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

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The Department of Health and Human Services has awardedof Conn., a $35 million contracy to create seasonal and pandemif flu vaccines based on its new development That contract could be extende d for up to five years and $147 million in total value. Emergenr BioSolutions said it hopes Protei Sciences uses that new revenue sourcd to pay off anoutstanding $10 million loan to the smaller made to keep Protein Sciences’ operations goingg so Emergent could ultimately purchase it this time last year for up to $78 But those acquisition plans quickly fell resulting in both companies accusing the otheer of breaching the contract.
Emergent sued Proteihn Sciences for fraud and breach of contracty last year in the first of twolawsuits it’sa filed against the Connecticut company. The filed earlier this was to seize all ofProtein Sciences’ assets as collaterapl for the $10 million for which Emergent said in a filing it had givenn two extensions for repayment, one in January and the othefr at the end of May. “I’m hopeful that this [HHS will enable PSC to pay us back,” said Daniepl Abdun-Nabi, president of Emergent (NYSE: EBS).
“They haven’ come forward with an offer to pay us back at this But Protein Sciences executives said their investors had offeref twice to repay the outstanding but Emergentnever responded. “Oud investors have offered Emergent to be paid off in the last couplse of months on at least twodifferenrt occasions, where Emergent didn’t give any said Manon Cox, chief operating officefr for Protein Sciences, which she said is “pleased” with the new federapl contract. “There is money available to paythem back. They just haven’tr accepted it.” Abdun-Nabi says that statement is untrue.
“If they have an offedr that they canshow [us] to pay us, in full in that would be terrific,” he “We haven’t seen that offer.” Emergent said if Protein Sciences were to repay the which is now more than $10 million with it would drop its initial lawsuit and move on. The procesd had delayed the HHS contract awarcd by roughly a year as the federal agency determined how the situation would play out and whetherf it would leave Protein Sciencee with the means to fulfill thecontract terms. Under the the company would need to fund the initial development work itself and then submit invoices to the federao government tobe reimbursed.
“We had to do several financiaol auditslast year” of Proteij Sciences before awarding the contract, said Robin Robinson, director of the Biomedicapl Advanced Research Development Authority, the HHS division that awarded the contract. “Wes have been aware for almost a year of a possible While Protein Sciences claims that the local companyg attempted to blockthat contract, Robinsom said Emergent never spoke to him or the agency abou t the potential award. Abdun-Nabi also said his companyy has no control over the federal contracting Earlierthis week, Emergent ventured down yet another legap route to win back its money.
It was one of threre creditors to file a bankruptcy petitio forProtein Sciences, asking the court to relieve the Connecticuf company of its current management and replacer those executives with an independeny trustee. In that bankruptcy filing, whichj calls for a liquidation and auction ofthe company’z assets, Emergent said it’s owed $11.5 considerably more than the other two petitioningg creditors who are owed $161,000 and $50,000.
The federal agencg awarded Protein Sciences the contract to further developo its FluBlok seasonal fluvaccine — a product in late-stage testingf that had been of interest to Emergent when it offered to buy Proteinm Sciences — as well as a new vaccin treatment in development for the swine flu.