For the health for the future
(I) Group Overview 6(II) Organizational Structure 6(III) Corporate Culture 7(IV) Value Sharing 7(V) Our Awards 8
The Report at A Glance 4Chairman’s Statement 5
About Joincare
Contents
(I) CSR Strategy 9(II) CSR Governance 9(III) Communication on Responsibilities 10
1. Communication with Stakeholders 10
2. Decision of Critical Issues 11
(IV) Compliance Governance 12
1. Protection of Shareholders' Rights and Interests 12
2. Performance of Duties of Directors and
Supervisors 12
3. Disclosure Transparency 12
4. Carrying Forward the Party-Masses Spirit 13
(V) Integrity and Business Ethics 14
1. Establishing the Polices of Business Ethics 14
2. Internal Audit and Supervision 15
3. Whistleblower Protection 15
4. Promoting a Culture of Integrity 15
CSR Governance
(I) Focusing on R&D and Innovation 16
1. Committed to Respiratory Healthcare Market
Niche 18
2.R&DE?ortsinBio-PharmaMarket20
3. Planning in Long-acting sustained-release
microspheres 21
4. Setup of Nano-lipid Microemulsion R&D
Platform 21
5. Paying Attention to Rare Diseases 22
6. Protecting Intellectual Property Rights 23
7. Promoting Industrial Development 24
(II) Improving the Accessibility of Medicines 25
1. Improving Healthcare Accessibility 25
2.ImprovingMedicalA?ordability26
3. Advocating for the Rational Use of Medicines 26
Inclusive Healthcare
(I) Protection of Rights and Interests of Employees 38
1. Compliance of the labor Law 38
2. Workface Diversity and Inclusiveness 38
3. Openness to Communication 39
(II) Human Resources Management 39
1. Talent Recruiting and Retention 39
2. Compensation System 39
3. Equity Incentive Compensation 40
4. Training and Development 40
5. Training and Promotion Plans 41
6. Encourage Work-Life Balance 42
Health Empowerment
(I) Product Quality Control Mechanism 27
1. Managing Quality System 27
2. Quality Risk Management 29
3. Pharmacovigilance Management 29
4. Legal Compliance of Business Operations 29
5. Supply Chain Management 30
(II) Ensuring Production Safety 31
1. Occupational Safety Management 31
2. Safety Culture Development 32
3. Occupational Health Protection 34
(III) Promoting Social Health 35
1. Caring for Patients with Chronic Disease 35
2. Caring about Poverty Alleviation by Developing
Education 36
3. Contributing to Epidemic Prevention and Control 36
4. Pushing Forward Poverty Alleviation by
Developing competitive Industries 37
5. Commitment in Community Activities 37
Health Responsibility
Appendix - Key Performance Table 51
(I) Green Management 43
1. Management Targets 43
2. Management Structure 44
3. Management System 44
4. Regular EHS Audit 45
(II) Green Production 45
1.EnergyE?ciencyImprovement45
2. Saving Resources 47
3. Pollutant Reduction 48
Green Development
OverviewThe report, covering the period from January 1, 2020 toDecember 31, 2020, is the fourth corporate social responsibility(CSR) report issued by Joincare Pharmaceutical Group IndustryCo., Ltd. ("Joincare") (Stock Code: 600380).
Preparation BasisThis report is prepared mainly in accordance with the Guidelinesfor Environmental Information Disclosure of Listed Companieson the Shanghai Stock Exchange and with reference to theEnvironmental, Social and Governance (ESG) Reporting Guidepublished by the Hong Kong Stock Exchange (i.e.SEHK). Inlight of the requirements of the aforementioned standards, toensure the completeness, materiality, authenticity and balance ofthe content, the preparation of this report has gone through stepsincluding benchmark selections, questionnaire survey, interviewswith relevant stakeholders, due diligence and research of socialresponsibility, information collection, information review, reportcompilation and the management review.Scope of the ReportThe policy documents, statements, and data in this reportcover Joincare and its wholly-owned subsidiaries and holdingsubsidiaries.DenitionsFor the sake of compendious expression, "Joincare", "Group" and"We" mentioned in this report all refer to Joincare PharmaceuticalGroup Industry Co., Ltd. This report involves several subsidiariesof Joincare. Moreover, the full names and abbreviations of thesubsidiaries used in the report are listed below:
Name of SubsidiaryAbbreviationLivzon Pharmaceutical Group Inc (Stock Sode:
000513)
LivzonShenzhen Haibin Pharmaceutical Co., Ltd.Shenzhen HaibinXinxiang Haibin Pharmaceutical Co., Ltd.Xinxiang HaibinShenzhen Taitai Pharmaceutical Industry Co., Ltd.Taitai PharmaceuticalJiaozuo Joincare Bio Technological Co., Ltd.Jiaozuo JoincareJoincare Haibin Pharmaceutical Co., Ltd.Joincare Haibin
Name of SubsidiaryAbbreviationShanghai Frontier Health PharmaceuticalTechnology Co., Ltd.
Shanghai FrontierSichuan Guangda Pharmacy Co., Ltd.Sichuan GuangdaShanghai Livzon Pharmaceutical Co., Ltd.Shanghai LivzonLivzon (Group) Pharmaceutical Factory
Livzon Pharmaceutical
FactoryLivzon (Group) Limin Pharmaceutical Factory
Limin Pharmaceutical
FactoryZhuhai Livzon Diagnostics Inc.Livzon DiagnosticsZhuhai Livzon Biomedical Technology Co., Ltd.Livzon BioZhuhai Livzon Microsphere Technology Co., Ltd.Livzon MicrosphereLivzon New North River Pharmaceutical Co., Ltd.
New North RiverPharmaceuticalGutian Fuxing Pharmaceutical Co., Ltd. Gutian FuxingJiaozuo Livzon Syntpharm Co., Ltd.Jiaozuo Livzon SyntpharmLivzon Group Ningxia Pharmaceutical Co., Ltd.Ningxia PharmaceuticalLivzon Syntpharm Co., Ltd. (Zhuhai FTZ)
Livzon Syntpharm
(Zhuhai FTZ)Livzon Group Fuzhou Fuxing Pharmaceutical Co.,Ltd.
Fuzhou Fuxing
Data Sources and Reliability Statement
The board and all directors of Joincare guarantee that this reportdoes not contain any false statement, misleading statementor material omission and assume liability for the authenticity,accuracy and integrity of this report.
Access and Response to the Report
This report can be accessed or downloaded from the officialwebsite of Shanghai Stock Exchange (www.sse.com.cn) and ourofficial webpage (http://www.joincare.com). Should you needto make further inquiries, comments or suggestions regardingthis report, please contact us via fax (0755-86252165) or email(joincare@joincare.com).Conrmation and Approval of this ReportThecontentsofthisreporthavebeenconrmedbythemanagementand been approved by our Board of directors on March 29, 2021.This report is originally written in Chinese; this English version isfor stakeholders’ reference only. Should ambiguities arisen betweenthe two versions, the Chinese version shall prevail.
The Report at A Glance
Joincare
SOCIAL RESPONSIBILITY REPORT 2020
Dear Stakeholders of Joincare,2020wasanextraordinaryyearforus,asCOVID-19hitusasaglobalhealththreatandhascontinuedtoa?ectussincethebeginningoflast year.Fortunately, those who meet challenges head-on are the ones who will progress. Facing the sudden outbreak, Joincare responded to theCommunist Party of China (CPC) and the governments’ call to resume work and production in an orderly manner. All our employeesputforthtremendouse?ortsandovercamedi?cultiesinthemosttryingoftimestoensurethenormalpaceoftheGroup'sbusinessandoperations. By obtaining approvals, Joincare succeeded in bringing several inhalation products to domestic market throughout 2020.This demonstrates significant progress we have made in the localization of inhalation medicine products. It also demonstrates that ourprevious years of intensive efforts towards R&D on inhalation products had borne fruits ready to harvest. Among these, our exclusiveproduct Levosalbutamol Hydrochloride Nebuliser Solution (i.e.盐酸左沙丁胺醇雾化吸入溶液) was successfully included in the nationalmedical insurance catalog in 2020 through negotiations as medical insurance medicines. This was a meaningful milestone for Joincare inour exploration of the domestic inhalation preparation market.We are committed to "attentively developing high-quality medicines and innovative medicines", focusing on complex preparationswith high technical barriers like inhalation administration, antibody, long-acting sustained-release microspheres and nano-lipidmicroemulsion. We are creating a complete network for corporate technology innovation involving collaborations with governmententerprises,well-knownuniversitiesandresearchinstitutions.Duringthereportingperiod,veproductswereapprovedtomarketandsixproducts were granted approval for clinical trials.We continue to improve our corporate governance in 2020 by establishing a social responsibility committee to manage the Group'sstrategy and planning for sustainable development. We adhered to the code of business ethics with high standards applied in internalcontrol and risk management, fostering a healthier business environment.We have continuously emphasized the development of talent and are committed to the "common development of employees andJoincare". We have established an innovative mechanism for long-term incentives that will grant shares of the company to seniormanagement and core technical teams through via mid- to long-term business partner shareholding plans; we have also established apartnership system for sharing benefits and risks among business partners and to promote the steady, long-term development of theGroup.We place a high value on environmental protection and operate according to “green” concepts. We continuously promote standardizedmanagement of our subordinate manufacturers according to the ISO14001 Environmental Management System and we have carriedout plans for pollutant discharge reduction and energy-saving renovations with reference to the practices of world-leading medicinecompanies.Inallwedo,ourguidanceisthegovernment’so?cialvisionfor"achievingcarbonneutralityby2060".In response to the sudden outbreak of the COVID-19 pandemic, we were brave enough to shoulder our social responsibilities. Ourholding subsidiary, Livzon responded quickly to the new development of COVID-19 test reagents, and to support the registration andcompletion of 17 million tests across 38 countries and regions. All the while, we have continued donating medicines worth over RMB 10million to communities in need.Moving forward, Joincare will stay true to our original aspiration, commitment to high quality, and the focus on research anddevelopment to build a leading high-end preparation brand in the healthcare industry. Most importantly, we will always "puts people's lifeandhealthintherstpalce".AndcollaboratewithstakeholdersfromalldisciplinesandindustriestomakeChinaamoreenvironmental-friendly and healthier place. Furthermore, we will carry forth our missions to rejuvenate national medicine, to meet patients' practicalneeds,andtobecomeaninnovativepharmaceuticalenterprisewithindustryinuence. Chairman:
Chairman’s Statement
About Joincare(I) Group Overview
Joincare's business covers multiple areas, such as health care products, Finished Pharmaceutical products (i.e., FPPs), traditional Chinesemedicines,chemicalActivePharmaceuticalIngredients(APIs)andintermediates,diagnosticreagentsanddevices.Thediversiedpipelineand portfolio of products has enabled the Group to have more market and growth opportunities. We have been committed to our healthcarebusiness since founding and well-known brands, like "Taitai”(i.e.太太), "Jingxin"(i.e.静心) and "Eagle's"(i.e.鹰牌), have strong marketinuences.Joincare'slargestsourceofrevenuecomesfromFPPs:prescriptionmedicineslike"Beineng(i.e.倍能) ", "Yili-an(i.e.壹丽安)", "Beiyi (i.e.贝依)" and "Lishenbao"(i.e.丽申宝) , and OTC (over-the-counter) medicines like "Livzon Dele"(i.e.丽珠得乐), "LivzonChangle"(i.e.丽珠肠乐) and "Yiketie"(i.e.意可贴) have ranked among the top sales medicines in market. After "Shutanlin"(i.e.舒坦琳), "Lishutong"(i.e丽舒同), "Wushu"(i.e.雾舒) and other inhaled medicine products are successively got authority for market Joincare'sproduct pipelines of respiratory medicines strengthened , laying a solid foundation for the strategic goal of "becoming the domestic leadingenterprise in respiratory inhalation market". The Group's chemical APIs and intermediates include cephalosporin series, statin series andcarbapenem series. Our traditional Chinese medicine (TCM) medicines include the anti-tumor medicine "Shenqi Fuzheng Injection"(i.e.参芪扶正注射液) and the anti-cold medicine "Antiviral Oral Granules"(i.e.抗病毒口服颗粒) . Diagnostic reagents cover COVID-19 testreagents, HIV antibody diagnostic reagents and Mycoplasma pneumoniae antibody diagnostic reagents.TheGrouphasadiversiedandmulti-levelR&DinstitutionswithstrongR&DcapabilitiesandglobalR&Dconceptsintheeldsof chemical and TCM preparations, biologics, diagnostic reagents, healthcare products and food. Our R&D pipeline focuses onthe fields of respiratory system, anti-infective, anti-tumor, gonadotropin, digestive and nervous system. In recent years, we havebeen focusing on the innovation and improvement of inhalation administration therapy, antibody and microsphere release, lipidmicroemulsionandothertechnologyplatform.Throughthee?ortsmentionedabove,wefurtherimproveourproductportfoliosandbusiness and our core competitiveness.(II) Organizational Structure
Shareholder meetings
Board of DirectorsBoard of Supervisors
theBoardO?ce
CEO
Remuneration and Appraisal Committee
Strategy CommitteeNomination Committee
CSRCommitteeAudit Committee
Sales
ManagementCenter
Supervision
and AuditDepartmentProductionManagementCenterR&DManagementCenterIntegratedManagementCenterFinancialManagementCenter
MissionVisionCore Values
(IV) Value SharingDuring the reporting period, Joincare achieved an operating income of RMB 13.52 billion, up by 12.87% compared with the sameperiod of the previous year; generated RMB 1.12 billion of Net profit attributable to shareholders of the listed company, with ayear-on-year increase of about 25.28%; and produced RMB 0.967 billion of net profit attributable to shareholders of the listedcompanyafterdeductingnon-recurringprotandloss,withayear-on-yearincreaseofabout16.63%.At the same time, the Group was actively creating social value. It generated RMB 1.42 billion of tax revenue for the government,paid RMB 1.47 billion in salary to employees, distributed dividends and paid interest worth RMB 1.04 billion to banks andother creditors, donated funds and goods totaling RMB 22.16 million to the society and created a social contribution per share ofapproximately RMB 2.02 for the society in 2020.
business income
13.52
billion
Netprotattributabletoshareholdersof the listed company
1.12
billion
Turn in taxes
1.42
billion
Donation of funds and goods
22.16
million
(III) Corporate Culture
For more than 20 years, Joincare has forged ahead despite the twists and turns, ever staying true to its original aspiration in itsongoing inheritance and innovation. Gradually, We have formed a strong sense of duty — " For the Health, For the Future".Along this journey, we always act in the interests of patients and focused on the safeguarding of human life and health. Wecontinuously increase our investments in R&D and innovation, work with top domestic R&D teams to conduct in-depth researchand strategic planning, and carefully conceive a new vision for "attentively developing high-quality and innovative medicines". Inaddition, We actively and continuously contribute to the building of a community with a shared future for the public. Even whilefocusing on the business development, We are committed to empower employees, providing them opportunities for sustainablecareer development. With "Putting People in the First place, Valuing Workmanship and Quality, Pursuing Innovation and Truth,Promoting Cooperation and Sharing" as core values, We consider the quality of products, the training of talents, and the strengthof R&D the utmost importance, thereby aligning the values of the enterprise and those of our employees’.
