Emergent BioSolutions at Wells Fargo Conference: Strategic Growth Insights

On Thursday, 04 September 2025, Emergent BioSolutions (NYSE:EBS) presented at the Wells Fargo 20th Annual Healthcare Conference. CEO Joe Papa outlined the company’s strategic focus on biodefense and opioid overdose treatments, emphasizing both the company’s financial recovery and future growth opportunities. While highlighting significant improvements in financial stability, he acknowledged ongoing challenges, including market competition and industry consolidation.

Key Takeaways

• Emergent BioSolutions has achieved a financial turnaround, with adjusted EBITDA rising from negative in 2023 to $183 million in 2024.
• The company reduced its net debt leverage significantly from 9.9x to 1.9x and improved its cash position from $70 million to $270 million.
• Focus areas include biodefense and Narcan, the leading brand for opioid overdose treatment.
• Strategic capital allocation is aimed at growth, debt repayment, and potential share repurchases.
• Emergent BioSolutions is exploring new product opportunities and international growth.

Financial Results

• 2024 Adjusted EBITDA reached $183 million, a substantial improvement from negative figures in 2023.
• Net debt leverage was reduced from 9.9x to 1.9x.
• Cash reserves increased to $270 million by June 30th, up from $70 million a year prior.
• Current revenue run rate is projected at $750-$800 million, with expected adjusted EBITDA of $175-$200 million.

Operational Updates

• The company streamlined its manufacturing network, consolidating operations into two main facilities in Lansing, Michigan, and Winnipeg, Canada.
• The Narcan Direct program was implemented, expanding distribution to 18,000 points to enhance product accessibility.

Future Outlook

• Emergent BioSolutions plans to grow through organic pipeline development and strategic business acquisitions, particularly in biodefense and opioid overdose treatment.
• The company is targeting additional products for U.S. and international governments and first responders.
• Capital allocation priorities include growth initiatives, debt repayment, and potential share buybacks.

Q&A Highlights

• Narcan maintains its leading market share despite competition, with expected market growth in the mid-single digits.
• The company secured seven biodefense contract modifications and sees strong government support for anthrax and smallpox preparedness.
• A new collaboration with Swiss Rockets focuses on next-generation virus vaccines, with NIH-funded projects expected to yield data by 2026 and 2027.
• Industry consolidation is anticipated, with potential roll-ups in infectious disease and related sectors.

For more detailed insights, readers are encouraged to refer to the full transcript.

Full transcript - Wells Fargo 20th Annual Healthcare Conference 2025:

Jason Ellis, Managing Director, Wells Fargo: Hello, and thank you all for coming, and welcome to the Emergent BioSolutions fireside chat here at the Wells Fargo Healthcare Conference. My name is Jason Ellis. I’m a Managing Director on our biopharma investment banking team, and it’s my pleasure to have with me today Joe Papa, Chief Executive Officer of Emergent BioSolutions. Joe, great to have you.

Joe Papa, Chief Executive Officer, Emergent BioSolutions: Thank you, Jason. Glad to be here with you. Good afternoon, everyone.

Jason Ellis, Managing Director, Wells Fargo: Great. Why don’t we start digging into some questions around the company?

There have clearly been a lot of changes around the margins of the business over the last few years. It seems fair to say the core of what Emergent BioSolutions is hasn’t really changed, but it would be great to just get some perspectives on, at a high level, what’s the real strategy of the business? What do you see as the core underlying value proposition that you guys are bringing to the market?

Joe Papa, Chief Executive Officer, Emergent BioSolutions: Sure. Emergent BioSolutions is a 25-year-old company. We focus on two main areas. The first one is in the area of what I refer to as biodefense. We have medical countermeasure products that are meant to take a look at solving public health crises before they happen. Clear examples of something like that are we make a smallpox vaccine, we make a smallpox therapeutic product, we make a therapeutic product for anthrax, and we make an anthrax vaccine. Some really difficult products to make. We make a botulism antitoxin. The U.S. government believes that smallpox, anthrax, and botulism are the number one threats in terms of a terrorist activity. We make the products for the U.S. government and governments around the world. That’s the first part of our business.

