/Tuoxin Pharmaceutical: Zhongtai Securities Co., Ltd.’s issuance sponsorship letter (application draft) regarding the issuance of shares by Tuoxin Pharmaceutical Group Co., Ltd. to specific targets in 2026

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Tuoxin Pharmaceutical: Zhongtai Securities Co., Ltd.’s issuance sponsorship letter (application draft) regarding the issuance of shares by Tuoxin Pharmaceutical Group Co., Ltd. to specific targets in 2026

Shenzhen Stock Exchange

2026/08/10

About Zhongtai Securities Co., Ltd.

Tuoxin Pharmaceutical Group Co., Ltd. will issue shares to specific targets in 2026

Issuing Sponsorship Letter

(application draft)

Sponsor (lead underwriter)

(Building 3, District 5, Hanyu Financial Business Center, No. 7000 Jingshi Road, High-tech Zone, Jinan City)

July 2026

Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

Statement of the sponsoring institution and sponsoring representative

Zhongtai Securities Co., Ltd. (hereinafter referred to as "Zhongtai Securities", "the sponsor" or "the sponsor") accepts the entrustment of Tuoxin Pharmaceutical Group Co., Ltd. (hereinafter referred to as the "Company", "Issuer" or "Tuoxin Pharmaceutical") to act as its sponsor for 2026 The sponsor of the annual stock issuance project to specific targets, and designated Li Zhibin and Xu Baiqing as the sponsor representatives for this sponsorship work, hereby issues a sponsorship letter for this project to the Shenzhen Stock Exchange (hereinafter referred to as the "Shenzhen Stock Exchange").

Zhongtai Securities and its sponsor representatives comply with the "Company Law of the People's Republic of China", "Securities Law of the People's Republic of China", "Measures for the Administration of Securities Issuance Registration of Listed Companies" and "Guidelines for the Content and Format of Information Disclosure by Companies Issuing Securities" No. 27 No. - Issuance Sponsorship Letter and Issuance Sponsorship Work Report", "Measures for the Administration of Securities Issuance and Listing Sponsorship Business" and other relevant laws, regulations and relevant provisions of the China Securities Regulatory Commission and the Shenzhen Stock Exchange. We shall be honest and trustworthy, diligent and responsible, issue this issuance sponsorship letter in strict accordance with the business rules, industry practice standards and ethics formulated in accordance with the law, and ensure the authenticity, accuracy and completeness of the documents issued. If the documents produced and issued by the sponsor for the issuer's issuance contain false records, misleading statements or major omissions, causing losses to investors, the sponsor will compensate investors for their losses in accordance with the law.

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Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

Section 1 Basic information on this securities issuance

1. Introduction to the sponsor institution, sponsor representative, and project team members

(1) Name of sponsor institution

Zhongtai Securities Co., Ltd.

(2) The sponsor’s designated sponsor representative

Zhongtai Securities designated Li Zhibin and Xu Baiqing as the sponsor representatives of Tuoxin Pharmaceutical Group Co., Ltd.'s 2026 stock issuance project to specific targets.

The practice status of the above two sponsor representatives is as follows:

Mr. Li Zhibin is the senior vice president of Zhongtai Securities Investment Banking Committee, the sponsor representative, and a non-practising member of the Chinese Certified Public Accountants. As a key member, he participated in projects such as Yanggu Huatai's issuance of convertible bonds to unspecified objects, Yanggu Huatai's issuance of stocks to unspecified objects in 2022, Riko Chemical's issuance of convertible bonds to unspecified objects, Tuoxin Pharmaceutical IPO, Caike Technology IPO, Yanggu Huatai's major asset restructuring, Weiming Pharmaceutical control acquisition and other projects. He also participated in the restructuring and coaching of multiple IPO projects and completed a number of NEEQ-listed projects. He has solid financial expertise and rich project experience.

Ms. Xu Baiqing, senior vice president of Zhongtai Securities Investment Banking Committee, sponsor representative, and non-practising member of the Chinese Certified Public Accountants. As a key member, he participated in projects such as the non-public issuance of Weilan Biotech, the issuance of Riko Chemical to specific objects through a simplified procedure, the issuance of convertible bonds by Riko Chemical to unspecified objects, the GEM IPO of Guabao Pets, the issuance of shares by Yanggu Huatai to purchase assets, and the main board IPO of Yilite Energy Equipment Co., Ltd. He has solid financial expertise and rich project experience.

(3) Information about the co-organizer and other project team members of this securities issuance project

Project co-organizer

Zhongtai Securities designated Zhu Yinxin as the project co-organizer of Tuoxin Pharmaceutical Group Co., Ltd.'s 2026 project to issue stocks to specific targets.

Ms. Zhu Yinxin, senior manager of the Investment Banking Committee of Zhongtai Securities. Participate as a key member

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Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

Gu Huatai has certain investment banking experience in projects such as the issuance of convertible bonds to unspecified objects and the IPO of Caike Technology.

Other project team members

Other project members of this issuance include: Li Xuesong, Sun Liangliang, and Liu Haoyang.

2. The type of securities issuance by the issuer

The issuer’s type of securities issuance is the GEM issuance of RMB ordinary shares (A shares) to specific objects.

3. Introduction to the issuer’s basic information

(1) Basic information of the issuer

Company Chinese name Tuoxin Pharmaceutical Group Co., Ltd.

Company English name TuoxinPharmaceuticalGroupCo.,Ltd.

Stock abbreviation: Tuoxin Pharmaceutical

Stock code 301089.SZ

Date of establishment of the joint-stock company: March 1, 2012

Launch date: October 27, 2021

Registered address: No. 515, Kelong Avenue, High-tech Zone, Xinxiang City, Henan Province

Legal representative Yang Xining

Registered capital 126.5445 million yuan

Phone 0373-6351918

Internet address www.tuoxinpharm.com

Email [email protected]

Unified social credit code 91410000731329432N

Licensed projects: food additive production; pharmaceutical production; drug import and export (projects that are subject to approval according to law can only be carried out with the approval of relevant departments. Specific business projects are subject to the approval documents or licenses of relevant departments). General projects: production of chemical products (excluding licensed chemical products); manufacturing of basic chemical raw materials (excluding the manufacturing of licensed chemicals such as hazardous chemicals); manufacturing of special chemical products (excluding hazardous chemicals); business scope Technical services, technology development, technology consultation, technology exchange, technology transfer, technology promotion; sales of chemical products (excluding licensed chemical products); sales of special chemical products (excluding hazardous chemicals); import and export of goods; import and export of technology; leasing of non-residential real estate; leasing of machinery and equipment; business management; business management consulting; engaging in investment activities with own funds (except for projects that require approval according to law, operating activities can be carried out independently with a business license)

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Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

(2) Issuer’s capital structure

As of December 31, 2025, the company's total share capital is 126,544,500 shares, and the share capital structure is as follows:

Item Quantity (shares) Ratio

Shares with sales restrictions 36,074,437 28.51% Shares without sales restrictions 90,470,063 71.49%

Total share capital 126,544,500 100.00%

(3) Information about the issuer’s top ten shareholders

As of December 31, 2025, the shareholdings of the company's top ten shareholders are as follows:

No. Name of shareholder Number of shares held (shares) Shareholding ratio 1 Yang Xining 34,455,650 27.23% 2 1461565ONTARIOINC. 17,297,407 13.67% 3 Cai Yuying 5,307,775 4.19% 4 Qu Guirong 3,974,500 3.14% 5 Zhang Mingyuan 3,437,107 2.72% 6 Dong Chunhong 2,025,000 1.60% 7 Xiong Ying 1,900,000 1.50% 8 Wang Xiuqiang 1,652,400 1.31% 9 Qian Xiaohong 337,300 0.27% 10 Yu Xiaodong 259,600 0.21%

Total 70,646,739 55.84%

(4) The issuer’s previous financing, cash dividends and changes in net assets

As of the date of issuance of this issuance sponsorship letter, the issuer’s previous fund-raising, cash dividends and changes in net assets are as shown in the following table:

Unit: RMB 10,000 Net assets at the end of the latest period before the initial public offering (as of

9,450.00

Until December 31, 2020)

Issuance time Issuance category Net fund raising Previous financing situation October 2021 Initial public offering 54,327.41

Total 54,327.41

Cumulative cash distribution after the initial offering (tax included) 9,463.61

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Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

Net assets at the end of the latest period before this issuance

148,417.67

Amount (as of December 31, 2025)

(5) Main financial data and financial indicators of the issuer

ShineWing has conducted a review of the company's consolidated and parent company balance sheets as of December 31, 2023, December 31, 2024, and December 31, 2025, the consolidated and parent company income statements, consolidated and parent company cash flow statements, consolidated and parent company changes in shareholders' equity statements, and financial statement notes for 2023, 2024, and 2025. Audited, and issued the "2023 Annual Audit Report" (XYZH/2024ZZAA1B0242), "2024 Annual Audit Report" (XYZH/2025ZZAA1B0230) and "2025 Annual Audit Report" (XYZH/2026ZZAA1B0068) standard unqualified audit report.

