GSK and J&J lead rivals in drug access for poor

LONDON (Reuters) – Drugmakers – led by GlaxoSmithKline and Johnson & Johnson – are stepping up efforts to ensure their medicines are available and affordable in poor countries, after being attacked in the past for not doing enough.

The Access to Medicines Index, which tracks the actions of the top 20 drugmakers, showed on Wednesday there had been an improvement across the board in the past two years, reflecting both commercial self-interest and a concern for reputation.

Still, the nonprofit group behind the index took companies to task for not being more open about the widespread outsourcing of clinical trials in overseas countries, where many studies are handled by contract research organizations (CROs).

The analysis found no company was fully transparent about all the CROs it used, and only four – Merck & Co, Sanofi, GlaxoSmithKline and Eisai – provided evidence of enforcing codes of conduct to ensure CRO trials met safety and ethical standards.

Companies are increasingly conducting clinical trials in eastern Europe, Asia and Latin America, where costs are often lower and patients easier to recruit.

LOW COST, HIGH VOLUME

With emerging markets now a top priority for pharmaceutical companies worldwide, as sales in Western nations slow, firms are experimenting with a wide variety of low-cost, high-volume models to boost business.

As a result, Wim Leereveld, founder of the Amsterdam-based Access to Medicine Foundation, said companies were becoming much more organized internally in addressing the needs of low-income markets.

More companies are now adopting “tiered” pricing, with prices in poor countries sometimes reduced by 50 to 75 percent, although this varies considerably between companies, products and markets.

Britain’s GlaxoSmithKline came top in the 2012 index, based on an assessment of performance across a range of activities, such as drug donation, patent policy, pricing and research.

Johnson & Johnson was second and Sanofi third, while Japanese drugmakers came bottom of the table.

Significantly, two of the top six companies were mid-sized businesses – the HIV/AIDS specialist Gilead Sciences and diabetes care group Novo Nordisk – reflecting the importance of less-developed countries in both these diseases.

It is the third time the index has been compiled. GSK also led the board in previous rankings in 2008 and 2010.

BOARDROOM ATTENTION

The pharmaceutical industry has often had a stormy relationship with healthcare activists and some governments, leading to a bruising battle a decade ago with South Africa over AIDS drugs patents and access.

Since then, companies have come under increasing pressure to do things differently and make their products more affordable.

“The key is that the boards of these companies understand it is an important issue … in getting them access to markets and maintaining a good reputation with governments,” said David Sampson, author of the latest report.

The 2012 analysis found that the issue was now a board-level matter for more than 60 percent of companies, leading to novel approaches, such as GSK’s recently established developing countries and market access unit.

(Editing by Hans-Juergen Peters)

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Obama promotes tax agenda, Congress in stand-off

WASHINGTON (Reuters) – President Barack Obama on Tuesday launched a public relations push for his bid to raise taxes on wealthy Americans, but U.S. lawmakers remained deadlocked over dramatic, year-end tax increases and spending cuts known as the “fiscal cliff.”

At the White House, small business leaders emerged from a one-hour meeting with Obama to voice support for his goal of extending low tax rates for the middle class beyond the end of the year, while letting rates rise for wealthier taxpayers.

The business owners urged Obama “to fight to keep the middle class tax cuts,” said Lew Prince, co-founder of Vintage Vinyl, an independent music store in St. Louis, Mo.

“What grows jobs in America is consumers spending money, and the average person needs that two or three thousand dollars a year in his pocket to help drive the economy,” Prince told reporters at a news conference outside the White House.

Republicans want to extend low tax rates – enacted a decade ago under the administration of former Republican President George W. Bush – for all taxpayers, including households earning more than $ 250,000 a year.

Raising tax rates on the wealthy would discourage investment and hiring at a time of high unemployment, Republicans say.

Congressional Democrats allied with the president showed no signs of backing down from his stance on raising taxes for the wealthy. But both sides have softened on some long-held positions: Republicans have been showing a willingness to consider new revenue increases while Democrats have relaxed their hard line against new savings to the Medicare and Medicaid healthcare programs.

