Raphael Stevens

The FAA grounded SpaceX’s Starship pending an investigation into the failure that caused the rocket to break apart midflight.
The regulator noted in a statement that it has received “reports of public property damage on Turks and Caicos” islands in the Caribbean.
SpaceX must complete the investigation and put in place any required corrective actions before the FAA issues the company with a new license to launch Starship again.

SpaceX’s mega rocket Starship launches for a test flight from Starbase in Boca Chica, Texas, on Jan. 16, 2025.
Eric Gay | AP

The Federal Aviation Administration said on Friday that SpaceX’s Starship rocket is grounded until the company and regulator complete an investigation into the midflight failure of the most recent test flight, which forced airlines to divert flights.
The regulator noted in a statement that, while there have been “no reports of public injury,” it has received “reports of public property damage on Turks and Caicos” islands in the Caribbean.

SpaceX must complete the investigation and put in place any required corrective actions before the FAA issues the company with a new license to launch Starship again.
The FAA diverted and delayed dozens of commercial airline flights — including several operated by American Airlines, JetBlue Airways and Delta Air Lines — after the Starship rocket exploded and rained down debris minutes after launching on Thursday.
SpaceX said in a statement that it believes a fire in the vehicle led to Starship breaking apart. Videos posted on social media by people in the region showed the rocket detonating in space.

Orange balls of light fly across the sky as debris from a SpaceX rocket launched in Texas is spotted over Turks and Caicos Islands on Jan. 16, 2025.
Marcus Haworth@marcusahaworth | Marcus Haworth Via Reuters

Notably, the FAA says it activated a “Debris Response Area” to warn aircraft of debris falling “outside of the identified closed aircraft hazard areas.”
Before rocket launches, the FAA publishes “Aircraft Hazard Areas” that tell pilots where debris may fall if something goes wrong midlaunch.

A map of the “aircraft hazard areas” published before SpaceX’s seventh Starship flight.
Federal Aviation Administration

SpaceX initially published a statement on its website Thursday that Starship debris fell “into the Atlantic Ocean within the predefined hazard areas,” seemingly contradicting the FAA’s explanation for why a “Debris Response Area” was activated.
As of Friday morning, the latest SpaceX statement did not include that specific language. The company’s website said more broadly that “any surviving pieces of debris would have fallen into the designated hazard area” after the failure.
The FAA, in response to CNBC’s request for clarification on whether Starship debris landed outside the predefined hazard area, reiterated that its “information is preliminary and subject to change.” SpaceX did not respond to a request for comment.

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The Federal Trade Commission is suing PepsiCo for allegedly giving an unnamed big box retailer more favorable prices than its competition.
The unnamed retailer is Walmart, sources familiar with the matter told CNBC.
Pepsi denied the allegations and called the lawsuit partisan.

Cans of Pepsi are on display at a Target store in the Flatbush neighborhood of Brooklyn, New York City, on Feb. 9, 2024.
Michael M. Santiago | Getty Images

The Federal Trade Commission said Friday that it is suing PepsiCo for illegal price discrimination, alleging the food and beverage giant gave an unnamed retailer more favorable prices than its competition.
Walmart is the unnamed retailer, people familiar with the matter told CNBC.

The FTC alleges Pepsi violated the Robinson-Patman Act, which bars sellers from giving competing buyers different prices for the same “commodity” or selectively providing allowances, like compensation for advertising. The agency argues Pepsi gave Walmart promotional payments and allowances, as well as advertising and promotional tools, that it didn’t offer to the retail giant’s rivals.
Pepsi denied the allegations and said the FTC’s lawsuit is wrong, both factually and legally.
“PepsiCo strongly disputes the FTC’s allegations, and the partisan manner in which the suit was filed. We will vigorously present our case in court,” the company said in a statement to CNBC. “PepsiCo’s practices are in line with industry norms and we do not favor certain customers by offering discounts or promotional support to some customers and not others.”
Walmart did not immediately respond to a request for comment from CNBC.
The complaint, which was filed in the Southern District of New York, is currently sealed.

