About Gland Pharma Ltd

Gland Pharma Ltd was incorporated as Gland Pharma Private Limited', a private limited company under the Companies Act, 1956 on March 20, 1978 and was granted the certificate of incorporation by Registrar of Companies, Andhra Pradesh at Hyderabad. Subsequently, the name of the Company was changed to Gland Pharma Limited' pursuant to a special resolution passed by the shareholders of the Company on December 5, 1994 and a fresh certificate of incorporation dated April 25, 1995 was issued by the Registrar of Companies, Andhra Pradesh at Hyderabad consequent upon change of name and conversion into a public limited company under the Companies Act, 1956. The Company is primarily engaged in manufacturing injectable formulations. The company is one of the fastest growing generic injectables-focused companies by revenue in the United States from 2014 to 2019. The company has 8 manufacturing facilities in India, comprising four finished formulations facilities with a total of 23 production lines and three API facilities. The company sells products primarily under a business to business (B2B) model in over 60 countries as of March 31, 2022, including the United States, Europe, Canada, Australia, India and the Rest of the world. The company has a consistent compliance track record with a range of regulatory regimes across these markets. The company also have an extensive track record in complex injectables development, manufacturing and marketing and a close understanding of the related sophisticated scientific, technical and regulatory processes. The company has expanded it nature of business from liquid parenterals to cover other elements of the injectables value chain, including contract development, own development, dossier preparation and filing, technology transfer and manufacturing across a range of delivery systems. Over the years, the company has made substantial investments in the companies manufacturing infrastructure to support the product portfolio needs and reach. The company has seven manufacturing facilities in India, comprising four finished formulations facilities with a total of 22 production lines and three API facilities. The companies API facilities provide with in-house manufacturing capabilities for critical APIs, enabling the company to control costs and quality and mitigate supply chain related risks around the key products. The companies capabilities as a vertically integrated company include internal research and development (R&D) expertise, robust manufacturing capabilities, a strict quality assurance system, extensive regulatory experience and established marketing and distribution relationships. As of March 31, 2020, the company along with partners had 265 ANDA filings in the United States, of which 204 were approved and 61 were pending approval. The 265 ANDA filings comprise 189 ANDA filings for sterile injectables, 50 for oncology and 26 for ophthalmics related products. Out of these 265 ANDA filings, 100 represent ANDAs owned by the company, of which 63 ANDA filings are approved and 37 are pending approval. As of the same date, the company along with partners had a total of 1,415 product registrations, comprising 368 product registrations in the United States, Europe, Canada and Australia, 54 in India and 993 in the Rest of the world. The company also has a consistent regulatory compliance track record and all the facilities are approved by the USFDA from whom the company have had no warning letters since the inception of each facility. Other key regulatory agencies for which certain of our facilities have approvals include MHRA (UK), TGA (Australia), ANVISA (Brazil), AGES (Austria) and BGV Hamburg (Germany). During the year 2020-21, the Company has incorporated Gland Pharma International Pte. Ltd., a Wholly-owned Subsidiary in Singapore. It has incurred capital expenditure of Rs. 2,287.76 million at its manufacturing facilities at Dundigal, Pashamylaram, VSEZ and Pharmacity. It has issued and allotted 8,333,333 fully paid-up equity shares in the Initial Public Offer during November, 2020. During FY 2022, the Company launched 47 product SKUs of 28 molecules like Micafungin, Ziprasidone, Bivalirudin RTU and Olapatadine Ophthalmic (OTC). As of March 31, 2022, it along with the partners had 284 ANDA filings in the US, of which 234 were approved and 50 were pending approval. Out of these, 115 were owned by the Company with 85 approvals and 30 pending for approval. It had manufacturing capacity for finished formulations of approximately 767 million units per annum. It filed 21 ANDAs, 5 DMFs and received 32 ANDA approvals. It signed an agreement to supply upto 252 million doses of RDIF's Sputnik V COVID-19 vaccine. It purchased assets of Vitane Biologics, Hyderabad based biopharmaceutical company. On 27th April, 2023, Gland Pharma International Pte. Ltd., Wholly Owned Subsidiary of the Company acquired Phixen SAS and 3 holding companies in Cenexi for a purchase consideration costing Euro 114,259,004.44 and repaid a loan of Euro 79,457,194.11 on behalf of the Sellers through Share Purchase Agreement dated 6th January, 2023 and as a result, Phixen SAS and the Cenexi Holding Entities became the Wholly Owned step-down Subsidiaries of the Company, which in turn resulted in indirect acquisition of 7 subsidiaries of Cenexi, a) Cenexi SAS, (b) Cenexi Services SAS, (c) Cenexi HSC SAS, (d) Cenexi 2 SASU, (e) Cenexi 3 SASU, (f) Cenexi Laboratories Thissen SA and (g) Phineximmo SA. 'Dexrazoxane' the first product was launched in China during the year 2023.

