'Worse Than COVID': Weak US Manufacturing Surveys Signal Stagflation In November

 This morning's survey data on the US manufacturing economy comes as the post-shutdown slump in 'soft' data has dominated desk conversations amid the vacuum of hard macro data...

But the picture remains mixed:

• S&P Global's US Manufacturing PMI BEAT expectations in November but dipped on a MoM basis from 52.5 to 52.2 (still in expansion territory and up from the 51.9 flash print).

• ISM's Manufacturing PMI MISSED expectations, dropping from 48.7 to 48.2 (well below the 49.0 expectation) and in contraction for the ninth month in a row.

Although the headline PMI signalled a further expansion of factory activity in November, "the health of the US manufacturing sector gets more worrying the more you scratch under the surface," according to Chris Williamson, Chief Business Economist at S&P Global Market Intelligence.

"The main impetus came from a strong rise in factory production, but growth in new order inflows slowed sharply, hinting at a marked weakening of demand growth."

Under the hood, ISM shows Price Paid higher, and new orders and employment worsening...

For two successive months now, warehouses have filled with unsold stock to a degree not previously seen since comparable data were available in 2007. This unplanned accumulation of stock is usually a precursor to reduced production in the coming months.

“Profit margins are meanwhile coming under pressure from a combination of disappointing sales, stiff competition and rising input costs, the latter widely linked to tariffs.

In short, Williamson notes that manufacturers are making more goods but often not finding buyers for these products. 

"This combination of sustained robust production growth alongside weaker than expected sales led to a worryingly steep rise in unsold inventories."

ISM Respondents were pretty clear with blame for weakness being placed at Trump's feet in Washington:

• “New order entries are within the forecast. We have increased requests from customers to get their orders sooner. Transit time on imports seems to be longer.” (Machinery)

• “We are starting to institute more permanent changes due to the tariff environment. This includes reduction of staff, new guidance to shareholders, and development of additional offshore manufacturing that would have otherwise been for U.S. export.” (Transportation Equipment)

• “Tariffs and economic uncertainty continue to weigh on demand for adhesives and sealants, which are primarily used in building construction.” (Chemical Products)

• “No major changes at this time, but going into 2026, we expect to see big changes with cash flow and employee head count. The company has sold off a big part of the business that generated free cash while offering voluntary severance packages to anyone.” (Petroleum & Coal Products)

• “Business conditions remain soft as a result of higher costs from tariffs, the government shutdown, and increased global uncertainty.” (Miscellaneous Manufacturing)

• “The unstable market has made pricing fluctuate in a very volatile way; I have had to reduce suppliers for raw materials to maintain a better direct cost structure. Reducing my suppliers has reduced the availability of some items and created longer lead times.” (Fabricated Metal Products)

• “Business continues to be a struggle regarding long-term sourcing decisions based on tariffs and landing costs. External (or international) sourcing remains the lowest-cost solution compared to U.S. production/manufacturing. The delta is smaller now, reducing margins.” (Computer & Electronic Products)

• “The government shutdown has impacted our access to agricultural data, impacting agricultural markets and, as a result, decisions we make. Optimism for a tariff exemption on palm oil percolated but hasn’t come to fruition at this time.” (Food, Beverage & Tobacco Products)

• “Trade confusion. At any given point, trade with our international partners is clouded and difficult. Suppliers are finding more and more errors when attempting to export to the U.S. — before I even have the opportunity to import. Freight organizations are also having difficulties overseas, contending with changing regulations and uncertainty. Conditions are more trying than during the coronavirus pandemic in terms of supply chain uncertainty.” (Electrical Equipment, Appliances & Components)

• “Domestic and export business have been lackluster. Our customers are taking prompt orders only and still don’t have confidence to build inventory, much less make expansion plans. In fact, most of any kind of ‘planning’ has been undermined by unpredictability due to inconsistent messaging from Washington. Artificial intelligence is in its infancy stages, producing confusing and most often inaccurate information. This also causes apprehensive consumer buying patterns, contributing to the challenge of forecasting demand.” (Wood Products)

However, there is hope, as manufacturers have grown more optimistic about the year ahead, with the ending of the government shutdown helping lift confidence from the sharp drop suffered in October.

