The US supplies the majority of the world’s plasma and donors are paid for their blood, with payments usually starting at around $US50 ($90) per collection. The majority of plasma sourced by CSL comes from the US.
The concerns raised by Australian Ethical come in the wake of a research note from Credit Suisse last week that warned CSL would have to closely manage the health and welfare of donors, suggesting the collections sector was in for increased scrutiny over how it treats donors.
“The principal risk is reputational. That is to say that CSL [would be] potentially mired in accusations of exploitation,” the note said.
It also warned that the sector’s reliance on donors from low-socioeconomic backgrounds was attracting attention and that CSL’s planned new donation centres “have an even higher propensity than the industry average to be located in regions where the local population are more economically vulnerable to exploitation.”
CSL chief medical officer Dr Charmaine Gittleson said there were no ethical or health concerns associated with blood plasma donation, saying it was in CSL’s best interests to ensure the ongoing health of donors and there were no large long-term studies linking health risks to frequent donations.
“We have 48 million donations happening each year and every plasma centre is monitoring them for safety. All of that information gets collected and put into formal systems. Regulators are able to look at data across the years and are able to track the safety of donations,” she said.
“And we have not seen any significant regulatory changes to how [plasma] is collected.”
Australian Ethical’s Palmer said the Credit Suisse report had raised pertinent issues for CSL to address.
“The research does raise important industry concerns about the frequency of permitted donations, how much donors are paid and companies’ responsibility for understanding health impacts on regular donors and having appropriate processes in place to prevent risky donations.”
“Payment levels should take account of the value and profitability of the plasma products being created. These are issues we intend to discuss further with CSL.”
Valued at $139 billion, CSL is one of the most valuable companies on the ASX, largely because of growth in its blood plasma therapy business. It collects plasma, the yellow liquid in blood which carries cells and proteins, and turns it into life saving therapies.
CSL has been updating investors on the rollout of new centres over the past year to cater for global growing demand for plasma products. One industry expert said those sites were likely chosen where zoning regulations were favourable and there was good access to public transport.
In response to concerns raised in the Credit Suisse report, CSL said plasma donors understood and appreciated their role in delivering life-altering therapies and that ethics and regulatory safety were the company’s number one focus.
CSL is a member of industry groups including the Plasma Protein Therapeutics Association, which is currently undertaking a longitudinal study of donor health.
“The consequence of incomplete or inaccurate reporting on this subject can risk the health of many around the world who live with rare, serious and life-threatening conditions.”
The Credit Suisse report also raised the spectre of new regulations around how migrant donors contribute plasma, which could limit or make it more expensive for donors to cross the border from Mexico to come to centres operated by CSL’s. Credit Suisse believes the company has a 5 per cent exposure to Mexican donors.
One industry expert said CSL would be in the box seat if the sector faced tighter regulation, because its governance practices were already best in class.
Unlike other players in the US market, CSL has more consistent internal systems for collection and donor monitoring and would be ready to move faster than competitors to roll out new requirements, they said.
Australian equities analysts have questioned whether the company can collect enough plasma in the coming months to offset slowdowns caused by coronavirus shutdowns.
Citi and JP Morgan have both said that because there is a delay between the collection and sale of plasma products, the true impact of pandemic shutdowns on CSL are not yet known.
On an investor call to discuss COVID-19 earlier this month, management were asked how they were encouraging donations and whether they anticipated the price they pay to donors would go up or down given rising unemployment.
CSL chief executive Paul Perreault said the company was “pulling all levers” to encourage donations, though it was impossible to predict whether the amount on offer to donors would change.
“I don’t know, I can’t tell you. It all depends on what happens,” he said.
Emma is the small business reporter for The Age and Sydney Morning Herald based in Melbourne.