Ackman Pitches $65 Billion UMG Deal to Move Listing to US

Summary

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Bloomberg Intelligence Podcast Summary

Episode: Ackman Pitches $65 Billion UMG Deal to Move Listing to US
Date: April 7, 2026
Hosts: Paul Sweeney and Scarlet Fu

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Episode Overview

This episode dives deep into current Wall Street news and key investment themes with a focus on:

• Bill Ackman's bold $65 billion pitch for Universal Music Group (UMG) and a plan to move its listing to the US,
• The latest strategic shifts in AI and data center infrastructure,
• Big pharmaceutical M&A deals and innovations in healthcare,
• Macro industry trends connecting markets, technology, and global regulatory dynamics.

The show brings in expert analysis from Bloomberg Intelligence's top analysts, providing listeners with authoritative breakdowns and practical insights relevant to investors and industry watchers.

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Key Discussion Points & Insights

1. Bill Ackman’s Universal Music Group Play

[02:24–07:39]

• Background:
  Bill Ackman, the activist billionaire, proposes a $65B bid to acquire UMG and shift its listing from Amsterdam to the US in an effort to boost returns for his hedge fund's holding.

• Expert Analysis:

  • Matthew Bloxham (Senior Media & Tech Analyst) explains shareholder frustration:

    "The numbers it's been posting performance wise have been pretty, pretty decent, but the share price keeps going down... this is Bill Ackman, you know, expressing some public frustration about that kind of mismatch and trying to... propose a different future for Universal Music, but particularly kind of a more financially engineered future." (03:06)

  • Ackman's plan involves serious leverage:

    "...pushing leverage to two and a half times from one times, doing more buybacks, selling their stake in Spotify just to kind of really crystallize some of the value that is there." (03:52)

  • The $65B offer represents a "paper premium" mostly driven by aggressive 2026 earnings projections—not a substantial upfront cash payment.

    "Most of that cash is basically being funded by leveraging up the UMG balance sheet and by selling the Spotify stake." (04:16)

• Deal Realism & Rationale:

  • Ackman is seen more as trying to “shake things up” than launching a fully credible buyout.

  • A key factor depressing UMG’s valuation: the AI threat to the future of music and real artists.

    "The big fundamental risk... is AI and whether in the future we're going to be fans of real human artists." (04:55)

• Shareholder Dynamics:

  • Vincent Bolloré owns 18% and is a major factor; unlikely to sell at this level.
  • Complex crossholdings (Vivendi) make buyout politics tough.

• Listing Move – Why Shift to NYSE?

  • US-listed companies typically command higher multiples, potentially “magically” increasing UMG’s value.

    "By kind of shifting the listing from one jurisdiction to another, you magically create value by getting a lift in the multiple." (06:19)

• Peer Comparison:

  • Both UMG and Warner Music trade at ~17x earnings and are seen similarly by investors.

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2. Anthropic, AI, and the Data Center Boom

[10:51–16:54 | 30:27–34:51]

Anthropic’s Ascent and AI Market Shakeup

[10:51–16:54]

• Expansion of Tech Deals:

  • Anthropic, Broadcom, and Google announce a huge cloud compute collaboration.

  • Anthropic’s revenue rockets from $9B to $30B in four months, driven by coding agents for enterprise.

    "Anthropic's revenue has tripled from 9 billion to 30 billion in a span of four months."
    — Mandeep Singh, Tech Analyst (11:54)

• Product Strategy:

  • Anthropic doubled down on coding agents, rapidly acquiring over 1,000 enterprise clients with million-dollar contracts.

    "They've landed all these customers just for one tool, one product that they conceived in weeks..." (12:24)

• Market Leadership Dynamics:

  • Anthropic surpasses OpenAI in revenue run rate, despite being valued half as high.

  • Prognosis: Anthropic likely to narrow the valuation gap with OpenAI in upcoming fundraising rounds.

    "OpenAI raised money at $852 billion....Anthropic was valued at 380 billion. So...a company growing faster having surpassed OpenAI was valued at half..." (14:06)

• Enterprise Stickiness:

  • Anthropic’s focus on enterprise results in sticky, durable revenue streams versus OpenAI’s consumer focus.

    "...contracts are very sticky. Once you start using a product...you're not going to rip and replace." (15:51)

• Broader Beneficiaries:

  • Any company integrated with Anthropic (like Broadcom and Google on the chip side) stands to benefit.

