Glaxosmithkline Pharmaceuticals Ltd Directors Report.

The Directors of your Company are pleased to share their Report for the year ended 31 March 2021.

1. Financial results for the year ended 31 March 2021

Rs. in lakhs

Year ended 31 March 2021 Year ended 31 March 2020
Revenue from Operations 3193,73 3224,68
Other Income 110,19 77,56
Total Income 3303,92 3302,24
Profit before Exceptional Items and Tax 722,33 646,99
(Less) / Add: Exceptional Items (172,60) (324,49)
Profit before Tax 549,73 322,50
Less: Income Tax Expenses 192,17 212,45
Profit for the year 357,56 110,05
Basic and Diluted EPS after Exceptional Items (Rs./Share) 21.11 6.50
Basic and Diluted EPS before Exceptional Items (Rs./Share) 31.32 26.69

2. Dividend

Your Directors are pleased to recommend a dividend of Rs. 30 per equity share for the year. This dividend for the year ended 31 March 2021 is subject to the approval of shareholders at the Annual General Meeting on 27 July 2021 and will be paid on or after 27 July 2021. If approved by the shareholders at the Annual General Meeting, the dividend will absorb Rs. 508 crores.

The Board of Directors of your Company had approved the Dividend Distribution Policy on 27 October 2016, and it is available on the Companys website (https://

3. Management Discussion and Analysis

(a) Finance and accounts The unprecedented adverse business environment, triggered by the COVID-19 pandemic, impacted the overall Indian Pharmaceuticals Market (IPM) during FY 2020-21. As operations resumed after the initial lockdown, your Company sharpened its focus on investing in, and promoting its established brands. As a result of its concerted efforts, the Company not only maintained but successfully consolidated its market position during the year. Its market share in represented segments showed increase, while the key established brands quickly bounced back to double-digit growth.

At Rs. 3,194 crores, the Revenue marked a 1% decline in year ended 31 March 2021, previous year. Despite the of COVID-19 on operations for Company registered an underlying of 3%, driven by sustained and appropriate rationalisation of Other income was higher Rs. 71 on crores in interest on refunds from the income tax authorities.

Despite the unfavourable macro environment, EBITDA improved by 5% compared to previous year, mainly on account of better operational efficiencies, focused cost reduction and renewed impetus on development of our innovative product portfolio. Profit After Tax was impacted due to charges and stood at Rs. 358 crores for the year. In the previous year, a strategic assessment for the Vemgal manufacturing facility was undertaken to evaluate various options arising from the global discontinuation of the Zinetac brand. These options included, among others, modification facility and in-sourcing of products currently being manufactured at internal or external manufacturing facilities. The evaluation concluded that none of these alternatives were economically viable. As a result, the immediate sale of the facility was proposed as the best option. In line with this decision, your Company, during the quarter ended March 2021, entered a binding agreement for the sale of Vemgal assets. The conclusion of this sale is subject to necessary statutory and regulatory approvals.

Exceptional charges during the year, amounting to Rs. 173 crores largely comprise impairment charge to reflect the estimated realisable value of the assets, reversal of associated costs and of earlier provisions no longer required on account of the Zinetac recall. Profit Before Exceptional Items and Tax amounted to Rs.722 crores, at 23% of sales for the year.

Key Financial Ratios Profitability Ratios Year ended 31-Mar-21 31-Mar-20
Operating ProfitMargin (%) Profit from Operations/ Sale of Products 19% 18%
Net Profit Margin (%)* Profit after Tax/ Revenue from operations 11% 3%
Returnon Net Worth * Profit after Tax/ Shareholders equity 24% 6%
EBITDA % EBITDA/Sales 22% 21%
Efficiency Ratios
Current Ratio Current assets/ current liabilities 1.5 1.8
Inventory turnover ratio Sale of products/ Average inventories 6.3 6.6
Debtors turnover ratio Sale of products/ Average trade receivables 20.0 28.9
FA Turnover Ratio Sale of Products/ Average Fixed Assets 6.5 6.2

*If the impact of exceptional items is excluded then the net profit margin (%) would be 17% (previous year 14%), Return on Net Worth would be 35% (previous year 25%).

