Panacea Biotec Ltd Management Discussions

GLOBAL VACCINE MARKET

The global vaccine industry continues to attract signi cant attention from governments, multilateral agencies, large scale donors and investors all across the globe. Vaccine immunization programs that are run across various countries have saved millions of lives every year. Covid-19 pandemic has given further impetus to the importance of vaccines as a lifesaving tool resulting into a strong push to the vaccine industry. With increased awareness, resounding success of current vaccination programs, and successful model developed by Gavi, the Vaccine Alliance (Gavi) for adoption and funding, the number of vaccines being targeted are increasing as per the World Health Organisation (WHO) Immunization Agenda 2030 (Ia2030), Gavi 6.0 and Gavis Vaccine Innovation Prioritisation Strategy (VIPS).

As per industry estimates, the global vaccine market declined from US$144 billion (including Covid-19 vaccine sales) to about US$ 124 billion in 2022, however the other vaccines (other than Covid-19 vaccine) market grew from US$ 43 billion in 2021 to US$ 46 billion in 2022 and is estimated to be at US$ 48 billion in 2023. It is estimated to grow at a rate of ~4.4% annually until 2030. Excluding the Covid-19 vaccine portion of the market, global vaccine market has continued to grow over the past four years, driven partly by increasing use of high-priced adult vaccines (pneumococcal conjugate vaccine and shingles) as well as significant value growth in China driven primarily by private market demand for human papilloma virus vaccine.

Concentration of vaccine manufacturing remains with 10 manufacturers alone providing 75% of vaccine doses (excluding Covid-19 vaccines) and capturing 85% of the global value of vaccines, with more than 80 manufacturers serving the remaining market.

Future growth in the global vaccine market is expected to be driven by increased availability of a fordable vaccines, growing awareness on immunization and vaccination benets in emerging markets supported by government led immunization programs. WHO continues to take initiatives to increase awareness of immunization through Global Vaccine Action Plan (GVAP) and Global Immunization Vision and Strategy (GIVS). Growth in the Asia-Pacic markets is driven by large population base, rising prevalence of infectious diseases, increasing vaccination awareness & acceptance and high expenditure by governments.

Dynamics of Global Vaccine Market

· Driver: Increasing focus on immunization programs: The focus on immunization has increased considerably with rising healthcare awareness and several government organizations are undertaking initiatives to meet this goal.

National Governments fund National Immunization Programmes (NIP) through public market tenders or procurement through UN Agencies like United Nations Childrens Fund (UNICEF), Pan American Health Organization (PAHO), etc. There are vaccines for over 16 diseases, including measles, diphtheria and whooping cough (pertussis) as well as the more recently developed vaccines, such as the human papilloma virus (HPV) and meningococcal quadrivalent (ACWY) vaccines that are covered by NIPs. Gavi and other donor agencies are routinely providing support including technical expertise and funds to national Governments to adopt new vaccines.

Over 100 million children born in the Rest of the World (ROW) countries receive vaccines through UN Agencies or through their national Governments. These purchases have ramped up the growth in the vaccine market since early 2000, wherein Gavi has helped adopt more than 16 vaccines in global immunisation programs through market and non-market activities including providing funding to di erent manufacturers for development of vaccines.

Restraints: Low purchasing power in developing countries: The traditional six vaccines under the Expanded Programme on Immunization (EPI), viz. measles, diphtheria, pertussis, tetanus, oral polio, and bacille calmette-guerin (BCG vaccine for tuberculosis disease) are mature products and o ered as combination vaccines. High x ed costs and a steep learning curve make new vaccines relatively expensive, as the investments in R&D and production facilities need to be recovered and production techniques need to be optimized and perfected to bring down variable production costs. New vaccines that involve recombinant DNA (rDNA) or messenger RNA (mRNA) technology are newer age technologies that have been proven during the Covid-19 pandemic and pose new threats to replace traditional vaccines. However, cost considerations, ease of use and high acceptance rates of traditional vaccines will continue to remain barriers in adoption of newer vaccine technologies that are expensive, unsuitable for traditional refrigerators, and more carbon intensive (due to requirement of specialized chemicals and raw materials, transportation challenges, lyophilization, specialized refrigerators, etc.).

Non-market activities undertaken by international organisations without competitive process may discourage private investments in development of vaccines as it creates unreal pricing pressures for manufacturers trying to enter the market without such extramural funding (like grants, etc.), creating barriers to entry, and uncertainty regarding commercial viability. These market and non-market factors together continue to threaten the business case of developing novel vaccines that are or could potentially be included in the priority pathogen list.

Opportunities:

Growing Global Demand: Increased awareness of the importance of vaccination can expand market opportunities.

Technological Advancements: Innovations like mRNA technology can lead to the development of more e ective vaccines.

Focus on newer technologies, therapeutic vaccines and pandemic preparedness: Therapeutic vaccines enable corrective treatment, as opposed to preventive vaccines. An improved understanding of immunology has resulted in the opportunity to develop therapeutic vaccines for the treatment of cancer, allergies, physiological disorders and infectious diseases. Such diseases have a large patient base that desperately seeks alternative safer treatments. Scientists have attempted to develop novel therapeutic vaccines against hypertension, dyslipidaemia, alzheimers disease, cancer and inoammatory diseases by targeting self-antigens. If the e cacy and safety of vaccines can achieve an e ect equivalent to that of medication, vaccines may be an alternative to daily medication for the treatment of lifestyle diseases.

Partnerships and Collaborations: Collaborating with Governments, NGOs, and other pharma companies to enhance reach and resources.

Public Health Initiatives: Leveraging global health campaigns to promote vaccination programs.

Market generation activities undertaken by international organisations continue to increase the number of vaccines being covered by the National Immunization Programs and the number of countries are rolling out the WHOs recommended schedule for vaccination either through self-funded or donor funded programs. Vaccines targeting priority pathogens continue to provide large-scale opportunities for expansion as each such vaccine can immediately reach to more than 100 million babies born every year. As of June 2024, Gavi supports vaccine against 20 infectious diseases through 53 product presentations.

Such e orts by agencies like Gavi will continue to benet Panacea Biotecs pipeline candidates. Under Gavi 4.0, Gavi Boards "in principle" support decision in 2018 was a strong signal that incentivised multiple manufacturers to pursue their hexavalent vaccine development plans which will help create a healthier and more competitive market in the medium and long term. Additional engagement by Alliance partners has improved several market attributes to ensure a successful launch of hexavalent vaccine, especially at a price that was optimized in the latest UNICEF tender owing to a cross-alliance e ort. As part of the Gavis Vaccine Investment Strategy (VIS 2018), the wP-hexavalent vaccine (orst launched by Panacea Biotec in March 2017 under the brand name, EasySixR) was prioritized. In June 2023, Gavi conormed the adoption of the wP-hexavalent vaccine creating a market for over 100 million doses annually by 2030 in Gavi countries.

Stockouts of existing vaccines: The market continued to witness more than 80 stockouts of essential vaccines across the year in 2022. These were majorly due to procurement, funding, shortage or quality issues. Such shortages continue to incentivize manufacturers to maintain high levels of inventory of vaccines and raw materials to cater to such stockouts to ensure that paediatric immunization programs are not impacted anywhere. Due to Covid-19 related delays, more than 100 million doses of Pentavalent vaccines are now required in 2024 and 2025 to onish catchup immunization programs. Gavi has decided to fully fund these catchup immunizations but with exit of a manufacturer from the market, remaining existing manufacturers are going to be under pressure to meet the tight timelines for vaccine supply.

Opportunities in the Indian vaccine market:

The Government of India is the single largest buyer of vaccines with procurement being undertaken for ~27 million babies annually.

Higher local content requirements in Indian tenders continue to o er opportunities for Indian manufacturers to develop and commercialise EPI vaccines for the high-volume but low-value Indian market.

Gavi 5.0 / 6.0s push for inclusion of more vaccines in the global EPI schedules and Government of Indias new commitments to reduce infant mortality and boost maternal health will continue to provide more opportunities for sustainable market development leveraging existing vaccine platforms.

