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Reps. Mike Gallagher and Raja Krishnamoorthi, leaders of the House CCP Committee, sent letters to leaders at Nike, Shein, Temu and Adidas about possible trade law violations.
Shein and Temu are further accused of using a tariff loophole to sell goods made with forced labor to U.S. customers.
The companies have been asked to respond by May 16.

A shopper carries a bag of Nike merchandise along the Magnificent Mile shopping district on December 21, 2022 in Chicago, Illinois. 
Scott Olson | Getty Images

WASHINGTON — A House committee examining the U.S. government’s economic relationship with China is asking some of the world’s largest clothing companies for information about the use of forced labor during production — a potential violation of U.S. trade law.
Lawmakers asked retailers Temu, Shein, Nike and Adidas North America about the use of materials and labor sourced from the Xinjiang Uyghur Autonomous region of China, according to letters sent to company leaders on Tuesday. Such practices would constitute violations of the 2021 Uyghur Forced Labor Prevention Act, according to the lawmakers.

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Congress passed the UFLPA with bipartisan support after the State Department determined China is “committing genocide against Uyghurs and other minority groups in Xinjiang.”
The letters were sent to Rupert Campbell, president of Adidas North America; Qin Sun, president of Temu; Chris Xu, CEO of Shein and John Donahoe, president and CEO of Nike, Inc. They were signed by Reps. Mike Gallagher, R-Wisc., chair of the House Select Committee on the Chinese Communist Party, and Ranking Member Raja Krishnamoorthi, D-Ill.
“Using forced labor has been illegal for almost a hundred years—but despite knowing that their industries are implicated, too many companies look the other way hoping they don’t get caught, rather than cleaning up their supply chains. This is unacceptable,” Gallagher in a statement. “American businesses and companies selling in the American market have a moral and legal obligation to ensure they are not implicating themselves, their customers, or their shareholders in slave labor.”
The inquiries also follow a March hearing of the committee that included an expert assessment finding that U.S. companies finance “state-sponsored forced labor programs in the Uyghur region.”
The lawmakers requested responses to their questions, including the identity of materials suppliers, supply chain policies and audit measures for suppliers, by May 16.

Representatives for the companies did not immediately respond to requests for comment from CNBC.
The latest inquiries follow a separate bipartisan effort earlier this week urging the Securities and Exchange Commission to require Shein to certify it does not use Uyghur labor before the company can expand into the U.S. market. Shein has denied the accusation.
Chinese brands Shein and Temu, which is owned by Chinese parent company PDD Holdings, are also accused of capitalizing on a 90-year-old loophole to avoid tariffs on many goods sold directly to U.S. consumers, the lawmakers said Tuesday.
The lawmakers say Shein and Temu rely heavily on the de minimus provision of Section 321 of the Tariff Act of 1930 to waive import tariffs if the fair retail value of in the country of shipment does not exceed $800. More

Leaders of the United Auto Workers are withholding a reelection endorsement for President Joe Biden until the union’s concerns about the auto industry’s transition to all-electric vehicles are addressed.
UAW President Shawn Fain says the union wants a “just transition” for workers, as the government uses taxpayer money to subsidize the EV industry.
This doesn’t mean the historically Democratic union is backing a Republican. In the Tuesday letter, Fain also noted “another Donald Trump presidency would be a disaster.”

UAW President Shawn Fain chairs the 2023 Special Elections Collective Bargaining Convention in Detroit, March 27, 2023.
Rebecca Cook | Reuters

DETROIT – Leaders of the United Auto Workers are withholding a reelection endorsement for President Joe Biden until the union’s concerns about the auto industry’s transition to all-electric vehicles are addressed, according to a Tuesday letter sent by UAW President Shawn Fain to union staff.
Fain, who was elected union president in March, said the UAW wants a “just transition” for workers. He argues that is currently not the case as automakers invest billions of dollars, with the support of taxpayer money, to move from traditional vehicles to EVs.

