Shanghai Pharmaceuticals Holding Co., Ltd. (SH Pharma, 02607 HK) has signed a new Procurement Framework Agreement with The Wing Fat Printing Company, Limited, an indirect non-wholly-owned subsidiary of Shanghai Industrial Holdings, on 29 October 2026. The one-year agreement, effective from 1 January 2027 to 31 December 2027, covers the supply of printed packaging materials for SH Pharma’s pharmaceutical products.

The annual transaction cap is set at RMB90.00 million, unchanged from the 2026 cap. Historical procurement from Wing Fat Group reached RMB58.58 million in 2025 and RMB44.51 million for the nine months ended 30 September 2026, underpinning the 2027 cap determination alongside anticipated demand.

Pricing for each individual order will be negotiated at arm’s length, referencing prevailing market prices, product specifications, order volume, task complexity and delivery schedules. Payment terms will be stipulated in separate individual agreements aligned with the overarching framework.

Because Wing Fat Printing is a connected person—stemming from its indirect ownership by Shanghai Industrial, whose controlling shareholder SIIC also controls SH Pharma—the arrangement is classified as a continuing connected transaction under Hong Kong Listing Rules. The highest applicable percentage ratio exceeds 0.1% but remains below 5%, triggering reporting, annual review and announcement requirements while exempting the deal from circular and independent shareholders’ approval obligations.

SH Pharma’s board, including independent non-executive directors, views the terms as fair, reasonable and in the company’s ordinary course of business. Chairman and connected director Mr Yang Qiuhua abstained from voting on the resolution; no other director was required to abstain.

Internal control measures include ongoing monitoring of pricing and transaction volumes by finance and relevant departments, with annual reviews by external auditors and independent non-executive directors to ensure compliance with agreed terms and the annual cap.

SH Pharma is a leading PRC-based integrated pharmaceutical company engaged in manufacturing and distribution. Wing Fat Printing, incorporated in Hong Kong, specialises in printing packaging materials and continues to support SH Pharma’s supply chain needs under the renewed framework agreement.