PROPOSED OVERSEAS LISTING OF SHANGHAI HENLIUS BIOTECH, INC. ON THE HONG KONG STOCK EXCHANGE

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1 Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement. This announcement is for information purposes only and does not constitute an invitation or offer to acquire, purchase or subscribe for any securities nor is it calculated to invite any such offer or invitation. In particular, this announcement does not constitute and is not an offer to sell or an invitation or a solicitation of any offer to buy or subscribe for any securities in Hong Kong, the United States of America or elsewhere. Securities may not be offered or sold in the United States of America absent registration or an exemption from registration under the United States Securities Act of 1933, as amended (the U.S. Securities Act ). The securities described herein have not been and will not be registered under the U.S. Securities Act. There will be no public offering of securities in the United States of America or any jurisdiction other than Hong Kong. Not for release, publication or distribution, in whole or in part, directly or indirectly, in, into or from the United States of America or any jurisdiction where to do so would constitute a violation of the relevant laws or regulations of such jurisdiction. 上海復星醫藥 ( 集團 ) 股份有限公司 Shanghai Fosun Pharmaceutical (Group) Co., Ltd. * (a joint stock limited company incorporated in the People s Republic of China with limited liability) (Stock Code: 02196) INSIDE INFORMATION PROPOSED OVERSEAS LISTING OF SHANGHAI HENLIUS BIOTECH, INC. ON THE HONG KONG STOCK EXCHANGE AND WITHDRAWAL OF APPLICATION FOR QUOTATION OF SHANGHAI HENLIUS BIOTECH, INC. ON THE NATIONAL EQUITIES EXCHANGE AND QUOTATIONS SYSTEM This announcement is made by Shanghai Fosun Pharmaceutical (Group) Co., Ltd.* (the Company, together with its subsidiaries, the Group ) pursuant to the Inside Information Provisions under Part XIVA of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) and Rule of The Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the Hong Kong Listing Rules ). 1

2 PROPOSED OVERSEAS LISTING OF SHANGHAI HENLIUS BIOTECH, INC. ON THE HONG KONG STOCK EXCHANGE The board of directors of the Company (the Board ) is pleased to announce that at a meeting held on 27 September 2018, the Board considered and approved, among other things, the resolutions in relation to the proposed overseas listing of Shanghai Henlius Biotech, Inc. ( Shanghai Henlius, together with its subsidiaries, the Shanghai Henlius Group ) on The Stock Exchange of Hong Kong Limited (the Hong Kong Stock Exchange ). Shanghai Henlius was incorporated in the People s Republic of China ( PRC ) in As at the date of this announcement, 上海復星醫藥產業發展有限公司 (Shanghai Fosun Pharmaceutical Industrial Development Limited*) ( Fosun Pharma Industrial ) and 上海復星新藥研究有限公司 (Shanghai Fosun New Medicine Research Company Limited*) ( Fosun New Medicine ), both are subsidiaries of the Company, owned approximately 5.032% and % shareholding interests in Shanghai Henlius, respectively. Accordingly, the Company, through Fosun Pharma Industrial and Fosun New Medicine, indirectly owns a total of approximately % shareholding interest in Shanghai Henlius. Shanghai Henlius is primarily engaged in research and development ( R&D ), manufacturing and sale of monoclonal antibody ( mab ) drugs and the provision of related technical services. 1. THE RESOLUTION IN RELATION TO THE COMPLIANCE OF THE OVERSEAS LISTING OF SHANGHAI HENLIUS WITH THE CIRCULAR ON ISSUES IN RELATION TO REGULATING OVERSEAS LISTING OF SUBSIDIARIES OF DOMESTIC LISTED COMPANIES The proposed overseas listing of Shanghai Henlius complies with the Circular on Issues in relation to Regulating Overseas Listing of Subsidiaries of Domestic Listed Companies (Zheng Jian Fa 2004 No. 67) ( 關於規範境內上市公司所屬企業到境外上市有關問題的通知 ( 證監發 [2004]67 號 )) (the Circular ) issued by China Securities Regulatory Commission (the CSRC ). The Company, as the controlling shareholder of Shanghai Henlius, complies with the following conditions under Article 2 in the Circular: (1) The listed company has been profitable in the latest three years consecutively Pursuant to the audit reports of Ernst & Young Hua Ming (2018) Shen Zi No _B01, Ernst & Young Hua Ming (2017) Shen Zi No _B01 and Ernst & Young Hua Ming (2016) Shen Zi No _B01 issued by Ernst & Young Hua Ming CPAs (special general partnership), the net profit attributable to owners of the parent company as realised by the Group (on a consolidated basis) for the years ended 31 December 2017, 31 December 2016 and 31 December 2015 amounted to approximately RMB3,124,499,549.35, RMB2,805,837, and RMB2,460,093,583.58, respectively, which complies with the provision of profitable in the latest three years consecutively. 2

