(Released 6 August 2015) Gaithersburg, MD - Emergent BioSolutions Inc. (NYSE:EBS) today announced that its Board of Directors has authorized management to pursue a tax-free spin-off of the company's Biosciences business into a separate, stand-alone publicly-traded company. The spin-off is expected to create two independent public companies with distinct strategic plans, growth strategies, and operational and development priorities.

The new Biosciences company, to be named at a later date, will focus on providing novel oncology and hematology therapeutics to meaningfully improve patients' lives. The core technology of the Biosciences company will be its ADAPTIR platform applied to immuno-oncology. Emergent BioSolutions will continue to operate as a global specialty biopharmaceutical company whose core business is focused on providing specialty products for civilian and military populations that address intentional and naturally emerging public health threats.

"The proposed spin-off recognizes that our two operating divisions have evolved into distinct business and investment opportunities. The Biosciences spin-off establishes each as a pure play company with a focused strategy and enables each company to target investors attracted to its business profile," said  Daniel J. Abdun-Nabi , President and Chief Executive Officer of Emergent BioSolutions. "This transaction will allow us to accelerate our growth strategy while enabling the new Biosciences company to invest in novel therapeutics in the highly attractive immuno-oncology field. We expect the spin-off to enhance business focus, better align resources to achieve strategic priorities, and unlock significant value for both companies."

Strategic Rationale Emergent believes that establishing the Biosciences business as a stand-alone public company offers a number of benefits. The spin-off will enable each company to:

• tailor business strategies to best address opportunities within its target market,

• enhance business focus and better align resources to achieve strategic priorities,

• pursue distinct capital structures and capital allocation strategies, and

• target investors attracted to its business profile.

New Biosciences Company: A biopharmaceutical company focused on novel oncology and hematology therapeutics to meaningfully improve patients' lives The new Biosciences company will consist of certain assets currently in Emergent's Biosciences division, including:

• the ADAPTIR™ (modular protein technology) platform including bi-specific therapeutics based on Redirected T-cell Cytotoxicity (RTCC), a promising approach within immuno-oncology,

• MOR209/ES414, a bi-specific therapeutic for metastatic castration resistant prostate cancer currently in Phase 1 clinical development in partnership with MorphoSys AG, and

• a commercial product portfolio consisting of IXINITY, WinRho, HepaGam B, and VARIZIG.

The Biosciences company will be well-positioned to:

• establish itself as a "pure play" biopharmaceutical company in the highly attractive immuno-oncology field,

• target investments and operations in the development of bi-specific therapeutics using the proprietary ADAPTIR platform technology,

• increase awareness of ADAPTIR's RTCC mechanism of action, and

• provide greater visibility into its innovative platform technology and product candidates for potential collaborators.

Emergent expects to provide the Biosciences company with a fixed cash contribution of $50 million to $70 million. Additional sources of cash to support R&D investment will include commercial product sales and partnership funding.

Emergent BioSolutions: A global specialty biopharmaceutical company focused on providing specialty products for civilian and military populations that address intentional and naturally emerging public health threats Emergent will retain the biodefense marketed products and development programs, platform technologies, and manufacturing infrastructure. Emergent will maintain its headquarters in Gaithersburg, Maryland, biodefense product development facilities in Gaithersburg, Maryland and Munich, Germany, cGMP manufacturing facilities in Lansing, Michigan, Hattiesburg, Mississippi, and Winnipeg, Manitoba, Canada, as well as its CMO fill/finish operations in its Camden site in Baltimore, Maryland. Emergent's  Bayview Campus , also in Baltimore, Maryland, will continue to operate as an HHS-designated Center for Innovation in Advanced Development and Manufacturing. Emergent's Winnipeg manufacturing facility is expected to serve as primary CMO for some products of the Biosciences company under an arm's length, long-term manufacturing agreement.

Emergent, with its focus on its core biodefense business, will be better positioned to:

• establish itself as a "pure play" company, recognized as a leader in the biodefense and emerging infectious diseases fields,

• enhance its financial returns and operating margins through the elimination of biosciences related R&D, sales, marketing and G&A costs, and

• allow greater flexibility in its capital allocation decisions.

Leadership As stand-alone public companies, Emergent and the new Biosciences company will have separate management teams and boards of directors.  Daniel J. Abdun-Nabi  will remain President and Chief Executive Officer and  Robert G. Kramer  will remain Executive Vice President and Chief Financial Officer of Emergent.  Fuad El-Hibri  will remain Executive Chairman of the Board of Directors.

Upon completion of the spin-off,  Marvin L. White  will serve as President and Chief Executive Officer of the new Biosciences company. Mr. White is currently a member of Emergent's Board of Directors. He is the former Chief Financial Officer of St. Vincent's Health, a $2.8 billion multi-hospital health system. Mr. White previously served as Executive Director and CFO of Lilly USA, a subsidiary of Eli Lilly and Company, and held other positions in corporate finance at Eli Lilly and Company.

"Marvin brings more than two decades of experience as a senior executive of prominent pharmaceutical and healthcare organizations," said Mr. Abdun-Nabi. "Having worked with Marvin on our board for five years, it is clear that his combination of leadership talents and business acumen will serve the new Biosciences company well as it strives to achieve the promise of its product portfolio and platform technology."

"Having witnessed the development of the biosciences business as an Emergent director, I am excited for the opportunity to grow this business as an independent public company by leveraging its innovative ADAPTIR technology in the highly-desirable immuno-oncology field," said Mr. White. "I look forward to working with the talented team within the new Biosciences company to advance its unique product candidates for the benefit of patients."

Additional details of the board and management team of the new Biosciences company will be provided at a later date.

Financial Guidance Emergent expects to incur transaction-related expenses of $2 million to $4 million in 2015, which are included in its reaffirmed 2015 financial guidance. The company expects additional costs in 2016 leading up to completion of the spin-off.   

Additional Information and Next Steps The transaction is intended to take the form of a tax-free distribution to Emergent's shareholders of common stock of a new publicly-traded Biosciences company. The stock distribution ratio and other matters, including the stock exchange on which the new Biosciences company's stock will be listed, will be determined at a later date. Emergent will continue to be listed on the New York Stock Exchange under its existing symbol "EBS." 

More details about the Biosciences company, including pro forma financial information, will be disclosed when the new Biosciences company files a Form 10 registration statement with the Securities and Exchange Commission in connection with the transaction. The initial filing of the Form 10 registration statement is expected to occur in the first quarter of 2016. The transaction is expected to be completed in mid-2016, subject to certain conditions, including the receipt of a favorable opinion from outside tax counsel and private letter ruling from the Internal Revenue Service, execution of inter-company agreements by Emergent and the new Biosciences company, the effectiveness of the Form 10 registration statement, and final approval of the transaction by Emergent's board of directors.

The transaction will not require the approval of Emergent's shareholders. Obligations under the 2.875% Convertible Senior Notes due 2021 will remain with Emergent following completion of the transaction, subject to the conversion adjustments provided in the indenture governing the notes.

Emergent may, at any time and for any reason until the proposed spin-off is complete, abandon the spin-off or modify its terms and conditions.

Emergent is being advised by J.P. Morgan Securities LLC, as financial advisor, and by Wilmer Cutler Pickering Hale and Dorr LLP, as legal advisor.