CVS Caremark sees Obamacare as expansion opportunity

(Reuters) – CVS Caremark Corp is looking at changes in U.S. healthcare as an opportunity to serve more customers, whether they are picking up prescriptions, getting them through the mail, or stopping by an in-house MinuteClinic for a checkup.

The company, formed when drugstore chain CVS bought pharmacy benefits manager Caremark in 2007 in a $ 27 billion all-stock deal, is set to give details on its strategy as it meets with analysts and investors in New York on Thursday. It also plans to discuss its 2013 financial forecasts.

The coming year stands to be a busy one for the healthcare sector as the United States prepares for 30 million people to join the ranks of insured patients under the Affordable Care Act, or Obamacare, starting in 2014. At the same time, the large population of aging baby boomers and rising demand for specialty drugs stand to be opportunities for companies such as CVS.

The industry is already seeing rapid growth in the number of people signing up for Medicare Part D prescription plans.

“You’ve got 10,000 baby boomers becoming eligible for Medicare every day now,” CVS Chief Executive Larry Merlo said, referring to the health insurance plan for seniors. “The change is upon us and it will evolve over the next several years.”

Merlo asserts that CVS can play a bigger role in getting patients with chronic conditions to stick to their drug regimens, which can save billions of dollars.

About half of Americans suffer from one or more chronic diseases and of those who are newly diagnosed with a chronic disease, such as diabetes, almost 50 percent failed to stick with their drug regimen in the first year, Merlo said.

“The lack of medication adherence is costing our healthcare system some $ 300 billion a year in unnecessary costs,” he said.

While CVS prepares for next year, its main competitors have come under pressure.

Drugstore leader Walgreen Co is trying to lure patients back to its stores after reaching a new contract with Express Scripts Holding Co , CVS Caremark’s largest competitor in the pharmacy benefits manager business (PBM).

In November, Express Scripts said that its business would come under pressure in the weak economy, leaving analysts to question that company’s strategy in the wake of its acquisition of another PBM, Medco Health Solutions.

Merlo declined to comment on whether CVS’s strategy would include any acquisitions, though “bolt-on” acquisitions to support its retail or PBM units are always being reviewed.

CVS also runs roughly 650 MinuteClinic health care clinics, which have seen more patients come in. The day after Thanksgiving was the clinics’ busiest day to date, with 19,000 visits on November 23. CVS expects more than 3 million visits to MinuteClinic in 2012.

Eight of the more than 7,400 CVS stores remain closed after being significantly damaged by Hurricane Sandy. Six should reopen by the end of 2012 and the rest may reopen by the end of the first quarter of 2013, Merlo said.

CVS already said that costs associated with the massive storm would reduce its fourth-quarter earnings by as much as 1 cent per share.

Its third-quarter profit came in a penny ahead of analysts’ expectations, with growth in both the pharmacy benefits management business and the drugstore chain.

(Reporting by Jessica Wohl in Chicago; Editing by Leslie Gevirtz)

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Airlines: 2013 profits to rise thanks to cost cuts

GENEVA (AP) — Airlines‘ profits will improve to $ 8.4 billion in 2013, mainly reflecting cost cuts and restructuring measures taken to compensate for stalling economic growth, the global industry‘s trade group forecast Thursday.

For 2012, the industry anticipates net profits of $ 6.7 billion based on strong second and third quarters — particularly for larger carriers with bigger economies of scale — despite high fuel prices and weaker demand.

But the 2013 results would still be below the $ 8.8 billion earned in 2011 and $ 15.8 billion in 2010. The net profit margin, at 1 percent, would also be well below the 7 to 8 percent officials say is needed to recover capital costs.

The International Air Transport Association‘s annual review focused on the impact of annual world economic growth falling below 2 percent and Brent crude oil trading at $ 109.5 a barrel.

“Airlines have adjusted to this difficult environment through improving efficiency and restructuring,” said Tony Tyler, chief executive of the Geneva-based global trade group.

Tyler told reporters in Geneva that airlines’ financial performance hinged partly on their size.