Main data of the consolidated balance sheet

Unit: 10,000 yuan

Item December 31, 2025 December 31, 2024 Total assets on December 31, 2023 166,529.64 175,824.39 183,899.46 Total liabilities 18,111.97 20,572.39 23,572.27 Equity attributable to shareholders of the parent company 148,417.67 155,252.01 160,327.19 Shareholders’ equity 148,417.67 155,252.01 160,327.19

Main data of the consolidated income statement

Unit: 10,000 yuan

Item 2025 2024 2023 operating income 37,834.36 42,169.41 83,551.00Operating profit -7,175.75 -2,371.82 32,168.39Total profit -7,238.54 -2,773.25 31,653.34 Net profit attributable to the owners of the parent company -6,966.10 -1,988.49 24,307.27 Net profit attributable to the owners of the listed company after deducting non-recurring gains and losses

-7,893.81 -2,725.54 23,197.02Net profit

Main data of the consolidated cash flow statement

Unit: 10,000 yuan

Project 2025 2024 Net cash flow from operating activities in 2023 -2,618.69 10,266.87 2,695.34 Net cash flow from investing activities 9,554.06 -13,987.61 -12,860.76

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Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

Item 2025 2024 Net cash flow generated from financing activities in 2023 -121.00 -3,257.29 -6,907.23 Impact of exchange rate changes on cash and cash equivalents -28.79 82.88 11.14 Net increase in cash and cash equivalents 6,785.58 -6,895.15 -17,061.52

Main financial indicators

Financial indicators for 2025, 2024, and 2023

/2025.12.31 /2024.12.31 /2023.12.31

Current ratio (times) 4.01 4.10 4.23 Quick ratio (times) 2.55 2.85 2.95 Asset-liability ratio (parent company) 5.11% 7.28% 9.58% Asset-liability ratio (consolidated) 10.88% 11.70% 12.82% Interest coverage ratio Not applicable Not applicable Not applicable Accounts receivable turnover rate (times/year) 5.52 3.66 8.63 Inventory turnover rate (times/year) 1.55 1.54 1.58 Net profit attributable to owners of listed companies

-6,966.10 -1,988.49 24,307.27 profit (10,000 yuan)

Attributable to owners of listed companies, deductions for non-

-7,893.81 -2,725.54 23,197.02Net profit after recurring gains and losses (10,000 yuan)

Basic earnings per share (yuan) -0.55 -0.16 1.93 Diluted earnings per share (yuan) -0.55 -0.16 1.93 Gross profit margin 26.38% 29.87% 57.88% Weighted average return on equity -4.59% -1.26% 16.35% Note 1: The calculation method of the above financial indicators is as follows:

(1) Current ratio = current assets/current liabilities

(2) Quick assets = current assets − inventories − prepayments − non-current assets due within one year − other current assets

(3) Asset-liability ratio (parent company) = (total liabilities of the parent company/total assets of the parent company) × 100%

(4) Asset-liability ratio (consolidated) = (Total consolidated liabilities of the company/Total consolidated assets of the company) × 100%

(5) Interest coverage ratio = (total profit + interest expense) / interest expense

(6) Accounts receivable turnover rate = operating income/average balance of accounts receivable

(7) Inventory turnover rate = operating cost/average inventory balance

(8) Basic earnings per share = P0÷S

S=S0＋S1+Si×Mi÷M0–Sj×Mj÷M0-Sk

Among them: P0 is the net profit attributable to the company's common shareholders and the net profit attributable to the company's common shareholders after deducting non-recurring gains and losses; S is the weighted average number of common shares outstanding; S0 is the total number of shares at the beginning; S1 is the number of shares increased during the reporting period due to the conversion of public reserve funds to share capital or stock dividend distribution; S i is the number of shares increased due to the issuance of new shares or debt-for-equity swaps during the reporting period; Sj is the number of shares reduced due to repurchase during the reporting period; Sk is the number of shares reduced during the reporting period; M0 is the number of months in the reporting period; Mi is the cumulative number of months from the month after the increase in shares to the end of the reporting period; Mj is the cumulative number of months from the month after the share reduction to the end of the reporting period.

(9) Diluted earnings per share = P/(S0+S1+Si×Mi÷M0-Sj×Mj÷M0—Sk+weighted average number of common shares increased by warrants, share options, convertible bonds, etc.)

Among them, P is the net profit attributable to the company's common shareholders.

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Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

(10) Weighted average return on equity = P0/(E0＋NP÷2＋Ei×Mi÷M0-Ej×Mj÷M0±Ek×Mk÷M0)

Note 2: The company has no interest-bearing liabilities and does not need to pay interest. The interest coverage ratio is not applicable.

Return on net assets and earnings per share

According to the China Securities Regulatory Commission's "Information Disclosure and Preparation Rules for Publicly Offering Securities Companies No. 9 - Calculation and Disclosure of Return on Net Assets and Earnings per Share (Revised in 2010)", the calculation of the company's return on net assets and earnings per share during the reporting period is as follows:

Weighted average net assets Earnings per share (yuan)

Profit during the reporting period

Yield (%) Basic earnings per share Diluted earnings per share

2023 16.35% 1.93 1.93 belongs to the company’s common shares

2024 -1.26% -0.16 -0.16 Shareholders’ net profit

2025 -4.59% -0.55 -0.55

2023 15.60% 1.84 1.84 excluding non-recurring gains and losses

Net profit attributable to the company's ordinary shareholders in 2024 -1.73% -0.22 -0.22

2025 -5.20% -0.62 -0.62

4. Sponsor’s explanation of relevant circumstances that may affect the fair performance of duties

(1) As of the date of issuance of this issuance sponsorship letter, Zhongtai Securities or its controlling shareholders, actual controllers, or important related parties do not hold shares in the issuer or its controlling shareholders, actual controllers, or important related parties.

(2) As of the date of issuance of this issuance sponsorship letter, the issuer or its controlling shareholder, actual controller, or important related party does not hold shares in Zhongtai Securities or its controlling shareholder, actual controller, or important related party.

(3) As of the date of issuance of the sponsorship letter for this issuance, the sponsor representative of Zhongtai Securities and his spouse, as well as the directors and senior managers of Zhongtai Securities have no rights and interests in the issuer or hold any office in the issuer.

(4) As of the date of issuance of this issuance sponsorship letter, Zhongtai Securities’ controlling shareholders, actual controllers, and important related parties have not provided mutual guarantees or financing with the issuer’s controlling shareholders, actual controllers, or important related parties.

(5) As of the date of issuance of this issuance sponsorship letter, there is no other related relationship between Zhongtai Securities and the issuer.

5. Internal review procedures and core opinions of the sponsor institution

(1) Internal audit procedures

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Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

This sponsor has performed the following internal review procedures for the issuer’s securities issuance project:

The sponsor appointed a project team to conduct preliminary due diligence on the issuer; on May 14, 2026, the sponsor held a project establishment meeting to review the project. On May 18, 2026, the participating project committee members reviewed the project and voted to approve it; on May 19, 2026, the project establishment notice was completed and issued, agreeing to the project establishment.
The quality control department of the sponsor institution organized quality control reviewers to conduct an internal review of this project. The quality control auditors conducted on-site inspections, draft verification and review of application documents from May 21 to June 24, 2026. They reviewed whether the project complied with the issuance conditions, listing conditions and information disclosure requirements, and fully communicated with the project team (including the sponsor representative and project co-organizer).
The project team modified and improved the working papers and the full set of application materials based on the quality control review opinions. The quality control reviewers reviewed and approved the full set of application materials and accepted the project working papers. The project sponsor representative performed the inquiry and verification procedures. After completing the review and approval procedures, the full set of application documents were submitted to the Securities Issuance Review Department to perform the review process.
The Securities Issuance and Review Department will review the review application materials. With the consent of the person in charge of the review, the Securities Issuance Review Department will organize a review meeting.
On July 23, 2026, the sponsor's equity business review team held the 26th review meeting in 2026 to review this project. The participating review committee members collectively reviewed and voted on this project.
The Securities Issuance Review Department summarized the review results of the review meeting and issued the "Core Opinions on the Project of Tuoxin Pharmaceutical Group Co., Ltd. to Issuance of Stocks to Specific Objects." The project team responded to the "Internal Opinion on the Issuance of Stocks to Specific Objects by Tuoxin Pharmaceutical Group Co., Ltd." and modified the application materials. The internal opinion reply materials have been confirmed by the internal audit committee members attending the meeting.

