WEBVTT - FDA Grants Full Approval of Pfizer-BioNTech Vaccine 0:00:01.800 --> 0:00:04.440 This is Bloomberg Business Week. I'm Karl Masser and I'm 0:00:04.480 --> 0:00:07.280 Bloomberg Quick Takes Tim Stanovik. We're here every day bringing 0:00:07.320 --> 0:00:09.840 you the latest news from the world to business and finance, 0:00:09.840 --> 0:00:13.640 plus technology, politics, economics, all purtnising the power of Business 0:00:13.680 --> 0:00:17.119 Week reporters and editors, not to mention our journalists and 0:00:17.160 --> 0:00:20.000 analyst in more than one twenty countries. You can download 0:00:20.000 --> 0:00:23.239 Bloomberg Business Week and iTunes, SoundCloud, or Bloomberg dot Com. 0:00:23.400 --> 0:00:25.200 You can also listen to our radio show at two 0:00:25.200 --> 0:00:27.760 pm Eastern Time on the Bloomberg Radio or watch us 0:00:27.760 --> 0:00:32.160 on YouTube. Searched Bloomberg clovel News. Let's get to Dr 0:00:32.240 --> 0:00:35.760 Seth Letterman, the CEO of and the co founder of 0:00:35.960 --> 0:00:39.400 Photonics Pharmaceuticals, also the chairman. He joins us once again 0:00:39.440 --> 0:00:42.159 on the phone from Massachusetts. Dr Letterman, It's great to 0:00:42.200 --> 0:00:45.519 have you back with us. How are you great to 0:00:45.560 --> 0:00:48.239 be with you again? Um, well, it's a great day 0:00:48.280 --> 0:00:50.720 to be speaking to you about COVID vaccine. Yeah, a 0:00:50.760 --> 0:00:52.800 lot of news when it comes to COVID vaccines. We 0:00:53.000 --> 0:00:56.800 just heard from President Biden encouraging everybody who has not 0:00:56.920 --> 0:00:59.280 yet gotten a vaccine to go out there and get it. 0:00:59.320 --> 0:01:01.560 Do you agree with the President that this continues to 0:01:01.600 --> 0:01:07.120 be a pandemic of the unvaccinated? Absolutely, President Biden is 0:01:07.160 --> 0:01:09.880 a tough act to follow. I thought he had a 0:01:09.920 --> 0:01:14.520 clear message and I agree with him that by and large, 0:01:14.680 --> 0:01:18.319 the particularly fueled by the delta variant, this is a 0:01:20.000 --> 0:01:23.600 epidemic or pandemic of the unvaccinated in the United States 0:01:23.720 --> 0:01:28.200 right now. And so Dr Lettiman, we heard from President 0:01:28.240 --> 0:01:31.720 Biden that FDA approval it's the gold standard. But I'm 0:01:31.720 --> 0:01:33.880 curious to hear your take that you know, now that 0:01:33.959 --> 0:01:37.320 we do have full authorization, it's finally here. Do you 0:01:37.360 --> 0:01:43.320 think this will actually lead to meaningfully more vaccinations? Well, 0:01:43.720 --> 0:01:45.560 I hope so. First of all, I think it's a 0:01:45.680 --> 0:01:50.120 sign of a great achievement for Fire in their partner 0:01:50.160 --> 0:01:53.280 by Intech to get their vaccine to this point. And 0:01:53.320 --> 0:01:56.120 I think many people believe that Madonna is not far 0:01:56.240 --> 0:01:59.960 behind or in an unusual situation where the Surgeon General 0:02:00.000 --> 0:02:04.000 all Um is kind of tipping his uh, you know, 0:02:04.040 --> 0:02:07.000 tipping his cards on some of these approvals coming up. 0:02:07.480 --> 0:02:09.920 So I think that the m and A technology that 0:02:10.000 --> 0:02:14.120 they developed and rapidly deployed has two shown great promise 0:02:14.200 --> 0:02:17.480 and it's a very exciting time. But on the other hand, 0:02:17.720 --> 0:02:20.800 you know, there is also an announcement by the CDC, 0:02:21.280 --> 0:02:24.839 FDA and a bunch of other groups, the White House, 0:02:24.919 --> 0:02:28.920 COVID Task Force, etcetera, that booster shots are going to 0:02:28.960 --> 0:02:32.600 be recommended and that they're going to be starting on September. 0:02:33.639 --> 0:02:35.560 So at the same time where this is a great 0:02:35.720 --> 0:02:39.520 advance and a recognition of what's happened so far, I 0:02:39.560 --> 0:02:44.079 think there's also been a concession that these vaccines are 0:02:44.120 --> 0:02:49.880 providing only temporary protection, not durable protection. We'll talk to you, 0:02:49.919 --> 0:02:52.119 talk to us about where you are with the type 0:02:52.160 --> 0:02:56.280 of protection that you're developing right now at Tonics Pharmaceuticals. 