Raphael Stevens

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Hi folks! Two competing cell therapies from Bristol Myers Squibb and Johnson & Johnson both got good news from the Food and Drug Administration on Friday. 

But J&J’s drug is walking away with a notable edge over its rival.
The FDA expanded the approvals of both therapies, allowing patients to use them as earlier lines of treatment for a type of blood cancer called multiple myeloma. That can damage the bones, immune system, kidneys and red blood cell count.
Before that decision, J&J’s drug Carvykti and Bristol Myers’s treatment Abecma were both only available to people who previously received at least four specific drug regimens for the incurable blood cancer. 
First and foremost, the expanded approvals are a major step for patients. 
They add more options to a growing arsenal of treatments that have helped improve outcomes for people with multiple myeloma. People with the disease often relapse or their cancer becomes resistant to one treatment, requiring them to switch to different drug regimens. 

There’s no doubt that the approvals will expand the reach of both treatments to thousands of eligible patients. New cases of multiple myeloma crop up each year: More than 35,000 new cases will be diagnosed in 2024 in the U.S., according to J&J’s estimates. 
But the new approvals also give J&J’s therapy, which was developed with Legend Biotech, a clear advantage over Bristol Myers’s drug. 
The FDA’s expanded approval says patients can use Carvykti after just one prior line of therapy for multiple myeloma and if certain conditions apply. J&J has said that earlier access to the drug may provide patients with the potential for a treatment-free period earlier in the progression of the disease.
Bristol Myers’s Abecma, which is co-marketed by 2seventy bio, can be administered after at least two drug regimens for multiple myeloma, under the new FDA approval. 

The New York Stock Exchange welcomes Bristol Myers Squibb on Nov. 20th, 2020.

Here’s what some analysts are saying: The product label difference between the two drugs offers a “significant commercial advantage for Carvykti,” Jefferies analyst Kelly Shi wrote in a Sunday note. 
Carvykti’s eligibility as a second-line treatment for multiple myeloma “should limit the use” of other similar cell therapies in the following lines of therapy, Shi said. 
Both Carvykti and Abecma belong to a class of personalized treatments known as chimeric antigen receptor T-cell – or CAR-T – therapies that work by modifying white blood cells known as T-cells to attack cancer. J&J’s drug has gradually gained ground over Abecma in the CAR-T market for multiple myeloma, even though it first entered the market a year later. 
With the new approval on Friday, Jefferies’ Shi expects J&J’s drug to win the majority of that market share. The firm believes Carvykti is “well positioned” to eventually reach more than 80,000 patients in the U.S., EU and Japan as a second, third or fourth line of therapy. 
The FDA’s expanded approval of Carvykti could also put it on track to be a blockbuster product for J&J. Last year, the drug pulled in just $500 million in worldwide sales, according to Legend Biotech. 
The drug’s long-term opportunity could be around $8 billion a year, and the expansion as a second-line treatment for multiple myeloma makes for a “key market segment for achieving this revenue,” Cantor Fitzgerald analyst Rick Bienkowski wrote in a Wednesday note ahead of the approval. 
Guggenheim analyst Kelsey Goodwin said Abecma’s peak annual sales could be around $450 million a year, according to a Reuters interview last week. Bristol Myers’s drug brought in $472 million in worldwide sales in 2023. 
But even with new approvals under their belts, the two companies are grappling with the same long-term issue: supply constraints. 
Both J&J and Bristol Myers have outlined plans to boost production of their respective drugs. I’ll be watching to see how that part of the story plays out later this year, so stay tuned.
Feel free to send any tips, suggestions, story ideas and data to Annika at [email protected].

Latest in health care technology

A look at Mount Sinai’s approach to AI

Signage hangs outside Mount Sinai Hospital on August 4, 2014 in New York City.
Getty Images

