Category: Regulations

FDA Takes “Several Months” to Approve Manufacturers’ “Rapid” Test Applications

(p. A1) As rising Covid-19 infections stoked demand for tests across the U.S. in December, California-based LumiQuick Diagnostics Inc. shipped 100,000 rapid tests to a hospital customer—in Germany.

LumiQuick didn’t receive authorization from the Food and Drug Administration to sell Covid-19 tests domestically after waiting several months for a decision.

Some public-health experts said the relatively strict review process is part of a broader failure by U.S. officials and manufacturers to make and distribute enough rapid tests to track the pandemic adequately. Nearly two years into the pandemic, people have struggled to find tests during the holiday season as infections surge again, fueled by the highly infectious Omicron variant.

. . .

(p. A4) “We’ve never gotten the testing situation well instituted in our country,” said Ezekiel Emanuel, co-director of the Healthcare Transformation Institute at the University of Pennsylvania, and a former member of the Biden administration’s disbanded coronavirus advisory board.

. . .

Some U.S. manufacturers said the FDA’s slow review of new rapid tests discouraged them from making products that they weren’t sure they would be able to sell in the U.S. “Without approval we cannot commit,” said Frank Wang, chief executive officer of BioMedomics Inc., a North Carolina manufacturer that applied for authorization in March. The company has sold some tests outside the U.S.

Another test maker, Kaya17 Inc., said it has been waiting on FDA approval for months. “The FDA has to up their game and move faster,” said Sulatha Dwarakanath, the company’s CEO.

For the full story, see:

Austen Hufford and Brianna Abbott. “Slow Test Approvals Blamed for Shortage.” The Wall Street Journal (Friday, Dec. 31, 2021): A1 & A4.

(Note: ellipses added.)

(Note: the online version of the story has the date December 30, 2021, and has the title “Covid-19 Rapid Test Shortages Tied to Slow Federal Action.” The online version says that the title of the print version is “Tests in Short Supply as Approvals Lag.” But my print version (probably the Central Edition) has the title “Slow Test Approvals Blamed for Shortage.”)

Biden Daycare Proposal Would Act Like $27,000 Tax on Many Middle-Class Families

(p. A17) Child care is already a major expense for parents, and President Biden pledges to reduce its cost with his multitrillion-dollar Build Back Better bill. Yet while some of those who receive government subsidies may see reduced costs, millions of other working parents could see their child-care costs double. The new program would act like a $20,000 to $30,000 annual tax on middle-income families.

The bill’s latest draft proposes to reinvent child care with a trifecta of cost-increasing forces. First, it would remove much of the incentive to offer lower-cost care.

. . .

Second, providers would need extra staff to comprehend and comply with all the new statutes, certifications and agency rules.

. . .

Third, the bill imposes “living wage” regulations on staff pay.

. . .

. . ., Build Back Better could increase costs by more than 120%. For a family with an infant and a 4-year old, that would be an additional annual expense of up to $27,000 if they don’t qualify for subsidies. In 2022, when the subsidy is only available to those earning no more than their state’s median income, that would be half of families currently using child care. Even in 2024 when the subsidies would be more generous, more than a quarter of families using such child care would be paying more than double of what they do now.

For the full commentary, see:

Casey Mulligan. “Biden Would Make Daycare Even Pricier.” The Wall Street Journal (Friday, Dec. 10, 2021): A17.

(Note: ellipses added.)

(Note: the online version of the commentary has the date December 9, 2021, and has the title “Biden Would Make Daycare Even More Expensive.”)

Regulators Allow U.S. Carmakers to Offer Consumers the Same Safer Adaptive Driving Beam Headlights Already Allowed in Europe

(p. B5) I am driving in the California hills high above Malibu, in a deep-blue electric Audi E-tron, and I turn onto a pitch-black winding road. Instinctively, I reach to turn on the high beams. But before I have a chance to do so, the low beams automatically rise and spread out like a hand fan, filling the entire roadway with light and projecting it far into the distance.

A few seconds later, the headlights of an approaching vehicle set my headlights in motion; the high beams angle down as the light continually shape-shifts, changing patterns to avoid illuminating the oncoming car.

