'Thyssenkrupp chair: Keep employees in the company even if they lose their jobs'

 Employees who lose their jobs as part of the reorganization of steel manufacturer Thyssenkrupp Steel Europe should remain with the company. Supervisory Board Chairman Sigmar Gabriel has spoken out in favor of this. "We cannot have any interest in losing even one person whose job will no longer exist as part of the restructuring as an employee," said Gabriel on Friday evening after a Supervisory Board meeting at which the planned restructuring was discussed.

Gabriel: Keeping employees in the company despite job cuts

"We will have a need for several thousand skilled workers in the coming years, which we cannot simply fill due to demographics alone," Gabriel continued. "That's why our goal must be to keep the people whose jobs are now being lost due to the restructuring in the ThyssenKrupp Steel Europe environment, in the qualification company, in the company itself, so that they can gradually compensate for the resulting need for skilled workers." He continues: "We must do everything we can to ensure that the people who lose their current jobs are not lost to us as employees."

The program provides for a significant reduction in steel production capacity in Duisburg. This will be accompanied by job cuts. However, the program has not yet been approved by the Supervisory Board due to unresolved financing issues. It is not known how many jobs will be cut as part of the restructuring. The reduction is to take place without compulsory redundancies

https://www.marketscreener.com/quote/stock/THYSSENKRUPP-AG-436698/news/Gabriel-Keep-employees-in-the-company-even-if-they-lose-their-jobs-47615527/

US releases $3.5 billion to Israel to spend on US weapons, military equipment: CNN

 Washington is set to provide Israel with $3.5 billion to spend on U.S. weapons and military equipment, releasing the money months after it was appropriated by the U.S. Congress, CNN reported on Friday, citing sources familiar with the matter.

The State Department notified lawmakers on Thursday night that the government intended to release the billions of dollars worth of foreign military financing to Israel, CNN reported, adding that the money comes from the $14.1 billion supplemental funding bill for Israel passed in April.

The State Department did not respond to a request for comment on Friday. The action comes amid heightened tensions in the Middle East and fears of the widening of Israel's war in Gaza that has already killed tens of thousands and caused a humanitarian crisis.

There has been an increased risk of escalation into a broader Middle East war after the recent killings of Palestinian Islamist group Hamas' leader Ismail Haniyeh in Iran and of Hezbollah military commander Fuad Shukr in Beirut drew threats of retaliation against Israel.

https://www.yahoo.com/news/us-releases-3-5-billion-194144775.html

Stellantis to lay off up to 2,450 factory workers as classic Ram production ends

 Chrysler-parent Stellantis is laying off as many as 2,450 factory workers from its Warren Truck assembly plant outside of Detroit as the automaker ends production of the Ram 1500 Classic truck.

The layoffs will be effective as early as Oct. 8, the company said, as the plant moves from a two-shift to a one-shift operating pattern in general assembly. Production of the Jeep Wagoneer at the same facility will remain on two shifts, the company said.

As production of the Ram 1500 Classic winds down later this year, the company is shifting focus to the Ram 1500 Tradesman truck, produced at its Sterling Heights Assembly facility.

"We introduced the new 2025 Ram 1500 Tradesman with incredible value and content. The upgraded electrical architecture allows new technologies useful to commercial fleets for better tracking and improved safety systems," a company spokeswoman said.

There are about 3,700 workers at the plant represented by the United Auto Workers union. Union members who are laid off will receive 52 weeks of supplemental unemployment benefits paid by the company, and 52 weeks of transition assistance, Stellantis confirmed. They will also receive two years of healthcare coverage.

The UAW forged new labor deals with Stellantis last fall, after a historic six-week walkout.

Stellantis last week said it was offering a new round of voluntary buyouts to its U.S. salaried workers, the latest in a series of cost-cutting measures CEO Carlos Tavares is implementing at the company's American operations.

At the company's Investor Day in June, Tavares cited weaknesses in at least two of its U.S. plants, but declined to name them.

https://uk.finance.yahoo.com/news/stellantis-lay-off-2-450-171900802.html

NYC’s emergency DocGo contract audit hints at over $11 million in waste, fraud and abuse

 City Comptroller Brad Lander’s damning audit of the Adams administration’s contracts with DocGo suggests the city should recover over $11 million of nearly $14 million paid last year to the controversial migrant-services provider — but why did Lander wait so long to blare the news?

City Hall’s emergency no-bid $432 million DocGo contract wound up spending millions for “shelter” and services that went unused, and with authorizations that went undocumented.

