Johnson & Johnson reaches settlement with Ohio over opioid crisis - BBC News

Johnson & Johnson has agreed to a $20.4m (£16.6m) settlement with two counties in the US state of Ohio.

The healthcare giant said it was made to avoid a trial on allegations of fuelling opioid addiction in the state.

Johnson & Johnson said in a statement that the deal was not an admission of liability for the state's epidemic.

It is the fourth drugmaker to settle claims in Ohio amid more than 2,600 lawsuits by state and local governments against painkiller manufacturers.

Tuesday's announcement comes after a landmark ruling in August which ordered Johnson & Johnson to pay $572m (£468m) for its part in fuelling Oklahoma's opioid addiction crisis.

In a statement, Johnson & Johnson said it would pay $10m to Cuyahoga and Summit counties, and another $5m to cover their legal expenses.

Another $5.4m will be given to charities involved with opioid-related programs in the counties.

What is the opioid crisis?

Opioids are a group of drugs that range from codeine, to illegal drugs like heroin.

Prescription opioids are primarily used for pain relief. They can be highly addictive.

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On average, 130 Americans die from an opioid overdose every day, according to the US Center for Disease Control and Prevention.

Opioids were involved in almost 400,000 overdose deaths in the US from 1999 to 2017, according to its research.

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2019-10-02 07:06:50Z
52780399115775

Global shares slip to one-month low after U.S. manufacturing shock - Yahoo Finance

Employees of the Tokyo Stock Exchange work at the bourse in Tokyo

By Hideyuki Sano

TOKYO (Reuters) - Global shares fell to one-month lows on Wednesday after U.S. manufacturing activity tumbled to more than a decade low, sparking worries that the fallout from the U.S.-China trade war is spreading to the U.S. economy.

A slowdown in U.S. economic growth would remove one of the few remaining bright spots in the global economy and come just as Europe is seen as close to falling into recession.

MSCI's gauge of stocks across the globe <.MIWD00000PUS>, covering 49 markets, dipped 0.06% to a low last seen in early September, after shedding 0.83% in the previous session.

European shares are expected to drop, with European stock futures <STXEc1> <FDXc1> <FFIc1> trading down 0.2%-0.4%.

In Asia, MSCI's ex-Japan Asia-Pacific shares index <.MIAPJ0000PUS> dropped 0.6%, with Australian shares <.AXJO> falling 1.3% and South Korean shares shedding 1.5%. Japan's Nikkei <.N225> slid 0.4%. China markets are closed for a one-week holiday.

Hong Kong's Hang Seng index <.HSI> was down 0.3% after a market holiday the previous day. The index fell as much as 1.2% in early trade. On Tuesday, Hong Kong police shot a teenage protester, the first to be hit by live ammunition in almost four months of unrest in the Chinese-ruled city.

Data on Hong Kong September retail sales is due later on Wednesday.

"Nothing other than a terrible number is conceivable here," ING chief Asia-Pacific economist Rob Carnell said in a note, adding that he was watching Hong Kong events "with a growing sense of despair."

Adding to tensions in Asia, North Korea carried out at least one more projectile launch on Wednesday, a day after it announced it will hold working-level talks with the United States at the weekend.

On Wall Street, the S&P 500 <.SPX> lost 1.23% to hit four-week lows.

Selling was triggered after the Institute for Supply Management's (ISM) index of factory activity, one of the most closely-watched data on U.S. manufacturing, dropped 1.3 points to 47.8, the lowest level since June 2009.

A reading below 50 indicates contraction in the manufacturing sector. Markets had been expecting the index to rise back above 50.

(GRAPHIC: U.S. manufacturing - https://fingfx.thomsonreuters.com/gfx/mkt/12/6830/6761/191002i.png)

The data came after euro zone manufacturing data showed the sharpest contraction in almost seven years.

"In terms of the outlook on manufacturing, U.S-China trade talks planned next week is everything. If that goes well, we could well see a V-shaped recovery in the ISM data in coming months," said Hirokazu Kabeya, chief global strategist at Daiwa Securities.

