Business Conduct

Anti-Corruption and Anti-Bribery Management

Haizhou Pharmaceutical adheres to the principle of honesty and trustworthiness, complies with laws and regulations, follows business ethics, and participates in market competition in a fair, just, and open manner, safeguarding the legitimate rights and interests of consumers, employees, partners, and the public.  

The company continuously improves its compliance management system and has established systems such as the Integrity Early Warning Mechanism, Provisions on Integrity Talks, Integrity Risk Points and Prevention Measures, Administrative Reception and Gift Management Measures, and Employee Code of Conduct for Integrity.  

Employees in the procurement department have signed the Haizhou Employee Anti-Commercial Bribery Commitment Letter, committing to uphold integrity responsibilities and oppose corruption and bribery.  

Employees of Haizhou Pharmaceutical regularly participate in training on the above regulations and systems to ensure their implementation. There have been no individual violations recorded this year, contributing to a more robust management system for achieving the company’s strategic and operational goals.  

The company also conducts training for suppliers on social responsibility, including the study of relevant laws and regulations.  

Annual evaluations, on-site audits, supplier codes of conduct, and social responsibility risk assessments have been carried out, and suppliers have signed the Supplier Code of Conduct and Integrity Agreement.

The company deepens comprehensive and strict governance, advances party integrity and the anti-corruption campaign, and continuously promotes supervision to be normalized, precise, and specific.  

A supervision system has been established to ensure detailed and effective daily oversight.  

Through regular training, party meetings, and reminders, the company promotes integrity awareness among all employees.

Posters outlining the Employee Code of Conduct for Integrity, Ten Prohibitions for Employee Integrity, Six “Do-Nots” for Upholding Business Integrity, Anti-Corruption for All, Oversight by All are displayed in the company premises.  

Employees have also signed the Corporate Employee Integrity Commitment Letter.  

Employees can report violations through suggestion boxes and reporting hotlines.

Haizhou Pharmaceutical regularly organizes relevant departments to participate in Prevention of Job-Related Crimes training.  

The Party Branch conducts activities on Party Day, including the Annual Summary Report on the Construction of a Clean Private Enterprise, and carries out party-building and integrity work deployments to continuously improve the construction of a clean enterprise.

Haizhou Pharmaceutical signs Integrity Agreements with customers and suppliers, which include supervision and reporting hotline information.

Haizhou Pharmaceutical regularly conducts social responsibility and credit background investigations of suppliers.

Intellectual Property Management

Haizhou Pharmaceutical places great emphasis on the management and protection of intellectual property (IP) and supports technological innovation.  

In 2021, the company obtained the IP Management System Certification (scope: IP management related to the production and sales of APIs, organic intermediates 5-amino-2,4,6-triiodoisophthaloyl chloride/hydroxyethyl iodide/iodide hydrolysate).

Haizhou Pharmaceutical actively files patent applications to protect its IP.  

By the end of 2023, the company held a total of 30 domestic invention patents, with 2 additional patents added in 2024.  

Among them, 29 were self-developed and 3 were acquired through transfer.

Some of the patents obtained by Haizhou Pharmaceutical are listed below and can also be queried in the China Patent Search System.

Ten Prohibitions for Employee Integrity in Conduct

1. **It is prohibited to take advantage of one's position to embezzle or misappropriate company property.**  

2. **It is prohibited to use public funds for receptions unrelated to business activities.**  

3. **It is prohibited to handle personal affairs under the guise of official business or to take detours for personal gain. All official travel must be kept simple, and reimbursement of travel expenses must not exceed prescribed standards.**  

4. **It is prohibited to solicit or accept cash gifts, securities, or other valuables from contractors, suppliers, or other business parties under the pretext of price inquiries or contract signing.**  

5. **It is prohibited to request reimbursement from contractors, suppliers, or other business parties for any expenses that should be personally borne by the employee.**  

6. **It is prohibited to engage in transactions with one's relatives or friends by taking advantage of one's position. If an employee must conduct business with relatives or friends for the benefit of the company, they must truthfully disclose such relationships to the company.**  

7. **It is prohibited to inflate contract prices in service procurement, material purchasing, or other transactions due to personal or family relationships, thereby harming the company’s interests.**  

8. **It is prohibited to lower contractual performance standards or prematurely fulfill contractual obligations due to personal relationships.**  

9. **It is prohibited to deliberately make things difficult for contractual parties, or to unreasonably raise performance standards or delay fulfillment of obligations in violation of the contract.**  

10. **It is prohibited to attend banquets or entertainment activities arranged by business partners. If refusal is genuinely impractical, prior approval from the company must be obtained.**

Six “Do-Nots” for Upholding Business Integrity and Compliant Operations

1. **Do not form cliques or engage in interest-driven collusion with staff or leaders of Party and government organs, or seek to improperly influence public decision-making, official execution, or personnel selection.**  

2. **Do not offer or give gifts, cash, securities, or other valuables to public officials (i.e., personnel closely related to enterprise development) or their family members or specific associates.**  

3. **Do not engage in interest transfer to public officials through means such as dry shares, joint investments, profit-sharing,定向储蓄 (targeted savings), financial management services, or by arranging business deals or high-salary positions (including nominal salaries) for their family members or specific associates.**  

4. **Do not engage in interest transfer by borrowing money at high interest rates, lending at low rates, providing money or goods under the guise of loans, or through gambling, etc.**  

5. **Do not host public officials in internal canteens, self-built clubs, or other private venues.**  

6. **Do not arrange or reimburse travel, fitness, entertainment, or other activities for public officials or their family members and specific associates under any pretext, especially when such expenses should be personally borne.**