Stock abbreviation: 健康元
Stock code:600380
FOR THE HEALTH FOR THE FUTURE
为明天 为健康
Joincare Pharmaceutical Group Industry Co., Ltd.
lnterim Report 2022
【Mission】For the health, For the future
【Vision】Attentively Develop High-quality Medicines and lnnovative Medicines
【Core Values】Putting People at the first place, Valuing Workmanship and Quality,
Pursuing Innovation and lntegrity, Promoting Cooperation and Sharing
Important Notice
I The Board of Directors (the “Board”), the Board of Supervisors and directors, supervisors and senior management of the
Company hereby warrant the truthfulness, accuracy and completeness of the contents of the interim report (the “Report”),
and that there are no false representations, misleading statements or material omissions contained in the Report, and
severally and jointly accept responsibility.
II All the directors of the Company attended the Board meeting.
III The interim report of the Company is unaudited.
IV Mr. Zhu Baoguo (朱保国), the person-in-charge of the Company, and Mr. Qiu Qingfeng (邱庆丰), the person-in-charge
of the Company’s accounting work and the person-in-charge of the accounting department (the head of the accounting
department), declare that they hereby warrant the truthfulness, accuracy and completeness of the financial statements
contained in the Report.
V Profit distribution plan or plan for conversion of capital reserve to share capital approved by the Board during the
Reporting Period
Not applicable
VI Risk declaration for the forward-looking statements
√ Applicable □ N/A
The Report contains forward-looking statements which involve the future plans, development strategies, etc. of the
Company, yet do not constitute substantive undertakings of the Company to investors. Investors should exercise caution
prior to making investment decisions.
VII Whether there is non-operating use of funds by the controlling shareholder and their related parties
No
VIII Whether there is a violation of the prescribed decision-making procedures to provide external guarantees
No
IX Whether more than half of directors cannot warrant the truthfulness, accuracy and completeness of the Report disclosed
by the Company
No
X Significant risk warnings
There is no exceptionally significant risk that will have a material impact on the productions and operations of the
Company during the Reporting Period. The Company has described various risks related to productions and operations
that the Company may face and the corresponding response measures taken. Please refer to “Risks” in Chapter 3
“Management Discussion and Analysis”.
XI Others
□ Applicable √ N/A
XII The Report is prepared in both Chinese and English. In case of any discrepancies between two versions, the Chinese
version shall prevail.
FOR THE HEALTH FOR THE FUTURE
lnterim Report 2022 1
Table of
Contents
Financial Highlights 2
Chapter 1 Definitions 4
Chapter 2 Company Profile and Major Financial Indicators 7
Chapter 3 Management Discussion and Analysis 12
Chapter 4 Corporate Governance 35
Chapter 5 Environmental and Corporate Social Responsibility 40
Chapter 6 Major Events 67
Chapter 7 Changes in Equity and Shareholders 82
Chapter 8 Information on Preferred Shares 87
Chapter 9 Information on Bonds 89
Chapter 10 Financial Statements 91
List of documents available The Financial Statements signed and sealed by the person-in-charge of
for inspection the Company, the person-in-charge of the Company’s accounting work
and the person-in-charge of the accounting department (the head of the
accounting department)
The original copies of all documents and announcements of the Company
which have been disclosed to the public on the website designated by
CSRC during the Reporting Period
2 Joincare Pharmaceutical Group Industry Co., Ltd.
Financial Highlights
1. Major financial indicators (RMB100 million)
78.35 85.65
8.01 8.04
6.87
5.98
9.31% 16.57% 34.47%
Revenues Net profit attributable Net profit attributable to shareholders
to shareholders of the of the listed company after deducting
listed company the extraordinary gain or loss
EPS (RMB/share) EPS-Diluted (RMB/share)
0.4235 0.4232
0.3514 0.3504
Reporting Period
Same Period of
Last Year
20.52% 20.78%
2. Principal businesses (RMB100 million)
56.51% Revenues 32.64% Chemical pharmaceuticals
47.99
from principal 27.72 Chemical APIs and intermediates
businesses:
84.92 Traditional Chinese medicine
6.06% Diagnostic reagents and equipment
5.14
0.64% 4.07%
Health care products
0.55 3.46
Interim Report 2022 3
3. Segment growth (RMB100 million)
Chemical pharmaceuticals
By segment Revenue Growth
17.81
Gastroenterology -8.16%
13.44
Gonadorelin
hormone 6.82%
6.83
Anti-infection 3.28%
5.61
Respiratory 259%
2.64
Psychiatry 36.26%
By product Revenue Growth
27.72
Chemical APIs and
22.70%
intermediates
5.14
Traditional Chinese
medicine -18.74%
3.46
Diagnostic reagents
and equipment -11.43%
1
Definitions
Interim Report 2022 5
Chapter 1 Definitions
In this Report, unless the context otherwise requires, the following expressions shall have the following meanings:
Definitions of common terms
CSRC Refers to China Securities Regulatory Commission
SSE Refers to Shanghai Stock Exchange
SZSE Refers to Shenzhen Stock Exchange
Baiyeyuan or the Controlling Refers to Shenzhen Baiyeyuan Investment Co., Ltd.* (深圳市百业源投资有限公司)
Shareholder
Company or the Company Refers to Joincare Pharmaceutical Group Industry Co., Ltd.*
(健康元药业集团股份有限公司)
GDR Refers to Global Depositary Receipts
GMP Refers to Good Manufacturing Practice
GSP Refers to Good Supply Practice
BE Refers to Bioequivalence
BLA Refers to Biologics License Application
WHO Refers to World Health Organization
CDE Refers to Center for Drug Evaluation
EUA Refers to Emergency Use Authorizations
KOL Refers to Key Opinion Leader
MVR Refers to Mechanical Vapor Recompression
QC Refers to Quality Control
Livzon Group Refers to Livzon Pharmaceutical Group Inc.* (丽珠医药集团股份有限公司)
Haibin Pharma Refers to Shenzhen Haibin Pharmaceutical Co., Ltd.* (深圳市海滨制药有限公司)
Xinxiang Haibin Refers to Xinxiang Haibin Pharmaceutical Co., Ltd.* (新乡海滨药业有限公司)
Taitai Pharmaceutical Refers to Shenzhen Taitai Pharmaceutical Co., Ltd.* (深圳太太药业有限公司)
Joincare Haibin Refers to Joincare Haibin Pharmaceutical Co., Ltd.* (健康元海滨药业有限公司)
Taitai Genomics Refers to Shenzhen Taitai Genomics Inc. Co., Ltd.* (深圳太太基因工程有限公司)
Jiaozuo Joincare Refers to Jiaozuo Joincare Bio Technological Co., Ltd.* (焦作健康元生物制品有限公司)
Joincare Daily-Use Refers to Joincare Daily-Use & Health Care Co., Ltd.* (健康元日用保健品有限公司)
Topsino Refers to Topsino Industries Limited* (天诚实业有限公司)
Fenglei Electric Power Refers to Shenzhen Fenglei Electric Power Investment Co., Ltd.* (深圳市风雷电力投资有
限公司)
6 Joincare Pharmaceutical Group Industry Co., Ltd.
Definitions of common terms
Health Pharmaceutical Refers to Health Pharmaceutical (China) Co., Ltd.* (健康药业(中国)有限公司)
Hiyeah Industry Refers to Shenzhen Hiyeah Industry Co., Ltd.* (深圳市喜悦实业有限公司)
Shanghai Frontier Refers to Shanghai Frontier Health Pharmaceutical Technology Co., Ltd.* (上海方予健康
医药科技有限公司)
Appraisal Institution Refers to Guangdong Taitai Forenstic Test Institute* (广东太太法医物证司法鉴定所)
Hong Kong Pharmaceutical Refers to Hong Kong Health Pharmaceutical Industry Company Limited* (香港健康药业
有限公司)
Health Investment Refers to Health Investment Holdings Ltd.
Joincare Special Medicine Refers to Joincare (Guangdong) Special Medicine Food Co., Ltd.* (健康元(广东)特医食品
Food 有限公司)
Livzon MAB Refers to Livzon MABPharm Inc.* (珠海市丽珠单抗生物技术有限公司)
Livzon Diagnostics Refers to Zhuhai Livzon Diagnostics Inc.* (珠海丽珠试剂股份有限公司)
Xinbeijiang Pharmaceutical Refers to Livzon Group Xinbeijiang Pharmaceutical Manufacturing Inc.* (丽珠集团新北江
制药股份有限公司)
Ningxia Pharmaceutical Refers to Livzon Group (Ningxia) Pharmaceutical Manufacturing Co., Ltd.* (丽珠集团(宁夏)
制药有限公司)
Gutian Fuxing Refers to Gutian Fuxing Pharmaceutical Co., Ltd.* (古田福兴医药有限公司)
Fuzhou Fuxing Refers to Livzon Group Fuzhou Fuxing Pharmaceutical Co., Ltd.* (丽珠集团福州福兴医药
有限公司)
Livzon Hecheng Refers to Zhuhai FTZ Livzon Hecheng Pharmaceutical Manufacturing Co., Ltd.* (珠海保税
区丽珠合成制药有限公司)
Livzon Limin Refers to Livzon Group Limin Pharmaceutical Manufacturing Factory* (丽珠集团利民制药
厂)
Livzon Pharmaceutical Refers to Livzon Group Livzon Pharmaceutical Factory* (丽珠集团丽珠制药厂)
Factory
Shanghai Livzon Refers to Shanghai Livzon Pharmaceutical Manufacturing Co., Ltd.* (上海丽珠制药有限公
司)
Sichuan Guangda Refers to Sichuan Guangda Pharmaceutical Manufacturing Co., Ltd.* (四川光大制药有限
公司)
Jiaozuo Hecheng Refers to Jiaozuo Livzon Hecheng Pharmaceutical Manufacturing Co., Ltd.* (焦作丽珠合
成制药有限公司)
Jinguan Electric Power Refers to Jiaozuo Jinguan Jiahua Electric Power Co., Ltd.* (焦作金冠嘉华电力有限公司)
Tianjin Tongrentang Refers to Tianjin Tongrentang Group Co., Ltd.* (天津同仁堂集团股份有限公司)
LivzonBio Refers to Zhuhai Livzon Biotechnology Co., Ltd.* (珠海市丽珠生物医药科技有限公司)
National COVID-19 Vaccine Refers to Working group for vaccine development under the State Council joint
Working Group prevention and control mechanism against COVID-19
COVID-19 Refers to A new coronavirus (SARS-CoV-2)
COVID-19 pandemic or Refers to The outbreak of the disease caused by a new coronavirus called SARS-CoV-2
pandemic
Ruihua Certified Public Refers to Ruihua Certified Public Accountants (Special General Partnership)
Accountants
Reporting Period Refers to From 1 January 2022 to 30 June 2022
End of the Reporting Period Refers to 30 June 2022
Currency or unit Refers to RMB unless otherwise specified
*For identification purpose only
Company
Profile and
Major Financial
Indicators 2
8 Joincare Pharmaceutical Group Industry Co., Ltd.
Chapter 2 Company Profile and Major Financial Indicators
I Company profile
Chinese name of the Company 健康元药业集团股份有限公司
Abbreviation of the Chinese name 健康元
English name of the Company Joincare Pharmaceutical Group Industry Co., Ltd.
Abbreviation of the English name Joincare
Legal representative of the Company Zhu Baoguo
II Contact persons and contact details
Board Secretary Representative of Securities Affairs
Name Zhao Fengguang (赵凤光) Li Hongtao(李洪涛), Luo Xiao(罗逍)
Address Joincare Pharmaceutical Group Building, No. 17, Joincare Pharmaceutical Group Building, No. 17,
Langshan Road, North District, Hi-tech Zone, Langshan Road, North District, Hi-tech Zone,
Nanshan District, Shenzhen Nanshan District, Shenzhen
Telephone 0755-86252656, 0755-86252388 0755-86252656, 0755-86252388
Fax 0755-86252165 0755-86252165
E-mail zhaofengguang@joincare.com lihongtao@joincare.com, luoxiao@joincare.com
III Introduction of the Company’s basic information
Registered address Joincare Pharmaceutical Group Building, No. 17, Langshan Road, North District, Hi-tech
Zone, Nanshan District, Shenzhen
Historical changes in Registered at B5, Hengfeng Industrial City, Hezhou Community, Huangtian Village, Xin’an
registered address Town, Bao’an County on 18 December 1992
Changed its registered address to 4-5/F, Dongpeng Building, Shangmeilin Industrial Area,
Futian District, Shenzhen on 25 May 1994
Changed its registered address to 24/F, Block B, Fujian Building, Caitian South Road, Futian
District, Shenzhen on 4 July 1995
Changed its registered address to 23/F, Diwang Building, Shun Hing Square, No. 333,
Shennan East Road, Shenzhen on 20 June 1997
Changed its registered address to Taitai Pharmaceutical Industrial Building, the 5th
Industrial Area, Nanshan District, Shenzhen on 22 September 2000
Changed its registered address to 23/F, Diwang Building, Shun Hing Square, No. 5002,
Shennan East Road, Luohu District, Shenzhen on 4 June 2003
Changed its registered address to Joincare Pharmaceutical Group Building, No. 17,
Langshan Road, North District, Hi-tech Zone, Nanshan District, Shenzhen on 29 January
2008
Changed its registered address to Joincare Pharmaceutical Group Building, No. 17,
Langshan Road, North District, Hi-tech Zone, Nanshan District, Shenzhen on 27 November
2012
Office address Joincare Pharmaceutical Group Building, No. 17, Langshan Road, North District, Hi-tech
Zone, Nanshan District, Shenzhen
Postal code of Office address 518057
Website http://www.joincare.com
E-mail joincare@joincare.com
Index for query of changes There was no change during the Reporting Period
during the Reporting Period
Interim Report 2022 9
IV Introduction of changes in information disclosure and places for inspection
Name of designated newspapers for information China Securities Journal, Securities Times, Securities Daily,
disclosure by the Company and Shanghai Securities News
Website for publication of the interim report http://www.sse.com.cn
Place for inspection of the interim report of the Company Office address of the Company
Index for query of changes during the Reporting Period There was no change during the Reporting Period
V Company stock profile
Class of stock Listed on Stock Abbreviation Stock code Stock abbreviation prior to change
A Share Shanghai Stock Exchange 健康元 600380 太太药业, S健康元
VI Other relevant information
□ Applicable√ N/A
VII Principal accounting data and financial indicators of the Company
(I) Principal accounting data
Unit: Yuan Currency: RMB
Increase/(decrease) for
the Reporting Period as
compared to the same
Principal accounting data Reporting Period Same Period Last Year period last year
(From January to June) (%)
Revenues 8,564,945,285.55 7,835,372,274.66 9.31
Net profit attributable to Shareholders of 801,268,519.50 687,347,494.53 16.57
the listed company
Net profit attributable to Shareholders of 803,994,432.03 597,892,327.43 34.47
the listed company after deducting the
extraordinary gain or loss
Net cash flow from operating activities 1,902,953,224.79 745,787,513.36 155.16
Increase/decrease
as at the end of the
Reporting Period as
End of the compared to the end of
Reporting Period End of the Last Year last year
(%)
Net assets attributable to Shareholders of 11,922,666,818.93 11,820,293,656.69 0.87
the listed company
Total assets 32,181,512,667.29 31,103,900,389.29 3.46
10 Joincare Pharmaceutical Group Industry Co., Ltd.
(II) Major Financial Indicators
Increase/decrease for
the Reporting Period as
compared to the same
Major Financial Indicators Reporting Period Same Period Last Year period last year
(From January to June) (%)
EPS (RMB/share) 0.4235 0.3514 20.52
EPS Diluted (RMB/share) 0.4232 0.3504 20.78
Basic earnings per share after deducting 0.4249 0.3057 38.99
the extraordinary gain or loss (RMB/share)
Weighted average return on net assets (%) 6.65 6.04 Increased by 0.61
percentage point
Weighted average return on net assets after 6.67 5.26 Increased by 1.41
deducting the extraordinary gain or loss (%) percentage points
Description of principal accounting data and financial indicators of the Company
√ Applicable □ N/A
At the end of the Reporting Period, the net profit attributable to Shareholders of the listed company after deducting the
extraordinary gain or loss was RMB804 million, representing a year-on-year increase of 34.47%, mainly due to the growth of
the sales revenues from the chemical pharmaceuticals and APIs products during the Reporting Period, which is the main
driver of the growth of the net incomes. The net cash flow from operating activities was RMB1, 903 million, representing
a year-on-year increase of 155.16%, mainly due to an increase of cash collections of sales revenues during the Reporting
Period.
VIII Differences in accounting data under domestic and foreign accounting standards
□ Applicable√ N/A
Interim Report 2022 11
IX Items and amounts of extraordinary gains and losses
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Items of Extraordinary Gains and Losses Amounts Notes (If applicable)
Gains and losses on disposal of non-current assets 3,731,885.55 Proceeds from disposal of fixed assets
Government grants as included in the profit or loss of 94,185,202.59 Government grants through profit and
current period (Note: Government grants that are closely loss for the Period
related to the normal business, in compliance with the
relevant policies and continuously entitled with specific
amount according to certain standards are not included)
Gains and losses on fair value changes derived from holding -98,936,528.71 Gains or losses arising from changes in
of financial assets held for trading, derivative financial assets, fair value of financial assets/liabilities
financial liabilities held for trading, derivative financial held for trading, and investment gains
liabilities, and investment income generated on disposal of from holding and disposal of financial
financial assets held for trading, derivative financial assets, assets/liabilities held for trading
financial liabilities held for trading, derivative financial
liabilities and other debt investments, except for effective
hedging activities related to the ordinary operating business
of the Company
Reversals of provision for impairment of accounts receivable 158,470.77 Reversal of accounts receivable tested
and contract assets with individual impairment test for impairment individually
Other non-operating Revenues and non-operating -2,270,691.97 Other non-operating Revenues and
expenditures apart from the above items non-operating expenditures apart from
the above items
Less: Effect of income tax 10,439,515.79 Effect of the above items on income tax
Effect of minority equity (after tax) -10,845,265.03 The portion of the above items to which
minority shareholders are entitled
Total -2,725,912.53
Explanations for classifying items of extraordinary gains and losses defined in the Explanatory Announcement No. 1 for
Public Company Information Disclosures – Extraordinary gains and losses as items of recurring profit or loss
□ Applicable√ N/A
X Others
□ Applicable√ N/A
3
Management
Discussion and
Analysis
Interim Report 2022 13
Chapter 3 Management Discussion and Analysis
I Description of the industry in which the Company operates and principal
businesses of the Company during the Reporting Period
(I) Principal businesses and products of the Company
The Company is primarily engaged in the R&D, production and sale of pharmaceutical products and health care products.
Pursuant to the Guidelines for the Industry Classification of Listed Companies (2012 Revision) issued by CSRC, the Company
operates in the pharmaceutical manufacturing industry (C27).
At present, the business scope of the Company covers chemical pharmaceuticals, traditional Chinese medicine, chemical
active pharmaceutical ingredients (APIs) and intermediates, diagnostic reagents and equipment, and health care products,
etc. The comprehensive products portfolio provides more market opportunities and greater room for development for the
Company. Below diagram sets forth the main products of the Company:
Chemical pharmaceuticals
Assisted
Respiratory reproduction Gastroenterology Anti-infection Psychiatry
Levosalbutamol Leuprorelin Acetate Ilaprazole Sodium for Meropenem for Injection Fluvoxamine Maleate
Hydrochloride Nebuliser Microspheres for Injection ( 壹丽安 ) ( 倍能 ) Tablets ( 瑞必乐 )
Solution ( 丽舒同 ) Injection ( 贝依 )
Ilaprazole Enteric- Voriconazole for Perospirone Hydrochloride
Budesonide Suspension Urofollitropin for Coated Tablets ( 壹 Injection ( 丽福康 ) Tablets ( 康尔汀 )
for Inhalation ( 雾舒 ) Injection ( 丽申宝 ) 丽安 )
Compound Ipratropium Recombinant Human Bismuth Potassium
Bromide Solution for Choriogonadotropin alfa Citrate Capsules ( 丽
Inhalation ( 舒坦琳 ) for Injection ( 丽得宝 ) 珠得乐 )
Ipratropium Bromide Bismuth Potassium
Solution for Inhalation Citrate Tablets/
( 丽雾安 ) Tinidazole Tablets/
Clarithromycin Tablets
( 丽珠维三联 )
Intelligent Mesh
Neblizer
Traditional Chinese Chemical APIs and Diagnostic reagents
medicine intermediates and equipment Health care products
Cold medicine Meropenem Trihydrate Diagnostic Kit for IgM / IgG Eagle’s American Ginseng
Anti-viral Granules D-7ACA Antibody to Coronavirus Tea
7-ACA (2019-nCoV) (Lateral Flow)
Anti-tumor medicine Milbemycin oxime Jingxin Menocare Essence
Autoimmunity multiple
Shenqi Fuzheng Injection Acarbose
detection platform
Mevastatin
Daptomycin
Phenylalanine
Vancomycin Hydrochloride
Imipenem and Cilastatin Sodium
14 Joincare Pharmaceutical Group Industry Co., Ltd.
(II) Business model of the Company
With the stable operation and rapid development over the years, the Company has become an integrated pharmaceutical
group which is driven by scientific research and innovation and integrates the R&D, production, sale and service of
pharmaceutical and health care products. It has complete systems of R&D, procurement, production and sale. Main
business functions of the Company are as follows:
1. R&D
Taking independent R&D as the mainstay and combining external introduction and cooperative development, the
Company has been emphasizing cutting-edge technology and unmet clinical needs. Focusing on innovative medicines
and high-barrier complex formulation, the Company has established an efficient R&D innovation management model. In
terms of independent innovation, the Company has diversified, multi-dimensional R&D organizations with mature R&D
teams for chemical pharmaceuticals, traditional Chinese medicine, biologics, APIs, diagnostic reagents and health care
products. Based on technology platform construction, the Company has built a clear product R&D pipeline centering
on key areas such as respiration, tumor immunity and psychiatry. In terms of cooperative innovation, the Company
has launched technical cooperation with domestic and foreign scientific research institutions by way of commissioned
development or cooperative development, and introduced new technologies and products that meet the strategical goal
of the Company through technology transfer or licensing to implement industrial transformation, so as to reinforce and
strengthen our position and strategy in leading fields and emerging fields.
2. Procurement
In terms of procurement, the Company pays close attention to effectiveness, quality and cost of procurement and has
established long-term and stable partnership with many suppliers. Active pharmaceutical ingredients, supplementary
materials, and packaging materials is purchased and stocked up by manufacturers according to production schedules.
The Company has developed strict quality standards and procurement management systems and required subordinate
manufacturers to make procurements in accordance with the GMP. Meanwhile, the Company established long-term
strategic partnerships with bulk material suppliers, and strengthened the management of supply quality and cost control
based on strict quality standards. The Company has established an internal evaluation system and files of market prices so
as to promptly master market information for procurement through comparisons of quality and price.
3. Production
In terms of production, the Company adopts the principle of market demand-oriented approach. Specifically, the Sales
Department of the Company investigated market demands, made sales plans, and comprehensively considered factors
such as the product inventory quantity and capacity of production lines of the Company so as to determine the monthly
production quantities and specifications. Moreover, the purchase orders of raw materials are determined according to the
production schedule and the inventory levels of raw materials. The final production plans are issued upon approval of the
management of the Company and implemented by the Production Technology Department of the Company.
The Company carried out production in strict compliance with the GMP. The Company and its affiliates have established
a sound quality management system and implemented the qualified person system. In terms of quality control, the
Company established a strict and sound production quality assurance system, and was geared to international standards
and subject to international certification while in compliance with national standards. The Company conducted annual
GMP self-inspection, ISO9001 internal and external audits, and was subject to various external audits. It actively pursued
the internationally advanced GMP management, and implemented whole-process quality control over supplier selection,
audit, incoming material inspection, production process, product release from factory, and market tracking with good
system operation.
Interim Report 2022 15
4. Sales
(1) Drug formulation products
End customers of drug formulation products (including Chemical pharmaceuticals, traditional Chinese medicine) of the
Company are mainly hospitals, clinics, and retail pharmacies. In line with the pharmaceutical industry practice and the
sales model of most peers in the industry, the Company has conducted sales of drug formulation products through drug
distribution enterprises. The Company carried out selection and centralized management of qualified drug distribution
enterprises (with Drug Supply Certificate, GSP Certification, etc.) according to their distribution capability, market
familiarity, financial strength, credit record, and operation scale. General sales process: After end customers place purchase
orders to distribution enterprises, drug distribution enterprises will send those orders to the Company according to their
inventories, distribution agreements and conditions; then, the Group will deliver products to drug distribution enterprises
and do the revenues recognitions.
(2) APIs and intermediates
Main target customers of APIs are large pharmaceutical manufacturers. The selling prices are determined based on a set of
comprehensive factors such as costs of production, inventory levels, industry rivalry and market conditions. The detailed
process of price determination are as follows: The sales and marketing department conduct weekly or bi-weekly meetings
to analyze the current market conditions and the trends and drivers of prices; the selling prices are determined based on a
set of comprehensive factors such as market trends, costs of production, inventory levels; the selling prices will be effective
once are reported by the sales department to our management team and get approvals.
Specific sales methods of APIs include: ① Domestic market: The Company directly signs product sales contracts with large
manufacturers to directly sell products to customers. Meanwhile, the Company also sells products through distributors. ②
Overseas market: The Company directly sells products in the overseas market and also sells products through distributors
in areas with high risks. At present, products of the Company are mainly exported to over 60 countries and regions in Asia,
Europe, North America, and Africa.
(3) Diagnostic reagents and equipment
Diagnostic reagents and equipment sold by the Company are both in-house manufactured and imported. Main end
customers are hospitals, centers for disease control and prevention, and health departments. The Company mainly sells
those products in combination with direct sales and sales through drug distribution enterprises.
The Company has an experienced sales team responsible for the sales of diagnostic reagents and equipment and
provision of marketing support for some drug distribution enterprises. The Company carried out selection and centralized
management of qualified drug distribution enterprises (with Drug Supply Certificate, GSP Certification, etc.) according to
their distribution capability, market familiarity, financial strength, credit record, and operation scale.
(4) Health care products
The sales model of health care products is mainly distributor management model. Product promotion, price control, and
channel carding are managed and improved with the distributor distribution channel and terminal coverage capability.
At present, the Company has set up 27 provincial branches and 92 subordinate offices across China and maintained
long-term partnership with distributors with better area coverage capability for stable strategic alliance and common
development. The Company has cooperated with about 103 primary distributors in total, including 78 businesses in drug
production line and around 25 businesses in food production line with over 150,000 subordinate secondary businesses
and terminal businesses in drug and food production lines. Products are well managed and promoted through the tiered
marketing channel. In addition to the traditional distribution management model, the Company realizes segment growth
through coordinated marketing in E-commerce channel.
16 Joincare Pharmaceutical Group Industry Co., Ltd.
(III) Analysis of industry development
As a national strategic and emerging industry which concerns national economy and the people’s livelihood,
pharmaceutical industry is an integral part of the national economy. According to the Development Plan of the
Pharmaceutical Industry during the “14th Five-Year Plan" Period , the overall development level of the pharmaceutical
industry is expected to reach a new level. During the “13th Five-Year Plan” period, the added value of the pharmaceutical
industry above designated scale increased by 9.5% annually, 4.2 percentage points higher than the overall industrial
growth rate, and its proportion in the whole industrial added value increased from 3.0% to 3.9%. The revenue and total
profits of enterprises above designated scale increased by 9.9% and 13.8% annually, ranking high among all industries.
At the same time, the scale of leading pharmaceutical manufacturing enterprises has further expanded, contributing to
the steady increase of the industrial concentration. In the first half of 2022, reforms in the pharmaceutical and health care
system have deepened further, the environment for innovation continues to improve, and the pharmaceutical industry
continues to make progress in the direction of further transformation and upgrading and high-quality development that
encourages innovation. As the aging population of our nation grows and the level of urbanization keeps on increasing, the
pharmaceutical industry of our nation, in the long run and as a whole, will show a continuous upward development trend.
Meanwhile, we should also pay attention to the severe challenges and universal impacts brought by the COVID-19
pandemic and the ever-mutating COVID-19 variants on national life and the production and operation of pharmaceutical
enterprises. In the first half of 2022, the domestic outbreak of COVID-19 occurred and spread repeatedly. Especially in some
areas, outbreak emergencies were declared and cases of successive variants reported. In the short term, the prevention
and control of domestic pandemic remains rigorous.
Data of National Bureau of Statistics shows that in the first half of 2022, enterprises in the pharmaceutical manufacturing
industry above designated scale in China have realized revenues of RMB1,400.78 billion, representing a year-on-year
decrease of 0.6%; operating costs of RMB815.96 billion, representing a year-on-year increase of 10.3%; total profits of
RMB220.95 billion, representing a year-on-year decrease of 27.6%.
(IV) Industry status of the Company
Through years of development, the Company has become an integrated pharmaceutical enterprise covering multiple
areas including chemical pharmaceuticals, chemical APIs and intermediates, traditional Chinese medicine, diagnostic
reagents and equipment as well as health care products. Chemical pharmaceuticals are the largest revenue generator of
the Company, among which drugs for alimentary tract medicine, anti-infective drugs and gonadorelin hormone drugs
are traditional competitive products of the Company, with key products securing a long-term position in national drug
formulation market segment, and respiratory and psychiatrical medicine have been the focus of the Company, with key
products maintaining a strong sales growth momentum.
During the Reporting Period, the Company, with solid strength in R&D and production and steady marketing presence,
ranked Top 9 in “2021 Annual Ranking of Top 100 Chinese Chemical Drug Enterprises” under “2021 Annual Ranking of Top
100 Enterprises in Pharmaceutical Industry in China” of menet.com.cn.
(V) Performance drivers in the Reporting Period
In the first half of 2022, the Company actively implemented sales planning, promoted marketing and reinforced sales
specialization amid domestic localized outbreaks and stricter industry supervision and access policies. In addition, the
Company increased digital marketing and enhanced delicacy management. That is how we can realize steady growth
of main business revenue and consolidate the foundation and ability of sustainable development of enterprises. During
the Reporting Period, sales of main varieties in key specialist areas, especially in fields of respiratory system, psychiatry,
gonadorelin hormone of the Company kept steady growth, and contribution of sales revenue of key formulation products
to overall revenues was continuously improved. In addition, the sales revenue of API segment grew noticeably with an
obvious increase of gross profit rate as the Company taken measures to integrate resources, adjust product mix, reinforce
international certification while actively using advanced technologies including synthetic biology and continuous
production to ensure green production.
Interim Report 2022 17
II Analysis of core competitive strengths during the Reporting Period
√ Applicable □ N/A
1. Leading PRC integrated pharmaceutical company under continuous innovation and development
The Company is primarily engaged in the R&D, production and sale of pharmaceutical products and health care products.
The business scope of the Company covers chemical pharmaceuticals, chemical APIs and intermediates, traditional
Chinese medicine, diagnostic reagents and equipment, as well as health care products, allowing the Company to establish
competitive advantages across various therapeutic areas such as respiratory, anti-infection, assisted reproduction,
gastroenterology, psychiatry, and tumor immunity. 1) Innovative R&D drives growth: The Company has developed and
launched a number of innovative medicine products and high-barrier complex formulation products, strengthening
the Group’s product portfolio and drug candidates in the pipeline. 2) The Company has first-tier commercialization
ability, and its sales network covers all provinces in China and over 80 overseas countries and regions in the world. The
Company emphasizes scientific promotion and evidence-based marketing. By building a professional marketing team,
the Company has established a comprehensive marketing system, and market education and brand building have been
deeply strengthened through digital marketing. Leveraging our comprehensive sales channels, broad market coverage,
leading digital marketing and brand awareness, the Company is able to sell the products at scale in an efficient manner.
3) Cross-industry and multi-specialist innovative R&D and coordinated development: On the one hand, the Company
actively adapts to the changes in the pharmaceutical market and constantly adjusts its product strategy and R&D direction
according to policies and clinical needs. This will realize the continuous iteration and upgrade of the main products;
On the other hand, the Company fully utilizes external scientific research and commercial resources, such as strategic
collaboration with Chinese Academy of Sciences, Tencent Quantum Lab and other scientific research institutes and
innovative companies, and invests in cutting-edge biotechnology companies to expand the Company’s product portfolio
and R&D pipeline and realize the Company’s sustainable development.
2. Strong R&D capabilities, diversified product portfolio and leading commercialisation capabilities
Focusing on innovative medicines and high-barrier complex formulation, the Company has formed diversified product
portfolio. With the huge clinical demand and high product quality, it has established market competitive advantages
in many pharmaceutical segments. The Company’s chemical pharmaceuticals cover gastroenterology diseases, assisted
reproduction, infectious diseases, respiratory diseases, psychiatric diseases, tumor and other disease treatment fields,
among which alimentary tract proton pump inhibitor (PPI) medicines, gonadorelin hormone drugs, and inhalation
formulation for respiratory diseases have an advantageous market position. Relying on APIs, the Company’s core products,
together with our chemical APIs and intermediates, form an integrated and stable pharmaceutical industry chain of
“APIs-integration drug formulations”. Meanwhile, the Company actively develops overseas markets, and our products are
marketed and distributed worldwide, facilitating strategic cooperation with many internationally renowned pharmaceutical
companies. In addition, the Company also has a number of traditional Chinese medicine and in vitro diagnostic reagent
products, and has accumulated resources and extensive brand influence in health care products for many years.
3. Making breakthroughs in the key R&D and industrialization technologies of Complex formulation
The technology platform, which has been developed over the years in the field of innovative medicines and high-barrier
complex formulation, enables the Company to address the complex process problems in the R&D and production
of relevant drugs. Guided by clinical value, the Company develops R&D projects with high short-term certainty and
cutting-edge technologies with long-term growth potential (such as AI-driven drug molecular design, proteolysis targeted
chimeric (PROTAC), synthetic biology, gene-editing and cellular treatment, etc.). All in all, the Company’s R&D system
covers through-cycle of drug development and production. Based on the mature R&D platform of innovative medicines
and high-barrier complex formulation, the Company has designed extensive pipeline in fields with significant clinical
demand such as respiration, gastroenterology, assisted reproduction, psychiatry and tumor.
18 Joincare Pharmaceutical Group Industry Co., Ltd.
4. Stable management and R&D team with expertise, long-term vision and commitment to social
responsibility
The Company has a stable, visionary and experienced, results-oriented management team and an outstanding talent team.
Outstanding leaders are the key to the Company’s rapid development. The founder of the Company has over 30 years of
expertise in the pharmaceutical industry as well as a global vision and a strategic mindset. With a deep industry insight, the
founder has led us developing platform technologies centered on high-barrier complex formulation, which has established
leading position of the Group with sustainable development in the broader healthcare industry. The senior management
team of the Company has over 20 years of industry experience on average, with an average of more than 10 years of service
in the Company, and has a thorough understanding of market demand, industry development and growth opportunities.
Each key R&D field of the Company is led by industry-leading scientists and accompanied by an efficient R&D management
team. In addition, the Company has upheld the core value of “Putting People First, Valuing Workmanship and Quality,
Pursuing Innovation and Truth, Promoting Cooperation and Sharing” and laid emphasis on talent team training to build
a diversified reserve of talents with global vision, advanced knowledge, strong implementation capability and sense of
self-reliance. Driven by the corporate culture of pursuing excellence, the talent team works diligently and conscientiously
to jointly contribute to the sustainable development of the enterprise through teamwork and collaboration.
III Discussion and analysis of business conditions
1. Main business conditions during the Reporting Period
During the Reporting Period, the Company realized revenues of RMB8,565 million, representing a year-on-year increase
of approximately 9.31%; a net profit attributable to shareholders of the listed company of RMB801 million, representing a
year-on-year increase of approximately 16.57%, and a net profit attributable to shareholders of the listed company after
deducting the extraordinary gains or loss of RMB804 million, representing a year-on-year increase of approximately 34.47%.
Business development of various segments of the Company is as follows:
(1) Livzon Group (excluding Livzon MAB)
As at the end of the Reporting Period, the Company directly and indirectly held 44.80% equity interest in Livzon Group
(000513.SZ, 01513.HK). During the Reporting Period, Livzon Group (excluding Livzon MAB) realized revenues of RMB6,296
million, and a net profit attributable to shareholders of the listed company of about RMB513 million. For the details of
business conditions of Livzon Group, please refer to the 2022 Interim Report of Livzon Group.
(2) Livzon MAB
As at the end of the Reporting Period, the Company held 55.92% equity interest in Livzon MAB and the amount affecting
the Company’s net profit attributable to the parent company for the current period was approximately RMB-140 million.
During the Reporting Period, Livzon MAB focused on promoting the application on conditional marketing approval of
the Recombinant SARS-CoV-2 Fusion Protein Vaccine (重组新型冠状病毒融合蛋白疫苗) (“V-01”) project. Livzon MAB has
completed the Phase III clinical master analysis report for sequential immunization and basic immunization, submitted
related application materials to CDE, and apply sequential EUA (Emergency Use Authorization) with National COVID-19
Vaccine Working Group. In terms of overseas registrations, Livzon MAB has submitted the EUA filings in the Philippines,
Indonesia and Malaysia, and has completed the submission of registration filings for the export of stock solution to
Pakistan; Livzon MAB actively communicated with WHO on the EUL (Emergency Use Listing) application for V-01. In
addition, in response to the global trend of COVID-19 pandemic and the prevalence of COVID-19 variants, Livzon MAB
developed several vaccines against the variants and related bivalent vaccines, and carried out animal and clinical trial
research related to enhanced immunization/sequential immunization.
Interim Report 2022 19
Meanwhile, Livzon MAB continued to focus on new molecules, new targets and differentiated molecular designs in the
fields of tumors, immune diseases and assisted reproduction. During the Reporting Period, Livzon MAB has made phased
progress in the R&D of the following projects: Recombinant Human Choriogonadotropin alfa for Injection (注射用重
组人绒促性素) was approved for marketing in 2021 and was already on sale, which is the first generic drug in China,
and Livzon MAB has been promoting overseas registrations and has submitted applications for overseas registration
in Uzbekistan, Tajikistan and Nigeria; the BLA application of Tocilizumab Solution for Injection (托珠单抗注射液) (i.e.
Recombinant Humanized Anti-human IL-6R Monoclonal Antibody Solution for Injection (重组人源化抗人IL-6R单克隆抗体
注射液) is under review by CDE, and it successfully passed the on-site verification of drug registration and the registration
inspection report has been received. In addition, Livzon MAB has been actively promoting the PQ (Pre-qualification) with
WHO. The phase Ib clinical interim analysis for psoriasis indication for Recombinant Anti-human IL-17A/F Humanized
Monoclonal Antibody for Injection (重组抗人IL-17A/F人源化单克隆抗体注射液) was completed, both high, medium and
low dose groups demonstrated good efficacy and safety; phase II clinical subjects were enrolled with efficacy and safety
under observation. In addition to advancing projects in the clinical phase, Livzon MAB is also exploring through R&D in
areas such as bispecific antibodies and cell therapy.
(3) Joincare (excluding Livzon Group and Livzon MAB)
During the Reporting Period, Joincare (excluding Livzon Group and Livzon MAB) realized revenues of RMB2,371 million,
up about 35.81% compared with the same period last year; and realized a net profit attributable to shareholders of listed
companies of RMB421 million, a year-on-year increase of approximately 45.25%. Joincare realized a net profit attributable
to shareholders of the listed company after deducting the extraordinary gains and losses of RMB414 million, representing a
year-on-year increase of approximately 56.39%. Key results of the main therapeutic fields and core products are as follows:
① Prescription medicines
During the Reporting Period, Joincare (excluding Livzon Group and Livzon MAB) realized sales revenues of RMB1,060
million from prescription drug segment, representing a year-on-year increase of approximately 67.76%. Among them, the
sales revenues and year-on-year change of key therapeutic areas are as follows: the revenue generated from the field of
respiratory totaled RMB561 million, representing a year-on-year increase of approximately 259%; the revenue generated
from the field of anti-infection totaled RMB488 million, representing a year-on-year increase of 4.75%.
In the first half of 2022, the Company continued to accelerate construction of the national sales team in respiratory line,
established a three-level fine marketing development system of regional manager, provincial manager, and development
manager, actively took various measures to speed up the development of key products in hospitals: 1. Enhanced the
coverage and fulfillment rate of evaluation indicators; the development speed of respiratory variety was obviously
accelerated; more than 1,400 hospitals above grade II were newly developed; 2. Realized rapid coverage and sales growth
of the variety by taking the opportunity that Levosalbutamol Hydrochloride Nebuliser Solution (盐酸左沙丁胺醇雾化吸
入溶液) was included in the list of drugs for negotiation led by National Healthcare Security Administration; 3. Continued
to advance the construction of digital marketing platforms, accelerated the marketing process through digital means and
comprehensively communicated the brand via the platform of “Talk from A Respiratory Specialist” (呼吸专家说); 4. With
three inhalation formulation being successfully included to the fifth batch of the volume-based procurement organised
by the PRC Government, the Company has rapidly tapped into the domestic sales market and improved market share for
inhalation formulation products.
During the Reporting Period, R&D of inhalation formulations of the Company went well. The following products made
phased progress: Levosalbutamol Hydrochloride Nebuliser Solution (盐酸左沙丁胺醇雾化吸入溶液) (3mL: 1.25mg);
Terbutaline Sulphate Solution for Nebulization (硫酸特布他林雾化吸入用溶液) has been approved for marketing;
Tobramycin Inhalation Solution (妥布霉素吸入溶液) (class 2.4) was successfully completed additional research, the
product is under review and pending for approval; Fluticasone Propionate Suspension for Inhalation (丙酸氟替卡松雾
化吸入用混悬液) has completed the application for market approval; Salmeterol Xinafoate and Fluticasone Propionate
Powder for Inhalation (沙美特罗替卡松吸入粉雾剂) has received the notice of clinical trials and rapidly initiated phase
III clinical trials; Indacaterol Maleate Powder for Inhalation (马来酸茚达特罗吸入粉雾剂) expedited its PD-BE study.
Meanwhile, the Company acquired rights of XYP-001 in the Greater China, an innovative inhalation formulation with
independent intellectual property rights, through license-in, further enriching the Company’s inhalation formulation
pipeline. The Company submitted for the first time an application for registration of a medical device to accompany the
inhalation product, achieving a new breakthrough in the medical device field and forming a synergy with the inhalation
formulation to strengthen the Company’s core competitiveness in the field of respiratory diseases. Class 2 new drug XYP-
001 has completed preclinical study.
20 Joincare Pharmaceutical Group Industry Co., Ltd.
② APIs and intermediates
During the Reporting Period, Joincare (excluding Livzon Group and Livzon MAB) realized sales income of RMB1,150 million
from APIs and intermediates, representing a year-on-year increase of approximately 21.80%.
During the Reporting Period, in the API segment, Joincare continued to strengthen safety and environmental protection
construction and drive lean production. Production and yield of key products were improved through further
enhancement of technical innovation of production process. Production costs were stable with a slight decline against
the backdrop of continued rise of bulk commodities prices and increased pressure from procurement cost of raw materials
in the first half of 2022. In terms of marketing, Joincare actively expanded domestic and international markets for the
key product 7-ACA by optimising strategic cooperation channels and strengthening in-depth cooperation with strategic
customers. Leveraging the advantages in the upstream and downstream industry chains, we continued to increase
our market share. The export share of Meropenem Trihydrate (美罗培南混粉) has repeatedly set a new high. Despite
increased competition in the market this year, the Company continued to strengthen its position in the market through
making plans in advance, and the sales of Meropenem Trihydrate remained steady growth based on a higher base in the
same period of previous year. In addition, the Company actively expanded overseas business, applying the registration for
Meropenem Trihydrate and Meropenem Crude (美罗培南粗品) in Japanese market and Italy market, respectively.
In terms of API R&D, the Company focuses on two frontier fields to carry out key scientific research. Firstly, conducting
research on genetic component design, functional genome mining, synthetic pathway analysis, metabolic network
optimization, gene circuit reconstruction and systems metabolic engineering of industry host microorganism by
using gene editing, synthetic biology, systems biology, protein directed evolution, high-throughput screening and
other technology platforms. The Company has obtained more than 520 potential cephalosporin C (头孢菌素 C, CPC)
high-yielding mutant strains from over 38,000 acremonium chrysogenum (产黄支顶孢霉) strains in the initial screening,
and has conducted small trials, pilot fermentation and scale-up verification in production, which made the average CPC
yield per unit increased steadily. Secondly, the Company fueled innovation in small and large molecule drug-related
expression component splicing, molecular structure simulation, synthetic route design, structure and function prediction
and heterologous expression of high-value medicinal products by combining machine learning, bioinformatics, customized
design in genome scale and other technological tools. The collaborative project with Tencent Quantum Lab made good
progress. We have jointly developed deep learning-based algorithm architecture for predicting potential biosynthetic gene
clusters (BGCs) and have jointly applied for one national invention patent.
③ Health care products and OTC
During the Reporting Period, Joincare (excluding Livzon Group and Livzon MAB) realized revenues of RMB151 million from
health care products and OTC segment, representing a year-on-year decrease of approximately 5.79%.
In the first half of 2022, despite that the offline channels were affected by external factors including the resurgence
of COVID-19 pandemic and national health insurance policies, the Company’s health care products and OTC segment
remained a solid performance through continuous brand building with online channels. During the Reporting Period, our
health care products and OTC segment built brand reputation with a user-centric approach and consolidated positioning
of each brand in sub-segments. Additionally, the segment further explored the channel strategy that integrates online
and offline channels and leads to a coordinated development. For brand marketing, through in-depth cooperation
with professional KOLs, the Company delivered scientific knowledge and concepts on health care in the form of live
broadcasts and short videos, thus building our brand image and reputation as a professional health care enterprise. During
the Reporting Period, with focus on our key brands, we have built a content platform, on which we spread scientific
knowledge to promote interaction among our brand, consumers and professional KOLs, thereby increasing brand
exposure and sales conversions.
Interim Report 2022 21
2. Business plans in the second half of 2022
In the second half of 2022, the major tasks in various business segments of the Company are set out as follows:
(1) R&D Center
In terms of innovative R&D, the Company will continue to improve its target management and appraisal mechanism to
increase R&D efficiency, ensure the R&D progress of core products to rapidly drive product transformation, especially with
a focus on promoting the launch application of tobramycin inhalation solution and Recombinant SARS-CoV-2 Fusion
Protein Vaccine (V-01). Meanwhile, we will increase innovation effort to improve R&D innovation efficiency through
actively using digital and intelligent new technology and model. The Company will actively develop micro and nano
injectables, long-acting formulation, liposomes and other high-barrier complex formulation platforms while continuing
to promote the original technology platform with edges through various means including independent development,
external introduction and collaborative development. Meanwhile, the Company will integrate its resources and fully utilize
the edges of its own APIs advantages to couple with the R&D of drug formulation products with the aim of forming an
integrated industrial chain. In addition, the Company will continue to strengthen internal and external training and the
introduction of senior R&D personnel to promote the overall R&D capacity of the team and enhance the comprehensive
R&D strength of the enterprise.
(2) Production Center
The Company will ensure workplace safety and product quality by constant improving quality management system and
implementing product quality-centered risk control. While emphasizing checking raw and auxiliary materials, production
sites and production process according to these six systems in GMP to identify workplace safety risks, the Company
will continuously optimize the production process by introducing green synthetic technology and synthetic biology
technology, and develop the employee training system for improving their professional skills to further ensure product
stability and quality. The Company will keep reducing costs and improving efficiency through introducing advanced
technology and equipment, production optimization, system improvement and lean management, to effectively improve
the production and operation. The Company will adhere to green development, uphold and promote the concept of
green, healthy and sustainable development. To effectively implement energy conservation, emission reduction and
green production, the Company will enhance the environmental protection and quality standards and requirements,
set environmental protection targets, and strengthen monitoring of energy consumption, pollutant emissions and other
environmental information in the production and operation. The Company will also keep optimizing production capacity,
advance the construction of Pingshan Haibin Factory and the new production line as planned, follow up the establishment
of supporting facilities and capacity planning, and improve the technology transformation capacity of new products to
meet the increased market demand for new and existing products.
(3) Sales Center
The key work deployments in marketing of prescription drugs are as follows: 1. Strengthen team building and improve
comprehensive quality through expanding the terminal sales team, attracting excellent talents to join the sales team,
making brand building a goal, and enhancing the practical capability and comprehensive quality of marketing teams
nationwide; 2. Continue to strengthen integration of terminal resources, focus on establishing national benchmark
areas, benchmark hospitals and benchmark sales teams, include key hospitals above grade II in appraisal system, and
comprehensively enhance the coverage and fulfillment rate of evaluation indicators; 3. Make continuous efforts in
business, production, terminal and other links and quickly increase market share and raise brand awareness in all aspects;
4. Continue to advance construction of digital marketing platform and support for terminal market activities, effectively
combine online and offline methods, and enhance in-depth brand recognition on the doctor side and patient side; 5.
Follow up in real time national medical reform-related policies, strengthen clinical and pharmaco-economic research of
products after marketing, and actively respond to medical insurance policy adjustment and volume-based procurement.
As Meropenem for injection being included in the national list for the seventh batch of volume-based procurement, the
Company will leverage the strength in integrating APIs drug formulation to expedite the development of and expand
market for other products.
22 Joincare Pharmaceutical Group Industry Co., Ltd.
In terms of marketing and promotion of APIs and intermediates, the Company will further strengthen construction of sales
team, make full use of OKR and strengthen management by objectives, to build a vigorous and highly efficient sales team;
continue to promote strategic cooperation, pursue further development in segments, actively develop customer resources,
maintain partnership, give full play to the strength of the company brand, and establish a long-term, stable and win-win
cooperation model with strategic partners. Moreover, the Company will build good brand reputation in global market
through close cooperation with world-class enterprises. In addition, the Company will pay close attention to changes in
exchange rate and market conditions and promptly adjust sales strategies.
In the second half of the year, the Company will constantly consolidate the advantages of the offline channels in health
care products and OTC segment, and improve the word-of-mouth marketing of the brands at the same time. For the
brand building, the Company will further promote specialized content and brand value to enhance customers’ awareness
of our brands and continuously strengthen the core competiveness of the brands. Besides, the Company will also push
forward new product launches and iterations of core brands such as “Taita” leveraging the Company’s edges in R&D,
manufacturing and marketing integration industry chain. For the marketing system construction, the Company will
upgrade the “online + offline” synergistic and coordinated marketing model. We will highlight the refined operation of new
media and mainstream e-commerce platforms while paying continued efforts to reform the offline team structure, deepen
the distribution channel, integrate the key and chain stores, and empower the Company with resources. The Company
will continue to improve online self-operated channels such as platforms of WeChat Mall, TikTok e-commerce, Tmall and
Jingdong(JD). In addition, the Company will increase investment in the refined operation throughout the entire customer
lifecycle to enhance its data-based marketing capabilities and achieve accurate access of target users. In doing so, the
Company will be able to establish a marketing-closed loop covering targeted penetration, accessing, attracting new users,
repurchase and in-depth operation.
(4) Functions and strategies
The key function works of the Company are as follows: Firstly, we will continue to improve the organizational structure
and institutions in subsidiaries of the Group to increase the management efficiency and fully advance lean management.
Secondly, we will continue to strengthen talent and policy construction, implement the management by objective (MBO)
system with OKRs and KPIs in tandem, conduct quarterly rolling dynamic tracking and adjustment under close cooperation
and full support of every department so as to provide powerful service and support for R&D, production and sales. Thirdly,
we will continue to drive corporate cultural construction, increase efforts to communicate corporate culture and put them
into practices in the Group and its subsidiaries to strengthen the cohesion. Fourthly, we actively give full play to resource
advantages of internal and external business cooperation, make investment strategies, and introduce innovative products
and technologies to improve strategic planning of the Company. Fifthly, we actively fulfill corporate social responsibility,
endeavor to improve corporate governance level, and promote high-quality and sustainable development.
Material changes in business conditions of the Company during the Reporting Period and matters occurred during the
Reporting Period that had and are expected to have significant impacts on business conditions of the Company
□ Applicable√ N/A
Interim Report 2022 23
IV Overview of business operations during the Reporting Period
(I) Analysis of principal businesses
1 Table for analysis of changes in items related to financial statements
Unit: Yuan Currency: RMB
Amount in the current Amount in the same
Item period period of last year Change
(%)
Revenues 8,564,945,285.55 7,835,372,274.66 9.31
Operating costs 3,054,392,703.20 2,743,005,734.93 11.35
Selling expenses 2,512,369,792.45 2,499,949,757.30 0.50
Administrative expenses 529,828,311.93 397,921,091.17 33.15
Financial expenses -130,401,047.67 -41,726,762.77 N/A
R&D expenses 707,433,078.44 622,962,388.41 13.56
Net cash flow from operating activities 1,902,953,224.79 745,787,513.36 155.16
Net cash flow from investing activities -433,259,385.19 -1,173,747,818.24 N/A
Net cash flow from financing activities -656,811,058.44 -1,475,233,697.43 N/A
Reasons for changes in administrative expenses: Mainly due to the provision of incentive fund under Medium to Long-term
Partner Share Ownership Scheme for the current period and the provision of appraisal bonuses.
Reasons for changes in financial expenses: Mainly due to the increase in interest income for the current period as
compared to the previous period.
Reasons for changes in net cash flow from operating activities: Mainly due to the increase in payment collection during
the current period.
Reasons for changes in net cash flow from investing activities: Mainly due to the payment of the consideration for the
equity of Tianjin Tongrentang Group Co., Ltd. (天津同仁堂集团股份有限公司) in the previous period.
Reasons for changes in net cash flow from financing activities: Mainly due to new and additional long-term borrowings
during the current period.
2 Details of material changes in business type, components or source of profits during the current period
□ Applicable√ N/A
24 Joincare Pharmaceutical Group Industry Co., Ltd.
3 Analysis of revenues and costs
Principal businesses by industry, product and region
Unit: Yuan Currency: RMB
Principal business by industry
Gross YoY change YoY change
profit YoY change in operating in gross profit
By industry Revenues Operating costs margin in revenues costs margin
(%) (%) (%) (%)
Industry and commerce 8,486,018,063.45 3,000,716,833.69 64.64 9.09 11.07 Decreased by 0.63
percentage point
Service industry 6,029,696.27 2,232,496.69 62.97 40.68 91.66 Decreased by 9.85
percentage point
Principal business by products
Gross YoY change YoY change
profit YoY change in operating in gross profit
By products Revenues Operating costs margin in revenues costs margin
(%) (%) (%) (%)
Chemical pharmaceuticals 4,799,253,426.28 925,086,073.19 80.72 8.23 10.05 Decreased by 0.32
percentage points
Chemical APIs and 2,771,577,889.05 1,743,742,075.65 37.08 22.70 14.88 Increased by 4.28
intermediates percentage points
Traditional Chinese medicine 514,402,423.73 146,937,126.69 71.44 -18.74 -12.99 Decreased by 1.89
percentage points
Diagnostic reagents and 346,042,443.87 164,056,563.15 52.59 -11.43 4.54 Decreased by 7.24
equipment percentage points
Health care products 54,741,880.51 20,894,995.01 61.83 -12.30 20.77 Decreased by 10.45
percentage points
Principal business by region
Gross YoY change YoY change
profit YoY change in operating in gross profit
By region Revenues Operating costs margin in revenues costs margin
(%) (%) (%) (%)
Domestic 6,974,358,565.54 2,065,054,349.09 70.39 6.96 12.22 Decreased by 1.39
percentage points
Overseas 1,517,689,194.18 937,894,981.29 38.20 20.17 8.74 Increased by 6.50
percentage points
Description of principal businesses by industry, product and region
During the Reporting Period, the Company’s principal businesses generated revenues of RMB8,492 million, representing
a year-on-year increase of RMB709 million or 9.10%. Chemical pharmaceuticals achieved revenue of RMB4.799 billion,
representing an increase of 8.23% year-on-year. Among them, the sales revenue in the field of gastroenterology reached
RMB1.781 billion, dropping by 8.16% year-on-year; the sales revenue in the field of gonadorelin hormones amounted to
RMB1.344 billion, increasing by 6.82% year-on-year; the sales revenue in the field of anti-infection was RMB683 million,
increasing by 3.28% year-on-year; the sales revenue in the field of respiratory reached RMB561 million, a year-on-year
increase of 259%; the sales revenue of psychiatry products was RMB264 million, a year-on-year increase of 36.26%.
Chemical APIs and intermediates recorded revenue of RMB2.772 billion, a year-on-year increase of 22.70%.
The growth of the Company’s revenues of principal businesses was primarily due to the Company’s continuous efforts in
promoting marketing reforms, fully facilitating the mass market product channels and accelerating sales in the key area
of Chemical pharmaceuticals. In addition, the sales revenue of API segment grew noticeably with an obvious increase of
gross profit rate as the Company taken measures to integrate resources, adjust product portfolio, reinforce international
certification while actively using advanced technologies including synthetic biology and continuous production to ensure
green production.
Interim Report 2022 25
4. Investment in R&D
(1) Table for investment in R&D
Unit: Yuan Currency: RMB
Expensed investment in R&D during the Period 707,433,078.44
Capitalized investment in R&D during the Period 97,081,498.87
Total investment in R&D 804,514,577.31
Total amount of investment in R&D as a percentage of revenues (%) 9.39
(2) Description
During the Reporting Period, total investment in R&D of the Company amounted to RMB804.5146 million, representing
a year-on-year growth of 15.39%, accounting for 9.39% of total revenues. During the Reporting Period, the Company’s
investment in R&D was mainly used for R&D of new products and upgrading and reconstruction of project technology. As
biologics, inhalation formulations and other projects entered the clinical stage, investment in R&D increased as compared
with the same period of last year.
During the Reporting Period, the general R&D efforts of the Company in different segments were as follows:
(1) Chemical pharmaceuticals
① High-barrier complex formulation: There were a total of 43 projects under research, of which, 2 had been launched to
the market, 2 had been applied for production, 6 were under the clinical/BE study and 3 had been applied for clinical
trials. The progress of the major projects was as follows:
Inhalation formulations: Levosalbutamol Hydrochloride Nebuliser Solution (盐酸左沙丁胺醇雾化吸入溶液)
(3ml:1.25mg) and Terbutaline Sulfate Nebuliser Solution (硫酸特布他林雾化吸入用溶液) had been launched for
market; Tobramycin Inhalation Solution (妥布霉素吸入溶液) (class 2.4) was successfully completed additional
research, the product is pending for review and approval; Fluticasone Propionate Inhalation Suspension (丙酸氟替卡
松雾化吸入用混悬液) had been applied for marketing authorization; Salmeterol Xinafoate and Fluticasone Propionate
Powder for Inhalation (沙美特罗替卡松吸入粉雾剂) had received the notice of clinical trials and started the phase III
clinical study immediately; Indacaterol Maleate Powder for Inhalation (马来酸茚达特罗吸入粉雾剂) had started PD-BE
study; Formoterol Fumarate Inhalation Aerosol (富马酸福莫特罗吸入气雾剂) had started phase I clinical research.
Class 2 new drug XYP-001 has completed preclinical study.
Sustained-release microspheres: Triptorelin Acetate Microspheres for Injection (注射用醋酸曲普瑞林微球) (1-month
sustained release) had been applied for marketing authorization and completed the on-site verification of research
and production; Aripiprazole Microspheres for Injection (注射用阿立哌唑微球) (1-month sustained release) was
undergoing phase I multiple-dose clinical trials; Octreotide Acetate Microspheres for Injection (注射用醋酸奥曲肽
微球) (1-month sustained release) and Leuprorelin Acetate Microspheres for Injection (注射用醋酸亮丙瑞林微球)
(3-month sustained release) had carried out the BE pre-trial; Triptorelin Pamoate Microspheres for Injection (注射用双
羟萘酸曲普瑞林微球) prepared to commence phase I clinical trials; Alarelin Microspheres for Injection (注射用丙氨
瑞林微球) (1-month sustained release) had completed process scale-up research and was undergoing ethical review
for phase I clinical trials; Goserelin Acetate Sustained-release Implant (醋酸戈舍瑞林缓释植入剂) had carried out the
bridging study of pilot-scale production.
② Conventional formulations: There were a total of 41 projects under research, 5 projects had applied for production and
4 projects were under the clinical/BE study. Among others, Cetrorelix Acetate for Injection (注射用醋酸西曲瑞克) had
been submitted a response to the deficiency letter for registration application in the United States; Blonanserin Tablets
(布南色林片) and Lurasidone Hydrochloride Tablets (盐酸鲁拉西酮片) had been applied for marketing authorization;
new indications of Ilaprazole Sodium for injection (注射用艾普拉唑钠) had completed phase III clinical trials and
submitted application materials; LZ001, an innovative anti-tumor drug, had received the notice of clinical trials and
was undergoing phase I clinical trial; Semaglutide Injection (司美格鲁肽注射液) and Progesterone Injection (黄体酮
注射液) had been submitted clinical trial application, which was accepted by CDE and is under review.
26 Joincare Pharmaceutical Group Industry Co., Ltd.
③ Consistency evaluation: There were a total of 17 projects under research. Imipenem and Cilastatin Sodium for Injection
(注射用亚胺培南西司他丁钠) and Cefodizime Sodium for Injection (注射用头孢地嗪钠) had been submitted relevant
materials and were under review; the professional review of Bismuth Potassium Citrate Capsule (枸橼酸铋钾胶囊) had
been completed and the review conclusion was pending; Rabeprazole Sodium Enteric-Coated Tablets (雷贝拉唑钠肠
溶片) was undergoing BE trials.
(2) Biologics
There were a total of 7 projects under research, of which 1 project had been marketed, 1 project had applied for
conditional market launch, 1 project had applied for BLA, 2 projects were in the phase Ib/II clinical trials and 2 projects
were in the phase I clinical trial.
Recombinant Human Choriogonadotropin alfa for Injection (注射用重组人绒促性素) was approved for launching in
the market in China in 2021, and the work related to overseas registration is being promoted; Recombinant SARS-CoV-2
Fusion Protein Vaccine(V-01) (重组新型冠状病毒融合蛋白疫苗(V-01)) had been applied for sequential emergency
use to the National COVID-19 Vaccine Working Group (国家疫苗专班), and a conditional market launch application
had been submitted to the National Medical Products Administration (国家药品监督管理局), which were both under
review; the BLA of Tocilizumab Solution for Injection (托珠单抗注射液) had been accepted by CDE and was under CDE
review; Recombinant Humanized Anti-PD-1 Monoclonal Antibody for Injection (注射用重组人源化抗PD-1单克隆抗
体) and Recombinant Anti-human IL-17A/F Humanized Monoclonal Antibody for Injection (重组抗人IL-17A/F人源化单
克隆抗体注射液) were undergoing phase Ib/II clinical trials; and Recombinant Tumor Enzyme Specific Interferon α-2b
Fc Fusion Protein for Injection (注射用重组肿瘤酶特异性干扰素α-2b Fc融合蛋白) and Recombinant Human Follicle
Stimulating Hormone for Injection (重组人促卵泡激素注射液) were undergoing phase I clinical trials.
(3) APIs and intermediates
There were a total of 35 projects under research, of which 19 were New Product R&D Projects and 16 were
Tech-transformation Projects of Existing Products. For New Product R&D Projects, the API of Fluticasone Furoate (糠酸
氟替卡松) had been approved for launching in the market, and the registration application for the API of Caspofungin
Acetate (醋酸卡泊芬净) had been submitted. For Technological Upgrading Projects of Existing Products, the key
project Cephalosporin C-High Producing Strains (头孢菌素C高产菌株) was progressing smoothly. After screening, the
strains had been completed the scale production verification, and the average unit yield had been steadily increased;
based on the development and selection of new L-phenylalanine – High Producing Strains (L-苯丙氨酸新型高产
菌株) driven by IBT technology, a standard molecular genetics element database had been established and strain
modification and selection was proceeding.
(4) Traditional Chinese Medicine (TCM)
There were 8 projects under research for new TCM, of which, SXSHL gel, an new improved traditional Chinese
medicine, had completed pre-clinical trial experiment research, and its application materials were being prepared
and collected. Exploratory clinical trial had been completed for TGDX Granules, a class 1.1 new traditional Chinese
medicine, and it were being statistically analyzed.
(5) Diagnostic reagents and equipment
There were 98 projects under research, of which, 12 were in the clinical trial stage (including the projects under
review). For reagent development platform, Two products, namely, Antigen Detection Kit for SARS-CoV-2 (2019-nCOV)
(Latex Method) (新型冠状病毒(2019-nCoV)抗原检测试剂盒(乳胶法)) and Assay Kit for Immunoglobulin G4
(Chemiluminescence Method) (免疫球蛋白G4测定试剂盒(化学发光法)(IgG4)) had obtained the domestic registration
certificate. 12 projects including Rapid Test for Influenza A/B Antigen (Lateral Flow) (甲型乙型流感抗原检测试剂盒(胶
体金法)), Diagnostic Kit for Chlamydia Pneumoniae IgM Antibody (Fluorescence Immunochromatography) (肺炎衣原
体IgM抗体检测试剂(荧光免疫层析法)), Passive Particle Agglutination Test for Detection of Antibodies to Treponema
Pallidum (梅毒螺旋体抗体检测试剂盒(凝集法)), Diagnostic Kit for Measurement of Antibodies to Mycoplasma
Pneumonia (Passive Particle Agglutination) (肺炎支原体抗体检测试剂盒(被动凝集法)) had started clinical trials. 9
projects including Diagnostic Kit for IgM Antibody to Mycoplasma Pneumonia (Chemiluminescence Immunoassay) (肺
炎支原体抗体检测试剂盒(化学发光法)), Livzon Interferon-Gamma Release Assays (IGRA) Test Kit (Chemiluminescence
Immunoassay) (结核感染 T 细胞测定试剂盒(化学发光法)), Three Tests of ABO Blood Types (Percolation Method) (ABO
血型三项(渗滤法)), and Four Tests of Diabetes were in the registration application stage, of which, Three tests of ABO
Blood Types (filtration assay) (ABO 血型三项(渗滤法)) and Diagnostic Kit for IgM Antibody to Mycoplasma Pneumonia
(Chemiluminescence Immunoassay) (肺炎支原体抗体IgM检测试剂盒(化学发光法)) were in the process of submitting
supplementary materials for registration. Another batch of projects was under R&D. In regard to the equipment R&D
platform, second-generation model of irradiator (辐照仪) had completed the registration inspection and entered the
stage of registration submission. The Molecular all-in-one Machine (分子一体机) and Molecular POCT project (分子
POCT 项目) had entered the stage of the prototype trial production.
Interim Report 2022 27
(II) Description of material changes in profits arising from non-principal businesses
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Proportion of Sustainable
Item Amount total profits Cause or not
Investment income 51,014,159.00 2.81% Primarily due to changes in gains or No
losses of the associates in which the
investments are made and gains from
the settlement of forward settlement
contracts upon maturity.
Gains or losses from -95,479,537.15 -5.26% Primarily due to fluctuations in market No
changes in fair value value of the securities investment held.
Impairment of assets -27,834,495.93 -1.53% Primarily due to the impairment No
provision for inventories.
Non-operating income 4,470,914.88 0.25% It is primarily income from waste No
disposal, etc.
Non-operating expenses 6,741,606.85 0.37% It is primarily donation expenses and No
loss on retirement of fixed assets.
Other gains 97,242,254.03 5.35% It is primarily government subsidies Yes
received.
(III) Analysis of assets and liabilities
√ Applicable □ N/A
1. Analysis of assets and liabilities
Unit: Yuan
Change in the
Ending amount Ending amount ending amount
Ending amount of the period to Ending amount of last year to of the period to
Item of the period the total assets of last year the total assets that of last year Cause
(%) (%) (%)
Financial assets held 99,806,543.32 0.31 184,638,344.31 0.59 -45.94 Primarily due to fluctuations in
for trading market value of the securities
investment held.
Other receivables 50,888,736.71 0.16 88,053,825.12 0.28 -42.21 Primarily due to the receipt of
Yunfeng’s payment during the
current period.
Non-current assets 38,498.84 0.00 317,381.23 0.00 -87.87 Primarily due to the recovery of
due within one year finance lease payments.
Other current assets 51,971,077.28 0.16 83,986,214.37 0.27 -38.12 Primarily due to the decrease in
the amount of VAT credits as a
result of the refund thereof.
Long-term 82,574.69 0.00 266,904.13 0.00 -69.06 Primarily due to the recovery of
receivables finance lease payments.
Construction in 1,138,204,863.10 3.54 742,998,743.75 2.39 53.19 Mainly due to the increase in
progress investment for construction of
new plants and workshops of
subsidiaries.
28 Joincare Pharmaceutical Group Industry Co., Ltd.
Change in the
Ending amount Ending amount ending amount
Ending amount of the period to Ending amount of last year to of the period to
Item of the period the total assets of last year the total assets that of last year Cause
(%) (%) (%)
Financial liabilities 10,791,038.40 0.03 143,302.24 0.00 7,430.26 Primarily due to fluctuations in
held for trading foreign exchange forward.
Contract liabilities 100,704,258.24 0.31 234,140,702.29 0.75 -56.99 Primarily due to some contract
performance
obligations during the the
current period, which satisfies
the conditions for revenue
recognition and results in the
carrying forward of revenue.
Taxes payable 420,134,507.00 1.31 270,618,183.41 0.87 55.25 Primarily due to the increase in
corporate income tax payable
and individual income tax
payable withheld from the
dividend distribution.
Other current 7,166,683.80 0.02 15,626,224.29 0.05 -54.14 Primarily due to the decrease
liabilities in pending output tax as the
contract payment collected in
advance in the current period
meets the revenue recognition
conditions and is carried
forward.
Long-term 2,403,726,004.58 7.47 826,780,252.78 2.66 190.73 Primarily due to the adjustment
borrowings from short-term borrowings
to long-term borrowings of
subsidiaries after debt structure
adjustment during the the
current period.
Treasury shares 742,977,205.72 2.31 222,644,454.50 0.72 233.71 Primarily due to share
repurchases during the current
period.
Other -37,611,311.23 -0.12 5,387,545.97 0.02 -798.12 Primarily due to the changes
comprehensive in other comprehensive gains
incomes during the current period as a
result of the disposal of Galaxy
Securities.
2. Overseas assets
√ Applicable □ N/A
(1) Asset size
Among them: Overseas assets were 41.35 (Unit: 100 million Currency: RMB), representing 12.85% of the total assets.
(2) Statement on high proportion of overseas assets
□ Applicable√ N/A
Interim Report 2022 29
3. Restrictions on assets entitlements as at the end of the Reporting Period
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Carrying value at the
Item end of the period Cause for restriction
Other monetary funds 1,151,193.00 Letters of credit, bank acceptances and forward exchange settlement
deposits, etc.
Notes receivable 526,815,981.78 Notes pool business and pledge of notes receivable
Total 527,967,174.78
4. Others
□ Applicable√ N/A
(IV) Analysis of investment
Overall analysis of external equity investments
√ Applicable □ N/A
During the Reporting Period, the Company carried out strategic investments according to development plans and
schedules as follows:
1. Major equity investments
√ Applicable □N/A
(1) The capital injection to Jiangsu Atom Bioscience and Pharmaceutical Co., Ltd.
On 31 December 2021, Zhuhai Livzon Pharmaceutical Equity Investment Management Co., Ltd. ((珠海市丽珠医药股权
投资管理有限公司) “Livzon Equity Investment Company”), a wholly-owned subsidiary of Livzon Group, made the capital
injection to Jiangsu Atom Bioscience and Pharmaceutical Co., Ltd. (“Atom Bioscience”) with its own funds of RMB30 million.
After the capital injection, Livzon Equity Investment Company held 7.4858% equity interest in Atom Bioscience and the
capital verification process have been completed on 18 March 2022. Up to now, the industrial and commercial registration
has been completed.
(2) Establishment of Livzon Biologics (Malaysia) Sdn. bhd.
On 12 January 2022, Livzon Biologics Hong Kong Limited, a controlled subsidiary of Livzon Group, established Livzon
Biologics (Malaysia) Sdn. bhd with a registered capital of 100 Malaysian ringgit wholly held by Livzon Biologics Hong Kong
Limited. The new company was mainly engaged in all businesses of manufacturers, producers, importers, exporters, buyers,
sellers, distribution agents and distributors of patents, pharmaceutical products, medicines, nutrition products, health care
products, drugs and vaccines as well as all related objects, compounds and materials.
2. Major non-equity investment
□Applicable √N/A
3. Financial assets measured at fair value
√Applicable □N/A
As of the end of the Reporting Period, for details of the Company’s financial assets measured at fair value, please refer to
Note 9 “Fair Value” in Chapter X “Financial Statements”.
30 Joincare Pharmaceutical Group Industry Co., Ltd.
(V) Sale of major assets and equity
□ Applicable√ N/A
(VI) Analysis of major controlled and invested companies
√ Applicable □ N/A
Unit: 10,000 Yuan
Nature of Registered Operating
Company business Main product and service capital Asset size Net assets Revenues profit Net profit
Taitai Industry R&D, production and sales of oral 10,000 53,587.90 33,706.01 13,268.07 5,142.79 4,425.65
Pharmaceutical liquids, tablets (hormones), aerosols
(hormones containing), inhalation
formulations (solution for inhalation)
(hormones containing), nasal spray
(hormones containing), and TCM
extraction workshop; production and
sales of health care products.
Taitai Industry Wholesale and retail of skincare 500 202.00 83.59 49.49 -24.24 -40.75
Biotechnology products, cosmetics, and other
daily necessities; domestic business,
material supply and marketing
industry, R&D of health care products
Haibin Pharma Industry Powder injection (including 70,000 248,684.58 138,997.52 88,054.26 17,803.73 15,021.27
penicillin), tablets, hard capsules,
APIs, and sterile APIs. Import and
export businesses and domestic
trade (excluding commodities under
exclusive rights, commodities under
special government control, and
monopolized commodities)
Xinxiang Haibin Industry Manufacturing and sale of 17,000 106,658.70 34,849.95 38,513.87 4,237.38 3,646.69
pharmaceutical products,
intermediates and other chemical
products
Health Industry Production and sale of self-produced HKD7,317 12,463.31 9,491.62 1,180.61 -369.30 -349.99
Pharmaceutical Eagle’s food, health care products,
traditional Chinese medicine
decoction pieces, and drug products
Shanghai Frontier Industry R&D of new pharmaceutical 5,000 17,294.43 10,073.80 3,943.08 -38.23 -129.25
products, health care products,
medical devices, diagnostic reagents,
pharmaceutical intermediates,
and provision of relevant technical
consulting, technical service and
technical transfer
Hiyeah Industry Commerce Investment in industry, domestic 17,800 641.81 592.38 3.67 -15.46 -15.46
commerce, material supply and
marketing industry, and economic
information consulting
Joincare Commerce Wholesale of health care products, 2,500 3,860.34 3,854.01 0.00 -0.07 -0.07
Daily-Use ginseng tea, ginseng lozenges,
ginseng capsules, and stereotyped
packaged food (including health care
products)
Interim Report 2022 31
Nature of Registered Operating
Company business Main product and service capital Asset size Net assets Revenues profit Net profit
Taitai Genomics Industry Screening of human disease-specific 5,000 3,633.22 3,633.22 0.17 3.56 3.56
genes, R&D, production, sale and
technical consulting service of
genetic engineering drugs and
diagnostic reagents, wholesale
of medical devices, and in vitro
diagnostic reagents (except for
diagnostic reagents under special
management)
Appraisal Commerce Forensic evidence identification – 1,001.66 925.55 94.34 -17.25 -19.62
institution
Fenglei Electric Investment Investment in power, industry, 10,000 29,271.97 14,276.36 0.00 85.52 85.52
Power domestic commerce, and material
supply and marketing industry
Hong Kong Investment Investment and trade HKD1 33,916.15 766.76 0.00 86.33 86.33
Pharmaceutical
Jiaozuo Joincare Industry R&D, production and sale of 50,000 251,058.39 165,231.00 75,906.16 13,580.33 11,428.09
pharmaceutic formulations, chemical
APIs, biological APIs, pharmaceutical
intermediates, and biological
products
Topsino Commerce Investment and trade HKD89,693 186,120.66 104,710.39 0.00 21,358.74 21,358.74
Health Investment According to law where it was USD5 2,713.79 2,713.79 0.00 0.00 0.00
Investment registered
Joincare Haibin Industry R&D, production, storage, transport 50,000 85,709.38 64,283.30 31,445.22 21,813.74 18,926.78
and sale of chemical APIs (including
intermediates) and pharmaceutic
formulations. Import and export
businesses and domestic trade
(excluding commodities under
exclusive rights, commodities under
special government control, and
monopolized commodities)
Joincare Special Industry R&D, production and sale of formula 2,000 2,072.70 160.87 0.00 –103.43 –71.67
Medicine Food food, health care products and food
for special medical use
Livzon Group Industry Drug R&D, production, 93,496 2,293,772.91 1,398,682.69 630,256.52 132,515.18 111,750.25
manufacturing and sale
Notes:
1. The companies listed above are companies where the Company directly or indirectly held 100% equity interest, except
for Livzon Group and Shanghai Frontier; financial data thereof are data of individual accounting statements and
that attributed to parent companies; as there are transactions between subsidiaries or between a subsidiary and the
Company, data of individual accounting statements is not separately analyzed.
