Shooting Rampage; Apple CEO Willing to Discuss Safety Vs. Privacy; More
Progress Made towards Oil Production Freeze; Eli Lilly Chairman & CEO
Discusses Drug Studies for Cancer & Alzheimer's Treatments - Part 2>
Elizabeth MacDonald, Meghan McCain, Blake Burman, Mike Murphy>
Cohen, Jerry Greenfield>
NAPOLITANO: That's a great question.
MCDOWELL: -- for a company?
NAPOLITANO: The answer is very little.
NAPOLITANO: This comes up FBI background checks when people are looking for a permit to own a handgun. You could be the craziest, looniest person in town, but unless there is some record of that, unless you've been institutionalized, unless your sanity has been challenged in court where there's a record of it, the FBI is not to know about it, and even an ordinary prudent, thorough background check is not going to find that.
NAPOLITANO: A background check does not consistent of knocking on your neighbors' doors.
UNIDENTIFIED MALE: And Judge, to your point, a lot of large corporations are no longer allowing their employees to use Uber. And the reason is that these people are independent third-party contractors, the drivers of the Uber vehicles. So the company feels that they can actually have legal liability if something -- if you get -- if someone -- a passenger is attacked by an Uber driver. So they're going to --
NAPOLITANO: Well, that'd be very interesting. If a company said to its employee you shall use Uber, and that employee were harmed, would his -- would the employer have liability? Probably so.
UNIDENTIFIED MALE: Absolutely. Yes.
NAPOLITANO: Probably so. But listen. The question is duty. To whom does Uber owe a duty? Uber owes a duty to its customers. It does not owe a duty to somebody who's across the street from one of its drivers.
BARTIROMO: Can you use that same argument with Apple?
NAPOLITANO: Well, Apple is entirely different, because Apple is the government attempting to conscript a private entity to work for it. There's simply no authority to justify that.
BARTIROMO: All right, we'll leave it there. Judge, good to see you.
BARTIROMO: Thanks so much, Judge.
BARTIROMO: We're going right now to more Apple, but I know how you feel on Apple.
BARTIROMO: You are on Tim Cook's side.
BARTIROMO: Yes. Apple steadfast in its unwillingness to unlock the iPhone of San Bernardino shooter Saeed Farooq. FOX Business Network's Elizabeth McDonald now on the details there. Liz, good morning to you.
ELIZABETH MACDONALD, STOCKS EDITOR, FOX BUSINESS NETWORK: Good morning, Maria. Good to be with you.
Tim Cook appears to be softening his tone. He's saying yes, he would be for a commission made up of tech experts, privacy advocates and basically people -- members of Congress to look into this public safety versus privacy issue. He's still sticking fast saying that the -- what the FBI wants would set a dangerous precedent. In other words, creating software to access encrypted phone.
Now FBI Director James Comey and the Department of Justice has refuted practically everything Apple has been saying about what the FBI wants. The FBI director say it does not want to break anyone's encryption. It does not want to set loose on the land a master key. He's -- James Comey is saying everybody should take a deep breath and stop saying the world is ending.
Here the facts that Tim Cook is not disputing, basically Apple would keep custody of the software to get into the terrorist's iPhone. The government would never have the custody of that software, and if they -- if Apple wants to destroy that software, it's up to Apple to destroy it. It's also never -- Apple's never disputed the fact that the County Health Department of San Bernardino owns the terrorist's iPhone and has given the FBI and Apple permission to access it.
It is also saying that -- Cook has never disputed that the government was accessing this terrorist's iCloud data and getting at the contents. We know that that iCloud went dark in the middle of October and that the terrorists, it is assumed, to have disabled it in order to cover possible further terrorist plots.
Also Cook has never disputed that Apple was letting the government -- giving the government access to other iPhones in other cases. Back to you, Maria.
BARTIROMO: All right, Liz, thanks so much. Elizabeth MacDonald with the latest there.
Up next, they weren't at Central Perk, but the "Friends" cast were back together at least for one night. The staggering amount of money that they are still making from their wildly popular sitcom. Back in a minute.
BARTIROMO: Welcome back. Oil one of the big stories for markets this morning, moving higher above $30 a barrel right. It's putting a bid under stocks. We're looking at a pretty good rally for the major averages today.
