1 00:00:05,800 --> 00:00:08,720 Speaker 1: Welcome to the Bloomberg pim L Podcast. I'm pim Fox. 2 00:00:08,760 --> 00:00:11,440 Speaker 1: Along with my co host Lisa A. Brahmowitz. Each day 3 00:00:11,480 --> 00:00:15,000 Speaker 1: we bring you the most important, noteworthy, and useful interviews 4 00:00:15,040 --> 00:00:17,520 Speaker 1: for you and your money, whether you're at the grocery 5 00:00:17,560 --> 00:00:20,560 Speaker 1: store or the trading floor. Find the Bloomberg p m 6 00:00:20,680 --> 00:00:33,320 Speaker 1: L Podcast on Apple Podcasts, SoundCloud, and Bloomberg dot com. 7 00:00:33,360 --> 00:00:38,280 Speaker 1: Well live by emerging markets and potentially die by emerging markets. 8 00:00:38,360 --> 00:00:42,440 Speaker 1: Damian sass Our, fixed income strategist for Bloomberg Intelligence, joins 9 00:00:42,520 --> 00:00:44,600 Speaker 1: us now to tell us all about how it is 10 00:00:44,640 --> 00:00:49,120 Speaker 1: the worst year since two thousand four for emerging market 11 00:00:49,240 --> 00:00:52,920 Speaker 1: box that was quick. Well, it's just a month ago 12 00:00:52,960 --> 00:00:55,280 Speaker 1: we were here talking about how great emerging market. That's 13 00:00:55,360 --> 00:00:58,840 Speaker 1: my point. And what happened in the last month at 14 00:00:58,840 --> 00:01:00,600 Speaker 1: the dollar, right, I mean we've and talking about the 15 00:01:00,640 --> 00:01:03,640 Speaker 1: dollar for so long, about dollar strength and how it's 16 00:01:03,680 --> 00:01:05,880 Speaker 1: just managed to be this one way street. And since 17 00:01:05,959 --> 00:01:11,000 Speaker 1: that's against the your right now, one thirty five against 18 00:01:11,000 --> 00:01:15,119 Speaker 1: the pounds sterling and one o nine against the Japanese. Yeah, him, 19 00:01:15,160 --> 00:01:17,080 Speaker 1: it's amazing. You know, everyone always looks at the G 20 00:01:17,200 --> 00:01:20,479 Speaker 1: three currency crosses, but it's China. I have to tell 21 00:01:20,480 --> 00:01:22,600 Speaker 1: you it's been the remnimbi that that is, that is 22 00:01:22,640 --> 00:01:24,759 Speaker 1: what's changed, right, I mean, for the past year, you've 23 00:01:24,760 --> 00:01:27,680 Speaker 1: seen the Chinese wand basically on a one way street 24 00:01:27,680 --> 00:01:30,520 Speaker 1: appreciating relative to the dollar. And that turned about a 25 00:01:30,520 --> 00:01:33,000 Speaker 1: month ago in mid April, and that's what drove everything here. 26 00:01:33,160 --> 00:01:36,160 Speaker 1: China dubbishness kind of crept in and people started to say, 27 00:01:36,160 --> 00:01:39,200 Speaker 1: we'll wait a second now, Um, maybe the PBSC is 28 00:01:39,200 --> 00:01:42,080 Speaker 1: gonna let the currency depreciate, and what does that mean 29 00:01:42,120 --> 00:01:43,839 Speaker 1: for the you know, what does that mean for the dollar? 30 00:01:43,920 --> 00:01:46,560 Speaker 1: And of course people woke up to the reality that well, 31 00:01:46,600 --> 00:01:48,160 Speaker 1: that's that's good for the dollar and that's bad for 32 00:01:48,200 --> 00:01:51,120 Speaker 1: you am. So just to sort of walk through the 33 00:01:51,160 --> 00:01:54,320 Speaker 1: logic here, typically when the dollar strengthens, that means all 34 00:01:54,320 --> 00:01:57,120 Speaker 1: of these developing nations that have borrowed a lot of 35 00:01:57,160 --> 00:02:01,040 Speaker 1: hard currency assets what a harder time paying back their debt. 36 00:02:01,360 --> 00:02:04,280 Speaker 1: Is that the main reason here, Well, that's one element 37 00:02:04,360 --> 00:02:06,560 Speaker 1: of it, right, I mean, you're obviously talking about all 38 00:02:06,600 --> 00:02:10,720 Speaker 1: of the emerging market UH borrowers who have issued dollar debt, 39 00:02:10,720 --> 00:02:13,600 Speaker 1: but their local government debt, you know, their local currency 40 00:02:13,680 --> 00:02:16,600 Speaker 1: debt is what the real killer here is because the 41 00:02:16,600 --> 00:02:19,040 Speaker 1: currency it's dominated in is no longer worth what it's 42 00:02:19,040 --> 00:02:22,359 Speaker 1: written on. So that is part of the issue. Now 43 00:02:22,480 --> 00:02:25,280 Speaker 1: here is the question, have we reached a point where 44 00:02:25,280 --> 00:02:28,320 Speaker 1: the sell off has escalated to such a degree that 45 00:02:28,440 --> 00:02:33,320 Speaker 1: people are coming in and buying buying opportunities. I'll tell 46 00:02:33,360 --> 00:02:35,600 Speaker 1: you what I mean by that. But the buying opportunities 47 00:02:35,600 --> 00:02:38,120 Speaker 1: that we've seen in EM debt have only been an 48 00:02:38,120 --> 00:02:41,080 Speaker 1: i M dollar debt, and they've only been idiosyncratic opportunities 49 00:02:41,120 --> 00:02:43,720 Speaker 1: in names like Tava, which had sold off significantly or 50 00:02:43,760 --> 00:02:46,760 Speaker 1: at a brash But certainly we have not seen new 51 00:02:46,800 --> 00:02:49,359 Speaker 1: money coming in and saying these are attractive levels we're 52 00:02:49,400 --> 00:02:52,480 Speaker 1: getting paid. You know, we're getting attractive yields, attractive carried 53 00:02:52,480 --> 00:02:54,840 Speaker 1: and i M dollar debt to go in at this stage, 54 00:02:54,840 --> 00:02:56,919 Speaker 1: we're not seeing that yet in factor seeing fund flows 55 00:02:56,960 --> 00:03:00,919 Speaker 1: accelerate of fund outflows accelerate right now. So I think 56 00:03:00,960 --> 00:03:02,799 Speaker 1: we still have a little bit of pain left left 57 00:03:02,800 --> 00:03:05,200 Speaker 1: ahead of us. But fundamentally e M is still you know, 58 00:03:05,240 --> 00:03:07,640 Speaker 1: in a relatively good place relative to where it's been 59 00:03:07,720 --> 00:03:10,880 Speaker 1: just in during the less paper uh and and another 60 00:03:11,000 --> 00:03:12,640 Speaker 1: you know kind of a venture of a you know, 61 00:03:12,680 --> 00:03:15,480 Speaker 1: sort of event risk elevated event risk environments, and so 62 00:03:15,919 --> 00:03:19,639 Speaker 1: you know, I think this is a correction that's long overdue. Um. 63 00:03:19,680 --> 00:03:21,600 Speaker 1: I think we gotta wait and see it play through. 