Spread & Containment
A functional city’s response to the COVID-19 pandemic
A functional city’s response to the COVID-19 pandemic
Cities are currently being tested to the extreme with the coronavirus pandemic (COVID-19).
Simultaneously a health crisis, social crisis, and economic crisis, COVID-19 is laying bare how well cities are planned and managed. Its impact is showing the extent to which each city is able to function – or not – especially during times of crisis.
COVID-19 is a massive challenge for cities on the front line, rich and poor alike. The measures taken to control the spread of the virus are having massive implications on cities due to their economic structure; their preparedness for such a crisis, especially the state of their public health and service delivery systems; and the extent to which their population’s health and livelihoods are vulnerable.
In normal times, there might be many attributes that cities strive to compete on and excel at the global level including livability, competitiveness, and sustainability. But in any given day and especially in a time of crisis, a city must function well for its citizens.
But what does this mean? And how can a functional city make a difference now, during this time of crisis?
A functional city means that governance and service delivery systems work seamlessly, effectively and simultaneously along a range of dimensions – it is a city that delivers high-quality public services for all people, in both rich and poor neighborhoods; that works hard to create economic opportunities for residents and businesses; that prioritizes community participation and inclusion for all, and that makes policies and decisions that create a stimulating and enjoyable life for its residents.
A good example is Helsinki. Finland’s capital has 650,000 inhabitants and sits at the heart of a dynamic metropolitan region with 1.5 million inhabitants, a little over a quarter of the country’s population but with nearly 40 percent of the nation’s GDP.
In 2017, the new City Strategy modeled Helsinki as the world’s most functional city by offering the best conditions possible for good urban life for residents, businesses, and visitors. Functionality in Helsinki grows from an emphasis on equal opportunity for all. This includes ability to live, work, play and express oneself in a safe environment. Education is one of the cornerstones – not only does the city have some of the best schools in the world (Finland ranks among the highest countries globally in reading and science, with Helsinki’s schools leading the way), but more importantly it has some of the “best worst schools,” meaning there is little difference between the schools in rich and poor neighborhoods.
Helsinki’s management approach is based on grounding every city decision on functionality, safety and openness. This approach results in a high level of trust between citizens and the local government, which in turn facilitates the city leadership’s ability to operate more effectively in a time of crisis.
Helsinki’s functional city approach combines three pillars, all of which are proving critical to the city’s efforts to tackle the COVID-19 crisis. The first pillar is a smart city, in which digital technology and innovation are the foundation of efficient service delivery. The second is an inclusive city, in which community participation is at the center of policymaking, the design and delivery of public services, and the prioritization of budgets and investments. The third is a sustainable city, set on a course to achieve carbon neutrality by 2035 while strengthening energy security, enhancing mobility and improving the quality of life. Much of the city’s recovery plan is based on amplifying these foundations of the city strategy, namely digital city services, inclusive development and sustainable infrastructure.
Much of Helsinki’s economy, like that of many cities in developed countries, is based on services and the creative economy, which are structured around people-to-people interactions and knowledge spillovers. So the COVID-19 virus is testing the city to its limits. Creative industries, the arts, travel, congresses, events, and the start-up scene have started feeling the impact of COVID-19 deeply. In addition, the inability to engage with others in an urban environment and the cancelation of events and the resulting impact on services takes a toll on people’s mental health. What makes a city is now temporarily gone.
While cities like Helsinki are not able to totally prevent the combined effects of the current health, economic, and social crisis resulting from COVID-19, the foundations of its functional city approach are enabling the city to manage the crisis holistically and deliver results efficiently.
How has Helsinki’s functionality performed during the COVID-19 pandemic?
In Finland, the implementation of most restrictive measures and the day-to-day management of the crisis situation is the responsibility of cities. Helsinki has been especially proactive in managing its response to the pandemic and has drawn on its local and international networks for city-to-city collaboration. The main concern from the outset was the social impacts of the restrictive measures such as social distancing and disruptions of everyday life, which were introduced early on. Mental health issues, domestic violence, disadvantaged youth in danger of falling behind and substance abuse problems were some the threats targeted from the outset.
To contain the spread of the epidemic, schools have been closed since March 18, although pre-schools and grades 1-3 were allowed to remain open to allow critical personnel to work. To maintain the quality of its school system, the city leveraged its impressive digital technology platforms to create digital classrooms for students. The city also developed digital cultural services for its population in its aim to maintain a stimulating urban life and to reduce the mental health impacts from social distancing and isolation.
The city has been especially attentive to its vulnerable population, especially the elderly who are at risk from potential viral exposure and also at risk of social isolation. Teaming up with NGOs and the church, the city ensured that each and every one of its elderly residents above 70 years of age may get personalized services, including support in their shopping for food or pharmacy needs.