On Monday, I visited part of the Mount Sinai Health System, which spans eight hospital campuses and a medical school, to learn about how it’s using generative artificial intelligence. 
In a small corner of The Mount Sinai Hospital that currently serves as the med school’s AI department, I spoke with executives about current initiatives and plans for the future – including plans to move that very department to a much larger, brand new building in June.
While Mount Sinai has been exploring applications of more traditional machine learning models for years, like many health systems, the organization has been looking closely at generative AI since OpenAI’s ChatGPT exploded onto the scene at the end of 2022.
Dr. Bruce Darrow, the health system’s interim chief digital and information officer, said Mount Sinai is evaluating use cases across patient care, education and research. Within patient care, anything the health system can do to safely help clinicians and staff speed up decision making is important, he said. 
For instance, Mount Sinai’s radiologists (doctors who use medical images like CT scans, MRIs and X-rays to identify and treat conditions) are already working with a number of new AI tools. Dr. Laurie Margolies, director of breast imaging at Mount Sinai, said she is exposed to three different AI software tools in her day-to-day work. 
One tool can evaluate an entire mammogram, another can evaluate a breast ultrasound and the third evaluates image quality, which radiologists can use to check on their technique and positioning, Margolies said. While radiologists don’t ever just defer to the computer, she said, AI can help provide an extra layer of assurance.   
“I think it’s a wellness tool,” Margolies said. “I think it’s making me much more relaxed. When I think a mammogram is normal, and the AI thinks it’s normal, I’m more confident hitting that normal button.”
Despite the ongoing hype and excitement around generative AI’s potential in health care, Mount Sinai is trying to take a measured approach to its implementation. Dr. David Reich, president at The Mount Sinai Hospital and Mount Sinai Queens, said a lot of the initial use cases have been rather quiet. 
One of the first places the technology was introduced, for instance, was in Mount Sinai’s financial departments, where Reich said people are now processing bills more effectively. 
“We’d rather be a little bit more slow and plodding and workflow-focused because we’re in a very serious business,” he said. 
Reich said it can be challenging to determine which AI solutions are actually worthwhile, so Mount Sinai has established a governance structure to help assess whether a tool is safe, feasible, practical and ethical to use. Above all else, the software needs to help address real problems, he said. 
“A lot of people just want to sell an algorithm,” Reich said.
Feel free to send any tips, suggestions, story ideas and data to Ashley at [email protected]. More

General Motors’ Cruise self-driving vehicle unit will redeploy cars on U.S. roadways for the first time since October.
The relaunch comes after the company ceased operations weeks after an Oct. 2 accident in which a pedestrian in San Francisco was dragged 20 feet by a Cruise robotaxi.
Cruise on Tuesday said its “goal is to resume driverless operations,” however it did not provide a timeline for doing so.

A Cruise vehicle in San Francisco on Feb. 2, 2022.
David Paul Morris | Bloomberg | Getty Images

General Motors’ Cruise self-driving vehicle unit will redeploy cars on U.S. roadways Tuesday for the first time since October, beginning with a small fleet of human-driven vehicles in Phoenix, the company said.
The relaunch comes after the company ceased operations weeks after an Oct. 2 accident in which a pedestrian in San Francisco was dragged 20 feet by a Cruise robotaxi after being struck by a separate vehicle.

The redeployed vehicles will not operate as they previously did — as robotaxis — but will “create maps and gather road information in select cities, starting in Phoenix,” the company said.
Cruise said its “goal is to resume driverless operations,” however it did not provide a timeline for doing so. It also did not announce a timetable for expanding human-driven vehicles to other cities.
“We have not yet made a commitment to where or when we will start supervised or driverless operations,” a spokesperson said in a statement to CNBC.
Still, the company called the relaunched fleet with human drivers “a critical step for validating our self-driving systems as we work towards returning to our driverless mission.”
“In October 2023, we paused operations of our fleet to focus on rebuilding trust with regulators and the communities we serve, and to redesign our approach to safety,” Cruise said in a blog post. “We’ve made significant progress, guided by new company leadership, recommendations from third-party experts, and a focus on a close partnership with the communities in which our vehicles operate. We are committed to this improvement as a continuous effort.”

A third-party probe into the October incident and subsequent fallout, which was ordered by GM and Cruise, found culture issues, ineptitude and poor leadership were at the center of regulatory oversights that led to the accident. The probe also investigated allegations of a coverup by Cruise leadership, but did not find any evidence to support those claims.
Cruise said in January that it “accepts” the conclusions found in the report. The San Francisco-based company, of which GM owns about 80%, said it will “act on all” recommendations and is “fully cooperating” with investigations by state and federal agencies following the Oct. 2 accident.
The company said in January that investigations or inquiries into the incident included those by the California DMV, the California Public Utilities Commission, the National Highway Traffic Safety Administration, the U.S. Department of Justice and the Securities and Exchange Commission.
Prior to the accident, Cruise was planning an aggressive expansion of robotaxis outside its home market where the majority of its vehicles operated.
In addition to the ceasing of operations, Cruise leadership has been gutted: Its co-founders, including CEO and co-founder Kyle Vogt, resigned and nine other leaders were ousted. The venture also laid off 24% of its workforce as well as a round of contractors.