The FTC also said that a “substantial portion” of the alleged violations are redacted in the lawsuit, citing legal protections given to Pepsi and the large, big box retailer. The commission is seeking to lift the redactions to show how Pepsi broke the law and how those alleged actions led to higher prices for competing retailers.
The Robinson-Patman Act was passed in 1936, but the federal government stopped enforcing it during the deregulation of the 1980s. The FTC resumed its enforcement in December when it sued Southern Glazer’s, the largest U.S. distributor of wine and spirits.
The lawsuit comes on the final business day before President-elect Donald Trump’s inauguration on Monday, which will spell the end of Lina Khan’s time as chair of the FTC. Her Republican successor, Andrew Ferguson, currently serves on the commission and released a statement dissenting against the decision to sue Pepsi.
The Biden administration has taken a flurry of legal action against companies and corporate executives in its final days, targeting Capital One, Southwest Airlines and Elon Musk, among others.
— CNBC’s Mary Catherine Wellons contributed reporting for this story. More

The Biden administration unveiled the next 15 prescription drugs that will be subject to price negotiations between manufacturers and Medicare.
It kicks off the second phase of a landmark provision in the Inflation Reduction Act that aims to make costly medications more affordable for seniors. 
At the top of the list is Novo Nordisk’s blockbuster diabetes injection Ozempic, weight loss shot Wegovy and diabetes pill Rybelsus, which are considered one product since they all share the same active ingredient, semaglutide.

A box of Ozempic and contents sit on a table in Dudley, North Tyneside, Britain, October 31, 2023. 
George Frey | Reuters

The Biden administration on Friday unveiled the next 15 prescription drugs that will be subject to price negotiations between manufacturers and Medicare, kicking off the second phase of a landmark process that aims to make costly medications more affordable for seniors. 
Topping the list are Novo Nordisk’s blockbuster diabetes injection Ozempic, weight loss shot Wegovy and diabetes pill Rybelsus, which are considered one product in the talks since they all share the same active ingredient: semaglutide. Those treatments fueled the rise of the red-hot obesity market and have been difficult for patients to access due to cost, insurance coverage and supply constraints. 

The agreed-upon prices for the second wave of drugs are scheduled to go into effect in 2027.
Here are the 15 drugs subject to the initial talks this year: 

Ozempic, Wegovy, Rybelsus, (semaglutide,) made by Novo Nordisk, is used for Type 2 diabetes, weight management, and cardiovascular health
Trelegy Ellipta, made by GSK, is an inhaler used for chronic obstructive pulmonary disease and asthma
Xtandi, made by Pfizer, is used to treat prostate cancer in men
Pomalyst, made by Bristol Myers Squibb, is used to treat a blood cancer called multiple myeloma and a cancer that develops in people with HIV
Ibrance, made by Pfizer, is used to treat certain breast cancers
Ofev, made by Boehringer Ingelheim, is used to treat chronic lung diseases in adults.
Linzess, made by AbbVie and Ironwood Pharmaceuticals, is used to treat irritable bowel syndrome and chronic constipation
Calquence, made by AstraZeneca, is used to treat certain types of blood cancer 
Austedo, Austedo XR, made by Teva Pharmaceuticals, is used to treat involuntary movements caused by tardive dyskinesia or Huntington’s disease
Breo Ellipta, made by GSK and Theravance, is an inhaler used to treat chronic obstructive pulmonary disease
Tradjenta, made by Boehringer Ingelheim and Eli Lilly, is used for Type 2 diabetes management 
Xifaxan, made by Salix Pharmaceuticals, is used to treat diarrhea caused by traveling or irritable bowel syndrome
Vraylar, made by AbbVie, is used to treat schizophrenia, bipolar I disorder, and major depressive disorder
Janumet, Janumet XR, made by Merck, is used to manage Type 2 diabetes
Otezla, made by Amgen, is used to treat plaque psoriasis, psoriatic arthritis, and oral ulcers