Attentively DevelopHigh-quality Medicinesand Innovative Medicines
PuttingPeopleattherstplace,Valuing Workmanship and Quality,Pursuing Innovation and Integrity,Promoting Cooperation and Sharing For the Health,For the Future
May 2020
September 2020
September 2020
September 2020
November 2020
May 2020
September 2020
September 2020
July 2020
Awarded ByPrize-AwardingItems
Awarded ByPrize-AwardingItems
Awarded ByPrize-AwardingItems
Awarded By
Prize-AwardingItems
Awarded ByPrize-AwardingItems
Awarded ByPrize-AwardingItems
Awarded By
Prize-AwardingItems
Awarded ByPrize-AwardingItems
Awarded ByPrize-AwardingItems
Shenzhen Project Care OrganizingCommittee O?ce"Top Ten Caring Enterprises" of the 17thShenzhen Project Care
China Association for Quality InspectionNational Top 100 Leading Enterprises inIntegrity of Quality Inspection
www.yaozh.com, China PharmaceuticalR&D and Innovation Summit OrganizingCommittee, and China PharmaceuticalsTop 50 Pharmaceutical Research andDevelopment in China, 2020 Top 20Research and Development of ChemicalMedicines 2020
District CPC Committee of ShenzhenHigh-tech Industrial Park and NanshanDistrict Enterprise DevelopmentService CenterPublic Welfare Enterprise
National Business Daily"Listed Company of the Largest GrowthPotential in the Healthcare Industry"Award
Chinese Red Cross FoundationDonation Certicate
JRJ.com"ESG Responsible Enterprise" inBiomedicine Industry "Jinzhi Award"
China Business Journal - China BusinessFuture
Annual Social Responsibility ContributionAward of "CSR Competitiveness - ChinaCorporate Social Responsibility" in 2020
STCN and Egsea.com
"The 40 Most Respected Listed Companies"for the 40th Anniversary of ShenzhenSpecial Economic Zone
(V) Our Awards
Joincare
SOCIAL RESPONSIBILITY REPORT 2020
Governance
(I) CSR StrategyJoincare is striving to be an explorer in the healthcare industry and insisting on creating a healthy life driven by technology.The Group pays great attention to its sustainable development, and actively focuses on the internal regulatory environment andexternal policy guidance. Considering We China's 14th Five-Year Plan and the local government's development plan, the Grouphas formulated a CSR strategy and goals adapting to its current business situation.Focusing on "health", the Group's CSR strategy aims to provide the whole society with high-quality, safe, accessible andaffordable medical products and services through the development of its main business, while improving the overall strengthof the health industry. Meanwhile, the strategy is committed to empowering employees and communities, emphasizingenvironmental protection and promoting the overall health development in society.
(II) CSR GovernanceJoincare has long valued the management of its social responsibilities. In July 2020, the Group formally established the SocialResponsibility Committee of the Board of Directors. The main duties of this organization are①studying and formulating theGroup's social responsibility strategy and policies,②reviewing and determining the plans and measures for social responsibilityfulllment;③supervising the implementation of such plans by the Group's social responsibility working group;④supervising,inspecting and evaluating the Group's fulfillment of social responsibilities and giving advice. The Social ResponsibilityCommitteehastherighttoquestionthemajormattersoccurringintheproductionandoperationprocesswithaninuenceontheGroup'sfulllmentofsocialresponsibilities,andisresponsibleforinspectingandurgingthehandlingofsuchmatters.The Social Responsibility Committee is composed of three directors. The term of the Committee shall be the same as that of theBoard of Directors and there must be an independent director. In the Committee, there is a Social Responsibility Working Groupof 26 members, with the Group's President serving as the group leader, and the heads of important functional departments in theeldsofqualitymanagement,environmentandsafetymanagementasmembers.Thegroupisresponsiblefordailyworkliaison,reporting and meeting organization.The 22nd meeting of the 7th session of the Board of Directors of the Group has reviewed and adopted the Social ResponsibilityManagement policy of Joincare, which clarifies the duties and work scope of the Social Responsibility Working Group andstandardizes the division of labor among functional departments. This marks that the institutionalized and systematic managementof the Group's social responsibility work has been realized..Case: Joincare Organized Training on Sustainable DevelopmentIn May 2020,We organized a thematic training session on the new trend and corporate management improvement of CSR,in which the Board of Directors, the Board of Supervisors and senior management of the Group all participated. We invitedexternalconsultantstohelptheGroupgureoutthetrendsofsustainabledevelopmentmanagementinthepharmaceuticalindustry and share the excellent practices from domestic and international counterparts. The training was effective, duringwhich participating members actively discussed the challenges and opportunities facing the Group's social responsibilitymanagement work, and planned management priorities for the next year's social responsibility work.
Joincare
SOCIAL RESPONSIBILITY REPORT 2020
(III) Communication on Responsibilities
1. Communication with Stakeholders
Joincare has established a normal mechanism to communicate with stakeholders. We are looking forward to achieving effectiveinteraction with stakeholders, actively responding to their requirements, creating more value for them, and promoting theimplementation of sustainable development work.StakeholdersCommunication Requirements Communication Methods
Shareholders
Conducting standardized governance and strictrisk controlEnsuring sound operation and value creationProviding open and transparent informationdisclosure
Shareholders' MeetingRegular releases of business information anddataBy telephone, fax, email, and online voting atthe shareholders' meetingThrough the investor's survey, interactivecommunication platforms, and externalroadshows
Government
Working in compliance with laws and ensuringmedicine safetyCooperating with the government's regulationand operating in light of regulationsPaying taxes in accordance with laws andcreating jobs
Government-enterprise symposiumsSupervision and inspectionWork reports and surveys
Employees
Protecting employees' rights and interestsCaring for employees and communicating toknow their requirementsProvidingsalariesandwelfarebenets,aswellas training for development
Workers' congresses and labour unionEmployees' satisfaction surveyOccupational health and safety trainingFeedback platformsDaily communication and visits
Consumers
Guaranteeing product safety and consumers'rights and interestsProtecting privacy and observing businessethics
Providing product labeling and informationdisclosureRegular visitsConsumers' satisfaction surveyHandling of Consumers' complaints andopinionsPartners and suppliers
Guaranteeing honest business operation andmedicines' compliance with regulationsFacilitating timely communication and win-windevelopment
Regular communicationsWorking meetings and exchanges via telephoneand correspondenceCompany's websiteMedia
Promotinge?ectiveinteractionandinformationdisclosure
Interactive Communication PlatformsSpecial ReportsExternal RoadshowsCommunity/ The public
CharityBoosting community development and creatingsocial value
Volunteering activitiesMoney and medicine donationMedicine knowledge publicity
Importance on Stakeholders
Importance on Enterprise DevelopmentGenerally Important Issues
Moderately Important Issues
Highly Important Issues
Analysis on the Importance of Issues in Joincare's CSR Report
2. Decision of Critical Issues
DuetonosignicantchangesinJoincare'sbusinessthisyear,duringthepreparationofthisyear'sCSRreport,theGroupinvitedprofessional consultants to review and evaluate the Group's annual sustainability issues. In combination with the feedbackfrom stakeholders on existing issues, by aligning with the major CSR issue lists of peer companies, and based on the previousyear's analysis results of major CSR issues, the important sustainable development issues to Joincare this year were updated andsummarized as the basis for the preparation of this report.
Product Quality and Safety
Talent Attraction andRetention
Biodiversity Conservation
Environmental ManagementSystem
Protection of IntellectualProperty Rights
Popularization of HealthProducts and Services
Climate Change-RelatedRisks and Countermeasures
Water Use Management
Employees' Health andSafety
Employees' Training andDevelopment
Internal Governance andWork Scheme on SocialResponsibilities
Responsible Marketing
Business Ethics Compliance
Investor RelationsManagement
Corporate Governance
Supply Chain Management
Energy Use Management
Pollutant Management
Raw Material UseManagement
Investment in Charity
Highly Important IssuesModerately Important IssuesGenerally Important Issues
(IV) Compliance GovernanceIn accordance with the requirements of the Company Law of the People's Republic of China (PRC), the Securities Law of the PRC,the Code of Corporate Governance for Listed Companies, the Shanghai Stock Exchange Listing Rules and other relevant laws andregulations, Joincare continuously improved its corporate governance structure, strengthened information disclosure management,investorrelationmanagementandmadee?ortstoimprovetheGroup'sinternalcontrolstostandardizeitsoperations.
1. Protection of Shareholders' Rights and Interests
We convene and hold shareholders' meetings in strict accordance with the Articles of Incorporation, the Rules of Procedurefor Shareholders' Meeting and other relevant regulations to ensure that resolutions are made in a fair and open manner so thatthe rights and interests of shareholders are protected. At the same time, we make full use of modern information technologies,like online voting technology, to ensure that all shareholders, especially our minority shareholders, are able to participate inshareholders'meetingsinthemoste?cientande?ectivewayandtoexercisetheirrighttoknowandtoparticipateindecision-making.Joincare has independent business and an autonomous operation capacity. The Group and its controlling shareholders implementindependent management and independent accounting in business, personnel, assets, institution and finance. The controllingshareholders of the Group exercise their rights and assume their obligations in strict accordance with laws and regulations,and they do not directly or indirectly interfere with the decision-making and business activities of the Group by bypassingthe stockholders' meetings. We have formulated the Policy for Preventing the Controlling Shareholder or the UltimateControllers and Their Related Parties from Occupying Company Funds and established a long-term mechanism for preventingthe controlling shareholder or the ultimate controller and their related parties from occupying funds of listed companies andinfringing upon the interests of listed companies.During the reporting period, there were no disputes arising from the appropriation of the Group's assets by the Group'scontrolling shareholders, or the ultimate controller and their related parties and the detriment of the interests of the Group andthe minority shareholders.
2. Performance of Duties of Directors and Supervisors
At present, there are seven directors on Joincare's Board of Directors, including three independent directors. All of them areprofessionals in law, finance and other fields, providing useful opinions for the effective and standardized governance of theGroup and major policy decision-making. At the same time, the Board of Directors has established the Audit Committee, theRemuneration and Appraisal Committee, the Strategy Committee, the Nomination Committee and the Social ResponsibilityCommittee to assist in performing decision-making and monitoring functions of the board. It has given full play to the professionaladvantagesofeachcommitteetoensurethelegality,scienticityandaccuracyofitsdecision-making.There are three supervisors on Joincare's Board of Supervisors, including one employee representative. During the reporting period,the Board of Supervisors performed its duties in accordance with the law, supervised the performance of duties of the Group'sdirectors and senior executives, regularly inspected the Group's financial affairs, paid attention to the Group's major investmentprojects, and fully safeguarded the interests of the company and all shareholders.
3. Disclosure Transparency
We attach importance to communication and exchange with investors and formulated the Internal regulations for InformationDisclosureA?airsandotherrelevantregulations.TheBoardofDirectorsdesignateaspecialdepartmentandrelevantsta?totakecharge of information disclosure and investor relations management, to strengthen communication and contact with minorityshareholdersandtospecicallyrespondtorelevantissuesraisedbyshareholdersontheproductionandoperationofthecompany.Throughout 2020, we filled and disclosed 271 disclosure documents; and our published contents have 1.43million words inChinese characters, which make us top 97 percentile among the domestic public companies in the industry in terms of quantity ofinformation disclosure. Our Board office communicated with and responded timely to our investors via the official telephone andvia sns.sseinfo.com (i.e.上证e互动) 341 and 107 times respectively. Moreover, we dedicated to establish various communicationchannels and platforms for our investors to ensure their legitimate rights and interests to have equal access to information.
Joincare
SOCIAL RESPONSIBILITY REPORT 2020
4. Carrying Forward the Party-Masses Spirit
Joincare actively practices the system of holding Party (i.e. The Chinese Communist Party) branch general meetings, meetingsofPartybranchcommittees,Partygroupmeetings,andPartylectures.FocusingonlearningandpracticingtheScienticOutlookon Development, We adopt various forms such as centralized study, listening to reports and special seminars, to continuouslyimprove the level of political thinking and the quality of policies and regulations. During the reporting period, the general Partybranch of Joincare regularly held the meetings of Party branch committees and the general meetings of all Party members, andorganized multi-form and multi-dimensional special Party lectures to improve the party spirit of Party members, enabling them toplay an exemplary vanguard role and actively participate in the cause of social services.
Case: Winning the Investor Relations Management Award
Case: Party Members' Actions in COVID-19 Prevention and Control
In November 2020, due to our outstanding performance in investorrelations management, Joincare won the 2019 Golden Bull Awardfor Listed Companies: an award for investor relations management.
During the pandemic, the Party members took active measures to participate in COVID-19 pandemic prevention andcontrol and promote work and production resumption. They assisted in the distribution of anti-pandemic supplies,took employees' body temperatures, guided employees to dine in a way that one unoccupied seat was left between twopersons, and disinfected public areas to fully protect the health of all employees.
(V) Integrity and Business Ethics
We are committed to improving its governance level by complying with the Criminal Law of the PRC, the Law of the PRCAgainst Unfair Competition, the Interim Provisions on Prohibition of Commercial Bribery and other relevant laws and regulations,following domestic and international codes of business ethics, and advocating a business philosophy of integrity and self-discipline. The Group's Board of Directors authorizes the Audit Committee to supervise the issues related to business ethics; andthe Supervision and Audit Department is responsible for the implementation, including improving integrity systems, carrying outaudit and supervision, publicizing and advocating a culture of integrity and good governance, and protecting the rights and interestsof the Group and its stakeholders. During the reporting period, We are not involved with any litigation cases of bribery, fraud,extortion, embezzlement or money laundry.
1. Establishing the Polices of Business Ethics
In order to effectively prevent violations including embezzlement, bribery and fraud, We formulate and implement managementpolicies such as the Anti-Corruption and Anti-Commercial Bribery System and the Anti-Fraud Regulations and set additionalrequirements for particular business segments, including the Financial Management System, the Accounting Organization andAccounting Personnel Management System, the Outbound Investment Management System, the Investment Project InitiationApplication Form as well as the Cost Control. The policies mentioned above are applicable to all the employees of Joincare and itssubsidiariestoe?ectivelyregulatetheuseoffundsandeliminateembezzlement,bribery,fraud,moneylaundryandotherviolations.In order to implement the anti-corruption management responsibility, the Group requires its management, employees and partnerscomply with business ethics. The management shall sign the Oath of Integrity for Senior Executives of the Company to clarifythat they shall abide by national laws and regulations, comply with the Group's rules and regulations, and adhere to the principleof integrity and self-discipline during the working period. All employees shall learn the Code of Conduct for Employees inthe induction stage to understand the compliance requirements, and sign the Commitment Letter of Anti-commercial Bribery,promising to eliminate integrity violations during their employment. At the same time, Joincare also regulates the process tomitigate ethical risks in business cooperation. According to the systems related to procurement management, a bidding team,composed of members from multiple departments of the Group and its subsidiaries, rates potential suppliers in terms of technologyandbusinessandidentiesthesupplierofthehighestscoretoavoidsubjectivejudgment,corruptionandfraud.Allsuppliersshallsign the Anti-Commercial Bribery Agreement with the Group, promising to implement the service contents and work in compliancewith the commercial ethics standards and regulations in the cooperation process in strict accordance with the contract.
Case: Showing the Party's Care for Sta? during the Spring Festival
The hearts of the party and the masses were linked with each other to celebrate the Spring Festival together. On theNew Year's Eve, the Party organization arranged a series of New Year's customs and cultural activities for all TaitaiPharmaceutical's employees staying in Shenzhen, including making dumplings, the management's distribution of redenvelopes and watching the Spring Festival Gala together. Through those activities with a strong festive atmosphere, allthesta?stayinginShenzhenspentajoyfulandwarmSpringFestival.
2. Internal Audit and Supervision
Joincare abides by the applicable regulations, such as the Provisions of the National Audit Office on Internal Audit and theGuiding Opinions of the General Office of the State Council on Reforming and Perfecting the Comprehensive SupervisionSystem for the Medical and Health Industry, and complies with the Rules for Implementation of the Audit Committee, theInternal Control System, the Internal Audit Work System, the Internal Audit Project Type and Working Procedures, and theCollection of Internal Audit Work Norms. The audit committee formulates the annual work scheme and carries out audit work forthe Group and its subsidiaries.According to the approved annual audit work scheme, the audit and supervision department carries out special audits on thebusiness process of the wholly-owned subsidiaries, holding subsidiaries, business divisions and functional departments of theGroup every 18-24 months. During the reporting period, no major defects were found in the special audits of the whole businessprocessoftheGroup'ssubsidiaries,andthegeneraldefectsdetectedhavebeenrectiedintime.
3. Whistleblower Protection
Joincare formulates the Measures for the Management of Complaining and Reporting, which stipulates that all the employees,suppliers and customers of the Group have the right to report and complain about potential misconducts. Please refer to https://www.joincare.com/intro/30.html for details of complaining and reporting channels such as Group's postal address, emailaddresses and telephones. The Group's supervision and audit department is responsible for the complaint management, includingthe acceptance of reports and complaints, the recording, escalating, investigation, follow-up review and handling of the reportedand complained violations of laws and disciplines as well as frauds, which shall be recorded by specially-assigned personnel,so as to ensure that an investigation must be conducted for every complaint or report, a conclusion must be reached for everyinvestigation and a response muse be made to every conclusion.Joincaree?ectivelyprotectsthepersonalinformationofthewhistleblowers,strictlykeepscondentialityofthecontentofreports,andincorporatesthematerialsandrecordsofreportsintocondentialdocumentmanagement.Condentialitygoesthesameforverifying the situation. Those who violate relevant regulations, leak information of the informers or retaliate against informantswillbeprosecutedforcriminalresponsibilityonceveried.
