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#H1 FY2021 Results
Added 2 weeks ago

18-Feb-2021:  Half Year Results Announcement   plus   Half Year Results Investor Presentation

and:   Statutory Accounts for the Half Year Ended 31 Dec 2020

CSL Delivers a Strong Half Year Result of $1.8 Billion* Net Profit

  • CSL delivered a strong first half result for 2021 with reported net profit after tax of $1,810 million, up 44% at CC** reflecting:
    • Solid growth in our core immunoglobulin portfolio led by HIZENTRA®
    • Successful transition to own distribution model in China
    • Strong growth in the leading HAE product HAEGARDA®
    • Exceptionally strong performance by Seqirus
    • CSL’s diversified portfolio and resilient business model in the midst of COVID-19 pandemic
    • Full financial recognition of contracted income for UQ COVID-19 vaccine in first half, after program termination
  • Earnings per share $3.98, up 44% at CC**
  • Interim dividend*** of US$1.04 per share, up 9%
    • Converted to Australian currency, the interim dividend is approximately A$1.34 per share down 9%
  • FY21 net profit after tax is anticipated to be in the range of approximately $2,170 million to $2,265 million at constant currency

Notes:

  1. (*) All figures are expressed in US dollars unless otherwise stated.
  2. (**) Constant currency (CC) removes the impact of exchange rate movements, facilitating comparability of operational performance. For further detail please refer to CSL’s Financial Statements for the Half Year ended December 2020 (Directors’ Report).
  3. (***) For shareholders with an Australian registered address, the interim dividend of US$1.04 per share (approximately A$1.34) will be unfranked for Australian tax purposes and paid on 1 April 2021. For shareholders with a New Zealand registered address, the interim dividend of US$1.04 per share (approximately NZ$1.44) will be paid on 1 April 2021. The exchange rates will be fixed at the record date of 5 March 2021. All other shareholders will be paid in US$. CSL also offers shareholders the opportunity to receive dividend payments in US$ by direct credit to a US bank account.

--- click on links above for more ---   [I hold CSL shares and believe they are one of the, if not THE highest quality company on the ASX.]

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#Bull Case
Last edited 2 weeks ago

Quick Update:

The Therapeutic Goods Administration has given a second coronavirus vaccine the green light, as Australians anxiously await the rollout of the vaccination program.

The medical regulator announced today it had granted provisional approval to AstraZeneca Pty Ltd for its COVID-19 vaccine, making it the second COVID-19 vaccine to receive regulatory approval in Australia after approving the Pfizer vaccine in January.

It means the jab is provisionally approved and included in the Australian Register of Therapeutic Goods for the immunisation of individuals 18 years and over, with the vaccination of those aged over 65 should be decided on a case-by-case basis.

The exciting news broke during Victoria’s daily COVID-19 press conference, and chief health officer Brett Sutton said it was “terrific news”.

(https://www.news.com.au/world/coronavirus/health/astrazeneca-coronavirus-vaccine-provisionally-approved-by-tga/news-story/6189ce007611de11779b198b4253505a)

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According to my research:

Pfiser/Moderna vaccines are $30/2 jabs; AstroZeneca is $5/2 jabs

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Yesterday, CSL has announced the final stages of manufacturing of the AstraZeneca COVID-19 vaccine for Australia will commence from today. The first doses of the vaccine are on track for release towards the end of March, subject to approval by the Therapeutic Goods Administration (TGA).

(Source: Linkedin)

Earlier last week, the vaccine was approved by the Office of the Gene Technology Regulator. It's currently under review at the Therapeutics Good Administration.

"The AstraZeneca vaccine is what's known as a biological. It needs the help of living organisms to be produced.

Loads of pharmaceuticals are produced this way, including vaccines. The HPV vaccine, for instance, which protects against cervical cancer, is one.

The AstraZeneca COVID-19 vaccine relies on a type of cell called HEK 293. These cells were originally taken from a human embryo kidney — hence HEK — back in the 1970s. They grow well in labs and are a commonly used component in drug manufacturing.

HEK cells don't actually end up in the vaccine. Instead, they cultivate the crucial part of the vaccine — the adenovirus, which carries the spike protein DNA blueprint.

So the first step in making the AstraZeneca vaccine is to grow an army of HEK cells.

Just as you might get sourdough starter from a friend, AstraZeneca, in November, supplied CSL with tiny frozen tubes, each holding a mere millilitre of HEK cells.