Don’t miss these stories from CNBC PRO: More

Boeing airplane deliveries dipped in the first quarter as the company faces increased scrutiny.
The manufacturer delivered 29 planes in March, most of them 737s.
Boeing’s major airline customers have complained that delivery delays have forced them to rethink their growth plans.

Boeing 737 MAX airplanes are pictured outside a Boeing factory on March 25, 2024 in Renton, Washington. 
Stephen Brashear | Getty Images

Boeing airplane deliveries dropped in the first quarter to the lowest number since mid-2021 as the company faces increased scrutiny after a door plug blew out from one of its 737 Max 9 planes midair in January.
The company handed over 83 planes in the three months ended March 31, most of them 737s, compared with 157 in the prior quarter and 130 planes in the year-earlier period. Solely in March, Boeing delivered 29 planes. Airbus said Tuesday that it delivered 142 planes in the first three months of the year, 63 of them in March.

Boeing customers are still ordering new jets from the manufacturer, which along with Airbus dominates the large jetliner market. The company logged orders for 111 for new planes last month when stripping out two cancellations, 85 of them 737 Max aircraft for American Airlines, which the carrier announced in early March.
The latest tally comes after the Jan. 5 accident on Alaska Airlines Flight 1282 brought Boeing inches from a catastrophe. Federal accident investigators said the door plug was missing bolts that hold it in place. Since the accident, the Federal Aviation Administration has inspected Boeing’s 737 Max production and barred the plane maker from increasing output of the jets until it signs off on its quality control procedures.
Boeing executives have said the company is slowing down its production to improve quality control and avoid so-called traveled work, when repairs or other tasks occur out of sequence.
“We won’t rush or go too fast,” Boeing CFO Brian West said at a Bank of America conference last month. “In fact, we’re deliberately going to slow to get this right. And we are the ones who made the decision to constrain rates on the 737 program below 38 per month until we feel like we’re ready. And we’ll feel the impact of that over the next several months.”
Aircraft delivery delays sparked criticism from the CEOs of some of Boeing’s biggest airline customers, and in its wake, CEO Dave Calhoun last month announced he will step down by year’s end. Boeing also replaced its board chair and the head of its commercial airplane unit.

Alaska Airlines said last week it received $160 million in compensation from Boeing in the first quarter stemming from a brief grounding of the plane after the accident.
Boeing is scheduled to report first-quarter results and update investors on April 24.

Don’t miss these stories from CNBC PRO: More

Barstool Sports founder Dave Portnoy bet $600,000 on UConn to win the NCAA men’s championship.
He won $2.7 million.
DraftKings reported a record NCAA tournament, with sports betting now legal in 38 states plus Washington, D.C.

Barstool Sports founder Dave Portnoy is cashing in $2.76 million on UConn’s big win over Purdue on Monday night in the NCAA men’s championship game.
Portnoy tweeted the massive score off a March 20 $600,000 wager on the Huskies winning the national championship. Portnoy’s bet was a moneyline wager placed right before the NCAA tournament began, and required UConn to win six straight games for it to pay off for him. The bet paid off at 3.6-to-1.

DraftKings confirmed to CNBC it took the bet.
“The greatest bet of my life,” Portnoy said in the post on social media site X. “The biggest win of my life by a mile.”
Barstool signed a multiyear deal with DraftKings in February. The sports media company was previously owned by Penn Entertainment.
DraftKings reported a record NCAA tournament, with sports betting now legal in 38 states plus Washington, D.C. — five additional states since this time last year.
The American Gaming Association estimated Americans would legally wager $2.72 billion on the March Madness tournaments this year. That’s equivalent to 2.2% of the total handle wagered on any sporting events last year.

Geolocation tracking company GeoComply, which operators use to police bettors’ locations, told CNBC it saw a 42% increase in checks over the 2023 tournament.