Helsinki City Hall has been especially attuned to supporting the creative industries, which are a mainstay of the economy and especially vulnerable during the COVID-19 epidemic. One important policy early on was to provide three-month rent-free periods in city-owned properties for entrepreneurs affected by the coronavirus, which proved an important measure as the city controls about two-thirds of the land in Helsinki’s urbanized area.
City Hall maintains a special Operations Group that collects data through various digital technology platforms and runs scenario analysis to inform decision-making. The Mayor leads a special Coordination Group that has met daily since March 1 to monitor progress of the crisis management systems, prepare for recovery and take timely decisions. There is daily streaming of the Mayor’s information sessions to citizens and staff. The city has also transferred civil servant staff from non-critical to critical functions. This has been one way to keep the social and health services high-functioning throughout the crisis.
Overall, the city’s efforts – facilitated by its functional city pillars – are having results in terms of curbing the number of infected, maintaining a good level of health care facilities and personnel that has thus far been able to cope with surges in infections, sustaining the delivery of quality public services despite the evolving situation, and keeping up good communication channels with residents and a cohesive public spirit as people respond positively to restrictions. The effective delivery of measures has been supported by the trust-based relationship between local government and citizens that allows the administration to act efficiently.
The world will be very different post-COVID-19. Even though public health issues are still the first and foremost concern, cities are starting to move towards recovery planning. Every step taken now already helps build the post-COVID-19 world. Cities’ success is dependent upon their ability to anticipate global trends and transformations. Even though nations might be taking the lead for now in putting together stimulus packages, it will – in large part – be the job of cities to implement the return to the “new normal.”
Before the crisis, Helsinki was doing well with quality public services, a flourishing culture and lifestyle, a rapidly growing travel industry, a burgeoning and rapidly growing start-up scene, and a very healthy economy. The city was alive.
We strongly believe that the course of urbanization and the age of cities will not alter due to the crisis. Innovation, creativity and capital will keep gravitating and drawing people towards cities. People will keep having a continuous need for a community and each other. Digitalization will offer new solutions that will make the global community of cities even more interconnected.
The pressing global issues of this century – whether dealing with the refugee crisis, climate change or ravaging epidemics – have thrust cities like Helsinki as well as local governments into taking more and more of a global leadership role, on issues that were traditionally the remit of national governments. As a result, it looks like we are increasingly living in the century of cities.
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Spread & Containment
Asking the right dumb questions
You’ll have to forgive the truncated newsletter this week. Turns out I brought more back from Chicago than a couple of robot stress balls (the one piece…
You’ll have to forgive the truncated newsletter this week. Turns out I brought more back from Chicago than a couple of robot stress balls (the one piece of swag I will gladly accept). I was telling someone ahead of the ProMat trip that I’ve returned to 2019 travel levels this year. One bit I’d forgotten was the frequency and severity of convention colds — “con crud,” as my comics friends used to call it.
I’ve been mostly housebound for the last few days, dealing with this special brand of Chicago-style deep-dish viral infection. The past three years have no doubt hobbled my immune system, but after catching COVID-19 three times, it’s frankly refreshing to have a classic, good old-fashioned head cold. Sometimes you want the band you see live to play the hits, you know? I’m rediscovering the transformative properties of honey in a cup of tea.
The good news for me is that (and, hopefully, you) is I’ve got a trio of interviews from ProMat that I’ve been wanting to share in Actuator. As I said last week, the trip was really insightful. At one of the after-show events, someone asked me how one gets into tech journalism. It’s something I’ve been asked from time to time, and I always have the same answer. There are two paths in. One is as a technologist; the other is as a journalist.
It’s obvious on the face of it. But the point is that people tend to enter the field in one of two distinct ways. Either they love writing or they’re really into tech. I was the former. I moved to New York City to write about music. It’s something I still do, but it’s never fully paid the bills. The good news for me is I sincerely believe it’s easier to learn about technology than it is to learn how to be a good writer.
I suspect the world of robotics startups is similarly bifurcated. You enter as either a robotics expert or someone with a deep knowledge of the field that’s being automated. I often think about the time iRobot CEO Colin Angle told me that, in order to become a successful roboticist, he first had to become a vacuum salesman. He and his fellow co-founders got into the world through the robotics side. And then there’s Locus robotics, which began as a logistics company that started building robots out of necessity.
Both approaches are valid, and I’m not entirely sure one is better than the other, assuming you’re willing to surround yourself with assertive people who possess deep knowledge in areas where you fall short. I don’t know if I entirely buy the old adage that there’s no such thing as a dumb question, but I do believe that dumb questions are necessary, and you need to get comfortable asking them. You also need to find a group of people you’re comfortable asking. Smart people know the right dumb questions to ask.
