Shanghai Fosun Pharmaceutical : ANNOUNCEMENT (1) PROPOSED ADOPTION OF THE 2021 RESTRICTED SHARE INCENTIVE SCHEME (DRAFT) AND (2) CONNECTED TRANSACTIONS（H SHARES）

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Shanghai Fosun Pharmaceutical (Group) Co., Ltd.*

(a joint stock limited company incorporated in the People's Republic of China with limited liability)

(Stock Code: 02196)

ANNOUNCEMENT

(1) PROPOSED ADOPTION OF THE 2021 RESTRICTED SHARE

INCENTIVE SCHEME (DRAFT)

AND

(2) CONNECTED TRANSACTIONS

PROPOSED ADOPTION OF THE 2021 RESTRICTED SHARE INCENTIVE SCHEME (DRAFT)

The Board is pleased to announce that, on 12 March 2021, the Board approved the proposed adoption of the 2021 Restricted Share Incentive Scheme (Draft). The 2021 Restricted Share Incentive Scheme shall become effective upon approval of the Shareholders at the general meeting, A Share class meeting and H Share class meeting of the Company.

HONG KONG LISTING RULES IMPLICATIONS

The 2021 Restricted Share Incentive Scheme does not constitute a share option scheme under Chapter 17 of the Hong Kong Listing Rules. As the Restricted Shares are proposed to be granted to connected persons of the Company under the 2021 Restricted Share Incentive Scheme, therefore, they will constitute non-exempt connected transactions of the Company, which are subject to reporting, announcement and independent shareholder's approval requirements under Chapter 14A of the Hong Kong Listing Rules. An Independent Board Committee will be established by the Company to advise the independent Shareholders in respect of the grant of the Restricted Shares to the participants who are connected persons of the Company. The Company will also appoint an independent financial adviser to advise the Independent Board Committee and the independent Shareholders in respect of the grant of the Restricted Shares to the Participants who are connected persons of the Company.

GENERAL MEETING, CLASS MEETINGS AND CIRCULAR

General meeting, A Share class meeting and H Share class meeting will be convened for Shareholders to consider and, if thought fit, approve, among others, the proposed adoption of the 2021 Restricted Share Incentive Scheme and the proposed grant of Restricted Shares to connected persons of the Company. A circular containing, among other things, (i) terms of the 2021 Restricted Share Incentive Scheme, (ii) a letter to the Independent Board Committee and independent Shareholders from the independent financial advisor, which contains the opinion of the independent financial advisor on the Company's proposed grant plan to the Participants who are connected persons; (iii) the recommendation of the Independent Board Committee as to whether to approve the Company's proposed grant plan to the Participants who are connected persons; and (iv) the notices convening the general meeting the H Share class meeting, will be despatched to the Shareholders as soon as practicable after the date of general meeting and class meetings are determined.

PROPOSED ADOPTION OF 2021 RESTRICTED SHARE INCENTIVE SCHEME (DRAFT)

The Board is pleased to announce that, on 12 March 2021, the Board approved the proposed adoption of the 2021 Restricted Share Incentive Scheme (Draft). The 2021 Restricted Share Incentive Scheme shall become effective upon approval of the shareholders at the general meeting, A Share class meeting and H Share class meeting of the Company. The principal terms of the 2021 Restricted Share Incentive Scheme are summarised below:

I. PURPOSE OF THE INCENTIVE SCHEME

In order to further improve the corporate governance structure of the Group, promote the establishment and improvement of the incentive mechanism of the Company, fully mobilize the enthusiasm, sense of responsibility and mission of the Directors, senior management personnel, middle management personnel and core personnel, effectively align the interests of the Shareholders, the Group with the individual interests of the Participants to focus on and work collectively for the long-term development of the Group, the Incentive Scheme is formulated in accordance with the requirements under the Company Law, Securities Law, Administrative Measures and other relevant laws, regulations, regulatory documents and the Articles of Association.

II. SHARE INCENTIVE METHOD AND SOURCE OF TARGET SHARES

The incentive tool of the Incentive Scheme is Restricted Shares and the source of such Shares is from the issuance of A Shares to the Participants.