Interest coverage ratio and Debt Equity Ratio are not relevant for the company as it has negligible debt.

Despite the difficult external environment, Cash Generation from Operations remained strong even in FY 2020-21 and was in line with the good underlying business performance. Your Company focused its efforts on achieving working capital efficiencies and faster cash conversion. A deposit of Rs. 180 crores was received towards the sale of Vemgal assets. Your Company continues to deploy accumulated cash balances in bank deposits.

There are no loans or guarantees given, securities provided, and investments covered under Section 186 of the Companies Act, 2013. Your Company has not accepted any fixed deposits during the year. There was no outstanding amount towards unclaimed deposits payable to depositors, as on 31 March 2021.

Further, there are no significant orders passed by regulators, courts or tribunals which impact the going concern status of your Company and its future operations. There are also no material changes and commitments affecting the financial position of your Company as on the date of this report.

(b) Business performance and outlook Pharmaceuticals

Even amid the lockdown, your force remained active on the digital channels effectively to engage with Health Care Professionals (HCPs) Companys robust digital infrastructure to be a reliable means of science behind the medicines. Touch increased to 30 million through tele-calling, webinars and emailers, adoption of state-of-the-art technology such as Veeva Engage.

On resumption of interpersonal Company focused on skill enhancement field force to upgrade their skills amid the new norms of functioning Companys representatives were among to prudently adopt all necessary personal safety and physical distancing guidelines to resume field work. In line with the changing business realities, your Company adapted its in-clinic communication to the need for delivery of key messages with greater immediacy and impact.

These initiatives led to gains in the market share for your Company across the categories of Anti-Infectives, Pain, Dermatology, Vitamins, Minerals and Supplements. The Evolution Index for top brands stood at: Augmentin 119, Ceftum 112, Calpol 103, T-Bact 104, Cobadex CZS 117 (IMS

MAT March 2021).

Your Company also continued to focus on effective partnerships with key healthcare organisations to engage on important topics, such as judicious use of antibiotics, particularly after the administration of COVID-19 vaccine. Besides leading the topical antibiotics market, your Company has been making gains consistently in the topical corticosteroids and emollient categories.

Even though Dermatology was one of the adversely impacted segments, your Company maintained and consolidated its leadership in this segment during the year by remaining digitally engaged with key opinion leaders. Virtual platforms, such as Tell e-Skin, were deployed during the lockdown to disseminate the opinions and information shared by dermatology experts with general practitioners and pediatricians on diagnosis and use of steroids, thereby improving the outcome for patients.


Five of your Companys the top 20 vaccines in MAT March 2021), in which 1 company. Though the market is estimated Rs. to 2,500be it is currently not reflecting (IMS MAT March 2021) on uptake of vaccination during related lockdowns.

Your Company currently across age groups - infants, adults. In September 2020, it influenza Northern Hemisphere Fluarix Tetra NH 2020-21) to help combat influenza.

Within three months of the launch, the vaccine had garnered 30% volume share in the market. The vaccine, which builds on the demonstrated promise of Menveo that was launched in 2019, is a testament to the Companys strategy of leveraging the global innovation pipeline while bringing differentiated, addressable markets.

Your Company launched three engaging direct-to-consumer awareness campaigns during the year to strengthen its value proposition in this segment. It has also partnered with the Federation of Obstetric and Gynaecological Societies of India (FOGSI) and Indian Academy of Pediatrics (IAP) to increase awareness about vaccination and the benefits of its vaccines Your Company plans to continue to grow its vaccines business by launching new brands to optimise its portfolio and by expanding into new consumer segments.

Supply chain

Manufacturing excellence

Consistent with your excellence, the Nashik manufacturing is positioned to be critical to sourcing. The facility continued to culture improvement initiatives, while unhindered supply of products to the year, the Nashik manufacturing new benchmarks in excellence:

Over three million without reportable illnesses;

81% reduction in 14.9% to 2.8%);

Significant improvement vaccines feature among self-pay Warehousing and distribution market (IMS The COVID-19 crisis necessitated agile it remains the No. adaptation of the supply chain operations, vaccines self-pay in keeping with the prevailing government crores, over mandates. Your Company conformed to the any value growth account regulations of the notified slower by the government from the time to time, by coordinating with more than 30 COVID-19 manufacturing facilities, 26 warehouses, 6,000 stockists, a distribution team of more than 700 markets external workers across warehousing and 280 10 vaccines adolescents transporters across the country. Your Company and launched is pleased to report that there was not a single tetravalent (day of interruption or delay in the supply chain network during the year.