Covering robotics has been a similar journey for me. I learned as much about supply chain/logistics as the robots that serve them at last week’s event. That’s been an extremely edifying aspect of writing about the space. In robotics, no one really gets to be a pure roboticist anymore.
Q&A with Rick Faulk
I’m gonna kick things off this week with highlights from a trio of ProMat interviews. First up is Locus Robotics CEO, Rick Faulk. The full interview is here.
TC: You potentially have the foundation to automate the entire process.
RF: We absolutely do that today. It’s not a dream.
It’s not lights out. Lights out might happen 10 years from now, but the ROI is not there to do it today. It may be there down the road. We’ve got advanced product groups working on some things that are looking at how to get more labor out of the equation. Our strategy is to minimize labor over time. We’re doing integrations with Berkshire Grey and others to minimize labor. To get to a dark building is going to be years away.
Have you explored front-of-house — retail or restaurants?
We have a lot of calls about restaurants. Our strategy is to focus. There are 135,000 warehouses out there that have to be automated. Less than 5% are automated today. I was in Japan recently, and my meal was filled by a robot. I look around and say, “Hey, we could do that.” But it’s a different market.
What is the safety protocol? If a robot and I are walking toward each other on the floor, will it stop first?
It will stop or they’ll navigate around. It’s unbelievably smart. If you saw what happened on the back end — it’s dynamically planning paths in real time. Each robot is talking to other robots. This robot will tell this robot over here, “You can’t get through here, so go around.” If there’s an accident, we’ll go around it.
They’re all creating a large, cloud-based map together in real time.
That’s exactly what it is.
When was the company founded?
[In] 2014. We actually spun out of a company called Quiet Logistics. It was a 3PL. We were fully automated with Kiva. Amazon bought Kiva in 2012, and said, “We’re going to take the product off the market.” We looked for another robot and couldn’t find one, so we decided to build one.
The form factors are similar.
Their form factor is basically the bottom. It goes under a shelf and brings the shelf back to the station to do a pick. The great thing about our solution is we can go into a brownfield building. They’re great and they work, but it will also take four times the number of robots to do the same work our robots do.
Amazon keeps coming up in my conversations in the space as a motivator for warehouses to adopt technologies to remain competitive. But there’s an even deeper connection here.
Amazon is actually our best marketing organization. They’re setting the bar for SLAs (service-level agreements). Every single one of these 3PLs walking around here [has] to do same- or next-day delivery, because that’s what’s being demanded by their clients.
Do the systems’ style require in-person deployment?
The interesting thing during COVID is we actually deployed a site over FaceTime.
Someone walked around the warehouse with a phone?
Yeah. It’s not our preferred method. They probably actually did a better job than we did. It was terrific.
As far as efficiency, that could make a lot of sense, moving forward.
Yeah. It does still require humans to go in, do the installation and training — that sort of thing. I think it will be a while before we get away from that. But it’s not hard to do. We take folks off the street, train them and in a month they know how to deploy.
Where are they manufactured?
We manufacture them in Boston, believe it or not. We have contract manufacturers manufacturing some components, like the base and the mast. And then we integrate them together in Boston. We do the final assembly and then do all the shipments.
As you expand sales globally, are there plans to open additional manufacturing sites?
We will eventually. Right now we’re doing some assemblies in Amsterdam. We’re doing all refurbishments for Europe in Amsterdam. […] There’s a big sustainability story, too. Sustainability is really important to big clients like DHL. Ours is an inherently green model. We have over 12,000 robots in the field. You can count the number of robots we’ve scrapped on two hands. Everything gets recycled to the field. A robot will come back after three or four years and we’ll rewrap it. We may have to swap out a camera, a light or something. And then it goes back into service under a RaaS model.
What happened in the cases where they had to be scrapped?
They got hit by forklifts and they were unrepairable. I mean crushed.
Any additional fundraising on the horizon?
We’ve raised about $430 million, went through our Series F. Next leg in our financing will be an IPO. Probably. We have the numbers to do it now. The market conditions are not right to do it, for all the reasons you know.
Do you have a rough timeline?
It will be next year, but the markets have got to recover. We don’t control that.
Q&A with Jerome Dubois
Next up, fittingly, is Jerome Dubois, the co-founder of Locus’ chief competitor, 6 River Systems (now a part of Shopify). Full interview here.
TC: Why was [the Shopify acquisition] the right move? Had you considered IPO’ing or moving in a different direction?
