* President Donald Trump made a vow that a substantial drop in prescription drug prices is on the horizon, with plans to be announced next week to combat the cost of pharmaceuticals.
* One in 7 babies from U.S. territories exposed to the Zika virus in the womb had health problems by at least 1 year of age, including birth defects, vision and hearing difficulties, seizures, brain damage and developmental delays, the Centers for Disease Control and Prevention reported.
* Novo Nordisk A/S, a Danish maker of drugs for diabetes and obesity, saw second-quarter earnings rise 4% and affirmed its full-year sales growth and operating profit outlook.
On the policy front
* The Democratic Republic of Congo's latest Ebola outbreak spread from the Zaire strain of the virus, the health officials said, adding that the inoculation by Merck & Co. Inc.'s vaccine will begin on Wednesday, Reuters reported. The vaccine will be first given to health workers and responders, followed by contacts and contacts of contacts, a World Health Organization spokesman said.
* The Trump administration will permit private insurance plans sold through the federal government's Medicare Advantage program to require seniors and the disabled to use cheaper medicines before they can try more expensive drugs administered in doctors' offices or outpatient facilities — an approach known as step therapy.
M&A and capital markets
* Activist investor Carl Icahn sees online retail giant Amazon.com Inc. as an "existential threat" to Cigna Corp.'s planned deal to acquire pharmacy benefit manager Express Scripts Holding Co.
* Cigna issued a reply to Carl Icahn, saying that the activist investor's recent letter urging shareholders to reject a pending merger with Express Scripts "demonstrates an uninformed view of the current healthcare marketplace and Cigna's strategy."
* British biotechnology startup Sensyne Health Ltd. is looking to raise £60 million through an initial public offering and plans to list on London's AIM market next week, Reuters reported.
* G Medical Innovations Holdings Ltd. is planning an IPO of its Chinese unit on the Hong Kong Stock Exchange. The company is listing Guangzhou Yimei Innovative Medical Science and Technology Co. Ltd. on the main board of the stock exchange.
Drug and product pipeline
* Boston-based Vertex Pharmaceuticals Inc. said the U.S. Food and Drug Administration approved its medicine Orkambi to treat certain children with the most common form of cystic fibrosis.
* Bridgewater, N.J.-based Insmed Inc. said a committee of the U.S. Food and Drug Administration voted 12 to 2 in favor of the safety and effectiveness of its medicine ALIS to treat patients with a type of lung disease and who have limited or no treatment options. ALIS is aimed at treating adult patients with nontuberculous mycobacterial lung disease — a rare infection that can damage the lungs.
* Spark Therapeutics Inc., a Philadelphia-based biotechnology company, plans to initiate a late-stage study of its hemophilia A gene therapy candidate SPK-8011 following trial results that showed a 97% reduction in annualized bleeding rate among patients.
* Trevose, Pa.-based Strongbridge Biopharma PLC said a phase 3 study of Recorlev met its main goal of improving symptoms in patients with endogenous Cushing’s syndrome. The rare disease is caused by high exposure to cortisol, the body's main stress hormone, potentially leading to obesity, high blood pressure, diabetes and cardiovascular complications.
* Bellerophon Therapeutics Inc. will stop the phase 3 clinical trial for its potential high blood pressure treatment INOpulse after a data monitoring committee found that the results relating to the main goal of the study were insufficient to support its continuation.
* Israel's BioLineRx Ltd. said its potential cancer therapy BL-8040 will proceed to a full-fledged phase 3 study after being found safe and tolerable in an initial phase.
* H. Lundbeck A/S said its second-quarter profit rose year over year, and it revised its financial guidance for 2018. The Danish drugmaker said its second-quarter core profit was 1.38 billion Danish kroner, up from 813 million kroner a year earlier.
* Tokyo-based drugmaker Otsuka Holdings Co. Ltd. said EPS for the first half was ¥117.11, a gain of 50.1% from ¥78.04 in the year-earlier period.
* Dublin-based Jazz Pharmaceuticals PLC saw a year-over-year increase in profit for the second quarter of 2018, with a 27% increase in revenue due to strong sales of its products.
* Swiss drugmaker Vifor Pharma AG posted first-half EBITDA of CHF192 million, up from CHF132.9 million in the 2017. Core earnings per share was CHF2.66, up 336.1% from CHF0.61 in the year-ago period.
* U.K.-based pharmaceutical giant AstraZeneca PLC agreed to pay $110 million to settle claims it fraudulently marketed two of its drugs to Texas Medicaid providers.
* Chandler, Ariz.-based INSYS Therapeutics Inc. agreed to pay $150 million as part of an agreement in principle with the U.S. Department of Justice to settle a probe in the illegal sales practices by its former employees that fueled the U.S. opioid crises. The agreement, subject to final negotiation, may also involve additional contingency-based payments of up to $75 million.
* Novartis AG said it is working with authorities in 23 countries to shore up supplies of hypertension treatment valsartan, once one of the Swiss drugmaker's best sellers, after a recall of medicines containing an ingredient supplied by Zhejiang Huahai Pharmaceutical Co. Ltd.
* Chinese vaccine maker Changsheng Bio-Technology Co. Ltd., which is being investigated by the government following a safety scandal, had started faking production records for its rabies vaccine in April 2014, Reuters reported.
* The South Korean drugmaker Celltrion Inc. received a warning letter from the U.S. Food and Drug Administration for violations at its manufacturing plant in Incheon, South Korea. The FDA listed eight observations from seven inspections of the site in July.
* Takeda Pharmaceutical Co. Ltd. and Redwood City, Calif.-based Ambys Medicines agreed to launch a partnership to develop therapies for serious liver diseases. Under the agreement, Japan's Takeda committed $100 million, including participation in the Ambys' series A financing, in exchange for an option to ex-U.S. commercialization rights for the first four products that reach regulatory stage.
How OTC Markets fights stock fraud enabled by 'fake news': OTC Markets Group, home to hundreds of small banks, healthcare companies and tech firms, has been working for several years to clean up fraud on its trading venues, a task that has grown more difficult amid the rise of fake websites and social media.
* The Wall Street Journal wrote that incoming GlaxoSmithKline PLC CFO Iain Mackay will face tough choices at the U.K. drugmaker, which is undergoing an overhaul.
* Large employers are losing faith in pharmacy benefit managers' rebate system in providing health coverage and are looking for alternative approaches including telehealth services, CNBC reported citing a survey by National Business Group on Health.
The day ahead
Early morning futures indicators pointed to a mixed opening for the U.S. market.
In Asia, Hang Seng climbed 0.39% to 28,359.14, while the Nikkei 225 fell 0.08% to 22,644.31.
In Europe, around midday, the FTSE 100 gained 0.86% to 7,785.15, and the Euronext 100 rose 0.04% to 1,081.78.
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