With Gavi 5.0 (2021-2025), there is renewed interest in the public market adoption of dengue vaccine. The Alliances proposal to encourage large-scale immunization programs will create a sustainable market for such vaccines beyond India. Panacea Biotec has recently initiated Phase III clinical trials of its candidate tetravalent dengue vaccine, DengiAllR in India in collaboration with ICMR.

Challenges:

Vaccine misinformation: Misconception about vaccines often arises when there are information gaps or unsettled science, as human nature seeks to reason, better understand, and oll in the gaps. Vaccine misconceptions and misinformation are major concern among governments, funding agencies, vaccine manufacturers and suppliers, and other stakeholders alike. Low acceptance rates due to vaccine misinformation result in the lower market penetration of e ective and safe vaccines, which could adversely a ect the market.

Regulatory hurdles: Stringent and varying regulations across countries can delay market entry.

Competition: Increasing competition from other pharmaceutical companies developing similar vaccines.

Supply Chain disruptions: Natural disasters, pandemics or geopolitical issues can disrupt the supply chain.

Adverse events and Safety concerns: Reports of adverse events can lead to loss of trust and legal liabilities.

Intellectual Property disputes: Legal challenges over patents and proprietary technologies.

INDIAN VACCINE MARKET

The Indian vaccine industry has seen a significant increase in demand for vaccines, especially after the sudden outbreak of Covid-19. The Governments continued e orts and awareness programs to promote the usage of vaccines has resulted in the public becoming more aware, comfortable and familiar with vaccinations. All this is expected to add to the market growth in the future years.

The rising number of private companies in India has also aided in the growth of the market share. Many pharmaceutical and biotechnology forms have made e orts to o er low-cost vaccine solutions and are gradually turning their attention to innovation to elevate their revenues. The Government is also fostering market expansion by easing the rules and regulations and inviting foreign investments in order to accelerate the establishment of a better medical research infrastructure.

India continues to be one of the largest vaccines producing countries and a global leader in the supply of diphtheria, tetanus and pertussis (DPT) and DPT based combination vaccines, bacillus calmette guerin (BCG) and Measles vaccines. Being one of the biggest suppliers of a ordable vaccines in the world, India accounts for ~60% of global vaccine production, contributing ~40 to 70% of the WHO demand for DPT and BCG vaccines, and ~90% of the WHO demand for the Measles vaccine. Universal Immunization Programme (UIP) run by the Government of India is one of the largest public health programmes in the world, covering ~30 million pregnant women and ~27 million newborn babies annually. Under UIP, the Government of India is providing free of cost vaccination against 12 vaccine preventable diseases.

The Indian vaccine market is estimated at ~ 290 billion (~US$ 3.5 billion) in 2023. The market is further expected to reach ~ 996 billion (~US$ 12 billion) by 2030, growing at a compound annual growth rate (CAGR) of ~10-12% in the near future. The future growth in the Indian vaccine industry will be driven by several factors like Government initiatives, population growth, advancements in vaccine technology, government led immunization programs, investment support in research & development (R&D) by government funding agencies, increased awareness & access and income levels allowing people to vaccinate their families against deadly diseases. In addition, technological advancements, higher manufacturing capacities and cold chain storage facilities are also expected to support the future growth of the Indian Vaccine Industry.

India is among the top 12 destinations for biotechnology worldwide and third largest in Asia-Pacic . The country holds 3-5% of the global biotechnology industry pie. In 2022, Indias bioeconomy was valued at US$ 137 billion, and aims to achieve US$ 300 billion mark by 2030.

Panacea Biotec is committed towards growth of the Indian private market vaccine franchise with additional launches scheduled in the next 18 to 24 months and hopes to introduce NucoVacR11 and DengiAllR among other products to meet unmet medical needs in 2026, subject to successful completion of the Phase III clinical trials and receipt of requisite regulatory approvals. EasySixR (the worlds rst fully liquid wP-based Hexavalent vaccine) continues to be the market leader.

GLOBAL PHARMACEUTICAL MARKET

The global pharmaceutical market is estimated at ~US$ 1,560 billion in 2023 and is expected to grow to ~US$ 2,833 billion by 2033 growing at a CAGR of 6.15% during 2024 to 2033. North America dominates the global market with ~38% market share followed by Europe ~30% and Asia-Pacioc region ~25%.

The expansion can be ascribed to an upswing in healthcare awareness, a heightened prevalence of respiratory diseases, shift in lifestyles, surge in pharmaceutical research and development (R&D) expenditure, a growing aging population, rise in the number of surgical procedures, robust economic growth in emerging markets and increased number of approvals for haematology / oncology (cancer) drugs.

The future growth will mainly be driven by critical therapeutic areas like oncology, immunology, cardiology and neurology which are the fastest-growing therapeutic areas at present and will continue in future. An ageing population in many developed markets will also create higher demand for medicines. In particular, demand for chronic disease medicines will grow in the mid and long-term. Pharmaceuticals demand in emerging markets is set to increase due to growing government support, increase in healthcare access, rise in investments, rapid growth in the elderly population, upsurge in healthcare expenditure and heightened awareness of immunization and vaccination.

INDIAN PHARMACEUTICAL MARKET

India continues to be the 3 largest worldwide for

pharmaceutical production in terms of volume and 14 in terms of value. During nancial year 2017-18 to 2022-23, the Indian pharmaceutical industry grew at a CAGR of 6-8%, primarily driven by an 8% increase in exports and a 6% rise in the domestic market. According to Government data, the Indian pharmaceutical industry is worth ~US$ 50 billion with exports contributing ~US$ 27 billion. The country has ~20% share in the global supply volume and contributes to ~60% of the global vaccines. Key segments of the Indian Pharmaceutical industry are OTC medicines, generics, active pharmaceutical ingredients (APIs), vaccines, biosimilar and contract research manufacturing (CRM). The pharmaceutical exports from India reach more than 200 nations around the world, including highly regulated markets of the USA, Europe, Japan and Australia.

The country has an established domestic pharmaceutical industry, with a strong network of ~3,000 pharmaceutical companies and ~10,500 manufacturing units. The pharma sector currently contributes to ~1.8% of the countrys GDP. The production linked incentive (PLI) scheme for pharmaceuticals is being implemented by the Government of India with a total outlay of ~US$ 2.04 billion ( 15,000 Crore) spanning from 2020-21 to 2028-29, to boost Indias manufacturing capacity, elevate investment, and diversify product o erings in the sector. Pharmaceutical industry in India is expected to reach ~US$ 65 billion by 2024 and to ~US$ 130 billion by 2030. India supplies over 50% of Africas requirement for generics, ~40% of generic demand in the US and ~25% of all medicines in the UK.

Nutrition Market

The baby food and infant formula market is estimated to be ~US$ 5.7 billion in 2023 (~ 475 billion) in India. As per industry estimates, this market is expected to grow to ~US$ 9.0 billion (~ 751 billion) by 2032, growing at a CAGR of 5% during 2024-2032. The growth in this market will be driven by increasing awareness among the parents for overall development of children through nutritional products. Consumers are increasingly using baby food products to give additional supplements to increase the immunity and health of infants and young children. The future growth will also be driven by other innovative products including ready-to-feed baby food products, that are easy to use, portable and rich in nutritional values.

PANACEA BIOTECS BUSINESS AND STRATEGY

Panacea Biotec group continues to focus on its vaccines and pharmaceutical business including the recently launched nutrition products. Vaccines business contributes the largest share in the groups revenues with the remaining coming from pharmaceutical formulations and nutrition products.

We believe that we have a strong pipeline and are well positioned for future growth. Research & Development is at the heart of fulolling our purpose to deliver a ordable innovations that enable people to live well and live longer. Our R&D e orts seek to add value to our existing products by improving their e ectiveness, ease of dosing and reducing cost of manufacturing. We seek to leverage a strong pipeline, organize around expected operational growth drivers and capitalize on trends creating long-term growth opportunities.

We are committed to strategically capitalizing on growth opportunities, primarily by advancing our own product pipeline and maximizing the value of our existing products, but also through various business development activities. We view our business development activity as an enabler of our strategies and seek to generate growth by pursuing opportunities and transactions that have the potential to strengthen our business and our capabilities. We assess our business, assets and scientic capabilities / portfolio as part of our regular, ongoing portfolio review process and also continue to consider business development activities that will help advance our business strategy.

