All posts by Michelle Grathers

About Michelle Grathers

Michelle Grathers is an international tax expert. She has consulted for a variety of firms and high net worth individuals on all tax- and legal-related issues. She also helps new companies develop payroll services, statutory audits and mergers and acquisitions. Contact Michelle at michelle[at]businessdistrict.com

California is on Track to Produce Affordable Insulin

Companies, Health Care, Health Tech, News

Drug company Covica Rx has contracted with the state of California to create affordable insulin. Pending FDA approval, this 10-year, $50 million agreement will allow Civica to start making CalRx insulin in late 2023.  

People with Type 1 diabetes do not produce enough insulin, and they rely on manufactured insulin in order to survive. Currently, insulin can cost up to $300 for a 10 milliliter vial. But insulin produced by Civica for the state of California will cost no more than $30 per 10 milliliter vial, even for the uninsured. This will save patients who pay out of pocket up to $4,000 a year. 

This arrangement is part of California’s CalRx initiative which aims to reduce the cost of medications by producing generic drugs under the state’s own label. 

Civica will be producing three types of insulin, glargine, lisprom and aspart, which will all be the equivalent of the insulin produced by the major drug companies. Although California has initiated this project, the medicines will be available all across the country.

The production of affordable insulin is a game changer for Americans with diabetes. NPR.com reported that 1 out of 6 Americans living with diabetes ration their supply of insulin due to the high cost of the drug. University of California College of Law professor Robin Feldman called this an “extraordinary move in the pharmaceutical industry, not just for insulin but potentially for all kinds of drugs.”

Several pharmaceutical companies such as Eli Lilly and Sanofi have announced that they will also be cutting the cost of insulin in the upcoming year.

McDonald’s Opens Automated Test Restaurant

Companies, Technology, , ,

In today’s exciting world of advanced technology, we are constantly being introduced to new concepts and developments. As innovative thought is far-reaching into all fields, it is no surprise that the food industry is also coming out with progressive ideas and designs.

McDonald’s, one of the world’s most profitable franchises, has set off on a new endeavor. The fast-food chain has opened its first flagship automated restaurant aimed at eating on the go. The goal is to minimize the amount of human presence, and to use robots or machinery where possible.

At the new Texas location near Fort Worth, customers can either pre-order on the app or make their selections at a kiosk inside. While there are some staff members in the kitchen to prepare the meals, there is no need to employ workers to man the register or hand out the orders. A robot distributes the orders at the pick-up counter or drive-thru window. The physical restaurant is significantly smaller than most McDonald’s chains, as it is designed primarily for takeout orders.

According to franchisee Keith Vanecek, “The technology in this restaurant not only allows us to serve our customers in new, innovative ways, it gives our restaurant team the ability to concentrate more on order speed and accuracy, which makes the experience more enjoyable for everyone.”

While some have applauded the potential improvements to the ordering process, others have expressed concern about the number of layoffs that the shift to automated systems will inevitably cause. Only time will tell if this new system is efficient, and how it impacts the amount of manpower needed.

Transitioning to Lab-Made Diamonds

Consumerism, Environment, Millenials, Mining, , ,

The weather is warming up and the sun is finally shining. As engagement season approaches, there is generally a rise in sales in the diamond industry. With the increasing popularity of factory-made diamonds, however, authentic diamond sales have been slowing down.

Independent diamond industry analyst, Edahn Golan, explains that the number of engagement rings with a lab-made diamond sold in March increased by 63% compared to last year, while the amount of traditional engagement rings featuring a natural diamond decreased by 25%. Data from February showed an even larger increase in purchases of rings with manufactured diamonds, at 80% more than the previous year. Golan cautions, “The big fear in the natural diamonds industry is that consumers will start accepting lab-grown diamonds in engagement rings.” He continues, “Too late. It’s actually happening.”

Why the switch to man-made diamonds?

The most apparent reason is cost. With a one-carat round lab-made diamond retailing at $2,318, it’s equivalent natural stone would average at $8.740 – a difference of over 70%. This disparity enables couples to purchase larger stones without worry about compromising on clarify or perfection.

Aside from cost, manufactured diamonds are becoming more popular as the population learns more about them. Negative association connected to child labor in African diamond mines and “blood diamonds” used to finance conflict in war-torn areas leaves a bad taste to many. According to The Knot wedding planning website, the younger population is more conscientious about the background of natural diamonds and the ethical issues related. A lab-made diamond offers an appealing solution.

Large jewelry companies are accommodating these new concerns and the market trends. Zales and Kay Jewelers are producing more man-made bridal options. Pandora, the world’s largest jewelry company, made a drastic move last year, announcing the company’s plans to stop using natural diamonds altogether, and shift to manufactured diamonds only.

If the statistics from the past few months are telling, it seems that demand for manufactured diamonds will only continue to increase. As long as budget and ethics remain priorities for consumers, more jewelry companies are bound to follow the path some major ones have already taken.

Eighteen More Oil Rigs Bodes Well for Oil Economy

Economy, , , , , ,

U.S. offshore natural gas production wells in the Gulf of Mexico and Southern California.

With the addition of two new oil rigs operating in the Gulf of Mexico 16 new ones across the US, there are now a total of 653 drilling for oil and gas.

It is good news for the oil industry, but those numbers are far below the number of rigs operating in 2014 and 2015. According to numbers released last week by the Houston-based oilfield-services company Baker-Hughes, this year’s number is lower by 47 since last year, and is still 65 percent lower than the 1,882 which were pumping out oil and gas at the end of 2014.

Of the 653 rigs working today, 129 are looking for natural gas and the remainder, 523, are bringing out oil.

The oil industry has been suffering as an oil glut continues to keep prices of oil low. Caused by a growing trend of drilling in US shale fields, combined with increased oil production by OPEC, the oil glut brought oil prices to half, and lower, than their mid-2014 high of $115 per barrel.

Lower oil prices froze exploration for new sources of oil and natural gas, and many people in the industry were laid off. The fact that the US rig count has been growing and now is higher than its been since January, could be a harbinger of better times for the industry.

Larger Women Growing as a Fashion Market Force

Consumerism, News, , , ,

Armed with the knowledge that larger women control a large and growing chunk of the fashion sector pie, clothing retailers are beginning to understand how to lure this market and boost sales.

The first step is perhaps surprising: to eliminate the so-called “Plus-size” section of the women’s clothing department and mainstream sizes 16 and above into the center of the sales floor.

Meijer Inc, a Michigan-based retailer, has already made the switch in 15 of its 230 stores, placing the extended sizes on the same racks as the “straight sizes.” Their goal is to have the plus size section fully integrated into the straight sizes department in all of their stores by early 2017. The result will be that the majority of their fashion offerings will come in all sizes; from small to XXXL.

“We really felt all customers should have the exact same experience at Meijer,” said Annette Repasch, vice president of Softlines. “Not only by style, but by price and by location.”

Repasch added that until now the fast majority of plus-size fashion was conservative, and being relegated to the back of the store made the shopping experience less enjoyable for this sector of consumers.

The plus-size consumer is a growing segment of the market, according to a new study conducted by International Journal of Fashion Design, Technology and Education. They found that the the average American woman wears a size 16-18, up from a size 14 not too long ago. The NPD Group says that spending on plus-size clothing will reach and estimated $20.4 billion this year. That is an increase of 17 percent from 2013 and is outpacing the overall US apparel market by twice. The NPD Group also estimates that the percentage of teens purchasing plus-size clothing will reach 34 percent. In 2012 that number was 19 percent.