Great. Welcome, everyone. My name's Jessica Fye. I'm a biotech analyst at J.P. Morgan, and we're continuing our 44th annual healthcare conference today with Emergent. First, you're going to hear a presentation from the company, and then we're going to have some Q&A. So for those of you in the room, if you want to ask a question, just raise your hand, so someone will bring you a microphone for the webcast. And alternatively, for those listening online, you can submit questions via the portal, and I can read them off the iPad up here. So with that out of the way, let me pass it over to Emergent's CEO, Joe Papa.
Thank you. Good afternoon, everyone. Welcome to the Emergent presentation. It's my pleasure to talk to those of you here today in the room and those on the webcast. Emergent's a 25-year-old company. Our mission is to protect and save lives. We have, in 2024, started a multi-year turnaround plan, and it's my pleasure today to update you on our progress of where we are with that turnaround plan and just what we see for the future. So let me go to the—this is just our safe harbor statements. I'll be making some comments today that I'll refer you to our SEC filings for any additional information and risk factors for you. So what's the overview of Emergent? Emergent's a company, as I mentioned, 25 years old. We have two primary business areas that we focus on. The first is what I refer to as biodefense.
We have the leading portfolio of biodefense products. All told, we have about 11 biodefense products. We protect against very serious threats, and we work with the U.S. government and other governments around the world to protect with vaccines and therapeutics for areas like smallpox, anthrax, botulism, Ebola, so some really serious problems that potentially could be out there as threats. We do the products that work to make sure that those products are available in any time of need. So that's the first area. Our second area is we treat opioid overdoses. We are the market-leading company with a product called Narcan for the treatment of opioid overdoses. So let me go to this next page here, and here we go. Let's talk more about some of the specifics of the business. First and foremost, we view that we live in an increasingly dangerous world.
We want to help governments, both the U.S. and around the world, prepare for today and tomorrow's threats. As we think about the business, we are focused on really making sure we have a diversified business. So we have both the opioid overdose products as well as the biodefense products. But we purposefully, over the last several years, have looked to improve our diversification. We've increased our focus on countries around the world outside of the U.S. And indeed, today, we're about 30% rest of the world, about 70% U.S. revenue in terms of what we do for our medical countermeasure products. And as I mentioned, we have about 11 products, 900 employees that are focused on making sure that we help protect against serious global health threats around the world. That's the company. This is our team. We have an experienced and trusted management team.
We have over 100 years of individual experience in the healthcare pharma space. We built an experienced team and are delighted to have a chance to work with this team. Myself, I spent over 40 years in the pharmaceutical industry, about 15 years with a company called Novartis, 10 years with Perrigo, and then seven years with what started as Valeant and turned into Bausch Health and Bausch and Lomb, and I joined Emergent about two years ago to help with the turnaround efforts and join the team. If I go to the concept of what I mentioned at the onset, we're in the very early stages of a multi-year turnaround. We've been at this approximately two years. Our plan is to first stabilize the company, which we did in 2024 and 2025. The next phase beyond that is a turnaround phase.
And then ultimately, in 2026 and beyond, we're focusing on transforming the company. Let me spend a few minutes on the stabilization phase and what we accomplished and what we're trying to do. First and foremost, our goal was to streamline the organization. We divested about $150 million of sites and products to help us to improve the overall performance of our business. We reduced operating expenses. We reduced operating expenses by about $250 million. We also, as a result of these actions and deciding where to invest in the business, we were able to increase our Adjusted EBITDA. In 2023, it was negative. 2024 was $183 million. And our projection for 2025, we haven't announced yet, is somewhere in the $195 million-$210 million.
So we made some really nice progress in the overall turnaround of the business starting in 2024, but still, clearly, there's a lot more to do. We've also had the need to restructure our debt and to reduce debt. Since 2023, we've actually reduced our total debt by about $275 million from where we started. So a lot of good work was done by the team to make that happen. Now, in 2025, 2026, we're focused on the next phase of the turnaround, and that's all about where can we make investments for growth. What are the opportunities? And really, it breaks down to a couple of different areas. Number one, for growth, we're looking at investing for organic growth. That is for some of the leading products we have, products that are therapeutic products for anthrax, therapeutic products for smallpox. We have a product for Ebola called Ebanga.
