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Follow this list to discover and track stocks that have been oversold as indicated by the RSI momentum indicator within the last week. A stock is oversold when the RSI is below 30. This list is generated daily, ranked based on market cap and limited to the top 30 stocks that meet the criteria.

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Bloomberg
Google Launches Stadia Gaming Service
Nov.19 -- Google's streaming game platform Stadia is now live. Access to games will start at just under $10 a month. Kenny Rosenblatt, Akradium president, appears on "Bloomberg Technology."
Bloomberg
Google Scoops Up Chunk of Vodafone in Battle With Microsoft and Amazon
Nov.19 -- Google is taking over a chunk of Vodafone Group Plc’s data operations to help make the phone company's operations more efficient. Google is vying with Amazon and Microsoft for dominance in the data center and cloud computing business. Bloomberg's Alistair Barr reports on "Bloomberg Technology."
Bloomberg
Google CEO Opens New Japan Campus in Tokyo’s Trendy Shibuya District
(Bloomberg) -- Google Chief Executive Officer Sundar Pichai was in Tokyo Tuesday to inaugurate the relocation of the company’s Japanese head office to an expansive new complex in the trendy district of Shibuya.Taking up the majority of the gleaming new 35-floor Shibuya Stream skyscraper, Google has put its name on the building and dedicated two floors to a newly launched Google for Startups Campus, which is its seventh in the world and second in Asia after Seoul.Agnieszka Hryniewicz-Bieniek, the director of Google for Startups, said that the company will run an accelerator program early next year that will select 12 startups looking to scale up their work on artificial intelligence and machine learning, both critical aspects of Google’s current and future operations. She also stressed the importance of inclusiveness at an event where the Wi-Fi password was BuildInclusiveTeams.“We would like Campus Tokyo to support women founders,” she said, and that Google is proud that 37% of its Campus participants are female entrepreneurs, a higher proportion than the wider startup ecosystem. “So when they go to the next stage of growth, we’re behind them, we’re supporting them.”The Campus initiative extends Google’s effort to combine education and training for startups with evangelism for the use of its cloud and business services. Co-location with Google’s main office will make it easy for experts from Google’s developer relations and web marketing teams to make themselves available to help budding entrepreneurs, Google said.Joined by Japan’s Minister for Internal Affairs and Communications Sanae Takaichi on stage, Pichai said he had toured some of the venues for next year’s Tokyo Olympics, which Google will be supporting through its various services like Google Maps and Translate. “Ultimately, we want to make sure the legacy of technology innovation extends far beyond 2020. This Google for Startups Campus is one part of that,” he said at the opening.AI has been topical in Japan recently, with SoftBank Group Corp. announcing plans to combine its Yahoo Japan internet business with Naver Corp.’s Line messaging service in an effort to create an AI tech leader capable of rivaling U.S. juggernauts like Google and Facebook Inc. On Monday, Peter Thiel visited Tokyo to introduce Palantir Technologies Japan Co., which will use AI to make sense of large volumes of unwieldy data in the fields of health and cybersecurity.Google has said the move to Shibuya Stream will double its employee headcount in Japan to beyond 2,000. The company’s first office outside the U.S. was in Tokyo, opening in 2001. It said it has “invested heavily” in Japan over the years and earlier in 2019 committed to training 10 million people in digital skills by 2022. Its so-called Grow with Google program is the Campus equivalent for individual job-seekers and students.“At Google, we are deeply committed to fostering Japanese startups,” Pichai said.(Updates with details of accelerator from second paragraph)To contact the reporter on this story: Vlad Savov in Tokyo at vsavov5@bloomberg.netTo contact the editors responsible for this story: Edwin Chan at echan273@bloomberg.net, Vlad Savov, Colum MurphyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Bloomberg
Fatal Self-Driving Uber Crash Prompts Call for Tighter Oversight
