MSB Trading 2021 - paradigm shift, page-9197

Apologies, I need to add a caveat to my previous comment:

"... to the extent that we generate taxable profits in Australia and the US, then there is a huge benefit!!"

Bear in mind the current MSB structure is set up to realise profits in the low tax jurisdictions of Singapore (manufacturing margins) and Switzerland (IP royalties).

Very little profit will be generated in Australia - very few end user sales, a bit like CSL which pays very little Australian tax as evidenced by the fact that most dividends are unfranked. And very little IP owned by an Australian MSB entity, so minimal royalty inflows. As an aside, don't expect franked dividends!

Some profits will accrue in the US through royalties, although apart from some early high value patents all the IP has been shifted to Switzerland (and those patents still held by Mesoblast Inc in the US will shortly expire, if they haven't already). The US will, of course, generate some profits from end-user sales, although transfer pricing should hopefully ensure that most of these are captured in the manufacturing margin in Singapore.

So either way, the tax losses may not be the asset we might think they are!