The second part of our business, and this is one that we’ve been at now for quite a few years, is we make Narcan. Narcan is the number one brand for opioid overdose treatment. It really is the gold standard of opioid overdose treatments, and we’re delighted to make that product. We believe it saves millions of lives as a result of what we do with our Narcan products. Those are the places that we predominantly. I think the thing I would comment about the products we make is that they have a very durable revenue stream. What do I mean by that? The product is really difficult to make—a smallpox vaccine. It’s a live attenuated virus vaccine.

I can pretty much assure you there’s no one going to the garage today and they’re going to sit there in the garage and say, "I’m going to make an equivalent smallpox vaccine." Not going to happen. You’re not going to have access to the smallpox. You’re not going to have access to anthrax spores. The U.S. government wants to obviously control those types of things. Unlikely somebody’s going to be developing that type of product. It gives you a very durable, sustainable revenue stream going forward, and that’s one of the things that we think is really important. One of the things that probably sets us apart that people don’t recognize is we make the product for the government, but we also do much of the testing for the U.S. government. We’re in the ecosystem of the U.S. government.

We make the product for them, we then ship the product to them, and then you need ongoing testing for the product to make sure it still has the same potency year after year. We do that. It keeps us in the ecosystem, keeps us knowledgeable in what they’re doing, what they’re looking for, and then importantly, as we get ready for the next product they may want going forward. Those are the things that we do to ensure that this is an ongoing part of our business. We also have other products, just to continue the theme. We make a product for Ebola. You may have seen today there were some news reports out of the Democratic Republic of the Congo that there are some incidents now showing up of Ebola. We make a product called Ebanga for the treatment of Ebola.

We’re trying to stay ahead of whatever the next outbreak could be with our products, and we’re excited about the things that stay the same, as we’re doing those types of things to ensure we help public health threats solve them around the world.

Jason Ellis, Managing Director, Wells Fargo: Great. That’s really helpful context. You mentioned the federal government a few times, so I think it’s just worth digging in a little bit more, just given a lot of the noise and activity that’s going on at a macro level, both domestically and internationally. Could you please just spend a few minutes on domestically how the environment around policy, pricing, tariffs, and regulatory dynamics are impacting the business? We’d love to hear internationally how some of the macro themes are affecting you as well.

Joe Papa, Chief Executive Officer, Emergent BioSolutions: Maybe I’ll start with a little bit of the bigger picture and get down to the specifics of the U.S. The first picture I think I have to paint is to recognize and make the comment that we live in an increasingly dangerous world. I mean, if you see what’s happening out there with China, with Russia, with North Korea, Iran, there are things happening out there that we have to constantly be on the lookout for, the U.S. government’s constantly on the lookout for. They’re looking for partnerships with a company like Emergent BioSolutions to ensure that we stay ahead. What do we do? We work really closely with the U.S. government. We agree on how we can do the research for product A. We’ll do that research. We’ll then seek the approval from the FDA.

Once we get the approval from the FDA, we’ll make the products for all the different agencies of the U.S. government, whether it be Department of Defense, whether it be BARDA, whether it be the Strategic National Stockpile. We make those products. We also make it for other allied country governments as well. We’re collaborating with them as well. That talks a little bit about the international side. As you relate to one of the comments you asked about, what’s happening here in the U.S. We’ve looked at this very closely. It’s obviously important. A brand new administration has come into the government. We’ve worked now over 25 years with many different new administrations. What I’d say is we’ve been down this road before.

We understand there’s going to be a little bit of turbulence initially, but once you get through the first six months, things continue to move forward as they normally would. What I would say is that there’s an increasing emphasis on the spending levels for defense, of which biodefense is part of that. That’s clearly important. The other area that I talked about, or Narcan, that is another area that we’re delighted to say we have bipartisan congressional support to let’s solve this opioid overdose problem. It’s not solved yet. We’ve made great progress. I’m delighted to say that from 2023, the opioid overdose death in total was around 100,000. In 2024, it came down to about 80,000. 80,000 is still a lot of people dying every year.