64 00:03:22,080 --> 00:03:24,960 Speaker 1: I think, though, UM, the real interesting dynamic within emerging 65 00:03:25,000 --> 00:03:29,480 Speaker 1: market debt right now is local currency yields are actually 66 00:03:29,880 --> 00:03:32,680 Speaker 1: below and on a duration adjusted to basis, are about 67 00:03:32,720 --> 00:03:35,480 Speaker 1: to sink below em dollar yields for the first time 68 00:03:35,520 --> 00:03:38,320 Speaker 1: since the global financial crisis. So you are not getting 69 00:03:38,360 --> 00:03:40,720 Speaker 1: paid to go local in e M. And oh hey, 70 00:03:40,760 --> 00:03:45,600 Speaker 1: by the way, currency volatility is way more volatile than 71 00:03:45,800 --> 00:03:47,640 Speaker 1: than than e M dollar spreads, and that's a real 72 00:03:47,760 --> 00:03:52,680 Speaker 1: risk Argentina. Go ahead, that's not the punch line. That's 73 00:03:52,680 --> 00:03:57,640 Speaker 1: the question Argentina, so so blended yields uh in Argentina 74 00:03:57,720 --> 00:04:01,040 Speaker 1: right now dollar yields. So the risk here is do 75 00:04:01,160 --> 00:04:03,400 Speaker 1: we go out and try to, you know, take a 76 00:04:03,480 --> 00:04:06,520 Speaker 1: punt on getting a twenty pay out around UM in 77 00:04:06,640 --> 00:04:10,880 Speaker 1: Argentina dollar bonds with the currency risk and the currency 78 00:04:10,960 --> 00:04:13,840 Speaker 1: volatility that has just been absolutely off the charts. I mean, 79 00:04:13,880 --> 00:04:16,720 Speaker 1: I think it's down in the last three weeks since 80 00:04:16,720 --> 00:04:20,000 Speaker 1: we spoke last you know, I'm struck by and and 81 00:04:20,080 --> 00:04:23,040 Speaker 1: PIM you mentioned Argentina and This is a perfect segue. 82 00:04:23,320 --> 00:04:26,640 Speaker 1: It's not just Argentina. You have Turkey, you have the 83 00:04:26,640 --> 00:04:30,359 Speaker 1: Philippines raising rates in order to support their currency. You 84 00:04:30,400 --> 00:04:33,040 Speaker 1: have others as well. So yes, on a whole, perhaps 85 00:04:33,080 --> 00:04:35,200 Speaker 1: emerging markets are in a better position, which you have 86 00:04:35,320 --> 00:04:39,120 Speaker 1: these trouble spots that are very troubled spots with increasing trouble. 87 00:04:39,200 --> 00:04:41,800 Speaker 1: And I wonder, especially given the fact, as we've talked 88 00:04:41,880 --> 00:04:44,719 Speaker 1: many times before, how much money went in through indexed 89 00:04:44,800 --> 00:04:47,800 Speaker 1: strategies trying to get ahold of the entire complex of 90 00:04:47,800 --> 00:04:50,720 Speaker 1: emerging markets, how much just a couple of bad names 91 00:04:50,760 --> 00:04:54,760 Speaker 1: contained the reputation and cause a flood of withdrawals. Absolutely, 92 00:04:54,800 --> 00:04:56,400 Speaker 1: I mean this all begin with Russian and in many 93 00:04:56,440 --> 00:04:58,839 Speaker 1: respects this is really like as soon as Russia and 94 00:04:58,920 --> 00:05:01,080 Speaker 1: the sanctions on Russia, Russol and all that kind of 95 00:05:01,080 --> 00:05:03,360 Speaker 1: started to hit and people started to reevaluate. What We'll 96 00:05:03,360 --> 00:05:05,360 Speaker 1: wait a second here, the rubles now off ten percent? 97 00:05:05,640 --> 00:05:07,960 Speaker 1: What other countries are vulnerable? You know, what does this 98 00:05:08,000 --> 00:05:12,760 Speaker 1: mean for Turkey? What does this mean they actually have oil? Well, yeah, 99 00:05:12,800 --> 00:05:14,960 Speaker 1: you're right right, I mean a lot of countries don't 100 00:05:15,040 --> 00:05:17,800 Speaker 1: have that commodity base. You know, it's it's but what 101 00:05:17,960 --> 00:05:19,960 Speaker 1: we're so far off and by the time they actually 102 00:05:20,320 --> 00:05:22,040 Speaker 1: drive for some of that deep sea oil or gas 103 00:05:22,040 --> 00:05:24,440 Speaker 1: whatever is under the base. And I mean we might 104 00:05:24,480 --> 00:05:28,320 Speaker 1: be an electric powered economy. So we really can't you know, 105 00:05:28,360 --> 00:05:30,440 Speaker 1: we can't obviously model that in I think I think 106 00:05:30,480 --> 00:05:32,560 Speaker 1: for me and for what what we're looking at is, 107 00:05:33,400 --> 00:05:35,520 Speaker 1: you know, Argentina is a funny one, Pim. I mean, 108 00:05:35,760 --> 00:05:38,400 Speaker 1: you know, it's just come back online, it's a serial 109 00:05:38,440 --> 00:05:41,480 Speaker 1: default or it's got its own set of risks. But Turkey, 110 00:05:41,600 --> 00:05:43,359 Speaker 1: I think we're getting to a point here, you know, 111 00:05:43,360 --> 00:05:45,040 Speaker 1: where you have to you just have to take a 112 00:05:45,080 --> 00:05:46,640 Speaker 1: look at it. I mean, some of the yields I 113 00:05:46,640 --> 00:05:49,120 Speaker 1: mean are just you just have to take a look 114 00:05:49,120 --> 00:05:51,479 Speaker 1: at it, you know. And certainly Turkish financials, which I get. 115 00:05:51,600 --> 00:05:53,279 Speaker 1: You know, there's a lot of there's a lot of 116 00:05:53,279 --> 00:05:56,640 Speaker 1: negative narrative around guarantee and bank and and and all 117 00:05:56,680 --> 00:05:59,440 Speaker 1: that's going on in that sector. But I mean, you know, 118 00:05:59,720 --> 00:06:01,600 Speaker 1: some of those banks are bell Weather, some of them 119 00:06:01,640 --> 00:06:06,240 Speaker 1: are are you know, fundamentally healthy right now and um 120 00:06:06,320 --> 00:06:07,840 Speaker 1: and so you have to begin to look at those 121 00:06:07,920 --> 00:06:11,720 Speaker 1: at those opportunities. I can say, Tim, is it right here, Damien. 122 00:06:11,960 --> 00:06:19,200 Speaker 1: He has a very strong stomach to be recommended, saying 123 00:06:19,760 --> 00:06:23,960 Speaker 1: fields are very high, they are high fial. Look, you 124 00:06:24,000 --> 00:06:28,359 Speaker 1: know there's this. We have an election coming up in Mexico. Yeah. Uh, 125 00:06:28,400 --> 00:06:31,800 Speaker 1: and uh. The Mexican economy, at least the government part 126 00:06:31,800 --> 00:06:34,800 Speaker 1: of the economy, depends a lot on oil revenue. The 127 00:06:34,920 --> 00:06:38,880 Speaker 1: leader in the polls is basically saying we don't want 128 00:06:39,040 --> 00:06:42,279 Speaker 1: foreign investment in the oil economy. Yeah. Yeah, Now, I 129 00:06:42,279 --> 00:06:44,599 Speaker 1: mean that is a risk, right, I mean, um am 130 00:06:44,640 --> 00:06:46,760 Speaker 1: Loo is definitely leading in the polls, and for all 131 00:06:46,800 --> 00:06:48,599 Speaker 1: intents and purposes, he is probably gonna be there. But 132 00:06:48,640 --> 00:06:50,919 Speaker 1: I do I I'm not going to recommend it. But 133 00:06:51,040 --> 00:06:53,200 Speaker 1: one area that does look rather attractive. And I'll