“The federal government is pouring billions into the electric vehicle transition, with no strings attached and no commitment to workers,” Fain said in the message obtained by CNBC. “The EV transition is at serious risk of becoming a race to the bottom. We want to see national leadership have our back on this before we make any commitments.”
How to transition traditional auto workers into new jobs for EVs has been a major concern for the UAW for several years. A 2018 study by the union found mass adoption of EVs could cost the UAW 35,000 jobs. However, the union has more recently said that number could be lower.
The UAW has historically supported Democrats. However, former President Donald Trump was able to gain notable support from blue-collar auto workers during his presidential campaign.
In the Tuesday letter, Fain said “another Donald Trump presidency would be a disaster,” citing the need for the union to “get our members organized behind a pro-worker, pro-climate, and pro-democracy political program that can deliver for the working class.”

Speaking in front of a backdrop of American-made vehicles and a UAW sign, President Joe Biden speaks about new proposals to protect U.S. jobs during a campaign stop in Warren, Michigan, September 9, 2020.
Leah Millis | Reuters

Biden’s campaign did not immediately respond to a request for comment.

Biden has been a vocal supporter of unions during his presidency, but automakers have increased investments in recent years in states with “right to work” laws.
Fain’s letter, which was first reported by The Detroit News, comes nearly two weeks after he said the union would “back the candidates that support us” in 2024.
Such messaging is a far stronger political stance than the union, which previously endorsed Biden, has taken in recent years, when former leaders and company officials were under a federal corruption investigation.
Fain and other newly elected union leaders ran as reform candidates for the union who would be more vocal and aggressive for its members.
“Right now, we’re focused on making sure the EV transition does right by our members, our families, and our communities,” Fain wrote. “We’ll be ready to talk politics once we secure a future for this industry and the workers who make it run.”
In the letter, Fain singles out the Detroit automakers for recent announcements surrounding plant closures and idling related to EVs that turned workers’ lives “upside down.” Most notably, earlier this year, Stellantis idled a Jeep plant in Illinois, citing the need to cut costs to invest in EVs.
Fain also noted the pay rate at a recently opened Ultium Cells LLC battery plant near Lordstown, Ohio — a joint venture between General Motors and LG Energy Solution — compared with that of traditional automotive assembly plants.
Ultium has said hourly workers currently make between $16 and $22 an hour with full benefits, incentives and tuition assistance. That compares to traditional hourly UAW members that can make upward of $32 an hour at GM plants.
Joint venture battery facilities are viewed as crucial for the UAW to grow and add members, as automakers such as GM transition to EVs, which require less traditional labor and parts than cars with internal combustion engines.
“The situation at Lordstown, and the current state of the EV transition, is unacceptable,” Fain said. “We expect action from the people in power to make it right. I want to make sure our staff are armed and ready with the same tone and message.”  More