What we’re doing is I can’t directly attribute all that to Narcan going over the counter at the end of 2023, but I think that’s a big part of it. I would say that we’re going to continue to try to make Narcan more accessible. The more accessible we make it, we think that’ll be better for the government, better for everybody, and it will align with what’s going on in the new administration. The final area I want to say is one of the things that the U.S. government’s asked for and is something I’m delighted to say that we’re ahead of the curve. Because of the products we make, most of the products we make are made in the United States. That’s some of the issues of the U.S. government new administration. We’ll check that box.

We’re already making them here in the United States, or we’re making them in a USMCA compliant facility, which allows us to avoid some of the areas of tariff. Great news to your original question. We’ve got bipartisan support for both biodefense and for opioid overdose, and we are meeting many of the guidelines in terms of making it here in the U.S. and/or in a USMCA compliant facility. We’re already giving the U.S. government one of the best prices or the most favorite prices out there. I think we checked most of the boxes that the new administration is looking for, and we’re delighted to say we’re continuing to work with them and work with the same leaders in BARDA, Strategic National Stockpile, as we go forward.

Jason Ellis, Managing Director, Wells Fargo: Helpful. Maybe one quick follow-up. Just with the increasingly dangerous world internationally, do you think that has the potential to drive more of the allied countries to buy more smallpox, anthrax preparedness? Do you really see a correlation between that, or is it really kind of distinct?

Joe Papa, Chief Executive Officer, Emergent BioSolutions: No, I think you’re absolutely right in the way you phrased it. We see increasing concerns. We see that, for example, one first point, NATO, we now know, is going to move their expenditures on defense from 2% to 5%. That’s for defense in total, to be clear, but biodefense falls into that category. That’s clearly one of the areas. I think that’s certainly something, a tailwind for this whole category of the biodefense world. I think that that’s an important part of it. We already know that in Europe, for example, they’re looking to build a Strategic National Stockpile for the European Union, very similar to what we do here in the U.S. They actually are collaborating with the U.S. to think about how best to do that. I do think that they’re taking this very serious.

I don’t have all the intelligence that they have in terms of what’s going on in any of these countries, but I will tell you they’re taking it serious. They’re looking at what the opportunities are to get ahead of the curve so that they’re prepared for whatever threat comes across the board. Yes, taking it serious. For us, we want to be a good partner for all the countries as we go forward with this.

Jason Ellis, Managing Director, Wells Fargo: Great. Let’s dig in a little more now on just some of the business dynamics. The business is in the midst of a turnaround.

Joe Papa, Chief Executive Officer, Emergent BioSolutions: Yes.

Jason Ellis, Managing Director, Wells Fargo: You’ve set out a number of key objectives and initiatives that can affect the transformation. Can you just take us through an update on where you are along that journey? What work has been done since you set out with your leadership of the company?

Joe Papa, Chief Executive Officer, Emergent BioSolutions: Yeah. I joined in February of 2024, so I’m about 18 months in now. When I joined, we started a pathway, what I would call a turnaround process, that would be a multi-year turnaround process. We’re now in our second year. The first year was dedicated towards stabilizing the company. By stabilization, taking care of all the things that we needed in terms of improving operating reforms, reducing debt, looking at how we can extend the maturity of our debt, a lot of things that just needed to get done. My CFO, Rich, is here. He’s a big instrumental part of making all those things happen. We’ve been able to stabilize the company. I’m delighted to say if you look at where we were just a year ago to where we are today, we’ve made great improvements on the stabilization phase. Operating EBITDA performance in 2023 was actually negative.

This year, or I’m sorry, 2024 closed at about $183 million of adjusted EBITDA. A nice jump there. We had to take some important decisions, but we did that. We’ve streamlined the operating efficiency of the manufacturing network. We’ve sold some facilities off. We put two hub facilities in, one in Lansing, Michigan, the other one in Winnipeg, Canada. Those are the two main hubs that we operate from. By focusing on those two hub sites, it dramatically brought down our operating expense as well. We then extended the maturity of the debt I mentioned, and we brought down our total debt. Our net debt leverage today is about 1.9 times. A year ago, it was about 9.9 times. We’ve moved that debt leverage down. We moved it down by reducing debt. We moved it down by increasing operating performance. We’ve reduced our working capital that freed up some cash.

