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Lilly, Alexion report increase in profits; drug pricing bill advances to House

Top news

* Eli Lilly and Co.'s third quarter net income rose 5% to $1.36 billion, or $1.48 per share, compared to $1.29 billion, or $1.34 per share, in the year-ago period. The company's revenue increased by 3% to $5.48 billion, from $5.31 billion, in the third quarter of 2018.

* Alexion Pharmaceuticals Inc.'s third-quarter non-GAAP EPS increased by 38% to $2.79, compared to an EPS of $2.02 in the same period a year ago. The company's net income rose to $635.8 million, from $460.1 million, in the third quarter of 2018.

* Republicans on the House Ways and Means Committee made a number of attempts to try to stop or at least slowdown Speaker Nancy Pelosi's drug pricing legislation, but Democrats prevailed, favorably reporting the bill to the House floor after a more than 12-hour markup session. At the Oct. 22 hearing, the panel voted 24 to 17 to advance the bill, which would allow the federal government to set a maximum price on as many as 250 drugs that lack competition in the U.S., with Medicare beneficiaries paying no more than $2,000 out of pocket each year for their medicines.

* Days before the U.S. Food and Drug Administration found low levels of cancer-causing asbestos in a talc baby powder bought online, Johnson & Johnson CEO Alex Gorsky had testified in a case that the company's product did not contain asbestos, Reuters reported. Gorsky, who was testifying in a case involving a man who alleged that his cancer was caused by the use of the baby powder for decades, had cited thousands of tests and studies done on the products.

M&A and capital markets

* Zealand Pharma A/S is acquiring Toronto-based Encycle Therapeutics Inc. in a bid to expand its peptide platform with Encycle's potential peptide drug that is being developed to target inflammatory bowel disease.

* China's Harbin Pharmaceutical Group Co. Ltd. is looking to acquire U.S. health and nutrition products retailer GNC Holdings Inc. and take the company private, Bloomberg News reported citing people with knowledge of the matter. The Chinese company already holds a stake in GNC.

* RAPT Therapeutics Inc. is planning a Nasdaq IPO of its common shares to raise up to $92 million after it had reportedly postponed the offering. The South San Francisco, Calif.-based biotechnology company, which is majority-owned by Bristol-Myers Squibb Co., is developing drugs for cancer and inflammatory diseases.

Drug and product pipeline

* Biogen Inc. is doubling down on its experimental Alzheimer's disease drug aducanumab with plans to pursue U.S. approval, a surprise reversal that investors rewarded with a surge in the company's stock price and renewed optimism in the company's product pipeline. The news on aducanumab had dominated the company's earnings call, with analysts parsing what it might mean not only Biogen but for the future of Alzheimer's research and drug development.

Operational activity

* Amgen Inc. said David Meline is retiring as CFO and executive vice president of the company. Peter Griffith was appointed executive vice president of finance and will replace Meline as CFO on Jan. 1, 2020.

* Novartis AG lifted guidance for the year after stronger-than-expected sales of a raft of new medicines including Zolgensma for childhood spinal muscular atrophy and Lutathera, a nuclear-based cancer medicine. Meanwhile, the Swiss company also reported that its experimental asthma treatment fevipiprant failed to meet its efficacy endpoint in the Zeal 1 and 2 lung function studies in patients with a milder version of the condition.

The day ahead

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

In Asia, the Hang Seng shed 0.82% to 26,566.73, and the Nikkei 225 rose 0.34% to 22,625.38.

In Europe, around midday, the FTSE 100 increased 0.08% to 7,217.66, and the Euronext 100 fell 0.66% to 1,085.66.

Click here to read about today's financial markets, setting out the factors driving stocks, bonds and currencies around the world ahead of the New York open.

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