S.C.P.C — Investor Presentation 2019

Nov 20, 2019

股票代號 :1720

Standard Chem. & Pharm. Co., Ltd. (SCP)

Investor Conference 2019.11.21

免責聲明 Safe Harbor Notice

• 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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Agenda

Introduction to 2019 Corporate Standard Financial ForwardSocial Pharmaceutical Results Responsibility looking Group (CSR) through Q3 (SCP Group)  Historical    Consolidated Actions for Fan Dao Nan Milestones Financial Revenue Growth Foundation  Resource Statements  ForwardIntegration • Status of looking Strategy  Historical Internationalization Financial Performance

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Introduction to Standard Pharmaceutical Group (SCP Group)

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SCP’s International Honors

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1998 2000 2008 2009 2010 2017 2018
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1998 SCP is the first Taiwanese pharmaceutical company to be ISO9001 certified

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2000 SCP is the first TW pharmaceutical company to pass US FDA inspection

SCP continuously passed US FDA follow-up inspections with no 483s

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

2018 FDF Plant and API Plant passed PMDA inspection

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2009 SCP’s API plant passed TGA inspection

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2010 SCP passed TW PIC/S GMP inspection 2012 SCP passed TFDA GDP inspection

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2012 SCP passed K-FDA inspection, and is certified GDP by the T-FDA

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Associated and Related Company of SCP

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1967 1982 1995 1999 2005 2016 2019
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1967 Founded 1995 Became listed company in TWSE

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1982 Founded 2005 Became listed company at OTC exchange 1999 Founded 2016 Became listed company at OTC exchange 2012 Invested Multipower Enterprise Corp. 2013 Invested YourChance Drug Store Chain 2017 Invested Taiwan Biosim

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Syn-Tech Chem. & Pharm. Co., Ltd History

2004 2014  Passed OHSAS 18001 Received Taiwan Pharmaceutical 2000  2009 Industry Research and Received by the DOH for Passed ISO 14001 approval cGMP Award Received Taiwan Development Awards 1995 Pharmaceutical Industry Passed US FDA inspection; Research and Development products were exported Awards to the US 1982 2000 2010 2020 1998 2008 2018 1982  Received the Award Officially ˙ Top 5% of Corporate Governance Evaluation Syn-Tech in the Category of listed in the was founded both API 2002 OTC market of the listed company at  Received Industrial Sustainable OTC market for four Pharmaceutical Plant Development Excellence Award 2011 consecutive years and single product  Received with the Received the from the National Pharmaceutical National Outstanding SMEs Award SMEs Innovation Quality Award. Award  Passed ISO9001 certified

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Syngen Biotech. Co., Ltd History

2017 2019  Passed US NSF 2011 2014  Received the Golden 2004 Received the Copper Prize of  Received National inspection Award of The 33[rd] Received the Silver Prize of the  Received National Biotechnology Medical World Genius Taiwan Pharmaceutical Industry Taiwan healthcare and agricultural Quality Award Innovation Award Convention & Research and Development biotech ingredients innovation  Received Golden Education EXPO and excellence awards Awards Award of Taiwan  Received the Silver Pharmaceutical Industry Award of Globalizing Research and Award, Taipei Biotech Development Awards Awards 1999 2000 2015 2020 1999 2016 Syngen Officially listed in the was founded OTC market 2012 2018 2010  Acquired HACCP  Passed US FDA inspections with no 483s  Passed ISO9001 and certificate  Received the Golden Prize of Malaysia ISO22000 ITEX  Received the Excellence Award of Globalizing Award, Taipei Biotech Awards 8

 Standard Chem.& Pharm.Co.,Ltd  Souriree Biotech.Co.,Ltd.

• (Syn-Tech Chem. & Pharm. Co., Ltd.)

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Western
Pharmaceuticals
- Rx
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 Syngen Biotech Co., Ltd.

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API
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Software/
Hardware
Service

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• ( CNH)

SCP Group Resource Integration Related Company

 Inforight Technology Co., Ltd.

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Biological
Fermentation
Products
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 AdvPharma, Inc.

• Multipower Enterprise Corp.

