CSL Moves Up International Biotech Market Capitalisation Rankings Driven By R&D Investment

January 20th, 2020 blood cells

A report in the Australian Financial Review has highlighted the remarkable performance of CSL over recent years, largely due to the company’s investment in R&D Activity.
The report has highlighted:
  • CSL’s share price has increased more than 50% during 2019, which is rare for a company of such size and maturity;
  • If CSL maintains their current trajectory, it may shortly overtake Commonwealth Bank of Australia as the 2nd most valuable stock on the ASX by market capitalisation;
  • CSL is now ranked as the third most valuable biotech internationally by market capitalisation (behind only Amgen and Novo Nordisk) and has overtaken companies such as Biogen and Allegan;
  • CSL spends around 10% of sales on R&D Activity investment, and the current year R&D budget is $1.4B. This includes R&D activity in both Australia and internationally.
CSL has also been vocal in urging the government to maintain stable R&D Tax Incentives as a means of giving business confidence to invest in long-term Australian R&D projects, rather than utilising overseas R&D Facilities. Given CSL’s international success, their tax policy views should be held in high regard as the Australian Parliament considers the government’s proposed reforms to the R&D Tax Incentive in the coming months. Proposed reforms include significant changes such as the “Intensity Threshold,” which has been widely criticised as overly complex and reducing the incentive to conduct R&D Activity.
Source: Australian Financial Review

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