2. For business conditions of Livzon Group, please refer to the 2022 Interim Report of Livzon Pharmaceutical Group Inc.
(VII) Structured entities controlled by the Company
□ Applicable√ N/A
32 Joincare Pharmaceutical Group Industry Co., Ltd.
V Other matters for disclosure
(I) Potential risks
√ Applicable □ N/A
1. Risks of changes in industrial policies
The pharmaceutical manufacturing industry is significantly affected by changes in industrial policies. The pharmaceutical
industry will face great challenge in development in the future with continuous deepening of medical reform,
advancement of supply-side structural reform in the industry, revision of Drug Administration Law, acceleration of
consistency evaluation of generic drugs, adjustment of the new edition of Medical Insurance Catalogue, expansion
of volume-based procurement, and other industrial policies that have been successively launched. In July 2022, the
Company’s key product Meropenem for Injection (注射用美罗培南) was selected in the seventh batch of volume-based
procurement organised by the PRC Government. This is expected to be implemented in November 2022 and will have a
great impact on the sales price and market share of this product.
Response measures: The Company will pay close attention to industry dynamics and reform, cope with major changes in
policies of the pharmaceutical industry through early layout, transformation and compliance, and actively strengthen new
product R&D and innovation and constantly improve its core competitive strengths. Meanwhile, the Company is actively
engaged in the access to the national reimbursement drug list and negotiation, and continue to increase the coverage
of hospitals and sales, to realize the objective of “price for quantity”, so as to reduce the impact of price adjustment on
the Company’s steady growth. Moreover, the volume-based drug procurement is becoming a regular practice. In the
face of the seventh batch of volume-based drug procurement and the possible impact on the business performance of
the Company, the Company will continue to strengthen innovation and improve its competitiveness, to ensure sound
operation. With the Company’s new high-barrier complex formulation, represented by inhalation formulations, appearing
on the market one after another, commercialization will gradually enter a stable contribution period. The Company’s
product structure will be further optimized, and the reliance on a single product will also gradually reduce. The Company
will make continued efforts to innovate and develop innovative medicines and high-barrier complex formulation with high
added value that are urgently needed for clinical research, explore the types of existing products with market potential
and technical barriers, actively reevaluate key medicines after their marketing and assess the consistency of relevant
medicines, continuously optimize the product structure, and actively explore and expand overseas markets.
2. Market risk
With advancement of supply-side structural reform in the pharmaceutical manufacturing industry and two invoice
policy in circulation domain, pharmaceutical market structure is deeply changed. With the gradual standardization
and centralization of the market, competition in the pharmaceutical industry becomes increasingly fierce. Affected by
increasingly stricter drug regulation, policy-based drug price reduction, price cutting during bidding, medical insurance
premium control, and minimum procurement commitment of the pharmaceutical industry in current stage, bid winning
price of drugs will be further lowered, competition among enterprises in the industry will be intensified, and price war will
occur frequently, thus the Company will be at the risk of drug price reduction.
Response measures: The Company will establish a more reasonable market system through strict compliance operation
so as to maintain its dominant position and core competitive strengths, and ensure that it can achieve sustainable and
steady development and improve its profitability by reinforcing marketing. Meanwhile, the Company will offset the impact
of product price reduction by means of price supplement based on quantity, and optimize technical process and reduce
production costs through internal exploration and transformation. Moreover, the Company will speed up the R&D and
marketing of new products, spread risks of the Company while expanding the range of existing products in segment
markets, improve sales and form new profit growth point by increasing product varieties in the future.
Interim Report 2022 33
3. Risk of environmental protection
The Company is an integrated pharmaceutical manufacturing enterprise. During production, it implements relevant
chemical synthesis process and uses a large number of acid and alkali and other chemical components, which are
inflammable, explosive, toxic, irritant and corrosive, and have hidden hazards of fire, explosion and poisoning, posing
certain risks to the production and operation of the Company. As environmental protection policies and regulations have
been constantly issued in recent years, environmental protection standards have become more stringent, and the state
has strengthened its control over pollutants, risks of environmental protection of the Company are increasing.
Response measures: The Company has always obeyed the safety work concept of “Putting People First” and the guideline
of “Safety First, Precaution Crucial and Comprehensive Treatment”. It will strengthen the construction of safe production
infrastructure and ensure a sound environment for safe production of the Company through regular internal audit of
safety and environment systems and employee safety education and training. The Company will carry out discharge after
treatment and reaching standards in accordance with environmental protection provisions, actively accept supervision and
inspection of environmental protection authorities, and try to reduce emission and increase expenditures in environmental
protection by improving production process and promptly updating environmental protection technology.
4. Risk in purchase price and supply of raw materials
There is a larger fluctuation in the supply price of some raw materials of the Company due to changes in material prices,
especially the materials of traditional Chinese medicine, causing greater volatility or rise in production costs of the
Company. Meanwhile, the quantity and category of raw material suppliers of the Company are various, thus quality of final
products of the Company will be directly affected by the selection of raw material suppliers and the guarantee and control
of quality of raw materials.
Response measures: In terms of selection of suppliers, the Company will conduct an open tendering and bidding based
on the principle of selecting qualified suppliers, strengthen audit of suppliers, and eliminate the adulteration of adverse
suppliers. The Quality Assurance Department and Supply Department of the Company will directly conduct process control
of products provided by suppliers of key raw materials and carry out quality inspection and control of final products.
5. Risk of R&D for new drugs
New drug R&D is characterized by high input, high risk and long period. The State has frequently issued drug R&D related
policies in recent years to further enhance approval work requirements of new drugs for marketing, thus bringing certain
risks for new drug R&D of the Company. Meanwhile, promotion of drugs after marketing is affected by national regulations,
industry policies, market environment and competitive intensity, causing that income obtained after marketing of new
drugs cannot reach the expected income, making the Company at risk of product R&D.
Response measures: The Company will focus on innovative medicines and high-barrier complex formulation, pay
attention to unmet clinical needs, and continuously invest in innovative research and development. The Company
will further improve the R&D and innovation systems, introduce and develop high-end talents, proactively carry out
cooperation and introduction of overseas innovative medicines, strengthen market research and evaluation of varieties,
reinforce the process regulation and risk management of the initiation of R&D projects, and concentrate efforts and make
key breakthroughs in the R&D of core products. At the same time, the Group’s advantages in APIs will be fully utilized to
reinforce the integration of API and drug formulations to ensure the long-term sustainable development of the Company.
34 Joincare Pharmaceutical Group Industry Co., Ltd.
6. Risk of the normalization of COVID-19 pandemic
The COVID-19 pandemic brought certain impact on China’s overall economic performance. As the demand for prescription
medicines irrelevant to the pandemic dropped due to the decline of outpatients and inpatients in medical institutions,
the sales of some products were lower than expected, and the Company’s production and operations were affected to
a certain extent. Since March 2022, the COVID-19 pandemic has broken out in Shanghai with the emergence of mutant
strains, and outbreaks have occurred and repeated across the country. As of 30 June 2022, the COVID-19 pandemic
generally remained stable nationwide. In the first half of 2022, China implemented pandemic prevention and control on
a continuing basis and promoted vaccination against the virus in an orderly manner. According to data on the official
website of the National Health Commission, as of 30 June 2022, 31 provinces (autonomous regions and municipalities) and
Xinjiang Production and Construction Commission had reported a total of 3,402.622 million doses of vaccines vaccinated.
Response measures: In response to the sporadic outbreaks, the Company responded to the government’s demand at the
first time, actively carried out epidemic prevention and control, strictly implemented relevant measures and coordinated
epidemic prevention and control, production and operation. During the outbreak in Shanghai, the Company arranged and
adjusted the R&D tasks in advance and transferred the experimental projects to the teams of Guangzhou and Shenzhen.
The progress of the Company’s R&D projects was not materially affected, and a multi-location and seamless working mode
was realized. In general, the Company during the Reporting Period was under normal operation, and the overall impact
of the COVID-19 pandemic on its business was relatively slight. The extent of its subsequent impact will depend on the
prevention and control of the pandemic on a global scale, the time of continuation, the prevention and control of the
pandemic, and the responsive measures of enterprises. The Company will continue to pay attention to the development of
the pandemic and any possible impact on the financial conditions and operating results of the Company, while adopting
various measures at the same time to mitigate the adverse effect of the pandemic on corporate operations, to ensure
that the production and operation activities are performed in a steady and orderly manner. Measures include improving
operational management, controlling various operational risks, and promoting innovation and collaboration. In the face of
the new global market pattern brought out by COVID-19, the Company will strengthen the export advantages of featured
APIs, set up an Internet operation center, strengthen online promotion of some formulations, and accelerate the overseas
clinical progress of COVID-19 vaccine, so as to contribute to the global supply of COVID-19 vaccines and actively fulfill its
social responsibilities.
(II) Other matters for disclosure
□ Applicable√ N/A
Corporate
Governance
4
36 Joincare Pharmaceutical Group Industry Co., Ltd.
Chapter 4 Corporate Governance
I Introduction of General Meetings
Query index of
Meeting sessions Date of meeting designated website Disclosure date Meeting resolution
2022 First Extraordinary 11 February 2022 www.sse.com.cn 12 February 2022 Eight (8) resolutions were
General Meeting considered and approved,
including the Resolution on
Changing Certain Projects
Invested with Proceeds and
the Resolution on Revision
of Certain Clauses of Articles
of Association. See the
Announcement on Resolutions
of Joincare Pharmaceutical
Group Industry Co., Ltd. at the
2022 First Extraordinary General
Meeting (Lin 2022-014) for
details
2021 Annual General 18 May 2022 www.sse.com.cn 19 May 2022 Fourteen (14) resolutions were
Meeting considered and approved,
including the 2021 Annual
Work Report of the Supervisory
Committee, the Resolution on
Election of Mr. Xing Zhiwei as
Supervisor of the Company,
2021 Annual Work Report of the
Board of Directors, 2021 Annual
Profit Distribution Scheme, and
2021 Annual Report of Joincare
Pharmaceutical Group Industry
Co., Ltd. (Full Text and Abstract).
See the Announcement
on Resolutions of Joincare
Pharmaceutical Group Industry
Co., Ltd. at the 2021 Annual
General Meeting (Lin 2022-051)
for details
Holders of Preferred Shares with Resumed Voting Rights Requesting to Hold Extraordinary General
Meeting
□ Applicable√ N/A
Description of General Meetings
□ Applicable√ N/A
Interim Report 2022 37
II Changes in directors, supervisors and senior management of the Company
√ Applicable □ N/A
Name Position Change
Xie Youguo Supervisor Resigned
Xing Zhiwei Supervisor Elected
Description of changes in directors, supervisors and senior management of the Company
√ Applicable □ N/A
During the reporting period, the Supervisory Committee of the Company received a written resignation letter from Mr.
Xie Youguo, a Supervisor of the Company. Mr. Xie Youguo applied for resignation from this position of Supervisor due to
personal reasons. He continued to hold other positions in the Company even if resigned as supervisor. Before the new
supervisor was elected at the General Meeting of the Company, Mr. Xie Youguo continued to perform his duties as a
supervisor. In order to ensure the normal operation of the Supervisory Committee, the Company held the ninth Meeting
of the eighth Session of the Supervisory Committee to consider and approve the “the Resolution on Election of Mr. Xing
Zhiwei as Supervisor of the Company” on 22 April 2022. please see the “Announcement of Joincare Pharmaceutical Group
Industry Co., Ltd. on the Resignation of Supervisors and the By-election of Supervisors (Lin 2022-046) for details. On 18 May
2022, the Company held the 2021 Annual General Meeting to consider and approve the aforesaid resolution to elect Mr.
Xing Zhiwei as a supervisor of the eighth session of the Supervisory Committee of the Company for a term commencing
from the date of consideration and approval at the General Meeting to the date of expiry of the term of the eighth session
of the Supervisory Committee.
III Profit distribution plan and plan for conversion of capital reserve into share
capital
Profit distribution plan and plan for conversion of capital reserve into share capital proposed for the first
six months of 2022
Distribution or conversion or not No
Number of bonus shares to be distributed for every ten shares (share) N/A
Amount to be distributed for every ten shares (RMB) (tax inclusive) N/A
Number of shares to be converted into share capital for every ten shares (share) N/A
Description of profit distribution plan and plan for conversion of capital reserve into share capital N/A
38 Joincare Pharmaceutical Group Industry Co., Ltd.
IV Equity incentive scheme, employee share ownership scheme or other employee
incentives of the Company and their effect
(I) Matters related to equity incentive scheme have been disclosed in the Provisional Announcements with
no progress or change in subsequent implementation
√ Applicable □ N/A
Overview Query index
The third exercise period under the first grant of the See the Announcement on 2022 Q1 Independent Exercise
2018 Share Options Incentive Scheme of the Company Results of the 2018 Share Options Incentive Scheme of
started on 21 December 2021 until 20 December 2022 Joincare Pharmaceutical Group Industry Co., Ltd. & Changes
by way of independent exercise. The second exercise in Shares (Lin 2022-038) disclosed by the Company on 2
period under the reserved grant of share options started April 2022 for details.
on 23 September 2021 until 22 September 2022 by way
of independent exercise. The total number of share
options exercised was 4,005,170 from 1 January 2022 to 31
March 2022. As at 31 March 2022, the number of options
cumulatively exercised and completing share transfer
registration under the first grant and reserved grant of the
2018 Share Options Incentive Scheme of the Company was
28,835,036.
The Resolution on the Second Phase Share Ownership See the Announcement on Resolutions of Joincare
Scheme under Medium to Long-term Business Partner Pharmaceutical Group Industry Co., Ltd. at the Congress
Share Ownership Scheme of the Company (Draft) and of Workers and Staff (Lin 2022-044), Announcement on
its Summary and the Resolution on the General Meeting Resolutions of Joincare Pharmaceutical Group Industry
for Granting Mandate to the Board to Deal with Matters Co., Ltd. at the 10th Meeting of the 8th Session of the
Related to the Second Phase Share Ownership Scheme Board (Lin 2022-047), Announcement on Resolutions of
under Medium to Long-term Business Partner Share Joincare Pharmaceutical Group Industry Co., Ltd. At the 9th
Ownership Scheme of the Company were considered Meeting of the 8th Session of the Supervisory Committee
and approved at the Congress of Workers and Staff, the (Lin 2022-045), and the Second Phase Share Ownership
10th Meeting of the 8th Session of the Board, and the 9th Scheme under Medium to Long-term Business Partner
Meeting of the 8th Session of the Supervisory Committee Share Ownership Scheme of Joincare Pharmaceutical Group
on 22 April 2022. Industry Co., Ltd. (Draft) and its Summary disclosed by the
The said resolutions were considered and approved at the Company on 25 April 2022 for details.
2021 Annual General Meeting on 18 May 2022. See the Announcement on Resolutions of Joincare
Pharmaceutical Group Industry Co., Ltd. at the 2021 Annual
General Meeting (Lin 2022-051) disclosed by the Company
on 19 May 2022 for details.
The Resolution on Revision of the Second Phase Share See the Announcement on Resolution in Relation to
Ownership Scheme under Medium to Long-term Revision of the Second Phase Share Ownership Scheme
Business Partner Share Ownership Scheme of Joincare under Medium to Long-term Business Partner Share
Pharmaceutical Group Industry Co., Ltd. (Draft) and its Ownership Scheme of Joincare Pharmaceutical Group
Summary was considered and approved at the 11th Industry Co., Ltd. (Draft) and its Summary (Lin 2022-053),
Meeting of the 8th Session of the Board and at the 10th and the Second Phase Share Ownership Scheme under
Meeting of the 8th Session of the Supervisory Committee Medium to Long-term Business Partner Share Ownership
on 31 May 2022. Scheme of Joincare Pharmaceutical Group Industry Co., Ltd.
(Revised Draft) and its Summary disclosed by the Company
on 1 June 2022 for details.
Interim Report 2022 39
Overview Query index
On 1 June 2022, the First Holders’ Meeting of the Second See the Announcement on Resolutions of Joincare
Phase Share Ownership Scheme of Medium to Long-term Pharmaceutical Group Industry Co., Ltd. at the First Holders’
Business Partners was held by the Company. This meeting Meeting of the Second Phase Share Ownership Scheme
considered and approved the Resolution on Establishing of Medium to Long-term Business Partners (Lin 2022-056)
the Management Committee of the Second Phase Share disclosed by the Company on 2 June 2022 for details.
Ownership Scheme of the Company, the Resolution on
Electing Members of the Management Committee of the
Second Phase Share Ownership Scheme and the Resolution
on Authorizing the Management Committee of the Second
Phase Share Ownership Scheme of the Company to Handle
Matters Related to the Employee Share Ownership Scheme.
As of 7 June 2022, the Second Phase Share Ownership See the Announcement of Joincare Pharmaceutical Group
Scheme of the Company has purchased a total of 6,275,372 Industry Co., Ltd. on Completing the Purchase of Shares for
shares by way of secondary market centralized bidding the Second Phase Share Ownership Scheme under Medium
trading, representing 0.33% of the total share capital of to Long-term Business Partner Share Ownership Scheme
the Company (1,911,733,078 shares), with a total turnover (Lin 2022-059) disclosed by the Company on 8 June 2022
of RMB75,740,661.60 and an average transaction price of for details.
approximately RMB12.07 per share. Then the Company has
completed the purchase of the underlying shares for the
Second Phase Share Ownership Scheme.
The Resolution on Adjusting the Exercise Price of the 2018 See the Announcement on Adjusting the Exercise Price of
Share Options Incentive Scheme of the Company was the 2018 Share Options Incentive Scheme of the Company
considered and approved at the 14th Meeting of the 8th by Joincare Pharmaceutical Group Industry Co., Ltd. (Lin
Session of the Board and at the 12th Meeting of the 8th 2022-069) disclosed by the Company on 1 July 2022 for
Session of the Supervisory Committee on 30 June 2022. details.
Due to profit distribution, the exercise price under the first
grant was adjusted to RMB7.59 per share, while that under
the reserved grant was adjusted to RMB10.01 per share.
The number of options exercised in total was 807,589 See the Announcement on 2022 Q2 Independent Exercise
from 1 April 2022 to 30 June 2022. As at 30 June 2022, the Results of the 2018 Share Options Incentive Scheme of
number of options cumulatively exercised and completing Joincare Pharmaceutical Group Industry Co., Ltd. & Changes
share transfer registration under the first grant and in Shares (Lin 2022-071) disclosed by the Company on 2
reserved grant of the 2018 Share Options Incentive Scheme July 2022 for details.
of the Company was 29,642,625.
(II) Incentives not disclosed in the Provisional Announcements or with subsequent progress
Equity incentives
□ Applicable√ N/A
Others
□ Applicable√ N/A
Employee share ownership scheme
□ Applicable√ N/A
Other incentive program
□ Applicable√ N/A
5
Environmental
and Corporate
Social
Responsibility
Interim Report 2022 41
Chapter 5 Environmental and Corporate Social Responsibility
I Environmental information
(I) Environmental Issues of Companies and Their Major Subsidiaries Belonging to Key Pollutant Discharging
Units as Announced by the Environmental Protection Department
√ Applicable □ N/A
1. Pollution discharge information
√ Applicable □ N/A
i. Jiaozuo Joincare
Name of Name of major Number of Distribution Pollutant discharge Total Total amount
company or pollutants and Mode of discharge of discharge Discharge standards amount of of discharge Excessive
subsidiary specific pollutants discharge outlets outlets concentration implemented discharge approved discharge
(mg/L) (mg/L) (t/a) (t/a)
Jiaozuo Chemical oxygen Continuous 1 Master outlet 114.33 220 351.99 942.1 Nil
Joincare demand for sewage
Ammonia nitrogen Continuous 15.39 35 47.38 105.3 Nil
ii. Taitai Pharmaceutical
Name of Name of major Number of Distribution Pollutant discharge Total Total amount
company or pollutants and Mode of discharge of discharge Discharge standards amount of of discharge Excessive
subsidiary specific pollutants discharge outlets outlets concentration implemented discharge approved discharge
(mg/L) (mg/L) (t/a) (t/a)
Taitai Chemical oxygen Intermittent 1 Master outlet 46.5 345 0.212 / Nil
Pharmaceutical demand for sewage
Biochemical 1 150 0.0047 / Nil
oxygen demand
Suspended solids 4 250 0.014 / Nil
pH value 7.83 6-9 / / Nil
Sulfur dioxide Intermittent 1 Discharge 1.4 50 0.0084 / Nil
Nitrogen oxide outlet of boiler 14.95 150 0.089 / Nil
exhaust gas
Particulate matter 9.34 20 0.056 / Nil
42 Joincare Pharmaceutical Group Industry Co., Ltd.
iii. Haibin Pharma
Name of Name of major Number of Distribution Pollutant discharge Total Total amount
company or pollutants and Mode of discharge of discharge Discharge standards amount of of discharge Excessive
subsidiary specific pollutants discharge outlets outlets concentration implemented discharge approved discharge
(mg/L) (mg/L) (t/a) (t/a)
Haibin Pharma Chemical oxygen Intermittent 1 Master outlet 54 500 1.55 41.65 Nil
demand for sewage
Ammonia nitrogen 1 Master outlet 0.8 45 0.023 3.7485 Nil
for sewage
Particulate matter 1 Discharge 1.4 20 0.02 / Nil
outlet of boiler
exhaust gas
Sulfur dioxide 1 Discharge 5 50 0.08 / Nil
outlet of boiler
exhaust gas
Nitrogen oxide 1 Discharge 20 150 0.33 / Nil
outlet of boiler
exhaust gas
Volatile organic 2 Discharge 7.7 60 0.5 5.544 Nil
compounds outlet of
process organic
exhaust gas
and tank farm
exhaust gas
iv. Xinxiang Haibin
Name of Name of major Number of Distribution Pollutant discharge Total Total amount
company or pollutants and Mode of discharge of discharge Discharge standards amount of of discharge Excessive
subsidiary specific pollutants discharge outlets outlets concentration implemented discharge approved discharge
(mg/L) (mg/L) (t/a) (t/a)
Xinxiang Chemical oxygen Continuous 1 Master outlet 51.1 220 4.05 14.81 Nil
Haibin demand for sewage
Ammonia nitrogen Continuous 8.05 35 0.56 1.66 Nil
v. Fuzhou Fuxing
Name of Name of major Number of Distribution Pollutant discharge Total Total amount
company or pollutants and Mode of discharge of discharge Discharge standards amount of of discharge Excessive
subsidiary specific pollutants discharge outlets outlets concentration implemented discharge approved discharge
(mg/L) (mg/L) (t) (t/a)
Fuzhou Fuxing Chemical oxygen Intermittent 1 The northwest 14.53 100 7.27 124.5 Nil
demand (COD) side of the
Ammonia nitrogen factory 0.23 15 0.12 18.7 Nil
Note: The discharge concentration represents the actual discharge concentration, and the standards implemented
represent the standards for discharge to the environment by Jiangyin sewage plant (江阴污水处理厂) (i.e. COD≤ 100mg/L,
ammonia nitrogen ≤ 15mg/L), and the agreed standard for discharge of COD and ammonia nitrogen from the company to
Jiangyin sewage plant shall be ≤ 500mg/L and ≤ 60mg/L, respectively. The data was obtained from Fuqing Environmental
Protection Bureau.
Interim Report 2022 43
vi. Xinbeijiang Pharmaceutical
Name of Name of major Number of Distribution Pollutant discharge Total Total amount
company or pollutants and Mode of discharge of discharge Discharge standards amount of of discharge Excessive
subsidiary specific pollutants discharge outlets outlets concentration implemented discharge approved discharge
(mg/L) (mg/L) (t) (t/a)
Xinbeijiang Chemical oxygen Intermittent 1 Sewage 78.5 240 31.71 Nil Nil
Pharmaceutical demand treatment
Ammonia nitrogen workshop 2.7 70 1.10 Nil Nil
Note: The discharge concentration represents the concentration of discharge into Qingyuan Henghe Sewage Treatment
Plant (清远横荷污水处理厂), while the standard adopted for discharge represents the standard stipulated in the pollutant
discharge license of the company, i.e. COD≤ 240mg/L, ammonia nitrogen ≤ 70mg/L. The data was obtained from
Qingyuan Environmental Protection Bureau.
vii. Livzon Hecheng
Name of Name of major Number of Distribution Pollutant discharge Total Total amount
company or pollutants and Mode of discharge of discharge Discharge standards amount of of discharge Excessive
subsidiary specific pollutants discharge outlets outlets concentration implemented discharge approved discharge
(mg/L)/(mg/m3) (mg/L)/(mg/m3) (t) (t/a)
Livzon Hecheng Chemical oxygen Intermittent 1 Wastewater 85.585 192 7.969 / Nil
demand treatment
station
Ammonia 8.128 40 0.6748 / Nil
nitrogen (NH3-N)
Sulfur dioxide Organized 3 Boiler room 3 50 0.044 / Nil
Nitrogen oxide continuous 3 Boiler room 74.85 150 1.2078 / Nil
emission
Particulate matter 3 Boiler room 1.43 20 0.0187 / Nil
Hydrogen chloride 7 Workshop 2.29 100 0.7063 / Nil
Non-methane 7 Workshop 11.41 60 3.790 77.76 Nil
hydrocarbons
Non-methane 1 RTO 5.25 60 0.2670 Nil
hydrocarbons
Nitrogen oxide 1 RTO 30 200 1.8892 / Nil
Sulfur dioxide 1 RTO 3 200 0.1889 / Nil
Notes:
1. The discharge concentration of pollutants in waste water represents the average concentration by online monitoring
from the master discharge outlet by the company into South District Sewage Treatment Plant, while the standard
adopted for discharge represents the standard stipulated in the pollutant discharge license of the company, i.e. COD≤
192mg/L, ammonia nitrogen≤ 40mg/L.
2. The discharge concentration of pollutants in the discharge outlet of waste gas represents the average concentration
detected by a qualified third party engaged, of which the boiler exhaust adopted the Emission Standard for Boiler
Atmospheric Pollutants in Guangdong Province 《广东省锅炉大气污染物排放标准》) (DB44/765-2019), the workshop
(
and wastewater treatment station emission complied with the Air Pollutant Discharge Standards for Pharmaceutical
Industry《制药工业大气污染物排放标准》) (GB37823-2019).
(
44 Joincare Pharmaceutical Group Industry Co., Ltd.
viii. Gutian Fuxing
Name of Name of major Number of Distribution Pollutant discharge Total Total amount
company or pollutants and Mode of discharge of discharge Discharge standards amount of of discharge Excessive
subsidiary specific pollutants discharge outlets outlets concentration implemented discharge approved discharge
(mg/L) (mg/L) (t) (t/a)
Gutian Fuxing Chemical oxygen Continuous 1 The southeast 46.55 120 6.209 108 Nil
demand side of the
Ammonia nitrogen factory 9.93 35 1.27 31.5 Nil
Note: The discharge concentration represents the concentration of ultimate discharge into the environment, while the
standard adopted for discharge represents the standard stipulated in the pollutant discharge license of the company, i.e.
COD≤ 120mg/L, ammonia nitrogen≤ 35mg/L.
ix. Livzon Limin
Name of Name of major Number of Distribution Pollutant discharge Total Total amount
company or pollutants and Mode of discharge of discharge Discharge standards amount of of discharge Excessive
subsidiary specific pollutants discharge outlets outlets concentration implemented discharge approved discharge
(mg/L) (mg/L) (t) (t/a)
Livzon Limin Chemical oxygen Intermittent 1 Wastewater 23.5 110 2.9 Nil Nil
demand treatment
Ammonia nitrogen station 0.3892 15 0.05 Nil Nil
Note: The waste water of Livzon Limin was discharged into Shaoguan Second Sewage Treatment Plant (韶关市第二污水
处理厂) and the standard adopted for pollutant discharge represented the standard stipulated in the pollutant discharge
license of the company, i.e. COD≤ 110mg/L, ammonia nitrogen ≤ 15mg/L, while the data detected by a third party
inspection firm was adopted as the discharge concentration.
x. Livzon Pharmaceutical Factory
Name of Name of major Number of Distribution Pollutant discharge Total Total amount
company or pollutants and Mode of discharge of discharge Discharge standards amount of of discharge Excessive
subsidiary specific pollutants discharge outlets outlets concentration implemented discharge approved discharge
(mg/L) (mg/L) (t) (t/a)
Livzon Chemical oxygen Intermittent 1 Wastewater 18.48 120 1.15 Nil Nil
Pharmaceutical demand treatment
Factory station
Ammonia nitrogen 1 Wastewater 0.11 20 0.007 Nil Nil
treatment
station
Note: The discharge concentration of pollutants in the wastewater discharge outlet represents the average concentration
detected by a qualified third party engaged, by implementing the strictest of Schedule 2 Water Pollutant Discharge
Concentration Limits for Newly-Built Enterprises (表2 新建企业水污染物排放浓度限值) of the Emission Standard for
Pharmaceutical Industrial Water Pollutants from Mixing and Formulation Category 《混装制剂类制药工业水污染物排放
(
标准》) (GB21908-2008), Schedule 2 Water Pollutant Discharge Concentration Limits for Newly-Built Enterprises (表2 新建
企业水污染物排放浓度限值) of Discharge Standards for Biopharmaceutical Industrial Wastewater 《生物工程类制药工
(
业水污染物排放标准》) (GB21907-2008), or the level 1 of phase II standard of Guangdong Provincial Capping on Polluted
Effluents Discharge《广东省水污染物排放限值》) (DB44/26-2001).
(
Interim Report 2022 45
xi. Ningxia Pharmaceutical
Name of Name of major Number of Distribution Pollutant discharge Total Total amount
company or pollutants and Mode of discharge of discharge Discharge standards amount of of discharge Excessive
subsidiary specific pollutants discharge outlets outlets concentration implemented discharge approved discharge
(mg/L)/(mg/m3) (mg/L)/(mg/m3) (t) (t/a)
Ningxia Chemical oxygen Continuous 1 Sewage 121 200 67.5 Nil Nil
Pharmaceutical demand treatment
Ammonia nitrogen workshop on 1.3 25 0.74 Nil Nil
north side of
factory zone
Sulfur dioxide 1 Boiler workshop 53 200 19.61 156.816 Nil
Nitrogen oxide on north side of 92 200 35.77 156.816 Nil
Particulate matter factory zone 8 30 2.92 23.522 Nil
Volatile organic 9 4 outlets for 2.7 100 1.25 79.535 Nil
compounds fermentation,
3 outlets for
refinery and
2 outlets for
sewage
Notes:
(1) The discharge concentration of wastewater represents the concentration of ultimate discharge to the environmental
protection control center of Ningxia Xin’an Technology Co., Ltd. (宁夏新安科技有限公司) (“Xin’an Company”),
the standard adopted for pollutant discharge was the standard stipulated in the pollutant discharge license of the
company and the amount of discharge was calculated by the amount received by Xin’an Company. In respect of the
total amount of approved discharge, since Ningxia Pharmaceutical adopted indirect discharge, the local government
of Ningxia canceled the limitation of total discharge of chemical oxygen demand and ammonia nitrogen of all
indirect discharge enterprises, and the total amount index was directly allocated to sewage treatment plants in the
pharmaceutical industrial park established by the government after the renewal of the pollution discharge license.
(2) The emission concentration of boiler exhaust gas represents the self-monitoring average concentration throughout
the year, the standard adopted for discharge was the standard stipulated in the pollutant discharge license of
the company and the amount of discharge was calculated by the amount indicated by online monitoring. The
concentration of volatile organic compounds (VOCs) represents the concentration of ultimate discharge to the
environment (self-monitoring concentration), the adopted standard was the standard limits stipulated in Schedule I of
the Air Pollutant Discharge Standards for Pharmaceutical Industry 《制药工业大气污染物排放标准》) (GB37823-2019)
(
and the amount of discharge was calculated by the amount of exhaust gas emissions and the discharge concentration
recorded by the monitoring report.
xii. Jiaozuo Hecheng
Name of Name of major Number of Distribution Pollutant discharge Total Total amount
company or pollutants and Mode of discharge of discharge Discharge standards amount of of discharge Excessive
subsidiary specific pollutants discharge outlets outlets concentration implemented discharge approved discharge
(mg/L) (mg/L) (t) (t/a)
Jiaozuo Chemical oxygen Continuous 1 Master outlet 94.201 220 3.97 60.8 Nil
Hecheng demand in industrial
Ammonia nitrogen wastewater 3.24 35 0.138 8.8 Nil
workshop
Note: The discharge concentration and the total amount of discharge represent the concentration and total amount of
ultimate discharge into the downstream sewage treatment plant, and the source is online monitoring data.
46 Joincare Pharmaceutical Group Industry Co., Ltd.
xiii. Shanghai Livzon
Name of Name of major Number of Distribution Pollutant discharge Total Total amount
company or pollutants and Mode of discharge of discharge Discharge standards amount of of discharge Excessive
subsidiary specific pollutants discharge outlets outlets concentration implemented discharge approved discharge
(mg/L)/(mg/m3) (mg/L)/(mg/m3) (t) (t/a)
Shanghai Livzon Chemical oxygen Intermittent 1 Master outlet in 42 500 1.12 Nil Nil
demand the park
Ammonia nitrogen 5.35 40 0.12 Nil Nil
Particulate matter Organized and 2 No. 5 and 6 – – – – Nil
intermittent outlet on the
discharge roof
Volatile organic 8 No. 1, 2, 3, 4, 7, 8, 2.45 60 0.003 2.145 Nil
compounds 9 and 10 outlets
on the roof
Note: The discharge concentration was the average of monthly third-party monitoring data, and the amount of discharge
was the cumulative sum of monthly discharge. The discharge of VOCs and particulate were in accordance with the Air
Pollutant Discharge Standards for Pharmaceutical Industry 《制药工业大气污染物排放标准》) (GB37823-2019), and the
(
discharge of COD and Ammonia nitrogen were implemented in accordance with the comprehensive sewage discharge
standard DB31/199-2018. Shanghai Livzon was among other key pollutant discharge units, but not among the key
pollutant discharge units of water environment and atmospheric environment.
xiv. Livzon MAB
Name of Name of major Number of Distribution Pollutant discharge Total Total amount
company or pollutants and Mode of discharge of discharge Discharge standards amount of of discharge Excessive
subsidiary specific pollutants discharge outlets outlets concentration implemented discharge approved discharge
(mg/L) (mg/L) (t) (t/a)
Livzon MAB Chemical oxygen Intermittent 1 Wastewater 18.48 120 0.78 Nil Nil
demand treatment
station
Ammonia nitrogen 1 Wastewater 0.11 20 0.005 Nil Nil
treatment
station
Note: The discharge concentration of pollutants in the wastewater discharge outlet represents the average concentration
detected by a qualified third party engaged, by implementing the strictest of Schedule 2 Water Pollutant Discharge
Concentration Limits for Newly-Built Enterprises (表2 新建企业水污染物排放浓度限值) of the Emission Standard for
Pharmaceutical Industrial Water Pollutants from Mixing and Formulation Category 《混装制剂类制药工业水污染物排放
(
标准》) (GB21908-2008), Schedule 2 Water Pollutant Discharge Concentration Limits for Newly-Built Enterprises (表2 新建
企业水污染物排放浓度限值) of Discharge Standards for Biopharmaceutical Industrial Wastewater 《生物工程类制药工
(
业水污染物排放标准》) (GB21907-2008), or the level 1 of phase II standard of Guangdong Provincial Capping on Polluted
Effluents Discharge《广东省水污染物排放限值》) (DB44/26-2001).
(
Interim Report 2022 47
2. Construction and operation of pollution preventive facilities
√ Applicable □ N/A
Name of company
or subsidiary Construction and operation of pollution preventive facilities
Jiaozuo Joincare Exhaust gas: The treatment process of “water spray + acid spray + alkali spray + mist eliminator
+ dry filter + adsorption concentrator + RCO” was adopted for fermentation exhaust gas. The
treatment process of “bag type dust collector” was adopted for proportioning process dust-
laden exhaust gas. The treatment process of “secondary alkali spray” was adopted for exhaust
gas treatment facilities in wastewater treatment station. The treatment process of “alkali
adsorption” was adopted for process acid waste gas. The treatment process of “tertiary finned
condenser + bag type dust collector + secondary alkali spray + RTO”/“-20° condensation +
activated carbon adsorption device (including regenerating device) + RTO”/“adsorption device
(including regenerating device)+ secondary alkali spray + biological uptake + secondary alkali
spray”/“secondary alkali spray + biological uptake + secondary alkali spray” was adopted for process
organic exhaust gas. All of them enable stable and up-to-standard discharge of exhaust gas.
Wastewater: The treatment process of “regulating pool + hydrolysis acidification pool + UASB +
(CASS + air flotation)/modified A/O + secondary settling tank + coagulating sedimentation” was
primarily adopted. Standard wastewater outlets were set; online automatic monitoring control
system was installed at outlets for real-time monitoring of COD, ammonia nitrogen, total nitrogen,
pH, and flow. At present, wastewater treatment process sections can be stably operated. Moreover,
indicators of wastewater factors are stable and satisfy the discharge standard.
Taitai No new facilities were set up. Pollution preventive facilities functioned properly and ensured up-
Pharmaceutical to-standard discharge.
Haibin Pharma Pollution treatment facilities functioned properly and ensured up-to-standard discharge. A set of
laboratory exhaust gas treatment system was newly built.
Xinxiang Haibin Wastewater: The wastewater treatment system with daily processing capacity of 600 tons through
A/O process designed by East China University of Science and Technology started operation in
April 2016 and has been functioning properly in the first half of 2022. Moreover, indicators can
be stable and satisfy the required discharge standard. A set of MVR concentration wastewater
treatment plant was added in April 2020, which has been functioning properly in the first half
of 2022. From the second half of 2021 to March 2022, a set of lift aerator system and a set of
magnetic levitation blower were added in the biochemical system, and they have been put into
operation and functioning properly. A new sewage anaerobic treatment system was built in the
first half of 2022 and is currently under commissioning.
Exhaust gas: The 40,000 m/h regenerative oxidation exhaust gas treatment system designed
by Jiangsu Ruiding started operation on 2 November 2019 and has been functioning properly
in the first half of 2022. Moreover, factors achieved ultra-low discharge. After reconstruction of
dry tail gas self-circulating process, the activated carbon adsorption pre-treatment device for
high concentration waste gas designed by Beijing Rixin Daneng Technology Co., Ltd. has been
functioning properly in the first half of 2022. After alkali spray and water spray, the exhaust gas
from biochemical aerobic process of wastewater treatment was emitted in compliance with
the required standard, which has been functioning properly in the first half year 2022. A set
of tetrahydrofuran membrane recovery system was added for high concentration exhaust gas
treatment of six workshops, which has been functioning properly in the first half year 2022.
The resin adsorption pre-treatment facility of exhaust gas was added and is currently under
construction.
48 Joincare Pharmaceutical Group Industry Co., Ltd.
Name of company
or subsidiary Construction and operation of pollution preventive facilities
Fuzhou Fuxing The Company strictly complies with the “Three-Simultaneous” system, collects and treats “Three
Wastes (waste water, exhaust gas and solid waste)” according to requirements, and employs an
advanced sewage treatment process known as “regulating pool + hydrolysis acidification tank +
SBR + air float”. After the sewage has gone through the above treatment process, all indicators are
stable and satisfy the discharge standard. After meeting the discharge standards, the sewage is
discharged to Jiangyin sewage plant operated by Fujian Huadong Water Treatment Co., Ltd. (福建
华东水务有限公司) via sewage pipe network at the industrial park area for further treatment. In
2022, exhaust gas treatment facilities such as the Fenton pool and the regulating pool were added,
and the exhaust gas was treated by secondary spray.
Xinbeijiang The “Three Wastes” were collected and treated effectively in strict compliance with the “Three
Pharmaceutical Simultaneous” system. The sewage treatment facilities with an investment amount of over RMB30
million have a designed processing capacity of 3,000t/d and adopt the treatment process of
“Pretreatment + Aerobic pool + Hydrolysis acidification tank + SBR + Catalytic oxidation + Air
float”. In the first half of 2022, the third round of environmental protection improvement was
implemented, including the replacement of biological deodorizer tanks and the addition of spray
towers in sewage stations, the reinstallation of the pretreatment exhaust gas collection pipes,
which reduced the disorganized emission of exhaust gas and greatly improved the odor around
sewage stations; mufflers were installed in sewage stations and discharge outlets of the second
fermentation department to lower the air flow of exhaust gas emissions; MVR circulating pumps
and vapor compressors were enclosed with sound-absorbing cotton panels, which greatly lowered
the noise of the MVR; sound-absorbing cotton panels were also put around many other noisy
equipment, so as to control the generation and transmission of noise at source.
Livzon Hecheng The “Three Wastes” were treated in a centralized and effective manner in strict compliance with
the “Three Simultaneous” system and the maintenance and management of pollution preventive
facilities were enhanced to ensure that emission of pollutants was stable and in compliance with
the required standard. The treatment process of “pre-treatment of drainage from the production
process + hydrolytic acidification + up-flow anaerobic sludge blanket (UASB) + advanced oxidation
+ CASS process + air float/ozonation advanced treatment” was adopted. Treated sewage was
discharged through the municipal sewage pipeline network into Zhuhai Leaguer Environmental
Protection Co., Ltd. (珠海力合环保有限公司) (water purification plant in the South District).
Gutian Fuxing At the same time when the enterprise started production, the “Three Wastes” were collected
and treated effectively in accordance with the requirements of the “Three Simultaneous” system
of environmental protection. This involves a designed sewage treatment capacity of 1,200 t/
d, adoption of the advanced “Anarerobic-Oxic activated sludge process (A/O) + SBR + nitrogen
removal by denitrification +Fenton decolorizing + air flotation” wastewater treatment process,
6,000 m3 of effective reservoir capacity of the treatment system and more than 20 sets of treatment
equipment with 350 KW installed capacity to improve the water treatment process, thus ensuring
that all wastewater treatment indicators are stable and satisfy the discharge standard. Treated
sewage that reaches the grade II discharge standard is directly charged into Minjiang River. The
hazardous wastes of the company are entrusted to qualified companies for compliant disposal
according to the requirements of environmental impact assessment and acceptance inspection
opinions.
Interim Report 2022 49
Name of company
or subsidiary Construction and operation of pollution preventive facilities
Livzon Limin The “Three Simultaneous” system was strictly implemented by the company for the treatment
of “Three Wastes” by collecting and treating the “Three Wastes” effectively. The investment for
sewage treatment facilities was over RMB13 million with designed processing capacity of 1,500t/d
and adopted the treatment process of “Pre-treatment + Hydrolysis acidification tank + Facultative
tank + Aerobic pool + Secondary sedimentation”, and the sewage after treatment was discharged
through the municipal pipeline network into Shaoguan Second Sewage Treatment Plant (韶关市
第二污水处理厂). In respect of exhaust gas treatment, biomass boilers were all replaced by gas
boilers. The technical transformation project of the R&D center has installed waste gas treatment
facilities such as activated carbon adsorption and acid mist spray tower. In respect of control of
noise pollution, the company built noise segregation walls to reduce noise pollution.
Livzon The “Three Simultaneous” system was strictly implemented by the company for the treatment
Pharmaceutical of “Three Wastes” by collecting and treating the “Three Wastes” effectively. For wastewater: an
Factory investment of over RMB10 million was made for phase I and phase II sewage treatment station
with designed processing capacity of 1,000t/d, which adopted the CASS process for phase I
and the A/O process for phase II, and the sewage after treatment was discharged through the
municipal pipeline network into sewage treatment plants. For waste gas: currently, the company
uses purchased steam and uses the boilers as backups, greatly reducing exhaust gas emissions.
The waste gas of the sewage treatment stations is treated by a combination of first-level spray
towers, Ultra Violet (UV) photoion equipment and second-level spray towers.
Ningxia Through strict enforcement of the “Three Simultaneous” system, the “Three Wastes” were collected
Pharmaceutical and treated effectively. The designed total processing capacity of sewage treatment was 7,500m3/
d (including one plant with capacity of 5,000m3/d and one plant with capacity of 2,500m3/d), and
the actual total treatment amount was 3,100m3/d. After the wastewater had reached the standard
stipulated in the pollutant discharge license, it would be discharged through the sewage pipeline
network in the industrial park to Xin’an Company. In 2021, the installation and use of exhaust gas
collection and treatment facilities for hazardous waste stations were completed, and doramectin
fermentation exhaust gas of 101 fermentation workshop was introduced into the specific exhaust
gas treatment facility for doramectin fermentation exhaust gas of 102 fermentation workshop, and
a primary sedimentation tank was added to the sewage treatment station to lead out exhaust gas
for treatment. Since May 2022, the original exhaust gas treatment facilities of 103-2 fermentation
workshop have been upgraded, mainly by adding a set of process treatment facility known as
“sodium hypochlorite spray absorption+ water spray absorption + dual-phase super oxygen water
+ micro-nano bubble”. With the upgrade undergoing, the facilities are expected to be completed
and put into operation in July 2022.
50 Joincare Pharmaceutical Group Industry Co., Ltd.
Name of company
or subsidiary Construction and operation of pollution preventive facilities
Jiaozuo Hecheng The “Three Wastes” were collected and treated effectively in strict compliance with the “Three
Simultaneous” system. The designed sewage treatment capacity was 3,000t/d, the treatment
process of “hydrolytic acidification tank + anaerobic UASB + aerobic pool + materialized treatment”
was adopted, and the treated wastewater would be discharged through the municipal pipeline
network into the sewage treatment plant of Xiuwu Branch of Kangda Water Co., Ltd. (康达水务有
限公司修武分公司). The sewage treatment facilities were under normal operation with compliant
discharge. For exhaust gas: In 2021, the company replaced the sewage tertiary spray, added a set
of UV photolysis exhaust gas treatment facility for the sewage treatment station and discharged
after meeting the standard; exhaust gases generated from technical process in the production
zone would be collected and treated by adopting two sets of processes of “water spray + active
carbon and -20°C condensation + water spray +active carbon” and then discharged after reaching
the required standard. For solid waste: hazardous solid wastes would be stored in the hazardous
waste station constructed in compliance with the requirements of “Three Protections” (protection
against leaks, erosion and rain) according to the requirements under the (Pilot) Guidelines for
Standardized Management of Hazardous Waste in Henan Province 《河南省危险废物规范化
(
管理工作指南(试行)》) for hazardous wastes. In January 2022, the company entered into a self-
monitoring and automatic monitoring equipment comparison contract with Henan Sino Quality
Testing Technology Co., Ltd (河南中方质量检测技术有限公司) to monitor the discharge outlet
of the company regularly; in the same month, the company entered into a continuous online
water-quality monitoring system maintenance contract with Jiaozuo Lansheng Environmental
Technology Service Co., Ltd. (焦作市蓝晟环保技术服务有限公司), in relation to the provision
of relevant maintenance services to the Company. In April 2022, the company entered into a
hazardous waste disposal agreement with Henan Zhonghuanxin Environmental Technology Co.,
Ltd. (河南中环信环保科技有限公司) for disposal of hazardous wastes on a regular basis. Other
general solid wastes would be disposed of in compliance with the relevant requirements.
Shanghai Livzon The company designed and built a sewage treatment station with a processing capacity of 200m3/d
in 2018. The company’s sewage was treated by such sewage treatment station and then entered
the park’s sewage treatment station for secondary treatment, and finally discharged into the
municipal pipeline network. The company had the hazardous waste station in compliance with the
requirements of “Three Preventions” to store hazardous waste and appointed a qualified company
for compliant disposal. The company’s main exhaust outlets were treated with activated carbon
adsorption and filtration, and the activated carbon was replaced every half a year to ensure that
the exhaust gas emission met the standards. In January 2022, the company demolished the solid
formulation workshop on the third floor and renovated it into a microsphere workshop, so there is
no discharge of particulate matter from the No. 5 and 6 outlets.
Livzon MAB The “Three Simultaneous” system was strictly implemented by the company for the treatment of
“Three Wastes” by collecting and treating the “Three Wastes” effectively. For wastewater (relying on
the wastewater treatment of the pharmaceutical factory in the park): an investment of over RMB10
million was made for phase I and phase II sewage treatment station with designed processing
capacity of 1,000t/d, which adopted the CASS process for phase I and the A/O process for phase
II, and the sewage after treatment was discharged through the municipal pipeline network into
sewage treatment plants. For waste gas: currently, the company uses purchased steam and uses
the boilers as backups, greatly reducing exhaust gas emissions. The waste gas of the sewage
treatment stations is treated by a combination of first-level spray towers, UV photoion equipment
and second-level spray towers.
Interim Report 2022 51
3. Environmental impact assessment of construction projects and other environmental protection administrative licensing
√ Applicable □ N/A
Name of company Environmental impact assessment of construction projects and other environmental
or subsidiary protection administrative licensing
Jiaozuo Joincare The Approval of Environmental Impact Report on New 12T Natural Gas Boiler Project for Jiaozuo
Joincare Pharmaceutical Industry Co., Ltd. (Jiao Huan Shen Ma [2022] No. 2) was granted on 11 May
2022.
Taitai The preparation of Environmental Impact Report Form for two new products, Efinaconazole and
Pharmaceutical Lidocaine Aerosol, is in progress.
Haibin Pharma The pollutant discharge license was changed on March 2022.
Xinxiang Haibin Approval of Environmental Impact Report on 20 Tonnes/Year Meropenem Pharmaceutical
Intermediate Project (Yu Huan Jian [2005] No. 84), Opinions on Environmental Protection
Inspection and Acceptance for 20 Tonnes/Year Meropenem Pharmaceutical Intermediate F9
Project (Yu Huan Bao Yan [2008] No. 89), Approval of Environmental Impact Report on 100
Tonnes/Year Meropenem Pharmaceutical Intermediate Expansion Project (Yu Huan Shen [2014]
No. 564), Independent acceptance of the Approval of Environmental Impact Report on 100
Tonnes/Year Meropenem Pharmaceutical Intermediate Expansion Project on 24 March 2019,
Opinions of Comprehensive Supervision and Enforcement Bureau of High-tech Zone on Approval
of Environmental Impact Report on Technical Center Expansion Project of Xinxiang Haibin
Pharmaceutical Co., Ltd. (Xin Gao Zong Jian Zi [2020] No. 26), and the reply to the Environmental
Impact Assessment Report for the Peinan Series API Development Project of Xinxiang Haibin
Pharmaceutical Co., Ltd (Xin Huan Shu Shen [2021] No. 24).
Fuzhou Fuxing The Environmental Impact Report on the Phase III High-end Antibiotics Project of Livzon Group
Fuzhou Fuxing Pharmaceutical Co., Ltd. was approved on 23 August 2021. The company strictly
implemented the “Three Simultaneous” system and took environmental protection measures
required for environmental assessment, while the environmental protection facilities were under
normal operation. An approval was granted for the application of a new national pollutant
discharge license on 27 December 2017 and the renewal of the national pollutant discharge
license was completed in December 2020. The company has been discharging pollutants in strict
compliance with the licensing and administrative requirements. The Environmental Impact Report
on the Phase IV High-end Antibiotics Project of Livzon Group Fuzhou Fuxing Pharmaceutical Co.,
Ltd. (丽珠集团福州福兴医药有限公司) for this reporting period is under preparation.
Xinbeijiang The Environmental Impact Report on Current Status of Projects of Livzon Group Xinbeijiang
Pharmaceutical Pharmaceutical Manufacturing Inc. 《丽珠集团新北江制药股份有限公司项目现状环境影响
(
报告书》) was approved and filed on 6 December 2016. With strict enforcement of the “Three
Simultaneous” system and implementation of the environmental protection measures required
under the environmental impact assessment, the environmental protection facilities have been
functioning properly. On 29 December 2017, an approval was granted for the application of a
new national pollutant discharge license and the work for changing and renewing the pollutant
discharge license was completed in December 2020. The environmental protection policies were
strictly enforced. On 28 April 2022, the company completed the application for the pollutant
discharge license for Shijiao New Factory. On 16 June 2022, the company completed the
environmental impact assessment of the new plant for the addition of mixed compound veterinary
drugs and obtained the environmental assessment approval (Qingcheng Shen Pi Huan Biao [2022]
No. 12).
52 Joincare Pharmaceutical Group Industry Co., Ltd.
Name of company Environmental impact assessment of construction projects and other environmental
or subsidiary protection administrative licensing
Livzon Hecheng The Environmental Impact Assessment Report on Current Status of the Product Structure
and Production Capacity Adjustment Project of Zhuhai FTZ Livzon Hecheng Pharmaceutical
Manufacturing Co., Ltd. 《珠海保税区丽珠合成制药有限公司产品结构及产能调整项目现状环境
(
影响评价报告》) was approved in December 2016. In 2021, the environmental impact assessment
of 14 new products including paliperidone palmitate (棕榈酸帕利呱酮), aripiprazole (阿立哌唑),
bismuth potassium citrate (枸橼酸铋钾), i.e. the Environmental Impact Assessment Report on
Technological Renovation and Expansion Project of Livzon Synthetic Pharmaceutical Co., Ltd. in
Zhuhai Free Trade Zone 《珠海保税区丽珠合成制药有限公司技改扩建项目环境影响评价报告》),
(
passed expert review and was approved. The company strictly enforced the “Three Simultaneous”
system and implemented environmental protection measures as required under environmental
impact assessment with normal operation of the environmental protection facilities. In 2021,
it was awarded the green card enterprise of environmental credit rating by Zhuhai Municipal
Ecology and Environment Bureau. In March 2022, the company completed the filing of the revised
environmental emergency contingency plan.
Gutian Fuxing The company passed the environmental impact assessment on 30 June 1999 and the inspection
and acceptance upon completion of construction carried out by Environmental Protection Bureau
of Fujian Province on 5 June 2000. The company re-prepared its post-environmental impact
assessment report in 2019 and passed the inspection and acceptance carried out by experts on
11 June 2019. The company strictly enforced the “Three Simultaneous” system and implemented
environmental protection measures as required under environmental impact assessment with
normal operation of the environmental protection facilities.
Livzon Limin The Environmental Impact Report on the Technological Reform Project for the R&D Center
of Livzon Group Limin Pharmaceutical Manufacturing Factory 《丽珠集团利民制药厂研发中
(
心技改项目环境影响报告表》) was approved on 6 December 2019. The expert meeting of
acceptance was held on 24 April 2021, in which the independent acceptance was completed. The
Environmental Impact Report for Workshop II of Small capacity Injection 《小容量注射剂二车间
(
项目环境影响报告表》) was approved on 23 November 2020. On 15 September 2021, the expert
meeting of acceptance was held, in which the independent review was completed. The National
Sewage Permit was updated on 22 October 2021. The “Three Simultaneous” system was strictly
enforced to implement the environmental protection measures required under the environmental
impact assessment, and the environmental protection facilities were under normal operation.
Livzon The Environmental Impact Assessment Report on Expansion Project for Production Line of
Pharmaceutical Recombinant Human Chorionic Gonadotropin for Injection of Livzon Group Livzon Pharmaceutical
Factory Factory (丽珠集团丽珠制药厂) was approved in March 2018. The Environmental Impact
Assessment Report on Expansion Project for Sewage Treatment Stations of Livzon Group Livzon
Pharmaceutical Factory was approved in April 2019. The Environmental Impact Assessment Report
on Expansion Project for Production Line of lyophilized Powder Injection of Livzon Group Livzon
Pharmaceutical Factory was approved in November 2020. The Environmental Impact Report Form
of P07 New Wet Granulation Line Project of Livzon Group Livzon Pharmaceutical Factory was
approved on 18 May 2022. The company obtained an updated sewage permit in June 2022. The
company will strictly enforce the “Three-simultaneous” system to implement the environmental
protection measures as required by environmental assessment.
Interim Report 2022 53
Name of company Environmental impact assessment of construction projects and other environmental
or subsidiary protection administrative licensing
Ningxia The environmental protection inspection for completion of doramectin expansion project
Pharmaceutical was completed in March 2021. In September 2021, expert review and government filing were
completed for the environmental impact evaluation of project work upon optimized disposal of
the company’s solid waste. The company applied to change its pollutant discharge permit and
passed the review of the Pingluo Branch of Shizuishan Municipal Ecology and Environment Bureau
in December 2021. The company strictly enforced the “Three Simultaneous” system to implement
the environmental protection measures as required by environmental assessment, while the
environmental protection facilities were under normal operation.
Jiaozuo Hecheng The Environmental Impact Assessment Report on Current Status of Jiaozuo Livzon Hecheng
Pharmaceutical Manufacturing Co., Ltd. 《焦作丽珠合成制药有限公司现状环境影响评估报
(
告》) was approved and filed on 15 December 2016. The “Three Simultaneous” system was strictly
enforced, the environmental protection measures as required by environmental assessment
were implemented and the environmental protection facilities were under normal operation. The
application for the national pollutant discharge license was completed in December 2020, the
environmental protection policies were strictly enforced and various management measures were
implemented. According to the spirit of the document “Notice of the Office of the Leading Group
of Jiaozuo City’s Pollution Prevention and Control Battle on Doing a Good Job in the Key Work of
Air Pollution Prevention and Control in May 2022”, the company formulated the “one policy for one
enterprise” plan for Jiaozuo Hecheng VOCs emission enterprise in 2022.
Shanghai Livzon The company passed the environmental assessment review of the Leuprorelin Acetate
Microspheres for Injection Industrialization Project 《注射用醋酸亮丙瑞林微球产业化项目》)
(
on 11 October 2010, obtained the approval for the Environmental Impact Report on Supporting
Engineering and Laboratory Projects of Shanghai Livzon Pharmaceutical Manufacturing Co.,
Ltd. 《上海丽珠制药有限公司配套工程及实验室项目环境影响报告》) on 10 January 2020,
(
and completed the construction and passed the acceptance inspection in September 2020.
The company strictly implemented the “Three Simultaneous” system and took environmental
protection measures required for environmental assessment, while the environmental protection
facilities were under normal operation.
Livzon MAB The Environmental Impact Assessment Report on V-01 Industrialization Project of Livzon Group
Livzon Pharmaceutical Factory (丽珠集团丽珠制药厂V-01 产业化项目环境影响报告书) was
approved in April 2021. The Third Line Environmental Impact Report of the Expanded Preparation
of the Large-scale Production Capacity Construction Project of Recombinant SARS-CoV-2 Fusion
Protein Vaccine (V-01) was approved in March 2022. The company obtained an updated sewage
permit in March 2022. The company strictly implemented the “Three Simultaneous” system and
took environmental protection measures required for environmental assessment.
54 Joincare Pharmaceutical Group Industry Co., Ltd.
4. Environmental emergency contingency plan
√ Applicable □ N/A
Name of company
or subsidiary Environmental emergency contingency plan
Jiaozuo Joincare Revision of the environmental emergency contingency plan of Jiaozuo Joincare Pharmaceutical
Industry Co., Ltd. was completed in May 2022 and was filed in the Macun Branch of Ecological
Environment Bureau of Jiaozuo City on 19 May 2022.
Revision of the environmental emergency contingency plan for hazardous waste pollution accident
of Jiaozuo Joincare was completed in December 2020.
Taitai Review and filing was completed in July 2020.
Pharmaceutical
Haibin Pharma The Environmental Emergency Contingency Plan was filed (File No. 440308-2020-0029M). Trainings
and drills on emergency responses were provided for employees to improve the capability of the
Company for dealing with environmental emergencies.
Xinxiang Haibin In July 2022, the environmental emergency contingency plan has passed expert review and is
under filing.
Fuzhou Fuxing Pursuant to relevant provisions and requirements, the Environmental Emergency Contingency Plan
of Livzon Group Fuzhou Fuxing Pharmaceutical Co., Ltd. 《丽珠集团福州福兴医药有限公司突
(
发环境事件应急预案》) was prepared based on the principles of “prevention-oriented, self-help-
oriented, unified command, and division of responsibility”, which has been filed on 15 April 2022
(File No. 350181-2022-024-M).
After environmental emergencies occur, immediate, quick, effective and orderly emergency rescue
actions shall be taken to control and prevent the spread of accident and contamination, protect
the surrounding environment and safeguard life and property of all employees, the company and
nearby communities. In accordance with the contents and requirements of the plan, the company
provides trainings and drills for its employees to get them well-prepared for environmental
emergencies, so that timely rescue can be taken and the accident can be controlled in a short
period of time in case of any environmental emergencies. In May 2022, the second comprehensive
emergency drill for four leakage accidents in the workshop was conducted.
Xinbeijiang Based on the principles of “prevention-oriented, on-alert all the time; classified management, level-
Pharmaceutical by-level response; cross-department cooperation, responsibility by levels; scientific prevention and
efficient handling”, Xinbeijiang Pharmaceutical re-signed and issued the Environmental Emergency
Contingency Plan of Livzon Group Xinbeijiang Pharmaceutical Manufacturing Inc. 《丽珠集团新北
(
江制药股份有限公司突发环境事件应急预案》) (File No. 441802-2021-0162-H) on 30 September
2021, which has been approved and filed by Qingyuan Municipal Ecology and Environment
Bureau on 22 October 2021. Xinbeijiang Pharmaceutical conducted exercises regularly to identify
environmental factors and sources of hazards, as well as drills on the emergency contingency
plan. An environmental emergency contingency drill was conducted in June 2022 to improve
the operability thereof, and enhance the performance of the emergency rescue staff and the
responsiveness and coordination ability of the rescue team.
Livzon Hecheng Pursuant to relevant provisions and requirements, the Environmental Emergency Contingency
Plan of Zhuhai FTZ Livzon Hecheng Pharmaceutical Manufacturing Co., Ltd. 《珠海保税区丽珠
(
合成制药有限公司突发环境事件应急预案》) was prepared based on the principles of “Focus on
Prevention, Aim at Self-rescue, Centralized Command, and Division of Responsibility”, which has
been approved, filed and issued (File No. 440462-2019-001-M). Trainings on emergency response
and handling measures were held regularly for employees to enable implementation of safety
measures in a timely, fast, effective and orderly manner to control and prevent the spread of
accident and contamination when encountering any environmental emergencies, so as to alleviate
or eliminate the impact of the accident and resume production as soon as possible.
Interim Report 2022 55
Name of company
or subsidiary Environmental emergency contingency plan
Gutian Fuxing Pursuant to relevant provisions and requirements, the Environmental Emergency Contingency
Plan of Gutian Fuxing Pharmaceutical Co., Ltd. 《古田福兴医药有限公司突发环境事件应急预
(
案》) was prepared based on the principles of “Focus on Prevention, Aim at Self-rescue, Centralized
Command, and Division of Responsibility”. The contingency plan was approved in May 2017 (File
No. 352200-2017-005-L) and amended in June 2020, and has passed expert review and completed
filing (File No. 350922-2020-002-M).
According to the plan, after environmental emergencies occur, immediate, quick, effective and
orderly emergency rescue actions shall be taken to control and prevent the spread of accident
and contamination, protect the surrounding environment and safeguard life and property of
all employees, the company and nearby communities. In accordance with the content and
requirements of the plan, the company provides trainings for its employees to get them well-
prepared for environmental emergencies, so that timely rescue can be taken and the accident can
be controlled in a short period of time in case of any environmental emergencies.
Livzon Limin The principles of occupational health and safe environment administrative system were followed,
including occupational protection to ensure health, risk control to ensure safety, prevention
and control of pollution to protect the environment, and compliance with discipline and law for
continuous improvement. Identification of environmental factors was performed seriously and
preventive measures were adopted for significant environmental factors, while the governance
of the “Three Wastes” was strengthened to enhance the ability of control over the “Three Wastes”
and ensure that the discharge of the “Three Wastes” had reached the discharge standards. The
Environmental Emergency Contingency Plan of Livzon Group Limin Pharmaceutical Manufacturing
Factory 《丽珠集团利民制药厂突发环境事件应急预案》) was prepared in accordance with
(
the criteria of the environmental management system and the occupational health and safety
administrative system. The plan was issued in May 2021 (File No. 440203-2021-009-L). According to
the contingency plan, an environmental accident emergency drill was conducted on 24 September
2021, and a specific drill summary was made. Identification of environmental factors and sources of
hazards and drills for emergency were conducted internally in the company on a regular basis to
improve the operability of the contingency plan, and enhance the performance of the emergency
rescue staff and the responsiveness and coordination ability of the rescue team.
Livzon Pursuant to relevant provisions, the Environmental Emergency Contingency Plan of Livzon Group
Pharmaceutical Livzon Pharmaceutical Factory 《丽珠集团丽珠制药厂突发环境事件应急预案》) was reformulated
(
Factory by the company in 2021, and has been approved, filed and issued (File No. 440404-2021-0212-
L). The company conducted a fire emergency evacuation drill in the P10 workshop in April 2022
to improve employees’ emergency handling ability and alleviate or eliminate the impact of the
accident.
Ningxia The Environmental Emergency Contingency Plan of Livzon Group (Ningxia) Pharmaceutical
Pharmaceutical Manufacturing Co., Ltd. 《丽珠集团(宁夏)制药有限公司突发环境事件应急预案》) was approved
(
filed and issued in May 2019 (File No. 640221-2019-005-II). Identification of environmental factors
and sources of hazards and drills for emergency were conducted internally in the company on a
regular basis to improve the operability of the contingency plan, and enhance the performance
of the emergency rescue staff and the responsiveness and comprehensive coordination ability
of the rescue team. The Environmental Emergency Contingency Plan was amended in May 2021,
and has passed expert review and the review by and the filing with government environmental
department in August 2021.
56 Joincare Pharmaceutical Group Industry Co., Ltd.
Name of company
or subsidiary Environmental emergency contingency plan
Jiaozuo Hecheng The Environmental Emergency Contingency Plan of Jiaozuo Livzon Hecheng Pharmaceutical
Manufacturing Co., Ltd. 《焦作丽珠合成制药有限公司突发环境事件应急预案》) was prepared
(
in accordance with the relevant provisions and requirements and based on the principles of
“prevention-oriented, on-alert all the time; classified management, level-by-level response; cross-
department cooperation, responsibility by levels; scientific prevention and efficient handling”. The
contingency plan was approved, issued and filed in April 2021 (File No. 4108042018005L). The
Hazardous Waste Environmental Pollution Emergency Contingency Plan of Jiaozuo Livzon Hecheng
Pharmaceutical Manufacturing Co., Ltd. 《焦作丽珠合成制药有限公司危险废物环境污染事故应
(
急预案》) was prepared under the above provisions, requirements and principles as well, which
was approved and filed in January 2018. Identification of environmental factors and sources of
hazards and drills for emergency were conducted internally in the company on a regular basis to
improve the operability of the contingency plan, and enhance the performance of the emergency
rescue staff and the responsiveness and coordination ability of the rescue team. The company
carried out trainings on the Standard Operating Procedure for Acid Mist Purification Towers and
the Standard Operating Procedure for Hazardous Waste Storage Pollutants in April 2021 and June
2021, respectively, according to the relevant requirements of the Hazardous Waste Environmental
Pollution Emergency Contingency Plan of Jiaozuo Livzon Hecheng Pharmaceutical Manufacturing
Co., Ltd. In November 2021, the “Operation Regulations for Exhaust Gas UV Photolysis Equipment”
was added and the “Spray Towers Operation Regulations” was amended, and relevant trainings
were conducted to increase the environmental protection knowledge of staff. In March 2022,
the company amended some environmental protection documents, including “Enterprise
Environmental Information Disclosure System”, “Discharge Permit System” and “Operating
Procedures for Sewage Treatment”.
Shanghai Livzon In March 2022, the company issued and filed the Environmental Emergency Contingency Plan of
Shanghai Livzon Pharmaceutical Manufacturing Co., Ltd. 《上海丽珠制药有限公司突发环境事件
(
应急预案》) (File No. 02-310115-2022-108-L). The company conducts drills and reviews of the plan
every year to improve its emergency response capabilities through such regular trainings.
Livzon MAB Pursuant to relevant provisions, the Environmental Emergency Contingency Plan of Livzon MAB
《丽珠单抗突发环境事件应急预案》) was prepared by the company in 2022. The company
(
conducted an emergency response drill for hazardous chemical leakage in the dangerous goods
warehouse in June 2022 to improve employees’ emergency handling ability and alleviate or
eliminate the impact of the accident.
5. Environmental self-monitoring program
√ Applicable □N/A
Name of company
or subsidiary Environmental self-monitoring program
Jiaozuo Joincare As required by the self-monitoring program for pollutant discharge licenses, Jiaozuo Joincare
developed the 2022 self-monitoring program for wastewater and waste gas and carried out self-
monitoring according to the program. Up to now, Jiaozuo Joincare has completed the self-
monitoring for wastewater and waste gas for the first half year of 2022.
The company is a key enterprise in terms of soil monitoring, and should carry out self-monitoring
of soil once a year as required. Up to now, the company has completed the preparation, review
and on-site sampling of self-monitoring program.
Taitai Wastewater was monitored once a quarter; boiler exhaust gas and plant boundary noise were
Pharmaceutical monitored once a year and exhaust gases generated from technical process was monitored once
half a year.
Interim Report 2022 57
Name of company
or subsidiary Environmental self-monitoring program
Haibin Pharma A third party is entrusted to conduct regular monitoring in compliance with the requirements
of the pollutant discharge licenses and ensure the accuracy, validity and authenticity of the
monitoring data. Online wastewater monitoring equipment was installed and connected
to environmental monitoring stations at municipal and district levels in accordance with
environmental monitoring technical standards to ensure the quality of data transmission.
Xinxiang Haibin A self-monitoring program was prepared, exhaust gas and wastewater were self-monitored
quarterly in accordance with the pollutant discharge license, and the annual self-monitoring of soil
has been completed.
Fuzhou Fuxing According to the relevant requirements of the “Measures for Self-Monitoring and Information
Disclosure by Enterprises subject to Intensive Monitoring and Control of the State (Trial
Implementation) 《国家重点监控企业自行监测及信息公开办法(试行)》)” and the “ Technical
(
Guidelines for Self-Monitoring by Pollution Discharge Enterprises in the Fermentation
Pharmaceutical Industry (HJ882-2017) 《排污单位自行监测技术指南发酵类制药工业(HJ882-
(
2017)》)”, the company has completed the establishment of the self-monitoring program based
on its own situation in a timely manner and made the program available to the public after being
examined by and filed with Fuqing Environment Protection Bureau and Fuzhou Environment
Protection Bureau. The analysis methods of the monitoring program comply with the national
environmental monitoring technical standards and methods; the monitoring and analysis
instruments have been examined and calibrated in strict compliance with the relevant national
requirements; the automated monitoring equipment has been installed in accordance with the
requirements of environmental assessment technical standards, connected to the network of
competent environmental protection authorities and passed the acceptance inspection conducted
by the competent environmental protection authorities. The automated monitoring equipment
was sound, and the monitoring information was accurate, valid and authentic. In June 2022, the
volatile organic matters (VOCs) leak detection and repair (LDAR) work in the first half of the year
was finished. Information publicity website: http://wryfb.fjemc.org.cn
Xinbeijiang According to the relevant requirements of the “Measures for Self-Monitoring and Information
Pharmaceutical Disclosure by Enterprises subject to Intensive Monitoring and Control of the State (Trial
Implementation) 《国家重点监控企业自行监测及信息公开办法(试行)》)”, the company has
(
completed the establishment of the self-monitoring program based on its own situation in a
timely manner and made the program available to the public after being examined by and filed
with Qingyuan Environment Protection Bureau. The analysis methods of the monitoring program
comply with the national environmental monitoring technical standards and methods; the
monitoring and analysis instruments have been examined and calibrated in strict compliance with
the relevant national requirements. The automated monitoring equipment for wastewater (COD,
ammonia nitrogen, pH, flow) and waste gas (non-methane hydrocarbons) has been installed in
accordance with the requirement of environmental assessment technical standards, while online
monitoring equipment has passed the inspection and acceptance of the relevant environmental
protection authorities and the connection between online information and national development
platform and Qingyuan municipal platform has been completed. The automated monitoring
equipment was sound, and the monitoring information was accurate, valid and authentic. A third
party is entrusted to conduct LDAR detection and repair every half year in the workshop using
VOCs in compliance with the specification requirements. The fugitive volatile organic compounds
around the workshop of the first refinery division were monitored every half year, and the
monitoring results met the standard in the first half of 2022.
58 Joincare Pharmaceutical Group Industry Co., Ltd.
Name of company
or subsidiary Environmental self-monitoring program
Livzon Hecheng Through self-monitoring, the requirements under the Technical Standards for Application and
Issuance of Pollutant Discharge License for the Pharmaceutical Industry – Active Pharmaceutical
Ingredient Manufacturing (HJ858.1-2017) 《排污许可证申请与核发技术规范制药工业 － 原料药
(
制造(HJ858.1-2017)》) were strictly implemented, and the verification and calibration of monitoring
analyzing devices were carried out in strict compliance with relevant provisions. Automated
monitoring equipment was installed according to the requirements of technical standards for
environmental detection, while online monitoring equipment for COD, ammonia nitrogen and
pH level and online monitoring equipment for non-methane hydrocarbons were installed and
connected with the national development platform as required.
Gutian Fuxing According to the relevant requirements of the “Measures for Self-Monitoring and Information
Disclosure by Enterprises subject to Intensive Monitoring and Control of the State (Trial
Implementation) 《国家重点监控企业自行监测及信息公开办法(试行)》)”, the company has
(
completed the establishment of the self-monitoring program based on its own situation in
a timely manner and made the program available to the public after being examined by and
filed with Ningde Bureau of Ecology and Environment and Ningde Gutian Bureau of Ecology
and Environment. The analysis methods of the monitoring program comply with the national
environmental monitoring technical standards and methods; the monitoring and analysis
instruments have been examined and calibrated in strict compliance with the relevant national
requirements; the automated monitoring equipment has been installed in accordance with the
requirements of environmental assessment technical standards, connected to the network of
competent environmental protection authorities and passed the acceptance inspection conducted
by the competent environmental protection authorities. The automated monitoring equipment
was sound, and the monitoring information was accurate, valid and authentic. In June 2022, a
qualified third party was engaged to complete volatile organic matter leak detection and repair
(LDAR) and a report was obtained. Information publicity website: http://wryfb.fjemc.org.cn
Livzon Limin An entity with national qualification on inspection was engaged to conduct monitoring strictly
in compliance with the relevant national laws and regulations and standards. In view of its own
specific conditions, the company appointed the inspection party to carry out water pollutant
detection monitoring every quarter, boiler exhaust gas monitoring every month and VOCs exhaust
gas monitoring in R&D center every half year, with every monitoring strictly in compliance with the
relevant national requirements to ensure the accuracy, validity and authenticity of the monitoring
data. The inspection acceptance of the online monitoring equipment for COD, ammonia nitrogen
water quality was completed and it was put into use in January 2021, and the equipment was
monitored every 2 hours. The pollution source sharing data were completed and filed to the
Shaoguan Ecological Environment Bureau on a timely basis, and the relevant data were announced
to the public after being reviewed by Shaoguan Municipal Bureau Ecology and Environment.
Livzon An entity with national qualification on inspection was engaged to conduct monitoring strictly
Pharmaceutical in compliance with the relevant national laws and regulations and standards. In view of its own
Factory specific conditions, the company appointed the inspection party to carry out monitoring on
sewage and waste gas every month, with every monitoring strictly in compliance with the relevant
national requirements to ensure the accuracy, validity and authenticity of the monitoring data. The
installation and commissioning of the online sewage monitoring equipment was completed and it
was put into use at the beginning of 2021.
Interim Report 2022 59
Name of company
or subsidiary Environmental self-monitoring program
Ningxia The company formulated the self-monitoring program for 2021, which was reviewed by and filed
Pharmaceutical with the Ecological Environment Bureau of Shizuishan City. Monthly and quarterly monitoring was
carried out strictly in accordance with the requirements of the program, which focused primarily
on organized exhaust gas emission, exhaust gas emission from boiler, waste water discharge,
underground water, soil, unorganized environmental air monitoring above plant boundary, noise
and recycled water TOC, and volatile organic matter leak detection and repair (LDAR) work was
carried out. The monitoring results would be announced to the public through the System of
National Pollution Sources Monitoring Information Management and Sharing Platform 《全国污染
(
源监测信息管理与共享平台系统》) and the System of Self-monitoring Information Open Platform
for Enterprises in Shizuishan 《石嘴山市企业自行监测信息公开平台系统》). The automated
(
monitoring equipment was connected to the network of the competent environmental protection
authority and passed the inspection conducted by the competent environmental protection
authority. The automated monitoring equipment was sound, and the monitoring information was
accurate, valid and authentic. In the first half of 2021, the RTO exhaust VOCs online monitoring
equipment was installed and put into use, and passed the inspection conducted by the
government in August 2021. Monitoring was carried out in accordance with the requirements of
the program in the first half of 2022.
Jiaozuo Hecheng According to the relevant requirements of the “Measures for Self-Monitoring and Information
Disclosure by the Enterprises subject to Intensive Monitoring and Control of the State (Trial
Implementation) ” 《国家重点监控企业自行监测及信息公开办法 ( 试行 )》 the company
(
implemented and completed the self-monitoring program based on its own specific conditions
in a timely manner and made the program available to the public after being examined by and
filed with relevant competent environmental protection authorities. The analysis methods of the
monitoring program comply with the national environmental monitoring technical standards and
methods; the monitoring and analysis instruments have been examined and calibrated in strict
compliance with the relevant national requirements. Volatile organic matter leakage detection and
repair (LDAR) was completed in June 2022. Equipment and facilities such as solvent pipelines and
flanges in the workshop were detected, and places with leakage were repaired and rectified. The
automated monitoring equipment for sewage has been installed online in accordance with the
requirement of environmental assessment technical standards. The online monitoring equipment
of COD, ammonia nitrogen, pH, flow and total nitrogen was installed, which has been connected
to the national development platform as required. Monthly and quarterly monitoring was carried
out strictly in accordance with the requirements of the self-monitoring program, which focused
primarily on organized exhaust gas emission, waste water discharge, plant boundary unorganized
environmental air and noise.
