Darnitsa

cancelled

The proposed project is designed to support Darnitsa in financing of the modernisation and expansion of the existing manufacturing facilities as well as adding new product lines. The transition impact and demonstration effects associated with this potential investment are expected to include: Darnitsa is one of the leading pharmaceutical producers in Ukraine. The Bank will provide a loan to Darnitsa of EUR 25 million. EUR 44.4 million. Environmental classification and rationale The project is Categorised B. Operation of the pharmaceutical production is associated with a number of site specific issues, which can be readily identified, assessed and mitigated through measures as defined in the Environmental and Social Action Plan. Due diligence completed Environmental and social due diligence (ESDD) has been undertaken by the Bank’s Environment and Sustainability Department based on the review of all available information, including site visit, review of corporate management systems and interviews with the Company’s representatives. Key environmental issues and mitigation The Company’s operations carry a low degree of environmental and social risk. Due diligence identified a need to document management systems procedures at the Corporate level and additionally identified a number of waste management, contractor management and emergency response issues which require to be addressed in order that the Company can operate to the standards of the Performance Requirements (PRs). These issues require mitigation actions to address not only operational risk but also the risks posed by the construction and fitting-out activities which are part of the Project going forward. Summary of Environmental Action Plan An Environmental and Social Action Plan (ESAP) has been developed and agreed with the Company to address some areas for improvement identified during the ESDD and carry out the necessary mitigation measures which will enable the Company to comply with national regulations and the Bank’s PRs. Since the beginning of the ESDD, the Company has already started implementation of some ESAP requirements and has already improved its EHS management system. Disclosure of information and consultation The Company will also disclose locally information on its environmental and social performance. Monitoring and reporting The Company will monitor the environmental impact of its operations in accordance with national law and regulations. The Bank will evaluate the project's compliance with the applicable environmental and social requirements during the lifetime of the project by reviewing annual environmental reports prepared for the project covering: (i) ongoing performance of project-specific environmental, health and safety activities as reflected in the results of periodic and quantitative sampling and measuring programmes, and (ii) the status of implementation of environmental mitigation and improvement measures. The Bank’s representatives will also conduct periodic site supervision visits when deemed appropriate. None. Mikhail Chupryna Head of Corporate Finance Tel. +38 044 207 73 48 E-mail: mc@darnitsa.kiev.ua