(Bloomberg) -- The National Transportation Safety Board concluded its first investigation of a fatal crash involving an autonomous test vehicle by issuing several recommendations aimed at tightening the limited oversight of companies that test self-driving cars on public roads.Among other things, the board called for developers of autonomous vehicles to be required to assess their safety procedures and not test cars on the road until regulators sign off on the document.“We feel that we’ve identified certain gaps and these gaps need to be filled, especially when we’re out testing vehicles on public roadways,” NTSB Chairman Robert Sumwalt said after a board meeting on the March 2018 crash involving an Uber Technologies Inc. self-driving test vehicle and a pedestrian.The case had been closely watched in the emerging autonomous vehicle industry, which has attracted billions of dollars in investment from companies such as General Motors Co. and Alphabet Inc. in an attempt to transform transportation.“Ultimately, it will be the public that accepts or rejects automated driving systems and the testing of such systems on public roads,” Sumwalt said. “Any company’s crash affects the public confidence. Anybody’s crash is everybody’s crash.”The NTSB detailed a litany of failings by Uber that contributed to the death of Elaine Herzberg, 49, who was hit by an Uber self-driving SUV as she walked her bicycle across a road at night in Tempe, Arizona.Uber halted self-driving car tests after the accident. Information released since then highlighted a series of lapses -- both technological and human -- that the board cited as having contributed to the crash.Uber resumed self-driving testing late last year in Pittsburgh.The “immediate cause” of the crash was the backup safety driver’s failure to monitor the road ahead because she was distracted by her mobile device, the board found. A lax safety program at Uber contributed to the accident, the NTSB found.The National Highway Traffic Safety Administration said it would review the NTSB’s report and recommendations. “While the technology is rapidly developing, it’s important for the public to note that all vehicles on the road today require a fully attentive operator at all times,” the agency said in a statement.In a statement, Uber said it regrets the fatal crash and is committed to improving the safety of its self-driving program, and implementing the NTSB’s recommendations. “Over the last 20 months, we have provided the NTSB with complete access to information about our technology and the developments we have made since the crash,” Nat Beuse, head of safety for Uber’s self-driving car operation, said in a statement. “While we are proud of our progress, we will never lose sight of what brought us here or our responsibility to continue raising the bar on safety.”The Uber vehicle’s radar sensors first observed Herzberg about 5.6 seconds prior to impact before she entered the vehicle’s lane of travel and initially classified her as a vehicle. The self-driving computers changed its classification of her as different types of objects several times and failed to predict that her path would cross the lane of self-driving test SUV, according to the NTSB.The modified Volvo SUV being tested by Uber wasn’t programmed to recognize and respond to pedestrians walking outside of marked crosswalks, nor did the system allow the vehicle to automatically brake before an imminent collision. The responsibility to avoid accidents fell to the lone safety driver monitoring the vehicle’s automation system. Other companies place a second human in the vehicle for added safety.The safety driver was streaming a television show on her phone in the moments before the crash, despite company policy prohibiting drivers from using mobile devices, according to police. The NTSB has also said that Uber’s Advanced Technologies Group that was testing self-driving cars on public streets in Tempe didn’t have a standalone safety division, a formal safety plan, standard operating procedures or a manager focused on preventing accidents.“The inappropriate actions of both the automatic driving system as implemented and the vehicle’s human operator were symptoms of a deeper problem, the ineffective safety culture that existed at the time,” Sumwalt said at the opening of the hearing.Uber made extensive changes to its self-driving system after several reviews of its operation and findings by NTSB investigators. The board pointed out that Uber had been very cooperative with its inquiry. The company told the NTSB that the new software would have been able to correctly identify Herzberg and triggered controlled braking to avoid her more than 4 seconds before the original impact, the NTSB has said.To contact the reporters on this story: Ryan Beene in Washington at rbeene@bloomberg.net;Alan Levin in Washington at alevin24@bloomberg.netTo contact the editors responsible for this story: Jon Morgan at jmorgan97@bloomberg.net, John Harney, Elizabeth WassermanFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Zacks
Walgreens Boots Alliance (WBA) Dips More Than Broader Markets: What You Should Know
In the latest trading session, Walgreens Boots Alliance (WBA) closed at $61.45, marking a -0.79% move from the previous day.
