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First Move with Julia Chatterley
U.S. Jobless Claims Above One Million Again; Kremlin Critic In Hospital After Suspected Poisoning; Kamala Harris Makes History As Vice Presidential Nominee. Aired 9-10a ET
Aired August 20, 2020 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:00:13]
JULIA CHATTERLEY, CNN BUSINESS ANCHOR: Live from New York, I'm Julia Chatterley. This is FIRST MOVE. Welcome to the show and I'm going to get
you straight with a look of what we're seeing on Wall Street this morning, because we are expecting a softer open, as you can see, down some three-
tenths of one percent across the board.
The NASDAQ and S&P 500 slipping further from record highs hit on Tuesday. That, despite a pretty juicy day for Apple investors. The tech giant
passing the milestone of a $2 trillion market cap yesterday, and -- wow, look at that chart, and there's IPO news, too.
Airbnb pushing ahead with their plans to go public. That, despite the COVID related challenges of course to its gig economy or sharing economy model.
And the crisis, of course, continues to weigh on America's jobs market, too. A further 1.1 million Americans filing fresh claims for jobless
benefits just in the last week, a worse than expected number. Claims back above the one million level again, after falling below that simply the week
before.
Not only that, of course, another, an almost 15 million people continuing to collect benefits, just another reminder of the stark disconnect between
Wall Street and Main Street. Record highs, of course, for stocks versus the real economic pain for ordinary Americans.
Fed Minutes out yesterday showing policymakers increasingly worried about the outlook, but of course, unable to decide when and how to launch new
support.
They've made it clear of course that Congress needs to do its part. Sadly, D.C. remains in a stimulus stalemate and it's now been three weeks since
millions of unemployed Americans lost their $600.00 a week enhanced benefit.
We will get to all of that in a moment, but first, I want to bring you some breaking news this morning, too.
Coming from Russian, opposition leader, Alexei Navalny, a prominent critic of the Kremlin is in the hospital in a serious condition. His spokeswoman
says Navalny was poisoned, the news coming just hours before Russia is set to announce further details regarding their coronavirus vaccine.
Matthew Chance is in Moscow covering both of these stories for us.
Matthew, let's start with Alexei Navalny, what do we know about the status of his health and what on Earth happened here?
MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, Julia, I mean, he is currently unconscious in an intensive care ward in the Siberian
city of Omsk where his plane was forced to make an emergency landing after he was taken ill on board en route back to Moscow from the Russian Far
East.
This absolutely horrific video, which you may have seen, and we may get to broadcast now are taken by a fellow passenger of medics coming onto the
plane and evacuating him to an ambulance.
You can hear his screams of agony there. He was obviously in a lot of distress, a lot of pain, and he was taken into the emergency hospital in
Omsk.
As you mentioned, his supporters, his lawyers, say this is a clear-cut case of poisoning, and they want a police investigation into the possibility
that that's what took place.
The doctors, though, at the hospital in Omsk where he is being treated and where he is in intensive care and where he's on a ventilator, aren't ready
yet to make that diagnosis.
Take a listen to what the deputy of the hospital had to say.
(BEGIN VIDEO CLIP)
ANATOLY KALINICHENKO, DEPUTY HEAD PHYSICIAN, OMSK HOSPITAL (through translator): I can report that the patient is in our hospital. He's in a
serious condition, on ventilator support, but he is stable.
Currently, there are multiple diagnoses which we are trying to eliminate or confirm or are still considering. Treatment and diagnostic procedures are
under way; laboratory research, consultations with the doctors of the related areas of professional interest in case conference, and so on.
Naturally, poisoning is considered as one of the possible reasons for the deterioration in the condition, but besides that, there could be a number
of acute states that lead to the same clinical signs.
We are working on everything to eliminate, confirm. Unfortunately, I cannot tell you more.
(END VIDEO CLIP)
CHANCE: All right, well, Julia, there's been some comment in the past few minutes from the Kremlin. They've acknowledged that Alexei Navalny is in a
serious condition. "And like to any citizen of our country," their spokesman said, "We wish him a speedy recovery."
The fact is though that Kremlin critics like Alexei Navalny, people who are outspoken in their criticism of this country's leadership and authorities,
have been silenced in the past with violence, sometimes using poison as well.
And so obviously, there's a great deal of concern, a great deal of speculation at the moment, this could be the latest instance in a long line
of violent attempts to silence Kremlin critics -- Julia.
[09:05:17]
CHATTERLEY: Yes, we don't know yet, but it's hard not to make the supposition given past history, Matthew. Thank you for that update there.
Matthew Chance from Moscow and we will get back with him shortly.
As I've mentioned, another big story in Russia today, of course, the coronavirus vaccine. We're expecting news on its development in less than
half an hour.
