2023
Social ResponsibilityReport
For the health For the future
Safeguarding ProductQuality
Quality Management SystemQuality Risk ControlQuality Training for EmployeesIntellectual Property Rights Protection Protection of Customer Rights and InterestsSupply Chain Management
The Reportat a Glance
About Joincare
Responsible GovernanceChairman’sStatement
Group OverviewOrganisational StructureCorporate CultureKey PerformanceHonours
CSR Strategy
CSR Governance
Communication on CSR
Compliance Governance
Risk Management
Carrying Forward the Party-Masses Spirit
Integrity and Business Ethics
Information Security
Contents
Quality Management SystemQuality Risk ControlQuality Training for EmployeesIntellectual Property Rights Protection Protection of Customer Rights and InterestsSupply Chain Management
Access to Healthcare
Focusing on R&D and Innovation Paying Attention to Rare Diseases Treatment Improving Product AvailabilityImprovingProductA?ordabilityImproving Healthcare
Operating with Green Sustainability
Talent Management
Data List of KeyPerformanceIndicatorsPublic Welfare and Charity
Environmental Management System Addressing Climate ChangeEnergy ManagementEmission ManagementResource Utilisation ManagementBiodiversity Conservation
Protection of Rights and Interests of EmployeesImproving Talent ManagementOccupational Health and Safety
Promoting Industry-based Welfare Promoting Health-based Welfare and CharityInvolvement in Public Welfare
OverviewThe report, covering the period from 1 January 2023 to 31 December 2023, is the seventh corporate social responsibility(CSR) report issued by Joincare Pharmaceutical Group Industry Co., Ltd. (Stock Code: 600380). In view of the continuity andcomparability of certain data, some contents of this report may be extended or traced back to other periods where applicable.Scope of the ReportThe report covers Joincare and its wholly-owned subsidiaries and holding subsidiaries.Preparation BasisThis report is prepared mainly in accordance with the No.1 Guidelines for Self-discipline Regulation of Listed Companies onthe Shanghai Stock Exchange - Operating in a Well-Regulated Manner and with reference to the Environmental, Social andGovernance (ESG) Reporting Guide published by the Hong Kong Stock Exchange (i.e. SEHK). To ensure the completeness,materiality, authenticity and balance of the content, the preparation of this report has gone through a systematic set of procedures,including identifying key stakeholders, identifying and prioritising material issues, determining the scope of this report,collecting relevant materials and data, reviewing the data and preparing the report based on the information gathered.DenitionsFor the sake of compendious expression and smooth reading, unless otherwise specified, “Joincare”, “the Company”, “theGroup”, “Group” and “we” mentioned in this report all refer to Joincare Pharmaceutical Group Industry Co., Ltd. This reportinvolves several subsidiaries of Joincare. Moreover, the full names and abbreviations of the subsidiaries used in the report arelisted below:
Company NameAbbreviationShenzhen Haibin Pharmaceutical Co., Ltd.Haibin PharmaXinxiang Haibin Pharmaceutical Co., Ltd.Xinxiang HaibinShenzhen Taitai Pharmaceutical Co., Ltd.Taitai PharmaceuticalJiaozuo Joincare Bio Technological Co., Ltd.Jiaozuo JoincareJoincare Haibin Pharmaceutical Co., Ltd.Joincare HaibinShanghai Frontier Health Pharmaceutical Technology Co., Ltd. Shanghai FrontierGuangzhou Joincare Respiratory Drugs Engineering Technology Co., Ltd.Guangzhou JoincareLivzon Pharmaceutical Group Inc. Livzon GroupSichuan Guangda Pharmaceutical Manufacturing Co., Ltd. Sichuan Guangda
The Report at a Glance
Corporate Social Responsibility Report 2023
Company NameAbbreviationShanghai Livzon Pharmaceutical Manufacturing Co., Ltd.Shanghai LivzonLivzon Group Livzon Pharmaceutical FactoryLivzon Pharmaceutical FactoryLivzon Group Limin Pharmaceutical Manufacturing FactoryLivzon LiminZhuhai Livzon Diagnostics Inc.Livzon DiagnosticsZhuhai Livzon Biotechnology Co., Ltd.LivzonBioZhuhai Livzon Microsphere Technology Co., Ltd.Livzon MicrosphereLivzon Group Xinbeijiang Pharmaceutical Manufacturing Inc.Livzon XinbeijiangGutian Fuxing Pharmaceutical Co., Ltd.Gutian FuxingJiaozuo Livzon Hecheng Pharmaceutical Manufacturing Co., Ltd.Jiaozuo LivzonLivzon Group (Ningxia) Pharmaceutical Manufacturing Co., Ltd.Ningxia PharmaceuticalZhuhai FTZ Livzon Hecheng Pharmaceutical Manufacturing Co., Ltd.Livzon HechengLivzon Group Fuzhou Fuxing Pharmaceutical Co., Ltd.Fuzhou FuxingLivzon MABPharm Inc.Livzon MABShanghai Livzon Biotechnology Co., Ltd., Jiaozuo BranchShanghai LivzonBioData Sources and Reliability StatementData and cases disclosed in this report are derived from official documents, statistical reports, relevant public informationand internal reporting documents. Joincare guarantees that this report does not contain any false representation or misleadingstatement and assumes liability for the authenticity, accuracy and completeness of this report.
Conrmation and Approval of this ReportThe contents of this report have been confirmed by the management and been approved by our Board of Directors on 2 April2024.Access and Response to the ReportThisreportcanbeaccessedordownloadedfromtheo?cialwebsiteoftheShanghaiStockExchange(www.sse.com.cn)andouro?cialwebpage(www.joincare.com).Shouldyouneedtomakefurtherinquiries,commentsorsuggestionsregardingthisreport,please contact us via fax (0755-86252165) or email (joincare@joincare.com).This report is originally written in Chinese, and this English version is for stakeholders’ reference only. Should ambiguities arisebetween the two versions, the Chinese version shall prevail.
Dear stakeholders and friends,
In 2023, the Healthy China Initiative has been promoted, the medical system reform has been deepened, andthecountryhasstronglysupportedpharmaceuticalR&Dandinnovation.Thankstothesee?orts,thenationalhealthpolicyandsystemhavebeenfurthersolidified.Giventhenewcircumstancesandrequirementsofthehealthcare industry, we actively respond to the changes and seize development opportunities while deliveringon our mission of “For the health, For the future”. Supported by technological innovation, we are committedto the dual-drive strategy of “innovative medicines + high-barrier complex formulations”, making ourcontribution to promoting national health during the 14th Five-Year Plan period.We continue to optimise corporate governance system and steadily improve our ESG system. In 2023,MSCI, an international authoritative index institution, upgraded Joincare’s ESG rating from “BBB” to“AA”,reachingaleadingpositionintheindustry.ThisUpgradefullyreectsthatourESGperformanceandsustainable development capability were highly recognised by the international capital market.Upholding fundamental principles, breaking new ground, and increasing investment in R&D, we have builta well-balanced pipeline that includes respiratory, gastroenterology, assisted reproduction, psychiatry andtumour immunity. And we also build innovative R&D technology platforms for inhalation administration,antibody, sustained-release microspheres, complex injection formulations, among others. Focusing on clinicalneeds,weendeavourtoimprovetheavailabilityanda?ordabilityofhigh-qualitypharmaceuticalproductsandservices. In 2023, Tobramycin Inhalation Solution (健可妥?),amodiednewdrugdevelopedindependentlyby the Group, was included in Class B of China’s National Reimbursement Drug List (NRDL). As China’srstinhaledantibiotics,健可妥?o?ersamoree?ectiveoptionforpatientswithbronchiectasis.Guided by clinical value, the Group expands its product matrix and R&D pipeline by developing short-termhigh-certainty R&D projects and technologies with long-term growth potential. At the same time, we activelyexplore cutting-edge technologies and development opportunities both domestically and internationally, andstrengthen cooperation with external organisations. The newly introduced influenza antiviral drug TG-1000Capsules has entered phase III clinical trials this year. As our innovation mode of “independent R&D asthe foundation and external introduction as an accelerator” gradually matures, we are striving to make solidstrides in innovation and reap practical fruits.
Chairman’s Statement
Corporate Social Responsibility Report 2023
Guided by the corporate value of “Putting People First”, we continue to safeguard the rights and interests ofemployees, smooth communication channels, and create a diversified and inclusive working environment.We also improve the compensation and welfare system and establish a targeted training system. In addition toensure occupational health and safety for employees, we are committed to addressing their concerns and sharethe fruits of corporate development with them.The Group takes concrete action to protect environment in accordance with the environmental managementapproach of “pollution prevention, legal compliance and continuous improvement”. In 2023, we published theClimateChangeManagementSystem.Accordingtothesystem,weareworkingtoenhanceenergye?ciency,increase green investment and make every effort to achieve carbon emissions peaking by 2028 and carbonneutrality by 2055. This is how we practice the green development concept that “lush mountains and clearwaters are invaluable assets”.Being a good corporate citizen, the Group has actively responded to the national call to invest in promotinga healthy China and revitalising rural. We continue our “Access to Public Welfare for Chronic DiseasesPrevention and Treatment Programme” to effectively alleviate the financial burden of low-income families.We fully support industrial assistance to effectively consolidate the achievements of poverty alleviation andpopularise medical knowledge in a well-organised manner to help enhance public health awareness. Joincarewill devote itself to meeting the needs of society and the expectations of the country. While maintaining aprudentapproach,wewilltaketheinitiativetofullourresponsibilities,andgivebacktosociety.Looking ahead to 2024, Joincare will strive to deliver sustainable value for various stakeholders and remaintruetoitscorevaluesof“Puttingpeoplefirst,Valuingworkmanshipandquality,Pursuinginnovationandtruth, Promoting cooperation and sharing”, to become a staunch advocator, supporter and executant of theHealthy China Initiative. Chairman: Zhu Baoguo April 2, 2024
3.1 Group Overview
The business scope of Joincare covers multiple areas, such as chemical pharmaceuticals, biologics, chemical activepharmaceutical ingredients (APIs) and intermediates, traditional Chinese medicine (TCM) drugs, diagnostic reagents andequipment,andhealthcareproducts.The Group has strong R&D capabilities and global R&D concepts in the fields of chemical pharmaceuticals, traditionalChinese medicine, biologics, diagnostic reagents, and healthcare products. Our R&D pipelines focusing on the fields ofrespiratory, anti-infection, anti-tumour, gonadotropic hormones, gastroenterology and neurology are refined and well-balanced. In recent years, we have devoted ourselves to innovating and improving monoclonal antibodies (MAB),inhalation formulations, long-acting sustained-release microspheres, complex formulations and other technologyplatforms. Through the efforts mentioned above, we further improve our product portfolios, business and corecompetitiveness.
About Joincare
Table: Main Products of the Group
Chemical Pharmaceuticals
Respiratory
Gastroenterology
健可妥?(Tobramycin InhalationSolution)
壹丽安?(Ilaprazole Enteric-CoatedTablets)
丽舒同?(Levosalbutamol HydrochlorideNebuliser Solution)
壹丽安?(Ilaprazole Sodium for Injection)
雾舒?(Budesonide Suspension forInhalation)
丽珠维三联?(Bismuth Potassium CitrateTablets/Tinidazole Tablets/Clarithromycin Tablets)
丽雾安?(Ipratropium BromideSolution for Inhalation)
丽珠得乐?(Bismuth Potassium Citrate
Tablets)
Corporate Social Responsibility Report 2023
Biologics
Chemical APIs and intermediates
丽康民?(Recombinant SARS-CoV-2Fusion Protein Bivalent(Prototype/Omicron XBBVariant) Vaccine (CHO Cell) )
安维泰?(Tocilizumab Injection)
丽得宝?(Recombinant HumanChoriogonadotropin alfa forInjection)
丽康乐?(Mouse Nerve Growth Factorfor Injection)
贝依?(Leuprorelin AcetateMicrospheres for Injection)
维宝宁?(Triptorelin Acetate Microspheres
for Injection)丽申宝?(Urofollitropin for Injection)
丽曲欣?(Cetrorelix Acetate Powder for
Injection)
Gonadotropic hormones
倍能?(Meropenem for Injection)
丽福康? (Voriconazole for Injection)
Anti-infection
瑞必乐?(Fluvoxamine Maleate Tablets)
康尔汀?(Perospirone HydrochlorideTablets)
Psychiatry
Drugs for humans:
7-ACA, Meropenem Trihydrate, Daptomycin, Dalbavancinee, Vancomycin, Mevastatin and Acarbose
Veterinary drugs:
?? Milbemycin Oxime and Moxidectin
Healthcare products
TCM drugsDiagnostic reagents and equipment
JingxinOralLiquid
Anti-tumourShenqiFuzhengInjection
Eagle’s American Ginseng Tea
Cold medicineAnti-viral Granules
TaitaiOralLiquid
Mycoplasma pneumoniae IgMAntibody Test (Colloidal gold
method)
Eagle ’s American GinsengTea Beverage
Antinuclear Antibody TestKit (17) (Magnetic BarcodeImmunouorescence)
3.2 Organisational Structure
Shareholders’ Meeting
Board of DirectorsBoard of Supervisors
O?ceoftheBoardofDirectors
CEO
Remuneration CommitteeStrategy Committee
Nomination CommitteeCSR CommitteeAudit Committee
SalesManagementCentreProductionManagementCentreR&DManagementCentreIntegratedManagementCentreFinancialManagementCentre
Supervisionand AuditDepartment
Corporate Social Responsibility Report 2023
3.3 Corporate Culture
Sincetheestablishmentin1992,Joincarehasconstantlybeenfocusingontheeldofhealthcare,alwaysstayingtruetoits original aspiration in its ongoing inheritance and innovation. Gradually, we have formed a corporate mission - “For thehealth, For the future”. Along this journey, we always act in the interests of patients and focus on safeguarding human lifeandhealth.Wetakescienticandtechnologicalinnovationasthestrategicfoundation,adheretothedual-drivestrategyof "Innovative Medicines and High-Barrier Complex Formulations", and carefully conceive a new vision of “Diligentlymakehigh-qualitydrugsandinnovativedrugs”.Inaddition,weactivelyandcontinuouslycontributetobuildingacommunity with a shared future for the public. Even while focusing on business development, we take “Putting peoplefirst,Valuingworkmanshipandquality,Pursuinginnovationandtruth,Promotingcooperationandsharing”ascorevalues.Weconsiderthequalityofproducts,thetrainingoftalents,andthestrengthofR&Doftheutmostimportance,therebyadvocatingthecoexistenceofthehumanisticspiritandthescienticspirit,andactivelyassumingobligationsandresponsibilities for the development of human health.
MissionVisionCore values
For the health, For the futureDiligentlymakehigh-quality
drugs and innovative drugs
Puttingpeoplerst,Valuingworkmanashipandquality,Pursuing innovation and truth,Promoting cooperation and sharing
3.4 Key Performance
During the reporting period, Joincare achieved total revenues of RMB16.646 billion, representing a year-on-year decreaseof 2.90%; achieved net profits attributable to shareholders of the listed company of RMB1.443 billion, representing ayear-on-year decrease of about 3.99%; and achieved net profit attributable to shareholders of the listed company afterextraordinary gain or loss of RMB1.374 billion, representing a year-on-year decrease of about 3.18%.At the same time, the Group has been actively undertaking corporate social responsibilities and constantly creating socialvalue. In 2023, the Group generated tax revenues for the government of RMB1.866 billion, paid RMB2.460 billionin salary to employees, distributed dividends and paid interest worth RMB1.615 billion to banks and other creditors,donated funds and goods totalling RMB 25.985 million to society, and achieved a social contribution per share ofapproximately RMB3.97 for the society in 2023.Total revenues
16.646
billionSalary to employees
2.460
billion
Netprotsattributabletoshareholders of the listed company
1.443
billionDonated funds and goods
25.985
million
Tax revenues for the government
1.866
billionSocial contribution per share
3.97
February 20232022 China Pharmaceutical SocialResponsibility Media Observation -Responsibility PioneerNational Medical ProductsAdministration Institute of MedicalEconomics, https://www.yyjjb.com.cn/
March 2023
Guangdong PharmaceuticalIndustry Anti-EpidemicPioneerGuangdong PharmaceuticalProfession Association
April 2023Best ESG InformationDisclosure Award
NewFortune
May 2023Certication of Inclusion in the Key Trademark Protection List inGuangdong Province - Dexamethasone Acetate
Key Trademark Protection Committee of Guangdong TrademarkAssociationHealth Promotion Enterprise (Silver Award)Shenzhen Health Education and Promotion Centre under the HealthCommission of Shenzhen Municipality
June 20232023 TOP 100 China's Chemical Drug R&DStrength Rankingwww.yaozh.com, China Pharmaceuticals Magazine
2023 TOP 100 China Drug R&D ComprehensiveStrength Ranking
www.yaozh.com, China Pharmaceuticals MagazineNo. 9 in China's Top 100 ChemicalPharmaceutical Enterpriseswww.menet.com.cn
3.5 Honours
Corporate Social Responsibility Report 2023
July 2023ESG New Benchmarking Enterprise AwardStockStarESGAlliancewithJointE?ortsandSharedBenets2022 Annual Outstanding Enterprise in thePharmaceutical Corporate Social Responsibility List bySouthern WeeklyChina Corporate Social Responsibility Research Centre ofSouthern Weekly
September 2023
No. 441 in 2023 Top 500 China'sManufacturing Private EnterprisesAll-China Federation of Industry and CommerceNo. 40 in 2023 Top 100 Manufacturing PrivateEnterprises in Guangdong ProvinceGuangdong Federation of Industry & CommerceNo. 71 in 2023 Top 100 Private Enterprises inGuangdong ProvinceGuangdong Federation of Industry & Commerce
October 20232023 Excellent Practice Cases of ListedCompanies in Rural RevitalisationChina Association for Public CompaniesTop 20 Board Governance of ListedCompanies in the Greater Bay Area
Shenzhen Research Association of CorporateGovernance
November 20232023 Excellent Practice Cases of the Best PracticeCreation Activity of the Board of Directors of ListedCompaniesChina Association for Public CompaniesNo. 65 in 2022 Top 100 Enterprises in China'sPharmaceutical IndustryMinistry of Industry and Information Technology, thePeople's Government of Beijing Municipality, NationalHealth Commission, State-owned Assets Supervision andAdministration Commission of the State Council, StateAdministration of Traditional Chinese Medicine, andNational Medical Products Administration2023 Guangdong Pharmaceutical Industry AdvancedEnterprise for Statistics WorkGuangdong Pharmaceutical Profession Association
Joincare believes in the paramount importance of performing corporate social responsibility (CSR) to long-term and sustainabledevelopment. We integrate the CSR strategy into our daily operations and management to constantly improve CSR governanceof the Group. We actively communicate with stakeholders to understand and respond to their demands. We make unremittinge?ortstostrengthencompliancemanagementbyestablishingacomprehensiveriskmanagementsystem.Adheringtotheparty-massesspirit,wecarryoutbusinessactivitiesinanuprightandself-disciplinedmanner.Bydoingso,welayasolidfoundationfor the sustainable development of the Group.
SDGs in this section
Responsible Governance
Corporate Social Responsibility Report 2023
4.1 CSR Strategy
Committed to promoting social development, Joincare puts great efforts into the healthcare industry with innovation tohelp build a Healthy China and create a green, bright and prosperous future with stakeholders. Focusing on “health”,theGroupalignsitsCSRstrategywithitsdevelopmentstrategytoguideitse?ortstopromotesustainabledevelopment.Wearecommittedtoprovidingthewholesocietywithhigh-quality,safe,accessibleandaffordablemedicalproductsand services to better meet the clinical needs. In addition, we pay close attention to demands of internal and externalstakeholders and constantly strengthen management of areas in relation to sustainable development. We continuouslyempower our employees' growth, actively undertake responsibility of environmental protection and dedicate to socialwelfare.Thesee?ortsareaimedtopromotesocialharmonyanddevelopment.
4.2 CSR Governance
Effective CSR governance system is a strong support for Joincare to implement CSR strategy and achieve CSR goals.The Group has established a CSR management structure that consists of the Board of Directors, the Corporate SocialResponsibility Committee and the Corporate Social Responsibility Working Group. We have formulated and releasedthe Corporate Social Responsibility Management Policy of Joincare, which clarifies the duties and work scope of themanagement at all levels and standardises the division of labour among functional departments. ESG indicators havebeen incorporated into the individual performance assessment of all members of our CSR working group since 2022.
Joincare CSR Management Structure and Responsibility
In addition, to improve the Group’s CSR and ESG management, we pay close attention to ESG cutting-edge trend,actively understand the ESG hot topics and seize the opportunities in the capital market, and keep abreast of the latestregulatory developments relating to sustainable development. We organise training on CSR and ESG management everyyear. In 2023, we invited external experts to conduct special training on sustainable development. The training is aimedto strengthen management’s awareness of sustainable development and help them to understand and learn about excellentmanagement practice, thus improving our ESG management performance.
Board ofDirectors
SocialResponsibilityCommittee
SocialResponsibilityWorking Group
It is the highest decision-making body, which makes decisions on all major mattersrelating to social responsibility.It is composed of three directors, including one independent director, and is chaired bythe chairman of the Board of Directors, and takes charge of:
? researching and preparing the Group's CSR strategy, goals and policies, and reviewingCSR planning and measures;
? supervising the Social Responsibility Working Group of the Group;? monitoring, inspecting, assessing and proposing advice on the Group's fulfilment of
social responsibilities;
? questioningonthemajormattersthataffecttheGroup'sfulfilmentofsocial
responsibilities, inspecting and urging the handling of related matters.The Social Responsibility Working Group is mainly composed of major functionaldepartments, such as the Office of the Board of Directors, the Quality ManagementDepartment, the EHS Department, the Human Resources Department, etc., with theGroup's President as the leader, and takes charge of:
? daily work liaison, reporting and meeting organisation;? coordinated implementation of social responsibilities.
4.3 Communication on CSR
4.3.1 Communication with Stakeholders
Joincare values the opinions of stakeholders. By establishing a regular and diversified mechanism to communicatewith stakeholders, we constantly strengthen our relation with stakeholders. We promptly understand and respond tostakeholders’ demands through various convenient channels, aiming to achieve positive interaction with stakeholders andcreate long-term value for stakeholders.Table:CommunicationrequirementsofandmethodswithstakeholdersStakeholdersCommunicationRequirementsCommunication Methods
Employees
Protecting employees’ rights and interestsCaring for employees and communicatingwiththemtoknowtheirrequirementsProvidingsalariesandwelfarebenets,aswell as training for development
Workers' congresses and labour unionEmployees' satisfaction surveyOccupational health and safety trainingPlatforms for feedbackDaily communication
Investors
Conducting standardised governance andstrict risk controlEnsuring sound operation and valuecreationProviding open and transparentinformation disclosure
Shareholders' meetingRegular releases of business information and dataTelephone, fax, email, and the general meetingInvestor's survey, platforms for interactive communicationand exchange, and external roadshowsWeChato?cialaccountConsumers
Guaranteeing product safety andconsumers' rights and interestsProtecting privacy and observing businessethics
Product labelling and information disclosureRegular visitsConsumers' satisfaction surveyHandling of complaints and opinionsDistributors,suppliers and partners
Guaranteeing honest business operationand pharmaceutical complianceFacilitating timely communication andwin-win development
Regular communicationWorking meetings and exchanges via telephone andcorrespondenceCompany’s website
Government andregulators
Working in compliance with laws andensuring drug safetyCooperating with the government'sregulations and operating in light ofregulationsPaying taxes in accordance with laws andcreating jobs
Government-enterprise symposiumsSupervision and inspectionWork reports and surveysOn-site inspection
Media
Promotinge?ectiveinteractionandinformation disclosure
Company’swebsiteandWeChato?cialaccountInteractive communication platformsSpecial reportsExternal roadshowsPharmaceuticalindustry associations/organisations
Promoting fair competition andexperience sharing
Industry organisation meetingsExperience sharing sessionsSite visitsCommunity/The public
CharityBoosting community development andcreating social value
Volunteering activitiesMoney and medicine donationMedicine knowledge publicity
Corporate Social Responsibility Report 2023
4.3.2 Decision of Material Issues
The Group continuously conducts stakeholder survey and incorporates annual materiality assessment into the riskmanagement process. To fully understand the concerns and expectations of stakeholders, this year, we invited internal andexternalstakeholderstoparticipateinquestionnairesurveys.Throughthesurveys,weprioritisedmaterialissuesbasedonourfullidenticationandassessmentofmateriality,andrespondedtoallissuesinthisreportbasedontheassessmentresult.We determine the materiality of issues by following four steps:
Highly Material IssuesGenerally Material IssuesModerately Material Issues
Product Quality and SafetyEmission ManagementOccupational Health and SafetyIntellectual Property Rights ProtectionEmployeeRemunerationandBenetsBusiness Ethics and Anti-Corruption
Protection of Labour Rightsand InterestsTalent Attraction, Retentionand DevelopmentWater ResourcesManagementCustomer Privacy and DataSecurityRisk ManagementSustainable Supply ChainManagementCorporate Governance andCompliance
Diversity,EqualityandInclusivenessResponsible MarketingResource ConsumptionManagementInvestor Relations ManagementIndustry Development andCooperationAccess to Healthcare
EnergyE?ciencyandManagementBiodiversityConservationClimate ChangeMitigation andAdaptationCharity
1017
Identication of issues
Material issues for the current year are identified based on reporting standards,peer benchmarking, and industry sustainability trends and in the light of theGroup's business development.
Research on issues
Stakeholders, such as senior management, suppliers, investors, consumers andgovernment departments, are invited to participate in the survey in the form ofquestionnairetounderstandtheirkeyconcerns.
Prioritisation of issues
Based on the results of peer benchmarking and communication with stakeholders,the issues are prioritised from two dimensions of the materiality to externalstakeholders and to Joincare.
Review of issuess
According to the results of materiality assessment, a matrix of material issues forthe year and the focus areas of the report are determined. The results of materialityassessment are submitted to management and disclosed in the report after reviewby management and approval by the Board of Directors.
Importance on Stakeholders
Product R&D andTechnological Innovation
Importance on Enterprise Development
4.3.3 Support for United Nations Sustainable Development Goals
As a responsible corporate citizen, the Group strives to improve the CSR management system, and actively engagesin a wide range of areas such as pharmaceutical innovation, access to healthcare, environmental protection and ruralrevitalisation, aiming to support the achievement of United Nations sustainable development goals (SDGs) with ouractions.
SDG1: No PovertyEnd poverty in all its forms everywhere.
SDG3: Good Health and Well-beingEnsure healthy lives and promotewell-being for all at all ages.
SDG4: Quality Education
Ensureinclusiveandequitablequalityeducationandpromotelifelong learning opportunities for all.
Section
Section
Section
Public Welfare and Charity
Access to Healthcare
Talent Management
Examples of Our Actions
Examples of Our Actions
Examples of Our Actions
?We carried on the long-term “Access to Public Welfare for Chronic DiseasesPrevention and Treatment Programme” to donate drugs to patients withnancialdi?cultiesinremoteareaswhosu?erfromchronicdiseases.?We implemented the “Astragalus Root Industry Revitalisation” plan,supporting rural economic development through industry assistance.?We donated a total of RMB 20 million in relief funds and medical supplies totheearthquake-strickenareasinGansuProvince.
?Joincare’smodiednewdrug健可妥?was included in Class B of NRDL asChina’srstinhaledantibiotics.?The emergency use of the two COVID-19 vaccine丽康? and丽康民?has beenapproved.?We built a popular science new media platform matrix called “RespiratoryExperts’ Views” to promote knowledge on chronic respiratory disease and givetreatment support for the public.?We provided training for local healthcare workers in developing countries,contributingtoimprovingthequalityandcapacityofhealthservices.
?We cooperated with higher education institutions to deliver joint trainingprogrammes and provided students with traineeship positions.?We tailored job-specific development training programmes according to thecharacteristicsandbusinessneedsofdi?erentpositions.?We encourage continuing education and support employees to obtainacademicdegreeorprofessionalcertications.
Corporate Social Responsibility Report 2023
Section
Examples of Our Actions
SectionExamples of Our Actions
SectionExamples of Our ActionsSDG6: Clean Water and sanitationEnsure availability andsustainable management of waterand sanitation for all.
SDG7:A?ordableandCleanEnergy
Ensureaccesstoa?ordable,reliable, sustainable and modernenergy for all.
SDG8: Decent Workand Economic GrowthPromote sustained, inclusive andsustainable economic growth, fulland productive employment anddecent work for all.
SDG5:GenderEquality
Achievegenderequalityandempower all women and girls.
Section
Operating with Green Sustainability
Operating with Green Sustainability
Talent ManagementPublic Welfare and Charity
Talent ManagementExamples of Our Actions
?Byinstallingonlinewastewatermonitoringequipmentattheeffluentoutlets of major wastewater discharge plants and networking with regulatoryauthorities, we monitored and shared real-time discharge data of treatedwastewater.?Through improving wastewater treatment processes and upgradingwastewater treatment facilities, we decreased wastewater discharge, increasedwastewater utilisation, and reduced the concentration of pollutants inwastewater.
?We took steady steps to develop the energy management system based on ISO50001 standards.?We took measures to improve energy use efficiency for energy conservationand emission reduction, increased the investment in green production projectsand strived to build a low-carbon and energy-saving green productionenterprise.
?We have formulated the Code of Labor Employment and Ethical Conduct tospecify provisions on protecting labour rights as the prohibition on forced andchildlabour,equalremuneration,etc.?We strengthened education and training on protecting human rights, strictlyreviewed the implementation of human right policies, and actively takeimprovement actions.?We provided professional training for local managers through the “AstragalusRoot Industry Revitalisation” plan.
?We set a diversity target of “no less than 49% female employees by 2032”.?We provided various of material benefits and special care for femaleemployees, such as maternity leaves, breastfeeding leaves and customisedphysical examination services.
Section
Examples of Our Actions
Section
Examples of Our Actions
SDG10:ReducedInequalitiesReduceinequalitywithinandamong countries.
Access to HealthcareTalent Management?Weadoptedinter-countryandintra-countryequitablepricingpoliciesbasedonproducta?ordability.?We were deeply committed to the development of healthcare and activelyinvolved in capacity advancement initiatives for healthcare in developingcountries.?We prohibited any forms of discrimination and prejudice, defined escalationprocess and disciplinary actions, and apply for social insurance subsidies forthe employees with disabilities.
SDG12: Responsible
Consumption and ProductionEnsure sustainable consumptionand production patterns.
Safeguarding Product QualityOperating with Green Sustainability?Wetookproductquality,safety,health,environmentalprotectionandotherelements into account to minimise the negative impact that our products mayhave on the environment and society in the whole product life cycle.?We classified waste for treatment, and actively promoted waste reduction,recycling and harmless disposal by introducing advanced environmentalprotection technology into production, upgrading original productiontechnology and formulations, and cooperating with third parties.
SDG13: Climate ActionTake urgent action to combatclimate change and its impacts.
Operating with Green Sustainability
?We developed the Climate Change Management System, set out theGroup’s procedures for identifying and assessing climate-related risks andopportunities,aswellastherequirementsforimplementingandmonitoringtheresponse measures.?We identified and assessed the climate-related risks and opportunities facingour business and determined response measures to improve the overall abilityto manage climate risks.?We set the carbon emission target from 2022 to 2025 and the target toachieving carbon peaking by 2028 and carbon neutrality by 2055.
Section
Examples of Our Actions
Corporate Social Responsibility Report 2023
Section
Examples of Our Actions
Section
Examples of Our Actions
Section
Examples of Our Actions
SDG15: Life on Land
Protect, restore and promotesustainable use of terrestrialecosystems, sustainably manageforests,combatdesertication,halt and reverse land degradation,and halt biodiversity loss.
Operating with Green Sustainability
?We strictly comply with the laws and regulations related to biodiversityconservation.?We identified environmental risk factors and hidden hazards before buildingfactories,metthe“ecologicalredlines”requirementsandavoidedoperatinginareas of high biodiversity value, such as those close to government-designatedecological reserves.
SDG16: Peace, Justice and
Strong InstitutionsPromote peaceful and inclusivesocieties for sustainable development,provide access to justice for all andbuilde?ective,accountableandinclusive institutions at all levels.
Responsible GovernanceTalent Management
?We issued Anti-Corruption and Anti-Commercial Bribery System and theAnti-Fraud System, strengthened audit and supervision, and conducted trainingon business ethical standards.?Werequiremanagement,employees,andpartnerstocomplywithbusinessethics and clearly implement the anti-corruption management responsibility.?We have built a smooth and confidential grievance escalation and reportingprocedures for employees to support them to timely complain or report theviolation of labour rights and any dissatisfaction.
SDG17: Partnership for the GoalsStrengthen the means ofimplementation and revitalize theglobal partnership for sustainabledevelopment.
Public Welfare and Charity
?Dr. Jin Fang, the chief scientist of the Group, attended a number ofinternational conferences as a member of Medical and Chemicals TechnicalOptions Committee (MCTOC), focusing on research and reporting relatedto MDI inhaler propellant substitution, thus contributing to the fulfilment ofMontreal Protocol in the world.
4.4 Compliance Governance
JoincarestringentlyabidesbytherequirementsoftheCompanyLawofthePeople’sRepublicofChina(PRC),theSecurities Law of the People’s Republic of PRC, the Code of Corporate Governance for Listed Companies, the RulesGoverning the Listing of Stocks on the Shanghai Stock Exchange and other relevant laws, regulations and regulatorydocuments. We keep improving the internal management system and strengthen information disclosure management andinvestor relations management. By doing so, we constantly improve our corporate governance.
4.4.1 Protection of Shareholders’ Rights and Interests
Joincare standardises the procedure of convening general meetings and voting at the general meeting in accordance withthe Articles of Association, the Rules of Procedure for General Meetings and other relevant regulations to ensure thateachshareholderistreatedequally.Wemakefulluseofinformationtechnologiessuchasonlinevotingtoensurethatallshareholders, especially our minority shareholders, can exercise their right to know and participate in decision-making inamoree?cientande?ectiveway.Relying on its independent business and autonomous operation ability, Joincare always maintains independence. TheGroup and its controlling shareholder implement independent management and accounting in business, personnel, assets,institutionandnance.ThecontrollingshareholderoftheGroupexercisesitsrightsandassumesitsobligationsinstrictaccordance with laws and regulations. It does not directly or indirectly interfere with the decision-making and businessactivities of the Group by bypassing the general meetings. Furthermore, we have established a long-term mechanismfor preventing the controlling shareholder or the de facto controller and other related parties from occupying funds ofthe listed company and infringing upon the interests of the listed company and formulated the Policy for Preventingthe Controlling Shareholder or the De Facto Controller and Other Related Parties from Occupying Company Funds.Thesee?ortsaremadetoensuresteadydevelopment.Thisyear,nodisputesarosefromtheappropriationoftheGroup’sassets by the Group’s controlling shareholder, or the de facto controller and other related parties and the detriment of theinterests of the Group and the minority shareholders.
4.4.2 Performance of Duties of Directors and Supervisors
Committed to strengthening governance, Joincare keeps improving the management structure of the Board of Directorsto build a more professional and diverse Board. We have formulated and disclosed the Board Diversity Policy to ensurethat a series of criteria are taken into account when the Nomination Committee selects Board members. Selection criteriainclude those in relation to educational backgrounds, professional experience, expertise and tenure, and diversifiedfactors such as gender, age, nationality, cultural backgrounds and ethnicity are also included. At the same time, wedisclose measurable targets for the implementation of the diversity-related policies and relevant progress in the socialresponsibility report on an annual basis.
Corporate Social Responsibility Report 2023The number of members of the Board of Directors
is nine (four independent directors in total); there are three femaledirectors, accounting for over 30% of the total. Members of the Board of Directors have backgrounds and expertise inthepharmaceuticals,corporatemanagement,nance,accounting,lawandproduction.Basedontheirextensiveindustryexperience, they can provide strategically forward-looking opinions for the Group’s governance and development.In addition, the Board of Directors has established the Audit Committee, the Remuneration Committee, the StrategyCommittee, the Nomination Committee and the Corporate Social Responsibility Committee. It has given full play totheprofessionaladvantagesofeachcommitteetoassistinlegal,compliant,scienticandaccuratedecision-makingandensure the integrity and transparency of governance procedure. There are three supervisors in the Supervisory Committeeof Joincare, including one employee representative. The Supervisory Committee performs its duties in accordance withthe law, supervises the performance of duties of the Group’s directors and senior management, regularly inspects theGroup’snancialpositionandperformance,paysattentiontotheGroup’smajorinvestmentprojects,andfullysafeguardsthe interests of the Company and all shareholders.The Company’s directors, supervisors and senior management make full use of various channels to participate in varioustraining on the standardized operation of listed companies (including but not limited to various specific training orforums, continuing professional development courses, internal training, reading regulatory newsletters or enforcementbriefings on listing rules issued by the Stock Exchanges, China Securities Regulatory Commission, etc.), which containthe latest changes in industry policies, information on the regulation of listing and company's code of business ethicsetc., to continuously improve their ability to perform their duties.
