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Bird flu has made a comeback, driving up prices for holiday turkeys

Hunters are warned to take precautions handling wild birds, and the virus can spill over to non-avian species, so no one should approach wild animals that…

Healthy turkeys on a farm in West Newfield, Maine. Shawn Patrick Ouellette/Portland Press Herald via Getty Images

An outbreak of highly pathogenic avian influenza has spread through chicken and turkey flocks in 46 states since it was first detected in Indiana on Feb. 8, 2022. The outbreak is also taking a heavy toll in Canada and Europe.

Better known as bird flu, avian influenza is a family of highly contagious viruses that are not harmful to wild birds that transmit it but are deadly to domesticated birds. The virus spreads quickly through poultry flocks and almost always causes severe disease or death, so when it is detected, officials quarantine the site and cull all the birds in the infected flock.

As of early November, this outbreak had led to the culling of over 50 million birds from Maine to Oregon, driving up prices for eggs and poultry – including holiday turkeys. This matches the toll from a 2014-2015 bird flu outbreak that previously was considered the most significant animal disease event in U.S. history. Yuko Sato, an associate professor of veterinary medicine who works with poultry producers, explains why so many birds are getting sick and whether the outbreak threatens human health.

Why is avian influenza so deadly for domesticated birds but not for wild birds that carry it?

Avian influenza (AI) is a contagious virus that affects all birds. There are two groups of aviain influenza viruses that cause disease in chickens: highly pathogenic AI (HPAI) and low pathogenic AI (LPAI).

HPAI viruses cause high mortality in poultry, and occasionally in some wild birds. LPAI can cause mild to moderate disease in poultry, and usually little to no clinical signs of illness in wild birds.

The primary natural hosts and reservoir of AI viruses are wild waterfowl, such as ducks and geese. This means that the virus is well adapted to them, and these birds do not typically get sick when they are infected with it.

But when domesticated poultry, such as chickens and turkeys, come in direct or indirect contact with feces of infected wild birds, they become infected and start to show symptoms, such as lethargy, coughing and sneezing and sudden death.

Map of US and Canada showing avian influenza distribution among commercial, backyard and wild bird flocks.
Migrating wild birds, most of which are not harmed by avian influenza, are known to spread the disease to commercial and backyard flocks. USGS

There are multiple strains of avian influenza. What type is this outbreak, and is it dangerous to humans?

The virus of concern in this outbreak is a Eurasian H5N1 HPAI virus that causes high mortality and severe clinical signs in domesticated poultry. Scientists who monitor wild bird flocks have also detected a reassortant virus that contains genes from both the Eurasian H5 and low pathogenic North American viruses. Reassortment happens when multiple strains of the virus circulating in the bird population exchange genes to create a new strain of the virus, much as new strains of COVID-19 like omicron and delta have emerged during the ongoing pandemic.

According to the U.S. Centers for Disease Control and Prevention, the risk to public health from this outbreak is low. No human illnesses were associated with the 2014-2015 H5N1 outbreak in the U.S.

The only known human case in the U.S. during the current outbreak was found in a man in Colorado who had contact with infected birds. The man tested positive once, then negative on follow-up tests, and reported only mild symptoms, so health experts theorized that the virus may have been present in his nose without actually causing an infection.

Health officials recommend avoiding direct contact with wild birds to avoid spreading avian flu.

Are these outbreaks connected to wild bird migration?

Yes, wild bird migration has been an important factor in this outbreak. Scientists have detected the same H5N1 virus that is infecting poultry in more than 3,000 wild birds during this outbreak, compared with 75 detections during the 2014-2015 outbreak. This tells us that the virus is highly prevalent in wild bird populations. While most detections occur in ducks and geese, the virus has also been found in other bird species, including raptors, such as eagles and vultures, and other waterfowl, such as swans and pelicans.

The U.S. Department of Agriculture’s Animal and Plant Health Inspection Service conducts targeted sampling to test wild birds in fall and early winter, which correlates with migration season. This helps scientists and wildlife managers understand where avian flu viruses may be introduced to domestic flocks, track their spread and monitor for any reassortment.

Because there are high amounts of virus circulating, wildlife agencies advise against handling or eating game birds that appear sick. Waterfowl can also be infected, with no signs of illness, so hunters need to be especially careful not to handle or eat game birds without properly cleaning their clothing and equipment afterward and ensuring the birds are cooked to an internal temperature of 165 degrees F (74 C) before consuming them.

Hunters and other members of the public are advised not to approach any wild animals that are acting strange and to report any such sightings to officials. In some cases, avian flu viruses have spilled over to other wild animals, such as red foxes, raccoons, skunks, opossums and bobcats. We did not see this trend in 2014-15.

