S. Korea reports 20 coronavirus cases, church service in midst of outbreak

South Korea reported 20 new cases of the coronavirus on Wednesday, including 14 people involved in an outbreak traced to several church services in the central city of Daegu.

The spike in new cases is unprecedented so far in South Korea and brings the number of people infected in the country to 51.

Including the cases announced on Wednesday, 19 have been reported in Daegu and the surrounding North Gyeongsang province, with 16 of them tied to an earlier confirmed carrier, Korea’s Centers for Disease Control and Prevention (KCDC) said in a statement.

The earlier case was confirmed on Tuesday in a 61-year-old woman known as “Patient 31”. She had no recent record of overseas travel but had attended church services and sought care at a hospital before being tested for the virus, the agency said.

Now at least 15 people who attended religious services with Patient 31 have tested positive for the virus. One other person, who came in contact with her at a hospital, has also come down with the disease.

Hundreds of people are believed to have attended services with Patient 31 in recent weeks at a branch of the Shincheonji Church of Jesus the Temple of the Tabernacle of the Testimony, a religious movement founded in 1984 by South Korean Lee Man-hee, who is revered as a messiah by followers.

On Tuesday, Shincheonji Church posted a statement on its website confirming the woman had attended services and advised its members to stay home. It encouraged members who had attended meetings on Feb. 9 and 16 to be tested and quarantine themselves.

“The Daegu branch has been shut down since this morning and is conducting prevention measures,” the statement said.

Health authorities view the Daegu case as a “super-spreading event”, KCDC Director Jeong Eun-kyeong told briefings on Wednesday.

Besides the church, Patient 31 also visited a hotel and, eventually, a hospital, Daegu mayor Kwon Young-jin said in a Facebook post.

None of the woman’s family members have shown symptoms, while taxi drivers who were in contact with her are now in self-quarantine, Kwon said.

A clinic that treated Patient 31 after a traffic accident on Feb. 6 said she refused to be tested for the virus at that time, despite a fever, because she had not traveled abroad recently or been in contact with known patients.

KCDC officials said they were reviewing policies governing people who refuse to be tested, and added police could be involved in such cases.

After her symptoms worsened, she was finally tested for the virus on Feb. 17, according to the KCDC.

The virus has killed more than 2,000 people, mostly in mainland China, and spread to more than two dozen countries, causing widespread economic and travel disruptions.

Excluding the epicenter of the outbreak in Hubei Province, however, the number of new cases in mainland China has now fallen for 15 straight days.

South Korean President Moon Jae-in has called for stringent infection control measures and every possible action to boost the economy, which he said was in an emergency situation as the result of the epidemic.

https://www.reuters.com/article/us-china-health-southkorea-cases/south-korea-reports-20-new-coronavirus-cases-church-services-at-center-of-outbreak-idUSKBN20D02O

China’s virus-hit industrial cities start to ease curbs, restore production

Big manufacturing hubs on the Chinese coast are starting to loosen curbs on the movement of people and traffic while local governments prod factories to restart production, following weeks of stoppages due to the coronavirus outbreak.

In their early efforts to contain the virus, authorities extended a week-long Lunar New Year holiday in late January by about 10 days, instituted quarantines, and imposed restrictions on traffic in large parts of the country.

The measures slowed the sprawling industrial sector to a crawl, with companies unable to resume production or restore output to normal levels due to a lack of workers. Many have also been unable to take delivery of raw materials or send products to clients due to logistical hurdles, with the disruptions knocking on along supply chains worldwide.

China is conscious of striking a balance between stamping out an epidemic that has infected more than 70,000 people – killing more than 2,000 of them – and shielding the already weakened economy from more damage.

The city of Foshan, a large manufacturer of electronics and household appliances in the southern province of Guangdong, said late on Tuesday that businesses no longer needed to seek approval before resuming operations and they need not require returning workers to show proof of their health.

On Monday, the nearby city of Zhongshan similarly lowered such administrative barriers.

In the eastern province of Zhejiang, known for its bustling private sector, the cities of Hangzhou and Ningbo over the weekend also pared back the approval process for companies looking to restart.

“Macro and micro data suggest production activities are resuming at a slow pace in China, reaching 60-80% of normal levels by end-Feb and normalizing only by mid-to-late March,” Morgan Stanley wrote in a research noted.

“If the spread of the virus is not contained within the next two weeks, the disruption to production could extend into the second quarter.”

Analysts polled by Reuters expect China’s growth could slow to 4.5% in the first quarter from 6% the previous quarter [ECILT/CN]. But some recently downgraded forecasts are in the 3-4% range, citing delays in resuming production.