JD: In 2019, when we were raising money, we were doing well. But Shopify presents itself and says, “Hey, we’re interested in investing in the space. We want to build out a logistics network. We need technology like yours to make it happen. We’ve got the right team; you know about the space. Let’s see if this works out.”
What we’ve been able to do is leverage a tremendous amount of investment from Shopify to grow the company. We were about 120 employees at 30 sites. We’re at 420 employees now and over 110 sites globally.
Amazon buys Kiva and cuts off third-party access to their robots. That must have been a discussion you had with Shopify.
Up front. “If that’s what the plan is, we’re not interested.” We had a strong positive trajectory; we had strong investors. Everyone was really bullish on it. That’s not what it’s been. It’s been the opposite. We’ve been run independently from Shopify. We continue to invest and grow the business.
From a business perspective, I understand Amazon’s decision to cut off access and give itself a leg up. What’s in it for Shopify if anyone can still deploy your robots?
Shopify’s mantra is very different from Amazon. I’m responsible for Shopify’s logistics. Shopify is the brand behind the brand, so they have a relationship with merchants and the customers. They want to own a relationship with the merchant. It’s about building the right tools and making it easier for the merchant to succeed. Supply chain is a huge issue for lots of merchants. To sell the first thing, they have to fulfill the first thing, so Shopify is making it easier for them to print off a shipping label.
Now, if you’ve got to do 100 shipping letters a day, you’re not going to do that by yourself. You want us to fulfill it for you, and Shopify built out a fulfillment network using a lot of third parties, and our technology is the backbone of the warehouse.
Watching you — Locus or Fetch — you’re more or less maintaining a form factor. Obviously, Amazon is diversifying. For many of these customers, I imagine the ideal robot is something that’s not only mobile and autonomous, but also actually does the picking itself. Is this something you’re exploring?
Most of the AMR (autonomous mobile robot) scene has gotten to a point where the hardware is commoditized. The robots are generally pretty reliable. Some are maybe higher quality than others, but what matters the most is the workflows that are being enacted by these robots. The big thing that’s differentiating Locus and us is, we actually come in with predefined workflows that do a specific kind of work. It’s not just a generic robot that comes in and does stuff. So you can integrate it into your workflow very quickly, because it knows you want to do a batch pick and sortation. It knows that you want to do discreet order picking. Those are all workflows that have been predefined and prefilled in the solution.
With respect to the solving of the grabbing and picking, I’ve been on the record for a long time saying it’s a really hard problem. I’m not sure picking in e-comm or out of the bin is the right place for that solution. If you think about the infrastructure that’s required to solve going into an aisle and grabbing a pink shirt versus a blue shirt in a dark aisle using robots, it doesn’t work very well, currently. That’s why goods-to-person makes more sense in that environment. If you try to use arms, a Kiva-like solution or a shuttle-type solution, where the inventory is being brought to a station and the lighting is there, then I think arms are going to be effective there.
Are these the kinds of problems you invest R&D in?
Not the picking side. In the world of total addressable market — the industry as a whole, between Locus, us, Fetch and others — is at maybe 5% penetration. I think there’s plenty of opportunity for us to go and implement a lot of our technology in other places. I also think the logical expansion is around the case and pallet operations.
Interoperability is an interesting conversation. No one makes robots for every use case. If you want to get near full autonomous, you’re going to have a lot of different robots.
We are not going to be a fit for 100% of the picks in the building. For the 20% that we’re not doing, you still leverage all the goodness of our management consoles, our training and that kind of stuff, and you can extend out with [the mobile fulfillment application]. And it’s not just picking. It’s receiving, it’s put away and whatever else. It’s the first step for us, in terms of proving wall-to-wall capabilities.
What does interoperability look like beyond that?
We do system interoperability today. We interface with automation systems all the time out in the field. That’s an important part of interoperability. We’re passing important messages on how big a box we need to build and in what sequence it needs to be built.
When you’re independent, you’re focused on getting to portability. Does that pressure change when you’re acquired by a Shopify?
I think the difference with Shopify is, it allows us to think more long-term in terms of doing the right thing without having the pressure of investors. That was one of the benefits. We are delivering lots of longer-term software bets.
Q&A with Peter Chen
Lastly, since I’ve chatted with co-founder Pieter Abbeel a number of times over the years, it felt right to have a formal conversation with Covariant CEO Peter Chen. Full interview here.
TC: A lot of researchers are taking a lot of different approaches to learning. What’s different about yours?