4.4.3 Disclosure Transparency
In strict accordance with relevant standards and guidelines of the China Securities Regulatory Commission (CSRC) andthe Shanghai Stock Exchange (SSE), the Group has formulated the Management System for Information DisclosureA?airs,whichclariesrequirementsfortheGroup’sinformationdisclosureandrequiresactivefullmentofinformationdisclosure obligations. To better meet the demands of investors, we make continuous innovations in the forms ofinformation disclosure, enrich the content of disclosure and strengthen voluntary information disclosure. To safeguardtheinvestors'righttoknow,wediscloseourmanagementthroughvariouschannelssuchastheGroup'so?cialwebsite,mediareportsandWeChato?cialaccount.In 2023, we filed and disclosed 220 documents in compliance with the information disclosure principle of authenticity,accuracy, integrity, timeliness and transparency, with a total Chinese character count of 2.94 million, outperforming 95%of our A-share listed peers. Our information disclosure has been highly recognised by regulators and capital market.In 2023, Joincare was again rated “A” (Excellent) in the information disclosure assessment over listed companiesorganisedbytheShanghaiStockExchange.It'sthethirdyearinasequencewegotthisrating.Wealsowontheawardof the “Excellent Practices of the Office of the Board of Directors” in the “Best Practices of the Office of the Board ofDirectors” selection held by the China Association for Public Companies (CAPCA), making us a winner of this award fortwo consecutive years.
Board members and the date of formal appointment: Zhu Baoguo: December 1992; Liu Guangxia: July 1995; Yu Xiong: August 2021;QiuQingfeng:August2006;LinNanqi:December2019;HuoJing:May2019;QinYezhi:May2020;PengJuan:August2021;YinXiaoxing: September 2023.
4.4.4 Investor Relations
Focusing on investor relations management, Joincare has formulated and implemented the Regulations on InvestorRelations Management while establishing a sound communication mechanism to facilitate engagement with investorsthrough various channels. The Board of Directors designates special department and employees to take charge ofinformationdisclosureandinvestorrelationsmanagement,promptlyrespondtoinvestors’inquiry,andearnestlylistentotheir suggestions and opinions. By doing so, we aim to achieve positive interaction with investors.Toenhanceourconnectionwithmediumandsmallinvestors,theO?ceoftheBoardofDirectorsdesignatespersonneltoprovide Q&A for investors via SSE e-interactive platform, answer their phone calls and reply to their emails. In 2023, weprovided 95 Q&A for investors via SSE e-interactive platform and answered 345 phone calls from them and published 16articlesonourWeChato?cialaccount.Theconcernsaddressedincludecorporateperformance,businessconditions,IRevents, and investment progress.Thisyear,tofurtherstrengthenourrelationswithinstitutionalinvestors,weheldthreeonlineperformancebriengsandone activity “Visiting Listed Companies”. Furthermore, we actively participated in the 2023 Listed Company Investors'OnlineCollectiveReceptionDayeventinShenzhen,whereweansweredinvestors'questionsontheoperationoftheCompany and other aspects in detail. We also maintain regular communication with over 20 institutional investors,presenting to them our business conditions and investment value. In terms of international investor relations management,we keep expanding the channel of communication with international investors by launching the Global DepositoryReceipt (GDR) in Switzerland. In November 2023, we participated in the 22nd Asia Pacific Summit held by MorganStanley. At the Summit, we introduced our overseas expansion plan to over 10 top family offices in Singapore, aimingto seek cooperation. In addition, we participated in overseas roadshows in the United Arab Emirates, Switzerland, andothercountries.Throughtheseactivities,weshowedoverseasinvestorsinformationaboutourbusinessmodel,nancialposition, development strategy, etc., which enabled overseas investors to have a deeper understanding of our strength andpotential, effectively enhanced our reputation and influence, and better publicised our value. Also, we received positiveresponses from broad mass of investors.Thanks to our unremitting efforts and progress in corporate governance, information disclosure, investor relationsmanagement, market value management, promotion and management of public opinion, Joincare has gained widerecognition from the capital market and all sectors of society. In 2023, we were invited to the Crystal Ball Award andwon the title of “Most Promising Listed Company”. Also, we won “Best ESG Information Disclosure” award from NewFortune and other awards. In addition, the Board Secretary won honours such as the “Golden Board Secretary” (19thsession) award from New Fortune, the “Tianma Award - Outstanding Board Secretary for Investor Relations” award, andthe 5A rating in “2023 Performance Appraisal on Board Secretaries of Listed Companies” held by China Association forPublic Companies (CAPCA).
2023 Most Promising Listed Company
2023 Outstanding Board Secretary for
Investor Relations award
Corporate Social Responsibility Report 2023
4.5 Risk Management
4.5.1 Comprehensive risk management
The Group has established a well-developed risk management system by formulating and implementing theComprehensive Risk Management System and building a risk management organisational structure to regulate riskassessment and management process. We also set overall risk management goals to improve overall risk prevention andcontrol. The Board of Directors, as the highest decision-making body in comprehensive risk management, takes charge ofsupervisingriskmanagementpractices.TheAuditCommitteetakeschargeofreviewingthee?ectivenessofoverallriskidentification, assessment, internal management and monitoring procedures. Management, as the execution body, takeschargeofthee?ectivenessofcomprehensiveriskmanagementtotheBoardofDirectors.Allfunctionaldepartmentsplaytheir roles in supporting the implementation of risk management procedure. The Supervision and Audit Department, asthe leading management department of comprehensive risk management, takes charge of conducting risk managementunder the guidance of the Audit Committee.We continuously collect information, identify internal and external risks, formulate comprehensive risk managementstrategies and implement actions to address risks. Furthermore, we monitor risks and give relevant early warning. Weconduct periodic risk reporting, monitor and evaluate the implementation and effect of risk management, and rectifyissues identified. We review risk exposure encountered by the Company on an annual basis. Against financial and non-financial risks in main business and other high-risk areas, we assess the internal controls and engage independent third-part agencies to conduct external risk audit. We also conduct impairment testing of goodwill using sensitivity analysis.Throughe?ectiveriskmanagementprocesses,weaimtominimisetheimpactofadversefactorsandsafeguardthesteadyandqualitydevelopmentoftheGroup.
4.5.2 Emerging Risks
The Group has identified and assessed emerging social and environmental risks that might influence the long-termdevelopmentoftheGroup,andimplementede?ectiveresponsesinoperationtopreventormitigatesuchrisks.
4.6 Carrying Forward the Party-Masses Spirit
Guided by Xi Jinping's Thought on Socialism with Chinese Characteristics for a New Era, the general Party branch ofJoincareacknowledgesandimplementsthegeneralrequirementsforPartybuildinginthenewera.Focusingonthecentral tasks and serving the overall interests, we create 7 “Party building+” brands, with a view to highlighting theroleof“Partybuildingengine”inallaspects.Westringentlyenforcethe“rsttopic”principle(startingeveryimportantParty member meeting with the learning of the Party or President's instructions), and continuously practise the policy of“holding Party branch general meetings, meetings of Party branch committees, Party group meetings, and Party lectures”.Also, we are strengthening the engagement between the Party and the people, and actively promoting the coverage ofParty organisations and Party work at the primary level. We comprehensively implement the development concepts ofinnovation, coordination, green, openness and sharing, to help invigorate the market competitiveness of enterprises.
Changes in industry policies
ApplicationofArticialIntelligence
Risk and impact description
Pharmaceutical industry is susceptible to changes in industrypolicies. With the continued deepening of healthcare reformand the advancing of the industry's supply-side structuralreform, a number of industry policies, such as the revisionsto the Drug Administration Law, the acceleration of GenericDrug Consistency Evaluation, the adjustments to the list ofmedicines covered by the medical-insurance system, and theexpansion of volume-based procurement, have been rolledout successively. This creates enormous challenges to thepharmaceutical industry for its future development. In 2023,one major products of Joincare won the bid for the ninthrounds of centralised procurement. This will exert significantinuenceonthesalespriceandmarketsharesinthefuture.
We closely monitor the industry developments and reforms,and address significant changes in pharmaceutical industrypolicies through early investment, early transformationand early compliance. To continuously improve our corecompetitiveness, we intensify efforts in R&D and innovationof new products, thereby achieving R&D-driven development.In addition, the Group actively seeks for contracts underand participates in the negotiations relating to the NRDL.Continuous efforts are made to expand hospital coverageand product sales. In this way, we achieve “selling more atlower prices”, diminishing the influence of price adjustmentfor medical insurance payment on the steady growth of theCompany's performance.
Mitigating actions
Risk and impact description
AI technology plays a vital role in promoting the developmentof medical and health services. However, AI is facing variouschallenges and uncertainties as its application in healthcareindustry is still in its early stages. In recent years, Joincarehas taken the lead in investing in AI drug R&D. We havebeen working with Tencent Quantum Lab on the researchofgenome,geneclusterandfunctionalelementsequencepredication and metabolic pathway optimisation through AItechnology. As AI relies much on extensive and accurate datainputs,low-qualitydataornon-representativedataappliedmayresult in discrepancies in research results, or even bad, harmfulor discriminatory results.
With the rapid development of AI technology, the global dataintegration and management mechanism is expected to befurther improved in the future while data barriers betweenmedical institutions, government departments and socialthird-party agencies are broken down. This will enableus to significantly improve efficiency of data production,acquisitionandarchiving.Wewillalsokeepabreastoftheregulatory developments relating to AI application in the fieldof healthcare. Sustained efforts are made to optimise our datamanagement and strengthen risk prevention and control in theprocessof“quantumcomputation+AI”application.
Mitigating actions
Corporate Social Responsibility Report 2023
In 2023, the 22nd “Walking Party Lecture” organised by Shenzhen High-tech Zone Party Committeebrought lecturers to the Joincare Office of Secretary for the biopharmaceutical industry chain. Theyvisited and understood on site the excellent practice of Joincare in Party building, corporate operationand management, product R&D and innovation. During the visit, NPC Deputy Jin Fang gave a Partylecture to representatives of the High-tech Zone Party Committee. In the lecture, the Deputy sharedthe Spirit of Two Sessions and Cutting-edge Developments in the Biopharmaceutical Industry, andbrought us details of the grand “two sessions”, including the core messages in General Secretary XiJinping’s speech and two sessions’ spirit. She also exchanged her feelings and experience from the“two sessions” with the representatives of the High-tech Zone Party Committee.
In 2023, we carried out a Party's Day activity: organising Party members to visit Shenzhen NantouAncient Town, with a view to searching for red memory and looking back into the history of reformand opening up in Shenzhen, thereby fostering our resolution to forge ahead toward a brighter future.In addition, we held a series of “Red Tour” activities and organised Party members and cadres to visitShenzhen Nanshan District Party Building Park, where we relived the glory days of the Party andsearchedforredmemory,enablingustoforgeaheadwithrmbelief.
“Walking Party Lecture” introduced to Joincare
Joincare organised Party member activities
We keep improving Party building work and fully enhance the cohesion of corporate Party branches at all levels. In2023, we led the establishment of the “Office of Secretary” in Shenzhen Nanshan District for the biopharmaceuticalindustry chain. This will give full play to Party building organisation and leadership across the industry chain, promotethe coordinated development of “government, hospitals, enterprises, research institutions, universities, users” in thebiopharmaceuticalindustryandstrengthenthedemonstratione?ect.
Case
“Walking Party Lecture” introduced to Joincare
Joincare's Party member activities
4.7 Integrity and Business Ethics
Joincare strictly abides by the Law of the PRC Against Unfair Competition, the Interim Provisions on Prohibition ofCommercial Bribery, the Criminal Law of the PRC and other relevant laws and regulations. We always stick to theconcept of integrity and self-discipline in our operation of businesses. The Audit Committee of the Board of Directorsplans and oversees the work related to business ethics and anti-corruption, and the Supervision and Audit Departmentis responsible for the implementation to ensure legal and compliant operation. We keep improving the integritymanagement system by strengthening audit and supervision over internal management and promoting integrity cultureto raise integrity awareness within the Group. In 2023, there were no violation cases of corruption, bribery, fraud, moneylaunderingandconictofinterestinJoincare.
4.7.1 Enhancing Anti-corruption Mechanism
The Group is well aware of the importance of integrity management, so we manage business ethics and anti-corruptionissues at the level of the Board of Directors. The Company has deliberated and approved the Anti-Corruption and Anti-Commercial Bribery System and the Anti-Fraud System at the 22nd session of the 8th Board of Directors’ Meeting andhas public disclosed the two systems. The policies define ethical standards to regulate the conduct of employees andpartners,therebypromotingthesounddevelopmentoftheGroup.Inaddition,specicrequirementshavebeensetupforcertain high-risk business segments, including the Financial Management System, the Outbound Investment ManagementSystem, to ensure legal and compliant operations. The systems mentioned above are applicable to all the employees ofJoincare (including but not limited to full-time and part-time employees, interns, contractors and etc).Werequireemployees,managementandpartnerstocomplywithbusinessethicsandclearlyimplementtheanti-corruption management responsibility. To prevent corruption risk, all employees receive training on the code of conductin relation to anti-corruption and anti-commercial bribery at the onboarding stage and sign the Commitment Letter ofAnti-commercial Bribery to clarify respective integrity responsibility and forbid violations. The management shall signthe Oath of Integrity for Senior Executives of the Company to ensure that they perform their duties with integrity andself-discipline. At the same time, we strictly regulate the process in business cooperation by developing the ManagementMeasures for Material Procurement of Joincare, the Implementation Rules for Procurement Bid Evaluation of Joincareand other regulations to ensure that the procurement process is fair and just. We have formulated the ImplementationRules for Bidding Management over Construction and Engineering Projects of Joincare for the procurement of projectsrelatedtoengineeringandequipment,rawmaterialsandexcipientstofurtherstrengthencontrolonbiddingprocess.When signing a contract with the Group, all suppliers shall sign the Anti-Commercial Bribery Agreement as an appendixto commit anti-corruption and anti-commercial bribery and promise not to violate business ethics during the performanceof the contract.
4.7.2 Internal Audit and Supervision
Joincare complies with the applicable laws and regulations, such as the Provisions of the National Audit Office onInternal Audit and the Guiding Opinions of the General Office of the State Council on Reforming and Perfecting theComprehensive Supervision System for the Medical and Health Industry, and formulates the Rules for Implementationof the Audit Committee, the Internal Control System, to regulate internal control work of the Group. We continuouslycarry out the audit of business ethics standards and anti-corruption policies on all operations of the Group. We setup the Supervision and Audit Department, which is independent of our business operations, to formulate the annualwork scheme for audit and supervision and carry out audit as scheduled. The employees of the Supervision and AuditDepartment are full-time employees who are not directly involved in our production and operational activities. The auditresults are reported directly to the Audit Committee of the Board of Directors. Through maintaining independence atthe organisational, operational and individual levels, we ensure that the audit results are independent, fair, objective andaccurate. Moreover, the Group's Supervision and Audit Department is responsible for reviewing and supervising theimplementation of policies such as the Anti-Corruption and Anti-Commercial Bribery System and the Anti-Fraud System,and assessing the effectiveness of business ethics management measures. In addition, we, on an annual basis, conductaudit on all subsidiaries, with the Annual Risk Management and Internal Control Report issued, and develop specialauditplans.Forissuesidentifiedintheaudit,wepromptlyproposerectificationadvice,requiretheauditedcompanytocompletetherecticationwithin120daysandverifytherecticationresults.In 2023, the Audit and Supervision Department conducted audit on all subsidiaries as planned. The scope of the auditscovered all businesses of the Group, including the management and implementation of internal controls over subsidiaries’business activities, particularly the management of engineering, financial and expense, human capital, procurement,inventory,quality,EHS,contractandotheraspects.Nomajordefectswerefoundin2023.
Corporate Social Responsibility Report 2023
4.7.3 Whistleblower Protection
Joincare keeps improving the reporting management system and whistleblower protection mechanism. We haveformulated and publicised the Measures for the Management of Reporting and Complaining, which standardise thereporting process and clarify that all the employees, customers and suppliers of the Group have the right to reportcorruption, bribery, fraud and other misconducts, thus fully protecting the reporting rights of employees and partners.Also, the Company has convened a meeting of the Audit Committee of the Board of Directors on 2 April 2024 todeliberate the Joincare Pharmaceutical Industry Group Co., Ltd. Complaining, Reporting and Whistleblower ProtectionPolicy,whichwasdisclosedontheo?cialwebsiteatthesametime.We have set up various reporting channels available on the Group's official website, including letter, telephone, email,etc.forchoice.TheGroup'sSupervisionandAuditDepartmentandAnti-fraudO?ceareresponsiblefortheacceptanceof reports, timely investigation and handling, and case summarising and reporting. The case shall be completed within 30daysfromthedateofacceptance,andtheresultshallbenotiedtothewhistleblower.In addition, we strictly keep confidential the information on whistleblowers and the content of reports and complaintsaccordingtotherequirementsoftherelevantpolicies.Weclassifythematerialsandrecordsofreportsasprivateand confidential, and keep them under the custody of designated personnel, thereby protecting whistleblowers fromthe disclosure of reports and fully safeguarding reporters' legitimate rights and interests. Employees who violateconfidentiality provisions, disclose whistleblowers' information or retaliate whistleblowers will be held legally liableuponverication.
Tel:0755-86252316 0755-26980226
Internal email: SAMD@joincare.comExternal email: joincaresamd@163.com
Address: Joincare Pharmaceutical Group Building No. 17-2 Langshan Road Nanshan District, Shenzhen
Joincare's Reporting and Complaint Channels
4.7.4 Fostering Integrity Culture
The Group adheres to the philosophy of legal, transparent and honest operation. Integrating integrity culture developmentintooperationriskprevention,wecontinuouslystressthesignicanceofabidingbydisciplinesandlawsanddevelopinga sense of integrity through integrity culture promotion and training for all employees. These efforts help foster acorporate culture of fairness and integrity.WesetouttherequirementsforbusinessethicsintheEmployeeManualtoregulatethebehaviourofallemployees.Wepromote the culture of business ethics in the induction training of all new employees to raise their integrity awareness. In2023, we provided all employees (including full-time, part-time and contractors) with online training on ethical standards,includingrequirementsoftheAnti-CorruptionandAnti-CommercialBriberySystemandtheAnti-FraudSystem,andrequirementsforintegrity.Thisaimstoraiseemployees'awarenessofanti-corruption,anti-commercialbriberyandanti-fraud to ensure the implementation of business ethics policies in the Group. Meanwhile, all directors, supervisors, andsenior management of the Group have participated in several trainings on the standardised operation of listed companies,including topics of compliance management, anti-commercial bribery, anti-monopoly, and risk management.
4.8 Information Security
Joincare continuously promotes the application of information technology. Our daily business process and operationmanagement are empowered by using information technology. We have been using various information systems tosupport our daily operation, such as the Customer Relationship Management (CRM) system and the System Applicationsand Products (SAP) system. This year, we introduced the office system Feishu to further improve the daily worke?ciencyoftheGroup.We stringently safeguard the steady operation of information systems to ensure information security of the Group andcustomer privacy. We have formulated a range of information security management policies that are implementedacross the Group, such as the Management System for the Security of Computer Information System, the ManagementRequirementsforIDCDataCentreOperationandMaintenance,theBackupSystemandtheProcessofReportingSuspicious Affairs of Information Security, to standardise information security management systems and processes.Additionally, we have established an information security management organisational structure in the Group. Under thestructure,theVicePresidentservesasthechiefleaderofinformationsecuritymanagement.Toensureadequateresponseto any sudden disaster events, we keep improving the Emergency Plan for Network Server Systems and the DisasterRecovery Plan for Information Systems, which clarify the response mechanism and processing procedures and measuresin case of emergency. In addition, we conduct relevant emergency drills on a regular basis to verify the feasibility andintegrityofemergencyplans.Thesee?ortsareaimedtoensureourinformationsecurityandbusinesscontinuity.In2023,we carried out all-in-one backup appliance test and data backup drill to verify the effectiveness of relevant emergencyplans.In daily operations and management, we actively protect the end computers against viruses by deploying the EndpointDetectionandResponse(EDR)system.Thenext-generationrewallisdeployedtoconductnetworkpenetrationtestingand in-depth inspection of system security and carry out security assessment and vulnerability scanning. A securitymechanismoftheIntrusionPreventionSystem(IPS)isalsoinplace,whichusesavarietyofdefensivetechniquestostopintrusion when identifying security threats in real-time, with intrusion detection as the core. In addition, we perform aregulardatabackupandregularlyinspecthardwareequipmenttoensuredatasecurity.Wekeepimprovinginformationsecuritymanagementcapability.Specically,theGroupengagesindependentthird-partyagencies to annually audit information systems and information security policies and identify relevant risks. Furthermore,we make improvements based on the audit results to constantly perfect our information security risk management system.Over the past three years, the Group has not experienced any information security incidents.Inaddition,wepayahighemphasisoninformationsecuritytraining.Allouremployeesarerequiredtoparticipateinthe training on information security and privacy protection. The training is carried out online, covering topics such asthedenitionofinformationsecurityrisks,introductiontopreventivemeasures,identicationandtreatmentofphishingemail and privacy information protection, aiming to strengthen all employees' awareness of information security andcapability of risk prevention. By the end of the reporting period, all employees of the Group have completed trainingsessions on data security and privacy protection.
Corporate Social Responsibility Report 2023
Productqualityisacornerstoneforthelong-termsustainabledevelopmentofJoincare.Weconstantlyimprovetheproductlifecyclequalitymanagementsystems,strengthenoursupplychainqualitymanagementcapabilities,andimplementtheconceptofresponsiblemarketing,toprovidecustomerswithreliableandhigh-qualitypharmaceuticalproducts,therebysafeguardingpublic health.Tocontinuouslyimprovethequalitymanagementsystemandoperationmechanismtoenhancethequalitycontrolperformance,wehavesettheoverallqualitygoals,andconsistentlytomonitortheprogresstowardsthesegoalsonanannualbasis.Thegoalsinclude:
Safeguarding
Product Quality
SDGs in this section
Market sampling pass rate reaches
%
Customer complaint rate is less than1%
Customer satisfaction rate is greater than90%
5.1 Quality Management System
Adhering to the basic principles of "risk management, whole-process control, and social co-governance”, Joincare keepsupgradingandrefiningthelifecyclequalitymanagementsystemcoveringmedicineR&D,production,salesandusage.The Group undertakes the responsibilities of marketing authorisation holders (“Holder” or “MAH”) and continuouslyconsolidatesthegroup-wideproductqualitymanagementfoundation,toprovidepatientswithsafeandeffectivemedicines.In2023,theGroupanditssubsidiariesreviewedandoptimisedthequalitymanagementsystemforR&D,production,sales and use. In this regard, a number of documents have been newly formulated, including the Drug Safety SignalDetection and Management Process, the Control and Management of Medical Device Quality Agreements, theControl and Management of Entrusted Production of Medical Devices, and the Collection and Management of QualityTracking Information and User Feedback. These documents cover various businesses of the Group, such as chemicalpharmaceuticals,TCM,biologics,chemicalAPIsandintermediates,diagnosticreagentsandequipment,healthcareproductsandmedicaldevices,toensurethereliablequalityofallourproducts.Wealsorevisedandrefinedtheexistingmanagement documents. We made them easier to read and implement by simplifying the explanation of some operatingproceduresandaddingowchartstoproceduredescriptions.Wetakeproactivemeasurestomeetregulatoryrequirementsonproductquality.Wereporttheproductionandsales,post-marketing research, changes, risk management and other information of drugs to the medical products regulators everyyearinaccordancewithourannualreportingpolicy,toensurethatourqualitysystemcomplieswithlawsandregulations.Inthefuture,Joincarewillcontinuouslyexploreeffectivewaystomanagequalitywhileensuringcompliancewithexternalregulationstoprovidepatientswithsafe,reliableandqualityproducts.
5.1.1 Quality Management System in R&D
TheGroupismakingcontinuouseffortstobuildarobustR&DqualitymanagementsystemandconsolidateitsproductR&Dmanagementcapabilities.InlinewiththerequirementsofISO9001,ICHQ10andtheGoodManufacturingPractice (“GMP”), we keep optimising various processes of product R&D and daily records management. Each R&DunitisrequiredtodesignatespecialR&Dqualityassurance(“QA”)personneltosupervisethecompliancefromprojectinitiations, R&D management, project operation, and technology transfer to routine inspection, thus improving the R&Dqualitymanagement.In2023,weimprovedourR&Dqualitymanagementsysteminaccordancewithdomesticandoverseaslawsandregulations and based on our own R&D management characteristics. We have also formulated management documentssuch as the General Rules for Sample Testing and Data Processing and the Procedure for Electronic Data Management.Thanks to those efforts, our R&D processes such as file management, lab management, instrument and devicemanagement, materials and reagent management, as well as preparation research have been optimised. In addition,the Group continues to strengthen the ability in on-site supervision and management of R&D activities. The on-siteinspections cover sample preparation, materials management, auxiliary books, procedure execution, etc. We conductinternalauditsontheeffectivenessoftheR&Dqualitysystem,toidentifydeficienciesintheR&Dqualitymanagementprocessandmaketargetedrectifications,andimproveourR&Dqualitymanagementcapabilities.Wealsoregularlyreview the original records, test reports, electronic forms, and other data. Any abnormal R&D data discovered is promptlyinvestigatedandcorrected,andtherequirementsforriskandqualitymanagementandcontrolofR&Dprocessesarestrictly implemented.Intermsofclinicaltrials,theGrouphassetuptheDepartmentofClinicalResearchtostrengthenqualitymanagementin stages of design, preparation, implementation, etc, in clinic trial. The goal is to ensure that investigational medicinalproducts(IMP),biologicalsamplemanagement,clinicaloperations,clinicalqualitycontrolandotherqualitymanagement related aspects are legal, compliant, safe and reliable.
Corporate Social Responsibility Report 2023
5.1.2 Quality Management in Production
TheGroupstrictlyabidesbynationallawsandregulationsandhasestablishedtheproductionqualitymanagementsystem of Joincare in accordance with the Drug Administration Law of the PRC, the Provisions for the Supervision andAdministrationofDrugManufacturing,andtheGoodManufacturingPractice.In2023,werenedourproductionqualitymanagement system in accordance with the latest national regulations by adding the Procedure for Routine Supervisionand Administration of Entrusted Drug Production, the Management Procedure for Entrusted Inspection, and the DutyPerformanceManagementProcedureforQualifiedPersons.Detailedrulesonproductionqualitymanagementwereimproved,andthequalitysupervisionandmanagementoftheproductionsubsidiarieswasstrengthened.Intermsofmedicaldevices,wecontinuetooptimisethequalitymanagementsystem,includinglabmanagement,electronicdatamanagement,inspectionmanagement,equipmentandfacilitymanagementandothertestmodulesbasedontheoriginalsystem,toenhanceourabilitytocontrolthequalityoftheseproducts.Inaddition,weconstantlyimprovetheproductionqualitymanagementsystemtomeetinternationalstandardsandurgedsubsidiariestoobtaininternationalcerticationstoreinforceproductqualitymanagementcapabilitiesanddelivercompetitivepharmaceuticalproductstoglobalmarkets.
Design·The Department of Clinical Research participates in the discussion and review of key documentsof the clinical trial project, to ensure that the trial is scientific, reasonable and feasible from theperspective of design.Preparation·The Department of Clinical Research develops the clinical monitoring plan, the projectmanagementplanandthequalitycontrolplanandmakestheprojectauditplanatthegrouplevel.Thisistoensurethattheclinicalmonitoringteteam,projectmanagementteam,qualitycontrol,teamandgroupauditteamsperformtheirqualitymanagementfunctionseffectivelyandtosafeguardthequalityofclinicaltrials.
Implementation·TheDepartmentofClinicalResearchoverseestherelevantqualitymanagementactivities.Itis responsible for ensuring that clinical trial data is truthful, accurate and reliable, and that themaintenance of clinical trial documents, trial procedures, IMPs, biological samples, and othertrialinformationareallcompliantwiththerelevantrequirementsofthequalitymanagementspecicationfortheclinicaltrialsofmedicalproductsandthequalitymanagementsystem.
RegistrationandCerticationBy the end of the reporting period, the overall registration and certification of Joincare’s APIs, formulations, anddiagnostic reagents are shown as follows:
By the end of the reporting period, all the production lines and related products of the Group and its subsidiaries had complied withtheGMPregulations.Joincareanditsmultipleproductionsubsidiarieshadpassedthequalitymanagementsystemcertication. Table: GMP compliance of production lines of Joincare
ProjectJoincare’sGMPCerticationsbytheEndoftheReportingPeriodGMPCertication
APIs79 production lines of 7 API producers complied with GMP regulationsPreparations63production lines of 9 preparation producers complied with GMP regulationsIn Vitro DiagnosticReagents
2 production lines of 1 in vitro diagnostic reagent producers complied withGMP regulationsTable:CerticationofthequalitymanagementsystemofJoincare
Company NameCerticationJoincareGB/T19001-2016/ISO 9001:2015; ISO/IEC 17025:2017/CNAS-CL01Taitai PharmaceuticalGB/T19001-2016/ISO 9001:2015Joincare HaibinGB/T19001-2016/ISO 9001:2015Jiaozuo JoincareGB/T19001-2016/ISO 9001:2015Fuzhou FuxingGB/T19001-2016/ISO 9001:2015Ningxia PharmaceuticalGB/T19001-2016/ISO 9001:2015; ISO 22000:2018Livzon DiagnosticsGB/T42061-2022/ISO 13485:2016Shanghai FrontierGB/T19001-2016/ISO 9001:2015; ISO/IEC 17025:2017/CNAS-CL01Guangzhou JoincareGB/T19001-2016/ISO 9001:2015; ISO/IEC 17025:2017/CNAS-CL01
Table:GlobalcerticationofJoincare
ProjectJoincare’sInternationalCerticationbytheEndoftheReportingPeriod
InternationalCertication
APIs
·?18varietiesobtainedinternationalcerticationsforon-siteinspections.·?35 international certifications within the validity period were obtained (including 5certicationsforFDAon-siteinspectionsand14CEPcertications).Formulations
·?7varietiesobtainedinternationalcertications.·?18internationalcerticationswithinthevalidityperiodwereobtained.In VitroDiagnosticReagents
·?10varietiesobtainedinternationalcertications.?·?5internationalcerticationswithinthevalidityperiodwereobtained.
Corporate Social Responsibility Report 2023Product Testing CapacityAllourproductionsubsidiarieshavebeenequippedwithlabsforthetestingofdrugs.High-precisiondevicessuchashigh-performanceliquidchromatograph,gaschromatograph,particlesizeanalyser,disintegrationanalysersandmulti-functional automated microbiology analysers enable production subsidiaries to conduct many test projects independently.ThiscanmeettheirneedsforquicktestingandtheR&Dandtestingofinnovativeproducts,ensuringproductqualityinacomprehensive manner. Meanwhile, our Analysis and Testing Centre conducts in-house testing on innovative medicinesand high-end complex preparations, as well as research and tests on the compatibility of packaging materials, ensuringthattheproductsmeetthequalitymanagementrequirements.In2023,theAnalysisandTestingCentreoftheGroupand the testing centres of Shanghai Frontier and Guangzhou Joincare passed the lab certification of China NationalAccreditation Service for Conformity Assessment (CNAS). This means that the testing centres of the Group and itssubsidiaries are fully capable of performing testing in accordance with ISO/IEC 17025.In addition, we have been actively engaged in precautionary tests and the detailed investigation of possible impurities inproduct formulations and production processes. We identify potential product issue from the perspective of safety andqualityandpromptlyoptimiseformulations,processes,packaging,storageandotherproductionsteps,soastocontrolpotentialproductrisksattheirorigin.Furthermore,wepaysustainedattentiontothelatestrequirementsforproductqualityintheindustryandstakeholders’expectations,andengagequalifiedthirdpartiestoperformqualitytestswhennecessary.
Short-term deviations from the specified storage conditions during transport may affect productquality.Toassessthepotentialimpactofshort-termdeviationsfromthespecifiedtemperatureonour products, we carry out repeated simulated precautionary tests on various types of product. InDecember 2023, we placed temperature probes in the vehicles destined for Shenyang to record thelowest and highest temperatures during transport. Considering the actual transportation conditionsandtheproductquality,wedesignedworsetestingconditionsandlongerstorageperiods.Forexample, Levosalbutamol Hydrochloride Nebuliser Solution should be protected from light, storedbelow 25°C, and should not be frozen. In the simulated test, we assessed the stability of the solutionstored at temperatures ranging from -20°C to -10°C for 10 days and at 40°C for one month. Basedonthechangesinthetestdata,wepredictedpotentialproductqualityrisksand,accordingly,gaveinstructionstotransportserviceproviders.Thisensuresthatproductqualityisn’tcompromisedduringtransportandhelpstocontrolproductqualityandsafetyrisksatthesource.
Haibin Pharma set production standards for the aseptic API process and the aseptic preparationfillingprocessinaccordancewithGMPrequirements,andcarriedoutsimulatedtestsoftheasepticproduction line through medium filling against the standards. It aimed to further specify and updatethestandardsforthequalifiedconditionsofasepticproductionandtoprovidetechnicalsupportforqualitycontrolintheproductionstageandfortestinginlaterstages.Duringthesimulation,wetestedthe maximum number of people involved in the aseptic production, the maximum storage time forequipmentandmaterialsaftersterilisationordisinfection,themaximumprocessretentiontime,andthe maximum duration of open operation of sterile products. In this way, we successfully ensured theaseptic operation standards for product manufacturing.
Simulated precautionary test under transport scenarios
Simulation validation of the aseptic API process and the aseptic preparation fillingprocess of Haibin Pharma
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Regulatory InspectionsJoincarecooperateswithregulatoryinspectionsandtakespromptactiontocorrectanyqualitymanagementissuesidentified,soastofurtherimproveitsqualitymanagementsystemandmanagementperformance.In2023,wereceived118inspectionsfromregulators,andtheinspectionresultsallmettherequirements,withoutanysignificantorseriousdecienciesidentied.
To meet national standards and customer needs, Jiaozuo Joincare focuses on building up its producttestingcapabilities.Ithassetqualitystandardsandtestoperationspecificationsforallproductsandisequippedwithhigh-precisionequipmentsuchashigh-performanceliquidchromatograph,gas chromatograph, particle size analyser, protein analyser, and specific surface area analyser.Currently,JiaozuoJoincareisabletotestthequalityof7-aminocephalosporanicacid(7-ACA),deacetyl-7-aminocephalosporanic acid (D-7ACA), demeclocycline hydrochloride (DH), and4-Acetoxyazetidinone (4AA). Jiaozuo Joincare has developed specific test operation specificationsandconductstestcontrol,toaddressqualityissuesofparticularconcerntocustomers,suchasresiduesofbacterialendotoxin,proteinandα-aminoadipicacidin7-ACA.ThishelpsJiaozuoJoincarefullyimprove its product testing capabilities. In 2023, Jiaozuo Joincare tested over 3,000 batches of 7-ACA,over 800 batches of D-7ACA, over 400 batches of DH, and over 700 batches of 4AA, as well as over8,600 batches of raw materials used in the products.
JiaozuoJoincareimprovesitsproductqualitytestingability
5.1.3 Quality Management in Operation
In strict compliance with the Good Supply Practice (“GSP”), Joincare has newly formulated multiple managementpolicies,includingtheDrugTraceabilityManagementPolicy,theOperatingProceduresfortheUseofEquipmentandFacilities,andtheOperatingProceduresfortheVerificationofEquipmentandFacilities.Wehavealsoupdatedtheexistingpolicies,soastobettercontrolproductqualityintheprocurement,storage,distributionandtransportofdrugs.Wehavebuiltthedrugproducttraceabilitysysteminaccordancewiththenationalregulatoryrequirements,refinedandupdatedtheDrugTraceabilityManagementPolicy,fulfilledtheresponsibilitiesforqualitycontrolthroughoutproductlifecycle,andfurtherclariedtheresponsibilitiesofourdepartmentsinproducttraceability.WehavealsodevelopedtheManagement Procedures for Electronic Drug Traceability Codes, to ensure that all drugs can be traced on our "On-code"drug traceability information system. Through digital means, we ensure that “each drug has a code, and both the drug andits code can be traced” and present the traceability data of drugs throughout the process in real time.In 2023, we made sustained efforts to optimise the drug traceability management process, to ensure that all documentsrelated to drug storage and delivery were uploaded to the drug traceability information system. We tracked the documentsof key drugs and urged level-1 distributors to promptly scan the traceability codes and upload the documents, so that thedrugowinformationcouldbeenteredintothesystemwithoutdelay.Management of Package Inserts and LabelsThemanagementofpackageinsertsandlabelsarethefocusofourproductqualitymanagement.Inaccordancewithrelated regulations and laws, the Group strictly controls the design, use and change of product package inserts andlabels in accordance with the Marketed Chemicals and Biologics Clinical Changes Technical Guidelines, the ChangeManagement Regulations and other internal management regulations.
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Corporate Social Responsibility Report 2023In 2023, the Group continued to strengthen the internal risk management on package inserts and labels, and standardisedthe process for any change. We updated and optimised the Provisions for Medicine Insert Sheets and Labels. In theprovisions, we summarised issues identified during the review and approval of changes to package inserts and detailedthemanagementrequirementsforthesechanges,furtherimprovingthemanagementofpackageinsertsandlabels.Wedemand that changes to package inserts and labels be initiated and designed by the holder. The design should be strictlyreviewedandapprovedbytheholder’ssales,production,qualitycontrolandotherrelateddepartmentsandchangestoinformation on the safety and efficacy of medicines should ultimately be approved by the National Medical ProductsAdministration, so as to maintain the rationality and accuracy of drug information to the greatest extent possible.Weclassifychangesaccordingtotheirimpactonandrisktodrugsafety,e?cacyandclinicaluse.Intheeventofchangesto drug safety information or pharmacovigilance plans, our Pharmacovigilance Department will strictly manage thechanges in accordance with the Procedures for Changes to Information Related to Safety in Package Inserts. Relevantdata about drug safety will be collected, reviewed and evaluated by the Pharmacovigilance Department, and thensubmitted to the Drug Safety Committee for review and confirmation, thus supporting patients’ access to accurate,reliableandscienticdruginformation.