Shanghai Livzon In accordance with the General Rules for the Self-Monitoring Technical Guidelines for Pollutant
Discharge Units 《排污单位自行监测技术指南总则》) (HJ819-2017) and the relevant requirements
(
(including those on pollution discharge license), the company organized self-monitoring and
information disclosure of the pollutants it has discharged, and formulated the Self-monitoring
Program. In 2022, the company monitored main exhaust gas outlets once a month, common
discharge outlets once half year, noise once every quarter and sewage once a month. The
monitoring items and frequency meet the requirements of the pollutant discharge license.
Livzon MAB Entities with national qualification on inspection were engaged to conduct monitoring strictly in
compliance with the relevant national laws and regulations and standards. By considering its own
specific conditions, the Company appointed the inspection party to carry out regular monitoring
on sewage and waste gas according to the requirements of the implementation plan of the
pollutant discharge permit, each time the monitoring would be conducted strictly in compliance
with the relevant national requirements to ensure the accuracy, validity and authenticity of the
monitoring data.
60 Joincare Pharmaceutical Group Industry Co., Ltd.
6. Administrative penalties imposed for environmental issues during the Reporting Period
□ Applicable√ N/A
7. Other environmental information to be disclosed
□ Applicable√ N/A
(II) Statement on environmental protection measures of companies except for key pollutant discharge units
√ Applicable □N/A
The rest subsidiaries of the Company strictly implemented and obeyed the Environmental Protection Law of the People’s
Republic of China, Cleaner Production Law of the People’s Republic of China and other environmental protection and
safe production laws and regulations. They constantly increased investment in environmental protection, continuously
invested in energy conservation and consumption reduction projects, actively promoted cleaner production, improved
comprehensive utilization efficiency of resources, and reduced and avoided pollutants so as to ensure mental and physical
health of employees and the coordinated and sustainable development of economic, environmental and social benefits.
1. Administrative penalties imposed for environmental issues
□ Applicable√ N/A
2. Refer to other environmental information disclosed by key pollutant discharge units
□ Applicable√ N/A
3. Reason for non-disclosure of other environmental information
□ Applicable√ N/A
(III) Statement on subsequent progress or change in environmental information disclosed during the
Reporting Period
□ Applicable√ N/A
(IV) Relevant information contributing to ecological protection, pollution prevention and control, and
fulfillment of environmental responsibilities
√ Applicable □N/A
Relevant information contributing to ecological protection, pollution prevention and control,
Name of company and fulfillment of environmental responsibilities
Jiaozuo Joincare Detection of hidden hazards in soil was completed
LDAR leak detection and repair was completed in the first half of the year
Update of the Environmental Emergency Contingency Plan was completed
Taitai The low nitrogen burner of the 4T boiler was upgraded
Pharmaceutical
Haibin Pharma The emission concentration of pollutants was reduced through the refined control of the operating
parameters of pollutant treatment facilities
Xinxiang Haibin The Letter of Undertaking for Environmental Protection was submitted by the Company to the
competent authority
Annual LDAR leak detection and repair was completed
Environmental taxes were paid in full and on time
Joincare Haibin All wastewater from production was collected and sent to the wastewater treatment station for
treatment, and then sent back to the cooling tower for reuse, so as to realize “zero” discharge of
wastewater.
Interim Report 2022 61
Relevant information contributing to ecological protection, pollution prevention and control,
Name of company and fulfillment of environmental responsibilities
Fuzhou Fuxing LDAR leak detection and repair was completed in the first half of the year; the amendment
and filing of the Environmental Emergency Contingency Plan was completed; preparation of
“one policy for one enterprise 2.0” and expert review were completed; the application for the
certificate of provincial green factory was in process; the preparation of the “Environmental Impact
Assessment Report on the Phase IV High-end Antibiotics” was in process; in the environmental
credit evaluation completed, the company was rated as an environmentally credible enterprise.
The monthly and quarterly self-monitoring was completed as required.
Xinbeijiang LDAR leak detection and repair was completed; unorganized emission of VOCs was reduced;
Pharmaceutical a series of exhaust gas and noise control and improvement measures, such as connecting the
exhaust gas fan of Workshop II of Refining I to the exhaust gas treatment equipment, were made
to reduce unorganized emission of VOCs; the old biological deodorization tank in the sewage
treatment station was replaced, and 2 new exhaust gas spray towers were introduced; exhaust
gas collection and treatment in the sewage treatment station was upgraded; pollutants in exhaust
gas were degraded efficiently; silencers were installed in the sewage treatment station and on
the exhaust gas vent of Fermentation II to reduce air-flow noise; fermentation II and the first
floor of power freezer room were enclosed with brick wall to diminish the impact of noise on
the surrounding environment; other equipment with much noise in the plant was enclosed with
sound-absorbing cotton board to reduce noise. The self-monitoring plan of the first half year was
completed and the results of wastewater, exhaust gas and noise met the emission standards. A
qualified third party is entrusted to dispose of the waste in compliance with laws and regulations.
Livzon Hecheng LDAR leak detection and repair was completed in the first half of the year; unorganized emission
of organic gas was reduced by 1.105 tonnes; the equipment for RTO exhaust was maintained
regularly to ensure its safe operation and the emission of exhaust gas within the emission
standards; items were washed after the completion of RTO process to reduce sulfur dioxide
emissions and smell; qualified units were entrusted to treat hazardous waste with a compliance
treatment rate of 100%; and tail gas treatment facilities were added at gas collection station by the
QC Testing and Technical Development Department. The self-monitoring program was completed
and environmental responsibilities were fulfilled as required.
Gutian Fuxing LDAR leak detection and repair was completed; cover and sealing were added to sewage
treatment regulating pool; waste gas was collected and treated so as to avoid odor emit; HV frame
was replaced in the sewage treatment workshop; water content of sludge was reduced; total
volume of sludge was reduced; sludge generated was entrusted to qualified units for treatment;
and the entrusted testing of waste water, waste gas, soil and groundwater in 2021 was completed,
with the results showing they all met standards. Hazardous waste was entrusted to qualified
companies for compliant treatment to reduce the risk of environmental pollution.
Livzon Limin Solid preparations and steam equipment in high-capacity workshop were renovated; steam usage
was reduced; locations of different drugs in the overhead cabin and TCM cabin were adjusted;
storage energy consumption of the two cabins was reduced; three idle water pumps of the factory
were used; post-treated waste water was used for watering flowers, trees and grass in the factory
in three lines.
Livzon Installation and debugging of online monitoring equipment were completed; a qualified third
Pharmaceutical party was entrusted to detect waste water and waste gas; compliant treatment of hazardous
Factory wastes was made to reduce the risk of environmental pollution. Environmental impact assessment
was conducted for new workshops as required. The facilities at the waste water treatment station
were renovated to ensure the sewage treatment meets the national standards, and at the same
time, improve the treatment efficiency.
62 Joincare Pharmaceutical Group Industry Co., Ltd.
Relevant information contributing to ecological protection, pollution prevention and control,
Name of company and fulfillment of environmental responsibilities
Ningxia LDAR leak detection and repair was completed; field check of “one policy for one enterprise”
Pharmaceutical for corporate VOCs governance was carried out in cooperation with leaders and experts of the
Municipal Environmental Protection Department; installation of online monitoring equipment
for RTO exhaust and VOCs was completed; installation of treatment facilities for exhaust gas from
hazardous waste stations, primary sedimentation tank at the sewage treatment station and 101
doramectin fermentation workshop, and installation of the dust collection and treatment facilities
for the boiler coal conveying system were completed. The environmental protection inspection
for completion of doramectin expansion project was completed, and the evaluation of project
work upon optimized disposal of the company’s solid waste was carried out. The amendment of
the Environmental Emergency Contingency Plan was completed. The monthly and quarterly self-
monitoring was completed as required.
Jiaozuo Hecheng Automatic construction was carried out; LDAR leak detection and repair was completed; green
development evaluation of the pharmaceutical industry in Henan Province was completed; the
result of being No. 8 in the pharmaceutical industry of Henan Province was achieved; treated
waste gas was replaced to ensure the treatment effect; hazardous waste was entrusted to qualified
units for treatment with a compliance treatment rate of 100%; waste gas was entrusted to qualified
third party for testing; the facilities of the waste water system were entrusted to a qualified
third party for maintenance; the “one policy for one enterprise” as advocated by the Municipal
Environmental Protection Bureau for emergency emission reduction in heavily polluted weather
was implemented.
Shanghai Livzon The company discharged pollutants in strict compliance with standards set out in the pollution
discharge license obtained, developed the annual self-monitoring program for pollution discharge
at the beginning of 2022 and implemented it, and successfully passed the semi-annual and annual
review of corporate pollution discharge by the third party entrusted by government departments.
It also completed the annual report on compliance with the pollution discharge license without
violation of laws and regulations. Meanwhile, the company further strengthened the daily
monitoring of operation of waste gas treatment facilities and waste water treatment stations,
and entrusted a third party to detect the emissions of waste gas and wastewater every month to
ensure the effective operation of equipment and facilities. The company developed the Plan on
Comprehensive VOCs Treatment and Emission Reduction in General Enterprises in accordance
with the Notice on Comprehensive Treatment of Volatile Organic Compounds in Key Industries
in the City issued by Shanghai Ecological Environment Department, and used bromogeramine
(benzalkonium bromide) solution to replace part of ethanol for disinfection, so as to meet the
VOCs emission targets.
Livzon MAB A qualified third party was entrusted to detect waste water and waste gas; compliant treatment of
hazardous wastes was made to reduce the risk of environmental pollution. Environmental impact
assessment was conducted for new workshops as required. Sewage is discharged to the sewage
station of Livzon Pharmaceutical Factory for treatment.
Interim Report 2022 63
(V) Measures for carbon emission reduction and effect during the reporting period
√ Applicable □ N/A
Name of company
or subsidiary Measures for carbon emission reduction and effect during the reporting period
Jiaozuo Joincare 1. The 1# fractional column preheater of the solvent storage tank was upgraded, saving about
200 tonnes of steam per month and about 2,000 tonnes per year, reducing carbon emissions
by about 600 tonnes annually;
2. The structure of the fractional column for distilling isopropanol was adjusted and the number
of distillations was changed, saving 10 tonnes of steam per month and about 120 tonnes per
year, reducing carbon emissions by about 36 tonnes annually;
3. An air suspension blower was replaced, saving 120,000kWh of electricity per year, reducing
carbon emissions by about 60 tonnes.
Taitai 1. Lighting facilities in the park were replaced with “energy-saving lamps” in response to the call
Pharmaceutical of the municipal government, producing prominent energy-saving effect;
2. The high-power motor in the factory was replaced with the efficient energy-saving motor in
accordance with energy-saving requirements of the government and frequency conversion
devices were installed to maximize energy conservation;
3. Low-NOx burner of the 4T boiler was upgraded in response to the call of “Green Shenzhen”;
4. Employees were organized to learn energy conservation knowledge so as to achieve energy
conservation and emission reduction in routine work by turning off lamps and machines
timely.
Haibin Pharma Carbon verification and energy conservation diagnostics were conducted to identify key energy-
consuming equipment, and targeted energy-saving improvements were done thereon to reduce
carbon emissions.
Xinxiang Haibin 1. Centrifugal pumps were replaced with diaphragm pumps during sewage transfer, saving
about 70 kWh of electricity per day and 27,000 kWh per year and reducing carbon emissions
by about 14 tonnes annually;
2. A raw material pre-heater was added to the solvent recovery system, and then mother liquor
raw material can be pre-heated with steam condensate, saving about 12 tonnes of steam per
day and 3,600 tonnes per year and reducing carbon emissions by about 1,080 tonnes annually;
3. The circulating water system used efficient energy-saving pumps to replace the existing
chemical pumps, which is expected to save 774,000 kWh of electricity and reduce carbon
emissions by about 387 tonnes annually.
Joincare Haibin The company purchased energy-saving and power-saving equipment meeting new standards,
developed energy-saving habits and thinking, reduced the use of natural gas in boilers, increased
the frequency of facility maintenance and pipeline inspection, adopted effective heat preservation
measures, and encouraged use of pure electric cars for traveling to save fuel.
Fuzhou Fuxing The company utilized PV power generation to reduce power consumption. Energy-saving
renovation of high energy consumption pumps were carried out, effectively reducing energy
consumption. Old pumps were replaced by ones with high efficiency motors to save energy. The
company vigorously publicized energy conservation and consumption reduction, and called on
employees to promptly turn off lamps, air conditioners and computers in routine work.
64 Joincare Pharmaceutical Group Industry Co., Ltd.
Name of company
or subsidiary Measures for carbon emission reduction and effect during the reporting period
Xinbeijiang The company introduced PV power generation to reduce power consumption. Fans of cooling
Pharmaceutical towers were driven by hydrodynamic kinetic energy rather than motors, achieving the same
cooling effect while reducing power consumption. Boiler soft water was preheated through
running heat of air compressor and boiler inlet temperature was raised, effectively reducing the
consumption of natural gas. Inner wall of MVR equipment was cleaned at regular intervals, making
the evaporation rate of sugar water for MVR equipment increase by approximately 40% so as to
effectively reduce the run time of MVR equipment and greatly reduce power consumption. Old
boilers with high energy consumption and high maintenance costs were replaced with new ones,
reducing the average steam consumption per ton by 1.06 m3 natural gas.
Livzon Hecheng Water cooling units were maintained and renovated so as to use energy in a more reasonable
manner; power consumption for production was saved through a more reasonable production
scheduling of the Production Department; the natural gas was used as the fuel for the canteen and
boiler; the roots fans for sewage treatment at the Environmental Protection Center were replaced
with magnetic levitation fans with a relative energy saving rate of 30%, saving about 107,000 kWh
of power annually. All employees in the factory were called on to save electricity by turning off
lamps and air conditioners after work, and limit the minimum temperature of air conditioners;
green travel was promoted; employees were encouraged to take public transportation for business
trips; commuting buses were provided for employees.
Gutian Fuxing Four sets of 130 m3/min air compressors were installed to replace the previous more power-
consuming ones so as to reduce power consumption; a set of water cooling unit was replaced to
reduce power consumption; all employees were called on to “save every drop of water and every
kilowatt hour” by turning off lamps and shutting down equipment after work.
Livzon Limin In the solid agent workshop, the set values of temperature and humidity of the air conditioning
system were appropriately adjusted (within the reference range) to be as close as possible to
the values of the ambient temperature and humidity to reduce steam consumption; the energy
consumption was reduced by the QC Department through control of the number of compressors
of the air conditioning unit in service and parameter setting, and intermittent use of the biological
test room; the consumption of natural gas is reduced by using the hot tail water generated by
the distilled water machine in the production workshop to heat the soft water of the boiler; the
exhaust devices of the air conditioning system in the R&D center were retrofitted to save power
consumption.
Livzon Incandescent light bulbs were replaced with LED lamps to reduce power consumption. PV inverter
Pharmaceutical cabinets and roof PV modules were renovated, which improved PV power generation efficiency
Factory and could save about 600,000 kWh per year. Outsourced steam was introduced to reduce boiler
combustion and save energy. Functional departments were required to further tighten energy
conservation management, and encourage employees to turn off lights and machines during the
lunch break, or when they leave their post, so as to reduce power consumption. The company also
provided commuting buses for employees.
Ningxia Phenylalanine concentration system was renovated, in which the original triple effect thickening
Pharmaceutical system was replaced with MVR thickening system, thus reducing energy consumption by 50%.
The boiler system was overhauled and maintained regularly so as to ensure efficient operation of
boiler body and desulfurization and dust removal facilities. Consumption of outsourced steam was
increased to reduce coal consumption and carbon emission.
Interim Report 2022 65
Name of company
or subsidiary Measures for carbon emission reduction and effect during the reporting period
Jiaozuo Hecheng Steam condensate was recycled to reduce steam use and carbon emission; the packaging
equipment was changed to automatic packaging to increase production efficiency; energy
conservation and consumption reduction were vigorously publicized in the company; all
employees were called on to “save every drop of water and every kilowatt hour”; workshop paint
was put unified management to avoid waste; a view mirror was added behind the steam trap
valve to observe steam loss; steam condensate was diverted to the production auxiliary system of
the hot water tank and the crystallizing tank for use to reduce steam use; the lights in the public
areas and corridors of workshops were changed to voice-controlled or light-controlled ones
and workshop lighting was gradually replaced with LED lights; and high energy-consumption
equipment and facilities in workshops were gradually replaced with low energy-consumption or
automatic interlocking ones.
Shanghai Livzon The company further strengthened daily energy conservation management according to existing
energy conservation plan, effectively enhanced energy conservation awareness of employees
through inspection and publicity, and encouraged employees to develop the good habit of water
and power conservation. Meanwhile, the company improved more than 10% of peptide yield
by optimizing peptide process so as to reduce power consumption of unit product. The solid
preparation workshop was transformed into a powder injection workshop, which can produce less
waste while saving electricity; the comfort air conditioning unit (refrigeration) uses the cooling
capacity of the water cooling unit in the power room, and the multi-expansion air conditioning
unit is installed outdoors to use air cooling, which can save the cooling capacity and reduce the
energy consumption.
Livzon MAB The outsourced steam was introduced to save energy. The company effectively enhanced
energy conservation awareness of employees through inspection and publicity, and encouraged
employees to develop the good habit of water and power conservation. LED lights were used
to reduce electricity consumption. The company encouraged employees to turn off lights and
machines when they leave their post in order to reduce power consumption. The company also
provided commuting buses for employees.
II Consolidation and expansion of achievements in poverty alleviation and rural
revitalization
√ Applicable □ N/A
1. Industrial revitalization
The Company follows important guiding principles of the CPC Central Committee and the General Secretary. In accordance
with the relevant requirements, we establish and implement the plan of “Revitalization of Astragalus Root (黄芪) Industry”
and adopt the model of “Company + Base” and “Company + Professional Cooperative”, encouraging locals to cultivate
and process astragalus root and develop the astragalus root industry based on the local conditions. Making it a pillar
industry for local economy in the long-term and a new path to improve the lives of the people, the Company explores the
development of the featured astragalus root industry to promote the construction of the “Chinese Medicine Ecological
Base”.
66 Joincare Pharmaceutical Group Industry Co., Ltd.
The “Revitalization of Astragalus Root Industry” program was initiated in 2017 and is still in operation today. Datong Livzon
Qiyuan Medicine Co., Ltd. (大同丽珠芪源药材有限公司) (“Datong Livzon”), a subsidiary of the Company’s controlled
subsidiary Livzon Group, built cultivation bases independently in Hunyuan County of Datong City in Shanxi Province and
Zizhou County of Yulin City in Shaanxi Province. And Datong Livzon cooperated with 12 cooperatives and 3 individuals
to jointly build cultivation bases for astragalus root in Tianzhen County of Datong City and Ying County of Shuozhou City
in Shanxi Province and Yulin City of Shaanxi Province. The total area of the self-built bases and jointly constructed bases
is about 33,000 mu and a total of 265 people have been assisted. This program has effectively boosted the economy of
corresponding areas in Shanxi and Shaanxi.
During the reporting period, the planting area of the self-built base in Hunyuan County of Datong City in Shanxi Province
increased by 300 mu. And the number of newly hired local workers reached 55. In addition, Datong Livzon cooperated
with the village committee of Mazhuang Village, Guaner Township, Hunyuan County, Datong City, Shanxi Province
to initiate the “Joint Construction by Villages and Enterprises” program and built factories in Mazhuang Village for the
preliminary processing of astragalus root.
2. Access to Public Welfare Program for Prevention and Treatment of Chronic Diseases
In order to respond positively to the call of national policies and support consolidation and expansion of achievements
in poverty alleviation and rural revitalization, the Company and its controlled subsidiary Livzon Group have launched
the “Access to Public Welfare for Chronic Diseases Prevention and Treatment (普惠慢病防治公益项目)” program based
on our own industrial advantages, bringing real health benefits to the grass roots. The program targets at hypertension,
hyperlipidemia, cardiovascular and cerebrovascular diseases, and drugs for treatment of chronic diseases have been
donated to remote areas, including Pravastatin Capsules (普伐他汀钠胶囊), Amlodipine Besylate Capsules (苯磺酸氨氯地
平胶囊), Valsartan Capsules (缬沙坦胶囊), and Isosorbide Mononitrate Tablets (单硝酸异山梨酯片), which could be worth
millions of RMB. These drugs can really help families in remote areas, make it convenient for patients in the regions to take
drugs nearby, help the families with patients to alleviate medical pressures, and provide timely assistance. Based on actual
conditions, the program regularly makes continuous drug donations to remote areas and helps the families with patients
in such regions.
Since late 2018 onwards, with the support of local government agencies and relevant authorities at all levels, we have
carried out the “Access to Public Welfare for Chronic Diseases Prevention and Treatment” successively in areas including
Chaotian District of Guangyuan City, Songpan County of the Autonomous Prefecture of Aba Zangs and Qiangs, Jiange
County and Pingwu County in Sichuan Province, Hunyuan County, Guangling County and Lingqiu County of Datong City
in Shanxi Province, Dongxiang County, Tianzhu County, Linze County and Shandan County in Gansu Province, Xianghai
national nature reserve in Jilin Province, Chayu County in Tibet Autonomous Region, Macun District of Jiaozuo City in
Henan Province, Huangshan District of Huangshan City in Anhui Province, Suining County of Hunan Province, and Fenyi
County of Jiangxi Province, bringing benefits to many patients. As at the end of the Reporting Period, the Company has
donated drugs to low-income patients with chronic conditions in the abovementioned regions, which could be worth
millions of RMB.
As of 30 June 2022, a total of 18 agreements for the “Public Welfare Program for Prevention and Treatment of Chronic
Diseases” program were signed to assist 16 underserved remote areas and 1 state-level nature, more than 6,000 low-income
patients with chronic conditions helped. In the second half of 2022, it is planned to donate drugs to areas including Gansu,
Sichuan, Guizhou, Anhui, and Jilin etc.
Major Events
6
68 Joincare Pharmaceutical Group Industry Co., Ltd.
Chapter 6 Major Events
I Fulfillment of undertakings
(I) Undertakings fulfilled during the Reporting Period or not yet fulfilled as of the Reporting Period by the
parties to the commitment such as de facto controllers, shareholders, related parties, acquirers of the
Company and the Company
√ Applicable □ N/A
Specific Next plan
Whether Whether reasons should be
there is commitment for failure stated in case
Time and a time is strictly in timely of failure
Commitment Commitment time limit of limit for fulfilled in fulfillment in timely
background type Subject Commitment content commitment fulfillment time shall be given fulfillment
Commitment Settlement Baiyeyuan Shenzhen Baiyeyuan Investment Co., Ltd., the controlling shareholder of the 30 April 2001, No Yes – –
related to initial of horizontal Company, undertook that it would not be directly or indirectly engaged in long-term
public offering competition or cause subsidiaries and branches under its control to be engaged in any
business or activity constituting horizontal competition with the Company
after the founding of the Company, including but not limited to the research,
production and sales of any products that were the same as or similar to
products under research, production and sales of the Company, and was
willing to undertake compensation responsibility for economic losses to the
Company arising from violation of the said commitment.
Settlement Baiyeyuan, Whereas the domestically listed foreign shares of Livzon Group, a controlled 10 January No Yes – –
of horizon de facto subsidiary of the Company, sought listing on the Main Board of the Stock 2014, long-
competition controllers Exchange of Hong Kong Limited, in order to fully ensure smooth completion term
and persons of the said event and in compliance with relevant requirements of the
acting-in Stock Exchange of Hong Kong Limited, the controlling shareholders, de
concert, and facto controller of the Company and the Company entered into relevant
the Company undertakings with Livzon Group as follows: 1. The controlling shareholders,
de facto controller and persons acting-in-concert of the Company, the
Company and its controlled subsidiaries except for Livzon Group did
not or would not be, directly or indirectly, engaged in any business that
constituted competitive relation or potential competitive relation with
drug research, development, production and sale businesses (“Restricted
Businesses”) of Livzon Group from time to time. For the avoidance of
doubt, the scope of Restricted Businesses did not cover products that were
researched, developed, manufactured and sold on the date of relevant
letter of undertaking by the controlling shareholders and de facto controller
of the Company, the Company and its controlled subsidiaries except for
Livzon Group; 2. If any new business opportunity was found to constitute
competitive relation with Restricted Businesses, the controlling shareholders,
de facto controllers and persons acting-in-concert of the Company, the
Company and its controlling subsidiaries except for Livzon Group would
inform Livzon Group in written form immediately and firstly provide Livzon
Group with the business opportunity in accordance with reasonable and
fair terms and conditions. If Livzon Group gave up the business opportunity,
the controlling shareholders and de facto controllers of the Company, the
Company and its controlled subsidiaries except for Livzon Group may accept
the business opportunity in accordance with the terms and conditions that
were not superior to those offered to Livzon Group; 3. If assets and businesses
that directly or indirectly constituted competitive relation and potential
Interim Report 2022 69
Specific Next plan
Whether Whether reasons should be
there is commitment for failure stated in case
Time and a time is strictly in timely of failure
Commitment Commitment time limit of limit for fulfilled in fulfillment in timely
background type Subject Commitment content commitment fulfillment time shall be given fulfillment
competitive relation with Restricted Businesses were intended to be
transferred, sold, leased, licensed to use or otherwise transferred or allowed
to use (these Sales and Transfers), the controlling shareholders and de facto
controllers of the Company, the Company and its controlled subsidiaries
except for Livzon Group would provide the right of first refusal for Livzon
Group under the same condition. If Livzon Group gave up the right of first
refusal, the controlling shareholders, de facto controllers and persons acting-
in-concert of the Company, the Company and its controlled subsidiaries
except for Livzon Group would carry out these Sales and Transfers to a
third party in accordance with main terms that were not superior to those
offered to Livzon Group; 4. The controlling shareholders, de facto controllers
and persons acting-in-concert of the Company, the Company and its
controlled subsidiaries except for Livzon Group would not be engaged in or
involved in any business that might damage the interests of Livzon Group
and other shareholders through the relation with shareholders of Livzon
Group or the identity of shareholders of Livzon Group; 5. The controlling
shareholders, de facto controllers and persons acting-in-concert of the
Company, the Company and its controlled subsidiaries except for Livzon
Group would not or cause its contact persons (except for Livzon Group) to
directly or indirectly: (1) induce or attempt to induce any director, senior
management or consultant of any member of Livzon Group to terminate
his/her employment with or to be an employee or consultant of Livzon
Group at any time (whichever is applicable), no matter if relevant acts of the
person were against the Employment Contract or Consultancy Agreement
(if applicable); (2) Within three years after any person terminated to be the
director, senior management or consultant of any member of Livzon Group,
employ the person who had or might have any confidentiality information or
business secret in relation to Restricted Businesses (except for the director,
senior management or consultant of the Company and/or its controlling
subsidiaries except for Livzon Group on the date of issuance of relevant letter
of undertaking); (3) Recruit or lobby any person carrying out business in any
member of Livzon Group, accept orders, or carry out business separately,
through any other person or as any person, firm, or manager, advisor,
consultant, employee, agent or shareholder of any company (competitor
of any member of Livzon Group), or lobby or persuade the person making
transaction with Livzon Group or negotiating with Livzon Group on Restricted
Businesses to terminate its transaction with Livzon Group or reduce its normal
business volume with Livzon Group, or ask for more favorable transaction
terms to any member of Livzon Group. 6. The controlling shareholders,
de facto controllers and persons acting-in-concert of the Company, the
Company and its controlled subsidiaries except for Livzon Group further
undertook that: (1) They would allow and cause relevant contact persons
(except for Livzon Group) to allow independent directors of Livzon Group to
review if the Company and its controlled subsidiaries except for Livzon Group
obeyed the Letter of Undertaking at least once a year; (2) They would provide
all the data required for annual review and implementation of the Letter
of Undertaking for independent directors of Livzon Group; (3) They would
allow Livzon Group to disclose the decision on whether the controlling
shareholders and de facto controllers of the Company, the Company and its
controlled subsidiaries except for Livzon Group obeyed and implemented
the Letter of Undertaking reviewed by independent directors of Livzon
Group through the annual report or announcement; (4) The controlling
shareholders, de facto controllers and persons acting-in-concert of
70 Joincare Pharmaceutical Group Industry Co., Ltd.
Specific Next plan
Whether Whether reasons should be
there is commitment for failure stated in case
Time and a time is strictly in timely of failure
Commitment Commitment time limit of limit for fulfilled in fulfillment in timely
background type Subject Commitment content commitment fulfillment time shall be given fulfillment
the Company, the Company (and its controlled subsidiaries except for Livzon
Group) would provide Livzon Group with the Letter of Confirmation in
relation to compliance with clauses of the Letter of Undertaking every year
so as to be included in the annual report of Livzon Group. 7. The controlling
shareholders, de facto controllers and persons acting-in-concert of the
Company, and the Company undertake that they would bear corresponding
legal responsibility and consequence arising from violation of any clause
relevant letter of undertaking from the date of issuance thereof by the
Company (or the Company’s controlled subsidiaries except for Livzon Group
or its contact persons). 8. The said undertakings would terminate in case
of the following circumstances (whichever is earlier): (1) The controlling
shareholders, de facto controllers and persons acting-in-concert of the
Company, the Company and any of its controlled subsidiaries were not
the controlling shareholders of Livzon Group anymore; (2) Livzon Group
terminated the listing of its shares on the Hong Kong Stock Exchange and
other overseas stock exchanges (except that shares of Livzon Group stopped
to be traded temporarily for any reason).
Commitment Others The Company Do not interfere in the operation and management activities of Livzon Group From 8 March Yes Yes – –
related to and de facto or encroach on the interests of Livzon Group 2016 to
seasoned controllers the date of
offerings completion
of remedial
measures in
connection
with the
non-public
offering of
Livzon Group
Others Baiyeyuan and Pursuant to the Guiding Opinions on Matters Relating to the Dilution of From 11 Yes Yes – –
the de facto Current Returns As a Result of Initial Public Offering, Refinancing and Major May 2017 to
controller Asset Restructuring (Announcement of CSRC [2015] No. 31), the company the date of
shall undertake to adopt specific remedial measures relating to dilution of completion
current returns as a result of the company’s initial public offering, refinancing of remedial
of the listed company, or major asset restructuring and shall fulfill such measures in
undertaking. Pursuant to relevant provisions of CSRC, Zhu Baoguo, the de connection
facto controller of Shenzhen Baiyeyuan Investment Co., Ltd., a controlling with rights
shareholder:1. Do not intervene in the operation and management activities issue of
or encroach on the interests of the company; 2. If CSRC issued other new Joincare
regulatory provisions on the remedial measures in relation to returns and
the relevant undertakings and the aforesaid undertakings did not conform
to such provisions from the date of issuance of the undertaking to the
completion of IPO share allotment, the Company/the de facto controller
would undertake to issue a supplemental undertaking in accordance with the
latest provisions of CSRC; 3. The Company/the de facto controller undertook
to practically take the remedial measures in relation to returns formulated by
the company and fulfill the undertaking concerning the remedial measures.
In case of violation of the undertaking, causing losses to the company
or investors, the Company/the de facto controller was willing to assume
compensation responsibilities to the company or investors in accordance
with law. In case of violation of the said undertakings or rejection to fulfill
the said undertakings, as one of the liability subjects relating to the remedial
measures concerning returns, it was agreed that relevant punishment shall
be imposed on or relevant management measures shall be taken against the
Company/the de facto controller by CSRC, the Shanghai Stock Exchange and
other securities regulators in accordance with relevant provisions and rules
set or issued by them.
Interim Report 2022 71
Specific Next plan
Whether Whether reasons should be
there is commitment for failure stated in case
Time and a time is strictly in timely of failure
Commitment Commitment time limit of limit for fulfilled in fulfillment in timely
background type Subject Commitment content commitment fulfillment time shall be given fulfillment
Others The Company After the proceeds for issuance of allotment were in place, the Company From the date Yes Yes – –
would use them according to the disclosure in the announcement, and of proceeds
carry out the policies, including deposit in special account, approval by for issuance
specially-assigned person, and special use of special funds in accordance of the Rights
with management measures for proceeds of the Company. The Board of issue in place
the Company would regularly check the progress of projects invested with to the date of
proceeds, issue a special report on deposit and use of proceeds, engage an completion
accounting firm during the annual audit to issue an verification report on of use of
deposit and use of proceeds, would be supervised by regulators and sponsors proceeds
at any time, and would not make major investment, asset purchase or similar
financial investment though proceeds in disguise.
Other Others The Company 1. While transferring tradable shares subject to selling restrictions held by the 17 December No Yes – –
company in Livzon Group, the company shall strict obey relevant provisions 2008, long-
commitments
of Guidelines of Listed Companies on Transfer of Stock Shares Subject to term
made to the Selling Restrictions ([2008] No. 15); 2. If the Company had shares subject to
medium selling restrictions held by it in Livzon Group that were planned to be sold
and small through the bid trading system of Shenzhen Stock Exchange and reduced
shareholders of more than 5% shares within six months from the first share reduction, the
Company would pass the Announcement on Sales disclosed by Livzon Group
the company
within two trading days before the first share reduction.
II Non-operating use of funds by the controlling shareholder and their related
parties during the reporting period
□ Applicable√ N/A
III Information on Illegal guarantees
□ Applicable√ N/A
IV Audit of interim report
□ Applicable√ N/A
V Information on changes and handling of matters related to non-standard audit
opinions in the annual report for the previous year
□ Applicable√ N/A
VI Matters related to bankruptcy reorganization
□ Applicable√ N/A
VII Material Litigation and Arbitration Matters
□During the Reporting Period, the Company had material litigation and arbitration matters.
√ During the Reporting Period, the Company did not have any material litigation or arbitration matters.
VIII Information on punishment and rectification of the listed company and its
directors, supervisors, senior management, controlling shareholders, and de facto
controllers due to violations of laws and regulations
□ Applicable√ N/A
72 Joincare Pharmaceutical Group Industry Co., Ltd.
IX Integrity of the Company and its controlling shareholders and de facto controllers
during the Reporting Period
□ Applicable√ N/A
X Substantial related party transactions
(I) Related party transactions in the ordinary course of business
1. Provisional Announcements without progress or change in subsequent implementation
√ Applicable □ N/A
Overview Query index
Pursuant to the “Resolution on Related Party Transactions in See the Announcement on Resolutions Considered and
the Ordinary Course of Business of the Controlling Subsidiaries Approved at the 9th Meeting of the 8th Session of the
of Jiaozuo Joincare and Jinguan Electric Power” considered Board of Joincare Pharmaceutical Group Industry Co.,
and approved at the ninth Meeting of the 8th Session of Ltd. (Lin 2022-026) and the Announcement of Joincare
the Board on 29 March 2022, Jiaozuo Joincare intended to Pharmaceutical Group Industry Co., Ltd. on the Related
purchase no more than RMB270 million (inclusive) of steam Party Transactions in the Ordinary Course of Business
and power from Jinguan Electric Power in 2022 so as to of the Controlled Subsidiaries of Jiaozuo Joincare and
satisfy the demands of Jiaozuo Joincare for steam and power Jinguan Electric Power (Lin 2022-032) disclosed by the
in the process of production and operation. The independent Company on China Securities Journal, Securities Times,
directors of the Company gave prior approval opinions on Securities Daily, Shanghai Securities News and the
the Resolution and gave opinions on the approval at the website of Shanghai Stock Exchange ( www.sse.com.cn)
Board meeting. Both parties referred to the market price to on 31 March 2022 for details.
fix a price of the said related party transactions. During the
Reporting Period, the actual amount of the said related party
transactions was RMB129.0814 million.
2. Matters that have been disclosed in the provisional announcements with progress or change in subsequent
implementation
□ Applicable√ N/A
3. Matters that have not been disclosed in the provisional announcements
□ Applicable√ N/A
(II) Related party transactions relating to assets or equity acquisition and sale
1. Matters that have been disclosed in the provisional announcements without progress or change in subsequent
implementation
□ Applicable√ N/A
2. Matters that have been disclosed in the provisional announcements with progress or change in subsequent
implementation
□ Applicable√ N/A
3. Matters that have not been disclosed in the provisional announcements
□ Applicable√ N/A
4. In case of performance agreement, information on performance realization during the Reporting Period shall be disclosed
□ Applicable√ N/A
Interim Report 2022 73
(III) Substantial related party transactions of joint outbound investment
1. Matters that have been disclosed in the provisional announcements without progress or change in subsequent
implementation
□ Applicable√ N/A
2. Matters that have been disclosed in the provisional announcements with progress or change in subsequent
implementation
□ Applicable√ N/A
3. Matters that have not been disclosed in the Provisional Announcements
□ Applicable√ N/A
(IV) Credits and debts with related parties
1. Matters that have been disclosed in the provisional announcements without progress or change in subsequent
implementation
□ Applicable√ N/A
2. Matters that have been disclosed in the provisional announcements with progress or change in subsequent
implementation
□ Applicable√ N/A
3. Matters that have not been disclosed in the provisional announcements
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Provision of funds for the listed company by
Relationship Provision of funds for related party related party
with Balance at Balance at Balance at Balance at
related the beginning Amount the end the beginning Amount the end
Related party party of the period changed of the period of the period changed of the period
Guangdong Blue Treasure Pharmaceutical Co., Ltd.
(广东蓝宝制药有限公司) Others 25,653,956.55 –18,746,863.87 6,907,092.68 379,960.00 20,737,717.33 21,117,677.33
Zhuhai Sanmed Gene Diagnostics Co., Ltd. (珠海市
圣美基因检测科技有限公司) Others 229,288.83 –124,433.99 104,854.84
Sichuan Healthy Deer Hospital Management Co.,
Ltd. and its subsidiaries (四川健康阿鹿医院管理有
限公司及其子公司) Others 337,395.02 234,361.68 571,756.70 8,936.17 32,668,386.45 32,677,322.62
Zhuhai Sanmed Biotech Inc. (珠海圣美生物诊断技
术有限公司) Others 211,200.00 58,955.40 270,155.40
Shenzhen Youbao Technology Co., Ltd. (深圳市有
宝科技有限公司) Others 154,500.00 311,100.00 465,600.00
Zhongshan Renhe Health Products Co., Ltd. (中山市
仁和保健品有限公司) Others 469,895.78 0.00 469,895.78
Shenzhen Jiekang Health Care Co., Ltd. (深圳市捷康
保健有限公司) Others 18,577,246.63 –18,577,246.63 0.00
Shenzhen Healthy Deer Information Technology Co.,
Ltd. (深圳市健康阿鹿信息科技有限公司) Others 4,680.00 –4,680.00 0.00
Total 45,638,162.81 –36,848,807.41 8,789,355.40 388,896.17 53,406,103.78 53,794,999.95
Reason for occurrence of credits and debts with related parties During the Reporting Period, the Company had normal operating fund transactions with related parties
Effect of credits and debts with related parties on the operating The said credits and debts with related parties are operating fund transactions; there was no non-operating use of
results and financial position of the Company funds of the Company by shareholders and related parties
74 Joincare Pharmaceutical Group Industry Co., Ltd.
(V) Financial businesses among the Company, related financial companies, financial companies controlled by
the Company, and related parties
□ Applicable√ N/A
(VI) Other substantial related party transactions
□ Applicable√ N/A
(VII) Others
□ Applicable√ N/A
XI Material contracts and their enforcement
1. Custody, contracting and leasing
□ Applicable√ N/A
2. Major guarantees that have been performed and outstanding during the Reporting Period
√ Applicable □ N/A
Unit: 10,000 Yuan Currency: RMB
External guarantees of the Company (excluding guarantees to its subsidiaries)
Relationship
between the Date of Guaranteed
Guarantor guarantee Whether for a
and the (date of Guarantee there’s a related
listed Secured Amount of signature of Guarantee Maturity Guarantee Fulfilled Overdue Overdue counter- party
Guarantor company party guarantee agreement) Start date date type or not or no amount guarantee or not Relationship
Joincare Headquarter of Jinguan 4,000 2021/7/8 2021/7/8 2022/7/8 Joint liability No No 0 Yes Yes Associated
the Company Electric Power guarantee company
Joincare Headquarter of Jinguan 5,000 2021/7/14 2021/7/14 2022/7/14 Joint liability No No 0 Yes Yes Associated
the Company Electric Power guarantee company
Joincare Headquarter of Jinguan 3,000 2021/8/12 2021/8/12 2022/8/12 Joint liability No No 0 Yes Yes Associated
the Company Electric Power guarantee company
Joincare Headquarter of Jinguan 3,200 2021/9/23 2021/9/23 2022/9/22 Joint liability No No 0 Yes Yes Associated
the Company Electric Power guarantee company
Joincare Headquarter of Jinguan 3,200 2021/10/11 2021/10/11 2022/10/11 Joint liability No No 0 Yes Yes Associated
the Company Electric Power guarantee company
Joincare Headquarter of Jinguan 3,800 2021/10/13 2021/10/13 2022/10/12 Joint liability No No 0 Yes Yes Associated
the Company Electric Power guarantee company
Joincare Headquarter of Jinguan 3,840 2022/2/14 2022/2/14 2022/11/30 Joint liability No No 0 Yes Yes Associated
the Company Electric Power guarantee company
Joincare Headquarter of Jinguan 4,960 2022/2/24 2022/2/24 2022/12/26 Joint liability No No 0 Yes Yes Associated
the Company Electric Power guarantee company
Jiaozuo Wholly-owned Jinguan 2,000 2022/3/28 2022/3/28 2022/12/13 Joint liability No No 0 Yes Yes Associated
Joincare subsidiary Electric Power guarantee company
Joincare Headquarter of Jinguan 3,000 2022/6/8 2022/6/8 2023/6/8 Joint liability No No 0 Yes Yes Associated
the Company Electric Power guarantee company
Joincare Headquarter of Jinguan 3,000 2022/6/22 2022/6/22 2023/6/22 Joint liability No No 0 Yes Yes Associated
the Company Electric Power guarantee company
Total guaranteed amount occurred during the Reporting Period (excluding guarantees to subsidiaries) 16,800.00
Total guaranteed amount as of the end of the Reporting Period (A) (excluding guarantees to subsidiaries) 39,000.00
Interim Report 2022 75
Guarantee provided by the Company and its subsidiaries to subsidiaries
Total amount of guarantees to subsidiaries during the Reporting Period 231,947.82
Total amount of guarantees to subsidiaries as of the end of the Reporting Period (B) 227,478.75
Total guaranteed amount of the Company (including guarantees to subsidiaries)
Total guaranteed amount (A+B) 266,478.75
Percentage of total guaranteed amount in the Company’s net assets (%) 13.26
In which:
Amount of guarantees provided to shareholders, de facto controllers and their related parties (C) 0
Amount of debt guarantee directly or indirectly provided to a guaranteed party with an asset-liability 180,879.39
ratio exceeding 70% (D)
Portion of total guaranteed amount exceeding 50% of net assets (E) 0
Total guaranteed amount of the above three items (C+D+E) 180,879.39
Statement on the contingent joint liability that might be assumed in connection with outstanding guarantee N/A
Statement on guarantees See X 5(4) Related party guarantees in the notes to financial statements for the said related party guarantees
in details
3. Other material contracts
□ Applicable√ N/A
XII Explanation of other significant events
√ Applicable □ N/A
1. Use of proceeds
Pursuant to the Reply to the Approval of Share Allotment of Joincare Pharmaceutical Group Industry Co., Ltd. issued by
CSRC (Zheng Jian Xu Ke [2018] No.1284), the Company allotted 365,105,066 shares to original shareholders. The amount
of expect proceeds for the allotment was RMB2,000,000,000 and the total amount of actual proceeds for the allotment
was RMB1,715,993,800; the deducted distribution expenses were RMB46,253,600; the net amount of proceeds was
RMB1,669,740,200. As at 16 October 2018, the said proceeds were in place and validated by the Capital Verification Report
of Joincare Pharmaceutical Group Industry Co., Ltd. issued by Ruihua Certified Public Accountants (Rui Hua Yan Zi [2018]
No.40060006).
(1) Temporary Replenishment of Working Capital with Proceeds
Pursuant to the Resolution on the Temporary Replenishment of Working Capital with Idle Proceeds considered and
approved at the 7th Meeting of the 8th Session of the Board of the Company on 30 December 2021, it was agreed that the
Company temporarily replenished the working capital with no more than RMB700 million of idle proceeds from 1 January
2022 to 31 December 2022 so as to improve the use efficiency of proceeds and reduce financial expenses of the Company.
For details, please refer to the Announcement of Joincare Pharmaceutical Group Industry Co., Ltd. on the Temporary
Replenishment of Working Capital with Certain Idle Proceeds (Lin 2021-159).
As of 30 June 2022, the balance for temporary replenishment of working capital with idle proceeds of the Company was
RMB700 million.
(2) The Alteration of the Projects Invested with Proceeds
Pursuant to the “Resolution on Change of Certain Projects Invested with Proceeds” considered and approved at the 8th
Meeting of the 8th Session of the Board of the Company on 24 January 2022, it was agreed that Zhuhai Health Industry
Base Construction Project was changed to the New Product R&D Project, Haibin Pharma Pingshan Pharmaceutical
Industrialization Base Expansion Project and the Information Platform Construction Project. The resolution was approved at
the 2022 1st extraordinary general meeting of the Company on 11 February 2022.
76 Joincare Pharmaceutical Group Industry Co., Ltd.
Before this alteration, the projects invested with proceeds for the allotment is as follows:
Unit: 10,000 Yuan
Total amount Use of proceeds Balance of
Total amount of proceeds as at proceeds as at
Project name of investment investment 31 December 2021 31 December 2021
Zhuhai Health Industry Base Construction
Project (珠海大健康产业基地建设项目) 98,066.84 76,974.02 3,386.29 73,587.73
Haibin Pharma Pingshan Pharmaceutical
Industrialization Base Project (海滨制药坪
山医药产业化基地项目) 125,471.35 90,000.00 66,745.58 23,254.42
Total 223,538.19 166,974.02 70,131.87 96,842.15
Given the facts that the “Zhuhai Health Industry Base Construction Project” has been postponed for several times for not
meeting the conditions for commencement, and the market environment and the Company’s business situation have
changed, which resulted in changes in the project feasibility, that the Company has an urgent need of funds for R&D
investment and other projects, and that other financing channels are time-consuming and costly, the Company changed
the aforementioned project to the New Product R&D Project, Haibin Pharma Pingshan Pharmaceutical Industrialization
Base Expansion Project and the Information Platform Construction Project. See below for details:
Unit: 10,000 Yuan
Before alteration After alteration
Total Total
Total amount of Total amount of
amount of proceeds amount of proceeds
Project name investment investment Project name investment investment
Zhuhai Health Industry Base
Construction Project (珠海 New Product R&D Project
大健康产业基地建设项目) 98,066.84 76,974.02 (新产品研发项目) 110,000.00 54,587.73
Haibin Pharma Pingshan
Pharmaceutical Industrialization Base
Expansion Project (海滨制药坪山医
药产业化基地扩建项目) 18,139.39 16,000.00
The Information Platform
Construction Project
(信息化平台建设项目) 3,000.00 3,000.00
Total 98,066.84 76,974.02 Total 131,139.39 73,587.73
Interim Report 2022 77
The details of alteration of the projects invested as follows:
a The New Product R&D Project
The total investment amount of the project is RMB1,100,000,000, in which RMB545,877,300 is raised, mainly for the
research and development of inhalation formulations, complex injections, and new drug delivery devices among others.
In particular, the investment is used for acquiring R&D equipment, pre-clinical and clinical R&D inputs. Main products
involved in this project are: 1) Respiratory drugs: the main purpose of the project as a part of the Company’s strategic
layout in the respiratory drug market, in a bid to increase sources of profit and enhance the Company’s comprehensive
competitiveness in the pharmaceutical market; 2) Complex injections: mainly micronano injections. The Company has built
a complex injection technology development platform, specializing in the development of special injection products such
as nanocrystals, microcrystals, liposomes and emulsions. The micronano formulations proposed with this platform will be
developed based on existing drugs with exact clinical value to further expand the clinical use of the drug; 3) New drug
delivery devices: to be developed based on the progress of R&D of drugs for respiratory diseases, so as to improve the
industrial chain of core products, and enhance the added value and core competitiveness of products to be marketed.
b Haibin Pharma Pingshan Pharmaceutical Industrialization Base Expansion Project
The total investment amount of this project is RMB181,393,900, in which RMB160,000,000 is raised. Based on the
Haibin Pharma Pingshan Pharmaceutical Industrialization Base Project, this project established new production lines of
Tobramycin Solution for Inhalation, Fluticasone Propionate Suspension for Inhalation, among others and expanded existing
production lines of Budesonide Suspension for Inhalation and Levosalbutamol Hydrochloride Nebuliser Solution. This
project is implemented for two key reasons: 1) New products are to be marketed, which requires related production lines.
With inhalation formulations incorporated in its key layout in recent years, the Company has continuously invested in the
R&D of several new products with high clinical value and broad market space. As new products like Tobramycin Inhalation
Solution and Fluticasone Propionate Suspension for Inhalation are to be marketed, related production lines are necessary
to make preparation for commercial production. 2) The capacity is unable to meet demand of some products: Budesonide
Suspension for Inhalation was involved in the fifth batch of national volume-based drug procurement in June 2021,
and will be supplied to public hospitals in 7 domestic provinces, meeting 70% of the drug needs according to policies.
Levosalbutamol Hydrochloride Nebuliser Solution is the first approved exclusive generic drug in China. As of the date of
the adoption of this proposal (January 24, 2022), no originator manufacturers or other generic drug manufacturers have
been approved for market in China. However, the market demand is huge. The original capacity of the above two products
is unable to meet such market demand, making capacity expansion a must.
c The Information Platform Construction Project
The total investment amount of this project is RMB30,000,000, in which RMB30,000,000 is raised. The investment is used
to purchase information management software and hardware as well as computer room facilities. The project planned to
upgrade and improve: (1) the information infrastructure of existing information management system, including disaster
recovery and infrastructure of the server, and security equipment; (2) financial management system, including financial
sharing system and tax administration system; (3) group management and control system, including HR system and SAP
system.
For details of the changes in the above-mentioned projects invested with proceeds, please refer to the Announcement of
Joincare Pharmaceutical Group Industry Co., Ltd. on Change of Certain Projects Invested with Proceeds (Lin 2022-007).
78 Joincare Pharmaceutical Group Industry Co., Ltd.
In addition, as a result of the changes in the above-mentioned projects invested with proceeds, the Company, Taitai
Pharmaceutical, Haibin Pharma, Joincare Haibin, wholly-owned subsidiaries of the Company, together with Minsheng
Securities Co., Ltd. and Shenzhen Branch of China Merchants Bank Co., Ltd. Shenzhen Bagualing Sub-branch of Industrial
Bank Co., Ltd., Shenzhen Hongwei Sub-branch of Industrial and Commercial Bank of China Limited and Shenzhen
University City Sub-branch of China Everbright Bank Co., Ltd. signed a tripartite supervision agreement in relation to
deposits in the Special Account for Proceeds. For details, please refer to the Announcement of Joincare Pharmaceutical
Group Industry Co., Ltd. on Signing A Tripartite Supervision Agreement in Relation to Deposits in the Special Account for
Proceeds (Lin 2022-015).
As a result of the changes in the above-mentioned projects invested with proceeds, the special account for the proceeds
(account number: 4000029129200529625) related to Zhuhai Health Industry Base Construction Project, the original projects
invested with proceeds, has been cancelled. A tripartite supervision agreement in relation to deposits in the Special
Account for Proceeds signed by the Company, Health Pharmaceutical (a wholly-owned subsidiary of the Company) and
Minsheng Securities Co., Ltd. and Shenzhen Hongwei Sub-branch of Industrial and Commercial Bank of China Limited on
the Special Account for Proceeds was terminated accordingly. For details, please refer to the Announcement of Joincare
Pharmaceutical Group Industry Co., Ltd. on Completion of Cancellation of the Special Account for the Proceeds (Lin
2022-016).
As at 30 June 2022, the projects invested with proceeds were as follows:
Unit: 10,000 Yuan
Total amount Use of proceeds Balance of
Total amount of proceeds as at 30 June proceeds as at
Project name of investment invested 2022 30 June 2022
Zhuhai Health Industry Base Construction
Project
(珠海大健康产业基地建设项目) – 3,386.29 3,386.29 –
Haibin Pharma Pingshan Pharmaceutical
Industrialization Base Project(海滨制药坪
山医药产业化基地项目) 125,471.35 90,000.00 77,520.60 12,479.40
New Product R&D Project
(新产品研发项目) 110,000.00 54,587.73 3,041.30 51,546.43
Haibin Pharma Pingshan Pharmaceutical
Industrialization Base Expansion Project
(海滨制药坪山医药产业化基地扩建项目) 18,139.39 16,000.00 4,088.05 11,911.95
The Information Platform Construction
Project (信息化平台建设项目) 3,000.00 3,000.00 195.61 2,804.39
Total 256,610.74 166,974.02 88,231.85 78,742.17
Note: The above-mentioned Zhuhai Health Industry Base Construction Project was terminated.
For details of deposit and actual use of proceeds for the six months ended on 30 June 2022, please refer to the Special
Report of Joincare Pharmaceutical Group Industry Co., Ltd. on Deposit and Actual Use of Proceeds for the Six Months
Ended 30 June 2022 disclosed by the Company on 11 August 2022.
Interim Report 2022 79
2. Matters about share repurchase
Pursuant to the Resolution on Share Repurchase Scheme by Way of Centralized bidding transactions and other resolutions
considered and approved at the 6th Meeting of the 8th Session of the Board and the 2021 Fifth Extraordinary General
Meeting of the Company on 6 December 2021 and 23 December 2021, it was approved that the Company repurchased
company shares by way of Centralized bidding transactions with its own funds; the shares repurchased this time
would be used to reduce the registered capital; the total amount of repurchase funds should be no less than RMB300
million (inclusive) and no more than RMB600 million (inclusive); the repurchase price should be no more than RMB15/
share (inclusive); the repurchase term should be no more than 12 months from the date when the repurchase scheme
was approved by the General Meeting of the Company. For the details, please see the Announcement of Joincare
Pharmaceutical Group Industry Co., Ltd. on the Share Repurchase Scheme by Way of Centralized Bidding Transactions (Lin
2021-145) and the Repurchase Report of Joincare Pharmaceutical Group Industry Co., Ltd. on Share Repurchase by Way of
Centralized Bidding Transactions (Lin 2022-002);
On 20 January 2022, the Company initially repurchased 785,992 shares by way of centralized price bidding, representing
0.04% of total share capital of the Company (1,907,727,908 shares); the total amount paid was RMB9.9807 million (including
the transaction costs); see the Announcement of Joincare Pharmaceutical Group Industry Co., Ltd. on Initial Share
Repurchase by Way of Centralized Bidding Transactions (Lin 2022-004) for details;
As a result of the cash dividend of the Company for the year 2021, the above price cap of repurchased shares was adjusted
to RMB14.85/share; see the Announcement of Joincare Pharmaceutical Group Industry Co., Ltd. on Adjustment of the Price
Cap of the Company’s Shares by Way of Centralized Bidding Transactions after the Equity Distribution for the Year 2021 (Lin
2022-068);
On 7 July 2022, the Company completed the repurchase. The Company cumulatively repurchased 50,959,668 shares
by way of centralized price bidding, representing 2.66% of total share capital of the Company (1,912,540,667 shares);
the maximum repurchase price was RMB13.02/share; the minimum repurchase price was RMB10.02/share; the average
repurchase price was RMB11.77/share; the total amount paid was RMB599,981,715.83 (including commissions);
and de-registration of 50,959,668 purchased shares this time was completed on 11 July 2022. For details, see the
Announcement of Joincare Pharmaceutical Group Industry Co., Ltd. on Implementation Results of Share Repurchase and
Share Changes (Lin 2022-076).
3. Overall relocation and expansion project of Sichuan Guangda
On 6 March 2019, the Board of Directors of Livzon Group, a controlling subsidiary of the Company, considered and
approved to enter into the “Investment Agreement for the Overall Relocation and Expansion Project of Sichuan Guangda
Pharmaceutical Manufacturing” 《四川光大制药整体搬迁调迁扩建项目投资协议书》) (the “Investment Agreement”) and
(
the Supplemental Agreement I with Sichuan Chengdu Pengzhou Municipal People’s Government (四川省成都市彭州市
人民政府). Pursuant to the Investment Agreement, the Company will inject capital of RMB646 million for investment in
construction of the overall relocation and expansion project (the “Project”) of Sichuan Guangda, a wholly-owned subsidiary
of the Company. Pursuant to the Supplemental Agreement I, Pengzhou Municipal People’s Government has agreed to
pay a compensation for demolition of RMB90 million and grant total incentive of not more than RMB125.8 million for the
construction of new plant to the Company.
As of 30 June 2022, the total investment of the specific contracts entered into for the Project amounted to RMB477.4202
million, and the sum of subsidies received from government authorities at various levels amounted to RMB137.1799
million, the construction works for the warehousing system and the QC main body were completed, the construction
works for the main body of the extraction workshop and the pre-treatment workshop were implemented, and the
foundation construction works for the granulation workshop, the comprehensive preparation workshop and the packaging
workshop were implemented, and the overall Project was smooth in progress.
80 Joincare Pharmaceutical Group Industry Co., Ltd.
4. Invested company Tianjin Tongrentang initial public offering of shares and listing progress
The Shenzhen Stock Exchange suspended the review of listing of Tianjin Tongrentang Group Co., Ltd. (天津同仁堂集
团股份有限公司) (“Tianjin Tongrentang”) on 26 January 2022, as CSRC has initiated an investigation against ShineWing
Certified Public Accountants (Special General Partnership), the accountant engaged by Tianjin Tongrentang for the initial
public offering of its shares and listing on the ChiNext Board.
Since ShineWing Certified Public Accountants (Special General Partnership), the engaged accountant, has issued the
review report, the Shenzhen Stock Exchange resumed the review of listing of Tianjin Tongrentang on 30 March 2022.
Save as disclosed above, please refer to the 2021 Annual Report of the Company for its investment in Tianjin Tongrentang.
5. Livzon Group’s plan to spin off Livzon Diagnostics for A-share listing progress
On 7 August 2020, the Board of Directors of Livzon Group, a majority-controlled subsidiary of the Company, considered
and approved the proposal to spin off its subsidiary Zhuhai Livzon Diagnostics Inc. (hereinafter referred to as Livzon
Diagnostics) for A-share listing (hereinafter referred to as spin-off listing). Livzon Diagnostics is mainly engaged in the
R&D, production and sale of diagnostic reagents and equipment. As at the end of the Reporting Period, Livzon Group held
approximately 39.425% of shares of Livzon Diagnostics. After completion of this spin-off, the shareholding structure of
Livzon Group will remain unchanged, and Livzon Group will still maintain control over Livzon Diagnostics. For more details,
please see “the Suggestive Announcement of Joincare Pharmaceutical Group Industry Co., Ltd. on Livzon Group’s Planned
Spin-off of Its Subsidiary Livzon Diagnostics for A-share Listing” (Lin 2020-106).
On 16 October 2020, the Stock Exchange of Hong Kong Limited agreed to Livzon Group’s spin-off listing, and agreed to
exempt the group from the applicable regulations concerning the assured entitlement related to the spin-off listing. For
details, see the Announcement of Joincare Pharmaceutical Group Industry Co., Ltd. on the progress of Livzon Group’s
Planned Spin-off of Its Subsidiary Livzon Diagnostics for A-share Listing (Lin 2020-131).
Livzon Diagnostics would go spin-off listing on the ChiNext Board of Shenzhen Stock Exchange pursuant to the Resolution
on the Spin-off of the Subsidiary Zhuhai Livzon Diagnostics Inc. to Go Listing on the ChiNext Board of Shenzhen Stock
Exchange considered and approved at the Board meeting of Livzon Group on 23 October 2020. For details, see the
Announcement of Joincare Pharmaceutical Group Industry Co., Ltd. on the progress of Livzon Group’s Planned Spin-off of
Its Subsidiary Livzon Diagnostics for A-share Listing (Lin 2020-134).
The spin-off listing of Livzon Diagnostics was approved at the 2020 4th extraordinary general meeting of Livzon Group on
20 November 2020, and was registered with Guangdong Securities Regulatory Bureau for pre-listing tutoring in November
2020. As of the disclosure date of this report, Livzon Diagnostics has submitted the seven issues of reports on progress of
the tutoring. As of the disclosure date of this report, Livzon Diagnostics has not submitted any application to or registered
with Shenzhen Stock Exchange or any relevant Chinese regulatory authorities other than those progresses listed above.
6. Progress of the Company planned to issue GDR and list on the Swiss Stock Exchange
On 15 June 2022, the Company held the 12th Meeting of the 8th Session of the Board, at which the Resolution for
Issuance of Global Depository Receipts Overseas and Listing on the Swiss Stock Exchange was considered and approved.
The resolution is designated to expand international finance channels and promote the international brand image of
the Company. The Company proposed to issue Global Depository Receipts (“GDR”) overseas and list on the Swiss Stock
Exchange, the details of which set out in the Indicative Announcement of Joincare Pharmaceutical Group Industry Co., Ltd.
on Planning to Issue Global Depository Receipts Overseas and List on the Swiss Stock Exchange (Lin 2022-061).
Interim Report 2022 81
On 22 June 2022, the Company convened the 13rd Meeting of the 8th Session of the Board, at which the Resolution on the
Company’s Issuance of GDR and Listing on the Swiss Stock Exchange and Conversion into a Joint Stock Limited Company
Offering Shares Overseas, the Resolution on the Company’s Issuance of GDR and Listing on the Swiss Stock Exchange
and other relevant resolutions were considered and approved. For this issuance of GDR, the newly issued RMB ordinary
A shares of the Company are used as the underlying securities. The new underlying A shares represented by GDR do not
exceed 191,254,066 shares, including the securities issued due to the exercise of any over-allotment options (if any), and
do not exceed 10% of the total share capital of ordinary share of the Company (1,912,540,667) before this issuance. In the
event that the Company's share capital increases or decreases due to bonus issue, bonus share issue by way of conversion
of capital reserve or rights issue, repurchase during the period from the date of the resolution of the Board of Directors
to the issuance date, the number of new underlying A shares represented by GDR shares will be adjusted accordingly
in accordance with relevant regulations. Meanwhile, the Company formulated the Confidentiality and File Management
Policy related to Overseas Securities Issuance and Listing of Joincare Pharmaceutical Group Industry Co., Ltd., and revised
the Articles of Association, Rules of Procedure for General Meetings and other Company rules and regulations involving
GDR. For details, see the Announcement on the Resolutions of Joincare Pharmaceutical Group Industry Co., Ltd. at the 13th
Meeting of the 8th Session of the Board (Lin 2022-063) and the Announcement on the Establishment of the Articles of
Association and its Appendixes Applicable to the Company upon the Listing of GDR in accordance with the Confidentiality
and File Management Policy related to Overseas Securities Issuance and Listing of Joincare Pharmaceutical Group Industry
Co., Ltd. (Lin 2022-064).
On 8 July 2022, the Company held the Second Extraordinary General Meeting of 2022, at which related resolutions
concerning issuance of GDR overseas and listing on the Swiss Stock Exchange were considered and approved. At the
meeting we also submitted to the General Meeting to authorize the Board of Directors and its authorized persons to take
full charge of all the matters involved in GDR issuance and listing. For details, see the Announcement on Resolutions of
Joincare Pharmaceutical Group Industry Co., Ltd. at the Second Extraordinary General Meeting of 2022 (Lin 2022-077).
On 13 July 2022, the Company submitted the above GDR issuance application documents to CSRC and received the
Acceptance Notice from CSRC on 20 July 2022. For details, see the Announcement on GDR Application of Joincare
Pharmaceutical Group Industry Co., Ltd. Accepted by CSRC (Lin 2022-080).
7
Changes in
Equity and
Shareholders
Interim Report 2022 83
Chapter 7 Changes in Equity and Shareholders
I Changes in equity
(I) Changes in shares
1. Changes in shares
Unit: shares
Before the current change Increase/decrease (+, -) due to the current change After the current change
Conversion
Issuance Issuance of capital
of new of bonus reserve to
Number Percentage shares shares share capital Others Subtotal Number Percentage
(%) (%)
I. Shares subject to selling restrictions
1. Shares held by state government
2. Shares held by state-owned entities
3. Shares held by other domestic holders
Including: Shares held by domestic
non-state-owned entities
Shares held by domestic natural persons
4. Shares held by foreign holders
Including: Shares held by foreign entities
Shares held by foreign natural persons
II. Shares not subject to selling restrictions 1,907,727,908 100 4,812,759 0 0 0 4,812,759 1,912,540,667 100
1. Ordinary shares denominated in Renminbi 1,907,727,908 100 4,812,759 0 0 0 4,812,759 1,912,540,667 100
2. Domestically listed foreign shares
3. Overseas listed foreign shares
4. Others
III. Total number of shares 1,907,727,908 100 4,812,759 0 0 0 4,812,759 1,912,540,667 100
2. Description of changes in shares
√ Applicable □N/A
The number of exercisable options during the third exercise period of the first grant under the 2018 Share Options
Incentive Scheme of the Company was 7.263 million and the exercise period was from 21 December 2021 to 20 December
2022. The number of exercisable options during the second exercise period of the reserved grant under the 2018 Share
Options Incentive Scheme of the Company was 2.935 million, and the exercise period was from 23 September 2021 to 22
September 2022 by way of independent exercise.
During the Reporting Period, the number of options exercised and completed share transfer registration under the 2018
Share Options Incentive Scheme of the Company was totaled 4,812,759.
3. Impact of changes in shares on earnings per share, net assets per share and other financial indicators from the Reporting
Period to the date of disclosure of the interim report (if any)
□ Applicable√ N/A
4. Other information deemed necessary by the Company or as required by the securities regulators
□ Applicable√ N/A
84 Joincare Pharmaceutical Group Industry Co., Ltd.
(II) Changes in shares with selling restrictions
□ Applicable√ N/A
II Shareholders
(I) Total number of shareholders:
TotalnumberofordinaryshareholdersattheendoftheReportingPeriod 95,021
Totalnumberofshareholdersofpreferredshareswithresumedvotingrightsattheend
oftheReportingPeriod Notapplicable
(II) Shareholdings of the Top 10 shareholders and the Top 10 shareholders of tradable shares (or shareholders
without selling restrictions) at the End of the Reporting Period
Unit: shares
Shareholdings of the Top 10 shareholders
Change Number of Number of Pledge, mark or lock-up
during the shares held shares held
reporting at the end of with selling Nature of
Name of shareholder (Full name) period the Period Percentage restrictions Share status Number Shareholder
(%)
Shenzhen Baiyeyuan Investment Co., Ltd.* 0 895,653,653 46.83 0 Pledge 95,679,725 Domestic non-state
owned entity
Hong Kong Securities Clearing Company Limited 15,002,871 106,964,297 5.59 0 Unknown Unknown
Might Seasons Limited –14,371,900 57,487,434 3.01 0 Unknown Foreign entity
108 portfolio of national social security fund –810,300 11,461,721 0.60 0 Unknown Unknown
Huaxia Life Insurance Co., Ltd. – Proprietary fund 163,100 9,275,718 0.48 0 Unknown Unknown
16011 portfolio of basic endowment insurance fund –1,089,400 7,960,834 0.42 0 Unknown Unknown
He Zhong –50,000 7,800,024 0.41 0 Unknown Domestic natural
person
Bosera Funds Management Co., Ltd. – 419 portfolio of social –2,143,800 6,589,146 0.34 0 Unknown Unknown
security funds
Joincare Pharmaceutical Group Industry Co., Ltd. – the 6,275,372 6,275,372 0.33 0 Unknown Others
Second Phase Ownership Scheme under Medium to
Long-term Business Partner Share Ownership Scheme
Agricultural Bank of China Limited – CSI 500 Exchange –376,000 5,021,294 0.26 0 Unknown Unknown
Traded Index Securities Investment Fund
Interim Report 2022 85
Shareholdings of the Top 10 shareholders without selling restrictions
Number of tradable Class and number of shares
shares held without
Name of shareholder selling restrictions Class Number
Shenzhen Baiyeyuan Investment Co., Ltd.* 895,653,653 Ordinary shares 895,653,653
denominated in Renminbi
Hong Kong Securities Clearing Company Limited 106,964,297 Ordinary shares 106,964,297
denominated in Renminbi
Might Seasons Limited 57,487,434 Ordinary shares 57,487,434
denominated in Renminbi
108 portfolio of national social security fund 11,461,721 Ordinary shares 11,461,721
denominated in Renminbi
Huaxia Life Insurance Co., Ltd. – Proprietary fund 9,275,718 Ordinary shares 9,275,718
denominated in Renminbi
16011 portfolio of basic endowment insurance fund 7,960,834 Ordinary shares 7,960,834
denominated in Renminbi
He Zhong 7,800,024 Ordinary shares 7,800,024
denominated in Renminbi
Bosera Funds Management Co., Ltd. – 419 portfolio of 6,589,146 Ordinary shares 6,589,146
social security funds denominated in Renminbi
Joincare Pharmaceutical Group Industry Co., Ltd. – the 6,275,372 Ordinary shares 6,275,372
Second Phase Ownership Scheme under Medium to denominated in Renminbi
Long-term Business Partner Share Ownership Scheme
Agricultural Bank of China Limited – CSI 500 Exchange 5,021,294 Ordinary shares 5,021,294
Traded Index Securities Investment Fund denominated in Renminbi
Notes on the special repurchase account among the As at the end of the Reporting Period, the special repurchase
top 10 shareholders account of the Company (special securities repurchase account
of Joincare Pharmaceutical Group Industry Co., Ltd.) owned
62,156,456 shares in total, accounting for 3.25%.
Description of the participation of the top 10 He Zhong, a shareholder, held 800,000 shares through an
shareholders and the top 10 shareholders without ordinary securities account and 7,000,024 shares through a
selling restriction in securities margin trading and credit guarantee account, namely 7,800,024 shares in total.
refinancing business
Description of the above shareholders involved in Not applicable
entrustment/entrusted voting right and waiver of
voting right
Description of connection or acting-in-concert There was no connection or acting-in-concert relationship
relationship of the above shareholders between Shenzhen Baiyeyuan Investment Co., Ltd., a controlling
shareholder of the Company, and other shareholders; whether
there is connection or acting-in-concert relationship among
other shareholders is unknown
Description of holders of preferred shares with resumed Not applicable
voting rights and number of preferred shares
Number of shares held by the Top 10 shareholders with selling restrictions and selling restrictions
□ Applicable√ N/A
(III) Strategic investors or general legal persons who became Top 10 shareholders through placement of new
shares
□ Applicable√ N/A
86 Joincare Pharmaceutical Group Industry Co., Ltd.
III Information on directors, supervisors, and senior management
(I) Changes in shareholdings of current directors, supervisors, and senior management and those who
resigned during the Reporting Period
√ Applicable □ N/A
Unit: shares
Number of Number of Changes in
shares held at shares held at shareholdings
the beginning the end of the during the
Name Title of the Period Period Reporting Period Reason for changes
Yu Xiong Director 660,000 800,000 140,000 Exercise of Equity incentive
Qiu Qingfeng Director 537,409 717,409 180,000 Exercise of Equity incentive
Lin Nanqi Director 1,051,040 1,291,040 240,000 Exercise of Equity incentive
Note: In addition to being a director, Yu Xiong acts as President of the Company, Qiu Qingfeng as the Vice President and CFO of the Company, and Lin Nanqi
as the Vice President of the Company.
Description of other information
□ Applicable√ N/A
(II) Equity incentive granted to directors, supervisors, and senior management during the Reporting Period
√ Applicable □ N/A
Unit: shares
Number of Number of Number of Number of
share options share options exercisable share options Number of
held at the granted during shares during exercised share options
beginning of the Reporting the Reporting during the held at the end
Name Title the Period Period Period Period of the Period
Yu Xiong Director 140,000 0 140,000 140,000 0
Qiu Qingfeng Director 180,000 0 180,000 180,000 0
Lin Nanqi Director 240,000 0 240,000 240,000 0
Zhao Fengguang Senior management 180,000 0 180,000 0 180,000
Total / 740,000 0 740,000 560,000 180,000
Note: In addition to being a director, Yu Xiong acts as President of the Company, Qiu Qingfeng as the Vice President and CFO of the Company, and Lin Nanqi
as the Vice President of the Company.
