S.C.P.C — Annual Report 2021

Apr 6, 2022

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Standard Chem & Pharm Co., Ltd. Stock Symbol : 1720

2022 Investor Conference 04/07/2022

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免責聲明Safe Harbor Notice

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本次簡報與討論包含特定預測性的說明，而其內容有關於營運結果、財務狀況，以及對未來事 件的預期。因為此等前瞻性說明是有關於未來事件，而且取決於未來發生時的環境因素，所以必 然含有風險與不確定性。

本公司將不負擔公開更新或修改這些預測性的說明之義務，無論是出現新資訊、未來發生任何 事件，或其他情況。實際結果可能與此等預測性說明推測的內容有重大差異。

In these presentations and discussions, there are certain forward looking statements regarding the results of operation, financial condition and current expectation about future events. As forward-looking statements relate to events and depend on circumstances in the future, they involve risk and uncertainty.

We do not undertake any obligation to publicly revise or update any forward looking statements for availability of new information, future events or otherwise. Real result probably differ substantially from those expected in these forward-looking statements.

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© 2022 SCP, Ltd

Agenda

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 Introduction of Standard Group

 2021 Operating Results

 Future Operation Strategy  Corporate Social Responsibility (CSR)

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Agenda

 Introduction of Standard Group

 2021 Operating Results

 Future Operation Strategy  Corporate Social Responsibility (CSR)

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SCP and Related/Affiliated Companies
Upstream Manufacture Downstream
Syn-Tech (1982; 2005 SCP(1967;
Taiwan Biosim(2017)
Over-The-Counter (OTC)) 1995 listed stock)
Western
medicine
Your Chance
Syngen(1999; 2016 OTC) Souriree(1997)
(2013 Re-investment)
Multipower
Syngen(1999)
(2012 Re-investment)
Healthcare
nutrition
Sun-you(1994) Advpharma (1999)
Medical-
Syngen (1999)
devices
Q
Ho Yao Biopharm
Gene chip Advpharma (1999) (2022)
Inforight(2000)
Software/Hardware 4
service support
2022 SCP, Ltd
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© 2022 SCP, Ltd
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International Accreditation

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1998 2000 2008 2009 2010 2017 2021
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The first TW pharmaceutical company to be ISO9001 certified

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The first TW company to pass US FDA SCP passed subsequent US FDA inspection in 2000 cGMP inspections without 483

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SCP received JP PMDA’s “Certificate of Foreign Drug Manufacturer” in 2008

FDF Plant and API Plant passed PMDA GMP Audit in 2018

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2009

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SCP’s API plant passed AU TGA inspection

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2010 SCP passed TW PIC/S GMP inspection 2012 SCP is certified GDP by the T-FDA 2012 SCP passed K-FDA inspection

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© 2022 SCP, Ltd

Agenda

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 Introduction of Standard Group  2021 Operating Results

 Future Operation Strategy  Corporate Social Responsibility (CSR)

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© 2022 SCP, Ltd

54 Years of Continuous Profit

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Profit Cash Dividends Stock Dividends EPS
800,000 4.50
3.95
4.00
700,000
3.50
600,000
2.93
3.00
500,000
2.50
2.09 [2.15 ] 2.09 2.09 2.11
2.03
400,000 1.95 1.90
1.77 [1.81 1.88 ]
2.00
300,000 1.35 [1.47 ] [1.61 1.73 ]
1.50
2.5
200,000
1.80 1.00
1.20 [1.50] [1.25] 1.20 [1.60] 0.50 1.00 1.20 1.00 1.50 1.50 1.60 1.50 1.50 Q
100,000 2.50 0.50
0.70
0.30 0.30
0 0.00
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2022 SCP, Ltd
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© 2022 SCP, Ltd

Consolidated Income Statement

Items	2021	2020	Diff.	Annual changes(%)
(Unless otherwise specified, expressed in thousands of New Taiwan Dollars)
Operatingrevenue	4,604,082	4,305,400	298,682	7%
Grossprofit	2,067,873	1,919,838	148,035	8%
Grossprofit margin	44.91%	44.59%		+0.3pct
Operatingexpenses	1,191,191	1,213,251	(22,060)	(2%)
Operating profit	876,682	706,587	170,095	24%
Non-operating income and expenses	137,068	66,340	70,728	107%
Profit before income tax	1,013,750	772,927	240,823	31%
Profit for theyear	836,802	625,560	211,242	34%
Profit attributable to owners of the parent	706,734	524,172	182,562	35%
EPS(NTD)	3.95	2.93	1.02	35%
2022 SCP, Ltd Note: SYN-TECH CHEM. & PHARM. Co., Ltd. Is consolidated into the financial report since 2021.12.08