Gland Pharma Ltd Chairman Speech

Strengthening our core resiliently

We made concerted efforts to minimize the impact of supply disruptions by roping in new suppliers as well as optimizing our production efficiencies. We also ensured that our new product launches in target markets continued throughout the year as per our internal plan.

-Srinivas Sadu, MD & CEO

The Year That Was FY 2022-23 was a rollercoaster, giving us a mixed bag of positives and headwinds. But we kept our unwavering focus on strengthening our core to ensure that our business remains stable and continues to create long-term value for all our stakeholders. Amidst various external and internal challenges, we kept up our quest to achieve geographic diversification, enhancement of our product portfolio, completion of a strategic acquisition, new market entry and reinforcement of our quality and compliance parameters. These will act as our growth catalysts over the medium and long term. The combined experience and expertise of our teams continue to drive our future business plans and hold us in good stead as we move forward.

The year posed considerable challenges, owing to supply chain disruptions; non-availability and long lead times for several raw materials and primary packing materials worried us all through the year, causing production delays in our plants. While in the first half of the year we faced challenges in the Indian and Rest-of-the-World (RoW) markets, in the latter half we experienced a softer offtake of some of our key products in the US market. Inventory build-up at our customers' end, normalisation of COVID-related sales and strategic shifts at some of our customers also adversely impacted our top-line, while increased power cost, one-time M&A expenses and insolvency filing by one of our customers, among other reasons, impacted our bottom-line.

We made concerted efforts to minimize the impact of supply disruptions by roping in new suppliers as well as optimizing our production efficiencies. We also ensured that our new product launches at target markets continued throughout the year as per our internal plan.

Operational Performance

In April 2023, Gland Pharma acquired 100% of Cenexi. Founded in 2004, Cenexi and its subsidiaries are engaged in Contract Development & Manufacturing Operations (CDMO) of pharmaceutical products with expertise in sterile liquid and lyophilized fill-finished drug, including capabilities in oncology and complex products. Cenexi has four manufacturing sites in Europe – three in France and one in Belgium.

We seek to expand our CDMO offerings in the European market and build a manufacturing presence there. Acquiring Cenexi gives us access to knowhow and development capabilities in sterile forms, including for ophthalmic gel, needleless injectors and hormones. It will help us expand our global presence and further cement our identity as an injectables-focused CDMO Company. This is our first acquisition overseas, and it is in line with our long-term growth objectives. We have now emerged as one of the largest players in the generic small-molecule injectables CDMO space. We are well prepared to focus on integrating the business and drawing synergistic benefits from this opportunity.

We also made progress on our path to building a bio-CDMO and signed our first contract. It is a testimony to our team's strength and the robust infrastructure installed at our facility in Shamirpet.

I am happy to inform you that we received our first product approval in China during the year, and also launched our first product, Dexrazoxane; this is an important accomplishment. We expect to receive another three or four product approvals in China during FY 2023-24.

We also made strong progress in our complex portfolio by filing three complex products during the financial year 2023. As of March 23, we had filed a total of seven products within the Hormone and Peptide complex product portfolio.

We commercialized products including Bortezomib, Pemetrexed, Pantoprazole, Cyanocobalamin and Bumetanide in the US market. We also launched other products including Bortezomib in Australia, Oxaliplatin in Canada, and Bortezomib in Europe. Ethacrynate Sodium, Ganciclovir, Foscarnet Sodium and Labetalol Hydrochloride were registered in new geographies.

To strengthen our existing customer relationships and form new partnerships in target markets to drive growth, we operationalized new offices in the US and Singapore. This will align our internal product pipeline strategy with our customers' feedback, mitigate some supply chain disruptions in future, and also help us explore partnerships to accelerate our entry into the biologic biosimilar CDMO space.

Our strength in manufacturing high-volume sterile products, coupled with our excellent compliance track record, made us stand out from the competition. We continued to invest in R&D, and completed 29 ANDA and 9 DMF filings during the year. Going forward, despite increasing competition in our new products, we remain confident of our launch pipeline.

Financial Performance

We made a consolidated revenue of H 36,246 Mn during the year. Gross Profit margin improved compared to the previous year, largely due to our favourable geography mix. EBITDA stood at H 10,248 Mn, and PAT at H 7,810 Mn. Our performance was subdued largely due to lower sales in some key products as compared to the previous year, and a higher base owing to sales of certain COVID-related products.

