Core Viewpoint - Emergent BioSolutions Inc. recognizes the U.S. House of Representatives for adding over-the-counter naloxone to AED locations, enhancing access for first responders during opioid overdose emergencies [1][3] Group 1: Company Initiatives - Emergent is focused on expanding access to life-saving treatments like NARCAN Nasal Spray and KLOXXADO Nasal Spray to combat opioid overdose deaths [2][3] - The company has distributed over 85 million doses of NARCAN Nasal Spray in the U.S. and Canada since 2016, positioning itself as the leading supplier of nasal naloxone in the U.S. [3] Group 2: Legislative Support - Representative Buddy Carter's efforts to make naloxone readily available in the U.S. House of Representatives are acknowledged as a significant public health initiative [1][3] - The over-the-counter availability of naloxone is believed to have contributed to a reduction in overdose deaths, as reported by the U.S. Centers for Disease Control and Prevention [3] Group 3: Product Information - NARCAN Nasal Spray is the first FDA-approved over-the-counter naloxone product for emergency treatment of opioid overdose [5] - KLOXXADO Nasal Spray is a prescription medicine used for treating opioid emergencies and is not a substitute for emergency medical care [9]

Financial Data and Key Metrics Changes - Net income for Q1 2025 was $68 million, representing a 656% increase compared to Q1 2024 [17] - Total revenues were $222 million, down from the prior year due to lower NARCAN and VAC sales, partially offset by higher international smallpox sales [19] - Adjusted EBITDA was $78 million, an increase of $11 million year-over-year, with an adjusted EBITDA margin of 35%, up 1,300 basis points [20] - Adjusted gross margin improved to 58%, a 700 basis point increase year-over-year due to product mix and improved cost structure [20] Business Line Data and Key Metrics Changes - Medical countermeasure (MCM) products generated $91 million in sales outside the U.S. in Q1 2025, contributing significantly to overall revenue [19] - NARCAN sales experienced a decline due to pricing impacts and competition from generic products, but trends improved in the early weeks of Q2 2025 [22][23] - The company reaffirmed revenue and adjusted EBITDA guidance for 2025, focusing on core strengths in medical countermeasures and opioid overdose reversal treatments [10][27] Market Data and Key Metrics Changes - The company reported strong international sales, with approximately 40% of overall revenue coming from outside the U.S. [57] - The naloxone market is expected to grow at a mid-single-digit rate, with the public interest segment being the largest contributor [31][50] - A significant contract valued at $65 million was secured with the province of Ontario for NARCAN supply, indicating growth potential in Canada [34][51] Company Strategy and Development Direction - The company is focused on a multiyear turnaround plan aimed at stabilizing operations, improving profitability, and achieving sustainable growth [8] - Strategic business development transactions were completed to enhance core capabilities, including partnerships for medical countermeasures [10] - The company is actively managing its manufacturing footprint to mitigate tariff impacts and ensure compliance with USMCA [15][43] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, citing improved cash flow and liquidity, with total liquidity of $249 million as of Q1 2025 [24] - The company anticipates strong profit follow-through from 2024, despite lower top-line revenue, indicating a focus on margin improvement [28] - Management highlighted the importance of continued collaboration with government stakeholders to meet expectations for 2025 deliveries [13] Other Important Information - The company announced a $50 million share repurchase program, which will expire in March 2026 [26] - An annual ESG report for 2024 was published, emphasizing the company's commitment to quality and sustainability [29] Q&A Session Summary Question: Can you discuss your manufacturing footprint and tariff exposure? - The majority of products are manufactured in the U.S. or Canada, with limited tariff exposure due to USMCA compliance [42][43] Question: What drove the gross margin improvement this quarter? - Cost reductions from divestitures and a favorable product mix, particularly higher-margin international orders, contributed to gross margin improvement [45][46] Question: Were NARCAN dynamics considered in the Q1 revenue forecast? - Yes, the company anticipated some impacts from competition and federal funding delays, gaining clarity as the quarter progressed [47][48] Question: What is the expected growth for different segments in the naloxone market? - The public interest segment remains the largest, but business-to-business activities are expected to grow faster due to new initiatives [50][51] Question: How will the $65 million contract with Ontario be allocated? - It is reasonable to assume the revenue could come in fairly evenly over the three-year contract period [60] Question: Will the company benefit from pharmaceutical manufacturing onshoring? - The company is well-positioned with its manufacturing network and has capacity for drug substance and fill-finish, looking to assist companies transitioning back to the U.S. [61][62]