(III) Others
□ Applicable√ N/A
IV Changes in controlling shareholders or de facto controllers
□Applicable √N/A
8
Information
on Preferred
Shares
88 Joincare Pharmaceutical Group Industry Co., Ltd.
Chapter 8 Information on Preferred Shares
□Applicable √N/A
9
Information on
Bonds
90 Joincare Pharmaceutical Group Industry Co., Ltd.
Chapter 9 Information on Bonds
I Enterprise bonds, corporate bonds, and non-financial enterprise debt financing
instruments
□ Applicable√ N/A
II Information on convertible corporate bonds
□ Applicable√ N/A
10
Financial
Statements
92 Joincare Pharmaceutical Group Industry Co., Ltd.
Chapter 10 Financial Statements
I. Auditor’s report
□ Applicable √ N/A
lnterim Report 2022 93
II. Financial statements
Consolidated Balance Sheet
30 June 2022
Prepared by: Joincare Pharmaceutical Group Industry Co., Ltd. Unit: Yuan Currency: RMB
Item Note 30 June 2022 31 December 2021
Current assets:
Cash and bank balances V.1 12,653,108,949.17 11,729,230,390.98
Financial assets held for trading V.2 99,806,543.32 184,638,344.31
Notes receivable V.3 1,888,473,693.79 1,977,286,022.02
Accounts receivable V.4 2,895,463,163.96 2,853,655,551.54
Receivables financing
Prepayments V.5 438,456,122.38 369,232,546.29
Other receivables V.6 50,888,736.71 88,053,825.12
Including: Interest receivables 365,873.64
Dividend receivables 215,678.92
Inventories V.7 2,254,220,729.87 2,078,944,387.68
Contract assets
Assets held-for-sale
Non-current assets due within one year V.8 38,498.84 317,381.23
Other current assets V.9 51,971,077.28 83,986,214.37
Total current assets 20,332,427,515.32 19,365,344,663.54
Non-current assets:
Debt investment
Other debt investment
Long-term receivables V.10 82,574.69 266,904.13
Long-term equity investment V.11 1,423,034,057.29 1,419,349,454.84
Other equity instrument investments V.12 1,170,558,267.07 1,408,882,377.42
Other non-current financial assets
Investment properties V.13 6,191,475.43 6,191,475.43
Fixed assets V.14 4,742,112,777.95 4,839,005,169.81
Construction in progress V.15 1,138,204,863.10 742,998,743.75
Productive biological assets
Oil & gas assets
Right-of-use assets V.16 45,641,439.30 46,774,759.69
Intangible assets V.17 487,393,277.62 456,782,094.80
Development cost V.18 858,336,350.91 786,993,435.71
Goodwill V.19 614,468,698.73 614,468,698.73
Long-term prepaid expenses V.20 220,173,833.64 200,715,740.93
Deferred tax assets V.21 633,378,856.81 552,542,866.71
Other non-current assets V.22 511,560,279.43 663,584,003.80
Total non-current assets 11,851,136,751.97 11,738,555,725.75
Total assets 32,181,512,667.29 31,103,900,389.29
94 Joincare Pharmaceutical Group Industry Co., Ltd.
Item Note 30 June 2022 31 December 2021
Current liabilities:
Short-term loans V.23 1,982,775,000.02 2,518,484,835.09
Financial liabilities held for trading V.24 10,791,038.40 143,302.24
Notes payable V.25 1,601,063,168.35 1,582,386,767.93
Accounts payable V.26 933,275,211.76 871,553,210.51
Receipts in advance
Contract liabilities V.27 100,704,258.24 234,140,702.29
Employee benefits payable V.28 375,599,648.25 475,430,823.20
Taxes payable V.29 420,134,507.00 270,618,183.41
Other payables V.30 3,398,357,996.68 3,292,407,989.79
Including: Interest payables
Dividend payables 24,631,984.46 6,951,984.46
Liabilities held-for-sale
Non-current liabilities due within one year V.31 93,190,354.84 91,576,066.33
Other current liabilities V.32 7,166,683.80 15,626,224.29
Total current liabilities 8,923,057,867.34 9,352,368,105.08
Non-current liabilities:
Long-term loans V.33 2,403,726,004.58 826,780,252.78
Bonds payable
Lease liabilities V.34 22,599,182.60 25,071,794.32
Long-term payables
Long-term payroll payable
Estimated liabilities
Deferred income V.35 472,360,136.25 433,543,352.40
Deferred tax liabilities V.21 175,493,047.27 208,525,905.39
Other non-current liabilities V.36 84,000,000.00 78,000,000.00
Total non-current liabilities 3,158,178,370.70 1,571,921,304.89
Total liabilities 12,081,236,238.04 10,924,289,409.97
shareholders’ equity
Share capital V.37 1,912,540,667.00 1,907,727,908.00
Other equity instruments
Including: Preferred shares
Perpetual bonds
Capital reserve V.38 2,316,360,798.95 2,265,357,311.92
Less: Treasury shares V.39 742,977,205.72 222,644,454.50
Other comprehensive income V.40 -37,611,311.23 5,387,545.97
Special reserve
Surplus reserve V.41 649,438,942.76 640,821,179.08
Undistributed profits V.42 7,824,914,927.17 7,223,644,166.22
Total shareholders’ equity attributable to the parent 11,922,666,818.93 11,820,293,656.69
Minority shareholder’s equity 8,177,609,610.32 8,359,317,322.63
Total shareholders’ equity 20,100,276,429.25 20,179,610,979.32
Total liabilities and shareholders’ equity (or shareholder’s equity) 32,181,512,667.29 31,103,900,389.29
Person-in-charge of the Company: Person-in-charge of the Company’s accounting work: Person-in-charge of the accounting department:
Zhu Baoguo Qiu Qingfeng Qiu Qingfeng
lnterim Report 2022 95
Balance Sheet of the Parent Company
30 June 2022
Prepared by: Joincare Pharmaceutical Group Industry Co., Ltd. Unit: Yuan Currency: RMB
Item Note 30 June 2022 31 December 2021
Current assets:
Cash and bank balances 2,118,729,226.61 1,370,906,734.13
Financial assets held for trading
Notes receivable 234,490,808.52 374,296,302.21
Accounts receivable 353,134,208.48 535,543,070.24
Receivable financing
Prepayments 457,868,974.09 201,605,530.55
Other receivables 1,093,801,818.49 1,136,237,811.25
Including: Interest receivables
Dividends receivable 769,999,500.00 814,041,000.00
Inventories 725,704.05
Contract assets
Assets held-for-sale
Non-current assets due within one year
Other current assets 9,167,665.15 9,379,100.23
Total current assets 4,267,918,405.39 3,627,968,548.61
Non-current assets:
Debt investment
Other debt investment
Long-term receivables
Long-term equity investment 3,513,434,646.47 3,530,939,152.29
Other equity instrument investment 136,995,826.79 372,609,966.35
Other non-current financial assets
Investment properties 6,191,475.43 6,191,475.43
Fixed assets 46,653,548.90 45,139,232.27
Construction in progress 11,625,599.55 7,890,737.14
Productive biological assets
Oil & gas assets
Right-of-use assets 10,132,677.63 12,470,703.77
Intangible assets 15,181,241.41 15,316,963.24
Development cost 26,092,293.12 21,304,063.68
Goodwill
Long-term prepaid expenses 722,794.65 900,737.50
Deferred income tax assets 157,391,273.73 134,711,371.96
Other non-current assets 54,055,428.72 54,866,150.94
Total non-current assets 3,978,476,806.40 4,202,340,554.57
Total assets 8,246,395,211.79 7,830,309,103.18
96 Joincare Pharmaceutical Group Industry Co., Ltd.
Item Note 30 June 2022 31 December 2021
Current liabilities:
Short-term loans 100,000,000.00 450,436,811.38
Financial liabilities held for trading
Notes payable 484,246,155.59 358,526,972.01
Accounts payable 257,392,547.42 461,763,867.32
Receipts in advance
Contract liabilities 21,785,124.52 31,637,971.91
Employee benefits payable 81,504,877.32 95,624,280.17
Taxes payable 18,276,040.20 17,190,533.60
Other payables 1,759,567,632.80 810,207,330.35
Including: Interest payables
Dividends payable
Liabilities held-for-sale
Non-current liabilities due within one year 45,424,338.61 44,954,632.42
Other current liabilities 3,255,248.49 2,140,860.88
Total current liabilities 2,771,451,964.95 2,272,483,260.04
Non-current liabilities:
Long-term loans 610,000,000.00 160,000,000.00
Bonds payable
Lease liabilities 4,955,487.04 7,683,561.03
Long-term payables
Long-term payroll payable
Estimated liabilities
Deferred income 47,145,500.00 40,796,000.00
Deferred tax liabilities 47,219.34 29,371,338.01
Other non-current liabilities
Total non-current liabilities 662,148,206.38 237,850,899.04
Total liabilities 3,433,600,171.33 2,510,334,159.08
Shareholders’ equity:
Share capital 1,912,540,667.00 1,907,727,908.00
Other equity instruments
Including: Preferred shares
Perpetual bonds
Capital reserve 1,641,909,016.94 1,605,482,128.64
Less: Treasury shares 742,977,205.72 222,644,454.50
Other comprehensive income -3,879,108.52 77,015,953.08
Special reserve
Surplus reserve 560,836,994.38 552,219,230.70
Undistributed profits 1,444,364,676.38 1,400,174,178.18
Total shareholders’ equity attributable to the parent 4,812,795,040.46 5,319,974,944.10
Total liabilities and shareholders’ equity 8,246,395,211.79 7,830,309,103.18
Person-in-charge of the Company: Person-in-charge of the Company’s accounting work: Person-in-charge of the accounting department:
Zhu Baoguo Qiu Qingfeng Qiu Qingfeng
lnterim Report 2022 97
Consolidated Income Statement
January to June, 2022
Prepared by: Joincare Pharmaceutical Group Industry Co., Ltd. Unit: Yuan Currency: RMB
Item Note First half of 2022 First half of 2021
I. Revenue from operations V.43 8,564,945,285.55 7,835,372,274.66
Including: Operating revenues 8,564,945,285.55 7,835,372,274.66
II. Total operating costs 6,767,945,476.66 6,312,457,301.60
Including: Cost of operations V.43 3,054,392,703.20 2,743,005,734.93
Taxes and surcharges V.44 94,322,638.31 90,345,092.56
Selling expenses V.45 2,512,369,792.45 2,499,949,757.30
Administrative expenses V.46 529,828,311.93 397,921,091.17
Research and development expenses V.47 707,433,078.44 622,962,388.41
Financial expenses V.48 -130,401,047.67 -41,726,762.77
Including: Interest expenses 60,979,386.68 38,708,820.91
Interest income 117,501,999.50 78,035,350.84
Add: Other income V.49 97,242,254.03 131,455,378.87
Investment income (“-” for loss) V.50 51,014,159.00 46,810,627.37
Including: Gains from investments in associates and joint ventures 41,208,487.80 9,750,424.27
Gain from derecognition of financial assets at amortized cost (“-” for loss)
Gain from net exposure of hedging (“-” for loss)
Gains from changes of fair value (“-” for loss) V.51 -95,479,537.15 33,316,547.15
Credit impairment loss (“-” for loss) V.52 -2,805,440.83 -9,485,295.67
Assets impairment loss (“-” for loss) V.53 -27,834,495.93 -28,878,059.99
Gain from disposal of assets (“-” for loss) V.54 -510,518.91 17,927,771.94
III. Operating profit (“-” for loss) 1,818,626,229.10 1,714,061,942.73
Add: Non-operating income V.55 4,470,914.88 4,641,364.71
Less: Non-operating expenses V.56 6,741,606.85 6,039,971.44
IV. Total profit (“-” for loss) 1,816,355,537.13 1,712,663,336.00
Less: Income tax expenses V.57 271,175,329.55 244,565,734.30
V. Net profit (“-” for net loss) 1,545,180,207.58 1,468,097,601.70
(I) Classified by continuity of operations:
Including: Net profit from continuing operations (“-” for net loss) 1,545,180,207.58 1,468,097,601.70
Net profit from discontinued operations (“-” for net loss)
(II) Classified by attribution to ownership:
Including: Net profit attributable to shareholders of the parent 801,268,519.50 687,347,494.53
(“-” for net loss)
Net profit attributable to minority interests (“-” for net loss) 743,911,688.08 780,750,107.17
98 Joincare Pharmaceutical Group Industry Co., Ltd.
Item Note First half of 2022 First half of 2021
VI. Other comprehensive income – after tax -25,063,137.51 -161,118,765.76
(I) Other comprehensive income – after tax attributable to shareholders of -42,998,857.20 -80,061,071.46
the parent
1. Other comprehensive income not reclassified into profit or loss -79,078,918.80 -61,841,866.88
subsequently
(1) Changes in remeasurement of defined benefit plan
(2) Share of other comprehensive income of the equity method 1,109,969.99
investments
(3) Changes in fair value of other equity instruments investment -80,188,888.79 -61,841,866.88
(4) Changes in fair value of the Company’s own credit risks
2. Other comprehensive income that will be reclassified into profit or loss 36,080,061.60 -18,219,204.58
subsequently
(1) Share of other comprehensive income of associates and joint ventures
under equity method
(2) Changes in the fair value of other debt investments
(3) Reclassification of financial assets recognised as other comprehensive
income
(4) Credit impairment loss of other debt investments
(5) Cash flow hedging reserve (effective part of cash flow hedging profit
and loss)
(6) Translation of foreign currency financial statements 36,080,061.60 -18,219,204.58
(7) Others
(II) Other comprehensive income – after tax attributable to minority 17,935,719.69 -81,057,694.30
interests
VII. Total comprehensive income 1,520,117,070.07 1,306,978,835.94
(I) Total comprehensive income attributable to shareholders of the parent 758,269,662.30 607,286,423.07
(II) Total comprehensive income attributable to minority interests 761,847,407.77 699,692,412.87
VIII. Earnings per share
(I) Basic earnings per share 0.4235 0.3514
(II) Diluted earnings per share 0.4232 0.3504
Person-in-charge of the Company: Person-in-charge of the Company’s accounting work: Person-in-charge of the accounting department:
Zhu Baoguo Qiu Qingfeng Qiu Qingfeng
lnterim Report 2022 99
Income Statement of the Parent Company
January to June, 2022
Prepared by: Joincare Pharmaceutical Group Industry Co., Ltd. Unit: Yuan Currency: RMB
Item Note First half of 2022 First half of 2021
I. Revenue from operations 1,177,100,137.17 767,872,298.02
Less: Cost of operations 788,887,001.95 461,788,716.17
Taxes and surcharges 7,310,543.59 5,768,988.93
Selling expenses 347,794,247.66 197,183,327.14
Administrative expenses 106,346,117.92 47,548,122.82
Research and development expenses 30,185,363.06 23,202,371.94
Financial expenses -7,269,224.74 -7,191,444.75
Including: Interest expenses 7,190,074.41 1,860,476.04
Interest income 15,043,357.51 9,132,475.57
Add: Other income 874,278.66 559,381.42
Investment income (“-” for loss) 315,106,835.25 595,277,628.57
Including: Gains from investments in associates and joint ventures 576,377.39 -1,300,363.73
Gain from derecognition of financial assets at amortized cost
(“-” for loss)
Gain from net exposure of hedging (“-” for loss)
Gains from changes of fair value (“-” for loss)
Credit impairment loss (“-” for loss) 1,514,532.04 -100,938.45
Assets impairment loss (“-” for loss)
Gain from disposal of assets (“-” for loss)
II. Operating profit (“-” for loss) 221,341,733.68 635,308,287.31
Add: Non-operating income 94,336.14 71,272.57
Less: Non-operating expenses 23,452.93 483,009.57
III. Total profit (“-” for loss) 221,412,616.89 634,896,550.31
Less: Income tax expenses -22,775,639.86 11,595,521.04
IV. Net profit (“-” for net loss) 244,188,256.75 623,301,029.27
(I) Net profit from continuing operations (“-” for net loss) 244,188,256.75 623,301,029.27
(II) Net profit from discontinued operations (“-” for net loss)
100 Joincare Pharmaceutical Group Industry Co., Ltd.
Item Note First half of 2022 First half of 2021
V. Other comprehensive income – after tax -80,895,061.60 -22,304,174.23
(I) . Other comprehensive income not reclassified into profit or loss -80,895,061.60 -22,304,174.23
subsequently
1. Changes in remeasurement of defined benefit plan
2. Share of other comprehensive income of the equity method
investments
3. Changes in fair value of other equity instruments investment -80,895,061.60 -22,304,174.23
4. Changes in fair value of the Company’s own credit risks
(II) Other comprehensive income that will be reclassified into profit
or loss subsequently
1. Share of other comprehensive income of associates and joint
ventures under equity method
2. Changes in the fair value of other debt investments
3. Reclassification of financial assets recognised as other
comprehensive income
4. Credit impairment loss of other debt investments
5. Cash flow hedging reserve (effective part of cash flow hedging
profit and loss)
6. Translation of foreign currency financial statements
7. Others
Other comprehensive income – after tax attributable to minority
interests
VI. Total comprehensive income 163,293,195.15 600,996,855.04
VII. Earnings per share
(I) Basic earnings per share
(II) Diluted earnings per share
Person-in-charge of the Company: Person-in-charge of the Company’s accounting work: Person-in-charge of the accounting department:
Zhu Baoguo Qiu Qingfeng Qiu Qingfeng
lnterim Report 2022 101
Consolidated Cash Flow Statement
January to June, 2022
Prepared by: Joincare Pharmaceutical Group Industry Co., Ltd. Unit: Yuan Currency: RMB
Item Note First half of 2022 First half of 2021
I. Cash flows from operating activities:
Cash received from sales of goods or rendering of services 9,266,508,015.60 7,419,412,296.34
Tax refund received 167,531,739.91 61,962,005.91
Other cash received relating to operating activities V.58 320,066,884.87 284,172,439.10
Sub-total of cash inflows 9,754,106,640.38 7,765,546,741.35
Cash paid for goods and services 2,686,391,136.11 1,884,769,945.39
Cash paid to and on behalf of employees 1,283,240,953.21 1,116,771,823.55
Payments of all types of taxes 862,562,844.21 867,755,091.60
Other cash paid relating to operating activities V.58 3,018,958,482.06 3,150,462,367.45
Sub-total of cash outflows 7,851,153,415.59 7,019,759,227.99
Net cash flows from operating activities 1,902,953,224.79 745,787,513.36
II. Cash flows from investing activities:
Cash received from disposal of investments 216,970,980.42 86,940,226.39
Cash received from returns on investments 121,544,073.53 63,907,310.85
Net cash received from disposal of fixed assets, intangible assets 931,662.20 2,121,444.19
and other long-term assets
Cash received from disposal of subsidiaries and other business 3,311,220.53
units
Other cash received relating to investing activities V.58 12,984,186.55 13,361,577.34
Sub-total of cash inflows 352,430,902.70 169,641,779.30
Cash paid to acquire fixed assets, intangible assets and other long- 739,956,798.62 597,823,351.45
term assets
Cash paid to acquire investments 30,338,557.45 744,000,000.00
Cash paid to acquire subsidiaries and other business units
Other cash paid relating to investing activities V.58 15,394,931.82 1,566,246.09
Sub-total of cash outflows 785,690,287.89 1,343,389,597.54
Net cash flows from investing activities -433,259,385.19 -1,173,747,818.24
III. Cash flows from financing activities:
Cash received from capital contribution 61,420,564.63 474,991,831.37
Including: Cash received from investment by minority interests of 22,444,277.37 428,234,715.52
subsidiaries
Cash received from borrowings 3,620,437,809.48 1,211,215,105.43
Cash received relating to other financing activities V.58 3,124,846.38 2,809,612.35
Sub-total of cash inflows 3,684,983,220.49 1,689,016,549.15
Cash repayments of amounts borrowed 2,583,795,608.09 1,282,584,146.53
Cash payments for interest expenses and distribution of dividends 1,219,425,266.74 1,158,748,844.24
or profits
Including: Dividend paid to minority interests of subsidiaries 900,571,289.90 842,390,603.13
Other cash payments relating to financing activities V.58 538,573,404.10 722,917,255.81
Sub-total of cash outflows 4,341,794,278.93 3,164,250,246.58
Net cash flows from financing activities -656,811,058.44 -1,475,233,697.43
IV. Effect of foreign exchange rate changes on cash and cash 105,379,819.98 -26,647,873.71
equivalents
V. Net increase in cash and cash equivalents 918,262,601.14 -1,929,841,876.02
Add: Opening balance of cash and cash equivalent 11,697,518,141.18 12,122,781,311.49
VI. Closing balance of cash and cash equivalent 12,615,780,742.32 10,192,939,435.47
Person-in-charge of the Company: Person-in-charge of the Company’s accounting work: Person-in-charge of the accounting department:
Zhu Baoguo Qiu Qingfeng Qiu Qingfeng
102 Joincare Pharmaceutical Group Industry Co., Ltd.
Cash Flow Statement of Parent Company
January to June, 2022
Prepared by: Joincare Pharmaceutical Group Industry Co., Ltd. Unit: Yuan Currency: RMB
Item Note First half of 2022 First half of 2021
I. Cash flows from operating activities:
Cash received from sales of goods or rendering of services 1,627,134,774.34 689,547,745.88
Tax refund received
Other cash received relating to operating activities 1,361,915,765.88 253,368,418.30
Sub-total of cash inflows 2,989,050,540.22 942,916,164.18
Cash paid for goods and services 1,220,271,835.02 411,827,084.87
Cash paid to and on behalf of employees 171,079,267.11 83,143,842.68
Payments of all types of taxes 59,188,798.29 49,857,359.03
Other cash paid relating to operating activities 747,239,926.63 464,776,999.67
Sub-total of cash outflows 2,197,779,827.05 1,009,605,286.25
Net cash flows from operating activities 791,270,713.17 -66,689,122.07
II. Cash flows from investing activities:
Cash received from disposal of investments 216,970,980.42
Cash received from returns on investments 403,351,191.73 592,402,254.45
Net cash received from disposal of fixed assets, intangible assets 13,000.00 77,600.00
and other long-term assets
Cash received from disposal of subsidiaries and other business
units
Other cash received relating to investing activities 158,470.77
Sub-total of cash inflows 620,493,642.92 592,479,854.45
Cash paid to acquire fixed assets, intangible assets and other long- 3,688,331.00 2,023,634.00
term assets
Cash paid to acquire investments 319,037,191.00
Cash paid to acquire subsidiaries and other business units
Other cash paid relating to investing activities
Sub-total of cash outflows 3,688,331.00 321,060,825.00
Net cash flows from investing activities 616,805,311.92 271,419,029.45
III. Cash flows from financing activities:
Cash received from capital contribution 38,976,287.26 46,757,115.85
Cash received from borrowings 750,000,000.00 –
Cash received relating to other financing activities 2,214,629.88 1,598,029.40
Sub-total of cash inflows 791,190,917.14 48,355,145.25
Cash repayments of amounts borrowed 650,000,000.00 500,000,000.00
Cash payments for interest expenses and distribution of dividends 281,112,849.39 289,069,487.47
or profits
Other cash payments relating to financing activities 520,332,751.22 229,511,622.91
Sub-total of cash outflows 1,451,445,600.61 1,018,581,110.38
Net cash flows from financing activities -660,254,683.47 -970,225,965.13
IV. Effect of foreign exchange rate changes on cash and cash 1,150.86 -302.33
equivalents
V. Net increase in cash and cash equivalents 747,822,492.48 -765,496,360.08
Add: Opening balance of cash and cash equivalent 1,370,906,734.13 1,369,821,002.61
VI. Closing balance of cash and cash equivalent 2,118,729,226.61 604,324,642.53
Person-in-charge of the Company: Person-in-charge of the Company’s accounting work: Person-in-charge of the accounting department:
Zhu Baoguo Qiu Qingfeng Qiu Qingfeng
lnterim Report 2022 103
Consolidated Statement of Changes in Owner’s Equity
January to June, 2022
Prepared by: Joincare Pharmaceutical Group Industry Co., Ltd. Unit: Yuan Currency: RMB
First half of 2022
Owner’s equity attributable to the parent company
Other equity instruments Less: Other Total
Preferred Perpetual Capital Treasury comprehensive Special Surplus General risk Undistributed Minority shareholders’
Item Share capital share bonds Others reserve shares income reserve reserve reserve profits Subtotal interests equity
I. Balance at end of previous year 1,907,727,908.00 2,265,357,311.92 222,644,454.50 5,387,545.97 640,821,179.08 7,223,644,166.22 11,820,293,656.69 8,359,317,322.63 20,179,610,979.32
Add: Changes in accounting policies
Correction of prior period errors
Business combination under common control
Others
II. Balance in beginning of period 1,907,727,908.00 2,265,357,311.92 222,644,454.50 5,387,545.97 640,821,179.08 7,223,644,166.22 11,820,293,656.69 8,359,317,322.63 20,179,610,979.32
III. Movement over the period (“-” for loss) 4,812,759.00 51,003,487.03 520,332,751.22 -42,998,857.20 8,617,763.68 601,270,760.95 102,373,162.24 -181,707,712.31 -79,334,550.07
(I) Total comprehensive income -42,998,857.20 801,268,519.50 758,269,662.30 761,847,407.77 1,520,117,070.07
(II) Capital contribution or reduction from shareholders 4,812,759.00 34,163,528.26 520,332,751.22 -481,356,463.96 16,410,217.23 -464,946,246.73
1. Capital contribution from ordinary shareholders 4,812,759.00 34,163,528.26 520,332,751.22 -481,356,463.96 16,410,217.23 -464,946,246.73
2. Capitals invested by other equity instrument holders
3. Increase in shareholders’ equity resulted from share-
based payments
4. Others
(III) Appropriation of profits -277,557,631.65 -277,557,631.65 -967,251,289.90 -1,244,808,921.55
1. Transfer to surplus reserve
2. Transfer to general risk reserve
3. Distributions to shareholders -277,557,631.65 -277,557,631.65 -967,251,289.90 -1,244,808,921.55
4. Others
(IV) Transfer within shareholders’ equity 8,617,763.68 77,559,873.10 86,177,636.78 86,177,636.78
1. Capital reserve converting into share capital (or capital)
2. Surplus reserve converting into share capital (or capital)
3. Surplus reserve cover the deficit
4. Changes of equity from the revaluation of defined benefit
plan
5. Other comprehensive income transfer to retained 8,617,763.68 77,559,873.10 86,177,636.78 86,177,636.78
earnings
6. Others
(V) Specific reserve
1. Appropriation for the period
2. Used in the period (“-” for loss)
(VI) Others 16,839,958.77 16,839,958.77 7,285,952.59 24,125,911.36
IV. Balance at end of period 1,912,540,667.00 2,316,360,798.95 742,977,205.72 -37,611,311.23 649,438,942.76 7,824,914,927.17 11,922,666,818.93 8,177,609,610.32 20,100,276,429.25
104 Joincare Pharmaceutical Group Industry Co., Ltd.
First half of 2021
Owner’s equity attributable to the parent company
Other equity instruments Less: Other Minority Total
Preferred Perpetual Capital Treasury comprehensive Special Surplus General risk Undistributed shareholder’s shareholders’
Item Share capital shares bonds Others reserve shares income reserve reserve reserve profits Subtotal equity equity
I. Balance at end of previous year 1,952,780,764.00 2,533,288,674.28 253,637,154.50 116,300,559.28 515,941,465.19 6,231,451,582.26 11,096,125,890.51 8,140,772,186.49 19,236,898,077.00
Add: Changes in accounting policies
Correction of prior period errors
Business combination under common control
Others
II. Balance in beginning of period 1,952,780,764.00 2,533,288,674.28 253,637,154.50 116,300,559.28 515,941,465.19 6,231,451,582.26 11,096,125,890.51 8,140,772,186.49 19,236,898,077.00
III. Movement over the year (“-” for loss) 5,812,453.00 90,832,636.74 229,511,622.91 -80,061,071.46 475,713,532.40 262,785,927.77 -114,422,359.65 148,363,568.12
(I) Total comprehensive income -80,061,071.46 687,347,494.53 607,286,423.07 699,692,412.87 1,306,978,835.94
(II) Capital contribution or reduction from shareholders 5,812,453.00 42,329,998.05 229,511,622.91 -181,369,171.86 -96,353,455.66 -277,722,627.52
1. Capital contribution from ordinary shareholders 5,812,453.00 40,944,662.85 229,511,622.91 -182,754,507.06 -96,353,455.66 -279,107,962.72
2. Capitals invested by other equity instrument holders
3. Increase in shareholders’ equity resulted from share- 1,385,335.20 1,385,335.20 1,385,335.20
based payments
4. Others
(III) Appropriation of profits -288,675,388.05 -288,675,388.05 -840,923,997.09 -1,129,599,385.14
1. Transfer to surplus reserve
2. Transfer to general risk reserve
3. Distributions to shareholders -288,675,388.05 -288,675,388.05 -840,923,997.09 -1,129,599,385.14
4. Others
(IV) Transfer within shareholders’ equity 77,041,425.92 77,041,425.92 94,885,363.55 171,926,789.47
1. Capital reserve converting into share capital (or capital)
2. Surplus reserve converting into share capital (or capital)
3. Surplus reserve cover the deficit
4. Changes of equity from the revaluation of defined benefit
plan
5. Other comprehensive income transfer to retained 77,041,425.92 77,041,425.92 94,885,363.55 171,926,789.47
earnings
6. Others
(V) Specific reserve
1. Appropriation for the period
2. Used in the period (“-” for loss)
(VI) Others 48,502,638.69 48,502,638.69 28,277,316.68 76,779,955.37
IV. Balance at end of period 1,958,593,217.00 2,624,121,311.02 483,148,777.41 36,239,487.82 515,941,465.19 6,707,165,114.66 11,358,911,818.28 8,026,349,826.84 19,385,261,645.12
Person-in-charge of the Company: Person-in-charge of the Company’s accounting work: Person-in-charge of the accounting department:
Zhu Baoguo Qiu Qingfeng Qiu Qingfeng
lnterim Report 2022 105
Statement of Changes in Owner’s Equity of the Parent Company
January to June, 2022
Prepared by: Joincare Pharmaceutical Group Industry Co., Ltd. Unit: Yuan Currency: RMB
First half of 2022
Other equity instruments Less: Other Total
Share Preferred Perpetual Capital Treasury comprehensive Special Surplus Undistributed shareholders’
Item capital share bonds Others reserve shares income reserve reserve profits equity
I. Balance at end of previous year 1,907,727,908.00 1,605,482,128.64 222,644,454.50 77,015,953.08 552,219,230.70 1,400,174,178.18 5,319,974,944.10
Add: Changes in accounting policies
Correction of errors
Others
II. Balance in beginning of period 1,907,727,908.00 1,605,482,128.64 222,644,454.50 77,015,953.08 552,219,230.70 1,400,174,178.18 5,319,974,944.10
III. Movement over the period 4,812,759.00 36,426,888.30 520,332,751.22 -80,895,061.60 8,617,763.68 44,190,498.20 -507,179,903.64
(“-” for loss)
(I) Total comprehensive income -80,895,061.60 244,188,256.75 163,293,195.15
(II) Capital contribution or reduction 4,812,759.00 34,163,528.26 520,332,751.22 -481,356,463.96
from shareholders
1. Capital contribution from 4,812,759.00 34,163,528.26 520,332,751.22 -481,356,463.96
shareholders
2. Capitals invested by other equity
instrument holders
3. Increase in shareholders’ equity
resulted from share-based payments
4. Others
(III) Appropriation of profits -277,557,631.65 -277,557,631.65
1. Transfer to surplus reserve
2. Distributions to shareholders -277,557,631.65 -277,557,631.65
3. Others
(IV) Transfer within shareholders’ 8,617,763.68 77,559,873.10 86,177,636.78
equity
1. Capital reserve converting into share
capital (or capital)
2. Surplus reserve converting into
share capital (or capital)
3. Surplus reserve cover the deficit
4. Changes of equity from the
revaluation of defined benefit plan
5. Other comprehensive income 8,617,763.68 77,559,873.10 86,177,636.78
transfer to retained earnings
6. Others
(V) Specific reserve
1. Appropriation for the period
2. Used in the period (“-” for loss)
(VI) Others 2,263,360.04 2,263,360.04
IV. Balance at end of period 1,912,540,667.00 1,641,909,016.94 742,977,205.72 -3,879,108.52 560,836,994.38 1,444,364,676.38 4,812,795,040.46
106 Joincare Pharmaceutical Group Industry Co., Ltd.
First half of 2021
Other equity instruments Less: Other Total
Share Preferred Perpetual Capital Treasury comprehensive Special Surplus Undistributed shareholders’
Item capital share bonds Others reserve shares income reserve reserve profits equity
I. Balance at end of previous year 1,952,780,764.00 2,169,622,381.22 253,637,154.50 110,581,751.29 427,339,516.81 564,932,141.19 4,971,619,400.01
Add: Changes in accounting policies
Correction of errors
Others
II. Balance in beginning of year 1,952,780,764.00 2,169,622,381.22 253,637,154.50 110,581,751.29 427,339,516.81 564,932,141.19 4,971,619,400.01
III. Movement over the period 5,812,453.00 46,862,278.46 229,511,622.91 -22,304,174.23 334,625,641.22 135,484,575.54
(“-” for loss)
(I) Total comprehensive income -22,304,174.23 623,301,029.27 600,996,855.04
(II) Capital contribution or reduction 5,812,453.00 42,329,998.05 229,511,622.91 -181,369,171.86
from shareholders
1. Capital contribution from 5,812,453.00 40,944,662.85 229,511,622.91 -182,754,507.06
shareholders
2. Capitals invested by other equity
instrument holders
3. Increase in shareholders’ equity 1,385,335.20 1,385,335.20
resulted from share-based payments
4. Others
(III). Profit distribution – -288,675,388.05 -288,675,388.05
1. Transfer to surplus reserve
2. Distributions to shareholders -288,675,388.05 -288,675,388.05
3. Others
(IV) Transfer within shareholders’
equity
1. Capital reserve converting into share
capital (or capital)
2. Surplus reserve converting into
share capital (or capital)
3. Surplus reserve cover the deficit
4. Changes of equity from the
revaluation of defined benefit plan
5. Other comprehensive income
transfer to retained earnings
6. Others
(V) Specific reserve
1. Appropriation for the period
2. Used in the period (“-” for loss)
(VI) Others 4,532,280.41 4,532,280.41
IV. Balance at end of period 1,958,593,217.00 2,216,484,659.68 483,148,777.41 88,277,577.06 427,339,516.81 899,557,782.41 5,107,103,975.55
Person-in-charge of the Company: Person-in-charge of the Company’s accounting work: Person-in-charge of the accounting department:
Zhu Baoguo Qiu Qingfeng Qiu Qingfeng
lnterim Report 2022 107
Joincare Pharmaceutical Group Industry Co., Ltd
Notes to the financial statements
(All amounts in RMB Yuan unless otherwise stated)
I Company Profile
1. Overview
√ Applicable □ N/A
The Company is formerly known as Shenzhen Aimier Food Co., Ltd. (深圳爱迷尔食品有限公司), was a Sino-foreign joint
venture officially established on 18 December 1992 with the approval from Shenzhen Administration for Industry and
Commerce.
On 24 November 1999, the Company was reorganized as a joint stock limited company.
On 6 February 2001, the Company was approved by the China Securities Regulatory Commission to issue domestically
listed shares (A shares) to the public. On 8 June 2001, shares of the Company were listed and traded on Shanghai Stock
Exchange.
As of 30 June 2022, the total share capital of the Company was RMB1,912,540,667 and the total number of shares of the
Company was 1,912,540,667. The controlling shareholder of the Company is Shenzhen Baiyeyuan Investment Co., Ltd. (深
圳市百业源投资有限公司), and the ultimate controlling party is Zhu Baoguo (朱保国).
The Company is engaged in the integrated pharmaceutical industry.
The Company and its subsidiaries primarily engaged in the R&D, production and sale of pharmaceutical products
and healthcare products, which covered drug preparation products, active pharmaceutical ingredients (“APIs”) and
intermediates, diagnostic reagents and equipment as well as healthcare products.
The financial statements and notes to the financial statements of the Company were approved at the 15th Meeting of the
8th Session of the Board on 10 August 2022.
2. Scope of consolidated financial statements
√ Applicable □ N/A
The information of subsidiaries included in the scope of consolidation for the first six months of 2022 refer to Note VII
“Equity in other entities” and the information of the changes in scope of consolidation during the period refer to Note VI
“Changes in scope of consolidation”.
108 Joincare Pharmaceutical Group Industry Co., Ltd.
II Basis of Preparation for the Financial Statements
1. Basis of preparation
The Company’s financial statements have been prepared on the going-concern basis.
2. Continuing operation
√ Applicable □ N/A
The financial statements have been prepared in accordance with the Accounting Standards for Business Enterprises
issued by the Ministry of Finance of People’s Republic of China (“MOF”) and its application guidance, interpretations and
the other related provisions (collectively, the “Accounting Standards for Business Enterprises”). In addition, the Company
also discloses relevant financial information in accordance with the Information Disclosure and Presentation Rules for
Companies Offering Securities to the Public No. 15 – General Provisions on Financial Reporting (2014 Revision) issued by
the China Securities Regulatory Commission.
The financial statements have been prepared on the going-concern basis.
The Company’s accounting is measured on an accrual basis. Except for certain financial instruments, the financial
statements are generally measured at historical cost. Non-current assets held for sale are stated at the lower of fair value
less estimated selling costs and their original carrying amount if they qualify as held for sale. In case of asset impairment,
the Company shall make provisions for impairment in accordance with applicable provisions.
III Significant Accounting Policies and Accounting Estimates
Specific accounting policies and accounting estimate tips:
√ Applicable □ N/A
The Company determines the depreciation of fixed assets, amortisation of intangible assets, capitalisation condition of
R&D expenses and revenue recognition policies on the basis of its production and operation characteristics. Details of
accounting policies are set out in Note III. 16, Note III. 20, Note III. 21 and Note III. 28.
1. Statement of compliance with the Accounting Standards for Business Enterprises
The financial statements comply with the Accounting Standards for Business Enterprises, which gave a true and complete
view of the consolidated and the Company’s financial positions as at June 30, 2022, and the consolidated and the
Company’s operating results and the consolidated and the Company’s cash flows and other relevant information for the 6
months period ending June 30, 2022.
2. Accounting period
The fiscal year of the Company is from 1 January to 31 December in each calendar year.
3. Business cycle
√ Applicable □ N/A
The Company’s operating cycle is 12 months.
4. Functional currency
The functional currency of the Company and its domestic subsidiaries is Renminbi (“RMB”). Overseas subsidiaries of the
Company usually recognise HK dollar, Macau Pataca and US dollar as their functional currencies according to the primary
economic environment of which these subsidiaries operate. The Company prepares its financial statements in RMB.
lnterim Report 2022 109
5. Accounting treatment for business combinations involving enterprises under common control and
business combinations involving enterprises not under common control
√ Applicable □ N/A
(1). Business combinations involving enterprises under common control
For the business combination involving entities under common control, the assets acquired and liabilities assumed are
measured based on their carrying amounts in the consolidated financial statements of the ultimate controlling party as
at the combination date, except the adjustment made due to different accounting policies. The difference between the
carrying amount of the consideration paid for the combination and the net assets acquired is adjusted against share
premium in the capital reserve, with any excess adjusted against retained earnings.
Business combination involving enterprises under common control and achieved in a number of transactions
In the separate financial statements, the initial investment cost will be recognised at the carrying amount of the Company’s
share in the combined party’s net assets in the consolidated financial statements of the ultimate controlling party on
the date of combination. The difference between the initial investment cost and the sum of the carrying amount of the
investment held and the carrying amount of consideration paid for the combination at the combination date is adjusted
against share premium in the capital reserve, with any excess adjusted against retained earnings.
In the consolidated financial statements, the assets acquired and liabilities assumed are measured based on their carrying
amounts in the consolidated financial statements of the ultimate controlling party as at the combination date, except
the adjustment made due to different accounting policies. The difference between sum of the carrying amount of the
investment held and the carrying amount of the consideration paid for the combination and the carrying amount of the
net assets acquired is adjusted against share premium in the capital reserve, with any excess adjusted against retained
earnings. For long-term equity investment held before the control over the combined party is obtained, profit or loss,
other comprehensive income and other changes to equity interest attributable to the owners recognised from the later
of the acquisition of the original equity interest and the date when the combing party and the combined party are placed
under common control until the date of combination shall be offset against retained profit at the beginning of the period
of the comparative financial statements or profit or loss of the period respectively.
(2). Business combinations involving enterprises not under common control
For the business combinations involving enterprises not under common control, the combination cost shall be the fair
value of the assets transferred, liabilities incurred or assumed, and equity securities issued by the acquirer for acquisition of
control in the acquiree on the acquisition date. The assets, liabilities and contingent liabilities acquired or assumed on the
date of acquisition are recognised at fair value.
Where the combination cost exceeds the fair value of the acquiree’s identifiable net assets in the business combination,
the difference is recognised as goodwill and is subsequently measured at cost less accumulated impairment provisions.
Where the combination cost is less than the fair value of the acquiree’s identifiable net assets in the business combination,
the difference shall be included in profit or loss for the period after review.
110 Joincare Pharmaceutical Group Industry Co., Ltd.
Business combination involving enterprises not under common control and achieved in a number of transactions
In the separate financial statements, the initial cost of the investment is the sum of the carrying amount of the acquiree’s
equity investment held before the acquisition date and the additional investment cost on the acquisition date. In respect
of the equity investment held prior to the acquisition date, other comprehensive income will not be recognised using
equity method on the acquisition date, and such investment will be accounted for on the same accounting treatment as
direct disposal of relevant asset or liability by the investee at the time of disposal. Shareholder’s equity recognised due to
the changes of other shareholder’s equity other than the changes of net loss and profit, other comprehensive income and
profit distribution shall be transferred to profit or loss for current period when disposed. If the equity investment held prior
to the acquisition date is measured at fair value, the cumulative changes in fair value recognised in other comprehensive
income shall be transferred to profit or loss for current period when accounted for using cost method.
In the consolidated financial statements, the combination cost is the sum of consideration paid on the acquisition date
and fair value of the acquiree’s equity held prior to the acquisition date. The equity of the acquirees held before the
acquisition date is re-measured at the fair value of the equity on the acquisition date and the differences between the fair
value and the carrying amount are recognised in the income for the current period; in respect of any other comprehensive
income attributable to the equity interest in the acquiree held prior to the acquisition date and any changes of other
shareholder’s equity shall be transferred to investment profit or loss for current period on the acquisition date, except
for the other comprehensive income incurred due to the changes arising from remeasuring net assets or net liabilities of
defined benefit plan attributable to the acquiree.
(3). Transaction fees attribution during the combination
The intermediary and other relevant administrative expenses such as audit, legal and valuation advisory for business
combinations are recognised in profit or loss when incurred. Transaction costs of equity or debt securities issued as the
considerations of business combination are included in the initial recognition amounts.
6. Preparation of consolidated financial statements
√ Applicable □ N/A
(1) Scope of consolidation
The scope of consolidated financial statements is determined based on control. Control means the Company has
exposures or rights to variable returns from its involvement with the investee and the ability to affect those returns
through power over such investee. Subsidiaries are the entities controlled by the Company (including enterprises, a
dividable part of investees and structured entities).
(2) Method for preparation of the consolidated financial statements
The consolidated financial statements are based on the financial statements of the Company and its subsidiaries, and
are prepared by the Company in accordance with other relevant information. In preparing the consolidation financial
statements, the Company and its subsidiaries are required to apply consistent accounting policy and accounting period,
intra-group transactions and balances shall be offset.
A subsidiary or a business acquired through a business combination involving entities under common control in the
reporting period shall be included in the scope of the consolidation of the Company from the date when it is under
control of the ultimate controlling party, and then its operating results and cash flows will be included in the consolidated
income statement and the consolidated cash flow statement, respectively.
lnterim Report 2022 111
For a subsidiary or a business acquired through a business combination involving entities not under common control in
the reporting period, its income, expenses and profits are included in the consolidated income statement, and its cash
flows are included in the consolidated cash flow statement from the acquisition date to the end of the reporting date.
The shareholders’ equity of the subsidiaries that are not attributable to the Company shall be presented under
shareholders’ equity in the consolidated balance sheet as minority interests. The portion of net profit or loss of subsidiaries
for the period attributable to minority interest is presented in the consolidated income statement under the “profit or
loss of minority interest”. When the amount of loss attributable to the minority shareholders of a subsidiary exceeds the
minority shareholders’ portion of the opening balance of owners’ equity of the subsidiary, the excess amount shall be
allocated against minority interest.
(3) Purchase of the minority stake in the subsidiary
The difference between the long-term equity investments costs acquired by the purchase of minority interests and
the share of the net assets that the subsidiaries have to continue to calculate from the date of purchase or the date
of consolidation in proportion to the new shareholding ratio, and the difference between the disposal of the equity
investment without losing control over its subsidiary and the disposal of the long-term equity investment corresponding
to the share of the net assets of the subsidiaries from the date of purchase or the date of consolidation, shall be adjusted
to the capital reserve (or share premium), if the capital reserve is not sufficient, any excess will be adjusted to retained
earnings.
(4) Treatment of loss of control of subsidiaries
Where the Company loses its control over the original subsidiary due to the disposal of some equity investment or
other reasons, the remaining equity is re-measured at its fair value on the date when the Company loses its control.
The difference between the sum of the consideration acquired due to the disposal of the equity and the fair value of
the remaining equity, and the Company’s share in the sum of carrying value of net assets of the original subsidiary and
goodwill calculated on an ongoing basis from the acquisition date based on the original shareholding proportion is
recognised in the investment income for the current period when the control is lost.
Other comprehensive income in relation to the original subsidiary’s equity investment are transferred to profit or loss for
the current period when control ceases, except for those arising from re-measuring net assets or net liabilities of defined
benefit plan by the investee.
(5) Treatment of disposal through several transactions until the loss of control of subsidiaries
Where the Company disposes of the equity interests in the subsidiary through several transactions until it loses control,
and the transaction terms, conditions and economic effects satisfy one or several of the following circumstances, such
several transactions shall be deemed as a basket of transactions in accounting treatment:
① Such transactions are entered into simultaneously or upon the consideration of the mutual impacts;
② No complete commercial result will be realised without such transactions as a whole;
③ The occurrence of one transaction depends on the occurrence of at least another transaction;
④ The result of an individual transaction is not economical, but it would be economical after taken into account of other
transactions in the series.
112 Joincare Pharmaceutical Group Industry Co., Ltd.
In the separate financial statements, where the Company disposes of the equity investment in the subsidiary through
several transactions until the loss of control, and such transactions are not regarded as “a basket of transactions”, the
carrying amount of the long-term equity investment involving each disposal will be carried forward, with the difference
between the disposal price and the carrying amount of the long-term equity investment involving the disposal being
accounted into the investment incomes for the current period; where the transactions constitute “a basket of transactions”,
the difference between the consideration of each disposal and the carrying amount of the long-term equity investment
involving the disposal before the loss of the control, is recognised as the other comprehensive income and will be carried
forward to the profit or loss for the current period when the control is lost.
In the consolidated financial statements, where the Company disposes of the equity investment in the subsidiary through
several transactions until the loss of control, the measurement of the remaining equity interest and the accounting
treatment of the losses and gains of the disposal will be made with reference to the “Treatment of loss of control of
subsidiaries” as described above. For the difference between the consideration of each disposal before the loss of the
control and the carrying amount of the Company’s share in the net assets involving the disposal of such subsidiary
calculated on an on-going basis from the acquisition date, the treatment will be made as follows:
① In case the transactions are “a basket of transactions”, such difference is recognised as the other comprehensive
income and will be carried forward to the profit or loss for the current period when the control is lost.
② In case the transactions are not “a basket of transactions”, such difference is accounted into the capital reserve (or
share premium) as equity, and shall not be carried forward to the profit or loss for the current period when the control
is lost.
7. Classification of joint arrangement and accounting treatment for joint operation
√ Applicable □ N/A
A joint arrangement is an arrangement jointly controlled by two or more parties. The Company’s joint arrangement is
classified into the joint operation and the joint venture.
(1) Joint operation
A joint operation is a joint arrangement whereby the Company have rights and obligations to the relevant assets and
liabilities.
The Company recognises the following items in relation to its interest in a joint operation, and makes corresponding
accounting treatment in accordance with relevant accounting standards:
A. The solely-held assets, and the share of any assets held jointly;
B. The solely-assumed liabilities, and its share of any liabilities incurred jointly;
C. Its revenue from the sale of its share of the output arising from the joint operation;
D. Its share of the revenue from the sale of the output by the joint operation;
E. The solely-incurred expenses, including its share of any expenses incurred jointly.
(2) Joint ventures
A joint venture is a joint arrangement whereby the Company only entitled to the net assets of the arrangements.
The Company’s investment in joint ventures is accounted for using the equity method according to the rules of the long-
term equity investment.
lnterim Report 2022 113
8. Standards for determination of cash and cash equivalents
Cash and cash equivalents of the Company include cash on hand, bank deposit readily available for payment and those
investments held by the Company that are short-term (normally due in three months since the acquisition date), highly
liquid, readily convertible into known amounts of cash and subject to an insignificant risk of change in value.
9. Foreign currency transactions and translation of financial statements in foreign currency
√ Applicable □ N/A
(1) Foreign currency transactions
Foreign currency transactions incurred by the Company are translated to the functional currency at the spot exchange
rates on the date of the transactions upon initial recognition.
Monetary items denominated in foreign currencies are translated to functional currency at the spot exchange rate on the
balance sheet date. Exchange differences arising from the differences between the spot exchange rate prevailing at the
balance sheet date and those spot rates used on initial recognition or at the previous balance sheet date are recognised
in profit or loss for the current period; non-monetary items denominated in foreign currencies that are measured at
historical cost are translated using the spot exchange rate on the transaction date. Non-monetary items denominated in
foreign currencies that are measured at fair value are translated using the spot exchange rate on the date the fair value
is determined; the resulting exchange differences between the amounts in functional currency upon translation and in
original functional currency are recognised in profit or loss for the current period.
(2) Translation of financial statements in foreign currency
At the balance sheet date, when translating the foreign currency financial statements of overseas subsidiaries, the assets
and liabilities in the balance sheet are translated at the spot exchange rate at the balance sheet date; all items except for
“Retained earnings” of the shareholders’ equity are translated at the spot exchange rate on the transaction date.
The revenue and expenses in profit or loss are translated at the spot exchange rate on the transaction date.
All items in the statement of cash flows are translated at the spot exchange rate on the transaction date. The effect of
exchange difference on cash is adjusted and separately presented as “Effect of changes in foreign exchange rates on cash
and cash equivalents” in the cash flow statement.
The exchange differences arising from translation of the financial statements are presented as the “other comprehensive
income” in the shareholders’ equity of the balance sheet.
When the Company disposes of the overseas operation and loses control, the differences arising from the translation of
the financial statements in foreign currency that have been presented under the shareholders’ equity in the balance sheet
and involving such overseas operation are carried forward to the profit or loss for the current period in whole or in the
proportion of the disposal of the overseas operation.
10. Financial instruments
√ Applicable □ N/A
Financial instruments are contracts creating financial assets of a party and financial liabilities or equity instruments of other
parties.
114 Joincare Pharmaceutical Group Industry Co., Ltd.
(1) Recognition and De-recognition of financial instruments
A financial asset or financial liability is recognised when the Company becomes one of the parties under a financial
instrument contract.
The financial assets will be derecognised if any of the following conditions is satisfied:
① The contractual right to receive the cash flow of the financial assets is terminated;
② The financial assets have been transferred and the transferred financial asset satisfies the following conditions of
derecognition.
If the current obligation of a financial liability (or a part thereof) has been discharged, the financial liability (or that part of
the financial liability) will be derecognised. When the Company (as the debtor) and the lender have signed an agreement
which uses a new financial liability to replace the existing financial liability, and the contract terms of the new financial
liability are substantially different with the original financial liability, the original financial liability shall be de-recognised,
and the new financial liability shall be recognised at the same time.
The regular transactions of the financial assets are recognised and derecognised at the transaction date.
(2) Classification and measurement of financial assets
The Company classifies financial assets into three categories: financial assets at amortised cost; financial assets at fair value
through other comprehensive income; and financial assets at fair value through profit or loss based on the business model
for managing financial assets and their contractual cash flow characteristics upon initial recognition.
Financial assets at amortised cost
The Company shall classify financial assets that meet the following conditions and are not designated as financial assets at
fair value through profit or loss for the current period as financial assets measured at amortised cost:
A. The Company’s business model for managing the financial assets is to collect contractual cash flow;
B. The terms of the financial asset contract stipulate that the cash flow generated on a specific date is only the payment
for principal and interest accrued on the outstanding principal.
After initial recognition, these financial assets are measured at amortised cost using the effective interest method. Gains
or losses arising from financial assets which are measured at amortised cost and not part of any hedging relationship are
included in the profit and loss of the current period upon de-recognition, amortisation using the effective interest method,
or impairments recognition.
Financial assets at fair value through other comprehensive income
The Company shall classify financial assets that meet the following conditions and are not designated as financial assets
measured at fair value through profit or loss for the current period as financial assets measured at fair value through other
comprehensive income.
A. The Company’s business model for managing the financial assets is both to collect contractual cash flows and to sell the
financial assets;
B. The terms of the financial asset contract stipulate that the cash flow generated on a specific date is only the payment
for principal and interest accrued on the outstanding principal.
lnterim Report 2022 115
After initial recognition, these financial assets are subsequently measured at fair value. Interest, impairment losses or
gains and exchange losses and gains calculated using the effective interest method are recognised in profit or loss for the
current period, while other gains or losses are recognised in other comprehensive income. The cumulative profit or loss
previously included in other comprehensive income will be transferred to the profit or loss for the current period upon
derecognition of the financial assets.
Financial assets at fair value through profit or loss for the current period
In addition to the above financial assets which are measured at amortised cost or at fair value a through other
comprehensive income, the Company classifies all other financial assets as financial assets measured at fair value through
profit or loss for the current period. When initial recognition, in order to eliminate or significantly reduce accounting
mismatches, the Company irrevocably designates some financial assets that should have been measured at amortised cost
or at fair value through other comprehensive income as financial assets at fair value through profit or loss for the current
period.
After initial recognition, these financial assets are subsequently measured at fair value, and the profits or losses (including
interest and dividend income) generated from which are recognised in profit or loss for the current period, unless the
financial assets are part of the hedging relationship.
However, with respect to non-trading equity instrument investments, the Company may irrevocably designate them as
financial assets measured at fair value through other comprehensive income at initial recognition. The designation is made
on the basis of individual investment, and the relevant investment conforms to the definition of equity instruments from
the issuer’s point of view.
After initial confirmation, financial assets are subsequently measured at fair value. Dividend income that meets the
requirements is recognised in profit and loss, and other gains or losses and changes in fair value are recognised in other
comprehensive gains. When derecognised, the accumulated gains or losses previously recognised in other comprehensive
gains are transferred from other comprehensive gains to retained earnings.
The business model of managing financial assets refers to how the Company manages financial assets to generate
cash flow. The business model decides whether the source of cash flow of financial assets managed by the Company
is to collect contract cash flow, sell financial assets or both of them. Based on objective facts and the specific business
objectives of financial assets management decided by key managers, the Company determines the business model of
financial assets management.
The Company evaluates the characteristics of the contract cash flow of financial assets to determine whether the contract
cash flow generated by the relevant financial assets on a specific date is only to pay principal and interest based on
the amount of unpaid principal. Among them, principal refers to the fair value of financial assets at the time of initial
confirmation; interest includes the consideration of time value of money, credit risk related to the amount of unpaid
principal in a specific period, and other basic borrowing risks, costs and profits. In addition, the Company evaluates the
terms and conditions of the contracts that may lead to changes in the time distribution or amount of cash flow in financial
asset contracts to determine whether they meet the requirements of the above contract cash flow’s characteristics.
Only when the Company changes its business model of managing financial assets, all the financial assets affected shall be
reclassified on the first day of the first reporting period after the business model changes, otherwise, financial assets shall
not be reclassified after initial confirmation.
Financial assets are measured at fair value on initial recognition. The relevant transaction cost of financial assets at fair
value through profit or loss is directly recognised in profit or loss for the current period, and that of other types of financial
assets is included in the initially recognised amount. Trade receivables or notes receivable arising from sales of goods
or rendering services, without significant financing component, are initially recognised based on the transaction price
expected to be entitled by the Company.
116 Joincare Pharmaceutical Group Industry Co., Ltd.
(3) Classification and measurement of financial liabilities
On initial recognition, the Company’s financial liabilities are classified into financial liabilities at fair value through profit or
loss and financial liabilities at amortised cost. For financial liabilities not classified as financial liabilities at fair value through
profit or loss, the relevant transaction costs are included in the initially recognised amount.
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities
designated at fair value through profit or loss upon initial recognition. Such financial liabilities are subsequently measured
at fair value, all gains and losses arising from changes in fair value and dividend and interest expense relative to the
financial liabilities are recognised in profit or loss for the current period.
Financial liabilities at amortised cost
Other financial liabilities are subsequently measured at amortised cost using the effective interest method; gains and
losses arising from derecognition or amortisation is recognised in profit or loss for the current period.
Distinction between financial liabilities and equity instruments
The financial liability is the liability that meets one of following criteria:
① Contractual obligation to deliver cash or other financial instruments to another entity.
② Under potential adverse condition, contractual obligation to exchange financial assets or financial liabilities with other
parties.
③ A contract that will or may be settled in the entity’s own equity instruments and is a non-derivative for which the
entity is or may be obliged to deliver a variable number of the entity’s own equity instruments.
④ A derivative that will or may be settled other than by the exchange of a fixed amount of cash or another financial asset
for a fixed number of the entity’s own equity instruments.
An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its
liabilities.
If the Company cannot unconditionally avoid fulfilling a contractual obligation by delivering cash or other financial assets,
the contractual obligation meets the definition of financial liability.
If a financial instrument must or are able to be settled by the Company’s own equity instrument, the Company should
consider whether the Company’s equity instrument as the settlement instrument is a substitute of cash or other financial
assets or the residual interest in the assets of the Company after deducting all of its liabilities. If the former, the tool is the
Company’s financial liability; if the latter, the tool is the equity instrument of the Company.
(4) Derivative financial instruments and embedded derivatives
The Company’s derivative financial instruments include forward foreign exchange contracts, and are initially measured
at fair value on the date of the derivative contract signed and are subsequently measured at fair value. A derivative with
positive fair value shall be recognised as an asset, otherwise that with negative fair value shall be recognised as a liability.
Any profit or loss arising from changes of fair value and not compliance with the accounting provision of hedge shall be
recognised as profit or loss for current period.
lnterim Report 2022 117
For the hybrid instrument which includes embedded derivatives, where the host contract is a financial asset, requirements
in relation to the classification of financial assets shall apply to the hybrid instrument as a whole. Where the host contract
is not a financial asset, and the hybrid instrument is not measured at fair value and its changes are included in the profit
and loss for the current period for accounting purposes, there is no close relation between the embedded derivatives
and the host contract in terms of economic features and risks, and the instrument that has the same condition with the
embedded derivatives and exists independently meets the definition of derivatives, the embedded derivatives shall be
separated from the hybrid instrument and treated as a separate derivative financial instrument. If it is unable to separately
measure the embedded derivatives upon acquisition or on the subsequent balance sheet date, the hybrid instrument
shall be entirely designated as the financial assets or financial liabilities measured at fair value and whose movements are
included in the profit and loss of the current period.
(5) Fair value of the financial instrument
The methods for determining the fair value of the financial assets or financial liabilities are set out in Note III. 11.
(6) Impairment of financial assets
The following items are subject to impairment accounting and recognition of loss allowances based on expected credit
losses:
A. Financial assets measured at amortised cost;
B. Receivables and debt investments that are measured at fair value through other comprehensive income;
C. Contract assets as defined in the Accounting Standard for Business Enterprises No. 14 – Revenue;
D. Lease receivables;
E. Financial guarantee contracts, except for those carried at fair value through profit or loss, those which the transfer of
financial assets does not satisfy the derecognition condition or those formed as a result of continued involvement of
the transferred financial assets.
Measurement of expected credit loss (ECLs)
The ECL is a weighted average of credit losses on financial instruments weighted at the risk of default. Credit loss is the
difference between all receivable contractual cash flows according to the contract and all cash flows expected to be
received by the Company discounted to present value at the original effective interest rate, i.e. the present value of all
cash shortfalls.
The Company takes into account reasonable and valid information on past events, current conditions and forecasts of
future economic conditions, with the risk of default as the weight, to calculate the probabilistic weighted amount of the
present value of the difference between the cash flow receivable from contract and the expected cash flow to be received
and recognise the expected credit loss.
The Company respectively measures the expected credit losses of financial instruments by different stages. If the credit
risk of the financial instrument does not increase significantly since the initial recognition, it would be classified in Stage
1, the Company would measure loss allowance according to the future 12-month expected credit losses. If the credit risk
of a financial instrument has significantly increased since the initial recognition but not yet credit-impaired, it would be
classified in Stage 2, the Company would measure loss allowance according to the lifetime expected credit losses of that
instrument. If the financial instrument has credit-impaired since the initial recognition, it would be classified in Stage 3,
and the Company would measure loss allowance according to the lifetime expected credit losses of that instrument.
118 Joincare Pharmaceutical Group Industry Co., Ltd.
For financial instruments with lower credit risk on the balance sheet date, the Company assumes that its credit risk has
not increased significantly since the initial recognition, and measures loss allowance according to the 12-month expected
credit losses.
Lifetime ECLs are the ECLs that result from all possible default event over the expected life of a financial instrument. Future
12-month ECLs are the portion of ECL that results from default events on a financial instrument that are possible within
the 12 months after the balance sheet date (or the expected life of the instrument, if it is less than 12 months).
The maximum period considered when estimating ECLs is the maximum contractual period over which the Company are
exposed to credit risk (including the option to renew).
For the financial instruments classified in Stage 1 and Stage 2 and those with lower credit risk, the Company would
measure the interest income by the book balance (that is, without deduction for credit allowance) and the effective
interest rate. For financial instruments classified in Stage 3, the Company would measure the interest income by the
amortised cost (that is, book balance less impairment allowance) and the effective interest rate.
For notes receivable, trade receivables and contract assets, regardless whether it has significant financing components or
not, the Company has always measured its loss allowance at an amount equal to lifetime expected credit losses.
If the expected credit losses of one individual financial asset cannot be estimated at a reasonable cost, the Company
classifies notes receivable and trade receivables into portfolios based on credit risk characteristics, and measures expected
credit losses on portfolios basis to determine portfolios by the following basis:
A. Notes receivable
Bills receivable portfolio 1: Bank acceptance bills
Bills receivable portfolio 2: Commercial acceptance bills
B. Accounts receivables
Accounts receivables portfolio 1: Amount due from domestic customers
Accounts receivables portfolio 2: Amount due from overseas customers
Accounts receivables portfolio 3: Receivables of consolidated companies
Contract assets
Contract assets portfolio: Sale of products
For bills receivable classified as portfolio, the Company measures expected credit losses based on the risk exposures of
default and lifetime expected credit losses rate with reference to the historical credit loss experience, current situation and
forecasts of future economic conditions.
For accounts receivables classified as portfolio, the Company measures expected credit losses through preparing a table
of concordance between the aging of trade receivables and lifetime expected credit losses rate with reference to the
historical credit loss experience, current situation and forecasts of future economic conditions.
lnterim Report 2022 119
Other receivables
The Company classifies other receivables into certain portfolios based on credit risk characteristics, and measures expected
credit losses on portfolios basis to determine portfolios by the following basis:
Other receivables portfolio 1: Receivables of export tax refund
Other receivables portfolio 2: Receivables of deposits under guarantee and security deposits and lease expenses
Other receivables portfolio 3: Other receivables
Other receivables portfolio 4: Receivables of consolidated companies
For other receivables classified as portfolio, the Company measures expected credit losses based on the risk exposures of
default and future 12-month or lifetime expected credit losses rate.
Long-term receivables
The Company’s long-term receivables include finance lease receivables and equity transfer receivables.
The Company classifies finance lease receivables and equity transfer receivables into certain portfolios based on credit risk
characteristics, and measures expected credit losses on portfolios basis to determine portfolios by the following basis:
A. Finance lease receivables
Portfolio of finance lease receivables: other receivables
B. Other long-term receivables
Portfolio of other long-term receivables: equity transfer receivables
For finance lease receivables and equity transfer receivables, the Company measures expected credit losses based on the
risk exposures of default and lifetime expected credit losses rate with reference to the historical credit loss experience,
current situation and forecasts of future economic conditions.
For other receivables and long-term receivables other than finance lease receivables and equity transfer receivables that
are classified as portfolio, the Company measures expected credit losses based on the risk exposures of default and future
12-month or lifetime expected credit losses rate.
Debt investments and other debt investments
For debt investments and other debt investments, the Company measures expected credit losses based on the nature of
investments, counterparties and various types of risk exposures and the risk exposures of default and future 12-month or
lifetime expected credit losses rate.
Assessment of significant increase in credit risk
By comparing the risk of default of financial instruments occurring on the balance sheet date and on the initial recognition
date, the Company determines the relative changes in risk of default over the expected life of financial instruments and
assesses whether the credit risk of financial instruments have increased significantly since the initial recognition.
120 Joincare Pharmaceutical Group Industry Co., Ltd.
When determine whether credit risks have significantly increased since the initial recognition, the Company considers
information that is reasonable and supportable, including forward-looking information that is available without undue cost
or effort. The information considered by the Company includes:
Failure to make payments of principal or interest on debtors’ contractually due dates;
An actual or expected significant deterioration in a financial instrument’s external or internal credit rating (if any);
An actual or expected significant deterioration in the operating results of debtors;
Existing or forecast changes in the technological, market, economic or legal environment that have significant adverse
effect on the debtors’ abilities to repay to the Company.
Depending on the nature of the financial instruments, the Company assesses whether credit risks have significantly
increased on either an individual financial instrument basis or a collective financial instrument basis. When the assessment
is performed on a collective financial instrument basis, the Company can classify the financial instruments based on the
shared credit risk characteristics, such as past due information and credit risk ratings.
The Company determines that the credit risk on a financial instrument has increased significantly if it is more than 30 days
past due.
Credit-impaired financial assets
The Company assesses whether financial assets at amortised cost and debt investments measured at fair value through
other comprehensive income are credit-impaired at balance sheet date. A financial asset is ’credit-impaired’ when one or
more events that have an adverse impact on the estimated future cash flows of the financial asset have occurred. Evidence
that a financial asset is credit-impaired includes the following observable information:
Significant financial difficulty of the issuer or debtor;
A breach of contract by debtor, such as a default or delinquency in interest or principal payments;
For economic or contractual reasons relating to the borrower’s financial difficulty, the Company having granted to the
borrower a concession that would not otherwise consider;
It is probable that the borrower will enter bankruptcy or other financial reorganization;
The disappearance of an active market for that financial asset because of financial difficulties.
Presentation of allowance for ECL
The Company re-measures the ECLs on each balance sheet date to reflect changes in the financial instruments’ credit
risk since initial recognition, and the increase or reversal of the loss provision resulted therefrom is recognised as an
impairment gain or loss in profit or loss. For financial assets measured at amortised cost, the loss provision is offset against
their carrying amounts in the balance sheet. For debt investments at FVOCI, the Company recognises the loss provision in
other comprehensive income and does not deduct the carrying amount of the financial assets.
lnterim Report 2022 121
Write-off
The gross carrying amount of a financial asset is written off (either partially or in full) to the extent that there is no realistic
prospect of recovery. A write-off constitutes a derecognition event. This is generally the case the Company determines
that the debtor does not have assets or sources of income that could generate sufficient cash flows to repay the amounts
subject to the write-off. However, financial assets that are written off could still be subject to enforcement activities in
order to comply with the Company’s procedures for recovery of amounts due.
Subsequent recoveries of an asset that was previously written off are recognised as a reversal of impairment in profit or
loss in the period in which the recovery occurs.
(7) Transfer of financial assets
Transfer of financial assets refers to the transfer or delivery of financial assets to the other party (the transferee) other than
the issuer of financial assets.
The Company derecognises a financial asset only if it transfers substantially all the risks and rewards of ownership of the
financial asset to the transferee; the Company should not derecognise a financial asset if it retains substantially all the risks
and rewards of ownership of the financial asset.
The Company neither transfers nor retains substantially all the risks and rewards of ownership, shows as the following
circumstances: if the Company has forgone control over the financial assets, derecognise the financial assets and verify the
assets and liabilities; if the Company retains its control of the financial asset, the financial asset is recognised to the extent
of its continuing involvement in the transferred financial asset and recognise an associated liability is recognised.
(8) Offsetting financial assets and financial liabilities
When the Company has the legal right to offset recognised financial assets and financial liabilities, and the legal right can
be executed at present, and the Company has a plan to settle the financial assets and financial liabilities at the same time
or at net amount, the financial assets and financial liabilities can be presented on the balance sheet after offsetting. Except
for the above circumstances, financial assets and financial liabilities cannot be offset and shall be presented separately on
the balance sheet.
11. Fair value measurement
The fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date.
The Company measures the relevant assets or liability at fair value supposing the orderly transaction of asset selling or
liability transferring incurring in a principal market of relevant assets or liabilities. In the absence of a principal market for
the asset or liability, the Company assumes that the transaction takes place at the most advantageous market of relevant
asset or liability. A principal market (or the most advantageous market) is the transaction market that the Company can
enter into at measurement date. The Company implements the hypothesis used by the market participants to realise the
maximum economic benefit in assets or liabilities pricing.
If there exists an active market for the financial assets or financial liabilities, the Company uses the quotation on the active
market as its fair value. For those in the absence of active market, the Company uses valuation technique to recognise its
fair value. However, under limited circumstances, the Company may use all information about the results and operation
of the investee obtained after the date of initial recognition to determine whether cost represents fair value. Cost may
represent the best estimate of fair value of the relevant financial asset within the scope of distribution, and such cost
represents the appropriate estimate of fair value within the scope of distribution.
122 Joincare Pharmaceutical Group Industry Co., Ltd.
For non-financial assets measured at fair value, the Company should consider the capacity of the market participants
to put the assets into optimal use thus generating the economic benefit, or the capacity to sell assets to other market
participants who can put the assets into optimal use and generate economic benefit.
The Company implements the valuation technique suitable for the current condition and supported by enough available
data and other information, gives priority in use of relevant observable inputs, only the observable inputs cannot be
obtained or impracticable before using unobservable inputs.
For the assets and liabilities measured or disclosed at fair value on financial statements, fair value hierarchies are
categorized into three levels as the lowest level input that is significant to the entire fair value measurement: Level 1:
inputs are quoted prices (unadjusted) in active markets for identical assets and liabilities. Level 2: inputs are inputs other
than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3:
inputs are unobservable inputs for the asset or liability.
At each balance sheet date, the Company re-evaluates the assets and liabilities recognised to be measured at fair value on
the financial statements to make sure whether conversion occurs between fair value hierarchies.
12. Inventories
√ Applicable □ N/A
(1) Classification of inventories
The Company’s inventories include raw materials, packaging materials, finished goods, work-in-progress, low-value
consumables, subcontracting materials, inventory goods and expendable biological assets.
(2) Method of costing
The method of costing of the Company’s inventories: Cost of finished goods are measured at planned cost, and material
cost differences are carried forward at the end of the period to adjust planned cost to actual cost; other inventories are
measured at actual cost on acquisition and raw materials received are accounted for by the weighted-average method;
low-value consumables and packaging materials are amortised in full upon the use.
(3) Method in the determination and the basis of provision for diminution in net realisable value of inventories
On the balance sheet date, the inventories are calculated at the lower of cost and the net realisable value. When the
net realisable value is lower than the cost, the provision for diminution in value of inventories is made on an item-by-
item basis at the excess of the cost of the inventory over its net realisable value. For large volume inventories with low
unit price, the provision for diminution in the value of inventories is made by categories. Inventories that are related to a
product line manufactured and sold in the same region, have the same or similar end use or purpose, and are difficult to
measure separately from other items are consolidated the provision for diminution in the value of inventories.
(4) Inventory system
The Company maintains a perpetual inventory system.
(5) Amortisation methods of consumables
Low-value consumables and packaging materials of the Company are amortised in full when used.
lnterim Report 2022 123
13. Assets held for sale
√ Applicable □ N/A
(1) Category and measurement of non-current assets or the disposal group held for sale
Non-current assets and disposal groups are classified as held for sale if the Company recovers its book value mainly by
selling (including the exchange of nonmonetary assets with commercial substance) rather than continuing to use it.
The aforesaid non-current assets do not include investment property measured with the basis of fair value; the biological
assets measured with the basis of fair value less selling costs; the assets formed by employee benefits; financial assets and
the right arising from deferred income tax assets and insurance contracts.
A disposal group is a group of assets to be disposed through sale or other means as a whole in a single transaction, and
liabilities directly associated with those assets that will be transferred in the transaction. In certain circumstance, disposal
groups include the goodwill obtained through business combination.
Non-current assets and disposal groups that meet the following conditions are classified as held for sale: according to the
practice of disposing of this type of assets or disposal groups in a similar transaction, a non-current asset or disposal group
is available for immediate sale at its present condition; the sale is likely to occur, that is, a decision has been made on a sale
plan and a determined purchase commitment is made, and the sale is expected to be completed within one year. Where
the loss of control over the subsidiaries is due to the sales of investment in subsidiaries, no matter whether the Company
retains part of the equity investment after selling or not, the investment in subsidiaries shall be classified as held for sale
in the separate financial statements when it satisfies the conditions for category of held for sale; all assets and liabilities of
subsidiaries shall be classified as held for sale in the consolidated financial statements.
The difference between carrying amount of non-current assets or disposal groups classified as held for sale and the net
amount of fair value less selling costs shall be recognised as impairment loss on assets upon initial measurement or when
such noncurrent assets or disposal groups are remeasured at the balance sheet date. For the amount of impairment loss
on assets recognised in disposal groups, the carrying amount of disposal groups’ goodwill shall be offset against first,
and then offset against the carrying amount of non-current assets according to the proportion of carrying amount of the
individual non-current assets in the disposal groups.
If on a subsequent balance sheet date, the net amount of the fair value of a held-for-sale disposal group less its selling
costs increases, the amount reduced previously shall be recovered, and reversed in the asset impairment loss recognised
on the noncurrent asset which is applicable to the measurement requirements of Held-For-Sale Standards after the non-
current asset is classified into held-for-sale category. The reversed amount is credited to current profit or loss. The carrying
value of goodwill which has been offset cannot be reversed.
No depreciation or amortisation is provided for the non-current assets in the held-for-sale and the assets in the disposal
group held for sale. The interest on the liabilities and other costs in the disposal group held for sale is recognised
continuously. As far as all or part of investment in the associates and joint ventures is concerned, for the part classified into
the held-for-sale category, the accounting with equity method shall be stopped, while the remaining part (which is not
classified into the held for – sale category) shall still be accounted for using the equity method. When the Company loses
the significant influence on the associates and joint venture due to the sale, the use of equity method shall be ceased.
124 Joincare Pharmaceutical Group Industry Co., Ltd.
When certain non-current asset or disposal group classified into the held-for-sale category no longer meets the
classification criteria for held-for-sale category, the Company shall stop classifying it into the held-for-sale category and
measure it according to the lower of the following two amounts:
① The carrying amount of the asset of disposal group before it was classified into the held-for-sale category after being
adjusted with the depreciation, amortisation or impairment that could have been be recognised if it was not classified
into the held-for-sale category;
② The recoverable amount.
(2) Discontinued operation
Discontinued operation refers to the component meeting one of the following conditions that has been disposed of by
the Company or classified by the Company into the held-for-sale type and can be identified separately:
① The component represents an independent principal business or a separate principal business place.
② The component is a part of the related plan for the contemplated disposal of an independent principal business or a
separate principal business place.
③ The component is a subsidiary acquired exclusively for the purpose of resale.
(3) Presentation
The Company presents the non-current assets held for sale and the assets in the disposal group held for sale under “assets
classified as held for sale”, and the liabilities in the disposal group held for sale under “liabilities classified as held for sale” in
the balance sheet.
The Company presents the profit and loss for continuing operation and profit and loss for discontinued operation in the
income statement, respectively. The impairment loss and reversal amount and disposal profit and loss of the non-current
assets held for sale or disposal group not meeting the definition of discontinued operation will be presented as the profit
and loss of continuing operation. The operating profit and loss (such as impairment loss and reversal amount) and disposal
profit and loss of the discontinued operation will be presented as the profit and loss of the discontinued operation.
The disposal group proposed for retirement rather than sale and meeting the condition about the relevant component in
the definition of the discontinued operation will be presented as discontinued operation from the date of retirement.
For the discontinued operation reported in the current period, the information formerly presented as profit and loss of
continuing operation will be presented as the profit and loss of discontinued operation for the comparable accounting
period in the financial statement of the current period. If the discontinued operation no longer meets the classification
criteria for held for – sale category, the information formerly presented as profit and loss of discontinued operation will be
presented as the profit and loss of continuing operation for the comparable accounting period in the financial statement
of the current period.
lnterim Report 2022 125
14. Long-term equity investment
√ Applicable □ N/A
The long-term equity investment includes the equity investment in the subsidiary, joint ventures and associates. The
investee over which the Company has significant influence is the associates of the Company.
(1) Determination of initial investment cost
The long-term equity investment resulting from corporate merger: For the long-term equity investment resulting from
merger of companies under the same control, the carrying amount of the ownership equity of the merged party obtained
on the merger date presented in the consolidated financial statement of the final controlling party will be used as the
investment cost. For the long-term equity investment resulting from merger of companies under different controls, the
merger cost will be used as the investment cost of the long-term equity investment.
The long-term equity investment obtained by other means: For the long-term equity investment obtained by paying cash,
the actually paid purchase price will be used as the initial investment cost. For the long term equity investment obtained
by issuing equity securities, the fair value of the issued equity securities will be used as the initial investment cost.
(2) Subsequent measurement and recognition method of profit or loss
The investment in subsidiary will be accounted for using cost method, unless the investment meets the criteria of held-
for-sale category. The investment in associates and joint venture will be accounted with equity method.
For the long-term equity investment accounted for using cost method, except for the price actually paid upon the
investment or the cash dividend or profit in the consideration that has been declared but not released, the cash dividend
or profit declared and distributed by the investee is recognised as the investment income and recorded into the profit and
loss for the current period.
For the long-term equity investment accounted for using equity method, the investment cost of the long-term equity
investment shall not be adjusted if the initial investment cost of the long-term equity investment is higher than the
Company’s share in the fair value of the identifiable net value of the investee at the time of investment; if the initial
investment cost of the long-term equity investment is lower than the Company’s share in the fair value of the identifiable
net value of the investee at the time of investment, the carrying amount of the long-term equity investment will be
adjusted, with the difference recorded into the profit and loss for the current period of investment.
When accounted for using the equity method, return on investment and other comprehensive income are recognised
according to the share in the investee’s realised net profit or loss and other comprehensive income respectively, and the
carrying amount of the long-term equity investment is adjusted. The carrying amount of the long-term equity investment
will be deducted according to the profit distribution declared by the investee or cash dividend attributable to the
Company. The carrying amount of long term equity investment will be adjusted for changes to equity interest attributable
to the owners of the investee other than net profit or loss, other comprehensive income and profit distribution, and
recorded into capital reserve (other capital reserve). The Company’s share of the net profit or loss of the investees will be
recognised after adjustment of the net profit of the investees according to the accounting policy and accounting period of
the Company on the basis of fair value of all identifiable assets of the investee on acquisition.
If the Company is able to exert significant influence or implement joint control (which does not constitute control) on
the investee through additional investment or other reason, the sum of the fair value of the original equity plus the
additional investment cost will be used as the initial investment cost, which will be accounted for with equity method, on
the conversion date. The difference between the fair value of the original equity on the conversion date and its carrying
amount, and the accumulated change of fair value recorded into other comprehensive income will be transferred into the
profit and loss for the current period, which will be accounted for using equity method.
126 Joincare Pharmaceutical Group Industry Co., Ltd.
If an entity loses joint control or has no significant influence over investees due to the elimination of parts of the equity
investment, the surplus equity after disposal shall be recognised in accordance with “Accounting Standards for Business
Enterprises No. 22 – Recognition and Measurement of Financial Instruments”, and the difference between fair value and
carrying amount should be recognised as profit or loss for current period. Other comprehensive income of original equity
investment recognised under equity method shall be recognised in accordance with the same foundation used by the
investees when dispose the relevant assets or liabilities directly in the termination of equity method. Other changes of
owners’ equity related to the original equity investment shall be transferred into profit or loss for current period.
If an entity loses control over investees due to the elimination of parts of the equity investment, the surplus owners’ equity
that is able to implement joint control or have significant influence over investees shall be measured at equity method
and are deemed to be recognised under equity method since the acquisition date. The surplus owners’ equity that are
unable to implement joint control or have no significant influence over investees shall be processed in accordance with
“Accounting Standards for Business Enterprises No. 22 – Recognition and Measurement of Financial Instruments”, and the
difference between fair value and carrying amount at the day of loss of control shall be recognised as profit or loss for
current period.
If the shareholding ratio of the Company is reduced due to the increase of capital of other investors, and thus the control
is lost, but the joint control or significant influence can be exerted on the invested entity, the Company should recognise
net asset according to the new shareholding ratio. The difference between the original book value of the long-term equity
investment corresponding to the decrease in the shareholding ratio should be included in the current profit and loss; then,
according to the new shareholding ratio, the equity method is used to adjust the investment.
The Company recognises the unrealised profit or loss of intra-transaction between the joint ventures or associates that
belongs to itself according to the proportion of the shares and recognises the investment income or loss after offset.
