Why CSL Ltd Stock Could Be Worth a Look FDA approval of costly--but worthwhile--drug leads the momentum that could make CSL Ltd an equally worthwhile investment.

Approaching the final week of November CSL Ltd ADR (OTCMKTS: CSLLY) received some good news as the United States Food and Drug Administration approved CSL Behring's new gene therapy drug, HEMEGENIX (etranacogene dezaparvovec-drib) for treating hemophilia B. The news helped continue the stock's upward momentum, a trajectory that has been mostly consistent for at least the last four years.

Based in Australia, CSL Behring (AXS: CSL) is a segment of CSL Ltd, which trades under the ticker symbol OTCMKTS: CSLLY in the US market. Their other segments include CSL Plasma, CSL Seqirus, and CSL Vifor; all of which address various aspects of biotechnology and health services.

CSLLY stock's current value is sitting in a good place: breaking the $100-theshold and resting just below the all-time high ($117.74 USD). Combined with a decent forward dividend yield of 1.11% and projected earnings growth of more than 21%, there could easily be more to come from this company (and its interconnected segments).

November 2022 Was Good to CSL Behring

This late November development is just the latest advance in what has been a busy month for CSL Behring. For example, earlier in the month the company announced its collaboration (and licensing agreement) with Arcturus Therapeutics Holdings, Inc (NASDAQ: ARCT). This partnership would develop and improve capabilities for large-scale clinical supply delivery; in particular enabling CSL to deliver mRNA vaccines to market more efficiently and effectively. These mRNA vacccines would eventually help treat common diseases like the flu and Covid-19.

The positive coverage of both the Arcturus collaboration and the HEMGENIX approval helped raise the price of CSL stock during November. Then, on November 23, CSL Limited share price broke through $300 (AUD) for the third time in all of 2022, closing out the month at $300.11 AUD. That is up 6.92% from the month prior. It has since settled back down a little, just south of that threshold.

Similarly, CSLLY is up +14.62% over the last 30 days; and up +1.21% over the last 90 days.

A High Price With High Potential

The FDA approval comes amidst successful results in the ongoing HOPE-B trial, which happens to be the largest hemophilia-B gene therapy trial to date. So far, results show marked improvement over various study criteria that definitely qualify HEMGENIX as a more attractive treatment option. Effectively, the study found that roughly 94% of patients treated with HEMGENIX discontinued use of their traditional prophylactics.

The price for this new drug is $3.5 million USD per dose, making it the most expensive drug in history. Of course, HEMGENIX is not alone in the upper ranges of drug cost. Take Novartis (NYSE: NVS), for example; their infant spinal muscular atrophy drug Zolgensma sold for $2.1 million USD a dose, upon its approval in 2019. And Bluebird Bio, Inc's (NASDAQ: BLUE) beta thalassemia (blood disorder) treatment Zynteglo was listed at $2.8 million USD only a few months ago.

Of course, this news about HEMGENIX is typically the sort of thing that motivates investors. First of all, an independent nonprofit research organization, the Institute for Clinical and Economic Review (ICER), has determined that a fair price for HEMGENIX should be around $2.95 million USD. They determine this cost-effectiveness analysis by weighing the drug's health benefits against offset costs. This gives the drug quite a premium, and that means more profit.

In addition, a treatment upgrade means the product will be more attractive to patients, even at a higher price point. Reducing much of the obstacles presented by other treatments can also make it more accessible to patients with particular sensitivities.

Stable Growth Could Make CSLLY Investment Worthy

All this in mind, CSLLY could be a moderate BUY, at least for now. While it is still stabilizing from the recent news, analysts expect at least 10% business growth in the future. And with a 52-week high of $312.92 AUD, CSL could be on its way to a record high in no time. CSLLY currently pays an annual dividend of $1.08 per share and has a dividend yield of around 1.1%, which greatly exceeds the 0.1% industry average. This industry category includes biotechnology, pharmaceuticals, and life sciences.

On the other hand, CSL has a Price-to-Earnings ratio (P/E) of 42.98, which is nearly double that of the industry average. This implies that the stock may not grow as quickly as analysts hope. Also, its 10.2 Price-to-Sale ratio (P/S) exceeds the industry average of 4.4. This could mean CSL is probably spending more than it would like to be.