Los Angeles Times - 27.08.2019

C2 TUESDAY, AUGUST 27, 2019 WSCE LATIMES.COM/BUSINESS

BUSINESS BEAT

Facebook Inc. is being
probed by Hamburg’s data
protection authority over its
transcribing of audio from
users of its services, adding
to an investigation into
Google’s automatic speech
assistant.
Facebook “is currently
the subject of a separate in-
vestigation” into
transcription of human-to-
machine and human-to-hu-
man communications, the
Hamburg Commissioner for
Data Protection said in a
press release on Monday.
“Manual evaluation was
used in Facebook Messenger
to optimize the transcrip-
tion function.”
Bloomberg reported ear-
lier in August that Facebook
has been transcribing the
audio of users who chose the
option in Facebook’s
Messenger app to have their
voice chats transcribed. The
human review was aimed at
checking whether Face-
book’s artificial intelligence
correctly interpreted the
messages.
In an emailed statement,
the Irish data protection
commissioner’s office, Face-
book’s main privacy watch-
dog in the EU, said that while
the voice-to-text feature was
not offered to users in Eu-
rope, Facebook inadvert-
ently manually transcribed
the audio clips of fewer than
50 European users across 14
countries. The situations
occurred when a U.S.-based
user of the feature engaged
with a Europe-based con-
tact.
The Irish watchdog said
it had notified the relevant
national privacy authorities
of the 14 countries and said
Facebook had pledged to in-
form it before starting
manual transcription of Eu-
ropean users’ audio data. It’s
unclear how many
U.S.-based users were af-
fected.
European privacy au-
thorities have the power to
fine companies as much as
4% of annual turnover for
violating the bloc’s data pro-
tection rules, but such tough
measures are usually

reserved for major breaches.

Facebook is facing

intense regulatory scrutiny

of its businesses in Europe,

including an antitrust probe

into its Libra cryptocur-

rency and numerous privacy

investigations that could

lead to hefty fines.

Facebook declined to

comment. The company

previously said it had

paused human review of the

audio in early August.

Google said in a state-

ment that it has met with the

Hamburg regulator to dis-

cuss the issue.

“We’re currently assess-

ing how we conduct audio re-

views and help our users

understand how data is

used,” Google said. “These

reviews help make voice

recognition systems more

inclusive of different accents

and dialects across

languages.”

The issue of digital as-

sistants and transcription of

user commands has dogged

several major technology

companies. Tech platforms

say the human analysis of

voice chats helps train and

correct mistakes, thereby

improving responses to que-

ries by users. But privacy ad-

vocates worry users’ rights

could be breached if terms of

service about the practice

are unclear or transcription

occurs without their

knowledge.

Hamburg has been

probing Google over the

recordings and the company

has already agreed to pause

the practice for at least three

months. The Alphabet Inc.

unit should warn users

about the risk of accidental

activation of speech record-

ings and seek consent for

transcriptions, the regula-

tor said.

Apple Inc. and

Amazon.com Inc. have also

suspended or announced

changes to human analysis

of user commands, amid

increasing global scrutiny by

regulators and lawmakers

over the privacy

implications of the practice.

The U.S. Congress is

working on a federal privacy

bill that could also tackle the

handling of voice recordings.

More recently, Microsoft

Corp. was found to engage in

the practice, according to

articles by Motherboard,

highlighting the importance

human review still plays in

training machine-learning

algorithms.

White and Drozdiak write

for Bloomberg.

Facebook’s text

transcribing

efforts probed

A German privacy

regulator is reviewing

the social platform’s

use of humans to

handle voice clips.

By Aoife White
and Natalia Drozdiak

Amgen Inc. will pay

$13.4 billion for a blockbuster

psoriasis drug from Celgene

Corp., which is shedding the

asset in order to win an-

titrust regulators’ sign-off

for Celgene’s $74-billion

merger with Bristol-Myers

Squibb Co.