I had just experienced adaptive driving beam, or A.D.B., headlights, one of the most important advances in vehicle lighting technology in decades. With A.D.B. lighting, a vehicle’s headlights are essentially always on high beam, while cameras and software instruct them to constantly reshape the beam to avoid blinding oncoming drivers or shining in the rearview mirrors of those close ahead.

The bad news is that while widely used in Europe and Asia for over a decade, these smart headlights are illegal in the United States. On my demonstration drive, I was piloting a not-for-sale-here European model of the E-tron equipped with Audi’s futuristic digital matrix headlighting system.

The good news is that after years of unsuccessful attempts to allow the technology, A.D.B. lights will soon be on American cars and trucks, thanks to a section in the recently passed Infrastructure Investment and Jobs Act that mandates their use.

According to the infrastructure act, adaptive beam headlights must be approved for U.S. use within two years.

. . .

The changeover to A.D.B.-capable headlamps could be swift for some drivers who own Audi, BMW or Mercedes models with deactivated units. Once the A.D.B. standard is approved, it’s possible that a simple software upgrade will activate them.

Some owners who could not wait for legalization say they have figured out how to activate their matrix headlights, and at least one aftermarket service dealer in Southern California will turn them on for $900.

For the full commentary, see:

Eric A. Taub. “WHEELS: Coming Soon: The Perfect Glow on the Road.” The New York Times (Friday, January 14, 2022): B5.

(Note: ellipsis added.)

(Note: the online version of the commentary was updated Jan. 18, 2022, and has the title “WHEELS: Smart Headlights Are Finally on Their Way.”)

EU Plans to Color Nuclear and Natural Gas as “Green,” Allowing a “Nuclear Renaissance”

(p. B6) The European Union has drawn up plans to classify some nuclear power and natural gas plants as green investments that can help Europe cut planet-warming emissions, a landmark proposal that, if approved, could set off a resurgence of nuclear energy on the continent in the coming decades.

The European Commission said it had begun consultations with European Union countries on the proposal, which is intended to provide a common set of definitions of what constitutes a “sustainable investment” in Europe. Any final plan can be blocked by a majority of member states or by the European Parliament.

“The Commission considers there is a role for natural gas and nuclear as a means to facilitate the transition towards a predominantly renewable-based future,” the statement, released on Saturday [January 1, 2022] said.

. . .

. . ., the political tide has increasingly turned in favor of nuclear power as a low-carbon solution to mitigate climate change — especially a new generation of smaller, cheaper plants across the globe, said George Borovas, head of nuclear practice at the global law firm Hunton Andrews Kurth.

“There will be a nuclear renaissance,” he said. “It’s not going to be for everyone, but it will be for a number of countries.”

Investment money wouldn’t start flowing right away, noted Ms. Drew of Credit Suisse. Banks will need to update their sustainable investment governance for funds offered to clients, to include nuclear and gas alongside renewable energy sources like wind and solar power.

And small modular nuclear reactor projects, in particular, still need to get off the ground. “It’s early days. You have a few people with business plans looking for funding,” she noted.

But as the industry scales up, so will the investments. A number of companies, from Rolls-Royce to Westinghouse, are working on models that can be put together in factories and assembled on site at the fraction of the cost of traditional behemoth nuclear plants.

For the full story, see:

Liz Alderman and Monika Pronczuk. “Europe Prepares to Classify Nuclear and Natural Gas as Green.” The New York Times (Tuesday, January 4, 2022): B6.

(Note: ellipses, and bracketed date, added.)

(Note: the online version of the story was updated Jan. 4, 2022, and has the title “Europe Plans to Say Nuclear Power and Natural Gas Are Green Investments.”)

Rational Environmentalism Takes Account of Costs of Climate Regulations

Source of graph: online version of WSJ article cited below, based on Nordhaus model.

(p. A19) The U.N. estimates that even if no country does anything to slow global warming, the annual damage by 2100 will be equivalent to a 2.6% cut in global gross domestic product. Given that the U.N. also expects the average person to be 450% as rich in 2100 as today, that figure falls only to 434% if the temperature rises unimpeded. This is a problem, but not the end of the world.