Later in the show, we'll also be speaking to the CEO of the Russian direct investment fund which has funded the vaccine. So we'll be with Matthew once
again in the show to get that latest on that.
But for now, let's bring it back to our business agenda.
As I mentioned already, another 1.1 million Americans filing new claims for jobless benefits last week, continued jobless claims. Those continuing to
get their hands-on benefits remains very high too at nearly 15 million people.
John Harwood is live in Washington. John, a stark reminder of the millions of people in America that need further support, and of course, we're in a
stimulus stalemate as far as those negotiations in Washington are concerned to get more support to them.
JOHN HARWOOD, CNN WHITE HOUSE CORRESPONDENT: Julia, just a reminder of how bad the economic situation we're in is that for more than 20 weeks, we have
had weekly initial jobless claims higher than in any week in the great recession.
So the fact that this has now trended up is a reflection of the resurgence of the virus this summer, just as there's a lag between coronavirus cases
and deaths. There's a lag between coronavirus cases and the reaction of the public, which has an impact on the economy.
Our economy has actually been going kind of sideways since June, and that is a warning that if the Congress and the administration do not get
together and pass additional fiscal relief, we are going to see deeper economic problems this fall and this is just an indication of that.
CHATTERLEY: ... roll out for support for small businesses, of course, too, which also need ongoing support in order to retain those workers.
John, we could talk about this for hours, but I do want to get your take on what we saw from day three last night from the Democratic National
Convention.
We heard from President Obama. We also heard from the Democrats' choice for Vice President, too, Kamala Harris. Let me give you a flavor.
(BEGIN VIDEO CLIP)
SEN. KAMALA HARRIS (D-CA), PRESUMPTIVE VICE-PRESIDENTIAL NOMINEE: Donald Trump's failure of leadership has cost lives and livelihoods.
We are a nation that is grieving, grieving the loss of life, the loss of jobs.
BARACK OBAMA, FORMER PRESIDENT OF THE UNITED STATES: For close to four years now, he has shown no interest in putting in the work. No interest in
finding common ground, no interest in using the awesome power of his office to help anyone, but himself and his friends.
No interest in treating the presidency as anything but one more reality show that he can use to get the attention he craves.
Donald Trump hasn't grown into the job because he can't.
(END VIDEO CLIP)
CHATTERLEY: John, I think we have to underscore to our international viewers just how unprecedented it is to see a full frontal assault, a
takedown by a former President of a sitting President on stage at the D.N.C. last night, and can we compare and contrast with the tone we get
from Joe Biden tonight, too?
HARWOOD: Well, it was an unprecedented attack by a former President on his successor, but remember, everything about President Trump, his behavior,
the way he has conducted himself in the office, is also unprecedented. So those two things weren't necessarily out of alignment.
Very striking sequence of attacks there. You had President Obama portraying President Trump, not going after his policy preferences, but portraying him
as an actual threat to democracy and imploring Americans to use the next 76 days to get out and vote and express their values.
Kamala Harris was a somewhat more traditional political speech. It was her most fulsome introduction onto the national stage, so you had her making
the case on coronavirus, lives and livelihoods. That's the core of the challenge facing the country right now, 170,000 people have lost their
lives and the economy, as we've been discussing, is a wreck.
I think Joe Biden tonight is going to try to make the case for how he can remedy these problems, how he can bring the country together, sort of an
echo of what Jill Biden did a couple of days ago when she talked about how she and Joe Biden, when they got married, had repaired a family that had
lost a mother and an infant and said, how do you make a family whole? The same way you make a nation whole.
[09:10:07]
HARWOOD: And I think Joe Biden is going to try to make that case tonight and demonstrate his personal values. He is well known for empathy and a
sense of decency and he is going to try to link that to what he can do, what he can bring to the country to get us out of the mess that we're in
right now.
CHATTERLEY: Yes, we've laid out the problems, now here are some solutions. John Harwood, thank you so much for that, as always.
Now, a fresh sign that the Chinese consumers are bouncing back and oh boy, are they spending online, at least, Alibaba quarterly results there topping
expectations. The company posted a net profit of $6.8 billion revenue coming in at more than $22 billion, up some 35 percent nearly on a year
ago.
Selina Wang is live in Hong Kong with all of the details for us. Selina, talks us through it because it wasn't just this where we saw bumper gains.
SELINA WANG, CNN CORRESPONDENT: Absolutely. I mean, Alibaba is often seen by investors as a barometer for broader consumer sentiment in China and
what we're seeing from this strong earnings is it is a reflection that China was one of the first economies to rebound from the pandemic with
those tight virus lockdowns, leading to largely that pandemic being controlled.
And on the earnings call, you even heard management saying that they are coming out of the pandemic even stronger than before.