Revenue from our core markets – US, Canada, Europe, Australia and New Zealand – stood at H 26,851 Mn in FY 23, accounting for 75% of Total Revenue. Our RoW market – the key geographies being MENA, LATAM and select South-East Asian countries – generated H 6,894 Mn. Revenue from the Indian market was H 2,501 Mn (8% of Total Revenue), due to the negative impact caused by the coming-back-to-normal of COVID-related sales, and our Insulin production line at the Dundigal facility shutting down for line upgradation.

As on March ‘23, we had H 37,707 Mn cash, part of which we utilized to acquire Cenexi. Our existing cash position provides sufficient cushion to carry out our organic capex plans to augment future growth.

Looking Beyond Business

Our outlook as a responsible corporate citizen has never remained confined to just our injectables business. For us, CSR goes far beyond being just a statutory requirement; it is an integral part of our growth as a company, and remains at the very core of our operations and business values. We have always been committed to serving the larger community around us.

We strive assiduously to achieve the UN's Sustainable Development Goals (SDGs), and seek out avenues to make a positive difference to the planet and people around us. We engage in social and economic outreach projects that make an immediate difference, and are also aimed at yielding long-term benefits. They include providing free breakfast-cum-health support to underprivileged children, developing government schools' infrastructure, improving the quality of poor children's education, kindling the scientific spirit in them, supporting orphanages / homes for people with disabilities, assisting in eye care for the elderly, striving for community / rural development, social justice, women's empowerment, public health and safety, strengthening medical infrastructure in government hospitals, working for tribal communities' welfare, promoting sports, protecting wildlife and conserving the environment.

We received some heart-warming endorsements of our CSR endeavour during the year:

We were bestowed with ‘The CSR Journal Excellence Award' in the ‘Health and Sanitation' category.

Three of our Rural Development initiatives have been incorporated by the Ministry of Education (Government of India) in their new BBA (Rural Management) curriculum.

Our strength in manufacturing high-volume sterile products, coupled with our excellent compliance track record, made us stand out from the competition. We continued to invest in R&D, and completed 29 ANDA and 9 DMF filings during the year. Going forward, despite increasing competition in our new products, we remain confident of our launch pipeline.

Mapping the Road Ahead

Despite uncertainties in the operating environment, we are leveraging our intrinsic strengths to grow sustainably with a long-term approach. We are continually building our capabilities through strategic investments and equipping ourselves with the right technology and expertise.

Our strategic priorities comprise:

Geographic Expansion: China will continue to remain our key focus; a couple of our products filed there are in advanced stages of regulatory review. We are also expanding our presence in the RoW markets, especially in South Africa and Kazakhstan.

Portfolio Development: We have been investing in new manufacturing lines for technologies involving microspheres and combi-vials to support our complex development portfolio.

Leveraging synergistic benefits from our Cenexi acquisition, in terms of cross selling, access to new technology, and optimising costs. Our priority is to focus on seamless integration of our businesses.

Establishing a Biosimilar CDMO: We are keenly exploring external partnerships with our existing partners. Alongside ongoing site visits, we are also in advanced stages of negotiation for signing customer contracts.

It is against tough odds that the true mettle of a champion comes to the fore. ‘When the going gets tough', it is said, ‘the tough get going'. The challenging operating environment we witnessed in FY 2022-23 has only reinforced our commitment to our longer-term objectives. As we look ahead, we are confident that our differentiated business model, continued focus on operational efficiencies and innovation, ‘Quality First' approach and compliance – which have always been our core strengths – will enable us to navigate the challenges of both our domestic and global markets, and achieve sustained growth and profitability.

I would like to conclude by thanking our shareholders, communities, employees, customers, vendors and other stakeholders for their unwavering support in the challenging year that went by. We are confident that our stakeholders will continue to have faith in our strategic initiatives.

Dear Members,

Your Directors take pleasure in presenting the 44^th Annual Report on the performance of the Company, along with the audited Standalone and Consolidated Financial Statements for the Year ended 31^st March, 2022.

Financial Highlights

(H in Mn)

Annual Return [Section 134(3)(a)]

The Annual Return of the Company as on March 31, 2022 is available on the Company’s website and can be accessed at https://glandpharma.com/investors/investors_annual_report

Meetings of the Board of Directors [Section 134(3)(b)]

During the year under review, the Board of Directors met 5 times on 17^th May, 2021; 21^st July, 2021; 22^nd October, 2021; 21^st January, 2022 and 10^th March, 2022.