Phil Flynn with the CME Group with what's driving the move in oil.
PHIL FLYNN, SENIOR ANALYST, PRICE FUTURES GROUP: Good morning, Maria. We're seeing a lot of news on oil. Over the weekend, of course, there was more progress towards talk of a production freeze. We heard a comment from Russia, and we heard from comments from Nigeria that they could see the pathway towards a production freeze. In fact, Russia says we could have a deal by March 1st.
The other thing is the big drop in U.S. rate counts. U.S. rate counts fell to the lowest level since 2008, and that's one of the reasons why the International Energy Agency that just came out with a report this morning says that U.S. energy production, shell production, could fall by 600,000 barrels a day this year and an additional 200,000 barrels a day next year.
Now even though that they say that that's going to happen in the short term, they're actually saying in the long term they're expecting that U.S. production will rise to record high of 14.2 million barrels by 2021. But you've got to get through the short term to get through the gullet (ph).
The other thing the International Energy Agency is saying is that they see that this market is going to get in balance probably by 2017. And they're also raising concerns about complacency because of the lack of investment in the energy complex. They're saying that we could see a price spike in a couple years because of a lack of investment. Back to you.
BARTIROMO: All right, Phil, thanks very much. We definitely want to see the balance between supply and demand. I see where you're going with that. Thank you, Phil Flynn.
"Deadpool" beat out the competition once again in the box office over the weekend. Cheryl Casone with the morning's headlines. Cheryl.
CHERYL CASONE, REPORTER FOX BUSINESS REPORTER: Well, Marie, this raunchy comic book film starring Ryan Reynolds snagged another $55 million in its second weekend. Listen.
Colossus: We can't allow this, Deadpool.
Deadpool: I don't have time for your X-Men bull, Colossus. Besides, nobody's getting hurt. That guy was up there before we got here.
CASONE: OK, this movie already grossed $35 million domestically. Deadpool expected to become one of the most successful R-rated movies ever.
OK, Amazon may be gearing up to launch its own private label and not just sell fashion brands, a move that could squeeze other brands and retailers. "Women's Wear Daily" reporting that the e-commerce giant is looking for a head of marketing and senior brand manager among other positions for its fashion private label team.
And finally, this. Five of the six "Friends" star reunited to pay tribute to James Burrows, who directed more than a dozen episodes of the hit series, including the pilot for NBC. Jennifer Aniston saying all of the friends were close from the start.
JENNIFER ANNISTON, ACTRESS: We really just fell in love and adored each other instantly and would hang out at each other's houses and, you know, watch the show together.
CASONE: By the way, you did note Matthew Perry wasn't there. He was in London rehearsing for his upcoming play, but he sent a videotaped message.
Maria, just so you know, it feels like it went off the air yesterday. "Friends" went off the air 12 years ago.
BARTIROMO: Wow. All right, well, it's certainly a great show. Everybody's friends. Thank you so much, Cheryl.
Coming up, the high cost of prescription drugs continues to be a controversial issue. Eli Lilly's Chairman and CEO John Lechleiter will weigh in next.
First though, for all of you out there who hate ironing, the University of Columbia has the solution for you. This ironing robot uses Xbox Connect technology to scan clothes and map out the best way to get rid of those wrinkles. Robots, next.
BARTIROMO: Welcome back. The high cost of drugs in American. This is an issue that keeps coming back. It was thrust into the national spotlight when controversial pharmaceutical CEO Martin Shkreli was forced testified before the United States Congress on charges of drug price gouging. The hearing shedding light on a very critical issue surrounding the pharmaceutical industry.
Eli Lilly Chairman and CEO John Lechleiter is joining me right now to talk about that and what's happening in Eli Lilly. John, as always, a pleasure to see you.
JOHN LECHLEITER, CHAIRMAN AND CEO, ELI LILLY: Nice to be here, Maria. Thank you.
BARTIROMO: Thanks so much for joining us. You're working on important drugs. One of that is the area around Alzheimer's. And I always say that if we were to see a company come out with an Alzheimer's drug, I don't know what they would charge. Because we all know that if we live to 85, one out of two people will get Alzheimer's.
Where are you on the Alzheimer's drug first?