With just a month left before the Bush tax cuts expire and automatic spending cuts begin to take hold, markets were anxious about predictions that falling off the “fiscal cliff” could trigger another recession.

“There remains no clarity on the ultimate status on the Bush tax cuts, which have to be resolved before you can move forward with the remainder of the fiscal cliff,” said Chris Krueger, an analyst at Guggenheim Securities’ Washington Research Group.

MARKETS DOWN MODESTLY

Stock prices declined modestly despite government reports that planned U.S. business spending rose again in October and that single-family home prices rose again in September.

Despite a mild sell-off in stocks, the Dow Jones industrial average closed at about 12,878, up 14 percent from a year ago.

Brian Gardner, an analyst at financial firm Keefe Bruyette & Woods, said a limited deal would likely be struck to avert the fiscal cliff, with larger fiscal issues pushed into 2013.

“Fiscal cliff headlines could have the biggest impact on the market,” he said. “Over the coming weeks, we expect many headlines that will raise and then dash investors’ hopes … The next three weeks could be a bumpy ride.”

Fresh from his November 6 re-election, Obama was set to hold another meeting with business executives from larger companies on Wednesday and then to travel to a toy factory in Pennsylvania on Friday to press his case on taxes.

Senate Republican leader Mitch McConnell ripped into Obama for planning to take his agenda to the public. “Rather than sitting down with lawmakers of both parties and working out an agreement, he’s back out on the campaign trail,” McConnell roared on the Senate floor.

“We already know the president is a very good campaigner. What we don’t know is whether he has the leadership qualities necessary to lead his party to a bipartisan agreement.”

Obama last met with congressional leaders on November 16. A follow-up session was not expected this week, but could come next week, congressional aides said.

In the interim, little progress was made over the holidays in meetings between the staffs of the White House and Republican Speaker of the House of Representatives John Boehner, aides said.

LEADERS CANVAS RANKS

Ron Bonjean, a former aide to Republican leaders in the House and Senate, said leaders were still checking with their rank-and-file to gauge what concessions they might be able to stomach. In a week or so, Bonjean said, “the level of intensity will go up” with more meetings.

Senate Democratic leader Harry Reid said he was disappointed there has been “little progress” on a deal to avoid the “fiscal cliff” and warned that “we only have a couple weeks to get something done.

Despite frustration, Reid said he was optimistic lawmakers would avoid plunging off the “cliff,” a convergence of an estimated $ 600 billion in tax increases and spending cuts. “I’m extremely hopeful, and I do not believe that the Republicans are going to allow us to go over the cliff,” he said.

While Republicans have not shifted from their opposition to tax rate increases, a few have publicly disavowed a no-new-taxes pledge to which most of them have adhered for years, putting tax revenues, if not higher rates, on the negotiating table.

Also on Tuesday, Dick Durbin, a senior Senate Democrat and close Obama ally, urged fellow liberals to consider reforming the costly Medicare and Medicaid healthcare programs, signaling possible Democratic compromise in an area where they have steadfastly resisted change.

“Progressives should be willing to talk about ways to ensure the long-term viability of Medicare and Medicaid” for the elderly and poor, Durbin said in excerpts from a speech.

But he added that Medicare and Medicaid should not be part of the current negotiations on averting the fiscal cliff. On that front, Durbin stood firmly with Obama, urging extension of middle class tax cuts for 98 percent of Americans.

(Additional reporting by Thomas Ferraro, Kim Dixon, Patricia Zengerle, Lucia Mutikani and Mark Felsenthal, with Adam Kerlin in New York. Writing by Kevin Drawbaugh. Editing by Karey Wutkowski, Jackie Frank and Vicki Allen)

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Rugby-England add flyhalf Burns to squad for All Blacks’ test

LONDON, Nov 27 (Reuters) – England called up uncapped Gloucester flyhalf Freddie Burns on Tuesday to their squad for Saturday’s test against New Zealand in place of the injured Toby Flood.