Those are areas that we're investing today for the future. The other area that I mentioned briefly I'll talk about is we're investing for geographic growth. We're looking to expand our geographic footprint. We made some investments in 2024 and 2025, and that's helped us to significantly increase our sales and revenue outside of the U.S. And then finally, we're looking at inorganic growth in terms of what can we do for business development. And that's the concept of where we can invest for the turnaround phase. And then finally, in 2026 and beyond, our view is we're going to transform the company to have a long-term, sustainable, durable, profitable company for the future. And that's what we're looking to do with the transformation phase of our company.
So if I talk now specifically about medical countermeasures, we have the most diverse biodefense medical countermeasure business in terms of what we do, in terms of the product portfolio. As I mentioned, 11 products. We address the number one viral threat, which is smallpox. We have a vaccine and a therapeutic for smallpox. We address the number one bacterial threat from a terrorist point of view, and that's for anthrax. We address the number one most toxic compound is botulism, and we have a solution for that. And the focus areas that we go after are all based on having some specific conversation with the U.S. government in terms of what are they looking to do. And we work with them directly to do the R&D that's required for these products, submit the products, get approval, and then work very closely to stockpile our products with the U.S.
Government and, as I mentioned, other governments around the world. So that's how we do it. We think it's a very durable business because if you think about what we do, we clearly make these products. They're difficult to make, of course. But beyond making the product, we also put together services for the governments that we work with so that we can also do the potency testing for these products. We also look at stability testing for these products. That incremental testing really makes us a part of the ecosystem of the U.S. government, and we think that's an important part of why these products are very durable.
And by the way, it's unlikely that any governments around the world want to have multiple players putting together an anthrax product, which means that you have to have access to anthrax spores, which are potentially very lethal and could cause significant problems if one of them was to have a problem in a lab or, heaven forbid, somebody takes it and develops into a terrorist weapon. So those are the reasons why we think we have a very durable business, and that helps us as we think about the future of what we do at Emergent and, importantly, what products we're looking at for the future. If I asked you about your concerns in areas of terrorist threats, one of the ones that probably would come to your mind is, of course, the nuclear threat.
That's obviously, clearly a big issue and one that we're all very sensitized to. If I wanted to share with you what we've also found out, one of the things we've done is talk to 250 experts in policy and talk to them about the information about terrorism and bioterrorism. 65% of the policy opinion leaders say the threat is rising in terms of being worried about terrorism. As I mentioned, I think we're in an increasingly dangerous world. Some of the other things that have come out of the information is that, excuse me, many of them believe a biological threat is even more worrisome than a nuclear threat. Obviously, we all understand the nuclear threat, but a biologic threat could be, in fact, very difficult for us. They're easier to carry out. They're faster to carry out. They're less expensive to carry out.
If some dictator around the world wanted to create problems, a biologic threat could create chaos. We believe it's important that we are prepared. As you can see from the data here, nearly nine in 10 of the experts believe it's important for the U.S. to take a leadership position in making sure that we are prepared. The good news, the very good news, I believe, is that, fortunately, we have bipartisan congressional support for the U.S. to maintain a leadership position in biodefense. We think that's an interesting point, an important point. It's not often that you're in healthcare and you can say that we have bipartisan support for one of our pillars. In fact, we believe at the Emergent company, we have bipartisan support both for the biodefense side of our business and for the importance of controlling the fentanyl overdose problem.