In 2023, the Drug Safety Committee convened two meetings. At the meetings, the potential safetyissues in our existing products were analysed and summarised, the adverse event information collectedwas discussed, and it was proposed to strengthen our risk management ability for the key productTobramycin, conduct continuous monitoring, and ramp up patient education. Meanwhile, we held thefirst meeting of the Leading Group of Medical Device Adverse Event Monitoring, introducing theworking mechanism and responsibilities of the group. This meeting laid the foundation for the medicaldevice vigilance work in the future.
Meeting of the Drug Safety Committee
To manage adverse drug reactions, in addition to timely collecting and processing the feedback of adverse events fromthe National Center for ADR Monitoring, China, the Group has added the QR code for information collection on theouter packaging and in the insert sheets of products to provide a convenient channel for customers’ feedback, whichcovers 100% of all products held by the Group. In addition, we actively seek feedback on adverse reactions from usersthrough our 400 hotline, official website pharmacovigilance email and extension, sales feedback and post-marketresearch. We regularly collect information on adverse reactions to similar products through relevant professional websitesor literature searches. By doing so, we ensure that adverse reactions are comprehensively collected through multiplechannels and reported to regulatory authorities in accordance with laws and regulations. Besides, we categorise, analyseand monitor the collected adverse events, regularly assess the risks of product safety and implement control measures toensure the safety of medication for the public.
5.1.4 Pharmacovigilance
JoincarestrictlyfollowstherequirementsoftheGoodPharmacovigilancePractices(“GVP”)andhasfurtherrefinedits documents on pharmacovigilance. With reference to the Guiding Principles for Pharmacovigilance Inspection, wehavestandardisedthepharmacovigilancepractices.Bydoingso,weensurecompliancewiththerequirementsofGVP,and fulfil our responsibilities for pharmacovigilance. In 2023, we established the medical device vigilance system andadded documents including the Procedures for Handling Individual Safety Reports in Medical Device Clinical Trials,the Procedures for Monitoring and Reporting Adverse Events in Medical Device Clinical Trials, and the Procedures forHandling Defects in Medical Device Clinical Trials. The system and documents, which cover the safety managementof medical devices before and after they are placed on the market, help strengthen our ability to manage risks in themedical device business. In addition, the Group adopts a new digital drug safety management system. Its robust usermanagement and permission control mechanism ensures the security of pharmacovigilance data. Its data statistics andanalysisfunctionprovidesastrongdatasupportforpharmacovigilanceandcomprehensivelyimprovesthee?ectivenessand standardisation of the Group’s pharmacovigilance practices.
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5.2 Quality Risk Control
Tofullyensureproductquality,JoincarehasestablishedandcontinuestorefinetheRegulationsonQualityRiskManagementandtheManagementRegulationsonRiskManagementPlanwithreferencetotherequirementsofrelevantlawsandregulations.Theaimistostandardisetheprocessesofidentication,analysis,evaluation,controlandreviewofqualityrisks,improveproductdesign,ande?ectivelymanageandcontrolproductqualityrisks.
5.2.1 Quality Risk Management
TheGroupmakescontinuouse?ortstoenhanceitsriskmanagementsystemcoveringR&D,productionandoperation,tomanagequalityrisksthroughouttheproductlifecycle,buildupitsqualityriskmanagementcapabilities,anddeliverhigh-qualityproducts.
Product RecallWe have developed and continusly updated the Drug Recall Management Procedures to guide the recall of productsincaseofqualityissuesorothersafetyhazardsareidentified.WeclassifydrugrecallsintoLevel-I,-II,and-IIIrecallsaccording to the severity of safety hazards. We also have corresponding recall procedures in place toensure patient safetyin medication. Over the past four years, there were no recall incidents due to our sold or shipped products for safety orhealth reasons. The total number of product recalls was 0.
Quality Risk Management System of Joincare
Joincare has developedpolicies including the RiskManagement and the DataIntegrity Assessment pursuantto the Good ManufacturingPractice (GMP). In prospectiveand retrospective manners, weidentify risks in man's work,machines, materials, rules,links, and tests with FMEA,HACCP, preliminary hazardanalysis, and other tools.Further,weconductclassiedrisk management and takecorresponding measures tomitigate or eliminate the risks.
For post-marketingmanagement, Joincarepromptlyhandlesqualitycomplaints and adversereaction feedback from usersaccording to the ManagementProcedures for AdverseMedicine Reaction, theManagement Proceduresfor Customer Complaints,the Procedures for HandlingIndividual Safety Reports ofPost-marketing Drugs, andthe Procedures for WritingPeriodic Drug Analysis andEvaluation Reports. Besides,we organise and conduct post-marketing drug research, andcollect full lifecycle drug data.E?ortsarealsomadetoassessrisks, determine managementmeasuresforrisksidentied,and continuously monitorpotential risks.
R&DProductionOperationOn the premise of complyingwith relevant laws andregulations, Joincare ensuresitsR&DqualitybyfollowingICH guidelines such as thepharmaceuticalqualitysystemICH Q10 and adopting theQualityTargetProductProle(QTPP), the Failure Mode andE?ectsAnalysis(FMEA),theHazard Analysis and CriticalControl Points (HACCP), andother risk management toolsto determine products' criticalqualityattributes(CQAs)andcritical process parameters(CPPs).
Corporate Social Responsibility Report 2023
In January 2023, Joincare initiated a Level-I recall simulation for Budesonide Suspension forInhalation and Ipratropium Bromide Solution for Inhalation. During the drill, our Quality ManagementDepartment tracked the key phases: The recall notice was sent to the production subsidiary andthe functional department; the warehouse submitted the sales and delivery records of the recalledproducts; the production subsidiary reported the suspension of production and release; the recalledproducts were stored in isolation; and the marketing department reported the suspension of sales anduse. All the simulated recall procedures were completed within the specified time, demonstrating thetraceabilityofourproductsandthee?ectivenessofourrecallsystem.
Product recall simulation
In addition, to strengthen our ability to respond to drug safety emergencies, the Group carried out a drug safetyemergency drill in August 2023 to simulate real-life scenarios of major drug safety incidents (level II). In the drill, wetook response measures following the emergency plan and reviewed the handling process after the drill, to improve ourability to ensure drug safety and handle drug safety incidents, and to best prevent and limit drug safety incidents.
5.2.2 Quality Audit
Inordertocontinuouslyimprovethequalitymanagementsystem,theGrouphasmadeperiodicqualityauditplanscovering all the producers, operators, and R&D institutions. Special audits are conducted following major changes suchastheenactmentoflawlawsandregulations,managementdemandsandexternalregulatorychanges.Weperformqualityaudits at least twice a year on our production subsidiaries with reference to GMP regulations and the On-site AuditManagementProcedures.Thesesubsidiariesalsoconductself-auditsandinspectionstoidentifyrisksanddecienciesinthedailyoperationofthequalitymanagementsystem,andmakeanalysisandrectificationaccordinglytoimprovetheirqualitymanagementcapabilities.In2023,theGroupanditssubsidiariesorganisedanauditteamtoconduct10qualityauditsontheproductionsystem,packagingsystem,materialsystem,equipmentandfacilitysystem,qualityassurancesystem,qualitycontrolsystem,environmental protection and occupational health and safety of the subsidiaries and entrusted production enterprises.We also urged them to rectify the deficiencies identified in the audits. Meanwhile, Joincare and each of its subsidiariesactivelycooperatedwiththequalityauditsbydomesticandoverseasregulatorsandcustomers,andanalysedandpromptlyrectiedthedecienciesidentiedbyexternalexpertstoenhancequalitymanagementcontinuously.
5.2.3 Responsible Product Design
Tobetterimplementtheconceptofsocialresponsibility,Joincaretakesproductquality,safety,health,environmentalprotection and other elements involved in the product lifecycle into account when developing new products. On thepremise of meeting customer needs and providing premium products, we make every effort to minimise the negativeimpact that our products may have on the environment and society in the whole product life cycle, including R&D,production, transportation, sale, use and disposal.
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Product recall simulation is exercised every two years at Joincare to ensure the drug recall process is effective. We alsoimplement a product risk management scheme to ensure that the risk management of post-marketing products is in linewithrelatedpharmacovigilancelawsandthattheproducts’qualityalwaysservestheirintendedpurposesandsatisestheregistrationrequirements.
Development and designWe analyse and identify potential social and environmental risks that may arise throughout the lifecycle of our productsand seek to manage them at the source where possible. For example, we have recognised that choosing the wrong rawmaterials or ingredients for product development may cause serious damage to the environment. With this in mind,we have stepped up our efforts to monitor and study environmental impact factors of raw materials. We have set up adepartment to assess the potential environmental impact and other negative impacts of the raw materials used in ourproducts, and to promote the use of non-hazardous materials or minimise the use of hazardous materials.ManufacturingWe have developed management policies such as the Control and Management of Environmental Factor Identificationand Evaluation. In accordance with these policies, we monitor energy and water consumption, emissions, waste dischargeand other environmental impacts during product manufacture. We assess the materiality of environmental factors in termsofproducingfrequency,toxicity,degreeofmitigation,controlmeasuresandimpactonstakeholders,andadjustproductdesign or take relevant control measures based on the assessment results, so as to reduce the negative impact of ourproducts on the environment during their manufacture.Transport and distributionFocusing on the harm that hazardous chemicals may cause to human health and the environment, we sort out, identifyand classify all chemicals involved in the transport and distribution of our products to reduce the use of hazardouschemicals wherever possible. We also implement strict rules for the storage, transport and use of necessary chemicals tominimise the harm caused by hazardous chemicals during their lifecycle.
Product use
We analyse the environmental and social impacts of products during their use following the principle of product lifecyclemanagement, to ensure that product design and materials selection do not violate environmental and social laws andregulations.
Recycling and disposal
We identify the elements of our products that may have negative impacts on the environment during product recycling,disposalanddegradationfollowingtheControlandManagementofEnvironmentalFactorIdenticationandEvaluation.On this basis, we seek to reduce the use of such elements in product design and develop standardised processingprocedures for irreplaceable elements, to guide relevant parties on how to process them properly and minimise negativeenvironmental impacts.
5.3 Quality Training for Employees
Joincareisactiveinraisingemployees’qualityawarenessthroughtrainingandeducationprogrammesonproductquality.WehaveestablishedthetrainingschemetomanageemployeequalitytraininginaccordancewithGMP,GSP,GVP,CNASandotherspecifications.Allemployeesarecoveredbyourqualitytraining,includingtheannual,monthlyandweeklyqualitytrainingandhands-ontraining.Weimproveemployees’productqualitymanagementskillsandinstilthequalityawarenessineachemployeebyarrangingshorttrainingsessions,funsportsmeetings,onlineknowledgecontests,operationskillcompetitionsandthelike.Theaimistofosteracorporatecultureof“qualityrstinpursuitofexcellence”.In2023,Joincareconductedmorethan660trainingsessionsonproductqualityandsafety,withanemployeecoveragerate of 100% and 39.6 hours of training per person.
Corporate Social Responsibility Report 2023Joincare and its subsidiaries carry out “Quality Month” events for all employees on an annual basis. Every month,weprovideprofessionalandcustomisedtrainingcoursesforallpersonnelrelatedtoqualitysystems,coveringqualitycontrol, as well as R&D, production, sales and pharmacovigilance management. In this way, we keep relevant personnelwellinformedofthechangesinapplicablelawsandregulationsandqualitystandardsandimprovetheirprofessionalskills and competencies.Toenhanceemployeeawarenessofproductquality,weshareknowledgeonqualitylaw/regulationwithemployeeseveryday,tohelpthemgainlegalknowledgeaboutqualityintheirdailywork.
Examples of Daily Posts of Knowledge on Quality Law/Regulation
In addition, following the principleof practicality and necessity,the Group issued the JoincareCompilation of Quality Lawsand Regulations based on 20common regulations and guidelinesselected from MAH, GCP, GMP,GSP, GVP and other regulations.This compilation serves as adaily reference tool provided toall employees, supporting andencouraging them to consult itpromptly.
Joincare Compilation of Quality Laws and Regulations
In 2023, the Group carried out the annual "Quality Month" activity for all employees as usual, with theaimofreinforcingemployees’awarenessof“focusingonqualityandcompliance”andconsolidatingthefoundationofqualityculture.Tothisend,YuXiong,theGroup’sBoarddirectorandCEO,supervisedandorganisedtheheadquartersand7subsidiaries,TaitaiPharmaceutical,JoincareHaibin,Haibin Pharma, Xinxiang Haibin, Jiaozuo Joincare, Shanghai Frontier, and Guangzhou Joincare, tojointlycarryout“QualityMonth”events,includingqualityknowledgetraining,qualityknowledgecontests, and fun activities. During the “Quality Month”, we organised 8 centralised training sessionsonasepticproduction,qualitystandards,productverificationandvalidation,developmentsiteverification,ISOqualitymanagementsystemrequirements,etc.Thetrainingwasattendedbyallouremployees.Throughtheseevents,weincreasedemployees’senseofresponsibilitythatqualitymanagement is essential in all business areas, throughout the process and at all times. This hashelpedtocreateaworkingatmosphereinwhichallemployeesareconstantlyinvolvedinqualitymanagement.
Tobetterfosteracorporatecultureofqualityandenhancethequalitymanagementperformancefollowing the Group’s strategy, Jiaozuo Joincare, led by its CEO Xing Zhiwei, launched the “EveryoneParticipates in Quality Improvement” event during the “Quality Month” in 2023. A series of activitiessuchasthequalitytraining,qualityknowledgecompetition,funquiz,operationskillscompetitionandessaycompetitionwereheld.WealsofocusedonqualitytrainingforR&Dsta?.Atotalof22trainingsessionsweredeliveredtoimprovetheirqualitymanagementskills.
The 2023 “Quality Month” of Joincare
The “Everyone Participates in Quality Improvement” event of Jiaozuo Joincareduring the “Quality Month”
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“Quality Month” Events Series of Joincare in 2023
The “Everyone Participates in Quality Improvement” Event of Jiaozuo Joincare during the “Quality Month” in 2023
Corporate Social Responsibility Report 2023
5.4 Intellectual Property Rights Protection
The Group is committed to product diversification, multi-level innovation and development, and improving themanagement system for intellectual property protection. Joincare strictly abides by laws and regulations such asthe Patent Law of the PRC, the Guidelines for Patent Examination, and the Measures for the Implementation ofEarly Resolution Mechanisms for Drug Patent Disputes (for Trial Implementation). Joincare has formulated internalmanagement documents such as the Policy on Emergency Plan for Intellectual Property and the Policy on IntellectualProperty Education and Training to clarify the Group’s emergency plan for patent infringement and the departmentresponsiblefortrainingmethodofintellectualproperty.Allthesee?ortsaimtoimprovethemanagementandoperationofintellectual property, raise employees’ awareness of intellectual property protection, and fully respect others’ research andinnovationachievements,soastobuildabusinessecosystemfeaturingmutualbenet,mutualtrust,innovation,andwin-win results.Joincare protects its intellectual property rights mainly by registering patents, trademarks and copyrights and technicalsecrets. Ongoing efforts are made to consolidate the intellectual property protection network for respiratory medicinesand support the Group’s strategic presence in the healthcare industry. As of the end of the reporting period, for well-known respiratory formulatioin products such as Tobramycin Inhalation Solution (健可妥?), Budesonide Suspension forInhalation (雾舒?), Levosalbutamol Hydrochloride Nebuliser Solution (丽舒同?), Compound Ipratropium BromideSolution for Inhalation (舒坦琳?), and Ipratropium Bromide Solution for Inhalation (丽雾安?), the Group has appliedfor 122 related patents, including 66 invention patents, 45 utility model patents, 9 appearance design patents and 2PCT applications. Meanwhile, 88 patents were granted, including 40 invention patents, 39 utility model patents and 9appearance design patents.
JoincareHaibinfocusesonreservingandtrainingproductionqualitymanagementtalentstomeettheGroup’s talent needs in rapid development. In 2023, Joincare Haibin opened its first “Elite TrainingCamp for Aseptic Drug Production Quality Control”. The training contains technical principle learningandhands-ontraining.Thetrainingcontentcoveredpersonnelmanagement,equipmentrepair,cleaninganddisinfection,collinearproduction,qualitycontrol,processsimulation,andequipmentverification. The training camp was launched to impart knowledge on aseptic drug production to thesta?andimprovetheirskillsinmanagingthequalityofasepticdrugproduction.
JoincareHaibin’srst“EliteTrainingCampforAsepticDrugProductionQualityControl”.
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Joincare Haibin’s First “Elite Training Camp for Aseptic Drug Production Quality Control”
Table: Joincare’s intellectual properties and patents by the end of the reporting period
Valid Patents FiledNumberofvalidpatentsled749Number of invention patents434NumberofInternationalpatentsled138
Valid Patents Granted by the End of the Reporting PeriodNumber of valid patents granted1,008Number of invention patents521Table: Joincare’s registered trademarks by the end of the reporting period
Trademark RegistrationNumber of registered trademarks1,874Number of domestic trademarks1,645Number of overseas trademarks229At the same time, we make training plans every year to train employees on intellectual property knowledge and skillsat various levels and stages. This program aims to provide general knowledge and professional skills training relatedto intellectual property protection. Through methods such as case studies, interpretation of standards, and practicalapplication exercises, we strengthen employees' awareness and professional capabilities in intellectual propertyprotection.
In March 2023, the Group launched training on “Patent Term” for R&D staff to introduceChineseandUSpatenttermrequirementsandtheirdifferences.GiventheneedsofR&Dstaffat work, detailed information on “Patent Term Extension” and “Drug Patent Term ExtensionPolicy”, which were added in the fourth revision of the Patent Law of the PRC, was alsoshared to help them improve their knowledge of and skills in patent protection and practice thephilosophy of intellectual property protection.
Training on patent term
The Group continues to promote intellectual property protection and improve intellectual property protectionmechanisms,therebystronglysupportingtheapplicationofourR&Dachievements.In2023,ourscienticande?ectiveintellectual property management system and policy passed the certification under the Enterprise Intellectual PropertyManagement. They are a strong guarantee of our product innovation and R&D. We also passed the review of the NationalIntellectual Property Demonstration Enterprise in 2023, demonstrating that regulatory authorities recognise our work inintellectual property management. In the days ahead, we will continue to strengthen intellectual property protection withnew technologies, play a demonstration role in intellectual property management, and implement the Group’s strategy ofinnovation-driven sustainable development, to contribute to the building of a powerful country in intellectual property.
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Corporate Social Responsibility Report 2023
Moreover, Joincare tends to develop overseas markets with an open and inclusive attitude. In the future, when promotingour drugs and reagents on overseas markets, we will implement as far as possible the Doha Declaration on the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement and Public Health. Where third parties invite us toprovide our products for the least developed and low-income countries, we will license our product patents on appropriateterms and conditions.
CerticateofIntellectualPropertyManagementSystem
5.5 Protection of Customer Rights and Interests
Joincare attaches great importance to protecting the rights and interests of customers. Adhering to the concept ofresponsiblemarketing,wedelivertruthfulande?ectivedruginformationtocustomers.Wefullyrespectandunderstandusers’needstoenhancecustomersatisfactionandimprovetheGroup’sservicequalityinmultipledimensions.
5.5.1 Responsible Marketing
Joincare strictly abides by the Advertising Law of the PRC, the Against Unfair Competition Law of the PC, the PersonalInformation Protection Law of the PRC, the Measures for Examination and Administration of Advertisements of Drugs,Medical Devices, Healthcare Products and Formula Foods for Special Medical Purposes, and the relevant laws andregulations of the places where the Group operates. We commit to provide accurate and truthful product informationin the process of publicity and marketing. We have formulated and disclosed the Responsible Marketing Policy on ourofficialwebsite,tospecifyrequirementsforallemployees(includingfull-time,part-timeandtemporaryemployees)oftheGroupanditssubsidiarieswhenconductingmarketingcampaigns.Theseincluderequirementsoncompliancewithindustry laws and regulations and marketing, ads and sales rules applicable to us, accurate disclosure of information,protection of customer privacy, and fulfilment of environmental protection and social responsibility. Meanwhile, wehave developed the Code of Conduct for Sales Personnel of Joincare and other internal policies to regulate the marketingbehaviours of relevant personnel and ensure that all our publicity and marketing activities are in compliance with lawsand regulations.
Responsible Marketing AuditJoincare continues to improve its responsible marketing audit system and standardise the management of marketingactivities approval process. In the design, production and distribution of our product information and promotionalplans, all marketing materials are subject to the approval by authorised management personnel. Besides, we provideprofessional and timely marketing compliance consulting channels for employees to ensure that promotional materialscomply with laws and regulations. We also work with regulators and the media to review the compliance of all ourmarketing materials in the process of brand promotion and building, thereby effectively implementing responsiblemarketing.
?·Strictly abide by national laws and regulations;?·Strictly comply with the relevant provisions of the Good Supply Practice;?·Be honest and trustworthy in business activities, and uphold fairness in competition. In business activities, itis strictly prohibited to interfere with or affect the rational clinical use of drugs by exaggerating the efficacy ofproducts, making false and misleading statements, concealing adverse drug reactions and other means;?·The interests of enterprises and others shall not be harmed in business activities; the Group’s business secretsand customer privacy shall be protected;?·Illegal activities such as commercial bribery shall not be conducted for sales;?·Timely report adverse clinic reactions of drugs (if any) to the Group;?·Malicioustransregionalsalesarenotallowedtoa?ecttheorderofthesalesmarket.
The Code of Conduct for Sales Personnel of Joincare is summarised as follows:
Material production
Produce publicity materials in strict accordance with the Measures for the Examination ofDrug AdvertisementsReview by relevantdepartments
Review by the Business Department, Legal Department and Internal Control Department toensure that publicity materials comply with relevant policies and regulations of the GroupReview by regulatorsSubmit advertising materials to relevant regulators to obtain approval after reviewReview by media
Carry out the second round of review by targeted media, such as the “seven-party joint review”by DouyinAdvertisementdistribution
Distribute publicity materials in compliance with laws and regulations and according tomarketing plans
Compliance Review Process for Joincare’s Marketing Campaigns
Corporate Social Responsibility Report 2023WehavesetouttherequirementsforourresponsiblemarketingauditintheResponsibleMarketingPolicyandestablished the review and monitoring mechanism for responsible marketing materials. We regularly review marketingactivities and materials, including but not limited to marketing activity plans, promotional materials and sales documents,aiming to ensure that marketing activity is true, accurate and legal, free from false advertising and misleadinginformation,andcompliantwiththerequirementsoftheGroup’sResponsibleMarketingPolicy.Inaddition,ourSupervision and Audit Department conducts regular internal audits on the implementation of the Responsible MarketingPolicytoensurethatallmarketingactivitiesmeettherequirementsofthepolicy.
Livzon Group, Joincare’s holding subsidiary, has established a rigorous mechanism forresponsible marketing audit. Each year, it conducts at least one systematic responsiblemarketing audit on all business segments, including pharmaceutical products, APIs andintermediates, and diagnostic reagents and devices. In the audit, it checks whether its sales staffadhere to the Group’s responsible marketing policies, marketing compliance, false advertising,honest dealings with customers and other matters. For audit findings, Livzon Group willpromptly urge the relevant departments to take corrective action and will improve the relevantpolicies, to further consolidate its capabilities in responsible marketing management. Violationsof the policies will be reported throughout the group and those responsible will be punished(such as the deduction of points in the annual performance review and cancellation of bonuses)according to the nature and severity of the violations.
Annual responsible marketing audit at Livzon Group
Responsible Marketing Training
The Group provides regular responsible marketing training for all employees. To the marketing and compliancepersonnel,suchtrainingisdeliveredquarterly.Meanwhile,themarketingpersonnelwillreceiveadditionalprofessionaltraining on a regular basis, which covers marketing rules and policies, product knowledge, laws and regulations,compliancerisks,salestechniques,etc.Thetraining,whichtakestheformoffieldexercises,scenariosimulations,case studies and interpretation of laws and regulations, helps to ensure that employees understand and comply with ourmarketing and advertising policies, avoid exaggerated, misleading or false advertising, and provide consumers withtruthful and trustworthy product information. In 2023, all business divisions of Joincare actively carried out responsiblemarketing training, covering all the marketing personnel, with a total training time of 6,227 hours. Specifically, theHealthcare Product Division and the Prescription Medicine Division conducted 105 and 11 training sessions, respectively.
Joincare’sO?ineResponsibleMarketingTraining
Case
5.5.2 Customer Satisfaction
TheGroupconductsquarterlysurveysofonlineando?inecustomersregardingtheirsatisfactionwiththee?ectivenessof our products, the service provided by our customer service/in-store staff, product safety and packaging, and theirwillingness to recommend our products to others. The aim is to understand customers’ attitudes to, views of, andsuggestionsforourproductsandservices,soastoimproveourproductqualityandserviceprocessesaccordingtocustomerfeedback.Byfullymeetingcustomerneeds,westrivetoimproveourservicequalityandincreasecustomersatisfaction. In 2023, Joincare’s annual customer satisfaction rate reached 94%.Customer Communication and ComplaintsWe focus on building a multi-channel platform for communicating and interacting with customers, to understand theiropinions in time and meet their needs and expectations. Customers can make complaints on our official platform or bycalling our hotline. Our after-sales personnel will handle customer complaints and provide customers with reasonablesolutions after understanding their needs. We will also monitor the progress of the implementation of the solutions toensurethatcustomers’reasonablerequirementsaremet.Inaddition,weregularlycollectandsummariseissuesthatcustomersfrequentlycomplainabout,andorganiseoperations,product,logisticsandotherdepartmentstotaketargetedcorrective action for better customer experience.Toimprovetheskillsofcustomerservicestaff,weprovidethemwithquarterlytrainingoncustomercommunicationand complaint handling. In 2023, we ran a total of 18 customer service training sessions on themes including empathy,products, conversion rate and intelligent customer service assistance.Customer Privacy ProtectionWe abide by the Civil Code of the PRC, the Personal Information Protection Law of the PRC, and other laws andregulations on the protection of personal information. We have built a management system for customer privacy securityrisks to protect customer privacy.Where reasonable, we adhere the principle of “Data minimization” to minimise the collection of customer informationand other personal information, and allow customers to change their personal information by calling or emailing us. Forhighlycondentialinformation,wesigncondentialityagreementswithrelevantpartiesandtakenecessarymeasurestoensure information security. In 2023, there were no customer privacy breaches or customer privacy disclosures within theGroup.
5.6 Supply Chain Management
Joincare is deeply aware of the importance of ensuring the stability and sustainability of the supply chain and activelycooperates with suppliers to build a harmonious and win-win partnership. In strict compliance with relevant laws andregulations such as the Bidding Law of the PRC, we continue to improve the internal policies including the ProcurementControl and Management Procedures, the Supplier Management System, and the Material Supplier Selection Instructionto standardise procurement and supplier management.We have formulated and released the Code of Conduct for Suppliers to specify the main principles for suppliers inbusiness ethics, labour rights and human rights, health and safety, environmental protection and green development.Besides, our purchasing practices are continuously reviewed to ensure that our suppliers operate in alignment with ourCodeofConductforSupplierstoavoidpotentialconictswithESGrequirements.
Corporate Social Responsibility Report 2023
5.6.1 Supplier On-boarding Management
Wesetstrictstandardsforsupplieron-boardinginconsiderationoffairbidding,qualitypriorityanddiversifiedprocurement.Potentialsuppliersareevaluatedonthequalitycontrol,supplystability,environmentalandriskcontrolandotheraspectsthroughvariousformssuchasdeskassessmentandproducttestingtoverifytheirqualificationsandcapabilities. On even ground, we give preference to suppliers who have been certified to ISO 9001, ISO 14001, ISO45001, and ISO 50001, or who have obtained other EHS-related certifications such as green factory, clean productionreview,andsafetyproductionstandardisation.SuppliersincludedinthelistofqualifiedsuppliersshallsigntheProcurement Contract and the Quality Assurance Agreement and return the Supplier Questionnaire Survey and theSupplierEHSQuestionnaireSurvey,whichdenetheirresponsibilitiesofqualityassuranceandEHSmanagementinthesupply process, and their commitment to a stable and safe supply of production materials.
5.6.2SupplierClassicationandRiskControl
Toassessandmanagesuppliers,werstidentify,assessandmanagesupplychainrisks,includingenvironmental,socialand governance (ESG) impacts and business relevance aspects. We evaluate the ESG impact of suppliers by assessingtheir country-specific risk, sector-specific risk and commodity-specific risk, and identify our significant suppliers andsignicantindirectsuppliers.
Geographical Distribution of Suppliers
Southern China35%
Eastern China35%
Northern China8%
Central China14%Northeastern China2%Overseas
1%Southwestern China2%Northwestern China3%
Table:DetailsofJoincare’sSignicantSuppliers
Total number of Tier-1 suppliers4,084TotalnumberofsignicantsuppliersinTier-1567Totalnumberofsignicantindirectsuppliers83Totalnumberofsignicantsuppliers650
The risk level of suppliers is initially determined according to the type of materials they supply. We implementhierarchical management on suppliers and the existing suppliers are rated at three levels, namely H (high risk)/M(Mediumrisk)/L(lowrisk).Wecomprehensivelyconsidersuppliers’productqualityrisk,consumptionofmaterials,theimpactofmaterialsonproductquality,andtheriskfactorsinvolvedaboveeveryyear,andre-evaluatetheirrisklevelbasedontheirannualqualityreviewreports.
Enterprisequalication
Enterprisenancialstatus
企业经营环境Enterprisebusinessenvironment
Impact ofenvironmentand other EHS
Impactof majorunexpectedevents
Impact ofinternationalnanceandexchangeratesImpact ofunusual climate
Impactof socialevents
Impact offestivalsImpact ofbusiness ethics
Impact of workers’human rights
Enterpriseproductqualityand
service
Internationaltradeenvironmentand impact
Impact ofnationalenvironmentalprotectionregulations andpolicies
Dimensions ofSupply ChainRisks Assessmentof Joincare
Corporate Social Responsibility Report 2023
Toensureproductionstabilityandproductqualityandsafetythroughouttheproductionprocess,wehavedevelopedcomprehensive and systematic risk mitigation process and contingency plans based on our own supply chain andbusinesses. In procurement, we continue to improve our existing dual sourcing policy and have formulated relevantsystems for alternative suppliers. We have alternative suppliers for raw materials and excipients as well as keyconsumables to minimise the supply risks resulted from the material shortage of suppliers. In production, we conductresearch on preparations, establish production base for APIs, actively develop the API production process and strive forthe integrated production of “APIs-preparations vertical integration” to steadily improve our production capacity formajor raw materials. At the same time, the Group’s multiple manufacturing sites across the country can back up eachother, with the ability to provide production support in case of emergencies.
H (High-risk materials)Materials that directly affect theintrinsicqualityofmedicines.Such as APIs for medicineproduction.
M (Medium-risk materials)Materials that indirectly affect theintrinsicqualityofmedicines.Such as excipients for medicineproduction, packaging materials indirect contact with medicines, keyconsumables for preparations.
L (Low-risk materials)Materialsthata?ecttheexternalqualityorotherqualitycharacteristics of products.Such as packing materials.
In addition, we pay close attention to inventory levels in day-to-day operation. The following risk management measuresare taken to ensure the production stability from the source:
? Signing strategic cooperation agreements with key material suppliers to ensure stable supply of materials.? Planning for alternative suppliers and develop suppliers in advance to avoid single sourcing.? Adopting the safe inventory strategy and dynamically managing inventory levels for materials supplied by high-risksuppliers,tomaintainanoptimalinventoryleveltomeetsixmonthstoayear'sproductionrequirements.
JoincareHaibinimplementsdiversiedsupplystrategyandactivelyrespondstosupplychainrisks:
1. The company ensures that its main raw materials and packaging materials are purchased from
multiplesuppliers,andproductionconsumablesarechosenfromanumberofqualifiedsuppliers,inorder to avoid supply shortage and enhance stability.
2. The company plans to introduce domestic suppliers for exclusive imported materials, striving to
mitigate risks such as delayed delivery due to the change of the international pattern or suppliers' ownreasons.
Active response to supply chain risks at Joincare HaibinCase
To effectively prevent problems that affect supply chain stability such as supply chain disruption andsupplyshortageofqualiedsuppliers,XinxiangHaibinhastakenthefollowingmeasures:
1.Foreachtypeofkeyrawmaterial,thecompanyensuresthatthereare3ormorequaliedsuppliers
to keep the supply chain safe and stable.
2. The company predict the market supply and demand according to the annual cyclical supply of
products, and prepare certain safety stock of materials in short supply in advance to deal with theuncertainty caused by market changes.
3.Thecompanycontinuetofindanddevelopnewqualifiedsuppliers,ensuremulti-regional,multi-
channelanddiversiedmanagementofqualiedsuppliers,soastocopewithrisksbroughtbychangesof government policies and uncertain market supply and demand.
To deal with the potential supply chain risks such as material shortage, supply shortage and delayedsupply, Taitai Pharmaceutical reviews the past cooperation with suppliers and builds a feasible plan tomitigate supply risks:
1. The company regularly checks its inventory, establishes the minimum inventory alert line, and
makes preparations for material purchase in advance.
2.Thecompanyregularlyconductsdeskassessmentoron-siteauditofsuppliers’qualifications
and production sites to understand their latest operating status, and timely assists suppliers to solvedi?cultiesinproduction.
3. The company establishes long-term cooperations with suppliers and signs annual procurement
agreementstoensurethatsuppliersdeliveraccordingtorequirementsandtoreducetheriskofsupplyinterruption.
Active response to supply chain risks at Xinxiang Haibin
Taitai Pharmaceutical ensures supply chain stability
5.6.3 Supplier Audit and Evaluation
Joincare has formulated the On-site Audit Management Procedures, the Supplier Quality Review Management, theMaterialSupplierQualityAuditProcedures,amongothers,whichrequireperiodicalreviewsofsupplier’squalification,productionsite,processtechnologyandproductionfacilities,warehousemanagement,qualitymanagementsystem,environmental protection and occupational health and safety management. This year, we further revised our SupplierManagementProcedurestosetstrictermanagementrequirementsforthoseinvolvedintheGroup’ssupplieraudits,andtoclarifytheapprovalprocessofsuppliers.Inaddition,wecontinuetostrengthenthemanagementofsignicantindirectsuppliers, conducting on-site audits of the manufacturers of key products purchased from distributors (the significantindirect suppliers of the Group). We also inspect the production facilities and management of the upstream supply chaintoensurethatsignicantindirectsuppliersarequalied.
Case
Corporate Social Responsibility Report 2023Wedeterminetheauditfrequencyandformaccordingtotheriskclassificationofsuppliers.Incaseofanymanagementorqualitydecienciesduringtheaudit,wewillinformthemthroughqualityfeedbacknotice.TheresultsareconsolidatedintheSupplierQualityAuditReportastherequirementsforsupplierstomakerectificationsandimprovement.Wealsofollow up on the rectifications of suppliers in a timely manner, collect rectification reports, and help them to improvequalitymanagement.In2023,weauditedatotalof1,130tier-1suppliersinaccordancewiththeannualsupplierauditplanandconductedon-siteauditsto69signicantindirectsuppliers.
Supplier's AuditProduct TransportationProduction Management
Plant FacilitiesandEquipment
QualicationsEHS ManagementQuality managementMaterial management
Personnel Organisationand Training
Suppliers’ Audit Dimensions of Joincare
Table:SuppliersauditfrequencyandformofJoincare
SupplierclassicationAuditfrequencyandformH (High-risk materials)One on-site audit every 3 yearsM (Medium-risk materials)Onedeskauditonqualityevery3yearsL (Low-risk materials)Onequalicationinformationupdateevery3years
In addition to the supplier audit, we also evaluate suppliers every year to get a timely and comprehensive understandingof supplier management. According to the Supplier Annual Evaluation Form, we give suppliers a letter grade of A, B, C,andDbyassessingtheirproductquality,productdeliveryaccuracy,productdeliverytimelinessandservicesatisfaction.Amongthem,levelCsuppliersarerequiredtomakerectificationswithinatimelimit,duringwhichwewillreducethequantitywepurchasefromthemaccordingly.Thesesupplierswillbere-evaluatedandreclassifiedafterrectifications.LevelDrepresentsunqualified.WewillimmediatelyendthecooperationwithsuppliersratedlevelDandrevoketheirsupplyqualificationsforthreeyears.Thedistributionofprocurementsharesinthenextyearislargelydeterminedby the annual comprehensive supplier evaluation. Depending on business conditions and the results of the annualcomprehensive supplier evaluation in the previous year, subsidiaries of the Group will make appropriate adjustmentsto the procurement ratio of the current year. In 2023, the Group conducted an annual comprehensive evaluation of 438signicantsuppliers,eitherthroughdeskassessmentsoron-siteassessments.
5.6.4 Supplier ESG Management
Joincare keeps a close eye on suppliers’ sustainable development management and performance, and systematicallymonitors their ESG management. The Corporate Social Responsibility Committee of the Board of Directors, as thehighest decision-making body, is responsible for overseeing the implementation of supplier ESG programmes. At thesametime,wehaveclariedtheenvironmental,socialandgovernancerequirementsforsuppliersintheCodeofConductfor Suppliers, and increased our focus on suppliers’ ESG management performance when onboarding, auditing andevaluating them.