CSL's job was to take these smidgens and get them multiplying to fill the equivalent of a small water tank."

(Source: https://www.abc.net.au/news/science/2021-02-12/covid-19-vaccine-oxford-astrazeneca-adenovirus-csl-manufacturing/13140104?utm_medium=content_shared&utm_source=abc_news_amp&utm_campaign=abc_news_amp&utm_content=mail)

 

Disclaimer: I hold CSL shares

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#Moats
Added 3 weeks ago

Why does CSL have a competitive advantage?

  • They create products essential to the healthcare sector. Products are vaccines and therapies. 
    • No matter what happens around the world, there will always be demand for their products. Highly Inelastic demand curve from a long term perspective. 
  • They can manufacture new products using cash from the balance sheet. They spend $1B in R&D and generate positive operating cash flows and net profit. Other companies have to raise cash from investors to fund their R&D. 
  • They have long term relationships with government stakeholders and is classified as an "essential" business to the Australian economy. In other words, they cannot die as the government needs CSL. 
    • When the pandemic hit, CSL took on the responsibility of manufacturing the new vaccine. CSL will obtain revenues in perpetuity for manufacturing the vaccine. 
  • CSL think in decades, they have a 2030 plan
    • Prospect of building Seqirus into the second-largest influenza vaccine innovator in the world. 
    • Entering new markets like Cell and Gene Therapy through the acquisition of Calimmune. 
    • To put it in their words 
      • "We see potential in the years ahead to create enhanced value and to better serve our patients through the use of data, connectivity and technologies that can improve our operations and increase our understanding of the patient experience. Today, we are taking the necessary steps to enable digital transformation throughout the business." 
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#Bull Case
Added 2 months ago

An interesting article in today's The Age:

" Biotechnology giant CSL says it may review its capacity to make an alternative coronavirus vaccine made by US firm Novavax in Australia but has emphasised all of its resources are currently tied up in making the AstraZeneca product.

...

The focus on new supply deals prompted reports including in The Daily Telegraph that Melbourne-based CSL might be able to locally manufacture the protein vaccine designed by US biotechnology company Novavax.

The $123 billion blood plasma products maker has said at this stage it has focused all of its resources on making the AstraZeneca vaccine onshore, though it would re-evaluate its manufacturing capabilities if the government requested this once the production of the 50 million AstraZeneca vaccine doses was complete. Given current timelines, this might not be until the end of 2021."

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#ASX Announcements
Added 3 months ago

Update on The University of Queensland COVID-19 vaccine


The University of Queensland (UQ) and CSL (ASX:CSL; USOTC:CSLLY) today announce that the Phase 1 trial of the UQ-CSL v451 COVID-19 vaccine has shown that it elicits a robust response towards the virus and has a strong safety profile. There were no serious adverse events or safety concerns reported in the 216 trial participants. However, following agreement with the Australian Government, CSL will not progress the vaccine candidate to Phase 2/3 clinical trials.


The University of Queensland commenced a Phase 1 trial of their COVID-19 vaccine candidate – v451 – in July 2020, to assess safety and immunogenicity in healthy volunteers. CSL was working towards taking responsibility for the Phase 2/3 clinical trial and large-scale manufacture of the vaccine, upon completion of successful trials.


The Phase 1 data showed the generation of antibodies directed towards the “molecular clamp” component of the vaccine. These antibodies interfere with certain HIV diagnostic assays. The potential for this cross-reaction had been anticipated prior to the commencement of the trial. Participants were fully informed prior to their involvement that this could occur. Blood samples from study participants were tested after vaccination and it was found that these molecular clamp antibodies did cause a false positive on a range of HIV assays. Follow up tests confirmed that there is no HIV virus present, just a false positive on certain HIV tests. There is no possibility the vaccine causes infection.


With advice from experts, CSL and UQ have worked through the implications that this issue presents to rolling out the vaccine into broad populations. It is generally agreed that significant changes would need to be made to well-established HIV testing procedures in the healthcare setting to accommodate rollout of this vaccine. Therefore, CSL and the Australian Government have agreed vaccine development will not proceed to Phase 2/3 trials.

The Phase 1 trial will continue, where further analysis of the data will show how long the antibodies persist, with studies so far showing that levels are already falling. The University of Queensland plan to submit the full data for peer review publication in the future.


