Code of Conduct & Anti-Corruption Policy

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POLICY OVERVIEW

This Anti-Bribery, Anti-Corruption, and Ethics Policy (the “Policy”) forms an integral part of Scandens Pharmaceutical Industries Ltd. LL’s (the “Company”) commitment to conducting business ethically, lawfully, and with integrity across all operations and jurisdictions.

This Policy shall be read in conjunction with the Company’s Code of Conduct and outlines expectations in the following areas:

• The Company strictly prohibits bribery in all forms, whether in the public sector or for commercial purposes.
• Clear guidelines are provided on the acceptable conduct regarding gifts, meals, travel, and entertainment, particularly in dealings with officials, customers, suppliers, and other third parties.
• The importance of maintaining accurate records for all Company transactions is emphasized, ensuring transparency and accountability.
• Ethical principles governing all business activities, including respect for intellectual property, fair competition, and truthful communication.

This Policy applies to all employees, officers, directors, contractors, agents, and third parties working on behalf of the Company, whether directly or indirectly, worldwide. It applies to all interactions, both within and outside the organization, including interactions with government officials, private companies, and other stakeholders.

I. DEFINITIONS

For the purposes of this Policy, the terms “officials,” “bribery,” “a valuable benefit,” and “incentive payment” are defined below.

“Officials”

Officials are individuals holding specific positions or authority as outlined in the legislation of the Republic of Azerbaijan, including but not limited to:

• Persons elected or appointed to state bodies in accordance with the Constitution and laws of the Republic of Azerbaijan;
• Representatives of state bodies acting on the basis of special authority;
• Civil servants in administrative positions;
• Individuals holding organizational or administrative-economic functions in state bodies, enterprises, and organizations with significant state ownership;
• Candidates registered for elective positions in state bodies;
• Local self-government officials and those with similar administrative responsibilities;
• Heads and employees of anti-corruption institutions or those performing similar roles in state-authorized institutions;
• Persons working in non-state entities exercising the powers of state bodies as designated by law.

"Bribery"

Bribery refers to the offering, promise, or provision of a material or non-material benefit, privilege, or concession to an official, either directly or indirectly, for personal gain or for the benefit of third parties. This is done in exchange for an official act, for refraining from an official duty, or for performing an action related to their official responsibilities.

“Valuable Benefit”

A valuable benefit can include cash, gift cards, checks, gifts, hospitality, meals, goods, services or souvenirs, tickets to any event, retail certificates, entertainment, travel, use of vacation properties, educational or employment opportunities for family members, stock options, charitable donations, discounts, personal services, loans, co-signing of loans, or the promise of future employment.

“Incentive Payment”

An incentive payment refers to any payment made to an official to expedite services such as processing applications for permits, visas, and licenses, or providing public services like police protection, utilities (water, electricity, etc.), postal services, and similar. The Company strictly prohibits incentive payments, as they are illegal and unethical.

II. BRIBE AND INCENTIVE PAYMENTS

No employee of the Company is permitted to pay or offer bribes or incentive payments. While incentive payments may be considered legal in certain jurisdictions, the Company strictly prohibits them and considers such actions a violation of this Policy. Therefore, any reference to the term “bribe” within this Policy also includes the term “incentive payment.” If any employee encounters a request for a bribe, they must refuse to comply (except in circumstances where refusal may result in an immediate threat to their safety, as detailed below) and immediately report the request to the designated legal counsel or any other individual designated to receive such information. In cases where an employee believes that refusing to make a payment would endanger their safety or health, they may proceed with the payment. However, the payment and the circumstances surrounding it must be reported to the designated legal counsel or another designated individual as soon as the danger has passed. All such payments must be recorded accurately, in accordance with the procedures outlined in Section 5 below.

III. BRIBERY RISKS RELATED TO THIRD PARTIES

For the purposes of this Policy, a third party is any legal or natural person engaged by a Company employee to act on behalf of the Company. This includes, but is not limited to, suppliers, vendors, agents, consultants, service providers, and distributors who purchase products from the Company and sell them to end users.

The Company may be held liable for the actions of third parties who offer or give bribes to officials. As such, this Policy explicitly prohibits the Company from offering bribes through third parties. It is also a violation of this Policy to disregard warnings or red flags that suggest a third party’s actions may result in the offering or giving of a bribe.

Employees engaging third parties to interact with government officials or other entities on behalf of the Company must exercise due diligence and ensure that the third parties comply with all relevant anti-bribery laws and Company policies. This includes assessing the integrity of third parties, conducting thorough background checks, and monitoring their activities.

The Company does not make donations, whether in cash or kind, in support of any political parties or candidates, as this can be perceived as an attempt to gain an improper business advantage.