Financial Data and Key Metrics Changes - Net income for Q1 2025 was $68 million, representing a 656% increase compared to Q1 2024 [16] - Total revenues were $222 million, a decline from the previous year due to lower NARCAN and VAC sales, partially offset by higher international smallpox sales [18] - Adjusted EBITDA was $78 million, an increase of $11 million year-over-year, with an adjusted EBITDA margin of 35%, up 1,300 basis points [19] - Adjusted gross margin improved to 58%, a 700 basis point increase year-over-year due to product mix and improved cost structure [19] Business Line Data and Key Metrics Changes - Medical countermeasure (MCM) products generated $91 million in sales outside the U.S. in Q1 2025, contributing significantly to overall revenue [18] - NARCAN sales experienced a decline due to pricing impacts and competitive pressures, but trends improved in the early weeks of Q2 2025 [22][30] - The company reaffirmed revenue and adjusted EBITDA guidance for 2025, indicating confidence in operational performance despite revenue fluctuations [9][27] Market Data and Key Metrics Changes - International sales accounted for approximately 40% of total revenue in Q1 2025, highlighting the company's focus on global market expansion [56] - The naloxone market is expected to grow at a mid-single-digit rate, with the company emphasizing its competitive position in this segment [31][48] Company Strategy and Development Direction - The company is focused on a multiyear turnaround plan aimed at stabilizing operations, improving profitability, and achieving sustainable growth [7] - Strategic business development transactions were completed to enhance core capabilities, including partnerships for medical countermeasures [9] - The company is committed to combating the opioid overdose epidemic and expanding access to NARCAN through various distribution channels [11][33] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, citing improved cash positions and strong receivable collections expected in Q2 2025 [10][23] - The company anticipates strong profit follow-through from 2024, despite lower top-line revenue, indicating a focus on margin improvement [28] - Management highlighted the importance of international preparedness for medical countermeasures in light of global health threats [56] Other Important Information - The company has a total liquidity of $249 million, which includes cash and undrawn revolver capacity, providing a solid foundation for strategic growth initiatives [23] - A $50 million share repurchase program was announced, with no purchases made in Q1 2025, indicating a cautious approach to capital allocation [26] Q&A Session Summary Question: Can you discuss your manufacturing footprint and tariff exposure? - The majority of products are manufactured in the U.S. or Canada, with limited tariff exposure due to USMCA compliance [41] Question: What drove the gross margin improvement this quarter? - Cost reductions from divestitures and a favorable product mix, particularly from international orders, contributed to gross margin improvement [44][45] Question: Were NARCAN dynamics considered in the Q1 revenue forecast? - Yes, some impacts were anticipated, but clarity on the magnitude of competitive pressures improved over the quarter [46][47] Question: How do you see the naloxone market growing? - The market is expected to grow at a mid-single-digit rate, with public interest remaining the largest segment, but business-to-business activities are anticipated to grow faster [49][50] Question: Will the $65 million contract with Ontario be evenly distributed over three years? - It is reasonable to assume that revenue from the contract will be recognized fairly evenly over the three years [58] Question: Is the company likely to benefit from manufacturing onshoring? - The company is well-positioned with existing manufacturing capacity and is open to supporting companies transitioning back to the U.S. [60][61] Question: Has the company been actively repurchasing stock? - The company will provide updates on the share repurchase program each quarter, but no purchases were made in Q1 2025 [63]