Emergent Biosolutions (NYSE:EBS) reported first-quarter 2026 results that management said exceeded the high end of the company’s revenue guidance range, while continuing to emphasize progress on a multi-year transformation plan and balance sheet actions completed in April.
First-quarter results top guidance range
Joe Papa, president and CEO, said the company’s “first quarter results are evident in both our top and bottom line performance,” citing revenue of $156 million that “exceeded the high end of our guidance range.”
Lindahl reported adjusted EBITDA of $36 million and an adjusted EBITDA margin of 23% for the quarter. He also cited an adjusted gross margin of 52% and said operating expenses were $57 million, down $10 million year over year. He added that R&D spending declined “by about a third compared to the first quarter of 2025.”
Medical countermeasures and naloxone updates
Papa described Emergent’s portfolio as spanning medical countermeasures for threats including anthrax, smallpox, mpox, Ebola, botulism, and complications from smallpox vaccination, alongside its branded naloxone franchise, NARCAN Nasal Spray.
On the medical countermeasures (MCM) business, Papa said performance in the quarter reflected “increased global demand and strategic diversification in our international markets,” adding that international markets represented 37% of total MCM revenue during the quarter. He also said the company “received four contracted product orders in the quarter.”
Papa highlighted several agreements and orders announced during the quarter, including:
- A $140 million multi-product agreement with the government of Canada, which he described as a long-standing partner
- A $54 million VIGIV award with ASPR
- An approximately $21.5 million delivery order to supply BioThrax to the U.S. Department of Defense
In response to a question on MCM margins, Papa said Emergent has a “most favored nation pricing type of arrangement” with the U.S. government, which he said means pricing outside the U.S. will be “slightly higher” depending on the product. Lindahl added that investors “should assume that the international sales are above the average for the MCM segment in total,” pointing to higher international prices as a driver of higher margins.
On naloxone, Papa said the company continues to “maintain the share of leadership” and highlighted new product offerings: a NARCAN Nasal Spray carrying case and a multi-pack configuration, which he said were “already performing very well in the first month of launch.” Papa also said the U.S. FDA approved the carrying case and multi-pack options.
He pointed to continued public funding and settlement-related spending as supportive to naloxone demand, referencing opioid settlement funds of “over $50 billion” and saying the Purdue settlement “released over $5 billion” for states. Papa also said, “Since 2016, Emergent has delivered more than 100 million doses of NARCAN Nasal Spray” across the U.S. and Canada.
Refinancing, liquidity, and capital allocation
Management emphasized cash flow and balance sheet initiatives. Papa said net working capital improved by “over $100 million since Q1 2025,” and that the company improved its cash balance by $11 million year over year to $160 million, with total liquidity of $260 million.
Lindahl said the company reduced net debt by $122 million, or approximately 22% versus the first quarter of 2025, and reported a net leverage ratio of 2.4x adjusted EBITDA at Q1 2026 versus 2.7x in the year-ago quarter.
In April, Emergent refinanced its prior term loan. Papa said the transaction secured “a more favorable interest rate,” amended the revolver to $50 million, and established a new $75 million delayed draw term loan facility. Lindahl said the refinancing “lower[s] interest costs,” “extend[s] maturities,” and improves covenant terms, and he stated the term loan refinancing extended maturities out to 2031.
On shareholder returns, Papa said Emergent bought back $9 million in shares in the first quarter and has repurchased approximately $34 million since launching the program in 2025. Lindahl said the company has a $50 million share repurchase program through March 31, 2027, and that $46.5 million remained available as of the end of the first quarter.
Partnerships, manufacturing footprint, and pipeline priorities
Papa said the company is expanding its Canton manufacturing site in Massachusetts and described a strategic partnership with Substipharm Biologics that will allow Emergent to restart manufacturing at the facility to support the Japanese encephalitis vaccine. He said Emergent entered into a U.S. distribution agreement with Substipharm to support a U.S. government opportunity following U.S. FDA approval, and characterized the approach as moving beyond a fee-for-service CDMO model toward one that allows Emergent to “share in the product’s potential success.”
Papa also highlighted a second strategic manufacturing partnership with SAB Biotherapeutics, saying the work will be led by Emergent’s Winnipeg team to advance SAB’s type 1 diabetes autoimmune candidate. In response to an analyst question, Papa said the SAB relationship was “more of a technology than it was a therapeutic area approach,” describing it as an alignment between Emergent’s Winnipeg capabilities and SAB’s needs.
Addressing the company’s manufacturing footprint, Papa said Emergent has “streamlined our footprint,” while also describing the ability to ramp up the Canton facility as a way to bring “additional drug substance capabilities for very difficult products,” including the ability to work with “live virus or Category B live viruses.”
On the pipeline and growth drivers, Papa outlined four levers: internal R&D investments in TEMBEXA, Ebanga, and raxibacumab; NARCAN line extensions; international MCM growth; and business development efforts, including projects “such as KLOXXADO,” alongside the Japanese encephalitis vaccine opportunity. He also said that ACAM2000 received Singapore Health Sciences Authority expanded approval to include mpox.
Guidance maintained; EBITDA outlook updated for definition change
Lindahl said the company is maintaining its full-year 2026 total revenue guidance of $720 million to $760 million. He said commercial revenues are expected to be “flat to slightly up” and that Emergent expects NARCAN to maintain its leading market share, while MCM revenues are expected to be “flat to slightly down,” with a significant contribution from international sales.
Emergent expects adjusted gross margin of 45% to 47%. Lindahl said the company is updating adjusted EBITDA guidance to account for adding back non-cash stock compensation beginning in 2026, which he said aligns with peers and with covenant calculations under the new debt agreement. Full-year adjusted EBITDA is now expected to be $155 million to $175 million. For the second quarter, the company expects total revenue of $170 million to $185 million.
Lindahl also noted a balance-sheet item tied to the Ebanga program. He said the company previously disclosed $50.4 million of contingent consideration that could be owed to Ridgeback Bio in the second quarter assuming continued progress under a BARDA contract, and that the company now expects those conditions will be met and has recorded the amount as an accrued acquisition obligation under current liabilities. In the Q&A, Lindahl confirmed it will be “a cash outflow in the second quarter.”
About Emergent Biosolutions (NYSE:EBS)
Emergent BioSolutions is a global specialty biopharmaceutical company focused on developing, manufacturing and commercializing medical countermeasures and specialty products that address public health threats. The company’s portfolio includes vaccines, antibody therapies and critical care products designed to protect against biological, chemical and emerging infectious disease threats. Emergent has longstanding partnerships with government agencies, including the U.S. Department of Defense and the Biomedical Advanced Research and Development Authority (BARDA), to support national preparedness programs.
Key commercial products in Emergent’s lineup include BioThrax (anthrax vaccine adsorbed), ACAM2000 (smallpox vaccine) and Vaxchora (cholera vaccine), alongside therapeutic treatments such as Anthrasil (anthrax immune globulin) and the naloxone-based nasal spray Narcan for opioid overdose reversal.
