WSJ What’s News - Republicans Win Full Control of Washington

Episode Date: November 14, 2024

A.M. Edition for Nov. 14. More than a week after Election Day, the GOP clinches the House majority. Plus, Cantor Fitzgerald CEO Howard Lutnick makes a play to be picked as Donald Trump’s Treasury secretary, as some of the president-elect’s advisers signal skepticism about the top contender, investor Scott Bessent. And, Nvidia plans to bring the Jetson Thor computers for powering humanoid robots to market in the first half of 2025. Luke Vargas hosts. Sign up for the WSJ’s free What’s News newsletter.  Learn more about your ad choices. Visit megaphone.fm/adchoices

Red 1. We're coming at you. Is the movie event of the holiday season. Santa Claus has been kidnapped? You're gonna help us find him. You can't trust this guy. He's on the list. He's a naughty lister.

Naughty lister? Dwayne Johnson. We got snowmen! Chris Evans. I might just go back to the car. Let's save Christmas. I'm not gonna say that. Say it.

All right. Let's save Christmas. There it is. Only in theaters Friday. Republicans formally clinched the U.S. House, solidifying their control of Washington come January. Plus, Nvidia preps the launch of a new line of computers as it targets humanoid robot makers

and why pharma reps are taking their pitch for anti-obesity drugs to HR departments. When it comes to large employers, there's surveys out there that suggest about half of them currently cover the drugs. So that leaves a lot uncovered. And for smaller employers, the coverage rate is even lower. It's Thursday, November 14th. I'm Luke Vargas for The Wall Street Journal, and here is the AM edition of What's News, the top headlines and business stories moving your world today. We begin on Capitol Hill, where Republicans have clinched control of the House more than a week after election day. The victory, sealed by a GOP win in Arizona, gives Republicans the 218 seats needed for

a majority and means they'll have full control of Washington next year. Their margin of control in the House is likely to be narrow, however, with a handful of races still uncalled. As President-elect Donald Trump continues to put together his cabinet, we report that billionaire Howard Ludnick, the chief executive of Cantor Fitzgerald, is making a late play for the role of Treasury Secretary. According to a person with knowledge of the conversations, Ludnick, who's working closely with Trump as his transition team co-chair, has gone directly to the President-elect about

being appointed to the crucial role of overseeing his economic agenda. His move comes as Trump advisers are signaling skepticism about investor Scott Besant, who is widely seen as the front-runner for the job. In recent days, Besant has faced criticism over his past work with billionaire investor and philanthropist George Soros. The last-minute jockeying has triggered uncertainty in the president-elect's inner circle about who he'll choose, with people in his orbit calling the competition a toss-up. A spokeswoman for Ludnik declined to comment, while representatives for the Trump transition

and Besant didn't respond to requests for comment. Meanwhile, media executives are wrestling with what the Trump administration could mean for them as a handful of major deals await regulatory approval, including Skydance Media's merger with Paramount Global and the union of satellite broadcasting companies DirecTV and Dish. Journal media reporter Joe Flint told us what a blue sky scenario for the industry might look like. Some in the media industry are anticipating a friendlier approach to business and mergers and acquisitions.

The CEO of Warner Brothers Discovery, David Zaslov, said as much on an earnings call last week as did one of the biggest owners of local TV stations, Nextstar Media Chief Executive Perry Sook. The hope is that FCC regulations that limit the number of TV stations a company can own might be relaxed, and also that the Justice Department and Federal Trade Commission would take a friendlier look at mergers and acquisitions than was the case during the Biden administration. However, Joe said that Trump's disdain for a number of media companies. He's sued Disney's ABC and anchored George Stephanopoulos for defamation, and alleged

Paramount's CBS misled the public with how it edited an interview with Vice President Kamala Harris. Has other execs worried about potential gray skies? Trump has often taken issue with media companies. During his first term, his Justice Department attempted to block AT&T's acquisition of Warner Media. And Trump's issues with CNN were seen as one of the motivators for that. So it remains to be seen whether a Trump administration will be really friendly to mergers and acquisitions for media or a complete wild card that will be very unpredictable.

Disney is set to report earnings before the bell this morning. And from market ripples to policy shifts that hit closer to home, what questions do you have about Trump's campaign promises, how they'll be implemented, and what they could mean for you or your business? To weigh in, send a voice memo to wnpod at wsj.com or leave us a voicemail with your name and location at 212-416-4328, and we just might use it on the show. Chip giant Nvidia is planning to roll out new computers to power humanoid robots within the first half of next year.

Part of what a senior executive said was a bid to stake a claim in the fast-growing robotics sector. Rather than competing directly in robot manufacturing as Tesla is doing, NVIDIA is positioning itself as a tech provider akin to Google's supply of the Android platform to phone manufacturers. And on an earnings call in August, CEO Jensen Huang said the AI capabilities of the company's Omniverse cloud platform were opening doors to new clients. We are now able to work with just about every robotics company now to start thinking about,

start building general robotics. And so you can see that there are just so many different directions that generative AI is going. general robotics. And so you can see that there are just so many different directions that generative AI is going. NVIDIA's VP of Robotics said today that while widespread deployment of humanoid robots is unlikely in 2025, a development push is underway, with China in particular making aggressive strides in robotics to address issues such as labor shortages. And elsewhere in markets, it's been a busy day so far for a number of other companies hoping to profit off of AI and data center expansion.

