Good day, ladies and gentlemen, and welcome to the Emergent BioSolutions fourth quarter and full year 2010 financial results conference call. My name is Jeff and I will be your operator for today. At this time, all participants are in listen-only mode. Later we will conduct a question-and-answer session. (Operator Instructions) As a reminder, this conference is being recorded for replay purposes. I would now like to turn the conference over to your host for today Mr. Robert Burrows, Vice President of Investor Relations. Please proceed, Mr. Burrows.

Thank you, Jeff. Thank you everyone for joining us today as we discuss Emergent BioSolutions financial results for 4Q and full year 2010. As is customary, our call today is open to all participants. In addition, the call is being recorded and is copyrighted by Emergent BioSolutions. Joining me on the call this afternoon with prepared comments will be Fuad El-Hibri, Our Chairman and Chief Executive Officer and Don Elsey, our Chief Financial Officer. Additional members of our senior management team will be present on the call for purposes of the Q&A session. Before we begin, I'm compelled to remind everyone that during the call, management may make projections and other forward-looking statements regarding future events and the company's prospects for future performance. These forward-looking statements reflect Emergent's current perspective on existing trends and information. Any such forward-looking statements are not guarantees of future performance and involve substantial risks and uncertainties. Actual results may differ materially from those projected in any forward-looking statements. You are encouraged to review Emergent's filings with the SEC on Forms 10-K, 10-Q and 8-K for more information on the risks and uncertainties that could cause actual results to differ. For the benefit of those you may be listening to the replay, this call was held and recorded on March 10, 2011. Since then, Emergent may have made announcements relating to topics discussed during today's call. So again please reference our most recent press releases and SEC filings. Emergent BioSolutions assumes no obligation to update the information in today's press release or as presented on this call except as may be required by applicable laws or regulations. Today's press release may be found on our website at www.emergentbiosolutions.com under Investors/Press Releases. With that introduction, I would now like to turn the call over to Fuad El-Hibri, Emergent BioSolutions' Chairman and CEO. Fuad?

Thank you, Bob. Good afternoon, everyone and thank you for joining us on today’s conference call. For my prepared comments, I will review our financial performance for 2010 and forecast for 2011. Discuss major accomplishments achieved during 2010 and highlight key milestones for 2011. To being, let me review our financial results for 2010 we achieved revenues of $286 million and net income of $52 million this financial performance reflects the strengths of our core Anthrax franchise and demonstrates our continued success in growing revenue from the sale of our flagship product BioThrax. This performance also reflects our continued ability to manage our overall expenditures while investing in the advancement for our pipeline of vaccines and therapeutics targeting key disease areas. These results also take into account our successful acquisition of Trubion in October last year. Also today we reaffirm our 2011 forecast for total revenues of $320 million to $340 million and net income of $35 million to $45 million. In 2010, we made progress on a number of key initiatives. First, let me address our accomplishments related to BioThrax I’m pleased to report that in 2010 we delivered 8.9 million doses of BioThrax to the strategic national stock pile under our current contract. This delivery level was achieved through higher than normal production yields combined with gaining an extra month production through a shift in the timing of our annual maintenance shutdown. Moreover in December we received notice that CDC intends to expand the current contract to allow for delivery for up to an additional 3.4 million doses of BioThrax. We are diligently working on securing this contract expansion. Beyond that, we continue discussions with CDC representatives regarding a follow on procurement contract. We anticipate this contract will cover a multi-year period and will be structured to secure…

