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Two experts see major challenges facing the adoption of new obesity drugs.
Dr. Kavita Patel, a physician and NBC News medical contributor, believes fresh data from Novo Nordisk on Ozempic’s ability to delay the progression of chronic kidney disease is among the strongest supporting evidence for secondary uses of the drug.

However, she considers data supporting the use of obesity drugs for other conditions including Alzheimer’s and alcohol addiction as underdeveloped.
“Those trials … are nowhere near as robust as the data we have on [Novo Nordisk trial] FLOW, on sleep apnea, cardiovascular risks, on diabetes control — double-blind placebo, randomized controlled trials that are incredible,” she told CNBC’s “Fast Money” on Wednesday. “We have a long way to go for that. I’ve seen a lot of miracle drugs before.”
Novo Nordisk halted FLOW on Tuesday. According to the company’s press release, it happened more than a year after an interim analysis showed that Ozempic could treat chronic kidney disease in Type 2 diabetic patients.
As of Friday’s close, Novo Nordisk is up 9.82% since its announcement. Its obesity drug maker competitor Eli Lilly is up 5.16% in the same period.
Patel believes efficacy is just one of the major hurdles the medication needs to clear before it can be approved for uses outside of diabetes management.

“We know this drug works really well in diabetics. But there are so many barriers to getting there —including cost, adherence, prescriber rate,” said Patel, who also served as a White House Health Policy Director under President Obama.
Patients opting to use GLP-1 drugs — a group of medications initially designed to control diabetes — for weight management often must pay out-of-pocket.
“Right now, we are seeing active employers, entire states that are declining to cover on the weight loss indication,” Patel said.

If the U.S. Food and Drug Administration approves Ozempic for use in Type 2 diabetics with chronic kidney disease, which Patel believes will happen, it could force the hand of insurance companies to expand their coverage of the drug.
“We’ll see a final package of data that will just be so compelling, that it would be wrong not to cover this, because it should be superior to what we have available to us,” she noted. “That is something that I think the insurance companies will have a difficult time [with].”
Mizuho Health Care Sector Strategist Jared Holz also expects challenges related to insurance coverage as more patients begin taking GLP-1 drugs, which could limit overall adoption.
“The payers, at some point, are going to be saying, ‘We get it, but we cannot pay for these at this volume without seeing the benefit, which may be 10 years from now, 20 years from now, 30.’ We have no idea when the offset is going to be,” he also told CNBC’s “Fast Money.”
Holz also pointed out the divide emerging in the health care sector between Novo Nordisk, Eli Lilly and their pharmaceutical peers.
“We haven’t seen this kind of valuation disconnect between the peer group, maybe in the history of the sector,” he said.
The growth trend may not be sustainable for Novo Nordisk and Eli Lilly, based on current supply constraints that have left patients unable to secure dosages.
“The companies can’t make enough, I don’t think, to actually put out revenue that’s going to appease investors, given where the stocks are trading,” said Holz.
A Novo Nordisk spokesperson did not offer a comment due to the company’s quiet period ahead of earnings. Eli Lilly did not immediately respond to a request for comment.

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A Wells Fargo customer uses the ATM at a branch in San Bruno, California, on Aug. 8, 2023.
Justin Sullivan | Getty Images

Wells Fargo on Friday surpassed Wall Street expectations for third-quarter earnings and revenue as the benefit from higher interest rates offset slowing lending activity.
Shares of the bank rose 2.4% in premarket trading.