0:02:56.680 --> 0:02:58.960 What is the vaccine against COVID that you're working on, 0:02:59.000 --> 0:03:02.360 and what's the latest on the timeline for when it 0:03:02.440 --> 0:03:07.840 could actually be something that's used on us. Thank you. 0:03:07.880 --> 0:03:11.920 We're developing a live virus vaccine and it's based on 0:03:11.960 --> 0:03:15.519 a novel platform that we developed. But live virus vaccines 0:03:15.560 --> 0:03:19.960 are the oldest type of vaccine technology, and even an 0:03:20.040 --> 0:03:24.440 Operation Warp Speed there were four pillars of Operation Warp Speed, 0:03:24.480 --> 0:03:27.320 where you know, one of them was a highly successful 0:03:27.600 --> 0:03:30.720 Arna vaccines, but the other The fourth that they never 0:03:30.800 --> 0:03:34.600 really got to was live virus vaccines. Merke was developing 0:03:34.639 --> 0:03:37.280 two of them, but then in January of this year 0:03:38.240 --> 0:03:42.680 abandoned those programs. So we're developing a live virus vaccine 0:03:42.840 --> 0:03:49.120 against COVID nineteen. Because traditionally, live virus vaccines have provided 0:03:49.560 --> 0:03:54.360 durable immunity, meaning years, decades, even lifelong. And when President 0:03:54.400 --> 0:03:58.240 Biden mentioned some of the great successes in the history 0:03:58.280 --> 0:04:05.400 of vaccination, he specifically mentioned smallpox, measles, mumps rebella, and polio. 0:04:05.520 --> 0:04:09.400 Those are live virus vaccines. So we don't know all 0:04:09.480 --> 0:04:14.520 of the reasons why live virus vaccines provide such durable immunity, 0:04:14.560 --> 0:04:19.960 but many people believe it's because they stimulate T cell immunity, 0:04:20.000 --> 0:04:23.240 and a particular type of T cell immunity that has 0:04:23.360 --> 0:04:28.960 this long durability. So hypothetically, speaking with a live virus vaccine, 0:04:29.240 --> 0:04:31.839 would a booster shot be needed for that type of 0:04:31.880 --> 0:04:37.080 vaccine versus, you know, an m R and a based vaccine. Well, 0:04:37.720 --> 0:04:41.240 we won't know for COVID until we get into human trials, 0:04:41.279 --> 0:04:46.000 but for smallpox there is no booster required, and measles 0:04:46.040 --> 0:04:52.520 monster rebella typically is lifelong um so they do last 0:04:52.560 --> 0:04:55.280 a very long time, but again it's something that will 0:04:55.839 --> 0:05:00.760 need to figure out when when is the timeline for 0:05:00.920 --> 0:05:05.000 human trials. Thanks we expect to be in human trials 0:05:05.040 --> 0:05:08.520 from the first half of next year. The thing that's 0:05:08.680 --> 0:05:11.800 holding us back is that it's more difficult to make 0:05:12.320 --> 0:05:16.080 the high quality of live virus vaccine necessary to do 0:05:16.240 --> 0:05:19.480 human trials. And that's really the advantage of the m 0:05:19.560 --> 0:05:23.599 R and A vaccines. Since they are completely synthetic, you 0:05:23.640 --> 0:05:27.400 can rapidly manufacture them. And again, hats off to Fiser 0:05:27.480 --> 0:05:29.719 and by In Tech for what they've done. They've really 0:05:30.160 --> 0:05:33.800 delivered a solid blow to give us some breathing room 0:05:33.839 --> 0:05:38.040 with this pandemic for the vaccinated anyway. But live virus 0:05:38.080 --> 0:05:41.920 vaccines are harder to develop, but when they're developed, they 0:05:41.920 --> 0:05:46.440 can be easier to manufacture, easier to store, easier to transport, 0:05:46.839 --> 0:05:51.280 and typically are one shot vaccines. And so Dr Lettterman, 0:05:51.320 --> 0:05:54.320 I want to go back to the topic of boosters, 0:05:54.560 --> 0:05:56.600 and in the notes you sent over, you made the 0:05:56.640 --> 0:05:58.840 point that you know we would be better protected by 0:05:58.920 --> 0:06:02.800 vaccinating the unvaccinated here in the US and around the world. 