Thank you, Fuad. Good afternoon, everyone. As Fuad mentioned following the close of the markets today, we released our financial results for the fourth quarter and full year 2010. I encourage everyone to take a look at the press release which is currently available on our website. We plan to file our annual report on Form 10-K with the SEC, no later than the close of business tomorrow, Friday, March 11. The 10-K will also be available on our website. Let me now briefly discuss the financial results. For the full year 2010, total revenues were $286.2 million comprised of $251.4 million of product sales and $34.8 million of grants in contracts revenue. Product sales revenue compares to revenue of $217.2 million in 2009. Product revenues were 16% above those in 2009 due to a 15% increase in the number of doses of BioThrax delivered which is a function of the higher than normal production yields combined with gaining an extra month of production through a shift in the timing of our annual maintenance shutdown. Contracts and grants revenues compared to revenue in 2009 of $17.6 million for an increase of 98%. For the fourth quarter of 2010, total revenues were $103.2 million compared to $53.8 million in 2009. For full year 2010, net income was $51.7 million or $1.63 per share. This compares to net income of $31.1 million for 2009. The increase in net income was a direct consequence of the increase in shipments of BioThrax throughout the year. For the fourth quarter of 2010, net income was $26.2 million or $0.78 per share compared to $4.2 million or $0.14 per share in 2009. With respect to gross profit margins for the full year 2010 our gross profit was 81% and increased year-over-year on an absolute basis due…

Thank you. (Operator Instructions) It looks like our first question comes from the line of Cory Kasimov with JP Morgan. Please proceed. Cory Kasimov – JP Morgan: Hey, good afternoon guys. Thanks for taking my question. First of all Fuad are you surprised that the follow on BioThrax procurement contract hasn’t yet materialized.

Thank you for joining us today Cory. No I’m not surprised at all. I think if you look back at previous follow on contracts that we received some of them were received only months before the end of the existing one some even months or two after. So but we are still confident that by the end of the second quarter we would have a that the RFP would be out and that we would be substantially complete with the negotiations on it and certainly we are confident that by the end of the third quarter we would have it executed. Cory Kasimov – JP Morgan: On that can you talk a little bit about the process and so the government issues the RFP and then you how long might it take once the RFP is out for you to negotiate a final contract.

Yeah, that’s a good question. So once the RFP comes out we will have then a clear definition of what the requirements are. We expect it to be a multi-year contract which we will try to secure substantial majority of our manufacturing capacity. So I will know the exact number we then basically sit down negotiate it’s not something we don’t have much experience within the contrary we’ve done this several times before. So it should be a relatively straight forward negotiation process and as the points of discussion should be relatively few. Because again we have had a several contracts not only with the DOD and then with BARDA but also previous contract with CDC. Cory Kasimov – JP Morgan: Okay, and then is there a risk that’s out there that could prevent a follow on contract from materializing at all and obviously there is a lot of talk budgetary pressures and things like that. But all the funds that would be there for this contract already the great project to you.

All indications we have had so far from CDC is that they are committed to issuing the RFP and we anticipate it coming out pretty soon. So and as our understanding is right now as far as the members of Congress are concerned if they understand and continue to understand the risk of an Anthrax attack. Eventually if you look at some of the reports that issued they say that you know there is a very strong likelihood of another attack. So nothing I have seen nothing that would indicate that the government would not continue with their procurement of vaccine. In the country that like us to scale up they continue to be very committed to our Building 55 scale up contract. So Cory there is really even in this environment where one might think that it might have some potential negative repercussions on the size and commitment of procurement and here we haven’t seen any of that. Cory Kasimov – JP Morgan: Alright, perfect. Thank you very much for taking that question.

Thank you, Cory.

Our next question comes from the line of Greg Wade with Wedbush. Please proceed. Greg Wade – Wedbush: Good afternoon. Thanks for taking my questions as well. Fuad with respect to the follow on contract is the requirement for an RFP a new piece of information?

Sorry, a new piece of information? Greg Wade – Wedbush: Yes, I wasn’t always.

The government always issues RFPs in advance of a solicitation in advance of a procurement. So this has been this is the case even with our developments contracts so it’s very, very typical it’s required actually to have an RFP that comes up.

Greg, this is Don I would add one thing this is going to most likely be a cell source procurement. The RFPs in the past have specifically called out BioThrax. Of course, we are the only ones that can supply BioThrax but, as Fuad says, this is standard operating procedure for the government.