(2) Core opinions

After collective deliberation and voting by the review committee members present at the meeting, the investment banking business review committee of the sponsor institution agreed to submit materials to the regulatory agency for this project.

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Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

Section 2 Commitments of the Sponsor

Zhongtai Securities promises that it has conducted due diligence and prudent verification on the issuer, its controlling shareholders and actual controllers in accordance with laws, administrative regulations and the provisions of the China Securities Regulatory Commission and the Shenzhen Stock Exchange, agreed to recommend the issuer's securities for issuance and listing, and issued this issuance sponsorship letter accordingly.

Through due diligence and careful review of application documents, Zhongtai Securities has made commitments on the following matters:

There are sufficient reasons to believe that the issuer complies with laws and regulations and the relevant regulations of the China Securities Regulatory Commission and the Shenzhen Stock Exchange on the issuance and listing of securities.
There are sufficient reasons to believe that the issuer’s application documents and information disclosure materials do not contain false records, misleading statements or major omissions.
There are sufficient reasons to believe that the basis for the opinions expressed by the issuer and its directors in the application documents and information disclosure materials is sufficient and reasonable.
There are sufficient reasons to believe that there is no material difference between the application documents and information disclosure materials and the opinions expressed by the securities service agency.
Ensure that the designated sponsor representative and relevant personnel of Zhongtai Securities have performed their duties diligently and conducted due diligence and careful verification of the issuer’s application documents and information disclosure materials.
Ensure that the issuance of sponsorship letters and other documents related to the performance of sponsorship duties do not contain false records, misleading statements or major omissions.
Ensure that the professional services and professional opinions provided to the issuer comply with laws, administrative regulations, regulations of the China Securities Regulatory Commission, Shenzhen Stock Exchange and industry norms.
Voluntarily accept regulatory measures taken by the China Securities Regulatory Commission and Shenzhen Stock Exchange in accordance with relevant regulations.

9. Comply with other matters stipulated by the China Securities Regulatory Commission and Shenzhen Stock Exchange.

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Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

Section 3 Sponsor’s recommendations for this securities issuance

As Tuoxin Pharmaceutical Group Co., Ltd. 2026 As a sponsor of annual stock issuance projects to specific objects, Zhongtai Securities, in accordance with relevant regulations such as the Securities Law, Registration Management Measures, Securities Issuance and Listing Sponsor Business Management Measures, Sponsor Due Diligence Work Guidelines, etc., the project team conducted due diligence on the issuer and carefully reviewed the application documents. The equity business core team conducted a collective review and fully communicated with the issuer, issuer's lawyer and issuer's accountant. After passing the approval, it is believed that Tuoxin Pharmaceutical's issuance of shares to specific objects complies with the issuance conditions stipulated in the Company Law, Securities Law, Registration Management Measures and other relevant laws, regulations and documents; Tuoxin Pharmaceutical's issuance and listing application documents do not contain false records, misleading statements or major omissions; this issuance and listing complies with the issuance conditions, listing conditions and information disclosure requirements; the shares issued this time are eligible for listing on the GEM of the Shenzhen Stock Exchange. Zhongtai Securities agreed to recommend that the shares issued by Tuoxin Pharmaceutical to specific targets be listed and traded on the GEM of the Shenzhen Stock Exchange.

1. The issuer’s decision-making process regarding the performance of this securities issuance

(1) Decision-making procedures of the issuer’s board of directors

On May 13, 2026, the issuer held the 12th meeting of the fifth board of directors, which reviewed and approved the "Proposal on the Company's Plan for Issuing A Shares to Specific Targets in 2026" and other proposals related to this issuance.

(2) Decision-making procedures of the issuer’s shareholders’ meeting

On June 25, 2026, the issuer held the first extraordinary shareholders' meeting in 2026, which reviewed and approved the "Proposal on the Company's Plan for Issuing A Shares to Specific Targets in 2026" and other proposals related to this issuance.

After verification, this sponsor believes that: in accordance with the provisions of the Company Law, Securities Law, Registration Management Measures and other laws and regulations as well as the issuer's Articles of Association, the issuer's application for issuance of shares to specific objects has completed a complete internal decision-making process.

This issuance still needs to be reviewed by the Shenzhen Stock Exchange and must be approved by the China Securities Regulatory Commission before it can be implemented.

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Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

2. Explanation on the compliance of this securities issuance

(1) This issuance meets the conditions stipulated in the Company Law

The stocks issued this time are all RMB ordinary shares with a face value of 1.00 yuan per share. Each share has equal rights. The issuance conditions and prices of new shares are the same. Any unit or individual must pay the same price for each share subscribed, which is in compliance with the provisions of Article 143 of the Company Law.

(2) This issuance complies with the issuance conditions stipulated in Articles 9 and 12 of the Securities Law

This issuance complies with the relevant provisions of Article 9 of the Securities Law: non-public issuance of securities shall not use advertising, public solicitation or disguised disclosure.
This issuance complies with the relevant provisions of Article 12 of the Securities Law: A listed company's issuance of new shares shall comply with the conditions specified by the securities regulatory authority of the State Council approved by the State Council. The specific management measures shall be prescribed by the securities regulatory authority of the State Council.

(3) There is no situation in this issuance that prohibits the issuance of stocks to specific objects as stipulated in Article 11 of the "Registration Management Measures"

As of the date of issuance of this issuance sponsorship letter, the company does not have the following circumstances that prohibit it from issuing shares to specific objects as stipulated in Article 11 of the "Registration Management Measures":

(1) Changing the use of funds raised previously without making corrections or without approval from the shareholders’ meeting;

(2) The preparation and disclosure of the financial statements of the most recent year do not comply with the provisions of accounting standards for enterprises or relevant information disclosure rules in major aspects; the financial accounting report of the most recent year has been issued with a negative opinion or an audit report in which an opinion cannot be expressed; the financial accounting report of the most recent year has been issued with an audit report with a qualified opinion, and the material adverse effects of the matters involved in the reserved opinion on the listed company have not been eliminated. Exceptions will be made if this issuance involves major asset restructuring;

(3) Current directors and senior managers have been subject to administrative penalties by the China Securities Regulatory Commission in the past three years or have been publicly condemned by the stock exchange in the past year;

(4) The listed company or its current directors and senior managers are being investigated by judicial authorities for suspected crimes or are being investigated by the China Securities Regulatory Commission for suspected violations of laws and regulations;

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Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

(5) The controlling shareholder or actual controller has committed major illegal acts in the past three years that have seriously damaged the interests of the listed company or the legitimate rights and interests of investors;

(6) There have been major illegal acts in the past three years that have seriously damaged the legitimate rights and interests of investors or the public interests of society.

(4) The use of funds raised from this issuance complies with the relevant provisions of Article 12 of the "Registration Management Measures"

The net proceeds from this issuance, after deducting issuance expenses, will be used for the construction of the "Bio-manufacturing base construction project for raw materials and healthy dietary supplements (Phase I)", in compliance with the following provisions of Article 12 of the "Registration Management Measures":

(1) Comply with national industrial policies and relevant laws and administrative regulations on environmental protection, land management, etc.;

(2) Except for financial enterprises, the funds raised this time shall not be used to hold financial investments, and shall not be invested directly or indirectly in companies whose main business is the purchase and sale of securities;

(3) After the implementation of the raised funds project, there will be no new horizontal competition or unfair related transactions that have a significant adverse impact on the controlling shareholders, actual controllers and other companies controlled by them, or seriously affect the independence of the company's production and operations.

(5) The company’s current issuance complies with the relevant provisions of Articles 55, 56, 57, 58, 59, 66 and 87 of the "Registration Management Measures"

The targets of this issuance are no more than 35 (inclusive) specific targets, including: securities investment fund management companies, securities companies, trust companies, financial companies, insurance institutional investors, qualified foreign institutional investors, RMB qualified foreign institutional investors (including self-operated accounts or managed investment product accounts of the above investors) and other institutional investors that comply with the regulations of the China Securities Regulatory Commission, as well as other legal persons, natural persons or other legal organizations that comply with the regulations of the China Securities Regulatory Commission. Securities investment fund management companies, securities companies, qualified foreign institutional investors, and RMB qualified foreign institutional investors that subscribe to two or more products under their management shall be regarded as one issuance target. As a target of issuance, trust companies can only subscribe with their own funds.

This issuance adopts a bidding method, and the pricing base date for this issuance of stocks to specific objects is the first day of the issuance period. The issuance price shall not be lower than the average stock trading price of the company in the twenty trading days before the pricing base date (the calculation formula is: average stock trading price in the 20 trading days before the pricing base date = total stock trading price in the 20 trading days before the pricing base day)

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Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

Amount/80% of the total stock trading volume in the 20 trading days before the pricing base date).