4. Promoting a Culture of Integrity
Joincare advocates the corporate culture of integrity and transparency, cultivating ethical culture with the principle of "honesty,law-abiding and honest operation". Meanwhile, Joincare integrates the concept of risk management into ethical training topromote compliance management. The supervision and audit department, through corporate culture publicity and training,guides employees to abide by disciplines and laws, and develop senses of integrity in their respective posts. Employees havebeen inspired and influenced by the concept of business ethics delivered in the training, which provides strong support for theenterprisetostrengthenmanagementandimprovee?ciency.
Joincare
SOCIAL RESPONSIBILITY REPORT 2020
Inclusive Healthcare
(I) Focusing on R&D and InnovationIn pursuing innovation-driven growth, we focus our R&D efforts and investments on innovative medicines and complexpreparationswithhigh-barriersofR&Dandmass-production;andwearededicatedtoimprovetheaccessibilityanda?ordabilityofhigh-quality pharmaceutical products. The Group has developed R&D technology platforms such as like inhalation administration,antibody, long-acting sustained-release microspheres and nano-lipid microemulsion, has three national R&D technology centersand several provincial and municipal innovation carriers, has established a long-term cooperative relationship with many well-known scientific research institutions at home and abroad, forming a sound enterprise technology innovation network withcoordinatede?ortsofenterprises,universitiesandresearchinstitutions.Case: Strategic Cooperation with Shenzhen Bay LaboratoryInordertoimprovetheresearchcapabilityofthebasicapplicationofbiomedicineandprovidestrongsupportinscienticresearch and achievement transformation for the biomedicine industry in Guangdong-Hong Kong-Macao Greater BayArea, Joincare and Shenzhen Bay Laboratory signed a strategic cooperation agreement in December 2020. Both partieswill leverage their respective resources and advantages and cooperate in scientific research, intellectual property rightsandachievementtransformationintheeldofbiomedicine.Shenzhen Bay Laboratory (Guangdong Provincial Laboratory of Life Information and Biomedicine) was initiated by theCommunist Party of China Guangdong Provincial Committee and the provincial government in a bid to create a nationallaboratory and build a "back-up" for a national laboratory.
DateMajor R&D/Registration ProgressFebruary 2020
ClinicalTrialNoticationobtainedforRecombinantAnti-humanIL-17A/FHumanizedMonoclonalAntibody InjectionApril 2020Quality Consistency Evaluation passed for Tinidazole TabletsMay 2020ClinicalTrialNoticationobtainedforAripiprazoleMicrospheresforInjectionMay 2020
ClinicalTrialNoticationobtainedforRecombinantTumorEnzymeSpecicInterferonα-2bFcFusionfor InjectionJuly 2020RegistrationCerticateobtainedforBudesonideSuspensionforInhalation(2ml:0.5mg)August 2020ClinicalTrialNoticationobtainedforIndacaterolMaleatePowderforInhalationAugust 2020
Approval of Supplementary Medicine Application obtained for Levosalbutamol Hydrochloride NebuliserSolutionSeptember 2020RegistrationCerticateobtainedforIpratropiumBromideSolutionforInhalationSeptember 2020ClinicalTrialNoticationobtainedforOctreotideAcetateMicrospheresforInjectionSeptember 2020
ClinicalTrialNoticationobtainedforLevosalbutamolHydrochlorideandIpratropiumBromideInhalation SolutionSeptember 2020Quality Consistency Evaluation passed for Amlodipine Besylate CapsulesOctober 2020Quality Consistency Evaluation passed for Meropenem for InjectionOctober 2020RegistrationCerticateobtainedforDantroleneSodiumforInjectionDecember 2020RegistrationCerticateobtainedforBudesonideSuspensionforInhalation(2ml:1mg)December 2020RegistrationCerticateobtainedforω-3-FishOilMediumandLongChainFatEmulsionInjectionDecember 2020Quality Consistency Evaluation passed for Irbesartan Tablets
The Group's R&D team has been growing continuously, with 1,557 R&D personnel and ever-increasing investment in R&D. TheR&D expenses in the reporting period amounted to RMB 1260.53million , up by 18.25% from the same period of the previousyear, accounting for 9.32% of the total audited operating revenue of the company in the reporting period. During the reportingperiod,theGroupobtainedregistrationapprovalforvevarieties,clinicaltrialapprovalforsixvarieties,andpassedconsistencyevaluation for four varieties.
2017
704.58853.581,065.981,260.53
1200.001000.00
800.00
600.00
400.00
200.00
0.00
10.00%
8.00%
6.00%
4.00%
2.00%
0.00%
2018
Joincare's R&D revenue and the proportion of its
total revenue in 2017-2020
20192020
7.34%
7.62%
9.32%8.90%
2017
1,008
200015001000
15.00%
10.00%
5.00%
0.00%
1,1601,1771,557
2018
Number and Proportion of R&D Personnel
of Joincare in 2017-2020
Number of R&D personnel (persons) Proportion of R&D personnel
20192020
Amount of R&D investment(RMB 1,000,000)
Ratio of R&D investment tooperation revenue
10.18%
9.27%
12.49%
10.97%
Joincare
SOCIAL RESPONSIBILITY REPORT 2020
1. Committed to Respiratory Healthcare Market Niche
Theinhaledmedicineproductsarethebestandmoste?ectivetherapymethodsforrespiratorydiseases,suchasasthmaandchronicobstructive pulmonary disease (COPD) and the R&D investemtns in this market niche are highly recommended by the Chinesegovernment.Thedomesticmarketinthiseldisrisingrapidlyandhasbroadprospectsfordevelopment.Duetothehighbarriersto the R&D and production of inhalant medicines, the market shares have been dominated by foreign big-pharma companiesfor long time. In response to the national appeal, Joincare has actively made strategies to enter the respiratory disease medicinemarket. In 2013, the Group established Shanghai Frontier in cooperation with Dr. Jin Fang, the leader and pioneer in the R&Dof inhalation medicines market in China, and our R&D team, to carry out an comprehensive and diversified pipeline in the fieldof respiratory medicines, and jointly created a platform for the research, evaluation and engineering development of respiratorydisease medicines at the most advanced technical level in China. In 2015, Joincare and Guangzhou Institute of Respiratory Health,led by Academician Zhong Nanshan, jointly established Guangzhou Joincare Respiratory Medicine Engineering Technology Co.,Ltd., to further enhance the clinical resources and strength of the Group in the respiratory medicines sector, focus on breakingthrough the high technical barriers to the R&D and production of respiratory medicines, and break the landscape of multinationalpharmaceutical enterprises dominating the Chinese market. At present, the Group has successively launched several key products,and has made breakthroughs in the inhalation administration device.Levosalbutamol Hydrochloride Nebuliser Solution - Exclusively Approved in China andIncorporated to the National Medical Insurance Catalog (2020)
In September 2019, Joincare's Levosalbutamol Hydrochloride Nebuliser Solution (Lishutong?) received the MedicineRegistrationApprovalissuedbytheNationalMedicalProductsAdministration.Itistherstnebulizersolutionapprovedfor registration under the New Category 3 in China, and the cumulative R&D cost directly invested is about RMB 20.11million. Compared with ordinary salbutamol, its dosage is smaller, and the side effect risk is lower, and the morbidityintervalsandhospitalizationtimeofpatientscanbesignicantlyreduced.In August 2020, the Levosalbutamol Hydrochloride Nebuliser Solution (3ml:0.31mg) obtained the approval of medicinesupplementary application as the special dosage for children. It is mainly used to treat or prevent bronchospasm causedby reversible airway obstruction diseases in children aged 6-11 years, and is one of the preferred medicines for acuteasthma attacks among children. In December 2020, Lishutong? was incorporated to the National Medical InsuranceCatalog (2020), becoming the only domestically produced respiratory medicines included in the "negotiated medicine forrenewal" of the new catalog.
Budesonide Suspension for Inhalation - The First Company to Obtain Approval for Both Smalland Large Specications in China
Medicine Administration with AI technology - Improving the E?ciency of Respiratory Therapy
In 2020, Joincare successively obtained the MedicineRegistration Certificate for the two specifications(2ml:0.5mg and 2ml:1mg) of Budesonide Suspensionfor Inhalation (Wushu?), becoming the firstenterprise to obtain approval for both small and largespecicationsinChina.Budesonide Suspension for Inhalation can be used totreat such diseases as bronchial asthma, COPD, acuteand chronic bronchitis. It is currently the respiratorymedicines with the largest sales revenue in China andalso the product with the largest consumption volume atdepartment of respiratory in China.
While focusing on the R&D of respiratory medicines, theGroup pays attention to the development of householdintelligent nebulizers, which is of great significance tofurther changing the current situation of low accessibilityof nebulization and treatment in traditional hospitals. Thedevice is easy to carry and operate, and can intelligentlyadminister respiratory medicines according to patients'breath. With the same quality for hospitals, it meets themedical device standard. The interior design can reducenoise and the plate is replaceable. With the advantages ofhighe?ciencyandpatientcompliance,thedevicecanbewidely used.
Joincare
SOCIAL RESPONSIBILITY REPORT 2020
The successive market approval of such products as Levosalbutamol Hydrochloride Nebuliser Solution and Budesonide Suspensionfor Inhalation has marked Joincare's important breakthroughs in the field of respiratory medicines. Adhering to the vision of"attentively develop high-quality medicines and innovative medicines", and starting from the original intention of "join us inrespiratory care", the Group focuses on the R&D of respiratory medicines and has formed a clear and comprehensive R&Dpipeline,providingmoree?ectiveandsafemedicineoptionsfordomesticpatientswithasthmaandCOPD.
The major R&D progress in our pipeline of inhaled medine R&DMedicineForm
Product NameMedicine Category
Research StagePharmaceutical
Study
Clinical Study
Application forProduction
Inhalationsolution
Tobramycin Inhalation SolutionCategory 2.4 chemical medicineLevosalbutamol Hydrochloride andIpratropium Bromide Inhalation Solution
Category 2.3 chemical medicineFormoterol Fumarate Inhalation SolutionCategory 3 chemical medicineAmbroxol Hydrochloride Inhalation SolutionCategory 3 chemical medicineAcetylcysteine Inhalation SolutionCategory 4 chemical medicineTerbutaline Sulfate Nebuliser SolutionCategory 4 chemical medicinePowder forinhalation
Salmeterol Xinafoate and FluticasonePropionate Powder for Inhalation
Category 4 chemical medicineIndacaterol Maleate Powder for InhalationCategory 4 chemical medicineInhalationaerosol
Budesonide AerosolCategory 4 chemical medicineIpratropium Bromide AerosolCategory 4 chemical medicineNasal sprayMometasone Furoate Nasal SprayCategory 4 chemical medicine
2. R&D E?orts in Bio-Pharma Market
Livzon Bio, a subsidiary of Joincare, keeps exploring biomedicine. It has built mature technology platforms for antibodymedicines, fusion protein medicines, cell therapy medicines, etc., dedicating to the development and industrial production ofcancer, reproduction and autoimmunity-related products.Livzon Bio, focusing on cancer, reproduction and autoimmunity, has launched a number of R&D projects for monoclonalantibodies, recombinant proteins, ADC and CAR-T which are at different R&D stages from preclinical study, clinical studyto the application for production. In addition, Joincare will speed up the approval of new products through independent R&D,external introduction, strategic cooperation and other channels. In order to further improve promedicine technology and enhancecommercial production, Joincare is intended to diversify the innovative portfolio of individualized cancer immunotherapy andcombinedtherapy,andexpandbispecic/polyspecicantibody,ADCandothertechnologyplatforms.
Progress of Livzon Bio's Major Products under R&DFieldDrug Code (Full Name)Preclinical
Application forClinical Trial
PhaseIPhaseIIPhaseIIIMarketingApprovalVaccineV-01（Recombinant SAS-CoV-2 Fusion Protein Vaccine）Tumorimmunology
A-01(RecombinantTumorEnzymeSpecicInterferonα-2bFcFusion for Injection)
LZM009 (Recombinant Humanized Anti-PD-1 Monoclonal Antibodyfor Injection)
Reproduction
LZM003 (Recombinant Human Chorionic Gonadotropin Alfa forInjection)Immunediseases
LZM008 (Recombinant Humanized Anti-human IL-6R MonoclonalAntibody Solution for Injection)
LZM012 (Recombinant Anti-human IL-17A/F HumanizedMonoclonal Antibody Injection)
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Joincare
SOCIAL RESPONSIBILITY REPORT 2020
3. Planning in Long-acting sustained-release microspheres
Livzon Microsphere, a subsidiary of Joincare, focuses on the R&D of anti-tumor, endocrine-regulating and antipsychoticmicrosphere formulations which are advantaged for their long-acting and sustained-release mechanism. By the end of thereporting period, Livzon Microsphere has 5 ongoing projects and multiple ongoing exploratory studies. In 2020, we have twonewmedicinesinourpipelinenishedtheirpre-clinicalresearchandgoto?cialnoticationsforclinicaltrialsandonemedicinegot authorization for clinical trial; among those R&D progresses mentioned, one medicine is at stage I of the clinical trial and onemedicine ’s clinical BE trial has been initiated.
Progress of Joincare's Major Sustained-release Microsphere Products under ResearchProject NameIndicationPreclinical
Applicationfor ClinicalTrial
PhaseIPhaseII
PhaseIIIBETrialNDATriptorelin AcetateMicrospheres for Injection
Prostate cancer; precocious puberty;endometriosis (stages I to IV); femaleinfertility; preconditioning of uterinebroidsbeforesurgery
>>>>>>>Aripiprazole Microspheresfor Injection
Schizophrenia, bipolar disorder
>>>>>>>Octreotide AcetateMicrospheres for Injection
Acromegaly; gastroenteropancreaticneuroendocrine tumors
>>>>>>>
Triptorelin PamoateMicrospheres for Injection
Treatment of locally advanced ormetastatic prostate cancer
>>>>>>>
Goserelin AcetateSustained-Release Depot
Prostate cancer: It is indicated forprostate cancer for which hormonetherapy is available.Breast cancer: It is indicated forbreast cancer in premenopausal andperimenopausal women for whomhormone therapy is available.Endometriosis: It is indicatedto alleviate pain and to relievesymptoms of endometrial lesions.
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4. Setup of Nano-lipid Microemulsion R&D Platform
Although it is very difficult to put lipid microemulsion, such a high-end complex preparation, into massive production stage,this market niche enjoys a broad market prospect in parenteral nutrition and medicine-loading technology. Given this, Joincarehas cooperated with domestic top-level teams in this regard to develop a number of varieties successively. During the reportingperiod,Joincarehasmadeabreakthroughthataregistrationapprovalwasobtainedfortheblockbuster,ω-3-FishOilMediumandLongChainFatEmulsionInjection,markingasuccessfulscienticachievementtransformationofnano-lipidmicroemulsion.Atpresent, Joincare has a series of special fat emulsion varieties and medicine-loaded fat emulsion projects under research, aimingfor a more diverse lipid microemulsion product line.
Case: ω-3-Fish Oil Medium and Long Chain Fat Emulsion Injection (Jiankeda?) Approved for MarketingIn December 2020, Joincare received the RegistrationCertificateforω-3-FishOilMediumandLongChainFat Emulsion Injection from National Medical ProductsAdministration. The cumulative expenses of about RMB
34.9356 million have been directly input to the R&D of this
variety.ω-3-FishOilMediumandLongChainFatEmulsionInjection is jointly developed by Joincare and Shanghai Instituteof Materia Medica, Chinese Academy of Sciences. Joincareis the first domestic manufacturer to receive the registrationcertificateofω-3-FishOilMediumandLongChainFatEmulsion Injection, and to be approved for the manufacturingoffatemulsioninjectionswithshoilasthemainrawmaterial.Compared with traditional medium and long chain fatemulsions,thisproductisaddedwithω-3-acid-triglycerides,which are rich in EPA and DHA to reduce the inflammatoryresponse caused by the use of soybean oil, so as to shortenthe length of hospital stay of patients. In addition, medium-chaintriglycerides,soybeanoilandω-3-acid-triglyceridesareprescribed in a proportion to optimize medicine hydrolysis, as afasterhydrolysisrateleadstofewertoxicandsidee?ects.
