SPT — Annual Report 2020

Aug 9, 2021

TSE Code 1789

ScinoPharm Taiwan, Ltd. 2020 Annual Report

Notice to readers

This English-version annual report is a summary translation of the Chinese version and is not an official document of the shareholders’ meeting. If there is any discrepancy between the English and Chinese versions, the Chinese version shall prevail.

Taiwan Stock Exchange Market Observation Post System: http://mops.twse.com.tw

ScinoPharm Taiwan, Ltd. Annual Report is available at: http://www.scinopharm.com.tw

Printed on 04 30, 2021

Spokesperson

Name: Li-An Lu Title: Vice President of Administration Tel: 886-6-5052888 E-mail: Investor@scinopharm.com

Headquarters, Branches and Plant

Headquarters Address: No.1, Nan-Ke 8th Road Southern Taiwan Science Park Shan-Hua, Tainan, 74144, Taiwan Tel: 886-6-5052888

Deputy Spokesperson

Name: Chih-Hui Lin Title: Senior Director of Accounting Tel: 886-6-5052888 E-mail: Investor@scinopharm.com

Stock Transfer Agent

President Securities Corporation Address: B1, No.8, Dongxing Rd., Taipei City Tel: 886-2-2746-3797 Website: Http://www.pscnet.com.tw

Auditors

PricewaterhouseCoopers, Taiwan Address: 12F, 395 Linsen Rd., Sec. 1 Tainan, Taiwan 70151 Tel.: 886-6-234-3111 Website: http://www.pwc.tw/

Overseas Securities Exchange

Not applicable

Corporate Website

http://www.scinopharm.com.tw

II

Contents

I Letter to Shareholders .......................................................................................... 1 II. Company Profile ................................................................................................. 3 2.1 Date of Incorporation ................................................................................... 3 2.2 Company History ......................................................................................... 3 III. Corporate Governance Report .......................................................................... 6 3.1 Organization ................................................................................................ 6 3.2 Information on Directors and Management Team ....................................... 8 3.3 Remuneration paid to Company directors, president, and senior vice presidents over the past year .................................................................... 25 3.4 Implementation of Corporate Governance ................................................. 30 3.5 Information Regarding the Company’s Audit Fee and Independence ....... 79 3.6 Replacement of CPA ................................................................................. 79 3.7 If the Company's Chairman, President, or managers responsible for financial and accounting affairs have held any position in the accounting firm or its affiliates during the past year, all relevant information should be disclosed ................................................................................................... 79 3.8 Net Change in shareholdings and in shares pledged by directors, management, and shareholders holding more than a 10% share in the Company ................................................................................................... 80 3.9 Relationship among the Top Ten Shareholders ........................................ 82 3.10 Ownership of Shares in Affiliated Enterprises .......................................... 89 IV. Capital Overview .............................................................................................. 90 4.1 Capital and Shares .................................................................................... 90 4.2 Bonds ........................................................................................................ 93 4.3 Status of Corporate Bonds, Preferred Stock, GDR, Employee Stock Option Plan, Employee Restricted Stock Plans, Mergers, Acquisitions, and SpinOffs ........................................................................................................... 94 4.4 Financing Plans and Implementation ......................................................... 95 V. Operational Highlights...................................................................................... 96 5.1 Business Activities ..................................................................................... 96 5.2 Market and Sales Overview ..................................................................... 103 5.3 Human Resources ................................................................................... 116 5.4 Environmental Protection Expenditure .................................................... 116 5.5 Protective measures for workplace and personal safety of employees ... 118

III

5.6 Labor Relations ....................................................................................... 121 5.7 Important Contracts ................................................................................. 124 VI. Financial Information .................................................................................... 127 6.1 Five-Year Financial Summary ................................................................. 127 6.2 Five-Year Financial Analysis ................................................................... 131 6.3Audit Committee’s Report in the Most Recent Year ................................. 135 6.4 The Audited Consolidated Financial Report for the most Recent Fiscal Year ........................................................................................................ 135 6.5 The Audited Parent Company only Financial Report for the most Recent Fiscal Year .............................................................................................. 135 6.6 Financial Difficulties ................................................................................. 135 VII Review of Financial Conditions, Operating Results, and Risk Management ................................................................................................. 136 7.1 Analysis of Financial Status ..................................................................... 136 7.2 Analysis of Operation Results .................................................................. 137 7.3 Analysis of Cash Flow ............................................................................. 138 7.4 Major Capital Expenditure Items .............................................................. 139 7.5 Investment Policy in Last Year, Main Causes for Profits or Losses, Improvement Plans and the Investment Plans for the Coming Year ....... 139 7.6 Analysis of Risk Management ................................................................. 140 7.7 Other Important Matters .......................................................................... 149 VIII.Special Disclosure ........................................................................................ 150 8.1 Summary of Affiliated Companies ........................................................... 150 8.2 Private Placement Securities in the Most Recent Years .......................... 159 8.3 The Shares in the Company Held or Disposed of by Subsidiaries in the Most Recent Years .......................................................................................... 159 8.4 Other Necessary Supplement .................................................................. 159 8.5 Other Supplementary Disclosure ............................................................. 160

Appendix A Appendix B

IV

I. Letter to Shareholders

In 2020, the whole world was severely impacted by COVID-19. It was a very difficult year for all industries. COVID-19 started off as a regional epidemic found only in China, and soon spread to the rest of the world resulting in border lockdowns. The World Health Organization has also officially defined COVID-19 as a pandemic. All these changes are affecting and influencing wide range of industries in a persistent manner. ScinoPharm, however, at the face of the highly uncertain global market, maintained consistently healthy operations against the adverse conditions last year, and kept moving forward in accordance with its strategic deployment, achieving set targets of revenue and profit. By doing so, the company manifested its resilience and business strength in quickly adapting itself to the environment.

The company’s consolidated revenue for 2020 was NT$3.083 billion, net profit after tax was NT$282 million, and after-tax earnings per share was NT$0.36. As of the end of 2020, the company’s paid-up capital was $7.907 billion, and shareholder’s equity $10.529 billion, which accounted for approximately 89% of its total assets of $11.847 billion; long-term capital 2.65 times the value of its fixed assets, with a current ratio of 8.62, maintaining a sound and healthy financial structure.

Maintaining stable operations and continuing to build up its strength to cope with challenges

In general, the clients’ demand for API products continued to grow last year. However, due to the impact of COVID-19 prevention policies and measures in various locations, global logistics and transportation was in an extraordinary period, with restricted import and export channels, resulting in a delay by suppliers of main raw materials in performing their contracts to service certain manufacturing processes. This has hindered the production and sales of API products to a certain extent. Due to completion of pre-production works such as material preparation in the year before, coupled with the properly adapted production schedule as well as sales and transportation planning, the company has managed to keep its scheduled production activities and sales substantially unaffected for the first half of the year, despite the enhancing isolation, border control, distancing or split team rotational arrangements at different stages in different countries to contain the virus. However, starting from the second half of the year, with the aggressively accelerated impact of COVID-19 on the US market, and the sign of its return as a mutated version, countries led by the United States have become more actively involved in the research and development of vaccines and products that might become therapeutic drugs. As a result, some customers re-adjusted their shipment schedules, to which the company also adapted its production and sales planning. The performance of outsourced R&D services has benefited from the flexible sales strategies, periodic stocking requirements and the customers’ great ambitions in developing products to address new indications, becoming a highlight of last year’s business performance.

The process of new product launch accelerates vertical integration and synergies of synchronized development

On the part of development of the API business, ScinoPharm’s Changshu plant, for the first time last year, underwent the onsite inspection by the China National Medical Products Administration for the first time for food and drug registration, and the China GMP compliance inspection for two items. It is expected to be approved for marketing in China this year. This product is an emergency medicine against rare diseases, for which there is currently no alternative treatment. Once the marketing license has been obtained, large-scale commercial production will be carried out; and customers are optimistic about the market potential of this product and it is expected to become the one of the knock-out products of Changshu plant going forward. This year in China, it is expected that three more products developed in partnership with customers will go through the dynamic verification with the regulatory authorities, and the company remains optimistic about the prospects and development of the China market. Progress has also been made in the development of injectable products. The company’s first home developed and manufactured injectable generic peptide product has been put through to the US Food and Drug Administration for review and approval. The strategy of extending the life cycle of existing products through vertical integration is in gradual implementation. Crossing over into complex

~1~

injectable products is the first step of ScinoPharm’s business expansion. In the future, it will not only continue to invest in the R&D and production of injectable products and establish strategic alliances that will be additive and multiplicative to seize the injection market; and it is also optimistic about the potential of the oral administration market, seeking to open up a brand new space in the highly competitive pharmaceutical industry.

Attaching importance to organizational safety with continuous review and management of operational risks

In order to maintain a safe and sound workplace, the company has always applied a high standard to and involved the entire staff in safety management, with ongoing review of the existing safe work process for compliance with the current requirements, and checking on whether the process has been carefully implemented. To enhance industrial safety and environmental protection, considerable manpower and funds are being invested as planned. Last year saw the phase two expansion of the warehouse and transformation of the dangerous when wet warehouse. Old pipelines that have reached the end of service life are replaced and improved, with the addition of monitoring systems and waste treatment equipment, enhanced safety inspections and audits, and upgraded protection equipment for production and operation, in an effort to comprehensively improve protection, industrial safety and discipline. The goal is to maintain effective control over and to reduce fire and explosion caused by unpredictable natural disasters, earthquakes, use of solvent and high-risk operations, or personal injuries caused by insufficient protection and operational errors. The company attaches great importance to safety and never compromises. It is a basic requirement to implement safety regulations, and the highest guiding principle and goal to totally eliminate industrial safety incidents attributable to man.

Adhering to quality standards in pursuit of a perfecting quality culture

As a member of the global pharmaceutical supply chain, "Compliance and Legal" is the basic requirement for the manufacture process and quality of products. In order to ensure product quality, efficacy and the safety of drug users, the company has consistently applied the most prudent management approach to the development and production of every product, with spirit of never giving up. Since the establishment of the company, the existing organizational structure and management system are already well established. It is another challenge as to how to continuously and seamlessly implement the existing quality management structure, promptly adapt itself to changes in the laws and regulations of different jurisdictions, and enhance the implementation of knowledge management and the carry-forward of experience. We firmly believe it is the responsibility of the wider company to implement our quality culture. We proactively advocate the development of thinking and behaviors necessary to maintain high quality standards internally, and build up a solid quality culture for the company.

Keeping track of the market and working hard to achieve corporate goals

Looking ahead to 2021, in the face of the continued impact and shock of the pandemic and the rapidly evolving industry, it is reasonable to expect that the company's operations will continue to come across many challenges. There will always be challenges, and it depends on adequate preparations at ordinary times to be able to respond quickly to crises. Emergencies test the company's ability to take risks, and also reflect the health of the company. With the new year ahead, ScinoPharm will still overcome difficulties with a positive attitude. The management team of ScinoPharm will also be aligned on their goals and continue to lead all colleagues to take steady steps forward. We believe that with the efforts of our colleagues and the persistent support of the shareholders, we will continue to strengthen the foundation of stable operations, seize the opportunities from demands of the global pharmaceutical market and abide by industrial regulations and quality standards, to improve corporate profitability in order to reward the shareholders, customers and colleagues.

Chih-Hsien Lo, Chairman

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II. Company Profile

2.1 Date of Incorporation: Established date: November 11th 1997

2.2 Company History

• November 1997 ScinoPharm Taiwan, Ltd. was founded with paid-in capital of NT$675 million.

• May 1998 The Food and Drug Administration (FDA) of the U.S. screened the Company’s plant layout design and validation plan.

• July 1998 Started to rent a laboratory.

• October 1999 Relocated to the present site in Southern Taiwan Science Park, and started to use its own laboratory and office.

• Completed capital increment to NT$2.7 billion from NT$1.89 billion.

• January 2000 Inaugurated the first Kilo Lab.

• March 2000 Delivered the first batch of GMP (Good Manufacturing Practices) medicines to clients.

• April 2000 Establishment of the reinvested Xinjiang President-ScinoPharm Technology Co., Ltd.

• May 2000 Inaugurated the Pilot Plant.

• November 2000 Inaugurated the Mini Plant.

• January 2001 Delivered the first DMF (Drug Master File) raw medicine to the FDA for examination.

• February 2001 Establishment of the reinvested ScinoPharm (Kunshan) Biochemical Technology, Ltd.

• May 2001 The Customer submitted to the U.S.FDA abbreviated new drug application(ANDA) for the generic drug, the first one using the Company's active pharmaceutical ingredient(API) Establishment of the reinvested ScinoPharm Biotech Ltd.

• June 2001 Inaugurated the small manufacturing unit (SMU).

• October 2001 Passed U.S. FDA’s first comprehensive site inspection.

• November 2002 Inaugurated the Production Building.

• February 2003 Establishment of the reinvested Yunnan Ziyun Scino Bio-tech Co., Ltd.

• August 2005 Passed U.S. FDA’s second site inspection.

• January 2007 Establishment of the reinvested HanFeng Biopharmaceutical (Shanghai) Co., Ltd.

• May 2007 Completed expansion of production lines, including Kilo II and ESP II.

• October 2007 Passed the site inspection by the Therapeutic Goods Administration (TGA) of the Australian Government Department of Health.

• May 2008 Kicked off construction of the Quality Inspection Laboratory Building.

• June 2008 Acquired subsidiary ScinoPharm Biotech Ltd.

• June 2008 Passed the site inspection by the National Institute of Pharmacy

• (NIP) of Hungary, a member state of the European Union.

• June 2008 Passed the site inspection by Pharmaceuticals and Medical Devices Agency (PMDA) Japan.

• September 2008 Passed the site inspection by Korea Food and Drug Administration (KFDA).

~3~

• October 2008

• December 2008

• December 2008

• Passed U.S. FDA’s third site inspection.

• Inaugurated the Quality Inspection Laboratory Building.

• Business revenues broke the US$100 million mark.

• August 2009 Establishment of the reinvested ScinoPharm (Changshu)

• Pharmaceuticals, Ltd.

• June 2010 Liquidation of reinvestment in Xinjiang President-Scino Pharm Technology Co., Ltd.

• August 2010

• Signed an investment cooperation pact with Tanvex Biologics, Inc. and Ruentex Group to jointly develop Biosimilars.

• September 2010 Completed initial public offering of its shares in Taiwan.

• November 2010

• Obtained the Authorized Economic Operator (AEO) certificate from the Customs Administration under the Ministry of Finance as the first pharmaceuticals maker to do so.

• June 2011 Liquidation of reinvestment in HanFeng Biopharmaceutical (Shanghai) Co., Ltd.

• July 2011

• Inaugurated the second peptide plant.

• September 2011 Liquidation of reinvestment in Yunnan Ziyun Scino Bio-tech Co., Ltd.

• September 2011 Listing shares on the Taiwan Stock Exchange, with stock code 1789

• November 2011 Establishment of the reinvested ScinoPharm Shanghai Biochemical Technology, Ltd.

• August 2012 Passed U.S. FDA’s fourth site inspection.

• August 2012 Established an R&D team to venture into the development of injection medical preparations.

• December 2012 Production lines Bay4 and Bay 5 became operational.

• December 2012 ScinoPharm (Changshu) Pharmaceuticals, Ltd. won a production permit for pharmaceuticals.

• December 2012 Sent the first DMF of pharmaceuticals turned out by ScinoPharm (Changshu) Pharmaceuticals, Ltd. to the U.S. FDA for examination.

• August 2013 Passed the first EMA site inspection by European Medicine Agency.

• December 2013 Obtained the second AEO certificate from the Customs

• Administration of the Ministry of Finance.

• December 2013

• Plant of ScinoPharm (Changshu) Pharmaceuticals, Ltd. has been completed and inaugurated.

• July 2014 Won the A++ rating in the 11[th] assessment on information disclosure by listed companies, conducted by the Taiwan Securities Exchange Corp. (TWSE).

• August 2014

• Passed the second EMA site inspection.

• October 2014 Selected by the Institutional Investor, a leading financial monthly magazine in the world, as Taiwan’s only biotech company to rank among the most esteemed enterprises in Asia.

• March 2015 Passed the U.S. FDA’s fifth site inspection.

• April 2015 Won the A++ rating in the information disclosure assessment conducted by the TWSE on listed companies, for the second straight year.

• June 2015 Won the Outstanding Innovation Enterprise Award in the “People’s Well-being” Category of the 4[th] National Industrial Innovation Award hosted by the Ministry of Economic Affairs.

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 August 2015

• Ranked among the “Top 100 CSR Enterprises” in the “Excellence in Corporate Social Responsibility” Award hosted by the CommonWealth Magazine.

• October 2015 ScinoPharm (Changshu) Pharmaceuticals, Ltd. passed the U.S. FDA site inspection.

• June 2016 Won the A++ rating in the information disclosure assessment conducted by the TWSE on listed companies, for the second straight year.

• July 2016 Awarded 2016 Taiwan API Manufacturing Company of the Year by Frost & Sullivan

• October 2016 Passed the first EDQM site inspection by European Directorate for the quality of Medicine.

• November 2016 Awarded for paradigm of healthy workplace by Southern Taiwan Science Park Bureau

• December 2016 Obtained the third AEO certificate from the Customs Administration of the Ministry of Finance.

• February 2017

• Passed U.S. FDA’s Sixth site inspection.

• August 2017 Awarded in “Excellence in Corporate Social Responsibility” hosted by the Common Wealth Magazine.

• December 2017 Granted the honor of exporter/importer with good performance by the Bureau of Foreign Trade, the Ministry of Economic Affairs.

• December 2017 2nd place, the biotech industry category, best investmentrelationship service, greater China, IR Magazine.

• May 2018 Passed second-time factory inspection undertaken by Pharmaceuticals and Medical Devices Agency (PMDA) under the Japan government.

• May 2018 SciAnda (Changshu) Pharmaceuticals, Ltd. passed the first plant inspection by PMDA of Japan.

• May2018 Ranked among the top-5% of listed companies under Corporate Governance Evaluation.

• August 2018 Among the top-100 CSR (corporate social responsibility) awards selected by CommonWealth Magazine in 2018

• November 2018 Acquisitions of export permit for the U.S. for the self-developed anticoagulation medicine via ANDA procedure.

• May 2019 Passed U.S. FDA’s seventh site inspection.

• November 2019 Self-developed injectable formulation, developed in collaboration with Baxter as antiemetic medication for chemotherapy patients has been approved by the U.S. Food and Drug Administration (US FDA)

• December 2019 Granted enterprise with excellent performance in job parity at workplace for year 2019.

• August 2020 Merger of subsidiaries SciAnda (Changshu) Pharmaceuticals and SciAnda (Kunshan) Biotech Co., Ltd., with the former as the surviving company.

• September 2020 SciAnda (Changshu) Pharmaceuticals, Ltd. had the first registered plant inspection by NMPA and GMP applied site inspection in China.

• April 2021 Had cumulatively obtained 64 DMF from the US Food and Drug Administration and 872 DMFs (drug master files) globally as of April 2021.

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III. Corporate Governance Report

3.1 Organization

3.1.1 Organization Chart

==> picture [658 x 337] intentionally omitted <==

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3.1.2 Introduction to Organizational Functions

Division of Quality Management

• Quality guarantee, quality control, and quality auditing of active pharmaceutical ingredients (API) and preparations

Division of Research & Development

• R&D on process, technology, platform, and analysis of active pharmaceutical ingredients and preparations

Division of Marketing & Sales

• Marketing and customer service for products, talk on contracted R&D, strategic alliance, application for registration and technological support

Division of Operation

• Operational management, development of production technology, and planning for plant affairs of API plant premises

Division of Injectable Operation

• Production management and planning of plant affairs for ampoule preparations

Division of Finance

• Execution of financial affairs and accounting and investor relationship and communications

Division of Administration

• Human resources, information safety, general-affairs administration, procurement, public relations, and other business management

• Supreme unit chief serves as corporate spokesperson

Department of Environment, Health and Safety

• Industrial safety, occupational hygiene, environmental protection, and risk management

Audit Office

• Supervising internal risk control and conducting independent evaluation on observation of management regulations.

~7~

3.2 Information on Directors and Management Team

3.2.1 Directors

3.2.1.1 Information Regarding Directors As of 2020.12.31

Title	Nationality	Name	Gender	Date Elected	Term (Years)	Date First Elected (Note 2)	Shareholding when Elected	Shareholding when Elected	Current Shareholding (Note 1)	Current Shareholding (Note 1)	Spouse & Minor Shareholding	Spouse & Minor Shareholding	Shareholding by Nominee Arrangement	Shareholding by Nominee Arrangement	Experience（Education） (Note 3)	Other Position	Executives, Directors or Supervisors who are spouses or within two degrees of kinship	Executives, Directors or Supervisors who are spouses or within two degrees of kinship	Executives, Directors or Supervisors who are spouses or within two degrees of kinship	Remark (Note 4)
							Shares	％	Shares	％	Shares	％	Shares	％			Title	Name	Relation
Director (Institutional Shareholder)	Tainan City	Uni-President Enterprises Corp.	-	2018.06.27	3	1997.10.16	299,968,639	37.94%	299,968,639	37.94%	-	-	-	-	-	-	-	-	-
Chairman (Representative)	R.O.C.	Chih-Hsien Lo (Note 5)	M	2018.06.27	3	2010.07.06	-	-	-	-	-	-	-	-	Education: MBA, U.C.L.A, U.S.A. Experience: Executive Vice President and President of Uni-President Enterprises. Corp.	(Note 11)	director	Shiow- Ling Kao	spouse
Director (Representative)	R.O.C.	Tsung-Ming Su (Note 5)	M	2018.06.27	3	2010.07.06	-	-	-	-	-	-	-	-	Education: MBA, Iowa State Univ., U.S.A. Experience: CFO of Uni-President Enterprises Corp.	(Note 11)	-	-	-
Director (Representative)	R.O.C.	Kun-Shun Tsai (Note 5)	M	2018.06.27	3	2015.06.23	4,678	0.00%	4,678	0.00%	-	-	-	-	Education: Master of Science, University of Minnesota, U.S.A. Experience: Director, Uni-President Natural Corp., Director, Taiwan Association for Lactic Acid Bacteria, Supervisor, Association of Taiwan Tea, Member, Technical Committee of Natural Standards, Bureau of Standards, Metrology & Inspection, MOEA, R.O.C., Commissioner of the Review Committee, Academic Technology Development Program, MOEA, R.O.C., Director, Taiwan Association for Food Science and Technology	(Note 11)	-	-	-
Director (Representative)	R.O.C.	Tsung-Pin Wu (Note 5	M	2018.06.27	3	2015.06.23	-	-	-	-	-	-	-	-	Education: Accounting, Chung Yuan Christian University Experience: Financial Planning Division Manager (Accounting Supervisor), Uni-President Enterprises Corp.	(Note 11)	-	-	-

~8~

Title	Nationality	Name	Gender	Date Elected	Term (Years)	Date First Elected	Shareholding when Elected	Shareholding when Elected	Current Shareholding (Note 1)	Current Shareholding (Note 1)	Spouse & Minor Shareholding	Spouse & Minor Shareholding	Shareholding by Nominee Arrangement	Shareholding by Nominee Arrangement	Experience（Education）	Other Position	Executives, Directors or Supervisors who are spouses or within two degrees of kinship	Executives, Directors or Supervisors who are spouses or within two degrees of kinship	Executives, Directors or Supervisors who are spouses or within two degrees of kinship	Remark (Note 4)
							Shares	％	Shares	％	Shares	％	Shares	％			Title	Name	Relation
Director (Representative)	R.O.C.	Jia-Horng Guo (Note 5)	M	2018.06.27	3	2017.08.18	-	-	-	-	-	-	-	-	Education: Master of Finance, University of Illinois, Master of Business Administration, University of Minnesota, BS, National Taiwan University. Experience: Managing Director & head of UBS Investment Banking, Taiwan, Executive Director of Citigroup Investment Bank, Taiwan、Director of ING Barings Investment Bank、 Director of Citi Investment Bank(HK).、Director of Taishin Securities Co., Ltd.	(Note 11)	-	-	-
Director (Representative)	R.O.C.	Fu-Jung Lai (Note 5)	M	2018.10.29	3	2018.10.29	-	-	-	-	-	-	-	-	Education: MBA, Kun Shan Univ., R.O.C. Experience: Chief Secretary of President office of Uni-President Enterprises Corp. Manager of the Secretariat to the Board of Directors of Uni-President Enterprises Corp., Director of Uni-President Social Welfare Charity Foundation	(Note 11)	-	-	-
Director (Institutional Shareholder)	Tainan City	Kao Chyuan Inv. Co., Ltd.	-	2018.06.27	3	2002.06.13	14,832,733	1.88%	14,832,733	1.88%	-	-	-	-	-	-	-	-	-
Director (Representative)	R.O.C.	Shiow-Ling Kao (Note 6)	F	2018.06.27	3	2010.07.05	-	-	-	-	-	-	-	-	Education: Marymount College, University of Southern California Experience: Chairman of Kao Chyuan Inv. Co., Ltd.	(Note 11)	Chair- man	Chih- Hsien Lo	spouse
Director Institutional Shareholder	Tainan City .	Tainan Spinning Co., Ltd.	-	2018.06.27	3	1997.10.16	23,605,921	2.99%	23,605,921	2.99%	-	-	-	-	-	-	-	-	-
Director (Representative)	R.O.C.	Po-Ming Hou (Note 7)	M	2018.06.27	3	2016.11.10	-	-	-	-	-	-	-	-	Education: Department of Tourism Management, Chinese Culture Univ., R.O.C Experience: Chairman and President of Tainan Spinning Co., Ltd.	(Note 11)	-	-	-

~9~

Title	Nationality	Name	Gender	Date Elected	Term (Years)	Date First Elected	Shareholding when Elected	Shareholding when Elected	Current Shareholding (Note 1)	Current Shareholding (Note 1)	Spouse & Minor Shareholding	Spouse & Minor Shareholding	Shareholding by Nominee Arrangement	Shareholding by Nominee Arrangement	Experience（Education）	Other Position	Executives, Directors or Supervisors who are spouses or within two degrees of kinship	Executives, Directors or Supervisors who are spouses or within two degrees of kinship	Executives, Directors or Supervisors who are spouses or within two degrees of kinship	Remark (Note 4)
							Shares	％	Shares	％	Shares	％	Shares	％			Title	Name	Relation
Director (Institutional Shareholder)	Taipei City	President International Development Corp.	-	2018.06.27	3	2010.07.06	28,673,421	3.63%	28,673,421	3.63%	-	-	-	-	-	-	-	-	-
Director (Representative)	R.O.C.	Chiou-Ru Shih (Note 8)	F	2018.06.27	3	2010.07.06	-	-	-	-	-	-	-	-	Education: MA in Economics, University of Hawaii Experience: Vice General Manager, President International Development Corp., Director, President Biosystems Co., Ltd., Department Director, President Life Sciences Co., Ltd. Investment	(Note 11)	-	-	-
Director (Institutional Shareholder)	Taipei City	National Development Fund, Executive Yuan	-	2018.06.27	3	1997.10.16	109,539,014	15.85%	109,539,014	13.85%	-	-	-	-	-	-	-	-	-
Director (Representative)	R.O.C.	Ming-Chuan Hsieh (Note 9)	F	2018.06.27	3	2018.06.27	-	-	-	-	-	-	-	-	Education: Master of Health Services Administration, China Medical University Experience: Executive supervisor, Taiwan Health & Wellness Counseling Association	(Note 11)	-	-	-
Director (Representative)	R.O.C.	Ya-Po Yang (Note 9)	M	2018.06.27	3	2018.06.27	-	-	-	-	-	-	-	-		(Note 11)	-	-	-
															Education;
															Ph.D. in Economics, Department of
															Economics National Taiwan
															University
															Experience:
															Professor and Chairperson of
															Institute of International Business,
															College of Business, Southern
															Taiwan University of Science and
															Technology
Director (Institutional Shareholder)	Tainan City.	Taiwan Sugar Corporation	-	2018.06.27	3	2012.06.13	32,581,963	4.12%	32,581,963	4.12%	-	-	-	-	-	-	-	-	-

~10~

Title	Nationality	Name	Gender	Date Elected	Term (Years)	Date First Elected	Shareholding when Elected	Shareholding when Elected	Current Shareholding (Note 1)	Current Shareholding (Note 1)	Spouse & Minor Shareholding	Spouse & Minor Shareholding	Shareholding by Nominee Arrangement	Shareholding by Nominee Arrangement	Experience（Education）	Other Position	Executives, Directors or Supervisors who are spouses or within two degrees of kinship	Executives, Directors or Supervisors who are spouses or within two degrees of kinship	Executives, Directors or Supervisors who are spouses or within two degrees of kinship	Remark (Note 4)
							Shares	％	Shares	％	Shares	％	Shares	％			Title	Name	Relation
Director (Representative)	R.O.C.	Kuo-Hsi Wang (Note 10)	M	2018.06.27	3	2016.01.11	-	-	-	-	-	-	-	-	Education: Ph.D in Agricultural, Department of Agricultura Chemistry, National Taiwan University Experience: Taiwan Sugar Corporation Chief, Deputy Chief, Executive Officer, Institute Chair,Vice President	(Note 11)	-	-	-
Independent Director	R.O.C.	Wei-Te Ho	M	2018.06.27	3	2012.06.13	-	-	-	-	-	-	-	-	Education: Ph.D, Department of Accountancy, National Cheng Kung University Experience: Deputy Section Chief, Audit Department, Diwan, Ernst & Young (now Ernst & Young), Full-Time Lecturer, Department of Accounting Information, Southern Taiwan University of Science and Technology	(Note 11)	-	-	-
Independent Director	R.O.C.	Wen-Chang Chang	M	2018.06.27	3	2018.06.27	-	-	-	-	-	-	-	-	Education: Ph.D. Physiological Chemistry, University of Tokyo, Faculty of Pharmaceutical Sciences, Tokyo, Japan Experience: 1. Vice Chairman, Institute for Biotechnology and Medicine Industry 2. Deputy Minister, National Science Council、General Director, Department of Life Sciences, National Science Council, Taiwan 3. National Cheng Kung University, Tainan, Taiwan : Professor, Department of Pharmacology, College of Medicine、Chairman, Department of Pharmacology, National Cheng Kung University、 Chairman, Institute of Basic Medical Sciences, National Cheng Kung University、Associate Dean, College of Medical、University Chair Professor、Director, Center for Biosciences and Biotechnology、Dean, College of Bioscience and Biotechnology、 Distinguished Chair Professor、 Emeritus Distinguished Chair Professor	(Note 11)	-	-	-

~11~

Title	Nationality	Name	Gender	Date Elected	Term (Years)	Date First Elected	Shareholding when Elected	Shareholding when Elected	Current Shareholding (Note 1)	Current Shareholding (Note 1)	Spouse & Minor Shareholding	Spouse & Minor Shareholding	Shareholding by Nominee Arrangement	Shareholding by Nominee Arrangement	Experience（Education）	Other Position	Executives, Directors or Supervisors who are spouses or within two degrees of kinship	Executives, Directors or Supervisors who are spouses or within two degrees of kinship	Executives, Directors or Supervisors who are spouses or within two degrees of kinship	Remark (Note 4)
							Shares	％	Shares	％	Shares	％	Shares	％			Title	Name	Relation
Independent Director	R.O.C.	Li-Tzong Chen	M	2018.06.27	3	2018.06.27	-	-	-	-	-	-	-	-	Education: Ph.D, Kaohsiung Medical University Graduate Institute of Clinical Medicine Experience: 1. Research Vice Superintendent, Kaohsiung Medical University Chung-Ho Memorial Hospital 2. Director, Cancer Center of Kaohsiung Medical University Chung-Ho Memorial Hospital 3. Acting Board Director of Taiwan Oncology Society 4. Acting Supervisor of The Gastroenterological Society of Taiwan 5. Deputy Chair of National Institute of Cancer Research, National Health Research Institutes 6. Adjunct Professor, College of Medical Science and Technology, Taipei Medical University 7. Acting Director of Taiwan Pancreas Society 8. R&D consultant of Pharma Engine Inc.	(Note 11)	-	-	-

Note 1: Amount of shares held and Percentage of shared held as of 2021.05.01

Note 2: Disruption for first term as the company's director: None

Note 3: If the Company's Directors have held any position in the Chartered Accounting firm or its affiliates: None

Note 4: Where the Chairman of the Board of Directors and the President or person of an equivalent post (the highest level manager) of a company are the same person, spouses, or relatives within the first degree of kinship ： None

Note 5: Uni-President Enterprises Corp. Representative

Note 6: Kao Chyuan Inv. Co., Ltd. Representative

Note 7: Tainan Spinning Co., Ltd. Representative

Note 8: President International Development Corp. Representative Note 9: National Development Fund, Executive Yuan Representative Note 10: Taiwan Sugar Corporation Representative

Note 11: Current position with other company, please refer to next page.

~12~

Note 11 ： Current position with other company

	Note 11：Current position with other company
Name	Current Position with Other Company
Chih-Hsien Lo	Chairman of： Uni-President Enterprises Corp., President Natural Industrial Corp., Ton Yi Industrial Corp., Ttet Union Corp., Prince Housing & Development Corp., President Packaging Industrial Corp., Woongjin Foods Co., Ltd., Daeyoung Foods Co., Ltd., President International Development Corp., Uni-President China Holdings Ltd., Changjiagang President Nisshin Food Co., Ltd., ScinoPharm Taiwan, Ltd., Uni-President (Philippines) Corp., Uni-President (Thailand) Ltd., Uni-President (Vietnam) Co., Ltd., Uni-President Enterprises (China) Investment Co., Ltd., President Chain Store Corp., Uni-President Cold-Chain Corp., Presco Netmarketing, Inc., Uni-President Dream Parks Co., President Century Corp., President Property Corp., Nanlien International Corp., Cheng-Shi Investment Holding Co., Prince Real Estate Co., Times Square International Holding Co., Times Square International Hotel Co., Times Square International Stays Co., Uni-President Express Corp. Vice Chairman of：President Nisshin Corp. Director of： Presicarre Corp., Uni-Wonder Corp., Uni-President Organics Corp., Uni-President Glass Industrial Co., Ltd., Cayman President Holdings Ltd., Kai Yu (BVI) Investment Co., Ltd., President Fair Development Corp., Uni-President Southeast Asia Holdings Ltd., Uni-President Asia Holdings Ltd., Uni-President Hong Kong Holdings Ltd., Champ Green Capital Co., Ltd., Champ Green (Shanghai) Consulting Co., Ltd., Uni-President Enterprises (Guangzhou) Co., Ltd., Uni-President Enterprises (Fuzhou) Co., Ltd., Uni-President Enterprises (Xinjiang) Food Co., Ltd., Uni-President Enterprises (Wuhan) Food Co., Ltd., Uni-President Enterprises (Kunshan) Food Co., Ltd., Uni-President Enterprises (Chengdu) Food Co., Ltd.、Uni-President Enterprises (Shenyang) Co., Ltd., Uni- President Enterprises (Harbin) Co., Ltd., Uni-President Enterprises (Hefei) Co., Ltd., Uni-President Enterprises (Zhengzhou) Co., Ltd., Uni-President Enterprises (Beijing) Drink Co., Ltd., Uni- President Enterprises (Kunshan) Food Technology Co., Ltd., Uni-President Enterprises (Nanchang) Co., Ltd., Uni-President (Shanghai) Trading Co., Ltd., Uni-President Enterprises (Kunming) Food Co., Ltd., Uni-Yantai Tongli Beverage Industries Co., Ltd., Uni-President Enterprises (Changsha) Co., Ltd., Uni-President (Bama) Mineral Water Co., Ltd., Uni-President Enterprises (Nanning) Co., Ltd., Uni-President Enterprises (Zhanjiang) Co., Ltd., Uni-President Enterprises (Chongqing) Co., Ltd.、Uni-President Enterprises (Taizhou) Co., Ltd., Uni-President Enterprises (Akesu) Co., Ltd., Uni-President Enterprises (Changchun) Co., Ltd., Uni-President (Shanghai) Pearly Century Co., Ltd.、Uni-President Enterprises (Baiyin) Co., Ltd., Hainan President Enterprises Co., Ltd., Uni-President Enterprises (Guiyang) Co., Ltd., Uni-President Enterprises (Jinan) Co., Ltd., Uni-President Enterprises (Hangzhou) Co., Ltd., Uni-President Enterprises (Wuxue) Mineral Water Co., Ltd., Shijiazhuang President Enterprises Co., Ltd.、Uni-President Enterprises (Xuzhou) Co., Ltd.、Uni-President Enterprises (Henan) Co., Ltd., Uni-President Trading (Kunshan) Co., Ltd., Uni-President Enterprises (Shaanxi) Co., Ltd., Uni-President Enterprises (Jiangsu) Co., Ltd., Uni-President Enterprises (Changbai Mountain Jilin) Mineral Water Co., Ltd., Uni-President Enterprises (Ningxia) Co., Ltd., Uni-President Enterprises (Shanghai) Co., Ltd., Uni- President Enterprises (Inner Mongolia) Co., Ltd., Uni-President Enterprises (Shanxi) Co., Ltd., Uni- President Enterprise (Hutubi) Tomato Products Technology Co., Ltd., Uni-President Enterprises (Shanghai) Drink & Food Co., Ltd., Uni-President Enterprises (Tianjin) Co., Ltd., Uni-President Enterprises (Hunan) Co., Ltd., Uni-Oao Travel Service Corp., President Packaging Holdings Ltd., Kuang Chuan Dairy Co., Ltd., Kuang Chuan Foods Ltd., President Energy Development (Cayman Islands) Ltd., Uni-President Development Corp., President Professional Baseball Team Corp., Tait Marketing & Distribution Co., Ltd., Wei Lih Food Industrial Co., Ltd., Keng Ting Enterprises Co., Ltd., President Chain Store (BVI) Holdings Ltd., President Chain Store (Labuan) Holdings Ltd., Rsi, Retail Support International Corp., Prince Property Management Consulting Co., Uni-President Assets Holdings Ltd., Kao Chuan Inv. Co., Ltd. Supervisor of： Infinity Holdings Ltd., Eternity Holdings Ltd. President of：Presco Netmarketing Inc.,Uni-President Express Corp.
Tsung-Ming Su	Chairman of： President Life Sciences Co., Ltd., Tong Yu Investment Corp., Uni-President Development Corp., AndroSciences Corp. Director of： President Chain Store Corp., ScinoPharm Taiwan, Ltd., Grand Bills Finance Corp., President International Development Corp., Uni-President China Holdings Ltd., President Tokyo Corp., Uni- President Hong Kong Holdings Limited、President (BVI) International Investment Holdings Ltd., President Energy Development (Cayman Islands) Ltd.、President Life Sciences Cayman Co., Ltd., SPT International, Ltd.、President Tokyo Auto Leasing Corp., Tong-Sheng Finance Leasing Co., Ltd., Tong- Sheng (Suzhou) Car Rental Co., Ltd., Tanvex Biologics, Inc., Cdib & Partners Investment Holding Corp., Xiang Lu Industrial Ltd. Supervisor of： Presicarre Corp., Uni-President Enterprises (China) Investment Co., Ltd., Presco Netmarketing, Inc., President of： ScinoPharm Taiwan, Ltd., President International Development Corp., President PropertyCorp.

Chairman of ： Uni-President Enterprises Corp., President Natural Industrial Corp., Ton Yi Industrial Corp., Ttet Union Corp., Prince Housing & Development Corp., President Packaging Industrial Corp., Woongjin Foods Co., Ltd., Daeyoung Foods Co., Ltd., President International Development Corp., Uni-President China Holdings Ltd., Changjiagang President Nisshin Food Co., Ltd., ScinoPharm Taiwan, Ltd., Uni-President (Philippines) Corp., Uni-President (Thailand) Ltd., Uni-President (Vietnam) Co., Ltd., Uni-President Enterprises (China) Investment Co., Ltd., President Chain Store Corp., Uni-President Cold-Chain Corp., Presco Netmarketing, Inc., Uni-President Dream Parks Co., President Century Corp., President Property Corp., Nanlien International Corp., Cheng-Shi Investment Holding Co., Prince Real Estate Co., Times Square International Holding Co., Times Square International Hotel Co., Times Square International Stays Co., Uni-President Express Corp. Vice Chairman of ： President Nisshin Corp. Director of ： Presicarre Corp., Uni-Wonder Corp., Uni-President Organics Corp., Uni-President Glass Industrial Co., Ltd., Cayman President Holdings Ltd., Kai Yu (BVI) Investment Co., Ltd., President Fair Development Corp., Uni-President Southeast Asia Holdings Ltd., Uni-President Asia Holdings Ltd., Uni-President Hong Kong Holdings Ltd., Champ Green Capital Co., Ltd., Champ Green (Shanghai) Consulting Co., Ltd., Uni-President Enterprises (Guangzhou) Co., Ltd., Uni-President Enterprises (Fuzhou) Co., Ltd., Uni-President Enterprises (Xinjiang) Food Co., Ltd., Uni-President Enterprises (Wuhan) Food Co., Ltd., Uni-President Enterprises (Kunshan) Food Co., Ltd., Uni-President 、 Enterprises (Chengdu) Food Co., Ltd. Uni-President Enterprises (Shenyang) Co., Ltd., UniPresident Enterprises (Harbin) Co., Ltd., Uni-President Enterprises (Hefei) Co., Ltd., Uni-President Enterprises (Zhengzhou) Co., Ltd., Uni-President Enterprises (Beijing) Drink Co., Ltd., UniPresident Enterprises (Kunshan) Food Technology Co., Ltd., Uni-President Enterprises (Nanchang) Co., Ltd., Uni-President (Shanghai) Trading Co., Ltd., Uni-President Enterprises (Kunming) Food Co., Ltd., Uni-Yantai Tongli Beverage Industries Co., Ltd., Uni-President Enterprises (Changsha) Co., Ltd., Uni-President (Bama) Mineral Water Co., Ltd., Uni-President Enterprises (Nanning) Co., Ltd., Uni-President Enterprises (Zhanjiang) Co., Ltd., Uni-President 、 Enterprises (Chongqing) Co., Ltd. Uni-President Enterprises (Taizhou) Co., Ltd., Uni-President Enterprises (Akesu) Co., Ltd., Uni-President Enterprises (Changchun) Co., Ltd., Uni-President 、 (Shanghai) Pearly Century Co., Ltd. Uni-President Enterprises (Baiyin) Co., Ltd., Hainan President Enterprises Co., Ltd., Uni-President Enterprises (Guiyang) Co., Ltd., Uni-President Enterprises (Jinan) Co., Ltd., Uni-President Enterprises (Hangzhou) Co., Ltd., Uni-President Enterprises (Wuxue) Mineral Water Co., Ltd., Shijiazhuang President Enterprises Co., Ltd. 、 Uni-President 、 Enterprises (Xuzhou) Co., Ltd. Uni-President Enterprises (Henan) Co., Ltd., Uni-President Trading (Kunshan) Co., Ltd., Uni-President Enterprises (Shaanxi) Co., Ltd., Uni-President Enterprises (Jiangsu) Co., Ltd., Uni-President Enterprises (Changbai Mountain Jilin) Mineral Water Co., Ltd., Uni-President Enterprises (Ningxia) Co., Ltd., Uni-President Enterprises (Shanghai) Co., Ltd., UniPresident Enterprises (Inner Mongolia) Co., Ltd., Uni-President Enterprises (Shanxi) Co., Ltd., UniPresident Enterprise (Hutubi) Tomato Products Technology Co., Ltd., Uni-President Enterprises (Shanghai) Drink & Food Co., Ltd., Uni-President Enterprises (Tianjin) Co., Ltd., Uni-President Enterprises (Hunan) Co., Ltd., Uni-Oao Travel Service Corp., President Packaging Holdings Ltd., Kuang Chuan Dairy Co., Ltd., Kuang Chuan Foods Ltd., President Energy Development (Cayman Islands) Ltd., Uni-President Development Corp., President Professional Baseball Team Corp., Tait Marketing & Distribution Co., Ltd., Wei Lih Food Industrial Co., Ltd., Keng Ting Enterprises Co., Ltd., President Chain Store (BVI) Holdings Ltd., President Chain Store (Labuan) Holdings Ltd., Rsi, Retail Support International Corp., Prince Property Management Consulting Co., Uni-President Assets Holdings Ltd., Kao Chuan Inv. Co., Ltd. Supervisor of ： Infinity Holdings Ltd., Eternity Holdings Ltd. President of ： Presco Netmarketing Inc., Uni-President Express Corp. Chairman of ： President Life Sciences Co., Ltd., Tong Yu Investment Corp., Uni-President Development Corp., AndroSciences Corp. Director of ： President Chain Store Corp., ScinoPharm Taiwan, Ltd., Grand Bills Finance Corp., President International Development Corp., Uni-President China Holdings Ltd., President Tokyo Corp., Uni- 、 President Hong Kong Holdings Limited President (BVI) International Investment Holdings Ltd., 、 President Energy Development (Cayman Islands) Ltd. President Life Sciences Cayman Co., Ltd., 、 SPT International, Ltd. President Tokyo Auto Leasing Corp., Tong-Sheng Finance Leasing Co., Ltd., Tong- Sheng (Suzhou) Car Rental Co., Ltd., Tanvex Biologics, Inc., Cdib & Partners Investment Holding Corp., Xiang Lu Industrial Ltd. Supervisor of ： Presicarre Corp., Uni-President Enterprises (China) Investment Co., Ltd., Presco Netmarketing, Inc., President of ： ScinoPharm Taiwan, Ltd., President International Development Corp., President Property Corp.

~13~

Name	Current Position with Other Company
Shiow-Ling Kao	Chairman of： Kao Chuan Inv. Co., Ltd., Infinity Holdings Ltd., Eternity Holdings Ltd., President Fair Development Corp., Uni-President Department Store Corp., President Being Corp., President Pharmaceutical Corp., President Drugstore Business Corp., Director of： Uni-President Enterprises Corp., Uni-Wonder Corp., Ton Yi Industrial Corp., Prince Housing & Development Corp., President International Development Corp., ScinoPharm Taiwan, Ltd., President Chain Store Corp., President Century Corp., Uni-President Development Corp., President (Shanghai) Health Product Trading Company Ltd., Beauty Wonder (Zhejiang) Trading Co., Ltd., Times Square International Holding Co., Times Square International Hotel Co. President of：Kao Chyuan Inv. Corp., President Fair Development Corp.
Tsung-Pin Wu	Chairman of： Tung –Ren Pharmaceutical Corp., Kai Nan Investment Co., Ltd. Director of： Prince Housing & Development Corp., President Fair Development Corp.、ScinoPharm Taiwan, Ltd. Uni-President (Vietnam) Co., Ltd., Uni-President Hong Kong Holdings Ltd., President Chain Store Corp., Kuang Chuan Dairy Co., Ltd., Kuang Chuan Foods Ltd., Tung Lo Development Co., Ltd., Tone Sang Construction Corp., Cheng-Shi Investment Holding Co., Prince Real Estate Co., Times Square International Holding Co., Times Square International Hotel Co. Supervisor of： President Kikkoman Inc., Woongjin Foods Co., Ltd., Daeyoung Foods Co., Ltd., Kunshan President Kikkoman Biotechnology Co., Ltd., President International Development Corp., President Kikkoman Zhenji Foods Co., Ltd., President Century Corp., President Professional Baseball Team Corp., Mean Time Enterprise Co., Ltd., Nanlien International Corp., Times Square International Stays Co.,Uni-President Express Corp.
Kun-Shun Tsai	Director of： ScinoPharm Taiwan, Ltd.
Fu-Jung Lai	Vice President of the President’s Office of Uni-President Enterprises Corp./ Corporate Governance Officer Director of： ScinoPharm Taiwan,Ltd.
Po-Ming Hou	Chairman of： Tainan Spinning Co., Ltd., Tainan Spinning Retail & Distribution Co., Ltd., Tainan Spinning Co., Ltd.(Vietnam), Nan-Fan International Investment(Cayman), Ltd. Tainan Textile Co., Ltd., Yu Peng Investment Co., Ltd., New Yupeng Investment Co., Ltd., Tainan Spinning Cultural and Educational Foundation. Director of： Nanfang Development Co., Ltd., Tainan Spinning Holdings (Cayman Islands) Co., Ltd., Prince Housing & Development Corp., Uni-President Enterprises Corp., President International Development Corp., ScinoPharm Taiwan, Ltd., Nantex Industry Co., Ltd., T. G. I. Co., Ltd., President Real Estate(U.S.) Investment Co, Nan Tai Royal Co., Ltd.
Jia-Horng Guo	Chairman of：Taishin Securities Co., Ltd. Director of：ScinoPharm Taiwan, Ltd. Supervisor：Standard Motor Corp., DynastyTechwood Corp.
Chiou-Ru Shih	Director of： ScinoPharm Taiwan, Ltd., SyNergy ScienTech Corp., Kunshan Synergy Scientech Co., Ltd., President Life Sciences Cayman Co., Ltd., Helios Bioelectronics Inc., Grand Bills Finance Corp., IMQ Technology Inc., Dabomb Protein Corp. Vice President of： President International Development Corp.
Ming-Chuan Hsieh	Director of：ScinoPharm Taiwan Ltd., Harbinger VI Venture Capital Corp., Harbinger VII Venture Capital Corp., Independent Director of：Uni Pharma Co., Ltd Supervisor of：Han Tong Investment Inc., Harbinger VIII Venture Capital Corp., Compensation Committee member of：PharmaEssentia
Ya-Po Yang	Professor of Institute of Business and Management, College of Management, National University of Kaohsiung Director of： ScinoPharm Taiwan, Ltd.
Kuo-Hsi Wang	Director of： ScinoPharm Taiwan, Ltd., United Biomedical Inc. (Asia), TaiGen biotechnology Co., Ltd President of： Taiwan Sugar Corporation

~14~

Name	Current Position with Other Company
Wei-Te Ho	Assistant Professor, Dept. of Accounting Information, Southern Taiwan University of Science and Technology, Independent Director, ScinoPharm Taiwan, Tainan SpinningCo.,
Li-Tzong Chen	Distinguished Investigator & Director, National Institute of Cancer Research, Chairman, President of Taiwan Oncology Society, Chair Professor, Internal Medicine, Kaohsiung Medical University, Emeritus Chair Professor of Institute of Biomedical Sciences, National Sun Yat-sen University, Adjunct Professor, Dept. Bio Science & Tech, National Yang Ming Chiao Tung University, Adjunct Attending Physician, Department of Internal Medicine, National Cheng-Kung University Hospital, Tainan, Professor, jointly appointed, Institute of Clinical Medicine, College of Medicine, NCKU, Professor, jointly appointed, Dept. of Internal Medicine, Clinical, Medicine, NCKU, Professor, jointly appointed, Institute of Molecular Medicine, NCKU, Professor, jointly appointed, Institute of Clinical Pharmacy and Pharmaceutical Sciences, NCKU, Independent Director, ScinoPharm Taiwan, Ltd.
Wen-Chang Chang	Chairman, Board of Trustees, of Graduate Institute of Medical Sciences, College of Medicine, Taipei Medical University, Chair Professor, Graduate InstituteofofMedical Sciences, College of Medicine, Taipei Medical University Emeritus Distinguished Chair, Professor of National Cheng Kung University Academician of Academia Sinica Compensation Committee member of Universal Cement Corporation Independent Director: ScinoPharm Taiwan, Ltd.

Table I List of Major Shareholders of ScinoPharm's Institutional Shareholders As of 2020.12.31

Table I List of Major Shareholde	rs of ScinoPharm's Institutional Shareholders As of 2020.12.31
ScinoPharm 's Institutional Shareholders	Major Shareholders of ScinoPharm 's Institutional Shareholders (HoldingPercentage)
National Development Fund, Executive Yuan	－
Uni-President Enterprises Corp.	Kao Chyuan Investment Co., Ltd. (4.93%), BNP Paribas’s Wealth Management HK. Branch(3.04%), Po-Ming Hou (2.60%), Po-Yu Hou (2.27%), Government of Singapore –GOS-EFMC (2.17%), Kathay Life Insurance Co., Ltd.(2.07), Kao Shiow-Ling (1.64%), J.P. Morgan Chase Bank N.A. Taipei Brach in custody for Saudi Arabian Monetary Agency (1.64%), The Overlook Partners Fund L.P.(1.49%), J.P. Morgan Chase Bank N.A.(1.34%), Vanguard Emerging Markets Stock Index Fund (1.43%)
Taiwan Sugar Corporation	Ministry of Economic Affairs (86.15%), Northern Region Branch of National Property Administration under the Ministry of Finance (9.92%), First Commercial Bank (0.75%), Changhwa Commercial Bank (0.41%), Bank of Taiwan (0.36%), Taiwan Business Bank (0.30%), Hua Nan Commercial Bank (0.14%), Central Investment Holding (0.14%), Mega Bank (0.13%), Land Bank of Taiwan (0.08%), and Taiwan Cooperative Bank (0.08%).
President International Development Corp.	Uni-President Enterprises Corp. (69.37%), Tainan Spinning Company (9.00%), Prince Housing & Development (6.63%), President Chain Store Corp. (3.33%), Kai Yu Investment Co., Ltd.(3.33%), Tainan Spinning Construction (3.00%), Kao Chuan Investment Corp. (1.87%), NANTEX Industry Co., Ltd. (0.67%), and Nanlien International Corp. (0.67%).
Tainan Spinning Co., Ltd.	Hou Po-yu (6.255%), Hou Po-ming (6.223%), Hou Po-yi (6.156%) , Hsin Yung Hsing Investment Co., Ltd. (4.639%), Hsin Fu Hsing Industrial Co., Ltd. (4.200%), Hou Chen Pi-hua (1.572%),Kung Wei Investment Co., Ltd.,(1.506%),Chuang Ying-chih (1.343%), Chuang Ying-nan (1.290%),. Hou Gi-Xing(1.090%)
Kao Chyuan Investment Co., Ltd	Infinity Holdings Ltd.(51.11%), Eternity Holdings Ltd.(48.89%)

Table II Key members of Main Corporate Shareholders Listed in Table I As of 2020.12.31

Table II Keymembers of Ma	in Corporate Shareholders Listed in Table IAs of 2020.12.31
Names of corporate bodies	Main shareholders of corporate bodies
Ministry of Economic Affairs	Government unit
Northern Region Branch, National Property Administration, Ministry of Finance	Government unit

~15~

Names of corporate bodies	Main shareholders of corporate bodies
First Commercial Bank	First Financial Holding (100%)
Changhwa Commercial Bank	Taishin Financial Holding (22.55%), Ministry of Finance (12.19%), Chunghwa Post Co., Ltd. (6.00%), First Commercial Bank (3.86%), Excel Chemical Corp. (2.85%), National Development Fund, Executive Yuan (2.75%), Taiwan Tobacco & Liquor Corp. (2.32%), Mega International Commercial Bank Co., Ltd., Head Office, Treasury Department (2.17%), Taiwan Cooperative Bank, Ltd.(1.45%), Hua Nan Commercial Bank,Ltd.(1.45%)
Bank of Taiwan	Taiwan Financial Holdings (100%)
Taiwan Business Bank	Bank of Taiwan (16.21%), National Development Fund, Executive Yuan (5.87%),Land Bank of Taiwan (2.29%), Ministry of Finance (2.08%), JPMorgan Chase Bank N.A. Taipei Branch in custody for Vanguard Total International Stock Index Fund a series of Vanguard Star Funds (1.22%), Norges Bank - internal - NBIM PF EQ INTERNAL CFD(0.91%), Vanguard Emerging Markets Stock Index Fund A Series of Vanguard International Equity Index Funds(0.90%), BES Engineering Corporation (0.87%), ISHARES MSCI TAIWAN ETF(0.63%), California Public Employees' Retirement System - Emerging Markets Small Cap Index Fund(0.59%)
Hua Nan Commercial Bank	Hua Nan Financial Holdings (100%)
Central Investment Holding	KMT (100%)
Mega Bank	Mega Holdings (100%).
Land Bank of Taiwan	Ministry of Finance (100%)
Infinity Holdings Ltd.	Shiow-ling Kao (55.91%), Chih-Hsien Lo (20.27%),Han-Di Kao (7.94%), Chi-Yi Kao (7.94%),Hsi-Ai Lo(7.94%)
Eternity Holdings Ltd.	Shiow-ling Kao(70.77%), Chih-Hsien Lo (21.18%),Han-Di Kao (3.36%),Chi-Yi Kao (2.45%),Hsi-Ai Lo (2.24%)
Prince Housing & Development Corp.	Uni-President Enterprises Corp. (10.03%), Tai Po Investment Co., Ltd. (5.93%), Tainan Spinning Construction (3.65%), Kao Chuan Investment (3.58%), Guang Wei Investment Co., Ltd. (2.84%), Tseng Chao-mei Wu (2.65%), Universal Cement Corp. (2.36%), Universal Cement Investment Corp. (2.02%), Hsin Yung Hsing Investment Co., Ltd. (1.63%), President International Development Corp., (1.58%)
President Chain Store Corp.	Uni-President Enterprises Corp. (45.40%), First State Investments ICVC - Stewart Investors Asia Pacific Leaders Fund(2.66%), PCSC Employees Benefits Trust account in the custody of CTBC Bank (2.12%), Labor Pension Fund (New Scheme) (1.47%), Labor Insurance Fund (1.41%), Cathay Life Insurance (1.41%),Matthews Pacific Tiger Fund (1.31%), Government of Singapore (1.11%), JPMorgan Chase Bank N.A.(0.93%),Citibank Hosting Norwegian Central Bank Investment Account(0.92%)
Tai Po Investment Co., Ltd.	Ping Chih Wu (20.84%), Ping Yuan Wu (20.84%), Chien Te Wu (18.95%), Wei Te Wu (18.95%), Tseng Chao-mei Wu(8.48), Cheng Ta Investment Co., Ltd. (1.41%), Su Mei Huang (8.88%), Chao-mei Wu Tseng (8.48%), Chuan Chuang Wu (0.31%), Shu Chen Wu (0.25%)
Tainan Spinning Construction Corp.	Tainan Spinning Co. (100.00%)
Kuang Wei Investment Co., Ltd.	Rui Xing International Investment Co., Ltd. (100%)
Universal Cement Corp.	Sheng Yuan Investment Co., Ltd.(9.98%), Yu Sheng Investment Co., Ltd(9.87%), Bo-yi Hou (7.78%), HSBC custodian Pictet investment accounts (6%), Bo Chih Investment Co., Ltd. (4.26%), Ching-Chieh Hou Su(3.41%), Lung I Chang Sand & Stone Co., Ltd. (3.18%), Standard Chartered custodian DBS Bank 0600049662 (3.09%), Bo-Yu Hou (2.61%), T.H. Wu Foundation(1.78%)
Universal Cement Investment Corp.	Universal Cement Corp.(100%)
Hsin Yung Hsing Investment Co., Ltd.	Po-Yu Hou(32.09%),Bo Yi Hou (31.1%),Po-Ming Hou (31.93%),Pi-hua Hou Chen(1.42%), Chin-chien Hou Su (0.93%),Chih-Sheng Hou (0.85%),Chih-Yuan Hou (0.85%),Chin-HuaHo(0.62%),HouHsing Overseas Company(0.21%)
Hsin Fu Hsing Investment Co., Ltd.	Bo-yi Hou (23.51%), Po-yu Hou (24.11%),Po-ming Hou (24.09%), Pi-hua Hou Chen (9.88%), Chin-Chien Hou Su (3.00%), Hou Hsing Overseas Company (0.10%), Hsin Yung Hsing Investment Co., Ltd. (14.68%), Chih-Sheng Hou (0.33%), Chih-Yuan Hou (0.30%),

~16~

3.2.1.2 Professional qualifications and independence analysis of directors and supervisors

As of 2021.04.30

						As	As	As	As	As	As	As	As	As	As	of 2021.04.30
Criteria Name	Meet One of the Following Professional Qualification Requirements, Together with at Least Five Years Work Experience					Independence Criteria(Note)										Number of Other Public Companies in Which the Individual is Concurrently Serving as an Independent Director
	An Instructor or Higher Position in a Department of Commerce, Law, Finance, Accounting, or Other Academic Department Related to the Business Needs of the Company in a Public or Private Junior College, College or University	A Judge, Public Prosecutor, Attorney, Certified Public Accountant, or Other Professional or Technical Specialist Who has Passed a National Examination and been Awarded a Certificate in a Profession Necessary for the Business of the Company	Have Work Experience in the Areas of Commerce, Law, Finance, or Accounting, or Otherwise Necessary for the Business of the Company	1	2	3	4	5	6	7	8	9	10	11	12
Uni-President Enterprises Representative: Chih-Hsien Lo																0
Uni-President Enterprises Representative: Tsung-Ming Su																0
Uni-President Enterprises Representative: Kun-Shun Tsai																0
Uni-President Enterprises Representative: Tsung-Pin Wu																0
Uni-President Enterprises Representative: Jia Horng Guo																0
Uni-President Enterprises Representative: Fu-Jung Lai																0
Kao Chyuan Inv. Co., Ltd. Representative: Shiow-Ling Kao																0
Tainan Spinning Co., Ltd. Representative: Po-Ming Hou																0
President International Development Corp. Representative: Chiou-Ru Shih																0
National Development Fund, Executive Yuan Representative: Ming-Chuan Hsieh																1
National Development Fund, Executive Yuan Representative: Ya-PoYang																0
Taiwan Sugar Corporation Representative: Kuo-Hsi Wang																0
Wei-Te Ho																1
Wen-Chang Chang																0
Li-Tzong Chen																0

~17~

Note: Please tick the corresponding boxes that apply to the directors or supervisors during the two years prior to being elected or during the term of office.

• 1: Not an employee of the Company or any of its affiliates

• 2: Not a director or supervisor of the Company or any of its affiliates. Not apply to independent director of the Company, the Company’s parent company or any subsidiary of the Company)

• 3: Not a shareholder whose total holdings, including those of his/her spouse and minor children, or shares held under others’ names, reach or exceed 1 percent of the total outstanding shares of the Company or rank among the top 10 individual shareholders

• 4: Not a spouse, relative of second degree or closer, or direct blood relative of third degree or closer to the managers listed in (1) and persons listed in (2) or (3).

• 5: Not a director, supervisor, or employee of a corporate shareholder that directly holds more than 5% of the total issued shares of the Company, a top-five shareholder, or authorized representative to be a director or supervisor of the Company in accordance with Article 27, Paragraph 1 or 2 of the Company Act (however, this does not apply when serving concurrently and mutually as independent director established by the Company and its parent company, subsidiary, or subsidiary of the same parent company in accordance with provisions hereof or local laws and regulations).

• 6: Not a director, supervisor, or employee of another company where more than half of the director positions or voting shares of that other company and the Company are controlled by the same person (however, this does not apply when serving concurrently and mutually as independent director established by the Company or its parent company, subsidiary, or subsidiary of the same parent company in accordance with provisions hereof or local laws and regulations).

• 7: Not a director (managing director), supervisor (managing supervisor) or employee of another company or institution where any of its chairmen, presidents, or other equivalent positions are served by the same person or is the spouse of the Company’s chairmen, presidents, or other equivalent positions (however, this does not apply when serving concurrently and mutually as independent director established by the Company and its parent company, subsidiary, or subsidiary of the same parent company in accordance with provisions hereof or local laws and regulations).

• 8: Not a director (managing director), supervisor (managing supervisor), manager, or shareholder with 5% or more shareholding of a specific company or institution with which the Company has financial or business dealings (however, this does not apply when serving concurrently and mutually as independent director established by the Company and its parent company, subsidiary, or subsidiary of the same parent company in accordance with provisions hereof or local laws and regulations, if that specific company or institution holds no less than 20%, but no more than 50%, of the total issued shares of the Company).

• 9: Not a professional who provides auditing to the Company or its affiliates, or a professional who provides commercial, legal, financial, accounting, or related services to the Company or its affiliates with a total remuneration of less than NT$500,000 in the past two years, nor is an owner, partner, director (managing director), supervisor (managing supervisor), or manager, or the spouse of any of the above, of a sole proprietorship, partnership, company, or organization that provides such services to the Company or its affiliates. However, this does not apply to members of the Compensation Committee, Public Tender Offer Review Committee or Special Committee for Merger/Consolidation and Acquisition who perform their functions in accordance with laws relevant to the Securities and Exchange Act or the Business Mergers And Acquisitions Act.

• 10: Not a spouse or relative within second degree by affinity to other directors

• 11: Not in contravention of Article 30 of the Company Act

• 12: Not an institutional shareholder or its representative pursuant to Article 27 of the Company Act

~18~

3.2.2 Information of Management Team

							As of 2020.12.31 Unit：Shares；%	As of 2020.12.31 Unit：Shares；%	As of 2020.12.31 Unit：Shares；%	As of 2020.12.31 Unit：Shares；%	As of 2020.12.31 Unit：Shares；%	As of 2020.12.31 Unit：Shares；%	As of 2020.12.31 Unit：Shares；%	As of 2020.12.31 Unit：Shares；%	As of 2020.12.31 Unit：Shares；%	As of 2020.12.31 Unit：Shares；%
Title	Nationality	Name	Gender	Date Effective	Shareholding (Note1)		Spouse & Minor Shareholding		Shareholding by Nominee Arrangement		Experience (Education)	Other Position	Managers who are Spouses or Within Two Degrees of Kinship			Remark (Note 2)
					Shares	％	Shares	％	Shares	％			Title	Name	Relation
General Chief Strategy Officer	R.O.C.	Chih-Hsien Lo	M	2017.08.18	-	-	-	-	-	-	Education: MBA U.C.LA, U.S.A. Experience: Executive Vice President, President of Uni-President Enterprises. Corp.	Chairman of： Uni-President Enterprises Corp. President Chain Store Corp. Ton Yi Industrial Corp, TTET Union Corp., Prince Housing & development Corp., Uni-President China Holdings Ltd.，President Enterprises (China) Investment Co., Ltd. (Please refer to Page 13 for more details)	-	-	-	-
President & CEO	R.O.C.	Tsung-Ming Su	M	2018.07.05	-	-	-	-	-	-	Education: MBA, Iowa State Univ., U.S.A. Work Experience: CFO of Uni-President Enterprises Corp., President Life Sciences Co., Ltd.,	Chairman of: President Life Sciences Co., Ltd., Uni-President Development Corp., AndroSciences Corp. Tung Yu Investment Co. (Please refer to Page 13 for more details)	-	-	-	-
Vice-President Marketing and Sales & Strategic Officer	R.O.C.	Ching-Wen Lin	F	2010.06.01	106,619	0.013%	33,512	0.004%	-	-	Education: Ph. D in Chemistry at The Hong Kong Polytechnic University. Work Experience: Researcher, senior marketing manager and marketing director at ScinoPharm..	President and Director of: SciAnda Shanghai Biochemical Technology, Ltd. Director of: SciAnda(Changshu) Pharmaceuticals, Ltd., ScinoPharm Singapore Pte Ltd., Medical and Pharmaceutical Industry Technology and Development Center Director、Supervisor of: Taiwan Generic Pharmaceutical Association	-	-	-	-
Vice President Quality Management	R.O.C.	Katy Cheng	F	2019.03.25	-	-	-	-	-	-	Education: Kaohsiung Medical University Pharmacy, National Chiao Tung University MBA Master Experience: Alvogen Quality VP, Pfizer INJ Plant Manager, Pfizer QO Director, Synmorsa Plant Manager, J&J QA Manager, Norvatis Quality Manager	NA	-	-	-	-

~19~

Title	Nationality	Name	Gender	Date Effective	Shareholding (Note1)	Shareholding (Note1)	Spouse & Minor Shareholding	Spouse & Minor Shareholding	Shareholding by Nominee Arrangement	Shareholding by Nominee Arrangement	Experience (Education)	Other Position	Managers who are Spouses or Within Two Degrees of Kinship	Managers who are Spouses or Within Two Degrees of Kinship	Managers who are Spouses or Within Two Degrees of Kinship	Remark (Note 2)
					Shares	％	Shares	％	Shares	％			Title	Name	Relation
Vice President Administration	R.O.C.	Li-An (Susan) Lu	F	2018.08.01	-	-	-	-	-	-	Education: University of Business Administration/Institute Financial Management, National Sun Yat-Sen University Work Experience: Vice President of IBT Securities Co. Ltd., Assistant Manager of Taiwan International Securities Corporation, Division Head of Treasury Division, Uni-President Enterprises Corp., Director of President Transnet Corp., and President Collect Service Corp, Supervisor of Tong Kuan Enterprise Co., Ltd.,	Director of: President Securities Corp., president Transnet Corp. Supervisor of: Tong Kuan Enterprise Co., Ltd.	-	-	-	-
Vice President of Injectable Business Division & CSO	R.O.C.	Li-Chiao Chang	F	2007.11.19	8	0.000%	-	-	-	-	Education: Ph. D in Chemistry, National Taiwan University Work Experience: Senior researcher, quality control director, senior analysis and research manager, senior director of pharmaceutical preparation & peptide products development at ScinoPharm.	Director of: SciAnda(Changshu) Pharmaceuticals, Ltd.、 SciAnda Shanghai Biochemical Technology, Ltd.	-	-	-	-
Vice President Operations	R.O.C.	Ling-Hsiao Lien (Note 3)	M	2011.01.03	-	-	-	-	-	-	Education: Bachelor & Master in Chemical Engineering, National Cheng Kung University Work Experience: Researcher, Kao (Taiwan) Corp.; quality assurance engineer at ASE Group; researcher, production procedure research manager, and senior manager, and production procedure technology senior manager at ScinoPharm.	NA	-	-	-	-
Senior Director Product Portfolio Management	R.O.C.	Yu-Fen Hung	F	2010.09.15	107,194	0.014%	-	-	-	-	Education；PhD in Chemistry, Stanford University, USA Work Experience： Research Scientist, Roche Palo Alto. Chief Researcher, Manager, Senior Manager, Director, ScinoPharm Taiwan	NA	-	-	-	-

~20~

Title	Nationality	Name	Gender	Date Effective	Shareholding (Note1)	Shareholding (Note1)	Spouse & Minor Shareholding	Spouse & Minor Shareholding	Shareholding by Nominee Arrangement	Shareholding by Nominee Arrangement	Experience (Education)	Other Position	Managers who are Spouses or Within Two Degrees of Kinship	Managers who are Spouses or Within Two Degrees of Kinship	Managers who are Spouses or Within Two Degrees of Kinship	Remark (Note 2)
					Shares	％	Shares	％	Shares	％			Title	Name	Relation
Senior Director Accounting	R.O.C.	Chih-Hui Lin	F	2010.06.01	-	-	-	-	-	-	Education: Accounting, Chung Yuan Christian University 、Executive Master of Business Administration of National Cheng Kung University Work Experience: Manager of finance and accounting at Airmate (Cayman) International Co Ltd.; Accounting manager, Senior accounting manager at ScinoPharm.	Director of: ScinoPharm Singapore Pte Ltd. Supervisor of: Technology Co., Ltd.、 SciAnda (Changshu) Pharmaceuticals, Ltd.、 SciAnda Shanghai Biochemical Technology, Ltd	-	-	-	-
Senior Director Finance	R.O.C.	Chih-Ching Hsu	F	2018.08.20	-	-	-	-	-	-	Education: MBA, Leonard N. Stern School of Business, New York University Work Experience: SVP, Credit Risk, HSBC Taiwan, SVP/VP, Credit Risk, HSBC China, AVP/VP, Risk Analysis Unit, GBM, HSBC Taiwan, Senior Financial Analyst, Hudson Advisors, Asia Pacific	NA	-	-	-	-
Director Regulatory Technical Service	R.O.C.	Luh-Chian Chang (Note 4)	F	2012.05.01	-	-	-	-	-	-	Education: PhD in pharmacy, University of IOWA Work Experience: researcher at GeneLab and Scios Inc. of the U.S.; chief analyst and researcher, senior quality assurance specialist, manager & senior manager of pharmaceutical regulations at ScinoPharm.	NA	-	-	-	-
Senior Director of API Business, Marketing and Sales	R.O.C.	Nan-Sheng Chan (Note 5)	M	2012.11.07	89,196	0.011%	-	-	-	-	Education: PhD in Chemical Engineering, Texas A&M University Work Experience: Researcher, ITRI’s Materials & Chemical Research Laboratories; Chief researcher, Standard Chem.& Pharm. Co.; chemical engineer, Jurox Pty Ltd. of Australia; marketing research manager and senior manager, product and market research department director, ScinoPharm.	NA	-	-	-	-

~21~

Title	Nationality	Name	Gender	Date Effective	Shareholding (Note1)	Shareholding (Note1)	Spouse & Minor Shareholding	Spouse & Minor Shareholding	Shareholding by Nominee Arrangement	Shareholding by Nominee Arrangement	Experience (Education)	Other Position	Managers who are Spouses or Within Two Degrees of Kinship	Managers who are Spouses or Within Two Degrees of Kinship	Managers who are Spouses or Within Two Degrees of Kinship	Remark (Note 2)
					Shares	％	Shares	％	Shares	％			Title	Name	Relation
Director Audit Office	R.O.C.	Shun Yang Lin	M	2015.08.03	-	-	-	-	-	-	Education: Department of international Trade, Tunghai University; Master in accounting and information technology, National Chung Cheng University. Work Experience: ScinoPharm’s accounting manager, financial planning manager; deputy director of financial and accounting department, Chi Lin Optoelectronics Co.; chief financial and accounting administrator at RiPAL Optotronics, a subsidiary of Compal Group; chief financial officer at Hsin Kai Luo Precision Machinery Co.	Supervisor of: SciAnda(Changshu) Pharmaceuticals, Ltd.	-	-	-	-
Director Quality Assurance	R.O.C.	Albert Song (Note 6)	M	2017.01.01	531	0.000%-	-	-	-	-	Education: Bachelor Degree, Industrial Engineering, Tunghai University Work Experience: Assistant ScinoPharm’s Plant Engineer/Supervisor, QA Specialist/ Senior Manager, Production Specialist of Top Laminater Corporation, Production Chief of Asia Colloids and Chemicals Corporation, Engineer of Yieh-Loong Steel Co., Ltd.,	NA	-	-	-	-
Director Plant Support and Services, Operation	R.O.C.	Szu Ching Wang	M	2018.09.10	-	-	-	-	-	-	Education: BS, Dept. of Chemical Engineering, National Central University, Master, Dept. of Chemical Engineering, National Taiwan University of Science and Technical Work Experience: VP-Manufacturing, ,Plant Manager of Kaohsiung plant, Director of Safety/Security/Health /Environmental, Sale Manager, BU1 Production Manager, Kaohsiung Plant, Operating Engineer, Process Engineer, Kaohsiung Plant, of China American Petrochemical Co. Ltd. Process & Shift Engineer, TASCO	NA	-	-	-	-

~22~

Title	Nationality	Name	Gender	Date Effective	Shareholding (Note1)	Shareholding (Note1)	Spouse & Minor Shareholding	Spouse & Minor Shareholding	Shareholding by Nominee Arrangement	Shareholding by Nominee Arrangement	Experience (Education)	Other Position	Managers who are Spouses or Within Two Degrees of Kinship	Managers who are Spouses or Within Two Degrees of Kinship	Managers who are Spouses or Within Two Degrees of Kinship	Remark (Note 2)
					Shares	％	Shares	％	Shares	％			Title	Name	Relation
Director of DPT	R.O.C	Yu-Wei Shen	M	2019.04.01	60,000-	-0.007%	35,000	0.004%	-	-	Education: National Central University Chemical Engineering Bachelor, National Taiwan University Chemical Engineering Master Work Experience: Food Industry Research and Development Institute Associate researcher, ScinoPharm Process Technology Department Supervisor, Production Supervisor, Manager, Process Technology Department Manager, Senior Manager	NA	-	-	-	-
Director of Human Resources and Admin.	R.O.C	Rachel Wang (Note 7)	F	2019.06.03	-	-	-	-	-	-	Education： Master of Human Resources Management, Sun Yat-sen University Work Experience: Chief of Administrative Center, HannStar Display Corp., Director of Human Resources and Administration Division, Genesis Photonics Corp., Manager of Human Resources Division, Compal Communications, Compal Group, Deputy Manager of Administration Center, Sumika Technology Corp.	NA	-	-	-	-
Director of Procurement	R.O.C	Chi-Ching Lin (Note 8)	M	2020.02.01	33,512	0.004%	106,619	0.013%	-	-	Education： Hong Kong Polytechnic University, PhD. Work Experience: RD researcher, Production & Material Management Manager	NA	Vice- President Marketing and Sales & Strategic Officer	Ching- Wen Lin	Spouse	-
Director of Analytical R&D	R.O.C	Shih-Hao Yang (Note 9)	M	2020.03.30	-	-	-	-	-	-	Education： Master of Chemistry, National Taiwan University, PhD of Chemistry, National Taiwan University Work Experience: QA & R&D Manager, Seven Star Pharmaceutical, Corporate Analytical Services Director, TWi Pharmaceutical, Quality Head, Visum Pharmaceutical Quality Unit Head/Analytical Research Director, Bright Future Pharmaceutical	NA	-	-	-	-

~23~

Title	Nationality	Name	Gender	Date Effective	Shareholding (Note1)	Shareholding (Note1)	Spouse & Minor Shareholding	Spouse & Minor Shareholding	Shareholding by Nominee Arrangement	Shareholding by Nominee Arrangement	Experience (Education)	Other Position	Managers who are Spouses or Within Two Degrees of Kinship	Managers who are Spouses or Within Two Degrees of Kinship	Managers who are Spouses or Within Two Degrees of Kinship	Remark (Note 2)
					Shares	％	Shares	％	Shares	％			Title	Name	Relation
Director of Information Technology	R.O.C	Cynthia Hung (Note 10)	F	2020.05.18	-	-	-	-	-	-	Education： Lunghwa University of Science and Technology, Information Management. Work Experience: OBI Pharma IT manager, CoCo Fresh Tea & Juice IT manager.	NA	-	-	-	-

(Note 1): Holding Shares and holding percentage as of 2021.05.01

• (Note 2) :Where the Chairman of the Board of Directors and the President or person of an equivalent post (the highest level manager) of a company are the same person, spouses, or relatives within the first degree of kinship ： None

(Note 3): The Vice President was promoted on 2020.08.11

(Note 4): The Director was discharged on 2020.06.01

(Note 5): The Director was discharged on 2021.03.13

(Note 6): The Director was discharged on 2020.06.01

(Note 7): The Director was discharged on 2021.02.10

(Note 8): The Director was newly appointed on 2020.02.01 (Note 9): The Director was newly appointed on 2020.03.30 (Note 10): The Director was newly appointed on 2020.05.18

~24~

3.3 Remuneration paid to Company directors, president, and senior vice presidents over the past year 3.3.1 Remuneration paid to each individual director

												2020.12.31；Unit: NT$ thousands	2020.12.31；Unit: NT$ thousands	2020.12.31；Unit: NT$ thousands	2020.12.31；Unit: NT$ thousands	2020.12.31；Unit: NT$ thousands	2020.12.31；Unit: NT$ thousands	2020.12.31；Unit: NT$ thousands	2020.12.31；Unit: NT$ thousands	2020.12.31；Unit: NT$ thousands	2020.12.31；Unit: NT$ thousands	2020.12.31；Unit: NT$ thousands
Title	Name			Total Director Remuneration						Summation of A，B，C， and D as a % of After- Tax Income		Compensation to Directors Also 5erving as Company Employees								Summation of A，B，C，D， E，F and G as a % of After-Tax Income		Compensa- tion from Affiliates Other Than Subsidiaries
		Remuneration (A)		Pensions (B)		Director Remuneration (C)		Business Expenses (D)				Salary, Bonuses, and special Allowance (E)		Pensions (F)		Employee Compensation (G) (Note 1)
		SPT	All consolidated companies	SPT	All consolidated companies	SPT	All consolidated companies	SPT	All consolidated companies	SPT	All consolidated companies	SPT	All consolidated companies	SPT	All consolidated companies	SPT		All consolidated companies		SPT	All consolidated companies
																Cash Bonuse	5tock Bonuse	Cash Bonuse	5tock Bonuse
Director	Uni-PresidentEnterprises Corp.	2,028	2,028	-	-	7,922	7,922	6,840	6,840	5.95%	5.95%	8,936	8,936	108	108	-	-	-	-	9.16%	9.16%	242,099
Chairman	Uni-President Enterprises Corp. Representative：Chih-Hsien Lo
Director	Uni-President Enterprises Corp. Representative：Tsung-Ming Su
Director	Uni-President Enterprises Corp. Representative：Kun-Shun Tsai
Director	Uni-President Enterprises Corp. Representative：Tsung-Pin Wu
Director	Uni-President Enterprises Corp. Representative：JiaHorng Guo
Director	Uni-President Enterprises Corp. Representative：Fu-JungLai
Director	TainanSpinning Co.,Ltd.
Director	Tainan Spinning Co., Ltd. Representative: Po-MingHou
Director	PresidentInternational Development Corp.
Director	President International Development Corp. Representative：Chiou-Ru Shih
Director	National Development Fund, Executive Yuan
Director	National Development Fund, Executive Yuan Representative：Ming-Chuan Hsieh
Director	National Development Fund, Executive Yuan Representative：Ya-Po Yang
Director	Kao Chyuan Investment Co.,Ltd
Director	Kao Chyuan Investment Co., Ltd Representative：Shiow-LingKao
Director	Taiwan Sugar Corporation
Director	Taiwan Sugar Corporation Representative：Kuo-Hsi Wang
Independent Director	Wei-Te Ho	739	739	-	-	-	-	2,160	2,160	1.03%	1.03%	-	-	-	-	-	-	-	-	1.03%	1.03%
	Wen-ChangChang
	Li-TzongChen
	Total	2,767	2,767	-	-	7,922	7,922	9,000	9,000	6.98%	6.98%	8,936	8,936	108	108	-	-	--	-	10.19%	10.19%	242,099

(Note 1): According to compensations payout for managers passed by the board of directors on 2021.03.18.