Flood sustained ligament damage to a big toe during the 16-15 loss to South Africa at Twickenham last Saturday.

Owen Farrell, whose last start was in the first test in South Africa this year, is set to replace Flood in the starting XV against the world champions.

Lock Courtney Lawes, who missed England’s first three tests of the November series because of a knee injury, has also been included in the 23-man squad. Two other locks, Mouritz Botha and Tom Palmer, have been omitted.

After beating Fiji in their opening match, England have lost to Australia and the Springboks and now face a daunting match against the All Blacks who are unbeaten in 20 tests since the start of their victorious World Cup campaign last year.

“For those in Saturday’s squad the message is clear – last week we went toe to toe with the second best team in the world and felt we should have won,” England head coach Stuart Lancaster said in a statement.

“Now we have a chance to take on the number one side in front of a passionate Twickenham crowd, who have been fantastic throughout the Internationals, and it is a challenge we will meet head on.” (Reporting by John Mehaffey; Editing by Ken Ferris)

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Nintendo Unveils Wii Mini for the Canucks

Nintendo‘s pushing the new $ 299 Wii U console hard (and has already sold 400K units in the process), but in at least one region, the gaming company has a new back-up plan: The $ 99 Nintendo Wii Mini.

[More from Mashable: Wii U Sells 400,000 Units in First Week]

The new smaller, black box with red trim is a simpler game console. It offers no Internet access and cannot play older GameCube console games. What it does do is play virtually all Wii games (Nintendo says there are around 1,300 of them). The other major caveat is that the console is only available in Canada. According to a Nintendo press release on the new system, “Wii Mini is available exclusively in Canada during the holiday season. No information is available about its potential availability in other territories in the future.”

Nintendo also left out some details on the console itself. We do not know the exact size or weight of the box, though judging from the above image, it’s not much wider than a Wii Remote.

[More from Mashable: Meet the Super Fan Who Waited in Line for a Month for a Wii U [VIDEO]]

As Nintendo describes it, the Wii Mini is “all about games,” and without the Internet, it has to be. No Web browsing, cavorting with other Mii’s or multi-player gaming. It’s also worth noting that while the Wii Mini ships with a single Wii Remote Plus and Nunchuk (both red), a brand new Black Wii with Wii Sports and Wii Sports Resort (including Remote and Nunchuk) is currently $ 119 at Best Buy.

What do you think of the Wii Mini? Would you game without the Internet? Is this the perfect gift for young, Canadian children? Let us know in the comments.

GamePad

The Wii U GamePad has a 6.2-inch touchscreen.

Click here to view this gallery.

This story originally published on Mashable here.

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Berry’s ex says he was threatened before fight

LOS ANGELES (AP) — Halle Berry‘s ex-boyfriend claims the actress’s fiance threatened to kill him during a Thanksgiving confrontation that left him with a broken rib, bruised face and under arrest.

Gabriel Aubry‘s claims are included in court filings that led a judge Monday to grant a restraining order against actor Olivier Martinez, who is engaged to the Oscar-winning actress.

Aubry, 37, was arrested on suspicion of misdemeanor battery after his confrontation with Martinez on Thursday, but he states in the civil court filings that he was not the aggressor and that he was threatened and attacked without provocation. Martinez told police that Aubry had attacked first, the filings state.

A representative for Martinez could not be immediately reached for comment.

Aubry’s filing claims Martinez threatened him the day before the fight at an event at his daughter’s school that he and the actors attended. Aubry, a model, has a 4-year-old daughter with Berry and the former couple have been engaged in a lengthy custody battle.

The proceedings have been confidential, but Aubry states a major aspect of the case was Berry’s wish to move to Paris and take her daughter with her. The request was denied Nov. 9, Berry’s court filings state, and Aubry shares joint custody of the young girl.

