OPINION: Margins in CSL’s key plasma business are under pressure, but new CEO Paul McKenzie plans to fix the issue by thinking like a retailer, as well as a scientist.
Five months after becoming chief executive of CSL, Paul McKenzie has finally made one of the most important decisions facing the boss of a Melbourne-headquartered company.The Saints beat the Richmond Tigers handily on Sunday, which meant McKenzie could send his old boss and Tigers fan Paul Perreault a friendly text. Of course,
Plasma collection was badly disrupted by the pandemic and, although CSL has been able to get collection rates back above record levels, this has come at a cost. Higher fees for blood donors and labour costs have pushed down Behring’s gross margins of 57.1 per cent before the pandemic in 2019 to just 49.2 per cent for the 2023 financial year, just below analyst expectations.
“We continue to see Ig growing at high single digits [or] low double digits, so that’s a balance – I could lower the CPL drastically, but then not collect enough litres to fuel the needs of patients,” McKenzie says.Instead, McKenzie aims to restore Behring’s margins over the medium term – think the 2026 financial year – by working both ends of the plasma value chain: collections and manufacturing.
At Behring’s manufacturing plants, there’s a raft of small tweaks to existing processes in the near term that are designed to improve yields. Over the next five to seven years, McKenzie is planning to introduce new technology in the isolation stage of the manufacturing process to drive yields higher.
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