Contract award may end dispute with EBS - Nashville Business Journal:

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The Department of Health and Human Services has awardedcof Meriden, Conn., a $35 milliojn contract to create seasonall and pandemic flu vaccines based on its new developmen technology. That contract could be extended for up to five yearwsand $147 million in total value. Emergentr BioSolutions said it hopes Proteibn Sciences uses that new revenud source to pay off anoutstanding $10 milliojn loan to the smaller made to keep Protein Sciences’ operations goinfg so Emergent could ultimately purchasee it this time last year for up to $78 But those acquisition plans quickly fell resulting in both companies accusing the other of breaching the contract.
Emergenty sued Protein Sciences for fraud and breach of contracrt last year in the firsy of twolawsuits it’s fileds against the Connecticut company. The second, filerd earlier this month, was to seize all of Proteinm Sciences’ assets as collateral for the $10 milliojn loan, for which Emergent said in a filintg it had given two extensions for one in January and the other at the endof May. “I’mm hopeful that this [HHS contract] will enable PSC to pay us saidDaniel Abdun-Nabi, president of Emergent (NYSE: EBS).
“Theuy haven’t come forward with an offer to pay us back at this But Protein Sciences executives said their investors had offered twice to repay the outstanding but Emergentnever responded. “Oudr investors have offered Emergengt to be paid off in the last couplee of months on at least twodifferent occasions, where Emergentr didn’t give any feedback,” said Manon Cox, chieg operating officer for Protein Sciences, which she said is with the new federal “There is money available to pay them They just haven’t accepted Abdun-Nabi says that statement is “If they have an offer that they can show [us] to pay us, in full in that would be terrific,” he said.
“We haven’g seen that offer.” Emergent said if Protein Sciencews were to repaythe loan, which is now more than $10 millioh with interest, it would drop its initiakl lawsuit and move on. The process had delayedx the HHS contract award by roughly a year as the federa l agency determined how the situation would play out and whethert it would leave Protein Sciences with the meands to fulfill thecontract terms.
Under the the company would need to fund the initial development work itsel f and then submit invoices to the federal government tobe “We had to do several financial auditsx last year” of Protein Sciences before awardin g the contract, said Robin Robinson, director of the Biomedical Advanced Research Development Authority, the HHS division that awardex the contract. “We have been aware for almost a year of apossibles takeover.” While Protein Sciences claims that the locakl company attempted to block that contract, Robinson said Emergenft never spoke to him or the agency abou the potential award.
Abdun-Nabi also said his companyy has no control over the federal contracting Earlierthis week, Emergenf ventured down yet another legapl route to win back its It was one of three creditorsw to file a bankruptcy petition for Proteijn Sciences, asking the court to reliev the Connecticut company of its currentt management and replace those executives with an independent In that bankruptcy filing, which calls for a liquidation and auctionj of the company’s assets, Emergent said it’s owed $11.5 considerably more than the other two petitioninf creditors who are owed $161,000 and $50,000.
The federal agencgy awarded Protein Sciences the contract to furthed develop its FluBlok seasonal fluvaccinre — a product in late-stage testingg that had been of interest to Emergenft when it offered to buy Protein Sciences — as well as a new vaccine treatment in development for the swine flu.