Aubry claims Martinez told him, “You cost us $ 3 million,” while he was punched and kicked him in the driveway of Berry’s home. Aubry had gone to the home to allow his daughter to spend Thanksgiving with her mother, the filings state. Aubry claims Martinez threatened to kill him if Aubry didn’t move to Paris.

Berry was not in the driveway during the confrontation and neither was their daughter, the documents state.

Photos of Aubry’s face with cuts and a black eye were included in his court filing.

A judge set a hearing for Dec. 17 to consider whether a three-year restraining order should be granted. Aubry has a Dec. 13 court date for the possible battery case, which has not yet been filed by prosecutors.

___

Anthony McCartney can be reached at http://twitter.com/mccartneyAP .

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Fox News Suddenly Loves Illegal Immigrants

Since the election, there’s been a noticeable change in how Fox News has been covering the delicate issue of illegal immigration. It started with Sean Hannity. On his radio program on Nov. 8, Hannity told listeners that he now supports a path to citizenship for some people living in the U.S. illegally. “We’ve got to get rid of the immigration issue altogether,” Hannity said. “You control the border first. You create a pathway for those people that are here; you don’t say you’ve got to go. And that is a position I’ve evolved on.”

If the “I’ve evolved” language sounds familiar, it’s because that’s what President Obama said when he told the public in May that he’d changed his mind and was now supporting gay marriage. “I’ve evolved” is the way people in Washington signal that they realize they’re out of touch and are now trying to lead from behind.

For Hannity it’s a dramatic about-face. During the 2012 primary election, the GOP was the party of “self-deportation,” a term Mitt Romney coined. Romney was drawing on earlier comments by Hannity, who has called deportation the only solution for the 11 million-plus people living in the country illegally. Hannity described the Dream Act, which offers an opportunity of citizenship to young people who came to the U.S. before they were 16, finished high school, and have no criminal record, “an amnesty nightmare.” In his view at the time, even those illegal immigrants who served in the military didn’t deserve citizenship rights.

The day after Hannity announced his change of heart, Fox (NWSA) ran this news segment:

The following week, Fox provided extensive and generally positive coverage of Florida Senator Marco Rubio’s speech at the Washington Ideas Forum. Rubio appealed to his party to come up with a sensible plan for the illegal aliens living in the U.S., saying, “It’s really hard to get people to listen to you on economic growth, on tax rates, on health care if they think you want to deport your grandmother.”

Appearing on Fox on Sunday, Arizona Senator John McCain added to the chorus. He called on the GOP to heed the lessons of the election, in which minorities provided the margin of victory for Obama in key states. “I think we have to have a bigger tent,” McCain said. “Obviously, we have to do immigration reform.”

McCain has a keen interest in keeping the discussion alive: Back in 2007, he and Senator Ted Kennedy brought an immigration-reform package to Congress. That bill, which was pushed by President George W. Bush and included a path to citizenship, was derailed in part by talking heads such as Hannity. Any attempts by McCain & Co. to get traction for a renewed effort at immigration reform would benefit from a friendly reception on Fox News. It looks like they’ve got it.

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Dog days in Cuba: from shih tzus to schnauzers

HAVANA (AP) — The Cuban capital has played host to political summits and art festivals, ballet tributes and international baseball competitions. Now dog lovers are getting their chance to take center stage.

Hundreds of people from all over Cuba and several other countries came to a scruffy field near Revolution Plaza this past week to preen and fuss over the shih tzus, beagles, schnauzers and cocker spaniels that are the annual Fall Canine Expo’s star attractions. There were even about a dozen bichon habaneros, a mid-sized dog bred on the island since the 17th century.

As dog lovers talked shop, the merely curious strolled the field, checking out the more than 50 breeds on display while carefully dodging the prodigious output of so many dogs.

The four-day competition, which ended Sunday, included competitions in several breeding categories, and judges were flown in from Nicaragua, Colombia and Mexico.