5. Paying Attention to Rare Diseases
High treatment costs in rare diseases result from their extremely low incidence rate (0.65~1‰) and low market demand as well as lackof experience in clinical medication. Meanwhile, unknown causes pose a great challenge for research so that there is no medicine fora large number of rare diseases. Currently, there are nearly 7,000 globally recognized rare diseases. In China, there are more than 20million patients with various rare diseases, while there are only 55 medicines with approved indications on the market. The treatmentof rare diseases is facing unprecedented challenges.Under the guidance of relevant policies such as the "Healthy China 2030" Planning Outline and the Guidelines for Diagnosis andTreatmentofRareDiseases,We,basedonourownscienticresearchsystemandcapabilities,continuouslyinvestinresearchonrarediseases, work with peer enterprises to improve the current situation of diagnosis and treatment of rare diseases in China, and thusmaking contributions to enhancing the health of all the people and building a Healthy China.Malignant hyperthermia, a rare fatal syndrome caused by anesthetics, has an extremely high mortality. Dantrolene Sodium forInjection is the only specific medicine for the treatment of the disease. Due to the high cost and short shelf life, the medicine is notavailable for the majority of medical institutions in China, leading to the death of patients because of ineffective rescue measures.Livzon Pharmaceutical Group, a subsidiary of Joincare, began to plan the R&D of the medicine in the early days. After over a decadeof arduous exploration, it obtained the medicine registration certificate of Dantrolene Sodium for Injection issued by the NationalMedical Products Administration in October 2020. The first domestically produced Dantrolene Sodium for Injection has broughtgood news to the vast number of anesthetists in China and also marks major progress in the diagnosis and treatment of malignanthyperthermia in the country.At the same time, Livzon Pharmaceutical Group is also continuously investing in the R&D of Octreotide Acetate Microspheresfor Injection, a medicine for rare diseases such as acromegaly and gastroenteropancreatic neuroendocrine tumors (GEP-NET). It isconservatively estimated that there are 70,000 acromegaly patients in China. Due to the technical difficulty of mass production, thehigh R&D cost and long R&D cycle, the high dependence on import and the high price, there is urgent demand for a domesticallyproduced medicine. Based on this situation, Livzon Pharmaceutical Group made active plans. In September 2020, the subsidiaryobtained the approval for clinical trials of Octreotide Acetate Microspheres for Injection issued by the National Medical ProductsAdministration, which allowed bioequivalence (BE) studies to be conducted on healthy people in contrast with the brand-namemedicines; this has brought our product Octreotide Acetate Microspheres for Injection for domestic mass production.
6. Protecting Intellectual Property Rights
Joincare attaches great importance to the protection of intellectual property rights, strictly abides by the Patent Law of the PRCand the Trademark Law of the PRC, the intellectual property right department of the Group continuously improves the intellectualproperty right management system, organizes and carries out patent risk assessment before product project initiation approval,transformation of R&D achievements into patent, patent risk response of products before launching as well as article reviewsbefore publication, and regularly carries out intellectual property protection publicity to improve the enterprise's capabilities ofcreating, utilizing, protecting and managing intellectual property rights. In 2020, Joincare actively reports key cases of intellectualproperty rights (IPR) through the website, posts, monthly, and Yuanxuetang (i.e.元学堂), our internal platform for employeetraining. The themes have covered cases that illustrate the importance of intellectual property rights of patents, patent writing,patent search and analysis, invalid patent cases analysis, etc. We have also sent the managers to participate in education activitieson IPR held by city, provincial, and national governments, to enhance their professional development, learning more aboutpatent quality, patent portfolio arrangement and early warning, strategic management, judicial protection, foreign-related issues,investment and operation, the IPR policies in the Guangdong-Hong Kong-Macao Greater Bay Area, and other subjects.
By the end of the reporting period, Patent applications by Joincare and its subsidiaries totaled 826, with 543 Chinese patents and558 granted. 320 inventions were patented domestically. International patent applications were 71, among which 48 were granted,and 18 are PCT applications. The efforts we've put in patent management and IPR protection have been highly approved. In2020, Joincare has made itself prominent from all the model enterprises in passing the national annual assessment of IPR. Oneof our IPR managers was granted "Excellent IPR Manager Award" by the China Nation Intellectual Property Administration, andTaitai Pharmaceutical (Shenzhen Taitai Biotechnology Co., Ltd) was rated as "Model Company on Intellectual Property Rights ofGuangdong 2020".
Joincare Was Rated as "National Model Enterprise on Intellectual Property Rights" and
"National Top Enterprise on Intellectual Property Rights"
Case: "Weekly Lectures on Invalid Cases" at JoincareJoincare organizes lectures on invalid cases weeklyfor the R&D staff. With commentary and guidancefrom IPR experts, they can learn, lecture on, and shareinvalid pharmaceutical patents, so as to not only deepentheir understanding and skills of patent applicationand writing but also comprehend intellectual propertyrights better. In this way, the horizons of the Group forhandling IPR issues would be broadened.
In December, 11, 2020, the Guangdong IP Protection Association published the result on rating "Model Company on IntellectualProperty Rights of Guangdong 2020". After being critically accessed by the expert panel, Taitai Pharmaceutical, bragging excellentinnovative competence and a well-established IP management system, was rated as the IPR model company for 2020.
Moreover, Joincare values innovation and tends to reach foreign markets. In the future, we will promote our pharmaceutical products,especially pharmaceutic reagents, in overseas markets, and play a part as far as possible in the Doha Declaration on the Trade-RelatedAspects of Intellectual Property Rights (TRIPS) Agreement and Public Health. If some third-party invites us to provide our productsfor the least developed and low-income countries, Joincare will license our product patents on a proper and conditional basis.
Taitai Pharmaceutical Was Rated "Model Company on Intellectual Property Rights of Guangdong 2020"
7. Promoting Industrial Development
Joincare aspires to be a trail breaker of the healthcare industry, and has explored in all fronts how to develop the section of inhalationmedicine products, aiming to change the huge domestic market dominated by foreign monopolies with innovator medicines, and thiswill contribute to the development of domestic inhalation medicine production industry. At the meantime, in order to advance commondevelopment,Joincarefocusesonforefronttechnologiesofthepharmaceuticaleld,andhasextendedintra-industrialcommunicationand cooperation in this aspect.Case : Push Forward Standard Setting for Respiratory Medicines IndustryDoctor Jin Fang, Chief Scientist for Joincare, is one of the leaders who understand best about the key R&D andindustrializationtechnologiesofsomeintractableinhalationmedicineproductsandwhohasbuiltaglobalinuence.Hehasplayedasignicantpartthroughoutthedevelopmentoftheinhalationmedicineproductionindustryformnaughtandthe industry standard setting and took charge in drafting Pharmacopoeia of the People’s Republic of China 2000, 2010,2015 and 2020, and general rules and related determination methods for respiratory medicines.During the reporting period, Joincare’s subsidiary Shanghai Frontier has drafted Guidance for Extractable Study onPackaging System of Inhalation Aerosols as the inhalation medicine production standard (STANDARD NO.: T/CNPPA3007-2020).TheGuidancewaso?ciallypublishedandputintopracticeonMarch16,2020,andhasprovidede?ectiveguidance for related extractable study of the industry.
(II) Improving the Accessibility of Medicines
Joincare has prioritized Access to Health Care into to the top issues of corporate social responsibility management. We endeavorto improve availability and affordability of medicines, and advocate for rational use of drugs. Since Joincare mainly operateswithinChina,whichisalsoadevelopingcountry,theeconomy,thehealthcarelevel,anddiversiedfeaturesofforeignmarketsare taken into accounts when the inclusive medical strategy is formulated.
1. Improving Healthcare Accessibility
Joincare entered emerging markets mainly via direct operation, along with majority-owned distributors in some regions. So far,products of the Group and the holding companies have been approved after registration in more than 90 countries and areaswithin Asia, Europe, North America, and Africa.To improve medical availability, Joincare expands products’ production and marketing overseas, gaining consecutive growth in itsmain business revenue in foreign markets. In 2020, it reached 2,660.47 millions, with a year-on-year rise of 40.41% and a 5-yearcompound growth rate of 16.14%.
Case: Holding 2020’s Annual Academic Meeting with Pharmaceutical EngineeringProfessional Committee, CPAIn November, 2020, as one of the organizers, Shanghai Frontier held2020’s Annual Academic Meeting with Pharmaceutical EngineeringProfessional Committee, Chinese Pharmaceutical Association(CPA), in which the conferees have discussed the status quo andtrend of the pharmaceutical industry against a new administrativebackdrop, and tried to build a way linking academic research andpharmaceutical production. They have centered on and carried outfull interpretation on the industrial polices, hotspots issues, cutting-edge technologies, industrialization research, and also currentdevelopment of the high-end technologies. Many academicians inpharmaceutical engineering and experts from enterprises, of science and education were invited to the meeting for an in-depth idea exchange on the latest and most challenging issues in the pharmaceutical industry. It offered an opportunity fordiscussion and communication in the industry, thereby promoting the industrial evolution and technological progress.
20172016
1,894.762,660.471,763.841,511.441,258.85
2000.001500.001000.00
500.00
0.00
20.00%
19.00%
18.00%
16.00%
15.00%
14.00%
13.00%
12.00%
2018
Joincare's ratio of overseas business revenue to total revenue in 2016-2020
20202019
15.02%
16.43%
15.81%
15.92%
19.79%
Overseas business revenue (RMB 1,000,000) Ratio of overseas business revenue to total revenue
2. Improving Medical A?ordability
In active response to admission to the medical insurance list, Joincare has made efforts to provide fairly-priced and high-quality medicines to patients. In the National Reimbursement Drugs List (NRDL) published by the National Healthcare SecurityAdministration in 2020, Joincare has 196 products included, among which 97 are Class A and 99 are Class B. LevosalbutamolHydrochloride Nebulizer Solution, a Joincare’s original, was incorporated into the medical insurance negotiation list in 2020. Ithaslesssidee?ectscomparedwithsalbutamol,acommonly-usedrstaidforasthmaandCOPD,andcangreatlyimprovepatients’pulmonary function, thereby lowering the risks of them having to be hospitalized and re-hospitalized, or shortening hospital stays.Therefore, this medicine is a new, safe, and useful choice for patients.When entering into overseas markets, Joincare comprehensively considers local economy, healthcare level, price benchmarking too?erafairpricingandhencea?ordablemedicinesequitablepricingofpromotingourproductsindevelopingareasoverseas,itisafteradequateassessmentonlocalpercapitaincomethatdi?erentialpricingstrategieswereprovided.Joincarealsopositivelygoesforbiddingoflocalgovernments,sothata?ordablemedicineswouldbeo?eredlocally.Sofar,Joincareandthesubsidiarieshaveuseddi?erentialpricinginsellingofsevenproductsinSoutheasternAsiaandMiddleAsia,formatchingthelocalincomelevel.
3. Advocating for the Rational Use of Medicines
Popularizing Knowledge on Chronic Disease and Promoting Rational Medicine UseRespiratorydiseasesrankamongtopvediseasesofChinaandalsointheworld.Itsprimarydiseasesincludeasthmaandchronicobstructive pulmonary disease (COPD) which is the third cause of death around the world. However, the diagnosis rate and theawareness rate of asthma and COPD are now far behind the goal made in Healthy China Initiative 2019-2030, and the numberof patients are seriously under-estimated. With measures such as academic promotion and spread of knowledge about diseases,Joincare endeavors in many ways to teach public about asthma and COPD and appeals for regular pulmonary function tests,pushing forward the initiative for a healthier China. Inhalation medicine products, as the most preferred treatment for asthma andCOPD,featuregoodcomplianceandhightherapeutice?ect.Moreover,intheR&Dprocess,theformula,particles,anddesignofthe inhalation apparatus have been taken into consideration to ensure that patients can administrate themselves outside the hospital.The products are designed to be even, steady, and precise, meanwhile they are more portable and operable. Besides, effectivemedicine use is promoted through holding academic meetings and product introduction at terminals, thereby educating patientsabout how to correctly use inhalation medicine products and ensure medication safety.Addressing Antimicrobial Resistance (AMR)Joincare has a very mature anti-infection product portfolio, such as meropenem for injection, voriconazole for injection, andcefodizime sodium for injection. Since the management policy for clinical use of antimicrobial medicines was issued in 2020,Joincare has greatly emphasized judicial use of antibiotics. We have strengthened management of prescription medicines duringselling and cooperated with medical institutions to classify antibiotics and limit physicians' prescription rights. The classifyingof antibiotics for clinical use has been strictly followed in Joincare, as we enforce non-limited use, limited use and special use,cooperate with hospitals to handle antibiotic abuse and help with the work on controlling medicine-resistance bacteria. Traininglessons and lectures on optimizing medicine-resistance bacteria treatment scheme are given to improve clinical use of antibioticsand reduce misuse.In 2020, Joincare has sponsored many nation-level academic meetings on AMR, for example, the 4th Academic Conference onFungal Infection and Host Immunity held by Professional Committee of Mycology, Chinese Society for Microbiology. In theconference, Joincare has made in-depth communication with clinical experts in infection, respiration, hematology, ICU, organtransplantation, dermatology, obstetrics and gynecology, etc. and researchers on fundamental microbiology, striving to jointlyadvance the development of medical care.
Health Responsibility
(I) Product Quality Control Mechanism
1. Managing Quality System
According to the Drug Administration Law of the People?s Republic of China, the Good Manufacturing Practice forPharmaceutical Products (GMP), the Good Supply Practice for Pharmaceutical Products (GSP) and other related laws andregulations, Joincare has established its own quality management system, including regulations on managing lifecycle safetymonitoring, quality assessment standard, quality review, quality data trend analysis and review, quality risk, etc., so that the wholesystemcane?ectivelyfunction.During the reporting period, Joincare had nearly 60 varieties of APIs and preparations in production being registered in more than120 countries (or regions) over the globe. Overall registration and certification of Joincare's APIs, preparations, and diagnosticreagents are shown as follows:
Project2020 Work Review
GMPCertication
41productionlinesof8preparationcompanieslicensedGMPcerticates2productionlinesof1reagentcompanylicensedGMPcerticates37varietiesof6activepharmaceuticalingredientcompanieslicensedGMPcerticates,with5licensedGMPcerticatesforveterinarymedicinesmanufacturers
International
QualityAuthentication
ActivePharmaceutical
Ingredients
17varietiespassedon-siteinspectionofinternationalcertication49licensedinternationalcerticateswithvalidityperiod(amongwhich4varietiesareon-siteinspectedbyFDAand13varietiesarewithCEPcerticates)2licensedsystemqualicationcerticates(ISOsystemcertication)Preparations
1varietypassedinternationalcertication2licensedinternationalcerticates2licensedqualicationcerticates(ISOsystemcertication)DiagnosticReagents
8varietiespassedinternationalcertication1licensedinternationalcerticates8 varieties passed on-site TUV inspection1licensedqualicationcerticates(ISOsystemcertication)
The quality management department of Joincare has made an annual quality auditing plan according to the Group's auditingmanagement regulations and the GMP self-inspection checklist. Six systems of quality control, production, documents, materials,labs, and equipment have been built based on the GMP standard, to conduct overall auditing in every production and operationunitforatleastonceayear.Apartfromthat,specicauditingisconductedfromtimetotimebasedonmanagementdemandsandexternal supervision changes. The auditing plan covers all the producers, operators, and R&D institutions, and can facilitate all thesubsidiaries to cooperate with various external quality audits and improve quality management in combination with the advice ofexternalexperts.Duringthereportingperiod,Joincarepassedalltheo?cialinspectionsandexternalaudits.
Case: Quality Culture Building for 2020 in Joincare HaibinFrom July to September 2020, Joincare Haibin held a quality culture building activity in which all staff participated.With the needs to build the quality system and the goal of "high quality", there were banner making, post design, creatingquality slogan, experiment skill contest, hygienic dress changing, lessons clock-in, inspection quiz, and other activities forallthesta?tostrengthentheideaandworkdisciplineof"qualityrst".
"Let me try to inspect" Quiz Some quality slogans selected
Case: On-site Audit in Production Enterprise
In August, 2020, the quality management departmentof the Livzon Group conducted an on-site audit inthe Limin Pharmaceutical Factory.