During those lockdowns, people had no choice, but to spend online. Businesses, many more of them had to turn to selling online as well, and
Alibaba says, those trends are sticking. That's why you saw the core commerce business jumping by more than a third.
You also saw their Cloud computing business jump by almost 60 percent, bolstered by people working from home.
But the big question for Alibaba moving forward, even more than these geopolitical tensions, is can they maintain the strong market position they
have in its vast array of businesses? If you look at the e-commerce division, they are facing more competition than ever before from the likes
of Pinduoduo and Upstart as well as jd.com.
In its food delivery business, they have stiff competition from Meituan and in live streaming, ByteDance and Tencent are stepping up their gains, their
efforts to have more social media influence or sell more products through live streaming.
But again, Julia, all of these companies in the online retail sector, they are benefiting from this post-COVID rebound where people are continuing to
shift their spending behavior online.
CHATTERLEY: You raised so many great points there, but you did also flirt with the elephant in the room, which is the geopolitics here, and I do want
to talk about this because it's not just about Alibaba's business in China. Of course, they operate a marketplace for businesses here in the United
States to access the Chinese nation consumers as well.
So there's a number of elements when you're talking about the potential threat from this administration to their operations. What did Alibaba have
to say about that?
WANG: Julia, yes, a very large potential elephant in the room. Alibaba's management did say they were watching the situation very closely, that is
fluid, and they would of course comply with any potential changes in U.S. government policies towards Chinese companies.
And we are expecting the rhetoric, at least, from the Trump administration to only get worse as we edge up in to those November elections.
But really any potential ban on Alibaba would likely have a minimal impact on its revenue. The vast majority of its sales comes from its domestic
China business, but the big question on a potential ban, which is the same question that investors are asking for the ban on Tencent's WeChat, is how
broad the scope of any potential ban could be.
You have companies like Apple and Nike, they get a significant amount of their sales to the Chinese consumer from Alibaba's TMall platform. Analysts
have also noted that Alibaba's Cloud computing business relies on chips and software from U.S. companies. So that could have a big impact on Alibaba.
I do also want to point out, Julia, that Trump has had an interesting relationship with billionaire, Alibaba founder, Jack Ma. Trump has even
called him a friend of his.
And if you remember, in 2017, Jack Ma made a very high-profile meeting with Trump, after which he said he was going to create one million jobs in
America. Although Jack Ma later walked back that promise after what he said was rising U.S.-China tensions.
Thus far, we have seen Alibaba stay out of the cross hairs of this assault we're seeing from D.C. towards Chinese companies, but we did get that
comment from Trump over the weekend hinting that we could see potential bans on companies, including Alibaba.
CHATTERLEY: Yes, those friendships are strongest when they're useful. Actually, there were some comments from the current CEO actually that stood
out to me.
He couldn't have been more pointed, "Alibaba's primary commercial focus in the United States is to support American brands, retailers, SMEs and
farmers to sell to consumers and trade partners in China and key markets around the world. Our mission, to make it easy to do business anywhere, is
fully aligned with the interests of both China and the United States."
We shall see. Selina Wang, thank you so much for that.
[09:15:12]
CHATTERLEY: All right, there are some other stories I want to bring to you now that are making headlines around the world.
The brother of the Manchester suicide bomber who set off an explosion that killed 22 people more than three years ago has been sentenced to more than
50 years in prison.
The 23-year-old, Hashem Abedi was sentenced a short time ago for his involvement in the attack, but he refused to attend the hearing. Abedi was
found guilty of murder, attempted murder and conspiring to cause explosions.
Hot weather, dry conditions and lightning strikes have all contributed to dozens of major wildfires raging across California. More than 130,000
hectares have been were burned.
The governor is now ordering thousands of people to leave their homes for their own safety.
He says resources to fight the flames are stretched thin and thousands of buildings remain under threat.
Belarus is broadening its crackdown on dissidence opening a criminal investigating into opposition council that rejected Alexander Lukashenko's
reelection.
The President has ordered police to clear the streets, but protesters are defying the ban. They're encouraged by supporters from the E.U. which have
declared the election invalid.
A blistering heat wave is crippling Japan with temperatures reaching dangerous levels across the nation. In the past few weeks, more than 130
people have died in Tokyo, that's the highest monthly number in a decade. Authorities have issued a heat stroke warning and they are even encouraging
people to remove their masks in certain situations.
All right, still to come here on FIRST MOVE, we're expecting an announcement from Russia on its COVID-19 vaccine at half past the hour.
Its fast-track approval left experts hungry for details on how it works and just how it was tested. Stay with us. That's to come.
(COMMERCIAL BREAK)
CHATTERLEY: Welcome back to FIRST MOVE, live from New York. U.S. futures are lower amid some discouraging news for the U.S. economy this morning.
