UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
____________________
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
Date of
report (Date of earliest event reported): March 4, 2010
Emergent
BioSolutions Inc.
(Exact
Name of Registrant as Specified in Charter)
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Delaware
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001-33137
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14-1902018
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(State
or Other Jurisdiction
of
Incorporation)
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(Commission
File
Number)
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(IRS
Employer
Identification
No.)
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2273
Research Boulevard, Suite 400, Rockville, Maryland
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20850
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(Address
of Principal Executive Offices)
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(Zip
Code)
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Registrant’s
telephone number, including area code: (301) 795-1800
Not
applicable
(Former
Name or Former Address, if Changed Since Last Report)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item
2.02. Results
of Operations and Financial Condition.
On March
4, 2010, Emergent BioSolutions Inc. (the “Company”) announced financial and
operating results for the year ended December 31, 2009. The full text of the
press release issued in connection with the announcement is attached as Exhibit
99.1 to this Current Report on Form 8-K.
The
information in Item 2.02 of this Form 8-K, including Exhibit 99.1 hereto, shall
not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act
of 1934, as amended (the “Exchange Act”), or otherwise subject to the
liabilities of that section, nor shall it be deemed incorporated by reference in
any filing under the Securities Act of 1933, as amended, or the Exchange Act,
except as expressly set forth by specific reference in such a filing.
Item
9.01 Financial Statements and
Exhibits.
(d) Exhibits
See
Exhibit Index attached hereto.
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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Date: March
04, 2010
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EMERGENT
BIOSOLUTIONS INC.
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|
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By:
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/s/ R. Don
Elsey_____________
R.
Don Elsey
Chief
Financial Officer
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EXHIBIT 99.1
FOR
IMMEDIATE RELEASE
Investors
Contact:
Robert G.
Burrows
Vice
President, Investor Relations
301-795-1877
BurrowsR@ebsi.com
Media
Contact:
Tracey
Schmitt
Vice
President, Corporate Communications
301-795-1800
SchmittT@ebsi.com
EMERGENT
BIOSOLUTIONS REPORTS FINANCIAL RESULTS FOR FULL YEAR 2009
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·
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2009
record revenues of $234.8 million
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·
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2009
net income of $31.1 million, or $1.02 per share, representing eighth
consecutive year of profitability
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·
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2009
cash and accounts receivable balance of $157.8 million, including $102.9
million of cash and $54.9 million of accounts
receivable
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·
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2010
forecast anticipates total revenues of $235 to $255 million and net income
of $20 to $30 million
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ROCKVILLE, MD, March 4,
2010—Emergent BioSolutions Inc. (NYSE: EBS) announced today its financial
results for the full year ended December 31, 2009.
For the
full year 2009, total revenues were $234.8 million as compared to $178.6 million
in 2008, and net income was $31.1 million, or $1.02 per share, as compared to
$20.7 million, or $0.69 per share, in 2008. The 2009 performance was
primarily driven by sales of BioThrax®
(Anthrax Vaccine Adsorbed), the company’s FDA licensed vaccine for the
prevention of anthrax disease, including $34.0 million related to the approval
of four-year expiry dating for BioThrax®.
For the
fourth quarter 2009, total revenues were $53.8 million as compared to $35.8
million in 2008, and net income was $4.2 million, or $0.14 per share, as
compared to net income of $1.5 million, or $0.05 per share in 2008.
R. Don
Elsey, chief financial officer of Emergent BioSolutions, stated, “Our 2009
financial performance reflects our continued success in growing revenue from the
sale of BioThrax® under
multi-year procurement contracts with the US government while managing our
expenditures. We expect to continue these trends in the current year,
as evidenced by our forecast for 2010 of total revenues of $235 to $255 million
and net income of $20 to $30 million.”