The Canadian Press
Most actively traded companies on the TSX
TORONTO — Some of the most active companies traded Tuesday on the Toronto Stock Exchange:Toronto Stock Exchange (17,011.40, down 13.71 points.)Aurora Cannabis Inc. (TSX:ACB). Health care. Up 11 cents, or 3.67 per cent, to $3.11 on 26.4 million shares.Enbridge Inc. (TSX:ENB). Energy. Down 32 cents, or 0.64 per cent, to $49.94 on 7.1 million shares.Manulife Financial Corp. (TSX:MFC). Financials. Up 12 cents, or 0.46 per cent, to $26.08 on 7 million shares.Encana Corp. (TSX:ECA). Energy. Down 24 cents, or 4.36 per cent, to $5.26 on 5.8 million shares.The Green Organic Dutchman Holdings. (TSX:TGOD). Health care. Up eight cents, or 12.31 per cent, to 73 cents on 5.7 million shares.Aphria Inc. (TSX:APHA). Health care. Up 65 cents, or 12.92 per cent, to $5.68 on 5.5 million shares. Companies in the news:Canadian National Railway. (TSX:CNR). Down $1.11 to $122.65. A growing number of industries are sounding the alarm over a strike by roughly 3,200 Canadian National Railway Co. workers, warning the work stoppage will dent revenues and could trigger layoffs and closures. The Teamsters Canada Rail Conference announced the strike Monday night after the two parties failed to reach a deal by the midnight deadline. Conductors, trainpersons and yard workers took to the picket lines Tuesday, halting freight trains across the country after CN confirmed last week it was cutting jobs as it deals with a weakening North American economy that has eroded demand. The work stoppage triggered worries among grain elevator operators and farmers — more than 90 per cent of grain is moved by rail — about lost sales and contract penalties.Encana Corp. (TSX:ECA).— A Canadian investment management firm with a four per cent stake in Calgary-based Encana Corp. says it will vote against Encana's plan to move its headquarters to the United States. Letko, Brosseau & Associates Inc. says the planned move to Denver would lead to Encana's removal from S&P/TSX stock indexes. That would mean investors holding Encana through indexed Canadian funds or with Canadian-only investment policies would have to sell Encana shares, a move the investor says would compound the 70 per cent decline in share price experienced since Sept. 30, 2018. Encana recently announced the headquarters move as part of a reorganization that would include changing its name to Ovintiv, as well as a share consolidation.George Weston Ltd. (TSX:WN). Up 60 cents to $105.08. The parent company of one of Canada's largest grocers outperformed analyst expectations as its third-quarter profit rose while the company works through its multi-year transformation plan. George Weston Ltd.'s third-quarter results are "a full baguette higher than forecast," wrote Irene Nattel, an RBC Dominion Securities Inc. analyst, in a note. The retail, bakery and real estate business announced Tuesday that its quarterly profit attributable to common shareholders for the 16 weeks ended Oct. 5 was $69 million or 44 cents per diluted share. That compared with a profit of $51 million attributable to common shareholders, or 40 cents per diluted share, in the same quarter last year.TC Energy Corp. (TSX:TRP). Up five cents to $67.98. TC Energy Corp. is looking at "optimizing" unaffected parts of its Keystone pipeline and will use drag reducing agents to ease volume losses following a spill in North Dakota, Paul Miller, vice-president of liquids pipelines, reported Tuesday. The pipeline was restarted at lower pressure and capacity last week after being offline for almost two weeks following a leak that spilled an estimated 1.4 million litres or 9,100 barrels of oil in a field near Edinburg, N.D. It's unknown when U.S. regulators will allow it to return to full pressure, said Miller, speaking at the energy transport and power company's investor day. He said it will take about two months for an independent lab to complete its analysis of the damaged section of pipe that was removed and replaced.This report by The Canadian Press was first published Nov. 19, 2019.The Canadian Press
Reuters
Google enters gaming with cloud-based streaming service Stadia
The service will start with a slate of 22 games and stream 4K videos at 60 frames per second, which can also be accessed through Google's Chromecast and Pixel devices. Google is offering the 4K version as part of its premium service, Stadia Pro, priced at $9.99 per month. "We have over 450 games in development right now that will be coming out in 2020 and beyond," Google Vice President and General Manager Phil Harrison told Reuters.