So we're excited to be part of two really important areas and ones that do have bipartisan support. If I go to the next page, what I think we wanted to share here is really talking about our presence of our products in this increasingly dangerous world. We've streamlined our manufacturing facilities. We have two main facilities, one in Lansing, Michigan. The other one is in Winnipeg, Canada. And then we have a couple of other facilities in both the Boston, Massachusetts area, and the Washington, D.C. area that help us. But we have streamlined the facilities. We're down to those two major hub facilities and then some additional supplemental facilities. But we still remain capable of delivering all of our products in the U.S. through either manufacturing here in the U.S. or our Winnipeg facility as a US MCA-compliant facility
that ensures that we're okay with any tariff implications or other activities. An interesting fact for us at Emergent is that you may have heard that the U.S. administration is already concerned about ensuring that we provide to the U.S. government a most favored nation pricing. And I'm delighted to say that Emergent is ahead of the schedule in that. We know that all of our products that we price, we give the U.S. government a most favored nation pricing versus what we charge other governments from around the world. So we're way ahead in that score. One of the other questions that often comes up is, and we've mentioned about what we're doing ex-U.S., we do believe that this crisis or concerns about terrorist threats are not just U.S.-based. There are increasing concerns in Europe and Asia.
So what we've done is worked very diligently to ensure that we would help other countries around the world with their needs for making sure that they have the available products. And as I mentioned before, we've now increased our revenue from outside the U.S. from about a 15% area to somewhere in that 34% area. So significant improvement in what we do to make sure that we are diversifying our business. That's, we think, is important. I think we all know what we're doing in the U.S., but we also know that Europe is also looking at increasing their preparedness. They're actually looking to the U.S. to help them with this whole concept of a Strategic National Stockpile. And our team is helping the European leaders as well as they think what needs to get done.
And importantly, notwithstanding a government shutdown last year, we were able to deliver and gain access to contract modifications with the U.S. government to ensure that we are always ready to supply products to them that they needed for the stockpile. And we take the chance to meet regularly with individuals from BARDA, Strategic National Stockpile, and the Department of War. Our other business is also a very important business, is what we do for opioid overdose. And it truly is an epidemic, so much so that President Trump signed an executive order in December of 2025 designating illicit fentanyl and its core precursor chemicals as weapons of mass destruction. So you can see how these businesses are coming together in terms of what we do for biodefense, but also what we do for the opioid overdose issue. So we believe it's important.
We're doing everything we can to help in the area. The data is significant. If you think about what's happening, there's too many people dying from overdoses. In 2023, the number of people dying from overdoses is about 100,000 people. In 2024, it declined to about 80,000, and we know of those 80,000, about 80% are dying from opioids specifically, so it's a big issue. We believe that the availability and the steps that Emergent took to work with the FDA to make the product Narcan available over the counter was an important part of increasing access and reducing the deaths, and we believe that the facts are that if somebody overdoses, you have a limited amount of time to make sure that you help them to prepare to get treatment, and we do that by trying to increase access.
In our world, the way we view this is that we believe we've got to help the society until there's no more opioid overdose deaths. In fact, if we can have one Narcan in every person's home, just like a fire extinguisher, we hope you never need it, but it would be available if somebody needs an overdose on a product. We think that would be an appropriate opportunity for us as we think about the future. Earlier today, we made an announcement that we continue to look for innovation in the Narcan opportunity. We are delighted to say that we announced today that we launched, and we just got approval from the FDA to have a Narcan pack. It's a backpack.
You can imagine that you can clip this onto a backpack and what that will give patients, especially potential users, people that need the product, better access to the product, especially if you think of college students. If something unfortunately happens to a friend or a relative, they'll have product available. They can save a life. We think that's an important part of helping to lower the overall death rate to opioid overdoses, so we're delighted to announce that innovation today. We just did a release. We just got it approved by the FDA. We think it can help. We think it's another part of leading and being an innovator in opioid overdoses. What can we do? We're going to continue to try to innovate and come up with new solutions.
As we think about the future, I talked about 2026 and some of the things we're doing to invest in growth. We've got a number of different things that we're advancing in terms of looking to see how we can grow the totality of our business, everything that we're doing, not just in one part of the business, but clearly in the biodefense, but also in the Narcan business. One thing we did last year is we announced a partnership with RocketVax. They're a Swiss pharmaceutical company. They have some very interesting technology. That's a very fast development of vaccine for viruses. What makes them really unusual is that they're very fast to develop, but they also deliver immunity that lasts because they are live attenuated virus vaccines. So we think it's a really important part in that particular project is getting some funding from the NIH for next-generation technology.
