let's go to the white house on that note. and president trump. >> american innovation, and the fourth is high out of pocket costs, especially for our seniors. as you heard today, the administration made a lot of progress in this regard, so in the first year and a half in office, the fda approved more generic drugs than ever before in history, saving $8.8 billion in the first year. we also changed medicare's reimbursement rules to bring down the out of pocket spending for senior citizens, saving them $320 million out of pocket on the drugs that they buy each year that work and work laid out now in the president's blueprint has four strategies to fix the complex problem we face. first, increase competition. second, increase better negotiations third, incentives to actually lower list prices. fourth, lowering out of pocket

costs. so, first, it's crucial that we have more competition in the prescription drug markets. that means we need a vital and vibrant generic drug industry and market we need to foster and nurture a new competitive bio similar drug market, generics essentially for complex expensive bilogic medicines. we have to foster and nurture that we also have to get after pharma companies to engage in anticompetitive practices blocking entry of generics or biosimilar products to market by, for instance, blocking access to their products so they can't do the studies they need to do in order to get approval of an affordable generic or biosimilar market, so we're going to go after all of these kinds of abuses. second, we've got to bring more private sector negotiation and better tools to our medicare programs so we get the best deals. the part d drug discount program

for senior citizens is now 15 years old. i was there when we created it and helped to launch it, and when we did it, it was -- it's still a great program, but it had the best tools, best at negotiates great deals for our senior citizens and really able to drive formulas that were efficient keeping the cost down below forecast and constantly low premiums throughout its time, but over 15 years as so often happens with government programs, it got frozen in place. the private sector kept adapting and learning, especially after the economic crisis in 2007, how to control drug spend even better okay part d stayed more static. we need now to bring the same tools that are available to the private sector to those part d drug plans so they can negotiate better we need to unleash them so they drive great deals for seniors. there's another part of the

program, major part, called part b. these are the drugs they administer mention those in the rose garden they are paid on a list price plus a mark up send us a bill, we write a check. no negotiation involved in that at all, and the president proposed in the budget, and we are reemphasizing we have to efficiently out ways to move those drugs, especially the high cost ones into the private part d drug plan negotiations so that we can get a deal and start g getting bargains on that for the seniors and taxpayers. we have to look at other mechanisms, and you see that in the blueprint, some other ones, that helped us negotiate better deals there for those plans. third, and this is a very complex area, right now, we have to bring incentives to lower list drug prices okay right now, every incentive in this system is to increase and have high list drug prices because everybody in the system

except the patient and taxpayer is wetting their beak along the way. they are getting a percent of that list price. list price goes up list price higher. everybody makes more money along i way, so it's just the math works that way we need to try to flip the incentives backwards so financially it makes less sense to increase prices one of the things we're going to do, i talked about this in the rose garden, is that we are going to have the fda look at how we can require direct to consumer tv ads, disclose the list price of the drug we believe it's an important part of fair balance that if you are telling a patient activating a party, having a discuss about a drug with their doctor, telling them the good things the drug can do for them, it's material and relevant to know if it's a $50,000 drug or $100 drug often, that patient has to bare

a lot of the cost. in addition, we have in medicaid and medicare key incentives to turn around on list prices in obamacare, one of the deals with the pharma industry was capping the statutory rebates on drugs in the medicaid program at 100% we are going to work with congress to look at overturning that cap on rebates. that, again, will make the math work so that when you increase your list price, it's going to cost you more money if you are a pharma executive thinking of raising prices we are proposing and thinking about creative ideas in our programs of reversing those incentives right now in the drug discount program, if you have a drug that fits into one of these protected classes, it's almost impossible for the drug plan to negotiate and get any kind of discount from ya, okay? well, that's -- everybody gets that what if instead we say, you only get to be in the protected class if you have not raised the list

price in the previous 18 months. what if we say you can be exempt from the specialty tiers where the patient pays a lot out of pocket, but only if you have not increased list price in the previous 18 months, so a lot of tools like that. the other big area we have to look at is the entire system of rae rae rebates we have. we are calling into question today the entire structure of using rebates as the method of negotiating discounts in the pharmacy channel because right now every incentive is for the drug company to have a high list price and to negotiate rebates down in a nontransparent way what if we said no rebates, flat price, fixed price in the contract, take away this whole what's called the gross to net spread that removes, then, makes people indifferent to what the list price is in that system,

and takes away incentives where even the pharmacy benefit manager makes money from higher list prices. we also have a real issue we have to look at, which is the role of compensation for pharmacy benefit managers. they are taking it now from both sides. they are getting compensated by the customers, insurance companies, but getting compensated by the drug companies they are supposed to be negotiating against they are getting rebates and keeping some of the rebates. they are getting administrative fees should we move to a fiduciary model where the pharmacy benefit manager works for the insurance company or the individual and only is compensated by the insurance company or individual. remove enumeration from the pharmaceutical company so it's completely on one side, complete alignment of interest, and, finally, how do we lower out of pocket drug costs? well, as the president talked about it, we'll get rid of these gag rules.

right now, some pharmacy benefit managers tell pharmacists you're not allowed to tell the patient if they paid cash for the generic drug, it's cheaper for you than if you run it through your insurance that's unconscionable. we're working to block that. it's a right when you are there with your doctor, you ought to be able to know what your out of pocket is for a drug you're going to be prescribed under your precise drug plan and ought to have that information, and you ought to have information on what competing drugs are that your doctor's not prescribing and what you pay out of pocket for that, and that ought to be across the part b plan and part d plan for example, you're in with a democrat doctor this doctor has infusion clinic in the office. they write you a drug that's infused drug there's a $300 co-pay for that want don't you want to know if the doctor wrote you a self-injectable drug it's a $20

copay and have an informed discussion in we think that informed consumer on out of pocket will also help drive real savings in the system. these are some of the measures there's over 50 actions in the blueprint. this is, again, not one and done, okay we are learning. we are open. we are hearing we want this to be active ongoing process. this will not be solved tomorrow it will take years of restructuring the system, but these are big, bold steps, most comprehensive attack on prescription drug affordable in history by any president, and i'm grateful president trump is standing behind us and encouraging us to do these bold measures, so with that said, i have to open it up to questions. >> there's a tremendous number of moving parts in this blueprint, many of which require legislative action, how much of this works without the rest -- have to do it all or part of it, and how much is done through

executive action >> great question. >> most of this, we believe, is done by executive action now, we are more than happy to work with congress on a bipartisan basis so many of the solutions ought to be attracting bipartisan support. we acknowledge they are problems we have to deal with, but we believe most of these actions are steps that we can take using our regulatory authority, especially with the power in the medicare program they are -- few are interdependent, and so it's not as if any one is requiring the proceeding act there we think we attack many of the steps. it is complex, though, because the system is rocket science and unbelievably complex it's a very sophisticated approach hitting at so many of the financial and business levers behind the system, instead of throwing just sort of political speak at this as is easy to do, it's a very business mind set focus on how do you

change the financial levers here to solve the problems. that's what the president wants to do, solve the problem that lead to results. >> secretary, thank you. how soon will consumers actually see this >> so, already, they are seeing lower drug prices from that historic level of generic drug aprov approval last year, almost $9 billion a year on the market the cuts we made to reimburse on medicare drugs, $320 billion from that a year already as we make more -- we are certainly moving forward with any of the changes to make sure that they going to see in the pocketbook right away, you know, so it's -- it's going to take time some takes regulatory action we go through the administrative process, but i can tell you, as soon as i walked out of the rose garden, you know the first question the president and chief of staff had was, when is the execution? i want the execution frame work, meeting next week on time lylin

and getting it done. >> matter of weeks or months >> months for the actions we need to take here. again, this is -- it took decades to erect this very complex interwoven system, talking entrenched market players, complex financial arrangements would have to be redesigned, so i don't want to overpromise that somehow on monday there's a radical change, but there's a deep structural change to the system >> how is this a factor -- announce at the same time next month a yoga international day announced by u.k. and india. maybe you don't need drugs if you have yoga.