0:06:02.839 --> 0:06:05.680 But I got to ask, what about for those who 0:06:05.760 --> 0:06:08.400 don't want to get vaccinated. If you assume that there's 0:06:08.520 --> 0:06:11.000 you know, a certain percentage of the population that will 0:06:11.040 --> 0:06:15.720 never willingly take the vaccine. Uh, in that situation, what 0:06:15.760 --> 0:06:20.520 would what? What do we do? Well? It's an excellent question, 0:06:21.040 --> 0:06:25.920 and it seems to be uh hodgepodge of reasons why 0:06:25.960 --> 0:06:30.840 people are reluctant. Hopefully, the President said, Hopefully the FDA 0:06:30.920 --> 0:06:34.240 approval will allay some of their concerns. I know at 0:06:34.320 --> 0:06:35.919 least some of them feel like they don't want to 0:06:35.920 --> 0:06:40.560 be um, you know, the subject of tests or something. 0:06:40.880 --> 0:06:43.280 I think at this point, as the President said, two 0:06:43.600 --> 0:06:46.120 million Americans have been vaccinated, so I think we're beyond 0:06:46.160 --> 0:06:49.360 the test stage. But I think that brings up another 0:06:49.440 --> 0:06:54.719 potential weakness of the m R and A vaccines that 0:06:55.120 --> 0:06:59.839 we really don't know whether they block forward transmission. Forward 0:07:00.000 --> 0:07:03.960 transmission means that if someone is infected, are they able 0:07:04.040 --> 0:07:08.120 to transmit it to someone else? And for the big 0:07:08.240 --> 0:07:12.600 vaccine successes that we've had in history, smallpox, for example, 0:07:13.080 --> 0:07:16.880 it really does block forward transmission, and that was one 0:07:16.880 --> 0:07:20.080 of the reasons why this concept of herd immunity was 0:07:20.120 --> 0:07:24.600 so important. But we really don't know for the delta 0:07:24.720 --> 0:07:30.000 variant whether vaccinated people will be less infectious. Yeah, that's certainly. 0:07:30.080 --> 0:07:32.640 That's certainly what remains to be seen as Dr Seth Letterman, 0:07:32.680 --> 0:07:34.720 the co founder, a chief executive officer and chairman of 0:07:34.760 --> 0:07:38.680 Tonics Pharmaceuticals. You're listening to Bloomberg Business Week with Carol 0:07:38.760 --> 0:07:43.520 Messer and Bloomberg Quick Takes Tim Stinovic on Bloomberg Radio. Well, 0:07:43.560 --> 0:07:46.760 pregnant women with COVID nineteen, they are fifteen times more 0:07:46.800 --> 0:07:49.720 likely to die, fourteen times more likely to need to 0:07:49.720 --> 0:07:52.960 be intubated, and twenty two times more likely to have 0:07:53.080 --> 0:07:56.680 preterm birth than those who are uninfected. That's according to 0:07:56.720 --> 0:07:59.480 a study published this month by j A n A Network. 0:07:59.640 --> 0:08:03.920 Open Joinning's now is Shira Stein, healthcare reporter at Bloomberg. 0:08:04.000 --> 0:08:06.840 Lash joins us on the phone from Washington, d C. Shere. 0:08:06.920 --> 0:08:09.080 It's great to have you with us. The part that 0:08:09.360 --> 0:08:11.880 I didn't get to in your story is the fact 0:08:11.960 --> 0:08:18.360 that fewer than three quarters of pregnant people are vaccinated. 0:08:18.360 --> 0:08:21.640 If you're than one quarter, I should say seventy pregnant 0:08:21.640 --> 0:08:26.920 people are unvaccinated. Why is that so low? Yeah, it's 0:08:26.960 --> 0:08:30.240 a pretty shocking statistic. I think it's really because of 0:08:30.360 --> 0:08:33.360 the fact that none of the vaccine clinical trials, of 0:08:33.440 --> 0:08:36.439 the three vaccines in the US that are authorized and approved, 0:08:36.840 --> 0:08:41.000 none of them included pregnant people in their trials. Um. 0:08:41.040 --> 0:08:43.400 That's pretty common in clinical trials. Not to say that 0:08:43.440 --> 0:08:46.200 it's a good thing, um, but it's pretty common. And 0:08:46.240 --> 0:08:49.680 so pregnant people didn't have any data to rely on 0:08:49.760 --> 0:08:54.080 around safety or efficacy until after the vaccines were publicly 0:08:54.120 --> 0:08:58.160 available and when people who decided that it was worth 0:08:58.200 --> 0:09:01.079 it for them to try and see how until we 0:09:01.120 --> 0:09:03.520 got more data, and so for for months, we didn't 0:09:03.559 --> 0:09:05.760 have data on how this vacts, how any of these 0:09:05.800 --> 0:09:09.600 vaccines worked in pregnant people, and so where do we 0:09:09.679 --> 0:09:12.480 stand now? Because sure, pregnant people were excluded from the 0:09:12.559 --> 0:09:15.680 vaccine trials, sounds like that's pretty common, But do we 0:09:15.679 --> 