PC: A lot of the founding team was from OpenAI — like three of the four co-founders. If you look at what OpenAI has done in the last three to four years to the language space, it’s basically taking a foundation model approach to language. Before the recent ChatGPT, there were a lot of natural language processing AIs out there. Search, translate, sentiment detection, spam detection — there were loads of natural language AIs out there. The approach before GPT is, for each use case, you train a specific AI to it, using a smaller subset of data. Look at the results now, and GPT basically abolishes the field of translation, and it’s not even trained to translation. The foundation model approach is basically, instead of using small amounts of data that’s specific to one situation or train a model that’s specific to one circumstance, let’s train a large foundation-generalized model on a lot more data, so the AI is more generalized.
You’re focused on picking and placing, but are you also laying the foundation for future applications?
Definitely. The grasping capability or pick and place capability is definitely the first general capability that we’re giving the robots. But if you look behind the scenes, there’s a lot of 3D understanding or object understanding. There are a lot of cognitive primitives that are generalizable to future robotic applications. That being said, grasping or picking is such a vast space we can work on this for a while.
You go after picking and placing first because there’s a clear need for it.
There’s clear need, and there’s also a clear lack of technology for it. The interesting thing is, if you came by this show 10 years ago, you would have been able to find picking robots. They just wouldn’t work. The industry has struggled with this for a very long time. People said this couldn’t work without AI, so people tried niche AI and off-the-shelf AI, and they didn’t work.
Your systems are feeding into a central database and every pick is informing machines how to pick in the future.
Yeah. The funny thing is that almost every item we touch passes through a warehouse at some point. It’s almost a central clearing place of everything in the physical world. When you start by building AI for warehouses, it’s a great foundation for AI that goes out of warehouses. Say you take an apple out of the field and bring it to an agricultural plant — it’s seen an apple before. It’s seen strawberries before.
That’s a one-to-one. I pick an apple in a fulfillment center, so I can pick an apple in a field. More abstractly, how can these learnings be applied to other facets of life?
If we want to take a step back from Covariant specifically, and think about where the technology trend is going, we’re seeing an interesting convergence of AI, software and mechatronics. Traditionally, these three fields are somewhat separate from each other. Mechatronics is what you’ll find when you come to this show. It’s about repeatable movement. If you talk to the salespeople, they tell you about reliability, how this machine can do the same thing over and over again.
The really amazing evolution we have seen from Silicon Valley in the last 15 to 20 years is in software. People have cracked the code on how to build really complex and highly intelligent looking software. All of these apps we’re using [are] really people harnessing the capabilities of software. Now we are at the front seat of AI, with all of the amazing advances. When you ask me what’s beyond warehouses, where I see this really going is the convergence of these three trends to build highly autonomous physical machines in the world. You need the convergence of all of the technologies.
You mentioned ChatGPT coming in and blindsiding people making translation software. That’s something that happens in technology. Are you afraid of a GPT coming in and effectively blindsiding the work that Covariant is doing?
That’s a good question for a lot of people, but I think we had an unfair advantage in that we started with pretty much the same belief that OpenAI had with building foundational models. General AI is a better approach than building niche AI. That’s what we have been doing for the last five years. I would say that we are in a very good position, and we are very glad OpenAI demonstrated that this philosophy works really well. We’re very excited to do that in the world of robotics.
News of the week
The big news of the week quietly slipped out the day after ProMat drew to a close. Berkshire Grey, which had a strong presence at the event, announced on Friday a merger agreement that finds SoftBank Group acquiring all outstanding capital stock it didn’t already own. The all-cash deal is valued at around $375 million.
The post-SPAC life hasn’t been easy for the company, in spite of a generally booming market for logistics automation. Locus CEO Rick Faulk told me above that the company plans to IPO next year, after the market settles down. The category is still a young one, and there remains an open question around how many big players will be able to support themselves. For example, 6 River Systems and Fetch have both been acquired, by Shopify and Zebra, respectively.
“After a thoughtful review of value creation opportunities available to Berkshire Grey, we are pleased to have reached this agreement with SoftBank, which we believe offers significant value to our stockholders,” CEO Tom Wagner said in a release. “SoftBank is a great partner and this merger will strengthen our ability to serve customers with our disruptive AI robotics technology as they seek to become more efficient in their operations and maintain a competitive edge.”
Unlike the Kiva deal that set much of this category in motion a decade ago, SoftBank maintains that it’s bullish about offering BG’s product to existing and new customers. Says managing partner, Vikas J. Parekh:
As a long-time partner and investor in Berkshire Grey, we have a shared vision for robotics and automation. Berkshire Grey is a pioneer in transformative, AI-enabled robotic technologies that address use cases in retail, eCommerce, grocery, 3PL, and package handling companies. We look forward to partnering with Berkshire Grey to accelerate their growth and deliver ongoing excellence for customers.
A healthy Series A this week from Venti Technologies. The Singapore/U.S. firm, whose name translates to “large Starbucks cup,” raised $28.8 million, led by LG Technology Ventures. The startup is building autonomous systems for warehouses, ports and the like.