>> i stick with the first one, generic drugs. generic drugs, competition in the system is absolutely vital that's why a deep commitment of the administration to remove anticompetitive barriers to competition. yes. >> you talked about calling into question the entire rebate structure. >> yes >> specifically what stance are you dealing with now and when might consumers see progress on that >> as part of the blueprint, there's a request for information, the initiation of seeking input. this is the restructuring -- the possible restructuring of a major sector of the economy. one does not do that lightly it's beginning a national dialogue with the public, with stake holders, with congress on if we were to do this, if we were to outlaw rebates saying in the part d drug discount program and instead require that the product be discounted at a fixed price, so, for instance, just to explain how this works now, let's say you have $1,000 drug

you go to the pharmacy benefit manager saying, hey, if you cover my drug, i'll give you 30% rebate on that after the fact if your patients used this, okay? a $300 rebate on that. what this would say is, instead of that, you would have to negotiate and the contract would say, you get reimbursed $700 this year, and then maybe $702 next year for some inflation, and so fixed, and indifferent than to list price, so this game, what goes on now is, frankly, a bit of a game, which is the drug company negotiates the 30% rebate, and then the next day, increases price 30%, and it's this game of chase that goes on. instead, fixed price, make everything indifferent to the list price, and all the fees not be based on a percent of this artificial list price, which, for so many people, is the rack rate on the back of the hotel room door, nobody pays it, but

too many people in the health care system are now paying for it and suffering from that >> a timeline? >> so this is out today. we're just going to seek comment, learn, and we're going to move forward on that if it makes sense, and we have to learn how to restructure things. i believe even one pharmacy benefit manager just yesterday talked about this precise issue of restructuring their contract to get out of this rebates spread problem that the world is in so i believe it's doable and will have tremendous systemic impact yes? >> notorious example over the last couple years, drug companies buying drugs on the market for years and raising prices extraordinarily >> yes >> anything in the blueprint to address that >> there is. >> like the epi-pen situation. >> there is. one of the elements of increasing power of negotiation we're doing in the plan is if a sole source generic drug, which is what these instances that have got so much attention in the past several years, one

generic drug out there, and if there's increase in price by a generic, we're going to allow the drug plan to reopen their drug formulary immediately and take action against that drug, whereas right now, they have to wait for the end of the year in the new plan cycle and immediately go after the drug, come up with alternative drugs or create preferential treatment over those drugs right away if there's any increase of price of a sole source generic. yes. >> yes, so you're talking about the increases in drug prices, well, in areas like maryland and virginia, insurers are talking about double digit health insurance premiums increases there's a maryland regulator that said something like there's a dust spiral flying towards the president. what are you doing to deal with that as prediction, reality, what are you doing to reduce costs? >> so, some of the premiums right now is the beginning of the process that happens with

state regulators around those insurance designs. these price increases were happening under president obama. they continue because of the structural infirmities in how obamacare was designed this is why the president has been so adamant about producing alternative affordable options for patients because for so many -- 28 million forgotten men and women in this country have been forced out into the individual market sitting there without insurance even though they were promised they'd have successful insurance they could keep you know, 6.7 million americans paid 3.1 billion dollars in the obamacare taxes for the privilege of not buying insurance they couldn't afford and didn't want, and 80% of them make $50,000 or less we are trying to bring short term plans for an option for people, the labor department is options for people the president is we want to keep looking for more options to get people out of some of the trap

that the obamacare system has created of the high cost and uncompetitive plans for people yes. >> question with an issue on anti-competition the department is set to change an obamacare rule barring those denying medical treatment to gender reassignment, will hhs review the rule? >> i'm not familiar with the particular issue i'll look into that when i get to the department, thank you i'm familiar with drug prices. >> so you talked about medicare part d negotiating better prices, does that do the same thing the president talk about when other countries socialize medicare, they are ripping us off, why is that okay for medicare, but not for other countries? >> oh, so the difference is, the difference is having entities negotiate in a competitive

environment, so what happens in some of the socialist countries i dealt with in the past, what they do is they say, you don't come into this country unless you pay this low pricing and here's a low below market noncompetitive price you either pay it, or you don't come into this country, and they don't really care if the people of their country don't get access to the drug, and people are not informed even that they don't have access to that medicine in these rationed systems, and so that's completely different from what we're doing. we harness the power of the private negotiating market to negotiate deals, so, for instance, the way part d works, the system we want to try to emulate and use tools from in the part b is one drug plan might say i'm not going to cover this drug because i didn't get a good enough deal, and then another plan might cover that drug because they think they got a good enough deal, but the key is, the senior citizens are in the driver's seat saying, i need

that drug, i'm going to buy this plan and pay the premium for that plan because i want insurance there. you know, if you're in a socialized country, it's one size fits all. you can't exit other than getting on an airport to america to get access to that medicine yes? >> thank you people hear about this plan, read about the plan over the upcoming days, they are presumably learning about yourself as well, and they might say, wait a minute, somebody who was a pharma executive is in charge of lowering drug prices how is that going to work? your pitch to americans they can trust you to oversee this effort would be widse >> trust us by actions and deeds in the blueprint over 50 action plans that are the hardest hitting plans proposed by a president across the entire spectrum of every player in the industry to drive down drug prices and make drugs more affordable, and this -- i know this from having been on the other side running a drug

company and these issues, which is, i looked that if you can lower drug prices, it didn't work for any one company this is how perverse the system is you put yourself at a disadvantage in the system by having a lower list price drug than others, again, because every player in the system makes more money as a percent off of that list price. this is precisely why i'm so excited to be here in government with the knowledge that i've got and the team has about how we can change the rules of the road and actually change the system so that we can reverse those incentives to make that work, make those choices work, bring down drug prices, and make things more affordable >> when you rap a big pharmaceutical, why you couldn't lower prices was because you were at a disadvantage, and do you -- >> the math did not work >> do you regret being somebody in that system >> the system does not make that

work my job now with the president's commission is to make that work so the incentives work to actually bring prices down, charge less on the list price, and that's exactly what we're about is to fix that no one company on their own changes that dynamic, all the entire system actually is built for increased prices and high prices this plan reverses those dynamics >> one last question >> yep >> president said in the rose garden you were going to try to stop pharmaceutical companies from using patents what process do you plan to change if it extends beyond the budget proposal from months ago and see increased enforcement on deals. >> yeah, so one or two examples of the kinds of abuses we're talking about. you know, to be able to bring a generic drug to market or biosimilar to market, you actually have to prove your

version, your copy of it, is by yo equivalent to the innovator medicine you need access to the medicine to be able to run the tests and studies. way some companies are doing is locking down access to the medicines, hiding mind what are call called safety programs in fda, and they said, share it for testing, no problem, they are also creating limited distribution agreements with the distributors to not allow these generic companies access to them, and that's one of the things we're going to be going after to make sure these anti-competitive behaviors that don't allow the affordable medicines to get to market, we blow those away. well, thank you, thank you, all very much, and very complex system, of course, a multifaceted issue >> azar taking questions in the daily white house press briefing, pertaining, of course, to the president's plan to lower prescription drug prices, and,

by the way, welcome to "closing bell," i'm kelly evans >> i'm wilfred frost that address came after the president initially health care stocks sold off, rallied, and near the highs of the day. the broader dow up .25% and s&p roughly flat we get reaction from both of the last two speeches. >> interesting hearing alex azar now, hhs secretary, going into detail than we heard president trump going into in the speech ear earlier. in fact, takes years of restructuring the system to really see these changes when president trump in the speech promised this is going to happen fast take a listen. >> we'll have tougher negotiation, tougher competition, and lower prices at the pharmacy counter, and it will start to take effect very soon >> one of the groups said he went after one of the pharmacy

managers or middlemen, and stocks fell on the comments. listen to how he described them. >> we have to cut the middlemen, whoever they were, nobody figured it out, they are rich, they won't be so rich anymore. >> whoever the middlemen were, one could be express scripts up 3.5%, and dipped there when he said they would eliminate middlemen, but express scripts and others in the space rebounded along with drug stocks, those rebounding a bit, up a lot, calling your attention to regeneron, and regeneron up 8% after the speech that builds on gains earlier in the day. regeneron is really affected by part b medicare stuff that azar

talked about seems like investors reacted to that saying it's not as bad as reforms there as it might have the etf on this 3% strategists at jeffreys focuses on healthcare summing up reactions to this in an e-mail just now saying trump keeps denying nonevent comments overly vague, shorts are covering, massive waste of time. you can just see the whole drug industry here breathing sigh of relief because it's not major changes immediately. wilf, back over to you >> thank you very much for that sigh of relief for the stocks here in the broader stock exchange the coast guard is arriving as they will be ringing the closing bell later let's get back to the insurers, health insurance in particular bertha coombs is joining us now with reaction from the speeches we heard now >> thank you very much

