After a tough and uncertain third quarter for Emergent BioSolutions, the Gaithersburg, Maryland-based company has slashed its 2022 financial guidance.
During the quarter, the company suffered from an FDA warning letter and uncertainty over its government contracts. All told, the company posted third-quarter revenues of $240 million, a 27% drop from the same period last year.
Emergent's profit remains "pressured" by "underutilization of our CDMO capacity," Chief Financial Officer Rich Lindahl said on a conference call.
After the performance, Emergent cut more than $100 million from its 2022 revenue forecast. The company now projects $1.05 billion to $1.1 billion in 2022 sales, down from a prior range of $1.15 billion to $1.25 billion.
As for the warning letter, the FDA in August flagged the company's Camden, Maryland, fill-finish cite, detailing contamination issues and a lack of written procedures designed to prevent contamination.
Meanwhile, another potential hurdle facing Emergent is the company's 10-year government contract for its smallpox vaccine, ACAM2000. While the company remains in “active discussion” with the government and believes that U.S. remains “committed to its prior smallpox preparedness strategy,” the government hasn't exercised a new option to procure the vaccine, Lindahl said.
The possibility of another order this year is “difficult to predict,” CEO Bob Kramer said on the call.
As for other Emergent products, naloxone revenues crashed 34% to $87.9 million after a generic to the overdose drug launched in the U.S. Revenues from Emergent's anthrax vaccines grew 55% to $24.2 million.