HPAI is a transboundary disease, which means it is highly contagious and spreads rapidly across national borders. Some research indicates that detection of HPAI viruses in wild birds has become more common.

Detection of HPAI in wild birds is seasonal, with a peak in February and a low point in September. Many migratory bird species travel thousands of miles between continents, posing a continuing risk of AI virus transmission.

On the positive side, we have better diagnostic tests for much more rapid and improved detection of avian influenza compared to 20 to 30 years ago, and can use molecular diagnostics such as polymerase chain reaction (PCR) tests – the same method labs use to detect COVID-19 infections.

How are poultry farmers affected when HPAI is detected in their flocks?

To detect AI, the U.S. Department of Agriculture oversees routine testing of flocks by farmers and carries out federal inspection programs to ensure that eggs and birds are safe and free of virus. When H5N1 is diagnosed on a farm or in a backyard flock, state and federal officials will quarantine the site and cull and dispose of all the birds in the infected flock. Then the site is cleaned and decontaminated, a process that includes removing organic materials like manure and chicken feed that can harbor virus particles.

After several weeks without new virus detections, the area is required to test negative in order to be deemed free of infection. We call this process the four D’s of outbreak control: diagnosis, depopulation, disposal and decontamination.

Wire cages hold chicken figurines
Live birds are banned at agricultural fairs during bird flu outbreaks to avoid spreading infections. These fake chickens were on display at the Cabarrus County, N.C., fair in 2015, a previous H5N1 outbreak year. Elizabeth W. Kearley via Getty Images

Flock owners are eligible for federal indemnity payments for birds and eggs that have to be destroyed because of avian influenza, as well as for the costs of removing birds and cleaning and disinfecting their farms. This support is designed to help producers move past an outbreak, get their farms back in condition for restocking and get back into business as soon as possible.

But these payments almost never cover all of farmers’ expenses. Poultry farms can’t always recover financially from major bird flu outbreaks. That makes it especially important to focus on prevention strategies to keep the virus out.

This is an updated version of an article originally published on April 7, 2022.

Yuko Sato receives funding from the US Department of Agriculture, the Bill and Melinda Gates Foundation, allied industry companies, the Pew Foundation, the Egg Industry Center, the US Poultry & Egg Association, and internally through Iowa State University. She is affiliated with the Iowa Poultry Association, the Iowa Turkey Federation, United Egg Producers and the US Animal Health Association.

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EY Eyes Comeback for Biopharma M&A

EY noted that the total value of biopharma M&A in 2022 was $88 billion, down 15% from $104 billion in 2021. The $88 billion accounted for most of the…

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A recent trickle of mergers and acquisitions (M&A) announcements in the billion-dollar-and-up range suggests that biopharma may be ready to resume dealmaking this year—although the value and number of deals isn’t expected to return to the highs seen just before the pandemic.

2022 ended with a handful of 10- and 11-figure M&A deals, led by Amgen’s $27.8 billion buyout of Horizon Therapeutics, announced December 13. The dealmaking continued into January with three buyouts announced on the first day of the recent J.P. Morgan Healthcare Conference: AstraZeneca agreed to acquire CinCor Pharma for up to $1.8 billion, while Chiesi Farmaceutici agreed to shell out up to $1.48 billion cash for Amryt, and Ipsen Group said it will purchase Albireo Pharma for $952 million-plus.

Biopharmas generated about $88 billion in M&A deals in 2022, down 15% from $104 billion in 2021. The $88 billion accounted for most of the $135 billion in 124 deals in the life sciences. The number of biopharma deals fell 17%, to 75 deals from 90. The other 49 deals totaling $47 million consisted of transactions in “medtech,” which includes diagnostics developers and companies specializing in “virtual health” such as telemedicine. [EY]
EY—the professional services firm originally known as Ernst & Young—recently noted that the total value of biopharma M&A in 2022 was $88 billion, down 15% from $104 billion in 2021 [See Chart]. The $88 billion accounted for most of the $135 billion in 124 deals in the life sciences. That $135 billion figure is less than half the record-high $313 billion recorded in 2019, including $261 billion in 70 biopharma deals.

The number of biopharma deals fell 17% to 75 deals from 90. EY’s numbers include only deals greater than $100 million. The other 49 deals totaling $47 million consisted of transactions in “medtech,” which includes diagnostics developers and companies specializing in “virtual health” such as telemedicine.

We expect this to be a more active year as the sentiment starts to normalize a little bit,” Subin Baral, EY Global Life Sciences Deals Leader, told GEN Edge.

Baral is not alone in foreseeing a comeback for biopharma M&A.