Data Centers: Unstoppable Growth and Energy Challenges

[30:27–34:51]

• Data Center Buildout:

  • Accelerating construction is fueled by AI growth, with data centers driving demand for both clean and conventional energy sources.

    "We're seeing a huge amount of construction. We're seeing a huge amount of capacity being connected and that's continuing to accelerate."
    — Lloyd Arnold, BNEF Data Center Reporter (31:01)

• Local and Regulatory Pushback:

  • Communities and states are scrutinizing new builds, especially in the US, due to concerns on energy usage and prices.

    "Shifting community attitudes are a headwind...This is largely tied to power pricing." (32:08)

• Natural Gas Dependency:

  • Data centers increasingly use on-site generation for autonomy and to stabilize energy costs.
  • Over 70% of clean power purchase agreements in the US come from major tech companies’ data centers.

• US Leads the World:

  • The buildout remains primarily a US phenomenon, with over two-thirds of global construction in the Americas.

    "For now we are seeing increased projects globally. But this US concentration is really because the biggest players...are all American companies..." (34:51)

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3. Pharma M&A and Weight Loss Drug Wars

[19:50–26:58]

• Gilead’s $5B Oncology Bet:

  • Gilead’s acquisition of German biotech Tubulus boosts its cancer drug development pipeline, focusing on antibody-drug conjugates (ADCs).

    "This is a very interesting acquisition...It's in a space...that had been kind of thought of maybe China's taken over all of it. The ADC's...World..."
    — Sam Fazeli, Healthcare Analyst (20:48)

• Insights on Oncology Innovation:

  • Tubulus brings a promising new platform and drugs, countering China’s perceived dominance in ADCs.

• Weight Loss Drug Price Wars:

  • Novo Nordisk slashes high-dose Wegovy price to undercut Lilly’s ZepBound as oral versions launch and competition heats up.

  • However, net prices are shrouded in rebates and insurance arrangements.

    "A lot of the times we don't actually see the price that people are paying...list price...is much lower price, at least through the insurance." (22:53)

• US vs Global Demand:

  • High demand for weight loss drugs extends far beyond the US, with booming self-pay markets even in slower-regulatory environments like the UK.

• Baldness and Beyond – Lighthearted Interlude:

  • No breakthrough baldness drug akin to Wegovy’s effect on weight loss ("...if you're in the process of losing it, there are approved drugs. You can use it to fluff out the number, the follicles." [25:09]).

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4. China vs. West – Streamlining Clinical Trials

[25:37–26:58]

• US Regulatory Reform as Competitive Parity:

  • The US moves to streamline clinical trial bureaucracy, matching China’s swifter biotechnology development cycles.

    "It takes months if not a year...to start a first in human clinical trial...What China has been able to do is to really streamline that process. So it's so much cheaper to go over there."
    — Sam Fazeli (25:47)

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Notable Quotes & Memorable Moments

• On UMG’s Valuation Disconnect:

  “The numbers look good, the share price going down, what's going on?”
  — Matthew Bloxham [03:06]

• On AI’s Impact on Media Valuations:

  "...the big fundamental risk to Universal Music...is AI and whether in future we're going to be fans of real human artists."
  — Matthew Bloxham [04:55]

• On Anthropic’s Breakneck Growth:

  “Anthropic's revenue has tripled from 9 billion to 30 billion in a span of four months.”
  — Mandeep Singh [11:54]

• On Stickiness of Enterprise AI Deals:

  "Once you start using a product and it's a new product, new category, you're not going to rip and replace."
  — Mandeep Singh [15:51]

• On Regulatory Reform and US/China Competition:

  "This is not about risking people. This is about just getting rid of some bureaucracy and allowing companies to catch up with the way that trials are done in China."
  — Sam Fazeli [25:47]

• Lighthearted On Baldness Drug Innovation:

  "Once you've lost it, I think you just have to gracefully accept your fate."
  — Sam Fazeli [25:09]

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Timestamps for Key Segments

• Bill Ackman & UMG Analysis: 02:24–07:39
• Anthropic & AI Industry Expansion: 10:51–16:54
• Gilead/Tubulus M&A, Weight Loss Drugs: 19:50–26:58
• US/China Biotech Competition: 25:37–26:58
• Data Centers & Energy Demand: 30:27–34:51

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Tone & Style

The discussion is authoritative yet conversational, mixing deep-dive financial analysis with relatable, sometimes humorous asides. Experts break down complexities into investor-relevant insights, occasionally lightening the mood with banter and personal anecdotes.

