Utmost Concern - Imexpharmbctn2014.imexpharm.com/download/Imexpharm-SR14-en2014.pdf · 2015. 8. 17. · Health & Safety is of the Utmost Concern SUSTAINABILITY REPORT 2014 IMEXPHARM

Health & Safety is of the

Utmost ConcernSUSTAINABILITY REPORT 2014

IMEXPHARM CORPORATIONNo. 4, 30/4 Street, Ward 1, Cao Lanh City, Dong Thap ProvinceTel: (84.67) 851941 - Fax: (84.67) 853016Email: [email protected]: www.imexpharm.com

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02 Message from the Chairman of the BOD04 Overview of Sustainability Report 201404 Summary04 Contact Details

05 Impacts, Risks and Opportunity Analysis05 Impact of Imexpharm for Sustainable Development06 Risks & Opportunities on Environmental of Sustainable Development for Imexpharm07 Strategies and Objectives of Sustainable Development 09 Imexpharm Overview12 Corporate Governance 14 Overview of Sustainable Development18 Towards a Green Environment18 Consuming Sustainable Energy19 Water is the Heart of Sustainable Development20 Emissions20 Regular Monitoring Emissions22 Efficient Management of Waste & Wastewater26 Waste28 Total Cost and Investment for Environmental Protection28 Efficient Management of Production Conditions

29 Local Human Resource and Economic Development30 Safety and Hygiene in Production 35 Customers’ Health and Safety is of Utmost Concern35 Strict Quality Management System36 Enhancing Safety and Health for Consumers37 Socially Responsible Product “Pure Antibiotics”38 Employees and Sustainable Development41 Corporate Social Responsibility Practice in 201443 GRI G4 Reference47 Appendix 1 and Questionnaire

TABLE OF CONTENTS

SUSTAINABILITY REPORT 2014 32

Dear Fellow Shareholders,

Our lives are being exposed to serious health risks including work stress, nutritional imbalance, extreme weather, unhealthy food, environmental pollution, etc. Recent evidence shows that diseases based on seasons, occupation and non-communicable chronic symptoms are increasing rapidly. The generation enjoying their golden years is rapidly growing older and soon a younger population will face the problem of an aging population in the next ten or fifteen years. Statistics now show that the elderly now live about ten years longer while suffering from disease. On average, elderly Vietnamese citizens have 2.6 kinds of different disease, and only 6% of the elderly have the healthy lives (Ministry of Health, 2012). This has negative effects on the sustainable development of the whole society.

Undertaking a mission of providing effective solutions to the community healthcare, in addition to improving product lines meeting treatment requirements for the stage of complex and unpredicted development of diseases in Vietnam, Imexpharm has worked diligently to bring free medical care to remote areas of the country. We have served thousands of people each year, mostly the elderly and young children, with an in-depth understanding of the burden they are forced to bear as a result of disease.

Besides help and support in our knowledge and specialized, we have carried out programs of educational promotion and talent support in order to encourage learning in the community. Our desire, which is expressed in the campaign “Change”, is aimed at changing people’s lives, their future and making their dreams come true.

Dear all,

We are a pharmaceutical production company and we always make the environment, consumers’ health and safety, and socially responsible products our top priorities. These are also of great concern to our major providers, according to a survey in 2014. In addition, the contribution to Imexpharm’s local development and community service activity attracts attention from all people concern. Besides meeting development requirements, human resources are a priority. And as a result we are working to build a positive working environment and creating sustainable jobs.

However, to foster the true “sustainability”, we must make every effort in the journey ahead. Although we have great confidence in production environment and quality, Imexpharm needs to continue improving by raising standards belonged to manufacturing plants in Binh Duong to meet EU-GMP standards. We are expecting to receive

certification in the second quarter of 2016. Together with upgrading our factories, we have also launched a host of new products to meet the demands of healthcare and treatment. 2015 is also the year of “Human Resource Development.” We will strive to create changes in performance, develop the next generation, build a professional, effective and dynamic working environment and a result-oriented culture to attract and support talents. Imexpharm is also considering about replacing out dated equipment and investing in new machines to save energy.

In 2014, we placed key shareholders in the right position in order to contribute their opinions and consult to the sustainable development and improve our operation. I would like to extend our heartfelt thanks to you for your interest in our Sustainable Development Program and we hope to receive valuables from you to continue our sustainable development.

Undertaking a mission of providing effective solutions to the community healthcare, in addition to improving product lines meeting treatment requirements for the stage of complex and unpredicted development of diseases in Vietnam, Imexpharm has worked diligently to bring free medical care to remote areas of the country.

MESSAGE FROMTHE CHAIRMAN

Chairman of the BOD,

NGUYEN QUOC DINH


IMPACTS, RISKS AND OPPORTUNITY ANALYSIS OVERVIEW OF SUSTAINABILITY REPORT 2014

In 2014, Imexpharm continued to include its Sustainability Report within its Annual Report, positioned as an integral part of the overall picture. The Sustainable Development Report 2014 with the title “Health and Safety is of the Utmost Concern” depicted Imexpharm’s key activities relating to sustainable development such as environmental protection, labor health and safety, consumers’ health and safety, socially responsible products, development of local human resources and economics, and other social responsibility activities.

Imexpharm’s 2014 Sustainability Report was produced according to GRI-G4 standards. The period for the report ends on 31 December 2014 (at the same time as the Annual Report 2014) The report is produced annually, and either integrated in the Annual Report or presented separately.

CONTACT DETAILS

Your input is welcome regarding Imexpharm’s sustainable development, please contact:

Mr. Tran The Hao – PR Manager – Head of Sustainable Development Committee.Cell phone: 0909 907 989Email: [email protected]

Ms. Nguyen Thi Kim Le – Vice Chair of Internal Auditing Committee – Vice head of Sustainable Development Committee.Cell phone: 0982 907 818Email: [email protected]

IMPACT OF IMEXPHARM ONSUSTAINABLE DEVELOPMENT

IMPACT OF IMEXPHARM ON SUSTAINABLE DEVELOPMENT

Vietnam’s pharmaceutical industry is still relatively young. According to the classification of the World Health Organization (WHO) and the United Nations Conference on Trade and Development (UNCTAD), Vietnam is ranked 3 out of 4 on the pharmaceutical industry development scale. This means that domestic pharmaceutical companies can manufacture genetic drugs and export variant pharmaceuticals products in comparison with countries with the highest rank 4/4 on the scale that can produce ingredients and invent new drugs. The domestic industry can produce only low-value generic medicines at a proportion of less than 50% of the spending on drugs in Vietnam (the figure was 46% in 2014), the rest must be imported, especially high value treatment drugs. The Vietnamese, on average, spend only over 30 USD per person per year in medicines while the figures were 96 USD in other developing countries and 186 USD worldwide.

Being one of the top five pharmaceutical groups in Vietnam, through business and community activities, Imexpharm has made great contributions to the following fields:• Impacts on development of community and society • Impacts on development of pharmaceutical industry

and Vietnamese economy• Impacts on environment

Impacts on development of community and society:• Creating more stable jobs for more than 1,000

employees and enhancing their knowledge on sustainable development.

• Production responsibility: Increasing the availability of effective and safe medicines, enhancing the spirit of protecting health in community.

• Sharing the burden of disease: improving access to health care and medicines free of charge to people in remote and isolated areas.

• Fostering learning spirit in society through programs of educational promotion and talent support.

Impacts on development of the Pharmaceutical Industry and Vietnamese economy • Contributing to the development of Vietnam’s

pharmaceutical industry: Imexpharm is a pioneer in the industry, producing high quality products with state-of-the-art production lines. Imexpharm contributes to enhancing the pharmaceutical manufacturing level in Vietnam.

• Contributing to the development of local economy: through paying taxes to the local government, creating jobs for local labors, and community programs such as: Happy Tet holiday for the poor, house funding for the poor, etc.

• Pioneering in implementing state policies: Imexpharm is the first pharmaceutical company in Vietnam Pharmaceutical Corporation to implement its equalization in 2001 and is the first pharmaceutical company in Vietnam to have its stocks listed on the HCM City Stock Exchange in 2006.

Environmental Impacts• Reducing damage to the environment by investing in

high quality production equipment. • Carrying out training programs to engage staff in

behaviors of saving water and energy, reducing the amount of energy used by managing production suitably.