(Note 2): ScinoPharm Taiwan's policy, system, standards, structure for monthly compensations of independent directors is decided by the board of directors, according to the corporate charter, as well as their responsibilities, risks, and input time, plus reference to the levels of peers, without bonus payout based on corporate profits. Given the industrial nature and scale of operation/assets, as well as responsibilities, existing compensations for independent directors is reasonable. (Note 3): Compensations other than that disclosed the table above collected by directors for services for all the companies in the financial statement: Nil

~25~

Range of remuneration for directors

	Range of remuneration for directors	Range of remuneration for directors	Range of remuneration for directors	Range of remuneration for directors
Range of Remuneration	Name of Directors
	Total of (A+B+C+D)		Total of (A+B+C+D+E+F+G)
	The company	Companies in the consolidated financial statements	The company	Companies in the consolidated financial statements
Under NT$ 1,000,000	Uni-President Enterprises Corp. Representative: Tsung-Ming Su、Uni- President Enterprises Corp. Representative: Kun-Shun Tsai、Uni- President Enterprises Corp. Representative: Tsung-Pin Wu、Uni- President Enterprises Corp. Representative: Jia Horng Guo、Uni- President Enterprises Corp. Representative: Fu-Jung Lai、Tainan Spinning Co., Ltd.、Tainan Spinning Co., Ltd. Representative: Po-Ming Hou、President International Development Corp、President International Development Corp. Representative: Chiou-Ru Shih、Kao Chyuan Inv. Co., Ltd. Representative: Shiow-Ling Kao、National Development Fund, Executive Yuan Representative: Ming-Chuan Hsieh、Ya-Po Yang、 Taiwan Sugar Co. Representative: Kuo- Hsi Wang、Wei-Te Ho、Wen-Chang Chang、Li-TzongChen	Uni-President Enterprises Corp. Representative: Tsung-Ming Su、Uni- President Enterprises Corp. Representative: Kun-Shun Tsai、Uni- President Enterprises Corp. Representative: Tsung-Pin Wu、Uni- President Enterprises Corp. Representative: Jia Horng Guo、Uni- President Enterprises Corp. Representative: Fu-Jung Lai、Tainan Spinning Co., Ltd.、Tainan Spinning Co., Ltd. Representative: Po-Ming Hou、President International Development Corp、President International Development Corp. Representative: Chiou-Ru Shih、Kao Chyuan Inv. Co., Ltd. Representative: Shiow-Ling Kao、National Development Fund, Executive Yuan Representative: Ming-Chuan Hsieh、Ya-Po Yang、 Taiwan Sugar Co. Representative: Kuo- Hsi Wang、Wei-Te Ho、Wen-Chang Chang、Li-TzongChen、	Uni-President Enterprises Corp. Representative: Kun-Shun Tsai、 Uni-President Enterprises Corp. Representative: Tsung-Pin Wu、 Uni-President Enterprises Corp. Representative: Jia Horng Guo、 Uni-President Enterprises Corp. Representative: Fu-Jung Lai、 Tainan Spinning Co., Ltd.、Tainan Spinning Co., Ltd. Representative: Po-Ming Hou、President International Development Corp、 President International Development Corp. Representative: Chiou-Ru Shih、Kao Chyuan Inv. Co., Ltd. Representative: Shiow- Ling Kao、National Development Fund, Executive Yuan Representative: Ming-Chuan Hsieh、Ya-Po Yang、Taiwan Sugar Co. Representative: Kuo-Hsi Wang、Wei-Te Ho、Wen-Chang Chang、Li-TzongChen	Uni-President Enterprises Corp. Representative: Kun-Shun Tsai、 Uni-President Enterprises Corp. Representative: Jia Horng Guo、 Tainan Spinning Co., Ltd.、Tainan Spinning Co., Ltd. Representative: Po-Ming Hou、President International Development Corp、 President International Development Corp. Representative: Chiou-Ru Shih、 Kao Chyuan Inv. Co., Ltd. Representative: Shiow-Ling Kao、 National Development Fund, Executive Yuan Representative: Ming-Chuan Hsieh、Ya-Po Yang、 Taiwan Sugar Co. Representative: Kuo-Hsi Wang、Wei-Te Ho、 Wen-Chang Chang、Li-Tzong Chen
NT$1,000,000 (included) ~ NT$2,000,000 (not included)	National Development Fund, Executive Yuan、Taiwan Sugar Co. Uni-President Enterprises Corp. Representative: Chih-Hsien Lo Kao Chyuan Inv. Co.,	National Development Fund, Executive Yuan、Taiwan Sugar Co. Uni-President Enterprises Corp. Representative: Chih-Hsien Lo Kao Chyuan Inv. Co.,	National Development Fund, Executive Yuan Taiwan Sugar Co. Kao Chyuan Inv. Co.,	National Development Fund, Executive Yuan Taiwan Sugar Co. Kao Chyuan Inv. Co.,
NT$2,000,000 (included) ~ NT$3,500,000(not included)	None	None	None	None
NT$3,500,000 (included) ~ NT$5,000,000(not included)	None	None	None	None
NT$5,000,000 (included) ~ NT$10,000,000 (not included)	Uni-President Enterprises Corp.	Uni-President Enterprises Corp.	Uni-President Enterprises Corp. Uni-President Enterprises Corp. Representative: Chih-Hsien Lo、 Uni-President Enterprises Corp. Representative: Tsung-Ming Su	None
NT$10,000,000 (included) ~ NT$15,000,000(not included)	None	None	None	Uni-President Enterprises Corp. Representative: Fu-JungLai
NT$15,000,00 (included) ~ NT$30,000,000(not included)	None	None	None	Uni-President Enterprises Corp. Representative: Tsung-Pin Wu 、Uni-President Enterprises Corp. Representative: Tsung-MingSu
NT$30,000,000 (included) ~ NT$50,000,000(notincluded)	None	None	None	None
NT$50,000,000(included) ~NT$100,000,000(not included)	None	None	None	None
Over NT$100,000,000	None	None	None	Uni-President Enterprises Corp. Representative: Chih-Hsien Lo
Total	21	21	21	21

~26~

3.3.2 President and senior vice president remuneration

2020.12.31 ； Unit: NT$ thousand dollars

Title General Chief Strategy Officer President VicePresident Vice President Vice President Vice President VicePresident Vice President	Name	Salary(A)	Salary(A)	Severance Pay (B) (Note 1)	Severance Pay (B) (Note 1)	Bonuses	and Allowances (C)	Profit Sharing- Employee Bonus (D) (Note 2)	Profit Sharing- Employee Bonus (D) (Note 2)	Profit Sharing- Employee Bonus (D) (Note 2)	Profit Sharing- Employee Bonus (D) (Note 2)	Ratio of total compensation (A+B+C+D) to net income(%)	Ratio of total compensation (A+B+C+D) to net income(%)	Remuneration from ventures other than subsidiaries or from the parent company (Note 1)
		The Company	Companies in the consolidated financial statements	The Company	Companies in the consolidated financial statements	The Company	Companies in the consolidated financial statements	The Company		Companies in the consolidated financial statements		The Company	Companies in the consolidated financial statements
								Cash	Stock	Cash	Stock
	Chih-Hsien Lo	23,968	24,842	694	694	3,400	3,400	1,923	-	1,923	-	10.63%	10.94%	226,648
	Tsuung-Ming Su
	Ching-Wen Lin
	Ling-Hsiao Lien (Note 3)
	Chih-Fang Chen (Note 4)
	Katy Cheng
	Li-An(Susan)Lu
	Li-Chiao Chang

(Note 1): 2020 retirement pension appropriate. Appropriation amount or actual payment amount (Note 3): Promoted on 2020.8.11

(Note 2): According to compensations payout for managers passed by the board of directors on 2021.03.18. (Note 4): Discharged on 2020.7.18

Range of remuneration for president and vice presidents

	Range of remuneration forpresident andvice presidents	Range of remuneration forpresident andvice presidents
Range of Remuneration	Name of President and Vice President
	The Company	Companies in the consolidated financialstatements
Under NT$ 1,000,000	Li-An Lu	Li-An Lu
NT$1,000,000 (included) ~ NT$2,000,000 (notincluded)	None	None
NT$2,000,000 (included) ~ NT$3,500,000(not included)	Chih-Fang Chen	Chi-Fang Chen
NT$3,500,000 (included) ~ NT$5,000,000 (not included)	、Chih-Hsien Lo、Tsung-Ming Su、Ling-Hsiao Lien Li-Chiao Chang、Ching-Wen Lin	Ling-Hsiao Lien、Li-Chiao Chang
NT$5,000,000 (included) ~ NT$10,000,000 (notincluded)	Katy Cheng	Ching-Wen Lin、Katy Cheng
NT$10,000,000 (included) ~ NT$15,000,000(not included)	0	0
NT$15,000,00 (included) ~ NT$30,000,000(notincluded)	0	Tsung-Ming Su
NT$30,000,000 (included) ~ NT$50,000,000(not included)	0	0
NT$50,000,000(included) ~ NT$100,000,000(notincluded)	0	Chih-Hsien Lo
Over NT$100,000,000	0	0
Total	8	8

~27~

3.3.3. Distribution of bonuses to Company management during

2020.12.31 ； Unit: NT$ thousands

	Title	Name	Employee Bonus - in Stock (Fair Market Value)	Employee Bonus - in Cash	Total	Ratio of Total Amount to Net Income (%) (%)
Executive Officers	President & CEO	Tsung-Ming Su	—	4,253	4,253	1.51%
	Vice-President Marketing and Sales & Strategic Officer	Ching-Wen Lin
	Vice President Operations	Ling-Hsiao Lien
	Vice President Quality Management	Katy Cheng
	Vice President Administration	Li-An Lu
	Vice President of Injectable Business Division	Li-Chiao Chang
	Senior Director Research and Development	Yu-Fen Hung
	Senior Director Accounting	Chih-Hui Lin
	Senior Director Finance	Chih-Ching Hsu
	Director Purchasing	Chi-Ching Lin (Note 1)
	Director DPT	Yu-Wei Shen
	Director Business Development	Nan-Sheng Chan (Note 2)
	Director IT	Cynthia Huang (Note 3)
	Director Audit Office	Shun Yang Lin
	Director Analytical R&D	Shi-Hao Yang (Note 4)
	Director HR	Rachel Wang (Note 5)
	Director Project	SzuChing Wang

Note 1: Newly appointed on 2020.02.01 Note 2: Retired on 2021.03.13 Note 3: Newly appointed on 2020.05.18 Note 4: Newly appointed on 2020.03.30 Note 5: Discharged on 2021.02.10

~28~

3.3.4 Comparison of Remuneration for Directors, Presidents and Vice Presidents in the Most Recent Two Fiscal Years and Remuneration Policy for Directors, Supervisors, Presidents and Vice Presidents

• A. The ratio of total remuneration paid by the Company and by all companies included in the consolidated financial statements for the two most recent fiscal years to directors, presidents and vice presidents of the Company, to the net income.

Item/Year	The Company	The Company	Companies in the consolidated financial statements	Companies in the consolidated financial statements
	Ratio of total remuneration paid to directors, presidents and vice presidents to net income (%)		Ratio of total remuneration paid to directors, presidents and vice presidents to net income (%)
	2019	2020	2019	2020
Total remuneration paid to directors,	11.21	10.19	11.21	10.19
Total remuneration paid to presidents and vice presidents	12.99	10.63	13.54	10.94

• (a) Remunerations of directors include reward, transportation allowance, income from professional practice, and earnings distribution.

• (b) Remunerations of president and vice presidents are figured out in accordance with the Company’s “Personnel Rules and Regulations” and their bonuses will be adjusted based on the Company’s annual business performance.

• B. Remuneration policy, standards and packages, procedures for determining remuneration and the correlation with operating performance and future risk exposure:

• (a) The compensations for the company's directors for the execution of their duties are set by the board of directors, with authorization based on Article of Incorporation, according to the extent of participation in and contribution to the company's operation, in reference to the levels in Taiwan and abroad. According to the Article of Incorporation, if the company is profitable in the year and there is balance after deduction of compensations for employees and directors and reservation for offsetting loss, up to 2% of the balance would be appropriated as director compensations, to be paid out following resolution by the board of directors and report to shareholders' meeting, excluding independent directors who collect fixed monthly compensations only.

• (b) According to the Article of Incorporation, the appointment, dismissal, and compensations of the company's ranking managers, including president and vice presidents, are set by the board of directors. Compensations for managerial staffers include salaries, bonus, and other fringe benefits, with salaries being set according to rankings, education and experience, expertise, and duties, in reference to peer level, and bonus being set according to the performance evaluation items suggested by compensation committee, including financial indicators (attainment rate of pretax net profit) and non-financial indicators (such as legal compliance, major defect in operating risk and other items), as well as contribution to the company's overall operation.

• (c) Employee compensations are set according to individuals' competence, contribution to the company, performance, market value of their positions, and the company's operating risk in the future, proportionate to the company's business performance. According to the Article of Incorporation, if the company is profitable in the year and there is balance after deduction of compensations for employees and directors and reservation for offsetting loss, up to 2% of the balance would be appropriated as employee compensations, to be paid out following resolution by the board of directors and report to shareholders' meeting. Employee compensations consist of fixed basic salary, bonus, and fringe benefits, with fixed basic salary being set according to market level for the position, bonus being linked to target attainment rate of employees and their divisions, as well as the company's business performance, and fringe benefits being based on legal requirement and employee needs.

~29~

3.4 Implementation of Corporate Governance

3.4.1 Board of Directors

Total of 7 meetings of the Board of Directors were held of 2020 and up to the publish date of the annual report. The attendances of directors were as follows:

Title	Name	Attendance in Person	By Proxy	Attendance Rate (%)	Notes
Chairman	Uni-President Enterprises Corp Representative：Chih- Hsien Lo	7	0	100%	None
Director	Uni-President Enterprises Corp Representative： Tsung-MingSu	7	0	100%	None
Director	Uni-President Enterprises Corp Representative：Kun- Shun Tsai	7	0	100%	None
Director	Uni-President Enterprises Corp Representative： Tsung-Pin Wu	7	0	100%	None
Director	Uni-President Enterprises Corp Representative： Jia-HorngGuo	7	0	100%	None
Director	Uni-President Enterprises Corp Representative： Fu-JungLai	7	0	100%	None
Director	President International Development Corp. Representative: Chiou-Ru Shih	7	0	100%	None
Director	Kao Chyuan Inv. Co., Ltd. Representative: Shiow- Ling Kao	5	2	71%	None
Director	Tainan Spinning Co., Ltd. Representative: Po-Ming Hou	7	0	100%	None
Director	National Development Fund, Executive Yuan Representative: Ming-Chuan Hsieh	7	0	100%	None
Director	National Development Fund, Executive Yuan Representative: Ya-Po Yang	7	0	100%	None
Director	Taiwan Sugar Corporation Representative: Kuo-Hsi Wang	7	0	100%	None
Independent Director	Wen-Chang Chang	7	0	100%	None
Independent Director	Li-Tzong Chen	7	0	100%	None
Independent Director	Wei-Te Ho	7	0	100%	None

~30~

Other issues to be noted:

1. In the event of either of the following situations, dates, sessions, contents of resolutions of the Board Meetings, opinions from all independent directors, and Company responses to their opinions should be noted:

2. (1) Issues specified in Article 14-3 of the Securities and Exchange Act: The Company had set up the Audit Committee, please refer to page 33 Operations of the Audit Committee " for more information regarding to Article 14-5 of the Securities and Exchange Act. ScinoPharm held 7 board meetings of 2020 and up to the publish date of the annual report; and did not have any matters listed in Article 14-3 of the Securities and Exchange Act or other matters not passed by independent directors. Please refer to page 35~36.

3. (2) Other issues opposed by independent directors or about which said directors have reservations should be recorded in writing in the meeting minutes of the Board: None.

4. If there are directors’ avoidance of motions in conflict of interest, the directors’ names, contents of motion, causes for avoidance and voting should be specified:

5. The Company has established a set of “Rules of Procedure for Board of Directors Meeting,” and Article 14 of the regulations stipulates that directors can present opinions and answer questions when the meeting’s subjects are related to their own interests or the interests of the corporate bodies they represent and are likely to undermine the interests of the Company, but they are prohibited from joining discussions or voting operation. They should absent themselves from discussion and vote, and cannot vote on behalf of other directors. There is no avoidance of motions in conflict of interest in 2020 and 2021 as of the date of the publication of the annual report for Board Directors Meetings.

6. The information regarding the self-evaluation (or peer) evaluation cycle and period, evaluation scope, method or evaluation contents:

7. The company's board of directors approved "Rules governing performance evaluation for the board of directors" on November 2019, and executed the Rules started from 2020.01.01.

Evaluation Frequency	Evaluation Period	Evaluation Scope	Evaluation Method	Evaluation Items
Annually	2020.01.01~ 2020.12.31	Performance of the Board of Directors, individual directors, and Functional Committees	Self-evaluation by the Board of Directors’ self- performance by Directors	A. Performance evaluation on the Board of Directors (functional committees) should cover the following aspects: 1. Extent of participation in the company’s operation 2. Contribution to the improvement of the decision-making quality of the board of directors (functional committees). 3. Composition and structure of the board of directors (functional committees). 4. Selection of directors and their continuing study. 5. internal control Performance evaluation by directors should cover the following aspects: 1. Grasp of the company’s objective and mission. 2. Understanding of directors’ responsibilities 3.Extent of participation in the Company’s operation 4. Effort on internal relationship and communications 5. Professional knowledge and continuing study. 6. Internal control

~31~

4. Measures taken to strengthen the functionality of the board and execution evaluation：
(1) The Board of Directors has established an Audit Committee and a Compensation Committee to assist
the board in carrying out its various duties. The Company's board of directors authorizes the auditing
committee and the Compensation committee, both under its direct jurisdiction, to help it exercise the
authority of supervision. Both consist of three independent directors. According to regulations, related
cases must be agreed by the committees before submission to the board of directions for approval
and execution.
(2) According to the revised "Company Act," as notified by the competent authority on Aug. 1, 2018, the
company's 9th board of directors approved amendment to the Articles of Incorporation of the
Company at its 6th meeting on March 25, 2019.
(3) According to the revised "Regulations Governing Acquisition and Disposal of Assets by Public
Companies," notified by the competent authority on Nov. 26, 2018, the Company's 9th board	of
directors approved the Company's "procedure for acquisition or disposal of assets" at its 6th meeting
on March 25, 2019.
(4) The company's 9th board of directors passed the company's "standard procedure handling demands
of directors" at its 7th meeting on May 7, 2019, ahead of the deadline on June 30, set by Taiwan Stock
Exchange in its "Taiwan Stock Exchange Corporation Operation Directions for Compliance with the
Establishment of Board of Directors by TWSE Listed Companies and the Board's Exercise	of
Powers."
(5) In line with the regulation publicized by Financial Supervisory Commission for listed companies to
conduct the performance evaluation of the Board starts from 2020. The company's board of directors
approved "Rules governing performance evaluation for the board of directors" on Nov. 1st 2019, the
Company’s 9th board of directors approved the Company’s "Rules governing performance evaluation
for the board of directors" at its 10th meeting and started the performance evaluation for the board of
directors form Jan. 1st 2020.
(6) In line with the “Act for Establishment and Administration of Science Parks” promulgated by the
President on June 6th 2018, revised "Sample Template for XXX Co., Ltd. Rules of Procedure	for
Shareholders' Meeting" publicized by Taiwan Stock Exchange on Jan.2nd 2020, revised “Sample
Template for OO Co., Ltd. Rules of Procedure for Board of Directors Meeting” publicized	by
competent securities authority on Jan. 15 2020 and revised article 192-1 of Company Act with removal
of the regulation on screening of director nominees by the board of directors, the company’s twelfth
meeting of the Ninth term of Board of Directors approved the revision of “Articles of Incorporation”,
“Rules of Procedure for Shareholders' Meeting", “Rules of Procedure for Board of Directors Meeting”
and “Rules Governing Election of Directors” on March 20th 2020
(7) In line with the revision of article 14-5 of the Securities and Exchange Act on June 21, 2019, the
company's ninth board of directors approved the revision of the "charter of the auditing committee"
and "rules on the responsibility scope of independent directors at its 17th meeting on Dec. 18, 2020.
(8) According to the revised “Sample Template for OO Co., Ltd. Rules of Procedure for Board of Directors
Meeting” publicized by Taiwan Stock Exchange on June 3rd 2020, the company's ninth board	of
directors approved the revision of the " Rules of Procedure for Board of Directors Meeting” at its 18th
meeting on March 18, 2021.
(9) In line with the revision of the "Regulations Government Appointment of Independent Directors and
Compliance Matters for Public Companies," publicized by the Financial Supervisory Commission	on
Jan. 15, 2020, the company's ninth board of directors approved the revision of "measures governing
flow of the nomination of directors" at its 18th meeting on March 18, 2021.
(10)According to the revised "Sample Template for XXX Co., Ltd. Rules of Procedure for Shareholders'
Meeting" publicized by Taiwan Stock Exchange on Jan. 28, 2021, the company's ninth board	of
directors approved the revision of the "Rules of Procedure for Shareholders' Meeting” at its 18th
meeting on March 18, 2021 and will submit the proposal to the 2021 General Shareholders’ Meeting
for approval.
5. 2020 and up to the publish date Board of Directors Meetings attendance detail for Independence
Directors:
Explanation: attend inperson： ；attend byauthorization：@；absent:：*
2020 2020.03.20 2020.05.07 2020.06.30 2020.08.11 2020.11.06 2020.12.18 2021.03.18
Wen-Chang Chang       
Li-Tzong Chen       
Wei-Te Ho       

~32~

3.4.2 Operations of the Audit Committee:

1. Major tasks of the auditing committee in the year

2. (1)The Company's auditing committee consists of three independent directors, in charge of supervising, in assistance to the board of the directors, the Company's flow related to accounting, auditing, and financial report, as well as the quality and credibility of financial control.

3. The Company's auditing committee held 6 meeting in 2020 and 2021 as of the date of the publication of the annual report, with major items it reviewed including:

4. a. major auditing plan and report on major audited items of certified public accountants for the year.

5. b. plan, implementation, and efficacy evaluation of the internal control system;

6. c. Amendment to the procedure for acquisition and disposal of assets and revision of the Articles of incorporation.

7. d. Provision of guarantee for medium-term loans for subsidiaries

8. e. Payout of compensations for directors and employees to directors serving as managers or employees at the same time;

9. f. appointment of certified public accountants and compensations;

10. g. independence and qualification evaluation of certified public accountants;

11. h. quarterly financial report and annual financial report;

12. i. business report and proposal for distribution of earnings;

13. j. other major items designated by the Company or competent authority.

14. (2)Review of financial report:

The board of directors produced the Company's business reports, financial statements, and proposals for earnings distribution for 2019 and 2020, of which the financial statements have been audited by PwC Taiwan, with the results shown in its auditing report. The committee has also audited the business reports, financial statements, and proposals for earnings distribution without finding any impropriety.

• (3)Evaluation of the efficacy of internal control system:

• The Company evaluates the efficacy of the design and implementation of the Company's internal control system, according to the evaluation items stipulated in the "Regulations Governing Establishment of Internal Control Systems by Public Companies." Based on management-control process, the regulations divide internal control system into five constituents: (1) environmental control, (2) risk assessment, (3) control operation, (4) information and communication, and 5. supervisory operation. The evaluation confirms the efficacy of the design and implementation of the Company's internal control system (including oversight and management of subsidiaries) as of 2020.12.31, in terms of attainment of the target for business performance and efficiency, as well as the reliability, timeliness, transparency, and legal compliance of reports.

• (4) Certified public accountants

• To assure the independence of the certifying accounting firm, the Auditing Committee evaluates the independence and qualification of certified public accountants, in reference to the criteria listed in No. 10 "The Norm of Professional Ethics for Certified Public Accountant of the Republic of China." The independence and qualification of certified public accountants Yung-chih Lin and Tzu-meng Liu of PwC Taiwan were reviewed and affirmed by the company's 3[rd ] term Auditing Committee at its 9[th] meeting on 2020.03.11 and the 9[th] term Board of Directors at its 12[th] meeting on 2020.03.20. The independence and qualification of certified public accountants Yungchih Lin and Tzu-meng Liu of PwC Taiwan were reviewed and affirmed by the company's 3[nd] term Auditing Committee at its 14[th] meeting on 2021.03.11 and the 9[th] term Board of Directors at its 18th meeting on 2021.03.18

~33~

1. Total of 6 meetings of the Audit Committee were held of 2020 and up to the publish date of the annual report. Independent director attendance is detailed below:

	Title	Name	Attendance in Person	By Proxy	Attendance Rate (%)	Remark
	Independent director	Wen-Chang Chang	6	0	100%	None
	Independent director	Li-Tzong Chen	6	0	100%	None
	Independent director	Wei-Te Ho	6	0	100%	None

~34~

Note 1. Major resolutions or opinion during the Auditing Committee Meetings

Board of Directors	Contents of Resolutions and follow-up	Circumstances listed in Article 14-5 of the Securities and Exchange Act	Circumstances not approved by the Audit Committee but were approved by two thirds or more of all directors
(1) The twelfth meeting of the Ninth term of Board of Directors (March 20, 2020)	a. The Company’s Remuneration distribution plans for directors and directors who are also employees for fiscal 2019.		none
	b. The Company’s business report, parent and consolidated financial reports for fiscal 2019.		none
	c. The Company’s proposed Distribution of 2019 Earnings.		none
	d. The Company‘s “Statement for Internal Control Systems” for fiscal 2019.		none
	e. The Company’s evaluation results regarding the independence and suitability of the CPAs and the appointment of chartered certified accountant and remuneration package.		none
	f. The Company plans to provide guarantee to SciAnda (Changshou)Pharmaceuticals, Ltd. for mid-term loans		none
	g. Amendment to the “Articles of Incorporation” of the Company.		none
	Audit Committee resolution (March 11, 2020): approval has been obtained from all Audit Committee members
	Company's response to the Audit Committee's opinion: Approval has been obtained from all attended Board members. .
(2) The thirteenth meeting of the Ninth term of Board of Directors (2020,05.07)	a. The Company’s consolidated financial statement and Auditor’s report for the first quarter 0f 2020.		none
	b. Amendment to "Audit committee Charter".		none
	c. Amendment to "Key Points for Operation Governing the Compilation Flow for Financial Statement".		none
	d. Amendment to "Rules Governing Internal Control System”.		none
	e. Amendment to “Enforcement Rules for Internal Auditing".		none
	Audit Committee resolution (April 29, 2020): approval has been obtained from all Audit Committee members
	Company's response to the Audit Committee's opinion: Approval has been obtained from all attended Board members. .
(3) The fifteenth meeting of the Ninth term of Board of Directors (2020.08.11)	a. Self-compiled internal control procedure and implementation evaluation report in financial statement.		none
	b. The Company’s consolidated financial statement and Auditor’s report for the Second quarter 0f 2020.		none
	c. Revision of "key points governing procedure for professional accounting judgments, accounting policy, andmaking changesinestimates"		none
	Audit Committee resolution (August 5,2020) Approval has been obtained from all Audit Committee members
	Company’s response to the Audit Committee’s opinion: Approval has been obtained from all attended Board members.

~35~

Board of Directors	Contents of Resolutions and follow-up	Circumstances listed in Article 14-5 of the Securities and Exchange Act	Circumstances not approved by the Audit Committee but were approved by two thirds or more of all directors
(4) The sixteenth meeting of the Ninth term of Board of Directors (2020.11.06)	a. The CPA’s annual Audit plan and communicate report with company’s governance unit		none
	b. The Company’s consolidated financial statement and Auditor’s report for the third quarter of 2020		none
	Audit Committee resolution (November 02, 2020): approval has been obtained from all Audit Committee members
	Company's response to the Audit Committee's opinion: Approval has been obtained from all attended Board members. .
(5) The seventeenth meeting of the Ninth term of Board of Directors (2020.12.18)	a. ScinoPharm audit planning for 2021.		none
	b. Revision of "Audit committee Charter" and "rules on responsibility scope of independent directors".		none
	Audit Committee resolution (December 14, 2020): approval has been obtained from all Audit Committee members
	Company's response to the Audit Committee's opinion: Approval has been obtained from all attended Board members. .
(6) The eighteenth meeting of the Ninth term of Board of Directors (2021.03.18)	a. The Company’s Remuneration distribution plans for directors and directors who are also employees for fiscal 2020..		none
	b. The company’s Business Report, Parent and Consolidated financial reports for fiscal 2020.		none
	c. The Company‘s earning distribution plan for fiscal 2020.		none
	d. The Company‘s “Statement for Internal Control Systems” for fiscal 2020.		none
	e. The Company’s evaluation results regarding the independence and suitability of the CPAs and the appointment of chartered certified accountant and remuneration package.		none
	f. The Company plans to provide guarantee to SciAnda (Changshou) Pharmaceuticals, Ltd. for mid-term loans.		none
	Audit Committee resolution (March 11, 2021): approval has been obtained from all Audit Committee members
	Company's response to the Audit Committee's opinion: Approval has been obtained from all attended Board members. .

~36~

Note 2: The communications key points between the independent directors and the internal auditors

Date	Attendees	Communication Key Points	result
2020.03.11 Audit Committee 2020.03.20 Board of Directors	Independent Director: Wei-Te Ho Wen-Chang Chang Li-Tzong Chen Audit Officer: Tom Lin	1. Reviewing the Internal Auditor's report for the fourth quarter of 2019. 2. Reviewing and approving 2019 Statement of Internal Control System.	No opinion
2020.04.29 Audit Committee 2020.05.07 Board of Directors	Independent Director: Wei-Te Ho Wen-Chang Chang Li-Tzong Chen Audit Officer: Tom Lin	Reviewing the Internal Auditor's report for the first quarter of 2020.	No opinion
2020.08.05 Audit Committee 2020.08.11 Board of Directors	Independent Director: Wei-Te Ho Wen-Chang Chang Li-Tzong Chen Audit Officer: Tom Lin	Reviewing the Internal Auditor's report for the second quarter of 2020.	No opinion
2020.11.02 Audit Committee 2020.11.06 Board of Directors	Independent Director: Wei-Te Ho Wen-Chang Chang Li-Tzong Chen Audit Officer: Tom Lin	Reviewing the Internal Auditor's report for the third quarter of 2020.	No opinion
2020.12.14 Audit Committee 2020.12.18 Board of Directors	Independent Director: Wei-Te Ho Wen-Chang Chang Li-Tzong Chen Audit Officer: Tom Lin	2021 Audit planning	No opinion
2021.03.11 Audit Committee 2021.03.18 Board of Directors	Independent Director: Wei-Te Ho Wen-Chang Chang Li-Tzong Chen Audit Officer: Tom Lin	1. Reviewing the Internal Auditor's report for the fourth quarter of 2020. 2. Reviewing and approving 2020 Statement of Internal Control System.	No opinion

Note 3: The communications key points between the independent directors and the CPA

Date	Attendees	Communication KeyPoints	result
2020.03.11 Audit Committee	Independent Director: Wei-Te Ho Wen-Chang Chang Li-Tzong Chen CPA: Yung-chih Lin	The CPA’s response in connection with 2019 financial report audit report and problems raised by independent directors	No opinion
2020.04.29 Audit Committee	Independent Director: Wei-Te Ho Wen-Chang Chang Li-Tzong Chen CPA: Yung-chih Lin	The CPA’s response in connection with financial statements audit report for first quarter of 2020 and problems raised by independent directors	No opinion
2020.08.05 Audit Committee	Independent Director: Wei-Te Ho Wen-Chang Chang Li-Tzong Chen CPA: Yung-chih Lin	The CPA’s response in connection with financial statements audit report for second quarter of 2020 and problems raised by independent directors	No opinion
2020.11.02 Audit Committee	Independent Director: Wei-Te Ho Wen-Chang Chang Li-Tzong Chen CPA: Yung-chih Lin	1. The CPA’s response in connection with financial statements audit report for third quarter of 2020 and problems raised by independent directors 2. The CPA’s response in connection with 2020 Audit planning and communication report with cooperative governance divisions.	No opinion
2021.03.11 Audit Committee	Independent Director: Wei-Te Ho Wen-Chang Chang Li-Tzong Chen CPA: Yung-chih Lin	The CPA’s response in connection with 2020 Audit planning and problems raised by independent directors	No opinion

~37~

3.4.3 Corporate Governance Implementation Status and Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies”

Evaluation Item			Implementation Status	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies”and Reasons
	Yes	No	Abstract Illustration
1. Does the Company establish and disclose the Corporate Governance Best-Practice Principles based on “Corporate Governance Best- Practice Principles for TWSE/TPEx Listed Companies”?			The Company established its own “Corporate Governance Best Practice Principles” in accordance with the “Corporate Governance Best Practice Principles for TWSE/GTSM Listed Companies,” with the principles passed by the board of directors on May 8, 2014 and partly revised on May 7th2015, Nov. 8th 2016 and Nov. 1st2019 in line with the revisions made by competent authorities. The latest contents of the Company’s corporate governance best practice principles are revealed on the Market Observation Post System of the TWSE and on the “Investor Relationship/ Corporate Governance/Major Internal Policy” section of the Company’s own website.	None
2. Shareholding structure & shareholders’ rights (1)Does the Company establish an internal operating procedure to deal with shareholders’ suggestions, doubts, disputes and litigations, and implement based on the procedure?			The Company has established the “Rules of Procedure for Shareholders Meetings”, and convenes annual shareholders meeting to serve as a channel of communications with shareholders. In addition, in order to build a good and instant mechanism of exchanges with investors, the Company has also set up spokespersons, acting spokespersons, public affairs and stock affairs specialists to deal with shareholders’ proposals or quench their doubts. In case of any dispute or possible lawsuit, these spokespersons and specialists will seek opinions from the legal affairs unit to work out appropriate countermeasures.	None
(2)Does the Company possess the list of its major shareholders as well as the ultimate owners of those shares?			In addition to the setup of a contact window for stock affairs, the Company has commissioned a stock affairs agent to deal with shareholders - related affairs. It grasps the information on major shareholders and final controllers through the name list of shareholders compiled by the agent, and regularly reports the changes in shareholdings of directors and managers to regulators.	None
(3)Does the Company establish and execute the risk management and firewall system within its conglomerate structure?			Based on the spirit of the "Regulations Governing Establishment of Internal Control Systems by Public Companies," formulated by the Financial Supervisory Commission, the Company has instituted "management practice for preventing insider trading," as the mechanism for prevention and management of insider trading.	None
(4)Does the Company establish internal rules against insiders trading with undisclosed information?			In addition to article 15 of "procedures for ethical management and guidelines for conduct," forbidding use of unpublicized informationby employeesfor insider	None

~38~

Evaluation Item			Implementation Status	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies”and Reasons
	Yes	No	Abstract Illustration
			trading, the company has formulated "procedure for handling major internal information," in order to help employees have correct concept on corporate governance and avoid insider trading. In addition article 3.2 of the "code of conduct for employees" specifies ban on use of inside information by employees for obtaining benefits for themselves or others. The aforementioned regulations have been posted in the "investor relationship/corporate governance" section of the company's website. The company passes promotional materials from competent authority to relevant employees regularly and conducts education/training program on insider trading irregularly, to augment employees' knowledge on the issue. In 2020, in addition to instruction on "common violations of regulations on insider trading and reporting of share transfer by insiders" at managerial meeting on Nov. 23, 2020, the company also disseminate such information to other employees via the company's organ. "ScinoPharm News," the company's e-bulletin, for instance, ran a piece titled "prevention of breach of regulation on insider trading" on Dec. 31, 2020, containing definition, legal basis, related requirements, and cases.
3.Composition and Responsibilities of the Board of Directors (1)Does the Board develop and			1. The Company has called for, in "practical guidelines for corporate governance" and "Rules Governing Election of Director and supervisors", pluralized membership for the board of directors, specifying that directors with a managerial position at the same time should account for not more than one third of the seats on the board of directors and the number of directors whose spouses or relatives within second-degree kinship also sit on the board of directors should not exceed a half of the total seats. In addition, the Company has also formulated the policy of pluralization for its operation, business types, and development need, in terms of, but not limited to, criteria in the following two aspects: (1) Fundamental conditions and values: gender, age, etc. (2) Professional knowledge and skill: professional background, professional skill, and industrial experience. 2. In line with the policy of pluralistic membership, the company's board of directors, in addition to at least two female seats, consists of memberswith	None
implement a diversified policy for the composition of its members?

~39~

Evaluation Item			Implementation Status	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies”andReasons
	Yes	No	Abstract Illustration
			diverse and supplementary backgrounds, including expertise in operation and management, decision making, commerce and economy, finance and accounting, R&D, which encompass industrial experience and international-market perspective, facilitating attainment of sound corporate operation and corporate governance. 3. Status for materialization of the pluralistic policy for the membership of the board of directors: (1) Basic conditions and values: The company's board of directors has 15 seats, including three independent directors, for 20% share, who cannot serve for more than three consecutive terms. One incumbent independent director has served eight to nine years, with the other two directors served two to three years. The current board of directors consists of 12 male directors and three female directors, accounting for 80% and 20%, respectively, averaging 61 in age, with average age of independent directors reaching 62. (2) Professional knowledge and skills (note 1): Members of the current board of directors mostly have knowledge, skills, and upbringing in operational judgment, business management, industrial experience, R&D, leadership and decision making, plus rich global perspective. Members of the board of directors include experts, scholars, and industrial figures with diverse backgrounds, including business management, finance and accounting, monetary affairs, commerce, economics, medicine, pharmaceutics, and chemistry. Independent directors include president of medical university and member of the Academia Senica, director of the National Institute of Cancer Research, under National Health Research Institutes, and college professor, and college assistant professor for accounting. They have plural and supplementary backgrounds, in line with the pluralistic policy for the membership of the board of directors.

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Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies”and Reasons
	Yes	No	Abstract Illustration
(2)Does the Company voluntarily establish other functional committees in addition to the Compensation Committee and the Audit Committee?			The Company hasn’t establish any other functional committee besides the Compensation and Audit committees.	As illustration
(3)Does the Company establish a standard to measure the performance of the Board, and implement it annually? Submit results of performance evaluation to the board of directors as reference in determining the compensation of individual directors and nomination for successive term?			The company evaluated the performances of the board of directors, functional committee, and individual directors in 2020, according to "evaluation measure for performance of the board of directors," approved by the board of directors on Nov. 11th2019, and reported the evaluation results on March 30th2021 In the future, the company will evaluate the performances of the board of directors, functional committees, and individual directors once a year according to the aforementioned measures, whose results will be submitted to the board of directors at its earliest meeting, as reference in the appointment of directors or nomination of director candidates in the future.	None
(4)Does the Company regularly evaluate the independence of CPAs?			Every year, the Company would evaluate the independence and qualification of its contracted CPAs by its own. The latest evaluation was reported to the auditing committee on March 11th2021 before being submitted to and approved by the board of directors on March 18th2021 It has been confirmed that CPAs Lin Yung- chih and Liu Tzu-meng, both of PwC Taiwan, don't hold the positions of directors or managerial staffers at the Company and are not stakeholders of the Company. Nor do they receive pays from or have the relationship of investments or financial- interest sharing with the Company. Evaluation confirms their conformance to the Company's criteria for the independence and qualification of CPAs, ascertaining their suitability to become the Company's CPAs (Note 2). The contracted accounting firm has also issued statement on their independence (Note 3).	None
4. Whether or not public companies have designated sufficient number of qualified corporate-governance staffers and corporate-governance chief, in charge of corporate governance-related affairs (including, but not limited to, preparation of data needed by directors and supervisors in the execution of their duties, assistance for directors and			According to the schedule and normative elements stipulated in "Taiwan Stock Exchange Corporation Operation Directions for Companies with the Establishment of Board of Directors by TWSE Listed Companies and the Board's Exercise of Powers," the company's board of directors passed the institution of corporate-governance chief at its meeting on May 11th2021, in charge of the company's corporate governance-related affairs, requiring the corporate-governance	None

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Evaluation Item			Implementation Status	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies”andReasons
	Yes	No	Abstract Illustration
supervisors in legal compliance, handling of affairs related to meetings of the board of directors and shareholders' meeting and production of minutes for the meetings)?			chief to take courses for study for mandatory hours. In addition, in line with article 3-1 of "Corporate Governance Best Principles for TWSE/TPEx Listed Companies" and article 5 of "Sample Template for Company Rules of Procedure for Board of Directors Meetings," the company has designated the two units of administrative affairs and finance/accounting to handle corporate governance- and meeting-related affairs, according to their respective responsibilities, with the scope including: 1. handling of affairs related to the meetings of the board of directors and shareholders' meeting; 2. production of minutes for the meetings of the board of directors and shareholders' meeting; 3. assistance for directors in assumption of offices and continuing study; 4. provision of data needed by directors in the execution of their duties; 5. assistance for directors in legal compliance; 6. other items specified in company by- laws or contracts. In executing their duties, corporate- governance chief and staffers must abide by the "Company Act," "Securities and Exchange Act," "Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies," and other related legal requirements, in conformance to the spirit and requirements of corporate governance.
5. Does the Company establish communication channels with stakeholders (including, but not limited to, shareholders, employees, customers, and suppliers) and set up an area dedicated to stakeholders on the Company website and does the Company respond appropriately to corporate social responsibility issues that stakeholders consider important?			Establish an open, transparent, and effective communications channel with stakeholders, whose opinions will be used as reference in the formulation, review, and execution of CSR policy. The company has established a "stakeholder section" on its website, with the scope of stakeholders including shareholders/investors, employees, customers, government agencies, communal residents, suppliers/contractors, news media, and industry associations, offering such information as communications windows, issues of concern, and communications channels/frequency. In addition, there has been "reporting system for breach of moral behaviors," offering a channel for stakeholders to report unethical behaviors, which will be handled by persons in charge, as references for improvement in the company's corporate governance and ethical management. The company didn't receive anysuch report in 2020.	None

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Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies”and Reasons
	Yes	No	Abstract Illustration
			Summary of the company's communications with stakeholders in 2020 follows: 1. Shareholders/investors: compliance with anti-epidemic regulations in the holding of shareholders' meeting, attendance of five investors' conference, held by the company or others, publication of 19 pieces of material information; 2. Employees: including holding of four labor-management meetings, publication of six issues of e-bulletin ScinoPharm News, monthly publication of daily-life service programs for employees, and dissemination of information on anti-epidemic measures and hygiene via e-mails. 3. Communal residents: With a history of over 10 years, "ScinoPharm art forum" was held online, with streaming live broadcast, in 2020, alongside an event for donation of secondhand clothes. 4. Customers and suppliers/contractors: Keep close contacts with customers and suppliers/contractors via phone calls, e- mails, periodic questionnaire, field inspection, and online meeting. 5. News media: Update news media on the company's latest development in a transparent manner via phone calls, e- mails, news release, and online investors' conference.
6. Does the Company appoint a professional shareholder service agency to deal with shareholder affairs?			The Company has commissioned the Shareholder Services Department of President Securities Corp. as a dedicated shareholder service agent, which also assists the Company in organizing shareholder’s meetings. The agent is not an “affiliated enterprise” of the Company, as defined in Article 369-2 of the Company Law.	None
7.Information Disclosure (1)Does the Company have a corporate website to disclose both financial standings and the status of corporate governance?			The Company has launched a corporate website featuring dedicated sections for both investor relationship and interested parties, and a specific unit is assigned to manage and maintain the website, so as to timely update detailed information on the Company’s finance, operation, corporate governance and corporate social responsibility. The website address is: www.scinopharm.com.tw	None
(2)Does the Company have other information disclosure channels (e.g. building an English website, appointing designated people to handle information collection and			1. The Company has set up an English- language website to release its financial information in English for reference by investors. The website address is: www.scinopharm.com.tw	None

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Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies”and Reasons
	Yes	No	Abstract Illustration
disclosure, creating a spokesman system, webcasting investor conferences)?			2. In order to boost the transparency of its information revelation, the Company has assigned a specific unit to handle information collection and revelation. 3. The Company has appointed spokespersons and acting spokespersons to handle external speeches and information relation affairs, so as to make shareholders and interested persons better understand the Company’s financial operations and corporate governance implementation. 4. Briefings and video information of the Company’s institutional investor conferences held quarterly and attend irregularly investor conferences held by domestic or foreign investment institutions, with related briefing and audio-visual materials, in both Chinese and English, are also revealed on the Market Observation Post System of the TWSE and the Company’s own website.
(3) Whether or not the company publicizes and declares annual financial report within two months after the end of fiscal year and publicizes and declares financial reports for the first, second, and third quarter, as well as report on monthly business status, ahead of set deadline?			Given the schedule for the compilation and auditing of financial statement, the company has yet to be able to publicize and declare annual financial report within two months after the end of fiscal year but in line with the principle of information transparency, will try its best to publicize and declare quarterly financial report and report on monthly business status ahead of set deadline.	Same with Remark
8. Is there any other important information to facilitate a better understanding of the Company’s corporate governance practices (e.g., including but not limited to employee rights, employee wellness, investor relations, supplier relations, rights of stakeholders, directors’ and supervisors’ training records, the implementation of risk management policies and risk evaluation measures, the implementation of customer relations policies, and purchasing insurance for directors and supervisors)?			1. Welfare of and Care for Employees: The Company shows high regard for harmonious labor-management relationship, and has constantly upgraded the interests and welfare of employees, such as offering employee dormitory, small welfare stations, employee restaurant, breastfeeding room, visually impaired massage service, employee travels, compensation for employee association, physical examination, performance bonus, employee stock subscription, and dividend sharing etc., all designed to make employees enjoy a sound welfare system and work hard to contribute well to the Company. 2. Investor Relationship: The Company makes it the greatest goal to safeguard the interests of shareholders and grant equal treatment to all the shareholders. Accordingly, the Company has not only timely revealed major information on financial and	None

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Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies”andReasons
	Yes	No	Abstract Illustration
			business operations and changes in internal shareholdings on the Market Observation Post System in accordance with related regulations, but has also set up an “Investor Relationship” section on its website to allow timely release of the Company’s financial and corporate governance information. The company’s General Shareholders’ Meeting minutes is recorded according to Company Act and other relative regulation, which is publicized in Company Website and kept by the company throughout the existence of the Company. 3 Supplier Relationship: The Company has worked out a set of rules governing the management of exchanges with suppliers, aiming to build long-term close relationship with suppliers under the win-win principle to jointly pursue sustainable development and growth. 4. Interests of Interested Parties: The Company thinks highly of maintaining good relationship with interested parties including shareholders/investors, employees, customers, government agencies, communal residents, suppliers/contractors, news media, and industry associations. Besides fulfilling each other’s rights and obligations in accordance with relevant laws and regulations, contracts and operating rules, the Company also endeavors to maintain good communication channels to safeguard legal interests of both parties, based on an integrity principle. 5. Study Courses for Directors (including Independent Directors): The Company’s directors (including independent directors) take study courses in accordance with related legal regulations, with number of the study hours meeting or even exceeding the required level. The Company will continue to arrange irregular study courses for its directors (including independent ones). Please see the annual report to learn more in this regard from the “Table of Study Courses for Directors and Independent Directors in 2020. (Please refer to page 70~72) 6. Risk Management Policy and Implementation of Risk Assessment Criteria:

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Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies”andReasons
	Yes	No	Abstract Illustration
			The Company’s major business operation policies, investment projects, guarantee endorsements, lending to others and loans from banks all undergo intensive analysis and evaluation by internal competent units and then are put into practice based on resolutions passed by the board of directors. 7. Implementation of Customer Policy: The Company follows the cGMP regulations governing pharmaceutical production to provide clients with high- quality and safe products, and its dedicated customer service staffers are assigned to deal with opinions presented by customers. 8. Liability Insurance for Directors and Independent Directors: The Company has implemented liability insurance for its directors and managerial staff in accordance with the law. The insurance is renewed every year after reporting the insured amount, coverage, and premium to the board of directors and receiving its approval. The latest insurance, spanning the period from July 2020 to July 2021, was reported to and approved by the board of directors on June 30, 2020.
9. Please explain improvements that have been made as well as priorities to improve the results of the Corporate Governance Evaluation issued by the Taiwan Stock Exchange Corporate Governance Center: According to the final result of the seventh corporate-governance evaluation, the Company explains the status of improvement andpriorityitems for further improvement as follows: Contents of Evaluation Item Status of Improvement andPriorityItems Whether or not the company has disclosed in details in its annual report regarding the agenda and resolutions of the Compensation Committee and how did the company handle committee members' suggestions? 2020 annual report will cover related information accordingly. Whether or not the company has instituted corporate-governance chief who will be in charge of corporate governance-related affairs and explained the position's scope of authority, major businesses carried out in the year, and status of related study and disclose such information through company website and annual report? The company will propose institution of corporate- governance chief who will be in charge of corporate governance-related affairs to the board of directors by June 30th2021, and such information will be disclosed through company website and annual Report. Whether or not the company has put in place risk management and procedure, approved by the board of directors, disclosing the scope, organizational structure, and operation of risk management? Although the company has yet to formulate risk management policy and procedure, approved by the board of directors, the company has been carrying out risk management in its operation, according to its operating guidelines, and will formulate and execute the aforementioned policy and procedure after approval bythe Board of Directors Whether or not the company has disclosed on its own initiative the amount and nature of non-auditing fees to certified public account or affiliate of his/her accounting firm? The amount of non-auditing relevant fees doesn’t reach one fourth of the Company’s annual auditing expenses in 2019 and doesn’t apply to the “volunteering disclosure” definition; however, the company still disclose audit and non-audit fee and services contents.

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	Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Implementation Status	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies”andReasons	Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies”andReasons
		Yes	No	Abstract Illustration
	Whether or not the company held investors' conference at least twice, either at invitation or by itself, at an interval of at least three months or longer, during the evaluation year? [An extra point is added to the total score, in case investors' conference is held at least once a quarter.]				The company will hold investors' conference at least once a quarter in 2021
	Whether or not the company discloses annual greenhouse-gas emission volume, water consumption volume, and total waste weight in the past two years? [An extra point is added to the total score for external certification of annul greenhouse-gas emission volume, water consumption volume, and total waste weight in thepast twoyears.]				The company will evaluate the feasibility of external certification for 2020 CSR report.
	Whether or not the company's website or annual report discloses stakeholders' identity, concerned issues, and communication channels and response methods? [An extra point is added to the total score for periodic report on communications with stakeholders to the board of directors.]				In 2021, the company will report communications with stakeholders to the board of directors and disclose the contents and frequency of the report.

Note1 ： Our boards of directors possess the following abilities:

Item/Name	Gender	Professional background	Ability to make professional judgement	Ability to conduct management administration	Commerce and Economics	Ability to perform accounting and financial analysis	Knowledge of the industry	Professional R&D	An Internationa l market Prospect	Ability to lead	Ability to make policy decisions
Chih-Hsien Lo	M	Business Administration									
Tsung-Ming Su	M	Business Administration									
Kun-Shun Tsai	M	Food technology									
Tsung-Pin Wu	M	Finance & accounting									
Jia-Horng Guo	M	Finance & Banking									
Fu-Jung Lai	M	Business Administration								
Po-Ming Hou	M	Tourist management									
Shiow-Ling Kao	F	Business									
Ming-Chuan Hsieh	F	Medical Matters Management									
Ya-Po Yang	M	Economics									
Chiou-Ru Shih	F	Economics									
Kuo-Hsi Wang	M	Agro-chemical									
Wei-Te Ho	M	Finance & accounting									
Wen-Chang Chang	M	Pharmacy									
Li-Tzong Chen	M	Clinical Medicine									

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3.4.4 Composition, Responsibilities and Operations of the Compensation Committee

• Based on the Article of Incorporation, the Company has established Compensation committee, whose members are appointed by the board of directors, according to the organic regulations of the committee. The current Compensation committee, the fourth Session, comprises three independent directors, who fulfill the following authorities faithfully, as a prudent administrator, and submit suggestions to the board of directors for discussion:

• (1)Formulating and periodically reviewing the policy, system, criteria and structure associated with the remunerations of directors, supervisors and managerial staff, and assessing their performances.

• (2)Periodically assessing and determining the remunerations of directors, supervisors and managerial staff.

The company's Compensation committee adheres to the following principles in exercising the aforementioned authorities:

• (1)In performance evaluation and determination of salaries and compensations, take into account the payment levels of peers, individual performance, the company's business performance, and future risks.

• (2)Discourage directors and managers from taking risk beyond reasonable scope for the company, in their quest for high salaries and compensations.

• (3)Take into account industry features and the company's business nature, in determining the share for the payout of bonus for directors and ranking managers and modification of the payment time for salaries and compensations.

The aforementioned salaries and compensations include cash compensations, stock options, stock bonus for employees, retirement benefits and termination benefits, various subsidies, and other substantial incentives.

3.4.4.1 Information Regarding Remuneration Committee

Position	Criteria Name	Meets One of the Following Professional Qualification Requirements, Together with at Least Five Years’ Work Experience	Meets One of the Following Professional Qualification Requirements, Together with at Least Five Years’ Work Experience	Meets One of the Following Professional Qualification Requirements, Together with at Least Five Years’ Work Experience				Criteria (Note)	Criteria (Note)	Criteria (Note)	Criteria (Note)				Number of Other Public Companies in Which the Individual is Concurrently Serving as an Compensation Committee Member	Remark
		An instructor or higher position in a department of commerce, law, finance, accounting, or other academic department related to the business needs of the Company in a public or private junior college, college or university	A judge, public prosecutor, attorney, Certified Public Accountant, or other professional or technical specialist who has passed a national examination and been awarded a certificate in a profession necessary for the business of the Company	Has work experience in the areas of commerce, law, finance, or accounting, or otherwise necessary for the business of the Company	1	2	3	4	5	6	7	8	9	10
Independent director	Wei-Te Ho														1	None
Independent director	Wen-Chang Chang														0	None
Independent director	Li-Tzong Chen														0	None

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• Note: Please tick the corresponding boxes that apply to a member during the two years prior to being elected or during the term(s) of office.

• Not an employee of the company or any of its affiliates;

• Not a director or supervisor of the company or any of its affiliates;

• Not a natural-person shareholder who holds shares, together with those held by the person's spouse, minor children, or held by the person under others' names, in an aggregate of one percent or more of the total number of issued shares of the company or ranking in the top 10 in holdings;

• Not a spouse, relative within the second degree of kinship, or lineal relative within the third degree of kinship, of a managerial officer under subparagraph 1 or any of the persons in the preceding two subparagraphs;

• Not a director, supervisor, or employee of a corporate shareholder that directly holds five percent or more of the total number of issued shares of the company, or that ranks among the top five in shareholdings, or that designates its representative to serve as a director or supervisor of the company under Article 27, paragraph 1 or 2 of the Company Act;

• Not a majority of the company's director seats or voting shares and those of any other company are controlled by the same person: a director, supervisor, or employee of that other company;

• Not the chairperson, general manager, or person holding an equivalent position of the company and a person in any of those positions at another company or institution are the same person or are spouses: a director (or governor), supervisor, or employee of that other company or institution;

• Not a director, supervisor, officer, or shareholder holding five percent or more of the shares, of a specified company or institution that has a financial or business relationship with the company;

• Not a professional individual who, or an owner, partner, director, supervisor, or officer of a sole proprietorship, partnership, company, or institution that, provides auditing services to the company or any affiliate of the company, or that provides commercial, legal, financial, accounting or related services to the company or any affiliate of the company for which the provider in the past 2 years has received cumulative compensation exceeding NT$500,000, or a spouse thereof; provided, this restriction does not apply to a member of the Compensation committee, public tender offer review committee, or special committee for merger/consolidation and acquisition, who exercises powers pursuant to the Act or to the Business Mergers and Acquisitions Act or Securities and Exchange Act.

• Not been a person of any conditions defined in Article30 of the Company Law ；

3.4.4.2 Attendance of Members at Compensation Committee Meetings

• (1). There are 3 members in the Compensation Committee.

• (2). The forth term of the Compensation Committee is from July 5 2018 to June 26 2021. Total of 5 Compensation Committee meetings were held in 2020 and up to the print date. The attendance record of the Compensation Committee members was as follows:

Title	Name	Attendance in Person	By Proxy	Attendance Rate (%)	Remarks (Note)
Convener	Wen-Chang Chang	5	0	100%	None
Committee Member	Li-Tzong Chen	5	0	100%	None
Committee Member	Wei-Te Ho	5	0	100%	None
Other mentionable items: 1. If the board of directors declines to adopt or modifies a recommendation of the compensation committee, it should specify the date of the meeting, session, content of the motion, resolution by the board of directors, and the Company’s response to the compensation committee’s opinion (eg., the remuneration passed by the Board of Directors exceeds the recommendation of the compensation committee, the circumstances and cause for the difference shall be specified): None. 2.Resolutions of the compensation committee objected to by members or subject to a qualified opinion and recorded or declared in writing, the date of the meeting, session, content of the motion, all members’ opinions and the response to members’ opinion should be specified: None.

• Note: (1) For members of the Compensation committee who leave the post by the end of a year, specify the dates for their departure in the column of notes and attendance rates (%) are calculated by the division of their attendance times by the number of committee meetings during their service periods.

• (2) If there is reelection for the compensations committee before the end of a year, fill in the names of all the original and new members, including reelected ones, and specify the nature of their membership (original, new, and continuing one) in the column of notes, as well as the date of the reelection. Attendance rates (%) are calculated by the division of their attendance times by the number of committee meetings during their service periods.

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Compensation Committee Meeting dates and Terms	Proposals contents	Resolutions	The company’s responses to proposals from Compensation Committee
2020.03.11 The eighth meeting of the Forth Term	1.The Company’s remuneration distribution plans for directors and employees for fiscal 2019 2.The Company’s performance bonus for Managing Directors and above for fiscal 2019 3.Compensation planning for hiring managerial positions	Approved by all attended Compensation Committee Members	Submitted to the Board of Directors Meetings for approval
2020.04.29 The ninth meeting of the Forth Term	1.Compensation planning for hiring managerial positions 2.“Revision of Regulations for Organization of Compensation committee”	Approved by all attended Compensation Committee Members	Submitted to the Board of Directors Meetings for approval
2020.08.05 The tenth meeting of the Forth Term	Compensation planning for hiring managerial positions	Approved by all attended Compensation Committee Members	Submitted to the Board of Directors Meetings for approval
2020.12.14 The eleventh meeting of the Forth Term	1. Approved employees’ salary adjustment program for 2019(including managers). of ScinoPharm Taiwan, Ltd. 2.Compensation planning for hiring managerial positions for subsidiary	Approved by all attended Compensation Committee Members	Submitted to the Board of Directors Meetings for approval
2021.03.11 The twelfth meeting of the Forth Term	1.The Company’s remuneration distribution plans for directors and employees for fiscal 2020 2.The Company’s performance bonus for Managing Directors and above for fiscal 2020 3. Compensation planning for hiring managerial positions	Approved by all attended Compensation Committee Members	Submitted to the Board of Directors Meetings for approval

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3.4.5 Corporate Social Responsibility

Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Deviations from “Corporate Social Responsibility(CSR) Best Practice Principles of TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Explanation
1. Does the company follow the principle of materiality in evaluating risks related to the issues of environment, society, and corporate governance related to the company's operation and formulate related risk-management policy or strategy?			In line with the Company's "corporate social responsibility best principles," which is based on the "Corporate Social Responsibility Best Practice Principles for TWSE/GTSM Listed Companies," and given connection between CSR development trend, both in Taiwan and abroad, and corporate core businesses, and the influence of business activities of the company and group on stakeholders, the company has formulated CSR policy, system or related management guidelines, and concrete implementation plan. In fulfilling corporate social responsibility, the company attends to the interests of stakeholders and regards highly such factors as environment, society, and corporate governance while pursuing sustainable development and profits. Such factors have been incorporated into the company's management guidelines and business activities, as the company reviews and evaluates possible risks and the effectiveness of related management strategy: 1. Environment: Treat environmental protection and public safety as key issues and establish an effective occupational safety and health system, based on the strictest "responsible care system" of the chemical engineering industry, so as to assure the safety of people and actual operation of waste abatement, emission reduction, and pollution prevention, as well as avoid environmental-pollution risk and attain harmonious co-existence with community and environment. 2. Society: Treating of labor safety and employees' welfare as key issues, the company strives to forge a safe and healthy working environment, regards employee education and training highly, and offers good fringe benefits, so as to create a good labor-management relationship and avoid the risk of labor-management disputes, thereby realizing the target of employee-based operation. 3. Corporate governance: Treat legal compliance as a key issue and assure legal compliance by the company and employees via concerted effort of related units and internal control, so as to avoid the risk of breach of laws/regulations. All the information concerning the Company’s fulfillment of its corporate social responsibility has been revealed in the Company’s annual report and on its website’s “Corporate Social Responsibility” section.	None
2. Does the Company establish exclusively (or concurrently) dedicated first-line			The Company’s president is authorized by the board of directors to supervise the execution of the mission of fulfilling corporate social responsibilities bythe Companyand its affiliated enterprises,and	None

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Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Deviations from “Corporate Social Responsibility(CSR) Best Practice Principles of TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Explanation
managers authorized by the board to be in charge of proposing the corporate social responsibility policies and reporting to the board?			then duly report the implementation results to the board of directors. Report on the status of execution in the year and key points of enforcement plan (including stakeholders’ related issues) for the following year was presented in the meeting of the board of directors on November 6th 2020. The Company assigns two departments to execute the mission. The Administration and Human Resources Department is responsible for planning and implementing the tasks of safeguarding legal interests of employees, enforcing social participation and public-service payback, and revealing information on corporate social responsibility in accordance with related labor rules and regulations. The Safety, Health and Environmental Protection Department takes charge of maintaining environmental safety and health by studying, planning and monitoring the Company’s practical measures designed to reduce production risks, sustain environmental safety and health, and promote the health of employees. In addition, the Company has set up an “Occupational Safety and Health Committee” and a “Sustainable Management Committee.” The former is the Company’s top decision-making unit for environmental safety and health, established in accordance with the Occupational Safety and Health Act, with the Company’s president as a General Convener and is responsible for convening a quarterly meeting with chiefs of business units and production plants, heads of various departments and employee representatives to examine the Company’s practices in promoting environmental safety and health and determine a future direction for making key improvements. The latter is established to integrate the tasks in promoting environmental protection, safety and health, energy saving, water conservation, and greenhouse gas management, so as to effectively boost the Company’s sustainable competitiveness. The Sustainable Management Committee is headed by the vice production president and comprises six sub- committees, such as sales and distribution, health, safety, sanitary, waste reduction, and energy saving, to map out annual sustainable management plans and review the implementation of the plans, so as to serve as the basis for internal examinations. All the efforts to safeguard the health of employees, create a safe and friendly working environment or list environmental protection among the Company’s goals are designed to consolidate the Company’s foundation. The Company’s affiliated enterprises have set up their own “Production SafetyCommittee” as the

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Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Deviations from “Corporate Social Responsibility(CSR) Best Practice Principles of TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Explanation
			top decision-making unit for environmental safety and health promotion. The committee is headed by president, who is responsible for convening chiefs of business units and production plants, and heads of various departments to promote the safety, health and environmental protection systems and determine the future direction for making key improvements. In addition, the committee should also compare the Company’s safety systems with national standards, periodically examine the difference between the current state and operating principles, formulate or revise action plans for execution by related units, and review the implementation progress. Besides, the Company has established an “Employee Welfare Committee” and a “Labor- Management Meeting” to screen, promotes and supervises employee welfare operations, mediate labor-management relationship and push for labor- management cooperation, in accordance with related rules and regulations.
3.Environmental Topic (1) Does the Company establish proper environmental management systems based on the characteristics of their industries?			The Company’s environment management system is established in accordance with the chemical industry’s strictest “Responsible Care” system. The Responsible Care system is initiated by the global chemical engineering community to help enterprises set up a sound industrial safety, health and environmental protection system, through concrete commitments to improving the EHS (environment, health and safety) aspects by signing the Statement of Commitment (a prerequisite for membership), formulating the Codes of Management Practices, implementing a Self-Evaluation system, promoting the Management System Verification (MSV), delivering the SHE Performance Indicators report, and sharing responsible care systems with other companies. The Company has joined the Taiwan Responsible Care Association (TRCA) as a member since its plant was inaugurated, actively promoting its safety, health and environmental protection management system. Besides stringently observing environmental protection regulations issued by the competent authorities, the Company also conducts various public activities associated with environmental management to boost resources utilization efficiency and reduce the output of wastes, so as to respond positively to public concerns, further protect public safety, health and environment, reduce the total amount of pollutant emissions on the air, water and soil, boost pollution prevention efficiency and economic benefits, and complete verification on six management codes set by the TRCA. Of the codes, those associated with environmental management includeprocedure safety	None

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Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Deviations from “Corporate Social Responsibility(CSR) Best Practice Principles of TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Explanation
			management, wastes management, emissions reduction management and product management. Concrete practices are as follows: 1. During its research and development (R&D) of production procedures for pharmaceuticals, the Company manages to skip the use of substances or materials subject to restrictions under domestic and international regulations, such as toxic chemicals, precursor chemicals for narcotic drugs, controlled substances for chemical weapons, and ozone depleting substances, and instead, uses less-toxic or- hazardous substances and materials as substitutes. 2. During its R&D of production procedures for pharmaceuticals, the Company manages to assess the possibility of reducing the usage amount of chemical solvents and hazardous substances to mitigate relevant impact on environment and decrease the exposure to hazardous chemicals or active substances on the part of operating staff. 3. Before putting a new production procedure into practice, the Company should organize a meeting to analyze the possible hazard of the production procedure, focusing discussions on the likely hazard to safety, health and environment and then seeking proper preventive solutions. 4. The Company disposes of all the wastes generated by production plants, including biodegradable waste water, waste solvents, solid wastes, and air pollutants, totally in accordance with related regulations. 5. The biodegradable waste water is usually treated via an activated sludge process and an ultrafiltration system, and the resultant organic sludge is separately filtered and then incinerated by the Resource Recycling Center of the Southern Taiwan Science Park, or other qualified incineration vendors with the disposed waste water and waste living water piped into the waste water disposal plant in the science park. The organic sludge generated at the Company’s affiliated enterprise undergoes a separate filtration process before being delivered to the Jiangsu Kangbo Industrial Solid Rejectamenta Treatment Co., Ltd. for incineration. And the disposed waste water and the waste living water are piped into Binjiang Waste Water Disposal Plant. 6. Hazardous or general solid wastes are delivered to the Resource Recycling Center of the science park or other qualified companies for incineration. The air pollutants generated by production plants, such as particulate pollutants, acid gas, alkaline pollutants and organic steam,all undergo two-

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Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Deviations from “Corporate Social Responsibility(CSR) Best Practice Principles of TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Explanation
			step treatment by condenser and scrubbing tower for disposal. The recyclable solvents generated by the Company’s affiliated enterprise are sent to the Kunshan Deyuan Environmental Protection Development Co., Ltd. for purification and recycling. Although the Company hasn't undergo ISO14001 certification, in addition to the aforementioned environment management system now in smooth operation and compliant with the features of biotech and pharmaceutical industry, the Company has experienced more than 10 times of factory inspections by regulators of the U.S., Europe, and Japan (FDA, EMA), EDQM, and PMDA) and auditing of safety, hygiene, and environmental protection by international pharmaceutical firms (such as Pfizer, GSK, and Aventis), all of affirm the soundness and completeness of company's environment management system. ISO14001 certification is meant to offer a standard environment management system for abidance by enterprises. The Company has put in place a complete industrial safety, hygiene, and environment protection system, which has gained international acceptance and certified by international firms, making ISO14001 certification dispensable for the Company. In compliance with the highest standards and the spirit of sustainable management, the Company will continue strengthen environment management system and concern for the issues of industrial safety, hygiene, and environmental protection, meeting the requirements of international standards and fulfilling corporate social responsibility.
(2)Does the Company endeavor to utilize all resources more efficiently and use renewable materials which have low impact on the environment?			The company has set up "sustainable management committee," in charge of environmental protection, occupational safety and health, energy conservation, and greenhouse-gas emission, overseeing a waste abatement and energy conservation team responsible for raising utilization efficiency of various resources and lowering impact on environment. The committee puts forth annual sustainable management plan and reviews execution performance for improvement. In this regard, the tasks undertaken include recycling garbage resources, employing recycled materials to reduce adverse impact on the environment, recycling compensated water from reverse osmosis pure water machines and air conditioners to cooling towers, adopting water- conservation washing faucets, saving living water, incorporating the concept of environmental protection and green energy into production procedure and equipment, promoting green environmental protection and laying stress on ecological balance.	None

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Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Deviations from “Corporate Social Responsibility(CSR) Best Practice Principles of TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Explanation
(3)Whether or not the company has evaluated the potential risks and opportunities of climate change for the company, now and future, and adopted countermeasures for related issues?			The company has set up a "sustainability management committee, summarizing information on climate change issue in Taiwan and abroad and feedback opinions from various sections irregularly, to monitor and identify potential risks and corresponding opportunities and benefits of climate-change issues for ScinoPharm, such as materials price hike induced by extreme weather, advance planning and setup of plural supply sources, cost increase caused by greenhouse-gas emission, set up of carbon abatement devices and reduction of emission, impact of unstable power and water supply on production and improvement of resources utilization efficiency, increase power bill resulting from energy transformation in the short term, and potential benefits in the future, as well as formulation of corresponding risk management and corresponding measures, so as to augment ScinoPharm's management and adjustment capability for climate change, resources utilization, and other related issues. In addition, the company has put in place a business continuity plan, evaluating and analyzing various risks which may disrupt its operation and formulating countermeasures. The "sustainability management committee" comprised six functional sections, namely distribution, health, safety, hygiene, waste reduction, and energy conservation. For the sake of energy conservation and carbon abatement, the energy conservation section conducts greenhouse-gas inventory and devises strategy for energy conservation/carbon abatement and greenhouse-gas reduction strategy, in addition to reviewing its performance quarterly. Existing emission reduction strategies include substitution of gas-fired boilers for oil-fired boilers for steam supply, enhance energy efficiency of air conditioning systems, installation of water-saving, low power- and heat-consumption energy-saving equipment and devices, subsidy for carpooling among employees, and arrangement of transportation bus, so as cut gasoline consumption. For other countermeasures and management goal, please refer to summarized explanation in item number(4).	None
(4) Whether or not the company has calculated its total volumes of greenhouse-gas emission, water consumption, and wastes and formulated policies on energy conservation,carbon			1. The Company’s greenhouse gas emission amount has stayed at a low level, with aggregate annual emissions of six greenhouse gases reaching 23,302 metric tons of CO2 in 2020 and about equal compare with 23,132 metric tons in 2019. Further details are as follows: * Direct greenhouse gas emissions, including those from fuel-burning equipment (such as boilers and restaurant facilities) and mobile combustion sources from transportation(such	None

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Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Deviations from “Corporate Social Responsibility(CSR) Best Practice Principles of TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Explanation
abatement, green- house gas emission reduction, water- consumption reduction, and other waste management measures?			as the Company’s service cars), amounted to 2,658 metric tons of CO2 in 2020, accounting for 11.4% of the Company’s total annual CO2 emissions for the year. Indirect greenhouse gas emissions, mainly from electric power purchased externally came to 20,644 metric tons of CO2, commanding 88.6% of the Company’s total CO2 emissions in 2020. 2. The water usage of recent two years is 147,251 cube meter for 2020 and 140,570 cube meter for 2019. As for the quantity and handling process for waste water and waste, please see CSR report for detailed explanation. 3. Formulate 2021 waste reduction goals, including Reducing Nitrogen usage: Set up the goal of Nitrogen usage for each plant. Reducing the daily usage from 10.3 tons to 9.8 tons. * Via collection of process solvent, cut of cleansing solvent, intensification of steam- stripper treatment, and monitoring and control of the toxicity of waste water, cut waste expense to less than NT$28 million a year. 4 In line with the environment-protection objective set by international pharmaceutical firms Novartis for its supply chain, the company, with 2019 as the base year, started to incorporate compliance with international requirement for environmental protection into its business plan, on top of attainment of production goal, in 2020. The company has targeted cutting greenhouse- gas emission by 1-2%, water consumption by 1- 2%, and waste output by 3-5% (based on the 2018 level) via various energy-conservation and waste-abatement measures.
4. Social Topic (1)Does the Company formulate appropriate management policies and procedures according to relevant regulations and the International Bill of Human Rights?			1. The company formulates various management policies based on criteria even better than the stipulations of the "Labor Standards Act" and abide by the spirit of the "International Covenant on Civil and Political Rights" and the "International Covenant on Economic, Social, and Cultural Rights." In addition to stressing respect and equal rights, the corporate culture calls for protection of basic human rights and gender equality in work, which is incorporated into systems and regulations. The company also bans, in specific regulations, child labor and any form of discrimination or differentiated treatment in employment, performance evaluation, and promotion, due to gender, race, marital status, religion, party affiliation, sex orientation, job grade, nationality, or age. For a harmonious workplace, the company has formulated plan preventing illegal encroachment in execution of duties or workplace violence, on top of measures preventing and tackling sex harassment. Anyemployee complaint will be	None

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Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Deviations from “Corporate Social Responsibility(CSR) Best Practice Principles of TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Explanation
			investigation and treatment according to a set procedure and informants are protection against any revenge or unfavorable treatment. 2. With high regard for employees' continuous growth in work, ScinoPharm offers employees opportunities to develop multiple skills and experiences, via not only on-the-job training but also cross-division job rotation. Job transfer is carried out after consulting employees and according to the five principles of the Labor Standards Act and related labor regulations, without coercion of threat. 3. The company has formulated complete standard operating procedure for strict abidance by employees, on top of installation of complete emergency relief equipment, which is subject to regular inspection and renovation. The company arranges annual physical examination for employees, with extra check items for those engaged in special operations, to prevent potential health risks. 4. In line with the requirement of the new Occupational Safety and Health Act, drafted by the Occupational Safety and Health Act, the Ministry of Labor, the company has offered comprehensive care for female employees, avoiding late-night shift (10:00 p.m.-6:00 a.m.) for pregnant ones and having in-house health specialists to conduct preliminary risk assessment for them, to safeguard their and children's health and safety and uphold their work right. 5. High regard for human rights also reflects in the supplier management, as suppliers are required to comply with conventions and regulations upholding human rights, both in Taiwan and abroad. Under the management mechanism, there has yet to be human-rights cases which influence the company's operation. Meanwhile, a corporate culture stressing mutual respect, human-based management, and multiple communications channels have combined to minimize discriminatory incidents or labor- management disputes, leading to a harmonious workplace.
(2) Has the Company established appropriately managed employee welfare measures (include salary and compensation, leave and others), and link operational performance or achievements with			1. The company has formulated reasonable compensations and performance-evaluation system and management measures, according to which salaries are set according to employees' education, experience, professional knowledge, skill, and seniority. In addition to year-end bonus and dividend sharing, extra bonus is paid out according to the result of performance evaluation. Levels of compensations are not affected by such factors, as gender, race, religion, marital status, and political standpoint.	None

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Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Deviations from “Corporate Social Responsibility(CSR) Best Practice Principles of TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Explanation
employee salary and compensation?			2. The company's article of incorporation stipulates that if profitable, the company should appropriate no less 2% of the year's profits as employee compensations, 2020 employee compensation approved by board of directors is NT$24,651,373 for 2019, according to resolution of the board of directors. The compensations were distributed, according to the results of employees' performance evaluation, with some receiving some pay hike, in acknowledgement of their extraordinary performance.
(3) Does the Company provide a healthy and safe working environment and organize training on health and safety for its employees on a regular basis?			1. The company and affiliates regard highly labor- management relationship, providing employees a comfortable, safe, and healthy workplace with complete hardware and software, including necessary access control measures regular labor safety education and training, indoor smoking ban, breastfeeding room, in-house restaurant, and free laundry for production-line workers. 2. With high regard for employee and contractor safety, the company and affiliates hold, without alert, evacuation and emergency response drill, twice at least for the latter. Moreover, all the employees must undertake fire-fighting and first- aid drills, on top of monthly safety promotion and drill held by various units, meeting the requirement of at least three hours of on-the-job training for occupational safety and health a year. 3. To help new employees blend into the company's safety culture, they are required to take at least three yours of safety and hygiene training, with additional three yours of production safety and hygiene training for those for production lines. 4. For employee's good health, the company and affiliates hold physical examination for new employees and annual physical examination for existing ones, on top of institution of infirmary, one health specialist (with nurse license), and consulting of outside doctors at fixed times. The company also holds various health-related programs, including smoke quitting, weight loss, and exercise. 5. The company and affiliates have strived to create good environment for employees' career development and instituted an effective plan for cultivation of career capabilities. Meanwhile, for employee welfare and optimal working environment, the company, in addition to various family events, holds "employee well-being month" series activities, mostly in the aspects of family life and spiritual enrichment, so that employees can not only work securely but also live happily.	None

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Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Deviations from “Corporate Social Responsibility(CSR) Best Practice Principles of TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Explanation
(4) Has the Company established effective career development training plans?			In ScinoPharm, every employee has opportunities to demonstrate their talent. A corporate culture encouraging innovation can inspire the potential of employees to the utmost level, tackling various challenges. Along with a global deployment, we provide employees multiple development opportunities, via job rotation, systematic performance evaluation, and career-development assessment, supplemented by personal development plans and training courses, offering a wide stage for performance by employees. Under such a system, employees can develop expertise in a wide range of fields, including R&D, production, quality control, business development, and logistics, capable of handling managerial responsibilities. Over 80% of the company's managers and higher ranking officials have ascended to their posts via internal cultivation and promotion. The company has taken plans in cultivating international talent. To meet the needs of talent development and business management, the company has instituted professional management courses from the outset, helping unit chiefs at various levels to develop managerial capability. Meanwhile, on the basis of vocational capability system, the company also plans learning and development roadmap for the core job capabilities of common employees, so that they can attain betterperformance.	None
(5) Does the Company's product and service comply with related regulations and international rules for customers' health and safety, privacy, sales, labelling and set polices to protect consumers' rights and consumer appeal procedures?			1. The company offers customers after-sales service helping them solve problems connected with production process or product quality. 2. Assist customers in replying to the questions raised by the regulator when using the products of the company or affiliates in registration. 3. All of the company's products conform to medical laws/regulations of various countries. In addition to compliance with related laws/regulations and international criteria in marketing and labeling, the company selects credible, honest, and reliable agents for its products and services, licensing them to carry out marketing of various products and forming a firm relationship with them gradually. Meanwhile, to uphold customers' interests, the company has set up various communications channels, such as e-mail replyingto inquiries within 24 hours.	None
(6) Does the Company set supplier management policy and request suppliers to comply with related standards on the topics of environmental,			1. To assure product safety and service quality, the company also forms procedure for auditing suppliers to make sure they can provide the goods safely. ScinoPharm formulated “Rules for Consultants and Suppliers” process procedure to regulate relevant matters. Also formulated “Suppliers Audit Procedures. The suppliers currently are categorized to: raw material suppliers,non-raw material suppliers,	None

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Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Deviations from “Corporate Social Responsibility(CSR) Best Practice Principles of TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Explanation
occupational safety and health or labor right, and their implementation status?			transportation businesses who offer transportation services and contractors who help executing relevant works. 2. In purchasing chemical materials, in addition to request suppliers providing latest-edition materials safety data sheet, it is also mandatory to display conspicuous hazard label for materials. In addition. Complying with the government's requirement for management of controlled materials (including toxic substance), for avoiding mistaken use, the company and suppliers will both seek government permits for sale and purchase, before the deal is settled. 3. For collaborative firms, the company evaluates and selects contract manufacturers capable of meeting its management requirements, to assure their capability in handling product and process hazards safely. The company also screens and selected waste treatment firms capable of meeting the company's management requirements, to assure wastes can be treated correctly and safety. 4. The company and affiliates have established rules for selecting contractors, contractor evaluation measures, and contractor punishment rules, on top of periodic meetings for reviewing contractor safety, for constant improvement of safety and hygiene management performance, to assure conformance of contractors to laws/regulations and the company's requirements on safety and hygiene, in terms of personnel, equipment, and entry of materials into the company. 5. The company has publicized "manual on contractor safety, hygiene, and environmental protection management plan," specifying ScinoPharm's safety, hygiene, and environmental-protection policy, which includes contractor liabilities and obligations, safety work rules, safety and hygiene punishment rules, and environmental-protection commitment, to assure public safetyand avoid environmentalpollution.
5. Does the company reference internationally accepted reporting standards or guidelines, and prepare reports that disclose non- financial information of the company, such as corporate social responsibility reports? Do the reports above obtain assurance from a			In compiling CSR report, the company follows the regulations of "measures governing compilation and declaration of CSR report by TWSE-listed companies" and Global Reporting Initiative (GRI), using their core items in identifying, executing, and disclosing ScinoPharm Taiwan's related strategy and concrete measures, plus identification of issues concerned by stakeholders via questionnaire and systematic data analysis, as basis for report compilation. A comparison table for related sections and chapters is available in appendix, facilitating rapid retrieval and inquiry. Statistics contained in the report derive from self- calculation and survey result of ScinoPharm Taiwan, including financial statistics, denominated in NT dollar,from annual financial statement	None

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Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Deviations from “Corporate Social Responsibility(CSR) Best Practice Principles of TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Explanation
third party verification unit?			certified by PwC, which also executed limited assurance for the report, according to No. 1 assurance standard on "auditing or perusal of assurance cases for non-historical financial information," issued by Accounting Research and Development Foundation in Taiwan.
6. If the Company has established the corporate social responsibility principles based on “the Corporate Social Responsibility Best-Practice Principles for TWSE/TPEx Listed Companies”, please describe any discrepancy between the Principles and their implementation: The Company passed the formulation of its “Corporate Social Responsibility Best Practice Principles” at its board of directors held on June 18, 2014, and revised the principles on March 25, 2015, December 20, 2016. For details about the operating situation and concrete practices associated with the Company’s corporate social responsibility, please see the instructions on the “Fulfillment of Corporate Social Responsibility” as seen in this annual report, and access the “Corporate Social Responsibility” section of the Company’s website at http://www.scinopharm.com.tw/Responsibility.asp.Following an evaluation, the Company finds little discrepancy between its corporate social responsibility fulfilment situation and the relevant principles set by the Company.
7. Other key information conducive to understanding the operating status of CSR: ScinoPharm has demonstrated its commitment to corporate governance and CSR with concrete actions. The company has sent on its own initiative its CSR report to third-party fair unit for limited assurance voluntarily. ScinoPharm has regarded highly on employees' health, helping them balance work and life, upholding their equal work rights, regardless of gender, nationality, and age. Along with the quest for business development, the company has been actively striving for medical progress for humanity. ScinoPharm has joined hands with foreign partners in investing in various orphan-drug development plans, in the hope of offering poor and underprivileged people better medical resources. In environmental protection and energy consumption, ScinoPharm has been engaged in energy conservation and carbon abatement continuously, as well as constant review and optimization of existing process, reducing use of solvent for some products, on the one hand, and raising the percentage for the use of recycled organic solvent, on the other hand. The company farms out disposal of other wastes to contracted waste treatment firms and audits their operating method and outlet of wastes periodically. For a long time, ScinoPharm Taiwan has complied with corporate ethical norms, upheld customers' interests, and regarded communal relationship highly, including provision of giveback, in order to fulfill its social responsibilities, with implementation status listed as follows: (1) Environmental Protection: The Company actively participates in the united management mechanism for safety, health and environmental protection operations in the Southern Taiwan Science Park, and promotes internal energy, power and water conservation campaigns, while also complying with the government’s environmental protection policy by actualizing the recycling of garbage resources to boost the use of recycled substances with lower impact on the environment. The Company’s other internal environmental protection measures include: retrieving the condensate emissions from the reverse osmosis water machines and air conditioners to cooling towers for re- utilization, and adopting water-saving faucets to reduce daily use of water. (2) Social exchanges: Support domestic excellent artists, in the hope of pushing public-art events. ScinoPharm has been sponsoring the Aaeon Foundation, with annual funding of NT$25,000, in organizing domestic artistic exhibitions for 11 years. With high regard on balance between work and life, ScinoPharm encourages employees to take good care of their career and family at the same time, in the hope that they can work hard on the one hand and enjoy life on the other. Despite the raging COVID-19 pandemic, the company continued to hold series lectures on arts in 2020, for the 12th consecutive year, in virtual form, though, with the theme of "change starting from oneself," inviting Yeh Ping-chen, professor of National Taiwan University, Yeh Yang, vice president for business of Google Taiwan, Liu Kuan-yin, magazine publisher to share with audience in Southern Taiwan Science Park their insights and personal experience. The event attracted 50,000 viewer/times. (3) Community Welfare: For years, ScinoPharm has been actively seeking a friendly relationship with neighboring communities, such as provision of communal giveback. In 2020, under the auspices of "loving month" event of Southern Taiwan Science Park, the company made donations for communal services. Amid the COVID-19 pandemic, the company gave employees anti-pandemic products, including essential-oil soap, hand sanitizer, hygienic towelette, and mask.