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This summary distills the major threads of the episode, providing the essential context, opinions, and quotable moments for listeners who missed the show or want to revisit the highlights.

Transcript

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[Paul Sweeney]

I did not have Universal Music Group being put in play on my bingo card, but billionaire activist Bill ackman. I mean IPO'd that thing, bought it, sold it. I don't know why it's public. Billionaire activist Bill Ackman has proposed a bid for Universal Music Group to increase returns on one of his hedge fund's biggest holdings. Not really sure why, but our next guest does. Matthew BLOXHAM. Senior media and tech analyst for Bloomberg Intelligence, is usually based in London, but he's here in New York, which goes to my theory.

[Sponsor Voice]

Yes.

[Paul Sweeney]

That we're seeing a lot of London based bi people here, which means somebody's buying these people dinner. They're not coming over of their own.

[Co-host or Guest Host]

I think we should swap. I'll go to London for a while and do the show from there.

[Paul Sweeney]

Matthew, tell us what's going on here with United Music Group and kind of what Bill Ackman's thinking.

[Matthew Bloxham]

Yes, look, I think a lot of shareholders being frustrated for quite some time with the share price performance of Universal Music. The numbers it's been posting performance wise have been pretty, pretty decent, but the share price keeps going down. And I think, I mean, I've had a lot of incoming inquiries from clients over the last three or four months trying to kind of put this puzzle together. You know, the numbers look good, the share price going down, what's going on? And I think to some degree this is Bill Ackman, you know, expressing some public frustration about that kind of mismatch and trying to, I guess, propose, you know, a different future for Universal Music, but particularly kind of a more financially engineered future. So kind of sweating the balance sheet more, pushing leverage to two and a half times from, from one times, doing more buybacks, selling their stake in Spotify just to kind of really crystallize some of the value that is there.

[Co-host or Guest Host]

Now, from what I understand, this is sort of a complicated proposal they're putting together here that involves I guess a SPAC here in the US valuing the company, I guess at close to $65 billion. Is that truly a 78% premium?

[Matthew Bloxham]

It would be, but it's very much a kind of paper premium. So if you look at the numbers, basically what they've said is that on the 2026 earnings, they think Universal Music should trade at about 25 times earnings. It currently trades on about 17. And so they've applied that multiple to the earnings, creative, everything else out of that. So kind of really there's kind of nothing substantial there. It's not that there is an element of cash to the bid, but it's not very much. And most, most of that cash is basically being funded by leveraging up the UMG balance sheet and by selling the Spotify stake.

[Co-host or Guest Host]

Well then I wonder how real is this or is this just. Is he throwing it out there to shake things up or can this thing really happen?

[Matthew Bloxham]

I think he's throwing it out there to shake things up and I Think what we would expect to see from the company is perhaps, you know, kind of an acknowledgement that, you know, that there's more perhaps they could do to kind of crystallize the value and get it recognized in markets. But we'll see. I mean, obviously the big fundamental risk to Universal Music, which is keeping that earnings multiple down, is AI and whether in future we're going to be fans of real human artists.

[Co-host or Guest Host]

Say it isn't so.

[Paul Sweeney]

All right, we've got some big shareholders here. I'm going to go back to an old acquaintance of mine, Vincent Belore. What's he want to do with the Stock? He owns 18% of the stock here and I know there's always been concern and in this company and in other companies, he has holdings that he's a seller, he's a better seller here and that could keep a lid on this thing.

[Matthew Bloxham]

Yeah, that's certainly been a bit of an overhang. I'd be surprised at this level. He's a seller and obviously it's even more complicated than that because Vivendi owns a stake in it and he's the kind of most influential shareholder in Vivendi too. So yeah, you know, obviously I think he's probably playing a longer term game. Kind of wants to get value crystallization at some point, but he's not the kind of person to be pressurized into something that doesn't fit his agenda, whatever that is.

[Co-host or Guest Host]

He also Ackman says he wants to. He's very adamant about wanting to move the listing out of Amsterdam and move it here to the New York Stock Exchange. Why is that?

[Matthew Bloxham]

I think the principal reason is because typically companies get a higher multiple on earnings in the US than they do in Europe. And so to some degree it shouldn't really be this way. But by kind of shifting the listing from one jurisdiction to another, you magically create value by getting a lift in the multiple. As I said, I think the big pushback on that for me is the AI threat. You know, we've seen multiple contraction for lots of industries on the back of the perceived AI risk. And I think that's very much in play here for the record labels, particularly Universal.