• Strictly adhering to the environmental protection regulations

4

6 SUSTAINABILITY REPORT 2014 7

RISKS AND OPPORTUNITIES OF SUSTAINABLE DEVELOPEMNT CONTEXTAND TREND FOR IMEXPHARMRisks• Mass health insurance puts priority on using cheap drugs, which has negative

impacts on the outcome of treatment, citizens’ health and the development of the pharmaceutical industry in Vietnam, including companies focusing on high quality like Imexpharm.

• OTC market which accounted for only 30% compared to 70% ETC in total drug spending in 2014, was a playground for many highly – invested pharmaceutical companies, so there is a serious competition.

• Awareness of sustainable development in community is low, which poses challenges for Imexpharm in implementing sustainable development strategies.

Opportunities• There is an upward trend in using generic drugs around the world, so many

multinational pharmaceutical corporations are focusing on this segment. Due to the cheap price of generic drugs, treatment is cheaper and evidence from clinical trials shows that the effectiveness is equal to that of original drugs.

• The state’s strategies give privilege to the local pharmaceutical industry, creating development opportunities for domestic pharmaceutical companies.

• Vietnam has a large population and the awareness of healthcare is increasing among citizens due to increasing living standards. However, drug spending of Vietnamese people on average is still low. Therefore, the potential market for pharmaceutical industry is still very large.

• Seasonal diseases, occupational diseases and non-communicable chronic diseases are increasing rapidly due to environmental pollution, climate change, food insecurity and work related stress.

• The population is aging and the diseases of the elderly are increasing: We will face an aging population in the next 15-20 years as the number of elderly patients continues to increase.

• Enhance Imexpharm’s brand reputation, which is associated with “trust” when implementing sustainable development strategies.

Strategies for Sustainable Development “Imexpharm develops sustainably together with the community” is the 2014 - 2015 company strategy. To well implement this strategy, the company has set specific targets to organize effective implementation throughout the company.

(Please see also Shareholders’ Commitments in the Annual Report/Imexpharm’s Overview/ Sustainability Strategies)

Imexpharm determined that the company will be only able to develop sustainably if the objectives of economic development are in alignment with the objectives of the environment and society. Specifically as follows:

STRATEGIES AND OBJECTIVESFOR SUSTAINABLE DEVELOPMENT

Sustainable economic efficiency

Building a sustainable

society

Maintaining environemnt

Imexpharm’s Sustainable Development Model

Develop new products, special treatment products to replace

high cost imported drugs, reducing the cost of treatment

Added value forshareholders,

consumers & partners

Contribution tolocal economy

Sustainable economic efficiency

To achieve social objectives, the company focuses on the

following 3 aspects:

Policies and benefits packages for employee

Social responsibility

practice

Community development

committee

Building a sustainable

society

To achieve Economic Efficiency, Imexpharm focuses on the

following 3 aspects:


Sustainable Development ObjectivesImexpharm’s sustainable development objectives moving toward 2017 are as follows:

• Environment: Implementing energy and water saving in daily life and production practices. Meeting the requirements of the Energy Audits with the budget allocated to reduce power consumption. Further improving the standards of production to minimize damage to the environment.

• Community and Society: Continuing to implement and replicate access to free medical care and medicines for the underprivileged in remote areas. Increasing the budget for the financial support for educational promotion to encourage and build a learning centric society, while contributing to the development of human resources of the whole country.

• Products: Developing special treatment products in alignment with disease developments in Vietnam to replace imported high-priced drugs, developing high quality functional food and protecting the community health. Towards 2017, all key products must be tested via bio-equivalence or clinical trial to evaluate the impacts and effectiveness for the safety and health of users.

• Labor: Building up the satisfactory wages, bonuses, and benefit packages. Developing good working environment with unique culture, training and developing future generations, developing a clear mechanism for promotion through building detailed descriptions of positions in the company, with a staff retention rate of over 90%.

IMEXPHARM OVERVIEW

Imexpharm Pharmaceutical Joint Stock Company is a proud pi-oneer in the Vietnamese Pharmaceutical Industry with over 30 years of history.

(For more details about Imexpharm, please see also the Annual Report/ Overview of Imexpharm:

Introduction Fields and Locations for business Vision – Mission – Core values Over 30 -year- experience in community healthcare services

For Imexpharm’s business index, please see the Annual Report/ Message/ Business index in the period 2010 -2014)

2014 Targets

To achieve environmental objectives, the company focuses on the following three activities:

Follow good practices in pro-duction to minimize negative

environmental impact

Promote action plans to protect the

environment

Enhance product innovation, using environmentally

friendly materials

Maintain a sustainable

environment

Contents Targets

Staff as of 31 December 2014

962 persons

Net revenue 897.1 billion VND

Total capital 1,029.5 billion VND

Payables 232.9 billion VND

Equity 796.6 billion VND

Products Approximately 300 products

STRATEGIES AND OBJECTIVES FOR SUSTAINABLE DEVELOPMENT (continued)

8


Antibiotic group, which were the major product, accounted for 49% of Imexpharm’s total revenue.

Imexpharm operates only in Vietnam; the main region being the Mekong Delta, which accounts for 50% of total revenue.

2014 Imexpharm Main Product Categories and Main Operations

Revenue proportion OTC:ETC 2012 - 2014

Through December 31, 2014, Imexpharm is headquartered in Cao Lanh City, Dong Thap province with 2 representative offices in Hanoi and Ho Chi Minh City, 19 nationwide agencies, and more than 40 distribution partners.

In 2014, the company established one agency in Ho Chi Minh City and bought land to build other branch offices. In the same year, the company also issued shares to increase its charter capital from 167.06 billion VND to 263.12 billion VND.

The company has the long-term suppliers providing stable and high quality raw materials.

The company do not issue the Consolidated Financial Statement due to the dependent financing from branches.

Antibiotics

49%

11%

9%

18%

6%7%

Digestive system, liver and bileRespiratory systemAni-inflammation - AcesodyneVitaminsOthers

IMEXPHARM OVERVIEW (continued)

Imexpharm’s Flagship Products

57%

43%

40%

60%

20%

80%

100

80

60

40

20

2012 2013 20140

OTC ETC

Total revenue from OTC (drug stores, agencies, etc.) and ETC (hospitals)

REVENUE - PRODUCT GROUPS

REVENUE - GEOGRAPHIC AREAS

(IMEXPHARM PRODUCTS)

Mekong DeltaHo Chi Minh CityThe SoutheastThe Central HighlandsThe North

50%

10.3%

12.2%

15.1%

12.3%

These brands account for over 30 main products with different manufacturing technologies and contents, by 10% of the product line and 65% of total revenue.

10


CORPORATE GOVERNANCE

(Please see the following contents in the Annual Report/ Imexpharm’s organizational structure)

• Organizational Chart, List of Branches and their Addresses• About the Board of Directors • About the Board of Executive • About the Board of Supervisory• Senior Executive Replacement 2014

CORPORATE GOVENANCE FOR SUSTAINABLE DEVELOPMENTImexpharm Sustainable Development Organizational Chart: The Board of Directors develop sustainable development strategies and objectives in the short, medium and long term for implementation by the Board of General Management.

The Board of General Management is responsible to the Board of Directors on issues of sustainable development, while ensuring the sustainable development strategies and objectives of the Board are implemented effectively.

The Sustainable Development Committee answers to the Board of General Management on issues of sustainable development, applying strategies and objectives to functional departments and ultimately, Imexpharm’s staff.

Full Name PositionPosition in Sustainable

Development CommitteeTasks

Tran The Hao PR Manager Head of Committee • Overall responsibility for issues of sustainable development and sustainable development reports

• Responsible for community activities and responsible products• Build up a mechanism for receiving comments from shareholders

Phan Hoang Minh Tri Assistant Chairman Member • Develop management practices for the issues of sustainable development

• Responsible for the economic efficiency of sustainable development.• Develop a mechanism for dealing with complaints about sustainable

development

Le Minh Tri PR staff Member • Assist in Community Activities and Responsible Products• Responsible to evaluate the sustainable development issues of

suppliers

Nguyen Kiem Phuong President of Trade Union,Head of Culture Committee,Member of the Board of Directors

Member • Responsible for sustainable jobs, employee rights and occupational health and safety.