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Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Deviations from “Corporate Social Responsibility(CSR) Best Practice Principles of TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Explanation
(4) Emergency Relief: Every year encourage employees donate blood to alleviate blood shortage at local hospitals, In addition, the Company participated in a program organized by Uni-President Enterprises Group donating secondhand clothes, to help poor families’ weather chilly winter. (5) Assistance in Promoting Exchanges Between Academic and Industrial Sectors: The Company sets up “ScinoPharm Thesis Scholarship” in cooperation with the Chemical Society Located in Taipei, and actively sponsors seminars held by biotech and chemical engineering departments of domestic universities and colleges. In addition, ScinoPharm also arranges tours of the Company by students to make them better understand the pharmaceutical industry and help cultivate talents. Provide NT$100,000 in sponsorship a year to make students better understand the pharmaceutical industry, help cultivate talents and help students understand the industry (6) Social Contributions: The Company endeavors to create investment gains for shareholders and fully assume its corporate social responsibility. In addition, the Company shows high regard for the interests of employees and follows the Labor Standards Act to create job opportunities, hiring over 630 employees. Except helping local students enter the job market, took part in the talent recruitment events held at the campuses of National Taiwan University, National Cheng Kung University, and Academia Sinica, also providing internships to students from seven universities, facilitating job preparation by students and cultivation of industrial talents.

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3.4.6 Ethical Corporate Management

Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Deviations from the Ethical Corporate Management Best Practices Principles for TWSE listed companies and reasons
	Yes	No	Abstract Illustration
1. Establishment of ethical corporate management policies and programs (1) Whether or not the company has formulated ethical-management policy, which has been approved by the board of directors and has specified explicitly in corporate regulations and publicized documents ethical-management policy and practices, as well as commitment of the board of directors and executives on implementation of ethical- management policy?			In order to deepen integrity-based management culture and to further strengthen business development, the board of directors formulated a set of “Code of Business Integrity” on December 9, 2010, which was further amended on March 26, 2012 and August 4, 2015, respectively, and consequently posted on the Market Observation Post System (MOPS) of the Taiwan Stock Exchange, as well as on the Company’s website. The Company also sets up relevant internal operating standards and control systems to examine all aspects of business operations on a fixed-time basis, and then deliver the inspection results to the Board for approval. This practice not only serves as the basis for the implementation of the integrity management, but also highlights the Company’s policy and tactics as well as the commitment of its Board and management to realize integrity policy. Related information on the integrity management has also been disclosed in other outgoing documents, including the corporate social responsibility report.	None
(2) Whether or not the company has established assessment mechanism for unethical-conduct risks for periodic analysis and assessment of business activities with higher unethical-conduct risks, as basis for formulating program preventing unethical conducts, which contains preventive measures for various conducts listed in item of article 7 of "Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies" at least.			Based on "Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies" and "Sample Template for XXX Co., Ltd. Procedures for Ethical Management and Guidelines for Conduct," the company has asked directors, managers, employees, fiduciaries, and people with actual control power to prevent bribery and illegal political donations during the process of business activities, on top of banning giving or taking any improper gifts, treatment, or other improper interests, so as to ward off sacrificing corporate interests for the sake of personal interests. The company has installed "stakeholder" section, as communications channel between the company and stakeholders, and "reporting system for unethical conducts" on corporate website, to highlight the company's core ethical value and determination in legal compliance.	None
(3) Whether or not the company has specified in program preventing unethical conducts operating procedure, guidelines for conduct, punishments for violation, and appeal system, which have been implemented faithfullyand			The company has formulated "ethical corporate management best practice principles," "procedures for ethnical management and guidelines for conduct," "guidelines for ethical conduct," and "guidelines for employee conduct," offering detailed regulations on employee conducts. In addition, based on "Ethical Corporate Management Best Practice Principles for	None

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Evaluation Item			Implementation Status	Deviations from the Ethical Corporate Management Best Practices Principles for TWSE listed companies and reasons
	Yes	No	Abstract Illustration
subject to periodic review and revision?			TWSE/GTSM Listed Companies," the company has been preventing possible unethical conducts, on top of highlighting the importance of ethical conduct via e-mails, posts on corporate website, and orientation for new employees, so as to give employees clear guidelines in dealing with colleagues, customers, suppliers, and social public and avoid conflict of interests and improper gains. Such requirements have been incorporated into evaluation system for employee performance, to assure implementation of ethical management. Reporting system for suspected breach of the requirements, as well as punishment rules, a have been available.
2. Fulfill operations integrity policy (1)Does the Company evaluate business partners’ ethical records and include ethics- related clauses in business contracts?			The Company has set up a filing system to manage the relationships with its contractors and has also been evaluating the integrity of its clients and suppliers through their credit lines and other appraisal systems in order to prevent untrustworthy activities from happening. The Company also stipulates integrity provisions in the contracts it signs with corresponding contractors. Should the contents violate the article of "integrity- oriented management," the Company can terminate or revoke the contract.	None
(2)Does the Company establish an exclusively (or concurrently) dedicated unit supervised by the Board to be in charge of corporate integrity?			1. The company has designated legal affairs, human resources, procurement, and financial units as units for pushing ethical management, responsible for publicizing ethical management-related laws/regulations and operating procedure and ethical- management policy, supervision of prevention of unethical conducts, operation of reporting system. Those units formulate and execute annual plans for operations under their charge, integrate and review the execution, explanation, and consulting of programs on ethical management and unethical-conduct prevention of the company and various units. Those practices and results in 2020 were summarized was presented in the meeting of the board of directors on November 6th2020. 2. The following is brief description of ethical management-related practices in 2020: (1) Education and training In addition to arrangement for directors attending related external training courses and lectures, the company has also been holding internal and external education and training on ethical management, including legal compliance for ethical management, GMP, accounting system, and internal control system,some of whose attendees	None

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Evaluation Item			Implementation Status	Deviations from the Ethical Corporate Management Best Practices Principles for TWSE listed companies and reasons
	Yes	No	Abstract Illustration
			had to take test afterward, to augment their extent of understanding. The internal and external training courses related with ethical management (including legal compliance for ethical management, GMP, accounting system and internal control system) for 2020, attendance for those courses are 6,901 person/times, totaling 31,778hours. (2) Periodic review: In addition to constant evaluation and review of business activities with higher risks of unethical conducts by various units themselves, the company's auditing office inspects compliance of related systems periodically, to assure effective operation of the entire mechanism. In 2020, no cases involving breach of ethical management were found. (3) Reporting system: To facilitate reporting of suspected breach of laws and regulations, the company has instituted employee communication mail box and protective measures for informants, as specified in "guidelines for employee conducts," on top of "stakeholder" section on corporate website and a "reporting system for unethical conducts," as contact window and reporting channel for stakeholders. There was no such report in 2020.
(3)Does the Company establish policies to prevent conflicts of interest and provide appropriate communication channels, and implement it?			The company has formulated policy avoiding conflict of interests, so as to identify, supervise, and manage risk of dishonest behaviors associated with conflict of interests, while offering proper channel for directors, managerial staffers, and other interested parties present at the meeting of the board of directors to explain on their own the existence of conflict of interests between them and the company. For cases with related interests for themselves or juridical persons they represent, the company's directors, managerial staffers, and other interested parties present at the meeting of the board of directors should explain the major contents of the related interests and abstain, should there exist possible harm to the company's interests, from discussion and voting or represent other directors in the exercise of their voting right. Directors should also avoid rendering mutual support, in exhibition of self- discipline.	None

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Evaluation Item			Implementation Status	Deviations from the Ethical Corporate Management Best Practices Principles for TWSE listed companies and reasons
	Yes	No	Abstract Illustration
(4)Has the Company established effective systems for both accounting and internal control to facilitate ethical corporate management, and are they audited by either internal auditors or CPAs on a regular basis?			The company has instituted effective accounting system and internal control system, on top of constant evaluation and review of business activities with higher risks of unethical conduct and periodic inspection of compliance of related systems by auditing office for compilation of report submitted to the board of directors. To assure their continuing effectiveness in the design and execution, related systems are reviewed and revised annually, to ensure a good corporate governance and risk control mechanism, as basis for evaluating the effectiveness of overall internal control system and compiling statement on internal control system, to be audited by certified public accountant, when necessary, or other related professional.	None
(5)Does the Company regularly hold internal and external educational trainings on operational integrity?			The company arranges job-related mentoring and education and training, as well as opportunities for practices, to facilitate career development of employees, plus provision of multiple learning channels and resources, including on-the-job training, classroom training, GMP and laws/regulations, and online learning courses on the company's related measures. In 2020, attendance for internal and external ethical management-related education and training (including courses on compliance with related laws/regulations, GMP, accounting system, and internal control) hit 6,901person/times,totaling31,778 hours.	None
3. Operation of the integrity channel (1)Does the Company establish both a reward/punishment system and an integrity hotline? Can the accused be reached by an appropriate person for follow-up?			The Company has established adequate channels to encourage the reporting of suspected illegal conducts or violations of related stipulations set forth in the “Code of Business Integrity,” “Operating Procedures and Guidelines for Integrity Management,” “Code of Ethics” and “Code of Conduct” as a means to safeguard the spirit of integrity management. While all employees are able to submit their opinions through “Employee Communication Box,” the Company has also set aside special columns “Stakeholders” and “Unethical Behavior Reporting System" on its website, enabling employees and relevant personnel to report suspected illegal and unethical conducts, with which the Company will assign appropriate staff from the administration, human resources, legal and related departments to jointly address alleged issues.	None

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Evaluation Item	Implementation Status	Implementation Status	Implementation Status	Deviations from the Ethical Corporate Management Best Practices Principles for TWSE listed companies and reasons
	Yes	No	Abstract Illustration
(2)Does the Company establish standard operating procedures for confidential reporting on investigating accusation cases?			The Company will approach all of reported cases and follow-up investigations with extremely confidential and stringent attitude based on standard procedures and secrecy mechanism conforming to internal rules and regulations.	None
(3)Does the Company provide proper whistleblower protection?			Personal data provided by informants, unless otherwise stipulated by law, the Company will be kept the data confidentially and take appropriate protective measures in accordance with laws to safeguard personal information and privacy of informants so as to prevent these persons from receiving retaliation and unfair treatment.	None
4. Strengthening information disclosure Does the Company disclose its ethical corporate management policies and the results of its implementation on the Company’s website and MOPS			The Company’s “Code of Business Integrity” has been uploaded to “Market Observation Post System (MOPS), as well as on the “Investors” column of corporate website, allowing all employees and general public to make inquiries at any time. Additionally, related information pertaining to business integrity has also been disclosed in the annual reports and corporate social responsibility reports posted on the MOPS and corporate website.	None
5. If the Company has established the ethical corporate management policies based on the Ethical Corporate Management Best-Practice Principles for TWSE/TPEx Listed Companies, please describe any discrepancy between the policies and their implementation. In accordance with the rules set on the “Rules for Business Integrity by Listed Companies,” the Company has set up and promulgated “Code for Business Integrity,” “Operating Procedures and Guidelines for Integrity Management,” “Administrative Rules on Transaction with Stakeholders, Designated and Associated Companies,” “Operating Procedures for Major Internal Information,” “Code of Self-Discipline for Disclosing Acquisition Information,” “Code of Ethics,” and “Code of Conduct.” In addition to requiring relevant departments and all of employees to follow these rules, the Company has also asked its subsidiaries to abide the spirit of integrity policy set forth by the parent company and to implement related regulations. Overall, the practice of business integrity and the law-abiding requirement for subsidiaries are identical to the parent company.
6. Other important information to facilitate a better understanding of the Company’s ethical corporate management policies. While operating the Company in accordance with related laws and regulations, the Company also periodically holds courses pertaining to corporate governance, insider trading management and code of conducts for employees, as well as irregularly dispatches relevant units to participate in related courses including taxation, legal risk and corporate governance to promote business integrity and morality. The Company has also been upholding the highest standards to promote the use of principles of honest, trustworthy and transparency to engage in business activities so as to protect the interest of stakeholders and deepen the spirit of business integrity into corporate ethics and culture for ramping up reputation and sustainable growth. Coping with changing management environment, the Company also reviews and amends related rules, operating procedures and guidelines for integrity management in order to meet legal requirements and expectations of stakeholders.

In accordance with the rules set on the “Rules for Business Integrity by Listed Companies,” the Company has set up and promulgated “Code for Business Integrity,” “Operating Procedures and Guidelines for Integrity Management,” “Administrative Rules on Transaction with Stakeholders, Designated and Associated Companies,” “Operating Procedures for Major Internal Information,” “Code of Self-Discipline for Disclosing Acquisition Information,” “Code of Ethics,” and “Code of Conduct.” In addition to requiring relevant departments and all of employees to follow these rules, the Company has also asked its subsidiaries to abide the spirit of integrity policy set forth by the parent company and to implement related regulations. Overall, the practice of business integrity and the law-abiding requirement for subsidiaries are identical to the parent company.

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3.4.7 Corporate Governance Guidelines and Regulations

To enhance risk control mechanism and to comply with the spirit of corporate governance, as well as to cope with the listing of the Company’s shares on the stock market and the formulation and amendment of rules and regulations by relevant governing agencies, the Company has also successively drawn or amended a number of sets of rules and guidelines, including “Processing Procedures for Acquisition and Disposal of Assets”, “Operating Procedures for Providing Endorsement and Guarantee”, “Operating Procedures for Lending Funds to Others”, “Rules of Procedure for Shareholders’ Meeting”, “Rules of Procedure for Board of Directors Meeting”, “Rules of Governing Election of Directors”, “Rules on Terms of Reference for Independent Directors,” “Audit Committee Charter”, “Regulations for Organization of Compensation committee”, “Self-discipline for Revealing Acquisition Information”, “Rules for Transaction among Stakeholders, Designated Companies and Corporate Groups”, “Code of Business Integrity”, “Operating Procedures and Guidelines for Business Integrity”, “Code of Ethics”, “Code of Conduct”, “Operating Procedures for Processing Major Internal Information”, “Practical Guidelines for Corporate Governance” and “ Practical Guidelines for Corporate Social Responsibility” as well as complete internal control and auditing systems. All related rules and regulations have been posted on the MOPS and corporate website. For related information, please check with the Company’s web: www.scinopharm.com.tw via Investors/Corporate Governance/Major Ruling or Code of Ethics.

3.4.8 Other Important Information Regarding Corporate Governance

• 3.4.8.1. While integrity is the fundamental of the Company, the establishment of a working environment based on pluralism, equality, mutual trust and respectfulness has also been the Company's business philosophy. Thus, the formulation of “Code for Business Integrity,” “Operating Procedures and Guidelines for Integrity Management,” “Code of Ethics,” and “Code of Conduct” will enable high-level management and all of employees to understand related laws and rules they have to abide and the ethics they have to put into practice during their work, and to realize the Company’s expectations on behavior of its employees, cooperation partners and suppliers. These are not only the bases for senior management and all of colleagues to conduct their behavior, but will also help lift up the quality of behavior and professional ethics, which will be instrumental to sustainable growth and future development of the Company.

• 3.4.8.2. To enable employees to reveal suspected violated conducts through appropriate channels, the Company has set a communication box and related protection measures. More information can be found at the Company’s website: www.scinopharm.com.tw, to see related regulations from the special column Investors/Corporate Governance/Code of Ethical Conduct/Code of Conducts. Additionally, in order to establish an open, transparency and effective communication channel with stakeholders to understand the demand of each side, and to be used as reference to formulate the policy and activities for carrying out corporate social responsibility, the Company sets up a special “Stakeholders” column on its website, attached with a “Reporting System for Violating Code of Ethics” providing stakeholders with an adequate communication and reporting channel. For more information, please see the “Stakeholders’ section at www.scinopharm.com.tw.

• 3.4.8.3. To continue enriching related information on corporate governance for advanced study, the Company also takes the initiation to inform all members of its directors and independent directors to arrange courses. In 2020, 15 directors and independent directors attended such courses, whose curricular are listed below. The training complies with the ruling of “Key Points for Promoting Advanced Studies by Directors, Supervisors of Listed Companies.”

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2020 Directors’ and Independent Directors’ training records

								As of 12/31/2020	As of 12/31/2020
Item	Title	Name	Study period		Sponsoring Organization	Course	Training hours	2020 Training total hours	Is training record fulfill the requirement
			From	To
1	Institutional Shareholder Representative	Chih-Hsien Lo	2020.05.07	2020.05.07	Taiwan Corporate Governance Association	Corporate prevention of corruption--case study	3	12	Yes
			2020.07.24	2020.07.24	Taiwan Institute of Directors	Business group governance and performance management	3
			2020.08.11	2020.08.11	Taiwan Corporate Governance Association	Response and application of the board of directors to corporate-governance evaluation	3
			2020.10.23	2020.10.23	Taiwan Institute of Directors	The advent of digital-economy era--how can enterprises cope with the challenge of talent transformation in the next 10 years	3
2	Institutional Shareholder Representative	Tsung-Ming Su	2020.07.15	2020.07.15	Independent Director Association Taiwan	Post-pandemic corporate growth, restructuring, or transformation/upgrading	3	27	Yes
			2020.07.21	2020.07.21	Independent Director Association Taiwan	Critical lines of defense for independent directors in grasping risks in financial statements	3
			2020.07.22	2020.07.22	Taiwan Academy of Banking and Finance	Workshop on corporate governance and sustainable management	3
			2020.08.12	2020.08.12	Independent Director Association Taiwan Association	Role of independent directors in corporate government and management-right dispute	3
			2020.09.04	2020.09.04	Taiwan Corporate Governance Association	Practices of the operation of the functional committees of the board of directors	3
			2020.09.08	2020.09.08	Taiwan Corporate Governance Association	Fight for management right-- case study	3
			2020.09.11	2020.09.11	Taiwan Corporate Governance Association	Case study on corporate governance--corporate culture and shareholder activism	3
			2020.09.18	2020.09.18	Taiwan Corporate Governance Association	Role of institutional investors in promotion of corporate governance	3
			2020.10.23	2020.10.23	Taiwan Institute of Directors	The advent of digital-economy era--how can enterprises cope with the challenge of talent transformation in the next 10 years	3
3	Institutional Shareholder Representative	Kun-Shun Tsai	2020.07.24	2020.07.24	Taiwan Institute of Directors	Business group governance andperformance management	3	6	Yes
			2020.10.23	2020.10.23	Taiwan Institute of Directors	The advent of digital-economy era--how can enterprises cope with the challenge of talent transformation in the next 10 years	3
4	Institutional Shareholder Representative	Tsung-Pin Wu	2020.05.07	2020.05.07	Taiwan Corporate Governance Association	Corporate prevention of corruption--case study	3	9	Yes
			2020.07.24	2020.07.24	Taiwan Institute of Directors	Business group governance and performance management	3
			2020.10.23	2020.10.23	Taiwan Institute of Directors	The advent of digital-economy era--how can enterprises cope with the challenge of talent transformation in the next 10 years	3

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Item	Title	Name	Study period	Study period	Sponsoring Organization	Course	Training hours	2020 Training total hours	Is training record fulfill the requirement
			From	To
5	Institutional Shareholder Representative	Fu-Jung Lai	2020.01.15	2020.01.15	Taiwan Institute of Directors	International theme salon: 2020 outlook for corporate governance and sustainability	3	17.5	Yes
			2020.01.16	2020.01.16	Institute for Information Industry	Perfection of corporate governance framework with intellectual-property management	2.5
			2020.05.19	2020.05.19	Accounting Research and Development Foundation	Strengthening ability for compiling financial statement: internal control, internal auditing, and information technology	3
			2020.07.24	2020.07.24	Taiwan Institute of Directors	Business group governance and performance management	3
			2020.08.28	2020.08.28	Taiwan Corporate Governance Association	Fight for management right-- case study	3
			2020.10.23	2020.10.23	Taiwan Institute of Directors	The advent of digital-economy era--how can enterprises cope with the challenge of talent transformation in the next 10 years	3
6	Institutional Shareholder Representative	Jia-Horng Guo	2020.04.16	2020.04.16	Independent Director Association Taiwan	Analysis of the policy enhancing corporate capability for compiling financial statement and study on internal-auditing and -control practices	3	6	Yes
			2020.09.10	2020.09.10	Taiwan Academy of Banking and Finance	Workshop on financial consumer protection act and fair customer treatment principle Review of and outlook for risk control for money-laundering prevention	3
7	Institutional Shareholder Representative	Ming-Chuan Hsieh	2020.08.28	2020.08.28	Taiwan Corporate Governance Association	Trend of taxation management for business groups in post- pandemic era	3	6	Yes
			2020.08.28	2020.08.28	Taiwan Corporate Governance Association	Fight for management right-- case study	3
8	Institutional Shareholder Representative	Ya-Po Yang	2020.09.25	2020.09.25	Securities and Futures Institute	2020 Sessions on legal abidance by insiders of listed companies for trading in equity	3	6	Yes
			2020.11.13	2020.11.13	Securities and Futures Institute	2020 session on promotion of corporate governance and ethical management for directors and supervisors	3
9	Institutional Shareholder Representative	Shiow-Ling Kao	2020.05.07	2020.05.07	Taiwan Corporate Governance Association	Corporate prevention of corruption--case study	3	6	Yes
			2020.07.24	2020.07.24	Taiwan Institute of Directors	Business group governance and performance management	3
			2020.08.11	2020.08.11	Taiwan Corporate Governance Association	Response and application of the board of directors to corporate-governance evaluation	3

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Item	Title	Name	Study period	Study period	Sponsoring Organization	Course	Training hours	2020 Training total hours	Is training record fulfill the requirement
			From	To
			2020.10.23	2020.10.23	Taiwan Institute of Directors	The advent of digital-economy era--how can enterprises cope with the challenge of talent transformation in the next 10 years	3
10	Institutional Shareholder Representative	Chiou-Ru Shih	2020.07.22	2020.07.22	Securities and Futures Institute	Analysis of and response to international taxation trend under new edition of corporate governance blueprint	3	9	Yes
			2020.07.24	2020.07.24	Taiwan Institute of Directors	Business group governance and performance management	3
			2020.10.23	2020.10.23	Taiwan Institute of Directors	The advent of digital-economy era--how can enterprises cope with the challenge of talent transformation in the next 10 years	3
11	Institutional Shareholder Representative	Po-Ming Hou	2020.05.07	2020.05.07	Taiwan Corporate Governance Association	Corporate prevention of corruption--case study	3	21	Yes
			2020.06.05	2020.06.05	Taiwan Institute of Directors	Challenges and opportunities of corporate governance amid a changing market	6
			2020.07.24	2020.07.24	Taiwan Institute of Directors	Business group governance and performance management	3
			2020.08.11	2020.08.11	Taiwan Corporate Governance Association	Response and application of the board of directors to corporate-governance evaluation	3
			2020.10.23	2020.10.23	Taiwan Institute of Directors	The advent of digital-economy era--how can enterprises cope with the challenge of talent transformation in the next 10 years	3
			2020.11.10	2020.11.10	Taiwan Corporate Governance Association	Corporate governance and securities laws/regulations -- starting from evaluation indicators for corporate governance	3
12	Institutional Shareholder Representative	Kuo-Hsi Wang	2020.11.04	2020.11.04	Taiwan Corporate Governance Association	Disclosure of key corporate information and the responsibilities of directors and supervisors	3	6	Yes
			2020.11.04	2020.11.04	Taiwan Corporate Governance Association	How can directors and supervisors help with handling of corporate crisis?	3
13	Independent Director	Wei-te Ho	2020.11.10	2020.11.10	Taiwan Corporate Governance Association	Corporate governance and securities laws/regulations -- starting from evaluation indicators for corporate governance	3	6	Yes
			2020.11.13	2020.11.13	TWSE	2020 session on promotion of corporate governance and ethical management for directors and supervisors	3
14	Independent Director	Wen-Chang Chang	2020.09.21	2020.09.21	TWSE	Agenda of summit forum on "corporate governance 3.0-- sustainable development blueprint" for listed firms	3	6	Yes
			2020.10.14	2020.10.14	Securities and Futures Institute	2020Sessions on legal abidance by insiders of listed companies	3
15	Independent Director	Li-Tzong Chen	2020.08.28	2020.08.28	Taiwan Corporate Governance Association	Trend of taxation management for business groups in post- pandemic era	3	6	Yes
			2020.08.28	2020.08.28	Taiwan Corporate Governance Association	Fight for management right-- case study	3

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• 3.4.8.4. In order to instill correct concept about corporate governance in managerial staffers, the Company has been continuously arranging attendance of courses, held by external units, on corporate governance by managerial staffers, in order to attain the materialization of sound corporate governance. List of such courses attended by the Company's managerial staffers follows:

2020 Executive Offices’ training records

								As of 2020/12/31 2018 Training total hours Is training record fulfill the requirement 15 Yes 15 Yes 9 Yes 12 Yes	As of 2020/12/31 2018 Training total hours Is training record fulfill the requirement 15 Yes 15 Yes 9 Yes 12 Yes
Item	Title	Name	Study period		Sponsoring Organization	Course	Training hours	2018 Training total hours	Is training record fulfill the requirement
			From	To
1	Vice President Administration	Li-An Lu	2020.07.24	2020.07.24	Taiwan Institute of Directors	Business group governance and performance management	3	15	Yes
			2020.08.27	2020.08.27	Taiwan Institute of Directors	Study on corporate governance-related regulations: using money- laundering and insider-trading prevention as examples Scramble for key talent for the future	3
			2020.10.23	2020.10.23	Taiwan Institute of Directors	Save the future key talent: The advent of digital-economy era--how can enterprises cope with the challenge of talent transformation in the next 10 years	3
			2020.11.10	2020.11.10	Taiwan Corporate Governance Association	2020 outlook and challenge for AI in Taiwan Indispensable knowledge for directors and supervisors on the latest trend for corporate- governance	3
			2020.11.17	2020.11.17	Taiwan Corporate Governance Association	Indispensable knowledge for directors and supervisors on the latest trend for corporate- governance evaluation indicators: intellectual-property management	3
	Senior Director Accounting	Chih-Hui Lin	2020.08.27	2020.08.27	Accounting Research and Development Foundation	Class for advanced study for accounting chiefs of issuing securities firms and stock exchange	12	15	Yes
2			2020.09.21	2020.09.21	TWSE	Agenda of summit forum on "corporate governance 3.0-- sustainable development blueprint" for listed firms	3
3	Senior Director Finance	Chih-Ching Hsu	2020.09.03	2020.09.03	TWSE	2020 Sessions on legal abidance by insiders of listed companies fortradinginequity	3	9	Yes
			2020.10.27	2020.10.27	Taiwan Corporate Governance Association	ESG development trend and social-responsibility investment	3
			2020.11.13	2020.11.13	TWSE	2020 session on promotion of corporate governance and ethical management for directors and supervisors
4	Director Audit Office	Shun Yang Lin	2020.06.18	2020.06.18	The Institute of Internal Auditors- Chinese Taiwan	Drill for cases of Labor Incident Act	6	12	Yes
			2020.08.24	2020.08.24	The Institute of Internal Auditors- Chinese Taiwan	Analysis of the policy enhancing corporate capability for compiling financial statement and study on internal-auditing and -control practices	6

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3.4.9 Implementation Status of Internal Control System

3.4.9.1 Internal Control Declaration (translated from Chinese)

Statement of Internal Control System

Date: March 18, 2021

The internal control system from January 1 to December 31, 2020, according to the result of selfassessment is thus stated as follows:

1. The Company acknowledges that the implementation and maintenance of internal control system is the responsibility of Board of Directors and management, and the Company has established such system. The internal capital system is aimed to reasonably assure that the goals such as the effectiveness and the efficiency of operations (including profitability, performance and protection of assets), the reliability of financial reporting and the compliance of applicable law and regulations are achieved.

2. The internal control system has its innate restriction. An effective internal control system can only ensure the foregoing three goals are achieved; nevertheless, due to the change of environment and conditions, the effectiveness of internal control system will be changed accordingly. However, the internal control system of the Company has self-monitoring function and the Company will take corrective action once any defect is identified.

3. According to the effective judgment items for the internal control system specified in “Highlights for Implementation of Establishing Internal Control System by Listed Companies” (hereinafter referred to as “Highlights") promulgated by Securities and Futures Commission, Ministry of Finance R.O.C., the Company has made judgment whether or not the design and execution of internal control system is effective. The judgment items for internal control adopted by “Highlights” are, based on the process of management control, for classifying the internal control into five elements: (1) Control environment;(2) Risk assessments;(3) Control activities;(4) Information and communication; and (5) Monitoring. Each element also includes a certain number of items. For the foregoing items ， refer to “Highlights".

4. The Company has adopted the aforesaid judgment items for internal control to evaluate the effectiveness of design and execution of internal control system.

5. Based on the above-mentioned result of evaluation, the Company suggests that the internal control system, including the design and execution of internal control relating to the effectiveness and efficiency of operation, the reliability of financial reporting ， the compliance of applicable law and regulations has been effective and they can reasonably assure the aforesaid goals have been achieved.

6. This statement will be the main content for annual report and prospectus and will be disclosed publicly. If the above contents have any falsehood and concealment, it will involve in the liability as mentioned in Article20, 32, 171 and 174 of Securities and Exchange Law.

7. This statement has been approved by the meeting of Board of Directors on March 18, 2021, and those 15 directors in presence all agree at the contents of this statement.

ScinoPharm Taiwan, Ltd. Chairman: Chih Hsien Lo C.E.O.: Tsung Ming Su

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• 3.4.9.2 If the Company has commissioned external auditors to review the Company's internal control system, the external auditor's report should be disclosed: Not applicable.

3.4.10 Result of punishment inflicted on insiders for breach of regulations of internal control system which may have material influence on shareholders' equity or securities price : None.

3.4.11 Major Resolutions of Shareholders’ Meeting and Board Meetings

• 3.4.11.1 Major Resolutions and implementation status of 2020 Annual General Shareholders’ Meeting

One general shareholders meeting was convened in the fiscal year 2020 and up to the publish date of the annual report. The resolutions were summarized as follows.

(I) shareholders' meeting: 2020/06/30

• a. Adoption of Business Report and Financial Statements for 2019.

• Implementation status: Accepted the business reports and financial statements of year 2019: In accordance with the Company Law, all related financial information has been submitted to the government agency for review.

• b. Adoption of Proposed earnings distribution plan for fiscal year 2019.

• Implementation status: The Company was to distribute ： Cash dividend ： NT$0.27 per share. The Earning Distribution Record Date was set on 2020 07.31, and the Distribution Date was set on 2020.08.19.

• c. Proposed Amendments to the Article of Incorporation of the Company.

• Implementation status: Change of registration already made with the

  • competent authority within 15 days, in compliance with legal requirement, and approved by the Southern Taiwan Science Park Administration (approval letter No. 1090018396 on 2020.07.14, before posting of the revised regulations on the corporate website.

• d. Proposed Amendments to the Rules Governing Election of Directors and Supervisors of the Company.

• Implementation status: posting of the revised regulations on the MOPs and corporate website on 2020.07.01 and enforce the amended Regulations

• e. Proposed Amendments to the Rules of Procedures for Shareholders’ Meeting of the Company.

• Implementation status: posting of the revised regulations on the MOPs and corporate website on 2020.07.01 and enforce the amended Regulations

• f. Approved the proposal submitted at the 2020 annual general shareholders meeting to abolish the restrictions of non-compete clause for representative directors of the ninth session of Board of Directors.

• Implementation status: Put into force after resolution by the shareholders' meeting on 2020.06.30 and reported the competent authority for publication on the same day

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(II) Major Resolutions during the Board of Directors Meetings in 2020 and to the Publish Date of the Annual Report

Seven board meetings were convened in fiscal year 2020 and up to the publish date of the annual report. The major resolutions were summarized below.

(1) The twelfth meeting of the Ninth Term of Board of Directors (March 20, 2020)

• a. Approved the Company’s remuneration distribution plans for directors and employees for fiscal 2019.

• b. The Company’s performance bonus for Managing Directors and above for fiscal 2019.

• c. Approved business report and financial reports for fiscal 2019.

• d. Approved income distribution plan for fiscal 2019 ： Cash dividend NT$0.27 per share.

• e. Approved “Statement for Internal Control Systems” for fiscal 2019.

• f. Approved hiring for managerial positions.

• g. Approved hiring for consultant.

• h. Approved the Company’s evaluation results regarding the independence and suitability of the CPAs. The appointment of charter certified accountant and remuneration package.

• i. Approved the renewal contracts signed with financial institutions for longand short-term credit lines and the transaction amount for derivative financial products, and authorized the Company’s chairman to sign the deal.

• j. Approved to offer Letter of Comfort and guarantee for SciAnda (Changshu) Pharmaceuticals, Ltd. medium-term credit loan.

• k. Approved Proposed Amendment to the Articles of Incorporation of the Company.

• l. Approved Amendment to the Rules of Procedure for Board of Directors Meeting of the Company

• m. Approved the amendment to the Rules of Governing Election of Directors and Supervisors of the Company.

• n. Approved the amendment to the Rules of Procedures for Shareholders’ Meeting of the Company.

• o. Approved the proposed releases of prohibition on Directors (including Independent directors) in Shareholders’ Meeting 2020.

• p. Approved the date, location and agenda for holding of the 2020 annual general shareholders meeting and relevant operating procedures for acceptance of proposals submitted by shareholders who holds over 1% of outstanding shares

(2) The thirteenth meeting of the Ninth Term of Board of Directors (May 7, 2020)

• a. Approved the Company’s consolidated financial statement and Auditor’s report for the first quarter 0f 2020.

• b. Approved hiring for managerial positions.

• c. Approved amendments to Regulations for Organization of Compensation committee of the Company.

• d. Approved amendments to Audit Committee Charter of the Company

• e. Approved amendments to Key Points for Operation Governing the Compilation Flow for Financial Statement of the Company.

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• f. Approved amendments to Rules Governing Internal Control System of the Company.

• g. Approved amendments to Enforcement Rules for Internal Auditing of the Company.

• h. Approved the contract signed with financial institutions for increasing the transaction amount for derivative financial products and authorized the Company’s chairman to sign the deal.

(3) The fourteenth meeting of the Ninth Term of Board of Directors (June 30, 2020)

• a. Approved the proposal of 2019 cash dividend ex-dividend date and dividend payment date according to income distribution plan.

• b. Approved the additional budget for the engineering project of new warehouse building.

• c. Approved the sale of assets to related party.

• d. Approved the hiring for consultants.

• e. Approved the continuation of liability insurance policy for directors and key employees.

• f. Approved the amendments to the measures governing usage of seals

• g. Approved the abolishment of restrictions of non-compete clause for the Managers.

(4) The fifteenth meeting of the Ninth Term of Board of Director

(August 11, 2020)

• a. Approved the consolidated financial reports for the second quarter of 2020.

• b. Approved hiring for managerial positions.

• c. Approved the appointment of directors for invested company.

• d. Approved the case involving scrapping of inventories.

• e. Acknowledgement of disposal of stake in Foresee Pharmaceuticals Co., Ltd.

• f. Acknowledgement of disposal of stake in Foresee Pharmaceuticals Co., Ltd.

• g. Revision of "key points governing procedure for professional accounting judgments, accounting policy, and making changes in estimates".

• h. Approved the abolishment of restrictions of non-compete clause for the managers.

(5) The sixteenth meeting of the Ninth Term of Board of Directors

(November 6, 2020)

• a. Approved corporate social responsibility realization report (including corporate governance and integrity-based management).

• b. Approved the consolidated financial statement for the third quarter of 2020.

• c. Approved the revision of "measures governing employee rewards and punishment.

(6) The seventeenth meeting of the Ninth Term of Board of Directors

(December 18, 2020)

a. Approved hiring for subsidiary managerial position.

~77~

• b. Approved employees’ salary adjustment program for 2020(including managers). of ScinoPharm Taiwan, Ltd.

• c. Approved the 2020 business plan of ScinoPharm Taiwan, Ltd.

• d. Approved the Company’s audit planning of ScinoPharm Taiwan, Ltd. for 2020.

• e. Approved amendments to the “Audit Committee Charter” and “Rules on Terms of Reference for Independent Directors,” of the Company.

(7) The sixth meeting of the Ninth Term of Board of Directors (March 18, 2021)

• a. Approved the Company’s remuneration distribution plans for directors and employees for fiscal 2020.

• b. Approved the Company’s performance bonus for vice president and above for fiscal 2020.

• c. Approved business report and financial reports for fiscal 2020.

• d. Approved income distribution plan for fiscal 2020.The cash dividend to be distributed is NT$0.5 per share.

• e. Approved hiring for managerial positions

• f. Approved “Statement for Internal Control Systems” for fiscal 2020.

• g. Approved the Company’s evaluation results regarding the independence and suitability of the CPAs. The appointment of charter certified accountant and remuneration package.

• h. Approved the renewal contracts signed with financial institutions for longand short-term credit lines and the transaction amount for derivative financial products, and authorized the Company’s chairman to sign the deal.

• i. Approved to offer Letter of Comfort and guarantee for SciAnda (Changshu) Pharmaceuticals, Ltd. medium-term credit loan.

• j. Approved the amendments to the Rules of Procedure for Board of Directors Meeting of the Company.

• k. Approved the amendments to the Rules of Procedures for Shareholders’ Meeting of the Company.

• l. Approved the amendments to measures governing flow for the nomination of candidates for Directors

• m. Approved the 10[th] Election of Board of Directors (including independent directors.

• n. Approved the announcement o acceptance of Directors candidates nominated by shareholders with 1% or higher stake.

• o. Approved the proposed releases of Director’s (including Independent Directors) elected and their representatives from Non-Competition Restrictions in Shareholders’ Meeting 2021.

• p. Approved the date, location and agenda for holding of the 2021 annual general shareholders meeting and relevant operating procedures for acceptance of proposals submitted by shareholders who holds over 1% of outstanding shares

3.4.12 Major Issues of Record or Written Statements Made by Any Director or Supervisor Dissenting to Important Resolutions Passed by the Board of Directors : None

~78~

3.4.13 Resignation or Dismissal of the Company’s Key Individuals, Including the Chairman, CEO, and Heads of Accounting, Finance, Internal Audit and R&D : None

3.5 Information Regarding the Company’s Audit Fee and Independence

3.5.1 Audit Fee

Audit Fee Range Statement

Accounting Firm	Accounting Firm	Name	of CPA	of CPA	Period Covered by CPA’s Audit	Period Covered by CPA’s Audit	Period Covered by CPA’s Audit	Remarks
PricewaterhouseCoopers Taiwan		Yung-Chih Lin	Tzu-Meng Liu		January 1st,2020 ~ December 31st,2020			-
						Units: NT$ thousands
Fee Range		Fee Items		Audit Fee		Non-Audit Fee	Total
1	Under NT$ 2,000,000					V
2	NT$2,000,00(included)~ NT$4,000,000
3	NT$4,000,000(included)~ NT$6,000,000			V			V
4	NT$6,000,00(included)~ NT$8,000,000
5	NT$8,000,000(included)~ NT$10,000,000
6	Over NT$100,000,000

3.5.2The amount of non-auditing relevant fees charged by the appointed independent auditors and the related parties reaches one fourth of the Company's annual auditing expenses, the audit and non-audit fee and services contents should be disclosed:

Units: NT$ thousands

Accounting Firm	Name of CPA	Audit Fee	Non-audit Fee	Non-audit Fee	Non-audit Fee			Period Covered by CPA’s Audit	Remarks
			System of Design	Company Registration	Human Resource	Others	Subtotal
Pricewaterhouse Coopers, Taiwan	Yung-Chih Lin	4,650	-	-	-	880	880	January 1st,2020~ December 31st,2020	Mostly tax consultancy fee
	Tzu-Meng Liu

• 3.5.3 If there is any change in the appointed in dependent auditors and the Company's annual auditing expenses decreased simultaneously, information regarding the amount, percentage and reasons for the decrease in auditing expenses shall be disclosed : Not Applicable. The Company didn’t change the appointed independent auditors.

• 3.5.4 Auditing expenses decreased by 10% in comparison to the previous year, information regarding the amount, percentage and reason for the decrease in auditing expenses shall be disclosed : Not Applicable.

3.6 Replacement of CPA ： Not Applicable.

• 3.7 If the Company's Chairman, President, or managers responsible for financial and accounting affairs have held any position in the accounting firm or its affiliates during the past year, all relevant information should be disclosed : None.

~79~

3.8 Net Change in shareholdings and in shares pledged by directors, management, and shareholders holding more than a 10% share in the Company.

3.8.1 Changes in Shareholding of Directors, Managers and Major Shareholders

Title	Name	2020	2020	As of Apr 30,2021	As of Apr 30,2021
		Holding Increase (Decrease)	Pledged Holding Increase (Decrease)	Holding Increase (Decrease)	Pledged Holding Increase (Decrease)
		Net increase (decrease) in shares held	Net increase (decrease) in shares held	Net increase (decrease) in shares held	Net increase (decrease) in shares held
Director (Institutional Shareholder)	Uni-President Enterprises Corp	0	0	0	0
Chairman and General Chief Strategy Officer (representative)	Chih-Hsien Lo	0	0	0	0
Director (representative)	Tsung-Ming Su	0	0	0	0
Director (representative)	Kun-Shun Tsai	0	0	0	0
Director (representative)	Tsung-Pin Wu	0	0	0	0
Director (representative)	Jia Horng Guo	0	0	0	0
Director (representative)	Fu-Jung Lai	0	0	0	0
Big Shareholder	Uni-President Enterprises Corp	0	0	0	0
Director (Institutional Shareholder)	National Development Fund, Executive Yuan	0	0	0	0
Director (representative)	Ming-Chuan Hsieh	0	0	0	0
Director (representative)	Ya-Po Yang	0	0	0	0
Big Shareholder	National Development Fund, Executive Yuan	0	0	0	0
Director (Institutional Shareholder)	Tainan Spinning Co., Ltd.	0	0	0	0
Director (representative)	Po-Ming Hou	0	0	0	0
Director (Institutional Shareholder)	Kao Chyuan Investment Co., Ltd.	0	0	0	0
Director (representative)	Shiow-Ling Kao	0	0	0	0
Director (Institutional Shareholder)	President International Development Corp.	0	0	0	(11,000,000)
Director (representative)	Chiou-Ru Shih	0	0	0	0
Director (Institutional Shareholder)	Taiwan Sugar Corporation	0	0	0	0
Director (representative)	Kuo-Hsi Wang	0	0	0	0

~80~

Title	Name	2020	2020	As of Apr 30,2021	As of Apr 30,2021
		Holding Increase (Decrease)	Pledged Holding Increase (Decrease)	Holding Increase (Decrease)	Pledged Holding Increase (Decrease)
		Net increase (decrease) in shares held	Net increase (decrease) in shares held	Net increase (decrease) in shares held	Net increase (decrease) in shares held
Independent Director	Wei-Te Ho	0	0	0	0
Independent Director	Wen-Chang Chang	0	0	0	0
Independent Director	Li-Tzong Chen	0	0	0	0
President & CEO	Tsung-Ming Su	0	0	0	0
Vice President	Ching-Wen Lin	0	0	0	0
Vice President	Li-An Lu	0	0	0	0
Vice President	Li-Chiao Chang	0	0	0	0
Vice President	Katy Cheng	0	0	0	0
Vice President	Ling-Hsiao Lien (Note1)	0	0	0	0
Director	CC Lin	0	0	0	0
Director	Yu-Fen Hung	(5,000)	0	0	0
Director & Accounting Officer	Chih-Hui Lin	0	0	0	0
Director & Finance Officer	Chin-Ching Hsu	0	0	0	0
Director	Luh-Chian Chang (Note2)	0	0	0	0
Director	Szu-Ching Wang	0	0	0	0
Director	Nan-Sheng Chan (Note 3)	0	0	0	0
Director	Shun Yang Lin	0	0	0	0
Director	Albert Song (Note4)	0	0	0	0
Director	Yu-Wei Shen	0	0	0	0
Director	Rachel Wang (Note 5)	0	0	0	0
Director	Shih-Hao Yang	0	0	0	0
Director	Cymthia Hung (Note 6)	0	0	0	0
Director	Bin Liu (Note 7)	0	0	0	0
Director	Chia-Chen Chen (Note 8)	0	0	0	0

Note 1: The Vice President was promoted on 2020.08.11 Note 2: The Director was discharged on 2020.06.01

Note 3: The Director was discharged on 2021.03.11

Note 4: The Director was discharged on 2020.06.01

Note 5: The Director was discharged on 2021.02.01

Note 6: The Director was newly appointed on 2020.05.18

Note 7: The Director was newly appointed on 2021.04.01 Note 8: The Director was newly appointed on 2021.04.01

3.8.2 Shares Trading with Related Parties : None

3.8.3 Shares Pledge with Related Parties : None

~81~

3.9 Relationship among the Top Ten Shareholders

3.9.1. Information Disclosing the Relationship between any of the Company's Top Ten Shareholders

							As of 2020.12.31；Unit：Share；%	As of 2020.12.31；Unit：Share；%	As of 2020.12.31；Unit：Share；%
Name (Note 1)	Current Shareholding (Note 4)		Spouse & Minor		Shareholding by Nominee Arrangement		Name and Relationship Between the Company’s Top Ten Shareholders, or Spouses or Relatives Within Two Degrees Note 3)		Remar k
	Shares	%	Shares	%	Shares	%	Name	Relationship
Uni-President Enterprises Corp.	299,968,639	37.94%	－	－	－	－	President International Development Corp.	1.Referring to the parent company of President International Development Corp.(PIDC) 2. Company’s Chairman is also Chairman of PIDC 3. Director also referring to as Director of PIDC 4. Vice President also referring to as President of PIDC 5. Vice President also referring to as Director of PIDC 6. Assistant Vice President also referring to as Director of PIDC 7. Assistant Vice President also referring to as Supervisor of PIDC 8. Chairman is the spouse of Director of PIDC	－
							Tainan Spinning Co., Ltd.	1. Company’s director is also Chairman of Tainan Spinning Co., Ltd. 2. Company’s director is also Director of Tainan Spinning Co., Ltd. 3. Company’s Director is also brother of Director of Tainan SpinningCo.,Ltd.	－
							Prince Housing & Development Corp.	1. Company’s chairman is also Chairman of Prince Housing & Development 2. Company’s director is also Director of Prince Housing & Development 3. Company’s Assistant Vice President is also Director of Prince Housing & Development 4. Chairman is the spouse of Director of Prince Housing & Development	－
							Kao Chyuan Investment Co., Ltd.	1. Company’s Chairman and part of Directors are also the representatives of Kao Chyuan Investment Co., Ltd. 2. Company’s Chairman is the spouse of Chairman of Kao Chyuan Investment Co., Ltd. 3. Company’s Chairman is also Director of Kao Chyuan Investment Co.,Ltd.	－

~82~

Name (Note 1)	Current Shareholding (Note 4)	Current Shareholding (Note 4)	Spouse & Minor	Spouse & Minor	Shareholding by Nominee Arrangement	Shareholding by Nominee Arrangement	Name and Relationship Between the Company’s Top Ten Shareholders, or Spouses or Relatives Within Two Degrees Note 3)	Name and Relationship Between the Company’s Top Ten Shareholders, or Spouses or Relatives Within Two Degrees Note 3)	Remar k
	Shares	%	Shares	%	Shares	%	Name	Relationship
							Tong Yu Investment Corp.	1. Referring to the final parent company of Tong Yu Investment Corp 2. Vice President also referring to as Chairman of Tong Yu Investment Corp	－
							Kai Yu Investment Co.	1. Referring to the parent company of Kai Yu Investment Co. 2. Assistant Vice President also referring to as Chairman of Kai Yu Investment Co.	－
							Kai Nan Investment Co.	1. Referring to the parent company of Kai Nan Investment Co. 2. Assistant Vice President also referring to as Chairman of Kai Nan Investment Co.	－
Uni-President Enterprises Corp Representative： Chih-Hsien Lo	-	-	-	-	-	-	1. President International Development Corp. 2. Prince Housing & Development Corp. 3.Kao Chyuan Investment Co., Ltd	1. Chairman of President International Development Corp. 2. Chairman of Prince Housing & Development 3. Director of and spouse of chairman of Kao Chyuan Investment Co., Ltd.	－
Uni-President Enterprises Corp Representative： Tsung-Ming Su	－	－	－	－	－	－	1. President International Development Corp. 2. Tong Yu Investment Corp	1. President and Director of President International Development Corp 2. Chairman of Tong Yu Investment Corp	－
Uni-President Enterprises Corp Representative： Kun-Shun Tsai	4,678	0.001%	－	－	－	－	－	－	－

~83~

Name (Note 1)	Current Shareholding (Note 4)	Current Shareholding (Note 4)	Spouse & Minor	Spouse & Minor	Shareholding by Nominee Arrangement	Shareholding by Nominee Arrangement	Name and Relationship Between the Company’s Top Ten Shareholders, or Spouses or Relatives Within Two Degrees Note 3)	Name and Relationship Between the Company’s Top Ten Shareholders, or Spouses or Relatives Within Two Degrees Note 3)	Remar k
	Shares	%	Shares	%	Shares	%	Name	Relationship
Uni-President Enterprises Corp Representative： Tsung-Pin Wu	－	－	－	－	－	－	1. President International Development Corp. 2. Prince Housing & Development 3. Kai Nan Investment Co.	1. Supervisor of President International Development Corp. 2. Director of Prince Housing & Development 3. Chairman of Kai Nan Investment Co.	－
Uni-President Enterprises Corp Representative： Jia Horng Guo	－	－	－	－	－	－	－	－	－
Uni-President Enterprises Corp Representative： Fu-Jung Lai	－	－	－	－	－	－	－	－	－
National Development Fund, Executive Yuan Institutional Shareholder	109,539,014	13.85%	－	－	－	－	－	－	－
National Development Fund, Executive Yuan Institutional Shareholder Representative： Ming-Chuan Hsieh	－	－	－	－	－	－	－	－	－
National Development Fund, Executive Yuan Institutional Shareholder Representative： Ya-Po Yang	－	－	－	－	－	－	－	－	－

~84~

Name (Note 1)	Current Shareholding (Note 4)	Current Shareholding (Note 4)	Spouse & Minor	Spouse & Minor	Shareholding by Nominee Arrangement	Shareholding by Nominee Arrangement	Name and Relationship Between the Company’s Top Ten Shareholders, or Spouses or Relatives Within Two Degrees Note 3)	Name and Relationship Between the Company’s Top Ten Shareholders, or Spouses or Relatives Within Two Degrees Note 3)	Remar k
	Shares	%	Shares	%	Shares	%	Name	Relationship
Taiwan Sugar Corporation	32,581,963	4.12%	－	－	－	－	－	－	－
Taiwan Sugar Corporation Shareholder Representative： Kuo-Hsi Wang	－	－	－	－	－	－	－	－	－
President International Development Corp.	28,673,421	3.63%	－	－	－	－	Uni-President Enterprises Corp.	1. An enterprise invested by Uni-President Enterprises on the basis of equity-method evaluation 2. Chairman is the Chairman and General Chief Strategy Officer of Uni-President Enterprises Corp. 3. President and Director is the Vice President of Uni- President Enterprises Corp. 4. Company Director is Director of Uni-President Enterprises Corp. 5. Company Director is Assistant Director of Uni-President Enterprises Corp. 6. Company Supervisor is Assistant Director of Uni- President Enterprises Corp. 7. Company’s Chairman、Director	－
							Tainan Spinning Co., Ltd.	1. Director is also referring to as Chairman of Tainan Spinning Co., Ltd. 2. Director is also referring to as President of Tainan Spinning Co., Ltd. 3. Company’s Director	－
							Kao Chyuan Inv. Co., Ltd.	1. Chairman is the spouse of Chairman of Kao Chyuan Inv. Co., Ltd. 2. Director also referring to as Chairman of Kao Chyuan Inv. Co., Ltd. 3 Company’s Director	－

~85~

Name (Note 1)	Current Shareholding (Note 4)	Current Shareholding (Note 4)	Spouse & Minor	Spouse & Minor	Shareholding by Nominee Arrangement	Shareholding by Nominee Arrangement	Name and Relationship Between the Company’s Top Ten Shareholders, or Spouses or Relatives Within Two Degrees Note 3)	Name and Relationship Between the Company’s Top Ten Shareholders, or Spouses or Relatives Within Two Degrees Note 3)	Remar k
	Shares	%	Shares	%	Shares	%	Name	Relationship
President International Development Corp.	28,673,421	3.63%	－	－	－	－	Prince Housing &Development Corp.	1. Company’s Chairman is also chairman of Prince Housing &Development Corp. 2. Director is also Director of Prince Housing & Development Corp. 3. Supervisor is also Director of Prince Housing & Development Corp 4. Director is also President of Prince Housing & Development Corp. 5. Company’s Director	－
							Tong Yu Investment Corp.	1. An enterprise invested by Tong Yu Investment Corp. on the basis of equity-method evaluation 2. President is also Chairman of Tong Yu Investment Corp. 3. Company is Chairman and Director of Tong Yu Investment Corp.	－
							Kai Yu Investment Co.	1. Director is Chairman of Kai Yu Investment Co.	－
							Kai Nan Investment Co.	1. Supervisor is also referring to as Chairman of Kai Nan Investment Co.	－
President International Development Corp. Representative： Chiou-Ru Shih	－	－	－	－	－	－	－	－	－
Tainan Spinning Co., Ltd.	23,605,921	2.99%	－	－	－	－	Uni-President Enterprises Corp..	1. Chairman is also referring to as Director of Uni-President Enterprises Corp. 2. Chairman is a brother of Director of Uni-President Enterprises Corp.	－
							President International Development Corp.	1. Company’s Director	－
							Prince Housing &Development Corp.	1. Chairman is also referring to as Director of Prince Housing &Development Corp. 2. Chairman is a brother of Director of Prince Housing &Development Corp.	－

~86~

Name (Note 1)	Current Shareholding (Note 4)	Current Shareholding (Note 4)	Spouse & Minor	Spouse & Minor	Shareholding by Nominee Arrangement	Shareholding by Nominee Arrangement	Name and Relationship Between the Company’s Top Ten Shareholders, or Spouses or Relatives Within Two Degrees Note 3)	Name and Relationship Between the Company’s Top Ten Shareholders, or Spouses or Relatives Within Two Degrees Note 3)	Remar k
	Shares	%	Shares	%	Shares	%	Name	Relationship
Tainan Spinning Co., Ltd. Representative： Po-Ming Ho	－	－	－	－	－	－	1. ni-President Enterprises Corp. 2. President International Development Corp. 3. Prince Housing & Development Corp.	1. As Representative of institutional Director of Uni- President Enterprises Corp. 2. As Representative of institutional Director of President International Development Corp. 3. As Representative of institutional Director of Prince Housing & Development Corp.	－
Prince Housing & Development Corp	23,605,921	2.99%	－	－	－	－	Uni-President Enterprises Corp.	1. Uni-President Enterprises Corp. is Company’s Chairman and biggest Shareholder. 2. Chairman is also referring to as Chairman of Uni- President Enterprises Corp. 3. Partial Directors are also Directors of Uni-President Enterprises Corp.	－
							Kao Chyuan Inv. Co., Ltd.	1. Kao Chyuan Inv. Co., Ltd. is Company’s Director 2. Chairman is the spouse of Chairman of Kao Chyuan Inv. Co., Ltd. 3. Director is Director of Kao Chyuan Inv. Co.,Ltd.	－
Tong Yu Investment Corp.	15,067,166	1.91%	－	－	－	－	President International Development Corp.	1. An enterprise invested by President International Development Corp. on the basis of equity-method evaluation 2. Chairman is also referring to as the Director and President of President International Development Corp. 3. Company’s Chairman and Director	－
							Uni-President Enterprises Corp.	Chairman is also referring to as the Vice President of Uni- President Enterprises Corp.	－
Kao Chyuan Investment Co., Ltd.	14,832,733	1.88%	－	－	－	－	Uni-President Enterprises Corp.	1. Chairman is also referring to as the Director of Uni- President Enterprises Corp. 2. Director is Chairman of Uni-President Enterprises Corp. 3. Chairman is the spouse of Chairman of Uni-President Enterprises Corp. 4. Uni-President Enterprises Corp.’s Chairman and Director.	－

~87~

Name (Note 1)	Current Shareholding (Note 4)	Current Shareholding (Note 4)	Spouse & Minor	Spouse & Minor	Shareholding by Nominee Arrangement	Shareholding by Nominee Arrangement	Name and Relationship Between the Company’s Top Ten Shareholders, or Spouses or Relatives Within Two Degrees Note 3)	Name and Relationship Between the Company’s Top Ten Shareholders, or Spouses or Relatives Within Two Degrees Note 3)	Remar k
	Shares	%	Shares	%	Shares	%	Name	Relationship
							President International Development Corp.	1. Chairman is also referring to as the Director of President International Development Corp. 2. Director is also referring to as the Chairman of President International Development Corp. 3. Chairman is the spouse of Chairman of President International Development Corp. 4. Referring to President International Development Corp.’s Director	－
							Prince Housing &Development Corp.	1. Chairman is also referring to as the Director of Prince Housing &Development Corp. 2. Director is the Chairman of Prince Housing &Development Corp. 3. Chairman is the spouse of Chairman of Prince Housing &Development Corp. 4. Referring to Prince Housing &Development Corp.’s Director	－
Kao Chyuan Inv. Co., Ltd. Representative： Shiow-Ling Kao	－	－	－	－	－	－	1. Uni-President Enterprises Corp. 2. President International Development Corp 3. Prince Housing & Development Corp.	1. Director of and spouse of Chairman of Uni-President Enterprises Corp. 2. Director of and spouse of Chairman of President International Development Corp. 3. Director of and spouse of Chairman of Prince Housing &Development Corp.	－
Kai Yu Investment Co.	14,763,165	1.87%	－	－	－	－	Uni-President Enterprises Corp.	1. Referring to the Subsidiary of Uni-President Enterprises Corp. 2. Uni-President Enterprises Corp.’s representative is Chairman 3. Chairman is also referring to as the Assistant Vice President of Uni-President Enterprises Corp.	－
							President International Development Corp.	1. Same Parent Company with President International Development Corp. 2. Chairman is also referring to as the Director of President International Development Corp.	－

~88~

Name (Note 1)	Current Shareholding (Note 4)	Current Shareholding (Note 4)	Spouse & Minor	Spouse & Minor	Shareholding by Nominee Arrangement	Shareholding by Nominee Arrangement	Name and Relationship Between the Company’s Top Ten Shareholders, or Spouses or Relatives Within Two Degrees Note 3)	Name and Relationship Between the Company’s Top Ten Shareholders, or Spouses or Relatives Within Two Degrees Note 3)	Remar k
	Shares	%	Shares	%	Shares	%	Name	Relationship
							Tong Yu Investment Corp.	Same Parent Company with Tong Yu Investment Corp.	－
							Kai Nan Investment Co.	Same Parent Company with Kai Nan Investment Co.	－
Kai Nan Investment Co.	13,950,061	1.76%	－	－	－	－	Uni-President Enterprises Corp.	1. Referring to the Subsidiary of Uni-President Enterprises Corp. 2. Uni-President Enterprises Corp.’s representative is the Chairman 3. Chairman is also referring to as the Assistant Vice President of Uni-President Enterprises Corp.	－
							President International Development Corp.	1. Same Parent Company with President International Development Corp. 2. Chairman is also referring to as the Supervisor of President International Development Corp.	－
							Prince Housing & Development Corp.	Chairman is also referring to as the Director of Prince Housing &Development Corp.	－
							Tong Yu Investment Corp.	Same final Parent Company with Tong Yu Investment Corp.	－
							Kai Yu Investment Co.	Same Parent Company with Kai Yu Investment Co	－

Note 1: All top ten Shareholders’ information should be disclosed, the institutional shareholders should be expressed separately by name of Institutional shareholders and their representative.

、 Note 2 Shareholding percentage is calculated by totaling the holding percentage of shareholder him/herself Spouse & Minor and Shareholding by Nominee Arrangement.

Note 3 Name and Relationship between the Company’s Top Ten Shareholders (including institutional and natural person shareholders) Note 4: Holding Shares and Holding Percentage as of 2021.04.30.

3.10 Ownership of Shares in Affiliated Enterprises

	2020.12.31；Unit: shares: %	2020.12.31；Unit: shares: %	2020.12.31；Unit: shares: %	2020.12.31；Unit: shares: %	2020.12.31；Unit: shares: %	2020.12.31；Unit: shares: %
Affiliated Enterprises(Note)	Ownership by the Company		Direct or Indirect Ownership by Directors, Supervisors, Managers		Total Ownership
	Shares	%	Shares	%	Shares	%
SPT International, Ltd.	118,524,644	100%	-	-	118,524,644	100%
ScinoPharm Singapore Pte Ltd.	2	100%	-	-	2	100%

Note: Company’s Long Term Investment on the basis of equity-method evaluation

~89~

IV. Capital Overview

4.1 Capital and Shares

4.1.1 Source of Capital

4.1.1.1 Issued Shares 2021.04.30

4.1	.1.1 Is	sued Shares	sued Shares			2021.04.30	2021.04.30	2021.04.30
Month/ Year	Par Value (NT$)	Authorized Capital		Paid-in Capital		Remark
		Shares	Amount (NT$ thousands)	Shares	Amount (NT$ thousands	Sources of Capital (NT$ thousands)	Capital Increased by Assets Other than Cash	Other
11/1997	10	270,000,000	2,700,000	67,500,000	675,000	Registered capital	Technical shares account for 15% of total capital 101,250	Note1
12/1998	10	270,000,000	2,700,000	189,000,000	1,890,000	Cash Capital Increase 1,032,750	Technical shares account for 15% of total capital 182,250	Note 2
10/1999	10	270,000,000	2,700,000	270,000,000	2,700,000	Cash Capital Increase 688,500	Technical shares account for 15% of totalcapital 121,500	Note 3
02/2002	10	370,000,000	3,700,000	370,000,000	3,700,000	Cash Capital Increase 1,000,000	-	Note 4
07/2003	10	530,000,000	5,300,000	420,000,000	4,200,000	Cash Capital Increase 500,000	-	Note 5
04/2004	10	530,000,000	5,300,000	470,000,000	4,700,000	Cash Capital Increase 500,000	-	Note 6
10/2004	10	530,000,000	5,300,000	486,000,000	4,860,000	Cash Capital Increase 160,000	-	Note 7
12/2005	10	610,000,000	6,100,000	551,000,000	5,510,000	Cash Capital Increase 650,000	-	Note 8
06/2008	10	610,000,000	6,100,000	551,373,392	5,513,734	Merge Capital Increase 3,734	New shares were issued to merge with subsidiary ScinoPharm Biotech Ltd.	Note 9
08/2010	20	610,000,000	6,100,000	610,000,000	6,100,000	Cash Capital Increase 586,266	-	Note 10
12/2010	10	1,000,000,000	10,000,000	610,000,000	6,100,000	To increase authorized capital	-	Note 11
10/2011	46	1,000,000,000	10,000,000	631,000,000	6,310,000	Cash Capital Increase 210,000	-	Note 12
08/2012	10	1,000,000,000	10,000,000	649,930,000	6,499,300	capital increase on retained earnings 189,300	-	Note 13
08/2013	10	1,000,000,000	10,000,000	675,927,200	6,759,272	capital increase on retained earnings 259,972	-	Note 14
08/2014	10	1,000,000,000	10,000,000	702,964,288	7,029,643	capital increase on retained earnings 270,371	-	Note 15
08/2015	10	1,000,000,000	10,000,000	731,082,860	7,310,829	capital increase on retained earnings 281,186	-	Note 16
08/2016	10	1,000,000,000	10,000,000	760,326,175	7,603,262	capital increase on retained earnings 292,433	-	Note 17
08/2017	10	1,000,000,000	10,000,000	790,739,222	7,907,392	capital increase on retained earnings 304,130		Note 18

Note 1: Approved No.: (86) Yuan Shang No. 23483

Note 2: Approved No.: (88) Yuan Shang No. 003454

Note 3: Approved No.: (88) Yuan Shang No. 027020 Note 4: Approved No.: Nan Erh No. 0910005896 Note 5: Approved No.: Nan Shang No.0920014152 Note 6: Approved No.: Nan Shang No.0930009753 Note 7: Approved No.: Nan Shang No.0930031092

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Note 8: Approved No.: Nan Shang No.0950001220 Note 9: Approved No.: Nan Shang No.0970014601 Note 10: Approved No.: Nan Shang No.0990018156 Note 11: Approved No.: Nan Shang No.09900129213 Note 12: Approved No.: Nan Shang No.1000025207 Note 13: Approved No.: Nan Shang No.1010021098 Note 14: Approved No.: Nan Shang No.1020021135 Note 15: Approved No.: Nan Shang No.1030021574 Note 16: Approved No.: Nan Shang No.1040021085 Note 17: Approved No.: Nan Shang No.1050021651 Note 18: Approved No.: Nan Shang No.1060021942

4.1.1.2 Type of Stock

Stock	Stock	Stock
Authorized Capital			Remarks
Issued Shares (Note)	Un-issued Shares (Share)	Total Shares
790,739,222	209,260,778	1,000,000,000	Listed Company Stock

4.1.1.3 Information for Shelf Registration: None

4.1.2 Status of Shareholders

As of .2021.04.30

Item	Government Agencies	Financial Institutions	Other Juridical Persons	Domestic Natural Persons	Foreign Institutions & Natural Persons	Total
Number of Shareholders	1	0	93	33,281	122	33,497
Shareholding (shares)	109,539,014	0	474,288,273	177,622,638	29,289,297	790,739,222
Percentage	13.85%	0%	59.98%	22.46%	3.71%	100%

4.1.3 Shareholding Distribution Status

4.1.3.1 Common Shares (The Par Value for each share is $10 NTD)

As of 2021.04.30

			As of 2021.04.30
Class of Shareholding (Unit: Share)	Number of Shareholders	Shareholding (Shares)	Percentage
1～999	7,826	1,384,051	0.175%
1,000～5,000	18,818	39,235,065	4.962%
5,001～10,000	3,399	25,545,243	3.231%
10,001～15,000	1,161	14,299,198	1.808%
15,001～20,000	684	12,466,027	1.577%
20,001～30,000	624	15,488,553	1.959%
30,001～50,000	459	17,977,673	2.273%
50,001～100,000	301	20,992,158	2.655%
100,001～200,000	133	18,267,921	2.310%
200,001～400,000	50	13,388,728	1.693%
400,001～600,000	14	6,723,640	0.850%
600,001～800,000	7	4,888,725	0.618%
800,001～1,000,000	2	1,856,797	0.235%
1,000,001 ~	19	598,225,443	75.654%
Total	33,497	790,739,222	100.000%

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4.1.3.2 Preferred Shares: None.

4.1.4 List of Major Shareholders

As of 04/30/ 2021

4.1.4 List of Major Shareholders		As of 04/30/ 2021
Shares Shareholder's Name	Shares	Percentage
Uni-President Enterprises Corp	299,968,639	37.94%
National Development Fund, Executive Yuan	109,539,014	13.85%
Taiwan Sugar Corporation	32,581,963	4.12%
President International Development Corp.	28,673,421	3.63%
Tainan Spinning Co., Ltd.	23,605,921	2.99%
Prince Housing & Development Corp.	23,605,921	2.99%
Kao Chyuan Inv. Co., Ltd.	14,832,733	1.88%
Kai Yu Investment Co.	14,763,165	1.87%
Tong Yu Investment Corp.	14,299,166	1.81%
Kai Nan Investment Co.	13,950,061	1.76%

Note: The Name 、 Holding Shares and Holding Percentage of the Top Ten Shareholders.

4.1.5 Market Price, Net Worth, Earnings, and Dividends per Share

Item	Year	Year	2019	2020	As of 2021.03.31
Market Price per Share	Highest		29.80	40.50	28.95
	Lowest		22.75	22.50	24.10
	Average		26.86	32.72	25.92
Net Worth per Share	Before Distribution		12.98	13.32	13.67
	After Distribution		12.71	(Note 4)	-
Earnings per Share	Weighted Average Shares (thousand shares)		790,739	790,739	790,739
	Earnings per Share (Undiluted)		0.27	0.36	0.11
	Earnings per Share (Diluted)		0.27	(Note 4)	-
Dividends per Share	Cash Dividends		0.27	(Note 4)	-
	Stock Dividends	(Note 4)	-	(Note 4)	-
		(Note 4)	-	(Note 4)	-
	Accumulated Undistributed Dividends		-	-	-
Return on Investment	Price / Earnings Ratio (Note1)		99.48	90.89	-
	Price / Dividend Ratio (Note2)		99.48	(Note 4)	-
	Cash Dividend Yield Rate (Note 3)		1.01%	(Note 4)	-

Note 1: Price / Earnings Ratio = Average Market Price / Earnings per Share

Note 2: Price / Dividend Ratio = Average Market Price / Cash Dividends per Share

Note 3: Cash Dividend Yield Rate = Cash Dividends per Share / Average Market Price

Note 4: The income distribution plan for fiscal 2020 has not yet approved by the general shareholders meeting.

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4.1.6 Dividend Policy and Implementation Status

• 4.1.6.1 Dividend Policy:

Since the business environment has been changing enormously, and ScinoPharm is experiencing the steadily growth, the annual earnings distribution should be considered in terms of future capital budget, long-term investment, and business funding needs, etc. in order to determine the amount to be retained of distributed as stock dividend or cash dividend.

If there are earnings for distribution at the end of each fiscal year, after offsetting any loss of prior year(s) and paying all taxes and dues, 10% of the remaining net earnings shall be set aside as legal reserve, but not limited if the legal reserve reach the company’s actual capital received. And then would be appropriated as special reserve in accordance with Securities Exchange Law. The remaining net earnings can be distributed together with prion accumulated unappropriated retained earnings. The Board of Directors will consider the factors that were mentioned above to make the dividend distribution proposal. The dividend should be set in the range from 50% to 100% of the accumulated unappropriated retained earnings and the amount of cash dividend shall exceed 30% of the total amount of dividends distribution. The dividends could be distributed in accordance with the resolution that is approved by the Board of Directors and the Annual Shareholders’ Meeting.

• 4.1.6.2. Proposed Distribution of Dividend

The proposal for distribution of 2020 profits was passed at the Meeting of the Board of the Board of Directors (March 18[th] 2021). This proposal, a cash dividend of NTD 0.5 per share, will be discussed at annual shareholders’ meeting.

4.1.7 Influence of proposal of stock grant in shareholders' meeting on the company's business performance and earnings per share:

There is no need to make the disclosure, as the company doesn't compile 2021 financial forecast.

4.1.8 Employee Bonus and Directors' Remuneration

• 4.1.8.1. The limit or percentage of Director’s Remuneration and Employee Bonus are regulated by Articles of Incorporation:

• A ratio of profit of the current year distributable, after covering accumulated losses, shall be distributed as employees’ compensation and directors’ remuneration. The ratio shall not be lower than 2% for employees’ compensation and shall not be higher than 2% for directors’ remuneration.

• 4.1.8.2. Estimate Foundation of Employee Bonus and Directors' Remuneration:

• The basis of estimates is based on a certain percentage of 2019 net income after taking into account the legal reserve and other factors, as prescribed under the Company’s Articles of Incorporation.

• 4.1.8.3. Profit Distribution of Year 2020 Approved by Board of Directors Meeting for Employee Bonus and Directors’ Remuneration

• (1) the employees’ compensation for 2020 was NT$35,288,214; directors’ compensation was NT$7,921,843, all compensation was distributed in cash form.

• (2) The aforementioned amounts differed from budgeted amounts by 0 for both employee compensation and directors’ compensation.

• 4.1.8.4. The Actual Distributable compensation for employees and directors for previous year (including distributable shares, distributable amount and share price):

• The Actual Distributable compensation for employees and directors on 2019 is as following:

• (1)The Distributable compensation for employees and directors on 2019 is calculated according to Article 40 of the Articles of Incorporation: “Should the Company earn surpluses within the current term, at least two percent of surpluses should be set aside for employee compensation, and no more than two percent of surpluses should be set aside for director.

• (2) According to the Articles of Incorporation, the employee compensation for 2019 was NTD 24,651,373, director compensation was NTD2,942,121, all compensation was distributed in cash form. The aforementioned amounts differed from budgeted amounts by 0 for employee and -899,916 for director compensation. The difference was caused by the changes in accounting estimates and was listed as profit or loss in year 2020.

4.1.9 Buyback of Treasury Stock: None

4.2 Bonds: None

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4.3 Status of Corporate Bonds, Preferred Stock, GDR, Employee Stock Option Plan, Employee Restricted Stock Plans, Mergers, Acquisitions, and Spin-Offs

1. Issuance of special shares: nil

2. Issuance of global depository receipts: nil

3. Issuance of stock-option warrants for employees: for details, refer to the following table and supplementary table in the next page

4. issuance of restricted stock awards: nil

5. Issuance of new shares for acquisition and merger or acquisition of shares of other companies: nil

4.3.3.1The amount of employee stock options outstanding should be disclosed till the print of the annual report with its impact on shareholders’ equity.

Issuance of Employee Stock Options

			As of 2021.04.30	As of 2021.04.30
Type of Stock Option	First issuance of Employee Stock Options on 2013	First issuance of Employee Stock Options on 2015	First issuance of Employee Stock Options on 2016	First issuance of Employee Stock Options on 2017
Approval date	2013.10.24	2015.10.13	2016.10.12	2017.10.12
Issue date	2013.12.03	2015.11.06	2016.10.14	Issuance canceled (Note 3)
Units issued	1,000,000Units	1,500,000 Units	1,500,000 Units	N/A
Shares of stock options to be issued as a percentage of outstanding shares	0.12646%	0.18970%	0.18970%	N/A
Duration	10years	10years	10years	N/A
Conversion measures	issue new shares	issue new shares	issue new shares	N/A
Conditional conversion periods and percentages	The ratios of stock options which could be exercised will reach 50%, 75% and 100%, respectively, after two, three and four years of issuance.	The ratios of stock options which could be exercised will reach 50%, 75% and 100%, respectively, after two, three and four years of issuance.	The ratios of stock options which could be exercised will reach 50%, 75% and 100%, respectively, after two, three and four years of issuance.	N/A
Converted shares	0share	0share	0share	N/A
Exercised amount	0	0	0	N/A
Number of shares yet to be converted	408,000shares	709,000shares	859,000shares	N/A
Adjusted exercise price for those who have yet to exercise their rights	NT$74.50/share	NT$37.20/share	NT$37.70/share	N/A
Unexercised shares as a percentage of total issued shares	0.05160%	0.0896%	0.10863%	N/A
Impact on possible dilution of shareholdings	The stock options being issued can be exercised in three portions after two years, and the impact on shareholders’ equity can be diluted gradually.	The stock options being issued can be exercised in three portions after two years, and the impact on shareholders’ equity can be diluted gradually.	The stock options being issued can be exercised in three portions after8two years, and the impact on shareholders’ equity can be diluted gradually.	N/A

Note 1: Each unit of stock options is entitled to buy one common share. Note 2: As calculated based on a total of 790,739,222 shares outstanding currently.