VACCINES BUSINESS

Panacea Biotec is one of the leading manufacturers of paediatric vaccines and has played a pivotal role in eradication of Poliomyelitis from India and many other countries. Panacea Biotec had been one of the largest suppliers of oral polio vaccines to UNICEF, the Government of India and other developing countries. In last over two decades, the Company has supplied more than 10 billion doses of polio vaccine in India and developing countries and enabled more than 190 million immunizations by supplying fully liquid wP based combination vaccines. Our innovations have helped increase paediatric immunization coverage, provided signiocant savings in the overall cost of immunization and saved the lives of millions of children in developing countries.

We believe that the following are the key strengths of Panacea

Biotec:

Advanced Research and Development Capabilities: Strong R&D teams and state-of-the-art laboratories enable the development of innovative vaccines.

Strong Regulatory Knowledge: Expertise in navigating complex regulatory environments to secure approvals.

Robust Supply Chain: Efficient manufacturing and distribution networks ensure timely delivery of vaccines.

Established Brand and Reputation: Trusted by healthcare providers and the public, leading to higher acceptance rates.

Intellectual Property: Patents and proprietary technologies provide a competitive edge.

The Company has pioneered in the development of vaccines ranging from recombinant, polysaccharide conjugate and viral vaccines. The Company has a strong pipeline of vaccines under development to boost its future growth including DengiAllR a single dose live-attenuated tetravalent vaccine against Dengue fever, NucoVacR11 a pneumococcal polysaccharide conjugate vaccine (11-valent), Hepatitis A vaccine and a multi-epitope nanoparticle based broadly protective Betacoronavirus candidate vaccine.

The Company has, in collaboration with Indian Council of Medical Research (ICMR), recently initiated a Phase III clinical trial for Indias rst dengue vaccine DengiAllR to be conducted at19 trial sites covering ~10,335 subjects across India.

Our paediatric vaccine franchise largely focuses on providing newborns protection against deadly diseases like Diphtheria, Tetanus Toxoid, B. Pertussis, Hepatitis B, Hib Type b, and Polio.

We have a strong legacy as a global vaccine player with a track

record to bring rst-t o-market innovative vaccines like:

Worlds rst fully liquid wP -IPV based hexavalent vaccine, EasySixR (DTwP-HepB-Hib-IPV)

Worlds rst fully liquid wP-IPV based pentavalent vaccine, EasyFourPolR (DTwP-Hib-IPV)

Worlds rst fully liquid wP based pentavalent vaccine, Easyv e-TTR (DTwP-HepB-Hib)

Worlds rst mono valent oral polio vaccines (mOPVs) and bivalent oral polio vaccine (bOPV with Poliovirus Type 1 and Type 3), Bi-OPVR.

During the onancial year 2023-24, total consolidated revenues from vaccines business increased to 3,595.90 million from 2,569.87 million in the previous nancial year, registering a growth of ~40%. The revenue from export of vaccines also increased by ~50% to 3,158.21 million as against 2,102.25 million during previous year. During the year, the Company has launched the EasyFourPolR vaccine in Indian private markets. The Company has also started generating royalty income from Serum Institute of India Pvt. Ltd. against sale of hexavalent vaccine developed by it under the collaboration agreement signed earlier with the Company.

The existing commercialized product portfolio of the Company includes key proprietary vaccines, hexavalent vaccine EasySixR, fully liquid pentavalent vaccine, EasyFourPolR, fully liquid tetravalent vaccine, Easyfour-TTR and WHO pre-qualioed fully liquid pentavalent vaccine Easyv e-TTR and bivalent poliomyelitis vaccine Bi-OPVR.

About Easy ve-TTR

Easyove-TTR is the worlds orst fully liquid wP-based Pentavalent vaccine that was launched in India in 2005. After receiving WHO pre-qualiocation in 2008, more than 190 million doses have been supplied to over 75 countries globally. It is a ready-to-use combination vaccine that does not require preparation by healthcare workers at the clinic, reduces the number of visits to vaccination centres, and reduces the overall cost of immunization for all the stakeholders.

About EasySixR and EasyFourPolR

Panacea Biotec is the innovator and intellectual property rights holder of EasySixR, the worlds rst wP based fully liquid hexavalent vaccine. The WHOs Strategic Advisory Group of Experts on Immunization (SAGE) has supported the global rollout of wP-IPV based hexavalent vaccine in the global immunization schedule creating an opportunity for more than 250 million doses of hexavalent vaccine annually. Panacea Biotec is in the process of expanding its manufacturing capacities at Lalru, Punjab for manufacturing of vaccine drug substance in order to meet the growing demand of vaccines in future by public health agencies.

In India, the Company has a eld force of around 150 persons spread across the country to regularly reach out to nearly 10,000 paediatricians across India. Over 400,000 children are vaccinated in the private market in India. EasySixR is the brand leader in India in wP-IPV based hexavalent vaccine market with the largest market share in its segment (IQVIA March 2024). The wP-IPV based hexavalent vaccines also competes with aP-IPV based vaccines in the private market in India.

During the year, Panacea Biotec also launched the worlds rst fully liquid wP-IPV based Pentavalent vaccine under the brand name of EasyFourPolR. It provides protection against Diphtheria, Tetanus Toxoid, B. Pertussis, Hib Type b and Polio. It is the only vaccine in its segment of wP-IPV based vaccine and aids healthcare practitioners who prefer to give Hepatitis B as a standalone vaccine or in mixed schedules due to high-risk births.

Our combination vaccines led by EasySixR and EasyFourPolR also set the precedent of promoting environmental sustainability. Adoption of EasySixR in the immunization program is expected to lead to reduction of over 60% carbon emissions, helps make a single immunisation program (3 vs. 1), over 50% reduction in supply chain costs and storage beneots, and also more than 50% reduction in biological waste.

Apart from lower number of injections and less pain for children, EasySixR provides additional benets to parents and governments. As parents can get all the vaccinations completed in fewer visits, they are more likely to get their children vaccinated. With higher vaccination rates, governments shall have to spend less money to create healthcare infrastructure and doctors / nurses shall spend less time on treating avoidable diseases among children; families also get benet ed as they truly spend their income to improve their quality of life. Hence, overall society benets from critical combination vaccines like EasySixR.

Considering the benets that EasySixR o ers, WHO SAGE in October 2021 approved adoption of hexavalent vaccine in the global immunization program. This led to PAHOs adoption in May 2023 and Gavis adoption in June 2023. Further, UNICEF has already updated its forecast for hexavalent vaccines as stated below:

UNICEF forecast	2024	2025	2026	2027	2028	2029	2030	Total
Gavi-73	3	19	44	71	97	105	107	446
Gavi-64	3	19	41	60	83	90	90	385

Giving further impetus to hexavalent vaccine adoption, Gavi has also given its preference to introduce a fourth dose for every child in the second year of life - this will replace the ongoing commitment for adoption of a DTP based booster in the second year of life.

Pipeline vaccines

The Phase III clinical trial for Td (Tetanus and Diphtheria reduced) vaccine - TedShotR has been completed and licensure for India will be completed in due course. The vaccine is planned to be launched during current financial year. We expect it to compete in the annual 250 million private market in India.

The Phase III clinical trial for DengiAllR has recently been initiated in collaboration with ICMR and Phase II / III clinical trial for NucoVacR11 vaccines is expected to commence in India during the current calendar year.

Global business for Vaccines

Panacea Biotec has been one of the largest suppliers of vaccines to multilateral agencies like UNICEF, PAHO, etc. and has been supplying vaccines to institutional customers and national Governments for over two decades. The Companys vaccines are exported to ~50 countries in Africa, Asia and Latin America. Besides supplying Easyv e-TTR and Bi-OPVR, the Company will also be seeking WHO pre-qualication of its pipeline products for supply to UN agencies and other national Governments. As a part of the Companys strategy to enter into the international private vaccine market, the Company has already registered its vaccines in 13 countries. The product registration in 18 countries (including African Medicines Regulatory Harmonization (AMRH) which will inter-alia enable launch of product in~29 countries in African region who have ratied the African Medicines Agreement (AMA)) is in progress and is expected to be approved in due course.