Fresh numbers showing over one million Americans filing for first-time jobless benefits last week, in total now more than 28 million Americans
still getting some form of jobless assistance and still no further help from Washington, D.C. in sight.
In the meantime, a new reading on the Philadelphia area, factory activity has fallen for a second straight month.
Meanwhile, U.S.-China relations continue to play into sentiment, too. The U.S. ha officially suspended its Extradition Treaty with Hong Kong, the
latest move by Washington to punish China for the sweeping new Hong Kong security law.
On a positive note, however, China announcing a short time ago that trade talks with the U.S. are set to resume after last weekend's delay. It's like
a game of ping-pong.
Joining us now, Mohamed El-Erian, the Chief Economic Adviser at Allianz. Sir, Mohamed, great to have you on the show. Hopefully you can make sense
of all of this for me.
The recovery in the data I think took people by surprise, but now it's slowing and we don't have an agreement from D.C. on more stimulus. How
concerned are you?
MOHAMED EL-ERIAN, CHIEF ECONOMIC ADVISER, ALLIANZ: I'm very concerned, Julia. Thank you for having me on.
I'm very concerned because it is way too early for economic activity to level off and start coming down again. That's what the data are telling us.
This recovery is not a V-shaped recovery, it looks more like a lopsided square root. You come down sharply, come back a little bit and then you
level off. That's not what this country needs and that's not what the global economy needs.
CHATTERLEY: It's clearly a concern for the Federal Reserve, too. We saw that in the Minutes yesterday. They've proved incredibly potent, we'll call
it that, at stabilizing financial markets and the stock market I think reflects that.
But getting the money, getting the support to the real economy here is a far greater challenge.
EL-ERIAN: Absolutely, like you say, the Federal Reserve has done a great deal to stabilize the market and that may have been a necessary condition,
but it's certainly not sufficient for the rest of the economy.
And even the one facility that is aimed at Main Street as opposed to Wall Street and that's the Main Street lending facility is having enormous
difficulty.
So we have a problem both within the monetary policy targeting, and of course beyond that in terms of fiscal policy and other relief and
productivity enhancing measures.
CHATTERLEY: So we've got a shortage and a sort of an early pullback on the financial aid measures. We've got the ongoing health crisis.
Something I've also seen you talk about in the last few days and I think is so important is the impact that has on our behavior, and what that means
for the economy, too.
EL-ERIAN: Yes, we have three emergencies, two that we talk a lot about, the third one that we don't enough. The first one is the health emergency, and
we're understanding better what it is and how to deal with it and it will take time.
The second one is an economic emergency, and how do we live with reopening and COVID-19 at the same time.
But there's a third one that's really critical, which is behavioral modification, and what is shocking to a lot of people, and particularly in
the United States, is that people haven't changed their behaviors enough.
They don't understand that their own assessment of risk has an impact on the risk facing the community, and you saw that with the closing of the
universities. Individuals acting in a way that ends up undermining the collective wellbeing.
So what we really need is a better alignment of risk and that's going to take, unfortunately, longer than we have in terms of keeping the economy
going.
CHATTERLEY: And until we see that and we see rising cases in an ongoing pandemic and the situation feeling out of control, you effectively have to
buy the recovery if you're a lawmaker in this country.
EL-ERIAN: Correct, and every time you buy the economy, you risk a couple of things. One is doing it in an inefficient manner. You either do too little
or too much. It's really hard to strike the right balance. And B, we're mortgaging our future.
We're trying desperately to borrow from our future for just relief, when we should be beyond relief at this stage. We should be looking forward, making
sure that we can live with COVID better and starting to address the medium- term scars of this economy.
What drives me crazy, Julia, and it's not just me, is this is not about engineering. This is about political leadership and will.
CHATTERLEY: Yes, I couldn't agree more with you. Dangerous to go further into that territory without showing degrees of rage, quite frankly.
What does this mean for investors, Mohamed, because people are asking whether what we are seeing in the stock market is sustainable?
We've got political risk coming up. We've got all of the risks that you just mentioned, too. What should investors be doing?
[09:25:19]
EL-ERIAN: Let alone the geopolitical risks that you just mentioned.
CHATTERLEY: Yes.
EL-ERIAN: The tensions between the U.S. and China have gone way beyond economics, so, it's much harder to put the genie back into the bottle.
Look, for the marketplace, only one thing has mattered, which is liquidity conditioning -- the belief that no matter what happens elsewhere, there
will be ample and reliable liquidity, and that is what us market observers call the technicals, the willingness of people to take enormous risks, even
though the fundamentals don't justify that risk.