0:09:18.240 actually have data now now that you know the vaccines 0:09:18.240 --> 0:09:21.320 have been available widely for months now, have they actually 0:09:21.920 --> 0:09:26.080 run trials that include pregnant people? Um. So it's not 0:09:26.080 --> 0:09:28.920 a trial so much as it is like data from 0:09:28.960 --> 0:09:32.200 what we've seen in the real world. But yes, absolutely, UM, 0:09:32.880 --> 0:09:36.440 vaccines are safe and effective for pregnant people. They do 0:09:36.520 --> 0:09:40.480 not cause miscarriages as there is, or fertility issues as 0:09:40.520 --> 0:09:44.720 there is the misinformation about that around UM, and as 0:09:44.800 --> 0:09:49.520 the as we saw and as I reported, there is 0:09:50.080 --> 0:09:53.440 there if you get COVID and you are pregnant, you 0:09:53.480 --> 0:09:56.520 are in a really really bad spot if you are unvaccinated, 0:09:57.360 --> 0:10:01.760 talk a little bit about that. Yeah, So what I 0:10:01.800 --> 0:10:05.320 found speaking to doctors across the country in places like 0:10:05.400 --> 0:10:09.199 Texas at Florida, but also places like Los Angeles and Seattle, Washington, 0:10:09.760 --> 0:10:12.559 was that they are seeing, with this latest surge in 0:10:12.600 --> 0:10:16.720 cases from Delta, a new trend of pregnant people who 0:10:16.880 --> 0:10:19.640 are getting really sick, who are needing to be intipated 0:10:19.679 --> 0:10:22.720 and put on a ventilator, who are having to deliver 0:10:22.760 --> 0:10:26.280 their babies early, and some who are dying UM and 0:10:26.320 --> 0:10:28.000 some who are having to spend months in the hospital. 0:10:28.040 --> 0:10:31.360 I mean, it's just really awful. These are largely unvaccinated 0:10:31.360 --> 0:10:35.800 pregnant individuals, and um they're largely young and healthy age 0:10:35.840 --> 0:10:38.920 like eighteen to thirty. So it's pretty shocking to hear this. 0:10:38.960 --> 0:10:40.760 You know, we've been hearing a lot about kids and 0:10:40.760 --> 0:10:43.480 and COVID in hospitals right now, but this is another problem, 0:10:43.600 --> 0:10:47.360 is pregnant people and getting COVID. So, I mean, those 0:10:47.360 --> 0:10:51.160 are terrifying stories, and I'm curious, I mean, is there 0:10:51.360 --> 0:10:54.319 is that because pregnant people are more at risk than 0:10:54.800 --> 0:10:57.599 a normal unvaccinated person, or is there any reason to 0:10:57.640 --> 0:11:00.520 believe that you're more at risk to become more seriously 0:11:00.559 --> 0:11:04.600 ill if you are also pregnant. Yeah, so pregnant. Being 0:11:04.640 --> 0:11:07.920 pregnant tends to suppress one's immune system, so that could 0:11:08.000 --> 0:11:10.760 be part of it. Um, what I the doctors I 0:11:10.840 --> 0:11:12.559 spoke to, you think that it's not so much a 0:11:12.640 --> 0:11:14.960 fact that you are more likely to get COVID if 0:11:14.960 --> 0:11:17.920 you're pregnant, more so that it's a compounding of factors. 0:11:18.040 --> 0:11:21.559 You know, your immune system is not as good, you're around, um, 0:11:21.600 --> 0:11:23.959 a number of people having to go to the doctor. Um, 0:11:24.600 --> 0:11:27.280 you know, there's there's a number of factors that could 0:11:27.320 --> 0:11:30.040 lead to it. And if you do get get COVID, 0:11:30.080 --> 0:11:32.840 then you're more likely to have severe illness. Based on 0:11:32.840 --> 0:11:34.440 your reporting, I know you spoke to a lot of 0:11:34.480 --> 0:11:37.840 people who were vaccinated and weren't vaccinated. What did they 0:11:37.880 --> 0:11:39.920 give you for the reasons they ultimately did decide to 0:11:39.960 --> 0:11:43.400 get best vaccinated who are pregnant and those holdouts who 0:11:43.480 --> 0:11:46.840 who decided not to. Yeah, I mean I actually had 0:11:46.880 --> 0:11:48.880 a really hard time talking to some of the people 0:11:48.880 --> 0:11:51.960 who have remained unvaccinated. UM. But what I what I 0:11:51.960 --> 0:11:54.920 can say is people are just really nervous because of 0:11:54.960 --> 0:11:58.680 the lack of information that there was. They're also, the 0:11:58.720 --> 0:12:01.719 CDC did not wreck men that pregnant people get the 0:12:01.800 --> 0:12:05.160 