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Bayer completes $62.5B Monsanto deal; DOJ says key ACA part unconstitutional

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Insight Weekly: US stock performance; banks' M&A risk; COVID-19 vaccine makers' earnings

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Bayer completes $62.5B Monsanto deal; DOJ says key ACA part unconstitutional

Top news

* Bayer AG completed its $62.5 billion acquisition of seed manufacturer Monsanto Co. yesterday after receiving all necessary approvals from regulators. Monsanto shareholders are being paid $128 per share, and its shares will be delisted from the New York Stock Exchange.

* The U.S. Department of Justice said the Affordable Care Act's individual mandate is unconstitutional under a tax law that President Donald Trump signed in 2017, Reuters reported, citing a brief filed in a federal court in Texas. The tax law removed the penalty for not having health insurance and nullifies two major ACA provisions linked to the individual mandate, including one that prohibits insurers from denying coverage to individuals with pre-existing conditions, the department said.

* The White House has partnered with a group of internet companies, television media organizations and two nonprofits, Truth Initiative and the Ad Council, to launch a series of advertisements aimed at deterring Americans, particularly youth, from abusing and misusing opioids.

The ads come as the House prepares to vote next week on the first round of dozens of bills that were sent to the floor by the Energy and Commerce Committee last month to address the U.S. opioid crisis.

* Drug industry leaders — concerned about medicine and medical device shortages post-Brexit — are clamoring for an interim agreement to allow the smooth passage of drugs between the U.K. and Europe, the Financial Times reports.

Fearing shortages, drugmakers in the U.K. are also investing millions to secure the constant supply of medicines to patients — money that could have been used in developing new therapies, Bloomberg News writes.

* The U.S. House of Representatives Science, Space, and Technology Committee called on Elisabete Weiderpass, newly elected director of the World Health Organization's International Agency for Research on Cancer, or IARC, to testify at a hearing in July regarding the agency's scientific conclusions, Reuters reported.

In 2016, two congressional committees started an investigation regarding some controversial assessments from IARC, which claimed that coffee, mobile phones and processed meat cause cancer.

M&A and capital markets

* Japan's Takeda Pharmaceutical Co. Ltd. entered a credit agreement for up to $7.5 billion in term loans to help fund its planned £46 billion acquisition of Shire PLC. Besides the cash consideration for the Dublin-based drugmaker, borrowings under the agreement will also be used to refinance a portion of the $30.85 billion bridge loan Takeda secured last May 8.

* Amarantus BioScience Holdings Inc. is planning to either sell or launch an IPO for its wholly owned unit Elto Pharma Inc., which is developing the drug Eltoprazine for treating dyskinesia, or uncontrolled movement related to Parkinson's disease treatment.

Drug and product pipeline

* Novartis AG said patients with progressive midgut neuroendocrine tumors who received its medicine Lutathera had a better quality of life when compared to those who were administered another treatment.

* Roche Holding AG won U.S. Food and Drug Administration approval to market Rituxan to treat adults with moderate to severe pemphigus vulgaris, a rare, potentially fatal autoimmune disease.

* The U.S. FDA and the European Medicines Agency accepted Pfizer Inc.'s breast cancer drug talazoparib for review. The U.S. regulator also granted priority review designation to the drug, which is intended to treat patients with inherited BRCA-mutated HER2-negative breast cancer that has grown outside the organ or has spread to other parts of the body.

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* Biogen Inc. has secured an option to acquire Tokyo-based TMS Co. Ltd.'s mid-stage asset TMS-007 for the treatment of acute ischemic stroke — the sudden loss of blood circulation to an area of the brain resulting in a corresponding loss of neurologic function. Biogen will pay $4 million upfront and an additional $18 million once it decides to go ahead with the acquisition.

Operational activity

* As part of restructuring its product portfolio, Advaxis Inc. will be seeking partners to develop its experimental medicine Axal, for treating human papillomavirus, or HPV, associated cancers, including those forming in the cervix.

* Novo Nordisk A/S is considering eliminating up to 3,000 jobs due to tough market conditions in the U.S., Reuters reported, citing Danish daily Borsen.

* Pfizer won an appeal against an £84.2 million fine charged by the U.K.'s Competition and Markets Authority for an allegedly illegal price increase on an epilepsy treatment, The Financial Times reported. The competition regulator imposed the fine on Pfizer along with an additional £5.2 million penalty on drug distributor Flynn Pharma Ltd. in 2016 for abusing their dominant position by charging unfair prices.

* David Feinberg, CEO of Geisinger Health System, told CNBC yesterday that he is staying in his current role, shortly after the news outlet reported that he was the top pick to run the joint healthcare venture between Amazon.com Inc., Berkshire Hathaway Inc. and JPMorgan Chase & Co.

Our features

Biotechs grapple with risks as Right To Try becomes a reality: A week after President Donald Trump signed the bill into law, biotechnology companies are staking out their positions amid looming pressure.

Other features

* The number of suicide rates across the U.S. rose by 25% from 1999 to 2016 despite numerous prevention efforts, The New York Times has a report.

* Scientists have developed a blood test to predict a pregnant person's due date and identify those who are at the risk of giving birth prematurely, The New York Times writes in a feature.

* STAT has an interview with Penny Heaton, CEO of the newly created Bill and Melinda Gates Medical Research Institute — a nonprofit biotech spun out from the Bill and Melinda Gates Foundation.

The day ahead

Early morning futures indicators pointed to a lower opening for the U.S. market.

In Asia, the Hang Seng declined 1.76% to 30,958.21, and the Nikkei 225 decreased 0.56% to 22,694.50.

In Europe, around midday, the FTSE 100 was down 0.66% to 7,653.51, and the Euronext 100 was down 0.40% to 1,053.12.

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