California Compliance Declaration

Introduction

Committed to establishing and maintaining the highest standards of ethical practice, Beyond Air, Inc. (“Beyond Air” or the “company”) in conjunction with its Board of Directors and Senior Management, has created a Comprehensive Compliance Program (“Program”). For purposes of California Health and Safety Code § 119402, this Program constitutes the Beyond Air Comprehensive Compliance Program, which is designed in accordance with the Compliance Program Guidance published by the Office of Inspector General, U.S. Department of Health and Human Services (the “HHS-OIG Guidance”).

Purpose

The purpose of the Program is to prevent and detect any violations of law or company policy, which accords with California Health and Safety Code § 119402. Consistent with HHS-OIG Guidance, Beyond Air has tailored its business as a medical device manufacturer and implemented the Program to deal with any such violations. As the HHS-OIG Guidance recognizes, however, the implementation of such a program cannot guarantee that improper conduct will be entirely eliminated. Nonetheless, Beyond Air expects its directors, officers, employees, and agents (collectively referred to as “Beyond Air Representatives” for purposes of this document) to comply with its Code of Business Conduct and Ethics (the “Code”) and the policies established in support of the Code. The Code promotes ethical and professional behavior by Beyond Air Representatives. If Beyond Air becomes aware of potential violations of law or company policy, Beyond Air will, where appropriate, investigate the matter and take disciplinary action and implement corrective measures to prevent future violations.

Description

Beyond Air has provided below a description of its Program. Beyond Air regularly reviews and enhances its Program to meet its evolving compliance needs, the voluntary standards established by the HHS-OIG Guidance, and its unique environment and size of the company.

Overview of the Beyond Air Comprehensive Compliance Program

1.  Written Standards

The Code is the statement of ethical and compliance principles that guide daily operations at Beyond Air. The Code establishes that Beyond Air expects its Representatives to act in accordance with law and applicable company policy. The company’s fundamental principles, values, and framework are articulated throughout the Code for within its organization. The HHS-OIG Guidance has identified several potential risk areas for medical device manufacturers, and called on companies to develop compliance policies in these risk areas. As relevant to medical device manufacturers, these risk areas include: (i) accurate data  pertaining to government reimbursement practices and (ii) kickbacks and other illegal remuneration. Furthermore, a specific annual dollar limit has been imposed on gifts, promotional materials, or items or activities provided by Beyond Air to individual medical or health professionals licensed in California (“HCP”).

2. Leadership and Structure

The Beyond Air Compliance Committee (the “Committee”) shall be responsible for overseeing the Program. The Committee serves as the focal point for compliance activities; however, Beyond Air expects every Beyond Air Representative to operate with the professional and ethical responsibilities designated within the Code. Beyond Air is committed to ensuring that the Committee has the ability to effectuate change within the organization as necessary and to exercise independent judgment. To assist the Committee in providing effective leadership and oversight to the Program, Beyond Air has delegated certain of its responsibilities with appropriate oversight to executive and management officials. The Committee is a Board-designated committee that oversees the development and refinement of the Program and advises Beyond Air on its compliance obligations.

3. Education and Training

A critical element of our Program is the education and training of relevant personnel on their legal and ethical obligations under applicable federal healthcare program requirements. Beyond Air is committed to effectively communicating its standards and procedures to all affected personnel.

4. Internal Communication

Beyond Air is committed to fostering dialogue between management and Beyond Air Representatives. The company’s goal is that all Beyond Air Representatives, when seeking answers to questions or reporting potential instances of compliance violations, should know whom to turn to for a meaningful response. In order to further encourage open lines of communication regarding potential violations, we have established a toll-free phone line and web portal for anonymous reporting.

5. Auditing and Monitoring

The Beyond Air Program includes efforts to monitor and evaluate compliance with the company’s compliance policies and procedures. In accordance with the HHS-OIG Guidance, the nature of the company’s reviews, as well as the extent and frequency of its compliance monitoring and auditing, varies according to a variety of factors, including new regulatory requirements, changes in business practices, and other considerations.

6. Responding to Past and Potential Violations

Beyond Air requires a prompt and diligent response to potential violations of the company’s Program and the Code. Actions in response to detected problems may include improving policies, procedures, training, communications, and monitoring, and may require disciplinary action to prevent future violations.

7. Corrective Action Procedures

A compliance program increases the likelihood of preventing, or at least identifying unlawful and unethical behavior. However, HHS-OIG recognizes that even an effective compliance program may not prevent all violations. As such, the Beyond Air Program requires the company to respond promptly to potential violations of law or company policy, take appropriate disciplinary action, assess whether the violation is in part due to gaps in the company’s policies, practices, or internal controls, and take action to prevent future violations.

2023 Declaration of Compliance

Annually, for the period beginning January 1 and concluding December 31, Beyond Air set an annual aggregate limit on promotional expenditures provided at $3,000 per California HCP. The annual limit does not include: evaluation, replacement, or demonstration devices or equipment; financial support of continuing medical education forums; financial support for health education scholarships; education items that physicians give to their patients to enhance understanding or management of a disease state or disorder; fair market value compensation for bona fide professional services, and any meals or other expenses related to the provision of such services; training or educational programs and expenses (e.g., meals, flights, lodging) incurred deemed necessary for the safe and effective use and understanding of Beyond Air products; receptions at third party educational or professional meetings; items used to provide charity care; de minimis items of nominal value with a retail value of less than $10 (e.g., reprints of medical journal articles). Based upon our current internal monitoring process, to the best of our knowledge and belief, and based on a good faith understanding of California Health & Safety Code §§ 19400-402, Beyond Air is in compliance with all material respects with the requirements described in California SB1765. Beyond Air will continually evaluate and update its Compliance Program as necessary and appropriate.

Beyond Air makes this declaration available on this website and a copy of this document and/or Beyond Air’s Comprehensive Compliance Program may be obtained by accessing the Beyond Air Compliance Hotline.