Pharmaniaga Berhad : Key Matters Discussed at the 24th AGM

SUMMARY OF KEY MATTERS DISCUSSED AT THE 24TH ANNUAL GENERAL MEETING

("AGM") OF PHARMANIAGA BERHAD ("PHARMANIAGA" OR "THE COMPANY") CONDUCTED ENTIRELY THROUGH LIVE STREAMING FROM THE BROADCAST VENUE AT THE ROYALE CHULAN DAMANSARA, ROYALE BALLROOM, SECOND FLOOR, NO.2, JALAN PJU 7/3, MUTIARA DAMANSARA, 47810 PETALING JAYA, SELANGOR DARUL EHSAN ON MONDAY, 13 JUNE 2022 AT 9.30 A.M.

PRESENT:
1.	Shareholders	-	As per the Attendance List.
2.	Proxy Holders	-	As per the Attendance List.
DIRECTORS PRESENT AT BROADCAST VENUE:
1.	YBhg. Datuk Seri Zainal Abidin Mohd	-	Chairman / Non-Independent Non-
Rafique		Executive Director
2.	YBhg. Datuk Zulkarnain Md Eusope	-	Managing Director
3.	YBrs. Encik Zulkifli Jafar	-	Executive Director
4.	YBhg. Dato' Sri Mohammed Shazalli	-	Non-IndependentNon-Executive
	Ramly		Director
5.	YBhg. Dato' Dr. Najmil Faiz Mohamed Aris	-	Independent Non-Executive Director
6.	YBrs. Dr. Abdul Razak Ahmad	-	Independent Non-Executive Director
7.	YBrs. Sarah Azreen Abdul Samat	-	Independent Non-Executive Director
DIRECTORS PRESENT VIRTUALLY
1.	YB. Senator Datuk Dr. Azhar Ahmad	-	Independent Non-Executive Director
2.	YBrs. Encik Izaddeen Daud	-	Non-IndependentNon-Executive
			Director
MANAGEMENT PRESENT AT BROADCAST VENUE
1.	Encik Mohamed Iqbal Abdul Rahman	-	Deputy Managing Director
2.	Puan Norai'ni Mohamed Ali	-	Chief Financial Officer
2.	Puan Wan Intan Idura Wan Ismail	-	Company Secretary
IN ATTENDANCE (PHYSICALLY):
1.	Mr. Herbert Chua	-	Representing External Auditors,
			PricewaterhouseCoopers PLT

Summary of Key Matters Discussed at Pharmaniaga Berhad 24th AGM

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1.0 Fully Virtual 24th Annual General Meeting Proceedings:

The 24th Annual General Meeting ("AGM") was fully conducted virtually in accordance with the provision of Section 327 of the Companies Act 2016 and pursuant to Clause 84 of the Company's Constitution.

The Company's 24th AGM proceeding was in accordance with the latest update by the Securities Commission dated 7 April 2022 in relation to the Guidance Note and FAQs on the Conduct of General Meetings for Listed Issuers ("SC's Latest Update"). It was held in a virtual manner, in the broadcast venue at the Royale Ballroom, Royale Chulan Damansara as part of the Company's effort to safeguard the wellbeing of the shareholders and employees.

According to the SC's Latest Update, under Section 327 of the Companies Act 2016, the main venue of the meeting must be in Malaysia and the Chairperson shall be present at the main venue of the meeting. Online meeting platform can be also be recognized as the meeting venue or place as stated under Section 327(2) of the Companies Act 2016 provided that the online platform is located in Malaysia.

1. OPENING ADDRESS

The Chairman welcomed all members to the 24th Annual General Meeting of the Company.

The Chairman proceeded to remind all shareholders who joined the meeting remotely that all discussions are deemed confidential and only for the knowledge of shareholders of the Company and that any audio and visual recording are strictly prohibited unless with Company's written consent.

During his opening address, the Chairman highlighted to the shareholders that with all the challenges in 2021, the Group has delivered a record performance for the financial year ended 31 December 2021. The Company posted its highest ever net profit of RM172.2 million, increasing by over sixfold from RM26.3 million in 2020.