We also announced last year an agreement with Hikma for Kloxxado. Kloxxado is a higher dose of naloxone. We think that's important because it's good to have, as a leader, the most wide offering of products for patients in the space. So we're continuing to advance that. We also, I mentioned before, we're looking at continuing to expand our geographic reach by looking at international opportunities. And then finally, we've had a very strong cash position. It allows us to pay down some debt that I mentioned before. But beyond that, it gives us an opportunity to enable us to look for business development opportunities for the future and look at what other things can we bolt on so we can sell one more product to the U.S. government or have one other product available for first responders.
Those are the things that we continue to look at, and I'll talk about that. But before I do that, let me talk a little bit about what does our pipeline look like because it's important for the future. This is just a quick focus on some of the products I mentioned before. Ebanga for Ebola is one particular product. It's a very concerning threat to the society. Fortunately, it's very rare, but interestingly, it's very predictable. We are seeing an outbreak in Africa of Ebola almost on an annual basis, believe it or not. It just seems to be an outbreak. Since COVID, it's been about one outbreak a year almost in terms of the number of outbreaks we're seeing. Now, fortunately, it's been contained.
It's been contained in Africa, but we're one patient away from getting on an airplane that doesn't know they have the problem and causing an international disaster, so we want to make sure we continue to work on the Ebola product to help us be prepared for any potential downstream problem that could occur both here in the U.S. and in Africa. TEMBEXA, I mentioned as well. It's a therapeutic product for smallpox. We believe that certainly the vaccines are important, but you also need to have therapeutic products for that. It's already approved, so you don't have the regulatory risk of the approval, but we are working on validation and getting additional product available for that.
So much so that we also started a new trial, a MOSA trial, with the opportunity we see with TEMBEXA in Africa to check for the use of it in mpox as a therapeutic. So we're starting some additional clinical trial works there in Africa. And Raxibacumab, I mentioned before also, it's a therapeutic monoclonal antibody for the treatment of anthrax. So a lot of different initiatives in front of us, all things that we think are exciting for the future of our organic growth opportunity. And just to continue my comment about the streamlining of our manufacturing footprint, we just got approval last month, November, I think it was, for the use of manufacturing of our Raxibacumab at our facility in Winnipeg.
Just talking more about how we're going to continue to streamline what we're doing as a company in terms of making sure we have good flexibility in our facilities and keep the operating costs to a minimum. Let me talk a little bit about financials. I think they're important in terms of what we're doing that show the performance of what we've done. As you can see, revenues did come down. This is a third quarter, September 30th, 2025 data that we presented. Third quarter has come down. Part of that is because we made some active decisions to divest some parts of our business that were specifically unprofitable. And as we did that, revenue did come down. So we did shrink. But if you look at what happened to Adjusted EBITDA, both on the margin and also in the total dollars, you can see some very nice results.
Adjusted EBITDA margin went from 19% in 2024- 33% in 2025, predominantly because we've been able to streamline our facility. You can also see improved liquidity year over year by approximately $100 million and operating cash flow also improving. We had some really nice wins in what we're doing on our financials and how we're looking at the future. Earlier this week, we announced that we made a $100 million voluntary term loan paydown. We did that at the end of December. This is just with the intent of reducing our leverage. We've made nice progress in that since 2023. We've paid down $275 million of debt repayment just in the last two years. We're delighted with what's happened. At one point, our net leverage was about 9.9x . I'm delighted to say it's now down to about 2x .