Note 3: Plan for the first issuance of stock-option warrants for employees, totaling 1,500,000 shares, in 2018 was canceled, a decision publicized on Oct. 1, 2018, due to the consideration of market price.

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4.3.3.2 List of Executives Receiving Employee Stock Options and the Top Ten Employees with Stock Options

2021.04.30 ； Unit ： share/NT$

	Title	Name	No. of Stock Options A	Stock Options as a Percentage of Shares Issued (Note 1)			Exercised				Unexercised
					No. of Shares Converted	Strike Price (NT$	Amount (NT$ thousands)	Converted Shares as a Percentage of Shares Issued ((Note 1))	No. of Shares Converted A1	Strike Price (NT$) B	Amount (NT$ thousands) C=A1*B	Converted Shares as a Percentage of Shares Issued (Note 1)
Executives Officers	Vice President	Chih-Fang Chen (Note 2)	1,120,000	0.14164%	0	－	0	0	1,120,000	74.50 / 37.20 / 37.70	50,439,200	0.14164%
	Vice-President	Ching-Wen Lin
	Vice President	Li-Chiao Chang
	Vice President	Ling-Hsiao Lien (Note 3)
	Senior Director	Yu-Fen Hung
	Senior Director Accounting	Chih-Hui Lin
	Director	Lu-Chian Chang (Note 2)
	Director	Nan-Sheng Chan (Note 2)
	Director	Shun Yang Lin
	Director	Albert Song (Note 2)
	Director	Yu-Wei Shen
	Director	Bin Liu (Note 3)
	Director	Chia-Chen Chen (Note 3)
Employees	Senior Manager	Tsung-Yu Hsiao	478,000	0.06045%	0	－	0	0	478,000	74.50 / 37.20 / 37.70	21,274,400	0.06045%
	Senior Manager	Tsung-Cheng Hu
	Senior Manager	John Tsai
	Senior Manager	Jing Yi Wang
	Senior Manager	Yatin Lee
	Senior Manager	Syray Wen
	Senior Manager	Hui-Chun Chen
	Manager	Hanch Su (Note 2)
	Manager	Zheng-Yi Wang
	Manger	Louis Wang
	Manager	Una Kang
	Manager	Sylvia Chen

Note 1: Calculation on the basis of the company's current share issuance totaling 790,737,222 shares

• Note 2: Chih-Fang Chen, Lu-Chian Chang, Nan-Sheng Chan, Albert Song, Hanch Su retired on 2020.07.18, 2020.06.01, 2021.03.13, 2020.06.01 and 2021.03.01 shareholding by above directors are still included in the calculation

Note 3: Ling-Hsiao Lien, Bin Liu, Chia-Chen Chen are promoted individually on 2020.08.11, 2021.04.01, 2021.04.01 as Vice President and Directors.

4.4 Financing Plans and Implementation

Any incomplete share issuance or private placement or any completed share issuance or private placement over the past three years from which benefits have not yet been reported up to end of previous season before the printed date of the Annual Report: None.

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V. Operational Highlights

5.1 Business Activities

5.1.1 Business Scope

• 5.1.1.1 The business items of the Company are as follows:

• A C802041 Manufacture of pharmaceuticals;

• B C801990 Manufacture of other chemical materials;

• C IG01010 Biotechnological services;

• D F601010 Intellectual property rights related services

• E F401010 International trade.

• Research, development, production, manufacture and distribution of the following products: (1) generic APIs, (2) protein drugs, (3) oligonucleotide, (4) peptide, (5) injection formulation, (6) small-molecule new drugs.

• Consulting, advisory and technical services relating to the above products.

• International trade in connection with the above products.>>

• 5.1.1.2 2020 Revenue distribution

Unit ： thousand NTD ； %

2020 Revenue distribution	Unit：thousand NTD；%	Unit：thousand NTD；%	Unit：thousand NTD；%	Unit：thousand NTD；%
Major Products	Year 2020
	Total Sales		of Total Sales(%)
Manufacturing and sales of API	2,798,310		91%
Injection formulation sales	146,322		5%
Technical Services Income	98,675		3%
Other Income	39,621		1%
Total Sales	3,082,928		100%

5.1.1.3 Categories of services available currently

ScinoPharm Taiwan Ltd. was set up to provide active pharmaceutical ingredient (API) manufacturing services to the global generic drug makers initially. Powered by its maturing analytic capability, organic synthesizing techniques, and its engagement in special synthetic technology for different therapeutic areas, ScinoPharm is currently able to provide small molecular drugs, complex natural molecules and its derivatives, synthesis services for major biochemistry molecules such as peptides and nucleic acids, as well as customized manufacturing process development from process research to commercial production and to subcontract manufacturing. The company has also continued to expand its business lines to include the offerings of injection drugs and related services. The main results are summarized as follows:

• A. In-house developed APIs (active pharmaceutical ingredients) categorized by purpose:

• Cancer-related application APIs totaling thirty-eight items.

• Central nervous system-related application APIs totaling twelve items.

• Cardiovascular-related application APIs totaling six items.

• Infection-related application APIs totaling six items.

• Ophthalmology-related application APIs totaling three items.

• Genitourinary-related application APIs totaling three items.

• Gynecology-related application APIs totaling two items

• Metabolism symptoms related application APIs totaling two items.

• APIs for respiratory system related totaling two items.

• APIs for immune system related totaling one item.

• B. Customized development and subcontract production of APIs:

• Commercialized production of APIs totaling seven items (five of them are new drugs).

• APIs under phase III clinical trials totaling eight items.

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C. Development and manufacturing services for injection drugs:

• While already being a leading provider of oncological APIs to regulated markets worldwide as far as product categories and customer base are concerned, ScinoPharm has been driven by factors including increasing demand from the injectable product manufacturing industry in recent years and market research feedbacks from global clients to implement a downward integration strategy by setting up an injectable product plant at its existing Tainan production base to provide one-stop service from API research to injectable production to clients. The company has completed the development of three injection drugs in dosage form and has also applied for a drug permit license each via a cooperation model. One of the three injectable is dedicated to cancer-related applications and the other is for cardiovascularrelated applications. The company has entered a strategic alliance with international pharmaceutical firm Baxter recently for joint development, manufacturing, and mass production of fosaprepitant dimeglumine, an antiemetic drug in chemotherapy for cancer.

Via a collaborative mode, the former two have hit the U.S. market and are scheduled to extend their reach to emerging markets, including South America, the Middle East, and ASEAN, leading to further expansion of ScinoPharm's sales network. Cooperation with Baxter will be extended to treatment of lung cancer, multiple myeloma, and breast cancer. In addition to active transformation of the company into an all-round pharmaceutical firm, the company will also expand generic-drug ampoule production line, as a source for revenue growth. ScinoPharm can provide customized development and subcontract production for injection drugs once the injectable plant commences its official operations and will also offer injection drugs in dosage form later.

5.1.1.4 Roadmaps for new products:

njection drugs in dosage form later. Roadmaps for new products:
Newproducts on drawingboard	Purpose
SPT1461	Cancer target drugs
SPT1462	Cancer target drugs
SPT1466	Cancer drugs
SPT1468	Cancer target drugs
SPT1469	Cancer drugs

5.1.2 Industry Overview

• 5.1.2.1 Current Situation and Future Development of the Industry

According to the 2020 report of IQVIA, the world's leading medical information provider (formerly Quintiles and IMS Health), global pharmaceutical outlay will expand at an annual clip of 2-5%, topping US$1.1 trillion by 2024. Access of patients worldwide to various kinds of pharmaceuticals, notably those for rare diseases and cancer, will be greatly improved.

Almost every country has been under pressure of medical budgets and spending, and legitimate pricing for pharmaceuticals is in continued discussion and always controversial. So far, international pharmaceutical manufacturers have widely differed in concept and method of how to reach balance among value standard, drug price, sales volume and sustainable marketing.

The US in 1984 enacted Hatch-Waxman Act (informal for Drug Price Competition and Patent Term Restoration Act), driving development of generic drug markets around the world. Many countries, under pressure of medical budgets, have therefore amended regulations concerned and proposed plans to boost marketing and use of generic drugs to decrease medical spending by the public and private sectors, with Japan being a successful case. According to US-based IMS Health, developed countries' total spending on generic drugs took up 28.8% of total drug spending in 2016 and the proportion is forecast to rise to 31% in 2021.

Heating competition for generic drugs has resulted in pharmaceutical manufacturing industry' demand for management of supply chains and quick time-to-market. In order to control production cost and spread risks, procurement of APIs (active pharmaceutical

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ingredients) is on the rise and shift from production of pharmaceuticals in North America and West Europe to outsourced production in East Europe and Asia is increasing. In particular, the API market has been in intense competition, with global market vale estimated to rise to US$213.9 billion in 2021.

Emergence of Chinese and Indian manufacturers in recent years has intensify competition among API (active pharmaceutical ingredients) suppliers, fueling price competition.

• 5.1.2.2 Industrial supply chain of related pharmaceutical products in the up, middle and downstream sectors

==> picture [498 x 169] intentionally omitted <==

----- Start of picture text -----

Initial API Drug Clinics,
production of Production Production Hospitals
raw materials
Chemical process Chemical process Physical production Prescriptions,
(cGMP (cGMP production) Medical treatment
Precision chemicals, production) 、
Injection drugs
Specialty raw materials
Intermediates、 Capsules、
API Tablets、Ointment
----- End of picture text -----

• 5.1.2.3 Global development trend and competition of the industry of active pharmaceutical ingredients.

• A. Outsourcing trend for the production of active pharmaceutical ingredients of new drugs

Demands of preparations companies for active pharmaceutical ingredients can be classified, according to production and supply methods, into own production for own use and outsourcing production. Although majority of major international patented drug companies tend to produce active pharmaceutical ingredients for own use by themselves, for better grip of quality and time, they are intensifying focus on R&D, sales, and market grasp for new drugs, in order to speed up rollout of new drugs, in order to cope with threat of generic drugs and uphold market shares. In view of lesser role of active pharmaceutical ingredients in their profits and in order to massive capital outlays for plant production, growing numbers of major international patented drug companies have outsourced production of active pharmaceutical ingredients. By contrast, majority of smaller patented drug companies have outsourced production of active pharmaceutical ingredients for different stages of new-drug development, including R&D and clinical tests. The outsourcing trend has been intensified by the following objective conditions:

• 1) With timing of marketing of NCEs (new chemical entities) being the primary concern of patented drug companies, outsourcing of production can shorten R&D process and advance materialization of extra revenue and profit.

• 2) Outsourcing production for active pharmaceutical ingredients can reserve limited resources for R&D and production with higher priorities, thereby maximizing profits.

• 3) Joint development of products and division of labor in mass production can lower production cost.

• 4) Outsourcing-production firms can cut cost, via economy of scale and form an industrial chain for higher efficiency, while patented drug companies can maintain flexible operation, in line with market needs.

• B. Trend of the market and competition of active pharmaceutical ingredients of generic drugs

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Since Hatch-Waxman Act cane into effect, the procedures for applying for generic drug licenses and launching such drugs have been much simplified and thus the time taken has been increasingly shortened. Therefore, the quicker the supply of APIs used to produce generic drugs, the more business opportunities the suppliers have.

Meanwhile, as for legal requirement of quality, member countries of ICH have substituted knowledge-based risk-management mode for inspection-based quality-control mode, with the U.S. even replacing past practice of itemized inspection with question-based inspection. Therefore, generic-drug companies must have more precise grip of quality of pharmaceuticals. Accordingly, suppliers of active pharmaceutical ingredients have to make concerted effort with generic-drug firms in upgrading quality-control system, so that quality concern would not cause delay in the obtaining of generic-drug licenses. Quality has become prerequisite for suppliers of active pharmaceutical ingredients in landing orders.

Studies show that in one year after the first generic drug maker launched products, the number of newcomers is almost twice that of original generic drug makers in the initial period. Along with increasing competition is increasing demand for lowering cost, and therefore makers of APIs used to produce generic drugs have to not only supply quality APIs as early as possible but also be competitive in price.

Under pressure of earlier supply of APIs of better quality at lower prices, API makers should be more dedicated to R&D and strive to protect intellectual properties to keep business growth in supply chains of APIs used to generic drugs.

5.1.3 Technology and R&D status

5.1.3.1 Technological level and R&D for the engaged businesses

As for registered inspection files necessary for entering highly regulated markets, such as the U.S. and Europe, the company had registered 63 DMFs (Drug Master Files) with the U.S. FDA as of the end of December 2020 on top of 28 EDMFs (European DMFs) in some 30 European countries, including CEP (COS) for 20 products, applicable in the European Union. Worldwide, the company has made 864 drug registrations and number of its DMFs will increase further yearly, along with increase of the company's product development items and the need of customers in drug marketing.

Given acute competition in the pharmaceutical industry, the company has formulated "Rules Governing Patent-Related Affairs," to facilitate patent application and analysis of patent infringement, via proper evaluation of the company's inventions by the legal affairs unit and patent market features, as well as enhance the quality of patent application, patent specification, and report on patent-infringement analysis, thereby maximizing the company's benefits. To avoid encroachment on competitors' patent from product development to market launch, patent engineers would carry out patent search and analysis periodically following determination of the project" "Measures governing patentrelated affairs" also specific flow for handling cases of patent-infringement analysis, to prevent and slash IP risks. In addition, the accumulated amount of patent applications and approval of patent certificates would be reported to the board of directors every quarter.

As for intellectual properties, except patents no longer being upheld by the company due to irrelevance to the company's long-term development, the company now owns 52 inventions, as well as 254 patents worldwide (as shown in the table below). In addition, there are 19 inventions totally 52 patents are under review. As for technologies needed for mass production of peptide, in addition to the use of solid-phase synthesizing machine, the company has also established technological platform for semi-solid phase synthesis. The company can flexibly embrace either of the two technologies, both fit for cGMP production, according to the features of needed peptide, giving it an extra adaptability and response capability.

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5.1.3.2. R&D Expenses for the latest Two Years as of Annual Report print date

Unit: NT$ thousands

Year	2019	2020	Jan.~April 2021
Combined R&D expense	238,373	245,633	114,308
Combined Net OperatingRevenue	2,892,783	3,082,928	875,200
Combined R&D expense/ Combined Net OperatingRevenue(%)	8.24	7.97	13.06

5.1.3.3.Generic-drug active pharmaceutical ingredients or technologies successfully developed in recent five years.

Year	Products
2016	Brexpiprazole
	Cangrelor
	Olaparib
	Palbociclib
2017	Lifitegrast
	Pimavanserin
	Fosaprepitant Dimeglumine for Injection
	Bortezomib for Injection
2018	Teriparatide
	Sugammadex
	Teriparatide Injection
	Glatiramer Acetate Injection
	Pemetrexed Disodium for Injection
	Fulvestrant Injection
	Gemcitabine Injection
	Docetaxel Injection
	Irinotecan Injection
2019	Elagolix
	Paclitaxel Injection
	Azacitidine for Injection
2020	Liraglutide
	Ivacaftor
	Liraglutide Injection
	Sugammadex Sodium Injection
	Regadenoson Injection

5.1.4 Long-term and Short-term Development

In product marketing, the company targets both near- and long-term markets. Upon its inception, the company focused on solicitation of generic-drug pharmaceutical firms and patented drug firms as customers. Along with enhancement of R&D and production capability, as well as changes in market demand, the company has considerably expanded its customer base. Based on the mutual trust with customers built up over the past years, the company has established a business development division, in charge of joint development of products with customers under a strategic alliance, so as combine the R&D on active pharmaceutical ingredients in the upstream sector and preparations in the downstream sector, creating even greater benefits. Meanwhile, in practice select niche products from the angles of intellectual properties, technologies, and markets, so as to boost the market value of end products. In addition, backed by its existing technological prowess and service quality, the company is capable of providing process R&D and cGMP

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manufacturing service to pharmaceutical firms. It can carry out outsourcing manufacturing for new-drug pharmaceutical companies, functioning as their important partners. To maximize profits for the company, shareholders, and employees, as well as care for both near- and long-term benefits, the company seek, in line with market demands, business development according to the following strategies:

• --Near term:

Cautiously select active pharmaceutical ingredients for development, to meet the needs of generic-drug companies, and clinical-test drugs with potential, from the angle of functional mechanism, to meet the needs of patented-drug pharmaceutical firms for outsourcing manufacturing, so as to augment benefits in the future.

Take advantage of the expanded capacities of Taiwan's Tainan plant and mainland China's Changshu plant to expand business volume and high-quality custom services.

Via strategic alliance, jointly develop, on one hand, drugs with downstream preparations companies, using developed active pharmaceutical ingredients, and new derivatives of developed active pharmaceutical ingredients, from the perspective of preparations companies, so as to pocket maximum benefits.

• --Medium term:

Take advantage of the new injection-drug plant in Taiwan to augment the added value of ScinoPharm's active pharmaceutical ingredients for anti-cancer drugs and satisfy the need of the company's customers for one-stop shopping service.

Utilize production lines in China, ready for operation now, to augment ScinoPharm's capacity in supplying to the needs of the global market, and join hands with strategic partners to accelerate development, in compliance with Chinese laws/regulations, of preparations, so as to tap China's domestic market and expand output value. Join hands with Japanese customers in tapping Japan's generic-drug market and tap other emerging markets via agencies.

• --Long term:

Develop complete R&D and production capability covering both active pharmaceutical ingredients and injection drugs and cooperate with special-drug R&D units in foraying into quasi-new drug market.

Contents and fruits for the utilization of the aforementioned strategies follow:

• (1) Markets of generic drugs and active pharmaceutical ingredients--customer orientation in product selection.

The company cooperates closely with generic-drug customers in pinpointing possible patent deadlines for new drugs, from the perspective of patent litigation, and selecting products with high potential, without the concern of patent infringement. Then, via different strategies and in line with customer needs, provide active pharmaceutical ingredients and related R&D and outsourcing manufacturing service, thereby becoming exclusive suppliers to specific customers for specific products and determining, via discussion with pharmaceutical firms, items for long-term development, in order to establish long-term stable cooperative relationship. Backed by its high expertise and insight for market trend, the company is capable of developing highly active products with high technological threshold, as a result of which some of its active pharmaceutical ingredients boast high shares on the global market.

• (2) Outsourcing manufacturing for patented drug firms—high-specifications standard and quality advantage.

Compared with development active pharmaceutical ingredients of generic drugs, outsourcing manufacturing for new drugs entails lower cost but generates higher profits. Having passed many times inspection by U.S. FDA and regulators of other developed countries, the company has obtained a branded repute for high-specifications manufacturing capability on the global market, ready to undertake outsourcing manufacturing for many patented drug companies.

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Presently, ScinoPharm has formed cooperative relationship with a number of international patented drug companies, providing active pharmaceutical ingredients during the development stage for new drugs. Some of such new drugs have completed clinical tests and been approved by the U.S. FDA and other countries' regulators for marketing.

Active pharmaceutical ingredients for new drugs command higher margin than active pharmaceutical ingredients for generic drugs, although new-drug firms are more demanding in plant specifications and manufacturing process, especially for drugs meant for the U.S. and European markets. ScinoPharm is capable of meeting international standards, in terms of software/hardware, control system, analysis and design capability, technological prowess, production skills, and quality control, acquiring established repute for outsourcing manufacturing service.

• (3) Actively expand capacity--shorten product development cycle and provide one-stop shopping service

ScinoPharm Taiwan began to build two new large-scale production lines in 2012, which already started operation in 2013. The production line of ScinoPharm (Changshu) Pharmaceuticals in China have also been completed and ready for test run in the first quarter of 2016, after passing inspection, with zero flaw, by the U.S. FDA in the fourth quarter of 2015. These production lines have strong edge in the development and manufacturing of active pharmaceutical ingredients and intermediates with higher demand. Therefore, proper arrangement of production can not only improve production process and materials management, but also provide most efficient service, in terms of time, legal compliance, and market.

As both the Tainan plant and the Changshu plant have in-house R&D centers, ScinoPharm is capable of supplying upstream key intermediates and active pharmaceutical ingredients, giving it an edge of vertical integration. The company aims to provide products with the shortest development cycle and "interactive compound custom service," a one-stop shopping service for the marketing of new products, so as to meet the needs of developers of brand-name drugs and new drugs.

Lastly, the company is going to foray into the realm of injection preparations, as test run for the production line has been completed, following starting of construction work for hardware facilities in the second half of 2013 and completed several injection drugs registered batch lately. The Company developed several special injection drugs and will boast an operation of vertical integration covering APIs and injection drugs, driving sustained business growth.

• (4) Development plan for the Chinese market

China has already emerged the world's second largest pharmaceutical market, next to the U.S. In response to recent major changes in China's pharmaceutical legislations and system, the company has also adjusted its deployment strategy, in order to tap the pharmaceutical and preparations market in China.

• (5) Strategic alliance for drug development-march towards the realm of new drug development.

Take advantage of ScinoPharm R&D team's capability in synthesis and preparations, select new drugs with development potential as R&D subjects via evaluation from the angles of intellectual properties, technologies, and market need, and then upgrade the R&D capability for new-drug development, in preparation for marching towards the realm of new-drug development. Join hands with new-drug companies, via strategic alliance, in engineering new-drug development, cooperate with companies of quasi-new drug preparations in joint development of competitive 505(b)2 quasi-new drugs, or take part, as a specialized investor, in alliance for new-drug development, in which ScinoPharm can lead the development of process for active pharmaceutical ingredients, boosting the edge of the alliance. Finally, ScinoPharm can dominate new-drug development using structural features deriving from the active pharmaceutical ingredients developed and then team up with pre-clinical test or clinical-test operators in developing new drugs, gradually ushering the company into the realm of new-drug development.

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5.2 Market and Sales Overview

5.2.1Market Analysis

5.2.1.1 Major Products (Services) by Region

Unit: NT$ thousands ； %

Region	Year	2019		2020
		Amount	%	Amount	%
Abroad	US	594,128	21	623,535	20
	EU	881,330	30	1,181,234	38
	AU	44,356	2	16,073	1
	ASIA	1,275,494	44	1,119,990	36
	Other	0	0	60	0
	Subtotal	2,795,308	97	2,940,892	95
Domestic Market		97,475	3	142,036	5
Total Combined Revenue		2,892,783	100	3,082,928	100

• 5.2.1.2 Outlook of supply and demand in the market and growth potential

In recent years, due to increasing difficulty for new drug development and slackened sales on hefty price pressure, many pharmaceutical firms have resorted to acquisition and merger, in order to sustain growth. Via M&A, enterprises can not only obtain new technologies, new drugs, and intellectual properties but also lower the risk for new drug development. However, as M&A would affect the integration of supply chain, how to maintain the leading status for APIs and even injection pharmaceuticals amid M&As would pose as a major challenge to the company in the future.

Over the past years, ScinoPharm Taiwan has carved out a leading status, in terms of product variety and volume and customer service, on the global API market for cancer chemotherapy. Dividend from that status, however, has been thinning, in the wake of the emergence for new cancer therapies and the gradual maturity of biopharmaceutical (largemolecule drug) technology. Targeted drugs featuring the use of monoclonal antibodies and immunotherapy have proven to be significantly effective in tumor control. It is evident that thanks to their curative effect and low side effects, those relatively expensive largemolecule drugs will make major inroads into cancer treatment market in developed nations, at the expense of small-molecule chemotherapy drugs. Another potential approach is the coupling of small-molecule targeted drugs with molecular diagnostic technology. Compared with chemotherapy drugs, small-molecule targeted drugs are more concentrated and have to take into account tumor mutation and the use of new targets. The trend poses a major challenge to ScinoPharm Taiwan in market evaluation and product selection.

Moreover, in response to the demands of pharmaceutical firms for cancer injection drugs and strained supply of such drugs, a result of the increasingly rigorous legislative requirements worldwide which have constrained the operation of many injection-drug firms, ScinoPharm Taiwan has been endeavoring to extend its operation to injection-drug production in recent years, resulting in a vertical integration, so as to consolidate its presence on the cancer drug market.

However, with technological progress and the spread of confirmed chronic diseases, oral drugs have gradually emerged as mainstream administration of drugs. How to achieve a balance APIs in different forms and injection drugs in the allocation of limited resources will become a major issue in the development of pharmaceutical firms.

• 5.2.1.3 Competitive niche and development outlook

The company's competitive niche lies in: 1) high-caliber R&D team: Members of the company's R&D team major in disciplines of synthesis or analysis, mostly with doctorate degree, under the leadership of veteran managers. It is the most R&D team among domestic peers; 2) The company has reaped abundant R&D results, as mentioned

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previously (refer to (5.1.3 Technology and R&D status), the company owns multiple product patents worldwide and often publicizes research findings in academic journals, testifying to its R&D strength. 3) complete production facilities: For the purpose of pluralized functions, the company's production lines are capable of producing highly active pharmaceutical ingredients of cellular-toxin, steroid, hormone, and anti-cancer drugs. The R&D unit is furnished with a wide range of equipment, including nuclear magnetic resonance, crystal diffractometer, and mass spectrometer, enabling the company to overcome various barriers in producing unique active pharmaceutical ingredients; 4) seasoned operating skill: With veteran experience, operators can operate efficiently and effectively utilize solvents, reducing unnecessary expenses and thereby lowering cost; 5) good product quality: Thanks to complete process norms put forth by the R&D team and strict abidance by the GMP requirements, the company has firm grip of the production flow, resulting in good quality; 6) good customer relationship and competent marketing capability: Thanks to long-standing supply, regular visits to customers for understanding their needs, and meeting of customers' emergent needs, the company has established a relationship of mutual trust with customers, facilitating works of the marketing team; 7) complete after-sales legal support: As active pharmaceutical ingredients have to be subject to the inspection of regulators, the company actively replies to the concern of inspectors about active pharmaceutical ingredients and preparations, thereby facilitating the acquisition of generic-drug licenses by customers, which also benefit the company.

In addition to the aforementioned niche, the company stresses market segmentation in development strategy, as shown in its selection of development targets:

• A. Highly active and low toxic products

When processing highly active and low toxic chemicals, many producers of active pharmaceutical ingredients often create serious polluting and workplace-safety problems, disrupting supply to customers. ScinoPharm already installed sufficient protective facilities for highly active products from the outset at its factories. Despite the high cost for the facilities, they can augment the company's edge in producing highly actively products, such as steroid and toxic cellular compounds.

In view of the low-toxin requirement for injection drugs, the company is furnished with highly pure water supply system, capable of producing pure water similar to WFI (water for injection) in quality. As a result, ScinoPharm Taiwan's products boast very low toxin, another edge of the company. Industry insiders note that there are only a few companies capable of producing injection drugs on the market. Thanks to its manufacturing edge meeting market need, the company has been acknowledged as an injection-drug supplier, segmented from members of low-priced market. The company has become a reputed injection-drug supplier among international generic-drug pharmaceutical firms.

• B. Raw materials/products with difficulty to obtain from supply chain

To secure raw materials, the company embrace a mode similar to development of new products, wherein it joins hands with long-term partners in the R&D of raw materials, to assure stable supply of raw materials for mass production. For instance, the company has signed contract with Chinese-yew (Taxus chinensis) plantation for supply of 10-DAB, contained in the plant's leaves, which is needed for producing paclitaxel and docetaxel, the company's two major products. Therefore, despite price drop of 10-DAB following increase of qualified suppliers, the company has enjoyed steady supply of the material, giving it an edge of head start.

• C. Peptide

Thanks to gene sequencing, humans have more understanding of the function of genes and their association with peptide, paving the way for the rollout of more medicines containing peptide. Moreover, via constant improvement and progress in drug production, there will be increasing methods for transmission of peptide in human bodies, leading to rapid growth in the number of and demand for peptide medicines. In the past, annual market demand for peptide reached only several kilos, resulting in substantial idled capacity, a problem which has been substituted by strained capacity, thanks to rapid increase in demand in recent years. The traditional solid-phase peptide synthesis can be applied in mass production but the production equipment is expensive, on top of the

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high cost and disposal problem for the solvent needed for its purification. In addition to solid-phase peptide synthesis, the company has introduced the technology for forecasting solubility and the technology of continuous parallel purification, which greatly simplifies purification process and slashes the use of solvent. In addition, a chemical reaction is applied for final assembly of peptide, following the use of solid-phase synthesis, thereby eliminating the problem of connection caused by solubility issue. Finally, carry out reaction via traditional liquid-phase chemical reactor to change chemical polarity and produce sediment, thereby achieving convenient purification. This constitutes the company third technology for peptide production, featuring even reaction and simple separation and purification.

Furnished with aforementioned technologies, the company can apply optimal technology for different kinds of peptide medicines, which enable it to catch up with major suppliers of active pharmaceutical ingredients of peptide medicines, such as UCB, Lonza, Bachem, and Polypeptide, thereby breaking their oligopoly of the market, an outcome aspired by generic-drug companies or developers of new medicines.

• D. Injection drugs

ScinoPharm Taiwan specializes in the development and production of active pharmaceutical ingredients of anti-cancer medicines featuring high activity and high technological threshold. It is a leading supplier of raw materials for highly active anticancer injection drugs, with the largest variety of products in the field worldwide. Moreover, it has extended its operation to downstream production of injection drugs by building an injection-drug plant which meets the international cGMP standards.

Many cancer API customers need contract production service for cancer injection drugs, due to lack of sufficient capacities for manufacturing the drugs, but at present plants for contract injection drug production meeting international standard of cGMP have limited capacities only. Moreover, unable to meet the increasingly strict eGMP standard, many injection drug plants in the U.S. and Europe have received warning notice from the U.S. Food and Drug Administration (FDA), asking them to make improvement by a deadline or suspend operation, which has aggravated the situation. In addition to quality, stable delivery has become a major consideration for generic-drug firms in seeking business partners. Under the environment, provision of a one-stop shopping service covering APIs and injection drugs can not only consolidate and expand ScinoPharm's existing API business but also enhance the company's long-term competitiveness and growth potential.

Facilities of the company's injection-drug plant, situated in Tainan Science Park, have been completed. The plant consists of the operational sections of R&D, quality control, cleansing, sterilization, manufacturing, filling, freezing and drying, packaging, and warehousing, capable of producing injection drugs in various forms, including bottled liquid, bottled frozen dried powder, and injection drugs filled in syringes.

The transformation is meant to provide value-added service to customers, without causing conflict with customers' business. The plant will boast versatile functions, including contract manufacturing service for existing customers of active pharmaceutical ingredients, development of own medicines, registration and production of injection drugs for sale to customers, and custom service for international pharmaceutical firms.

• 5.2.1.4 Favorable and adverse factors for development outlook

• A. Favorable factors:

• a. Government policy

The Chinese government amended GMP regulation in 2010, with the revised edition forcing less competitive pharmaceutical makers to withdraw from market, invest in improving manufacturing, or undertake corporate restructuring including via merger. In comparison, the new GMP regulation is favorable to healthy pharmaceutical makers.

At the end of 2015, the Chinese government issued a decree calling for intensifying the screening of imitation medicines and the review and approval of modified new medicines, improving the review and approval of clinical test, concentrating the review and approval of medicines of the same category, permitting applications to withdraw applications for unqualified medicines, strictly screening the safety and effectiveness of medicines, speeding

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up the screening and approval of medicines in urgent need for clinical tests, permitting the request for clinical test and medicine application before the expiration of patents, strictly penalizing faking of clinical tests, inducing rational applications, and regulating review of medicine registration. These measures ae meant to reform the review and screening system for medicines. One key objective to enhance the quality of imitation medicines. As a result, the medicine review and screening system of China will link up with the international practice, facilitating the development of companies meeting international norms in the market.

In its 12th five-year national development plan, the Chinese government has set a 20% annual growth target for the nation's medicine market and encourage enterprises to build high-caliber plants, boosting the edge of its medicine industry. Another objective is to link China's biomedicine industry with the world. According to the seventh national census, publicized by the National Bureau of Statistics of China, China's total population stood at 1,411.78 million as of Nov. 1, 2020, including 264.02 million aged 60 or older, for a share of 18.70%, 5.44 percentage points higher than 10 years ago, exhibiting the trend of an aging society. The country will continue to face the challenge of keeping a balanced population growth in the long run.

The aged population has high demand for medical and hygiene service, as aged citizens are more vulnerable to disease due to weaker immune system. Presently, the aged 40-50% of the over-the-counter medicine market. Prompted by the rosy outlook, the company started to deploy in the Chinese market several years ago.

In October 2015, the talk on TPP (Trans-Pacific Partnership), spearheaded by the U.S., resulted in an agreement on medicine norm, which will be based on the Hatch-Waxman Act of the U.S., in the close linkage between patents and medicine applications, facilitating the extension of the company's operation to other markets, due to its focus on the U.S. market. Passed in 1984, the U.S. Hatch & Waxman Act encourages in principle the application and usage of generic drugs, helping the latter achieve 70% market penetration rate in the U.S. (For every 100 prescriptions, 70 use generic drugs). The implementation of the "Patient Protection and Affordable Care Act," or known as "Obamacare," following its passage in March 2010, has further boosted the development of generic drugs.

• b. Accelerated approval for marketing of new medicines and generic drugs

• In 1992, the U.S. FDA promulgated the "Prescription Drug User Fee Act" (PDUFA), requiring pharmaceutical firms to pay fees to the FDA when applying for approval of new medicines, generating several tens of millions of U.S. dollar of extra income for the FDA for use in accelerating approval of applications for new medicines. Consequently, the majority of new drug applications (NDA) now need only one review cycle for approval, half of the previous duration.

In 2012, the "Generic Drug User Fee Amendments" (GDUFA) was promulgated, according to which pharmaceutical firms have to pay screening fee and fee for the cost of inspection facilities for applying the approval of generic drugs. The act has boosted the efficiency of the FDA in screening and approving applications for generic drugs, slashing backlog of applications awaiting approval, and shortening average screening time, on top of additional risk check, facilitating marketing of generic drugs and enabling the public to access safe and effective generic drugs. The proposition of GDUGA was prompted by the success of PDUFA, which had helped patients obtain safe and effective new prescription drugs more rapidly. The implementation of GDUFA has facilitating obtaining of information on generic-drug manufacturing facilities and sites worldwide, augmenting the safety of global supply chain.

• c. Secure supply sources for key materials and cooperate closely with customers to speed approval of marketing for products

• On the global prescription-medicine market, some active pharmaceutical ingredients most demanded by generic-drug pharmaceutical firms are very difficult to come by or are very difficult for certification and analysis. As a result, the market of generic drugs is still often in the firm grip of the original patent owners, despite the expiration of the patents. Therefore, in addition to effective planning for the sources of active pharmaceutical ingredients, the company has invested, in terms of manpower and fund, in related analytical work and actively cooperated with customers in obtaining approval of the marketing of medicines within the shortest time possible, thereby facilitating the company's development.

• d. Complying with cGMP norm

• Pertaining to contract manufacturing of active pharmaceutical ingredients, despite higher cost than mainland Chinese and Indian counterparts, the company stands out on emphasis on

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patents and intellectual properties, cutting-edge facilities compliant with U.S. cGMP norm, in both hardware and software, and business mode and language compatible with the West. In China and India, only some large pharmaceutical firms can meet the requirements of quality and regulations in the U.S. and Europe, while great majority of companies there are incapable of large-scale investments for building plants compliant with the cGMP standard in the U.S. and Europe.

B. Adverse factors

a. Price competition for generic drugs

Generic drugs refer to drugs with expired patents, enabling pharmaceutical firms other than original patent owners to produce, following approval, drugs with similar ingredients, dosage type, dosage amount, and curative effect. The scramble for the generic-drug market among pharmaceutical firms has driven downward their prices, thereby dampening prices of active pharmaceutical ingredients and the gross margin of their manufacturers. Countermeasure:

The development of new generic drugs is a key strategy of ScinoPharm Taiwan, which selects development targets via analysis of market potential and possible competition. The company has been rolling out a number of generic drugs every year, focusing on those drugs which feature active pharmaceutical ingredients with high technological threshold, speedy R&D for synthetic method, and efficient process technology, so as to tap the market opportunities emerging after the expiration of patents. Following mass production, the company would continuously improve process technology, secure supply source for raw materials, and farm out front-end processing, so as to cut production cost. The company even develops process technology with cost lower than original patent owners, while upholding the purity and safety of products.

In general, the company would develop process technology for active pharmaceutical ingredients in one year following approval of original patent owners and then provide samples to generic-drug customers for conducting tests necessary for registration, in an effort to become their first supplier of active pharmaceutical ingredients. After setup of the partnership, the customers would need the approval of FDA for changing suppliers of active pharmaceutical ingredients, which would take two years and entail extra investments. The stable long-term partnership would help the company keep its overall gross margin at an adequate level.

Meanwhile, the company is building an injection-drug plant at the site of its existing Tainan plant, which will also accommodate the R&D on active pharmaceutical ingredients and preparations. Carry out integration of upstream and downstream operations to bolster the value of ScinoPharm's active pharmaceutical ingredients and the gross margin of its products, to cope with prices of generic drugs and active pharmaceutical ingredients trending downward. There are some 300 dedicated manufacturers worldwide capable of producing active pharmaceutical ingredients conforming to the standard set by the U.S. FDA. Only some 20 of them can provide highly active anti-cancer injection drugs, including ScinoPharm which boasts the largest product lineup in the pack, a market segmentation which constitutes a strong edge for the company in developing preparations and new anti-cancer medicines. As for active pharmaceutical ingredients, the company selects items featuring high technological threshold for early development and applies for patents for protecting process and crystal forms, upholding its edge. The development of preparations enables the company to take into account the schedule and steps for R&D on preparations in the R&D on active pharmaceutical ingredients enabling the company to have better grasp of the schedule for the marketing of drugs, compared with peers. The complete planning, on top of the market segmentation and timeliness for active pharmaceutical ingredients will furnish the company with a stronger edge than peers.

b. Price competition from China and India

Taking advantage of their low manufacturing-cost edge, China and India produce bulk generic drugs with low added value. Via imitation synthesis technology, India has grasp organic synthesis chemical technology and embraced low-price strategy in penetrating emerging markets.

Countermeasure:

Since its establishment, the company has targeted market of products featuring high technological threshold, such as active pharmaceutical ingredients for anti-cancer injection

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drugs. The company has been actively developing next-generation production technologies with higher efficiency, in order to supply active pharmaceutical ingredients at reasonable prices and help customer augment market competitiveness, while upholding the company's dominating status on the global market of active pharmaceutical ingredients.

The company specializes in special pharmaceutical ingredients featuring high technology, high price, and high activity. The Taiwan plant already passed seven times of inspections by the U.S. FDA and the certification of the hygienic agencies of various countries, while the Changshu plant in China has also passed inspection by the FDA. In addition, the company has conducted rigorous control and management of public safety, hygiene, and the stability of process technology, to prevent intellectual-property infringement and harm to environmental ecology, while assuring stable supply. The purpose is to create a quality repute for the company's products, thereby upholding their competitive edge and assuring business performance and growth.

ScinoPharm has shipped active pharmaceutical ingredients to Europe and the U.S. for many years, accumulating abundant experience in compilation of product information, inspection and certification registration (such as DMF registration for active pharmaceutical ingredients), communications with regulators, and reply to official documents, which enables the company to provide legal and technological service to customers. The expertise has given the company a strong edge, as customers invariably expect abundant legal experience from suppliers of active pharmaceutical suppliers capable of replying to regulators quickly, so as to speed up the screening and marketing of drugs.

• c. Laws/regulations on drug production feature strict standards and demand multiple inspections, as a result of which marketing of drugs has often been delayed, should the quality of their active pharmaceutical ingredients be doubted.

• On top of protracted R&D process, as drugs are meant for application inside human bodies, the safety and effectiveness of active pharmaceutical ingredients are subject to rigorous screening and check of the regulator and have to pass certification before marketing. The end result is heavy pressure of development schedule and funding requirement, which often entrap small enterprises in financial difficulty.

Countermeasure:

The company has set up a legal unit for pharmaceutical affairs, in charge of import-related documents demanded by hygiene agencies of import countries or areas for approval of local sales. The company carries out internal auditing periodically, to assure compliance of the company's operation and internal procedures with cGMP standard. The regulationcompliance unit is in charge of affairs related to official inspection and customer auditing, cGMP education and training for staffers, stability testing plan, and annual product inspection. The company's quality assurance and control unit is responsible for the checking and testing of all products and samples, including raw materials, initiators, samples in process, and finished products, to assure compliance with set specifications. Since the company mainly produces pharmaceutical ingredients with high activity for anti-cancer injection drugs, monitoring and control of the water-supply system and manufacturing environment is crucial, in order to control the amount of particulate matters and microbes in equipment, to avoid contamination of medical-use pure water. In addition, the quality-control unit will stability test for samples, to assure that they are not affected by contamination of the external environment. Therefore, the company have fully prepared for meeting the strict standards of related laws/regulations for pharmaceutical production, enjoying a strong edge over peers.

• d. In order to postpone the stocking up of generic drugs after their marketing, original patent owners tend to file suits for patent infringement.

As innovation and R&D is the core competence of the biomedicine industry, pharmaceutical firms would spare no effort in prevent infringement of their intellectual properties by competitors. In order to safeguard their market share, original patent-owning firms would file suit related to patents or intellectual-property infringement, blocking stocking up by genericdrug firms or shipment by suppliers of active pharmaceutical ingredients. Countermeasure:

The company strictly abides by the U.S. and international standards on intellectual-property right. For active pharmaceutical ingredients, process-technology patent is the most noteworthy intellectual property. A generic-drug firm may be sued by the original patentowning firm for intellectual-property infringement, should it use active pharmaceutical

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ingredients implicated in infringement of process-technology patent. In order to avoid encroaching on others' intellectual properties, the company develops most of its patents by itself and licenses technologies from patent owners, when necessary. The company is furnished with advanced patent-searching software and subscribes to related services, to assure avoidance of infringing existing or expiring patents. In addition, it employs U.S. patent lawyers to provide legal protection of chemical process technologies. Meanwhile, it provides complete technological support to customers in product-marketing registration, minimizing the impact of the adverse factor.

5.2.2 Important usages and production process of major products

• 5.2.2.1. Important usages of major products

In the industry of active pharmaceutical ingredients, the success or failure of a company hinges on the success or failure of product development, for which the ability of a company in choosing right products and developing them according to schedule is crucial. In product selection, ScinoPharm takes into account customer orientation, market need, size of revenue, patent restriction, ability of technology and facilities, production cost, access to raw materials, workplace safety, and environmental protection. Priority is place on those products for which ScinoPharm owns cutting-edge technologies and has control of source of raw materials, on top of less competition, high margin, and strong need by customers.

In order to speed up the pace of R&D, in addition to the utilization of solid in-house R&D strength, the company also entrusts a number of domestic and foreign research bodies for initial R&D or establishment of platform technology. Up to now, the company has successfully developed more than 20 products via cooperation with 10 domestic and foreign research institutions, the latter mainly academic and research units in mainland China. From those cases, many technologies have been transferred to the company as initial technologies for amplification and the company has applied patents for them. In 2011, the company incorporated its Kunshan subsidiary in China's Jiangsu Province, set up in 2001, into ScinoPharm (Changshu) Pharmaceuticals in China, while recruiting excellent chemical and chemical-engineering specialists in China for R&D and operating pilot plant for producing key materials and intermediates. ScinoPharm (Changshu) Pharmaceuticals has not only helped ScinoPharm cut production cost but also integrated cross-strait resources for R&D, production, and management, on top of enriching its international management experience. ScinoPharm (Changshu) will be positioned as international plant for active pharmaceutical ingredients and parent company's operating base in China, which will provide large volume of quality active pharmaceutical ingredients and all-round R&D and contract manufacturing service, giving ScinoPharm a strong backing in its effort to expand international service.

In view of the acute competition in the market of active pharmaceutical ingredients, the company chooses active pharmaceutical ingredients featuring high technological threshold and high prices for early development. The focus is on pharmaceutical ingredients featuring high activity for anti-cancer drugs, which have a high-growth market. Major usages, in terms of their shares, for the company's development products are listed below:

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5.2.2.2. Production process of major products

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5.2.2.3 Supply status of major raw materials

As a dedicated manufacturer of active pharmaceutical ingredients, the company is very demanding for the quality of raw materials, in order to uphold the stability of the quality of products. It requires suppliers, once selected, to comply with the need of production. The relationship between the company and suppliers is based on long-term cooperation, which will not be changed easily. Meanwhile, to avoid disruption of supply, the company has also been continuously seeking alternative suppliers to meet emergent situation.

5.2.2.4 Information on major suppliers/clients who have accounted for at least 10% of sales/procurement in either of the past two years

A. List of suppliers that have accounted for at least 10% of procurement over the past two years:

Unit: NT$ thousands; %

									Unit: NT$ thousands; %	Unit: NT$ thousands; %	Unit: NT$ thousands; %	Unit: NT$ thousands; %
Item	2019				2020				2021 First Quarter
	Company Name	Amount	Percent	Relation with Issuer	Company Name	Amount	Percent	Relation with Issuer	Company Name	Amount	Percent	Relation with Issuer
1	-	-	-	-	U Supplier-	109,157	14%	none	-	-	-	None
	Others	467,264	100%	None	Others	688,117	86%	None	Others	216,120	100%	None
	Net Supply	747,390	100%		Net Supply		100%		Net Supply	216,120	100%

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B. List of clients that have accounted for at least 10% of sales over the past two years:

Unit: NT$ thousands; %

									Unit: NT$ thousands; %	Unit: NT$ thousands; %	Unit: NT$ thousands; %	Unit: NT$ thousands; %
Item	2019				2020				2021First Quarter
	Company Name	Amount	Percent	Relation with Issuer	Company Name	Amount	Percent	Relation with Issuer	Company Name	Amount	Percent	Relation with Issuer
1	BSP	435,762	16	None	Customer B	399,293	14	None	Customer A	168,960	28	None
2	Itochu	425,669	16	None	Customer A	398,198	13	None	Customer D	72,199	12	None
3	-	-	-	-	Customer C	354,827	12	None	Customer C	59,852	10	None
	Others	1,869,988`	68	None	Others	1,792,314	61	None	Others	310,169	50	None
	Net Sales	2,731,419	100	-	Net Sales	2,944,632	100	-	Net Sales	611,180	100	-

Explanation for change in sales:

1. Sales for A customer decreased, due to decreased demand for APIs used in the production of new drugs.

2. Sales for B customer decreased, due to decreased demand for APIs used in anticancer products.

3. Sales for C customer increased, due to increased demand for Anti-depression drugs.

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5.2.2.5 Production in the Last Two Years

Unit: Kilo / NT$ thousands

				Unit: Kilo / NT$ thousands	Unit: Kilo / NT$ thousands	Unit: Kilo / NT$ thousands
Year Output Major Products	2019			2020
	Capacity	Quantity	Amount	Capacity	Quantity	Amount
API	88,322	38,648	1,747,531	113,103	57,030	2,048,827
Total	88,322	38,648	1,747,531	113,103	57,030	2,048,827

Note: The company capacity and output vary according to difference in the production of product combinations.

5.2.2.6 Shipments and Sales in the Last Two Years

Unit: Kilo / NT$ thousands

					Unit: Kilo / NT$ thousands	Unit: Kilo / NT$ thousands	Unit: Kilo / NT$ thousands	Unit: Kilo / NT$ thousands
Year Shipment & Sales Major Products (or by department)	2019				2020
	Local		Export		Local		Export
	Quantity	Amount	Quantity	Amount	Quantity	Amount	Quantity	Amount
API	574	81,200	27,896	2,512,017	184	137,849	28,034	2,660,461
Injections Products	-	-	95,924	138,202	-	-	122,060	146,322
Technical Services	-	16,275	-	100,485	-	4,187	-	94,488
Other operation income	-	-	-	44,604	-	-	-	39,621
Total	574	97,475	123,820	2,795,308	184	142,036	150,094	2,940,892

Note 1: Income from active pharmaceutical ingredients increased, due to increased demands from customers.

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5.3 Human Resources

As employees are an enterprise's most important partners for sustained development, ScinoPharm Taiwan has been providing, in a friendly, open, and equal manner, providing employees fair development opportunities via human-resources management, thereby fulfilling the fundamental commitment to international human-rights standard and behavioral guidelines and creating a working place with assured safety, respect for plurality, and gender harmony. ScinoPharm Taiwan is a world-class pharmaceutical plant and engaged in a knowledge and technology-intensive line, a feature which has been reflected in its manpower structure. As of April 30, 2021, the company and its subsidiaries had a workforce of 865, compared with 882 in 2020.

5.3.1 The Company

	Year	2019	2020	2021.04.30
Number of Employees	Executive Officers	87	88	102
	Professionals	250	283	287
	Technical personnel	259	270	259
	Administration Personnel	35	38	25
	Total	631	679	673
Gender	male	71%	71%	70.6%
	Female	29%	29%	29.4%
	Average Age	38.6	39.37	39.08
Average Years of Service		8.65	9.01	9.19
Education	Ph.D.	5.86%	5.30%	5.47%
	Masters	34.55%	35.79%	36.09%
	Bachelor’s Degree	51.98%	51.10%	50.89%
	Senior High School (include under Senior High School)	7.61%	7.81%	7.54%

5.4 Environmental Protection Expenditure

The company has spared no effort in combating environmental pollution, including installation of airpollution prevention equipment, such as condenser and scrubbing tower, as well as waste-water treatment devices, such as membrane reactor, column-stripping waste liquid distillation system, and Strathtox activated sludge respirometer. Alleviation of environmental pollution can reduce outlay for waste processing, complies with legal requirement and customer demand for API (active pharmaceutical ingredients) plant in treatment of high toxic waste liquid or waste water, and augments the company's competitiveness in the API industry.

5.4.1 Any losses suffered by the company in the most recent fiscal year and up to the annual report publication date due to environmental pollution incidents (including any compensation paid and any violations of environmental protection laws or regulations found in environmental inspection, specifying the disposition dates, disposition reference numbers, the articles of law violated, and the content of the dispositions): None

• 5.4.2. Investment in major environmental pollution-abatement equipment, their usage, and possible benefits:

• (1) Existing polluting status: According to the kinds of pollutants, the major polluted sections of the company and affiliates can be classified into the three major categories of air pollution, waste water, and wastes.

  • A. Air pollution: In 2020, the company spent NT$2 million in environmental protection in improvement waste-air collection method of mobile equipment and waste-air

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treatment equipment, such as scrubbing tower.

In addition, the company spent NT$100,000 on air-pollution abatement a year, on top of NT$60,000 a month by affiliates.

• B. The company invested NT$500,000 in environmental protection in 2020 in replacement of corroded waste-water pipes of Bay3 TK-3075 waste-water tank and outdated waste-water SUMP tank, to avoid waste-water leakage, polluting soil or groundwater.

• C. Waste: The company invested NT$200,000 in environmental outlay in 2020 in sheds for temporary deposit of wastes, to avoid polluting soil or groundwater.

• In order to cut discharge of waste solvent during the process, the company has dedicated to stripping-column waste abatement treatment, using stripping column to separate water phase and organic phase in high water-content waste liquid and discharging water phase to waste-water treatment plant, thereby reducing organic phase, or waste solvent, significantly. The company spent NT$3.5 million on treating 90 tons of waste liquid via stripping column, plus treatment of 0.61 tons a month by affiliates via the same method.

The company 2020.12.31 ； Unit: NT$ thousands

The company				2020.12.31；Unit: NT$ thousands
Name of equipment	Acquisition date	Investment cost	Balance of value after depreciation	Usage and expected benefit
Production building, Technology building waste-air treatment equipment improvement work	2020.6.30	270	2,557	environmental protection in improvement waste-air collection method of mobile equipment
replacement of corroded waste-water pipes of Bay3 TK-3075	2020.8.24	227	645	Replacement of corroded waste-water pipe to avoid environment pollution
replacement of outdated waste-water SUMP tank for waterproof	2020.9.14	146	4725	Replacement of outdated waste-water SUMP tank for water proof
Improved equipment for collecting the unprocessed waste air to scrubber	2020.12.1	1,411	659	Improvement waste-air treatment equipment, uch as scrubbing tower.

Company of equity investment in China 2020.04.30 ； Unit: RMB thousands

Company of eq	uity inves	tment in Ch	ina		2020.04.30；Unit: RMB thousands
Name of equipment	Amount	Acquisition date	Investment cost	Balance of value after depreciation	Usage and expected benefit
Waste-water treatment system	1	2010.08.01	RMB2,275	RMB739	Waste-water treatment system, in order to comply with the regulation
Scrubber	7	2011.01.01 ~ 2013.02.01	RMB147	RMB66	For use in air-pollution abatement and reduction of emission of pollutants, in order to safeguard human health and cut air-pollution fee.
Cooling tower	1	2018.02	RMB284	RMB263	Application in air-pollutant abatement for cutting the emissionofpollutants
Waste-water can	1	2018.03	RMB114	RMB106	Waste-water treatment system, in order to complywiththeregulation
Early warning for flammable gases	1	2018.03	RMB153	RMB143	Prevention of leakage of flammable gases
VOC gases online detecting System	1	2019.08	RMB 224	RMB 217	Prevention of leakage of gases
Waste-water storage reservoir	1	2019.12	RMB 121	RMB 121	Waste-water treatment system, in order to complywith the regulation

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• 5.4.3. Describe the company's effort in improving environmental pollution in recent two years and as of the date of the publication of the annual report, as well as pollution-related disputes and their handling, if any: Nil.

• 5.4.4. Describe, in recent two years and as of the date of the publication of the annual report, the total amount of the company's loss (including compensation) and fines from environmental pollution, as well as its countermeasures (including improvement measures) and possible outlays (including estimated value of possible loss, fines, and compensations in the absence of countermeasures; make explanation, should the value be unable to be estimated reasonably): Nil.

• 5.4.5. Existing polluting status and the effect of its improvement on the company's earnings, competitiveness status, and capital outlay, as well as forecast on capital outlays for environmental protection in the coming two years:

• (1) Existing polluting status: According to the kinds of pollutants, the major polluted sections of the company and affiliates can be classified into the three major categories of air pollution, waste water, and wastes.

  • A. Air pollution:

  • B. Waste water: In 2020, the company spent around NT$500,000 under the cause of environmental-protection outlay for repair of the corroded. Water pipeline and old sump tank of Bay3 TK-3075 waste-water bank to avoid leakage, which may pollute soil and ground water.

  • C. Waste: In 2020, the company spent NT$200,000 under the cause of environmentalprotection outlay for improving shaded waste storage area to avoid pollution of soil or groundwater by deposited waste.

• (2) Effect of improvement of environmental pollution on the company's earnings, competitive status, and capital outlay:

  • In an all-out effort for combating environmental pollution, the company has invested heavily in air pollution-abatement equipment, including condenser, scrubber, and activated carbon absorber, and waste-water treatment equipment, such as membrane bioreactor, steam stripper, waste-liquid distillation system, and Strathtox active mud respiratory device. Abatement of environmental pollution can cut outlay for waste treatment, boosting the company's earnings, and meet the requirements of laws/regulations and customers on the treatment of toxic waste liquid and waste water by API (active pharmaceutical ingredients) plants, augmenting the company's competitiveness.

• (3) Planned major capital outlays for environmental protection in the coming two years: Both the company and the affiliates have no plan for the related investment.

5.5 Protective measures for workplace and personal safety of employees

To enhance autonomous management capability for safety and hygiene, the company has passed entirely the systematic certification of the management guidelines of the Taiwan Responsible Care Association (TRCA) SINCE 2007, including safety management of contractors, distribution management, product management, emergency response management, process safety management, waste management, and reduction management, as well as the acknowledgement by the vocational safety and hygiene management system for enterprises of the Ministry of Labor. Meanwhile, in line with the features of pharmaceutical business. To shield employees from exposure to the hazard of potent compound handling. In 2009, the company passed the certification of activated pharmaceutical operating system by international third fair party SafeBridge and has been maintaining and improving the operation according to the criteria of SafeBridge ever since. The company has been striving to build up a comfortable and safe working environment, free from accident, via participation in the operation of safety and hygiene management system by all staffers, enforcement of various safety and hygiene management measures, and the use of such tools of hazard detection, risk assessment, and risk control.

Related workplace, personal-safety measures, and supervisory measures of ScinoPharm are listed below:

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• Status of dedicated units or staffers for safety/hygiene and environmental management

The company has set up "vocational safety and hygiene committee" and "sustainable management committee." The former, set up according to "vocational safety and hygiene management measures," is the supreme policy-making unit for environment, safety, and hygiene affairs. It is convened by the president and consists of tier-one chiefs of various business units and plants, chiefs of various sections, and representatives of employees. The committee convenes quarterly to review the company's affairs related to environment, safety, and hygiene, thereby putting forth key directors for improvement. The latter coordinates the company's effort in environmental protection, safety/hygiene, energy conservation, water-saving, and management of greenhouse-effect gases, in order to boost the company's competitiveness for sustainable development. Convened by the vice president in charge of production, the committee consists of the five functional sections of distribution and sales, health, safety, waste reduction, and energy conservation and puts forth sustainable development plan and review on the effect of implementation every year, for internal inspection. The goal is to strength the company's foundation for development, via safeguarding employees' health, creating a safe and friendly workplace, and incorporating environmental protection into the company's agenda.

• Control of the hazard of active pharmaceutical ingredients

For controlling the exposure to the hazard of active pharmaceutical ingredients, the company embraces common management mode among pharmaceutical firms worldwide. The mode calls for setup of exposure ceiling for active pharmaceutical ingredients and grading of hazards, planning for engineering protection for different grades of hazards, definition of the use and management of engineering-protective measures, and measurement of the effectiveness of the function and operating environment of engineering protection, the latest for ascertaining the sufficiency of engineering protection for different grades of hazards and the need for improvement or upgrading. In order to correctly identify the grades of hazards of active pharmaceutical ingredients and determine the exposure ceiling for active pharmaceutical ingredients, the company has set up an evaluation panel consisting of in-house and external experts in pharmacy, toxicology, chemical, and industrial hygiene for the task. Meanwhile, in order to assure protective engineering measures attaining expected containment, the company has established method for air sampling for analysis, by its own or outsourcing, carried out sampling via ISPE practice guide, for evaluating the actual effect.

• Management of process safety

To prevent unacceptable risk of process hazard during the stages of R&D through mass production, embrace four-stage analysis for process hazard: analysis of process hazard at laboratory (Lab PHA), analysis of intrinsic hazard (PHA1), analysis of reactive hazard (PHA2), and analysis of operating hazard (PHA3). Meanwhile, for evaluating safety issue resulting from thermal hazard induced by chemical reaction, carry out safety-test analysis with such laboratory equipment as differential scanning calorimeter, reaction calorimeter, and adiabatic calorimeter, in addition to conducting hazard forecast for chemicals without sufficient toxicological data with pharmaceutical-toxin forecast software Derek for Windows.

Change management procedure to evaluate and lower potential risks connected with modification of process engineering change. For control of operating safety, there have been norms for hazardous operations, such as procedural document for hazardous-operation permit, document for locking/tagging operational procedure, and document for restrictive-space operating procedure.

For in-plant use of chemicals, control its inventory at safe level and put in place standard procedure for separate bottling, with complete personal protective gear ready for use by operators, to assure safety in the use and stockpiling of chemicals.

• Emergency response management

To assure effective response to and removal of accidents, install three-stage emergencyresponse mechanism: initial accident-handling stage, emergency response and handling stage, and major disaster management stage. Since emergency response is a comprehensive incident, in addition to two whole-place drills, there are nighttime drills and drill for dispersal without alert, with the drills covering not only employees but also staffers of contractors stationed in the plants. Moreover, install the mechanism of emergency-response and disaster-relief experts by providing

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long-term training of disaster-relief skills to staffers selected by various plants, so as to carry out rapid and effective emergency response and disaster relief.

• Monitoring of operating environment

For detecting operating environment, formulate operating-environment detection plan containing sampling strategy, which starts with basic data collection and check of raw materials, process procedure, and hazardous materials, to be followed by observation, interviews and recording, investigation, planning of similar exposure groups, and sampling of staffers with largest chance of exposure. Detection items include CO2, noise, and organic solvent.

Meanwhile, in line with the features of the pharmaceutical industry, in order to shield staffers from the exposure to hazard resulting handling active drugs, set up air-sampling method for analysis, by its own or outsourcing, which adopts the aforementioned procedure for detecting operating environment, to evaluate the effect of exposure to hazard.

• Training for industrial safety, hygiene, and environmental protection

To strengthen staffers' concept of industrial safety, hygiene, and environmental protection and prompt them to continuously strengthen and improve the safety of their own operating environment, in addition to holding legally required courses, the company formulate educational and training program on industrial safety, hygiene, and environmental protection according to actual needs inside the plants, the company also conduct related courses regularly or irregularly, so as to intensify the responsibility and awareness of staffers for industrial safety and hygiene.

• Management of contractors

Integrate the information on the management of contractors via the e-contractor management system, so as to actually control the number of contractor staffers, as well as their authorized rights, entering the plant compound, in order to intensify admission control and enhance the efficiency of industrial safety and dispersal of staffers for emergency response. In addition, contractors are required to convene related units for safety meeting before start of construction works, as well as tool-box meeting daily, informing related workers, orally or in written form, on noticeable items for safety and hygiene. All contractors are required to carry out safety-protective and control measures for construction works, in line with the requirements set out in the document on the procedure for hazardous-operation permit.

• Augmentation of employee health

To safeguard the health of staffers and shield them from the risk of exposure to hazard in operation and contraction of vocational diseases, in addition to provision of various protective equipment and semi-annual detection of operating environment, arrangement regular physical exam for staffers, including management and rank-and-filers, clinical service, promotion and provision of breastfeeding space, and the provision of messaging service to relieve the pressure of staffers, so as to strengthen staffers' immunity from diseases and work efficiency. Moreover, under a care-responsibility framework, set up a task force for review of employee health and sponsor health-enhancement events irregularly, so as to prompt staffers forming the habit of regular exercise, via the encouragement and inducement of organization, for upholding their physical and mental health and vigor. In addition, with an eye on enhancing the awareness of own health management among staffers, the infirmary conducts various health lectures and promotional events for health enhancement.

• Establishment of safety culture

In order to establish a safety culture with rank-and-file basis, push all staffers conducting comprehensive internal safety observation. Pushing the MBWA (management by walking around) practice for production security chief, calling for one field inspection every two weeks by chief of production department, under the company of production management, director, and EHS (environment, health, and safety) staffers, including on-site discussion with colleagues, to demonstrate the management's high regard for safety and arouse safety awareness among employees. Meanwhile, have on-site operators take part in the discussion for pushing safety risk evaluation or analysis of product/process hazard, to prevent increase of hazard risk resulting from discrepancy of recognition between the result of the discussion and actual operation.

In order to boost autonomous management capability, the mainland Chinese company invested by the company has conducted certification of standard corporate-safety management system

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for hazardous chemicals, including safety management for contractors, distribution management, product management, emergency response management, process safety management, and waste management and reduction management. Meanwhile, in line with the features of pharmaceutical business, the mainland Chinese company has had SafeBridge, an international fair third party, audit the system and has improved the system according to the opinions of SafeBridge auditors, so as to shield employees from exposure to the hazard of potent compound handling. The mainland Chinese company has been striving to build up a comfortable and safe working environment, free from accident, via participation in the operation of safety and hygiene management system by all staffers, enforcement of various safety and hygiene management measures, and the use of such tools of hazard detection, risk assessment, and risk control.

5.6 Labor Relations

5.6.1 The company's various employee welfares, advanced study, training, and retirement system and their execution, as well as labor-management agreements and various measures upholding employee rights and interests

1. Employee Benefits:

In order to create a good and harmonious working environment, actively provide employees various caring measures, on top of legally required measures, such as labor insurance and health insurance:

• (1) Sound corporate regime: There are set measures governing promotion, award/penalty, performance appraisal, leave, and salaries and related operational and management regulations are upgraded timely, in line with change of laws/regulations, so as to assure legal compliance of business activities, consolidate corporate management, and safeguard employees' interests.

• (2) Fair, reasonable, and competitive compensations system: Continuously appropriate a set portion of earnings as employee compensations, and provide performance bonus and year-end bonus to employees. In addition, multiple incentives are available to encourage good performance, on top of compensations regime addressing both internal fairness and external competitiveness, for retention of excellent talent.

• (3) Multiple fringe benefits: In line with legal requirement, establish employees' welfare committee, appropriate employee welfare fund, and push contracted stores, employee clubs, annual employee travel, and other activities promoting employee exchange, on top of provision of subsidy for employee study, scholarship for employees' children, subsidies for child birth and child care, bonuses for Spring Festival, Dragon Boat Festival, and Mid-Autumn Festival, and free company bus and parking space.t Festival, and MidAutumn Festival, as well as free commuting bus and parking space.

• (4) Plan for promotion of employee health: In addition to mandatory insurance for employees, the company has also taken out various group insurances for their families, including life insurance, injury insurance, medical insurance for accidental injuries, and insurance for major diseases. Moreover, the company arranges physical check for employees every year and has medical staffers track the health status of employees continuously, on top of other health betterment activities, such as lectures on health issues, weight loss, and hiking. To promote balanced diet among employees, the employee restaurant pays much attention to the nutrition of meals and safety of foodstuff, striving to achieve a balance between caloric value and nutrition.

• (5) Secure and friendly workplace: In addition to a flextime, enabling employees to take good care of family and work simultaneously, a well-furnished breastfeeding room and special parking space for pregnant employees are available. There are massage therapists stationed in the plant to give employees timely relief from their works, as well as contracted consulting service, to help employees handle their troubles in work, daily life, or health.

• (6) LOHAS (lifestyles of health and sustainability): Hold employee well-being month and family days, for exchanges among employees and their families; subsidize employee clubs, to encourage hobbies and activities among employees in their leisure time and cement employee bond.

• Advanced training

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As a demonstration of its high regard for talent cultivation and in line with strategic humanresources management and the need of organizational development, the Company, in addition to on-the-job training, has arranged professional management courses, for the purpose of enhancing management skills and work performance, supplemented by oneon-one coaching and instruction, job rotation, and project assignment, in the hope of strengthening the expertise of individual employees at various levels and improving the execution performance of teams.

As for professional expertise and knowledge, conduct internal or external training on GMP quality system, environmental protection, industrial safety, and hygiene, whose execution is also incorporated into ERP system for management and regular tracking:

• (1) Business and management training:

• Upon its inception, the company already established Professional Management Training (PMT) system, designing tailor-made courses for managerial staffers at various levels and cultivation of other talents, which is supplemented coaching by senior superiors for dissemination of corporate culture, facilitating passing of experience and attaining sustainable development of the company.

• (2)GMP training: To uphold high product quality and assure compliance of all productionrelated operations with legal requirement, every employee has to undertake set hours of GMP training, according to their different positions. It is mandatory to undertake certain hours of GMP (good manufacturing practice) every year.

• (3) Industrial safety/hygiene training: To provide employees a safe working environment, in addition to enforcement of workplace-safety management, fire-fighting safety management, and employee health management, the company holds education and training on safety and hygiene for employees regularly, so that they can possess necessary safety and hygiene knowledge.

• (4) Training for core and professional skills: To help employees in different job categories enhance their knowledge or operating skills for smooth execution of their duties, analyze necessary core and professional skills for different kinds and levels of jobs before formulating corresponding study roadmaps and training plans. Individual education and training budget is appropriated for every employee, for him/her to attend job-related workshop/training or professional technology seminars, domestic or overseas ones. The technology department also arrange on-the-job training to pass on professional knowledge and experience.

• (5) Person(6al development: Given frequent contact with international pharmaceutical firms in the company's operation, the company has cooperated with English-language training institutions for the provision of English-language courses, Assistance for self-learning: In order to help employees augment their job-related knowledge and skills, formulate encouragement measures subsidizing study by employees themselves, in addition to holding study courses and artistic and literary lectures regularly, to facilitate self-learning by employees.

• (6) New employee training: New employees would take basic instruction on factory safety/hygiene and GMP upon reporting to job, so that they can understand the company and job-related requirements in a short time, in addition to arrangement of introductory training courses, to help them fit in with the working environment.

ScinoPharm Taiwan conducted training sessions for 17,149 person/times totaling 52,035 hours in time, with training items and results listed below:

Items	Person/times	Total hours
Business and management	801	1,112
GMP training	6,901	31,778
Training on industrial safety, hygiene, and environmental protection	1,600	2,372
Training on professional skills	5,357	11,454
Personal development series	2,490	5,319

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1. Retirement system and status of execution

Based on the Labor Standards Act and the Labor Pension Act, the company has formulated measures on employee retirement, stipulating retirement conditions and the criteria for the calculation for retirement payment. Accordingly, the company has made monthly appropriation for retirement reserve fund and set up supervisory committee for the fund, to assure payment for retired employees.

The company appropriates 2% of monthly pay expense for retirement reserve fund, deposited at a dedicated account with the Central Trust of China. Following implementation of the Labor Pension Act on July 1, 2005, the company has been making monthly appropriations equivalent to 6% of employees' salaries for deposit into their personal pension accounts, as well as extra appropriations made by employees themselves.

For employees suited to application of the Labor Standards Act or who keep the front part of service years for application of the Labor Pension Act, their pension is calculated according to article 84-2 and article 55 of the Labor Standards Act. For employees suited to the application of the Labor Pension Act, the company has made proportionate appropriations for deposit into their personal pension accounts. According to the company's retirement measures, employees meeting one of the following conditions can apply for retirement:

(1) 55 years of age or older with over 15 years of service at the company;

(2) More than 25 years of service at the company;

• (3) 60 years of age.

The company can ask employees to retirement, upon 65 years of age or incapability to fulfill their responsibilities, due to mental or physical disability. In the latter case, they will be entitled to 20% markup for pension, if their disability is job-related.

1. Labor-management consultation and upholding of employee benefits

In reflection of the company's high regard for harmony and mutual communications between management and labor, in addition to regular meeting at various units and levels, the company holds a meeting attended by all the employees every year, to acquaint employees with the company's latest business development and enable them to propose suggestions, thereby boosting their identification with the company. Moreover, the company has asked human-resources management unit to organize labor-management meeting, for communication and discussion on various major issues related to labor-management relationship, on top of multiple platforms for internal communications, including corporate website, regular e-bulletin, employee opinion box, cross-level dining, and dedicated employee- complaint mailbox. Employees can freely propose suggestions on various measures and management system via various channels, as major reference for related units in business promotion. Chiefs at various levels also respond to employee opinions regularly, to uphold a harmonious labor-management relationship and consolidate employee identification with the company.

The company didn't suffer loss from labor-management dispute in 2020 and as of the date of the publication of the annual report.

5.6.2 Estimated Losses from Labor Relation Conflicts during the Past Two years and the Future and our planned reaction:

The companies has faithfully complied with and implemented related laws/ regulations of the government, dedicated to set up complete systems and safeguard employees' right and interests, and regarded highly two-way communication with employees, leading to harmonious management-labor relationship, as a result of which there has been no loss caused by labor-management disputes up to now.

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5.7 Important Contracts

ScinoPharm Taiwan, Ltd.

Contract Type	Counterparty	Contract Period	Major Content	Restriction
Development Agreement	A local organization	2012.11.20~	Development for oncology API	Secrecy Obligation
Supply Agreement	A company in the USA	2010.08.19~7th anniversary after commercial launch	Supply of API for depressive disorder	Secrecy Obligation
Supply Agreement	A company in the USA	2011.01.18 ~2ndanniversary after commercial launch	Supply of API for diseases of central nervous system	Secrecy Obligation
Supply Agreement	A company in China	2012.12.10 ~3rdanniversary after commercial launch	Supply of API for cardiovascular diseases	Secrecy Obligation
Development Agreement	A company in China	2011.02.08 ~2026.02.08	Development for oncology API	Secrecy Obligation
Patent License Agreement	A company in Canada	2011.03.15~ 2025.05.26	License of Patent for Manufacturing Anti-cancer API	Secrecy Obligation
Patent License Agreement	A company in India	2011.11.18~2025.06.30	License of Patent for Manufacturing Anti-cancer API	Secrecy Obligation
Collaboration Agreement	A Company in in the USA	2012.03.27 ~ 7thanniversary after commercial launch	Supply of oncology API	Secrecy Obligation
Lease Agreement	Southern Taiwan Science Park Bureau	2018.03.01~2038.02.28	Land Renting for Building ScinoPharm	1.Contract term is up to 20 years 2. Contract can be renewed after expiration
Collaboration Agreement	Baxter	2017.02.27 ~10thanniversary after commercial launch	Development and Sales of oncology drug	Secrecy Obligation
Development Agreement	A company in China	2014.01.02~2024.01.01	Development of oncology drug	Secrecy Obligation
Non-Exclusive License Agreement	A local research institution and a localuniversity	2013.12.10 ~ expiration of the licensed patents	License of the patents for manufacture of API for Cardiovasculardiseases	Receive Royalties & Secrecy Obligation
Non-Exclusive License Agreement	A company in China	2013.07.20~No expiration	Supply of API for diseases of central nervous system	Receive Royalties & Secrecy Obligation
Supply Agreement	A company in China	2014.06.03~ 5th anniversary after commercial launch	Development and Supply of the API for Peripheral Nervous System	Exclusive Supply Obligation & Secrecy Obligation
Collaboration Agreement	A company in China	2014.11.06 ~ 10thanniversary after commercial launch	Development, Manufacture and sale of the drug for Myocardial Perfusion Imaging.	Secrecy Obligation
Collaboration Agreement	A company in China	2014.09.26 ~ 20thanniversary from commercial launch	Development and sales of Oncology drug	Non-Competition & Secrecy Obligation
Service Agreement	A local company	2014.07.30~2024.07.29	development of new drug for Stem cell	Non-Competition & Secrecy Obligation
Collaboration Agreement	A company in China	2014.05.05 ~8thanniversary from commercial launch	Development and sale of anticoagulant medication	Exclusive supply

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Contract Type	Counterparty	Contract Period	Major Content	Restriction
Development and supply agreement	A company in the USA	2014.03.06 ~10thanniversary after commercial launch	Development and Sales of drug for leukemia	Non-Competition & Secrecy Obligation
Development and Supply Agreement	A company in the USA	2015.01.19~7th anniversary after commercial launch	Development and Supply of oncology drug	Secrecy Obligation
Service Agreement	A company in the USA	2015.04.10~10 years after the effective date, or all works in the project orders effective before the 10th anniversary is completed, whichever is later.	API development	Secrecy Obligation
Development Agreement	A local medical device company	2015.07.29~	Development of certain medical device	Secrecy Obligation
Contract for outsourcing of R&D and production	A U.S. company	2016.07.27 ~ 2021.07.26	Commissioned R&D and production for API	Secrecy Obligation
Contract for outsourcing of R&D and production	A Taiwanese company	2016.04.27 ~	Commissioned R&D and production for API	Secrecy Obligation
Supply Agreement	A Company in USA	2017.06.19~2024.06.18	Supply API of New Anti- biotic drug	Secrecy Obligation
Supply Agreement	A Company in USA	2017.05.31~2020.05.30	Supply API of New Anti- biotic drug	Secrecy Obligation
Supply Agreement	A Company in Dubai	2017.05.03~ 2027.05.02	Supply of Anti-cancer API	Secrecy Obligation
Supply Agreement	A company in China	2018.12.10~	Sales of API	Secrecy Obligation
Supply Agreement	A company in Japan	2018.04.12~	Supply of API	Secrecy Obligation
Supply Agreement	A company in Germany	2019.01.01~	Sales of multiple APIs	Secrecy Obligation
Supply Agreement	A Company in USA	2020/05/21 ~ 2027/05/20	Sales of API	Secrecy Obligation Exclusive supply
Agreement on increased or supplementary supply in supply contract	A Company in USA	2020/05/21 ~ expiration day of the licensed patents	patent licensing	Secrecy Obligation
Contract for outsourcing of R&D and production	A Company in USA	2020/09/09 ~ 2025/09/08	Commissioned R&D and production for API	Secrecy Obligation
Supply Agreement	A company in China	2020/08/21 ~ 2025/08/20	Sales of API	Secrecy Obligation
Contract for outsourcing of R&D and production	A company in France	2020/09/28 ~ 2027/09/27	Contract for outsourcing of R&D and production	Secrecy Obligation
Contract for outsourcing of R&D and production	A company in Canada	2020/02/13 ~ 2025/02/12	Contract for outsourcing of R&D and production	Secrecy Obligation
Supply Agreement	Singaporean subsidiary of a certain French pharmaceutical company	2020/05/25 ~ 2025/05/24	Contract for outsourcing production	Secrecy Obligation

~125~

Contract Type	Counterparty	Contract Period	Major Content	Restriction
Supply Agreement	A company in Germany	2019/01/01 ~ 2021/12/31	Sales of multiple APIs	Secrecy Obligation
Supply Agreement	A company in India	2020/10/12 ~ 2023/10/11	Sales of multiple APIs	Secrecy Obligation

SciAnda (Changshu) Pharmaceuticals, Ltd.

Contract Type	Counterparty	Contract Period	Major Content	Restriction
		2013.01.31	Development,
Collaboration	Two companies in
		~20thanniversary after	manufacture and sales of	Secrecy Obligation
Agreement	China
		commercial launch	oncology drug
		2013.08.06 till both
Research			Contract research service
	A company in China	parties’ obligations are		Secrecy Obligation
agreement			for oncology drug
		completed
		2014.02.24 till both
Research			Contract manufacturing
	A company in China	parties’ obligations are		Secrecy Obligation
agreement			for API
		completed
		2014.10.28
Supply			Supply and sale of	Non-Competition &
	A company in China	~5thanniversary after
Agreement			oncology API	Secrecy Obligation
		commercial launch
Service Agreement	A company in the USA	2015.07.15~2017.07.14 and will be automatically renewedforone year	Contract research service	Secrecy Obligation
Development Agreement	A company in China	2017.06.13 ~	Contract manufacturing for API	Secrecy Obligation
Development Agreement	A company in China	2017.06.19 ~	Contract manufacturing for oncology drug	Secrecy Obligation
Development & Manufacture Agreement	A company in China	2017.04.25 ~2022.04.24	Contract development & manufacturing for oncology drug	Secrecy Obligation
Development Agreement	A company in China	2017.01.03 ~	Contract development for cardiovascular diseases	Secrecy Obligation
Manufacture Agreement	A company in China	2017.01.03 ~	Contract manufacturing of drug for eye disease	Secrecy Obligation
Service Agreement	A company in China	2017.11.23~	Stability Test for Urea cycle disorders drug	Secrecy Obligation
Development Contract	A Taiwanese company	2017.10.31~	Manufacture, validation, stability test and new drug clinical trial application for hypertension API	Secrecy Obligation
Supply Agreement	A company in China	2018.04.13~2028.04.13	manufacturing for API	According to the stipulation of the contract
Service Agreement	A company in Ireland	2019.03.22~2024.03.21	Commissioned Customized development &manufacturing	Secrecy Obligation
Service Agreement	A company in the USA	2019.06.03~2024.06.02 Extend one more year afterward automatically	APIs Contract Development & Manufacturing	Secrecy Obligation
Service Agreement	A company in Europe	2019.04.12~2024.04.11 Extend one more year afterward automatically	Customized drugs Contract development & manufacturing	Secrecy Obligation
Service Agreement	A company in the USA	2019/12/03~ 2021/12/02	Anti-depression drugs Contract Development & Manufacturing	Secrecy Obligation

~126~

VI. Financial Information

6.1 Five-Year Financial Summary

6.1.1 Financial Information-IFRS

Consolidated Condensed Balance Sheet - Based on IFRS

		Unit: NT$thousands	Unit: NT$thousands	Unit: NT$thousands	Unit: NT$thousands	Unit: NT$thousands	Unit: NT$thousands
Year Item		Financial Summary for The Last Five Years					Financial Summary As of 2021.03.31
		2016	2017	2018	2019	2020
Current assets		6,585,375	6,467,127	6,506,167	5,406,584	5,916,137	6,106,784
Property, Plant and Equipment		5,208,898	5,088,713	4,758,846	4,433,860	4,210,746	4,163,916
Intangible assets		24,078	23,334	16,753	14,068	8,900	9,231
Other assets		964,649	1,122,215	1,281,562	1,820,052	1,710,980	1,898,248
Total assets		12,783,000	12,701,389	12,563,328	11,674,564	11,846763	12,178,179
Current liabilities	Before distribution	1,691,693	1,115,458	1,945,644	741,747	686,646	739,034
	After distribution	1,919,791	1,495,013	2,333,106	955,247	(Note 1)	(Note 1)
Non-current liabilities		863,514	1,168,706	1,820,052	672,873	630,714	627,720
Total liabilities	Before distribution	2,555,207	2,284,164	2,024,296	1,414,620	1,317,360	1,366,754
	After distribution	2,783,305	2,663,719	2,411,758	1,628,120	(Note 1)	(Note 1)
Equity attributable to shareholders of the parent		10,227,793	10,417,225	10,539,032	10,259,944	10,529,403	10,811,425
Capital stock		7,603,262	7,907,392	7,907,392	7,907,392	7,907,392	7,907,392
Capital surplus		1,275,660	1,286,872	1,292,555	1,294,605	1,294,689	1,294,689
Retained earnings	Before distribution	1,352,325	1,242,726	1,299,469	1,125,773	1,360,365	1,464,681
	After distribution	820,097	863,171	912,007	912,273	(Note 1)	(Note 1)
Other equity		(3,454)	(19,765)	39,616	(67,826)	(33,043	144,663
Treasury stock		-	-	-	-	-	-
Non-controlling interest		-	-	-	-	-	-
Total equity	Before distribution	10,227,793	10,417,225	10,539,032	10,259,944	10,529,403	10,811,425
	After distribution	9,999,695	10,037,670	10,151,570	10,046,444	(Note 1)	(Note 1)

Note 1: Proposal for allocation of the company's earnings in 2020 has yet to be approved by Shareholders' Meeting

~127~

Parent Condensed Balance Sheet - Based on IFRS

Unit: NT$ thousands

Year Item	Year Item	Financial Summary for The Last Five Year	Financial Summary for The Last Five Year	Financial Summary for The Last Five Year	Financial Summary for The Last Five Year	Financial Summary for The Last Five Year	Financial Summary As of 2021.03.31 （Note 2）
		2016	2017	2018	2019	2020
Current assets		5,718,294	5,858,009	5,971,748	4,819,167	5,523,776	-
Property, Plant and Equipment		3,722,375	3,609,589	3,387,960	3,192,172	3,053,564	-
Intangible assets		12,633	10,752	8,402	9,458	6,885	-
Other assets		1,508,972	1,506,463	1,806,712	3,400,541	3,192,696	-
Total assets		10,962,274	10,984,813	11,174,822	11,421,338	11,776,921	-
Current liabilities	Before distribution	641,933	496,656	557,228	488,608	616,804	-
	After distribution	870,031	876,211	944,690	702,108	(Note 1)	-
Non-current	liabilities	92,548	70,932	78,562	672,786	630,714	-
Total liabilities	Before distribution	734,481	567,588	635,790	1,161,394	1,247,518	-
	After distribution	962,579	947,143	1,023,352	1,374,894	(Note 1)	-
Equity attributable to shareholders of the parent		-	-	-	-	-	-
Capital stock		7,603,262	7,907,392	7,907,392	7,907,392	7,907,392	-
Capital surplus		1,275,660	1,286,872	1,292,555	1,294,605	1,294,689	-
Retained earning	Before distribution	1,352,325	1,242,726	1,299,469	1,125,773	1,360,365	-
	After distribution	820,097	863,171	912,007	912,273	(Note1)	-
Other equity		(3,454)	(19,765)	39,616	(67,826)	(33,043)	-
Treasury stock		-	-	-	-	-	-
Non-controlling interest		-	-	-	-	-	-
Total equity	Before distribution	10,227,793	10,417,225	10,539,032	10,259,944	10,529,403	-
	After distribution	9,999,695	10,037,670	10,151,570	10,046,444	(Note 1)	-

Note 1: Proposal for allocation of the company's earnings in 2020 has yet to be approved by shareholders' meeting.