Ngo Minh Tuan Head of Strategy and Development Committee, General Director Assistant

Member • Assist in management practices for issues of sustainable development

• Assist in evaluating supplier on sustainable development issues

Duong Hoang Vu Deputy Head of Department of Finance & Accounting

Member • Assist in the economic efficiency of sustainable development

Nguyen Quoc Hung Head of Technical Support Department

Member • Responsible for environmental sustainable development• Assist in occupational health and safety for employees.

Tran Thi To Nu Personnel Manager Member • Responsible for labor relations, jobs, compensation, training and development

Do Thi Thanh Thuy Head of Internal Auditing Member • Assist in building management practices for the issues of sustainable development

• Auditing the sustainable development system

Nguyen Thi Kim Le Deputy Head of Internal Auditing

Vice Head of Committee • Responsible for collecting data for annual sustainable development report.

• Editing the content for the annual sustainable development report

In 2014, Imexpharm established the Sustainable Development Committee consisting of the following members:

Leadership in sustainable development- Mr. Nguyen Quoc Dinh – Chairman of Board of Directors, Deputy General Director: is responsible for managing the implementation of sustainable

development strategies and objectives in Administrative and Sales Departments (efficiency in operation and water and energy consumption, job arrangement, welfare policies for employees, training, and development etc.); he is also responsible for overall management in sustainable development and publicizing news.

- Mr. Huynh Van Nhung – Member of the Board of Directors, Deputy General Director: is responsible for managing the implementation of sustainable development strategies and objectives in Production Departments (relevant to environmental issues in manufacture: capacity, water, emissions, waste, waste water, labor health and safety, product liability, as well as interviewing suppliers about sustainable development issues).

Board of Directors

Board of Executive

SustainableDevelopment Committee

FunctionalDepartments

Staff

12


SCOPE AND BOUNDARIESThis report was prepared within Imexpharm’s scope of operation and full cooperation of all its branches.

Reports on environment, safety and occupational health are related to Imexpharm’s two main production plants named Plant and Warehouse in Cao Lanh City and plant and warehouse at Branch 3 - Binh Duong Province.

All other areas are reported within the framework of the operation of the company in 2014.

STANDARDS The report is produced with reference to the guidelines of the Global Reporting Initiative (GRI), Guidelines 4, and the industry of pharmaceutical chemistry. The contents presented in the Annual Report according to GRI were: General information about the company, Organizational structure, Corporate governance, Employee structure, Policies for employees, and Training and career development.

CONNECTING AND CONSULTING SHAREHOLDERSIdentify Shareholders:Imexpharm identified key shareholders by considering the degree of influence and the degree of dependence of the parties to Imexpharm. The matrix identifying the key stakeholders of Imexpharm is as follows:

- Manufacturing and Distribution Partners: Via email, Imexpharm sent the Open letter and survey questionnaire on issues of sustainable development to partners.

- Drug stores/Hospitals: Imexpharm met and interviewed some VIP customers through Imexpharm’s Claminat Festival and refer to results from the annual surveys of customer satisfaction.

- Local communities: Imexpharm collected information from local unions through social and community activities

Consultation Outcome:Responses and comments of shareholders are synthesized and ranked in accordance with the level of interest. Accordingly the issues receiving the most concern are:

• Contribution to local development from the values directly generated and distributed

• Operation with the involvement of the community• Energy, water, waste and emissions within production• Safety and health for consumers• Socially responsible products

• Connecting and Consulting Shareholders:Imexpharm chose important representatives from among key shareholders who were identified to consult about issues of Imexpharm’s sustainable development. The key contents selected for reporting are based on aggregated results based on the level of interest of both Imexpharm and the stakeholders.- Employees: The Company asked the Trade Union

to send an Open letter and Survey questionnaires regarding concerns about sustainable development to middle and senior managers via Email. The report was also built with reference to the results of the periodic internal satisfaction evaluation of the company’s trade union.

- Shareholders: Sent an Open letter and Survey questionnaires to Leaders of Vietnam Pharmaceutical Corporation and some other large shareholders. Imexpharm also received comments and feedback from other shareholders and investors through IR Department.

- Local Government: Had an in person interview with Mr. Doan Tan Buu, Vice Director of Health Department in Dong Thap Province, and sent emails including the Open letter and questionnaires to Provincial leaders. Imexpharm also noted comments from other governors through the Annual General Meeting of Shareholder.

- Suppliers: Sent questionnaires to suppliers on bidding list

OVERVIEW ONSUSTAINABILITY REPORT

Employees

LocalGovernment

Shareholders

LocalCommunity

Customers(Drugstores,

hospitals)

Partners/Distributers

Providers

High

High Low

Level of dependence to

the company

Local community

Shareholders Employees Partners/

Distributers

LocalgovernmentCustomersProviders

Level of Influence to the company

14


In addition, shareholders are also interested in issues such as: labor health and safety, sustainable jobs, welfare and training and development for employees.

Stakeholder representatives also had many other ideas to help Imexpharm further its sustainable development initiatives. Some typical comments are quoted as follows:

IDENTIFYING KEY AREASFOR REPORT CONTENT

The shareholders’ consultations contributedgreatly to the report.

Thus, Imexpharm’s Sustainability Report 2014 will present important areas where the company, society, and communities are highly interested.

OVERVIEW ONSUSTAINABILITY REPORT (continued)

“Imexpharm needs to adopt measures to handle waste which causes environmental pollution

from its production units. Liquid and solid waste should be controlled to minimize pollution. The company

should produce more drugs for the elderly and young children to facilitate help doctors prescribe

appropriate medication”- Mr. Doan Tan BuuVice Director of Health Department in Dong Thap Province“Imexpharm will

continue to develop products sustainably

and professionally with in-depth investment in

high quality products…”- Mr. Nguyen Quy Son Chairman of Board of Directors - Vietnam Pharmaceutical Corporation – Member of Board of Directors of Imexpharm

“The prices of antibiotics must be reduced to compete

with other products. This will make advantages for

patients using medicines and pharmaceutical products of

the Company”- Doctor Le Phuoc Hai agency at 416 Hiep Hoa Ward,Duc Hoa District, Long An Province

Summary of key aspects taking high rate of interest from Imexpharm and associated parties:

Steps to identify content:Step 1: Consider the context of sustainable development of the economy, the pharmaceutical industry and ImexpharmStep 2: Identify key areas for ImexpharmStep 3: Synthesize the areas on which stakeholders put greater emphasisStep 4: Compare the key areas which are important to company and to related parties. Assess the level of importance and influence, the ability of the company to control these areas.Step 5: Selecting the key areas to be included in the report

High

HighLow

Importance to community

and society

Localdevelopment

Community activities

Environment Energy, water, waste

wage, emission)

Socially responsible products

Labor safety

JobsEducation and

training

Importance to the Company

16


CONSUMING SUSTAINABLE ENERGY WATER IS THE HEART OF SUSTAINABLE DEVELOPMENT

Unit 2013 2014

DO oil liters 109,700 113,915

Output million units (pill/pack)

1,013.5 1,222.2

Rate liters per million units

108 93

Electricity Consumption per Unit

(Converted figures in Report of Energy Auditing 2012)

Target Unit 2013 2014

Electricity Kwh 5,362,596 6,120,527

Output million units (pill/pack)

1,013.5 1,222.2

Rate Kwh/ million units

5,291 5,008

Energy saving is the first priority in Imexpharm’s production and operation. Saving energy lowers production costs, operating costs, and increases competitiveness, while contributing to environmental protection.

DO Oil Consumption per Unit

One third of the world’s population suffers from water shortage. This figure is expected to double by 2025. Water is the essence of life. “Water and Sustainable Development” is the theme of World Water Day in 2015, annually held on March 22 to call attention to the importance of water resources and advocating for the sustainable management of water resources, especially freshwater resources.

In 2014, Imexpharm streamlined production, and organized mass production lots to reduce turns of machine cleaning, reducing water consumption by 4,334 m3 equivalent to 8.7%. The rate of water used on million units decreased from 48.9 m3 per million units to 37.0 m3 /per million units, a reduction by 24.3%.

RECYCLED AND REUSED WATER

Recycled and reused water was wastewater mainly from RO in the pure water treatment system. The amount of wastewater recycled for irrigation and for cooling is about 10m3 per day out of a total 125m3 of water used per day.

M % recycled water = 10/125 = 8%.

The company measured the amount of water used based on flow meter readings installed on the system.

