EBS Emergent Biosolutions Inc.

77.35
-1.23  -2%
Previous Close 78.58
Open 77.47
52 Week Low 60.46
52 Week High 137.61
Market Cap $4,122,755,000
Shares 53,300,000
Float 38,295,487
Enterprise Value $4,441,814,000
Volume 979,911
Av. Daily Volume 718,219
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Drug Pipeline

Drug Stage Notes
COVID-EIG
COVID-19
Phase 2
Phase 2
Phase 2 trial planned.
COVID-HIG
COVID-19
Phase 3
Phase 3
Phase 3 initiation announced October 8, 2020.
CHIKV-VLP
Chikungunya virus
Phase 2
Phase 2
Phase 3 trial to be initiated in 2021.
FLU-IGIV
Influenza A
Phase 2
Phase 2
Phase 3 trial to commence in 2020.
VLA1601
Zika vaccine
Phase 1
Phase 1
Phase 1 data released November 19, 2018 - primary endpoint met with favorable safety profile.
BioThrax
Anthrax Vaccine Adsorbed
Approved
Approved
Approved November 24, 2015.
Anthrax Immune Globulin Intravenous (Human) [AIGIV]
Anthrax
Approved
Approved
Approved March 25, 2015.
BioThrax
Anthrax Vaccine
Approved
Approved
Approved May 17, 2012.

Latest News

  1. Entwistle & Cappucci LLP ("Entwistle & Cappucci") is investigating potential federal securities law violations on behalf of clients that invested in Emergent BioSolutions Inc. ("Emergent" or the "Company") (NYSE:EBS) based on: (i) the Company's contamination of at least 15 million doses of the Johnson & Johnson COVID-19 vaccine; (ii) Emergent's failure to fix known manufacturing quality issues identified by federal regulators and internal audits; (iii) the Company's repeated misstatements concerning its quality control, manufacturing process, compliance with applicable regulations and delivery schedule of the Johnson & Johnson vaccine; and (iv) the U.S. Department of Health & Human Services' ("HHS") resulting announcement that it was directing…

    Entwistle & Cappucci LLP ("Entwistle & Cappucci") is investigating potential federal securities law violations on behalf of clients that invested in Emergent BioSolutions Inc. ("Emergent" or the "Company") (NYSE:EBS) based on: (i) the Company's contamination of at least 15 million doses of the Johnson & Johnson COVID-19 vaccine; (ii) Emergent's failure to fix known manufacturing quality issues identified by federal regulators and internal audits; (iii) the Company's repeated misstatements concerning its quality control, manufacturing process, compliance with applicable regulations and delivery schedule of the Johnson & Johnson vaccine; and (iv) the U.S. Department of Health & Human Services' ("HHS") resulting announcement that it was directing Johnson & Johnson to assume full responsibility for manufacturing its vaccine on a going-forward basis.

    Emergent is a biopharmaceutical manufacturing company headquartered in Maryland. For years prior to the pandemic, Emergent generated hundreds of millions of dollars in revenue from lucrative contracts with the U.S. government to manufacture anthrax vaccines for the national stockpile. In April 2020, as part of the national COVID-19 vaccine program, Operation Warp Speed, Johnson & Johnson and the federal government contracted with Emergent for the production of Johnson & Johnson's vaccine using hundreds of millions of dollars in taxpayer funds. Several months later, on July 27, 2020, Emergent announced the Company had signed an agreement to provide development and manufacturing services for AstraZeneca's COVID-19 vaccine. The contract was valuated at $174 million through 2021.

    To date, Emergent's Baltimore facility has produced approximately 150 million doses of the COVID-19 vaccines, but the doses are currently unusable due to long-standing quality control issues identified by the U.S. Food and Drug Administration ("FDA"). Reports on April 1, 2021 disclosed several production lots, including up to 15 million doses of the Johnson & Johnson vaccine, have been discarded due to potential cross-contamination and other FDA compliance issues.

    Entwistle & Cappucci's investigation to date has revealed:

    • Just two weeks before Emergent executed its contract to produce Johnson & Johnson's vaccine, an inspection by the FDA revealed the Company had "deficient" containment areas for holding rejected manufacturing components to prevent cross-contamination and employees were "not given training in the particular operations they perform as part of their function and good manufacturing practices;"
    • Emergent has a history of alleged manufacturing problems. For example, in 2019, one of Emergent's partners, Soligenix, Inc., revealed in a securities filing that Emergent supplied it with drugs that were out of specification and participants in a study had already been given doses before Emergent caught the error;
    • FDA inspectors have been critical of Emergent since at least December 2017, when inspectors found uncorrected problems with mold in the Company's Canton, Massachusetts manufacturing facility. In 2018, FDA inspectors found Emergent had a policy of not conducting routine compliance audits at multiple manufacturing facilities;
    • Audits conducted by Johnson & Johnson, AstraZeneca and federal agencies during 2020 revealed significant issues at Emergent's Baltimore facility, including: (i) risks of viral cross-contamination, (ii) inadequate disinfectant equipment, (iii) improper testing of raw materials and (iv) inadequate training of employees. Federal regulators also determined that Emergent failed to properly follow-up on audit findings; and
    • Officials at Operation Warp Speed and HHS received a government report in June 2020 that concluded the Company's vaccine manufacturing plan was inadequate and Emergent's problems hiring and retaining skilled workers meant it could not guarantee success in producing doses.

    Despite these issues, Emergent and its senior executives made a series of allegedly false and misleading statements to investors, including:

    • During Emergent's July 30, 2020 earnings call held to discuss second quarter financial results, the Company's Chief Executive Officer Robert Kramer boasted about the Company's drug manufacturing capabilities and industry expertise, stating the Company's "ability to manufacture on a large scale has positioned us to contribute to the COVID-19 pandemic response like no other organization;"
    • On November 5, 2020, Senior Vice President Syed Husain told investors "we have an extremely successful track record of development and manufacturing abilities;"
    • During the Company's earnings call on February 18, 2021, Kramer stated the Company was "right on schedule to support" Johnson & Johnson's deliverable of 100 million vaccine doses to the U.S. government in the first half of 2021. Kramer also bragged about Emergent's "eight and counting CDMO COVID-19 partnerships" to manufacture COVID-19 drugs and vaccines; and
    • Emergent's filings with the Securities and Exchange Commission included materially false and misleading risk factors, such as warning that its products may not be approved "if we fail to comply with regulatory requirements." These warnings were inadequate because Emergent allegedly knew its facilities were not in compliance with regulatory requirements.

    Following the disclosure that Emergent would be forced to destroy 15 million vaccine doses, the Company's stock price fell $12.45 per share, or 13.4%, to close at $80.46 per share on April 1, 2021, causing approximately $590 million in market capitalization losses.

    If you invested in Emergent BioSolutions, or have additional information about the issues discussed herein, please contact attorneys Robert N. Cappucci or Joshua K. Porter at 212-894-7200, or via e-mail at or .

    About Entwistle & Cappucci

    Entwistle & Cappucci is a national law firm providing exceptional legal representation to clients globally in the most complex and challenging legal matters. Our practice encompasses all areas of litigation, including securities, antitrust, corporate transactions, general corporate and commercial, creditor's rights and bankruptcy, corporate governance and fiduciary duty, government affairs, insurance, investigations and white-collar defense. Our clients include public and private corporations, major hedge funds, public pension funds, governmental entities, leading institutional investors, domestic and foreign financial services companies, emerging business enterprises and individual entrepreneurs.

