refined

energy conservation and emission reduction and in light of the management of water resources. Upholding the principles of scientific management and continuous improvement the Company

operational demands of cost reduction and efficiency improve- focuses on the core goals of efficient and intensive use of water resources cost reduction and efficiency improvement. By

ment the Company officially launched the special program for the strengthening control measures throughout the entire water usage process it achieves the dual effects of resource protection and

new energy replacement of official vehicles. The Company waste elimination.replaced 11 fuel vehicles approaching the end of their service life

under itself and 9 affiliated enterprises with domestic hybrid The Company strengthens the daily operation maintenance and control of water-using equipment conducting targeted inspec-

models. The carbon emission per vehicle decreased by approxi- tions and rectifying problems to reduce water resource waste from leaks drips and spills. In its production and operation process-

mately 40% year-on-year which effectively facilitated the enter- The Company's new energy official vehicles es the Company utilizes a circulating water system achieving the dual goals of reducing water consumption and improving utiliza-

prise’s green and low-carbon transformation process and tion efficiency through optimized water resource allocation. Additionally on the annual environmental protection and water

accumulated replicable and generalizable practical experience for conservation day the Company conducts water-saving publicity and education in various forms to raise employee awareness

the Company to achieve its dual carbon goals. laying a solid foundation for building a water-saving enterprise and promoting corporate sustainability.Key performance

Key performance

Category Indicator Unit 2025 data

Indicator name Unit 2025 data

Direct energy consumption Tonnes of standard coal 15778.58

Total water consumption Tonnes 6320252

Gasoline consumption Tonnes 116.71

Diesel consumption Tonnes 84.84 Freshwater consumption Tonnes 1074961

Natural Gas Consumption 10 Thousand Cubic Meters 1164.15

Recycled water consumption Tonnes 11454932

Energy Indirect energy consumption Tonnes of standard coal 31201.88

usage Water consumption intensity

per million in revenue Tonnes/RMB 1 million in revenue 395.91

Purchased electricity MWh 58192.01

Purchased Steam GJ 704867.68

Total energy consumption Tonnes of standard coal 46980.46

Comprehensive energy consumption per Tonnes of standard

unit of revenue coal/million 2.94

Total clean energy consumption Tonnes of standard

(photovoltaic natural gas) coal 16070.24

Clean Solar energy consumption (photovoltaic) MWh 4784.65

energy

Proportion of clean energy consumption to total energy

consumption % 34.21

75 76About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in

Product System for Value

Management Special Topic to Solidify a Foundation for Advance Low-Carbon Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation

to Build a Safe and

Management Shared Future

Pollutant Emissions Exhaust Gas Management

As a pharmaceutical enterprise committed to environmental responsibility the Company strictly complies with core regulations

Wastewater Management such as the Environmental Protection Law of the People's Republic of China and the Air Pollution Prevention and Control Law of

the People's Republic of China systematically advancing waste gas management. The Company's waste gas primarily consists of

process emissions originating from basic production steps such as crushing and packaging as well as core processes including

The Company strictly adheres to the requirements of laws and regulations such as the Environmental Protection Law of the active pharmaceutical ingredient synthesis and solvent recovery. Its characteristic pollutants are mainly particulate matter and

People's Republic of China and the Water Pollution Prevention and Control Law of the People's Republic of China to carry out volatile organic compounds.full-process wastewater management. Each subsidiary is equipped with a standardized wastewater treatment station and profes-

sional technicians dedicated to process parameter control and system operation management ensuring that treated wastewater

meets discharge standards consistently. The management of production wastewater fully implements the core control principle of

"separating clean water from wastewater treating wastewater based on its quality and ensuring compliant discharge." Key performance

Indicator name Unit 2025 data

Case Building a standardized sewage station to control emissions and treat pollution

Total waste gas Cubic meter 21560.51

Sanchine has constructed its own wastewater treatment station with

a daily capacity of 3200 tonnes utilizing the sequencing batch

reactor (SBR) activated sludge process for wastewater pretreatment. Particulate matter (PM) Tonnes 2.55

The treated effluent quality consistently meets the requirements of

the Discharge Standard of Water Pollutants for Pharmaceutical

Industry Mixing/Compounding and Formulation Category before Sulfur oxides (SOx) Tonnes 0.48

being discharged into municipal sewage treatment plants via the

municipal pipe network. Sanchine strictly adheres to technical speci- Nitrogen oxides (NOx) Tonnes 18.82

fications in configuring and upgrading online wastewater monitoring

facilities while also commissioning third-party professional monitor-

ing agencies to conduct regular testing of wastewater pollutants at Wastewater treatment station Volatile organic compounds (VOCs) Tonnes 172.61

the plant boundary. By real-time monitoring of discharge data

precise control of pollution control facility operations and continu-

ous optimization of treatment processes the Company enhances the

effectiveness of its pollution control efforts.Noise Management

Key performance

The Company strictly adheres to the relevant requirements of the Law of the People's Republic of China on the Prevention and

Control of Noise Pollution to implement noise control measures upholding the governance principle of "source control and

Indicator name Unit 2025 data transmission path sound insulation." In equipment selection priority is given to low-noise facilities to minimize noise generation

at the source. For high-noise equipment such as air compressors and fans independent soundproof rooms are provided. Produc-

Total amount of wastewater discharge Tonnes 1052611 tion pipelines are treated with flexible connections and sound-insulating wrapping to reduce noise transmission. Additionally

green belts are planted along the plant boundaries to create natural noise barriers. Through these targeted control measures the

Company effectively implements noise governance requirements ensuring harmonious coexistence between the production

Chemical oxygen demand (COD) Tonnes 38.86 environment and the surrounding area.Ammonia nitrogen (NH?-N) Tonnes 1.28

77 78About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation Management Shared Future

Waste Management Classified Standardized Compliant

storage transportation disposal

The Company strictly complies with regulations such as the Law of the People's Republic of China on the Prevention and Control

of Environmental Pollution by Solid Waste and the Regulations on the Management of Municipal Solid Waste to carry out waste 1 2 3

management. Aligning with the characteristics of the pharmaceutical sector it also implements the requirements of the Measures Strict implementation Internal transporta- Recyclable waste is

for the Administration of Hazardous Waste Transfer. Guided by the core policy of "reduction resource recovery and harmless of zoned and tion utilizes dedicat- processed by

disposal" the Company has established a tiered management system encompassing "source reduction—recycling—end-of-pipe classified storage ed sealed containers compliant renewable

harmless disposal" and implemented a standardized closed-loop process of "classified storage—standardized transportation— management and transport resource units while

compliant disposal." specifications is vehicles while non-recyclable

carried out fulfilling external transporta- hazardous waste is

the "four prevention" tion of hazardous disposed of

Reduction requirements of

measures By optimizing processes to improve packaging efficiency and reduce material loss the generation of

waste is entirely harmlessly in

anti-seepage

waste and discarded packaging materials is minimized at the source. entrusted to units accordance with laws

anti-loss anti-disper- possessing road and regulations.sion and rain transport permits and

protection while hazardous waste

simultaneously disposal qualifica-

Resource equipping emergency tions;

recovery and material reserves;

utilization For high-concentration waste solvents priority is given to recovery and purification through processes

such as distillation and rectification followed by reuse in production processes to reduce hazardous

waste generation. The Company's waste disposal process

General Waste Management

Harmless

disposal Non-recyclable hazardous waste is managed by category according to its hazardous characteristics

and entrusted to qualified professional institutions for harmless disposal. The Company's general waste mainly includes domestic waste generated by employees office paper waste used packaging

materials and food waste. The Company implements classified collection and standardized storage for general waste entrusting

legally qualified third-party units for removal and disposal to ensure that the disposal process is compliant safe and orderly. At

the same time by promoting continuous flow production and optimizing production organization methods the generation of

The Company's waste management policy

general waste and pollutants is reduced.Hazardous and Medical Waste Management

The Company's hazardous waste mainly includes laboratory waste liquid waste ion exchange resins non-conforming products

and laboratory waste. All types of hazardous waste are strictly managed by category in accordance with the National Catalogue of

Hazardous Wastes and incorporated into the unified hazardous waste management system according to pharmaceutical industry

hazard categories (e.g. HW02 HW49).The Company implements the principle of "strict management" for hazardous waste clarifying the responsibility requirement of

"who pollutes who treats." Through systems such as the Environmental Protection Management Measures Hazardous Waste

Management Measures and Emergency Response Plan for Environmental Emergencies the Company standardizes the manage-

ment of the entire process of hazardous waste generation collection storage transfer and disposal.