LECHLEITER: Well, this is -- you're talking about antibody Solanezumab. We announced results from two Phase 3 studies in the summer of 2012. Those results were not -- we did not meet our endpoints. But the results are positive enough to encourage us to do an additional study.
That study's underway. We're treating patients for 18 months versus best standard of care. We'll have the data in the fourth quarter of this year.
So the challenge is yes, we have to prove the drug, where really the industry, including Lilly, is really trying to prove the hypothesis. Does removing this amyloid plaque on its precursor slow down the progression of the disease? That's what we're all hopeful that we're able to see, but it's not proven yet.
BARTIROMO: But what I'm getting at really is the fact that you need to see more money investment, time, energy going into the research and development of things like this. Because this is something that affects all of us.
And how do you balance the idea that you need to make investors understand that yes, if you invest in this, if you put money into R&D, you will see a return so that they think that they will be able to see, you know, charge - - a company be able to charge for it? But at the same time, you have to balance -- you're in a business where you have balance. You're in a business where you have to balance the fact that people have to afford this.
BARTIROMO: How do you do it?
LECHLEITER: Well, first of all, I think we have to maintain a long-term time horizon. We've been investing in Alzheimer's for over 25 years.
I asked the other day what's the cumulative investment over that period. Our guys tell me about $3 billion over 25 years. We don't have anything to show for it yet.
We think in the next -- in the next two years alone, Maria, we'll spend another billion. So our investors have to have this long-term point of view.
LECHLEITER: And I believe that for a pharmaceutical company, you know, to make it today, you have to balance off these big, long-term vests in Alzheimer's with other therapeutic areas that hopefully have better defined mechanisms and pathways that you essentially have a little bit less risk bringing new drugs to market.
BARTIROMO: What is the answer to making drug prices affordable?
LECHLEITER: Well, I think first of all, in all the rhetoric -- and there's been a lot around drug prices -- with the presidential campaign underway, we've got to look at the facts. At retail, prescription drugs have been 10 percent of total health care costs since the 1960s. OK?
LECHLEITER: Even with the spike the 2014 -- and that's the figure that's quoted -- 2014 drug prices rose, I think, 14 percent when you look at retail plus non-retail sales.
LECHLEITER: Well, what happened that year? We had a new hepatitis drug introduced. You had patients waiting literally for that drug, which is not a Lilly drug, but which cures over 90 percent of the cases.
So 2014 was an aberration. Just last week, new data came out for 2015 drug price inflation. About six percent --
LECHLEITER: -- a little over six percent, about half of what it was the year before.
The Congressional Budget Office, or I should say CMS, predicts drug prices will continue to really track healthcare inflation out through the middle the next decade.
LECHLEITER: So I think first of all, we've got to look at the facts. Secondly, we've got to say why do consumers experience drug price -- how do they experience drug price inflation.
LECHLEITER: Well, as I say, drugs, 10 percent of total health care spending, but they're 40 percent --
LECHLEITER: -- of what we as consumers pay among our total out-of-pocket for healthcare.
BARTIROMO: Right. I understand all that. But I mean I'm talking about that person with cancer who unfortunately has to get their dosage, and their dosages is costing them $500 a month or more.
LECHLEITER: It's extremely important to the companies in our industry that are research-based like Lilly that we do everything we can to ensure people can access and afford our medicines. At the extreme, we have patient assistance programs that have helped millions of people since the middle of the last decade afford drugs. People who are -- have no insurance or indigent, have other circumstances, we have programs that step in and cover it.
On the other side, in terms of people being covered with insurance, which is the majority of people in this country, we're really arguing that insurance should reflect the value the way insurance covers, with these co- pays and coinsurance, should reflect the value of medicine. I mean if you're pay 20 percent of the -- of the cost of your medicines out of pocket and only 5 percent of the cost of hospitalization, I think we've got it backwards.
BARTIROMO: Yes, that's a good point. All right. Well, the story of Eli Lilly is a lot of products, and you're affecting a lot of different disease.
Let me ask you about oncology, what you're working on there. Where are we on the fight in cancer -- against cancer? And what are you working on specifically in oncology?
