Emergent BioSolutions Resumes BioThrax Manufacturing - Analyst Blog
Emergent BioSolutions Inc. EBS announced that it has completed its internal manufacturing investigation and resumed full manufacturing operations of BioThrax. The company also reaffirmed its 2015 financial outlook. BioThrax is approved for the prevention of anthrax infection.
The company was investigating its operations along with that of its suppliers and contract manufacturers after it discovered foreign particles in a limited number of vials in two manufactured lots of BioThrax earlier in the year.
Emergent BioSolutions said that it has identified a supplier component as the most probable root cause and is implementing certain targeted corrective and preventive actions in its own operations along with the operations of its suppliers and contract manufacturers. Also, the company said that there was no adverse impact on distribution or on any of its other products and manufacturing operations, including Building 55 operations and plans for licensure.
Reaffirms 2015 Outlook
The company still expects total revenues to be in the range of $510 million to $540 million in 2015 as compared to $450.1 million in 2014. Revenues, as per the Zacks Consensus Estimate, stand at $469 million. For 2015, BioThrax sales are expected in the range of $270–$285 million.
The company expects adjusted net income to be within $60 million to $70 million in 2015. In March, the company had dismissed its previously announced 2015 guidance stating that the suspension of BioThrax lots as well as the quarantined lots might affect its 2015 revenues by around $0 to $65 million.
Emergent BioSolutions also provided its guidance for the first quarter of 2015. The company expects total revenues in the range of $62 million to $64 million and net loss in the range of $21 million to $23 million. Revenues, as per the Zacks Consensus Estimate, stand at $53 million.
Our Take
The news came as a big relief to Emergent BioSolutions as BioThrax is its main product Emergent BioSolutions’ top line is largely dependent on BioThrax. Any negative outcome from the investigation could have impacted the stock. We expect investor focus to remain on BioThrax going forward.
Emergent BioSolutions carries a Zack Rank #3 (Hold). Some better-ranked stocks in the health care space include Biogen Inc. BIIB, AVEO Pharmaceuticals, Inc. AVEO and Horizon Pharma HZNP. All these stocks hold a Zacks Rank #1 (Strong Buy).
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