A Needled Eli Lilly Cuts Prices

Plus: How Rivian won the burn-rate Grand Prix. ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌

March 2, 2023

Read in Browser

TOGETHER WITH

Good morning.

Your tweens can’t take their eyes off the latest Bella Poarch lip sync video? Don’t worry, TikTok is here to help. On Wednesday, the social media supergiant announced new parental controls to establish a 60-minute screen-time limit for underage users.

Of course, we’re sure the tech-savvy youths of today will find a way to circumvent the restrictions to regain access to the sweet, steady drip of addictive short-form content. Heck, they’ll probably learn how on TikTok.

Morning Brief

•

Eli Lilly jumps on its white horse.

•

Salesforce numbers resist barbarians at its gate.

•

Rivian still can’t quite get on track.

Pharmaceuticals

Eli Lilly Slashes Price of Insulin

(Photo Credit: Melissa Johnson/Flickr)

It’s not a prank this time.

Eli Lilly announced Wednesday it’s cutting the price of its most-prescribed insulin drugs by 70% and introducing a price cap of $35 per month. This comes with the US in the throes of an insulin crisis and four months after a blue-check Twitter account masquerading as the company’s official account declared insulin was now free.

A Spoonful of Political Pressure…

In April 2022, Human Rights Watch published a report on the unaffordability of the drug, citing a lack of government regulation. Per HRW, insulin in the US was over eight times more expensive on average compared to a study of 32 other countries. A single vial can cost upwards of $300, meaning a monthly cost of $1,000.

Eli Lilly’s press statement said it’s slashing prices to make insulin more accessible, and then flipped the onus onto other entities. “We are calling on policymakers, employers and others to join us in making insulin more affordable,” CEO David Ricks said in a statement — casually omitting the fact insulin makers have been under pressure from lawmakers to lower prices:

•

The Inflation Reduction Act introduced a $35 out-of-pocket monthly cap for people on Medicare, but the vast majority of Americans are on private healthcare.

•

In April, the House of Representatives passed a bill that would implement the same cap for privately insured patients, but it was blocked by Senate Republicans in August. There has been some bipartisan collaboration since then to get the bill off the ground, but it’s been an uphill battle.

While Eli Lilly is happy to take the stance of moral superiority on insulin prices, it’s still not averse to playing hardball with rivals in the spirit of capitalism. The company announced it will be launching a new drug called Rezvoglar, which it said will be interchangeable with Lantus, made by rival pharmaceutical giant Sanofi. It said Rezvolgar will cost 75% less than Lantus. Shots fired.

Who Watches The Middlemen: With Eli Lilly taking the high road out of a political hot zone, lawmakers are now turning their gaze to healthcare companies a few steps down the supply chain. A House Committee announced a new investigation into pharmacy benefit management companies (PBMs), firms that are supposed to handle rebates for insurers and employers. The investigation follows an inter-industry blame game in which pharmaceutical companies claim PBMs inflate costs through their role as middlemen, while PBMs blame manufacturers for gaming the patent system to side-step competition, per The Wall Street Journal. A nice, friendly congressional probe should help the two sides clear the air.

– Isobel Asher Hamilton

FinTech

Good Earnings for Salesforce Might Give Activist Investors a Chill Pill

That sound you hear is Marc Benioff exhaling.

After yesterday’s earnings report, which easily beat Wall Street’s estimates, the Salesforce CEO is likely feeling a little less pressure from activist investors who have been circling him and the CRM company like a shiver of great white sharks.

What Can I Say Except You’re Welcome

“Ohana” means family, but Salesforce employees believe Benioff — who uses the Hawaiian word as a company mantra — has forgotten that. Like most tech firms during the pandemic, the Slack parent company went through an overhiring phase that quickly crumbled under its own weight. Last month, Benioff announced they were cutting 10% of the company’s workforce, roughly 8,000 people. Plus, it’s been scaling back on employee perks like in-house baristas and access to its 75-acre wellness retreat known as Trailblazer Ranch.

And in a shockingly not “Alright, Alright, Alright” revelation, The Wall Street Journal reported that Benioff’s buddy and Failure to Launch star Matthew McConaughey was still on the company payroll at $10 million a year to star in commercials where he rhymes about workplace synergy and innovation. This is all on top of the fact that Salesforce’s stock price has dropped nearly 50% since its November 2021 peak of $307 per share.

And now, shareholders are out for blood, trying to turn the outrigger canoe around:

•

Activist investors like Elliott Management, Starboard Value, Third Point, Inclusive Capital, and ValueAct are looking for Benioff to cut costs and boost profits. Elliott has even started nominating a new slate of board directors for Salesforce with one candidate likely being Jesse Cohn, an Elliott managing partner, CNBC reported.

