Letter from the Management Team

Amidst the escalating global challenges of climate change, heightened tensions in US-China trade relations and geopolitical landscapes, and the ongoing impacts of the COVID-19 pandemic alongside the wave of technological digital advancements, it is imperative for us to uphold our founding principles as a pharmaceutical enterprise. We must continue to play a proactive role in breaking boundaries in innovation and drug development, leveraging our core influence to fulfill our mission of "Better science, Better lives," benefiting more patients, and contributing to a better life for humanity as a whole.

The year 2023 marked significant leaps in operational performance for PharmaEssentia. Our novel drug, Ropeginterferon alfa-2b (BESREMi R), for adult PV patients, successfully penetrated and generated revenue across three key pharmaceutical markets - Europe, the United States, and Japan, totaling NT$5.1 billion, representing a growth of approximately 77% from 2022. Additionally, we successfully completed Taiwan's biotechnology and medical industry's largest-scale international GDR fundraising project, raising a total of USD 462 million (approximately NT$14.1 billion). This infusion of funds aims to facilitate our global sales layout, enhance collaborations in new drug research and development, and support international clinical trials. Furthermore, our long-term efforts have been recognized by foreign institutional investors, as evidenced by our inclusion in the MSCI Global Standard Index, the TPEx 200 Index, and various FTSE Russell Global Equity Index Series. We have also received approval for official listing transfer from Taipei Exchange, TPEX, to the Taiwan Stock Exchange, TWSE on January 25, 2024.

Moreover, in 2023, it was the first phase of our company's sustainable development journey. Since the initiation of our sustainability journey in 2019 with the implantation of the first sustainable DNA, PharmaEssentia has been steadfastly advancing towards the United Nations Sustainable Development Goals. From initial inventory planning, execution, performance demonstration, outcome communication, to entering the phase of sustainable ascension, we have completed the first five-year blueprint plan. Sustainability efforts encompass environmental sustainability, product innovation, human capital management, patient access and affordability, business ethics, product quality and safety, as well as patient health and engagement. This comprehensive disclosure of information establishes a solid foundation for the company's ESG sustainability governance.

Additionally, our sustainability actions and reports have received numerous accolades, garnering recognition from external institutions. Awards include the "2023 Asia-Pacific Enterprise Awards – Corporate Excellence Award," the "2023 APSAA Asia-Pacific Sustainability Action Awards - Silver Award" and "TSAA Taiwan Sustainability Action Awards - Bronze Award," the 16th Taiwan TCSA "Sustainability Reporting: Healthcare Industry" - Platinum Award" and the 6th Global Corporate Sustainability Award, GCSA: Bronze Award, and the 25th "Technology Management Award" for the "Enterprise Team Award." In February 2024, we were further distinguished by inclusion in the S&P Global 2024 Sustainability Yearbook, ranking in the 98th percentile (top 2%) of ESG performance in the global biotechnology industry, positioning us as the first and only Taiwanese company to be selected, underscoring our exceptional ESG performance globally. Today, standing on the solid foundation of our company's gradually emerging positive impact and international recognition for our ESG performance in sustainable development, we will move forward with even greater confidence, courageously embarking once again on the next, more challenging journey towards authentic ESG.

The year 2023 remained a year filled with challenges as the world faced frequent occurrences of extreme weather events and geopolitical turmoil. These challenges have inflicted significant impacts on the economy and society, necessitating humanity to adapt to ever-changing crises. However, amidst these challenges, we witnessed PharmaEssentia's resilience, as it continued to grow under the evolving international landscape.

Our new-generation long-acting interferon, Ropeg, marketed as BESREMi®, obtained regulatory approvals for the treatment of Polycythemia Vera (PV) in numerous countries, with Japan granting PV drug certification in March 2023, bringing the total to over 40 countries. BESREMi continues to accumulate clinical data, strengthening its global leadership position. Particularly noteworthy, BESREMi® was elevated by NCCN Treatment Guidelines to the preferred medication for PV patients in the United States, helping early disease intervention for more patients. Furthermore, BESREMi® expanded its market presence in Latin America and still actively pursued market approvals in Singapore, China, Hong Kong and other places, demonstrating significant enhancement in its global footprint. In addition to PV indications, the company made breakthroughs in hematologic malignancies, successfully completing a global multicenter Phase III clinical trial for Ropeg in Essential Thrombocythemia (ET), heralding a new milestone in BESREMi's clinical development in other MPN indications.

Meanwhile, we commenced investments in the PharmaEssentia Innovation Research Center Corporation, PIRC, in the United States, along with the establishment of a new facility within the Hsinchu Biomedical Science Park, Taiwan. Additionally, we expanded the warehouse logistics business of our subsidiary, Panco Healthcare, further strengthening our regional capabilities. As PharmaEssentia's global footprint continues to expand, the company is actively allocating more resources to corporate sustainability efforts. Externally, we participated in the Bloomberg Gender Equality Index (GEI) survey for the first time and continued to sponsor three social welfare projects, exerting societal influence in cultural activities, health promotion, and biodiversity. Internally, our Taichung plant successfully implemented the ISO 14064-1 greenhouse gas (GHG) inventory management system with plans to introduce ISO 14001 environmental management and ISO 45001 occupational health and safety management systems in 2024. Furthermore, in response to recent climate disasters, we initiated the adoption of the TCFD framework, continuously conducting financial assessments of climate-related risks and opportunities, formulating adaptation strategies, and aiming to build a robust climate change governance and strategy. We are committed to maintaining resilience in the face of evolving climate conditions, actively anticipating and mitigating future challenges, and fortifying the company's ability and resilience to address climate change issues.

In 2023, PharmaEssentia reached a pivotal moment in its growth trajectory, with notable advancements in product innovation and market expansion, alongside proactive efforts in sustainable development, setting a robust groundwork for future progress. Looking ahead, we will continue to expand our global presence, commit to serving more patients, and realize the company's vision and mission.