"Optimism is being fueled by hopes of improved policy support, including lower interest rates, as well as greater political stability, though it is clear that uncertainty remains elevated and a drag on business growth in many firms, holding confidence well below levels seen at the start of the year.”

https://www.zerohedge.com/economics/stagflation-fears-re-emerge-us-manufacturing-surveys-show-weakness-continued-november

'Inside NYT's Hoax Factory': Trump's AI/Crypto Czar Dismisses Hit-Piece As 'Nothing Burger'

 by Jesse Coghlan via CoinTelegraph.com,

White House AI and crypto czar David Sacks has fired back at The New York Times over a report detailing how his government advisory role could benefit his investments and those of his close associates.

Sacks said in a post to X that despite having “debunked in detail” the Times’ reporting over the past five months, the outlet continued to publish the article on Sunday about his supposed conflicts of interest.

“Today they evidently just threw up their hands and published this nothing burger,” Sacks wrote. “Anyone who reads the story carefully can see that they strung together a bunch of anecdotes that don’t support the headline.”

Sacks is a co-founder and partner at the venture firm Craft Ventures, and his special government employee role at the White House has drawn scrutiny in the past, with Democrat Senator Elizabeth Warren saying in May that he is “financially invested in the crypto industry, positioning him to potentially profit from the crypto policy changes he makes at the White House.”

Source: David Sacks

Before he became crypto czar, Sacks and Craft divested over $200 million in crypto and crypto-tied stocks, at least $85 million of which Sacks owned, but Sacks retained an interest in several illiquid investments of “private equity of digital asset-related companies.”

Sacks retains 20 crypto investments, The Times reports

The Times reported that its analysis of Sacks’ financial disclosure found he has retained 708 tech investments, 449 of which are AI-related and 20 are tied to crypto, all of which could benefit from the policies Sacks supports.

In one example of a perceived conflict in Sacks’ role, the outlet stated that Craft Ventures is invested in the crypto infrastructure company BitGo, which offers a stablecoin-as-a-service.

BitGo filed to go public in September, with regulatory filings showing Craft owned 7.8% of the company.

The Times noted that Sacks was a major backer of the stablecoin-regulating GENIUS Act, which was signed into law earlier this year. Many crypto commentators predicted that this would boost the use and adoption of the tokens by institutions.

Other examples noted by the Times involved Sacks’ and Craft’s ties to companies involved with AI, which have skyrocketed in value as the White House and Wall Street bet on the technology’s potential.

The Times noted that Sacks’ ethics waivers, shared in March, stated he would sell his interests in AI and crypto; however, they don’t disclose when he sold the assets and do not detail the value of his remaining investments.

NYT created “bogus narrative,” says Sacks

In his X post, Sacks shared a letter to the Times sent by his lawyers at Clare Locke accusing the outlet of setting out “to write a hit piece” and giving their reporters “clear marching orders” to find conflicts of interest.

Sacks added it was “very clear how NYT willfully mischaracterized or ignored the facts to support their bogus narrative.”

Sacks’ spokesperson Jessica Hoffman told the Times that he has complied with rules for special government employees, and the Office of Government Ethics said that Sacks should sell his investments in certain types of companies but not others.

Sacks’ role as a special government employee is limited to 130 days, and in September, Democratic lawmakers questioned whether he had exceeded the number of days allowed with his appointment.

However, Sacks reportedly carefully manages the days he spends as a special government employee to ensure that he stays under the limit.

https://www.zerohedge.com/crypto/inside-nyts-hoax-factory-trumps-aicrypto-czar-dismisses-hit-piece-nothing-burger

Belite continues ascent as Stargardt drug hits mark in late-stage trial

 

• An experimental drug from Belite Bio succeeded in a Phase 3 trial in the most common form of Stargardt disease, positioning the company to seek regulatory approval next year of what could be the first marketed medicine for the condition.
• According to Belite, treatment with its drug, known as tinlarebant, was associated with a roughly 36% reduction in the growth rate of retinal lesions compared to a placebo over the course of two years, meeting the trial’s main goal. Both study groups had a minimal overall change in visual acuity, but Belite said that finding was “consistent” with historical data.
• Belite said tinlarebant was “well tolerated,” with only four patients stopping treatment due to adverse events. The most common eye side effects related to treatment were a type of color vision deficiency and issues seeing at night or adjusting to a dark environment. The majority of those cases were mild, and most resolved during the trial, the company said.

Though it raised only $36 million in an initial public offering three years ago, Belite has quietly been one of the biopharmaceutical sector’s top performers ever since, according to BioPharma Dive data. Company shares, which debuted at $6 apiece, opened Monday trading at nearly $140. Belite is currently valued at around $5 billion.