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    • HHS has increased Emergent's task order by $23 million to purchase additional biologics manufacturing equipment
    • Reaffirms 2021 financial guidance

    GAITHERSBURG, Md., April 04, 2021 (GLOBE NEWSWIRE) -- Emergent BioSolutions Inc. (NYSE:EBS) today announced that the Company continues to be on track with its manufacturing agreements related to COVID-19 vaccines and confirmed that there are no changes to its financial guidance for 2021. In addition, the Company received a contract modification to increase the original task order by $23 million from Biomedical Advanced Research and Development Authority (BARDA), which is part of the Office of the Assistant Secretary for Preparedness and Response (ASPR) at the U.S. Department of Health & Human Services…

    • HHS has increased Emergent's task order by $23 million to purchase additional biologics manufacturing equipment
    • Reaffirms 2021 financial guidance

    GAITHERSBURG, Md., April 04, 2021 (GLOBE NEWSWIRE) -- Emergent BioSolutions Inc. (NYSE:EBS) today announced that the Company continues to be on track with its manufacturing agreements related to COVID-19 vaccines and confirmed that there are no changes to its financial guidance for 2021. In addition, the Company received a contract modification to increase the original task order by $23 million from Biomedical Advanced Research and Development Authority (BARDA), which is part of the Office of the Assistant Secretary for Preparedness and Response (ASPR) at the U.S. Department of Health & Human Services (HHS).

    The $23 million will be used for the purchase of biologics manufacturing equipment specific to Johnson & Johnson's COVID-19 vaccine for the potential expansion of manufacturing of that bulk drug substance into a third suite of Emergent's Baltimore Bayview facility. In addition, Emergent expects to align with the U.S. government and AstraZeneca on a mutually agreed ramp down of manufacturing for AstraZeneca's COVID-19 vaccine bulk drug substance.

    "Emergent is actively working with the U.S. government to fulfill its policy objectives consistent with the Center for Innovation in Advanced Development and Manufacturing (CIADM) that was put in place under the Obama-Biden Administration in 2012," said Robert G. Kramer, president and chief executive officer of Emergent. "This unique public-private partnership has been a key element in our ability to quickly scale up to produce COVID-19 vaccines at a current rate of more than one billion dose-equivalents annually."

    Emergent continues to own and operate the facility consistent with its obligations to all of its customers and in compliance with the regulatory standards promulgated by the U.S. Food and Drug Administration and all other applicable regulatory authorities.

    "Emergent's top priority continues to be the strengthening of the supply chain for Johnson & Johnson's vitally needed COVID-19 vaccine," added Kramer. "We have been working closely with Johnson & Johnson and welcome the additional oversight and support at our Bayview facility. We value their partnership and that of the U.S. government to help deliver critically needed COVID-19 vaccines to the American public and globally."

    Emergent entered into the landmark COVID-19 arrangement with BARDA, under the CIADM agreement first established as a public-private partnership for pandemic preparedness in 2012. This landmark arrangement was designed to expand manufacturing capacity and has provided the government with the flexibility to use reserved capacity for production for COVID-19 vaccines and therapeutics consistent with the U.S. government's policy objectives.

    Today, Emergent has nine COVID-19 CDMO partnerships with pharmaceutical and biotech innovators, the U.S. government, non-government organizations for vaccines and therapeutics across a multitude of sites and drug substance, drug product, and development service offerings.

    About Emergent BioSolutions

    Emergent BioSolutions is a global life sciences company whose mission is to protect and enhance life. Through Emergent's specialty products and contract development and manufacturing services, Emergent is dedicated to providing solutions that address public health threats. Through social responsibility, Emergent aims to build healthier and safer communities. Emergent aspires to deliver peace of mind to its patients and customers so they can focus on what's most important in their lives. In working together, Emergent envisions protecting or enhancing 1 billion lives by 2030. For additional information, visit Emergent's website and follow Emergent on LinkedIn, Twitter and Instagram.

    Safe Harbor Statement

    This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements, other than statements of historical fact, including statements regarding the total potential realizable value of the Task Order, the timing and number of any of the underlying deliverables, our ability to produce or manufacture viable COVID-19 vaccine candidates at the prescribed scale and on the anticipated timeline and our ability to meet other contractual commitments, statements regarding our financial guidance and any other statements containing the words "believes," "expects," "anticipates," "intends," "plans," "estimates" and similar expressions, are forward-looking statements. These forward-looking statements are based on our current intentions, beliefs and expectations regarding future events. We cannot guarantee that any forward-looking statement will be accurate. Investors should realize that if underlying assumptions prove inaccurate or unknown risks or uncertainties materialize, actual results could differ materially from our expectations. Investors are, therefore, cautioned not to place undue reliance on any forward-looking statement. Any forward-looking statement speaks only as of the date of this press release, and, except as required by law, we do not undertake to update any forward-looking statement to reflect new information, events or circumstances.

    There are a number of important factors that could cause the company's actual results to differ materially from those indicated by such forward-looking statements, including the availability of funding for our U.S. government grants and contracts, decisions by BARDA/ASPR/HHS and other contractual parties to exercise any options under the Task Order and the related contract and our manufacturing capabilities. The foregoing sets forth many, but not all, of the factors that could cause actual results to differ from our expectations in any forward-looking statement. Investors should consider this cautionary statement, as well as the risk factors identified in our periodic reports filed with the SEC, when evaluating our forward-looking statements.

    Emergent BioSolutions Contacts:

    Media:

    Matt Hartwig

    Director, Media Relations

    Investors:

    Robert G. Burrows

    Vice President, Investor Relations



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  2. GAITHERSBURG, Md., April 02, 2021 (GLOBE NEWSWIRE) -- Emergent BioSolutions Inc. (NYSE:EBS) today provided an update on the evaluation of its investigational SARS-CoV-2 Immune Globulin Intravenous (Human) (COVID-HIG) for the treatment of hospitalized patients with COVID-19. The Phase 3 Inpatient Treatment with Anti-Coronavirus Immunoglobulin (ITAC) trial, also known as INSIGHT-013, sponsored and supported by the National Institute of Allergy and Infectious Diseases (NIAID), part of the National Institutes of Health (NIH), assessed the safety and efficacy of four immunoglobulin candidates plus standard of care versus placebo plus standard of care in hospitalized patients with COVID-19. Topline data from the ITAC trial demonstrated that the…

    GAITHERSBURG, Md., April 02, 2021 (GLOBE NEWSWIRE) -- Emergent BioSolutions Inc. (NYSE:EBS) today provided an update on the evaluation of its investigational SARS-CoV-2 Immune Globulin Intravenous (Human) (COVID-HIG) for the treatment of hospitalized patients with COVID-19. The Phase 3 Inpatient Treatment with Anti-Coronavirus Immunoglobulin (ITAC) trial, also known as INSIGHT-013, sponsored and supported by the National Institute of Allergy and Infectious Diseases (NIAID), part of the National Institutes of Health (NIH), assessed the safety and efficacy of four immunoglobulin candidates plus standard of care versus placebo plus standard of care in hospitalized patients with COVID-19. Topline data from the ITAC trial demonstrated that the addition of anti-SARS-CoV-2 hyperimmunoglobulin to standard of care, inclusive of remdesivir, for hospitalized adult COVID-19 patients with symptoms for less than 12 days did not provide clinical benefit when compared to standard of care plus placebo. There were no serious safety concerns identified. 