President Joe Biden’s Inflation Reduction Act gave Medicare the power to directly hash out drug prices with manufacturers for the first time in the federal program’s nearly 60-year history. Some congressional Democrats and consumer advocates have long pushed for the change, as many seniors around the country struggle to afford care.
About 5.3 million people with Medicare Part D coverage used the 15 drugs in the second round of talks to treat various conditions, such as asthma, cancer and Type 2 diabetes, between Nov. 1, 2023, and Oct. 31, 2024, according to a release from the Department of Health and Human Services on Friday. The group of medicines also accounted for roughly $41 billion, or 14%, of total Part D prescription drug costs during that time period, the release added.
When combined with the the 10 medications selected for the first cycle of negotiations, the 25 products represent 36% of all Medicare Part D prescription drug costs during that time period, the release said.

The drugs have been on the market for at least seven years without generic competitors, or 11 years in the case of biological products such as vaccines. 
Medicare has already completed negotiations for the first 10 drugs selected in the program, with new prices set to go into effect next year. In August, the Biden administration said it expects those negotiated prices to save Medicare enrollees around $1.5 billion in out-of-pocket costs in 2026 alone. The government also expects the prices to lead to around $6 billion in net savings for the Medicare program in 2026, or 22% net savings overall.
But it’s unclear whether President-elect Donald Trump could try to change or scale back some of the law’s provisions when he takes office next week. 
The negotiation program has also faced a flurry of – so far unsuccessful – legal challenges from the pharmaceutical industry, which views the process as a threat to its revenue growth, profits and drug innovation. 
Medicare covers roughly 66 million people in the U.S., and 50.5 million patients are currently enrolled in Part D plans, according to health policy research organization KFF.
Almost 10% of Medicare enrollees ages 65 and older, and 20% of those under 65, report challenges in affording drugs, a senior administration official told reporters last year. 
“Last year we proved that negotiating for lower drug prices works. Now we plan to build on thatrecord by negotiating for lower prices for 15 additional important drugs for seniors,” HHS Secretary Xavier Becerra said in a release. “Today’s announcement is pivotal – the Inflation Reduction Act is lowering prices for people on Medicare. HHS will continue negotiating in the best interest of people with Medicare to have access to innovative, life-saving treatments at lower costs.”
Patient advocacy groups, such as nonprofit AARP, applauded the announcement on Friday.
“For too long, big drug companies have padded their profits by setting outrageous prices at the expense of American lives, forcing seniors to skip prescriptions they can’t afford,” AARP said in a statement. “The first round of Medicare drug price negotiation made it clear that this process will reduce the prices of these important products and create billions of dollars in savings for Medicare and its beneficiaries.”

What’s next in the Medicare price talks? 

Drugmakers will have until Feb. 28 to decide whether to participate in the program. If a drugmaker declines to negotiate, it must either pay an excise tax of up to 95% of its medication’s U.S. sales or pull all of its products from the Medicare and Medicaid markets. 
Those that participate will engage in a lengthy negotiation process involving months of back-and-forth price offers with Medicare. The federal program determines its initial offer for each medication using sales volume data, the level of federal financial support for the drug’s development and data on pending or approved patent applications and exclusivities, among other information.
After the second round concludes, Medicare can negotiate prices for another 15 drugs that will go into effect in 2028. The number rises to 20 negotiated medications a year starting in 2029. 
The government will only select Medicare Part D drugs for the first two round of negotiations. It will add more specialized medications covered by Medicare Part B, which are typically administered by doctors, in 2028.
But drugmakers will have more opportunities to negotiate with Medicare, based on the final guidance released last year for the second round of price talks. The first optional negotiation meetings will take place after Medicare makes its initial price offers for the 15 drugs, which must be presented by June 1. More

Amazon-backed Zoox is hoping to succeed in commercializing robotaxi operations in 2025.
The company plans to start rides to the public “quite soon,” expand its operating regions and grow its self-driving vehicle fleet from the couple dozen it currently operates.
Las Vegas is expected to be Zoox’s first commercial market, and it hopes to launch an “Early Rider Program” there in the coming months before opening it up to the general public later this year.