your association says that getting rid of the rebates, which secretary just said, really, are part of the problem that creates this arms race for higher list prices, will hurt seniors and medicare part d. why would that happen? >> it's important to focus on the positive things, focus on list prices, focus on competition, getting gaming out of the system. when it comes to drug raeebates it's important to remember they are the entity that created the rebate system. now, right now, rebates reduced the premiums for seniors in the medicare part d program so everyone pays a higher price we're all in favor of lower list pricing, getting pricing down, but we have to look to secretary azar's appointment, how do you do it overtime in a way that makes sense to lower costs for patients, lower cost to taxpa r taxpaye taxpayers. >> one of the pharmacy benefit managers pointed out 100% of the

rebate goes towards lowering the premium. you put a dollar amount on how much more this could cost taxpayers if they were eliminated >> we did. the government, itself, estimated what the cost to taxpayers would be, incremental $40 billion plus over ten years as a result of higher premiums that the government's going to help cover through subsidies to seniors making them afford drug plans, and it doesn't count the additional costs, the changes they pay out of their own pocket across the entire program by way of higher premiums, so we think it's important it's looked at, 100% of the rebates are past through, collected, and information by the government on that, so we really need to look very carefully at that to ensure we're not inadvertently creating higher premiums, higher costs, and creating inacceptabilicentir manufacturers to increase prices >> not much time, but a question i wonder about is on the one hand they are sort of saying,

hey, middlemen are the bad guy, we clamp down on them, but they are talking about middlemen, whether it's the pvms and insurers, really, reaching their ability to negotiation how do you square these policies that they are putting together >> you know, some of the things that are being proposed to give more flexibility and tools to the plans, we are supportive of. there's a lot of improvements that could be made to ensure the coverage of products and prescription drugs and these medicare part d plans are more affordable, able to negotiate lower prices i think secretary azar addressed the games played with respect to pricing, and then letting plans have more flexibility to look at alternatives those are good things and tools the private sectors can use to help negotiate lower prices. >> all right, matt, thank you so much for joining us. kelly and wilf, back to you. >> all right, bertha, thank you. for more, we have e squared

capital management, joining us here at post nine, and you invested in the names. we want the investor's point of view >> sure. >> your take aways >> my take away is really that the stocks are at the highs of the day, so the market, itself, does not really seem too concerned. >> what was the concern >> regulatory reform, although, not surprisingly, moving towards the market base approach which without regulation probably not going to put too much pressure on prices in the near term >> is the market take and your take it's all talk and no action again? that's why they sold off and then rally >> yeah. it's not a coincidence that 202 all the stocks tip off, at least the market's interpretation. obviously, it's a long term time horizon for this, so we'll see >> that's part of it changes they talk about will take a long time to be implemented and work their way through the system, and figure out what that looks like, but

take them at their word that they are going to call into question the entire structure of drug raeebates and pressure of e participants in the system becomes greater. do you steer clear of the likes of the express scripts >> inevitable things like rebates and price gouging are going to go away it's just at what point in time, so, yeah, i would stay away from them, there's going to be a lot of volatility. there's a midterm election coming that's going to be more volatile, but we prefer idiosyncratic companies that are going to do well regardless -- >> such as >> oh, well, companies like conumbra, other lowers prices on their drugs by distribution chains, so all sorts of interesting companies, major robotics, you name it. if you are improving quality, you're going to do well as far as stocks are concerned. there are companies like united health and health equity that do well, you know, in a rising environment, and we also think

they are going to be doing well -- we are short some of the biotech and some of the large pharma because they have nothing going on nothing to do with macro factors necessarily. >> in terms of the speeches and announcements we heard this afternoon, has that changed conviction in any of the names you hold in terms of more or less positivity in. >> no. it's one more hurdle we left that i have to deal with we have to deal with the fundamental issues now, to give them credit, these folks have expertise in the industry that may be prior admissions have not, so they seem to know if you use the metaphor, bodies are buried, so at least they identified the problem, but i have a funny feeling this is a thing that may happen in the mid-2020 time frame where prices have gotten so high that people just throw up their hands >> you like unitedhealth because

of the rising environment, but rhetoric is about how they want to make sure rather than have higher prices, it does not incentivize that is that what you referred to there? if that pricing pressure goes the other way on health care, would unitedhealth be hurt, or is that not an outcome here? >> i would say they are talking about strictly using incentives, and in my judgment, incentives are not enough, market incentives because we had a market failure, and so we use market base incentives, market base incentives failed strictly regulatory regimes do not work because there's loopholes alluded to in part b we need a combination of both, and unfortunately, the two political parties are so philosophically apart, you'll find no middle ground so until they get it together, you know, we're going to be beneficiaries for a long time.

we're all lost >> well, les, thank you so much. >> thank you >> les with ideas what to do in health care amid the changes dow on pace for the best week in six, close higher today would be the seventh straight higher session, believe it or not, bob is on the floor of the new york stock exchange >> bottom today was as the president made the announcement, but turning around since then. a great week overall started last week with the jobs report i have to show you the big market movers on the dow this week because what we are seeing is the biggest sectors, financials and technology and industrials are the ones that are moving, and when they move, the market moves, so exxon-mobil and chevron, showing strength, caterpillar, banks are making contributions, and even material names, again, a smaller part of the s&p 500, and the dow, but dow up 4.5%, of course, big tech names, banks doing great, but

intel, microsoft, all up about 3% what's moving also apple, of course we still have a shot at up ten days in a row. we have not seen that since october 2010, ten days in a row up for apple, believe it or not. trading in line with the dow at 2.5% dow laggard is consumer staples. they keep dragging things down we can't get action from procter & gamble, coca-cola, walmart, unitedhealth, a lot of the health care is not doing much as well as for the market, i mentioned the bottom was right at 2:00 we saw all of those health care stocks move down immediately, and then just completely turned around there's cvs, pharmacy benefit group rallying, same situation with all the rest of the health care, anthem, if you look, big hmos down 2%, 3%, rallied back 3%, and eta holding in the hospital, same situation, down initially, cardinal health among the growth contributors, down

and rallied back obviously, the market is telling us right now that they don't see too much change from what was anticipated before guys, back to you. >> bob, thank you very much for that, picking up here, you mentioned we've seen a strong week from the fang names that's, in fact, without news flow from them on average, the four of them up 3.4% so far week to date. for reference, the s&p 500 up 2.2% week to date, nicely ahead of that, and the best performer of the fang names is facebook. up nearly 6% just this week, and you can see, pretty strong right in the middle of the week, google up 5%, interesting, therefore, it is those two advertising reliant giants who have been under so much focus recently, they are bouncing back with a big rally wednesday there for google as you can see. netflix and amazon and apple too, as bob said, all three much more reliant on consumer spend, up less, 2% on average for those three, and, of course, consumer

stocks not great this week for context, here's an etf, the fdn-etf for the whole year to date performance very heavy in the tech names and the fang names, and as you can see, right at the right of the chart, that's this week's rally in context for the year as a whole, taking them back to the highs of the year. kelly, back to you >> 20% gain, look at that. thank you. we bring in mike santoli, our commentator for take on this, mike, they shook off concerns now, haven't they? >> they have you know, when this market, when volatility goes down, people are feeling better about the tone of the overall market, almost by default, the big tech growth names do well, i do think, also, every rally we had this year has come from something that we thought might be scary that didn't come to fruition, so in this case, it was some kind of a regulatory crackdown on the big fang names the other interesting part is it was popular coming into the year saying, oh, we should see a

rotation out of the big growth stocks into value stocks rates are going up in theory, it was not as scarce as it was in the past, but what's the scary thing now the stainability of the earnings growth for most companies, for these, right or not, nobody sees this as a cyclical play or the growth expiring. i think it's a light version of 2017 i do think at 2017, but with head winds or offsets that we're going to hit if, in fact, you know, the fed and bond yields do not cooperate. >> how much is buybacks playing into this particularly related to apple, given that's a likely one-up factor in the foreseeable future >> sure. i say with apple the balance sheet, the cash return story is a much bigger factor than the other ones the other guys are pretty much just secular growth, don't do much mountain win the way of de buying back stocks, but apple, they have an authorization to

buy back more than 10% of the company at the current prices. >> yeah. >> berkshire hathaway owns 5% of the company. those are shares you put in the vault. therefore, the rest of the market with the largest stock in the world trying to own enough so to speak. it's been a factor >> next hour, we talk to ralph nader, he's concerned. mike, thank you very much. joining us now, hey, professor siegel, master of finance at the warton school in pennsylvania, and rick santelli in chicago rick, i want to quickly start with you you know, dow's up nearly 100 points right now starting to look bet here this afternoon. what do you think the overall tone of the market is? >> i'm very impressed with the overall tone in the market i do think with what's going on with stocks, what jumps out at me is not the fact they

rebounded. in the big picture, looking at all the volatility hitting in february, the reversal of the positions that packed in larger portfolios and volatility, we made a nice comeback is this done are we through it? i don't know i say 24,000 is a nice point to continue to revolve around it's fascinating many, of course, looking to see if we clear the 26,000 area, and i think it's possible. more importantly, look how interest rates reacted to the nice streaks as of late, the response has been curve flat ps. think about what that says the economy is doing better, but no not giving the same numbers it did in 2017. look at the stocks, it's golden notion in the investors' minds, that's here to stay and policy continues to snug. that's what we walk away with.