We took a multiple different ways approach to improve the overall operating performance of the business, and we’ve generated cash. Our cash position has moved from a year ago, it was about $70 million. In the second quarter, June 30th, we had about $270 million. Dramatic improvement in cash flow as well. We find ourselves in a much stronger position. Debt has been extended. Maturity has been extended. Debt has been reduced. Leverage is down from a net point of view. Good progress across many different of our financial parameters. Obviously, as we look forward, we look forward to what can we do now to grow the business? Where can we invest? That’s our next goal for what we’re looking for, the next step of our turnaround.

Jason Ellis, Managing Director, Wells Fargo: Would you say some of those triage measures are pretty much done at this point, and now you’re focused on growing the business going forward?

Joe Papa, Chief Executive Officer, Emergent BioSolutions: Absolutely, the way I phrase it, just to use simple numbers, is that what we’ve now created is what I would call a very efficient business. Our current run rate today is somewhere in the $750 to $800 million run rate. If I use $800 million, just to make my point, we’re about $800 million on the top line, and that will generate somewhere between $175 to $200 million of adjusted EBITDA. That’s our current forecast. You can see a very, very efficient business from the revenue side down to the adjusted EBITDA. That was what our goal is. Now, as we think about 2026 and beyond, it’s where can we grow that top line as we think about what additional products that we can either bring in organically through our own pipeline, products we already have today, or through business development is what we’re looking at for the future.

Jason Ellis, Managing Director, Wells Fargo: Got it. Let’s switch now to some of the key products and opportunities there. The Narcan business and the medical countermeasures business around anthrax, smallpox are clearly important components of the overall business. Could you just kind of give us an update on the key market dynamics around those two categories individually, Narcan, the puts and takes around there, the competition, and then separately on the countermeasures, more so in terms of how the government’s thinking about preparedness and contracting and advertising this?

Joe Papa, Chief Executive Officer, Emergent BioSolutions: Sure. Let me start with Narcan. What we see with Narcan is, number one, we’ve made a nice improvement in the number of deaths, but unfortunately, there’s still 80,000 in overdose deaths a year. We need to do more. Number two, we believe that Narcan, the brand, is the best, most widely regarded, widely known, and accepted brand to help these patients when, unfortunately, one of these patients gets into a problem. Narcan will work. We think that’s an important part of how we need to continue to make people understand how to use Narcan, make it more accessible, and those are the things that we’re doing. In our world, how we believe this is that every house in America, every first aid kit in America should have a Narcan in it because you never know when a patient or person may overdose.

It’s easy to say people shouldn’t experiment with drugs, but they do. Importantly, if one of those drugs happens to be tainted with fentanyl, they could be dead in four or five minutes. It’s important that Narcan is available. It’s important it’s available quickly. We have great first responders, but if they don’t get there in time, you can save a life if you have availability to Narcan. It’s a really simple thing to use. We want to make sure Narcan is more accessible, and that’s one of the things we’re doing. The other point I would say is that there’s been a number of large pharma opioid settlements and litigation and settlements where we believe about $50 billion is going to come in terms of the opioid litigation settlements for people that were making opioid products. Those funds are coming over the next 10 years.

We believe that that funding will be a great source of education and also the ability to fund more Narcan for accessibility or more naloxone for accessibility. We view that as another important tailwind for us relative to help save more lives. That’s really our core function is we’re out here with Narcan and where we function to save lives. Final point, just internally at Emergent, I’d say, is as we think about Narcan, what do we want to do? We want to make it easier for our customers, the first responders, to buy the product, get the product, and utilize the product. We’ve set up programs that no one else has. We’ve set up a program called Narcan Direct where we ship the product to 18,000 individual distribution points. By doing that, we believe it’ll be easier for the first responders to get access to our product.

