Shanghai Haohai Biotechnology Co., Ltd

2024 Internal Control Evaluation Report

All shareholders of Shanghai Haohai Biotechnology Co., Ltd.:

In accordance with the provisions of the Basic Standards for Enterprise Internal Control and its supporting guidelines and other internal control regulatory requirements (hereinafter referred to as the "Enterprise Internal Control Specification System"), combined with the Company's (hereinafter referred to as the Company's) internal control system and evaluation methods, and on the basis of daily supervision and special supervision of internal control, we evaluated the effectiveness of the Company's internal control as of December 31, 2024 (the reference date of the internal control evaluation report). I. Important Notices

It is the responsibility of the board of directors of the company to establish, improve and effectively implement internal control, evaluate its effectiveness, and truthfully disclose the internal control evaluation report in accordance with the provisions of the enterprise's internal control system. The Supervisory Board supervises the establishment and implementation of internal controls by the Board of Directors. Managers are responsible for organizing and leading the day-to-day operation of the company's internal controls. The Board of Directors, the Board of Supervisors, the directors, supervisors and senior management of the Company guarantee that there are no false records, misleading statements or material omissions in the content of this report, and assume individual and joint legal liability for the authenticity, accuracy and completeness of the content of the report.

The goal of the company's internal control is to reasonably ensure the legal compliance of operation and management, asset security, true and complete financial reports and related information, improve operational efficiency and effectiveness, and promote the realization of development strategy. Due to the inherent limitations of internal controls, it can only provide reasonable assurance that the above objectives will be achieved. In addition, there is a risk that the effectiveness of future internal controls will be inferred based on the results of internal control evaluations because changes in circumstances may lead to inappropriate internal controls or reduced compliance with control policies and procedures.

Conclusions of the internal control evaluation

1. Whether the company has any material deficiencies in the internal control over financial reporting on the reference date of the internal control evaluation report

□ Yes √ No

2. Conclusion of the evaluation of internal control over financial reporting

√ valid □ invalid

According to the identification of material deficiencies in the Company's internal control over financial reporting, there were no material deficiencies in the internal control over financial reporting as of the reference date of the internal control evaluation report, and the Board of Directors believes that the Company has maintained effective internal control over financial reporting in all material respects in accordance with the requirements of the standard system of internal control of the Company and relevant regulations.

3. Whether material deficiencies in internal control over non-financial reporting were found

□ Yes √ No

According to the identification of material deficiencies in the Company's internal control over non-financial reporting, the Company did not find any material deficiencies in the internal control over non-financial reporting as of the reference date of the internal control evaluation report.

4. Factors influencing the conclusion of the internal control effectiveness evaluation between the benchmark date of the internal control evaluation report and the date of issuance of the internal control evaluation report

□ Applicable √ Not applicable

There were no factors affecting the conclusion of the internal control effectiveness evaluation between the benchmark date of the internal control evaluation report and the date of issuance of the internal control evaluation report.

5. Whether the internal control audit opinion is consistent with the company's evaluation conclusion on the effectiveness of internal control over financial reporting

√ Yes □ No

6. Whether the disclosure of material deficiencies in the internal control audit report of non-financial reporting is consistent with the disclosure in the company's internal control evaluation report

√ Yes □ No

Evaluation of internal control

(1) Scope of internal control evaluation

In accordance with the risk-oriented principle, the company determines the main units, businesses and matters included in the evaluation scope, as well as high-risk areas.

1. The main units included in the evaluation scope include: Shanghai Haohai Biotechnology Co., Ltd., Shanghai Qisheng Biologics Co., Ltd., Shanghai Jianhua Fine Biological Products Co., Ltd., Shanghai Likangrui Bioengineering Co., Ltd., Shanghai Haohai Pharmaceutical Technology Development Co., Ltd., Shenzhen New Industry Ophthalmology New Technology Co., Ltd., Henan Cosmos Intraocular Lens Development Co., Ltd., Xiamen Nanpeng Optical Co., Ltd., and Nanpeng Guang

Xue (Hong Kong) Limited, Haohai Healthcare Holdings Co. Limited and Contamac Limited, UK.

