FirstFT: EU plans medicine stockpile

Brussels seeks to end a Europe-wide medicine shortage by stockpiling drugs and obliging manufacturers to guarantee supplies. The EU will also try to reduce reliance on China and increase domestic production capacity, the European Commission told the Financial Times.

A surge in winter sickness in the northern hemisphere and reduced exports from China have made it difficult for patients to get hold of some basic medicines such as penicillin and paracetamol. Almost all 27 EU member states and the UK have reported shortages.

Under pressure from governments, the commission has said it will intervene to ensure “strategic autonomy” in basic medicines through a “systemic industrial policy”.

It said it would soon propose legislation to “secure access to medicines for all patients in need and to avoid any market disruption of medicines”. The reform would require “stronger obligations for supply, earlier notification of shortages and withdrawals and enhanced transparency of stocks”, the commission said.

The move is the latest in a series of EU measures to reduce reliance on imports after the Covid-19 pandemic disrupted supply chains. These include proposals for emergency export bans on strategically important products, a move the pharmaceutical industry is likely to fiercely resist.

Five more stories in the news

1. US winter flight chaos More than 10,000 flights were cancelled or delayed yesterday after a computer glitch at the US Federal Aviation Administration grounded planes for two hours. The flight chaos, which already saw travellers stranded during the holiday season, is the worst in more than a decade and has strained a country dependent on planes for long-distance trips.

2. Russia demotes ‘General Armageddon’ Russia has replaced Sergei Surovikin after barely three months as head of its Ukraine campaign following battlefield setbacks and failure to turn the war in Moscow’s favour. Surovikin, nicknamed “General Armageddon”, will be replaced by Russia’s highest-ranking military officer, Valery Gerasimov.

3. Brazil deploys security forces in wake of protests Brazil’s government has deployed additional armed forces across the country to prevent expected far-right demonstrations, hours after former president Jair Bolsonaro posted a video that questioned the result of last year’s election. On Tuesday night, the administration of Luiz Inácio Lula da Silva said extremist groups were planning nationwide protests to overthrow the new president.

4. Disney names new chair ahead of boardroom battle The entertainment giant has named Nike veteran Mark Parker as its next chair as it prepares for a proxy fight with activist investor Nelson Peltz. The Trian Partners head plans to force his way on to the board by directly appealing to investors after Disney said yesterday it opposed giving him a seat.

5. BlackRock plans to cut 500 jobs worldwide The world’s biggest asset manager is set to slash about 2.5 per cent of its workforce as the nearly $8tn fund management group grapples with the fallout from last year’s market sell-off. The move follows other financial services companies, including Goldman Sachs, which are already embarking on cost-cutting drives and plans to reduce staff.

The day ahead

Economic data The European Central Bank releases its economic bulletin explaining its policy decision. France publishes its harmonised consumer price index for December and Germany has unemployment claims figures. In the United States, analysts expect consumer price inflation to have moderated to 6.5 per cent in December from 7.1 per cent in November.

EU leader visits Sweden President Ursula von der Leyen leads a European Commission visit to Sweden to discuss the country’s priorities during its bloc presidency, which began this month.

NHS figures The UK’s National Healthcare Service publishes figures for England in November and December, along with quarterly waiting time data for A&E attendances and emergency admissions.

More UK rail strikes Members of the TSSA union at Rail for London Infrastructure, operator of the city’s new Elizabeth Line service, are due to strike.

Corporate earnings Online fashion retailer Asos, chipmaker Taiwan Semiconductor Manufacturing, motoring company Halfords, engineering multinational John Wood, Marks and Spencer, online retailer N Brown, housebuilder Persimmon, Tesco and hospitality business Whitbread report.

What else we’re reading

Are Britain’s striking workers underpaid? An FT analysis of official data shows that the public sector workers driving the UK’s worst wave of strike action in decades are in occupations suffering the sharpest squeeze during a prolonged stagnation in wages. As a result, many workers look set to fall behind their peers in other rich economies.

NHS in state of emergency Every day brings a new dismal statistic about the state of the UK’s National Health Service, writes Jemima Kelly. From soaring numbers of excess deaths to appalling ambulance waiting times, living in a constant state of calamity has made Britons strangely laid back about the service’s breakdown.

EU corruption probe: Spies, cash and luxury hotels Pier Antonio Panzeri has emerged as a central figure in the corruption probe that shocked the Brussels establishment in December. Qatar, prosecutors believe, used Panzeri and his network to improve its image in Brussels ahead of the Fifa World Cup. But the 67-year-old Italian was not new to the game.

Saudi Aramco doubles down on oil Some western energy companies have been preparing for a future less reliant on fossil fuels, but the world’s biggest supplier is betting on being the last oil major standing. State-owned Saudi Aramco, which already produces about 10 per cent of the world’s oil, is boosting production — while claiming it can make the “lowest carbon” barrel of oil in the industry.

What if 2023 is not the reset that investors are pining for? Last month marked the slowest rate of US inflation in almost a year and the pace of consumer price rises falling back for two months in a row. So why are investors not dancing in the streets? Party-poopers, perhaps humbled by a cruel 2022, have nagging doubts about this year, writes Katie Martin.

Thanks to readers who took our poll yesterday. Five per cent of respondents said they have regularly flown on a private jet since the beginning of the Covid-19 pandemic.

Take a break from the news

Part of the fun of LVMH Watch Week, writes HTSI’s Nick Foulkes, is seeing where the first major event of the horological year will take place. This year, Singapore takes a bow, reflecting the rising importance of this geographically compact nation as a market for luxury watches.