The R&D World Index (RDWI) for the week ending December 29, 2023, closed at 3,146.21 for the 25 companies in the RDWI. The Index was up 0.93% (or 27.01 basis points). Seventeen RDWI members gained value last week from 0.02% (AbbVie) to 4.69% (Intel). Eight RDWI members lost value last week from -0.04% (Stellantis) to -1.87% (Bristol-Myers Squibb).
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The South Korean National Assembly announced last week that it will reduce the national R&D budget for 2024 to $20.4 billion, a reduction of 15% from what was authorized in 2023 and its first R&D budget cut in 33 years. This was less than the 17% cut originally proposed by the government following backlash from scientific and political communities. The cuts followed President Yoon Suk Yeol’s call for a fundamental reassessment of his country’s R&D strategies made during a fiscal strategy meeting in June 2023. The new budget sees an increase in spending for post-completion corporate R&D projects which benefit about 16,000 researchers. Basic research projects also will see an increase as will the budget for nuclear power plant research. However, the budget for the Ministry of Science and ICT will see a 1.6% decrease.
Japan’s industry leaders, including Toyota, Nissan, Honda, Subaru, Panasonic, and seven other companies announced last week they are teaming up to develop advanced automotive software. Earlier in December 2023, twelve companies including automotive, electrical component, and semiconductor makers created the Advanced SoC Research for Automotive group to research and develop high-performance semiconductors for vehicles. This group will pool their talents and industry experience to develop in-vehicle chips by 2028. By 2030, the research group will install SoCs in mass-produced vehicles, which is especially important since each current vehicle has at least 1,000 semiconductors.
RDW Index member Bristol-Myers Squibb (BMS), Princeton, New Jersey, announced last week that it was purchasing RayzeBio, San Diego, for $4.1 billion. RayzeBio develops radiopharmaceutical drugs that use targeted forms of radiation that are delivered directly to cancer cells. Earlier products using this technology struggled commercially, but further research led to another wave of promising therapies that can attach to tumors while limiting damage to surrounding healthy cells. BMS last week said it was purchasing neuroscience drug developer Karuna Therapeutics for $14 billion. RayzeBio’s lead drug, RYZ101 is in late-stage testing for the treatment of gastroenteropancreatic neuroendocrine tumors, the company is evaluating this drug for lung cancer and other cancer types.
RDW Index member AstraZeneca, Cambridge, U.K., last week announced it has agreed to purchase Gracell Biotechnologies, Suzhou, China, for $1.2 billion. The acquisition will help grow AstraZeneca’s pipeline of cell therapies for potential treatment of cancer and autoimmune diseases. The deal is expected to close in Q4 2024. Following closure Gracell will operate as a wholly owned subsidiary of AstraZeneca with operations in China and the U.S.
The Department of Finance Canada and Innovations, Science and Economic Development Canada announced last week in a joint statement that the launch of Canada Innovation Corporation (CIC) initially slated for 2023, will be delayed to 2026-27. That means that CIC might not happen at all if there is a change in government after the next general election in October 2025. The integration of the National Research Council of Canada Industrial Research Assistance Program into the CIC announced in February 2023, is consequently also delayed until 2026-27. The CIC was expected to be a focused, outcome-directed mandate to increase Canadian business expenditures on R&D.
RDW Index member, Apple, Cupertino, California, is expected to experience numerous roadblocks in its effort to expand its iWatch into the all-in-one medical device. Despite the temporary sales suspension in December, technical and legal challenges to the proposed device are likely to continue according to analysts. Along with the patent approval process, Apple might have to see the need to use other people’s established technologies, according to a former director of the U.S. Patent and Trademark Office. Even with that Apple will have to negotiate the Food and Drug Administration (FDA) 510k processes for any of its blood monitoring options. Legal challenges are also likely to occur as they have in the past when Apple was accused of taking health-sensing capabilities created by smaller companies and incorporating them into the iWatch.
China is stealing U.S.-developed AI secrets to power its spying activities, according to a report last week in the Wall Street Journal. Instead of just stealing trade secrets, the Federal Bureau of Investigation (FBI) and other U.S. agencies believe China can use AI to gather and stockpile data on U.S. citizens at a scale never before possible. AI could be an amplifier to support China’s hacking operations according to the FBI. They’re working to improve their already massive hacking operations using U.S. technologies.
Data released last week from the Alliance for Automotive Innovation, Washington, D.C., revealed that car dealers and carmakers say that U.S. car buyers are increasingly reluctant to ditch their gas vehicles for an electric model. Buyers are put off by the high cost of the technology and concerned about their ability to recharge electric vehicles easily. Dealers have offered incentives and price markdowns which correspondingly have reduced the price of used EVs. EV sales have been slower to take off in the U.S. than in any other global region according to the report.
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 2020 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) which invested a cumulative total of nearly 260 billion dollars in R&D in 2019, or approximately 10% of all the R&D spending 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.