The reason is tinlarebant, an oral drug with the chance to become the first marketed medicine for Stargardt. In Stargardt, a genetic defect changes how the body processes the vitamin A used to make retinal cells. That defect causes yellowish clumps to form in the eyes, destroying cells and triggering progressive vision loss. There are no available treatments for the roughly 50,000 people in the U.S. Belite estimates to have the disease.

Tinlarebant is designed to reduce the accumulation of toxic vitamin A byproducts in the eye. The drug was first studied at Columbia University over a decade ago, and then put up for bid in a National Institutes of Health program in 2016. Belite’s CEO and chairman, Tom Lin, licensed it and formed Belite around the program two years later. Belite has since brought tinlarebant into late-stage testing in Stargardt as well as geographic atrophy, a more common type of vision loss.

Belite’s value had already doubled this year in anticipation of the results in Stargardt. The company also received a positive recommendation from trial monitors that the 104-patient study continue without modifications, and noted that China’s drugs regulator had begun reviewing an application based on interim results showing statistical significance on the study’s main measure. The likelihood of success was “fairly high” given those updates, Leerink Partners analyst Marc Goodman wrote last month. Goodman has forecast anywhere from $1.4 billion to $3.6 billion in peak annual sales, depending on the drug’s price.

With the positive results, Belite intends to discuss an approval application with regulatory authorities in the U.S. and elsewhere in first half of 2026. It could face competition soon, however. Alkeus Pharmaceuticals, a privately held company, is preparing a submission for a new drug that’s similarly designed to reduce the buildup of harmful vitamin A byproducts in the eye. Ocugen, AAVantgarde, Splice Bio and others are advancing genetic medicines for the condition, too.

Stargardt experts believe gene therapy will eventually “be the preferred treatment approach” for the condition, wrote Mizuho Securities’ Graig Suvannavejh. But for now, the lack of other available therapies should mean “enthusiastic market uptake” for a drug proven to slow disease progression, he wrote in November.

Belite shares climbed by double digits before reversing course and dipping a few percentage points early Monday.

https://www.biopharmadive.com/news/belite-stargardt-tinlarebant-dragon-study-results/806622/

Akebia to pay $12M to Q32 Bio for centerpiece of rare kidney disease pipeline

 Akebia Therapeutics has struck a deal for Q32 Bio’s deprioritized complement inhibitor ADX-097, paying $7 million upfront for an asset that forms the centerpiece of its new rare kidney disease pipeline. 

Q32 hung a for-sale sign on ADX-097 in February. Needing cash for an alopecia areata trial, the biotech stopped a phase 2 renal basket clinical trial of the drug candidate and began evaluating strategic options for its tissue-targeted complement inhibitor platform. In Akebia, Q32 has found a buyer for its C3d-Factor H fusion protein complement inhibitor ADX-097.

Akebia is paying $7 million upfront and guaranteeing another $5 million to buy ADX-097. Q32 will receive $3 million six months after the deal closes and the final $2 million slice of the guaranteed payments by the end of next year.

The deal features $580 million in milestones, most of which are tied to sales of ADX-097. Akebia is on the hook for up to $92.5 million related to development and regulatory milestones. The remaining $487.5 million in potential paydays for Q32 are related to commercial milestones.

Akebia framed the deal as part of its construction of a rare kidney disease pipeline, which is happening in the aftermath of a setback to its approved drug Vafseo. The biotech plans to run a phase 2 basket trial to evaluate the complement inhibitor in multiple rare kidney disease indications. Akebia aims to start the study next year.

The trial is one of two Akebia rare kidney disease studies that could start dosing patients next year. The other study is a phase 2 trial of praliciguat in focal segmental glomerulosclerosis. Akebia licensed the sGC stimulator from Cyclerion Therapeutics in 2021. Preparations to make praliciguat for use in clinical trials took longer than expected, but Akebia now has FDA clearance to run a phase 2 study. 

For Q32, the deal provides a cash boost to fund development of bempikibart in alopecia areata. While bempikibart failed a phase 2b eczema study, Q32 has cut back in other areas to advance the anti-IL-7R antibody in alopecia. The sale of ADX-097 will extend Q32’s cash runway into the second half of 2027, compared to the second half of 2026 without the deal. Phase 2 alopecia data are due in mid-2026.  