3 (2) The businesses and assets in which the listed company has invested with the proceeds from its share issues and fundraisings within the latest three accounting years shall not be used as its capital contribution to the subsidiaries for the purpose of applying for overseas listing The businesses and assets in which the Company has invested with the proceeds from its share issues and fundraisings within the latest three accounting years were not used as its capital contribution to Shanghai Henlius. (3) The net profit of the subsidiary that the listed company is entitled to according to the equity in the consolidated statements for the latest accounting year shall not exceed 50% of the net profit in the consolidated statements of the listed company The audited net profit of Shanghai Henlius that the Group is entitled to according to the equity interests in the consolidated statements for the financial year ended 31 December 2017 accounted for less than 50% of the audited net profit in the consolidated statements of the Group. (4) The net assets of the subsidiary that the listed company is entitled to according to the equity in the consolidated statements for the latest accounting year shall not exceed 30% of the net assets in the consolidated statements of the listed company The audited net assets of Shanghai Henlius that the Group is entitled to according to the equity interests in the consolidated statements for the financial year ended 31 December 2017 accounted for less than 30% of the audited net assets in the consolidated statements of the Group. (5) There is no competition within the same industry between the listed company and the subsidiary, and they are independent from each other in assets and finance, and have no overlapping management (i) There is no competition within the same industry between the listed company and the subsidiary The principal business of the Group mainly comprises the sectors of (a) pharmaceutical manufacturing and R&D, (b) healthcare services, (c) medical devices and medical diagnosis and (d) pharmaceutical distribution and retail. Shanghai Henlius is a subsidiary of the pharmaceutical manufacturing and R&D sector of the Group, and is primarily engaged in R&D, manufacturing and sale of mab drugs and the provision of related technical services. The products of the Shanghai Henlius Group and other pharmaceutical companies in the sector of pharmaceutical manufacturing and R&D of the Group (other than the Shanghai Henlius Group) are different and could be clearly distinguished: The Shanghai Henlius Group is carrying out R&D of mab products, and the other subsidiaries of the Group in the sector of pharmaceutical manufacturing and R&D do not engage in the R&D and manufacturing of mab products. 3

4 Accordingly, Shanghai Henlius is the only platform of the Group for carrying out related businesses of mab products and there is no competition within the same industry between the Group (other than the Shanghai Henlius Group) and the Shanghai Henlius Group. (ii) The listed company and the subsidiary are independent from each other in assets and finance The Company and Shanghai Henlius have their own independent and completely separate operational assets with clear ownership. Shanghai Henlius conducts registrations, prepares accounts and carries out accounting and management independently for all its assets. The Company has never occupied or disposed of any assets of Shanghai Henlius, or intervened with the operation and management of any assets by Shanghai Henlius. The Company and Shanghai Henlius have set up independent finance departments and established financial accounting and management systems. The Company and Shanghai Henlius have their own bank accounts, pay their respective tax separately and make financial decisions independently. (iii) The managers of the listed company and the subsidiary do not hold any overlapping positions in each other As at the date of this announcement, the senior management of the Company and the senior management of Shanghai Henlius do not hold any overlapping positions in each other. (6) The shares of the subsidiary held by the directors, senior management of the listed company and the subsidiary and their affiliated persons shall not exceed 10% of the total share capital of the subsidiary prior to the overseas listing As at the date of this announcement, the directors and senior management of the Company and Shanghai Henlius and their respective affiliated persons do not hold more than 10% of the shares of Shanghai Henlius. (7) The funds or assets of the listed company are not in the possession of the individual, legal person or other organization and their related parties which has the actual controlling power over the listed company, and there are no major connected transactions that would prejudice the interests of the listed company There are no funds or assets of the Company that is in the possession of individual, legal person or other organisation and their related parties which has the actual controlling power over the Company, and there are no major related party transactions that would prejudice the interests of the Company. 4

