Australian biotech giant CSL to spin off vaccine unit Seqirus, cut 15% of workforce

[SYDNEY] Australian biotech giant CSL said that it will spin off its Seqirus vaccine business into a separately listed company as part of a restructure that will see it reduce its workforce by as much as 15 per cent and cut costs by around US$500 million a year.

CSL Seqirus, which makes seasonal influenza vaccines, contributed US$2.2 billion of the firm’s total revenue of US$15.6 billion in the 12 months ended Jun 30, the Melbourne-based company said on Tuesday (Aug 19). Net profit rose 17 per cent to US$3 billion, just above analyst estimates of US$2.97 billion.

Seqirus will list on the Australian securities exchange by the end of this fiscal year. The spinoff will give Seqirus, which will be chaired by Gordon Naylor, “autonomy to set an independent strategic direction, including capitalising on potential opportunities that may arise in a highly dynamic vaccines market, as well as reducing complexity, making the business more agile and efficient to manage”, CSL said.

CSL also closed 22 underperforming US plasma centres this month, and will consolidate its research and development from 11 sites into six. The restructure will unlock US$500 million in annual savings by the end of fiscal 2028, though CSL will incur one-off restructuring costs of US$700 million to US$770 million.

While CSL employs around 32,000 people, no firm number was put on the job cuts.

Further details on the Seqirus spinoff will be given at CSL’s capital markets day on Nov 4 to 6 in the US.

CSL also plans to buy back A$750 million (S$626 million) of shares this financial year, the first step in a multi-year buyback. BLOOMBERG