TRAINS, PLANES AND CARS

More than 50% of the bigger industrial enterprises in Guangdong, Jiangsu and other large provinces, as well as Shanghai, have resumed production, an official at the National Development and Reform Commission told a briefing in Beijing.

Some cities in Guangdong and Zhejiang this week organized buses and trains to ferry workers back from their hometowns.

The city of Taizhou, in Zhejiang, even arranged for several planes to pick up workers from Chongqing, Guiyang, Chengdu, Kunming and Xian, with the local government of Taizhou footing a third of the bill.

Labor shortages are relatively acute in Zhejiang, Ge Pingan, an official at the Zhejiang government’s human resources department, said.

As of Tuesday, 21,800 workers had been ferried back to the eastern province on chartered flights or buses, Ge told a briefing.

Most listed companies in Zhejiang are expected to resume production by the end of February, an official at the Zhejiang securities regulator told the briefing.

The outbreak has also chilled consumer demand and hammered the services sector, with restaurants, hotels, cinemas and travel agents among the hardest hit.

China’s auto market, the world’s largest, is likely to see sales slide more than 10% in the first half of 2020 because of the epidemic.

In a bid to revive consumption, Foshan announced stimulus measures for its auto market, the first city in China to do so in the virus outbreak.

The city government will offer subsidies of 2,000 yuan ($285) for purchases of new cars and 3,000 yuan for replacement of existing cars, according to a document published on Feb. 3 on its website.

Foshan, where Volkswagen (VOWG_p.DE) has a car plant with FAW Group [SASACJ.UL], will also offer subsidies to help offset the marketing expenses of auto companies.

https://www.reuters.com/article/us-china-health-economy/chinas-virus-hit-industrial-cities-start-to-ease-curbs-restore-production-idUSKBN20D0PB

Adidas, Puma warn of coronavirus hit to China business

German sportswear makers Adidas and Puma both said on Wednesday that the coronavirus outbreak was hurting their business in China due to store closures and fewer Chinese tourists travelling and shopping in other markets.

Adidas and Puma make almost a third of their sales in Asia, which has been the major growth market for the sporting goods industry in recent years. The region is also a key sourcing hub, with many sneakers produced in China and other Asian countries.

Adidas said in a statement that its business in the Greater China area had dropped by about 85% year-on-year in the period since Chinese New Year on January 25.

Adidas said it had also seen lower shopper traffic, mainly in Japan and South Korea, but added that it had not yet registered any major business impact beyond Greater China.

“The magnitude of the overall impact on our business for the full-year 2020 cannot be quantified reliably at this point in time,” it said, adding it would give more details when it publishes 2019 results on March 11.

Adidas sells its products from about 12,000 stores in China, most of them franchises plus less than 500 own-operated stores.

Puma said it expected the virus outbreak to hit its sales and profits in the first quarter but it still hopes to reach its targets for 2020.

Puma said more than half of its stores in China were temporarily closed and the decline of the Chinese tourism business was also hurting other markets, especially in Asia.

It said the uncertainty about the duration of the virus made it difficult to forecast but it is working under the assumption that the situation will normalise in the short-term.

In the fourth quarter, Puma reported its strongest sales growth in the Asia/Pacific region of a currency-adjusted 23%.

https://www.marketscreener.com/ADIDAS-AG-6714534/news/Adidas-Puma-warn-of-coronavirus-hit-to-China-business-30017421/

Foreign pilots at China airlines go home on unpaid leave as demand plummets

Foreign pilots at some Chinese airlines have returned to their home countries and are considering other jobs after being placed on unpaid leave as demand falls because of the coronavirus, affected flight crew told Reuters.

Meanwhile, Chinese pilots with greater job security said their income has been sharply reduced because most of their pay is based on flying hours.

Data firm OAG estimates about 80% of scheduled airline capacity to, from and within China has been cut this week because of SARS-CoV-2, the virus that has killed more than 2,000 people. Chinese airlines have been the hardest hit.

Major employers of foreign pilots, including China Southern Airlines Co Ltd and HNA Group’s Hainan Airlines Holding Co Ltd, have acted swiftly to cut their losses, according to pilots and industry experts.

China Southern did not respond immediately to a request for comment, and HNA declined to comment.

“All the foreign pilots are on leave until the virus situation gets better,” said an expatriate captain at China Southern who, like all of those who spoke to Reuters, requested anonymity because he was not authorised to speak with media. “For the moment we are all in our home countries.”

Expats are typically paid more than local staff and work on contracts, which means they are more expendable in a downturn, industry experts said.