TEST Business Wire Releases
DD YAHOO Test video SBR 3K (11.19.19) English
The Big Test Corporation announced today that its net income for the first quarter of 2018 was a record $783 million, up 31% from $597 million for the prior quarter, and up 39% from $564 million for the first quarter of 2017.
Bloomberg
Conoco's 2020s Plan Is to Embrace the FUD
(Bloomberg Opinion) -- ConocoPhillips knows how to please a crowd, even one as shrunken and beaten-down as energy investors. By Tuesday lunchtime, as Conoco’s analyst day was wrapping up in Houston, it was the only big U.S. oil and gas stock flashing green, what with oil prices slipping almost 3%.This says a lot about why Conoco’s message resonates: It comes with a hefty dollop of FUD.“Fear, uncertainty, doubt” is what bears thrive on, but Conoco has refined it into something useful. CEO Ryan Lance set the tone with an opening slide called “Two Charts We Can’t Ignore,” showing how oil had dropped from its pre-2015 triple-digit level to the “new normal of lower, more volatile prices” and how the sector’s weighting in the S&P 500 had slumped from 12% in 2012 to today’s 4%. The subtitle of that slide could have been “but Lord knows the industry has tried to ignore them anyway,” which is how it ended up at that 4% weighting.Hence, Conoco continues to beat a different drum. The common thread running through Tuesday’s 152 slides is that oil and gas production is a mature business with a bad track record on capital management and a future clouded by climate change. There is no room for banking on higher commodity prices, and investors have given up paying for the oil option in E&P equities anyway.So forget exuberance and focus on resilience. Conoco’s message can be boiled down to cutting its breakeven cost per barrel and returning a lot of cash to shareholders. It plans on generating $12 billion a year of cash from operations, on average, through the 2020s, of which 60% goes to capital expenditure and 40% to buybacks and dividends. The latter equate to about 80% of the current market cap and are split themselves 60/40 in favor of buybacks, reflecting the reality of the cycle.Conoco bases its math on a $50 real oil price and expects production would grow by roughly a third over the next decade — or, factoring in the buybacks, significantly more than doubling on a per-share basis. Altogether, a projected average return made up of 8% free cash flow yield plus 3% growth is tailor-made for today’s energy investor, in contrast to the old, failed paradigm of a 10%-plus return owing everything to growth and nothing to payouts. Needless to say, Conoco was at pains to emphasize its cautious view on potential acquisitions, fear of which has weighed on the stock this year as fracker valuations have collapsed.None of this makes Conoco immune to oil’s vicissitudes, of course. Free cash flow tilts toward the back end of the decade, and the company would effectively borrow to fund some of its buybacks through 2025, at $50 oil. That said, having cut net debt by two-thirds since the end of 2016, Conoco doesn’t envisage leverage rising to even one times Ebitda in 2025. Under a stress-test scenario, where oil prices average $40 a barrel between 2023-25, the company doesn’t see leverage breaching two times Ebitda.Let’s just step back here in 2019 and acknowledge that, looking back at everything that’s unfolded in oil over the past decade, any 10-year projection should be treated less like a Google map and more like asking someone on the street for directions. Indeed, for me, the most important slide in Conoco’s deck looked back rather than forward(1). Here, COO Matt Fox talked through lessons learned from prior investment programs, chief of which is to stop committing the industry’s original sin: pro-cyclicality. In other words, don’t base your spending on how much spending power you have at any given moment. Rather, by targeting low breakeven costs, which factor in wherever the industry happens to be in the cycle, you smooth out investment and minimize spending when cost inflation is high and bringing on new production just as commodity prices turn down.This spend high/sell low approach pretty much sums up what the industry did over the past 10 years, vaporizing capital in the process. The chart below uses the U.S. onshore rig count as a proxy for industry capex, and you can see how it surged in the early years on the back of high oil prices, with much of the subsequent growth in