That means we don’t have to panic but instead can decide policy rationally. Economist William Nordhaus won the Nobel Prize in 2018 for his work on effective climate solutions, and the chart nearby shows the outcome of his model to find the optimal climate policy. His crucial point is that the damage global warming inflicts aren’t the only costly part of climate change; climate policies also create significant economic harm. Since we have to pay both costs, his model aims to minimize their sum.

. . .

That model shows that the optimal policy mix would be one that slows the average temperature’s rise so that by 2100 it only reaches 6.3 degrees. That’s the option that minimizes the total damages from climate change and climate policies.

. . .

. . . carbon taxes aren’t the only smart way to ameliorate climate change. There are two other effective solutions.

The first is innovation. If research could drive the cost of one source of clean energy below that of fossil fuels, consumers would switch with no prompting.

. . .

The second is economic growth. Just about every problem, including the dangers of global warming, are easier to deal with when people are more prosperous.

For the full commentary, see:

Bjorn Lomborg. “A Reasonable Alternative to Preaching Climate Doom.” The Wall Street Journal (Thursday, Nov. 11, 2021): A19.

(Note: ellipses added.)

(Note: the online version of the commentary was updated November 10, 2021, and has the title “A Reasonable Alternative to COP26 and Preaching Climate Doom.”)

The survey mentioned above is reported in detail in:

Association, American Psychological. “Stress in America™ 2021: Stress and Decision-Making During the Pandemic.” Washington, D.C., 2021.

Applying Coase Theorem to Refute the Externality Argument Used to Defend Covid-19 Mandates and Lockdowns

(p. A17) The online Merriam-Webster dictionary defines “anti-vaxxer” as “a person who opposes the use of vaccines or regulations mandating vaccination.” Where does that leave us? We both strongly favor vaccination against Covid-19; one of us (Mr. Hooper) has spent years working and consulting for vaccine manufacturers. But we strongly oppose government vaccine mandates. If you’re crazy about Hondas but don’t think the government should force everyone to buy a Honda, are you “anti-Honda”?

. . .

. . ., early in the pandemic the Food and Drug Administration used its coercive power to discourage the development of diagnostic tests for Covid-19. The FDA required private labs wanting to develop tests to submit special paperwork to get approval that it had never required for other diagnostic tests. That, in combination with the CDC’s claims that it had enough testing capacity, meant that testing necessitated the use of a CDC test later determined to be so defective that it found the coronavirus in laboratory-grade water.

With voluntary approaches, we get the benefit of millions of people around the world actively trying to solve problems and make our lives better. We get high-quality vaccines from BioNTech/ Pfizer, Johnson & Johnson and Moderna, instead of the suspect vaccines from the governments of Cuba and Russia. We get good diagnostic tests from Thermo Fisher Scientific instead of the defective CDC one. We get promising therapeutics such as Pfizer’s Paxlovid and Merck’s molnupiravir.

. . .

The supposed trump card of those who favor coercion is externalities: One person’s behavior can put another at risk. But that’s only half the story. The other half is that we choose how much risk we accept. If some customers at a store exhibit risky behavior, then we can vaccinate, wear masks, keep our distance, shop at quieter times, or avoid the store.

Economists understand how one person can impose a cost on another. But it takes two to tango, and it’s generally more efficient if the person who can change his behavior with the lower cost changes how he behaves. In other words, to perform a proper evaluation of policies to deal with externalities, we must consider the responses available to both parties. Many people, including economists, ignore this insight.

For the full commentary, see:

David R. Henderson and Charles L. Hooper. “Coercion Made the Pandemic Worse.” The Wall Street Journal (Tuesday, December 28, 2021): A17.

(Note: ellipses added.)

(Note: the online version of the commentary has the date December 27, 2021, and has the same title as the print version.)

Californians Move to Texas, to Prosper

(p. 5) A Californian will feel right at home in Dallas even before touching the ground. Like the suburbs around Los Angeles, San Diego and across the Bay Area, Dallas and other Texas metros are built on the certainty of cars and infinite sprawl; from the air, as I landed, I could see the familiar landscape of endless blocks of strip malls and single-family houses, all connected by a circulatory system of freeways.

. . .