2009 Key Operational
Accomplishments
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·
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Received
FDA approval extending shelf life of BioThrax®
to 4 years, triggering a $34.0 million payment from
HHS;
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·
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Received
FDA approval to amend the BioThrax®
license, providing for an intramuscular route of administration and a
reduction in the dosing schedule to five doses over 18 months—an
initiative supported and funded by the U.S. Centers for Disease Control
and Prevention (CDC);
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·
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Received
market authorization for BioThrax®
in India;
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·
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Commenced
what we expect will be the only clinical trial of the company’s polyclonal
anthrax immune globulin (AIG) candidate for treating anthrax
disease;
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·
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Obtained
Fast Track designation and Orphan Drug status from FDA and Orphan Drug
status from EMEA for the company’s AIG
candidate;
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·
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Secured
a NIAID grant to fund development of a third-generation anthrax vaccine
candidate, valued at $4.9 million over a two-year
period;
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·
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Initiated
a Phase IIb field efficacy trial in South Africa for the Company’s
advanced TB vaccine candidate, largely funded by The Aeras Global TB
Vaccine Foundation and the Wellcome
Trust;
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·
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Completed
a Phase IIb clinical trial of TyphellaTM
which demonstrated safety and immunogenicity of this typhoid vaccine
product candidate in healthy subject in the
U.S.;
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·
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Purchased
a 56,000 square foot manufacturing facility in Baltimore, MD., which
houses five independent manufacturing suites flexibly designed to support
the production of both clinical and commercial materials for the Company’s
growing product pipeline, for a total purchase price of $8.2
million;
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·
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Purchased
a 48,000 square foot product development facility in Gaithersburg, MD.,
that the Company previously leased, for a total purchase price of $6.4
million;
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Resumed
scale-up of BioThrax®
in the Company’s large-scale manufacturing facility (Building 55) in
Lansing, MI.; and
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·
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Submitted
a proposal to HHS, in response to a request, for funding the completion of
the manufacturing scale-up of BioThrax®
in Building 55.
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2009 Key Financial
Results
Product
Sales
For 2009,
product sales were $217.2 million, an increase of $48.0 million, or 28 percent,
from $169.1 million in 2008, primarily due to payments from HHS of approximately
$34.0 million related to the approval of four-year expiry dating for
BioThrax®,
obtained in June 2009, coupled with an 8 percent increase in doses sold in
2009. Product sales revenues in 2009 consisted of BioThrax® sales
to HHS of $216.4 million and aggregate international and other sales of $0.7
million.
Contracts
and Grants Revenues
For 2009,
contracts and grants revenue was $17.6 million, an increase of $8.2 million, or
87 percent, from $9.4 million in 2008. Contracts and grants revenue
for 2009 primarily consisted of development contract revenue from NIAID and
BARDA.
Cost
of Product Sales
For 2009,
cost of product sales was $46.3 million, an increase of $12.2 million, or 36
percent, from $34.1 million in 2008. This increase was attributable
to the 8 percent increase in BioThrax® doses
sold and an increase in the average cost per dose sold associated with reduced
production yield in the period during which the doses sold were
produced.
Research
and Development
For 2009,
research and development expenses were $74.6 million, an increase of $15.1
million, or 25 percent, from $59.5 million in 2008. This increase
reflects higher contract service costs, and includes increased expenses of $16.6
million on product candidates in our biodefense programs, primarily
BioThrax®
extensions and enhancements and our other anthrax-related product candidates,
decreased expenses of $7.1 million related to our commercial product candidates,
and increased expenses of $5.7 million in other research and development, which
are in support of technology platforms and central R&D
activities.
Selling,
General and Administrative
For 2009,
selling, general and administrative expenses were $73.8 million, an increase of
$18.7 million, or 34 percent, from $55.1 million in 2008. This
increase includes approximately $5.0 million in increased litigation services
and other professional services, a $7.3 million non-cash charge associated with
our Frederick, Maryland facilities, and a $1.4 million non-cash charge
associated with acquisitions that were in progress but not completed as of
December 31, 2008, as well as increased personnel costs related to the growth of
the Company.