Panacea Biotec is supporting global cause of providing aordable vaccines to the children across the globe and it works closely with global organizations like WHO, Gavi,

UNICEF, PAHO, CEPI, Gates Foundation and Clinton Health Access Initiative (CHAI), etc. The Company is a member of Developing Countries Vaccine Manufacturers Network (DCVMN), a public health driven international alliance of manufacturers and shares common vision and mission of combating infectious diseases and accelerating access to a fordable high-quality vaccines.

PHARMACEUTICAL FORMULATIONS AND NUTRITION

BUSINESS

Panacea Biotec through its wholly owned subsidiary Panacea Biotec Pharma Limited ("PBPL" or "Panacea Biotec Pharma") has an established business of pharmaceutical formulations in India and exports its pharmaceutical products to ~36 countries worldwide including the United States, Canada, Germany, UAE, Saudi Arabia, Jordan, Qatar, Turkey, Russian Federation, Kazakhstan, Uzbekistan, Serbia, Tanzania, Kenya, Uganda, Vietnam, Philippines, Thailand, Sri Lanka, Brazil, Panama, Ecuador, Paraguay, Trinidad & Tobago, etc. Another indirect wholly owned subsidiary Panacea Biotec Germany GmbH, Germany is also engaged in sales of pharmaceutical products in Germany.

During nancial year 2023-24, PBPL also entered into nutrition

market with launch of ChilRunR range of products.

During the year, total consolidated revenues from pharmaceuticals and nutrition business was 1,995.78 million as against 2,029.59 million during previous nancial year. The exports contributed revenues of 1,655.79 million as against 1,387.77 million during previous onancial year, registering a growth of 19%. The domestic revenues declined to 339.99 million as against 641.82 million during previous nancial year mainly due to decline in revenue from contract manufacturing.

During the year under review, PBPL has launched the nanotechnology-based generic product, Paclitaxel protein bound in human albumin particles, in Canada during the nancial year 2023-24. PBPL received approval for its product Valgapan (valganciclovir powder for oral suspension) in Germany. The product is planned for launch through PBGG during the current year. PBPL exports its products to more than 30 countries worldwide including the countries in Europe, Asia, Africa and LATAM.

The international pharmaceutical formulation product portfolio includes prescription products in niche therapeutic areas such as transplantation, renal disease, oncology, respiratory, pain management, diabetes and gastro-intestinal care. PBPL has continued its focus on development, registration and marketing of products portfolio catering to chronic therapies in private markets in several countries.

PBPL is continuously ling new product registration dossiers in existing as well as new markets to further strengthen and grow its exports in the future. The Abbreviated New Drug Applications (ANDA) submitted under section 505 (j) of the Federal Food, Drug & Cosmetics Act are in process of approval by the U.S. Food and Drug Administration ("USFDA"). PBPL plans to launch these products in US, Europe, etc. through strategic collaborations with leading pharma companies. It has key partnerships with global pharmaceutical companies for marketing of pharmaceutical formulations in USA, Canada and other international markets, which has helped in expanding its reach and access to new regulated markets.

PBPL has taken more initiative on brand building & customer connect through various mass promotion programs through online media, in-clinic discussions through digital mobile platform, scientioc education initiatives (CMEs), product specioc medical trainings, country specioc strategies & scientic promotions and medical training programs.

PBPL continuously takes steps to strengthen and grow its exports in the coming years including building a strong portfolio, strengthening marketing team, entering into newer markets, identifying strong distributor and marketing partners in newer regions and registering products in more countries as well as strengthening existing relationships with the partners. It is developing a portfolio of products for European markets, GCC countries and other emerging markets.

NUTRITION BUSINESS

Panacea Biotec Pharma has entered into a new business of research, development, manufacturing and marketing of nutrition products. It has developed its own product portfolio for the nutrition segment at its Sampann R&D Center and has set-up a manufacturing facility to manufacture these products at Baddi, Himachal Pradesh.

To start with, in June 2023, PBPL launched paediatric nutrition

products under the brand name, ChilRunfullR, ChilRunR7+,

ChilRunRNo Sucrose in ~150 territories across India covering almost 15,000 paediatricians presently. The products are also available online on e-commerce platforms as well like Amazon, Tata 1mg etc. It plans to add more products going forward to expand the product portfolio and markets including other specialties like gynaecology and adult nutrition.

As part of the initial launch and subsequent activities, PBPL has undertaken several sales and marketing initiatives to create awareness about the ChilRunR brand portfolio across the country including organizing taste campaigns, Fizz zone camps, Shakti camps and also conducting observation study to assess the impact of its products on the babys growth. More such activities are planned during the current nancial year to ensure that the momentum continues among the consumers.

Supply Chain Management

Panacea Biotec is committed to ensure the timely availability of its products to its business partners and patients. It has an established Supply Chain Management (SCM) system designed for creating end-to-end visibility and controls right from sourcing of materials till collection of receivables for the vaccines, pharmaceuticals and nutrition products.

The Group has a strong logistics network comprising of 2 Central Warehouses and 23 Sales Depots / Carrying & Forwarding Agents (CFAs) (comprising of vaccine and nutrition business). Vaccine and nutrition products availability across India is ensured through vast distribution network of ~1,000 distributors as on March 31, 2024, which enable us to have a Pan India presence and access to a wide market base. A separate trade team has been set-up for regular coordination with stockiests to address supply challenges, if any. The Company continues to increase its customer base by adding more stockiests and plans to add more stockiests to further increase the reach to the customers.

The Company has collaborated with and appointed world class logistics providers, clearing agents and airlines with a proven record of timely delivery of goods in export markets in Asia, Europe, Africa, North & South America.

The Company has got expertise in cold chain management for storage and distribution of vaccines under controlled conditions using a system of Vaccine Vial Monitors (VVMs), data loggers, ice boxes, coolant, cold rooms, refrigerated vehicles and Tyvek sheet for sending temperature controlled products overseas and across India directly from its Vaccine Formulation Facility at Baddi, Himachal Pradesh. This ensures that the Vaccines remain safe and e ective against changes in the variant temperature conditions during transit.

Panacea Biotec has a well-established Track and Trace system and documentation quality to ensure timely delivery of goods at the destination and avoid demurrage and detention charges. Panacea Biotec has also optimized raw material, packaging material, onished good inventory to achieve maximum inventory turn and to minimize expiry.

MANUFACTURING FACILITIES

Vaccines Formulation Facility at Baddi

The Companys state-of-the-art manufacturing facilities for vaccine drug substances and drug products, comply with the cGMP practices of the key International regulatory bodies like WHO cGMP standards.

The Vaccine Formulation Facility at Baddi, Himachal Pradesh, which started its operations in the year 2008, comprises of two blocks. The production block is spread over approx. 2,800 M2 constructed areas at each oor . The warehouse cum cold storage block measures approx. 3 x 2500 M2. The facility has 2 independent formulation suites and 3 olling lines for manufacturing of bacterial, viral and recombinant vaccines including live attenuated vaccines in pre-lled syringe (PFS) and in single dose and multi-dose vial presentations. The facility also has large lyophilization capacity for manufacturing lyophilized vaccines in vials. This facility is approved by Indian National Regulatory Authority (NRA) and is also pre-qualied by WHO for the pentavalent vaccine Easyv e-TTR and Bi-OPVR. There is an additional vial lling line for manufacture of live, attenuated vaccines including oral polio, measles, dengue vaccines, Covid-19 vaccine, etc. The Quality control laboratories of the facility are equipped with an assortment of sophisticated analytical equipment for testing of vaccines and input materials to assure quality of the product at each stage of manufacturing. The warehouse facility is equipped with cold storage and deep freezers for cold chain maintenance and dispatch management of vaccines.

During the year under review, the Companys vaccine facilities at Lalru and Baddi were inspected by WHO in relation to pentavalent vaccine Easyv e-TTR and Bi-OPVR. The inspection was completed without any critical observation and successfully closed with the WHOs acceptance of the corrective and preventive action (CAPA) plan submitted by the Company.