2. Quality Risk Management
According to the laws, a marketing authorization holder is responsible for its medical products' non-clinical study, clinical tests,marketing and operation, post-marketing management, adverse reaction monitoring and response. On the premise of complyingwith the Good Laboratory Practice for Pharmaceutical Products (GLP) and the Good Clinical Practice for PharmaceuticalProducts (GCP), Joincare ensures its development quality by following ICH guidelines such as the pharmaceutical quality systemICH Q10, adopting the Quality Target Product Profile (QTPP), the Failure Mode and Effects Analysis (FMEA), the HazardAnalysis Critical Control Points (HACCP), and other risk management tools in the R&D phase to determine products' criticalquality attributes (CQAs) and critical process parameters (CPPs).In the production procedure, Joincare abides by the GMP and has built systematic risk management and data integrity assessment,etc. We use beforehand and backtracking manners to assess our analysis tools and spot risks lying in man's work, machines,materials,rules,links,andtestswithFMEA,HACCP,brainstorming,cause-and-e?ectdiagrams,5Whys,andthelike.Further,we take corresponding measures to mitigate or eliminate the risks. Other risks are further assessed, analyzed, and discussion andreviewareconducted,toensuresafety,e?ectiveness,andcontrolqualityofourproducts.For post-marketing management, Joincare properly receives, surveys, confirms and reports quality complaints and adversereaction information according to the customer complaint handling procedure, the adverse medicine reaction handling procedure,and the medicine safety accident handling procedure. Product recall simulation for preparations and active pharmaceuticalingredients are exercised every year at Joincare, to ensure that our recall system is effective. We also implement a productrisk management scheme to ensure risk management of post-marketing products is in line with the GMP, the GSP, and relatedpharmacovigilance laws, and ensure that the products' qualities always serve their uses and satisfy the registration requirements.
3. Pharmacovigilance Management
To build a full-scale pharmacovigilance system, Joincare has set up a medicine safety committee, issued a guideline for managingthe medicine safety assessment committee, and specified the working structures, duties and coordination mechanism of thepharmacovigilance works. The goal for pharmacovigilance has also been set, and the whole procedure of pharmacovigilanceis systematically guided by the goal and corresponding requirements by carrying out the quality planning, compliance, control,assurance and improvement activities.Joincare's prescription medicine department takes responsibility for analysis and relevance evaluation of major adversereactions or issues. It detects major underlying safety incidents and assesses risks or gains based on the Guidelines for ReportingSpontaneous Adverse Medicine Reaction of Post-marketing Products. Relevant departments, according to regulations, collectadverse medicine reactions and cases thereto through various methods, and analyze them with monitoring materials afterreporting. Then medicine safety assessment will be conducted, results and impacts of which will be the basis of formulatingcorresponding risk control measures. Apart from that, Joincare has built a e-review code medicine management system, includingcode application, printing, detection, collection, storage, delivery, and extra scenarios like returns, sample testing, etc., therebyensuring the e-monitoring system is applied in the whole operating process. On-code services have also been open to all thesubsidiaries. Tracker codes are used for downloading and printing in daily production. Packages with codes are scanned forstorage and uploading, and deliveries also use codes for real-time uploading. In this way, every link of products' circulation willbe traceable.
4. Legal Compliance of Business Operations
Pharmaceuticalproducersandoperatorsareobligedtoprovideobjective,accurate,andscienticproductinformationtopatients.Therefore, according to the legal requirements on medical products' package inserts, labels and inserts of Joincare's productsall are examined by the National Medical Products Administration. In December 2020, the quality management departmentof Joincare started a training course on illustrating the Provisions for Medicine Insert Sheets and Labels. During the training,duties of every department were specified and required to be carried out strictly as regulated. In the process of promotion, theprescriptionmedicinedepartmentofJoincarehascarefullyreviewedproductspecicationsoftheprescriptionmedicinesalreadyon the market and publicity materials made by the marketing department as well, to make sure that key information is consistentwiththespecicationsandthereforeproductinformationcanbeproperlyande?ectivelytransferredtohealthcareprovidersandpatients.
5. Supply Chain Management
According to the Supplier Management System, the Group carries out standardized management on supplier on-boarding,maintenance and evaluation in order to address product safety and quality assurance related issues. In the on-boarding stage,based on the principle of fair bidding, dual sourcing procurement and quality first, the quality assurance department conducts acomprehensive evaluation on the suppliers of materials to be purchased. Their comprehensive performance in supply stability,quality control, environmental and safety management capabilities will be evaluated through on-site quality audits, regular writtenquality audits and questionnaire feedback. Partners included in the list of qualified suppliers shall sign the Procurement ContractandtheQualityAssuranceAgreement,whichdenetheirresponsibilitiesofqualityassuranceintheprocessofmaterialsupply,soas to ensure that they can supply high-quality production materials in a stable manner.Each production subsidiary of the Group implements hierarchical management on suppliers. According to the safety of rawmaterials and excipients supplied, whether the materials have a direct impact on the medication safety of patients, the risk degreeof impact on product quality and other factors, suppliers are rated at three levels, namely H/M/L (or A/B/C). One or two potentialsuppliers of major materials are reserved as the contingency plan for supply risks.Inordertofurtherguaranteethestabilityandqualityofsupply,theGroupconductsscienticreviewsonsuppliers'qualications,production sites, technologies, quality assurance systems, etc. according to such systems as the Supplier Quality ReviewManagement and the External Review Management. The quality assurance department formulates an annual supplier audit plan,carries out at least one on-site audit on level H (or A) suppliers every two years, and communicates with all major suppliers andsuppliers of excipients or packaging materials through written questionnaires or regular written quality audits, so as to ensure thedepartment has a timely understanding of all suppliers' management.
Figure: The Group's supplier audit dimensionsDuring the reporting period, the quality management department of the Group carried out questionnaire audits and on-site auditsaccording to the annual supplier audit plan, and completed nearly 260 on-site audits.In addition to the quality of suppliers' products, Joincare also pays continuous attention to the management of suppliers inenvironment, health and safety (EHS), and is committed to improving the EHS management together with long-term suppliers.During the on-site audits, we shared the EHS regulations and the industry trends with suppliers, distributed the EHS questionnairestothem,encouragedthemtoactivelyobtainISO14001:2015/ISO45001:2018andothermanagementsystemcertications,assistedthem in improving EHS management and long-term stable cooperation, ensured the quality and safety of products in the entirecycle and reduced the EHS risks. As of the end of the reporting period, more than 60% of the suppliers have passed the EHScerticationasrequiredbytheGroup.
Supplier Audit
QualieationsPersonnel and Organization
Plant Facilitics and Equipment
Quality Control and Quality Assurance
Production ManagementMatcrials Management
EHS Management
(II) Ensuring Production Safety
1. Occupational Safety Management
With the goal of "zero safety and environmental incident and zero occupational disease ", Joincare strictly abides by the nationallaws and regulations such as the Law of the PRC on Work Safety, the Fire Control Law of the PRC, as well as the Law of the PRCon Prevention and Control of Occupational Diseases, complies with the requirements of the international occupational health andsafety management system standards, and formulates management policies such as the Work Safety Management by Objectives,the Safety Management System Operation Control Management and the EHS Accident Management Methods to define the safetyresponsibilitiesoftheGroup'ssta?atalllevels,promotethesafetymanagementlevelbylevelandensuretheworksafety.Joincare continuously improves the Production Safety management system. In 2020, Livzon Pharmaceutical Group, a holdingsubsidiary of Joincare, added the Regulations on Punishment concerning Production Safety, the Annual Performance AssessmentStandards for the Secondary Enterprises of Livzon Pharmaceutical Group, the Production Safety Training Management Systemand the Production Safety Accountability Management System; Jiaozuo Joincare added the Double Prevention OperationAssessment System and the Safety Change Management System; Taitai Pharmaceutical added the Management of PrecursorChemicals and the Management of Emergency Materials; all subsidiaries revised the EHS Assessment Management Regulations,the Safety Production Responsibility Management System and the Occupational Health and Safety Protection and ControlProcedures respectively to further implement the requirements of Production Safety management.During the reporting period, no major safety accidents occurred in the Group.As of the end of the reporting period, all production subsidiaries of the Group have passed the ISO45001/OHSAS18001Occupational Health and Safety Management System certification, with a coverage rate of 100%. In accordance with therequirements of the system, the surveillance audit has been carried out once a year and the renewal audit has been carried outevery three years. Jiaozuo Joincare and Xinxiang Haibin have passed the ISO45001:2018 Occupational Health and SafetyManagementSystemcertication,andotherproductionsubsidiariesalsoplantoadoptnewstandardsinthenextrenewalaudit.We adhere to the principle of advance prevention and integrate intrinsic safety management into the work safety system. Bycontinuously updating production equipment and adding the work safety automation systems, starting from the production line,we identify risk points, control dangerous points, prevent work safety accidents caused by human-made mis-operation, andoptimize intrinsic safety design.Case: Jiaozuo Joincare added the DCS, theSIS and the nitrogen sealing system
Case: Xinxiang Haibin investigated andresponded to the Production Safety risksIn 2020, Jiaozuo Joincare added the DistributedControl System (DCS), the Safety InterlockingSystem (SIS) and the nitrogen sealing system. Theautomatic control of the DCS and the SIS as well asthe operation of the emergency cut-off system helprealize automatic operation, reduce the WorkplaceSafety accidents caused by human-made mis-operation, and realize the functions of emergencyprevention and automatic cut-off before theoccurrence of Production Safety accidents to controlthe accidents in the bud. The operation of the nitrogensealing system helps realize the safety protectionof the storage tanks and pipelines of hazardouschemicals by nitrogen, completely isolate them fromair and realize the intrinsic safety design.
· Carried out two lightning protection and anti-static
tests, and found that all the test indicators on theproductionsitewerequalied;· Carried out chemical reaction safety risk assessment;· Added five emergency rescue material stations andnine mobile foam vehicles;· Supplemented the equipment in the fire controlroom of the company and equipped seven full-timereghters;· Conducted the annual test of the gas alarm probes,thealarmsystemandthereghtingelectricsystem,and replaced 69 sensors for the gas alarm probes.
2. Safety Culture Development
Joincare always regards the construction of safety culture as the foundation of the enterprise, embeds the safety idea deeply inthe mind of employees, helps them change from "I'm required to be safe" to "I want to be safe", and forms a good safety cultureatmosphere through safety training, safety drills, group safety day, special activities for Production Safety, etc.Joincare formulates the comprehensive emergency plan and the special emergency plan for Production Safety, and sets upemergency rescue teams that can carry out emergency rescue, emergency evacuation, medical rescue, logistics support andcommunication. Each production subsidiary carries out regular drills according to the annual emergency drill plan, and improvestheemergencyplananddisposalplanaccordingtothedrille?ectevaluation.In 2020, the EHS management department of Joincare organized all subsidiaries to carry out regular drills according to the annualemergencydrillplan,andimprovedtheemergencyplananddisposalplanaccordingtothedrille?ectevaluation.Case: Joincare Haibin carried out a series of "work safety month" activities
From May to June 2020, in order to ensure work safety, deeply implement the New Work Safety Law, adhere to the worksafety principle of "safety first, emphasis on prevention and integrated governance" and follow the "people-oriented"safety concept, the EHS Department of Joincare Haibin Pharmaceutical actively responded to carry out a series of "worksafety month" activities.· Safety publicity: set up work safety month theme publicity boards and post safety culture publicity posters; carry out
"work safety accident warning video" watching activities to strengthen safety awareness through accident education;· Fire safety: organize training on basic fire-fighting knowledge and popularize fire safety knowledge; carry out theactivityof"emergencyrescueexerciseforre-ghtingandleakageofhazardouschemicals"toexplainhowtousereextinguishersandrehosesandpracticallyoperatethem;· Work safety: carry out the activity of "emergency exercise for steam pressure pipeline leakage" to improve the
emergency response capacity; carry out the activity of "emergency exercise for sulfuric acid leakage accident" to focus
on the danger of the acid preparation work and the dos and don'ts during the use of sulfuric acid and hydrochloric acid;· Safety inspection: carry out a comprehensive pre-festival safety inspection for workshops and the phase II construction sites.
Theworkshopinspectionfocusesonelectricalsafety,theuseofhazardouschemicalsandre-ghtingfacilitiesinworkshops.
Emergency Rescue Exercise for Fire Fighting and Leakage
of Hazardous ChemicalsSafety Publicity and Safety Culture Publicity Posters
Emergency Exercise For Sulfuric Acid Leakage AccidentEmergency Exercise for Steam Pressure Pipeline Leakage
According to the requirements of the Safety Education and Training Regulations, Joincare formulated the annual safety trainingplan, improved all employees' safety supervision and management ability through the combination of internal and externaltraining, and ensured long-standing insistence on Production Safety. It promoted the overall improvement of health and safetyawarenessofallemployeesbycarryingouttargetedsafetyeducationpublicityforemployeesofdi?erentlevelsandcategories.During the reporting period, the per capita training time for EHS training was about 58 hours.Internal training: three-level (plant-level, workshop-level and team-level) safety education and training for new employees,safety management personnel training, daily education and training for employees, etc. The training includes national laws andregulationsonworksafety,worksafetymanagementsystemandbasicknowledge,worksafetytechnology,resafety,analysisoftypical accident cases, accident reports and investigation and handling methods, as well as occupational hazards and preventivemeasures.External training: training for special operations (such as electric welders and chlorination process operations), qualificationtraining for safety management personnel, etc. Employees can only take up posts after being trained and obtaining thecorrespondingcerticatesissuedbythecompetentgovernmentdepartments.
Case: Methanol Leakage Comprehensive Emergency Exercise of Jiaozuo Joincare
Case: Emergency Exercise of Livzon Group Ningxia Pharmaceutical Co., Ltd.
On June 18, 2020, Jiaozuo Joincare organized the"Methanol Leakage Comprehensive EmergencyExercise" targeting the major hazard source of methanolleakage. The exercise involved six departments andworkshops, and more than 50 participants. It practicedthe synergy and coordination of emergency teams,tested their response capacity to emergencies andveriedthefeasibilityofthecomprehensiveemergencyplan.
In 2020, Livzon Group Ningxia Pharmaceutical Co., Ltd. carried out 97 comprehensive, special and on-site emergencyexercises, involving a total of 1,906 participants and with a completion rate of 94.8%. It highlighted the initial emergencydisposalatprimaryproductionpoststonipinitialaccidentsinthebudande?ectivelycontroltheexpansionofaccidents.It also timely improved and solved exposed problems in the exercise and improved disposal measures and procedures.
Joincare
SOCIAL RESPONSIBILITY REPORT 2020
3. Occupational Health Protection
In accordance with the Law of the People's Republic of China on the Prevention and Treatment of Occupational Diseases and theTechnicalSpecicationsforOccupationalHealthSurveillance,JoincareformulatedtheOccupationalHealthManagementSystemand Operating Procedures, and the Monitoring and Evaluation System for Occupational Hazard Factors in the Workplace to carryout the monitoring and risk assessment of occupational hazard factors in toxic and harmful posts and continuously improve thelevel of occupational disease prevention and control by publishing the monitoring results, setting up warning signs, equippinglabor protection articles and first aid supplies and carrying out occupational health examinations so as to effectively ensure theoccupational health of employees in the production process.In 2020, Joincare continued to invest in occupational health protection for employees and built special funds for labor protectionarticles procurement, occupational health monitoring and physical examination; regularly maintained and overhauled protectivefacilitiesandimprovedtheire?ectiveutilizationrate.Duringthereportingperiod,itdidnotseenewoccupationalcontraindicationsor occupational cases.Case: Shenzhen Haibin's Installation of LocalExhaust Devices
Case: Evaluation of Occupational HazardControl E?ect of Jiaozuo Joincare
Case: Xinxiang Haibin Workplace Safety MonthArt Show
Case: Production Safety Assessment of ShenzhenHaibinIn May 2020, Shenzhen Haibin organized thepersonnel in middle management such as the heads ofworkshops and auxiliary departments to carry out awritten examination on Production Safety knowledgein a centralized manner. Through the examination, itreminded the heads of all departments to improve theirown Production Safety awareness and implement theirmain responsibility for Production Safety.