My guide through the Dallas suburbs was Marie Bailey, a real estate agent who runs Move to Texas From California!, a Facebook group that helps disillusioned Californians find their way to the promised land. Bailey is herself a Californian. She and her family moved in 2017 from El Segundo, a beach city next to Los Angeles International Airport, to Prosper, a landlocked oasis of new housing developments north of Dallas. In El Segundo, the median home list price is $1.3 million; in Prosper, it’s less than half that.

And in Prosper, the houses are palatial, many of them part of sprawling new developments that brim with amenities unheard-of in California. “It’s like living in a country club,” Bailey told me, which sounded like hyperbole until she showed me the five-acre lagoon and white sand beach in the development where she and her husband purchased a home. Their house is 5,000 square feet; they bought it for about the same price for which they sold a home they owned in Orange County, which was 1,500 square feet.

Bailey’s move gets to the heart of the great California-Texas migration: housing. As she drove me around Dallas’s suburbs, Bailey would point out cute house after cute house now occupied by a Californian. I had been talking about the idea of choosing between California and Texas, but for many people moving here, Bailey suggested, there really was not much choice at all — it was simply that, economically, they could not make their lives work in California, and in Texas, they could.

. . .

Texas, now, feels a bit like California did when I first moved here in the late 1980s — a thriving, dynamic place where it doesn’t take a lot to establish a good life. For many people, that’s more than enough.

For the full commentary, see:

Farhad Manjoo, Gus Wezerek and Yaryna Serkez. “Is Texas the New California?” The New York Times, SundayReview Section (Sunday, November 28, 2021): 4-5.

(Note: ellipses added.)

(Note: the online version of the commentary has the date Nov. 23, 2021, and has the title “Everyone’s Moving to Texas. Here’s Why.”)

Most of Supply-Chain Delays Occur in U.S.

(p. A17) Mr. Levy, 53, says he doesn’t see the supply chain’s “unprecedented crisis” ending before 2023. He’s chief economist for Flexport, a San Francisco-based tech company for global-logistic services.

. . .

The typical transit time for a container in pre-pandemic days was 71 days, Mr. Levy says. That’s how long it took for a full container to depart from Shanghai; discharge in Los Angeles; proceed to a warehouse near, say, Chicago; get trucked empty back to California; and then return to Shanghai. The current transit time is 117 days or more. The greatest delays are in the U.S., owing to port bottlenecks and trucking shortages. The Los Angeles to Chicago leg, for instance, now takes 22 days, 12 more than before. It takes 33 days for the empty container to return to California, compared with 20 in the old days.

Not only does it take much longer to import goods, it’s also become eye-wateringly expensive. “Where it might have cost $1,500 to move a container across the Pacific,” Mr. Levy says, “you’re seeing them go for more like $15,000 per container.”

This surge in transport costs has hit lower-value goods hardest and made quick restocking all the more of a challenge. Mr. Levy talked to a company that sells office supplies. “They were moving a container whose contents were in the order of $15,000 in value. Well, if that now costs $15,000 to move, you have a problem, right?”

. . .

The key question: “When will we start seeing people behave the way they used to in their consumption?” It’s possible we won’t. “People are creatures of habit,” Mr. Levy observes, and the pandemic has led them to take on new habits. So far, at any rate, “we have not seen a reversion to the previous patterns.”

The supply-chain crisis, Mr. Levy contends, has no parallel in history. We’ve had shocks before, such as the oil crisis of 1973. But “global-trade liberalization and distributed specialization,” allied to an ease of shipping and transport, fueled by ideas like “just-in-time inventory”—that’s all new.

. . .

There are specific short-term measures that governments can take, such as liberalization of trucking rules, traffic control, land-use regulation for stacking containers and port-opening hours. But Mr. Levy is “loath to put a small subset of these forward as a panacea.”

For the full interview, see:

Tunku Varadarajan. “THE WEEKEND INTERVIEW; An Insider Explains the Supply-Chain Crisis.” The Wall Street Journal (Saturday, Dec. 18, 2021): A17.

(Note: ellipses added.)

(Note: the online version of the interview has the date December 17, 2021, and has the same title as the print version.)

Small Modular Reactors Are Safer and Cheaper Than Older Reactors and Generate More Predictable Carbon-Free Energy Than Can Wind and Sun

(p. B13) Nuclear energy is a rare thing—a carbon-free energy source that isn’t hyped and enjoys bipartisan support in Washington. The big question now is whether new technologies that might lower the costs actually work.