With Akebia only buying ADX-097, Q32 is continuing to evaluate options for the rest of its tissue-targeted complement inhibitor platform. The remaining assets include ADX-096, a C3d mAb—CR1 fusion protein that has undergone preclinical tests in eye indications. 

https://www.fiercebiotech.com/biotech/akebia-pays-12m-complement-q32-bio-centerpiece-rare-kidney-disease-pipeline

Roche shares hit milestone with 19% November surge on breast cancer, promising MS drug trials

 Shares of Swiss pharmaceutical giant Roche (OTCQX:RHHBY) saw their strongest monthly gain since 1997 in November, fueled by optimism around an experimental breast cancer drug and positive trial results.

The stock gained 19% last month after Roche said its giredestrant medicine helped women with a form of early breast cancer. Additionally, news of two late-stage trials showed that a multiple sclerosis drug could work for most forms of the disease.

As such, Seeking Alpha investing group leader Edmund Ingham upgraded Roche to Buy, citing strong 2025 performance, a robust pipeline, and attractive valuation metrics.

While RHHBY faces major patent expirations, new launches like Phesgo, Helimbra, and Vabysmo, plus a deep pipeline, can offset losses, Ingham added.

He further noted that Roche's obesity assets, for example, could drum up billions, or potentially even tens of billions, of revenues in the 2030s - provided they are approved with a similar safety and efficacy profile to Novo Nordisk's (NVO) semaglutide and Eli Lilly's (LLY) tirzepatide - better known as Ozempic / Wegovy and Zepbound / Mounjaro.

Furthermore, the company has lifted its full-year guidance for per-share core earnings growth to a high single- to low double-digit range from the prior outlook of a high single-digit rise in currency-adjusted terms. However, the company reiterated its annual sales forecast, implying mid-single-digit growth.

YTD, the stock is up 37%.

https://www.msn.com/en-us/money/markets/roche-shares-hit-milestone-with-19-november-surge-on-breast-cancer-and-promising-ms-drug-trials/ar-AA1RtkvB

UnitedHealth to exit Latin America with $1B Banmedica sale

 The sale marks the conclusion of UnitedHealth’s planned exit from Latin America, a process that began in 2022 and previously included divestments in Brazil and Peru.

・The company recorded an $8.3 billion loss in full-year 2024, tied to its South American divestments, including $7.1 billion from its exit in Brazil.

UnitedHealth Group (UNH) has agreed to sell its last remaining South American asset, Banmedica, to Brazilian private equity firm Patria Investments for about $1 billion, Reuters reported on Sunday. The final agreement was signed on Saturday, with an official announcement expected on Monday.

Talks over the sale of Banmedica began nearly a year ago. The sale marks the conclusion of UnitedHealth’s planned exit from Latin America, a process that began in 2022 and previously included divestments in Brazil and Peru. UnitedHealth had acquired the Chilean company for $2.8 billion in 2018.

The company recorded a $8.3 billion loss in full-year 2024, tied to its South American divestments, including $7.1 billion from its exit from Brazil.

Banmedica, which operates in Colombia and Chile, serves 1.7 million insurance members and operates seven hospitals and 47 medical centers.

The move reportedly allows the company to stabilize following a turbulent period marked by rising medical costs, a federal investigation, and the murder of former CEO Brian Thompson in December 2024.

CEO Stephen Hemsley, who previously held the role from 2006 to 2017, was reinstated amid a broader management overhaul after the company posted its first earnings miss in more than a decade in April.

Earnings Outlook

In October, the insurer lifted its 2025 earnings forecast, projecting net earnings of at least $14.90 per share and adjusted net earnings of $16.25 per share.

“We remain focused on strengthening performance and positioning for durable and accelerating growth in 2026 and beyond,” Hemsley said in a press release in October.

https://www.msn.com/en-us/money/news/unitedhealth-sells-last-south-american-asset-for-1-billion-report/ar-AA1RtYMd

Eli Lilly lowers starting dose costs for Zepbound on direct purchase platform

 Eli Lilly cut prices of its Zepbound drug single-dose vials on its direct-to-consumer platform after it lowered prices of its multi-dose pens last month.

The 2.5 milligram starting dose of Zepbound will now be available for $299 a month, down from $349. The 5 milligram dose will cost $399 a month, compared with its previous price of $499.

The 7.5 milligram, 10 milligram, 12.5 milligram and 15 milligram doses will all now cost $449, down from $499.

The lower prices are available for Eli Lilly's Zepbound Self-Pay Journey Program via its LillyDirect digital platform.

In November, the company made a deal with the U.S. government that included an agreement to lower prices of its Zepbound multi-dose pen.

https://www.morningstar.com/news/dow-jones/202512013225/eli-lilly-lowers-price-of-zepbound-single-dose-vials