Financial
Condition and Liquidity
Cash and
cash equivalents at December 31, 2009 was $102.9 million compared to $91.5
million at December 31, 2008. Additionally, at December 31, 2009, the
accounts receivable balance was $54.9 million, which is comprised primarily of
an unpaid balance consists primarily of amounts due related to shipments of
BioThrax®
received and accepted by the US government in the fourth quarter of
2009.
2010
Forecast
For 2010,
the Company is reaffirming its financial forecast of total revenues of $235 to
$255 million and net income of $20 to $30 million.
2010
total revenue is expected to be driven by, among other things:
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·
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the
continuation of deliveries of BioThrax®
under the current multi-year procurement contract with
CDC;
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·
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an
increase in the performance of work under development contracts with the
U.S. government with respect to the Company’s BioThrax®
related programs, anthrax immune globulin therapeutic candidate, and
anthrax monoclonal antibody
candidate;
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·
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additional
sales of BioThrax®
to allied foreign governments; and
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work
performed under an expected development contract with the U.S. government
related to the Company’s rPA vaccine
candidate.
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Conference Call and
Webcast
Company
management will host a conference call at 5:00 pm Eastern on March 4, 2010 to
discuss the financial results for the full twelve months of 2009, recent
business developments and the forecast for 2010. The conference call
will be accessible by dialing 888/680-0893 or 617/213-4859 (international)
and providing passcode 15824424. A webcast
of the conference call will be accessible from the Company’s website at www.emergentbiosolutions.com,
under “Investors”.
A replay
of the conference call will be accessible, approximately one hour following the
conclusion of the call, by dialing 888/286-8010 or 617/801-6888 and using the
passcode 94837956. The replay will be available through March
18. The webcast will be archived on the Company’s website, www.emergentbiosolutions.com,
under “Investors”.
About
Emergent BioSolutions Inc.
Emergent
BioSolutions Inc. is a biopharmaceutical company focused on the development,
manufacture and commercialization of vaccines and therapeutics that assist the
body’s immune system to prevent or treat disease. Emergent’s marketed
product, BioThrax®
(Anthrax Vaccine Adsorbed), is the only vaccine approved by the U.S. Food and
Drug Administration for the prevention of anthrax
infection. Emergent’s product pipeline targets infectious diseases
and includes programs focused on anthrax, tuberculosis, typhoid, flu and
chlamydia. Additional information may be found at www.emergentbiosolutions.com.
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 our strategy,
future operations, future financial position, future revenues, projected costs,
prospects, plans and objectives of management, including any potential future
securities offering, our expected revenue growth and net earnings for 2010, and
any other statements containing the words “believes”, “expects”, “anticipates”,
“plans”, “estimates” and similar expressions, are forward-looking statements.
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 appropriations for BioThrax®
procurement; our ability to obtain new BioThrax® sales
contracts; our plans to pursue label expansions and improvements for
BioThrax®; our
ability to win a development award with the U.S. government for our recombinant
protective antigen anthrax vaccine candidate; our plans to expand our
manufacturing facilities and capabilities; the rate and degree of market
acceptance and clinical utility of our products; the success of our ongoing and
planned development programs, preclinical studies and clinical trials; our
ability to identify and acquire or in license products and product candidates
that satisfy our selection criteria; the potential benefits of our existing
collaboration agreements and our ability to enter into selective additional
collaboration arrangements; the timing of and our ability to obtain and maintain
regulatory approvals for our other product candidates; our commercialization,
marketing and manufacturing capabilities and strategy; our estimates regarding
expenses, future revenue, capital requirements and needs for additional
financing; and other factors identified in the company’s Quarterly Report on
Form 10-Q for the quarter ended September 30, 2009 and subsequent reports filed
with the SEC. The company disclaims any intention or obligation to update any
forward-looking statements as a result of developments occurring after the date
of this press release.
Financial Statements
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