Emergent secures $250m US medical countermeasure contracts

Emergent BioSolutions has received substantial contract modifications totaling over $250 million from the US Department of Health and Human Services (HHS) to supply millions of doses of four vital medical countermeasures (MCMs). These modifications are part of the company's ongoing ten-year agreements with HHS, specifically through the Administration for Strategic Preparedness and Response (ASPR).

ASPR has amended existing contracts with Emergent to ensure the continued availability and stockpiling of critical MCMs to address biological threats and emergencies, including those related to anthrax, smallpox, and botulism. The modifications focus on two key MCMs: Cyfendus and ACAM2000. Cyfendus is an adjuvanted anthrax post-exposure prophylaxis vaccine, and the contract for it is valued at $30 million. ACAM2000, a live smallpox vaccine, has a contract modification worth $99.9 million.

Additionally, Emergent has secured two new contract options for VIGIV (vaccinia immune globulin intravenous) and BAT (botulism antitoxin heptavalent). VIGIV is used to treat complications arising from smallpox vaccination, while BAT is a treatment for symptomatic botulism. These new contract options are valued at $122.9 million and fall under the same ten-year contracts with ASPR.

The increased supply of vaccines can be partly attributed to the rise in smallpox and mpox cases over the past year, leading to heightened demand for these vaccines across multiple countries as a part of their public health preparedness measures.

In the wake of this news, Emergent's stock experienced a modest rise, closing up by 6% on July 2 compared to the previous day. As of that date, the company's market capitalization was $392.49 million.

This development follows closely on the heels of Emergent's recent cost-saving initiatives, which included laying off around 300 employees and eliminating approximately 85 positions. These measures are part of the company's strategy to focus exclusively on its medical countermeasures and Narcan operations.

Emergent has a history of securing significant contracts with government agencies for a range of vaccines and therapeutics aimed at combating infectious diseases. Earlier this year, in January, the company signed a $235.8 million contract with the US Department of Defense to supply Cyfendus.

Cyfendus is an anthrax vaccine that includes an adjuvant to enhance its efficacy. The US Food and Drug Administration (FDA) approved it in 2023 for post-exposure prophylaxis use in adults aged 18 to 65. The vaccine is designed to be administered in conjunction with FDA-recommended antibacterial drugs.

In August 2023, Emergent signed a ten-year contract worth up to $704 million to develop Ebanga (ansuvimab-zykl) for the Biomedical Advanced Research and Development Authority (BARDA), a division of ASPR. Ebanga is a monoclonal antibody approved by the FDA in 2020 for treating Ebola virus disease.

These various contracts and agreements underscore Emergent's pivotal role in providing essential medical countermeasures to address public health threats and emergencies. The company's strategic focus on securing long-term government contracts ensures the continued availability of critical vaccines and therapeutics.