“This is a small, poor country, but Cubans love dogs,” said Miguel Calvo, the president of Cuba’s dog federation, which organized the show. “We make a great effort to breed purebred animals of quality.”

Winners don’t receive any trophy or prize money, but that doesn’t mean the competition is any less fierce.

Anabel Perez, owner of a cocker spaniel named Lisamineli after the U.S. actress, spent more than half an hour coifing the dog’s hair in preparation for the competition, while the owner of a shih tzu named Tiguer meticulously brushed his coat nearby.

“I’m a hairdresser for humans,” explained Tiguer’s owner, Miguel Lopez. “So it’s easy for me. I like shih tzus because they are a lot of work to keep well groomed.”

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$1,499 Gaming Laptop is Ready for Steam on Linux

Alternative, Linux-based operating systems like Ubuntu haven’t historically carried much weight with PC gamers. Very few PC games have been made for Linux, over the years, ever since the company that was porting AAA gaming titles to Linux (Loki Games) went bankrupt in 2001. And while it’s possible to use a “compatibility layer” such as Wine to run Windows PC games in Linux, the results are mixed at best and require a lot of technical tweaking, sometimes even in between updates.

Colorado-based indie PC hardware company System76, however, clearly expects that not only are there PC gamers on Linux out there, but that some of them are willing to pay $ 1,499 for a tricked-out gaming laptop — the 17.3-inch Bonobo Extreme. Like all of System76′s machines, it runs the Ubuntu flavor of Linux; and its actual price tag is $ 1,599, but it’s gotten a $ 100 discount for the holidays.

Is it ahead of its time, like the Loki Games ports? Or has the time come for a new age of Linux gaming? For whatever reason, Valve — the creators of the Steam social gaming service — seems to think the latter.

​The hardware

The 17.3-inch screen is full 1080p, with a 1920×1080 resolution. Pretty much every spec starts out at “high end” and maxes out at “over the top”; it comes standard with an Intel Core i7 processor, 8 GB of RAM and a 500 GB, 7200 RPM hard drive, with a second drive bay and the option to swap the DVD burner out for a third storage disk. All three have the option of going up to a 512 GB Crucial solid state disk, or a 480 GB Intel SSD.

Gaming graphics are powered by an nVidia GeForce GTX 670MX, with 3 GB of memory. An extra $ 340 will get you a GTX 680M with 4 GB of memory. All told, with every possible hardware upgrade the Bonobo Extreme maxes out at an “extreme” $ 4,333 … and the Alienware-style, multicolored light-up keyboard is included for free.

​But what about the games?

Valve’s Linux Steam client is currently in beta, with another 5,000 testers added over the Thanksgiving holiday. About two dozen games are already available for purchase, including Valve’s free-to-play multiplayer online shooter Team Fortress 2 and a selection of games from previous Humble Indie Bundles.

The HIB previously became famous not just for having nearly all of its games support Linux, but for posting public sales figures online, and showing that a good-sized chunk of each bundle’s sales were for Linux gamers. Efforts such as this helped to convince Valve that supporting Linux would be worthwhile … and also seem to have reached someone at System76.

Jared Spurbeck is an open-source software enthusiast, who uses an Android phone and an Ubuntu laptop PC. He has been writing about technology and electronics since 2008.
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Vampires foil Tooth Fairy, Santa to claim box office win

(Reuters) – Teen vampire film “The Twilight Saga: Breaking Dawn – Part 2″ continued to take a bite out of the domestic box office, drawing $ 64 million in ticket sales over the five-day Thanksgiving holiday weekend to finish ahead of James Bond film “Skyfall.”

After opening with a massive $ 141.1 million last weekend, the finale of the “Twilight” franchise brought in a holiday swarm of fans to see teen favorites Robert Pattinson, Kristen Stewart and Taylor Lautner, pushing “Breaking Dawn” to $ 227 million in total domestic ticket sales.

