CSL

Here is an update on the different sectors of Australian market from market analyst Macquarie Research Equities.

Record Oil - The Impact of Black Gold

CSL (CSL) has a target price of $42.00 from Australian Stockmarket analyst Macquarie Research Equities.

CSL (CSL)Caution on timing of Cervarix US Approval & we update for FX impact

Delays to Cervarix US approval could be protracted:

Overnight, UBS analysts acknowledged that a 2010 USA launch for GlaxoSmithKline’s cervical cancer vaccine "Cervarix" is at risk. UBSe had previously assumed a 2010 launch, a view "more bearish than consensus" which expected US FDA approval in CY09.

Gardasil monopoly till 2010 a boost to royalties payable to CSL:

CSL has a maintained 12 month stock price target of $36.95 from Australian sharemarket analyst Macquarie Research Equities.

CSL: A Healthy Alternative

CSL has a neutral stock recommendation and a share price target of $36.52 from Australian stockmarket analyst Macquarie Research Equities.

CSL: Trading Idea

Baxter International Incorporated (BAX.US), supplier of medical products, reported their quarterly results which were a positive result from CSL’s perspective. Macquarie Research (MRE) maintains their neutral recommendation for CSL stock with a 12 month price target of $36.52. CSL stock traded up 0.8% this morning to $38.12.

CSL – Neutral
Current Price: $38.02
Target Price: $36.52
P/E: 30 X

CSL has an unchanged Buy stock recommendation and a share price target of $108.70 from Australian stock analyst UBS. They rate the US IVIG supply as 'marginally adequate'; but short globally: Their FY07 survey coincides with wide ranging global industry meetings which indicate better IVIG availability in the US market relative to the past 12-24mths; industry data suggests distribution 2HFY07 is up 3.7% on pcp. But, supply has not yet returned to 'adequate' levels - measured as 5 weeks supply; any 'hiccup' still spells shortages. Globally, EU remains short & ROW is sporadic at best. US IVIG prices expected to grow c.5% over next 12mths: The analysts' Sep-07 qtr pricing survey shows c.2% US IVIG price gains on consecutive quarters, but up c.10% on pcp for weighted average pricing. CSL has booked the fastest growth, up c.6% on consecutive qtrs to US$52/g; but off the lowest base. Some concentrations of Albumin remains in tight supply & price gains: Albumin at $32/vial (or $2.56/g) is up 14% on pcp; industry expects this to reach c.US$40/vial over the next 12-24mths. Awareness of the SAFE study is very low. Supply gains are consistent with UBSe which show some convergence with demand; they expect a comprehensive supply/demand model will be more critical to sector outlook going forward. There is risk of 'lumpiness' in the market as existing US collection centres gain final approval. But globally, with demand growth put at 7-10%, we continue to rate demand ahead of supply out to end CY10. Their price target is based on FY09 NAV estimate and a DCF analysis of future growth. Read previous CSL shares recommendations.

CSL shares have fallen over 4 percent this morning following rumours, circulated via a public interest website, that the Gardasil vaccine (for which CSL receives a net ~6% royalty) has caused three deaths, as part of 1,637 adverse reactions so far reported to the FDA. This is clearly gaining traction in the market with the stock down ~8% over the last two days. The recent press surrounding minor patient reactions to Gardasil vaccinations in Australia would appear to have compounded the current noise. Stockmarket analysts Macquarie Research Equities are yet to fully confirm the veracity of the claims of the 'Judicial Watch' website. Even assuming the assertions are factually correct, it is important to put the claims into context. 1,637 reactions (mostly minor reactions) is relatively insignificant when considered against the ~1.6m Gardasil inoculations performed so far in the US. According to the site, 342 or the reactions, recorded via the Vaccine Adverse Event Reporting System (VAERS), were considered serious. Of the three deaths apparently reported, the details of one is vague, the other two are recorded as occurring 6 and 14 days post vaccination (one of the deaths reported received a number of different vaccines on the same date). The causes of the latter two apparently relate to the cardiovascular system but the causes of death were essentially different. The analysts consider it unlikely that the FDA has considered the linkage of death and/or serious adverse reactions as specific to the Gardasil vaccine, as it would surely have acted (the 'public interest' website seems to suggest that the FDA panders to Pharma industry profitability). Further, the analysts also find it unlikely that this would have escaped the attention of the financial markets with respect to Merck whose recent earnings outperformance is materially due to Gardasil. As for the reactions in Australia, pre-pubescent children often have minor reactions to vaccine inoculation, particularly psychologically-driven reactions. Minor physical reactions are generally related to the type of vaccine adjuvant used, and the vaccine adjuvant used for Gardasil (Aluminium-based) the most common type of adjuvant used in modern vaccines. At this stage HPV represents 8.7% of MRE’s CSL valuation. The analysts retain their Outperform recommendation

Citi Investment Research have provided an update to CSL's operations: A US study at the Johns Hopkins University in Baltimore and published in the New England Journal of Medicine (NEJM) has shown people with prior HPV-16 infection were 32 times more likely to develop throat cancer, a much higher risk than that attributed to smoking or heavy alcohol intake. People with six or more lifetime oral sex partners were more at risk, with eight times the increased risk of developing oropharyngeal cancer, induced by HPV genomic instability. Professor Ian Frazer, who co-developed the Gardasil vaccine, stated that the evidence was "compelling" in linking HPV as a major factor in the development of oropharyngeal cancer. The research is indicating that oral HPV is sexually acquired, and that the cancer has risen in the USA since 1973. Head and throat cancers are responsible for an estimated 10% of all cancers. If HPV-16 is implicated in 26% of them, it substantially strengthens the case to vaccinate male as well as female populations. To date, this is only occurring in Austria. Value of Gardasil vaccine could double If governments worldwide decided on the basis of this research to extend the funding of the vaccine to males as well as to females, then this would double our current valuation of the vaccine to $11.40 a share.