Vaccine Drug Substance & Biosimilar facilities at Lalru

The Company has vaccine drug substance manufacturing facilities at Lalru, Punjab which started operations in the year 2002 with separate blocks for manufacture of recombinant, bacterial and viral vaccine drug substances. An integrated block for vaccines drug substance and bio pharmaceuticals is also established which comprises of 3 independent suites dedicated for manufacture of drug substance for: a) Bacterial vaccines, b) Viral vaccines, and c) Recombinant vaccines

Recombinant hepatitis B surface antigen, Haemophilus inouenza type b conjugate (Hib-TT), diphtheria, tetanus toxoids and inactivated whole cell pertussis drug substances are manufactured at these facilities. The drug substances for tetravalent dengue vaccine, DengiAllR and pneumococcal conjugate vaccine, NucoVacR11 are also manufactured in these facilities. The facility is also approved by WHO for producing bulk antigen of hepatitis B and Hib used for the manufacture of WHO pre-qualioed pentavalent vaccine Easyv e-TTR.

The Company is undertaking expansion of its vaccine drug substance manufacturing capacities to be able to meet the future growing demand of its vaccines by UN agencies and national Governments in various countries. The expansion project is expected to be completed during current nancial year after which the Company will undertake manufacturing of validation batches at new facilities and seek the approval of expanded facilities from the Indian NRA and WHO.

Pharmaceutical Formulations Facility at Baddi

Panacea Biotec Pharmas state-of-the-art pharmaceutical formulations facility at Baddi, Himachal Pradesh became operational in year 2006. The facility is equipped for bilayer tablets, complex sustained release coatings and delayed release coatings. The facility has received several certications and accreditations from international regulatory authorities including USFDA, The National Institute of Pharmacy and Nutrition (OGYEI) Hungary (EU), Federal Service for Surveillance in Healthcare (Russian Federation), Ministry of Health Ukraine, National Agency for Drug and Food Control, (Indonesia), Turkish Medicine and Medical Devices Agency, National Health Surveillance Agency (ANVISA), Brazil, South

African Health Products Regulatory Authority (SAHPRA) etc.

Quality is a core guiding factor behind Panacea Biotecs decisions and actions. Panacea Biotec Pharma maintains a harmonized Pharmaceutical Quality System (PQS) that caters to all markets. Some of its pharmaceutical formulation products are routinely supplied to low-income countries under access programs through international agencies such as PAHO.

>Panacea Biotec Pharma has dedicated and independent Quality Control facilities in the manufacturing facilities comprising of sample preparation with isolator containment, wet lab, lab for atomic absorption spectroscopy, dissolution testing and stability testing as per ICH Guidelines, a packaging-material testing laboratory and a fully self-contained microbiology lab to carry out tests for microbial counts, microbiological assays and assessing environment controls.

Panacea Biotec Pharmas pharmaceutical manufacturing expertise lies in various oral-solids, semi-solids and liquid oral dosage forms such as:

u Oral-solids - conventional tablets / capsules, controlled / delayed release / enteric coated tablets and capsules,

tablet in tablet, tablet in capsule, multi layered capsules, hard gelatin / soft gelatin capsules, mouth dissolving / chewable tablets, beads encapsulation, coating (olm, sugar, and functional), taste masking and fast-dissolving tablets;

u Semi-solids - ointments / creams / gels, transdermal drug delivery system; and

u Liquids - suspensions / syrups / solutions.

Cytotoxic / Oncology Facility at Baddi

Panacea Biotec Pharmas cytotoxic injectable formulation facility at Baddi, Himachal Pradesh, has dedicated lling lines for liquid & lyophilized injectables as well as pilot scale up batches complying with USFDA, EU and ROW cGMP norms.

Cytotoxic facility is equipped for manufacturing conventional and technology-based injections e.g. nano-particle and liposomal lyophilized products. This facility has been approved by Indian NRA, USFDA, The National Institute of Pharmacy and Nutrition (OGYEI) Hungary (EU) and other regulatory agencies.

Panacea Biotec Pharmas above facilities continues to be under the warning letter issued by the USFDA. It has undertaken several corrective and preventive measures to comply with the observations raised by USFDA. Panacea Biotec Pharma has also engaged international consultants as part of its corrective and preventive action plan to ensure that the manufacturing facilities meet the required standards. It is regularly undertaking further corrective and preventive actions as per the commitments made to USFDA. Nevertheless, the supplies of existing products to US market is continuing and there is no material adverse impact on current business from the facility.

Health Supplement Manufacturing Facility at Baddi

Panacea Biotec Pharma has set up a manufacturing facility to manufacture nutrition products at Baddi, Himachal Pradesh which became operational in April 2023. This manufacturing facility currently has installed capacity of ~6 tons per day.

Panacea Biotec Pharmas paediatric nutrition products under the brand name, ChilRunFullR, ChilRunR7+, ChilRunRNo Sucrose, are being manufactured at this facility.

The facility holds valid accreditations and certications from FSSAI (Food Safety and Standards Authority of India), A+ rating in external FSSAI Schedule IV Audit and is audited by the external third parties and found compliant to the GMP Codex Standard. Panacea Biotec Pharma also plans to set up facilities for new dosage forms of nutrition products in future.

RESEARCH & DEVELOPMENT

Panacea Biotec is a progressive & innovative biotechnology company with high focus on research & development, manufacturing and marketing operations across pharmaceuticals, vaccines, nutrition and natural or herbal products. The Company is guided by its vision of "Innovation in Support of Life" and strongly believes that innovation is important to the long-term success of the Company. Panacea Biotec specializes in complex generics, vaccines, and novel drug delivery platforms to o er higher value and better health outcomes for the patients, governments and overall society.

Panacea Biotecs research and development e orts have been its greatest strength. Its ambitions are backed by distinguished, ultra-modern, state-of-the-art R&D Centers with around 73 scientists with deep roots within the academic community in important clusters in India, USA and Germany among other countries.

One-Stream R&D Center at New Delhi

Panacea Biotecs One-Stream Research and Development (R&D) Centre ("ORC") is a state-of-art facility to cater to all the modern aspects of vaccine development. This Centre has the capability of carrying out research activities for developing vaccines using various advanced genetic engineering technologies, molecular biology, bacterial culture, animal cell culture, small scale and pilot scale fermentation, purication & analytical characterization and formulation development. It is equipped with all the necessary infrastructure and scientic manpower to carry out innovative research in the areas of antigen design, expression of antigen in a suitable host system and its purication. This is followed by formulation of antigen with suitable adjuvant and immunological evaluation in animal model.

The Company has pioneered in the development of viral vaccine, recombinant vaccine, sub-unit vaccine and polysaccharide conjugate vaccines, using both mammalian and bacterial expression platforms. In last one year, ORC has done signicant progress in these major areas of research including development of DengiAllR, NucoVacR11 and a multi epitope nano-particle based broadly protective beta corona virus vaccine candidate. Each of these programs will signicantly addr ess the healthcare burden that the diseases pose and build a sustainable future based on innovation. The R&D center has established a high cell density E.coli platform for production of recombinant antigens and proteins. This will help in developing recombinant molecules as antigen / therapeutics and as carrier protein for conjugated vaccine.

The R&D center has a strong team to take care of the conjugation aspect of many polysaccharide-based vaccines such as for typhoid, meningitis and many more in near future. The ORC team is also engaged in carrying out research for development of several other vaccines which are in our future product pipeline.

In R&D Centre we are trying to develop a multi epitope nanoparticle based broadly protective beta coronavirus candidate vaccine to protect against MERS, SARS-CoV-1 and SARS-CoV-2, wherein the focus is to select a lead antigen through pre-clinical testing, and initial clinical development. This research activity is supported by The Coalition for Epidemic Preparedness Innovations (CEPI) and is in collaboration with the Translational Health Science and Technology Institute (THSTI), an autonomous institute of the Department of Biotechnology, Ministry of Science and Technology, Government of India.

We are also continuously exploring to have collaborative research activities with various institutions for development of plant-based protein as nutrition supplement.

SAMPANN R&D Center at Lalru

SAMPANN R&D Center of Panacea Biotec Pharma at Lalru, Punjab continues to focus on Research & Development in various therapeutic areas with a constant focus on developing di cult to develop formulations focused on chronic and super speciality therapeutic areas. Panacea Biotec has deep experience in developing innovative drug delivery based products that enjoy considerable brand equity amongst physicians.