LECHLEITER: Well, I think the story in cancer in recent years has been immune-oncology. In other words, can we harness the body's own immune system to turn on cancer cells. Imagine if we could do that.
In so many ways, our immune system protects us from everything else. Can we trick the immune system into attacking cancer cells? This is the cutting edge of oncology.
A couple of companies are further ahead than Lilly, but we've got some really exciting plays in this area. In addition, we're launching new drugs.
We just launched last month a drug called Portrazza. This is for people with squamous cell non-small cell lung cancer. There really hasn't been an advance in terms of increasing survival in that type of tumor for 20 years old.
So a lot is going on in oncology. We're starting to really harness this science and come up with great new medicines.
BARTIROMO: I feel like there are a lot of promises in the pipeline right now as it relates to cancer. Are there more drugs right now in the pipeline than ever before? Or how would you gauge --
LECHLEITER: Across the industry?
LECHLEITER: Yes, I think ontology is the hotspot right now.
LECHLEITER: And one reason is because we have more clues. We have more evidence based on the science about where to go to prevent cancer and stop tumor growth.
BARTIROMO: Before you go, what's your take on Zika -- the Zika virus? How soon -- how long will it take to get some kind of a vaccine on the market do you think?
LECHLEITER: Well, I don't -- we're not in the vaccine business. Obviously, we're following that story very closely. But if it diseases like AIDS and others historically have been any guide, I'm confident that we will come up with a solution, and we will come up with a way of dealing with this healthcare crisis.
BARTIROMO: So the growth at Eli Lilly is where in the next five years?
LECHLEITER: The growth the next five years is from our launch products that are launching or soon to launch. We have two autoimmune drugs under review by the FDA right now, a drug called Ixekizumab for psoriasis, a drug called Baricitinib for rheumatoid arthritis. So the Lilly story for the next five to seven years is going to be a new product launch story.
BARTIROMO: And I know viewers out there want to -- want to make sure you've got success with that. John, good to see you.
LECHLEITER: Good to see you, Maria.
BARTIROMO: Thanks so much for joining us.
LECHLEITER: You bet.
BARTIROMO: John Lechleiter there. CEO at Eli Lilly.
We're watching markets this morning. Futures pointing to a pretty good rally at the opening of trading. The Dow expected to open up a triple- digit move, up 168 points, and that is off of the best level of the day.
Coming up next, FOX contributor Megan McCain joins us for the hour breaking down everything you now need to know for the 2016 campaign.
Then we'll bring you the latest on Apple's privacy fight. We're talking to the former U.S. District Court Judge Stephen Larson. He's representing a group of families suing Apple. Back in a minute.
BARTIROMO: Good Monday morning, everybody. I'm Maria Bartiromo. Welcome back. It is Monday, February 22nd. With me this morning Rosecliff Capital's Mike Murphy, FOX Business Network's Dagen McDowell, New York attorney Joe Tacopina, and FOX News Contributor Meghan McCain. First, though, your top stories at 8 a.m. on the East Coast.
Donald Trump pulling out a huge win in South Carolina over the weekend, as the Republican candidates now focus on tomorrow's Nevada caucus. The field now thinner by one with Jeb suspending his campaign after a lackluster performance in the Palmetto State.
Donald Trump has now set his sights on Senator Marco Rubio. Here is the Republican front-runner explaining why he says Rubio and Cruz may be ineligible for the presidency.
DONALD TRUMP (R), PRESIDENTIAL CANDIDATE: I think the lawyers have to determine it that -- it was a retweet -- not so much with Marco. I'm not really that familiar Marco's circumstance, and I (inaudible) --
UNIDENTIFIED MALE: But then why retweet it?
TRUMP: -- but I think that -- because I'm not sure. I mean let people make their own determination.
BARTIROMO: Hillary Clinton meanwhile squeaking out a win in the Democratic Nevada caucuses over the weekend with South Carolina now this upcoming weekend. A fresh round of Clinton emails were release, revealing the former Secretary of State was not particularly pleased to cut a Hamptons vacation short back in 2011 for a crucial meeting on the future of Libya.
We spoke with Bernie Sanders supporters Ben & Jerry, the famous ice cream makers, last hour about Bernie's controversial tax proposals. We asked them what they thought the nation's top tax rate should be.
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