[Paul Sweeney]

There's another publicly traded music company out there, Warner Music Group. And how did the two. What are the valuation differences between those two?

[Matthew Bloxham]

They're pretty. Say they both trade on about 17 times earnings. I think people see them very similarly. There's a much lower free float in Warner, you know, I think almost a kind of public private company. They both face similar risks. I think. Obviously for the last 10 years or so Universal has been by far and away the number one record label. It kind of dominates the kind of charts in terms of its artists. In recent times we have seen Warner kind of take some share, but it's kind of relatively gradual thing. But I think largely investors kind of see them both as, you know, a play on the same fundamentals.

[Listener or Junior Host]

Stay with us.

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[Paul Sweeney]

What's still happening despite all the uncertainty in the world is technology companies are doing deals. They are investing, investing in AI. Lot of stuff going on even today. So we asked Mandeep Singh to step in. Mandeep runs all the tech research for Bloomberg Intelligence and we appreciate getting a few minutes of his time. Mandeep, let's start with Anthropic, Broadcom, Google. They're expanding a strategic collaboration that will allow Anthropic access to about three and a half gigawatts worth of computing power starting in 2027. Talk to what's going on with Anthropic and Broadcom and Google.

[Mandeep Singh]

Yeah, I mean you remember the time when OpenAI signed all those deals for 10 gigawatt capacity?

[Paul Sweeney]

Yep.

[Mandeep Singh]

Well, things have changed. The momentum has shifted towards Anthropic in a big way. And now we see this deal, which really is a reflection of the momentum that Anthropic has generated from coding agents, from enterprise. In fact, Anthropic's revenue has tripled from 9 billion to 30 billion in a span of four months.

[Sam Fazeli]

What?

[Mandeep Singh]

This is breakneck growth that we have never seen at least until the time that I've covered this space and you know, now they are short of compute capacity so they're signing all these multi year deals to secure compute.

[Listener or Junior Host]

Okay, so this might be like a basic question for someone who follows AI so closely, but is this all because people want to use Claude, like Anthropic's Claude vs OpenAI's ChatGPT? I'm still using ChatGPT. I don't know if I'm very behind.

[Mandeep Singh]

Well, so it all comes down to use Case and what Anthropic decided Which in hindsight, and hindsight is just a weeks here, you know, seems to be a very smart move is really double down on coding agents as a use case. And this is really, you know, tools that developers use to complete their code, write full on code, you know, that can save them hours. And now Anthropic has got thousand enterprise customers that are paying over $1 million plus each in a span of weeks. They've landed all these customers just for one tool, one product that they conceived in weeks and they've been able to ramp that up so fast.

[Paul Sweeney]

So who are the peers for Anthropic? Again just remind me because I need my flowchart to remember who's who here. Who are the peers or who are the competitors for Anthropic?

[Mandeep Singh]

I mean on the coding side you can think of names like Atlassian, they used to manage code and coding agent is a new category. So when you think about an agentic AI that's solving code end to end. This is the use case that everyone was waiting when they were asking the ROI question. This is the ROI that you know they were looking for. And think of the capex for 2027 now, now that we have seen this revenue ramp from Anthropic, I bet you 2027 capex numbers are going to these companies coming public.

[Paul Sweeney]

When can we see them? Because I don't know who these people

[Mandeep Singh]

are in the back half of the year.

[Paul Sweeney]

And you know, Anthropic, you think maybe

[Mandeep Singh]

Anthropic for sure, for sure. I will be very surprised if they don this opportunity. ChatGPT is that OpenAI but OpenAI has got some trouble now. There was a point when OpenAI was the clear leader, they had the best growth. Well, Anthropic has actually surpassed OpenAI in terms of revenue run rate. Just to put it in context, OpenAI raised money at $852 billion in valuation. In the last private funding round Anthropica was valued at 380 billion. So imagine a company growing faster having surpassed OpenAI was valued at half the valuation of OpenAI. So I would be very curious to see what is the next funding round for Anthropic look like. And I think they should narrow the valuation gap that they have with OpenAI and then what?

[Listener or Junior Host]

So what does it mean for Broadcom? Because we're seeing that stock higher 3% today. But do they just Broadcom benefit from this, this long term Runway of.

