Emergent BioSolutions (EBS) risk factors, FY2025 10-K

Other

1. 01GOVERNMENT CONTRACTING RISKS
2. 02Our USG procurement and development contracts require ongoing funding decisions by the USG. Any reduction or discontinuation of funding of any of these contracts could cause our business, financial condition, operating results and cash flows to suffer materially
3. 03There can be no assurance that we will be able to secure follow-on product procurement contracts with the USG upon the expiration of any of our existing procurement contracts
4. 04The government contracting process is typically a competitive bidding process and involves unique risks and requirements
5. 05Unfavorable provisions in government contracts, some of which may be customary, may subject our business to material limitations, restrictions and uncertainties and may have a material adverse impact on our business, financial condition, operating results and cash flows
6. 06An inability to maintain manufacturing compliance at our manufacturing facilities, which could damage our reputation and adversely affect our business, financial condition, operating results and cash flows50% rewritten
7. 07Damage to, destruction of, or any disruption at our manufacturing facilities could impede our ability to manufacture our products or product candidates, as well as impact the delivery of bioservices to third parties, which would harm our business, financial condition, operating results and cash flows
8. 08We are contractually required to ship our biologic products at a prescribed temperature range and variations from that temperature range could result in loss of product and could significantly and adversely impact our revenues, which would harm our business, financial condition, operating results and cash flows
9. 09Our products and product candidates procured by the USG and other customers require us to perform tests for and meet certain product release standards prescribed by the FDA and other agencies, which may not be met on a timely basis or at all
10. 10Our operations, including our use of hazardous materials, chemicals, bacteria and viruses, require us to comply with regulatory requirements and expose us to significant potential liabilities
11. 11The product candidates that we work on internally or for third-party customers may not be safe or effective and even if they are, we may be unable to manufacture sufficient quantities to meet demand52% rewritten
12. 12Our growth depends on our success in developing and commercializing our product candidates. If we are unable to commercialize these product candidates or experience significant delays or unanticipated costs in doing so, our business would be materially and adversely affected
13. 13In particular, the success of NARCAN® (naloxone HCl) Nasal Spray, including in over-the-counter form, is subject to commercial availability of the product and our ability to gain sufficient market acceptance by physicians, patients, third-party payors and others in the medical community
14. 14We may fail to select or capitalize on the most scientifically, clinically or commercially promising or profitable product candidates

REGULATORY AND COMPLIANCE RISKS

1. 15There are a number of complex laws and regulations that pertain to government contracts and compliance with those laws and regulations require significant time and cost, which could have a material adverse effect on our business, financial condition, operating results and cash flows
2. 16Our long-term success depends, in part, upon our ability to develop, receive regulatory approval for and commercialize product candidates we develop or acquire and, if we are not successful, our business, financial condition, operating results and cash flows may suffer24% rewritten
3. 17Failure to successfully develop future product candidates may materially adversely affect our business, financial condition, operating results and cash flows
4. 18Even if we or our collaborators obtain marketing approvals for our product candidates, the conditions of approvals and ongoing regulation of our products may limit how we manufacture, market and sell our products, which could materially impair our ability to generate revenue30% rewritten
5. 19Current and future policy or legislation may increase the difficulty and cost for us and our collaborators to obtain marketing approval of and commercialize our product candidates, which may affect the prices we, or our collaborators, may obtain
6. 20If we fail to comply with foreign, federal, state and local health care laws, including fraud and abuse laws, health information privacy and security laws, and antitrust laws, we could face substantial penalties and our business, results of operations, financial condition and prospects could be adversely affected
7. 21Because of the breadth of these laws and the narrowness of the statutory exceptions and safe harbors available under the federal Anti-Kickback Statute, it is possible that some of our business activities could be subject to challenges under one or more of such laws
8. 22If we fail to comply with our obligations under U.S. governmental pricing programs, we could be required to reimburse government programs for underpayments and could pay penalties, sanctions and fines
9. 23Even after regulatory approval is received, if we fail to comply with regulatory requirements, or if we experience unanticipated problems with our approved products, they could be subject to restrictions, penalties or withdrawal from the market32% rewritten
10. 24Failure to obtain or maintain regulatory approval in international jurisdictions could prevent us from marketing our products abroad and could limit the growth of our business54% rewritten
11. 25Laws and regulations governing international operations may preclude us from developing, manufacturing and selling certain products outside of the United States, require us to develop and implement costly compliance programs, and if violated, can lead to financial and other impacts
12. 26Changes to tax legislation may adversely affect our businessNew
13. 27Development and commercialization of pharmaceutical products, including for PHT preparedness, are routinely subject to evolving private and public sector competition58% rewritten
14. 28Our biologic products may face risks of competition from biosimilar manufacturers
15. 29NARCAN® (naloxone HCl) Nasal Spray is currently subject to generic and branded competition and may be subject to additional generic and branded competition in the future. If demand for over-the-counter NARCAN® Nasal Spray outpaces current estimations, there could be supply challenges to meet demand35% rewritten
16. 30Sales of generic versions of NARCAN® Nasal Spray at prices lower than our branded product or provided at no cost by Teva, Padagis and Amneal have the potential to erode our sales and could impact our product revenue related to NARCAN® Nasal Spray48% rewritten
17. 31Political or social factors may delay or impair our ability to market and sell our products and may require us to spend significant management time and financial resources to address these issues
18. 32We may not be able to obtain orphan drug exclusivity for product candidates we may develop, and even if we do, that exclusivity may not prevent the FDA or foreign regulatory authorities from approving other competing products
19. 33Obtaining, maintaining and enforcing our intellectual property rights in the United States and other countries remains a critical component of the development and commercialization of our Company's assets
20. 34Potential loss of proprietary information and know-how generally carries the risk of reducing the value of our technology and products