Shenzhen Haibin set up a laser coding room in thepowder sub-packaging production line. During lasercoding, the laser burning always produces a peculiarsmell, causing employees to easily suffer discomfortdue to long-term contact. Shenzhen Haibin adoptedthe local installation of exhaust devices to extract thepeculiar smell and discharge it after the treatment bywaste gas treatment device, which improves the workingenvironment and reduces occupational health risks.
In order to prevent, control and eliminate the occupationalhazards that may be caused in the construction project,and strengthen and standardize the supervision andmanagement of the construction of occupational diseaseprevention facilities in the construction project, JiaozuoJoincare carried out pre-evaluation of occupationalhazards, special review of occupational disease preventionfacilities design and evaluation of occupational hazardcontrol effect for the two new projects in 2020, andobtained corresponding reports in August and December2020 respectively after passing the expert review.
On June 30, 2020, in order to improve Production Safetyawareness, Xinxiang Haibin organized a safety art showwith the theme of "eliminating hidden dangers of accidentsand building a stronger line of defense for safe." Eachactivity team carefully arranged shows and performedon the stage. This show consolidated and deepenedemployees' mastery of safety knowledge and mobilizedeveryone's enthusiasm for learning safety knowledge
(III) Promoting Social Health
1. Caring for Patients with Chronic Disease
By virtue of the advantages of its main business, Joincare has been working with its holding subsidiary Livzon PharmaceuticalGroup since 2018 to continuously practice the chronic disease poverty alleviation public welfare project, in order to provideassistance for middle-aged and elderly poor people with chronic diseases such as hypertension, hyperlipidemia and cardio-cerebrovascular diseases in targeted poverty-stricken areas and contribute to healthy China. During the reporting period, wesuccessively carried out chronic disease poverty alleviation projects in five areas including Jiange County and Pingwu County,Sichuan Province, Jilin Xianghai National Nature Reserve, Chayu County, Tibet Autonomous Region and Macun District,Jiaozuo City, Henan Province, and donated drugs with a total value of RMB 5 million. At present, the chronic disease povertyalleviation project has covered 12 counties and districts in China, including four new poverty-stricken counties and districts andmore than 4,000 registered poverty-stricken households.In the second quarter of 2020, the Group reached agreements with Jiange County Health Bureau and Pingwu County HealthBureau of Sichuan Province to address local needs of the impoverished of curing chronic diseases, and donated drugs worthRMB 1 million. So far, Joincare has successfully launched a series of poverty alleviation projects targeting access to healthcarein Sichuan, cooperating with Chaotian District in Guangyuan City and Songpan County in the Ngawa Tibetan and QiangAutonomous Prefecture, and Jiange County Health Bureau and Pingwu County Health Bureau. This series of projects hasattracted extensive attention.In September 2020, with the support of the Shenzhen Project Care Organizing Committee Office, Joincare and LivzonPharmaceutical Group signed the Medicine Donation Project Cooperation Agreement with the health bureau and people's hospitalof Zayu County in Tibet, with which Shenzhen is paired up in poverty alleviation. According to the agreement, Joincare andLivzon Pharmaceutical Group will donate medicines addressing hypertension, hyperlipidemia and other chronic diseases to ZayuCounty.Thesemedicines,withatotalvalueofRMB1million,willbegrantedinthreeyears,andtherstbatchworthRMB0.4million has arrived in the county. The agreement with Zayu County in Tibet marks another milestone of Joincare and LivzonPharmaceuticalGroupinpracticingthenationalpolicyoftargetedpovertyalleviationandpairing-upassistanceasane?cientaidtoTibetthatembodiesGeneralSecretaryXiJinping'simportantstrategicidea:“Togovernthecountrywellwemustrstgovernthefrontierswell,andtogovernthefrontierswellwemustrstensurestabilityinTibet.”
Launching Ceremony of Joincare & Livzon Pharmaceutical GroupChronic Disease Poverty Alleviation Project in Jiange County
Donation Ceremony of Joincare and Livzon Pharmaceutical Group Chronic Disease Poverty Alleviation Project in Zayu County, Tibet
Joincare signed Chronic Disease Poverty AlleviationAgreement with Pingwu County Health Bureau, Sichuan
2. Caring about Poverty Alleviation by Developing Education
Joincare has long been concerned about the development of education in poor areas and contributed to China's cause of education.With the support of the National Medical Products Administration, the Group pledged to donate a total of RMB 900,000 in threeyears from 2019 to assist poor freshmen enrolled in pharmaceutical-related majors in colleges and universities, who are fromLinquan County, Fuyang, Anhui. Each eligible undergraduate can receive a subsidy of RMB 5,000, and each junior college studentRMB 3,000. During the reporting period, Joincare completed the donation of RMB 300,000 for the second year, which improvedthe learning and living conditions of 70 poor college students and facilitated their studies, so as to cultivate more professionals forthe pharmaceutical industry.
3. Contributing to Epidemic Prevention and Control
SincetheCOVID-19outbreak,Joincarehasbeenattheforefrontoftheghtagainsttheepidemic.InJanuary2020,JoincareandLivzon Pharmaceutical Group made a donation of over RMB 22 million (including RMB 10 million in cash and RMB 12 millionof medical supplies) to facilitate the construction of the Zhongnanshan Medical Foundation, Huoshenshan Hospital, LeishenshanHospital, and other epidemic prevention and treatment bases; in February, Joincare donated medical supplies worth RMB 1 millionto facilitate the anti-pandemic fight of the Third People's Hospital of Shenzhen, the only designated hospital for COVID-19treatment in Shenzhen; and in March 2020, Joincare was recognized by Chibi, Hubei as the "Unit with Outstanding Contributionsto Chibi's Fight Against COVID-19". In addition, during the post-pandemic period, Joincare and Livzon Pharmaceutical Groupprovided novel coronavirus antibody detection reagents worth RMB 600,000 to Macun District, Jiaozuo, Henan, solving theimmediate worries over medical supplies in poor areas. In November 2020, the award ceremony of "Best Listed Companies inGreater China · 2020", organized by Gelonghui, was held in Chengdu, China. After rounds of selection, Joincare stood out frommany competitors and won the "Outstanding Contribution Award for Fighting COVID-19".
Joincare's efforts in chronic diseasepoverty alleviation have been recognizedby society, winning the "ContributionAward of 2020 National PovertyAlleviation Award" at the 2020 ChinaEconomic Summit and the "ExcellentCase Award for Poverty ReoccurrencePrevention" at the 3rd China ExcellentPoverty Alleviation Case Report Meeting.In addition, we filmed the documentaryseries Poverty Alleviation for ChronicDiseases to reveal the real conditions ofthe poor areas as well as the progressof our projects. Among them, the filmSupport for the Old People was awarded"Excellent Micro Video of ShenzhenEnterprise Culture".
The 3rd China Excellent Poverty AlleviationCase Report Meeting "Excellent Case Awardfor Poverty Reoccurrence Prevention"Poverty Alleviation for ChronicDiseases—Support for the Elder People
Joincare is awarded the Unit with OutstandingContributions to Chibi’s Fight Against COVID-19.
Outstanding Contribution Award for Fighting Against
COVID-19
Comprehensive Practice Education Base of Songping No. 2Primary School in Nanshan District—Taitai Pharmaceutical
Students Washing Their Hands Before Practical Operation
4. Pushing Forward Poverty Alleviation by Developing competitive Industries
Joincare and its subsidiary Livzon Pharmaceutical Group have been promoting poverty alleviation by developing competitiveindustries. We set up the concept of "targeted poverty alleviation + Radix astragali industry", and carry out "three combinations"(combining with poverty alleviation policies, industrial development projects, and vocational training). Under the povertyalleviation model of "company + bases + poor households”, we encourage low-income families to plant and process Radixastragali, develop the Radix astragali business into a long-term pillar industry to shake off poverty and achieve well-being, andpromote the construction of the "ecological base of traditional Chinese medicine".
5. Commitment in Community Activities
While pursuing innovation-driven development, Joincare is actively involved in community activities. Adhering to righteousnessand innovation, the Group passes on the cultural essence of traditional Chinese medicine (TCM). On the strength of nearlythree decades of experience in TCM health-care products, Taitai Pharmaceutical, a subsidiary of Joincare, has cooperated withschoolsinthecommunitytoimparttheTCMculture,fromthecultivationofChineseherbstotheiridentication,extractionandpreparation, to the new generation of students. During the reporting period, Taitai Pharmaceutical provided lectures as well aspractical lessons to Songping No. 2 Primary School, involving 225 students in total.
Case: Results of Poverty Alleviation by Developing competitive IndustriesLivzon Pharmaceutical Group has built its own Radix astragali planting base of about 15,000 mu in Hunyuan County,Shanxi, a jointly-developed base of 10,000 mu in Tianzhen County, Shanxi, and a jointly-developed base of 15,000 muin Zizhou County, Shaanxi, and established an Radix astragali industrial park in Tianzhen County. In 2020, the threeplanting bases employed about 110 workers, including 20 in poverty (including base operators and workshop processors),and the qualified Radix astragali produced by poor households would be purchased with priority. The bases conductedtraining for 50 employees in standardized Radix astragali planting and processing techniques. During the reportingperiod, Livzon Pharmaceutical Group acquired 21,239 kg of Radix astragali from Tianzhen and 15,210 kg from Zizhouwith a total amount of approximately RMB 990,000.
Health Empowerment
(I) Protection of Rights and Interests of Employees
1. Compliance of the labor Law
Complying with the Labor Law of the People's Republic of China and the Labor Contract Law of the People's Republic of China,Joincare has formulated and improved the Human Resources Management Regulations, the Training Management System and theAttendance Management System. We sign contracts with employees under the principle of free will, and specify the rights andobligations of employees.According to the Employment Relation Management System of the Group, we fully protect employees' right to know in the hiringprocess, truthfully informing the workers of the content, conditions, sites, hazards, work safety and payment of the jobs, and otherinformation that they request to be informed. In terms of employment, we fully respect and uphold the international human rightsconvention and labor standards to which China is a signatory, strictly abide by the Provisions on the Prohibition of Child Labor,and resolutely resist such behaviors as forced labor and workplace harassment and abuse.
2. Workface Diversity and Inclusiveness
Joincare advocates a diverse and inclusive work environment, encouraging employees of diverse backgrounds, genders, ethnicitiesand nationalities to give full play to their talents in a fair and transparent talent management system. The Group has specified themanagement rules of "anti-discrimination" and "diversity" in the Compilation of Human Resources Management System, prohibitingany form of discrimination in all aspects of human resources management, including hiring, promotion, remuneration and training, andensuringthethoroughimplementationofdiversicationthroughcomplianceauditsofhumanresourcesmanagement.Joincare safeguards the reproductive rights and interests of employees. We encourage female employees who give birth to a childto return to work, provide marriage leave, pregnancy medical check-up leave, maternity leave, breastfeeding leave and otherpaid leaves, and visit female employees who give birth with generous gifts. We care for working mothers with practical actions,including providing baby-care rooms and dedicated refrigerators and offering fitness classes, dance classes, yoga classes andother body-shaping courses for female employees free of charge. During the reporting period, there were 5,777 female employees(46.3% of total employees) in the Group, showinga benign trend of diversified developmentrepresented by the narrowing gender gap.The Group assists foreign employees in theirworking and living in China. We help foreignemployees obtain work permits and residencepermits as required by the Chinese government freeof charge, assign assistants to those weak in Chinese,provide foreign employees with the opportunitiesto learn Chinese, and help them adapt to the workenvironment through team building activities, thuspromoting cultural diversity and inclusiveness in theworkplace.
20182017
5,7775,8694,6874,206
7,0006,0005,0004,0003,0002,0001,000
47.0%
46.0%
45.0%
44.0%
43.0%
42.0%
41.0%
40.0%
2019
Gender distribution of employees of Joincare in 2017-2020
2020
42.5%
44.4%
46.2%
46.3%
Total number of femaleemployees (persons)
Proportion of femaleemployees(%)
3. Openness to Communication
Joincare has established smooth communication channels to value the views and suggestions of employees, listen to theirvoice, and solve difficulties in their work and life. We hold canteen talks and dormitory talks every month, set up dormitoryWeChat groups to listen to employees' reasonable suggestions, keep informed of the actual situation of grassroots employees inaccommodation and other aspects, and put forward targeted measures for improvement and innovation.In August 2020, the headquarter of Joincare set up a labor union committee and a female employees' committee to communicatewith employees closely in a multi-dimensional way, so as to better protect their rights and interests. We have heart-warmingbenefits for employees on holidays and festivals, hold farewell ceremonies for retired employees, and care for the employeeswhose relatives are seriously ill. As of the end of the reporting period, there were nearly 300 union members at the headquarter ofJoincare, with a communication coverage rate of over 90%.(II) Human Resources Management
1. Talent Recruiting and Retention
Joincare has been stepping up efforts in talentemployment. While carrying out experiencedhires and campus recruitment, we seek diversifiedrecruitment channels such as online recruitment,internal recommendation and government cooperation,and standardize the recruitment process to build upstrong teams. We have minimum requirements for theeducation background and competence of employeesin specific positions, so as to improve the quality andperformance of personnel and build more dynamicteams. In the reporting period, Joincare recruited 1,896employees of various background.Joincare continuously optimizes its human resources management model and strives to build professional, efficient andinnovative teams which is considered the one of the core competitiveness of the Group. As of the end of the reporting period,Joincarehad12,466employees,seeingcontinuousbenigngrowthinthesta?membersandsignicantimprovementinemployeeretentionratewithasta?turnoverrateof17%,layingasolidfoundationforthesoundandstabledevelopmentoftheGroup.
2. Compensation System
According to our internal policies such as theSalary Management System and the PerformanceManagement System, Joincare provides employeeswith competitive salaries and benefits, make sureour employees have their Statutory holidays andcontributes to employees' pension insurance, medicalinsurance, unemployment insurance, work-relatedinjury insurance and maternity insurance; Moreoverwe also offer them with housing provident fund andsupplementary medical insurance.Upholding the management philosophy of " ensuring the consistency between responsibility and benefit, the consistencybetween ability and value, and the consistency between performance and earnings", we have established a variable compensationmechanism that divide salary into fixed and variable parts, and the latter is subject to both the Group's performance and theemployees' personal performance. We believe this mechanism could make employees highly motivated. In 2020, the Groupestablished a scientific and effective performance evaluation system and implemented the parallel management system of OKR(Objectives and Key Results) and KPI (Key Performance Indicator). In this parallel system, we set up a performance evaluationteam, focusing on employees' value to the Group as the core criteria of evaluation. Following the principles of strategic guidance,value leading, development promotion and objectivity and fairness, the evaluation is conducted at departmental and individuallevels. The departmental evaluation mainly involves key performance, innovation and optimization, team building, andcommunication and cooperation, while the individual evaluation considers personal performance, improvement and optimization,and other aspects.
20182017
12,46612,69910,5529,906
14,00012,00010,0008,0006,0004,0002,000
30%25%20%15%10%5%0%2019
Total number and retention rate of employees of Joincare in 2017-2020
2020
21%
24%
18%
17%
Total number of femaleemployees (persons)
Employee turnoverrate (%)
By establishing the Social Responsibility Committee of the Board of Directors, social responsibility management indicators,including environment, safety and occupational health, have also been incorporated into the performance evaluation system ofemployees in their job positions. Our Human Resources Management Department take the management indicators that highlyrelevant to the Group's sustainable development in the establishment of the performance evaluation system.
3. Equity Incentive Compensation
Based on the long-term development and governance for the future, Joincare has innovated long-term incentive mechanismsof shareholding for senior management and the core technical team to achieve shared responsibility and value. The Group hasimplemented long-term incentive mechanisms such as the Management Measures for Assessing the Implementation of StockOption Incentive Plan 2018 and the Medium- and Long-term Business Partner Shareholding Plan (Draft). In 2020, Joincare and itssubsidiary Livzon Pharmaceutical Group further implemented the Medium- and Long-term Business Partner Shareholding Plan.The proposed holders include core managers serving in the Group (including its subsidiaries), who play an important role in theGroup's overall performance and medium and long-term development.