production arriving after prices crashed. Even though frackers made real gains in efficiency in that time, the performance of the sector ETF tells you what this did to returns:This is especially important in the context of the new mantra being preached by many E&P companies today: namely, that they will live within their means. Conoco’s message is that just ensuring you don’t spend more than you make in a given year isn’t the cure for the sector’s ills. Rather, it’s about smoothing spending, production — and thereby payouts — over time in order to escape the boom and bust cycle. It is the latter that has eroded confidence in the industry’s earnings and, hence, led to lower and lower multiples being put on those earnings.Fear and doubt will always attach to oil prices, but companies can do something about uncertainty.(1) Slide 32 if you download the deck.To contact the author of this story: Liam Denning at ldenning1@bloomberg.netTo contact the editor responsible for this story: Mark Gongloff at mgongloff1@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Liam Denning is a Bloomberg Opinion columnist covering energy, mining and commodities. He previously was editor of the Wall Street Journal's Heard on the Street column and wrote for the Financial Times' Lex column. He was also an investment banker.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
The Motley Fool
3 Factors in Google’s Acquisition of Fitbit
Google's acquisition of Fitbit raised many eyebrows in the investing world, so we investigate whether the wearables manufacturer should be happy or not about it.
Reuters
Google, Facebook, Amazon and Apple offer defence in congressional antitrust probe
WASHINGTON/SAN FRANCISCO (Reuters) - Four top U.S. tech companies, Alphabet's Google, Facebook , Amazon.com and Apple , responded to questions from a congressional committee by defending their practices and declining to answer some questions. The House of Representatives Judiciary Committee, which released the answers Tuesday, had sent the queries as part of its antitrust probe of the four giants, which face a long list of other antitrust probes. Facebook and Apple declined comment for this story while Amazon and Google had no immediate comment.
Bloomberg
Google, Facebook, Amazon, Apple Push Back on House Tech Concerns
(Bloomberg) -- Google, Facebook, Amazon and Apple defended their business practices in responses to detailed questions by lawmakers conducting an inquiry into antitrust issues in the tech sector.The answers, released Tuesday by the House subcommittee overseeing the probe, come as antitrust scrutiny of the companies has escalated rapidly, with federal and state enforcers opening formal investigations into Facebook Inc. and Alphabet Inc.’s Google.The four companies received the questions from Democratic Representative David Cicilline of Rhode Island, who chairs the panel, in September. Separately, the whole committee issued requests for extensive records on the firms’ business practices, acquisitions, executive communications and other issues. The companies also are in the process of responding to those requests.Here’s what the four firms said:GoogleDisputed the idea that it controls too much of the search market and the digital ad ecosystem.Downplayed suggestions that it prioritizes its own services.Denied that advertisers can only use Google Display & Video 360 ad service to purchase advertising inventory on its YouTube video platform, saying certain partners can buy ads directly from Google’s sales team.Denied that its search ranking system considers whether a publisher has adopted use of its Accelerated Mobile Pages -- a format that hosts web content directly inside search results. Google has said that the new format significantly accelerated loading times on websites.FacebookDefended policies that restricted some third-party app developers from using its platform, insisting it has never tied access to its data to spending on advertising even though documents from a lawsuit have told a different story.Said its changes to WhatsApp’s privacy policy were consistent with its promises not to alter the chat platform’s sharing practices.Explained that it restricted video app Vine from its platform in 2013 because it “considered Vine to be an app that replicated Facebook’s core News Feed functionality.”AmazonPushed back against criticism that it unfairly competes with third-party sellers in its marketplace with its own products, saying its