We also help the states and local municipalities, county municipalities, to really understand how can they get funding for Narcan. In other words, where are those budgets in the state? Where are those budgets in the federal government that can help them to buy and procure Narcan and/or naloxone? We try to help them. If we help them, they will be able to have more naloxone available. If there’s more naloxone available, we will save lives. Those are the things that I think are probably some of the big pushes and pulls on trying to make Narcan more available and ultimately to save more lives.

Jason Ellis, Managing Director, Wells Fargo: Got it.

Joe Papa, Chief Executive Officer, Emergent BioSolutions: On the medical countermeasure or biodefense side, it’s along the lines of what I said before. We see bipartisan support for the need to fund the defense side. We see the support not just in the U.S. We see support for that in Europe. We see support for the Middle East. We clearly believe there’s going to be more demand for medical countermeasures, biodefense products. We want to be ready. We’ve got probably one of the biggest portfolios of products. I mentioned smallpox, both vaccine and therapeutic. I mentioned anthrax, vaccine and therapeutic. I mentioned botulism, anthrax toxins. We have a product for if someone gets in a problem with the vaccine. We’ve got a product called VIG. It’s an immunoglobulin product. We’ve got a product that is for Ebola, Ebonga. We’re probably one of the most diversified portfolios because we’ve been at it for 25 years.

I think that gives us a unique position to understand what’s happening out there, and most importantly, how can we help other countries around the world to get themselves prepared? One of the things we did as a company last year is we made a bigger investment in our international growth programs. By doing that, we felt we can get more resources into the other countries around the world to help them understand what capabilities we have and to talk to them about the regulatory factors and other factors to make sure the products are available in their country. That we think is going to help. It’s going to help potentially save lives.

Jason Ellis, Managing Director, Wells Fargo: Great. Maybe just a follow-up on the Narcan side. There’s been some competition that’s entered the market. What’s your expectation around that product going forward? Is it going to be a continued kind of cash flow driver? Do you expect to maintain significant share in that market? Just any dynamics around the competitive environment would be great.

Joe Papa, Chief Executive Officer, Emergent BioSolutions: Sure. Narcan, you’re 100% correct. Narcan faced some incremental competition last year, 2024. In the April-May timeframe, there was a new competitor that showed up for a nasal naloxone product. That has pretty much settled out. Narcan still is the number one leading product in the category. There are two other generics available, one from Amneal, one from a company called Padagis. Those products are available, but Narcan continues to hold the number one market share. We think about the future of what that means for Narcan. Our expectation is we’ll continue to hold the leading market share.

Our expectation is that this will additional funding for, because of the number of deaths that are already out there, plus the incremental education funding that’s coming in from the litigation settlement, are going to fuel an overall volume increase for the need for naloxone nasal sprays, but somewhere in the order of mid-single-digit type growth. We expect that we’ll participate in that growth along with the other players out there, and we’ll keep our share. That’s kind of the way we’re thinking about it. We think over the last, I’d say, six months, pricing has been relatively stable. There’s always going to be some variations on a monthly basis, but for the most part, pricing has been relatively stable. With increased volume demand, relatively stable pricing, our expectation is we’ll be able to grow Narcan in the future.

Jason Ellis, Managing Director, Wells Fargo: Very helpful. Maybe back to the countermeasure side a little bit. As of the Q2 earnings, you had secured seven biodefense contract modifications. I think it was just yesterday, the day before, we saw the company announce it was awarded $30 million contract modifications or siphoned us. Congratulations on that. Can you give us more context on what this signals in terms of the momentum for the broader anthrax franchise? Is there anything we can read into that?

Joe Papa, Chief Executive Officer, Emergent BioSolutions: Yeah, I think a couple of things. As it would relate to anthrax, as it relates to just our total business, our expectation is that we’re working very closely with the U.S. government, with members of BARDA, members of the Strategic National Stockpile, Department of Defense, and looking at their demand signals and what they’re looking to do. We have a regular quarterly meeting with them. One of the things as a newcomer, new CEO I started, was that we have a quarterly meeting with them just at the highest levels of BARDA, the highest levels of Department of Defense, and the Strategic National Stockpile just to understand what their needs are. Because as I said to them, I don’t want to think that you need 100 of something, you need 1,000. I don’t want to think you need 1,000, you need 100.

