On 2 March 2017, Fosun Pharma (stock code: 600196.SH, 02196.HK) announced that Chongqing Pharmaceutical Research Institute Co., Ltd. (hereinafter referred to as “CPIRI”), its holding subsidiary, recently received a warning letter issued by the U.S. Food and Drug Administration (“FDA”) regarding inadequate compliance of laboratory data found in the inspection on APIs, which was conducted in the QC Laboratory in CPIRI’s factory at Tushan Road, Nan’an District, Chongqing, China (hereinafter referred to as “Tushan Road QC Laboratory during 16 May 2016 to 19 May 2016 (hereinafter referred to as “Warning Letter”).

In response to the requirements proposed in the Warning Letter for rectifications against the inadequate compliance in Tushan Road QC Laboratory, CPIRI will submit a reply report within the time specified by FDA, detailing each rectification measures that have been taken and their completed plan. CPIRI will conduct effective rectification in such aspects as quality culture development, hardware facility development and trainings for internal staff and stay in active communication with FDA in a bid for early close of the warning.

Up to the date of announcement, the 3 APIs (including iron sucrose, Pemetrexed and Abiraterone) produced at the CPIRI’s factory at Tushan Road, Nan’an District, whose access to the U.S. market were temporarily denied due to the Warning Letter, remain at the stage of registration and have not been commercialized in the U.S.. The Company states that, in view of the previous sales revenue data, the Warning Letter is expected not to have significant impact on the performance of Fosun Parma in 2016 and 2017.