decision-making for how third-party sellers are treated is driven by a desire to give consumers wide selection, low prices and convenient delivery.Defended its private-label line known as AmazonBasics, saying private-label products are a “common retail practice.” It said it “generally does not distinguish the treatment of brands” based on the brand owner.Said its algorithm for listing shopping results doesn’t consider whether a merchant uses its Fulfillment by Amazon logistics service or whether a product is Amazon’s private label.Said it prohibits its private-label business from using individual sellers’ data to make decisions about product introductions, pricing or inventory.ApplePointed out that there are many apps that compete with its own services such as web browsing, maps, music and video.Said that users cannot uninstall its Safari web browser from the iPhone or switch to another default because Safari is “an essential part of iPhone’s functionality” as an operating system app.Explained that it’s not possible to reliably repair some products “because it is not feasible to split products into its component parts without significant risk of damage to those components.”\--With assistance from Naomi Nix, Gerrit De Vynck, Joe Light, David McLaughlin and Mark Gurman.To contact the reporter on this story: Ben Brody in Washington, D.C. at btenerellabr@bloomberg.netTo contact the editors responsible for this story: Sara Forden at sforden@bloomberg.net, Mark NiquetteFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
The Motley Fool
Enbridge Stock at $50: Will It Continue Climbing Higher?
Another strong earnings performance has given Enbridge Inc (TSX:ENB)(NYSE:ENB) stock a big boost.
The Motley Fool
Buy This Canadian Pipeline Stock to Recession-Proof Your Portfolio Heading Into 2020
Enbridge Inc. (TSX:ENB)(NYSE:ENB) is cheap right now, and smart investors should load up on shares right now.
Bloomberg
A $5 Billion Cholesterol Bet May Be an Overreach
(Bloomberg Opinion) -- Novartis AG appears ready to put a premium on convenience.Bloomberg News reported early Tuesday that the Swiss pharmaceutical giant is conducting due diligence on Medicines Co., a New Jersey-based biotechnology company with a promising drug called inclisiran that can substantially lower so-called bad cholesterol with just two annual treatments. Its principal rivals, Amgen Inc.'s Repatha, and Sanofi and Regeneron Pharmaceutical Inc.’s Praluent, require biweekly or monthly injections. Buying Medicines Co. wouldn’t be a megadeal, but it won’t come cheap. The company’s share price had already more than tripled this year as it released promising data, and a 20% boost prompted by deal speculation Tuesday pushed its market value well above $5 billion. If the price gets too high or the unnamed others reportedly also interested in the company start a bidding war, Novartis should be ready to walk away. Despite its promise, inclisiran also has its potential limits, and its sales potential is still highly uncertain. Approval isn’t expected until next year.Inclisiran’s predecessors Repatha and Praluent launched with much fanfare in 2015, and the assumption was that they would take on blockbuster status. Insurers balked at the high price of the drugs and the potentially massive market of patients with high cholesterol who might want it, and threw up barriers to access. As a result, the medicines got off to a slow sales start and continue to struggle. Both companies hoped that large outcomes trials proving that the drugs could prevent events such as heart attacks and strokes would turn things around and boost sales. The benefit wasn’t as significant as some hoped, and major sales acceleration never arrived. After a series of big price cuts, the drugs now cost under $6,000, less than half their list price at launch. The two drugs are expected to combine for around $940 million in sales this year; analysts once expected the two to have surpassed that on their own by now. Inclirisan works in a different way and looks like a more effective drug, able to lower cholesterol at a similar rate without nearly as many jabs of the needle. That’s better for patients, and physicians are likely to prefer it because that could translate to fewer missed doses and potentially better overall results. Patients and physicians don't get to choose on their own, though: Price-conscious health plans, insurers, and pharmacy benefit managers are the real decision-makers.These groups