5 (8) The listed company has no acts of major violations of laws or regulations in the latest three years The Company has no acts of major violations of laws or regulations in the latest three years immediately preceding the date of this announcement. In conclusion, the overseas listing of Shanghai Henlius complies with the relevant provisions under the Circular. 2. THE RESOLUTION IN RELATION TO THE OVERSEAS LISTING OF SHANGHAI HENLIUS The detailed plan in relation to the spin-off and overseas listing of Shanghai Henlius is set out below: (1) Issuing entity: Shanghai Henlius. (2) Place of listing: The Main Board of the Hong Kong Stock Exchange. (3) Type of securities to be issued: Overseas listed foreign shares to be listed on the Main Board of the Hong Kong Stock Exchange (H shares). (4) Nominal value: RMB1.00 each. (5) Target subscribers: Hong Kong public investors, qualified international investors, qualified PRC investors and other investors entitled to foreign securities investment pursuant to the PRC laws and regulations or the approvals from the PRC regulatory authorities. (6) Listing date: The listing date will be determined by the board of directors of Shanghai Henlius to be authorised by the general meeting of Shanghai Henlius or the authorised representative(s) of the board of directors of Shanghai Henlius in accordance with the international capital market conditions, the approval progress of domestic and overseas regulatory authorities and other conditions. (7) Method of issuance: (i) Hong Kong public offering of ordinary shares to the public in Hong Kong; and (ii) international placing of ordinary shares to qualified international investors in the United States pursuant to Rule 144A under the U.S. Securities Act or outside the United States in an offshore transaction (including offering to professional and institutional investors in Hong Kong) pursuant to Regulation S under the U.S. Securities Act or other exemptions from registration under the U.S. Securities Act or preferential offering of shares in accordance with applicable rules. (8) Size of issuance: Taking into consideration the requirement of the Hong Kong Stock Exchange in relation to public float and the funding requirement for future development of Shanghai Henlius, the initial offering size of the current H share offering will be no more than 15% of the enlarged total share capital of Shanghai Henlius immediately after the offering 5

6 (before the exercise of the over-allotment option). In addition, it is proposed that the underwriter(s) will be granted an over-allotment option of no more than 15% of the number of ordinary shares to be offered. The final offering size will be determined by the board of directors of Shanghai Henlius to be authorised by the general meeting of Shanghai Henlius or the authorised representative(s) of the board of directors of Shanghai Henlius in accordance with the laws and regulations, regulatory approvals and market conditions. The number of H shares of Shanghai Henlius actually issued after the completion of the issuance pursuant to the international underwriting agreement and Hong Kong underwriting agreement signed by Shanghai Henlius with the relevant underwriters respectively shall prevail. The increased registered capital of Shanghai Henlius shall also be subject to the number of new shares actually issued after the completion of the issuance and the approvals by the relevant domestic and foreign regulatory authorities, the Hong Kong Stock Exchange and other relevant agencies. (9) Pricing Method: The final offer price will be determined based on full consideration of the interests of the existing shareholders of Shanghai Henlius and foreign investors in accordance with the international practice, overseas capital market conditions for the issuance, the average valuation level of the industry that Shanghai Henlius engages in, the conditions of market subscriptions based on the results of the road show and book building, and the mutual agreement between the board of Shanghai Henlius or the authorised representative(s) of the board as authorised by the general meeting of Shanghai Henlius and the underwriters. (10) Underwriting: The issuance will be underwritten by the underwriter syndicate organised by the lead underwriter. (11) Application for the Conversion of Domestic Shares and Unlisted Foreign Shares of Shanghai Henlius to Overseas Listed Foreign Shares and the Listing and Trading of Such Shares on the Hong Kong Stock Exchange: (1) In accordance with the applicable rules and policies of the CSRC and applicable regulatory authorities, it is proposed that Shanghai Henlius accept the entrustment of its foreign shareholders to apply for the conversion of the foreignsharesheldbytherelevant shareholders into overseas listed foreign shares (H shares) and listing of such shares on the main board of the Hong Kong Stock Exchange at the same time it makes an application for the approval of the CSRC in relation to the offering and listing. It is also proposed that Shanghai Henlius will authorise its board of directors or the authorised representative(s) by the board to deal with matters according to the entrustment of the relevant shareholders in relation to the conversion of such foreign shares into overseas listed foreign shares (H shares) and the listing of such shares on the condition that CSRC will accept such application. (2) In accordance with the applicable rules and policies of the CSRC and applicable regulatory authorities, it is proposed that Shanghai Henlius will make an application to the relevant regulatory authorities before the offering of overseas listed foreign shares (H shares) or upon the listing for approval to convert part or all of the domestic shares of Shanghai Henlius to overseas listed foreign shares (H shares) for listing and trading on the Hong Kong Stock Exchange. It is also proposed that Shanghai Henlius will authorise its board 6