Wells Fargo posted earnings per share of $1.48 in the quarter, or $1.39 excluding discrete tax benefits. It was unclear what the exact comparable number was to Wall Street’s expectations, but both figures are higher than the LSEG consensus EPS of $1.24. The earnings are also significantly higher than the 86 cents per share earned in the same quarter a year ago.
Total revenue came to $20.9 billion during the quarter, beating the consensus estimate of $20.1 billion, according to LSEG, formerly known as Refinitiv. Revenue was 6.5% higher than the $19.6 billion recorded in the third quarter of 2022.
“Our revenue growth from a year ago included both higher net interest income and noninterest income as we benefited from higher rates and the investments we are making in our businesses,” Wells CEO Charlie Scharf said in a statement.
“While the economy has continued to be resilient, we are seeing the impact of the slowing economy with loan balances declining and charge-offs continuing to deteriorate modestly,” Scharf added.
Net income rose to $5.77 billion in the three months ended Sept. 30 from $3.59 billion a year earlier, driven by an 8% increase in net interest income.
Wells Fargo said provision for credit losses in the quarter included a $333 million increase in the allowance for credit losses for commercial real estate office loans and higher credit card loan balances. More

JPMorgan topped analysts’ expectations for both profit and revenue in the third quarter.
“This may be the most dangerous time the world has seen in decades,” CEO Jamie Dimon said in a release, referring to conflicts in the Ukraine and Israel and the possible impacts on global markets.

JPMorgan Chase on Friday topped analysts’ expectations for third-quarter profit and revenue as the bank generated more interest income than expected, while credit costs were lower than expected.
Here’s what the company reported:

Earnings: $4.33 a share
Revenue: $40.69 billion, vs. $39.63 billion LSEG estimate

The bank said profit surged 35% to $13.15 billion, or $4.33 a share, from a year earlier. That figure was not immediately comparable to the LSEG estimate of $3.96 a share; JPMorgan had a $665 million legal expense in the quarter that if excluded from results would’ve boosted per share earnings by 22 cents.
Revenue climbed 21% to $40.69 billion, helped by the stronger-than-expected net interest income. That measure surged 30% to $22.9 billion, exceeding analysts’ expectations by roughly $600 million. At the same time, credit provisioning of $1.38 billion came in far lower than the $2.39 billion estimate.
JPMorgan shares climbed 1% in premarket trading.
CEO Jamie Dimon acknowledged that the biggest U.S. bank by assets was “over-earning” on net interest income and “below normal” credit costs that will both normalize over time. While surging interest rates caught some smaller peers off guard this year, causing upheaval among regional lenders in March, JPMorgan has navigated the turmoil well so far.
Dimon warned that while American consumers and businesses were healthy, households were spending down cash balances and that tight labor markets and “extremely high government debt levels” meant that interest rates may climb even further from here.

“The war in Ukraine compounded by last week’s attacks on Israel may have far-reaching impacts on energy and food markets, global trade, and geopolitical relationships,” Dimon said. “This may be the most dangerous time the world has seen in decades. While we hope for the best, we prepare the firm for a broad range of outcomes.”
The report comes after a period of uncertainty for U.S. banks.
Bank stocks plunged last month after the Federal Reserve signaled it would keep interest rates higher for longer than expected to fight inflation amid unexpectedly robust economic growth. The 10-year Treasury yield, a key figure for long-term rates, jumped 74 basis points in the third quarter. One basis point equals one-hundredth of a percentage point.
Higher rates hit banks in several ways. The industry has been forced to pay up for deposits as customers shift holdings into higher-yielding instruments like money market funds. Rising yields mean the bonds owned by banks fall in value, creating unrealized losses that pressure capital levels. And higher borrowing costs tamp down demand for mortgages and corporate loans.
Shares of JPMorgan have climbed 8.7% this year through Thursday, far outperforming the 19% decline of the KBW Bank Index.
Wells Fargo posted results on Friday, and so did Citigroup. Bank of America and Goldman Sachs report Tuesday, and Morgan Stanley discloses results on Wednesday.
This story is developing. Please check back for updates. More

Revenue and net income rose by 9% and 2%, respectively, year over year.
Citigroup’s institutional clients unit reported $10.6 billion in revenue, up 12% year over year and 2% from the second quarter.
Citigroup’s stock was down 8% for the year entering Friday.