When Schumpeter recently visited New York, it was at its springtime best. There were cherry blossoms in Central Park, birdsong in the bushes, and—to drown out any false sense of serenity—the usual cacophony of car horns and jackhammers in the streets. Whoosh up in elevators to the salons of Wall Street’s gilded elite, and it only gets better. The views are breathtaking, the preferences revealing—CDs lining the shelves of one legal beagle, a handkerchief in the top pocket of another. Yet if you thought such veterans had seen it all, think again. “It’s a shitload more complicated than it’s ever been,” says the boss of one bank.The hierarchy of concerns changes depending on whom you talk to. But the components are the same. An interest-rate shock not seen for more than a generation. The difficulty of doing deals when money is no longer cheap. A maverick approach to antitrust from the sheriffs in Washington, DC. The rhetorical—if not yet real—decoupling between America and China, which business is afraid to speak out against, however much it stands to lose. So it was serendipitous that one of the New York companies your columnist visited was Pfizer, at its new headquarters in Hudson Yards. The pharma giant, worth $220bn, is rare among American firms in shrugging off many of the sources of uncertainty. Its covid-related partnership with BioNTech, a German vaccine developer, has given it a strong enough balance-sheet to take higher interest rates in its stride. It is a dealmaking machine, uncowed by the trustbusters. And it remains proud of its business in China. It may be sticking its neck out. But if that helps stick a needle into the skittish rump of corporate America, all the better. You can tell Pfizer is flush with cash by visiting its new digs. The main meeting room is a futuristic “purpose circle”. The shimmering executive suites look like they belong on the starship Enterprise. A spiffy newish double-helix logo emphasises its devotion to science. The first topic of conversation is mergers and acquisitions. In little over a year it has splashed out $70bn. That includes the $43bn takeover of Seagen, a maker of cancer medicines, announced in March. It is the biggest pharma deal since 2019.Pfizer can do M&A because unlike most firms, it is not paralysed by the short-term economic outlook. Instead it is galvanised by the certainty that its covid-related bonanza is tapering off. Though sales of pandemic-related vaccines and antivirals beat Wall Street’s expectations in its first-quarter results on May 2nd, they still contributed to a 26% drop in overall revenues compared with the same period in 2022—and will fall further this year. It also faces a looming patent cliff from 2025 onwards, affecting non-covid blockbusters such as Eliquis, an anticoagulant, and Ibrance and Xtandi, two cancer drugs. To offset both of these forces, Pfizer is buying and developing a pipeline of new drugs that it hopes will boost revenues by $30bn in 2030. Like the rest of big pharma, it benefits from the fact that smaller, cash-strapped biotech firms are struggling in the high-interest-rate environment. That makes them relatively receptive to takeovers.In doing such deals, Pfizer is unintimidated by the trustbusters, who are having a chilling effect on dealmaking in other industries. Jeff Haxer of Bain & Company, a consultancy, notes that America’s Federal Trade Commission and Department of Justice are likelier to sue to stop deals taking place than tackle M&A-related competition concerns through remedies such as divestments. So far they have failed to block many transactions, but the timeline for doing deals has lengthened. That affects the cost of financing for the buyer, and raises risks that the seller could be left stranded. Pfizer has taken steps to head off the trustbusters, such as playing down cost-cutting (ie, job-threatening) “synergies”, and playing up its commitment to cancer innovation. It insists the Seagen acquisition will close by early 2024.Unlike many other American firms, Pfizer also remains unusually bullish about its business in China. It employs 7,000 people in the country, which helped bolster covid-related revenues in the first quarter. Its CEO, Albert Bourla, was one of a few bosses of well-known American firms to attend the China Development Forum in Beijing in March (Apple’s Tim Cook was another). Reuters reported that last month Pfizer signed an agreement with Sinopharm, a Chinese drugmaker, to market a dozen innovative drugs in China. It may make sense for a company with a promising business there to double down on its operations. But in a tense geopolitical climate in which many American businessmen fear a backlash if they raise their voices in defence of the trade relationship, it is bold nonetheless. So far Wall Street has given Pfizer little credit for its purposefulness. Its share price has fallen by almost a quarter this year. Critics argue that it may be overpaying for Seagen, and that the acquired drugs may not generate enough revenues to move the needle at Pfizer. They worry that pressures on drug pricing in America may end up destroying some of the economic rationale for its acquisitions. Pfizer still has its work cut out convincing investors its post-covid future is a bright one. As Mr Bourla put it: “It’s not enough to save the world. We need to increase the stock price.”Seeing the vial as half-full Other industries might argue that big pharma, with some of the juiciest margins outside the tech industry, is unrepresentative of corporate America, and offers few lessons in how to cope with the current wave of uncertainty. Yet it is worth remembering that it is often in the depths of M&A squeamishness that companies with strong balance-sheets strike the best deals. An investment banker notes that in 2009, during the global financial crisis, Pfizer paid $68bn for Wyeth, a vaccine-maker, despite misgivings on Wall Street. As luck would have it, more than a decade later that underappreciated business helped Pfizer rescue the world during the covid crisis. It can pay to be bold—even in mysterious ways. ■ More

Two 10-year-olds were among over 300 minors found to be working in violation of federal labor laws at McDonald’s restaurants across Kentucky and other states, the Labor Department said Tuesday.
Three franchisees operating 62 McDonald’s locations across Indiana, Kentucky, Maryland and Ohio were found to have violated federal labor laws.
The franchisees face over $200,000 in estimated civil money penalties.

