Good day, ladies and gentlemen and welcome to the Fourth Quarter 2011 Emergent Biosolutions Earnings Conference Call. My name is Jeremy 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). I would now like to turn the conference over to your host for today, Mr. Bob Burrows, Vice President of Investor Relations.

Thank you, Jeremy. Good afternoon, ladies and gentlemen, thank you for joining us today as we discuss Emergent BioSolutions fourth quarter and full-year 2011 financial results. 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 am 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 or 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 potential risks and uncertainties. Actual results may differ materially from those projected in any forward-looking statements. You’re 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 who may be listening to the reply, this call is held and recorded on March 8, 2012. Since then, Emergent may have made announcements relating to topics discussed during today’s call. So again, please refer to 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\Special Events. 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 our call today. For my prepared comments, I will review our financial performance for 2011, address the forecasts for 2012, including revenue expectations for the first quarter and discuss the current status of the company. To begin, let me review our financial results for 2011. For the full year, we achieved total revenues of approximately $273 million, which is within the $270 to $275 million range we provided in January. In addition, we realized net income of $23 million, which is within the $20 to $24 million range, we previously provided. At year end, we held cash and accounts receivable of $220 million. Looking ahead, we are reaffirming our full year 2012 guidance of total revenues of $280 to $300 million, a split between product sales of $220 to $230 million and contracts and grants revenue of $60 to $70 million. We are also reaffirming our full year 2012 net income of $15 to $25 million. In addition, we anticipate first quarter 2012 total revenues of $40 million to $50 million. Turning now to the status of the company. Let me first talk about our BioDefense Division. In 2011, we continued to manufacture and deliver as many doses of BioThrax into the SNS as possible. To that end, we completed deliveries under the prior 17.9 million dose contract and began deliveries under the new CDC contract. The new contract, which was awarded in September is for approximately 45 million doses valued at up to $1.25 billion to be delivered to the SNS through September 2016. This is a significant commitment by the U. S. government and further affirms BioThrax as a critical component of the government’s biopreparedness arsenal for years to come. In response to the government’s…

Thank you, Fuad. Good afternoon everyone. Before I get into the financial results, I would like to congratulate Fuad on his final earnings call and thank Fuad for his support and leadership to the company since its founding. So, following the close of the markets today, we released our financial results for the fourth quarter and full year 2011. 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 9th. The 10-K will also be available on our website. Let me now briefly discuss the numbers. Full year 2011 total revenues were $273.4 million versus $286.2 million in 2010. 2011 revenues were comprised of $202.4 million of product sales, a decrease of 19% over the prior year and $71 million of contracts and grants, which is an increase of 104% over the prior year. The lower product sales in 2011 is primarily due to our decision in the first quarter as you recall to redeploy our potency testing capacity from BioThrax release testing to qualification of replacement reference standards and other development testing, as well as to lower production output we experienced during first half of 2011. Production output improved over the remainder of the 2011 production period, which led to increase product sales, as evidenced by our fourth-quarter product revenues of $81.6 million. Moreover, fourth-quarter 2011 total revenues were $107.9 million compared to $103.2 million in 2010. Turning to gross margins, our full year 2011 gross margin was 79%, a slight decrease over 2010. Our expectation for gross margins remains within our historic norm of between 70% and 80%. Turning to the bottom line full year 2011 net…

(Operator Instructions) Our first question comes from Cory Kasimov, please proceed.

Hey, good afternoon guys. Thanks for taking the questions and Fuad (inaudible) my congratulations to you on your retirement. First of all at BioThrax, with regard to the upcoming consistency lot manufacturing of Building 55, how long do you expect those runs are going to take and how do think you will or how you’re expecting to disclose the result?

Thank you Cory, for your kind words. To answer your question, we are in the process of gearing up consistency lot manufacturing. We have in addition to the consistency lots of course, non-clinical studies that need to be completed and will be continuing to manufacture in this facility to keep it warm and to build up an inventory of product. Should we then be licensed in late 2014 to early 2015, we actually would have some product available for delivering.

Okay. And then on the model, two quick questions. One is on your first quarter revenue guidance of $40 million to $50 million, seems kind of low relative to your full-year guidance. Is this once again being driven by lower yields to start the year, is it something having to do with timing of deliveries or contract revenue or something else? And then the second one on the model, of your planned R&D spend in 2012, can you provide a rough split of how much is attributed to bio-defense related to bio-sciences? Thanks.

Yeah. Let me take your first question, first which is Q1 guidance. If you look back historically at our first quarter, it has always been less than average and the reason being is that we do our annual shut down for maintenance – annual maintenance every year in the September, October timeframe. So given that four months – of production cycle, the months, the four to six weeks that we’re shutdown usually demonstrate themselves in the first quarter. So historically the first quarter is always a bit less than average. And with respect to the R&D spend, we don’t really break that down in terms of (audio gap). Are you still there?

Our next question comes from Eric Schmidt. Please proceed.

Good afternoon. And congratulations, Fuad, to you as well on your new role. I sounds like you were spending a little bit more time focusing on strategy and I guess I’m just wondering what exactly that might entail, whether you’ll be looking more closely at cash redeployment, M&A, buybacks, dividends et cetera or maybe you could just describe a little bit more how you will be functioning with the company.