are pretty comfortable limiting the use of more expensive next-generation cholesterol drugs to a relatively small population. That reality and the ever-decreasing price of Praluent and Repatha suggests that inclisiran may have trouble pricing at much of a premium. The drug’s convenience and impact may finally expand this market to a broader group of Americans, especially if its owner is willing to compromise on cost at launch or an outcomes trial due in a few years reveals a positive surprise. It’s entirely possible, however, that it ends up with just a corner of a market that never gets all that big. Under the stewardship of a big company like Novartis, which has managed to navigate a slow launch and resistant market pretty well for its own heart drug Entresto, inclirisan is likely to deliver at least respectable sales some day. The company should be cautious if the price gets to a point where respectable won’t be nearly enough. To contact the author of this story: Max Nisen at mnisen@bloomberg.netTo contact the editor responsible for this story: Beth Williams at bewilliams@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Max Nisen is a Bloomberg Opinion columnist covering biotech, pharma and health care. He previously wrote about management and corporate strategy for Quartz and Business Insider.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Zacks
Merck's Heart Failure Candidate Meets Goal in Phase III Study
Merck (MRK) and German partner Bayer's vericiguat reduces the risk of heart failure hospitalization or cardiovascular death in patients with worsening chronic heart failure.
Bloomberg
‘Hipster Antitrust’ Might End the Megamerger Party
(Bloomberg Opinion) -- A few months ago, a group of Democratic senators, several of them presidential candidates and all members of the Senate’s antitrust subcommittee(1), wrote a letter to Joseph Simons, the Republican chairman of the Federal Trade Commission, to criticize two monster pharma deals under regulatory review: the $63 billion Allergan PLC-AbbVie Inc. merger, and Bristol-Myers Squibb Co.’s $74 billion purchase of Celgene Corp.Consolidation in the pharmaceutical industry, the senators wrote,is occurring against a backdrop of ever-rising prescription drug spending….It is more important than ever that the FTC take appropriate action to protect consumers. The Federal Trade Commission must carefully consider whether the proposed transactions may lessen competition, stifle innovation, or harm consumers.“The proposed AbbVie/Allergan and Bristol-Myers Squibb/Celgene transactions,” they added, “raise significant antitrust issues.”The FTC has not yet ruled on the Allergan-AbbVie deal, which was only announced in June, and which the companies hope to complete in early 2020.But on Friday, Simons and the two other Republican commissioners on the five-member FTC brushed aside the concerns of the Democrats and approved the Bristol-Myers Squibb deal with Celgene. Its only condition was that Celgene sell Otezla, its blockbuster psoriasis drug, apparently because Bristol-Myers Squibb has a promising psoriasis drug of its own in a phase 3 trial. The FTC has historically frowned on merged drug companies keeping overlapping drugs, fearing excessive market control.The FTC’s two Democratic commissioners, Rohit Chopra and Rebecca Kelly Slaughter, dissented, something Chopra in particular has made a habit of doing since he joined the FTC in 2018. During the Obama administration, Chopra was the student loan ombudsman at the Consumer Financial Protection Bureau, where he attempted to spur competition in student lending. At the FTC, he quickly gained a reputation for being in the vanguard of what’s sometimes called “hipster antitrust” — the effort to infuse new thinking into the antitrust arena.Much of this new thinking has been spurred by the rise of the big three tech giants, Facebook Inc., Alphabet Inc.’s Google, and Amazon.com Inc. Chopra has criticized the fines the FTC has levied against Facebook and YouTube (which is owned by Google), saying that “when a company can pay a fine from its ill-gotten gains, that’s not a penalty — that’s an incentive.” He seeks remedies that will diminish their market power and permanently alter their behavior.But Chopra isn’t just focused on Big Tech. He believes that in industry after industry, concentration has gone too far. The result, he concludes, has been less innovation, higher barriers to entry for new market entrants and higher