Directors’ Responsibility Statement [Section 134(3)(c) and 134(5)]

In terms of Section 134(3)(c) and 134(5) of the Companies Act, 2013 your directors state that:

a) in preparation of the annual accounts for the year ended 31^st March, 2022; the applicable accounting standards have been followed along with proper explanations relating to material departures, if any;

b) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2022 and of the profit of the Company for the year ended on that date;

c) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) they have prepared the annual accounts on a going concern basis;

e) they have laid down proper internal financial controls to be followed by the Company and that such internal financial controls were adequate and operating effectively; and

f) they have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems were adequate and operating effectively.

Declaration by Independent Directors [Section 134(3)(d)]

All the Independent Directors of the Company have given declarations confirming that they continue to meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and are in compliance with Rule 6(3) of the Companies (Appointment and Qualifications of Directors) Rules, 2014 and Regulation 16(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Further, they have affirmed compliance with the Code of conduct laid down under Schedule IV of the Companies Act, 2013.

Opinion of the Board [Rule 8(5)(iiia) of Companies (Accounts) Rules, 2014]

The Board opines that all the Independent Directors of the Company strictly adhere to corporate integrity, possess the requisite expertise, experience and qualifications to discharge the responsibilities as an Independent Director as mandated by the Companies Act, 2013 and the Rules made thereunder and by the SEBI Regulations.

All the independent Directors of your Company have been registered and are members of the Independent Directors Databank maintained by the Indian Institute of Corporate Affairs (IICA). Four Independent Directors were already granted exemption from appearing for the Online Proficiency Self-Assessment test conducted by IICA. One Independent Director will appear for the online Proficiency Self-Assessment test before the due date.

Company’s policy on Directors’ appointment and remuneration and Criteria for determining qualifications, Positive Attributes and Independence of a Director [Section 134(3)(e)]

The Company has constituted a Nomination and Remuneration Committee which has been entrusted the responsibility of selecting and recommending the appointment and remuneration of Directors. The Committee while making appointments and fixing the remuneration of Directors will take into consideration the following:

a) their qualification

b) past record, especially their credentials and achievements, experience, past remuneration

c) job profile and suitability

d) comparative remuneration with the industry in line with the size and profits of the Company

e) their pecuniary relationship with the promoters.

Further, the Nomination and Remuneration Committee also, while recommending and appointing independent Directors will evaluate the following:

a) their qualification

b) credentials, past experience in the fields of finance, management, technology, taxation and other related fields

c) expertise in similar industry

d) confirmation from the Internal Auditors that there is no pecuniary relationship with the Company or other parties in terms of Section 149(6) of the Companies Act, 2013.

The terms and conditions for appointment of Independent Directors and the Code of Conduct of the Board of Directors and Senior Management Personnel are available on the Company’s website and can be accessed at https:// glandpharma.com/investors/corporate_governance

Audit Reports [Section 134(3)(f)]

The Independent Auditor’s Report on Standalone Financial Statements and Consolidated Financial Statements given by M/s. S.R. Batliboi & Associates, LLP, Statutory Auditors of the Company does not contain any qualifications, reservations or adverse remarks.

The Secretarial Audit Report issued by M/s. RVR & Associates, Company Secretaries does not contain any qualifications, reservations or adverse remarks.

The Company has undertaken an audit for the Financial Year ended March 31, 2022 for all applicable compliance as per the Securities and Exchange Board of India Regulations and Circulars / Guidelines issued thereunder. The Annual Secretarial Compliance Report issued by M/s. RVR & Associates, Company Secretaries was submitted to the Stock Exchanges within 60 days of the end of the Financial Year and the same is available on the websites of the Stock Exchanges and the Company and can be accessed at https://glandpharma.com/images/ SecretarialComplianceReportReg24A31032022.pdf

Frauds reported by Auditors [Section 134(3)(ca)]

The Statutory Auditors did not report any frauds during the financial year under review under Section 143(12).

Particulars of Loans, Guarantees and Investments [Section 134(3)(g)]

During the year under review, the Company did not extend any Loans or Guarantees as covered under the provisions of Section 186 of the Companies Act, 2013. The Company has further invested US$ 1,000,000/- (USD One Million) in its Wholly-owned Subsidiary incorporated in Singapore i.e., Gland Pharma International Pte. Ltd. The details are also provided in Note No.8 to the standalone financial statements.

Gland Pharma USA, Inc. a step-down subsidiary (Subsidiary of Gland Pharma International Pte. Ltd.) was incorporated in the US during the year under review.