Panacea Biotecs nanotechnology-based product PacliALLR (Paclitaxel protein bound in human albumin particles) was launched in 2011. At the time, it was the worlds orst generic for AbraxaneR, manufactured by Celgene, USA (now part of Bristol - Myers Squibb Group). This demonstrates the Companys ability to handle the most complex generics and deliver a high-quality product in constrained and challenging timelines.

In the field of pharmaceutical research, Panacea Biotec has developed different innovative technologies such as hydro gel based topical drug delivery system of peptides and herbal drugs, solid-solid dispersion for highly variable drugs, Self-emulsifying drug delivery system (SEDDS) and controlled release drug delivery systems in different therapeutic areas.

SAMPANN R&D Center is in the advanced stage of development of new products for US, Europe and ROW markets in the therapeutic segments of immuno-suppressant, diabetes and pain management, etc.

SAMPANN R&D Center has also successfully developed nutrition products in the paediatric segment and is developing new dosage forms and products like baby cereals, bars, gummies, oils, cosmetics to expand the product portfolio in other specialties like gynaecology and adult nutrition.

Clinical Research

Clinical research is a critical function that guides clinical decisions based on facts and scientic data through clinical studies on vaccines and drugs that can a ect the health and well-being of millions of people. Panacea Biotec continuously undertakes clinical trials (Phase I, Phase II and Phase III) for all its investigational new vaccines and drugs as well as bioequivalence studies (as per New Drugs and Clinical Trials Rules 2019) for its innovative and generic product portfolios across both vaccines and pharmaceutical products.

Phase III Clinical trial for Td (Tetanus and Diphtheria reduced) Vaccine - TedShotR in Adolescents has been completed during the year. Phase III clinical trial for tetravalent Dengue vaccine, DengiAllR in adults, in collaboration with ICMR, has recently been initiated. Phase II/III Clinical trial for 11-valent Pneumococcal Conjugate Vaccine (NucoVacR11) is slated to be initiated this year.

Intellectual Property

Panacea Biotec has a strong portfolio of intellectual property in the form of patents, trademarks and copyrights in both vaccines and pharmaceutical formulations business. As of March 31, 2024, Panacea Biotec Group has led over 487 patent applications in over 65 countries including India, which include 14 patent applications pending grant and patent applications which were prosecuted.

As of March 31, 2024, Panacea Biotec Group has been granted over 465 patents globally out of which 40 are active. Some of the countries where patents have been granted are India,

USA, Germany, Mexico, Brazil, Japan, Russia, Canada, China, Sri Lanka, Ukraine, South Korea, Nigeria, Indonesia, Malaysia, Philippines, Vietnam and the African Regional Intellectual Property Organisation (ARIPO), an internal organisation comprising of 22 countries), etc.

Panacea Biotec Group has led 476 trademark applications for registrations, out of which 191 have been registered in India, 175 have been registered outside India and 110 applications are pending registration as on March 31, 2024. Further, the Group has 96 registered copyrights as on March 31, 2024.

Human Resources

At Panacea Biotec, employees are the core strength of its continuous growth in all the segments. We continue to build our internal talent pipeline through cadre and capability building interventions. Panacea Biotec strongly believes in developing and grooming managers and leaders from within the organization. We have laun ched campus hiring in manufacturing plants with a clear objective that in next 3 to 4 years we stop lateral hiring. The Company continues to invest in the creation of a work culture representing a unique mix of its values and functional expertise and the employees are partners to achieve Vision of the Company.

Diversity and inclusion are an important organizational agenda. Taking our agenda of increasing diversity representation in the organization we have undertaken a target to increase women representation to upto 16% of our total manpower, over the next 3 years. Currently around 8.5% of our total manpower comprises of women.

As on March 31, 2024, Panacea Biotec Group had a total manpower of ~2,209 employees (including ~273 through contractors) of which over 1,600 are skilled employees including corporate and managerial sta , sales sta , and sta located at its manufacturing facilities. There are ~129 R&D professionals including ~73 scientists engaged in R&D Centers, ~955 employees are engaged in production, quality control and quality assurance, ~292 employees are engaged in sales & marketing and logistics and ~833 in other functions. Out of total employees, ~907 employees (including ~117 through contractors) are the employees of Panacea Biotec Pharma Limited.

Panacea Biotec provides meaningful opportunities for learning and growth & continuously encourage its employees to widen the horizon for professional growth. Panacea Biotec provides opportunities for employees to reskill, up-skill, multi-skill and multi-task. As a part of this, nearly 95% of the workmen in manufacturing units have undergone certiocation through LSSDC - Life Sciences Sector Skill Development Council, a not for prot, non-statutory certication body under mandate of Ministry of Skill Development and Entrepreneurship, Government of India. Panacea Biotecs endeavour has been to create a culture of high and di erentiated performance where people continue to push boundaries of growth and self-development.

During the onancial year, we leveraged digitalization of processes leading to reduced human intervention and are closely tracking productivity metrics across business units to ensure better delivery of business. We have added additional features to our own internally developed tool NIKHAR - our digital capability to monitor sales productivity and provide data analytics to employees engaged in sales & marketing to take informed and timely decisions. We have implemented Darwin Box, our new Human Resource Management System (HRMS) in the month of October 2023, in line with organizations objective of making HR operations One Click.

To carry forward Panacea Biotecs way of execution excellence, we conducted"Jaan Pehchan Ho, Kaam Aasan Ho - Face to Face Meeting" among employees at manufacturing facilities, across functional areas and across di erent levels and plan continuing with it. We continue to conduct "Quality is Present" campaign across our manufacturing facilities wherein all the employees are taken through our Quality Mantra "Iss Pal Mein, Har Pal Mein Sahi Se Karna, Likhna and Bolna hi Quality Hai".

Our autonomous team with self-nominated members and a self-nominated CAPTAIN continue to perform at the highest level and ensure quality of the products manufactured by Panacea Biotec with clear objective of "Patient Safety". Currently, there are 76 Captains working in di erent areas with a team of ~500 employees. These team members are now shaping the new behaviour needed to succeed in all aspects of life including the Quality at Panacea Biotec.

We are very proud to announce that with teamwork and dedication we have been able to nally overcome all the operational and developmental challenges with proper due diligence to manufacture DengiAllR Vaccine. This reec ts our mission to continue to research and develop innovative vaccines. The clinical trial batches have been successfully manufactured and Phase-III Clinical Trials have recently been initiated in collaboration with the Indian Council of Medical Research (ICMR).

Birthday celebrations once a month for all the employees born in the month are conducted across the organization with participation across the hierarchy. Festivals are also celebrated across locations. Recognition of good work is done through simple framework of recognition by issuance of Appreciation certiocate with a citation. We continue to provide job rotation opportunity for those who desire to be moved around or add / modify areas to their work prole .

We continue to give rst opportunity to internal talent for the vacant positions or new positions created due to any reasons through internal job posting across the organization. Also, to ring fence key talent, additional job responsibilities are given to them through market bench marking, structured communication and engagement with employees. We also organize development and coaching programs for leadership teams based on the dened requirements.

Strategic partnerships and collaborations

Panacea Biotec has established relationships with various key business associates, including institutional customers for its products, strategic partners for entry into new international markets and domestic & international partners who market / distribute its products across several countries in the world. Panacea Biotec has a long-standing relationship with the UNICEF, PAHO and the Government of India, which has helped in participating in immunization programs in India and globally.

Panacea Biotecs collaborations has enabled it in developing innovative, cost e ective and quality vaccines and helped in achieving its goal of providing cost-e ective vaccines to the global population. Panacea Biotecs collaborations include partnership with the National Institutes of Health, USA for development and commercialization in Asia and African countries of its licensed tetravalent dengue vaccine candidate, DengiAllR and its partnership with Serum Institute of India Pvt. Ltd. and its subsidiary for supply of one of the key constituents for the EasySixR vaccine and for introduction of hexavalent vaccine in national immunization programs in developing countries.

The Company has also collaborated with Indian Council of Medical Research (ICMR), Government of India for Phase III clinical trials of DengiAllR. Panacea Biotec has entered into key partnerships with global pharmaceutical companies for marketing of pharmaceutical formulations in USA, Canada, EU and other international markets, which has helped Panacea Biotec in expanding its reach and access to new regulated markets.