© 2022 SCP, Ltd

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Comparison of Quarterly Revenue of Past 5 Years (Consolidated)

0 200,000 400,000 600,000 800,000 1,000,000 1,200,000 1,400,000 2017 2018 2019 2020 2021 21 Expressed in thousands of NTD 17 18 19 20 21 17 18 19 20 21 17 18 19 20 21 17 18 19 20	0 200,000 400,000 600,000 800,000 1,000,000 1,200,000 1,400,000 2017 2018 2019 2020 2021 21 Expressed in thousands of NTD 17 18 19 20 21 17 18 19 20 21 17 18 19 20 21 17 18 19 20	0 200,000 400,000 600,000 800,000 1,000,000 1,200,000 1,400,000 2017 2018 2019 2020 2021 21 Expressed in thousands of NTD 17 18 19 20 21 17 18 19 20 21 17 18 19 20 21 17 18 19 20	0 200,000 400,000 600,000 800,000 1,000,000 1,200,000 1,400,000 2017 2018 2019 2020 2021 21 Expressed in thousands of NTD 17 18 19 20 21 17 18 19 20 21 17 18 19 20 21 17 18 19 20	0 200,000 400,000 600,000 800,000 1,000,000 1,200,000 1,400,000 2017 2018 2019 2020 2021 21 Expressed in thousands of NTD 17 18 19 20 21 17 18 19 20 21 17 18 19 20 21 17 18 19 20	0 200,000 400,000 600,000 800,000 1,000,000 1,200,000 1,400,000 2017 2018 2019 2020 2021 21 Expressed in thousands of NTD 17 18 19 20 21 17 18 19 20 21 17 18 19 20 21 17 18 19 20	0 200,000 400,000 600,000 800,000 1,000,000 1,200,000 1,400,000 2017 2018 2019 2020 2021 21 Expressed in thousands of NTD 17 18 19 20 21 17 18 19 20 21 17 18 19 20 21 17 18 19 20
	Q1	Q2	Q3	Q4	Total	Growth (%)
2017	909,933	976,177	1,056,753	905,821	3,848,684	+5%
2018	763,261	897,693	913,353	998,786	3,573,093	-7%
2019	846,177	1,010,837	1,048,886	1,031,229	3,937,129	+10%
2020	1,034,417	1,108,059	1,045,351	1,117,573	4,305,400	+9%
2021	1,101,113	1,149,060	1,120,840	1,233,069	4,604,082	+7%
2022 SCP, Ltd

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© 2022 SCP, Ltd

Global Revenue – Export Sales Ratio of Past 5 Years (Consolidated)

International Domestic

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19.3% 80.7%
17.9% 82.1%
17.2% 82.8%
19.2% 80.8%
19.4% 80.6%
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2021 2020 2019 2018 2017

Expressed in thousands of NTD	2021	2020	2019	2018	2017
Export revenue	887,697	768,863	678,464	686,077	745,705
Total operating revenue	4,604,082	4,305,400	3,937,129	3,573,093	3,848,684

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© 2022 SCP, Ltd

Global Revenue Ratio Comparison-Export distribution (Consolidated)

50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 2021 Export sales increased by 118 million(15.5%) 2021 2020	50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 2021 Export sales increased by 118 million(15.5%) 2021 2020	50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 2021 Export sales increased by 118 million(15.5%) 2021 2020	50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 2021 Export sales increased by 118 million(15.5%) 2021 2020	50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 2021 Export sales increased by 118 million(15.5%) 2021 2020	50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 2021 Export sales increased by 118 million(15.5%) 2021 2020	50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 2021 Export sales increased by 118 million(15.5%) 2021 2020	50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 2021 Export sales increased by 118 million(15.5%) 2021 2020	50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 2021 Export sales increased by 118 million(15.5%) 2021 2020	50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 2021 Export sales increased by 118 million(15.5%) 2021 2020
0	S.E.A.	China	Other - Asia	Japan	Other - Americas	Europe	U.S.A	Africa	Other
2021	233,974	357,375	128,520	59,328	31,786	32,155	19,810	23,308	1,441
2020	248,996	225,978	96,179	51,289	43,263	40,945	32,724	29,341	149
SCP, Ltd