The all-cash deal will give

Amgen a growing product at

a time when the blockbuster

biotechnology drugs it made

its name on are beginning to

fade. For Celgene and Bris-

tol-Myers, the divestiture

will pave the way to one of

the pharmaceutical indus-

try’s largest mergers of the

last decade.

The price is $11.2 billion

once future cash tax benefits

are taken into account,

Thousand Oaks, Calif.-

based Amgen said in a state-

ment Monday. Bristol-My-

ers also expanded a share-

buyback plan to $7 billion,

from $5 billion.

Bristol-Myers has a com-

peting psoriasis drug in de-

velopment, and in June an-

nounced its plan to divest

Summit, N.J.-based Cel-

gene’s drug Otezla. The pso-

riasis medication had sales

last year of $1.61 billion, and

is expected to bring in reve-

nue of $2.71 billion in 2023, ac-

cording to analysts’ esti-

mates compiled by

Bloomberg.

Antitrust authorities

have taken an increasing in-

terest in pharmaceutical

deals, which have in the past

attracted less scrutiny.

Along with the U.S. Fed-

eral Trade Commission’s

scrutiny of the Celgene deal

with Bristol-Myers, the

agency is also looking at

Roche Holding’s planned ac-

quisition of gene therapy

company Spark Therapeu-

tics Inc.

Antitrust divestitures

can present a chance for ac-

quirers to shop for bargains,

since the selling companies

need to shed the asset to

achieve their larger objec-

tives. But Celgene and Bris-

tol-Myers may have bucked

that trend. Earlier this

month, Jefferies analyst

Michael Yee said that an $8-

billion price would be the

benchmark for a cheap

price. And in July, Mizuho

analyst Salim Syed put a $10-

billion high-end price on

Otezla.

The deal is the largest

transaction Amgen has at-

tempted in recent memory.

The company had one of the

largest cash piles in the in-

dustry at the end of 2017,

stoking speculation that it

might use its hoard to buy

smaller biotechnology com-

panies. However, last year

Amgen spent $10 billion to

buy back its own shares

rather than pursue a large

deal.

In an interview Monday,

Chief Financial Officer

David Meline said Amgen

had held off on conducting

mergers because it viewed

potential targets as too ex-

pensive.

“It’s been quite some

time since we’ve done a

transaction as it related to

business development,”

Meline said. “In part, that’s

because prices we’ve seen

have been too high.”

Meline and Murdo Gor-

don, executive vice presi-

dent of commercial opera-

tions, said Otezla fits well

into Amgen’s existing re-

search portfolio. The take-

over won’t impede Amgen’s

ability to pursue other po-

tential takeovers, Meline

said.

The deal is contingent on

Celgene and Bristol-Myers

getting final antitrust ap-

proval. Bristol-Myers had

previously said it expected

the deal to close by the be-

ginning of 2020. On Monday,

Bristol-Myers said it now ex-

pects the deal to close by the

end of this year.

Psoriasis is a disease of

the immune system, and

causes a sometimes-painful

rash when it flares up. An es-

timated 8 million Americans

are affected by psoriasis, ac-

cording to the National Pso-

riasis Foundation.

Otezla is approved for

what’s known as plaque pso-

riasis, the most common

form of the disease, as well as

psoriatic arthritis.

Armstrong and Spalding

write for Bloomberg.

Amgen buys a blockbuster

Company will obtain

psoriasis drug Otezla

from Celgene, which

is merging with

Bristol-Myers Squibb.

By Drew Armstrong

and Rebecca Spalding

AMGEN, based in Thousand Oaks, will pay $13.4 billion for Otezla., which Celgene

is selling to ease antitrust concerns over its merger with Bristol-Myers Squibb.

Al Seib Los Angeles Times

President Trump scoffed

yet again at a source of elec-

tricity championed by his

own Energy secretary, say-

ing wind power doesn’t work

“all that well.”

“We’re the No. 1 energy

producer in the world,”

Trump said at the end of a

summit of the Group of 7 in

Biarritz, France. “I’m not go-

ing to lose that wealth on

dreams, on windmills,

which, frankly are not work-

ing all that well.”