Let’s make sure we have good transparency between the U.S., the government, and ourselves. We do that on a regular basis and have good conversations. That helps us also understand what do they need beyond the existing products. We do that. We have a very good read into what they need for anthrax, back to your question. We have a good need for what they need for smallpox as well. We update them on our development progress, what we’re doing for, for example, the product Ebonga for Ebola. We want them to know where we are with that because you never know, like as I mentioned today, we’re seeing something showing up in the Democratic Republic of Congo. We want to make sure they know where we are with our capabilities in case something turns into from a local issue to a global issue. We share that kind of information.

We spend a lot of time with them making sure everyone’s aligned around where are we, what are we doing, and importantly, anticipate their needs so we can help save lives.

Jason Ellis, Managing Director, Wells Fargo: Great. Let’s move on to more kind of strategic initiatives. Earlier this year in March, you announced an agreement with Swiss Rockets to support research, infrastructure development, and expansion of their innovative biotechnology portfolio. Can you just spend a moment providing a little more color on what that agreement entails and what kind of opportunities it opens up for Emergent?

Joe Papa, Chief Executive Officer, Emergent BioSolutions: Certainly. Just for context setting for everyone, what we’re trying to do with Swiss Rockets is to set up an agreement with a company that has a platform for next-generation vaccines. One of the things you probably have read about in the press is that as the world took on COVID, we went to the mRNA technology. mRNA technology has a couple of attributes. One is that it’s fast. It’s fast development. The second one, though, is that the immune stimulant for it doesn’t tend to last in terms of the immunization long term. What we’re working on with RocketVax is a next-generation virus vaccine that is a live attenuated vaccine that you can develop quickly, but will allow for duration of the immunologic response. That’s what RocketVax is set to do. The first project we’re working on has already been funded by the NIH for the Phase One initiative.

We’re looking forward to participating with RocketVax on that and helping them to work through that process so that they’ll have a potential virus vaccine that’s live attenuated that will be quick to the market for any potential future virus outbreak, but one that would have long-lasting immunity. That’s the hypothesis we have with them, and we’re looking forward to working with them. It’s a perfect example of using our current expertise of working with the U.S. government, working through the FDA, the regulatory capabilities we have, and applying it to an interesting, promising technology and potentially collaborating with an important company like RocketVax or Swiss Rockets to make the difference. That’s what we’ve done so far. There are three additional products behind that one, but we focus predominantly on the first one because it’s already got U.S.

government NIH funding for the initial Phase One type of studies, and we hope to be able to show some good data on that starting in 2026 and 2027.

Jason Ellis, Managing Director, Wells Fargo: This is a much longer-term investment, something that will bear returns. Would you say in the five to ten-year timeframe, or is it as soon as that?

Joe Papa, Chief Executive Officer, Emergent BioSolutions: No, it’s probably in the five to ten-year timeframe. Importantly, the way I’ve always looked at portfolios is you have to have items that you’re going to launch very quickly, but you also have to be building for the future. This falls under more of the category of building in the future. We also did another business development deal in January that was more today. It was a product called Clocksado in the Narcan space. Our logic there was Clocksado was being marketed by HCMA. HCMA is a great company. They don’t have as much expertise in opioid overdose as we do. We said, let’s work together with HCMA, and we can do collaborative work on Clocksado. Clocksado is an 8 milligram naloxone product. The gold standard Narcan is a 4 milligram product. In some cases, you may need an 8 milligram product.

If you can hypothesize a patient who’s on a heavy dose of fentanyl, they may need more product, more naloxone on board as an example of somebody that you may need the Clocksado product for. We want to make sure that when first responders think about opioid overdose, they think about Emergent, and that Emergent can help them solve their problems. That’s really the customer focus. One of the things I mentioned at the onset, I’ll just repeat, is that we’ve tried to change Emergent to be a company that has all those great product attributes I talked about before, but one that’s more customer-focused, leaner, more flexible in how we approach the business. This customer focus is one we took on very seriously as we thought about licensing in Clocksado. How can we be a better partner for first responders?