After the issuance is completed, the stocks subscribed by the issuance targets shall not be transferred within six months from the completion date of the issuance. If laws, regulations and normative documents have other provisions on the sales restriction period, those provisions shall prevail.

In this issuance, the company, its controlling shareholders, actual controllers and major shareholders have not made guaranteed income or disguised guaranteed income commitments to the issuance objects, and have not provided financial assistance or other compensation to the issuance objects directly or through stakeholders.

This issuance will not result in a change in control of the company.

In summary, this issuance complies with the provisions of Articles 55, 56, 57, 58, 59, 66 and 87 of the "Registration Management Measures".

(6) This issuance complies with the provisions of the "Opinion No. 18 on the Application of Securities and Futures Laws"

(1) Article 9 of the "Registration Management Measures" stipulates that, except for financial enterprises, there is no large financial investment at the end of the latest period. Financial investment includes but is not limited to investment financial business; non-financial enterprise investment financial business; equity investment unrelated to the company's main business, investment in industrial funds, M&A funds, borrowing funds, entrusted loans, and the purchase of financial products with large income fluctuations and high risks, etc. As of the end of the latest period, the company has no large financial investments, which is in compliance with the relevant provisions of the first point of the "Securities and Futures Law Application Opinion No. 18";

(2) Article 11 of the "Registration Management Measures" stipulates that if a listed company's "controlling shareholder or actual controller has committed major illegal acts that have seriously damaged the interests of the listed company or the legitimate rights and interests of investors in the past three years", or if the listed company has "committed major illegal acts that have seriously damaged the legitimate rights and interests of investors or the public interests of the society in the past three years", it shall not issue shares to specific objects. As of the date of issuance of this issuance sponsorship letter, the company, its controlling shareholders, and actual controllers do not have the above-mentioned matters, and are in compliance with the relevant provisions of the second point of the "Opinion No. 18 on the Application of Securities and Futures Laws";

(3) Article 40 of the "Registration Management Measures" stipulates that listed companies should "raise money rationally and determine the scale of financing reasonably." The number of shares to be issued in this issuance does not exceed 30% of the total shares before this issuance. The date of the board of directors' resolution of this issuance has been more than 18 months from the date of the previous fund raising, which complies with the relevant provisions of Point 4 of the "Opinion No. 18 on the Application of Securities and Futures Laws".

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Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

(4) Article 40 of the "Registration Management Measures" stipulates that "the funds raised this time will be mainly invested in the main business." The investment project with raised funds this time is the "Building Materials and Healthy Dietary Supplements Biological Manufacturing Base Construction Project (Phase I)". The raised funds will all be used for capital investment in the project, and will not be used to supplement working capital or repay debts. This is in compliance with the fifth point of the "Opinion No. 18 on the Application of Securities and Futures Laws".

(7) The company does not belong to the scope of enterprises that need to be punished as stipulated in the "Cooperation Memorandum on Joint Punishment of Untrustworthy Persons Subject to Enforcement" and the "Cooperation Memorandum on the Implementation of Joint Punishment of Untrustworthy Customs Enterprises", and does not belong to general untrustworthy enterprises and customs untrustworthy enterprises.

After verification, the company does not fall within the scope of enterprises that need to be punished as stipulated in the "Memorandum of Cooperation on the Implementation of Joint Punishments on Persons Defaulted to Execution" and the "Memorandum of Cooperation on the Implementation of Joint Punishments on Untrustworthy Customs Enterprises". It does not belong to general untrustworthy enterprises and customs untrustworthy enterprises, and has not committed any untrustworthy behavior that may affect the issuance of shares to specific objects.

3. Main risks of the issuer

(1) Risks related to the industry

Risks of macroeconomic cycle fluctuations

The API, pharmaceutical intermediates and functional food raw material industries in which the company operates have a strong correlation with the macro-economy. The company and even the entire industry are relatively sensitive to macro-economic changes. If there are adverse changes or adjustments in the international and domestic macro-economic situation, as well as national fiscal policies, trade policies and other macro-policies, or the national economy slows down or declines, it will lead to a decline or decline in the growth rate of downstream demand in the industry, which will in turn affect the company's profitability and financial status.

Market competition risks

The company is mainly engaged in the research, development, production and sales of nucleoside (acid) APIs and pharmaceutical intermediates. On the basis of consolidating the business of nucleoside (acid) APIs and pharmaceutical intermediates, it is actively expanding into the fields of functional food raw materials, non-nucleoside specialty APIs, and intermediate CMO/CDMO. In recent years, the reform of the national health system has been continuously promoted and deepened, and policies in the medical industry have been frequently introduced. The "Three Medical Linkage" policy is being advanced in depth, and the industry is facing multi-dimensional policy environment changes such as tightening quality supervision, normalization of centralized procurement, and reform of medical insurance payment methods. The market structure is being reshaped at an accelerated pace, industry competition is intensifying, and profit margins are being squeezed. In addition, in recent years, developing countries represented by India have

3-1-16

Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

With the support of capital and technology, similar companies from home and abroad are constantly pouring into the market, posing competitive pressure on domestic companies in terms of production costs and product prices, and the market competition is becoming increasingly fierce. If the company's products fail to continuously innovate in technology and ensure competitive advantages in terms of yield, impurity content and cost, they will face greater competitive pressure, which will have an adverse impact on the company's production and operations.

Risks of industry policy changes

The chemical raw materials and pharmaceutical intermediates industry in which the company operates is strictly supervised by a series of policies and regulations such as drug supervision, environmental protection, production safety, industrial access, import and export, and taxation. If there are major adjustments to national and local policies regarding drug registration and approval, Good Manufacturing Practice (GMP), environmental emission standards, safety production requirements, food additive supervision, dual energy consumption control, medical insurance procurement, API pricing and export control in the future, or if industry regulatory standards continue to become stricter, it may cause companies to increase compliance investment, upgrade production lines, extend product registration and certification cycles, increase operating costs, and even cause some products to be unable to continue to meet the latest regulatory requirements. The above situation may have an adverse impact on the company's promotion of products under development, sales of in-process products, implementation of new production capacity and continued operating capabilities.

(2) Risks related to the issuer

Business risks

(1) Product risk

①Risk of price fluctuations of major products

The company's current main products include three categories: APIs, pharmaceutical intermediates, and functional food raw materials. APIs and pharmaceutical intermediates are ultimately mainly used in the production of chemical generic drugs, and functional food raw materials are mainly used in the production of functional foods such as dietary supplements and nutritionally fortified foods. The company's product prices are mainly affected by market competition, downstream customer demand, industry production technology iterations, etc. As competition in the industry intensifies in the future, competitors may adopt low-price strategies to seize market share, and the company's product prices may be adversely affected; in addition, when the supply and demand relationship between downstream customers and the company changes in the future, the company may adopt price reduction sales strategies to maintain long-term cooperative relationships with customers. As a result, the company faces the risk of falling product prices.

②Risk of decline in gross profit margin

In each reporting period, the company's gross profit margin was 57.88%, 29.87% and 26.38% respectively, showing a downward trend.

3-1-17

Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

The gross profit margin in 2023 is significantly higher than that in 2024 and 2025. This is mainly due to the impact of public health events. The company's high-gross-margin anti-viral API product Azivudine has been sold in stages, which has greatly increased the company's overall gross profit rate. As the impact of public health events has gradually been eliminated, the high-gross-margin anti-viral API product Azivudine will no longer be sold starting in 2024, resulting in a significant decline in the overall gross profit rate level compared with 2023; 2025 compared with 2024 There was a slight decrease in the year, mainly due to the decline in the sales price of some products and the decline in revenue from high-gross-profit API products, which in turn lowered the company's overall gross profit rate.

The company has taken proactive measures to stabilize product profitability, including expanding intermediate CMO/CDMO and functional food raw material businesses, optimizing product structure, and strengthening cost control. However, if the supply and demand pattern of the industry changes in the future, market competition further intensifies, coupled with factors such as downward prices of major products, a decrease in the revenue share of high-margin products, and increases in raw materials, labor and manufacturing costs, the company's gross profit margin may still decline further, which may have a certain impact on operating results.

③Product substitution risk

The downstream drug application fields of the company's main products cover the fields of anti-viral, anti-tumor and nervous system drugs. Some major drugs have an important position in their application fields and occupy a large market share. However, it cannot be ruled out that with the passage of time and the accumulation of drug dosage, new adverse reactions will emerge, which will have an adverse impact on their application and sales, and in turn have an adverse impact on the company's related products. At the same time, with the development of modern medicine and the advancement of chemistry and biotechnology, treatments for related diseases and new alternative drugs may emerge and achieve major breakthroughs, which may have a major impact on existing drugs.

At the same time, with the continuous advancement of technology, the technical level and production process of APIs or pharmaceutical intermediates may change. If the company's product process route is not competitive and the company is unable to regain the competitive advantage of the product through R&D investment, there is a risk that the product will be replaced due to technological progress.