Imexpharm uses tap water from a water supply company. Water consumption recorded for the plant in Cao Lanh City, Dong Thap province and Plant of Branch 3 in Binh Duong Province is as follows:

In addition, Imexpharm annually encourages their staff to take part in the campaign of Earth Hour. The title for the 2015 campaign is “Saving Energy – Dealing with Climate Change” took place on March 28, 2015.

Power Saving Solutions for the year 2015In 2015, Imexpharm will continue to implement measures to rationalize production and increase productivity, reduce labor hours and peak hours, while continuing to implement measures recommended by the energy audit within the budget allocated, trying to save more power.

Power Unit Coefficient

for Conversion

2014Power

ConversionEquivalent

Usage Rate

Electricity Kwh 0.1543.10-3 6,120,527 944.4 90.4%

Diesel Oil 1.000 litters

0.88 113,915 100.3 9.6%

management, and more improvements proposed by the energy audit department, which involves replacing lighting equipment for those that use less power. The rate of energy consumption per million products fell by 5.3%.

Conversion From diesel Oil to TOE in 2014

In 2014, Imexpharm’s production increased by 20.6%, but used energy increased by only 14.1%. This savings is due to energy off efficient measures applied such as turning off devices when they are not used, turning off air conditioning in offices 20 minutes before leaving, lean production

Targets Unit 2013 2014

Water Consumption m3 49,550 45,216

Production million units (pill/pack) 1,013.5 1,222.2

Rate m3/million units 48.9 37.0

TOWARDS A GREEN ENVIRONEMNT

Imexpharm always provides staff training course to raise awareness of water saving, and encourage re-using water in production and daily life.

18


Items Testing Approach Unit

Vietnam Stan-dard

05:2013

2013 2014

No monitoring 18Jun8

Dec

Dust TCVN 5067:1995 mg/Nm3 0.3 - - 0.172 0.176SO2 TCVN5971:1995

mg/Nm3 0.35 - - 0.087 0.094

NO2 TCVN 6137:2009mg/Nm3 0.2 - - 0.082 0.073

CO TQKT-YHLD & mg/Nm3 30 - - 2.3 3.1Tem-pera-ture

VSMT 1993 0C - - - 33.9 34.2

Hu-mid-ity

QCVN 46 : 2012/ %RH - - - 66.9 65.2

Noise BTNMT dBA


EFFICIENT MANAGEMENTOF WASTE & WASTE WATER WASTE WATER Waste water is generated from overflow rainwater, waste water from production and daily life.The company built a separate drainage for wastewater from rainwater runoff, domestic sewage and industrial wastewater. Domestic wastewater was collected and pre-treated in a septic tank, then processed at wastewater treatment system before being put into receptacles. Industrial wastewater was treated by the wastewater treatment system before being put into receptacles.

Plant of Dong Thap Industrial wastewater generated mainly from the following stages:

- Wash mixing, blending utensils with excipient active ingredients in the pill production technology, employees wash hands: 25-30 m3 per day- Waste water from drug quality testing: 3- 5 m3 per day3- 5 m3/ day*Place of discharge: is connected to the daily water treatment system of Cao Lanh City and licensed by The Ministry of Natural Resources and Environment.* Methods of treatment: physical chemistry + microbiology

OPERATION PRINCIPLES

* Dong Thap Plant Post Waste Water Treatment Quality

Items Testing Approach Unit Vietnam Standard 402013 2014

17 April 28 November 22 May 27 NovemberpH Machine - 6-9 7.59 7.35 7.68 7.69BOD5 Sensor mg/l 30 30 28 24 26COD Method 8000 mg/l 75 46 60 38 48TSS TCVN6625-2000 mg/l 50 50 16 14 48Nitrogen Total TCVN 5987-1995 mg/l 15 4.34 3.64 3.36 3.64P Total Method 8180 mg/l 4 1.3 1.3 2.8 1.30Clorin Method 8021/DR5000 mg/l 1 0.11 0.05 0.1 0.05Amoni TCVN 5988-1995 mg/l 5 2.66 1.4 2.52 2.12Mangan Method 8034/DR5000 mg/l 0.5 KPH 0,048 KPH 0,084Colifrom TCVN6187-2:1996 MPN/ 3.000 2200 2700 240 75Amoxicillin Lower than the detection limit passed passed

(Monitoring Agency: Monitoring Centre of Natural Resources and Environment Department of Dong Thap province)

Standards of waste water are consistent with the standards of the Ministry of Natural Resources and Environment.

Collection pit – T01

Detention tank – T02

Oxidation tank – T03

Clarified tank – T04

Attached growth Aerobic tank – T05

Precipitation tank – T06 Pump PS06A/B

pH adjustment

Ozone machine

Air blower

Disinfection tank – T07Disinfectant chemical

Receptacles (Vietnam standards 40/2011/

BTNMT) column A

Pump PW01A/B

Pump PW02A/B

Oxy

Pump PW03A/B

PumpPC04A/B

Sludge in circle

Residual sludge

pump PS06A/BWaste sludge

Oxy

Oxy

Pump PC03

Waste water from the Plant

22


*Wastewater Quality after being treated in Branch 3- Binh Duong Province.

Plant of Branch 3 – Binh Duong ProvinceTotal volume of Wastewater in Branch 3 – Binh Duong Province- Domestic wastewater: 3 m3 per day- Industrial wastewater: 15 m3 per day* Place of Discharge: is connected to the sewerage system of VSIP II – Binh Duong province* Methods of treatment: physical chemistry + microbiology

Standards are consistent with standards of VSIP II Industrial Park in Binh Duong Province.

* Joint: Wastewater after being treated is connected to the wastewater collection system of VSIP II – Binh Duong Province

* Currently no organization reuses Imexpharm’s wastewater

Items Testing Approach UnitWastewater

quality at VSIP

2013 2014

21June 9 December 18 June 8 December

pH(*) TCVN 6492:2011 - 6 – 9 7.32 7.29 7.34 7.58TSS(*) TCVN 6625:2000 mg/l 400 75 31 31 24BOD5 (20

oC) TCVN 6001-1:2008 mg/l 400 64 42 22 56COD(*) TCVN 6191:1999 mg/l 600 127 89 38 98N – NH4

+ (*) TCVN 5988:1995 mg/l 8 2.9 2.1 7.6 6.12Total Nitrogen(*) TCVN 6638:2000 mg/l 20 11.5 10.4 18.9 13.5

Total Phos-phorus

TCVN 6202:2008 mg/l 5 2.3 2.3 2.1 1.4

Fat and Oil Ref SMEWW 5520B mg/l 10 1.89 0.9 0.58 0.18

Total Coliform TCVN 6187-2:1996 MPN/1000 ml 5,000 2.7x103 2.1x103 2.1x103 2.1x103

(Monitoring Agency: Phuong Nam Science Technology and Environmental Analysis Co. Ltd)

PROCESS FLOWCHART -INDUSTRIAL WASTE WATER TREATMENT TECHNOLOGY

EFFICIENT MANAGEMENT OF WASTE& WASTE WATER (continued) Waste water

Wastewater

Sludge in circle

NaOH

Sludge treatment tank

Waste sludge

Collecting unit ofhazardous emission

Ozone

ReceptaclesWastewater treatment

system at VSIP II

Gully grating

De-betalactam

Detention tank

Air blower

Precipitation tank

Oxidation tank

24


NON-HAZARDOUS SOLID WASTE

* Plant of Dong Thap:Sources of non-hazardous waste are mainly from paper packaging, plastic packaging, clean nylon, carton, and paper scraps. The volume of 2014 was 0.4 tons per month. Details are as follows:

HAZARDOUS SOLID WASTEHazardous solid waste is managed based on Regulations of Hazardous Waste Management (according to Circular 12/2011/TT-BTNMT dated April 14, 2011 by The Ministry of Environment and Resources). Imexpharm has registered a Master Book of hazardous solid waste with the Environmental Management Agency for easy monitoring of this kind of waste. Furthermore, the company signed contracts with other environmental companies in charge of collecting and disposing emission in accordance with Governmental regulations.

* Factory of Dong Thap:Hazardous waste produced during production: powder medicine, solid waste, sludge, expired medicine, reactant, unqualified medicine, testing chemicals, etc. In 2014, it is estimated that the factory produced fewer than 1.5 tons of hazardous waste per month.

Imexpharm signed a contract with Holcim VN Co., Ltd. to treating hazardous waste in accordance with relevant regulations.