The Company had deposited an amount of H2,000 Mn with HDFC Ltd during the year under review.

Particulars of contracts with Related Parties [Section 134(3)(h)]

The Company’s transactions with Related Parties are at arm’s length and were in the ordinary course of business only. The Company does not have any related party transactions, which may have potential conflict with the interests of the Company. All Related Party transactions have been reported in Notes to Accounts and do not cover under the provisions of Section 188(1) of the Companies Act, 2013 read with Rules made thereunder.

The details of the Related Party transactions were provided in Annexure D to this Report. The policy on materiality of Related Party transactions and on dealing with Related Party transactions as approved by the Board of Directors is available on the Company’s website and can be accessed at https:// glandpharma.com/investors/corporate_governance. Members may refer to Note 40 to the Standalone Financial Statement which sets out related party disclosures pursuant to Ind AS.

Research and Development

R&D is another focus area for Gland. Led by Dr. C.S. Venkatesan and Dr. S. Sridevi, each with over 2 decades of experience, Gland has a team of close to 300 scientists working in the areas of:

• Formulation Development

• Analytical Method Development

• API Process Development

• Stability Studies, etc.

Performance and Operations Review

During the year, the total income of the Company was H46,246.48 million as against H35,976.52 million during the previous year reflecting a growth of 28.55%.

Exports

Exports contribution to the revenue of the Company is approximately 80.30%. Your Company exports to almost 60 countries across 6 continents. During the year, the Company has achieved an export turnover of H35,206.32 Mn.

Domestic Operations

The Domestic sales during the year 2021-22 amounts to H8,635.13 Mn. Domestic sales include Co-Marketing, a major revenue source for your Company in the Domestic segment.

Taxation

The Company has made an Income Tax provision of H3,958.83 Mn for the period under review as against H3,394.46 Mn for the previous year.

Borrowings

The Company has no outstanding borrowings as on date of this Report. However, outstanding amount of Deferred Sales tax amounting to H39.33 Mn was classified as borrowings as per Indian Accounting Standards.

Capital Expenditure

During the year under review, the Company has incurred capital expenditure of H5,113.27 Mn at its manufacturing facilities at Dundigal, Pashamylaram, Shamirpet, VSEZ and Pharmacity and an amount of H107.92 Mn for purchase of other intangibles.

Share Capital

During the year under review, the Company has issued and allotted 7,09,800 fully paid-up equity shares to its employees under the Employee Stock Option Scheme, 2019. Consequently, the issued, subscribed and paid-up share capital of the Company was increased from H163,592,923/- (divided into 163,592,923 equity shares of H1/- each) to H164,302,723/- (divided into 164,302,723 equity shares of H1/- each). The equity shares issued under the Employee Stock Option Scheme, 2019 rank pari-passu with the existing equity shares of the Company.

General Reserve [Section 134(3)(j)]:

During the financial year under review, no amount was transferred to General Reserve.

Dividends [Section 134(3)(k)]

The Board of Directors does not recommend dividend for this year. The Company is in compliance with its Dividend Distribution policy as approved by the Board. In compliance with the requirements under Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015; the policy is annexed as Annexure A to this Report.

Material Changes and commitments [Section 134(3)(l)]

There were no material changes occurred or commitments made by the management from the end of the financial year till the date of this report, which may affect the financial position of the Company.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings & Out go [Section 134(3)(m)]

Particulars as required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 are provided as Annexure G to this Report.

Employee Stock Option Scheme

The Company has an Employee Stock Option Scheme, namely ‘Gland Pharma Employee Stock Option Scheme, 2019’ (ESOP Scheme, 2019) that helps the Company to retain and attract the right talent. The ESOP Compensation Committee administers the ESOP Scheme. There was no change in the ESOP Scheme during the year under review. The ESOP Scheme is in compliance with the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 (SBEB Regulations). Details of the Employee Stock Option Scheme-2019 have also been provided in Note No. 38 of the standalone financial statement. During FY 2021-22, no employee was issued options equal to or exceeding 1% of the issued share capital of the Company at the time of grant.

In compliance with the requirements of the SBEB Regulations, a certificate from Secretarial auditor confirming implementation of ESOP Scheme in accordance with the said regulations and shareholder’s resolution will be available electronically for inspection by the members during the annual general meeting of the Company and the same is available at https:// glandpharma.com/investors/investors_annual_report.

The details of stock options are as mentioned in Annexure H and forms part of this Report. Further, the details of this stock options stated in the notes to accounts of the financial statements also forms part of this annual report.