However, the loss arising from the unrealised intra-transaction between the Company and investees, which belongs to the
impairment loss of assets transferred, cannot be offset.
(3) Basis of determining common control and significant influence on the investee
Joint control is the contractually agreed sharing of control over an arrangement under which the decisions relating to any
activity require the unanimous consent of the parties sharing control. In determining whether there is a joint control, the
first judge is to determine whether the relevant arrangement is controlled collectively by all the parties involved or the
group of the parties involved. Secondly, and then determine whether the decisions related to the basic operating activities
should require the unanimous consent of the parties involved. If the parties involved or the group of the parties involved
must act consistently to determine the relevant arrangement, it is considered that the parties involved or the group of the
parties involved control the arrangement. If two or more parties involve in the collectively control of certain arrangement,
it shall not be considered as joint control. Protection of rights shall not be considered in determining whether there is joint
control.
Significant influence refers to the power to participate in the decision making process for financial and operational policies
of the investees without control or common control over the formulation of such policies. When determining whether it
has significant influence over the investee, the influence of the voting shares of the investee held by the investor directly
and indirectly and the potential voting rights held by the investor and other parties which are exercisable in the current
period and converted to the equity of the investee, including the warrants, stock options and convertible bonds that are
issued by the investee and can be converted in the current period, shall be taken into account.
lnterim Report 2022 127
When the Company owns directly or indirectly through its subsidiaries more than 20% (including 20%) but less than 50%
of the voting shares of the investee, it is generally considered to have significant influence over the investee, unless there
is clear evidence that it cannot participate in the production and operation decisions of the investee and does not have a
significant influence under such circumstances. When the Company owns less than 20% (excluding) of the voting shares
of the investee, it is generally not considered to have significant influence on the investee unless there is clear evidence
that it can participate in the production and operation decisions of the investee and have significant influence under such
circumstances.
(4) Held-for-sale equity investment
Refer to Note III. 13 for the relevant accounting treatment of the equity investment to joint ventures or associates all or
partially classified as assets held for sale.
The surplus equity investments that are not classified as assets held for sale shall be accounted for using equity method.
The equity investment to joint ventures or associates already classified as held for sale no longer meets the conditions of
assets held for sale shall be adjusted retroactively using equity method from the date of being classified as assets held for
sale.
(5) Impairment test and impairment provision
Refer to note III. 22 for investment to subsidiaries, associates and joint ventures and the impairment provision of assets.
15. Investment properties
Investment properties are properties held to earn rental or capital appreciation or both. The investment properties of the
Company include land use rights that have already been leased out, land use rights that are held for the purpose of sale
after capital appreciation, buildings that have already been leased out, etc.
Investment properties of the Company are measured initially at cost upon acquisition, and subject to depreciation or
amortisation in the relevant periods according to the relevant provisions on fixed assets or intangible assets.
The Company adopts the cost model for subsequent measurement of the investment properties. The method for asset
impairment provision is set out in note III. 22.
The balance after the disposal income from the disposal, transfer, scrapping or destruction of the investment properties
deducts the book value and the relevant taxes shall be recorded into the profit and loss for the current period.
16. Fixed assets
(1) Conditions for recognition of fixed assets
√ Applicable □ N/A
The Company’s fixed assets represent the tangible assets held by the Company using in the production of goods,
rendering of services, rent and for operation and administrative purposes with useful life over one year.
The fixed asset can be recognised only when the economic benefit related to the fixed asset is probable to flow into the
company and the cost of the fixed asset can be reliably measured.
The Company’s fixed assets are initially measured at the actual cost at the time of acquisition.
128 Joincare Pharmaceutical Group Industry Co., Ltd.
(2) Method of depreciation
√ Applicable □ N/A
Category Useful years (year) Residual rate % Annual depreciation
Properties and Buildings 20 5%-10% 4.5%-4.75%
Machine and equipment 10 5%-10% 9%-9.5%
Transportation equipment 5 5%-10% 18%-19%
Electric equipment and others 5-10 5%-10% 18%-19%
Where, for the fixed assets for which depreciation provision is made, to determine the depreciation rate, the accumulated
amount of the fixed asset depreciation provision that has been made shall be deducted.
(3) Refer to note III. 22 for the impairment testing and the impairment provision of fixed assets.
(4) Recognition basis, valuation and depreciation method of financial leased fixed assets
When the Company’s leased fixed assets meet one or more of the following criteria, it is recognized as finance leased fixed
assets:
① At the expiration of the lease term, the ownership of the leased assets is transferred to the Company.
② The Company has the option to purchase leased assets. The agreed purchase price is expected to be much lower than
the fair value of the leased asset when the option is exercised. Therefore, it can be reasonably determined that the
Company will exercise this option on the lease start date.
③ Even if the ownership of the asset is not transferred, the lease term occupies most of the useful life of the leased asset.
④ The present value of the Company’s minimum lease payment on the lease start date is almost equivalent to the fair
value of the leased assets on the lease start date.
⑤ The leased assets are of special nature, and only our company can use them if they don’t undergo major
transformation.
For fixed assets leased by finance leases, the lower of the fair value of the leased assets on the lease start date and the
present value of the minimum lease payment shall be the entry value. The minimum lease payment is taken as the entry
value of the long-term payable, and the difference is taken as the unrecognized financing expense. In the process of lease
negotiation and signing of the lease contract, the initial direct costs attributable to the lease item, such as handling fees,
attorney fees, travel expenses, stamp duty, etc., are included in the value of the leased asset. The unrecognized financing
costs shall be amortized by the effective interest method during each period of the lease term.
The fixed assets acquired by finance lease adopt the same policy as self-owned fixed assets to calculate the depreciation
of leased assets. If it can be reasonably determined that the ownership of the leased asset will be obtained at the end of
the lease term, depreciation shall be accrued on the useful life of the leased asset; if it cannot be reasonably determined
that the ownership of the leased asset will be obtained at the end of the lease term, depreciation is accrued in the shorter
of the lease period and the useful life of the leased asset.
lnterim Report 2022 129
(5) The Company reviews the useful life and estimated net residual value of fixed asset and the depreciation method applied
annually at each of the period end.
The useful lives of fixed asset are adjusted if their expected useful lives are different from the original estimates; the
estimated net residual values are adjusted if they are different from the original estimates.
(6) Overhaul costs
The overhaul costs occurred in regular inspection of fixed assets are recognised in the cost of property, plant and
equipment if there is undoubted evidence to confirm that they meet the recognition criteria of fixed assets, otherwise,
the overhaul costs are recognised in profit or loss for the current period. Property, plant and equipment are depreciated
during the intervals of the regular overhaul.
17. Construction in progress
√ Applicable □ N/A
Construction in progress is measured at actual cost. Actual cost comprises necessary project expenditure incurred during
construction, borrowing cost that are eligible for capitalisation and other necessary cost incurred to bring the fixed assets
ready for their intended use.
Construction in progress is transferred to fixed assets when the assets are ready for their intended use.
For provision for impairment of construction in progress, refer to note III. 22.
In the balance sheet, the ending balance of construction materials is presented under “construction in progress”.
18. Borrowing costs
√ Applicable □ N/A
(1) Recognition principle of capitalisation of borrowing costs
For borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset,
they shall be capitalised and included in the cost of related assets; other borrowing costs are recognised as expenses
and included in profit or loss when incurred. Capitalisation of such borrowing costs can commence only when all of the
following conditions are satisfied:
① Expenditures for the asset incurred, capital expenditure includes the expenditure in the form of cash payment, transfer
of non-cash assets or the interest bearing liabilities for the purpose of acquiring or constructing assets eligible for
capitalisation;
② Borrowing costs incurred;
③ Activities relating to the acquisition, construction or production of the asset that are necessary to prepare the asset for
its intended use or sale have commenced.
(2) Capitalisation period of borrowing costs
Capitalisation of such borrowing costs ceases when the qualifying assets being acquired, constructed or produced become
ready for their intended use or sale. The borrowing cost incurred after that is recognised as an expense in the period in
which they are incurred and included in profit or loss for the current period.
Capitalisation of borrowing costs is suspended during periods in which the acquisition, construction or production of a
qualifying asset is interrupted abnormally and when the interruption is for a continuous period of more than 3 months; the
borrowing costs in the normally interrupted period continue to capitalise.
130 Joincare Pharmaceutical Group Industry Co., Ltd.
(3) Calculation of the capitalisation rate and amount of borrowing costs
The interest expense of the specific borrowings incurred at the current period, deducting any interest income earned from
depositing the unused specific borrowings in bank or the investment income arising from temporary investment, shall
be capitalised. The capitalisation rate of the general borrowing is determined by applying the weighted average effective
interest rate of general borrowings, to the weighted average of the excess amount of cumulative expenditures on the
asset over the amount of specific borrowings.
During the capitalisation period, exchange differences on foreign currency special borrowings shall be capitalised;
exchange differences on foreign currency special borrowings shall be recognised as current profits or losses.
19. Biological assets
√ Applicable □ N/A
(1) Determination of biological assets
Biological assets refer to assets comprising living animals and plants. No biological asset shall be recognised unless it
meets the conditions as follows simultaneously:
① An enterprise possesses or controls the biological asset as a result of past transaction or event;
② The economic benefits or service potential concerning this biological asset are likely to flow into the enterprise;
③ The cost of this biological asset can be measured reliably.
(2) Classification of biological assets
The Company’s biological assets are consumable biological assets which include traditional Chinese medical herbal plant
species.
The consumable biological assets refer to the biological assets held for sale, or biological assets to be harvested as
agricultural products in the future, consisting of growing traditional Chinese medical herbal plant species. The consumable
biological asset is initially measured at cost. The cost of any consumable biological assets by way of self-planting, self-
cultivating, self-breading is the necessary cost directly attributable to this asset prior to the harvest, consisting of
borrowing costs that meet the conditions of capitalisation. The subsequent expenses for the maintenance, protection and
cultivation of a consumable biological asset after the harvest shall be included in the current profits or loss.
The cost of a consumable biological asset shall, at the time of harvest or sale, be carried over at its book value by the
weighted average method.
(3) Impairment of biological assets
If the net realisable value of the consumable biological assets is lower than their carrying amount, provision of impairment
loss is made and recognised in the profit or loss for the current period as the excess of the carrying amount over the
net realisable value. If the factors affecting the impairment of consumable biological assets no longer exist, the amount
of write-down shall be resumed and shall be reversed from the original provision for the impairment loss before being
recognised in the profit or loss for the current period.
lnterim Report 2022 131
20. Intangible assets
(1) Pricing methods, useful lives and impairment tests
√ Applicable □ N/A
An intangible asset is an identifiable non-monetary asset without physical substance owned or controlled by the Company.
An intangible asset is recognised only when all of the following conditions are satisfied: It is probable that the economic
benefits associated with the intangible assets will flow to the enterprise; The cost of the intangible asset can be reliably
measured. Intangible assets are initially measured at actual cost.
The Company’s intangible assets include land use rights, patents and proprietary technologies, software, trademark rights,
etc.
Intangible assets are initially measured at historical cost, and the Company shall make judgement to determine the useful
life of intangible assets upon acquisition. Intangible assets with finite useful life are amortised in the profit or loss over
the estimated useful life, using the method that reflects the expected realisation of economic benefits associated with
the asset, and if the expected realisation cannot be reliably determined, it is amortised using the straight-line method.
Intangible assets with indefinite useful life is not amortised.
Amortisation of intangible assets with finite useful life is as follows:
Category Expected useful life
Land use rights Useful life specified in the land use right certificate
Patent and technical know-how Protection period or benefit period stipulated by relevant national laws and regulations
Trademark rights Ten years
Others Benefit period
The useful life for an intangible asset with a finite useful life and the method of amortisation are reviewed at least once
at the end of each financial year. If the useful life and amortisation method for the intangible assets are different from the
previous estimate, the change of amortisation is recognised prospectively as the change of accounting estimate.
When the Company estimates an intangible asset can no longer bring future economic benefits to the Company at the
end of a period, the carrying amount in which should be reversed to profit or loss for the current period.
Please refer to note III. 22 for the provision of impairment of intangible assets.
21. Research and development expenditures
√ Applicable □ N/A
Expenditures on an internal research and development project are classified into expenditures on the research phase and
expenditures on the development phase.
Expenditures on the research phase shall be recognised in profit or loss for the current period when incurred.
Expenditures on the development phase will be capitalised only when all of the following conditions are satisfied: it is
technically feasible to complete the intangible asset so that it will be available for use or sale; the Company intends to
complete the intangible asset and use or sell it; it can be demonstrated how the intangible asset will generate economic
benefits, including proving that the intangible assets or the products produced by it will have markets, or the intangible
assets for internal use will be useful; there are adequate technical, financial and other resources to complete the
development and the Company is able to use or sell the intangible assets; and expenditures on the development phase
attributable to the intangible assets can be reliably measured. The development expenditures that do not satisfy the above
conditions shall be recognised in profit or loss for the current period.
132 Joincare Pharmaceutical Group Industry Co., Ltd.
Our research and development projects enter the development stage after meeting the above conditions and forming the
project through the technical and economic feasibility studies.
Capitalised expenditures on the development phase are shown as development expenditures on the balance sheet and
reclassified as intangible assets on the date the project meets the intended purpose.
Capitalisation conditions for specific research and development projects are as follows:
① For research and development projects that are not required to obtain clinical approvals, the period from the
beginning of research and development to the pilot phase is treated as the research phase, and all expenditures
shall be recognised in profit or loss for the current period when incurred; the period from the pilot phase to the
obtaining of production approvals is treated as the development phase, and all expenditures shall be recognised as
development expenditures and reclassified as intangible assets after the obtaining of production approvals.
② For research and development projects that require clinical approval, the period from the beginning of research and
development to the obtaining of clinical approval is treated as the research phase, and all expenditures incurred
shall be recognised in profit or loss for the current period when incurred; the period from the obtaining of clinical
approval to the obtaining of production approval is treated as the development phase, and the expenditures shall
be recognised as development expenditures and reclassified as intangible assets after the obtaining of production
approval.
③ External technology transfer fees and the cost of purchasing clinical approvals can be recognised directly as
development expenditures, and subsequent expenditures are accounted for in accordance with ① and ② above.
④ The Company reviews the latest research and development status of each project at the end of each year and if the
research and development project no longer qualifies for the development stage, the corresponding development
expenditure are recognised in profit or loss for the current period.
⑤ Where it is impossible to differentiate the expenditures on the research phase and the expenditures on the
development phase, all the research and development expenditures are recognised in profit or loss for the current
period.
Please refer to note III. 22 for the impairment testing methodology and impairment provision for intangible assets.
22. Impairment of assets
√ Applicable □ N/A
The impairment of subsidiaries, associates and joint ventures in the long-term equity investments, investment properties
subsequently measured at cost, fixed assets, construction in progress, right-of-use assets, intangible assets, etc. (Excluding
inventories, investment properties measured at fair value, deferred income tax assets and financial assets) are determined
as follows:
At the balance sheet date, the Company determines whether there may be evidence of impairment, if there is any, the
Company will estimate the recoverable amount for impairment, and then test for impairment. For goodwill arising from a
business combination, intangible assets with indefinite useful life and the intangible assets that have not yet ready for use
are tested for impairment annually regardless of whether such evidence exists.
The recoverable amount of an asset is determined by the higher amount of fair value deducting disposal costs and net
present value of future cash flows expected from the assets. The Company estimates the recoverable amount based on
individual asset; for individual asset which is difficult to estimate the recoverable amount, the recoverable amount of the
asset group is determined based on the asset group involving the asset. The identification of the asset group is based on
whether the cash flow generated from the asset group is independent of the major cash inflows from other assets or asset
groups.
lnterim Report 2022 133
When the asset or asset group’s recoverable amount is lower than its carrying amount, the Company reduces its carrying
amount to its recoverable amount, the reduced amount is included in profit or loss, while the provision for impairment of
assets is recognised.
In terms of impairment test of the goodwill, the carrying amount of the goodwill, arising from business combination, shall
be allocated to the related asset group in accordance with a reasonable basis at acquisition date. Those that are difficult
to be allocated to related assets shall be allocated to related asset group. Related assets or assets group refer to those
that can benefit from the synergies of business combination and are not larger than the Company’s recognised reporting
segment.
When there is an indication that the asset and asset group are prone to impair, the Company should test for impairment
for asset and asset group excluding goodwill and calculate the recoverable amount and recognise the impairment loss
accordingly. The Company should test for impairment for asset or the asset group including goodwill and compare the
asset or asset group’s recoverable amount with its carrying amount, provision for impairment of assets shall be recognised
when the recoverable amount of assets is lower than its carrying amount.
Once impairment loss is recognised, it cannot be reversed in subsequent accounting periods.
23. Long-term deferred expenses
√ Applicable □ N/A
The Company’s long-term deferred expenses measured at cost actually incurred and evenly amortised on straight-line
basis over the expected beneficial period. For the long-term deferred expense items that cannot benefit in subsequent
accounting period, their amortised value is recognised through profit or loss.
24. Employee compensation
(1) The scope of employee compensation
Employee compensation are all forms of remuneration and compensation given by the Company in exchange for service
rendered by employees or the termination of employment. Employee compensation include short-term employee
compensation, post-employment benefits, termination benefits and other long-term employee benefits. Employee
compensation include benefits provided to employees’ spouses, children, other dependants, survivors of the deceased
employees or to other beneficiaries.
According to liquidity, employment compensations are presented separately as “accrued payroll” item and “long-term
employment compensation payable” item in the balance sheet.
(2) Short-term employee compensation
√ Applicable □ N/A
During the accounting period in which the employees render the related services, wages, bonuses, social security
contributions (including medical insurance, injury insurance, maternity insurance, etc.) and house funding are recognised
as liability and included in the profit or loss for the current period or related asset costs. If the liability cannot be wholly
settled within twelve months after the end of the annual reporting period in which the employees render the related
service and have significant financial impact, the liability shall be measured as the discounted amounts.
134 Joincare Pharmaceutical Group Industry Co., Ltd.
(3) Post-employment benefits
√ Applicable □ N/A
Post-employment benefit plans mainly includes defined contribution plans and defined benefit plans. Defined contribution
plans include the basic pension insurance, unemployment insurance, etc., and the contributions to defined contribution
plans are recognised and included in profit or loss for the current period or related asset costs.
(4) Termination benefits
√ Applicable □ N/A
The liability of employee compensation arising from termination benefits is recognised and included in profit or loss for
the current period in the earlier date of the followings: The Company cannot unilaterally withdraw the offer of termination
benefits because of an employment termination plan or a curtailment proposal; the Company recognises costs or
expenses related to the restructuring that involves the payment of termination benefits.
For the implementation of the internal retirement plan for employees, the economic compensation before the official
retirement date is a termination benefit. The wage of and social insurance contributions for the internally retired employee
which would have incurred from the date on which the employee cease rendering services to the Company to the
scheduled retirement date will be included in the profit or loss for the current period. Economic compensation after the
official retirement date (such as normal pension) should be treated as post-employment benefits.
(5) Other long-term employee benefits
√ Applicable □ N/A
When other long-term employee benefits provided to the employees by the Company are satisfied the conditions of a
defined contribution plan, those benefits shall be accounted for in accordance with the relevant provisions of the above
defined contribution plans. When the benefits are satisfied the conditions of a defined benefit plan, those benefits shall
be accounted for in accordance with the relevant provisions of the above defined benefit plans, except that the “change
in remeasurement of the net liability or net assets of the defined benefit plans” in the cost of the related employee
compensation shall be included in profit or loss for the current period or related asset costs.
25. Provision for liabilities
√ Applicable □ N/A
An obligations related to a contingency is recognised as a provision when all of the following conditions are satisfied:
(1) The obligation is a present obligation of the Company;
(2) It is probable that an outflow of economic benefits will be required to settle the obligation;
(3) The amount of the obligation can be measured reliably.
Provisions are initially measured at the best estimate of the payment to settle the associated obligations and consider the
relevant risk, uncertainty and time value of money. If the impact of time value of money is significant, the best estimate
is determined as its present value of future cash outflow. The Company reviews the carrying amount of provisions at the
balance sheet date and adjusts the carrying amount to reflect the best estimate.
If the expenses for clearing of provisions is fully or partially compensated by a third party, and the compensated amount
can be definitely received, it is recognised separately as asset. The compensated amount recognised shall not be greater
than the carrying amount of the liability recognised.
lnterim Report 2022 135
26. Share-based payment and equity instruments
√ Applicable □ N/A
(1) Accounting treatment of share-based payment
Share-based payments are transactions in which equity instruments are granted or liabilities are assumed on the basis
of equity instruments in order to obtain services from employees or other parties. Share-based payment is classified into
equity-settled share-based payment and cash-settled share-based payment.
① Equity-settled share-based payment
Equity-settled share-based payment is measured at the fair value of the equity instruments granted to employees. If
vesting is conditional upon completion of services in the pending period or fulfilment of performance conditions, at each
balance sheet date during the pending period, based on the best estimates of the number of vested equity instruments,
the services received for the period are recognised as the costs or expenses on a straight-line basis. Instruments which are
vested immediately upon the grant are included in relevant costs or expenses at the fair value of equity instruments on
the date of grant and capital reserves are increased accordingly.
At each balance sheet date during the pending period, the Company makes the best estimate and revises the number
of equity instruments expected to be exercisable based on subsequent information such as changes in the number of
exercisable employees obtained from the latest available information. The effect of the above estimates is recognised as
the relevant cost or expense in the current period, and capital surplus is adjusted accordingly.
For the equity instruments granted under an equity-settled share-based payment for services from other parties, if the fair
value of services received from other parties can be measured reliably, the fair value of the equity instruments is measured
at the fair value of services from other parties on the grant date; if the fair value of services received from other parties
cannot be measured reliably but the fair value of the equity instruments can be measured reliably, the fair value of the
equity instruments on the date on which services are received shall be recognised as related costs or expenses, with a
corresponding increase in owners’ equity.
② Cash-settled share-based payment
Cash-settled share-based payments are measured at the fair value of the liabilities (share-based or other equity instrument-
based) assumed by the Company. Instruments which are vested immediately upon the grant are included in relevant
costs or expenses at the fair value of liabilities assumed by the Company on the date of grant and liabilities are increased
accordingly. If vesting is conditional upon completion of services in the pending period or fulfilment of performance
conditions, at each balance sheet date during the pending period, based on the best estimates of the vesting situation,
the services received for the period are recognised as the costs or expenses and corresponding liabilities at fair value of
the liabilities assumed by the Company.
At each balance sheet date and settlement date before the relevant liabilities are settled, the fair value of liabilities is re-
measured and the resulting changes are included in the profit and loss for the current period.
(2) Accounting treatment for amendment and termination of share-based payments
When the Company modifies the share-based payment plan, and if such modification increases the fair value of the equity
instruments granted, the increase in services received will be recognised accordingly following the increase in fair value
of the equity instruments; if such modification increases the number of equity instruments granted, the increase in fair
value of the equity instruments is recognised as a corresponding increase in service achieved. The increase in fair value of
the equity instruments refers to the difference in fair value on the date of modification before and after the modification
in respect of the equity instruments. If the modification reduces the total fair value of the share-based payments or
adopts any form that is unfavorable to employees to modify the terms and conditions of the share-based payment plan,
accounting treatment will be continued to be conducted in respect of the services received and the modification will be
deemed to have never occurred, unless the Company had cancelled part or all of the equity instruments granted.
136 Joincare Pharmaceutical Group Industry Co., Ltd.
During the pending period, if the equity instruments granted are cancelled (except for failure to meet the non-market
conditions of the vesting conditions), the Company will undertake an accelerated vesting in respect of the cancelled equity
instruments that had been granted, include the remaining amount that shall be recognised during the pending period in
the current profit and loss immediately and recognise capital reserve accordingly. Where employees or other parties are
permitted to choose to fulfil non-vesting conditions but have not fulfilled during the pending period, the Company will
treat the granted equity instruments as cancelled.
(3) Accounting treatment for share-based payments involving the Company and the shareholders or the de facto controller of
the Company
For share-based payment transactions involving the Company and the shareholders or the de facto controller of the
Company, the settlement enterprise and the enterprise receiving services (one under the Company while another external
to the Company) shall follow the requirements below to conduct accounting treatment in the Company’s consolidated
financial statements:
① For settlement enterprises settling through their own equity instruments, such share-based payment transaction will be
treated as equity-settled share-based payment; except for this, such share-based payment transaction will be treated as
cash-settled share-based payment.
Where a settlement enterprise is an investor of an enterprise receiving services, the fair value of the equity instruments on
the date of grant or the fair value of the liabilities that shall be assumed are recognised as long-term equity investment in
the enterprise receiving services, at the same time, capital reserve (other capital reserve) or liabilities are recognised.
② Where an enterprise receiving services has no settlement obligations or grants its own equity instruments to employees,
such share-based payment transaction will be treated as equity-settled share-based payment; where an enterprise
receiving services has settlement obligations and grants equity instruments (other than its own) to employees, such share-
based payment transaction will be treated as cash-settled share-based payment.
For a share-based payment transaction occurring among enterprises under the Company where the enterprise receiving
services and the settlement enterprise are not the same enterprise, such share-based payment transaction shall be
recognised and measured in each of the respective financial statements of the enterprise receiving services and the
settlement enterprise by reference to the above principles.
27. Preferred shares, perpetual bonds and other financial instruments
√ Applicable □ N/A
(1) Classification of financial liabilities and equity instruments
The Company classifies the financial instrument or its components as financial assets, financial liabilities or equity
instruments at the initial recognition based on the contract terms of the issued financial instrument and the economic
substance it reflects, instead of only in legal form, and combine the definition of financial assets, financial liabilities and
equity instruments.
(2) Accounting treatment of preferred shares, perpetual bonds and other financial instruments
The financial instruments issued by the Company are initially recognised and measured in accordance with the
financial instrument standards; thereafter, interest or dividends are accrued or distributed on each balance sheet date
and processed in accordance with relevant specific accounting standards for enterprises. That is, on the basis of the
classification of the financial instrument issued, the accounting treatment of interest expenses or dividend distributions
of the instrument is determined. For financial instruments classified as equity instruments, interest expenses or dividend
distributions are treated as profit distribution of the Company, and repurchases and cancellations are treated as changes in
equity; for financial instruments classified as financial liabilities, interest expenses or dividend distributions are in principle
treated according to borrowing costs, and gains or losses arising from repurchase or redemption are credited to profit or
loss for the current period.
lnterim Report 2022 137
The transaction costs such as charges and commissions incurred by the Company when issuing financial instruments, if
classified as debt instruments and measured at amortised cost, are included in the initial measurement amount of the
issued instrument; if classified as equity instruments, are deducted from equity.
28. Revenue
√ Applicable □ N/A
The Company shall recognise revenue when the Company satisfies the performance obligation of the contract, that is, the
customer obtains control of relevant goods or services.
When the contract contains two or more performance obligations, on the effective date of the contract, the Company
allocates the transaction price to each performance obligation based on the percentage of respective unit price of a good
or service guaranteed by each performance obligation, and the revenue is measured according to the transaction price
allocated to each performance obligation.
If one of the following conditions is fulfilled, the Company satisfies a performance obligation over time; otherwise, it
satisfies a performance obligation at a point in time:
① When the customer simultaneously receives and consumes the benefits provided by the Company when the Company
performs its obligations under the contract.
② When the customer is able to control the commodity in progress in the course of performance by the Company under
the contract.
③ The product produced by the Company under the contract is irreplaceable and the Company has the right to payment
for performance completed to date during the term of the contract.
For a performance obligation satisfied over time, the Company shall recognise revenue over time by measuring the process
towards complete satisfaction of the performance obligation. When the progress of performance cannot be reasonably
determined, if the costs incurred by the Company are expected to be recoverable, the revenue will be recognised to the
extent of the costs incurred until the progress of performance can be reasonably determined.
For a performance obligation satisfied at a point in time, the Company shall recognise revenue when the customer obtains
control of relevant goods or services. When determining whether the customer has obtained control of the goods and
services, the Company will consider the following indications:
① The Company has the current right to receive payment for the goods or services, which is when the customers have
the current payment obligations for the goods.
② The Company has transferred the legal title of the goods to the client, which is when the client possesses the legal
title of the goods.
③ The Company has transferred the physical possession of goods to the customer, which is when the customer obtains
physical possession of the goods.
④ The Company has transferred all of the substantial risks and rewards of ownership of the goods to the customer, which
is when the client obtains all of the substantial risks and rewards of ownership of the goods to the customer.
⑤ When the customer has accepted the goods or services.
⑥ When other information indicates that the customer has obtained control of the goods.
A contract asset represents the Company’s right to consideration in exchange for goods or services that it has transferred
to a customer when that right is conditioned on factors other than passage of time, for which the loss allowances for
expected credit loss is recognised (see Note III. 10(6)). The Company shall present any unconditional (i.e. if only the passage
of time is required) rights to consideration separately as a receivable. A contract liability is the Company’s obligation to
transfer goods or services to a customer for which the Company has received consideration (or the amount is due) from
the customer.
138 Joincare Pharmaceutical Group Industry Co., Ltd.
The contract assets and liabilities under the same contract shall be shown on a net basis. If the net amount stated in debit
balance, it will be presented under the items of “Contract assets” or “Other non-current assets” according to its mobility; If
the net amount stated in credit balance, it will be presented under the items of “Contract liabilities” or “Other non-current
liabilities” according to its mobility.
The Company enters into sales contracts with customers. Revenue from sales is recognised according to the invoiced
amount upon the delivery of goods to the designated carrier or purchaser according to the orders received from
customers; revenue from export sales is recognised mainly by adopting FOB mode according to custom declaration upon
making declaration for goods and completing the export procedures.
29. Contract costs
√ Applicable □ N/A
Contract costs are either the incremental costs of obtaining a contract with a customer or the costs to fulfil a contract with
a customer.
Incremental costs of obtaining a contract are those costs that the Company incurs to obtain a contract with a customer
that it would not have incurred if the contract had not been obtained e.g. an incremental sales commission. The Company
recognises as an asset the incremental costs of obtaining a contract with a customer if it expects to recover those costs.
Other costs of obtaining a contract are expensed when incurred.
If the costs to fulfil a contract with a customer are not within the scope of inventories or other accounting standards,
the Company recognises an asset from the costs incurred to fulfil a contract only if those costs meet all of the following
criteria:
① The costs relate directly to an existing contract or to a specifically identifiable anticipated contract, including direct
labour, direct materials, allocations of overheads (or similar costs), costs that are explicitly chargeable to the customer
and other costs that are incurred only because the Company entered into the contract;
② The costs generate or enhance resources of the Company that will be used in satisfying (or in continuing to satisfy)
performance obligations in the future;
③ The costs are expected to be recovered.
Assets recognised for the incremental costs of obtaining a contract and assets recognised for the costs to fulfil a contract
(the “assets related to contract costs”) are amortised on a systematic basis that is consistent with the transfer to the
customer of the goods or services to which the assets relate and recognised in profit or loss for the current period.
The Company recognises an impairment loss in profit or loss to the extent that the carrying amount of an asset related to
contract costs exceeds:
① Remaining amount of consideration that the Company expects to receive in exchange for the goods or services to
which the asset relates;
② The cost estimated to be happened for the transfer of related goods or services.
The costs of contract performance recognised as assets, if the amortisation period is less than one year or a normal
operating cycle upon the initial recognition, are presented as “Inventories” item, and if the amortisation period is more
than one year or a normal operating cycle upon the initial recognition, are presented as “Other non-current assets” item.
The contract obtaining costs recognised as assets, if the amortisation period is less than one year or a normal operating
cycle upon the initial recognition, are presented as “Other current assets” item, and if the amortisation period is more than
one year or a normal operating cycle upon the initial recognition, are presented as “Other non-current assets” item.
lnterim Report 2022 139
30. Government grants
√ Applicable □ N/A
A government grant shall be recognised only when the enterprise can comply with the conditions attaching to the grant
and the enterprise can receive the grant.
If a government grant is in the form of a transfer of a monetary asset, the item is measured at the amount received. If a
government grant is in the form of a transfer of a non-monetary asset, the item is measured at fair value, when fair value is
not reliably determinable, the item is measured at a nominal amount of RMB1.
Government grant related to assets represents the government grant received for acquisition and construction of long
term assets, or forming long term assets in other ways. Except for these, all are government grant related to income.
Regarding to the government grant not clearly defined in the official documents and can form long term assets, the part
of government grant which can be referred to the value of the assets is classified as government grant related to assets
and the remaining part is government grant related to income. For the government grant that is difficult to distinguish,
the entire government grant is classified as government grant related to income.
The government grant related to assets is recognised as deferred income and would be transferred to profit or loss in
reasonable and systematic manner within the period of use of the relevant assets. The government grant related to
income which is used to compensate the relevant costs or losses incurred should be recognised in the profit or loss for the
current period; the government grant related to income which is used to compensate the relevant costs or losses for the
subsequent period is recognised as deferred income and shall be recognised in profit or loss during the relevant cost or
loss confirmation period. Government grants measured in nominal terms are directly included in the profit or loss for the
current period. The Company has adopted a consistent approach to the same or similar government grant business.
The government grants related to daily activities are recognised as other gains in accordance with the substance of
economic business. Government grants that are not related to daily activities are recognised as non-operating income and
expenses.
If the recognised government grants need to be refunded, adjust the carrying amount of assets when the carrying
amount of assets is offset at the time of initial recognition; the balance of deferred income is offset against the carrying
amount of the balance of deferred income and the excess is recognised in the profit or loss for the current period. Other
circumstances, it is directly recognised in the profit or loss for the current period.
31. Deferred tax assets and deferred tax liabilities
√ Applicable □ N/A
(1) Current tax
At the balance sheet date, for the current tax liabilities (or assets) arising from the current period and the previous period,
should be measured by the tax of the estimated payable (returnable) amount which be calculated according to the
regulations of the tax law. The amount of the tax payable which is based by the calculation of the current tax expenses,
are according to the result measured from the corresponding adjustment of the pre-tax accounting profit of the current
period which in accord to the relevant regulations of the tax law.
(2) Deferred tax assets and deferred tax liabilities
The difference between the carrying amount of an asset or liability and its tax basis, as well as the temporary differences
arising from differences between the carrying amount and tax basis of items that are not recognised as assets and liabilities
but in accordance with the tax law, can be recognised as deferred tax assets and deferred tax liabilities by adopting the
balance sheet liability method.
140 Joincare Pharmaceutical Group Industry Co., Ltd.
No deferred tax liability is recognised for a temporary difference arising from the initial recognition of goodwill the initial
recognition of assets or liabilities due to a transaction other than a business combination, which affects neither accounting
profit nor taxable profit (or deductible loss). Besides, no deferred tax assets well be recognised for the taxable temporary
differences related to the investments in subsidiaries, associates and joint ventures, if the Company can control the time
of the reverse of temporary differences as well as the temporary differences are unlikely to be reversed in the foreseeable
future. Except for the above exceptions, the Company recognises all deferred income tax liabilities arising from other
taxable temporary differences.
The deductible temporary differences the initial recognition of assets or liabilities arising from transactions that are
neither a business combination, nor do they affect accounting profits and taxable income (or deductible losses), will not
be recognised as related deferred income tax assets. In addition, as for the taxable temporary differences associated with
investments in subsidiaries, associates and joint ventures, if the Company is able to control the timing of the reversal of the
temporary differences, and the temporary differences may not be reversed in the foreseeable future, the related deferred
income tax assets will also not be recognised. Except for the above exceptions, the Company recognises a deferred tax
asset arising from other deductible temporary differences, to the extent that it is probable that taxable income will be
available against which the deductible temporary differences.
The Company recognises a deferred tax asset for the carry-forward of deductible losses and tax credits to subsequent
periods, to the extent that it is probable that future taxable profits will be available against which deductible losses and tax
credits can be utilised.
At the balance sheet date, deferred tax assets and deferred tax liabilities are measured at the tax rates that are expected to
apply to the period when the asset is realised or the liability is settled in accordance with the provisions of the tax law.
At the balance sheet date, the Company reviews the carrying amount of a deferred tax asset. If it is probable that sufficient
taxable profits will not be available in future periods to allow the benefit of the deferred tax asset to be utilised, the
carrying amount of the deferred tax asset is reduced. Any such reduction in amount is reversed when it becomes probable
that sufficient taxable profits will be available.
(3) Tax expenses
The tax expenses comprise current tax and deferred tax.
The rest current tax and deferred tax expenses or revenue should be included into current gains and losses expect for
the current tax and the deferred tax related to the transaction and events that be confirmed as other comprehensive
income or be directly included in the shareholders’ equity which should be included in other comprehensive income
or shareholders’ equity as well as the book value for adjusting the goodwill of the deferred income tax occurs from the
business combination.
(4) Offset of tax
The current tax assets and liabilities of the Company should be listed by the written-off net amount which intend to
execute the net amount settlement as well as the assets acquiring and liabilities liquidation at the same time while owns
the legal rights of settling the net amount.
The deferred tax assets and liabilities of the Company should be listed as written-off net amount when having the legal
rights of settling the current tax assets and liabilities by net amount and the deferred tax and liabilities is relevant to the
tax which be collected from the same taxpaying bodies by the same tax collection and administration department or is
relevant to the different taxpaying bodies but during each period which there is significant reverse of the deferred income
assets and liabilities in the future and among which the involved taxpaying bodies intend to settle the current income tax
and liabilities by net amount or are at the same time acquire the asset as well as liquidate the liabilities.
lnterim Report 2022 141
32. Leases
(1) Identification of leases
At the inception of a contract, the Company, as a lessee or lessor, assesses if the customer in a contract has the right
to obtain substantially all the economic benefits from use of the identified assets and the right to direct the use of the
identified assets in the period of use. The Company would identify that a contract is a lease, or contains a lease if a party
of the contract transfers the right to control the use of one or more identified assets for a period of time in exchange for
consideration.
(2) The Company as the lessee
At the inception of a lease, the Company recognises all its leases as the right-of-use assets and lease liabilities, except for
the short-term leases and the leases of low-value assets which are treated with a simplified approach.
For the accounting policies on the right-of-use assets, please refer to Note III. 33.
Lease liabilities are initially measured based on the present value of outstanding lease payment at the inception of a
lease, discounted using the interest rate implicit in the lease or the incremental borrowing rate. Lease payment include:
fixed payments and in-substance fixed payments, less any lease incentives (if there is a lease incentive); variable lease
payment that are based on an index or a rate; the exercise price of a purchase option if the lessee is reasonably certain to
exercise that option; payments of penalties for terminating the lease option, if the lease term reflects that the lessee will
exercise that option; and amounts expected to be payable under the guaranteed residual value provided by the lessee.
The Company shall subsequently calculate the interest expenses of lease liabilities over the lease term at the fixed periodic
interest rate, and include it into the profit or loss for the current period. Variable lease payments not included in the
measurement of lease liabilities are charged to profit or loss in the period in which they actually arise.
Short-term lease
Short-term lease refers to the lease that the lease term does not exceed 12 months from the inception of a lease, and the
lease that includes the option of purchase is not a short-term lease.
The Company recognises the amount of lease payments of short-term lease in the cost of the related asset or the profit or
loss for the current period, on a straight-line method over each period of the lease term.
Leases of low-value assets
For the Leases of low-value assets, the Company chooses to adopt the above simplified treatment method in accordance
with the specific conditions of each lease.
The Company recognised the lease payments for the leases of low-value assets in the relevant asset cost or the profit or
loss for the current period on a straight-line basis over each period of the lease term.
(3) The Company as the lessor
When the Company is the lessor, the lease that substantially transfers all the risks and rewards related to the ownership of
assets is recognised as a finance lease, and leases other than finance leases are recognised as operating leases.
(4) Accounting treatment method of operating lease
√ Applicable □ N/A
For the rental of operating leases, the Company recognises it in the profit or loss for the current period on a straight –
line basis over each period of the lease term. The initial direct cost incurred in connection with an operating lease shall be
capitalised and amortised on the same basis for recognition of rental income during the lease term, and shall be included
in instalments in the profit or loss for the current period. The variable lease payment, which is obtained in connection with
an operating lease and not included in the lease receivables, shall be included in the profit and loss for the current period
when they actually occur.
142 Joincare Pharmaceutical Group Industry Co., Ltd.
(5) Accounting treatment method of finance leases
√ Applicable □ N/A
In a financial lease, the Company uses the net investment in leases as the carrying amount of finance lease receivables
at the inception of a lease. The net investment in leases is the sum of the unguaranteed residual value and the present
value of the outstanding lease payment at the inception of a lease, discounted using the interest rate implicit in the lease.
The Company, as the lessor, calculates and recognises the interest income over each period of the lease term at a fixed
periodic interest rate. Variable lease payments not included in the measurement of the lease liability, which are obtained
by the Company as a lessor, are recognised in profit or loss as incurred.
The termination of recognition and impairment of financial lease receivables is accounted for in accordance with
the provisions of “Accounting Standards for Business Enterprises No. 22 – Recognition and Measurement of Financial
Instrument” and “Accounting Standards for Business Enterprises No. 23 – Transfer of Financial Assets”.
33. Right-of-use assets
√ Applicable □ N/A
(1) Recognition condition of right-of-use assets
The right-of-use assets of the Company are defined as the right of underlying assets in the lease term for the Company as
a lessee.
Right-of-use assets are initially measured at cost as at the commencement date of the lease, which consists of: the amount
of the initial measurement of the lease liability; any lease payments made at or before the commencement date of the
lease less any lease incentives received if any; initial direct expenses incurred by the Company as a lessee; costs to be
incurred by the Company as a lessee in dismantling and removing a leased asset, restoring the site on which it is located
or restoring the leased assets to the condition required by the terms and conditions of the lease. The Company as a
lessee recognises and measures the costs of demolition and restoration according to “Accounting Standards for Business
Enterprises No.13 – Contingencies”, and subsequently adjusts for any remeasurement of lease liability.
(2) Depreciation method of right-of-use assets
The Company calculates depreciation on a straight-line basis. Right-of-use assets in which the Company as a lessee is
reasonably certain to obtain ownership of the underlying leased assets at the end of the lease term are depreciated
over the remaining useful life. Otherwise, right-of-use assets are depreciated over the shorter of the lease term and its
remaining useful life.
(3) For methods of impairment testing and provision for impairment for right-of-use assets, please refer to note III. 22.
34. Repurchase of shares
Prior to cancellation or transfer of shares repurchased, the Company recognises all expenditures arising from share
repurchase as cost of treasury shares in the treasury share account. Considerations and transaction fee incurred from the
repurchase of shares shall lead to the elimination of owners’ equity and does not recognise profit or loss when shares of
the Company are repurchased, transferred or cancelled.
The difference between the actual amount received and the carrying amount of the treasury stock are recognised as
capital reserve when the treasury stocks are transferred, if the capital reserve is not sufficient to be offset, the excess
amount shall be recognised to offset surplus reserve and undistributed profit. When the treasury stocks are cancelled, the
capital shall be eliminated according to the number of shares and par value of cancellation shares, the difference between
the actual amount received and the carrying amount of the treasury stock are recognised as capital reserve, if the capital
reserve is not sufficient to be offset, the excess amount shall be recognised to offset surplus reserve and undistributed
profit.
lnterim Report 2022 143
35. Restricted Shares
If the Company grants the restricted shares to incentive participants under the Share Options Incentive Scheme,
the incentive participants subscribe for the shares first. If the unlocking conditions stipulated in the Share Options
Incentive Scheme cannot be fulfilled subsequently, the Company repurchases the shares at the predetermined price.
If the registration and other capital increase procedures for the restricted shares issued to employees are completed in
accordance with relevant regulations, the Company recognises share capital and capital reserve (or capital premium)
based on the subscription money received from the employees on the grant date; and recognises treasury shares and
other payables for repurchase obligation.
36. Other significant accounting judgements and estimates
√ Applicable □ N/A
Significant accounting estimates and critical assumptions adopted by the Company are continually evaluated based on
historical experience and other factors, including expectations of future events that are believed to be reasonable. The
significant accounting estimates and critical assumptions that have a significant risk of causing a material adjustment to
the carrying amounts of assets and liabilities within the next accounting year are set out below:
(1) Classification of financial assets
Significant judgements involved in determining the classification of financial assets include analysis of business mode and
characteristics of the contractual cash flows.
Factors considered by the Company in determining the business model of financial assets management for a group
of financial assets include past experience on how financial asset’s performance is evaluated and reported to key
management personnel, how risks affecting the performance of financial asset are assessed and managed and how
managers of related businesses are compensated.
When assessing whether the contractual cash flows of financial assets are consistent with basic lending arrangement, the
Company adopts the following significant judgements: whether the time distribution or amounts of the principal within
the duration may change due to early repayment and other reasons; whether the interest includes only the time value of
money, credit risk, other basic lending risks and the consideration for cost and profit. For example, the amounts of early
repayment only reflect principal unpaid, the interest based on principal unpaid and reasonable compensation paid for
early termination of a contract.
(2) Measurement of ECL for accounts receivables
The Company calculates ECL of accounts receivables according to their exposure at default and ECL rate, and determines
ECL rate based on probability of default and loss given default. When determining ECL rate, the Company adopts data like
historical credit loss experience in combination with current situation and forward-looking information to adjust historical
data. When considering forward-looking information, the Company uses indicators including the risk of economic
downturn, external market environment, technology environment and changes on customer situation. The Company
periodically monitors and reviews assumptions relevant to the measurement of ECL.
(3) Impairment of goodwill
The Company evaluates whether goodwill is impaired at least once a year. This requires an estimate of the value in use of
the asset groups to which the goodwill is allocated. In estimating the value in use, the Company needs to estimate the
future cash flows generated from the asset groups and also to choose an appropriate discount rate in order to calculate
the present value of the future cash flows.
(4) Development costs
Determining the amounts to be capitalised requires the management to make assumptions regarding the expected future
cash flows generated from the relevant assets, discount rates to be applied and the expected period of benefits.
144 Joincare Pharmaceutical Group Industry Co., Ltd.
(5) Deferred tax assets
The deferred income tax assets will be recognised for all unused tax losses to the extent that it is probable that there will
be sufficient taxable profits against which the loss is utilised. This requires the management to exert numerous judgments
to estimate the timing and amount of the future taxable profits so as to determine the amount of deferred income tax
assets to be recognised with reference to the tax planning strategy.
(6) Revenue recognition
As stated in note III. 28, the Company makes the following significant accounting judgements and estimates in terms of
revenue recognition: identifying customer contracts; estimating the recoverability of the considerations that are entitled
to be obtained by transferring goods to customers; identifying the performance obligation in the contract; estimating the
variable consideration in the contract and cumulative revenue recognised where it is highly probable that a significant
reversal therein will not occur when the relevant uncertainty is resolved; assessing whether there is a significant financing
component in the contract; estimating the individual selling price of the individual performance obligation in the contract,
etc. The Company makes judgments primarily based on historical experiences and works. Changes in these significant
judgments and estimates may have significant impacts on the operating income, operating costs, and profit or loss of the
current or subsequent periods.
(7) Determination of the fair value of unlisted equity investment
The fair value of unlisted equity investments represents the expected future cash flows discounted at the prevailing
discount rate of items with similar terms and risk characteristics. It requires the Company to estimate the expected future
cash flows and discount rates, and therefore there is uncertainty. Under limited circumstances, if the information used
to determine the fair value is insufficient, or the possible estimated amount of fair value is widely distributed, and cost
represents the best estimate of the fair value within such scope, the cost may represent an appropriate estimate of the fair
value within such distribution scope.
37. Changes in significant accounting policies and accounting estimates and correction to accounting errors
(1) Changes in significant accounting policies
√ Applicable □ N/A
The Ministry of Finance (MOF) issued the Interpretation No. 15 of Accounting Standards for Business Enterprises
(“Interpretation No. 15”) in December 2021.
According to Interpretation No. 15, if the Company sells the products or by-products produced before the fixed assets
reach the status of intended use or during the research and development process (hereinafter collectively referred to as
“revenue in trial operation”), in accordance with the “Accounting Standards for Business Enterprises No. 14 – Revenue”,
“Accounting Standards for Business Enterprises No. 1 – Inventories” and other regulations, the relevant sale revenue and
costs of the trial operation shall be accounted for separately and included in the profit or loss for the current period, rather
than the net amount of sale revenue after offsetting relevant costs of the trial operation sales write-off against the cost of
fixed assets or research and development expenditures.
Interpretation No. 15 clarifies the judgment on onerous contracts. When judging an onerous contract, the costs of contract
performance includes the incremental cost of performing the contract and the direct attributed amount of other costs
relevant to the performance of the contract.
Interpretation 15 came into effect on January 1, 2022, and the Company adopts the prospective method to account for
the above changes in accounting policies.
The adoption of Interpretation No. 15 has not had a material impact on the Company’s financial position and results of
operations.
(2) Changes in significant accounting estimates
□ Applicable √ N/A
lnterim Report 2022 145
VI. Taxation
1. Major taxes and their tax rates
√ Applicable □ N/A
Tax category Basis of taxation Statutory tax rate
Value added tax Taxable revenue 3%, 6%, 13%
Urban maintenance and construction tax Turnover tax to be paid 1%, 5%, 7%
Education surcharges Turnover tax to be paid 3%
Local education surcharge Turnover tax to be paid Note 1
Enterprise income tax Turnover tax to be paid Note 2
Note 1: The Company and its subsidiaries that are incorporated in Shenzhen and Zhuhai shall pay local education surcharges that are charged as 2% of the
turnover tax payable. Other subsidiaries shall pay local education surcharges according to the tax rate as specified at their places of incorporation on the basis
of turnover tax payable.
Note 2: The implementation of enterprise income tax rate is as follows:
Disclosure of taxpayers (if any) with different rates of enterprise income tax
√ Applicable □ N/A
Taxpayer Rate of enterprise income tax
(%)
Hong Kong Health Pharmaceutical Industry Company Limited, Livzon
Pharmaceutical Biotechnology Co., Ltd., Lian (Hong Kong) Co., Ltd., Livzon Biologics 16.5
Hong Kong Limited
0 or 12 (Tax rate is 12% where the
taxable income is MOP600,000 or
more; for those with taxable
Companhia de Macau Carason Limitada, Li Zhu (Macau) Limitada
income less than MOP600,000,
they are exempted from
income taxes.)
Shenzhen Taitai Pharmaceutical Co., Ltd., Shenzhen Haibin Pharmaceutical Co.,
Ltd., Xinxiang Haibin Pharmaceutical Co., Ltd., Jiaozuo Joincare Bio Technological
Co., Ltd, Shanghai Frontier Health Medicine Technology Co., Ltd., Guangzhou
Joincare Respiratory Medicine Engineering Technology Co., Ltd, Joincare Haibin
Pharmaceutical Co., Ltd., Livzon Group and subsidiaries of Livzon Group, Livzon
Group Limin Pharmaceutical Manufacturing Factory, Livzon Group Livzon
Pharmaceutical Factory, Zhuhai FTZ Livzon Hecheng Pharmaceutical Manufacturing
15
Co., Ltd., Shanghai Livzon Pharmaceutical Manufacturing Co., Ltd., Livzon Group
Xinbeijiang Pharmaceutical Manufacturing Inc., Sichuan Guangda Pharmaceutical
Manufacturing Co., Ltd., Zhuhai Livzon Diagnostics Inc., Livzon Group Fuzhou
Fuxing Pharmaceutical Co., Ltd., Shanghai Livzon Biotechnology Co., Ltd., Livzon
Group (Ningxia) Pharmaceutical Manufacturing Co., Ltd., Zhuhai Lihe Medical
Diagnostic Product Company Limited, Zhuhai Livzon Traditional Chinese Medicine
Modernization Technology Co., Ltd.
Livzon MAB Pharm (US) Inc. 21
Health Investment Holdings Ltd, Joincare Pharmaceutical Group Industry Co.,Ltd.,
Livzon International Ventures, Livzon International Ventures I, Livzon International 0 (Note 1)
Ventures II.
Other subsidiaries 25
Note 1: Companies registered in the British Virgin Islands and the Cayman Islands are not subject to enterprise income tax.
146 Joincare Pharmaceutical Group Industry Co., Ltd.
2. Tax incentives
√ Applicable □ N/A
(1) Preferential value added tax
In accordance with the Announcement on Value Added Tax on Biological Products Sold by Pharmaceutical Operation
Enterprises issued by the State Administration of Taxation (Announcement of State Administration of Taxation 2012 No. 20)
and the Notice of the Ministry of Finance, the General Administration of Customs, the State Administration of Taxation and
the State Drug Administration on the Value-Added Tax Policies for Anti-Cancer Drugs (Caishui [2018] No. 47), the biological
products sold by the Company are subject to value added tax at 3% by the simple approach.
(2) Preferential enterprise income tax
The Company’s subsidiaries, Shenzhen Taitai Phamaceutical Co., Ltd, Shenzhen Haibin Phamaceutical Co., Ltd, Xinxiang
Haibin Phamaceutical Co., Ltd and Shanghai Frontier Health Medicine Technology Co., Ltd are entitled to enjoy preferential
income tax policies applicable to high and new technology enterprises for 3 years with effective from 2020, and Joincare
Haibin Pharmaceutical Co., Ltd is entitled to enjoy preferential income tax policies applicable to high and new technology
enterprises for 3 years with effective from 2021. Jiaozuo Joincare Bio Technological Co., Ltd., Guangzhou Joincare
Respiratory Drug Engineering Technology Co., Ltd. have reapplied for recognition of high and new technology enterprises
in the period. Livzon Group and its subsidiaries – Livzon Group Limin Pharmaceutical Manufacturing Factory, Livzon Group
Livzon Pharmaceutical Factory, Zhuhai FTZ Livzon Hecheng Pharmaceutical Manufacturing Co., Ltd., Shanghai Livzon
Pharmaceutical Manufacturing Co., Ltd., Livzon Group Fuzhou Fuxing Pharmaceutical Co., Ltd. and Sichuan Guangda
Pharmaceutical Manufacturing Co., Ltd. are entitled to enjoy preferential income tax policies applicable to high and new
technology enterprises for 3 years with effective from 2020; Livzon Group Xinbeijiang Pharmaceutical Manufacturing Inc.
and Zhuhai Livzon Diagnostics Inc. have reapplied for recognition of high and new technology enterprises in the period;
Shanghai Livzon Biotechnology Co., Ltd. are entitled to preferential income tax policies applicable to high and new
technology enterprises for 3 years with effective from 2021. Livzon Group (Ningxia) Pharmaceutical Manufacturing Co.,
Ltd. was approved to enjoy the enterprise taxation preference of the Encouraged Industries in Western China. The above
companies were subject to enterprise income tax rate of 15% for the period.
In accordance with Article 27 of the Enterprise Income Tax Law of the People’s Republic of China and Article 86 of the
Regulations for the Implementation of the Enterprise Income Tax Law of the People’s Republic of China, the business of
planting Chinese herbal medicines engaged by the subsidiaries of the Livzon, Datong Livzon Qiyuan Medicine Co., Ltd. and
Longxi Livzon Shenyuan Medicine Co., Ltd. are exempted from enterprise income tax.
According to the Notice of the Ministry of Finance and the State Administration of Taxation on the Preferential Enterprise
Income Tax Policies of the Guangdong-Macao In-depth Cooperation Zone of Hengqin (Cai Shui [2022] No. 19), qualified
industrial enterprises located in the Guangdong-Macao In-depth Cooperation Zone of Hengqin will be subject to a
reduced enterprise income tax rate of 15%. Zhuhai Lihe Medical Diagnostic Product Company Limited and Zhuhai
Livzon Traditional Chinese Medicine Modernization Technology Co., Ltd. met relevant conditions, and were subject to an
enterprise income tax rate of 15% for the Period.
According to the preferential tax policies for small low-profit enterprises, the portion of annual taxable income of a small
low profit enterprise which does not exceed RMB1 million is subject to enterprise income tax at a tax rate of 2.5%; the
portion over RMB1 million but not exceeding RMB3 million is subject to enterprise income tax at a tax rate of 10%.
3. Others
□ Applicable √ N/A
lnterim Report 2022 147
V. Notes to the items of consolidated financial statements
1. Cash and bank balances
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at End Balance at Beginning
Items of the Period of the Period
Cash on hand 190,985.30 225,179.98
Bank deposits 12,498,359,889.55 11,554,754,721.43
Other monetary funds 154,558,074.32 174,250,489.57
Total 12,653,108,949.17 11,729,230,390.98
Including: total overseas deposits 1,543,366,154.88 1,309,853,620.27
Other descriptions:
① Other monetary funds are mainly deposits for investments, deposits under guarantee of letter of guarantee, issuing
letters of credit and foreign exchange forward contracts, etc.
② Restricted funds relating to issuing letters of credit and foreign exchange forward contracts, etc. in other monetary
funds were deducted from cash and cash equivalents in the cash flow statement. Apart from these restricted funds,
there is no other charge, pledge or lock up on the balance of cash at bank and on hand that may limit its use, is kept
outside China and may have probable risks in its collection. Below are the details of the use of restricted monetary
funds:
Item 30 June 2022 31 December 2021
Deposits for letter of credit 188,710.11 1,788,607.74
Deposits for bank acceptance bills 377.93 6,004,457.37
Deposits for other business 962,104.96 3,949,531.92
Total 1,151,193.00 11,742,597.03
2. Financial assets held for trading
√ Applicable □ N/A
(1) Classification
Unit: Yuan Currency: RMB
Balance at the Balance at the
Item End of the Period Beginning of the Period
Financial asset measured at fair value through profit or loss 99,806,543.32 184,638,344.31
Including:
Debt instrument investments 953,678.89 940,162.94
Equity instrument investments 98,802,998.87 176,321,853.05
Derivative financial assets 49,865.56 7,376,328.32
Total 99,806,543.32 184,638,344.31
148 Joincare Pharmaceutical Group Industry Co., Ltd.
Other descriptions:
√ Applicable □ N/A
① The Company’s investments in equity instruments and debt instruments for financial assets held for trading at the
End of the Period were listed for trading on Shenzhen Stock Exchange, Hong Kong Stock Exchange and NASDAQ in
the United States. The fair value was determined based on the closing price on the last trading day in the Reporting
Period.
② Derivative financial assets represent foreign currency forward contracts, futures contracts and gains from unexpired
contracts measured at fair value which were recognised as financial assets as at the balance sheet date.
No restrictive financial asset measured at fair value through profit or loss was included in the closing balance.
No hedging instruments in the closing balance and no hedging transactions have occurred during the period.
3. Notes receivable
(1) Classified presentation of notes receivable
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the End Balance at the
Category of the Period Beginning of the Period
Bank acceptance bills 1,888,954,693.79 1,977,767,022.02
bad debts -481,000.00 -481,000.00
Total 1,888,473,693.79 1,977,286,022.02
(2) Notes receivable pledged at period end
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Amount pledged
Category at period end
Bank acceptance bills 526,815,981.78
Total 526,815,981.78
As at 30 June 2022, bank acceptance bills with carrying amount of RMB526,815,981.78 (31 December 2021:
RMB870,153,979.75) have been used as pledge for opening of bills.
(3) Bills endorsed or discounted to other parties but not yet expired at balance sheet date
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Derecognised amount Amount not
at the End of derecognised at
Category the Period the End of the Period
Bank acceptance bills not yet mature but already endorsed 407,822,740.99 0.00
Bank acceptance bills not yet mature but already discounted 429,075,183.95 0.00
Total 836,897,924.94 0.00
In the current period, the Company discounted bank acceptance bills of RMB714,219.83 thousand (previous year:
RMB76,908.32 thousand), including discounted bank acceptance bills of RMB285,144.65 thousand that have expired,
and bank acceptance bills not yet mature but already discounted of RMB429,075.18 thousand. Since the major risks and
rewards such as interest rate risk related to these bank acceptance bills have been transferred to the bank, the Company
derecognizes the discounted unexpired bank acceptance bills. Factoring expenses incurred was RMB6,657.46 thousand
(previous year: RMB506.78 thousand).
lnterim Report 2022 149
(4) Bills transferred into account receivables for non-performance by the issuer as at balance sheet date of the period
□ Applicable √ N/A
(5) Disclosure by method of provision for bad debts
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the End of the Period Balance at the Beginning of the Period
Book balance Provision for bad debts Book balance Provision for bad debts
Expected Expected
credit loss credit loss
Category Amount Ratio Amount rate Carrying value Amount Ratio Amount rate Carrying value
(%) (%) (%) (%)
Provision for bad debts 481,000.00 0.03 481,000.00 100.00 0.00 481,000.00 0.02 481,000.00 100.00 0.00
on individual item
Including:
Bank acceptance bills 481,000.00 0.03 481,000.00 100.00 0.00 481,000.00 0.02 481,000.00 100.00 0.00
Provision for bad debts 1,888,473,693.79 99.97 0.00 0.00 1,888,473,693.79 1,977,286,022.02 99.98 0.00 0.00 1,977,286,022.02
on portfolio basis
Including:
Bank acceptance bills 1,888,473,693.79 99.97 0.00 0.00 1,888,473,693.79 1,977,286,022.02 99.98 0.00 0.00 1,977,286,022.02
Total 1,888,954,693.79 100.00 481,000.00 0.03 1,888,473,693.79 1,977,767,022.02 100.00 481,000.00 0.02 1,977,286,022.02
Provision for bad debts on individual item:
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the End of the Period
Provision for Expected credit
Name Book balance bad debts loss rate Reason of provision
(%)
Henan Jiuzhoutong Pharmaceutical 431,000.00 431,000.00 100.00 Expected to be uncollectible
Co., Ltd.
Other customers 50,000.00 50,000.00 100.00 Expected to be uncollectible
Total 481,000.00 481,000.00 100.00 /
Descriptions of provision for bad debts made individually:
□ Applicable √ N/A
Provision for bad debt on a collective basis:
□ Applicable √ N/A
If the provision for bad debts is made in accordance with the general model of expected credit losses, please refer to other
receivables disclosure:
□ Applicable √ N/A
150 Joincare Pharmaceutical Group Industry Co., Ltd.
(6) Provision for bad debts
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Changes for the current period
Beginning Recovery Removal/
Category balance Provision or reversal write-off Closing balance
Provision for bad debts 481,000.00 0.00 0.00 0.00 481,000.00
Total 481,000.00 0.00 0.00 0.00 481,000.00
Significant recovery or reversal of bad debt provision for the current period:
□ Applicable √ N/A
(7) Actual write-off of notes receivable in the period
□ Applicable √ N/A
Other descriptions:
□ Applicable √ N/A
4. Accounts receivable
(1) Disclosed by aging
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Aging Balance at the End of the Period
Subtotal within 1 year: 2,922,163,126.08
1-2 years 12,655,577.05
2-3 years 2,497,810.03
3-4 years 12,108,874.22
4-5 years 3,007,544.08
Over 5 years 13,998,361.28
Total 2,966,431,292.74
According to the credit policy of the Company, the Company usually grants a credit period ranging from 30 to 90 days to
customers.
lnterim Report 2022 151
(2) Disclosure by method of provision for bad debts
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the End of the Period Balance at the Beginning of the Period
Book balance Provision for bad debts Book balance Provision for bad debts
Expected Expected
credit loss credit loss
Category Amount Ratio Amount rate Carrying value Amount Ratio Amount rate Carrying value
(%) (%) (%) (%)
Provision for bad debts 9,709,854.02 0.33 5,513,168.82 56.78 4,196,685.20 9,709,854.02 0.33 5,513,168.82 56.78 4,196,685.20
on individual item
Including:
Receivables from 9,709,854.02 0.33 5,513,168.82 56.78 4,196,685.20 9,709,854.02 0.33 5,513,168.82 56.78 4,196,685.20
domestic customers
Receivables from 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
overseas customers
Provision for bad debts 2,956,721,438.72 99.67 65,454,959.96 2.21 2,891,266,478.76 2,916,387,527.16 99.67 66,928,660.82 2.29 2,849,458,866.34
on portfolio basis
Including:
Receivables from 2,334,525,444.66 78.70 57,869,210.59 2.48 2,276,656,234.07 2,333,938,533.50 79.76 58,705,544.56 2.52 2,275,232,988.94
domestic customers
Receivables from 622,195,994.06 20.97 7,585,749.37 1.22 614,610,244.69 582,448,993.66 19.91 8,223,116.26 1.41 574,225,877.40
overseas customers
Total 2,966,431,292.74 100.00 70,968,128.78 2.39 2,895,463,163.96 2,926,097,381.18 100.00 72,441,829.64 2.48 2,853,655,551.54
Provision for bad debt on individual item:
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Closing balance
Provision Expected credit
Name Book balance for bad debts loss rate Reason of provision
(%)
Purchase of goods 9,709,854.02 5,513,168.82 56.78 Not expected to be recoverable
Total 9,709,854.02 5,513,168.82 56.78 /
Descriptions of Provision for bad debt on individual item:
□ Applicable √ N/A
Provision for bad debts on portfolio basis:
√ Applicable □ N/A
152 Joincare Pharmaceutical Group Industry Co., Ltd.
Provision for bad debts on portfolio basis: Receivables from domestic customers
Unit: Yuan Currency: RMB
Closing balance
Account Provision for Expected credit
Aging receivables bad debt loss rate
(%)
Within 1 year: 2,299,967,132.02 34,989,010.81 1.52
1 to 2 years (inclusive of 2 years) 12,655,577.05 2,215,019.09 17.50
2 to 3 years (inclusive of 3 years) 2,497,810.03 1,590,936.19 63.69
3 to 4 years (inclusive of 4 years) 3,715,503.81 3,421,392.09 92.08
4 to 5 years (inclusive of 5 years) 2,662,504.28 2,625,934.94 98.63
Over 5 years 13,026,917.47 13,026,917.47 100.00
Total 2,334,525,444.66 57,869,210.59 2.48
Standards of provision for bad debts on portfolio basis and descriptions thereof:
□ Applicable √ N/A
Provision for bad debts on portfolio basis: Receivables from overseas customers
Unit: Yuan Currency: RMB
Closing balance
Account Provision for Expected credit
Aging receivables bad debt loss rate
(%)
Within 1 year: 622,195,994.06 7,585,749.37 1.22
1 to 2 years (inclusive of 2 years) 0.00 0.00 0.00
2 to 3 years (inclusive of 3 years) 0.00 0.00 0.00
3 to 4 years (inclusive of 4 years) 0.00 0.00 0.00
4 to 5 years (inclusive of 5 years) 0.00 0.00 0.00
Over 5 years 0.00 0.00 0.00
Total 622,195,994.06 7,585,749.37 1.22
Standards of provision for bad debts on portfolio basis and descriptions thereof:
□ Applicable √ N/A
If the provision for bad debts is made in accordance with the general model of expected credit losses, please refer to other
receivables disclosure:
□ Applicable √ N/A
lnterim Report 2022 153
(3) Provision for bad debts
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Changes for the current period
Beginning Recovery Removal/ Closing
Category balance Provision or reversal write-off Others balance
Provision for bad debts 72,441,829.64 933,002.92 0.00 2,400,580.01 -6,123.77 70,968,128.78
Total 72,441,829.64 933,002.92 0.00 2,400,580.01 -6,123.77 70,968,128.78
At 30 June 2022 and 31 December 2021, the Company had no overdue but not impaired accounts receivable.
Significant recovery or reversal of bad debt provision for the current period:
□ Applicable √ N/A
(4) Actual write-off of accounts receivable in this period
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Item Amount written-off
Accounts receivable actually written off 2,400,580.01
Significant accounts receivable that are written off:
□ Applicable √ N/A
Descriptions of write-off of accounts receivable:
□ Applicable √ N/A
(5) Accounts receivable due from the top five debtors
√ Applicable □ N/A
As of 30 June 2022, the total amount of the top five debtors in closing balance is RMB304,945,004.71, accounting for
10.28% of the total amount of closing balance of accounts receivable, and the corresponding closing balance of provision
for bad debts is total RMB3,946,783.44.
(6) Accounts receivable derecognized due to the transfer of financial assets.
□ Applicable √ N/A
(7) Assets or liabilities formed by the continuing involvement of transferred accounts receivables.
□ Applicable √ N/A
Other descriptions:
□ Applicable √ N/A
154 Joincare Pharmaceutical Group Industry Co., Ltd.
5. Prepayments
(1) Disclosure of prepayments by aging analysis
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the End of the Period Balance at the Beginning of the Period
Aging Amount Ratio Amount Ratio
% %
Within 1 year 416,455,356.38 94.98 354,340,559.20 95.97
1 to 2 years 16,468,966.32 3.76 8,031,100.50 2.17
2 to 3 years 2,993,038.53 0.68 6,323,201.42 1.71
Over 3 years 2,538,761.15 0.58 537,685.17 0.15
Total 438,456,122.38 100 369,232,546.29 100.00
(2) Prepayments due from the top five debtors
√ Applicable □ N/A
As of 30 June 2022, the total amount of the top five prepayments in closing balance is RMB88,652,518.54, accounting for
20.22% of the total amount of closing balance of prepayments.
Other descriptions:
□ Applicable √ N/A
6. Other receivables
Line items
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the End of Balance at the
Item the Period Beginning of the Period
Interest receivable 0.00 365,873.64
Dividends receivable 215,678.92 0.00
Other receivables 50,673,057.79 87,687,951.48
Total 50,888,736.71 88,053,825.12
Other descriptions:
□ Applicable √ N/A
Interest receivable
(1) Classification of interest receivable
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the End of Balance at the
Item the Period Beginning of the Period
Interest on fixed deposits 0.00 365,873.64
Total 0.00 365,873.64
lnterim Report 2022 155
(2) Significant overdue interest
□ Applicable √ N/A
(3) Provision made for bad debts
□ Applicable √ N/A
Other receivables
□ Applicable √ N/A
Dividends receivable
(1) Dividends receivable
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the End Balance at the
Item of the Period Beginning of the Period
Kunlun Energy Company Limited 215,678.92 0.00
Total 215,678.92 0.00
(2) Significant dividends receivable aged over 1 year
□ Applicable √ N/A
(3) Provision made for bad debts
□ Applicable √ N/A
Other receivables
□ Applicable √ N/A
Other receivables
(1) Disclosed by aging
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Aging Balance at the End of the Period
Subtotal within 1 year 44,761,237.21
1 to 2 years 5,991,763.20
2 to 3 years 4,250,801.61
3 to 4 years 1,811,358.86
4 to 5 years 724,672.76
Over 5 years 32,060,805.56
Provision for bad debt -38,927,581.41
Total 50,673,057.79
156 Joincare Pharmaceutical Group Industry Co., Ltd.
(2) Disclosure by nature
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the End of Balance at the
Item the Period Beginning of the Period
Security deposits, deposits and rental fees 11,815,897.51 11,003,281.04
Reserved fund and advances 21,260,877.28 17,870,245.40
Related party balances 2,811,088.86 20,323,903.96
External entities balances 16,196,803.74 22,421,780.76
Tax refund on exports 13,916,376.41 17,708,111.60
Treasury bonds and security deposits 17,968,386.04 17,968,386.04
Capital reduction 0.00 24,078,925.22
Amounts of exercised options 2,429,180.84 8,463,240.98
Others 3,202,028.52 3,327,263.14
Total 89,600,639.20 143,165,138.14
(3) Information of provision for bad debts
√ Applicable □ N/A
At the End of the Period, provision for bad debts on those in first stage:
Expected credit Provision
loss rate in the for bad Carrying
Category Book balance next 12 months debts amount Reason
(%)
Provision for bad debts on 2,429,180.84 0.00 0.00 2,429,180.84
individual item
Amounts of exercised options 2,429,180.84 0.00 0.00 2,429,180.84 Expected to
be recovered
Capital reduction 0.00 0.00 0.00 0.00
Provision for bad debts on portfolio 0.00 0.00 0.00 0.00
basis
Total 2,429,180.84 0.00 0.00 2,429,180.84
At the End of the Period, provision for bad debts on those in second stage:
Expected credit
loss rate for Provision for Carrying
Category Book balance the lifetime bad debts amount Reason
(%)
Provision for bad debts on individual 0.00 0.00 0.00 0.00
item
Provision for bad debts on portfolio 58,926,446.39 18.13 10,682,569.44 48,243,876.95
basis
Export tax refund receivable 13,916,376.41 2.01 280,211.71 13,636,164.70
Security deposits, deposits and rental 11,815,897.51 28.66 3,386,116.92 8,429,780.59
receivable
Other receivables 33,194,172.47 21.14 7,016,240.81 26,177,931.66
Total 58,926,446.39 18.13 10,682,569.44 48,243,876.95
lnterim Report 2022 157
At the End of the Period, provision for bad debts on those in third stage:
Expected credit
loss rate for Provision for Carrying
Category Book balance the lifetime bad debts amount Reason
(%)
Provision for bad debts on 28,245,011.97 100.00 28,245,011.97 0.00
individual item
Other receivables 28,245,011.97 100.00 28,245,011.97 0.00 Not expected to
be recoverable
Provision for bad debts on 0.00 0.00 0.00 0.00
portfolio basis
Total 28,245,011.97 100.00 28,245,011.97 0.00
As of 31 December 2021, information of provision for bad debts:
As of 31 December 2021, Provision for bad debts on those in first stage:
Expected credit
loss rate in the Provision for Carrying
Category Book balance next 12 months bad debts amount Reason
(%)
Provision for bad debts on 32,542,166.20 0.00 0.00 32,542,166.20
individual item
Amounts of exercised options 8,463,240.98 0.00 0.00 8,463,240.98 Expected to
be recovered
Capital reduction 24,078,925.22 0.00 0.00 24,078,925.22 Expected to
be recovered
Provision for bad debts on 0.00 0.00 0.00 0.00
portfolio basis
Total 32,542,166.20 0.00 0.00 32,542,166.20
As of 31 December 2021, Provision for bad debts on those in second stage:
Expected credit
loss rate for Provision for Carrying
Category Book balance the lifetime bad debts amount Reason
(%)
Provision for bad debts on 0.00 0.00 0.00 0.00
individual item
Provision for bad debts on 63,594,020.80 13.28 8,448,235.52 55,145,785.28
portfolio basis
Export tax refund receivable 17,708,111.60 1.12 198,927.69 17,509,183.91
Security deposits, deposits and 11,003,281.04 26.33 2,897,272.69 8,106,008.35
rental receivable
Other receivables 34,882,628.16 15.34 5,352,035.14 29,530,593.02
Total 63,594,020.80 13.28 8,448,235.52 55,145,785.28
158 Joincare Pharmaceutical Group Industry Co., Ltd.
As of 31 December 2021, Provision for bad debts on those in third stage:
Expected credit
loss rate for Provision for Carrying
Category Book balance the lifetime bad debts amount Reason
(%)
Provision for bad debts 47,028,951.14 100.00 47,028,951.14 0.00
on individual item
Other receivables 47,028,951.14 100.00 47,028,951.14 0.00 Not expected to
be recoverable
Provision for bad debts 0.00 0.00 0.00 0.00
on portfolio basis
Total 47,028,951.14 100.00 47,028,951.14 0.00
(4) Accrual, recovery or reversal of bad debt provision during the period
Unit: Yuan Currency: RMB
First stage Second stage Third stage
Expected credit
loss for lifetime Expected credit
Expected credit (no credit loss for lifetime
loss within impairment (credit impairment
Provision for bad debt 12 months occurred) has occurred) Total
Beginning balance 0.00 8,448,235.52 47,028,951.14 55,477,186.66
Movement of beginning
balance during the period
– transfer to second stage 0.00 0.00 0.00 0.00
– transfer to third stage 0.00 0.00 0.00 0.00
– Reverse to second stage 0.00 0.00 0.00 0.00
– Reverse to first stage 0.00 0.00 0.00 0.00
Provision for the period 0.00 2,030,908.68 -158,470.77 1,872,437.91
Reversal in the period 0.00 0.00 0.00
Transfer in the period 0.00 0.00 0.00 0.00
Write-off in the period 0.00 0.00 18,556,821.63 18,556,821.63
Other movement 0.00 203,425.24 -68,646.77 134,778.47
Closing balance 0.00 10,682,569.44 28,245,011.97 38,927,581.41
Descriptions of the significant changes in the gross carrying amount of other receivables for which the changes in loss
allowance occur for the current period:
□ Applicable √ N/A
Provision for bad debts in the current period and the basis for assessing whether the credit risk of financial instruments has
increased significantly:
□ Applicable √ N/A
lnterim Report 2022 159
(5) Actual written-off of other receivables in this period
□ Applicable √ N/A
Unit: Yuan Currency: RMB
Item Amount written off
Other receivables actually written off 18,715,292.40
Significant other receivables that are written off:
□ Applicable √ N/A
Descriptions of write-off of other receivables:
□ Applicable √ N/A
(6) Other receivables due from the top five debtors
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Other Proportion to Provision for
receivables total other bad debts
Name of entity Nature Closing balance Aging receivables (%) Closing balance
Hua Xia Securities Co., Ltd. Treasury bonds 17,968,386.04 Over 5 years 20.05 17,968,386.04
and security
deposits
Tax refund on exports Export tax refund 13,916,376.41 Within 1 year 15.53 280,211.71
Guangzhou Yinhe Loan 5,000,000.00 Over 5 years 5.58 5,000,000.00
Sunshine Biological
Products Co., Ltd.