    "While we are disappointed by these data in hospitalized patients where there remains a high unmet need, we recognize that, similar to other antibody-based therapies, intervention with COVID-HIG earlier in the disease course may be necessary to impact COVID-19 in patients," said Dr. Laura Saward, SVP and therapeutics business unit head at Emergent BioSolutions. "Emergent will continue to explore COVID-HIG as a treatment in ongoing clinical trials. The public-private partnership with NIAID and the Biomedical Advanced Research and Development Authority (BARDA) has been important to generate data on the COVID-HIG investigational product. We also would like to thank all study participants, sites, and investigators across the globe who contributed to this effort."

    COVID-HIG is also being developed as a potential treatment for outpatients at high risk of progression to severe disease with funding from BARDA. It is also being supported with funding from the U.S. Department of Defense.

    This project has been funded in whole or in part with Federal funds from the Department of Health and Human Services, Office of the Assistant Secretary for Preparedness and Response, Biomedical Advanced Research and Development Authority under contract HHSO100201200004I, task order 75A50120F33006.

    About the ITAC Trial  

    The Phase 3 Inpatient Treatment with Anti-Coronavirus Immunoglobulin (ITAC) clinical trial was a global, multi-center, double-blind, placebo-controlled, randomized trial sponsored and funded by the National Institute of Allergy and Infectious Diseases (NIAID), part of the National Institutes of Health (NIH). It was designed to test the safety, tolerability and efficacy of a combination treatment regimen for coronavirus disease 2019 (COVID-19) consisting of the antiviral remdesivir along with an anti-coronavirus hyperimmune intravenous immunoglobulin (H-Ig), which contains a highly concentrated solution of antibodies that neutralize SARS-CoV-2. The antibodies in the H-Ig come from the liquid portion of blood, or plasma, donated by healthy people who have recovered from COVID-19. 

    Through the NIAID-funded INSIGHT network, the study team enrolled nearly 600 adult patients at 63 sites in the United States and 10 other countries on five continents. Volunteers were eligible for the trial if they had been hospitalized for COVID-19 and had symptoms for 12 days or fewer without life-threatening organ dysfunction or end-organ failure. Four companies provided investigational H-Ig materials for the trial, including CSL Behring and Takeda on behalf of the CoVIg-19 Plasma Alliance, as well as Emergent BioSolutions and Grifols. Further information about the ITAC trial is available at ClinicalTrials.gov under study identifier NCT04546581.  

    About Emergent BioSolutions

    Emergent BioSolutions is a global life sciences company whose mission is to protect and enhance life. Through our specialty products and contract development and manufacturing services, we are dedicated to providing solutions that address public health threats. Through social responsibility, we aim to build healthier and safer communities. We aspire to deliver peace of mind to our patients and customers so they can focus on what's most important in their lives. In working together, we envision protecting or enhancing 1 billion lives by 2030. For more information visit www.emergentbiosolutions.com. For additional information, visit Emergent's website and follow Emergent on LinkedInTwitter and Instagram.

    Emergent's Response to COVID-19

    In addition to leveraging its established hyperimmune platform to develop COVID-HIG, Emergent is deploying its molecule-to-market contract development and manufacturing (CDMO) capabilities, capacities, and expertise to help governments/non-government organizations and pharmaceutical/biotechnology partners advance their COVID-19 programs. The company has engaged in nine collaborations to develop and manufacture COVID-19 vaccine and therapeutic candidates. For the COVID-19 response, Emergent's integrated CDMO network provides development services from its Gaithersburg facility, drug substance manufacturing at its Baltimore Bayview facility, and drug product manufacturing at its Baltimore Camden, Rockville, and Winnipeg facilities.

    For more than 22 years Emergent has focused on advancing public health, and its multi-pronged approach to tackling COVID-19 demonstrates its commitment to its mission – to protect and enhance life.

    Safe Harbor Statement

    This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements, other than statements of historical fact, including statements regarding the ability of COVID-HIG to effectively treat hospitalized patients with COVID-19, as well as high-risk, acute symptomatic patients and to become an effective PEP therapeutic for groups at high risk of developing COVID-19, as well as statements regarding planned clinical trials, are forward-looking statements. These forward-looking statements are based on our current intentions, beliefs and expectations regarding future events. We cannot guarantee that any forward-looking statement will be accurate. Investors should realize that if underlying assumptions prove inaccurate or unknown risks or uncertainties materialize, actual results could differ materially from our expectations. Investors are, therefore, cautioned not to place undue reliance on any forward-looking statement. Any forward-looking statement speaks only as of the date of this press release, and, except as required by law, we do not undertake to update any forward-looking statement to reflect new information, events or circumstances.

    There are a number of important factors that could cause the company's actual results to differ materially from those indicated by such forward-looking statements, including the overall success of the collaboration and planned development programs; our ability to maintain a sufficient level of convalescent plasma; the results of planned clinical trials and the timing of and our ability to obtain and maintain regulatory authorizations for emergency or broader patient use or approvals; and our commercialization, marketing and manufacturing capabilities. The foregoing sets forth many, but not all, of the factors that could cause actual results to differ from our expectations in any forward-looking statement. Investors should consider this cautionary statement, as well as the risk factors identified in our periodic reports filed with the SEC, when evaluating our forward-looking statements.

    Media Contact:

    Matt Hartwig

    Director, Media Relations

    Investor Contact:

    Robert G. Burrows

    Vice President, Investor Relations

    240-631-3280



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  3. GAITHERSBURG, Md., March 01, 2021 (GLOBE NEWSWIRE) -- Emergent BioSolutions Inc. (NYSE:EBS) announced today that members of the company's senior management team will participate in the following investor conferences:

    • Jefferies Inaugural Global Plasma Summit
      March 11, 2021
      Company fireside chat scheduled at 12:50 pm EST

    • KeyBanc Life Sciences & MedTech Investor Forum
      March 24, 2021
      Company fireside chat scheduled at 1:15 pm EST
    • Chardan 4th Annual Manufacturing Summit
      April 26-27, 2021
      Fireside chat date and time will be updated on the Emergent website as the information becomes available.
    • Truist 7th Annual Life Sciences Summit
      May 4-5, 2021
      Presentation date and time will be updated on the Emergent website as the information becomes available.

    For…

    GAITHERSBURG, Md., March 01, 2021 (GLOBE NEWSWIRE) -- Emergent BioSolutions Inc. (NYSE:EBS) announced today that members of the company's senior management team will participate in the following investor conferences:

    • Jefferies Inaugural Global Plasma Summit

      March 11, 2021

      Company fireside chat scheduled at 12:50 pm EST



    • KeyBanc Life Sciences & MedTech Investor Forum

      March 24, 2021

      Company fireside chat scheduled at 1:15 pm EST
    • Chardan 4th Annual Manufacturing Summit

      April 26-27, 2021

      Fireside chat date and time will be updated on the Emergent website as the information becomes available.
    • Truist 7th Annual Life Sciences Summit

      May 4-5, 2021

      Presentation date and time will be updated on the Emergent website as the information becomes available.

    For conferences where a presentation is planned, the company's webcast presentation may include a discussion of the company's recent business developments as well as its financial results and guidance. The webcasts will be available both live, if possible, and by replay, and will be accessible from the Emergent website.

    About Emergent BioSolutions

    Emergent BioSolutions is a global life sciences company whose mission is to protect and enhance life. Through our specialty products and contract development and manufacturing services, we are dedicated to providing solutions that address public health threats. Through social responsibility, we aim to build healthier and safer communities. We aspire to deliver peace of mind to our patients and customers so they can focus on what's most important in their lives. In working together, we envision protecting or enhancing 1 billion lives by 2030. For more information, visit our website and follow us on LinkedIn, Twitter, and Instagram.