Barstool founder and CEO Dave Portnoy is seen before the Florida Atlantic Owls and Loyola (Il) Ramblers game in the Barstool Invitational at Wintrust Arena on November 8, 2023 in Chicago, Illinois. 
Michael Hickey | Getty Images

DraftKings said Monday’s game was the most bet-on college basketball game of all time for the sportsbook.
FanDuel said the men’s championship game saw a 52% year-over-year increase in bet count and a 42% year-over-year increase in handle.
At Caesars Sportsbook, Monday’s championship game accounted for the most same-game parlays ever placed on a college basketball game.
“It was a tournament for the customers as favorites covered the spread 61% of the time,” Craig Mucklow, Caesars Sportsbook’s vice president of trading, said in an email.
Betting on the women’s tournament was particularly lucrative for the sportsbooks.
South Carolina’s undefeated season and the heroics of superstar Caitlin Clark fueled a massive influx of bets. FanDuel, BetMGM and Fanatics say the championship game was their single biggest betting event on women’s sports. Caesars said the women’s championship saw double the previous handle record for a women’s college basketball game.
“We could only imagine the handle if the game was given a proper primetime slot,” Mucklow said of the women’s final.
— CNBC’s Dan Mangan contributed to this report. More

3G Capital exited its investment in Kraft Heinz last year, marking an end of an era for the Brazilian private equity firm.
After a disastrous quarter for Kraft Heinz in 2019, some investors pointed fingers at 3G’s penchant for aggressive cost cutting.
Warren Buffett stood by 3G and Kraft Heinz. Berkshire Hathaway remains the food company’s largest shareholder.

Brazilian private equity firm 3G Capital quietly sold off its 16.1% stake in Kraft Heinz in the fourth quarter, nearly nine years after masterminding the blockbuster merger of Kraft Foods and Heinz with Warren Buffett.
The sale marks the end of an era for 3G. The firm’s influence over Kraft Heinz had been dwindling in recent years as its number of board seats slipped from three to none by July 2022.

“3G has not been involved in the management of Kraft Heinz, nor have they been on the Board for several years. They had continued to be an investor and were treated as we do any investor,” Kraft Heinz said in a statement to CNBC. “We did learn from their recent filing that 3G exited the Kraft Heinz stock entirely in 2023.”
The company added that Buffett’s Berkshire Hathaway, its largest shareholder with a 26.8% stake, is a committed long-term owner.
3G did not immediately respond to a request for comment from CNBC.

Heinz Kraft ketchup arranged in Hastings-on-Hudson, New York, US, on Tuesday, July 25, 2023.
Tiffany Hagler-Geard | Bloomberg | Getty Images

Berkshire and 3G’s doomed romance began on Valentine’s Day in 2013 when the two firms announced they were teaming up to take Heinz private. The merger with Kraft Foods followed two years later.
The new company initially pleased investors with its earnings growth, thanks to its cost-cutting approach favored by 3G. The firm had already found success with that strategy when it created beer giant Anheuser-Busch InBev through a series of megamergers and took Burger King private and revived its sales.

But the packaged food business presented new challenges. Consumers were shifting to eating more fresh food. Plus, retailers’ private-label brands and newcomers touting themselves as a healthier option were stealing Big Food’s shoppers. Kraft Heinz sought to drive inorganic growth through a takeover bid for Unilever, but the Popsicle owner rejected its offer.
Then a disastrous quarter came for Kraft Heinz in 2019. In a single earnings report, the company slashed its dividend, disclosed a Securities and Exchange Commission investigation into its accounting practices and wrote down its brands by $15 billion.
Several months later, Buffett told CNBC that Berkshire and 3G overpaid for Kraft Heinz, buoyed by optimism that its brands were more valuable than they actually were. Still, he stood by both 3G and Kraft Heinz. Other investors blamed 3G’s aggressive cost cutting for the company’s troubles.
To reverse the company’s downward spiral, 3G handpicked the food giant’s new chief executive, an AB InBev veteran, and Kraft Heinz went into turnaround mode. The company announced plans to ramp up its marketing and advertising spending and shift its strategy for making new products. To reduce its exposure to private-label competition, it also sold its cheese business to Lactalis, a French dairy giant, and its Planters nuts brand to Hormel.
In 2021, 3G founding partner Jorge Paulo Lemann stepped down from Kraft Heinz’s board. The following year, fellow founding partner Alexandre Behring left the board. And two months after Behring’s departure, 3G’s final board member, former AB InBev CEO Joao Castro-Neves, also stepped down. Kraft Heinz disclosed his departure in a regulatory filing but no press release — or fanfare — accompanied it.
3G had been periodically trimming its stake in Kraft Heinz since 2018. When it sold 25 million shares in 2019, at the height of the company’s troubles, the stock fell 4% in response to the disclosure. In 2022, it distributed about 7% of Kraft Heinz to investors in its fund, which reportedly included tennis star Roger Federer.
Last year, Kraft Heinz tapped Carlos Abrams-Rivera as its new chief executive. While he’s been with the company since 2020, he’s notably the company’s first CEO without ties to 3G. More