Citigroup reported its third-quarter results on Friday morning, with solid growth in both institutional clients and personal banking fueling higher-than-expected revenue.
Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by LSEG, formerly known as Refinitiv:

Earnings per share: $1.63. Not comparable to the expected $1.21 due to divestitures. Excluding divestitures, earnings per share were $1.52.
Revenue: $20.14 billion, vs. expected $19.31 billion

Revenue and net income rose by 9% and 2%, respectively, year over year.
Citigroup’s institutional clients unit reported $10.6 billion in revenue, up 12% year over year and 2% from the second quarter. The personal banking and wealth management division generated $6.8 billion in revenue, up roughly 10% year over year and 6% from the second quarter.
“Despite the headwinds, our five core, interconnected businesses each posted revenue growth resulting in overall growth of 9%,” CEO Jane Fraser said in a press release.

Jane Fraser CEO, Citi, speaks at the 2023 Milken Institute Global Conference in Beverly Hills, California, May 1, 2023.
Mike Blake | Reuters

Shares of the bank rose 2% in premarket trading. Citigroup’s stock was down 8% for the year entering Friday.
Among other banks that reported quarterly results on Friday morning, JPMorgan and Wells Fargo both showed stronger-than-expected revenue numbers in their third-quarter reports.

Citigroup reported $1.84 billion in total cost of credit at the end of the quarter, up slightly from $1.82 billion at the end of the second quarter and $1.37 billion a year ago. That metric includes a net build of $125 million in the allowance for credit losses during the third quarter.
Citigroup will discuss the results in a conference call later Friday morning. Investors will be looking for more detail about the reorganization of the bank under Fraser.
Friday’s earnings report includes the period during which Fraser announced that the bank would be divided into five main business lines, the latest change for the CEO since taking over in March 2021. The new structure, announced on Sept. 13, is expected to include job cuts.
Another initiative under Fraser has been Citi selling off its retail banking business in some international markets. The latest move on that front came on Oct. 9, when the bank announced that it had struck a deal to sell its onshore consumer wealth portfolio in China. More

“This may be the most dangerous time the world has seen in decades,” CEO Jamie Dimon said in a statement that accompanied the bank’s earnings news release.
Beyond the military conflicts in Ukraine and Israel, Dimon cited the burgeoning national debt and “the largest peacetime fiscal deficits ever.”

Jamie Dimon, Chairman of the Board and Chief Executive Officer of JPMorgan Chase & Co., gestures as he speaks during an interview with Reuters in Miami, Florida, U.S., February 8, 2023. 
Marco Bello | Reuters

Beyond the military conflicts, Dimon cited the burgeoning national debt and “the largest peacetime fiscal deficits ever” that he said are raising the risks that inflation and interest rates remain high.
Along with the high rates, he mentioned the Federal Reserve’s efforts to reduce its bond holdings. The process, known as quantitative tightening, “reduces liquidity in the system at a time when market-making capabilities are increasingly limited by regulations,” he said.
Dimon recently has said that he has been warning clients about the possibility that interest rates may not only stay elevated but also could rise significantly from here.
“While we hope for the best, we prepare the Firm for a broad range of outcomes so we can consistently deliver for clients no matter the environment,” he said.
JPMorgan Chase showed a $13.15 billion, or $4.33 a share, profit for the July-through-September period, a 35% jump from a year ago. Dimon further cautioned that the performance came from benefits to net interest income and credit costs that likely won’t last. More

The U.K.’s Competition and Markets Authority gave the green light to Microsoft’s proposed $69 billion takeover of gaming firm Activision Blizzard, removing the last major hurdle for the deal to close.
Microsoft first proposed the acquisition of Activision Blizzard in January 2022 but has faced regulatory challenges in the U.S., Europe and U.K ever since.
Regulators were concerned that the takeover would reduce competition in the gaming market, in particular around the nascent area of cloud gaming.

Britain’s top competition watchdog on Friday gave the green light to Microsoft’s proposed $69 billion takeover of gaming firm Activision Blizzard, removing the last major hurdle for the deal to close.
The Competition and Markets Authority said it had cleared the deal for Microsoft to buy Activision but without cloud gaming rights.