79 80About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation Management Shared Future

Specific operational procedures include: Key performance

Hazardous waste is centrally collected in the production system and quality inspection workshops and then transferred to

the temporary hazardous waste storage room;

The temporary storage room is constructed in accordance with the Standard for Pollution Control on Hazardous Waste Indicator name Unit 2025 data

Storage and implements classified management with clear and conspicuous hazard signage;

For off-site disposal all hazardous waste is entrusted to professional units holding a Hazardous Waste Operation License Total hazardous waste Tonnes 210.46

to complete reception and compliant disposal within a fixed timeframe.Hazardous waste intensity Tonnes/RMB 1 million in revenue 0.01

Total non-hazardous waste Tonnes 2075.38

To ensure employee safety the Company requires strict adherence to personal protective equipment requirements during the Non-hazardous waste intensity Tonnes/RMB 1 million in revenue 0.13

sorting transfer and temporary storage of hazardous waste. Additionally designated positions fixed schedules and defined

routes are implemented to minimize secondary pollution and safety risks.Waste recycling rate % 91.42

During the reporting period the Company

During the reporting period ???% of the waste generated by the Company was disposed of in compliance

with regulations with no incidents of illegal discharge or transfer occurring. Ecosystem and Biodiversity Conservation

The Company places high importance on the interrelationship between raw material sources production activities and the natural

ecological environment. While complying with national laws and regulations on ecological and environmental protection the

Company continuously identifies potential impacts of its business activities on ecosystems and biological resources. It prudently

advances risk prevention control and management related to biodiversity striving to reduce adverse environmental impacts while

ensuring stable production and operation.Case Closed-loop reclamation of organic solvents to improve quality and efficiency in resource utilization

The Company integrates ecological and environmental protection concepts into its planting and management processes. By

In the synthesis workshop organic solvents are prioritized for regularly monitoring and assessing soil conditions in planting areas and tracking changes in soil physicochemical indicators the

cooling circulation and reuse within the production process. Company prevents potential impacts on soil ecology caused by improper planting or input usage promoting the coordinated

When concentrations fall below usage standards they are development of Chinese materia medica production and the local ecological environment.transported via pipelines to the solvent reclamation workshop

for purification before being returned for reuse. The solvent

reclamation workshop primarily handles the reclamation of

various organic solvents from the synthesis workshop and the

sterile API workshop with main products being reclaimed

anhydrous ethanol and industrial ethanol. For other organic

solvents reclaimed from the synthesis workshop the Sanjing

Mingshui workshop periodically conducts negative pressure

distillation and reclamation in a multi-functional tower. Qualified

products are sent to finished product tanks while non-conform-

ing products are temporarily stored in intermediate tanks for

Solvent reclamation workshop

reprocessing. This entire process maximizes resource utiliza-

tion minimizes losses and ensures the quality of reclaimed

products. Throughout the year a total of 50 tonnes of ethanol

and 10 tonnes of ethylene glycol were saved.

818204

Employee Development

to Build a Safe and

Shared Future

The content of this chapter

Employee Rights and Care ??

Talent Cultivation and Development ??

Occupational Health and Safety ??

Rural Revitalization Practices ???

Public Welfare and Social Action ???About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for Advance Low-Carbon Creation to Build a Safe and

Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Management Shared Future

Opportunity type Specific description Financial impact Response measures

Employee Risks and Opportunities Time horizon

A comprehensive human resource Continuously optimize the

management system has been human resource manage-

established. Through measures such ment system improve

Focusing on employee team stability and organizational sustainability goals the Company systematically identifies and assesses as strengthening institutional career paths build a

employee-related risks and opportunities integrating management requirements into human resources management and daily guarantees deepening training and full-cycle training system

operational processes. In conjunction with business development plans and the actual workforce situation the Company continu- development and optimizing Talent Medium and and a fair and reasonable

compensation and incentives the

ously evaluates the potential impacts of factors such as talent mobility person-job fit and occupational health implementing retention long term compensation system

Company aims to achieve sustainable

dynamic monitoring and response through existing management mechanisms. empower sustainable talent

talent career development reduce the development and solidify

turnover rate of core talent and the foundation for talent

ensure the inheritance of organiza-

Reduced retention.Risk type Specific description Time horizon Financial impact Response measures tional experience and the continuous Employ- stable development of the business. recruitment

ment and training Strengthen promotion and Deepen school-enter-

costs and publicity of the employer

Influenced by objective factors such as prise cooperation to oppor-

tunities improved labor brand fully showcase the Harbin's geographical location and broaden channels for Through standardized employment efficiency Company's compliant

regional economic development levels talent attraction and

Rising labor practices and caring initiatives the employment practices and

Regional some high-quality talent exhibits lower cultivation; strengthen Employer

Employ- costs and Company continuously enhances its employee care initiatives

recruitment job-seeking willingness leading to Short and employer brand building brand Medium and

ment declining employer brand influence and market actively participate in

disadvantag- certain recruitment pressures for the medium term by highlighting the enhance- long term

risks workforce reputation attracting high-quality industry employer brand

es Company and constraining the Company's develop- ment

productivity talent and creating a positive talent awards and continuously

efficiency and progress of personnel ment platform and siphon effect. enhance brand influence

replenishment. career stability to and reputation.continuously enhance

talent attraction. Open up professional Clear and smooth career development

promotion channels for

Examples include fire and paths are established and diversified R&D personnel establish

explosion risks associated with incentive mechanisms are improved to

Fire and innovation incentives and Short and

chemicals as well as fire hazards Stimula- fully stimulate employee innovative Revenue growth

explosion Talent special awards encourage medium term

arising from the indoor storage of tion of vitality and creative enthusiasm. Medium and and enhanced cultiva- employees to participate in

diesel generators. innovative Technological breakthroughs and long term workforce tion challenging projects and

vitality management innovation are promoted productivity

cross-departmental

Increased asset Strengthen control to continuously enhance the collaboration and foster a

losses production over fire safety Company's core competitiveness.Examples include distribution boxes positive and upward-look-

stoppage losses mechanical

Safety Electric in the water supply pump room of Short and ing innovation culture.compensation equipment safety

risks shock the power workshop which may medium term expenses and devices and Implement annual

cause electric shock injuries.emergency personnel safety employee physical

response costs behaviors. The working environment and examinations and

occupational health management are occupational health

continuously optimized to effectively monitoring optimize labor

Health Employee

protect the physical and mental health Medium and Lower medical protection equipment and

Examples include risks of mechani- protec- health and absentee-

Mechanical Medium and of employees reduce sick leave long term establish caring facilities

cal injury in production packaging tion protection

injury long term absentee rates and further enhance

ism costs such as mother-and-baby

and maintenance positions. employee loyalty and work engage- rooms and fitness activity

ment. areas to promote humanis-

tic care-based safety

management.Dust and Dust hazards may be generated

Short and

chemical during sub-packaging in

medium term Higher medical Strengthen control Occu- hazards production workshops. expenses reduced over equipment and

pational

workforce produc- facility sealing and

health

tivity and increased personnel protection

risks Noise hazards may be generated

Short and related management.Noise by air conditioning systems in

medium term

production workshops.

85 86About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation Management Shared Future

The Company has established a comprehensive compensation and performance grievance mechanism clearly defining channels

Employee Rights and Care procedures and time limits to protect the legitimate rights and interests of employees. Regarding compensation employees may

file a grievance within 30 days of the salary payment date if they have objections. For performance employees may submit a

grievance application to the Performance Management Office within five working days after the announcement of assessment

results which will investigate and rule accordingly. Grievance channels include offline feedback email systems and union

The Company strictly complies with national laws and regulations such as the Labour Law of the People's Republic of China and channels ensuring that employee concerns are handled in a timely and fair manner.the Labor Contract Law of the People's Republic of China adhering to the principles of legal employment and standardized

management and resolutely prohibits the use of child labor and forced labor. The Company has established a comprehensive

human resource management system including the Internal Competition Management Measures Compensation Management Employees may typically exercise their right to appeal through channels such as offline feedback email

Measures Employee Transfer Management Measures and Employee Reward and Punishment Management Regulations to systems and cloud mailboxes in accordance with regulations. Offline feedback is generally directed directly

effectively protect the legitimate rights and interests of employees and firmly prevent all types of illegal and non-compliant Adminis- to the Human Resources Department which investigates handles and responds. If there are objections to

employment practices. trative the offline handling results further appeals may be submitted via the Company email system or cloud

channels mailbox. The cloud mailbox is managed and supervised by the President's Office with handling results and