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© 2022 SCP, Ltd

Consolidated Balance Sheet

Items	2021	2021	2020	2020	Diff.	Annual changes(%)
(Expressed in thousands of NTD)	Amount	%	Amount	%
Cash and cash equivalents	2,564,395	25%	1,036,183	15%	1,528,212	147%
Accounts receivable	1,490,058	15%	967,254	14%	522,804	54%
Inventories	1,217,528	12%	893,512	13%	324,016	36%
Investments	904,243	9%	806,055	11%	98,188	12%
Property,plant and equipment	2,658,198	26%	2,125,207	30%	532,991	25%
Others	1,269,599	13%	1,221,236	17%	48,363	4%
Total Assets	**10,104,021 **	100%	**7,049,447 **	100%	3,054,574	43%
Current Liabilities	2,716,097	27%	1,650,616	23%	1,065,481	65%
Non-current Liabilities	588,310	6%	492,996	7%	95,314	19%
Total liabilities	3,304,407	33%	2,143,612	30%	1,160,795	54%
Total shareholder’s equity	6,799,614	67%	4,905,835	70%	1,893,779	39%
Debt Ratio(Abilities/Assets)		33%		30%
2022 SCP, Ltd Note: SYN-TECH CHEM. & PHARM. Co., Ltd. Is consolidated into the financial report since 2021.12.

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Note: SYN-TECH CHEM. & PHARM. Co., Ltd. Is consolidated into the financial report since 2021.12.08

© 2022 SCP, Ltd

Consolidated Cash Flows

Items	2021	2020
(Expressed in thousands of NTD)
Cash at beginning ofyear	1,036,183	1,471,902
Cash flows from operatingactivities	827,034	922,580
Acquisition ofproperty, plant and equipment	(126,817)	(307,126)
Cash dividends	(321,653)	(268,044)
Short-term borrowings	224,221	(299,000)
Investment and others(Note1)	925,427	(484,129)
Cash at end ofyear	2,564,395	1,036,183
Free cash flow(Note2)	700,217	615,454

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• Note1 Increased due to cash obtained from the consolidation of SYN-TECH CHEM. & PHARM. Co., Ltd. on 2021.12.08. *** Note2 Free cash flow = Cash flows from operating activities minus Acquisition of property, plant and equipment**

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© 2022 SCP, Ltd

Agenda

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 Introduction of Standard Group

 2021 Operating Results

 Future Operation Strategy

 Corporate Social Responsibility (CSR)

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© 2022 SCP, Ltd

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Future Milestone

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From Taiwan to International From Generics to Better than Generics (BTG)

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© 2022 SCP, Ltd

SCP – Major International Businesses of the Past 2 Years

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Taiwan

• Prompt delivery of drugs during COVID-19 due to well-managed production and sales coordination.

• SCPs cumulated sales and profit have hit a historic high even after deducting one-time revenue.

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China

• Continues export of antibiotic injection. • Generic Quality Consistency Evaluation(GQCE) ： 3 cases were closed; 5 ongoing applications. • Self-developed generic drug: 2 NMPA items under review, 2 BE studies in process.

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Japan

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• Bronchiolitis drug, non​steroid anti-inflammatory drugs are delivered persistently.

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• CDMO/CMO items under discussion.

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© 2022 SCP, Ltd

Taiwan investment to enhance R&D capacityInvestment to Ho Yao Bio harm Co. Ltd. , p

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• Investment time: Y2022

Profile

• Capital：NT43.33 million

• Stock owned by SCP：85%

• Location：Hsinchu Science Park

Ho Yao

Biopharm

• R&D team：Jim Huang

• Specialty： • 505(b)2 New drugs

• • High threshold generic drugs

• • Orphan drugs

R&D Capa -city

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© 2022 SCP, Ltd

Revenue Growth Strate - China gy

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Competitiveness

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• SCP has successful experience with U.S. and Japan regulatory dossiers

NMPA review of importation

• Expertise in Fasting & Fed BE design and execution

Medium-term targets

NMPA Consistency Evaluation

 Self-developed products submission

• 8 contracts signed, 3 cases were closed, and 5 ongoing cases

• Enhance profit sharing revenue

Cooperation

Strategy

 Tech-transfer

• Emphasize export and tech transfer simultaneously.