Panacea Biotec will continue to strengthen its business development team and leverage its strengths in product development and navigating the regulatory landscape to capitalize on opportunities across new-age technologies that will strengthen and reposition its portfolio in the coming years.

Internal Audit & Internal Financial Control System

Panacea Biotec Group has a comprehensive internal control

system that commensurate with the size and nature of operations of the Group entities. This system spans across the organization including all the manufacturing and research & development facilities, warehouses & sales o ces besides corporate o ce.

The internal nancial controls have been developed and implemented at each business process across the Company and PBPL. The user level responsibilities are constantly shared with key users for their implementation and compliance. Checks & balances and control systems have been established to ensure that assets are safeguarded, utilized with proper authorization and recorded in the books of account. There is a proper deonition of roles and responsibilities across the organization to ensure information o w and monitoring.

The internal audits are conducted periodically by an internationally renowned independent audit orm PriceWaterhouseCoopers Services LLP (PwC), the internal auditors of Panacea Biotec. The Audit Committee of Panacea Biotec actively reviews the adequacy and e ectiveness of internal controls, internal audit systems and advises improvements as may be required. Post audit follow-ups are carried out to ensure identioed risks are addressed and recommendations of the Audit Committee are implemented.

Panacea Biotec has established and maintained adequate and e ective internal onancial controls over onancial reporting (IFCoFR) in accordance with the framework. Panacea Biotec with the help of the independent Internal Audit orm viz. PwC has performed an overall design assessment of the business processes as part of the Internal Financial control reviews. This includes review of policies and procedures adopted by Panacea Biotec for ensuring the orderly and e cient conduct of its business and oxing responsibility against all the controls. The design assessment was follow by the management testing of the controls across processes.

FINANCIAL PERFORMANCE

Summarized Consolidated Balance Sheet

( in million)

Particulars	As at March 31, 2024	As at March 31, 2023
Assets:
Fixed assets (net)	6,833.47	6,422.76
Financial assets	32.02	52.56
Other non-current assets	689.45	553.14
Current assets	4,851.77	5,623.20
Asset classified as held f or sale	-	60.00
Total Assets	12,406.71	12,711.66
Equity & Liabilities:
Total Equity*	8,420.46	8,436.03
Minority Interest	(38.21)	(34.89)
Non-current liabilities	936.14	992.21
Current liabilities	3,088.32	3,297.31
Liabilities associated with	-	21.00
Assets classified as held f or sale
Total Liabilities	12,406.71	12,711.66

*Excluding minority interest

Fixed Assets: The net x ed assets have increased to 6,833.47 million from 6,422.76 million as at the end of previous onancial year mainly on account of capital expenditure incurred on the expansion project at the Companys

manufacturing site at Lalru, Punjab.

Non-current Financial Assets: Non-current nancial assets include long-term investments, loans and other long-term nancial assets. The non-current nancial assets as of March 31, 2024 have decreased to 32.02 million from 52.56 million as at the end of previous nancial year, mainly due to decrease in bank deposits having maturity above 12 months.

Other Non-Current Assets: Other non-current assets include deferred tax asset (net of MAT credit) and other non-current assets. The non-current assets as of March 31, 2024 have increased to 689.45 million as against 553.14 million as at March 31, 2023, mainly due to segregation of GST input credit balances as non-current assets and current assets.

Current Assets: Current assets include inventories, trade receivables, cash & cash equivalents, other bank balances, short-term loans and other current assets. Total current assets as of March 31, 2024 have decreased to 4,851.77 million as compared to 5,623.20 as at the end of scal 2023, mainly due to decrease in the value of inventories and cash & bank balances pursuant to higher sales and capital expenditure incurred by the Company.

Assets held for sale: The Company did not have any oxed assets classioed as held for sale as on March 31, 2024. The process of sale of assets held for sale of 60.00 million as on March 31, 2023, has been completed during the onancial year under review.

Total Equity: Total Equity represents Equity Share Capital and other Equity. Total Equity marginally decreased to 8,420.46 million as at March 31, 2024 as compared to 8,436.03 million as at March 31, 2023, mainly on account of losses during the nancial year under review.

Non-Current Liabilities: Non-current liabilities include long-term borrowings (excluding current maturities), provisions and other non-current liabilities. The non-current liabilities as of March 31, 2024 have decreased to 936.14 million as compared to 992.21 million as of March 31, 2023, mainly on account of reduction in borrowings.

Current Liabilities: Current liabilities include short-term borrowings, trade payables and other current onancial liabilities (including current maturities of long-term borrowings). The current liabilities as at March 31, 2024 have decreased to 3,088.32 million as compared to 3,297.31 million as at March 31, 2023, mainly due to decline in trade payables on account of higher payments to the suppliers.

Liabilities associated with Assets held for sale: The liabilities directly pertaining to the Companys Assets held for sale as of March 31, 2024 were Nil as compared to 21.00 million as of March 31, 2023 as the sale of the relevant immovable property was completed during the year under review.

Summarized Consolidated Statement of ProPt & Loss

( in million)

	For the year ended
Particulars	March 31, 2024	March 31, 2023
Revenue from operations	5,591.68	4,599.46
Materials consumed	2,301.26	2,526.60
Employee benets expense	1,495.67	1,264.84
Other expenses	1,995.36	1,787.61
Earning before Interest, tax, depreciation	(200.61)	(979.59)
and amortizations (EBITDA)
Finance Costs	35.81	44.37
Depreciation and amortization	367.11	391.23
expense
Other Income	257.96	516.63
Prot / (L oss) before tax and	(345.57)	(898.56)
exceptional items
Exceptional items	360.34	1,026.61
Profit / (Loss) Before Tax	14.77	128.05
Provision for Taxes (including	29.82	465.50
deferred tax)
Profit / (Loss) after Tax	(15.05)	(337.45)
Other comprehensive income	(3.84)	2.04
(net of tax)
Total comprehensive income	(18.89)	(335.41)
Basic and Diluted EPS*	(0.19)	(5.43)

*Earnings Per Share in per Equity Share of 1.

Revenue from Operations: The consolidated revenue from operations increased to 5,591.68 million for scal year 2024 from 4,599.46 million for scal year 2023, mainly due to higher institutional sales of pentavalent vaccine and bivalent oral polio vaccine as well as launch of Paclitaxel protein bound particles for injectable suspension in Canada.

Other Income: Other income was 257.96 million during scal year 2024 as compared to 516.63 million for scal year 2023. Other income in scal year 2023 was higher due to write back of excess provisions pertaining to earlier years.

Materials Consumed: Materials consumed include consumption of raw & packing material and nished goods purchased during the year. The materials consumed were 2,301.26 million for scal year 2024 as against 2,526.60 million for scal year 2023. The materials consumed were higher in scal year 2023 due to one-time provisioning of the materials related to Covid-19 (Sputnik V) vaccine.

Employee beneots expenses: The employee beneots expenses have increased to 1,495.67 for oscal year 2024 from 1,264.84 million for oscal year 2023, primarily on account of annual increments and increase in manpower relating to vaccine business and nutrition business in India.

Other Expenses: Other expenses have increased to 1,995.36 million for scal 2024 as compared to 1,787.61 million for scal 2023, primarily due to increase in the legal & professional expenses following the arbitration cases led against / by the Company and PBPL, higher consumption of stores & spares and power & fuel expenses largely due to higher operations during the year under review.

Finance costs: Finance costs comprising of interest and bank charges have signiocantly declined from 44.37 million during scal year 2023 to 35.81 million for scal year 2024 following repayment of the debts.

Depreciation and amortization expenses: Depreciation and amortization expenses were 367.11 million for scal 2024 as against 391.23 million for scal 2023.

Exceptional items: Exceptional items represent recognition of the deferred revenue related to the sale of domestic pharmaceutical brand portfolio of PBPL in 2022. The deferred revenue recognised during oscal 2024 was 360.34 as compared to 1,026.61 million for scal 2023.

Proot / (Loss) before Tax: The proot before tax was 14.77million for scal year 2024 as against 128.05 million for scal year 2023, because of the factors discussed above.

Prot / (Loss) after Tax: The total loss after tax was 15.05 million for scal 2024 as compared to loss after tax of 337.45 million for scal 2023, because of factors discussed above.

The total basic and diluted loss per share was 0.19 for scal

year 2024 as against loss per share of 5.43 for scal year 2023.