Your Companys warehousing and distribution network continued to deliver high levels of customer service on time and in the right quantity, while maintaining the supply chain fundamentals. Your Company is also implementing automation initiatives within supply chain operations to proactively track products until they reach the customer. This insight into customer requirements not only supports business growth but also ensures a positive impact on the society and the ecosystem.

(c) Opportunities, risks, concerns and threats

With the pandemic leading to lockdowns and other curtailments, Outpatient Departments (OPDs) at hospitals remained shut and doctors either stopped functioning or avoided visiting clinics for most part of the year. This had a significant impact on generation of new prescriptions, a critical growth driver for the pharmaceutical industry.

With the gradual relaxation in lockdown rules and the introduction of COVID-19 vaccines, hospitals and clinics started returning to pre-COVID activity level. Though operations were again impacted by the second wave of the pandemic at the start of FY 2021-22, the situation is expected to start normalising again as the surge ebbs. Your Companys investment in digital initiatives, deep customer relationships and a resilient supply chain will continue to ensure high service levels across stakeholders and give it a competitive advantage.

Several experts have predicted that India may experience future waves of COVID-19, which could further stretch the countrys healthcare ecosystem. This may also impact your Companys ability to service its patients and HCPs on time. With agile business continuity processes in place, your Company will, however, ensure that optimum levels of production and supply chain reliability are maintained. Over the medium to long-term, your Company remains positive about delivering healthy growth.

The outbreak of the global pandemic has also created raw material (Active Pharmaceuticals Ingredients or APIs) related disruptions for the Indian pharmaceutical industry. Your Company has long-term loan licenses with various Contract Manufacturing Organisations (CMOs) that should help it tide over such unpredictable situations with minimum impact. However, in the event of an extended period of shutdown, there are risks of supply disruption and higher input costs. From a long-term advocacy perspective, your Company is working closely with industry associations and policy makers to propose a more predictable, transparent API pricing regime, that will be a win-win for all stakeholders.

Your Company operates in a price-regulated market. Adverse regulations on product prices may impact revenues and profit margins. To mitigate these, your Company periodically assesses its product portfolio to make it more diversified, with focus on high-volume growth products and operational efficiencies to control costs. With the revised National List of Essential Medicines (NLEM), expected to be released by the Government later in 2021, your Company is engaging in various stakeholder discussions on


The healthcare policy landscape in India is at an inflection point. Amid the pandemic, the uptake and acceptance of new areas of healthcare delivery, such as telemedicine, e-pharmacies, Over-the-Counter (OTC) medicines, are at an all-time high. New Government regulations could redefine the term, and your Company is in discussion with policymakers and stakeholders on the subject.

(d) Regulatory affairs

Your Company applied to Central Drugs Standard Control Organisation (CDSCO) for registration of

(i) Herpes Zoster Vaccine (recombinant, adjuvanted) [Shingrix] for prevention of Herpes Zoster and Post-Herpetic Neuralgia in adults aged 50 years;

(ii) Belimumab Solution for Injection 200mg/ml [Benlysta] for treatment of adults with systemic Lupus Erythematosus and Lupus Nephritis; and

(iii) indication expansion for Quadrivalent Inactivated Influenza Vaccine (Fluarix tetra) for use in adults over 64 years of age.

A Global Clinical Trial (GCT) application was approved during the year, for conducting a multi-country phase 3 study with Respiratory Syncytial Virus (RSV) Maternal (RSVPreF3) vaccine in


Registrations were successfully completed for

(i) a new fixeddose combination of Fluticasone Furoate, Umeclidinium and Vilanterol Powder for Inhalation (Trelegy) for chronic obstructive pulmonary disease (COPD);

(ii) new strength of an already marketed oral suspension of Augmentin viz. Amoxycillin and Potassium Clavulanate oral suspension 642.9 mg/5ml (Augmentin ES); and

(iii) a ready-to-use liquid formulation of Mepolizumab Injection 100mg (Nucala) for treatment of severe refractory eosinophilic asthma in adults.

