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Changed Risks for EMERGENT BIOSOLUTIONS INC (EBS)

We may not be able to utilize the full manufacturing capacity of our

BioThrax and ACAM2000, which may not be obtained on a timely basis or at all

inadequacy, interruption or security lapse of that technology, including any cyber security incidents, could harm our ability to operate our business effectively or result in data leakage of proprietary and confidential business and employee

requirements, or if we experience unanticipated problems with our approved products, they could be subject to restrictions, penalties or withdrawal from the market

should carefully consider the following risk factors in addition to the other information in this Annual Report on Form 10-K when evaluating our business because these risk factors may have a significant impact on our business, financial

The government contracting process is typically a competitive bidding process

an increase in the price of inventory supplied to us could have an adverse effect on our business, financial condition and results of operations

Directors, or delay or prevent a change of

Laws and regulations affecting government contracts make it costlier and more

Failure

difficult for us to successfully conduct our business Failure to comply with these laws could result in significant civil and criminal penalties and materially damage our reputation and relationship with the USG, which could have a material

Our submission of NuThrax for EUA pre-approval and eventual FDA licensure may

with third parties, we could lose license rights that are important to our business

we are unable to obtain supplies for the manufacture of our products and product candidates in sufficient

One or more of our products could be subject to early generic competition

the members of our Board of

*Trobigard® is not currently approved or cleared by the FDA or any similar

Political or social factors may delay or impair our ability to market our

RISKS RELATED TO STRATEGIC ACQUISITIONS AND COLLABORATIONS

The loss of any of our non-exclusive, sole-source or single source suppliers or

law may discourage acquisition proposals, delay a change in control or prevent transactions that stockholders may consider favorable

face substantial competition, which may result in others developing or

they may materially harm our business, financial condition, operating results or cash flows Additional risks and uncertainties that we have not yet identified or that we presently consider to be immaterial may also materially harm our business,

could materially and adversely affect our financial resources, which would adversely affect our business, financial condition, operating results and cash flows

We may fail to select or capitalize on the most scientifically, clinically or

There can be no assurance that we will be able to secure follow-on procurement

operations, including our use of hazardous materials, chemicals, bacteria and viruses, require us to comply

their outcome is uncertain We must invest substantial amounts of time and financial resources in these trials, which may not yield viable products Failure to obtain regulatory approval for product candidates, particularly in the United States,

INTELLECTUAL PROPERTY RISKS

We may require significant additional funding and may be unable to raise capital

these product candidates, or experience significant delays or unanticipated costs in

Third parties may choose to file patent infringement claims against us;

depend on third parties to conduct our clinical and non-clinical trials If these third parties do not perform as contractually

Disruption at, damage to or destruction of our manufacturing facilities could

and involves unique risks and requirements

USG procurement and development contracts require ongoing funding decisions by the

Even after regulatory approval is received, if we fail to comply with regulatory

to obtain or maintain regulatory approval in international jurisdictions could prevent us

If we fail to comply with our obligations in our intellectual property licenses

If the spin-off distribution on August 1, 2016 of all of the outstanding shares

these contracts could cause our

when needed or on acceptable terms, which would harm our ability to grow our business, and our results of operations and financial condition

growth depends on our success in developing and commercializing our product candidates If we are unable to

condition, operating results, and cash flows could be materially harmed

REGULATORY AND COMPLIANCE RISKS

investment in our common stock only if it appreciates in value

If we are unable to protect the confidentiality of our proprietary information

time,

stock price is volatile and purchasers of our common stock could incur

RISKS RELATED TO OWNERSHIP OF OUR COMMON STOCK

with regulatory

Under certain circumstances, we might sell unapproved MCMs to government

Unfavorable

financial condition, operating results or cash flows The discussion of these factors is incorporated by reference into and considered an integral part of Part II, Item 7, “Management’s Discussion and Analysis of Financial Conditions and Results

manufacturing facilities, which could impact our future revenues and materially harm our business, financial condition, operating results and cash flows

resources and expenses required for us to perform under those contracts If our actual costs exceed our estimates, we may not be able to earn an adequate return or may incur a loss

than we do

adverse effect on our business, financial condition, operating results and cash flows

of Aptevo Therapeutics Inc common stock to our stockholders does not qualify as a tax-free transaction for US federal income tax purposes, we and our stockholders could be subject to significant tax liabilities

products and may require us to spend significant management time and financial resources to address these issues