The Company has established a diversified and standardized recruitment process to attract outstanding talent from various feedback reported to company management to ensure timely and effective resolution of employee appeals.backgrounds. It fully considers the diverse backgrounds of candidates using abilities experience and skills as core evaluation

criteria during selection eliminating all forms of discrimination based on gender age marital status etc. to ensure fairness and

impartiality in recruitment. The Company strictly prohibits inappropriate behaviors such as verbal abuse and harassment and

imposes corresponding penalties based on the severity of violations aiming to create a positive working atmosphere for employ-

ees. Trade Employees may file complaints with the trade union. If the trade union verifies that the Company has

union infringed upon employees' labor rights and interests it has the right to legally demand corrections and

The Company continuously optimizes its recruitment management system establishing a channel strategy of "internal recruitment channels assume corresponding responsibilities.as the mainstay and external recruitment as supplementary." Talent quality assessment standards have been set screening

resumes based on factors such as age education corporate system experience and career stability. Interviews are evaluated

across four dimensions: company benchmarking competency benchmarking motivation benchmarking and cultural benchmark-

ing ensuring strict control over talent quality. Campus recruitment quality is rigorously controlled by assessing education institu-

In accordance with government requirements the Company has established a dedicated department for

tion major and political affiliation. Background checks conducted through third-party agencies mitigate hiring risks at the source

employee rights protection. Employee appeals can be accepted and filed through this department which

comprehensively improving recruitment quality. In 2025 the Company recruited 794 external talents including 115 management Other

urges relevant responsible departments to issue responses in accordance with regulations and facilitates

trainees achieving a notable improvement in talent quality. Among them 68.7% were from top-tier universities (985/211) repre- channels

review by superior competent authorities ensuring that reasonable employee demands are properly

senting a year-on-year increase of 32.1%; 61.7% held master's or doctoral degrees a year-on-year increase of 16.2%; and 29.6%

resolved.were Party members a year-on-year increase of 13.2%. The overall talent structure continued to be optimized.Employee compensation and performance grievance channels

Compensation and Performance Management

In democratic management the Company widely solicits employee opinions through channels such as the Employee Representa-

tive Congress and employee representative proposals. It carries out democratic management practices that are rich in content

distinctive in character and diverse in form effectively safeguarding employees' rights to know participate and supervise.In terms of leave and compensation management the Company strictly complies with laws and regulations such as the Regula-

tions on Paid Annual Leave for Employees and the Measures for the Implementation of Paid Annual Leave for Enterprise Employ-

ees ensuring that employee working hours meet legal requirements and safeguarding their right to rest and take leave. The

Company has formulated a unified compensation management system to standardize salary distribution and incentive manage-

ment for headquarters and subsidiaries. It has optimized the compensation structure by implementing a "broadband compensa-

tion" model reinforcing the incentive orientation of "paying for position value and paying for ability and performance." The Compa-

ny scientifically conducts job value assessments optimizes the job value map and clarifies career development paths for employ-

ees in both management and professional sequences. Within the salary bands employee compensation is adjusted based on

comprehensive performance evaluation results fully reflecting differences in employee capabilities and performance contribu-

tions thereby building a fair and reasonable compensation system.Employee Care Activities

87 88About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability

Management

Stable Growth Creation Management Shared Future

Each year the Company conducts an administrative service

Care and Benefits satisfaction survey for all employees. The questionnaire is

designed around seven key dimensions: property manage-

ment catering sanitation meetings shuttle buses official

In terms of employee care the Company has developed diverse heart- vehicles and security. The effective response rate reached

warming initiatives to meet the differentiated needs of different groups. 98% and the average employee satisfaction with these

For female employees a series of activities was organized for Interna- service areas reached 93% reflecting the Company's contin-

tional Women's Day including a corporate culture knowledge quiz a uous optimization of administrative service quality.female employee photo contest a visit to the Hayaoliu Print Museum

distribution of product discount coupons and a "Rose and Book The Company actively carries out a promotion month for

Fragrance" reading event. "Lilac" demonstration classes for female factory affairs transparency and democratic management

employees covering embroidery tie-dye and gourd pyrography were publicizing related knowledge through forms such as knowl-

opened to enrich their spiritual and cultural lives. Additionally edge competitions and employee representative training

mother-and-baby rooms were constructed to provide comfortable resting thereby strengthening the foundation for democratic Staff Team Building Activities

and nursing spaces for breastfeeding female employees. For employees management.facing difficulties regular support activities such as holiday visits Outstanding Female Workers Award in

HPGF Safety Training

assistance for major illnesses and care for children are carried out to

convey corporate warmth and enhance employees' sense of belonging.The Company has established a comprehensive employee benefit system Key performance

covering statutory benefits and company benefits. Statutory benefits are

strictly implemented in compliance with laws and regulations including

social insurance housing provident fund and other statutory welfare Indicator name Unit 2025 data

policies forming a solid baseline for protecting employee rights. Compa-

ny benefits encompass three categories: basic protection special Total number of employees Persons 10039

supplements and special care. In 2025 the Company further deepened

By gender

benefit practices by reaching group purchasing agreements with external

partners adding high-quality and cost-effective services such as refuel- Number of female employees Persons 4922

ing and insurance enriching benefit offerings and effectively enhancing

HPS Women's Day Activities

employees' sense of gain. Number of male employees Persons 5117

By age

Benefit type Content covered Number of employees aged 30 and below Persons 995

Number of employees aged 31 to 40 Persons 3427

Social insurance and housing provident fund: In compliance with laws and regulations pension Number of employees aged 41 to 50 Persons 3926

insurance medical insurance (including maternity insurance) unemployment insurance work-related

injury or ill health insurance and housing provident fund are paid for employees and relevant Number of employees aged 51 and above Persons 1691

Statutory benefits regulations of the state and local governments where the Company and its subsidiaries are located

regarding social insurance and housing provident fund are strictly implemented. Number of newly hired employees Persons 794

Benefit policies: National and local employee benefit policies are fully implemented and relevant Number of newly hired female employees Persons 428

requirements such as employee leave and benefits for single-child families are strictly enforced.Number of ethnic minority employees Persons 393

Number of employees with disabilities Persons 160

Basic benefits: These include in-kind holiday benefits annual physical examinations commuting

support free lunches and employee team-building activities. Employee turnover rate % 6

Special benefits: Based on the Company's actual situation and job characteristics supplementary Employee benefit coverage rate % 100

Company benefits insurance rental subsidies for off-site work tea break snacks fitness and entertainment facilities

and low-price group purchases are provided. Employee satisfaction survey coverage rate % 100

Special care benefits: Exclusive benefits such as mother-and-baby rooms are established to meet Employee trade union coverage rate % 100

the needs of specific employee groups.

89 90About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in

Product System for Value

Management Special Topic to Solidify a Foundation for Advance Low-Carbon Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation

to Build a Safe and

Management Shared Future

Talent Cultivation and Development Talent Development System

To achieve "standardization process-orientation institutionalization informatization digital intelligence and assessment-based The Company has constructed a talent development system centered around the three dimensions of "schools instructors and

management" the Company is comprehensively promoting the optimization and upgrading of its human resources system. This courses." It has refined the course matrix for all job categories and levels focusing on core areas that directly impact business

includes implementing "full life-cycle" career management for employees and building a human resources management system that operations such as marketing market development e-commerce and R&D. Key emphasis is placed on cultivating critical groups

aligns with market principles and matches the corporate culture. The Company focuses on building an incentive-oriented compensa- including management trainees reserve cadres and high-potential employees. The Company fosters an organizational

tion and performance system and a capability-oriented talent development system. It strengthens the development of its cadre team atmosphere combining "learning practicing testing and competing" forging practical skills through project immersion and job

and talent echelon adhering to the principle of "promoting the capable and demoting the mediocre." The Company increases invest- rotation ensuring that talent growth resonates with business development.ment in talent cultivation empowering management trainees and young cadres to grow through practical experience thereby stimu-

lating organizational vitality and providing talent assurance for the implementation of the Company's strategy and high-quality devel- The Company possesses a comprehensive position management and talent development system providing clear and well-defined

opment. career advancement channels for all job sequences including R&D production marketing communication and functional roles.In terms of talent development the Company has assembled a professional faculty composed of department leaders and business

backbones built a customized curriculum system and adopted diverse learning formats such as sharing sessions attendance at