III. NUMBER OF RESTRICTED SHARES TO BE GRANTED

A number of up to 2,407,200 Restricted Shares are proposed to be granted to the Participants under the Incentive Scheme, the target shares in relation thereto represents approximately 0.094% of the total share capital of the Company of 2,562,898,545 Shares as at the date of the announcement on the Incentive Scheme. Specifically, a number of 2,286,800 Restricted Shares will be granted underthe First Grant representing approximately 0.089% of the total share capital of the Company of 2,562,898,545 Shares as at the date of the announcement on the Incentive Scheme; and a number of 120,400 Restricted Shares will be reserved for further grant representing approximately 0.005% of the total share capital of the Company of 2,562,898,545 Shares as at the date of the announcement of the Incentive Scheme. The reserved portion represents approximately 5% of the total Restricted Shares to be granted thereunder. The total number of Restricted Shares granted to a Participant under the Incentive Scheme does not exceed 1% of the total share capital of the Company as at the date of the announcement on the Incentive Scheme.

IV. THE SCOPE OF THE PARTICIPANTS AND THEIR RESPECTIVE SHARES TO BE

GRANTED

(I). Basis for determining the Participants

• 1. Legal basis for determining the Participants

  The Participants of the Incentive Scheme are determined in accordance with the Company Law, the Securities Law, the Administrative Measures and the requirements under other relevant laws, regulations, regulatory documents and the Articles of Associations and the actual situation of the Company.

• 2. Positions held by the Participants in the Company

  The Participants under the Incentive Scheme shall include the Directors (other than independent non-executive Directors), senior management personnel, middle management personnel, core technology (business) personnel and core cadres of the Company as considered by the Board having made contribution directly to the overall business performance and sustainable development of the Group.

(II).Participants to be covered

The total number of Participants proposed at the First Grant under the Incentive Scheme is 88, representing 0.27% of the total employees of the Company as at 31 December 2020, which comprising:

• 1. the executive Director, senior management personnel;

• 2. middle management personnel, core technology (business) personnel;

• 3. core cadres having made contribution directly to the overall business performance and sustainable development of the Group.

The detailed list of Participants and their respective allocation shall be determined by the Board and reviewed by the supervisory committee, subject to the relevant procedures in the event of approval at the general meeting, A Share class meeting and H Share class meeting is required.

None of the Participant under the Incentive Scheme is an independent non-executive Director, supervisor, Shareholder individually or collectively holding more than 5% of the Shares or actual controller and their respective spouse, parents or children.

The Director and senior management personnel of the Company among the above Participants were elected at the general meetings of the Company or hired by the Board. All Participants must be employed or hired by the Company or its Subsidiaries during the term of the Incentive Scheme and at the time of grant thereunder.

The Participants for the reserved shares to be granted shall be determined within 12 months from the date on which the Incentive Scheme is considered and approved at the general meeting, A Share and H Share class meetings of the Company. Following the proposals from the Board, issue of clear opinions by the independent non-executive Directors and the supervisory committee of the Company as well as issue of professional opinions and legal opinions by the legal advisers, the Company shall promptly and accurately disclose the relevant information on such Participants on the designated website pursuant to the relevant requirements. The reserved entitlements shall become invalid where the Participants for the Reserved Grant are not determined after 12 months from the aforesaid date. The basis for determining the Participants of the Reserved Grant shall be ascertained with reference to the basis of the First Grant.

(III). Allocation of the Restricted Shares to be granted to the Participants

Subject to the results of the Company's internal announcement of the name and position of the Participants, the allocation of the Restricted Shares under the First Grant of Incentive Scheme among all Participants is set out in the table below:

Proportion

Number of	in the total	Proportion
Restricted	number of	of Restricted	Proportion
Shares to	shares to be	Shares in the	of Restricted
be Granted	granted under	total share	Shares in the
#	Name	Position	(0'000 shares)	First Grant	capital	total A Shares
1.	WU Yifang*	Executive Director,	24.04	10.51%	0.00938%	0.01195%
chairman and chief
executive officer (CEO)
2.	LIU Qiang*	Senior assistance to CEO	13.11	5.73%	0.00512%	0.00652%
3.	WANG Kexin*	Co-president	13.11	5.73%	0.00512%	0.00652%
4.	LI Dongming*	Co-president	13.11	5.73%	0.00512%	0.00652%
5.	GUAN Xiaohui*	Executive president and	13.11	5.73%	0.00512%	0.00652%
chief financial officer
(CFO)
6.	MEI Jingping	Senior vice president	8.74	3.82%	0.00341%	0.00435%
7.	WEN Deyong*	Senior vice president	8.74	3.82%	0.00341%	0.00435%
8.	WANG Donghua	Senior vice president	8.74	3.82%	0.00341%	0.00435%
9.	LI Dongjiu	Senior vice president	8.74	3.82%	0.00341%	0.00435%