A Zoox robotaxi sits outside the company’s large office and warehouse in Las Vegas.
Michael Wayland / CNBC

LAS VEGAS — This year is expected to be a crucial one for Amazon’s autonomous vehicle unit Zoox, as the company plans to grow its operations and commercialize its robotaxi business.
Zoox is aiming to begin offering rides to the public “quite soon,” expand its operating regions and “significantly” grow its self-driving vehicle fleet from the couple dozen it currently operates, according to co-founder and Chief Technology Officer Jesse Levinson.

“That’s a lot of work, but we’re excited for that,” Levinson said during a 40-minute drive around Las Vegas in one of the company’s robotaxis. “We’re pretty happy with the progress we’ve made.”
Zoox’s plans come even as some investors have lost enthusiasm for autonomous vehicles, and they’re not alone as legacy automakers such as General Motors, Ford Motor and Volkswagen have disbanded self-driving units in recent years.
Zoox, founded a decade ago and purchased by Amazon for $1.3 billion in 2020, has been testing its purpose-built robotaxis on public roads since early 2023. It is currently testing the vehicles, which do not include manual controls such as a steering wheel or pedals, in three cities: Las Vegas; San Francisco; and Foster City, California, where it is headquartered.

A row of Zoox robotaxis sit inside the company’s large office and warehouse in Las Vegas.
Michael Wayland / CNBC

Las Vegas is expected to be Zoox’s first commercial market. The company is hoping to launch an “Early Rider Program” in Sin City in the coming months before opening it up to the general public later this year. San Francisco, where Zoox began testing in November 2024, will follow, the company said.
Levinson said Zoox also is eyeing an expansion to Miami; Austin, Texas; and others, but the company has not announced a set timeframe for those cities.

“Hopefully by the end of this decade, if you’re in most of the major cities in the U.S., this will be your favorite way to get around,” Levinson said.
Amazon does not publicly disclose its investments in Zoox or other early-stage business, saying such investments are viewed as emerging, long-term initiatives to assist the company and its customers.

Riding in a robotaxi

The Zoox robotaxi differs from others, as it was developed from the start to not have a human driver. That is a different path from Alphabet-backed Waymo — the U.S. leader in robotaxis — which has retrofitted traditional vehicles to have autonomous vehicle capabilities.

Zoox co-founder and Chief Technology officer Jesse Levinson.
Courtesy image

Some have described vehicles such as Zoox’s robotaxis as “boxes” or “toasters.” The doors open from the middle, with rows of seats facing each other, and there’s no space for a driver. GM’s Cruise also had plans to launch such a vehicle, the Origin, but canceled production as the company faced problems following an accident involving a pedestrian in October 2023.
“The vehicle itself, I think, is quite interesting,” Sam Abuelsamid, an autonomous expert and vice president of market research at Telemetry Insights, said about Zoox. “It’s kind of the right size of vehicle, the right kind of form factor.”
During a sunny morning driving around the outskirts of the Las Vegas Strip, the Zoox autonomous vehicle handled well. It made turns as it should and drove assertively, but not aggressively. There were some questionable choices during the ride, such as opting to stay in a long line of vehicles and not navigating around a large trailer, but overall, the vehicle operated as it should.
Driving assertively is something the Amazon-backed company has been working on during years of testing, Levinson said. An autonomous vehicle cannot break laws like many human drivers, but it also cannot be too cautious or aggressive because that can lead to accidents or incidents with other human drivers.