"That means we can't just bet on a further decline in the U.S. economy now. On the whole I don't think we need to change our view that the U.S. economy remains relatively solid," he added.

The poor data lifted the Fed funds rate futures price sharply, with the November contract <FFX9> now pricing in about an 80% chance the U.S. Federal Reserve will cut interest rates on Oct. 30, compared to just over 50% before the data.

U.S. President Donald Trump once again lashed out at the Federal Reserve on Tuesday, saying the central bank has kept interest rates "too high" and that a strong dollar is hurting U.S. factories.

It is another question, however, whether the Fed will cut interest rates as hastily as Trump, and financial markets, want.

"We don't think the Fed will cut rates this month. The Fed will probably want to cut rates in December, looking at the strength of the economy around that time when new tariffs on China will set in," said Toshifumi Umezawa, strategist at Pictet Asset Management.

"Given divides in opinion among Fed policy makers, it will be difficult to come to the conclusion by this month," he added.

Just on Tuesday, Chicago Fed President Charles Evans said the Fed can keep rates for now and there is scope to raise rates slightly over the next few years if the economy continues to grow.

In the currency market, the U.S. dollar slipped from Tuesday's two-year high against a basket of currencies as the ISM survey shook the notion that the U.S. economy will withstand the trade war.

The yen rose to 107.85 yen per dollar <JPY=>, from Tuesday's low of 108.47.

The euro stood at $1.0933 <EUR=>, having bounced off a near 2 1/2-year low of $1.0879 hit on Tuesday.

The Australian dollar fetched $0.6713 <AUD=D4>, having hit a 10 1/2-year low of $0.6672 the previous day after the Reserve Bank of Australia cut interest rates and expressed concern about job growth.

Gold rose to $1,479.80 per ounce <XAU=> from a two-month low of $1,459.50 hit on Tuesday on the back of a robust U.S. dollar.

The weak U.S. data pushed oil prices to near one-month lows, although a surprise drop in U.S. crude inventories helped them to recoil in Asia.

Brent crude <LCOc1> futures rose 0.9% to $59.42 a barrel, after hitting a four-week low of $58.41 on Tuesday, while U.S. West Texas Intermediate (WTI) crude <CLc1> gained 1.4% to $54.36 per barrel after hitting a one-month low of $53.05.

(Reporting by Hideyuki Sano; additional reporting by Noah Sin in Hong Kong, editing by Richard Borsuk and Richard Pullin)

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2019-10-02 06:00:00Z
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Building a bigger bundle: Telus acquires ADT Security's Canadian arm for $700-million - The Globe and Mail

Telus Corp. is buying one of the largest home-security businesses in the country, paying $700-million in cash for ADT Security Services Inc. as telecommunications giants race to expand their product bundles.

The deal is Telus’s second home-security acquisition in as many years, having already acquired the Western Canadian operations of AlarmForce Industries in early 2018.

At the moment, Telus’s security division services around 100,000 clients. The ADT purchase will add another roughly 500,000 Canadian customers.

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While the acquisition will make Telus a major player in home security in Canada, the telecom will have to invest in the ADT operation to fix some existing challenges. ADT incurred an US$88-million goodwill-impairment charge on the business late last year, and at the time ADT’s chief executive attributed the woes to “unique dynamics in the marketplace.”

These challenges included integrating ADT’s 2014 acquisition of Protectron and the competitive landscape in Canada. To help turn things around, ADT shuffled its Canadian leadership and hired a new country head last year.

Home and business security is viewed as a natural fit for telecom companies because of the opportunity to cross-sell phone, cable and internet services. Rogers Communications Inc. has run a home-security division since 2011, and BCE Inc. attracted attention by acquiring the bulk of AlarmForce last year, alongside Telus.

Product bundles have also proved to reduce customer churn – an industry term for client turnover. The more services a single household has with a single company, the more of a nuisance it can be to switch to a competitor.