We think bringing Clocksado into the portfolio, bringing our Narcan Direct shipments into the portfolio for Clocksado will make it easier for them to do business with us.

Jason Ellis, Managing Director, Wells Fargo: Very helpful. Let’s shift now to think about the future.

Joe Papa, Chief Executive Officer, Emergent BioSolutions: Yeah.

Jason Ellis, Managing Director, Wells Fargo: You’ve described your approach to capital allocation being focused on growth, debt repayment, and share purchases.

Joe Papa, Chief Executive Officer, Emergent BioSolutions: Yep.

Jason Ellis, Managing Director, Wells Fargo: On the growth side, you clearly have a government contracting capability that can be leveraged. You also have, you built out more of a retail capability with Narcan. When you think about growth opportunities, are either side more interesting in terms of bringing out more products that can be contracted or diversifying your customer base? How do you think about that in terms of growth opportunities?

Joe Papa, Chief Executive Officer, Emergent BioSolutions: Yeah, the way I simply try to answer that question is, how do I sell one more product to the U.S. and international governments around the world? If I could do that, the gross margin of those products drops my operating line because I’ve already got all the infrastructure set up in place. The same comment for first responders. How can I sell one more item to first responders? If I do, the gross margin of that product will drop my operating line because I don’t need any more distribution capability or anything. Those are the simplistic ways I’m looking at the strategy for what we’re doing. It’s very similar to the approach I’ve taken with the previous CEO roles I’ve had. That’s the simple way I view it.

With that as a mindset, it tells you that we’re looking for business development opportunities as to where can we find one more item, the next item the U.S. government needs, or governments around the world. If we can find that item, that will be a very logical strategic bolt-on for us. We’re looking at those bolt-ons right now. The good news is there’s a number of companies out there that are looking for funding. They’re looking for partners. We bring both the cash capabilities now that we’ve improved our operating cash flow, but we also bring expertise from a regulatory point of view, from a knowledge of how to work with BARDA, how to work with the Department of Defense. Those capabilities we can bring to smaller companies who may have one product in biodefense. We’ve got 10.

That gives us a capability of helping them be successful, either by working with them on a product, acquiring that product, or potentially acquiring the total business of the biodefense side of that company. Those are the ways we’ll look at that. I go back to your basic question. I’d say, first and foremost, it starts with our existing business today. How can I bring on one additional product for biodefense? How can I bring on one additional product for the areas of opioid overdose treatment? Those are where we’ll focus. We also are open to look to try to diversify the business beyond that. We’re open to considering other activities as well. We’ll look out and try to have more to say about that. Hopefully, we’re back together maybe a year from now or something. We’ll be able to talk more about those things.

Jason Ellis, Managing Director, Wells Fargo: Awesome. We’ve seen a couple of interesting transactions related to some of the spaces that you operate around. There’s an acquisition of Milenta, which is an anti-infectious hospital-focused product business. There was also an announcement of a take-private of Bavarian Nordic, a business that you, I’m sure, know well, given your sale of the travel health business. Do you think you’re starting to see a renewed focus on infectious disease and platforms that serve related markets, or are these kind of more one-off in nature?

Joe Papa, Chief Executive Officer, Emergent BioSolutions: I think in a general statement, there’s going to be more roll-ups of other companies that are in these spaces. I think from a logic point of view, I’ve seen a lot of different trends over my time in the healthcare pharma space. I think this is one that’s just sitting there, just very ripe for the next new roll-up of these businesses. Why do I say that? They’re great businesses, but the more diversified you can be with the business, the better off you’ll be. If you look at it, we’re amongst the most diversified, and we’ve got about 10 products as a part of our portfolio. If I had 20 products, I’d be even more diversified, right? I think we’re going to look to see how this plays out, but it is my expectation there’ll be more continuous rolling up of these product categories.