So it gives us a lot more flexibility to think about the future of our business and then, importantly, opportunities for investing in internal R&D as well as the bolt-on opportunities for the future. For 2026, our capital allocations are very straightforward. We're looking at growth investments on where can we invest, as I mentioned before, for things like international growth, internal R&D, and then also the business development. We'll continue to look at debt repayment. We've reduced our net debt to somewhere right around the gross debt is around $600 million, a little less than $600 million. Net debt is down another $200 million. So we've made a nice reduction in that net debt and net leverage right around that 2.0x thereabouts. So we've made really good progress there. And we continue to look to say, what can we do for the future?
As well as beyond that, we've repurchased some of our bonds. And I said we've made a debt paydown. And we're also looking at a share repurchase program because we still believe that that share repurchase program, our share price data does not reflect the value that we think this share price has. So we're going to continue to look at share repurchase. That's a one-year program that runs through March of 2026. As a reminder, I wanted to share with you the full year 2025 revenue and profitability guidance that we presented on October 29th, 2025. These are the guidance range that we showed. And therefore, you can see some of the progression we've made in each of the numbers starting back from March of 2025 through the October date. We'll be presenting our full year numbers on or about the end of February, early March of 2025.
So let me conclude. In summary, we are on track with our turnaround phase of our multi-year plan. We've completed stabilization. We're on track with turnaround. And ultimately, we look to get to transformation. We've reduced our debt just in the last week in December by $100 million. We've increased our gross margin and operating margin for our business by following through on some of the actions we took in 2024 to streamline operations, reduce operating expense. We're continuing to execute on all the key turnaround actions that drive our business forward to strengthen our performance, strengthen what we're looking at. We're going to continue to pursue organic growth, both from the expansion of the international platform and also the new products, and look at inorganic growth opportunities to bolt on some additional growth for the future.
And while we do that, we also have a continuing commitment to the highest standards of patient safety, quality, and compliance across the enterprise. That's what we plan to do. We look forward to, if you have any questions, trying to answer questions, but we're excited about the future and what it means for Emergent and what it means for all the Emergent stakeholders. Thank you for your attention today. Come over to join you.
Great. Thanks for the presentation. And as a reminder for everyone in the room, if you have a question, just raise your hand so someone can bring you a microphone, but I'll go first. So maybe starting with the MCM and commercial segments, what's the best way to think about the revenue trajectory in 2026? And what are the kind of drivers behind each of those franchises?
Sure.
So we're going to be somewhat limited to what we can say about 2026 until we do the guidance, of course. But I would say the following. What we know is that we, in terms of start with MCM, we're in an increasingly dangerous world, and the U.S. government wants to stay with programs for the biodefense side of the business. We expect to continue to make sure that we can provide the solutions that the U.S. government's looking for in the biodefense world. And we have important products that our expectation is there'll be continued demand for them. Just to give you some sense, 2025 was an interesting year with the new administration, but also the government shutdown. Notwithstanding that, we had projected we'd get about six contract modifications during the year from the U.S. government.
In fact, we ended up with about 11 contract modifications, which we think is a good positive indicator about the future interest and our expectation. Some of those are shipped in 2025. Some of them are 2026 delivery. We're excited about what that means for the future. As it would relate to, do you want me to go to the naloxone as well, or do you want to stay on MCM? Your choice.
No, we can go to the naloxone again.
Sure. On naloxone, we think it's continuing to be a problem. We're still seeing too many deaths out there. We take it very serious that we're not going to rest until we can find that number down to zero, essentially. We're looking at all the ways that we can make naloxone, Narcan, our product brand, more available.
And that will include everything that we can with what we're trying to do with making sure it's in first aid kits, making sure it's in homes, because we think that that's availability, that access is what's going to save lives. And so we're going to keep working on that. The data we see suggests that the overall naloxone unit volume is going to grow somewhere in the mid-single digit rate. That's our expectations of how we would expect to see it for the future. We're going to continue to track it and give updates. So we expect that we'll continue to be a leader in the Narcan naloxone market.
We also think having the presence of the Kloxxado, I didn't talk much about it, but that's the high strength, will also give us a chance to continue to have a product offering that makes it easier for our customers. We aren't going to talk specifically about it, but we think there's overall, certainly unit volume growth in the naloxone market for the future.