Based on the Company's commendable performance, the Board has declared a dividend of 9.3 sen per share or a total dividend pay-out of RM121.8 million.

The Chairman then stated as a result of the Covid-19 pandemic, the Company has established a biopharmaceutical plant in Malaysia to conduct the fill and finish vaccine for the nation. On top of that, through the Company's partnership with Sinovac Life Sciences Co Ltd of China, the Company has successfully delivered almost 12 million doses of the Covid-19 vaccine to the Malaysian Government as well as to the private sector which in turn saw Malaysia having one of the fastest vaccination rates in the world during the peak of the pandemic.

The Chairman also further stated that although it was an arduous challenge being tasked to manufacture and deliver the vaccine within a short timeline, the task was successfully accomplished, due to the strong technical capabilities and perseverance of the management and employees.

From a long-term perspective, the Group remains positive on its outlook. The Company has its sight strongly focused on expanding its capabilities in the biopharmaceutical field, by forging strong partnerships with renowned international biopharmaceutical organisations, thus enhancing research and development work in this field. These activities will fortify the Company's plan to further expand its ventures in the biopharmaceutical industry, including the setting up of the world's

first Halal vaccine plant by 2023.

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As the Company move forward into the new year, the Chairman said that the Company is conscious of the need to strategize its future growth, given the rapidly changing economic and socio-economic climates resulting from the Covid-19 pandemic.

The Company will adapt to the new norm resulting from the pandemic and will leverage on technology to further transform the way business are conducted in order to meet the expectation of the shareholders. The Company will continue to provide quality products and services while looking out for new opportunities of growth in terms of both the range of the Company's products as well as the efficiency of services.

Before concluding his opening remarks, the Chairman took the opportunity to thank the former Chairman, Dato' Seri Mohammed Shazalli Ramly, who is currently appointed as the Company's Non-IndependentNon-Executive Director, for his immense contributions to the Company during his tenure as Chairman in 2021.

2. PRESENTATION BY THE MANAGING DIRECTOR ("MD")

The MD briefed on the financial performance of Pharmaniaga and its subsidiaries ("the Group") for the financial year ended 31 December 2021.

Financial Highlights

For the financial year 2021, the Group recorded the strongest profit before zakat and taxation of RM277.1 million as compared to RM35.8 million in the year 2020, mainly due to the supply of Covid-19 vaccine to the rakyat. Consistent with the growth in profit before zakat and taxation, the Group recorded net profit of RM172.2 million, the highest in history of the Company.

The Board of Directors has also declared a fourth interim dividend of 5.0 sen per share, paid on 5 April 2022 to shareholders on register as at 8 March 2022 which brings total declared dividend for the year 2021 to 9.3 sen per share.

The MD also explained on the Group's 7 focus strategies as part of its re-invent initiatives as follows:

• First Strategy: Establishing Pharmaniaga as A Premiere In Integrated
  Logistics & Distribution

Pharmaniaga will be expanding its network of warehouses in Malaysia and Indonesia. The new warehouses will be equipped with hi-tech capabilities to ensure faster turn-around time, from order receiving to goods delivery.

Pharmaniaga is also currently exploring potential acquisition to further leapfrog its presence in this segment. The Group will make the necessary announcement once a significant milestone is achieved.

• Second Strategy: Accelerate Research & Development in Healthcare and
  Neutraceutical for Sustainable Growth
  Developing new products based on current and future market demands and trends will be the key to success in generating new streams of revenue.
  To achieve this, R&D will focus on high-value complex molecules as well as Over-the-Counter and supplement market.
  Pharmaniaga have announced partnerships with two Thai companies and are

in discussion with a few more potential international partners, for speedier new

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product development and commercialisation.