(2) Risk of raw material price fluctuations

The raw materials required for the production of the company's main products are mainly basic chemical raw materials. Their prices are affected by multiple factors such as commodity market cycles, energy price fluctuations, environmental protection regulatory policies, market supply and demand, etc., and there are certain cyclical fluctuation characteristics. In each period of the reporting period, the company's direct material costs accounted for 61.41%, 58.01% and 53.61% of the current main business costs respectively, accounting for relatively high proportions. Although the purchase price of the company's main raw materials showed an overall downward trend during the reporting period, if the price of upstream raw materials rises sharply in the future, it will directly push up the price.

3-1-18

Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

The production costs of the company and other companies in the industry. If the company cannot effectively hedge against the adverse effects of rising raw material prices by continuously optimizing production processes and transmitting cost pressures downstream, the company will face the risk of declining profitability, which will have an adverse impact on the company's production operations and financial status.

(3) Risk of customer loss

During the reporting period, the company's products were sold to more than 20 countries and regions at home and abroad, gradually covering many domestic and foreign APIs, preparations and functional food production or trading companies. It has established long-term cooperative relationships with well-known domestic and foreign companies such as Sinopharm International Pharmaceutical Technology (Beijing) Co., Ltd., Qilu Pharmaceutical Co., Ltd., Chenxin Pharmaceutical Co., Ltd., China Resources Shuanghe Limin Pharmaceutical (Jinan) Co., Ltd., KyowaHakko Baio K.K (Kyowa Hakko Biochemical Co., Ltd.). In each period of the reporting period, the sales revenue from the company's top five customers accounted for 63.58%, 27.97% and 30.34% of the current main business revenue respectively. Maintaining a good cooperative relationship between a company and its customers requires strong R&D capabilities, stable product delivery capabilities and high-quality customer service capabilities. Maintaining and improving the above capabilities requires the company to continuously optimize and improve in management, research and development, production, sales and other aspects. If the company cannot continue to optimize and improve in the above aspects in the future to continuously meet the needs of customers, the company will face the risk of losing customers.

(4) Environmental protection and production safety risks

The company's production process will produce waste water, waste gas, solid waste and other pollutants. The production process involves high temperature, high pressure and other processes, and it is an industry with strong supervision of environmental protection and production safety. As the country's "dual carbon" strategy continues to advance, environmental protection and production safety supervision continue to strengthen. If relevant environmental protection and safety standards are further improved in the future, the company will face continued pressure to increase investment in environmental protection and production safety. At the same time, if the company encounters environmental violations or safety production accidents in the production and operation process, it may face penalties such as suspension of production and rectification, fines, and revocation of relevant qualifications, which will have a significant adverse impact on the company's production and operation, brand reputation, and financial status.

(5) Overseas market risks

During the reporting period, the company's overseas sales revenue accounted for 10.04%, 22.93% and 23.84% of its main business revenue respectively. Overseas sales countries and regions mainly include India, Indonesia, Japan, the European Union, etc. In addition to direct sales to the Indian market, the company's products are also indirectly sold to the Indian market through domestic and foreign traders. The Indian market is the main overseas sales market for some of the company's products. India is the world's largest producer and supplier of generic drugs. However, due to the foundation of industrial development and the impact of international division of labor, India uses raw materials for drug production.

3-1-19

Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

More than 70% of raw materials and pharmaceutical intermediates are imported from China.

If there are major adverse changes in drug registration policies, import supervision requirements, trade tariff policies, anti-dumping and countervailing investigations, foreign exchange controls, geopolitics and international relations in major overseas markets such as India in the future, or if the local supply capacity of local APIs increases and the market competition intensifies, it may lead to a reduction in the company's overseas orders, blocked exports, delays in payment reimbursement or an increase in settlement costs, which will in turn have an adverse impact on the company's overseas business development, operating income and operating performance.

Financial risks

(1) Risk of performance decline in the latest period

From January to March 2026, the company achieved operating income of 92.5022 million yuan, a slight decrease from the same period last year; the net profit attributable to shareholders of the parent company after deducting non-recurring gains and losses decreased by 6.0458 million yuan from the same period last year, a decrease of 101.56%. The company's recent performance decline was mainly due to adverse factors such as increased depreciation and amortization and rising production costs caused by the increase in depreciation and amortization and rising production costs caused by the decline in revenue and gross profit margin of the pharmaceutical intermediates business due to the intensifying demand from downstream customers and market competition.

In response to the negative impact of declining performance, the company has actively developed markets and customers, optimized product structure, broadened business channels, improved production technology, and improved production efficiency. It also plans to extend the industrial chain vertically through this investment project, achieve independent control of core raw materials, and effectively reduce procurement costs. Through the above measures, the adverse impact on the company's performance is not expected to last and will not cause an irreversible decline in the short term.

If the macroeconomic situation experiences major fluctuations in the future, industry competition intensifies, market development is less than expected, technology research and development is blocked and fails to be implemented, strategic transformation progress is less than expected, and new business cultivation cycles are too long, the adverse effects of operating performance fluctuations cannot be mitigated, which may lead to the risk that the company's future operating performance will continue to decline.

(2) The risk of revenue decline and consecutive losses in the past two years

During the reporting period, the company's operating income was RMB 835.51 million, RMB 421.6941 million and RMB 378.3436 million respectively. The operating income showed a downward trend. The main reasons are: (1) Affected by the public health incident, the company's antiviral APIs Azivudine and Ribavirin achieved phased sales volume in 2023. As the impact of the public health event gradually eliminated, the revenue scale of the corresponding products has dropped significantly since the first quarter of 2023; (2) 2025 has declined compared with 2024, mainly due to the decline in market demand for the traditional antiviral API product Ribavirin and some

3-1-20

Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

The sales volume or sales price of pharmaceutical intermediates decreased.

In each reporting period, the issuer's net profits attributable to shareholders of the listed company were RMB 243.0727 million, RMB -19.8849 million and RMB -69.6610 million respectively, with continuous losses in the past two years. The main reasons are: (1) The decline in operating income leads to a decline in the company's profitability; (2) The company's provision for bad debt provisions for accounts receivable and inventory depreciation provisions increase.

The company's operating performance is highly correlated with changes in industry supply and demand patterns and downstream market demand. If external factors such as the industry market environment and market competition pattern continue to change in the future, the company's operating performance may be affected by certain uncertainties. The company will continue to optimize its product structure, strengthen cost control, promote the implementation of projects in Inner Mongolia, expand diversified businesses, and extend to the upstream industry chain and other measures to continue to improve profitability. (3) Risk of inventory price decline

At the end of each reporting period, the book value of the company's inventory was 204.1108 million yuan, 178.8826 million yuan, and 181.6118 million yuan respectively, accounting for 24.83%, 26.42%, and 31.05% of the current assets at the end of each period, which was relatively high. The company adopts the production model of "production based on sales + reasonable inventory", and arranges production and stocking based on customers' actual order volume and customer forecast purchase volume.

Although the company has prudently made provisions for inventory depreciation in accordance with relevant accounting regulations, the market supply and demand for raw materials and intermediates are prone to fluctuations in downstream customer demand, and industry competition is relatively strong. If there are major changes in subsequent market demand, product prices and customer purchasing plans, or product technology updates and substitutions occur, some inventory may be unsaleable and prices may decline. There is a risk of further inventory impairment and a decrease in turnover efficiency, which may have a certain adverse impact on the company's asset status, cash flow and operating results.

(4) Risk of adverse changes in tax preferential policies

During the reporting period, the issuer and some of its subsidiaries enjoyed a number of preferential tax policies, including preferential income tax policies for high-tech enterprises, additional VAT credits for advanced manufacturing industries, income tax reductions and exemptions for small and micro enterprises, and VAT exemptions, offsets, and refunds for exported goods. If the national preferential tax policies change in the future, or the company cannot continue to enjoy the corresponding preferential tax policies, the company's overall tax burden will increase, which will have a certain adverse impact on operating performance and profitability.

3-1-21

Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

Technical risks

(1) Risks of untimely development of new products

The company is a scientific and technological innovation enterprise that integrates chemical synthesis and biological fermentation technology and is mainly engaged in the research, development, production and sales of nucleoside (acid) APIs and pharmaceutical intermediates. In recent years, on the basis of consolidating the business of nucleoside (acid) APIs and pharmaceutical intermediates, the company has steadily expanded the three major business areas of functional food raw materials, non-nucleoside specialty APIs, and intermediate CMO/CDMO, and has gradually formed a business development pattern of "solid core business and coordinated development of multiple sectors". The company's long-term competitiveness depends on its ability to continuously develop and introduce new products to the market while maintaining its existing products. New product research and development requires the company's management to have keen market insight and be able to make timely decisions on whether and when to conduct new product research and development and promote the implementation of relevant departments. If the company cannot grasp the development trends of the API, pharmaceutical intermediates and functional food raw material industries and conduct timely research and development of new products, it may have an adverse impact on the company's production and operations.

