CSL Limited Annual Report 2021/22 27 We expect some cost pressure due to inflation and other supply chain factors. At the time of this writing, inflation is the highest in decades due to supply chain uncertainty, geopolitical challenges including the war in Ukraine and other factors. While policy makers have signalled the priority for fighting inflation, inflation could remain elevated for a sustained period. Given the markets we serve, we aim to grow sustainably through cost containment and productivity measures, such as yield improvements. We also expect significant competition from companies manufacturing products similar to ours and the uncertain impact of substitute products that are on the market or in development. The entry of anti-FcRn products may also represent a competitive threat, however demand for plasma products, particularly immunoglobulin, is expected to continue in the long-run driven by diagnosis of diseases such as primary immunodeficiency disease (PID). In the near term (3-5 years) immunomodulation indications where FcRns may receive approval are not expected to be substitutes for our immunoglobulin products. In addition, other competitors are exploring the use of novel technologies, such as mRNA, in the influenza vaccine space. More information in relation to our outlook is provided in our full year investor briefing presentation, and further information on the factors that could affect our outlook is provided in Our Material Risks on page 24. CSL Outlook • Demand for CSL Behring’s core plasma products is expected to remain robust. The significant growth in plasma collections is expected to underpin strong future sales of core plasma therapies. • Product differentiation is expected to continue to drive strong demand for CSL Seqirus’ influenza vaccines. • The company anticipates a strong financial performance and a return to growth in FY2023. Business strategies, prospects and likely developments This Operating and Financial Review (OFR) sets out information on CSL’s business strategies and prospects for future financial years, and refers to likely developments in CSL’s operations and the expected results of those operations. Information in the OFR is provided to enable shareholders to make an informed assessment of the business strategies and prospects for future financial years of the CSL Group. Certain information is excluded from the OFR (which forms part of the Directors’ Report) on the basis that such information relates to impending developments or matters in the course of negotiation and disclosure would be unreasonably prejudicial to the interests of CSL. Reasons that could be considered unreasonably prejudicial to the interests of CSL include providing information that is misleading due to the fact it is premature or preliminary in nature, relates to commercially sensitive contracts, would undermine the confidentiality between CSL and contract counterparties, or would otherwise unreasonably damage CSL. The categories of information omitted include forward looking estimates and projections prepared for internal management purposes, information which is developing and susceptible to change and information relating to commercial contracts and pricing.
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