Scorecard Needed for Today’s Drug Industry Dance: Opening Line

People have money to spend.

In what resembles one of the NBA multiplayer trades, Novartis will buy Glaxo’s cancer-drug operations and sell Glaxo its vaccines business -- except for flu drugs, which it will sell to someone else -- while creating a joint venture with Glaxo for consumer health and selling its animal-drugs business to Lilly. This involves many billions of dollars. Still developing at this hour.

Late yesterday, Bill Ackman and Valeant Pharmaceuticals revealed their plan to go after Allergan in an unsolicited cash-and-stock takeover offer for the maker of Botox for even more billions.

It’s unclear who enlisted whose help. Valeant had made its intention clear that its goal was to be one of the world’s five biggest drugmakers, so if they reached out to Ackman and Pershing Square first, it would make sense. Could be the other way around. Who knows what drives Ackman sometimes. Maybe he saw a wounded deer and decided it needed shooting.

The exact offer price isn’t set yet, according to the filing, which says however that the cash part of the bid would be about $15 billion. Allergan has a market value of about $42.5 billion.

So, health and pharmaceuticals are back in play.


We’re getting the feeling that the Basel Committee on Banking Supervision is to the world’s largest banks what gun laws are to the NRA -- an annoyance that will be quickly be overrun by those who would be the regulated.

Once again we have proposed regulations, this time on the size of counterparty risk, that are coming back home half-dressed after getting worked over by the banks. Like liquidity standards and leverage ratios, a proposal (just the word “proposal” sounds soft) on limiting counterparty holdings has been neutered to allow banks to keep most derivatives and repurchase contracts they share.

“That seems to be the name of the game, fighting every rule to the ground,” Anat Admati, a Stanford University finance professor, tells Yalman Onaran, who notes that 95 percent of banking-derivatives contracts in the U.S. were concentrated at JPMorgan Chase, Citigroup, Bank of America, Goldman Sachs and Morgan Stanley at the end of last year.

It’s not a question of too big to fail but of being too interconnected to fail, and banks are too strong to let a collection of multilateral regulatory bodies -- 45 regulators in 27 countries, all with their own fiercely lobbying constituencies -- push them around. Yet Onaran finds some reason to believe in the efforts.

“To say that nothing has changed is oversimplifying. It’s better than nothing,” he tells us. “In three out of seven rules, or five out of 10, it’s been so watered down that the impact seems to be nonexistent, which means that a lot of the rules are pathetic. But in some of them, they have had an impact, so there has been improvement.”

Banks fall back to the same warnings that leave any government nervous about the effects of its good intentions -- threats to economic growth, lost jobs and revenue, and innovation.

“You obviously don’t want crises, but if you stifle innovation, you might not expand the pie,” John Neary, former head of U.S. equities trading at Morgan Stanley, told Onaran last year.

Is this what he means by innovation? And whose pie is it, exactly?


It’s a delicate moment in Europe. The economic recovery is tenuous, inflation is anemic enough that the IMF coined "lowflation" to describe it, the euro is rising right when no one wants it to, and there’s a mess over in Ukraine that threatens Europe’s reliance on Russia’s energy.

Which is why this week’s European economic data, starting with euro-area consumer confidence today, the Markit manufacturing survey tomorrow and the Ifo index of business confidence in Germany, Europe’s largest economy, will get some extra attention.

Draghi is scheduled to speak to the Dutch central bank moments after the Ifo report, and last we heard from him, he said pretty flatly that the euro is forcing the ECB’s hand into delivering easy money and stimulus programs if needed.

“There’s no question Draghi crossed a rhetorical threshold at his last press conference, holding out the prospect of QE and negative interest rates,” says Dan Moss, executive editor for economy and international government. “Since then, we haven’t heard a lot from him, so it’s into that vacuum that this data is coming.”