through the entire run with equities, look what's going on, up three on the week, down two on the week in 30 year, that's an amazing thought when you think about how much horsepower was developed since last wednesday. >> starting with you, professor, before we get to kenny now, but question broadly about the quality of earnings, what it means for valuations the how are pes versus historical standards >> well, pe is coming in very well i mean, we had such an earnings jump this year, most because of the corporate tax cult we had that we moved from about a 20 pe based on estimated earnings, 2017, and now down to about a 17, 16.5, which is an extremely reasonable valuation given interest rates that are nudging

upward, and this was a great week in terms of inflation news, building on that friday's moderate wages, but i caution people, we have a tight labor market look at jobless claims, 25-year lows, generating 200,000 jobs a month above feds' projections. they are raising next month and i think also september or december, so that is something i think the market has to contend with >> kenny, are you feeling better after the market after the seven-day run or looking too goldilocks out there >> i don't think it looks too goldilocks at all. the market feels better technically, breaking through the resistance level, which is a positive, closing above it yesterday, closing above it again today, and that's going to set it up. look, the other guest made those comments about the pes coming in, 17 more reasonable certainly than 20, and as long as the

market is okay with two more rate hikes this year, i think the market will be okay. talk about the fourth rate hike or wage pressure starts to put more pressure on the feds, then i think you are going to hit the head winds again from investors, and i don't see that happening soon i think the market is primed right now to really challenge 2800 over the next week or so because it could happen very quickly as we know >> kenny, you want to see more volume, though, to be bullish? >> i would love to see volume, but that's really just a function of market structure, you know, we've. talking about that, too, a lot of the markets midday disappears you see volume on the opening, and you see watch it again tonight, watch what happens to the volume in the last five minutes of the day, with a spurt in volume. midday it gets very, very antsy because the volume drives up i would like to see trades

signal there's much more commitment to the move >> professor, speaking of commitment, now you are looking at a market that trades lower, do you feel kenny's comments, that the stocks keep climbing higher this year >> well, i mean, take a look at the russell 2,000 strong caps, take away all-time highs a little pressure on the s&p because the dollar has pressure. look at the dollar, sunk earlier in the year, and it's come back 5%, s&p stocks get earnings abroad if the dollar goes higher, that's going to cut earnings and that could chip small stocks which are not as internationally exposed, but, boy, the base of the market in the small stock index looks good >> rick, the dollar has been strong in recent weeks, but actually this week is going to end roughly flat, settling down

its rise of late >> oh, absolutely. >> interest rates sunk down with the good producer prices, and it's a little pressure off that, and we're going to have to see, again, you know, job growth and the fed are going to be looming in the futures, and, of course, we all know, november, mid-term elections and what's going to happen in the house and the senate will be on people's minds, certainly, later this year >> rick, your take on the dollar >> you know, week seven, looks like we are a seller on 92.50, down from 92.57 last week. we want to watch 92.12 where it settled last year. it's not a bad thing to come back and test that one thing to point out to viewers, other central banks still doing a lot of quantitative easing, responsible for some of the capital keeping markets where they are to that end, on tuesday, we get the first look at q1 gdp

we are expecting a negative number they have not had a negative quarter in gdp since the last quarter 2015, call it two years. who is going to pay attention especially to see if the bank of japan, which is in remorse, ongoing qe, see if there's any type of headlines should we get a negative gdp they could ramp it up, playing into the equation of capital in markets. >> rick, thank you very much, thank you to kenny and the professor, have a great weekend to you all >> 14 minutes to go into the bell dow up 69 points today, and dow, s&p, and russell slightly positive, and dow by the most. nasdaq, though, negative territory, down 7 points this sckto today is down 5%, look at the mystery chart. we'll post it up after the break. this is a story about mail and packages. and it's also a story about people and while we make more e-commerce deliveries to homes than anyone else in the country, we never forget... that your business is our business

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evenly split between gainers and losers, and telecom leading 2% >> health care up 1 partnership partnership -- 1.5% >> real estate down half a percent today. >> we get senate's reaction to president's drug price announ announcement with bill cassidy (slow jazz music) ♪ fly me to the moon ♪ and let me play (bell ring)

welcome back, down to the floor where mike is in the post up position looking at yelp, mike >> yeah, kelly, you remember about 23 hours ago, yelp reported results, looked good, and in fact, considered good in terms of top and bottom line, but light on earnings guidance at post five, stock is down 8% today. seems like a reaction to a couple things. one, stock's been on a huge run, still up 50% over the last 12 months even after the decline, but, also, a little bit of uncertainty surrounding the new strategy for selling ads, going away from sort of a one-year contract for advertisers, making it more flexible for them, and some investors are not sure how it pans out, advertised insurance, seems like an opportunity for profit taking in a hot name, guys >> mike, thank you see you in a couple minutes. >> we have just six minutes left of trade up by 62 points on the dow

right back for the closing countdown. >> it's going to be a silly version that gets people looking at your weekend, right >> not quite it's got some friday fun, though >> stay with us, after the bell, spotlight on stipofy, why they removed a top singer from the play list. this is the "closing bell" on cnbc, first in business worldwide.

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welcome back to the "closing bell" with three minutes to go until the close, that means three minutes to go until the weekend for me as well we look at the main sector mover, s&p 500, health care sector intraday, when president trump started that speech, we did see a big selloff, particularly in the pharmacy benefit managers, down sharply, at 2:00 p.m., rallying strongly after that after people thought it was all talk, no action, and, certainly, it's the action that's going to come a long way away that was the driver of the intraday chart for the market. here's the s&p 500, itself, all the sectors in the red, selloff, just there, when the health care sector came down, but rallied on into the close, and we are nicely higher for all three of the indexes off, certainly, the dow at the moment, at the end of what's been a strong week. we move on to look at the individual moves we have not had time to talk

about them symantec down, news corp. down sharply, disappointing earnings, and verizon is up decent set of numbers from them, and talking about whether the former aol ceo would go to wpp, and regeneron a great example of a health care stock that sold off initially, now rallying up 6%, was up 8%. quick look, now, for the week to date sectors with bob pisani a positive set of numbers for the week, up 2% for the dow, nasdaq, and s&p as a whole telco led the way and health care enjoying it today we switch to the sectors for the week as a whole in a moment, but it's been energy that's been a big story for the week, also, some of the interest sensitive names like financials doing well as well. >> what you want here, what matters in the s&p, technology and financials between the two of them, that's about 35% of the s&p those were two big leadership groups, when they are up 4%, the s&p is going to be up 4%

energy's a big help, but energy is 50% it had a great week, a good thing overall, and telecom does not matter, 2% of the s&p 500. what matters is industrials mattered as well, they had a nice week. so you get tech, you get financials, you get industrials moving, s&p is going to move regardless by the way, i want to reference what you talked about earlier, the drug stocks turning around people i looked at and talked to mentioned the fact there was concern hhs people may bring -- they might want to allow medicare to directly negotiate with the drug companies, an issue for years, and democrats called for this. there was nothing in the mapped to do that 30% of all the prescriptions in the u.s. are onprohibited, not allowed to negotiate, and if somethingfuls ma was made about it would have been different

