A report from MST Marquee Research (MST) predicts the price of CSL's immunoglobulin (IG) will probably rise dramatically in Australia when its current contract with the National Blood Authority (NBA) expires in 2020.
IG is a highly valuable blood product. It is used to treat multiple diseases as well as weakened immune systems.
The imported component of the Australian IG contract was agreed almost four years ago at less than half the US price.
MST says CSL "'has the lions share of the volume" but does share the contract with Grifols.
According to the new MST report, contract prices for IG in countries outside the US have increased by between 18 and 40 per cent in the past year, having been chronically low for more a decade.
The increase has been driven by rising global demand and the push in the US for greater scrutiny of international prices - Australia is unlikely to be immune from pressure to close the price gap, says MST.
Over 15 per cent of IG volume globally is distributed to lower-priced markets like Australia, France and Germany.
It says Australia, through the NBA, is likely to face a more than 60 per cent jump in the price of the imported component of IG under its next contract.
The use of IG Australia is governed by the 'Criteria for the clinical use of immunoglobulin in Australia' that were developed by the NBA alongside clinicians to identify the medical conditions and circumstances for which IG is funded.
MST rates CSL a 'buy' and predicts the company's share price could rise by more than 10 per cent over the next 12 months.
Dr Amanda Ruth (amanda@dailydispatch.com.au)