tell 134 00:06:53,200 --> 00:06:55,920 Speaker 1: you why. Our Mexican high grade debt short duration. And 135 00:06:56,440 --> 00:06:58,440 Speaker 1: that's like an America Movil or a Televisa. And the 136 00:06:58,480 --> 00:07:02,000 Speaker 1: reason I say that is Mexico tends to track, especially 137 00:07:02,000 --> 00:07:05,240 Speaker 1: in Mexican dollar debt tends to track US debt, right, 138 00:07:05,320 --> 00:07:07,840 Speaker 1: US high grade debt and US high grade debt. I mean, 139 00:07:07,880 --> 00:07:09,880 Speaker 1: with the front end of the curve kind of ratcheting 140 00:07:09,960 --> 00:07:12,360 Speaker 1: up here, I mean, you've got some attractive yields now 141 00:07:12,360 --> 00:07:14,960 Speaker 1: and names that were you know, I mean, you just couldn't. 142 00:07:14,960 --> 00:07:16,760 Speaker 1: You couldn't invest in it before because you just weren't 143 00:07:16,800 --> 00:07:18,800 Speaker 1: getting paid to own American mobile bonds, and now you 144 00:07:18,840 --> 00:07:21,800 Speaker 1: are and short duration American mobile bonds. So I think 145 00:07:21,840 --> 00:07:24,960 Speaker 1: in some pockets of the market, Brazilian financials, for example, 146 00:07:24,960 --> 00:07:27,320 Speaker 1: Brazilian has one of the steepest yield curves out there. 147 00:07:27,360 --> 00:07:29,920 Speaker 1: So you think, you know, steep yiel curve is good 148 00:07:29,920 --> 00:07:32,640 Speaker 1: for for the financial sector. And it's also short duration debt, right, 149 00:07:32,680 --> 00:07:34,800 Speaker 1: because I mean, that's that's the buzz, right, you want 150 00:07:34,800 --> 00:07:37,320 Speaker 1: to go short duration, and so that's another area you 151 00:07:37,320 --> 00:07:38,880 Speaker 1: may want to take a look at as well. It's 152 00:07:38,920 --> 00:07:42,360 Speaker 1: how Bradesco some some banks there that might might look 153 00:07:42,400 --> 00:07:46,440 Speaker 1: pretty interesting at these levels. Amazing, really really interesting. Damian Sassare, 154 00:07:46,520 --> 00:07:49,120 Speaker 1: thank you so much for being with us. Damian sassaur 155 00:07:49,360 --> 00:07:52,520 Speaker 1: It talked about how a month ago it all looked different, 156 00:07:52,560 --> 00:07:56,360 Speaker 1: but not to him back to back in a month 157 00:07:56,360 --> 00:08:00,640 Speaker 1: and it will be completely different. You get to his chair. 158 00:08:01,160 --> 00:08:04,800 Speaker 1: Fixing Cup strategist at Bloomberg Intelligence, joining us here at 159 00:08:04,800 --> 00:08:09,320 Speaker 1: the Bloomberg World count Quarters thirty Lexington. We are broadcasting 160 00:08:09,520 --> 00:08:13,360 Speaker 1: live from Bloomberg's Business of Equality Summit, bringing together business 161 00:08:13,440 --> 00:08:16,720 Speaker 1: leaders and thinkers to talk about how to make the 162 00:08:16,800 --> 00:08:35,600 Speaker 1: workplace a better, more equal, and comfortable place for everybody. 163 00:08:37,040 --> 00:08:39,760 Speaker 1: We are broadcasting from Bloomberg Business of Equality Summit in 164 00:08:39,840 --> 00:08:43,199 Speaker 1: New York City are corporate headquarters. We bring together business, 165 00:08:43,280 --> 00:08:46,160 Speaker 1: academic and political leaders, as well as the leaders of 166 00:08:46,200 --> 00:08:49,480 Speaker 1: nonprofits to talk about changes in the world of business 167 00:08:49,520 --> 00:08:53,480 Speaker 1: and equality and diversity. Joining us now is Elizabeth A. 168 00:08:53,600 --> 00:08:57,120 Speaker 1: Yama Yaro, a senior advisor to the Under Secretary General 169 00:08:57,160 --> 00:09:01,280 Speaker 1: and Executive Director of the United Nations for You and Women. 170 00:09:01,360 --> 00:09:03,160 Speaker 1: She's also the global head of the u n S 171 00:09:03,200 --> 00:09:07,800 Speaker 1: He for She Movement and you can follow her on 172 00:09:07,840 --> 00:09:11,920 Speaker 1: Twitter at e Underscore Yama Yarrow. But there is an 173 00:09:12,040 --> 00:09:14,600 Speaker 1: end before that. Um Elizabeth, thank you very much for 174 00:09:14,640 --> 00:09:16,839 Speaker 1: being with us. Tell us what is the Heat for 175 00:09:17,040 --> 00:09:21,720 Speaker 1: She movement? It is the global solidarity movement for gender 176 00:09:21,720 --> 00:09:24,679 Speaker 1: equality that was set up three years ago to engage 177 00:09:24,720 --> 00:09:27,520 Speaker 1: men and boys as part of the solution. So we 178 00:09:27,559 --> 00:09:31,800 Speaker 1: are waking at grassroot level, but also working with global companies, 179 00:09:32,040 --> 00:09:36,520 Speaker 1: global CEOs, heads or states academia to create tangible solutions 180 00:09:36,520 --> 00:09:41,640 Speaker 1: for gender equality. So how much does war impede these uh, 181 00:09:41,840 --> 00:09:44,360 Speaker 1: these issues that you're focusing on, Because if I think 182 00:09:44,400 --> 00:09:47,760 Speaker 1: about gender equality, I think about equal pay, but then 183 00:09:47,800 --> 00:09:49,719 Speaker 1: I also think about the reports that we hear out 184 00:09:49,720 --> 00:09:53,720 Speaker 1: of Syria or other places where there is war and 185 00:09:53,880 --> 00:09:56,360 Speaker 1: women are getting raped and killed, or India for example. 186 00:09:56,640 --> 00:09:59,920 Speaker 1: So talked a little bit about that this is actually 187 00:10:00,040 --> 00:10:02,400 Speaker 1: one of the crisis of our time, the issue of 188 00:10:02,440 --> 00:10:05,320 Speaker 1: gender inequality, because when you look at every single level 189 00:10:05,320 --> 00:10:09,960 Speaker 1: of society is socially, economically, politically, women are not doing well. Uh, 190 00:10:10,000 --> 00:10:13,320 Speaker 1: there's lack of representation, but there's also abuse. Um the 191 00:10:13,400 --> 00:10:16,240 Speaker 1: issue of violence that you mentioned. Globally, one in three 192 00:10:16,280 --> 00:10:18,840 Speaker 1: women will be subject to violence in their lifetime. That's 193 00:10:18,920 --> 00:10:22,000 Speaker 1: one billion women working around wounded. So the issues of 194 00:10:22,000 --> 00:10:24,840 Speaker 1: gender equality really we're in a crisis moment and we've 195 00:10:24,840 --> 00:10:27,120 Speaker 1: got to figure out a where that we can you know, 196 00:10:27,160 --> 00:10:30,080 Speaker 1: support women and girls and and really create tree equality 197 00:10:30,120 --> 00:10:33,520 Speaker 1: in these societies. Can you just offer an example of 198 00:10:33,640 --> 00:10:37,640 Speaker 1: one of the experiences for the He for She movements 199 00:10:37,679 --> 00:10:41,200 Speaker 1: something that has actually taken place. The biggest achievement that 200 00:10:41,280 --> 00:10:45,000 Speaker 1: we've done is to create this initiative called the Impact Initiative, 201 00:10:45,040 --> 00:10:48,200 Speaker 1: where we engage ten heads of states from the Prime 202 00:10:48,240 --> 00:10:53,640 Speaker 1: Prime Minister of Japan, Prime Minister of Canada, to Wander Malawi, 203 00:10:54,040 --> 00:10:58,120 Speaker 1: um to the Scandinavian countries and also global CEOs, whether 204 00:10:58,200 --> 00:11:00,560 Speaker 1: it be the chairman of PwC. We was just with 205 00:11:00,679 --> 00:11:03,760 Speaker 1: on a panel today at the Bloomberg Summit um too, 206 00:11:04,040 --> 00:11:06,480 Speaker 1: you know, UNI Live, et cetera. But the biggest thing 207 00:11:06,640 --> 00:11:10,640 Speaker 1: that these champions are doing is they have identified critical 208 00:11:10,760 --> 00:11:13,840 Speaker 1: policy areas that they are going to literally achieve parity 209 00:11:14,000 --> 00:11:16,920 Speaker 1: on by twenty So if you look at p w say, 210 00:11:16,960 --> 00:11:19,640 Speaker 1: we're here today talking about how the company have been 211 00:11:19,679 --> 00:11:22,920 Speaker 1: able to move the data point in their global leadership 212 00:11:22,920 --> 00:11:25,440 Speaker 1: team from eighteen percent in twenty fifteen when they joined 213 00:11:25,440 --> 00:11:29,480 Speaker 1: the here Foreshen movement to for within fifteen months. So 214 00:11:29,559 --> 00:11:32,240 Speaker 1: who has been the least receptive of the world leaders 215 00:11:32,240 --> 00:11:36,160 Speaker 1: who you've spoken to? We again, here for shas an 216 00:11:37,080 --> 00:11:39,280 Speaker 1: open invitation to those that want to be on the 217 00:11:39,320 --> 00:11:41,360 Speaker 1: rest side of history. And so what we've done was 218 00:11:41,400 --> 00:11:43,960 Speaker 1: to really issue core to action and we ended up 219 00:11:43,960 --> 00:11:45,640 Speaker 1: with those leaders that actually want to be part of 220 00:11:45,679 --> 00:11:49,439 Speaker 1: the change. So who is notably absent? I don't think 221 00:11:49,480 --> 00:11:52,240 Speaker 1: I can single out anyone. It is a pilot initiative. 222 00:11:52,320 --> 00:11:56,840 Speaker 1: So we started with ten countries in terms of governments, 223 00:11:56,920 --> 00:11:59,440 Speaker 1: and the ten companies the countries that came to us. 224 00:12:00,000 --> 00:12:03,400 Speaker 1: I've really defined some concrete change. Malawi is on. You know, 225 00:12:03,480 --> 00:12:05,520 Speaker 1: they have now outlawed child marriage as part of the 226 00:12:05,559 --> 00:12:09,160 Speaker 1: Heathshire Commitment. In a spece of twelve months, the chiefs, 227 00:12:09,160 --> 00:12:11,880 Speaker 1: the male chiefs in Malawi worked with the female chiefs 228 00:12:11,920 --> 00:12:14,040 Speaker 1: and went around and are now more than three thousand, 229 00:12:14,080 --> 00:12:16,480 Speaker 1: five hundred child marriages and these girls are now back 230 00:12:16,520 --> 00:12:18,800 Speaker 1: in school. So we are seeing that those those who 231 00:12:18,880 --> 00:12:21,000 Speaker 1: want to build the rest sort of history are doing 232 00:12:21,000 --> 00:12:23,959 Speaker 1: something very concrete and very inspiring. Can you talk a 233 00:12:24,000 --> 00:12:26,400 Speaker 1: little bit about your own background and how you came 234 00:12:26,520 --> 00:12:29,760 Speaker 1: to be part of this UN initiative. I grew up 235 00:12:29,760 --> 00:12:32,720 Speaker 1: in a tiny village in Zimbabwe and when I was 236 00:12:32,760 --> 00:12:35,559 Speaker 1: eight years old, the United Nations came into my village. 237 00:12:35,600 --> 00:12:38,400 Speaker 1: We're going through one of our West drought and I 238 00:12:38,440 --> 00:12:40,560 Speaker 1: was starving. I had not eaten for several days and 239 00:12:40,640 --> 00:12:43,680 Speaker 1: literally the UN saved my life. A young woman who 240 00:12:43,800 --> 00:12:47,160 Speaker 1: happened to be Zimbabwe but worked for UNI SEV found 241 00:12:47,200 --> 00:12:49,320 Speaker 1: me underneath the street, give me a ball of hom 242 00:12:49,360 --> 00:12:51,680 Speaker 1: porridge and literally, you know, I survived. And I knew 243 00:12:51,720 --> 00:12:54,480 Speaker 1: from that early young age that I wanted to work 244 00:12:54,480 --> 00:12:56,480 Speaker 1: for the U n and so I pursued that vision 245 00:12:56,520 --> 00:12:58,600 Speaker 1: and have now been with the UN for fifteen years, 246 00:12:59,240 --> 00:13:03,280 Speaker 1: working for different entities from UNA's in Geneva who I've 247 00:13:03,280 --> 00:13:05,320 Speaker 1: also worked at the World Bank, and now I'm with 248 00:13:05,440 --> 00:13:07,760 Speaker 1: You and Women as the senior advisor to the under 249 00:13:07,840 --> 00:13:11,080 Speaker 1: Sector General. So how young were you when you loved Zimbabwe? 250 00:13:11,559 --> 00:13:15,280 Speaker 1: So I left Simbabwe in my early twenties, moved to 251 00:13:15,280 --> 00:13:18,160 Speaker 1: the United Nations with two fifty pounds to my name, 252 00:13:18,160 --> 00:13:20,800 Speaker 1: with not friends or family. I had my dream though, 253 00:13:20,880 --> 00:13:24,120 Speaker 1: to become this young girl who worked for the United Nations, 254 00:13:24,200 --> 00:13:27,280 Speaker 1: wore a blue uniform, and I ended up, you know, 255 00:13:27,320 --> 00:13:30,720 Speaker 1: studying political science and the London School of Economics. And 256 00:13:30,720 --> 00:13:32,839 Speaker 1: and here we are well, thank you so much for 257 00:13:32,920 --> 00:13:35,679 Speaker 1: joining us. So really fascinating to speak with you, and 258 00:13:36,120 --> 00:13:38,319 Speaker 1: we will she the best of luck in the initiative. 259 00:13:38,760 --> 00:13:42,479 Speaker 1: Elizabeth Yummy Yarrow is Senior Advisor to the Under Secretary 260 00:13:42,520 --> 00:13:45,400 Speaker 1: General and executive director of You and Women. She is 261 00:13:45,440 --> 00:13:49,520 Speaker 1: also the global head for You and He for SHE movement. 