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Friday, May 2, 2025

Cigna raises 2025 outlook after lower-than-expected cost trends

 Shares of The Cigna Group (NYSE:CI) traded higher in the premarket on Friday after the managed care firm raised its full-year earnings outlook following a consensus-beating Q1 2025 report, which indicated better-than-expected medical cost trends.

During the quarter, the company’s top line grew ~14% YoY to $65.5B, beating the Street forecasts by as much as $5.1B, as its Cigna Healthcare division, which houses its health insurance business, expanded ~9% YoY in adjusted terms, generating $14.5B in revenue.

Meanwhile, Evernorth Health Services division, which operates CI’s pharmacy benefit manager Express Scripts, added $53.7B in adjusted revenue with ~16% YoY growth driven by ~14% YoY and ~19% YoY growth in its Pharmacy Benefit Services and Specialty & Care Services, respectively.

As for the medical care ratio, an industry benchmark indicating the portion of premium revenue spent on medical care, Cigna (NYSE:CI) recorded 82.2% for its healthcare division, falling short of the 82.4% projected by analysts, according to Bloomberg data.

While CI’s MCR for Q1 indicated a rise from 79.9% in the prior year period mainly due to the anticipated higher stop-loss medical costs, the company’s adj. income from operations rose ~4% YoY to $6.74 per share, exceeding the analysts’ estimates by $0.39.

Looking ahead, Cigna (NYSE:CI) reaffirmed its full-year outlook for the medical care ratio at 83.2% - 84.2% but raised the guidance for adj. income from operations by $0.10 per share to at least $29.60 in line with the consensus.  

https://www.msn.com/en-us/money/markets/cigna-raises-2025-outlook-after-lower-than-expected-cost-trends/ar-AA1E2H6p

AstraZeneca’s asthma therapy shows promise in trials

 Astrazeneca's BREZTRI AEROSPHERE met all primary endpoints in the Phase III KALOS and LOGOS trials for uncontrolled asthma, suggesting a significant improvement in lung function over dual-combination therapies. These results could potentially change the standard of care for asthma patients who remain uncontrolled despite current treatments.

The KALOS and LOGOS trials were designed to test the efficacy and safety of BREZTRI, which combines budesonide, glycopyrronium, and formoterol fumarate, in comparison with inhaled corticosteroid/long-acting beta2-agonist (ICS/LABA) medications. The study included approximately 4,400 patients, with results indicating an improvement in lung function as measured by forced expiratory volume in one second (FEV1). 

https://www.investing.com/news/company-news/astrazenecas-asthma-therapy-shows-promise-in-trials-93CH-4019490

Trump closes tariff loophole on cheap online goods from China

 President Donald Trump has today closed a tariff loophole that companies like Chinese e-commerce giants Shein and Temu have been using to sell cheap goods into the U.S. tariff-free – which will likely impact prices on U.S. consumers.

Trump has eliminated what’s known as the "de minimis" exemption where imports valued under $800 from China and Hong Kong were not subject to tariffs or required to undergo rigorous customs checks. The loophole has also been criticized for allowing shipments of fentanyl precursors to enter the country.

The change comes into effect one month after Trump signed an executive order to end the loophole which has been in place since 1938. The goods now face up to 145% tax rate or are subject to a flat fee which will likely be passed on to the consumer. 

Shein and Temu

President Donald Trump has today closed a tariff loophole that companies like Chinese e-commerce giants Shein and Temu have been using to sell cheap goods into the U.S. tariff free – which will likely impact prices on U.S. consumers. (Davide Bonaldo/SOPA Images/LightRocket via Getty Images // Jakub Porzycki/NurPhoto / Fox News)

Nearly half (48%) of de minimis shipments from sites like Shein and Temu go to the poorest U.S. zip codes, while only 22% reach the wealthiest, according to research by UCLA and Yale economists.

The executive order said it was a "critical step in countering the ongoing health emergency posed by the illicit flow of synthetic opioids into the U.S."