Foxconn, the world's largest contract electronics maker known for assembling iPhones, reported better than expected Q3 profit as the AI boom drove demand for its servers. The company's cloud and networking business that houses them is its second biggest revenue source after consumer electronics. ASML, meanwhile, confirmed its long-term growth target, betting that AI demand will drive orders for equipment that chipmakers need to make increasingly powerful semiconductors. The company is forecasting sales could surpass $60 billion annually by 2030, and its Amsterdam listed shares are up more than 4 percent.

And German industrial conglomerate Siemens beat market views with higher net profit in its fiscal fourth quarter, with the company benefiting from high demand for electrical infrastructure driven by data centers. Its shares jumped more than 8 percent today. Coming up, to grow the already large market for anti-obesity drugs, farmer reps are hitting the streets, literally, in a bid to nab FaceTime with HR departments. We'll look at the strategy behind their outreach to employers after the break. What do Ontario dairy farmers bring to the table? A million little things. But most of all, the passion and care that goes into producing the local, high-quality

milk we all love and enjoy every day. With 3,200 dairy-firming families across Ontario sharing our love for milk, there's love in every glass. Dairy Firmers of Ontario, from our families to your table, everybody milk. Visit milk.org to learn more. Last week, Novo Nordisk announced a nearly 80% year-on-year increase in sales of its blockbuster weight loss drug Wigovie for the third quarter. And competitor Eli Lilly also reported strong underlying demand for its popular diabetes

and anti-obesity drugs and said it would try to boost that with a new ad campaign. But to drive the next big growth phase for an anti-obesity drug market that some analysts predict could top $100 billion in annual sales, the journals Peter Loftus reports that Eli, Lilly, and Novo are deploying a boots-on-the-ground strategy as part of a push to speak to company HR departments. And Peter joins me now with the very latest. Peter, tell us if you could what you're learning here about this tactic that these pharma companies seem to be pursuing now.

Right. Well, it's an outgrowth of an unusual dynamic for coverage of these drugs. And that is that a lot of private health insurance plans that are sponsored by employers do not cover these drugs. And the reason is employers are finding the costs just such a big burden for them, because the drugs themselves cost over a thousand dollars a month, and the population of employers that could benefit from these drugs is very big. And so that adds up to big impacts on their health care budgets. And so pharmaceutical companies, they've been used to traditional

marketing approaches like sending sales reps to doctors to persuade them to prescribe the drugs and also sending reps to insurance companies to say, could you cover these drugs? But those traditional efforts haven't really been enough to improve coverage of these weight loss drugs. And so the new sort of unconventional approach is that these companies are sending field reps directly to companies and employers, to the HR departments. And they're saying, we'd like to talk to you about the problem of obesity. And here's what our drugs can do. Peter, just quickly, what does the coverage landscape look like right now? Well, when it comes to large employers, there's surveys out there that suggest about half

of them currently cover the drugs. So that leaves a lot uncovered. And for smaller employers, the coverage rate is even lower. Nat. Alright. So a real coverage opportunity, I guess, if you're the drug companies here, seeing those numbers that you just laid out, what is the kind of cost-benefit analysis that these pharma reps are putting to companies? What's the case they're trying to make?

Dr. John Baxter Sure. So the case they're trying to make is that, yes, this might be a big upfront cost. However, they're trying to convince employers that it's an investment that can pay off down the line in the sense that by treating obesity, you may also be warding off other complications like heart disease or sleep apnea or other things that this class of drugs has shown a benefit for. And so by reducing those downstream complications, you would also be reducing downstream costs of treating those complications. Is there any sort of research that's shown how those costs might go down for other treatments?

Well, it's the hope that that will play out. But I think it's early to actually show that that has happened yet. That's something that could happen in the future. And that's sort of the carrot that the pharma companies are dangling before the employers. Nat. Whereas it's pretty clear that if, you know, a small company in particular adds these weight loss drugs to their company policy, we're talking about an immediate increase in costs. Right. And that's the certainty. They know that, you know, in the first couple of years, they're going to see their healthcare budgets

explode, whereas the prospect of seeing that moderate is a little farther off and maybe a little less certain. Nat. So what then is the likelihood that this pays off? It sounds like there are some real challenges here specifically around price. Dr. Keltner Well, I don't think that the pharma companies would be doing this if they didn't think they could make some headway. They do say that there has been progress, that employer coverage has been creeping up, maybe not at a fast rate as they would hope. But also, another factor here is that they have also been making price concessions that could further entice employers to get on board.

But it's going to be an uphill battle. I don't think they think they're going to convince everybody to do on board. But it's going to be an uphill battle. I don't think they think they're going to convince everybody to do it tomorrow. I've been speaking to Wall Street Journal pharmaceutical industry reporter Peter Loftus. Peter, thanks. Thanks for having me. And that's it for What's News for Thursday morning. Today's show was produced by Kate Bulevent and Daniel Bach with supervising producer Christina Rocca. And I'm Luke Vargas for the Wall Street Journal. We will be back tonight with a new show. Until then, thanks for listening.