•

Strive Asset Management, known for its “anti-wokeness” investing strategies and run by presidential candidate Vivek Ramaswamy recently sent a letter to Benioff saying Salesforce should not be “using its corporate bullhorn to wade into the divisive social issues de jour,” the WSJ reported.

Good Earnings: Salesforce’s revenue was up 18% year-over-year, totaling $31.4 billion, and it’s expected to grow to $34.5 billion next year. It closed the year with cash flow reaching $7.1 billion, which Benioff said was the highest in the company’s history. So whatever discussion he needs to have with the likes of Elliott and Strive, it will probably go a lot smoother now that he comes bearing gifts — and a Hawaiian lei.

–Griffin Kelly

Sponsored by Outreach

Meet the Sales Execution Platform

Every sales team has two core jobs: create pipeline and close deals.

But in a turbulent market, pipeline coverage is thinner, sales rep participation is lower, and surprise forecast misses become too common.

To succeed in this new era of sales, you need a platform that unlocks seller productivity to efficiently create and predictably close.

That’s why Outreach created the Sales Execution Platform.

Sales leaders trust Outreach when they need to increase win rates and deal velocity, deliver more revenue per seller and improve forecast accuracy.

Compared to expensive point solutions that don’t give you the full picture, Outreach brings together all of the workflows sellers need to create and close in a single platform.

Companies that use Outreach capture 9% more revenue for a fraction of the cost of their previous sales tech stack. This is consolidation without compromise: less risk, less cost, more pipeline, and more wins.

The Outreach Sales Execution platform: Designed to help your entire sales team efficiently create more pipeline and close more deals.

EVs

Rivian is Burning Through Cash, But Its Customers Love Their Cars

Do you want the good news or the bad news first?

The good news for EV startup Rivian is that customers love their cars. In fact, they’re so beloved that Rivian topped an industry-leading customer satisfaction survey. The bad news? Rivian remains, well, a profit hole of quite possibly historic proportions.

Spinning Their Tires

Like many a disruptor, Rivian happily burned money to crash a crowded EV market. And it had the cash to do so: its IPO at the peak of November 2021’s every-growth-business-is-a-good-business mass delusion marked the largest ever for a US company since a college dropout named Zuckerberg took his little social media venture public.

That gave Rivian $13.5 billion in net funds to supercharge production, only for it to become ensnared in 2022’s traffic jam of wild inflation and global supply chain breakdown. After literally halving production goals last year, Rivian now finds itself as the Peloton of EVs — its customers love it, but its shareholders…. less so:

•

In a survey of over 7,000 owners of 2022 and 2023 model-year EVs conducted by car-review company J.D. Power, Rivian’s R1T pickup earned the top grade — receiving high marks across categories such as battery range, battery accuracy, driving enjoyment, and aesthetics.

•

That’s all well and good, but Rivian may also hold a different, not-so-appealing honor: fastest burn rate by a tech company ever (credit to The Wall Street Journal for first recognizing the distinction). According to its earnings call on Tuesday, Rivian ended last year with a negative cash flow of $6.4 billion — well ahead of Uber’s infamous $4.8 billion loss in 2019.

Sorry, Elon: Tesla (which blew through $4.1 billion in 2017 while ripping toward becoming the world’s top EV seller) is now at an all-time low for consumer satisfaction. After topping J.D. Power’s survey the past two years, Tesla found its Model 3 ranked fourth this year behind Rivian, the Mini Cooper Electric, and the Kia EV6. Fortunately for all of us, Musk was too busy fixing Twitter to tweet through the loss.

– Brian Boyle

Extra Upside

•

Get ready for tequila in a can and more, vodka seltzer maker High Noon says.

•

Madison Square Garden Entertainment is launching a streaming service just for Knicks and Rangers games.

•

The Intersection of Wall Street and DC, where money collides with power — it’s where elections are decided, corporate dynasties are born (or die), and the decisions that shape the future of our country are made. Meet Power Corridor, a new newsletter brought to you by The Daily Upside. Written by Leah McGrath Goodman, an investigative journalist with a long track record of disruptive journalism, Power Corridor is your key to understanding the people and forces shaping our world. For no holds barred coverage of the stories that matter, join Leah here.

Just For Fun

Cup snake.

With two hands.

ADVERTISE // CAREERS

No longer want to receive these emails? Unsubscribe here.

//campaignmonitornewsletter.everestengagement.com/ea/BntD2QJCyg/?e=postie@btcnews.com.au’ width=’1′ height=’1′ style=”margin-top:0 !important;margin-bottom:0 !important;margin-right:0 !important;margin-left:0 !important;padding-top:0 !important;padding-bottom:0 !important;padding-right:0 !important;padding-left:0 !important;border-width:0 !important;height:1px !important;width:1px !important;-ms-interpolation-mode:bicubic;” />