IV. GIFTS, MEALS, TRAVEL, AND ENTERTAINMENT

It is not permitted to provide valuable benefits, including, but not limited to gifts, meals, travel, and entertainment to officials or customers, suppliers, or other third parties with the intention of improperly influencing them.

Additionally, the offering or acceptance of cash gifts or gifts such as gift cards that can be converted into cash is strictly prohibited.

Charitable support and donations are acceptable (and indeed are encouraged), whether of in-kind services, knowledge, time, or direct financial contributions. However, employees must be careful to ensure that charitable contributions are not used as a scheme to conceal bribery. The Company only makes charitable donations that are legal and ethical under local laws and practices. No donation must be offered or made without the prior approval of the CEO. All charitable contributions should be publicly disclosed.

Customers, Suppliers, and Other Third Parties

Since gifts or hospitality provided to or received from a third party may be considered as a material or other benefit, they have the potential to be construed as bribery. Prior to offering or accepting any gift or hospitality, the following minimum requirements must be met:

• It must be given in good faith, with no expectation of reciprocation or the receipt of an improper benefit or business advantage;
• It must be provided in a reasonable and generally accepted manner, consistent with recognized standards of professional courtesy;
• It must be presented transparently and openly;
• It must be given infrequently and should not encourage unethical behavior;
• It must comply with applicable local laws and regulations.

Officials

Under this Policy, Company employees are generally prohibited from offering material or other benefits, including gifts and entertainment, to officials, as such actions may violate local anti-bribery laws. However, there are certain exceptions:

• Small, modest gifts and simple entertainment may be provided to officials, provided they are not related to the official’s duties or responsibilities and do not exceed the maximum amount permitted by the legislation of the Republic of Azerbaijan within a one-year period.
• These gifts or entertainment must be subject to prior written approval from the designated legal counsel or another authorized person within the Company.

Documentation of Compensation

When seeking reimbursement for any gifts, meals, travel, or entertainment provided to officials, Company employees must submit the official’s name, position, and government affiliation, as well as the purpose of the expense, and provide receipts for the expenses, regardless of their value. All documentation must be submitted in compliance with the Company’s procedures for expense reporting and reimbursement.

V. RESPONSIBILITIES

• All Employees are responsible for complying with the Policy and for promptly and in good faith reporting any suspected violations.
• Managers are required to promote ethical behavior within their teams and to ensure that any gifts or hospitality provided or received are approved in accordance with this Policy.
• Compliance/Legal is responsible for investigating reported concerns, overseeing Policy implementation, monitoring overall adherence, and reviewing and updating the Policy annually.
• The HR Department is tasked with integrating ethics and anti-bribery training into onboarding procedures and ensuring all employees receive regular refresher training.

VI. ACCURATE ACCOUNTING AND RECORDS

Most anti-bribery laws require the maintenance of accurate accounting records and the establishment of appropriate internal controls to prevent the concealment of improper payments, among other risks. The Company is committed to ensuring that all financial records and accounting books are fair, accurate, and complete, reflecting the true nature of all business transactions. These records must provide a clear and transparent understanding of the transaction and include sufficient detail to facilitate a full understanding.

Transactions must only be executed with proper approval from management, and all records should be prepared in a transparent and honest manner to enable accurate financial reporting. Employees are expected to comply with the accounting and record-keeping standards that apply to their roles and responsibilities, ensuring that all transactions are documented appropriately in accordance with Company Policy and applicable regulations.

VII. REPORTING SUSPECTED VIOLATIONS

All employees of the Company are obligated to report any suspected violations of this Policy or any anti-bribery laws. Any concerns regarding potential misconduct or breaches should be immediately reported to the designated legal counsel or another individual designated to receive such reports.

The Company’s Code of Conduct expressly prohibits retaliation against any individual who reports a violation in good faith. Employees are encouraged to report concerns without fear of retaliation, and the Company is committed to protecting those who raise legitimate concerns.

VIII. TRAINING AND COMMUNICATION

Training on this Policy forms part of the induction process for all new employees. All existing employees will receive regular, relevant training on how to implement and adhere to this Policy. In addition, all employees will be asked to formally accept conformance to this Policy on an annual basis. Zero-tolerance approach to bribery and corruption must be communicated to all suppliers, contractors, and business partners at the outset of our business relationship with them and as appropriate thereafter.

IX. MONITORING AND DISCIPLINARY ACTIONS FOR POLICY VIOLATIONS

The HR has primary and day-to-day responsibility for implementing this Policy, and for monitoring its use and effectiveness and dealing with any queries on its interpretation. Management at all levels are responsible for ensuring those reporting to them are made aware of and understand this Policy and are given adequate and regular training on it.