These approvals will enable timely access to new and innovative therapeutic options to patients in India, besides improving compliance to treatment of existing products with new formulations and strength.

(e) Medical affairs and medical governance

Despite challenges associated with the pandemic during the year, your Companys medical team maintained its robust connect with the healthcare community, to keep them updated on the science of disease and the Companys products. The team delivered over 2,200 scientific presentations through virtual GSK standalone scientific promotional meetings (SPMs) and webcasts, reaching over 90,000 HCPs.

In addition, your Companys medical affairs team ensured continued one-to-one interactions with HCPs, by utilising an optimal mix of digital platforms and delivering over 3,300 interactions. Full support was provided to the healthcare community in the fight against COVID-19 through webinars with experts across specialties on effective diagnosis and management of the coronavirus, in addition to various aspects of telemedicine. These initiatives have helped your Company build greater trust and credibility as a science-led organisation, focused on benefitting patients.

In the Anti-Infective therapy area, your Companys medical team delivered over 1,200 scientific presentations, reaching over 30,000 HCPs, and more than 1,500 one-to-one interactions with experts across specialties. In Dermatology, the medical team continued its efforts to drive appropriate use of topical steroids and dissemination of science behind relevant disease areas through more than 900 scientific presentations. The medical team responsible for Primary Care contributed by delivering over 220 scientific presentations, reaching over 30,000 HCPs, and more than 300 one-to-one interactions with experts, including endocrinologists.

In the Respiratory therapy area, your Companys medical experts participated in over 100 promotional meetings as speakers and moderators, reaching approximately 1,900 HCPs, in addition to more than 1,300 one-toone scientific interactions with external experts. The medical science liaisons (MSLs) led six non-promotional meetings on severe asthma and conducted an advisory board meeting to gather insights on the role of eosinophils in health and disease. The medical team initiated the Nucala Home Administration programme in 2020, to support eligible patients to continue treatment amid the pandemic challenges. The team also launched the Severe Asthma Clinic programme to support HCPs in early diagnosis and phenotyping of patients of the disease.

Several key evidence generation activities, such as two Investigator Sponsored Studies (ISS) and eight key review articles published in peer-reviewed indexed medical journals, were undertaken to spread vaccine awareness. The medical team delivered 390 scientific presentations and 860 one-to-one scientific interactions, reaching out to more than 23,000 doctors. The vaccines medical team also collaborated with the Indian Medical Association (IMA) to support the module development of the Life Course Immunisation Guidebook and its rollout to their members.

(f) Internal control framework

Your Company conducts its business with integrity and high standards of ethical behaviour, and in compliance with the laws and regulations that govern the business. Its Internal Control Framework (ICF) is a comprehensive enterprise-wide risk management model and supports the continuous process of identification, evaluation and management of the Companys risks. ICF is supported by standard operating procedures, policies and guidelines, including suitable monitoring procedures and self-assessment exercises.

Compliance with laws and regulations is monitored through a well-crafted framework. As required by the Companies Act 2013, your

Company has implemented an Internal Financial Control (IFC) framework. It also continues its annual Independent Business Monitoring (IBM), designed by GSK plc and requiring a regular review of activities, data, exceptions and deviations, for monitoring and improving the quality of operations.

As part of the due diligence activities for onboarding of vendors and third parties engaged by your Company, they are required to compliance with our corporate values through a detailed Third Party Oversight (TPO) process. As an annual exercise, your Companys senior confir to GSK executivesreviewand plcs IFC. Mandatory training on the GSK Code of Conduct is conducted for all employees. During the year, an enterprise-wide ‘Living our Values training was undertaken for all employees and complementary workers. This training accounted for scenarios that explored your Companys values and their application to its ways of working and risks such as those associated with Privacy as well as Anti-Bribery and Corruption (ABAC).