Risk Management [Section 134(3)(n)]

The Board of Directors of the Company has constituted a Risk Management Committee, which oversees the Enterprise Risk Management process. The Committee shall meet as and when required and atleast twice in a year. The Audit Committee has additional oversight in the area of financial risks and controls.

The Company has formulated a Risk Management policy. Risks are classified in different categories such as Financial, Operational, Legal and Strategic risks. These risks are reviewed from time to time and controls are put in place with the specific responsibility of the concerned Officer of the Company. However, the Board could not identify any major risks, which may threaten the immediate existence of the Company.

Corporate Social Responsibility [Section 134(3)(o)]

The Company had constituted a ‘Corporate Social Responsibility Committee’ to decide upon and implement the Corporate Social Responsibility Policy (CSR policy) of the Company.

The brief outline of the Corporate Social Responsibility (CSR) policy of the Company and the initiatives undertaken by the Company on CSR activities during the year are set out in Annexure- E to this Report in the format prescribed in the Companies (CSR policy) Rules, 2014.

The Corporate Social Responsibility policy of the Company can be accessed at https://glandpharma.com/investors/ corporate_governance

Board Evaluation [Section 134(3)(p)]

The evaluation of all the Directors including the Chairman, the MD & CEO and the Board as a whole was carried out based on the criteria and framework approved by the Nomination and Remuneration Committee. A detailed disclosure on the parameters and the process of Board evaluation as well as the outcome has been provided in the Report on Corporate Governance.

The policy on evaluation of Independent Directors and Directors of the Company can be accessed at https:// glandpharma.com/investors/corporate_governance

Nature of business [Rule 8(5)(ii) of Companies (Accounts) Rules, 2014]

Gland Pharma is engaged in the development, manufacture, sale and distribution of Pharmaceuticals. There was no change in the nature of the business of the Company during the financial year under review.

Directors

During the year under review, the following are the changes made in the constitution of the Board of Directors of the Company.

(i) Pursuant to the provisions of Sections 149,150 and 152 of the Companies Act, 2013 and the recommendation of the Nomination and Remuneration Committee, the Board of Directors appointed Ms. Naina Lal Kidwai as an Additional Director and Independent Director for a period of five years on 17^th May, 2021. The Members of the Company had approved the appointment of Ms. Naina Lal Kidwai as an Independent Director (change in designation from Additional Director to Director) in the Annual General Meeting held on 26^th August, 2021, through e-voting.

(ii) Pursuant to the provisions of Sections 149 and 152 of the Companies Act, 2013 and the recommendation of the Nomination and Remuneration Committee, the Board of Directors appointed Dr. Allen Zhang as an Additional Director on 17^th May, 2021. The Members of the Company had approved the appointment of Dr. Allen Zhang as a Director liable to retire by rotation (change in designation from Additional Director to Director) in the Annual General Meeting held on 26^th August, 2021, through e-voting.

(iii) Pursuant to the provisions of Sections 149 and 152 of the Companies Act, 2013 and the recommendation of the Nomination and Remuneration Committee, Mr. Yao Fang was appointed as additional Director on 10^th March, 2022. The Members of the Company approved appointment of Mr. Yao Fang as Non-Executive Director (change in designation from Additional Director to Director) through Postal Ballot on 20^th April, 2022.

(iv) Mr. Dongming Li resigned as Director with effect from 10^th March, 2022 consequent to his decision to peruse better opportunities outside Fosun Pharma. He confirmed that there were no other material reasons for his resignation.

(v) Mr. Srinivas Sadu was re-appointed as Managing Director and CEO of the Company for a further period of 5 (five) years with effect from 25^th April, 2022 to 24^th April, 2027, through Postal Ballot on 20^th April, 2022.

Key Managerial Personnel: There was no change in the Key Managerial Personnel during the year under review.

Subsidiaries and Associates [Rule 8(5)(iv) of Companies (Accounts) Rules, 2014]

During the year under review, Gland Pharma International Pte. Ltd., a Wholly-owned Subsidiary of the Company has incorporated a wholly subsidiary company ‘Gland Pharma USA Inc.’ in USA on 7^th March, 2022.

Gland Pharma Limited is a subsidiary of Fosun Pharma Industrial Pte. Ltd., a Singapore Company, which holds approximately 58.00% of the shareholding in Gland Pharma Limited.

Details of the subsidiary are set out as Annexure B to this Report. Pursuant to Section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014; a statement containing salient features of the financial statement of the subsidiary in Form AOC-1 is provided as Annexure C to the Directors’ Report. The consolidated financial statements presented in this annual report include financial results of the subsidiary.