Note 2: According to "Regulations Governing the Preparation of Financial Reports by Securities Issuers", the parent company only financial reports should be prepared at end of year.

~128~

Consolidated Condensed Statement of Comprehensive Income

Unit: NT$ thousands

Year Item	Financial Summary for The Last Five Years	Financial Summary for The Last Five Years	Financial Summary for The Last Five Years	Financial Summary for The Last Five Years	Financial Summary for The Last Five Years	Financial Summary As of 2021.03.31
	2016	2017	2018	2019	2020
Operating revenue	4,030,921	3,516,481	3,524,263	2,892,783	3,082,928	641,136
Gross profit	1,805,961	1,550,157	1,542,514	1,176,405	1,317,459	364,768
Income from operations	868,276	558,962	558,412	266,854	375,723	110,353
Non-operating income/ expense	(57,676)	(83,660)	(67,871)	(1,800)	(17,218)	2,450
Net income before tax	810,600	475,302	490,541	265,054	358,505	112,803
Net income from continuing operation	658,693	422,367	442,978	216,656	282,067	90,238
Loss from discontinued operations	-	-	-	-	-	-
Net income (Loss)	658,693	422,367	442,978	216,656	282,067	90,238
Other comprehensive Income(after tax)	(78,684)	(16,049)	(95,774)	(110,332)	200,808	191,784
Total comprehensive Income(Losses)	580,009	406,318	347,204	106,324	482,875	282,022
Net income attributable to theparent	658,693	422,367	442,978	216,656	282,067	90,238
Net income attributable to non-controllinginterest	-	-	-	-	-	-
Comprehensive income attributable to theparent	580,009	406,318	347,204	106,324	482,875	282,022
Comprehensive income attributable to non- controllinginterest	-	-	-	-	-	-
Earnings per share (NT$)	0.87	0.53	0.56	0.27	0.36	0.11

~129~

Parent Condensed Statement of Income –Based on IFRS

Unit: NT$ thousands

Year Item	Financial Summary for The Last Five Years (Note 1)	Financial Summary for The Last Five Years (Note 1)	Financial Summary for The Last Five Years (Note 1)	Financial Summary for The Last Five Years (Note 1)	Financial Summary for The Last Five Years (Note 1)	Financial Summary As of 2021.03.31
	2016	2017	2018	2019	2020
Operation revenue	3,888,611	3,449,175	3,470,109	2,813,047	3,046,220	-
Gross profit	1,848,076	1,671,193	1,661,639	1,135,660	1,287,748	-
Income from operations	1,066,196	801,318	765,170	322,297	450,854	-
Non-operating income/ expense	(244,390)	(312,542)	(297,519)	(75,783)	(97,972)	-
Net income before tax	821,806	488,776	467,651	246,514	352,882	-
Net income from continuing operation	658,693	422,367	442,978	216,656	282,067	-
Loss from discontinued operations	-	-	-	-	-	-
Net income (Loss)	658,693	422,367	442,978	216,656	282,067	-
Other comprehensive Income(after tax)	(78,684)	(16,049)	(95,774)	(110,332)	(200,808)	-
Total comprehensive Income(Losses)	580,009	406,318	347,204	106,324	482,875	-
Net income attributable to theparent	-	-	-	-	-	-
Net income attributable to non-controllinginterest	-	-	-	-	-	-
Comprehensive income attributable to theparent	-	-	-	-	-	-
Comprehensive income attributable to non-controllinginterest	-	-	-	-	-	-
Earnings per share (NT$)	0.87	0.53	0.56	0.27	0.36	-

Note1: According to "Regulations Governing the Preparation of Financial Reports by Securities Issuers", the parent company only financial reports should be prepared at end of year.

6.1.2 Auditors’ Opinions from 2016 to 2020

Year	Auditing Firm	CPA	Audit Opinions
2016	PricewaterhouseCoopers, Taiwan	Yung-Chih Lin Ming-Hsien Lee	Unqualified
2017	PricewaterhouseCoopers, Taiwan	Yung-Chih Lin Tzu-Meng Liu	Unqualified
2018	PricewaterhouseCoopers, Taiwan	Yung-Chih Lin Tzu-Meng Liu	Unqualified
2019	PricewaterhouseCoopers, Taiwan	Yung-Chih Lin Tzu-Meng Liu	Unqualified
2020	PricewaterhouseCoopers, Taiwan	Yung-Chih Lin Tzu-Meng Liu	Unqualified

~130~

6.2 Five-Year Financial Analysis

Consolidated Financial Analysis – Based on IFRS

Item(Note 4)	Year	Financial Analysis for the Last Five Years	Financial Analysis for the Last Five Years	Financial Analysis for the Last Five Years	Financial Analysis for the Last Five Years	Financial Analysis for the Last Five Years	Financial Analysis As of 2021.03.31 (Note1)
		2016	2017	2018	2019	2020
Financial structure	Debt to Assets Ratio (%)	19.99	17.98	16.11	12.12	11.12	11.22
	Ratio of long-term capital to property, plant and equipment(%)	212.93	227.68	223.11	246.58	265.04	274.72
Solvency	Current ratio (%)	389.28	579.77	334.40	728.90	861.60	826.32
	Quick ratio (%)	268.57	419.18	259.31	559.57	664.42	618.33
	Interest earned ratio(times)	23.44	7.20	7.12	5.76	24.64	68.79
Operating performance	Accounts receivable turnover (times)	5.10	5.32	5.92	5.03	6.31	7.25
	Average collection days	72	69	62	73	58	50
	Inventory turnover (times)	0.90	0.83	0.93	0.93	1.06	0.62
	Accounts payable turnover(times)	26.94	23.39	20.92	16.86	13.08	6.55
	Average inventory turnover days	406	440	392	392	344	589
	Property, plant and equipment turnover (times)	0.74	0.62	0.68	0.59	0.68	0.58
	Total assets turnover(times)	0.31	0.25	0.26	0.23	0.25	0.20
Profitability	Return on total assets(%)	5.51	3.81	4.01	2.16	2.50	3.05
	Return on stockholders' equity (%)	6.56	4.09	4.23	2.08	2.71	3.38
	Pre-tax income to paid-in capital(%)	10.66	6.01	6.20	3.35	4.53	5.71
	Net margin (%)	16.34	12.01	12.57	7.49	9.15	14.07
	Earnings per share (NT$) (Note2)	0.87	0.53	0.56	0.27	0.36	0.11
Cash flow	Cash flow ratio (%)	98.42	87.11	63.30	106.36	137.82	52.51
	Cash flow adequacyratio(%)	68.31	81.12	128.36	179.47	199.18	184.18
	Cash reinvestment ratio(%)	9.21	4.49	5.33	2.42	4.28	2.22
	Operating leverage	1.54	1.81	1.80	2.55	2.05	1.88
Leverage	Financial leverage	1.04	1.16	1.17	1.26	1.04	1.02

~131~

Analysis of financial ratio differences for the last two years.

1. Times interest earned ratio increased in 2020, due to reduced interest expense.

2. Accounts receivable turnover (times) increased and average collection days dropped in 2020, due to increased net sales.

3. Accounts payable turnover (times) dropped in 2020, due to increased accounts payable.

4. Return on stockholders' equity, Net margin, and earnings per share all increased in 2020, thanks to increased Net Income.

5. Pre-tax income to paid-in capital (%) increased in 2020, due mainly to less increase in Pre-tax income.

6. Cash flow ratio increased in 2020, thanks to increased Net cash flow for business activities.

7. Cash reinvestment ratio increased in 2020, thanks to increased Net cash flow for business activities.

8. Degree of operating leverage dropped in 2020, thanks to increased Income from Operations.

9. Note1: Financial Information prepared as of 2021.03.31 follows IFRS and has been verified by independent auditors.

Note2: Calculated based on weighted average number of outstanding shares during each year.

• Note3: The calculation formula of financial analysis:

• Capital Structure Analysis

• (1) Debt ratio = Total Liabilities / Total Assets

• (2) Long-term fund to PP&E ratio= (Shareholders' Equity + non-current Liabilities) / Net PP&E

• Liquidity Analysis

• (1) Current ratio = Current Assets / Current Liabilities

• (2) Quick ratio = (Current Assets - Inventories - Prepaid Expenses) / Current Liabilities

• (3) Times interest earned = Earnings before Interest and Taxes / Interest Expenses

• Operating Performance Analysis

• (1) Average collection turnover = Net Sales / Average Trade Receivables

• (2) Average collection days = 365 / Receivables Turnover rate

• (3) Average inventory turnover = Cost of Sales / Average inventory

• (4) Average inventory turnover days = 365 / Inventory Turnover rate

• (5) Average payment turnover = Cost of Sales / Average Trade Payables

• (6) Fixed assets turnover = Net Sales / Average Net Properties

• (7) Total assets turnover = Net Sales / Average Total Assets

• Profitability Analysis

• (1) Return on total assets = {Net Income + Interest Expenses * (1 - Effective tax rate)} / Average Total Assets

• (2) Return ratio on stockholders' equity = Net Income / Average Shareholders' Equity

• (3) Pre-tax income to paid-in capital = income before tax / Capital

• (4) Net margin = Net income / Net Sales

• (5) Earnings per share = (Net income – Preferred Stock Dividend) / Weighted Average Number of Shares outstanding

• Cash Flow

• (1) Cash flow ratio = Net Cash Provided by Operating Activities / Current Liabilities

• (2) Cash Flow Adequacy Ratio =Five-year sum of cash from operations / Five-year sum of capital expenditures’ inventory additions’ and cash dividends.

• Cash flow reinvestment ratio = (Cash Provided by Operating Activities - Cash Dividends) / (Gross PP&E + Investment + Other non-current Assets + Working Capital)

• Leverage

• (1) Operating leverage = (Net Sales - Variable Cost) / Income from Operations

• (2) Financial leverage = Income from Operations / (Income from Operations - Interest Expenses)

• Note 4: Cash-flow analysis

• Net cash flow for business activities refers to the amount of business activities-related cash flow in the cash-flow table

• Capital outlay refers to the amount of cash outflow for capital investment

• Increased amount of inventory is taken into account only when final inventory is larger than initial inventory. The entry will be zero, should inventory at the end of year decrease.

• Cash dividend includes cash dividend for both common shares and preferred shares

• Gross value of PP&E refers to their gross value before accumulated depreciation.

~132~

Parent Financial Analysis – Based on IFRS

Year Item(Note 4)	Year Item(Note 4)	Financial Analysis for the Last Five Years	Financial Analysis for the Last Five Years	Financial Analysis for the Last Five Years	Financial Analysis for the Last Five Years	Financial Analysis for the Last Five Years	Financial Analysis As of 2021.03.31 (Note1)
		2016	2017	2018	2019	2020
Financial structure	Debt to Assets Ratio (%)	6.70	5.17	5.69	10.17	10.59	NA
	Ratio of long-term capital to property, plant and equipment(%)	277.25	290.56	313.39	342.49	365.48
Solvency	Current ratio (%)	890.79	1,179.49	1,071.69	986.31	895.55
	Quick ratio (%)	602.53	857.33	834.11	739.03	695.84
	Interest earned ratio (times)	74,710.63	22,218.09	105.95	29.89	50.90
Operating performance	Accounts receivable turnover(times)	5.31	5.54	5.95	5.05	6.46
	Average collection days	69	66	61	72	57
	Inventory turnover (times)	0.92	0.87	0.99	1.05	1.17
	Accounts payable turnover(times)	32.23	15.74	14.56	12.83	11.29
	Average inventory turnover days	397	420	369	348	312
	Property, plant and equipment turnover (times)	1.02	0.87	0.95	0.82	0.94
	Total assets turnover (times)	0.35	0.29	0.30	0.24	0.25
Profitability	Return on total assets (%)	6.16	3.85	4.03	1.98	2.48
	Return on stockholders' equity (%)	6.56	4.09	4.23	2.08	2.71
	Pre-tax income to paid-in capital (%)	10.81	6.18	5.91	3.12	4.46
	Net margin (%)	16.94	12.25	12.77	7.70	9.26
	Earnings per share (NT$) (Note2)	0.87	0.53	0.56	0.27	0.36
Cash flow	Cash flow ratio (%)	291.35	235.13	222.74	141.14	152.75
	Cash flow adequacy ratio(%)	89.91	108.01	146.30	136.27	138.54
	Cash reinvestment ratio(%)	11.27	6.24	5.57	1.89	4.44
Leverage	Operating leverage	1.36	1.44	1.42	1.93	1.64
	Financial leverage	1.00	1.00	1.01	1.03	1.02

~133~

Analysis of financial ratio differences for the last two years.

1. Times interest earned ratio increased in 2020, due to increased Pre-tax income.

2. Accounts receivable turnover (times) increased and average collection days dropped in 2020, due to increased net sales.

3. Return on total assets, Return on stockholders' equity, Net margin, and earnings per share all increased in 2020, thanks to increased Net Income.

4. Pre-tax income to paid-in capital increased in 2020, thanks to increased Pre-tax income.

5. 5.Cash reinvestment ratio increased in 2020, thanks to increased Net cash flow for business activities.

6. Note 1: Individual financial statement is only complied at the end of year, according to the guidelines for compilation of financial statement issuers of securities.

7. Note 2: Calculated based on weighted average number of outstanding shares during each year.

8. Note3: The calculation formula of financial analysis:

9. Capital Structure Analysis

10. (1) Debt ratio = Total Liabilities / Total Assets

11. (2) Long-term fund to PP&E ratio= (Shareholders' Equity + non-current Liabilities) / Net PP&E

12. Liquidity Analysis

13. (1) Current ratio = Current Assets / Current Liabilities

14. (2) Quick ratio = (Current Assets - Inventories - Prepaid Expenses) / Current Liabilities

15. (3) Times interest earned = Earnings before Interest and Taxes / Interest Expenses

16. Operating Performance Analysis

17. (1) Average collection turnover = Net Sales / Average Trade Receivables

18. (2) Average collection days = 365 / Receivables Turnover rate

19. (3) Average inventory turnover = Cost of Sales / Average inventory

20. (4) Average inventory turnover days = 365 / Inventory Turnover rate

21. (5) Average payment turnover = Cost of Sales / Average Trade Payables

22. (6) Fixed assets turnover = Net Sales / Average Net Properties

23. (7) Total assets turnover = Net Sales / Average Total Assets

24. Profitability Analysis

25. (1) Return on total assets = {Net Income + Interest Expenses * (1 - Effective tax rate)} / Average Total Assets

26. (2) Return ratio on stockholders' equity = Net Income / Average Shareholders' Equity

27. (3) Pre-tax income to paid-in capital = income before tax / Capital

28. (4) Net margin = Net income / Net Sales

29. (5) Earnings per share = (Net income – Preferred Stock Dividend) / Weighted Average Number of Shares outstanding

30. Cash Flow

31. (1) Cash flow ratio = Net Cash Provided by Operating Activities / Current Liabilities

32. (2) Cash Flow Adequacy Ratio =Five-year sum of cash from operations / Five-year sum of capital expenditures’ inventory additions’ and cash dividends.

    • Cash flow reinvestment ratio = (Cash Provided by Operating Activities - Cash Dividends) / (Gross PP&E + Investment + Other non-current Assets + Working Capital)

33. Leverage

34. (1) Operating leverage = (Net Sales - Variable Cost) / Income from Operations

35. (2) Financial leverage = Income from Operations / (Income from Operations - Interest Expenses)

36. Note 4: Cash-flow analysis

37. Net cash flow for operating activities refers to the amount of operating activities-related cash flow in the cash-flow table

38. Capital outlay refers to the amount of cash outflow for capital investment

39. Increased amount of inventory is taken into account only when final inventory is larger than initial inventory. The entry will be zero, should inventory at the end of year decrease.

40. Cash dividend includes cash dividend for both common shares and preferred shares

41. Gross value of PP&E refers to their gross value before accumulated depreciation.

~134~

6.3Audit Committee’s Report in the Most Recent Year

Audit Committee's Review Report (Translated from Chinese)

I hereby state as following:

This proposal is the presentation by the Board of Directors of the Company's 2020 Business Report, Financial Statements, and the Profit Allocation Proposal. Of these items, the Financial Statements have been audited by PricewaterhouseCoopers Taiwan, and an opinion and report have been issued on the Financial Statements. The aforementioned proposal regarding Business Report, Financial Statements, and the Profit Allocation Proposal have been reviewed and determined to be correct and accurate by the Audit Committee. Per the regulations in Article 14-4 of Securities and Exchange Act and Article 219 of the Company Act, we hereby submit this report.

ScinoPharm Taiwan, Ltd. Chairman of the Audit Committee: Wei-Te Ho March 18, 2021

6.4 The Audited Consolidated Financial Report for the most Recent Fiscal Year

Please refer to appendix A

6.5 The Audited Parent Company only Financial Report for the most Recent Fiscal Year

Please refer to appendix B

6.6 Financial Difficulties

The Company should disclose the financial impact to the Company if the Company and its affiliated companies have incurred any financial or cash flow difficulties as of the date of this Annual Report: None

~135~

VII Review of Financial Conditions, Operating Results, and Risk Management

7.1 Analysis of Financial Status

Consolidated Financial statement Unit: NT$ thousands

Year Item	2020	2019	Difference	Difference
			Amount	%
Current Assets	5,916,137	5,406,584	509,553	9.42
Property, Plant and Equipment	4,210,746	4,433,860	(223,114)	(5.03)
Intangible Assets	8,900	14,068	(5,168)	(36.74)
Other Assets	1,710,980	1,820,052	(109,072)	(5.99)
Total Assets	11,846,763	11,674,564	172,199	1.47
Current Liabilities	686,646	741,747	(55,101)	(7.43)
Other Liabilities	630,714	672,873	(42,159)	(6.27)
Total Liabilities	1,317,360	1,414,620	(97,260)	(6.88)
Total Stockholders' Equity	10,529,403	10,259,944	269,459	2.63

Parent Company Only Financial statement Unit: NT$ thousands

Parent CompanyOnlyFinancial	statement		Unit: NT$thousands	Unit: NT$thousands
Year Item	2020	2019	Difference
			Amount	%
Current Assets	5,523,776	4,819,167	704,609	14.62
Property, Plant and Equipment	3,053,564	3,192,172	(138,608)	(4.34)
Intangible Assets	6,885	9,458	(2,573)	(2.72)
Other Assets	3,192,696	3,400,541	(207,845)	(6.11)
Total Assets	11,776,921	11,421,338	355,583	3.11
Current Liabilities	616,804	488,608	128,196	26.24
Non-current Liabilities	630,714	672,786	(42,072)	(6.25)
Total Liabilities	1,247,518	1,161,394	86,124	7.42
Total Stockholders' Equity	10,529,403	10,259,944	269,459	2.63

7.1.1 Explanation for variance (if the variation is 20 % or more):

Consolidated Financial Statements:

1. Intangible Assets decreased due mainly to completion of amortization consecutively.

2. Parent Company Only Financial statement:

3. Current Liabilities decreased due mainly to the payback of bank loans for the operation of SciAnda (Changshu) Pharmaceuticals, Ltd.

7.1.2 Effect of said changes on the Company: The aforementioned changes did not affect the Company significantly.

7.1.3 Future response plans: Not applicable.

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7.2 Analysis of Operation Results

Consolidated Financial statement Unit: NT$ thousands

Item	2020	2020	2019	Difference	(%)
Net Operating Revenue	3,082,928		2,892,783	190,145	6.57
Operating Costs	(1,765,469)		(1,716,378)	(49,091)	2.86
Net Operating Margin	1,317,459		1,176,405	141,054	11.99
Operating Expenses	(941,736)		(909,551)	(32,185)	3.54
Operating Profit	375,723		266,854	108,869	40.80
Non-operating Income And Expenses	(17,218)		(1,800)	(15,418)	856.52
Profit Before Income Tax	358,505		265,054	93,451	35.26
Income Tax Expense	(76,438)		(48,398)	(28,040)	57.94
Profit For the Year	282,067		216,656	65,411	30.19
Total Other Comprehensive Income (Loss) For The Year (After Tax)	200,808		(110,332)	311,140	282.00
Total Comprehensive Income For The Year	482,875		106,324	376,551	354.15
Parent CompanyOnlyFinancial statementUnit: NT$thousands
Item	2020	2019		Difference	(%)
Net Operating Revenue	3,046,220	2,813,047		233,173	8.29
Operating Costs	(1,758,472)	(1,677,387)		(81,085)	4.83
Net Operating Margin	1,287,748	1,135,660		152,088	13.39
Operating Expenses	(836,894)	(813,363)		(23,531)	2.89
Operating Profit	450,854	322,297		128,557	39.89
Non-operating Income And Expenses	(97,972)	(75,783)		(22,189)	29.28
Profit Before Income Tax	352,882	246,514		106,368	43.15
Income Tax Expense	(70,815)	(29,858)		(40,957)	137.17
Profit For the Year	282,067	216,656		65,411	30.19
Total Other Comprehensive Income (Loss) For The Year (After Tax)	200,808	(110,332)		311,140	282.00
Total Comprehensive Income For The Year	482,875	106,324		376,551	354.15

Parent Company Only Financial statement Unit: NT$ thousands

7.2.1 Explanation for variance (if the variation is 20 % or more):

Consolidated financial statement

1. Operating Profit, Profit Before Income Tax and Profit For The Year increased, due mainly to increased Net operating revenue.

2. Income Tax Expense increased, due mainly to increased Income tax rate rose up to 20%.

3. Total Other Comprehensive Income (Loss) For the Year (After Tax) increased, due mainly to valuation profit by financial instruments.

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Parent financial statements:

1. Operating Profit, Profit Before Income Tax, and Profit for The Year increased, due mainly to increase of Net Operating Revenue.

2. Non-operating Income and Expenses increase, due mainly to the decrease of indemnity income and increase of exchange loss.

3. Income Tax Expense increased, due mainly to increased Income tax rate rose up to 20%.

4. Total Other Comprehensive Income (Loss) For the Year (After Tax) increased, due mainly to valuation profit by financial instruments.

7.2.2 Sales forecast and basis

A. Forecast of sales amount

s forecast and basis cast of sales amount
Item	Amount(kg)
Generic API	28,382
CMO API	2,457
CRO API	547
Total	31,386

B. Basis of sales forecast:

• The forecast of sales amounts in the above table is based on the needs of customers for the company's products, the company's capacity, and status of new-product development, and the schedule for the introduction of new products.

• C. Possible effect of future finance and business and contingency plan: In view of the company's sound finance and stable business outlook, there is no major uncertainty for future finance and business.

7.2.3 Effect of said changes on the Company: The aforementioned changes did not affect the Company significantly.

7.2.4 Future response plans: Not applicable.

7.3 Analysis of Cash Flow

7.3.1 Cash Flow Analysis for the Current Year

Unit: NT$ thousands

				Unit: NT$ thousands	Unit: NT$ thousands
Cash and Cash Equivalents, Beginning of Year(1)	Net Cash Flow from Operating Activities (2)	Cash Outflow (3)	Cash Surplus (Deficit) (1)+(2)-(3)	Countermeasure for insufficient cash
				Investment Plans	Financing Plans
3,304,978	946,312	(196,342)	4,054,948	-	-

• (1) Operating activities: Operating activities generated NT$946,312 thousand dollars net cash inflow in 2020, attesting to the company's good business status.

• (2) Investment activities: Investment-related net cash inflow reached NT$241,720 thousand dollars, mainly due to proceeds from the disposal of financial assets (stocks listed the overthe-counter market) estimated according to its fair value under the category of other comprehensive income and equipment updating and maintenance and for new equipment purchasing.

• (3) Financing activities: Financing activities caused NT$444,908 thousand dollars of net cash outflow, mainly due to cash-dividend payout and payback of bank loan.

• (4) Effect of change in exchange rate to cash and cash equivalent cash inflow was 6,846 thousand dollars.

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7.3.2 Remedy for Cash Deficit and Liquidity Analysis

Countermeasure for insufficient cash: There was no shortage of cash in the year.

7.3.3 Cash Flow Analysis for the Coming Year

Unit: NT$ thousands

				Unit: NT$ thousands	Unit: NT$ thousands
Estimated Cash and Cash Equivalents, Beginning of Year(1)	Estimated Net Cash Flow from Operating Activities (2)	Estimated Cash Outflow (Inflow) (3)	Cash Surplus (Deficit) (1)+(2)-(3)	Countermeasure for insufficient cash
				Investment Plans	Financing Plans
4,054,948	380,189	(688,672)	3,746,465	-	-

• 7.3.3.1 Analysis of change in cash flow in the coming one year:

• (a) Operating activities: Derive mainly from the company's operating net profit. Given registered batch production of injection-medicine plant and higher development cost for preparations, higher tax payment on higher profits last year, plus no time for prior collection for account receivable, it is forecast that operating net cash inflow will reach NT$380,189 thousand dollars for the coming year.

• (b) Investment activities: Investment-related net cash inflow reached NT$241,720 thousand dollars, mainly due to proceeds from the disposal of financial assets (stocks listed the over-the-counter market) estimated according to its fair value under the category of other comprehensive income and equipment updating and maintenance and for new equipment purchasing.

• (c) Financing activities: Financing activities are expected to cause NT$421,463 thousand dollars cash outflow, due mainly to the increased payout of cash dividend for year 2020.

• 7.3.3.2 Countermeasures for insufficient cash and liquidity analysis: Not applicable, since the situation is nonexistent.

7.4 Major Capital Expenditure Items

7.4.1 Major Capital Expenditure Items and Source of Capital: None

7.5 Investment Policy in Last Year, Main Causes for Profits or Losses, Improvement Plans and the Investment Plans for the Coming Year

7.5.1. Equity investment policy

• (1) SciAnda (Kunshan) Biochemical Technology, Ltd.: Acquisition by SciAnda (Changshu) Pharmaceuticals, Ltd. with approval by local competent authority in Aug. 2020

• (2) SciAnda (Changshu) Pharmaceuticals, Ltd.: As of 2020, the Changshu plant had obtained production permit for 19 APIs (active pharmaceutical ingredients) from China's State Food and Drug Administration, plus passage of inspection by some key customers. Focusing on development and production of new APIs, it passed inspection by the U.S. FDA at the end of 2015 and Japan's PMDA in August 2018. It is scheduled to kick off mass production in the second half of 2021, following approval of technology transformation items and machine shop renovation.

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• (3) SciAnda Shanghai Biochemical Technology, Ltd.: The Company aims mainly to tap China's domestic market and service European and U.S. customers in Shanghai, plus agency, sale, and export/import for APIs and intermediates, as well as consulting service for biotech R&D.

7.5.2 Reasons for profit or loss

• (1) SciAnda (Kunshan) Biochemical Technology, Ltd.: Net profit prior to M&A in the year derived mainly from wealth management.

• (2) SciAnda (Changshu) Pharmaceuticals, Ltd.: It suffered loss, due to less-than-expectation sales growth, resulting from increasingly stringent environmental, safety, and hygiene regulations, infrastructural investments necessitated by new GMP edition, rising environmental-protection costs, and increasing business risk, which boost R&D and manufacturing cost.

• (3) SciAnda Shanghai Biochemical Technology, Ltd.: It aims mainly to help SciAnda (Changshu) Pharmaceuticals apply for pharmaceutical registration in China and develop potential customers. It generated net profit in the year, thanks to decreased value for offsetting deferred income tax assets which cannot be materialized.

7.5.3. Improvement plan

Having cleared plant inspection by the U.S. FDA and Japan PMDA, SciAnda (Changshu) is seeking early plant inspection by China National Medical Products Administration for the products in collaboration with customers and accelerated operation of the Changshu plant via cost control and focus on products which can generate revenue and boost capacity utilization rate in short term. Seeking more business opportunities in CDMO, and strive to accelerate the pace of operation of ScinoPharm (Changshu).

7.5.4. Future investment plans

SciAnda (Changshu) Pharmaceuticals, Ltd.: Following completion of its merger with SciAnda (Kunshan) Biotech Co., Ltd. on August 2020 approved by local competent authority. The merger will increase the operating cash flow and improve the financial structure of SciAnda (Changshu) Pharmaceuticals.

7.6 Analysis of Risk Management

7.6.1. Risk-management policy and organizational structure

The company carries out risk management via acknowledgement, identification, analysis, and evaluation of potential risks before controlling, handling, and monitoring them via proper methods and then formulating improvement plan for centralized management and tiered executions according to the features and range of effect of risks, so as to have a firm grip of all risks.

The company's major risk-management organization and unit in charge of risk-management execution follow:

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1. Financial risk, liquidity risk, credit risk, and legal risk:

For the management policy, assessment, responsive strategy, and quantified exposure information for such risks, refer to page 55~59 of Appendix A.

1. Market risk

In daily operation, various business and functional units formulate and execute various strategies according to their respective authorities and evaluate various countermeasures via analysis of changes in laws/regulations, policies, and markets. At times of possible marketrisk crisis, put forth necessary risk management and handling method at regular management meeting.

1. Strategy and management risk

2. The company has been tracking management performance continuously and adjust business strategy timely, in line with changes in market competition and pharmaceutical laws/regulations, so as to lower management risk and ensure business strategy conforming to corporate vision and facilitating attainment of corporate business target. Dimensions and management mechanism of business risks follow:

3. (1) Compliance with pharmaceutical safety and laws/regulations: study and law-making for pharmaceutical safety, pharmaceutical-safety inspection and execution, control of CGMP production flow, crisis management;

4. (2) Consolidating market status: Reinforcement of corporate core value, strengthening of competitiveness, development of new products, and continuing optimization of flow;

5. (3) Management of raw materials: procurement-risk evaluation, supplier management;

6. (4) Analysis and management cost: analysis and management of inventory cost, cost of manufacturing flow, and cost of raw materials;

7. (5) Control of accounts receivable: risk management for accounts receivable

8. (6) Business of risk management units: adjustment of strategy timely

4. Auditing office

The company's major business decisions are evaluated and analyzed by units in charge before submission to the board of directors for resolution and then execution. According to risk assessment and legal requirements, the auditing office formulates annual auditing plan and evaluation procedure and method, as basis for continuing management of aforementioned potential risks and submit the auditing results to the board of directors for perusal periodically.

7.6.2 Effects of Changes in Interest Rates, Foreign Exchange Rates and Inflation on Corporate Finance, and Future Response Measures

(1) Effect of change in interest rate

There is no obvious risk deriving from change in interest rate for the company now. According to its financial statement, the Taiwanese parent company raked into net interest income of NT$20,871 thousand dollars in 2020, accounting for 0.69% of operating revenue and 4.63% of operating profit, mainly due to lack of large outlays for fixed assets and equipment, resulting in relatively sufficient operating fund. In assets allocation, the company invests mainly in short-term products with fixed returns, such as bank deposits, negotiable

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instruments, bonds with repo agreement, to assure the safety and liquidity of principal. The consolidated financial statement shows that net interest income amounted to NT$16,088 thousand dollars in 2020, accounting for 0.52% and 4.28% of operating revenue and operating profit, respectively, thanks to full repayment of bank loans by SciAnda (Changshu) Pharmaceuticals, Ltd. following completion of its merger with SciAnda (Kunshan) Biotech Co., Ltd. on Aug. 18, 2020. SciAnda (Changshu) Pharmaceuticals, Ltd. will seek bank loans with good conditions to meet its need for operating fund, following gradual unfolding of its operation. In assets allocation, the subsidiaries will also invest mainly in short-term products with fixed returns, to assure the safety and liquidity of principal.

		Unit: NT$thousands
Item	2020 Parent Company Only Financial statement	2020 Consolidated Financial statement
Net interest income (expense) –(1)	20,871	16,088
Operating revenue-(2)	3,046,220	3,082,928
Operating profit -(3)	450,854	375,723
Net interest income (expense) to operatingrevenue-(1)/(2)	0.69%	0.52%
Net interest income (expense) to operating profit-(1)/(3)	4.63%	4.28%

In line with the plan for future capital expenditures, the company and its affiliates will be monitoring closely change in interest rate, to ward off adverse effect of change in interest rates on the company's business development. In view of possible funding need in the future, the company will adopt the following countermeasures according to actual need, to sidestep the effect of change in interest rate:

• A. Funding from financial institutions: The company has maintained a good relationship in dealing with financial institutions, such as banks and bills finance companies, retained proper loan quota, and periodically evaluate the discrepancy between loan rate and average market rate, ready to secure most preferential interest rates when it needs to borrow from financial institutions.

• B. Taking advantage of the capital market: The company is ready, whenever necessary for business development, to float corporate bonds or convertible bonds for direct finance or carry out cash capital increment, to lower funding cost.

• C. Plural fund-raising channels: In line with the scale of capital expenditures, the company can also secure syndicated banking loan. It can also borrow foreign currencydenominated loans or float overseas convertible bonds, to meet the need of foreign currency-denominated funds, maintaining a flexible fund-funding method.

• D. Effect of change in laws/regulations: As for the Chinese subsidiary, it is necessary to notice the effect of change in laws/regulations on funding method, as well as possible overall effect resulting from change in interest and exchange rates, in order to seek optimal funding channel.

• (2).Effect of change in foreign exchange rate

According its financial statement, the Taiwanese parent company incurred NT$21,027

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thousand dollars of net exchange-rate loss in 2020, 0.69% and 4.66% of operating revenue and operating profit, respectively, due mainly to continuing devaluation of the U.S. dollar against the New Taiwan dollar, a result of the resumption of quantified easing monetary policy of the U.S. Federal Reserve Board amid the raging COVID-19 pandemic and massive influx of foreign funds into the Taiwanese stock market. Despite the parent company's effort hedging forex-rate risk with purchase of forward foreign exchange and other methods, it still incurred higher foreign exchange loss than the previous year, due to high hedging cost caused by low midsession exchange rate and U.S.-Taiwan interest spread.

Consolidated financial statement shows net exchange-rate loss at NT$28,966 thousand dollars in 2020, amounting to 0.94% and 7.71% and operating revenue and operating profit, respectively, mainly due to weak U.S. dollar and influx of foreign funds into emerging markets, driving down exchange rates of U.S. dollar against New Taiwan dollar and Renminbi, a change which affected both the Taiwanese parent company and the Changshu subsidiary, leading to higher exchange-rate loss of the group than the previous year.

		Unit: NT$thousands
Item	2020 Parent Company OnlyFinancial statement	2019 consolidated financial statement
Net currency exchange gain (loss)-(1)	(21,027)	(28,966)
Operating revenue-(2)	3,046,220	3,082,928
Operating profit-(3)	450,854	375,723
Net currency exchange gain (loss) to operatingrevenue-(1)/(2)	(0.69%)	(0.94%)
Net currency exchange gain (loss) to operating profit-(1)/(3)	(4.66%)	(7.71%)

With its output mainly for overseas markets, the Taiwanese parent company's sale revenue is denominated mostly in U.S. dollar, different from payment which is mainly in New Taiwan dollar, except some portion of U.S. dollar and euro. For subsidiaries in mainland China, with the gradual unfolding of the operation of SciAnda (Changshu) Pharmaceuticals, revenue is denominated mainly in the U.S. dollar, with a portion in Renminbi, different from payment which denominated mainly in Renminbi, with a portion in U.S. dollar and other foreign currencies. Therefore, revaluation of the U.S. dollar against the New Taiwan dollar and Renminbi would bring favorable influence on the revenues and profits of the company and subsidiaries and vice versa, with the extent of influence proportionate to the scale of exchange-rate swing.

The company has adopted the following countermeasures for the possible effect of change in exchange rate:

• A. The financial unit keeps close contact with the foreign exchange departments of financial institutions, constantly collects information on change in exchange rate, and have firm grip on the international trend of exchange rates and political and economic development, as reference for engagement in foreign-exchange trading and counter the adverse effect of exchange-rate fluctuation.

• B. The financial unit engages in certain extent of forward forex trading for risk hedging and proposes evaluation report periodically, as reference for the management to make judgment.

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• C. Make general evaluation of the effect of exchange/interest rates and adjust currency denominations for debt position properly, so as to ward off the adverse effect of exchangerate fluctuation.

• D. Make payment for procurements in currencies similar to the denominated currencies for proceeds from sales, so as to achieve a risk-hedging effect automatically.

• E. Business or procurement units should consult financial unit on trend of exchange rates and other factors of influence before offering quotes, to facilitate overall consideration and evaluation.

• (3)The effect of inflation

According to the statistics of the Directorate General of Budget, Accounting, and Statistics in Taiwan, Taiwan's consumer price index (CPI) and wholesale price index slipped 0.23% and 7.80%, respectively, in 2020 from the 2019 levels, while China's CPI and PPI (producer price index) rose 2.5% and dropped 1.8%, respectively, in 2020, from the 2019 levels, exhibiting general price stability in both cases. Following the outbreak of COVID-19 pandemic, central banks worldwide embraced loose monetary policy to bolster their economies in 2020, when consumers became conservative in spending and international raw materials price remained low. Despite the absence of inflation now, the company will continue monitoring the price trend of raw materials, adjusting sales prices and increasing stock of raw materials, should inflation drive up purchase cost in the future, on top of diversifying supply sources, to alleviate the effect of cost spike on the company's profit.

7.6.3 Policies, Main Causes of Gain or Loss and Future Response Measures with Respect to High-risk, High-leveraged Investments, Lending or Endorsement Guarantees, and Derivatives Transactions

• (1) High-risk and high-leveraged investment

• In line with the principle of stability for business development, the company shuns high-risk and high-leveraged investments.

• (2) Lending, endorsement, and guarantee

In response to operating need of the business group, the company and subsidiaries in China has formulated, according to the regulations of competent authority, "procedure for loan extension to others" and "procedure for provision of endorsement and guarantee," as the basis in execution and risk assessment and effective control by related units. Meanwhile, according to the "Regulations Governing Establishment of Internal Control System by Public Companies," the auditing unit has instituted related system, to carry out risk management and auditing works.

In loan extension, following the merger between SciAnda (Changshu) Pharmaceuticals, Ltd. and SciAnda (Kunshan) Biotech Co., Ltd., there has been no loan extension on the part of Chinese subsidiaries. Therefore, the group had no outstanding loans extended to others as of the end of 2020.

In endorsement and guarantee, the company's board of directors resolved in March 2020 continuing to extend endorsement and guarantee to subsidiary SciAnda (Changshu) Pharmaceuticals, Ltd. in its application for midterm bank loans, with the company's outstanding amount for endorsement and guarantee reaching NT$1,005,928 thousand dollars at the end of 2020.

• (3) Trading in derivate

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The parent company ScinoPharm Taiwan, Ltd. and its subsidiaries in China have formulated their respective "procedure for acquisition and disposal of assets" as basis governing transactions in derivatives, which are mainly for the purpose of hedging market risk deriving from fluctuation in exchange rate for foreign currency-denominated assets (liabilities), excluding arbitrage and speculation.

In 2020, there was unrealized loss of 2,295 thousand dollars on financial instrument in both the financial statement of the parent company in Taiwan and the consolidated financial statement, due to the high risk-hedging cost resulting from large interest-rate spread between Taiwan and the U.S., despite purchase of forex forward by the parent company. The mainland Chinese subsidiary didn't engage in trading in derivatives.

In the future, the company will still engage in derivatives trading for lowering risks from fluctuation in exchange rate and interest rate, while shunning speculative trading. and will adjust risk-hedging strategy properly in the future, in line with the company's business status and market trend. Meanwhile, according to "procedure for acquisition or disposal of assets, the company evaluates trading status monthly for report to management as basis for decision making.

7.6.4 Future Research & Development Projects and Corresponding Budget

Given long period and high uncertainty for R&D on pharmaceuticals, on top of strong R&D strength and technological advantages, ScinoPharm Taiwan has invested heavily in R&D every year. Taking advantage of high-specifications cGMP production equipment and abundant experience accumulated over a long term, the company has not only developed products with market potential but also installed innovative technological platform, facilitating joint development of new preparations and new drugs with business partners and ushering the company into a new era.

On the existing base, the company will continue developing active pharmaceutical ingredients for new anti-cancer and central nerve system drugs featuring timeliness and new process. Meanwhile, from the angles of market potential, production difficulty, and manipulability, evaluate cautiously new crystal form or new combination of APIs for antiviral agents and chronic-disease medicines. Especially, in the field of combination medicines, the company's past efforts are expected to bear fruit gradually, thanks to progress in related technology which focuses on process, taking advantage of the features of combination medicines to provide transmission function for targeted therapy and thereby enhance medicine effectiveness and lowering side effect. Moreover, with increasing amount of new peptide drugs, ScinoPharm Taiwan's peptide-drug technological platform will exhibit its advantageous function, facilitating the development of APIs for peptide drugs which feature high technological threshold.

In addition to continuing focus on the core business of anti-cancer APIs for consolidation of the company's leading market status, ScinoPharm Taiwan will gradually extend to the R&D on recipe and process for injection cancer drugs and obtain permit for new drug via simplified application procedure in the U.S. and Europe. Another R&D focus is recipe for new preparations and drug-administration technology, in the hope of developing patented niche pharmaceuticals. In combination with the production capability for injection drugs, ScinoPharm Taiwan will extend the value chain of its pharmaceuticals to injection drugs, from the original field of APIs.

The company appropriates R&D budget according to plan for new-product development, with R&D expense accounting for 7-10% in past years. Along with revenue growth, the

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company will gradually increase its R&D budget, to boost corporate competitiveness. The company expects to invest NT$500 million in R&D in the coming two years.

7.6.5 Effects of and Response to Changes in Policies and Regulations Relating to Corporate Finance and Sales:

While government policies and legal changes in Taiwan and abroad had limited effect on the operation of the company in 2020, the company will continue monitoring such changes closely and adopt proper countermeasures timely, to alleviate the impact.

7.6.6 Effects of and Response to Changes in Technology and the Industry Relating to Corporate Finance and Sales

The company's R&D team outperforms peers in product development and closely monitors, along with marketing and planning teams, general trend for pharmaceutical development and technological progress, as the basis for medium- and long-term development plan. Since the company's APIs are self-developed ones entirely, there is no any problem concerning patent infringement. The company has spared no effort in technological innovation and development of patented progress, to uphold product competiveness. Taking advantage of established basis, the company has been developing new products actively every year, so as to expand product lineup and support the company's global deployment. In addition to APIs, the company has stepped into the realm of production of preparations and, via joint venture, new drug development, gradually becoming an all-round pharmaceutical firm. The company has adhered to the principle of balancing efforts for short-, medium-, and long-term development, capable of coping with technological and industrial changes, without affecting financial soundness.

7.6.7 The Impact of Changes in Corporate Image on Corporate Risk Management, and the Company’s Response Measures

In adherence to the concept of sustainable development and long-term partnership with customers and communities, the company regards highly corporate image and risk management, publicizing business status at shareholders' meeting and investors' conference regularly, so as to increase financial transparency. In addition, the company has taken part actively in communal and public-service events, fulfilling its social responsibilities. There are designated staffers to handle various unexpected happenings, minimizing uncertainty for corporate operation. Therefore, there was no major happening which harmed corporate image and caused corporate crisis.

7.6.8 Expected Benefits from, Risks Relating to and Response to Merger and Acquisition Plans

As of the date for the publication of the yearbook, the company had no other M&A plan. Should there be any such plan in the future, the company will cautiously evaluate, according to the company's "measures for acquisition and disposal of assets," whether it can bring concrete synergy to the company, so as to uphold the interest of the company and shareholders.

7.6.9 Expected Benefits from, Risks Relating to and Response to Factory Expansion Plans

Due to progress in uperization equipment and technology, requirements of international

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laws/regulations on the production and quality of injection medicines have become increasingly stringent. As a result, many renowned injection-medicine plants have been forced to suspend their operations, due to inability to meet cGMP requirements on factory design or product quality, leading to short supply for many injection medicines.

In line with the development trend of the pharmaceutical industry, the company has been endeavoring to strengthen the competitiveness of the entire supply chain. The new injection plant in Tainan has been ready for operation, following installation of two production lines in 2017, certification of plant and equipment in 2018, In 2019, the company finished the registration batches for 2 projects. In 2020, the company filed the first ANDA in US. Following inauguration of the new plant, on top of supplying generic drugs and APIs for new medicine, the company will be able to provide trustworthy contract-production service to branded customers. Expected benefits, possible risks, and countermeasures of the injection-medicine plant follow:

• (1) Benefits

• ScinoPharm's ampule plant meets the highest specifications of international regulations in design, including sterile glove-box filling lines, minimizing sterile operating space and human interference with the sterile environment. Disposable materials are employed at production lines as much as possible, to avoid cross contamination brought about by washing and repeated usage.

• Of the two existing production lines, one is capable of turning out advance-filled and cartridge ampules with high activity and the other cytotoxic liquid and frozen dry anticancer ampules, taking advantage of the company's expertise in anti-cancer API. Thanks to the advantages of high sterility and product-switch flexibility of glove-box filling lines, ScinoPharm's ampule plant turns out cartridge-bottle and advance-filled ampules, facilitating development of production of generic-drug ampules and contract production for international ampule firms in the future. Given its simultaneous engagement in development and production of APIs and ampules, ScinoPharm is expected to create even more opportunities for different business cooperation models, leading to higher competitiveness in the pharmaceutical industry.

• (2) Risks/Adaptive measures

While expansion to injection-medicine production in the manner of vertical integration will boost the company's competiveness, thanks to the effect of market segmentation, the new injection-medicine plant faces the risk of low capacity utilization rate and idle equipment, should orders fail to meet expectation. As countermeasures, the company will strive to solicit one-stop shopping business, covering API and injection medicines, from customers and offer custom process service, according the features of customers' products, on top of continuing cooperation with generic-drug customers in the U.S. and Europe in tapping the market of self-developed generic drugs to reduce the risk.

7.6.10 Risks Relating to and Response to Excessive Concentration of Purchasing Sources and Excessive Customer Concentration

In both 2019 and 2020, the company's main customers were foreign pharmaceutical firms, all among the top 100 generic-drug firms conforming to standards of U.S. FDA and

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pharmaceutical regulators in Europe and Japan. The company sold to them products featuring its key technologies. The company has won their firm trust, thanks to yearslong effort in process optimization, capacity enhancement, and cost reduction, plus excellent plant inspection record over the past years. Therefore, materials sold by the company to foreign drug plants cannot be replaced easily. In addition to firm relationship with existing customers, the company has also spared no effort in seeking new customers, without the risk of concentrated sales.

7.6.11 Effects of, Risks Relating to and Response to Large Share Transfers or Changes in Shareholdings by Directors, Supervisors, or Shareholders with Shareholdings of over 10%: None

7.6.12 Effects of, Risks Relating to and Response to the Changes in Management Rights: There is no change in operating right in the most recent years.

7.6.13 Litigation or Non-litigation Matters:

• (1) Major ongoing lawsuits, non-lawsuits or administrative lawsuit: List major litigations, non-contentious cases, and administrative litigations, including those with settled ruling or still in progress, involving whose outcomes may have major influence on shareholders' equity or security prices. Disclose the facts of the contentions, values of targets, starting dates of litigations, major parties involved, and status of handling: Jianggu Qi'an Construction Group Co., Ltd. filed suit with people's court of Changshu City, Jiangsu Province, against subsidiary SciAnda (Changshu) Pharmaceuticals, Ltd. on Dec. 7, 2020 over cable-wire pricing dispute, demanding payment of 12,694,982 yuan, which is being tried by the court. With cash in hand on the accounts of the company and SciAnda (Changshu) Pharmaceuticals, Ltd. sufficient to support normal operation and the target of the aforementioned litigation being construction of factory building, with no bearing on the company's products, plus completion and inauguration of the said factory, the case will not have major influence on the company's operation and sale.

In sum, the ongoing litigation will not have major influence on the operation and finance of the company and subsidiaries, nor will it cause dissolution of the company or change in organization or capital.

• (2) List major litigations, non-contentious cases, administrative litigations, including those with settled ruling or still in progress, involving the company's directors, supervisors, president, actual responsible person, major shareholders with over 10% shareholding, and subordinated companies in recent two years and as of the date of the publication of the annual report, whose outcomes may have major influence on shareholders' equity or security prices: nil.

7.6.14 Other Major Risks:

In a continuing effort to improve and strengthen information safety, ScinoPharm Taiwan has put in place a complete information safety system, rigorously controlling informationsafety risk, so as to uphold key corporate operations, including management, production,

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and quality control, and assure the confidentiality, integrity of corporate data and safety.

A special team in the information division is in charge of information security, which reviews possible problems in the company's information security risk management structure at information division's quarterly meeting and reports execution status for information security to vice president of the administrative center irregularly, to assure stable operation of the information security system. Although the company has yet to take out information-security insurance, the company has adhered to three themes in information-security strategy, namely information-security management, new technology utilization, and legal compliance, with brief introductions to the three themes follows:

1. As for strengthening information-safety management, in addition to conformance to the most rigorous information-safety requirement in planning network structure, the company has resorted to the assistance of outside information-safety specialists and endeavored to pinpoint possible or potential problems for rectification. The company Participate in science park's joint information safety program SP-ISAC, exchange intelligence on information-safety risk with peers. Install various monitoring systems for early detection and fixing of possible or potential problems. The company strictly manages account authorization, privileged accounts, and operating environment, to materialize access/retrieval control and prevent tampering. Install e-data protection program, such as document encryption system and printing control, to safeguard document confidentiality, prevent data leak, and protect business secrets. On top of installation of firewall system, sandbox system, and APT protection technology, so as to ward off hacker attack, DDos attack, advanced continuing attack, compute virus, spam, social-engineering attack, thereby lowering information-safety risk.

2. Take advantage of new technology to strengthen data protection and enhance system usability and capability for continuing operation, such as planning for multi-layer backup copy structure, institution of virtual system backup copy, and continuing data protection (CDP) program, on top of periodic disaster recovery test for key systems and verification of the efficacy of protection mechanism, continuing push of virtualized system, flexible management of hardware resources, enhancement of the usability of important systems, and lowering of the risk of hardware malfunction. . The company implements the ultimate goal of corporate sustainable development via remote supporting mechanism.

3. The company has dedicated to installation of information systems conforming GMPs of various countries, including US 21-CFR Part 11, EU EUDRALEX Volume 4 Annex 11, and maintenance of the status of conformance. The company has also complied with various regulations on data integrity, such as US FDA, MHRA, WHO, PIC/S, pushing information safety according rigorous standards. (3) the Company strives to construct the information system that in compliance with the GMP regulation worldwide, including US21-CFR Part 11, EU EUDRALEX Volume 4 Annex 11, and to maintain continuously compliance; The company is in compliance with the Data Integrity provision such as: US FDA, MHRA, WHO, PIC/S and even utilize more stringent standards to advance the information system safety.

7.7 Other Important Matters: None

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VIII.Special Disclosure

8.1 Summary of Affiliated Companies

8.1.1 Consolidated Business Report of Affiliated Companies

8.1.1.1Affliated Companies Chart

==> picture [683 x 350] intentionally omitted <==

----- Start of picture text -----

2020.12.31
ScinoPharm
Taiwan, Ltd.
100% 100%
ScinoPharm
SPT International,
Singapore Pte Ltd.
Ltd. (BVI)
(Singapore)
100% 100% 100%
SciAnda Shanghai
SciAnda (Changshu)
Biochemical Technology,
Pharmaceuticals, Ltd.
Ltd
----- End of picture text -----

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8.1.1.2 of Affiliated Companies Information 2020.12.31

Name of Corporation	Date of Establishment	Address	Paid-in Capital	Major Business Production Items
ScinoPharm Taiwan, Ltd.	1997.11.11	No.1, Nan-Ke 8th Road, Southern Taiwan Science Park, Shan-Hua,Tainan,74144,Taiwan	NT$7,907,392,220	API Manufacturing and sale
SPT International, Ltd.	1998.10.22	P.O. Box 957, Offshore Incorporations Centre, Road Town, Tortola, British Virgin Islands.	US$118,524,644	Common investment business
ScinoPharm Singapore Pte Ltd.	1999.11.13	50 Raffles Place #06- 00 Singapore Land Tower, Singapore 068808	SG$2	Common investment business
SciAnda (Changshu) Pharmaceuticals, Ltd.	2009.08.18	No. 16, Dong Zhou Rd., Economic Development Zone, Changshu, Jiangsu, China	US$116,500,000	Production of heterocyclic fluoride and other fluorine-containing highly active intermediates and preparations; R&D on recipe of active pharmaceutical and crafting, recipe of preparations, and consulting for on biotech R&D; sale of own products Agency, sale, and export of active pharmaceutical ingredients and intermediates and consulting for biotech R&D
SciAnda Shanghai Biochemical Technology, Ltd.	2011.11.15	Room 209, Block B, Uni-President Building, NO.568 Tianshan west Road, Changning District, Shanghai, 200335,China	US$1,200,000	Agency, sale, and export of active pharmaceutical ingredients and intermediates and consulting for biotech R&D

8.1.1.3 Data of Common Shareholders of Treated-as Controlled Companies and Affiliates: None.

8.1.1.4 Business covered by ScinoPharm and its Affiliated Enterprises: Pharmaceutical, biotech service, and equity investment

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8.1.1.5 Directors, Supervisors and Presidents of Affiliated Companies 2020.12.31, Unit: Shares; %,

8.1.1.5 Directors, Su	pervisors and President	s of Affliated Companies	2020.12.31, Unit: Shares; %,	2020.12.31, Unit: Shares; %,
Company	Title	Name or Representative	Shareholding (Note)
			Shares(Amount)	%
ScinoPharm Taiwan, Ltd.	Chairman	Chih-Hsien Lo (Representative of Uni-President Enterprises Corp.)	299,968,639	37.94%
	Director	Tsung-Ming Su (Representative of Uni-President Enterprises Corp.)	299,968,639	37.94%
	Director	Kun-Shun Tsai (Representative of Uni-President Enterprises Corp.)	299,968,639	37.94%
	Director	Tsung-Pin Wu (Representative of Uni-President Enterprises Corp.)	299,968,639	37.94%
	Director	Fu-Jung Lai (Representative of Uni-President Enterprises Corp.)	299,968,639	37.94%
	Director	Jia-Horng Guo (Representative of Uni-President Enterprises Corp.)	299,968,639	37.94%
	Director	Po-Ming Hou (Representative of Tainan SpinningCo.,Ltd.)	23,605,921	2.99%
	Director	Shiow-Ling Kao (Representative of Kao Chyuan Investment Co.,Ltd.)	14,832,733	1.88%
	Director	Ming-Chuan Hsieh (Representative of National Development Fund,Executive Yuan)	109,539,014	13.85%
	Director	Ya-Po Yang (Representative of National Development Fund,Executive Yuan)	109,539,014	13.85%
	Director	Chiou-Ru Shih (Representative of President International Development Corp.)	28,673,421	3.63%
	Director	Kuo-Hsi Wang (Representative of Taiwan Sugar Corporation)	32,581,963	4.12%
	Independent Director	Wen-Chang Chang	0	0%
	Independent Director	Li-Tzong Chen	0	0%
	Independent Director	Wei-Te Ho	0	0%
	CEO	Tsung-Ming Su	0	0%

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Company	Title	Name or Representative	Shareholding (Note)	Shareholding (Note)
			Shares(Amount)	%
SPT International, Ltd.	Institute Director	Tsung-Ming Su(Representative of ScinoPharm Taiwan, Ltd.)	118,524,644	100%
ScinoPharm Singapore Pte Ltd	Director	Ching-Wen Lin (Representative of ScinoPharm Taiwan,Ltd.)	2	100%
	Director	Chih-Hui Lin (Representative of ScinoPharm Taiwan,Ltd.)	2	100%
	Independent Director	Leong Yean-Shen, Jimmy	0	0%
SciAnda (Changshu) Pharmaceuticals, Ltd.	Chairman	Shou-Cheng Yang (Representative of SPT International,Ltd.)	US$116,500,000	100%
	Director	Ling-Hsiao Lien (Representative of SPT International,Ltd.)	US$116,500,000	100%
	Director	Ching-Wen Lin (Representative of SPT International,Ltd.)	US$116,500,000	100%
	Director	Gloria Chang (Representative of SPT International,Ltd.)	US$116,500,000	100%
	Supervisor	Chih-Hui Lin (Representative of SPT International,Ltd.)	US$116,500,000	100%
	Supervisor	Shun-Yang Lin (Representative of SPT International,Ltd.)	US$116,500,000	100%
SciAnda Shanghai Biochemical Technology, Ltd.	Chairman	Shou-Cheng Yang (Representative of SPT International,Ltd.)	US$1,200,000	100%
	Director	Ling-Hsiao Lien (Representative of SPT International,Ltd.)	US$1,200,000	100%
	Director	Ching-Wen Lin (Representative of SPT International,Ltd.)	US$1,200,000	100%
	Director	Gloria Chang (Representative of SPT International,Ltd.)	US$1,200,000	100%
	Supervisor	Chih-Hui Lin (Representative of SPT International,Ltd.)	US$1,200,000	100%

Note: Shareholding column lists either shares or amounts

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8.1.1.6 Summarized Operation Results of Affiliated Enterprises 2020.12.31; Unit: NT$ thousands

Name of Corporation	Paid-in Capital	Total Assets	Total Liabilities	Net Worth	Net Operating Revenues	Operating Income	Net Income (After Tax)	Earnings Per Share (NT$) (After Tax)
ScinoPharm Taiwan, Ltd.	7,907,392	11,776,921	1,247,518	10,529,403	3,046,220	450,854	282,067	0.36
SPT International, Ltd.	3,595,107	1,745,203	0	1,745,203	0	(91)	(101,127)	-0.85
ScinoPharm Singapore Pte Ltd.	0	227	102	125	354	16	13	6,256
SciAnda (Changshu) Pharmaceuticals, Ltd.	3,317,920	1,842,819	117,051	1,725,768	440,660	(85,552)	(100,904)	N/A
SciAnda Shanghai Biochemical Technology, Ltd.	34,176	17,280	1,073	16,207	16,912	282	37	N/A

Note: Affiliates for foreign companies, information comes from reports and statements compiled by affiliates themselves, related figures are based on the following conversion rates:

• (1) Figures in balance sheet are based on the spot exchange rates on 2020.12.31 RMB:NTD = 1 ： 4.363280 USD:NTD = 1: 28.48

• (2) Figures in income statement are based on average exchange rates in 2020 RMB:NTD = 1: 4.281483 USD:NTD = 1: 29.533180

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ScinoPharm Taiwan, Ltd.

Statement on Affiliates Report

March 18, 2021

The company's 2020 affiliates report (Jan. 1 through Dec. 31, 2019) was compiled according to "guidelines for compilation of consolidated business report, consolidated financial report, and affiliates report," and its disclosed information has no discrepancy with information contained in the notes of financial statements for the same period.

Company name: ScinoPharm Taiwan, Ltd. Chairman: Chih-Hsien Lo March 18, 2021

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==> picture [162 x 69] intentionally omitted <==

ScinoPharm Taiwan, Ltd.

Re-auditing report by Certified Public Accountant on Affiliates Report

No. 20008565

To ScinoPharm Taiwan, Ltd.:

ScinoPharm's 2020 affiliates report was compiled on March 18, 2021 according to "guidelines for compilation of consolidated business report, consolidated financial report, and affiliates report," and its disclosed information has no discrepancy with information contained in the notes of financial statements for the same period.

The certified public account didn't find any major deviation from the aforementioned statement after comparing the affiliates report and notes in ScinoPharm Taiwan's 2020 financial statement.

PricewaterhouseCoopers, Taiwan

Yung-Chih Lin

Independent Accountants

Tzu-Meng Liu

Financial Supervisory Commission R.O.C.(Taiwan) Approval of certifications: Financial –Supervisory –Securities#1050029592

Former Securities Management Committee, the Ministry of Finance

Approval of certifications: No. (84) Taiwan-Finance-Securities-(6)-29174

March 18, 2021

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ScinoPharm Taiwan, Ltd.

1. Status of relationship between affiliated companies and controlling company

The company is subordinated to Uni-President Enterprises Corp., with information on the relationship listed below:

Unit: Share ； %

					Unit: Share；%	Unit: Share；%
Controlling company	Controlling reason	Shareholding of controlling company and status of mortgage			Directors, Supervisors, or Managers representing the controlling company
		Number of shares owned	Share of stake	Amount of mortgaged shares	Title	Name
Uni-President Enterprises Corp.	That company owns, directly and indirectly, seven seats on the board of directors of the company, directly controlling the company's personnel, finance, and business management.	Uni-President Enterprises Corp. 299,968,639 shares	37.94%	─	Director Director Director Director Director Director	Chih-Hsien Lo Jia-Horng Guo Tsung-Ming Su Kun-Shun Tsai Tsung-Pin Wu Fu-Jung Lai
		President International Development Corp. (Note 1) 28,673,421shares	3.63%	20,000,000 shares	Director	Chiou-Ru Shih
		Tong Yu Investment Corp. (Note 2) 14,299,166 shares	1.81%	─	─	─
		Kai Yu Investment Co., Ltd. (Note 3) 14,763,165 shares	1.87%	─	─	─
		Kai Nan Investment Co., Ltd. (Note 3) 13,950,061shares	1.76%	─	─	─

。 (Note 1) Uni-President Enterprises Corp. owns 69.37% stake

。 (Note 2) President International Development Corp. owns 100% stake

(Note 3) Uni-President Enterprises Corp. owns 100% stake.

Chairman ： Chih-Hsien Lo CEO ： Tsung-Ming Su Director of Accounting ： Chih-Hui Lin

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ScinoPharm Taiwan, Ltd.

1. Dealings between subordinated companies and controlling company:

2. (1) Procurement and sale: None

3. (2) Property transaction: None

4. (3) Financing: None

5. (4) Lease of assets: None

6. (5) Other major dealings: None

ther major dealings: None	ther major dealings: None	ther major dealings: None
			NT$ thousand;%
Transaction with ControllingCompany			Transaction Terms between Normal Transaction and Controlling Company
Item	Amount	Item Amount%
Other Expense	$ 4,592	1%	No major discrepancy

1. Provision of endorsement and guarantee between subordinated companies and controlling company: None

Chairman ： Chih-Hsien Lo CEO ： Tsung-Ming Su Director of Accounting ： Chih-Hui Lin

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8.2 Private Placement Securities in the Most Recent Years: None

8.3 The Shares in the Company Held or Disposed of by Subsidiaries in the Most Recent Years : None

8.4 Other Necessary Supplement

8.4.1 The company's key performance index (KPI)

In line with features of the pharmaceutical industry, the company uses the number of registration for DMF (drug master file) as the KPI.

As the number of product registration parallels the number of products developed by a pharmaceutical company, the number of DMF has been used to embody a company's R&D strength. The company aims to apply for four to five DMF registrations in major countries each a year. In 2020, the company applied for 40 DMF registrations worldwide, including 3 in the U.S. As of April 2021, the company had 872 DMF registrations worldwide.

8.4.2 Criteria and basis for the evaluation of provisions for assets/liabilities evaluation items

• (1) Policy for provisions for bad debts of accounts receivable Evaluation criteria: Measures for analyzing debt amount and debt length Evaluation basis: Percentages of provisions according to debt length Customer debts are classified into two kinds:

•  For customers which are leading enterprises of a specific industry with good record of dealings with the company over the past three years and over 5% share in the company's sales, there are no provisions for bad debts.

Overdue length of debts	Percentage ofprovisions
1-~30 days	0.05%
31~60 days	0.10%
61~90 days	0.25%
91~180 days	10%
More than 180days	100%

•  For other customers, bad-debt provisions are appropriated according to the length of overdue debt, as shown in the following:

Overdue length of debts	Percentage ofprovisions
1-~30 days	0.10%
31~60 days	0.20%
61~90 days	0.50%
91~180 days	10%
over 180 days	100%

The accounting unit calculates the amount of bad-debt provisions according to the aforementioned basis and adjusts the value under the item "bad-debt provisions" accordingly.

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• (2) Provisions for the loss on inventories from market price decline

The company embraces a perpetual inventory system, whose cost is calculated with a weighted average method. The value of inventory at the end of the current term is set according to cost or net realizable value, whichever is lower. The comparison between cost and net realizable value is made item by item. Net realizable value refers to the balance of estimated sales value deducting the cost of input needed for completion of work and marketing expense. Provisions for price decline must be made and listed as current operating cost, should cost exceed net realizable value. Should net realizable value rise again, the increase can be used for reverse the loss, within the balance of allowance for loss on inventory market price decline and listed as a reduction item for current operating cost.

In evaluating the price-decline loss on inventory, products in the same category are evaluated together

8.4.4. Evaluation of financial products

The company uses the following method and assumption in evaluating the fair value of financial products:

• (1) In the short term, due to little different in discounting value, paper value is used in gauging fair value. The method applies to cash, cash equivalent, accounts receivable, other accounts receivable, other financial assets-liquidity, notes payable and debt, expense payable, other expenses payable, and rentals payable-liquidity.

• (2) Other financial assets--Discounting value based on expected cash flow is used in evaluating the fair value of noncurrent and refundable deposits. The discount rate is equivalent to the fixed interest rate for one-year time deposits at the end of the current term at Chunghwa Post.

• (3) Discounting value based on expected cash flow is used in gauging the fair value of refundable deposits. The discount rate is based on the interest rates available for the company for securing loans with similar conditions.

• (4) The evaluation of the fair value of derivatives is based on expected amount which the company can obtain or must pay, should it terminate the contract on the date of the financial statement, ahead of due date. It generally contains unrealized benefit for the settlement of contract at the end of the current term.

• (5) The company's forward-forex contracts are based on quotes for spot or forwardforex rates shown on the webpage of Bank of Taiwan. Therefore, the unrealized benefit/loss of a specific forward-forex contract is calculated according to forward-forex rate on the due date of the contract.

8.5 Other Supplementary Disclosure

If any of the situations listed in Article 36, paragraph 3, subparagraph 2 of the Securities and Exchange Act, which might materially affect shareholders' equity or the price of the company's securities, has occurred during the most recent fiscal year or during the current fiscal year up to the date of printing of the annual report, such situations shall be listed ： None.

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ScinoPharm Taiwan, Ltd.

Chairman ： Chih-Hsien Lo

Address ： No.1, Nan-ke 8[th] Road,

Southern Taiwan Science Park,

Shan-Hua, Tainan, 74144, Taiwan

886 - 6 - 505 2888

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Appendix A

SCINOPHARM TAIWAN, LTD. AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS’ REPORT DECEMBER 31, 2020 AND 2019

---

For the convenience of readers and for information purpose only, the auditors’ report and the accompanying financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. In the event of any discrepancy between the English version and the original Chinese version or any differences in the interpretation of the two versions, the Chinese-language auditors’ report and financial statements shall prevail.

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SCINOPHARM TAIWAN, LTD.

Declaration of Consolidated Financial Statements of Affiliated Enterprises

For the year ended December 31, 2020, pursuant to “Criteria Governing Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises,” the entities that are required to be included in the consolidated financial statements of affiliates, are the same as the entities required to be included in the consolidated financial statements under International Financial Reporting Standards 10. In addition, information required to be disclosed in the consolidated financial statements of affiliates is included in the aforementioned consolidated financial statements. Accordingly, it is not required to prepare a separate set of consolidated financial statements of affiliates.

Hereby declare,

SCINOPHARM TAIWAN, LTD.

By Alex Lo Chairman March 18, 2021

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INDEPENDENT AUDITORS’ REPORT TRANSLATED FROM CHINESE

To the Board of Directors and Shareholders of ScinoPharm Taiwan, Ltd.

Opinion

We have audited the accompanying consolidated balance sheets of ScinoPharm Taiwan, Ltd. and subsidiaries (the “Group”) as at December 31, 2020 and 2019, and the related consolidated statements of comprehensive income, of changes in equity and of cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as at December 31, 2020 and 2019, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission.

Basis for opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and generally accepted auditing standards in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ responsibilities for the audit of the consolidated financial statements section of our report. We are independent of the Group in accordance with the Norm of Professional Ethics for Certified Public Accountants of the Republic of China, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Group’s 2020 consolidated financial statements. These matters were addressed in the context of our audit of the consolidated financial statements as a whole and, in forming our opinion thereon, we do not provide a separate opinion on these matters.

~3~

The key audit matters for the Group’s 2020 consolidated financial statements are stated as follows:

Cutoff of export revenue from Taiwan

Description

Refer to Note 4(28) for accounting policies on revenue recognition and Note 6(19) for accounting items on operating revenue.

The Group’s sales revenue mainly arise from the manufacture and sales of Active Pharmaceutical Ingredient (“API”), which primarily consists of export sales. The Group recognises export sales revenue based on the terms and conditions of transactions which vary with different customers. As revenue recognition involves manual processes and is material to the financial statements, we consider the cutoff of export revenue from Taiwan a key audit matter.

How our audit addressed the matter

We performed the following key audit procedures in response to the above key audit matter:

1. Understood and assessed the effectiveness of internal controls over cutoff of sales revenue and tested the effectiveness of internal controls over shipping and billing.

2. Checked the completeness of the export sales details for a certain period around balance sheet date and performed cutoff tests on a random basis, which included checking the terms and conditions of transactions, verifying against supporting documents, and checking whether inventory movements and costs of sales were recognised in the appropriate period.

Inventory valuation

Description

Refer to Note 4(13) for accounting policies on inventory valuation, Note 5(2)1 for the uncertainty of accounting estimates and assumptions applied on inventory valuation, and Note 6(5) for details of inventories. As at December 31, 2020, the balances of inventory and allowance for inventory valuation losses were $1,643,409 thousand and $397,539 thousand, respectively.

The Group is primarily engaged in the manufacture and sales of API. As the manufacturing process is relatively complicated and time-consuming, materials require longer lead time, the waiting period for product registration is long, and the timing of the product launch may be deferred, there is higher risk of incurring loss on inventory valuation. For inventories sold under normal terms, the Group measures

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inventories at the lower of cost and net realisable value. For inventories aging over a certain period of time and are individually identified as obsolete inventories, the net realisable value is calculated based on the historical information of inventory turnover. Since the calculation of net realisable value involves subjective judgement and the ending balance of inventory is material to the financial statements, we consider the valuation of inventory a key audit matter.

How our audit addressed the matter

We performed the following key audit procedures in response to the above key audit matter:

1. Evaluated the reasonableness of provision policies and procedures on allowance for inventory valuation losses, including the historical data of inventory turnover and judgement of obsolete inventory.

2. Verified whether the dates used in the inventory aging reports that the Group applied to value inventories were accurate. Recalculated and evaluated the reasonableness of allowance for inventory valuation losses in order to confirm whether the reported information was in line with the Group’s policies.

3. Selected samples from inventory items by each sequence number to verify its realisable value and to evaluate the reasonableness of allowance for inventory valuation loss.

Other matter – Parent company only financial reports

We have audited and expressed an unqualified opinion on the parent company only financial statements of ScinoPharm Taiwan, Ltd. as at and for the years ended December 31, 2020 and 2019.

Responsibilities of management and those charged with governance for the consolidated financial statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Group’s

~5~

ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

Those charged with governance, including audit committee, are responsible for overseeing the Group’s financial reporting process.

Auditors’ responsibilities for the audit of the consolidated financial statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the generally accepted auditing standards in the Republic of China will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with the generally accepted auditing standards in the Republic of China, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

1. Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

2. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.

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1. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

2. Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Group to cease to continue as a going concern.

3. Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

4. Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

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From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Lin, Yung-Chih Independent Accountants Liu, Tzu-Meng

PricewaterhouseCoopers, Taiwan Republic of China March 18, 2021

---

The accompanying consolidated financial statements are not intended to present the financial position and results of operations and cash flows in accordance with accounting principles generally accepted in countries and jurisdictions other than the Republic of China. The standards, procedures and practices in the Republic of China governing the audit of such financial statements may differ from those generally accepted in countries and jurisdictions other than the Republic of China. Accordingly, the accompanying consolidated financial statements and report of independent accountants are not intended for use by those who are not informed about the accounting principles or auditing standards generally accepted in the Republic of China, and their applications in practice.

As the financial statements are the responsibility of the management, PricewaterhouseCoopers cannot accept any liability for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the translation.

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SCINOPHARM TAIWAN, LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars)

Assets	Notes 6(1) 6(2) 6(3) 6(4) and 12 6(26) 5 and 6(5) 8 and 9 6(6) 6(7)(9) 6(8) 5 and 6(26) 8	December 31, 2020 AMOUNT % $ 4,054,948 34 - - - - 386,508 3 77,456 1 8,969 - 1,245,870 11 108,075 1 34,311 - 5,916,137 50 308,115 3 4,210,746 36 629,886 5 8,900 - 602,979 5 133,960 1 6,770 - 29,270 - 5,930,626 50 $ 11,846,763 100	December 31, 2019	December 31, 2019
		AMOUNT $ 4,054,948 - - 386,508 77,456 8,969 1,245,870 108,075 34,311 5,916,137 308,115 4,210,746 629,886 8,900 602,979 133,960 6,770 29,270 5,930,626 $ 11,846,763	AMOUNT $ 3,304,978 2,920 172,220 590,336 71,149 8,968 1,124,332 131,681 - 5,406,584 415,210 4,433,860 673,087 14,068 606,123 85,361 11,001 29,270 6,267,980 $ 11,674,564	%
Current assets 1100 Cash and cash equivalents 1110 Financial assets at fair value through profit or loss - current 1136 Financial assets at amortised cost - current 1170 Accounts receivable, net 1200 Other receivables 1220 Current income tax assets 130X Inventories 1410 Prepayments 1476 Other financial assets - current 11XX Total current assets Non-current assets 1517 Financial assets at fair value through other comprehensive income - non-current 1600 Property, plant and equipment 1755 Right-of-use assets 1780 Intangible assets 1840 Deferred income tax assets 1915 Prepayments for equipment 1920 Guarantee deposits paid 1980 Other financial assets - non-current 15XX Total non-current assets 1XXX Total assets				28 - 1 5 1 - 10 1 -
				46
				4 38 6 - 5 1 - -
				54
				100

(Continued)

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SCINOPHARM TAIWAN, LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars)

Liabilities and Equity

December 31, 2020 December 31, 2019 Notes AMOUNT % AMOUNT % 6(10) $ 9,494 - $ 89,766 1 6(2) 2,172 - - - 6(19) 66,846 1 55,985 - 1,173 - 1,353 - 159,671 1 101,018 1 6(11) 362,821 3 333,376 3 6(26) 67,969 1 1 - 16,500 - 16,014 - 6(12) and 9 - - 144,234 1 686,646 6 741,747 6 6(26) - - 584 - 550,182 4 590,020 5 6(13) 79,232 1 82,182 1 1,300 - 87 - 630,714 5 672,873 6 1,317,360 11 1,414,620 12 6(14) 7,907,392 67 7,907,392 68 6(15)(16) 1,294,689 11 1,294,605 12 6(17) 634,265 5 612,600 5 67,825 1 22,829 - 658,275 6 490,344 4 6(18) ( 33,043) ( 1) ( 67,826) ( 1 ) 10,529,403 89 10,259,944 88 9 $ 11,846,763 100 $ 11,674,564 100

Current liabilities 2100 Short-term borrowings 2120 Financial liabilities at fair value through profit or loss - current 2130 Contract liabilities - current 2150 Notes payable 2170 Accounts payable 2200 Other payables 2230 Current income tax liabilities 2280 Lease liabilities - current 2320 Long-term liabilities, current portion 21XX Total current liabilities Non-current liabilities 2570 Deferred income tax liabilities 2580 Lease liabilities - non-current 2640 Net defined benefit liabilities 2645 Guarantee deposits received 25XX Total non-current liabilities 2XXX Total liabilities Equity attributable to owners of parent Share capital 3110 Common stock 3200 Capital surplus Retained earnings 3310 Legal reserve 3320 Special reserve 3350 Unappropriated earnings 3400 Other equity interest 3XXX Total equity Significant contingent liabilities and unrecognised contract commitments 3X2X Total liabilities and equity

The accompanying notes are an integral part of these consolidated financial statements.

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SCINOPHARM TAIWAN, LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME YEARS ENDED DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars, except earnings per share amounts)

Items

Year ended December 31 2020 2019 Notes AMOUNT % AMOUNT % 6(19) $ 3,082,928 100 $ 2,892,783 100 6(5)(24)(25) ( 1,765,469) ( 57) ( 1,716,378) ( 59) 1,317,459 43 1,176,405 41 6(24)(25), 7 and 12 ( 170,904) ( 6) ( 157,168) ( 6) ( 525,418) ( 17) ( 513,796) ( 18) ( 245,633) ( 8) ( 238,373) ( 8) 219 - ( 214) - ( 941,736) ( 31) ( 909,551) ( 32) 375,723 12 266,854 9 6(3)(20) 27,408 1 37,976 1 6(21) 16,378 1 53,874 2 6(2)(9)(22) and 12( 45,838) ( 2) ( 37,961) ( 1) 6(8)(23) ( 15,166) - ( 55,689) ( 2) ( 17,218) - ( 1,800) - 358,505 12 265,054 9 6(26) ( 76,438) ( 3) ( 48,398) ( 1) $ 282,067 9 $ 216,656 8 6(13) $ 2,369 - ($ 5,936) - 6(6)(18) 176,406 6 ( 48,718) ( 2) 6(26) ( 473) - 1,187 - 6(18) 22,506 1 ( 56,865) ( 2) $ 200,808 7 ($ 110,332) ( 4) $ 482,875 16 $ 106,324 4 $ 282,067 9 $ 216,656 8 $ 482,875 16 $ 106,324 4 6(27) $ 0.36 $ 0.27 $ 0.36 $ 0.27

4000 Operating revenue 5000 Operating costs 5900 Net operating margin Operating expenses 6100 Selling expenses 6200 General and administrative expenses 6300 Research and development expenses 6450 Gain on reversal of (expected credit losses) 6000 Total operating expenses 6900 Operating profit Non-operating income and expenses 7100 Interest income 7010 Other income 7020 Other gains and losses 7050 Finance costs 7000 Total non-operating income and expenses 7900 Profit before income tax 7950 Income tax expense 8200 Profit for the year Other comprehensive income Components of other comprehensive income (loss) that will not be reclassified to profit or loss 8311 Actuarial gains (losses) on defined benefit plans 8316 Unrealised gains (losses) from equity instruments measured at fair value through other comprehensive income 8349 Income tax related to components of other comprehensive income that will not be reclassified to profit or loss Components of other comprehensive income (loss) that will be reclassified to profit or loss 8361 Financial statements translation differences of foreign operations 8300 Total other comprehensive income (loss) for the year 8500 Total comprehensive income for the year Profit attributable to: 8610 Owners of the parent Comprehensive income attributable to: 8710 Owners of the parent Earnings per share (in dollars) 9750 Basic 9850 Diluted

The accompanying notes are an integral part of these consolidated financial statements.

