Executive Business Briefing

March 5, 2003 at 3:45 PM
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Here is a look at more of Wednesday's top business stories:

Calif. ISPs call on regulators to stop new SBC fees

SAN FRANCISCO, March 5 (UPI) -- The California Internet Service Providers Association warned Wednesday that an upcoming vote by the California Public Utilities Commission could among other things bankrupt dozens of Internet service providers.

The association said the measure favored by SBC Communications Inc. would also raise Internet rates for consumers and expose rural and other suburban consumers too much higher Internet bills.

The CPUC is scheduled to vote on Thursday on an interconnection agreement between SBC and Pac-West Telecomm that would allow the phone giant to charge competitors new per-minute and per-mile fees.

In this case, the $40 million in "transport charges" would approximate one-third of Pac-West's annual revenue, a move that would further restrict Internet access, especially for those rural users with the fewest alternatives.

A neutral Administrative Law judge issued a draft decision striking down the new proposed fees, but they were re-inserted in a recent "alternate" introduced by a commissioner.

"We urge the California PUC to 'stay the course,' uphold the findings of its neutral judge and bring a dose of badly needed regulatory certainty to the Internet sector," said Mike Jackman, CISPA's executive director.

SBC officials were not immediately available for comment.

Based in San Antonio, SBC Communications is a holding company whose subsidiaries provide wireline and wireless telecommunications services and equipment, directory advertising, electronic security services and cable television services.

For the fiscal year ended Dec. 31, 2002, total revenues at SBC fell 6 percent to $43.14 billion. Net income before extraordinary item and accounting change rose 6 percent to $7.47 billion.

Penn. settles lawsuit with Pfizer Inc.

HARRISBURG, Pa., March 5 (UPI) -- Attorney General Mike Fisher announced Wednesday a $49 million, multi-state settlement with Pfizer Inc. The settlement involves Pennsylvania and 46 other states, plus the District of Columbia.

The suit accused Pfizer of failing to pay mandated drug rebates to the states' Medicaid programs for Lipitor, an anti-cholesterol medication.

As part of the settlement, Pennsylvania will recover $1.5 million in fees and penalties.

"The company knowingly misreported and underpaid its Medicaid rebates for Lipitor," Fisher said. "By failing to disclose and properly report these discounts, the company violated its Medicaid Rebate Agreement and held onto rebate funds that should have been returned to each state's Medicaid Rebate Program."

The federal Medicaid drug rebate statute requires all pharmaceutical manufacturers that supply products to Medicaid programs to offer the Centers for Medicare and Medicaid Services the lowest price or "best price" for each medication purchased from the manufacturer.

Aerospace employment hits 50-year low

WASHINGTON, March 5 (UPI) -- The nation's aerospace employment has reached its lowest level in 50 years, an industry trade group said Wednesday.

Based on data from the U.S. Department of Labor's Bureau of Labor Statistics, the Aerospace Industries Association found at the end of 2002 there were 689,000 people employed in the industry.

"The figure should serve as a call to action for a national plan to revitalize the aerospace workforce," said John W. Douglass, AIA's president and chief executive officer.

Aerospace employment has dropped 106,000, or 13 percent, since the Sept. 11, 2001 terrorist attacks, and by nearly half, or 642,000 since December 1989, a period that marks the end of the Cold War.

"The workforce crisis facing the industry is accelerating," he said, "and the trend must be reversed before the future health of the industry is jeopardized."

Douglass said the decline is the result of several factors, including the financial crisis in civil aviation and commercial space business, industry mergers and acquisitions and the Sept. 11 attacks.

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