“We have seen pilots heading back to Australia in January and February due to the stand down and seeking new roles,” said Kirsty Ferguson, the head of Sydney-based airline interview coaching firm Pinstripe Solutions.

As China’s airline sector ballooned, it imported foreign experience: the number of foreign pilots flying with Chinese airlines more than doubled to over 1,500 between 2010 and 2019, according the Civil Aviation Administration of China.

China will need another 124,000 pilots in the next 20 years, according to Boeing, as an expanding middle class drives demand for air travel. But foreign pilots said being put on leave without pay makes it less likely they’ll return when demand recovers.

A foreign captain at Fuzhou Airlines, part of HNA Group, said he was placed on unpaid leave when the virus hit and was concerned it would be permanent.

“They hope people will find other jobs as none can go without pay forever,” he said. “This way they ‘save their face,’ and secondly they don’t feel obliged to dismiss you properly according to the contract.”

The pilot said that he was looking for jobs closer to home, but that so far those options paid less than in China. Foreign pilots can make more than $300,000 a year there, making it one of the best-paying markets in the world.

A pilot at Tianjin Airlines, also part of HNA Group, said he was told it would be at least three to four months before the carrier starts recalling expatriate captains. He has found work with another foreign airline, he said.

Hainan has also placed more than 200 foreign cabin crew members on 30 days of unpaid leave which could be extended, an affected flight attendant said.

HNA declined to comment.

A local pilot at China Southern said he was barely flying and as a result was receiving only his base salary, roughly 1/6 to 1/8 of his normal pay.

“What we can do now is keep a good mentality and enjoy the company of our family at home,” he said. “Eat well, sleep well and exercise well and keep learning. Build up the energy so that we’ll be well prepared for whatever comes later.”

https://www.marketscreener.com/CHINA-SOUTHERN-AIRLINES-C-6497362/news/Foreign-pilots-at-Chinese-airlines-return-home-on-unpaid-leave-as-demand-plummets-30016538/

FDA calls states’ bluffs on drug importation

For decades, critics of the U.S. drug pricing system have advocated importing drugs from Canada as a convenient shortcut to lower prices. The Food and Drug Administration’s recent release of a proposed regulation to create a process for approving state-sponsored importation plans is one step closer to that goal. A closer look shows that it’s actually a false step.

Career FDA staff, supported by previous FDA commissioners and Health and Human Services secretaries, have long maintained that there is no way to open a drug import channel into the U.S. pharmaceutical supply chain without violating the 2003 law authorizing Canadian drug imports that required the FDA to certify that importation would create no safety risk to the public. Now, with a heavy twist of the arm from President Trump’s strong support for importation, the FDA has been forced to describe a possible pathway for it.

Importation has never been about actually bringing drugs into the U.S. — it’s about bringing their prices here. The drugs that people want to import are not like Caspian Sea caviar, French Bordeaux, or Chilean sea bass. The drugs Americans want are already available in the U.S. in plentiful quantities, and some are even produced or finished in U.S. factories. But the U.S. wholesale price of these drugs is often multiples of what drug companies charge purchasers outside the U.S. Inconveniently, we can only import the prices along with the actual drugs.

Bills in the House of Representatives (H.R. 3) and the Senate (S. 2543) that take direct aim at high drug prices make drug importation from Canada seem like a bit of an anachronism. However, it is an anachronism that enjoys widespread support as a quick fix since these bills are far from certain to advance in the near future. Florida has already advanced a detailed drug import plan, and several other states have taken steps toward devising their own plans. With Florida a likely battleground state in 2020, the president is eager to deliver its voters lower drug prices.

Enter the FDA. Its 44-page proposal, published formally in late December, is serious and well thought through. To ensure the safety of the U.S. drug supply, FDA has set out a detailed, complex, step-by-step process that a state would need to follow if it wishes to import drugs for its Medicaid and other state programs, or for use by private health plans.

To do its best to ensure safety, the FDA proposes allowing only the shortest possible supply chain: manufacturer to exporter to importer to patient. While that makes sense, it also creates a practical problem for the program’s success: Why would a manufacturer sell its drug to anyone who is going to ship it into the U.S. and undercut its prices here?

In other countries with active drug sales across country borders, such as those in the European Union, exporters can buy their drugs from other wholesalers, and even pharmacies, through a process of drug arbitrage in which they find products in low price markets and resell them in high price markets. That would not be allowed if the FDA regulation becomes final.