• Syngen Biotech.Co.,Ltd

• (Your Chance Pharmacy Chain)

• (Sun You Biotech Pharm.Co.,Ltd)

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52 Years of Continuously Profitable (15 years of Profit and Dividend Performance)

Income after Taxes

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EPS
(Expressed in thousands of New Taiwan Dollars)
Net Income Cash Dividend Stock Dividend EPS
400,000 3.00
350,000
2.50
300,000
2.15
2.09 2.09 2.09
2.03 2.00
1.95
250,000 1.88 1.90
1.81
1.77
1.73
1.61
1.56
200,000 1.47 1.50
1.35
2.50
150,000
1.00
0.50
1.20 1.20
1.60 1.60
100,000 1.50 1.50 1.50 1.50
1.25 1.20
1.00 1.00 0.50
50,000 0.70
0.30 0.30
0 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
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(Expressed in thousands of New Taiwan Dollars)

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2019 Financial Results through Q3

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Income Statement (Consolidated)

(Expressed in thousands of New Taiwan Dollars)

~~Growth~~	~~Growth~~	~~Growth~~	~~Growth~~	~~Growth~~	~~Growth~~	~~Growth~~
~~(±)~~ ~~Rate~~ Amount % Amount % Amount % 2019 (Q1~Q3) 2018 (Q1~Q3)
Operatingrevenue 2,905,898 100 2,574,307 100 331,591 13
Operatingcost	1,653,061	57	1,452,919	57	200,142	14
Grossprofit 1,252,837 43 1,121,388 43 131,449 12
Operatingexpense	899,565	31	846,160	33	53,405	6
Operating profit 353,272 12 275,228 10 78,044 28
Non-operating income and expense	89,147	3	98,783	4	-9,636	-10
Income before tax 442,419 15 374,011 14 68,408 18
Net Income	349,651	12	312,664	12	36,987	12
Net income attributed to Stockholders of the Parent Company 279,115 10 279,844 11 -729 0
EPS(NT$)	1.56		1.57		-0.01	-1

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Balance Sheet (Consolidated)

(Expressed in thousands of New Taiwan Dollars)

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2019/9/30 2018/9/30
Amount % Amount %
Cash and cash equivalents 1,402,403 21 893,312 14
Accounts receivable 951,913 14 948,891 15
Inventories 907,278 13 831,266 13
Investments 560,860 8 616,374 10
Property, plant, and equipment 2,114,539 31 2,147,236 34
Other current and non-current assets 924,792 13 902,856 14
Total Assets 6,861,785 100 6,339,935 100
Current Liabilities 2,023,565 29 1,647,545 26
Long-term loans 84,691 1 189,799 3
Other liabilities 458,960 7 323,617 5
Total liabilities 2,567,216 37 2,160,961 34
Total shareholder's equity 4,294,569 63 4,178,974 66
Total liabilities and shareholder's equity 6,861,785 100 6,339,935 100
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Global Revenue Ratio of past 5 Years (Consolidated)

(Expressed in thousands of New Taiwan Dollars)

 International Sales of past 5 years

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1,000,000
745,705
800,000
686,077
644,528
600,000 490,991
445,642
400,000
200,000
-
2015 2016 2017 2018 2019(Q1~Q3)
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 Ratio of International-to-Domestic Sales of past 5 years Domestic Sales Export Sales

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100% 13.4% 17.5% 19.4% 19.2% 16.9%
80%
60%
86.6% 82.5% 80.6% 80.8% 83.1%
40%
20%
0%
2015 2016 2017 2018 2019(Q1~Q3)
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 International Revenue (Ex-Taiwan)

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2019 (Q1~Q3) 2018 (Q1~Q3)
250,000
40%
200,000
35%
150,000 27%
22%
20%
100,000
11%
50,000 6% 5% 6% 5% 6% 4% 5% 5%
2% 1% 0% 0%
0
S.E.A Other-Asia China U.S.A. Europe Other-Americas Africa Japan Others
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Comparison of Quarterly Revenue of past 4 years (Consolidated)

(Expressed in thousands of New Taiwan Dollars)

									(Expressed in thousands	o
0 200,000 400,000 600,000 800,000 1,000,000 1,200,000
		Season 1			Season 2		Season 3		Season 4
			2016		2017		2018 2019
	Consolidated Revenue		Season 1	Season		2	Season 3		Season 4 Annual Statistics
		2016	859,024		940,238		919,663		954,876 3,673,801
		2017	909,933		976,177		1,056,753		905,821 3,848,684
		2018	763,261		897,693		913,353		998,786 3,573,093
		2019	846,175	1,010,837			1,048,886