    Investor Contact:

    Robert G. Burrows

    Vice President, Investor Relations

    240-631-3280

    Media Contact:

    Nina DeLorenzo

    SVP, Global Communications & Public Affairs



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    • Reports record fourth quarter and year to date 2020 performance, in line with prior guidance
    • Reaffirms full year 2021 forecast

    GAITHERSBURG, Md., Feb. 18, 2021 (GLOBE NEWSWIRE) -- Emergent BioSolutions Inc. (NYSE:EBS) today reported financial results for the quarter and year ended December 31, 2020. The Company also reaffirmed its full year 2021 forecast.

    "Emergent's financial and operational performance in 2020 reflects the impact we are making in addressing the growing public health threat landscape and meeting our mission to protect and enhance the lives of patients," said Robert G. Kramer, president and CEO of Emergent BioSolutions. "We look forward to continuing to execute on our strategy with vaccines, therapeutics, devices…

    • Reports record fourth quarter and year to date 2020 performance, in line with prior guidance
    • Reaffirms full year 2021 forecast

    GAITHERSBURG, Md., Feb. 18, 2021 (GLOBE NEWSWIRE) -- Emergent BioSolutions Inc. (NYSE:EBS) today reported financial results for the quarter and year ended December 31, 2020. The Company also reaffirmed its full year 2021 forecast.

    "Emergent's financial and operational performance in 2020 reflects the impact we are making in addressing the growing public health threat landscape and meeting our mission to protect and enhance the lives of patients," said Robert G. Kramer, president and CEO of Emergent BioSolutions. "We look forward to continuing to execute on our strategy with vaccines, therapeutics, devices, and contract development and manufacturing services. Our strong core business, robust development pipeline, and innovator and public-private partnership opportunities position us to remain leaders in the market and create long-term shareholder value."

    FINANCIAL HIGHLIGHTS (1)

    (in millions, except per share data)Q4 2020Q4 2019% Change
    Total Revenues$583.0$360.462%
    Net Income$185.4$46.9*
    Net Income Per Diluted Share$3.44$0.90*
    Adjusted Net Income (2)$198.8$82.7*
    Adjusted Net Income Per Diluted Share (2)$3.67$1.57*
    Adjusted EBITDA (2)$290.9$134.3*
          



    (in millions, except per share data)Full Year 2020Full Year 2019% Change
    Total Revenues$1,555.4$1,106.041%
    Net Income$305.1$54.5*
    Net Income Per Diluted Share$5.67$1.04*
    Adjusted Net Income (2)$423.9$152.3*
    Adjusted Net Income Per Diluted Share (2)$7.88$2.91*
    Adjusted EBITDA (2)$630.4$279.7*
    * % change greater than 100%
     

    SELECT Q4 2020 AND RECENT BUSINESS ACCOMPLISHMENTS

    • Completed three-year, $50 million expansion at the Company's Baltimore Camden drug product facility, including a new state-of-the-art fill/finish line that became operational in January 2021, intended to significantly increase contract development and manufacturing (CDMO) capacity and capability.
    • Signed a CDMO services agreement with Providence Therapeutics to provide drug product manufacturing services for their mRNA PTX-COVID19-B vaccine candidate at the Company's Winnipeg, Manitoba facility.
    • Signed a CDMO services agreement for drug product manufacturing of Humanigen's COVID-19 therapeutic candidate, lenzilumab™, at the Company's Baltimore Camden facility.
    • Initiated a Phase 3 clinical trial with the National Institutes of Health to evaluate hyperimmune globulins, including the Company's COVID-19 human hyperimmune globulin (COVID-HIG) product candidate, as a potential treatment in adult patients hospitalized with COVID-19.
    • Initiated a clinical program to evaluate COVID-HIG to support its use for potential post-exposure prophylaxis in individuals at high risk of exposure to SARS-CoV-2 such as front-line health care workers and military personnel.

    2020 FINANCIAL PERFORMANCE (1)

    (I) Quarter Ended December 31, 2020

    Revenues

    Total Revenues

    For Q4 2020, total revenues were $583.0 million, an increase of 62% over the same period in Q4 2019, primarily driven by increased contract development and manufacturing (CDMO) services revenues.

    Product Sales

    For Q4 2020, total product sales were $340.9 million, an increase of $30.1 million or 10% as compared to Q4 2019. Other product sales decreased due to a decline in sales of raxibacumab, VIGIV [Vaccinia Immune Globulin Intravenous (Human)] and the Company's travel health vaccines, partially offset by increased sales of BAT®[Botulism Antitoxin Heptavalent (A, B, C, D, E, F, G) - (Equine)].

     Three Months Ended December 31,
    (in millions)20202019% Change
    Product Sales:      
    ACAM2000®$129.3$78.565%
    Anthrax Vaccines$115.7$92.925%
    NARCAN® Nasal Spray$77.4$66.916%
    Other$18.5$72.5(74)%
    Total Product Sales$340.9$310.810%
           

    Contract Development and Manufacturing (CDMO) Services

    For Q4 2020, revenue from CDMO services was $199.1 million, an increase of $173.6 million as compared to Q4 2019. The increase is largely due to the contribution for services performed to address the COVID-19 pandemic provided to pharmaceutical and biotechnology innovators and government/non-government organization (NGO) customers across Development Services, Drug Substance manufacturing, and Drug Product manufacturing and Packaging.

    Contracts and Grants

    For Q4 2020, revenue from development-based contracts and grants was $43.0 million, an increase of $18.9 million or 78% as compared to Q4 2019. The increase primarily reflects the contribution from development awards related to the Company's COVID-HIG product candidate, partially offset by a decrease in  contribution associated with development activities from the Company's AV7909 (Anthrax Vaccine Adsorbed, adjuvanted) product candidate, reflecting the advanced stage of development for the program.

    Operating Expenses

    Cost of Product Sales and Contract Development and Manufacturing (CDMO) Services

    For Q4 2020, cost of product sales and CDMO services was $168.3 million, an increase of $35.5 million or 27% as compared to Q4 2019. Cost of product sales and CDMO services includes the impact of contingent consideration charges, which declined $12 million in Q4 2020 compared to Q4 2019. Excluding the impacts of the contingent consideration charges between periods, the cost of product sales and CDMO services increased $47.5 million. This increase is primarily due to an increase in CDMO services and product sale activities in Q4 2020 as compared to Q4 2019.

    Research and Development (Gross and Net) (2)

    For Q4 2020, gross R&D expenses were $59.5 million, a decrease of $3.3 million or 5% as compared to Q4 2019. The decrease primarily reflects the impact of the impairment of the IPR&D intangible asset in Q4 2019 that did not recur in Q4 2020, offset by increased costs associated with the Company's COVID-19 product candidates.

    For Q4 2020, net R&D expense, which reflects investments made in development programs that are not currently funded in whole or in part by third-party partners, was $16.5 million, a decrease of $10.2 million or 38% as compared to Q4 2019. The decrease is attributable to a reduction in R&D activities at the Company's Bayview facility in 2020 compared to 2019 as the facility was principally used for CDMO services in 2020. The Q4 2020 and Q4 2019 net R&D expense was 3% and 8% of adjusted revenue, respectively.

    Selling, General and Administrative

    For Q4 2020, selling, general and administrative expenses were $82.1 million, an increase of $9.9 million or 14% as compared to Q4 2019. The increase primarily reflects an increase in staffing costs to support the Company's growth.