McDonald’s location in Louisville, Kentucky.
Luke Sharrett | Bloomberg | Getty Images

More than 300 minors — including two 10-year-olds who were unpaid — were found to be working in violation of federal labor laws at McDonald’s franchise restaurants across Kentucky and other states, the U.S. Labor Department said this week.
The franchisees in total face over $200,000 in estimated civil money penalties.

The department’s Wage and Hour Division determined three separate franchisees operating 62 McDonald’s locations across Indiana, Kentucky, Maryland and Ohio violated federal labor laws by employing 305 children to work more than the legally permitted hours, as well as perform tasks illegal for young workers. Of the 62 restaurants, 45 were in Kentucky, according to department data.
“These reports are unacceptable, deeply troubling and run afoul of the high expectations we have for the entire McDonald’s brand,” Tiffanie Boyd, senior vice president and chief people officer at McDonald’s USA, said in a statement to NBC News. “It is not lost on us the significant responsibility we carry to ensure a positive and safe experience for everyone under the Arches.”
The news comes as Republican lawmakers have targeted child labor laws nationwide. This week, GOP state lawmakers in Wisconsin circulated a bill that would allow 14-year-old workers to serve alcohol in bars and restaurants. Republican-led bills have also been pushed in states like Arkansas, Iowa and Ohio that would make it easier for teenagers to work longer hours and more jobs.
Labor Department investigators discovered two 10-year-olds working unpaid as late as 2 a.m. at a McDonald’s location in Louisville, Kentucky, operated by Louisville-based Bauer Food LLC, according to a Tuesday release.
According to NBC News, Bauer Food LLC said the 10-year-olds were children of a night manager visiting their parent at work and thus were not approved by management to be in that part of the restaurant. The franchisee has taken steps to make clear to employees all policies regarding children visiting a parent or guardian at work.

That franchisee was also found to be employing 24 children under 16 to work more than legally permitted hours, according to investigators, amounting to $39,711 in civil money penalties. These hours are restricted by law to 7 a.m. to 7 p.m., except between June 1 and Labor Day when they extend to 9 p.m.
“Too often, employers fail to follow the child labor laws that protect young workers. Under no circumstances should there ever be a 10-year-old child working in a fast-food kitchen around hot grills, ovens and deep fryers,” said Karen Garnett-Civils, the Labor Department’s Wage and Hour Division district director in Louisville.
Archways Richwood LLC, based in Walton, Kentucky, was found to have allowed 242 children aged 14 and 15 to work more than the allowable hours. The Labor Department said children were found to work more than three hours on school days and earlier or later in the day than the law allows, amounting to an estimated $143,566 in penalties.
Archways Richwood LLC did not immediately respond to a request for comment.
Bell Restaurant Group I LLC, also in Louisville, was found to have allowed 39 workers aged 14 and 15 to work outside allowable hours, amounting to an estimated $29,267 in penalties, the department said.
Last year, the Labor Department division found that 688 minors were employed illegally in hazardous positions in fiscal year 2022, the highest annual count since fiscal year 2011. The division said a 15-year-old child was injured in June 2022 in Tennessee while using a deep fryer.
“One child injured at work is one too many. Child labor laws exist to ensure that when young people work, the job does not jeopardize their health, well-being or education,” said Garnett-Civils. More

The Food and Drug Administration approved GSK’s RSV vaccine for adults ages 60 and older. 
The GlaxoSmithKline shot is now the world’s first fully approved vaccine that targets respiratory syncytial virus.
The FDA’s decision is a victory for GSK in a tight race against drugmakers Pfizer and Moderna to bring an RSV vaccine to the market.
The shot will prepare the U.S. to combat the next RSV season in the fall and winter.  