System and Framework Setup important meetings work reports and study tours. For management personnel echelon development is strengthened through job rotation work reviews and case studies. For grassroots personnel the "master-apprentice" mentorship mechanism is continuous-

ly promoted. Concurrently a dynamic talent reserve pool has been established to provide solid support for both talent growth and

corporate development. In 2025 the Company was recognized as a Harbin Municipal High-Skilled Talent Training Base and

received the "AI Application Pioneer Award" from Beijing Beisen Cloud Computing Co. Ltd.The Company has formulated the Position System Management Measures to standardize position information and job responsibili-

ties laying a foundation for talent development. It has also formulated the Talent Development Management Measures which

based on knowledge skills and experience requirements for positions constructs diverse development paths that vertically cover

management professional and operational tracks and horizontally support cross-track transfers. The R&D System Professional

Track Qualification Rating Scheme (Trial) has been formulated to detail professional promotion standards for R&D personnel Case Digitalization empowering internal learning and capability enhancement

opening up a seven-level professional development channel from assistant researcher to chief scientist providing clear guidance

for R&D talent growth. At the same time the Company has formulated and implemented the R&D Project Incentive Scheme (Trial)

centered on full life-cycle management of R&D projects scientifically setting key milestone nodes and assessment indicators to In April 2025 the Company introduced an intelligent learning

continuously stimulate the innovative vitality of the R&D team. platform software to host internal and external learning

resources and shorten course production cycles using

AI-assisted course creation. Leveraging AI course creation

The Company has established and improved a talent development system clarifying career development paths and promotion

features the Company developed a total of 206 AI courses

rules through multiple policies. It also implements job value assessments comprehensively evaluating job value based on seven

during the reporting period saving approximately 500 hours

factors: span of control scope of responsibilities organizational impact environmental conditions problem-solving capabilities

in course recording and post-production time effectively

qualifications and communication requirements. In 2025 the Company further optimized its job mapping scientifically differenti-

enhancing the efficiency of training resource development.ated relative differences in job values and refined the position management system. The Company formulated the Performance

Based on business scenarios Renmintongtai applied AI-pow-

Management Measures to implement closed-loop performance management adhering to the principle of "comprehensive horizon-

ered practice partner features to conduct sales staff training

tal coverage and thorough vertical implementation." This ensures that all employees sign performance contracts and strengthens

focusing on strengthening pre-sales recommendations and

the application of performance results. Assessment outcomes are linked to performance bonuses merit-based salary adjust-

drug follow-up capabilities. This not only improved training AI Application Pioneer Award

ments cadre reappointment competitive promotion reserve talent selection and targeted training thereby motivating employees

efficiency but also facilitated the conversion of training

to achieve high performance. The Company implements the Cadre Appointment Management Measures following the principle of

outcomes into actual business performance.integrity and ability and selects cadres through a combination of open competition and organizational appointment. Additionally

the Company enforces a "one-year appointment" system for management personnel. Through comprehensive evaluation of perfor-

mance assessments competency appraisals work reports and daily rewards and punishments the Company determines eligibili-

Adhering to the talent attraction philosophy of "gathering

ty for cadre reappointment continuously building a high-quality and professional management team.people with brand retaining them with ecosystem motivat-

ing them with value warming them with policy and nurtur-

ing their growth" the Company expanded its employer

brand influence through 12 campus presentations 23

dual-selection fairs and university-enterprise collabora-

tions. It established a "Talent Subsidy" to enhance talent

attraction and implemented the "Harbin Talents New Policy

30 Articles." By leveraging competitive salaries and local Shenyang Pharmaceutical Dongbei University of Finance

policies the Company empowers the localized development University Job Fair and Economics Job Fair

of talent achieving win-win growth for talent enterprise

and city.

91 92About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation

to Build a Safe and

Management Shared FutureCase “Voyager Training Camp" program for reserve cadres Case University-enterprise collaboration: Advancing the joint cultivation mechanism for TCM talentTo support the Company's strategy and talent needs and strengthen the reserve cadre echelon the Company The Company continuously improves its diversified talent development system to meet the needs of the traditional

launched the first "Voyager Training Camp" for reserve cadres from March to October 2025 in accordance with Chinese medicine (TCM) industry. During the reporting period Shiyitang Chinese Medicine signed a joint cultiva-

the Reserve Cadre Selection and Development Plan. The program was held from March to October 2025 at tion agreement with the School of Pharmacy Heilongjiang University of Chinese Medicine and co-established a

Heilongjiang University and the Headquarters Multi-function Hall. Training content covered diverse courses joint cultivation base promoting the implementation of a university-enterprise collaborative education mechanism.including leadership enhancement management innovation marketing and finance. Teaching methods included By co-building practical training platforms involving corporate mentors in teaching and organizing students to

classroom interaction case studies and project presentations to systematically improve the comprehensive participate in actual R&D and production projects the two parties improved the alignment between talent cultiva-

abilities of reserve cadres. A total of 76 trainees participated in this session; currently 13 have been successfully tion and industry needs enhancing students' practical skills and professional identity. Simultaneously leveraging

promoted representing a promotion rate of 17% securing a pool of high-quality management talent for the the resource advantages of both the university and the enterprise in research and industry they engaged in

Company's development. exchange and cooperation in areas such as TCM R&D and the development of "Cold-Region Longjiang Medicines"

resources. This explores a talent development path connecting teaching practice and scientific research provid-

ing stable talent support for the Company's sustainable development and the high-quality development of the TCM

industry.Leadership enhancement and management Financial management training course

innovation training course

Case "Chunlei Training Camp" for the 2025 Cohort of Management Trainees

Joint cultivation by Shiyitang Chinese Medicine and

Heilongjiang University of Chinese Medicine

In July 2025 the Company launched the "Chunlei Training Camp" for the 2025 cohort of management trainees.Themed "Hapharm Group's New Stars: Chasing Dreams Forward Daring to Compete and Win" the program provid-

ed 115 management trainees with a 10-day immersive intensive training. The training featured systematic courses

including team-building exercises corporate culture strategic branding marketing planning and professional Key performance

ethics. Through diverse teaching formats such as centralized instruction site visits and study tours senior execu-

tive symposiums and project discussions and presentations the program comprehensively empowered the

growth of management trainees. It efficiently bridged the "last mile" from campus to the workplace helping new Indicator name Unit 2025 data

employees quickly integrate into the enterprise and become competent in their roles.Total training hours Hours 248712.2

Average training hours per person Hours 24.77

Total number of training sessions for the year Times 1968

Total investment in employee training Ten thousand yuan 295.71

Number of employee training participants Persons 9869

Employee training coverage rate % 98

Systematic curriculum training session Team-building exercises Percentage of employees receiving regular

performance and career development reviews % 100

93 94About This Message About 2025 Key Hapharm Performance in Sustainability

Governance and Compliance Green Operations to Employee Development

Report from the Management Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation Management Shared Future

In recent years the honors and awards received by Hapharm Group and its subsidiaries are as follows:

Occupational Health and Safety

The Company has constructed a comprehensive safety management system. A Work Safety Committee is established as the

highest authority for safety management responsible for decision-making on major work safety matters providing business

support and formulating overall safety management policies. A dedicated safety management department the EHS and Engineer-

ing Equipment Department is responsible for setting safety assessment goals and indicators establishing and operating the Hayao General Factory Sanchine

safety management system conducting performance assessments and investigating and handling major safety accidents. All

subordinate industrial R&D and commercial units have established safety management departments responsible for decompos- In 2024 it was awarded the In 2023 it was awarded the

ing and implementing safety management goals and indicators building and ensuring compliant operation of systems pursuing title of Advanced Organization title of Winning Unit in the

continuous improvement providing business training fostering a safety culture and investigating and handling safety accidents Unit in the Harbin Ankang Cup 2021-2022 Heilongjiang

within their respective units. Competition and the Province Ankang Cup

recycling group of Workshop in 2024 it was awarded the

301 was awarded the title of title of Winning Unit in the

Excellent Team in the Ankang 2022-2023 Harbin "Ankang

Cup. Cup" Competition.President

EHS and Engineering Equipment Department

Shiyitang Chinese Medicine Sanjing Mingshui

In 2024 it won the "First Prize in In 2024 it was awarded the title

the Team Competition of Mini of "2024 Suihua City Occupa-

Fire Stations for Key Fire Safety tional Health Enterprise."

Units in Daoli District."