“The new deal will stop Microsoft from locking up competition in cloud gaming as this market takes off, preserving competitive prices and services for UK cloud gaming customers,” the regulator said in a statement Friday.
The CMA was the final regulator holding up the deal. Microsoft should now be able to close the acquisition.

The decision marks a major U-turn from the CMA, the staunchest critic of the takeover, which effectively blocked the deal earlier this year over concerns the acquisition would hamper competition in the nascent cloud gaming market.
Microsoft first proposed to acquire Activision in January 2022, but has since faced regulatory challenges in the U.S., Europe and the U.K.
In July, the CMA said it would consider a restructured acquisition from Microsoft to allay its concerns. Microsoft offered a spate of concessions, which centered around divesting the cloud rights of Activision games to French game publisher Ubisoft Entertainment.

“It will allow Ubisoft to offer Activision’s content under any business model, including through multigame subscription services. It will also help to ensure that cloud gaming providers will be able to use non-Windows operating systems for Activision content, reducing costs and increasing efficiency,” the CMA said.

The UK’s regulatory U-turn

Regulators globally were concerned that the takeover would reduce competition in the gaming market, in particular around cloud gaming. Microsoft could also take key Activision games like Call of Duty and make them exclusive to Xbox and other Microsoft platforms, the officials contended.
Cloud gaming is seen as the next industry frontier, offering subscription services that allow people to stream games just as they would movies or shows on Netflix. It could even remove the need for expensive consoles, with users playing the games on PCs, mobile and TVs instead.

Microsoft logo is seen on a smartphone placed on displayed Activision Blizzard logo in this illustration taken January 18, 2022.
Dado Ruvic | Reuters

Specifically, the U.K. regulator argued when it blocked the takeover in April that allowing the deal to go ahead would give Microsoft a strong position in the nascent cloud gaming market.
Authorities in the European Union were the first major regulator to clear the deal in May, after Microsoft offered concessions to the EU.
At the time, the CMA said it stood by its initial decision to block the transaction because the compromises presented to the EU would allow Microsoft to “set the terms and conditions for this market for the next ten years.”
Meanwhile, in the U.S., the Federal Trade Commission was fighting a legal battle with Microsoft in an effort to get the Activision takeover scrapped. In July, however, a judge blocked the FTC’s attempt to do so, clearing the way for the deal to go ahead in the U.S.
Just hours later, the CMA said it was “ready to consider any proposals from Microsoft to restructure the transaction” and allay the regulator’s concerns.

Microsoft concessions to the UK

In August, Microsoft offered concessions to the CMA in its second attempt to get the deal cleared.
Under the restructured transaction, Microsoft will not acquire cloud rights for existing Activision PC and console games, or for new games released by Activision during the next 15 years. Instead, these rights will be divested to Ubisoft Entertainment before Microsoft’s acquisition of Activision, according to the CMA.
“With the sale of Activision’s cloud streaming rights to Ubisoft, we’ve made sure Microsoft can’t have a stranglehold over this important and rapidly developing market,” Sarah Cardell, CEO of the CMA, said in a statement.
“As cloud gaming grows, this intervention will ensure people get more competitive prices, better services and more choice. We are the only competition agency globally to have delivered this outcome.”
While the U.K. approved the deal, the CMA, which has been growing increasingly aggressive in its actions to scrutinize big mergers, fired a parting shot at Microsoft in which it slammed the tech giant’s negotiation tactics.
“Businesses and their advisors should be in no doubt that the tactics employed by Microsoft are no way to engage with the CMA,” Cardell said.
“Microsoft had the chance to restructure during our initial investigation but instead continued to insist on a package of measures that we told them simply wouldn’t work. Dragging out proceedings in this way only wastes time and money.”