“Home security is an important aspect of the connected home strategy with significant cross-selling opportunities with Telus’ current wireline products,” Canaccord Genuity analyst Aravinda Galappatthige wrote in a note to clients.

“The objective is to lower churn and price-sensitivity by bundling an increasing number of products at the household level," he added.

Telecoms are also vying to be major players in the internet of things, a term used when talking about everyday products that have computing devices embedded in them. Examples include household systems that allow homeowners to lock their doors or control their thermostats from afar.

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Beyond the benefits of making such services part of a product bundle, telecoms also hope to glean insights from the data they transmit – in the same way that technology giants such as Amazon.com Inc. and Alphabet Inc.'s Google learn from with the in-home devices, such as the Echo pod.

ADT is based in Boca Raton, Fla., and has operations in the United States and Canada. Detailed financials of its Canadian business were not provided, but the U.S. company recently disclosed that Canada contributes about 5 per cent – US$230-million – of its total revenue. The company’s CEO also recently said the Canadian business delivers positive free cash flow.

ADT was previously owned by a private equity firm but went public in early 2018. In the prospectus for the offering ADT disclosed that its Canadian arm delivered adjusted earnings before interest, taxes, depreciation and amortization of US$54-million in the six months ended March, 2016.

But analysts have had to estimate recent results. ADT’s total EBITDA is roughly 50 per cent, and Canaccord Genuity’s Mr. Galappatthige says the Canadian division’s margin could hover around 40 per cent.

Analyst Adam Shine at National Bank Financial used a “reasonably conservative margin” of 30 per cent for his estimates.

“We expect margins to move down in 2020 as Telus works to stem losses, strengthen the offering and improve customer service, with margins poised to move above 30 per cent post-2020 as synergies are optimized and cross-selling opportunities sought,” he wrote in a note to clients.

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Although Canada’s three major telecoms are all building out security divisions, Telus’s acquisition of ADT fits into its broader push beyond traditional phone, cable and internet services. Notably, it has been building a health division focused on digitizing and improving medical services; last year, for instance, the company launched a program that creates a secure video link between doctors and patients so they can talk face to face by mobile phone.

Last week, Telus announced that chief operating officer Josh Blair, who oversaw the company’s health business, was leaving. He was the second potential successor to Telus CEO Darren Entwistle to depart this year, after David Fuller, who ran the consumer telecom business, left in January.

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October 02, 2019 at 03:43AM

Canada's economy stalls after four months of growth; economists had expected more - Financial Post

OTTAWA — Canada’s economy was unexpectedly unchanged in July, following four months of growth, as the country’s mining, quarrying and oil and gas extraction sectors contracted, Statistics Canada data showed on Tuesday.

Analysts in a Reuters poll had predicted an increase of 0.1 per cent in July following a 0.2 per cent increase in June. Overall, 12 of the 20 industrial sectors monitored expanded on the month, while eight declined, the national statistics agency said.

The Canadian dollar weakened to 75.24 cents U.S. after the July GDP miss.

Canada is in the midst of a national election set for Oct. 21 where economic issues, like the cost-of-living, have played a central role on the campaign trail. Meanwhile, the Bank of Canada has held interest rates steady since last October as it monitors Canadian economic data.

“Today’s data are consistent with the [Bank of Canada’s] view that growth over the second half of the year is likely to be slightly slower than the first half,” said Josh Nye, a senior economist with RBC Economics, adding there were “few signs of a broader slowdown.”

“That gives the central bank time to be patient in assessing whether a bit more accommodation is needed to offset external headwinds,” Nye said in a note.

Statscan said goods-producing industries were down 0.7 per cent in July as outputs from all sectors – excepting utilities – declined. Services-producing industries were up for the fifth consecutive month, rising 0.3 per cent as the majority of its subsectors grew.

Canada’s mining, quarrying and oil and gas extraction sector dropped by 3.5 per cent in July, the largest decrease since May 2016, Statistics Canada said. Support activities for those same industries slumped by 11.5 per cent, the largest decline since December 2018, following three consecutive months of growth, as drilling and lower rigging services contracted.