China Securities Amount of 2,429,180.84 Within 1 year 2.71 0.00
Depository and Clearing exercised options
Corporation Limited
(Shenzhen Branch)
Guangdong Blue Treasure Balance with 2,282,237.68 Within 1 year 2.55 38,113.37
Pharmaceutical Co., Ltd. associates
Total / 41,596,180.97 / 46.42 23,286,711.12
(7) Receivables involving government subsidies
□ Applicable √ N/A
(8) Other receivables derecognised due to the transfer of financial assets
□ Applicable √ N/A
(9) Assets or liabilities formed by the continuing involvement of transferred other receivables:
□ Applicable √ N/A
Other descriptions
□ Applicable √ N/A
160 Joincare Pharmaceutical Group Industry Co., Ltd.
7. Inventories
(1) Inventories by category
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the End of the Period Balance at the Beginning of the Period
Provision for Provision for
diminution Carrying diminution Carrying
Item Book balance in value amount Book balance in value amount
Raw materials 541,490,235.48 22,310,365.15 519,179,870.33 553,234,567.88 16,068,254.74 537,166,313.14
Packaging materials 150,276,691.49 7,259,384.01 143,017,307.48 125,197,237.91 7,099,883.19 118,097,354.72
Goods in process and 630,272,047.08 2,853,223.04 627,418,824.04 538,151,968.97 2,891,675.04 535,260,293.93
Proprietary semi-finished goods
Low-value consumables 73,877,997.91 28,804.49 73,849,193.42 61,806,078.47 217,760.90 61,588,317.57
Finished goods and stock 907,382,619.18 34,085,747.72 873,296,871.46 834,035,538.26 30,182,179.43 803,853,358.83
goods
Sub-contracting materials 1,178,080.36 0.00 1,178,080.36 2,251,074.26 0.00 2,251,074.26
Consumptive biological assets 12,645,273.43 0.00 12,645,273.43 12,342,303.96 0.00 12,342,303.96
Goods in transit 1,583,709.35 0.00 1,583,709.35 8,385,371.27 0.00 8,385,371.27
Total 2,318,706,654.28 66,537,524.41 2,252,169,129.87 2,135,404,140.98 56,459,753.30 2,078,944,387.68
(2) Provision for diminution in value of inventories and provision for diminution in value of contract performance costs
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the Increase during the Period Decrease during the Period Balance at the
Beginning Reversal or End of the
Item of the Period Provision Others written-off Others Period
Raw materials 16,068,254.74 8,816,432.52 0.00 2,574,322.11 0.00 22,310,365.15
Packaging materials 7,099,883.19 2,947,801.96 0.00 2,788,301.14 0.00 7,259,384.01
Goods in process and Proprietary semi- 2,891,675.04 197,665.95 0.00 236,117.95 0.00 2,853,223.04
finished goods
Low-value consumables 217,760.90 445.91 0.00 189,402.32 0.00 28,804.49
Finished goods and stock goods 30,182,179.43 16,846,294.76 0.00 12,942,726.47 0.00 34,085,747.72
Total 56,459,753.30 28,808,641.10 0.00 18,730,869.99 0.00 66,537,524.41
lnterim Report 2022 161
Provision for decline in value of inventories
Reason for reversal or written-off
of provision for decline in value of
Basis in determination of net recoverable amount/ inventories/Provision for impairment
Item residual value and cost to be incurred of contract performance cost
Raw materials The estimated selling price less the estimated costs Processing, sale of finished goods and
of completion, selling expenses and related taxes discard
Packaging materials The estimated selling price less the estimated costs Processing, sale of finished goods and
of completion, selling expenses and related taxes discard
Goods in process and The estimated selling price less the estimated costs Processing of finished goods and
Proprietary semi-finished of completion, selling expenses and related taxes discard
goods
Low-value consumables The estimated selling price less the related taxes Used or discard
Finished goods and stock The estimated selling price less the estimated Sale and discard
goods selling expenses and related taxes
(3) Descriptions at the End of the Period of inventories including capitalised amount of borrowing costs
□ Applicable √ N/A
(4) Description of amortization amount of contract performance cost in the current period
□ Applicable √ N/A
Other descriptions:
□ Applicable √ N/A
8. Non-current assets due within one year
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item End of the Period the Period
Long-term receivables due within one year 38,498.84 317,381.23
Total 38,498.84 317,381.23
Significant debt investments and other debt investments at the end of the period:
□ Applicable √ N/A
9. Other current assets
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item End of the Period the Period
Input VAT pending deduction/Input tax pending for verification 32,216,866.02 53,179,328.86
Prepaid income tax 18,454,794.32 30,667,849.83
Others 1,299,416.94 139,035.68
Total 51,971,077.28 83,986,214.37
162 Joincare Pharmaceutical Group Industry Co., Ltd.
10. Long-term receivables
(1) Descriptions of long-term receivables
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the End of the Period Balance at the Beginning of the Period
Book Provision for Carrying Book Provision for Carrying Range of
Item balance bad debts value balance bad debts value discount rate
Financing lease payments 121,073.53 0.00 121,073.53 584,285.36 0.00 584,285.36 4.75%
Less: Long-term receivables due 38,498.84 0.00 38,498.84 317,381.23 0.00 317,381.23
within one year
Total 82,574.69 0.00 82,574.69 266,904.13 0.00 266,904.13
(2) Provision for bad debts
□ Applicable √ N/A
(3) Long-term receivables derecognized due to the transfer of financial assets
□ Applicable √ N/A
(4) Assets or liabilities formed by the continuing involvement of transferred long-term receivables
□ Applicable √ N/A
Other descriptions:
□ Applicable √ N/A
11. Long-term equity investment
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Movement during the Period
Balance at Investment Announced Closing
the gain or Adjustment distribution balance of
Beginning Additions Decrease loss under in other Changes of cash Provision Balance at provision
of the in in equity comprehensive of other dividend for the End of for
Investee Period investment investment method income equity or profit impairment Others the Period impairment
I. Subsidiaries
Zhongshan Renhe Health 6,337,823.35 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 6,337,823.35 6,337,823.35
Products Co., Ltd.
Guangzhou Hiyeah 1,949,893.45 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1,949,893.45 1,949,893.45
Industry Co., Ltd.
Subtotal 8,287,716.80 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 8,287,716.80 8,287,716.80
II. Associates
Livzon Medical Electronic 1,200,000.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1,200,000.00 1,200,000.00
Equipment (Plant) Co., Ltd.
Guangdong Blue Treasure 78,029,592.18 0.00 0.00 8,449,190.92 0.00 0.00 0.00 0.00 0.00 86,478,783.10 0.00
Pharmaceutical Co. Ltd.
Shenzhen City Youbao 1,222,398.89 0.00 0.00 59,159.96 0.00 0.00 0.00 0.00 0.00 1,281,558.85 0.00
Technology Co., Ltd.
AbCyte Therapeutics Inc. 15,154,709.96 0.00 0.00 -267,465.90 0.00 0.00 0.00 0.00 0.00 14,887,244.06 0.00
lnterim Report 2022 163
Movement during the Period
Balance at Investment Announced Closing
the gain or Adjustment distribution balance of
Beginning Additions Decrease loss under in other Changes of cash Provision Balance at provision
of the in in equity comprehensive of other dividend for the End of for
Investee Period investment investment method income equity or profit impairment Others the Period impairment
L&L Biopharma, Co. Ltd. 14,886,838.46 0.00 0.00 -377,548.72 0.00 0.00 0.00 0.00 0.00 14,509,289.74 0.00
Zhuhai Sanmed Biotech 83,155,557.16 0.00 0.00 -12,522,892.78 0.00 0.00 0.00 0.00 0.00 70,632,664.38 0.00
Inc.*
Aetio Biotheraphy, Inc. 16,028,488.48 0.00 0.00 -309,835.55 0.00 0.00 0.00 0.00 0.00 15,718,652.93 0.00
Jiangsu Atom Bioscience 67,908,607.98 30,000,000.00 0.00 -850,773.32 0.00 0.00 0.00 0.00 0.00 97,057,834.66 0.00
and Pharmaceutical Co.,
Ltd.
Tianjin Tongrentang Group 751,549,763.92 0.00 0.00 46,004,235.14 2,476,997.86 0.00 51,920,000.00 0.00 0.00 748,110,996.92 0.00
Co., Ltd.*
Infinite Intelligence 19,937,909.64 0.00 0.00 -656,809.94 0.00 0.00 0.00 0.00 0.00 19,281,099.70 0.00
Pharmaceutical Co. Ltd.
Jiaozuo Jinguan Jiahua 284,619,909.01 0.00 0.00 855,150.06 0.00 0.00 0.00 0.00 0.00 285,475,059.07 0.00
Electric Power Co., Ltd.
Ningbo Ningrong 27,464,098.71 0.00 0.00 -203,057.33 0.00 0.00 0.00 0.00 0.00 27,261,041.38 0.00
Biomedical Co., Ltd.
Feellife Health Inc. 12,734,373.22 0.00 0.00 749,101.62 0.00 0.00 0.00 0.00 0.00 13,483,474.84 0.00
Novastage Pharmaceuticals 18,080,883.21 0.00 18,080,883.21 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
(Shenzhen), Ltd.
Jiangsu Baining 28,576,324.02 0.00 0.00 280,033.64 0.00 0.00 0.00 0.00 0.00 28,856,357.66 0.00
Yingchuang Medical
Technology Co., Ltd.
Subtotal 1,420,549,454.84 30,000,000.00 18,080,883.21 41,208,487.80 2,476,997.86 0.00 51,920,000.00 0.00 0.00 1,424,234,057.29 1,200,000.00
Total 1,428,837,171.64 30,000,000.00 18,080,883.21 41,208,487.80 2,476,997.86 0.00 51,920,000.00 0.00 0.00 1,432,521,774.09 9,487,716.80
Other descriptions:
Note 1. In January 2022, Zhuhai Lizhu pharmaceutical Equity Investment Management Co., Ltd., a subsidiary of Livzon
group, increased the capital of Jiangsu Atom Bioscience and Pharmaceutical Co., Ltd. by 30 million. After the capital
increase, the shareholding ratio was 7.4858%, and the industrial and commercial registration has been completed.
Note 2. In January 2022, the company signed an equity transfer agreement with Tang Jiansheng to transfer all the equity of
Xinling Pharmaceutical Technology (Shenzhen) Co., Ltd. to Tang Jiansheng. The equity transfer payment has been received
and the industrial and commercial registration has been completed.
164 Joincare Pharmaceutical Group Industry Co., Ltd.
12. Other equity instrument investments
(1) Descriptions of other equity investment
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of the
Item End of the Period Period
China Galaxy Securities Co., Ltd. 0.00 212,384,666.97
Shanghai Yunfeng Xinchuang Equity Investment Center 69,006,351.58 94,040,236.88
Shanghai JingYi Investment Center 67,979,475.21 66,175,062.50
Qianhai Equity Investment Fund 264,930,500.00 264,930,500.00
Apricot Forest, Inc 137,711,800.01 137,711,800.01
PANTHEON D,L.P. 7,924,639.91 3,715,566.69
Zhuhai China Resources Bank Co., Ltd. 164,395,200.00 164,395,200.00
GLOBAL HEALTH SCIENCE 222,393,107.44 235,133,216.46
SCC VENTURE VI 2018-B,L.P. 6,963,959.64 6,615,626.07
Nextech V Oncology S.C.S., SICAV-SIF 32,640,308.82 30,667,263.04
Yizun Biopharmaceutics (Shanghai) Co., Ltd. 59,999,953.41 59,999,953.41
ELICIO THERAPEUTICS, INC. 33,557,014.21 31,878,510.16
CARIAMA THER APEUTICS INC. 33,555,357.83 31,876,936.63
Beijing Luzhu Biotechnology Co., Ltd. 41,944,015.67 41,944,015.67
Shanghai Keentai Biotechnology Co., Ltd. 12,000,000.00 12,000,000.00
Others 15,556,583.34 15,413,822.93
Total 1,170,558,267.07 1,408,882,377.42
lnterim Report 2022 165
(2) Descriptions of investments in non-trading equity instruments
√ Applicable □ N/A
Amount
transferred Reason for
from other transfer as
Dividend comprehensive fair value
income income to through other
recognized for Cumulative Cumulative retained Reason for the comprehensive
Item the Period gains losses earning designation income
China Galaxy Securities Co., Ltd. 0.00 0.00 0.00 94,089,666.09 non-trading Disposal
Shanghai Yunfeng Xinchuang Equity 0.00 0.00 0.00 -7,912,029.31 non-trading Disposal
Investment Center
Shanghai JingYi Investment Center 0.00 0.00 0.00 0.00 non-trading
Qianhai Equity Investment Fund 8,713,730.74 0.00 0.00 0.00 non-trading
Apricot Forest, Inc 0.00 0.00 0.00 0.00 non-trading
PANTHEON D,L.P. 0.00 0.00 0.00 0.00 non-trading
Zhuhai China Resources Bank Co., Ltd. 0.00 0.00 0.00 0.00 non-trading
GLOBAL HEALTH SCIENCE 0.00 0.00 0.00 0.00 non-trading
SCC VENTURE VI 2018-B,L.P. 0.00 0.00 0.00 0.00 non-trading
Nextech V Oncology S.C.S., SICAV-SIF 0.00 0.00 0.00 0.00 non-trading
Yizun Biopharmaceutics (Shanghai) Co., 0.00 0.00 0.00 0.00 non-trading
Ltd.
ELICIO THERAPEUTICS, INC. 0.00 0.00 0.00 0.00 non-trading
CARIAMA THER APEUTICS INC. 0.00 0.00 0.00 0.00 non-trading
Beijing Luzhu Biotechnology Co., Ltd. 0.00 0.00 0.00 0.00 non-trading
Shanghai Keentai Biotechnology Co., 0.00 0.00 0.00 0.00 non-trading
Ltd.
Others 0.00 0.00 0.00 0.00 non-trading
Total 8,713,730.74 0.00 0.00 86,177,636.78
Other descriptions:
□ Applicable √ N/A
166 Joincare Pharmaceutical Group Industry Co., Ltd.
13. Investment properties
Measurement of investment properties
(1) Investment properties measured at cost
Unit: Yuan Currency: RMB
Item Housing and buildings Total
I. Book value:
1. Beginning balance 61,914,754.28 61,914,754.28
2. Increase 0.00 0.00
3. Decrease 0.00 0.00
4. Closing balance 61,914,754.28 61,914,754.28
II. Accumulated depreciation and amortisation
1. Beginning balance 55,723,278.85 55,723,278.85
2. Increase 0.00 0.00
(1) Amortisation for the period 0.00 0.00
3. Decrease 0.00 0.00
(1) Disposal 0.00 0.00
4. Closing balance 55,723,278.85 55,723,278.85
III. Provision for impairment
1. Beginning balance 0.00 0.00
2. Increase 0.00 0.00
(1) Provision 0.00 0.00
3. Decrease 0.00 0.00
(1) Disposal 0.00 0.00
4. Closing balance 0.00 0.00
IV. Carrying amount
1. Carrying value at period end 6,191,475.43 6,191,475.43
2. Carrying value at beginning of the period 6,191,475.43 6,191,475.43
(2) Investment properties whose title certificate has not completed:
□ Applicable √ N/A
Other descriptions:
□ Applicable √ N/A
14. Fixed assets
Line items
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item End of the Period the Year
Fixed assets 4,742,112,777.95 4,839,005,169.81
Fixed assets for disposal 0.00 0.00
Total 4,742,112,777.95 4,839,005,169.81
lnterim Report 2022 167
Fixed assets
(1) Details of fixed assets
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Electronic
Housing and Machinery and equipment
Item buildings equipment Motor vehicles and others Total
I. Book value:
1. Beginning balance 3,976,199,210.91 5,119,816,758.02 108,015,330.21 783,366,162.98 9,987,397,462.12
2. Increase 16,987,642.59 145,528,062.21 2,686,703.98 47,333,758.14 212,536,166.92
(1) Purchase 1,640,224.66 66,081,533.52 2,100,072.20 36,776,040.68 106,597,871.06
(2) Transfer from construction in progress 15,347,417.93 79,446,528.69 0.00 10,520,893.09 105,314,839.71
(3) Others 0.00 0.00 586,631.78 36,824.37 623,456.15
3. Decrease 1,401,442.20 27,348,770.54 3,975,785.05 9,397,644.21 42,123,642.00
(1) Disposal or scrap 1,401,442.20 27,348,770.54 3,975,785.05 9,397,644.21 42,123,642.00
(2) Others 0.00 0.00 0.00 0.00 0.00
4. Closing balance 3,991,785,411.30 5,237,996,049.69 106,726,249.14 821,302,276.91 10,157,809,987.04
II. Accumulated depreciation
1. Beginning balance 1,633,263,266.38 2,850,461,052.50 76,499,140.97 478,176,262.36 5,038,399,722.21
2. Increase 88,591,976.23 167,264,766.79 5,243,765.58 36,872,592.45 297,973,101.05
(1) Provision 88,591,976.23 167,264,766.79 4,664,718.48 36,835,768.08 297,357,229.58
(2) Other increase 0.00 0.00 579,047.10 36,824.37 615,871.47
3. Decrease 553,160.81 15,980,583.16 3,652,520.20 8,504,096.64 28,690,360.81
(1) Disposal or scrap 553,160.81 15,980,583.16 3,652,520.20 8,504,096.64 28,690,360.81
(2) Others 0.00 0.00 0.00 0.00 0.00
4. Closing balance 1,721,302,081.80 3,001,745,236.13 78,090,386.35 506,544,758.17 5,307,682,462.45
III. Provision for impairment
1. Beginning balance 26,564,784.45 64,186,228.26 41,578.65 19,199,978.74 109,992,570.10
2. Increase 0.00 0.00 0.00 0.00 0.00
(1) Provision 0.00 0.00 0.00 0.00 0.00
3. Decrease 0.00 1,967,903.15 0.00 9,920.31 1,977,823.46
(1) Disposal or scrap 0.00 1,967,903.15 0.00 9,920.31 1,977,823.46
4. Closing balance 26,564,784.45 62,218,325.11 41,578.65 19,190,058.43 108,014,746.64
IV. Carrying amount
1. Carrying value at period end 2,243,918,545.05 2,174,032,488.45 28,594,284.14 295,567,460.31 4,742,112,777.95
2. Carrying value at beginning of the 2,316,371,160.08 2,205,169,477.26 31,474,610.59 285,989,921.88 4,839,005,169.81
period
168 Joincare Pharmaceutical Group Industry Co., Ltd.
(2) Fixed assets with temporary idle
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Accumulated Provision for Carrying
Item Book value depreciation impairment amount Note
Housing and buildings 23,926,279.99 14,477,225.44 5,155,770.80 4,293,283.75
Machinery and equipment 176,823,529.41 127,444,897.48 36,626,874.85 12,751,757.08
Electronic equipment and others 3,125,233.36 2,677,764.68 174,034.89 273,433.79
Total 203,875,042.76 144,599,887.60 41,956,680.54 17,318,474.62
(3) Fixed assets held under finance leases
□ Applicable √ N/A
(4) Fixed assets leased out under operating leases
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Item Carrying Amount
Housing and buildings 1,755,573.68
(5) Fixed assets without property certificate
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Reason for pending for
Item Carrying Amount certificate of ownership
Housing and buildings 263,540,166.29 Application in progress
Other descriptions
□ Applicable √ N/A
Disposal of fixed assets
□ Applicable √ N/A
15. Construction in progress
Line items
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item End of the Period the Period
Construction in progress 1,137,740,068.11 742,533,534.23
Construction materials 464,794.99 465,209.52
Total 1,138,204,863.10 742,998,743.75
lnterim Report 2022 169
Construction in progress
(1) Descriptions of construction in progress
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the End of the Period Balance at the Beginning of the Period
Provision for Provision for
Item Book balance impairment Net book value Book balance impairment Net book value
Haibin Pharma Pingshang New 214,422,917.60 0.00 214,422,917.60 144,364,877.42 0.00 144,364,877.42
Factory
Guangda New Factory Project 244,731,213.54 0.00 244,731,213.54 179,745,064.48 0.00 179,745,064.48
Fuxing Company Phase I & II 55,792,535.39 0.00 55,792,535.39 36,580,114.83 0.00 36,580,114.83
Projects and others
Project of Shijiao New Factory 67,954,038.81 0.00 67,954,038.81 61,845,397.73 0.00 61,845,397.73
Transformation Project of 38,783,326.13 0.00 38,783,326.13 19,579,452.17 0.00 19,579,452.17
Pharmaceutical Factory
Workshop
Construction Project for 46,447,337.04 0.00 46,447,337.04 15,616,651.12 0.00 15,616,651.12
Microsphere Workshop (including
Gose) of Livzon Group Livzon
Pharmaceutical Factory
P06 Construction Project 90,092,594.58 0.00 90,092,594.58 83,020,966.01 0.00 83,020,966.01
of Livzon Group Livzon
Pharmaceutical Factory
Project of lyophilized powder 120,126,722.32 0.00 120,126,722.32 70,673,332.62 0.00 70,673,332.62
injection workshop
P09 Construction Project 129,454,273.32 0.00 129,454,273.32 54,924,595.61 0.00 54,924,595.61
of Livzon Group Livzon
Pharmaceutical Factory
P04/P05 Construction Project 469,262.41 0.00 469,262.41 257,441.66 0.00 257,441.66
of Livzon Group Livzon
Pharmaceutical Factory
Technology transformation 25,856,843.52 0.00 25,856,843.52 10,123,776.54 0.00 10,123,776.54
project for Microsphere Phase II
of Shanghai Livzon
Others 103,778,343.91 169,340.46 103,609,003.45 65,971,204.50 169,340.46 65,801,864.04
Total 1,137,909,408.57 169,340.46 1,137,740,068.11 742,702,874.69 169,340.46 742,533,534.23
170 Joincare Pharmaceutical Group Industry Co., Ltd.
(2) Changes in significant construction in progress
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance Balance Proportion
at the at the of Cumulative Interest Including:
Beginning Transfer End cumulative amount of capitalisation interest
of the to fixed Other of the input to interest rate for the capitalised
Project item Budget Period Increase assets decrease Period budget Progress capitalised year in the year Source of fund
(%) (%) (%)
Haibin Pharma Pingshang New Factory 1,037,000,000.00 144,364,877.42 123,347,091.24 20,905,937.36 32,383,113.70 214,422,917.60 70.08 Completion of some 0.00 0.00 0.00 Self-funding and
projects funds raised
Guangda New Factory Project 646,000,000.00 179,745,064.48 64,986,149.06 0.00 0.00 244,731,213.54 37.88 Under construction 0.00 0.00 0.00 Self-funding
Fuxing Company Phase I & II Projects and 378,090,800.00 36,580,114.83 42,774,239.62 23,561,819.06 0.00 55,792,535.39 78.39 Completion of some 0.00 0.00 0.00 Self-funding
others projects
Project of Shijiao New Factory 377,005,000.00 61,845,397.73 6,108,641.08 0.00 0.00 67,954,038.81 61.50 Completion of some 0.00 0.00 0.00 Self-funding and
projects funds raised
Transformation Project of Pharmaceutical 306,558,388.48 19,579,452.17 38,569,073.78 19,365,199.82 0.00 38,783,326.13 50.60 Completion of some 0.00 0.00 0.00 Self-funding
Factory Workshop projects
Construction Project for Microsphere 262,445,000.00 15,616,651.12 35,779,491.04 4,948,805.12 0.00 46,447,337.04 67.59 Completion of some 0.00 0.00 0.00 Self-funding and
Workshop (including Gose) of Livzon Group projects funds raised
Livzon Pharmaceutical Factory
P06 Construction Project of Livzon Group 117,710,000.00 83,020,966.01 7,071,628.57 0.00 0.00 90,092,594.58 76.54 Under construction 0.00 0.00 0.00 Self-funding
Livzon Pharmaceutical Factory
Project of lyophilized powder injection 143,500,000.00 70,673,332.62 49,453,389.70 0.00 0.00 120,126,722.32 83.71 Under construction 0.00 0.00 0.00 Self-funding and
workshop funds raised
P09 Construction Project of Livzon Group 296,580,000.00 54,924,595.61 89,157,562.20 14,627,884.49 0.00 129,454,273.32 98.82 Under construction 0.00 0.00 0.00 Self-funding
Livzon Pharmaceutical Factory
P04/P05 Construction Project of Livzon 126,880,000.00 257,441.66 211,820.75 0.00 0.00 469,262.41 0.37 Under construction 0.00 0.00 0.00 Self-funding
Group Livzon Pharmaceutical Factory
Technology transformation project for 40,500,000.00 10,123,776.54 15,733,066.98 0.00 0.00 25,856,843.52 63.84 Under construction 0.00 0.00 0.00 Self-funding
Microsphere Phase II of Shanghai Livzon
Others 65,971,204.50 71,708,326.33 21,905,193.86 11,995,993.06 103,778,343.91 0.00 0.00 0.00 Self-funding
Total 3,732,269,188.48 742,702,874.69 544,900,480.35 105,314,839.71 44,379,106.76 1,137,909,408.57 0.00 0.00 0.00 –
Other decrease is mainly transferred to long-term deferred expenses.
(3). Provision for impairment of construction in progress in the current period
□ Applicable √ N/A
Other descriptions:
□ Applicable √ N/A
lnterim Report 2022 171
16. Right-of-use assets
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Housing and
Item buildings Total
I. Book value:
1. Beginning balance 69,960,518.27 69,960,518.27
2. Increase 16,013,133.16 16,013,133.16
(1) Leasing 16,013,133.16 16,013,133.16
3. Decrease 4,538,405.42 4,538,405.42
4. Closing balance 81,435,246.01 81,435,246.01
II. Accumulated depreciation
1. Beginning balance 23,185,758.57 23,185,758.57
2. Increase 16,158,894.05 16,158,894.05
(1) Provision 16,158,894.05 16,158,894.05
3. Decrease 3,550,845.91 3,550,845.91
4. Closing balance 35,793,806.71 35,793,806.71
III. Provision for impairment
1. Beginning balance 0.00 0.00
2. Increase 0.00 0.00
3. Decrease 0.00 0.00
4. Closing balance 0.00 0.00
IV. Carrying amount
1. Carrying value at period end 45,641,439.30 45,641,439.30
2. Carrying value at beginning of the period 46,774,759.69 46,774,759.69
Other descriptions:
As of 30 June 2022, the Company recognised lease expenses related to short-term leases and the leases of low value assets
of RMB2,392,800.
172 Joincare Pharmaceutical Group Industry Co., Ltd.
17. Intangible assets
(1) Details of intangible assets
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Patent and
technical Trademark
Item Land use rights know-how Software rights Others Total
I. Book value
1. Beginning balance 413,762,737.87 519,813,876.67 79,232,390.69 62,769,716.98 10,985,294.53 1,086,564,016.74
2. Increase 24,832,070.29 25,738,583.67 9,145,484.51 0.00 0.00 59,716,138.47
(1) Purchase 24,832,070.29 0.00 9,145,484.51 0.00 0.00 33,977,554.80
(2) Internal R&D 0.00 25,738,583.67 0.00 0.00 0.00 25,738,583.67
3. Decrease 0.00 0.00 0.00 0.00 0.00 0.00
(1) Disposal 0.00 0.00 0.00 0.00 0.00 0.00
(2) Change in scope of 0.00 0.00 0.00 0.00 0.00 0.00
consolidation
4. Closing balance 438,594,808.16 545,552,460.34 88,377,875.20 62,769,716.98 10,985,294.53 1,146,280,155.21
II. Accumulated amortisation
1. Beginning balance 122,997,170.29 369,635,517.03 56,287,892.35 62,765,196.55 5,584,191.37 617,269,967.59
2. Increase 4,542,730.55 20,616,662.20 3,396,062.32 235.86 549,264.72 29,104,955.65
Provision 4,542,730.55 20,616,662.20 3,396,062.32 235.86 549,264.72 29,104,955.65
3. Decrease 0.00 0.00 0.00 0.00 0.00 0.00
(1) Disposal 0.00 0.00 0.00 0.00 0.00 0.00
(2) Change in scope of 0.00 0.00 0.00 0.00 0.00 0.00
consolidation
4. Closing balance 127,539,900.84 390,252,179.23 59,683,954.67 62,765,432.41 6,133,456.09 646,374,923.24
III. Provision for impairment
1. Beginning balance 981,826.94 11,530,127.41 0.00 0.00 0.00 12,511,954.35
2. Increase 0.00 0.00 0.00 0.00 0.00 0.00
Provision 0.00 0.00 0.00 0.00 0.00 0.00
3. Decrease 0.00 0.00 0.00 0.00 0.00 0.00
4. Closing balance 981,826.94 11,530,127.41 0.00 0.00 0.00 12,511,954.35
IV. Carrying amount
1. Carrying value at period end 310,073,080.38 143,770,153.70 28,693,920.53 4,284.57 4,851,838.44 487,393,277.62
2. Carrying value at beginning of 289,783,740.64 138,648,232.23 22,944,498.34 4,520.43 5,401,103.16 456,782,094.80
the period
The proportion of intangible assets created due to the internal R&D in the balance of intangible assets at the End of the
Period is 22.76%.
lnterim Report 2022 173
(2) Intangible assets pending for certificates of ownership
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Item Carrying amount Reasons for pending title certificate
Land use rights 4,101,535.62 Application in progress
Other descriptions
√ Applicable □ N/A
The land use rights represent the state-owned land use rights obtained by the Company in accordance with PRC laws in
China, and the term of grant will be 50 years commencing from the date of obtaining the land use rights.
18. Development Costs
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Increase for the Period Decrease for the Period
Balance at the Internal Recognised in Balance at
Beginning of development Recognized as profit or loss the End of
Item the Period costs Other increase intangible assets in the year the Period
Chemical pharmaceuticals 179,411,666.34 56,328,213.56 0.00 25,738,583.67 51,139,662.12 158,861,634.11
Biologics 213,102,130.11 14,538,062.23 0.00 0.00 0.00 227,640,192.34
Vaccine 314,172,937.62 67,659,803.79 0.00 0.00 0.00 381,832,741.41
APIs and others 80,306,701.64 14,869,016.05 0.00 0.00 5,173,934.64 90,001,783.05
Total 786,993,435.71 153,395,095.63 0.00 25,738,583.67 56,313,596.76 858,336,350.91
Other descriptions:
Time for commencement of Progress of research and
Item capitalisation Specific basis of capitalisation development at year end
Chemical pharmaceuticals Clinical trial Obtain approval for clinical trial Clinical stage
Biologics Clinical trial Obtain approval for clinical trial Clinical stage
Vaccine Clinical trial Obtain approval for clinical trial Clinical stage
APIs and others Pilot stage Pilot related information Post-pilot stage
174 Joincare Pharmaceutical Group Industry Co., Ltd.
19. Goodwill
(1) Book value of goodwill
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Increase for the Period Decrease for the Period
Balance at the Formation by Balance at
Name of investee or matter from Beginning of business the End of
which goodwill arose the Period combination Others Disposal Others the Period
Shanghai Livzon Pharmaceutical Manufacturing Co., Ltd. 2,045,990.12 0.00 0.00 0.00 0.00 2,045,990.12
Zhuhai FTZ Livzon Hecheng Pharmaceutical 3,492,752.58 0.00 0.00 0.00 0.00 3,492,752.58
Manufacturing Co., Ltd.
Sichuan Guangda Pharmaceutical Manufacturing Co., Ltd. 13,863,330.24 0.00 0.00 0.00 0.00 13,863,330.24
Livzon Group Xinbeijiang Pharmaceutical Manufacturing 7,271,307.03 0.00 0.00 0.00 0.00 7,271,307.03
Inc.
Livzon Group Fuzhou Fuxing Pharmaceutical Co., Ltd. 46,926,155.25 0.00 0.00 0.00 0.00 46,926,155.25
Livzon Group Livzon Pharmaceutical Factory 47,912,269.66 0.00 0.00 0.00 0.00 47,912,269.66
Livzon Group 395,306,126.41 0.00 0.00 0.00 0.00 395,306,126.41
Shenzhen Haibin Pharmaceutical Co., Ltd. 91,878,068.72 0.00 0.00 0.00 0.00 91,878,068.72
Joincare Daily-Use & Health Care Co., Ltd. 1,610,047.91 0.00 0.00 0.00 0.00 1,610,047.91
Shenzhen Taitai Pharmaceutical Co., Ltd. 635,417.23 0.00 0.00 0.00 0.00 635,417.23
Health Pharmaceuticals (China) Limited 23,516,552.65 0.00 0.00 0.00 0.00 23,516,552.65
Shenzhen Hiyeah Industry Co., Ltd 6,000,000.00 0.00 0.00 0.00 0.00 6,000,000.00
Jiaozuo Joincare Bio Technological Co., Ltd. 92,035.87 0.00 0.00 0.00 0.00 92,035.87
Total 640,550,053.67 0.00 0.00 0.00 0.00 640,550,053.67
(2) Provision for impairment of goodwill
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at Increase for the Period Decrease for the Period Balance at
the Beginning of the End of
Investee or matters formed the goodwill the Period Provision Others Disposal Others the Period
Livzon Group Xinbeijiang Pharmaceutical 7,271,307.03 0.00 0.00 0.00 0.00 7,271,307.03
Manufacturing Inc.
Livzon Group Fuzhou Fuxing 11,200,000.00 0.00 0.00 0.00 0.00 11,200,000.00
Pharmaceutical Co., Ltd.
Shenzhen Hiyeah Industry Co., Ltd 6,000,000.00 0.00 0.00 0.00 0.00 6,000,000.00
Joincare Daily-Use & Health Care Co., Ltd. 1,610,047.91 0.00 0.00 0.00 0.00 1,610,047.91
Total 26,081,354.94 0.00 0.00 0.00 0.00 26,081,354.94
(3) Relevant information regarding the asset portfolio and set of asset portfolios to which the goodwill belongs
√ Applicable □ N/A
Goodwill of the Company arose from its business combination involving enterprises not under common control in
previous years.
lnterim Report 2022 175
(4) Descriptions of the process of goodwill impairment testing, key parameters (such as the growth rate of the forecast period,
the growth rate of the stable period, the profit rate, the discount rate and the forecast period, etc. when the present value
of future cash flows are expected, if applicable) and the recognition method of the impairment losses on goodwill
√ Applicable □ N/A
On the balance sheet date, the Company conducts an impairment test on goodwill. When estimating the recoverable
amount of input costs, it uses a assets group related to goodwill to estimate the present value of future cash flows.
The estimated future cash flow of asset groups is calculated according to the five-year financial budget plan made by the
management, the cash flows in the years beyond the five-year budget plan remain stable.
Key assumptions of discounted future cash flow for goodwill impairment test are as follows:
For the calculation of estimated present value of future cash flow of the asset groups related to goodwill of Livzon Group,
key assumptions are a gross margin of 63.24%-63.43% and a business revenue growth rate of 0-9.07% as well as a cash
flow discount rate of 12.99%. The management took into account historical conditions and predictions for future market
development in making the above assumptions.
For the calculation of estimated present value of future cash flow of the asset groups related to goodwill of Shenzhen
Haibin Pharmaceutical Co., Ltd. (深圳市海滨制药有限公司), key assumptions are a gross margin of 58.33%-59.13% and
a business revenue growth rate of 0-5.27% as well as a cash flow discount rate of 11.78%. The management took into
account historical conditions and predictions for future market development in making the above assumptions.
As tested, the management of the Company expects that no impairment provision is needed during the period.
(5) The impact of goodwill impairment test
□ Applicable √ N/A
Other descriptions:
□ Applicable √ N/A
20. Long-term deferred expenses
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the Balance at
Beginning of Other the End of
Item the Period Increase Amortisation decrease the Period
Renovation costs of offices 26,940,700.02 1,624,869.15 1,752,302.84 0.00 26,813,266.33
Renovation costs of plants 78,337,095.23 31,014,325.77 12,732,418.83 0.00 96,619,002.17
Plants reconstruction 60,368,163.71 0.00 1,461,035.72 0.00 58,907,127.99
project
Certification costs of GMP 311,654.79 0.00 60,320.28 0.00 251,334.51
project
Others 34,758,127.18 11,637,488.16 8,812,512.70 0.00 37,583,102.64
Total 200,715,740.93 44,276,683.08 24,818,590.37 0.00 220,173,833.64
176 Joincare Pharmaceutical Group Industry Co., Ltd.
21. Deferred tax assets and deferred tax liabilities
(1) Deferred tax assets before offsetting
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the End of the Period Balance at the Beginning of the Period
Deductible Deferred Deductible Deferred
Item timing differences tax assets timing differences tax assets
Provision for impairment of assets 319,543,705.42 53,265,222.24 323,372,877.26 54,704,601.96
Accrued expenses 943,927,069.68 168,472,108.29 945,774,497.50 166,481,490.01
Deductible tax loss 628,988,008.18 106,750,561.99 497,850,865.29 84,167,365.69
Deferred income 388,228,236.56 62,715,785.49 375,321,674.10 60,145,851.14
Unrealised gains from intra- 802,993,093.55 120,336,149.12 560,934,298.63 84,185,529.66
company transactions
Changes in fair value of other 133,008,102.67 33,252,025.67 146,653,568.40 36,663,392.10
equity instrument investments
Deductible difference arising from 78,252,770.29 11,864,488.78 77,872,943.63 11,933,224.52
share incentive expenses
Changes in fair value of financial 17,654,550.12 2,938,251.93 6,918,505.67 1,158,336.82
assets held for trading
Other deductible temporary 374,001,517.03 73,784,263.30 282,821,670.90 53,103,074.81
difference
Total 3,686,597,053.50 633,378,856.81 3,217,520,901.38 552,542,866.71
(2) Deferred tax liabilities before offsetting
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the End of the Period Balance at the Beginning of the Period
Taxable timing Deferred Taxable timing Deferred
Item difference tax liabilities difference tax liabilities
Changes in fair value of financial 16,507,990.79 2,556,409.29 19,970,547.94 3,215,329.05
assets held for trading
Accelerated depreciation of fixed 744,846,785.16 112,897,099.81 752,180,706.08 114,114,492.09
assets
Changes in fair value of other 230,707,941.33 39,248,538.17 359,110,036.65 70,405,084.25
equity instrument investments
Unrealised gains from intra- 105,940,000.00 20,791,000.00 105,940,000.00 20,791,000.00
company transactions
Total 1,098,002,717.28 175,493,047.27 1,237,201,290.67 208,525,905.39
(3) Deferred income tax assets or liabilities listed as net amount after offset
□ Applicable √ N/A
lnterim Report 2022 177
(4) Details of unrecognized deferred tax assets
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item End of the Period the Period
Deductible temporary difference 194,378,204.58 175,707,417.84
Deductible tax losses 1,682,454,124.29 1,365,909,940.62
Total 1,876,832,328.87 1,541,617,358.46
(5) Expiry of deductible tax losses in subsequent period
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Year End of the Period the Period Note
2022 129,386,282.89 129,386,282.40
2023 182,300,762.40 182,300,761.96
2024 385,139,111.62 385,138,859.92
2025 254,439,677.09 254,360,863.53
2026 393,596,990.55 389,994,598.37
2027 232,550,613.10 0.00
Indefinite 105,040,686.64 24,728,574.44
Total 1,682,454,124.29 1,365,909,940.62
Other descriptions:
□ Applicable √ N/A
22. Other non-current assets
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the End of the Period Balance at the Beginning of the Period
Provision for Carrying Provision for Carrying
Item Book Balance impairment amount Book Balance impairment amount
Term deposit and interests 53,140,277.78 0.00 53,140,277.78 52,127,500.00 0.00 52,127,500.00
VAT carry forward 7,172,520.86 0.00 7,172,520.86 56,384,552.60 0.00 56,384,552.60
Prepayment for acquisition of 400,810,146.41 0.00 400,810,146.41 491,703,933.59 0.00 491,703,933.59
project and equipment
Prepayment for acquisition of 50,437,334.38 0.00 50,437,334.38 63,368,017.61 0.00 63,368,017.61
technical know-how
Total 511,560,279.43 0.00 511,560,279.43 663,584,003.80 0.00 663,584,003.80
178 Joincare Pharmaceutical Group Industry Co., Ltd.
23. Short-term loans
(1) Short-term loans by category
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item End of the Period the Period
Unsecured loans 1,982,775,000.02 1,666,838,964.15
Guaranteed loans 0.00 851,645,870.94
Total 1,982,775,000.02 2,518,484,835.09
(2) Overdue short-term loans
□ Applicable √ N/A
Other descriptions:
□ Applicable √ N/A
24. Financial liabilities held for trading
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at Balance at
the Beginning the End of
Item of the Period Increase Decrease the Period
Financial liabilities held for trading 143,302.24 10,647,736.16 0.00 10,791,038.40
Including:
Derivative financial liabilities 143,302.24 10,647,736.16 0.00 10,791,038.40
Total 143,302.24 10,647,736.16 0.00 10,791,038.40
Other descriptions:
Derivative financial liabilities represent foreign currency forward contracts. The loss from unexpired onerous contracts
measured at fair value on balance sheet date was recognised as financial liabilities held for trading.
25. Notes payable
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Type End of the Period the Period
Bank acceptance bills 1,601,063,168.35 1,582,386,767.93
Total 1,601,063,168.35 1,582,386,767.93
The total of bills payable due but not yet paid during the period is RMB0.00.
lnterim Report 2022 179
26. Accounts payable
(1) Presentations of accounts payable
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item End of the Period the Period
Within 1year 849,420,487.04 809,539,858.35
Over 1 year 83,854,724.72 62,013,352.16
Total 933,275,211.76 871,553,210.51
(2) Significant accounts payable aged aging over one year
□ Applicable √ N/A
Other descriptions:
□ Applicable √ N/A
27. Contract liabilities
(1) Descriptions of contract liabilities
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item End of the Period the Period
Within 1 year 71,225,218.75 208,025,612.34
Over 1 year 29,479,039.49 26,115,089.95
Total 100,704,258.24 234,140,702.29
(2) Significant changes in the carrying amount during the Reporting Period and reasons therefor
□ Applicable √ N/A
Other descriptions:
√ Applicable □ N/A
As at the End of the Period, there was no significant contract liabilities with Aging for more than 1 year at the end of
the period. The amount of contract liabilities at beginning of the period recognised as revenue during the period is
RMB190,765,419.73.
180 Joincare Pharmaceutical Group Industry Co., Ltd.
28. Employee benefits payables
(1) Descriptions of employee benefits payables
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the Balance at
Beginning of the End of
Item the Period Increase Decrease the Period
I. Short-term employee benefits 473,806,357.40 1,148,748,952.64 1,248,238,817.59 374,316,492.45
II. Post-employment benefits -Defined 341,723.80 67,046,246.89 67,387,556.89 413.80
contribution plans
III. Termination benefits 1,282,742.00 90,466.00 90,466.00 1,282,742.00
Total 475,430,823.20 1,215,885,665.53 1,315,716,840.48 375,599,648.25
(2) Descriptions of Short-term employee benefits
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the Balance at
Beginning of Increase Decrease the End of
Item the Period for the Period for the Period the Period
I Salaries, bonus and allowances 325,123,978.13 980,622,250.71 1,078,207,277.75 227,538,951.09
II Staff welfare 5,352,134.66 29,556,528.19 29,832,718.53 5,075,944.32
III Social insurances 569,488.75 25,771,265.89 25,962,009.81 378,744.83
Including: 1. Medical insurance 467,562.91 22,989,302.05 23,178,174.82 278,690.14
2. Work injury insurance 62,711.37 1,277,241.35 1,281,491.57 58,461.15
3. Maternity insurance 39,214.47 1,504,722.49 1,502,343.42 41,593.54
IV Housing fund 1,493,719.88 25,479,834.86 25,474,436.46 1,499,118.28
V Union funds and staff education 541,564.60 2,863,628.63 3,002,375.04 402,818.19
VI Stock Ownership Plan Special Fund 140,725,471.38 84,455,444.36 85,760,000.00 139,420,915.74
Total 473,806,357.40 1,148,748,952.64 1,248,238,817.59 374,316,492.45
(3) Defined contribution plans
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the Balance at
Beginning of the End of
Item the Period Increase Decrease the Period
Post-employment benefits
Including: 1. Basic pension insurance 303,582.07 65,273,430.40 65,576,598.67 413.80
2. Unemployment insurance 38,141.73 1,772,816.49 1,810,958.22 0.00
Total 341,723.80 67,046,246.89 67,387,556.89 413.80
Other descriptions:
√ Applicable □ N/A
lnterim Report 2022 181
The Company participates in pension insurance and unemployment insurance plans established by the government
in accordance with relevant requirements. According to the plans, the Company makes contributions to these plans in
accordance with relevant requirements of the local government. Save for the above contributions, the Company no longer
undertakes further payment obligation. The corresponding cost is charged to the profit or loss for the current period or
the cost of relevant assets when it occurs.
29. Taxes payable
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item End of the Period the Period
Value added tax 112,926,445.66 91,860,518.74
Enterprise income tax 209,788,306.89 145,106,168.70
Individual income tax 64,079,500.84 9,991,974.56
Urban maintenance and construction tax 11,360,588.54 10,047,715.71
Property tax 8,707,755.51 2,178,644.31
Land use tax 3,042,691.51 1,716,626.70
Stamp duty 846,515.07 676,792.62
Education surcharges 7,097,530.94 6,594,414.24
Others 2,285,172.04 2,445,327.83
Total 420,134,507.00 270,618,183.41
30. Other payables
Line items
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item End of the Period the Period
Dividends payable 24,631,984.46 6,951,984.46
Other payables 3,373,726,012.22 3,285,456,005.33
Total 3,398,357,996.68 3,292,407,989.79
Dividends payable
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item End of the Period the Period
Common shares dividend 20,174.46 20,174.46
Dividends payable – Qingyuan Xinbeijiang (Group) Company 1,200,710.00 1,200,710.00
Dividends payable – Other legal persons and individual shares of subsidiaries 12,351,300.00 3,311,300.00
Dividends payable – Staff shares of subsidiaries 11,059,800.00 2,419,800.00
Total 24,631,984.46 6,951,984.46
182 Joincare Pharmaceutical Group Industry Co., Ltd.
Other payables
(1) Other payables by nature
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item End of the Period the Period
Office expenses 60,537,028.88 66,603,733.56
Security deposits 84,212,943.40 85,316,947.15
Business promotion expenses 1,625,250,668.49 1,385,121,675.36
Technology transfer fee 10,000,000.00 10,000,000.00
Accrued expenses 1,546,261,405.35 1,696,272,218.54
Others 47,463,966.10 42,141,430.72
Total 3,373,726,012.22 3,285,456,005.33
The obligations of repurchasing restricted shares of the directors, the senior management and their spouses amounted
RMB0.00 at the End of the Period.
(2) Significant other payables aged over 1 year
□ Applicable √ N/A
Other descriptions:
√ Applicable □ N/A
Of which, the breakdown of accrued expenses was as follows:
Reason for
outstanding
at the End
Item 30 June 2022 31 December 2021 of the Period
Utility bill 27,466,692.82 23,611,733.95 Unpaid
Research expenses 28,761,380.34 122,637,625.45 Unpaid
Business development and promotion expenses 1,413,316,758.37 1,459,695,485.76 Unpaid
Audit and information disclosure expenses 5,270,541.09 4,893,299.88 Unpaid
Others 71,446,032.73 85,434,073.50 Unpaid
Total 1,546,261,405.35 1,696,272,218.54
31. Non-current liabilities due within one year
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item End of the Period the Period
Lease liabilities due within one year 22,846,465.95 21,295,233.00
Long-term loans and interest due within one year 70,343,888.89 70,280,833.33
Total 93,190,354.84 91,576,066.33
lnterim Report 2022 183
32. Other current liabilities
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item End of the Period the Period
Output VAT pending for transfer 7,166,683.80 15,626,224.29
Total 7,166,683.80 15,626,224.29
Change of short-term bonds payable
□ Applicable √ N/A
Other descriptions:
□ Applicable √ N/A
33. Long-term loans
(1) Classification of long-term loans
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item End of the Period the Period
Unsecured loans 989,343,888.89 897,061,086.11
Guaranteed loans 1,484,726,004.58 0.00
Less: Long-term loans due within one year 70,343,888.89 70,280,833.33
Total 2,403,726,004.58 826,780,252.78
Other descriptions, including interest rate range:
√ Applicable □ N/A
The interest rate range of credit loan is 2.60% – 3.20%, and the interest rate range of guaranteed loan is 2.70% – 3.60%.
34. Lease liabilities
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item End of the Period the Period
Lease payments payable 45,445,648.55 46,367,027.32
Lease liabilities due within one year -22,846,465.95 -21,295,233.00
Total 22,599,182.60 25,071,794.32
Other descriptions:
Interest expenses accrued on lease liabilities during the 6-month period ended 30 June 2022 was RMB805,700, which was
recorded in financial expenses-Interest expense.
184 Joincare Pharmaceutical Group Industry Co., Ltd.
35. Deferred income
Deferred income
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the Balance at
Beginning of the End of Reason of
Item the Period Increase Decrease the Period formation
Government grants 433,543,352.40 80,953,200.00 42,136,416.15 472,360,136.25 /
Total 433,543,352.40 80,953,200.00 42,136,416.15 472,360,136.25 /
Projects involving government grants:
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Charged to
Non-operating Transfer
Beginning Additions income for to other Other Closing Related to assets/
Projects with grants balance in the period the period income movement balance Related to income
Research and development funds for new drug for Class I 8,000,000.00 0.00 0 5,924,000.00 2,076,000.00 0.00 Related to income
Treatment of Necrosis Factor in Human Tumour from Human
Source (I类治疗用人源化抗人肿瘤坏死因子α单克隆抗体新
药研制资金)
Innovation capacity building of technology center (antibody 166,439.46 0.00 0 37,665.18 0.00 128,774.28 Related to income
laboratory) (技术中心创新能力建设(抗体药物实验室))
Scientific technology award and subsidy for technological 2,200,000.00 0.00 0 0.00 0.00 2,200,000.00 Related to income
innovative project (科学技术奖及科技创新项目资助)
Zhuhai industrial enterprise “cloud and platform” service 89,431.86 0.00 0 12,770.43 0.00 76,661.43 Related to income
coupons supporting funds (珠海市工业企业“云上平台”服
务券支持资金)
China Postdoctoral Science Foundation subsidy funds (中国 80,000.00 0.00 0 0.00 0.00 80,000.00 Related to income
博士后科学基金会资助经费)
Structure-efficiency optimization of marine microorganisms 312,366.27 0.00 0 216,622.02 0.00 95,744.25 Related to income
and evaluation of antitumor activity (海洋微生物构效优化与
抗肿瘤活性评价)
Laboratory project of respiratory system inhalation 3,501,550.00 0.00 0 808,050.00 0.00 2,693,500.00 Related to assets
preparation engineering laboratory project (呼吸系统吸入制
剂工程实验室项目)
Construction of a recycling production base for carbapenem 3,625,000.00 0.00 0 0.00 0.00 3,625,000.00 Related to assets
products (碳青霉烯类系列产品循环化生产基地建设)
Construction of an integrated production line for fully 927,666.66 0.00 0 121,000.02 0.00 806,666.64 Related to assets
automatic blister-type dry powder inhalant micro-filling and
winding (全自动泡罩型干粉吸入剂微量灌封与卷绕一体化
生产线建设)
Change in National Science and Technology Major Project* 150,000.00 0.00 0 150,000.00 0.00 0.00 Related to assets
Research funding for lipid injection * Baiyunshan Hanfang
transfer (国家重大专项项目变更*注射脂质研究经费*白云
山汉方转入)
Research on common key technologies for the large-scale 365,700.00 0.00 0 0.00 0.00 365,700.00 Related to assets
development of new inhalation preparations (新型吸入制剂
规模化发展共性关键技术研究)
Large-scale development subsidy for new inhalation 2,262,600.00 0.00 0 0.00 0.00 2,262,600.00 Related to assets
preparations (新型吸入制剂规模化发展补助)
Project Subsidy of Marine mollusk kinetic protein (海洋软体 23,840,000.00 0.00 0 0.00 0.00 23,840,000.00 Related to assets
动物动能蛋白项目补助)
New inhalation drug formulation creation project (新型吸入 67,248,400.00 6,349,500.00 0 0.00 0.00 73,597,900.00 Related to assets
给药制剂创制项目)
Zhimu total sapogenin project (知母总皂甙元项目) 8,900,000.00 0.00 0 0.00 0.00 8,900,000.00 Related to assets
Glucocorticoid inhalation suspension project (糖皮质混悬液 3,600,000.00 4,000,000.00 0 0.00 0.00 7,600,000.00 Related to assets
项目)
lnterim Report 2022 185
Charged to
Non-operating Transfer
Beginning Additions income for to other Other Closing Related to assets/
Projects with grants balance in the period the period income movement balance Related to income
Financial appropriations for small molecule peptide projects 319,999.80 0.00 0 40,000.02 0.00 279,999.78 Related to assets
(收 Financial allocation 用于小分子肽项目)
Radix Rhapontici total sterone project (漏芦总甾酮项目) 2,500,000.00 0.00 0 0.00 0.00 2,500,000.00 Related to assets
R&D of active substances with bone and joint repair and 957,649.92 0.00 0 59,853.12 0.00 897,796.80 Related to assets
health care functions (具有骨关节修复与保健功能的活性物
质研发)
Key technology research and development of budesonide 2,508,333.33 0.00 0 175,000.02 0.00 2,333,333.31 Related to assets
nebulized inhalation solution (布地奈德雾化吸入溶液关键
技术研发)
Return of land holding tax (土地使用税返还) 3,567,661.42 0.00 0 703,111.26 0.00 2,864,550.16 Related to assets
Subsidies for the development of pharmaceutical APIs 40,741,354.94 0.00 0 0.00 0.00 40,741,354.94 Related to assets
industry (医药原料药行业发展支持资金补助)
Innovation Coupon (Jingjin Filter Press Equipment) (收创新券 233,332.79 0.00 0 0.00 0.00 233,332.79 Related to assets
(景津压滤设备))
Xinxiang High-tech Project Fund Support (新乡高新技术项目 1,861,111.08 0.00 0 28,198.68 0.00 1,832,912.40 Related to assets
资金扶持)
Research on Common Co-construction Technology of 2,800,000.00 0.00 0 0.00 0.00 2,800,000.00 Related to assets
Pharmaceutical Inhalation Preparations (开发区财政局拔款
创业领军人才项目:药品吸入制剂共性共建技术的研究)
Research and development of respiratory system drug and 1,500,000.00 0.00 0 0.00 0.00 1,500,000.00 Related to assets
clinical research technology service platform project talent
funding (呼吸系统药物研发和临床研究技术服务平台项目
人才经费)
Science and technology help the economy key special 500,000.00 0.00 0 0.00 0.00 500,000.00 Related to assets
projects (科技助力经济重点专项)
City Service Development Special project (市服务发展专项) 800,000.00 0.00 0 0.00 0.00 800,000.00 Related to assets
Patent funding (专利资助) 200,000.00 0.00 0 0.00 0.00 200,000.00 Related to assets
2020 Shanghai Professional Technology Platform Capacity 1,000,000.00 0.00 0 0.00 0.00 1,000,000.00 Related to assets
Enhancement Project (2020 年度上海市专业技术平台能力
提升项目立项)
High-growth small and micro innovation enterprises (高成长 400,000.00 0.00 0 0.00 0.00 400,000.00 Related to assets
小微科创企业)
Research and development subsidy for ω-3-Fish Oil Medium 350,000.00 0.00 0 350,000.00 0.00 0.00 Related to assets
and Long Chain Fat Emulsion Injection (ω-3 鱼油中/长链脂
肪乳注射液研究开发补助)
R&D and industrialization of innovative Ilaprazole Series (艾普 16,078,166.25 0.00 0 2,455,000.32 0.00 13,623,165.93 Related to assets
拉唑系列创新药物研发及产业化)
Fund for industrialization of prolonged-action microsphere 12,550,000.00 0.00 0 0.00 0.00 12,550,000.00 Related to assets
preparation (长效微球制剂的产业化款项)
Construction project for industrialization of prolonged-action 20,719,505.48 0.00 0 1,202,654.94 0.00 19,516,850.54 Related to assets
microsphere preparation (phase I) (长效微球制剂产业化建设
项目(一期工程))
Project subsidy from the Ministry of Industry and Information 2,400,000.00 0.00 0 0.00 0.00 2,400,000.00 Related to assets
Technology (工业和信息化部项目补助款)
Project subsidy from the Ministry of Industry and Information 1,366,750.00 0.00 0 115,500.00 0.00 1,251,250.00 Related to assets
Technology (工业和信息化部项目补助款)
Construction of Drug Conformity Evaluation Research Center 1,040,000.14 0.00 0 79,999.98 0.00 960,000.16 Related to assets
Platform (药物一致性评价研究中心平台建设)
R&D and Commercialisation of Mouse Nerve Growth Factor 40,045,946.93 0.00 0 5,280,044.64 0.00 34,765,902.29 Related to assets
for Injection (注射用鼠神经生长因子研发及产业化)
Demonstration project on the application of solar 2,455,499.43 0.00 0 551,000.04 0.00 1,904,499.39 Related to assets
photovoltaic architecture (太阳能光电建筑应用示范项目)
Subsidy for the Tender of Technology Upgrade Project for 2,703,484.56 0.00 0 204,182.88 0.00 2,499,301.68 Related to assets
PVC Soft Bag Supported by Provincial Finance Departments
(省财政支持技改招标项目补助金 PVC 软袋)
Technical transformation project of Shenqi Fuzheng Injection 15,676,470.62 0.00 0 1,911,764.70 0.00 13,764,705.92 Related to assets
with flexible bag (软袋(参芪扶正注射液)技改项目)
186 Joincare Pharmaceutical Group Industry Co., Ltd.
Charged to
Non-operating Transfer
Beginning Additions income for to other Other Closing Related to assets/
Projects with grants balance in the period the period income movement balance Related to income
Provision for technology transformation funds and 5,459,555.72 0.00 0 564,781.68 0.00 4,894,774.04 Related to assets
subsequent grants (技术改造资金拨款及事后补奖)
Provision for technology transformation funds and 7,359,670.81 0.00 0 891,684.24 0.00 6,467,986.57 Related to assets
subsequent grants (技术改造资金拨款及事后补奖)
Electricity distribution transformer performance enhancement 380,000.00 0.00 0 24,000.00 0.00 356,000.00 Related to assets
for energy-saving and emission reduction projects ((节能减排
项目))配电变压器能效提升)
R&D and industrialization team of chemical drug liquid 1,534,833.44 234,000.00 0 28,999.92 0.00 1,739,833.52 Related to assets
preparation (化药液体制剂研发与产业化团队)
Innovation capacity building of technology center (antibody 4,802,478.80 0.00 0 222,877.68 0.00 4,579,601.12 Related to assets
laboratory) (技术中心创新能力建设(抗体药物实验室))
Achievement transfer of blood screening (BCI) nucleic acid 3,961,282.44 0.00 0 0.00 0.00 3,961,282.44 Related to assets
detection testing (血液筛查(BCI)核酸检测试剂成果转化)
Technological upgrading and transformation projects of 464,285.80 0.00 0 53,571.42 0.00 410,714.38 Related to assets
workshop for acarbose (APIs for α-glucosidase inhibitor) (α-葡
萄糖苷酶抑制剂类原料药阿卡波糖生产车间工艺升级技术
改造项目)
R&D and industrialization of Statins (降血脂他汀类药物的研 30,000.48 0.00 0 14,999.94 0.00 15,000.54 Related to assets
发与产业化)
Scientific technology award and subsidy for technological 28,566.20 0.00 0 28,566.20 0.00 0.00 Related to assets
innovative project (科学技术奖及科技创新项目资助)
Commissioner workstation (特派员工作站) 85,000.00 0.00 0 30,000.00 0.00 55,000.00 Related to assets
Industrial revitalisation supporting funds (产业振兴扶持资金) 2,445,500.01 0.00 0 579,000.00 0.00 1,866,500.01 Related to assets
Phase IV clinical study of innovative drug Ilaprazole (创新药 8,210,800.00 0.00 0 8,210,800.00 0.00 0.00 Related to assets
物艾普拉唑 IV 期临床研究)
Government grant for industrial transformation (工业转型政 308,333.75 0.00 0 99,999.96 0.00 208,333.79 Related to assets
府扶持资金)
New industrialization development grant (新型工业化发展奖 3,584,066.38 0.00 0 175,000.02 0.00 3,409,066.36 Related to assets
金)
Policy fund for leading industrial enterprises loan Interests (工 366,666.57 0.00 0 100,000.02 0.00 266,666.55 Related to assets
业龙头企业贷款贴息政策资金)
Supporting funds for five advantageous industrial clusters 300,000.20 0.00 0 49,999.98 0.00 250,000.22 Related to assets
and one high-tech industry (五优一新扶持资金)
Capital project for innovation and entrepreneurship team 12,500,000.00 0.00 0 0.00 0.00 12,500,000.00 Related to assets
funding program (创新创业团队资助计划资金项目)
2020 Zhuhai City Innovation and Entrepreneurship Team 1,500,000.00 0.00 0 0.00 0.00 1,500,000.00 Related to assets
(Nanocrystalline) (2020 年度珠海市创新创业团队(纳米晶))
Fund for R&D and industrialization of innovative Ilaprazole 5,600,000.00 0.00 0 5,600,000.00 0.00 0.00 Related to assets
series (R&D and industrialization of innovative Ilaprazole
Series (艾普拉唑系列创新药物研发及产业化))项目资金)
Key projects of industrial core and key technologies of Zhuhai 3,000,000.00 0.00 0 0.00 0.00 3,000,000.00 Related to assets
(Ryanodex) (珠海市产业核心和关键技术攻关方向项目(丹曲
林钠))
Data-driven industrial chain collaboration platform 3,650,000.00 0.00 0 365,000.00 0.00 3,285,000.00 Related to assets
demonstration project (数据驱动的产业链协同平台示范项
目)
Fund for key projects of industrial core and key technologies 2,000,000.00 0.00 0 0.00 0.00 2,000,000.00 Related to assets
of Zhuhai (2nd batch) (珠海市产业核心和关键技术攻关方向
项目资金(第二批))
Innovative drug of Ilaprazole sodium for injection (创新药注 2,400,000.00 0.00 0 0.00 0.00 2,400,000.00 Related to assets
射用艾普拉唑钠针剂)
Technological transformation projects of new Cefuroxime (新 1,533,100.00 0.00 0 0.00 0.00 1,533,100.00 Related to assets
型头孢粉针剂技术改造项目)
Advanced Pharmaceutical Manufacturing Internet 675,000.00 0.00 0 45,000.00 0.00 630,000.00 Related to assets
Benchmarking Project (先进药品制造互联网标杆项目)
Cleaner Production Audit Project (清洁生产审核项目) 180,000.08 0.00 0 4,999.98 0.00 175,000.10 Related to assets
Green factory (绿色工厂) 1,131,666.71 0.00 0 64,999.98 0.00 1,066,666.73 Related to assets
HCG project construction (HCG 项目建设) 3,387,835.84 0.00 0 197,824.98 0.00 3,190,010.86 Related to assets
lnterim Report 2022 187
Charged to
Non-operating Transfer
Beginning Additions income for to other Other Closing Related to assets/
Projects with grants balance in the period the period income movement balance Related to income
Sewage treatment system upgrade project (污水处理系统升 64,239.92 0.00 0 4,015.02 0.00 60,224.90 Related to assets
级改造项目)
R&D and industrialization of Recombinant Human Chorionic 1,137,500.00 0.00 0 75,000.00 0.00 1,062,500.00 Related to assets
Gonadotropin for Injection (注射用重组人绒促性素研发及
产业化)
Subsidies for online monitoring equipment and installations 82,500.00 0.00 0 11,250.00 0.00 71,250.00 Related to assets
of coalfired boilers (燃煤锅炉在线监控设备装置补助)资金)
Funds for joint R&D and industrialization of integrated 181,632.12 0.00 0 0.00 0.00 181,632.12 Related to assets
platform for molecular diagnostics (集成一体化分子诊断平
台的合作研发及产业化)资金)
Project supporting fund for the first batch of special funds for 600,000.00 0.00 0 0.00 0.00 600,000.00 Related to assets
scientific and technological innovation in 2019 (2019 年度第
一批科技创新专项资金立项配套资助)
Provincial industrial innovation (provincial enterprise 1,046,533.33 0.00 0 0.00 0.00 1,046,533.33 Related to assets
technology center) project in 2019 (2019 年度省产业创新(省
级企业技术中心)项目)
Pre-appropriation of special grants for industrialization of 4,116,415.65 0.00 0 0.00 0.00 4,116,415.65 Related to assets
diagnostic reagents for COVID-19 (新型冠状病毒检测试剂产
业化项目补助金预拨)
Xiangzhou District equipment purchase subsidy supporting 11,467.25 0.00 0 0.00 0.00 11,467.25 Related to assets
funds ((香洲区采购设备补贴扶持资金(疫情防控专项资金)
Zhuhai innovation and enterprising team and high-level 12,000,000.00 0.00 0 0.00 0.00 12,000,000.00 Related to assets
talent enterprising project Phase I funds (珠海市创新创业团
队和高层次人才创业项目首期资金)
Development and Industrialization of Cyclosporine Self- 0.00 240,000.00 0 2,000.00 0.00 238,000.00 Related to assets
Emulsifying Soft Capsule Formulation with High Technology
(高技术屏障的环孢素自乳化软胶囊制剂的开发及产业化研
究)
Guangdong Provincial Key Laboratory of Characteristic Drug 0.00 1,000,000.00 0 8,333.33 0.00 991,666.67 Related to assets
Research and Development Enterprises (广东省特色药物研
发企业重点实验室)
Overall relocation and deployment expansion project (整体 20,000,000.00 30,000,000.00 0 0.00 0.00 50,000,000.00 Related to assets
搬迁调迁扩建项目)
2022 Special funds for the reconstruction of the industrial 0.00 32,740,000.00 0 0.00 0.00 32,740,000.00 Related to assets
base of the central government and the high-quality
development of the manufacturing industry (2022 年中央财
政产业基础再造和制造业高质量发展专项资金)
Subsidy Fund LZM009 for National Science and Technology 0.00 4,744,900.00 0 2,171,293.53 0.00 2,573,606.47 Related to assets
Major Special Projects (国家科技重大专项项目后补助资金
LZM009)
Xiangzhou District actively responds to the impact of the 0.00 1,644,800.00 0 0.00 0.00 1,644,800.00 Related to assets
epidemic and stabilizes the innovation-driven technology
industry sub-item (香洲区积极应对和疫情影响保稳创新驱
动科技工业分项)
Environmental protection bureau RTO project special funds 179,999.96 0.00 0 10,000.02 0.00 169,999.94 Related to assets
(环保局 RTO 项目资金)
Strategic emerging industries in 2014 (sustained release 16,700,000.00 0.00 0 0.00 0.00 16,700,000.00 Related to assets
microspheres) (2014 年战略性新兴产业(缓释微球))
Total 433,543,352.40 80,953,200.00 0 40,060,416.15 2,076,000.00 472,360,136.25
Other descriptions:
□ Applicable √ N/A
188 Joincare Pharmaceutical Group Industry Co., Ltd.
36. Other non-current liabilities
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at
Balance at the the Beginning of
Item End of the Period the Period
The overall relocation and expansion project of Sichuan Guangda 84,000,000.00 78,000,000.00
Pharmaceutical Manufacturing
Total 84,000,000.00 78,000,000.00
37. Share capital
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the Changes for the Period (+ -) Balance at
Beginning of Issuance of Conversion from the End of
the Period new shares capital reserve Others Subtotal the Period
I. Tradable shares subject to selling
restrictions
1. Domestic legal person shares 0 0 0 0 0 0
2. Domestic natural person shares 0 0 0 0 0 0
3. Overseas legal person shares 0 0 0 0 0 0
Tradable shares subject to selling 0 0 0 0 0 0
restrictions in aggregate
II. Tradable shares
1. Ordinary shares denominated in RMB 1,907,727,908 4,812,759 0 0 4,812,759 1,912,540,667
2. Domestically listed foreign shares 0 0 0 0 0 0
Tradable shares in aggregate 1,907,727,908 4,812,759 0 0 4,812,759 1,912,540,667
III. Total number of shares 1,907,727,908 4,812,759 0 0 4,812,759 1,912,540,667
Other descriptions:
The increase in share capital in this period was due to the exercise of stock options.
38. Capital reserve
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Beginning of Balance at the
Item the Period Increase Decrease End of the Period
Capital premium (Share premium) 2,152,860,227.84 44,936,885.69 0.00 2,197,797,113.53
Other capital reserve 112,497,084.08 9,042,659.92 2,976,058.58 118,563,685.42
Total 2,265,357,311.92 53,979,545.61 2,976,058.58 2,316,360,798.95
Other descriptions, including changes for the current period and reasons therefor:
lnterim Report 2022 189
Reasons for increase in capital premium: 1) 4,812,759 shares of the Company’s stock options were exercised, increasing the
capital premium by RMB34,163,528.26; 2) The Company’s subsidiary Livzon’s stock options are exercised, according to the
shareholding ratio of the Company, the corresponding increase in the share capital premium of RMB7,130,961.18; 3) After
the stock options are exercised,the difference between the pre-taxable expenses and the accrued expenses will reduce the
income tax payable by RMB3,642,396.25, and the share capital premium will be increased accordingly;
Reasons for increase in Other capital reserves: The equity incentive fee accrued by the Livzon Group and its subsidiaries
was RMB9,042,659.92.
Reasons for decrease in Other capital reserves: The exercise of the stock options of the incentive plan and repurchase of
the subsidiary Livzon Group lead to changes in the Company’s shareholding ratio and changes in other equity instrument
investment; thus the capital reserve decreased by RMB2,976,058.58.
39. Treasury shares
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the Balance at
Beginning of the End of
Item the Period Increase Decrease the Period
Repurchase of shares due to Share 222,644,454.50 0.00 0.00 222,644,454.50
Ownership Scheme and Share
Options Incentive Scheme
Repurchase of shares to be cancelled 0.00 520,332,751.22 0.00 520,332,751.22
Total 222,644,454.50 520,332,751.22 0.00 742,977,205.72
Other descriptions, including changes for the current period and reasons therefor:
The reason for decreases in the ending balances of Repurchase of A Shares due to Share Ownership Scheme and the
Company repurchased 44,696,643 shares totally through centralized bidding transactions by the Company.
40. Other comprehensive income
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the Period
Less:
transferred to
profit or loss Amount
in current Amount attributable to
Balance at the period attributable to minority Balance at the
Beginning of Amount or retained Less: Income parent company interests End of the
Item The Period before tax earnings tax expenses after tax after tax Period
I. Other comprehensive income not 102,556,982.18 9,039,908.20 86,177,636.78 3,693,873.01 -79,078,918.80 -1,752,682.78 23,478,063.37
reclassified into profit or loss subsequently
1. Other comprehensive income not 6,658,847.65 2,476,997.86 0.00 0.00 1,109,969.99 1,367,027.87 7,768,817.64
reclassified to profit or loss under equity
method
2. Changes in fair value of other equity 95,898,134.53 6,562,910.34 86,177,636.78 3,693,873.01 -80,188,888.79 -3,119,710.65 15,709,245.73
instrument investments
190 Joincare Pharmaceutical Group Industry Co., Ltd.
For the Period
Less:
transferred to
profit or loss Amount
in current Amount attributable to
Balance at the period attributable to minority Balance at the
Beginning of Amount or retained Less: Income parent company interests End of the
Item The Period before tax earnings tax expenses after tax after tax Period
II. Other comprehensive income that -97,169,436.20 55,768,464.08 0.00 0.00 36,080,061.60 19,688,402.47 -61,089,374.60
will be reclassified into profit or loss
subsequently
Including: Other comprehensive income 37,989.91 0.00 0.00 0.00 0.00 0.00 37,989.91
that will be transferred to profit or loss
under equity method
Translation difference of foreign currency -97,207,426.12 55,768,464.080 0.000 0.000 36,080,061.60 19,688,402.47 -61,127,364.52
financial statements
Total of other comprehensive income 5,387,545.97 64,808,372.28 86,177,636.78 3,693,873.01 -42,998,857.20 17,935,719.69 -37,611,311.23
41. Surplus reserve
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the Balance at the
Beginning of End of the
Item the Period Increase Decrease Period
Statutory surplus reserve 599,506,581.71 8,617,763.68 0.00 608,124,345.39
Discretionary surplus reserve 40,210,642.44 0.00 0.00 40,210,642.44
Reserve funds 1,103,954.93 0.00 0.00 1,103,954.93
Total 640,821,179.08 8,617,763.68 0.00 649,438,942.76
42. Undistributed profits
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the
Item For the Period Previous Period
Retained earnings in previous period before adjustments 7,223,644,166.22 6,231,451,582.26
Adjustments to opening balance of retained earnings (increase +, decrease -) 0.00 0.00
Opening balance of retained earnings after adjustments 7,223,644,166.22 6,231,451,582.26
Add: Net profit attributable to parent company for the current period 801,268,519.50 687,347,494.53
Gains from disposal of other equity instruments investment 86,177,636.78 77,041,425.92
Less: Appropriation of statutory surplus reserve 8,617,763.68 0.00
Appropriation of discretionary surplus reserve 0.00 0.00
Appropriation for dividends to ordinary shares 277,557,631.65 288,675,388.05
Dividend converted to share capital of ordinary shares 0.00 0.00
Closing balance of undistributed profits 7,824,914,927.17 6,707,165,114.66
lnterim Report 2022 191
43. Operating income and operating cost
(1) The information of operating income and operating cost
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the Period For the Previous Period
Item Income Cost Income Cost
Primary operations 8,492,047,759.72 3,002,949,330.38 7,783,517,167.36 2,702,753,651.01
Other operations 72,897,525.83 51,443,372.82 51,855,107.30 40,252,083.92
Total 8,564,945,285.55 3,054,392,703.20 7,835,372,274.66 2,743,005,734.93
Other descriptions:
(2) Breakdown information of principal activities income
① Segregation by products
For the Period For the Previous Period
Item Income Cost Income Cost
Chemical pharmaceuticals 4,799,253,426.28 925,086,073.19 4,434,234,171.70 840,614,882.95
Chemical APIs and Intermediates 2,771,577,889.05 1,743,742,075.65 2,258,879,617.33 1,517,873,006.34
Traditional Chinese medicine 514,402,423.73 146,937,126.69 633,012,054.83 168,867,289.58
Diagnostic reagents and equipment 346,042,443.87 164,056,563.15 390,683,579.78 156,931,989.53
Health care products 54,741,880.51 20,894,995.01 62,421,585.01 17,301,631.46
Industry and Commerce Subtotal 8,486,018,063.45 3,000,716,833.69 7,779,231,008.65 2,701,588,799.86
Service industry 6,029,696.27 2,232,496.69 4,286,158.71 1,164,851.15
Total 8,492,047,759.72 3,002,949,330.38 7,783,517,167.36 2,702,753,651.01
② Segregation by operating location
For the Period For the Previous Period
Item Income Cost Income Cost
Domestic 6,974,358,565.54 2,065,054,349.09 6,520,552,394.49 1,840,235,327.71
Overseas 1,517,689,194.18 937,894,981.29 1,262,964,772.87 862,518,323.30
Total 8,492,047,759.72 3,002,949,330.38 7,783,517,167.36 2,702,753,651.01
③ Segregation by timing of revenue recognition
For the Period For the Previous Period
Item Income Cost Income Cost
Commodities (recognised at a point 8,492,047,759.72 3,002,949,330.38 7,783,517,167.36 2,702,753,651.01
of time)
Total 8,492,047,759.72 3,002,949,330.38 7,783,517,167.36 2,702,753,651.01
④ Information of top five customers of business revenue
Total operating income Proportion to primary operating
Period of the top five customers income in the period
(%)
January to June 2022 784,737,990.71 9.24
January to June 2021 630,159,477.01 8.10
192 Joincare Pharmaceutical Group Industry Co., Ltd.
⑤ Segregation by other operations
For the Period For the Previous Period
Item Income Cost Income Cost
Sales of raw materials 32,752,345.84 20,358,443.93 12,758,350.56 11,496,878.44
Processing fee 1,336,854.96 546,940.37 1,140,976.90 396,907.15
Rental fees 5,928,780.42 930,025.57 5,089,008.66 89,288.66
Power fee 6,434,386.87 6,293,501.06 6,555,922.19 6,473,672.50
Others 26,445,157.74 23,314,461.89 26,310,848.99 21,795,337.17
Total 72,897,525.83 51,443,372.82 51,855,107.30 40,252,083.92
44. Taxes and surcharges
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the
Item For the Period Previous Period
Urban construction tax 40,929,152.73 37,829,206.02
Education surcharge 30,058,369.58 28,856,430.50
Property tax 11,993,989.59 11,683,354.15
Land use tax 5,195,628.85 5,029,764.24
Stamp duty and others 6,145,497.56 6,946,337.65
Total 94,322,638.31 90,345,092.56
Other descriptions:
The bases of calculations for major taxes and surcharges are set out in Note IV. Taxation.