‘Final regulatory hurdle’

The CMA was the last major regulator holding up the Activision takeover.
Microsoft President Brad Smith said on X, formerly known as Twitter, that he is “grateful” for the CMA’s review and decision.
“We have now crossed the final regulatory hurdle to close this acquisition, which we believe will benefit players and the gaming industry worldwide,” Smith said.
Bobby Kotick, CEO of Activision Blizzard, told employees in an email that he is “excited for our next chapter together with Microsoft and the endless possibilities it creates for you and for our players.”
Throughout the regulatory scrutiny, Microsoft had been trying to show regulators and its closest competitors that it will not make games exclusive.
The U.S. tech giant signed a deal in February to bring Xbox games to Nvidia’s cloud gaming service and struck a 10-year deal to bring Call of Duty to Nintendo players on the same day as Xbox, “with full feature and content parity.” Microsoft also signed a deal in July with its biggest rival Sony to bring Call of Duty to the Japanese firm’s PlayStation gaming console. More

Guangzhou-based Ehang on Friday said it received an airworthiness “type certificate” from the Civil Aviation Administration of China for its fully autonomous drone, the EH216-S AAV, that carries two human passengers.
U.S.-listed Ehang claims it’s the first in the world to get such a certificate.
“Next year we should start to expand overseas,” Ehang CEO Huazhi Hu said in an interview, via a CNBC translation of his Mandarin-language remarks.

An EHang all-electric Vertical Takeoff and Landing (eVTOL) two-passenger multicopter aircraft, performs an unmanned display flight at a Korean government event at Yeouido island in Seoul on November 11, 2020.
Ed Jones | Afp | Getty Images

BEIJING — Self-driving air taxis are one step closer to reality in China.
Guangzhou-based Ehang on Friday said it received an airworthiness “type certificate” from the Civil Aviation Administration of China for its fully autonomous drone, the EH216-S AAV, that carries two human passengers. The regulator is the equivalent of the Federal Aviation Administration in the U.S.

U.S.-listed Ehang claims it’s the first in the world to get such a certificate, which allows it to fly passenger-carrying autonomous electric vertical take-off and landing (eVTOL) aircraft in China.
The certificate will also significantly simplify the company’s ability to get similar certificates for commercial operation in the U.S., Europe and Southeast Asia, CEO Huazhi Hu told CNBC in a video conference interview.
“Next year we should start to expand overseas,” he said, noting those regulators still need to establish a process for mutual regulation of the Chinese airworthiness certification. That’s according to a CNBC translation of his Mandarin-language remarks.
Ehang shares have nearly doubled in price this year, before trading was temporarily halted Monday “in anticipation of an upcoming announcement concerning a very significant development regarding its business operations.” Trading was set to resume Friday.
The company has a market capitalization of about $1 billion.

Global regulatory action

The U.S. FAA in July released a plan that provides a path toward allowing similar autonomous flying vehicles, but initially still requires pilots to sit on board.
California-based Joby Aviation, one of the leading industry players in the U.S., announced earlier this month it expanded its flight test program from remote piloting to include a pilot on board — but it didn’t mention any passengers. Joby has a contract with the U.S. Air Force the company claims is worth up to $131 million.
Regulators in China have been paving the way for autonomous flying vehicles to gain certification. In June, China released new rules for unmanned aircraft flight — vehicles without a pilot on board. It is set to take effect Jan. 1, 2024.

Hu said Ehang is still evaluating which city in China the company will launch its first air taxi passenger flight in, and declined to share a specific date. Hu is also Ehang’s founder and chairman of the board of directors.
He noted that China is the fastest-growing and largest market — with the biggest demand — for such flying vehicles.
In the second quarter, Ehang said it set up a joint venture with Shenzhen-listed Xiyu Tourism and delivered five EH216-S units. The venture aims to develop low-altitude tourism with at least 120 Ehang vehicles in the next five years, the company said.
Ehang said it has overseas pre-orders for more than 1,200 units, including from customers such as Japan AirX, Malaysian Aerotree and Indonesia’s Prestige.
Hu said the company would roll out deliveries rather than filling orders all at once given the industry is still in an early stage of development.
Still, he predicts that in about five years, air taxis will be a common sight in many cities.