A GSK lab in London.
Oli Scarff | Getty Images

The Food and Drug Administration on Wednesday approved an RSV vaccine produced by GlaxoSmithKline for use on adults ages 60 and older.
The approval, the first ever globally by a regulatory body for an RSV vaccine, is a decisive victory for GSK in a race against drugmakers Pfizer and Moderna to bring to market a shot that targets the respiratory syncytial virus.

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Shares of GSK rose nearly 2% Wednesday following the approval.
GSK’s chief scientific officer Tony Wood said in a statement the decision “marks a turning point” in the company’s effort to reduce the “significant burden” of RSV.
The company will now focus on ensuring eligible older adults in the U.S. can access the vaccine “as quickly as possible,” he said. GSK will also work toward regulatory review and approval of the shot in other countries.
London-based GSK during an earnings presentation last week said it has “millions” of doses of the RSV vaccine ready to ship. 
The company plans to meet in June with the federal Centers for Disease Control and Prevention’s vaccine advisory committee to hash out potential vaccination schedules for the U.S., according to that presentation.

GSK’s shot is also inching closer to approval in the European Union. Last week, the European Medicines Agency recommended that the company’s vaccine be approved by the EU for older adults. 
The shot would help countries combat the next RSV season in the fall. 
The U.S. suffered an unusually severe RSV season last year. 
Cases of the virus in children and older adults overwhelmed hospitals across the country, largely because the public stopped practicing Covid pandemic health measures that had helped keep the spread of RSV low. 
RSV usually causes mild, cold-like symptoms. But each year the virus kills 6,000 to 10,000 seniors and a few hundred children younger than 5, according to the CDC. 

The FDA said the approval of GSK’s vaccine was based on data from a phase three trial on older adults. 
In March, an independent panel of advisors to the FDA recommended the shot based on those trial results, which found the shot nearly 83% effective at preventing lower respiratory tract disease caused by RSV. Disease was defined as two or more symptoms including shortness of breath, wheezing, cough, increased mucus production, crackles, low oxygen saturation, or need for oxygen supplementation. 
The independent panel unanimously said the efficacy data on GSK’s vaccine was sufficient. 
But the advisors also flagged potential safety issues over a nervous system disorder, Guillain-Barre syndrome, that may be tied to the shot.
A 78-year-old woman in Japan was diagnosed with Guillain-Barre syndrome nine days after receiving GSK’s vaccine, according to an FDA briefing document. She was hospitalized for six months before being released.
The document said the woman was the only case of Guillain-Barre syndrome out of the more than 12,000 people who received the shot. 
GSK said in February that there is insufficient evidence to confirm the woman got Guillain-Barre as a result of GSK’s shot.
But the FDA said at the time that it considers the case to be related to GSK’s vaccine. 
On Wednesday, the agency said it will require GSK to conduct a study to further assess the risk of Guillain-Barre syndrome and another side effect observed in a clinical trial that co-administered the RSV shot with a flu vaccine.
Guillain-Barre syndrome is a rare disorder in which the immune system attacks its own nerves, causing muscle weakness and sometimes paralysis. Most people recover completely from the disorder, but some cases can be fatal or have lasting effects.
The rate of Guillain-Barre syndrome is typically one to two cases per 100,000 people each year in the U.S., according to the National Organization for Rare Disorders.
The FDA flagged the disorder as a potential safety issue with Pfizer’s RSV vaccine for older adults.
Two people developed Guillain-Barre syndrome after receiving Pfizer’s shot in a late-stage clinical trial with more than 20,000 vaccine recipients.
Pfizer in February said it will conduct a safety study to further assess Guillain-Barre syndrome if the FDA approves its vaccine.
The pharmaceutical company is hoping to win that approval later this month.
No cases of Guillain-Barre syndrome were identified during a clinical trial of Moderna’s RSV vaccine.
Moderna plans to file an application for FDA approval during the first half of this year.  More

Darden Restaurants is buying the parent company of Ruth’s Chris Steak House for $715 million.
Ruth’s will join Darden’s fine-dining portfolio, which already includes The Capital Grille and Eddie V’s.
The steakhouse has more than 150 locations worldwide and generated $505.9 million in revenue in 2022.