    Additional Financial Information

    Gross Margin (2)

    For Q4 2020, gross margin was $371.7 million or 69% of adjusted revenue, an increase of $168.2 million or 8% as compared to Q4 2019. For Q4 2020, adjusted gross margin was $370.6 million or 69% of adjusted revenue, an increase of $154.7 million or 4% as compared to Q4 2019. The improvement reflects the impact of product mix as well as improved contribution from CDMO services.

    CDMO Backlog and Opportunity Funnel

    CDMO backlog, defined as estimated future services revenues for 2021 and beyond under signed contracts, was $1.34 billion at December 31, 2020, reflecting the impact of additional services on existing contracts and newly awarded contracts of $53.3 million during the quarter offset by revenue recognized to date on contracted amounts.

    The CDMO opportunity funnel, defined as the initial contract value to potentially be realized in 2021 and beyond based on issued proposals as well as the value of extensions associated with existing contracts, was approximately $689 million as of December 31, 2020. This amount reflects the increased traction resulting from ongoing sales and business development and marketing efforts domestically and internationally to existing and new pharmaceutical and biotechnology innovators as well as government/NGO customers, and excludes the potential value of extensions of contracts with Johnson & Johnson and AstraZeneca.

    (II) Full Year 2020

    Revenues

    Total Revenues

    For the full year 2020, total revenues were $1,555.4 million, an increase of 41% over 2019. Total revenues largely reflect an increase in contract development and manufacturing services revenues as well as product sales.

    Product Sales

    For the full year 2020, product sales were $989.8 million, an increase of $86.3 million or 10% as compared to 2019. Other product sales decreased due to a decline in sales of raxibacumab and travel health vaccines.

     Year Ended December 31,
    (in millions)20202019% Change
    Product Sales:
    Anthrax Vaccines$373.8$172.8*
    NARCAN® Nasal Spray$311.2$280.411%
    ACAM2000®$200.3$242.6(17)%
    Other$104.5$207.7(50)%
    Total Product Sales$989.8$903.510%
           

    Contract Development and Manufacturing (CDMO) Services

    For the full year 2020, revenue from CDMO services was $450.5 million, an increase of $370.5 million as compared to 2019. The increase is largely due to the contribution for services performed to address the COVID-19 pandemic provided to pharmaceutical and biotechnology innovators and government/NGO customers across Development Services, Drug Substance manufacturing, and Drug Product manufacturing and Packaging.

    Contracts and Grants

    For the full year 2020, revenue from development-based contracts and grants was $115.1 million, a decrease of $7.4 million or 6% as compared to 2019. The decrease primarily reflects  the  completion  of  development  activities associated with the AV7909 product candidate in 2019, offset by recent new development awards related to the Company's COVID-19 product candidates and other product candidates.

    Operating Expenses

    Cost of Product Sales and Contract Development and Manufacturing Services

    For the full year 2020, cost of product sales and CDMO services was $524.0 million, an increase of $90.5 million or 21% as compared to 2019. The increase is due primarily to an increase in volume of product sales and CDMO services, charges related to the Company's contingent consideration liabilities, and a write-down of inventory for the Company's travel health vaccines.

    Research and Development (Gross and Net) (2)

    For the full year 2020, gross R&D expenses were $234.5 million, an increase of $8.3 million or 4% compared to 2019. The increase primarily reflects the impact of impairment of the Company's IPR&D intangible asset of $29.0 million in 2020 as compared to $12.0 million in 2019. Excluding these items, gross R&D expense decreased $8.7 million compared to 2019. The decrease primarily reflects lower costs associated with the Company's AV7909 product candidate, reflecting the advanced-stage of its development, offset by increased costs associated with the Company's COVID-19 product candidates.

    For the full year 2020, net R&D expense was $90.4 million, a decrease of $1.3 million or 1% as compared to 2019. The decrease primarily reflects a decline in spending associated with the Company's FLU-IGIV and CHIKV VLP product candidates and the change in the nature of operations from primarily R&D to commercial CDMO manufacturing at the Company's Bayview facility, offset by an increase in costs associated with the Company's COVID-19 and other product candidates. The 2020 and 2019 net R&D expense as a percentage of adjusted revenues was 6% and 9%, respectively.

    Selling, General and Administrative

    For the full year 2020, selling, general and administrative expenses were $303.3 million, an increase of $29.8 million or 11% as compared to 2019. The increase primarily reflects an increase in staffing costs to support the Company's growth as well as an increase in share-based compensation due to a special broad-based, immediately vested equity award to employees.

    Additional Financial Information

    Gross Margin (2)

    For the full year 2020, gross margin was $916.3 million or 64% of adjusted revenue, an increase of $366.3 million or 8% as compared to 2019. For the full year 2020, adjusted gross margin was $960.6 million or 67% of adjusted revenue, an increase of $385.8 million or 8% as compared to 2019. The improvement reflects the impact of product mix as well as improved contribution from CDMO services.

    Operating Cash Flow

    For the full year 2020, operating cash flow was $536.0 million, an increase of $348.0 million as compared to 2019. The increase reflects the cash generating strength of the Company's current diversified mix of product sales and CDMO services.

    Capital Expenditures

    For the full year 2020, capital expenditures were $141.0 million, an increase of $54.1 million or 62% as compared to 2019. Expressed as a percentage of total revenues, capital expenditures for the full year 2020 was 9%, versus 8% in 2019. The 2020 figure reflects investments in key areas of the Company's operations, including technology, and capacity and capability expansions in service of the CDMO business. In 2020, the company was reimbursed for $41.8 million of capital expenditures pursuant to third-party funding arrangements, resulting in capital expenditures net of reimbursement of $99.2 million.

    2021 FINANCIAL FORECAST

    For full year 2021, the Company reaffirms its forecast of the following financial metrics, originally announced on January 10, 2021:

    (in millions)2021 Forecast (As of 2/18/2021)
    Total Revenues$1,950 - $2,050
    •           NARCAN® Nasal Spray$305 - $325
    •           Anthrax Vaccines$280 - $310
    •           ACAM2000®$185 - $205
    •           CDMO$925 - $965
    Adjusted EBITDA (2)$750 - $810
    Adjusted Net Income (2)$475 - $525
    Gross Margin (2)65%
      

    The Company's financial forecast for 2021 includes the following additional considerations:

    • Anthrax vaccine revenues are expected at a more normalized annual level and continue to primarily reflect procurement of AV7909 (Anthrax Vaccine Adsorbed, adjuvanted) under the Company's existing contract with the Biomedical Advanced Research and Development Authority (BARDA).
    • ACAM2000® (Smallpox (Vaccinia) Vaccine, Live) vaccine deliveries are expected to continue under the terms of the Company's existing contract with the U.S. Department of Health and Human Services (HHS) at unit volume levels consistent with 2020 deliveries.
    • Narcan® (naloxone HCl) Nasal Spray revenues assume an appellate decision related to its pending patent litigation in the second half of 2021 followed by the entry of at least one competitor.
    • CDMO Services assume continued performance of contracted services for Development Services (DVS), Drug Substance (DS) manufacturing, and Drug Product (DP) manufacturing and Packaging for both clinical- and commercial-stage projects on behalf of a growing list of pharmaceutical and biotechnology innovators and government/NGO customers.
    • Pipeline progress is expected across the vaccines, therapeutics, and devices portfolios, anticipating at least one Phase 3 launch and one Biologics License Application (BLA)/Emergency Use Authorization (EUA) filing.
    • Capital expenditures, net of reimbursement, are expected to be in a range of 8% to 9% of total revenues, reflecting ongoing investments in capacity and capability expansions in support of the Company's CDMO services business and product portfolio.