(2) Risk of failure in new product development

The company's new product research and development needs to go through multiple links such as small trials, pilot trials, and large-scale production. Failure in any link in the middle may lead to the failure of product development. At the same time, during the product research and development process, the company needs to always pay attention to the situation of similar products on the market. If similar products on the market have more advantages than the products being developed by the company in terms of process, cost or environmental impact, the research and development of the company's related products may be forced to terminate.

In addition, for API products, the research and development process is more complicated because their production and sales require approval from the drug regulatory authorities. After completing internal research and development, API products need to apply to the drug regulatory department for review and filing. They can be produced and sold to customers only after the review and filing is passed. At the same time, due to various factors, the review and filing cycle for APIs is usually long, and there are cases where the filing fails. Even if some products are finally approved by the drug regulatory department and are allowed to be produced and sold, their market value may drop significantly due to missing the appropriate market entry point.

(3) Risk of loss of core technical personnel

The chemical pharmaceutical API manufacturing industry is a knowledge-intensive industry with high R&D barriers, especially in the field of API R&D. A technically strong R&D team and R&D strength are important factors for companies to maintain their leading edge in fierce market competition. With the rapid development and competition of the domestic chemical raw material pharmaceutical manufacturing industry,

3-1-22

Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

Intensified, the increasing demand for technical talents from companies in the same industry may lead to the company's brain drain. If the company cannot train or introduce the above-mentioned high-quality talents to meet its scale expansion needs, it may also have an impact on the company's operating performance and long-term development.

(3) Other risks

Risks related to investment projects using raised funds

(1) Risks in the implementation of investment projects with raised funds

The company's fundraising project was made after market research and careful demonstration, and specific plans and arrangements were made in terms of manpower and funds to ensure the construction of the fundraising project. However, if during the construction of the investment project, due to unforeseen factors, the company is unable to keep up with the project construction requirements in terms of personnel, technology, and funds, and the project implementation organization and management are ineffective, it may lead to certain uncertainties in the implementation progress and implementation effects of the project, which will have an adverse impact on the realization of the expected benefits of the investment project.

(2) The risk that the benefits of investment projects with raised funds cannot be fully realized

The funds raised this time will be invested in the construction project (Phase I) of a biological manufacturing base for raw materials and healthy dietary supplements. The issuer has conducted a detailed analysis of the risks and feasibility of the investment projects with raised funds. The market prospects and expected economic benefits of this raised investment project are good, but the profitability of the project is still facing the impact of intensifying market competition, adverse changes in the future market, declining sales prices, and less than expected market expansion, resulting in the risk of the project failing to achieve expected benefits.

(3) Capacity digestion risk of investment projects

The products produced by this investment project "Bio-manufacturing base construction project for raw materials and health dietary supplements (Phase I)" include inosine, hypoxanthine, guanosine, D-ribose, guanine, adenosine, adenine, cytidylic acid, and citicoline (sodium) series nucleoside (acid) products. After the completion of this project, the company will transfer the existing biological fermentation production capacity of inosine, guanosine, adenosine, hypoxanthine, guanine, adenine and D-ribose from the Xinxiang production base to the Inner Mongolia production base. At the same time, it will expand the production capacity of the existing advantageous product citicoline (sodium) and simultaneously build its supporting raw material cytidylic acid production line to optimize the production capacity layout and scale upgrading to further consolidate the company's core competitiveness in the field of nucleoside (acid) products.

Although the products produced by this fundraising project are all mature products of the company’s existing products or related products in the industry chain

3-1-23

Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

Upstream and downstream products, related products have strong downstream demand and good market prospects. The company can rely on its existing stable customer resources, mature sales channels and good market reputation to undertake the new production capacity of this fundraising project. However, if the future industry market growth rate is lower than expected and market competition intensifies, the company may face the risk of idle production capacity and the related production capacity cannot be absorbed in time.

(4) Risk of profit decline caused by new depreciation and amortization of investment projects

After the company's investment project is completed and reaches production, the company's fixed assets will increase. According to the company's current depreciation and amortization policies, new depreciation and amortization expenses will be increased by 14.6083 million yuan every year, and the new depreciation accounted for 3.86% of the company's operating income in the most recent year. With the completion of the investment project, the company's production capacity has been further improved, which will help improve profitability and sustainable development capabilities. However, if there are major adverse changes in the industry environment or market demand environment and the investment projects cannot achieve expected returns, the company will be at risk of declining profits due to increased depreciation and amortization.

(5) The risk that the benefits of the previous investment project are not as good as expected

The company's last raised-funded investment project, the "Nucleoside Series Characteristic API and Pharmaceutical Intermediates Construction Project", has reached the scheduled usable state in June 2025. However, due to the delayed qualification approval of some API products and the iteration of industry technology, the actual benefits of the project in 2025 did not meet expectations.

Some API products of this project are applying for CDE review and filing and EU CEP certification. In view of the fact that domestic and foreign drug regulatory agencies are extremely strict in reviewing the authenticity of API registration application materials, the stability of the production process, the safety and effectiveness of the product, and the compliance of the development and production sites. If the company's relevant application materials, process verification or on-site verification cannot meet the CDE or the review standards of overseas regulatory agencies, or may be affected by objective factors such as adjustments to relevant national pharmaceutical regulations and changes in the review and approval pace, which will lead to uncertainty in the review and approval progress and results of related products. If the approval of the relevant qualifications for the above products lags behind, or ultimately fails to pass the review, the commercialization process of the relevant products will be delayed, which will have an adverse impact on the realization of the expected benefits of the previous fundraising project and the company's overall operating performance.

Approval risks

This stock issuance plan still needs to be reviewed by the Shenzhen Stock Exchange and approved by the China Securities Regulatory Commission before it can be implemented. Whether it can ultimately pass the review by the Shenzhen Stock Exchange, obtain the China Securities Regulatory Commission's decision to approve the registration and the timing are still uncertain.

3-1-24

Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

Risk of failure of issuance or insufficient funds raised

This issuance of shares is a targeted issuance of shares to no more than 35 (inclusive) qualified specific targets to raise funds. Investors' subscription intention and ability are affected by various internal and external factors such as the overall situation of the securities market, the company's stock price trend, investors' recognition of the issuance plan, and market funding conditions. They may face the risk of insufficient funds raised or even failure of the issuance.

The risk of this issuance diluting spot returns

After the completion of this issuance, the company's total share capital and net assets will increase, and it will take a certain period of time to use the raised funds and generate benefits. In the case where the company's total share capital and net assets have increased, if the company's profits have not yet achieved a corresponding increase, the company's current returns in the year when this issuance is completed will be at risk of being diluted.

Stock price fluctuation risk

The company's stock price not only depends on the company's operating performance and development strategy, but is also affected by domestic and foreign macroeconomic conditions, capital market trends, market psychology and other factors. Therefore, there are certain uncertainties in the company's stock price and may fluctuate due to the above risk factors. Fluctuations in stock prices will directly or indirectly bring uncertainty to investors' investment returns.

4. Evaluation of the issuer’s development prospects

(1) The competitive landscape of the issuer’s industry

The company is a scientific and technological innovation enterprise integrating chemical synthesis and biological fermentation technology. It is mainly engaged in the research, development, production and sales of nucleoside (acid) APIs and pharmaceutical intermediates. It has strong strength in the development and production of domestic nucleoside (acid) APIs and pharmaceutical intermediates. In the field of domestic nucleoside (acid) APIs and pharmaceutical intermediates, the company has the advantages of early start, large scale, and complete varieties, and has formed a relatively complete product chain from basic products to high-end products. With more than 20 years of technological accumulation and continuous R&D innovation, the company has formed a product matrix covering key pharmaceutical intermediates such as cytosine, 5-fluorocytosine, hypoxanthine, and APIs such as citicoline sodium, ribavirin, acyclovir, and cyclophosphate, forming a vertically integrated industrial chain from basic chemical raw materials to terminal APIs.

3-1-25

Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

Competitive landscape of international API industry

Before the 1990s, Europe and the United States were the core production areas of the global API industry. With their mature chemical industry systems and leading synthetic technology levels, they occupied a dominant position in the global API industry chain. After the 1990s, affected by factors such as stricter environmental protection supervision, rising costs of production factors, and industrial restructuring of multinational pharmaceutical companies, European and American countries gradually reduced their own production capacity of APIs. Among them, most generic drug companies in the United States gradually reduced the layout of self-built API production facilities, and their dependence on external supply of APIs increased significantly. Against this background, emerging market countries represented by China and India have rapidly emerged with their complete chemical industry chain supporting facilities, outstanding cost control capabilities and large-scale production capacity advantages, and have gradually developed into the world's major API production and export regions, promoting structural adjustments in the global API industry chain.