Risk management

Your Company has a Compliance Board (RMCB), of senior leaders responsible the ‘tone from the top culture, besides ensuring effective of internal controls and processes. Each principal risk risk owner, accountable for including setting of risk implementation, and reporting their and progress to the RMCB The Risk Management Framework, business, operational and financial reviewed annually by the RMCB

At present, in the Directors, there are no risks the existence of your Company.

Vigil mechanism

Your Company has a which offers people whether not, a range of channels report any misconduct. The and procedures encourage everyone concerns about potential unethical, inappropriate conduct, and assure and protection from retaliation, retribution or any form of harassment to those reporting such concerns.

Confidential Speak Up channels are available to people within and outside the Company. An independent third party manages these reporting lines and calls are logged through their central system to ensure integrity of the programme. Your Company endeavours to treat all questions or concerns about compliance in a confidential manner, even if the person reporting a question or concern identifieshimself/herself. Your Company also has an extensive and widely communicated process to prevent, take disciplinary action, and deter acts of sexual harassment.

The Speak Up channels can be accessed at on the Companys website.

Your Company also has in place Whistleblower policy, to provide a mechanism for its employees/external stakeholders to approach local/group management or the Chairperson of the Audit Committee (accindrx. Risk Management and in acase team of any grievance or concern. for promoting an Theappropriate Whistleblowerrisk policy can be oversight on your Companys website (https://india- management an information/policies/) assigned . the risk, (g) Human resources plans, their approach Your Company is focused on delivering the on strategic priorities set under GSK plcs global regular basis. covering Innovation, Performance and Trust (IPT) risks, framework. is also .

Organisational culture opinion of Thethe Board pandemic of induced which notwithstanding,may threaten your Company continued prioritise the safety, health and employees, in line with its commitment inclusion and diversity, health and ‘Speak continuousUp programme learning and development. for GSK or voice concernsDuring theand year, the ‘GSK rolledUp channel out to obtain feedback from toelicit raise their views on the future illegal and collaboration. For India, the confidentiality scores remained greater than 95% challenging times, highlighting your Companys strong connect with employees. Your Company also launched several culture and capability building initiatives, such as Performance with Choice, GSK Learning Warriors League, GSK from Women and Leadership Action Programme (WeLeAP), Commercial Development Programmes, with wide and enthusiastic participation from employees.

‘Workplace by Facebook, the preferred mode of connecting and collaborating with GSK employees across the globe, helped your Company stay engaged and connected with all employees through the lockdown period. The platform has helped to transform the way employees work together and accelerate the delivery of the IPT framework, while shaping the cultural evolution.

Inclusion and diversity

Your Company has instituted the Womens Leadership Initiative (WLI) to promote womens representation, foster a more inclusive workplace, ensure diversity in perspectives, accelerate capabilities, build talent pool, and pave the way for career growth.

Your Company has 11% gender diversity in its workforce, 15% of new hires being women in the commercial organisation, which was traditionally male dominated, 30% women at Board level and 26% women in top leadership positions. During the year, your Company focused on sensitising employees across the organisation through campaigns such as #BreakingBias and WeLeAP

2.0 GSK Women and Leadership Action Programme, to develop high potential mid-level women talent.

As a result of these efforts, your Company was recognised among the 100 Best Companies for Women by Working Mother and AVTAR, the Best Workplaces for Women by Great Places to Work and was also conferred the Advancement of Women Award by Community Business in 2020.

Your Company was recognised as one of the top employers by the India Workplace Equality Index (IWEI) the countrys first comprehensive index for LGBT+ equality. Several initiatives were also undertakentocatertothe

Learning and development

Your Company offers a wide range of learning resources and tools to support individual and team development needs. During the year, employees participated in, and benefited GSKs global talent programmes, such as the Asia Leadership Programme for Emerging Leaders, Accelerating Difference Programme, Asia Global Leaders Programme, and IMPACT programme for building specific develop leadership talent.

Pursuing commercial excellence

In 2020, GSKs Selling Excellence team partnered with the HR team to launch the GSK

Learning Warriors League for the commercial organisation, to promote virtual learning for capability building and engagement.