 License cooperation

• Co-development

• Increase the number of cooperative projects and pharmaceutical companies

• Profit-sharing Partnerships

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© 2022 SCP, Ltd

China Market Trends: The 14[th] Five-year Plan for Pharmaceutical Industry development

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Steady Growth in Turnover Int’l Develop. Acceleration

• Revenue and gross profit growth by 8% and above.

• Increasing drugs export

• Improve the concentration of leading companies.

• To foster global pharmaceutical companies, and build worldrenowned brands

Enhance Manufacturing Standard Ensure Stable Supply

• Increase the number of generic drugs that pass the consistency evaluation.

• Strengthen quality super vision, Longterm and stable supply of essential drugs, urgently needed children’s drugs, and orphan drugs.

Industrialized Tech. Breakthrough Transformation driven by Innovation

• Strengthen key core technologies and enhance industrial chain advantages.

• • Promote the integration of Chinese

• • pharmaceutical companies into the international market.

• Promote the industrialization and

• application of new drugs and high-end medical devices.

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China Market Trends: Market situation

• The scale of Chinese drug market has continued to grow in recent years. Although it has declined slightly in 2020 due to the impact of COVID-19, it will rebound after the epidemic has stabilized in 2021. It is estimated that there is still room for growth in the future.

Chinese Drug Market Scale

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14,000 10.0%
8.6%
7.7%
12,000 6.5%
5.0%
11,565 11,425
10,000 10,742 12,319 11,122
2.7%
0.0%
8,000
6,000
-5.0%
4,000
-9.7% -10.0%
2,000
0 -15.0%
Year 2017 2018 2019 2020 2021
整體銷售額 Sales 整體增長率 Growth rate
Source：
www.menet.com.cn
China CMH (second-level and public hospital)
Sales (CNY100million)
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© 2022 SCP, Ltd

Revenue Growth Strategy - Japan

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Collaboration Model Strategy

• Agent for brand drugs.

• CDMO

• Collaboration with local company in different market.

• Japan marketing partner

• Strategic alliance with API manufacturer.

• API Vertical Integration with Syn-Tech.

• License Holder

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•
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Current State

On Going

• Obtained marketing licenses for Montelukast (Asthma) and Celecoxib (Anti-inflammatory)

• CDMO/CMO

• Common items for China/ Southeast Asia/ Japan are under discussion

• Obtained agency for gout new drug.

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Ja an Market Trend
p
•
New target of Japanese Ministry of Health and Welfare(MHLW): The
usage of generic drugs must reach 80% by 2023.
•
MHLW encourages the use of generic drugs, which mainly focus AG
and biosimilar drugs, but with limited growth.
Japan generic drugs market scale changes
Changes for CAGR
Japan generic drugs market volume 1200 (2019E~)
81
25.2%
78.30% 47
72.60% 1000 22 160 10.4%
13 15 129
76.70% 10 42 75 104
56.20% 800 24
65.80% (New target)
Estimation of
600
reaching 80% of
generic drugs 400 839 815 830 851 883 Q
usage countrywide 763
3.2%
200
0 22
2014 2016 2018 2020 2022 2024
2015 2016 2017 2018 2019 2020
© 2022 SCP, Ltd Generic AG Biosimilar
JPY Billion
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Revenue Growth Strate – U.S.A. gy

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U.S.A. Market

• Largest Rx Market, with large proportion of generic drugs.

• Characterized by lengthy review timelines and costly

• compilation and filing work

• SCP’s long term goals. Current Status

Strategy

• Co-develop new products with pharmaceutical companies and dealers.

• API Vertical Integration with Syn-Tech.

• Export of diabetic and myotrophic lateral sclerosis(ALS) drugs.

• 2 drugs was P4 approved (drugs will be lunched during 2023 and 2024)

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© 2022 SCP, Ltd

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US Market Trend

• The US House of Representatives passed nearly 2 trillion social spending bill. The government will intervene in negotiations to lower the prices of old and high-priced drugs.

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• In 2020, the sales volume of generic drugs reached 91.3%, but only accounted for 19% of sales amount.