In the field of specialty APIs, developed economies such as the United States and Europe still occupy core market positions in the field of high value-added patented APIs by virtue of their leading R&D innovation capabilities, mature production processes and complete intellectual property protection systems. Emerging market countries such as China and India occupy an important market share in the global generic drug API market by virtue of their cost advantages, large-scale production capabilities and rapid market response capabilities. In recent years, as specialty API companies in China, India and other countries have continued to increase investment in R&D, continuously optimize production processes, improve whole-process quality control levels, and deploy specialized production lines, a group of companies with core technology advantages, stable quality advantages, and large-scale production capacity advantages have gradually entered the competition in the global high-end API market and become important participants in the international specialty API supply chain system.

Competitive landscape of domestic API industry

my country's chemical raw material pharmaceutical industry has a high degree of marketization and relatively sufficient market competition. Among them, the bulk API subdivision has formed a mature industrial system. The domestic production technology is mature, the product categories are complete, and the production capacity is sufficient. my country has developed into the world's largest bulk API producer and exporter. According to statistical data released by the State Food and Drug Administration, there are a total of 1,712 API manufacturers in the country in 2024. Among them, the number of companies with annual operating income exceeding 10 billion yuan is relatively small. The industry as a whole presents a pattern of "large number of companies, small individual size, and low market concentration."

From the perspective of industry development level, there is still a certain gap between the overall R&D and innovation capabilities and core production technology levels of domestic API companies compared with developed economies such as the United States and Europe. Industry competition shows significant stratification characteristics: in the fields of bulk APIs and low-end generic APIs with low technical barriers, corporate layouts are concentrated and market competition is fierce; while in the fields of specialty APIs and patent-period APIs with high added value and high technical barriers,

3-1-26

Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

The number of market participants with core competencies is relatively limited.

From the perspective of the profitability level and development constraints of the industry chain, compared with the downstream preparation production and sales links, the overall profitability of the API industry is relatively low, and is susceptible to multiple factors such as upstream raw material price fluctuations, downstream customer demand changes, exchange rate fluctuations, etc., and there is a risk of periodic profit fluctuations. At the same time, in recent years, the domestic ecological and environmental protection supervision system has continued to improve, safety production supervision requirements have become increasingly strict, and labor costs and energy costs have increased. The pressure on compliance operations of small and medium-sized enterprises in the industry has continued to increase, which has forced industry enterprises to accelerate product structure optimization and core technology upgrades, and gradually transform towards the integration of high-tech barriers, high value-added specialty APIs, innovative drug intermediates and preparations. Against this background, industry production capacity and market share will gradually concentrate on leading companies with core technological advantages, a complete global compliance certification system, large-scale production capabilities and a full industry chain layout. The market concentration of my country's API industry is expected to show a long-term trend of continuous improvement, and the industry competition pattern will continue to be optimized.

(2) The issuer’s competitive advantages

Advantages of product diversification and coordinated development of multiple business sectors

Based on nucleoside (acid) APIs and pharmaceutical intermediates, the company has steadily expanded its three major business areas: functional food raw materials, non-nucleoside specialty APIs, and intermediate CMO/CDMO. It has formed a business structure of "solid core business and coordinated development of multiple sectors", with significant product diversification and full-field layout advantages.

In the field of nucleosides (acids), the company has built a complete product system from key pharmaceutical intermediates such as cytosine, 5-fluorocytosine, and hypoxanthine to end-use APIs such as citicoline, ribavirin, acyclovir, and azivudine. In the collaborative business sector, the company has achieved multi-scenario reuse and business complementarity of core technologies: in the field of functional food raw materials, it focuses on sports nutrition, cognitive health, weight management and other subdivisions. It has mastered the core preparation technology of creatine monohydrate, L-α-glycerophosphocholine, coenzyme Q10 and other products, while also focusing on citicoline (sodium), adenosine, D- The trend of extending the application of traditional nucleoside (acid) products such as ribose to the general health field has broadened the boundaries of product application; in the field of non-nucleoside specialty raw materials, a full-cycle gradient product pipeline of "small trial reserve-process development-registration review-marketing sales" has been constructed, and multiple varieties have been registered and commercialized; intermediate CMO/CDMO field, relying on core technology accumulation and industrialization capabilities in the field of nucleoside chemistry to provide customers with synthesis route optimization, quality research, customization

3-1-27

Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

Differentiated services such as manufacturing and production further extend the value of the industrial chain.

Advantages of vertically integrated industrial chain

Relying on years of industrial accumulation, the company has built a vertically integrated industrial chain of "basic raw material input - production of key pharmaceutical intermediates - preparation of terminal APIs". Most of its core products have full-process integrated production capabilities from pharmaceutical intermediates to APIs, forming a relatively prominent industrial chain synergy advantage.

At the supply chain and cost control level, the vertically integrated layout achieves independent and stable supply of core raw materials, effectively reduces comprehensive production costs, expands product profit margins, and reduces the impact of upstream basic raw material price fluctuations on the company's production and operations; at the quality control level, sufficient industrial chain extension is conducive to the company's implementation of full-process quality management from raw materials to finished products, improving product quality and batch stability, and meeting the industry development requirements of continued deepening of generic drug consistency evaluation and stricter drug life cycle supervision.

Advantages of technology research and development and industrialization transformation

Since its establishment, the company has always regarded R&D and innovation as its core development strategy, and has built a full-process R&D system that focuses on independent research and development and is supplemented by industry-university-research cooperation, forming core technical barriers to support the company's long-term development.

The company has established five core technology platforms: chemical synthesis, microbial fermentation, continuous flow catalysis, synthetic biology, and drug analysis, and established the "National Postdoctoral Research Workstation", "Henan Province Postdoctoral Research and Development Base", and "Henan University of Traditional Chinese Medicine-Tuoxin Pharmaceutical Innovative Drug School-Enterprise Joint Research and Development Center" "Henan Provincial Nucleoside Engineering Technology Research Center", "Henan Provincial Enterprise Technology Center" and other provincial-level and above R&D platforms have established a professional R&D team covering multi-disciplinary backgrounds such as synthetic chemistry, bioengineering, analytical testing, and process development. The subsidiary Drug Research Institute has obtained CNAS Laboratory accreditation provides complete hardware support and system guarantee for technology research and development and achievement transformation. Relying on continuous R&D investment and deep technological accumulation, the company has won major scientific and technological awards such as the second prize of the National Science and Technology Progress Award and the first prize of the Henan Province Science and Technology Progress Award. Many of its products have been selected as "National Key New Products" and "National Torch Plan Projects". As of the date of issuance of the sponsorship letter, the company has a total of 25 domestic invention patents, and 37 product production processes have been identified by relevant departments as domestic and foreign firsts, internationally leading, internationally advanced or domestically leading levels. At the same time, the company's core technology has mature industrial transformation capabilities and can quickly implement laboratory processes into large-scale production. Whether it is the process iteration of core nucleoside products or the large-scale mass production of new products such as creatine monohydrate, it has achieved effective transformation of technical achievements into business performance, providing core support for the company to continue to respond to market demand and optimize product structure.

3-1-28

Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

Compliance system and customer channel advantages

After more than 20 years of intensive industry development, the company has built a full-process compliance system covering mainstream domestic and foreign markets. With stable product quality, complete compliance control and efficient delivery capabilities, it has established long-term and stable cooperative relationships with many well-known pharmaceutical companies at home and abroad, forming relatively obvious customer channels and compliance barriers.

In terms of compliance system construction, in the domestic market, the company strictly follows the requirements of laws and regulations such as the "Drug Administration Law of the People's Republic of China" and "Measures for the Supervision and Administration of Drug Production". The production of raw materials is fully implemented under GMP management, and all core varieties have passed pharmaceutical GMP. Compliance inspection and related review and approval meet the regulatory access requirements of the domestic pharmaceutical industry; in overseas markets, the company actively promotes certification and registration in global mainstream markets. Multiple API varieties have passed certification in India, Indonesia, Bangladesh and other countries, many pharmaceutical intermediate products have passed certification in the EU, Japan and other countries and regions, and many functional food raw material products have passed cGMP, NSF173GMPDI and other certifications, and have the qualifications and capabilities to enter the global regulated market.