That’s a good point, Don, because there are two types of RFPs one an open RFP and the other one is kind of a sole source type of RFP. Greg Wade – Wedbush: And then with respect to some work that’s being done in manufacturing could I just get a little more granularity into this reference testing versus release testing work. And then during the time that this release testing I guess is going to be unavailable for release of manufacturing will the company still be able to manufacture BioThrax for release later and or just to build up sort of a bowl of material that can help you to achieve your full year numbers is that the case.

Yeah, that’s a very good question and to be clear we are continuing manufacturing sub lots are being manufactured. We are formulating lots to a while we are deploying the potency testing capacity to qualify additional reference lots. We obviously cannot release and until new reference lot is approved you know we will continue to release test and then put after we’ve completed that exercise we would continue to release test and once that approval is in place release those lots. Greg Wade – Wedbush: Great, thanks for the clarification.

Our next question comes from the line of David Moskowitz with Madison Williams. Please proceed. David Moskowitz – Madison Williams: Yes, hi good afternoon. Just a question on the release you guys talked about reaffirming your guidance driven by a number of items and you did talk about milestones from the Trubion partnership assets so I’m wondering is that necessary for you to meet your guidance to get milestones from those partnerships. I guess is that included in the $65 million to $75 million guidance for grants.

Yes, it is. It contributes it doesn’t contribute largely but it does contribute. David Moskowitz – Madison Williams: Okay. Now, you are willing to give us sort of a rough percentage of what that means in the grant guidance.

No, we don’t really go into that granularity in providing this information. David Moskowitz – Madison Williams: I appreciate it Fuad. But if I can just you know you are saying it a small contribution so you know roughly 10% to 20% or is it in the higher end like 50% or something like that.

It doesn’t; it contributes but it’s not the major contributor. David Moskowitz – Madison Williams: Okay, so will it be possible to meet the low end of that guidance if you didn’t get the milestones.

Well, you know, it’s a combination of factors that we very carefully calibrate and estimate that we have several contract several collaboration agreements that you know each one single factor may not necessarily cost any deviation from the range. Obviously if there are several things that happens simultaneously we might but we will inform you if we feel that you know our outlook and views change in the future. David Moskowitz – Madison Williams: Okay, I appreciate that and in terms of the BioThrax capacity expansion on Building 55. Are you able to give us an update on how that’s progressing and what’s the next what kind of milestones we could expect over the next couple of quarters?

Yes certainly it’s progressing quite well and I would say you know in the meetings we have with BARDA they are satisfied with the progress we are making we hope to be able to initiate manufacturing of the consistency loss for the scale of BioThrax by the end of this year. So that is a key milestone that we are very, very excited about. David Moskowitz – Madison Williams: Excellent. Thanks for taking my questions and congratulations on a good quarter.

Thank you, David.

(Operator Instructions) Up next, we have Eric Schmidt with Cowen. Please proceed sir. Eric Schmidt – Cowen: Well thanks good afternoon I missed the first few minutes of the call Fuad so forgive me if I’ repeating. But the reason for the most delay in the procurement contract for BioThrax from Q1 say into Q3 is that basically because you are given this 3.4 million dose extension and that I guess takes the pressure off the government in terms of timing and delays the steps saying for the RFP from being.

Well, first of all, we haven’t secured the 3.4 million extension of the existing contract yet. You know that’s notice has been out and you know we’ve been negotiating and we expect this to be done shortly but it’s not finalized yet. But certainly you are right that is puts you know less pressure on getting the follow on contract signed well in advance. Because you know the follow on contract now can comfortably start in the fourth quarter of 2011. Eric Schmidt – Cowen: Okay, and what in terms of the negotiation on the 3.4 million extension is sort of rate remitting I thought that you had a good sense of price already in that extension.