7 of directors or the authorised representative(s) by the board to deal with matters in accordance with the applicable rules and policies of the CSRC and applicable regulatory authorities in relation to the conversion of such domestic shares into overseas listed foreign shares (H shares) and the listing of such shares on the Hong Kong Stock Exchange. (12) Use of proceeds: The proceeds of the proposed overseas listing (excluding the offering expenses) of Shanghai Henlius is proposed to be used for R&D and carrying out clinical trials of products, supplement general working capital and license in related technology. The above plan is a preliminary proposal, which is still subject to the approval by the shareholders of the Company at its general meeting, and the approval by the CSRC and the Hong Kong Stock Exchange. As it is expected that the highest of the applicable percentage ratios (as defined in the Hong Kong Listing Rules) in respect of the spin-off and overseas listing of Shanghai Henlius would be less than 5%, the spin-off and overseas listing of Shanghai Henlius, if it proceeds, would not constitute a discloseable transaction for the Company under the Hong Kong Listing Rules. Shareholders of the Company should note that the spin-off and overseas listing of Shanghai Henlius on the Hong Kong Stock Exchange will constitute a spin-off within the meaning of Practice Note 15 of the Hong Kong Listing Rules ( Practice Note 15 ) and will be subject to the approval of the Hong Kong Stock Exchange. An application for the spin-off and listing of Shanghai Henlius on the Main Board of the Hong Kong Stock Exchange will be made by the Company to the Hong Kong Stock Exchange. 3. THE RESOLUTION IN RELATION TO THE UNDERTAKING OF MAINTAINING INDEPENDENT LISTING STATUS OF THE COMPANY The Company and Shanghai Henlius are independent from each other in the aspects of staff, asset, finance, institution, business and others. They have independent accounting systems and will independently undertake liabilities and risks. The overseas listing of Shanghai Henlius will have no material impact on the sustainable operation of other business segments of the Group, neither will it affect the Company in maintaining its independent listing status, which is in compliance with applicable laws, regulations, rules and regulatory documents as well as the requirements prescribed in the Circular. The Company will engage a securities institution registered with the CSRC and listed among the sponsors as the financial advisor of the Company in accordance with the Circular, which will provide financial advice in relation to ensuring the ongoing independence listing status and maintaining the sustainable operation of the core assets and businesses of the Company upon the overseas listing of Shanghai Henlius, as well as continue to supervise the Company to maintain its independent listing status. 7

