An Open Letter from Sinobioway Consortium to All Shareholders of Sinovac Biotech Ltd.

Unfortunately, acting in violation of law and against the best interests of the Company, the Mr. Yin Weidong (former CEO), Ms. Wang Nan (former CFO) and Former Directors have not only refused to hand over control of the Company, but also have continued to take self-interested actions to line their own pockets and entrench their illegitimate position at the expense of the Company and its shareholders.

Mr. Weidong Yin, the Chairman of Former Board, Committed Bribery from 2002 to 2014

From 2002 to 2014, Mr. Yin, acting on behalf of the Company, bribed Mr. Hongzhang Yin, the then-vice director of the Center for Drug Evaluation (“CDE”) of the China Food and Drug Administration, and his wife on multiple occasions.Mr. Yin admitted the above illegal conduct to the PRC law enforcement agencies, as disclosed in the two written judgments issued by Beijing No.1 Intermediate People’s Court --the Criminal Judgment on Guo’s Acceptance of Bribes and the Criminal Judgment on Hongzhang Yin’s Acceptance of Bribes, respectively.

Mr. Yin’s illegal conduct no only violates the PRC Criminal Law, for which he can be convicted and imprisoned for a term of up to ten years, but is also a clear violation of the U.S. Foreign Corrupt Practices Act, and a violation of both SEC and NASDAQ regulations and is a grave and actionable offense for SEC registered companies like Sinovac.

Despite of the seriousness of Mr. Yin’s illegal conduct, the Former Board did not take any action to remove Mr. Yin from the board nor take any other measures against Mr. Yin to protect the legitimate rights and interests of the Company and its shareholders from this criminal behavior. Surprisingly, the Former Board re-nominated Mr. Yin to continue to serve on the board.

The Former Directors Issued and Sold Shares to the Members of the Management Consortium (Mr. Yin Weidong, Advantech, C-Bridge Capital, SAIF, VIVO Capital) at a Price Lower than Sinobioway’s Offered Price

The Sinobioway Consortium has explicitly, publicly and repeatedly offered $8.00 per share to acquire all common shares of the Company since June 28, 2017. In fact, the reason that the illegal actions that the Former Directors and Management have taken stems largely from their fear that the Sinobioway Consortium’s offer represents compelling value to the Company’s shareholders over the managed consortium’s offer. In light of this higher offer from the Sinobioway Consortium, the Former Directors nevertheless tried to buyout the company at $7.0 per share even after they were voted out by shareholders on Feb 6^th, 2018. On July 2^nd, Mr. Yin Weidong and the former boards announced termination of his buyout agreement at $7.0 per share, yet in the same press release and at the same time, issued and sold 11,800,000 common shares of Sinovac at a price of $7.35 per share, to two members of the management consortium led by Mr. Weidong Yin. This transaction immediately caused all unaffiliated shareholders substantial direct and indirect losses at least in tens of millions. Such self-dealing fraudulent transaction of company shares is in essence a new approach by Mr. Yin Weidong’s buyout consortium to acquire the company at a discount.

Mr. Yin Weidong, Wang Nan and The Former Directors Issued a Large Number of Share Incentives to Themselves

According to the Company’s 2017 annual report, the Former Directors issued a large number of restricted shares to themselves on March 7, 2018. In particular, Mr. Weidong Yin, one of the Former Directors who was previously implicated of bribing a Chinese government official, received 160,000 restricted shares, and Ms. Nan Wang, the Company’s CFO who together with Mr. Yin is responsible for the late filing of the Company’s 2016 annual report, also received 160,000 restricted shares. Given that the closing price of Sinovac’s stock on March 7, 2018, was $8.25, the Former Directors dishonestly and unlawfully awarded Mr. Weidong Yin and Ms. Nan Wang a total of 320,000 restricted shares with a cash value of US$2.64 million—despite Mr. Yin’s illegal conduct and Ms. Wang’s poor performance as CFO. Both Mr. Yin and Ms Wang Nan have been worked, not for the shareholders, but for the Management Consortium (Mr. Yin, Advantech, C-Bridge Capital, SAIF, VIVO Capital) as Mr. Yin and Ms. wang would receive 10% of the company as an incentive if they could help the Consortium to buyout the company at a discount of $7.0 per share.

Sinobioway as the founding shareholders of Sinovac Beijing has Veto Powers against Beijing Sinovac’s Daily Operation and Key Corporate Governance Matters and has the Right to Appoint the Chairman and Legal Representative of Beijing Sinovac

Sinovac Biotech Co., Ltd. (“Beijing Sinovac”) is the principal operating subsidiary of Sinovac, of which Sinobioway Biomedicine Co., Ltd. (a.k.a PKU V-Ming, “Sinobioway”) is the key shareholder. Nevertheless, Sinobioway has retained significant powers under the Articles of Association of Beijing Sinovac. These powers remain vested in Sinobioway and cannot be taken away under Chinese law, which include, among others, the right to appoint the legal representative of Beijing Sinovac and appoint chairman of the board and additional two directors to the five-director board of Beijing Sinovac as the chairman of the board. Accordingly, Sinobioway has the ability to take actions that block any action that requires unanimous board approval. The Articles of Association of Beijing Sinovac require the consent of each of its shareholders and/or unanimous board approval on matters such as a major change in the business line of the company, expansion or amendment of the business scope of the company, transfer of the registered capital by a shareholder, creation of a mortgage or pledge upon the company’s assets, a change in the organizational form of the company and designation, or removal of the general manager. As such, Sinobioway’s veto powers play vital role in Beijing Sinovac’s daily operation and its corporate governance matters.

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