All hazardous waste produced during the production process is collected in tanks and handed over quarterly to Holcim Viet Nam for disposal.

According to the contractor after disposal, documentation will be transferred to Imexpharm in compliance with regulations.

* Branch 3 – Binh Duong Waste produced during the production process such as: pharmaceutical defectives, soft and hard covers containing dangerous components, testing chemicals, viscous waste, etc. In 2014, the plant produced approximately 239kg of waste per month.

* On-site storage: Hazardous waste tanks as designed regulations.

* Imexpharm hires a unit in charge of waste treatment – Binh Duong Supply Sewerage Environment Co., Ltd. to dispose waste in compliance with regulations.

* All hazardous waste produced during the production process is collected in hazardous waste storage and handed over quarterly to the waste disposal factory – Binh Duong Supply Sewerage Environment Co., Ltd. for compliant disposal.

*According to the contractor, after disposal, documentation will be transferred to Imexpharm in compliance with regulations.

Waste Disposal Method Volume (kg)

Nylon Recycled 635

Aluminum Recycled 22,759

Cardboard Recycled 22,604

Polymer Recycled 230

Iron Recycled 1,443

Total 47,671

* Branch 3 – Binh Duong ProvinceSources of non-hazardous waste are mainly from paper packaging, plastic packaging, clean nylon, carton, and paper scraps. The volume of 2014 was 1.2 tons per month. Details are as follows:

Waste Disposal Method Volume (kg)

Paper Recycled 10,730

Polymer Recycled 1,395

Nylon Recycled 484

Aluminum Recycled 1,876

Total 14,485

Name Code Amount

Viscous waste 17 02 04 5

Used active coal 12 01 04 30

Chemicals (organic solvent and heavy metal)

16 01 01 3,328

Hazardous waste of pharmaceutical products

03 05 09 13,222.86

Solid material waste (glass bottles, cov-ers contaminated with chemicals, etc.)

18 01 04 954.25

Fluorescent bulbs 16 01 06 28

Battery 16 01 12 20

Laboratory chemicals and chemical mixtures which contain hazardous components

19 05 02 397

Printing Ink Cartridges, ruban 08 02 04 106

Sludge from disposal area 03 05 08 210

Total 18,301.11

Waste Name Code Amount (kg/year)Pharmaceutical defectives 1877

Printing ink cartridge waste 1.4

Active coal waste 10

Sludge waste 51

Chemical waste 10

Neon tubes 5.3

Cell, lead batteries 1.2

Electronic components 1.2

Viscous waste 9.5

Soft covers containing hazard-ous waste

759

Hard covers containing hazard-ous waste

84

Toxic medicine 51

Rags containing hazardous waste

9.5

Total 2870.1

WASTE

26


TOTAL COST ANDINVESTMENT FOR ENVIRONMENTAL PROTECTION

EFFECIENT MANAGEMENT OF PRODUCTION CONDITION

Waste disposal costs in 2014for the whole company:

Dangerous waste disposal:

215,189,244 VNDWaste water costs:

250,000,000 VNDWaste water costs: Imexpharm spends a large amount for environmental protection and management at an advanced standard factory. Much of these costs are fixed factory assets. However, we haven’t yet completed the statistics to provide in this report.

Since 2013, Imexpharm has successfully implemented ISO:14000 at the two main factories at Cao Lanh and Binh Duong. ISO:14000 is a group of standards related to environmental management issued by The International Standards Organization that exists to help organizations minimize how their operations negatively affect the environment and continuously improve their environmental results. ISO:14000 includes a set of standards relating to aspects of environmental management such as environmental management systems, product life cycle evaluation, ecological labeling, greenhouse gas inventory and determination, etc.

In 2014, Imexpharm upgraded the Binh Duong factory in compliance to EU-GMP standards in order to improve a production condition of the least impact on environment, and more importantly to enhance product quality and safety. This project is estimated to be completed in 2015 and receive certification in Quarter II of 2016.

Imexpharm has created jobs and brought benefits to thousands of people at Cao Lanh City for over 30 years. The company has actively contributed to the state budget and taken part in many local social activities. Imexpharm has made a significant contribution to the development of Cao Lanh City in particular and Dong Thap Province in general.

Imexpharm’s total contributions from 2013-2014:

Imexpharm has been consistently praised by the Dong Thap Province Taxation Bureau as an exemplary company in taxation payment for many years.

LOCAL HUMAN RESOURCEAND ECONOMIC DEVELOPMENT

Associated parties Target 2014 2013

Shareholders, investors Dividend amount

24.6

32.8

Labors Total salary 125.8

121.8

State Total tax payment 74.8

71.2

Customers/Distrib-utors Total transaction value

953.4

896.3

Partners Total transaction value 699.0

474.3

Public Contribution to public 2.4 3.4

(Unit: billion Dong)

28


Imexpharm produces medicine in a solid facility constructed by ferro-concrete. The company uses industrial electricity and DO oil. The average temperature in production is 22 to 28 degrees Celsius.

LABOUR SAFETY AT THE WORKPLACE

Imexpharm has established a 4 – member – Committee of Labour Protection. The Chairman is the Deputy General Director of Production and the Vice Chairman is Trade Union President. The Committee is responsible for Safety, Hygiene, Firefighting and protection, and reporting to the General Director. The Safety Team includes seven members while the Fire Fighting and Protection Team includes a Team leader, a Vice Team Leader and four specialized teams. In addition, another 46 members are responsible for hygiene inside their production departments, another group comprises the Emergency and Environment Team; all of these teams report to the General Director and Committee of Labour Protection.

SAFETY AND HYGIENE AT WORK PERFORMANCE

The number of employees affected by work place safety and hygiene in 2014 was 53, accounting for 5.5%.

Accident Report Regulations - The company’s Healthcare Center record accidents

in an accident logbook according to Annex 09, Circular 12/2012/TTLT-BLĐTBXH-BYT, which provides instructions on reporting, investigation and recording of occupational accidents.

SAFETY AND HYGIENE IN PRODUCTION

- Periodically each six months, the Safety Committee submits occupational accident reports of to the Department of Labor, War Invalids and Social Affairs according to Annex 10 of Circular 12/2012/TTLT-BLĐTBXH-BYT.

Statistics in 2013-2014- Occupational Death Rate (ODR): 0%- Leave Day Rate (due to occupational accident and

disease) (LDR): 0%- Absent Rate (due to occupational accident and diseases)

(AR): 0%- Deaths related to occupational accident and diseases:

None

Annual working conditions are evaluated by the Preventive Medicine Center that records results stipulated by Circular 19/TT-BYT relevant to instruct management in issues of labour hygiene, labor healthcare and occupational disease (low rate of infection). Imexpharm has signed an agreement with its employees about safety and healthcare; and has issued the following working regulations:

Performance result in executing Regulations of Safety, Hygiene in Work 2014:-Ensure hygienic working conditions- Equip employees with protective clothing- Provide safety training- Regular health check program- Strictly verify equipment

No Targets Unit Result

1

Employees

1.1. Total Person 957

+ Females Person 358

1.2. Direct Employees Person 402

+ Females Person 163

+ Employees working in hard and hazardous conditions (work-ing condition types IV, V & VI)

Person

2

Occupational Accidents

- Total cases Case 0

+ Deaths Case 0

- Total number of victims Person 0

+ Deaths Person 0

- Total cost for occupational accidents (emergency, treatment, salary on leaving day, compensation, allowances, etc.)

Million VND -

- Asset damage (in cash) Million VND -

Leave day dues to occupational accident Day 0

3

Occupational Disease

- Number of people contracting occupational diseases up to the time of this report

Person 0

People contracting new occupational diseases Person 0

- Leave days due to occupational disease Day 0

- People receiving early retirement due to occupational disease Person 0

Total cost for employees with occupational diseases during the year (Expenditures exclude safety and hygiene at work such as: treatment, salary on leave day, compensation, allowances, etc.)