The White House said that many Chinese-based shippers hide illicit substances, including synthetic opioids, in low-value packages to exploit the de minimis exemption. Figures from the Centers for Disease Control and Prevention (CDC) estimate a staggering 107,543 drug overdose deaths in the U.S. during 2023.

Prior to the closing of the loophole, Customs and Border Patrol (CBP) processed over 4 million de minimis shipments into the U.S. each day, the White House said. Last fiscal year, CBP apprehended more than 21,000 pounds of fentanyl at our borders, enough fentanyl to kill more than 4 billion people. 

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Trump tariffs

Trump has eliminated what’s known as the "de minimis" exemption where imports valued under $800 from China and Hong Kong were not subject to tariffs or required to undergo rigorous customs checks. The loophole has also been criticized for allowing sh (Image  of Trump: Photo by MANDEL NGAN/AFP via Getty Images, Image of Houston: Photo by Brandon Bell/Getty Images)

An investigation by Reuters reporters last year found that they were able to use the de minimis loophole to import the main precursor chemicals for at least 3 million fentanyl tablets due to overseas shippers intentionally mislabeling the packages as electronics.

Fast-fashion giant Shein sought to reassure customers in a post on its U.S. Instagram account on Thursday, saying: "Some products may be priced differently than before, but the majority of our collections remain as affordable as ever." Shein sells clothes mostly manufactured in China, and the U.S. is its biggest market.

Temu, the international arm of Chinese e-commerce giant PDD Holdings, prominently featured products already in U.S. warehouses on its website, labelled "Local," and a pop-up informed customers there would be no import charges for local warehouse items.

"All sales in the U.S. are now handled by locally-based sellers, with orders fulfilled from within the country," Temu said in a statement, adding that it's pricing for U.S. customers "remains unchanged."

But items imported before the May 2 change will eventually run out. Both Shein and Temu have slashed their U.S. digital advertising spending in the past weeks as they prepared for the change that is likely to hit their sales.

Shein factory

Workers make clothes at a garment factory that supplies SHEIN, a cross-border fast fashion e-commerce company in Guangzhou, in Chinas southern Guangdong province on July 18, 2022.  (JADE GAO/AFP via Getty Images / Getty Images)

Shein and Temu have seen rapid growth in the U.S. market through de minimis shipments of fast fashion, toys and other consumer goods to cost-conscious consumers. A report by the Congressional Research Service (CRS) noted that Shein and Temu combined to comprise about 17% of the U.S. discount market as of November 2023.

The rise of Shein and Temu has contributed to an increase in U.S. retail store closures, according to a report by Coresight Research. It estimated that about 15,000 closures will occur in 2025 after there were 7,323 closures in 2024 – which was the highest number of closures since 2020, when nearly 10,000 stores shut down.

Some experts believe the closure of the loophole will help U.S. manufacturers become more competitive against the e-giants.  

Kim Glas, the president of the National Council of Textile Organizations, which represents American textile makers, said it had "devastated the U.S. textile industry."

"This tariff loophole has granted China almost unilateral, privileged access to the U.S. market at the expense of American manufacturers and U.S. jobs," Glas told the New York Times. Her group had advocated for its abolition. 

https://www.foxbusiness.com/politics/trump-closes-tariff-loophole-cheap-online-goods-from-china

"Out In 60 Days": US Firm Plans "Accelerated" China Exit

 President Trump's trade war is pushing both multinational giants and small businesses to either friend-shore or re-shore their critical supply chains out of China. Some of these firms have even considered bringing critical manufacturing operations to the United States. 

One such company, Seattle, Washington-based Wyze Labs, a popular seller on Amazon of smart home and wireless camera products, revealed on X that their "first tariff bill" has "accelerated" efforts to leave China in two months, with serious consideration of restoring supply chains in the United States

"Just got our first tariff bill. We imported $167k of floodlights and then paid $255k in tariffs. That's more than any of our founders were paid last year," Wyze wrote on X. 