Thank you, Eric for the congratulations. I do look forward to transitioning to the new role and in that new role, I will be focusing mostly on the M&A piece. Of course with it – it has strategic, continued strategic development, we have a strategic plan that the entire executive team has worked very closely together and we are all aligned and we are executing and our strategic processes that we’re implementing and have implemented to make sure that the process, the growth process is optimized within the organization. M&A is something that we’ve been going through mergers and acquisitions, and in the last two years, we remain acquisitive and I’ll have now more time to personally spend on evaluating candidates and then once we’ve identified the right targets and hopefully to negotiate and complete the deal.

Okay. Another question for Don, on the tax rate tweaked up to 41%, I think in the year 2011. Could you discuss why that might be and kind of providing a sort of directional guidance that you might want on 2012?

Sure. If you take a look back over the past X number of years. You’ll see that our tax rate has generally hovered around 40%. Now, in 2010 they were a number of different adjusting activities, some from prior years et cetera that caused the rate to be below 40% for 2010. But as we take a look at our overall tax profile and unfortunately we don’t have the luxury of certain foreign operation due – If you will shelter some of this income, a 40% is pretty much what we expect on average year-over-year, until such time as we get into a different profile of either states or different countries that we’re doing business in.

Eric, rest assured that we had a merchant try to manage our taxes as best as we can. And we have some external advisers to see to validate what we’re seeing here, unfortunately that’s the place we’re in right now and we always look at opportunities to reduce taxes, but that’s where we are.

Yeah. We pursue aggressively all of the R&D tax credits, manufacturing deduction credits, et cetera, et cetera and it still comes out to be right around 40% on average.

Okay. And then last question on BioThrax. It looks like in the fourth quarter sales were down about 9% on volumes that were down a little lessen at 6%. So, is that the difference between the other the delta of 3% that the difference in price between old and new contracts or partial difference price?

You’re seeing some of the ramifications, so that, yes, Eric.

Okay. Thanks a lot guys.

Thank you, Eric.

Thank you, Eric.

Our next question comes from Mario Corso, please proceed.

Yes, thanks for taking my question and I (inaudible) congratulations to Fuad. I guess on the yield issue, I understand what you are saying about the shutdown in Q1 impact, but given what you’ve seen lately maybe you feel good about where yields are and your ability to produce the 8.5 million doses for this year and then a couple of things, modeling was, gross margin and contract revenue both jumped quite a bit in the fourth quarter, I’m wondering if there was anything in particular happening there? And I’m also wondering if there is any progress potentially re-partnering through ‘16? Thanks.

Thank you, Mario, for the wishes. So to start with the first question on the yield, we are very pleased with the progress we’re making in addressing the yields issues that we encountered last year, we are looking at processes that further optimize process and minimize that the chances of experiencing other lower than expected yield year. As I’ve always said that there is inherent variability in the growth characteristics of implementation process and when you produce a biologic – so and that range has been 7 million to 9 million doses a year, well it hopes to be at that higher range and we’re taking steps to again increase the probabilities to get back out there. Now with respect to the margins, why don’t I ask Don to address that issue?

Yeah. When you take a look at margins generally speaking and as we referenced in the comments, we expect gross margins at least with regard to product to stay on the 70% to 80% and if you go back over the past couple of years, you’re going to see that that has remained in that range rather consistent. And in any given quarter, yes, could you see it spike up a couple of percentage points, an awful lot of that is, as Fuad mentioned, a four-month production cycle, you’re going to see certain activities that are impacting gross margins that actually happened a number of months before depending upon how inventories are moving. With respect to contracts and grants, I think as you take a look at the significant government contracts and grant, you’re going to say – see that (inaudible) building 55 generally our accounting for a very large proportional contracts and grants and on any given quarter, you’re going to see those go up and down. Now, a particular influence in fourth-quarter was recognition of contract and grant activity associated with Abbot. And so that is going to show that a little bit more spiking in activity in fourth quarter than normal. And you’ll see all that in the K.

And to the third question as to, partnering potential for 2016, we continue to be excited about that candidate. The – as we’ve reported earlier, are ongoing and we hope that the results will be promising so that we can continue development of 2016 in both disease areas. We are open to repartnering, we are looking at first generating the results and then evaluating the best timing to evaluate the whole partnering strategy.

(Operator instructions). Our next question comes from Jason Canter. Please proceed.

Thank you for taking the question. I’m getting a little feedback on my line-out, it’s not on yours as well. Just on the 2016 program, can you give us a sense of when you expect to get the efficacy data there, and then what kind of hurdles are you looking for in order to take that going forward, I mean is it becoming a very competitive space where you’re looking, so I’m just wondering. I assume we’re going to see activity, the question is how much activity do you need to see to warrant moving forward?

Thank you, Jason. I have sitting here next to me Dr. Scott Stromatt, who is our Chief Medical Officer and he is very familiar with the trials associated with the 2016. So I will ask him to give you a greater detail.

(Inaudible) finished Phase 1b enrollment. You’ll see that data at APS this year. We will continue enrollment Phase 2, finish that this year so we’ll have topline data next year and then obviously more data at the end of probably 2013 at one of the medical meetings. In terms of the efficacy hurdles, usually in oncology like 30% to 50% difference in our sample size (inaudible).

Thank you, Scott.

At this time, there are no questions queued up. I’d like to handle it back to Mr. Bob Burrows.