    Q1 2021 REVENUE FORECAST

    For Q1 2021, the Company expects total revenues of $330 million to $370 million.

    FOOTNOTES

    (1) All financial information incorporated within this release is unaudited

    (2) See "Reconciliation of Net Income to Adjusted Net Income and Adjusted EBITDA, Gross Margin and Adjusted Gross Margin and Net Research and Development Expenses" for a definition of terms and reconciliation tables.

    CONFERENCE CALL AND WEBCAST INFORMATION

    Company management will host a conference call at 5:00 pm (Eastern Time) today, February 18, 2021, to discuss these financial results. The conference call can be accessed from the Company's website or through the following:

    Live Teleconference Information:

    Dial in: [US] (855) 766-6521; [International] (262) 912-6157

    Conference ID: 3948196



    Live Webcast Information:

    Visit https://edge.media-server.com/mmc/p/hmesjhe3 for the webcast.
     

    A replay of the call can be accessed at www.emergentbiosolutions.com under "Investors."

    ABOUT EMERGENT BIOSOLUTIONS INC.

    Emergent BioSolutions is a global life sciences company whose mission is to protect and enhance life. Through our specialty products and contract development and manufacturing services, we are dedicated to providing solutions that address public health threats. Through social responsibility, we aim to build healthier and safer communities. We aspire to deliver peace of mind to our patients and customers so they can focus on what's most important in their lives. In working together, we envision protecting or enhancing 1 billion lives by 2030. For more information, visit www.emergentbiosolutions.com. Find us on LinkedIn and follow us on Twitter @emergentbiosolu and Instagram @life_at_emergent.

    RECONCILIATION OF NON-GAAP MEASURES

    This press release contains financial measures (Adjusted Net Income, Adjusted EBITDA (Earnings Before Depreciation and Amortization, Interest and Taxes, Gross Margin, Adjusted Gross Margin and Net Research and Development expenses)) that are considered "non-GAAP" financial measures under applicable Securities and Exchange Commission rules and regulations. These non-GAAP financial measures should be considered supplemental to and not a substitute for financial information prepared in accordance with generally accepted accounting principles. The Company's definition of these non-GAAP measures may differ from similarly titled measures used by others. Adjusted net income adjusts for specified items that can be highly variable or difficult to predict, or reflect the non-cash impact of charges. All adjustments are tax effected utilizing the federal statutory tax rate for the US, except for changes in the fair value of contingent consideration as the vast majority is non-deductible for tax purposes. Adjusted net income margin is defined as adjusted net income divided by total revenues. Adjusted EBITDA reflects net income excluding the impact of depreciation, amortization, interest expense and income tax provision (benefit), excluding specified items that can be highly variable and the non-cash impact of certain accounting adjustments. Adjusted EBITDA margin is defined as Adjusted EBITDA divided by total revenues. Gross margin reflects adjusted revenues minus cost of product sales and contract development and manufacturing services (COGS). Adjusted revenues is calculated as total revenues minus contracts and grants revenues. Gross margin percentage is calculated as gross margin divided by adjusted revenues. Adjusted gross margin adjusts COGS for specified items that can be highly variable or difficult to predict, or to reflect the non-cash impacts of charges (Adjusted COGS). Adjusted gross margin is calculated as adjusted revenues minus adjusted COGS. Adjusted gross margin percentage is calculated as adjusted gross margin divided by adjusted revenues. Net research and development expenses reflects research and development expenses adjusted to reflect expenses which are funded (contracts and grants revenue) and non-cash impairment of IPR&D charges. Net research and development margin is calculated as net research and development divided by adjusted revenue. The Company views these non-GAAP financial measures as a means to facilitate management's financial and operational decision- making, including evaluation of the Company's historical operating results and comparison to competitors' operating results. These non-GAAP financial measures reflect an additional way of viewing aspects of the Company's operations that, when viewed with GAAP results and the reconciliations to the corresponding GAAP financial measure may provide a more complete understanding of factors and trends affecting the Company's business.

    The determination of the amounts that are excluded from these non-GAAP financial measures are a matter of management judgment and depend upon, among other factors, the nature of the underlying expense or income amounts. Because non-GAAP financial measures exclude the effect of items that will increase or decrease the Company's reported results of operations, management strongly encourages investors to review the Company's consolidated financial statements and publicly filed reports in their entirety.

    SAFE HARBOR STATEMENT

    This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements, other than statements of historical fact,  including,  without  limitation,  our  financial guidance and related projections and statements regarding our ability to meet such projections in the anticipated timeframe, if at all; statements regarding continuing to execute on our strategy across all four of our business units; remaining leaders in the market and creating long-term shareholder value; the effectiveness of COVID-HIG at treating   adult patients hospitalized with COVID-19 and its effectiveness as potential post-exposure prophylaxis in individuals at  high risk of exposure to COVID-19, such as front-line health care workers and military personnel; normalized annual  anthrax vaccine revenue levels and continued procurement under the Company's existing contract with BARDA; continued ACAM2000 vaccine deliveries consistent with 2020 deliveries; the results of the appellate decision related to pending patent litigation followed by the entry of at least one competitor for NARCAN® Nasal Spray 4mg/spray; continued performance of CDMO services for both clinical- and commercial-stage projects on behalf of a growing list of pharmaceutical and biotechnology innovators and government/NGO customers; pipeline progress and at least one BLA  or EUA submission in 2021; the percentage of capital expenditures as a percentage of total revenues (net of reimbursement), ongoing investments in capacity and capability expansions  in  support  of  the  Company's  CDMO services business and product portfolio; our CDMO backlog  and  opportunity  funnel and any other  statements containing  the  words  "will,"  "believes,"  "expects,"  "anticipates,"  "intends"  "plans,"  "targets,"  "forecasts," "estimates" and similar expressions in conjunction with, among other things, discussions of the Company's outlook, financial performance or financial condition, financial and operation goals, strategic  goals,  growth  strategy,  product sales, government development or procurement contracts or awards, government appropriations, manufacturing capabilities, and the timing of certain regulatory approvals or expenditures are forward-looking statements. These forward-looking statements are based on our current intentions, beliefs and expectations regarding future events. We cannot guarantee that any forward-looking statement will be accurate.