Million VND 0

Details as follows:


4

Employee Health Classification

+ Type I Person 212

+ Type II Person 632

+ Type III Person 90

+ Type IV Person 23

+ Type V Person -

5

Training about Safety and Hygiene at Work

- Total trained employees/total current employeesPerson/ person

32

957

- Total trained safety-hygiene officers/Total current safety-hy-giene officers Person/ person

7

7

- Total safety & hygiene trained staff/Total current safety & hygiene trained staff Person/ person

33

46

- Safety certificated employees/Total employees working in conditions requiring strict safety and hygiene requirements Person/ person

402

10

- Total trained employees Person 402

- Total training cost Million VND 2

6

Machines and Equipment Requiring Strict Safetyand Hygiene condition

- Total Piece 8

+ Registered Piece 8+ Tested Piece 8

7Working Hours, Break Hours

- Average overtime hour per day per person Hour 04

- Average overtime day per 6 months per person Day 50

8Noxious Compensation

- Total employees Person 310

- Total cost VND/ month 117,000,000

9

Working Environment Evaluation

- Samples for environmental evaluation Sample 223

- Under standard samples Sample 0

- Admissible under standard sample/total sample

Sample

0/223

+ Temperature 0/27

+ Humidity 0/27

+ Wind velocity 0/27

+ Dust 0/27

+ Noise 0/27

+ Vibration 0/12

+ Toxic gas 0/27

+ Light 0/27

+ Magnetic field 0/22

10

Safety & hygiene cost

- Safety technical methods (staircase for air-conditioner clean-ing, improve panel, etc.)

Million VND 160

- Hygiene technical methods (HVAC filter replacement, etc.) Million VND 50

- Individual protective clothes (clothes, shoes, masks, etc.) Million VND 150

- Labor healthcare (regular heath check, etc.) Billion VND 1

- Communication, training Million VND 20

- Others Million VND 5

SAFETY AND HYGIENE IN PRODUCTION (continued)

32


CUSTOMERS’ HEALTH ANDSAFETY IS OF UTMOST CONCERN

Machine/Equipment Name Manufac-tured by

Specification Most recent test (month/ year)

Next test(month/ year)

A B C

Compressed air tank (Peni factory)

VN 8kg/cm2 1000 lít - 12/2012 12/2015

Compressed air tank (Non factory)

VN 8kg/cm2 2000 lít - 08/2012 07/2015

Boiler using DO 1 VN 8kg/cm2 200 lít 700kg/h 02/2014 02/2016

Boiler using DO 2 VN 8kg/cm2 200 lít 700kg/h 06/2013 05/2015

Winch VN 0.25T 15m 0.16m/s 02/2014 02/2016

Office elevator VN 1T 25m 1m/s 05/2013 04/2018

Autoclave 1 Taiwan 1.5kg/cm2 49 lít - 11/2014 11/2016

Autoclave 2 Taiwan 1.5kg/cm2 49 lít - 11/2014 11/2016

Current Machines, Equipment Requiring Specific Industrial safety standards, and status testing:

Specifications:

- Pressure equipment: A: pressure (kg/cm2); B: volume (liter); C: capacity (kg/h)- Lifting equipment: A: capacity (ton); B: aperture (meter); C: lifting velocity (m/s)- Other equipment: basic specifications as other mentioned equipment

STRICT QUALITYMANAGEMENT SYSTEM

Imexpharm applies more than 100 quality management processes from input to output in order to ensure absolute safety and product quality.

In material purchasing, we apply a tendering process which requires at least two European suppliers, requests for sample for testing, and safe transportation from their factory to Vietnam without impact on product quality. We take samples from each lot, submit the samples to authorized offices for quality evaluation. Vehicles are also strictly kept in good condition concerning humidity and temperature and will be tested again before being brought into the production facilities. Especially on the injection medicine production line, we apply an advanced robotic system imported from Bosch & Schrauber, Germany. Furthermore, in order to ensure maximum safety, we use SAP – ERP software in production to manage formulas and material volume. Before bringing finished products to the market, they go through a bilateral quality management process, which involves both authorized laboratories and internal evaluation, or our multinational partner’s pharmaceutical evaluation group. As a result, products must pass all safety and quality evaluations at each stage of the production process.

SAFETY AND HYGIENEIN PRODUCTION (continued)


CUSTOMERS’ HEALTH AND SAFETYIS OF UTMOST CONCERN (continued)

ENHANCING SAFETY ANDHEALTH FOR CONSUMERS

Despite our strict quality management processes, Imexpharm accepts that product quality risk is still a possibility. This risk is especially acute during market distribution. It is always a possibility that the drug will be applied incorrectly, seriously affecting the user’s health, and in turn, the company’s reputation.

Currently, more than half of Imexpharm’s main products equivalent to 5% of total products, have been tested via bio-equivalence or clinical trial at the most reputable hospitals in Vietnam in order to ensure safety and effectiveness for users. Our goal is to ensure that 100% of our products are tested and evaluated and deemed effective and has a positive impact on the user’s health.

In addition, we apply other processes (see below) to manage our product quality, while the drugs are in the market:

• Pharmacy Observation System (SOP 1.0.019): Acts as a legal requirement about tasks and responsibilities of Pharmacy Observation: Prevents

negative impact and harmful reactions when consumers take medicine or have occupational contact; enhances safe and efficient use of medicine by providing timely full information about medicine use safety to patients, officers in charge of healthcare and the community; protects health for patients and the community.

• Customer’s Complaint Handling Process (SOP 1.0.005): Ensures that all comments regarding quality, safety, and efficiency of a product, material faults, production, packing, and testing process can be improved; maintains the reputation of the company.

Recognition in 2014:

• Pharmacy Observation: None• Customer complaint: One case (Reason: Medicine and

pharmaceutical products were stored incorrectly at the drug stores), was solved fast and satisfactorily for the customer.

SOCIALLY RESPONSIBLE PRODUCT: “PURE ANTIBIOTICS”

Our product quality is in compliance with the strict standards of British Pharmacy (BP), European Pharmacy (EP) and United States of America Pharmacy (USP). We have an advanced production line, materials imported from Europe, US, Japan, South Korea, etc., advanced quality management system verified by reputable pharmaceutical groups, all conditions have met patient’s treatment demands with reasonable pricing. Experiencing in many years in studying changes of Vietnamese diseases, Imexpharm has launched more than 200 products of various types such as: antibiotics, pain and fever relief, anti-inflammation, muscle-bone-joint, vitamins, minerals, as well as products with specific applications like: digestion, liver and bile system, cardiac and vascular system, respiration system, central nervous system, hormone, endocrine and metabolism system, ocular, allergy and immunity system, and a variety of other products.

In 2014, Imexpharm cooperated with PharmaScience (Canada) to launch a new, high quality, functional food product line to improve customer’s health and prevent disease.

Labeling100% our products are labeled with information such as: ingredients, impact mechanism, effects, directions, side effects, etc., for consumer understanding. In addition, Imexpharm works to minimize risk by encouraging

medical prescriptions and safety warnings for patients.No case of non-compliant product labeling and service was reported in 2014.

Preventing Counterfeit MedicationRaising awareness that fake medicine and pharmaceutical products are more popular and seriously affect health of the community, we always highly appreciate the spirit of fighting preventing patients from fake medicine and pharmaceutical products. We have labeled to confirm the true products and to ensure that Imexpharm’s products have not been faked and launched in the markets.

“Pure” Antibiotics: Increasing Safety and Minimizing Side Effects

Imexpharm absolutely does not use organic solvents in production. Therefore, there is no risk of organic solvent remaining in product, ensuring product safety for patients, and no negative environmental impact during production.

Particularly, materials used to produce famous antibiotics such as: pms-Claminat, pms-Pharmox, pms-Opxi, etc., are produced using the fermentation (Enzymatic) method developed by DSM Group (Spain) which includes no chemical catalysts, no remaining solvents, no health harm and contributes to environmental protection. This improvement is highly acclaimed by experts.

36


EMPLOYEES ANDSUSTAINABLE DEVELOPMENT

Human resources come first in our sustainable development strategy. To help our employees get in line with our development, especially our management team, sales and intellectual labor and in pharmacies, Imexpharm invests heavily in training. Recruitment, attracting talent, utilizing training budget and opportunity cost for training and re-training and employee retention play key roles in the company. Thus, Imexpharm created a progressive benefits and compensation package for employees, and continuously build up a rich culture environment for recruiting and maintaining talents.