262 00:13:49,600 --> 00:13:53,040 Speaker 1: She is joining us here from the Bloomberg Business of 263 00:13:53,080 --> 00:13:58,120 Speaker 1: Equality Summit in our seven thirty Lexington Avenue headquarters here 264 00:13:58,480 --> 00:14:02,720 Speaker 1: in New York. Really interesting, and it's definitely interesting to 265 00:14:02,760 --> 00:14:04,520 Speaker 1: hear about all of the different challenges and sort of 266 00:14:04,640 --> 00:14:08,960 Speaker 1: uniting thread between them all through different nations and different challenges. 267 00:14:23,880 --> 00:14:26,280 Speaker 1: They're sort of a disconnect in Silicon Valley where you 268 00:14:26,320 --> 00:14:30,680 Speaker 1: think of a sort of socially progressive and liberal attitude, 269 00:14:31,040 --> 00:14:34,280 Speaker 1: while the pay gap between the genders has widened and 270 00:14:34,440 --> 00:14:37,520 Speaker 1: there's talk of the Broo topia. The Emily Chang of 271 00:14:37,520 --> 00:14:40,400 Speaker 1: Bloomberg Television wrote about here to talk about how to 272 00:14:40,440 --> 00:14:43,280 Speaker 1: make the tech world perhaps a little bit more equal 273 00:14:43,640 --> 00:14:46,120 Speaker 1: is a Neil dash He is chief executive of fog 274 00:14:46,240 --> 00:14:49,280 Speaker 1: Creek Software in New York. He also was an advisor 275 00:14:49,320 --> 00:14:52,600 Speaker 1: to the Obama White House's Office of Digital Strategy. We're 276 00:14:52,640 --> 00:14:54,280 Speaker 1: so glad that you could join us. Thank you for 277 00:14:54,360 --> 00:14:57,400 Speaker 1: being here. So what is sort of at the root 278 00:14:57,720 --> 00:15:01,280 Speaker 1: of this inequality that persists between the genders even in 279 00:15:01,320 --> 00:15:03,680 Speaker 1: Silicon Value. You know, there's there's a lot of good intention, 280 00:15:03,720 --> 00:15:06,880 Speaker 1: as you said, and then there is the self reflection 281 00:15:07,280 --> 00:15:09,560 Speaker 1: and the challenge of changing yourself and saying what am 282 00:15:09,560 --> 00:15:11,920 Speaker 1: I doing wrong? Is it just thinking the right things 283 00:15:12,000 --> 00:15:15,960 Speaker 1: enough to get it done? And then there is I 284 00:15:15,960 --> 00:15:19,040 Speaker 1: think the slightly more legitimate excuses we're moving a breakneck speed. 285 00:15:19,400 --> 00:15:22,800 Speaker 1: Everything is changing really rapidly. I'll get to fixing all 286 00:15:22,800 --> 00:15:25,600 Speaker 1: this social stuff once everything is settled down. Of course, 287 00:15:25,600 --> 00:15:27,960 Speaker 1: there is no settling down at tech, and so they 288 00:15:28,200 --> 00:15:29,720 Speaker 1: sort of, you know, kick the can down the road 289 00:15:29,800 --> 00:15:32,560 Speaker 1: a lot, and that's that's the most charitable interpretation. And 290 00:15:32,600 --> 00:15:34,560 Speaker 1: then we have people that that say they care and 291 00:15:34,600 --> 00:15:36,440 Speaker 1: just don't you know, which is one of those things 292 00:15:36,480 --> 00:15:38,240 Speaker 1: that we have to reckon with as an industry. I 293 00:15:38,240 --> 00:15:40,720 Speaker 1: think all those things combining together to close off a 294 00:15:40,760 --> 00:15:43,400 Speaker 1: lot of opportunity, um, you know, for the for the 295 00:15:43,400 --> 00:15:45,600 Speaker 1: companies that aren't involving in that way. In our case, 296 00:15:45,640 --> 00:15:49,080 Speaker 1: we're small independent company. Um we we we build a 297 00:15:49,080 --> 00:15:51,160 Speaker 1: cycle called Flitch, which is like a YouTube for coders. 298 00:15:51,160 --> 00:15:54,680 Speaker 1: So we're competing for talent with Facebook, with Google. Um 299 00:15:54,800 --> 00:15:56,480 Speaker 1: by us being able to plan a flag and say 300 00:15:56,480 --> 00:16:00,000 Speaker 1: we're really going to stand on you know, meaningful measures 301 00:16:00,440 --> 00:16:03,680 Speaker 1: that push for equity and push for inclusion, that's been 302 00:16:03,680 --> 00:16:06,200 Speaker 1: a competitive advantage for us, Even things like simply doing 303 00:16:06,200 --> 00:16:08,880 Speaker 1: salary transparency where people know what their salary is going 304 00:16:08,920 --> 00:16:10,400 Speaker 1: to be when we hire them. That opens the door 305 00:16:10,440 --> 00:16:13,480 Speaker 1: to us attracting talent that others can and Neil, could 306 00:16:13,480 --> 00:16:15,440 Speaker 1: you just describe a little bit of your background in 307 00:16:15,520 --> 00:16:18,960 Speaker 1: the world of blogging, so pea understand how you came 308 00:16:19,120 --> 00:16:22,640 Speaker 1: to be, I believe one of the few people that 309 00:16:22,720 --> 00:16:27,880 Speaker 1: could count prints as well as Bill Gates among their 310 00:16:28,280 --> 00:16:30,600 Speaker 1: at least their previous followers. Yeah. Yeah, it's a it's 311 00:16:30,600 --> 00:16:32,440 Speaker 1: a very um you know, social media used to be 312 00:16:32,480 --> 00:16:35,000 Speaker 1: a small world, right, So I started blogging twenty years ago, 313 00:16:35,560 --> 00:16:38,200 Speaker 1: and you had to be fairly interested in both technology 314 00:16:38,200 --> 00:16:41,280 Speaker 1: and media at that point to do both. And so, um, 315 00:16:41,360 --> 00:16:43,040 Speaker 1: you know, I've been making software. You know, we had 316 00:16:43,080 --> 00:16:45,400 Speaker 1: the back then it was you know, Windows ninety eight 317 00:16:45,480 --> 00:16:47,920 Speaker 1: or whatever it was. Yeah, this sort of um, conventional 318 00:16:47,920 --> 00:16:51,400 Speaker 1: software industry. But the age six apart was was you Yeah, yeah, 319 00:16:51,400 --> 00:16:53,200 Speaker 1: I was the first employee there, and we made tools 320 00:16:53,240 --> 00:16:55,520 Speaker 1: like movable type, which was one of the early blogging tools, 321 00:16:55,920 --> 00:16:58,000 Speaker 1: and um, and people took that and used that to 322 00:16:58,080 --> 00:17:00,280 Speaker 1: make huffing and post or to make gawk, or to 323 00:17:00,360 --> 00:17:02,600 Speaker 1: make all these sort of you know, really prominent early 324 00:17:02,680 --> 00:17:05,359 Speaker 1: media sites. And like I said, you were combining technology 325 00:17:05,359 --> 00:17:07,840 Speaker 1: and media. And you know, in Bloomberg that might be 326 00:17:07,880 --> 00:17:10,359 Speaker 1: pretty obvious that a lot of other places it wasn't. 327 00:17:10,520 --> 00:17:13,359 Speaker 1: And um, and so that was one of those moments 328 00:17:13,359 --> 00:17:17,040 Speaker 1: where we realized what in retrospect became social media would 329 00:17:17,080 --> 00:17:19,840 Speaker 1: be the thing that defined technology to people even more 330 00:17:19,960 --> 00:17:22,800 Speaker 1: than uh, you know, using a spreadsheet program or something 331 00:17:22,840 --> 00:17:24,639 Speaker 1: like that. And so out of that that sort of 332 00:17:24,680 --> 00:17:26,679 Speaker 1: community of people that were paying attention that came a 333 00:17:26,720 --> 00:17:29,320 Speaker 1: lot of the early social network and social media platforms, 334 00:17:29,520 --> 00:17:31,000 Speaker 1: as well as a lot of the sort of big 335 00:17:31,040 --> 00:17:33,280 Speaker 1: innovators and adventures that I think have gone on to 336 00:17:33,320 --> 00:17:37,159 Speaker 1: become household names. Does does it ever cause you some 337 00:17:37,240 --> 00:17:42,359 Speaker 1: kind of irony that the social media explosion has come 338 00:17:42,359 --> 00:17:47,679 Speaker 1: back to create I don't want to say a social media, 339 00:17:47,920 --> 00:17:51,160 Speaker 1: but certainly social media where you don't know who's behind 340 00:17:51,640 --> 00:17:54,320 Speaker 1: the information, you don't know what their agenda is, and 341 00:17:54,359 --> 00:17:56,680 Speaker 1: there's very little way in which you can track it 342 00:17:56,720 --> 00:17:59,080 Speaker 1: and hold people accountable. Yeah, there were, you know, there 343 00:17:59,080 --> 00:18:03,200 Speaker 1: were a lot of maybe faulty assumptions is one way 344 00:18:03,200 --> 00:18:05,440 Speaker 1: to put it, or even just sort of shortsighted assumptions 345 00:18:05,440 --> 00:18:08,080 Speaker 1: about how the systems were designed, you know, the the 346 00:18:08,160 --> 00:18:10,959 Speaker 1: idea when you're building tools. In two thousand or two 347 00:18:10,960 --> 00:18:13,359 Speaker 1: thousand five or two thousand and six on Twitter launched 348 00:18:13,760 --> 00:18:15,560 Speaker 1: that maybe a billion people would show up and use 349 00:18:15,560 --> 00:18:18,240 Speaker 1: your tool would be absurd. So so this idea that 350 00:18:18,280 --> 00:18:20,040 Speaker 1: they were going to design to anticipate that was a 351 00:18:20,080 --> 00:18:22,800 Speaker 1: little unexpected. I think what became of that was assuming 352 00:18:22,840 --> 00:18:24,560 Speaker 1: everybody who's gonna be part of the same community is 353 00:18:24,640 --> 00:18:27,520 Speaker 1: part of the same clique. Didn't anticipate the values everybody had, 354 00:18:27,520 --> 00:18:31,639 Speaker 1: didn't anticipate building accountability for everyone. So given that, and 355 00:18:31,680 --> 00:18:35,199 Speaker 1: given where the social media world has come from, do 356 00:18:35,240 --> 00:18:39,560 Speaker 1: you think that Facebook and uh it's rivals have adequately 357 00:18:39,560 --> 00:18:42,399 Speaker 1: addressed some of these security concerns as well as some 358 00:18:42,480 --> 00:18:45,679 Speaker 1: of the social concerns. Uh No, you know, there's so 359 00:18:45,760 --> 00:18:47,879 Speaker 1: much more to do. And and this actually goes to 360 00:18:47,880 --> 00:18:50,560 Speaker 1: the earlier point about inclusion in the industry. If if 361 00:18:50,600 --> 00:18:52,919 Speaker 1: more of the people in power at Facebook and these 362 00:18:52,920 --> 00:18:55,760 Speaker 1: other companies where the people that get targeted and harassed 363 00:18:55,760 --> 00:18:59,600 Speaker 1: online or to get marginalized by these technologies, I think 364 00:18:59,640 --> 00:19:02,760 Speaker 1: you would see very different designs and very different prioritizations 365 00:19:02,800 --> 00:19:04,919 Speaker 1: other products. I think they're starting to reckon with it. 366 00:19:04,920 --> 00:19:06,159 Speaker 1: I mean, there are a ton of good people at 367 00:19:06,160 --> 00:19:07,960 Speaker 1: these companies and they want to do the right thing. 368 00:19:08,400 --> 00:19:10,560 Speaker 1: But it's a lot easier to prevent than it is 369 00:19:10,600 --> 00:19:13,320 Speaker 1: to try and cure after the harms have already been caused. 370 00:19:13,560 --> 00:19:15,280 Speaker 1: That's what I was going to ask, is it's one 371 00:19:15,320 --> 00:19:18,040 Speaker 1: thing to go and consciously try to be diverse, But 372 00:19:18,240 --> 00:19:20,800 Speaker 1: isn't there some kind of business advantage have you found 373 00:19:21,280 --> 00:19:23,800 Speaker 1: to hiring people with different points of view? Yeah? Yeah, 374 00:19:23,800 --> 00:19:26,879 Speaker 1: I mean you you end up with them anticipating uh, 375 00:19:26,920 --> 00:19:29,080 Speaker 1: you know, flaws or weaknesses. And I look at this 376 00:19:29,119 --> 00:19:31,800 Speaker 1: as sort of um, you know, and and the conventional 377 00:19:31,840 --> 00:19:33,919 Speaker 1: tech industry that things that everybody pays attention to our 378 00:19:34,400 --> 00:19:38,199 Speaker 1: security scalability issues like that, and you always anticipate it. 379 00:19:38,200 --> 00:19:39,760 Speaker 1: You sort of say, this is the next area where 380 00:19:39,800 --> 00:19:43,040 Speaker 1: we're gonna have to anticipate an area of vulnerability. I 381 00:19:43,040 --> 00:19:45,280 Speaker 1: look at the same thing with culture. Culture debt is 382 00:19:45,320 --> 00:19:48,000 Speaker 1: just like technical debt. It's something that you um one 383 00:19:48,000 --> 00:19:50,480 Speaker 1: way or another. You're gonna pay right one way or another. 384 00:19:50,480 --> 00:19:53,480 Speaker 1: You're gonna have to address these things that you were 385 00:19:53,520 --> 00:19:56,960 Speaker 1: shortsighted on or that you underinvested in. Why not be preventative. 386 00:19:57,240 --> 00:19:59,520 Speaker 1: I look at it as you know, it's the right 387 00:19:59,520 --> 00:20:01,800 Speaker 1: thing to do morally and ethically, that's where it starts. 388 00:20:02,040 --> 00:20:04,280 Speaker 1: But it's also a great way to manage risk as 389 00:20:04,359 --> 00:20:07,920 Speaker 1: a company that's, you know, really operating extremely competitive environment. 