Future of the business

Test and data-capture vehicles inside Zoox’s large office and warehouse in Las Vegas.
Michael Wayland / CNBC 

If Zoox can grow as planned this year and begin commercial operations, it would arguably be a far second in the robotaxi business to Waymo.
“I don’t want to imply that it’ll be a commercially meaningful business this year … but it’s going to be useful in terms of customers will be able to get value out of it and actually use it to go places. We’re excited for that,” Zoox’s Levinson said. “We’ve taken a pretty conservative and steady approach to scaling and rolling out, just because of the safety-critical nature.”
GM’s Cruise autonomous vehicle unit was considered a leader with Waymo until the company grounded its robotaxi fleet and announced the end of its commercial operations late last year. That came after a October 2023 accident in which external probes found the company misled or deceived regulators about the incident.
Offering public rides is just another step in the challenging commercialization of autonomous vehicles. Waymo started offering supervised rides to the public in Arizona in 2017, followed by unsupervised driverless rides in 2019. It has slowly expanded to hundreds of autonomous vehicles in four markets that are now conducting more than 150,000 paid rides a week.
“From a technology standpoint, I think that Zoox is going in the right direction. What I’m somewhat less convinced about is the business model,” Abuelsamid said. “The technology is maturing. It’s still not perfect, but it’s getting better.
“But everybody’s trying to figure out what’s the operating model that will actually be able to cover the cost and make this money,” he continued.

The robotaxi industry has proved to be far more challenging than many thought toward the end of the 2010s, when GM, Waymo, Lyft, Uber and many others entered the market with grand ambitions of commercializing the technology and removing the human driver from driving.
Companies have proven self-driving vehicles can work, but the costs have been far greater than initially anticipated with longer-than-expected paybacks. Not to mention that several reported on-road issues, as well as faced uncertainty surround regulations and liabilities.
Others, most notably Tesla, have declared ambitions for robotaxi businesses, but have failed to develop driverless vehicles or commercial, driverless ride-hailing operations.
Meanwhile, Waymo continues to expand. Last year, it announced an expanded partnership with Uber to bring its robotaxi services to Austin and Atlanta, only on the Uber app, beginning in early 2025. Waymo also expects to expand to Miami in early 2026.
“They’re absolutely the leader,” Abuelsamid said. “They’re the only ones operating any kind of real robotaxi service today, at any kind of scale; they’re far away the biggest.”

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SpaceX launched the seventh test flight of its Starship rocket on Thursday, but lost communication with the uncrewed upper stage of the rocket that continues on into space.
“We can confirm that we did lose the ship,” SpaceX senior manager of quality systems engineering Kate Tice said.
The Federal Aviation Administration issued a warning to pilots of a “dangerous area for falling debris of rocket Starship,” according to a notice.

SpaceX’s mega rocket Starship launches for a test flight from Starbase in Boca Chica, Texas, Thursday, Jan. 16, 2025.
Eric Gay | AP

SpaceX launched the seventh test flight of its Starship rocket on Thursday, but lost communication with the upper stage of the rocket that continues on into space.
The company’s webcast showed data stopped transmitting from Starship about nine minutes into the launch.

“We can confirm that we did lose the ship,” SpaceX senior manager of quality systems engineering Kate Tice said.
SpaceX said in a post on X that the ship broke up during its ascent burn and that it would “continue to review data from today’s flight test to better understand root cause.”
After the rocket lost communication, social media users posted photos and videos of what appeared to be fireballs in the sky near the Caribbean islands. Starship’s launch trajectory takes it due east from Texas, which means the fireballs are likely debris from the rocket breaking apart and reentering the atmosphere.
The Federal Aviation Administration issued a warning to pilots of a “dangerous area for falling debris of rocket Starship,” according to a notice. Multiple flights above the Caribbean diverted and appeared to be turning around, including commercial and cargo planes of JetBlue, Spirit, and FedEx, according to flight-tracking site FlightAware.
“The FAA briefly slowed and diverted aircraft around the area where space vehicle debris was falling. Normal operations have resumed,” the regulator said in a statement.