“Economies of scale are helping larger airlines to cope much better with the difficult environment than small and medium-sized carriers which continue to struggle,” he said.

IATA, whose 240 member airlines carry 84 percent of all passengers and cargo, said the industry’s overall revenue in 2013 is expected to rise to $ 659 billion from $ 637 billion this year, while costs will go up to $ 640 billion from $ 623 billion.

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Here’s the Pope’s First Tweet

The long wait is over and we’ve finally got the first words of Twitter wisdom from Pope Benedict XVI. 

Dear friends, I am pleased to get in touch with you through Twitter. Thank you for your generous response. I bless all of you from my heart.

— Benedict XVI (@Pontifex) December 12, 2012

Ok, so not that funny, but it was all spelled right and we got blessed by a pope, so that’s a good start. And the Pope did actually send the message himself. Pope Benedict appeared on Wednesday morning for his regular weekly address in front of throngs of media and worshipers, and personally hit the tweet button himself on his iPad. Vatican officials say that before the end of the day he will be answering three questions that were submitted to the #askpontifex hashtag earlier this month. Here’s the first of those:

How can we celebrate the Year of Faith better in our daily lives?

— Benedict XVI (@Pontifex) December 12, 2012

By speaking with Jesus in prayer, listening to what he tells you in the Gospel and looking for him in those in need

— Benedict XVI (@Pontifex) December 12, 2012

He actually tweeted in Italian first and his other language accounts weren’t far behind. Follow @Pontifex for more 140 character sermons.

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Publisher Bonnier, Flingo partner to make Smart TV Apps

NEW YORK (TheWrap.com) – Bonnier, the publisher of magazines like Savuer and Popular Science, and Flingo, the largest publisher of apps for Smart TVs, have partnered to create a series of apps extending Bonnier’s titles onto Internet-enabled TV sets and set-tops boxes like the Roku.

Together, they will release a new app for each magazine, offering videos, images and archival content for fans. Savuer has a couple of web series, including “The Test Kitchen” which helps home chefs learn how to peel garlic or dice an onion. Those videos, currently on Saveur’s website YouTube channel, will resurface in the apps, which will be distributed for free in app markets thanks to advertising and sponsors.

Though smart TVs remain a small segment of the TV market, Bonnier believes it is an ideal platform for leading media companies to extend their brand.

“This is about going after new technologies and being at the forefront,” Sean Holzman, Bonnier’s Chief Brand Development Officer, told TheWrap. “We don’t look closely at what other publishing companies may be doing. Flingo has a universe of 15 million devices and that should double in 2013.”

The emphasis will be on video since research demonstrates that it remains the top activity, even more than gaming.

Ashwin Navin, CEO of Flingo, said that while many media companies are putting secondary titles on Internet-enabled TVs, Bonnier is using its top titles.

“Major media companies aren’t putting their crown jewels on smart TVs,” Navin told TheWrap. He added that when they measure how long users spend online with certain brands, websites register just a few minutes.

“You see 10 times that in a TV app. People are more captive and less ADD.”

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Outlook remains cloudy for fiscal “cliff” deal

WASHINGTON (Reuters) – More public jousting from both sides in the “fiscal cliff” talks is expected on Wednesday in what has become a daily ritual of mutual “you go first” calls for more specifics in proposals to avert the steep tax hikes and budget cuts set for the end of the year.

On Tuesday the White House and House of Representatives Speaker John Boehner traded offers still couched in broad and familiar terms that neither side found sufficiently detailed.

If the public back and forth between Boehner and President Barack Obama reflects what’s happening behind the scenes, negotiations to avoid the cliff have a long way to go in the short time remaining in 2012.

Obama and Boehner each have proposed cutting deficits by more than $ 4 trillion over the next 10 years as a way of averting the cliff, but they differ on how to get there. Economists have warned that failure to strike a deal could send the economy back into a recession.