I think there’s an easy, logical model people can think about. What has happened to the defense industry? I’m talking about the military defense industry. It’s been rolled up. Instead of having 20 small suppliers to the U.S. government, there’s two, three. I think that’s exactly what will happen in this business for exactly similar reasons, maybe a little later in timing because this business is not as long duration as perhaps the other businesses of defense. I think it will get rolled up over time. It is my expectation that that’s going to be the theme you’ll see because we, back to the original, we’re in a very dangerous world. I think that there’s going to be spending here to be clear.

I think there’s people who are going to want to make sure that we can protect them and we put the resources available to do that and protect and save lives, which is really the theme of our company.

Jason Ellis, Managing Director, Wells Fargo: Great. We’ve got a few minutes left. Are there any questions from the audience? We can take those now. Maybe another one from my standpoint. When you think about potentially a consolidation of the industry or some of the industries that you’re focused on, do you think that presents more competition for assets? You’re obviously well-positioned to evaluate those. Do you think that you will be successful in getting more share of those assets than maybe some others?

Joe Papa, Chief Executive Officer, Emergent BioSolutions: Yeah, I think that we’re well-positioned. I think we’re going to be prudent in what prices we’ll pay for things. I do think that we’re well-positioned, and we’re positioned because of two things. Number one, our knowledge of the customer and what they’re looking for, what they need next. I think that helps a lot, and that knowledge helps not just in choosing to acquire product A or B, but it also helps in the pathway for how best to get the product ultimately to the marketplace if it’s in development, as an example. That expertise, I think, is something we can bring to the party. The second thing in my mind is not just the development side, but then the commercialization side and taking it global.

One of the things I mentioned earlier in my comments is that we have made a bigger investment in international, and that’s something we think is going to be important because we want to go back to Europe. I know Europe is going to try to build their own stockpile. I have confidence that the same thing is going to happen in some of the countries in the Middle East and Asia. I think that our international buildup is going to be able to help us to help those countries that need help.

It is the expertise on the product today that we can do it, but also the investment we’re making in international that’s going to give people the belief and the understanding that if I go work with Emergent BioSolutions, they can make this a relatively turnkey type of program that helps me get it developed, helps me get it to the market quickly, but then importantly helps to get to customers, not just to the United States, which is important, but to get it around the world. Those are the things that are going to help us as we think about the opportunity set in front of us. That’s why I’m excited because I think we have the ability to protect and save more lives, which is at the end of the day, the mission of our company.

Jason Ellis, Managing Director, Wells Fargo: Got it. Unless there’s anything else, maybe just one last question. When you think about the investment standpoint of Emergent BioSolutions and the value proposition that you bring to the table, what should investors really think about when they think about wanting to invest in this space and what value Emergent BioSolutions can drive long term? Why should that be such a compelling value proposition?

Joe Papa, Chief Executive Officer, Emergent BioSolutions: Sure. I think first and foremost, one of the things that we have is what I call this durable, sustainable product revenue over time. If you think about these products, as I mentioned, an anthrax vaccine, a smallpox vaccine, these are products that are going to be around for a long time. If this is important to the U.S. government, which, as I said, smallpox, anthrax, and botulinum toxins are the most important threats they manage, and we make something for all three of those, this is going to have durability because the products we made five years ago, great products, but they’re going to expire. They’re going to need to have the stockpile refilled for those. We’re going to be in a position to do that.

Beyond that, because we not only make the product, but we also do the potency testing, we are, so to speak, in the middle of what is going to be needed. Our expectation is we can bring that and carry that forward. As investors and stakeholders think about our future, they can understand the durability of our franchises and then, importantly, the expertise that we have to build on these customer relationships today for the next product tomorrow, whether it’s through our own organic R&D or through business development. I think that’s what people should think about for our future. I see a future where we can grow organically, a compound annual growth rate over a three to five-year timeframe. There are opportunities there that we can grow.

My hope is that we’ll be able to show that as we do bolt-ons, both growing organically, but then also doing the bolt-ons that help us grow for the future.

Jason Ellis, Managing Director, Wells Fargo: Great. Really appreciate you being here today, Joe, and thank you for the conversation. Thank you all for joining.

Joe Papa, Chief Executive Officer, Emergent BioSolutions: Thank you, everyone.

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