John Newman, PhD, an analyst with Canaccord Genuity, predicted last week in a research note that biopharma companies will pursue a growing number of smaller cash deals in the range of $1 billion to $10 billion this year. He said rising interest rates are discouraging companies from taking on larger blockbuster deals that require buyers to take on larger sums of debt.

“We look for narrowing credit spreads and lower interest rates to encourage larger M&A ($50 billion and more) deals. We do not anticipate many $50B+ deals that could move the XBI +5%,” Newman said. (XBI is the SPDR S&P Biotech Electronic Transfer Fund, one of several large ETFs whose fluctuations reflect investor enthusiasm for biopharma stock.)

Newman added: “We continue to expect a biotech swell in 2023 that may become an M&A wave if credit conditions improve.”

Foreseeing larger deals than Newman and Canaccord Genuity is PwC, which in a commentary this month predicted: “Biotech deals in the $5–15 billion range will be prevalent and will require a different set of strategies and market-leading capabilities across the M&A cycle.”

Those capabilities include leadership within a specific therapeutic category, for which companies will have to buy and sell assets: “Prepared management teams that divest businesses that are subscale while doubling down on areas where leadership position and the right to win is tangible, may be positioned to deliver superior returns,” Glenn Hunzinger, PwC’s U.S. Pharma & Life Science Leader, and colleagues asserted.

The Right deals

Rising interest and narrowing credit partially explain the drop-off in deals during 2022, EY’s Baral said. Another reason was sellers adjusting to the drop in deal valuations that resulted from the decline of the markets which started late in 2021.

Subin Baral, EY Global Life Sciences Deals Leader

“It took a little bit longer to realize the reality of the market conditions on the seller side. But on the buyer side, the deals that they were looking at were not just simply a valuation issue. They were looking at the quality of the assets. And you can see that the quality deals—the right deals, as we call them—are still getting done,” Baral said.

The right deals, according to Baral, are those in which buyers have found takeover targets with a strong, credible management team, solid clinical data, and a clear therapeutic focus.

“Rare disease and oncology assets are still dominating the deal making, particularly oncology because your addressable market continues to grow,” Baral said. “Unfortunately, what that means is the patient population is growing too, so there’s this increased unmet need for that portfolio of assets.”

Several of 2022’s largest M&A deals fit into that “right” category, Baral said—including Amgen-Horizon, Pfizer’s $11.6-billion purchase of Biohaven Pharmaceuticals and the $6.7-billion purchase of Arena Pharmaceuticals (completed in March 2022); and Bristol-Myers Squibb’s $4.1-billion buyout of Turning Point Therapeutics.

“Quality companies are still getting funded one way or the other. So, while the valuation dropped, people were all expecting a flurry of deals because they are still companies with a shorter runway of cash that will be running to do deals. But that really didn’t happen from a buyer perspective,” Baral said. “The market moved a little bit from what was a seller’s market for a long time, to what we would like to think of as the pendulum swinging towards a buyers’ market.”

Most biopharma M&A deals, he said, will be “bolt-on” acquisitions in which a buyer aims to fill a gap in its clinical pipeline or portfolio of marketed drugs through purchases that account for less than 25% of a buyer’s market capitalization.

Baral noted that a growing number of biopharma buyers are acquiring companies with which they have partnered for several years on drug discovery and/or development collaborations. Pfizer acquired BioHaven six months after agreeing to pay the company up to $1.24 billion to commercialize rimegepant outside the U.S., where the migraine drug is marketed as Nurtec® ODT.

“There were already some kind of relationships there before these deals actually happened. But that also gives an indication that there are some insights to these targets ahead of time for these companies to feel increasingly comfortable, and pay the valuation that they’re paying for them,” Baral said.

$1.4 Trillion available

Baral sees several reasons for increased M&A activity in 2023. First, the 25 biopharma giants analyzed by EY had $1.427 trillion available as of November 30, 2022, for M&A in “firepower”—which EY defines as a company’s capacity to carry out M&A deals based on the strength of its balance sheet, specifically the amount of capital available for M&A deals from sources that include cash and equivalents, existing debt, and market cap.

That firepower is up 11% from 2021, and surpasses the previous record of $1.22 trillion in 2014, the first year that EY measured the available M&A capital of large biopharmas.

Unlike recent years, Baral said, biopharma giants are more likely to deploy that capital on M&A this year to close the “growth gap” expected to occur over the next five years as numerous blockbuster drugs lose patent exclusivity and face new competition from lower-cost generic drugs and biosimilars.

“There is not enough R&D in their pipeline to replenish a lot of their revenue. And this growth gap is coming between 2024 and 2026. So, they don’t have a long runway to watch and stay on the sidelines,” Baral said.