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Forward looking Strategy

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Future Milestone

Taiwan Generics

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International Better than Generics

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SCP – Major International Operations of the past 2 years

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Taiwan China Japan
 
Agent for brand drugs Continuously commercialized 
Continuously exported
 Exclusive agent for 20 opportunities through Generic Bronchiolitis medication
Mylan anticancer drugs Quality Consistency 
Anti-inflammatory Oral
 Continuously developed Evaluation(GQCE)
Solid Dosage started to
high technical threshold  Applied for approval of own ship out in 2019 ；
generic drugs products schedule to launch in 2020
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Revenue Growth Strategy - Taiwan

• Taiwan as Base of Operations for Global R&D and Pharmaceutical Manufacturing

• Yearly increase of international operations ratio.

• Support the technologies and products required by the international market (US, China, Japan, ASEAN)

• Strengthen Manufacturing Capability

• Manufacturing line complies with international standards; have passed numerous international audits

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• Production line simplification

• Continuing production expansion and upgrade equipment

 Distribution ：

• Distribute Japanese brand psychiatric drug aiming at more than NT$100 million revenue in 2020.

• Distribute 20 Mylan anticancer drugs in Taiwan

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Distribution of 20 Mylan anticancer drugs in Taiwan

• 5 kinds of Macromolecules

• Biopharmaceutical - Biosimilar

• 3 ingredients, 5 drug licenses

• 3 drug licenses have been approved in Taiwan

• 1 drug was officially approved with NHIA reimbursement price

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• 15 kinds of Small Molecule Drugs

• 9 ingredients, 15 drug licenses

• 12 drug licenses have been approved in Taiwan

• 11 drug was officially approved with NHIA reimbursement price

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Mylan Ogivri

 Herceptin

• The product is ranked 4[th] in global drug sales, and it has taken the first spot of cancer NHIA expenditures for many years.

• The product was approved with NHIA reimbursement price in 2002, and the current NHIA reimbursement Price: NT$46,895/dose; 2018 annual NHIA expenditure was NT$2.206 billion with 5,030 applicants.

 Mylan Ogivri

• The product was approved and launched in the U.S. in December 2017, and also approved in Taiwan in December 2018; it’s expected to ship out in December 2019.

• NHIA reimbursement Price: NT$ 39,860/dose, one dose usage for every 3 weeks, around 18 doses each year

• 、 、

• Indication: EBC MBC MGC

 Breast Cancer Patients

• Breast cancer takes the first place of Taiwanese female cancer, with the fourth spot of leading cause of death

• Breast cancer patients are increased 12,000 every year in Taiwan

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Revenue Growth Strategy - China

SCP Competitiveness

 SCP has successful experience with c U.S. and Japan regulatory dossiers  SCP to continue to specialize expertise in BE design and execution Mid-Term Goals

• Increase technology in-flow

• Increase revenue from profitsharing

Collaboration Model

 Tech-transfer

 Co-development

• BE Collaboration

• Profit-sharing Partnerships

Drug Licenses Review

• Continuously ship antibiotic injection products

• Expect to launch diabetes products in 2021

NMPA GQCE

• 2017: 2 contracts signed

• 2018: 5 contracts signed  2019: expected to sign 1 contract  2020: aiming to sign 6 contracts

• Results

 Increase the number of cooperative projects and cooperative pharmaceutical companies

• Diversified corporation structure

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NMPA Reforms: GQCE 【 Revised 】

 Cost of Research and Development

• According to Pharmcube’s statistic, for listed companies, there are 77 items passed Generic Quality Consistency Evaluation, and 11 of the passed items cost more than NT$ 10,000,000 in research and development.

 Revised status of GQCE

	Revised Docs with No.	Items	Entities
Total in 2018.12(PS.1)	676	231	249
Total in 2019.03(PS.2)	1,102	336	361
Total in 2019.11(PS.2)	1,695	456	476

PS.1 ： 2018.12.29 www.yaozh.com Report of CDE Statistics PS.2 ： 2019.04.02 ， 2019.11.04 信狐藥訊

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NMPA Reforms: GQCE 【 Submissions 】

• The submission is still heat up, 2017.07~2019.09 Consistency Evaluation: 1,469 submissions were revised in total

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NMPA Reforms: Total revised & approved submissions

• 2017.07~2019.09 1,469 submissions were revised in total, 360 submissions were passed

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Source ： www.yaozh.com Report of CDE Statistics

NMPA Reforms: GQCE 【 Passed 】

 Up to October 2[nd] , 2019, 32 ingredients have more than 3 approved sources.