“If you have a big logistics facility where you run vehicles, the largest cost is human capital: drivers,” co-founder and CEO Heidi Wyle tells TechCrunch. “Our customers are telling us that they expect to save over 50% of their operations costs with self-driving vehicles. Think they will have huge savings.”
This week in fun pivots, Neubility is making the shift from adorable last-mile delivery robots to security bots. This isn’t the company’s first pivot, either. Kate notes that it’s now done so five times since its founding. Fifth time’s the charm, right?
Neubility currently has 50 robots out in the world, a number it plans to raise significantly, with as many as 400 by year’s end. That will be helped along by the $2.6 million recently tacked onto its existing $26 million Series A.
Model-Prime emerged out of stealth this week with a $2.3 million seed round, bringing its total raise to $3.3 million. The funding was led by Eniac Ventures and featured Endeavors and Quiet Capital. The small Pittsburgh-based firm was founded by veterans of the self-driving world, Arun Venkatadri and Jeanine Gritzer, who were seeking a way to create reusable data logs for robotics companies.
The startup says its tech, “handles important tasks like pulling the metadata, automated tagging, and making logs searchable. The vision is to make the robotics industry more like web apps, or mobile apps, where it now seems silly to build your own data solution when you could just use Datadog or Snowflake instead.”
Saildrone, meanwhile, is showcasing Voyager, a 33-foot uncrewed water vehicle. The system sports cameras, radar and an acoustic system designed to map a body of water down to 900 feet. The company has been testing the boat out in the world since last February and is set to begin full-scale production at a rate of a boat a week.
Finally, some research out of MIT. Robust MADER is a new version of MADER, which the team introduced in 2020 to help drones avoid in-air collisions.
“MADER worked great in simulations, but it hadn’t been tested in hardware. So, we built a bunch of drones and started flying them,” says grad student Kota Kondo. “The drones need to talk to each other to share trajectories, but once you start flying, you realize pretty quickly that there are always communication delays that introduce some failures.”
The new version adds in a delay before setting out on a new trajectory. That added time will allow it to receive and process information from fellow drones and adjust as needed. Kondo adds, “If you want to fly safer, you have to be careful, so it is reasonable that if you don’t want to collide with an obstacle, it will take you more time to get to your destination. If you collide with something, no matter how fast you go, it doesn’t really matter because you won’t reach your destination.”
Here you go, way too fast. Don’t slow down, you’re gonna crash. Na-na-na-na-na-na-na-na-na. (Subscribe to Actuator!)
Asking the right dumb questions by Brian Heater originally published on TechCrunchtesting covid-19 singapore japan europe
FDA approval of over-the-counter Narcan is an important step in the effort to combat the US opioid crisis
The Food and Drug Administration’s approval of Narcan will make the lifesaving drug more widely available, especially to those who might be likely to…
On March 29, 2023, the U.S. Food and Drug Administration approved Narcan for over-the-counter sale. Narcan is the 4-milligram nasal spray version of naloxone, a medication that can quickly counteract an opioid overdose.
The FDA’s greenlighting of over-the-counter naloxone means that it will be available for purchase without a prescription at more than 60,000 pharmacies nationwide. That means that, for 90% of Americans, naloxone nasal spray will be accessible at a pharmacy within 5 miles from home. It will also likely be available at gas stations, supermarkets and convenience stores. The transition from prescription to over-the-counter status is expected to take a few months.
We are pharmacists and public health experts who seek to increase public acceptance of and access to naloxone.
We think that making naloxone available over the counter is an essential step in reducing deaths due to overdose and destigmatizing opioid use disorder. Over-the-counter access to naloxone will permit more people to carry and administer it to help others who are overdosing. Moreover, increasing naloxone’s over-the-counter availability will convey the message that risks associated with substance use disorder warrant a pervasive intervention much as with other illnesses.
Deaths from opioid overdoses across the U.S. have increased nearly threefold since 2015. Between October 2021 and October 2022, approximately 77,000 people died from opioid overdoses in the U.S. Since 2016, the synthetic opioid fentanyl has been responsible for most of the drug-involved overdose deaths in America.
What is naloxone?
Naloxone reverses overdose from prescription opioids like fentanyl, oxycodone and hydrocodone and recreational opioids like heroin. Naloxone works by competitively binding to the same receptors in the central nervous system that opioids bind to for euphoric effects. When naloxone is administered and reaches these receptors, it can block the euphoric effects of opioids and reverse respiratory depression when opioid overdose occurs.