Oil and gas extraction (except oilsands) fell 4.7 per cent, the biggest monthly decline seen in a decade, the agency said – thanks, in large part, to a shutdown of some offshore production facilities in Newfoundland and Labrador because of maintenance issues.

Declines were also reported in the construction sector, which dropped by 0.7 per cent.

Manufacturing fell for the second straight month, falling 0.1 per cent, while the transportation and warehouse sector contracted by 0.5 per cent on slower rail transportation. Real estate and related industries increased 4.2 per cent, while utilities rose by 1.5 per cent. Wholesale trade jumped 1.1 per cent, the sixth increase in seven months, Statscan said.

© Thomson Reuters 2019

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October 01, 2019 at 07:52PM

After best rally since 2000, Canadian stocks face a wall of worry - BNNBloomberg.ca

The best start to the year since 2000 for Canada’s stock market brought a surge of superlatives -- fresh highs and record profit forecasts.

Yet, expectations for the rest of the year are nowhere as rosy as the rally seen in the first quarter. The S&P/TSX Composite Index will sign off 2019 at 16,940, according to the average of six estimates compiled by Bloomberg. While that’s 18 per cent above its 2018 close, it’s a mere 1.7 per cent gain from the end of September.

The market’s wall of worry has only gotten higher. It could be last year’s fourth-quarter sell-off that’s prompting investor anxiety about a possible rehash this time around. May be it’s the lingering U.S.-China trade war that has investors worried. Or political turmoil across the world.

Expectations that the Fed would cut rates had investors anticipating narrower interest margins from banks in the U.S. and Canada, and that sent their stocks lower, said Laura Lau, senior portfolio manager at Brompton Corp. Financials make up nearly 33 per cent of Canada’s benchmark. Oil stocks, which account for more than 10 per cent of the gauge, have also been the pariahs of the market.

After climbing more than 12 per cent at the start of the year, Canada’s benchmark stock gauge gained less than 2 per cent in each of the two subsequent quarters. That’s still the longest quarterly rally since March 2017.

“September was an important inflection point for the TSX,” said Tina Normann, technical research analyst at Eight Capital. “The composite broke out to new highs driven by financials. This coincided with the Canadian 10-year yield stabilizing along with most global yields,” she said.

Still, signs of fatigue were visible at the peak of benchmark’s ascent. At its Sept. 20 high, the S&P/TSX Composite flirted with the overbought level and quickly slipped back down, snapping a four-week winning streak.

In the U.S., traders are bracing for a big shock as downside options that expire within the next month become expensive.

After suffering from a volatile third quarter, caution prevails ahead of more U.S.-China trade talks next week, the upcoming profit reporting reason, federal elections where Prime Minister Justin Trudeau is fighting for his political life and Bank of Canada’s monetary policy decision. These events are slated for October alone.

Winners and losers in Q3 on the TSX

Jon Erlichman has a look at what worked for investors as we enter a new quarter

The sight of an inverting U.S. Treasury yield curve and President Donald Trump’s relentless tweets about trade relations with China has put a shine on defensive and value stocks. Utilities, real estate and financials were among the top gainers in the third quarter and in September:

“One thing is clear, we’re definitely not going to be seeing interest rate hikes any time soon,” John Goldsmith, head of Canadian equities at Montrusco Bolton said on BNN Bloomberg on Tuesday. “That definitely puts the onus on what’s considered to be defensive sectors.”

Earnings season will be key to monitor the effects of slowing global growth and any spillover effects of the 18-month-old trade war. While profit estimates for companies listed on the Canadian benchmark have grown, the U.S. paints a different picture as CFOs have preemptively cut their forecasts at a rate not seen in three years.

“Four quarters of decelerating earnings may have reached a bottoming point primarily due to low interest rates and easier comparisons,” Normann said. “This creates a path for stronger earnings growth in 2020.”