390 00:20:08,400 --> 00:20:10,240 Speaker 1: Let's reduce our risk and increase the odds that we're 391 00:20:10,240 --> 00:20:12,520 Speaker 1: gonna be able to compete against these giant players. I 392 00:20:12,560 --> 00:20:14,240 Speaker 1: want to thank you very much for joining us. You're 393 00:20:14,240 --> 00:20:16,480 Speaker 1: gonna be blogging about this right absolutely and tweeting about 394 00:20:16,520 --> 00:20:18,919 Speaker 1: it too. Well done. Thanks very much. That she is 395 00:20:18,920 --> 00:20:22,480 Speaker 1: the chief executive of fog Creek, a software one of 396 00:20:22,480 --> 00:20:25,439 Speaker 1: the many attendees here at the Business of Equality Summit 397 00:20:26,119 --> 00:20:29,840 Speaker 1: at our New York City corporate headquarters and brings together 398 00:20:29,880 --> 00:20:33,040 Speaker 1: a variety of business, academic and nonprofit leaders to talk 399 00:20:33,080 --> 00:20:51,119 Speaker 1: about equality and diversity in the workplace. A sixty two 400 00:20:51,400 --> 00:20:56,000 Speaker 1: billion dollar bet on orphan drugs to treat diseases such 401 00:20:56,040 --> 00:20:59,879 Speaker 1: as Hunter's syndrome. That's the case of Takeda Pharmaceuticals and 402 00:21:00,080 --> 00:21:04,000 Speaker 1: it's sixty two billion dollar deal to acquire Shire. Here 403 00:21:04,000 --> 00:21:07,359 Speaker 1: to tell us more is Max Neeson, biotech, parma and 404 00:21:07,440 --> 00:21:11,520 Speaker 1: healthcare columnist for Bloomberg Opinion. You can follow Max on 405 00:21:11,560 --> 00:21:15,840 Speaker 1: Twitter at Max Neeson nets and I S. E. N. Max. 406 00:21:16,240 --> 00:21:22,080 Speaker 1: Why is Takeda spending sixty two billion dollars on Shire? Well, 407 00:21:22,119 --> 00:21:25,240 Speaker 1: I think they're really desperate for for some combination of 408 00:21:25,480 --> 00:21:29,840 Speaker 1: geographic and and drug diversification. Uh, they're pretty heavily dependent 409 00:21:29,920 --> 00:21:33,639 Speaker 1: on on some older treatments themselves, nothing much in the pipeline, 410 00:21:33,960 --> 00:21:36,880 Speaker 1: and also on the Japanese market, which is particularly tough 411 00:21:37,440 --> 00:21:40,119 Speaker 1: for drug makers given that they have some pretty aggressive 412 00:21:40,640 --> 00:21:43,560 Speaker 1: price controls at times. So they were just looking for 413 00:21:43,600 --> 00:21:46,520 Speaker 1: a way to supplement their pipeline, get into the United 414 00:21:46,560 --> 00:21:49,960 Speaker 1: States to a greater degree, and also um get into 415 00:21:50,000 --> 00:21:52,400 Speaker 1: the rare disease drug market, as you mentioned. So let's 416 00:21:52,400 --> 00:21:56,320 Speaker 1: talk price. This sixty two billion dollar price tag includes 417 00:21:56,560 --> 00:21:59,679 Speaker 1: a thirty one billion dollar bridge loan that makes it 418 00:21:59,800 --> 00:22:04,640 Speaker 1: the largest such borrowing ever by a Japanese company for 419 00:22:04,680 --> 00:22:06,919 Speaker 1: an acquisition. What do you think do you think that 420 00:22:06,960 --> 00:22:10,240 Speaker 1: this is fairly value in Shire? Um? You know, considering 421 00:22:10,280 --> 00:22:12,280 Speaker 1: that that it traded close to the levels that it's 422 00:22:12,280 --> 00:22:15,360 Speaker 1: being bought at last year, it doesn't seem like an 423 00:22:15,520 --> 00:22:18,960 Speaker 1: enormously expensive deal on that kind of metric. But in 424 00:22:19,040 --> 00:22:20,880 Speaker 1: terms of the amount of death that's being raised here, 425 00:22:21,320 --> 00:22:24,639 Speaker 1: the damage that's being done to Takada's balance sheet, H, 426 00:22:24,720 --> 00:22:26,159 Speaker 1: then you have a little bit more in the way 427 00:22:26,200 --> 00:22:28,280 Speaker 1: of questions. Just because there there are some risks here. 428 00:22:28,800 --> 00:22:31,360 Speaker 1: Shire is pretty heavily depending on the team affiliate business, 429 00:22:31,800 --> 00:22:34,080 Speaker 1: which is facing some competition now and will in the 430 00:22:34,119 --> 00:22:38,720 Speaker 1: future from potentially curative gene therapies. And also just in 431 00:22:38,840 --> 00:22:42,080 Speaker 1: terms of integration risk and the level of synergies that 432 00:22:42,119 --> 00:22:46,439 Speaker 1: Takeda is targeting both more than the usual. So definitely 433 00:22:46,440 --> 00:22:48,000 Speaker 1: a lot of risk given the amount of death that's 434 00:22:48,000 --> 00:22:50,600 Speaker 1: coming into play here, because Shi already had on the 435 00:22:50,680 --> 00:22:53,320 Speaker 1: role of eighteen point five billion in debt on its books, 436 00:22:53,440 --> 00:22:55,600 Speaker 1: So this is gonna be one of the more leverage 437 00:22:55,600 --> 00:22:59,240 Speaker 1: pharmacy cool companies in the world if this deal is completed, Max. 438 00:22:59,359 --> 00:23:03,920 Speaker 1: Just to go to this issue of orphan drugs, rare diseases, 439 00:23:04,000 --> 00:23:07,240 Speaker 1: the one I was just gonna use as an example 440 00:23:07,800 --> 00:23:11,560 Speaker 1: is La Praise and Ella Praises, the drug that Shire 441 00:23:11,640 --> 00:23:15,960 Speaker 1: has to treat Hunter's syndrome. The cost of the drug 442 00:23:16,040 --> 00:23:18,040 Speaker 1: for a full regiment, and I believe it is like 443 00:23:18,080 --> 00:23:22,560 Speaker 1: three hundred and sixty five thousand dollars and the sales 444 00:23:22,640 --> 00:23:25,560 Speaker 1: of La Praise were more than three hundred and fifty 445 00:23:25,880 --> 00:23:29,159 Speaker 1: million dollars a year. That's just for one drug. Is 446 00:23:29,200 --> 00:23:31,760 Speaker 1: that the kind of number that and the and the 447 00:23:31,840 --> 00:23:35,040 Speaker 1: situation that drug companies are really looking for yeah, so 448 00:23:35,080 --> 00:23:37,320 Speaker 1: there are a lot of benefits to that sort of 449 00:23:37,760 --> 00:23:40,119 Speaker 1: severe disease drugs of that type. You don't have to 450 00:23:40,160 --> 00:23:42,359 Speaker 1: spend a lot on marketing. You do have to go 451 00:23:42,400 --> 00:23:44,760 Speaker 1: out and find the patients and make sure they're getting 452 00:23:44,760 --> 00:23:48,439 Speaker 1: on drugs. But you know, it's enormously profitable in a 453 00:23:48,480 --> 00:23:51,919 Speaker 1: way that's different from you know, say, a really competitive 454 00:23:51,960 --> 00:23:54,600 Speaker 1: area like diabetes, where you have to fight against a 455 00:23:54,600 --> 00:23:57,760 Speaker 1: bunch of similar drugs for every single patient, pay huge 456 00:23:57,800 --> 00:24:01,520 Speaker 1: rebate rebates to insures in pharmacy enefit managers. So I 457 00:24:01,560 --> 00:24:03,479 Speaker 1: think that's one of the things that that makes us 458 00:24:03,480 --> 00:24:07,960 Speaker 1: attractive as well. What's the risk of failing to integrate 459 00:24:08,000 --> 00:24:10,480 Speaker 1: the two companies? Well, I mean, when you're talking about 460 00:24:10,480 --> 00:24:13,119 Speaker 1: the debt level and leverage, there's a little voice in 461 00:24:13,160 --> 00:24:16,320 Speaker 1: the back of my head that just keeps saying Valiant, Valiant, Valiant. 