relief rally would not have been but there was no mention of it >> dollar on a strong rise in the last month or so, but this weekends essentially flat, a little bit reprieve for exporters. there goes the bell, up 88 points on the dow, nice literally in the final hour. looking at whether the 2% gain for all three indexes in the week, ringing the bell here at the new york stock exchange is the united states coast guard, congratulations, and at the nasdaq, weby that's all for this week's trade. kelly has the second hour. thank you, wilf, and welcome to "closing bell", everybody, i'm kelly evidenanevans. dow gaining 100 points, 24830, seventh consecutive day of gains, also making the blue chips best performing average to date, and s&p 500, smaller increase at 4.5 points, and

notably, the top names in the s&p are health care and drug names, after the president's announcement to crackdown on prescription drug prices russell 2,000 up .2%, three points to 1606, close to an all-time high, as small caps did well finally, nasdaq did not participate, closing a couple points lower today to 74.02. more on this, and joining me on the panel this friday, cnbc senior market commentator michael santoli, kevin newmark, and, guys, welcome to all of you. i hope you have taken care of your mother's day plans? >> we have time, right >> yeah. i mean, i think on wednesday or thursday the market -- anyway, biggest winner on the dow was caterpillar, and walmart was the laggard going back to the deal for flip card in india s&p trip adviser was the biggest and symantec the loser with a 30% drop today on accounting

concerns along with earnings mike, it is interesting that health care biotech names took the price in the announcement, but more than that, what do you think of now the seventh straight day of gains? >> impressive. today was a breather it was basically a push in terms of up versus down, stocks and volu volume, and the rest of it, but that, in itself, is impressive, considering we had a seven-day streak i think, in general, the market appeared more comfortable with the idea that this correction did its work it got valuations down earnings have been good, and, by the way, the market stopped responding so sensitively to what might happen bad. so a week ago friday, remember, a week ago, it's been selling off on friday, you don't know what the weekend brings. it did not do that a week ago. >> a difference, the hostages came home from north korea there's date set for the summit between the president and the -- i mean, geopolitics worry moved off a little >> i think we are putting that off for the next week and a half or two weeks nafta renegotiation is coming up

and the decision, i think, may 22nd on the chinese tariff decision that's the first deadline or two on that, but for the time being, i think the way iran played itself out over the week and the way north korea plays itself out is favorable for the white house. all the micah cohen stuff, interesting as it is, and it is interesting, it's just noise, just noise >> the market could easily if so inclined take it negatively, said, a delegation went to china, came back empty handed, decided it was a negative, and market stopped deciding these things matter much in the here and now. >> with the pulling out of the iran deal, they could have said missiles going back and forth between iran and israel, there's more, and granted, oil prices, you must be feeling good on energy >> i am feeling good it's -- if you go back to late 2015, early 2016 when oil prices were down in the 40s, and then they bottomed in the low 30s, i said i'm buying on a two to

three year time horizon. that's what it is. >> clocked up? >> doesn't mean it's up, but i was overweight in energy i'm not telling you where. >> only one in the market. >> i must be the only person who is ridiculous overweight in energy right now >> so many hedge funds and institutions in the last months talking up energy. does that make you nervous too >> i saw it this week, just to -- i'm so far off what the market waitings are, it's a little bit embarrassing. i'm not going to roll the dice for another month or two, but the bids in energy prices is not about going away in a night or two. >> mark, bringing you in here. a lot of people said, when tech was not leading the way, maybe it could be energy or maybe financials how do you feel now that the market is positioned >> well, certainly, encouraging, kelly. i mean, i think what mike was saying, it was not but the last couple weeks leading up until this week or so where we saw the

market react negatively to anything that came out, and we're seeing the same news flow this week, instead, markets reacting benignly or positively to it, and in addition to that, we are seeing breath indicators right now, whether you talk about the percentage of stocks, fifth year, 200 moving day average, and stocks advancing versus declining, so this is encouraging, sponsorship is creeping back into the market, and it indicates that perhaps worst of the correction is behind us, so, also, rotation into energy and financials is very interesting because, obviously, that is a value tilt, which is lag growth dollars investing for the longer participant of a decade, and not necessarily that technique to roll over, but necessarily usurp the other two sectors, i think that's very encouraging for the market going forward >> i want to bounce something quickly off you guys there was a point in a note this morning about how now that companies sold stock in the market, investors bought it, but now it's the other way around, companies buy stock, and retail guys know where to be seen, you

know, generally speaking, and, mike, is that -- is that - >> i think it's an interesting way -- >> is that a free market >> if you look at the entire market as one company, you can actually think of it this way. look, debt levels are up they are using, you know, cheap debt to, on a net basis, buy back shares. really, managing the company for the benefit of shareholders, not dilute them or make bad investment decisions with shareholder money, and that's been the theme for a long time now, so i think what that really tells me is keeping an eye on the credit metrics, are the markets okay and firm remains the backstop for the market, and they are so far. >> is it healthy >> not tremendously. i think the jury's still out on the trump-related tax cuts as to whether it's going to be this investment boom or whether they use it for buybacks. it seems to be that certainly some companies are using it for buybacks, and that's a big chunk of the action in the stock market right now >> yeah. >> but i still think, you know,

we had tame price inflation data this week, and i still think the jury will be out until we see kind of in the autumn of the year, whether or not we're getting, like, economic growth that supposedly the tax growth brings out i think the jury's out i do think that the wealth disperty, buyback of stock, all that theme, i'd like to take that out of the market and like a really broad based main street kind of investment boom. >> nothing like ralph nader. >> well, no, i think that would be good for everybody, though, if that did happen >> all right let's talk about the president's announcement this afternoon. he revealed plans for drug pricing reform, highlighting ways his administration has begun to turn the drug industry around >> my administration has already taken significant steps to get drug prices under control. we reformed the drug discount program for safety net hospitals to save senior citizens hundreds of millions of dollars on drugs this year alone.

we're also increasing competition and reducing regulatory burdens so drugs can be gotten to the market quicker and cheaper. >> now, drug stocks, especially names like express scripts fell slightly in the speech but bounced back and closed higher on the day, in fact, the top performers in the s&p 500 were all in the health care and biotech space. meg has more along with chip davis, president and ceo of the association for accessible medicine meg? >> thanks, kelly chip, thanks so much for being here this afternoon. >> good to be with you >> so you watched the president's speech what are your takeaways? >> meg, millions watched the speech i think, obviously, the blueprint is substantive, right? credit to the president, secretary azar and their health care leaders for proposing some 50 odd policies. two key takeaways. one is the robustness of this, recognizing the market place is complex. two, if you look at the

president's four strategies, first one to increase competition and the fourth one lower out of pocket costs for patients at the pharmacy counter, those things are aligned with the value proposition of generic and biosimilar, so on that front, we very much look forward to working with the administration to realize even more value for the industry and more importantly for patients >> there was a lot of focus in the president's speech about increasing competition, trying to see generics to the market and removing barriers to developing generic, but isn't there inflation pending to solve that problem where generic drug companies don't get copies of branded drugs to test their drugs against them legislation for that, already, the fda is speeding up drug approvals, anything new here that's going to affect your industry >> well, there was, meg, and actually a couple things, glad you raised that. it was important to note that prior to now there's been a discussion that the administration was going to look at how much they could do of themselves the president specifically called on congress to help lead through this commitment, and that's where acts like the creates act, allowing our

companies to gain access to sample drugs to do the necessary research and development and create files for competition, that's a bill stalled in congress that could now move forward with the excitement of the administration to ensure more competition i think what's interesting to point out is that while it's been fantastic under the leadership of dr. gotley of the fda, a record of approvals in the last year, for the generic and biosimilars industry, that's half the battle. getting to market is half the fight. staying in the market and ensuring you have a sustainable market, andthere's increasing challenges there with fighting through patent abuse or contracting schemes, some of which secretary azar spoke to, we look forward to working wa ih the administration to resolve the issues and companies both get to market and stay there providing deflationary benefit seen in generics historically, but not with branded products generally. >> you see in the past it's been

valeant, massive price spikes on older generic medicines. secretary azar mentioned for sing single-sourced generics, they might take action to prevent price increases. do you see that in the industry and would this stop those? >> it's important to distinguish between old or off-patent medicines in the traditional commodity generics there's confusion in there one does not equal the same. that said, what ails those unique markets the secretary spoke and commissioner spoke about is the very lack of competition, so whether it's the fda putting out a list of products in those areas that are subject to regulatory arbitrage which nobody supports, and encourage others to try to manufacture and file applications to get the applications prioritized at fda, those are really important steps to ensure we don't have any types of those situations moving forward. >> all right chip davis, leaving it there, thank you so much for being here >> thank you >> kelly, back over to you >> all right, meg, our thanks to

