The CSL Limited (ASX: CSL) share price cracked the $300 threshold for only the third time in 2022 this morning. The ASX healthcare share is up 1.53% at $301.38 in early morning trading.
There is no news out from the health giant itself today.
However, according to the Australian Financial Review (AFR), broker Wilsons has just issued a note to clients reporting that CSL's Hemgenix drug has been approved in the United States.
This is a world first, with the drug being the first and only one-time gene therapy for adults with haemophilia B to go to market.
Wilsons says it will "expand and fortify CSL's leadership position in Haemophilia B, already established with Idelvion".
Wilsons anticipates a commercial launch in FY24.
Image source: Getty Images
World-first drug approval for haemophilia B
According to The Australian, CSL CEO Paul Perreault says the United States Food and Drug Administration's decision is a "historic approval".
Perreault says:
CSL is committed to delivering innovative and groundbreaking solutions to address unmet medical needs, and we are proud to introduce the next wave of breakthrough medicines for people living with haemophilia B.
What's next for the CSL share price?
CSL became a $300-plus stock for the first time in January 2020. It rose as high as about $340 before the COVID-19 crash brought it down into the $270 range.
Since then, it has risen above $300 on a number of occasions but hasn't been able to hold above that threshold for any significant length of time.
But both Wilsons and Citi think it can over the next 12 months.
Top brokers say CSL share price will go well beyond $300 in 2023
As my colleague James reported on Monday, top broker Citi has reaffirmed its expectations that the CSL share price will reach $340 by about this time last year.
In a new note, the broker has retained its buy rating on CSL shares.
Citi likes CSL's commitment to research and development. On 3 November, CSL held an investor briefing regarding its R&D activities.
Citi highlights that CSL plans to continue spending more than US$1 billion on R&D for the foreseeable future.
CSL spent US$1.156 billion in FY22, which was about 11% of the company's revenue.
Citi commented:
CSL will continue to spend ~10-11% of revenue on R&D annually. The pipeline now includes assets from recently acquired Vifor with two assets in Phase 3.
Our $340 TP includes $22.40 for the R&D portfolio (down from $23 on delays) – the main asset remains CSL112 (cardiovascular) at $20/share on which we will get Phase 3 data in Q1 CY24. Maintain Buy, $340 TP.
Wilsons is valuing CSL's drug development pipeline at $62 per share. It values its core business at $265 per share.
So, all up, Wilsons is tipping a 12-month share price target of $327 for CSL and has an overweight rating.
Wilsons said in its client note:
The potential to replace ≥10 years of regular prophylactic management for these patients with a single shot of Hemgenix is a powerful driver of sector dominance, which brings with it margin expansion and sales leverage opportunities within the CSL Behring recombinant haemophilia (rHaem) portfolio.
Wilsons forecasts a 12.3% bump to earnings per share (EPS) in FY23 and a net profit of $US2.5 billion.
The European Medicines Agency is also reviewing the Hemgenix drug for approval.