Okay. And the mid-single digits you talked about for naloxone, that's kind of the overall naloxone market, including competition and your products?
Yes. I want to be very clear. That is the overall market unit volume growth. I'm not really addressing the price, and I'm not really addressing our share, but we do expect to be the leader.
Okay. What do you see as kind of digging into this OTC Narcan specifically, what do you see as the main opportunities and challenges?
For over-the-counter Narcan, what we view as the important opportunity is the more access we can get, the more product we can get, whether it's through the retail stores or through the Amazons of the world, e-commerce of the world. Those are the ways that we just want to get more of it, make it more available. We're working very closely with all the retailers and also with the e-commerce segments of the business to try to get the product out there. It's an area that there's a little bit of concern by individuals that say, "Well, my son or daughter doesn't need that," or "We don't need that." But the reality is you never know when somebody's going to experiment. People shouldn't experiment with drugs, but sometimes they do, and you just never know if something's going to be laced with a fentanyl product.
So we want to make sure that we get rid of any concerns and, in fact, just say, "Let's have it available." You hope your house never starts on fire, but you want to have a fire extinguisher. So we're looking to try to do that type of an approach with consumers and parents, especially, just to make sure that they can help protect their children and/or other friends, family members, etc., to make sure the product's available if you need it. Because with the unfortunate problem of opiate overdoses, once you overdose, you have limited time until you will die. So we got to make sure the product's available, easily available. So those are the things we're working on with all the retailers, with all the e-commerce players to get more product out there on the OTC side. The good news, though, is that we're making progress.
The other thing we see, we think this kit that we just talked about is another way to have that clip onto a backpack, and people will know they have it in case they need it.
And what about in the public interest segment for Narcan? What are the kind of opportunities and challenges there?
Yeah. The public interest segment is the largest segment by far. It's somewhere in the 75%-80% of the totality of the naloxone market. So it is an important segment. We have specific programs with states where we do a couple of things for them. We clearly go out and try to talk to the individual decision-makers on the state about our product, about the Narcan brand, about the trust that consumers have in the Narcan brand because they've heard about it, they know about it.
But beyond that, we also go out and try to help some of the states with the ability to find the funding for the Narcan product. By helping them find the funding, it helps them to get additional product into the state, into the places that need the product. So we're looking to do those things as well in terms of helping them find funding to ensure that product's available. And certainly, we have the distribution capabilities that we have a very automated distribution capability so we can make the product available. We don't see any concerns about our ability to supply for now or the future.
And how do you think about the competitive landscape for naloxone? How do you see that evolving? And what differentiates your products from generics and branded competitors?
Sure. The way we see it, what is Narcan?
Narcan has a brand name, a trusted brand name, one that people know, they've heard about, and we think that's an important part. Narcan, hopefully, is not something you need to buy and replace on a chronic basis. It's something you're buying once to have available in case something happens, so having the trusted brand name, Narcan, we think is important. Not to diminish any of the generic products, but we think having the trusted brand name of Narcan is important. Number two, making sure that we can continue to help find sources of funding for the naloxone or Narcan products. That's something we help them to find that funding. I think I didn't mention it, but there is from opioid litigation settlements by Big Pharma, something along order of magnitude of $50 billion coming to the states over the next 5-10 years.
That's a big part of funding we think that will be available to help make sure that we reduce the overall opioid overdose deaths. So those are things that we're trying to do to help differentiate our product. Of course, we also have distribution capabilities. We shipped about 18,000 different distribution points. We think that helps make it easier to do business with Emergent and Narcan, a specific Narcan direct program that we think is part of the story there to make it easier for the customers that need the product.
Maybe just more specifically on competition, are there any known new branded or generic competitors you see entering the space in the near term?
Yeah. We keep pretty close ties to what's happening there, but I can tell you I don't have complete visibility to that question.