--With assistance from Aury Cifuentes

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October 01, 2019 at 07:42PM

Vancouver hotels sue chanting, picketing employees over 'intolerable' noise - CBC.ca

The lobby of the upscale Hyatt Regency hotel on Burrard Street in Vancouver is ordinarily hushed, a grandiose hall permeated by subtle elevator music, soft-spoken front desk staff and the occasional whirr of the coffee machine at the in-house Starbucks.

But in recent days, the calm has been shattered by the pounding racket of striking employees marching in a picket line up and down the sidewalk outside the main entrance.

Chants from workers demanding safe, stable work are led by a colleague bellowing into a plastic horn. Other supporters sit on the hotel's front stoop, pummelling snare drums and plastic buckets with drumsticks hooked up to microphones and a sound system.

Picketers nearest the epicentre wear headphones or soft, orange ear plugs stuffed into their ears. They lean in and shout at each other to talk.

The noise they're making, they say, is to draw the public's attention to their cause.

Workers used plastic buckets and drumsticks during the strike on Monday morning

Hospitality workers on strike sit outside the Hyatt Regency Hotel in downtown Vancouver and use plastic buckets for drums on Sept. 30, 2019. 0:24

The Westin Bayshore and Pinnacle Hotels, nearer to the harbour, have also seen similar strike action since workers walked off the job Sept. 19. On Friday, all three hotels filed simultaneous lawsuits against the workers' union over the "substantial and unreasonable amount of deafening noise."

"The noise is intolerable," reads one lawsuit filed on behalf of the Hyatt's parent company, Innvest Hotels, adding the sound lasts from morning until night.

The union workers, represented by Unite Here Local 40, have been holding what they call an "open-ended strike" outside the hotels since the lockout began. Room attendants, chefs, front-desk staff and other employees walked off the job after more than a year of negotiations over issues related to safety, workload and job security failed to yield results.

"Instead of suing us, they should be trying to work with the union and make things better for their workers," union spokesperson Sharan Pawa said in response to news of a lawsuit during a phone call Monday. "It's disappointing."

Vancouver’s downtown hospitality workers from the Hotel Georgia, Hyatt Regency, Westin Bayshore and Pinnacle Harbourfront hotels walked off the job in a co-ordinated lunch hour strike outside the Hyatt in Vancouver on Sept. 17, 2019. (Maggie MacPherson/CBC)

As well as the allegations over excessive noise, the hotels claim striking employees are trespassing and hindering people, particularly guests, who have been trying to maneuver around the hotels since the strike began.

The lawsuits claim union staff know their behaviour is not only disturbing the peace but could cost the hotels financially.

The companies are asking the court for an order to stop employees from picketing on its premises. They also want workers to stop blocking anyone going to and from the hotels and forbidding them from making any noise louder than 70 decibels — about the same level of noise that would come from a vacuum cleaner.

The hotels' claims have not been tested in court.

Hospitality workers walked off the job on Sept. 19, 2019. (Maggie MacPherson/CBC)

Noise bylaws enforced by the City of Vancouver state no one is allowed to make noise in a public place that "unreasonably" disturbs peace and quiet in the area.

The lawsuits come after each of the three hotels lost a labour board challenge over new, replacement managers who were hired after striking staffers left their jobs. The B.C. Labour Relations Code bars employers from hiring replacement workers to do work usually done by union workers on strike.

A board member found the Hyatt, Westin and Pinnacle all violated the code and ordered the replacement managers off the job, though they noted the breach was not "egregious."

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October 01, 2019 at 04:20AM

Saudi Aramco Plans $75 Billion Dividend in 2020 - Yahoo Canada Finance

(Bloomberg) -- Saudi Aramco sought to underpin the targeted $2 trillion valuation for its initial public offering by increasing dividends, paying less tax and finding cornerstone investments from major Asian oil producers.

The moves, which came as the state-run company said it had restored all output halted by attacks on its main crude-processing facility last month, show preparations are accelerating for the listing, with the aim of offering shares on the Saudi bourse as soon as November.