Management Force by Gender

Management Force by Age

Average Training Hours by Gender

Compensations and Benefits:

Target2012 2013 2014

Quantity Rate % Quantity Rate % Quantity Rate %Total 853 100% 883 100% 962 100%

Male 516 60% 548 62% 597 62%

Female 337 40% 335 38% 365 38%

Management2012 2013 2014

Quantity Rate % Quantity Rate % Quantity Rate %

Total 101 100% 119 100% 156 100%

Male 55 54% 70 59% 94 60%

Female 46 46% 49 41% 62 40%

Target2012 2013 2014

Female Male Total Female Male Total Female Male Total

Total training hours 4,503 6,755 11,258 4,520 6,781 11,301 5,013 7,520 12,533

Total staff 337 516 853 335 548 883 365 597 962

Average training hours 13.36 13.09 13.20 13.49 12.37 12.80 13.73 12.60 13.03

Management2012 2013 2014


Total 101 100% 119 100% 156 100%

Under 30 1 1% 6 5% 12 8%

30-50 years 73 72% 86 72% 117 75%

Over 50 27 27% 27 23% 27 17%

Compensation and Benefits Units 2012 2013 2014

Qty Amount Qty Amount Qty Amount

Healthcare (sick leave) person/VND 117

84,521,654 167 261,225,000 165 217,093,400

Social Insurance for employees terminating contract after maternity leave

person/VND 18

307,798,800 24 560,227,200 54 719,868,200

Retirement allowances: 30 working day salary person 8 165,533,780

Share owning right: ESOP (5% circulating share, buying price:12,000 VND/share person 167

Target2012 2013 2014


Total 853 100% 883 100% 962 100%

Under 30 302 35% 332 38% 312 32.4%

30-50 years 513 60% 525 59% 591 61.4%

Over 50 38 4.45% 26 2.94% 59 6.1%

Male and young employees account for a majority of Imexpharm’s labor force.

Imexpharm employs young generation of management accounting by 60% of male and 40% of female.100% of the General Management Board, 5/8 of the BOD members, and 1/3 of the Board of Supervisors are from Dong Thap Province.

Manual labor based production requires Imexpharm to recruit a higher percentage of male workers. However, the female labor force always receives more training hours, as they account for majority of the sales team and upper management.

At Imexpharm, everyone receives equal treatment, and has a labor contract with collective labor agreements. We do not use child or forced labor, with priority being given to candidates from Cao Lanh City. Every employee has equal opportunity for training and promotion.

(For more details about Labor mechanism, benefits, compensation and training, please see Annual Report/Corporate Governance/Human Resource for Sustainable Development)

Labor Force by Gender

Labor Force by Age

38


EMPLOYEES AND SUSTAINABLEDEVELOPMENT (continued)

Employee’s income by age and gender (VND/person/month):

Imexpharm held 10 annual community activities in 2014:

Employee’s income by department and gender:

Age2012 2013 2014

Male Female Male Female Male Female

50 9,500,000 11,200,000 9,800,000 11,600,000 11,200,000 11,900,000

Department2012 2013 2014

Male Female Male Female Male Female

Production 8,400,000 8,700,000 8,200,000 9,500,000 9,100,000 10,300,000

Administrative 8,400,000 9,300,000 8,600,000 10,000,000 10,824,000 11,542,000

Sales 7,900,000 9,200,000 8,700,000 9,400,000 8,792,000 9,300,000

Generally, female employees have higher income as compared to males of any age, and the average income for both females and males increases as age increases.

Female income is always higher than that of males in every department. Additionally, administrative department income was the highest in 2014.

Employee’s income does not depend on working area, only an additional allowance is added according to the employees’ living area:

-HCM City, the East and the Central:

40,000 VND per day per person.

-Hanoi:

60,000 VND per day per person

CORPORATE SOCIALRESPONSIBILITY PRACTICE IN 2014

ACTIVITY TIMES PERYEAR EVENTPARTICIPANTS/BENEFICIARIES GOAL COST (VND)

Provide clinical care and free medicine

12

Doctors from Hospital Dist. 2: 8 times; Doctors from University Medical Center HCM: 4 times

Based on request from organs including local Hospital/People’s Committee/Nation-al Battle front Committee/Youth Union

Total poor patients and policy served is 8.000 persons at 12 poor communes at provinces

Enhanced healthcare and medicine for people in remote areas and families under preferential treatment policy

400,000,000

Educational Promotion program of Huynh Thuc Khang – Da Nang

1Fund of Educational Promotion Fund of Da Nang, Da Nang People’s Committee, Education and Training Department

Students in Da Nang CityNational education development advancing the next generation

100,000,000

Educational Promotion program of Nguyen Sinh Sac – Dong Thap Province

1

People’s Committee of Dong Thap and Cao Lanh City, Fund of Educational Promotion of Dong Thap, Education and Training Department

Students and Teachers at Dong Thap Province

Provincial education devel-opment advancing the next generation

550,000,000

Exemplary Students 4 Dong Thap Television Students at Dong Thap Province

Provincial education devel-opment advancing the next generation

48,000,000

Fund for Vietnamese Hero Mothers

12Vietnamese Hero Mothers in Dong Thap Province

Vietnamese Hero Mothers Repay for their Contribution 6,000,000

Badminton Competition for Medical Employees

1 Can Tho City Medical Department Employees working in medical industry at Can Tho City

Health improvement and experi-ence exchange

80,000,000

Tennis Competition in the Mekong Delta

1 Local Health Department hosted 200 officials and employees working in the medical sector in the Mekong Delta which includes 16 provinces

Health improvement and experi-ence exchange

440,000,000

Sponsored hats & shirts for examination support program

1 Trade Union of University Medical Center HCM

Contestants apply to Universi-ty Medical Center HCM

Support volunteer students in guiding students at hosting points of the University Medical Center HCM

70,000,000

Scientific report con-ference of Medicine & International Exhibition of Pharmaceutical Industry

1 University Medical Center HCM and Vietnam Pharmaceutical Business Association

Medical experts Promote brands and products of Imexpharm through the expertise at large scale conference 80,000,000

Educational Promotion Program 2014

1 Imexpharm/ Marketing Department performance

Children of our customers & pharmacies all over the country

Encourage and praise customers children who have excel in school.

600,000,000

TOTAL 2,374,000,000

Female employees come back to work after maternity leave:Target Unit 2012 2013 2014

Female employees on maternity leave and baby care policy person 18 24 54

Female employees on maternity leave and baby care policy person 18 24 54

Females returning after maternity leave person 18 24 54

Coming back work after maternity leave and baby care % 100 100 100

40


Increasing Access to Health Care and Medicinefor People in Remote Areas

Operating in the pharmaceutical sector, Imexpharm finds health protection paramount to ensuring social security. However, in Vietnam, important health care quality indicators (such as health care costs per person per year, the number of doctors and pharmacists per capita, number of patient beds per capita) are still very low when compared with other countries both within the region, and around the world. In particular, people in remote areas have difficulty accessing medical services which adds to the fear of disease.

Understanding these difficulties, Imexpharm has, over the years, cooperated with big hospitals in HCMC (such as the University Medical Center HCMC, Cho Ray Hospital) to provide free medicine to people in poor areas and by distributing to people in need around the country. We conducted these activities annually by our devotion, regardless of limited travel and commodity conditions. Over hundreds of trips, thousands of people have been provided with free medical care. Imexpharm will continue this journey to bring health care to many more people, who might otherwise go without.

Education FirstWith the goal of preserving and developing traditional ways of Vietnamese learning spirit, the program of Educational Promotion has been sponsored by Imexpharm and it has been acknowledged by the community. Imexpharm has diligently awarded thousands of scholarships and

CORPORATE SOCIAL RESPONSIBILITYPRACTICE 2014 (continued)

prizes to encourage pupils. These students (particularly the gifted of Dong Thap Province, employee’s children, customer’s children, and students specialized in medical study across the country) benefit from and overcome challenges to get impressive results at school. As a result, the General Director of Imexpharm was recognized by the Prime Minister for his dedication to the nation’s education.

Imexpharm has truly contributed to the sustainable development of our country via their efforts in health care and education. Beside mentioned annual activities, in 2014, Imexpharm joined the program of “the Vietnamese priority is using domestic manufactured products” launched by Ministry of Health

“The Vietnamese priority is using domestic goods” is one of the messages from a launch of Government and this program was used to encourage local consumers to use domestic goods. To these ends, as a result of the Imexpharms’s efforts, the company has been awarded the Ministry of Health’s “Vietnam Star for the best pharmaceutical products” for the antibiotic pms-Claminat. In addition to Imexpharm’s participation, the company also communicates this message to employees in particular and to the community in general.

