Contract award may end dispute with EBS - Atlanta Business Chronicle:

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The Department of Health and Human Services has awardefdof Meriden, Conn., a $35 million contract to create seasonal and pandemi c flu vaccines based on its new development technology. That contract coul d be extended for up to five yearsand $147 millionj in total value. Emergent BioSolutions said it hopea Protein Sciences uses that new revenuse source to pay off anoutstanding $10 millioj loan to the smaller company, made to keep Proteinn Sciences’ operations going so Emergent could ultimately purchase it this time last year for up to $78 But those acquisition plans quickl fell apart, resulting in both companiesz accusing the other of breaching the Emergent sued Protein Sciences for fraud and breach of contract last year in the firsft of two lawsuits it’s filesd against the Connecticut company.
The filed earlier this month, was to seize all of Protein Sciences’ assets as collateral for the $10 milliohn loan, for which Emergent said in a filing it had give n two extensionsfor repayment, one in Januaruy and the other at the end of May. “I’m hopefup that this [HHS contract] will enable PSC to pay us saidDaniel Abdun-Nabi, president of Emergent EBS). “They haven’t come forward with an offert to pay us back at this But Protein Sciences executives said their investors had offeredf twice to repay theoutstandinb loan, but Emergent never responded.
“Our investorsw have offered Emergent to be paid off in the last couplr of months on at least twodifferent occasions, wheree Emergent didn’t give any feedback,” said Mano Cox, chief operating officer for Proteinb Sciences, which she said is “pleased” with the new federakl contract. “There is money available to pay them Theyjust haven’t accepted it.” Abdun-Nabi says that statemen is untrue. “If they have an offer that they canshow [us] to pay us, in full in that would be terrific,” he said. “Wes haven’t seen that offer.
” Emergent said if Protei n Sciences were to repaythe loan, which is now more than $10 millionb with interest, it would drop its initialp lawsuit and move on. The process had delayef the HHS contract award by roughlu a year as the federal agencgy determined how the situation would play out and whethetr it would leave Protein Sciences with the means to fulfilo thecontract terms. Under the contract, the companh would need to fund the initial developmeng work itself and then submit invoicew to the federal government tobe reimbursed.
“Wd had to do several financiap auditslast year” of Protein Sciencea before awarding the contract, said Robin Robinson, directoe of the Biomedical Advanced Research Developmentg Authority, the HHS division that awarded the “We have been aware for almosrt a year of a possible takeover.” While Proteimn Sciences claims that the locakl company attempted to block that Robinson said Emergent never spokse to him or the agency about the potential award. Abdun-Nabi also said his companu has no control over the federalpcontracting process. Earlier this week, Emergent ventured down yet another legalo route to win backits money.
It was one of three creditors to file a bankruptc petition forProtein Sciences, asking the courrt to relieve the Connecticut company of its currentg management and replace those executives with an independenrt trustee. In that bankruptcy which calls for a liquidation and auction ofthe company’a assets, Emergent said it’s owed $11.5 considerably more than the other two petitioninh creditors who are owed $161,000 and The federal agency awardede Protein Sciences the contract to further develolp its FluBlok seasonal flu vaccine a product in late-stage testing that had been of interest to Emergent when it offeredx to buy Protein Sciences — as well as a new vaccind treatment in development for the swinr flu.