45. Selling expenses
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the
Item For the Period Previous Period
Marketing and promotional expenses 2,183,934,600.06 2,221,503,601.12
Staff salaries 260,162,330.69 203,807,784.32
Entertainment and travel expenses 20,988,461.23 27,758,220.54
Conference fees 8,609,021.92 6,762,806.37
Others 38,675,378.55 40,117,344.95
Total 2,512,369,792.45 2,499,949,757.30
lnterim Report 2022 193
46. Administrative expenses
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the
Item For the Period Previous Period
Staff salaries 276,280,216.68 163,036,323.73
Depreciation and amortization 52,062,021.03 55,667,766.18
Loss on suspension of operations 83,168,875.94 31,970,734.79
Shares incentive expenses 10,488,471.09 13,424,119.37
Advisory, consultancy and information disclosure fees 12,483,135.10 14,019,770.61
Quality project expenses 11,250,121.78 17,217,491.18
Office, entertainment and travelling expenses 22,601,820.05 27,835,340.08
Repair of utilities, transportation and miscellaneous expenses 16,250,836.91 19,422,163.38
Recruitment and staff training expenses 2,548,844.21 4,669,835.42
Others 42,693,969.14 50,657,546.43
Total 529,828,311.93 397,921,091.17
47. R&D expenses
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the
Item For the Period Previous Period
Material fee 146,857,218.55 144,814,730.87
Staff salaries 207,091,826.90 187,188,506.60
Shares incentive expenses 9,799,989.00 175,632.62
Testing fee 205,299,479.02 182,107,386.82
Depreciation and amortization 67,800,559.34 55,398,138.72
Others 70,584,005.63 53,277,992.78
Total 707,433,078.44 622,962,388.41
48. Finance expenses
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the
Item For the Period Previous Period
Interest expenses 60,979,386.68 38,708,820.91
Interest income -117,501,999.50 -78,035,350.84
Exchange gains and losses -77,672,355.34 -6,123,814.35
Bank charges and others 3,793,920.49 3,723,581.51
Total -130,401,047.67 -41,726,762.77
194 Joincare Pharmaceutical Group Industry Co., Ltd.
49. Other income
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the Related to assets/
Item For the Period Previous Period Related to income
Government grants 33,869,358.52 24,627,144.39 Related to assets
Government grants 60,315,844.07 104,833,852.88 Related to income
Handling fees for tax withholding 3,025,074.11 1,994,381.60
Tax refund on super-deduction 31,977.33 0.00
Total 97,242,254.03 131,455,378.87
Other descriptions:
For specific information on government grants, please refer to Note V. 62. Government grants for details.
50. Investment income
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the
Item For the Period Previous Period
Investment income from financial assets held for trading during the holding 306,527.56 75,810.76
period
Investment income from disposal of financial assets held for trading -3,456,991.56 22,232,401.40
Dividend income from other equity instrument investments 8,713,730.74 12,328,961.74
Long-term equity investments income under equity method 41,208,487.80 9,750,424.27
Investment income from disposal of long-term equity investments 4,242,404.46 2,423,029.20
Total 51,014,159.00 46,810,627.37
51. Gains from changes in fair value
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the
Sources of gains from changes in fair value For the Period Previous Period
Financial assets held for trading -89,596,630.72 33,851,438.22
Including: Debt instruments investment 13,515.95 17,055.84
Equity instruments investment -80,056,904.18 43,142,356.83
Derivative financial assets -9,553,242.49 -9,307,974.45
Financial liabilities held for trading -5,882,906.43 -534,891.07
Including: Derivative financial liabilities -5,882,906.43 -534,891.07
Total -95,479,537.15 33,316,547.15
lnterim Report 2022 195
52. Credit impairment loss
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the
Item For the Period Previous Period
Bad debts of notes receivable 0.00 0.00
Bad debts of accounts receivable -933,002.92 -8,839,388.74
Bad debts of other receivables -1,872,437.91 -645,906.93
Total -2,805,440.83 -9,485,295.67
53. Asset impairment losses
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the
Item For the Period Previous Period
I. Losses on bad debts 0.00 0.00
II. Losses on decline in value of inventories and on impairment of contract -27,834,495.93 -28,787,578.96
performance costs
III. Losses on impairment of long-term equity investments 0.00 0.00
IV. Losses on impairment of property 0.00 0.00
V. Losses on impairment of fixed assets 0.00 -90,481.03
VI. Losses on impairment of project materials 0.00 0.00
VII. Losses on impairment of construction in progress 0.00 0.00
VIII. Losses on impairment of bearer biological assets 0.00 0.00
IX. Losses on impairment on oil and gas assets 0.00 0.00
X. Losses on impairment of intangible assets 0.00 0.00
XI. Losses on impairment of goodwill 0.00 0.00
XII. Others 0.00 0.00
Total -27,834,495.93 -28,878,059.99
54. Gains on disposal of assets
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the
Item For the Period Previous Period
Gain from disposal of fixed assets (“-” for Loss) -510,518.91 664,575.34
Gain from disposal of intangible assets (“-” for Loss) 0.00 17,263,196.60
Total -510,518.91 17,927,771.94
196 Joincare Pharmaceutical Group Industry Co., Ltd.
55. Non-operating income
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Amount included
For the in non-recurring
Item For the Period Previous Period gains and losses
Gain from retirement of non-current assets 774,200.18 662,808.97 774,200.18
Including: Gain from disposal of fixed assets 774,200.18 662,808.97 774,200.18
Income from scraps 1,368,658.80 1,887,207.65 1,368,658.80
Waiver of payables 651,801.74 390,917.12 651,801.74
Compensation income 122,240.53 52,270.26 122,240.53
Others 1,554,013.63 1,648,160.71 1,554,013.63
Total 4,470,914.88 4,641,364.71 4,470,914.88
Government grants included in current profit or loss
□ Applicable √ N/A
56. Non-operating expenses
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Amount included
For the in non-recurring
Item For the Period Previous Period gains and losses
Loss on retirement of non-current assets 2,249,701.49 2,965,842.31 2,249,701.49
Including: Loss from disposal of fixed assets 2,249,701.49 2,965,842.31 2,249,701.49
Donation expenses 3,675,341.69 2,336,297.53 3,675,341.69
Others 816,563.67 737,831.60 816,563.67
Total 6,741,606.85 6,039,971.44 6,741,606.85
57. Income tax expenses
(1) Table of income tax expenses
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the
Item For the Period Previous Period
Current income tax 357,374,828.74 210,262,491.71
Deferred income tax -86,199,499.19 34,303,242.59
Total 271,175,329.55 244,565,734.30
lnterim Report 2022 197
(2) Reconciliation between income tax expenses and accounting profits
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Item For the Period
Profit before tax 1,816,355,537.13
Income tax expenses calculated at statutory (or applicable) tax rates 454,088,884.28
Impact from tax preferential rate in certain subsidiaries 7,080,084.10
Effect of tax reduction and exemption -265,360,638.45
Effect of non-deductible costs, expenses and losses 2,596,350.93
Effect of deductible tax losses for which no deferred tax assets were recognised in prior periods -661,040.08
Effect of deductible tax losses or deductible temporary differences for which no deferred tax asset 76,086,577.35
was recognised in the current period
Others -2,654,888.58
Income tax expenses 271,175,329.55
Other descriptions:
□ Applicable √ N/A
58. Notes to cash flows statement
(1) Other cash received relating to operating activities
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the
Item For the Period Previous Period
Government grants 135,472,208.17 142,823,778.95
Interest income 99,798,243.58 77,872,010.67
Security deposits 18,200,506.40 26,683,882.26
Current accounts and others 66,595,926.72 36,792,767.22
Total 320,066,884.87 284,172,439.10
(2) Other cash paid relating to operating activities
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the
Item For the Period Previous Period
Business promotion expenses 2,410,016,519.70 2,370,624,490.78
Research and development expenses 314,240,104.94 388,887,165.89
Bank charges 3,538,284.90 3,723,581.51
Letter of credit and bank acceptance bill deposit, etc. 1,164,843.92 13,196,993.75
Current accounts and others 10,960,309.52 28,848,576.74
Other expenses paid 279,038,419.08 345,181,558.78
Total 3,018,958,482.06 3,150,462,367.45
198 Joincare Pharmaceutical Group Industry Co., Ltd.
(3) Other cash received relating to investing activities
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the
Item For the Period Previous Period
Tiantong Securities bankruptcy distribution 158,470.77 0.00
Security deposits 6,825,715.78 13,359,977.34
Compensation for demolition 6,000,000.00 0.00
Others 0.00 1,600.00
Total 12,984,186.55 13,361,577.34
(4) Other cash paid relating to investing activities
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the
Item For the Period Previous Period
Security deposits 5,303,620.21 165,000.00
Foreign exchange forward contract losses 10,091,161.61 1,397,587.39
Others 150.00 3,658.70
Total 15,394,931.82 1,566,246.09
(5) Other cash received relating to financing activities
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the
Item For the Period Previous Period
Collection and advance payment of individual income tax 3,124,846.38 2,809,612.35
Total 3,124,846.38 2,809,612.35
(6) Other cash paid relating to financing activities
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the
Item For the Period Previous Period
Repurchase of shares 520,433,907.64 396,161,155.31
Capital reduction in minority interests in subsidiary 0.00 324,225,000.00
Rent 16,902,285.66 0.00
Collection and advance payment of individual income tax 1,237,210.80 2,531,100.50
Total 538,573,404.10 722,917,255.81
lnterim Report 2022 199
59. Supplemental to cash flow statement
(1) Supplemental to cash flow statement
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the
Supplemental information For the Period Previous Period
1. Reconciliation of net profit to cash flow from operating activities:
Net profit 1,545,180,207.58 1,468,097,601.70
Add: Assets impairment loss 27,834,495.93 28,878,059.99
Credit impairment loss 2,805,440.83 9,485,295.67
Depreciation of fixed assets 297,357,229.58 270,738,090.75
Amortization of right-of-use assets 16,158,894.05 0.00
Amortization of intangible assets 29,104,955.65 26,718,305.93
Long-term prepaid expenses amortization 24,818,590.37 21,713,671.84
Losses on disposal of fixed assets, intangible assets and other long-term 510,518.91 -17,927,771.94
assets (Gain as in “-”)
Loss on retirement of fixed assets (Gain as in “-”) 1,475,501.31 2,303,033.34
Losses on changes in fair value (Gain as in “-”) 95,479,537.15 -33,316,547.15
Financial expenses (Gain as in “-”) 4,262,214.38 43,511,052.15
Investment losses (Gain as in “-”) -51,014,159.00 -46,810,627.37
Decrease in deferred tax assets (Increase as in “-”) -84,323,187.15 19,964,526.43
Increase in deferred tax liabilities (Decrease as in “-”) -1,876,312.04 5,245,308.28
Decrease in inventories (Increase as in “-”) -201,059,238.14 -73,016,408.46
Decrease in operating receivables (Increase as in “-”) 559,085,768.30 -1,194,193,008.38
Increase in operating payables (Decrease as in “-”) -393,594,247.88 209,621,503.66
Others 30,747,014.96 4,775,426.92
Net cash flows from operating activities 1,902,953,224.79 745,787,513.36
2. Significant investment or finance activities not involving cash:
Conversion of debt into capital 0.00 0.00
Convertible bonds mature within one year 0.00 0.00
Fixed assets acquired under finance leases 0.00 0.00
3. Net increase/(decrease) in cash and cash equivalents:
Cash and bank balance as at end of period 12,615,780,742.32 10,192,939,435.47
Less: cash and bank balance at beginning of period 11,697,518,141.18 12,122,781,311.49
Add: cash equivalents at end of period 0.00 0.00
Less: cash equivalents at beginning of period 0.00 0.00
Net increase in cash and cash equivalents 918,262,601.14 -1,929,841,876.02
200 Joincare Pharmaceutical Group Industry Co., Ltd.
(2) Net cash paid for acquisition of subsidiaries during the period
□ Applicable √ N/A
(3). Net cash received from disposal of subsidiaries during the period
□ Applicable √ N/A
(4). Details of cash and cash equivalents
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item End of the Period the Period
I. Cash 12,615,780,742.32 11,697,518,141.18
Including: Cash on hand 190,985.30 225,179.98
Cash at bank readily available for payment 12,498,359,889.55 11,554,754,721.43
Other monetary fund readily available for payment 117,229,867.47 142,538,239.77
II. Cash equivalents 0.00 0.00
Including: bonds investment mature within 3 months 0.00 0.00
III. Cash and cash equivalents as at closing balance 12,615,780,742.32 11,697,518,141.18
Other descriptions:
√ Applicable □ N/A
Cash and cash equivalents do not include any cash and cash equivalents that are restricted in use.
60. Ownership or using rights of assets subject to restriction
√ Applicable □ N/A
Carrying value at
Item period end Reason of restriction
Other monetary funds 1,151,193.00 Security deposits of letters of credit, bank
acceptance bills and forward settlement
Notes receivable 526,815,981.78 Bills pool business, pledge notes receivable
Total 527,967,174.78 /
lnterim Report 2022 201
61. Items in foreign currencies
(1). Items in foreign currencies
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance in foreign Equivalent RMB balance
Item currency at year end Conversion rate at year end
Cash and bank balances
Including: HKD 769,925,909.50 0.85519 658,432,938.55
Euro 77,484.74 7.0084 543,044.05
USD 206,543,479.61 6.7114 1,386,195,909.06
MOP 5,036,397.92 0.8295 4,177,692.07
JPY 97,062,652.00 0.049136 4,769,270.47
GBP 1,940.10 8.1365 15,785.63
Accounts receivable – –
Including: USD 93,908,294.24 6.7114 630,256,125.96
Euro 207,750.00 7.00840 1,455,995.10
MOP 1,272,858.45 0.8295 1,055,836.08
Other receivables – –
Including: USD 23,247.31 6.7114 156,022.00
HKD 3,318,534.67 0.85519 2,837,977.66
MOP 581,188.00 0.8295 482,095.45
Accounts payable – –
Including: USD 408,078.53 6.7114 2,738,778.25
Euro 5,665.41 7.0084 39,705.46
JPY 123,464,265.53 0.049136 6,066,540.15
Other payables – –
Including: HKD 1,387,073.22 0.85519 1,186,211.15
USD 4,551,101.16 6.7114 30,544,260.33
(2). Descriptions of overseas operating entities, including disclosure of the main overseas
Business locations, functional currency and the basis for selection of important overseas operating entities, and the reasons
for changes in functional currency (if any)
□ Applicable √ N/A
62. Government grants
(1) Basic information of government grants
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Amount included
in profit or loss for
Category Amount Line item the current period
Related to assets 33,869,358.52 Other income 33,869,358.52
Related to income 60,315,844.07 Other income 60,315,844.07
202 Joincare Pharmaceutical Group Industry Co., Ltd.
(2) Return of government grants
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Items Amount Reasons
Research and development funds for new drug for Class I Treatment 2,076,000.00 Remaining funds returned
of humanized anti-TNF – α monoclonal antibody (I类治疗用人源化 in project settlement
抗人肿瘤坏死因子α单克隆抗体新药研制资金)
Other descriptions
(1). Government grants recorded as deferred income and measured at gross amount method subsequently
Item presented Related to
Beginning Additions in Transfer to Other Closing in income assets/Related to
Projects with grants Category balance the period profit or loss movement balance statement income
Research and development funds for new drug for Class I Financial allocation 8,000,000.00 0.00 5,924,000.00 2,076,000.00 0.00 Other income Related to
Treatment of Necrosis Factor in Human Tumour from Human income
Source (I 类治疗用人源化抗人肿瘤坏死因子 α 单克隆抗体新药
研制资金)
Innovation capacity building of technology center (antibody Financial allocation 166,439.46 0.00 37,665.18 0.00 128,774.28 Other income Related to
laboratory) (技术中心创新能力建设(抗体药物实验室)) income
Scientific technology award and subsidy for technological Financial allocation 2,200,000.00 0.00 0.00 0.00 2,200,000.00 Other income Related to
innovative project (科学技术奖及科技创新项目资助) income
Zhuhai industrial enterprise “cloud and platform” service coupons Financial allocation 89,431.86 0.00 12,770.43 0.00 76,661.43 Other income Related to
supporting funds (珠海市工业企业“云上平台”服务券支持资 income
金)
China Postdoctoral Science Foundation subsidy funds (中国博士 Financial allocation 80,000.00 0.00 0.00 0.00 80,000.00 Other income Related to
后科学基金会资助经费) income
Structure-efficiency optimization of marine microorganisms and Financial allocation 312,366.27 0.00 216,622.02 0.00 95,744.25 Other income Related to
evaluation of antitumor activity (海洋微生物构效优化与抗肿瘤 income
活性评价)
Laboratory project of respiratory system inhalation preparation Financial allocation 3,501,550.00 0.00 808,050.00 0.00 2,693,500.00 Other income Related to assets
engineering laboratory project (呼吸系统吸入制剂工程实验室
项目)
Construction of a recycling production base for carbapenem Financial allocation 3,625,000.00 0.00 0.00 0.00 3,625,000.00 Other income Related to assets
products (碳青霉烯类系列产品循环化生产基地建设)
Construction of an integrated production line for fully automatic Financial allocation 927,666.66 0.00 121,000.02 0.00 806,666.64 Other income Related to assets
blister-type dry powder inhalant micro-filling and winding (全自
动泡罩型干粉吸入剂微量灌封与卷绕一体化生产线建设)
Change in National Science and Technology Major Project* Financial allocation 150,000.00 0.00 150,000.00 0.00 0.00 Other income Related to assets
Research funding for lipid injection * Baiyunshan Hanfang
transfer (国家重大专项项目变更*注射脂质研究经费*白云山汉
方转入)
Research on common key technologies for the large-scale Financial allocation 365,700.00 0.00 0.00 0.00 365,700.00 Other income Related to assets
development of new inhalation preparations (新型吸入制剂规
模化发展共性关键技术研究)
Large-scale development subsidy for new inhalation preparations Financial allocation 2,262,600.00 0.00 0.00 0.00 2,262,600.00 Other income Related to assets
(新型吸入制剂规模化发展补助)
Project Subsidy of Marine mollusk kinetic protein (海洋软体动物 Financial allocation 23,840,000.00 0.00 0.00 0.00 23,840,000.00 Other income Related to assets
动能蛋白项目补助)
New inhalation drug formulation creation project (新型吸入给药 Financial allocation 67,248,400.00 6,349,500.00 0.00 0.00 73,597,900.00 Other income Related to assets
制剂创制项目)
Zhimu total sapogenin project (知母总皂甙元项目) Financial allocation 8,900,000.00 0.00 0.00 0.00 8,900,000.00 Other income Related to assets
Glucocorticoid inhalation suspension project (糖皮质混悬液项 Financial allocation 3,600,000.00 4,000,000.00 0.00 0.00 7,600,000.00 Other income Related to assets
目)
Financial appropriations for small molecule peptide projects (收 Financial allocation 319,999.80 0.00 40,000.02 0.00 279,999.78 Other income Related to assets
Financial allocation 用于小分子肽项目)
Radix Rhapontici total sterone project (漏芦总甾酮项目) Financial allocation 2,500,000.00 0.00 0.00 0.00 2,500,000.00 Other income Related to assets
lnterim Report 2022 203
Item presented Related to
Beginning Additions in Transfer to Other Closing in income assets/Related to
Projects with grants Category balance the period profit or loss movement balance statement income
R&D of active substances with bone and joint repair and health Financial allocation 957,649.92 0.00 59,853.12 0.00 897,796.80 Other income Related to assets
care functions (具有骨关节修复与保健功能的活性物质研发)
Key technology research and development of budesonide Financial allocation 2,508,333.33 0.00 175,000.02 0.00 2,333,333.31 Other income Related to assets
nebulized inhalation solution (布地奈德雾化吸入溶液关键技术
研发)
Return of land holding tax (土地使用税返还) Financial allocation 3,567,661.42 0.00 703,111.26 0.00 2,864,550.16 Other income Related to assets
Subsidies for the development of pharmaceutical APIs industry Financial allocation 40,741,354.94 0.00 0.00 0.00 40,741,354.94 Other income Related to assets
(医药原料药行业发展支持资金补助)
Receiving Innovation Coupon (Jingjin Filter Press Equipment) (收 Financial allocation 233,332.79 0.00 0.00 0.00 233,332.79 Other income Related to assets
创新券(景津压滤设备))
Xinxiang High-tech Project Fund Support (新乡高新技术项目资 Financial allocation 1,861,111.08 0.00 28,198.68 0.00 1,832,912.40 Other income Related to assets
金扶持)
Research on Common Co-construction Technology of Financial allocation 2,800,000.00 0.00 0.00 0.00 2,800,000.00 Other income Related to assets
Pharmaceutical Inhalation Preparations (开发区财政局拔款创业
领军人才项目:药品吸入制剂共性共建技术的研究)
Research and development of respiratory system drug and Financial allocation 1,500,000.00 0.00 0.00 0.00 1,500,000.00 Other income Related to assets
clinical research technology service platform project talent
funding (呼吸系统药物研发和临床研究技术服务平台项目人才
经费)
Science and technology help the economy key special projects Financial allocation 500,000.00 0.00 0.00 0.00 500,000.00 Other income Related to assets
(科技助力经济重点专项)
City Service Development Special (市服务发展专项) Financial allocation 800,000.00 0.00 0.00 0.00 800,000.00 Other income Related to assets
Patent funding (专利资助) Financial allocation 200,000.00 0.00 0.00 0.00 200,000.00 Other income Related to assets
2020 Shanghai Professional Technology Platform Capacity Financial allocation 1,000,000.00 0.00 0.00 0.00 1,000,000.00 Other income Related to assets
Enhancement Project (2020 年度上海市专业技术平台能力提升
项目立项)
High-growth small and micro innovation enterprises (高成长小 Financial allocation 400,000.00 0.00 0.00 0.00 400,000.00 Other income Related to assets
微科创企业)
Research and development subsidy for ω-3-Fish Oil Medium and Financial allocation 350,000.00 0.00 350,000.00 0.00 0.00 Other income Related to assets
Long Chain Fat Emulsion Injection (ω-3 鱼油中/长链脂肪乳注射
液研究开发补助)
R&D and industrialization of innovative Ilaprazole Series (艾普拉 Financial allocation 16,078,166.25 0.00 2,455,000.32 0.00 13,623,165.93 Other income Related to assets
唑系列创新药物研发及产业化)
Fund for industrialization of prolonged-action microsphere Financial allocation 12,550,000.00 0.00 0.00 0.00 12,550,000.00 Other income Related to assets
preparation (长效微球制剂的产业化款项)
Construction project for industrialization of prolonged-action Financial allocation 20,719,505.48 0.00 1,202,654.94 0.00 19,516,850.54 Other income Related to assets
microsphere preparation (phase I) (长效微球制剂产业化建设项
目(一期工程))
Project subsidy from the Ministry of Industry and Information Financial allocation 2,400,000.00 0.00 0.00 0.00 2,400,000.00 Other income Related to assets
Technology (工业和信息化部项目补助款)
Project subsidy from the Ministry of Industry and Information Financial allocation 1,366,750.00 0.00 115,500.00 0.00 1,251,250.00 Other income Related to assets
Technology (工业和信息化部项目补助款)
Construction of Drug Conformity Evaluation Research Center Financial allocation 1,040,000.14 0.00 79,999.98 0.00 960,000.16 Other income Related to assets
Platform (药物一致性评价研究中心平台建设)
R&D and Commercialisation of Mouse Nerve Growth Factor for Financial allocation 40,045,946.93 0.00 5,280,044.64 0.00 34,765,902.29 Other income Related to assets
Injection (注射用鼠神经生长因子研发及产业化)
Demonstration project on the application of solar photovoltaic Financial allocation 2,455,499.43 0.00 551,000.04 0.00 1,904,499.39 Other income Related to assets
architecture (太阳能光电建筑应用示范项目)
Subsidy for the Tender of Technology Upgrade Project for PVC Financial allocation 2,703,484.56 0.00 204,182.88 0.00 2,499,301.68 Other income Related to assets
Soft Bag Supported by Provincial Finance Departments (省财政
支持技改招标项目补助金 PVC 软袋)
Technical transformation project of Shenqi Fuzheng Injection Financial allocation 15,676,470.62 0.00 1,911,764.70 0.00 13,764,705.92 Other income Related to assets
with flexible bag (软袋(参芪扶正注射液)技改项目)
Provision for technology transformation funds and subsequent Financial allocation 5,459,555.72 0.00 564,781.68 0.00 4,894,774.04 Other income Related to assets
grants (技术改造资金拨款及事后补奖)
204 Joincare Pharmaceutical Group Industry Co., Ltd.
Item presented Related to
Beginning Additions in Transfer to Other Closing in income assets/Related to
Projects with grants Category balance the period profit or loss movement balance statement income
Provision for technology transformation funds and subsequent Financial allocation 7,359,670.81 0.00 891,684.24 0.00 6,467,986.57 Other income Related to assets
grants (技术改造资金拨款及事后补奖)
Electricity distribution transformer performance enhancement for Financial allocation 380,000.00 0.00 24,000.00 0.00 356,000.00 Other income Related to assets
energy-saving and emission reduction projects ((节能减排项目))
配电变压器能效提升)
R&D and industrialization team of chemical drug liquid Financial allocation 1,534,833.44 234,000.00 28,999.92 0.00 1,739,833.52 Other income Related to assets
preparation (化药液体制剂研发与产业化团队)
Innovation capacity building of technology center (antibody Financial allocation 4,802,478.80 0.00 222,877.68 0.00 4,579,601.12 Other income Related to assets
laboratory) (技术中心创新能力建设(抗体药物实验室))
Achievement transfer of blood screening (BCI) nucleic acid Financial allocation 3,961,282.44 0.00 0.00 0.00 3,961,282.44 Other income Related to assets
detection testing (血液筛查(BCI)核酸检测试剂成果转化)
Technological upgrading and transformation projects of Financial allocation 464,285.80 0.00 53,571.42 0.00 410,714.38 Other income Related to assets
workshop for acarbose (APIs for α-glucosidase inhibitor) (α-葡萄
糖苷酶抑制剂类原料药阿卡波糖生产车间工艺升级技术改造
项目)
R&D and industrialization of Statins (降血脂他汀类药物的研发 Financial allocation 30,000.48 0.00 14,999.94 0.00 15,000.54 Other income Related to assets
与产业化)
Scientific technology award and subsidy for technological Financial allocation 28,566.20 0.00 28,566.20 0.00 0.00 Other income Related to assets
innovative project (科学技术奖及科技创新项目资助)
Commissioner workstation (特派员工作站) Financial allocation 85,000.00 0.00 30,000.00 0.00 55,000.00 Other income Related to assets
Industrial revitalisation supporting funds (产业振兴扶持资金) Financial allocation 2,445,500.01 0.00 579,000.00 0.00 1,866,500.01 Other income Related to assets
Phase IV clinical study of innovative drug Ilaprazole (创新药物艾 Financial allocation 8,210,800.00 0.00 8,210,800.00 0.00 0.00 Other income Related to assets
普拉唑 IV 期临床研究)
Government grant for industrial transformation (工业转型政府扶 Financial allocation 308,333.75 0.00 99,999.96 0.00 208,333.79 Other income Related to assets
持资金)
New industrialization development grant (新型工业化发展奖金) Financial allocation 3,584,066.38 0.00 175,000.02 0.00 3,409,066.36 Other income Related to assets
Policy fund for leading industrial enterprises loan Interests (工业 Financial allocation 366,666.57 0.00 100,000.02 0.00 266,666.55 Other income Related to assets
龙头企业贷款贴息政策资金)
Supporting funds for five advantageous industrial clusters and Financial allocation 300,000.20 0.00 49,999.98 0.00 250,000.22 Other income Related to assets
one high-tech industry (五优一新扶持资金)
Capital project for innovation and entrepreneurship team Financial allocation 12,500,000.00 0.00 0.00 0.00 12,500,000.00 Other income Related to assets
funding program (创新创业团队资助计划资金项目)
2020 Zhuhai City Innovation and Entrepreneurship Team Financial allocation 1,500,000.00 0.00 0.00 0.00 1,500,000.00 Other income Related to assets
(Nanocrystalline) (2020 年度珠海市创新创业团队(纳米晶))
Fund for R&D and industrialization of innovative Ilaprazole series Financial allocation 5,600,000.00 0.00 5,600,000.00 0.00 0.00 Other income Related to assets
(R&D and industrialization of innovative Ilaprazole Series (艾普拉
唑系列创新药物研发及产业化))项目资金)
Key projects of industrial core and key technologies of Zhuhai Financial allocation 3,000,000.00 0.00 0.00 0.00 3,000,000.00 Other income Related to assets
(Ryanodex) (珠海市产业核心和关键技术攻关方向项目(丹曲林
钠))
Data-driven industrial chain collaboration platform Financial allocation 3,650,000.00 0.00 365,000.00 0.00 3,285,000.00 Other income Related to assets
demonstration project (数据驱动的产业链协同平台示范项目)
Fund for key projects of industrial core and key technologies of Financial allocation 2,000,000.00 0.00 0.00 0.00 2,000,000.00 Other income Related to assets
Zhuhai (2nd batch) (珠海市产业核心和关键技术攻关方向项目
资金(第二批))
Innovative drug of Ilaprazole sodium for injection (创新药注射用 Financial allocation 2,400,000.00 0.00 0.00 0.00 2,400,000.00 Other income Related to assets
艾普拉唑钠针剂)
Technological transformation projects of new Cefuroxime (新型 Financial allocation 1,533,100.00 0.00 0.00 0.00 1,533,100.00 Other income Related to assets
头孢粉针剂技术改造项目)
Advanced Pharmaceutical Manufacturing Internet Benchmarking Financial allocation 675,000.00 0.00 45,000.00 0.00 630,000.00 Other income Related to assets
Project (先进药品制造互联网标杆项目)
Cleaner Production Audit Project (清洁生产审核项目) Financial allocation 180,000.08 0.00 4,999.98 0.00 175,000.10 Other income Related to assets
Green factory (绿色工厂) Financial allocation 1,131,666.71 0.00 64,999.98 0.00 1,066,666.73 Other income Related to assets
HCG project construction (HCG 项目建设) Financial allocation 3,387,835.84 0.00 197,824.98 0.00 3,190,010.86 Other income Related to assets
Sewage treatment system upgrade project (污水处理系统升级 Financial allocation 64,239.92 0.00 4,015.02 0.00 60,224.90 Other income Related to assets
改造项目)
lnterim Report 2022 205
Item presented Related to
Beginning Additions in Transfer to Other Closing in income assets/Related to
Projects with grants Category balance the period profit or loss movement balance statement income
R&D and industrialization of Recombinant Human Chorionic Financial allocation 1,137,500.00 0.00 75,000.00 0.00 1,062,500.00 Other income Related to assets
Gonadotropin for Injection (注射用重组人绒促性素研发及产业
化)
Subsidies for online monitoring equipment and installations of Financial allocation 82,500.00 0.00 11,250.00 0.00 71,250.00 Other income Related to assets
coalfired boilers (燃煤锅炉在线监控设备装置补助)资金)
Funds for joint R&D and industrialization of integrated platform Financial allocation 181,632.12 0.00 0.00 0.00 181,632.12 Other income Related to assets
for molecular diagnostics (集成一体化分子诊断平台的合作研发
及产业化)资金)
Project supporting fund for the first batch of special funds for Financial allocation 600,000.00 0.00 0.00 0.00 600,000.00 Other income Related to assets
scientific and technological innovation in 2019 (2019 年度第一
批科技创新专项资金立项配套资助)
Provincial industrial innovation (provincial enterprise technology Financial allocation 1,046,533.33 0.00 0.00 0.00 1,046,533.33 Other income Related to assets
center) project in 2019 (2019 年度省产业创新(省级企业技术中
心)项目)
Pre-appropriation of special grants for industrialization of Financial allocation 4,116,415.65 0.00 0.00 0.00 4,116,415.65 Other income Related to assets
diagnostic reagents for COVID-19 (新型冠状病毒检测试剂产业
化项目补助金预拨)
Xiangzhou District equipment purchase subsidy supporting Financial allocation 11,467.25 0.00 0.00 0.00 11,467.25 Other income Related to assets
funds ((香洲区采购设备补贴扶持资金(疫情防控专项资金)
Zhuhai innovation and enterprising team and high-level talent Financial allocation 12,000,000.00 0.00 0.00 0.00 12,000,000.00 Other income Related to assets
enterprising project Phase I funds (珠海市创新创业团队和高层
次人才创业项目首期资金)
Development and Industrialization of Cyclosporine Self- Financial allocation 0.00 240,000.00 2,000.00 0.00 238,000.00 Other income Related to assets
Emulsifying Soft Capsule Formulation with High Technology (高
技术屏障的环孢素自乳化软胶囊制剂的开发及产业化研究)
Guangdong Provincial Key Laboratory of Characteristic Drug Financial allocation 0.00 1,000,000.00 8,333.33 0.00 991,666.67 Other income Related to assets
Research and Development Enterprises (广东省特色药物研发企
业重点实验室)
Overall relocation and deployment expansion project (整体搬迁 Financial allocation 20,000,000.00 30,000,000.00 0.00 0.00 50,000,000.00 Other income Related to assets
调迁扩建项目)
2022 Special funds for the reconstruction of the industrial base of Financial allocation 0.00 32,740,000.00 0.00 0.00 32,740,000.00 Other income Related to assets
the central government and the high-quality development of the
manufacturing industry (2022 年中央财政产业基础再造和制造
业高质量发展专项资金)
Subsidy Fund LZM009 for National Science and Technology Major Financial allocation 0.00 4,744,900.00 2,171,293.53 0.00 2,573,606.47 Other income Related to assets
Special Projects (国家科技重大专项项目后补助资金 LZM009)
Xiangzhou District actively responds to the impact of the Financial allocation 0.00 1,644,800.00 0.00 0.00 1,644,800.00 Other income Related to assets
epidemic and stabilizes the innovation-driven technology
industry sub-item (香洲区积极应对和疫情影响保稳创新驱动科
技工业分项)
Environmental protection bureau RTO project special funds (环 Financial allocation 179,999.96 0.00 10,000.02 0.00 169,999.94 Other income Related to assets
保局 RTO 项目资金)
Strategic emerging industries in 2014 (sustained release Financial allocation 16,700,000.00 0.00 0.00 0.00 16,700,000.00 Other income Related to assets
microspheres) (2014 年战略性新兴产业(缓释微球))
Total 433,543,352.40 80,953,200.00 40,060,416.15 2,076,000.00 472,360,136.25
206 Joincare Pharmaceutical Group Industry Co., Ltd.
(2) Government grants recognized in income for the period by gross method
Amount Amount
recognised in recognised in
profit or loss profit or loss Presented in income Related to assets/
Projects with grants Category in prior period in the period statement Related to income
Social security subsidy (社保补助) Financial allocation 61,986.60 0.00 Other income Related to income
Patent grant (专利补助) Financial allocation 10,000.00 2,500.00 Other income Related to income
Job stabilization subsidy Financial allocation 23,920.00 577,232.17 Other income Related to income
Others Financial allocation 124,712.03 2,600.00 Other income Related to income
Maternity benefits (生育津贴) Financial allocation 222,116.49 278,357.04 Other income Related to income
Intellectual Property Rights Protection Financial allocation 0.00 58,000.00 Other income Related to income
Funding (知识产权维权资助)
Talent quality improvement project (人才素 Financial allocation 0.00 100,000.00 Other income Related to income
质提升工程项目款)
Nanshan Bole Award (南山伯乐奖) Financial allocation 0.00 20,000.00 Other income Related to income
Pay the 2021 talent housing subsidy – Financial allocation 0.00 2,000.00 Other income Related to income
the remaining RMB20,000 subsidize the
company (支付21年人才住房补贴 － 余下
两万补贴公司)
BIS Financial allocation 0.00 175,000.02 Other income Related to assets
2022 High-tech Enterprise Cultivation Financial allocation 0.00 500,000.00 Other income Related to income
Funding (2022年高新技术企业培育资助)
Water Saving Carrier Incentive Fund (节水载 Financial allocation 0.00 153,203.50 Other income Related to income
体奖励资金)
2022 Industrial “Carbon Peak” Subsidy (2022 Financial allocation 0.00 100,000.00 Other income Related to income
年工业“碳达峰”补贴)
Marine small molecule peptide beauty Financial allocation 40,000.02 40,000.02 Other income Related to assets
moisturizing health drink project (海洋小分
子肽美容补水保健饮料项目)
Domestic patent annual fee incentive (国内 Financial allocation 2,500.00 0.00 Other income Related to income
专利年费奖励)
Shenzhen Economic and Trade Bureau Financial allocation 387,715.44 0.00 Other income Related to income
Electricity Cost Reduction Subsidy (深圳经
贸局用电降成本补助)
Enterprise R&D investment plan (企业研发 Financial allocation 1,000,000.00 0.00 Other income Related to income
投入计划)
Bone and joint repair and health care (骨关 Financial allocation 59,853.12 59,853.12 Other income Related to assets
节修复与保健)
Amortization of special funds for Financial allocation 0.00 808,050.00 Other income Related to assets
engineering laboratories (工程实验室专项
资金项目摊销)
Amortization of special funds for powder Financial allocation 0.00 121,000.02 Other income Related to assets
spray production line (粉雾生产线专项资
金项目摊销)
2022 High-tech Enterprise Cultivation Financial allocation 0.00 500,000.00 Other income Related to income
Funding (2022 年高新技术企业培育资助)
Industrial Development Fund (Green Financial allocation 0.00 200,000.00 Other income Related to income
Factory) Project Funding (产业发展资金(绿
色工厂)项目资助经费)
lnterim Report 2022 207
Amount Amount
recognised in recognised in
profit or loss profit or loss Presented in income Related to assets/
Projects with grants Category in prior period in the period statement Related to income
Industrial Development Fund Energy Financial allocation 0.00 14,000.00 Other income Related to income
Management System Certification Subsidy
(产业发发展资金能源管理体系认证资助)
Insurance premium subsidy for export from Financial allocation 0.00 259,097.00 Other income Related to income
July to December 2020 (2020 年 07-12 月出
口用保险保费资助款)
Expansion and improve efficiency (扩产增 Financial allocation 0.00 620,000.00 Other income Related to income
效)
Production line project funding (生产线项 Financial allocation 0.00 2,045,300.00 Other income Related to income
目资助)
Project funding for enterprises that meet Financial allocation 0.00 1,145,100.00 Other income Related to income
the standards for value-added growth (增加
值增速达标企业项目资助)
Insurance premium subsidy for export (出口 Financial allocation 0.00 110,000.00 Other income Related to income
用保险保费资助款)
Major special project injection lipid research Financial allocation 0.00 500,000.00 Other income Related to assets
funding (重大专项项目注射脂质研究经费)
China Patent Award Supporting Award (中 Financial allocation 0.00 200,000.00 Other income Related to income
国专利奖配套奖)
“Carbon Peak” work pilot demonstration Financial allocation 0.00 500,000.00 Other income Related to income
project funding“碳达峰”工作试点示范项
(
目资助款)
Electricity Subsidy (用电补贴) Financial allocation 793,292.78 625.38 Other income Related to income
Insurance premium subsidy for export (出口 Financial allocation 347,965.00 0.00 Other income Related to income
用保险保费资助款)
2020 Yantian District Enterprise Trial Post Financial allocation 153,240.00 0.00 Other income Related to income
(Training Subsidy) Batch 9 (2020 年盐田区
企业试岗(培训补贴)第 9 批次)
The first batch of funding support for the Financial allocation 200,000.00 0.00 Other income Related to income
development of science and technology
industries in 2021 (2021 年第一批科技类产
业发展资金扶持资助)
One-time employment subsidy (一次性吸 Financial allocation 62,400.00 0.00 Other income Related to income
纳就业)补贴
Corporate research and development Financial allocation 871,000.00 0.00 Other income Related to income
funding (企业研究开发资助)
Industrial added value growth rate Financial allocation 2,880,000.00 0.00 Other income Related to income
compliance projects (工业增加值增速达标
项目)
2021 Project investment in weak links in the Financial allocation 3,000,000.00 0.00 Other income Related to income
industrial chain (2021 年产业链薄弱环节投
资项目)
Shenzhen New Inhalant Engineering Financial allocation 538,700.00 0.00 Other income Related to assets
Laboratory Subsidy (深圳新型吸入剂工程
实验室补助)
208 Joincare Pharmaceutical Group Industry Co., Ltd.
Amount Amount
recognised in recognised in
profit or loss profit or loss Presented in income Related to assets/
Projects with grants Category in prior period in the period statement Related to income
2020 Enterprise R&D Financial Subsidy Financial allocation 0.00 1,400,000.00 Other income Related to income
Special Subsidy Fund District Matching
Fund (2020 年企业研发财政补助专项补助
资金区配套资金)
Export Credit Insurance (出口信保费) Financial allocation 0.00 651,400.00 Other income Related to income
Support enterprise development funds (扶 Financial allocation 0.00 1,503,000.00 Other income Related to income
持企业发展资金)
Return of land holding tax Financial allocation 53,514.87 703,111.26 Other income Related to assets
Construction of 500 cubic meters/day Financial allocation 9,708.66 0.00 Other income Related to assets
wastewater membrane concentration
system (建设 500 立方米/日废水膜浓缩系
统)
Subsidy funds allocated by the Bureau of Financial allocation 649,596.47 0.00 Other income Related to assets
Finance (财政局拨付补助资金)
Enterprise R&D Subsidy Fund (企业研发补 Financial allocation 720,000.00 0.00 Other income Related to income
助资金)
2019 SME subsidies (2019 中小开补贴) Financial allocation 107,500.00 0.00 Other income Related to income
Export credit insurance subsidy in the Financial allocation 304,900.00 0.00 Other income Related to income
second half of 2019 (2019 年下半年(出口信
保补贴)资金)
Subsidies for work-based training (以工代训 Financial allocation 77,547.17 0.00 Other income Related to income
补贴)
Advanced Group and Advanced Individual Financial allocation 20,000.00 0.00 Other income Related to income
Subsidy in 2020 (2020 年度先进集团和先进
个人补助)
Recruitment of social insurance subsidies for Financial allocation 0.00 70,242.16 Other income Related to income
non-employment difficulties in the fourth
quarter of 2021 (2021 年第 4 季度招用非就
业困难社会保险补贴)
Recruitment of social insurance subsidies Financial allocation 0.00 60,501.27 Other income Related to income
for non-employment difficulties in the first
quarter of 2022 (2022 年第 1 季度招用非就
业困难社会保险补贴)
One-time job retention allowance (一次性 Financial allocation 0.00 25,750.00 Other income Related to income
留工补助)
Unemployment benefits in Guangzhou (广 Financial allocation 0.00 35,942.96 Other income Related to income
州市失业待遇)
Second tranche of high-level subsidies Financial allocation 0.00 400,000.00 Other income Related to income
(40%) in 2019 (2019 年认定高企补贴第二
笔(40%))
District Innovation Voucher Funding (区创 Financial allocation 0.00 43,400.00 Other income Related to income
新券资助)
Innovative talent support during the “13th Financial allocation 500,000.00 0.00 Other income Related to income
Five-Year Plan” period in Pudong New
District (浦东新区“十三五”期间创新型人
才扶持)
lnterim Report 2022 209
Amount Amount
recognised in recognised in
profit or loss profit or loss Presented in income Related to assets/
Projects with grants Category in prior period in the period statement Related to income
One-time job training subsidy (一次性留工 Financial allocation 0.00 29,375.00 Other income Related to income
培训补助)
Funding for pilot demonstration projects of Financial allocation 0.00 100,000.00 Other income Related to income
industrial carbon peaking work (工业碳达峰
工作试点示范项目资助款)
Second batch of special funds for scientific Financial allocation 767,637.00 0.00 Other income Related to income
and technological innovation in 2020 (2020
年度科技创新专项资金第二批资助)
One-time job retention allowance (一次性 Financial allocation 0.00 4,000.00 Other income Related to income
留工补助)
Land Support Fund (土地扶持资金) Financial allocation 0.00 28,198.68 Other income Related to assets
Water company refunds differentiated Financial allocation 0.00 13,918.10 Other income Related to income
sewage treatment fee from August to
October 2021 (水务公司退还 2021 年 8-
月-10 月差别化污水处理费)
VAT relief for veterans (退役军人减免增值 Financial allocation 0.00 54,750.00 Other income Related to income
税)
2021 Provincial Special Fund for Foreign Financial allocation 0.00 20,000.00 Other income Related to income
Economic and Trade Development (2021 年
度省级外经贸发展专项资金)
Special funds for corporate R&D financial Financial allocation 265,000.00 0.00 Other income Related to income
subsidies in 2020 (2020 年企业研发财政补
助专项资金)
Return of land transfer fee (土地出让金返 Financial allocation 28,198.68 0.00 Other income Related to assets
还)
Incremental value-added tax refund (增值税 Financial allocation 0.00 2,781.07 Other income Related to income
增量留抵退税)
Export credit insurance subsidy (出口信保 Financial allocation 258,812.70 1,110,960.80 Other income Related to income
补贴)
R&D subsidy (研究开发费补助) Financial allocation 2,420,000.00 950,440.00 Other income Related to income
Research and development funds for new Financial allocation 0.00 5,924,000.00 Other income Related to income
drug for Class I Treatment of Necrosis Factor
in Human Tumour from Human Source (I 类
治疗用人源化抗人肿瘤坏死因子 α 单克隆
抗体新药的研制资金)
Government Subsidy for Long-acting Financial allocation 431,665.47 1,202,654.94 Other income Related to assets
Microspheres Major New Drug Creation (长
效微球重大新药创制政府补助)
R&D and industrialization of innovative Financial allocation 2,455,000.02 16,265,800.32 Other income Related to assets
Ilaprazole Series (艾普拉唑系列创新药物研
发及产业化)
Construction of Drug Conformity Evaluation Financial allocation 80,000.00 79,999.98 Other income Related to assets
Research Center Platform (药物一致性评价
研究中心平台建设)
Conformity Evaluation Research of Quality Financial allocation 115,500.00 115,500.00 Other income Related to assets
of Varieties such as Livzon Dele (丽珠得乐
等品种质量一致性评价研究)
210 Joincare Pharmaceutical Group Industry Co., Ltd.
Amount Amount
recognised in recognised in
profit or loss profit or loss Presented in income Related to assets/
Projects with grants Category in prior period in the period statement Related to income
Advanced Pharmaceutical Manufacturing Financial allocation 45,000.00 45,000.00 Other income Related to assets
Internet Benchmarking Project (先进药品制
造互联网标杆项目)
R&D and industrialization of Recombinant Financial allocation 75,000.00 75,000.00 Other income Related to assets
Human Chorionic Gonadotropin for
Injection (注射用重组人绒促性素研发及产
业化)
HCG project construction (HCG 项目建设) Financial allocation 197,825.00 197,824.98 Other income Related to assets
Fiscal Subsidy and Operating Subsidy (财政 Financial allocation 83,032,194.60 21,859,039.00 Other income Related to income
补贴及经营运营补贴)
R&D and Commercialisation of Mouse Nerve Financial allocation 5,280,044.56 5,280,044.64 Other income Related to assets
Growth Factor for Injection (注射用鼠神经
生长因子研发及产业化)
Provincial Science and Technology Financial allocation 444,166.64 28,999.92 Other income Related to assets
Innovation Strategy Special Fund (省科技创
新战略专项资金)
Import interest discount and supporting Financial allocation 0.00 211,356.00 Other income Related to income
funds (进口贴息及配套资金)
Promoting Imports of Foreign Trade Financial allocation 0.00 1,230,271.00 Other income Related to income
Development Special Fund (外贸经济发展
专项资金)
Technological upgrading and Financial allocation 53,571.42 53,571.42 Other income Related to assets
transformation projects of workshop for
acarbose (APIs for α-glucosidase inhibitor)
(α-葡萄糖苷酶抑制剂类原料药阿卡波糖生
产车间工艺升级技术改造项目)
Subsidy for the Tender of Technology Financial allocation 204,182.88 204,182.88 Other income Related to assets
Upgrade Project for PVC Soft Bag Supported
by Provincial Finance Departments (省财政
支持技改招标项目补助金 PVC 软袋)
Technical transformation project of Shenqi Financial allocation 1,911,764.70 1,911,764.70 Other income Related to assets
Fuzheng Injection with flexible bag (软袋
(参芪扶正注射液)技改项目)
Demonstration project on the application of Financial allocation 551,000.02 551,000.04 Other income Related to assets
solar photovoltaic architecture (太阳能光电
建筑应用示范项目)
Subsidies for high and new technology Financial allocation 0.00 100,000.00 Other income Related to income
enterprises and high and new technology
products (高新技术企业及高新技术产品项
目补贴)
Provision for technology transformation Financial allocation 0.00 3,687,400.00 Other income Related to income
funds and subsequent grants (技术改造资
金拨款及事后补奖)
Provision for technology transformation Financial allocation 2,209,246.44 1,257,556.68 Other income Related to assets
funds and subsequent grants (技术改造资
金拨款及事后补奖)
lnterim Report 2022 211
Amount Amount
recognised in recognised in
profit or loss profit or loss Presented in income Related to assets/
Projects with grants Category in prior period in the period statement Related to income
R&D and industrialization of Statins (降血脂 Financial allocation 14,999.94 14,999.94 Other income Related to assets
他汀类药物的研发与产业化)
Technology transformation of recycling Financial allocation 0.00 198,909.24 Other income Related to assets
system of Acarbose project (阿卡波糖糖回
收系统技术改造项目)
Commissioner workstation (特派员工作站) Financial allocation 30,000.00 30,000.00 Other income Related to assets
Special Fund and Encouraging funds for Financial allocation 628,000.00 150,000.00 Other income Related to income
Energy Saving and Emission Reduction (节
能减排专项资金及奖励金)
Energy-saving and emission reduction Financial allocation 43,015.02 43,015.02 Other income Related to assets
projects (节能减排项目)
Scientific technology award and subsidy for Financial allocation 1,200,000.00 1,140,000.00 Other income Related to income
technological innovative project (科学技术
奖及科技创新项目资助)
Scientific technology award and subsidy for Financial allocation 305,462.80 28,566.20 Other income Related to assets
technological innovative project (科学技术
奖及科技创新项目资助)
Postdoctoral station establishment and Financial allocation 100,000.00 0.00 Other income Related to income
scientific research subsidies (博士后建站和
科研补贴)
Patent (Intellectual Property) Support Fund Financial allocation 779,370.00 0.00 Other income Related to income
(专利(知识产权)资助资金)
Structure-efficiency optimization of marine Financial allocation 0.00 216,622.02 Other income Related to income
microorganisms and evaluation of antitumor
activity (海洋微生物构效优化与抗肿瘤活
性评价)
Policy fund for leading industrial enterprises Financial allocation 100,000.02 100,000.02 Other income Related to assets
loan Interests (工业龙头企业贷款贴息政策
资金)
Government grant for industrial Financial allocation 99,999.96 99,999.96 Other income Related to assets
transformation (工业转型政府扶持资金)
Reward Fund for Industry Growth and Financial allocation 0.00 42,600.00 Other income Related to income
Production Expansion (工业保值增长及增
产奖励)
New industrialization development funds Financial allocation 175,000.02 175,000.02 Other income Related to assets
(新型工业化发展资金)
Industrial revitalisation supporting funds (产 Financial allocation 579,000.00 579,000.00 Other income Related to assets
业振兴扶持资金)
Industrial supporting funds (产业扶持资金) Financial allocation 143,000.00 0.00 Other income Related to income
Supporting funds for five advantageous Financial allocation 49,999.98 49,999.98 Other income Related to assets
industrial clusters and one high-tech
industry (五优一新扶持资金)
Employment Assurance and Re- Financial allocation 769,100.46 1,690,234.86 Other income Related to income
employment and Attraction to Graduates of
Tertiary Academic Institutions Subsidy (企业
稳岗及再就业和吸纳高校毕业生补贴款)
212 Joincare Pharmaceutical Group Industry Co., Ltd.
Amount Amount
recognised in recognised in
profit or loss profit or loss Presented in income Related to assets/
Projects with grants Category in prior period in the period statement Related to income
Enterprise Technology Center Innovation Financial allocation 222,877.68 222,877.68 Other income Related to assets
Capacity Development (Antibody
Laboratory) (企业技术中心创新能力建设
(抗体药物试验室))
Enterprise Technology Center Innovation Financial allocation 37,665.18 37,665.18 Other income Related to income
Capacity Development (Antibody
Laboratory) (企业技术中心创新能力建设
(抗体药物试验室))
Subsidy for online monitoring equipment Financial allocation 11,250.00 11,250.00 Other income Related to assets
for coalfired boilers (燃煤锅炉在线监控设
备装置补助)
Special funds for key leading enterprises in Financial allocation 0.00 5,503,400.00 Other income Related to income
the 13th Five-Year Plan (2019) (十三五重点
领军企业专项资金(2019 年)
Green factory (绿色工厂) Financial allocation 65,000.00 64,999.98 Other income Related to assets
Special capital replenishment for industrial Financial allocation 0.00 1,000,000.00 Other income Related to income
enterprise Restructuring (工业企业结构调
整专项资金)
Others Financial allocation 29,000.00 34,170.43 Other income Related to income
Subsidy for Rental and Property Fee of the Financial allocation 67,500.00 0.00 Other income Related to income
Investment and Promotion Center (投促中
心租金及物业费补贴)
Electricity Incentive Funds (用电奖励资金) Financial allocation 301,257.43 0.00 Other income Related to income
Supporting subsidy for “Talents Plan” Financial allocation 150,000.00 583,774.23 Other income Related to income
and subsidy for talents introduction and
cultivation“人才计划”配套补贴及引才育
(
才补贴)
Rewards for the integration of Financial allocation 0.00 500,000.00 Other income Related to income
informatization and industrialization (两化
融合奖励)
Subsidies for work-based training (以工代训 Financial allocation 23,500.00 160,500.00 Other income Related to income
补贴)
Subsidies for insurance fees (保险费用补贴) Financial allocation 0.00 144,322.90 Other income Related to income
Special Funds for Promoting High-quality Financial allocation 328,020.00 0.00 Other income Related to income
Economic Development (促进经济高质量
发展专项资金)
Grants to high-growth technology Financial allocation 1,500,000.00 0.00 Other income Related to income
companies from Dazhangjiang project A04
(大张江项目 A04 对高增长技术企业资助
款)
Inland Transport Subsidy for Export Financial allocation 163,000.00 0.00 Other income Related to income
Enterprises (出口企业内陆运输补助)
Achievement transfer of blood screening Financial allocation 6,000,000.00 0.00 Other income Related to assets
(BCI) nucleic acid detection testing (血液筛
查(BCI)核酸检测试剂成果转化)
lnterim Report 2022 213
Amount Amount
recognised in recognised in
profit or loss profit or loss Presented in income Related to assets/
Projects with grants Category in prior period in the period statement Related to income
Pre-appropriation of special grants for Financial allocation 1,497,000.00 0.00 Other income Related to assets
industrialization of diagnostic reagents for
COVID-19 (新型冠状病毒检测试剂产业化
项目补助金预拨)
“Specialized and new” subsidy“专精特新” Financial allocation
( 0.00 950,000.00 Other income Related to income
补贴)
The Science and Technology Bureau pulls Financial allocation 0.00 741,000.00 Other income Related to income
out the second phase of supporting funds
for the fifth batch of projects in the 2020
provincial key field R&D plan (科技局拔
2020 年省重点领域研发计划第 5 批项目第
二期配套资金)
Factory rental subsidy in Hengqin Financial allocation 0.00 345,012.00 Other income Related to income
Guangdong-Macao Deep Cooperation Zone
(横琴粤澳深度合作区厂房租金补贴)
Development and Industrialization of Financial allocation 0.00 2,000.00 Other income Related to assets
Cyclosporine Self-Emulsifying Soft Capsule
Formulation with High Technology (高技术
屏障的环孢素自乳化软胶囊制剂的开发及
产业化研究)
Guangdong Provincial Key Laboratory Financial allocation 0.00 8,333.33 Other income Related to assets
of Characteristic Drug Research and
Development Enterprises (广东省特色药物
研发企业重点实验室)
Subsidy Fund LZM009 for National Science Financial allocation 0.00 2,171,293.53 Other income Related to assets
and Technology Major Special Projects (国
家科技重大专项项目后补助资金 LZM009)
Data-driven industrial chain collaboration Financial allocation 0.00 365,000.00 Other income Related to assets
platform demonstration project (数据驱动
的产业链协同平台示范项目)
Several measures for payment companies Financial allocation 0.00 200,000.00 Other income Related to income
to tide over the difficulties in response to
the new coronavirus pneumonia epidemic-
financial support project funds (应对新型冠
状病毒肺炎疫情支付企业共渡难关的若干
措施-金融支持项目资金)
Total 129,460,997.27 94,185,202.59
214 Joincare Pharmaceutical Group Industry Co., Ltd.
VI. Change to Consolidation Scope
1. Business combination not involving enterprises under common control
□ Applicable √ N/A
2. Business combination involving enterprises under common control
□ Applicable √ N/A
3. Reverse purchase
□ Applicable √ N/A
4. Disposal of subsidiaries
Was there any circumstance under which a single disposal of the investment in subsidiaries will lose control
□ Applicable √ N/A
Other descriptions:
□ Applicable √ N/A
5. Changes in scope of consolidation due to other reasons
Descriptions of changes in scope of consolidation caused by other reasons (such as establishment of a new subsidiary and
liquidation of a subsidiary, etc.) and their relevant information:
√ Applicable □ N/A
The Company’s subsidiary, Livzon Group’s Subsidiaries Livzon Biotechnology Hong Kong Co., Ltd. established LIVZON
BIOLOGICS (MALAYSIA) SDN. BHD. on January 12, 2022, with registered capital of Malaysia Ringgit 100, and accounts for its
registered capital of 100%.
6. Others
□ Applicable √ N/A
lnterim Report 2022 215
Vii. Equity in Other Entities
1. Interests in subsidiaries
(1). Group structure
√ Applicable □ N/A
Main operating Place of Business Shareholding %
Name of subsidiary location registration nature Direct Indirect Acquisition method
Topsino Industries Limited (Topsino Industries) Hong Kong Hong Kong Business 100 0 Set-up by investment
Shenzhen Taitai Genomics Inc. Co., Ltd. (Taitai Shenzhen Shenzhen Industry 75 25 Set-up by investment
Genomics)
Shenzhen Taitai Pharmaceutical Industry Co., Ltd. Shenzhen Shenzhen Industry 100 0 Set-up by investment
(Taitai Pharmaceutical)
Health Investment Holdings Ltd. (Health Investment) The British Virgin The British Virgin Investment 0 100 Set-up by investment
Islands Islands
Joincare Pharmaceutical Group Industry Co.,Ltd.(BVI)* The British Virgin The British Virgin Investment 0 100 Set-up by investment
Islands Islands
Joincare Pharmaceutical Group Industry Co.,Ltd. Cayman Islands Cayman Islands Investment 0 100 Set-up by investment
(CAYMAN ISLANDS)
Xinxiang Haibin Pharmaceutical Co., Ltd.(Xinxiang Henan Xinxiang Henan Xinxiang Industry 0 100 Set-up by investment
Haibin)
Shenzhen Fenglei Electric Power Investment Co., Ltd. Shenzhen Shenzhen Investment 100 0 Set-up by investment
(Fenglei Electric Power)
Jiaozuo Joincare Bio Technological Co., Ltd.(Jiaozuo Henan Jiaozuo Henan Jiaozuo Industry 75 25 Set-up by investment
Joincare) (Jiaozuo Joincare)
Shanghai Frontier Health Pharmaceutical Technology Shanghai Shanghai Industry 65 0 Set-up by investment
Co., Ltd.(Shanghai Frontier) *Note 2
Shenzhen Taitai Biological Technology Co., Ltd. (Taitai Shenzhen Shenzhen Industry 100 0 Set-up by investment
Biological)
Guangzhou Joincare Respiratory Medicine Guangzhou Guangzhou Industry 0 26 Set-up by investment
Engineering Technology Co., Ltd.(Joincare
Respiratory)
Guangdong Taitai Forenstic Test Institute Shenzhen Shenzhen Business 0 100 Set-up by investment
Joincare Haibin Pharmaceutical Co., Ltd (Joincare Shenzhen Shenzhen Industry 25 75 Set-up by investment
Haibin)
Shenzhen Haibin Pharmaceutical Co., Ltd. (Haibin Shenzhen Shenzhen Industry 97.87 2.13 Business combination
Pharma) not under common
control
Joincare Daily-Use & Health Care Co., Ltd. (Joincare Shenzhen Shenzhen Business 80 20 Business combination
Daily-Use)) not under common
control
Health Pharmaceuticals (China) Limited (Health China) Zhuhai Zhuhai Industry 0 100 Business combination
not under common
control
Livzon Pharmaceutical Group Inc. (Livzon Group) Zhuhai Zhuhai Industry 23.68 21.12 Business combination
*Note 1 & 2 not under common
control
Hong Kong Health Pharmaceutical Industry Company Hong Kong Hong Kong Investment 0 100 Business combination
Limited not under common
control
216 Joincare Pharmaceutical Group Industry Co., Ltd.
Main operating Place of Business Shareholding %
Name of subsidiary location registration nature Direct Indirect Acquisition method
Health Pharmaceutical Industry Company Limited Hong Kong Hong Kong Investment 0 100 Business combination
not under common
control
Shenzhen Hiyeah Industry Co., Ltd (Hiyeah Industry) Shenzhen Shenzhen Business 97.58 2.42 Business combination
not under common
control
Guangzhou Hiyeah Industry Co., Ltd. Guangzhou Guangzhou Industry 0 100 Business combination
not under common
control
Zhongshan Renhe Health Products Co., Ltd. Zhongshan Zhongshan Industry 0 100 Business combination
not under common
control
Shenzhen Jiekang Health Care Co., Ltd. Shenzhen Shenzhen Industry 0 100 Business combination
not under common
control
Joincare (Guangdong) Special medicine Food Co., Ltd. Shaoguan Shaoguan Industry 100 0 Set-up by investment
Henan Joincare Biomedical Research Institute Co., Jiaozuo Jiaozuo Industry 0 70.13 Set-up by investment
Ltd.*Note 3
*Note 1: Shanghai Frontier Health Pharmaceutical Technology Co., Ltd. (上海方予健康医药科技有限公司) and the Company’s subsidiary Livzon Group
established Shanghai Liyu Biomedical Technology Co., Ltd. (上海丽予生物医药技术有限责任公司) on 30 March 2021. Livzon Group holds 55% of the shares
and Shanghai Frontier Health Pharmaceutical Technology Co., Ltd holds 45%.
*Note 2: Zhuhai Livzon Biotechnology Co., Ltd. (珠海市丽珠生物医药科技有限公司) is a subsidiary within the scope of Livzon Group’s consolidation. It was
originally 100% indirectly held by Livzon Group. In the current period, due to the restructuring of the shareholding structure of the subsidiary, Livzon Group
holds 51% of its shares, the Company holds 33.07% of the shares, and YF Pharmab Limited holds 8.43% of the shares and Hainan Lisheng Juyuan Investment
Partnership (Limited Partnership) holds 7.50% of the shares.
*Note 3: Henan Joincare Biomedical Research Institute Co., Ltd. (河南省健康元生物医药研究院有限公司) is a joint venture established on 26 October 2020
by Jiaozuo Joincare Biological Products Co., Ltd. (焦作健康元生物制品有限公司), a subsidiary of the Company, and Livzon Group Xinbeijiang Pharmaceutical
Co., Ltd. (丽珠集团新北江制药股份有限公司), a subsidiary of the Company’s Livzon Group. Jiaozuo Joincare Biological Products Co., Ltd. holds 51% of the
shares. The investee completed its industrial and commercial registration on 26 October 2020.
Other descriptions:
Subsidiaries not included in the scope of consolidation in the current period:
Name of subsidiary Registered Capital Actual investment Interest held
Guangzhou Hiyeah Industry Co., Ltd. 3,000,000.00 3,000,000.00 100%
Zhongshan Renhe Health Products Co., Ltd. 500,000.00 500,000.00 100%
Shenzhen Jiekang Health Care Co., Ltd. 4,000,000.00 4,000,000.00 100%
Guangzhou Hiyeah Industry Co., Ltd. (广州市喜悦实业有限公司), Zhongshan Renhe Health Products Co., Ltd. (中山市仁
和保健品有限公司), are wholly-owned subsidiaries of Shenzhen Hiyeah. They entered the liquidation process in 2008, and
has been out of business for many years, and completed the tax cancellation procedures, so they were not included in the
scope of the consolidated.
Shenzhen Jiekang Health Care Co., Ltd. (深圳市捷康保健有限公司) is wholly-owned subsidiaries of Shenzhen Hiyeah,
which entered the liquidation process in 2008, and has been out of business for many years, and completed the
cancellation by Shenzhen Market Supervision and Administration Bureau on May 30, 2022.
lnterim Report 2022 217
(2). Significant non-wholly owned subsidiaries
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Profit or loss Balance of
Shareholding of attributable to Dividend paid to minority interests
Name of subsidiary minority interest minority interest minority interest at period end
Livzon Group 55.1981% 561,572,328.51 670,811,289.90 7,102,295,405.43
Descriptions of the difference between the shareholding ratio of minority shareholders and their proportion of voting
rights in a subsidiary:
□ Applicable √ N/A
Other descriptions:
□ Applicable √ N/A
(3). Principal financial information of significant non-wholly owned subsidiaries
√ Applicable □ N/A
Unit: 100,000,000 Yuan Currency: RMB
Closing balance Beginning balance
Current Non-current Total Current Non-current Total Current Non-current Total Current Non-current Total
Name of subsidiary assets assets assets liabilities liabilities liabilities assets assets assets liabilities liabilities liabilities
Livzon Group 150.13 79.24 229.38 67.52 21.99 89.51 146.73 76.99 223.72 69.25 11.36 80.61
Current period Prior Period
Cash flow Cash flow
Total from Total from
Comprehensive operating Comprehensive operating
Name of subsidiary Revenue Net profit income activities Revenue Net profit income activities
Livzon Group 63.03 11.18 11.51 14.26 62.36 11.80 10.32 6.75
(4). Significant restrictions on the use of enterprise group assets and settlement of enterprise group debts:
□ Applicable √ N/A
(5). Financial supports or other supports offered for the structured entities included in the scope of consolidated financial
statements:
□ Applicable √ N/A
Other descriptions:
□ Applicable √ N/A
2. Changes in share of owners’ equity in subsidiaries and still controls the subsidiaries
□ Applicable √ N/A
218 Joincare Pharmaceutical Group Industry Co., Ltd.
3. Interests in joint arrangements or associates
√ Applicable □ N/A
(1). Significant joint arrangements or associates
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Name of joint Shareholding (%) Accounting
arrangements or Main operating Place of treatment of joint
associates location registration Business nature Direct Indirect investment
Jiaozuo Jinguan Jiahua Jiaozuo City, Jiaozuo City, Electricity production, 0.00 49 Equity method
Electric Power Co., Ltd. Henan Province Henan Province
Tianjin Tongrentang Tianjin Tianjin Manufacture of medicine 0.00 40.00 Equity method
Group Co., Ltd.
(2). Key financial information of significant joint arrangements
□ Applicable √ N/A
(3). Main financial information of significant associates
√ Applicable □ N/A
① Jinguan Electric Power
Unit: Yuan Currency: RMB
Closing balance/ Beginning balance/
Amount for Amount for
the period the prior period
Item Jinguan Electric Power Jinguan Electric Power
Current assets 912,376,226.14 900,929,930.10
Including: Cash and cash equivalents 162,284,264.90 151,817,021.98
Non-current assets 287,103,859.48 295,290,603.34
Total assets 1,199,480,085.62 1,196,220,533.44
Current liabilities 622,969,810.80 621,231,810.54
Non-current liabilities 13,525,568.14 13,660,568.14
Total liabilities 636,495,378.94 634,892,378.68
Net assets 562,984,706.68 561,328,154.76
Including: Minority interests 0.00 0.00
Owners’ equity attributable to parent company 562,984,706.68 561,328,154.76
Share of net assets calculated based on shareholding ratio 275,862,506.27 275,050,795.83
Adjustment items
Goodwill
Unrealized profit on internal transactions
Others 9,590,852.41 9,569,113.18
Carrying value of equity investment in associates 285,453,358.68 284,619,909.02
Fair value of publicly quoted equity investments of associates
Operating income 545,919,608.69 326,758,406.59
Financial expenses 5,790,628.01 9,179,331.31
Income tax expenses 0.00 1,776,961.35
Net profit 1,656,551.92 5,330,884.06
lnterim Report 2022 219
Closing balance/ Beginning balance/
Amount for Amount for
the period the prior period
Item Jinguan Electric Power Jinguan Electric Power
Net profit from discontinued operations
Other comprehensive income
Total comprehensive income 1,656,551.92 5,330,884.06
Net cash flows from operating activities 120,800,417.88 -103,889,799.14
Dividends received from joint ventures in the current period
② Tianjin Tongrentang Group Co., Ltd.
Tianjin Tongrentang Group Co., Ltd.
Item 2022.6.30
Owners’ equity attributable to parent company 624,133,283.11
Share of net assets by shareholding 249,653,313.24
Adjustments
Including: Goodwill 498,457,683.68
Unrealized profit or loss in internal transactions 0.00
Provision for impairment 0.00
Others 0.00
Carrying value of equity investment in associates 748,110,996.92
Fair value of publicly quoted equity investments Suspension from 22 June 2021
Continued:
Tianjin Tongrentang Group Co., Ltd.
Item Amount for the period
Operating income 548,022,065.65
Dividends received by the company from associates in the current period 51,920,000.00
Other descriptions:
√ Applicable □ N/A
The Company calculated share of assets by shareholding ratio based on the amount attributable to the parent company in
the associates’ consolidated financial statements. The amounts of associates on the consolidated financial statements take
into account the fair value of net identifiable assets and liabilities of the associate when acquiring the investment and the
effect of unifying accounting policies.
As Tianjin Tongrentang is in the IPO application stage, the above data is based on the performance forecast.
220 Joincare Pharmaceutical Group Industry Co., Ltd.
(4). Summary of financial information of other insignificant associates
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Closing balance/ Beginning balance/
Current period Prior period
Associates:
Total carrying amount of investment 389,448,001.30 326,526,576.36
The following amount are calculated on the basis of shareholding ratio
Net profit -5,650,897.40 -7,855,283.00
Other comprehensive income 0.00 0.00
Total comprehensive income -5,650,897.40 -7,855,283.00
(5). Description of significant restrictions on the ability of joint ventures or associates to transfer funds to the company
□ Applicable √ N/A
(6). Excess losses incurred by joint ventures or associates
□ Applicable √ N/A
(7). Unconfirmed commitments related to joint venture investment
□ Applicable √ N/A
(8). Contingent liabilities related to investments in joint ventures or associates
□ Applicable √ N/A
4. Important joint operations
□ Applicable √ N/A
5. Equity in structured entities not included in the scope of consolidated financial statements
Relevant descriptions of structured entities not included in the scope of consolidated financial statements:
□ Applicable √ N/A
6. Others
□ Applicable √ N/A
lnterim Report 2022 221
VIII. Risks Management of Financial Instruments
√ Applicable □ N/A
The major financial instruments of the Company include cash, bills receivable and accounts receivable, other receivables,
non-current assets due within one year, other current assets, financial assets held for trading, other equity instrument
investments, long-term receivables, bills payable and accounts payable, other payables, short-term borrowings, financial
liabilities held for trading, non-current liabilities due within one year, short-term borrowings, bonds payable and long-
term payables.. The details of these financial instruments are disclosed in the respective notes. The financial risk of these
financial instruments and financial management policies used by the Company to minimize the risk are disclosed as
below. The management of the Company manages and monitors the exposure of these risks to ensure the above risks are
controlled in the limited range.
1. Management objectives and policies of risks
The operation activities of the Company are subject to various financial risks: market risks (mainly including foreign
exchange risks and interest rate risks), credit risks and liquidity risks. The Company formulates an overall risk management
plan with respect to the unforeseeability of the financial market in order to minimise the potential adverse impacts on the
financial performance of the Company.
(1) Foreign exchange risks
The Company conducts its operation primarily in China. Substantially all of the transactions were denominated and
settled in Renminbi. However, the Company still has certain imports and exports businesses regarding APIs and diagnostic
reagents that are settled in U.S. dollar, Euro and Japanese Yen. The Company’s businesses outside China (mainly in Hong
Kong, India, Europe) are settled in Hong Kong dollars, U.S. dollar and Eurodollar. In addition, the Company will have
foreign currency loans according to the operating needs. In respect of the above, the Company still exposes to certain
foreign exchange risks. Taking into account the foreign exchange risks acceptable by the Company, the Company adopted
Derivative instruments to control foreign exchange risk. However, as to the foreign exchange risk in loans, the Company
shall closely monitor the trend of the exchange rate of Renminbi, and timely adjust the extent of borrowings, so as to
minimise its risks.
Financial assets and liabilities in foreign currencies held by the Company expressed in Renminbi are stated below:
① As at 2022.06.30
Unit: 1,000 Yuan
Item HKD USD EUR JPY GBP MOP
Financial assets in foreign
currency –
Cash and bank balances 658,432.94 1,386,195.91 543.04 4,769.27 15.79 4,177.69
Financial assets held for trading 83,917.72 0.00 0.00 0.00 0.00 0.00
Accounts receivable 0.00 630,256.13 1,456.00 0.00 0.00 1,055.84
Other receivables 2,837.98 156.02 0.00 0.00 0.00 482.10
Other equity instruments 470,537.12 0.00 0.00 0.00 0.00 0.00
investment
Subtotal: 1,215,725.75 2,016,608.06 1,999.04 4,769.27 15.79 5,715.62
Financial liabilities in foreign 0.00 0.00 0.00 0.00 0.00 0.00
currency –
Accounts payable 0.00 2,738.78 39.71 6,066.54 0.00 0.00
Other payables 1,186.21 30,544.26 0.00 0.00 0.00 0.00
Subtotal: 1,186.21 33,283.04 39.71 6,066.54 0.00 0.00
222 Joincare Pharmaceutical Group Industry Co., Ltd.
② As at 2021.12.31
Unit: 1,000 Yuan
Item HKD USD EUR JPY GBP MOP
Financial assets in foreign
currency –
Cash and bank balances 516,034.78 1,296,568.06 559.42 2,406.62 16.70 1,121.33
Financial assets held for trading 163,071.45 0.00 0.00 0.00 0.00 0.00
Accounts receivable 0.00 579,062.08 4,493.18 0.00 0.00 2,824.85
Other receivables 2,712.73 0.00 0.00 0.00 0.00 461.23
Other equity instruments 480,531.75 0.00 0.00 0.00 0.00 0.00
investment
Subtotal: 1,162,350.71 1,875,630.14 5,052.60 2,406.62 16.70 4,407.41
Financial liabilities in foreign 0.00 0.00 0.00 0.00 0.00 0.00
currency –
Accounts payable 0.00 213.29 40.90 0.00 0.00 11.01
Other payables 2,503.18 16,034.63 0.00 0.00 0.00 0.00
Subtotal: 2,503.18 16,247.92 40.90 0.00 0.00 11.01
As at 30 June 2022, in respect of the Company’s financial assets and liabilities denominated in foreign currencies such as
Hong Kong dollar, U.S. dollar, Euro, Japanese Yen and Macau Pataca, should the value of RMB appreciate or depreciate
by 5% against foreign currencies such as Hong Kong dollar, U.S. dollar, Euro, Japanese Yen and Macau Pataca, and
other factors remain unchanged, the Company would be subject to an increase or decrease in profit of approximately
RMB160,212,900 (31 December 2021: approximately RMB151,553,060).
(2). Interest rate risk
The Company’s exposures to interest rate risk are mainly arising from interest-bearing liabilities such as bank borrowings
and bonds payables. The interest rates are affected by the macro monetary policies of China, hence the Company will face
the risks arising from fluctuation of interest rates in the future.
The finance department of the head office of the Company continues to monitor the level of interest rate of the Company.
The rise in the interest rate will increase the cost of additional interest-bearing liabilities and the interest expenses of
the Company’s outstanding interest-bearing liabilities of which the interests are calculated at floating rates, and impose
material adverse impact on the financial results of the Company. The management will make timely adjustment based on
the updated market conditions. The directors of the Company consider that the future changes in the interest rate will
have no material adverse impact on the operating results of the Company.
(3). Credit risk
Credit risk is primarily attributable to cash and cash equivalents, restricted funds, accounts receivables and other
receivables. In respect of cash at banks, they were placed at several banks with good reputations, for which the credit risk
was limited. In respect of receivables, the Company shall assess the credit limit granted to customers for credit purpose.
Moreover, as the customer base of the Company is large, the credit risk on accounts receivables is not concentrated.
In terms of bills receivable settlement, external payments are settled with bills receivable with priority and most of the
remaining bills are high-quality bills with maturity within three months; thus none expected major credit risk exits. In
addition, the provision made on the impairment of accounts receivables and other receivables are adequate to manage
the credit risk.
Among the accounts receivable of the Company, the accounts receivable of the top five customers accounted for 10.28%
(31 December 2021: 11.60%); among the other receivables of the Company, the other receivables of the top five customers
accounted for 46.42% (31 December 2021: 60.63%).
lnterim Report 2022 223
(4). Liquidity risk
The Company adopts prudent liquidity risk management for the sufficient supply of monetary funds and liquidity. It
secures readily available credit loans from banks mainly by maintaining adequate monetary funds and banking facilities.
Apart from indirect financing from banks, a number of financing channels were available, such as direct financing by inter-
bank market including short-term financing bills and medium-term financing bills, corporate bonds etc. These instruments
can effectively reduce the effects of scale of financing and the macro monetary policies of China on indirect bank
financing, which shall secure adequate funds in a flexible manner.