So we have this very, very deep conditioning in liquidity and it's like a wave. You can ride it for quite a long time, it feels wonderful if you're
surfing it, but at some point it breaks. And predicting that point is hard.
But it's going to take a major shock to break that conditioning that whatever we do, Wall Street will be disconnected from Main Street because
the Central Banks are simply injecting liquidity on a reliable basis.
CHATTERLEY: What is that shock, Mohamed? Just so people watching are aware, they know what to look for.
EL-ERIAN: So, the one thing Central Banks cannot protect investors from is bankruptcy, capital impairment, because that destroys your capital.
So the one big risk I would look at is at what point do things on Main Street become so bad that there's a spike in bankruptcies? So far, we've
had some increase in bankruptcy, but no spike.
I think that is what breaks the back of this liquidity rally. So keep an eye on bankruptcies, because, remember, the Fed's liquidity can correct a
lot of mistakes, but it cannot correct a capital impairment mistake.
CHATTERLEY: Yes, it can keep lots of zombie companies going, but when you start to see the dominos fall, then there's a problem.
Mohamed El-Erian, fantastic to get your wisdom as always. Chief Economic Adviser for Allianz. Great to have you with us, sir.
All right, coming up, breaking news as Russia announces new details on its coronavirus vaccine. That's next. Stay with us.
(COMMERCIAL BREAK)
[09:30:38]
ANNOUNCER: This is CNN breaking news.
CHATTERLEY: Breaking news on Russia's COVID-19 vaccine. Moscow has announced plans to put the drug through a large-scale trial, which means
meeting international Phase 3 clinical standards.
The trial will involve 40,000 people across five different countries. Russia also elaborated on the vaccine's safety, arguing that Sputnik 5 uses
a human adenovirus delivery system that has been internationally approved for other vaccines.
Matthew Chance is in Moscow with further details. Two critical elements here, Matthew, the fact that we now are seemingly going to see a Phase 3
trial as we understand it; but, too, the specific type of vaccine that they're using here, the platform.
CHANCE: Yes, I mean, look, we were always promised by the Russians that Phase 3 trials would be held, and that's indeed what they have now
announced, that it would consist of 40,000 people and be held to international standards. It may mean Russia and also other countries like
Saudi Arabia, United Arab Emirates, the Philippines, possibly India, possibly Brazil. They are not specific on that, but possibly one or both of
those two countries.
And so that was something that was expected. What was unusual about this vaccine is that it was approved before those Phase 3 trials were actually
completed, and what the Russians say is that this isn't a Phase 3 trial, it's a post-registration trial because they've already registered it.
They've already approved it effectively.
They're already, apparently, starting the process of giving frontline healthcare workers, teachers, other vulnerable groups this vaccine, before
it's undergone the conventional number and extent of human trials.
So that's raised all sorts of concerns about whether the vaccine is effective, first of all, and of course whether it is safe. A question
normally answered by Phase 3 trials, and of course won't be fully answered in the Russian context until those trials are over.
In terms of the platform, the adenovirus platform the Russians have used, they've been spelling this out from the outset. This is a technology
they've developed. They say they've developed other vaccines in the past, the vaccine against Ebola, which has been certified by the World Health
Organization.
They also said they had in the works a vaccine against MERS, the Middle East Respiratory Syndrome, which hasn't finished. But it's on that
technology, the Russians say, that they've based this Sputnik V vaccine, the Sputnik vaccine against the coronavirus, and that's why they say they
can do it so quickly and that's why they say they're so confident that it's going to be safe, because it's technology they've already used in the past.
What we haven't seen yet are any published data to be peer reviewed. Now, the Russians have said today that they intend to publish that data later
this month, with only 10 days left in the month, and so I think scientists around the world are going to be anxious to see what they put out there --
Julia.
CHATTERLEY: Yes, where is the data? Because in order to validate any of the findings and even justifying going to Phase 3, we need to see some
evidence.
Matthew Chance, thank you so much for that.
Let's get some context here. Joining us now is Dr. Peter Hotez. He is Professor and Dean of Tropical Medicine at the Baylor College of Medicine.
Dr. Hotez, fantastic to have you on the show this morning. I know you were just listening to Matthew speaking there. Yes, it seems good that we're
going to see a Phase 3, as we would understand it here in the United States or elsewhere in the world, but to that point that we were making about the
data, don't we also need to understand Phase 1 and Phase 2 and the justification for even getting this far?
DR. PETER HOTEZ, DEAN OF THE SCHOOL OF TROPICAL MEDICINE, BAYLOR COLLEGE OF MEDICINE: That's right, Julia. They're putting the cart before the horse.
They say they've already approved it, now probably because they're succumbing to international pressure, now they say they're going to do a
Phase 3 trial of sorts.