Governments are reconsidering nuclear power, given its ability to provide predictable carbon-free energy.

. . .

“Modular” nuclear fission plants are where the real promise lies. Simpler designs, standardized components and passive safety features all help reduce costs. Being smaller can make it easier to find sites and integrate into a grid with intermittent renewables. Proponents estimate that modular reactors could more than halve the cost and build time associated with traditional ones.

One approach uses existing technologies to build small modular reactors, known as SMRs. They generate anything from a few megawatts to 500, compared with around 1,000 or more for a typical conventional reactor. The controlled fission reaction splits uranium, which heats water into steam, driving a turbine to generate electricity. Water also cools the reactor. SMRs use passive safety features, such as placement underground or in a pool of water, to reduce the need for some more expensive measures. It makes them cheaper to build, but opponents worry it could be a recipe for more disasters.

. . .

Others are trying to build modular reactors with new technology, such as novel nuclear fuels or cooling systems involving gas or salt instead of water. These advanced designs are intended to reduce the risk of accidents and build in more flexibility for intermittent power.

. . .

In 2020, the U.S. Department of Energy’s Advanced Reactor Demonstration Program co-founded two advanced nuclear reactor demonstration plants to be completed by 2027. The first is designed by Bill Gates-backed TerraPower in partnership with GE-Hitachi. It will feature a 345 MW sodium-cooled fast reactor with integrated energy storage on the site of a retiring coal plant in Wyoming. The second will be built in Washington state by X-Energy using four of its 80 MW helium gas-cooled reactors fueled by special uranium pebbles.

. . .

There is also innovation in nuclear fusion—combining atoms to generate energy—which comes with fewer safety and waste concerns. This month, Commonwealth Fusion Systems secured $1.8 billion in funding with promises to build reactors in the 2030s. But many think commercially viable fusion remains a very long shot.

For the full commentary, see:

Rochelle Toplensky. “Nuclear Power’s Second Chance.” The Wall Street Journal (Tuesday, Dec. 21, 2021): B13.

(Note: ellipses added.)

(Note: the online version of the commentary has the date December 20, 2021, and has the title “Nuclear Power Has a Second Chance to Prove Itself.”)

“Endless” Trial-and-Error Experiments Led to Creation of Islet Cells to Cure Type 1 Diabetes

(p. 1) Brian Shelton’s life was ruled by Type 1 diabetes.

. . .

His ex-wife, Cindy Shelton, took him into her home in Elyria, Ohio. “I was afraid to leave him alone all day,” she said.

Early this year, she spotted a call for people with Type 1 diabetes to participate in a clinical trial by Vertex Pharmaceuticals. The company was testing a treatment developed over decades by a scientist who vowed to find a cure after his baby son and then his teenage daughter got the devastating disease.

Mr. Shelton was the first patient. On June 29, [2021] he got an infusion of cells, grown from stem cells but just like the insulin-producing pancreas cells his body lacked.

Now his body automatically controls its insulin and blood sugar levels.

Mr. Shelton, now 64, may be the first person cured of the disease with a new treatment that has experts daring to hope that help may (p. 18) be coming for many of the 1.5 million Americans suffering from Type 1 diabetes.

“It’s a whole new life,” Mr. Shelton said. “It’s like a miracle.”

. . .

One problem was the source of the cells — they came from unused fertilized eggs from a fertility clinic. But in August 2001, President George W. Bush barred using federal money for research with human embryos. Dr. Melton had to sever his stem cell lab from everything else at Harvard. He got private funding from the Howard Hughes Medical Institute, Harvard and philanthropists to set up a completely separate lab with an accountant who kept all its expenses separate, down to the light bulbs.

Over the 20 years it took the lab of 15 or so people to successfully convert stem cells into islet cells, Dr. Melton estimates the project cost about $50 million.

The challenge was to figure out what sequence of chemical messages would turn stem cells into insulin-secreting islet cells. The work involved unraveling normal pancreatic development, figuring out how islets are made in the pancreas and conducting endless experiments to steer embryonic stem cells to becoming islets. It was slow going.

. . .