[Mandeep Singh]

I mean clearly anything touching Anthropic ecosystem right now should do well, whether it's Broadcom, whether It's Google on the chip side. Google as a standalone chip company will have a sizable revenue from this Anthropic deal. And that's where, you know, Nvidia or anything touching OpenAI will probably see some headwind at least on the back of this news.

[Paul Sweeney]

How often does like and then how often does this technology evolve? How quickly does it evolve? Like if I buy a piece of software today or I'm not even sure what I'm buying. I'm not buying a piece of software. I'm buying some AI product.

[Mandeep Singh]

Yeah.

[Paul Sweeney]

How long is that relevant for before some new technology comes along and makes it irrelevant? I got to go buy something else.

[Mandeep Singh]

These companies are releasing new features every week. In fact, this coding agent product, as I said, was consumed in a matter of weeks. And so the next model release from OpenAI could be, you know, better than Anthropic. The problem that OpenAI may run into is enterprise. You know, contracts are very sticky. Once you start using a product and it's a new product, new category, you're not going to rip and replace. And that's where what Anthropic is doing with coding agents, it's going to be sticky revenue because companies are signing million dollar plus contracts now. They're not just going to go back and start using OpenAI if their next product is better. So this is sticky. And that's why I think Anthropic has created a new category. Whereas OpenAI was focused on the consumer side. They did really well with ChatGPT subscriptions, but they missed out on this opportunity in terms of focusing on coding agents and enterprise.

[Paul Sweeney]

Stay with us. More from Bloomberg Intelligence coming up. This

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[Podcast Announcer]

You're listening to the Bloomberg Intelligence Podcast. Catch us live weekdays at 10am Eastern on Apple CarPlay and Android Auto with the Bloomberg Business app Listen on demand. Wherever you get your podcasts or watch us live on YouTube, it's another day.

[Paul Sweeney]

Which means it's another M and a trade in the health care space. Juliet Sciences agrees to buy private German biotech Tubulus in a deal worth up to $5 billion to boost its portfolio in cancer drug development. Let's start there with Sam Fazeli. Covers all the health care stuff for Bloomberg Intelligence. He's based in London, lives in France, I think, but he's in New York. Go figure. Here today. So we got him in studio. Sam, what's Juliet doing here? What are they buying here and what's the strategy?

[Sam Fazeli]

Can I just say I'm so happy to be here. You know I love car. I know you so.

[Paul Sweeney]

And you love you. I mean the rest of Sommelier's love. When you walk through the door?

[Sam Fazeli]

My flight door opened at 16:50 last night.

[Paul Sweeney]

Yep.

[Sam Fazeli]

I was in the cab at 17:15. That is 25 minutes door to door to the cab. Where are all these TSA issues? I'm not belittling them. I know, but it didn't affect me.

[Listener or Junior Host]

So I'm happy because you were exiting the airport.

[Sam Fazeli]

I'm special.

[Listener or Junior Host]

Oh, you're also special.

[Co-host or Guest Host]

Right.

[Listener or Junior Host]

You rolled out a red cargo.

[Sam Fazeli]

What's Gilead doing? This is the second deal they've done in the past few months, couple of months I would say. They are continuing to build an increasingly oncology focused. They do have various assets, as you know, in HIV and oncology and they've been building this out. This is a very interesting acquisition, I have to say. It's a private German company. I've met them two or three times. Listen to their presentation. It's in a space, Paul, that had been kind of thought of maybe China's taken over all of it. The ADC's antibody drug conjugate World and that there isn't really much to play for here. So they built this company $401 million. The biggest European Series C ever announced about a few months ago. And now I'm going to come back to that and connect you all up in a space that you think China's overtaken the rest of world and Europe. And here comes Gilead buying it for a hefty price. Right. That 401 million. I don't know what the valuation was at that time but this is a good deal for the investors.

[Listener or Junior Host]

And what kind of treatments are they now going to be able to offer with this acquisition?

[Sam Fazeli]

Yeah, so Gilead already has a well known Trudeau ADC antibody. So what you do is that you put the drug that's a chemotherapy often that you want to avoid having the overall exposure in your body to an antibody that homes in on a tumor. That's the principle. Much harder than in reality to make work. So here what they're doing is buying a brand new at pretty broad profile platform and two drugs with it. So it's exactly in their wheelhouse.