8 4. THE RESOLUTION IN RELATION TO THE DESCRIPTION OF THE SUSTAINABLE PROFITABILITY AND PROSPECTS OF THE GROUP Each business of the Group has maintained excellent momentum at present as the Shanghai Henlius Group maintains a high degree of business independence from the other business sectors of the Group. The overseas listing of Shanghai Henlius will have no material impact on the sustainable operation of other businesses of the Group. In addition, in the event of successful listing of Shanghai Henlius, which will provide an independent financing platform, other business sectors of the Group will be able to further develop through the direct finance provided by the Company. Therefore, the overseas listing of Shanghai Henlius will firmly facilitate the strategic upgrade of the Company, further consolidate the core competitiveness of the Group and promote the sustainable development of the Group. In general, upon the overseas listing of Shanghai Henlius, the Group is able to continue and maintain sustainable operation and profitability. 5. THE RESOLUTION IN RELATION TO THE AUTHORISATION TO THE BOARD TO DEAL WITH FULL DISCRETION WITH THE OVERSEAS LISTING AND THE RELATED MATTERS OF SHANGHAI HENLIUS Authorisation is proposed to be granted by the shareholders meeting of the Company to the Board and authorised to be delegated from the Board to its authorised persons (being the chairman and/or president of the Company) in dealing with the related matters of the overseas listing of Shanghai Henlius at their full discretion, including without limitation (i) to exercise, at their full discretion, the rights as a shareholder of Shanghai Henlius on behalf of the Company in relation to the related matters of the overseas listing of Shanghai Henlius, (ii) to make adjustments and modifications to the matters in relation to the overseas listing of Shanghai Henlius based on the specific conditions, (iii) to submit the relevant applications for the spin-off and listing of Shanghai Henlius to the relevant authorities, including the Hong Kong Stock Exchange and CSRC (if applicable)atitsfull discretion and to deal with related matters, (iv) to sign, submit and revise, as they consider necessary, appropriate or desirable, the contracts, agreements, undertakings or other relevant legal documents to be signed or issued by the Company in relation to the overseas listing of Shanghai Henlius, and (v) to decide and deal with other relevant matters in relation to the overseas listing of Shanghai Henlius. The abovementioned authorisation is valid for 18 months from the date of these resolutions being considered and approved at the general meeting of the Company. 8

9 6. THE RESOLUTION IN RELATION TO THE PROVISION OF ASSURED ENTITLEMENTS TO H-SHARE SHAREHOLDERS OF THE COMPANY ONLY FOR THE SPIN-OFF AND OVERSEAS LISTING OF SHANGHAI HENLIUS In relation to the spin-off and overseas listing of Shanghai Henlius, pursuant to the requirements under Practice Note 15, the Company is required to have due regard to the interests of its existing shareholders by way of providing the existing shareholders with an assured entitlement to the new shares in Shanghai Henlius. Due to the impediments arising from legal and policy perspectives for providing the assured entitlement to existing A-share shareholders of the Company, the Company is only able to provide the assured entitlement to H-share shareholders in order to comply with the requirements under Practice Note 15. WITHDRAWAL OF APPLICATION FOR QUOTATION OF SHANGHAI HENLIUS BIOTECH, INC. ON THE NATIONAL EQUITIES EXCHANGE AND QUOTATIONS SYSTEM Reference is made to the announcement issued by the Company on 10 August 2016 in relation to the proposed application for quotation of Shanghai Henlius on the National Equities Exchange and Quotations System (the Proposed Quotation ). On 27 September 2018, the Board resolved to approve the withdrawal by Shanghai Henlius of the application for the Proposed Quotation and authorise the management of the Company and any person authorised by the management of the Company to deal with all related matters. On the same date, Shanghai Henlius has made such application to the National Equities Exchange and Quotations System. GENERAL INFORMATION The Company will publish further announcement(s) regarding the overseas listing of Shanghai Henlius on the Hong Kong Stock Exchange in due course or in accordance with the applicable requirements of the Hong Kong Listing Rules. 9

10 The shareholders and potential investors of the Company are advised to note that the spin-off and overseas listing of Shanghai Henlius is subject to, among other things, the approval of the shareholders of the Company and Shanghai Henlius, the approval of CSRC and the Hong Kong Stock Exchange, the final decision of the Board and of the board of directors of Shanghai Henlius, market conditions and other factors. Accordingly, the shareholders and potential investors of the Company should be aware that there is no assurance that the spin-off and overseas listing of Shanghai Henlius will take place or as to when it may take place. Shareholders and potential investors of the Company should therefore exercise caution when dealing in the securities of the Company. Any person who is in doubt about his/her/its position or any action to be taken is recommended to consult his/her/its own professional advisers. Shanghai, the People s Republic of China 27 September 2018 By Order of the Board Shanghai Fosun Pharmaceutical (Group) Co., Ltd.* Chen Qiyu Chairman As at the date of this announcement, the executive directors of the Company are Mr. Chen Qiyu, Mr. Yao Fang and Mr. Wu Yifang; the non-executive directors of the Company are Mr. Wang Qunbin, Mr. Wang Can, Ms. Mu Haining and Mr. Zhang Xueqing; and the independent non-executive directors of the Company are Mr. Cao Huimin, Mr. Jiang Xian, Dr. Wong Tin Yau Kelvin and Mr. Wai Shiu Kwan Danny. * for identification purposes only 10