We conduct an EHS survey and score on suppliers as part of the on-boarding process, and take the score as one of thefactorsforsupplieradmission.Intheearlystageofcooperation,weorganisesupplierstolearnthespecicrequirementsof the Group’s Code of Conduct for Suppliers, guide them towards more sustainable production and operations, andencourage them to obtain management system certifications such as ISO 14001 and ISO 45001 to mitigate ESG risksin the supply chain. By the end of the reporting period, the Group and subsidiaries had 491 suppliers that obtainedcerticationforenvironmentalmanagementsystemsand470suppliersthatobtainedcerticationforoccupationalhealthand safety management systems.We fully review suppliers’ ESG management and implementation of the Code of Conduct for Suppliers during supplieraudits and evaluations, and share ESG related regulations and regulatory trends with suppliers during on-site audits.SuppliersthatarefoundtobeinbreachoftheGroup’sESGrequirementsduringtheauditandassessmentwillbeexcludedfromcontractingiftheycannotachieveminimumESGrequirementswithinaspeciedtimeframe.Tosupervisesupplier EHS management, we have formulated the Supplier EHS Audit Management Procedure to clarify the EHSauditandrelevantmanagementrequirementsforsuppliers.SupplierEHSauditincludessafety,environmentalprotectionand other fields, covering toxic and harmful emission indicators such as particulate matter, sulphide, VOCs emission,to review the supplier's management of indirect discharge of water pollutants, air pollutant emissions, noise and otheremissions. We organise the EHS audit for suppliers every year, the results of which will be considered as an importantfactor for the next annual purchase share assessment. This can urge suppliers to promote their EHS management.Procurementsta?arealsoorganisedtolearnaboutthesupplierESGmanagement.ThisenablesthemtofamiliarisetheirroleswithoursupplierESGprogram.Besides,weorganiserelevanttrainingtohelpprocurementsta?betterunderstandsupplier ESG management, so that they can ensure strict compliance with the supplier ESG management standards intheir daily work, thereby contributing to building a sustainable supply chain.
Xinxiang Haibin has incorporated EHS audits into the annual supplier audit plan. The audits coverssta?occupationalhealthandsafetymanagement,wastewaterpre-treatment,wastegastreatment,andsolid waste treatment. At the same time, Xinxiang Haibin focuses on the supplier’s treatment of toxicand harmful emissions, reviewing its VOC emissions, exhaust gas and other indicators.
Livzon Group, a holding subsidiary of Joincare, has incorporated EHS audits on suppliers into theannual supplier audit plan. The audit covers environmental and safety indicators, such as energyconservation and emission reduction, compliance with pollutant discharge standards, compliancewithsolidwastecollectionanddisposalregulations,andISOsystemcertication.Inaddition,LivzonGroup closely monitors the harmful emissions of suppliers, including sulfur dioxide emissions andhazardous waste treatment indicators into the scope of audits.
EHS audits conducted by Xinxiang Haibin on suppliers
EHS audits conducted by Livzon Group on suppliers
Case
Corporate Social Responsibility Report 2023
5.6.5 Supplier Capacity Building
We provide multiple channels including training, exchanges, and collaboration to help our suppliers build theircapacity.Toensurethesafetyandreliabilityofourproducts,wecarryouttrainingonqualityassurancecoveringallhigh-risksuppliersatleastannually.Duringtraining,weemphasisetheGroup’squalitystandardsandrequirementstosuppliers, help them analyse existing areas of improvement, provide guidance on environmental protection, technicalimprovement and other aspects, and encourage them to develop and implement relevant measures. In addition, we willfurthersummarisethequalityproblemsfoundinsupplierauditsandannualevaluations,andconductspecialtrainingandcommunicationforsupplierstoimprovetraininge?ciency.In2023,theGroupconductedtrainingonqualityassurancefor all high-risk suppliers.
?InDecember2023,JoincareHaibinprovidedqualityassurancetrainingforalltier-1materialsuppliers,communicatingtheGroup’squalitymanagementgoalstosuppliers,andhelpingthembetterunderstandthekeypointsofqualityandEHSmanagement.?Xinxiang Haibin conducted 30 supplier training sessions in 2023, during which the BusinessDepartmentandtheQualityDepartmentjointlyelaboratedontherequirementsofqualitymanagement, deviation management and supplier management.?In 2023, Jiaozuo Joincare trained level A material suppliers and fermentation raw material suppliersthroughthecasestudyof“Asmallstorytounderstandqualitymanagement”tohelpthemgodeepintothequalitymanagementsystem.TheCompanyalsoactivelysupportssuppliersinimprovingtheirownsuppliermanagementlevel,andhelpsthemstaycomplaintwithregulatoryrequirementsandbuildrobustsuppliermanagementprocessestoensurethequalityandsafetyofmaterialsfromthesource.
Supplier training of Joincare’s each subsidiariesCase
Access to
Healthcare
Acting in the interests of patients and focusing on safeguarding human life and health, Joincare carefully conceives the corporatevisionof“Diligentlymakehigh-qualitydrugsandinnovativedrugs”.Weputgreateffortintothehealthcareindustryandrmlyimplementthedual-drivecorestrategyofinnovativemedicinesandhigh-barriercomplexformulations,andfocusontheunsatisedclinicalneeds,constantlyconsolidatingourpositionastheleaderofChina’shigh-endinhalationformulationssector.Weendeavourtoimprovetheavailabilityandaffordabilityofhigh-qualitypharmaceuticalproductsandservices.Wemakesustainede?ortstooverseasbusiness,contributetoimprovingthequalityandcapacityofhealthservicesindevelopingcountries,and facilitate the improvement of human health by working with stakeholders.The Board of Directors of Joincare, as the highest organ represent for Access to Healthcare issues, is responsible forunderstanding and monitoring the management of the Group’s Access to Healthcare issues through the Corporate SocialResponsibility Committee. The Corporate Social Responsibility Committee is responsible for regularly reviewing thedevelopment of the Group’s strategies & policies and performance on Access to Healthcare issues, overseeing and reporting theprogress to the Board of Directors, and urging the Group to improve access to healthcare.
SDGs in this section
Corporate Social Responsibility Report 2023
6.1 Focusing on R&D and Innovation
Focusing on the development of innovative medicines and high-barrier complex formulations, the Group actively seekscutting-edge technologies and development opportunities at home and abroad. We practise the R&D mode that integratesindependent R&D, license-in and cooperative development, and focus on key treatment fields, including respiratorydiseases, digestive system diseases, assisted reproduction, psychiatric disorders, and tumour immunity. Moreover, wecontinuously expand the product line and R&D pipeline in areas where we have an advantage.We have a multi-level R&D mechanism and an experienced R&D team for independent R&D. To promote independentR&D, we continue to invest more and strengthen the construction of innovative technology platforms for inhalationadministration, antibody, sustained-release microspheres, and complex injection, and expand the R&D of other high-end formulations with market potential and new drug delivery devices. By the end of the reporting period, the Group hadmade landmark progress in many high-barrier complex formulations, obtaining a number of approvals for productionor clinical trials. In terms of cooperative innovation, we introduce new technologies and products through cooperativedevelopment,technologytransfer,patentlicensingandotherways.Basedonthis,wecanrapidlypromotethesubsequentpharmaceutical, clinical and non-clinical research and study on industrial transformation of new products. We also workwithrst-tiertopR&DteamsinChinatoenhanceproductdevelopmentinareaswherewehaveanadvantageandspeedup the transition to an innovative pharmaceutical enterprise.In addition, the Group actively explores the application of new technologies in the traditional pharmaceuticalmanufacturing industry. It has established long-term cooperative relations with well-known universities, scientificresearch institutions, and laboratories both domestically and abroad. Based on this, we create an enterprise technologyinnovation network with coordinated efforts of enterprises, universities, and research institutions. We now have threenational R&D technology centres and several provincial and municipal innovation carriers; meanwhile, in termsof biosynthesis, eight R&D platforms have been established for synthetic biology, industrial microbial breeding,biochemical APIs, biocatalysis, biological transformation and amplification, product extraction, drug synthesis, andAI in pharma. To build a biosynthesis platform, the Group has established an operating system that facilitates geneticmodification, simultaneous gene editing and high-fidelity multi-DNA splicing of various prokaryotic and eukaryoticmicroorganism. In addition, we have developed a complete set of processes for whole-genome variation analysis andpredictionofgeneclustersofkeysecondarymetabolites.Withthesee?orts,wehavemadetargetedgenomemodicationand fusion possible, enhancing our capabilities in gene capture and manipulation of large DNA segments. We have alsoimproved the technologies such as high-throughput DNA splicing and large-scale targeted genetic screening. In addition,we have expanded the technical system that restructures the metabolic network with predicted molecular elementsto breed various candidate strains with the upgraded genetic modification. In the future, we will continue to enhancetechnologicalinnovationabilitytodrivethepharmaceuticalindustry’shigh-qualitydevelopment.By the end of the reporting period, the Group’s R&D team had been growing continuously, with 1,740 R&D personnel.We also have continuously increased investment in R&D. This year, the total R&D expenditures amounted toRMB1,631.86 million, accounting for 9.80% of the total audited revenues of the year.
2019
Number and Proportion of R&D Personnel of Joincare in 2019-2023
2020202120222023
Number of R&D personnel(persons)Proportion of R&D personnel
9.27%
12.49%12.2%12.16%12.11%
1,1771,5571,6151,7171,740
Table: Major R&D/registration progress of Joincare in 2023DateMajor R&D/Registration ProgressJanuary 2023Approval for drug registration obtained for Tocilizumab InjectionJanuary 2023Clinical Trial Approval Notice obtained for Asenapine Transdermal PatchJanuary 2023ClassIIMedicalDeviceRegistrationCerticateobtainedformeshatomiserAir360mini+TFebruary 2023
ThersttosubmittheANDAinChinaforSalmeterolXinafoateandFluticasonePropionatePowder for InhalationMarch 2023Approval for drug registration obtained for Long Chain Fat Emulsion Injection (OO)May 2023New indications obtained for Ilaprazole Sodium for InjectionMay 2023New indications obtained for Tocilizumab InjectionMay 2023Approval for drug registration obtained for Triptorelin Acetate Microspheres for InjectionJune 2023Class I Medical Device Registration completed for Smear-type ApplicatorJune 2023Approval for drug registration obtained for Biapenem for InjectionJuly 2023Approval for drug registration obtained for Formoterol Fumarate Solution for InhalationJuly 2023
Recombinant Anti-human IL-17A/F Humanised Monoclonal Antibody Injection underwentthe phase III clinical trialJuly 2023
Approval for clinical trials obtained for Recombinant SARS-CoV-2 Fusion Protein Bivalent(Prototype/Omicron XBB Variant) Vaccine (CHO Cell)August 2023NDA for new indications accepted for Triptorelin Acetate Microspheres for Injection
Joincare’s R&D Expenditures and Proportion of Its Total Revenues in 2019-2023
Amount of R&D expendirures(RMB in 1 milion)Proportion of R&D expendiruresto total revenues
20192020202120222023
8.90%
9.32%
10.26%
1,065.981,260.531,849.821,758.66
11.63%
9.80%
1,631.86
Corporate Social Responsibility Report 2023
6.1.1DiversiedProductDevelopment
Committed to Respiratory Health
Chronic respiratory diseases are a major category of diseases represented by chronic obstructive pulmonary diseases(COPD), asthma, etc., featuring a high prevalence rate, high disability rate, high mortality rate, and high disease burden.Asthebestandmosteffectivetherapymethodsforchronicrespiratorydiseases,inhalationformulationscanquicklyand directly reach the lungs to play their therapeutic effect, reducing drug dose and improving drug efficacy. However,foreign companies have long monopolised the market due to the high barriers to R&D and production. As a leader ofthe inhalation formulations sector in China, Joincare, adhering to the original aspiration of “joining us in respiratorycare”, continues to improve the market presence of respiratory disease medicines, and strengthen the R&D of inhalationformulations through extensive industrial cooperation, to support domestic respiratory disease treatment.We have established R&D platforms for inhalation formulations and formed an integrated and clear R&D pipeline, incooperation with Dr. Jin Fang, the leader and pioneer in the R&D of inhalation formulations in China, and her R&Dteam, as well as the Guangzhou Institute of Respiratory Health led by Academician Zhong Nanshan. After years of steadydevelopment, we have become one of the leaders in the R&D of high-end inhalation formulations in China. Our existingproducts and products under R&D cover all types of drugs for inhalation therapy for COPD and asthma, providing moree?ectiveandsafedrugsforpatientswithCOPDandasthma.By the end of the reporting period, the Group had 8 varieties of inhalation formulations in 12 specifications on themarket. In 2023, we had several respiratory products under R&D. In terms of inhalation formulations, FormoterolFumarate Solution for Inhalation is approved for launching. Indacaterol Maleate Powder for Inhalation and FluticasonePropionate Nebuliser Suspension are under review for listed approval. Salmeterol Xinafoate and Fluticasone PropionatePowder for Inhalation, a generic drug which has been first submitted for registration application in China following thepublicationoftheGuidelineforBioequivalenceStudyonGeneticDrugsofOrallyInhaledDrugProductsin2020,hasledapplicationforlaunching.Intermsofdevices,wecontinuetodevelopmedicaldevicesthatarecompatiblewithourinhalation formulations. Our mesh atomiser Air 360 mini + T that can be used with Tobramycin Inhalation Solution hasobtainedtheClassIIMedicalDeviceRegistrationCerticate.Inaddition,wehavemadesignicantprogressinanumberof R&D projects of Class 1 innovative medicines. Among them, new anti-influenza drugs TG-1000 Capsules haveinitiated the phase III clinical trials and completed the enrolment plan. Both the new dual-target drug DBM-1152A andnew oral drug N91115 for asthma have initiated the phase I clinical trials and are undergoing clinical studies.
DateMajor R&D/Registration ProgressAugust 2023Approval for drug registration obtained for Blonanserin TabletsSeptember2023
NDA accepted for Aripiprazole Microspheres for InjectionSeptember
2023
TG-1000 Capsules initiated the phase III clinical trialOctober 2023Clinical Trial Approval Notice obtained for Elagolix Sodium TabletsNovember2023
Clinical Trial Approval Notice obtained for Meloxicam Nanocrystal InjectionDecember 2023
Emergency use granted for Recombinant SARS-CoV-2 Fusion Protein Bivalent (Prototype/
Omicron XBB Variant) Vaccine (CHO Cell)
Joincare Pharmaceutical Group Industry Co., Ltd. Throughout 2023, our R&D progress in respiratory formulations was shown as follows:
Table: Joincare’s R&D progress in respiratory formulations in 2023Medicine FormProduct Name
RegistrationCategory
Preclinical
Clinical Trial/BE Trial
NDA/ANDAPhase IPhase IIPhase III/BE
Solution forInhalation
DBM-1152A
Chemicaldrugs Class 1
>>>>>>>>>XYP-001
Chemicaldrugs Class 2.2and 2.4
>>>>>>>>>Fluticasone PropionateNebuliser Suspension
Chemicaldrugs Class 4
>>>>>>>>>
Powder forInhalation
Indacaterol Maleate Powder forInhalation
Chemicaldrugs Class 4
>>>>>>>>>Salmeterol Xinafoate andFluticasone Propionate Powderfor Inhalation
Chemicaldrugs Class 4
>>>>>>>>>Indacaterol Maleate andGlycopyrronium BromidePowder for Inhalation
Chemicaldrugs Class 4
>>>>>>>>>Inhalation Aerosol
Mometasone Furoate andFormoterol Fumarate DihydrateInhalation Aerosol
Chemicaldrugs Class 3
>>>>>>>>>Formoterol FumarateInhalation Aerosol
Chemicaldrugs Class 2.2
>>>>>>>>>Oral Formulations
TG-1000 Capsules
Chemicaldrugs Class 1
>>>>>>>>>N91115
Chemicaldrugs Class 1
>>>>>>>>>R&DE?ortsinBio-PharmaOver the years, LivzonBio, a subsidiary of Joincare, has kept exploring biomedicine. It has built well-developed R&D and productiontechnology platforms for antibody medicines and fusion protein medicines. LivzonBio focused on the development of productsrelated to autoimmune disease, tumour, reproduction, and major communicable disease prevention and has carried out and promoted anumber of R&D projects for innovative vaccines, monoclonal antibodies, and recombinant protein drugs.LivzonBio speeds up the approval of new products through independent R&D, license-in, strategic cooperation, and other ways.Relying on the well-developed R&D and industrialisation conditions of recombinant protein drugs, LivzonBio continuouslyenriches the pipelines of products under research and improves the commercialisation of products. In December 2023, as proposedby the National Health Commission of the PRC, the National Medical Products Administration demonstrated and approved for theemergency use of the Recombinant SARS-CoV-2 Fusion Protein Bivalent (Prototype/Omicron XBB Variant) Vaccine (CHO Cell)(“丽康民?”) developed by LivzonBio. It is the Company’s second COVID-19 vaccine allowed for emergency use after丽康V-01.丽康民?, a broad-spectrum bivalent vaccine developed by LivzonBio based on the same platform as丽康V-01, uses an innovativemolecular design and covers various key mutation sites of COVID-19 epidemic variants such as XBB.1.9.1, XBB.1.5 and XBB.1.16.By the end of the reporting period, this vaccine had undergone the clinical trials in accordance with the protocol approved by theNational Medical Products Administration and had completed the enrolment of all subjects, reaching the preset major study endpoint.According to the results of clinical trials,丽康民?features fast onset, high antibody titre, high safety, and excellent immunogenicityandsafetyintheelderly,o?eringgoodprotectionagainstthecurrentmainepidemicstrains.Moreover, this year Recombinant Anti-human IL-17A/F Humanised Monoclonal Antibody Injection (“LZM012”), which is jointlydeclared by LivzonBio and Beijing Kanova Biopharma Co., Ltd. as the key product under research, is undergoing the phase IIIclinical trial. LZM012 is the first drug in China that is under the phase III clinical trial comparing with active IL-17A listed drug(Secukinumab). The results of the phase II clinical trial show that, LZM012 has fast onset, good efficacy, long acting and otheradvantages.ItisalsosuperiortoIL-17Asingle-targetdrugsine?cacy,andisexpectedtoprovidebetterpotentialtherapeuticschedulefor psoriasis in China.
Corporate Social Responsibility Report 2023 Table: LivzonBio’s R&D progress of key products under research
FieldMedicine Code (Full name)Preclinical
Clinical Trial
NDA/ANDAPhaseIPhaseIIPhaseIIIVaccine
Recombinant SARS-CoV-2 Fusion Protein Bivalent(Prototype/Omicron XBB Variant) Vaccine (CHO Cell)
Emergency use
grantedAnti-tumour
Lipstobart for Injection>>>>>>>>>A-01(RecombinantTumourEnzymeSpecicInterferonα-2bFc Fusion)
>>>>>>>>>AssistedReproduction
B-01 (Recombinant Human Follicle Stimulating Hormone)>>>>>>>>>
Recombinant Human Choriogonadotropin alfa for Injection
>>>>>>>>>(Overseas NDA)ImmuneDisease
LZM012 (Recombinant Anti-human IL-17A/F HumanisedMonoclonal Antibody Injection)
>>>>>>>>>
Development of Sustained-Release Microspheres for InjectionMicrospheresaremicrosphericalpolymerspreparedwithhighmolecularmaterialswithaparticlesizeof1-250μmandcontaining one or more drugs. Microsphere formulations are superior to traditional injection formulations in long actingand high bioavailability. They have specific tropism to target organs and can greatly improve drug convenience andcompliance, with outstanding clinical advantages. Livzon Microsphere, a subsidiary of Joincare, focuses on the R&Dof anti-tumour, endocrine-regulating, and antipsychotic microsphere formulations, which are advantaged for their long-acting and sustained-release mechanism. The company has an overall arrangement in long-acting eye medication and anin-depth study of long-acting formulation technology with independent intellectual property rights (IIPR). In May 2023,Triptorelin Acetate Microspheres for Injection (“维宝宁?”),amodiednewdrugdevelopedbyLivzonMicrosphere,wasapprovedforlaunching.Itisindicatedforthetreatmentofpatientswithprostatecancerwhorequireandrogendeprivation therapy. As the only domestic Triptorelin Microsphere,维宝宁?o?erssignicantadvantagessuchasalongerdurationofactionandfewerdosesrequired,comparedwiththeregularTriptorelinAcetateInjection.Itcanreducethepatients’painanddrugburden,e?ectivelyimprovingthedrugtoleranceandaccessibility.By the end of the reporting period, the sustained-release microsphere R&D platform had 8 ongoing projects. Amongthem, 3 medicines were under application for launching approval and registration, 1 medicines was at phase I clinicaltrials, 2 medicines were at BE (pilot) trials.
In November 2023, Joincare signed an agreement with Guangzhou Fermion Technology Co., Ltd.(“Fermion”)toacquiretheexclusivelicenseofnewanalgesicFZ008-145independentlydevelopedbyFermion in Greater China. The innovative small molecule drug FZ008-145 is the world’s second andChina’srstsecond-generationhighlyselectiveNav1.8(voltage-gatedsodiumchannel1.8)inhibitor.Itisintendedforthetreatmentofpainandisagoodremedyfore?ectiveandnon-addictiveanalgesia.In January 2024, the Clinical Trial Approval Notice was obtained for FZ008-145. Joincare will beresponsibleforsubsequentworksuchasclinicalstudiesandmanufacturingdeclaration.AsitsMAHholder, we will obtain the right to manufacture and sell this product in Greater China after its approval.Thanks to this cooperation, the Group enriched its layout in R&D pipeline of analgesics. Goingforward, we will speed up the clinical development of FZ008-145 so as to provide better treatmentoptions for patients with pain as soon as possible.
JoincareacquiredexclusivelicenseofFermion’snewanalgesicFZ008-145inGreaterChina
Table: Livzon Microsphere’s R&D progress of key products under research
Project NameIndicationPreclinical
Clinical Trial/BE Trial
NDA/ANDAPhaseIPhaseIIPhase III/BETriptorelin Acetate Microspheres forInjection (1-month sustained release)
Endometriosis>>>>>>>>>Octreotide Acetate Microspheres forInjection
Acromegaly, gastrointestinalpancreatic endocrine tumour
>>>>>>>>>Leuprorelin Acetate Microspheres forInjection (3-month sustained release)
Prostate cancer, premenopausalbreast cancer
>>>>>>>>>Alarelin Acetate Microspheres forInjection (1-month sustained release)
Prostate cancer, estrogen-receptor-positive premenopausal breastcancer, endometriosis
>>>>>>>>>Aripiprazole Microspheres for InjectionSchizophrenia, bipolar disorder>>>>>>>>>
6.1.2 External Cooperation and Recognition
The Group makes continuous efforts in cooperative development and license-in of products in core fields, whilestrengthening independent innovation. We leverage the global superior resources and cutting-edge technologiesto enhance the Group’s marketing and integration capabilities. This year, we made phased progress in businessdevelopment, introducing many innovative drugs and continuing to develop respiratory drugs and analgesics. In addition,we have taken the lead in AI-driven pharmaceutical R&D. In 2021, we signed a Strategic Cooperation Agreement withTencentQuantumLabtodrivetheapplicationof“quantumcomputing+AI”inresearchfieldsofsyntheticmicrobialbiology and relevant drugs, and to promote the development and progress of pharmaceutical R&D technology.
Case
Corporate Social Responsibility Report 2023
In March 2023, Joincare signed a Patent Licensing and Commercial Cooperation Contract with TaiGenPharmaceutical R&D (Beijing) Co., Ltd. and TaiGen Biotechnology Co., Ltd. (collectively “TaiGen”)toacquiretheexclusivelicensetodevelop,manufactureandcommercialisethenewantiviraldrugTG-1000 in China (including the Hong Kong and Macao Special Administrative Regions). TG-1000is primarily indicated for the treatment of acute infective simple uncomplicated influenza A and Bviruses. According to the current data, it has the advantages of fast onset, long duration of inhibition,good tolerance, oral administration not affected by food, and low drug resistance. By the end of thereporting period, the Group had initiated the phase III clinical trial of TG-1000 and completed theenrolment plan. It is expected that after TG-1000 is on the market, its APIs will be manufactured in thehigh-end API project in Macun District, Jiaozuo City, Henan Province. This will play an important rolein expanding, complementing and strengthening the biomedical industry chain in Macun District.
JoincareacquiredexclusivelicenseofTaiGen’snewantiviraldrugTG-1000inGreaterChina
In 2023, Joincare and its subsidiaries gained many external honours and recognition. The Group won the titles of “Top100 Enterprises in China’s Pharmaceutical Industry”, “China’s Top 500 Manufacturing Private Enterprises”, “Top 100Manufacturing Private Enterprises in Guangdong Province”, and “Top 100 Private Enterprises in Guangdong Province”.Shanghai Frontier, a subsidiary of Joincare, was newly awarded “Shanghai Enterprise Technology Centre”, and re-qualifiedas“High-techEnterprise”and“Specialised,Refined,DifferentialandInnovativeSmallandMedium-sizedEnterprises of Shanghai”. Joincare Haibin, a subsidiary of Joincare, was awarded the “Engineering Research Centre ofKey Technology Study and Innovative Technology Application for Industrialisation of Inhalation formulations” by theDepartment of Science and Technology of Guangdong Province. In addition, as the world’s first inhalation formulationandtheChina’srstinhaledantibioticforthetreatmentofbronchiectasis,健可妥?,amodiednewdrugdevelopedindependently by Joincare, was presented at the “2023 Conference on the Development of China’s PharmaceuticalIndustry and Achievement Tour Exhibition for the Development of Chinese Pharmaceutical Industry in the New Era”,showcasing the Group’s remarkable achievements in the R&D of inhalation formulations.
6.2 Paying Attention to Rare Diseases Treatment
Rare diseases, also known as “orphan diseases”, are featured by unknown causes and extremely low incidence rates.Hightreatmentcostsforrarediseasesresultfromtheirlowmarketdemand,di?cultiesinR&Dandlackofexperienceinclinical medication, and even there is no medicine for some rare diseases. Under the guidance of relevant policies suchas the “Healthy China 2030” Planning Outline and the Guidelines for Diagnosis and Treatment of Rare Diseases, we,basedonourownscienticplatformandcapabilities,undertakecorporatesocialresponsibilityactivelybycontinuouslyinvesting in research on rare diseases, and focusing on improving the current situation of diagnosis and treatment of rarediseases, thus making contributions to building a Healthy China.
Case
Idiopathic Pulmonary FibrosisIdiopathic Pulmonary Fibrosis (“IPF”) is a cryptogenic, chronic, progressive, and interstitial pneumonia. This diseaseusuallya?ectsmiddle-agedandagedpeopleandhascardinalsymptoms,includingprogressivelyincreaseddyspneawithrestrictive ventilation dysfunction and ventilation dysfunction. Besides, it is featured by rapid progress, poor prognosisand no proven effective treatment to date. It’s proved that traditional hormone therapy or anticoagulant therapy isunabletoalleviatethediseaseprogressionofIPF,andithasstrongsidee?ectsortheriskofaggravatingcomplications.Therefore, it is not recommended for the treatment of IPF. Due to the limitations of existing drugs, Joincare developedthe modified new drug XYP-001 in 2022, which is a new mechanism/target drug in IPF indication development area.The Company successfully obtained the Clinical Trial Approval Notice issued by the National Medical ProductsAdministration in September of the same year. By the end of the reporting period, the phase I clinical trial of XYP-001had been successfully completed, with the phase II clinical trial scheduled to start. If it is launched, it will be a new andmore secure drug alternative for IPF patients. While developing the treatment research of IPF, we pay close attention toother rare respiratory diseases (such as pulmonary arterial hypertension) and take active efforts in preliminary projectresearch.
Malignant HyperthermiaMalignant Hyperthermia (“MH”), a rare clinical hereditary disease that can cause perioperative death due to conventionalanaesthesia, has an extremely low incidence rate and an extremely high mortality rate. Dantrolene Sodium for Injection istheonlyspecicmedicineforthetreatmentofthedisease.DuetothehighchallengeinR&Dandlow-protmargin,noenterprise in China had been engaged in R&D and production of the drug for a long time. Joincare’s holding subsidiaryLivzon Group began to plan the R&D of the medicine in the early days. After over a decade of arduous exploration,it obtained the medicine registration certificate in October 2020, and thus became the first enterprise in China tosuccessfully produce generic Dantrolene Sodium for Injection, bringing good news to the vast number of MH patientsand anaesthetists in China. In the future, we will further appeal to hospitals with clinical needs to stock DantroleneSodium for Injection and include it in the essential drugs for clinical rescue to save the lives of MH patients in time.Acromegaly
Acromegaly is an endocrine and metabolic disease caused by hypersomatotropism of the adenohypophysis. TheOctreotideAcetateMicrospheresfortreatmentofthediseasearefeaturedbythetechnicaldi?cultyofmassproduction,the high R&D cost, the long R&D cycle, and the high import price, financially burdening patients and the nationalmedical insurance system. Based on the urgent need for localisation, Livzon Microsphere, a subsidiary of Joincare,has initiated the imitation of Octreotide Acetate Microspheres for Injection and obtained approval for clinical trials inSeptember2020,whichallowedbioequivalence(BE)studiestobeconductedonhealthypeopleincontrastwiththebrand-name medicines. By the end of the reporting period, Livzon Microsphere was conducting BE study for OctreotideAcetateMicrospheresforInjection,expectingtoprovidegenericdrugswithguaranteedqualityandefficacyassoonaspossible to relieve the burden of patients with acromegaly.Thymic tumourA thymic tumour is a relatively rare type of thoracic neoplasm. Pathological classification of the World HealthOrganisation classifies it as a thymic epithelial tumour, including thymoma and thymic carcinoma, with an incidence of
1.3-3.2 per million. Thymic Carcinoma is a rare Epithelial Malignancy, which is more aggressive than thymoma. Most
patients with thymic carcinoma are exposed to external invasion or metastasis at the first discovery. The incidence andsurvival time of patients with thymic carcinoma is significantly lower than those with thymoma. At present, thymiccarcinoma still lacks effective targeted therapy drugs. Evidence-based medical evidence is limited, and the predictivemarkers and prognosis are uncertain.Lipstobart for Injection (“LZM009”), a product under research by the Group’s subsidiary LivzonBio can inhibit oractivate receptors by targeting the protein to enhance immune response and improve cancer prognosis. By the end of thereporting period, LZM009 had completed the enrolment in phase II clinical trial for the selected subjects in the patients
Corporate Social Responsibility Report 2023with advanced thymic carcinoma. According to the clinical results, the phase II clinical trial has reached the presetefficacy. LZM009 has shown good efficacy and safety in the patients with recurrent or metastatic thymic carcinomawho have failed first-line chemotherapy, making it clinically superior to other alternatives mentioned in the diagnosisand treatment guidelines. In July 2023, application for communication before new drug application (NDA) in Chinawas submitted for LZM009. If it is smoothly approved for launching, it is expected to provide more options and bettertherapeutic schemes for the treatment of thymic tumour.Systemic juvenile idiopathic arthritisSystemic juvenile idiopathic arthritis (“sJIA”) is a rare chronic systemic disease that usually affects children aged 16years or younger. sJIA, mainly featured by arthralgia lasting 6 weeks or more and accompanied by damage to othertissues and organs, is one of the most severe subtypes in juvenile idiopathic arthritis. At present, the incidence rate inChina is about 0.01%.Tocilizumab Injection (“安维泰?”), a Recombinant Humanised Monoclonal Antibody targeting Interleukin-6 Receptor (IL-6R) developed by LivzonBio, a subsidiary of Joincare, was approved for marketing with the indications of rheumatoidarthritis in January 2023. In May 2023, the supplementary application of安维泰? was approved by the National MedicalProducts Administration for additional indications in sJIA and cytokine release syndrome (CRS). Tocilizumab Injectionis the only biologics approved for sJIA indications in China, and also the drug for the treatment of sJIA active systemicsymptoms or active sJIA with failed first-line treatment, as recommended by domestic and overseas definitive guides.Characterised by fast onset and sustained efficacy, it can rapidly improve the disease activity index of child-patients,timely control the conditions, help them catch up on growth and reduce damage to the joint structure, providing a newtargeted option for the treatment of child-patients with sJIA.
6.3 Improving Product Availability
To improve our product availability and make more safe and effective products available to global patients, Joincareexpands the production and marketing of vaccines, patent medicines, generics, APIs, and IVD (In-Vitro Diagnostics)reagents and devices overseas mainly via direct operation and authorising local distributors. So far, our products havebeen approved for registration in major pharmaceutical markets and emerging markets in multiple countries and areasacross Asia, Europe, North America and Africa. During 2023, our revenues generated from overseas businesses reachedRMB2,583.65 million, representing a 5-year compound annual growth rate of 7.93%.Joincare’s Main Business Revenue Overseas and Proportion of Its Total Revenues in 2019-2023
Main business revenue overseas(RMB in 1 million)Ratio ofoverseas business revenueto total revenue
20192020202120222023
15.91%
19.79%
16.17%
16.68%
1,894.762,660.472,571.582,841.96
15.52%
2,583.65
Internationalisation is the long-term strategy of Joincare’s development. In September 2022, Joincare successfullylisteditsGlobalDepositoryReceipt(GDR)ontheSIXSwissExchange,becomingtherstdomesticbiopharmaceuticalcompany to issue and successfully list the GDR in Switzerland. The speed of the Group’s internationalisation thathighlights both “bringing in” and “going global” will be further increased by launching the GDR. At present, weareworkingtoseektheopportunitiestoexpandtheintroduction,investmentandM&Aofoverseashigh-qualitypharmaceutical products and pipelines. As part of our “bringing in” strategy, we are focusing on expanding new targets,mechanisms, and methods of administration and indications in key treatment fields, including respiratory diseases,gastroenterology, psychiatric disorders, and assisted reproduction. This can not only enhance the Group’s strength inR&D pipeline, but also support our strategic development over the next 3-5 years and beyond.To facilitate “going global”, we pay close attention to the policies and opportunities for innovative development in thecapital market, and actively use the capital market to support our strategic development and business layout. We carriedout a number of on-site investor communication activities in Singapore, the United Arab Emirates, Switzerland and otheroverseas countries. During these activities, we elaborated on the Group’s dual-drive strategy of “Innovative Medicinesand High-Barrier Complex Formulations”, international layout and key products to overseas institutional investors.Thesee?ortsfurtherboostedtheGroup’sinternationalpresence,layingafoundationforthesubsequentdevelopmentofoverseas markets and channels.We proceeded with the work of admittance, product registration, and promotion for products such as inhalationformulations, assisted reproduction, gastroenterology, and anti-infection overseas. Ilaprazole Sodium for Injectionand Ilaprazole Enteric-Coated Tablets, which are our major products, are granted for sale in the Indonesian market.Compound Ipratropium Bromide Solution for Inhalation is approved for drug registration in the Philippines.Levosalbutamol Hydrochloride Nebuliser Solution and Budesonide Suspension for Inhalation are registered in Macao,and are being registered in countries like the Philippines. The application for registration of Cetrorelix Acetate Powderfor Injection has been submitted in the United States. Meanwhile, we promote international cooperation and externallicensing and authorisation of innovative products and pipelines, and we conduct discussions on cooperation withinternationalmulti-parties.Amongthem,wearediscussingexternalauthorisationofthemodiednewdrugsTobramycinInhalation Solution with customers in European and Southeast Asia.To promote the industry chain integration, the Group leverages the strategic advantage of “APIs-preparations verticalintegration” to globalise and integrate the core supply chain while expanding the business map. We acceleratethe development of overseas API business, and step up efforts to develop the market for high-end antibiotic APIs.We strengthen cooperation with local preparation producers, and constantly advance the registration of APIs andintermediates in emerging markets and developing countries. With these efforts, we aim to further enhance the globalavailabilityoftheGroup’shigh-qualityproductsandservices.
In January 2024, Compound Ipratropium Bromide Solution for Inhalation, independently developedby Joincare, successfully obtained the drug registration certificate approved and issued by thePhilippines Food and Drug Administration. This marked that the Group was eligible for the salesof this product as a drug in the Philippine market. Compound Ipratropium Bromide Solution forInhalation is applicable to the patients jointly applying a variety of bronchodilators and is thecommonly used drug for the patients with asthma and chronic obstructive pulmonary disease.ApprovedformarketinginChinainApril2019,itistherstatomisationinhalationsolutioninChinato be approved for new Class 4 registration. Its overseas listing positively promotes the marketing ofthe Group’s inhalation formulations in the overseas market, and further enhances the availability ofhigh-end inhalation formulations in the overseas developing countries.
Improving the availability of inhalation formulations - Joincare’s CompoundIpratropium Bromide Solution for Inhalation was launched in the Philippines
Case
Corporate Social Responsibility Report 2023
Recombinant Human Choriogonadotropin alfa for Injection (“丽得宝?”), an assisted reproductiondrug developed by LivzonBio, was approved for marketing in China in 2021. Due to its high safetyand affordable price, Livzon Group, Joincare’s holding subsidiary, is working on its overseasregistration.Besides,itisalsoseekingoverseascooperation,inanendeavourtobenetmoreinfertilepeople all over the world and provide more economical products for overseas patients.By the end of the reporting period, the registration information had been submitted for RecombinantHuman Choriogonadotropin alfa for Injection in Uzbekistan, Pakistan, the Philippines and Nigeria,and we had obtained the approval for NDA issued by Badan Pengawas Obat dan Makanan (BPOM),aPIC/Smembercountry.Thesee?ortshaveenabledustomakeasuccessfulentryintoIndonesia,thelargest market in Southeast Asia. The approval of Recombinant Human Choriogonadotropin alfa forInjectionformarketinginIndonesiacanbenetabout4millionlocalinfertilepeople,andhelpLivzonGroup accelerate its registration process in more PIC/S member countries in Southeast Asia and otherregions, thereby benefiting more overseas patients. Moreover, Livzon Group signed a Memorandumof Understanding on strategic cooperation and localised production cooperation of biologics withthe leading enterprise of reproductive products in Bangladesh, with the intention of introducingRecombinant Human Choriogonadotropin alfa for Injection into Bangladesh. This was followed by astrategic localised production cooperation. If all goes well, Recombinant Human Choriogonadotropinalfa for Injection will be available in Bangladesh in the future, and more than 3 million local patientsin need of assisted reproduction will have better treatment options.