A pedestrian wearing a protective mask walks past a Ruth’s Chris restaurant in Washington, D.C., on Monday, April 20, 2020.
Andrew Harrer | Bloomberg via Getty Images

Darden Restaurants said Wednesday it is buying Ruth’s Hospitality Group, the parent company of Ruth’s Chris Steak House, for $715 million.
The deal values Ruth’s at $21.50 per share in an all-cash transaction. The steakhouse has more than 150 locations worldwide and generated $505.9 million in revenue in 2022.

Ruth’s shares spiked nearly 34% in premarket trading, after closing Tuesday at about $16 per share. Darden’s stock was flat.
Ruth’s will join Darden’s fine-dining portfolio, which already includes The Capital Grille and Eddie V’s. In Darden’s most recent quarter, its fine-dining restaurants reported same-store sales growth of 11.7%. The segment’s average weekly sales had more than doubled compared with pre-pandemic levels.
The steakhouse is Darden’s first acquisition in six years. It bought Cheddar’s Scratch Kitchen in 2017 for $780 million. CEO Rick Cardenas signaled in January that the company was looking to add a tenth chain to its portfolio, for the right price.
Darden plans to hold a conference call Thursday at 8:30 a.m. ET to discuss the deal.
The agreement breaks a drought for restaurant dealmaking. Rising interest rates have made acquisitions more expensive.

On top of that, many restaurant giants like Yum Brands and Restaurant Brands International have instead focused on turning around the laggards in their portfolios and expanding their newer chains. A turbulent stock market, inflation and concerns about a recession have also kept some restaurant chains from going public.
But one big deal is expected on the horizon: the upcoming sale of Subway. The sandwich chain is reportedly seeking at least $10 billion to end more than five decades of family ownership.
Darden’s acquisition of Ruth’s precedes the steakhouse’s first-quarter earnings report, which is expected to be released before the bell on Friday. The company said Wednesday it is canceling the conference call scheduled for that morning.
Last quarter, Ruth’s reported same-store sales growth of 4.5%.
Darden expects that acquisition and integration expenses will cost the company between $55 million and $60 million. But it also anticipates $5 million to $10 million in pre-tax synergies in the first year and an additional $15 million to $20 million in the second year.
The deal is expected to close in June if customary closing conditions are met. Ruth’s CEO Cheryl Henry will stay on as president of Ruth’s Chris and report to Cardenas.
Ruth’s Chris was founded in 1965 after Ruth Fertel bought Chris Steak House in New Orleans. The terms of the sale kept her from reusing the name at other locations, so she chose to name new locations Ruth’s Chris Steak House. The company went public in 2005.
As of Tuesday’s close, Darden’s stock had risen nearly 10% this year, giving it a market value of $18.4 billion. Ruth’s shares had increased 3% this year as of Tuesday, bringing its market value up to $525 million. More

Johnson & Johnson’s consumer health business Kenvue is expected to go public this week in the largest U.S. IPO in more than a year. 
Kenvue is expected to set an initial public offering price Wednesday night and trade Thursday morning.
The spinoff will list on the New York Stock Exchange under the ticker “KVUE.”
That business unit is chock full of household names such as Tylenol, Band-Aid, Listerine, Aveeno, Neutrogena and J&J’s namesake baby powder and shampoo.

Johnson & Johnson products on a shelf in a store in New York.
Lucas Jackson | Reuters

Johnson & Johnson’s consumer health business, Kenvue, is expected to go public this week in the largest U.S. IPO in more than a year. 
That business is chock full of household names familiar to investors and the larger public, such as Tylenol, Band-Aid, Listerine, Aveeno, Neutrogena and J&J’s namesake baby powder and shampoo. 