On Tuesday Boehner rejected what the White House viewed as a concession, shrinking the proportion of deficit reduction to come from revenue from $ 1.6 trillion over 10 years to $ 1.4 trillion. Boehner has called for $ 800 billion in revenue through tax reform.

There were also reports, unconfirmed by either side, that the White House has repeated a proposal it made in February to consider reductions in corporate tax rates.

That proposition is considered relatively uncontroversial compared to such politically sensitive matters as cutting entitlement programs such as Medicare, the government health insurance program for the elderly.

‘PLAYING TO THE MEDIA’

White House Press Secretary Jay Carney, commenting Tuesday on suggestions of vagueness in Obama’s dealings with Boehner, responded by holding up copies of prior administration budget proposals that include, among other things, corporate tax reductions, and comparing them to the two-page offer that Boehner has sent to the White House.

A senior Republican fiscal hawk, Senator Tom Coburn of Oklahoma, faulted both sides for playing politics.

“There’s no leadership in Washington either at the presidential level or the leadership level in Congress,” Coburn said on CNN Tuesday night. “People are playing to the media rather than playing to the future of the country.”

Kentucky Republican Senator Rand Paul suggested in a Fox News interview late on Tuesday that, to get things moving, the House vote on the stickiest issue, whether to extend expiring tax cuts to all taxpayers except high-earners, as Democrats want, or to everyone, as Boehner wants.

Republicans would simply vote “present” on the Democratic plan, he said, allowing it to pass.

Let the Democrats approve a tax increase on upper-income taxpayers, he said.

But “do it with their votes, not our votes. Republicans vote present in the House. Democrats can pass the tax increase with only Democrat votes and then the Democrats are the parties of high taxes and the Republicans are the party of lower taxes. And I think that’s the way it should be.”

(Editing by Xavier Briand)

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Doing the College Bowl Game Shuffle

In 1997, when the Arizona-based Copper Bowl was rechristened the “Insight.com Bowl”—and billed as “the first bowl game to be sponsored by an electronic commerce Web site”—it touched a nerve. Sports columnists called the tech suffix “ridiculous.” To echo one cantankerous newspaper writer: “What next? A flag game matching sororities, sponsored by AirTouch?”

Be careful what you wish for. More than a decade later, the Peach Bowl and the Citrus Bowl have been replaced by the Chick-fil-A Bowl and the Capital One Bowl (COF), respectively. The Humanitarian Bowl is no more—it’s now the Famous Idaho Potato Bowl. Teams from the Big East and Conference USA conferences duke it out in the Beef ‘O’ Brady’s Bowl, located in St. Petersburg, Fla. Speaking of which, the Gator Bowl, hosted every year in Jacksonville, Fla., is now the Taxslayer.com Gator Bowl. And starting this year, the once controversial Insight Bowl (the “.com” was dropped in 2002 after the bubble burst) will be known as the Buffalo Wild Wings Bowl (BWLD), named after the Minneapolis-based chain of sports bars.

Some fear the bowl market is getting saturated. “I understand the financial considerations of getting those [sponsorship] checks,” says Kevin Adler, president of Engage Marketing. “But I think some of these bowls devalue themselves with the type of brands they associate with.”

Regardless, this year marks the introduction of three newly renamed bowl games to the mix. What they pay for the title sponsorships is just as mutable as the ever-shape-shifting bowl landscape. “The agreements are always changing,” says Doug Shabelman of Burns Entertainment & Sports Marketing. “With the economy, you’re seeing these bowls and marketers getting as creative as possible. The marketer might pay $ 350,000 to be the title sponsor, but they’ll guarantee exposure in other advertising. It’s like a combination of marketing efforts. Everyone is looking to see where they can get added value.”