Livzon Group, Joincare’s holding subsidiary, accelerated the overseas business of TCM preparations,and successfully obtained the EAC Certificate of State Registration for Jingfu Zhiyang Keli issuedby the Russian authorities in December 2023. With the functions of dispelling wind, eliminatingdampness, clearing heat, removing toxicity, and arresting itching, Jingfu Zhiyang Keli is used to treatwind-heatanddamp-heattypepapularurticariainchildren.ItistheLivzonGroup’srstTCMproductapproved in Eurasian Economic Union countries. In the future, this product will be able to circulateand be sold freely within the customs territories of five Eurasian Economic Union member countries(Russia, Kazakhstan, Belarus, Kyrgyzstan and Armenia), benefiting approximately 5.5 millionpatients.
Expanding the biologics business - Livzon Group’s Recombinant HumanChoriogonadotropin alfa for Injection entered the Southeast Asian market
Speeding up the internationalisation of TCM - Livzon Group’s Jingfu Zhiyang KeliobtainedtheEACCerticateofStateRegistration
Case
6.4 Improving Product A?ordability
The cost of medicines accounts for the majority of the medication-related financial burden. Joincare is committedto alleviating the financial burden on patients by adopting inter-country and intra-country tiered pricing based ona?ordability,aimingtoprovidehigh-qualitymedicinestomorepatientsata?ordableprices.Domestic Market
The Group actively responds to admission to the medical insurance list. In 2023, in the new version of the NationalMedicine List for Basic Medical Insurance, Work Injury Insurance and Maternity Insurance (“National ReimbursementDrug List”) published by the National Healthcare Security Administration, Joincare had 210 products included, amongwhich 95 were Class A and 115 were Class B. In addition, Joincare has been keeping track of the national centraliseddrug procurement, striving to be included in the national procurement list. This year, we participated in the eighth andninth batches of national centralised medicine procurement organised by the China National Joint Drug ProcurementOffice. Among them, two products of Joincare’s holding subsidiary Livzon Group, won the bid for the eighth batch ofnational procurement, and one product of Joincare won the bid for the ninth batch. This allows more patients to accessfairly-pricedandhigh-qualitymedicinesinthefuture.
Key Products in National Reimbursement Drug List
Medical InsurancePayment StandardTobramycin Inhalation Solution (“健可妥?”):Asamodiedinnovativemedicinedevelopedindependently by Joincare,健可妥? is the only approved inhalation formulation in the worldfor the treatment of bronchiectasis accompanied with pseudomonas aeruginosa infection.It was approved for marketing in October 2022, breaking the dilemma that no atomisedantibiotics are available for patients with bronchiectasis in China. As a key item under theNational Key New Drug Creation Programme,健可妥?o?ersthebenetsoflow-doselocaladministration, high concentration, non-ototoxicity and non-nephrotoxicity, and low medicineresistance. It is safer for both childhood and elderly patients and represents a significantbreakthroughintheeldofrespiratorysystemdiseases.
RMB 253.60(5ml:300mg/piece）
Ilaprazole Sodium for Injection (“壹丽安?”):
壹丽安?, a patented new drug of Joincare’sholding subsidiary Livzon Group, was incorporated into the NRDL in 2019. This year,壹丽安? was once again included in the NRDL as a drug used for patients with peptic ulcer,and it also received approval for a new indication "prevention of severe stress-induced ulcerbleeding". The medical insurance payment for this drug was reduced from RMB 71/piece toRMB 63/piece, which expands the application range of the product, meets clinical needs, andfurther alleviates the economic burden on patients.
RMB 63.00
(10mg/piece)
Triptorelin Acetate Microspheres for Injection (“维宝宁?”): It is a modified new drugdeveloped by Livzon Microsphere, a subsidiary of Joincare and was approved for marketingin May 2023. It is indicated for the treatment of locally advanced or metastatic prostate cancer.Compared with the Triptorelin Acetate Injection,维宝宁?o?erssignicantadvantagessuchasalongerdurationofactionandfewerdosesrequired.ThemedicalinsurancepaymentisRMB 1,000 per bottle, representing a price reduction of approximately 20% compared to theimported formulations already on the market.
RMB 1,000.00(3.75mg/bottle)
Corporate Social Responsibility Report 2023
Products Selected in the 8th Batch of Volume-based ProcurementPriceVoriconazole for Injection (“丽福康?”): As a product of Joincare’s holding subsidiary LivzonGroup, it is a broad-spectrum triazole antifungal medicine used to treat progressive and life-threatening fungal infections. It can also be used to prevent invasive fungal infections in high-risk patients undergoing allogeneic hematopoietic stem cell transplantation. In recent years,Voriconazole has become the preferred treatment for invasive fungal infections due to itsbroad-spectrumantifungalactionandpositivee?ects.
RMB 291.90(0.2g*10 bottles/box)Cefodizime Sodium for Injection (“康丽能?”):
康丽能? is a product of Joincare’sholding subsidiary Livzon Group. It is a third-generation broad-spectrumcephalosporins and passed the consistency evaluation in July 2022. This medicinepossesses broad-spectrum antifungal actions to treat infections caused by sensitiveorganism, including upper and lower urinary tract infections, lower respiratory tractinfections, and gonorrhea.
RMB 28.90(0.5g*10 bottles/box)Products Selected in the 9th Batch of Volume-based ProcurementPriceLevosalbutamol Hydrochloride Nebuliser Solution (“丽舒同?”): As a key product ofJoincare, it was a typical complex formulation and entered the Announcement on Applicationfor Registration of Drugs to be Included in the Priority Review Procedure (29th Batch) becauseof the advantages for priority review, such as “Major Special Project” and “Children's Drugs”in 2018. In 2019, it was approved for marketing as the first new class-III levosalbutamolformulation in China and included in the NRDL in 2020. It can reduce the risk of adversereactions such as tachycardia and hypokalemia compared with salbutamol, a commonly usedfirst aid for asthma and chronic obstructive pulmonary disease (COPD), and can greatlyimprove patients’ pulmonary function, thereby lowering the risks of them having to behospitalised and re-hospitalised, or shortening hospital stays. Therefore, this medicine is a safeandmoree?ectivetreatmentoptionforpatients.
RMB 1.65(3ml: 0.63mg/piece)
Overseas MarketWhen entering overseas markets, Joincare comprehensively considers the local economy, healthcare level, and pricebenchmarkingtoofferequitablepricinginlinewiththecurrentregionaldevelopment,avoidinganincreaseinthefinancialburdenofpatients.Afteranadequateassessmentoflocalpercapitaincomeandanalysisoflocalpatients'affordability, differential and tiered pricing strategies are implemented for different markets. Joincare also positivelygoesforthebiddingoflocalgovernmentsduringproductpromotionindevelopingcountriesoverseassothata?ordablemedicines and services would be offered locally. By the end of the reporting period, the Group and its subsidiaries hadadoptedequitablepricingpoliciesfor27productsinSouthAsia,SoutheasternAsia,SouthAmericaandAfricatomatchthe local income level.Takingintoaccountthea?ordability,Joincare’sholdingsubsidiaryLivzonGroupalsoadoptsequitablepricingpolicies,in a bid to promote pricing transparency in both developed and emerging markets. For formulations, Livzon Groupstrictly adheres to the local government's pharmaceutical pricing policies in developing countries. The generic drugs areusually priced at 60-70% of the price of the original drugs. For APIs, Livzon Group reduces intermediary channels byselling APIs directly to the end formulation factories. This approach enables accurate knowledge of the purchasing pricesof end customers, thereby enhancing pricing transparency and reducing local pharmaceutical supply costs.
Joincare Pharmaceutical Group Industry Co., Ltd. Table: Livzon Group’s pricing policies and implementation
BusinessPricing policiesPricing
APIs
?Considering higher drug costs coveredby patients in emerging markets/developing countries, Livzon Groupprovidesthesemarketswithhigh-qualityAPIs and intermediates at prices lowerthan those in developed countries, aimingto reduce drug costs for patients in thetarget countries.?When promoting products in emergingmarkets/developing countries, LivzonGroup sets prices in alignment with thelocal living and medical levels.?LivzonGroupalsoupholdsequitablepricing at home. Livzon Group signsan annual supply agreement withdomestic strategic partners, and providesconcessions based on the purchasevolume.
?Livzon Group has established the commercialcooperation with over 50 customers in India for thesupply of 20 APIs and intermediates. The pricing forintermediates is about 5%-10% lower than that indeveloped countries, and the pricing for APIs is about15%-30% lower than that in developed countries.?Some high-end antibiotics (such as VancomycinHydrochloride, Teicoplanin and Dattomycin) are ingreat demand in emerging markets and developingcountries. The average selling price for such productsin developing countries from South America,Southeast Asia, and Africa is about 10%-15% lowerthan that in developed countries.?The average selling price of some veterinary drugs(such as Doramectin and Moxidectin) in major SouthAmerican countries (such as Colombia, Brazil,Uruguay and Argentina) and some Asian countries(such as Pakistan and Vietnam) is about 15%-20%lower than that in developed countries.
Formulations
?By supplying chemical generic drugsor biosimilar drugs, Livzon Group sellsformulations with lower prices andsimilar efficacy to the Asian, African andLatin American markets.?In emerging markets/developingcountries, Livzon Group adopts a suitablepricing structure to formulate reasonableprice based on local development level.?In underdeveloped and low-incomecountries, Livzon Group exemptslicensing fees.
?For Recombinant Human Choriogonadotropin alfafor Injection, Livzon Group waives licensing fees forits partners in 4 countries in West Africa, South Asiaand Southeast Asia.?For Ilaprazole Sodium for Injection, a patented newdrug, Livzon Group waives licensing fees for itspartners in 2 countries in Southeast Asia and 1 countryin Africa.?For Recombinant Human Choriogonadotropin alfafor Injection, Ilaprazole Sodium for Injection, andUrofollitropin for Injection, Livzon Group reducestheminimumpurchaserequirementsforpartnersindeveloping countries.
Reagents
?By probing the final selling priceof reagents, Livzon Group prohibitsdistributors by relying on franchise tolimits their mark-up on the final sellingprice.?In underdeveloped and low-incomecountries, Livzon Group provides morefavourable prices.
?Livzon Group approaches multiple transport serviceprovidersfortheoptimumfreightquotation,inabidtoprovidecustomerswithcost-e?ectivedelivery.
Corporate Social Responsibility Report 2023
Joincare focuses on respiratory diseases. We build a popular science new media platform matrix called “RespiratoryExperts’ Views”. Through new media channels such as WeChat official account, Douyin, and Weibo, we promoteknowledge on chronic respiratory disease and give treatment support.?During the “World Asthma Day” 2023 activities, the “Respiratory Experts’ Views” platform continued its “Asmall red envelope for you” activity, collaborating with 436 grade-A tertiary hospitals nationwide to conduct publiceducation activities on asthma. Additionally, it launched a week-long series of live broadcasts focusing on asthmaknowledge. With a close focus on the "World Asthma Day" theme of "Asthma Care for All", we partnered withasthma experts to spread knowledge of asthma prevention and treatment to the public, aiming to promote a correctunderstandingofasthmaande?ectivediseasemanagement.?In recent years, the incidence and prevalence of bronchiectasis have increased in the world, with poor patientcomplianceleadingtosignicantburdensonthesocietyandfamilies.Toraiseglobalawarenessofbronchiectasis,1 July 2022 was designated as the first "World Bronchiectasis Day". During the second "World BronchiectasisDay" in 2023, the "Respiratory Experts' Views" platform collaborated with the China Bronchiectasis Registryand Research Collaboration (BE-China) to launch a public welfare and educational campaign on bronchiectasis.Through online and offline approaches, it aimed to encourage patients to effectively manage the disease, therebyimprovingtheirqualityoflife.?During the “World COPD Day” activity in 2023, the "Respiratory Experts’ Views" platform joined forces with329 grade-A tertiary hospitals nationwide to conduct public welfare educational activities for COPD. Additionally,it collaborated with local media to promote and expand coverage of the campaign, calling on the public to keep ahealthylungandpromoteearlypreventionande?ectiveinterventionforbettertreatmente?ect.By the end of the reporting period, the “Respiratory Experts’ Views” platform had assembled over 5,000 respiratoryexperts, hosted over 500 educational live broadcasts on respiratory diseases, with over 1,000 experts participatingand over 25 million views, and attracted over 5 million followers.
“Respiratory Experts’ Views” public welfare activities series
6.5 Improving Healthcare
In recent years, the global population has been increasing, leading to a growing demand for medical services. Theissues of uneven distribution of medical resources and imbalanced development of medical technology have becomeincreasingly prominent. As a result, many patients in developing countries still lack access to timely, effective, andaffordable healthcare. Joincare adheres to the corporate mission of "For the health, For the future," and fully leveragesour own strengths to continuously popularise knowledge of chronic diseases and eliminate the indiscrimination use ofantibiotics. We also actively involve in capacity advancement initiatives in developing countries and contribute to globalhealth development.
6.5.1 Popularising Knowledge of Chronic Disease
Respiratory disease is China's third most common chronic disease after cardiovascular disease and diabetes, with morethan 160 million patients suffering from asthma, chronic obstructive pulmonary disease (COPD) and bronchiectasis.Recently, the incidence of asthma, COPD and other respiratory diseases in China have kept rising. According to thestatistics, China has nearly 45.7 million adult and 15 million childhood patients with asthma and 100 million patientswith COPD. However, the awareness rate of COPD is way below the target set by the Healthy China initiative 2019-2030. To increase public awareness of chronic respiratory diseases, with measures such as organising online live-broadcasting via new media, publishing academic papers, supporting academic research, and holding and participatingin offline academic promotion activities, Joincare endeavours in many ways to educate the public about asthma, COPDand other chronic respiratory diseases and encourages people potentially suffering from these diseases to take regularpulmonary function tests, to help prevent and treat chronic respiratory diseases.
Case
Bronchiectasis, one of common chronic respiratory diseases in China, can be aggravated by PA. Thefrequentandacuteattackofbronchiectasisduetothebacteriumwillincreasetheriskofhospitalisation.For initially isolated PA, approximately 50% of patients can achieve continuous negative sputum culturewithin one year through eradication therapy based on inhaled antibiotics. However, once PA becomeschronically colonised, the eradication becomes a challenge. Timely and standardised eradication therapymay improve the prognosis of patients with initial or new PA infections, but there is limited high-levelevidence to support this. Therefore, it is considered in the industry that eradication therapy for initial ornew PA infections has become the primary focus of current research in bronchiectasis.Before the introduction of健可妥? to the market, bronchiectasis patients in China had not undergonelong-term inhaled antimicrobial therapy, making them an ideal population to explore the efficacy andsafety of eradication therapy. Therefore, Professor Xu Jinfu from the Shanghai Pulmonary Hospitalaffiliated to Tongji University initiated a study titled "The Efficacy and Safety of Inhaled TobramycinSolution for Eradicating Pseudomonas Aeruginosa in Adult Bronchiectasis Patients” with the support ofBE-China. Sponsored by Joincare, this research is currently recruiting participants. The research aimsto explore the superior efficacy of Tobramycin Inhalation Solution, either alone or in combination withCiprofloxacin Hydrochloride Tablets, compared with inhalation of physiological saline, in eradicatingPAforearly-stageinfectedadultpatients.Theprimarye?cacyindicatoroftheresearchistheproportionof subjects with continuous negative PA sputum culture following the initiation of treatment (negativesputum culture at weeks 24 and 36). Secondary efficacy indicators include patient acute exacerbations,lungfunction,hospitalisations,andqualityoflife.Safetyindicatorsincludetheincidenceofadverseevents and the proportion of subjects developing resistance to Tobramycin and CiprofloxacinHydrochloride after enrolment.
Studyonthee?cacyandsafetyofTobramycinInhalationSolution
6.5.2 Addressing Antibiotic Resistance
The Group acknowledged that antibiotic resistance has become a global public health risk theme, threatening humanhealth. In strict accordance with the Management Policy for Clinical Use of Antimicrobial Medicines, Joincare greatlyemphasises the clinical use of antibiotics and strengthens the management of its anti-infection product portfolio,including Meropenem for Injection, Voriconazole for Injection and Cefodizime Sodium for Injection. Based on theclassification of antibiotics for clinical use, we actively cooperate with medical institutions to handle antibiotic abuse,enforce the principles of “non-limited use”, “limited use”, and “special use”, and promote the management of physicians’prescription rights and control of medicine-resistance bacteria. Training lessons and lectures on optimising medicine-resistance bacteria treatment schemes are given to improve the clinical efficacy of antibiotics and effectively preventmisuse.In terms of R&D to address antibiotic resistance, the Group focuses on the resistance risk of Tobramycin InhalationSolution and drug resistance of pseudomonas aeruginosa (PA). PA infection is difficult to control in the acute stage anddifficulttoclearinthestablestage.Thedrugresistanceratesofcommonlyusedanti-PAdrugs(e.g.,fluoroquinolones,carbapenems, penicillins) are more than 10%. In contrast, the resistance index of Tobramycin Inhalation Solution inphase III clinical trial showed a low risk of resistance. In two clinical studies, treatment with Tobramycin InhalationSolution for 6 months had little effect on the susceptibility of most PA strains tested, effectively reducing the incidenceof antibiotic resistance. Also, Joincare’s holding subsidiary Livzon Group keeps on conducting R&D to address drugresistance of Gram-Negative Bacteria and Fungi and works with stakeholders to develop solutions to antibiotic resistance.Moreover, Joincare takes an active part in a number of academic conferences and has in-depth exchanges with clinicalexperts in infection, respiratory, blood, ICU, organ transplantation, skin, obstetrics, and gynaecology and scholarsengagedinbasicresearchofmicrobiology.Throughthesee?orts,weaimtopromotedevelopmentandinnovationintheeldofmedicinetoensurethatallpeoplecanliveahealthylife.
Case
Corporate Social Responsibility Report 2023
Study on Drug Resistance of Gram-Negative Bacteria (GNB)At present, GNB is highly resistant to antibiotics. According to the study, all top five clinical straininfections in China are GNB infections. Polymyxin, one of the most important drugs in the treatmentofmultidrug-resistant(MDR)GNBinfections,ise?ectiveagainstvariousGNBincludingEscherichiacoli thanks to its low resistance rate and strong antibacterial activity. It is called the last line ofdefenceforMDRGNBinfections,againstwhichantibioticssuchasβ-lactams,aminoglycosidesandquinolonesareine?ective.The Livzon Group is developing polymyxin products. Our API, polymyxin E sodiummethanesulfonate, has obtained the European CEP and passed the FDA review. It is under the domesticapplication for marketing and the review of registration at present. In addition, Livzon Group isworking out the formula of polymyxin preparations to facilitate the marketing.Study on Drug Resistance of FungiIn recent years, as more people are infected with immunodeficiency virus or undergo tumourchemotherapy, invasive fungal infections has gradually increased. At present, three main types ofantifungal drugs are available on the market: polyene, azole and echinocandin. After years of clinicaluse, high level of antifungal resistance is shown, severely limiting treatment options.Livzon Group is developing a new class 1 drug with a brand-new mechanism of action and targets- fungi-specific enzymes. The targets have low homology with human body, leading to good safetypotential. The new mechanism of action is expected to tackle antifungal resistance. By the end of thereportingperiod,LivzonGrouphadconrmedtheleadcompoundswhichareunderoptimisation.
Livzon Group’s study on tackling antimicrobial drug resistanceCase
6.5.3 Involvement in Capacity Advancement Initiatives
Joincare is deeply committed to the development of healthcare in developing countries. In line with our internationalstrategies, we are actively involved in capacity advancement initiatives for healthcare in developing countries and workcloselywithlocalpartnerstocollectivelyimprovingthequalityandcapacityofhealthservicesinthoseregions.Training of local healthcare workers
While expanding our formulation business in developing countries, the Group actively provides training for localhealthcare workers to improve local medical service standards. While we exported Meropenem for Injection todeveloping countries such as the Philippines, Ukraine, Vietnam, Pakistan, Peru, and Chile, we provided registration andpromotion training for local contacts and assisted our partners in conducting product usage and related training for localhealthcare workers. In addition, Joincare’s holding subsidiary Livzon Group is conducting training for the healthcareworkers and key researchers of the overseas Phase III clinical trials of丽康? in the Philippines, Pakistan, Malaysia andothercountries,coveringtherelevantregulationsofvaccineregistration,remotevericationprocess,vericationpointsand experience sharing, etc., to help local healthcare workers standardise clinical research operations according to theGCP guideline. Also, Livzon Group is actively engaged in overseas academic promotion and training activities. LivzonGroup provides detailed product usage instructions and shares clinical experience with healthcare workers in developingcountries,soastoensurethesafeande?ectiveuseofourproductsforlocalpatients.
Since the launch of the innovative medicine Ilaprazole Sodium for Injection in Indonesia in2023, Livzon Group has collaborated with local partners to conduct a total of 8 academicpromotion activities in Indonesia. This includes organising 4 large-scale professional academicseminars held by the Indonesian Society of Internal Medicine and Indonesian Society ofGastroenterology. On 11 November 2023, Livzon Group and its Indonesian partners participatedin the annual conference of internal medicine held in Bali, Indonesia. The conference attractedapproximately 300 experts from various regions of Indonesia. During the conference, LivzonGroup and its partners invited a prominent gastrointestinal disease expert in Indonesia to presentthe clinical advantages of Ilaprazole for Injection as a new generation PPI in the treatment ofgastrointestinal bleeding. The expert also elaborated on the product usage and precautions,which received positive and favourable feedback from other experts in Indonesia. In the productpromotion phase, local Indonesian experts will lead in-depth training for healthcare workers atlocal hospitals.
Livzon Group launched its assisted reproductive products, Urofollitropin for Injection andMenotropins for Injection, in Uzbekistan in 2022 and were academically promoted at the localreproductive conference. This year, Livzon Group invited Chinese doctors with rich clinicalexperience and local experts in the field of reproductive medicine in Uzbekistan to engage in onlineacademic communication with 8 doctors from 3 leading reproductive centres invited by local partners.Thepurposewastoexchangeandsharetheusage,e?cacy,andclinicalexperienceofLivzonGroup'sreproductiveproducts,providingacademicsupportforthesafeande?ectiveuseoftheproducts.
Livzon Group provides academic promotion regarding innovative medicines forhealthcare workers in Indonesia
Livzon Group provides academic training for healthcare workers in Uzbekistan
Case
Corporate Social Responsibility Report 2023Assistance to local manufacturers to boost their capacity and competencyAs an APIs supplier, Joincare, together with its holding subsidiary Livzon Pharmaceutical Group, shares its researchresults with less developed countries and regions overseas and proceeds technology transfer. We improve productionability of local formulation manufacturers to ensure that they can match applicable international drug manufacturingstandards. In addition, Livzon Group helps local pharmaceutical enterprises to improve and optimise productionproceduresandqualitycontrolroutinebyprovidingtechnologytransferandanalysisanddetectionscheme.Therefore,the level of local production technology is increased.
The Indian market stands as one of the largest global market for cephalosporins, and Joincare is theprimary supplier of the starting materials 7-ACA and D-7ACA for cephalosporin APIs in the Indianmarket. 7-ACA was previously used extensively as an intermediate for cephalosporin APIs in theIndian market. Since 2013, Joincare has conducted multiple regular visits each year and activelypromoted the conversion of the starting materials for Cefuroxime Axetil and Cefpodoxime ProxetilAPIs from 7-ACA to D-7ACA for the cephalosporin API manufacturers in India. This initiative has notonly reduced the production processes and periods for cephalosporin API manufacturers in India, butalsoreducedqualitycontrolrisksandloweredproductioncosts.Atpresent,thedemandforD-7ACAintheIndianmarketsignicantlyexceedsthatof7-ACA.Thereductioninproductcostshasbenetedthe entire Indian market and decreased medicine costs for local patients.
Any materials that effect drug purity are called impurity. The research on impurity is an importantpart in drug R&D. The control of impurities in drugs relate directly to the controllability and safety ofdrugquality.ByrelyingonitsabilityofR&Dandqualityanalysis,LivzonGroupdevelopeditsownimpurity detection method, and it gives the method to generic drug pharmaceutical enterprises wholack of technology in new emerging markets and developing countries for free. Providing impuritystandardbreaksbarriersofimpuritycontrolanduniquetechniquesfordetectionsetbyEuropeanandAmerican suppliers or original drug developers. In 2023, Livzon Group independently developed animpurity detection method for Daptomycin and supported customers in utilising and registering theproduct in certain markets, ensuring the smooth commercialisation of the product.
Joincare facilitates process optimisation for API manufacturers in India
Livzon Group offers free transfer of impurity detection method to producers fromdeveloping countries
Case
Sticking to the value proposition of “Putting people first”, Joincare always regards people as the core driver of sustainabledevelopment.Wealwaysinsistondevelopingemployerbrandingbyconstantlyoptimisingqualityandlevelofhumanresourcemanagement.Weattractandgathertalentswithanequalandinclusiveattitude,andwerespecttheirlegitimateinterest.Withcompliant employment, multilevel training, and comprehensive compensation and welfare, we provide a wide and fair careerdevelopment path for employees to stimulate organisational vitality constantly. We pay great attention to the occupational healthandwellbeingofouremployeesbyoptimisingtheworkingenvironmentando?cefacilitiestocontinuouslyimprovetheirsenseof happiness and belonging. Therefore, we grow together with our employees.
SDGs in this section
Talent
Management
Corporate Social Responsibility Report 2023
7.1 Protection of Rights and Interests of Employees
TheGroupalwaysregardshigh-qualitytalentsasthecorestrengthforcorporatedevelopment.Committedtosafeguarding the legitimate rights and interests of employees, we improve the employment management and eliminateanyformofprejudice,discriminationorharassmenttocreateaninclusiveworkplacewithdiversityandequity.Bytheend of the reporting period, Joincare has 14,365 employees in total.
7.1.1 Employment Compliance
Complying with the Labour Law of the PRC, the Labour Contract Law of the PRC, the Provisions on the Prohibitionof Child Labour and other laws and regulations, Joincare has formulated the Code of Labor Employment and EthicalConduct (the “Code of Employment” or the “Code”). The Code of Employment has specified the employmentmanagement covering all employees (including full-time, part-time and temporary employees) of the Group and itssubsidiaries, as well as all suppliers, contractors, service providers, customers and other partners in collaboration withthe Group. Sticking to zero tolerance for any form of discrimination, we have defined escalation process for reportingincidents as well as disciplinary and corrective actions in case of discriminatory behaviour or harassment in the Code ofEmployment (see Article 8-10 summarised below). During the year, there were no discrimination or harassment incidentsat Joincare.In addition, we keep improving policies such as the Human Resources Management Regulations, the TrainingManagement System, the Attendance Management System, and the Employee Handbook. We sign contracts withemployees under the principle of free will to specify their rights and obligations.
1.The Code are applicable to all employees of Joincare, including full-time employees, part-time employees and
temporary employees, as well as all clients, suppliers, service providers, contractors and other partners conductingbusiness with Joincare.
2.The Company prohibits the use of child labour. All units are forbidden to recruit and employ minors under the
age of sixteen.
3.The Company is against forced labour. No unit shall force employees to labour by means of violence, threats or
illegal restrictions on personal freedom.
4.The Company respects our employees’ freedom of association. Employees have the right to freely choose to
formorjoinaunion.ThelabourunionhastherighttobargainwithJoincareonanequalfootingwithJoincareonbehalf of employees and enter into collective contracts in accordance with the law.
5.We strive to create a physically and mentally healthy working environment for employees. We guarantee the
laboursafetyandhealthprotectionofemployeesintheworkplaceinaccordancewiththerequirementsofnationalregulations, and support the continuous improvement of the working environment. All employees are responsiblefor reporting potential unsafe factors in the workplace.
6.Wevaluethedevelopmentandimprovementofouremployees'talents.Whendecidingonlaboura?airssuchas
compensation, benefits, training opportunities, promotion, demotion, assignment, transfer, development, tuitionassistanceorretirement,wewillmakedecisionsbasedontheircapabilities,performanceandworkrequirements,without being influenced by factors such as age, ethnicity, race, family status, ethnic background, skin colour,gender, sexual orientation, religious belief, social origin, nationality, disability, pregnancy, etc., and strive toeliminate all forms of bias and discrimination.
7.We strictly prohibit any form of harassment in the workplace, including sexual harassment and other non-sexual
harassment against the will of others by means of oral language, written texts, images, physical behaviour, etc.We encourage employees who are victims of harassment to immediately report the situation to their superiors orthe human resource department for the Company to investigate. We will investigate such reports confidentiallyas promptly as possible. Once the investigation is sufficient to substantiate relevant allegations, we will takeappropriate corrective actions.
8.We have incorporated the principles and concepts of diversity, anti-discrimination, non-prejudice and anti-
harassmentintoouremployeetraining,andrequireallemployeesofJoincaretoparticipateinsuchtraininganddeeply understand the above principles and provisions of related rules.
9.We give our best effort to identify behaviours that do not comply with the provisions of the Code, and commit
to make every effort to prevent such behaviours from occurring. To this end, we encourage Relevant Persons toreport violations of the Code to their superiors or the human resource department as promptly as possible so thatthe Company can investigate and tackle them to reduce the occurrence of such violations in the future.
10.We will investigate the violations of the Code as promptly as possible and take necessary measures to
protect the legitimate rights and interests of Relevant Persons who report and complain in good faith; those whodeliberately fabricate facts and make false charges or frame-ups under the pretext of reporting or complainingwill be dealt with seriously in accordance with relevant regulations, and shall be transferred to judicial organs forhandling, if the action constitutes a crime.
11.Once the investigation is sufficient to prove that there is a violation of the Code, we will impose appropriate
penalties and take corrective measures, including but not limited to the termination of labour contracts andcommercial contracts. Those whose actions are suspected of constituting a crime shall be transferred to judicialorgans for handling.
The Code of Employment of Joincare is summarised as follows:
Corporate Social Responsibility Report 2023
7.1.2 Human Rights Protection
To better fulfil our commitment to human rights, Joincare has developed and published on the official website the Codeof Employment, a company-specific and company-wide human rights policy covering the practices set out in the ILOcore conventions and the Universal Declaration of Human Rights of the United Nations. This Code has specified suchprovisions on protecting human rights as the prohibition on forced and child labour, anti-discrimination, anti-harassment,equalremuneration,freedomofassociation,therighttocollectivebargaining,andoccupationalsafetyandhealth(see Article 2-7 summarised above). This Code applies to all employees, including full-time, part-time and temporaryemployees, as well as all customers, suppliers, service providers, contractors and other partners in collaboration with theGroup.Inadditiontopolicyrequirements,wehavetakenaseriesofactionstomitigateandremediatehumanrightsrisks.Westrengthen education and training on protecting human rights in our daily work. We strictly review the implementation ofhuman right policies, identify potential risks through due diligence process, and take improvement actions to proactivelyprevent potential human rights risks. All employees and relevant personnel of the Group can report potential human rightrisks via the hotline published on the official website. Those in violation of the provisions on protecting human rightswill be investigated immediately. We will also take the necessary actions to protect the legitimate rights and interestsof the reporter. Once verified, those who violate the Code of Employment will be punished appropriately, including butnot limited to the termination of labour contracts and business contracts. Those whose acts are suspected of constitutingcrimes will be transferred to judiciary authorities for handling.
Joincare’s holding subsidiary Livzon Group has established systematic Human Rights Due DiligenceProcess, including human rights risk identification, annual audit and report, and formulation andimplementation of mitigation and remediation actions. Covering its own operations and business-related activities, Livzon Group’s Due Diligence includes human right protection terms in theCodeofEmployment,suchasprohibitiononforcedandchildlabour,equalremuneration,andanti-discrimination. This year, based on the results of the Due Diligence, Livzon Group’s human rightsrisksmainlyarosefromworkingenvironment,compensationandbenets,andconictofinterests.Foreach risk identified, Livzon Group developed and taken effective mitigation and remediation actionswhich have been implemented by its subsidiaries and overseen by its ESG Committee. By the end ofthe reporting period, one subsidiary under the Livzon Group had implemented mitigation plans.
Livzon Group conducts Human Rights Due Diligence
7.1.3 Diversity and Inclusion
Joincareadvocatesadiverse,equalandinclusivecorporateculturetoattractandpooloutstandingtalents,andencouragesemployees with different backgrounds to give play to their talents. We have formulated and implemented the Diversity,EquityandInclusionPolicy,specifyingthattheSocialResponsibilityCommitteeoftheBoardisresponsibleforreviewing the policy, and overseeing diversity performance and progress for target of the Group. All employees arerequiredtocompletethetrainingontheDiversity,EquityandInclusionPolicyandothercoursesregardingdiversity,equityandinclusiontocultivateawarenessintheseregardsandcreateadiverseandunbiasedworkingenvironment.Inaddition,wetreatemployeesequally,andofferrightsandbenefitsinallaspectsofhumanresourcesmanagement,such as hiring, promotion and compensation, to all employees regardless of their gender, age, ethnicity and nationality.Meanwhile, we keep on improving the management rules regarding diversity in the Compilation of the Human ResourcesManagement System. We also carry out compliance audits on human resources management.
Case
Basedonbusinessdevelopmentrequirements,theGrouphassetaquantiablediversitygoalof“nolessthan49%femaleemployees by 2032”. The Group also strengthens the collection, statistics and disclosure of diversity indicators ensurethe orderly progress of diversity-related initiatives. By the end of the reporting period, the Group had 6,577 femaleemployees, accounting for 45.8% of the total employees, with female management of 35.4%.
In 2023, Livzon Group, Joincare’s holding subsidiary, conducted online and offline diversity trainingforallemployees,includingthecontentsandmechanism,identicationandimpacts,management,aswell as exploration and actions in this regard. Through the training, employees were able to understandand respect different cultures, backgrounds and views to eliminate prejudices in life and work. Inaddition, teamwork and multicultural exchanges were also encouraged to promote the diversity. Theemployee satisfaction rate of this diversity training reached 93.8%.
Livzon Group conducts diversity training for employees
In terms of material benefits to facilitate diversity, in addition to marriage, maternity, breastfeeding and other leavesstipulated by the national law, we provide generous gift packages to female employees during their childbearing period.This year, we provided special care for female employees, that is, customised physical examination services. Throughregular physical examination, female employees can keep abreast of their health status in time and take appropriateprecautions and treatments for identified health problems. At the same time, we apply for social insurance subsidies fortheemployeeswithdisabilitiestoprovidemorenancialsupport.
Number of femaleemployees
6,577people
Share of women in totalworkforce
45.8
%
Share of Women inManagement Positions
35.4
%
Case
Livzon Group’s Diversity Training
Corporate Social Responsibility Report 2023
In addition, starting from this year, we plan to conduct regular satisfaction surveys for all employees of the Group andits subsidiaries every year. Based on this, we respect and understand advice and feedback from employees in time toimprove employees’ satisfaction and engagement.
The information onwhistleblowers and complainantsas well as the content of reportsand complaints should be strictlycondential.Thematerialsandrecords of reports should beincorporatedintocondentialdocument management. Thesettledcasesshouldbeled.
Receiving reports and complaintsand verifying with relevantpersonnel, such as whistleblowersand complainants, should beconductedinacondentialway,without the identity of the personnelbeing disclosed.
Any personal information,including identity and rewardscannot be disclosed without theexpress consent of whistleblowersand complainants.
In2023,ourheadquartercarriedoutanemployeesatisfactionsurveytoassesshowemployeesfeelat work and how much they identify with the Company. The metrics covered include organisationalsupport, work-life balance, career development opportunities, diversity and inclusion, the workingenvironment and the like. According to the survey results, 98% of our employees participated inthe activity, of which 90% were satisfied. The majority of employees were satisfied with our overallperformance and confident in our future development. The problems reported by employees areaddressed with proper corrective measures. This helps to further increase employees’ engagement andjob satisfaction and to create a better working environment and development opportunities for them.We will follow up on the needs and feedback of employees and keep optimising our managementstrategies, to enhance their sense of belonging.
EmployeesatisfactionsurveyatJoincareheadquarter
7.1.4Sta?Communication
We respect and value the views and suggestions of employees. We continuously improve employee communicationchannels,regularlylistentotheirvoicesthroughquestionnaires,andprovideanonymousfeedbackchannelstoensurefreeexpression. We also provide a feedback box to encourage employees to give written comments and suggestions at any time.Meanwhile, through regular seminars and one-on-one talks in daily work, we maintain close communication with employeesviainternalnewslettersandemailstounderstandtheirneedsandsolvespecicdi?cultiesintheirworkandlife.In order to smooth the employee grievance reporting channels, we have established and strictly abide by the Measures forthe Management of Complaining and Reporting, and we have built a formal grievance escalation and reporting procedureswhere grievances can be reported smoothly and confidentially. We urge all employees to timely complain or report theviolation of the Code of Employment, labour rights and any dissatisfaction. We strictly keep the confidentiality of theinformation on complainants as well as the content of complaints and take necessary measures to protect the physical safetyand legitimate rights and interests of the complainants. Also, the Company convened a meeting of the Audit Committee ofthe Board of Directors on 2 April 2024 to deliberate the Joincare Pharmaceutical Industry Group Co., Ltd. Complaining,ReportingandWhistleblowerProtectionPolicy,whichwasdisclosedontheo?cialwebsiteatthesametime.