The IPO is the centerpiece of Crown Prince Mohammed Bin Salman’s plans to revamp the Saudi economy and release billions in capital for the kingdom’s sovereign wealth fund. The efforts to make Aramco a more appealing investment and guarantee demand for shares come amid skepticism that the prince’s valuation is attainable.

Should the kingdom meet that target, the proposed payout of $75 billion next year would still leave dividend yields below those already offered by competitors like Exxon Mobil Corp. and Royal Dutch Shell Plc. While Aramco is the world’s most profitable company and produces about 10% of the world’s oil, it also carries greater risks, as illustrated by the drone and missile strike on key facilities in September.

Growing Dividends

The 2020 payment is part of plan for a growing, progressive dividend to investors, according to a corporate presentation posted on the company’s website on Monday.

Dividends of $75 billion would give investors a yield of 3.75% if the company achieves its $2 trillion valuation. Although a decent payout in a low-interest rate world, it’s a lower dividend than other Big Oil firms: investors in Shell receive 6.22%, while Exxon pays out 4.9%, according to data compiled by Bloomberg.

Equity investors will also receive only slightly higher returns than bond investors -- the yield on the company’s 2029 bond is about 3%.

Aramco could boost the dividend still further with one-time rewards to shareholders. It paid out a $20 billion special dividend in the first half of the year on the back of an “exceptionally strong financial performance” in 2018, the company said in August, though that payment caused its cash pile to drop markedly.

In a bid to reassure potential investors, the company also said that if the total dividend falls below $75 billion between 2020 and 2024 it will prioritize payouts to non-government shareholders.

Cornerstone Investors

Aramco has approached Asian state oil producers including Malaysia’s Petroliam Nasional Bhd., Sinopec Group and China National Petroleum Corp. about potential cornerstone investments in the IPO, people with knowledge of the matter said. The Gulf energy giant and its advisers have also reached out to China’s sovereign wealth fund and state-owned entities from the United Arab Emirates and Kuwait, including Abu Dhabi sovereign fund Mubadala Investment Co., as well as Canadian pension funds, the people said, asking not to be identified because the talks are private.

To read more about Aramco’s existing ties with major Asian producers, click here.

Deliberations are at a preliminary stage, and Aramco hasn’t yet received any firm commitments, the people said. Aramco’s advisers are arranging meetings with some potential investors this week and next week, according to the people. The funds could decide against buying into the offering, they said.

Aramco is leaning on business partners and friendly governments to help achieve its preferred valuation even after oil prices fell more than 25% over the past year. It’s casting a wide net to attract enough demand as it accelerates preparations for the listing in Riyadh. An original plan to list the company on an international exchange at the same time was dropped last year after international investors balked at the valuation.

Tax Changes

The third plank of Aramco’s pitch to investors was a changed schedule for royalty tax on oil production. Payments will be lower when oil is below $70 a barrel, but higher above that level.

Under a new royalty structure effective from January, Aramco will pay 15% for Brent prices up to $70 a barrel, 45% for Brent prices between $70 a barrel and $100 a barrel, and 80% on Brent prices above $100 a barrel. The current tax regime, introduced in January 2017, started at 20% and peaked at 50%.

The new royalty structure will be a significant boost at today’s oil prices -- it’s equivalent to about $3 a barrel on each of the 9.9 million barrels the company produces daily.

To contact Bloomberg News staff for this story: Matthew Martin in Dubai at mmartin128@bloomberg.net;Anthony DiPaola in Dubai at adipaola@bloomberg.net;Elffie Chew in Kuala Lumpur at echew16@bloomberg.net;Vinicy Chan in New York at vchan91@bloomberg.net;Steven Yang in Beijing at kyang74@bloomberg.net;Matthew Monks in New York at mmonks1@bloomberg.net;Jasmine Ng in Singapore at jng299@bloomberg.net

To contact the editors responsible for this story: Will Kennedy at wkennedy3@bloomberg.net, James Herron, Christopher Sell

For more articles like this, please visit us at bloomberg.com

©2019 Bloomberg L.P.

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October 01, 2019 at 02:59PM