The HR will monitor the effectiveness and review the implementation of this Policy, regularly considering its suitability, adequacy and effectiveness. Any improvements identified will be made as soon as possible. Internal control systems and procedures will be subject to regular audits to provide assurance that they are effective in countering bribery and corruption. All employees are responsible for the success of this Policy and should ensure they use it to disclose any suspected danger or wrongdoing. Employees are invited to comment on this Policy and suggest ways in which it might be improved. Comments, suggestions, and queries should be addressed to the HR. This Policy does not form part of any employee's contract of employment, and it may be amended at any time.

Any employee found to have violated this Policy may face disciplinary action, which may include termination of employment, depending on the severity of the violation and compliance with the labor law of the Republic of Azerbaijan. The Company will investigate any alleged breach of this Policy thoroughly and ensure that appropriate actions are taken to uphold its standards of integrity and compliance. This Policy adheres to the anti-corruption legislation of the Republic of Azerbaijan and is aligned with international compliance standards.

This Policy will be reviewed annually by the CEO and approved by senior management. Updates may be made in response to legal, regulatory, or operational changes.

X. ETHICAL BUSINESS CONDUCT STANDARDS

The Company upholds a strong ethical framework that governs all aspects of its operations. The following principles form the foundation of our corporate ethics:

Integrity and Transparency

Employees must act honestly and transparently in all business dealings, providing accurate and complete information to regulators, customers, partners, and stakeholders. Misleading practices, false claims, or fraudulent conduct are not tolerated.

Respect for Intellectual Property and Fair Competition

The Company respects the intellectual property rights of third parties and expects reciprocal respect. Employees must safeguard the Company’s proprietary technologies and data, and avoid any act that could constitute unfair competition or IP infringement.

Human Rights and Labor Standards

All individuals must be treated with dignity and fairness. The Company prohibits discrimination, harassment, child labor, and forced labor. The workplace must remain inclusive, respectful, and compliant with labor laws.

Environmental Responsibility

Employees are expected to act responsibly with regard to environmental practices, ensuring compliance with all applicable regulations and striving to minimize the Company’s ecological footprint.

Confidentiality and Data Protection

Confidential information, including personal data and business secrets, must be handled with care, protected from unauthorized access, and used only for legitimate business purposes in line with the laws of the Republic of Azerbaijan.

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INTRODUCTION

Scandens Pharmaceutical Industries Ltd LLC (hereinafter referred to as “Scandens” or “Company”) is committed to delivering safe, effective, and high-quality healthcare products. Our company adheres to industry regulations to ensure the safety and efficacy of our products.

The Code of Conduct (hereinafter referred to as “Code”) outlines our expectations for behavior, responsibilities, and best practices for all employees, partners, contractors, and stakeholders involved in our operations.

COMPLIANCE WITH REGULATORY STANDARDS

Our activities must meet all applicable laws, guidelines, and regulatory requirements in the countries where Scandens operates, ensuring the safety, efficacy, and quality of our products.

Scandens prioritizes quality in all aspects, ensuring that our medicines and other healthcare-related products meet the highest standards of safety and effectiveness for patients worldwide.

HEALTH, SAFETY, AND ENVIRONMENTAL STEWARDSHIP

Scandens is committed to maintaining a safe and healthy working environment for all employees by strictly adhering to occupational health and safety regulations, providing regular training in safety procedures, and implementing proactive measures to prevent workplace accidents and injuries.

In terms of environmental responsibility, Scandens aims to minimize our environmental footprint by following sustainable development practices. The Company's policies focus on reducing waste and energy consumption, ensuring the responsible disposal of chemicals and other hazardous materials, and complying with all environmental regulations. Scandens actively works towards reducing pollution and improving environmental outcomes. Scandens complies with applicable environmental laws and regulations and discloses our environmental efforts in accordance with applicable Company policies and procedures.

PROTECTING CONFIDENTIAL INFORMATION

As employees and partners of Scandens, we are entrusted with sensitive and confidential information, including that of our clients, business partners, suppliers, and proprietary company data.

It is our responsibility to safeguard all confidential and proprietary information related to Scandens and our partners, whether it pertains to product formulations, business strategies, or any other sensitive data. Disclosure of such information is strictly prohibited unless authorized by Scandens, required by applicable laws and regulations, or necessary for compliance with industry standards and guidelines.

SOCIAL MEDIA CONDUCT

Sharing sensitive Company materials, such as standard operating procedures, customer databases, internal communications, financial records, business strategies, pricing structures, project documentation, employee data, legal documents, or proprietary software and tools, is strictly prohibited. Additionally, employees and partners must refrain from any online activity or behavior that could potentially harm Scandens’ reputation. Social media engagement should reflect the professionalism and values of the organization at all times. The use of Scandens’ logos, trademarks, or branding on personal profiles is not allowed unless expressly permitted.

Any instances of inappropriate use of social media or behavior that could negatively affect the Company’s image should be promptly reported to management or the compliance team.