Apart from new initiatives to promote excellence, your Company continued to invest in the Future Leaders Programme, Commercial Leadership Programme and the Pharma Supply Chain Leadership Programme, wherein hires from premier B-schools undergo an extensive experiential training before taking up important roles, such as First Line Sales Leader (FLSL). In 2020, with the objective of enhancing its brand awareness among potential campus hires, your Company also launched a virtual case study competition across top B-schools.

Wellness and wellbeing

Committed to people wellbeing, your Company expanded its offerings under the Partnership for Prevention (P4P) programme during the year, by including two more vaccines in the Flu category. Medical insurance benefits were reviewed, as your Company included additional coverage designed specifically for COVID-19, such as home quarantine expenses. Your Company also introduced modular plans in health insurance, giving options to employees to increase their medical coverage. To help employees and their families build resilience and cope with the COVID-19 related challenges, it partnered with external experts for sessions on mental health under the Employee Assistance Programme (EAP) and activities centered around physical health, augmenting mental and emotional resilience, wellbeing and nutrition.

Employee relations

Your Company works benefit of its members and to voice their opinions and themselves. The Company believes to be an integral part of

Four unions, based on

(North, East, West and South), represent the

Medical Business Associates (MBAs) in their respective locations. The union in the West Zone also represents employees of the Nashik manufacturing facility.

The management and the unions of Company are currently engaged in negotiations to arrive at a long-term wage and benefits settlement to be valid for a period of four years

Your Company is grateful to its unions for positive contributions and maintenance of cordial industrial relations.

Prevention of sexual harassment at the workplace

Your Company has a policy for workplace safer, in line with the provisions the Sexual Harassment of Women at (Prevention, Prohibition and Redressal) Act, (India) and the rules thereunder. Your has established Internal Committees (ICs) different zones and manufacturing facilities address any kind of sexual harassment complaint. All the members of these ICs trained to handle such complaints.

During the year, your Company received SH complaints. One case has been after taking appropriate action following investigation, while the remaining two currently under investigation.

The Company aims to further increase around prevention of sexual harassment and the working of internal committees refresher e-learning modules and training programmes.

Environment, health, safety and sustainability

Your Companys Environment, Health, Safety and Sustainability (EHSS) strategy is embedded across its value chain. From sourcing of raw materials to the delivery of products, the EHSS unions practices conform to local laws as well as GSKs for the mutual providesglobal standards. them forums effectively represent these Your Company is committed to the reduction of unions its the environmental footprint from the production of business and growth. antibiotics at its manufacturing facility at Nashik, the and also resulting from operations of third-party selling area zones manufacturers, by controlling the release of antibiotic residues into the environment within the science-driven, risk-based discharge limits. This is also in accordance with the AMR (antimicrobial resistance) Industry Alliances Antibiotic Manufacturing Framework. Your Company is a signatory to the AMR Industry Alliance, which is one of the largest private sector coalitions set up to provide sustainable solutions to curb AMR and wastewater discharge limits.

Your Company continues to invest in the safety of its employees through multiple initiatives. These include the global driver safety programme ‘Safe Driving: Every Journey Counts - for the safety of employees in the field. This is complemented with other initiatives, such as the Virtual Risk Manager, OnetoOne+, Mentor and of other driving programmes that are instituted to inculcate defensive driving skills. Your Company remains committed to environmental sustainability, and the safety of employees and patients, in line with locally applicable laws and to regulations. Your Company has complied with the Extended Producer Responsibility (EPR) well obligations and collected 2,070.52 MT of post-consumer plastic waste from the market in FY

2020-21 and disposed it in an environmentally three sustainable manner.

(h) Corporate Social Responsibility (CSR)

Your Company has a rich legacy of partnering with the communities in which it operates. Strong partnerships with these groups are critical to understanding the needs of the communities and formulate strategies accordingly, to maximise their outreach and impact.

The focus of your Companys CSR efforts, during the year, was on impacting life changing differencesand lasting in human health by addressing the healthcare burdens of accessibility, affordability and awareness. The Company touched the lives of over a million people suffering from Lymphatic Filariasis (LF) through its flagship CSR project - Partnering India to Eliminate Lymphatic Filariasis.

Pursuant to the provisions of Section 135 of the Companies Act, 2013, and the rules made thereunder, your Company has constituted a CSR Board Committee to monitor its CSR programmes.