The next step for Dr. Melton, knowing he’d need more resources to make a drug that could get to market, was starting a company.

. . .

His company Semma was founded in 2014, a mix of Sam and Emma’s names.

One challenge was to figure out how to grow islet cells in large quantities with a method others could repeat. That took five years.

The company, led by Bastiano Sanna, a cell and gene therapy expert, tested its cells in mice and rats, showing they functioned well and cured diabetes in rodents.

At that point, the next step — a clinical trial in patients — needed a large, well financed and experienced company with hundreds of employees. Everything had to be done to the exacting standards of the Food and Drug Administration — thousands of pages of documents prepared, and clinical trials planned.

Chance intervened. In April 2019, at a meeting at Massachusetts General Hospital, Dr. Melton ran into a former colleague, Dr. David Altshuler, who had been a professor of genetics and medicine at Harvard and the deputy director of the Broad Institute. Over lunch, Dr. Altshuler, who had become the chief scientific officer at Vertex Pharmaceuticals, asked Dr. Melton what was new.

Dr. Melton took out a small glass vial with a bright purple pellet at the bottom.

“These are islet cells that we made at Semma,” he told Dr. Altshuler.

Vertex focuses on human diseases whose biology is understood. “I think there might be an opportunity,” Dr. Altshuler told him.

Meetings followed and eight weeks later, Vertex acquired Semma for $950 million. With the acquisition, Dr. Sanna became an executive vice president at Vertex.

. . .

Less than two years after Semma was acquired, the F.D.A. allowed Vertex to begin a clinical trial with Mr. Shelton as its initial patient.

For the full story, see:

Gina Kolata. “A Cure for Severe Diabetes? For an Ohio Patient, It Worked.” The New York Times, First Section (Sunday, November 28, 2021): 1 & 18.

(Note: ellipses, and bracketed year, added.)

(Note: the online version of the story has the date Nov. 27, 2021, and has the title “A Cure for Type 1 Diabetes? For One Man, It Seems to Have Worked.”)

Wisconsin Hospitals Increasingly Sue Patients

(p. A8) Hospitals in Wisconsin have sued patients over medical debt at a rate that amounts to one out of every 1,000 residents a year, especially people in low-income areas and who are Black, a new study found.

The study, published Monday [Dec. 6, 2021] in the health-policy journal Health Affairs, found some hospitals were more likely than others to take patients to court and low-income and Black patients were disproportionately sued.

The findings highlight how the financial and legal jeopardy that patients face depends on which hospital they go to. The findings also add to mounting research on the consequences of medical debt, a problem that research shows is more acute among people who are uninsured.

Medical-bill lawsuits “are not a fait accompli,” said Zack Cooper, an economist with the Yale University School of Public Health and an author of the new lawsuit analysis. “This is very much a choice that these hospitals are making.”

. . .

Hospitals were suing people more for unpaid bills, the study also found. The rate increased to 1.53 lawsuits for every 1,000 residents in 2018, up from 1.12 lawsuits per 1,000 residents in 2001.

. . .

Dr. Cooper called for more data to better understand potential factors driving the disproportionate number of lawsuits among Black patients.

“First, Black patients could have a higher burden of unpaid medical bills, which leads them to get sued more on a per-capita basis,” he said. “Second, Black patients could have a similar amount of debt, but were more likely targeted by hospitals.”

For the full story, see:

Melanie Evans and Tom McGinty. “Hospital Debt-Collection Practices Vary.” The Wall Street Journal (Tuesday, Dec. 07, 2021): A8.

(Note: ellipses, and bracketed date, added.)

(Note: the online version of the story was updated December 6, 2021, and has the title “Hospitals in Wisconsin Pursued Medical Debt Collection Widely but Unevenly, Study Finds.” The online version says that the title of the New York print version is “Hospitals Faulted on Medical-Debt Suits.” The title of my National edition of the print version is “Hospital Debt-Collection Practices Vary.”)

The article co-authored by Cooper, and discussed above, is:

Cooper, Zack, James Han, and Neale Mahoney. “Hospital Lawsuits over Unpaid Bills Increased by 37 Percent in Wisconsin from 2001 to 2018.” Health Affairs 40, no. 12 (Dec. 2021): 1830-35.