And then there is the issue of why Canada would participate in this scheme when exports from the country’s small market could create supply shortages that would harm Canadians. Health Canada has already signaled it would “take action to ensure Canadians have uninterrupted access to the prescription drugs they need.” The FDA proposal has given the Canadians an easy path to such action. To serve as a drug exporter, a Canadian entity must have — you guessed it — a license from Health Canada. How quickly would Canada impose a new licensing requirement that prohibits participation in the U.S. import program?

Even assuming that a Canadian exporter can get its hands on enough product to export, and that the Canadian government decides to look the other way in the interest of promoting its own businesses or not angering the Trump administration, the proposed rule raises the very real question of whether the costs of complying with its many requirements are worth the savings.

Here are just a few of the duties an importer would have to agree to:

• screening the drugs for damage and counterfeiting
• relabeling the drug with the U.S.-approved label information
• gaining FDA approval for each shipment
• having samples of each shipment tested at an FDA approved laboratory
• creating a system for collecting and investigating any physician or consumer reports of adverse reactions
• sharing with the FDA detailed records that each requirement has been met

Each of these is costly, and a misstep could lead the FDA to terminate an importer’s ability to do business. Like a regulatory game of Jenga, the FDA has also stipulated that if the courts remove any piece of its process, the entire thing tumbles down and the FDA will terminate this entire importation plan.

And yet the FDA is saying, “If you really want to try, go for it!” Whether anyone takes the agency up on the offer will depend on what the final rules look like. I anticipate that importation proponents will raise objections to some of the requirements in comments that are due by March 9. Based on typical regulatory timetables, the FDA could finalize its rule and be open to considering state applications as early as this summer.

Given the political momentum behind importation, it’s a safe bet that one or more states will take up the challenge and at least initiate the process of gaining FDA approval for its importation plans and start the process of seeking a U.S.-based drug wholesaler or pharmacy partner. But given the approach FDA is proposing, it’s a long shot that states will see significant savings, or even enough to justify the cost of setting up such a program.

If drug importation is not the answer to high drug pricing, it will continue to fall to Congress and the White House to see if agreement is possible on any of the current proposals for the U.S. to directly deal with prices rather than delegating that role to our neighbors to the north.

FDA calls states’ bluffs on drug importation

Warren Buffett shocks Wall Street with Biogen gamble

Biogen is trying to resurrect two failed trials of its Alzheimer’s drug aducanumab – and superstar investor Warren Buffett thinks the volatile stock is worth gambling on as the company prepares for an FDA review.

The pharma is preparing an FDA filing after saying that aducanumab appeared to work in patients treated at a higher dose late last year.

This was despite saying that overall data from the EMERGE and ENGAGE trials did not support approval in March last year.

The decision is down to an effect seen in patients exposed to the higher dose of the drug in an extended dataset that was not available at the cut-off point in March.

Whether the FDA agrees is yet to be seen but Buffett, long seen as one of the most influential US investors, thinks the move could pay off.

Buffett’s Berkshire Hathaway has built a $192 million stake in Biogen, according to a regulatory filing detailing late last week.

Bloomberg reported that Biogen’s stock climbed 1.6% to $338.40 after Berkshire, based in Omaha, Nebraska, disclosed its holding.

It has not historically been a big investor in biotech, although it does have a stake in troubled Teva Pharmaceuticals.

Buffet has also been upping his investment in the supermarket chain Kroger, and had built an investment of $549 million at the end of the year.

However the stake in Biogen is small compared with some of Buffett’s other investments – its investment in Apple was cut by 1.5% in Q4 but was nevertheless value at $72 billion at the end of the year.

The news drew a strong response from twitter, where market watchers expressed surprise at Buffett’s decision.

Warren Buffett Made Some Surprising Buys And Sells For Berkshire Hathaway In Q4. https://www.investors.com/news/warren-buffett-buys-kroger-biogen-sells-apple-q4-2019-13f/?src=A00220&yptr=yahoo … Buffet buying shares in $biib. He must like $biib pipeline drugs and potentials including $biib partnership with $ions.   $biib $ions

Warren Buffett Buys Kroger, Biogen, Sells Apple And Bank Stocks In Q4 | Investor’s Business Daily

Berkshire Hathaway bought Kroger and Biogen, but Warren Buffett further pared his stakes in Apple, Wells Fargo and Bank of America.

investors.com

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05:52 – 15 Feb 2020

This is shaping up to be a pivotal year for Biogen – any approval in Alzheimer’s could be worth billions given the size of the market, and the fact that a new drug has not been approved since 2003.

Whether other major investors have the conviction to follow the example of the man known as the “Oracle of Omaha” remains to be seen.

Warren Buffet shocks Wall Street with Biogen gamble