    Investors should realize that if underlying assumptions prove inaccurate or unknown risks or uncertainties materialize, actual results could differ materially from our expectations. Investors are, therefore, cautioned not to place  undue reliance on any forward-looking statement. Any forward-looking statements speak only as of the date of this press  release, and, except as required by law, we do not undertake to update any forward-looking statement to reflect new information, events or circumstances. There are a number of important factors that could cause our actual results to differ materially from those indicated by such forward-looking statements, including the impact of global economic conditions and public health crises and epidemics, such as the global pandemic that arose from COVID-19, on the markets, our operations, and employees as well as those of our customers and suppliers; availability of U.S. government funding for procurement for our products and certain product candidates and the future exercise of options under contracts related to such procurement; the negotiation of further commitments or contracts related to the collaboration and deployment of capacity toward future commercial manufacturing under our CDMO contracts; our ability to perform under our contracts with the U.S. government and our CDMO clients, including the timing of and specifications relating to deliveries; the continued exercise of discretion by BARDA to procure additional doses of AV7909 prior to approval by the FDA; our ability to secure licensure of AV7909 from the FDA within the anticipated timeframe, if at all; our ability to secure follow-on procurement contracts for our solutions to public health threats that are under procurement contracts that have expired or will be expiring; our ability to successfully appeal the patent litigation decision related to NARCAN® Nasal Spray 4mg/spray; our ability and the ability of our collaborators to enforce patents related to NARCAN® Nasal Spray against potential generic entrants; our ability to identify and acquire companies, businesses, products or product candidates that satisfy our selection criteria; our ability and the ability of our contractors and suppliers to maintain compliance with Current Good Manufacturing Practices and other regulatory obligations; our ability to obtain or maintain FDA approval or authorization for emergency or broader patient use of our COVID-19 treatment candidates and their actual safety and effectiveness; timing of and results of clinical trials; our ability to comply with the operating and financial covenants required by our senior secured credit facilities and the indenture governing our senior unsecured notes due 2028; our ability to obtain and maintain regulatory approvals for our other product candidates and the timing of any such approvals; the procurement of products by U.S. government entities under regulatory exemptions prior to approval by the FDA and corresponding procurement by government entities outside of the United States under regulatory exemptions prior to approval by the corresponding regulatory authorities in the applicable country; the success of our commercialization, marketing and manufacturing capabilities and strategy; and the accuracy of our estimates regarding future revenues, expenses, and capital requirements and needs for additional financing. The foregoing sets forth many, but not all, of the factors that could cause actual results to differ from our expectations in any forward-looking statement. Investors should consider this cautionary statement as well as the risk factors identified in our periodic reports filed with the Securities and Exchange Commission when evaluating our forward-looking statements.

    Investor Contact

    Robert Burrows

    Vice President, Investor Relations

    (o) 240/631-3280; (m) 240/413-1917

                  Media Contact

    Nina DeLorenzo

    SVP, Global Communications & Public Affairs

       

    Emergent BioSolutions Inc.

    Consolidated Balance Sheets

    (unaudited in millions, except per share data)

     December 31,
     20202019
    ASSETS      
    Current assets:      
    Cash and cash equivalents$621.3 $167.8 
    Restricted cash 0.2  0.2 
    Accounts receivable, net 230.9  270.7 
    Inventories 307.0  222.5 
    Prepaid expenses and other current assets 36.5  25.0 
    Total current assets 1,195.9  686.2 
           
    Property, plant and equipment, net 644.1  542.3 
    Intangible assets, net 663.1  712.9 
    In-process research and development   29.0 
    Goodwill 266.7  266.6 
    Other assets 113.4  90.3 
    Total assets$2,883.2 $2,327.3 
           
    LIABILITIES AND STOCKHOLDERS' EQUITY      
    Current liabilities:      
    Accounts payable 136.1  94.8 
    Accrued expenses46.9  39.5 
    Accrued compensation84.6  62.4 
    Debt, current portion33.8  12.9 
    Other current liabilities83.1  6.7 
    Total current liabilities384.5  216.3 
           
    Contingent consideration, net of current portion 34.2  26.0 
    Debt, net of current portion 841.0  798.4 
    Deferred tax liability 53.2  63.9 
    Contract liabilities, net of current portion 55.5  85.6 
    Other liabilities 67.8  48.6 
    Total liabilities$1,436.2 $1,238.8 



    Stockholders' equity:      
    Preferred stock, $0.001 par value; 15.0 shares authorized, no shares issued and outstanding    
           
    Common stock, $0.001 par value; 200.0 shares authorized, 54.3 and 53.0 shares issued; 53.1 and 51.7 shares outstanding, respectively. 0.1  0.1 
    Treasury stock, at cost, 1.2 common shares (39.6) (39.6)
    Additional paid-in capital 784.9  716.1 
    Accumulated other comprehensive loss, net (25.3) (9.9)
    Retained earnings 726.9  421.8 
    Total stockholders' equity 1,447.0  1,088.5 
    Total liabilities and stockholders' equity$2,883.2 $2,327.3 
           

    Emergent BioSolutions Inc.

    Consolidated Statements of Operations

    (unaudited in millions, except per share data)

     Three Months Ended December 31,
     20202019
    Revenues:      
    Product sales, net$340.9 $310.8 
    Contract development and manufacturing services 199.1  25.5 
    Contracts and grants 43.0  24.1 
    Total revenues 583.0  360.4 
         
    Operating expenses:    
    Cost of product sales and contract development and manufacturing services 168.3  132.8 
    Research and development 59.5  62.8 
    Selling, general and administrative 82.1  72.2 
    Amortization of intangible assets 15.0  14.8 
    Total operating expenses 324.9  282.6 
           
    Income from operations 258.1  77.8 
           
    Other income (expense):      
    Interest expense (8.7) (9.1)
    Other, net 3.4  2.8 
    Total other income (expense), net (5.3) (6.3)
           
    Income before income taxes 252.8  71.5 
    Income taxes 67.4  24.6 
    Net income$185.4 $46.9 
           
    Net Income per common share      
    Basic$3.51 $0.91 
    Diluted$3.44 $0.90 
         
    Shares used in computing income per share    
    Basic53.1 51.7 
    Diluted54.2 52.6 
         

    Emergent BioSolutions Inc.

    Consolidated Statements of Operations

    (unaudited in millions, except per share data)

     Year Ended December 31,
     20202019
    Revenues:      
    Product sales, net$989.8 $903.5 
    Contract development and manufacturing services 450.5  80.0 
    Contracts and grants 115.1  122.5 
    Total revenues 1,555.4  1,106.0 
           
    Operating expenses:      
    Cost of product sales and contract development and manufacturing services 524.0  433.5 
    Research and development 234.5  226.2 
    Selling, general and administrative 303.3  273.5 
    Amortization of intangible assets 59.8  58.7 
    Total operating expenses 1,121.6  991.9 
           
    Income from operations 433.8  114.1 
           
    Other income (expense):      
    Interest expense (31.3) (38.4)
    Other, net 4.7  1.7 
    Total other income (expense), net (26.6) (36.7)
           
    Income before income taxes 407.2  77.4 
    Income taxes 102.1  22.9 
    Net income$305.1 $54.5 
           
    Net Income per common share      
    Basic$5.79 $1.06 
    Diluted$5.67 $1.04 
         
    Shares used in computing income per share    
    Basic52.7 51.5 
    Diluted53.8 52.4 
         

    Emergent BioSolutions Inc.