[Paul Sweeney]

All right, let's move on to the weight loss stuff because that's always in the news. Novo Nordisk will price its new high dose Wegovy, which is what we use in the household at $3.99 a month for cash pay. Patients undercutting the cost of most doses of rival Eli Lilly Zepp Bound. Is this just another example where this market we're now moving on to really competing on price.

[Sam Fazeli]

Yeah. But they have been pulled for a while. And, you know, a lot of the times we don't actually see the price that people are paying because it goes to a different channel. The rebates, the discounts, you know, all that story of how everybody is so focused on the list price and where actually people are getting is the.

[Matthew Bloxham]

Is the.

[Sam Fazeli]

Is a much lower price, at least through the insurance. So it is not a surprise it's going to keep happening. Novo needs to get its footing back in here. And it's interesting that it's happening just the week after that. Lilly has been approved to launch their oral drug.

[Paul Sweeney]

Right. Wow.

[Sam Fazeli]

And that's the first week or two this Friday. We might see some of the prescriptions flow through. Everyone's focused on that. How strong a launch will that be?

[Paul Sweeney]

And that even though you have to take this pill daily, people take pills all the time. It's no big deal. That this is going to really open up the market is that.

[Sam Fazeli]

I mean, so the thing is that it doesn't give you as much weight loss as the jab. The jab is super powerful. Right. But so you could think about it in many different ways. I'll just add it to my box. You know, a lot of people have these boxes with their vitamins and minerals and all that. I just had it in there. Take it. It doesn't have any food restrictions or anything.

[Paul Sweeney]

Okay.

[Sam Fazeli]

So you get some side effects, but. And maybe you do it after you've done your major weight loss. So you've got your £3, £4, £10 that you wanted to lose and you're feeling great and you don't want to be taking the jab anymore. Although a lot of people are fine with the injection. It just helps. There are needle phobic people. It helps.

[Listener or Junior Host]

And what's the expectation for? Is the pill necessarily going to be

[Sam Fazeli]

cheaper than the job? Well, it should be for the patient. I don't think so. I think that would be a really odd thing for them to massively undercut. Massively. But I think you can play with pricing there, especially as it's got probably better margins than the injectable.

[Paul Sweeney]

I mean, is. Are these weight loss drugs as popular outside of the U.S. as they are in the U.S. absolutely.

[Sam Fazeli]

In the U.K. you know, we are a backward country sometimes when it comes to medicine. At least we try. Wait for two years before things get approved. There's a massive self pay market.

[Paul Sweeney]

All right, I have to ask. I'm asking for a friend here.

[Listener or Junior Host]

Okay.

[Paul Sweeney]

Is there a baldness Drug. Potentially.

[Sam Fazeli]

Yeah, yeah. But when you find one, can you let me know?

[Paul Sweeney]

I mean this is.

[Sam Fazeli]

There is already marketed drugs for it.

[Paul Sweeney]

But something that's as.

[Sam Fazeli]

Yeah.

[Paul Sweeney]

Effective as. Yeah, we go before.

[Co-host or Guest Host]

No.

[Sam Fazeli]

Once you've lost it, I think you just have to gracefully accept your fate if you're in the process of losing it. There are approved drugs. You can use it to fluff out the number, the follicles.

[Paul Sweeney]

But there's no, there's nothing in the pipeline that's just gonna. Because that would be big.

[Sam Fazeli]

Also don't forget that as we go up the evolutionary tree we don't really need hair. So perhaps it's evolution that's taking place here.

[Lloyd Arnold]

Right.

[Paul Sweeney]

Have you heard that?

[Listener or Junior Host]

That's a good perspective. I've never heard that.

[Sam Fazeli]

That's how I make myself feel better.

[Listener or Junior Host]

Good way to look at it. You mentioned China when, when you first came in. The FDA is trying to streamline clinical trials. What does that mean for how the US competes with China in health care?

[Sam Fazeli]

Desperately needed. Desperately needed. It takes months if not a year or so to start a first in human clinical trial. All for the right reasons. But a lot of it is red tape. So what China has been able to do is to really streamline that process. So it's so much cheaper to go over there. Imagine if you gain nine months or a year in your development plans and you can get an answer very much quicker. There's as patients are enrolled in your trials. So this is not about risking people. This is about just getting rid of some bureaucracy and allowing companies to catch up with the way that trials are done in China. You take away one more competitive advantage from China.