This explains buyers’ interest in replenishing pipelines with new and innovative treatments from smaller biopharmas, he continued. Many smaller biopharmas are open to being acquired because declining valuations and limited cash runways have increased investor pressure on them to exit via M&A. The decline of the capital markets has touched off dramatic slowdowns in two avenues through which biopharmas have gone public in recent years—initial public offerings (IPOs) and special purpose acquisition companies (SPACs).

EY recorded just 17 IPOs being priced in the U.S. and Europe, down 89% from 158 a year earlier. The largest IPO of 2022 was Prime Medicine’s initial offering, which raised $180.3 million in net proceeds for the developer of a “search and replace” gene editing platform.

Another 12 biopharmas agreed to SPAC mergers with blank-check companies, according to EY, with the largest announced transaction (yet to close at deadline) being the planned $899 million merger of cancer drug developer Apollomics with Maxpro Capital Acquisition.

“For the smaller players, the target biotech companies, their alternate source of access to capital pathways such as IPOs and SPACs is shutting down on them. So how would the biotech companies continue to fund themselves? Those with quality assets are still getting funded through venture capital or other forms of capital,” Baral said. “But in general, there is not a lot of appetite for the biotech that is taking that risk.

Figures from EY show a 37% year-to-year decline in the total value of U.S. and European VC deals, to $16.88 billion in 2022 from $26.62 billion in 2021. Late-stage financing rounds accounted for just 31% of last year’s VC deals, down from 34% in 2021 and 58% in 2012. The number of VC deals in the U.S. and Europe fell 18%, to 761 last year from 930 in 2021.

The decline in VC financing helps explain why many smaller biopharmas are operating with cash “runways” of less than 12 months. “Depending on the robustness of their data, their therapeutic area, and their management, there will be a natural attrition. Some of these companies will just have to wind down,” Baral added.

M&A headwinds

Baral also acknowledged some headwinds that are likely to dampen the pace of M&A activity. In addition to rising interest rates and inflation increasing the cost of capital, valuations remain high for the most sought-after drugs, platforms, and other assets—a result of growing and continuing innovation.

Another headwind is growing regulatory scrutiny of the largest deals. Illumina’s $8 billion purchase of cancer blood test developer Grail has faced more than two years of challenges from the U.S. Federal Trade Commission and especially the European Commission—while Congress acted last year to begin curbing the price of prescription drugs and insulin through the “Inflation Reduction Act.”

Those headwinds may prompt many companies to place greater strategic priority on collaborations and partnerships instead of M&A, Baral predicted, since they offer buyers early access to newer technologies before deciding whether to invest more capital through a merger or acquisition.

“Early-stage collaboration, early minority-stake investment becomes increasingly important, and it has been a cornerstone for early access to these technologies for the industry for a long, long time, and that is not changing any time soon,” Baral said. “On the other hand, even on the therapeutic area side, early-stage development is still expensive to do in-house for the large biopharma companies because of their cost structure.

“So, it is efficient cost-wise and speed-wise to buy these assets when they reach a certain point, which is probably at Phase II onward, and then you can pull the trigger on acquisitions if needed,” he added.

The post EY Eyes Comeback for Biopharma M&A appeared first on GEN - Genetic Engineering and Biotechnology News.

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IMF Upgrades Global Growth Forecast As Inflation Cools

IMF Upgrades Global Growth Forecast As Inflation Cools

The International Monetary Fund published its latest World Economic Outlook on Monday,…

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IMF Upgrades Global Growth Forecast As Inflation Cools

The International Monetary Fund published its latest World Economic Outlook on Monday, painting a slightly less gloomy picture than three and a half months ago, as inflation appears to have peaked in 2022, consumer spending remains robust and the energy crisis following Russia’s invasion of Ukraine has been less severe than initially feared.

But, as Statista's Felix Richter notes, that’s not to say the outlook is rosy, as the global economy still faces major headwinds.

However, the IMF predicts the slowdown to be less pronounced than previously anticipated.

Global growth is now expected to fall from 3.4 percent in 2022 to 2.9 percent this year, before rebounding to 3.1 percent in 2024.

The 2023 growth projection is up from an October estimate of 2.7 percent, as the IMF sees far fewer countries facing recession this year and does no longer anticipates a global downturn.

Infographic: IMF Upgrades Global Growth Forecast as Inflation Cools | Statista

You will find more infographics at Statista

One of the reasons behind the cautiously optimistic outlook is the latest downward trend in inflation, which suggests that inflation may have peaked in 2022.