Summarized Consolidated Cash Flow Statement

Cash Flow from Operating Activities: Net cash used in

( in million)

	For the year ended
Particulars	March 31, 2024	March 31, 2023
Cash & Cash Equivalent at the beginning	398.52	503.50
Net Cash flows from Operating Activities	(1.00)	(4,224.52)
Net Cash flows from Investing Activities	102.27	4,303.31
Net Cash flows from Financing Activities	(28.08)	(183.73)
Effect of Exchange rate changes	0.03	(0.04)
Cash & Cash Equivalent at the end	471.74	398.52

operating activities was 1.00 million in fiscal year 2024 as compared to 4,224.52 million in Fiscal 2023. The net cash used in operating activities in fiscal year 2023 was higher because of payment of statutory dues relating to the sale of domestic pharmaceutical brands portfolio of PBPL in scal year 2022, within the prescribed timelines.

Cash Flow from Investing activities: Net cash generated from investing activities was 102.27 million for Fiscal 2024 as compared to 4,303.31 million for scal year 2023. During scal 2023, the net cash generation from investing activities was higher due to encashment of deposits for payment of statutory dues as mentioned above.

Cash Flow from Financing Activities: Net cash used in nancing activities decreased to 28.08 million in Fiscal 2024 as compared to 183.73 million in Fiscal 2023. During Fiscal 2023, the debt repayment was higher than Fiscal 2024.

Financial Ratios

The onancial ratios for onancial year 2023-24 and their comparison with previous year including the reasons for variance wherever applicable, are given in Note 53 to the Standalone Financial Statements forming part of the Annual Report and hence not repeated here for the sake of brevity.

Opportunities and Outlook

The Company operates in a highly regulated and competitive environment across multiple geographies. Panacea Biotec group is engaged in research, development, manufacturing and marketing of a wide range of novel vaccines, branded and generic pharmaceutical formulations and nutrition products. The management continues to remain committed to grow the business building as on its strong foundation and executing its pipeline of products.

SWOT Analysis

Strengths

u Leading biotechnology company with over 30 years experience in development, manufacturing and

commercialization of vaccines and pharmaceutical

formulations.

u Signicant focus on exports

u State-of-the-art cGMP compliant manufacturing facilities

u Proven research & development and clinical research capabilities with multi-disciplinary R&D Centers

u Robust product pipeline of promising niche products to fuel long-term growth

u Extensive sales and distribution network

u Strategic partnerships and collaborations

u Strong promoter group supported by experienced and qualied management team.

Weaknesses

u Long gestation period on R&D Projects: R&D projects involve longer development time and medium to high

investment as is the norm in the vaccine and pharmaceutical industry. As a result of this, the present protabilit y is a ected whereas the output may come in medium to long term future periods.

u High dependence on institutional business in Vaccine Segment: A signiocant part of the vaccine business

revenues comes from tender driven institutional business. Panacea Biotec has decided to focus on expanding into private markets in India as well as in ROW countries through strategic tie-ups to have a diverse sales base and reduce its dependence on institutional business.

u Revenue concentration on few products: In vaccine segment, the revenue generation is mainly dependent on

two products i.e. pentavalent and hexavalent vaccine. Any future disruption in any of these products may impact the future nancial performance. The Company has expedited development of new products to expand the product portfolio and drive future growth.

Opportunities

u Expansion of vaccine manufacturing capacity: The Company is undertaking expansion of its drug substance

manufacturing capacities to meet the future growing

demand of its vaccines by UN agencies.

u New products in pipeline for commercial launch: There are several products under late stage of development in

vaccines, pharmaceutical formulations and nutrition business. The DengiAllR (Dengue vaccine) and NucoVacR11 (Pneumococcal vaccine) o er signiocant growth opportunities in the future.

u To improve capacity utilization: PBPL is exploring third party contract manufacturing opportunities to increase

capacity utilization of its manufacturing facilities.

u Addressing unmet need: Panacea Biotec is continuously working on development and launch of products to

address unmet needs.

Threats

u Dependence on few imported suppliers in drug substance. However, Panacea Biotec is focusing on

reducing its dependence on foreign suppliers by

developing in-house drug substances.

u Increasing Regulatory Compliances and Costs: International regulatory agencies like USFDA have started exercising

greater controls and compliances. As a result, the cost of compliance has also started increasing. Panacea Biotec group has been following the guidelines prescribed by WHO, USFDA and other regulatory agencies and save and except, recent observations / warning letter from USFDA which has been suitably responded / acted upon by Panacea Biotec Pharma, Panacea Biotec group has successfully passed several regulatory audits over the years.

u Pricing pressure amid intense competition in the pharmaceutical industry across the globe. However, the

Company remains focused on complex generic and

vaccines having lesser competition threat.

u Risk of all R&D initiatives not leading to commercially viable and successful products.

Future Growth Strategy

Vaccine Business

u Scaling up vaccine sales in private market in India including through launch of new vaccines.

u Increasing participation in institutional vaccine business with UNICEF, PAHO etc.

u Expediting development of tetravalent Dengue vaccine DengiAllR, Pneumococcal Polysaccharide Conjugate

Vaccine NucoVacR11 and other vaccines and launch

thereof in India and Institutional markets.

u Expanding manufacturing capacities to meet the future growing demand of vaccines.

u Supply of hexavalent vaccine EasySixR to UNICEF, PAHO and other international markets.

Pharma and Nutrition Business

u Growth in exports of pharmaceutical formulations to ICH market, emerging markets in LATAM and Middle East.

u Launch of Paclitaxel protein bound particles for injectable suspension, Cyclosporine and other products, which are

currently under approval, in USA and Europe.

u Filing more ANDAs / dossiers in USA, Europe and other emerging markets.

u Scaling up the nutrition business by launching new dosage forms and new customer segments.

Corporate Social Responsibility

Panacea Biotec recognizes Corporate Social Responsibility as one of its core values by making continuous e orts on spreading awareness on critical health issues impacting the quality of life. Panacea Biotec has been over the years, pursuing Corporate Social Responsibility by putting continuous e orts in the areas of health, education and patient awareness / assistance programs towards the development of a happier and healthier society.

Safety, Health and Environment Protection

The Company operates with a deep commitment to environmental stewardship, sustainability, and the well-being of people. A dedicated Environment, Occupational Health, and Safety (EOHS) department oversees these critical areas, supported by independent consultants who conduct thorough evaluations of our EOHS activities.

We are strongly committed to business practices that foster socially and environmentally responsible economic growth. Our EOHS policy ensures a safe and healthy working environment for employees, contractors, sub-contractors, visitors, and the surrounding communities. We are making signicant progress towards our long-term EOHS vision of achieving Target Zero Harm: Zero Injuries, Zero Occupational Harm, and Zero Environmental Impact.

Panacea Biotec group has successfully attained certication in Integrated Management Systems at its manufacturing facilities in Lalru and Baddi. This certication encompasses ISO 14001:2015, which focuses on Environmental Management, ensuring that our operations are conducted with a strong commitment to minimizing environmental impact.

Additionally, it includes ISO 45001:2018, which emphasizes Occupational Health & Safety, ensuring a safe and healthy working environment for all our employees, contractors, and stakeholders. These certications reec t our dedication to maintaining the highest standards in environmental protection and workplace safety, aligning with our broader goals of sustainability and responsible business practices. The key initiatives include:

u Continued implementation of an EHS management system that promotes proactive compliance with

environmental, health, and safety standards, sets minimum expectations across our operations, and drives continuous improvement in EHS performance.

u Deployment of EOHS regulatory surveillance tools in all countries where we have signicant operations.

u Proactive EOHS compliance assessments through self- evaluations and an internal audit program, addressing

non-conformities with timely corrective and preventive

actions, while tracking progress.

u Establishment of targets to reduce the environmental impact of our operations, including energy and water

conservation, recycling, and waste reuse.

As part of our auditing process, Panacea Biotec identies and addresses critical areas requiring immediate corrective action and strives to prevent adverse health impacts on employees through health awareness sessions, medical facilities, and insurance benets .

Note: As a result of rounding o adjustments, the ogures / percentages in a column in various sections in the Annual Report may not add up to the total for such columns.