Emergent buying & selling facilities

By Nick Taylor

- Last updated on GMT

Related tags Emergent biosolutions Us

Emergent BioSolutions believes it can reduce its debt, cut operating expenses and gain more flexible production capacity by reorganising its manufacturing operations.

The company plans to bolster its production and development infrastructure by acquiring two facilities. To finance this action Emergent will sell two of its existing sites in Frederick, Maryland US and expects this to ensure the transaction is cash positive.

Emergent acquired the 145,000 square feet sites in Frederick in 2004 and 2006 but significant improvements are needed to make the facilities suitable for its rPA production requirements.

rPA is an anthrax vaccine and Emergent believes it will be benefit from being able to offer the US government multiple production facilities. Emergent already has a site in Maryland capable of manufacturing rPA and this will soon be supported by another facility in the state.

The new facility has several suites suitable for current good manufacturing practice (cGMP) compliant production of multiple therapeutics. Furthermore, the facility has capacity for process development and administrative space.

By manufacturing rPA at this new site, which Emergent is acquiring from a contract manufacturing organisation (CMO), the company will be able to perform BioThrax scale up at its existing facility in Lansing, Maryland.

Furthermore, Emergent is acquiring a development facility in Gaithersburg, Maryland. This site has capacity for product, process and assay development, as well as administrative space.

BioThrax drives Q2 growth

In Q2 Emergent’s operating income grew by 788 per cent to $22.7m (€16m). This growth is underpinned by increased sales of BioThrax, which is the only anthrax vaccine approved by the US Food and Drug Administration (FDA).

Emergent is contracted to produce BioThrax in the US for the national stockpile and this will generate a further $405m over the next two years. Beyond this Emergent anticipates that the US will continue to purchase BioThrax for the strategic national stockpile.

Revenues in the quarter grew by 68 per cent to $73.2m. Some of this growth can be attributed to a lump sum payment from the US Department of Health and Human Services (HHS).

This payment was made because the FDA granted Emergent a four-year expiry dating for BioThrax.

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