PROFESSIONAL AND ETHICAL BEHAVIOR DURING ONLINE MEETINGS

Professional standards must be maintained during all virtual meetings, just as in face-to-face interactions. Cameras and microphones should be used appropriately, and participants are expected to follow the Company’s cultural and conduct guidelines throughout. Backgrounds must be suitable for a professional environment, and personal appearance should reflect Scandens' standards of professionalism.

Participants are expected to join meetings on time, be well-prepared, and avoid multitasking during discussions. All efforts should be made to minimize background noise and other distractions to ensure a productive environment. Meetings may involve confidential information; therefore, recording or sharing content without prior authorization is strictly prohibited. Respectful and inclusive communication is expected at all times, with active listening and thoughtful contributions encouraged.

EMAIL COMMUNICATION AND CORRESPONDENCE STANDARDS

All email correspondence must reflect the Company’s communication standards and corporate culture. Employees should carefully review recipient lists before sending messages and exercise caution when attaching and sharing files. Miscommunication or accidental data sharing due to oversight must be avoided.

Employees must ensure that all relevant individuals who are directly involved or affected by the topic of the email are appropriately included in the To or CC fields.

INFORMATION TECHNOLOGY SECURITY

To ensure the integrity and security of Scandens’ systems and data, the use of unauthorized or unnecessary software is strictly prohibited. Access to internal servers, databases, and systems is restricted to authorized personnel only. Employees are responsible for safeguarding their login credentials, including passwords for devices and corporate email accounts. These credentials must not be shared with any third parties under any circumstances.

RESPECT IN THE WORKPLACE

All employees should respect their colleagues. Scandens will not allow any kind of discriminatory behavior, harassment, or victimization. Employees shall be given equal opportunities in all aspects of their work, from recruitment and performance evaluation to interpersonal relations.

Scandens prohibits unlawful discrimination based on any characteristic protected by applicable law. These characteristics may include age, color, disability, employment status, ethnic origin, gender identity or expression, marital status, nationality, race, religion or belief, sex, sexual orientation, as determined by local legal standards. These principles of anti-harassment and antidiscrimination extend to our relationships with business partners. Scandens never uses discriminatory criteria in the selection or termination of business partners, nor unlawfully harass or discriminate against individuals who work for our business partners.

WHO SCANDENS WORKS FOR

Scandens serves and collaborates with:

• Patients and Healthcare Providers
• Regulatory Bodies
• Business Partners
• Suppliers and Contractors

CONFLICT OF INTEREST

All employees, managers, and partners of Scandens must avoid any situation where their personal, financial, or family interests conflict, or appear to conflict, with the interests of the Company. A conflict of interest may arise when an individual’s private interests interfere with their responsibilities to Scandens or compromise their ability to make impartial business decisions in the best interests of the Company.

Situations that may give rise to a conflict of interest include, but are not limited to, outside employment or consulting arrangements, personal or family relationships with competitors, suppliers, or clients, and financial interests in companies that do business with or compete against Scandens.

To ensure ongoing compliance, every employee and manager is required to complete and sign a Conflict of Interest Disclosure Form on a yearly basis.

Failure to disclose a conflict of interest may result in disciplinary action, up to and including termination of employment or contractual engagement.

TRAINING AND AWARENESS

All employees must complete the Code of Conduct and compliance training on a yearly basis. This ensures continued awareness of ethical and regulatory responsibilities. Managers are responsible for ensuring that their team members understand and follow this Code and must lead by example, promoting a culture of integrity and accountability.

REPORTING CONCERNS

All employees, contractors, and stakeholders are encouraged to report any suspected violations of this Code, breaches of law, or unethical behavior.

Concerns may be reported through the following channels:

• Line managers or supervisors, for general operational concerns
• Human Resources Department, for issues related to harassment or workplace behavior
• Compliance Officer or, where not appointed, a designated senior member of management, for regulatory or legal issues

Reports may be submitted:

• In person
• Via email to: [email protected] (monitored exclusively by the designated compliance lead)
• Using a physical drop-box, where applicable (collected weekly by the compliance team)

Scandens strictly prohibits retaliation against any individual who reports a concern in good faith. All reports will be investigated promptly, fairly, and with strict confidentiality.

ENFORCEMENT AND DISCIPLINARY ACTION

Violations of this Code may result in disciplinary action, including but not limited to verbal or written warnings, suspension, termination of employment, or legal proceedings. Every case will be evaluated fairly, and employees will have an opportunity to explain their actions before any decision is made.

COMPLIANCE WITH THE CODE

All employees and partners are expected to adhere to this Code. Violations should be reported to the compliance officer or through appropriate channels. Employees are encouraged to report concerns without fear of retaliation, and the Company is committed to protecting those who raise legitimate concerns.