prices for consumers. And because the FTC must approve mergers in a variety of sectors — chemical companies, agricultural concerns and, yes, pharmaceuticals — he is in a position to do something about it. Or rather, he may be soon, depending on the result of the 2020 election.Which is also why his dissents are worth noting. They offer an insight into how a Democratic administration might tackle market power and industry consolidation at a time when the status quo no longer seems acceptable.At the FTC, there has long been a bipartisan consensus that so long as two drug companies didn’t have overlapping products — or if they were willing to divest them — the merger would be approved. This long-standing practice, Chopra wrote in his dissent, is no longer good enough: “Some evidence shows that these mergers have choked off innovation, creating harms that are immeasurable for those waiting for a cure.” He then lays out all the elements of Bristol-Myers Squibb merger with Celgene that he believes the FTC should have considered:This massive $74 billion merger between Bristol-Myers Squibb (NYSE: BMY) and Celgene (NASDAQ: CELG) may have significant implications for patients and inventors, so we must be especially vigilant. In my view, this transaction appears to be heavily motivated by financial engineering and tax considerations (as opposed to a genuine drive for greater discovery of lifesaving medications), without clear benefits to patients or the public….In addition, there are also concerns about a history of anticompetitive conduct.(2)Expansive investigation for mergers like these is time well spent.He then goes on to list the questions he believes the FTC should have tried to answer—questions that go well beyond overlapping drugs:Will the merger facilitate a capital structure that magnifies incentives to engage in anticompetitive conduct or abuse of intellectual property? Will the merger deter formation of biotechnology firms that fuel much of the industry’s innovation? How can we know the effects on competition if we do not rigorously study or investigate these and other critical questions? Given our approach, I am not confident that the Commission has sufficient information to determine the full scope of potential harms to competition of this massive merger.Here is something else Chopra believes: The FTC has plenty of statutory authority to bring antitrust actions — or block mergers on antitrust grounds. It’s just that it has rarely used that authority, preferring instead to take the same laissez faire approach as the Justice Department and the courts. “What we’re advocating is not radical,” Chopra told me recently. “It’s a restoration. We have to see this as a core part of the economic policy tool kit.”So far in this early phase of the presidential race, corporate executives have tended to focus on, say, Elizabeth Warren’s wealth tax. That’s understandable, but a wealth tax will require Congress to pass a bill. So will Medicare For All, and any number of policies the various Democratic candidates hope to implement.But changing the government’s approach to antitrust — getting tougher on mergers and maybe even calling for some companies to be broken up — doesn’t require legislation. When a group of senators (some of whom also happen to be presidential candidates) writes to the FTC calling for greater scrutiny of a big pharma merger — and a leading light of the new antitrust movement is in the vanguard — it’s a pretty good bet that this is one thing that will change if there’s a new administration.Brace yourselves, Corporate America. The merger party may be coming to an end.(1) Its official name is the Senate Judiciary Subcommittee on Antitrust, Competition Policy and Consumer Rights.(2) Chopra’s dissent links to this 2018 NPR article, about the steps Celgene took to keep its multiple myeloma drug, Revlimid, away from generic competition.To contact the author of this story: Joe Nocera at jnocera3@bloomberg.netTo contact the editor responsible for this story: Timothy L. O'Brien at tobrien46@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Joe Nocera is a Bloomberg Opinion columnist covering business. He has written business columns for Esquire, GQ and the New York Times, and is the former editorial director of Fortune. His latest project is the Bloomberg-Wondery podcast "The Shrink Next Door."For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Zacks
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