462 00:24:16,320 --> 00:24:21,200 Speaker 1: I mean, is this going to be the same? All right? Thanks, 463 00:24:21,240 --> 00:24:24,080 Speaker 1: thanks for the name. Oh yeah, well there you go. 464 00:24:24,359 --> 00:24:27,040 Speaker 1: That makes much Well, of course they don't want the 465 00:24:27,119 --> 00:24:29,119 Speaker 1: name in the back of the head saying Valiant, But 466 00:24:29,200 --> 00:24:31,120 Speaker 1: you know, is there a risk that this could end 467 00:24:31,200 --> 00:24:34,399 Speaker 1: up being something like that, a highly levered deal that 468 00:24:34,480 --> 00:24:38,280 Speaker 1: goes bad? I definitely think there is, because you know, 469 00:24:38,320 --> 00:24:40,840 Speaker 1: you have the biggest ever take over from from a 470 00:24:40,920 --> 00:24:44,119 Speaker 1: Japanese country company of a drug company. UM that that 471 00:24:44,240 --> 00:24:47,600 Speaker 1: offers some some potential integration headaches and um as I 472 00:24:47,640 --> 00:24:52,119 Speaker 1: mentioned those risks of the hemophilia franchise, some other generic competition. 473 00:24:52,520 --> 00:24:56,400 Speaker 1: If if Shire delivers, especially if it's pipeline delivers less 474 00:24:56,400 --> 00:24:59,840 Speaker 1: than expected or hemophilia competition is great and expected, you 475 00:25:00,040 --> 00:25:03,040 Speaker 1: could see a sales slowdown that that makes that debtload 476 00:25:03,560 --> 00:25:05,960 Speaker 1: even scarier. Well, well, it's probably not going to be 477 00:25:06,040 --> 00:25:08,600 Speaker 1: anything on the scale of Valiant, where you know the 478 00:25:08,640 --> 00:25:12,320 Speaker 1: business kind of just collapsed. Uh still still makes their 479 00:25:12,320 --> 00:25:14,800 Speaker 1: debt paid down targets which are going to have to 480 00:25:14,800 --> 00:25:19,000 Speaker 1: be aggressive Uh look pretty risky. Does it matter at 481 00:25:19,040 --> 00:25:21,399 Speaker 1: all that this is a Japanese and a British company 482 00:25:21,400 --> 00:25:25,680 Speaker 1: coming together in an age of trade wars and trade concerns. 483 00:25:26,240 --> 00:25:28,960 Speaker 1: I mean, you know that that is a potential risk 484 00:25:29,000 --> 00:25:32,439 Speaker 1: as well considered because things are so volatile, and especially 485 00:25:32,520 --> 00:25:36,480 Speaker 1: United States, I think the Trump administration has been making 486 00:25:36,520 --> 00:25:40,160 Speaker 1: some noise about other countries paying it's paying their fair 487 00:25:40,160 --> 00:25:42,679 Speaker 1: share for medicines. You know, we subsidize a lot of 488 00:25:42,760 --> 00:25:46,160 Speaker 1: r and d costs UH through paying an outside share 489 00:25:46,200 --> 00:25:48,960 Speaker 1: of of you know, paying higher drug prices, paying more 490 00:25:49,000 --> 00:25:51,639 Speaker 1: for medicines. UM. So if that changes that, that's another 491 00:25:51,640 --> 00:25:55,560 Speaker 1: potential risk of such a big international UH transaction. Who 492 00:25:55,640 --> 00:25:59,480 Speaker 1: might be next? Because he tried to buy Shire a 493 00:25:59,520 --> 00:26:02,359 Speaker 1: couple of years ago. Um. Also there was talk that 494 00:26:02,440 --> 00:26:05,440 Speaker 1: Allergan was interested in Shire at one point. Who's next? 495 00:26:05,480 --> 00:26:08,240 Speaker 1: You believed? Um, You know, I don't think there's a 496 00:26:08,280 --> 00:26:13,200 Speaker 1: particularly acute risk of another company jumping into to kind 497 00:26:13,200 --> 00:26:16,520 Speaker 1: of mess up to Kata's offer, just given the risk 498 00:26:16,600 --> 00:26:19,200 Speaker 1: profile and the cost of the deal. You know, fiser 499 00:26:19,280 --> 00:26:21,320 Speaker 1: Is always mentioned is the most likely to go for 500 00:26:21,320 --> 00:26:24,040 Speaker 1: a mega deal, but they were pretty explicit that they 501 00:26:24,040 --> 00:26:27,080 Speaker 1: weren't interested on their most recent earnings call. Um, but 502 00:26:27,400 --> 00:26:30,240 Speaker 1: I think fiser Is is due for a deal of 503 00:26:30,359 --> 00:26:33,560 Speaker 1: decent size, even if it's not Shire, UM Murk as well. 504 00:26:33,720 --> 00:26:36,200 Speaker 1: The question is whether they're going to go for something 505 00:26:36,240 --> 00:26:39,560 Speaker 1: of of the big consolidating type or or to try 506 00:26:39,600 --> 00:26:42,000 Speaker 1: to poster their pipelines. You know, just to put us 507 00:26:42,000 --> 00:26:44,359 Speaker 1: in a perspective, to Kata and Shire together would have 508 00:26:44,720 --> 00:26:47,360 Speaker 1: more than thirty one billion dollars of revenue UH. That 509 00:26:47,480 --> 00:26:50,320 Speaker 1: doesn't put it in the top five in terms of revenue. 510 00:26:50,359 --> 00:26:53,600 Speaker 1: It's behind Johnson and Johnson, roche Viser, no Artists, and 511 00:26:53,640 --> 00:26:57,480 Speaker 1: no Fee Murk Bear lax of Kline. Uh So, definitely 512 00:26:57,560 --> 00:27:00,680 Speaker 1: an interesting tie up that pushes it into the top ranks, 513 00:27:00,920 --> 00:27:03,159 Speaker 1: but they are both of much smaller size and some 514 00:27:03,200 --> 00:27:06,119 Speaker 1: of them on the top five of total debt and 515 00:27:06,240 --> 00:27:09,439 Speaker 1: leverage ratio. Though. Well, they can have that that crown 516 00:27:09,560 --> 00:27:11,879 Speaker 1: and we're proudly perhaps for for the time being anyway, 517 00:27:11,920 --> 00:27:13,720 Speaker 1: Max Neeason, thank you so much for being with us. 518 00:27:13,760 --> 00:27:16,440 Speaker 1: Max Neeason is our biotech, farm and healthcare columnist for 519 00:27:16,440 --> 00:27:19,720 Speaker 1: Bloomberg Opinion, joining us here in our leven three oh 520 00:27:19,840 --> 00:27:24,280 Speaker 1: the studios. Thanks for listening to the Bloomberg P and 521 00:27:24,359 --> 00:27:27,400 Speaker 1: L podcast. You can subscribe and listen to interviews at 522 00:27:27,440 --> 00:27:31,920 Speaker 1: Apple Podcasts, SoundCloud, or whatever podcast platform you prefer. I'm 523 00:27:31,920 --> 00:27:35,359 Speaker 1: Pim Fox. I'm on Twitter at pim Fox. I'm on 524 00:27:35,400 --> 00:27:38,840 Speaker 1: Twitter at Lisa abramoids one. Before the podcast, you can 525 00:27:38,880 --> 00:27:41,240 Speaker 1: always catch us worldwide on Bloomberg Radio.