Emergent looks to buy Maryland lab

Emergent BioSolutions Inc. hopes to ramp up production of its anthrax vaccine in Lansing.

he Rockville, Md.-based company said Thursday it plans to sell two unused buildings and purchase a manufacturing facility and laboratory in Maryland.

The pending moves could free up space in Lansing for additional production of BioThrax, the only federally approved anthrax vaccine.

"From a strategic perspective, the new Maryland manufacturing facility broadens our options," CEO Fuad El-Hibri said. Terms of the deals were not disclosed.

Nearly 400 employees work for Emergent in Lansing. About 30 have been hired since the company announced plans to add up to 93 new hires as part of an expansion announced in March that included state tax incentives.

Emergent hopes to ramp up the nation's stockpile of doses for use in case of a biological terrorist attack.

"The government has previously stated they want a stockpile of at least 75 million doses. Our calculations would show the stockpile is way short of that," Chief Financial Officer Don Elsey said.

He wouldn't provide details on the stockpile's shortfall, but said the Department of Defense also draws from the supply.

Emergent currently makes the anthrax vaccine in a Lansing facility with a capacity for roughly 7 million doses a year, Elsey said.

In September, the company will start producing 14.5 million doses as part of a $405 million government contract for the national drug stockpile. It will take two years to complete the contract.

A new $75 million large-scale manufacturing plant in Lansing could handle an additional 30 million doses a year.

The building, completed last year, originally was slated to produce the next-generation anthrax vaccine once it received government approval. But Emergent now is proposing production of the new vaccine be moved to the new Maryland facility, allowing Lansing to make more BioThrax - something that also needs a government OK.

"We have shared with the government our thoughts on this and the new capabilities that this will bring and they are considering it," Elsey said. "It's definitely not something that's firm yet."

Emergent BioSolutions Inc. Company Profile

Emergent BioSolutions protects your thorax against anthrax. Emergent BioSolutions develops and produces, for government and commercial markets, drugs that treat or protect against infectious diseases and bio-agents. The company supplies BioThrax (the US’s only FDA-approved anthrax vaccine) primarily to the departments of Defense and Health and Human Services (HHS). Its biodefense unit is also developing a post-exposure treatment for anthrax and a preventive vaccine for botulinum toxin. For commercial markets, Emergent is working on therapies and vaccines for typhoid, Group B strep, and hepatitis B, among other things. Chairman and CEO Fuad El-Hibri controls more than half of the company.

EMERGENT BIOSOLUTIONS’ TYPHOID VACCINE CANDIDATE ACHIEVES ENDPOINTS IN PHASE II CLINICAL STUDY

Vaccine well tolerated and immunogenic in double-blind, placebo-controlled study in pediatric population

ROCKVILLE, MD, October 10, 2007— Emergent BioSolutions Inc. (NYSE: EBS) announced today that preliminary results from a recently completed, randomized, placebo-controlled Phase II clinical study demonstrated that its single-dose, drinkable typhoid vaccine candidate achieved the study endpoints for safety and immunogenicity. In this clinical study, which recruited children between 5 and 14 years of age, a total of 101 children received the vaccine candidate and 50 children received placebo. The vaccine candidate and placebo were allocated in a blinded manner. This clinical study, which was conducted in Viet Nam, is the first study of this product candidate in a pediatric population in a region in which typhoid is endemic and was performed in collaboration with Oxford University and the Hospital for Tropical Diseases, Ho Chi Minh City, Viet Nam, and financially supported by the Wellcome Trust.

The data from this Phase II clinical study, which is still being analyzed, support the following key findings:

• The vaccine was immunogenic and met the predefined criterion of an overall immune response rate of greater than 50%, with 95% confidence.
• The vaccine induced significantly higher antibody concentrations, indicative of systemic responses, in children in the vaccine group compared to the placebo control group.
• The vaccine was well tolerated with no serious adverse events or deaths reported, and no subjects withdrew due to adverse events.
• Overall, there were no statistical differences in the incidence of adverse events between the vaccinated and placebo treated groups.

“We are very pleased to have met the objectives of this Phase II study of our typhoid vaccine candidate. This data is encouraging and indicates great promise for what would be the first single-dose, drinkable typhoid vaccine. We are particularly grateful to the Wellcome Trust for their partnership and generous support of this important project,” stated Fuad El-Hibri, chairman and chief executive officer of Emergent BioSolutions. “Typhoid is endemic in many developing countries, putting countless international travelers and families who visit these nations at risk. With typhoid claiming 200,000 lives each year, continued progress in the development of this vaccine is an important milestone in our company’s efforts to protect life. Emergent BioSolutions remains committed to addressing significant underserved health needs,” he continued.