Well you know, we are really not comfortable sharing with you all the specific details but every contract you know whether it’s with a government or a commercial party has several points that are being negotiated. So all we can comment is that we hope that we will execute this contract in the very near future. Eric Schmidt – Cowen: Okay. And in terms of the process on the next generation multi-year BioThrax contact, you mentioned the RFP comes out in response to a previous discussion you sort of indicated that in point you began discussions of negotiations. But I thought that you’ve already had fairly advanced discussions about the terms and size price per dose and things like that.

Being for the follow on contract. Eric Schmidt – Cowen: Yeah.

Yeah, so Eric that’s right I mean we have the government has asked for us you know what’s our capacity comfortably you know we gave them the range and that you know we would very much like to have a multi-year contract five years. So we submitted that information to and some other information that they’ve requested to CDC and I believe they are taking that into account in finalizing the issuance of the RFP. Eric Schmidt – Cowen: Okay, so that will be a starting point when you negotiate the finer details from there.

Yeah, exactly. Eric Schmidt – Cowen: Okay, and then in terms of the new potency testing capabilities in capacity can you maybe go into a little bit detailed about what exactly you doing there and is that impacting our margins at all.

Sure, so potency testing is part of what is required to release each and every lot. We get approval from we submit the potency information to FDA and we get approval on that submission and then the lot is ready for release. For the last couple of months we’ve kind of redeployed the potency testing capacity to qualify additional reference lots which is required and for future releases and while that is taking place. Eric Schmidt – Cowen: I’m sorry, Fuad, I’m not sure I understand what that means and kind of in English.

Okay, so where would you like me to start. Eric Schmidt – Cowen: Well, redeploying new potency testing to validation lots I mean I understand every lot has to be potency testing but what’s actually changed here related to what you are doing last year.

Okay. So when a lot is ready to be potency tested, it goes into the potency testing facility for the testing. Now their testing facility is basically not available for release testing because we are testing or qualifying I should reference lots. So those are reference standards that are required for future potency testing. So while we are doing that it’s using up the capacity we can’t be using up, we can’t be releasing you know testing manufactured lots for release. So you know we’ve looked at that and we’ve looked at the impact and we’ve looked at the projections so it impacted first quarter because we started giving revenue guidance for the upcoming quarter we explain this as being an important reason why we feel that in the next in the second, third and fourth quarter it will ramp up. But the guidance was build based on every quarters performance as we have anticipated and the ramp up as we anticipate for the rest of the year. Eric Schmidt – Cowen: So clearly, you have been manufacturing lots during this period of redeployment as you mentioned.

Yes, absolutely. Eric Schmidt – Cowen: You don’t yet know; you don’t yet know which of those lots have failed or passed testing however.

Correct, they are waiting testing. Eric Schmidt – Cowen: Okay, thanks for the clarification.

To your question, Eric, with regards to gross profit, as you know in a process manufacturing like this is gross profit is really determined over the course of full year of manufacturing. We are not estimating that this is, this takes us outside of the range that I talked to earlier on the 70% to 80% gross profit margin. Eric Schmidt – Cowen: That range, Don, is obviously lower than which achieved last year is this your typical conservative nature or which is.

Guilty as charged. Eric Schmidt – Cowen: Fair enough. Okay, I think that’s it for me. Thanks for taking the questions.

Thank you, Eric.

Thanks, Eric.

(Operator Instructions) Ladies and gentlemen, this will conclude the Q&A portion of the call. I would now like to turn it over to Mr. Burrows for closing remarks.

Thank you, Jeff. Ladies and gentlemen, that concludes today’s call. Thank you for your participation. Please note that today’s call has been recorded and a replay will be available beginning later today through March 24. Alternatively, there is available a webcast of today’s call an archived version of which will be available later today, accessible through the company’s website. Thank you again and we look forward to speaking to all of you in the future. Good bye.

Ladies and gentlemen, that concludes today’s conference. Thank you for your participation. You may now disconnect. Have a wonderful day.