you, meg, covering all angles of the story for us mark, quick two cents there you on the significance this has for investors in the space right now? >> well, of course, as they said, market's reaction initially was to selloff in hopes or expectation that it was going to derive into something worse than what the market already knew, and then by the end of the speech, we saw the rally across, really, the health care sector at large, pharma, biotech, looking at any of the health providers, almost uniform in terms of the bounceback, higher lows than where they peaked today at any point in the day, and that's indicative of investors knee jerk reaction is not having learned anything new not already factored in the prices at this juncture. >> mark, appreciate your perspective. thank you for joining us today >> thanks, kelly >> that was mark, and, scott, on the screen, we are about to possibly finally see the launch of elon musk spacex launching at

kennedy space center, scrapped last minute yesterday. morgan brennan. >> reporter: looking to achieve a milestone to launch this last and most powerful version of the falcon 9 rocket. this would be the maiden's flight of the new version, a flight attempted yesterday, coming to blastoff were a technical issue scrubbed it. spacex is trying now just seconds away, and to put this in context, why it's watched closely? this new version of falcon 9 will be flown ten times with no planned maintenance between flights up to 100 times over the life of each rocket so bringing this reusability concept that spacex has become on the forefront of to new heights. so we're taking a look at this right now. we are just about a little over

20 seconds away. in terms of the launch itself, this is going to lift bangladesh's first satellite into orbit, taking place from spa spacex's launch pad at kennedy space center 10 seconds away here i think it's -- we should listen in as the engines fire up. >> six, five, four, three, two, one, zero, ignition, liftoff [ cheers and applause ]

[ rocket noise ] >> reporter: so this is the inaugural flight of the latest, most powerful version of spacex's falcon 9 rocket you can see that blasting off, heading towards orbit right now with bangladesh's first ever satellite. it's gotten more thrust than previous versions. falcon 9, and the plan is to be able to reuse each of these rockets up to 100 times over the course of their life now, in the next couple of minutes, next seven minutes or so, the company is going to attempt once again to reland that booster in the atlantic ocean on a drone ship, a process they have been doing regularly now in the past several years. as it moves forward greater and greater reusability around the

rockets and its hardware >> it's great to watch, especially, guys, when we know they had difficulty getting this off this week. elon musk, listen, for all the stuff he's taken, let's say about tesla and the pressure to perform there, what he's done with spacex is tremendous. >> a good rocket launch, never tire of it >> holding my breath that whole time >> you remember from the early space program days >> exactly yes that was an insult, i know that, mike, i'm aware, but it is amazing what private industry has done when i was growing up, when i was growing up, this was done as part of the space race, done by the government, and i don't know -- have you ever been down to cape canaveral, kelly >> i have not, no. >> it's amazing place to visit >> i want to, actually >> i recommend whether or not they have a launch, go down there, there's a great museum there, and it is amazing the way that in the united states, the private sector has filled what was a huge gap down there.

when at the height of the space program -- >> and, by the way, not just filled it, and it's -- this -- the next phase of this becomes more fascinating to see if they land this. >> yes >> reporter: kelly, to describe what's happening on the television screen right now, that first stage booster has just separated it's now going to start to make its way back down to earth and back down towards that drone ship sitting off the coast of florida in the atlantic ocean. >> yeah. should take just a few more minutes. as morgan said, they hope to use it -- not just private industry got this far, but he's doing it at low costs >> yeah. >> with an eye towards making the economics of this better and better, and for a couple years, spacex had a real tough time sticking to schedule, but now they are more consistent we are seeing them launching ever larger payloads, and now if they use this thing ten times between maintenance or 100 times total, another big step. >> amazing in perspective, at the height of

the space program in the early '70s, down in cape canaveral, 25,000 people were working there. >> wow >> up until recently, and the launch of spacex, operating out of kennedy space center, there was few as 5,000 people. >> huh >> it just you look in that small community around the kennedy space center, the number of people employed went down to one fifth of what it was >> a contentious issue in terms of how much money there should be in this for washington. trying to devote resources, whether it's to the moon landsings and continue to go there route, or to mars, of course, another big priority of musk's >> a different set of priorities now. 40 years ago, talking return investment, in financial sense, right, a different gain. >> now looking for the return of the rocket should be a couple more minute's time i think about eight minutes total for that landing to occur on the drone ship.

spacex had a number of successful ones already. for this one, it's to see whether they not only land it, but continue to relaunch the rocket without needing to do that much maintenance on that, up to ten times, and even after that point, up to 100 times. >> reporter: kelly, on a call with mia yesterday, musk saying to us ahead of this launch, that his goal coming into next year is to be able to take one of these new falcon 9 rockets and do two orbital launches within 24 hours so two launches within the same day. that's - >> wow >> reporter: that's how aggressively this company is looking to ramp up itself ability to reuse and turn around these rockets and really speaking to this vision that he has, and it's becoming more common throughout the space industry in general looking at rocket launches like airline flights. >> yeah, and i'm not saying that, you know, car business has anything to do with launching a

rocket, but don't you think every time one of these goes well it adds credibility to elon musk for setting high endeavors for the others as well >> potentially it's to the process it's a mass level, repeatable, quality control across the fleet >> interesting thing is that it's not always the revoluti revolutionary thinker who reaps, you know, the benefits, as ed edison versus tesla. two approaches to electricity. thomas made a fortune, and tesla never did. >> and george westinghouse in there somewhere. >> somewhere, i don't know where, so i'm not going to comment. >> probably in pittsburgh. >> morgan? >> reporter: yeah. on the left side of the screen, what you see now is that first stage booster that main most expensive engine part of the rocket going back down into the

atmosphere to land on earth. on theright side of the screen that is basically the satellite, payload being carried up into orbit, ultimately target 22,000 miles above earth. >> and this is a bangladesh satellite, their first one >> reporter: it is, the very first one. >> huh these things are not cheap >> the landing part is most min boggling >> like a gymnast in the olympics, the routine looks good, but can she stick the landing. that's the key question, because, morgan, that's the point of what spacex is doing here reusing rockets >> reporter: absolutely. they have been on the forefront of this, but many of its up and coming commercial competitors, similar ideas around reusability, jeff besos's company is a good example, working on their own orbital rocket available in a couple

years issue and something that's traditional rocket maker, united launch alliance, between boeing and lockheed martin is looking to start harnessing that reusability technology with their next generation launch vehicle as well. >> by the way, is there -- >> reporter: a technical situation, basically, one minute from blastoff, the computer takes in and takes over, and it was -- it was triggered, and it stopped the launch process it was basically an automatic abort of the process >> huh that was yesterday a two-hour window to get it back in the air, obviously, did not do that, and here a couple minutes ago, let's listen in as we look to see if they can do the landing. [ cheers and applause >> and --

[ cheers and applause >> looks like she stuck it >> yeah. pretty amazing >> wow >> reporter: this first stage booster of the block five falcon 9 rocket, the first one to launch, has just land on a drone ship in the atlantic ocean elon musk and spacex notched another successful launch. >> wow >> morgan, the biggest payload up there so far? getting bigger and bigger, am t aren't they? >> reporter: yes, yes, that's what the redesign of the rocket brought as well, more power and ability to lift greater amount into space >> you can see there on that map, where the drone ship is in the atlantic we just saw that rocket come back down, stick its landing,

and deliver musk a huge victory. morgan, thank you for walking us through it >> reporter: thank you >> morgan brennan, your live shot there, as the payload itself a bangladesh satellite goes into outer space. really cool. >> always really, really cool. as i said, makes a tesla investor feel better, but i don't know there's a direct connection between the two >> that's fair, but, still, congratulations to them. next up, key senator's reaction to the drug pricing plans. stay with us

welcome back president trump taking aim at the soars cost of prescription drugs in a speech at the white house this afternoon >> in the coming weeks, we will work with congress to pass legislation that will save americans even more money at the pharmacy for that, we need the help of congress, and we think it will be forthcoming >> well, senator bill cassidy of louisiana attended the speech. he's here with us now. senator, welcome >> hey, thanks for having me >> you, in fact, do have work in congress, bipartisan work, we add in this polarized age, does it jive with what the president said today >> we doing several things in health care, pushing for price

transparency that absolutely jives with what the president spoke of today someone getting a prescription or getting a blood test or x-ray ordered should know the cost of that before she has it done can be compared to getting it done someplace else the president is all about that. removing gag orders so the pharmacies can tell someone that her prescription would be cheaper for her if she paid cash opposed to paying the insurance co-pay there's a lot to like in this bill >> that said, yeah, we looked at the reaction, of course, to the health industry, to the announcement, and, now, you initially saw some pressure across these stocks, senator, especially some of the pharmacy benefit managers, drug district and they closed higher in cases. do you think the industry should be shrugging this off? >> i actually think this is fair there's no bad industry players.