vaccine until a few weeks ago. UM. Two of the 0:12:05.480 --> 0:12:08.720 major medical societies for pregnan individuals, the Market College of 0:12:08.800 --> 0:12:12.880 Obstetrician and Gynecologists and the Society for Maternal and Fetal Medicine, 0:12:12.920 --> 0:12:15.720 they recommended it about a month ago. So it's just 0:12:15.960 --> 0:12:18.559 this is just a really recent thing. Some doctors still 0:12:18.600 --> 0:12:20.960 aren't sure about recommending it to their patients. You know, 0:12:20.960 --> 0:12:23.640 I'm beating stories about people saying, well, I talked to 0:12:23.679 --> 0:12:25.760 one doctor and my doctor said it was good for 0:12:25.760 --> 0:12:28.160 me to get but my sister's doctor said she shouldn't. 0:12:28.280 --> 0:12:30.920 And so I think there's just a lot of confusion 0:12:30.960 --> 0:12:33.839 out there. I don't think it's you know, people being 0:12:34.080 --> 0:12:36.560 quote unquote anti vaxers so much as it is that 0:12:36.600 --> 0:12:39.640 they are just genuinely nervous because of the lack of 0:12:39.679 --> 0:12:43.080 information because their doctors aren't sure what to tell them. Yeah, 0:12:43.080 --> 0:12:45.760 I think the confusion will continue to persist. When it 0:12:45.800 --> 0:12:48.280 comes to boosters and to what extent, Like, you know, 0:12:48.440 --> 0:12:51.760 somebody got a shot before they got pregnant, you've got 0:12:51.800 --> 0:12:54.440 fully vaccinated, do they get a booster? Right? That's that's 0:12:54.480 --> 0:12:56.360 the question, and I think a question that many people 0:12:56.480 --> 0:12:59.040 will have moving forward. It is a fantastic piece. It's 0:12:59.080 --> 0:13:00.640 the reason that it's a the most read in the 0:13:00.640 --> 0:13:03.800 Bloomberg terminal right now, it's called Pregnant, unvaccinated and intubated 0:13:03.960 --> 0:13:07.480 Doctors alarmed by rise that Shira Stein, healthcare reporter for 0:13:07.480 --> 0:13:10.880 Bloomberg Law, joining us on the phone from Washington. D 0:13:11.000 --> 0:13:14.240 c Uh, Katie. I think the question remains that, you know, 0:13:14.280 --> 0:13:16.640 the science continues to change. So the CDC coming out 0:13:16.640 --> 0:13:20.000 and actually saying that this is helpful, uh, that women 0:13:20.000 --> 0:13:22.320 need to do this, then that's a very important move there. 0:13:22.760 --> 0:13:26.800 This is Bloomberg Business Week with Carol Messer and Bloomberg 0:13:26.880 --> 0:13:30.920 Quick Takes Tim Stinovic on Bloomberg Radio. Well, the bidding 0:13:30.960 --> 0:13:33.800 war over a maker of airplane wheels and fire detection 0:13:33.840 --> 0:13:37.200 systems may herald a fresh wave of consolidation in the 0:13:37.240 --> 0:13:40.920 aerospace sector, so writes Brooke Sutherland, deals in Industrials columnists 0:13:40.920 --> 0:13:43.360 for Bloomberg opinion. Brooke story will be featured in the 0:13:43.440 --> 0:13:45.920 upcoming issue of Bloomberg Business Week magazine. You can read 0:13:45.920 --> 0:13:48.440 it now on the Bloomberg and at bloomberg dot com 0:13:48.480 --> 0:13:51.360 slash business Week. Also joining us is Joel Webber, editor 0:13:51.400 --> 0:13:54.280 at Bloomberg Business Week. He's on the remote from Massachusetts. 0:13:54.320 --> 0:13:57.920 So Joel, the big question is bigger is better back 0:13:58.120 --> 0:14:01.679 when it comes to aerospace and navy ation. Well, I'm 0:14:01.679 --> 0:14:04.200 gonna be honest, this isn't a space that I watched 0:14:04.480 --> 0:14:09.560 that closely. I'm glad you picked up on it. Um 0:14:09.640 --> 0:14:12.040 the uh, but that was what kind of jumped out 0:14:12.040 --> 0:14:14.400 at me from from brookes story, is like, you know, 0:14:14.480 --> 0:14:16.200 this isn't a place that we have seen a whole 0:14:16.240 --> 0:14:18.720 lot of action, and then all of a sudden we 0:14:18.760 --> 0:14:22.280 have and and it's not everyday companies, right Brooke? Who 0:14:22.320 --> 0:14:25.240 are what kind of players are we talking about here? Sure? 0:14:25.320 --> 0:14:29.960 So Megga makes um they're they're well known for their wheels, breaks, 0:14:30.000 --> 0:14:32.880 fire detection systems, things like that. Um, this is sort 0:14:32.880 --> 0:14:36.640 of a perennial takeover target. It often comes up in 0:14:36.800 --> 0:14:39.560 m and A speculation, but we've never really seen any 0:14:39.640 --> 0:14:42.640 deal get this far, and now it has not one 0:14:42.720 --> 0:14:45.920 but two suitors. The first is Parker Hanisons, which has 0:14:45.960 --> 0:14:49.200 been aggressively expanding its aerospace business over the past couple 0:14:49.240 --> 0:14:51.880 of years, trying to get out of some of its 0:14:51.920 --> 0:14:56.080 more traditional heavy duty industrial markets that tend to be 0:14:56.120 --> 0:14:59.120 a little bit more economically volatile um. And the other 0:14:59.360 --> 0:15:02.240 is trans Time, which is also an aerospace supplier and 0:15:02.400 --> 0:15:06.880 has a reputation for being particularly aggressive on pricing when 0:15:06.960 --> 0:15:10.280 it comes to the parts that itsels and parts and 0:15:10.320 --> 0:15:12.880 services to airplane makers. And so it's going to be 0:15:12.960 --> 0:15:15.240 a really interesting bidding war too to watch how it 0:15:15.240 --> 0:15:17.000 plays out, which you're right, I mean, just the fact 0:15:17.080 --> 0:15:19.880 that we have a bidding war at all is notable 0:15:19.920 --> 0:15:23.600 for a sector that's been particularly beaten down by COVID. Yeah, 0:15:23.600 --> 0:15:25.800 pro I want to talk about that the timing of 0:15:25.880 --> 0:15:28.640 this bidding war, because it feels like the industry at 0:15:28.720 --> 0:15:31.800 large is in a really weird place as we try 0:15:31.840 --> 0:15:36.480 to emerge from this pandemic. It is, and it's certainly 0:15:36.560 --> 0:15:38.320 trying to look at it right now when you have 0:15:38.400 --> 0:15:41.240 the headlines of it, the airlines warning about, you know, 0:15:41.480 --> 0:15:43.680 not quite seeing the demand they were hoping to see 0:15:44.160 --> 0:15:47.320 in August, the people canceling bookings, or you know, maybe 0:15:47.320 --> 0:15:50.280 just not making bookings at all. But um. At the 0:15:50.320 --> 0:15:53.080 same time, you know, those in the aerospace sector that 0:15:53.640 --> 0:15:56.200 weren't in the same position as Boeing, which you know, 0:15:56.320 --> 0:15:58.960 was dealing with the seven thirty seven Max crisis, actually 0:15:58.960 --> 0:16:01.400 their balance sheep looked pretty good. Um. You know, they 0:16:01.400 --> 0:16:04.560 were able to at the debt markets when they needed it. 0:16:04.600 --> 0:16:07.160 But you know, they're really coming out of this in 0:16:07.200 --> 0:16:10.520 a pretty strong position financially, and I think they're preparing 0:16:10.600 --> 0:16:12.600 for the next leg. And you know, one of the 0:16:12.640 --> 0:16:15.040 things that's been really interesting is this bad as this 0:16:15.240 --> 0:16:18.440 downturn had been for the aerostas sector, we're already starting 0:16:18.440 --> 0:16:21.320 to talk about getting back to a moment in time 0:16:21.320 --> 0:16:23.880 where we're not worried about not having enough passengers but 0:16:23.920 --> 0:16:26.640 worried about having enough planes. Um. And that's really where 0:16:26.640 --> 0:16:28.840 the industry was before the pandemic hit. I mean, there 0:16:28.920 --> 0:16:31.360 was a mad rushed by all of the airlines to 0:16:31.560 --> 0:16:33.960 try to get planes, trying to get the capacity so 0:16:34.040 --> 0:16:37.000 that they could fly passengers where they wanted to go. UM. 0:16:37.200 --> 0:16:39.920 And you know, against that that job, it does make 0:16:40.000 --> 0:16:42.360 sense to consolidate. You have you know a number of 0:16:42.360 --> 0:16:45.280 sort of midsized players but you also have a lot 0:16:45.320 --> 0:16:47.280 of very large players that have been doing a lot 0:16:47.320 --> 0:16:50.400 of deals, perhaps in this notable being Raytheon which acquired 0:16:50.840 --> 0:16:54.760 Rockwell collins Um also merged with raytheon the defense contractor, 0:16:54.800 --> 0:16:58.000 and so as you have other suppliers getting bigger um 0:16:58.000 --> 0:17:00.640 obviously as a duopoly as well, but in your airbus 0:17:00.760 --> 0:17:02.400 it makes sense to try to be as big as 0:17:02.400 --> 0:17:04.680 you possibly can