Here’s a quick rundown of the NCAA’s newest postseason sponsorships, as well as a rough estimate of what they paid for the title rights:

The Russell Athletic Bowl
Estimated title sponsorship value: $ 350,000 to $ 550,000
This summer, the Kentucky-based sports-apparel manufacturer Russell Athletic partnered with Florida Citrus Sports on a deal to be the title sponsor of the Orlando-based game through 2015. The previous title sponsor from 2004 to 2011 was Champs Sports. The agreement makes Russell Brands (no relation to this guy) the sole apparel provider for this game, the nearby Capital One Bowl, and the Fresh From Florida Parade. Last year’s Champs Sports Bowl, between Florida State and Notre Dame, drew 68,305 ticket holders and 6 million viewers on ESPN.

Heart of Dallas Bowl
Estimated title sponsorship value: $ 350,000 to $ 550,000

In 2010, the AT&T Cotton Bowl Classic (T) was relocated from the Cotton Bowl, a stadium in downtown Dallas, to the gleaming Cowboys Stadium in nearby Arlington. Last year, the contest that took place in the actual Cotton Bowl was the TicketCity Bowl. This year, the game will bear the name Heart of Dallas, a new nonprofit group that will direct funding to a local homeless charity. The “presenting sponsor” is PlainsCapital Bank (HTH), “with additional support from MetroPCS (PCS), Dallas Convention and Visitors Bureau, Omni Hotels and Hyatt (H).” The payout to participants is $ 1.1 million. According to an editorial in the Dallas Morning News, locals are pleased—mostly with the name. “Simple and descriptive, the name also carries potentially great meaning,” the editorial board wrote.

Buffalo Wild Wings Bowl
Estimated title sponsorship value: “$ 2 million plus”
This year, Arizona’s Fiesta Bowl, which had operated the Insight Bowl, announced that it had entered into a multi-year deal with the Minnesota-based sports-bar chain after Insight Enterprises (NSIT), based in Tempe, Ariz., didn’t re-up its title sponsorship. The payout to participants in the game is $ 3.35 million. According to filings with the U.S. Securities and Exchange Commission, it’s estimated that Insight paid roughly $ 2 million for the last two bowl games.

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North Korea’s new leader burnishes credentials with rocket

SEOUL/TOKYO (Reuters) – North Korea successfully launched a rocket on Wednesday, boosting the credentials of its new leader and stepping up the threat the isolated and impoverished state poses to its opponents.

The rocket, which North Korea says put a weather satellite into orbit, has been labeled by the United States, South Korea and Japan as a test of technology that could one day deliver a nuclear warhead capable of hitting targets as far as the continental United States.

“The satellite has entered the planned orbit,” a North Korean television news-reader clad in traditional Korean garb triumphantly announced, after which the station played patriotic songs with the lyrics “Chosun (Korea) does what it says”.

The rocket was launched just before 10 a.m. Korea time (9 p.m. ET on Tuesday), according to defense officials in South Korea and Japan, and easily surpassed a failed April launch that flew for less than two minutes.

The North American Aerospace Defense Command (NORAD) said that it “deployed an object that appeared to achieve orbit”, the first time an independent body has verified North Korean claims.

North Korea followed what it said was a similar successful launch in 2009 with a nuclear test that prompted the United Nations Security Council to stiffen sanctions that it originally imposed in 2006 after the North’s first nuclear test.

The state is banned from developing nuclear and missile-related technology under U.N. resolutions, although Kim Jong-un, the youthful head of state who took power a year ago, is believed to have continued the state’s “military first” programs put into place by his deceased father Kim Jong-il.

North Korea lauded Wednesday’s launch as celebrating the prowess of all three Kims to rule since it was founded in 1948.

“At a time when great yearnings and reverence for Kim Jong-il pervade the whole country, its scientists and technicians brilliantly carried out his behests to launch a scientific and technological satellite in 2012, the year marking the 100th birth anniversary of President Kim Il Sung,” its KCNA news agency said.

Washington condemned Wednesday’s launch as a “provocative action” and breach of U.N. rules, while Japan’s U.N. envoy called for a Security Council meeting. However, diplomats say further tough sanctions are unlikely to be agreed at the body as China, the North’s only major ally, will oppose them.

“The international community must work in a concerted fashion to send North Korea a clear message that its violations of United Nations Security Council resolutions have consequences,” the White House said in a statement.