There are two common ways to administer naloxone. One is through the prepackaged nasal sprays, such as Narcan and Kloxxado or generic versions of the drug. The other method is via auto-injectors, like ZIMHI, which deliver naloxone through injection, similar to the way epinephrine is delivered by an EpiPen as an emergency treatment for life-threatening allergic reactions.
The FDA will review a second over-the-counter application for naloxone auto-injectors at a later date. Although no interaction with a health care provider will be needed to purchase over-the-counter naloxone, when naloxone is purchased at a pharmacy, a knowledgeable pharmacist will be able to help people choose a product and explain instructions for use.
Research shows that when people who are likely to witness or respond to opioid overdoses have naloxone, they can save patients’ lives. This also includes bystanders as well as first responders like police officers and paramedics.
But until now, people in those situations could intervene only if they were carrying prescription naloxone or knew where to retrieve it quickly. Friends and family of people who use opioids are often given prescriptions for naloxone for emergency use. Over-the-counter naloxone will help make the drug more accessible to members of the general public.
Reducing stigma and saving lives
Naloxone is a safe medication with minimal side effects. It works only for those with opioids in their system, and it’s unlikely to cause harm if given by mistake to someone who’s not actively overdosing on opioids.
Since approximately 40% of overdoses occur in the presence of someone else, we believe public access to naloxone is extremely important. People may wish to have naloxone on hand if someone they know is at an increased risk for opioid overdose, including people who have opioid use disorder or people who take high amounts of prescribed opioid medications.
Community centers and recreational facilities may also keep naloxone on hand, similar to the placement of automated external defibrillators in public spaces for emergency use when someone has a heart attack.
There’s a long-held public stigma that suggests addiction is a moral failing rather than a chronic yet treatable health condition. Those who request naloxone or who have an opioid use disorder experience stigma and often aren’t comfortable disclosing their drug use to others, or seeking medical treatment. Removing naloxone’s prescription requirements by making it over the counter could decrease the stigma experienced by individuals since they no longer must request it from a health care provider or behind the pharmacy counter.
In addition, we encourage health care providers and members of the general public to use less stigmatizing language when discussing addiction.
Often, medications switched from prescription to over the counter are not covered by insurance. It remains unclear if this will be the case with Narcan. If so, the costs will shift to the patient, highlighting the reason continued support of programs that offer naloxone free of charge remains important.
What’s more, over-the-counter access could paradoxically cause a decrease in the drug’s availability. A rise in purchases could make it harder to buy naloxone if manufacturer supply does not keep up with increased consumer demand. The U.S. experienced such shortages of over-the-counter drugs in late 2022 during the nationwide surges in flu, respiratory syncytial virus and COVID-19.
Federal and state governments could lessen these potential barriers by subsidizing the cost of over-the-counter naloxone and working with drug manufacturers to provide production incentives to meet public demand.
The effects of nationwide access to over-the-counter naloxone on opioid-related deaths remain to be seen, but making this medication more widely available is an important next step in our nation’s response to the opioid crisis.
Lucas Berenbrok is part owner of the consulting company, Embarx, LLC.
Janice L. Pringle is affiliated with C4 Recovery.
Joni Carroll receives grant funding from the Centers for Disease Control and Prevention Overdose Data to Action.depression covid-19 disease control treatment fda medication deaths recovery
Spread & Containment
What will housing credit look like in next recession?
We need to understand the credit channels in the U.S. today and why they’re so different than the period of 2002-2008.
With the banking crisis spurring more talk of a recession, the question now is: What would housing credit look like in a recession? Many people predicted that the U.S. housing market would crash during the pandemic. One of the main reasons for that fear was that housing credit was about to get tight, meaning fewer people could buy homes with mortgages.
Even though housing data recovered by May 2020, people didn’t want to believe the data and assumed housing was going to fall more, especially with forbearance on the horizon.
How can we be sure not to make the same mistake that millions of people made by calling for housing to crash in 2020 and 2021? We can do it by understanding the credit channels in the U.S. today and why they’re so different than the period of 2002-2008.
Credit getting tighter
What we traditionally see going into recession and during a downturn is credit getting tighter. What does tighter credit mean for housing? It means certain mortgage products might not be offered, FICO score requirements might be raised, and it can mean pricing for certain loans goes up to account for the risk.
However, the current housing market is much different than the credit boom-and-bust cycle of 2002-2008, and it’s vital to understand why.
Credit availability was booming during the housing bubble years, then collapsed epically. The MBA chart below shows what a vast collapse it was then. Now, with new regulations in place since the financial crisis, that credit expansion and collapse will be a once-in-a-lifetime event.
Why is this so important? Over the years, one of my big talking points has been that we didn’t have a massive credit housing boom in the U.S. during the last few years, nor can we ever. Because of the qualified mortgage laws of 2010, we are lending to the capacity to own the debt, which means speculative credit cycles from primary resident homebuyers or even investors can’t occur in the same fashion as from 2002-2005.