    Consolidated Statements of Cash Flows

    (unaudited in millions)

     Year Ended December 31,
     20202019
    Cash flows from operating activities:      
    Net income$305.1 $54.5 
    Adjustments to reconcile to net cash provided by operating activities:      
    Stock-based compensation expense 51.0  26.7 
    Depreciation and amortization 114.5  110.7 
    Impairment of intangible asset 29.0  12.0 
    Change in fair value of contingent obligations, net 31.7  24.8 
    Amortization of deferred financing costs 3.5  3.0 
    Deferred income taxes (2.4) (1.1)
    Other

     (5.2) (0.2)
    Changes in operating assets and liabilities, net of business acquisitions:      
    Accounts receivable 49.0  (8.2)
    Inventories (83.2) (16.7)
    Prepaid expenses and other assets (29.2) (39.1)
    Accounts payable 19.8  16.5 
    Accrued expenses and other liabilities 19.4  (15.1)
    Accrued compensation 21.8  4.2 
    Contract liabilities 11.2  16.0 
    Net cash provided by operating activities 536.0  188.0 
    Cash flows from investing activities:      
    Purchases of property, plant and equipment and other (141.0) (86.9)
    Milestone payment from asset acquisition (10.0) (10.0)
    Net cash used in investing activities (151.0) (96.9)
    Cash flows from financing activities:      
    Proceeds from revolving credit facility   130.0 
    Principal payments on revolving credit facility (373.0) (105.0)
    Proceeds from term loan facility    
    Principal payments on term loan facility (14.1) (11.3)
    Proceeds from senior unsecured notes 450.0   
    Debt issuance costs (8.4)  
    Proceeds from share-based compensation activity 31.6  8.2 
    Taxes paid for share-based compensation activity (13.8) (7.4)
    Contingent consideration payments (2.8) (50.4)
    Net cash (used in) provided by financing activities 69.5  (35.9)
    Effect of exchange rate changes on cash and cash equivalents (1.0) 0.4 
    Net change in cash and cash equivalents and restricted cash 453.5  55.6 
    Cash and cash equivalents and restricted cash at beginning of year 168.0  112.4 
    Cash and cash equivalents and restricted cash at end of year$621.5 $168.0 
           

    Reconciliation of Net Income to Adjusted Net Income

     Three Months Ended December 31,
    (in millions, except per share value) 2020  2019 Source
    Net Income$185.4 $46.9  
    Adjustments:       
    + Non-cash amortization charges 16.2  15.6 Intangible Asset Amortization, Other Income
    + Changes in fair value of contingent consideration 0.4  12.4 COGS
    + Exit and disposal costs 0.1   COGS, SG&A, Other Income
    + Acquisition-related costs (transaction & integration) 0.1  2.0 SG&A
    + Impairment of IPR&D intangible asset   12.0 R&D
    Tax effect (3.4) (6.2) 
    Total Adjustments: 13.4  35.8  
    Adjusted Net Income$198.8 $82.7  
    Adjusted Net Income Per Diluted Share$3.67 $1.57  
            



     Year Ended December 31,
    (in millions, except per share value) 2020  2019 Source
    Net Income$305.1 $54.5  
    Adjustments:
    + Non-cash amortization charges 63.4  61.7 Intangible Asset Amortization, Other Income
    + Change in fair value of contingent consideration 31.7  24.8 COGS
    + Impairment of IPR&D 29.0  12.0 R&D
    + Exit and disposal costs 17.2   COGS, SG&A, Other Income
    + Acquisition-related costs (transaction & integration) 0.6  12.6 SG&A
    + Impact of purchase accounting on inventory step-up   6.1 COGS
    Tax effect (23.1) (19.4) 
    Total Adjustments: 118.8  97.8  
    Adjusted Net Income$423.9 $152.3  
    Adjusted Net Income Per Diluted Share$7.88 $2.91  
            



     Full Year Forecast

     
    (in millions)2021FSource
    Net Income$420.0 - $470.0  
    Adjustments:
    + Non-cash amortization charges64.0 Intangible Asset Amortization, Other Income
    + Changes in fair value of contingent consideration3.0 COGS
    + Acquisition-related costs (transaction & integration)2.0 SG&A
    Tax effect(14.0) 
    Total Adjustments:55.0  
    Adjusted Net Income$475.0 - $525.0  
        

    Reconciliation of Net Income to EBITDA and Adjusted EBITDA

     Three Months Ended December 31,
    (in millions) 2020 2019
    Net Income$185.4$46.9
    Adjustments: 
    + Depreciation & amortization 28.9 27.9
    + Income Taxes 67.4 24.6
    + Total interest expense, net* 8.6 8.5
    + Change in fair value of contingent consideration 0.4 12.4
    + Exit and disposal costs* 0.1 
    + Acquisition-related costs (transaction & integration) 0.1 2.0
    + Impairment of IPR&D intangible asset  12.0
    Total Adjustments 105.5 87.4
    Adjusted EBITDA$290.9$134.3
    * Includes interest income of $0.1 million in 2020 and $0.7 million in 2019
     



     Year Ended December 31,
    (in millions)20202019
    Net Income$305.1$54.5
    Adjustments:  
    + Depreciation & amortization 114.5 110.7
    + Total interest expense, net* 30.2 36.1
    + Income tax expense 102.1 22.9
    + Change in fair value of contingent consideration 31.7 24.8
    + Impairment of IPR&D intangible asset 29.0 12.0
    + Exit and disposal costs 17.2 
    + Acquisition-related costs (transaction & integration) 0.6 12.6
    + Impact of purchase accounting on inventory step-up  6.1
    Total Adjustments 325.3 225.2
    Adjusted EBITDA$630.4$279.7
    * Includes interest income of $1.1 million in 2020 and $2.4 million in 2019
     







    (in millions)
    Full Year Forecast
    2021F
    Net Income$420.0 - $470.0
    Adjustments:
    + Depreciation & amortization133.0
    + Income taxes161.0 - 171.0
    + Total interest expense31.0
    + Acquisition-related costs (transaction & integration)2.0
    + Change in fair value of contingent consideration3.0
    Total Adjustments330.0 - 340.0
    Adjusted EBITDA$750.0 - $810.0
      

    Reconciliation of Gross Margin and Adjusted Gross Margin

    (in millions)Three Months Ended December 31,Twelve Months Ended December 31,
     2020  2019  2020  2019 
    Total revenues$583.0 $360.4 $1,555.4 $1,106.0 
    Less: Contract and grants revenues (43.0) (24.1) (115.1) (122.5)
    Adjusted revenues$540.0 $336.3 $1440.3 $983.5 
     
    Cost of product sales and contract development and manufacturing services ("COGS")$168.3 $132.8 $524.0 $433.5 
    - Changes in fair value of contingent consideration (0.4) (12.4) (31.7) (24.8)
    - Inventory reserves related to Travel Health vaccines 1.5    (12.6)  
    Adjusted COGS$169.4 $120.4 $479.7 $408.7 
     
    Gross margin (adjusted revenues minus COGS)$371.7 $203.5 $916.3 $550.0 
    Gross margin % (gross margin divided by adjusted revenues) 69% 61% 64% 56%
     
    Adjusted gross margin (adjusted revenues minus adjusted COGS)$370.6 $215.9 $960.6 $574.8 
    Adjusted gross margin % (adjusted gross margin divided by adjusted revenues) 69% 64% 67% 58%
                 

    Reconciliation of Net Research and Development Expenses

    (in millions)Three Months Ended December 31,
     2020  2019 % Change
    Research and Development Expenses$59.5 $62.8 (5)%
    Adjustments:
    Less: Contracts and Grants Revenue 43.0  24.1 78%
    Less: Impairment of IPR&D   12.0 *
    Net Research and Development Expenses 16.5  26.7 (38)%
    Adjusted Revenue (Total Revenue less Contracts and Grants Revenue)$540.0 $336.3 61%
    Net R&D as % of Adjusted Revenue (Net R&D Margin) 3% 8%(63)%
             



    (in millions)Year Ended December 31,
     2020  2019 % Change
    Research and Development Expenses$234.5 $226.2 4%
    Adjustments:
    Less: Contracts and Grants Revenue 115.1  122.5 (6)%
    Less: Impairment of IPR&D 29.0  12.0 *
    Net Research and Development Expenses 90.4  91.7 (1)%
    Adjusted Revenue (Total Revenue less Contracts and Grants Revenue)$1,440.3 $983.5 46%
    Net R&D as % of Adjusted Revenue (Net R&D Margin) 6% 9%(33)%
             


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