The airlines did not immediately respond to CNBC’s request for comment. As is required for rocket launches, standard air traffic control advisories were in place. Record-breaking demand for both launches and flights means that rockets compete with planes for limited airspace, especially near Florida.
Additionally, the FAA confirmed that it was “assessing” the anomaly that occurred during SpaceX’s Starship flight. The FAA often grounds rockets after midflight failures, requiring that space companies perform a mishap investigation and put in place corrective actions before the regulator issues a new launch license.

SpaceX’s mega rocket Starship booster returns to the launch pad during a test flight from Starbase in Boca Chica, Texas, Thursday, Jan. 16, 2025.
Eric Gay | AP

Starship launched from SpaceX’s private “Starbase” facility near Brownsville, Texas, shortly after 5:30 p.m. ET. A few minutes later, the rocket’s “Super Heavy” booster returned to land at the launch site, in SpaceX’s second successful “catch” during a flight. It did not catch the booster on the last flight.
There were no people on board the Starship flight. However, Elon Musk’s company was flying 10 “Starlink simulators” in the rocket’s payload bay and planned to attempt to deploy the satellite-like objects once in space. This would have been a key test of the rocket’s capabilities, as SpaceX needs Starship to deploy its much larger and heavier upcoming generation of Starlink satellites.
While SpaceX didn’t specify what the Starlink simulators were made of, mass simulators are commonly used in rocket vehicle development and are often simple constructions of metal or concrete that weigh roughly the same as the object in question.

Read more CNBC space news

Before losing communication, Starship was set to reach space and then travel halfway around the Earth before reentering the atmosphere and splashing down in the Indian Ocean about an hour after liftoff.
As with each previous flight, SpaceX aimed to push development further by assessing additional Starship capabilities, including tests of its heatshield tiles and the trajectory of its intense reentry.

View of Space X’s Starship on the launch pad for its seventh test flight, in Boca Chica, Texas, U.S.
Maxar Technologies | Via Reuters

Starship is critical to the company’s plans, even with its $350 billion valuation and already dominant position in the space industry.
Starship is both the tallest and most powerful rocket ever launched. Fully stacked on the Super Heavy booster, Starship stands 403 feet tall and is about 30 feet in diameter. SpaceX has flown the full Starship rocket system on six spaceflight tests so far since April 2023, at a steadily increasing cadence.
The Super Heavy booster, which stands 232 feet tall, is what begins the rocket’s journey to space. At its base are 33 Raptor engines, which together produce 16.7 million pounds of thrust — about double the 8.8 million pounds of thrust of NASA’s Space Launch System rocket, which launched for the first time in 2022.
Starship itself, at 171 feet tall, has six Raptor engines — three for use while in the Earth’s atmosphere and three for operating in the vacuum of space.
The rocket is powered by liquid oxygen and liquid methane. The full system requires more than 10 million pounds of propellant for launch.

SpaceX’s mega rocket Starship and booster separate during a test flight from Starbase in Boca Chica, Texas, Thursday, Jan. 16, 2025.
Eric Gay | AP

The Starship flying on this launch, tagged as Ship 33, also represents a second-generation version of the vehicle, called “Block 2.”
SpaceX noted that the “significant upgrades” to this vehicle include changes to the flaps on the vehicle’s nose, redesigns of its propulsion system to boost performance, an enhanced flight computer, 30 cameras placed along the vehicle for monitoring the rocket and a reinforced heat shield.
Additionally, the booster for this flight attempt features a reused Raptor engine. That engine flew during the fifth test flight last year.
The Starship system is designed to be fully reusable and aims to become a new method of flying cargo and people beyond Earth. The rocket is also critical to NASA’s plan to return astronauts to the moon. SpaceX won a multibillion-dollar contract from the agency to use Starship as a crewed lunar lander as part of NASA’s Artemis moon program.
— CNBC’s Leslie Josephs contributed to this report. More