S&P Global Ratings downgraded Emergent BioSolutions Inc.'s outlook to negative from stable, citing intensifying competition in the nasal naloxone market and weaker-than-expected sales of its flagship opioid overdose reversal drug NARCAN.
The issuer credit rating for Emergent BioSolutions was affirmed at 'B-', while its issue-level rating on unsecured notes was maintained at 'CCC+'. The downgrade follows the company's announcement that it had lowered full-year 2026 guidance due to pricing pressure from two new market entrants and reduced demand for NARCAN.
Revenue guidance for 2026 was cut by $80 million at the midpoint, while adjusted EBITDA guidance was reduced by $25 million. S&P projects the commercial segment revenue will decline by approximately 25%, with the medical countermeasures segment contracting by roughly 2%. Despite these pressures, S&P expects EBITDA margins to remain stable at around 18% in 2026 and 2027, down from a peak of 32% in 2025.
The rating agency attributed the 2025 margin high to a single high-margin order for ACAM2000, a smallpox vaccine. Emergent BioSolutions has initiated cost-reduction measures, including workforce reductions, to partially offset the revenue decline.
Emergent BioSolutions faces $440 million in unsecured note maturities due in August 2028, currently rated 'CCC+'. As of July 2026, the company held approximately $280 million in cash, supported by strong accounts-receivable collections, and maintained full availability under its $50 million asset-based lending facility. The company also announced a $75 million debt repurchase agreement.
