YiChang HEC ChangJiang Pharmaceutical : ANNOUNCEMENT STRATEGIC COOPERATION FRAMEWORK AGREEMENT

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

YiChang HEC ChangJiang Pharmaceutical Co., Ltd.

宜 昌 東 陽 光 長 江 藥 業 股 份 有 限 公 司

(A joint stock company incorporated in the People's Republic of China with limited liability)

(Stock Code: 01558)

ANNOUNCEMENT

STRATEGIC COOPERATION FRAMEWORK AGREEMENT

This announcement is made by YiChang HEC ChangJiang Pharmaceutical Co., Ltd. (the ''Company'', together with its subsidiaries, the ''Group'') pursuant to Rule 13.09 of the Rules Governing the Listing of Securities (the ''Listing Rules'') on The Stock Exchange of Hong Kong Limited (the ''Stock Exchange'') and the Inside Information Provisions under Part XIVA of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong).

The Company announced that, on 3 January 2020, the Company entered into a strategic cooperation framework agreement (the ''Strategic Cooperation Framework Agreement'') with China Resources Pharmaceutical Commercial Group Co., Ltd. (華潤醫藥商業集團有限 公司) (''CR Pharmaceutical Commercial'') whereby the Company and CR Pharmaceutical Commercial will jointly develop an internet platform dedicated to establishing online channels directly serving end-users and patients by leveraging on the distribution network and drug storage capability of CR Pharmaceutical Commercial, in order to enhance response to unexpected demand for the Company's core product, Kewei (oseltamivir phosphate) series, across China as well as to improve terminal coverage of other products. The Strategic Cooperation Framework Agreement is for a term of three years.

CR Pharmaceutical Commercial, a large medicine circulation enterprise in China, is a subsidiary and the primary profit centre of China Resources Group. CR Pharmaceutical Commercial is principally engaged in the sales of pharmaceutical merchandise, logistics distribution and provision of supply chain solution services, covering western medicine preparations, chemical active pharmaceutical ingredients, proprietary Chinese medicine, Chinese medicine decoction pieces, medical instruments, medical consumables, biopharmaceutical products and nutraceutical products, etc. As at the date of this announcement, to the best of the knowledge and belief of each of the directors of the Company and having made all reasonable enquiries, CR Pharmaceutical Commercial and its ultimate beneficial owners are third parties independent of the Company and its connected persons (as defined in the Listing Rules).

- 1 -

The Strategic Cooperation Framework Agreement is only a document of intention, which serves as a guidance document for the future long-term cooperation between the parties and as a basis for the relevant contracts to be entered into by the parties.

Shareholders and potential investors of the Company are advised to exercise caution when dealing in the shares of the Company.

On behalf of the Board

YiChang HEC ChangJiang Pharmaceutical Co., Ltd.

TANG Xinfa

Chairman

Hubei, the PRC

3 January 2020

As of the date of this announcement, the Board of the Company consists of Mr. JIANG Juncai, Mr. WANG Danjin, Mr. CHEN Yangui and Mr. LI Shuang as executive directors; Mr. TANG Xinfa and Mr. Eddy HUANG as non-executive directors; and Mr. TANG Jianxin, Mr. FU Hailiang and Mr. ZHAO Dayao as independent non-executive directors.

- 2 -