The outrages include charging the city $569,500 to rent out the Crowne Plaza JFK Hotel in Queens for 10 nights, though not a single room was used over that period; in all, taxpayers paid $1.7 million for nearly 10,000 vacant room-nights, earning DocGo $408,680 in commissions in just this two-month period.

And roughly $800,000 in seemingly unauthorized expenses.

The Adams team notes that this was a response to an overwhelming and unprecedented influx of “asylum-seekers” waved in by the Biden-Harris administration — with the city under legal obligation to provide shelter no matter how many showed up on its doorstep.

And it says it cleaned up its act months ago, when Lander’s team first flagged these issues.

Yet it still hasn’t explained why it’s working with DocGo (formally Rapid Reliable Testing NY LLC, since it started off doing entirely different work during COVID) on this stuff in the first place, nor why it’s running the contracts through the Department of Housing Preservation and Development, rather than homeless agencies with long experience on these issues.

Though Nicole Gelinas has been flagging these issues in The Post since last September.

So Lander shouldn’t be too smug about belatedly flagging issues such as “poor fiscal control”: He’s got a whole crew of green-eyeshades types, with statutory power to get at the facts.

Yet he couldn’t start sounding alarms until now, when he is (purely coincidentally!) launching his own mayoral bid?

(Note, too, that Lander opposes key Adams moves to reduce these expenses: He calls the mayor’s 60-day shelter limit for migrants “cruel.”)

The Comptroller’s Office used to be a reliable auditor of city government, and its professional staff surely did fine work here; it’d be nice to get their report straight, not through the prism of Lander’s ambitions.

Above all, New York should step beyond politics to rethink the entire migrant-shelter concept: It’s not only burned billions, but created perverse incentives for even more people to illegally cross the border and come here.

That’s a far larger scandal in its own right.

https://nypost.com/2024/08/08/opinion/nycs-emergency-docgo-contract-audit-hints-at-over-11-million-in-waste-fraud-and-abuse/

Cisco Prepares Second Round Of Layoffs Amid Increasing AI Skepticism: Report

 The potential of generative AI to transform companies, industries, and societies has been widely touted around the clock by Wall Street analysts and MSM, resulting in what could be a trillion-dollar spending spree in capital investments by companies in the coming years. These investments will cover data centers, chips, AI infrastructure, and the power grid. However, given this context, as AI infrastructure is being built, one of America's largest networking equipment firms building AI infrastructure could be on the verge of thousands of layoffs. This news doesn't bode well for the AI bubble. 

Reuters, citing 'people familiar with the matter,' reports that Cisco plans to cut thousands of jobs in a second round of layoffs. These cuts could be similar in scale to the 4,000 layoffs in February and may be announced as early as next Wednesday.

Cisco is the largest maker of routers and switches that direct internet traffic. The company announced plans to deliver AI infrastructure solutions to data centers with Nvidia earlier this year. Sluggish demand and supply-chain constraints could indicate an emerging slowdown in building an AI compute-based environment. 

The latest data from Bloomberg shows Cisco employed around 84,900 people as of July 2023. That number does not include the February layoffs that Reuters first reported. At the time, we penned this note: "Cisco To Fire "Thousands, Adding To Firehose Of Tech Layoffs Since Beginning Of 2024." 

The bear market in Nvidia has some questioning valuations and whether the AI bubble has reached a near-term peak.

In early July, Goldman's Allison Nathan said despite the rising spending trends in "data centers, chips, other AI infrastructure, and the power grid" by companies, this has yet to translate into "efficiency gains among developers." 

The developing theme is that investor enthusiasm about the potential financial returns from AI has shifted to skepticism. In short, the trillions in market cap gained by the Big 7 - the biggest bubble in history - has yet to produce adequate returns. 

Potential Cisco layoffs, which would be the second round of the year, are an ominous sign for the stability of the AI bubble.

https://www.zerohedge.com/markets/cisco-reportedly-prepares-second-round-layoffs-amid-increasing-ai-bubble-skepticism

Avidity Drops Hammer On Sarepta

Avidity Biosciences (RNA) unveiled promising results for its Duchenne muscular dystrophy treatment on Friday. .

Patients with Duchenne muscular dystrophy, or DMD, don't make enough dystrophin. The dystrophin protein helps keep muscles intact. After receiving Avidity's drug for four months, patients had a 25% increase in dystrophy production and reached dystrophin levels that were at 54% of normal.

Chardan analyst Keay Nakae lists RNA stock as a top pick for 2024. He says the results help validate Avidity's approach. The drug, del-zota, works by skipping a genetic mutation called exon 44 to boost the production of dystrophin.