The comment, in re-

sponse to a question about

climate change, is the latest

in a line of statements from

the president disparaging

wind power.

And yet, the U.S. has add-

ed more than 15 gigawatts

since he took office in 2017,

enough to power half of New

York state.

The industry, meanwhile,

now employs more than

110,000 people.

Even Energy Secretary

Rick Perry touts the benefits

of wind, which supplies

about 20% of electricity in

his home state of Texas.

“America’s wind industry

supports more than 100,

American jobs at over 500 fa-

cilities across the country,”

Perry tweeted on Aug. 6.

“Wind energy is an impor-

tant part of America’s all-of-

the-above energy future.”

Trump has said turbines

are “monstrous,” are “killing

all the eagles” and cause

cancer.

His comment Monday

came after the Energy De-

partment released a report

finding employment in the

industry has risen to a

record 114,000 full-time jobs.

It’s also the cheapest new

source of electricity in many

regions of the U.S.

“We think the president is

making a political miscalcu-

lation in his comments on

wind energy,” Tom Kiernan,

chief executive of the Ameri-

can Wind Energy Assn., said

in a statement.

To be clear, wind energy

does have shortcomings.

Earlier this month in Texas,

wholesale power prices

surged 40,000%, in part be-

cause output from wind

farms fell during a heat

wave.

And in the U.K., more

than a million homes lost

power on Aug. 9 after tur-

bines in the North Sea

tripped offline.

In response to Trump’s

wind power comment, the

Sierra Club called him a “cli-

mate denier.”

“He outright ignores the

existence of the climate cri-

sis, his administration is di-

rected by corporate pollut-

ers, he believes windmills

cause cancer [they don’t],

and he can’t even bring him-

self to engage in meaningful

discussions with other world

leaders about how to ad-

dress the most pressing is-

sue of our time,” the group

said.

Administration variable on winds

Trump disparages

windmill power at G-

summit, but Energy

Secretary Rick Perry

has touted its benefits.

bloomberg

Beyond Meat Inc. has an-

other high-profile fast-food

partner — KFC — to help the

faux meat maker tackle a

plant-based substitute for a

different major protein

source: chicken.

KFC, owned by Yum

Brands Inc., will test plant-

based nuggets and boneless

wings at one of its Atlanta

restaurants on Tuesday.

The location will offer com-

plimentary samples to cus-

tomers who purchase other

items.

“Customer feedback

from the Atlanta test will be

considered as KFC evalu-

ates a broader test or poten-

tial national rollout,” KFC

said in a statement.

Beyond Meat is rapidly

appearing on restaurant

menus across the U.S. and

Canada as plant-based

meat substitutes rise in

popularity and chains such

as Dunkin’, Tim Hortons

and Carl’s Jr. seek to draw in

new diners. Competitor Im-

possible Foods Inc. has de-

veloped the Impossible

Whopper with Burger King

and sliders for White Castle.

Until now, Beyond Meat’s

major restaurant partner-

ships have been limited to

burger, sausage and ground-

beef substitutes, although

the company is also working

on bacon. Chicken substi-

tutes are gaining attention

from big companies, howev-

er: Tyson Foods Inc. has de-

veloped vegetarian nuggets

that include egg whites and

Perdue Farms Inc. has mar-

keted its blended chicken

and vegetable nuggets as

plant-based. Conagra

Brands Inc.’s Gardein has

several chicken substitute

products, including crispy

chicken tenders.

Beyond Meat shares rose

5.6% to $155.13 on Monday.

The stock has climbed more

than 500% since its initial

public offering on May 1.

Yum shares, which have

gained about 27% this year,

rose 1.7% to 117. 2 3.

KFC to give Beyond Meat a taste test

Faux chicken trial in

Atlanta precedes a

possible U.S. rollout.

bloomberg

A KFC restaurant in Atlanta will offer free samples

of plant-based nuggets and boneless wings Tuesday.

KFC

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