2017104,012132,693
236,677362,094
404,970
555,090551,939
664,782
1,400,0001,200,0001,000,000800,000600,000400,000200,000
2018
Training hours for employee of Joincare in 2017-2020
20202019Total training hours of maleemployees (hours)
Training hours of per maleemployee (hours)Total training hours of femaleemployees (hours)
Training hours of femaleemployee (hours)
2017201820192020
24.7
23.3
61.7
50.5
69.0
96.1
99.4
80.8
120.0
100.0
80.0
60.0
40.0
20.0
0.0
Training hours per employee of Joincare in 2017-2020
Case: Equity Incentive of JoincareThe vesting period of the initial options granted under Joincare's Management Measures for Assessing the ImplementationofStockOptionIncentivePlan2018expiredinDecember2020,andthesecondvestingperiodhascommenced.Therstvesting period of the reserved options commenced in September 2020. According to the Stock Option Incentive Plan,44,950,000 stock options are granted, accounting for 2.32% of Joincare's total share capital. It effectively integrates theinterests of shareholders, the Group and employees, and makes all stakeholders focus on the long-term development ofJoincare.
4. Training and Development
Joincare actively expands training resources and provides supporting professional training courses for employees in differentpositions. We highly encourage the R&D team to gain competence in project management, testing and information retrieval, thepersonnel on production lines to receive knowledge training on production Safety, machine operation, and environmental protectionand optimization, the sales team to attend practical knowledge about the products and marketing skills. Training for the functionalpersonnel at the headquarter focuses on improving their general knowledge and professional skills.We cultivate internal instructors and develop special courses independently, developing a well-functioning training system.Meanwhile, we make full use of the online learning platform to expand the scope of training. We record the training courses sothat employees can learn and improve themselves anytime and anywhere. We encourage employees to obtain various professionalqualifications, and provide subsidiaries and incentives for specific qualifications (such as Certified Safety Engineer). The QualityManagement Department, Safety Management Department and other departments take advantage of their own resources andengage external experts through the Human Resources Department to provide training and mentoring resources for employees toobtainprofessionalqualications.
In terms of training feedback and efficiency assurance, we adopt the "531" learning principle. We share 5 self-achievements, 3work applications, and 1 action plan in each training session, and assign supervisors to ensure the results. During the reportingperiod, we provided 1,219,872 hours of training to employees, with 97.9 hours of training per employee.
5. Training and Promotion Plans
Joincare respects employees' personal career planning, conceives vertical and horizontal development channels for them, andallows them greater possibility for promotion and development. The Group adopts the combined approach of "progressivepromotion" and "exceptional promotion", where employees are promoted hierarchically and those with outstanding performanceor special expertise can enjoy leapfrog promotion. The Group recognizes the diversity of talent backgrounds, and promotesemployeesofdi?erentculturalbackgroundsandnationalitiesindi?erenteldsanddimensions.TheGroupregularlyanalyzesitshumanresourcesandrelatedpositions,classiesprofessionsaccordingtostrategicobjectives,supports the path and process of human resources development, and provides opportunities, resources and support for employees'development. During the reporting period, 138 staff members in professional positions and 89 in management positions gotpromoted, and the turnover rate decreased by 9% from last year.
Case : Quality Month—Experimental SkillsCompetitionCase : Joincare launched the "Dream & Future"training program for management traineesIn 2020, Joincare launched the "Dream & Future"training camp for new employees of recruited fromgraduates. The six-day training program covered thecamp orientation, corporate culture, workplace skillsand outward bound. The intensive training helpednew employees integrate into the corporate culture,gain an overall insight into the business, enhance theirjob competence, and improve their professionalism,facilitating their shift from campus to the workplace.
In addition to supporting training resources, the Groupalso provides employees with opportunities to learn fromeach other, aiming to further strengthen the constructionof a professional and skilled talent team and create afavorable atmosphere for employees. In September2020, Shanghai Frontier, a subsidiary of Joincare, heldthe Quality Month Experimental Skills Competition,which was of great significance for experimenttechnicians to foster pioneering and innovative spiritsand establish a rigorous, pragmatic and meticulousattitude toward work, thus forming a sound workingatmosphere where colleagues compete with, learn from,catch up with and in turn surpass each other.
Case: Joincare's Excellent Employee Selection ActivityIn 2020, we conducted semi-annual and annual merit evaluation, presentingseven awards to 129 employees, rewarding excellent individuals and teamswith money and honorary titles. Through merit evaluation, we discovertalented personnel, set up advanced models, stimulate employees' intrinsicmotivation, enhance collectivism, and create a cultural atmosphere ofinnovation, truth-seeking, cooperation, and sharing.
6. Encourage Work-Life Balance
Joincare is dedicated to building a corporate atmosphere of balance between work and life by regularly organizing team building,sports, fitness and holiday-themed activities to improve employees' sense of happiness, providing them with a vibrant workingatmosphere while enriching their spiritual life.
In 2020, we offered over 200 courses on yoga, dancing and Tai Chi. We also set up a gym and engaged professional coachesto teach employees how to use the fitness equipment properly. We invited professionals to give trainings and lectures in groupcompanies. The seven sessions enriched employees' life and won wide praise.
"You Lighten the Dream of Health" Activity on International
Women's Day
"Elegant Life & Ancient Tea Art" Tea Culture Courses
Birthday Party for Employees Fitness Course for Employees
Green Development
(I) Green Management
1. Management Targets
Joincare follow relevant laws and regulations regarding to environmental protection, including the Environmental ProtectionLaw of the People's Republic of China, the Law of the People's Republic of China on Prevention and Control of EnvironmentalPollution by Solid Waste, the Atmospheric Pollution Prevention and Control Law of the People's Republic of China, theWater Pollution Prevention and Control Law of the People's Republic of China, the Law of the People's Republic of China onPromoting Clean Production. In accordance with the ISO14001 standard, We have developed and implemented a series of ourownmanagementmeasures,includingGeneralRequirementsforEHSManagementSystem,RequirementsforIdenticationandAssessment of Environmental Factors, and EHS Internal Audit Management Procedures.Joincare has set the annual environmental objectives in line with the concept of green, healthy and sustainable development. Westrengthen the monitoring of energy consumption, pollutant emission and other environmental information during productionand operation, continuously improve environmental management performance according to the monitoring results, and keepupgrading the environmental management ability. In 2020, Joincare reported no major environmental pollution accidents orenvironmental administrative penalties in any of production subsidiaries. The initial rainwater collecting rate, the acceptancerates of production wastewater and domestic sewage treatment, waste gas treatment and noise detection, and the solid wastedecontamination rate all reached 100%.The Group has set annual targets for saving energy and reducing emission and waste with 2020 as the base year, and allproduction companies will formulate and implement corresponding action plans in 2025. During the reporting period, the Groupreported no environmental accidents or penalties.
Table: Joincare's Environmental Objectives and Their
Completion in 2020
Environmental Objective
AnnualTarget
Completion
Status
Rate of waste water and gas upto the discharge standards
100%√Major environmental pollutionaccidents
√Environmental penalties 0√
Table: Joincare's Middle to Long-term Objectives for Energy
Saving and Emission Reduction
Indicator
Unit (productionvalue=￥10,000)
Targets of Emission Reduction
( From the period of 2021-2025, the
benchmark year is 2020 )
Water
water comsumption perunit production
At least 5% lowerElectricity
Electricity consumption
per unit production
At least 5% lowerChemicaloxygendemand
Emission per unitproduction
At least 5% lowerSulfurdioxide
Emission per unitproduction
At least 10% lowerHazardouswastes
disposal volume perunit production
At least 2% lower
2. Management Structure
Joincare has established a sound EHS management structure, breaking down the EHS responsibilities and implementingthem thoroughly according to the Quality, Environment and Occupational Health and Safety Management Manual, forminga management organization responsible for prevention and timely disposal of accidents, responsibility investigation, andimplementation of management measures. Based on the actual situation, subsidiaries engaging in production are equipped withfull-time or part-time EHS managers to conduct on-site EHS management. Meantime, EHS training at all levels is often organizedamong subsidiaries engaging in production to ensure the normal functioning and continuous improvement of the EHS managementsystem. The Group conducts overall supervision on the safety and environmental protection of its subsidiaries. In order to verify theEHS management of its production subsidiaries and prevent accidents, the Group also conducts EHS audits on these subsidiaries onan annual basis.
EHS Management CommitteeThe Group' EHS DepartmentFunctional Departmentsof the Group
SubordinateManufacturers
In a subsidiary engaging in production, the principalperson in charge of EHS is the general manager, who takesoverall responsibility for the EHS work in the company;the direct person-in-charge is the EHS head or departmentmanager, who is responsible for the specific managementand implementation of the EHS work in the company. Allsubsidiaries should respond actively and report to the EHSDepartmentoftheGroupforauditsandling.
3. Management System
All of Joincare’s15 production subsidiaries have obtained the ISO14001 Environmental Management System (i.e. EMS)certication,andaresubjecttothesurveillanceandauditingannuallyandrenewalaudittrienniallyaccordingtotherequirementsofthe EMS system. The subsidiaries engaging in production have achieved 100% coverage of environmental impact assessment andthe "three simultaneous" system (the facilities for pollution prevention and control should be designed, constructed and put into usesimultaneously with the main work of the project). In addition, the subsidiaries engaged in production have developed all-aroundself-monitoring programs and engaged qualified independent third-party testing organizations to conduct quarterly and annualtesting for wastewater and exhaust gas outlets, so as to fully guarantee the compliance of discharge and emission of all productioncompanies.
Table:Joincare'sEMSCerticationCompany Name EMS CerticationTaitai PharmaceuticalISO14001Cleaner ProductionJiaozuo JoincareISO14001GB/T24001-2016Shenzhen HaibinISO14001Cleaner ProductionXinxiang HaibinISO14001GB/T24001-2016Sichuan GuangdaISO14001 Cleaner ProductionShanghai LivzonISO14001 Cleaner ProductionLivzon PharmaceuticalFactory
ISO14001Cleaner ProductionLimin PharmaceuticalFactory
ISO14001Cleaner Production
Company Name EMS CerticationLivzon BioISO14001Cleaner ProductionNew North RiverPharmaceutical
ISO14001Cleaner ProductionGutian FuxingISO14001Cleaner ProductionJiaozuo Livzon SyntpharmISO14001Cleaner ProductionNingxia PharmaceuticalISO14001Cleaner ProductionLivzon Syntpharm (ZhuhaiFTZ)
ISO14001Cleaner ProductionFuzhou FuxingISO14001Cleaner Production
Joincare's EHS Management Structure
Joincare
SOCIAL RESPONSIBILITY REPORT 2020
4. Regular EHS Audit
Joincare's subsidiaries have developed internal audit procedures for the EHS management system according to Joincare Group'sManagement Procedures for Internal EHS Audits. The EHS Department of the Group has organized audit teams and formulatedinternal audit plans to conduct EHS audits on all subsidiaries twice a year. A comprehensive internal audit report is required aftereach auditing, and a EHS audit report of the Group is submitted to the management every six months for review and approval.Once a defect is found in the audit, remedies must be carried out and tracked as per the uniform form in the ManagementRegulations for Corrective and Preventive Measures.Throughout the reporting period, we completed 38 times of EHS audit and on-site supervisions for our subsidiarty companies;and the relevant EHS potential issues have been recognized and corrected.(II) Green ProductionJoincare Group encourages its subsidiaries engaging in production to continuously increase investment in O&M of environmentalprotection and equipment renovation to further improve the environmental protection facilities in production areas. Theproduction subsidiaries have continuously upgraded their environmental protection equipment and optimized their productionprocessestoachievegreendevelopment.Duringthereportingperiod,ShenzhenHaibinwascertiedasanationalgreenfactoryand Xinxiang Haibin was rated as a Class-B pharmaceutical enterprise for heavy pollution weather in 2020-2021.
Table: Joincare's Investment in Environmental Protection in 2018-2020Indicator Unit201820192020Investment in O&M of environmental protectionRMB 10,00012,347.5313,301.4513,290.80Investment in renovation of environmentalprotection equipment
RMB 10,0007,083.446,663.354880.49
1. Energy E?ciency Improvement
Complying with the Energy Conservation Law of the People's Republic of China and the Law of the People's Republic of Chinaon Promoting Clean Production, Joincare has implemented a complete set of internal environmental management standards andestablished an energy efficiency management system that covers the optimization of management activities and focuses on theprocessandrigorousimplementation.In2020,Joincarecontinuedtoimproveitsenergye?ciency.Itconductedacomprehensivesurvey against the Catalogue of Obsolete Mechanical and Electrical Equipments Eliminated due to High Energy Consumptionand replaced obsolete devices with energy-saving ones, thus gradually reducing the energy loss of factories, and buildingproduction-oriented enterprises with low energy consumption.Joincare formulates annual energy conservation plans and regularly reviews the progress. The subsidiary, Livzon PharmaceuticalGroup, set the energy management target for 2020 as bringing down the total electricity consumption from 2019 and reducingthe electricity consumption per revenue of RMB 10,000 by 5% from 2019. It conducted energy audits for subsidiaries withhigh electricity consumption, measuring and assessing their electricity consumption, thus basically meeting the target. XinxiangHaibin planned to introduce supergravity facilities and replace high vacuum pumps with screw vacuum ones during the reportingperiod. So far, the supergravity facilities have been put into use, and one-third of the high vacuum pumps have been replaced.Thecompanyalsoplannedtoreplacetheoldcoolingtowerwithanewhigh-e?ciencyone,whichhasbeenbuiltupandputintouse. The air suspension blower of the Cyclic Activated Sludge Technology (CASS) tank of Jiaozuo Joincare has been put into usesince October 2020, and the annual target has been achieved.
Table: Key Energy Conservation Projects of Joincare in 2020Company NameProjectInvestment Energy ConservationJiaozuo Joincare
Upgrading and replacing the aeration blower in the industrial wastewatertreatment workshop and replacing the multi-stage centrifugal blower with ane?cientandenergy-savingairsuspensionblower.
RMB1 million
Saving 30% of electricityconsumptionXinxiang Haibin
Replacing the high vacuum pump with a screw vacuum pump and introducinga three-in-one centrifuge.
RMB
0.7million
A single unit saves 7.5 kWh ofelectricity per hour and reducessolvent volatilizationShenzhen Haibin
Replacing the original cooling tower with a new one that adopts the frequencyconverting control system.
RMB
0.36 million
The energy consumption isreduced by 20%, saving 18,000kWh of electricity per yearFuzhou Fuxing
Replacing four 110kW Roots blowers with two 84kW air suspension blowersand two 90kW screw blowers.
RMB
1.18 million
Saving 30% of electricity, i.e.50,000 kWh per monthLivzonPharmaceuticalFactory
Building the solar photovoltaic power generation project for power supply ofproduction equipment and lighting ofLivzon Pharmaceutical Factory.
RMB14 million
Providing 230,000 kWh ofphotovoltaic power generationfor the factory this yearLivzonSyntpharm(Zhuhai FTZ)
Finely managing central air conditioners through the central air conditionercloudmonitoringsystemandevaluatingtheenergy-savinge?ectinrealtime.
RMB
0.2 million
Saving 5% of electricityconsumption
Table: Energy Use of Joincare in 2020IndicatorUnit
Active PharmaceuticalIngredients
PreparationsTotalGasoline Liter148,410.6230,468.6378,879.1Diesel Liter27,0941.611,0921.038,1862.6Coal Ton4,336.504,336.5Natural Gas 10,000 cubic meters 659.9 490.81,150.7Purchased Steam Ton1,023,160.372,129.61,095,289.9Purchased Industrial Electricity 10,000 kWh 70,499.110,099.980,599.0
Joincare focuses on the impact of business operations on climate change. Its greenhouse gas emissions mainly come from fuelcombustion in the production process, the electricity consumption consumed by power equipment and lighting, and steam used byheating equipment.
Table: Greenhouse Gas Emissions of Joincare in 2020
IndicatorUnitAPI BusinessPreparation BusinessTotalCategory I Greenhouse Gas Emissions Ton of CO
equivalents 24,295.911,462.635,758.6Category II Greenhouse Gas EmissionsTon of CO
equivalents938,384.3106,072.41,044,456.8Total Greenhouse Gas EmissionsTon of CO
equivalents962,680.3117,535.01,080,215.3
2. Saving Resources
Joincare continuously improves resource management, advances clean production, adopts advanced technology and strictlymanages the consumption of water resources. We actively promote water-saving processes such as the reuse of reclaimed waterand condensate water and production cleaning process in the industrial production process, and popularize the application ofinduction faucets to minimize the use of fresh water; We also strengthen the maintenance of equipment and facilities to preventleakage and venting.