beat yourself, Hey, Brooke, When it comes 0:17:04.720 --> 0:17:07.880 to this industry, the thing is is these companies, the 0:17:07.920 --> 0:17:12.800 airplane the airlines have to make these orders years and 0:17:13.040 --> 0:17:16.199 years in advance of when they expect to actually have 0:17:16.400 --> 0:17:19.320 that need, that capacity, they actually expect to have delivery 0:17:19.440 --> 0:17:22.359 of those aircraft. What are they? What are we hearing 0:17:22.400 --> 0:17:25.200 from the from Airbus and from Boeing right now about 0:17:25.359 --> 0:17:29.160 the way that airlines are canceling or actually ordering new 0:17:29.200 --> 0:17:30.960 planes and when are those going to be delivered? And 0:17:31.160 --> 0:17:33.840 are they all E three twenties and seven thirty seven maxes? 0:17:34.119 --> 0:17:37.280 What about alternative fuels take us into it. Yeah, no, 0:17:37.480 --> 0:17:40.159 So it's uh, we're starting to see you know, more 0:17:40.240 --> 0:17:44.560 actual orders men ancelations, which is a nice positive trend um, 0:17:44.560 --> 0:17:46.920 particularly for Boeing. They've really seen a ton of order 0:17:46.960 --> 0:17:49.840 activities from the US airlines that's really been the driver 0:17:50.640 --> 0:17:53.159 of their purchases. Today, there was a massive order from 0:17:53.320 --> 0:17:57.119 United Airlines for Boeing Jets Southwest also topped up at 0:17:57.160 --> 0:18:00.560 seven seven max order. And then Airbus had not seen 0:18:00.560 --> 0:18:03.080 as many cancelations as Bulling because they were in the 0:18:03.680 --> 0:18:07.000 um beneficial position of not having one of their planes 0:18:07.000 --> 0:18:09.760 grounded for nearly two years, which meant that the airlines 0:18:09.800 --> 0:18:12.960 have less selexibility to cancel their orders, and so they're 0:18:12.960 --> 0:18:15.360 being a lot more aggressive and looking at their production 0:18:15.400 --> 0:18:18.000 schedule and they think they can get back above their 0:18:18.000 --> 0:18:21.000 pre COVID pace by three. So that gets to that 0:18:21.040 --> 0:18:23.680 point you know, I was talking about, we're moving door 0:18:23.760 --> 0:18:26.720 to future where the airlines. Airlines are gonna be wanting 0:18:26.720 --> 0:18:29.720 these airplanes um that maybe they thought they didn't need 0:18:29.760 --> 0:18:31.400 a couple of months ago, but they will see find 0:18:31.440 --> 0:18:33.200 themselves in the position where they do it, and the 0:18:33.240 --> 0:18:35.800 planemakers and their suppliers are really going to have to 0:18:35.880 --> 0:18:39.400 ramp up capacity relatively quickly to meet that neat um. 0:18:39.440 --> 0:18:41.400 And then as you play that out further down the road, 0:18:41.480 --> 0:18:44.960 everybody is very concerned about the carbon footprint um of 0:18:45.000 --> 0:18:47.560 all aspects of the economy of a particularly air travel, 0:18:47.640 --> 0:18:50.359 and there's a lot of discussion about you know, using 0:18:50.640 --> 0:18:54.280 UM sustainable aviation fuels or even moving into sort of 0:18:54.359 --> 0:18:58.040 next generation engine technology. I don't know if we're there 0:18:58.119 --> 0:19:00.760 yet UM in terms of you know, hydro gender batteries 0:19:00.880 --> 0:19:03.680 or anything like that for for large airplane, but certainly 0:19:03.760 --> 0:19:05.680 they want to make as many changes as they can 0:19:05.680 --> 0:19:07.720 that are realistic right now. And you need money to 0:19:07.760 --> 0:19:09.480 do that. You need a bigger balance sheet, you need 0:19:09.520 --> 0:19:12.680 research and development dollars, and so that's another key driver 0:19:12.800 --> 0:19:18.240 for the consolidation thing. So what standing between this Megat 0:19:18.280 --> 0:19:21.280 deal in a finish line broke because it's uh, it's 0:19:21.320 --> 0:19:22.920 not clear if it's actually going to be a slam 0:19:23.000 --> 0:19:26.040 dunk or not, right I mean, And it's not price 0:19:26.359 --> 0:19:31.440 because both the buyers are offering very attractive valuations. They're 0:19:31.480 --> 0:19:36.000 above MEGASU pre pandemic high UM, We're talking about you know, 0:19:36.320 --> 0:19:39.159 pretty meat evaluations