"This data positions the company to continue to evaluate additional DMD 44 patients in order to accumulate sufficient patient experience that could support a possible accelerated approval," Nakae said in a report to clients.

https://www.investors.com/news/technology/biotech-stock-avidity-biosciences-rna-stock-sarepta-therapeutics-duchenne/

'Gardasil Chinese Distribution Issue Still a Mystery to Analysts'

 

After Merck noted the issue in its Q2 earnings call without providing specifics, analysts are left in the dark about the HPV vaccine’s future in China.

Merck’s Q2 earnings last week began with good news as the cancer drug Keytruda and its HPV vaccine Gardasil continued to pull in billions of dollars in sales. However, management did note an issue with Gardasil.

On the earnings call, Merck CFO Caroline Litchfield said there was a “significant step down” in shipments from its distributor in China, causing “above-normal inventory levels” of Gardasil. The vaccine’s Chinese distributor, Chongqing Zhifei Biological Products Co., had apparently sold less of the HPV vaccine than in past quarters. While the situation has caused some unease among investors and a drop in Merck’s stock price, the overall magnitude and reasons for the distribution issue are unclear. However, experts believe that if it continues, it could have a negative impact on sales in the long run.

“I think the shocking thing was the level of uncertainty,” Evan Seigerman, managing director and senior research analyst at Bank of Montreal Capital Markets, told BioSpace.

Likewise, Vamil Divan, a healthcare equity research analyst at Guggenheim Securities, said he was surprised at how little Merck revealed about the situation on the call, but he said there is “obviously a demand issue” at play.

This situation with Gardasil comes as Merck’s leading revenue maker, Keytruda, faces a patent cliff in 2028 and wider biosimilar competition.

Gardasil and the Chinese Market

Divan told BioSpace that Gardasil is Merck’s second most important product, as vaccines can give companies a long-standing revenue stream. Indeed, Gardasil brought in $2.4 billion in sales in Q2 2024. However, sales only increased by 1% from the same quarter last year. This is a slower growth rate than from Q1 of this year, when Gardasil got a 14% sales boost from Q1 2023.

Chongqing Zhifei Biological Products Co., or Zhifei, specializes in producing and distributing medicines, particularly vaccines. Zhifei and Merck struck a deal back in 2012 to distribute Gardasil in China, with Zhifei contracting to buy specific amounts of the vaccine, Fierce Pharma reported. Zhifei inked another contract last year to distribute five of Merck’s vaccines, including Gardasil, until 2026, in a deal worth over $14 billion, according to Yicai Global.

Merck CEO Robert Davis said on the earnings call that based on the intelligence that the company gathered, Gardasil’s sales have been affected by China’s anti-bribery and anti-corruption drive. Last year, China started a wide-scale anti-corruption campaign targeting hospitals, the pharmaceutical industry and insurance companies, according to CNN. Davis said Merck had not seen much impact from the drive at first, but “we believe we are starting to see it now.”

“And this is really driven by the fact that in the healthcare industry, there has been, as a result of this, a reduction in scientific engagement, primarily in the CDC within China, and fewer immunizations,” Davis continued.

He added that Merck plans to work closely with Zhifei to understand what caused the company to distribute less vaccine. Merck also plans to assess future shipments to Zhifei and work to bring “their inventory back to more normal levels,” he said.

However, Seigerman noted that the exact nature of the anti-corruption drive is still unclear, and it will be difficult to forecast its ultimate impact. “If anyone said they know exactly what the Chinese government is going to do, they’re not being truthful because it’s very hard to predict, and I think this is even harder to predict,” he said. “Vaccination campaigns are driven by public health, which is driven by the government.”

China’s Importance

China is a crucial market for Merck and Gardasil. Divan noted that the international market as a whole has been a massive growth opportunity for Gardasil and that China accounts for 67% of its total international sales, to the tune of about $4 billion to $4.5 billion per year.

Seigerman estimates that Gardasil will reach peak sales worldwide of $11 billion, though he noted that this estimate could change considering the vaccine’s concentration in the Chinese market. He added that if the distribution issue in China is just an anomaly, the estimate still stands.

Divan said that experts need clarity on the situation, whether the news is good or bad, to remove the uncertainty investors feel at the moment. “We like confidence being exuded by [a company’s] management team,” Seigerman said. “If management’s not confident, I’m not going to be confident.”

https://www.biospace.com/business/gardasil-chinese-distribution-issue-still-a-mystery-to-analysts