Introduction
Emmaus Medical, Inc. (Emmaus) is committed to the development and commercialization of innovative and cost-effective medications to treat rare diseases. Our commitment is driven by corporate values that focus on integrity, morality, mutual respect and professionalism.

Building trust among our customers and peers is critical to our success. Accordingly, it is important that we conduct our business with honesty and integrity and in compliance with all applicable legal and regulatory requirements. Our Corporate Code of Conduct (“Code of Conduct”) is a statement of our fundamental principles of business conduct and ethics. The Code of Conduct applies to all Emmaus employees, whether an entry-level employee, the CEO, or others who act on behalf of Emmaus. The Code of Conduct requires compliance with federal, state, and local laws and regulations wherever Emmaus conducts business.

In addition to its Code of Conduct, each Emmaus business sector adopted policies and procedures designed to implement the general principles articulated in the Code of Conduct. These are corporate policies governing a broad range of topics. Included in this broad set of policies are specific policies and procedures that address the major risk areas discussed in the OIG Compliance Program Guidance for Pharmaceutical Manufacturers published by the U.S. Department of Health and Human Services, Office of Inspector General in May 2003 (hereinafter “OIG Guidance”). Our written policies in this area are also consistent with the provisions of the Code on Interactions with Healthcare Professionals created by the Pharmaceutical Research and Manufacturers of America (“PhRMA Code”).

Recognizing that compliance is a fundamental value and key asset of the Company, Emmaus established a comprehensive healthcare compliance program that governs marketing, sales and medical information activities. Our Healthcare Compliance Program is consistent with the general principles of the OIG Guidance and the PhRMA Code. The OIG Guidance outlines seven elements that the OIG considers fundamental to establishing a comprehensive compliance program.

The fundamental elements of the Emmaus Healthcare Compliance Program as it relates to marketing, sales and medical information activities, are described below. As provided for in the OIG Guidance, our program is tailored to the unique environment of the Company. Compliance is a dynamic concept; Emmaus is committed to reviewing and enhancing its program, at least annually, to meet evolving compliance needs.

Written Policies and Procedures
The Emmaus Healthcare Compliance Program consists of written policies and procedures that provide requirements and restrictions on a range of activities by marketing, sales and medical affairs personnel to ensure that their activities meet legal requirements and high ethical standards. These policies, which are separate from and in addition to Emmaus corporate policies, apply to all employees when they are involved in the marketing or sale of pharmaceutical products.

Annual Spending Limit for California Healthcare Professionals
As part of its Healthcare Compliance Program, Emmaus adopted an annual spending limit for purposes of compliance with the requirements of California Health and Safety Code, Sections 119400-119402 (“California law”). Copies of this summary of the Emmaus Medical Healthcare Compliance Program may be obtained by contacting Emmaus at the following toll-free number: 877-420-6493. The Annual Declaration required by the California law is available on this page.

Emmaus established an annual spending limit of $1,000 on items covered by the California law that are provided to individual California healthcare professionals as part of the Company’s interactions with healthcare professionals to enhance the practice of medicine or benefit patient care. This dollar amount includes educational or practice-related items and meals associated with informational presentations or discussions, which Emmaus employees are permitted to provide to healthcare professionals under our Healthcare Compliance Program policies.

Emmaus’ annual spending limit does not include the following: 1) drug samples, 2) financial support for independent medical education programs, 3) fair market value payments for legitimate professional services to healthcare professionals including speaking, advising, consulting, training or market research services, 4) meals provided at advisory boards and speaker training, 5) research sponsorships, 6) reminder items of minimal value, 7) reprints, 8) printed advertising or promotional materials, and 9) items provided for distribution to patients.

The annual spending limit was communicated to employees in the Emmaus Sales & Marketing Section of the Company. Each employee is expected to manage these expenditures to comply with the annual limits. Emmaus is also working on a corporate monitoring process to capture these expenditures. Accordingly, Emmaus is unable at this time to ensure monitoring of every item provided as a gift to a small number of medical professionals such as non-prescribing formulary committee members or medical students who currently lack an Emmaus customer identification number.

Training and Education
An important component of the Healthcare Compliance Program is the training program that communicates the Company’s expectations concerning the ethical and legal obligation of Emmaus personnel. Our Code of Conduct and corporate policies and procedures are distributed to employees. The Compliance Officer oversees the content for the Code of Conduct and the Healthcare Compliance Program training and the process to ensure it remains relevant and current.

All Company personnel are required to complete annual Code of Conduct training. In addition, all Emmaus Sales & Marketing employees are required to complete training on the Healthcare Compliance Program as a condition of their employment. These employees also undergo periodic re-training and remedial training if needed. New field-based hires and existing field-based employees receive training, and undergo an assessment to ensure compliance with federal laws and regulations and with Emmaus Healthcare Compliance Program. After this initial training, periodic training of field-based employees is scheduled as needed on relevant policies. Field-based employees in geographies with state specific requirements also receive training specific to their state law requirements.

All headquarter employees engaged in marketing, sales and medical information activities receive training and undergo assessments. This training is designed to ensure compliance with federal and state laws, Emmaus Healthcare Compliance Program, and with the Company Code of Conduct. From time to time, more specific compliance training is provided as needed, to headquarter employees, that is consistent with their roles and responsibilities within the Company.

Reporting Mechanisms/Internal Lines of Communication
As part of our compliance culture, each employee is expected to ensure that Emmaus’ standards of conduct are met. It is expected that employees will seek compliance guidance from their managers when it is needed and that employees will report information concerning a good faith belief of possible misconduct.

Emmaus has a process that enables employees to report a good faith belief of suspected misconduct through e-mail or via a toll-free hotline that permits employees to report suspected misconduct in a confidential fashion. Company policies prohibit retaliation or retribution of any kind following the good faith reporting of a suspected violation.

Raising a concern under this policy will have no impact on any aspect of an employee’s employment. All employees will continue to be held to the performance and policy standards that generally apply to Emmaus employees. It is expected that employees will not use this policy for improper purposes such as attempting to avoid accountability for the performance and policy standards that generally apply to Emmaus employees.

Monitoring and Auditing
Consistent with its compliance commitment, Emmaus adopted monitoring and auditing processes to detect and investigate suspected breaches of our policies. Emmaus will take appropriate disciplinary action, including dismissal, where appropriate, when behavior inconsistent with the Company’s commitment to high ethical standards is detected.

The auditing plan is two-fold and includes assessments focused on specific risk areas to evaluate whether the Healthcare Compliance Program policies and procedures are being followed. In addition, an annual review of the Healthcare Compliance Program is conducted to evaluate internal risk, business practices, and new regulatory requirements.