Shanghai Fudan-Zhangjiang Bio-Pharmaceutical Co.,Ltd. provided consolidated earnings guidance for the six months ended June 30, 2022. For the six months, the company expected to record an net profit attributable to shareholders of the Company of approximately RMB 40 million to RMB 30 million during the Reporting Period (corresponding period in 2021: unaudited net profit attributable to shareholders of the Company of RMB 65.48 million), representing a loss over the corresponding period in 2021. The unaudited net profit attributable to shareholders of the Company after deducting the non-recurring profit or loss is expected to be approximately RMB 50 million to RMB 40 million (corresponding period in 2021: unaudited net profit attributable to shareholders of the Company after deducting the non-recurring profit or loss of RMB 54.54 million).

As far as the Board is aware, the decline in performance for the Reporting Period as compared to the corresponding period in 2021 was mainly attributable to the following: Since March 2022, the situation of the COVID-19 epidemic (the Epidemic) in Shanghai has been severe, and in accordance with the Epidemic prevention and control policy, the whole region has gradually implemented static management, which causes certain difficulties to the normal development of the Company's production, operation and research and development projects. In addition, the control on the external logistics has a great impact on the Company's raw materials supply and external drug distribution. As a result, the production and delivery of products cannot be completed as planned.

The Epidemic subsided and the whole-region-wide static management in Shanghai was gradually lifted in June, and the Company gradually resumed the production and operation. Although the Group actively organized production and logistics with good Epidemic precautions to minimize the impact of the Epidemic, and strived to compensate during June, the Company still recorded a decrease in revenues as compared to that in 2021, resulting in a decrease in other relevant financial data; The Company implemented the 2021 Restricted Shares Incentive Scheme to establish and improve the Company's long-term incentive mechanism, attract and retain the Company's management personnel, core technical personnel and other personnel, fully mobilize their enthusiasm and creativity. The share-based payments recognized during the Reporting Period were approximately RMB 50.50 million.

If excluding the impact of above-mentioned share-based payment expenses, the net profit attributable to shareholders of the Company during the Reporting Period would be approximately RMB 10.50 million to RMB 20.50 million, and the net profit attributable to shareholders of the Company after deducting the non-recurring profit or loss would be approximately RMB 0.50 million to RMB 10.50 million. There was no such expense in the same period of 2021.