[Paul Sweeney]

Are all parties here in the US on board with this strategy? I mean the pharmaceutical companies, the insurers,

[Sam Fazeli]

the, the pharma companies would love it. Insurance, I don't think they, at that stage of a development of a drug, they don't care. They wait for the very end of it. But certainly the fda, this is the FDA talking about it now. Right? So we do need this, we need this to take away one more competitive advantage from or disadvantage in the U.S. 30 seconds.

[Paul Sweeney]

How, how should we think about the west versus China in terms of pharmaceuticals and biotechs and all that stuff?

[Sam Fazeli]

You need to constantly look over your shoulder. The research, the science, the capability is on par and rapidly rising. And there is a massive push by the government there because they can also have the luxury of being able to plan for 5, 10, 15 years.

[Paul Sweeney]

Stay with us. More from Bloomberg Intelligence coming up after this.

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[Paul Sweeney]

One thing that continues to move forward is AI investments in AI and that includes investments in data centers. That has just been a huge growth area. We hear about that from all different angles. Lloyd Arnold covers this. He's a BNEF data center reporter joining us here. Lloyd, I know you're out with a piece of work here. AI data center build advances at first full speed 5 things to know what are the 5 things to know about this rapid build out in data centers across across the world? Actually

[Lloyd Arnold]

first is we're seeing a huge amount of construction. We're seeing a huge amount of capacity being connected and that's continuing to accelerate. This is driving purchases of clean energy. It's also driving purchases of natural gas and thermal generation. This is help being driven by more and more capacity or more capital allocated by the big tech companies, by big datacenter developers. And we're expecting this to continue. There's confidence in newcomers to this space and the biggest AI companies have positive margins. So a lot of this demand is likely to be sustained.

[Co-host or Guest Host]

You know, Arnold, front page of the Wall Street Journal today has a write up about cities and states that are now taking direct aim at data centers, including states like Maine, Georgia. They're saying wait a minute, we need to do more studies on what the impact of these data centers are going to mean for communities and for the environment. How much is that going to be a hurdle for companies wanting to expand in the way they want to expand and at the level they want to expand?

[Lloyd Arnold]

Maine in particular, probably not a huge hurdle. Based on BNASS data, there are no construction projects in Maine and no planned data centers in Maine. More generally, shifting community attitudes are a headwind. This is largely tied to power pricing, which is part of what's driving some data center developers toward natural gas. BNF's tracking about 100 gigawatts of data center IT capacity associated with on site generation. That removes reliance on utilities and hopes to shield consumers from higher power prices.

[Paul Sweeney]

Lloyd I hear a lot of folks asking when is it going to be enough? Are we going to know when we have enough data center capacity? Because the question I think Some people started to ask is are we overbuilding here? How do we track that?

[Lloyd Arnold]

That's a really real question. It is an unknown. The things we're looking at are how are the AI companies performing? Are they continuing to get higher uptake, Are they continuing to get more users? And how are the Neo clouds performing? So these are companies such as Core Weave such as Nibius who are very, very exposed to AI workloads and developing data centers to serve them. While those companies continue to perform well, that's a strong sign. Demand is hot.

[Co-host or Guest Host]

And I must apologize Lloyd, I called you Arnold earlier. Did not mean to call you by your last name, but that's what happens Paul, Sometimes when people have last names that can be first names. I'm sure it's not the first time Lloyd, but sorry it had to be me. Talk to us about the connection between building of data centers and the energy markets because they need a whole lot of energy to make those data centers work.

[Lloyd Arnold]

Natural to Alexis actually happens a lot in terms of energy. Data centers are huge energy customers. That's a big part of why people are interested in data center build out. At present this means data center developers, big tech giants like Microsoft, Meta, Amazon and Google. These companies are hugely active in the clean power purchase agreement market. They made up over half of that market globally last year and over 70% in the U.S. so that's one really big impact. And then maybe the other story is this growing reliance on natural gas for data centers. For now that seems to be a U.S. story. But lots and lots of data center campuses are planning to be powered on site by gas engines and gas turbines.

[Paul Sweeney]

30 seconds left, Lloyd. Is this primarily a US story? Data center buildout or is it global?

[Lloyd Arnold]

This is primarily a US story. For now we are seeing increased projects globally. But this US concentration is really because the biggest players can these tech giants and the big AI labs creating new demand companies like OpenAI, Anthropic XAI, they're all American companies that's seeing a consolidation of a market already skewed to the US further into the US over 2/3 of construction pipeline we see is in the Americas. For now, longer term we're likely to see new demand in a lot of emerging markets.

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