Organizational structure chart of the safety management

system of Hapharm Group

The Company has formulated systems such as the Safety Management

System Plan Occupational Health Management Measures and Procedures

for Reporting Investigating and Handling of Work Safety Accidents and

Emergency Rescue Plans for Safety Accidents and Sudden Incidents to

strengthen work safety and occupational health management prevent and

reduce production safety accidents and prevent occupational disease

hazards promoting its own sustainable and healthy development. As of the

end of the reporting period the Company's subsidiary Sanjing Mingshui

obtained certification under the ISO 45001 Occupational Health and Safety

Management System.Sanjing Mingshui Occupational Health and Safety

Management System Certification Certificate

9596

Shenglin Asset

Art and Culture

GNC China

Health Technology

Renmintongtai

Marketing Company

Sanjing Daqing

Sanjing Children

Sanjing Qianhe

Sanjing Mingshui

Hapharm Group

Shiyitang Chinese

Medicine

Hayao No.6 Factory

Hayao Sanjing

Hayao General Factory

Technology Center

Beijing Biotechnology

Co. Ltd.Company

headquartersAbout This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation Management Shared Future

The Company adheres to the safety management principle of "prevention first continuous improvement zero accidents and zero

pollution" promoting a comprehensive safety awareness enhancement plan and building a safety management system with

"leadership taking the lead and all employees participating." This plan integrates case analysis experience sharing ideological

education and humanistic care supported by a reward and penalty mechanism for violations. In 2025 the Company and its

subsidiaries implemented incentive measures such as the Ankang Cup competition striving to create a safety culture of "full

participation and shared responsibility" through diverse cultural promotion.Medal for Advanced Organiza- Medal for Winning Team in the

tion Unit in the Harbin Ankang Harbin Ankang Cup Competition

Cup Competition awarded to awarded to Workshop 301 of

Hayao General Factory Hayao General Factory Case Multi-pronged measures to enhance "dual-hazard" management and empower intrinsic safety

In July 2025 to thoroughly implement the Three-Year Action Plan for Tackling the Root Causes of Production

Safety (2024–2026) issued by the Office of the State Council Work Safety Committee Hayao General Factory

focused on the management of highly toxic easily explosive and other hazardous chemicals and dangerous

operations comprehensively upgrading its "dual-hazard" control level. The Company organized over 40 safety

management personnel and key operational staff to conduct a special seminar on the new version of the Safety

Specifications of Special Work in Hazardous Chemicals Enterprises (GB 30871–2022). Through analysis of typical

cases and benchmarking against regulations the seminar refined approval processes strengthened on-site

supervision and held in-depth discussions on issues such as "insufficient supervisor capabilities" and "difficulties

in dynamic risk control" further solidifying the foundation for on-site management of special operations.This special enhancement initiative aims to shift safety

management towards root cause governance and empower

Medal for Winning Unit in the Medal for Winning Unit in the enterprise intrinsic safety. By transforming institutional

Heilongjiang Province Ankang Harbin Ankang Cup Competi- norms into rigid constraints it has effectively improved the

Cup Competition awarded to tion awarded to Sanchine scientific level of "dual-hazard" control. This is not only an

Sanchine active response to the national campaign for tackling root

causes of work safety but also lays a solid safety foundation

for the Company's high-quality development.Safety-related laws and regulations training

Medal for First Prize in the Team Competi- Certificate for 2024 Suihua City

tion of Mini Fire Stations for Key Fire Occupational Health Enterprise

Safety Units in Daoli District awarded to awarded to Sanjing Mingshui

Shiyitang Chinese Medicine

97 98About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Special Topic to Solidify a Foundation for Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability

Management

Stable Growth Creation Management Shared Future

Case Sanchine building an intelligent safety management system The Company has established a regular risk identification mechanism conducting annual risk identification work and promptly

initiating identification and response actions in the event of significant changes. For identified risks the Company implements

As a comprehensive pharmaceutical enterprise Sanchine is characterized by numerous buildings on its premises classified control: safety risks are categorized into four levels—major significant general and low; environmental and occupation-

and a wide scope of control. Addressing pain points such as cumbersome approvals and blind spots in patrols al health risks are divided into two levels—major and general. Since 2022 the Company and its subsidiaries have progressively

under traditional safety management Sanchine has innovatively built an intelligent safety management system. It carried out risk classification and control work completing the comprehensive identification and assessment of major risks. Corre-

developed a big data approval platform that integrates multiple databases to achieve automatic qualification sponding control measures and emergency plans have been formulated for different risk levels building a dynamically managed

verification and generate assessment reports within three minutes. It upgraded video surveillance to provide risk prevention and control network.

24-hour uninterrupted monitoring and introduced drones for high-altitude inspections. Through the synergy of

"platform + hardware" the efficiency of safety operation approvals increased by 60% hazard investigation cover- In terms of occupational health and safety management the Company set a management goal of zero work safety accidents and

age reached 100% and emergency response speed improved by 50%. This drove the transformation of safety a continuous decline in safety incidents. During the reporting period the Company strictly adhered to the red lines of safety and

management from "passive response" to "proactive prevention" solidifying the safety line of defense in the occupational health management achieving zero work safety accidents fire incidents and traffic accidents. All required occupa-

pharmaceutical sector. tional health examinations were conducted all workplaces with occupational hazard factors were fully monitored and no new

cases of occupational disease were reported providing a solid safety guarantee for production and operations.Key performance

Indicator name Unit 2025 data

Total duration of occupational health and work

safety training for employees Hours 85336

Total duration of occupational health and work

safety training for suppliers and contractors Hours 8226.5

Number of safety drills (fire toxic gas leaks etc.) Number of times 121

Investment in occupational health and safety

management Ten thousand yuan 753.10

Real-time monitoring by the digital system

Investment amount for employee work-related

injury insurance Ten thousand yuan 573.46

Investment amount for employee work safety

liability insurance Ten thousand yuan 6.28

Number of work-related injuries (minor and above) Persons 0

Number of work-related fatalities Persons 0

Number of workdays lost due to work-related

injuries Days 0

Occupational disease incidence rate % 0

Aerial patrols by drones

99 100About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation Management Shared Future

Rural Revitalization Practices Case Party building as a pen to paint a new picture of revitalization for Sixin Village

To consolidate and expand the achievements of poverty alleviation and effectively link them with rural revitalization the Company The Company has provided targeted assistance to Sixin Village in Yilan County Harbin Heilongjiang Province for

actively responded to the national rural revitalization strategy deployment. Relying on the Heilongjiang Hapharm Foundation it nine consecutive years. Through multi-dimensional initiatives including industrial support infrastructure improve-

planned and implemented the "Hapharm Foundation Rural Guardian Program." Adhering to the principle of "adapting measures to ment healthcare assistance and Party-building collaboration the Company has helped the village achieve poverty

local conditions and implementing targeted policies" the project focuses on health security and implements targeted assistance alleviation and advance rural revitalization. Adopting a systematic and sustainable assistance model the Company

measures empowering rural revitalization through corporate responsibility and effectively safeguarding the health and well-being has aligned its efforts with local needs with Party-building as the guiding approach and industrial empowerment

of the people. During the reporting period the Company donated a total of RMB 60000 worth of common medicines to rural areas. as the key driver leading targeted support initiatives to ensure effective implementation.These supplies were distributed through grassroots health institutions to precisely meet the daily medication and common disease

treatment needs of the residents. The project benefited 16 villages and 4755 people in Heilongjiang Province. The Company’s Party committee has

strengthened rural assistance through

Party-building practices establishing

Case Party-building walls and corridors to Warming old revolutionary base areas and safeguarding health promote Party theories and historical

stories and supporting Sixin Village in being

From October to November 2025 the Company through the Hapharm Foundation visited seven old revolutionary recognized as a provincial-level demonstra-

base area villages in Hulan District Bin County and other areas to conduct health outreach activities contributing tion village for Party-building. The Company

to rural revitalization with practical actions. Based on preliminary surveys of villagers' health needs a total of 9000 has also supported the development of the

boxes of common medicines for colds gastrointestinal issues and inflammation were donated on-site. In collabo- village’s fungus greenhouse industry to

ration with township health centers and village doctors one-on-one medication guidance was provided to villagers increase income for the collective economy

and knowledge on safe medication use was disseminated. Through a model of "material donation + professional and households lifted out of poverty Party building corrido

services" the activity effectively addressed the issues of "difficulty in purchasing and using medicine" for villagers organized a resident work team to assist in

in old revolutionary base areas. It received widespread recognition from local village committees and villagers improving the village environment and used

injecting solid health momentum into rural revitalization. special funds to procure rice flour and

cooking oil to provide support to households

lifted out of poverty during the Spring

Festival. During the reporting period the

Company invested a total of RMB 310200 in

assistance benefiting 630 people. Prior to

the Spring Festival supplies such as rice

flour and cooking oil were distributed to

households lifted out of poverty while

resident team members also assisted in Village-based work team assisting with

cleaning the village environment contribut- sanitation cleanup

ing to rural development and improved

livelihoods.During the reporting period the Company

Invested RMB?????? in rural revitalization，Benefitted????peopleOn-site distribution of medicines

