Australian Drugmaker CSL Strikes Deal to Cut US Prices
Synopsis
Australian biotech company CSL has struck a deal with the Trump administration to lower medicine prices in America while expanding its US manufacturing footprint with a US$1.5 billion investment.
Melbourne-based biotech CSL will cut prices on drugs supplied to US Medicaid, after signing a deal with the Trump administration.
The deal was announced Aug 31 and is part of the US government's most-favoured-nation pricing program. Under the arrangement, state Medicaid programs will be able to access CSL medicines at prices linked to the lowest prices paid in other developed countries.
The White House said that the new deals with nine drug firms bring the total number of manufacturers under the program to 26. Between the two, they account for 89% of the branded drug market.
CSL expands US manufacturing
The CSL drug pricing agreement comes off the back of a similar trend by Melbourne-based CSL expanding its drug manufacturing operations in the United States.
CSL has spent US$1.5 billion on expanding its Kankakee, Illinois, facility, which will be dedicated to plasma-derived therapies and albumin. The expansion will generate at least 300 jobs and follow over US$3 billion on operations in the United States since 2018.
The new deals offer more clarity on its liability for U.S. drug pricing actions and some Section 232 tariffs, CSL said. The company anticipates the arrangements will not have a material impact on its finances through fiscal 2027.
The agreement does not say in the document public disclosure was made which specific medicines of CSL are covered, nor was there any indication of reduction in the individual price.
The United States remains the world's biggest payer on pharmaceuticals, with $205.3 billion on medicine in 2017.
US remains highest pharmaceutical spender
US retail pharmaceutical spending came in at US$1,713 per person in 2023, versus an OECD average of US$766, according to research in OECD's report, Health at a Glance 2025. Germany's was US$1,158, Switzerland's was US$1,061, Denmark's was US$404, Chile's was US$455 and Estonia's was US$458.
The US acquisition comes as good news for CSL, which has been suffering from financial woes due to a poor year. For FY2026, CSL reported revenue of US$15.797 billion, which was higher than the revenue of US$15.558 billion in FY2025, and the statutory net loss was US$2.579 billion. The underlying NPATA was US$3.098 billion.
The new deal is part of a larger U.S. initiative to compel pharmaceutical companies to revise their pricing policies for drugs used in government-run healthcare programs.
Source: The Sydney Morning Herald
Pooja Malik is a business journalist with over six years of experience covering startups, entrepreneurship, and emerging trends. She has previously worked with leading media platforms such as YourStory Media and BW BusinessWorld, where she reported on business, policy, and market developments. Currently, she serves as Editor at The Inspirepreneur Magazine, where she writes and edits stories across business, lifestyle, and travel, with a focus on clarity, accuracy, and reader relevance.