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SCINOPHARM TAIWAN, LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY YEARS ENDED DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars)

Year ended December 31, 2019 Balance at January 1, 2019 Net income for the year ended December 31, 2019 Other comprehensive loss for the year ended December 31, 2019 Total comprehensive income (loss) for the year ended December 31, 2019 Distribution of 2018 net income: Legal reserve Cash dividends Employee stock option compensation cost Disposal of equity instruments at fair value through other comprehensive income Balance at December 31, 2019 Year ended December 31, 2020 Balance at January 1, 2020 Net income for the year ended December 31, 2020 Other comprehensive income for the year ended December 31, 2020 Total comprehensive income for the year ended December 31, 2020 Distribution of 2019 net income: Legal reserve Special reserve Cash dividends Employee stock option compensation cost Disposal of equity instruments at fair value through other comprehensive income Balance at December 31, 2020	Notes						Equity	at	tributable to owners of	the parent				Total equity
		S	hare capital - common stock		Capital reserve				Retained Earnings		Other EquityInterest
							Legal reserve		Special reserve	Unappropriated earnings	Financial statements translation differences of foreign operations	Unrealised gains (losses) from financial assets measured at fair value through other comprehensive income
	6(6)(18) 6(17) 6(15)(16) 6(6)(18) 6(6)(18) 6(17) 6(15)(16) 6(6)(18)		$ 7,907,392 - - - - - - - $ 7,907,392 $ 7,907,392 - - - - - - - - $ 7,907,392		$ 1,292,555 - - - - - 2,050 - $ 1,294,605 $ 1,294,605 - - - - - - 84 - $ 1,294,689		$ 568,302 - - - 44,298 - - - $ 612,600 $ 612,600 - - - 21,665 - - - - $ 634,265		$ 22,829 - - - - - - - $ 22,829 $ 22,829 - - - - 44,996 - - - $ 67,825	$ 708,338 216,656 ( 4,749 ) 211,907 ( 44,298 ) ( 387,462 ) - 1,859 $ 490,344 $ 490,344 282,067 1,896 283,963 ( 21,665 ) ( 44,996 ) ( 213,500 ) - 164,129 $ 658,275	($ 41,252 ) - ( 56,865 ) ( 56,865 ) - - - - ($ 98,117 ) ($ 98,117 ) - 22,506 22,506 - - - - - ($ 75,611 )	$ 80,868 - ( 48,718 ) ( 48,718 ) - - - ( 1,859 ) $ 30,291 $ 30,291 - 176,406 176,406 - - - - ( 164,129 ) $ 42,568	$ 10,539,032 216,656 ( 110,332 ) 106,324 - ( 387,462 ) 2,050 - $ 10,259,944 $ 10,259,944 282,067 200,808 482,875 - - ( 213,500 ) 84 - $ 10,529,403

The accompanying notes are an integral part of these consolidated financial statements.

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SCINOPHARM TAIWAN, LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars)

CASH FLOWS FROM OPERATING ACTIVITIES Profit before tax Adjustments Adjustments to reconcile profit (loss) Loss (gain) on valuation of financial assets and liabilities at fair value through profit or loss (Gain on reversal of) expected credit losses Reversal of allowance for inventory market price decline Provision for obsolescence of supplies Depreciation of property, plant and equipment Depreciation of right-of-use assets Property, plant and equipment transferred to loss Loss on disposal of property, plant and equipment (Gain on reversal of) impairment loss Amortisation Prepayments for equipment transferred to loss Employee stock option compensation cost Interest income Interest expense Changes in operating assets and liabilities Changes in operating assets Accounts receivable Other receivables Inventories Prepayments Changes in operating liabilities Contract liabilities - current Notes payable Accounts payable Other payables Net defined benefit liabilities - non-current Cash inflow generated from operations Interest received Interest paid Income tax paid Net cash flows from operating activities

Year ended December 31 Notes 2020 2019 $ 358,505 $ 265,054 5,092 ( 2,511 ) 12 ( 219 ) 214 6(5) ( 74,840 ) ( 51,413 ) 3,958 8,006 6(7)(24) 369,189 379,537 6(8)(24) 14,539 16,972 6(7)(22) 11,900 22,726 6(22) 3,157 39 6(7)(9)(22) ( 4,282 ) 707 6(24) 9,469 12,206 - 1,967 6(15)(16) 84 2,050 6(20) ( 27,408 ) ( 37,976 ) 6(23) 15,166 55,689 204,047 ( 31,599 ) ( 8,266 ) 33,791 ( 47,959 ) 293,845 19,724 ( 43,565 ) 10,861 25,368 ( 180 ) 205 58,653 11,625 18,047 ( 12,793 ) ( 581 ) ( 617 ) 938,656 949,527 29,367 37,057 ( 15,327 ) ( 63,570 ) ( 6,384 ) ( 134,069 ) 946,312 788,945

(Continued)

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SCINOPHARM TAIWAN, LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars)

CASH FLOWS FROM INVESTING ACTIVITIES Increase in financial assets at amortised cost - current Proceeds from disposal of financial assets at amortised cost - current Increase in other financial assets - current Proceeds from disposal of financial assets at fair value through other comprehensive income Cash paid for acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Acquisition of intangible assets Increase in prepayments for equipment Decrease (increase) in guarantee deposits paid Net cash flows from (used in) investing activities CASH FLOWS FROM FINANCING ACTIVITIES Decrease in short-term borrowings Repayment of the principal portion of lease liabilities Increase in long-term borrowings Decrease in long-term borrowings Increase (decrease) in guarantee deposits received Payment of cash dividends Net cash flows used in financing activities Effect of foreign exchange rate changes Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year

Year ended December 31 Notes 2020 2019 ($ 607,970 ) ($ 710,890 ) 779,230 717,940 ( 34,311 ) - 6(6) 283,501 4,189 6(28) ( 65,236 ) ( 21,351 ) 135 188 ( 3,128 ) ( 3,185 ) ( 114,732 ) ( 81,164 ) 4,231 ( 4,116 ) 241,720 ( 98,389 ) 6(29) ( 79,420 ) ( 140,356 ) 6(29) ( 9,772 ) ( 11,335 ) 6(29) 89,265 185,704 6(29) ( 232,695 ) ( 1,216,792 ) 6(29) 1,214 ( 1,618 ) 6(17) ( 213,500 ) ( 387,462 ) ( 444,908 ) ( 1,571,859 ) 6,846 ( 17,057 ) 749,970 ( 898,360 ) 6(1) 3,304,978 4,203,338 6(1) $ 4,054,948 $ 3,304,978

The accompanying notes are an integral part of these consolidated financial statements.

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SCINOPHARM TAIWAN, LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)

1. HISTORY AND ORGANISATION

• (1) ScinoPharm Taiwan, Ltd. (the Company) was incorporated as a company limited by shares under the provisions of the Company Act of the Republic of China (R.O.C.) on November 11, 1997. The Company and its subsidiaries (collectively referred herein as the “Group”) are primarily engaged in the manufacture of western medicines and other chemical materials, biological technology services, intellectual property rights, international trade and research, development and manufacture of Active Pharmaceutical Ingredients (“API”), albumin medicines, oligonucleotide medicines, peptide medicines, injections and new small molecule drugs, as well as the provision of related consulting and technical services.

• (2) The common shares of the Company have been listed on the Taiwan Stock Exchange since September 2011.

• (3) Uni-President Enterprises Corp., the Company’s ultimate parent company, holds 37.94% equity interest in the Company.

2. THE DATE OF AUTHORISATION FOR ISSUANCE OF THE CONSOLIDATED FINANCIAL

STATEMENTS AND PROCEDURES FOR AUTHORISATION

• These consolidated financial statements were authorised for issuance by the Board of Directors on March 18, 2021.

• APPLICATION OF NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS (1) Effect of the adoption of new issuances of or amendments to International Financial Reporting Standards (“IFRS”) as endorsed by the Financial Supervisory Commission (“FSC”)

New standards, interpretations and amendments endorsed by the FSC effective from 2020 are as follows:

New Standards,Interpretations andAmendments	Effective date by International Accounting StandardsBoard ("IASB")
Amendments to IAS 1 and IAS 8, ‘Disclosure initiative - definition of material’ Amendments to IFRS 3, ‘Definition of a business’ Amendments to IFRS 9, IAS 39 and IFRS 7 ,‘Interest rate benchmark reform’ Amendment to IFRS 16, ‘Covid-19 - related rent concessions’ Note: Earlier application from January 1, 2020 is allowed by the FSC.	January 1, 2020 January 1, 2020 January 1, 2020 June 1, 2020 (Note)

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The above standards and interpretations have no significant impact to the Group’s financial condition and financial performance based on the Group’s assessment.

(2) Effect of new issuances of or amendments to IFRSs as endorsed by the FSC but not yet adopted by the Group

New standards, interpretations and amendments endorsed by the FSC effective from 2021 are as follows:

follows:
New Standards,Interpretations andAmendments	Effective date by IASB
Amendments to IFRS 4, ‘Extension of the temporary exemption from applying IFRS 9’ Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16, ‘Interest Rate Benchmark Reform-Phase 2’	January 1, 2021 January 1, 2021

The above standards and interpretations have no significant impact to the Group’s financial condition and financial performance based on the Group’s assessment.

(3) IFRSs issued by IASB but not yet endorsed by the FSC

New standards, interpretations and amendments issued by IASB but not yet included in the IFRSs as endorsed by the FSC are as follows:

endorsed by the FSC are as follows:
New Standards,Interpretations and Amendments	Effective date by IASB
Amendments to IFRS 3, ‘Reference to the conceptual framework’ Amendments to IFRS 10 and IAS 28, ‘Sale or contribution of assets between an investor and its associate or joint venture’ IFRS 17, ‘Insurance contracts’ Amendments to IFRS 17, ‘Insurance contracts’ Amendments to IAS 1, ‘Classification of liabilities as current or non- current’ Amendments to IAS 1, ‘Disclosure of accounting policies’ Amendments to IAS 8, ‘Definition of accounting estimates’ Amendments to IAS 16, ‘Property, plant and equipment: proceeds before intended use’ Amendments to IAS 37, ‘Onerous contracts - cost of fulfilling a contract’ Annual improvements to IFRS Standards 2018–2020	January 1, 2022 To be determined by IASB January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2022 January 1, 2022 January 1, 2022

The above standards and interpretations have no significant impact to the Group’s financial condition and financial performance based on the Group’s assessment.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of these consolidated financial statements

are set out below. These policies have been consistently applied to all the periods presented, unless otherwise stated.

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(1) Compliance statement

The consolidated financial statements of the Group have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretation as endorsed by the FSC (collectively referred herein as the “IFRSs”).

(2) Basis of preparation

• A. Except for the following items, these consolidated financial statements have been prepared under the historical cost convention:

• (a) Financial assets and financial liabilities (including derivative instruments) at fair value through profit or loss.

• (b) Financial assets at fair value through other comprehensive income.

• (c) Defined benefit liabilities recognised based on the net amount of pension fund assets less present value of defined benefit obligation.

• B. The preparation of financial statements in conformity with IFRSs requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 5.

(3) Basis of consolidation

• A. Basis for preparation of consolidated financial statements:

• (a) All subsidiaries are included in the Group’s consolidated financial statements. Subsidiaries are all entities (including structured entities) controlled by the Group. The Group controls an entity when the Group is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Consolidation of subsidiaries begins from the date the Group obtains control of the subsidiaries and ceases when the Group loses control of the subsidiaries.

• (b) Inter-company transactions, balances and unrealised gains or losses on transactions between companies within the Group are eliminated. Accounting policies of subsidiaries have been adjusted where necessary to ensure consistency with the policies adopted by the Group.

• (c) Profit or loss and each component of other comprehensive income are attributed to the owners of the parent and to the non-controlling interests. Total comprehensive income is attributed to the owners of the parent and to the non-controlling interests even if this results in the noncontrolling interests having a deficit balance.

• (d) Changes in a parent’s ownership interest in a subsidiary that do not result in the parent losing control of the subsidiary (transactions with non-controlling interests) are accounted for as equity transactions, i.e. transactions with owners in their capacity as owners. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognised directly in equity.

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• (e) When the Group loses control of a subsidiary, the Group remeasures any investment retained in the former subsidiary at its fair value. That fair value is regarded as the fair value on initial recognition of a financial asset or the cost on initial recognition of the associate or joint venture. Any difference between fair value and carrying amount is recognised in profit or loss. All amounts previously recognised in other comprehensive income in relation to the subsidiary are reclassified to profit or loss on the same basis as would be required if the related assets or liabilities were disposed of. That is, when the Group loses control of a subsidiary, all gains or losses previously recognised in other comprehensive income in relation to the subsidiary should be reclassified from equity to profit or loss, if such gains or losses would be reclassified to profit or loss when the related assets or liabilities are disposed of.

• B. Subsidiaries included in the consolidated financial statements:

Name of Investors	Name of Subsidiaries	Business activities Professional investment Professional investment Research, development and manufacture of API and new drugs, etc. Research, development and manufacture of API and new drugs, sale of self-produced products, etc. Import, export and sales of API and intermediates, etc.	December 31, December 31, 2020 2019 100.00 100.00 100.00 100.00 - 100.00 100.00 100.00 100.00 100.00 Percentage owned by the Company	Note
			December 31, 2020 100.00 100.00 - 100.00 100.00
ScinoPharm Taiwan, Ltd. ScinoPharm Taiwan, Ltd. SPT International, Ltd. SPT International, Ltd. SPT International, Ltd.	SPT International, Ltd. ScinoPharm Singapore Pte Ltd. SciAnda (Kunshan) Biochemical Technology Ltd. SciAnda (Changshu) Pharmaceuticals, Ltd. SciAnda Shanghai Biochemical Technology, Ltd.			(Note) (Note)

Note: In order to integrate the Group’s resources and improve management efficiency, on November 1, 2019, the Company’s Board of Directors has resolved to conduct an organisational restructuring through the short form merger of SciAnda (Changshu)

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Pharmaceuticals, Ltd. and SciAnda (Kunshan) Biochemical Technology, Ltd., with SciAnda (Changshu) Pharmaceuticals, Ltd. as the surviving company, and SciAnda (Kunshan) Biochemical Technology, Ltd. as the dissolved company. The registration was approved by the competent authority on August 18, 2020.

• C. Subsidiaries not included in the consolidated financial statements: None.

• D. Adjustments for subsidiaries with different balance sheet dates: None.

• E. Significant restrictions: None.

• F. Subsidiaries that have non-controlling interests that are material to the Group: None.

• (4) Foreign currency translation

Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (the “functional currency”). The consolidated financial statements are presented in NTD, which is the Company’s functional and the Group’s presentation currency.

• A. Foreign currency transactions and balances

• (a) Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where items are remeasured. Foreign exchange gains and losses resulting from the settlement of such transactions are recognised in profit or loss in the period in which they arise.

• (b) Monetary assets and liabilities denominated in foreign currencies at the period end are retranslated at the exchange rates prevailing at the balance sheet date. Exchange differences arising upon re-translation at the balance sheet date are recognised in profit or loss.

• (c) Non-monetary assets and liabilities denominated in foreign currencies held at fair value through profit or loss are re-translated at the exchange rates prevailing at the balance sheet date; their translation differences are recognised in profit or loss. Non-monetary assets and liabilities denominated in foreign currencies held at fair value through other comprehensive income are re-translated at the exchange rates prevailing at the balance sheet date; their translation differences are recognised in other comprehensive income. However, nonmonetary assets and liabilities denominated in foreign currencies that are not measured at fair value are translated using the historical exchange rates at the dates of the initial transactions.

• (d) All other foreign exchange gains and losses are presented in the statement of comprehensive income within “other gains and losses”.

• B. Translation of foreign operations

• (a) The operating results and financial position of all the group entities, associates and joint arrangements that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

  • i. Assets and liabilities for each balance sheet presented are translated at the closing exchange rate at the date of that balance sheet;

  • ii. Income and expenses for each statement of comprehensive income are translated at average

~19~

exchange rates of that period; and

iii. All resulting exchange differences are recognised in other comprehensive income.

  - (b) When the foreign operation partially disposed of or sold is a subsidiary, cumulative exchange differences that were recorded in other comprehensive income are proportionately transferred to the non-controlling interest in this foreign operation. In addition, if the Group retains partial interest in the former foreign subsidiary after losing control of the former foreign subsidiary, such transactions should be accounted for as disposal of all interest in the foreign operation.

• (5) Classification of current and non-current items

• A. Assets that meet one of the following criteria are classified as current assets; otherwise they are classified as non-current assets:

  • (a) Assets arising from operating activities that are expected to be realised, or are intended to be sold or consumed within the normal operating cycle;

  • (b) Assets held mainly for trading purposes;

  • (c) Assets that are expected to be realised within twelve months from the balance sheet date;

  • (d) Cash and cash equivalents, excluding restricted cash and cash equivalents and those that are to be exchanged or used to pay off liabilities more than twelve months after the balance sheet date.

• B. Liabilities that meet one of the following criteria are classified as current liabilities; otherwise they are classified as non-current liabilities:

  • (a) Liabilities that are expected to be paid off within the normal operating cycle;

  • (b) Liabilities arising mainly from trading activities;

  • (c) Liabilities that are to be paid off within twelve months from the balance sheet date;

  • (d) Liabilities for which the repayment date cannot be extended unconditionally to more than twelve months after the balance sheet date. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

(6) Cash equivalents

• A. Cash equivalents refer to short-term highly liquid investments that are readily convertible to known amount of cash and subject to an insignificant risk of changes in value.

• B. Time deposits and bills under repurchase agreements that meet the above criteria and are held for the purpose of meeting short-term cash commitment in operations are classified as cash equivalents.

(7) Financial assets at fair value through profit or loss

• A. Financial assets at fair value through profit or loss are financial assets that are not measured at amortised cost or fair value through other comprehensive income.

• B. On a regular way purchase or sale basis, financial assets at fair value through profit or loss are recognised and derecognised using trade date accounting.

• C. At initial recognition, the Group measures the financial assets at fair value and recognises the

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transaction costs in profit or loss. The Group subsequently measures the financial assets at fair value, and recognises the gain or loss in profit or loss.

• D. The Group recognises the dividend income when the right to receive payment is established, future economic benefits associated with the dividend will flow to the Group and the amount of the dividend can be measured reliably.

• (8) Financial assets at fair value through other comprehensive income

• A. Financial assets at fair value through other comprehensive income comprise equity securities which are not held for trading, and for which the Group has made an irrevocable election at initial recognition to recognise changes in fair value in other comprehensive income.

• B. On a regular way purchase or sale basis, financial assets at fair value through other comprehensive income are recognised and derecognised using trade date accounting.

• C. At initial recognition, the Group measures the financial assets at fair value plus transaction costs. The Group subsequently measures the financial assets at fair value. The changes in fair value of equity investments that were recognised in other comprehensive income are reclassified to retained earnings and are not reclassified to profit or loss following the derecognition of the investment. Dividends are recognised as revenue when the right to receive payment is established, future economic benefits associated with the dividend will flow to the Group and the amount of the dividend can be measured reliably.

• (9) Financial assets at amortised cost

• A. Financial assets at amortised cost are those that meet all of the following criteria:

• (a) The objective of the Group’s business model is achieved by collecting contractual cash flows.

• (b) The assets’ contractual cash flows represent solely payments of principal and interest.

• B. On a regular way purchase or sale basis, financial assets at amortised cost are recognised and derecognised using trade date accounting.

• C. At initial recognition, the Group measures the financial assets at fair value plus transaction costs. Interest income from these financial assets is included in finance income using the effective interest method. A gain or loss is recognised in profit or loss when the asset is derecognised or impaired.

• D. The Group’s structured deposits which do not fall under cash equivalents are those with a short maturity period and are measured at initial investment amount as the effect of discounting is immaterial. Time deposits pledged to others as collateral conform to financial assets at amortised cost definition, and were classified as other financial assets.

• (10) Accounts and notes receivable

• A. Accounts and notes receivable entitle the Group a legal right to receive consideration in exchange for transferred goods or rendered services.

• B. The short-term accounts and notes receivable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.

~21~

(11) Impairment of financial assets

For financial assets at amortised cost, at each reporting date, the Group recognises the impairment provision for 12 months expected credit losses if there has not been a significant increase in credit risk since initial recognition or recognises the impairment provision for the lifetime expected credit losses (ECLs) if such credit risk has increased since initial recognition after taking into consideration all reasonable and verifiable information that includes forecasts. On the other hand, for accounts receivable or contract assets that do not contain a significant financing component, the Group recognises the impairment provision for lifetime ECLs.

(12) Derecognition of financial assets

The Group derecognises a financial asset when the contractual rights to cash flows from the financial asset expire.

(13) Inventories

The standard cost method is applied, and cost is determined using the weighted-average cost method. The cost of finished goods and work in process comprises raw materials, direct labor, other direct costs and related production overheads (allocated based on normal operating capacity). It excludes borrowing costs. The item by item approach is used in applying the lower of cost and net realisable value. Net realisable value is the estimated selling price in the ordinary course of business, less the estimated cost of completion and applicable variable selling expenses. When the cost of inventories exceeds the realisable value, the amount of any write-down of inventories is recognised as cost of sales during the period and the amount of any reversal of inventory write-down is recognised as a reduction in the cost sales during the period.

(14) Property, plant and equipment

• A. Property, plant and equipment are initially recorded at cost. Borrowing costs incurred during the construction period are capitalised.

• B. Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to profit or loss during the financial period in which they are incurred.

• C. Except for land, other property, plant and equipment apply cost model and are depreciated using the straight-line method to allocate their cost over their estimated useful lives. If each component of property, plant and equipment is significant, it is depreciated separately.

~22~

• D. The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each financial year-end date. If expectations for the assets’ residual values and useful lives differ from previous estimates or the patterns of consumption of the assets’ future economic benefits embodied in the assets have changed significantly, any change is accounted for as a change in estimate under IAS 8, ‘Accounting Policies, Changes in Accounting Estimates and Errors’, from the date of the change. The estimated useful lives of property, plant and equipment are as follows:

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Assets Estimated useful lives
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Assets	Est	imate	d use	ful lives
Buildings and structures	2	～	35	years
Machinery and equipment	2	～	12	years
Transportation equipment	2	～	5	years
Office equipment	2	～	9	years
Other equipment	2	～	19	years

(15) Intangible assets

Professional skills and computer software, etc. are stated at cost and amortised on a straight-line basis over their estimated useful lives of 3 ~ 5 years.

(16) Leasing arrangements (lessee) － right-of-use assets/ lease liabilities

• A. Leases are recognised as a right-of-use asset and a corresponding lease liability at the date at which the leased asset is available for use by the Group. For short-term leases or leases of lowvalue assets, lease payments are recognised as an expense on a straight-line basis over the lease term.

• B. Lease liabilities include the net present value of the remaining lease payments at the commencement date, discounted using the incremental borrowing interest rate. Lease payments are fixed payments less any lease incentives receivable. The Group subsequently measures the lease liabilities at amortised cost using the interest method and recognises interest expense over the lease term. The lease liability is remeasured and the amount of remeasurement is recognised as an adjustment to the right-of-use asset when there are changes in the lease term or lease payments and such changes do not arise from contract modifications.

• C. At the commencement date, the right-of-use asset is stated at cost under the amount of the initial measurement of lease liability. The right-of-use asset is measured subsequently using the cost model and is depreciated from the commencement date to the earlier of the end of the asset’s useful life or the end of the lease term. When the lease liability is remeasured, the amount of remeasurement is recognised as an adjustment to the right-of-use asset.

• D. For lease modifications that decrease the scope of the lease, the lessee shall decrease the carrying amount of right-of use assets to reflect the partial or full termination of the lease, and recognise the difference between remeasured lease liability in profit or loss.

~23~

(17) Impairment of non-financial assets

• The Group assesses at each balance sheet date the recoverable amounts of those assets where there is an indication that they are impaired. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell or value in use. When the circumstances or reasons for recognising impairment loss for an asset in prior years no longer exist or diminish, the impairment loss shall be reversed to the extent of the loss previously recognised in profit or loss. The increased carrying amount due to reversal should not be more than what the depreciated or amortised historical cost would have been if the impairment had not been recognised.

• (18) Borrowings

• Borrowings comprise long-term and short-term bank borrowings. Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in profit or loss over the period of the borrowings using the effective interest method.

(19) Financial liabilities at fair value through profit or loss

• A. Financial liabilities are classified in this category of held for trading if acquired principally for the purpose of repurchasing in the short-term. Derivatives are also categorised as financial liabilities held for trading unless they are designated as hedges or financial liabilities at fair value through profit or loss. Financial liabilities that meet one of the following criteria are designated as at fair value through profit or loss at initial recognition:

  • (a) Hybrid (combined) contracts; or

  • (b) They eliminate or significantly reduce a measurement or recognition inconsistency; or

  • (c) They are managed and their performance is evaluated on a fair value basis, in accordance with a documented risk management policy.

• B. At initial recognition, the Group measures the financial liabilities at fair value. All related transaction costs are recognised in profit or loss. The Group subsequently measures these financial liabilities at fair value with any gain or loss recognised in profit or loss.

• (20) Notes and accounts payable

• A. Accounts payable are liabilities for purchases of raw materials, goods or services and notes payable are those resulting from operating and non-operating activities.

• B. The short-term notes and accounts payable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.

(21) Derecognition of financial liabilities

• A financial liability is derecognised when the obligation under the liability specified in the contract is discharged, cancelled or expires.

~24~

(22) Offsetting financial instruments

Financial assets and liabilities are offset and reported in the net amount in the balance sheet when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously.

(23) Employee benefits

• A. Short-term employee benefits

Short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in respect of service rendered by employees in a period and should be recognised as expenses in that period when the employees render service.

• B. Pensions

• (a) Defined contribution plans

For defined contribution plans, the contributions are recognised as pension expenses when they are due on an accrual basis. Prepaid contributions are recognised as an asset to the extent of a cash refund or a reduction in the future payments.

• (b) Defined benefit plans

  • i. Net obligation under a defined benefit plan is defined as the present value of an amount of pension benefits that employees will receive on retirement for their services with the Group in current period or prior periods. The liability recognised in the balance sheet in respect of defined benefit pension plans is the present value of the defined benefit obligation at the balance sheet date less the fair value of plan assets. The net defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method. The rate used to discount is determined by using interest of government bonds (at the balance sheet date) of a currency and term consistent with the currency and term of the employment benefit obligations.

  • ii.Remeasurements arising on defined benefit plans are recognised in other comprehensive income in the period in which they arise, and recorded as retained earnings.

• C. Employees’ compensation and directors’ remuneration

• Employees’ compensation and directors’ remuneration are recognised as expenses and liabilities, provided that such recognition is required under legal or constructive obligation and those amounts can be reliably estimated. Any difference between the resolved amounts and the subsequently actual distributed amounts is accounted for as changes in estimates. If employees’ compensation is distributed by shares, the Group calculates the number of shares based on the closing market price at the previous day of the board meeting resolution.

~25~

- (24) Employee share based payment

• For the equity-settled share-based payment arrangements, the employee services received are measured at the fair value of the equity instruments granted at the grant date, and are recognised as compensation cost over the vesting period, with a corresponding adjustment to equity. The fair value of the equity instruments granted shall reflect the impact of market vesting conditions and nonmarket vesting conditions. Compensation cost is subject to adjustment based on the service conditions that are expected to be satisfied and the estimates of the number of equity instruments that are expected to vest under the non-market vesting conditions at each balance sheet date. Ultimately, the amount of compensation cost recognised is based on the number of equity instruments that eventually vest.

(25) Income tax

• A. The tax expense for the period comprises current and deferred tax. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or items recognised directly in equity, in which cases the tax is recognised in other comprehensive income or equity.

• B. The current income tax expense is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where the Group operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in accordance with applicable tax regulations. It establishes provisions where appropriate based on the amounts expected to be paid to the tax authorities. An additional tax is levied on the unappropriated retained earnings and is recorded as income tax expense in the year the stockholders resolve to retain the earnings.

• C. Deferred income tax is recognised, using the balance sheet liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, the deferred income tax is not accounted for if it arises from initial recognition of goodwill or of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is provided on temporary differences arising on investments in subsidiaries except where the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.

• D. Deferred income tax assets are recognised only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilized. At each balance sheet date, unrecognised and recognised deferred income tax assets are reassessed.

~26~

• E. Current income tax assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously. Deferred tax assets and liabilities are offset on the balance sheet when the entity has the legally enforceable right to offset current tax assets against current tax liabilities and they are levied by the same taxation authority on either the same entity or different entities that intend to settle on a net basis or realise the asset and settle the liability simultaneously.

• (26) Share capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or stock options are shown in equity as a deduction, net of tax, from the proceeds.

• (27) Dividends

• Dividends are recorded in the Company’s financial statements in the period in which they are resolved by the Company’s shareholders. Cash dividends are recorded as liabilities; stock dividends are recorded as stock dividends to be distributed and are reclassified to ordinary shares on the effective date of new shares issuance.

• (28) Revenue recognition

• A. Sales of goods

  • (a) The Group manufactures and sells API, intermediates, etc. Sales are recognised when control of the products has transferred, and there is no unfulfilled obligation that could affect the customer’s acceptance of the products. Delivery occurs when the products have been shipped to the specific location, the risks of obsolescence and loss have been transferred to the customer, and either the customer has accepted the products in accordance with the sales contract, or the Group has objective evidence that all criteria for acceptance have been satisfied.

  • (b) Revenue is recognised based on the price specified in the contract, net of the sales returns and discounts. Accumulated experience is used to estimate and provide for the sales returns and discounts, using the expected value method, and revenue is only recognised to the extent that it is highly probable that a significant reversal will not occur. The estimation is subject to an assessment at each reporting date. As the time interval between the transfer of committed goods or service and the payment of customer does not exceed one year, the Group does not adjust the transaction price to reflect the time value of money.

  • (c) A receivable is recognised when the goods are delivered as this is the point in time that the consideration is unconditional because only the passage of time is required before the payment is due.

~27~

B. Sales of services

• (a) The Group provides technology development and consultation services. Revenue from providing services is recognised in the accounting period in which the services are rendered. For fixed-price contracts, revenue is recognised based on the service rendered up to the end of the reporting period as a proportion of the total services to be provided. The customer pays at the time specified in the payment schedule. If the services rendered exceed the payment, a contract asset is recognised. If the payments exceed the services rendered, a contract liability is recognised.

• (b) The Group’s estimate about revenue, costs and progress towards complete satisfaction of a performance obligation is subject to a revision whenever there is a change in circumstances. Any increase or decrease in revenue or costs due to an estimate revision is reflected in profit or loss during the period when the management becomes aware of the changes in circumstances.

• C. Incremental costs of obtaining a contract

• Given that the contractual period lasts less than one year, the Group recognises the incremental costs (mainly comprised of sales commissions) of obtaining a contract as an expense when incurred although the Group expects to recover those costs.

(29) Government grants

Government grants are recognised at their fair value only when there is reasonable assurance that the Group will comply with any conditions attached to the grants and the grants will be received. Government grants are recognised in profit or loss on a systematic basis over the periods in which the Group recognises expenses for the related costs for which the grants are intended to compensate.

• (30) Operating segments

Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision-Maker. The Chief Operating Decision-Maker is responsible for allocating resources and assessing performance of the operating segments.

1. CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND KEY SOURCES OF ASSUMPTION UNCERTAINTY

The preparation of these consolidated financial statements requires management to make critical judgements in applying the Group’s accounting policies and make critical assumptions and estimates concerning future events. Assumptions and estimates may differ from the actual results and are continually evaluated and adjusted based on historical experience and other factors. Such assumptions and estimates have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, and the related information is addressed below:

(1) Critical judgments in applying the Group’s accounting policies

None.

~28~

(2) Critical accounting estimates and assumptions

• A. Evaluation of inventories

• (a) As inventories are stated at the lower of cost and net realisable value, the Group must determine the net realisable value of inventories on balance sheet date using judgements and estimates. As the manufacturing process is relatively complicated and time consuming, materials require longer lead time, the waiting period for product registration is long, and the timing of product launch may be deferred, the Group evaluates the amounts of normal inventory consumption, obsolete inventories or inventories without market selling value on balance sheet date, and writes down the cost of inventories to the net realisable value. Since the calculation of net realisable value involves subjective judgement and the ending balance of inventory is material to the financial statements, there might be material changes to the evaluation.

• (b) As of December 31, 2020, the carrying amount of inventories was $1,245,870.

• B. Realisability of deferred income tax assets

• (a) Deferred income tax assets are recognised only to the extent that it is probable that future taxable profit will be available against which the deductible temporary differences can be utilized. Assessment of the realisability of deferred income tax assets involves critical accounting judgments and estimates of the management, including the assumptions of expected future sales revenue growth rate and profit rate, tax exempt duration, available tax credits, tax planning, etc. Any variations in global economic environment, industrial environment, and laws and regulations might cause material adjustments to deferred income tax assets.

• (b) As of December 31, 2020, the Group recognised deferred income tax assets amounting to $602,979.

6. DETAILS OF SIGNIFICANT ACCOUNTS

(1) CASH AND CASH EQUIVALENTS

$602,979. TAILS OF SIGNIFICANT ACCOUNTS CASH AND CASH EQUIVALENTS
Cash: Cash on hand Checking accounts and demand deposits Cash equivalents: Time deposits Bills under repurchase agreements	December31,2020 149 $ 231,402 231,551 3,593,500 229,897 3,823,397 4,054,948 $	December31,2019
		159 $ 414,571
		414,730
		2,620,500 269,748
		2,890,248
		3,304,978 $

• A. The Group transacts with a variety of financial institutions all with high credit quality to disperse credit risk, so it expects that the probability of counterparty default is remote.

~29~

• B. Details of the Group’s time deposits pledged to others as collateral (listed as “Other financial assets - non-current”) as of December 31, 2020 and 2019 are provided in Notes 8 and 9.

• C. Part of the Group’s bank deposits (listed as “Other Financial Assets - Current”) are subject to provisional attachment due to the contract disputes. Please refer to Note 8 for details.

• (2) FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS

Items		December31,2020	December31,2020		December31,2019	December31,2019
Current items:
Financial assets (liabilities) mandatorily
measured at fair value through profit
or loss
Derivatives	($		2,172)		$	2,920
Non-current items:
Financial assets mandatorily measured
at fair value through profit or loss
Unlisted stocks		$	4,620		$	4,620
Valuation adjustment	(		4,620)	(		4,620)
		$	-		$	-

• A. The Group recognised net gain (loss) of $2,295 and ($2,552) on financial assets at fair value through profit or loss (listed as “ Other gains and losses”) for the years ended December 31, 2020 and 2019, respectively.

• B. The Group entered into contracts relating to derivative financial liabilities which were not accounted for under hedge accounting. The information is listed below (Units in thousands of currencies indicated):

accounted for under hedge accounting. The information is currencies indicated):	listed below (Units in thousands of	listed below (Units in thousands of
Items Forward foreign exchange contracts Items Forward foreign exchange contracts	December31,2020
	Contract amount Contractperiod USD 11,545 11.2020~4.2021 December31,2019	Contractperiod
	Contract amount USD 13,553	Contract period
		10.2019~3.2020

The Group entered into forward foreign exchange contracts to hedge exchange rate risk of operating activities. However, these forward foreign exchange contracts are not accounted for under hedge accounting.

• C. The Group has no financial assets at fair value through profit or loss pledged to others as of December 31, 2020 and 2019.

(3) FINANCIAL ASSETS AT AMORTISED COST - CURRENT

Items Structured deposits	December31,2020 - $	December31,2019
		172,220 $

~30~

• A. The Group entered into structured deposits, which are guaranteed yield financial products, with financial institutions.

• B. The Group recognised interest income of $3,054 and $7,317 from financial assets at amortised cost for the years ended December 31, 2020 and 2019, respectively.

• C. The Group has no financial assets at amortised cost pledged to others as of December 31, 2020 and 2019.

• D. Information relating to credit risk of financial assets at amortised cost is provided in Note 12(2).

(4) ACCOUNTS RECEIVABLE, NET

ACCOUNTS RECEIVABLE, NET
		December	31,2020		December	31,2019
Accounts receivable		$	386,547		$	590,594
Less: Loss allowance	(		39)	(		258)
		$	386,508		$	590,336
A. The ageing analysis of accounts receivable is as follows:
		December	31,2020		December	31,2019
Not past due		$	348,817		$	456,776
Less than 30 days			29,608			82,787
Between 31 to 90 days			8,122			51,031
		$	386,547		$	590,594

The above ageing analysis is based on past due date.

• B. As of December 31, 2020 and 2019, accounts receivable arose from contracts with customers. As

• of January 1, 2019, the balance of receivables from contracts with customers amounted to $558,995.

• C. As of December 31, 2020 and 2019, the Group does not hold any collateral as security.

• D. As of December 31, 2020 and 2019, without taking into account any collateral held or other credit enhancements, the maximum exposure to credit risk in respect of the amount that best represents the Group’s accounts receivable is the book value.

• E. Information relating to credit risk of accounts receivable is provided in Note 12(2).

~31~

(5) INVENTORIES

Raw materials Supplies Work in process Finished goods Raw materials Supplies Work in process Finished goods

Allowance for Cost marketprice decline Bookvalue 409,019 $ 60,492) ($ 348,527 $ 33,636 3,740) ( 29,896 422,813 94,898) ( 327,915 777,941 238,409) ( 539,532 1,643,409 $ 397,539) ($ 1,245,870 $ Allowance for Cost market price decline Book value 330,368 $ 62,829) ($ 267,539 $ 29,009 3,347) ( 25,662 355,393 77,847) ( 277,546 880,680 327,095) ( 553,585 1,595,450 $ 471,118) ($ 1,124,332 $ December31,2020 December31,2019

The Group recognised expense and loss of inventories for the year:

			For the years ended	For the years ended	For the years ended	December 31,
			2020			2019
Cost of goods sold		$	1,506,769		$	1,337,537
Loss on physical inventory			519			3,170
Loss on inventory scrap			43,817			25,263
Under applied manufacturing overhead			246,428			319,876
Reversal of allowance for inventory
market price decline (Note)	(		74,840)	(		51,413)
Revenue from sale of scraps	(		1,773)	(		8,472)
Total cost of goods sold		$	1,720,920		$	1,625,961

Note: The Group reversed a previous inventory write-down which was accounted for as reduction of cost of goods sold because certain inventory which were previously provided with allowance were again utilised in the research and development project or in production for the years ended December 31, 2020 and 2019, respectively.

~32~

(6) FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME - NON-CURRENT

NON-CURRENT
Items December31,2020 Equity instruments Listed stocks 97,874 $ Unlisted stocks 167,673 265,547 Valuation adjustment 42,568 308,115 $	December31,2019
	217,246 $ 167,673 384,919 30,291
	415,210 $

• A. The Group has elected to classify investments that are considered to be strategic investments as financial assets at fair value through other comprehensive income. The fair value of such investments is the book value as of December 31, 2020 and 2019.

• B. Due to the change in investment strategies, the Group sold $283,501 and $4,189 of equity instruments at fair value resulting in cumulative gain on disposal of $164,129 and $1,859 which was reclassified to retained earnings during the years ended December 31, 2020 and 2019, respectively.

• C. Amounts recognised in other comprehensive income in relation to the financial assets at fair value through other comprehensive income are listed below:

Equity instruments at fair value through other		Forthe years ended	Forthe years ended	December31,
comprehensive income		2020		2019
Fair value change recognised in other
comprehensive income	$	176,406	($	48,718)
Cumulative gains reclassified to
retained earnings due to derecognition	($	164,129)	($	1,859)

• D. The Group has no financial assets at fair value through other comprehensive income pledged to others as of December 31, 2020 and 2019.

~33~

(7) PROPERTY, PLANT AND EQUIPMENT

Machinery and Transportation Office Other January 1, 2020 Buildings equipment equipment equipment equipment Cost 3,495,743 $ 5,186,449 $ 25,505 $ 229,037 $ 147,692 $ Accumulated depreciation 1,243,381) ( 4,080,498) ( 24,412) ( 186,532) ( 120,138) ( Accumulated impairment - 9,284) ( - 15) ( 14) ( 2,252,362 $ 1,096,667 $ 1,093 $ 42,490 $ 27,540 $ At January 1 2,252,362 $ 1,096,667 $ 1,093 $ 42,490 $ 27,540 $ Additions - 4,488 - 142 - Reclassified from prepayments for equipment - - - - - Reclassified upon completion 9,410 65,231 204 12,568 339 Transferred to intangible assets - - - - - Transferred to loss (Note 1) - - - - - Depreciation charge 143,428) ( 204,658) ( 218) ( 15,469) ( 5,416) ( Disposals－Cost 736) ( 58,774) ( 1,475) ( 18,792) ( 435) ( ' －Accumulated depreciation 251 56,063 1,475 18,739 392 Reversal of impairment loss - 4,253 - 15 14 Net currency exchange differences 10,182 4,215 9 103 251 At December 31 2,128,041 $ 967,485 $ 1,088 $ 39,796 $ 22,685 $ December 31, 2020 Cost 3,517,543 $ 5,205,877 $ 24,323 $ 223,747 $ 149,523 $ Accumulated depreciation 1,389,502) ( 4,233,361) ( 23,235) ( 183,951) ( 126,838) ( Accumulated impairment - 5,031) ( - - - 2,128,041 $ 967,485 $ 1,088 $ 39,796 $ 22,685 $ For the year ended December 31, 2020

~34~

														Construction
													in progress and
													equipment before
				Machinery and		Transportation			Office		Other			acceptance
January 1, 2019		Buildings			equipment		equipment		equipment		equipment			inspection		Total
Cost	$	3,521,175	$		5,147,057	$	26,668	$	219,135	$	152,211	$		1,056,179	$	10,122,425
Accumulated depreciation	(	1,103,014)	(		3,922,795)	(	24,393)	(	186,675)	(	118,076)			-	(	5,354,953)
Accumulated impairment		-	(		8,577)		-	(	34)	(	15)			-	(	8,626)
	$	2,418,161	$		1,215,685	$	2,275	$	32,426	$	34,120	$		1,056,179	$	4,758,846
For the year ended December 31, 2019
At January 1	$	2,418,161	$		1,215,685	$	2,275	$	32,426	$	34,120	$		1,056,179	$	4,758,846
Additions		1,421			3,029		-		907		-			22,725		28,082
Reclassified from prepayments
for equipment		-			-		-		-		-			102,546		102,546
Reclassified upon completion		9,629			104,201		-		23,795		872	(		138,497)		-
Transferred to intangible assets		-			-		-		-		-	(		6,500)	(	6,500)
Transferred to loss (Note 2)		-			-		-		-		-	(		22,726)	(	22,726)
Depreciation charge	(	146,639)	(		211,033)	(	1,065)	(	14,297)	(	6,503)			-	(	379,537)
Disposals－Cost	(	161)	(		44,398)	(	918)	(	12,641)	(	53)			-	(	58,171)
' －Accumulated depreciation		48			44,398		826		12,606		48			-		57,926
' －Accumulated impairment		-			-		-		18		-			-		18
Reversal of impairment loss		-	(		707)		-		-		-			-	(	707)
Net currency exchange differences	(	30,097)	(		14,508)	(	25)	(	324)	(	944)	(		19)	(	45,917)
At December 31	$	2,252,362	$		1,096,667	$	1,093	$	42,490	$	27,540	$		1,013,708	$	4,433,860
December 31, 2019
Cost	$	3,495,743	$		5,186,449	$	25,505	$	229,037	$	147,692	$		1,013,708	$	10,098,134
Accumulated depreciation	(	1,243,381)	(		4,080,498)	(	24,412)	(	186,532)	(	120,138)			-	(	5,654,961)
Accumulated impairment		-	(		9,284)		-	(	15)	(	14)			-	(	9,313)
	$	2,252,362	$		1,096,667	$	1,093	$	42,490	$	27,540	$		1,013,708	$	4,433,860

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• Note 1: The Group’s custom-made software module did not function as expected and meet the Company’s end use during the development process. After internal discussion, the Company has decided to write off the unfinished software, and recognised the costs incurred as losses.

• Note 2: The Group did not accept the customized equipment ordered from the vendor as its format and efficiency did not meet expectations. In April 2019, the two sides reached a consensus. The vendor refunded and terminated the purchase of equipment and the Group will transfer the balance of the related construction in progress and equipment before acceptance inspection to loss.

• A. The Group has not capitalised borrowing costs as part of property, plant and equipment for the years ended December 31, 2020 and 2019.

• B. The Group’s property, plant and equipment were owner-occupied for the years ended December 31, 2020 and 2019.

• C. Information about impairment loss and reversal of impairment on property, plant and equipment is provided in Note 6(9).

• D. As of December 31, 2020 and 2019, the Group has not pledged any property, plant and equipment as collateral.

－ (8) LEASING ARRANGEMENTS LESSEE

• A. The Group leases land and buildings and structures. Rental contracts are typically made for periods of 50 (including the option to extend the leases) and 2 years. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements do not impose covenants, but leased assets may not be used as security for borrowing purposes.

• B. Short-term leases with a lease term of 12 months or less pertain to office premises and low-value assets pertain to computers.

• C. The carrying amount of right-of-use assets and the depreciation charge are as follows:

assets pertain to computers. The carrying amount of right-of-use assets and	the depreciation charge are as follows:	e as follows:
Land Buildings and structures Land Buildings and structures	December31,2020 December31,2019 Carrying amount Carrying amount 627,523 $ 673,087 $ 2,363 - 629,886 $ 673,087 $ Forthe years endedDecember31,	December31,2019
		Carrying amount
		673,087 $ -
		673,087 $
	2020 Depreciation charge 14,202 $ 337 14,539 $	2019
		Depreciation charge
		16,972 $ -
		16,972 $

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D. The information on income and expense accounts relating to lease contracts is as follows:

	For the	years ended December31,
	2020	2019
Items affecting profit or loss
Interest expense on lease liabilities	$	6,900 $	8,510
Expense on short-term lease contracts		1,729	4,120
Expense on leases of low-value assets		1,005	877

• E. For the years ended December 31, 2020 and 2019, the Group’s total cash outflow for leases were $19,406 and $24,842, respectively.

(9) IMPAIRMENT OF NON-FINANCIAL ASSETS

• －

• A. The Group recognised impairment loss amounting to $ and $707 for the years ended December 31, 2020 and 2019, respectively. Some of the idle machineries were again utilised in production and accordingly, the Group recognised the reversal of impairment loss amounting to $4,282 and －

• $ for the years ended December 31, 2020 and 2019 (listed as “Other gains and losses”), respectively. For details of accumulated impairment, please refer to Note 6(7).

• B. The (reversal of) impairment loss reported by operating segments is as follows:

				Forthe years endedDecember31,	Forthe years endedDecember31,	Forthe years endedDecember31,	Forthe years endedDecember31,	Forthe years endedDecember31,
				2020				2019
				Recognised in other				Recognised in other
		Recognised in		comprehensive			Recognised in		comprehensive
Segments		profit or loss			income		profit or loss		income
ScinoPharm Taiwan	($		4,253)	$		-	707 $	$	-
SciAnda (Changshu)	(		29)			-	-		-
	($		4,282)	$		-	707 $	$	-
SHORT-TERM BORROWINGS
Type ofborrowings			December31,		2020	Interestrate			Collateral
Bank loans
Unsecured loans			$		9,494		0.79%		None
Type ofborrowings			December31,		2019	Interestrate			Collateral
Bank loans
Unsecured loans			$	89,766			4.35%		None

(10) SHORT-TERM BORROWINGS

Please refer to Note 6(23) for interest expense recognised in profit or loss for the years ended December 31, 2020 and 2019.

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(11) OTHER PAYABLES

Accrued salaries and bonuses Accrued employees' compensation and directors' remuneration Payables on equipment Others	December31,2020 82,764 $ 43,210 59,707 177,140 362,821 $	December31,2019 75,963 $ 28,493 48,148 180,772 333,376 $

(12) LONG-TERM BORROWINGS

Type of borrowings Borrowing period December 31, 2019 Interest rate Collateral Long-term bank loans Secured bank loans CNY 33,500 $ 144,234 4.25% Guaranteed by thousand the Company 9.30.2019 ～ 10.29.2020 Less: Current portion ( 144,234) - $

There is no such situation for the year ended December 31, 2020.

Please refer to Note 6(23) for interest expense recognised in profit or loss for the years ended December 31, 2020 and 2019.

(13) PENSIONS

A. The Company has set up a defined benefit pension plan in accordance with the Labor Standards Law, which applies to all regular employees’ service years prior to the enforcement of the Labor Pension Act (the “Act”) on July 1, 2005 and service years thereafter of employees who chose to continue to be covered under the pension scheme of the Labor Standards Law after the enforcement of the Act. In accordance with the Company's retirement plan, an employee may retire when the employee either (i) attains the age of 55 with 15 years of service, (ii) has more than 25 years of service, (iii) has reached the age of 65, or (iv) is incapacitated to work (compulsory retirement). The employees earn two units for each year of service for the first 15 years, and one unit for each additional year thereafter up to a maximum of 45 units. Any fraction of a year equal to or more than six months shall be counted as one year of service, and any fraction of a year less than six months shall be counted as half a year. According to the provisions, employees who retired due to their duties shall get additional 20%. Pension payments are based on the number of units earned and the average salary of the last six months prior to retirement. Calculation of average salary is in accordance with the Labor Standards Law of the R.O.C. The Company contributes monthly an amount equal to 2% of the employees' monthly salaries and wages to the retirement fund deposited with Bank of Taiwan under the name of the independent retirement fund committee. Also, the Company would assess the balance in the

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aforementioned labor pension reserve account by December 31, every year. If the account balance is not enough to pay the pension calculated by the aforementioned method to the employees expected to qualify for retirement in the following year, the Company will make contribution for the deficit by end of March next year.

(a) The amounts recognised in the balance sheet are as follows:

	December	December	31,2020	December	December	31,2019
Present value of defined benefit obligations		$	109,601		$	127,729
Fair value of plan assets	(		30,369)	(		45,547)
Net defined benefit liability		$	79,232		$	82,182

• (b) Movements in net defined benefit liabilities are as follows:

Present value of

==> picture [445 x 242] intentionally omitted <==

----- Start of picture text -----

For the year ended defined benefit Fair value of Net defined
December 31, 2020 obligations plan assets benefit liability
At January 1 $ 127,729 ($ 45,547) $ 82,182
Current service cost 1,696 - 1,696
Interest expense (income) 894 ( 319) 575
130,319 ( 45,866) 84,453
Remeasurements:
Return on plan assets - ( 1,642) ( 1,642)
Change in financial
-
assumptions ( 17,202) ( 17,202)
Experience adjustments 16,475 - 16,475
( 727) ( 1,642) ( 2,369)
Pension fund contribution - ( 2,852) ( 2,852)
Paid pension ( 19,991) 19,991 -
At December 31 $ 109,601 ($ 30,369) $ 79,232
----- End of picture text -----

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==> picture [444 x 257] intentionally omitted <==

----- Start of picture text -----

Present value of
For the year ended defined benefit Fair value of Net defined
December 31, 2019 obligations plan assets benefit liability
At January 1 $ 121,105 ($ 44,242) $ 76,863
Current service cost 1,579 - 1,579
Interest expense (income) 1,211 ( 442) 769
123,895 ( 44,684) 79,211
Remeasurements:
Return on plan assets - ( 1,976) ( 1,976)
Change in financial
-
assumptions 3,927 3,927
-
Experience adjustments 3,985 3,985
7,912 ( 1,976) 5,936
Pension fund contribution - ( 2,965) ( 2,965)
Paid pension ( 4,078) 4,078 -
At December 31 $ 127,729 ($ 45,547) $ 82,182
----- End of picture text -----

(c) The Bank of Taiwan was commissioned to manage the Fund of the Company’s defined benefit pension plan in accordance with the Fund’s annual investment and utilisation plan and the “Regulations for Revenues, Expenditures, Safeguard and Utilisation of the Labor Retirement Fund” (Article 6: The scope of utilisation for the Fund includes deposit in domestic or foreign financial institutions, investment in domestic or foreign listed, over-the-counter, or private placement equity securities, investment in domestic or foreign real estate securitization products, etc.). With regard to the utilisation of the Fund, its minimum earnings in the annual distributions on the final financial statements shall be no less than the earnings attainable from the amounts accrued from two-year time deposits with the interest rates offered by local banks. If the earnings is less than aforementioned rates, government shall make payment for the deficit after being authorised by the Regulator. The Company has no right to participate in managing and operating that fund and hence the Company is unable to disclose the classification of plan asset fair value in accordance with IAS 19 paragraph 142. The composition of fair value of plan assets as of December 31, 2020 and 2019 is given in the Annual Labor Retirement Fund Utilisation Report announced by the government.

(d) The principal actuarial assumptions used were as follows:

For the years ended December 31,

Discount rate Future salary increases	2020 0.30% 1.00%	2019
		0.70%
		3.00%

Assumptions regarding future mortality experience are set based on actuarial advice in accordance with published statistics and experience according to Taiwan Life Insurance Industry 5th Mortality Table for the years ended December 31, 2020 and 2019.

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Because the main actuarial assumption changed, the present value of defined benefit obligation is affected. The analysis was as follows:

==> picture [442 x 178] intentionally omitted <==

----- Start of picture text -----

Discount rate Future salary increases
Increase 0.25% Decrease 0.25% Increase 0.25% Decrease 0.25%
December 31, 2020
Effect on present
value of defined
benefit obligation ($ 2,794) $ 2,890 $ 2,585 ($ 2,516)
December 31, 2019
Effect on present
value of defined
benefit obligation ($ 3,284) $ 3,403 $ 3,000 ($ 2,916)
----- End of picture text -----

The sensitivity analysis above was based on one assumption which changed while the other conditions remain unchanged. In practice, more than one assumption may change all at once. The method of analysing sensitivity and the method of calculating net pension liability in the balance sheet are the same.

The methods and types of assumptions used in preparing the sensitivity analysis did not change compared to the previous year.

• (e) Expected contributions to the defined benefit pension plan of the Company for 2021 amount to $2,966.

• (f) As of December 31, 2020, the weighted average duration of that retirement plan is 10 years. The analysis of timing of the future pension payment was as follows:

The analysis of timing of the future pension payment was as follows:
Within 1 year 2~5 years Over 6 years	2,097 $ 14,864 96,120
	113,081 $

• B. As a result of the enforcement of the Act, the Company set up a defined contribution pension plan which took effect on July 1, 2005. The local employees are eligible for the defined contribution plan. For employees who choose to be covered under the pension scheme of the Act, the Company contributes monthly an amount of not less than 6% of the employees’ monthly salaries and wages to the employees’ individual pension accounts at the Bureau of Labor Insurance. Pensions are paid by monthly installments or in lump sum based on the accumulated balances of the employees’ individual pension accounts. The subsidiaries in Mainland China (SciAnda (Kunshan) Biochemical Technology, Ltd., SciAnda (Changshu) Pharmaceuticals, Ltd., and SciAnda Shanghai Biochemical Technology, Ltd.) are subject to a government sponsored defined contribution plan. In accordance with the related Laws of the People’s Republic of China, the subsidiaries in Mainland China contribute monthly 18% of the employees’ monthly salaries and

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wages to an independent fund administered by the government. Other than the monthly contributions, these subsidiaries do not have further obligations. The other subsidiaries, SPT International, Ltd. and ScinoPharm Singapore Pte Ltd., had no employees. For the years ended December 31, 2020 and 2019, the pension costs recognised under the aforementioned defined contribution pension plans were $26,135 and $30,712, respectively.

(14) SHARE CAPITAL

• A. Movements in the number of the Company’s ordinary shares outstanding are as follows (in thousands of shares):

For the years ended December 31, 2020 2019 Beginning and end of year 790,739 790,739

• B. As of December 31, 2020, the Company’s authorised capital was $10,000,000 and the paid-in capital was $7,907,392 (790,739 thousand shares) with a par value of $10 (in dollars) per share. All proceeds from shares issued have been collected.

(15) CAPITAL RESERVES

• A. Pursuant to the R.O.C. Company Act, capital reserve arising from paid-in capital in excess of par value on issuance of common stocks and donations shall be exclusively used to cover accumulated deficit or, distribute cash or stocks in proportion to their share ownership, provided that the Company has no accumulated deficit. Further, the R.O.C. Securities and Exchange Act requires that the capital reserve to be capitalised mentioned above should not exceed 10% of the paid-in capital each year. Capital reserve should not be used to cover accumulated deficit unless the legal reserve is insufficient.

• B. Movements on the Company’s capital reserve are as follows:

At January 1 Employee stock options compensation cost - Company Employee stock options forfeited - Company - Subsidiaries At December 31	Forthe yearendedDecember31,2020	Forthe yearendedDecember31,2020
	Share premium Stockoptions 1,245,682 $ 48,923 $ - 84 1,082 1,082) ( 208 208) ( 1,246,972 $ 47,717 $	Total
		1,294,605 $ 84 - -
		1,294,689 $

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		Forthe year	Forthe year	endedDecember	31,	2019
		Share premium		Stockoptions		Total
At January 1	$	1,237,787	$	54,768	$	1,292,555
Employee stock options
compensation cost
- Company		-		2,050		2,050
Employee stock options forfeited
- Company		7,686	(	7,686)		-
- Subsidiaries		209	(	209)		-
At December 31	$	1,245,682	$	48,923	$	1,294,605

(16) SHARE-BASED PAYMENT – EMPLOYEES’ COMPENSATION

• A. The Company issued 1 million units, 1.5 million units and 1.5 million units of employee stock options on December 3, 2013, November 6, 2015 and October 14, 2016, respectively (the ‘Grant Date’). The exercise price of the options was set at $91.70 (in dollars), $41.65 (in dollars) and $40.55 (in dollars), respectively, which was based on the closing market price of the Company's common shares on the Grant Dates. Each option gives the holder the right to purchase one share of the Company's common stocks. The exercise price is subject to further adjustments when there is a change in the number of shares of the Company's common stocks after the Grant Date. (As of December 31, 2020, for the issued 1 million units, 1.5 million units and 1.5 million units of employee stock options, the exercise price was adjusted based on the specific formula to $74.50 (in dollars) per share, $37.20 (in dollars) per share and $37.70 (in dollars) per share, respectively.) Contract period of the employee stock option plans is 10 years, and options are exercisable in 2 years after the Grant Date. The Group recognised compensation costs relating to the employee stock options plan of $84 and $2,050 for the years ended December 31, 2020 and 2019, respectively.

• B. Details of the share-based payment arrangements are as follows:

		Forthe yearended	December31,2020
			Weighted-average
		Number of options	exercise price
		(inthousand units)	(indollars)
Options outstanding at beginning of the year		2,205	$ 45.05
Options forfeited	(	76)	49.15
Options outstanding at end of the year		2,129	44.90
Options exercisable at end of the year		2,129	44.90

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For the year ended December 31, 2019

Number of options (inthousand units) Options outstanding at beginning of the year 2,725 Options forfeited 520) ( Options outstanding at end of the year 2,205 Options exercisable at end of the year 1,967	Weighted-average exercise price (indollars)
	$ 46.08 46.89 45.05 45.93

• C. The expiry date, exercisable shares and exercise prices of the employee stock options at balance sheet date are as follows:

Grant date 12.3.2013 11.6.2015 10.14.2016	No. of stocks Exercise price No. of stocks Exercise price Expiry date (unitinthousands) (indollars) (unitinthousands) (indollars) 12.2.2023 427 74.50 $ 451 74.50 $ 11.5.2025 776 37.20 802 37.20 10.13.2026 926 37.70 714 37.70 December 31, 2020 December31,2019

• D. The fair value of the Group’s employee stock options on Grant Date was evaluated using the combination of Hull & White and the Ritchken trinomial option valuation model. Related information is as follows:

Type of arrangement	Stock Exercise price price Grant date (in dollars) (in dollars) 12.3.2013 91.70 $ 91.70 $ 11.6.2015 41.65 41.65 10.14.2016 40.55 40.55	Price volatility	Option life	Expected dividends	Interest rate 1.7145% 1.2936% 0.9223%	Fair value per unit (in dollars)
Employee stock options Employee stock options Employee stock options		28.50% (Note) 37.63% (Note) 37.20% (Note)	10 years 10 years 10 years	1.5% 1.5% 1.5%		26.045 $ 13.799 13.171

Note: According to daily returns of the Company's stock for the previous year, the annualized volatility is 28.50%, 37.63% and 37.20%, respectively.

(17) RETAINED EARNINGS

• A. Pursuant to the amended Articles of Incorporation, the current year's after-tax earnings should be used initially to cover any accumulated deficit; thereafter 10% of the remaining earnings should be set aside as legal reserve until the balance of legal reserve is equal to that of paid-in capital. The legal reserve shall be exclusively used to cover accumulated deficit, to issue new stocks, or to distribute cash to shareholders in proportion to their share ownership. The use of legal reserve for the issuance of stocks or cash dividends to shareholders in proportion to their share ownership is permitted provided that the distribution of the reserve is limited to the portion in exceeds 25% of the Company’s paid-in capital.

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• B. Since the Company is in a changeable industry environment and the life cycle of the Company is in a stable growth, the appropriation of earnings should consider fund requirements and capital budget to decide how much earnings will be kept or distributed and how much cash dividends will be distributed. According to the Company’s Articles of Incorporation, 10% of the annual net income, after offsetting any loss of prior years and paying all taxes and dues, shall be set aside as legal reserve. The remaining net income and the unappropriated retained earnings from prior years can be distributed in accordance with a resolution passed during a meeting of the Board of Directors and approved at the stockholders' meeting. Of the amount to be distributed by the Company, stockholders’ dividends shall comprise 50% to 100% of the unappropriated retained earnings, and the percentage of cash dividends shall not be less than 30% of dividends distributed.

• C. In accordance with the regulations, the Company shall set aside special reserve for the debit balance on other equity items at the balance sheet date before distributing earnings. When debit balance on other equity items is reversed subsequently, the reversed amount could be included in the distributable earnings. The amounts previously set aside by the Company as special reserve on initial application of IFRSs in accordance with Order No. Financial-Supervisory-SecuritiesCorporate-1010012865, dated April 6, 2012, shall be reversed proportionately when the relevant assets are used, disposed of or reclassified subsequently.

• D. The Company recognised cash dividends distributed to owners amounting to $213,500 ($0.27 (in dollars) per share) and $387,462 ($0.49 (in dollars) per share) for the years ended December 31, 2020 and 2019, respectively. On March 18, 2021, the Board of Directors proposed for the distribution of cash dividends of $395,370 ($0.5 (in dollars) per share) from 2020 earnings.

(18) OTHER EQUITY ITEMS

OTHER EQUITY ITEMS
		Forthe year		endedDecember31,2020
			Unrealised gain (loss)
	Currency	translation		onvaluation		Total
At January 1	($	98,117)	$	30,291	($	67,826)
Revaluation		-		176,406		176,406
Revaluation transferred to
retained earnings		-	(	164,129)	(	164,129)
Currency translation differences
- Group		22,506		-		22,506
At December 31	($	75,611)	$	42,568	($	33,043)

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For the year ended December 31, 2019

				Unrealised gain (loss)	Unrealised gain (loss)
		Currency	translation		onvaluation			Total
At January 1	($		41,252)	$	80,868		$	39,616
Revaluation			-	(	48,718)	(		48,718)
Revaluation transferred to
retained earnings			-	(	1,859)	(		1,859)
Currency translation differences
- Group	(		56,865)		-	(		56,865)
At December 31	($		98,117)	$	30,291	($		67,826)

(19) OPERATING REVENUE

• A. Disaggregation of revenue from contracts with customers

The Group derives revenue from the transfer of goods at a point in time and the vendor of services over time in the following major product lines:

For the year ended December31,2020 Timing of revenue recognition: At a point in time Over time For the year ended December31,2019 Timing of revenue recognition: At a point in time Over time	API Income 2,798,310 $ - 2,798,310 $ API Income 2,593,217 $ - 2,593,217 $	Injection Product Income 146,322 $ - 146,322 $ Injection Product Income 138,202 $ - 138,202 $	Technical Servical Income - $ 98,675 98,675 $ Technical Servical Income - $ 116,760 116,760 $	Other Operating Income - $ 39,621 39,621 $ Other Operating Income - $ 44,604 44,604 $	Total
					2,944,632 $ 138,296
					3,082,928 $
					Total
					2,731,419 $ 161,364
					2,892,783 $

• B. The Group has recognised contract liabilities related to the contract revenue from advance customer payment of $66,846, $55,985 and $30,617 as of December 31, 2020, December 31, 2019, and January 1, 2019, respectively.

• C. The revenue recognised that was included in the contract liability balance at the beginning of the year amounted to $40,579 and $29,695 for the years ended December 31, 2020 and 2019, respectively.

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(20) INTEREST INCOME

INTEREST INCOME
OTHER INCOME OTHER GAINS AND LOSSES 2020 2019 Interest income from bank deposits 24,354 $ 30,659 $ Interest income from financial assets measured at amortised cost 3,054 7,317 27,408 $ 37,976 $ For theyears ended December31, 2020 2019 Production capacity subsidy income 7,229 $ 7,890 $ Gains on write-off of past due payable 5,299 124 Compensation income - 30,109 Government grant - 8,963 Others 3,850 6,788 16,378 $ 53,874 $ Forthe years endedDecember31, 2020 2019 Net gain (loss) on financial assets/liabilities at fair value through profit or loss 2,295 $ 2,552) ($ Gain on reversal of (impairment loss) 4,282 707) ( Loss on disposal of property, plant and equipment 3,157) ( 39) ( Net currency exchange (loss) gain 31,261) ( 5,700 Loss on unfinished construction in progress 11,900) ( 22,726) ( Others 6,097) ( 17,637) ( 45,838) ($ 37,961) ($ For the years ended December 31,	2020 24,354 $ 3,054 27,408 $ For theyears ended Forthe years ended	2019 December31,
		30,659 $ 7,317 37,976 $
		December31,
	2020 7,229 $ 5,299 - - 3,850 16,378 $ For the years ended	2019
		7,890 $ 124 30,109 8,963 6,788
		53,874 $
		December 31,
		2019

(21) OTHER INCOME

(22) OTHER GAINS AND LOSSES

(23) FINANCE COSTS

FINANCE COSTS
Interest expense: Bank loans Interest on lease liabilities	For theyears ended	December31,
	2020 8,266 $ 6,900 15,166 $	2019
		47,179 $ 8,510
		55,689 $

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(24) EXPENSES BY NATURE

EXPENSES BY NATURE
EMPLOYEE BENEFIT EXPENSES Employee benefit expenses Depreciation of property, plant and equipment Depreciation of right-of-use assets Amortisation Employee benefit expenses Depreciation of property, plant and equipment Depreciation of right-of-use assets Amortisation Salaries and wages Labor and health insurance expenses Pension costs Other personnel expenses Salaries and wages Labor and health insurance expenses Pension costs Other personnel expenses	Operating costs Operating expenses Total 445,129 $ 361,694 $ 806,823 $ 259,917 109,272 369,189 - 14,539 14,539 3,292 6,177 9,469 708,338 $ 491,682 $ 1,200,020 $ Operating costs Operating expenses Total 420,528 $ 327,503 $ 748,031 $ 271,897 107,640 379,537 - 16,972 16,972 4,307 7,899 12,206 696,732 $ 460,014 $ 1,156,746 $ Forthe yearendedDecember31,2020 Forthe yearendedDecember31,2019 For the year ended December 31, 2020
	Operating costs Operating expenses Total 381,788 $ 310,556 $ 692,344 $ 30,413 21,246 51,659 16,269 12,137 28,406 16,659 17,755 34,414 445,129 $ 361,694 $ 806,823 $ Forthe yearendedDecember31,2019		Total
			692,344 $ 51,659 28,406 34,414
			806,823 $
	Operating costs 352,944 $ 31,246 20,407 15,931 420,528 $	Operating expenses 275,393 $ 19,813 12,653 19,644 327,503 $	Total
			628,337 $ 51,059 33,060 35,575
			748,031 $

(25) EMPLOYEE BENEFIT EXPENSES

• A. According to the Articles of Incorporation of the Company, a ratio of distributable profit of the current year, after covering accumulated losses, shall be distributed as employees’ compensation and directors’ remuneration. The ratio shall not be lower than 2% for employees’ compensation and shall not be higher than 2% for directors’ remuneration.

• B. For the years ended December 31, 2020 and 2019, the employees’ compensation was accrued at $35,288 and $24,651, respectively, while the directors’ remuneration was accrued at $7,922 and $3,842, respectively. The aforementioned amounts were recognised in salary expenses. The expenses recognised for each year was accrued based on the earnings of current year and the

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percentage specified in the Articles of Incorporation of the Company. On March 18, 2021, the Board of Directors resolved to distribute employees’ compensation and directors’ remuneration of $35,288 and $7,922, respectively, and the employees’ compensation will be distributed in the form of cash.

The actual amount approved at the Board of Directors’ meeting for employees’ compensation and directors’ remuneration for 2019 was $27,593 which was the different from the estimated amount of $28,493 recognised in the 2019 financial statements by $900. Such difference mainly resulted from estimation, and have been recognised in profit or loss in September 2020. The employees’ compensation will be distributed in the form of cash for 2019. Information about the appropriation of employees’ compensation and directors’ remuneration by the Company as resolved by the Board of Directors will be posted in the “Market Observation Post System” at the website of the Taiwan Stock Exchange.

(26) INCOME TAX

A. Income tax expense

(a) Components of income tax expense:

Total current tax Origination and reversal of temporary differences Income tax expense Current income tax: Income tax in current year Tax on unappropriated retained earnings Underprovision of prior year's income tax Deferred income tax:	2020 2019 69,941 $ 58,521 $ - 227 4,410 980 74,351 59,728 2,087 11,330) ( 76,438 $ 48,398 $ Forthe years endedDecember31,

(b) The income tax relating to components of other comprehensive income is as follows:

Remeasurement of defined benefit obligations plan	2020 2019 473 $ 1,187) ($ Forthe years endedDecember31,

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B. Reconciliation between income tax expense and accounting profit:

			Forthe years ended	Forthe years ended	Forthe years ended	December31,
			2020			2019
Income tax at statutory tax rate		$	45,547		$	50,178
Effect of items disallowed by tax regulation			32,793			20,395
Effect of net operating loss carryforward	(		3,216)	(		21,604)
Effect of investment tax credits	(		3,096)	(		1,778)
Tax on unappropriated retained earnings			-			227
Underprovision of prior year's income tax			4,410			980
Income tax expense		$	76,438		$	48,398

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• C. Amounts of deferred tax assets or liabilities as a result of temporary differences and loss carryforward are as follows:

January1 Recognised in profit or loss Deferred tax assets: Temporary differences Unrealised loss on inventory market value decline 77,688 $ 14,924) ($ Unrealised loss on components and spare parts market value decline 16,203 662 Investment loss 377,753 20,924 Technology know-how 7,976 4,350) ( Pensions 16,436 116) ( Employee benefits - unused compensated absences 4,659 206 Impairment of assets 1,857 851) ( Unrealised exchange loss 1,424 490) ( Unrealised gain of financial liabilities - 434 Unrealised loss 187 187) ( Rent expenses 763 763) ( Loss carryforward 101,177 3,216) ( 606,123 $ 2,671) ($ Deferred tax liabilities: Temporary differences Unrealised gain on financial instruments 584) ($ 584 $ 605,539 $ 2,087) ($ Forthe yearended	Forthe yearended	Forthe yearended	December31,2020	December31,2020
		Recognised in profit or loss	Recognised in other comprehensive income - $ - - - 473) ( - - - - - - - 473) ($ - $ 473) ($	December31
		14,924) ($ 662 20,924 4,350) ( 116) ( 206 851) ( 490) ( 434 187) ( 763) ( 3,216) ( 2,671) ($ 584 $ 2,087) ($		62,764 $ 16,865 398,677 3,626 15,847 4,865 1,006 934 434 - - 97,961
				602,979 $
				- $
				602,979 $

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For the year ended December 31, 2019

January1 Recognised in profit or loss Deferred tax assets: Temporary differences Unrealised loss on inventory market value decline 78,206 $ 518) ($ Unrealised loss on components and spare parts market value decline - 16,203 Investment loss 354,208 23,545 Technology know-how 12,326 4,350) ( Pensions 15,373 124) ( Employee benefits - unused compensated absences 4,812 153) ( Impairment of assets 1,716 141 Unrealised exchange loss 811 613 Unrealised loss 2,870 2,683) ( Rent expenses - 763 Loss carryforward 122,781 21,604) ( 593,103 $ 11,833 $ Deferred tax liabilities: Temporary differences Unrealised gain on financial instruments 81) ($ 503) ($ 593,022 $ 11,330 $		Recognised in other comprehensive income December31 - $ 77,688 $ - 16,203 - 377,753 - 7,976 1,187 16,436 - 4,659 - 1,857 - 1,424 - 187 - 763 - 101,177 1,187 $ 606,123 $ - $ 584) ($ 1,187 $ 605,539 $	December31
			77,688 $ 16,203 377,753 7,976 16,436 4,659 1,857 1,424 187 763 101,177
			606,123 $

D. Expiration dates of unused operating loss carryforward and amounts of unrecognised deferred tax assets are as follows:

		December31,2020	December31,2020
Year incurred 2016～2020	Amount filed /assessed 958,005 $	Unrecognised Unused tax credits deferred tax assets 958,005 $ 566,160 $ December31,2019		Expiry year
				2021～2025
Year incurred 2015～2019	Amount filed /assessed 1,160,244 $	Unused tax credits 1,031,674 $	Unrecognised deferred tax assets 626,968 $	Expiry year
				2020～2024

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• E. The Company’s income tax returns through 2018 have been assessed and approved by the Tax Authority, and there were no disputes existing between the Company and the Authority as of March 18, 2021.

(27) EARNINGS PER SHARE (“EPS”)

Basic earnings per share Profit attributable to ordinary stockholders of the parent Diluted earnings per share Profit attributable to ordinary stockholders of the parent Assumed conversion of all dilutive potential ordinary shares Employees' stock options Employees' compensation Profit attributable to ordinary stockholders of the parent plus assumed conversion of all dilutive potential ordinary shares

Weighted average number of shares outstanding EPS Amount aftertax (sharesinthousands) (indollars) 282,067 $ 790,739 0.36 $ 282,067 $ 790,739 - - - 1,450 282,067 $ 792,189 0.36 $ For theyear ended December31,2020

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Basic earnings per share Profit attributable to ordinary stockholders of the parent Diluted earnings per share Profit attributable to ordinary stockholders of the parent Assumed conversion of all dilutive potential ordinary shares Employees' stock options Employees' compensation Profit attributable to ordinary stockholders of the parent plus assumed conversion of all dilutive potential ordinary shares	Weighted average number of shares outstanding EPS Amount aftertax (sharesinthousands) (indollars) 216,656 $ 790,739 0.27 $ 216,656 $ 790,739 - - - 1,336 216,656 $ 792,075 0.27 $ For theyear ended December31,2019	Weighted average number of shares outstanding EPS Amount aftertax (sharesinthousands) (indollars) 216,656 $ 790,739 0.27 $ 216,656 $ 790,739 - - - 1,336 216,656 $ 792,075 0.27 $ For theyear ended December31,2019
		0.27 $
		0.27 $

For the years ended December 31, 2020 and 2019, some abovementioned stock options issued are anti-dilutive; therefore they were not included in the diluted EPS calculation.

(28) SUPPLEMENTAL CASH FLOW INFORMATION

A. Investing activities with partial cash payments:

			Forthe years ended	Forthe years ended	December31,
			2020		2019
Purchase of property, plant and equipment		$	76,795	$	28,082
Add: Beginning balance of payable on
equipment (listed as “Other payables”)			48,148		41,417
Less: Ending balance of payable on
equipment (listed as “Other payables”)	(		59,707)	(	48,148)
Cash paid for acquisition of property, plant
and equipment		$	65,236	$	21,351

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B. Investing activities with no cash flow effects:

(a) Prepayments for equipment reclassified to property, plant and equipment (b) Property, plant and equipment reclassified to intangible assets	2020 2019 66,587 $ 102,546 $ 1,161 $ 6,500 $ For theyears ended December31,

(29) CHANGES IN LIABILITIES FROM FINANCING ACTIVITIES

							Guarantee	Guarantee	Guarantee	Liabilities from	Liabilities from	Liabilities from
	Short-term			Lease	Long-term			deposits				financing
	borrowings		liabilities		borrowings			received		activities-gross
At January 1, 2020	$	89,766	$	606,034	$	144,234	$		87		$	840,121
Changes in cash flow
from financing activities	(	79,420)	(	9,772)	(	143,430)			1,214	(		231,408)
Impact of changes in foreign
exchange rate	(	852)		-	(	804)	(		1)	(		1,657)
Changes in other
non-cash items		-	(	29,580)		-			-	(		29,580)
At December 31, 2020	$	9,494	$	566,682	$	-	$		1,300		$	577,476
							Guarantee			Liabilities from
	Short-term			Lease	Long-term			deposits				financing
	borrowings		liabilities		borrowings			received		activities-gross
At January 1, 2019	$	233,290	$	-	$	1,178,503		$	1,708		$	1,413,501
Effect on retrospective
application and restatement		-		900,288		-			-			900,288
Changes in cash flow from
financing activities	(	140,356)	(	11,335)	(	1,031,088)	(		1,618)	(		1,184,397)
Impact of changes in foreign
exchange rate	(	3,168)		-	(	3,181)			-	(		6,349)
Changes in other
non-cash items		-	(	282,919)		-	(		3)	(		282,922)
At December 31, 2019	$	89,766	$	606,034	$	144,234		$	87		$	840,121

7. RELATED PARTY TRANSACTIONS

(1) Parent and ultimate controlling party

The ultimate parent and ultimate controlling party of the Company is Uni-President Enterprises Corp.

(2) Names of related parties and relationship

Names of related parties Relationship with the Company Uni-President Enterprises Corp. Ultimate parent company President Securities Corp. Associate of ultimate parent company

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(3) Significant transactions and balances with related parties

Other expenses

Other expenses
Management service fees: －Ultimate parent company －Associate of ultimate parent company	For theyears ended December31,
	2020 4,592 $ 2,250 6,842 $	2019
		6,935 $ 2,091
		9,026 $

(4) Key management compensation

Key management compensation
		Forthe years ended		December31,
		2020		2019
Salaries and other short-term employee
benefits	$	51,817	$	44,185
Share-based payments		20		542
Post-employment benefits		694		692
Termination benefits		1,470		1,470
	$	54,001	$	46,889

8. PLEDGED ASSETS

Details of the Group’s assets pledged as collateral are as follows:

Assets Restricted deposits (Note 1) Time deposits (Note 2)	December31,2020 34,311 $ 29,270 63,581 $	December31,2019 Purpose of collateral - $ Construction payment dispute (Note 1) 29,270 Customs duty and performance guarantee 29,270 $

Note 1: Listed as “Other financial assets - current”, and please refer to Note 9. Note 2: Listed as “Other financial assets - non-current”.

9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNISED CONTRACT COMMITMENTS

• (1) As of December 31, 2020 and 2019, the Group’s unused letters of credit amounted to $7,536 and $7,707, respectively.

• (2) As of December 31, 2020 and 2019, the Group’s remaining balance due for construction in progress and prepayments for equipment was $69,181 and $62,997, respectively.

