The R&D World Index (RDWI) for the week ending November 5, 2021, closed at 5,696.94 for the 25 companies in the R&D World Index. The Index was up 1.14% (or 64.41 basis points) from the week ending October 29, 2021. The stock of 22 R&D World Index members gained value from 0.40% (Johnson & Johnson) to 11.13% (Pfizer). The stock of three R&D World Index members lost value from -1.03% (Oracle) to -7.31% (Merck & Co.).
Pepsico, Purchase, N.Y., announced last week that it has plans for two new R&D centers, In Dallas and Barcelona, Spain, which will be dedicated to entirely to digital technologies. These research facilities will be focused on critical digital capabilities, such as predictive analytics and ecosystem engagement, according to the company. The Dallas site will concentrate on the company’s North American businesses, while Barcelona will focus on global digital priorities. The goals of these facilities will be to improve access to real-time sales and inventory data, improve product availability for customers and create predictive decision-making tools for Pepsico employees. The specific sites chosen were based on cities with strong talent availability, world-class education systems and fully developed regional infrastructures. Pepsico had an expected R&D spending of $719 million in 2020.
The U.S. Navy’s Naval Surface Warfare Center, Carderock Division, Maryland, announced last week that it plans to issue an R&D contract that will focus on autonomous and unmanned naval vehicles. The contract will focus on unmanned vehicle payload integration, autonomous vehicle control systems, test and evaluation, prototyping, cybersecurity and vehicle modeling and simulation. The contract announcement does not provide details, such as value, timing or the number of companies that the Navy intends to award contracts, more details will be made in 2022.
DuPont de Nemours, Wilmington, Del., announced last week that it plans to reposition the company to capture growth from electric vehicles and high-speed telecommunications networks. It plans to sell much of its materials and mobility businesses and will buy electronics materials manufacturer Rogers Corp., Chandler, Ariz., for $5.2 billion. DuPont’s materials businesses include thermoplastics, such as various types of nylon, many of which DuPont originally invented. These operations represent about $4.2 billion in DuPont’s revenue for 2021. DuPont is the core company of the 2017 merger of DuPont and Dow Chemical, which later split into Dow, DuPont and agricultural supplier Corteva. DuPont was expected to invest $860 million in R&D in 2020.
RDW Index member Novartis, Basel, Switzerland, announced last week that it planned to sell its stake in RDW Index member Roche Holding AG (also headquartered in Basel) for about $20.7 billion. The Novartis stake, which has been held for more than 20 years, represents about a third of Roche’s voting rights, but only 6% of all shares. Roche said they would finance the buyback, while Novartis said the proceeds would be used in line with its capital allocation priorities, which include acquisitions. Roche has recently acquired a series of smaller biopharma companies. Novartis invested $8.9 billion in R&D in 2020, while Roche invested $14.2 in 2020.
The U.S. Environmental Protection Agency (EPA) last week announced that it will propose a broad expansion and strengthening of regulations to limit methane emissions from oil and natural gas production. The EPA said it would propose controlling methane at nearly a million new and existing wells across the U.S. The EPA would require companies to find and fix methane leaks across all their operations, including wells, storage tanks and piping. The EPA would also prohibit the venting and flaring of gas at oil wells, a process used for many decades. The new regulations are expected to reduce methane emissions by about 74% by 2030.
RDW Index member Pfizer, New York, announced last week that its new experimental oral pill for COVID-19 was highly effective (89%) at preventing people at high risk from being hospitalized or dying if the pill was taken within 3 days of being diagnosed with the disease. Pfizer plans to ask the U.S. Food and Drug Administration (FDA) to authorize the drug’s use this month. If approved, Pfizer could deliver doses this year. A similar pill developed by Merck & Co. and Ridgeback Biotherapeutics has been approved by U.K. regulators and is also being evaluated by the FDA. For the Pfizer pill, patients would need to take 30 pills over five days.
Electric vehicle (EV) manufacturer Rivian, Irvine, Calif., is expected to submit for an initial public offering (IPO) within the next week. The company is currently valued at about $57 billion and has invested nearly $2 billion in R&D efforts over the past two years. They filed a Form S-1 with the Securities and Exchange Commission in October. The company has been delivering vehicles for the past two months and has nearly 50,000 preorders on hand. They plan to build another factory in the U.S. (other than its existing Normal, Ill., facility) and another in Europe and continue to heavily invest in R&D over the next two years. RDW Index member Ford Motor Co. has a 12% stake in Rivian.
RDW Index member Volkwagen, Wolfsburg, Germany, announced last week that it plans to build a future EV at the company’s flagship production facility in Wolfsburg. It had previously announced that it would build its Trinity EV at the Wolfsburg factory, but the new announcement adds a second EV to that mix. Trinity is expected to have advanced software and self-driving technologies. The announcement was made to offset VW employee discontent and to assure investors and board members of the company’s positive stance for future production. Volkswagen invested more than $18 billion in R&D in 2020.
Software security firm McAfee, San Jose, Calif., last week was noted as being sold within the next week to a group of private equity firms, Advent International Corp., and Permira, for more than $10 billion. The company was previously owned by RDW Index member Intel, but Intel sold its majority stake in 2017 to the TPG private equity firm.
R&D World’s R&D Index is a weekly stock market summary of the top international companies involved in R&D. The top 25 industrial R&D spenders in 2019 were selected based on the latest listings from Schonfeld & Associates’ June 2020 R&D Ratios & Budgets. These 25 companies include pharmaceutical (10 companies), automotive (6 companies) and ICT (9 companies) who invested a cumulative total of nearly 260 billion dollars in R&D in 2019, or approximately 10% of all the R&D spent in the world by government, industries and academia combined, according to R&D World’s 2021 Global R&D Funding Forecast. The stock prices used in the R&D World Index are tabulated from NASDAQ, NYSE and OTC common stock prices for the companies selected at the close of stock trading business on the Friday preceding the online publication of the R&D World Index.