REFERENCE TO GRI G4 INDICATOR GENERAL STANDARD DISCLOSURES

General Standard Disclosures Page Number (or Link) External Assurance

STRATEGY AND ANALYSIS

G4-1 Page 2-3

ORGANIZATIONAL PROFILE

G4-3 Annual Report Page 14

G4-4 Page 11


G4-6 Page 10


G4-8 Page 10-11

G4-9Page 9 - 2014 Targets

Financial Statements audited by Deloitte Vietnam

G4-10 Page 38All Imexpharm employees sign long - term contracts following probation period

G4-11 Page 38 - 100% employees engage in Collective Labor Agreement

G4-12 Page 10 - 20 sales branches and nearly 40 intermediate distributors nationwide

G4-13 Page 10 - In 2014, we established one more sales branch in HCM City and prepared for office construction of other branches.In 2014, we increased our charter capital from 167.06 billion VND to 263.12 billion VND.We have traditional suppliers providing us stable and qualified raw materials

G4-14 Page 4,14 - GRI, G4

G4-15 Page 4,14 - GRI, G4

G4-16 None

IDENTIFIED MATERIAL ASPECTS AND BOUNDARIES

G4-17 Page 10 - We do not prepare consolidated financial statements because all branches depend on accounting

G4-18 Page 14

G4-19 Page 17

G4-20 Page 17

42


G4-21 Page 17

G4-22 None

G4-23 None

STAKEHOLDER ENGAGEMENT

G4-24 Page 14-15

G4-25 Page 14

G4-26 Page 15

G4-27 Page 15-16

REPORT PROFILE

G4-28 Page 4

G4-29 Page 4 - Report of Sustainable Development 2013 integrated with Annual Report 2013

G4-30 Page 4 - Report is made annually in the same financial year with Annual Report

G4-31 Page 4 - Contact details

G4-32 Page 4 - “Reference” GRI-G4, Page 39-42

G4-33 None

GOVERNANCE

G4-34 Page 12 - 13 & Annual Report, Page 30-32

ETHICS AND INTEGRITY

G4-56 Annual Report, Page 19 & Page 94

SPECIFIC STANDARD DISCLOSURES

DMA and Indicators Page Number (or Link) Identified Omission(s)Reason(s) for Omission(s)

Explanation for Omission(s)

External Assurance

CATEGORY: ECONOMIC

MATERIAL ASPECT: ECONOMIC PERFORMANCE

G4-DMA Page 29

G4-EC1 Page 29 & Annual Report Page 4-6

MATERIAL ASPECT: MARKET PRESENCE

G4-DMA Page 39

G4-EC6 Page 39

CATEGORY: ENVIRONMENTAL

MATERIAL ASPECT: ENERGY

G4-DMA Page 18 - Consuming sustainable energy

G4-EN3 Page 18 - Consuming sustainable energy

G4-EN5 Page 18 - Consuming sustainable energy

MATERIAL ASPECT: WATER

G4-DMA Page 19 - Water is the heart of sustainable development

G4-EN8 Page 19 - Water is the heart of sustainable development

G4-EN10 Page 19 - Water is the heart of sustainable development

MATERIAL ASPECT: EMISSIONS

G4-DMA Page 20, 21- Regular monitoring emissions

G4-EN15 Page 20, 21- Regular monitoring emissions

MATERIAL ASPECT: EFFLUENTS AND WASTE

G4-DMA Page 22-27 - Efficient management of waste & waste water

G4-EN22 Page 22-27 - Efficient management of waste & waste water

G4-EN23 Page 26-27 - Waste

MATERIAL ASPECT: OVERALL

G4-DMA Page 24

G4-EN31 Page 28 - Total cost andinvestment for environmental protection

Total cost for environmental protection

have not yet completed report

CATEGORY: SOCIAL

SUB-CATEGORY: LABOR PRACTICES AND DECENT WORK

JOB

G4-DMA Page 38

G4-LA2 Page 39

G4-LA3 Page 40

REFERENCE TO GRIG4 INDICTOR (continued)

44


APPENDIX 1

MATERIAL ASPECT: OCCUPATIONAL HEALTH AND SAFETY

G4-DMA Page 30

G4-LA5 Page 30

G4-LA6 Page 30-31

MATERIAL ASPECT: TRAINING AND EDUCATION

G4-DMA Page 38

G4-LA9 Page 39

MATERIAL ASPECT: DIVERSITY AND EQUAL OPPORTUNITY

G4-DMA Page 38

G4-LA12 Page 39

MATERIAL ASPECT: EQUAL REMUNERATION FOR WOMEN AND MEN

G4-DMA Page 39

G4-LA13 Page 40

SUB-CATEGORY: SOCIETY

MATERIAL ASPECT: LOCAL COMMUNITIES

G4-DMA Page 41-42 - Corporate social responsibility practice in 2014

G4-SO1 Page 41-42 - Corporate social responsibility practice in 2014

SUB-CATEGORY: PRODUCT RESPONSIBILITY

MATERIAL ASPECT: CUSTOMER HEALTH AND SAFETY

G4-DMA Page 36

G4-PR1 Page 36

MATERIAL ASPECT: PRODUCT AND SERVICE LABELING

G4-DMA Page 37 - Socially responsible product: “pure antibiotics”

G4-PR3 Page 37 - Labeling

The Open Letter and Questionnaires to whom may it concern relevant to asking for consultationon Imexpharm’s Sustainable Development issues.

OPEN LETTERDear Sir/Madam:………………………………… (Position – Company)

Imexpharm Pharmaceutical JSC is proud to send you this letter to ask for your valuable advice.

Dear Sir/Madam,

In order to better meet the expectations of associated parties (customers, partners, shareholders, investors, employees, local authority, and the community), Imexpharm has been working diligently to improve our operations not only in production, business and products, but also towards the environment and society. We also understand that communicating and listening to the associated parties will help to increase efficiency, and bring more benefits to Imexpharm and our stakeholders.

In 2014, we established the Committee of Sustainable Development to communicate with you on economic, social and environmental issues. Annually, we send you our Sustainability Report (BCPTBV) under the framework of latest international standards. This will help to increase transparency, and help us earn your trust.(Name) is representative for group of associated parties and, as such, is extremely important to us. Therefore, in order to make our activities and the Sustainable Development Report meet your expectations, please kindly take a moment to answer a few questions. Your input is extremely valuable, not only contributing to the sustainable development of Imexpharm in particular, but also for the sustainability of the entire community where we live, work and grow.

We are highly appreciate your support!

Deputy General Director

REFERENCE TO GRIG4 INDICTOR (continued)

NGUYEN QUOC DINH

46

I. Kindly note your interest level in the following issues (1: Low, 2: Medium, 3: High)

1. Performance and contribution to Dong Thap Province 1 2 3

2. Initial salary by gender and rate of senior managers employed in Dong Thap Province 1 2 3

3. Rate of purchasing from the local suppliers in materials and packaging 1 2 3

4. Volume of used materials and packaging, and recycled materials 1 2 3

5. Energy consumption and reduction 1 2 3

6. Water consumption, affected sources and reused 1 2 3

7. Greenhouse gas emissions 1 2 3

8. Waste water and substance waste 1 2 3

9. Total cost and investment in environmental protection 1 2 3

10. Newly hired labor and labor exchange, benefits and compensation for fulltime employees, rate of maternity leave return 1 2 3

11. Occupational safety and health 1 2 3

12. Education and training for employees 1 2 3

13. Equal salary for females and males 1 2 3

14. Activities involving local community 1 2 3

15. Customers’ health and safety 1 2 3

16. Information and product labeling 1 2 3

17. Following regulations regarding communication and marketing 1 2 3

II. In your point of view, what we should do to improve your most concerned issues?……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….………………………………………………………………….

III. Besides the issues above, what other areas interest you and why?……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

Please reply to:Mr. Tran The Hao - Head of SustainableDevelopment Committee, ImexpharmPhone: 093 807 5658Email: [email protected]

Ms. Nguyen Thi Kim Le – Vice Head of SustainableDevelopment Committee, ImexpharmPhone: 098 290 7818Email: [email protected]

Thank you!

QUESTIONNAIRE

48

Documents

Utmost Concern - Imexpharmbctn2014.imexpharm.com/download/Imexpharm-SR14-en2014.pdf · 2015. 8. 17. · Health & Safety is of the Utmost Concern SUSTAINABILITY REPORT 2014 IMEXPHARM