CSL sees greying population as saviour in Ozempic battle

But the shine has worn off lately, with margins in blood collection centres under pressure and rivals planning to launch generic drugs against its iron deficiency product, Ferinject.

Another blow came last week when Novo Nordisk halted a study early because the effectiveness of Ozempic in treating kidney disease was immediately apparent, raising questions about the number of patients for CSL products.

“We think this could be a potential negative catalyst on CSL. CSL Vifor has a joint venture with Fresenius Medical Care, with 45 per cent of Vifor revenue exposed to nephrology (kidney conditions) and dialysis (8 per cent of CSL’s group earnings),” Morgan Stanley analysts wrote.

CSL head of research and development Bill Mezzanotte maintained the patients in the trial only represented a “small percentage of the overall dialysis patient population, which of course is only a small percentage of the business”.

“Therefore, despite the positive results, the trial outcome is only likely to have a small impact on the dialysis business,” he said.

The market has also questioned Ozempic’s impact on one of CSL’s proposed drugs, CSL112, for treating some patients who have a high risk of recurrent cardiovascular problems, including heart attacks. Results of final phase III round trials on CSL112 are due this financial year.

Dr Mezzanotte said Ozempic, originally a diabetes drug, might reduce heart attacks in the people CSL aimed to treat.

“However, offset by that, GLP-1s will do nothing for ageing,” he said. “And the overall population remains to continue to age, and that will likely balance the effect and keep the number of [heart attacks] in total, relatively constant.”

He further maintained that other medications, such as SGLT inhibitors, had historically come to market with high hopes of moderating kidney or cardiovascular ailments.

“None of these have done it, and not because they’re not effective therapies, but because it’s such a multidimensional complex issue of cardiovascular and renal disease,” he said.

CSL stuck with guidance of revenue growth this financial year of 9 per cent to 11 per cent at a constant currency basis, and underlying profit to lift between 13 per cent and 17 per cent, implying a range of $US2.9 billion ($4.6 billion) to $US3 billion.

It is illegal to pay for blood plasma in Australia, but CSL can pay donors in the US, where it has 322 collection centres. Attendance dropped off in the pandemic under lockdown orders, denting returns.

CSL highlighted plans to improve cost efficiency, including a system to balance donor arrivals with labour, potentially by offering different fees if people come at peak hours, such as midday, as opposed to 2pm.

“So no different than Uber Eats or Uber,” Mr McKenzie said. “At the busiest time will probably get a little less of a donation fee. And then a less [busy] time, come on in and maybe we’ll give you a little bit more there.”

CSL is also considering the quality of plasma. “We can start making sure the donors coming in are getting fairly compensated for what they’re contributing, including protein levels and other things because we track all that,” he said.