Emergent BioSolutions, Inc.

The class action, led by Partner Matthew L. Tuccillo, stemmed from Emergent’s alleged misrepresent-ations to the markets relating to its disastrous COVID-19 vaccine manufacturing failures.

When the COVID-19 pandemic struck, Emergent seemed uniquely positioned to capitalize, as the U.S. government had designated its Bayview facility in Baltimore, Maryland, as one of just three in the United States pre-authorized to ensure a supply of vaccines in a pandemic. In short order, Emergent signed contracts worth over $1 billion with the U.S. government, Johnson & Johnson, and AstraZeneca, to manufacture the raw material – bulk drug substance – for the two companies’ COVID-19 vaccines. Due to simpler dosing and refrigeration needs than mRNA alternatives, these vaccines were poised to be a significant element of the U.S. global response to the pandemic.

Unbeknownst to investors, Emergent’s Bayview facility had serious, longstanding deficiencies in equipment, personnel, training, and processes, particularly in regard to its anti-contamination capabilities. This materially increased the risks of catastrophic errors that could derail its COVID-19 manufacturing process.

Emergent and its executives concealed these substantive negative facts from the public during the class period, while touting the Bayview facility’s readiness to rapidly engage in large-scale manufacturing of both the J&J and AstraZeneca COVID- 19 vaccine bulk drug substances. Meanwhile, as Emergent raised funds via a public offering, its CEO – who had not sold a single Emergent share in four years – revised his Rule 10b5-1 stock trading plan to sell over 88,000 shares in a three-week period. By selling these shares at prices near the class period highs, he reaped over $11 million.

The aforementioned flaws, which rendered the Bayview facility unsuited for the urgent COVID-19 vaccine manufacturing role, were later revealed by The New York Times and the Associated Press, multiple Congressional reports, and Pomerantz’s interviews of numerous former employees and its review of extensive regulatory documentation. When The New York Times reported that Emergent had cross-contaminated a batch of J&J bulk drug substance with AstraZeneca material, Emergent and its CEO initially denied that any cross-contamination had occurred.

The U.S. government halted production of the AstraZeneca vaccine at Bayview and handed control of the facility to J&J before finally ending all COVID-19 vaccine manufacturing there, as Emergent’s lucrative contracts were terminated. Ultimately, Emergent’s failures resulted in the destruction of 400 million out of the 500 million COVID-19 vaccine dose-equivalents ever produced at the Bayview facility, a stunning failure. The revelations of incidents where deficient procedures, insufficient training, and lack of compliance at Bayview resulted in batches of J&J or AstraZeneca bulk drug substance being discarded due to bacterial or other contamination, suffocation of cells, and other failures, caused Emergent’s stock price to plummet and investors to suffer huge losses.

Pomerantz’s clients, the Nova Scotia Health Employees’ Pension Plan and the City of Fort Lauderdale Police & Firefighters’ Retirement System, were appointed Co-Lead Plaintiffs to oversee this important litigation. Mr. Tuccillo and his Pomerantz team litigated and overcame a hard-fought, voluminous motion to dismiss after a lengthy oral argument. Thereafter, Pomerantz zealously built the evidentiary record by pursuing written and document discovery from defendants, subpoenaing third parties like J&J and AstraZeneca and serving records requests (FOIA and international equivalents) to U.S. and foreign regulators. Pomerantz secured and reviewed nearly 120,000 documents and deposed a dozen Emergent executives and employees. Pomerantz also filed a motion for class certification, supported by an expert report on market efficiency and damages, which the court granted.

After the court granted preliminary settlement approval, Pomerantz oversaw a robust, class-wide notice program, which resulted in over 130,000 mailed notices, 27,000 settlement webpage visits, and 64,000 class member claims submitted – without a single class member objecting to any part of the settlement. The overwhelmingly positive response is not surprising. The settlement represented a recovery as high as 12.75% of class-wide damages and compared extremely favorably both to comparable settlements within the judicial Circuit and to national settlements data from 2014-2023 as compiled by NERA and Cornerstone Research.

“We are pleased that the court granted final approval of this important settlement,” said Mr. Tuccillo. Judge Boardman ordered a brisk litigation schedule, carefully oversaw our progress, and closely scrutinized our settlement. The settlement is an outstanding result and secured the vast majority of available insurance coverage for the benefit of Emergent’s damaged shareholders. Credit goes to our clients, who produced documents, oversaw our work and authorized a strong settlement for the benefit of the entire class.”

Partner Matthew L. Tuccillo led the Pomerantz team that included Of Counsel Jennifer Banner Sobers, and Associates Jessica Dell, Villi Shteyn, Brandon Cordovi, and Zachary Denver.