Existing-home sales is the highlight of the U.S. economic reports today, which also sees the news cycle wading deep into corporate earnings reports. Today we’ll hear from McDonald’s, Simon Property, Comcast, BONY-Mellon, Lockheed Martin, Xerox and AT&T among many others. Tomorrow there are even more.


You’ll get another chance to see your money at work today in what has to be the best use of it -- buying a political office. Well, maybe not your money. Actually, maybe it is your money.


Clearly the Obama administration is getting serious now with the Ukraine crisis. While pro-Russian forces (or, as the New York Times reported yesterday, just plain old Russian forces) fan out now to 10 cities in eastern Ukraine, and while 40,000 uniformed Russian troops remain massed at the border locations with no signs of budging, Obama is pulling no punches. He’s sending Biden to Kiev.

That’s right. And what’s more, Biden is going to unveil a package of technical assistance and pursue more talks on additional nonlethal security aid. Brutal.

Biden also will deliver a speech, and if we’re the Russians, that might be the scariest move yet. Remember when U.S. forces flushed Noriega out of the Vatican’s embassy in Panama by subjecting him to Van Halen and Howard Stern? It’s kind of like that.

We’re not sure how long Putin will be able to hold out with his chicanery with this kind of heat. No use going to Assad for any advice. Look how he was dealt with.


After spending all day out on the north 40 mending a quarter-mile of split-rail fence before moving in 300 head of cattle, when it’s already 90 degrees in the Texas shade in April and the dust is caked inside the folds of your skin, nothing will beat the feeling of peeling off those dirty dungarees and easing into a piping hot bathtub full of what used to be your neighbor’s urine.


It starts out innocently enough. Instead of going to Blockbuster, Netflix says they’ll send you the DVD in the mail for a flat monthly fee. Then, after your postal carrier starts muttering your name during rounds, the company figures out how to dispense with the discs and just pipe the movie right onto your computer. Corner drug dealers nod knowingly.

Then this movie-rental company, which has amassed at least a couple hundred dollars from Chez Opening Line for a DVD copy of Louis Malle’s “Elevator to the Gallows” (1957), which we rented -- no lie -- a year or two ago and which we still have in the TV room, thought, well, we’ve got the pipeline, why sell them other people’s stuff? We’ll sell our own stuff.

Before long, you’re unwashed in sweatpants you’ve been wearing for four days, the sticky residue of “House of Cards” all over your fingers and everything else in that dimly lit room, your cat is now afraid of you and you’re so strung out that you’re seriously considering moving on to “Brian Posehn: The Fartist” because you’ve just Hoovered up everything else they laid out for you.

That’s when the price starts to rise. What are you going to do? Quit? Ha. Remember this day when you’re pushing your cart past the Netflix Tower in...wherever Netflix is. Tijuana, probably.


In yesterday’s shootings, a woman was shot in the parking lot of a mall in the Atlanta area, two people were shot randomly outside the Smithsonian National Zoo in Washington, a law-enforcement officer shot and killed a defendant in the Salt Lake City federal courthouse after the defendant attacked a witness, and Southwestern Oklahoma State University was placed on lockdown for a few hours after reports of a gunman loose on campus. Because, you know, it’s been a couple weeks.


Anybody get the license of the truck that hit the Columbus Blue Jackets last night? Here we were thinking they were about to win their second playoff game ever so soon after winning their first, and then three goals in two minutes from the Penguins. Scary. Pens lead the series 2-1.

In other NHL playoff games, Minnesota ground out a 1-0 overtime win in a punishing game with Colorado, which still leads the series 2-1; Chicago beat St. Louis 2-0 after losing the first two games of the series; and Dallas shut out Anaheim 3-0 to pull to within 2-1 in their series.

Two games last night in the NBA playoffs, with Memphis tying their series at 1-1 with a 111-105 win in overtime against Oklahoma City, while the Los Angeles Clippers rebounded after losing the first game against Golden State with 37-point margin of victory, 135-98.

And back in the U.K.’s Premier League, it seems filling Alex Ferguson’s shoes at Manchester United is a bigger job than David Moyes knew.

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