“Skyfall,” starring Daniel Craig in the 23rd installment of the James Bond franchise, finished second, collecting $ 51 million in weekend ticket sales in the United States and Canada, according to studio estimates compiled by the box office division of Hollywood.com.

“Lincoln,” Steven Spielberg’s historical film on the last days of President Abraham Lincoln, grabbed third with $ 34.1 million over the Wednesday-through-Sunday period.

Making its debut in fourth place with $ 32.6 million was the animated film “Rise of the Guardians,” featuring the voices of Chris Pine and Alec Baldwin as the Tooth Fairy, Santa Claus and other childhood favorites who save the world.

“Life of Pi,” based on Yann Martel’s 2001 best-seller about a boy who survives on a raft with a tiger after his ship sinks, collected $ 30.15 million for a strong fifth-place finish.

“Rise of the Guardians,” produced by Dreamworks Animation for roughly $ 145 million, had been projected by distributor Paramount Pictures to gross $ 35 million in its first five days, according to Box Office Mojo.

Based on “The Guardians of Childhood” book series by children’s author William Joyce, the film will be the last Paramount will release for Dreamworks, whose films will be distributed next year by News Corp’s Fox studio.

Anne Globe, Dreamworks’ chief marketing officer, pointed to “the great parent reactions we’ve seen” to the film, and noting it was among the few choices for families through the end of year, said the studio was “hoping for very long legs through the holidays.”

The Ang Li film “Life of Pi,” on the other hand, performed stronger than expected. “We clearly exceeded our pre-release expectations,” said Chris Aronson, president of domestic distribution for 20th Century Fox.

“We’re seeing word of mouth in action, and a remarkably balanced demographic,” including strong ticket sales among those under 25, he said, adding “Many felt it was impossible to film, but Ang Li pulled it off.”

The remake of the 1984 Cold War film “Red Dawn,” finished seventh with $ 22 million in sales, behind animated feature “Wreck It Ralph”‘s $ 23 million take.

“Red Dawn” arrived at movie theaters four years after it was shot by MGM, but was delayed when the studio filed for bankruptcy in 2010. Last year, MGM decided to digitally alter the villains in the movie, inserting North Koreans instead of Chinese, after Hollywood began courting Chinese companies to help finance its films.

Propelled by the vampires, secret agents, presidents and nursery school favorites, Hollywood ticket sales totaled $ 290 million for the holiday weekend, beating the holiday weekend high mark of $ 273 million recorded in 2009. Hollywood studios often release their biggest holiday films on Wednesday to take advantage of school breaks the day before Thanksgiving.

The continued rush of fans to see teen favorites Pattinson, Stewart and Lautner pushed the “Twilight” installment to $ 227 million in total domestic ticket sales, making it the year’s sixth-largest, according to figures compiled by Box Office Mojo.

“Skyfall” with $ 221.7 million is just behind at number seven, while the year’s box office champ remains “Marvel’s The Avengers,” which has taken in $ 623 million to date.

(Reporting By Ronald Grover)

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Catalan election weakens bid for independence from Spain

BARCELONA, Spain (Reuters) – Separatists in Spain’s Catalonia won regional elections on Sunday but failed to get the resounding mandate they need to push convincingly for a referendum on independence.

Catalan President Artur Mas, who has implemented unpopular spending cuts in an economic crisis, had called an early election to test support for his new drive for independence for Catalonia, a wealthy region in northeastern Spain.

Voters handed almost two thirds of the 135-seat local parliament to four different Catalan separatist parties that all want to hold a referendum on secession from Spain.

But they punished the main separatist group, Mas’s Convergence and Union alliance, or CiU, cutting back its seats to 50 from 62. That will make it difficult for Mas to lead a united drive to hold a referendum in defiance of the constitution and the central government in Madrid.

“Mas clearly made a mistake. He promoted a separatist agenda and the people have told him they want other people to carry out his agenda,” said Jose Ignacio Torreblanca, head of the European Council on Foreign Relations’ Madrid office.