• Third Strategy: Expand into Biopharmaceutical Sector
  Pharmaniaga halal Vaccine and Halal Insulin manufacturing projects are progressing well, in line with the projected timeline and will be ready for commercialisation in 2024 and 2025.
  Pharmaniaga have signed partnership with world renowned Biopharma partners including Serum Institute of India, BioNet Asia of Thailand, SK BioScience from Korea and Biological E of India, to name a few.
  Pharmaniaga has also identified a few other products within this sector, to maximise plant operations and growth opportunities, and currently conducting feasibility of manufacturing these products.
• Fourth Strategy: Transform Into a Household Brand
  With aggressive Advertising and Promotion activities, Pharmaniaga's OTC and supplement products have seen significant market growth.
  With Malaysia and the world moving into normalising daily life, the Group foresee OTC and supplement will continue to grow, and the Company will continue with its aggressive marketing and introduction of new products, to become a dominant player in the market.
• Fifth Strategy: Strengthen Footprints in International Ventures Via Focus
  Countries
  Tapping into Indonesia's 270 million population with the support of the Company's Logistics infrastructure provided by PT MPI and PT Errita's manufacturing capabilities will be the Company's core focus.
  The improved performance in the Company's Indonesian operations will continue to grow with the corporate restructuring exercise that is well underway.
  Pharmaniaga will leverage on Malaysia's high standard of PIC/S and GMP, coupled with our Halal compliant manufacturing sites, to penetrate more international markets. In this regard, Pharmaniaga have appointed partners to register and market its products in South East Asia, Europe, Middle East as well as African continent.
• Sixth Strategy: Accelerate Digitalisation And Fit For Purpose Innovation
  Pharmaniaga has embarked and will continue to invest into digitisation. The Company's past digitisation effort in developing Pharmacy Information System (or PhIS), and the supporting system, has paid off as there were zero interruption during the MCO in the orders transmission and fulfilment activities to the 1,200 Government Hospitals and Clinics.
  Pharmaniaga will continue to embark on new innovations including new medium of transportation.
  The Company have planned for drone deliveries to small clinics in islands like Pangkor and Tioman, clinics in remote locations for example Pulau Banding in Perak, Long Pasia in Sabah and Belaga in Sarawak, and currently working with partners for a pilot implementation.

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Pharmaniaga is very committed in Enviromental, Social and Governance (or ESG) drive and pursuing projects in various areas to support this. In-line with this, the Company will be pursuing usage of Electric Vehicles (or EV), both electric lorries and motorcycles to deliver products to the customers.

1. • Seventh Strategy: Reinforce Human Capital Yhrough Capability Building for
     Superior Performance
     Pharmaniaga's strategy to prioritise local employment has paid off as it were not impacted by the recent foreign labour shortage issues. The Company will continue to hire and develop local talents to build a solid succession plan and build a culture of excellence through training and development.
     The Company will also expand our technical team especially the scientists involved in R&D, manufacturing and regulatory activities to support expansion in the new high-tech BioPharma sector.
     To support this, Pharmaniaga are in the midst of forming a Scientific Advisory Group by engaging internationally renowned experts to advise on best practices and build access to international markets.
2. MATTERS RAISED BY THE MINORITY SHAREHOLDER WATCHDOG GROUP ("MSWG")
   A copy of the question and answer discussed via letter dated 3 June 2022 from Pharmaniaga to MSWG is annexed hereto as Appendix A.
3. QUESTIONS RAISED BY SHAREHOLDERS
   A copy of the questions and answers raised by shareholders (prior and during the AGM) is annexed hereto as Appendix B.
4. RESOLUTIONS PASSED
   Details of the resolutions passed are as follows:

NO	RESOLUTIONS		VOTE FOR	VOTE AGAINST	RESULTS
					NO OF	%	NO OF	%
					SHARES		SHARES
1.	Ordinary	Resolution	1	809,545,512	99.661	2,754,032	0.339	Carried
	Re-election of Dato' Dr
	Najmil Faiz Mohamed
	Aris
2.	Ordinary	Resolution	2	809,451,843	99.650	2,842,702	0.350	Carried
	Re-election	of	YB
	Senator	Datuk	Dr Haji
	Azhar Ahmad
3.	Ordinary	Resolution	3	813,887,273	99.955	368,272	0.045	Carried
	Re-election of Encik
	Zulkifli Jafar
4.	Ordinary	Resolution	4	809,975,991	99.715	2,313,554	0.285	Carried
	Re-election of Datuk Seri
	Zainal	Abidin	Mohd
	Rafique

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