Copies of the financial statements of the subsidiary are accessible at https://glandpharma.com/investors/financials

Deposits [Rule 8(5)(v) of Companies (Accounts) Rules, 2014]

The Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014. There are no unpaid or unclaimed deposits as the Company had never accepted deposits within the meaning of the Act and the rules made thereunder.

Significant and Material Orders [Rule 8(5)(vii) of Companies (Accounts) Rules, 2014]

No significant or material orders were passed by the regulators or courts or tribunals which could impact the ‘going concern’ status and the future operations of the Company.

Internal Financial controls [Rule 8(5)(viii) of Companies (Accounts) Rules, 2014]

The Company appointed M/s. Y. Raghuram & Co., Chartered Accountants as Internal Auditors of the Company. The Company has laid down an adequate system of internal controls, policies and procedures for ensuring orderly and efficient conduct of the business, including adherence to the Company’s policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial disclosures.

The current system of internal financial controls is aligned with the statutory requirements. Effectiveness of internal financial controls is ensured through management reviews, controlled self- assessment and independent testing by the Internal Audit team.

Maintenance of Cost records [Rule 8(5)(ix) of Companies (Accounts) Rules, 2014]

The Company has been maintaining Cost records as required under the provisions of the Companies Act, 2013.

Disclosure under The Sexual Harassment of WomenatWorkplace(Prevention,Prohibitionand Redressal) Act, 2013 [Rule 8(5)(x) of Companies (Accounts) Rules, 2014]

The Company has in place a policy on Prevention, Prohibition and Redressal of Sexual Harassment at Workplace in line with the requirements of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. The policy has set guidelines on the redressal and enquiry process that is to be followed by complainants and the ICC, whilst dealing with issues related to sexual harassment at the work place. All women employees (permanent, temporary, contractual and trainees) are covered under this policy.

The Company has received three complaints during the year and appropriate action was taken against the accused. There are no pending complaints as at the end of the financial year.

Proceedings pending under the Insolvency and Bankruptcy Code, 2016 [Rule 8(5)(xi) of Companies (Accounts) Rules, 2014]

No application has been made or any proceeding is pending under the Insolvency and Bankruptcy Code, 2016.

Difference in Valuation [Rule 8(5)(xii) of Companies (Accounts) Rules, 2014]

The Company has never made any One Time Settlement against the Loans obtained from Banks and Financial institutions and hence this clause is not applicable.

Statement of deviations or variations [Regulation 32(4) of SEBI LODR]

The proceeds from the Initial Public Offer of the Company have been utilized for the purposes for which the proceeds were raised and there were no deviations or variations thereunder. The Company has been filing the Monitoring Agency Reports issued by Axis Bank Limited, on a quarterly basis, with the Stock Exchanges on which the Company’s shares are listed.

Management Discussion and Analysis Report

The Management Discussion and Analysis Report for the year under review, as required under Regulation 34 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is presented in a separate section in this Report.

Business Responsibility Report

Pursuant to Regulation 34 of The Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015; the Business Responsibility Report (BRR) is presented in a separate section in this Report.

Vigil Mechanism [Section 177(9) and 177(10)]

The Company, as required under Rule 7 of Companies (Meetings of Board and its Powers) Rules, 2014, has established a Vigil Mechanism for its Directors, employees and other stakeholders to report their genuine concerns or grievances either in writing or by email to the Chairman of the Audit Committee.

The Audit Committee of the Company shall oversee the vigil mechanism, which provides for adequate safeguards against victimisation of employees and Directors who avail of the vigil mechanism.

All the employees and Directors of the Company are provided direct access to the Chairman of the Audit Committee.

Secretarial Standards

The Company has complied with the applicable Secretarial Standards i.e., SS-1 and SS-2, relating to ‘Meetings of the Board of Directors’ and ‘General Meetings’, respectively.

Statutory Auditors

M/s. S.R. Batliboi & Associates, LLP, Chartered Accountants, Hyderabad were appointed as Statutory Auditors of the Company to hold office from the conclusion of the 40^th Annual General Meeting to the conclusion of the Annual General Meeting for the financial year 2022-23.

Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Rules made thereunder, the Company has appointed RVR & Associates, Company Secretaries to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed as Annexure-F to this Report.

a) Audit Committee [Section 177]

The primary objective of the Audit Committee of the Company is to monitor and provide effective supervision of the management’s financial reporting process with a view to ensure accurate, timely and proper disclosures and the transparency, integrity and quality of financial reporting.

The Audit Committee will review periodically the internal control systems, scope of audit including the observations of auditors, if any and review the half yearly and annual financial statements before submission to the Board and also ensures compliance with internal control system.