The IMF predicts global inflation to cool to 6.6 percent in 2023 and 4.3 percent in 2024, which is still above pre-pandemic levels of about 3.5 percent, but significantly lower than the 8.8 percent observed in 2022.

“Economic growth proved surprisingly resilient in the third quarter of last year, with strong labor markets, robust household consumption and business investment, and better-than-expected adaptation to the energy crisis in Europe,” Pierre-Olivier Gourinchas, the IMF’s chief economist, wrote in a blog post released along with the report.

“Inflation, too, showed improvement, with overall measures now decreasing in most countries—even if core inflation, which excludes more volatile energy and food prices, has yet to peak in many countries.”

The risks to the latest outlook remain tilted to the downside, the IMF notes, as the war in Ukraine could further escalate, inflation continues to require tight monetary policies and China’s recovery from Covid-19 disruptions remains fragile. On the plus side, strong labor markets and solid wage growth could bolster consumer demand, while easing supply chain disruptions could help cool inflation and limit the need for more monetary tightening.

In conclusion, Gourinchas calls for multilateral cooperation to counter “the forces of geoeconomic fragmentation”.

“This time around, the global economic outlook hasn’t worsened,” he writes. “That’s good news, but not enough. The road back to a full recovery, with sustainable growth, stable prices, and progress for all, is only starting.”

However, just because the 'trend' has shifted doesn't mean it's mission accomplished...

That looks an awful lot like Central Bankers' nemesis remains - global stagflation curb stomps the dovish hopes.

Tyler Durden Tue, 01/31/2023 - 14:45

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Nike Escalates Design Battle Against Lululemon

The sportswear giant is accusing lululemon of patent infringement.

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The sportswear giant is accusing lululemon of patent infringement.

The Gucci loafers. The Burberry  (BBRYF) trench coat. When it comes to fashion, having a unique design is everything. This is why brands spend millions both creating and protecting their signature looks and the reason, as in the case of Adidas  (ADDDF) , extricating a brand's design from creators who behave badly is a costly and difficult process.

There is also the constant effort to release new styles without infringing on another group's style. This week, sportswear giant Nike  (NKE) - Get Free Report filed a lawsuit accusing lululemon  (LULU) - Get Free Report of infringing on its patents in the shoe line that the Vancouver-based activewear company launched last spring.

After years of selling exclusively clothing, accessories and the odd yoga mat, lululemon expanded into the world of footwear with a running shoe it dubbed Blissfeel last March. These were soon followed by training shoe and pool slide styles known as Chargefeel, Strongfeel -- all three of the designs (including a Chargefeel Low and a Chargefeel Mid design) have been mentioned in the lawsuit as causing "economic harm and irreparable injury" to Nike.

Nike's History Of Suing Lululemon Over Design

The specific issue lies in the technology used to build the shoes. According to the lawsuit filed in Manhattan federal court, certain knitted elements, webbing and tubular structures are too similar to ones that had been used by Nike earlier.

Nike is keeping the amount it hopes to receive from lululemon under wraps but is insisting the company infringed on its patent when releasing a shoe line too similar to its own. Lululemon had previously talked about how its shoe line "far exceeded" its leaders' expectations both in terms of sales and ability to expand.

In a Q1 earnings call, chief executive Calvin McDonald said that the line "definitely had a lot more demand than we anticipated."

Nike has already tried to go after lululemon through the courts once before. In January 2022, it accused the company of infringing on six patents over its at-home Mirror Home Gym. As the world emerged out of the pandemic, lululemon has been billing it as a hybrid model between at-home and in-person classes. 

The lawsuit was also filed in the U.S. District Court in Manhattan but ultimately fizzled out.

When it comes to the shoe line lawsuit, Lululemon has been telling media outlets that "Nike's claims are unjustified" and the company "look[s] forward to proving [their] case in court."

Lululemon

Some More Examples Of Prominent Design Battles

In the fashion industry, design infringement accusations are common and rarely lead to high-profile rulings. While Nike has gone after the technology itself in both cases, lawsuits more often focus on the style or pattern on a given piece.

Shein, a China-based fast-fashion company that took on longtime leaders like H&M  (HNNMY)  and Fast Retailing  (FRCOF) 's Uniqlo with its bottom-of-the-barrel pricing, has faced numerous allegations from smaller and independent designers over the copying of designs -- in some cases not even from fashion designers but artists painting in local communities.

"They didn't remotely bother trying to change anything," U.K.-based artist Vanessa Bowman told the Guardian after seeing her painting of a local church appear on a sweater on Shein's website. "The things I paint are my garden and my little village: it’s my life. And they’ve just taken my world to China and whacked it on an acrylic jumper."

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