Table: Key Water-saving Projects of Joincare in 2020Company NameProject NameInvestmentWater-savedXinxiang Haibin
A large amount of concentrated water that is generated in the process ofproducing and preparing pure water was directly discharged to the sewagestation before but now is discharged to the recycling pool for reuse byrenovating and adding pipelines.
RMB
0.2 million
Saved 60 tons of water per dayXinxiang Haibin
Replacingthebeltlterpressforsludgedewateringfeaturingalargewaterconsumption with a stacked screw type sludge dehydrator.
RMB
0.4 million
Saved 180 tons of water per dayXinxiang HaibinReplacing the manual toilet faucets with induction faucets. RMB 3,000
Saved 50% of water consumption
than beforeShenzhen Haibin
Thenewly-builtsewagestationadoptstheairotation+coagulation-occulationandsedimentation+hydrolyticacidication+anoxic/aerobic+ MBR + UF + secondary RO + evaporation and concentration technologyto realize the full recycling of production wastewater.
RMB
8.29 million
Saved 12,000 tons of water per
yearShenzhen Haibin
Thetailwaterinthewatercollectionandproductionstationislteredthroughtwo-stagehigh-e?ciencylterdevices(10μmand1μm)andthenis used as recycled water for water supply.
Saved 18,000 tons of water per
yearFuzhou Fuxing
Theheavywatercausedduringthewaterproductioninthereningworkshop was directly discharged into the sewage treatment systembefore,whilenow,alltheheavywaterisrecycledforreuseasreghtingwater,watersprayforremovalofwastegas,toiletushingwaterandowerirrigationwater.
RMB
0.2 million
Saved 100 tons of water per day
Livzon GroupNingxiaPharmaceuticalCo., Ltd.
Building one 1,500m3/h cooling tower and two 500m3/h high-temperaturewater cooling towers to solve the water discharge problem, reduce theconsumption of fresh water, and reduce the consumption of chilled waterand the running time of the refrigerator.
RMB
2.52 million
After the renovation, the annual
water consumption is saved by
400,000 m3, and the ice water
steam cost is saved by RMB 1.1
million, reducing the electricity
cost for circulating water by
RMB 480,000New North RiverPharmaceutical
Adjusting the PH of acidic and alkaline water used for resin washing, andusing it as circulating cleaning water after treatment.
RMB
0.1million
Saved 9,000 tons of water per
month
Table: Water Resources Use of Joincare in 2020
IndicatorUnitAPIsFPPsTotalTotal Water Consumption10,000 tons 1,012.5152.6 1,165.1Joincare attaches great importance to the recycling of resources and promotes the recycling of industrial materials throughtechnical transformation to continuously improve the utilization rate of production resources. It continuously optimizes theproduct packaging design, reduces the use of packaging materials while meeting the market and production needs, and activelycarries out the recycling of green and environmental packaging boxes to reduce the consumption of resources.
Table: Key Material Saving Projects of Joincare in 2020
Company NameProjectInvestmentInpact
Xinxiang Haibin
The vacuum system in the production workshop produced high-concentration waste gas such as dichloromethane and tetrahydrofuran.Now, Xinxiang Haibin adds the rectifying tower, ultra-gravity deviceand solvent membrane recovery system and adopts a combinationof technologies including jet screw compression, condensation andmembrane separation to control tail gas so as to realize the recycling ofsolvent while reducing pollutant emission.
RMB
6.7 million
Recycled 80% of solvent annually
Jiaozuo Joincare
Improving products' outer packaging materials and replacing thepaper barrel outer packaging materials featuring large space andinconvenient transportation with cartons.
/Reduced the packaging cost by52% per kg of productLivzon PharmaceuticalFactory
Adding the 56-piece packaging specification for Bismuth PotassiumCitrate Tablets/Tinidazole Tablets/Clarithromycin Tablets, CombinedPackage.
RMB 20,000
Saved RMB 363,000 of packagingmaterial procurement cost per yearLivzon PharmaceuticalFactory
CancelingtheockinginnersupportingpackagefortheMouseNerveGrowth Factor For Injection.
RMB 10,000
Saving RMB 130,000 of packagingmaterial procurement cost per yearLivzon PharmaceuticalFactory
Optimizing the packaging of Rabeprazole Sodium Enteric Tablets.RMB 30,000
Saving RMB 777,000 ofprocurement cost per year
Xinxiang Haibin Solvent Film Recovery DeviceXinxiang Haibin Rectifying Tower Solvent Recovery Device
3. Pollutant Reduction
In the process of production and operation, Joincare attaches great importance to the control of pollutant emission, strictlyimplements various laws, regulations, standards and local norms in environmental protection, actively promotes new emissionreduction technologies, improves drying processes and upgrades dust removal equipment to ensure that the emission of all kinds ofpollutants meets the required standard so as to reduce the emission of pollutants from the source.Joincare formulates emission reduction plans and regularly reviews the progress. Livzon Pharmaceutical Group Inc., a holdingsubsidiary of the Group, has set the emission target of sulfur dioxide in 2020 to be lower than that in 2019, and the emission forachieving the operating revenue of RMB 10,000 to be 5% lower than that in 2019. Livzon has successfully reconstructed the wastegas treatment facilities, promoted the replacement of gas boilers, and properly maintained and operated the existing boilers anddesulfurization devices. The goal of Jiaozuo Joincare is to increase production but not increase pollution. In 2020, Jiaozuo Joincarelaunched the Enzymatic Method Quality 4-AA Project. It implemented the project of "Comprehensive Recovery and TechnologyUpgrading of Waste Liquid" while keeping the output growth. It has completed its goal. Xinxiang Haibin plans to transform the high-concentration waste gas treatment facility process and launch the dichloromethane and tetrahydrofuran membrane recovery system toimprove solvent recovery and reduce pollutant emission. At present, the construction has been completed and the equipment is undercommissioning. Shenzhen Haibin plans to change ordinary boilers to low nitrogen boilers. The goal has been completed.
● Emission Management
All production subsidiaries of Joincare shall strictly abide by the Atmospheric Pollution Prevention and Control Law of the People'sRepublic of China and the Integrated Emission Standard of Air Pollutants to formulate the VOCs (Volatile Organic Compounds)Collection and Treatment Management System and the waste gas management system such as boiler waste gas emissionmanagementtoensurethee?ectiveoperationofthewastegascollectionandtreatmentsystemandtreatmentfacilities.Theyshouldalso regularly carry out third-party gas monitoring to reduce the impact of waste gas emission on the surrounding environment.
Table: Key Waste Gas Management Projects of Joincare in 2020Company NameProject NameInvestmentKey Results
TaitaiPharmaceutical
Collecting and handling the emission of waste gas caused by the three-in-one aerosol injection molding equipment in the oral liquid injection moldingand automatic packaging line.
RMB80,000
The emission is up to standardafter detectionXinxiang Haibin
Conducting the process transformation of the high-concentration wastegas activated carbon adsorption device, adding the tail gas drying self-circulationprocess,replacingtheactivatedcarbonberandactivatedcarbonparticles and building the high-concentration waste gas water spray tower.
RMB
0.4 million
Improvedthetreatmente?ectof high-concentration wastegasXinxiang Haibin
Carryingoutwastegasleakagedetectionandrepairprojects,andndingand repairing 15 leakage points.
RMB70,000
E?ectivelyreducedwastegasleakageShenzhen Haibin
Installing a set of online VOC monitoring system at the waste gas outlet todetect the concentration of discharged VOCs in real time.
RMB
0.36 million
Provides strong data supportfor the operation of theprocessing systemLivzonSyntpharm(Zhuhai FTZ)
Controlling the emission of VOCs, increasing condensation pre-processing,and replacing the wastewater pool cover plate.
RMB
2.57 million
Improvesthee?ciencyofcollecting and processingVOCsNingxiaPharmaceutical
Upgrading and reconstructing the waste gas treatment facilities in 103-1 and 102 fermentation workshops, and replacing two sets of "sodiumhypochlorite spray absorption + water spray absorption + biphasic superoxygen water + micro-nano bubble" treatment facilities
RMB
5.6 million
Further improve the treatmente?ectoffermentationwastegas,andsignicantlyreducingthe odor around the workshopNingxiaPharmaceutical
Upgrading and reconstructing the waste gas treatment facilities of the 101fermentation workshop, and adding two waste gas treatment spray towers toexpand the waste gas treatment capacity
RMB400,000
Table: Air Pollutant Emissions of Joincare in 2020
IndicatorUnit
Active PharmaceuticalIngredients
PreparationsTotal
Nitrogen oxideTon74.313.4 87.6Sulfur dioxideTon47.1 0.7 47.8Particulate Matters (PM)Ton15.60.8 16.4
● Wastewater Management
In accordance with the requirements of the Water Pollution Prevention and Control Law of the People's Republic of China,the Integrated Wastewater Discharge Standard and the Discharge Standard of Water Pollutants in the PharmaceuticalIndustry, Joincare defines the management measures for internal water pollution prevention and control in the EnvironmentalProtection Management System. All production subsidiaries shall reasonably arrange the production and gradually adjust andtechnologically transform the process and equipment generating wastewater to reduce the discharge of wastewater. At thesame time, they shall strictly implement the Management Regulations for Sewage Discharge to ensure the stable operation andcontinuous up-to-standard discharge of wastewater treatment facilities through daily management. The wastewater treatmentprocess of production subsidiaries is mainly the biochemical treatment + physical treatment, and the qualified wastewater isdischarged into the municipal sewage pipe network.
Table: Key Wastewater Management Projects of Joincare in 2020Company NameProjectInvestmentKey Results
Jiaozuo Joincare
Inordertoimprovethetreatmente?ciencyofhigh-concentrationwastewater, the anaerobic 1 # and 2 # reactors in the industrial wastewatertreatment workshop are upgraded to anaerobic reaction tanks.
Over RMB
4 million
under late stage of installationXinxiang Haibin
In order to improve the high-concentration wastewater treatment capacitygeneratedbytheworkshopprocess,asetofhigh-e?ciencyandenergy-saving mechanical vapor recompression (MVR) device is added.
RMB4 million
expanded the wastewatertreatment capacity to100m3/dayShenzhen Haibin
Inordertoimprovethewastewatertreatmente?ciency,themicroporousaeration tubes used for providing dissolved oxygen in the CASS tank arereplaced with independent aeration valves.
RMB130,000
Increased the wastewatertreatmente?ciencyby20%Fuzhou FuxingReplacing old rainwater and sewage pipe networks
RMB
1.4 million
Realized rain and sewagediversion and reducedenvironmental protection risksLivzon Syntpharm(Zhuhai FTZ)
Conducting technical transformation of the wastewater ozone deeptreatment system to solve the bottleneck of ozone odor and treatmentcapacity
RMB10,000Obviously reduced thechromaticity of wastewater andthe COD dischargeTable: Wastewater Discharge and Pollutant Emissions of Joincare in 2020IndicatorUnit
Active PharmaceuticalIngredients
PreparationsTotal
Wastewater Discharge Ton8,136,750.4 709,168.6 8,845,919Chemical oxygen demandTon763.7 33.3 797.0Ammonia nitrogenTon71.2 0.9 72.1
● Solid Waste Management
Joincare abides by the principle of "reduction, recycling and harmless disposal of waste" in the Law of the People's Republic ofChina on Prevention and Control of Environmental Pollution by Solid Waste, and strictly implements the Standard for PollutionControl on the Non-hazardous Industrial Solid Waste Storage and Landfill and the Standard for Pollution Control on HazardousWaste Storage to dispose of solid wastes in a standardized manner.For general industrial wastes such as waste packaging materials, we will actively recycle them according to the economicand technical conditions, and take measures to store the unusable parts in a centralized manner according to the ManagementRegulations for Solid Waste Storage Yards to regularly hand them over to a professional third party for disposal; for hazardouswastes,wewillcollectandstorehazardouswastesinaclassiedmannerinaspecialwarehouseforhazardouswastesaccordingtothe hazardous waste management regulations, and assign special personnel to manage them. All hazardous wastes will be entrustedtoaqualieddisposalorganizationfortransferanddisposal.
Table: Waste Disposal of Joincare in 2020IndicatorUnit
Active PharmaceuticalIngredients
Preparations Total
Non-hazardous Industrial Wastes Ton60,588.4 15,303.5 75,891.9Hazardous WastesTon3,826.7 444.2 4,273.7
Pharmaceutical Wastes andMedicine Wastes
Ton2,116.0135.4 2,251.4Other Hazardous Wastes Ton1,713.5308.8 2,022.3
The scope of environmental data disclosure is the energy used by the production enterprises under Joincare
Appendix - Key Performance TableCSR Indicator Unit2018 20192020
1. Environmental Protection
1.1 Emissions
Types of Emissions and Relevant DataWastewater DischargeTon9,905,353.5 9,923,594.1 8,845,919.0Chemical Oxygen Demand CODCr Ton1,023.5896.1797.0Ammonia nitrogenTon88.592.972.1NO
X
Ton136.9143.987.6SO
Ton91.376.847.8Particulate Matters (PM)Ton37.8 29.2 16.4Non-hazardous Industrial Waste
Ton175,529.6 124,217.2 75,891.9Hazardous Waste
Ton2,896.3 3,428.9 4,273.7Pharmaceutical Wastes and MedicineWastes
Ton1,965.9 2,242.5 2,251.4Other Hazardous Wastes Ton930.4 1,186.4 2,022.3Total Greenhouse Gas EmissionsTotal Greenhouse Gas EmissionsTon of CO2 equivalents1,155,964.51,177,203.31,080,215.3Category I Greenhouse Gas EmissionsTon of CO2 equivalents166,818.0186,668.235,758.6Category II Greenhouse Gas EmissionsTon of CO2 equivalents989,146.5990,535.1 1,044,456.8
1.2 Resource Utilization
Total Energy ConsumptionGasolineLiter415,613.7492,135.4378,879.1DieselLiter585,156.8407,035.3381,862.6CoalTon63,140.072,714.24,336.5Natural Gas10,000 cubic meters1,140.71,217.11,150.7Purchased SteamTon708,477.1772,026.21,095,289.9Purchased Electricity 10,000 kWh 87,094.585,085.080,599.0Water ConsumptionTotal Water Consumption10,000 Ton1,292.71,282.01,165.1
2. Social Responsibility
2.1 Employment
Number of Employees: By Gender, Typeof Employment, Age Group and RegionNumber of Employees Person10,55212,69912,466Male Person5,8656,8306,689Female Person4,6875,8695,77729 Years Old and Below Person4,3574,8644,49430-49 Years OldPerson5,6277,1947,300
CSR Indicator Unit2018 2019202050 Years Old and AbovePerson568641672Mainland China Person10,53212,68712,448Hong Kong, Macao and Taiwan, China Person446Foreign Countries Person16812Employee Turnover RateOverall Employee Turnover Rate
Percentage 241817
2.2 Health and Safety
Number of Deaths due to WorkPerson000Frequency of Work-related InjuriesCase 14124Days Lost due to Work-related InjuriesDay652593197
2.3 Training and Development
Trained EmployeesSta?TrainingHoursHour598,751956,9081,219,872TrainingHoursforMaleSta?Person362,094551,939664,782TrainingHoursforFemaleSta?Person236,677404,970555,090Training Hours per EmployeeAverageSta?TrainingHoursHour56.875.497.9AverageTrainingHoursforMaleSta?Hour61.780.899.4AverageTrainingHoursforFemaleSta?Hour50.569.096.1CharityResource Utilization for Special PurposeFinancial DonationRMB million735.5833.41,505.47Value of Donated Goods RMB million57.1221.9710.821 The scope of environmental data disclosure is the energy used by the production enterprises under Joincare2 Some general industrial wastes are sent to boilers for incineration treatment according to the requirements of the environmentalimpact assessment report; thus, they are not included in the general industrial waste statistics. The statistical scope and data ofgeneral industrial wastes in 2018 and 2019 are adjusted retrospectively.3 Some medical wastes and waste drugs are sent to boilers for incineration treatment in accordance with the requirements of theenvironmental impact assessment report. They are not included in the statistics of medical waste; thusThe statistical scope and dataof medical waste in 2018 and 2019 are adjusted retrospectively.4 The calculation method of employee turnover rate: number of resigned employees / (total number of employees at the end of the
periods)