RISKS RELATED TO RELIANCE ON OTHER PARTIES

1. 35The loss of any of our non-exclusive, sole-source or single source suppliers, a shortage of related supplies or an increase in the price of materials supplied to us could have an adverse effect on our business, financial condition and results of operations

LEGAL AND REPUTATIONAL RISKS

1. 36Our financial condition and operating results could be adversely impacted by unfavorable results of legal proceedings or government investigations
2. 37We face an inherent risk of product liability exposure related to the sale of our products, any other products that we successfully acquire or develop and the testing of our product candidates in clinical trials

FINANCIAL RISKS

1. 38Our level of indebtedness and the terms of our indebtedness could adversely affect our business and liquidity position. We may not have sufficient cash flow from our operations to pay our substantial debt
2. 39As described in Note 11, “Debt” in the Notes to Consolidated Financial Statements in Part II, Item 8. of this Annual Report on Form 10-K, as of December 31, 2025, we have approximately $589.7 million of total indebtedness, which includes our outstanding Senior Unsecured Notes
3. 40Our current indebtedness restricts and any additional debt financing may restrict the operation of our business and limit the cash available for investment in our business operations
4. 41Our hedging programs have been, and any hedging program we initiate in the future will be, subject to counterparty default risk31% rewritten
5. 42We may not maintain profitability in future periods or on a consistent basis
6. 43Impairment charges to our intangible assets or property, plant and equipment could have a material adverse effect on our business, results of operations and financial condition79% rewritten
7. 44We also periodically monitor the remaining net book values of our property, plant and equipment, or whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverableNew
8. 45The expansion of our international operations increases our risk of exposure to credit losses

RISKS RELATED TO STRATEGIC ACQUISITIONS, DIVESTITURES AND COLLABORATIONS

1. 46We may not be successful in identifying, structuring or acquiring businesses and products to drive our growth
2. 47We may not be able to integrate any acquired business successfully or operate any acquired business profitably. In addition, cost synergies, if achieved at all, may be less than we expect, or may take greater time to achieve than we anticipate
3. 48Divestitures and sales of assets could negatively impact our business, and retained liabilities from businesses or assets that we have sold could adversely affect our financial resultsNew

RISKS RELATED TO OWNERSHIP OF OUR COMMON STOCK

1. 49Our business or our share price could be negatively affected as a result of the actions of stockholders54% rewritten
2. 50Provisions in our certificate of incorporation and by-laws and under Delaware law may discourage acquisition proposals, delay a change in control or prevent transactions that stockholders may consider favorable
3. 51Our board of directors may adopt a new stockholder rights plan without stockholder approval, which could prevent a change in control of us in instances in which some stockholders may believe a change in control is in their best interests
4. 52Our stock price is volatile, and purchasers of our common stock could incur substantial losses41% rewritten
5. 53Because we currently do not pay dividends, investors will benefit from an investment in our common stock only if it appreciates in value
6. 54Future sales of our common stock or other securities convertible into common stock, or the perception that such sales or issuances could occur, could result in dilution of our stockholders and could cause our share price to decline
7. 55We cannot guarantee that our 2025 Share Repurchase Program will be utilized in full, or at all, or that our 2025 Share Repurchase Program will enhance long-term stockholder valueNew
8. 56Our success is dependent on our continued ability to attract, motivate and retain key personnel, and any failure to attract or retain key personnel may negatively affect our business