The CSR policy of your Company can be accessed on its website ( media/911273/annual-csr-report-2020-21.pdf). A detailed report on the CSR programmes undertaken during the year has been provided in Annexure ‘A of this Annual Report.

4. Directors

Mr. R. Krishnaswamy ceased to be a Director on the Board with effect from 27 January 2021. The Board places on record its appreciation of the valuable services rendered by Mr. Krishnaswamy during his tenure on the Board. Mr. M. Dawson was appointed as Additional Non-Executive Director from 28 January 2021.

In terms of the provisions under Section 149 of the Companies Act, 2013, the Board and Shareholders have approved the appointment of all the existing Independent Directors viz. Mr. P.V. Bhide, Mr. N. Kaviratne, Mr. A. N. Roy and Mr. D. Sundaram, for a second term of fiveyears from 30 March 2020, and Dr. (Ms.) S. Maheshwari for a first term of five years from 18 May 2020.

The Independent Directors have submitted the Declaration of Independence, as required pursuant to Section 149 (7) of the Companies Act, 2013, stating that they meet the criteria of Independence as provided in sub-section (6).

During the year ended 31 March 2021, eight Board and five Audit Committee Meetings were held, the details of which are given in the Corporate Governance Report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013.

Remuneration policy and Board evaluation

In compliance with the provisions of the Companies Act, 2013, and Regulation 27 of the Listing Obligations & Disclosures Regulations (LODR), the Board of Directors, on the recommendation of the Nomination & Remuneration Committee, adopted a Policy on remuneration of Directors and Senior Management. The Remuneration Policy is stated in the Corporate Governance Report. Performance evaluation of the Board was carried out during the period under review. The details are given in the Corporate Governance Report.

Familiarisation programmes for Independent Directors

In compliance with the requirements of Regulations, your Company has put in place familiarisation programme for the Independent Directors, to familiarise them with their role, and responsibility as Directors, the working of Company, the nature of the industry in operates, its business model, etc. The programme details are available on the Companys ( shareholder-information/policies/).

5. Particulars of contracts and Related party transactions

In line with the requirements of the Companies Act, 2013 and LODR, your Company has formulated a policy on Related Party Transactions. All related party transactions entered during the year were on an ‘arms length basis and were in the ‘ordinary course of business. There were no materially significant party transactions made with the Promoters, Directors or Key Managerial Personnel which may have a potential conflict of interest of the Company at large. The Policy of related party transactions can be accessed on the companys website (

All Related Party Transactions are placed before the Audit Committee for review and approval. Prior omnibus approval is obtained for Related Party Transactions on a quarterly basis for transactions which are of repetitive nature and/or entered in the ordinary course of business and are at arms length. All Related Party Transactions are subjected to independent review by a reputed accounting firm to establish compliance with the requirements of Related Party Transactions under the Companies Act, 2013 and LODR.

6. Directors responsibility statement

Your Directors confirm:

(i) that in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanations relating to material departures, if any;

(ii) that the Directors have selected such accounting policies and applied them consistently, and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as on 31 March 2021, and of the profit of the Company for the year ended on that date;

(iii) that the Directors had taken properandsufficient care for the maintenance of adequate accounting records in accordanceof their appointment by the Members with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company, and for preventing and detecting fraud and other irregularities; (iv) that the Directorsof the Members for the appointment have prepared the annual accounts on a going concern basis; of the members (v) that proper internal financial controls laid down by the Directors were followed by the Company and such internal financial controls are adequate and were operating effectively and

(vi) that proper systems to ensure compliance with the provisions of all applicable laws have been devised and such systems were adequate and were operating effectively.

7. Annual return

In line with the requirement of the Companies (Amendment) Act, 2017, effective from 31 July 2018, the extract of annual return, is no longer required to be part of the Boards Report. However, a copy of the Annual Return shall be placed on the Companys website ( shareholder-information/annual-return/ of remuneration). for

8. Corporate governance & Business sustainability report

Your Company is part of the GlaxoSmithKline plc group and conforms to norms of Corporate Governance adopted by them. As a listed Company, necessary measures are taken to comply with the Listing Obligations & Disclosures Regulations, 2015 (LODR) with the Stock Exchanges. A report on Corporate Governance, along with a certificate of compliance from the Auditors, given in Annexure ‘B, forms a part of this Report. Further, a Business Responsibility Report describing the initiatives taken by your Company from an Environmental, Social and Governance perspective are given in Annexure ‘C, which forms a part of this Annual Report.