UQ Vice-Chancellor, Professor Deborah Terry, said while the outcome was disappointing, she was immensely proud of the UQ team who had shouldered a heavy burden of responsibility while the world watched on. “I also want to thank our many partners, our donors – including the Federal and Queensland Government – and of course the 216 Queenslanders who so willingly volunteered for the Phase 1 trials.”


UQ vaccine co-lead, Professor Paul Young, said that although it was possible to re-engineer the vaccine, the team did not have the luxury of time needed. “Doing so would set back development by another 12 or so months, and while this is tough decision to take, the urgent need for a vaccine has to be everyone’s priority.”


“I said at the start of vaccine development, that there are no guarantees, but what is really encouraging is that the core technology approach we used has passed the major clinical test. It is a safe and well-tolerated vaccine, producing the strong virus neutralising effect that we were hoping to see. So we will continue to push forward and we are confident that with further work the Molecular Clamp technology will be a robust platform for future vaccine development here in Australia and to meet future biosecurity needs.


Dr Andrew Nash, Chief Scientific Officer for CSL said “This outcome highlights the risk of failure associated with early vaccine development, and the rigorous assessment involved in making decisions as to what discoveries advance.”


“This project has only been made possible by the innovative science developed by world-class scientists at The University of Queensland and the strong collaboration between our organisations, and many others, over the last 10 months. CSL and Seqirus are committed to continuing our work to protect the Australian population against COVID-19. Manufacture of approximately 30 million doses of the Oxford/AstraZeneca vaccine candidate is underway, with first doses planned for release to Australia early next year. In addition, CSL has agreed at the request of the Australian Government to manufacture an additional 20 million doses.”


CSL does not anticipate this announcement will have any impact on previously provided financial guidance for FY2021.

View Attachment

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#ASX Announcements
Added 4 months ago

Next-generation influenza vaccine manufacturing facility to be built in Australia

AUD$800m investment optimises cell-based technology

Global biotechnology leader CSL Limited (ASX:CSL; USOTC:CSLLY) today announced that Seqirus, a wholly owned subsidiary of CSL, plans to invest more than AUD$800 million in the construction of a new biotech manufacturing facility in Melbourne to supply influenza vaccines to Australia and the rest of the world.

This investment decision follows the agreement with the Australian Government for the supply over 10 years of influenza pandemic protection for the Australian population, antivenoms for Australian snakes, spiders and marine creatures and Q-Fever vaccine.

The new facility, to be built at a site in the Melbourne Airport Business Park, will use innovative cell-based technology to produce influenza vaccine for both seasonal and pandemic purposes. These products will serve the needs of the Australian population and have capacity to support global markets. Construction of the state-of-the-art plant is expected to commence in 2021 with the facility projected to be operational by mid-2026.

The facility will also manufacture Seqirus’ proprietary adjuvant MF59® - a substance added to some vaccines to improve immune response and to reduce the amount of antigen needed for each vaccine, enabling more doses to be manufactured more rapidly.

CSL’s Chief Executive Officer and Managing Director Paul Perreault said, “Providing safe and effective influenza vaccines is essential in securing our defences against serious public health threats.”

“The facility will be an important addition to our global influenza manufacturing supply chain, incorporating the technology platform used in our Holly Springs, North Carolina facility. Cell-influenza vaccine technology offers many advantages over the existing process including being more scalable and offering faster production – particularly important in the case of influenza pandemics.

“As a proudly Australian company, we are pleased to make this investment in worldclass advanced manufacturing. This decision will ensure the future of 1,000+ Science Technology Engineering & Manufacturing jobs in Victoria and a supply chain of more than $300 million annually,” he said.

The Victorian Government will also contribute to the project to reinforce Victoria’s already globally significant medical research and biotechnology community.

View Attachment

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#Chairman's AGM Address
Added 5 months ago

14-Oct-2020:  Chairman's Address to Shareholders

CSL LIMITED 2020 ANNUAL GENERAL MEETING SPEECHES

Please find attached addresses to shareholders to be delivered by the Chair and the Chief Executive Officer at CSL Limited’s Annual General Meeting today.

Shareholder attention is drawn to a revised FY21 outlook, details of which are provided in slide 9 of the attached presentation.

Net profit after tax is now expected to be approximately $2.170 to $2.265 billion at constant currency, implying a growth of 3 to 8%, which is a slight tightening of the range advised at the Company’s results announcement in August. The low end of the range was previously zero, which has now been raised to 3%.

