How Trump’s antivaxxers helped trigger Aussie giant’s $50b implosion

By February this year, one thing was clear – the US was experiencing one of its worst flu seasons in decades.

According to a preliminary assessment from the US Centres for Disease Control (CDC), up to 99,000 deaths were linked to the 2024/25 flu season, which was one of the deadliest seasons on record for children.

It was a brutal lesson for a country dogged by growing mistrust of vaccinations - ranging from scepticism to outright anti-vaxxer rage - and post-pandemic vaccine fatigue. But for ASX-listed Australian pharmaceuticals giant CSL, the signs were promising. A vicious flu season usually translated to bumper demand for its flu vaccine in the US, which is CSL’s single biggest market by far.

That was until Donald Trump’s health secretary, Robert F. Kennedy Jr, handed CSL’s management and investors a brutal lesson of his own: America’s rage against science is not going anywhere just yet.

CSL shocked financial markets this week with the admission that, despite two years of declining vaccination rates in the US, it still can’t find a bottom to the market.

“Vaccination rates are a surprise to us. It’s true,” company chair Brian McNamee told CSL’s annual meeting this week as its shares dived.

“Did we think the declines we’d already seen in the last two years in the key US market … given the severity of the disease last year … did we expect that vaccination rates would drop again another 14 to 15 per cent? Remarkable, but it’s our reality.”

The vaccine-induced profit downgrade burned as much as $17 billion off CSL’s market valuation and has forced the company to indefinitely delay plans to spin off its multibillion dollar vaccine business Seqirus as a separate entity.

CSL has too much skin in the US game to name who was responsible for this reality check, but some analysts have not been as shy.

“The declining US flu vaccination rates are clearly the result of increased negative sentiment across the broader US population arising from HHS (Department of Health & Human Services) leadership changes … and softer public health messaging under RFK Jnr’s leadership,” Bell Potter health analyst Thomas Wakim, said.

“We don’t think this will turn around in the short term.”

But it would be wrong to suggest the problems started with the latest Trump administration.

Academics report that, at the end of the 2023-24 flu season, 9.2 million fewer vaccine doses had been administered in the US compared to the average before the pandemic, when vaccination rates were increasing steadily.

Flu vaccination in children has dropped from 59 per cent in 2019-20 to 46 per cent in 2024-25, according to Annette Regan, an Adjunct Associate Professor of Epidemiology at the University of California, Los Angeles.

In the highest risk age group, adults 65 years and older, vaccination rates dropped from 52 per cent in 2019-20 to 43 per cent in 2024-25.

Kennedy’s appointment has supercharged vaccine scepticism with job cuts in the CDC and massive upheaval on the panel charged with issuing vaccine recommendations. Respected experts have been replaced with controversial vaccine critics who now have the ability to reshape and undermine the US public’s confidence in vaccines.

“Secretary [Robert F.] Kennedy [Jr.]’s actions repeatedly censored CDC science, politicised our processes, and stripped agency leaders of the ability to protect the health of the American people,” former CDC Chief Medical Officer and Deputy Director for Program and Science Dr Debra Houry told a US Senate hearing last month.

Flu is not the only concern. The US is currently experiencing a measles outbreak and now has the most cases since the disease was declared eliminated in 2000. Republican stronghold Florida, plans to dump all vaccine mandates - including for children.

But the fact that CSL was able to shock the market with the news that vaccine rates have continued to decline by such significant numbers also shines a light on how the CDC surveillance of disease and vaccine supply - which would normally have flagged this issue - has faltered under Kennedy’s cuts.

CSL said it now expects US flu vaccination rates will decline by 12 per cent for the overall population this 2025-26 US winter, and will deliver a “mid-teens” drop in revenue in its business Seqirus.

This is big business for CSL.

According to Bell Potter, 65 per cent of its flu vaccine sales are from the US. It makes up 8 per cent of CSL revenue and 10 per cent of its earnings.

But the irrational vaccine backlash in the US is not the only issue for CSL, which has seen more than $50 billion stripped from its valuation this year.

Trump has played a key role, and so has CSL’s management with their own missteps.

Trump has lined up “Big Pharma” as one of his public enemies for overcharging US consumers and has threatened the sector with tariffs of up to 250 per cent on pharmaceuticals. This could affect $2 billion worth of Australian exports, and the single biggest impact is expected to be on CSL’s US exports, which are dominated by plasma products.

But CSL, the sharemarket’s perennial growth machine, has also lost its mojo. And with it, the massive premium the market put on every earnings dollar it generated.

Thousands of job cuts, and a restructure announced in August, are designed to reinvigorate the group which has seen its earnings multiple de-rate from 30 times earnings to just 16, meaning investors have almost halved the value they ascribe to each dollar of earnings.

Analysts are still cautious on the stock after the latest bad news.

“Whilst we see upside on a 12-month view, we think investors are not yet convinced that this is a true clearing event and that CSL is now a ‘show-me’ story,” Citi analyst Laura Sutcliffe said this week.

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