Look, the situation is this: making a COVID-19 vaccine it turns out is not that technically complicated. This is an old-school problem in virology, we
need to make an immune response against the spike protein. There are many ways to do that.
Where our vaccine is through a recombinant, protein vaccine, that we are accelerating production in India. There are inactivated virus vaccines,
adenovirus vaccines like the AstraZeneca-Oxford and J&J, and now, the Russian vaccines.
That's not the hard part. The hard part is all the quality control, the quality assurance and the testing to show that it's safe and effective.
[09:35:20]
HOTEZ: So what the Russians are doing is really advertising their weakness, they're advertising that their science infrastructure is not strong. What
do I mean by that?
What I mean is it's not a technically complicated hurdle. The fact that they are calling it Sputnik V is ridiculous. It is nothing nearly as
complicated as that.
And they show their lack of situational awareness about the importance of quality control, quality assurance. This, to me, makes Russian science, as
I say, look weak and look like they're disorganized and not really certain of what they're really doing at this point.
CHATTERLEY: Wow. I mean that's some bold criticism there. There's an assumption of trust, it seems, coming from the Russians. But their
pushback, I think, and Matthew touched upon it as well, was that look, this is a platform that's been used on humans in the past.
Yet if you look at what some of the vaccine candidates in the United States, the technology that they're using, the mRNA, the messenger RNA,
which effectively fools the body into thinking you have the virus, this technology, this platform has never been used on humans. Do they have a
point here about what they're using versus what other candidates are based upon?
HOTEZ: Well, yes, you're right, there is an mRNA technology platform being looked at in the United States, but also several countries are looking at
adenovirus based vaccines like the Russians are doing.
So the Russians are proposing to develop an adenovirus vaccine. The Chinese have done the same, but the Chinese at least have published all of their
Phase 1 studies and they are publishing their non-human primate data, same with the AstraZeneca-Oxford vaccine. That's an adenovirus vaccine. They are
now publishing their studies.
J&J has an adenovirus vaccine. So, as I say, there are lots of different ways to make COVID-19 vaccines, the key is doing this in a stepwise manner
where the scientific community can review the literature, review the progress, because there are safety issues around these adenovirus vaccines.
They're not that straightforward, as we are already seeing in some of the Phase 1 trials.
They are actually as immunogenic sometimes as we would like in terms of stimulating an immune response that we saw in the AstraZeneca-Oxford
vaccine that a single dose is not very impressive. In inducing an immune response, you need at least two doses and probably that will be true with
the J&J vaccine.
So these are the things that need to be worked out, so with the Russians, by jumping all over all of those things, are tone deaf to the fact of what
the hard part of making a vaccine is, and that's why I made that very strong statement of condemnation that this is an advertisement for Russian
weakness in science, not strength.
CHATTERLEY: Yes, and I won't forget it. How do they remove that advert for their weakness? What do you need to hear them promise today and then
deliver on in order to convince you that this is a vaccine that's safe to use on humans and for mass use?
HOTEZ: Well, we do have lots of belts and suspenders to safeguard against actions like this and this is the World Health Organization that has spent
decades creating a system of pre-qualification before you start releasing and exporting vaccines.
Again, the Russians have jumped over that as well and it smells like an old-fashioned Cold War tactic of gaining influence over African countries
and certain Latin American countries such as Venezuela, maybe Nicaragua, and Cuba in order to exert influence.
So in my opinion, they've gone out of the way to botch this in every way they can to lose credibility.
CHATTERLEY: So, to your point now, and I think it's an important one, we want to hear confirmation from the UAE, the Saudis, Brazil or India that
have been mentioned by the Russians today that they are willing to have these trials done and what the conditions are, quite frankly, on the sale
of this vaccine if the decision is that they decide to use it.
HOTEZ: Well, not exactly. What I want Julia, what I want is, I want to hear this from the World Health Organization. I want to hear from the W.H.O.
that the Russians are adhering to the same international standards that everybody else is adhering to, including us, including the other
pharmaceutical companies, including the Chinese.
It's really important that the Russians fall in line. And it's not meant as a disciplinary action. You know, the consequences are dire if the Russians
mess it up and get it wrong, because we have a huge problem with vaccine hesitancy and vaccine confidence globally.
There is a global anti-vaccine moment waiting for just such an opportunity to discredit vaccines. This has already resulted in that large-scale
vaccine refusal in the Philippines that caused a deadly measles epidemic and killed many children in the Philippines.
This is true in Samoa. This has been true in the United States where the anti-vaccine movement is very aggressive and landed 18 kids in the ICU with
measles because of the undermining of confidence.
And this is why the scientific community is drawing a line in the sand on this, because the consequences of getting it wrong and undermining vaccine
confidence.