101 102About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in

Product System for Value

Management Special Topic to Solidify a Foundation for Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation Management Shared Future

The Company has always practiced the volunteer service spirit of "dedication friendship mutual assistance and progress." It

Public Welfare and Social Action innovatively created the distinctive volunteer service project "Hapharm Foundation Rescue is at Hand" focusing on two core areas:

voluntary blood donation and cardiopulmonary resuscitation (CPR) first aid skills training regularly carrying out volunteer service

activities. In 2025 the Company actively organized voluntary blood donation events with 723 volunteers from 15 units participating

to spread warmth. Concurrently two sessions of cardiopulmonary resuscitation (CPR+AED) first aid skills training were conducted

For many years the Company has adhered to the charitable purpose of "developing public welfare and charity and promoting with 90 volunteers enhancing their emergency response capabilities.social civilization and progress." It has deeply integrated public welfare into its corporate sustainability strategy and continuously

invested resources to support the high-quality development of public welfare undertakings. The Company established a profes-

sional and standardized public welfare management system and a full-process support mechanism to ensure that public welfare Case Volunteering to warm the Asian Winter Games: Hapharm Group in action

resources are precisely matched efficiently implemented and practically effective. Over the past three years the Company has

donated a total of RMB 39.394 million in funds and materials benefiting 460400 people. Focusing on key social needs the

Company concentrated on critical areas such as caring for the elderly and children disaster emergency relief and volunteer

During the preparation and hosting of the 9th Asian Winter Games in Harbin the Company actively responded to

services. It meticulously created branded public welfare projects including "Hope Guards Health Hapharm Group Grows with Me"

the call and organized 41 employee volunteers to participate in city-side volunteer services. Volunteers stationed

"Happiness 1+1" "Warming the Sunset Years Guarding the Silver-Haired" and "Hapharm Foundation Rescue is at Hand." This

at Harbin Railway Station provided considerate services such as civility guidance and inquiry resolution for passing

formed a regular diversified and sustainable pattern of public welfare practice demonstrating corporate social responsibility

tourists. Along the torch relay route they cheered for torchbearers with full enthusiasm conveying the warmth of

through practical actions.the Asian Winter Games and demonstrating the demeanor of the host through practical actions. This volunteer

service received wide social recognition. The Social Work Department of the Harbin Municipal Committee of the

During the reporting period the Company Communist Party of China awarded certificates for

city-side volunteer service at the Asian Winter

Games to the 41 volunteers fully affirming their

Invested RMB?????? in the social welfare Helped????people through the public welfare hard work and sense of responsibility. At the

initiatives summary and commendation conference of the

Organized ???employees in volunteer activities Had an average service duration of ?.??hours per Asian Winter Games the Harbin Pharmaceutical

person for employee volunteer activities Group Holding Co. Ltd. Asian Winter Games Volun-

teer Service Team was awarded the provincial-level

"Advanced Collective" title and Hapharm Group.was awarded the municipal-level "Advanced Collec-

Public welfare donations and volunteer services tive" title. These dual honors highlighted the enter-

prises' social responsibility and public welfare

The Company carries out external donations and assistance actions mainly through its Hapharm Foundation and continuously spirit and represented the enterprises' contribu- 9th Harbin Asian Winter Games Torchbearer – Employee

expands forms of public welfare participation by organizing employee volunteer services. tion to the successful hosting of the Asian Winter of Sanjing Pharmaceutical

Games.Case Hapharm Foundation creating a journey of growth through ice and snow study tours

In January 2025 the Company planned and imple-

mented the "Budding Growth: Winter Journey with Ice

and Snow" public welfare study tour activity inviting

children from Daliangshan in Sichuan Yinchuan in

Ningxia and Putian in Fujian to visit Harbin. The

children were immersed in the charm of ice and snow

experienced curling visited art exhibitions and more.This heartwarming initiative lit up childhood dreams

and safeguarded the healthy growth of children. In

May Company volunteers made a special return visit to

Ningxia to fulfill the promises of the "Dream Archives."

Through measures such as holding popular science

lectures on children's bone nutrition and donating

sports equipment they continued to convey care. This

activity not only broadened the horizons of rural Volunteer service activity at Harbin Railway Station

children but also vividly interpreted the public welfare

concept of "Health Guards Dreams" demonstrating

the Company's sense of social responsibility."Budding Growth: Winter Journey with Ice and Snow"

public welfare study tour activity site

103 104About This Message About 2025 Key Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in

Sustainability

Management Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth Creation

to Build a Safe and

Management Shared Future

Social services and public value

Case Professional nutrition empowering event services and promoting a healthy lifestyle for all persons

Leveraging its advantages in the pharmaceutical and healthcare industry the Company carried out diverse social service practic-

es focusing on public health services care for special groups and urban public services. While improving service accessibility In May 2025 GNC China participated in the 2025 West Lake Half Marathon in Hangzhou providing participants with

it actively created social value. systematic nutritional support before during and after the race. The Company provided joint health supplements

prior to the race organized support teams to offer on-site supplies during the race and worked with medical and

rehabilitation teams after the race to provide stretching and recovery guidance. An on-site experience area wasCase Travel dialysis: Worry-free love also set up to offer nutrition consultation and health services. Through an integrated “product + service + experi-ence” support model the Company promoted scientific sports nutrition concepts enhanced public awareness of

In December 2025 Heilongjiang Sanjing Nephropathy Hospital healthy dietary supplementation and strengthened its professional image in the sports health sector contributing

centered on patients’ needs integrated health science popular- to a culture of scientific fitness and active lifestyles.ization and service innovation and held a themed event at

Parkson Shopping Center on Central Street. The hospital

assembled a professional medical team of 10 members with

on-site consultation desks case exhibition areas and interac-

tive experience zones. It systematically explained the proce-

dures precautions of travel dialysis as well as off-site dialysis

appointment support services addressing questions and

concerns of kidney disease patients.The event innovatively

integrated traditional Chinese medicine expertise with the

distinctive travel dialysis service enabling patients to under-

stand the feasibility of receiving dialysis while traveling. It

effectively removed travel restrictions for kidney patients and GNC China event support

delivered the humanistic medical philosophy of people-oriented

care. Meanwhile leveraging the large foot traffic of the venue Event Site

the event further raised public awareness of specialized medical

The Company actively fulfilled its social responsibilities focusing on the integrated development of cultural communication and

services bringing high-quality.public welfare. It leveraged its professional resources to carry out diverse cultural activities promoting the combination of cultural

heritage protection and public education and continuously enhancing social and cultural awareness and participation.Case Special exhibition of repatriated cultural relics to promote cultural communication

Case Caring for new employment groups with heartwarming services to safeguard health

In 2025 the Company in collaboration with relevant units held the "National Treasures Gather in the Ice City—

To genuinely care for the physical and mental health of new employment groups such as couriers and ride-hailing Special Exhibition of Repatriated Cultural Relics" in Harbin with multi-party teams participating in the curation and

drivers Renmintongtai actively engaged in safeguarding their health. It took the initiative to integrate its pharma- implementation. Centered on repatriated cultural relics the exhibition presented their historical value and dissemi-

ceutical resources to build a comprehensive health protection system covering medication discounts health nated knowledge on their protection through systematic displays and on-site explanations. The event effectively

services and green medical channels putting into practice the concept of government-enterprise collaboration for enhanced public awareness and consciousness of cultural heritage protection increased social participation and

promoted the integration of cultural resources with the city's cultural tourism. This reflected the enterprise's

public benefit. Renmintongtai selected 500 common responsible values in cultural communication and public welfare practices.drugs to offer exclusive discounts effectively reduc-

ing the medication burden on new employment

groups. It established "Heartwarming Stations" in its

pharmacies providing a range of services including

emergency medicine health monitoring and conve-

nient rest areas. From a cup of plum juice in the

summer to a cup of warming tea in the winter these

small acts of kindness warmed every frontline worker

in new employment groups. Through practical

actions it conveyed warmth helping to enhance the

sense of gain and happiness for these groups and

making the city warmer. Launch ceremony of the event Special Exhibition site Bronze Animal Heads Exhibition

1Heilongjiang Sanjing Nephropathy Hospital is a non-profit Grade III specialized hospital affiliated with Rentongtai (600829.SH)

a subsidiary under the Company’s holding.