The terms of reference of the Committee are wide enough to cover matters specified for Audit Committees under Section 177 of the Companies Act, 2013.

During the year under review, the Audit Committee met four times on 17^th May, 2021; 21^st July, 2021; 22^nd October, 2021 and 21^st January, 2022.

Mr. Srinivas Sadu, Managing Director & CEO, Mr. Ravi Shekhar Mitra, CFO and Mr. Wu Rong, Financial Controller of the Company are the Special invitees to every Audit Committee Meeting.

b) Nomination and Remuneration Committee [Section 178]

The purpose of the Remuneration Committee of the Company shall be to discharge the Board’s responsibilities relating to remuneration of the Company’s Executive Directors. The Committee has overall responsibility for formulating the criteria for determining qualifications and independence of a Director and recommends to the Board a policy relating to the remuneration for the Directors, Key Managerial Personnel and other employees.

During the year under review, the Nomination and Remuneration Committee met three times on 14^th May, 2021, 20^th July, 2021 and 10^th March, 2022.

c) Corporate Social Responsibility (CSR) Committee [Section 135]

The Company has constituted the ‘Corporate Social Responsibility Committee’ for formulating and recommending to the Board of Directors a Corporate Social Responsibility Policy for the Company, which shall indicate the activities to be undertaken by the Company as specified in the Companies Act, 2013 and the rules made thereunder.

The Corporate Social Responsibility Committee recommends the amount of expenditure to be incurred by the Company on CSR activities and monitor the Corporate Social Responsibility Policy of the Company from time to time.

During the year under review, the Corporate Social Responsibility Committee met two times on 14^th May, 2021 and 16^th March, 2022.

d) Stakeholders’ Relationship and Share Transfer Committee

The Company has constituted the ‘Stakeholders’ Relationship and Share Transfer Committee’ for resolving the grievances of the security holders of the Company including complaints related to transfer / transmission of shares, non-receipt of annual report, non-receipt of declared dividends, issue of new/duplicate certificates, notice for general meetings, etc. and for review of measures taken for effective exercise of voting rights by shareholders.

During the year under review, the Stakeholders’ Relationship and Share Transfer Committee met four times on 14^th May, 2021; 20^th July, 2021; 22^nd October, 2021 and 21^st January, 2022.

Composition and attendance of Stakeholders’ Relationship and Share Transfer Committee

e) Risk Management Committee

The Company has constituted the ‘Risk Management Committee’ for fulfilling the Board of Directors’ corporate governance oversight responsibilities with regard to the identification, evaluation and mitigation of strategic, operational, and external environment risks. The Committee shall undertake an overall responsibility for monitoring and approving the enterprise risk management framework and associated practices of the Company.

During the year under review, the Risk Management Committee met three times on 20^th July, 2021; 05^th January, 2022 and 04^th March, 2022.

Composition and attendance of Risk Management Committee

Details of remuneration to Executive Directors and KMPs

( H in million)

*Others include special bonus and stock options granted during FY 2019-20. which were vested over a period of 3 years. # Others include Stock options granted during FY 2019-20 which were vested over a period of 3 years

Non-Executive Directors

The Company does not pay any remuneration to Non-Executive Directors.

Independent Directors

The Independent Directors of the Company would be paid Commission on the profits of the Company, apart from Sitting fee for attending the Board Meetings. The details of the remuneration paid to the Independent Directors are as follows:

( H in million)

Corporate Governance

In compliance with Regulation 34 read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015; a separate report on Corporate Governance for the year under review is included as a separate section of this Report.

A certificate from M/s. RVR & Associates, practicing Company Secretaries confirming compliance with the conditions of corporate governance, as stipulated under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed to the Report on Corporate Governance.

Human Resources

The Company continues to have cordial and harmonious relationship with its employees. Information required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided in Annexure.I.1 to this report.

Information required under Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and Rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel), Rules, 2014 is provided in Annexure I.2 to this report. In terms of the provisions of Section 136 of the Act, the Annual Report is being sent to members excluding the aforementioned information. The information will be available on the website of the Company at https://glandpharma.com/investors/investors_annual_report

Acknowledgements

Your Directors gratefully acknowledge the continued support, co-operation and wise counsel extended by the Government Authorities, Banks and Financial Institutions.

Your Directors place on record their sincere appreciation for the significant contribution made by the employees through their dedication, hard work and commitment.

Your Directors sincerely acknowledge the confidence and faith reposed in the Company by the Shareholders, Medical Profession & trade and other stake holders.