Protection Measures for Complainants
Case
Labour Union Management
Joincare regards the labour union as an important link between management and employees. To strengthen exchange withemployees, Joincare holds regular workers' congresses to maintain close communication with them, involving them in theGroup’s major decision-making. Meanwhile, we invite professional psychological consultants to deliver courses, helpingemployees relieve stress and relax themselves. This year, 100% of employees were represented by the independent tradeunion.
Joincare’s holding subsidiary Livzon Group conducts employee engagement surveys once everyyear. In 2023, Livzon Group hired a third-party institution to conduct an employee engagementsurvey in accordance with the Kincentric model of the Gallup system from 16 dimensions,including organisational support, work-life balance, career development opportunity, diversityand inclusion, performance management, and employer brand. The survey covers employees' jobsatisfaction (recognition of the company and job responsibilities, and intention of retention, publicityand endeavour), purpose of work (personal work goals and company business goals), happiness(satisfactionwithworkplacediversity,genderequity,benefits,rewardsandrecognitions),andstress(reasonableness of work pressure and work-life balance) and other aspects. The survey covered allpermanent employees of Livzon Group. The response rate was 98%, and the overall engagement scorewas 75%.
Livzon Group conducts employee engagement surveys（Gallup system）
7.2 Improving Talent Management
Joincare highlights talent cultivation. With a formal talent pipeline development strategy, we recruit talents based onscienticforecastofhiringneeds.Weactivelydevelopnewpoolsoftalenttoimproveprotabilityandmaintainourcorecompetitiveness. We continue to strengthen talent management and open up more channels in talent introduction, strivingtoretainandmakefulluseoftalentwithevengreatere?ort.Foremployeesatdi?erentlevelsandindi?erentpositions,we developed targeted development programs, training plans and incentive mechanisms, and provide generous salariesandbenetstoenhanceemployees’satisfactionandhappiness.
%of employees were represented by the independent trade union.
Case
Corporate Social Responsibility Report 2023
In 2023, Joincare was approved to establishthe Shenzhen Post-doctoral InnovationPractice Base, which aims to strengthenR&D teams and their capabilities, promotethe transformation of scientific researchachievements, and provide strong support forthedevelopmentofhigh-endscienticresearchtalents. By adopting a tutorial system andsetting up an incentive system for post-doctoralresearchers, the Base deepens the integrationof production, education and research,and implements the Group’s technologicalinnovation-driven strategy to further elevatethe Group’s core competitiveness.
Progress of the post-doctoral station planning at Joincare
7.2.1 Talent Attraction and Retention
Joincare has been stepping up efforts in talent employment by experienced hire recruiting and campus recruiting. Wereinforce our talent pool through channels including online recruitment, internal recommendation, headhunting, andcooperation with governmental agencies. We aim to match the right talents with the right positions and increase ourteam value, continuing to drive the sustainable talent development. We make progress in creating a multi-level talentreserve and plan to use Feishu for the information management of talent reserve in an orderly way in the next reportingperiod. Thus, we are able to share the information resources of the talent reserve within the Group. We carry out regulartalent review according to our strategic planning and business development trends, identifying the key positions and keyemployeecommunities,andsettingthestagegoalsofsta?ngateachlevel.Moreover,wefocusonthelatesttalentowand salary level in the industry, conduct internal and external surveys in various ways, and design suitable recruitmentstrategiesbytheprincipleofmaximisingcostvalue.Wearecommittedtoboostingtalentacquisitionandretentionwithexcellentcorporatecultureandpositivehumanisticcare,providingadequatehumanresourcesupportfortheGroup’sfuture development. This year, the Group introduced a total of 3,999 new employees.
University-Enterprise Cooperation
Joincare has been investing effort for many years in the integration of production, education and research with keydomestic universities, colleges, and vocational schools, signing traineeship agreements with undergraduate and juniorcollege students in the pharmaceutical field, providing customised traineeship platforms, and offering employmentopportunities for outstanding interns. This year, we have partnered and signed traineeship agreements with educationalinstitutions including China Pharmaceutical University, Shenzhen University, Hunan Traditional Chinese MedicalCollege, Qiannan Medical College for Nationalities, Guangxi Vocational University of Agriculture. We carried outtraineeship programme through apprenticeship, alternating work and study, etc. and provided our interns with satisfactorysalaryandbenets,mealsubsidies,accommodation,medicalexamination,andmore.Forfreshgraduateswhoexcelledintheproduction-educationintegrationortraineeshipperiod,weo?erthemtheprioritytobecomepermanentemployeesatJoincare. This year, we newly introduced 150 interns, 20 of which had been hired as permanent employees.
New interns
peopleNew employees
Post-doctoral Innovation Practice Base
Case
3,999people
Joincare and East China University of Science and Technology (ECUST) launched a joint graduatetraining programme. Under the programme, experts from ECUST provide the graduates withcomprehensive guidance and training on research project selection, dissertation proposal writing,research structure design, test programme design, data analysis, report writing, and the like. Weprovide the graduates with free accommodation, transport subsidies for their family visits in thesummer and winter, and many other benefits. This frees them from money worries so they canconcentrate on studies and work. We continue to cooperate with institutions of higher learningin training and reserving strategic technological talents, which provides a strong support fortechnological innovation and solving key and core technological issues.
Joint graduate training programme of Joincare and East China University of Scienceand Technology
Talent RetentionTo reduce employee turnover and maintain workforce stability, we provide employees with diversified careerdevelopment opportunities, including training, promotion, job transfer, etc. in a comfortable, safe, and healthy workingenvironment. We strive to balance work and life, organise stress-relief activities, and provide psychological consultation,creating an upbeat and healthy atmosphere at Joincare. We also continue our efforts in optimising employee benefitsand welfare to retain excellent talents by establishing a long-term incentive mechanism. We carry out regular talkswith employees to listen to their voices, such as their turnover intention. Through one-to-one interviews with outgoingemployees, we know their reasons for leaving, which helps us to improve our talent retention plans. Furthermore, weconduct a statistic analysis on data of employee turnover rate and formulate specific improvement measures. This year,the Group’s turnover rate was 12% (2022: 12%)
.Overthepastthreeyears,nomajorlay-o?soranymergersoracquisitionsa?ectingemployeesoccurredinJoincare.
2?
In order to better demonstrate the Group’s human resource management and ensure the consistency of the calculation of internalmanagement and external disclosure, the calculation of the turnover rate in 2023 directly adopted the methodology used by the Group’shumanresourcesmanagement,i.e.thenumberofemployeeresignedwasequaltothenumberofpermanentemployeeswhovoluntarilyresign. Due to the different calculation method of the overall employee turnover rate in 2021 and 2022, we made retrospectiveadjustments to the 2021 and 2022 turnover rate in the current year, so that the employee turnover rate from 2021 to 2023 would becalculated on the same basis, to ensure that the data are continuous and comparable.
The Group’s turnover rate
%
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Corporate Social Responsibility Report 2023
7.2.2 Training and Development
Joincare attaches great importance to internal talent development. The Group continuously builds a comprehensive anddiversiedtrainingsystem,andconstantlyimprovestrainingresourcesbyusingonlineando?inelearningchannelsanddesigningtrainingcontenttailoredfordi?erentlevelsandpositions.Weconductregularsurveysandanalysisontrainingdemand,andspeedupthecourseupdatefrequency.Thisensuresthatcoursecontentissynchronisedwithourbusinesschanges and technology updates, and meet the needs of employees’ skill development. With the help of an online learningplatform, our employees are able to learn anytime and anywhere.By the end of the reporting period, we had provided 975,834 hours of training to all employees, with 67.9 hours oftraining per employee.On-boarding TrainingWe attach great importance to new employee training, and custom-design a 6-month “follow-up plan” for fresh graduatesand new employees, establishing a training framework for fresh graduates covering three-stage career development:
On-boarding, Growth and Success. Each new employee is assigned a mentor, and using centralised training courses,practical exercises, summary sharing, and more, we convey the corporate culture, rules and regulations, professionalskills,etc.tothenewemployees,helpingthemquicklyadapttotheworkingenvironment,andfamiliarisethemselveswith the job content and working process. During the plan, we track and evaluate the training and work performanceof new employees each month, timely understand the feedback from departments and employees, and grant incentivessuch as early access to becoming regular employees and pay rise to outstanding employees. We also continue to followemployees’ development after the probationary period, and provide them with career planning suggestions clarifying theircareer goals.Meanwhile, we cooperate with higher education institutions such as Hunan Traditional Chinese Medical College andXinxiang University to deliver joint training programmes for employees. Both parties will provide a joint instructor team,share teaching resources, and co-implement academic assessment and evaluation, providing students with traineeshippositions,andcarryingouttheoreticalandpracticaltrainingondrugproduction,qualitycontrol,sterileoperation,safeproduction, machine operation, etc.
TohelpfreshgraduatesquicklyunderstandJoincare’sculture,policies,anddevelopmentpaths,andhelp them take the first step toward society, we design specific training programmes for them. In July2023,Joincarelaunchedtheve-day“Dream&Future”trainingprogramforcampusrecruitment.Thetraining was held by the Group’s HR Department, together with Guangzhou Joincare, Haibin Pharmaand Taitai Pharmaceutical. It aims to facilitate fresh graduates’ shift from campus to workplace, helpthem get familiar with the corporate culture and core values, and increase their sense of belongingthrough activities including massages from executives, team building, intensive course training, andoutdoor exercises. In 2023, we organised the training programme engaging a total of 37 fresh graduateswith 1,480 training hours.
“Dream & Future” Campus Recruitment Training CampCase
“Dream & Future” Fresh Graduates Training
Job-specicDevelopmentTrainingWe seek a variety of external training resources and tailor job-specific development training programmes for ouremployees according to the characteristics and business needs of different positions. For special operations positions,weorganiselearningofrelevantregulations,safeoperationprocedures,andtechnicalrequirementsandcarryourqualicationtraining,ensuringthatemployeeshavetherequiredcerticates.ForR&Dpositions,weo?erenhancementtraining courses on project management, experimental skills, literature sourcing, innovative thinking, and other abilities.Forproductionpositions,wecarryoutpracticaltrainingonsafeproduction,equipmentoperation,environmentalawareness,qualityawarenessandotherknowledge.Forsalespositions,weprovideenhancementcoursesonproductknowledge,marketingcompliance,salesskillsenhancement,andotherabilities.Forqualitymanagementpositions,weconductpracticaltrainingonqualityknowledge,qualityawareness,regulationsandpolicies,operationalskills,andmore.
Weputahighvalueonthedevelopmentofskilledtalents.Forproduction,quality,andotherpositions,we implement an apprenticeship system. Following the principle of selecting mentors of “excellentability, similar position, and interconnected work”, we sure perfect master-apprentice match andeffectiveinstruction.Thementorsareresponsibleforguidingtheapprenticesinproductqualityassurance(QA),qualitycontrol(QC),front-lineproductionoperationandotherpositionstoacquiretheskillsandabilitiesrequiredfortheirrespectivejobs.TheHumanResourcesDepartmentorganisesmentorship discussion sessions to learn the teaching and learning performance between all mentors andapprentices.
Developmenttrainingforproductionandqualitypositions
Promotion and Job Transfer MechanismsWe value the career planning of our employees and are committed to providing them with fair career opportunities.We have established a dual-promotion mechanism (“Professional” and “Management”) to help employees choose theappropriate career path according to their own interests and capabilities. In terms of promotion, we adopt the combined“progressive promotion” and “exceptional promotion” approach for employees with outstanding performance or specialexpertise. This approach stimulates the enthusiasm and creativity of our employees and provide a strong talent reserve forthe Group’s long-term development.Wefullyappreciatethevaluecreatedbyemployeesindi?erentpositionsandencouragecontinuousself-improvementvialearning.Weprovideequalcareeropportunitiesforouremployees.Toencourageemployees’careerdiversification,weregularly publish internal recruitment information. Employees can participate in internal recruitment based on their owncareerdevelopmentplansandprofessionalskills.Employeeswhomeetthejobrequirementsandpasstheinterviewcancontinue to contribute to the Group after the formal job transfer. At the same time, we provide relevant training resourcesfor our employees to help them adapt well to their new positions. Furthermore, employees or departments in need mayalso initiate internal applications of job transfer if necessary.
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Corporate Social Responsibility Report 2023Succession Planning and Leadership DevelopmentWe continue to implement succession plans for talents, comprehensively evaluate the performance, potential, andcareer aspirations of key position employees, and accurately identify potential successors based on the evaluationresults. To help successors improve their capabilities for the job, we carefully design individual development plans andorganise management training sessions and other relevant programmes. At the same time, we regularly monitor theimplementation of succession plans for talents and make adjustments to the personal development of potential successorsaccording to the actual needs, securing the best career opportunities for potential successors. This year, we continued toimplement the talent succession plans, provide promotion and salary increase opportunities for employees who excelledin professional skills, comprehensive capabilities and other aspects, relentlessly consolidating our talent cultivation.Toimprovethemanagementabilityandcomprehensivequalityofthemanagement,weregularlycarryoutmanagerialdevelopment training with internal and external lecturers, covering leadership development, team building,communication skills, decision making, and other aspects. During the training sessions, the management learned fromactual cases of the Group or other enterprises, understood all kinds of problems and challenges in practice and exploredsolutions, thereby improving their management and leadership abilities.
In 2023, Taitai Pharmaceutical, a subsidiaryof Joincare, organised 50 training sessions ofmanagerialdevelopmentandqualityassuranceforitsmanagement. The company combines learning andtraining with work practice, industry developmenttrends, and personal growth through case sharing,group discussions, interactive communication, andother training methods to improve the pertinenceand effectiveness of training. At the same time, itfurther enhances the theoretical literacy, business andmanagement skills of the management in industrydevelopment, and enhances team collaboration andcommunication skills.
Management training programme of Taitai Pharmaceutical
SupportforDegreeProgrammesandCertications
We encourage continuing education and support all employees (including part-time and contractors) to obtain academicdegreeorprofessionalcerticationsandparticipateinskilltrainingandindustryforummeetings.Throughprojectssuchas career-based study for a master’s or doctor’s degree, we help employees upgrade their educational backgrounds. Wealsoassistouremployeesinapplicationforspecicqualicationsornationalprofessionaltitlecerticatesrelatedtotheirpositions, and implement internal measures such as tuition reimbursement, exam leave, and study leave. We offer fullsupportforemployeeswhoparticipateinexternaltrainingandobtainprofessionalcerticationsrelatedtotheirpositions.Moreover,weactivelyassistemployeesinapplyingforlocalqualificationsforhigh-leveltalents,craftsmen,industrialinnovation and development talents, and innovation teams based on local talent policies.
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Management training of Taitai Pharmaceutical
Joincare’s holding subsidiary Livzon Group formulated and issued the Administrative Regulationson Employee Learning and Growth, providing all employees with 3 major categories (degree,professionaltitleandvocationalqualification)ofacademicdegreeandcertificationimprovementprogrammes, as well as training materials for each business segment, to support employees inapplication for programmes that fit their own needs of self-improvement. At the same time, LivzonGroup seeks external cooperation with higher education institutions and encourages employees toimprovetheiracademicdegreesandcerticationsthroughself-studyexams,correspondencecourses,full-time or part-time training, distance education, and on-the-job postgraduate studies. The degreesand certifications obtained by employees are taken into consideration for their promotion and payrise, mobilising their enthusiasm for participation. In 2023, a total of 41 employees of Livzon Groupattainedhighereducationqualifications,and1,350employeesobtainedskillsorprofessionaltitlecerticates.
In2023,JiaozuoJoincarewassuccessfullyqualifiedtoindependentlycarryoutprofessionalskillcertification. The company organised professional skill certification exams for technicians as pernational standards based on their production needs and the characteristics of technical positions. Atotalof162qualifiedemployees(includingelectricians,instrumenttechnicians,fitters,etc.)weregranted senior, intermediate, and elementary certificates, which fuelled high-skilled talent reserve ofthe company and reinforced the foundation of talent development.
SupportfordegreeprogrammesandcerticationsatLivzonGroup
ThesupportprogrammeforskillcerticatesatJiaozuoJoincare
7.2.3CompensationandEmployeeBenets
Joincare has developed and followed internal policies such as the Salary Management System and the PerformanceManagement System in strict accordance with laws and regulations. In doing so, Joincare aims to build a fair andcompetitivewelfaresystembyadoptingane?ectivesalarystrategythata?ectsmotivation.TheGroupupholdsthesalarymanagementphilosophyof“ensuringtheconsistencybetweenresponsibilityandbenet,theconsistencybetweenabilityand value, and the consistency between performance and earnings”. We have established a compensation mechanismthat is consisted of fixed and variable components for all employees (including non-officer and non-sales employees).The variable compensation is subject to both the Group’s performance and employees’ performance. We believe thismechanism can make employees highly motivated.
Performance Appraisals and Feedback ProcessAdvocating fairness, justice, and transparency in performance management, we have established a clear performanceevaluation and feedback mechanism. We continue to implement a dual-track management system of OKR (Objectivesand Key Results) and KPI (Key Performance Indicators), and use or draw on various evaluation methods such asmanagement by objectives, 360 degree feedback, team-based performance appraisal, agile conversations, etc. We carryout performance evaluations twice a year for all employees, to assess the overall performance of employees at all levels
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Corporate Social Responsibility Report 2023comprehensively and objectively. Performance appraisals includes department-based and employee-based evaluations.The former focuses on major tasks, lean management, team building, etc., while the latter focuses on individualperformance, code of conduct, work improvements, etc. A weight is also given to the feedback and guidance that themanagement provide to employees. After the performance evaluation, department supervisors will listen to employees’voices in performance talks, suggest on improvements, and jointly formulate next-round performance goals andimprovement plans.To further improve the overall management of the Group, optimise team performance management, and promotesustainable development, we have integrated sustainability indicators into employee performance evaluation, whichrepresent compliance of employee code of conduct, employee compliance, occupational health and safety, environmentalprotection, labour risk management, etc. These are also linked to employee salary.Long-term Incentive Mechanisms
To further improve the Group’s long-term incentive mechanisms and fully motivate core employees, Joincare hasformulated various long-term incentive plans for directors, senior management, middle management and core technicians.The interests of shareholders, the Group and core team members are thus united, helping motivate the initiative andcreativity of core employees and build a working environment with shared responsibilities and values. Since the end of2014, we have successively launched the 2015 restricted share incentive scheme and 2018 share options incentive schemeto improve the long-term incentive mechanisms for employees. Up to now, the 2015 restricted share incentive schemewas completed in 2019, and the 2018 share options incentive scheme was completed in 2022.The progress of our two existing Employee Share Ownership Plan/Share Options Incentive Scheme in 2023 is shown asfollows:
? We developed the Medium to Long-term Business Partner Share Ownership Scheme (Draft) at the end of 2019.The plan benefits senior management and core personnel engaged in R&D, production, sales, and management withoutstanding performance during assessment or significant impacts on the future performance. The validity period ofthe plan is from 2019 to 2028. The First, Second and Third Phase Ownership Schemes were approved on the GeneralMeeting in June 2021 , May 2022 and October 2023 respectively.? The Third Phase of Ownership Schemes accumulated 9,370,400 shares of the Company's stock on December 20, 2023,with a total transaction amount of RMB 115.44 million. A total of 74 persons participated in this shareholding plan,include 7 directors (excluding independent directors), supervisors and senior management and 67 other employees.? In September 2022, the Board of Directors deliberated and approved the 2022 Share Options Incentive Scheme(Draft), proposed to grant 55.00 million stock options to the incentive recipients, of which 49.50 million stock options,or90.00%ofthetotalnumberofstockoptionstobegrantedunderthePlan,aretobegrantedforthersttime,and5.50million stock options, or 10.00% of the total number of stock options to be granted under the Plan, are to be granted asa set-aside. The beneficiaries of the Incentive Scheme include directors, senior management, middle management, coretechnicians, and those recognised by the Board of Directors as deserving incentives, with meet performance evaluationgoals as the vesting condition.? On September 5, 2022, the Board of Directors deliberated and approved the 2022 Share Options Incentive Scheme(Draft), granting 49.45 million stock options to 423 incentive recipients with September 5, 2022 as the first grant date.On August 11, 2023, the Board of Directors of convened a meeting to consider and approve the Proposal for GrantingReserved Stock Options, determining August 11, 2023 as the reserved grant date for granting 5.5 million stock optionsto 149 incentive recipients. The beneficiaries of the Incentive Scheme include directors, senior management, middlemanagement, core technicians, and those recognised by the Board of Directors as deserving incentives, with meetperformance evaluation goals as the vesting condition.
In addition, Joincare’s holding subsidiary Livzon Group also implemented the following Employee Share OwnershipPlan/Share Options Incentive Scheme :
? In November 2023, Livzon Group approved the Third Phase of Ownership Schemes of the Medium and Long-term Business Partner Shareholding Plan through the shareholders' meeting. A total of 84 persons participated in thisshareholding plan, including 8 directors (excluding independent directors), supervisors and senior management and 76other employees.? In October 2022, Livzon Group approved the 2022 Share Options Incentive Scheme by the general meeting. TheScheme granted incentives to 1,026 employees in the first vesting period, including 8 directors (excluding independentdirectors) and senior management, and 1,018 other employees. The first vesting period was completed in November2022.? In October 2023, the Board of Directors of Livzon Group considered and approved the Proposal on Matters Related tothe Proposed Reserved Grants under the 2022 Stock Option Incentive Plan, which determined the reserved grant date tobe October 30, 2023, and granted 2,000,000 stock options to 243 incentive recipients.EmployeeBenetsSystemJoincare is committed to optimising the employee benefits system applicable to all employees to improve employeewelfare. We provide our employees with statutory holidays and contribute to pension, medical, unemployment, work-related injury, maternity, and housing provident funds.In addition to the statutory benefits, we build an employee benefits system consisting of three pillars: health support,familyandpersonalsupport,andwork-lifebalance,providingbroadrangeofmaterialnon-paybenetsforallemployees(including full-time, part-time, and contractors): we provide dormitories for our employees and assist them in applyingfor government-run talent apartments or housing subsidies for talents to ease their housing pressure; we set up aninternalgymfreetoallemployeesandregularlyinvitetnessinstructorsforprofessionalguidance;weorganiseregularevents such as year-end parties, celebrating traditional festivals, and team building to create a harmonious and healthyworkplace; we carry out cultural activities after work with a focus on employees’ hobbies and interests to grow teamspirit and balance employees’ work and life; and we support employee physical health by regularly launching activitiessuch as occupational health check-ups, AED first-aid training, oral health lectures, stress and emotion managementcourses.Allthesee?ortscontributetogreaterfeelingsofhappinessandbelonging.Table:JoincareEmployeeBenetsSystem
Health supportFamily and personal supportWork-life balance
·?Annual health check-ups for employees?·?Occupational healthcheck-ups?·?Health check-ups forfemales?·?Psychologicalcounselling?·?Accident insurance?·?Extra pay for hotweather
·?Employee canteen·?Dormitories·?Government-run talent apartments·?Housing subsidies for talents·?Living allowance for talents introduced·?Support for advanced studies under master's and doctoralprograms·?Commuter allowance·?Gifts for traditional holidays·?Cash gifts for birthday, wedding, and maternity
·?Funeral and retirement solatia
·Gym·Break rooms·Team building·Annual parties·Associations·Library
Corporate Social Responsibility Report 2023
Employee Birthday PartyFree Gym Access
Heartwarming Women’s DayStress and Emotion Management Courses
On-site Traditional Chinese Medicine ServicesFirst Aid Training for Employees
7.3 Occupational Health and Safety
Joincare upholds the safety management policy of “Safety First, Prevention First, Integrated Management” and advocatesthe “Putting People First” safety concept. We strictly abide by the laws and regulations regarding occupational healthand safety, such as the Law of the PRC on Work Safety and the Law of the PRC on the Prevention and Treatmentof Occupational Diseases. We have established the EHS Management Policy to clarify the Group’s standards for allemployees in terms of health and safety, and encourage compliance among business partners (including customers,suppliers,contractors,etc.)withJoincare.WereneandoptimisethePolicythroughconsultationwithemployeesortheirrepresentatives, thereby continuously enhancing the Group’s performance in occupational health and safety management.Furthermore,inaccordancewiththerequirementsoftheISO45001OccupationalHealthandSafetyManagementSystem, we have revised or formulated 36 management policies, including the Environmental and Occupational HealthManual, the Occupational Hazard Prevention and Control Accountability Policy, and the Risk Assessment and SafetyManagement Policy. These policies help us identify, analyse, and control potential risks in daily operational management,ensuring the health and safety of our employees. In 2023, the Group’s safety management focused on fire safety,occupationalhealth,andleanmanagement,withgoalsdenedaccordingly.
Joincare’s Occupational Health and Safety Goals in 2023·Fire safety: No work safety accidents·Occupational health: No new cases of occupational diseases·Lean management objectives: We continue the construction of the EHS system, complete internal and externalaudits and management reviews within this year. We improve the emergency system and conduct plannedemergencydrills.Wealsoaddsafetysessionsinouron-boardingtrainingforallnewemployees,ando?erspecialsafetytrainingforspecicemployees.The EHS Management Committee, as the highest decision-making body of EHS management, consists of Boardof directors and executive management, production leaders and EHS leaders, and is responsible for formulating theoverall EHS development strategy and policies on occupational health and safety. General Managers of Joincare andits subsidiaries are the first persons responsible for supervising and promoting EHS management to provide a safe andhealthy working environment. Presented below is how the Group prioritised and integrated occupational health and safetyaction plans in 2023:
Overview of the Group’s Occupational Health and Safety Action Plans Prioritisation and Integration in 2023·We establish annual safe production goals and work plans.·We increase safety investments, especially in automated facilities, to reinforce our safety foundation.·We implement a safe production responsibility system for all employees.·We improve the emergency system and conduct emergency drills.·We provide more safety educational training to raise employees’ awareness of safe production.·WecontinuetobuildtheEHSmanagementsystemandreneourmanagementregulationstoensureproduction compliance in programmes.·We strengthen risk management, push forward the standardisation of safe production, and integrate the dual- prevention systems.·We standardise the management of special operations and strictly control operation approvals.·We enhance safety management of contractors, with all contractors signing safety management agreements toimprovethemanagementqualityofexternalconstructioncrews.
Corporate Social Responsibility Report 2023JoincareheadquartercarriesoutEHSinternalaudit,managementreviewandexternalauditonceayear,andtheGroup’sproduction subsidiaries also conduct internal and external audits in accordance with their respective plans to verifywhetherEHSmanagementcomplieswithISO45001,soastoimprovethee?ectivenessoftheEHSmanagementsystemand ensure the compliant and effective management for modules such as safety, environmental protection, occupationalhealth,reprotection,etc.indailyoperation.
We review EHS-relateddocuments and ledgers andsupervise the performanceof EHS targets.
Document review
We check potential hazardsin production sites, andverify whether on-site safetycontrols are effective, and safeprotective articles are in placeto reduce potential accidents.
On-site audits
We propose suggestionsfor new, reconstructionand expansion projectsfrom the perspective ofEHS to improve safetymanagement throughouteach project.
New, reconstruction andexpansion projects reviewEHS Internal
Audit
Joincare continuously increases investments in occupational health and safety. We upgrade work safety technology andequipment,andcarryoutsafetytraining,safetyemergencydrillsandotheractivities.Thisyear,weinvestedaboutRMB44,646 thousand in occupational health and safety, with the expense breakdown as follows:
Table: Breakdown of occupational health and safety expenses
(1) Work safety expensesRMB33,034 thousandIn which: Expenses of safety training and educationRMB1,808 thousand Expenses of safety emergency drillsRMB1,051 thousand
(2) Occupational health expensesRMB11,612 thousand
7.3.1 Occupational Health
Joincare continues to improve and strictly follow management policies such as the Occupational Health ManagementSystem and Operating Procedures, the Monitoring and Evaluation System for Occupational Hazard Factors in theWorkplace, and the Regulation on the Management of Hazard Identification and Evaluation, to identify, analyse andcontrol the occupational hazards that may arise or exist in the work process. To further advance the construction of theoccupationalhealthandsafetymanagementsystem,Joincareworksactivelytoobtainexternalcertications.Bytheendof the Reporting Period, Joincare and all its production subsidiaries had obtained the GB/T45001-2020/ISO 45001:2018OccupationalHealthandSafetyManagementSystemcerticationwithacoveragerateof100%.In 2023, Joincare continued to invest in occupational health protection for employees. We built special funds to optimizeworking environment, monitor occupational health and procure labour protection articles and regularly maintained,overhauled and upgraded protective facilities. This year, no new or suspected occupational contraindications oroccupational cases occurred at Joincare.
Joincare’s EHS Internal Audit
Joincare’s Safeguards for Occupational Health and Safety
Occupationalhazardscheck-ups
Occupational
healthmonitoring
Safeguardingoccupationalhealth ofspecial posts
●?Healthierandmoreharmlessprocesses,equipment,materials,etc.arepreferredtominimise the impact of hazards on employees.●Weengagequalifiedserviceproviderstocarryoutregulartestingforpotentialoccupational health hazard factors; conduct occupational disease hazard evaluation inaccordance with the Regulations on the Management of Occupational Health in theWorkplace.We arrange regular occupational health examinations for employees in positionsexposed to occupational disease hazards:
●?Pre-job examination: We organise pre-job occupational health examination foremployees who are about to engage in operations exposed to occupational hazards andoperationswithspecialhealthrequirements.●?On-job examination: We organise regular on-job occupational health examination foremployees who are exposed to occupational hazards.●?After-jobexamination:Employeesarerequiredtoundergohealthexaminationbeforethey change posts or leave current posts that are exposed to occupational hazards.
●?Weequipemployeesexposedtooccupationalhazardswithlabourprotectionarticlesandrstaidsupplies.
●?We set up warning signs in places where occupational disease hazards may beinvolved.●?We maintain, overhaul and upgrade protective facilities against occupational diseases.
In April 2023, Xinxiang Haibin conducted weeklongpublicity on the Law of the PRC on the Preventionand Treatment of Occupational Diseases with thetheme of “Improving the working environment andconditions, protecting the physical and mental healthof workers”. The company developed a publicityplanforthis,includingaquizbankandanonlineexamination system. 91% of employees completedthe online exam, which effectively enhanced theirknowledge and awareness of occupational diseaseprevention and treatment and the Law.
Weeklong publicity on the Law of the PRC on the Prevention and Treatment ofOccupational Diseases at Xinxiang Haibin
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Brochure for Publicity of the Law of the PRC onPrevention and Control of Occupational Diseases
Corporate Social Responsibility Report 2023
7.3.2 Work Safety
Insisting on the work safety guidelines directing “safety awareness, legal compliance and continuous improvement”,Joincare has formulated management policies such as the Safety Management System Operation Control Managementand the Operation Assessment System for Dual Prevention Systems to improve work safety management. Meanwhile,we conduct risk identification and assessment, analyse and review the feasibility of existing risk control measures, andorganise risk notification training sessions. We also have established a risk control mechanism to curb risks at the levelof the Group, workshops, and positions respectively, and define the safety responsibilities of employees at all levels.This year, we improved the Change Management System to ensure that the hazards arising from changes in productionprocesses and facilities were under control.
To improve employees’ capabilities in emergencyresponse to occupational disease accidents, JiaozuoJoincare has established and optimised the operationalprocedures for positions with occupational hazards,improved occupational health records, and issued anOccupational Disease Emergency Response Plan withregular drills. Additionally, to mitigate the occurrenceof occupational hazards, Jiaozuo Joincare hasimplemented a series of engineering control measuresagainst occupational disease hazards such as dust,toxic chemicals, and noise, to safeguard the health ofemployees. In April 2023, the company carried out anevaluation and testing and published the results on thestatus of occupational disease hazards, covering a totalof 161 testing points. In May, the company organisedoccupational health examinations and establishedmonitoring records, with 422 employees taking theexamination, achieving a 100% participation rate. Nooccupational diseases or contraindications were found.
Occupational health management enhanced at Jiaozuo Joincare
Changed by external experts
Level 1 Major Changes
Changed by external expertsupon an evaluation ofsubsidiaries’ EHS Team
Level 2 Process Changes
Workshops or departments areassessed by EHS Change TeamLevel 3 Workshop Changes
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Occupational Health Check-ups
At Joincare, we carry out regular internal audits on safety systems, deliver safety training to employees, and relentlesslyimprove work safety infrastructure to ensure a safe workplace. For new hires or those returning to work or transferred toanewpost,weengagetheminpre-jobtrainingbasedonthejobrequirements.Inaddition,werequirespecialoperationpersonneltoparticipateinqualicationtraining,includingtrainingsessionsformanagers,safetymanagementandspecialequipmentoperation,andacquirerelevantcerticatesbeforework.This year, no safety accidents occurred in the Group, achieving the goal of “zero safety accidents”.Safety InspectionThis year, Joincare and its subsidiaries carried out 1,735 safety inspections, including routine safety inspection, monthlyandquarterlysafetyinspections,specialinspectionsforhazardouschemicals,inspectionbyexternalexperts,canteensafetyinspectionsandotherinternalinspections.Toensuresafetyproduction,wesparedmoree?ortsinsafetyinspection,includinginspectionforlightningprotection,safetyinspectionforelectricrefacilities,specialequipmentinspection,realarmsystemmaintenanceandothersafetyrectications.
In June 2023, Taitai Pharmaceutical conducteda comprehensive safety inspection in the secondquarter.Theinspectionwasledbyseniormanagement, with department heads and front-lineemployees examining all critical hazard sources,confinedspaceriskpoints,specialequipment,andfire safety issues throughout the factory. A summarymeeting was held to define safety managementobjectives, which effectively strengthened thecompany’ssafetymanagemente?orts.
SafetyinspectionatTaitaiPharmaceuticalinthesecondquarterCase
Safety Inspection for the Second Quarter
Corporate Social Responsibility Report 2023
To enhance emergency response capabilities andteam development, Xinxiang Haibin conductedits annual emergency drill in June 2023. The drillengaged over 100 employees with an emergencydrill evaluation team incorporated during theevent. Composed of mid-level management andsafety engineers, the team assessed the handlingprocess and summarised experiences to improve theemergency response system.
On 30 June 2023, Haibin Pharma conducted anintegrated emergency drill against hazardouschemical (organic solvent) leakage and fire hazardin the newly constructed solvent storage area.The drill simulated a scenario in which a freighttruck’s unauthorised unloading operation resultedin a solvent barrel falling, leaking, and eventuallycatching fire. The drill concluded successfully,covering fire alarms, on-site handling, company-levelresponse,useoffire-fightingequipment,leakcontainment, and accident wastewater collection,effectively testing the capabilities of emergencyresponse team of the company.
Annual integrated emergency drill at Xinxiang Haibin
Emergency drill against hazardous chemical leakage in solvent storage area at Haibin Pharma
Emergency Plans and DrillsJoincare and its subsidiaries have established emergency response plans for internal safety incidents and contractorsafety incidents, covering overall emergency, specialised emergency, and on-site handling scenarios. All plans have beenreviewed and published. In 2023, the Group and its subsidiaries conducted 159 emergency drills, further refining andsupplementing the emergency response plans based on the drill results.
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Annual Integrated Emergency Drill
Emergency Response Drill againstHazardous Chemical Leakage
Safety Culture Cultivation
Joincare has formulated an annual training plan in line with national laws and regulations. This year’s EHS trainingcovered various topics, including safety orientation for new employees, specialised operation, safe productionresponsibility system, accident case study, safety management - team safety, occupational health and safety, dual-prevention system, laws and regulations on safe production, fire safety, and emergency drills. This year, our EHStrainings lasted for a total of 220,734.6 hours with approximately 16.9 hours per employee, successfully achieving thegoalof“Safetyorientationforallnewemployeesandspecialisedsafetytrainingforspecicemployees.”In 2023, the Group and its subsidiaries launched “Safety Month” campaigns. By participating in various activities such asthemed publicity and education, warning education on production accidents, safety training, emergency drills, and safetyinspection, our employees became more aware of safety at work. They got motivated to create a safety culture with jointe?orts.
On 7 December 2023, Joincare Haibin organised a three-level safety orientation training for new employees atthe factory. The training covered laws and regulationson safe production, basic principles of safe production,classification and causes of accidents, safety instructionsfor employees, fire safety knowledge, emergencyhandling measures, and job-specific standard operationprocedures. The training was conducted at three levels:
thecompany,workshops,andshifts,aimingtoe?ectivelyenhance the safety awareness of new employees, preventand avoid hazardous accidents, and secure the well-beingand safety of employees.
To ensure the stable and safe production and improvethe company’s safety management, Xinxiang Haibinorganised a themed training on the Guidelines forChemical Process Safety Management (AQ/T3034-2022) for all mid-level management and safetymanagement, reinforcing the leading role of themanagement in safety capability building.
Joincare Haibin’s safety orientation for new employees
Training on safety management in chemical process at Xinxiang Haibin
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Safety Orientation Training for New Employees
Training on Safety Management in Chemical Process
Corporate Social Responsibility Report 2023
Joincare upholds the sustainability principle and implements the concept of green and low-carbon development in every step ofits operation management. We are strongly committed to adhering to environmental laws and regulations. We are striving to usemore clean energy, promote low-carbon operations, conserve resources, reduce waste discharges, and comprehensively improveour environmental management capabilities. With these initiatives, we aim to better contribute to the national goals of “carbonpeaking” and “carbon neutrality” and fostering a harmonious coexistence with nature.
