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The Biggest Loser With Johnson & Johnson's COVID Vaccine Manufacturing Woes

By Keith Speights and Brian Orelli, PhD - May 6, 2021 at 6:01AM

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It's obvious.

Although Johnson & Johnson's (JNJ -1.10%) COVID-19 vaccine is no longer on pause, the healthcare giant still faces some major production challenges. In this Motley Fool Live video recorded on April 21, 2021, Motley Fool contributors Keith Speights and Brian Orelli discuss the biggest loser with J&J's COVID-19 vaccine manufacturing woes.

Keith Speights: We've had news already about the Baltimore facility that was manufacturing Johnson & Johnson's COVID-19 vaccine being shut down while an FDA inspection was under way. Well, reports surfaced today that the FDA has now completed that inspection, and it wasn't pretty, they had some real issues with this facility. The facility remains closed for now.

This is obviously bad news for Johnson & Johnson because the vaccine is not being manufactured at this facility, now. Brian, who would you say is the biggest loser with this fiasco?

Brian Orelli: I mean, it's obviously Emergent BioSolutions (EBS 2.04%) because it's their facility. They're certainly just as big of a loser as Johnson & Johnson, probably more so because in addition to not generating revenue from making Johnson & Johnson's vaccine while it's been shut down. They are also not generating revenue from AstraZeneca's vaccine.

They were making them together and that was what caused the reported contamination. Then the government stepped in and said, you know, just make Johnson & Johnson's only here, so AstraZeneca got kicked out and then you know closing down the plant also, is a stain on Emergents' reputation and Emergent has gone from the pandemic darling to the ugly duckling.

Speights: Yeah, and I saw reports from, I guess it was yesterday. It's getting even worse for Emergent BioSolutions. Now there's a congressional panel, that's investigating whether or not the company was improperly awarded the federal contract of over $600 million. I think there's a house committee wanting to call Emergent's CEO to testify. It's never good when your CEO is called to testify before a congressional committee.

Orelli: No that's never. 

Speights: Never. It's never a good thing. Okay. Yeah, Emergent BioSolutions just has a huge black eye from this. Obviously, it's impacting Johnson and Johnson as well, but not nearly to the extent. We'll continue to watch the story for sure to see what happens.

Brian Orelli, PhD has no position in any of the stocks mentioned. Keith Speights has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Emergent BioSolutions. The Motley Fool recommends Johnson & Johnson. The Motley Fool has a disclosure policy.

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Stocks Mentioned

Emergent BioSolutions Inc. Stock Quote
Emergent BioSolutions Inc.
$30.50 (2.04%) $0.61
Johnson & Johnson Stock Quote
Johnson & Johnson
$165.30 (-1.10%) $-1.84

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