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Sales amount
100%
90%
25.2% 23.2% 21.3% 20.0% 19.0%
80%
70%
60%
50%
74.8% 76.8% 78.7% 80.0% 81.0%
40%
30% Q
20%
10%
0%
2016 2017 2018 2019 2020 24
原廠藥Brand Drug 學名藥Generic Drug
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Sales volume

	0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%	10.4% 89.6%	9.4% 90.6%	9.3% 8.9% 90.7% 91.1%	9.3% 8.9% 90.7% 91.1%	8.7% 91.3%
		2016	2017	2018	2019	2020
©	2022 SCP,	Ltd	原廠藥 Brand Drug		學名藥 Generic Drug

US FDA overseas sur rise ins ection p p

Due to the increasing demand for inspection and to avoid prior notification given to manufacturers sufficient time to prepare, FDA announced this year that it will develop a plan to conduct unannounced inspection of overseas pharmaceutical facilities, with purpose to enhance foreign manufacturers to comply with the quality and safety standards accordingly, and without concealment acts. • Surprise inspection started from India and China. • Other countries inspection will resume from February. • Manufacturers should be ready any time from inspection.

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© 2022 SCP, Ltd

Source: GAO analysis of Food and Drug Administration data

Future Operation Strategy

Future From Taiwan to International From Generics to BTG

2023

2022 China

USA、Japan

Core techniques and Increasing oversea professional Global marketing Marketing revenue 增加海 核心技術 skills to expend & 專業 海外市場操作 practices global sales turnover 借力使力 外比例

• Enhance oversea sales’

Mature R&D techniques to create turnover

 Foundation improvement

resources

• To speed up turnover

• Hire international

• Explore and learn different market rules

talents

• Seeking medium to long-term partnership

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© 2022 SCP, Ltd

President Tsai Ing-Wen meet with winner of 2021 Outstanding Biotechnology Industry on Feb. 2022  Mr. Tzu-Ting Fan, general manager of the company received souvenirs on behalf of the winning units

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Agenda

 Introduction of Standard Group

 2021 Operating Results

 Further Operation Strategy  Corporate Social Responsibility (CSR)

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Fan Dao Nan Foundation

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Fan Dao Nan Foundation

• Established in 1987

• Endowment Fund: NT$196 Million

 Annual Budget: NT$12 Million

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Principal Activities

• Non-profit education

• Cultural and educational development activities

• Sponsor R&D and Innovation

• Scholarships and Talent Cultivation

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Rewards and Honors Received

 2011: Special Recognition Award – Dept. of Education

• 2012: Tainan City Govt. Grant for Scholarship Program

• 2013: National Special Selection Award for After-School Program – Dept. of Education

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Cor orate Social Res onsibilit in 2021 p p y

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Scholarships

Sunflower Wednesdays

Hope After-school Class

• University (related fields): 4universities/5

• students

˙Weekday afternoons

˙Every Wednesday afternoons ， ˙4 Schools 232student Total scholarship NTD 350KK

• High school :8 schools, totaled 143 students

， ˙19 schools 1,235students

• Middle school:57schools, totaled 734 students  Elementary school :236schools,totaled 2,782 students

Total scholarship NTD 1.13MM

Total scholarship NTD 6.37 MM

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Other Sponsorships

 Sponsorship to 12 non-forprofit organization for cultural and educational advancement

Grant Total- NTD 330KK

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Meal-Assistance

 In 2021, provided 6,896 meals to students during winter and summer vacation. Assisted Total- NTD 470KK

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Charity

• SCP Children’s Drawing

• Competition  SCP National Table Tennis Q

• Competition*

Suspended due to Covid-19 in 2021

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The First Senior Gym in Taiwan – Athletic Training and Health Center

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Year 2021,

• The number of users is accumulated 152,279 user time.

• 24 healthy lectures were conducted that provide disease and healthcare knowledge.

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Free Bone Mass Measurement and Community Health Seminar

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Year 2021,

• 8 sessions of free bone mass measurement activity have been held and 920 people participated the activity.

• 8 sessions of community health lectures have been held, with a total of 500 participants.

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The First Senior Gym in Taiwan – Athletic Training and Health Center

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From Jan. to Sep. of 2021,

• The number of users is accumulated 79,245 user time.

• 5 healthy lectures were conducted that provide disease and healthcare knowledge.

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Free Bone Mass Measurement and Community Health Seminar

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From Jan. to Sep. of 2021,

• 3 sessions of free bone mass measurement activity have been held and 230 people were measured.

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Q

• 2 sessions of community health lectures have been held, with a total of 70 participants.

© 2022 SCP, Ltd

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Q & A

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