Operating with Green
Sustainability
SDGs in this section
8.1 Environmental Management System
Joincare strictly abides by laws and regulations regarding environmental protection, including the EnvironmentalProtection Law of the PRC, Energy Conservation Law of the PRC, and Administrative Measures for Hazardous Waste.Active efforts are made to optimise the internal environmental management system. We have developed the EHSManagementPolicytoregulatethemanagementrequirementsinkeyareassuchasthethreetypesofwastes(wastewater,waste gas, and solid waste), energy, chemicals, and water resources for the Group and its subsidiaries. With this policyin place, we aim to improve our environmental management practices. We have also introduced and kept improvingtheSafetyandEnvironmentalManagementManual,GeneralRequirementsfortheEHSManagementSystem,andRequirementsforIdentificationandAssessmentofEnvironmentalFactors.Thesearepartofoureffortstoimproveourcapability of managing environmental issues and take on our environmental responsibility pragmatically.In terms of environmental pollution prevention and control, we have developed and implemented the “threesimultaneous”policy,requiringeachproductionsubsidiarytoensurethepollutionpreventionandcontrolfacilitiesshouldbe designed, constructed and put into use simultaneously with the project’s main work. Meanwhile, we regularly maintainpollutionabatementequipmentandinvestincreasinglymoreinequipmentandfacilitiesupgradingandtransformationofproductionprocessesandtechnologiestoensuretheirnormal,stableande?cientoperation.In 2023, no major environmental pollution accidents and no administrative punishments occurred at any productionsubsidiaries of Joincare. Table: Expenditures of Joincare in environmental protection in 2023
CategoryAmount (RMB 10,000)Technicalupgradationofenvironmentalprotectionequipment1,565.45Environmental protection operation and maintenance8,764.56
8.1.1 Policies and Targets
Joincare adheres to the environmental management policy focused on “pollution prevention, legal compliance andcontinuous improvement”. Based on the environmental management status and performance, the Group has set five-year targets of energy saving and emission reduction, with 2020 as the baseline year, and keeps monitoring the progressforthetargets.Allproductionsubsidiariesarerequiredtorefinetheirmanagementofenergyandnaturalresourcesandpropel energy conservation and emission reduction at every link of production and operation to achieve environmentalmanagement targets together with the Group. Table: Energy conservation and emission reduction targets of Joincare
ItemIndicatorFinal Target by 2025WaterWater consumption per unit production (RMB 10,000)Down 5% from 2020ElectricityElectricity consumption per unit production (RMB 10,000)Down 5% from 2020Chemical oxygen
demand
Emission per unit production (RMB 10,000)Down 5% from 2020Sulfur dioxideEmission per unit production (RMB 10,000)Down 10% from 2020Disposal volume ofhazardous waste
Disposal volume per unit production (RMB 10,000)Down 2% from 2020
Corporate Social Responsibility Report 2023To constantly enhance the environmental management level and performance, the Group sets annual targets forenvironmentalcomplianceinoperationandurgesproductionsubsidiariestomeettherequiredstandardintermsofcompliance with the standards three dimensions for wastewater and gas emissions, the occurrence of major pollutionaccidents, and annual environmental penalties. Table: Targets of environmental compliance in the operation of Joincare in 2023
IndicatorAnnual TargetsAchievementsCompliant wastewater/gas emissions100%AchievedNumber of major pollution accidents0AchievedNumber of environmental penalties in the year0Achieved
●
?The EHS Management Committee coordinates the overallEHS management of the Group
●?The CSR Committee of the Board of Directors is responsiblefor formulating EHS-related strategies & policies andreporting the relevant issues to the Board of Directors.
●???The EHS Department of the Group supervises and managesthe implementation of EHS work in each productionsubsidiary●
?
Each Functional Department of the Group isresponsible for its own EHS work●Each production subsidiary of the Group isresponsible for its own EHS work and rep
EHS Management Committee
CSR Committee of the Board
of Directors
EHS Department of the Group
Functional Departmentsof the Group
Production subsidiariesof the Group
EHS Management Structure
8.1.2 Management Structure
To enhance the EHS management level, Joincare continuously improves the EHS management structure to defineresponsibilities and ensure their performance according to the EHS Management Policy. As the highest responsiblebody, the CSR Committee of the Board of Directors is responsible for formulating EHS-related strategies and policies,such as those on environmental management and resource utilisation, regularly reviewing the Group’s performance inenvironmental management performance, and reporting EHS issues to the Board of Directors.
Production subsidiaries of the Group have also developed a standardised EHS management system. As the firstresponsible person for EHS, the general manager is in charge of the overall environmental protection work; as the directlyresponsiblepersons,supervisorsordepartmentmanagersareinchargeofthepreparationofEHSinitiatives,lingtotheEHS Department of the Group, and supervision of the implementation of specific initiatives; and the employees of thesubsidiaries cooperate with the Group’s EHS policy and their EHS responsible persons in EHS management.Joincare actively fulfils the responsibilities of carbon emission reduction management. The EHS Department isresponsible for setting carbon emission reduction targets for the Group and its subsidiaries, reporting them to the CSRCommitteeoftheBoardofDirectorsforapproval,andfollowinguponthequarterlyachievementoftheGroup’scarbonemissiontargets.Thegeneralmanagerofeachsubsidiary,astherstpersoninchargeofcarbonemission,isresponsiblefor scheduling carbon emission targets based on the actual situation of the company, working out effective carbonemission reduction measures, designating relevant responsible persons, and reporting the target achievement to the EHSDepartmentoftheGrouponaquarterlybasis.Meanwhile,themanagement’sremunerationislinkedwiththeGroup’senvironmental performance to accelerate the realisation of energy conservation, emission reduction, and carbon emissiontargets. ESG indicators have been added to the individual performance assessment of all Social Responsibility WorkingGroup members since 1 January 2022, with a weight of 10% in the total performance system. ESG indicators and theirweights are as follows:
Table: Weight of ESG indicators in the assessment of Corporate Social Responsibility Working GroupTotal weight of ESGindicators
(1) Energy conservation and
emission reduction targets
Carbon emission
targets
(3) ESG rating objectives
10%3%3%4%
8.1.3AccreditationCerticates
Joincarecontinuestoimprovetheenvironmentalmanagementsystem.Wedevotedown-to-earthe?ortstoenvironmentalmanagement, proactively promote cleaner production and green factory certification. In 2023, Joincare and 100% of itsproduction subsidiaries were accredited to the ISO 14001 environmental management system. Among all productionsubsidiaries of the Group, 6 were accredited as the national green factory, 2 as the provincial green factory, and 8production subsidiaries completed HAZOP analysis. Details are as follows:
Table: Accreditation of the environmental management system of Joincare in 2023
Company Name
GB/T 24001/ISO 14001Accreditation
Clean Production Review
Green FactoryAccreditationJiaozuo JoincareAccreditedApprovedNationalJoincare HaibinAccreditedApprovedNationalHaibin PharmaAccreditedApprovedNationalTaitai PharmaceuticalAccreditedApproved/Xinxiang HaibinAccreditedApproved/Livzon XinbeijiangAccreditedApprovedNationalLivzon Pharmaceutical
Factory
AccreditedApprovedNationalLivzon HechengAccreditedApprovedNational
Corporate Social Responsibility Report 2023
8.1.4 EHS Audit
Internal AuditJoincare strictly implements internal audit procedures in accordance with the Group EHS Internal Audit ManagementProcedure, to make sure that its EHS management is effective. At the beginning of the year, the EHS Department of theGroup works with the audit team on an annual internal audit plan based on vulnerabilities found in past internal auditsand corrective actions taken by subsidiaries. The EHS Department conducts EHS audits on all subsidiaries at least twiceayear,andmakestimelysummariesandpreparesinternalauditreportsofsubsidiariesaftertheaudit.Subsequently,theEHSDepartmenturgestherecticationofunqualieditemsbythesubsidiaries,compilesagroupauditreporteverysixmonthsandsubmitsthemtothemanagementforreview.Correspondingproductionsubsidiariesshallrectifyunqualieditems found in the internal audit under the guidance of the Management Regulations on Corrective and PreventiveMeasures.In2023,theGroupconducted8EHSinternalauditsacrossallsubsidiarycompanies.AllunqualifieditemsfoundintheannualEHSinternalauditwererectiedwithacoveragerateof100%.ProductionsubsidiariesoftheGroupconsciouslyandregularlyinspectthestabilityofpollutantcontrolequipment,thedisposalmethodofsolidwasteandthelaunchofemergencydrills,andrectifytheunqualieditemsinatimelymanner,to firmly ensure the compliance of EHS management and the effective operation of the Group’s EHS managementsystem.External AuditJoincareconductsanexternalauditofEHSannuallyandengagesqualiedthird-partycerticationagenciestoauditandsuperviseproductionsubsidiariesthathaveobtainedISOcertification.In2023,werectifiedalltheunqualifieditemsfound and passed the external audit.
Company Name
GB/T 24001/ISO 14001Accreditation
Clean Production Review
Green FactoryAccreditationNingxia PharmaceuticalAccreditedApprovedProvincialGutian FuxingAccreditedApproved/Fuzhou FuxingAccreditedApprovedProvincialJiaozuo LivzonAccreditedApproved/Sichuan GuangdaAccredited//Livzon LiminAccreditedApproved/Shanghai LivzonBioAccreditedApproved/Shanghai LivzonAccredited//Livzon DiagnosticsAccreditedApproved/Livzon MABAccredited//
8.2 Addressing Climate Change
Climate change is a grave challenge facing all mankind. The warming trend of the climate system has continued inrecent years. As extreme weather events, rising sea levels and other climate problems become more severe, there is anurgent need to address climate change. In line with international trends, Joincare is committed to reducing the impact ofclimatechangeonhumanhealthandbusinessoperations.Whileintensifyinge?ortstomanageandaddressclimaterisks,we are working hard to seize the green development opportunities brought by climate change, to support the country’sachievement of carbon peaking and carbon neutrality.Referring to the guidance in IFRS S2 Climate-related Disclosures, we manage and disclose our climate-relatedinformation along four dimensions: governance, strategy, risk management, and metrics and targets. In 2023, werespondedtheCDPclimatechangequestionnaireforthersttime.Movingforward,wewillcontinuetodisclosedetailedclimate-relatedinformationbyrespondingtothequestionnaire.
8.2.1 Governance
The Group has established a climate governance structure based on the corporate social responsibility governance systemto manage climate change in a top-down manner. As the highest management body, the CSR Committee of the Board ofDirectors is responsible for developing and improving climate strategies, reviewing climate risk management policies,assessing climate-related targets and progress towards them, and monitoring the implementation of measures to addressclimate change. Joincare has set up a climate change response team at the Group level. The team is responsible forstudying and analysing the operations of the Group and its production subsidiaries, identifying the main climate-relatedrisks faced by the Group and developing solutions, and reporting on the risk responses to the CSR Committee. TheEHS Department leads our work on climate change, including making the list of climate risks, identifying and assessingclimate-related risks, analysing and listing potential climate-related development opportunities, and determiningaddressing measures and targets based on discussions with other business units and the climate risk scores.We have also developed and published the Climate Change Management System in 2023. The policy sets out theGroup’sproceduresforidentifyingandassessingclimate-relatedrisksandopportunities,aswellastherequirementsforimplementing and monitoring the response measures, to better drive our climate change management. In 2023, all oursubsidiaries engaged professional third-party companies in their carbon accounting, allowing us to comprehensivelyreviewthecarbonmanagementperformanceandactivelypromotethecarbonemissionsreductione?ortsoftheGroup.
8.2.2 Strategy
Joincare has made climate change issues part of its decision-making on corporate strategies. We stay focused on theimpact of climate change on our short and long-term production and operations. We strive to improve the overall abilityto manage climate risks by identifying and assessing the climate-related risks facing our business and determiningresponse measures to those risks.
Corporate Social Responsibility Report 2023Table:Climateriskidenticationandcountermeasures
CategoryRisk AssessmentImpactCountermeasures
Physicalrisks - acuterisks
?Severity of impact:
relatively low?Possibility: likely?Timeframe: short-term
?Extreme weather eventscaused by climate change, suchas torrential rains, typhoonsandoods,mayinterruptelectricity transmission inplants, resulting in water andpower outages, or damageequipment,whichwillreduceproductivity and threatenthe safety of an enterprise’sproperties.
?The Group pays close attention to climatechange trends and formulates contingencyplans for extreme weather according to thecircumstances.?The Group has set up a special action team fortyphoon disaster weather to ensure emergencymaterialreservesandmakeeverye?orttoreduce the impact of typhoons.?Xinxiang Haibin and Jiaozuo Joincare haveestablishedspecialteamsforoodresponsesand Party member taskforce and purchasedadequateoodcontrolmaterials,reinforcingoodresponsecapabilities.
Physicalrisks -chronic risks
?Severity of impact:
relatively low?Possibility:
likely?Timeframe: long-term
?Morefrequentextremelyscorching weather will harmthe health of employees whowork in high temperaturesenvironment.?Rising sea levels reduce theuseful lives of plants andfacilities in coastal areas.
?TheGrouphastakene?ectivemeasuresto prevent heat-related illness. We provideheatstroke prevention grants for employeesworking in the summer and provide intensiveprotection for employees working in hightemperatures and on hot days.?We pay close attention to geo-climaticinformation and cover all our operations withthe “property all risks” insurance.Transitionrisks – policy
and legalrisks
?Severity of impact:
low?Possibility:
likely?Timeframe: short-term
?Regulatoryrequirementsfor environmental protectionare becoming more stringent.Besides, more national andlocal policies have been issuedto limit companies’ carbonemissions.
?The Group is actively adjusting its businessand product structure and gradually reducingthe use of energy-intensive and highly pollutingproductiontechnologiesandequipment.Sustainede?ortsarebeingmadetotryeco-friendly technologies and materials, so as tolimit our carbon emissions.Transition
risks -market risks
?Severity of impact:
low?Possibility:
probable?Timeframe: short-term
?Climate change results inhigher costs of raw materialsand energy consumption forpharmaceutical production,and increasing logistics costs,which threatens the stability ofthe supply chain.
?TheGrouphasidentiedalternativesuppliersof raw materials, key consumables and othermaterials. The Group has also signed strategiccooperation agreements with suppliers of keymaterials, and made plans to incorporate newsuppliers. These measures are taken to ensure astable and consistent supply of materials.Transition
risks-technology
risks
?Severity of impact:
relatively low?Possibility:
possible?Timeframe:
medium-term
?The development of low-carbonequipmentandproduction technologies isfraught with uncertainty.Investments in newtechnologies may fail due toimmature technology and lowmarket recognition.
?When investing in new technologies orintroducingnewequipment,theGroupwillconductsu?cientprojectresearchandfeasibility studies to fully assess the paybackperiod and project feasibility. We will selectthe most appropriate and mature technology toreduce the risk of investment failure.Transition
risks-reputation
risks
?Severity of impact:
relatively low?Possibility:
possible?Timeframe:
medium-term
?As the public pays moreattention to environmentalprotection issues, anenterprise’s failure to respondtoclimatechangewilla?ectthe public opinion of it anddamage its reputation in themarket.
?The Group has set carbon emission targets anddiscloses information on climate change in itscorporate social responsibility reports and theCDPclimatechangequestionnaire.?We have ramped up communication withstakeholders to respond promptly to theirconcerns about our environmental performance.
Timeframes (time over which a risk is expected to materialise): short-term (0-3 years), medium-term (4-10 years), and log-term (morethan 10 years)Possibility (the likelihood that a risk is to materialise): basically certain, probable, likely, possible, unlikely, and very unlikelyImpact (the severity of a risk's impact on business performance): high, relatively high, medium, relatively low, and low
Climate change brings not only risks but also opportunities to our business. With progress made towards the nationalgoals of carbon peaking and carbon neutrality, we have adopted active measures to address climate change. Anaccelerated transition to low-carbon operation can help us get the upper hand in the market competition. We keep abreastof the developments of domestic and international policies on climate change and identify and assess climate-relatedopportunities in terms of three dimensions: resource utilisation rate, clean energy substitution, and market demand.
Table:Climateopportunityidenticationandcountermeasures
Opportunity
Severityof Impact
Impact of OpportunityMeasures to Seize Opportunity
Higher resourceutilisation rate
Medium
?Lower energy and resource consumptioncan reduce emissions and operating costs.?Byadoptingmoree?cientproductiontechnologies, companies can increase theirproduction capacity and revenue whileusingresourcesmoree?ciently.
?The Group actively engages in energyconservation and emission reductionprojects and increasingly invests ingreen production projects. We are ableto continuously improve energy andresourcee?ciency,reducecostsandincreasee?ciencythroughtechnologytransformationandequipmentupgrading.
Increasingproportion ofclean energy
Relativelylow
?Increasing the proportion of clean energycane?ectivelyreducecarbonemissionsand help achieve the Group’s emissionsreduction targets.?Replacing fossil fuels with clean energycan help companies better manage the riskof rising fossil fuel prices in the future.
?The Group plans to accelerate theconstruction of photovoltaic powergeneration projects and gradually increasethe installed photovoltaic capacity andannual photovoltaic power generation.Livzon Group, one of our holdingsubsidiaries, has initiated such projects inthequaliedplantsofallitssubsidiaries,tocontinuouslyimproveitsself-su?ciencyinclean energy.New market
demands
Medium
?Climate change may lead to morechances for human infections andoutbreaksofinuenza,aswellasincreased risk of respiratory diseases,creating new market demands forpharmaceutical companies.
?Closely tracking market demands, theGroup has developed a number of medicinesfor respiratory diseases such as asthma,COPD and bronchiectasis. TG-1000, whichisbeingdevelopedforinuenzaAandB,has entered the phase-3 clinical trial.
?
Severity of impact (the severity of a risk’s impact on business performance): high, relatively high, medium, relatively low, and low
The Group also recognises the importance of climate scenario analysis for climate risk assessment and management. In2023, our holding subsidiary Livzon Group conducted a scenario analysis of its business for the first time. It used theresults of the analysis to assess climate risks and opportunities in order to better predict the impact of potential climaterisks, improve the resilience of its business and identify carbon emission reduction paths.
Corporate Social Responsibility Report 2023
Following the TCFD recommendations and taking into account its business characteristics,Livzon Group conducted a climate scenario analysis in the Shared Socioeconomic Pathways(SSPs) scenarios proposed by the Intergovernmental Panel on Climate Change (IPCC). In 2023,Livzon Group compared two highly comparable climate scenarios, SSP1-2.6 and SSP5-8.5:
?SSP1-2.6 (low emissions scenario): The scenario shows a sustainable society using mainlyclean energy. Under the scenario, all countries have recognised the seriousness of climate changeand have adopted stricter climate policies to reduce emissions. At the same time, technologicalprogress and increased environmental awareness accelerate the transition to a low-carbon andlow-energysociety.Asaresult,theglobalcarbonemissionshavebeensignicantlyreduced.Therise in average global temperatures by 2100 is limited to no more than 2°C above pre-industriallevels.?SSP5-8.5 (high emissions scenario): Under this scenario, the emission path remains unchanged,the global economic development relies on fossil fuels, and greenhouse gas (GHG) emissionscontinue to increase. Over time, as countries stop announcing new climate policies, physical risksfromclimatechangeintensifysharplyandextremeweathereventsaremorefrequentandsevere.The average global temperature rises by more than 4°C above pre-industrial levels by 2100.Under these two climate scenarios, China's GDP per capita will show about 8.9-11.3 timesincrease by 2055 compared to the baseline in 2010. In general, higher GDP will have a positiveimpactonhealthcareneedsandmorepeoplewillexpecthigh-qualitymedicalservicesandmedicines.
The climate scenario analysis of Livzon Group
8.2.3 Risk Management
To proactively respond to the risks and opportunities brought by climate change, the Group has established a robustclimate risk management system. We identify climate risks and opportunities each year, formulate scientific climatechange response plans, and regularly report progress to the CSR Committee of the Board of Directors, which ensures thatclimate-relatedrisksaree?ectivelymanaged.
Case
Our climate risk management steps:
Step 1:
Making a listof potentialclimate risks
?The EHS departments of our subsidiaries collect peer reports, industry research reports,media reports, relevant policies enacted by regulators and other external information anddata. Based on this information as well as stakeholder surveys and internet searches, theydraw up a list of potential climate risks faced by their companies. In the process, otherrelevant business divisions will support the EHS departments by collecting, summarising andsharing information on climate risks faced by their departments.
Step 2:
Determiningassessmentcriteria
?Foreachidentiedclimaterisk,assessfromthefollowingfourdimensions:
(1)Time over which a risk is expected to materialise
(2)The likelihood that a risk is to materialise
(3)Theseverityofarisk’impactonthesubsidiaries’nancialplans
(4)The severity of a risk’ impact on the subsidiaries’ corporate strategies
Step 3:
Scoring by themanagement
?The EHS departments assess and score each risk identified in the 4 dimensions in Step 2.Based on their scores, the risks are ranked from the highest to the lowest and a list of risksby severity is created. The list is submitted to the heads of the relevant business divisions forinitialapprovalandthentothegeneralmanagersofthesubsidiariesfornalapproval.Onceapproved,itbecomesthenalannuallistofrisksofthesubsidiaries.
Step 4:
Determiningresponsemeasures
?The EHS departments determine response measures and set targets based on the risk scoresand discussions with other relevant business divisions. They then hammer out action plans torespond to climate risks, which will be implemented by the relevant business divisions afterapproval by the general managers.Step 5:
Overseeing andreporting
?The relevant business divisions report to their general managers on the implementation ofthe action plans every six months and adapt them in good time to their actual situation.?The subsidiaries prepare annual reports on climate risk management every year. Afterapproval by the general managers, the reports are submitted to the Corporate SocialResponsibility Working Group for review and then to the CSR Committee of the Board ofDirectorsfornalapproval.
8.2.4 Metrics and Targets
The Group’s GHG emissions mainly come from fuel combustion, electricity and purchased steam consumed inproduction and operation. GHG emissions and energy use of Joincare in 2023 are as follows:
Corporate Social Responsibility Report 2023 Table: GHG emissions and energy use of Joincare in 2023
IndicatorUnitAPIsFormulationsTotalDirect GHG emissions (Scope 1)Tonne of CO
equivalents6,988.7155,688.3162,677.0Indirect GHG emissions (Scope 2)Tonne of CO
equivalents578,364.9291,959.0870,323.9Total GHG emissionsTonne of CO
equivalents585,353.6447,647.31,033,000.9 Table: Energy use of Joincare in 2023
IndicatorUnitAPIsFormulationsTotalGasolineLitre194,374.1193,051.4387,425.5DieselLitre230,578.130,544.7261,122.8CoalTonne66,894.5066,894.5LiqueedpetroleumgasTonne1.02.83.7Natural gas10,000 cubic meters795.0298.91,093.9Purchased steamTonne867,473.8738,475.81,605,949.6Purchased electricityMWh859,060.3130,011.1989,071.4In 2022, the Group deliberated and approved the Proposal on Adding Carbon Emission Targets to Joincare’sEnvironmental Management. According to the proposal, we set the carbon emission target of Joincare from 2022 to2055 and commit to achieving carbon peaking by 2028 and carbon neutrality by 2055 (Scope 1 and Scope 2
). In 2023,we took multiple measures to meet our carbon emission targets, including closely monitoring our progress towards ourannual targets, constantly promoting green production, and diligently exploring the potential in energy management. Table: Carbon emission targets of Joincare from 2022 to 2025
YearItemIndicatorTargets2022Carbon emissionEmission per unit production (RMB 10,000)Down 2% from 20212023Carbon emissionEmission per unit production (RMB 10,000)Down 4% from 20212024Carbon emissionEmission per unit production (RMB 10,000)Down 6% from 20212025Carbon emissionEmission per unit production (RMB 10,000)Down 8% from 2021
Scope 1 greenhouse gas (“GHG”) emissions are mainly derived from direct GHG emissions from the consumption of fossil fuels inthe company's operations/production processes (e.g. gasoline, diesel, natural gas, etc.);Scope 2 GHG emissions are mainly derived fromindirect GHG emissions from purchased electricity and steam consumed by the company's operations/production processes.
8.3 Energy Management
The Group takes steady steps to develop the energy management system in strict accordance with laws and regulationssuch as the Energy Conservation Law of the PRC and the Law of the PRC on Promoting Clean Production, based on ISO50001 standards. The production subsidiaries of the Group have established an energy management system based on theiractualities.Theyidentifytheirenergyavailabilitythroughon-siteinvestigation,datavericationandenergydataanalysis,fullyexploittheirenergy-savingpotential,andformulatepracticalmeasuresfore?cientandorderlyenergymanagement. Table: Energy system accreditations of Joincare’s production subsidiaries
Company NameEnergy System AccreditationName of the Energy SystemJiaozuo JoincareAccreditedISO 50001:2018 / RB/T114-2014Xinxiang HaibinAccreditedISO 50001:2018 / RB/T114-2014Haibin PharmaAccreditedISO 50001:2018 / RB/T114-2014Fuzhou FuxingAccreditedISO 50001:2018 / RB/T114-2014Livzon XinbeijiangAccreditedISO 50001:2018 / RB/T114-2014Jiaozuo Livzon AccreditedGB/T23331-2020/ RB/T 114-2014We incorporate the energy management concept into the work processes. In production, we take measures to improveenergy use efficiency for energy conservation and emission reduction. We also increase the investment in greenproduction projects and strive to build a low-carbon and energy-saving green production enterprise. The green productionprojects during this year are as follows:
Table: Green production projects of Joincare in 2023
CompanyName
Project Name
InvestmentAmount
ResultJiaozuoJoincare
Anaerobic biogasreuse
RMB1.79million
Jiaozuo Joincare is currently implementing a biogas reuse project with a capacity of4,000 m?/d. In this project biogas produced in the anaerobic section of the industrialwastewater workshop is purified and used as fuel for RTO regenerative incinerators.The project is now in progress and is expected to meet the fuel needs of the two RTOincinerators of Jiaozuo Joincare and Jiaozuo Livzon. An RTO consumes approximately365,000 m? of natural gas annually. The remaining part, after heating hot water, is usedto replace steam, saving 3,759.5 m? of steam per year.
XinxiangHaibin
Technologicalimprovement ofcirculating pumps
/
Xinxiang Haibin carried out energy-saving technical improvement for circulating pumps.Under an agreement with a third party, the third party provided the energy-saving pumps,andbothpartiessharedtheenergy-savingbenets.In2023,thetwopartiessaved984,744kWh of electricity, including 362,190 kWh at Xinxiang Haibin. About 420 tonnes ofcarbon dioxide emissions was reduced.Energy-savingstreet lamp project
RMB87,500
Xinxiang Haibin purchased and installed 25 explosion-proof solar street lamps.The lamps, with a power of 200W, operated 12 hours a day and saved a total of21,900 kWh of electricity in 2023.LivzonHecheng
Improvementof energyconsumption insewage treatment
RMB870,000
Livzon Hecheng replaced CASS (Cyclic Activated Sludge System) with MBR(membranebioreactor),whiche?ectivelyreducedenergyconsumptioninsewagetreatment. The project is underway and is expected to save 700,000 kWh ofelectricity per year when completed.GutianFuxing
Upgrading ofbiomass boilerfacilities
RMB3million
In 2023, Gutian Fuxing completed the upgrade of its 12 tonnes/hour biomass boilers andboiler exhaust treatment facilities, which have been put into operation. The project saves1,000 tonnes of coal each year.
Corporate Social Responsibility Report 2023
8.4 Emission Management
Joincare abides by national and local laws and regulations such as the Law of the People’s Republic of China onEnvironmental Impact Assessment, the Law of the People’s Republic of China on Prevention and Control of SoilContamination, the Law of the People’s Republic of China on the Prevention and Control of Air Pollution and theRegulations on the Safety Management of Hazardous Chemicals. We strictly control emissions and perform ourenvironmental protection responsibilities.We have formulated policies such as the Safety and Environmental Management Manual and the EnvironmentalProtection Management Assessment System in light of our own operating conditions. We also revised our environmentalmanagement policies in 2023, including the Hazardous Waste Management Policy, the VOCs Collection andManagementSystem,andtheManagementPolicyforProductionWastewaterDischarge.Basedonthis,theclassicationmethod, monitoring method, disposal process and emission standard of all emissions are specified. This ensuresthat emission management is based on unified systems and standards. We strive to build a green production line forsustainable development.In addition, the pollutant emission is under our control throughout the production process. All production subsidiariesof the Group have applied for a sewage discharge permit in accordance with the law on the unified national platform.Afterobtainingthepermit,theydischargeinstrictaccordancewiththerequirementswithinthevalidityperiodandfirmly ensure the compliance of pollutant emission. Furthermore, we have formulated a self-monitoring plan based ontheenvironmentalimpactassessmentrequirementsandsewagedischargepermits.Wehirequalifiedthird-partytestingagencies to monitor our waste gas, wastewater and noise regularly. Based on the monitoring results, we conduct self-inspection and correction of non-standard behaviours, and strive to minimise the negative impact of our production on theenvironment,aspartofourenvironmentalprotectione?orts.
8.4.1 Waste Gas Management
Joincare devotes ongoing efforts to the management of waste gas emissions in accordance with laws and regulations,including the Law of the PRC on the Prevention and Control of Air Pollution. We have formulated and implementedwaste gas management policies such as the VOCs Management System for Collection and Treatment, the Boiler WasteGas Emission Management System, and the Standard Operating Procedures for High-concentration Waste Gas TreatmentSystems.Thepoliciesrequireallproductionsubsidiariestostandardisethemanagementprocessandensurethewastegas emission is up to standard. The production subsidiaries of the Group strictly implement waste gas management andtakee?ectivemeasurestominimisetheimpactofwastegasemissionsontheenvironmentbasedontheiractualities.Forexample:
? Digital monitoring and manual detection of waste gas: The production subsidiaries have installed online monitoringequipmentfororganisedwastegasemissionsanddetectionequipmentforfugitivewastegasemissionsforteal-timemonitoring of the waste gas pollution factors. Data is uploaded to the automatic national monitoring and basic databasesystem for key pollution sources in real-time. Meanwhile, these subsidiaries conduct manual detection of organisedandfugitivewastegasemissionseachquarterpursuanttotherequirementsofthewastedischargepermitandtheirself-monitoringplans.Thispracticeaimstoadvancee?cientmanagementoftheemissions.
? Daily inspection and feedback of waste gas concentration detection: In the daily inspection of environmental
protection, the production subsidiaries check the concentration detection of environmental pollutants in their productionareas, the concentration detection of environmental pollutants in key areas, the leakage problems in the production areas,and the operating status of the waste gas collection and treatment facilities. In addition, they report the concentration ofenvironmental pollutants within the scope of their factories to the production units, demand that the items that do notmeettherequirementsbecorrectedinatimelymanner,andrecordtheitemsthatviolatetheenvironmentalmanagementpolicy and punish those responsible.
? Strengthening waste gas management capabilities: The production subsidiaries will conduct professional and technicaltraining for the relevant waste gas management personnel in order to improve their professional skills. At the sametime,theproductionsubsidiariesacquirereal-timeupdatesontheprogressofeachproductionstepbyconsistentlystrengthening communication between the waste gas treatment departments and the production departments.To reduce harmful emissions from our operations, we carry out group-wide projects of emissions managementimprovement every year. Each Joincare’s production subsidiary continues to increase its investments in waste gasmanagement and have achieved effective management of waste gas emissions by upgrading waste gas treatmentequipmentandprocess.
Joincare Pharmaceutical Group Industry Co., Ltd. Table: Major waste gas management and improvement projects of Joincare in 2023
Company NameProject NameResult
Haibin Pharma
Upgradingof waste gastreatmentino?-site workshops
Haibin Pharma installed 1 waste gas treatment membrane system, 1pretreatment facility, 1 set of three-in-one drug filter washing dryer, 2vacuum pumps, and 2 condensers for centralised recycling of waste gas.ThisprojectcreatesanannualbenetofRMB1million.WastegastreatedislledintheRTOsystemforre-treatment,realisingultra-lowemissions.The project not only brings economic benefits to the company, but alsoreduces the safety risks associated with treating high-concentrations wastegas.
Xinxiang Haibin
Pretreatmentfor waste gastreatment
To reduce the inlet concentration in the RTO system and eliminatethe effect of fine dust in waste gas on the RTO combustion process,Xinxiang Haibin installed 1 spray tower and 2 spray pumps for waste gaspretreatment.Improvement ofVOC emissions
In 2023, Xinxiang Haibin replaced the flat centrifuge in the No.3workshop with a three-in-one device, which lessened the open operationsand further reduced the fugitive VOC emissions from the No. 3 workshop.The VOC concentration in the open feeding operation in the workshop hasbeen lowered from the original 50 mg/m? to around 10 mg/m?, which isexpected to reduce the fugitive VOC emissions by 0.5 tonnes per year.Improvement offugitive waste gasemissions
Xinxiang Haibin built a new solvent tank farm and substituted cannedsolvents for barreled solvents. This upgrade realised automatic materialinput, resulting in lower safety risk, and reduced open operations andfugitive emissions. It is expected to reduce fugitive waste gas emissionsby 2.59 tonnes annually.NingxiaPharmaceutical
Waste gas reuse
In 2023, Ningxia Pharmaceutical launched technical exchanges andcooperationwithcompaniesqualifiedinexhaustgasrecycling.Theyused the membrane-based recovery process to recover the acetone tailgas produced by the company’s production line for API refining. Therecoveryratecanbeashighasmorethan90%,e?ectivelyreducingVOCemissions.
Livzon Hecheng
Renewal of wastegasequipment
?Livzon Hecheng added an RTO set, greatly improving the VOCprocessing efficiency and reducing the VOC emission concentration bymore than 85%.?The company replaced an 8 t/h ultra-low nitrogen natural gas boiler,reducing the concentration of nitrogen oxide emissions by 80%.?Thecompanyinstalledtheliquidnitrogencryogenictreatmentandrecovery facilities for the waste gas produced by the refinery workshop.Thesefacilitiesusetheplant’sliquidnitrogencoolingcapacitytocondense and recover acetone and ethanol. The ongoing project isexpected to recover 140 tonnes of acetone and ethanol per year, whichwill not only reduce exhaust emissions but also improve solvent recovery.
Corporate Social Responsibility Report 2023 Table: Emissions of main waste gases of Joincare in 2023
IndicatorUnitAPIsFormulationsTotalVolatile organic compoundsTonne65.63.569.0Nitrogen oxideTonne85.54.690.1Sulfur dioxideTonne34.30.334.6ParticulatesTonne13.52.516.0
8.4.2 Wastewater Management
According to laws and regulations such as the Water Law of the PRC and the Water Pollution Prevention and ControlLaw of the PRC, Joincare has established the wastewater management system and formulated a series of standardoperatingprocedures.Byinstallingonlinewastewatermonitoringequipmentattheeffluentoutletsofmajorwastewaterdischarge plants and networking with regulatory authorities, we monitor and share real-time chemical oxygen demand(COD), ammonia nitrogen, total nitrogen, total phosphorus and other discharge data of treated wastewater, and urgeall the production subsidiaries to meet the set standards for wastewater treatment and discharge. We regularly inspectandmaintainthewastewatertreatmentandmonitoringequipmenttoensurethestableandefficientoperationofthewastewatertreatmentsystem.TheproductionsubsidiariesoftheGroupalsoupgradetheprocessesandequipmentthatproduce wastewater and strive to reduce the discharge of wastewater.At the same time, we conduct regular training for operators of the wastewater treatment system and at the sewagestations to improve their management awareness and professional skills and to ensure that wastewater management runssmoothly.In2023,theEHSpersonnelfromourheadquartersprovidedon-siteassistancetoXinxiangHaibininupgradingthe anaerobic section of sewage treatment and converting organic pollutants into biogas for recycling and reuse, therebyeasingtheburdenonthesubsequentbiochemicalsewagetreatment.To reduce the environmental impact of wastewater from our operations, we carry out group-wide wastewatermanagement improvement projects every year. We decrease wastewater discharge, increase wastewater utilisation,and reduce the concentration of pollutants in wastewater by improving wastewater treatment processes and upgradingwastewater treatment facilities. In this way, we continue to explore the potential for better wastewater management. Atthe same time, we continue to track and review the progress of wastewater management improvement projects and thee?ectivenessoftreatmenttoensurethatoure?ortstoreduceandmanagewastewateremissionsarefruitful. Table: Major wastewater management and enhancement projects of Joincare in 2023
CompanyName
Project NameResultXinxiangHaibin
Pretreatmentof productionwastewater
Xinxiang Haibin added two sets of wastewater distillation, recovery andpretreatment facilities to recover n-octane and ethanol from productionwastewater. This not only improves the solvent recycling rate, but alsoensures the stable operation of the environmental protection facilities insubsequentprocesses,generatingabenetofRMB1.5millioneachyear.GutianFuxing
Upgrade ofsewage treatmentfacilities
In the year, Gutian Fuxing built a new membrane treatment plant for high-ammonia nitrogen wastewater to pretreat such wastewater and protect thetreatment efficiency of its wastewater treatment facilities from declining duetotheimpactofhigh-concentrationwastewater.Thisensuresthee?cientandstable operation of the wastewater treatment facilities.LivzonLimin
Waste alcoholreuse
In the year, following the guidance of the Demonstration Report onComprehensive Utilisation of Waste Alcohol, Livzon Limin recycled wastealcohol to the wastewater treatment plant and used it as a supplementarycarbon source, thus improving the recycling rate of waste alcohol.