In terms of customer resources, the company has established long-term and stable cooperative relationships with well-known domestic and foreign pharmaceutical companies such as Sinopharm International Pharmaceutical Technology (Beijing) Co., Ltd., Chenxin Pharmaceutical Co., Ltd., China Resources Shuanghe Limin Pharmaceutical (Jinan) Co., Ltd., Qilu Pharmaceutical Group Co., Ltd., Kyowa Fermentation Biochemical Co., Ltd., and India's SolaraActive Pharma Sciences Limited, and has entered their qualified supplier system. Downstream pharmaceutical companies implement extremely strict qualified supplier access audits for suppliers of APIs and pharmaceutical intermediates. The certification cycle is long and the standards are high. Once the cooperative relationship is established, they have strong customer stickiness. The stable high-quality customer group not only brings sustained and stable operating income to the company, but also helps the company accurately grasp technological iterations and demand changes in the downstream industry, and achieve coordinated development with downstream customers.

Advantages of flexible manufacturing and large-scale delivery

The company has been deeply engaged in the industrial production of nucleoside (acid) products for more than 20 years. Focusing on the three core goals of quality improvement, cost control and environmental protection, the company has continuously optimized the production process, accumulated rich experience in large-scale production and process control, and built a flexible production system suitable for multi-category and multi-mode businesses, with significant manufacturing and delivery guarantee advantages.

In terms of the adaptability of the production model, the company has established a differentiated production management system: for raw materials and mature pharmaceutical intermediate products with high market demand, special workshops or collinear workshops are used for production, and production plans are formulated based on orders on hand and inventory status to ensure timely supply while achieving reasonable inventory management and control;

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Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

For pharmaceutical intermediates whose market demand fluctuates greatly, we use multi-functional workshops for production, which can flexibly complete the production switching of multi-category products to meet the diverse needs of customers; for intermediate CMO/CDMO business, we adopt a customized production model of "production based on sales", which can quickly respond to customers' personalized production needs. In terms of production capacity and cost control, the company is proficient in the production and control technology of dozens of reaction units, has industrial production capabilities for difficult special chemical reactions, and its core product production capacity ranks among the top in the industry. Compared with small and medium-sized enterprises in the industry, the company has significant economies of scale. Through continuous process optimization, the company has effectively improved product reaction yield and purity, reduced raw material unit consumption, and at the same time achieved a circular economy through the recycling and reuse of waste in the production process, further strengthening its cost control advantages.

Verification opinions on the issuer’s implementation of the “Guiding Opinions on Matters Concerning IPOs, Refinancing, and Major Asset Reorganizations that Dilute Current Returns”

After verification, the issuer has made a reasonable estimate of current return dilution based on objective assumptions based on its own operating conditions. At the same time, taking into account the unpredictability of the timing of this issuance and the possibility of future changes in the market competitive environment, the issuer has disclosed the necessity and rationality of this issuance, the relationship between the investment projects with funds raised this time and the issuer's existing business, and the issuer's personnel, technology, and market conditions in the investment projects. Reserves in the market and other aspects, practical measures to fill immediate returns have been formulated, and directors and senior managers have made corresponding commitments, in line with the "Opinions of the General Office of the State Council on Further Strengthening the Protection of the Legitimate Rights and Interests of Small and Medium-sized Investors in the Capital Market" (State Council [2013] 110 No.) on protecting the legitimate rights and interests of small and medium-sized investors.

6. Verification of related behaviors such as paid employment of third-party institutions and individuals

In accordance with the "Opinions on Strengthening the Prevention and Control of Risks of Securities Companies Engaging Third Parties and Other Integrity in Investment Banking Business" (CSRC Announcement [2018] No. 22) and other regulations, this sponsor conducts verification on the paid employment of various third-party institutions and individuals (hereinafter referred to as "third parties") in investment banking business and other related behaviors.

(1) Verification of the sponsor’s paid hiring of third parties and other related behaviors

This sponsor does not engage in any direct or indirect paid third-party behaviors in this sponsorship business, and there is no undisclosed hiring of third parties.

(2) Verification of the issuer’s paid hiring of third parties and other related behaviors

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Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

The issuer hired Zhongtai Securities as the sponsor of this project, hired Beijing Kangda Law Firm as the legal consultant of this project, and hired ShineWing Accounting Firm (Special General Partnership) as the audit agency of this project. The aforementioned intermediaries are all securities service agencies that are required to be hired by this project in accordance with the law and have issued relevant professional opinions or reports on this project.
In addition to the above-mentioned securities service agencies hired in accordance with the law, the issuer has directly or indirectly hired other third parties for a fee in this project. The specific circumstances are as follows: The issuer has hired Shangpu Consulting Group Co., Ltd. to provide feasibility analysis services for the investment projects raised by the funds raised in this issuance.

The issuer has directly or indirectly hired other third parties for a fee. The above-mentioned third parties all provide the issuer with services required in the issuance process of this project. It is necessary to hire other third parties. Their hiring behavior is legal and compliant, and complies with the relevant provisions of the "Opinions on Strengthening the Prevention and Control of Risks of Integrity in Engaging Third Parties and Other Integrity in Investment Banking Business by Securities Companies" (CSRC Announcement [2018] No. 22).

7. Recommendations from sponsors

The sponsor believes that: Tuoxin Pharmaceutical's issuance of shares to specific targets complies with the issuance conditions stipulated in the Company Law, Securities Law, Registration Management Measures and other relevant laws, regulations and documents; Tuoxin Pharmaceutical's issuance and listing application documents do not contain false records, misleading statements or major omissions; this issuance and listing complies with the issuance conditions, listing conditions and information disclosure requirements; the shares issued this time are qualified for listing on the GEM of the Shenzhen Stock Exchange. Zhongtai Securities agreed to recommend that the shares issued by Tuoxin Pharmaceutical to specific targets be listed and traded on the GEM of the Shenzhen Stock Exchange.

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Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter (This page has no text, it is the signature page of "Zhongtai Securities Co., Ltd.'s Sponsorship Letter for Tuoxin Pharmaceutical Group Co., Ltd.'s Issuance of Stocks to Specific Targets in 2026")

Project co-organizer:

Zhu Yinxin

Sponsor representative:

Li Zhibin Xu Baiqing

Head of Sponsorship Business Department:

Yan Peng

Kernel person in charge:

Zhan Xiaohua

Sponsorship business leader:

Zeng Liping

General Manager:

Feng Yidong

Chairman and legal representative:

Wang Hong

Zhongtai Securities Co., Ltd. Year Month Day

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Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter

Special authorization letter for the sponsor representative of Zhongtai Securities Co., Ltd.

China Securities Regulatory Commission, Shenzhen Stock Exchange:

In accordance with the "Measures for the Administration of Sponsorship Business of Securities Issuance and Listing" of the China Securities Regulatory Commission and relevant legal provisions, Zhongtai Securities Co., Ltd., as the sponsor of Tuoxin Pharmaceutical Group Co., Ltd.'s issuance of stocks to specific objects in 2026, authorized Li Zhibin and Xu Baiqing to serve as the sponsor representatives for this sponsorship work, specifically responsible for the sponsorship work and fulfilling the sponsorship responsibilities.

According to Shenzhen Stock Exchange’s “Shenzhen Stock Exchange’s Stock Issuance and Listing Review Business Guidelines No. 1—Acceptance of Application Documents”, this sponsor makes the following explanations and commitments regarding the above two signed sponsor representatives:

As of the date of issuance of this special authorization letter, apart from this project, Li Zhibin has no other initialization projects or refinancing projects under review; the sponsorship projects Li Zhibin has completed in the past three years include: Shandong Yanggu Huatai Chemical Co., Ltd. (300121.SZ, Yanggu Huatai) issuance of convertible corporate bonds to unspecified objects. This project will be completed in 2023 The issuance was completed in August 2018; Li Zhibin has not taken any other regulatory measures by the China Securities Regulatory Commission in the past three years, nor has he been publicly condemned by the stock exchange or self-disciplinary punishment by the Securities Association of China.

As of the date of issuance of this special authorization letter, except for this project, Xu Baiqing has no other initialization projects or refinancing projects under review; Xu Baiqing has not served as the signing sponsor representative for completed sponsorship projects in the past three years; Xu Baiqing has not taken other regulatory measures by the China Securities Regulatory Commission in the past three years, and has not been publicly condemned by the stock exchange or self-disciplinary sanctions by the Securities Association of China.

To sum up, as of the date of issuance of this special authorization letter, the relevant authorizations of Li Zhibin and Xu Baiqing are in compliance with relevant regulations such as the "Administrative Measures for the Sponsorship Business of Securities Issuance and Listing" and the "Shenzhen Stock Exchange Stock Issuance and Listing Review Business Guidelines No. 1 - Acceptance of Application Documents".

Hereby authorized.

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Tuoxin Pharmaceutical Group Co., Ltd. Securities Issuance Sponsorship Letter (This page has no text, it is the signature page of the "Special Authorization Letter for the Sponsor Representative of Zhongtai Securities Co., Ltd.")

Sponsor representative:

Li Zhibin Xu Baiqing

Legal representative:

Wang Hong

Zhongtai Securities Co., Ltd. Year Month Day

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