2. Proportion of units included in the scope of evaluation:

Indicator Proportion (%)

The ratio of the total assets of the units included in the evaluation to the total assets of the company's consolidated financial statements is 81.4%

The total operating income of the units included in the evaluation scope accounted for 82.0% of the total operating income of the company's consolidated financial statements

3. The main operations and matters to be included in the scope of the evaluation include:

Organizational Governance, Strategy & Risk Management, Social Responsibility, Internal Information Transfer, Human Resources, Research & Development, Procurement Management, Sales Management, Asset Management, Treasury Activities, Financial Statements, Engineering Management, Outbound Investment.

4. High-risk areas to focus on include:

Research & Development, Procurement Management, Sales Management, Engineering Management.

5. Whether the above-mentioned units, businesses and matters included in the scope of evaluation, as well as high-risk areas, cover the main aspects of the company's operation and management, and whether they exist

in major omissions

□ Yes √ No

6. Whether there is a statutory exemption

□ Yes √ No

7. Other Notes

Not.

(2) The basis for internal control evaluation and the criteria for identifying internal control deficiencies

The company organizes and carries out internal control evaluation in accordance with the company's internal control system and regulatory requirements, and the company's internal management regulations.

1. Whether the specific criteria for identifying internal control deficiencies have been adjusted from previous years

□ Yes √ No

The board of directors of the company distinguishes the internal control of financial reporting and non-financial reporting internal control according to the requirements of the internal control system of the enterprise for the identification of major defects, important defects and general defects, combined with factors such as the company's size, industry characteristics, risk appetite and risk tolerance

The specific criteria for identifying internal control deficiencies applicable to the Company have been established and are consistent with those of previous years.

2. Criteria for identifying deficiencies in internal control over financial reporting

The quantitative criteria for the evaluation of internal control deficiencies in financial reporting determined by the Company are as follows:

Indicator Name Quantitative Standard for Major Defects Quantitative Standard for Important Defects Quantitative Standard for General Defects

The amount of the misstatement represents 0.5% of the total assets ≥ the misstatement 0.5% of the total assets of the misstatement <, 0.3% of the total assets < the misstatement

Percentage of total amount and 0.3% of total ≥ assets

The amount of the misstatement represents 5% of the total profit of the misstated ≥ of the profit The misstatement < 5% of the total profit and 2.5% of the total profit of the < misstatement

Proportion of total ≥ 2.5% of total profit

Illustrate:

Not.

The qualitative criteria for the evaluation of internal control deficiencies in financial reporting determined by the Company are as follows:

Nature of the defect Qualitative criteria

Major deficiencies 1. Ineffective internal control environment for financial reporting;

2. The company's directors, supervisors and senior managers have committed fraud;

3. The audit institution found that there was a material misstatement in the current financial statements, and the internal control failed to find it in the course of operation

the misstatement;

4. The audit committee and the internal audit institution have no supervision over the company's external financial reporting and internal control over financial reporting

Effect.

Significant deficiencies 1. Failure to select and apply accounting policies in accordance with generally accepted accounting standards;

2. Failure to establish anti-fraud procedures and control measures;

3. There is no corresponding control mechanism for the accounting treatment of unconventional or special transactions, or it is not implemented and there is none

corresponding compensatory controls;

4. There are one or more deficiencies in the control of the financial reporting process at the end of the period, and there is no reasonable guarantee for the preparation of financial results

The business report achieves the goal of truth and completeness.

General defects Other defects other than the above-mentioned major defects and important defects.

Illustrate:

Not.

3. Criteria for identifying deficiencies in internal control over non-financial reporting

The quantitative criteria for the evaluation of internal control deficiencies in non-financial reporting determined by the Company are as follows:

Indicator Name Quantitative Standard for Major Defects Quantitative Standard for Important Defects Quantitative Standard for General Defects

Direct property losses as a percentage of total assets ≥ direct property losses < total assets Total assets < direct property losses

0.5% of 0.5% of total assets and 0.3% of total assets ≥

0.3%

Direct property losses account for total profits ≥ direct property losses < total profits Total direct property losses < profits

5% of 5% of total profit and 2.5% of ≥ total profit

2.5%

Illustrate:

Not.