But so far from what we've seen, we haven't seen any new or any suggestion that there's a new player coming. We're certainly managing the current situation. We're not trying to price identical to the generic players. We're trying to be comparatively close to them in the ballpark and then allow the differences and advantages of the Narcan to allow us to hold on to market share. But we're not trying to match pricing. We're just trying to be competitive on pricing.
Okay. Maybe coming back to the MCM business, you highlighted that 34% of MCM orders, I think in the first nine months of 2025, were from outside of the U.S. Yes. Is that sustainable? Or maybe to put it more specifically, can we think of that as kind of the new floor for the mix of international?
Maybe it goes up from there, but it shouldn't dip from there. How do we think about that?
There's always going to be some variation, some seasonality that will occur. We are specifically focusing on the knowledge that this issue that we have, it's an increasingly dangerous world, not just for the U.S., it's for every country in the world. Therefore, we want to make sure that we have products already today. How can we help those other allied governments with the problem? We put together initiatives in 2024 and 2025 that specifically focus on what we can do to differentiate ourselves and have products available, the products are already available. Quite frankly, it makes it a lot easier for those countries to come to Emergent. We've already got the product developed, so we can do it relatively quickly for them.
But these are multi-year initiatives. They don't happen overnight. You work with them, you build a relationship, and you understand what their needs are by country. And we've been doing it now for 25 years. We're going to continue to do it going forward. But they're not going to happen overnight, but we absolutely have a focus on getting more from customers and diversifying business so that we get more from other countries outside of the U.S. So it's good that we believe that we can help those countries, and we stand ready to help them when they need it.
You highlighted how the company's kind of on this turn around plan, seeing margin improvement. What are the levers for potential margin improvement in 2026?
Thanks for the question.
I think we have made significant progress, as Joe noted, on our cost structure, which was a result of really focusing in the product set, focusing in the manufacturing network to get more streamlined, more efficient. We've taken a lot of cost as a result out of G&A as well. So I think that we feel pretty good about the progress we've made. We're not looking for material additional cost reductions at this point, but we are keeping a very disciplined approach to how costs come back into the system as we move forward. And I think really the biggest lever on margin improvement is when you look at the top line. So continuing to look for areas of growth. And as we see revenue increase, I think you'll see that flow disproportionately to margin expansion and the bottom line.
So as you kind of continue the transformation plan, what are kind of the key operational or structural milestones you're hoping to achieve this year to kind of ensure long-term sustainability and shareholder value creation?
Yeah. For us, it comes down to build off what Rich was saying. It comes down to what can we do for growth? The story for 2026 is really all about investing for growth. Where can we make investments for growth that will yield those long-term sustainable, durable growth? That's really what it comes down to. So look to us to have more to say about what we do for, I mean, as simple as the innovation I talked about with having the backpack kit for Narcan, as an example. Look to us to have more innovation on what we do with TEMBEXA and the clinical trial we're doing for Mpox, as an example.
Look to us to talk about what else we're doing with Raxibacumab. What can we do with Ebanga for Ebola? Those are the internal ones. The external portion of what we're doing as well is growing outside the U.S. We'll have more to say about those initiatives as we get contracts for supplying country A with product B. Those are the things that we can look at in terms of the milestone. And then importantly, and I mentioned it briefly, but I want to talk about it again. We think another important opportunity for us is to bolt on one more product that we can ship and sell to either the U.S. government or governments around the world or to the first responders that need products.
Let's add one more product because if we can do that, it makes your P&L very efficient and leverages your P&L in terms of you don't need a lot of incremental operating expense once you have the up-and-running business. We're looking to find another way to add that one more product, as I said, either through our own organic R&D or through business development. I will say that we've had a great chance over the last couple of days at the J.P. Morgan Conference to meet with a lot of different players to talk about opportunities where we can bring our expertise that we have, how to deal with U.S. government and other governments around the world and the regulatory know-how, the scientific know-how we have to help them solve their problems and potentially partner together with a lot of other companies.
So look to us to continue to try to advance that way.
Great. I think that's about it for our time. So we'll stop there. Thank you.
T hank you very much.
Thank you.