Kenvue is expected to set an IPO price Wednesday night and start trading Thursday morning on the New York Stock Exchange under the ticker “KVUE.” 
The company aims to sell more than 151 million shares in the IPO at between $20 to $23 each, the company said in a preliminary prospectus filed with the Securities and Exchange Commission last week. That would raise roughly $3.25 billion at the midpoint price of $21.50. 
Proceeds from the offering and any profits from related debt-financing transactions will go to J&J, but Kenvue will retain $1.17 billion in cash and cash equivalents.
Kenvue would be valued at around $40 billion at the proposed share range, based on the 1.87 billion shares expected to be outstanding once the deal closes. J&J would hold nearly all of those outstanding shares, amounting to more than 1.71 billion shares, according to the prospectus.
Goldman Sachs, JPMorgan Chase and Bank of America are acting as the lead underwriters for the IPO. 

If successful, Kenvue would be the biggest IPO since EV maker Rivian went public in November 2021.
The spinoff alone may not completely turn around the moribund IPO market, which plummeted in 2022. But it may be a sign of life for initial public offerings in the U.S. 
Kenvue’s debut would also mark the largest restructuring in J&J’s 135-year history. J&J announced the split in late 2021 as a bid to streamline operations and refocus on its pharmaceutical and medical device divisions. 
Here’s everything else you need to know about Kenvue’s upcoming IPO this week. 

Ownership after IPO

J&J will control 91.9% of Kenvue after the IPO — or 90.8% if underwriters exercise their options to purchase additional shares, according to the prospectus filing.
J&J plans to distribute the remaining shares of common stock to its shareholders later this year.
Until then, Kenvue will qualify as a “controlled company” under the corporate governance rules of the NYSE, the filing said. That will allow Kenvue to avoid certain listing standards, including a requirement that the company’s board be composed of a majority of independent directors. 
J&J will generally be able to control matters that shareholders vote on, such as the election of directors to Kenvue’s board, the filing said. 
“Johnson & Johnson will continue to control the direction of our business, and the concentrated ownership of our common stock may prevent you and other shareholders from influencing significant decisions,” Kenvue said in the filing. 

Business performance 

Kenvue is profitable and expects modest growth over the next few years, the company said in the filing.
Annual sales growth through 2025 is projected to be about 3% to 4% globally, according to the filing.  
Kenvue posted $14.95 billion in sales for 2022 and a net income of $1.46 billion on a pro forma basis. For the first quarter that ended April 2, Kenvue estimates it raked in sales of $3.85 billion and net income of around $330 million. Those first-quarter results are preliminary.
Ten of Kenvue’s brands had approximately $400 million or more in sales last year.
Overall, Kenvue said 2022 sales were “well balanced” across the company’s three business divisions.
The company’s self care unit, which includes products for eye care, cough and cold and vitamins, generated $6 billion in net sales for 2022, accounting for 40% of total revenue.
Skin health and beauty products accounted for $4.4 billion in net sales last year, or 29% of overall revenue. Among those products are shampoos, conditioners, hair loss treatments and skin care. 
And products in the essential health division, including baby products, mouthwash and dental rinses, sanitary protection and wound care, saw $4.6 billion in net sales, representing 31% of all-in revenue.
Each of the three divisions was profitable on an adjusted operating income basis, the company said in the filing.
Kenvue noted that its global footprint is “well balanced geographically,” with roughly half of 2022 net sales coming from outside North America. 
The company will have net debt of $7.75 billion, according to the filing.

Executive management

Kenvue rounded up several J&J executives to helm the company, according to the filing. 
Thibaut Mongon, J&J’s executive vice president and worldwide chair of consumer health, will serve as CEO of the newly public company. He will also sit on the board.
Paul Ruh, J&J’s chief financial officer of consumer health and a former PepsiCo executive, will serve as CFO, and Meredith Stevens, J&J’s worldwide vice president of the company’s consumer health supply chain department, will serve as COO.
Kenvue’s chief people office, chief corporate affairs office, chief technology and data officer, chief scientific officer and group presidents for different regions around the world are also from J&J. 
The executives will lead a team of more than 22,000 employees across 165 countries and 25 in-house manufacturing sites, according to the preliminary prospectus. 
Kenvue’s global headquarters will be in Summit, New Jersey. 