Table: Main wastewater and pollutant emissions of Joincare in 2023
IndicatorUnitAPIsFormulationsTotalWastewater emissionTonne10,977,349.21,114,799.812,092,149.0Chemical oxygen demandTonne968.426.7995.2Ammonia NitrogenTonne112.01.7113.6
8.4.3 Solid Waste Management
Joincare stores, collects, disposes and transports wastes in strict accordance with the standards and regulations suchas the Catalogue of Classified Management of Discharge Permits for Stationary Pollution Sources and the Standardfor Pollution Control on the Non-hazardous Industrial Solid Waste Storage and Disposal Facility. Therefore, legalcompliance is ensured in solid waste treatment. For hazardous waste, under the manifest system for transfer of hazardouswaste,wetransferallsuchwasteweproducetoqualifiedcompaniesforrule-baseddisposal.Andwedelivernon-hazardouswastetoqualiedentitieswithwhomwehavesigncontractsforsafedisposal.Adhering to the principles of Reduction, Resource Utilisation, and Harmless Processing, we strictly control thedischarge of solid waste in waste generation, reuse and harmless disposal links, with the aim of reducing our impacton the environment. At the same time, the Group has set solid waste disposal targets, which have been allocated to allsubsidiaries.Thesubsidiariesarerequiredtoachieveadisposalrateof100%.In2023,allsubsidiariesachievedtheirsolid waste disposal targets.To reduce waste discharge from our operations, we carry out group-wide waste management improvement projects everyyear. We classify waste to improve treatment efficiency, and actively promote waste reduction, recycling and harmlessdisposal by introducing advanced environmental protection technology into production, upgrading original productiontechnologyandformulations,andcooperatingwiththirdparties.Wearemonitoringtheoperationandtreatmente?ectsofsolidwastemanagementimprovementprojectstoensurethatoure?ortstoreducewastedischargearee?ective.
CompanyName
Project NameResult
JiaozuoLivzon
Technicaltransformation
Duringtheyear,JiaozuoLivzonaddedthepretreatmentprocessforuoride-containing wastewater. It added potassium chloride to the wastewater toreduce the level of fluoroborate and decrease the discharge of fluoride,thereby relieving the impact of fluorine-containing wastewater on the entiresewage treatment system.Triethylaminerecycling
In the year, Jiaozuo Livzon initiated a triethylamine raw material recyclingproject. This project was expected to recycle 157 tonnes of triethylamineevery year, with a reuse rate of 58%. This has effectively lowered the CODconcentration in wastewater discharged and mitigated the environmentalimpact of its production activities.SichuanGuangda
Technicaltransformation
Taking into account the different COD concentrations of wastewater,Sichuan Guangda built high- and low-concentration collection tanks tocollect wastewater with different COD concentrations separately. This hase?ectivelymitigatedtheimpactofdirectdischargeofhigh-CODwastewaterinto the sewer system.
Corporate Social Responsibility Report 2023 Table: Major solid waste management and improvement projects of Joincare in 2023
Company NameProject NameResult
Xinxiang Haibin
Technologicaltransformation ofhazardous wastetreatment
In 2023, Xinxiang Haibin invested RMB1.50 million in the technicaltransformationoftheMVRandmotherliquorconcentrationprocessesforitshigh-saltwastewatertreatmentequipment.Inthepast,thehigh-salt wastewater from the workshops, after the mixed treatment,contained a large amount of hazardous solid waste. After the technicaltransformation, the company treats the wastewater separately. Part ofthe wastewater goes directly to the evaporation boiler for evaporationand concentration, and is then mixed after the testing, reducingthe production of hazardous waste by 40%. As a result, the annualproduction of hazardous solid waste can be reduced by more than 500tonnes.NingxiaPharmaceutical
Waste reuse
In 2023, in cooperation with third parties, Ningxia Pharmaceuticalcompleted the experiment of reusing boiler slag and sludge asconstruction raw materials, transforming the slag and sludge intoresources.
Fuzhou Fuxing
R&D of fungiresidue reductionand recyclingtechnology
In 2021, Fuzhou Fuxing cooperated with South China University ofTechnology in research and development of reduction and recyclingof fungi residues. By improving the flocculant and adding low-temperaturedryingequipment,thereductionrateoffungiresidueperunit of product has been steadily controlled at over 60%. In 2023,the project operated stably and saved disposal costs of about RMB1million or more, achieving the expected results.Optimisinglterpressinginhazardous wastedisposal
In 2022, Fuzhou Fuxing optimised the flocculant formulation in filterpressing in hazardous waste disposal and added the low-temperaturedrying facilities, reducing solid waste by more than 60% and savingdisposal costs of about RMB1 million. As at the end of the reportingperiod, the project was under implementation.Gutian Fuxing
Upgrade of sludgepress system
After the upgrade project was completed in 2021, the moisturecontent of Gutian Fuxing’s sludge was down from 85% to 60%. Thise?ectivelyreducesthesludgeproductionandavoidsproblemssuchasdripping due to high moisture content during sludge transport.
Table: Waste treatment of Joincare in 2023
IndicatorUnitAPIsFormulationsTotalGeneral industrial wasteTonne120,211.821,327.3141,539.1Hazardous WastesTonne6,476.7407.56,884.2Among which: Pharmaceuticalwaste and waste medicines
Tonne3,546.3245.93,792.2Other hazardous wasteTonne2,930.4161.63,092.0
8.5 Resource Utilisation Management
Adhering to the concept of sustainable development in the whole process of production and operations, Joincareconsistently strengthens resource use management and practices the concept of green development. We abide by theWater Law of the PRC, the Circular Economy Promotion Law of the PRC, and other relevant laws and regulations. Wehaveimplementedstringentmanagementrequirementsforwaterresourcesandmaterials.Wealsopromotestandardisedand systematic management measures, and work hard to improve resource utilisation rate in production and operations.
8.5.1 Water Management
At Joincare, we attach great importance to water management. To conserve water and reduce water consumption, weimplement a strict water management policy and carry out group-wide water management improvement projects.All our production subsidiaries are actively introducing and using advanced technologies and processes to conservewaterandimprovewateruseefficiency.Wearestrengtheningthemaintenanceofvariouswater-consumingequipmentand facilities, investing in water resource recycling projects, and promoting the recycling of reclaimed water and coolingwater.Thesee?ortsaimtoreducefreshwaterconsumptionandimprovethereuserateofwaterresources.
In 2023, Xinxiang Haibin invested RMB 350,000to build a soundproof room with acoustic panelsand closed the door and windows of the roomto best soundproof the refrigeration machines.The measured noise levels have met the noisestandards for production workshops andworkplaces of industrial companies.
Noise reduction of refrigeration machines by Xinxiang Haibin
8.4.4 Noise Management
Joincare strictly abides by the Environmental Noise Pollution Prevention and Control Law of the PRC, EnvironmentalNoiseEmissionStandardsforIndustrialEnterprisesBoundary,andotherrelevantlawsandregulations.Weequiptheproduction subsidiaries with noise detectors and test the noise at the plant boundary every month to ensure that the noiseduring daytime/night is lower than the national emission limits. The production subsidiaries also actively optimise theirproductionequipment,andtrytoreducetheimpactofproductionnoiseontheenvironmentbyaddingsoundproofhousesandnitrogengeneratormu?ers.
Case
Noise Reduction Project of RefrigerationMachines by Xinxiang Haibin
Corporate Social Responsibility Report 2023
Table: Major water-saving projects of Joincare in 2023
CompanyName
Project Name
Investment
Amount
Result
JiaozuoJoincare
Recyclingandutilisationof reclaimedwater
RMB4 million
After repeated testing, analysis, and experimental verification,Jiaozuo Joincare succeeded in recycling the water from the level-3sedimentation tanks in the industrial wastewater workshops and thepickling wastewater from the refining plants. Through combinedtreatment, including classified collection, sedimentation andfiltration, composite filtration, thorough removal of contaminantsand secondary treatment with reverse osmosis membranes, thewastewater meets the standard for reuse. The project put into trialoperation in March 2024. When completed, it will be able to recycleabout 2,400 m? of water from the level-3 sedimentation tanks and1,400 m? of pickling wastewater per day, achieving a recycling rateof 79% and reducing the daily wastewater volume by about 3,000m?.XinxiangHaibin
Steamcondensatereuse
RMB300,000
Xinxiang Haibin launched a steam condensate reuse project, usingsteam condensate for domestic use and irrigation. This saves 10,000tonnes of water every year.JiaozuoLivzon
Steamcondensatecollectionand reuse
RMB36,000
Jiaozuo Livzon launched a project of collecting and reusing steamcondensate in the workshop. All steam condensate was reused orused as domestic water for employees, reducing the consumptionof purchased tap water. The project can save 3,000 tonnes of waterevery year.LivzonHecheng
Water reusewith storagetanks andwater pumps
RMB40,000
Livzon Hecheng installed storage tanks, heat exchangers, and waterpumps and piping to return water to the storage tanks during spraycooling. After the water was cooled by the heat exchangers, it waspumped to the roof of the tank farm for cooling, thereby improvingthe utilisation of water resources. This can save 9,000 tonnes ofwater per year. Table: Water resources usage of Joincare in 2023
IndicatorUnitAPIsFormulationsTotalTotal waterconsumption
10,000 tonnes1,201.2225.31,426.5
8.5.2 Material Utilisation Management
Joincare takes positive steps to implement the resource recycling policy and optimise material management for higherresourceutilisatione?ciency.We optimise the layout of the storage area. The packaging materials and excipients are stored by area, layer and categoryto save storage space. We optimise the material transportation route to improve the utilisation of elevators and theefficiency of internal material transportation. In addition, we have improved the product packaging design and productspecifications, and have been recycling consumables such as corner strips and packing belts used for packaging thenishedproducts.
8.6 Biodiversity Conservation
Business sustainability is inextricably linked to ecosystem health. Joincare pays great attention to the impact of itsoperations on biodiversity. We comply with the Law of the PRC on Prevention and Control of Soil Contamination, theForestry Law of the PRC, the Law of the PRC on the Protection of Wildlife, the Regulations on Conversion of Farmlandto Forests, the Opinions on Further Strengthening Biodiversity Protection, and other relevant laws and regulations. Wealso actively implement the UN Convention on Biological Diversity and promote biodiversity in many ways. We wouldidentify environmental risk factors and hidden hazards before building factories. We meet the “ecological red lines”requirementsandavoidoperatinginareasofhighbiodiversityvalue,suchasthoseclosetogovernment-designatedecological reserves. At the same time, we encourage our production subsidiaries to conduct biodiversity assessmentsrelevant to their operations to help protect endangered species and promote ecosystem balance.During the year, Joincare had no production facilities or operational sites located within ecological reserves or areasof high biodiversity value. None of the Group’s production activities, products or services had a significant impact onbiodiversity.
In 2023, Haibin Pharma invested RMB 1 millionin off-site workshops to build four storage roomsfor solid materials and barreled materials, with atotalareaof800squaremetres.Thesupportingfacilities include the air supply system, groundprotector, leakage collection basin, electrostaticdischargeequipmentandthelike.Theywillhelp to reduce the safety risks and dust pollutioncaused by materials stacked in the open air andensure that materials are stored in a safer and moreenvironmentally friendly way.
In 2023, Xinxiang Haibin invested about RMB
12.1558 million, to build a new solvent tank farm.
The barreled solvent was changed to cannedsolvent to reduce the production of fugitive wastegas emissions and packaging waste, saving 38tonnes of iron drums and 8 tonnes of plasticpackaging each year.
BarreledmaterialstorageroomsatHaibinPharma’so?-siteworkshops
The new solvent tank farm of Xinxiang Haibin
Case
Barreled Material Storage Rooms at HaibinPharma’sO?-siteWorkshops
The New Solvent Tank Farm of Xinxiang
Haibin
Corporate Social Responsibility Report 2023
As a responsible enterprise, Joincare continues to pay attention to social needs in addition to its own business development.We actively participate in charitable and public welfare projects to create a better world with virtue. Relying on our businessand technical advantages, we aspire to build a harmonious society. We take practical actions to support the healthy, green andsustainable development of the whole society. Specifically, we participate in industry exchanges, continuously promote the“Access to Public Welfare for Chronic Diseases Prevention and Treatment Programme” and rural industrial assistance projects,and organise a variety of health and public welfare activities for the public, to support the healthy, green and sustainabledevelopment for the whole society with practical actions.
SDGs in this section
Public Welfare and
Charity
9.1 Promoting Industry-Based Welfare
Joincare strives to be a pioneer in the healthcare industry. We actively participate in exchanges and cooperation withindustry associations and societies on cutting-edge industry technologies and trends, to promote the sustainabledevelopmentoftheindustrythroughjointe?orts. Table:Associations Joined by Joincare
No.Associations1Medical and Chemicals Technical Options Committee (MCTOC)2Guangdong Pharmaceutical Industry Association3Guangdong Bio-Pharmaceutical Innovation Technology Association4Shenzhen Biomedical Industry Alliance5Shenzhen Life Science and Biotechnology Association6China Pharmaceutical Industry Association
Professional Committee of Drug Manufacturing Quality Authorised Person of Guangdong
Pharmaceutical Association8China Nutrition and Health Food Association9China Health Care Association10Guangdong Food Safety Society11Guangdong IP Protection Association12Guangdong Forensic Science Association13Shenzhen Forensic Science AssociationDr. Jin Fang, the Chief Scientist of the Group, attended a number of international conferences as a member of Medicaland Chemicals Technical Options Committee (MCTOC) under the United Nations, focusing on research and reportingrelated to MDI inhaler propellant substitution. As a subordinate institution of Technology and Economic AssessmentPanel (TEAP), MCTOC conducts science and technology evaluation on materials that deplete the ozone layer andtheir alternatives in alliance with the other Technical Options Committees (TOCs). Based on this, MCTOC providessuggestions to parties who signed the Montreal Protocol, thus contributing to the fulfilment the obligations of MontrealProtocolworldwide.TheprocessesofR&D,production,andqualitycontrolofinhalationformulations,whichisaahigh-enddosageform,have relatively large difference when compared to regular oral or injectable formulations. As a member of the ChinesePharmacopoeia Commission, Dr Jin Fang leads the research project Revision of the General Rules for 0111 InhalationFormulations for the revision of national drug standards. To further improve the on-site inspections of inhalationformulationss, Joincare took part in the compilation of the Guideline for On-site Inspection of Inhalation Formulations.The compilation was led by Guangzhou Institute of Respiratory Health and approved by Centre for Food and DrugInspectionofNMPA.Theguideline,whichwaso?ciallylaunchedon6March2023,canhelponsiteinspectorsidentifytheriskcontrolpointsofinhalationformulations,conducteffectiveinspection,andensurethequalityandsafetyofinhalation formulations.
9.2 Promoting Health-Based Welfare and Charity
Rooted in the healthcare industry, Joincare continues to do its part in inclusive chronic disease prevention and treatment,industrialassistance,communityhealthandearthquakerelief,strivingtobuildahealthyandharmonioussociety.In2023,Joincare donated about RMB 25,985 thousand to public welfare projects, including cash of nearly RMB 19,762 thousandand goods worth about RMB 6,223 thousand.
Corporate Social Responsibility Report 2023
9.2.1 Rural Revitalisation
Chronic Disease Prevention and Treatment
In response to the national strategy of rural revitalisation and common prosperity, Joincare, joined hands with the Group’sholding subsidiary Livzon Group to carry on the long-term drug donation programme - “Access to Public Welfare forChronic Diseases Prevention and Treatment Programme”. We provided long-term assistance to patients with financialdifficulties in remote areas who suffer from chronic diseases, such as hypertension, hyperlipidemia, cardiocerebraldiseasesandgastricdiseases.Wedonatedvedrugsfortreatingchronicdiseases,includingPravastatinCapsules(普伐他汀钠胶囊), Amlodipine Besylate Capsules (苯磺酸氨氯地平胶囊), Valsartan Capsules (缬沙坦胶囊), IsosorbideMononitrate Tablets (单硝酸异山梨酯片) and Bismuth Potassium Citrate Tablets (枸橼酸铋钾片), to reduce themedical burden of chronic diseases on poor families and prevent patients from sinking back into poverty due to illness. Atthe same time, we actively carry out health-related and education-based public welfare activities to help chronic diseasepatients improve the knowledge in the prevention and control of chronic diseases and health management.Since late 2018 onwards, we have carried out the “Access to Public Welfare for Chronic Diseases Prevention andTreatment Programme” successively in areas including Chaotian District, Guangyuan City, Sichuan Province; SongpanCounty, Aba Zang Qiang Autonomous Prefecture, Sichuan Province; Jinkouhe District, Jiange and Pingwu Counties,LeshanCity,SichuanProvince;Hunyuan,GuanglingandLingqiuCounties,DatongCity,ShanxiProvince;Dongxiang,Tianzhu, Linze, Shandan and Huining Counties, Gansu Province; Xianghai National Nature Reserve, Jilin Province;Chayu County, Tibet Autonomous Region; Macun District, Jiaozuo City, Henan Province; Huangshan District,Huangshan City, Anhui Province; Suining County, Hunan Province; Fenyi County, Jiangxi Province; Kashgar, XinjiangUygur Autonomous Region; Baarin Left Banner and Togtoh County, Inner Mongolia Autonomous Region; and ZiyuanCounty, Guangxi Zhuang Autonomous Region. These are part of our efforts to benefit the public, protect the health ofrural residents, revitalise rural areas, and build a beautiful and healthy China.
Programme on Chronic Diseases inBaarin Left Banner, Inner Mongolia
Programme on Chronic Diseases in Huining County, Gansu Province
Programme on Chronic Diseases in Ziyuan County, Guangxi
By the end of the reporting period, we had signed 26 agreements on the “Access to Public Welfare for ChronicDiseases Prevention and Treatment Programme”, which covers 8 provinces and 4 autonomous regions, including 23remote areas in need of aid, and benefiting 19,410 low-income patients with chronic diseases. In 2023, we donatedRMB 1 million worth of chronic disease medicines to low-income patients in each of the following regions:
? In April 2023, the Group donated RMB 1 million worth of medicines to Kashgar, Xinjiang Uygur Autonomous Region;? In June 2023, the Group donated RMB 1 million worth of medicines to Huining County, Gansu Province;? In July 2023, the Group donated RMB 1 million worth of medicines to Baarin Left Banner, Inner Mongolia Autonomous Region;? In July 2023, the Group donated RMB 1 million worth of medicines to Ziyuan County, Guangxi Zhuang Autonomous Region;? In September 2023, the Group donated RMB 1 million worth of medicines to Jinkouhe District, Leshan City, Sichuan Province;? In October 2023, the Group donated RMB 1 million worth of medicines to Shandan County, Gansu Province; and? In October 2023, the Group donated RMB 1 million worth of medicines to Togtoh County, Inner Mongolia AutonomousRegion.
Jinkouhe District of Leshan City, located in the southwest of Sichuan Province and north of theXiaoliang Mountain, was designated as a “Targeted Assistance County for Rural Revitalisationin Sichuan Province” in 2021. In September 2023, Joincare and its holding subsidiary LivzonGroup launched the “Rural Revitalisation: Programme on Chronic Diseases” in Jinkouhe District,donating RMB 1 million worth of medicines to the local Red Cross. The donated medicineswill be used free of charge by the District People’s Hospital to treat local low-income patientswith chronic diseases, reducing their financial burden and life difficulties caused by long-termmedication. This will further improve the health of local people and inject impetus to the localhealth cause.
Case: “Rural Revitalisation: Programme on Chronic Diseases” inJinkouhe District, Sichuan Province
Case
“Rural Revitalisation: Programme on Chronic Diseases” in Jinkouhe District, Sichuan Province
Corporate Social Responsibility Report 2023
During the year, the “Access to Public Welfare for Chronic Diseases Prevention and Treatment Programme” was highlyrecognised and awarded as “2023 ‘CSR Competitiveness’ Responsibility Typical Cases of ‘Contribution Enterprises in RuralRevitalisation’” by the China Business Journal and “Excellent Practice Cases of Listed Companies in Rural Revitalisation”by the China Association for Public Companies. These accolades demonstrate the high recognition and appreciation receivedfrom external organizations
China Business Journal2023 “CSR Competitiveness” Responsibility Typical Cases of
“Contribution Enterprises in Rural Revitalisation”
China Association for Public CompaniesExcellent Practice Cases of Listed Companies
in Rural RevitalisationIndustry-Based AssistanceTo consolidate and expand the achievements in poverty alleviation, the Group provides industry-based assistance toempower the sustainable development of the rural economy using its industrial advantages. Following the “AstragalusRoot (黃芪) Industry Revitalisation” plan and the model of “Company + Base” and “Company + ProfessionalCooperative”, Joincare’s holding subsidiary Livzon Group works to make the astragalus root industry a pillar industry inthe long-term with reference to the local conditions.
Since 2017, Livzon Group has been implementing the “Astragalus Root Industry Revitalisation” project.It has built astragalus root planting bases in Hunyuan County, Datong City, Shanxi Province and ZizhouCounty, Yulin City, Shaanxi Province. In 2023, Livzon Group re-signed the astragalus root planting base co-construction agreements with 12 cooperatives in Hunyuan, Tianzhen and Yanggao Counties, Datong City,Shanxi Province and Yulin City, Shaanxi Province, to build bases of about 20,000 mu. The project has helpedintotalof415peoplesince2017,e?ectivelyboostingtheeconomicdevelopmentofrelevantruralareas.In addition, Livzon Group and the village committee of Mazhuang Village, Guaner Township, HunyuanCounty, Datong City, Shanxi Province jointly launched the “Co-construction between County and Corporate”project to repair and upgrade the factory for primary processing of fresh astragalus root. The project aimstorepairandrenovatetheprimaryprocessingfactorytomeettherequirementsofprimaryprocessingandstorage of astragalus root. At the same time, Livzon Group provided GAP training for about 30 managers andlocal farmers of the base in Zizhou County, Yulin City, Shaanxi Province in accordance with the new GoodAgricultural Practice for Chinese Herbal Medicine. It also conducted practical training on the traceability ofChinese herbal medicine to improve the professional competence of managers.
Industry-based assistance to promote the development of the astragalus root industry by Livzon GroupCase
9.2.2 Community Health
Joincare commits itself to organising health-related and education-based public welfare activities through variouschannels, including videos, expert live broadcasts, lectures and free clinics. Through this kind of interesting and livelypopularisation, we aim to enhance the public’s health awareness.Oral Health Education
“1018” World Menopause Day Activities
Know More about Menopause
To raise public awareness of oral health, Joincare, in collaborationwith Peking Union Medical College Hospital and Peking UniversitySchool and Hospital of Stomatology, conducted 22 online lectureson oral health and invited 123 doctors to release a total of 169promotion videos. These efforts reached nearly 700 million people,strengthening public attention to oral health.
On 18 October 2023, Joincare launched a series of online andoffline menopause care activities. We shared the secrets to livingwith menopause through a variety of innovative activities, includingthe release of online videos, offline collaborations with nationalpharmacy chains, bus tour and yoga.
Joincare is committed to correcting public perception of menopausalsymptoms and working with expert doctors to spread menopausalhealth knowledge to the public through social media. In 2023,Joincare worked with 24 professional doctors to produce 28 popularscience articles, which were viewed by over 50 million people.
Experts’ View on MenopauseJoincare launched a professional menopause column, ExpertView on Menopause, which has a total of 150 thousandsubscribers. By the end of the reporting period, we hadcooperated with 47 medical experts and dietitians in variousfields to organise 62 live sessions and 3 offline lectures,covering more than 100,000 viewers from a number ofprovinces across the country.
Oral Health Education
Menopause Knowledge Promotion Video
“1018” World Menopause Day Activities
Expert View on Menopause
Corporate Social Responsibility Report 2023
Melasma is a skin disease with increasedpigmentation, usually found on the face. Onaverage, 1 in 3 women of childbearing age in thecountrysu?erfrommelasma.Toeducatethepublicabout the symptoms and treatment of melasma,Joincare and the authoritative media Xinhua jointlylaunched the “Inner Nourishment for Beauty,Nurturing Eastern Elegance” activity to explainhow to properly remove melasma. The activity wasviewed over 100 million times and attracted morethan 850,000 participants, promoting the cultureof traditional Chinese medicine while popularisinghealth knowledge.
In cooperation with the Respiratory Society of Jiangsu Medical Association, Nanjing Drum TowerHospital and 18 Grade-A tertiary hospitals in Nanjing, the Group launched a large-scale free clinicon World Chronic Obstructive Pulmonary Disease (COPD) Day in November 2023. A wide rangeof online and offline activities were carried out on the exclusive platform, “Respiratory Experts'Views”. Adhering to the principle of “public welfare for the good, and knowledge for the people”, wehope to do a good job of educating the public on respiratory diseases with partners from all walks oflife. In this way, COPD can be understood and recognised by more people. We also aim to establisha coordinated system for the prevention and control of respiratory diseases throughout society,promoting the early prevention, screening, diagnosis and treatment of COPD to safeguard publichealth.On the day of the activity, 100 people attended the on-site lecture, 300 people received freeconsultations, and over 250,000 viewers watched the live broadcast of the event online. This activityreceived on-site coverage fromby the provincial media in Jiangsu Province and received unanimouspraise from the participants.
“Inner Nourishment for Beauty, Nurturing Eastern Elegance” - Melasma removalScience Campaign
World COPD Day: prevention and treatment of chronic respiratory diseaseswith “Respiratory Experts' Views”
Case
Large-Scale Free Clinic on World COPD Day
“Inner Nourishment for Beauty, Nurturing EasternElegance” - Melasma Removal Science Campaign
9.2.3EarthquakeRelief
Joincareisconcernedaboutthehealthandsafetyofthepublic,andiscommittedtohelpingpeopleinneedandfulllingitscorporatesocialresponsibility.InDecember2023,a6.2magnitudeearthquakestruckJishishanCounty,LinxiaHui Autonomous Prefecture, Gansu Province, causing severe impacts on the local economy and society. The Grouprespondedquicklytotheearthquakebyprovidingreliefandassistancetothepeopleinthea?ectedareas.Togetherwithour holding subsidiary Livzon Group, we donated a total of RMB 20 million in relief funds and medical supplies to thea?ectedareas.Wecontributedtotheemergencyrelief,resettlementofthea?ectedpeople,supportforrescueteamsandpost-disasterreconstructiontohelppeoplethroughthedi?culttimes.
JoincareEarthquakeReliefinGansu
9.3 Involvement in Public Welfare
In addition to leveraging its industrial advantages for public health, Joincare acts in line with the corporate culture of“Caring for people, Practicing public welfare”. In May 2023, we set up a volunteer team and called on more than 200employees to join the team. Volunteer activities were carried out in a variety of areas such as environmental protection,public health, and rural revitalisation.
Corporate Social Responsibility Report 2023
Caring for Children with AutismChildren’s physical and mental health should be a concern for all people. In November 2023, our volunteer teamparticipated in the “5km Fun Run for Children of the Stars” to encourage children with autism and their families to takepart in outdoor sports and enjoy the fun with the company of volunteers. We hope that through this activity, these childrenand their families will receive more love and care, and more people will care about, understand and help them, so thattogether we can create a harmonious and lovely society.。
Litter Picking Activity in Wutong Mountain, Shenzhen
Environmental ProtectionWe support the construction of urban ecosystem and arecommitted to protecting the ecological environment. In2023, our volunteer team participated in a litter pickingactivity themed “Ecological Conservation for a SharedGreen Future” in Wutong Mountain, Shenzhen, alleviatingthe workload of the cleaners. By doing so, we advocate thereduction of uncivilised behaviour such as littering, andconvey the spirit of a green civilisation to the public.
“5km Fun Run for Children of the Stars” Volunteer Activity
CSR indicatorUnit2021202220231 Environmental
1.1. Emissions
Waste Water EmissionTonne10,485,061.511,110,513.912,092,149.0Chemical Oxygen Demand (CODCr)Tonne984.41,029.4995.2Ammonia NitrogenTonne113.6101.1113.6VOCsTonne72.355.169.0NOX
Tonne139.9107.290.1SO
Tonne48.733.534.6ParticulatesTonne27.219.216.0Hazardous and Non-hazardous WasteHazardous WasteTonne5,791.56,410.16,884.2Divided by Category
Pharmaceutical Wastesand Medicine Wastes
Tonne3,034.93,352.93,792.2Other HazardousWastes
Tonne2,756.63,057.13,092.0Divided by ProcessingMethod
Total Hazardous WasteRecycled/Reused
Tonne// 742.2Total Hazardous WasteDisposed
Tonne// 6,141.9Industrial WasteTonne145,628.8151,323.1141,539.1Industrial Waste (Recyclable)Tonne//48,400.0Industrial Waste (Non-Recyclable)Tonne//93,139.1Greenhouse Gas Emissions
Total Greenhouse Gas Emissions
CO
equivalent (in tonnes)
1,005,579.81,037,613.6 1,033,000.9Intensity of Greenhouse Gas Emissions
CO
equivalent(in tonnes)/RMB10,000
/0.52 0.51
Data List of Key Performance Indicators
Scope of environmental data disclosure: all the manufacturing enterprises of Joincare.
Disclosure of major pollutants/emissions and related emission data according to the production characteristics of enterprises.
Among other hazardous waste, high-level radioactive waste is included. This year, the amount of high-level radioactive waste is zero.
The intensity in 2023 was calculated based on RMB 10,000 of output value.
Corporate Social Responsibility Report 2023
CSR indicatorUnit202120222023Direct Greenhouse Gas Emissions (Scope 1)
CO
equivalent(in tonnes)
201,234.8202,473.9 162,677.0Indirect Greenhouse Gas Emissions (Scope 2)
CO
equivalent (in tonnes)
804,345.0835,139.7 870,323.9
1.2 Use of Resource
Total Energy ConsumptionGasolineLitre396,363.6251,528.5387,425.5DieselLitre386,903.8196,825.5261,122.8CoalTonne86,291.088,244.266,894.5Natural Gas10,000 cubic meters949.6858.31,093.9LiqueedPetroleumGasTonne7.96.83.7Purchased SteamTonne880,288.5932,444.11,605,949.6Purchased ElectricityMWh926,560.0959,454.9989,071.4Biomass FuelsTonne//1,004.0Direct Energy ConsumptionMWh/611,129.2506,554.7Indirect Energy ConsumptionMWh/1,682,747.51,787,199.0Renewable Energy ConsumptionMWh/1,320.85,708.2Non-renewable Energy ConsumptionMWh/2,292,555.92,288,045.4Total Energy ConsumptionMWh/2,293,876.72,293,753.6Intensity of Total Energy Consumption
MWh/RMB 10,000/1.11.1Water Consumption
Total Water Consumption10,000 tonnes1,361.31,300.41,426.5Intensity of Total Water Consumption
Tonne /RMB10,0008.16.57.1Recycled Water Volume10,000 tonnes/13.89.2
Packaging Material Used
Packaging Material UsedTonne/14,570.69,236.3Intensity of Packaging Material Used
Tonne/RMB 10,000/0.00730.0046
Data List of Key Performance Indicators
Scope 1 greenhouse gas (“GHG”) emissions are mainly derived from direct GHG emissions from the consumption of fossil fuelsin the company's operations/production processes (e.g. gasoline, diesel, natural gas, etc.), and the formula used is: CO
emissionsfrom fossil fuel combustion = fuel consumption × low level heat generation × carbon content per unit of calorific value × fuel carbonoxidation rate × 44/12. The emission factor and the calculation refer to the Guidelines for Accounting and Reporting of Greenhouse GasEmissions from Non-Industrial Enterprises (Trial) (《工业其他行业企业温室气体排放核算方法与报告指南（试行）》). 11
Scope 2 GHG emissions are mainly derived from indirect GHG emissions from purchased electricity and steam consumed bythe company's operations/production processes, calculated with reference to the document “Appendix 2: Reporting Guidance onEnvironmental KPIs” of the Hong Kong Stock Exchange. In 2021-2022, the power emission factor adopts the grid emission factor
0.5810 tCO
/MWh in the Corporate Greenhouse Gas Emission Accounting Methodology and Reporting Guide for Power GenerationFacilities (企业温室气体排放核算方法与报告指南发电设施) (Huan Ban Qi Hou [2021] No. 9).In 2023, the power emission factoradopts the grid emission factor 0.5703 tCO2/MWh in the Notice on the management of greenhouse emission reporting for enterprises inthe power generation industry from 2023 to 2025 (关于做好2023-2025年部分重点行业企业温室气体排放报告与核查工作的通知).
CSR IndicatorUnit202120222023
2. Social Responsibility
2.1 Employment
Number of Employees: By Gender, Age Group, Geographical Region and Job LevelNumber of EmployeesPerson13,23414,11614,365Gender
MalePerson7,0447,5317,788FemalePerson6,1906,5856,577Age
30 and belowPerson4,3935,0264,90031-49Person8,0428,2048,53650 and abovePerson799886929GeographicalRegion
Chinese MainlandPerson13,21814,09714,348Hong Kong, Macao and Taiwan, ChinaPerson465ForeignersPerson121312
Job Level
President and Vice President(Executive Management)
Person//12General Manager Level and above(Senior Management)
Person//107Director LevelPerson//252Manager LevelPerson//1,143Other EmployeesPerson//12,863Diversity of EmployeesNumber of Women in Executive ManagementPerson//2Share of Women in Executive Positions%/26.716.7Number of Women in Senior Management Person//31Share of Women in Senior Management Positions%//29.0Share of Women in Management Positions%/34.235.4Share of Women in Management Positions in Revenue-generating Functions
%/28.827.5Share of Women in STEM-related Positions%/55.553.7Number of Ethnic Minority Employees
Person/784789HiringTotal Number of New Employee HiresPerson/4,3513,999Number of New Employee Hires by Gender and Age Group
Gender
MalePerson/2,3262,371FemalePerson/2,0251,628Age
30 and belowPerson/2,6642,43431-49Person/1,6641,54650 and abovePerson/2319Percentage of Open Positions Filled by Internal Candidates(Internal Hires)
%/14.418.9
The largest three ethnic minorities of Joincare’s workforce are Hui (1.67%), Zhuang (1.25%) and Tujia (0.50%), and the shares of Hui,Zhuang and Tujia in the management are 0.40%, 0.73% and 0.60%.
Corporate Social Responsibility Report 2023
CSR IndicatorUnit202120222023
Percentage of Internal Hires by Gender and Age GroupGender
Male%/54.155.7Female%/45.944.3Age
30 and below%/27.934.131-49%/70.562.850 and above%/1.63.1Years Employed by the CompanyAverage Years Employed by the Company for MaleEmployees
Year/Person/8.27.4Average Years Employed by the Company for FemaleEmployees
Year/Person/6.46.3Group’s Turnover Rate
Overall Employee Turnover Rate%121212Including: Active Employee Turnover Rate%121212Employee Turnover Rate by Gender, Age GroupGender
Male%/1011Female%/1114Age
30 and below%/131631-49%/91050 and above%/64Employee Engagement SurveyEmployee Engagement%/8790
2.2 Health and Safety
Number of Work-related Injuries
Number of Work-related Fatalities for full-time employeesPerson000Days Lost due to Work-related Injuries- Full-time employeesDay13321498Lost-TimeInjuryFrequencyRate(LTIFR)-Full-timeemployees
Number ofInjuries/Million HoursWorked
/0.250.16Number of Work-related Fatalities for ContractorsPerson/00Days Lost due to Work-related Injuries - ContractorsDay/00Lost-TimeInjuryFrequencyRate(LTIFR)-Contractors
Number ofInjuries/Million Hoursof Works
/00
In order to better demonstrate the Group’s human resource management and ensure the consistency of the calculation of internalmanagement and external disclosure, the calculation of the turnover rate in 2023 directly adopted the methodology used by the Group’shumanresourcesmanagement,i.e.thenumberofemployeeresignedwasequaltothenumberofpermanentemployeeswhovoluntarilyresign. Due to the different calculation method of the overall employee turnover rate in 2021 and 2022, we made retrospectiveadjustments to the 2021 and 2022 turnover rate in the current year, so that the employee turnover rate from 2021 to 2023 would becalculated on the same basis, to ensure that the data are continuous and comparable.
CSR IndicatorUnit202120222023
2.3 Training and Development
Total Training Percentage for Employees%//100Total Training Hours for EmployeesHour1,027,812895,409975,834Training Hours for Male EmployeesHour561,602474,502531,945Training Hours for Female EmployeesHour466,210420,908443,889Average Training Hours per EmployeeHour/Person77.763.467.9Average Training Hours per Employee by Gender and Age Group
Gender
MaleHour/Person79.763.068.3FemaleHour/Person75.363.967.5Age
30 and belowHour/Person/63.385.231-49Hour/Person/63.758.550 and aboveHour/Person/61.663.5Average Training Hours of Employees in ManagementTraining
Hour/Person//19.0Average Training Hours of Employees in Leadership TrainingHour/Person//27.3Percentage of Successful Succession/Promotion toManagement Positions
%//14.5Average Amount Spent per Employee on TrainingRMB/Person/323.7406.9
2.4 Product Responsibility
Percentage of Total Products Sold or Shipped Subject to Recalls for Safety and Health ReasonsPercentage of Such Products to Total Products Sold and/orshipped
%000Number of Products and Service Related Complaints ReceivedProduct-related ComplaintsTime/92147Medication QueriesTime/2017
2.5 Business Ethics
Number of Brought and Concluded Legal Cases RegardingCorrupt Practices
Case000NumberofBreachesonConictsofInterestCase000Number of Breaches on Money Lanudering or Insider tradingCase000Number of Breaches on Customer Privacy DataCase000Number of Breaches on Discrimination or Harassment Case000
2.6 Public Welfare Projects
Resource Contributed to the Focus AreasFinancial DonationRMB 10,0002,045.6569.91,976.2Value of Donated GoodsRMB 10,000864.5641.8622.3