The result will come as a relief for Spanish Prime Minister Mariano Rajoy, who is battling a deep recession and 25 percent unemployment while he struggles to cut high borrowing costs by convincing investors of Spain’s fiscal and political stability.

Mas, surrounded by supporters chanting “independence, independence”, said he would still try to carry out the referendum but added that, “it is more complex, but there is no need to give up on the process.”

Resurgent Catalan separatism had become a major headache for Rajoy, threatening to provoke a constitutional crisis over the legality of a referendum just as he is trying to concentrate on a possible international bailout for troubled Spain.

Frustration over the Spanish tax system, under which Catalonia shares some of its tax revenue with the rest of the country, has revived a long-dormant secessionist spirit in Catalonia. Catalans believe if they could invest more of their taxes at home their economy would prosper.

Mas had tried to ride the separatist wave after hundreds of thousands demonstrated in the streets in September, demanding independence for their region, which has its own language and sees itself as distinct from the rest of Spain.

In a speech to supporters on Sunday night, Mas recognized that he had lost ground and though CiU is still the largest group in Catalan‘s parliament, he said would need the support of another party to govern and to continue pushing through tough economic measures.

“We’ve fallen well short of the majority we had. We’ve been ruling for two years under very tough circumstances,” he said.

Traditional separatists the Republican Left, or ERC, won the second biggest presence in the Catalan parliament, with 21 seats. The Socialists took 20 seats. And Rajoy’s center-right People’s Party won 19.

Three other parties, including two that want a referendum on independence, split the remaining 25 seats. ECFR’s Torreblanca said the Catalan elections were similar to those around Europe in that economic woes have benefited marginal political groups, while larger, traditional parties have lost ground.

MAS MADE BIG BET

Mas’s bet on separatism may have helped out the big winner of Sunday’s election, the Republican Left, which more than doubled its seats in the Catalan parliament to 21 from 10,

“He talked about it so much that he ended up helping the only party that has always been for independence, which is the Republican Left,” said political analyst Ismael Crespo at the Ortega y Gasset research institute.

A legal referendum would require a change to the constitution, and Spain’s main parties in the national parliament, the Socialists and Rajoy’s People’s Party, have shown no appetite for that.

Mas’s CiU had traditionally been a pro-business moderate nationalist party that fought for more autonomy and self-governance for Catalonia without breaking away from Spain.

Mas broke with that tradition in September when he made a big bet on a referendum.

Catalonia, with 7.5 million people, is more populous than Denmark. Its economy is almost as big as Portugal’s and it generates one fifth of Spanish gross domestic product.

After a decade of overspending during Spain’s real estate boom, Catalonia and most of the country’s other regions are struggling to pay state workers and meet debt payments. Unemployment has soared and spending on hospitals and schools has been cut.

Mas was one of the first Spanish leaders to embark on harsh austerity measures after Catalonia’s public deficit soared and the regional government was shunned by debt markets.

Josep Freixas, 37 and unemployed, voted for CiU but recognized the party had lost seats “because people have been really affected by the spending cuts and by the crisis.”

At CiU headquarters on Sunday night Freixas carried a rolled up pro-independence flag – a single star against yellow and red stripes – that has become a symbol of the separatist movement.

Turnout was very high in the election, 68 percent, 10 percentage points higher than in the previous vote two years ago.

Many Catalans are angry that Rajoy has refused to negotiate a new tax deal with their largely self-governing region. Annually, an estimated 16 billion euros ($ 21 billion) in taxes paid in Catalonia, about 8 percent of its economic output, is not returned to the region.

Home to car factories and banks and birthplace of surrealist painter Salvador Dali and architect Antoni Gaudi, the region also has one of the world’s most successful football clubs, FC Barcelona.

Wary that separatism could spread to the Basque Country and beyond, Rajoy said this week that the Catalan election was more important than general elections.

(The story corrects billion to million in 20th paragraph.)

(Editing by Myra MacDonald and Sandra Maler)

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