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The United States may have a broken political system, a dysfunctional health care delivery system, and an excess of entitled people who don’t know when to stay off the beaches or out of the bars. But we do have one big thing going for us: the smartest and most creative entrepreneurs on the face of the earth.
One of them is George Yancopoulos, who 30 years ago helped found Regeneron, and continues today as its chief scientist. He is working the front lines in the war against Covid-19, and getting tantalizingly close to a cure. I had the opportunity to talk with him late last week, and left the conversation feeling far more optimistic about the course of this deadly disease. You can listen to the interview here.
Yancopoulos described a three-front battle against Covid-19. The first front are efforts to apply existing drugs to treat the disease–including a Regeneron rheumatoid arthritis drug that went into clinical trials against Covid-19 last week. The second is the search for a vaccine, which will likely take “a year or two,” because of the need for careful testing for safety.
The third approach is to develop a new treatment targeted directly at the disease. At Regeneron, that involves using a technique Yancopoulos developed and used to treat Ebola. The scientists implant human genes in mice, then infect those mice with the coronavirus, and then harvest, “clone” and purify the antibodies that result. While a vaccine provokes the body to create its own antibodies, Yancopoulos’ treatment would inject antibodies directly into the patient. The protection won’t last as long as that coming from a vaccine, but it could be extremely important in protecting frontline health care workers and high-risk individuals.
“We’ll begin testing in June,” he says. “We have the capacity to make hundreds of thousands of doses a month, and we could increase that tenfold.”
When I noted that Regeneron’s stock price has been heading north since the first of February, in part because of this work, Yancopoulos responded: “We don’t watch the stock. We pay attention to delivering important medicines to people. We are not a commercially driven company.”
“Really?” I challenged. “You aren’t focused on your bottom line?”
“If you deliver important drugs to people, the money takes care of itself,” he said. “Innovation has saved us before. That’s what we have to focus on again.”
And by the way, if you listen to the podcast, you will notice it says at the end that it was recorded at Fortune Media offices in New York. That’s no longer true. I safely recorded the Yancopoulos interview over a phone line at my home in Greenwich, Conn. (a town that was practicing social distancing long before it became a thing!).
James Bullard, the president of the Federal Reserve Bank of St. Louis, has predicted a possible halving of U.S. GDP (far worse than even Goldman Sachs's dire prediction of a 24% drop) and an American unemployment rate of 30% in the coming quarter. "There is more that [the Fed] can do if necessary," he said, referring to the Fed's existing authority. "There is probably much more in the months ahead depending on where Congress wants to go." Meanwhile, the OECD says the economic shock of the outbreak already outstrips the financial crisis. Bloomberg
Senate Democrats have blocked a proposed $2 trillion stimulus deal that, they say, would have give given big business too much money with insufficient conditions and oversight. The Democrats, who are still in negotiations with the administration, want the cash to come with restrictions on executive compensation and stock buybacks—they also object to secrecy around which companies are getting the state aid. Financial Times
The worsening impact of the coronavirus pandemic—over 340,000 confirmed cases, almost 15,000 dead—continues to alarm investors. Asian markets fell today, with the exception of the Nikkei 225 (up 2%), and the Stoxx Europe 600 fell 4.5% shortly after markets opened. U.S. futures also indicate another drop at open. AFP
The New York Stock Exchange's trading floor is closed indefinitely as of today—the first time in its history that it has closed the floor while the markets are open. As Erik Sherman explains, IPOs are still possible though none are scheduled. Investors should not notice that traders and designated market makers are working from home. Fortune
AROUND THE WATER COOLER
With the European Commission having triggered an "escape clause" in the EU's deficit rules, European national governments should now be able to pump as much money into the economy as they need to. Spanish Prime Minister Pedro Sánchez has however called for an EU-wide "Marshall Plan of reconstruction", arguing: "We are making an extraordinary fiscal effort, but it is important that it is not only at the national level." Politico
Japanese Prime Minister Shinzo Abe has conceded that the 2020 Tokyo Olympics may have to be postponed—but not cancelled. Abe: "If the [International Olympic Committee's] decision means it becomes impossible to hold [the Olympics] in a ‘complete form,’ as I have previously said, then a decision may have to be made to postpone them." Canada and Australia have said they won't be sending their sportspeople to the Games, and the former has called for a one-year postponement. CNBC
Icahn and Occidental
Carl Icahn is reportedly set to send his lieutenants into the Occidental board room as part of a truce with the embattled oil firm. Occidental would get to bring back former CEO Stephen Chazen as chairman, and current CEO Vicki Hollub would get to keep her job—Icahn had been trying to replace the entire board. Wall Street Journal
Hugo Boss boss
Hugo Boss is looking for a new CEO, after it announced the imminent departure of current chief Mark Langer at the end of Q3. Langer will stay on as a consultant until the end of the year, in order to help the German fashion house deal with the coronavirus crisis. Reuters
This edition of CEO Daily was edited by David Meyer.