The meeting will be webcast at https://web.lumiagm.com/?fromUrl=362222588

--- click on link above for the AGM addresses by the CSL Chairman and CEO plus the revised FY21 outlook statements on slide 9 ---

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#UQ Vaccine Agreement
Added 5 months ago

08-Oct-2020:  CSL Supply Agreement for UQ Vaccine with Commonwealth

CSL finalises agreement to supply 51 million doses of UQ COVID-19 vaccine candidate to Australia

CSL Limited (ASX:CSL; USOTC:CSLLY) today announces that its subsidiary, Seqirus, has signed a final agreement (Agreement) with the Commonwealth of Australia for the supply of 51 million doses of the University of Queensland-CSL COVID-19 vaccine candidate (V451), should clinical trials be successful. This follows the Company’s announcement of 7 September 2020 advising that a binding Heads of Agreement had been entered into with the Australian Government.

The Agreement includes an up-front financial commitment from the Government to support the clinical and technical development activities that CSL will need to assume in order to progress V451, and, if clinical trials are successful, also secures access to onshore production and supply of the vaccine for Australia.

CSL has been working at pace to respond to the current COVID-19 pandemic and has invested significant resources in the rapid development and large-scale manufacture of V451, along with a number of other therapeutic programs. The Company previously advised the ASX of additional agreements entered into with the Australian Government and with AstraZeneca to produce approximately 30 million doses of the Oxford University/AstraZeneca vaccine candidate, AZD1222. The two vaccines work through different approaches, but can leverage many facets of the same manufacturing platform technology used by CSL to produce recombinant proteins.

The large-scale Phase 2b/3 clinical study for V451 is almost ready. It will be a randomised, observer-blinded, placebo-controlled study across numerous countries and >100 sites. The study will evaluate efficacy, immunogenicity and safety in adults aged 18 years and above.

Subject to progress in the current Phase 1 study, the first subject for the Phase 2b/3 would be enrolled in December 2020, with the goal completing recruitment by March 2021. We are committed to demonstrating the vaccine is safe and effective prior to availability in the market. Discussions have already commenced with the Australian Therapeutic Goods Administration (TGA) to ensure this goal is met, while also making the vaccine available to the Australian population in the shortest possible time.

In parallel, CSL is working to engage partner organisations to assist with production of further doses with the goal of providing broader access to the vaccine, should clinical trials be successful. The Company also continues to work with the Coalition for Epidemic Preparedness Innovations (CEPI) to fulfil our shared commitment to the program, which includes support for the COVAX Facility, a mechanism established by CEPI, the Global Alliance for Vaccines & Immunizations (Gavi) and the World Health Organisation (WHO) to rapidly accelerate the development, production and delivery of COVID-19 vaccines to support equitable access.

Given the considerable risk, effort, cost and uncertainty associated with the development of these novel vaccines, it is too early to calculate with any certainty the financial impact to the Company.

--- ends ---

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#ASX Announcements
Added 6 months ago

CSL to manufacture and supply University of Queensland and Oxford University vaccine candidates for Australia

  • Heads of Agreement signed between CSL and the Australian Government to supply 51 million doses of University of Queensland vaccine to Australia, with first doses scheduled for release from mid-2021 following successful clinical trials.
  • Heads of Agreement signed between CSL and AstraZeneca for the expected manufacture of approximately 30 million doses of the Oxford University vaccine candidate AZD1222, for supply to Australia with first doses scheduled for release early 2021, following successful clinical trials. 
  • Funding Deed with the Australian Government and CSL to ready its facilities for the manufacture of the AZD1222 vaccine candidate, and provide an additional COVID-19 vaccine option for Australians

View Attachment

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#M&A
Added 8 months ago

25-June-2020:  CSL to acquire LateStage Gene Therapy Candidate from uniQure

CSL is the best quality company on the ASX and has been for a very long time.  They will keep growing - both organically and via acquisitions (like this one).

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#ASX Announcements
Added 10 months ago

07-May-2020:  New Debt Facilities to Strengthen Maturity Profile

Also (last month):  09-Apr-2020:  Company Update on COVID-19   and   08-Apr-2020:  Company Update on COVID-19

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#Media/Analyst Views:
Last edited one year ago

11 August 2019:  https://www.livewiremarkets.com/wires/csl-how-good-is-this-story

Rudi Filapek-Vandyck from FNArena on Australia's best listed company this afternoon.

Disclosure:  I hold CSL in my SMSF.

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