they are just incredibly bad incentives, and each has a role, for example, pharmacy benefit managers, in some way, their role is expanded as the administration suggests that some drugs can under medicare part b is negotiated in a medicare part d, than as increased role elsewhere, looks to see whether or not the rebate activity, secret agreements between manufacturers and insurance companies should be trimmed back, but pbms were created to negotiate. their role is preserved. what should be trimmed back are secret rebate deals that probably cause the consumer to pay more i think it's fair to all the players. >> senator, you heard that whenever it is this kind of thing is brought up, various people from the industry say, well, you know, it's very complex. we can't just have a straight list price and don't know reimbursement rates and reasons to create incentives and all the rest can this cut through to that and

a good chance of passing >> i find that when people -- when people complain about the principle or complexity, what they mean is they are going to lose money, and at some point, you got to take a sledge hammer to it. i think the president's trying to do that if you list a list price, yes, that includes a rebate, but the president is speaking about eliminating rebates, in which case the list price should go down so i think there's kind of interlocking features here which make it fair to pharma if you advertise a drug, tell us what it costs. if you are paying more because of a rebate, let's get rid of the rebate and then see when it costs, and i actually think that creates a dynamic, a pressure to do the right thing >> gillead is a critter to you, senator, health professionals in general. is that because they are concerned about the direction this legislation might go? do you think they will be helped more or hurt by this, by all of this talk about regulation

that -- it's going to -- it's just not going to have that much bite >> i can't -- i can't speak about a specific industry, but one provision they are looking at, for example, gilead produces a drug for hepatitis c i looked to see if we can get a drug from them or another provider at a certain price, we save money buying it over 30 year period parties need it because of fewer cases of liver disease. in this proposal, they speak about long term financing provisions, something i worked on with gilead,merck, and others if the president makes that happen, we create access to medicines for likes like hepatitis c, americans livings and taxpayers save money and opens up new opportunities for pharmaceuticals. a win all the way around >> understood. final question before you go,

hhs secretary azar, himself, said in his question and answer segment today, he said, we are restructuring an entire leg of the u.s. economy does that make you nervous, that talk from washington, or exactly what we need >> we need that. there's so many incentives that benefit the pharmaceutical industry and insurers, but do not benefit patients patients are getting hosed as a doctor, i want patients to do better, restructure so she is first with the power, not other players in the industry. >> all right senator, thanks for your time today. >> thank you >> senator bill cassidy joining us to react to the president's announcement drug makers move in after hours trading, meg, anything to do with the announcement? >> not so much, but the hhs, perrigo does not expect the fda to approve its inhaler this year, expects fda to have a

complete response letter indicating they are not going to approve the application. as a result of that, they don't expect to get the pro-air generic product approved in the 40 quarter of 2018 and say, therefore, they no longer expect to achieve the about 9 cent per share benefit included in the 2018 adjusted and reported eps guidance range perrigo down 10% teva makes a competing product, and they are not seeing this competition this year according to perrigo back to you. >> thought it would be up more, but still a fractional gain, meg, thank you time for a news update with sue. sue? >> heldly, kelly, hello, everyone senator rand paul speaking out about the cia nomination of fellow kentucky gina haspel who has been criticized because of her torture after 9/11 he said because of that, he is holding out support.

>> we put the japanese in camp, these were dark periods in our history. we need to look to the brighter side of who we are as americans, who we are as people that does not include torture, so when haspel comes up for a vote, i'll be a no because i think we can do better than that. fires continue to burn in texas, the largest in armstrong county and burned 34,000 acres the fire is only 15% contained most of the fires are burning in rural canyons in that region an 81-year-old australian james harrison made his 1,173 and final blood donation today the end of a 60-year donation streak that has saved the lives of 2.4 million babies. his blood plasma happens to contain unusually high levels of an anti-body used to make life saving medicines for babies who

have a different rh factors than their mothers. he's known as the man with the golden arm >> i thought at first, sue, he returned after having 2.4 million babies >> no, no, he's the world's largest, in terms of volume, blood donor, and only reason he stopped -- he wants to continue because his plasma is so unusual, but in australia, there's an age limit, so he's aged out >> oh, i'm amazed you can do it even as much as he has, all those donations. >> yep >> so squeamish. >> that guy, at least, he saved lives, not like the guy who ate 30,000 big macs. >> exactly >> he saved -- god knows - >> that guy is saving common sense, by the way. >> 2.4 million babies he saved >> yeah, exactly sue, thank you very much >> you got it, guys. >> happy mother's day. >> thank you, kelly! appreciate it very much. have a great weekend >> you too apple snapping the nine-day win

streak, but the stock is getting closer to a trillion dollar market cap, so close coming up. fast money" says whether they take a bite from the stock, and spotify under fire for censoring what they call hateful artists reactions when we come back. a bulb of light?!? aha ha ha! a flying machine? impossible! a personal' computer?! ha! smart neighborhoods running on a microgrid. a stadium powered with solar. a hospital that doesn't lose power. amazing. i like it. never gonna happen.

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spotify booted r. kelly from play lists it makes for users, citing a hateful conduct policy.

they cited him over two decades, and kelly denied accusations and spoke out about the decision saying spotify is acting on false and unproven allegations, bowing to social media fads and picking sides in a fame seeking dispute in a matter that has nothing to do with serving customers. they said we don't censor content because of artists or behavior, but what we choose to program needs to reflect our values we have been following this, and you are with variety, so thank you for joining us >> my pleasure >> spotify is in a pickle saying they choose not to promote r. kelly, what's the rapper's name? >> xxxecontion, based on harmful behavior >> not going through it one by

one, but if they made the step, this becomes something they have to constantly deal with. >> well, they can't. frankly, with the short-sided decision, and it was announced very quickly nobody really saw it coming, and worst of all, you got two black artists, two male black artists as the only two people censored. censor is is not the word, but penalized for this censorship, it's not the issue the music is available on the site, but not promoted by a play list >> so why do you think -- there's an article in the "washington post" about r. kelly specifically they seem to be responding to. is it -- what would be the alternative for the company? we have not seen other music platforms doing anything in all. why did spotify step forward >> in the beginning of last week, me too called out r kelly's record label,

ticketmaster, apple music, and spotify for supporting them. they did not brand them, but mentioned them, we want you to join us in, you know, our efforts to mute r. kelly, that's the hashtag, so they were responding to that want i don't they they like being presented in that light. what they could have done is just quietly remove them so that way there's not a stated policy that it has to be applied across the board. that's the way other streaming services do it, and it would have been tidier >> in theory, they could have done it in a arms like technological way. they are algorithms. people have the tools, i don't want to hear it, block the artist >> oh, that's interesting. >> make it neutral >> or said, you, as the user, if you don't want this promoted to you, you can - >> yes >> if they had the tools >> the capacity to do it >> opt-in is also there.

