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Emergent (EBS) Issues Plan to Resume Bayview Facility Operation

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Emergent BioSolutions Inc. (EBS - Free Report) announced a comprehensive quality enhancement plan for its COVID-19 vaccine manufacturing unit, Bayview facility, at Baltimore in response to FDA’s observations following a mishap in March.

Reportedly, a manufacturing mix-up of vaccine ingredients of J&J’s (JNJ - Free Report) and AstraZeneca’s (AZN - Free Report) COVID-19 vaccines at the Bayview facility ruined several million doses of J&J’s vaccine in March. Following the incident, J&J took full responsibility of the facility during early April and manufacturing of AstraZeneca’s vaccine was stalled in the facility to avoid further mishaps. In the middle of April, the FDA started inspection of the facility and halted all manufacturing operations.

Upon completion of its inspection, the FDA revealed several blistering observations. The regulatory authority reported unexplained discrepancies that led to mix-up mishap. Moreover, the facility was not properly cleaned and maintained so as to support vaccine production. Emergent’s employees failed to follow written instruction to avoid cross-contamination and did not maintain proper handling and storage procedures to avoid contamination. The FDA also observed that written procedures to assure quality and identity of drug substances were not adequate. Moreover, employees lacked proper training to handle vaccine production process.

Emergent stated that it has already started making improvements per the quality enhancement plan and is committed to make all necessary enhancements to meet the FDA’s standard. The company is continuously engaged in discussion with the FDA and J&J related to the path forward for resuming operations at the Bayview facility.

Although J&J targets to deliver 100 million doses by the end of May to the U.S. government, the production halt at the Bayview facility may lead to failure to meet that target. Moreover, a lengthy delay in resuming operations at the Bayview facility should have spill over effect on J&J’s vaccine production and supply commitments later in 2021 too. Meanwhile, this setback is likely to help its competitors in the COVID-19 vaccine space — Moderna (MRNA - Free Report) and Pfizer — gain more orders for their vaccines. Both companies raised their supply commitments for their COVID-19 vaccines on their first-quarter earnings call.

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