here. So price is not going to 0:19:39.200 --> 0:19:41.320 be the issue. But it's going to be more down 0:19:41.359 --> 0:19:45.400 to the UK government UM, which has been particularly prickly 0:19:46.119 --> 0:19:51.080 lately about takeovers, especially when they involved key domestic assets 0:19:51.119 --> 0:19:53.399 that have a link to national security. So Mega is 0:19:53.480 --> 0:19:57.000 also a defense supplier UM and this is happening in 0:19:57.119 --> 0:20:02.080 concert with another takeover of the UK defense supplier, Ultra Electronics, 0:20:02.080 --> 0:20:05.600 and so it's a difficult backdrop right now to try 0:20:05.680 --> 0:20:08.640 to do a aerospace and defense takeover in the UK. 0:20:08.800 --> 0:20:12.359 And so Parker Hannafon has made some pretty strong commitments 0:20:12.359 --> 0:20:15.320 to the UK government in terms of keeping the headquarters, 0:20:15.400 --> 0:20:19.600 keeping head count in engineering and manufacturing flat. They pledged 0:20:19.640 --> 0:20:22.160 to ramp up R and D spending pretty significantly over 0:20:22.160 --> 0:20:25.600 the next five years, which you know, those are meaningful commitments, 0:20:25.640 --> 0:20:27.920 and we haven't heard yet from trans Dynast it's willing 0:20:28.000 --> 0:20:30.600 to match that or perhaps go a little bit further. 0:20:30.680 --> 0:20:33.359 But I think that that is the biggest issue in 0:20:33.440 --> 0:20:36.080 this deal and probably what will determine who ultimately wins 0:20:36.240 --> 0:20:38.480 this sitting more well, there you have at brook Sutherland, 0:20:38.560 --> 0:20:41.280 Deals and industrials columnist for Bloomberg Opinion, joining us on 0:20:41.280 --> 0:20:43.840 the phone from New York City. Also with us Joel Weber, 0:20:44.160 --> 0:20:47.359 editor at Bloomberg Business Week, on the remote from Massachusetts. 0:20:47.400 --> 0:20:49.800 You can read brooks story. It's featured in the upcoming 0:20:49.840 --> 0:20:52.200 issue of Bloomberg Business Week magazine. You can read it 0:20:52.200 --> 0:20:55.000 at Bloomberg dot Com and of course, at the Bloomberg terminal. 0:20:55.200 --> 0:20:57.480 Also go to Bloomberg dot com slash of Business Week. 0:20:58.560 --> 0:21:02.040 This is the Big Day, the best of Bloomberg's in 0:21:02.160 --> 0:21:05.399 depth original reporting from around the globe. Well, we actually 0:21:05.480 --> 0:21:08.600 make sure we do as the economy. What covers is 0:21:08.640 --> 0:21:11.080 look at the data kind of broken down a bit. 0:21:11.160 --> 0:21:13.280 It's fun to becoming more and more expensively to be 0:21:13.320 --> 0:21:16.240 looking at the shifting billion dollars for the red entry levels. 0:21:16.280 --> 0:21:18.800 There's been ways of immigration that have taste a lot 0:21:18.840 --> 0:21:21.560 of resistance, a lot of color behind the scenes in 0:21:21.640 --> 0:21:24.560 a great untold story. How did Bezos really come out 0:21:24.600 --> 0:21:27.600 on top? It's the cover, says Jeff Wins. He always 0:21:27.600 --> 0:21:32.000 seems to win the Big Take on Bloomberg Radio. Today's 0:21:32.000 --> 0:21:34.680 Big Take, the very best of Bloomberg's in depth original 0:21:34.720 --> 0:21:37.840 reporting front around the globe every day, is by Rich Miller, 0:21:37.920 --> 0:21:40.679 economics reporter for Bloomberg News. He joins us on the 0:21:40.680 --> 0:21:43.480 phone from Washington, d C. It's all about FED Chair 0:21:43.560 --> 0:21:47.359 Jerome Powell's policy revolution and how it was blindsided by 0:21:47.359 --> 0:21:51.120 the COVID nineteen crisis. Rich Miller writes that when FED 0:21:51.200 --> 0:21:54.159 chair chair Jerome Powell rolled out a new motus up 0:21:54.200 --> 0:21:58.040 Rundy for running military policy at Jackson Hole. A year ago, 0:21:58.119 --> 0:22:01.240 the economy was just coming out of a pandemic driven 0:22:01.240 --> 0:22:04.480 nose dive. That was after a decade of disappointingly slow 0:22:04.520 --> 0:22:09.159 growth with inflation stubbornly below target. Well, times have changed, 0:22:09.280 --> 0:22:11.280 rich What was the mL he rolled out a year ago? 0:22:11.400 --> 0:22:15.320 And where are we now? Well, I mean it's as 0:22:15.359 --> 0:22:19.639