 143 pharmaceutical companies totally have 345 items (including 202 ingredients) which has passed GQCE.

No.	Items	passed GQCE companies
1	Amlodipine Besylate Tablets 5mg	11
2	Montmorillonite Powder 3g	10
3	Tenofovir Disoproxil Fumarate Tablets 0.3g	9
4	Metformin Hydrochloride Sustained-Release Tablets 0.5g	9
5	Cefuroxime Axetil Tablets 0.25g	7
6	Metformin Hydrochloride Tablets 0.25g	7
7	Rosuvastatin Calcium Tablets 10mg	6
8	Levocetirizine Hydrochloride Tablets 5mg	6
9	Rosuvastatin Calcium Tablets 5mg	5
10-21	12 Pharmaceutical Ingredients	4
22-32	11 Pharmaceutical Ingredients	3

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Source ： 2019.10.02 China media Saibailan report materials

The ranking of Top 10 Pharmaceutical Companies which passed GQCE

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Source ： 2019.10.02 China media Saibailan report materials

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Revenue Growth Strategy - Japan

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Collaboration Model

 Japanese Distribution Partner

 Contract Development, SCP Manufacturing

• License Holder

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Current State

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Raw Material Strategy

 Collaborate with Syn-Tech Chem. & Pharm. Co., Ltd.

 API Vertical Integration

Under Development

 Obtained marketing license for Montelukast (Asthma), 3[rd] straight year of continuous export

 Co-development of Nonsteroidal Antiinflammatory Drug (NSAID) – passed BE in 2018

• Start exporting in 2019; expect to receive license in the first quarter of 2020.

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Revenue Growth Strategy – U.S.A.

U.S.A. Market

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U.S.A. Market

• Largest Rx Market

• Characterized by lengthy review

• timelines.

• Expensive compilation and filing

• costs

• Part of SCP’s long term goals

Strategy

• Collaboration with

Syn-tech Chem. & Pharm. Co. Ltd.

• API Vertical Integration via strategic partnerships

Current State

• Actively export one diabetic treatment

• One approval, pending patent settlement terms

• Two ANDA’s under review

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Forward-looking Strategy Layout

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Future:
2020 2021 2022
International
China Japan U.S.A. - -
Better than Generics
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Increase
International
Revenue Ratio
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• Increase international business resources

• Recruit international talent

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Specialized technology and
professional development of
international performance
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• Develop Taiwan into

• a base of cutting-edge R&D technology and revenue generation.

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Leverage
Competitiveness in
Overseas Markets
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• Stable foundation

• Rapid revenue creation

• Step-by-step optimization

• for minimization of loss

• Focus on market knowledge

• and business acumen

• Establish strategic

partnerships for mid- and long-term goals

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Corporate Social Responsibility

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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

Principal Activities

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 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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Corporate Social Responsibility

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Hope After-school Class

Scholarships

 University (related fields): 2 universities/5 students  Weekday afternoons  High school: 8 schools/113 students  18 schools  Middle school: 56 schools/814 students  1,520 students  Elementary school: 232 schools/2,681 students Scholarship Totals – NT$1.9M Scholarship Totals – NT$6M

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Sunflower Wednesdays

 Every Wednesday afternoon  4 schools  310 students Scholarship Totals – NT$250K

Other Sponsorships

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Meal-Assistance

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Charity

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 Member of 19-corporation  In 2018, provided 7,325 meals to alliance for sponsorship cultural students during winter and summer and educational advancement holidays.

 SCP Children’s Drawing Competition  SCP National Table Tennis Competition

Grant Total – NT$500K

Assistance Totals – NT$440K

Prize Totals – NT$1.65M

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Public Service Activity: Bone Mass Measurement

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• Cooperate with medical institution, local community, and pharmacy for conducting public service activity: bone mass measurement.

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

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• Location: Chiayi Yangming Hospital (No. 383, Minquan Road, West District)

• Intelligentized analysis of test result; customized design for sports course

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• Provide a comfortable and professional health promotion place for middle-aged and senior people

• From July 2019 to the end of October, the total user count is about 1,400.

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Q & A

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Thanks for your attention

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