Safety track record

Friday’s certification news comes as local Chinese governments, including in Beijing, have allowed fully driverless robotaxis on public streets, and in some cases charge fares to the public.
A significant difference between self-driving taxis and self-piloting drones is that while cars on the road must make turns at intersections, a drone flight is between two points in the air, Ehang’s CEO said.
Hu said Ehang started doing autonomous aerial flight testing in 2017. There were some vehicle incidents during the early experimentation period, he said, but no big accidents have occurred during subsequent tens of thousands of flights, including overseas.
“Whenever carrying humans, until now, we have maintained a very good safety track record,” he said. More

China’s trade slumped this year amid lackluster global demand for Chinese good and muted domestic demand.
The world’s second largest economy is set to release trade data for September on Friday.

An aerial view of a container ship leaving the dockyard in Qingdao in east China’s Shandong province.
Future Publishing | Future Publishing | Getty Images

BEIJING — China reported a smaller-than-expected decline in exports in September from a year ago, while imports missed, according to customs data released Friday.
In U.S.-dollar terms, exports fell by 6.2% last month from a year ago. That’s less than the 7.6% drop forecast by analysts in a Reuters poll.

Imports also fell by 6.2% in U.S.-dollar terms in September compared to a year ago — slightly more than the 6% decline expected by the Reuters poll.
China’s exports have fallen on a year-on-year basis every month this year starting in May. The last positive print for imports on a year-on-year basis was in September last year.
China’s trade slumped this year amid lackluster global demand for Chinese good and muted domestic demand.

Bucking the decline in trade with major trading partners were Chinese imports from the European Union, up modestly in September from a year ago, according to CNBC calculations of the official data.
The U.S. is China’s largest trading partner on a single-country basis, while the Association of Southeast Asian Nations has recently surpassed the EU as China’s largest trading partner on a regional basis.

For the first three quarters of the year, China’s exports to the U.S. fell by 16.4%, while imports dropped by 6% during that time.
Russia was the only major country or region in the Chinese customs agency’s report that showed growth in both exports and imports for the first three quarters of the year from a year ago.
By product category, China’s global export of autos remained the fastest growing, up on a unit basis by 64.4% from a year ago for the first three quarters of 2023. That’s slower than the 69% pace for the year recorded as of August.
China’s exports of ships and boats for the year picked up pace from August on a unit basis to a 16.2% year-on-year increase in the third quarter.
The volume of China’s cosmetics imports fell by 14.2% in the first three quarters compared to a year ago. The volume of crude oil imports rose by 14.6% during that time but fell on a U.S. dollar basis.
The pace of crude oil imports on a year-to-date basis in September was little changed from August.

Slowing economic growth

China’s recovery from the pandemic slowed in the last few months, dragged down by a slump in the massive real estate sector.
The International Monetary Fund this week trimmed its 2023 China growth forecast to 5% from 5.2%, while maintaining a global growth forecast of 3% for the year. The world economy grew by 3.5% last year.
China is set to report September retail sales on Oct. 18, along with third-quarter GDP figures.
Amid rising tensions with the U.S. and Europe in the last few years, China has sought to boost its trade with regional partners in Southeast Asia, as well as countries participating in the Belt and Road Initiative. The BRI is a China-led push for developing regional infrastructure such as ports and railways.

As of the end of September, China said it has trains running to 217 cities in 25 European countries.
Cargo transported along those rail lines accounted for 8% of China-EU trade in 2022, up from 1.5% in 2016, Chinese officials said this week.
China also claimed imports and exports with Belt and Road partner countries reached $19.1 trillion between 2013 and 2022 — for an average annual growth in trade of 6.4%.
The third Belt and Road forum is scheduled to be held in Beijing Tuesday and Wednesday. Russian President Vladimir Putin is expected to attend. More