future competition from other treatments

FINANCIAL RISKS

Clinical trials of product candidates are expensive and time-consuming, and

entities While this is permissible in some cases, the extent to which we may be able to lawfully market and sell unapproved products in many jurisdictions may be unclear or ambiguous Such sales could subject us to regulatory enforcement action,

restrictions and uncertainties and may have a material adverse impact on our business, financial condition, operating results and cash flows

commercialize

THE SPIN-OFF OF OUR BIOSCIENCES BUSINESS

subject our business to material limitations,

and know-how, the value of our technology and products could be adversely affected

significant influence over us through his substantial

We may not maintain profitability in future periods or on a consistent basis

USG Reduced or discontinued funding of

If we are unable to protect our proprietary rights, our business, financial

commercializing products before or more successfully

We intend to transfer the manufacturing of raxibacumab, which we acquired from

doing so, our business would be

provisions in government contracts, some of which may be customary, may

sufficient cash flow from our operations to pay our substantial debt

impede our ability to manufacture BioThrax or our other products, as well as deliver our contract development and manufacturing services, which would harm our business, financial condition, operating results and cash flows

success is dependent on our continued ability to attract, motivate and retain key personnel, and any failure to attract or retain key personnel may

from marketing our products

El-Hibri, executive chairman of our Board of Directors, has

manufacturers

contracts with the USG upon the expiration of any of our current product procurement contracts

MANUFACTURING RISKS

We are required to obtain FDA approval prior to the release of each lot of

internal control over financial reporting A material weakness in our internal control over financial reporting could have an adverse effect on our business and financial results and our ability to meet our reporting obligations could be negatively

Our Biologic Products may face risks of competition from biosimilar

candidates and, as a result, our business, financial condition, operating results and cash flows may suffer

currently derive a substantial portion of our revenue from sales of BioThrax to our largest customer, the USG If the USG’s demand for and/or funding for procurement of BioThrax is substantially reduced, our

Our failure to successfully integrate acquired businesses and/or assets into our

amount we are paid under our fixed price government procurement contracts is based on estimates we have made of the

GOVERNMENT CONTRACTING RISKS

NuThrax

defending ourselves from such allegations could be costly, time-consuming, distracting to management, and could materially and adversely affect our business, financial condition, operating results, and cash flows

beneficial ownership of our common stock, including an ability to influence the election of

Provisions in our certificate of incorporation and by-laws and under Delaware

of Operations”

materially and adversely affected

We expect our recently acquired NARCAN® Nasal Spray marketed product to face

for certain matters This indemnity may not be sufficient to hold us harmless from the full amount of losses that we may incur in connection with these matters, and Aptevo may not be able to satisfy its indemnification obligations to us

PRODUCT DEVELOPMENT AND COMMERCIALIZATION RISKS

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 suffer

commercialize our product

Our strategy of generating growth through acquisitions may not be successful

credit losses

abroad and could limit the growth of our business

quantities, at an

business, financial condition, operating results and cash flows would be materially harmed

significant portion of our shares may be sold into the market at any time This could cause the market price of our common stock to drop

operations could adversely affect our ability to realize the benefits of such acquisitions and, therefore, to grow our business

information

Fuad

acceptable cost and in acceptable quality, our ability to manufacture or to develop and commercialize our products and product candidates

Board of Directors may implement a new stockholder rights plan without stockholder approval, which could prevent a change in control of us in instances in

current indebtedness and any additional debt financing may restrict the operation of our business and limit the cash available for investment in our

face product liability exposure, which could cause us to incur substantial liabilities and

We rely significantly on information technology systems and any failure,

The expansion of our international operations increases our risk of exposure to

COMPETITIVE AND POLITICAL RISKS

requirements and expose us to significant potential liabilities

The accuracy of our financial reporting depends on the effectiveness of our

In connection with Aptevo’s separation from us, Aptevo agreed to indemnify us

negatively affect our business,

financial condition and results of operations

regulatory body and is only distributed to authorized government buyers for use outside the US This product is not distributed in the US

If any of the risks described below or in subsequent reports we file with the SEC actually occur,

Because we currently do not pay dividends, investors will benefit from an

GSK, to our bulk and fill finish facilities in Baltimore, Maryland, and this transfer of manufacturing operations requires FDA approval

Servicing our debt requires a significant amount of cash, and we may not have

commercially promising or profitable product candidates

product liability and reputational risk

not be approved by the FDA in a timely manner or at all Delays in our ability to achieve such pre-approval and licensure could prevent us from realizing the full potential value of our BARDA contract for the advanced development and procurement of

affected, each of which could negatively affect the trading price of our common stock

OTHER BUSINESS RISKS

condition, operating results or cash flows