"We've been working on moving manufacturing out of China for over a year now, but those efforts have been…accelerated. We'll probably be out in 60 days," the Seattle start-up said, adding, "Obviously we'd love to move our factories back home to Seattle. We just need to figure out to make the rain in Seattle power an assembly line." 

Some of Wyze's products on Amazon have tens of thousands of reviews, making them a popular choice among consumers. 

Earlier on Thursday, Eli Lilly CEO Dave Ricks provided CNBC with an update about tariffs: "I think that actually, the threat of tariffs is already bringing back critical supply chains into important industries, chips, and pharma."

Perhaps the Trump administration should consider launching a public counter to track the success of friend-shoring and re-shoring efforts, as the 145% tariff on Chinese imports acts as a powerful lever in the ongoing trade war, reshaping critical supply chains and accelerating the exodus from China.

https://www.zerohedge.com/geopolitical/out-60-days-us-firm-plans-china-exit-accelerated

Thursday, May 1, 2025

Trump terminates NPR, PBS federal funding

 President Trump signed an executive order late Thursday night terminating federal funding for National Public Radio (NPR) and the Public Broadcasting Service (PBS).

President Donald Trump speaks in the Cross Hall of the White House during an event on “Investing in America” on April 30, 2025 in Washington, DC.Getty Images

NPR and PBS, which have long been targeted for cuts by conservatives, both receive partial funding through the Corporation for Public Broadcasting (CPB), which the president argued is unnecessary in the current media environment.

“Government funding of news media in this environment is not only outdated and unnecessary but corrosive to the appearance of journalistic independence,” Trump wrote in the order.

The Public Broadcasting Service (PBS) logo is displayed on a smartphone screen.Rafael Henrique – stock.adobe.com
Trump signed an executive order late Thursday night terminating federal funding for National Public Radio (NPR) and the Public Broadcasting Service (PBS).Timon – stock.adobe.com
“The CPB Board shall cease direct funding to NPR and PBS, consistent with my Administration’s policy to ensure that Federal funding does not support biased and partisan news coverage,” he added. “The CPB Board shall cancel existing direct funding to the maximum extent allowed by law and shall decline to provide future funding.”

https://nypost.com/2025/05/01/us-news/trump-terminates-npr-pbs-federal-funding-with-sweeping-executive-order/

Trump to Propose Slashing $163 Billion in Government Programs in Budget Blueprint

 President Trump is expected to propose far-reaching cuts to federal environmental, renewable energy, education and foreign-aid programs in a budget blueprint that slashes nondefense discretionary spending by more than $160 billion, according to administration officials.

The fiscal 2026 budget proposal, which the White House is planning to release on Friday, is a largely symbolic wish list that lays out the president’s spending and political priorities. Congress, which Republicans control by narrow majorities in both chambers, will spend months debating which elements of the proposed plan should be turned into law.

The budget plan will propose $557 billion in nondefense discretionary spending, officials said. It would reduce nondefense discretionary spending by $163 billion, the officials said. The administration said that represents a 22.6% cut from projected spending in fiscal 2025, which ends Sept. 30. It wasn’t clear how the administration calculated that percentage.

Nondefense discretionary spending represents the portion of federal money that must be reauthorized each year and includes funding for areas such as education, transportation and public health. It doesn’t include Medicare, Medicaid and Social Security, or spending on defense.

Trump’s budget proposal would also increase funding for border security and defense, officials said, as well as air and rail safety, veterans and law enforcement.

The president’s proposal builds on Trump’s existing efforts to eliminate diversity, equity and inclusion initiatives, roll back Biden administration clean-energy goals and target programs, grants, and research funding the administration asserts contribute to waste or promote a political agenda.

Since taking office in January, the administration—led by billionaire Elon Musk’s Department of Government Efficiency—has taken early steps to dismantle federal agencies and fire government workers.

Budget documents viewed by The Wall Street Journal show that the White House is proposing deep cuts to programs at the Environmental Protection Agency, the Energy Department, the Interior Department, the Department of Housing and Urban Development, the Education Department, the National Institutes of Health, and the National Oceanic and Atmospheric Administration, among others.