irony, they got destroyed in the media. the stock shot up. >> well, who knows real quick, thoughts >> i'm curious, like, the harvey weinstein and shoes drop how many other shoes in the music and rap industry broadly, this is something they could find themselves having a, you know, every day is a new press release. >> it's a closet full of shoes to drop. >> jem, thank you for joining us >> thank you >> interesting to see what they do and if anyone follows suit. apple shares finished the day lower, breaking a multiple day win streak despite that, the stock still hit multihigh of $189.44 this week very, very close to a $1 trillion market cap. joining us are the "fast money" traders. mike, kick us off here is apple going to do it? the first company to be a trillion dollars in size >> yeah. i think they probably will be, although, i don't know that that

compelling reason is to buy the stock here important thing to remember is they are almost there already. it's a move of 8% off the close levels that would have been smaller from where the stock was coming from, and so, is that a stock you want to run in and chies at these levels, based on the buffet story or fact that it might have five to 10% worth of upside here? you know, it's a great company, obviously, and the valuation is not terrible, but i don't think it's a screaming buy either. >> david, it is hard to say, you know, any time a company's coming off what was a ten-day win streak >> right >> feels like, okay, maybe people are getting too excited >> yeah, exactly ten-day win streak, especially with the noise or sort of, you know, story around it, pushing higher i would not chase it here. old range, close your eyes and buy it, and upping the range a bit, probably, you know, 190 now is the high enof the range, and when it comes up, and 170 is aer

no-brainer don't chase it here. does it become the trillion dollar market cap? i think it's potentially does over time, and i think the key to the story really is looking at the margins of their services business, if they continue to grow that business and accelerate getting the margin improvement, the street does not have a lot of margin improvement. that could be the win for them >> got to go >> lastly, mike. >> sell if you own the stock >> ha-ha, all right, that puts a point on it. guys, thank you both >> thanks. >> much more ahead on "fast money" in 15 minutes at 5:00 p.m. eastern still ahead, consumer advocates taking on apple over its massive $100 billion stock buyback after this

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that >> i think that this further proves that the president's not going to be influenced by special interests. this is actually the definition of draining the swamp, something the president talked about repeatedly during the campaign, and for anything beyond that, i direct youto the president's outside counsel. >> the definition of "draining the swamp" >> i think it's clear that the department of justice opposed the merger, and so certainly the president has not been influenced by any or his administration influenced by any outside special interests. >> reporter: saying that because the president opposed the merger between at&t and time warner and the president's justice department took steps against it, that shows personal lawyer taking payments from at&t is the definition of draining the swamp. i asked at the end there, you didn't hear it, whether or not the president was aware of the payments, and she did not answer that question, kelly there's going to be more questions here for at&t including what was the work

product that michael cohen produced for now reported to be $600,000 in payments from at&t >> yeah, thank you eamon javers chasing that story for us ralph nader penned an open letter to tim cook about the buyback announcement saying it's short term nonsense other than positive impact on other met tricks author of "breaking through power: it's easier than we think," thank you for your time. >> thank you, kelly. >> you're a shareholder, right >> yes, we're trying to get other shareholders to raise a very important issue tim cook and two other men made a decision to take $100 billion that belongs to the shareholders, institutional and individual, and decide - >> give it back to them. >> decide to buy the stock back. which studies have shown - >> right >> over a period of time does not affect the value of the

stock. all you do is look back 18 years of buybacks from walmart, but to show you - >> you made a list of things they have done with the money. i just want to make people aware m one, they could pay aone, pay a bonus bringing economic relief and happiness, two, diminish supply chain, waste material in africa three, combat saexcessive iphone use by neighborhoods, cut prices or other more convention's things a lot of investors would be upset if apple started to throw $100 billion around to those kinds of causes? >> well, it's not their decision it shouldn't be their decision it belongs to the shareholders could do one of two things suspend the stock buyback and ask the shareholders for approval or they can ask the shareholder for their ideas, and put it out there. because $100 billion is a lot of money. it's five times the combined

budget, kelly, of the epa, the osha for worker health and safety. >> let me bring in mike for a second $100 billion of their $250 billion, it's a move investors rejoice about now given the performance of the share evan, you're not keen on buybacks. >> i think the point i think ralph is missing in effect is he notes that it's basically shareholders' decision, but whether we like it, he likes the board, doesn't like the board, the board in effect is the proxy for the shareholders the one making the decision. i'm sure they were voted, the board voted on the buyback program. i'm sure it was a composition of both a manager board members as well as outside board directors, and so my advice to ralph, i'm sure he appreciates this is, you know, if you got a problem with the board, vote them out that's what you should do, if you have a problem with the buyback. it should be about the board less about the actual buyback

itself. >> we want discretion. the ceo of the giant investment fund blackrock said in a letter to ceos in february that financial performance is only one criteria that these companies have to "make a positive contribution to societ society" there are all kinds of things that are within the framework of the -- >> by the way, who's to say he's right? can't apple come out and say we have a fiduciary duty to our shareholders and it's part lly apple fault and companies like that saying we want to fulfill a positive social purpose allowing them to be criticized for not pursuing funding the w.h.o. like you suggested? >> no. by comparison, gigantic, more than epa, world health organization, on and on. i'm saying consult with their owners excuse me. what kind of capitalism is it when the owners can't even be

consulted on $100 billion of their own money? that can go into many other areas that fulfill a longer-range stability and mission of the apple corporation, starting with the horrible conditions in the african mines for a supply chain to 350,000 workers in china surf labor in terrible condition. >> last word in. also sell the shares that's how you exercise -- >> classically -- but also a feeling if you put it to an open vote, they would say, yeah i think a buyback sounds like a pretty good idea, for better or worse. a company like apple has accumulated cash how do we best use it if we can't use it properly internally, share it back. >> if you -- >> better way, kelly. >> lasts word. >> take his framework, give it to shareholders and dividends. go to shareholderrespect.org and

hear from shareholders i believe in corporate democracy. >> when we want everyone to have their vote ralph, thanks for joining us. >> thank you, kelly. >> ralph nader on apple's biback. one hot sector about to cool off. a technician tells what you he sees in the charts we'll be right back. alerts -- wouldn't you like one from the market when it might be time to buy or sell? with fidelity's real-time analytics, you'll get clear, actionable alerts about potential investment opportunities in real time. fidelity. open an account today.

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wasn't my plan and it's so cute to see her with her daughter now but still not really back into the swing of things, is she? >> no. the thing about serena and convenience, they're remarkable. people don't appreciate how much thank you overcome from where they grew up and both had physical challenges over the years. pulmonary, diseases that they've dealt with and overcome. sort of the lesson from our book we talk to various athletes, all female how they overcame everything from racism to physical differences. >> and i don't mean to put it this way, motherhood how much does that crucial decision come up when these are people, women in the prime of their athletic lives trying to figure out how to balance that >> simone biles we spoke with grew up without her mother had a real impact on that, she had to deal with that. with all the stars they found somebody in their lives to turn to a coach, or a therapy it simone work with a therapist, dealing with stress, her

upbringing everyone found someone, encouragement, people are out there, a mentor of some kind. >> i wonder, too think about the marathoners, where they basically have to plan, okay the next five to eight years of their lives around which marathons will i run what is my training gob to be like how do kids fit into that? but feel it's something important enough that they -- they have to do. >> right women have another layer of challenges one could argue especially in our society and issues, all the women in our, men and women, in our book, had body shaming issues they had to deal with. my sons and i talked to them and remarkable how they had to deal with that. simone biles, we think impressive young woman, strong, growing up made fun of her wore baggy jeans, and baggy clothing to obscure the muscles. here she is with my wife there you go. >> you did have some female input on the project >> yes my wife played a nice role as

well. >> big plans for her this mother's day don't spill the beans. >> no. might be watching's no tip-offs, it's insider trading. >> congratulations on the book, everybody should get and read, maybe gifts for mom, not too late. >> since on-set, final market thought. start with the guys, work down to you, though what are you watching heading into next week >> honestly, to see if the market feels like it's back to normal the way it's acting all week normal, not overly agitated by macro stuff. to me, market reacting to itself is key. >> i hate to say -- looking at donald trump been on a bit of -- not a huge trump fan. >> obsessed with the guy. >> out in on a bit of a nice geopolitical streak here curious to see whether it continues. if it does -- >> kudos or -- too far >> save that until after they go to singapore. >> greg, you >> i focus a lot on the quance lately more important technical a little more important. used to dismiss that and laugh

it them. right? 200 moving day why does it matter and more quants in the market, a focus on about secure, once obscure technical measures those things i'm interested in. >> pleasure to have you. congratulations with the book, a side project, with everything else. >> happy mother's day. >> yes >> to mother, happy birthday, if you're actually watching. >> which she always does guys, have a great weekend thank you. that does it for c"closing bell. "fast money" starts now. "fast money" starts now. looking over new york city's time's square. i'm melissa lee and tonight on "fast," a crypto crush, just when you thought it was safe to get in, the whole universe sinking. getting nervous, brian kelly says there are three things you need to know. plus the battle is heating up, snappinging back at the ex-founder of steve wynn