About the Typhoid Vaccine Candidate

The company’s typhoid vaccine candidate is a live, attenuated strain of the Salmonella typhivaccines. bacterium designed to eliminate virulence by deletion of two specific genes. The vaccine is intended to be administered in a single, drinkable dose prior to travel to countries where typhoid is endemic. If approved, this method of administration could provide a competitive advantage compared to currently approved typhoid

Previously published studies have shown the vaccine candidate to be immunogenic and well-tolerated. In addition to this Phase II clinical study, the following clinical trials have been completed:

• An open-label, non-placebo controlled, pilot study conducted in the United Kingdom in healthy adults in which the vaccine candidate was well tolerated and immunogenic, eliciting both cell mediated and humoral immunogenicity.
• A double-blind, placebo controlled, single dose, dose escalating clinical trial conducted in the United States in which 100% of the trial participants in the highest dose group and 56% of the participants in the lowest dose group had an immune response on the scheduled testing days.
• An open-label, controlled, single dose clinical trial conducted in the United States in healthy adults to evaluate the safety and immunogenicity of two different presentations of the vaccine. The vaccine candidate was similarly immunogenic in both presentations and both were well tolerated.
• A single-blind, placebo controlled clinical trial in Viet Nam in healthy adults. The Wellcome Trust provided funding for the trial. The vaccine met the criterion for immunogenicity and was well tolerated, with no serious adverse events reported.

About Typhoid

Typhoid, also known as typhoid fever, is caused by infection with the bacterium Salmonella typhi. Typhoid is characterized by fever, headache, constipation, malaise, stomach pains, anorexia and myalgia. Severe cases of typhoid can result in confusion, delirium, intestinal perforation and death. Typhoid is transmitted by consuming contaminated food or drinks. Contamination usually results from poor hygiene and sanitation. Typhoid is often endemic in developing countries in which there is limited access to treated water supplies and sanitation.

An estimated 22 million cases of typhoid occur per year worldwide. The Centers for Disease Control (CDC) recommends that all persons from the United States traveling to developing countries consider receiving a typhoid vaccination, with travelers to Asia, Africa and Latin America deemed to be especially at risk. U.S. military personnel deployed in these areas are also at risk of infection.

About Emergent BioSolutions Inc.

Emergent BioSolutions Inc. is a biopharmaceutical company dedicated to one simple mission — to protect life. We develop, manufacture and commercialize immunobiotics, consisting of vaccines and therapeutics that assist the body’s immune system to prevent or treat disease. Our biodefense business focuses on immunobiotics for use against biological agents that are potential weapons of bioterrorism and biowarfare. Our marketed product, BioThrax® (Anthrax Vaccine Adsorbed), is the only vaccine approved by the U.S. Food and Drug Administration for the prevention of anthrax disease. Our commercial business focuses on immunobiotics for use against infectious diseases and other medical conditions that have resulted in significant unmet or underserved public health needs. More information on the company is available 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, prospects, plans and objectives of management, including clinical trial results and development plans, 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 the rate and degree of market acceptance and clinical utility of our products; our ongoing and planned development programs, preclinical studies and clinical trials, including future clinical data for our typhoid vaccine candidate; 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 product candidates; our commercialization, marketing and manufacturing capabilities and strategy; our intellectual property portfolio; 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 June 30, 2007 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.

Fuad El-Hibri on CorridorInc

Fuad El-Hibri, chairman and chief executive officer at Emergent BioSolutions Inc., is a finalist for the Ernst & Young Entrepreneur of the Year® 2009 Award in the Greater Washington region. The awards program recognizes extraordinary innovation, financial performance and personal commitment to a businesses and its community. Emergent BioSolutions, based in Rockville, is a biopharmaceutical company focused on the development, manufacture and commercialization of immunobiotics.

Severance and Termination Protection Program

Notwithstanding anything to the contrary in Exhibit I to the August 9, 2006 Letter from Emergent BioSolutions Inc. (the “Company”) to Fuad El-Hibri, Mr. El-Hibri and the Company hereby acknowledge and agree as follows:

1. The Company acknowledges that Mr. El-Hibri is a member of the board of trustees of American University, a member of the board of directors of the International BioMedical Research Alliance, and director and treasurer of the El-Hibri Charitable Foundation; that Mr. El-Hibri also serves as a director and/or officer of Digicel Holdings, Ltd., Telectronics, Inc., East West Resources Corporation, Intervac LLC, and Intervac Management LLC; and that Mr. El-Hibri manages certain of his own personal investments, including real estate holding companies. The Company agrees that Mr. El-Hibri’s service in such capacities has not interfered with his ability to perform his duties to the Company and, assuming continued service in such capacities at levels of time and attention comparable to those that Mr. El-Hibri has provided to such entities within the preceding twelve months, would not violate Exhibit I or interfere with Mr. El-Hibri’s ability to perform his duties to the Company.

2. It shall not be a violation of Exhibit I for Mr. El-Hibri to pursue any business transaction or opportunity where such transaction or opportunity was first presented (i) to Mr. El-Hibri in his capacity as an officer or director of the entities identified in Paragraph 1, above or (ii) to the Company, and the Board of Directors of the Company declined to pursue such transaction or opportunity.

3. With respect to Mauro Gibellini, Jose Ochoa, and Kerry Kisling, three employees who, at Mr. El-Hibri’s invitation, left their employment with East West Resources Corporation (EWR) to accept employment with the Company, it shall not be a violation of Exhibit I for Mr. El-Hibri to induce, counsel, advise, solicit or encourage, or attempt to induce, counsel, advise, solicit or encourage those employees to return to employment with EWR