Biopharmaceutical company Emergent BioSolutions (NYSE:EBS) has won a $704 million 10-year contract from the Biomedical Advanced Research and Development Authority (BARDA) for advanced development, manufacturing ramp-up, and procurement of Ebanga (ansuvimab-zykl), a licensed treatment for Ebola virus disease. EBS shares rallied about 12% in Tuesday’s pre-market trading.
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BARDA is a U.S. Department of Health and Human Services (HHS) office that invests in novel approaches and technologies to develop vaccines, therapeutic products, and diagnostic tests required to respond to emerging medical threats.
Emergent Wins Ebola Treatment Deal
Under the terms of this contract, Emergent will advance the development of Ebanga through post-licensure commitments, including the transfer of technology as part of manufacturing expansion, submission of a supplemental Biologics License Application (BLA) to the U.S. Food and Drug Administration (FDA), and completion of stability studies.
The contract includes a base period of performance with two option periods (valued at nearly $121 million) focused on advanced development. Further, it comprises option periods (valued at up to $583 million) for the procurement of Ebanga over five years. This brings the total contract value to about $704 million if all option periods are exercised.
Last month, the U.S. Food and Drug Administration (FDA) approved Emergent’s anthrax vaccine Cyfendus. Interestingly, Emergent has been providing its Cyfendus vaccine to the U.S. Department of Health and Human Services since 2019, under a pre-Emergency Use Authorization status.
The company is scheduled to announce its second-quarter results on August 8. Following the dismal first-quarter performance, analysts expect the company’s loss per share to reduce to $0.63 from $0.86 in the prior-year quarter.
Is EBS a Good Stock to Buy?
Wall Street’s Moderate Buy consensus rating on Emergent BioSolutions stock is based on one Buy and one Hold. The average price target of $18.50 implies 169% upside potential from current levels. Shares were down 42% year-to-date as of Monday’s closing.