The purchase application data below clearly shows this. We had many years of much higher credit growth during the bubble years and not that much credit in the past few years.
This is important because the existing home sales market was booming during the 2005 peak; that market needed credit to stay loose to keep demand high and growing. That is not the case today. We had a massive collapse in demand in 2022, not because credit was getting tighter but because affordability was an issue.
After rates fell recently, working from a shallow level, we saw one of the most significant month-to-month sales prints in history with the last existing home sales report.
This big bounce in demand came from a waterfall dive, and we needed at least 12 weeks of positive, forward-looking data to get this demand increase, but it happened as mortgage rates fell. Mortgage credit can get tight for jumbo loans, non-QM loans and home equity lines, but general conforming Freddie Mac and Fannie Mae loans, FHA, and VA loans should be steady during the next recession.
Spreads are getting wide again
What has happened recently with the banking crisis is that the mortgage-backed securities market has gotten more stressed, so rates are higher than they should be as the spreads between the 10-year yield and mortgage rates have widened again.
As you can see below, the spreads got much broader during the great financial crisis and COVID-19 recessionary periods. There is usually a 1.60%- 1.80% difference between the 10-year yield and 30-year mortgage rate, but now we are at 3%.
The chart below tracks the stress in the mortgage-backed securities market: the higher the spread between the 10-year yield and 30-year mortgage gets, the higher the line goes. This means the dance partners, while still dancing, are creating some space between each other.
The Federal Reserve doesn’t care about the U.S. housing market. The Fed is complaining mortgage rates are returning to 6% and people buying homes might make their job harder. The Fed will rush to save a bank, but won’t whisper a word for an entire housing market to improve spreads.
So, the risk here is that when we have a job-loss recession, spreads get even worse, as the Federal Reserve doesn’t care. I would usually think the Fed might assist the economy, but with this Federal Reserve, you never know what they will and won’t do. I talked about this Wednesday on CNBC.
We need to be mindful of this when the recession hits. The housing market might not get any assistance, even though we are getting closer to the one-year call when I put the housing market in a recession on June 16, 2022.
Homeowner balance sheets look awesome this time around
As I said above, credit getting tighter in relationship to demand is not a thing because we didn’t have a massive credit boom like that from 2002-2005 to then have a bust from 2005-2008 due to credit getting tighter.
The mortgage market can get stressed because the spreads can get wider, meaning rates can be higher than at ordinary times. However, we aren’t going to see the credit availability collapse in the same way we did in 2008.
The most significant difference between 2008 and the last 13 years after the qualified mortgage laws were implemented is that we don’t see a surge in housing credit stress before a job-loss recession. If there is one chart I would show every day, it’s the one below: housing credit stress was easy to spot years before the job-loss recession happened. Today it’s much easier to see that we don’t have similar credit stress with homeowners.
Because the U.S. has no more exotic loan debt structures, we don’t have large-scale risk tied to homeowners and banks. Over time, the foreclosure data should get closer to pre-COVID-19 levels, but nothing like the credit stress we saw from 2003-2008.
Homeowner financial data looks awesome; fixed debt cost, rising wages, and cash flow look better and better over time. As you can see below, mortgage debt service payments as a percent of disposable personal income look excellent, much better than in 2008.
This means the cash flow looks excellent! Do you want to know why people aren’t giving up homes? A U.S. home with a 30-year fixed mortgage is the best hedge on planet earth. As inflation comes down, homeowners’ cash flow gets better. During inflationary periods, your wages grow faster, but as a homeowner, your debt costs stay the same.
Unlike 2008, we don’t have a major risk of loans recasting with payments that the homeowner can’t afford even if they were still working. We will see a rise in 30-day delinquencies, and over 9-12 months, we will see a foreclosure process work. However, in terms of scale, nothing like what we saw in 2008.
Hopefully, this gives you three different credit takes on the credit question when we go into recession.
Credit tightening concerning most loans being done today isn’t a significant risk because government agencies back most loans done in the U.S. However, the mortgage-backed securities market can stay stressed longer than most people imagine when the next recession happens.
We don’t have a rise in foreclosures as we did from 2005-2008 before the job-loss recession. However, we do have traditional risk, meaning that late-cycle homebuyers with small down payments can be a future foreclosure risk if they lose their jobs.
So, we have a different economic backdrop now than in 2008 and 2020. Both recessions were very different from each other, but this gives you an idea of some of the significant dynamics around housing credit, debt and risk whenever we go into the next recession.
As always, we will take the data one day, week, and month at a time and walk this path together.
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