The qualitative criteria for the evaluation of internal control deficiencies in non-financial reporting determined by the Company are as follows:

Nature of the defect Qualitative criteria

1. The company's business activities seriously violate national laws and regulations;

2. The company's decision-making process is unscientific, resulting in major mistakes and major property losses to the company;

3. Lack of institutional control or systematic failure of important businesses, and lack of effective compensatory control;

4. Serious loss of middle and senior management personnel and senior technical personnel;

5. Negative news frequently appears, which has attracted great attention from the regulatory authorities and cannot be eliminated for a long time;

6. The results of the internal control evaluation determined that the defects were major and not rectified.

Important Deficiencies 1. Decision-making procedures lead to general errors;

2. There are defects in important business systems or systems;

3. Serious loss of business personnel in key positions;

4. The results of the internal control evaluation determine that the defects are important and have not been rectified;

5. Other situations that have a greater negative impact on the company.

General defects Control deficiencies other than the above-mentioned major defects and important defects.

Illustrate:

Not.

(3) Identification and rectification of internal control deficiencies

1. Identification and rectification of deficiencies in internal control over financial reporting

1.1. Material Defects

Whether the company had any material deficiencies in internal control over financial reporting during the reporting period

□ Yes √ No

1.2. Important Defects

Whether the company had any significant deficiencies in internal control over financial reporting during the reporting period

□ Yes √ No

1.3. General Defects

The general deficiencies in the internal control over financial reporting discovered by the Company in the internal control evaluation have been rectified during the reporting period, and such deficiencies do not affect the realization of the Company's internal control objectives over financial reporting.

1.4. After the above-mentioned rectification, on the base date of the internal control evaluation report, whether the company has any material internal control over financial reporting that has not completed the rectification

flaw

□ Yes √ No

1.5. After the above-mentioned rectification, it is important that the Company has no internal control over financial reporting that has not been rectified as of the reference date of the internal control evaluation report

flaw

□ Yes √ No

2. Identification and rectification of internal control deficiencies in non-financial reporting

2.1. Material Defects

Whether the company found any material deficiencies in internal control over non-financial reporting during the reporting period

□ Yes √ No

2.2. Material Defects

Whether the Company found any material deficiencies in internal control over non-financial reporting during the reporting period

□ Yes √ No

2.3. General Defects

The general deficiencies in the Company's internal control over non-financial reporting found in the internal control evaluation have been rectified during the reporting period, and such deficiencies do not affect the realization of the Company's internal control objectives over financial reporting.

2.4. After the above-mentioned rectification, on the base date of the internal control evaluation report, whether the company found that the internal control over non-financial reporting that had not completed the rectification was heavy

Big flaws

□ Yes √ No

2.5. After the above-mentioned rectification, on the reference date of the internal control evaluation report, whether the company found that the internal control over non-financial reporting that had not completed the rectification was heavy

To be defective

□ Yes √ No

4. Explanation of other major matters related to internal control

1. Rectification of internal control deficiencies in the previous year

□ Applicable √ Not applicable

2. The operation of internal control in the current year and the direction of improvement in the next year

√ Applicable □ Not applicable

In 2024, the Company's internal control system operated well, and through regular internal control tests, it identified and rectified the deficiencies in the internal control in a timely manner, and continued to promote the optimization of the internal control system, so as to reasonably ensure the legal compliance of the Company's operation and management, asset security, authenticity and integrity of financial reports and related information, improve operational efficiency and effectiveness, and promote the realization of the company's development strategy. During the reporting period, no major or important control deficiencies were found in the company's internal control system, and the company maintained effective internal control in all material aspects in accordance with the requirements of the company's internal control system and relevant regulations. For the general internal control deficiencies found in the process of internal control evaluation, rectification has been organized during the reporting period, and such deficiencies do not affect the realization of the company's internal control objectives in financial reporting.

In 2025, the Company will continue to deepen the construction of the internal control system, optimize the internal control environment, improve the internal control system, standardize the implementation of the internal control system, strengthen the supervision and inspection of internal control, improve the level of internal control management, strive to prevent various risks, and promote the healthy and sustainable development of the Company.

3. Explanation of other major matters

□ Applicable √ Not applicable

Chairman of the Board of Directors (authorized by the Board of Directors): Hou Yongtai

Shanghai Haohai Biotechnology Co., Ltd

March 22, 2025