Emergent Biosolutions Inc. (NYSE: EBS) has completed the sale of its reactive skin decontamination lotion (RSDL®) kit to Serb Pharmaceuticals for an approximate purchase price of $75 million. Additionally, Serb will pay Emergent a $5 million payment upon the achievement of a milestone related to the sourcing of a certain component of RSDL®.
As part of the transaction, Serb will also acquire and maintain operations of Emergent’s leased manufacturing facility in Hattiesburg, Mississippi, and several site-based employees who support RSDL® will join Serb. Serb will also acquire the RSDL® product inventory as part of the transaction and will assume certain related contracts. Emergent’s Winnipeg facility will continue to manufacture and supply bulk lotion to Serb under a long-term supply agreement between the two companies.
This sale follows Emergent’s announcement to sell its drug product facility in Baltimore-Camden, as well as operational changes, which are key actions in its multi-year plan. The net proceeds from the sale of RSDL® and the Baltimore-Camden facility will reduce or eliminate the junior capital raise requirements under Emergent's amended credit facility, a requirement that was recently extended to September 29, 2024.
Joe Papa, President and Chief Executive Officer at Emergent, stated that the decision to divest RSDL® is driven by efforts to significantly reduce Emergent’s total debt in 2024. He expects to decrease the company’s debt by more than $150 million through operating performance improvements, working capital reductions, and product/asset divestments.
For Emergent, Evercore served as the financial advisor, and Covington & Burling LLP served as legal counsel in connection with this transaction.
RSDL® is an FDA-cleared device provided as a kit consisting of a lotion-impregnated sponge in a packet, intended to remove or neutralize chemical warfare agents from the skin. The RSDL® kit has been adopted by numerous militaries around the world with over 15 million packets of RSDL® sold in over 30 countries.
This transaction aligns with Emergent’s mission to protect and enhance life, providing solutions for complex and urgent public health threats through a portfolio of vaccines and therapeutics, as well as offering integrated contract development and manufacturing services for pharmaceutical and biotechnology customers. Today the company's shares have moved 10.3% to a price of $13.09. If you want to know more, read the company's complete 8-K report here.
