CSL to pay US$64m to settle class action suit

CSL (ASX:CSL) has agreed to pay US$64 million ($67.7 million) to settle long-running antitrust legal action involving allegations it conspired to drive up the price of plasma-derived protein therapies.

Some US and Puerto Rican hospital groups had sued CSL and industry trade association Plasma Protein Therapeutics Association (PPTA) in 2009. The claims were consolidated into a class action suit.

The plaintiffs alleged that CSL Behring and Baxter International - which together have a majority share of the plasma therapy market - met through the PPTA to drive up prices by artificially shrinking supply. CSL has denied the allegations.

The settlement requires US federal court approval but, if accepted, will resolve and dismiss all claims made by members of the class action lawsuit.

CSL CEO Paul Perreault said the company negotiated the settlement to put the lawsuit behind it.

“While we continue to strongly reject any allegation of wrongdoing, we have negotiated a settlement of the litigation which we believe is in the best interests of the company and our shareholders,” he said.

“To pursue the case further would have required several more years of management time and focus as well as substantial additional legal costs with no absolute certainty of the outcome.”

If the settlement is approved, CSL disclosed a resulting one-off charge will reduce its profit expectations for FY14 to the tune of $39 million. But the company still expects net profit growth for the financial year of around 7% in constant currencies.

CSL (ASX:CSL) shares were trading 0.23% lower at $65.05 as of 1.30 pm on Thursday.