Talc-cancer lawsuits 

J&J faces thousands of allegations that its talc baby powder and other talc products caused cancer. Some of those products fall under the company’s consumer health business.
But Kenvue will only assume talc-related liabilities that arise outside of the U.S. and Canada, according to its IPO filing from January.
“As unequivocally and unambiguously stated, Johnson & Johnson has agreed to retain all the talc-related liabilities – and indemnify Kenvue for any and all costs – arising from litigation in the United States and Canada,” Erik Haas, vice president of litigation for Johnson & Johnson said in a statement last week.
But Kenvue said in the filing that “such indemnity may not be sufficient” to protect the new company against the full amount of liabilities. 
J&J will continue battling talc claims in bankruptcy court. 
A federal bankruptcy judge last month temporarily halted nearly 40,000 talc lawsuits through mid-June. That decision was part of J&J’s second attempt to settle talc claims in bankruptcy proceedings.
The temporary hold will give J&J time to try to win court approval of its $8.9 billion proposed settlement with plaintiffs in the talc cases. More

CVS Health reported revenue of $85.28 billion, an 11% increase over the year-earlier period.
The company booked $2.20 cents in adjusted earnings per share in the quarter, beating Wall Street expectations of $2.09.
But CVS also lowered its earnings guidance for the year, reflecting costs related to recent acquisitions.

CVS Health on Wednesday reported first-quarter results that beat earnings and revenue expectations, but the company lowered its full-year profit guidance due to costs related to recent acquisitions.
Shares fell more than 1% in premarket trading Wednesday.

Here’s what CVS reported compared with Wall Street’s expectations, based on a survey of analysts by Refinitiv:

Earnings per share: $2.20 adjusted, vs. $2.09 expected
Revenue: $85.28 billion, vs. $80.81 billion expected

For the quarter ended March 31, CVS posted profit of $2.14 billion, or $1.65 a share, compared with $2.35 billion, or $1.77 a share, a year earlier. Excluding one-time items, the company reported earnings of $2.20 per share for the period.
CVS reported total revenue of $85.28 billion, an 11% increase over the $76.83 billion a year earlier.
CVS lowered its 2023 adjusted earnings guidance to a range of $8.50 to $8.70, which is 20 cents lower than its previous projection of $8.70 to $8.90.
The company lowered its guidance due to costs associated with its $8 billion acquisition of Signify Health and its $10.6 billion purchase of Oak Street Health, among other items.

CVS’ health services segment booked revenue of $44.59 billion, a 12.6% increase over sales of $39.62 billion in the same quarter last year. The division includes its pharmacy benefit manager CVS Caremark and health-care services delivered in medical clinics, through telehealth and at home.
Pharmacy claims processed in this division increased 3.7% compared to first quarter 2022 due in part to an elevated cough, cold and flu season.
CVS’ health insurance segment generated revenue of $25.88 billion, a 12% increase from the year before. The division includes Aetna Affordable Care Act, Medicare Advantage, Medicaid and dental and vision plans. Total membership in CVS medical plans increased by 1.1 million to 25.5 million.
The insurance plans’ medical benefit ratio increased to 84.6% from 83.4% a year earlier. This ratio is a measure of total medical expenses paid relative to premiums collected. A lower ratio typically indicates that the company collected more in premiums than it paid out in benefits, resulting in higher profitability.
And CVS’ retail segment booked revenues of $27.92 billion, and increase of 7.8% compared to sales of $25.89 billion in the first quarter of 2022. The division includes prescriptions dispensed in its 9,900 brick-and-mortar drug stores, infusion services, testing and vaccine administration.
Prescriptions filled increased 2.5% compared to the same period last year, again due in part to the elevated cough, flu and cold season. The increase was offset in part by a decline in Covid vaccinations. Excluding this, prescriptions filled increased 4.5%.

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