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Leaked internal messages reveal Sam Altman strategized in 2023 to release a local GPT-3-class model to suppress competitors and dry up funding; separately, a security researcher found a WordPress RCE using GPT-5.6 for $25, and Kimi K3's 2.8T open-weights release continued pressure on closed frontier labs. In pharma, Eli Lilly's psychedelics acquisition drew further industry analysis, GSK axed its key cough drug candidate, and a state Medicaid audit exposed PBM cost-obscuring tactics. The economy section covers Waymo safety data, the UK as a cautionary macro tale, and Basel III's hidden fragility inside bank holding companies.

Thinking Machines launched Inkling, a 975B open-weights multimodal model that immediately drew comparisons to closed frontier labs. xAI's Grok CLI sparked a data-privacy backlash after users reported it uploading entire home directories. Eli Lilly acquired psychedelics biotech AtaiBeckley for $2.8B, and CMS signaled a structural overhaul of how it pays for clinical AI.

Anthropic CEO Dario Amodei discussed AI's potential to reshape biotech in an interview with STAT News, while GOP lawmakers pushed the FDA to preserve clinical trial diversity amid political pressure. Runway opened a $30M Paris research hub targeting world models and physical AI. Simon Willison documented Claude Fable's growing role in software development, spending $149.25 to write most of sqlite-utils 4.0rc2. Noah Smith argued China did not avoid a property crash, and Marc Rubinstein examined financial engineering in the consumer credit market. Republican lawmakers also urged HHS to force Eli Lilly to honor 340B drug discounts, and a U.S. judge blocked Colorado from capping Amgen's Enbrel price.

Anthropic accused Alibaba of illicitly extracting Claude's model capabilities, drawing 829 Hacker News comments and raising fresh questions about AI IP enforcement. OpenAI unveiled Jalapeño, its first custom inference chip built with Broadcom, a move that reshapes its dependency on Nvidia. GLM-5.2 crossed a threshold Nathan Lambert called the step change for open agents. Google introduced computer use in Gemini 3.5 Flash, and U.S. health spending rose 7.3% in 2025, driven by GLP-1 drug adoption and higher care utilization. A bipartisan bill would expand methadone access by letting physicians prescribe it outside specialty clinics.

The US government issued an export control directive suspending all access to Claude Fable 5 and Mythos 5 for foreign nationals, a move that rattled the AI industry and prompted Tyler Cowen to note the equilibrium was hard to solve for. Separately, Arvind Narayanan and Sayash Kappoor published a detailed argument that software engineers won't be replaced by AI, citing task fragmentation and the compounding cost of errors. The FDA approved Sanofi's teplizumab for children with stage 3 type 1 diabetes after it cleared a dispute between career staff and political appointees. Noah Smith asked whether Chinese corporate debt could zombify the economy, while Patrick Boyle examined how SpaceX humiliated Wall Street by retaining founder control across 25x more fundraising than typical startups.

Sebastian Raschka published a comprehensive 2025 LLM review covering DeepSeek R1, RLVR, inference-time scaling, and 2026 predictions, while Simon Willison released his annual year-in-LLMs retrospective. On the pharma front, NIH Director Jay Bhattacharya confirmed that DEI-related grants restored under a court order will not be renewed in 2026, even as NIH began reviewing thousands of delayed proposals and funded 135 on the first day. Novo Nordisk priced its newly approved Wegovy pill below Eli Lilly's competing obesity drug in a direct-to-consumer push. On the economy side, researchers across 16 countries found that the post-1980 labor share decline is driven by the composition of capital, not its quantity, and building more structures may reverse it.