Bafna Pharmaceuticals Ltd Management Discussions.

Management Discussion and Analysis Report, as required under the Listing Agreement with the Stock Exchange is enclosed in the Annual Report and forms part of this Report. Certain Statements in the report may be forwardlooking. Many factors may affect the actual results, which could be different from what the Directors envisage in terms of future performance &. outlook.

Extract of Annual Return:

The details forming part of the extract of the Annual Return in form MGT-9 is annexed along with the Directors Report.

Number of Board Meetings:

The Board of Directors met 13 times during the year under review and the gap between 2 meetings did not exceed 120 days.

Directors Responsibility Statement

Your Directors wish to inform that the Audited Accounts contains Financial Statements for the financial year ended 31^st March, 2017 are in full conformity with the requirements of the Companies Act, 2013. They believe that the Financial Statements reflect fairly the form and substance of transaction carried out during the year and reasonably present your Companys financial conditions and result of operations.

Your Directors further confirm that in preparation of the Annual Accounts:

• The applicable accounting standards had been followed and wherever required, proper explanations relating to material departures have been given;

• The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the loss of the Company for that period;

• Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

• The Accounts have been prepared on a "going concern" basis.

• The directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

• The directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively

Acknowledgement and Appreciation

Your Directors would like to thank Companys Bankers - SBI, EXIM, DBS, DCB, BOC 8t 1DBI for their continued support and they would also like to express their gratitude for the co-operation and assistance extended to the Company by its Customers, Suppliers, Technical Consultants, Contractors, Government and Local Authorities, etc. The Directors also wish to thank all its Shareholders for their unstinted support. The Directors would like to sincerely thank and place on record their appreciation of the consistent and dedicated services of the employees at all levels who have immensely contributed to the performance of the Company during the period under review.

On behalf of the Board of Directors

For BAFNA PHARMACEUTICALS LIMITED

(CIN L24294TN1995PLC030698)

Disclosure of particulars with respect to Conservation of Energy A. Conservation of Energy

The company is conscious of its responsibility to conserve the energy and has taken measures in relation to conservation of energy and technology absorption. No additional investments have been made during the year.

B. Consumption per Unit of Production:

In view of number of products with different sizes, shapes & other parameters, being manufactured by the company, it is not practicable to give information on consumption of fuel per unit of production.

(a) Specific areas in which R&D is carried out by your company

R&D is a process intended to create new or improved technology that can provide a competitive advantage to our business. Also focusing on process development for improving operational efficiency.

During the year the company has received prestigious DSIR (Department of Science and Industrial Research) certification for our R&D centre. DSIR is a department under the Ministry of Science and Technology, Government of India.

• Product Development and report of new formulations. ‘

• Stability studies of new formulations as per ICH guidelines

• Technology Transfer and Process validation of new formulations

• Technology Transfer and Analytical method validation of new formulations

• Dossier preparation for regulatory approval

• Registration of Products in various countries with respective regulatory requirements

• Trouble shooting in existing Products

• Filed patents of Chewable Raricap tablets

• Bioavailability studies to confirm therapeutic efficacy

(b) Benefits derived as a result of the above

• these give us a unique selling point (USP) & then patents can be acquired for these products

• R&D is able to build business advantage over its competitors by bringing innovative products

• Improving Quality of existing drug products in the market to deserve a good market output

• Attracting more customers and scope for new business

(c) Future plan of action

• To enhance the quality and efficacy in all our medical formulations

• To achieve and maintain consistency in quality

• Upgrading of new process and product technology to improve product stability and efficacy

• To upgrade green technology for process and manufacturing operations

• Product development for new customers, Product registration for regulated and emerging markets

• Technology transfer and stability studies

a) Efforts in brief, made towards technology absorption, adaptation and innovation:

With latest technology, its development & up-gradation enable us to provide technically superior, process efficient and International standards product.

The company has its own R&D centres which have been developing and improving process for manufacture of Delayed release tablets, Sustained Release Tablets, Orally Disintegrating Tablets, Liquid orals, Syrups, Suspensions & Dry Syrup formulations.

• The R&D centre has been upgraded and adopted various methods of drug particle coating with a gastro- resistant polymers of various genre to improve drug safety and efficacy and technology is absorbed into process scale up of branded generics with innovative methodologies involving combination with taste masking technology (with Ion-Exchange resins) - for producing efficacious generics with highly taste masked bitter drugs.

• The R&D centre also absorbed and adopted innovative techniques of Multi-layer Coating technology which is subjected to scale up levels to produce stable and effective dosage forms - especially applicable for drug products that are pH sensitive and for intestinal release and gastric resistance.

• Participating and Collaboration with scientific conferences and research institutions for the development and further research of new drug formulations and novel technologies

• Procuring scientific journals and standard pharmacopoeia editions for the R&D library upgrade.

• Collaborations with institutions in providing research related guidance and facilities to intern scholars.

b) Benefits derived as a result of the above efforts:

• Control of drug therapy is achieved

• Drug administration can be made convenient

• The safety margin of high potency drug can be increased

• Drugs with shorter half-life can be given in less frequent dose with better compliance

• Less fluctuating blood plasma concentrations

• Bioavailability enhancement of poorly soluble drugs

• Targeting drug delivery at most absorbing sites to improve bioavailability

• Reduction of adverse effects due to avoidance of dose dumping

• Rapid onset of action can be achieved

• Taste masking of bitter oral liquid drug formulations

c) Details of technology imported during the last 5 years

No technology has been imported during the past five years.