• (3) The amounts of endorsements and guarantees for subsidiaries were as follows:

SciAnda (Changshu) Pharmaceuticals, Ltd.	Nature Guarantee for financing amount	December31,2020 1,005,928 $	December31,2019
			2,063,467 $

As of December 31, 2020 and 2019, the actual amount drawn down for endorsements and guarantees

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－ to subsidiaries was $ and $144,234, respectively.

• (4) In December 2020, SciAnda (Changshu) Pharmaceuticals, Ltd., a subsidiary of the Group, has been drawn into a construction payment dispute with Jiangsu Qian Construction Group Co., Ltd. The latter has filed for a provisional attachment of part of the Group’s bank deposits with the district court until December 18, 2021. As of December 31, 2020, bank deposits totaling $34,311 (CNY 7,864 thousands) has been frozen, and listed as “Other financial assets - current”. The case is under with the People’s Court of Changshu City in Jiangsu Province.

• SIGNIFICANT DISASTER LOSS: None.

• SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DATE: None.

12. OTHERS

(1) Capital management

The Group’s objectives on managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide returns for shareholders, to maintain an optimal capital structure, to reduce the cost of capital and to maintain an adequate capital structure to enable the expansion and enhancement of equipment. In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return of capital to shareholders, and issue new shares or sell assets to reduce debts.

(2) Financial instruments

• A. Financial instruments

For details of the Group’s financial instruments by category, please refer to Note 6.

• B. Risk management policies

• (a) The Group’s activities expose it to a variety of financial risks: market risk (including foreign exchange risk, price risk and interest rate risk), credit risk and liquidity risk.

• (b) The Group’s treasury identifies, evaluates and hedges financial risks closely with the Group’s operating units. The Board provides written principles for overall risk management, as well as written policies covering specific areas and matters, such as use of derivative financial instruments and investment of excess liquidity.

• (c) Information about derivative financial instruments that are used to hedge financial risk are provided in Note 6(2).

• C. Significant financial risks and degrees of financial risks

• (a) Market risk

• I. Foreign exchange rate risk

  • (i) The Group operates internationally and is exposed to foreign exchange risk arising from the transactions of the Company and its subsidiaries used in various functional currency, primarily with respect to USD. Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities.

  • (ii) To manage their foreign exchange risk arising from future commercial transactions and recognised assets and liabilities, entities in the Group are required to hedge their foreign

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exchange risk exposure using forward foreign exchange contracts. However, the Group does not adopt hedging accounting. Details of financial assets or liabilities at fair value through profit or loss are provided in Note 6(2).

• (iii)The Group’s businesses involve some non-functional currency operations (the Company’s and certain subsidiaries’ functional currency: NTD; other subsidiaries’ functional currency: CNY). The information on assets and liabilities denominated in foreign currencies whose values would be materially affected by the exchange rate fluctuations is as follows:

fluctuations is as follows:
(Foreign currency: functional currency) Financial assets Monetary items USD:NTD USD:CNY CNY:NTD Financial liabilities Monetary items USD:NTD EUR:NTD (Foreign currency: functional currency) Financial assets Monetary items USD:NTD USD:CNY EUR:NTD CNY:NTD Financial liabilities Monetary items USD:NTD EUR:NTD	December31,2020
	Foreign currency amount(in thousands) Exchange rate 14,237 $ 28.48 1,116 6.527 61 4.363 959 28.48 207 35.02 December31,2019		Book value (NTD)
			405,470 $ 7,284 266 27,312 7,249
	Foreign currency amount(in thousands) 21,415 $ 1,964 32 85 709 447	Exchange rate 29.98 6.963 33.59 4.305 29.98 33.59	Book value (NTD)
			642,022 $ 13,675 1,075 366 21,256 15,015

(iv) As of December 31, 2020 and 2019, if the NTD:USD exchange rate appreciates/depreciates by 5% with all other factors remaining constant, the Group’s net

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profit after tax for the years ended December 31, 2020 and 2019 would increase/decrease by $16,395 and $27,186, respectively. If the NTD:EUR and NTD:CNY exchange rate appreciates/depreciates by 5% with all other factors remaining constant, the effect on the Group’s net profit after tax for the years ended December 31, 2020 and 2019 is immaterial.

• (v)Total exchange gain including realised and unrealised arising from significant foreign exchange variation on the monetary items held by the Group for the years ended December 31, 2020 and 2019 amounted to ($31,261) and $5,700, respectively.

• II. Price risk

The Group’s equity securities, which are exposed to price risk, are the held financial assets at fair value through profit or loss and financial assets at fair value through other comprehensive income. To manage its price risk arising from investments in equity securities, the Group diversifies its portfolio and set stop-loss amounts for these instruments. The Group expects no significant market risk.

III. Cash flow and fair value interest rate risk

• (i) The Group’s main interest rate risk arises from short-term and long-term borrowings with variable rates and exposes the Group to cash flow interest rate risk. During the years ended December 31, 2020 and 2019, the Group’s borrowings at variable rate were denominated in USD and CNY.

• (ii) The Group’s borrowings are measured at amortised cost. The borrowings are periodically contractually repriced and to that extent are also exposed to the risk of future changes in market interest rates.

• (iii) If the borrowing interest rates had increased/decreased by 10% with all other variables held constant, the effect on post-tax profit for the years ended December 31, 2020 and 2019 is immaterial.

• (b) Credit risk

• I. Credit risk refers to the risk of financial loss to the Group arising from default by the clients or counterparties of financial instruments on the contract obligations. The main factor is that counterparties could not repay in full the accounts receivable based on the agreed terms.

• II. The Group manages its credit risk taking into consideration the entire group’s concern. For banks and financial institutions, only independently rated parties with a minimum rating of 'A' are accepted. According to the Group’s credit policy, each local entity in the Group is responsible for managing and analysing the credit risk for each of their new clients before standard payment and delivery terms and conditions are offered. Internal risk control assesses the credit quality of the customers, taking into account their financial position, past experience and other factors. Individual risk limits are set based on internal or external ratings in accordance with limits set by the Board of Directors. The utilisation of credit limits is regularly monitored.

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• III. The Group adopts the following assumption under IFRS 9: If the contract payments were past due over 30 days based on the terms, there has been a significant increase in credit risk on that instrument since initial recognition.

• IV. The Group manages its credit risk, whereby if the contract payments are past due over 180 days based on the terms, there has been impairment.

• V. The Group classifies customers’ accounts receivable in accordance with the credit rating of customer and credit risk on trade. The Group applies the simplified approach using the provision matrix to estimate expected credit loss, and use the forecastability to adjust historical and timely information to assess the default possibility of accounts receivable. Movements in relation to the Group applying the simplified approach to provide loss allowance for accounts receivable are as follows:

			For the years ended	For the years ended	For the years ended	December 31,
			2020			2019
At January 1		$	258		$	45
(Gain on reversal of) expected credit losses	(		219)			214
Impact of foreign exchange rate			-	(		1)
At December 31		$	39		$	258

(c) Liquidity risk

• I. Cash flow forecasting is performed by the Group’s treasury department which monitors rolling forecasts of the Group’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that the Group does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities.

• II. The Group has undrawn borrowing facilities amounting to $5,512,050 and $5,400,333 as of December 31, 2020 and 2019, respectively.

• III. The following table comprises the Group’s non-derivative financial liabilities and derivative financial liabilities with gross-amount settlement that are grouped by their maturity. Nonderivative financial liabilities are analysed from the balance sheet date to the contract maturity date, and derivative financial liabilities are analysed from the balance sheet date to the expected maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.

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December31,2020 Short-term borrowings Notes payable Accounts payable Other payables Lease liabilities Guarantee deposits received December 31, 2019 Short-term borrowings Notes payable Accounts payable Other payables Long-term borrowings Lease liabilities Guarantee deposits received Non-derivative financial liabilities: Non-derivative financial liabilities:	Less than 1year 9,500 $ 1,173 159,671 362,821 16,599 - Less than 1year 90,312 $ 1,353 101,018 333,376 149,342 16,112 -	Between 1 and2years - $ - - - 16,259 1,300 Between 1 and2years - $ - - - - 16,112 87	Between 2 and 5 years - $ - - - 45,712 - Between 2 and 5 years - $ - - - - 48,337 -	More than 5 years
				- $ - - - 655,200 - More than 5 years
				- $ - - - - 708,937 -

(3) Fair value information

• A. The different levels that the inputs to valuation techniques are used to measure fair value of financial and non-financial instruments have been defined as follows:

• Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date. A market is regarded as active where a market in which transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis. The fair value of the Group’s investment in listed stocks is included in Level 1.

• Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. The fair value of the Group’s investment in foreign exchange contracts is included in Level 2.

• Level 3: Unobservable inputs for the asset or liability. The fair value of the Group’s investment in equity investment without active market is included in Level 3.

• B. Financial instruments not measured at fair value

• The carrying amounts of cash and cash equivalents, financial assets at amortised cost - current, accounts receivable, other receivables, guarantee deposits paid, other financial assets - noncurrent, short-term borrowings, notes payable, accounts payable, other payables, long-term borrowings (including current portion) and guarantee deposits received are approximate to their fair values.

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• C. The related information on financial instruments measured at fair value by level on the basis of the nature, characteristics and risks of the assets and liabilities are as follows:

December31,2020 Assets: Recurring fair value measurements Financial assets at fair value through other comprehensive income Equity securities Liabilities: Recurring fair value measurements Financial liabilities at fair value through profit or loss Derivative instruments December31,2019 Assets: Recurring fair value measurements Financial assets at fair value through profit or loss Derivative instruments Financial assets at fair value through other comprehensive income Equity securities	Level 1 188,160 $ - $ Level 1 - $ 271,752 $	Level 2 - $ 2,172 $ Level 2 2,920 $ - $	Level3 119,955 $ - $ Level3 - $ 143,458 $	Total 308,115 $
				2,172 $
				Total
				2,920 $
				415,210 $

• D. The methods and assumptions the Group used to measure fair value are as follows:

• (a) The instruments the Group used market quoted prices as its fair values (that is, Level 1) is listed below by characteristics:

Market quoted price

Listed shares Closing price

• (b) Except for financial instruments with active markets, the fair value of other financial instruments is measured by using valuation techniques or by reference to counterparty quotes. The fair value of financial instruments measured by using valuation techniques can be referred to current fair value of instruments with similar terms and characteristics in substance, discounted cash flow method or other valuation methods, including calculated by applying model using market information available at the consolidated balance sheet date.

• (c) When assessing non-standard and low-complexity financial instruments, for example, debt instruments without active market, interest rate swap contracts, foreign exchange swap contracts and options, the Group adopts valuation technique that is widely used by market participants. The inputs used in the valuation method to measure these financial instruments are normally observable in the market.

• (d) Forward foreign exchange contracts are usually valued based on the current forward exchange rate.

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• E. For the years ended December 31, 2020 and 2019, there was no transfer between Level 1 and Level 2.

• F. The following chart is the movement of Level 3 for the years ended December 31, 2020 and 2019:

			Forthe years ended	Forthe years ended	Forthe years ended	December31,
			2020			2019
			Equityinstrument			Equityinstrument
At January 1		$	143,458		$	200,046
Loss recognised in other
comprehensive income	(		23,503)	(		56,588)
At December 31		$	119,955		$	143,458

• G. For the years ended December 31, 2020 and 2019, there was no transfer in(out) Level 3.

• H. The Group’s valuation procedures for fair value measurements is categorised within Level 3, which is to verify independent fair value of financial instruments. Such assessment is to ensure the valuation results are reasonable by applying independent information to make results close to current market conditions, confirming the resource of information is independent, reliable and in line with other resources and represented as the exercisable price, and frequently assess to make any other necessary adjustments to the fair value.

• I. The following is the qualitative information of significant unobservable inputs and sensitivity analysis of changes in significant unobservable inputs to valuation model used in Level 3 fair value measurement:

value measurement:
Fair value at December31,2020 Non-derivative equity instrument: Unlisted shares 119,955 $ Fair value at December31,2019 Non-derivative equity instrument: Unlisted shares 143,458 $	Valuation technique	Significant unobservable input	Range (weighted average)	Relationship of inputs to fairvalue
	Net asset value Valuation technique	Not applicable Significant unobservable input	－ Range (weighted average)	The higher the net asset value, the higher the fair value Relationship of inputs to fairvalue
	Net asset value	Not applicable	－	The higher the net asset value, the higher the fair value

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• J. The Group has carefully assessed the valuation models and assumptions used to measure fair value. However, use of different valuation models or assumptions may result in different measurement. If the net assets value increased or decreased by 1% for Level 3, however, the effect on other comprehensive income for the years ended December 31, 2020 and 2019 is immaterial.

13. SUPPLEMENTARY DISCLOSURES

According to the current regulatory requirements, the Group is only required to disclose the information for the year ended December 31, 2020.

(1) Significant transactions information

• A. Loans to others: Please refer to table 1.

• B. Provision of endorsements and guarantees to others: Please refer to table 2.

• C. Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures): Please refer to table 3.

• D. Acquisition or sale of the same security with the accumulated cost exceeding $300 million or 20% of the Company’s paid-in capital: Please refer to table 4.

• E. Acquisition of real estate reaching $300 million or 20% of paid-in capital or more: None.

• F. Disposal of real estate reaching $300 million or 20% of paid-in capital or more: None.

• G. Purchases or sales of goods from or to related parties reaching $100 million or 20% of paid-in capital or more: Please refer to table 5.

• H. Receivables from related parties reaching $100 million or 20% of paid-in capital or more: None.

• I. Trading in derivative instruments undertaken during the reporting periods: Please refer to Note 6(2).

• J. Significant inter-company transactions during the reporting periods: Please refer to table 6.

(2) Information on investees

Names, locations and other information of investee companies (not including investees in Mainland China): Please refer to table 7.

(3) Information on investments in Mainland China

• A. Basic information: Please refer to table 8.

• B. Significant transactions, either directly or indirectly through a third area, with investee companies in the Mainland Area: Please refer to table 2 and table 5.

(4) Major shareholders information

Major shareholders information: Please refer to table 9.

14. SEGMENT INFORMATION

(1) General information

The management of the Group has identified the operating segments based on how the Company’s Chief Operating Decision-Maker regularly reviews information in order to make decisions. The Chief Operating Decision-Maker manages the Group’s business from geographical and functional perspectives. Geographically, the Group focuses on its sales business in the U.S., Europe and Asia. In addition, the Group categorized its business units into manufacture, sales, research and

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development and investment management functions, and combines its segments that meet the disclosure threshold as “Others”.

(2) Measurement of segment information

The chief operating decision-maker evaluates the performance of operating segments based on pretax income excluding non-recurring income. For details of operating segments’ accounting policies, please refer to Note 4.

(3) Segment information

The segment information provided to the Chief Operating Decision-Maker for the reportable segments is as follows:

segments is as follows:
Segment revenue Revenue from internal customers Revenue from external customers Interest income Depreciation and amortisation Interest expense Income (loss) from segment before income tax Segment assets Other acquisition of non-current assets Segment liabilities Segment revenue Revenue from internal customers Revenue from external customers Interest income Depreciation and amortisation Interest expense Income (loss) from segment before income tax Segment assets Other acquisition of non-current assets Segment liabilities	For the year ended December 31, 2020
	ScinoPharm SciAnda (Changshu) Taiwan,Ltd. Pharmaceuticals,Ltd. Others Total 3,046,220 $ 440,660 $ 17,266 $ 3,504,146 $ 18,393 390,895 11,930 421,218 3,027,827 49,765 5,336 3,082,928 21,043 6,332 33 27,408 285,822 107,153 222 393,197 7,072 8,094 - 15,166 457,502 95,419) ( 73) ( 362,010 10,095,826 1,842,819 20,735 11,959,380 170,086 23,879 690 194,655 1,247,518 117,051 1,175 1,365,744 Forthe yearendedDecember31,2019		Total
	ScinoPharm SciAnda (Changshu) Taiwan,Ltd. Pharmaceuticals,Ltd. 2,813,047 $ 418,881 $ 19,246 339,973 2,793,801 78,908 28,541 523 295,548 113,102 8,532 47,157 364,239 114,613) ( 9,658,129 1,775,266 98,957 13,155 1,161,394 391,053	Others 39,583 $ 19,509 20,074 8,912 65 - 14,646 441,628 319 1,903	Total
			3,271,511 $ 378,728 2,892,783 37,976 408,715 55,689 264,272 11,875,023 112,431 1,554,350

(4) Reconciliation for segment

A. The sales between segments were at arms’ length. The external revenues reported to the Chief Operating Decision-Maker adopt the same measurement basis for revenues in statement of

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comprehensive income. The reconciliations of pre-tax income between reportable segments and continuing operations were as follows :

			Forthe years ended	Forthe years ended	December31,
			2020		2019
Reportable segments profit before
income tax		$	362,083	$	249,626
Other segments income before
income tax	(		73)		14,646
Internal segments transaction elimination	(		3,505)		782
Profit before income tax		$	358,505	$	265,054

• B. The amount of total assets provided to the Chief Operating Decision-Maker adopts the same measurement for assets in the Group's financial statements. A reconciliation of assets of reportable segments and total assets is as follows:

			December31,2020			December 31, 2019
Assets of reportable segments		$	11,938,645		$	11,433,395
Assets of other operating segments			20,735			441,628
Internal segment transaction elimination	(		112,617)	(		200,459)
Total assets		$	11,846,763		$	11,674,564

• C. The amount of total liabilities provided to the Chief Operating Decision-Maker adopts the same measurement for liabilities in the Group's financial statements. A reconciliation of liabilities of reportable segments and total liabilities is as follows:

			December31,2020			December 31, 2019
Liabilities of reportable segments		$	1,364,569		$	1,552,447
Liabilities of other operating segments			1,175			1,903
Internal segment transaction elimination	(		48,384)	(		139,730)
Total liabilities		$	1,317,360		$	1,414,620

(5) Information on product and service

The Group is engaged in the research and development and manufacture of API, as well as the provision of related consulting and technical services. The reconciliations of total segment and operating revenue were as follows:

operating revenue were as follows:
Revenue from sales of products Revenue from sales of injection products Revenue from technical services Others	Forthe years endedDecember31,
	2020 2,798,310 $ 146,322 98,675 39,621 3,082,928 $	2019
		2,593,217 $ 138,202 116,760 44,604
		2,892,783 $

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(6) Geographical information

Geographical information for the years ended December 31, 2020 and 2019 is as follows:

==> picture [465 x 162] intentionally omitted <==

----- Start of picture text -----

For the year ended December 31, 2020 For the year ended December 31, 2019
Non-current Non-current
Revenue assets Revenue assets
Taiwan $ 129,013 $ 3,728,618 $ 97,475 $ 3,884,292
USA 579,035 - 568,124 -
India 358,419 - 390,446 -
Asia 761,570 1,254,874 885,048 1,322,084
- -
Europe 1,192,614 881,330
Others 62,277 - 70,360 -
$ 3,082,928 $ 4,983,492 $ 2,892,783 $ 5,206,376
----- End of picture text -----

(7) Major customer information

Major customer (individually over 10% of consolidated operating revenue) information of the Group for the years ended December 31, 2020 and 2019 is as follows:

A B C D	Revenue Segment 400,924 $ ScinoPharm Tawian, Ltd. 399,901 ScinoPharm Tawian, Ltd. 355,067 ScinoPharm Tawian, Ltd. - ScinoPharm Tawian, Ltd. 1,155,892 $ Forthe yearendedDecember31,2020	For the year ended December 31, 2019
	Revenue 400,924 $ 399,901 355,067 - 1,155,892 $	Revenue Segment 439,661 $ ScinoPharm Tawian, Ltd. 425,794 ScinoPharm Tawian, Ltd. 248 ScinoPharm Tawian, Ltd. 127,070 ScinoPharm Tawian, Ltd. 992,773 $

~67~

Expressed in thousands of NTD

ScinoPharm Taiwan, Ltd. and Subsidiaries

Loans to others

For the year ended December 31, 2020

Table 1

Number	Name	Name of counterparty	Account	Related parties	Maximum balance	Ending balance	Actual amount drawn down	Interest rate	Nature of financial activity (Note 1)	Total transaction amount	Reason for financing	Allowance for doubtful accounts	Assetspledged	Assetspledged	Loan limit per entity (Note 2)	Maximum amount available for loan (Note 2)	Footnote
													Item	Value
1	SciAnda (Kunshan) Biochemical Technology, Ltd.	SciAnda (Changshu) Pharmaceuticals, Ltd.	Other receivables	Y	87,369 $	- $	- $	3.0%	2	- $	Additional operating capital and loan repayment	- $	－	- $	425,808 $	425,808 $	Note 4

Note 1: The code represents the nature of financing activities as follows:

1. Trading partner.

2. Short-term financing.

Note 2: (1) For trading partner: the maximum amount for individual trading partner shall not exceed the higher of purchase or sales amount of the most recent year or the current year, the maximum amount for total loan is 20% of its

net worth. (2) For short-term financing: the maximum amount for individual is 20% of its net worth, the maximum amount for total loan is 40% of its net worth. If the Company loans to foreign subsidiaries, which the Company holds 100% ownership directly or indirectly, the maximum amount for the subsidiary is 100% of the Company's net worth.

Note 3: The numbers in the table that involves foreign currencies are expressed in New Taiwan Dollars according to the exchange rate posted on the date of the consolidated financial statements (CNY:NTD 1:4.363). Note 4: SciAnda (Kunshan) Biochemical Technology, Ltd. was merged into SciAnda (Changshu) Pharmaceuticals, Ltd. in August 2020.

Table 1, Page 1

Expressed in thousands of NTD

ScinoPharm Taiwan, Ltd. and Subsidiaries

Provision of endorsements and guarantees to others

For the year ended December 31, 2020

Table 2

Ratio of accumulated Party being endorsement/ endorsed/guaranteed Limit on Maximum Outstanding guarantee Ceiling on Provision of Provision of Provision of Relationship endorsements/ outstanding endorsement/ Amount of amount to net total amount of endorsements/ endorsements/ endorsements/ with the guarantees endorsement/ guarantee endorsements/ asset value of endorsements/ guarantees by guarantees by guarantees to endorser/ provided for a guarantee amount at guarantees the endorser/ guarantees parent subsidiary to the party in Endorser/ guarantor single party amount during December 31, Actual amount secured with guarantor provided company to parent Mainland Number guarantor Company name （Note 1） （Note 2） the year 2020 drawn down collateral company （Note 2） subsidiary company China Footnote 0 ScinoPharm SciAnda 1 $ 10,529,403 $ 2,089,077 $ 1,005,928 $ - $ - 9.55% $ 10,529,403 Y N Y － Taiwan, (Changshu) Ltd. Pharmaceuticals, Ltd.

Note 1: The following code represents the relationship with the Company:

1. A company in which the Company directly and indirectly holds 50% of the voting shares.

2. Note 2: 1. The limit of total amount of endorsement is 50% of the Company's net worth, for 100% directly or indirectly owned subsidiaries, the maximum amount is 100% of its net worth.

3. The limit of total amount of the Group's endorsement and guarantee is 100% of the Group's net worth.

4. For any endorsement or guarantee provided by the Company due to business dealings, the amount of endorsement or guarantees shall be limited to the business dealing amount of the most recent year or the current year. The business dealing amount is product purchase or sale amount between the entities, whichever is higher.

Note 3: The numbers in the table that involves foreign currencies are expressed in New Taiwan Dollars according to the exchange rate posted on the date of the consolidated financial statements (CNY:NTD 1:4.363；USD:NTD 1:28.48).

Table 2, Page 1

ScinoPharm Taiwan, Ltd. and Subsidiaries

Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures) December 31, 2020

			December 31,	2020
Table 3 Securities held by	Marketable securities	Relationship with the securities issuer	General ledger account		As of December31,2020		Fairvalue Footnote Expressed in thousands of NTD
				Number of shares	Bookvalue	Ownership (%)	Fairvalue
ScinoPharm Taiwan, Ltd.	Stocks: Tanvex Biologics, Inc. Foresee Pharmaceuticals Co., Ltd. SYNGEN, INC.	The Company is a director of Tanvex Biologics, Inc. － －	Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through profit or loss - non-current	28,800,000 2,100,000 245,000	119,955 $ 188,160 -	16.84% 2.06% 7.40%	119,955 $ 188,160 -	－ － －

Table 3, Page 1

' - Acquisition or sale of the same security with the accumulated cost exceeding $300 million or 20% of the Company s paid in capital For the year ended December 31, 2020

ScinoPharm Taiwan, Ltd. and Subsidiaries

Table 4 Investor	Type of securities	General ledgeraccount	Name of the counterparty	Relationship	Beginningbalance	Beginningbalance	Addition	Addition		Disposal	Disposal		Other increase	(decrease)	Expressed in thousands of NTD Endingbalance	Expressed in thousands of NTD Endingbalance
					Number of shares (inthousands)	Amount	Number of shares (inthousands)	Amount	Number of shares (inthousands)	Saleprice	Book value	Gain on disposal	Number of shares (inthousands)	Amount	Number of shares (inthousands)	Amount
SciAnda (Kunshan) Biochemical Technology, Ltd.(Note) SciAnda (Changshu) Pharmaceuticals, Ltd.	Fubon Bank (China) Co., Ltd. Structured Products Fubon Bank (China) Co., Ltd. Structured Products Structured Products:	Financial assets at amortised cost - current Financial assets at amortised cost - current	－ －	－ －	- -	172,220 $ -	- -	171,259 $ 436,711 $	- -	343,854 $ 438,430 $	342,519) ($ 436,711) ($	1,335 $ 1,719 $	- -	960) ($ -	- -	- -

Note: SciAnda (Kunshan) Biochemical Technology, Ltd. was merged into SciAnda (Changshu) Pharmaceuticals, Ltd. in August 2020.

Table 4, Page 1

Table 5

Expressed in thousands of NTD

ScinoPharm Taiwan, Ltd. and Subsidiaries

• Purchases or sales of goods from or to related parties reaching $100 million or 20% of paid in capital or more For the year ended December 31, 2020

Purchaser/seller	Counterparty	Relationship with the counterparty			Transaction		Differences in transaction terms compared to third party transactions	Differences in transaction terms compared to third party transactions	Notes/accounts receivable(payable)	Notes/accounts receivable(payable)	Footnote
			Purchases(sales)	Amount	Percentage of total purchases(sales)	Credit term	Unitprice	Credit term	Balance	Percentage of total notes/accounts receivable(payable)
ScinoPharmTaiwan, Ltd. SciAnda (Changshu) Pharmaceuticals, Ltd.	SciAnda (Changshu) Pharmaceuticals, Ltd. ScinoPharm Taiwan, Ltd.	Subsidary The Company	Purchases (Sales)	387,725 $ 387,725) (	42% (88%)	Closes its accounts 90 days from the end of each month Closes its accounts 90 days from the end of each month	$ - -	－ －	36,565) ($ 36,565	(22%) 84%	－ －

Table 5, Page 1

Table 6

Expressed in thousands of NTD

ScinoPharm Taiwan, Ltd. and Subsidiaries

- Significant inter company transactions during the reporting period

For the year ended December 31, 2020

Number (Note 2)	Companyname	Counterparty	Relationship (Note3)		Transactions	Transactions
				General ledger account	Amount	Transaction terms	Percentage of consolidated total operating revenues or total assets(Note 4)
0 0 0 0 0 0	ScinoPharm Taiwan, Ltd. ScinoPharm Taiwan, Ltd. ScinoPharm Taiwan, Ltd. ScinoPharm Taiwan, Ltd. ScinoPharm Taiwan, Ltd. ScinoPharm Taiwan, Ltd.	SciAnda (Changshu) Pharmaceuticals, Ltd. SciAnda (Changshu) Pharmaceuticals, Ltd. SciAnda (Changshu) Pharmaceuticals, Ltd. SciAnda (Changshu) Pharmaceuticals, Ltd. SciAnda (Changshu) Pharmaceuticals, Ltd. SciAnda Shanghai Biochemical Technology, Ltd.	1 1 1 1 1 1	Purchases Management service revenue Sales Accounts payable Endorsements and guarantees Management service fees	387,725 $ 13,138 13,451 36,565 1,005,928 10,750	Closes its accounts 90 days from the end of each month － Closes its accounts 90 days from the end of each month － － －	13% － － － 8% －

Note 1: Significant inter-company transactions during the reporting periods are not disclosed since these were corresponding transactions. Only transactions over NT$10 million are material.

Note 2: The numbers filled in for the transaction company in respect of inter-company transactions are as follows:

• (1) Parent company is ‘0’.

(2) The subsidiaries are numbered in order starting from ‘1’.

• Note 3: Relationship between transaction company and counterparty is classified into the following three categories:

(1) Parent company to subsidiary.

(2) Subsidiary to parent company.

(3) Subsidiary to subsidiary.

Note 4: Regarding percentage of transaction amount to consolidated total operating revenues or total assets, it is computed based on period-end balance of transaction to consolidated total assets for balance sheet accounts and based on accumulated transaction amount for the period to consolidated total operating revenues for income statement accounts.

Note 5: The numbers in the table that involves foreign currencies are expressed in New Taiwan Dollars according to the exchange rate posted on the date of the consolidated financial statements (CNY:NTD 1:4.363 ； USD:NTD 1:28.48).

Table 6, Page 1

ScinoPharm Taiwan, Ltd. and Subsidiaries

Names, locations and other information of investee companies ( not including investees in Mainland China) For the year ended December 31, 2020

Table 7

Expressed in thousands of NTD

Investor	Investee	Location	Main business activities	Initial investment amount	Initial investment amount	Shares held	as at December31,2020	as at December31,2020	Net profit (loss) of the investee for the year ended December31,2020	Investment income (loss) recognised by the Company for the year ended December31,2020	Footnote
				Balance as at December31,2020	Balance as at December31,2019	Number of shares	Ownership (%)	Bookvalue
ScinoPharm Taiwan, Ltd. ScinoPharm Taiwan, Ltd.	SPT International, Ltd. ScinoPharm Singapore Pte Ltd.	Tortola, British Virgin Islands Singapore	Professional investment Professional investment	3,375,582 $ -	3,375,582 $ -	118,524,644 2	100.00 100.00	1,680,970 $ 125	101,127) ($ 13	104,633) ($ 13	Subsidiary Subsidiary

Note : Initial investment amount in the table that involves foreign currencies are expressed in New Taiwan Dollars according to exchange rate posted on the date of consolidated financial statements (USD:NTD 1:28.48).

Table 7, Page 1

ScinoPharm Taiwan, Ltd. and Subsidiaries

For the year ended December 31, 2020

Table 8

Expressed in thousands of NTD

Information on investments in Mainland China － Basic information

Investee in MainlandChina	Main business activities	Paid-in capital	Investment method	Accumulated amount of remittance from Taiwan to Mainland China as of January 1, 2020	Amount remitted from Taiwan to Mainland China/ Amount remitted back to Taiwan for the year ended December31,2020	Amount remitted from Taiwan to Mainland China/ Amount remitted back to Taiwan for the year ended December31,2020	Accumulated amount of remittance from Taiwan to Mainland China as of December31,2020	Net income of investee for the year ended December 31, 2020	Ownership held by the Company (direct or indirect)	Investment income (loss) recognised by the Company for the year ended December 31, 2020 （Note 2）	Book value of investments in Mainland China as of December 31, 2020	Accumulated amount of investment income remitted back to Taiwan as of December 31, 2020	Footnote
					Remitted to MainlandChina	Remitted back to Taiwan
SciAnda (Changshu) Pharmaceuticals, Ltd. SciAnda Shanghai Biochemical Technology, Ltd.	Research, development, and manufacture of API and new drugs, sale produced products, etc. Import, export and sales of API and intermediates, etc.	3,317,920 $ 34,176	（Note 1） （Note 1）	3,310,071 $ 34,176	- $ -	- $ -	3,310,071 $ 34,176	100,904) ($ 37	100% 100%	100,904) ($ 37	1,725,768 $ 16,207	- $ -	Subsidary (Note 5) Subsidary

Accumulated amount of Investment amount approved Ceiling on investments in remittance from Taiwan by the Investment Commission Mainland China imposed by the to Mainland China of the Ministry of Economic Investment Commission of Company name as of December 31, 2020 Affairs (MOEA) MOEA (Note 3) ScinoPharm $ 3,379,110 $ 3,379,110 $ 6,317,642 Taiwan, Ltd.

Note 1: Indirect investment in Mainland China through a company set up in a third region, SPT International, Ltd.

Note 2: The investment income (loss) recognised by the Company for the year ended December 31, 2020 was based on audited financial statements of investee companies as of and for the year ended December 31, 2020. Note 3: The ceiling amount is 60% of the higher of net worth or consolidated net worth.

Note 4: The numbers in the table that involves foreign currencies are expressed in New Taiwan Dollars according to the exchange rate posted on the date of the consolidated financial statements (USD:NTD 1:28.48). Note 5: SciAnda (Kunshan) Biochemical Technology, Ltd. was merged into SciAnda (Changshu) Pharmaceuticals, Ltd. in August 2020.

Table 8, Page 1

ScinoPharm Taiwan, Ltd. and Subsidiaries Major shareholders information December 31, 2020

Name of the keyshareholder Table 9	Number of	shares	Ownership (%)	Footnote Expressed in shares
	Common stock	Preferred stock
Uni-President Enterprises Corp. National Development Fund, Executive Yuan	299,968,639 109,539,014	－ －	37.94% 13.85%	－ －

Note: The major shareholders information was derived from the data that the Company issued common shares (including treasury shares) and preference shares in dematerialised form which were registered and held by the shareholders above 5% on the last operating date of each quarter and was calculated by Taiwan Depository & Clearing Corporation.

The share capital which was recorded in the financial statements is different from the actual number of shares issued in dematerialised form because of the difference in the calculation basis.

Table 9, Page 1

Appendix B

SCINOPHARM TAIWAN, LTD.

PARENT COMPANY ONLY FINANCIAL

STATEMENTS AND INDEPENDENT AUDITORS’

REPORT

DECEMBER 31, 2020 AND 2019

~1~

INDEPENDENT AUDITORS’ REPORT TRANSLATED FROM CHINESE

To the Board of Directors and Shareholders of ScinoPharm Taiwan, Ltd.

Opinion

We have audited the accompanying parent company only balance sheets of ScinoPharm Taiwan, Ltd. (the “Company”) as at December 31, 2020 and 2019, and the related parent company only statements of comprehensive income, of changes in equity and of cash flows for the years then ended, and notes to the parent company only financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying parent company only financial statements present fairly, in all material respects, the financial position of the Company as at December 31, 2020 and 2019, and its financial performance and its cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and generally accepted auditing standards in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ responsibilities for the audit of the parent company only financial statements section of our report. We are independent of the Company in accordance with the Norm of professional Ethics for Certified Public Accountants in the Republic of China, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Company’s 2020 parent company only financial statements. These matters were addressed in the context of our audit of the parent company only financial statements as a whole and, in forming our opinion thereon, we do not provide a separate opinion on these matters.

~2~

The key audit matters for the Company’s 2020 parent company only financial statements are stated as follows:

Cutoff of export revenue

Description

Refer to Note 4(28) for accounting policy on revenue recognition and Note 6(18) for accounting items on revenue.

The Company’s sales revenue mainly arises from the manufacture and sales of Active Pharmaceutical Ingredient (“API”), which primarily consists of export sales. The Company recognises export sales revenue based on the terms and conditions of transactions which vary with different customers. As revenue recognition involves manual processes and is material to the financial statements, we consider the cutoff of export revenue a key audit matter.

How our audit addressed the matter

We performed the following key audit procedures in response to the above key audit matter:

1. Understood and assessed the effectiveness of internal controls over cutoff of sales revenue and tested the effectiveness of internal controls over shipping and billing.

2. Checked the completeness of the export sales details for a certain period around balance sheet date and performed cutoff tests on a random basis, which included checking the terms and conditions of transactions, verifying against supporting documents, and checking whether inventory movements and costs of sales were recognised in the appropriate period.

Inventory valuation

Description

Refer to Note 4(11) for accounting policies on inventory valuation, Note 5(2)1 for the uncertainty of accounting estimates and assumptions applied in inventory valuation, and Note 6(4) for details of inventories. As at December 31, 2020, the balances of inventory and allowance for inventory valuation losses were $1,448,766 thousand and $313,819 thousand, respectively.

~3~

The Company is primarily engaged in the manufacture and sales of API. As the manufacturing process is relatively complicated and time-consuming, materials require longer lead time, the waiting period for product registration is long, and the timing of the product launch may be deferred, there is higher risk of incurring loss on inventory valuation. For inventories sold under normal terms, the Company measures inventories at the lower of cost and net realisable value. For inventories aging over a certain period of time and are individually identified as obsolete inventories, the net realisable value is calculated based on the historical information of inventory turnover. Since the calculation of net realisable value involves subjective judgement and the ending balance of inventory is material to the financial statements, we consider the valuation of inventory a key audit matter.

How our audit addressed the matter

We performed the following key audit procedures in response to the above key audit matter:

1. Evaluated the reasonableness of provision policies and procedures on allowance for inventory valuation losses, including the historical data of inventory turnover and judgement of obsolete inventory.

2. Verified whether the dates used in the inventory aging reports that the Company applied to value inventories were accurate. Recalculated and evaluated the reasonableness of allowance for inventory valuation losses in order to confirm whether the reported information was in line with the Company’s policies.

3. Selected samples from inventory items by each sequence number to verify its realisable value and to evaluate the reasonableness of allowance for inventory valuation loss.

Responsibilities of management and those charged with governance for the parent company only financial statements

Management is responsible for the preparation and fair presentation of the parent company only financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and for such internal control as management determines is necessary to enable the preparation of parent company only financial statements that are free from material misstatement, whether due to fraud or error.

~4~

In preparing the parent company only financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance, including audit committee, are responsible for overseeing the Company’s financial reporting process.

Auditors’ responsibilities for the audit of the parent company only financial statements

Our objectives are to obtain reasonable assurance about whether the parent company only financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the generally accepted auditing standards in the Republic of China will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these parent company only financial statements.

As part of an audit in accordance with the generally accepted auditing standards in the Republic of China, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

1. Identify and assess the risks of material misstatement of the parent company only financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

2. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.

3. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

~5~

1. Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the parent company only financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Company to cease to continue as a going concern.

2. Evaluate the overall presentation, structure and content of the parent company only financial statements, including the disclosures, and whether the parent company only financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

3. Obtain sufficient appropriate audit evidence regarding the financial information of the Company to express an opinion on the parent company only financial statements. We are responsible for the direction, supervision and performance of the audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

~6~

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the parent company only financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Lin, Yung-Chih

Independent Accountants

Liu, Tzu-Meng

PricewaterhouseCoopers, Taiwan Republic of China March 18, 2021

------------------------------------------------------------------------------------------------------------------------------------------------The accompanying parent company only financial statements are not intended to present the financial position and results of operations and cash flows in accordance with accounting principles generally accepted in countries and jurisdictions other than the Republic of China. The standards, procedures and practices in the Republic of China governing the audit of such financial statements may differ from those generally accepted in countries and jurisdictions other than the Republic of China. Accordingly, the accompanying parent company only financial statements and report of independent accountants are not intended for use by those who are not informed about the accounting principles or auditing standards generally accepted in the Republic of China, and their applications in practice.

As the financial statements are the responsibility of the management, PricewaterhouseCoopers cannot accept any liability for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the translation.

~7~

SCINOPHARM TAIWAN, LTD. PARENT COMPANY ONLY BALANCE SHEETS DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars)

Assets	Notes 6(1) 6(2) 6(3) and 12 7 6(25) 5 and 6(4) 6(5) 6(6) 6(7)(9) 6(8) 6(25) 8	December 31, 2020 AMOUNT % $ 3,879,691 33 - - 379,411 3 17,569 - 6,348 - 8,969 - 1,134,947 10 96,841 1 5,523,776 47 308,115 3 1,681,095 14 3,053,564 26 559,847 5 6,885 - 505,018 4 108,322 1 1,029 - 29,270 - 6,253,145 53 $ 11,776,921 100	December 31, 2019	December 31, 2019
		AMOUNT $ 3,879,691 - 379,411 17,569 6,348 8,969 1,134,947 96,841 5,523,776 308,115 1,681,095 3,053,564 559,847 6,885 505,018 108,322 1,029 29,270 6,253,145 $ 11,776,921	AMOUNT $ 3,020,410 2,920 562,856 10,118 5,697 8,969 1,100,695 107,502 4,819,167 415,210 1,763,209 3,192,172 602,221 9,458 504,946 80,441 5,244 29,270 6,602,171 $ 11,421,338	%
Current assets 1100 Cash and cash equivalents 1110 Financial assets at fair value through profit or loss - current 1170 Accounts receivable, net 1200 Other receivables 1210 Other receivables - related parties 1220 Current income tax assets 130X Inventories 1410 Prepayments 11XX Total current assets Non-current assets 1517 Financial assets at fair value through other comprehensive income - non-current 1550 Investments accounted for using equity method 1600 Property, plant and equipment 1755 Right-of-use assets 1780 Intangible assets 1840 Deferred income tax assets 1915 Prepayments for equipment 1920 Guarantee deposits paid 1980 Other financial assets - non-current 15XX Total non-current assets 1XXX Total assets				26 - 5 - - - 10 1
				42
				4 16 28 5 - 4 1 - -
				58
				100

(Continued)

~8~

SCINOPHARM TAIWAN, LTD. PARENT COMPANY ONLY BALANCE SHEETS DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars)

Liabilities and Equity

December 31, 2020 December 31, 2019 Notes AMOUNT % AMOUNT % 6(10) $ 9,494 - $ - - 6(2) 2,172 - - - 6(18) 47,518 - 46,789 - 1,173 - 1,353 - 126,820 1 93,643 1 7 36,598 - 45,517 - 6(11) 308,560 3 285,292 3 6(25) 67,969 1 - - 16,500 - 16,014 - 616,804 5 488,608 4 6(25) - - 584 - 550,182 5 590,020 5 6(12) 79,232 1 82,182 1 1,300 - - - 630,714 6 672,786 6 1,247,518 11 1,161,394 10 6(13) 7,907,392 67 7,907,392 69 6(14)(15) 1,294,689 11 1,294,605 12 6(5)(16) 634,265 5 612,600 6 67,825 1 22,829 - 658,275 6 490,344 4 6(6)(17) ( 33,043) ( 1) ( 67,826) ( 1 ) 10,529,403 89 10,259,944 90 7 and 9 $ 11,776,921 100 $ 11,421,338 100

Current liabilities 2100 Short-term borrowings 2120 Current financial liabilities at fair value through profit or loss - current 2130 Contract liabilities - current 2150 Notes payable 2170 Accounts payable 2180 Accounts payable - related parties 2200 Other payables 2230 Current income tax liabilities 2280 Lease liabilities - current 21XX Total current liabilities Non-current liabilities 2570 Deferred income tax liabilities 2580 Lease liabilities - non-current 2640 Net defined benefit liabilities 2645 Guarantee deposits received 25XX Total non-current liabilities 2XXX Total liabilities Equity Share capital 3110 Common stock 3200 Capital surplus Retained earnings 3310 Legal reserve 3320 Special reserve 3350 Unappropriated earnings 3400 Other equity interest 3XXX Total equity Significant contingent liabilities and unrecognised contract commitments 3X2X Total liabilities and equity

The accompanying notes are an integral part of these parent company only financial statements.

~9~

SCINOPHARM TAIWAN, LTD. PARENT COMPANY ONLY STATEMENTS OF COMPREHENSIVE INCOME YEARS ENDED DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars, except earnings per share amounts)

Items

Year ended December 31 2020 2019 Notes AMOUNT % AMOUNT % 6(18) and 7 $ 3,046,220 100 $ 2,813,047 100 6(4)(12)(23)(24) and 7 ( 1,758,472) ( 58) ( 1,677,387) ( 59) 1,287,748 42 1,135,660 41 6(12)(23)(24), 7 and 12 ( 175,267) ( 5) ( 160,552) ( 6) ( 455,460) ( 15) ( 446,039) ( 16) ( 206,364) ( 7) ( 206,570) ( 7) 197 - ( 202) - ( 836,894) ( 27) ( 813,363) ( 29) 450,854 15 322,297 12 6(19) 21,043 - 28,541 1 6(20) and 7 29,164 1 66,295 2 6(2)(9)(21) and 12( 36,487) ( 1) ( 44,362) ( 2) 6(8)(22) ( 7,072) - ( 8,532) - 6(6) ( 104,620) ( 4) ( 117,725) ( 4) ( 97,972) ( 4) ( 75,783) ( 3) 352,882 11 246,514 9 6(25) ( 70,815) ( 2) ( 29,858) ( 1) $ 282,067 9 $ 216,656 8 6(12) $ 2,369 - ($ 5,936) - 6(5)(17) 176,406 6 ( 48,718) ( 2) 6(25) ( 473) - 1,187 - 6(6)(17) 22,506 1 ( 56,865) ( 2) $ 200,808 7 ($ 110,332) ( 4) $ 482,875 16 $ 106,324 4 6(26) $ 0.36 $ 0.27 $ 0.36 $ 0.27

4000 Operating revenue 5000 Operating costs 5900 Net operating margin Operating expenses 6100 Selling expenses 6200 General and administrative expenses 6300 Research and development expenses 6450 Gain on reversal of (expected credit losses) 6000 Total operating expenses 6900 Operating profit Non-operating income and expenses 7100 Interest income 7010 Other income 7020 Other gains and losses 7050 Finance costs 7070 Share of loss of associates and joint ventures accounted for using equity method 7000 Total non-operating income and expenses 7900 Profit before income tax 7950 Income tax expense 8200 Profit for the year Other comprehensive income (loss) Components of other comprehensive income (loss) that will not be reclassified to profit or loss 8311 Actuarial (gains) losses on defined benefit plans 8316 Unrealised (gains) losses from equity instruments measured at fair value through other comprehensive income 8349 Income tax related to components of other comprehensive income that will not be reclassified to profit or loss Components of other comprehensive income (loss) that will be reclassified to profit or loss 8361 Financial statements translation differences of foreign operations 8300 Total other comprehensive income (loss) for the year 8500 Total comprehensive income for the year Earnings per share (in dollars) 9750 Basic 9850 Diluted

The accompanying notes are an integral part of these parent company only financial statements.

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SCINOPHARM TAIWAN, LTD. PARENT COMPANY ONLY STATEMENTS OF CHANGES IN EQUITY YEARS ENDED DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars)

Year ended December 31, 2019 Balance at January 1, 2019 Net income for the year Other comprehensive loss for the year Total comprehensive income (loss) for the year Distribution of 2018 net income: Legal reserve Cash dividends Employee stock option compensation cost Disposal of equity instruments at fair value through other comprehensive income Balance at December 31, 2019 Year ended December 31, 2020 Balance at January 1, 2020 Net income for the year Other comprehensive income for the year Total comprehensive income Distribution of 2019 net income: Legal reserve Special reserve Cash dividends Employee stock option compensation cost Disposal of equity instruments at fair value through other comprehensive income Balance at December 31, 2020	Notes	S	hare capital - common stock		Capital reserve				Retained Earnings			Other Equity Interest	Other Equity Interest		Total equity
							Legal reserve		Special reserve		Unappropriated earnings	Financial statements translation differences of foreign operations	Unrealised gains (losses) from financial assets measured at fair value through other comprehensive income
	6(5)(6)(17) 6(16) 6(14)(15) 6(5)(17) 6(5)(6)(17) 6(16) 6(14)(15) 6(5)(17)		$ 7,907,392 - - - - - - - $ 7,907,392 $ 7,907,392 - - - - - - - - $ 7,907,392		$ 1,292,555 - - - - - 2,050 - $ 1,294,605 $ 1,294,605 - - - - - - 84 - $ 1,294,689		$ 568,302 - - - 44,298 - - - $ 612,600 $ 612,600 - - - 21,665 - - - - $ 634,265		$ 22,829 - - - - - - - $ 22,829 $ 22,829 - - - - 44,996 - - - $ 67,825	$ 708,338 216,656 ( 4,749 ) 211,907 ( 44,298 ) ( 387,462 ) - 1,859 $ 490,344 $ 490,344 282,067 1,896 283,963 ( 21,665 ) ( 44,996 ) ( 213,500 ) - 164,129 $ 658,275		($ 41,252 ) - ( 56,865 ) ( 56,865 ) - - - - ($ 98,117 ) ($ 98,117 ) - 22,506 22,506 - - - - - ($ 75,611 )	$ 80,868 - ( 48,718 ) ( 48,718 ) - - - ( 1,859 ) $ 30,291 $ 30,291 - 176,406 176,406 - - - - ( 164,129 ) $ 42,568	$ 10,539,032 216,656 ( 110,332 ) 106,324 - ( 387,462 ) 2,050 - $ 10,259,944 $ 10,259,944 282,067 200,808 482,875 - - ( 213,500 ) 84 - $ 10,529,403

The accompanying notes are an integral part of these parent company only financial statements.

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SCINOPHARM TAIWAN, LTD. PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars)

CASH FLOWS FROM OPERATING ACTIVITIES Profit before tax Adjustments Adjustments to reconcile profit (loss) Loss (gain) on valuation of financial assets and liabilities at fair value through profit or loss (Gain on reversal of) expected credit losses Reversal of allowance for loss on inventory market price decline Provision for obsolescence of supplies Share of loss of subsidiaries, associates and joint ventures accounted for using equity method Depreciation of property, plant and equipment Depreciation of right-of-use assets Property, plant and equipment transferred to loss Gain on disposal of property, plant and equipment (Gain on reversal of) impairment loss Amortisation Prepayments for equipment transferred to loss Employee stock option compensation cost Interest income Interest expense Changes in operating assets and liabilities Changes in operating assets Accounts receivable Other receivables Other receivables - related parties Inventories Prepayments Changes in operating liabilities Contract liabilities - current Notes payable Accounts payable Accounts payable - related parties Other payables Net defined benefit liabilities - non-current Cash inflow generated from operations Interest received Interest paid Income tax paid Net cash flows from operating activities

YearendedDecember 31 Notes 2020 2019 $ 352,882 $ 246,514 5,092 ( 2,511 ) 12 ( 197 ) 202 6(4) ( 74,623 ) ( 2,590 ) 3,312 5,972 6(6) 104,620 117,725 6(7)(23) 266,984 272,707 6(8)(23) 12,794 15,148 6(7)(21) 11,900 22,726 6(21) 2,587 - 6(7)(9)(21) ( 4,253 ) 707 6(23) 6,044 7,693 - 1,967 6(14)(15) 84 2,050 6(19) ( 21,043 ) ( 28,541 ) 6(22) 7,072 8,532 183,642 ( 12,318 ) ( 6,147 ) 5,481 ( 651 ) ( 72 ) 40,371 145,483 7,349 ( 33,201 ) 729 24,248 ( 180 ) 205 33,177 19,904 ( 8,919 ) 6,210 11,456 ( 16,561 ) ( 581 ) ( 617 ) 933,501 807,063 19,739 28,599 ( 7,072 ) ( 9,410 ) ( 3,975 ) ( 136,614 ) 942,193 689,638

(Continued)

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SCINOPHARM TAIWAN, LTD. PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars)

CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from disposal of financial assets at fair value through other comprehensive income Acquisition of investments accounted for using equity method - subsidiary Cash paid for acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Acquisition of intangible assets Increase in prepayments for equipment Decrease (increase) in guarantee deposits paid Net cash flows from (used in) investing activities CASH FLOWS FROM FINANCING ACTIVITIES Increase (decrease) in short-term borrowings Repayment of the principal portion of lease liabilities Increase (decrease) in guarantee deposits received Payment of cash dividends Net cash flows used in financing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year

YearendedDecember 31 Notes 2020 2019 6(5) $ 283,501 $ 4,189 6(6) - ( 1,192,251 ) 6(27) ( 64,529 ) ( 15,925 ) 124 - ( 2,310 ) ( 2,249 ) ( 91,435 ) ( 71,998 ) 4,215 ( 4,341 ) 129,566 ( 1,282,575 ) 6(28) 9,494 ( 61,694 ) 6(28) ( 9,772 ) ( 11,335 ) 6(28) 1,300 ( 1,618 ) 6(16) ( 213,500 ) ( 387,462 ) ( 212,478 ) ( 462,109 ) 859,281 ( 1,055,046 ) 6(1) 3,020,410 4,075,456 6(1) $ 3,879,691 $ 3,020,410

The accompanying notes are an integral part of these parent company only financial statements.

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SCINOPHARM TAIWAN, LTD.

NOTES TO THE PARENT COMPANY ONLY FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)

1. HISTORY AND ORGANISATION

• (1) ScinoPharm Taiwan, Ltd. (the Company) was incorporated as a company limited by shares under the provisions of the Company Act of the Republic of China (R.O.C.) on November 11, 1997. The Company is primarily engaged in the manufacture of western medicines and other chemical materials, biological technology services, intellectual property rights, international trade and research, development and manufacture of Active Pharmaceutical Ingredients (API), albumin medicines, oligonucleotide medicines, peptide medicines, injections and new small molecule drugs, as well as the provision of related consulting and technical services.

• (2) The common shares of the Company have been listed on the Taiwan Stock Exchange since September 2011.

• (3) Uni-President Enterprises Corp., the Company’s ultimate parent company, holds 37.94% equity interest in the Company.

• THE DATE OF AUTHORISATION FOR ISSUANCE OF THE PARENT COMPANY ONLY

• FINANCIAL STATEMENTS AND PROCEDURES FOR AUTHORISATION

• These parent company only financial statements were authorised for issuance by the Board of Directors on March 18, 2021.

• APPLICATION OF NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS

• (1) Effect of the adoption of new issuances of or amendments to International Financial Reporting Standards (“IFRS”) as endorsed by the Financial Supervisory Commission (“FSC”) New standards, interpretations and amendments endorsed by the FSC effective from 2020 are as follows:

follows:
New Standards,Interpretations andAmendments	Effective date by International Accounting StandardsBoard
Amendments to IAS 1 and IAS 8, ‘Disclosure initiative-definition of material’ Amendments to IFRS 3, ‘Definition of a business’ Amendments to IFRS 9, IAS 39 and IFRS 7, ‘Interest rate benchmark reform’ Amendment to IFRS 16, ‘Covid-19-related rent concessions’ Note: Earlier application from January 1, 2020 is allowed by the FSC.	January 1, 2020 January 1, 2020 January 1, 2020 June 1, 2020 (Note)

The above standards and interpretations have no significant impact to the Company’s financial condition and financial performance based on the Company’s assessment.

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(2) Effect of new issuances of or amendments to IFRSs as endorsed by the FSC but not yet adopted by

the Group

New standards, interpretations and amendments endorsed by the FSC effective from 2021 are as follows:

Effect of new issuances of or amendments to IFRSs as endorsed by the the Group New standards, interpretations and amendments endorsed by the FSC follows:	FSC but not yet adopted by effective from 2021 are as
	Effective date by
	International Accounting
New Standards, Interpretations and Amendments	StandardsBoard
Amendments to IFRS 4, ‘Extension of the temporary exemption from	January 1, 2021
applying IFRS 9’
Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16,	January 1, 2021
‘Interest Rate Benchmark Reform— Phase 2’

The above standards and interpretations have no significant impact to the Company’s financial condition and financial performance based on the Company’s assessment.

(3) IFRSs issued by IASB but not yet endorsed by the FSC

New standards, interpretations and amendments issued by IASB but not yet included in the IFRSs as endorsed by the FSC are as follows:

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Effective date by
International Accounting
New Standards, Interpretations and Amendments Standards Board
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New Standards, Interpretations and Amendments	Effective date by International Accounting StandardsBoard
Amendments to IFRS 3, ‘Reference to the conceptual framework’	January 1, 2022
Amendments to IFRS 10 and IAS 28, ‘Sale or contribution of assets	To be determined by
between an investor and its associate or joint venture’	International Accounting
	Standards Board
IFRS 17, ‘Insurance contracts’	January 1, 2023
Amendments to IFRS 17, ‘Insurance contract’	January 1, 2023
Amendments to IAS 1, ‘Classification of liabilities as current or	January 1, 2023
non-current’
Amendments to IAS 1, ‘Disclosure of accounting policies’	January 1, 2023
Amendments to IAS 8, ‘Definition of accounting estimates’	January 1, 2023
Amendments to IAS 16, ‘Property, plant and equipment: proceeds before	January 1, 2022
intended use’
Amendments to IAS 37, ‘Onerous contracts—cost of fulfilling a contract’	January 1, 2022
Annual improvements to IFRS Standards 2018–2020	January 1, 2022

The above standards and interpretations have no significant impact to the Company’s financial condition and financial performance based on the Company’s assessment.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of these parent company only financial statements are set out below. These policies have been consistently applied to all the periods presented, unless otherwise stated.

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(1) Compliance statement

The parent company only financial statements of the Company have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

• (2) Basis of preparation

• A. Except for the following items, these parent company only financial statements have been prepared under the historical cost convention:

  • (a) Financial assets and financial liabilities (including derivative instruments) at fair value through profit or loss.

  • (b) Financial assets at fair value through other comprehensive income.

  • (c) Defined benefit liabilities recognised based on the net amount of pension fund assets less present value of defined benefit obligation.

• B. The preparation of financial statements in conformity with International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretation as endorsed by the FSC (collectively referred herein as the “IFRSs”) requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Company’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the parent company only financial statements are disclosed in Note 5.

(3) Foreign currency translation

Items included in the parent company only financial statements of the Company are measured using the currency of the primary economic environment in which the Company operates (the “functional currency”). The parent company only financial statements are presented in NTD, which is the Company’s functional and presentation currency.

• A. Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where items are remeasured. Foreign exchange gains and losses resulting from the settlement of such transactions are recognised in profit or loss in the period in which they arise.

• B. Monetary assets and liabilities denominated in foreign currencies at the period end are re-translated at the exchange rates prevailing at the balance sheet date. Exchange differences arising upon retranslation at the balance sheet date are recognised in profit or loss.

• C. Non-monetary assets and liabilities denominated in foreign currencies held at fair value through profit or loss are re-translated at the exchange rates prevailing at the balance sheet date; their translation differences are recognised in profit or loss. Non-monetary assets and liabilities denominated in foreign currencies held at fair value through other comprehensive income are retranslated at the exchange rates prevailing at the balance sheet date; their translation differences are recognised in other comprehensive income. However, non-monetary assets and liabilities denominated in foreign currencies that are not measured at fair value are translated using the historical exchange rates at the dates of the initial transactions.

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• D. All foreign exchange gains and losses based on the nature of those transactions are presented in the statement of comprehensive income within “other gains and losses”.

• (4) Classification of current and non-current items

• A. Assets that meet one of the following criteria are classified as current assets; otherwise they are classified as non-current assets:

  • (a) Assets arising from operating activities that are expected to be realised, or are intended to be sold or consumed within the normal operating cycle;

  • (b) Assets held mainly for trading purposes;

  • (c) Assets that are expected to be realised within twelve months from the balance sheet date;

  • (d) Cash and cash equivalents, excluding restricted cash and cash equivalents and those that are to be exchanged or used to pay off liabilities more than twelve months after the balance sheet date.

• B. Liabilities that meet one of the following criteria are classified as current liabilities; otherwise they are classified as non-current liabilities:

  • (a) Liabilities that are expected to be paid off within the normal operating cycle;

  • (b) Liabilities arising mainly from trading activities;

  • (c) Liabilities that are to be paid off within twelve months from the balance sheet date;

  • (d) Liabilities for which the repayment date cannot be extended unconditionally to more than twelve months after the balance sheet date. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

• (5) Cash equivalents

• A. Cash equivalents refer to short-term highly liquid investments that are readily convertible to known amount of cash and subject to an insignificant risk of changes in value.

• B. Time deposits and bills under repurchase agreements that meet the above criteria and are held for the purpose of meeting short-term cash commitment in operations are classified as cash equivalents.

• (6) Financial assets at fair value through profit or loss

• A. Financial assets at fair value through profit or loss are financial assets that are not measured at amortised cost or fair value through other comprehensive income.

• B. On a regular way purchase or sale basis, financial assets at fair value through profit or loss are recognised and derecognised using trade date accounting.

• C. At initial recognition, the Company measures the financial assets at fair value and recognises the transaction costs in profit or loss. The Company subsequently measures the financial assets at fair value, and recognises the gain or loss in profit or loss.

• D. The Company recognises the dividend income when the right to receive payment is established, future economic benefits associated with the dividend will flow to the Company and the amount of the dividend can be measured reliably.

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(7) Financial assets at fair value through other comprehensive income

• A. Financial assets at fair value through other comprehensive income comprise equity securities which are not held for trading, and for which the Company has made an irrevocable election at initial recognition to recognise changes in fair value in other comprehensive income.

• B. On a regular way purchase or sale basis, financial assets at fair value through other comprehensive income are recognised and derecognised using trade date accounting.

• C. At initial recognition, the Company measures the financial assets at fair value plus transaction costs. The Company subsequently measures the financial assets at fair value. The changes in fair value of equity investments that were recognised in other comprehensive income are reclassified to retained earnings and are not reclassified to profit or loss following the derecognition of the investment. Dividends are recognised as revenue when the right to receive payment is established, future economic benefits associated with the dividend will flow to the Company and the amount of the dividend can be measured reliably.

• (8) Accounts and notes receivable

• A. Accounts and notes receivable entitle the Company a legal right to receive consideration in exchange for transferred goods or rendered services.

• B. The short-term accounts and notes receivable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.

• (9) Impairment of financial assets

For financial assets at amortised cost, at each reporting date, the Company recognises the impairment provision for 12 months expected credit losses if there has not been a significant increase in credit risk since initial recognition or recognises the impairment provision for the lifetime expected credit losses (ECLs) if such credit risk has increased since initial recognition after taking into consideration all reasonable and verifiable information that includes forecasts. On the other hand, for accounts receivable or contract assets that do not contain a significant financing component, the Company recognises the impairment provision for lifetime ECLs.

• (10) Derecognition of financial assets

The Company derecognises a financial asset when the contractual rights to receive the cash flows from the financial asset expire.

• (11) Inventories

The standard cost method is applied, and cost is determined using the weighted-average method. The cost of finished goods and work in process comprises raw materials, direct labor, other direct costs and related production overheads (allocated based on normal operating capacity). It excludes borrowing costs. The item by item approach is used in applying the lower of cost and net realisable value. Net realisable value is the estimated selling price in the ordinary course of business, less the estimated cost of completion and applicable variable selling expenses. When the cost of inventories exceeds the net realisable value the amount of any write-down of inventories is recognised as cost of sales during the period; and the amaunt of any reversal of inventory write-down is recognised as

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a reduction in the cost of sales during the period.

• (12) Investments accounted for using equity method - subsidiaries

• A. A subsidiary is an entity where the Company has the right to dominate its finance and operating policies (including special purpose entities), normally the Company owns more than 50% of the voting rights directly or indirectly in that entity. Subsidiaries are accounted for under the equity method in the Company's non-consolidated financial statements.

• B. Unrealised gains or losses resulting from inter-company transactions with subsidiaries are eliminated. To meet the consistency of accounting policies of the Company, necessary adjustments are made to the accounting policies of the subsidiaries.

• C. After acquisition of subsidiaries, the Company recognises proportionately the share of profit and loss and other comprehensive income in the income statement as part of the Company’s profit and loss and other comprehensive income, respectively. When the share of loss from a subsidiary exceeds the carrying amount of Company’s interest in that subsidiary, the Company continues to recognise its share in the subsidiary's loss proportionately.

• D. According to Regulations Governing the Preparation of Financial Statements by Securities Issuers, ‘profit for the year’ and ‘other comprehensive income for the year’ reported in an entity's parent company only statement of comprehensive income, shall equal to ‘profit for the year’ and ‘other comprehensive income’ attributable to owners of the parent reported in that entity’s consolidated statement of comprehensive income. Total equity reported in an entity’s parent company only financial statements, shall equal to equity attributable to owners of parent reported in that entity’s consolidated financial statements.

• (13) Property, plant and equipment

• A. Property, plant and equipment are initially recorded at cost. Borrowing costs incurred during the construction period are capitalised.

• B. Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to profit or loss during the financial period in which they are incurred.

• C. Property, plant and equipment apply cost model and are depreciated using the straight-line method to allocate their cost over their estimated useful lives. If each component of property, plant and equipment is significant, it is depreciated separately.

• D. The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each balance sheet date. If expectations for the assets’ residual values and useful lives differ from previous estimates or the patterns of consumption of the assets’ future economic benefits embodied in the assets have changed significantly, any change is accounted for as a change in estimate under IAS 8, ‘Accounting Policies, Changes in Accounting Estimates and Errors’, from the date of the change. The estimated useful lives of property, plant and equipment

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are as follows:

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----- Start of picture text -----

Assets Estimated useful lives
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Assets	Est	imate	d use	ful lives
Buildings and structures	2	～	35	years
Machinery and equipment	2	～	12	years
Transportation equipment	2	～	5	years
Office equipment	2	～	9	years
Other equipment	2	～	19	years

(14) Intangible assets

Professional skills and computer software, etc. are stated at cost and amortized on a straight-line basis over its estimated useful life of 3 ~ 5 years.

• (15) Leasing arrangements (lessee) － right-of-use assets/ lease liabilities

• A. Leases are recognised as a right-of-use asset and a corresponding lease liability at the date at which the leased asset is available for use by the Group. For short-term leases or leases of lowvalue assets, lease payments are recognised as an expense on a straight-line basis over the lease term.

• B. Lease liabilities include the net present value of the remaining lease payments at the commencement date, discounted using the incremental borrowing interest rate. Lease payments are fixed payments less any lease incentives receivable. The Group subsequently measures the lease liability at amortised cost using the interest method and recognises interest expense over the lease term. The lease liability is remeasured and the amount of remeasurement is recognised as an adjustment to the right-of-use asset when there are changes in the lease term or lease payments and such changes do not arise from contract modifications.

• C. At the commencement date, the right-of-use asset is stated at cost of under the amount of the initial measurement of lease liability. The right-of-use asset is measured subsequently using the cost model and is depreciated from the commencement date to the earlier of the end of the asset’s useful life or the end of the lease term. When the lease liability is remeasured, the amount of remeasurement is recognised as an adjustment to the right-of-use asset.

• D. For lease modifications that decrease the scope of the lease, the lessee shall decrease the carrying amount of right-of use assets to reflect the partial or full termination of the lease, and recognise the difference between remeasured lease liability in profit or loss.

• (16) Impairment of non-financial assets

The Company assesses at each balance sheet date the recoverable amounts of those assets where there is an indication that they are impaired. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell or value in use. When the circumstances or reasons for recognizing impairment loss for an asset in prior years no longer exist or diminish, the impairment loss shall be reversed to the extent of the loss previously recognised in profit or loss. The increased carrying amount due to reversal should not exceed the depreciated or amortized

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historical cost if the impairment had not been recognised.

• (17) Borrowings

• Borrowings comprise short-term bank borrowings. Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in profit or loss over the period of the borrowings using the effective interest method.

(18) Financial liabilities at fair value through profit or loss

• A. Financial liabilities are classified in this category of held for trading if acquired principally for the purpose of repurchasing in the short-term. Derivatives are also categorised as financial liabilities held for trading unless they are designated as hedges or financial liabilities at fair value through profit or loss. Financial liabilities that meet one of the following criteria are designated as at fair value through profit or loss at initial recognition:

  • (a) Hybrid (combined) contracts; or

  • (b) They eliminate or significantly reduce a measurement or recognition inconsistency; or

  • (c) They are managed and their performance is evaluated on a fair value basis, in accordance with a documented risk management policy.

• B. At initial recognition, the Company measures the financial liabilities at fair value. All related transaction costs are recognised in profit or loss. The Company subsequently measures these financial liabilities at fair value with any gain or loss recognised in profit or loss.

• (19) Notes and accounts payable

• A. Accounts payable are liabilities for purchases of raw materials, goods or services and notes payable are those resulting from operating and non-operating activities.

• B. The short-term notes and accounts payable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.

• (20) Financial guarantee contracts

• A financial guarantee contract is a contract that requires the Company to make specified payments to reimburse the holder for a loss it incurs because a specified debtor fails to make payment when due in accordance with the original or modified terms of a debt instrument. At initial recognition, the Company measures financial guarantee contracts at fair value and subsequently at the higher of amount of provisions determined by the expected credit losses and the cumulative gains that were previously recognised.

• (21) Derecognition of financial liabilities

• A financial liability is derecognised when the obligation under the liability specified in the contract is discharged, cancelled or expires.

(22) Offsetting financial instruments

• Financial assets and liabilities are offset and reported in the net amount in the balance sheet when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously.

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(23) Employee benefits

• A. Short-term employee benefits

Short - term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in respect of service rendered by employees in a period and should be recognised as expense in that period when the employees render service.

• B. Pensions

• (a) Defined contribution plan

For defined contribution plan, the contributions are recognised as pension expense when they are due on an accrual basis. Prepaid contributions are recognised as an asset to the extent of a cash refund or a reduction in the future payments.

  - (b) Defined benefit plan

     - i.Net obligation under a defined benefit plan is defined as the present value of an amount of pension benefits that employees will receive on retirement for their services with the Company in current period or prior periods. The liability recognised in the balance sheet in respect of defined benefit pension plans is the present value of the defined benefit obligation at the balance sheet date less the fair value of plan assets. The net defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method. The rate used to discount is determined by using interest of government bonds (at the balance sheet date) of a currency and term consistent with the currency and term of the employment benefit obligations. .

     - ii. Remeasurements arising on defined benefit plans are recognised in other comprehensive income in the period in which they arise, and recorded as retained earnings.

• C. Employees’ compensation and directors’ remuneration

  • Employees’ compensation and directors’ remuneration are recognised as expenses and liability, provided that such recognition is required under legal or constructive obligation and those amounts can be reliably estimated. Any difference between the resolved amounts and the subsequently actual distributed amounts is accounted for as changes in estimates. If employees’ compensation is distributed by shares, the Company calculates the number of shares based on the closing market price at the previous day of the board meeting resolution.

• (24) Employee share based payment

• For the equity-settled share-based payment arrangements, the employee services received are measured at the fair value of the equity instruments granted at the grant date, and are recognised as compensation cost over the vesting period, with a corresponding adjustment to equity. The fair value of the equity instruments granted shall reflect the impact of market vesting conditions and nonmarket vesting conditions. Compensation cost is subject to adjustment based on the service conditions that are expected to be satisfied and the estimates of the number of equity instruments that are expected to vest under the non-market vesting conditions at each balance sheet date. Ultimately, the amount of compensation cost recognised is based on the number of equity instruments that eventually vest.

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(25) Income tax

• A. The tax expense for the period comprises current and deferred tax. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or items recognised directly in equity, in which cases the tax is recognised in other comprehensive income or equity.

• B. The current income tax expense is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where the Company operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in accordance with applicable tax regulations. It establishes provisions where appropriate based on the amounts expected to be paid to the tax authorities. An additional tax is levied on the unappropriated retained earnings and is recorded as income tax expense in the year the stockholders resolve to retain the earnings.

• C. Deferred income tax is recognised, using the balance sheet liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated statements. However, the deferred income tax is not accounted for if it arises from initial recognition of goodwill or of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is provided on temporary differences arising on investments in subsidiaries except where the timing of the reversal of the temporary difference is controlled by the Company and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.

• D. Deferred income tax assets are recognised only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilized. At each balance sheet date, unrecognised and recognised deferred income tax assets are reassessed.

• E. Current income tax assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously. Deferred tax assets and liabilities are offset on the balance sheet when the entity has the legally enforceable right to offset current tax assets against current tax liabilities and they are levied by the same taxation authority on either the same entity or different entities that intend to settle on a net basis or realise the asset and settle the liability simultaneously.

• (26) Share capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or stock options are shown in equity as a deduction, net of tax, from the proceeds.

(27) Dividends

Dividends are recorded in the Company’s financial statements in the period in which they are

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resolved by the Company’s shareholders. Cash dividends are recorded as liabilities; stock dividends are recorded as stock dividends to be distributed and are reclassified to ordinary shares on the effective date of new shares issuance.

• (28) Revenue recognition

• A. Sales of goods

  • (a) The Company manufactures and sells API, intermediates, etc. Sales are recognised when control of the products has transferred, and there is no unfulfilled obligation that could affect the customer’s acceptance of the products. Delivery occurs when the products have been shipped to the specific location, the risks of obsolescence and loss have been transferred to the customer, and either the customer has accepted the products in accordance with the sales contract, or the Company has objective evidence that all criteria for acceptance have been satisfied.

  • (b) Revenue is recognised based on the price specified in the contract, net of the sales returns and discounts. Accumulated experience is used to estimate and provide for the sales returns and discounts, using the expected value method, and revenue is only recognised to the extent that it is highly probable that a significant reversal will not occur. The estimation is subject to an assessment at each reporting date. As the time interval between the transfer of committed goods or service and the payment of customer does not exceed one year, the Company does not adjust the transaction price to reflect the time value of money.

  • (c) A receivable is recognised when the goods are delivered as this is the point in time that the consideration is unconditional because only the passage of time is required before the payment is due.

• B. Sales of services

  • (a) The Company provides technology development and consultation services. Revenue from providing services is recognised in the accounting period in which the services are rendered. For fixed-price contracts, revenue is recognised based on the service rendered up to the end of the reporting period as a proportion of the total services to be provided. The customer pays at the time specified in the payment schedule. If the services rendered exceed the payment, a contract asset is recognised. If the payments exceed the services rendered, a contract liability is recognised.

  • (b) The Company’s estimate about revenue, costs and progress towards complete satisfaction of a performance obligation is subject to a revision whenever there is a change in circumstances. Any increase or decrease in revenue or costs due to an estimate revision is reflected in profit or loss during the period when the management becomes aware of the changes in circumstances.

• C. Incremental costs of obtaining a contract

Given that the contractual period lasts less than one year, the Company recognises the incremental costs (mainly comprised of sales commissions) of obtaining a contract as an expense

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when incurred although the Group expects to recover those costs.

(29) Government grants

• Government grants are recognised at their fair value only when there is reasonable assurance that the Group will comply with any conditions attached to the grants and the grants will be received. Government grants are recognised in profit or loss on a systematic basis over the periods in which the Group recognises expenses for the related costs for which the grants are intended to compensate.

5. CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND KEY SOURCES OF

ASSUMPTION UNCERTAINTY

The preparation of these parent company only financial statements requires management to make critical judgments in applying the Company’s accounting policies and make critical assumptions and estimates concerning future events. Assumptions and estimates may differ from the actual results and are continually evaluated and adjusted based on historical experience and other factors. Such assumptions and estimates have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next financial year, and the related information is addressed below:

(1) Critical judgments in applying the Company’s accounting policies

• None.

(2) Critical accounting estimates and assumptions

• A. Evaluation of inventories

• (a) As inventories are stated at the lower of cost and net realisable value, the Company must determine the net realisable value of inventories on balance sheet date using judgments and estimates. As the manufacturing process is long and complex, causing longer materials lead time, the waiting period for product registration is long, and the timing of customers’ product launch may be deferred, the Company evaluates the amounts of normal inventory consumption, obsolete inventories or inventories without market selling value on balance sheet date, and writes down the cost of inventories to the net realisable value. Such an evaluation of inventories is principally based on the demand for the products within the specified period in the future. Therefore, there might be material changes to the evaluation.

• (b) As of December 31, 2020, the carrying amount of inventories was $1,134,947.

• B. Realisability of deferred tax assets

• (a) Deferred income tax assets are recognised only to the extent that it is probable that future taxable profit will be available against which the deductible temporary differences can be utilised. Assessment of the realisability of deferred tax assets involves critical accounting judgments and estimates of the management, including the assumptions of expected future sales revenue growth rate and profit rate, tax exempt duration, available tax credits, tax planning, etc. Any variations in global economic environment, industrial environment, and laws and regulations might cause material adjustments to deferred income tax assets.

• (b) As of December 31, 2020, the Company recognised deferred income tax assets amounting to $505,018.

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6. DETAILS OF SIGNIFICANT ACCOUNTS

(1) CASH AND CASH EQUIVALENTS

TAILS OF SIGNIFICANT ACCOUNTS CASH AND CASH EQUIVALENTS
Cash: Cash on hand Cash equivalents: Time deposits Checking accounts and demand deposits Bills under repurchase agreements	December31,2020 30 $ 56,264 56,294 3,593,500 229,897 3,823,397 3,879,691 $	December31,2019 30 $ 130,132 130,162
		2,620,500 269,748
		2,890,248
		3,020,410 $

• A. The Company transacts with a variety of financial institutions all with high credit quality to disperse credit risk, so it expects that the probability of counterparty default is remote.

• B. Details of the Company’s time deposits pledged to others as collateral (listed as ‘Other financial assets - non-current’) as of December 31, 2020 and 2019 are provided in Note 8.

(2) FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS

Items Current items: Financial assets mandatorily measured at fair value through profit or loss Derivatives Non-current items: Financial assets mandatorily measured at fair value through profit or loss Unlisted stocks Valuation adjustment	December31,2020 December31,2019 2,172) ($ 2,920 $ 4,620 $ 4,620 $ 4,620) ( 4,620) ( - $ - $

• A. The Company recognised net gain (loss) of $2,295 and ($2,552) on financial assets at fair value through profit or loss (listed as “ Other gains and losses”) for the years ended December 31, 2020 and 2019, respectively.

• B. The Company entered into contracts relating to derivative financial liabilities which were not accounted for under hedge accounting. The information is listed below (Units in thousands of currencies indicated):

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	December	31,2020
Items	Contract amount	Contract period
Forward foreign exchange contracts	USD 11,545	11.2020~4.2021
	December	31,2019
Items	Contract amount	Contract period
Forward foreign exchange contracts	USD 13,553	10.2019~3.2020

The Company entered into forward foreign contracts to hedge exchange rate risk of operating activities. However, these forward foreign exchange contracts are not accounted for under hedge accounting.

• C. The Company has no financial assets at fair value through profit or loss pledged to others as of December 31, 2020 and 2019.

(3) ACCOUNTS RECEIVABLE, NET

December 31, 2020 and 2019. ACCOUNTS RECEIVABLE, NET
		December	31, 2020		December	31,2019
Accounts receivable		$	379,450		$	563,092
Less: Loss allowance	(		39)	(		236)
		$	379,411		$	562,856
A. The ageing analysis of accounts receivable is as follows:
		December	31,2020		December	31,2019
Not past due	$		341,719	$		441,811
Less than 30 days			29,608			73,342
Between 31 to 90 days			8,123			47,939
	$		379,450	$		563,092

The above ageing analysis is based on past due date.

• B. As of December 31, 2020 and 2019, accounts receivable arose from contracts with customers. As of January 1, 2019, the balance of receivables from contracts with customers amounted to $550,774.

• C. As of December 31, 2020 and 2019, the Company does not hold any collateral as security.

• D. As of December 31, 2020 and 2019, without taking into account any collateral held or other credit enhancements, the maximum exposure to credit risk in respect of the amount that best represents the Company’s accounts receivable is the book value.

• E. Information relating to credit risk of accounts receivable is provided in Note 12(2).

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(4) INVENTORIES

Raw materials Supplies Work in process Finished goods Raw materials Supplies Work in process Finished goods	Allowance for Cost market price decline 370,211 $ 53,175) ($ 28,370 2,576) ( 362,983 74,384) ( 687,202 183,684) ( 1,448,766 $ 313,819) ($ December31,2020 Allowance for Cost market price decline 325,013 $ 49,694) ($ 24,771 2,152) ( 313,720 59,425) ( 825,633 277,171) ( 1,489,137 $ 388,442) ($ December31,2019	Book value 317,036 $ 25,794 288,599 503,518 1,134,947 $ Bookvalue 275,319 $ 22,619 254,295 548,462 1,100,695 $

The Company recognised expense and loss of inventories for the year:

			For the years ended	For the years ended	For the years ended	December 31,
			2020			2019
Cost of goods sold		$	1,617,302		$	1,426,493
Loss on inventory scrap			43,508			19,529
Loss on physical inventory			519			3,170
Under applied manufacturing overhead			137,181			195,925
Reversal of allowance for inventory
market price decline (Note)	(		74,623)	(		2,590)
Revenue from sale of scraps	(		1,773)	(		8,472)
Total cost of goods sold		$	1,722,114		$	1,634,055

Note: The Company reversed a previous inventory write-down which was accounted for as reduction of cost of goods sold because certain inventory which were previously provided with allowance were again utilised in the research and development project or in production for the years ended December 31, 2020 and 2019, respectively.