Vaccines are the most life-saving technologies we have. They are our best line of defense against childhood infections and infectious diseases in
general, and if we screw around with this and undermine that confidence, then this has devastating consequences for global health.
[09:40:48]
CHATTERLEY: Yes, I read a review this morning that said there's some form of anti-vaccination sentiment in 90 percent of countries around the world,
giving that sentiment ammunition is the last thing we need during a global pandemic.
HOTEZ: They are in global movement now, unfortunately.
CHATTERLEY: Yes, I know. Dr. Peter Hotez, fantastic to have you on the show. Sir, thank you. Professor and Dean of Tropical Medicine at the Baylor
College of Medicine. Sir, thank you.
HOTEZ: Thanks.
CHATTERLEY: All right, just a quick look at the action on Wall Street this morning because we have opened lower across Wall Street as you can see.
The S&P falling further from record highs. The NASDAQ, though, unchanged. Energy stocks, in fact, the big losers so far.
All of this amid new concerns about the health of the U.S. economy and the outlook. The number of people filing first-time jobless claims rising by a
further 1.1 million last week. We were expecting a reading below. We were hoping for it, we didn't get it.
All right, coming up next, we'll be speaking to the CEO of the Russian fund that's financed the vaccine development. We'll get the details from Russia
right next, don't move a muscle. Stay with us.
(COMMERCIAL BREAK)
CHATTERLEY: All right, let's return to one of our top stories today. Russia has announced the latest update on its COVID-19 vaccine. The country taking
a different approach to others around the world also developing their own.
[09:45:07]
CHATTERLEY: Russia says 40,000 people will now take part in what it calls a post-registration clinical trial, the equivalent of Phase 3 trials that
others, for example, Moderna in the United States or Oxford University in the U.K. have begun.
Unlike those vaccines, Russia has already registered its vaccine and is using it. It says further tests will take place mostly in Russia, but also
in the UAE, Saudi Arabia, the Philippines and either India or Brazil.
I'm pleased to say, Kirill Dmitriev, the CEO of the Russian Direct Investment Fund which has funded the vaccine is joining us now from Moscow.
Kirill, fantastic to have you on the show. A hugely important moment for Russia. I know you were listening to my previous conversation. Dr. Hotez
there called you an advertisement for your weakness. What is your response? What is the message today?
KIRILL DMITRIEV, CEO, RUSSIAN DIRECT INVESTMENT FUND: Well, Julia, we just finished a call with 300 journalists from 50 countries and the most
impressions that people from different countries have is an impression of hope and positivity.
And we hear some very negative comments from the U.S., from some of the people in Britain, and frankly, we can only explain it by shock.
You know, when there is shock there are four stages of it. It is denial, anger, depression and acceptance, and I think there is this angry phase
because nobody could believe that Russia would really be advanced on its vaccine research, but we are.
There is some valid criticism about publishing data and it will be published this month. There is also post-registration trials that we will
do based on placebo, based on randomization in accordance with western standards.
But there is a main point that our platform of vaccine human adenovirus is really proven and I can maybe go into some details if that's of interest.
CHATTERLEY: We shall. But let's talk about the point that you made about the valid criticism and the publishing of data. Precisely what data are you
going to publish? Because there's still uncertainty about what justified your decision to take this on to Phase 3 and even be already using this on
humans. Will you publish the equivalent of Phase 1 and Phase 2 data?
DMITRIEV: Yes, so most Phase 1 and Phase 2 data will be published. There was extensive research on animals before, and I think a very important
point is the adenovirus human vaccines have been used for a very long time.
Even U.S. Military uses it for all of the conscripts starting from 1971. So 10 million U.S. Military, more than that, have received adenovirus human
vaccines in the past.
So what Russian scientists did is they chose a well-documented, very well- proven platform. There had been 250 clinical studies of human adenovirus and there were 30,000 patients receiving the adenovirus human vector drug
in China, more than 20,000 clinical trials of people in the last 10 years on human adenovirus and they made a bet on this approach.
And it's very different from what the mRNA and monkey adenovirus is because we know there are no long-term negative effects of human adenovirus, which
we are using. But nobody has studied long-term effects of mRNA, monkey adenovirus. There are just no studies long term of those long-term effects.
CHATTERLEY: And that's a valid point. How many humans have you trialed your vaccine on, this vaccine, for COVID-19 on so far? Can you give me a number?
DMITRIEV: Well, the platform in Russia has been tried on more than 3,000 people. The same delivery mechanism.
CHATTERLEY: Not the platform, Kirill, this specific vaccine. I understand your point about the platform, and you've made it, but this specific COVID-
19 vaccine. How many people are we talking about?
DMITRIEV: To be specific, the vaccine has been tried on more than a hundred people and the approach has been that, because of the pandemic, Russia has
a law that if you have a very well-documented proven platform, you can start post-registration trials while you vaccinate your more at-risk
people.