Japan’s likely next prime minister, Shinzo Abe, who is leading in opinion polls ahead of an election on December 16 and who is known as a North Korea hawk, called on the United Nations to adopt a resolution “strongly criticizing” Pyongyang.

BEIJING BLOCK

China had expressed “deep concern” prior to the launch which was announced a day after a top politburo member, representing new Chinese leader Xi Xinping, met Kim Jong-un in Pyongyang.

On Wednesday its tone was measured, regretting the launch but calling for restraint on possible counter-measures, in line with previous policy when it has effectively vetoed tougher sanctions.

“China believes the Security Council’s response should be cautious and moderate, protect the overall peaceful and stable situation on the Korean peninsula, and avoid an escalation of the situation,” Chinese Foreign Ministry spokesman Hong Lei told journalists.

Bruce Klingner, a Korea expert at the Heritage Foundation, told a conference call: “China has been the stumbling block to firmer U.N. action and we’ll have to see if the new leadership is any different than its predecessors.”

A senior adviser to South Korea’s president said last week it was unlikely there would be action from the U.N. and that Seoul would expect its allies to tighten sanctions unilaterally.

Kim Jong-un, believed to be 29 years old, took power when his father died on December 17 last year and experts believe the launch was intended to commemorate the first anniversary of the death.

The April launch was timed for the centennial of the birth of Kim Il Sung, the grandfather of its current ruler.

Wednesday’s success puts the North ahead of the South which has not managed to get a rocket off the ground.

“This is a considerable boost in establishing the rule of Kim Jong-un,” said Cho Min, an expert at the Korea Institute of National Unification.

There have been few indications the secretive and impoverished state, where the United Nations estimates a third of the population is malnourished, has made any advances in opening up economically over the past year.

North Korea remains reliant on minerals exports to China and remittances from tens of thousands of its people working on labor projects overseas.

The 22 million population often needs handouts from defectors who have escaped to South Korea in order to afford basic medicines.

Given the puny size of its economy – per capita income is less than $ 2,000 a year – one of the few ways the North can attract world attention is by emphasizing its military threat.

Pyongyang wants the United States to resume aid and to recognize it diplomatically, although the April launch scuppered a planned food deal.

It is believed to be some years away from developing a functioning nuclear warhead although it may have enough plutonium for around half a dozen nuclear bombs, according to nuclear experts.

The North has also been enriching uranium, which would give it a second path to nuclear weapons as it sits on vast natural uranium reserves.

“A successful launch puts North Korea closer to the capability to deploy a weaponized missile,” said Denny Roy, a senior fellow at the East-West Center in Hawaii.

“But this would still require fitting a weapon to the missile and ensuring a reasonable degree of accuracy. The North Koreans probably do not yet have a nuclear weapon small enough for a missile to carry.”

Pyongyang says that its development is part of a civil nuclear program, but has also boasted of it being a “nuclear weapons power”.

(Additional reporting by Jumin Park and Yoo Choonsik in SEOUL; David Alexander, Matt Spetalnick and Paul Eckert in WASHINGTON; Linda Sieg in TOKYO; Sui-Lee Wee in BEIJING; Rosmarie Francisco in MANILA; Writing by David Chance; Editing by Raju Gopalakrishnan)

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BlackBerry Messenger 7 adds free Wi-Fi voice calling, split-screen multitasking and more

Research in Motion (RIMM) updated its BlackBerry Messenger to version 7 on Monday, adding a new key feature called “BBM Voice” that “will allow customers to make free voice calls to their BBM contacts around the world over a Wi-Fi connection.” BBM 7 also introduces multitasking with split-screen, which allows users to BBM, check email, or use other apps while on a BBM Voice call; new compatibility with Bluetooth headsets and accessories, 16 new emoticons; direct BBM Update Notification that provides in-app alerts when new versions of an app are available and an easier way to synchronize BBM profiles; Groups; and Contacts with BBIDs for simpler backup and restores. BBM 7 is available as a free update for all BlackBerry smartphones running BlackBerry 6 OS or higher. Users on BlackBerry OS 5 will get BBM Voice “early next year.”