105 106About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in

Product System for Value

Group Sustainability Management

Special Topic to Solidify a Foundation for Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Stable Growth Creation Management Shared Future

Honors and awards of Hapharm Group

2022.92023.2

HARBIN PHARMACEUTICAL GROUP CO. LTD. was awarded HARBIN PHARMACEUTICAL GROUP CO. LTD.the First "Longjiang was awarded the

Charity Award—Donor Enterprise Award" of the Province "2020–2021 National Blood Donation Promotion Award"

Heilongjiang Civil Administration National Health Commission of the People's Republic of China Red

Information Net Cross Society of China Health Bureau of the Logistic Support

Department of China's Central Military Commission (CMC)

2024.82026.2

HARBIN PHARMACEUTICAL GROUP CO. LTD. Harbin Pharmaceutical Group Co. Ltd. was

was awarded the "Heilongjiang Province Youth Public awarded the Municipal Advanced Collective for

Welfare Activity Research and Practice Base" the 9th Harbin Asian Winter Games

Heilongjiang Provincial Committee of the by the CPC Harbin Municipal Committee and

Communist Youth League Heilongjiang Harbin Municipal People’s Government

Youth Development Foundation

107 108About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth

Creation Management Shared Future

Key Performance Table

Indicator Unit 2025 data Indicator Unit 2025 data

Governance Performance Environmental Performance

Operating revenue RMB 100 million ???.?? Number of participants in environmental management training Person-times ????

Total assets RMB 100 million ???.?? Number of participants in environmental protection publicity and public welfare activities Persons ???

Net assets attributable to shareholders of the listed company RMB 100 million ??.?? Number of emergency drills for environmental risk incidents conducted Sessions ??

Net profit attributable to shareholders of the listed company RMB 100 million ?.?? Number of participants in environmental emergency risk drills Persons ????

Basic earnings per share Yuan per share ?.?? Total greenhouse gas emissions Tonnes of CO2 equivalent ??????.??

Total tax payments RMB 100 million ?.?? Photovoltaic power generation MWh ????.??

Percentage of independent directors % ??.? Proportion of clean energy consumption to total energy consumption % ??.??

Percentage of female directors % ??.? Total clean energy consumption (photovoltaic natural gas) Tonnes of standard coal ?????.??

Number of Board of Directors meetings held Times ?? Direct energy consumption Tonnes of standard coal ?????.??

Director attendance rate % ??? Indirect energy consumption Tonnes of standard coal ?????.??

Number of director training sessions conducted Times ? Total energy consumption Tonnes of standard coal ?????.??

Number of Shareholders' Meetings held Times ? Energy consumption intensity per million RMB in revenue Tonnes/RMB 1 million in revenue ?.??

Total number of investor questions received Times ??? Total water consumption Tonnes ???????

Investor question response rate % ??.?? Freshwater consumption Tonnes ???????

Integrity risk assessment coverage for the Company and its subsidiaries % ??? Recycled water consumption Tonnes ????????

Employee signing rate for compliance commitment letters % ??? Water consumption intensity per million RMB in revenue Tonnes/RMB 1 million in revenue ???.??

Signing rate of Integrity Commitment Letters for bidding suppliers % ??? Total amount of wastewater discharge Tonnes ???????

Number of compliance risks identified during the year Items ??? Chemical oxygen demand (COD) Tonnes ??.??

Number of compliance risk response plans formulated Copies ?? Ammonia nitrogen (NH3-N) Tonnes ?.??

Number of compliance training sessions conducted Times ? Total waste gas Cubic meter ?????.??

Number of employees covered by compliance training Person-times ???? Particulate matter (PM) Tonnes ?.??

Number of anti-commercial bribery and anti-corruption training sessions conducted Times ?? Sulfur oxides (SOx) Tonnes ?.??

Employees participating in anti-commercial bribery and anti-corruption training Person-times ???? Nitrogen oxides (NOx) Tonnes ??.??

Number of internal audit projects conducted Items ?? Volatile organic compounds (VOCs) Tonnes ???.??

Total hazardous waste Tonnes ???.??

Total non-hazardous waste Tonnes ????.??

Indicator Unit 2025 data

Waste recycling rate % ??.??

Environmental Performance

Hazardous waste intensity Tonnes/RMB 1 million in revenue ?.??

Total investment in environmental protection Ten thousand yuan ????.??

Non-hazardous waste intensity Tonnes/RMB 1 million in revenue ?.??

Total duration of environmental management training Hours ????

109 110About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Product System for Value Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth

Creation Management Shared Future

Indicator Unit 2025 data Indicator Unit 2025 data

Social Performance Social Performance

Total R&D investment Ten thousand yuan ?????.?? Number of newly hired employees Persons ???

Proportion of R&D investment to operating revenue % ?.?? Number of ethnic minority employees Persons ???

Proportion of R&D investment to operating revenue of the industrial segment % ?.?? Number of employees with disabilities Persons ???

Proportion of R&D personnel % ??.?? Employee turnover rate % ?

Total number of valid patents held Items ??? Employee benefit coverage rate % ???

Total number of invention patents applied for in the year Items ?? Employee trade union coverage rate % ???

Total number of invention patents granted in the year Items ? Total duration of employee training Hours ??????.?

Total number of valid trademarks held Items ??? Average training hours per person Hours ??.??

Total amount of scientific and technological innovation awards granted Ten thousand yuan ???.?? Total number of training sessions for the year Times ????

Number of projects recognized with scientific and technological innovation awards Pcs ??? Total investment in employee training Ten thousand yuan ???.??

Number of major quality accidents throughout the year Times ? Number of employee training participants Persons ????

Number of non-conformance announcements Items ? Employee training coverage rate % ??

Product qualification rate % ??? Percentage of employees receiving regular performance and career development reviews % ???

Customer feedback handling rate % ??? Total duration of occupational health and work safety training for employees Hours ?????

Number of responsible marketing audits conducted Times ?? Total duration of occupational health and work safety training for suppliers and contractors Hours ????.?

Total number of suppliers Counts ???? Number of safety drills Number of times ???

Proportion of local suppliers % ??.?? Investment in occupational health and safety management Ten thousand yuan ???.??

Local procurement ratio % ??.?? Investment amount for employee work-related injury insurance Ten thousand yuan ???.??

Number of suppliers with document audits conducted Counts ???? Investment amount for employee work safety liability insurance Ten thousand yuan ?.??

Number of suppliers with on-site audits conducted Counts ??? Number of work-related injuries (minor and above) Persons ?

Suppliers that underwent and passed environmental and social audits Counts ?? Number of work-related fatalities Persons ?

Number of supplier training sessions conducted Times ??? Occupational disease incidence rate % ?

Total number of employees Persons ????? Total investment in rural revitalization Ten thousand yuan ??.??

Number of female employees Persons ???? Number of people benefiting from rural revitalization Persons ????

Number of male employees Persons ???? Investment in social welfare Ten thousand yuan ??

Number of employees aged 30 and below Persons ??? Number of people assisted through public welfare initiatives Persons ????

Number of employees aged 31 to 40 Persons ???? Number of employee participations in volunteer activities Person-times ???

Number of employees aged 41 to 50 Persons ???? Average service hours per person for employee volunteer activities Hours ?.??

Number of employees aged 51 and above Persons ???? Number of participants covered by sustainable development training Person-times ??

111 112About This Message About 2025 Key Hapharm Performance in Sustainability

Governance and Compliance Green Operations to Employee Development

Report from the Management Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon to Build a Safe and Appendix 2025 Sustainability Report

Chairman Group Sustainability Stable Growth

Creation Management Shared Future

Index of Indicators Reader Feedback Form

Guidelines No. 14 of Shanghai Stock Dear ReadersGuidelines for Sustain-

Contents Exchange for Self-Regulation of ability Reports of Listed Companies – Sustainability Chinese Enterprises

Report (Trial) Thank you for reading the 2025 Sustainability Report of HARBIN PHARMACEUTICAL GROUP CO. LTD. We highly value your (CASS-ESG 6.0)

valuable opinions and suggestions and sincerely invite you to evaluate this report. Every piece of your feedback will help us contin-

About This Report - P? uously optimize the quality of our ESG information disclosure improve our sustainability management system better fulfill our

social responsibilities as a pharmaceutical enterprise and safeguard public health and well-being.Message from the Chairman - P?