(5) FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME -

NON-CURRENT

NON-CURRENT
Items Equity instruments Listed stocks Unlisted stocks Valuation adjustment	December31,2020 97,874 $ 167,673 265,547 42,568 308,115 $	December31,2019
		217,246 $ 167,673
		384,919 30,291
		415,210 $

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• A. The Company has elected to classify investments that are considered to be strategic investments as financial assets at fair value through other comprehensive income. The fair value of such investments is the book value as at December 31, 2020 and 2019.

• B. Due to the change in investment strategies, the Company sold $283,501 and $4,189 of equity instruments at fair value resulting in cumulative gain on disposal of $164,129 and $1,859 which was reclassified to retained earnings during the years ended December 31, 2020 and 2019, respectively.

• C. Amounts recognised in other comprehensive income in relation to the financial assets at fair value through other comprehensive income are listed below:

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----- Start of picture text -----

Equity instruments at fair value through other For the years ended December 31,
comprehensive income 2020 2019
Fair value change recognised in other
comprehensive income $ 176,406 ($ 48,718)
Cumulative losses (gains) reclassified to
retained earnings due to derecognition ($ 164,129) ($ 1,859)
----- End of picture text -----

• D. The Company has no financial assets at fair value through other comprehensive income pledged to others as of December 31, 2020 and 2019.

(6) INVESTMENTS ACCOUNTED FOR USING EQUITY METHOD

			Forthe years ended	Forthe years ended	December31,
			2020		2019
At January 1		$	1,763,209	$	745,548
Addition of investments accounted
for using equity method			-		1,192,251
Share of profit or loss of investments
accounted for using equity method	(		104,620)	(	117,725)
Changes in other equity items			22,506	(	56,865)
At December 31		$	1,681,095	$	1,763,209
		December31,2020		December31,2019
Subsidiaries:
SPT International, Ltd.		$	1,680,970	$	1,763,097
ScinoPharm Singapore Pte Ltd.			125		112
		$	1,681,095	$	1,763,209

• A. For information relating to the Company’s subsidiaries, please refer to Note 4(3), “Basis of consolidation” of the Company’s 2020 consolidated financial statements.

• B. The share of loss of subsidiaries, associates and joint ventures accounted for using equity method amounted to ($104,620) and ($117,725) for the years ended December 31, 2020 and 2019, respectively.

• C. As of December 31, 2020 and 2019, the Company does not hold any investment accounted for using equity method as collateral.

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(7) PROPERTY, PLANT AND EQUIPMENT

														Construction in
														progress and
				Machinery and		Transportation			Office		Other			equipment before
January 1, 2020		Buildings			equipment		equipment		equipment		equipment		acceptance inspection			Total
Cost	$	2,517,741	$		4,542,361	$	18,851	$	171,047	$	3,956	$		1,013,226	$	8,267,182
Accumulated depreciation	(	1,078,028)	(		3,829,848)	(	18,423)	(	137,258)	(	2,169)			-	(	5,065,726)
Accumulated impairment		-	(		9,284)		-		-		-			-	(	9,284)
	$	1,439,713	$		703,229	$	428	$	33,789	$	1,787	$		1,013,226	$	3,192,172
For the year ended December 31, 2020
At January 1	$	1,439,713	$		703,229	$	428	$	33,789	$	1,787	$		1,013,226	$	3,192,172
Additions		-			4,488		-		-		-			71,853		76,341
Reclassified from prepayments for equipment		-			-		-		-		-			63,554		63,554
Reclassified upon completion		8,683			64,001		204		11,473		-	(		84,361)		-
Transferred to intangible assets		-			-		-		-		-	(		1,161)	(	1,161)
Transfered to loss (Note 1)		-			-		-		-		-	(		11,900)	(	11,900)
Depreciation charge	(	105,190)	(		147,813)	(	218)	(	13,621)	(	142)			-	(	266,984)
Disposals－Cost		-	(		58,774)	(	1,475)	(	18,264)		-			-	(	78,513)
' －Accumulated depreciation		-			56,063		1,475		18,264		-			-		75,802
Gain on reversal of impairment loss		-			4,253		-		-		-			-		4,253
At December 31	$	1,343,206	$		625,447	$	414	$	31,641	$	1,645	$		1,051,211	$	3,053,564
December 31, 2020
Cost	$	2,526,424	$		4,552,076	$	17,580	$	164,256	$	3,956	$		1,051,211	$	8,315,503
Accumulated depreciation	(	1,183,218)	(		3,921,598)	(	17,166)	(	132,615)	(	2,311)			-	(	5,256,908)
Accumulated impairment		-	(		5,031)		-		-		-			-	(	5,031)
	$	1,343,206	$		625,447	$	414	$	31,641	$	1,645	$		1,051,211	$	3,053,564

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														Construction in
														progress and
				Machinery and		Transportation			Office		Other			equipment before
January 1, 2019		Buildings			equipment		equipment		equipment		equipment		acceptance inspection			Total
Cost	$	2,509,751	$		4,496,132	$	18,851	$	161,378	$	3,956	$		1,056,179	$	8,246,247
Accumulated depreciation	(	971,249)	(		3,721,669)	(	17,358)	(	137,439)	(	1,995)			-	(	4,849,710)
Accumulated impairment		-	(		8,577)		-		-		-			-	(	8,577)
	$	1,538,502	$		765,886	$	1,493	$	23,939	$	1,961	$		1,056,179	$	3,387,960
For the year ended December 31, 2019
At January 1	$	1,538,502	$		765,886	$	1,493	$	23,939	$	1,961	$		1,056,179	$	3,387,960
Additions		-			3,029		-		-		-			21,681		24,710
Reclassified from prepayments for equipment		-			-		-		-		-			82,142		82,142
Reclassified upon completion		7,990			87,598		-		21,962		-	(		117,550)		-
Transferred to intangible assets		-			-		-		-		-	(		6,500)	(	6,500)
Transfered to loss (Note 2)		-			-		-		-		-	(		22,726)	(	22,726)
Depreciation charge	(	106,779)	(		152,577)	(	1,065)	(	12,112)	(	174)			-	(	272,707)
Disposals－Cost		-	(		44,398)		-	(	12,293)		-			-	(	56,691)
' －Accumulated depreciation		-			44,398		-		12,293		-			-		56,691
Impairment loss		-	(		707)		-		-		-			-	(	707)
At December 31	$	1,439,713	$		703,229	$	428	$	33,789	$	1,787	$		1,013,226	$	3,192,172
December 31, 2019
Cost	$	2,517,741	$		4,542,361	$	18,851	$	171,047	$	3,956	$		1,013,226	$	8,267,182
Accumulated depreciation	(	1,078,028)	(		3,829,848)	(	18,423)	(	137,258)	(	2,169)			-	(	5,065,726)
Accumulated impairment		-	(		9,284)		-		-		-			-	(	9,284)
	$	1,439,713	$		703,229	$	428	$	33,789	$	1,787	$		1,013,226	$	3,192,172

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• Note 1 ： The Company's custom-made software module did not function as expected and meet the Company’s end use during the development process. After internal discussion, the Company has decided to write off the unfinished software, and recognised the costs incurred as losses.

• Note 2 ： The Company did not accept the customized equipment ordered from the vendor as its format and efficiency did not meet expectations. In April 2019, both parties reached a consensus. The vendor refunded and terminated the purchase of equipment and the Company transfered the balance of the related construction in progress and equipment before acceptance inspection to loss.

• A. The Company has not capitalised any interest for the years ended December 31, 2020 and 2019.

• B. The Company’s property, plant and equipment were owner-occupied for the years ended December 31, 2020 and 2019.

• C. Information about reversal of impairment loss and impairment loss on property, plant and equipment is provided in Note 6(9).

• D. As of December 31, 2020 and 2019, no property, plant and equipment were pledged to others as collateral.

• －

• (8) Leasing arrangements lessee

• A. The Company leases land and buildings and structures. Rental contracts are typically made for periods of 50 (including option to extend the leases) and 2 years. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements do not impose covenants, but leased assets may not be used as security for borrowing purposes.

• B. Short-term leases with a lease term of 12 months or less pertain to office premises and low-value assets pertain to computers.

• C. The carrying amount of right-of-use assets and the depreciation charge are as follows:

Land Buildings and structures Land Buildings and structures		December31,2020 December31,2019 Carrying amount Carrying amount $ 557,484 $ 602,221 2,363 - 559,847 $ 602,221 $ For theyears ended December 31,	December31,2020 December31,2019 Carrying amount Carrying amount $ 557,484 $ 602,221 2,363 - 559,847 $ 602,221 $ For theyears ended December 31,	December31,2020 December31,2019 Carrying amount Carrying amount $ 557,484 $ 602,221 2,363 - 559,847 $ 602,221 $ For theyears ended December 31,
		2020		2019
		Depreciationcharge $ 12,457 337 12,794 $		Depreciationcharge $ 15,148 - 15,148 $

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D. The information on profit and loss accounts relating to lease contracts is as follows:

For the year ended December31,2020 Items affecting profit or loss Interest expense on lease liabilities $ 6,900 Expense on short-term lease contracts 1,729 Expense on leases of low-value assets 1,005	For the year ended December31,2019 $ 8,510 2,487 877

• F. For the years ended December 31, 2020 and 2019, the Company’s total cash outflow for leases were $19,406 and $23,209, respectively.

(9) IMPAIRMENT OF NON-FINANCIAL ASSETS

• －

• A. The Company recognised the reversal of impairment loss amounting to $ and $707 for the years ended December 31, 2020 and 2019, respectively. Some of the idle machineries were again utilised in production and accordingly, the Company recognised the reversal of impairment loss －

• amounting to $4,253 and $ for the years ended December 31, 2020 and 2019 (listed as “Other gains and losses”), respectively. For details of accumulated impairment, please refer to Note 6(7).

• B. The (gain on reversal of) impairment loss reported by operating segments are as follows:

For the years ended December 31,

		2020	2020				2019	2019
		Recognised in other					Recognised in other
	Recognised in		comprehensive		Recognised in			comprehensive
Department	profit or loss			income	profit or	loss		income
ScinoPharm Taiwan	4,253) ($	$		-	$	707	$	-
SHORT-TERM BORROWINGS
Type of borrowings	December		31,	2020	Interest rate			Collateral
Bank loans
Unsecured loans	$			9,494	0.79%			None

(10) SHORT-TERM BORROWINGS

The Company has no short-term borrowings as of December 31, 2019.

Please refer to Note 6(22) for interest expense recognised in profit or loss for the years ended December 31, 2020 and 2019.

(11) OTHER PAYABLES

December 31, 2020 and 2019. OTHER PAYABLES
Accrued salaries and bonuses Accrued employees’ compensation and directors' remuneration Payables on equipment Others	December31,2020 64,760 $ 43,210 39,929 160,661 308,560 $	December31,2019
		61,630 $ 28,493 28,117 167,052
		285,292 $

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(12) PENSIONS

• A. The Company has set up a defined benefit pension plan in accordance with the Labor Standards Law, which applies to all regular employees’ service years prior to the enforcement of the Labor Pension Act (the “Act”) on July 1, 2005 and service years thereafter of employees who chose to continue to be covered under the pension scheme of the Labor Standards Law after the enforcement of the Act. In accordance with the Company's retirement plan, an employee may retire when the employee either (i) attains the age of 55 with 15 years of service, (ii) has more than 25 years of service, (iii) has reached the age of 65, or (iv) is incapacitated to work (compulsory retirement). The employees earn two units for each year of service for the first 15 years, and one unit for each additional year thereafter up to a maximum of 45 units. Any fraction of a year equal to or more than six months shall be counted as one year of service, and any fraction of a year less than six months shall be counted as half a year. According to the provisions, employees who retired due to their duties shall get additional 20%. Pension payments are based on the number of units earned and the average salary of the last six months prior to retirement. Calculation of average salary is in accordance with the Labor Standards Law of the R.O.C. The Company contributes monthly an amount equal to 2% of the employees' monthly salaries and wages to the retirement fund deposited with Bank of Taiwan under the name of the independent retirement fund committee. Also, the Company would assess the balance in the aforementioned labor pension reserve account by December 31, every year. If the account balance is not enough to pay the pension calculated by the aforementioned methods to the employees expected to qualify for retirement in the following year, the Company will make contribution for the deficit by the end of March next year.

(a) The amounts recognised in the balance sheet are as follows:

		December	31,2020		December	31,2019
Present value of defined benefit obligations		$	109,601		$	127,729
Fair value of plan assets	(		30,369)	(		45,547)
Net defined benefit liability		$	79,232		$	82,182

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(b) Movements in net defined liabilities are as follows:

Present value of

==> picture [447 x 511] intentionally omitted <==

----- Start of picture text -----

For the year ended defined benefit Fair value of Net defined
December 31, 2020 obligations plan assets benefit liability
At January 1 $ 127,729 ($ 45,547) $ 82,182
Current service cost 1,696 - 1,696
Interest expense (income) 894 ( 319) 575
130,319 ( 45,866) 84,453
Remeasurements:
-
Return on plan assets ( 1,642) ( 1,642)
Change in financial
-
assumptions ( 17,202) ( 17,202)
Experience adjustments 16,475 - 16,475
( 727) ( 1,642) ( 2,369)
-
Pension fund contribution ( 2,852) ( 2,852)
-
Paid pension ( 19,991) 19,991
At December 31 $ 109,601 ($ 30,369) $ 79,232
Present value of
For the year ended defined benefit Fair value of Net defined
December 31, 2019 obligations plan assets benefit liability
At January 1 $ 121,105 ($ 44,242) $ 76,863
Current service cost 1,579 - 1,579
Interest expense (income) 1,211 ( 442) 769
123,895 ( 44,684) 79,211
Remeasurements:
-
Return on plan assets ( 1,976) ( 1,976)
Change in financial
-
assumptions 3,927 3,927
-
Experience adjustments 3,985 3,985
7,912 ( 1,976) 5,936
Pension fund contribution - ( 2,965) ( 2,965)
Paid pension ( 4,078) 4,078 -
At December 31 $ 127,729 ($ 45,547) $ 82,182
----- End of picture text -----

(c) The Bank of Taiwan was commissioned to manage the Fund of the Company’s defined benefit pension plan in accordance with the Fund’s annual investment and utilisation plan and the “Regulations for Revenues, Expenditures, Safeguard and Utilisation of the Labor Retirement Fund” (Article 6: The scope of utilisation for the Fund includes deposit in domestic or foreign financial institutions, investment in domestic or foreign listed, over-the-counter, or private placement equity securities, investment in domestic or foreign real estate securitisation products, etc.). With regard to the utilisation of the Fund, its minimum earnings in the annual

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distributions on the final financial statements shall be no less than the earnings attainable from the amounts accrued from two-year time deposits with the interest rates offered by local banks. If the earnings is less than aforementioned rates, government shall make payment for the deficit after being authorised by the Regulator. The Company has no right to participate in managing and operating that fund and hence the Company is unable to disclose the classification of plan asset fair value in accordance with IAS 19 paragraph 142. The composition of fair value of plan assets as of December 31, 2020 and 2019 is given in the Annual Labor Retirement Fund Utilisation Report announced by the government.

(d) The principal actuarial assumptions used were as follows:

	Forthe years endedDecember31,	Forthe years endedDecember31,
	2020	2019
Discount rate	0.30%	0.70%
Future salary increases	1.00%	3.00%

Assumptions regarding future mortality experience are set based on actuarial advice in accordance with published statistics and experience according to Taiwan Life Insurance Industry 5[th] Mortality Table for the years ended December 31, 2020 and 2019.

Because the main actuarial assumption changed, the present value of defined benefit obligation is affected. The analysis was as follows:

==> picture [449 x 122] intentionally omitted <==

----- Start of picture text -----

Discount rate Future salary increases
Increase 0.25% Decrease 0.25% Increase 0.25% Decrease 0.25%
December 31, 2020
Effect on present value of
defined benefit obligation ($ 2,794) $ 2,890 $ 2,585 ($ 2,516)
December 31, 2019
Effect on present value of
defined benefit obligation ($ 3,284) $ 3,403 $ 3,000 ($ 2,916)
----- End of picture text -----

The sensitivity analysis above was arrived at based on one assumption which changed while the other conditions remain unchanged. In practice, more than one assumption may change all at once. The method of analysing sensitivity and the method of calculating net pension liability in the balance sheet are the same.

The method and types of assumptions used in preparing the sensitivity analysis did not change compared to the previous year.

• (e) Expected contributions to the defined benefit pension plan of the Company for 2021 amounted to $2,966.

• (f) As of December 31, 2020, the weighted average duration of that retirement plan is 10 years. The analysis of timing of the future pension payment was as follows:

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Within 1 year $ 2,097 2 ～ 5 years 14,864 Over 6 years 96,120 $ 113,081

• B. Effective July 1, 2005, the Company has established a defined contribution pension plan (the “New Plan”) under the Labor Pension Act (the “Act”), covering all regular employees with R.O.C. nationality. Under the New Plan, the Company contributes monthly an amount based on 6% of the employees’ monthly salaries and wages to the employees’ individual pension accounts at the Bureau of Labor Insurance. The benefits accrued are paid monthly or in lump sum upon termination of employment. The net pension costs recognised under the defined contribution plan were $25,773 and $24,621 for the years ended December 31, 2020 and 2019, respectively.

(13) SHARE CAPITAL

• A. Movements in the number of the Company’s ordinary shares outstanding are as follows (in thousands of shares):

thousands of shares):
Beginning and ending number of the year	For theyears ended December31,
	2020 790,739	2019
		790,739

• B. As of December 31, 2020, the Company’s authorised capital was $10,000,000 and the paid-in capital was $7,907,392 (790,739 thousand shares) with a par value of $10 (in dollars) per share. All proceeds from shares issued have been collected.

(14) CAPITAL RESERVE

• A. Pursuant to the R.O.C. Company Act, capital reserve arising from paid-in capital in excess of par value on issuance of common stock and donations shall be exclusively used to cover accumulated deficit or, distribute cash or stocks in proportion to their share ownership, provided that the Company has no accumulated deficit. Further, the R.O.C. Securities and Exchange Act requires that the capital reserve to be capitalised mentioned above should not exceed 10% of the paid-in capital each year. Capital reserve should not be used to cover accumulated deficit unless the legal reserve is insufficient.

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B. Movements in the Company’s capital reserve are as follows:

At January 1 Employee stock options compensation cost －Company Employee stock options forfeited －Company －Subsidiaries At December 31 At January 1 Employee stock options compensation cost －Company Employee stock options forfeited －Company －Subsidiaries At December 31	Share premium Stockoptions Total 1,245,682 $ 48,923 $ 1,294,605 $ - 84 84 1,082 1,082) ( - 208 208) ( - 1,246,972 $ 47,717 $ 1,294,689 $ Share premium Stockoptions Total 1,237,787 $ 54,768 $ 1,292,555 $ - 2,050 2,050 7,686 7,686) ( - 209 209) ( - 1,245,682 $ 48,923 $ 1,294,605 $ Forthe yearendedDecember31,2020 Forthe yearendedDecember31,2019	Share premium Stockoptions Total 1,245,682 $ 48,923 $ 1,294,605 $ - 84 84 1,082 1,082) ( - 208 208) ( - 1,246,972 $ 47,717 $ 1,294,689 $ Share premium Stockoptions Total 1,237,787 $ 54,768 $ 1,292,555 $ - 2,050 2,050 7,686 7,686) ( - 209 209) ( - 1,245,682 $ 48,923 $ 1,294,605 $ Forthe yearendedDecember31,2020 Forthe yearendedDecember31,2019
		1,292,555 $ 2,050 - -
		1,294,605 $

(15) SHARE-BASED PAYMENT - EMPLOYEES’ COMPENSATION

A. The Company issued 1 million units, 1.5 million units and 1.5 million units of employee stock options on December 3, 2013, November 6, 2015 and October 14, 2016, respectively (the Grant Date). The exercise prices of the options were set at $91.70 (in dollars), $41.65 dollars (in dollars) and $40.55 (in dollars), respectively, which were based on the closing market price of the Company’s common shares on the Grant Date. Each option was granted the right to purchase one share of the Company’s common stocks. The exercise price is subject to further adjustments when there is change in share numbers of the Company’s common stocks after the Grant Date. As of December 31, 2020, for the issued 1 million units, 1.5 million units and 1.5 million units of employee stock options, the exercise price was adjusted based on the specific formula to $74.5 (in dollars) per share, $37.2 (in dollars) per share and $37.7 (in dollars) per share, respectively. Contract period of the employee stock option plans is 10 years, and options are exercisable in 2 years after the Grant Date. The Company recognised compensation cost relating to the employee stock options plan of $84 and $2,050 for the years ended December 31, 2020 and 2019, respectively.

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B. Details of the share-based payment arrangement are as follows:

For the year ended December 31, 2020

		For theyear ended	December31,2020	December31,2020
			Weighted-average
		Number of options		exercise price
		(unitinthousands )		(indollars)
Options	outstanding at beginning of the year	2,205	$	45.05
Options	forfeited	76) (		49.15
Options	outstanding at end of the year	2,129		44.90
Options	exercisable at end of the year	2,129		44.90
		Forthe yearended	December31,2019
			Weighted-average
		Number of options		exercise price
		(unitinthousands )		(indollars)
Options	outstanding at beginning of the year	2,725	$	46.08
Options	forfeited	520) (		46.89
Options	outstanding at end of the year	2,205		45.05
Options	exercisable at end of the year	1,967		45.93

• C. The expiry date and exercise prices of the employee stock options outstanding at balance sheet date is as follows:

Grant date 12.3.2013 11.6.2015 10.14.2016	No. of stocks Exercise price No. of stocks Exercise price Expiry date (unitinthousands) (indollars) (unitinthousands) (indollars) 12.2.2023 427 74.50 $ 451 74.50 $ 11.5.2025 776 37.20 802 37.20 10.13.2026 926 37.70 714 37.70 December31,2020 December31,2019

• D. The fair value of the Company’s employee stock option on Grant Date was evaluated using the combination of Hull & White and the Ritchken trinomial option valuation model. Related information is as follows:

Type of arrangement Employee stock options Employee stock options Employee stock options	Grant date 12.3.2013 11.6.2015 10.14.2016	Stock price (in dollars) 91.70 $ 41.65 40.55	Exercise price (in dollars) 91.70 $ 41.65 40.55	Price volatility 28.50% (Note) 37.63% (Note) 37.20% (Note)	Option Expected Interest life dividends rate 10 years 1.5% 1.7145% 10 years 1.5% 1.2936% 10 years 1.5% 0.9223%	Fair value per unit (in dollars)
						26.045 $ 13.799 13.171

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• Note: According to daily returns of the Company's stock for the previous year, the annualised volatility is 28.50%, 37.63% and 37.20%, respectively.

(16) RETAINED EARNINGS

• A. Pursuant to the amended R.O.C. Company Act, the current year's after-tax earnings should be used initially to cover any accumulated deficit; thereafter 10% of the remaining earnings should be set aside as legal reserve until the balance of legal reserve is equal to that of paid-in capital. The legal reserve shall be exclusively used to cover accumulated deficit, to issue new stocks, or to distribute cash to shareholders in proportion to their share ownership. The use of legal reserve for the issuance of stocks or cash dividends to shareholders in proportion to their share ownership is permitted, provided that the distribution of the reserve is limited to the portion in excess of 25% of the Company’s paid-in capital.

• B. Since the Company is in a changeable industry environment and the life cycle of the Company is in a stable growth, the appropriation of earnings should consider fund requirements and capital budget to decide how much earnings will be kept or distributed and how much cash dividends will be distributed. According to the Company’s Articles of Incorporation, 10% of the annual net income, after offsetting any loss of prior years and paying all taxes and dues, shall be set aside as legal reserve. The remaining net income and the unappropriated retained earnings from prior years can be distributed in accordance with a resolution passed during a meeting of the Board of Directors and approved at the stockholders' meeting. Of the amount to be distributed by the Company, stockholders’ dividends shall comprise 50% to 100% of the unappropriated retained earnings, and the percentage of cash dividends shall not be less than 30% of dividends distributed.

• C. In accordance with the regulations, the Company shall set aside special reserve for the debit balance on other equity items at the balance sheet date before distributing earnings. When debit balance on other equity items is reversed subsequently, the reversed amount could be included in the distributable earnings. The amounts previously set aside by the Company as special reserve on initial application of IFRSs in accordance with Order No. Financial-Supervisory-SecuritiesCorporate-1010012865, dated April 6, 2012, shall be reversed proportionately when the relevant assets are used, disposed of or reclassified subsequently.

• D. The Company recognised cash dividends distributed to owners amounting to $213,500 ($0.27 (in dollars) per share) and $387,462 ($0.49 (in dollars) per share) for the years ended December 31, 2020 and 2019, respectively. On March 18, 2021, the Board of Directors proposed for the distribution of cash dividends of $395,370 ($0.5 (in dollars) per share) from 2020 earnings.

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(17) OTHER EQUITY ITEMS

For the year ended December 31, 2020

			Unrealised gain (loss)	Unrealised gain (loss)
	Currency	translation		onvaluation		Total
At January 1	($	98,117)	$	30,291	($	67,826)
Revaluation		-		176,406		176,406
Revaluation transferred to retained		-	(	164,129)	(	164,129)
earnings
Currency translation differences
- Group		22,506		-		22,506
At December 31	($	75,611)	$	42,568	($	33,043)

		For the year ended December 31,	For the year ended December 31,	For the year ended December 31,	For the year ended December 31,	2019	2019
			Unrealised gain (loss)
	Currency	translation		onvaluation			Total
At January 1	($	41,252)	$	80,868		$	39,616
Revaluation		-	(	48,718)	(		48,718)
Revaluation transferred to retained		-	(	1,859)	(		1,859)
earnings
Currency translation differences
- Group	(	56,865)		-	(		56,865)
At December 31	($	98,117)	$	30,291	($		67,826)

(18) OPERATING REVENUE

A. Disaggregation of revenue from contracts with customers

The Company derives revenue from the transfer of goods at a point in time and the vender of services over time in the following major product lines:

For the year ended December31,2020 Timing of revenue recognition: At a point in time Over time	API Income 2,778,559 $ - 2,778,559 $	Injection Product Income 146,322 $ - 146,322 $	Technical Servical Income - $ 81,718 81,718 $	Other Operating Income - $ 39,621 39,621 $		Total
						2,924,881 $ 121,339 3,046,220 $

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				Injection		Technical		Other
For the year ended		API		Product		Servical	Operating
December31,2019		Income		Income		Income		Income		Total
Timing of revenue
recognition:
At a point in time	$	2,543,599	$	138,202	$	-	$	-	$	2,681,801
Over time		-		-		86,642		44,604		131,246
	$	2,543,599	$	138,202	$	86,642	$	44,604	$	2,813,047

• B. The Company has recognised contract liabilities related to the contract revenue from advance customer payment of $47,518, $46,789 and $22,541 on December 31, 2020, December 31, 2019 and January 1, 2019, respectively.

• C. The revenue recognised that was included in the contract liability balance at the beginning of the year amounted to $37,774 and $21,908 for the years ended December 31, 2020 and 2019, respectively.

(19) INTEREST INCOME

(19)	respectively. INTEREST INCOME
(20)	OTHER INCOME Interest income from bank deposits Management service revenue Joint loan guarantee revenue Production capacity subsidy income Gains on write-off of past due payable Compensation income Government grant Others	2020 2019 21,043 $ 28,541 $ Forthe years endedDecember31, For the years ended December 31,
		2020 13,305 $ 414 7,229 5,299 - - 2,917 29,164 $	2019 13,699 $ 2,095 7,890 124 30,109 8,963 3,415
			66,295 $

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(21) OTHER GAINS AND LOSSES

OTHER GAINS AND LOSSES
			Forthe years ended		December31,
			2020		2019
Net gain (loss) on financial assets/liabilities
at fair value through profit or loss		$	2,295	($	2,552)
Gain on reversal of (impairment loss)			4,253	(	707)
Loss on disposal of property, plant
and equipment	(		2,587)		-
Loss on unfinished construction in progress	(		11,900)	(	22,726)
Net currency exchange loss	(		23,322)	(	2,409)
Others	(		5,226)	(	15,968)
	($		36,487)	($	44,362)

(22) FINANCE COSTS

FINANCE COSTS
Interest expense: Bank loans Interest on lease liabilities	For theyears ended December31,
	2020 172 $ 6,900 7,072 $	2019
		22 $ 8,510
		8,532 $

(23) EXPENSES BY NATURE

EXPENSES BY NATURE
Employee benefit expenses Depreciation of property, plant and equipment Depreciation of right-of-use assets Amortisation Employee benefit expenses Depreciation of property, plant and equipment Depreciation of right-of-use assets Amortisation	For the year ended December 31, 2020
	Operating costs Operating expenses Total 371,634 $ 331,227 $ 702,861 $ 173,227 93,757 266,984 - 12,794 12,794 1,684 4,360 6,044 546,545 $ 442,138 $ 988,683 $ Forthe yearendedDecember31,2019		Total
			702,861 $ 266,984 12,794 6,044
			988,683 $
	Operating costs 359,190 $ 181,967 - 2,407 543,564 $	Operating expenses 297,196 $ 90,740 15,148 5,286 408,370 $	Total
			656,386 $ 272,707 15,148 7,693
			951,934 $

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(24) EMPLOYEE BENEFIT EXPENSES

EMPLOYEE BENEFIT EXPENSES
		Forthe yearendedDecember31,				2020
	Operating costs		Operating expenses			Total
Salaries and wages	$	315,578	$	267,818	$	583,396
Labor and health insurance expenses		28,420		20,514		48,934
Pension costs		16,000		12,044		28,044
Directors’ compensation		-		17,739		17,739
Other personnel expenses		11,636		13,112		24,748
	$	371,634	$	331,227	$	702,861
		Forthe yearendedDecember31,				2019
	Operating costs		Operating expenses			Total
Salaries and wages	$	302,591	$	237,642	$	540,233
Labor and health insurance expenses		28,587		18,800		47,387
Pension costs		16,188		10,781		26,969
Directors’ compensation		-		14,547		14,547
Other personnel expenses		11,824		15,426		27,250
	$	359,190	$	297,196	$	656,386

• A. As of December 31, 2020 and 2019, the Company had 667 and 638 employees, respectively, both including 13 directors who were non-employee directors.

• B. For the years ended December 31, 2020 and 2019, the average employee benefit expense were $1,048 and $1,027, respectively; while the average wages and salaries were $892 and $864, respectively. For the year ended December 31, 2020, the average employee benefit expense increased by 3.24%

• C. Remuneration policy, standards and packages, procedures for determining remuneration and the correlation with operating performance and future risk exposure:

• (a) Remunerations of directors and supervisors include reward, transportation allowance, income from professional practice, and earnings distribution. The rewards of directors and supervisors will be determined by the board of directors, based on authorization by the Company as set in Company rules and regulations, after weighing the degree of their participation in the Company’s business operations, the value of their contributions and the rewards of their counterparts of the Company’s peers. The distribution of earnings to directors and supervisors, in accordance with company rules and regulations, will be carried out after being deliberated by the board of directors and ratified by the shareholders during their meeting.

• (b) Remunerations of president and vice presidents include regular pay and employee bonus. The regular pay will be determined after their contributions to the Company and the average pay level of the Company’s peers are taken into consideration. The allocation criteria for employee bonus will be based on Company rules and regulations and the allocation will be

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done after being deliberated by the board of directors and ratified by the shareholders during their meeting.

• (c) Related remunerations are to be determined in accordance with the contributions to the Company and the remuneration levels of the Company’s peers, and the remuneration figures will be revealed in accordance with related rules and regulations of the law.

• D. According to the Articles of Incorporation of the Company, a ratio of distributable profit of the current year, after covering accumulated losses, shall be distributed as employees’ compensation and directors’ remuneration. The ratio shall not be lower than 2% for employees’ compensation and shall not be higher than 2% for directors’ remuneration.

• E. For the years ended December 31, 2020 and 2019, employees’ compensation was accrued at $35,288 and $24,651, respectively; while directors’ remuneration was accrued at $7,922 and $3,842, respectively. The aforementioned amounts were recognised in salary expenses. The expenses recognised for each year was accrued based on the earnings of current year and the percentage specified in the Articles of Incorporation of the Company. On March 18, 2021, the Board of Directors resolved to distribute employees’ compensation and directors’ remuneration of $35,288 and $7,922, respectively, and the employees’ compensation will be distributed in the form of cash.

The actual amount approved at the Board of Directors’ meeting for employees’ compensation and directors’ remuneration for 2019 was $27,593 which was the different from the estimated amount of $28,493 recognised in the 2019 financial statements by $900. Such difference mainly resulted from estimation, and has been recognized in profit or loss in September 2020. The employees’ compensation will be distributed in the form of cash for 2019. Information about the appropriation of employees’ compensation and directors’ remuneration by the Company as resolved by the Board of Directors will be posted in the “Market Observation Post System” at the website of the Taiwan Stock Exchange.

(25) INCOME TAX

A. Income tax expense

• (a) Components of income tax expense:

For the years ended December 31,

		2020		2019
Current income tax:
Income tax in the current year	$	68,838	$	63,001
Tax on unappropriated retained earnings		-		227
Under (over) provision of prior year’s income tax		3,106	(	436)
Total current tax		71,944		62,792
Deferred income tax:
Origination and reversal of temporary differences	(	1,129)	(	32,934)
Income tax expense	$	70,815	$	29,858

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(b) The income tax relating to components of other comprehensive income is as follows:

Remeasurement of defined benefit obligations	2020 2019 473 $ 1,187) ($ Forthe years endedDecember31,

B. Reconciliation between income tax expense and accounting profit:

			Forthe years ended	Forthe years ended	Forthe years ended	December31,
			2020			2019
Income tax at statutory tax rate		$	70,577		$	49,303
Effect of items disallowed by tax regulation			228	(		17,458)
Effect of investment tax credits	(		3,096)	(		1,778)
Tax on unappropriated retained earnings			-			227
Under (over) provision of prior year’s income tax			3,106	(		436)
Income tax expense		$	70,815		$	29,858

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C. Amounts of deferred tax assets or liabilities as a result of temporary differences are as follows: For the year ended December 31, 2020

Recognised in other Recognised in comprehensive January1 profit or loss income Deferred tax assets: Temporary differences Unrealised loss on inventory market value decline 77,688 $ 14,924) ($ - $ Unrealised loss on components and spare parts market value decline 16,203 662 - Investment loss 377,753 20,924 - Technology know-how 7,976 4,350) ( - Pensions 16,436 116) ( 473) ( Employee benefits - unused compensated absences 4,659 206 - Impairment of assets 1,857 851) ( - Unrealised exchange loss 1,424 490) ( - Unrealised holding loss on financial liabilities - 434 - Unrealised loss 187 187) ( - Rent expense 763 763) ( - 504,946 $ 545 $ 473) ($ Deferred tax liabilities: Temporary differences Unrealised gain on financial instruments 584) ($ 584 $ - $ 504,362 $ 1,129 $ 473) ($	December31
	62,764 $ 16,865 398,677 3,626 15,847 4,865 1,006 934 434 - -
	505,018 $
	- $
	505,018 $

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		For	For	the yearended	the yearended	December31,2019	December31,2019	December31,2019
						Recognised
							in other
				Recognised in		comprehensive
		January1		profit or loss			income	December31
Deferred tax assets:
Temporary differences
Unrealised loss on inventory
market value decline	$	78,206	($		518)	$	-	$	77,688
Unrealised loss on
components and spare parts
market value decline		-			16,203		-		16,203
Investment loss		354,208			23,545		-		377,753
Technology know-how		12,326	(		4,350)		-		7,976
Pensions		15,373	(		124)		1,187		16,436
Employee benefits - unused
compensated absences		4,812	(		153)		-		4,659
Impairment of assets		1,716			141		-		1,857
Unrealised exchange loss		811			613		-		1,424
Unrealised loss		2,870	(		2,683)		-		187
Rent expense		-			763		-		763
	$	470,322		$	33,437	$	1,187	$	504,946
Deferred tax liabilities:
Temporary differences
Unrealised gain on financial
instruments	($	81)	($		503)	$	-	($	584)
	$	470,241		$	32,934	$	1,187	$	504,362

D. The Company’s income tax returns through 2018 have been assessed and approved by the Tax Authority, and there were no disputes existing between the Company and the Authority as of March 18, 2021.

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(26) EARNINGS PER SHARE (“EPS”)

Basic earnings per share Profit attributable to ordinary stockholders Diluted earnings per share Profit attributable to ordinary stockholders Assumed conversion of all dilutive potential ordinary shares Employees' stock option Employees' compensation Profit attributable to ordinary stockholders plus assumed conversion of all dilutive potential ordinary shares Basic earnings per share Profit attributable to ordinary stockholders Diluted earnings per share Profit attributable to ordinary stockholders Assumed conversion of all dilutive potential ordinary shares Employees' stock option Employees' compensation Profit attributable to ordinary stockholders plus assumed conversion of all dilutive potential ordinary shares	Weighted average number of shares outstanding EPS Amount aftertax (sharesinthousands) (indollars) 282,067 $ 790,739 0.36 $ 282,067 $ 790,739 - - - 1,450 282,067 $ 792,189 0.36 $ For theyear ended December31,2020 For theyear ended December31,2019	Weighted average number of shares outstanding EPS Amount aftertax (sharesinthousands) (indollars) 282,067 $ 790,739 0.36 $ 282,067 $ 790,739 - - - 1,450 282,067 $ 792,189 0.36 $ For theyear ended December31,2020 For theyear ended December31,2019	Weighted average number of shares outstanding EPS Amount aftertax (sharesinthousands) (indollars) 282,067 $ 790,739 0.36 $ 282,067 $ 790,739 - - - 1,450 282,067 $ 792,189 0.36 $ For theyear ended December31,2020 For theyear ended December31,2019
	Amount aftertax 216,656 $ 216,656 $ - - 216,656 $	Weighted average number of shares outstanding (sharesinthousands) 790,739 790,739 - 1,336 792,075	EPS (indollars)
			0.27 $
			0.27 $

For the years ended December 31, 2020 and 2019, some abovementioned stock options issued are anti-dilutive, therefore they were not included in the EPS calculation.

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(27) SUPPLEMENTAL CASH FLOW INFORMATION

A. Investing activities with partial cash payments

					For the years ended December 31,	For the years ended December 31,	For the years ended December 31,	For the years ended December 31,	For the years ended December 31,	For the years ended December 31,	For the years ended December 31,	For the years ended December 31,
					2020							2019
Purchase of property, plant	and	equipment			$	76,341			$			24,710
Add: Beginning balance of payable
on equipment						28,117						19,332
Less: Ending balance of payable		on
equipment				(		39,929)		(				28,117)
Cash paid for acquisition of property,
plant and equipment					$	64,529			$			15,925
B. Investing activities with no	cash flow effects:
					For the years ended December 31,
					2020							2019
(a) Prepayments for equipment reclassified to
property, plant and equipment					$	63,554			$			82,142
(b) Property, plant and equipment reclassified
to intangible assets					$		1,161		$			6,500
CHANGES IN LIABILITIES FROM FINANCING ACTIVITIES
							Guarantee			Liabilities from
		Short-term		Lease			deposits					financing
		borrowings		liabilities			received				activities-gross
At January 1, 2020	$		-	$	606,034	$			-		$	606,034
Changes in cash flow from
financing activities		9,494		(	9,772)		1,300					1,022
Changes in other non-cash
items			-	(	29,580)				-	(		29,580)
At December 31, 2020	$	9,494		$	566,682	$	1,300				$	577,476
							Guarantee			Liabilities from
		Short-term		Lease			deposits					financing
		borrowings		liabilities			received				activities-gross
At January 1, 2019	$	61,694		$	-	$	1,618				$	63,312
Effect on retrospective
application and restatement			-		900,288				-			900,288
Changes in cash flow from
financing activities	(	61,694)		(	11,335)	(	1,618)			(		74,647)
Changes in other non-cash
items			-	(	282,919)				-	(		282,919)
At December 31, 2019	$		-	$	606,034	$			-		$	606,034

(28) CHANGES IN LIABILITIES FROM FINANCING ACTIVITIES

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7. RELATED PARTY TRANSACTIONS

• (1) Parent and ultimate controlling party

The ultimate parent and ultimate controlling party of the Company is Uni-President Enterprises Corp.

• (2) Names of related parties and relationship

Names of related parties Relationship with the Company

Uni-President Enterprises Corp.

Ultimate parent company

SciAnda (Changshu) Pharmaceuticals, Ltd.

SciAnda (Changshu) Pharmaceuticals, Ltd. Subsidary ScinoPharm Singapore Pte Ltd. Subsidary SciAnda Shanghai Biochemical Technology, Subsidary Ltd.

ScinoPharm Singapore Pte Ltd.

President Securities Corp.

Associate of ultimate parent company

• (3) Significant transactions and balances with related parties

• A. Operating revenue:

gnificant transactions and balances with related parties Operating revenue:
SciAnda (Changshu) Pharmaceuticals, Ltd. Subsidiaries	For the years ended December 31,
	2020 2019 13,451 $ 724 $ 4,942 18,522 18,393 $ 19,246 $

The terms of sales and collection of the Company from related parties were the same with third parties. Collections are made in 90 days after shipment of goods.

• B. Purchases

SciAnda (Changshu) Pharmaceuticals, Ltd. Subsidiaries	For the years ended December 31,
	2020 2019 387,725 $ 335,838 $ 52 9,873 387,777 $ 345,711 $

The terms of purchases and payment of the Company from related parties were the same with third parties. Payments are made in 90 days after receipt of goods.

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C. Other expenses

Other expenses
Other revenue Other receivables Accounts payable Management service fees: －Subsidiaries －Ultimate parent company －Associates of ultimate parent company Management consultancy revenue: －Subsidiaries Joint loan guarantee revenue: －Subsidiaries Subsidiaries SciAnda (Changshu) Pharmaceuticals, Ltd. Subsidiaries	2020 2019 11,101 $ 8,864 $ 4,592 6,935 2,250 2,091 17,943 $ 17,890 $ Forthe years endedDecember31, 2020 2019 13,305 $ 13,699 $ 414 $ 2,095 $ For theyears ended December31, December31,2020 December31,2019 6,348 $ 5,697 $ December31,2020 December31,2019 36,565 $ 43,725 $ 33 1,792 36,598 $ 45,517 $
		13,699 $
		2,095 $
		December31,2019
		5,697 $
		December31,2019
		43,725 $ 1,792
		45,517 $

D. Other revenue

E. Other receivables

F. Accounts payable

G. Endorsements and guarantees provided to related parties

Details of endorsement and guarantees:

SciAnda (Changshu) Pharmaceuticals, Ltd.	Nature ofsuretyship Financial gurantee	December31,2020 1,005,928 $	December31,2019
			2,063,467 $

As of December 31, 2020 and 2019, the actual drawn amounts, which are guaranteed by the － Company to the subsidiaries, were $ and $144,234, respectively.

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(4) Key management compensation

Key management compensation
		Forthe years ended		December31,
		2020		2019
Salaries and other short-term employee benefits	$	50,853	$	42,905
Share-based payments		20		542
Post-employment benefits		694		692
Termination benetfits		1,470		1,470
	$	53,037	$	45,609

8. PLEDGED ASSETS

Details of the Company’s assets pledged as collateral are as follows:

Assets December 31, 2020 Time deposits (Note) 29,270 $	December 31, 2019 Purpose ofcollateral 29,270 $ Customs duty and performance guarantee	Purpose ofcollateral

Note: Listed as ‘Other financial assets - non-current’

9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNISED CONTRACT

COMMITMENTS

• (1) As of December 31, 2020 and 2019, the Company’s unused letters of credit amounted to $7,536 and $7,707, respectively.

• (2) As of December 31, 2020 and 2019, the Company’s remaining balance due for construction in progress and prepayments for equipment was $1,485 and $18,500, respectively.

• (3) Information about endorsement and guarantee to others is provided in Note 7(3) G.

• SIGNIFICANT DISASTER LOSS: None.

11. SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DATE: None.

12. OTHERS

(1) Capital management

The Company’s objectives on managing capital are to safeguard the Company’s ability to continue as a going concern in order to provide returns for shareholders, to maintain an optimal capital structure, to reduce the cost of capital and to maintain an adequate capital structure to enable the expansion and enhancement of equipment. In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return of capital to shareholders, and issue new shares or sell assets to reduce debts.

(2) Financial instruments

• A. Financial instruments

For details of the Company’s financial instruments by category, please refer to Note 6.

• B. Risk management policies

• (a)The Company’s activities expose it to a variety of financial risks: market risk (including foreign exchange risk, price risk and interest rate risk), credit risk and liquidity risk.

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• (b)The Company’s treasury identifies, evaluates and hedges financial risks closely with the Company’s operating units. The Board provides written principles for overall risk management, as well as written policies covering specific areas and matters, such as use of derivative financial instruments and investment of excess liquidity.

• (c)Information about derivative financial instruments that are used to hedge financial risk are provided in Note 6(2).

• C. Significant financial risks and degrees of financial risks

• (a) Market risk

  • I. Foreign exchange rate risk

  • (i) The Company operates internationally and is exposed to foreign exchange risk arising from the transations of the Company used in various functional currency, primarily with respect to USD. Foreign exchange risk arises from future commercial transactions, recognised assets and liabilities.

  • (ii) To manage their foreign exchange risk arising from future commercial transactions and recognised assets and liabilities, entities in the Company are required to hedge their foreign exchange risk exposure using forward foreign exchange contracts. However, the Company does not adopt hedging accounting. Details of financial assets or liabilities at fair value through profit or loss are provided in Note 6(2).

  • (iii) The Company’s businesses involve some non-functional currency operations (the Company’s and certain subsidiaries’ functional currency: NTD; other subsidiaries’ functional currency: CNY). The information on assets and liabilities denominated in foreign currencies whose values would be materially affected by the exchange rate fluctuations is as follows:

(Foreign currency functional currency) Financial assets Monetary items USD:NTD CNY:NTD Financial liabilities Monetary items USD:NTD EUR:NTD CNY:NTD		December31,2020	December31,2020	Book value (NTD)
		Foreign currency amount (inthousands) 14,460 $ 61 2,243 207 1,208	Exchangerate 28.48 4.363 28.48 35.02 4.363
				411,821 $ 266 63,881 7,249 5,271

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		December31,2019	December31,2019	December31,2019
		Foreign currency				Book value
	amount (inthousands)		Exchangerate			(NTD)
(Foreign currency
functional currency)
Financial assets
Monetary items
USD:NTD	$	21,606		29.98	$	647,748
EUR:NTD		32		33.59		1,075
CNY:NTD		85		4.305		366
Financial liabilities
Monetary items
USD:NTD		2,227		29.98		66,765
EUR:NTD		447		33.59		15,015
CNY:NTD		479		4.305		2,062

• (iv)As of December 31, 2020 and 2019, if the NTD:USD exchange rate appreciates/depreciates by 5% with all other factors remaining constant, the effect on the Company’s net profit after tax for the years ended December 31, 2020 and 2019 would increase/decrease by $13,918 and $23,239, respectively. If the NTD:EUR and NTD:CNY exchange rate appreciates/depreciates by 5% with all other factors remaining constant, the effect on the Company’s net profit after tax for the years ended December 31, 2020 and 2019 is immaterial.

• (v)Total exchange loss including realised and unrealised arising from significant foreign exchange variation on the monetary items held by the Company for the years ended December 31, 2020 and 2019 amounted to $23,322 and $2,409, respectively.

• II. Price risk

The Company’s equity securities, which are exposed to price risk, are the held financial assets at fair value through profit or loss, financial assets at fair value through other comprehensive income. To manage its price risk arising from investments in equity securities, the Company diversifies its portfolio and set stop-loss amounts for these instruments. The Company expects no significant market risk.

III. Cash flow and fair value interest rate risk

• (i)The Company’s main interest rate risk arises from short-term borrowings with variable rates and exposes the Company to cash flow interest rate risk. During the years ended December 31, 2020 and 2019, the Company’s borrowings at variable rate were denominated in USD.

• (ii)The Company’s borrowings are measured at amortised cost. The borrowings are periodically contractually repriced and to that extent are also exposed to the risk of future changes in market interest rates.

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• (iii)If the borrowing interest rates had increased/decreased by 10% with all other variables held constant, the effect on post-tax profit for the years ended December 31, 2020 and 2019 are immaterial.

• (b) Credit risk

• I. Credit risk refers to the risk of financial loss to the Company arising from default by the clients or counterparties of financial instruments on the contract obligations. The main factor is that counterparties could not repay in full the accounts receivable based on the agreed terms.

• II. The Company manages its credit risk taking into consideration the entire Company’s concern. For banks and financial institutions, only independently rated parties with a minimum rating of 'A' are accepted. According to the Company’s credit policy, the Company is responsible for managing and analysing the credit risk for each of the new clients before standard payment and delivery terms and conditions are offered. Internal risk control assesses the credit quality of the customers, taking into account their financial position, past experience and other factors. Individual risk limits are set based on internal or external ratings in accordance with limits set by the Board of Directors. The utilisation of credit limits is regularly monitored.

• III. The Company adopts the following assumption under IFRS 9: If the contract payments were past due over 30 days based on the terms, there has been a significant increase in credit risk on that instrument since initial recognition.

• IV. The Company manages its credit risk, whereby if the contract payments are past due over 180 days based on the terms, there has been impairment.

• V. The Company classifies customers’ accounts receivable in accordance with credit rating of customer and credit risk on trade. The Company applies the simplified approach using the provision matrix to estimate expected credit loss, and use the forecastability to adjust historical and timely information to assess the default possibility of accounts receivable. Movements in relation to the Company applying the simplified approach to provide loss allowance for accounts receivable are as follows:

			For theyears ended December31,	For theyears ended December31,
			2020	2019
At January 1		$	236	$	34
(Gain on reversal of) expected
credit losses	(		197)		202
At December 31		$	39	$	236

(c) Liquidity risk

• I. Cash flow forecasting is performed by the Company’s treasury department which monitors rolling forecasts of the Company’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed

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borrowing facilities at all times so that the Company does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities.

• II. The Company has undrawn borrowing facilities amounting to $2,799,066 and $3,058,960 as of December 31, 2020 and 2019, respectively.

• III. The following table comprises the Company’s non-derivative financial liabilities and derivative financial liabilities with gross-amount settlement that are grouped by their maturity. Non-derivative financial liabilities are analysed from the balance sheet date to the contract maturity date, and derivative financial liabilities are analysed from the balance sheet date to the expected maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.

December 31, 2020 Short-term borrowings Notes payable Accounts payable Accounts payable - related parties Other payables Lease liabilities Guarantee deposits received Non-derivative financial liabilities: December31,2019 Notes payable Accounts payable Accounts payable - related parties Other payables Lease liabilities Non-derivative financial liabilities:	Less than 1year 9,500 $ 1,173 126,820 36,598 308,560 16,599 - Less than 1year 1,353 $ 93,643 45,517 285,292 16,112	Between 1 and 2years - $ - - - - 16,259 1,300 Between 1 and2years - $ - - - 16,112	Between 2 and5 years - $ - - - - 45,712 - Between 2 and 5 years - $ - - - 48,337	More than 5 years
				- $ - - - - 655,200 - More than 5 years
				- $ - - - 708,937

(3) Fair value information

• A. The different levels that the inputs to valuation techniques are used to measure fair value of financial and non-financial instruments have been defined as follows:

Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date. A market is regarded as active where a market in which transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis. The fair value of the Company’s investment in listed stocks is included in Level 1.

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• Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. The fair value of the Company’s investment in foreign exchange contracts is included in Level 2.

• Level 3: Unobservable inputs for the asset or liability. The fair value of the Company’s investment in equity investment without active market is included in Level 3.

• B. Financial instruments not measured at fair value

• The carrying amounts of cash and cash equivalents, accounts receivable, other receivables (including related parties), guarantee deposits paid, other financial assets - non-current, shortterm borrowings, notes payable, accounts payable (including related parties), other payables, guarantee deposits received are approximate to their fair values.

• C. The related information on financial instruments measured at fair value by level on the basis of the nature, characteristics and risks of the assets and liabilities are as follows:

the nature, characteristics and risks of	the assets and	liabilities are	as follows:
December31,2020 Assets: Recurring fair value measurements Financial assets at fair value through other comprehensive income Equity securities Liabilities: Recurring fair value measurements Financial liabilities at fair value through profit or loss Derivative instruments December31,2019 Assets: Recurring fair value measurements Financial assets at fair value through profit or loss Derivative instruments Financial assets at fair value through other comprehensive income Equity securities	Level 1 188,160 $ - $ Level 1 - $ 271,752 $	Level 2 - $ 2,172 $ Level 2 2,920 $ - $	Level3 119,955 $ - $ Level3 - $ 143,458 $	Total
				308,115 $
				2,172 $
				Total
				2,920 $
				415,210 $

• D. The methods and assumptions the Company used to measure fair value are as follows:

• (a)The instruments the Company used market quoted prices as its fair values (that is, Level 1) is listed below by characteristics:

Market quoted price

Listed shares Closing price

• (b)Except for financial instruments with active markets, the fair value of other financial instruments is measured by using valuation techniques or by reference to counterparty quotes.

~58~

The fair value of financial instruments measured by using valuation techniques can be referred to current fair value of instruments with similar terms and characteristics in substance, discounted cash flow method or other valuation methods, including calculated by applying model using market information available at the consolidated balance sheet date.

• (c)When assessing non-standard and low-complexity financial instruments, for example, debt instruments without active market, interest rate swap contracts, foreign exchange swap contracts and options, the Company adopts valuation technique that is widely used by market participants. The inputs used in the valuation method to measure these financial instruments are normally observable in the market.

• (d)Forward foreign exchange contracts are usually valued based on the current forward exchange rate.

• E. For the years ended December 31, 2020 and 2019, there was no transfer between Level 1 and Level 2.

• F. The following chart is the movement of Level 3 for the years ended December 31, 2020 and 2019:

			For the years ended	For the years ended	For the years ended	December 31,
			2020			2019
			Equityinstrument			Equityinstrument
At January 1		$	143,458		$	200,046
Loss recognised in other comprehensive
income	(		23,503)	(		56,588)
At December 31		$	119,955		$	143,458

• G. For the years ended December 31, 2020 and 2019, there was no transfer in(out) Level 3.

• H. The Company’s valuation procedures for fair value measurements is categorised within Level 3, which is to verify independent fair value of financial instruments. Such assessment is to ensure the valuation results are reasonable by applying independent information to make results close to current market conditions, confirming the resource of information is independent, reliable and in line with other resources and represented as the exercisable price, and frequently assess to make any other necessary adjustments to the fair value.

• I. The following is the qualitative information of significant unobservable inputs and sensitivity analysis of changes in significant unobservable inputs to valuation model used in Level 3 fair value measurement:

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Non-derivative equity instrument: Unlisted shares Non-derivative equity instrument: Unlisted shares	Fair value at December31,2020	Valuation technique	Significant unobservable input	Range (weighted average)	Relationship of inputs to fairvalue
	119,955 $ Fair value at December31,2019 143,458 $	Net asset value Valuation technique	Not applicable Significant unobservable input	－ Range (weighted average)	The higher the net asset value, the higher the fair value Relationship of inputs to fairvalue
		Net asset value	Not applicable	－	The higher the net asset value, the higher the fair value

• J. The Company has carefully assessed the valuation models and assumptions used to measure fair value. However, use of different valuation models or assumptions may result in different measurement. If the net assets value increased or decreased by 1% for Level 3, however, the effect on other comprehensive income for the years ended December 31, 2020 and 2019 is immaterial.

13. SUPPLEMENTARY DISCLOSURES

• According to current regulatory requirements, the Company is only required to disclose the information for the year ended December 31, 2020.

(1) Significant transactions information

• A. Loans to others: Please refer to table 1.

• B. Provision of endorsements and guarantees to others: Please refer to table 2.

• C. Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures): Please refer to table 3.

• D. Acquisition or sale of the same security with the accumulated cost exceeding $300 million or 20% of the Company’s paid-in capital: Please refer to table 4.

• E. Acquisition of real estate reaching $300 million or 20% of paid-in capital or more: None.

• F. Disposal of real estate reaching $300 million or 20% of paid-in capital or more: None.

• G. Purchases or sales of goods from or to related parties reaching $100 million or 20% of paid-in capital or more: Please refer to table 5.

• H. Receivables from related parties reaching $100 million or 20% of paid-in capital or more: None.

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• I. Trading in derivative instruments undertaken during the reporting periods: Please refer to Note 6(2).

• J. Significant inter-company transactions during the reporting periods: Please refer to table 6.

• (2) Information on investees

Names, locations and other information of investee companies (not including investees in Mainland China) ： Please refer to table 7.

• (3) Information on investments in Mainland China

• A. General information: Please refer to table 8.

• B. Significant transactions, either directly or indirectly through a third area, with investee companies in the Mainland Area: Please refer to table 2 and 5.

• (4) Major shareholders information

Major shareholders information: Please refer to table 9.

14. SEGMENT INFORMATION

• Not applicable.

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For the year ended December 31, 2020

Table 1

Expressed in thousands of NTD

ScinoPharm Taiwan, Ltd.

Loans to others

Number	Name	Name of counterparty	Account	Related parties	Maximum balance	Ending balance	Actual amount drawndown	Interest rate	Nature of financial activity (Note1)	Total transaction amount	Reason for financing	Allowance for doubtful accounts	Assets pledged	Assets pledged	Loan limit per entity (Note2)	Maximum amount available for loan (Note2)	Footnote
													Item	Value
1	SciAnda (Kunshan) Biochemical Technology, Ltd.	SciAnda (Changshu) Pharmaceuticals, Ltd.	Other receivables	Y	87,369 $	- $	- $	3.0%	2	- $	Additional operating capital and loan repayment	- $	－	- $	425,808 $	425,808 $	(Note 4)

Note 1: The code represents the nature of financing activities as follows:

1.Trading partner.

2.Short-term financing.

Note 2: (1) For trading partner: the maximum amount for individual trading partner shall not exceed the higher of purchase or sales amount of the most recent year or the current year, the maximum amount for total loan is 20% of its net worth.(2) For short-term financing: the maximum amount for individual is 20% of its net worth, the maximum amount for total loan is 40% of its net worth. If the Company loans to foreign subsidiaries, which the Company holds 100% ownership directly or indirectly, the maximum amount for the subsidiary is 100% of the Company's net worth.

Note 3: The numbers in the table that involves foreign currencies are expressed in New Taiwan Dollars according to the exchange rate posted on the date of the financial statements (CNY:NTD 1:4.363). Note 4: SciAnda (Kunshan) Biochemical Technology, Ltd. was merged into SciAnda (Changshu) Pharmaceuticals, Ltd. in August 2020.

Table 1, Page 1

ScinoPharm Taiwan, Ltd.

Table 2

Expressed in thousands of NTD

Provision of endorsements and guarantees to others

For the year ended December 31, 2020

Number	Endorser/ guarantor	Party being endorsed/guaranteed	Party being endorsed/guaranteed	Limit on endorsements/ guarantees provided for a single party （Note 2）	Maximum outstanding endorsement/ guarantee amount during theyear	Outstanding endorsement/ guarantee amount at December 31, 2020	Actual amount drawn down	Amount of endorsements/ guarantees secured with collateral	Ratio of accumulated endorsement/ guarantee amount to net asset value of the endorser/ guarantor company	Ceiling on total amount of endorsements/ guarantees provided （Note 2）	Provision of endorsements/ guarantees by parent company to subsidiary	Provision of endorsements/ guarantees by subsidiary to parent company	Provision of endorsements/ guarantees to the party in Mainland China	Footnote
		Companyname	Relationship with the endorser/ guarantor （Note 1）
0	ScinoPharm Taiwan, Ltd.	SciAnda (Changshu) Pharmaceuticals, Ltd.	1	10,529,403 $	2,089,077 $	1,005,928 $	- $	- $	9.55%	10,529,403 $	Y	N	Y	－

Note 1: The following code represents the relationship with the Company:

• 1.A company in which the Company directly and indirectly holds over 50% of the voting shares.

• Note 2: 1.The limit of total amount of endorsement is 50% of the Company's net worth, for 100% directly or indirectly owned subsidiaries, the maximum amount is 100% of its net worth. The limit of total amount of the Group's endorsement and guarantee is 100% of the Group's net worth.

• For any endorsement or guarantee provided by the Company due to business dealings, the amount of endorsement or guarantees shall be limited to the business dealing amount of the most recent year or the current year. The business dealing amount is product purchase or sale amount between the entities, whichever is higher.

Note 3: The numbers in the table that involves foreign currencies are expressed in New Taiwan Dollars according to the exchange rate posted on the date of the financial statements (CNY:NTD 1:4.363 ；USD:NTD 1:28.48).

Table 2, Page 1

ScinoPharm Taiwan, Ltd.

Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures) December 31, 2020

			December 31,	2020
Table 3 Securities held by	Marketable securities	Relationship with the securities issuer	General ledger account		As of December31,2020		Fairvalue Footnote Expressed in thousands of NTD
				Number of shares	Bookvalue	Ownership (%)	Fairvalue
ScinoPharm Taiwan, Ltd.	Stocks: Tanvex Biologics, Inc. Foresee Pharmaceuticals Co., Ltd. SYNGEN, INC.	The Company is a director of Tanvex Biologics, Inc. － －	Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through other comprehensive income - non-current Financial assets at fair value through profit or loss - non-current	28,800,000 2,100,000 245,000	119,955 $ 188,160 -	16.84% 2.06% 7.40%	119,955 $ 188,160 -	－ － －

Table 3, Page 1

Table 4

Expressed in thousands of NTD

ScinoPharm Taiwan, Ltd.

Acquisition or sale of the same security with the accumulated cost exceeding $300 million or 20% of the Company's paid-in-capital For the year ended December 31, 2020

Investor	Type of securities	General ledger account	Name of the counterparty	Relationship	Beginningbalance	Beginningbalance	Addition	Addition		Disposal	Disposal		Other increase(decrease)	Other increase(decrease)	Endingbalance	Endingbalance
					Number of shares (in thousands)	Amount	Number of shares (in thousands)	Amount	Number of shares (in thousands)	Saleprice	Bookvalue	Gain on disposal	Number of shares (in thousands)	Amount	Number of shares (in thousands)	Amount
SciAnda (Kunshan) Biochemical Technology, Ltd. (Note) SciAnda (Changshu) Pharmaceuticals, Ltd.	Structured Products: Fubon Bank (China) Co., Ltd. Structured Products Fubon Bank (China) Co., Ltd. Structured Products	Financial assets at amortised cost - current Financial assets at amortised cost - current	－ －	－ －	- -	172,220 $ -	- -	171,259 $ 436,711	- -	343,854 $ 438,430	342,519) ($ 436,711) (	1,335 $ 1,719	- -	960) ($ -	- -	- $ -

Note : SciAnda (Kunshan) Biochemical Technology, Ltd. was merged into SciAnda (Changshu) Pharmaceuticals, Ltd. in August 2020.

Table 4, Page 1

Table 5

Expressed in thousands of NTD

ScinoPharm Taiwan, Ltd.

• Purchases or sales of goods from or to related parties reaching $100 million or 20% of paid in capital or more For the year ended December 31, 2020

Purchaser/seller	Counterparty	Relationship with the counterparty			Transaction		transactions compared to third party Differences in transaction terms	transactions compared to third party Differences in transaction terms	Notes/accounts receivable(payable)	Notes/accounts receivable(payable)	Footnote
			Purchases(sales)	Amount	Percentage of total purchases(sales)	Credit term	Unitprice	Credit term	Balance	Percentage of total notes/accounts receivable(payable)
ScinoPharmTaiwan, Ltd. SciAnda (Changshu) Pharmaceuticals, Ltd.	SciAnda (Changshu) Pharmaceuticals, Ltd. ScinoPharm Taiwan, Ltd.	Subsidary The Company	Purchases (Sales)	387,725 $ 387,725) (	42% (88%)	Closes its accounts 90 days from the end of each month Closes its accounts 90 days from the end of each month	$ - -	－ －	36,565) ($ 36,565	(22%) 84%	－ －

Table 5, Page 1

Table 6

Expressed in thousands of NTD

ScinoPharm Taiwan, Ltd.

- Significant inter company transactions during the reporting period

For the year ended December 31, 2020

Number (Note 2)	Companyname	Counterparty	Relationship (Note3)		Transactions	Transactions
				General ledger account	Amount	Transaction terms	Percentage of consolidated total operating revenues or total assets(Note 4)
0 0 0 0 0 0	ScinoPharm Taiwan, Ltd. ScinoPharm Taiwan, Ltd. ScinoPharm Taiwan, Ltd. ScinoPharm Taiwan, Ltd. ScinoPharm Taiwan, Ltd. ScinoPharm Taiwan, Ltd.	SciAnda (Changshu) Pharmaceuticals, Ltd. SciAnda (Changshu) Pharmaceuticals, Ltd. SciAnda (Changshu) Pharmaceuticals, Ltd. SciAnda (Changshu) Pharmaceuticals, Ltd. SciAnda (Changshu) Pharmaceuticals, Ltd. SciAnda Shanghai Biochemical Technology, Ltd.	1 1 1 1 1 1	Purchases Management service revenue Sales Accounts payable Endorsements and guarantees Management service fee	387,725 $ 13,138 13,451 36,565 1,005,928 10,750	Closes its accounts 90 days from the end of each month － Closes its accounts 90 days from the end of each month － － －	13% － － － 8% －

Note 1: Significant inter-company transactions during the reporting periods are not disclosed since these were corresponding transactions. Only transactions over NT$10 million are material.

Note 2: The numbers filled in for the transaction company in respect of inter-company transactions are as follows:

(1) Parent company is ‘0’.

(2) The subsidiaries are numbered in order starting from ‘1’.

• Note 3: Relationship between transaction company and counterparty is classified into the following three categories:

(1) Parent company to subsidiary.

(2) Subsidiary to parent company.

(3) Subsidiary to subsidiary.

Note 4: Regarding percentage of transaction amount to consolidated total operating revenues or total assets, it is computed based on period-end balance of transaction to consolidated total assets for balance sheet accounts and

based on accumulated transaction amount for the period to consolidated total operating revenues for income statement accounts.

Note 5: The numbers in the table that involves foreign currencies are expressed in New Taiwan Dollars according to the exchange rate posted on the date of the financial statements (CNY:NTD 1:4.363 ； USD:NTD 1:28.48).

Table 6, Page 1

Table 7

Expressed in thousands of NTD

ScinoPharm Taiwan, Ltd.

Names, locations and other information of investee companies (not including investees in Mainland China) For the year ended December 31, 2020

Investor	Investee	Location	Main business activities	Initial investment amount	Initial investment amount	Shares held	as at December 31,2020	as at December 31,2020	Net profit (loss) of the investee for the year ended December 31,2020	Investment income (loss) recognised by the Company for the year ended December 31,2020	Footnote
				Balance as at December 31,2020	Balance as at December 31,2019	Number of shares	Ownership (%)	Book value
ScinoPharm Taiwan, Ltd. ScinoPharm Taiwan, Ltd.	SPT International, Ltd. ScinoPharm Singapore Pte Ltd.	Tortola, British Virgin Islands Singapore	Professional investment Professional investment	3,375,582 $ -	3,375,582 $ -	118,524,644 2	100.00 100.00	1,680,970 $ 125	101,127) ($ 13	104,633) ($ 13	Subsidiary Subsidiary

Note :Initial investment amount in the table that involves foreign currencies are expressed in New Taiwan Dollars according to exchange rate posted on the date of financial statements (USD:NTD 1:28.48).

Table 7, Page 1

ScinoPharm Taiwan, Ltd.

Table 8

Expressed in thousands of NTD

Information on investments in Mainland China － Basic information

For the year ended December 31, 2020

Investee in Mainland China	Main business activities	Paid-in capital	Investment method	Accumulated amount of remittance from Taiwan to Mainland China as of January 1, 2020	Amount remitted from Taiwan to Mainland China/ Amount remitted back to Taiwan for the year ended December 31,2020	Amount remitted from Taiwan to Mainland China/ Amount remitted back to Taiwan for the year ended December 31,2020	Accumulated amount of remittance from Taiwan to Mainland China as of December 31,2020	Net income of investee for the year ended December 31, 2020	Ownership held by the Company (direct or indirect)	Investment income (loss) recognised by the Company for the year ended December 31, 2020 （Note 2）	Book value of investments in Mainland China as of December 31, 2020	Accumulated amount of investment income remitted back to Taiwan as of December 31, 2020	Footnote
					Remitted to Mainland China	Remitted back to Taiwan
SciAnda (Changshu) Pharmaceuticals, Ltd. SciAnda Shanghai Biochemical Technology, Ltd.	Research, development, and manufacture of API and new drugs, sale produced products, etc. Import, export and sales of API and intermediates, etc.	3,317,920 $ 34,176	（Note 1） （Note 1）	3,310,071 $ 34,176	- $ -	- $ -	3,310,071 $ 34,176	100,904) ($ 37	100% 100%	100,904) ($ 37	1,725,768 $ 16,207	- $ -	Subsidary (Note 5) Subsidary

Companyname	Accumulated amount of remittance from Taiwan to Mainland China as of December 31,2020	Investment amount approved by the Investment Commission of the Ministry of Economic Affairs(MOEA)	Ceiling on investments in Mainland China imposed by the Investment Commission of MOEA(Note 3)
ScinoPharm Taiwan, Ltd.	$ 3,379,110	3,379,110 $	6,317,642 $

Note 1: Indirect investment in Mainland China through company set up in a third region, SPT International, Ltd.

Note 2: The investment income (loss) recognized by the Company for the year ended December 31, 2020 was based on audited financial statements of investee companies as of and for the year ended December 31, 2020. Note 3: The ceiling amount is 60% of the higher of net worth or consolidated net worth.

Note 4: The numbers in the table that involves foreign currencies are expressed in New Taiwan Dollars according to the exchange rate posted on the date of the financial statements (USD:NTD 1:28.48). Note 5: SciAnda (Kunshan) Biochemical Technology, Ltd. was merged into SciAnda (Changshu) Pharmaceuticals, Ltd. in August 2020.

Table 8, Page 1

ScinoPharm Taiwan, Ltd.

Major shareholders information

December 31, 2020

Table 9

Number of shares

Name of the keyshareholder	Common stock	Preferred stock	Ownership (%)	Footnote
Uni-President Enterprises Corp. National Development Fund, Executive Yuan	299,968,639 109,539,014	－ －	37.94% 13.85%	－ －

Note: The major shareholders information was derived from the data that the Company issued common shares (including treasury shares) and preference shares in dematerialised form which were registered and held by the shareholders above 5% on the last operating date of each quarter and was calculated by Taiwan Depository & Clearing Corporation.

The share capital which was recorded in the financial statements is different from the actual number of shares issued in dematerialised form because of the difference in the calculation basis.

Table 9, Page 1

SCINOPHARM TAIWAN, LTD. STATEMENT OF CASH AND CASH EQUIVALENTS DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Items Cash: Cash on hand Checking accounts Demand deposits－New Taiwan dollar －Foreign Currency Cash Equivalents: Time deposits－New Taiwan dollar Bills under repurchase agreements	Description Including USD$1,022 thousand @28.48 Other foreign currency deposits Due date from January 4, 2021 to December 31, 2021, interest rates at 0.4%~0.815%. Expired by January 7, 2021, interest rate at 0.25%	Amount
		30 $ 373 26,452 29,099 340
		56,294
		3,593,500 229,897
		3,823,397
		3,879,691 $

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SCINOPHARM TAIWAN, LTD. STATEMENT OF ACCOUNTS RECEIVABLE, NET DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Client Name Client A Client B Client C Client D Client E Client F Others (individually less than 5%) Less: Loss allowance	Description Amount Accounts receivable 113,265 $ 〞 43,162 〞 33,625 〞 31,912 〞 29,571 〞 26,355 〞 101,560 379,450 39) ( 379,411 $	Footnote
		－ － － － － － －

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SCINOPHARM TAIWAN, LTD. STATEMENT OF INVENTORIES DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Items Cost Net realisablevalue Raw materials 370,211 $ 398,375 $ Supplies 28,370 28,498 Work in process 362,983 459,103 Finished goods 687,202 1,216,519 1,448,766 2,102,495 $ Less: Allowance for market price decline 313,819) ( 1,134,947 $ Amount	Footnote
	(Note) 〞 〞 〞

Note: The method of net realisable value is provided in Note 4(11).

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SCINOPHARM TAIWAN, LTD.

STATEMENT OF CHANGES IN FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME - NON-CURRENT FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Name Tanvex Biologics, Inc. Foresee Pharmaceuticals Co., Ltd.	Number of shares Fairvalue 28,800,000 143,458 $ 4,661,269 271,752 33,461,269 415,210 $ Beginningbalance	Number of Number of shares Amount shares Amount - - $ - 23,503) ($ - 199,909 2,561,269) ( 283,501) ( - 199,909 $ 2,561,269) ( 307,004) ($ Additions Disposals	Endingbalance	Endingbalance	Amount 119,955 $ 188,160 308,115	Collateral	Footnote
	Number of shares 28,800,000 4,661,269 33,461,269		Number of shares 28,800,000 2,100,000 30,900,000	Ownership 16.84% 2.06%
						None 〞	－ －

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SCINOPHARM TAIWAN, LTD.

STATEMENT OF CHANGES IN INVESTMENTS ACCOUNTED FOR USING EQUITY METHOD

FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Investees	Number of shares (in thousands) Amount 118,525 1,763,097 $ - 112 118,525 1,763,209 $ Beginningbalance	Addition	Amount 22,505 $ 13 22,518 $ s	Number of shares (in thousands) Amount - 104,632) ($ - - - 104,632) ($ Disposals	Endingbalance	Endingbalance	Amount 1,680,970 $ 125 1,681,095 $	Market value or	Total amount 1,745,203 $ 125 1,745,328 $ net assets value	Collateral
	Number of shares (in thousands)	Number of shares (in thousands)			Number of shares (in thousands)	Ownership		Unit Price (in dollars) 14.72 $ 62,517
SPT International, Ltd. ScinoPharm Singapore Pte Ltd.	118,525 - 118,525	- - -			118,525 -	100.00% 100.00%				None 〞
					118,525

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SCINOPHARM TAIWAN, LTD. STATEMENT OF CHANGES IN PROPERTY, PLANT AND EQUIPMENT - COST FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Please refer to Note 6(7).

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SCINOPHARM TAIWAN, LTD. STATEMENT OF CHANGES IN PROPERTY, PLANT AND EQUIPMENT - ACCUMULATED DEPRECIATION AND IMPAIRMENT FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Please refer to Note 6(7), the depreciation methods and useful lives are provided in Note 4(13).

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SCINOPHARM TAIWAN, LTD. STATEMENT OF CHANGES IN RIGHT-OF-USE ASSETS - COST FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Items Land Buildings and structures	Beginning balance 617,369 $ - 617,369 $	Additions Decreases 37,655 $ 69,935) ($ 2,700 - 40,355 $ 69,935) ($	Ending balance 585,089 $ 2,700 587,789 $	Footnote
				(Note) －

Note: The increase and decrease in the current period are due to the increase and decrease of monthly rents in January and August of 2020, respectively.

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SCINOPHARM TAIWAN, LTD.

STATEMENT OF CHANGES IN RIGHT-OF-USE ASSETS – ACCUMULATED DEPRECIATION FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Items Beginning balance Additions Land 15,148 $ 12,457 $ Buildings and structures - 337 15,148 $ 12,794 $	Decreases - $ - - $	Ending balance Footnote 27,605 $ － 337 － 27,942 $

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SCINOPHARM TAIWAN, LTD. STATEMENT OF CHANGES IN DEFERRED INCOME TAX ASSETS FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Please refer to Note 6(25).

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SCINOPHARM TAIWAN, LTD. STATEMENT OF ACCOUNTS PAYABLE DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

VendorName	Description Accounts payable 〞 〞 〞 〞 〞	Amount
Vendor A Vendor B TRANS CHIEF CHEMICAL INDUSTRY CO., LTD. LIANGE SHYI TRADING CO., LTD. Vendor C Others (individually less than 5%)		39,473 $ 15,196 12,964 10,539 6,904 41,744
		126,820 $

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SCINOPHARM TAIWAN, LTD. STATEMENT OF OTHER PAYABLES DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Please refer to Note 6(11).

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SCINOPHARM TAIWAN, LTD. STATEMENT OF LEASE LIABILITIES - NON-CURRENT DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Items Land Buildings and structures	Description Lease period Discountrate Amount － Due date from March, 2018 to 1.13% 564,317 $ December, 2068 － Due date from October, 2020 to October, 2022 0.84% 2,365 566,682 Less: Current portion 16,500) ( 550,182 $

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SCINOPHARM TAIWAN, LTD. STATEMENT OF OPERATING REVENUE FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Items Quantity Amount API 31,687 KG 2,805,670 $ Injection product 122,060 package 146,322 Less: Sales returns and discounts 27,111) ( 2,924,881 Technical services 81,718 Other operating revenue 39,621 Operating revenue 3,046,220 $	Footnote
	－ － － － －

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SCINOPHARM TAIWAN, LTD. STATEMENT OF OPERATING COSTS FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

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Items			Amount
Raw materials, beginning of year		$	325,013
Add: Raw materials purchased			804,938
Gains on physical inventory			122
Less: Losses on scrap inventory	(		326)
Transferred to expenses	(		8,876)
Sale of raw materials	(		8,331)
Raw materials, end of year	(		370,211)
Raw materials used during the year			742,329
Supplies, beginning of year			24,771
Add: Supplies purchased			22,630
Gains on physical inventory			40
Less: Transferred to expenses	(		7,160)
Supplies, end of year	(		28,370)
Supplies used during the year			11,911
Direct labor			169,786
Manufacturing expenses			583,457
Under applied manufacturing overhead	(		137,181)
Manufacturing cost			1,370,302
Work in process, beginning of year			313,720
Add: Work in process purchased			79,990
Less: Losses on physical inventory	(		192)
Transferred to expenses	(		7,265)
Sale of work in process	(		18,780)
Work in process, end of year	(		362,983)
Cost of finished goods			1,374,792

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SCINOPHARM TAIWAN, LTD.

STATEMENT OF OPERATING COSTS (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Items			Amount
Finished goods, beginning of year		$	825,633
Add: Finished goods purchased			178,584
Less: Losses on scrap inventory	(		43,182)
Losses on physical inventory	(		489)
Transferred to expenses	(		57,945)
Finished goods, end of year	(		687,202)
Cost of goods manufactured and sold			1,590,191
Sale of raw materials			8,331
Sale of work in process			18,780
Cost of goods sold			1,617,302
Losses on scrap inventory			43,508
Losses on physical inventory			519
Under applied manufacturing overhead			137,181
Reversal of allowance for inventory market price decline	(		74,623)
Cost of sales			1,723,887
Revenue from sale of scraps	(		1,773)
Technical service cost			36,358
Operating cost		$	1,758,472

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SCINOPHARM TAIWAN, LTD. STATEMENT OF MANUFACTURING EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Items Salaries and wages Repair and maintenance expense Utilities expense Depreciation Waste disposal fee Others (individually less than 5%)	Amount 151,934 $ 49,866 80,883 169,805 41,104 89,865 583,457 $	Footnote
		－ － － － － －

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SCINOPHARM TAIWAN, LTD. STATEMENT OF TECHNICAL SERVICE COST FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Items Salaries and wages Depreciation Repair and maintenance expense Others (individually less than 5%)	Amount 9,858 $ 3,422 1,896 21,182 36,358 $	Footnote
		－ － － －

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SCINOPHARM TAIWAN, LTD. STATEMENT OF SELLING EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Items Salaries and wages Freight Advertising expense Commission Royalty Outsourced service fee Others (individually less than 5%)	Amount 50,483 $ 20,066 9,281 30,423 13,690 18,420 32,904 175,267 $	Footnote
		－ － － － － － －

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SCINOPHARM TAIWAN, LTD. STATEMENT OF GENERAL AND ADMINISTRATIVE EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Items Salaries and wages Insurance expense Repair and maintenance expense Depreciation Professional service fee Others (individually less than 5%)	Amount 158,559 $ 23,851 27,782 81,788 24,716 138,764 455,460 $	Footnote
		－ － － － － －

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SCINOPHARM TAIWAN, LTD. STATEMENT OF RESEARCH AND DEVELOPMENT EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Items Salaries and wages Repair and maintenance expense Depreciation Research expense Others (individually less than 5%)	Amount 70,820 $ 13,474 24,569 69,614 27,887 206,364 $	Footnote
		－ － － － －

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SCINOPHARM TAIWAN, LTD. STATEMENT OF EMPLOYEE BENEFITS, DEPRECIATION AND AMORTIZATION BY FUNCTION FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan Dollars)

Please refer to Note 6(23) and 6(24).

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