“BBM began as a convenient and effective business messaging tool, and today it is an essential part of daily communications for customers around the world,” said T.A. McCann, RIM’s Vice President of BBM and Social Communities. ”Now, with BBM version 7, customers have a new option: they can text and talk with their BBM contacts near and far, for free.”

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Luke Bryan cleans up at ACAs with 9 awards

Luke Bryan didn’t want the American Country Awards to end.

He cleaned up during the fan-voted show, earning nine awards, including artist and album of the year. His smash hit “I Don’t Want This Night To End” was named single and music video of the year.

Miranda Lambert took home the second most guitar trophies with three. Jason Aldean was named touring artist of the year. Carrie Underwood won female artist of the year, and a tearful Lauren Alaina won new artist of the year.

Bryan, Aldean, Keith Urban, Lady Antebellum and Trace Adkins with Lynyrd Skynrd were among the high-energy performances.

The third annual ACAs were held at Mandalay Bay in Las Vegas Monday night.

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Online: http://www.theACAs.com

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Follow http://www.twitter.com/AP_Country for the latest country music news from The Associated Press.

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Novo bets on high-price niche for obesity drug

LONDON (Reuters) – Denmark’s Novo Nordisk is sizing up a high-price niche market for its drug liraglutide as a weight-loss treatment, with the United States the prime opportunity.

The premium-price approach could turn it into a multibillion-dollar-a-year product, the company believes.

Novo is studying the injected drug – already on the market as a treatment for type-2 diabetes under the brand name Victoza – as a therapy for the seriously obese, with pivotal clinical trial results due in the first half of next year.

While some in the industry are sceptical about using so-called GLP-1 diabetes drugs such as liraglutide to fight obesity, Novo’s Chief Science Officer Mads Krogsgaard Thomsen believes the approach can offer cost-effective benefits.

Glucagon-like peptide-1, or GLP-1, drugs work by stimulating insulin release when glucose levels become too high. Their ability to induce weight loss is an added benefit, since type-2 diabetes is linked to obesity.

What is more, the willingness of the U.S. Food and Drug Administration to license new obesity pills from Vivus and Arena Pharmaceuticals last summer shows the door is open to such new medicines, Thomsen said.

“It’s positive. More physicians are now knowledgeable that pharmacotherapy can make a difference and the political establishment in the U.S. now knows that behavior change alone is not enough,” he said in an interview in London.

More than a third of American adults, or some 100 million people, are obese and the figure is rising fast, posing a growing threat to the nation’s health.

Among this population group, liraglutide may help the severely obese, including those with related problems like interrupted breathing during sleep and pre-diabetes, who might otherwise receive stomach surgery.

“We are not going out to treat the 100 million … We see this as solving a problem in a niche of maybe a few million patients,” Thomsen said.

“If you took one million patients and gave them liraglutide at 3.0 milligrams (a day) at the U.S. price that would be a $ 6 billion market.”

When used in diabetes as Victoza, liraglutide is given at daily doses of either 1.2 or 1.8 mg. Novo is betting on a higher dose to produce greater weight-loss in the obese. A key unknown is whether this will produce unacceptable side effects – and Thomsen admits this makes it something of a “joker” in the company’s line-up of new products.

The main adverse effect of Victoza is nausea in some patients, although this is not strong enough in itself to account for the weight loss seen with the drug and Thomsen does not see nausea as a hurdle to regulatory approval.

More worrying, would be any evidence that high-dose liraglutide is linked to pancreatitis.

Given the high safety bar required for a new obesity drug, analysts are currently divided as to whether liraglutide will make it for weight loss – especially given past disappointments with diet drugs such as Sanofi’s Acomplia.

If all goes according to plan, however, Novo aims to file for approval at the end of next year, implying a potential U.S. launch in late 2014 or early 2015 for a product that would add a new string to the bow of the world’s biggest maker of insulin.

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