As at the date of the balance sheet, the contractual cash flows of financial assets and financial liabilities are presented
below by term of maturity:
① As at 2022.06.30
Item Within a year 1-2 years 2-5 years Over 5 years Total
Financial assets:
Cash and bank balances 12,653,108,949.17 0.00 0.00 0.00 12,653,108,949.17
Financial assets held for trading 99,806,543.32 0.00 0.00 0.00 99,806,543.32
Notes receivable 1,888,473,693.79 0.00 0.00 0.00 1,888,473,693.79
Accounts receivable 2,895,463,163.96 0.00 0.00 0.00 2,895,463,163.96
Other receivables 50,888,736.71 0.00 0.00 0.00 50,888,736.71
Non-current assets due within one year 38,498.84 0.00 0.00 0.00 38,498.84
Long-term receivables 0.00 82,574.69 0.00 0.00 82,574.69
Subtotal: 17,587,779,585.79 82,574.69 0.00 0.00 17,587,862,160.48
Financial liabilities:
Short-term loans 1,982,775,000.02 0.00 0.00 0.00 1,982,775,000.02
Financial liabilities held for trading 10,791,038.40 0.00 0.00 0.00 10,791,038.40
Notes payable 1,601,063,168.35 0.00 0.00 0.00 1,601,063,168.35
Accounts payable 933,275,211.76 0.00 0.00 0.00 933,275,211.76
Other payables 3,398,357,996.68 0.00 0.00 0.00 3,398,357,996.68
Non-current liabilities due within one year 93,190,354.84 0.00 0.00 0.00 93,190,354.84
Lease liabilities 0.00 12,130,536.90 10,468,645.70 0.00 22,599,182.60
Long term loans 0.00 389,000,000.00 2,014,726,004.58 0.00 2,403,726,004.58
Subtotal: 8,019,452,770.05 401,130,536.90 2,025,194,650.28 0.00 10,445,777,957.23
② As at 2021.12.31
Item Within a year 1-2 years 2-5 years Over 5 years Total
Financial assets:
Cash and bank balances 11,729,230,390.98 0.00 0.00 0.00 11,729,230,390.98
Financial assets held for trading 184,638,344.31 0.00 0.00 0.00 184,638,344.31
Notes receivable 1,977,286,022.02 0.00 0.00 0.00 1,977,286,022.02
Accounts receivable 2,853,655,551.54 0.00 0.00 0.00 2,853,655,551.54
Other receivables 88,053,825.12 0.00 0.00 0.00 88,053,825.12
Non-current assets due within one year 317,381.23 0.00 0.00 0.00 317,381.23
Long-term receivables 0.00 266,904.13 0.00 0.00 266,904.13
Subtotal: 16,833,181,515.20 266,904.13 0.00 0.00 16,833,448,419.33
224 Joincare Pharmaceutical Group Industry Co., Ltd.
Item Within a year 1-2 years 2-5 years Over 5 years Total
Financial liabilities:
Short-term loans 2,518,484,835.09 0.00 0.00 0.00 2,518,484,835.09
Financial liabilities held for trading 143,302.24 0.00 0.00 0.00 143,302.24
Notes payable 1,582,386,767.93 0.00 0.00 0.00 1,582,386,767.93
Accounts payable 871,553,210.51 0.00 0.00 0.00 871,553,210.51
Other payables 3,292,407,989.79 0.00 0.00 0.00 3,292,407,989.79
Non-current liabilities due within one year 91,576,066.33 0.00 0.00 0.00 91,576,066.33
Lease liabilities 0.00 13,186,526.27 11,885,268.05 0.00 25,071,794.32
Long term loans 0.00 466,780,252.78 360,000,000.00 0.00 826,780,252.78
Subtotal: 8,356,552,171.89 479,966,779.05 371,885,268.05 0.00 9,208,404,218.99
2. Capital management
The capital management policies are made to keep the continuous operation of the Company, to enhance the return to
shareholders, to benefit other stakeholders and to maintain the best capital structure to minimize the cost of capital.
For the maintenance or adjustment of the capital structure, the Company might adjust financing method, the amount of
dividends paid to shareholders, return capital to shareholders, issue new shares and other equity instruments or make an
asset disposal to reduce the liabilities.
The Company monitors the capital structure with gearing ratio (calculated by dividing total liabilities by total assets). On
30 June 2022, the Company’s gearing ratio is 37.54% (31 December 2021: 35.12%).
3. Transfer of financial assets
(1). Financial assets which are transferred but have not been derecognised in their entirety
None.
(2). Financial assets which have been transferred and ceased to be recognised but still have involvement with the transferor
As of 30 June 2022, the Company’s carrying amounts of bank acceptance bills undue and endorsed to suppliers for
settling account payables is RMB407,822,740.99 (31 December 2021: RMB186,290,992.91); the Company has no commercial
acceptance bills undue and endorsed to suppliers for settling account payables in the period (31 December 2021: Nil).
The Company’s bank acceptance bill discounted to bank as at 30 June 2022 is RMB429,075,183.95 (31 December 2021:
RMB67,908,033.05), which are having due dates fall into 1 to 12 months. In accordance with the Negotiable Instruments
Law, the holders of the bills have a right of recourse against the Company if payment is refused by the bank of acceptance
(the “Continuing Involvement”). In the opinion of the Company, the Company has transferred substantially all risks and
rewards. Accordingly, their full carrying amounts and the corresponding account payables have been derecognised. The
maximum loss and the undiscounted cash flows from the Continuing Involvement and repurchasing is equal to their
carrying amounts. In the opinion of the Company, the fair values of the Continuing Involvement are not significant.
During the 6-month period ended 30 June 2022, no gain or loss was generated by the Company on the date of transfer
of the bills. The Company had no current or accumulated gain or loss arising from the continuing involvement in financial
assets which had been derecognised. The endorsement was incurred evenly throughout the period.
lnterim Report 2022 225
IX. Fair Value
1. Closing balance of the fair value of assets and liabilities measured at fair value
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Closing balance of fair value
Level 1 fair value Level 2 fair value Level 3 fair value
Item measurement measurement measurement Total
I. Recurring fair value measurement
(I) Financial assets held for trading 99,756,677.76 49,865.56 0.00 99,806,543.32
1. Financial assets at fair value through profit or loss
(1) Debt instruments investment 953,678.89 0.00 0.00 953,678.89
(2) Equity instruments investment 98,802,998.87 0.00 0.00 98,802,998.87
(3) Derivative financial assets 0.00 49,865.56 0.00 49,865.56
2. Financial asset designated as at fair value through
profit or loss
(1) Investments in debt instruments
(2) Investments in equity instruments
(II) Other debt investments
(III) Other investments in equity instruments 0.00 0.00 1,170,558,267.07 1,170,558,267.07
(IV) Investment properties
1. A land use right that is used to be leased out.
2. A building that is leased out.
3. A land use right held for transfer upon capital
appreciation
(V) Biological asset
1. Consumable biological assets
2. Productive biological assets
Total assets measured at fair value on a recurring basis 99,756,677.76 49,865.56 1,170,558,267.07 1,270,364,810.39
(VI) Financial liabilities held for trading
1. Financial liabilities at fair value through profit or loss
Including: Issued tradable bonds
Derivative financial liabilities 0.00 10,791,038.40 0.00 10,791,038.40
Others
2. Financial liabilities designated as at fair value
through profit or loss
Total liabilities measured at fair value on a recurring 0.00 10,791,038.40 0.00 10,791,038.40
basis
II. Non-recurring fair value measurement
(I) Assets held-for-sale 0.00 0.00 0.00 0.00
Total assets measured at fair value on a non-recurring 0.00 0.00 0.00 0.00
basis
Total liabilities measured at fair value on a non- 0.00 0.00 0.00 0.00
recurring basis
In 6-month period ended 30 June 2022, there were no transfers of the fair value measurements between level 1 and level
2 and no transfers into or out of level 3.
226 Joincare Pharmaceutical Group Industry Co., Ltd.
2. Basis for determining the market price of continuous and non-continuous level 1 fair value measurement
items
√ Applicable □ N/A
The basis for determining the market price of level 1 fair value measurement items is when listed and traded on the
Shanghai Stock Exchange, Shenzhen Stock Exchange, Hong Kong Stock Exchange and the United States, its fair value is
determined by the closing price on the last trading day of the reporting period.
3. Valuation techniques and qualitative and quantitative information of key parameters adopted for
continuous and non-continuous level 2 fair value measurement items
√ Applicable □ N/A
For the items in level 2 fair value measurement which uses valuation techniques and qualitative and quantitative
information of important parameters to determine the fair value. For derivative financial instruments such as foreign
exchange forward contracts, the fair value is determined based on the quoted forward exchange rate corresponding to
the expiring contract.
Fair value at the
Item End of the Period Valuation techniques
Derivative financial assets 49,865.56 Calculated and determined based on the quoted forward
exchange rate corresponding to the expiring contract
Derivative financial liabilities 10,791,038.40 Calculated and determined based on the quoted forward
exchange rate corresponding to the expiring contract
4. Valuation techniques and qualitative and quantitative information of key parameters adopted for
continuous and non-continuous level 3 fair value measurement items
√ Applicable □ N/A
For the items in level 3 fair value measurement uses valuation techniques and qualitative and quantitative information of
important parameters to determine the fair value. For some other equity instruments held, the fair value is based on the
cost or the present value of the estimated future net cash flow as the best estimate.
lnterim Report 2022 227
5. Reconciliation between opening and closing carrying amounts and sensitivity analysis of unobservable
parameters for continuous level 3 fair value measurement items
√ Applicable □ N/A
Fair value at the
Item end of the period Valuation techniques
Other equity instruments investment-Shanghai Yunfeng Xinchuang 69,006,351.58 Net assets
Equity Investment Centre (上海云锋新创股权投资中心)
Other equity instruments investment-Shanghai JingYi Investment Centre 67,979,475.21 Net assets
(上海经颐投资中心)
Other equity instruments investment-Qianhai Equity Investment Fund (前 264,930,500.00 Net assets
海股权投资基金)
Other equity instruments investment-Apricot Forest, Inc (杏树林) 137,711,800.01 Income method
Other equity instruments investment-Zhuhai China Resources Bank Co., 164,395,200.00 Market method
Ltd. (珠海华润银行股份有限公司)
Other equity instruments investment-Yizun Biopharmaceutics (Shanghai) 59,999,953.41 Recent financing price
Co., Ltd. (羿尊生物医药(上海)有限公司)
Other equity instruments investment-Zhuhai Medpha Biotechnology Co., 6,971,000.00 Recent financing price
Ltd. (珠海麦得发生物科技股份有限公司)
Other equity instruments investment-Beijing Luzhu Biotechnology Co., 41,944,015.67 Recent financing price
Ltd. (北京绿竹生物技术股份有限公司)
Other equity instruments investment-GLOBAL HEALTH SCIENCE 222,393,107.44 Net assets
Other equity instruments investment-SCC VENTURE VI 2018-B,L.P. 6,963,959.64 Net assets
Other equity instruments investment-Nextech V Oncology S.C.S., SICAV- 32,640,308.82 Net assets
SIF
Other equity instruments investment – Others 95,622,595.29 Cost
Total 1,170,558,267.07
6. In case of transfers among levels for the current period, explain the transfer reasons and policies for
determining transfer time point for continuous fair value measurement items
□ Applicable √ N/A
7. Changes in valuation techniques for the current period and reasons for changes
□ Applicable √ N/A
8. Fair value of financial assets and liabilities not measured at fair value
□ Applicable √ N/A
9. Others
□ Applicable √ N/A
228 Joincare Pharmaceutical Group Industry Co., Ltd.
X. Related Parties and Related Party Transactions
1. Information of parent company
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Shareholding Voting right
Place of Registered ratio by parent by parent
Name of parent company registration Nature of business capital company company
(%) (%)
Shenzhen Baiyeyuan Investment Shenzhen Investment and establishment of industry, 80,000,000.00 46.83 46.83
Co., Ltd. domestic commerce, and material supply
and marketing
Notes to the parent company of the Company:
The parent company of the Company is Shenzhen Baiyeyuan Investment Co., Ltd., which was established on 21 January
1999, and its main business scope is investment and establishment of industry, domestic commerce, and material supply
and marketing.
The ultimate controller of the Company: Zhu Baoguo
Other descriptions:
(1) Registered capital of parent company and its changes
Increase for Decrease for
Name of parent company 2021.12.31 the Period the Period 2022.06.30
Shenzhen Baiyeyuan Investment Co., Ltd. 80,000,000.00 0.00 0.00 80,000,000.00
(2) Shares of the company held by the parent company and its changes
Increase for Decrease for
Name of parent company 2021.12.31 Ratio the Period the Period 2022.06.30 Ratio
Shenzhen Baiyeyuan Investment Co., Ltd. 895,653,653.00 46.95% 0.00 0.00 895,653,653.00 46.83%
2. Subsidiaries of the Company
Details of subsidiaries refer to Note
√ Applicable □ N/A
Please refer to notes VII.1. for the details of subsidiaries.
lnterim Report 2022 229
3. Joint ventures and associates of the Company
For details of the significant joint ventures or associates of the Company, please see the notes.
√ Applicable □ N/A
Details of significant joint ventures or associates refer to Note V. 11Note VII. 3.
Other joint ventures or associates entered into transactions with the Company during the period, or during the prior
period with remaining closing balance were as follows:
√ Applicable □ N/A
Name of joint ventures and associates Relationship with the Company
Jiaozuo Jinguan Jiahua Electric Power Co., Ltd. Associate
Guangdong Blue Treasure Pharmaceutical Co., Ltd. Associate
Novastage Pharmaceuticals (Shenzhen), Ltd. Associate
Shenzhen City Youbao Technology Co., Ltd. Associate
AbCyte Therapeutics Inc. Associate
L&L Biopharma, Co. Ltd. Associate
Zhuhai Sanmed Biotech Inc. Associate
Aetio Biotherapy Inc Associate
Jiangsu Atom Bioscience and Pharmaceutical Co., Ltd. Associate
Tianjin Tongrentang Group Co., Ltd. Associate
Infinite Intelligence Pharmaceutical Co. Ltd. Associate
Zhuhai Sanmed Gene Diagnostics Ltd. Entity controlled by an associate
Zhuhai Hengqin Weisheng Precision Medicine Technology Co., Ltd. Entity controlled by an associate
Other descriptions
□ Applicable √ N/A
4. Other related parties of the Company
√ Applicable □ N/A
Name of other related parties Relationship with the Company
Shenzhen Taitelixing Investment Development Co., Ltd. Others
Zhuozhou Jingnan Yongle Golf Club Co., Ltd. Others
Shenzhen Healthy Deer Information Technology Co., Ltd. Others
Sichuan Healthy Deer Hospital Management Co., Ltd. and its subsidiaries Others
Zhuhai Medpha Biotechnology Co., Ltd. Others
Zhuhai Xianghetai Investment Management Partnership (Limited Partnership) Others
Zhuhai Zhong Hui Yuan Investment Partnership (Limited Partnership) Others
Zhuhai Liying Investment Management Partnership (Limited Partnership) Others
Jiangsu Yiyingjia Medical Technology Co., Ltd. Others
Directors, Supervisors and other senior management personnel Others
230 Joincare Pharmaceutical Group Industry Co., Ltd.
5. Related party transactions
(1). Sales and purchase of goods, rendering and receipt of services
Purchase of goods, receipt of services
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Name of related parties Nature of transaction Current period Prior period
Guangdong Blue Treasure Pharmaceutical Co., Ltd. Raw materials 1,458,973.45 3,122,300.89
Sichuan Healthy Deer Hospital Management Co., Ltd. and Finished goods 0.00 12,157.00
its subsidiaries
Jiangsu Yiyingjia Medical Technology Co., Ltd. Finished goods, 368,692.00 0.00
Business promotion
Shenzhen Youbao Technology Co., Ltd. Business promotion 871,765.00 141,700.00
Zhuhai Sanmed Biotech Inc. Testing 53,443.40 0.00
L&L Biopharma, Co., Ltd. R&D 0.00 188,679.24
Beijing Infinite Intelligence Pharmaceutical Technology R&D 339,805.83 0.00
Co., Ltd.
Jiaozuo Jinguan Jiahua Electric Power Co., Ltd. Electricity, steam 129,081,366.42 103,613,339.79
Total 132,174,046.10 107,078,176.92
Sales of goods/rendering of services
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Name of related parties Nature of transaction Current period Prior period
Guangdong Blue Treasure Pharmaceutical Co. Ltd. Finished goods, water 15,282,052.21 30,514,098.48
and electricity, power
Zhuhai Sanmed Biotech Inc. Finished goods, water 194,261.12 292,011.06
and electricity, power
and others
Zhuhai Sanmed Gene Diagnostics Ltd. Finished goods, water 325,180.92 199,918.70
and electricity, power
and others
Sichuan Healthy Deer Hospital Management Co., Ltd. and Finished goods 1,987,679.87 2,697,554.00
its subsidiaries
Total 17,789,174.12 33,703,582.24
Descriptions of related party transactions with respect to the sales and purchase of goods, rendering and receipt of
services
□ Applicable √ N/A
lnterim Report 2022 231
(2). Related entrusted management/contracting and entrusting management/outsourcing
Table of the entrusted management/contracting of the Company:
□ Applicable √ N/A
Descriptions of related trusteeship/outsourcing
□ Applicable √ N/A
Table of the entrusting management/outsourcing of the Company:
□ Applicable √ N/A
Descriptions of related management/outsourcing
□ Applicable √ N/A
(3). Related party leases
The Company as a lessor
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Lease income Lease income
recognized in recognized in
Name of lessee Type of leased assets the current period prior year
Zhuhai Sanmed Biotech Inc. Buildings 1,113,149.50 1,113,149.50
Zhuhai Sanmed Gene Diagnostics Ltd. Buildings 120,000.00 120,000.00
Shenzhen Baiyeyuan Investment Co., Ltd. Buildings 9,445.88 9,445.88
Novastage Pharmaceuticals (Shenzhen) Ltd. Buildings & Equipment 468,302.76 163,189.08
Shenzhen Taitelixing Investment Development Buildings 9,360.00 9,360.00
Co., Ltd.
Shenzhen Healthy Deer Information Technology Buildings 8,587.16 8,587.16
Co., Ltd.
Shenzhen City Youbao Technology Co., Ltd. Buildings 8,587.16 8,587.16
Total 1,737,432.46 1,432,318.78
The Company as a lessee:
□ Applicable √ N/A
Descriptions of related leases
□ Applicable √ N/A
232 Joincare Pharmaceutical Group Industry Co., Ltd.
(4). Related party guarantees
The Company as the guarantor
√ Applicable □ N/A
Unit: 10,000 Yuan Currency: RMB
Actual date Guarantee Performance
Name of guaranteed party Guarantee amount of event maturity date completed or not
Jinguan Electric Power 4,000 2021/7/8 2022/7/8 No
Jinguan Electric Power 5,000 2021/7/14 2022/7/14 No
Jinguan Electric Power 3,000 2021/8/12 2022/8/12 No
Jinguan Electric Power 3,200 2021/9/23 2022/9/22 No
Jinguan Electric Power 3,200 2021/10/11 2022/10/11 No
Jinguan Electric Power 3,800 2021/10/13 2022/10/12 No
Jinguan Electric Power 3,840 2022/2/14 2022/11/30 No
Jinguan Electric Power 4,960 2022/2/24 2022/12/26 No
Jinguan Electric Power 2,000 2022/3/28 2022/12/13 No
Jinguan Electric Power 3,000 2022/6/8 2023/6/8 No
Jinguan Electric Power 3,000 2022/6/22 2023/6/22 No
The Company as the guaranteed party
□ Applicable √ N/A
Descriptions of guarantees with related parties
√ Applicable □ N/A
① In order to ensure the stable development of production and operation of Jinguan Electric Power, the Company and
its controlling subsidiary Jiaozuo Joincare jointly provided a revolving guarantee facility with balance of no more than
RMB350 million (inclusive) for Jinguan Electric Power (specific guarantors shall be specified in the guarantee contracts)
according to “the Resolution on Providing Loan Guarantee for Jinguan Electric Power by the Company and Its Controlling
Subsidiary Jiaozuo Joincare” considered and approved at the First Extraordinary General Meeting of the Company on 6
July 2016, with the guarantee period starting from the date when the resolution was considered and approved to 31
December 2019. Pursuant to “the Resolution on Providing Loan Guarantee for Jinguan Electric Power by the Company and
Its Controlling Subsidiary Jiaozuo Joincare” considered and approved at the 2017 Annual General Meeting of the Company
on 22 May 2018, the Company and its controlling subsidiary Jiaozuo Joincare jointly provided a revolving guarantee facility
with balance of no more than RMB350 million (inclusive) for Jinguan Electric Power (specific guarantors shall be specified
in the guarantee contracts), with the guarantee period starting from the date when the resolution was considered and
approved to 31 December 2022. In order to ensure the stable development of production and operation of Jinguan
Electric Power, the revolving guarantee facility with balance of no more than RMB350 million (inclusive) for Jinguan Electric
Power (specific guarantors shall be specified in the guarantee contracts) considered and approved at the 2017 General
Meeting of the Company was changed to the revolving guarantee facility with balance of no more than RMB450 million
(inclusive) on 10 May 2019 due to the actual business needs of Jinguan Electric Power, with the guarantee period starting
from the date when the resolution was considered and approved to 31 December 2022. On 18 May 2022, the “Proposal
on the Company and its subsidiary Jiaozuo Joincare in Providing Loan Guarantee for Jinguan Electric Power” was reviewed
and approved by the Company’s 2021 annual general meeting, the Company and its subsidiary Jiaozuo Joincare jointly
provided a guarantee for Jinguan Electric Power on its revolving loans facility with a balance of not more than RMB450
million (including RMB450 million) (the specific guarantor will be specified in each guarantee contract), and the term is
from the date of approval of this guarantee proposal at the Company’s annual general meeting to 31 December 2025.
lnterim Report 2022 233
As at 30 June 2022, the Company provided Jinguan Electric Power with guarantees for loans of RMB390 million; of which
RMB120 million in Shenzhen Branch of Nanyang Commercial Bank, and RMB220 million in Shenzhen Branch of China
Everbright Bank, RMB30 million in Shenzhen Branch of Zheshang Bank and RMB20 million in Jiaozuo Branch of China CITIC
Bank.
In order to ensure the safety of secured loans, Jinguan Electric Power provided counter guarantees for the said guarantees
provided by the Company and its subsidiary, Jiaozuo Joincare, based on its owned assets, and undertook that it would
unconditionally provide mutual guarantees for the Company or its controlling subsidiary designated with total facility of
no more than RMB450 million (inclusive) whenever the Company deemed necessary.
② Another shareholder of Livzon MABPharm Inc. (珠海市丽珠单抗生物技术有限公司) – the Company has issued a “Counter
Guarantee Commitment”, promising that it will share the joint and several guarantee liability to the extent of 33.07% of the
scope of guarantee responsibility in relation to the guarantee provided to Livzon MABPharm Inc. (珠海市丽珠单抗生物
技术有限公司), and the counter guarantee period will expire on the date when the Company’s guarantee responsibility
expiry.
③ Zhuhai Zhong Hui Yuan Investment Partnership (Limited Partnership) (珠海中汇源投资合伙企业(有限合伙), being
another shareholder of Livzon Group Xinbeijiang Pharmaceutical Manufacturing Inc. (丽珠集团新北江制药股份有限公司)
has issued a “Counter Guarantee Commitment”, promising that it will share the joint and several guarantee liability to the
extent of 8.44% of the scope of guarantee responsibility incurred by the Company in relation to the guarantee provided
to Livzon MABPharm Inc. (珠海市丽珠单抗生物技术有限公司), and the counter guarantee period will expire on the date
when the Company’s guarantee responsibility expiry.
(5). Lending funds of related parties
□ Applicable √ N/A
(6). Asset transfer and debt restructuring between related parties
□ Applicable √ N/A
(7). Remuneration of key management personnel
√ Applicable □ N/A
Unit: 10,000 Yuan Currency: RMB
Amount for the Amount for the
Item current period prior period
Remuneration of key management personnel 799.59 602.26
234 Joincare Pharmaceutical Group Industry Co., Ltd.
For the 6-month period ended 30 June 2022
Unit: 10,000 Yuan Currency: RMB
Director/
Supervisor Wages and Social Housing Severance
Item Allowance allowances security fund Bonus pay Others Total
Directors:
Zhu Baoguo (朱保国) 162.50 0.00 3.42 1.25 0.00 0.00 0.00 167.17
Liu Guangxia (刘广霞) 162.50 9.03 4.51 1.25 0.00 0.00 0.00 177.29
Yu Xiong (俞雄) 0.00 130.00 0.00 0.00 0.00 0.00 0.00 130.00
Qiu Qingfeng (邱庆丰) 0.00 67.50 3.60 1.25 0.00 0.00 0.00 72.36
Lin Nanqi (林楠棋) 0.00 67.50 3.60 1.25 0.00 0.00 0.00 72.36
Cui Liguo (崔利国) 5.54 0.00 0.00 0.00 0.00 0.00 0.00 5.54
Huo Jing (霍静) 5.54 0.00 0.00 0.00 0.00 0.00 0.00 5.54
Qin Yezhi (覃业志) 5.54 0.00 0.00 0.00 0.00 0.00 0.00 5.54
Peng Juan (彭娟) 5.54 0.00 0.00 0.00 0.00 0.00 0.00 5.54
Supervisors:
Yu Xiaoyun (余孝云) 2.40 19.23 3.46 1.12 0.00 0.00 0.00 26.21
Peng Jinhua (彭金花) 2.40 0.00 0.00 0.00 0.00 0.00 0.00 2.40
Xing zhiwei (幸志伟) 0.57 32.00 3.36 1.05 0.00 0.00 0.00 36.98
Xie Youguo (谢友国) (Resigned) 1.83 18.46 0.00 0.00 0.00 0.00 0.00 20.29
Other senior management:
Zhao Fenguang (赵凤光) 0.00 67.50 3.60 1.25 0.00 0.00 0.00 72.36
Total 354.37 411.23 25.55 8.44 0.00 0.00 0.00 799.59
Note: Mr. Zhu Baoguo (朱保国) serves as the chairman of Livzon, a controlled subsidiary of the Company; and Mr. Yu Xiong (俞雄) and Mr. Qiu Qingfeng (邱
庆丰) serve as non-executive directors of Livzon. The remuneration presented in above does not include the portion paid by Livzon.
lnterim Report 2022 235
For the 6-month period ended 30 June 2021
Unit: 10,000 Yuan Currency: RMB
Director/
Supervisor Wages and Social Housing Severance
Item Allowance allowances security fund Bonus pay Others Total
Directors:
Zhu Baoguo (朱保国) 106.30 0.00 2.94 1.15 0.00 0.00 0.00 110.39
Liu Guangxia (刘广霞) 106.30 0.00 2.94 1.15 0.00 0.00 0.00 110.39
Qiu Qingfeng (邱庆丰) 0.00 52.50 2.94 1.15 0.00 0.00 0.00 56.59
Lin Nanqi (林楠棋) 0.00 52.50 2.94 1.15 0.00 0.00 0.00 56.59
Cui Liguo (崔利国) 4.80 0.00 0.00 0.00 0.00 0.00 0.00 4.80
Huo Jing (霍静) 4.80 0.00 0.00 0.00 0.00 0.00 0.00 4.80
Qin Yezhi (覃业志) 4.80 0.00 0.00 0.00 0.00 0.00 0.00 4.80
Supervisors:
Yu Xiaoyun (余孝云) 1.80 19.08 2.85 1.06 0.00 0.00 0.00 24.79
Peng Jinhua (彭金花) 1.80 30.00 0.00 1.15 0.00 0.00 0.00 32.95
Xie Youguo (谢友国) 1.80 16.78 0.00 1.01 0.00 0.00 0.00 19.58
Other senior management:
Zhao Fenguang (赵凤光) 0.00 120.00 0.00 0.00 0.00 0.00 0.00 120.00
Yu Xiong (俞雄) 0.00 52.50 2.94 1.15 0.00 0.00 0.00 56.59
Total 232.40 343.36 17.54 8.97 0.00 0.00 0.00 602.26
Note: Mr. Zhu Baoguo serves as the chairman of Livzon, a controlled subsidiary of the Company; and Mr. Yu Xiong and Mr. Qiu Qingfeng serve as non-
executive directors of Livzon. The remuneration listed above does not include the part paid by Livzon.
(8). Other related transactions
□ Applicable √ N/A
236 Joincare Pharmaceutical Group Industry Co., Ltd.
6. Receivables and payables with related parties
(1). Receivables from related parties
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the End of Balance at the Beginning of
the Period the Period
Provision Provision
Item Name of related parties Book balance for bad debts Book balance for bad debts
Bills receivables Guangdong Blue Treasure Pharmaceutical Co., Ltd. 4,624,855.00 0.00 5,492,960.00 379,960.00
Accounts receivables Guangdong Blue Treasure Pharmaceutical Co., Ltd. 0.00 0.00 18,889,500.00 490,875.00
Accounts receivables Zhuhai Sanmed Gene Diagnostics Ltd. 104,854.84 1,006.66 224,023.83 8,578.07
Accounts receivables Sichuan Healthy Deer Hospital Management Co., 571,756.70 64,688.94 337,395.02 48,933.97
Ltd. and its subsidiaries
Prepayments Zhuhai Sanmed Biotech Inc. 211,200.00 0.00 211,200.00 0.00
Prepayments Shenzhen Youbao Technology Co., Ltd. 465,600.00 0.00 154,500.00 0.00
Other receivables Zhongshan Renhe Health Products Co., Ltd. 469,895.78 469,895.78 469,895.78 469,895.78
Other receivables Shenzhen Jiekang Health Care Co., Ltd. 0.00 0.00 18,577,246.63 18,577,246.63
Other receivables Shenzhen Healthy Deer Information Technology 0.00 0.00 4,680.00 74.38
Co., Ltd.
Other receivables Guangdong Blue Treasure Pharmaceutical Co., Ltd. 2,282,237.68 38,113.37 1,271,496.55 21,233.99
Other receivables Zhuhai Sanmed Biotech Inc. 58,955.40 2,847.55 0.00 0.00
Other receivables Zhuhai Sanmed Gene Diagnostics Ltd. 0.00 0.00 5,265.00 87.93
(2). Payables to related party
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item Related parties End of the Period the Period
Bills payables Guangdong Blue Treasure Pharmaceutical Co., Ltd. 21,117,677.33 379,960.00
Contract liabilities Sichuan Healthy Deer Hospital Management Co., 47,254.63 0.00
Ltd. and its subsidiaries
Accounts payables Sichuan Healthy Deer Hospital Management Co., 32,621,131.82 0.00
Ltd. and its subsidiaries
Other payables Sichuan Healthy Deer Hospital Management Co., 8,936.17 8,936.17
Ltd. and its subsidiaries
lnterim Report 2022 237
XI. Share-based Payment
1. General information about share-based payment
√ Applicable □ N/A
Unit: Share Currency: RMB
Total equity instruments granted during the Current Period by the Company 0
Total equity instruments exercised during the Current Period by the Company 4,812,759
Total equity instruments of the Company expired during the Current Period 0
Range of exercise price of share option of the Company outstanding and remaining term of Note 1
contract as at the End of the Period
Range of exercise price of other equity instruments of the Company and remaining term of –
contract as at the End of the Period
Note 1: Share Option
Other description:
① On 13 December 2018, “the Resolution on 2018 Share Options Incentive Scheme (Draft) and its summary”, “the Resolution
on Administrative Measures for Appraisal System of the 2018 Share Options Incentive Scheme of Livzon Pharmaceutical
Group Inc.” and “the Resolution on the General Meeting for Granting Mandate to the Board to Deal with Matters Regarding
the 2018 Share Options Incentive Scheme” were considered and approved at the 2018 Third Extraordinary General
Meeting. On 21 December 2018, “the Resolution in Relation to the Adjustment of the Quantity to be Granted and the
List of Incentive Participants of the Grant under 2018 Share Options Incentive Scheme” and “the Resolution on the First
Grant of Share Options to Incentive Participants” were considered and approved at the 6th Meeting of the 7th Session of
the Board and the 5th Meeting of the 7th Session of the Supervisory Committee. On 24 January 2019, “the Resolution in
Relation to the Adjustment of the Quantity to be Granted and the List of Incentive Participants of the Grant under 2018
Share Options Incentive Scheme” was considered and approved at the 7th Meeting of the 7th Session of the Board and the
6th Meeting of the 7th Session of the Supervisory Committee, pursuant to which,21 December 2018 was set as the date of
grant, on which 35.72 million share options were granted to 320 incentive participants at an exercise price of RMB8.21 per
share option.
Pursuant to “the Resolution relating to Cancellation of Certain Share Options of the Company Granted but Not Yet
Exercised under the 2018 Share Option Incentive Plan” considered and approved at the 12th Meeting of the 7th Session
of the Board of the Company on 10 June 2019, 3.95 million share options that have been granted but not yet exercised by
39 Incentive Participants who resigned due to personal reasons and did not meet the incentive conditions are canceled.
After the completion of the cancellation, the number of Incentive Participants for the first grant of the 2018 share options
incentive scheme of the Company was adjusted from 320 to 281, while the number of share options under the first grant
was adjusted from 35.72 million to 31.77 million.
Pursuant to “the Resolution relating to Cancellation of Certain Share Options of the Company Granted but Not Yet
Exercised under the 2018 Share Option Incentive Plan” considered and approved at the 17th Meeting of the 7th Session of
the Board of the Company on 28 October 2019, 2.46 million share options that have been granted but not yet exercised by
23 Incentive Participants who resigned due to personal reasons and did not meet the incentive conditions are canceled.
After the completion of the cancellation, the number of Incentive Participants for the first grant of the 2018 share options
incentive scheme of the Company was adjusted from 281 to 258, while the number of share options under the first grant
was adjusted from 31.77 million to 29.31 million.
Pursuant to “the Resolution on Fulfillment of Exercise Conditions for the First Exercise Period of the First Grant under the
2018 Share Options Incentive Scheme” considered and approved at the 19th Meeting of the 7th Session of the Board of the
Company on 4 December 2019, it was believed that the exercise conditions for the first exercise period of the first grant
under the Incentive Scheme had been achieved, and it was agreed that the 258 incentive participants who had fulfilled
the exercise conditions might exercise the share options on voluntary basis. The number of exercisable share options was
11.724 million, and the exercise period was from 21 December 2019 to 20 December 2020.
238 Joincare Pharmaceutical Group Industry Co., Ltd.
Pursuant to “the Resolution relating to Cancellation of Certain Share Options of the Company Granted but Not Yet
Exercised under the 2018 Share Option Incentive Plan” considered and approved at the 30th Meeting of the 7th Session of
the Board of the Company on 14 August 2020, 1.488 million share options that have been granted but not yet exercised
by 23 Incentive Participants under the first grant who resigned due to personal reasons and did not meet the incentive
conditions are canceled. After the completion of the cancellation, the number of Incentive Participants for the first grant
of the 2018 share options incentive scheme of the Company was adjusted from 258 to 235, while the number of share
options under the first grant was adjusted from 18,928,900 to 17,444,100.
Pursuant to “the Resolution relating to Cancellation of Certain Share Options of the Company Granted but Not Yet
Exercised under the 2018 Share Option Incentive Plan” considered and approved at the 33rd Meeting of the 7th Session
of the Board of the Company on 16 November 2020, 96,000 share options that have been granted but not yet exercised
by 2 Incentive Participants under the first grant who resigned due to personal reasons and did not meet the incentive
conditions are canceled. After the completion of the cancellation, the number of Incentive Participants for the first grant
of the 2018 share options incentive scheme of the Company was adjusted from 235 to 233, while the number of share
options under the first grant was adjusted from 16,940,000 to 16,844,400.
As at 30 June 2022, the number of share options exercised for the Period was 24,603,309 and the number of outstanding
share options was 2,368,691.
② Pursuant to “the Resolution on the Grant of Share Options to Incentive Participants under the Reserved Grant” considered
and approved at the 16th Meeting of the 7th Session of the Board of the Company on 23 September 2019, 23 September
2019 was set as the date of grant, on which 8.99 million share options were granted to 187 incentive participants at an
exercise price of RMB10.47 per share option.
Pursuant to “the Resolution in Relation to the Adjustment of the Quantity to be Granted and the List of Incentive
Participants of the Reserved Grant under 2018 Share Options Incentive Scheme” considered and approved at the 17th
Meeting of the 7th Session of the Board of the Company on 28 October 2019, the number of Incentive Participants for
the Reserved Grant of share options was adjusted from 187 to 186, while the number of share options under the Reserved
Grant was adjusted from 8.99 million to 8.97 million.
Pursuant to “the Resolution relating to Cancellation of Certain Share Options of the Company Granted but Not Yet
Exercised under the 2018 Share Option Incentive Plan” considered and approved at the 30th Meeting of the 7th Session of
the Board of the Company on 14 August 2020, 1.88 million share options that have been granted but not yet exercised by
28 Incentive Participants under the Reserved Grant who resigned due to personal reasons and did not meet the incentive
conditions are canceled. After the completion of the cancellation, the number of Incentive Participants for the Reserved
Grant of the 2018 Share Options Incentive Scheme of the Company was adjusted from 186 to 158, while the number of
share options under the Reserved Grant was adjusted from 8.97 million to 7.09 million.
Pursuant to “the Resolution on Fulfillment of Exercise Conditions for the First Exercise Period of the Reserved Grant under
the 2018 Share Options Incentive Scheme” considered and approved at the 31st Meeting of the 7th Session of the Board of
the Company on 27 August 2020, it was believed that the exercise conditions for the first exercise period of the reserved
grant under the Incentive Scheme had been achieved, and it was agreed that the incentive participants who had fulfilled
the exercise conditions might exercise the share options on voluntary basis. The number of exercisable share options was
3,545,000, and the exercise period was from 23 September 2020 to 22 September 2021.
Pursuant to “the Resolution relating to Cancellation of Certain Share Options of the Company Granted but Not Yet
Exercised under the 2018 Share Option Incentive Plan” considered and approved at the 33rd Meeting of the 7th Session of
the Board of the Company on 16 November 2020, 450,000 share options that have been granted but not yet exercised by
8 Incentive Participants under the Reserved Grant who resigned due to personal reasons and did not meet the incentive
conditions are canceled. After the completion of the cancellation, the number of Incentive Participants for the reserved
grant of the 2018 share options incentive scheme of the Company was adjusted from 158 to 150, while the number of
share options under the reserved grant was adjusted from 4,616,500 to 4,166,500.
As at 30 June 2022, the number of share options exercised for the Period was 5,039,316 and the number of outstanding
share options was 1,440,684.
lnterim Report 2022 239
(2) Livzon Group, a subsidiary of the Company
Total equity instruments granted during the Current Period by the Company (share) –
Total equity instruments exercised during the Current Period by the Company (share) 496,836
Total equity instruments of the Company expired during the Current Period (share) –
Range of exercise price of share option of the Company outstanding and remaining term of Note 1
contract as at the end of the Period
Range of exercise price of other equity instruments of the Company and remaining term of Note 2
contract as at the end of the Period
Note 1: Share Option
① On 5 September 2018, “the Resolution on 2018 Share Options Incentive Scheme (Revised Draft) and its summary”, the
“Resolution on Administrative Measures for Appraisal System of the 2018 Share Options Incentive Scheme of Livzon
Pharmaceutical Group Inc.” and “the Resolution on the General Meeting For Granting Mandate to the Board to Deal
with Matters Regarding the 2018 Share Options Incentive Scheme” were considered and approved at the 2018 Third
Extraordinary General Meeting, the 2018 Third Class Meeting of A Shareholders and the 2018 Third Class Meeting of H
Shareholders of Livzon Group. Pursuant to “the Resolution in Relation to the Adjustment of the List of Incentive Participants
of the First Grant and the Quantity to be Granted for the First Grant under 2018 Share Options Incentive Scheme” and “the
Resolution on the Related Matters of the First Grant of 2018 Share Options Incentive Scheme” considered and approved at
the 19th Meeting of the 9th Session of the Board of Livzon Group on 11 September 2018, 11 September 2018 was set as
the date of grant, on which 17,475,500 Share Options were granted to 1,050 Incentive Participants at an exercise price of
RMB47.01 per share option.
Pursuant to “the Resolution relating to Cancellation of Certain Share Options under the 2018 Share Option Incentive
Plan” considered and approved at the 32nd Meeting of the 9th Session of the Board of Livzon Group on 18 September
2019, 254,995 share options that have been granted but not yet exercised by 17 Incentive Participants who resigned due
to personal reasons and did not meet the incentive conditions are canceled. After the completion of the cancellation,
the number of Incentive Participants for the first grant of the 2018 share options incentive scheme of Livzon Group was
adjusted from 1,050 to 1,033, while the number of share options under the first grant was adjusted from 22,718,150 to
22,463,155.
Pursuant to “the Resolution relating to Cancellation of Certain Share Options under the 2018 Share Option Incentive
Plan” considered and approved at the 4th Meeting of the 10th Session of the Board of Livzon Group on 23 October 2020,
162,912 share options under the first exercise period held but not yet exercised by 55 Incentive Participants and 1,535,765
share options granted and no longer meeting the exercising conditions to 129 Incentive Participants who had resigned
due to personal reasons and were therefore no longer qualified for the incentive are canceled. After the completion of
the cancellation, the number of Incentive Participants for the first grant of the 2018 Share Options Incentive Scheme of
Livzon Group was adjusted from 1,033 to 904, while the number of share options under the first grant was adjusted from
22,463,155 to 20,764,478.
Pursuant to “Resolution relating to Cancellation of Certain Share Options under the 2018 Share Option Incentive Plan”
considered and approved at the the 25th meeting of the tenth session of the Board of Livzon Group on 10 November
2021, 323,274 share options under the second exercise period held but not yet exercised by 80 Incentive Participants and
673,422 share options granted and no longer meeting the exercising conditions to 107 Incentive Participants who were
no longer qualified for the incentive are cancelled. After the completion of the cancellation, the number of Incentive
Participants for the first grant of the 2018 Share Options Incentive Scheme of the Company was adjusted from 904 to 797,
while the number of share options under the first grant was adjusted from 20,764,478 to 19,767,782.
As at 30 June 2022, the number of outstanding share options was 4,885,030.
240 Joincare Pharmaceutical Group Industry Co., Ltd.
② Pursuant to “the Resolution relating to Relevant Issues concerning the Reserved Grant under the 2018 Share Options
Incentive Scheme” considered and approved at the 31st Meeting of the 9th Session of the Board of Livzon Group on 28
August 2019, the Board approved 28 August 2019 as the date of grant, on which 2,535,000 share options were granted to
145 Incentive Participants and the exercise price was RMB28.87 per A share.
Pursuant to “the Resolution relating to Adjusting the List of Incentive Participants under the Reserved Grant of the 2018
Share Options Incentive Scheme” considered and approved at the 32nd Meeting of the 9th Session of the Board of Livzon
Group on 18 September 2019, the number of Incentive Participants under the reserved grant of the share option incentive
plan was adjusted from 145 to 170.
On 28 October 2019, the Reserved Grant of the share options has completed registration. During the process of
registration, 1 Incentive Participant was no longer qualified for incentive due to his resignation, and 2 Incentive Participants
voluntarily gave up the Share Options to be granted by Livzon Group due to personal reasons. Therefore, the number of
Incentive Participants under the Reserved Grant is adjusted from 170 to 167, and the total number of Share Options under
the Reserved Grant is adjusted from 2,535,000 to 2,524,500.
Pursuant to “the Resolution relating to Cancellation of Certain Share Options under the 2018 Share Option Incentive
Plan” considered and approved at the 4th Meeting of the 10th Session of the Board of Livzon Group on 23 October
2020, 309,900 share options granted and no longer meeting the exercising conditions to 10 incentive participants who
had resigned due to personal reasons and were therefore no longer qualified for the incentive are canceled. After the
completion of the cancellation, the number of Incentive Participants under the Reserved Grant of the 2018 Share Options
Incentive Scheme of Livzon Group was adjusted from 167 to 157, while the number of share options under the Reserved
Grant was adjusted from 2,524,500 to 2,214,600.
Pursuant to “Resolution relating to Cancellation of Certain Share Options under the 2018 Share Option Incentive Plan”
considered and approved at the the 25th meeting of the tenth session of the Board of Livzon Group on 10 November
2021, 31,150 share options under the first exercise period held but not yet exercised by 7 Incentive Participants and
129,400 share options granted and no longer meeting the exercising conditions to 18 incentive participants who were
no longer qualified for the incentive are cancelled. After the completion of the cancellation, the number of Incentive
Participants under the Reserved Grant of the 2018 Share Options Incentive Scheme of the Company was adjusted from 157
to 139, while the number of share options under the Reserved Grant was adjusted from 2,214,600 to 2,054,050.
As at 30 June 2022, the number of outstanding share options was 614,199.
Note 2: Other equity incentive
Pursuant to “the Resolution on the Disposal of Certain Equity of a Holding Subsidiary and Connected Transaction”
considered and approved at the 34th Meeting of the 9th Session of the Board of Livzon Group on 8 November 2019, it was
agreed that 9.5% equity interests (totally 8,382,100 shares) in Zhuhai Livzon Diagnostics Inc. (珠海丽珠试剂股份有限公司)
held by Livzon Group shall be transferred to Zhuhai Liying Investment Management Partnership (Limited Partnership) (珠
海丽英投资管理合伙企业(有限合伙)) at the consideration of RMB21,122,892. Pursuant to the Assets Appraisal Report on
the Valuation of the Shareholders’ Equity as a Whole of Zhuhai Livzon Diagnostics Inc. in Relation to the Proposed Equity
Transfer by Livzon Pharmaceutical Group Inc. (Huaya Zhengxin Appraisal Report [2019] No. A02-0011), the valuation of
the shareholders’ equity as a whole of Zhuhai Livzon Diagnostics Inc. as at 30 June 2019 was RMB647.3075 million, and
the above equity transfer price was lower than its fair value, therefore it constitutes a share-based payment. The total
share-based payment of the transaction is RMB40.4017 million, which should be amortized within 5 years according to
the partnership agreement and share incentive expenses were recognised due to the share-based payment as a result
of the change in the shareholding of the shareholders of Zhuhai Liying Investment Management Partnership (Limited
Partnership).
lnterim Report 2022 241
Pursuant to “the Resolution on the Implementation of Employee Equity Incentive Scheme by a Holding Subsidiary”
considered and approved at the 34th Meeting of the 9th Session of the Board of Livzon Group on 8 November 2019, the
total number of shares of new issuance by Zhuhai Livzon Diagnostics Inc. for implementation of employee equity incentive
scheme shall not be more than 4,643,839 shares, and the scheme participants shall contribute a total of RMB11,702,474.28
to directly subscribe for the above shares or indirectly subscribe for the such shares through the holding of the limited
partnership shares of the employee shareholding platform. In December 2019, pursuant to the Capital Increase Agreement
of Zhuhai Livzon Diagnostics Inc., the total shares of Zhuhai Livzon Diagnostics Inc. increased from 88,232,932 shares
to 92,876,771 shares with par value of RMB1 per share. The increased number of shares were subscribed for by Zhuhai
Haoxun Enterprise Management Consulting Partnership (Limited Partnership) (珠海豪汛企业管理咨询合伙企业(有限
合伙)), Zhuhai Yichen Enterprise Management Consulting Partnership (Limited Partnership) (珠海熠臣企业管理咨询合
伙企业(有限合伙)) and Zhuhai Qijing Enterprise Management Consulting Partnership (Limited Partnership) (海启靖企
业管理咨询合伙企业(有限合伙)) at the consideration of RMB11,702,474. The subscription price is lower than the fair
value, therefore it constitutes a share-based payment. The total share-based payment of the transaction is RMB20,709,000,
which should be amortized within 5 years according to the Partnership Agreement, and share incentive expenses were
recognized due to the share-based payment as a result of the change in the shares/shareholding of the shareholders of
Zhuhai Livzon Diagnostics Inc.
On 31 August 2021, the general meeting of LivzonBio considered and approved the Equity Incentive Scheme of Zhuhai
Livzon Biotechnology Co., Ltd. (珠海市丽珠生物医药科技有限公司), granting 66,666,667 restricted shares of Livzon
Biologics to incentive participants, among which 42 million shares were granted in the first batch and 24,666,667 shares
were reserved. Incentive participants indirectly subscribed for the above shares through the holding of the limited
partnership shares of the employee shareholding platform. The subscription price is lower than the fair value, therefore it
constitutes a share-based payment. The total share-based payment of the transaction is RMB33.6 million, which should be
amortized during the lock-up period according to the Equity Incentive Scheme of LivzonBio and the Grant Agreement and
RMB9,800,000 was amortized in the 6-month period ended 30 June 2022.
2. Equity settled share-based payments
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Black-Scholes Model,
Method in determining the fair value of equity instruments at the date of grant market price
Basis for determining quantity of exercisable equity instruments –
Reasons for significant discrepancies between estimate for the Period and Previous Period None
Accumulated amount of equity settled share-based payments included in capital reserve 174,837,926.50
Total expense recognised for equity settled share-based payments for the Period 20,288,460.09
3. Cash settled share-based payments
□ Applicable √ N/A
242 Joincare Pharmaceutical Group Industry Co., Ltd.
XII. Commitments and Contingencies
1. Significant commitments
√ Applicable □ N/A
Significant commitments to outsiders as of the balance sheet data, and their nature and amount
(1) Capital commitments
Capital commitments entered into but not recognized in the financial
statements Closing balance Beginning balance
Commitments in relation to acquisition of long-term assets 623,138,265.76 582,336,168.87
Commitments in relation to external investment 8,000,000.00 8,000,000.00
Commitments in relation to research and development expenditures 285,490,623.32 309,313,880.64
(2) Other commitments
None.
(3) Performance of previous commitments
The Company has duly performed the capital expenditure commitments and the operating lease commitments and the
other commitments as at 30 June 2022.
2. Contingencies
(1). Significant contingencies as of the balance sheet date
□ Applicable √ N/A
(2) .Please also make explanations thereof if the Company has no significant contingency to be disclosed:
√ Applicable □ N/A
Except for the guarantee with related parties mentioned in Note X. 5. (4). As at 30 June 2022, there were no significant
contingencies required to be disclosed by the Company.
3. Others
□ Applicable √ N/A
lnterim Report 2022 243
XIII. Events after the Balance Sheet Date
1. Significant non-adjustment events
□ Applicable √ N/A
2. Profit distribution
□ Applicable √ N/A
3. Sales returns
□ Applicable √ N/A
4. Descriptions of other events after the balance sheet date
√ Applicable □ N/A
(1) Share repurchase
On 23 December 2021, the Company’s 5th Extraordinary General Meeting of Shareholders of 2021 reviewed and approved
the “Plan on Repurchasing the Company’s Shares by Centralized Bidding Transactions”, and plans to repurchase shares
through centralized bidding transactions in the Shanghai Stock Exchange trading system, the total amount of funds
for repurchase shares shall not be less than RMB300 million (inclusive) and not more than RMB600 million (inclusive),
and the repurchase price shall not exceed RMB15 per share (inclusive). The repurchased shares will be used to reduce
the Company’s registered capital, and the source of repurchase fund are self-funding or self-financing by the Company.
The repurchase period is no more than 12 months from the date when the Company’s general meeting of shareholders
considers and approves the repurchase plan, that is, from 23 December 2021 to 22 December 2022.
As of 7 July 2022, the Company repurchased a total of 50,959,668 shares and paid a total of RMB599,981,715.83 (including
transaction fees), and de-registration was completed on 11 July 2022.
(2) Issue GDR in the SIX Swiss Exchange
The Company held the 13th meeting of the 8th session of the Board of Directors on 22 June 2022, at which it reviewed
and approved the “Proposal on the Company’s Issuance of GDR, Listing on the SIX Swiss Exchange and Conversion to
Joint Stock Company Floatation and Listing Abroad”, the Company is planning for overseas issuance of Global Depository
Receipts (“GDR”) and applying for listing on the SIX Swiss Exchange. GDR is the newly issued A shares of the Company’s
RMB ordinary shares as the underlying securities. This proposal still needs to be submitted to the shareholders general
meeting for approval.
As of 10 August 2022, the Company has no other events that needed to be disclosed after the balance sheet date.
(3) Stock option incentive
The company held the 15th meeting of the 8th session of the Board of Directors on 10 August 2022, at which it reviewed
and passed the “Proposal on the Company’s 2022 Stock Option Incentive Plan(Draft) and its Abstract” which is still to be
submitted to the general meeting of shareholders of the company for deliberation.
244 Joincare Pharmaceutical Group Industry Co., Ltd.
XIV. Other significant events
1. Other significant events
√ Applicable □ N/A
(1). Important supplier
Jiaozuo Xincheng Huai Medicine Co., Ltd. (hereinafter referred to as “Xincheng Company”) is a supplier of Chinese herbs
of the Company. The Company purchased Chinese herbs of RMB11.39 million (tax inclusive) from Xincheng Company
during the 6-month period ended 30 June 2022, accounting for 95.77% of the total amount of purchases of Chinese herbs
(excluding Livzon Group). Xincheng Company delivered commodities to the Company according to the Purchase Contract
of the Company and issued VAT special invoices after acceptance by the Company. As at 30 June 2022, the balance of
prepayment of the Company to Xincheng Company was RMB13,155,269.50.
(2) Leases
The Company had adopted a simplified approach for short-term leases and leases of low value assets and did not
recognized right-of-use assets and lease liabilities. The expense of short-term leases, leases of low value assets and variable
lease payments not included in the measurement of lease liabilities are included in the expenses in the current period as
follows:
Item Amount for the Period
Short-term leases 2,392,763.95
Leases of low value assets 0.00
Total 2,392,763.95
As at 30 June 2022, save as the disclosed above, there were no other significant matters required to be disclosed by the
Company.
XV.Notes to the Key Components of Financial Statements item of the Parent
Company
1. Notes receivables
Balance at the End of the Period Balance at the Beginning of the Period
Provision for Provision for
Category Book balance bad debts Carrying value Book balance bad debts Carrying value
Bank acceptance bills 234,490,808.52 0.00 234,490,808.52 374,296,302.21 0.00 374,296,302.21
Commercial acceptance bill 0.00 0.00 0.00 0.00 0.00 0.00
Total 234,490,808.52 0.00 234,490,808.52 374,296,302.21 0.00 374,296,302.21
(1) Notes receivable pledged at the end of the period
Amount pledged at the
Category End of the Period
Bank acceptance bills 126,859,793.46
(2) Notes receivable endorsed or discounted to other parties but not yet expired at balance sheet date
Amount Amount not
derecognised at derecognised at
the End of the End of
Category the Period the Period
Bank acceptance bills not yet mature but already endorsed 11,214,600.10
Bank acceptance bills not yet mature but already discounted 154,026,768.58
Total 165,241,368.68
lnterim Report 2022 245
(3) There were no bills transferred into accounts receivables for non-performance by the issuer at the End of the Period.
(4) Classification by the method of bad debt provision
Balance at the End of the Period Balance at the Beginning of the Period
Provision for Provision for Provision for
Book balance bad debts Book balance bad debts Book balance bad debts
Category Amount Percentage Amount Percentage Amount Amount Percentage Amount Percentage Carrying value
(%) (%) (%) (%)
Provision for bad debt on an individual basis
Provision for bad debt on a collective basis 234,490,808.52 100.00 0.00 0.00 234,490,808.52 374,296,302.21 100.00 0.00 0.00 374,296,302.21
Including:
Bank acceptance bills 234,490,808.52 100.00 0.00 0.00 234,490,808.52 374,296,302.21 100.00 0.00 0.00 374,296,302.21
Total 234,490,808.52 100.00 0.00 0.00 234,490,808.52 374,296,302.21 100.00 0.00 0.00 374,296,302.21
(5) Provision for bad debt made, recovered or reversed during the Period
None
(6) There are no bills receivables actually written-off for the Period.
2. Accounts receivables
(1). Disclosure using the aging analysis method
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Aging End of the Period
Within 1 year 354,284,687.76
1-2 years 2,155,591.77
2-3 years 335,434.36
3-4 years 520,033.44
4-5 years 383,816.50
Over 5 years 7,902,586.13
Total 365,582,149.96
246 Joincare Pharmaceutical Group Industry Co., Ltd.
(2). Classification by the method of bad debt provision
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the End of the Period Balance at the Beginning of the Period
Provision for Provision for
Book balance bad debts Book balance bad debts
Expected Expected
credit loss credit loss
Category Amount Percentage Amount rate Carrying value Amount Percentage Amount rate Carrying value
(%) (%) (%) (%)
Provision for bad debts on individual basis 771,300.68 0.21 771,300.68 100.00 0.00 771,300.68 0.14 771,300.68 100.00 0.00
Including:
Receivables from domestic customers 771,300.68 0.21 771,300.68 100.00 0.00 771,300.68 0.14 771,300.68 100.00 0.00
Receivables from overseas customers 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Provision for bad debts on portfolio basis 364,810,849.28 99.79 11,676,640.80 3.20 353,134,208.48 548,813,091.14 99.86 13,270,020.90 2.42 535,543,070.24
Including:
Receivables from domestic customers 364,810,849.28 99.79 11,676,640.80 3.20 353,134,208.48 548,813,091.14 99.86 13,270,020.90 2.42 535,543,070.24
Receivables from overseas customers 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Total 365,582,149.96 100.00 12,447,941.48 3.40 353,134,208.48 549,584,391.82 100 14,041,321.58 2.55 535,543,070.24
Provision for bad debts on individual item:
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the End of the Period
Provision Expected credit Reason for
Name Book balance for bad debts loss rate provision made
(%)
Purchase of goods 771,300.68 771,300.68 100.00 Not expected to be
recoverable
Total 771,300.68 771,300.68 100.00 /
Statements of provision for bad debt on individual basis:
□ Applicable √ N/A
Provision for bad debts on portfolio basis:
√ Applicable □ N/A
Item on portfolio basis: Due from domestic customers
Unit: Yuan Currency: RMB
Balance at the End of the Period
Accounts Provision for
Aging receivables bad debts Carrying Value
(%)
Within 1 year 354,284,687.76 3,435,867.57 0.97
1-2 years (inclusive of 2 years) 2,155,591.77 217,779.59 10.10
2-3 years (inclusive of 3 years) 335,434.36 114,630.31 34.17
3-4 years (inclusive of 4 years) 520,033.44 400,016.72 76.92
4-5 years (inclusive of 5 years) 38,776.70 32,021.36 82.58
Over 5 years 7,476,325.25 7,476,325.25 100.00
Total 364,810,849.28 11,676,640.80 3.20
lnterim Report 2022 247
Standards of provision for bad debts made by portfolio and descriptions thereof:
□ Applicable √ N/A
If the provision for bad debts is made in accordance with the general model of expected credit losses, please refer to other
receivables disclosure:
□ Applicable √ N/A
(3). Provision for bad debts
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the Changes for the current period Balance at
Beginning of Recovery Removal/ Other the End of
Item the Period Provision or reversal write-off changes the Period
Accounts receivables 14,041,321.58 -1,593,380.10 0.00 0.00 0.00 12,447,941.48
Total 14,041,321.58 -1,593,380.10 0.00 0.00 0.00 12,447,941.48
As at 30 June 2022 and 31 December 2021, the Company had no accounts receivables that are past due but not impaired.
Significant recovery or reversal of bad debt provision for the current period:
□ Applicable √ N/A
(4). Accounts receivable actually written off for the current period
□ Applicable √ N/A
(5). The top five balances of accounts receivable by debtors as at the End of the Period
√ Applicable □ N/A
As of 30 June 2022, the total amount of the top five debtors in closing balance is RMB43,228,720.97, accounting for 11.82%
of the total amount of closing balance of accounts receivable, and the corresponding closing balance of provision for bad
debts is total RMB432,287.21.
(6). Derecognised accounts receivables in the Company due to the transfer of financial assets.
□ Applicable √ N/A
(7). Amount of assets or liabilities for which accounts receivable have been transferred but involvement continues in the
Company.
□ Applicable √ N/A
Other descriptions:
□ Applicable √ N/A
248 Joincare Pharmaceutical Group Industry Co., Ltd.
3. Other receivables
Line items
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item End of the Period the Period
Dividends receivable 769,999,500.00 814,041,000.00
Other receivables 323,802,318.49 322,196,811.25
Total 1,093,801,818.49 1,136,237,811.25
Other descriptions:
□ Applicable √ N/A
(1). Dividends receivable
Dividends receivable
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item End of the Period the Period
Topsino 749,999,500.00 749,999,500.00
Haibin Pharma 0.00 44,041,500.00
Fenglei Electric Power 20,000,000.00 20,000,000.00
Provision for bad debts 0.00 0.00
Total 769,999,500.00 814,041,000.00
Other receivables
(1) .Disclosure by aging
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Aging End of the Period
Subtotal within 1 year 323,737,556.35
1-2 years 247,451.44
2-3 years 149,386.44
3-4 years 146,228.36
4-5 years 0.00
Over 5 years 19,105,586.00
Provision for bad debts -19,583,890.10
Total 323,802,318.49
lnterim Report 2022 249
(2) .Disclosure by nature of the amount
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the
Balance at the Beginning of
Item End of the Period the Period
Other receivables of each company within the scope of combination 322,930,996.47 294,833,504.86
Capital reduction 0.00 24,078,925.22
Treasury bonds and security deposits 17,968,386.04 17,968,386.04
External entities balances 1,656,243.34 3,763,793.73
Security deposits 830,582.74 848,272.56
Others 0.00 50,500.11
Total 343,386,208.59 341,543,382.52
(3) .Provision made for bad debts
√ Applicable □ N/A
As at the End of the Period, provision for bad debts in first stage:
Expected credit
losses rate
over the next Provision
Category Book balance 12 months for bad debts Carrying value Reason
(%)
Provision for bad debt on 0.00 0.00 0.00 0.00
individual item
Capital reduction 0.00 0.00 0.00 0.00
Provision for bad debt on 322,930,996.47 0.00 0.00 322,930,996.47
portfolio basis
Other receivables of each 322,930,996.47 0.00 0.00 322,930,996.47 Expected to be
company within the scope of recovered
combination
Total 322,930,996.47 0.00 0.00 322,930,996.47
As at the End of the Period, provision for bad debts in second stage:
Expected credit
losses rate
over the Provision
Category Book balance lifetime for bad debts Carrying value Reason
(%)
Provision for bad debt on
individual item
Provision for bad debt on 2,486,826.08 64.96 1,615,504.06 871,322.02
portfolio basis
Receivables of security deposits 830,582.74 18.94 157,320.34 673,262.40
Other receivables 1,656,243.34 88.04 1,458,183.72 198,059.62
Total 2,486,826.08 64.96 1,615,504.06 871,322.02
250 Joincare Pharmaceutical Group Industry Co., Ltd.
As at the End of the Period, provision for bad debts in third stage:
Expected credit
losses rate
over the Provision
Category Book balance lifetime for bad debts Carrying value Reason
(%)
Provision for bad debt on 17,968,386.04 100.00 17,968,386.04 0.00
individual item
National debt and Margin 17,968,386.04 100.00 17,968,386.04 0.00 Not expected to
be recoverable
Provision for bad debt on 0.00 0.00 0.00 0.00
portfolio basis
Total 17,968,386.04 100.00 17,968,386.04 0.00
As at 31 December 2021, provision made for bad debts:
As at 31 December 2021, provision for bad debts in first stage:
Expected credit
losses rate
over the next Provision
Category Book balance 12 months for bad debts Carrying value Reason
(%)
Provision for bad debt on 24,078,925.22 0.00 0.00 24,078,925.22
individual item
Capital reduction 24,078,925.22 0.00 0.00 24,078,925.22 Expected to be
recovered
Provision for bad debt on 294,833,504.86 0.00 0.00 294,833,504.86
portfolio basis
Other receivables of each 294,833,504.86 0.00 0.00 294,833,504.86 Expected to be
company within the scope of recovered
combination
Total 318,912,430.08 0.00 0.00 318,912,430.08
As at 31 December 2021, provision for bad debts in second stage:
Expected credit
losses rate
over the Provision
Category Book balance lifetime for bad debts Carrying value Reason
(%)
Provision for bad debt on an 0.00 0.00 0.00 0.00
individual basis
Provision for bad debt on a 4,662,566.40 29.56 1,378,185.23 3,284,381.17
collective basis
Receivable deposits and 877,102.56 17.99 157,778.54 719,324.02
deposits and rental fees
Other receivables 3,785,463.84 32.24 1,220,406.69 2,565,057.15
Total 4,662,566.40 29.56 1,378,185.23 3,284,381.17
lnterim Report 2022 251
As at 31 December 2021, provision for bad debts in the third stage:
Expected credit
losses rate
over the Provision
Category Book balance lifetime for bad debts Carrying value Reason
(%)
Provision for bad debt on an 17,968,386.04 100.00 17,968,386.04 0.00
individual basis
Treasury bonds and Margin 17,968,386.04 100.00 17,968,386.04 0.00 Not expected to
be recoverable
Provision for bad debt on a 0.00 0.00 0.00 0.00 -
collective basis
Total 17,968,386.04 100.00 17,968,386.04 0.00
(4) Provision for bad debts made, recovered or reversed during the Period
Unit: Yuan Currency: RMB
First stage Second stage Third stage
Expected credit Expected credit
losses over the losses over the
Expected credit lifetime (without lifetime (with
losses over the impairment of impairment of
Provision for bad debts next 12 months credit) credit) Total
Balance at the Beginning of the 0.00 1,378,185.23 17,968,386.04 19,346,571.27
Period
Movement of beginning balance
during the period
– Transferred to Second stage 0.00 0.00 0.00 0.00
– Transferred to third stage 0.00 0.00 0.00 0.00
– Reversed to second stage 0.00 0.00 0.00 0.00
– Reversed to first stage 0.00 0.00 0.00 0.00
Provisions made for the Period 0.00 237,318.83 -158,470.77 78,848.06
Reversals for the Period 0.00 0.00 0.00 0.00
Write-off for the Period 0.00 0.00 0.00 0.00
Settlement for the Period 0.00 0.00 -158,470.77 -158,470.77
Other changes 0.00 0.00 0.00 0.00
Balance at the End of the Period 0.00 1,615,504.06 17,968,386.04 19,583,890.10
Descriptions of the significant changes in the gross carrying amount of other receivables for which the changes in loss
allowance occur for the current period:
□ Applicable √ N/A
Provision for bad debts in the current period and the basis for assessing whether the credit risk of financial instruments
have increased significantly:
□ Applicable √ N/A
(5). Actual written-off of other receivables at the End of the Period
□ Applicable √ N/A
252 Joincare Pharmaceutical Group Industry Co., Ltd.
(6) Other receivables due from the top five debtors at the End of the Period
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Proportion to
total other Balance of
receivables at provision for bad
Balance at the the End of debts at the End of
Name of entity Nature of receivables End of the Period Aging the Period the Period
(%)
Shenzhen Fenglei Electric Other receivables of each 129,956,104.29 Within one year 37.85 0.00
Power Investment Co., Ltd. company within the
scope of combination
Joincare Haibin Pharmaceutical Other receivables of each 125,587,663.86 Within one year 36.57 0.00
Co., Ltd. company within the
scope of combination
Topsino Industries Limited Other receivables of each 36,963,997.56 Within one year 10.76 0.00
company within the
scope of combination
Huaxia Securities Co., Ltd Treasury bonds and 17,968,386.04 Over 5 years 5.23 17,968,386.04
security deposits
Guangzhou Joincare Respiratory Other receivables of each 16,177,205.99 Within one year 4.71 0.00
Medicine Engineering company within the
Technology Co., Ltd. scope of combination
Total / 326,653,357.74 / 95.12 17,968,386.04
(7). Other receivables derecognised due to the transfer of financial assets
□ Applicable √ N/A
(8). Assets and liabilities generated by the transfer of other receivables and continuing involvement therein
□ Applicable √ N/A
Other descriptions:
□ Applicable √ N/A
4. Long-term equity investments
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance at the End of the Period Balance at the Beginning of the Period
Provision for Provision for
Item Book balance impairment Carrying value Book balance impairment Carrying value
Investments in subsidiaries 3,453,138,312.11 7,010,047.91 3,446,128,264.20 3,453,138,312.11 7,010,047.91 3,446,128,264.20
Investments in associates and 67,306,382.27 0.00 67,306,382.27 84,810,888.09 0.00 84,810,888.09
joint ventures
Total 3,520,444,694.38 7,010,047.91 3,513,434,646.47 3,537,949,200.20 7,010,047.91 3,530,939,152.29
lnterim Report 2022 253
(1). Investments in subsidiaries
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Balance of
provision for
Balance at Increase Decrease Balance at Provision for impairment
the Beginning during the during the the End of impairment at the End of
Investee of the Year Period Period the Period for the Period the Period
Livzon 608,741,654.08 0.00 0.00 608,741,654.08 0.00 0.00
Haibin Pharma 783,054,186.38 0.00 0.00 783,054,186.38 0.00 0.00
Joincare Daily-Use 24,116,498.56 0.00 0.00 24,116,498.56 0.00 1,610,047.91
Topsino 813,552,689.31 0.00 0.00 813,552,689.31 0.00 0.00
Taitai Genomics 37,500,000.00 0.00 0.00 37,500,000.00 0.00 0.00
Taitai Pharmaceutical 105,939,709.72 0.00 0.00 105,939,709.72 0.00 0.00
Shenzhen Hiyeah 170,100,000.00 0.00 0.00 170,100,000.00 0.00 5,400,000.00
Fenglei Electric Power 100,763,433.06 0.00 0.00 100,763,433.06 0.00 0.00
Jiaozuo Joincare 375,000,000.00 0.00 0.00 375,000,000.00 0.00 0.00
Shanghai Frontier 32,500,000.00 0.00 0.00 32,500,000.00 0.00 0.00
Taitai Biological 4,832,950.00 0.00 0.00 4,832,950.00 0.00 0.00
Joincare Haibin 100,000,000.00 0.00 0.00 100,000,000.00 0.00 0.00
Joincare Special medicine Food 3,000,000.00 0.00 0.00 3,000,000.00 0.00 0.00
Livzon Biotechnology * 294,037,191.00 0.00 0.00 294,037,191.00 0.00 0.00
Total 3,453,138,312.11 0.00 0.00 3,453,138,312.11 0.00 7,010,047.91
(2). Investment in associates and joint ventures
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Change during the Period Balance of
provision
Investment Adjustment Cash for
Balance profit and in other dividend impairment
at the loss under com- Other or profit Balance at the End
Beginning Increased Decreased the equity prehensive equity distribution Provision for at the End of of the
Investee of the Year investment investment method income changes declared Impairment Others the Period Period
II Associates
Ningbo Ningrong Biological Medicine Co., 27,464,098.71 0.00 0.00 -203,057.33 0.00 0.00 0.00 0.00 0.00 27,261,041.38 0.00
Ltd.
Feellife Health Inc. 10,689,582.15 0.00 0.00 499,401.08 0.00 0.00 0.00 0.00 0.00 11,188,983.23 0.00
Novastage Pharmaceuticals (Shenzhen), Ltd. 18,080,883.21 0.00 18,080,883.21 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Jiangsu Baining Yingchuang Medical 28,576,324.02 0.00 0.00 280,033.64 0.00 0.00 0.00 0.00 0.00 28,856,357.66 0.00
Technology Co., Ltd
Total 84,810,888.09 0.00 18,080,883.21 576,377.39 0.00 0.00 0.00 0.00 0.00 67,306,382.27 0.00
254 Joincare Pharmaceutical Group Industry Co., Ltd.
5. Operating income and operating cost
Operating income and operating cost
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the Period For the Previous Period
Item Cost Income Cost Income
Principal activities 1,169,331,881.23 785,770,845.75 759,577,957.14 459,140,124.45
Other activities 7,768,255.94 3,116,156.20 8,294,340.88 2,648,591.72
Total 1,177,100,137.17 788,887,001.95 767,872,298.02 461,788,716.17
Other descriptions:
(2). Descriptions of operating income
① Operating income and operating cost presented by product types
For the Period For the Previous Period
Item Cost Income Income Cost
Chemical pharmaceuticals 1,091,103,688.17 735,913,959.70 674,814,842.94 406,252,524.34
Health care products 54,408,929.55 35,996,134.48 62,009,176.42 39,684,403.79
Traditional Chinese medicine 23,819,263.50 13,860,751.57 22,753,937.78 13,203,196.32
Total 1,169,331,881.23 785,770,845.75 759,577,957.14 459,140,124.45
② Operating income and operating cost presented by major operating regions
For the Period For the Previous Period
Item Cost Income Cost Income
Domestic 1,169,331,881.23 785,770,845.75 759,577,957.14 459,140,124.45
Total 1,169,331,881.23 785,770,845.75 759,577,957.14 459,140,124.45
③ Operating income and operating cost presented by time of income recognition
For the Period For the Previous Period
Item Income Cost Income Cost
Commodities (transferred at a point 1,169,331,881.23 785,770,845.75 759,577,957.14 459,140,124.45
in time)
Total 1,169,331,881.23 785,770,845.75 759,577,957.14 459,140,124.45
(3) Descriptions of other activities
For the Period For the Previous Period
Item Income Cost Income Cost
Rental fees 5,325,285.20 781,055.72 6,705,251.57 1,059,502.41
Others 2,442,970.74 2,335,100.48 1,589,089.31 1,589,089.31
Total 7,768,255.94 3,116,156.20 8,294,340.88 2,648,591.72
lnterim Report 2022 255
6. Investment income
√ Applicable □ N/A
Unit: Yuan Currency: RMB
For the
Item For the Period Previous Period
Long-term equity investments income under cost method 310,288,053.40 592,353,897.50
Long-term equity investments income under equity method 576,377.39 -1,300,363.73
Investment income from disposal of long-term equity investments 4,242,404.46 0.00
Dividend income from other equity instrument investments 0.00 4,175,569.86
Investment income from disposal of financial assets held for trading 0.00 48,524.94
Total 315,106,835.25 595,277,628.57
7. Others
□ Applicable √ N/A
XVI. Supporting Information
1. Statement of non-recurring profit or loss
√ Applicable □ N/A
Unit: Yuan Currency: RMB
Item Amount
Gain or loss on disposal of non-current assets 3,731,885.55
Return, exemption and discharge of taxes resulting from approving ultra vires, or without formal 0.00
approval or incidentally incurred
Government grants as included in the current profit or loss, however, except for those which are 94,185,202.59
closely related to the normal business of an enterprise, comply with the policies of the State and
are continuously entitled with specific amount or quantity according to certain standards
Funds occupation fees charged from non-financial enterprises 0.00
Gains resulting from the investment cost of the enterprise for the purpose of acquisition of the 0.00
subsidiaries, joint operation and joint ventures is lower than the fair value of net identifiable assets
of the investee as entitled at the time of receipt of the investment
Profit or loss from exchange of non-monetary assets 0.00
Profit or loss from investment or management of assets by the others 0.00
Provision for impairment of assets accrued due to force majeure factors, such as natural disasters 0.00
Profit or loss from debts restructuring 0.00
Enterprise restructuring fees, such as the expenses for employees’ settlement and the integration 0.00
fees
Profit or loss exceeding the fair value and generated from the transaction of which the transaction 0.00
price is obviously unfair
Net profit or loss over the current period of the subsidiaries as a result of business combination 0.00
under common control from the beginning of the year to the date of consolidation
Profit or loss from contingent issues irrelevant to the Company’s normal business 0.00
Except for the efficient hedging related to the Company’s normal business, profit or loss from -98,936,528.71
changes in fair value as generated from financial assets and financial liabilities held for trading and
gains from investment as a result of the disposal of financial assets and financial liabilities held for
trading and debt investments
256 Joincare Pharmaceutical Group Industry Co., Ltd.
Item Amount
Reversals of provision for impairment of accounts receivable with individual impairment test 158,470.77
Profit or loss from entrusted loans 0.00
Gains or losses from changes in the fair values of investment properties that are subsequently 0.00
measured using the fair value model
Impact of a one-time adjustment on current profit and loss according to the requirements of tax 0.00
and accounting laws and regulations
Custody fees of entrusted operation 0.00
Other non-operating income and expenses besides the above items -2,270,691.97
Other items that conform to the definition of non-recurring profit or loss 0.00
Less: Effect of income tax 10,439,515.79
Effect of minority equity (After tax) -10,845,265.03
Total -2,725,912.53
Provide explanations for classifying non-recurring profit and loss items defined in the Explanatory Announcement No. 1
for Public Company Information Disclosures – Non-recurring Profits and Losses, and for classifying non-recurring profit
and loss items listed in the Explanatory Announcement No. 1 for Public Company Information Disclosures – Non-recurring
Profits and Losses as recurring profit and loss item.
□ Applicable √ N/A
2. Rate of return on net assets and earnings per share
√ Applicable □ N/A
Weighted average Earnings per share
Profit for the Reporting Period return on equity Basic EPS Diluted EPS
(%)
Net loss attributable to the Company’s ordinary shareholders 6.65 0.4235 0.4232
Net profit attributable to the parent company’s shareholders, 6.67 0.4249 0.4246
excluding non-recurring profit or loss
3. Differences in accounting data under domestic and foreign accounting standards
□ Applicable √ N/A
4. Others
□ Applicable √ N/A
Chairman: Zhu Baoguo
Date of Submission Approved by the Board: 10 August, 2022
Revised information
□ Applicable √ N/A