And we believe this is actually a very good approach and many other countries are asking us about this law, about the thoughts behind it,
because basically, we want to vaccinate volunteer medical workers, other people who want to get the vaccine, while we do post-registration trials on
the vaccine platform that has been proven before.
We know it doesn't cause cancer, we know it doesn't cause infertility, which are still open questions for mRNA and monkey adenovirus vaccines, and
Julia, on those vaccines, Phase 3 doesn't answer those long-term questions because those new technologies haven't been studied, haven't been
researched for long-term effects.
CHATTERLEY: I understand, but I think -- and you've made the point about the shock from the international community. You are simply jumping steps
that other nations like the United States, like the U.K. simply wouldn't do, and we can debate whether it's right or wrong during a global pandemic,
but it's simply not done by other nations.
Kirill, talk to me about the agreements you have with the likes of Saudi Arabia, with the UAE. Are they formal agreements to begin these trials, and
if so, when will they begin?
[09:50:08]
DMITRIEV: Yes, so we expect clinical trials to start in some countries in August, and some in September.
We have formal agreements with several Middle Eastern nations, and once again, we are not jumping any steps. We follow Russian law and Russian law
allows us to basically, at the time of pandemics to use a proven platform.
So once again, we have major interest from India, from Latin America, from countries in Asia. We are not trying to put a label on it, but asking a
very basic question, how does the technology work?
And once they get the answer for example that we used adenovirus vectors number 5 and 26 and Johnson & Johnson uses just 26 and CanSino uses just 5,
and we have both. So understand, we have a very solid technology that is also validated by others players, CanSino has already approved for use in
the Chinese military.
So once you understand how it works, actually it becomes very clear that choosing a proven platform makes lots of sense. This is why we have great
progress with Middle East, with Latin America, with Asia.
CHATTERLEY: There's clearly huge fears out there that getting this wrong fuels the concern about taking vaccines in the first place. Kirill, it's a
personal question, but I'm going to ask you, would you be willing at this stage to take the vaccine that the Russians have produced?
DMITRIEV: Julia, I already took the vaccine. My wife took the vaccine. My two 74-year-old parents took the vaccine who are molecular biologists and
immunologist.
We took the vaccine because we know it works and, you know, we know the science behind it. So yes, I did take it. My antibody level is several
times of a COVID patient who has been very sick. No really significant side effects.
I've been vaccinated for the last two months. I feel great, I walk around, and I feel liberated from all those constraints that were imposed on us
before.
CHATTERLEY: Kirill, fantastic to have you on the show. Thank you so much for sharing that personal information, as well as what the country is
doing, and we look forward to that data, sir. I think everybody does. Thank you.
DMITRIEV: Enjoy.
CHATTERLEY: Kirill Dmitriev, the CEO of the Russian Direct Investment Fund. Thank you.
All right, breaking news now, too. Former White House chief strategist, Steve Bannon, arrested. U.S. Federal prosecutors have charged Bannon and
three others with defrauding donors of hundreds of thousands of dollars in a border wall fundraising campaign.
Bannon will now appear in a New York court later today.
You're watching FIRST MOVE. More to come.
(COMMERCIAL BREAK)
CHATTERLEY: Welcome back to FIRST MOVE with a final look at what we're seeing for the price action this morning, and we are lower.
Tech stocks have been on the rebound though in the past few moments. Two tenths of a percent higher, so we won't hold our breaths on that one, but
it has seen an impact, of course, as a result of the disappointing jobless claims weighing on sentiment, a further one million people claiming for
benefits.
All right, a look at today's Boardroom Brief as well, Airbnb moving ahead with its long anticipated IPO. It has just filed confidential documents
with the SEC.
The home sharing service is aiming to go public despite the challenges that the coronavirus pandemic poses to the sharing economy model.
[09:55:19]
CHATTERLEY: Facebook meanwhile says it is cracking down on accounts that promotes the QAnon conspiracy theory. It says it's removed nearly 800
groups from its site and has put restrictions on 2,000 groups on Facebook and more than 10,000 accounts on Instagram.
Facebook says it is part of a broader expansion of its policy against violence.
Australian carrier, Qantas Airways says it is unlikely it will resume international flights before July 2021. The airline reported a nearly $2
billion loss for the financial year that ended in June as it suffered heavy losses due to the coronavirus pandemic.
All right, that's it for the show. We'll continue to cover the breaking news on the vaccine and of course Alexie Navalny out of Russia throughout
programming today.
But for now, that's it for FIRST MOVE. I'm Julia Chatterley. We'll see you tomorrow. Stay safe.
(COMMERCIAL BREAK)
[10:00:00]
END