About Hapharm Group - P?

Sustainability management Communications with stakeholders and due diligence G?.?，G?.?，G?.?I. What is your identity:

Special topic: Empowering with a digital and intelligent

engine building a foundation for high-quality Innovation-driven S?.?

development through technological innovation

Party building leadership and □ Shareholder and investor □ Creditor □ Company employee □ Partner and industry association

responsibility implementation

Governance and

compliance to Construction of corporate

□ Customer □ Supplier and contractor □ Media and public □ Government and regulatory agency

solidify a governance system

G?.?

□ Other __________

foundation for Internal control and compliance

stable growth management

G?.?

Culture of integrity and ethical Anti-commercial bribery anti-corruption and

business practices anti-unfair competition G?.?，G?.? II. Your overall evaluation of this report:Technological r&d and

innovation-driven development Innovation-driven development S?.?

Ethics of science and technolo- Ethics of science and technology What is your evaluation of the overall content of this report:gy

Industrial cooperation and □ Excellent □ Good □ Average □ Poor □ Very poor

Product system exchange

for value creation Product quality and safety Equal treatment to small and medium-sized enterpris-

management es; Safety and quality of products and services S?.?，S?.?Do you think this report comprehensively and objectively reflects the company's actual performance in the environmental social

Customer rights and interests Data security and customer privacy protection

and service assurance S?.? and governance (ESG) fields in 2025

Supply chain management and

security Supply chain security S?.? □ Very adequate □ Relatively adequate □ Average □ Relatively inadequate □ Inadequate

Information security and privacy

protection Data security and customer privacy protection S?.?

Medicine accessibility enhance- Do you think the information disclosed in this report is clear accurate and complete:

ment

Environmental compliance Environmental compliance management E?.? □ Very high □ High □ Average □ Low □ Very lowmanagement

Climate change tackling Climate change tackling E?.?

Green operations What do you think of the structural design and readability of this report:Energy and resource manage-

to advance ment Energy utilization water resource utilization E?.?，E?.?low-carbon □ Excellent □ Good □ Average □ Poor □ Very poor

management Pollutant emissions Pollutant discharge E?.?

Waste management Waste management circular economy E?.?，E?.? III. Your opinions and suggestions:Ecosystem and biodiversity Ecosystem and biodiversity protection E?.?

conservation

Employee rights and well-being S?.?

Talent cultivation and develop- Employees

Employee S?.?ment

development to

build a safe and Occupational health and safety S?.?

shared future

Rural revitalization practices Rural revitalization S?.?

Public Welfare and Social Action Contributions to the society S?.?

113 114About This Message About 2025 Key Sustainability Governance and Compliance Green Operations to Employee Development

Report from the Hapharm Performance in Management Special Topic to Solidify a Foundation for

Product System for Value Advance Low-Carbon Appendix 2025 Sustainability Report

Group Sustainability Stable Growth Creation

to Build a Safe and

Chairman Management Shared Future

Independent Assurance and Statement of Opinion 4. Selected the relevant part of environmental social and governance information in this Report performed analytical assurance procedures for such information confirmed the overall performance situation and evaluated and verified whether the contents

of the Report are complied with.

5. Verified the process management of the principles of inclusiveness substantiality responsiveness and impact in the Report

InFaith Consulting (hereinafter referred to as "InFaith") as entrusted by Harbin Pharmaceutical Group Co. Ltd. (hereinafter and its related AA1000 to confirm the appropriateness of this Statement.referred to as "Hapharm Group") has conducted independent limited assurance of the environmental social and governance 6. Sampled inspection on supporting evidence of data reliability and quality of selected specific performance information.information and data disclosed in 2025 Sustainability Report of Hapharm Group (hereinafter referred to as "the Report") and 7. Recalculated and verified the selected specific performance information.disclosed the assurance result and conclusion to readers of the Report in the form of independent assurance and statement of 8. Performed other procedures that we deemed necessary.opinion.Independence and Capability Assurance Conclusions

1. All the assurance team members of InFaith have no business relationship with Hapharm Group that leads to conflicts of interest. 1. According to the information provided by Hapharm Group and the sample test there is no material misrepresentation in the

The team of InFaith has performed this assurance work independently. Report.

2. The assurance team of InFaith consists of experienced professionals in the industry. Relevant persons have received profes- 2. For the principles of inclusiveness substantiality responsiveness and impact included in AA1000AS v3 the detailed assurance

sional training on the GRI Standards issued by the Global Reporting Initiative AA1000AS v3 ISO 14001 ISO 26000 SA 8000 conclusions are as follows

EcoVadis global supply chain rating and other sustainability-related standards and have adequate understanding and practical

experience in relevant international principles evaluation systems and assurance standards. Hapharm Group has announced major topics that will have substantial influence and impact on the evalua-

Inclusivity tion decision-making actions and performance of the organization and its stakeholders and judged and

Assurance Statement improved the management and performance of the issues.

1. Hapharm Group management shall be fully held accountable for the preparation and content of the Report. It is the responsibili- Hapharm Group has announced significant topics that have a substantial impact and influence on the

ty of InFaith to conduct an assurance based on the scope as described herein and to provide professional assurance opinions to Materiality organization and its stakeholders' assessments decision-making actions and performance. The company

the Report readers and stakeholders. has also conducted judgments and improvements on the management and performance of these topics.

2. Based on the assurance scope limits InFaith shall in accordance with AA1000AS v3 conduct independent limited assurance

and guarantee conclusion for the matters within the scope defined in the Report. In addition to providing independent assurance Hapharm Group has implemented relevant policies and is able to respond to issues that concern the stake-Responsiveness

and making other statements of opinion on the facts of assurance under the conclusion InFaith will not assume any legal or other holders in a timely manner.liabilities for any inquiries for any other purposes or for any other persons who read this Independent Assurance and Statement Hapharm Group has the adequate ability to identify substantive issues. It has implemented balanced and

of Opinion. effective evaluation and disclosure methods and has established a systematic process for monitoring

3. If you have any questions about the contents contained herein or related matters Hapharm Group will reply in a lump sum. Impact measurement evaluation and management impact so as to achieve more efficient management of

4.In the event of any conflict or inconsistency between the Chinese version and the English version of this Independent Assur- decision-making and results within the organization and demonstrate the impact of the substantive issues

ance and Statement of Opinion the Chinese version shall prevail. in an impartial and objective manner.Assurance Standard 3. Based on the procedures implemented and the evidence obtained by InFaith we have found nothing that causes us to doubt

InFaith adopts AA1000AS v3 type-1 Moderate assurance level which includes Hapharm Group's evaluation of the compliance situation the reliability and quality of the specific performance indicators selected in the Report.and degree of the four AA1000AS v3 assurance principles including inclusiveness substantiality responsiveness and impact.Limitation

Assurance Scope The assurance process was carried out at the location within the scope of the Report.Because there is no internationally recognized and commonly used standard for the evaluation and measurement of non-financial

1. The assurance scope is limited to the information and data of Hapharm Group and its affiliated companies covered by the

information the application of different but acceptable information and measurement technologies may affect the comparability

Report excluding the data and information of Hapharm Group suppliers contractors and other third parties.with other institutions.

2. InFaith adopts AA1000AS v3 type-1 Moderate assurance level to evaluate Hapharm Group's compliance nature and degree of

the four assurance principles in AA1000AS v3.If you have any advice for this Independent Assurance and Statement of Opinion you

Assurance Process and Work may contact:

Tel: 021-20740303

In order to gather evidence relevant to the formation of the conclusion InFaith has done the following work: Email: esg@infaith.com.cn

1. Had interviews with the management team and employees of Hapharm Group to understand the overall situation and relevant Address: 17F Tower 1 Lujiazui Riverside Center 257 Lane Binjiang Avenue Pudong

processes of the fulfillment of its environmental social and governance responsibilities. New District Shanghai

2. Verified key developments and policy implementation of the relevant Hapharm Group's organizations and reviewed supporting

evidence for the claims made in the Report. For and on behalf of InFaith Consulting

3. Through the interviews and the assurance of relevant documents learned about Hapharm Group's main stakeholders and their Signed:

expectations and demands the specific communication channels between both parties and how Hapharm Group responds to

their expectations and demands.Shanghai April 2026

115 116HARBIN PHARMACEUTICAL GROUP CO. LTD.

Address: No.7 Qunli Avenue Daoli District Harbin City Heilongjiang Province

Tel:0451-5187 0077

https://www.hayao.com/