Much of what the federal government spends every year is mandated by previous pieces of legislation and the U.S. government’s obligations to its creditors, which have grown as the federal debt has ballooned.

Trump’s proposal is known in Washington as a “skinny budget,” which is typically submitted in the first year of a president’s term. It lays out top line funding requests, but isn’t as comprehensive as the full budget that the administration is expected to release later this month. The president is expected to send the budget outline to Capitol Hill on Friday.

Musk has estimated that DOGE would cut $150 billion in spending in the coming fiscal year, which begins Oct. 1. Musk has pledged to find $1 trillion in total savings.

Trump’s budget is expected to target programs the administration views as “wasteful,” according to administration officials, who said it would encourage states to take back ownership of some programs, eliminate what the Trump administration sees as “woke” initiatives and reduce funding for climate and green energy programs.

An administration official familiar with the budget said it would eliminate many federal grants put in place during the Biden administration and require more financial participation from localities and states. The budget proposal would also eliminate some federal block grants or consolidate them to reduce administrative costs.

The budget is expected to propose expansive cuts to foreign assistance. Trump already dismantled the U.S. Agency for International Development, or USAID, and what little remains is being moved to the State Department. The budget also calls for eliminating some of the agencies already targeted by Trump executive orders.

According to administration officials, Trump’s proposed budget cuts include:

Eliminating offices at the Cybersecurity and Infrastructure AgencyDefunding “environmental justice” initiatives at the EPAClosing USAID and reallocating grant fundingEliminating a federal program that provides grants to nonprofits that help people who face housing discriminationDefunding the National Endowment for Democracy, a nonprofit that supports democratic institutions around the worldCutting what it calls “wasteful and woke FEMA grant programs”Closing the U.S. Institute of Peace, a congressionally funded think tank that seeks to prevent global conflictRefocusing the National Institutes of Health on research that aligns with Trump’s “Make America Healthy Again” agendaEliminating a $315 million grant program for preschool development that the administration contends pushed DEI initiativesCutting $77 million in grant funding for teacher preparation and professional development the administration says pushed “Critical Race Theory” and DEI initiativesEliminating the Minority Business Development Agency, which promotes minority-owned businessesEliminating the Community Development Financial Institutions Fund, which promotes economic growth in poor communitiesCutting $5.2 billion from the National Science FoundationCanceling $15 billion in funding in the infrastructure law signed by former President Joe Biden for renewable energy technologyEliminating U.S. investments in global funds to help developing countries deal with the effects of climate changeEliminating EPA research grants to nongovernmental organizationsCutting $2.5 billion from the Energy Department’s renewable energy programCutting $80 million from renewable energy programs at the Interior DepartmentEliminating grants at NOAA, which forecasts weather and monitors oceanic and atmospheric conditions, among other things

https://www.msn.com/en-us/news/politics/trump-to-propose-slashing-163-billion-in-government-programs-in-budget-blueprint/ar-AA1E0Yko

Neurocrine Initiates Phase 3 for Potential Treatment for Schizophrenia

  Neurocrine Biosciences, Inc. (Nasdaq: NBIX) today announced the initiation of a Phase 3 registrational program to evaluate the efficacy, safety and tolerability of NBI-1117568, the company's investigational oral muscarinic M4 selective orthosteric agonist, as a potential treatment for schizophrenia. Positive top-line data for the Phase 2 clinical study in adults with schizophrenia were reported in August 2024.

The Phase 3 study is a global double-blind, placebo-controlled trial evaluating NBI-1117568 in adults with a primary diagnosis of schizophrenia who are experiencing an acute exacerbation or relapse of symptoms. The study is expected to enroll approximately 280 patients. The primary endpoint of the study is a reduction from baseline in the Positive and Negative Syndrome Scale (PANSS). The key secondary endpoint is improvement in the Clinical Global Impression of Severity (CGI-S) scale.

https://neurocrine.gcs-web.com/news-releases/news-release-details/neurocrine-biosciences-initiates-phase-3-registrational-program