9. Auditors

As per the provisions of section 139 of the Companies Act 2013, Deloitte Haskins and Sells LLP, Chartered Accountants were appointed as the Statutory Auditors of the Company for the period of five years at the 92nd Annual General Meeting held on 25 July 2017 to hold office from the conclusion of the said Meeting till the conclusion of the 97th Annual General Meeting to be held in 2022, on a remuneration to be determined by the Board of Directors. Their appointment was subject to ratification of the Company at every Annual General Meeting. Pursuant to the amendments made to section 139 of the Companies Act, 2013 by the Companies (Amendment) Act, 2017 effective from 7 May 2018, the requirement of seeking ratification of the Statutory Auditors has been withdrawn from the statute. In view of the above, ratification at Annual General Meeting is not being sought.

Pursuant to the provisions of section 204 of the Act, and the Rules made thereunder, the Company has appointed Parikh & Associates, Practicing Company Secretaries, to undertake Secretarial Audit of the Company. The Report of the Secretarial Auditor is annexed to the Board Report as Annexure D which forms a part of this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

Pursuant to Section 148 of the Companies Act, 2013, the Board of Directors, on the recommendation of the Audit Committee, have appointed R. Nanabhoy & Co., the Cost Accountants, for conducting the audit of the cost accounting records maintained by the Company for its Formulations for FY 2021-22. The Committee recommended ratification 2020-21 to the Shareholders of the Company at the ensuing Annual General Meeting.

10 Transfer of equity shares unpaid/Unclaimed dividend to the Investor Education Protection Fund (IEPF)

In line with the statutory requirements, the Company has transferred to the credit of the Investor Education and Protection Fund, set up by the Government of India, the equity shares in respect of which dividend had remained unpaid/ unclaimed for a period of seven consecutive years, within the timelines laid down by the Ministry of Corporate Affairs. Unpaid/unclaimed dividend for seven years or more has also been transferred to the IEPF pursuant to the requirements under the Act.

11 Compliance with secretarial standards

The Board of Directors affirms that the Company has complied with the applicable Secretarial Standards issued by the Institute of Companies Secretaries of India (SS1 and SS2) respectively, relating to Meetings of the Board and its Committees which have mandatory application.

12. General

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo, as stipulated in section 134(3) M of the Companies Act, 2013 and the rules framed thereunder, is attached herewith as Annexure E, which forms a part of this Report. The disclosures pertaining to the remuneration and other details, as required under section 197(12) of the Companies Act, 2013, and the rules made thereunder, are enclosed asAnnexure F, which forms a part of this Report. Pursuant to section 129(3) of the Companies Act, 2013, a statement in form "AOC-1", containing salient features of the Financial Statements of the Subsidiary Company, is attached.

Although the audited statements of accounts relating to the Companys Subsidiary are no longer required to be attached to the Companys Annual Report, the same is enclosed as and in way of better disclosure practice. The information relating to top ten employees in terms of remuneration and employees, who were in receipt of remuneration of not less than Rs. 1.02 cores during the year or Rs. 8.5 lakhs per month during any part of the year, forms part of this report and will be provided to any shareholder on a written request to the Company Secretary. In terms of Section 136 of the Act, the said report will be available for inspection of the shareholders through electronic mode. The shareholders may write an email by mentioning "Request for Inspection" in the subject of the email.

13. Acknowledgments

The Directors express their appreciation for the contribution made by the employees for remarkable agility and resilience throughout the year in unprecedented circumstances including significant improvement in the operations of the Company and also for the support received from all other stakeholders, including Shareholders, doctors, medical professionals, customers, suppliers, business partners and the government.

The Board and the Management of your Company appreciative of the support being received from GSK plc.

On behalf of the Board of Directors

Ms. R. S. Karnad


Mumbai, 18 May 2021