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Dmitry Medvedev was sworn in as Russia's third president, succeeding Vladimir Putin, with promises to fight corruption and inflation in partnership with a predecessor who may try to overshadow him.

Medvedev took the oath of office, administered by Constitutional Court Chairman Valery Zorkin, in a Kremlin ceremony attended by 2,500 government officials and ambassadors today. Putin is head of the United Russia party, which dominates parliament, and is set to become prime minister tomorrow, possibly setting up a battle for leadership.

“I want to assure all citizens of this country today that I will work with all my strength as president and as a man for whom Russia is his native home, his native land,'' Medvedev said in a speech broadcast live on state television.

Medvedev, 42, a longtime Putin ally, rose to the rank of first deputy prime minister under his predecessor. He has been chairman of OAO Gazprom, Russia's natural-gas export monopoly, for more than six years. He's due to give up that job on becoming Russia's youngest leader in modern times.

Economic Growth

He assumes control of a country in its 10th straight year of economic growth. Russia, the world's biggest energy exporter, has benefited from record oil and gas prices, with the economy growing at an average 7 percent a year. That growth has pushed up wages, the ruble and inflation, making Russia less competitive. Medvedev has vowed to curb inflation, without presenting a specific program for doing so.

“Economically we have a big inflation problem,'' Michael Ganske, head of emerging market research at Commerzbank AG, said in a Bloomberg Television interview. “This is the problem Medvedev needs to solve to broaden his political base and gain the support of the public.''

Medvedev made clear he expects Putin to continue to play a central leadership role, thanking him for his “unwavering personal support, which I have constantly felt. I am sure that this will be so in the future.'' After the inauguration ceremony, Putin accompanied his successor as they reviewed a march-past by the Presidential Guard.

`Legal Nihilism'

Medvedev emphasized his “obligation to respect and preserve human rights and freedoms,'' while adding that “we must establish genuine respect for the law, to overcome legal nihilism, which seriously impedes development.'' He renewed his vow to fight corruption in government and society.

Berlin-based watchdog Transparency International last year said businesspeople and analysts perceive Russia as being among the most corrupt countries of 180 it studied, with a ranking of 143 payday loan.

“Every Russian leader since Gorbachev and Yeltsin made the same promises at the start of their term, but unfortunately little was done to implement these promises,'' Yevgeny Volk, a Moscow-based analyst for the Heritage Foundation, a U.S. research group, said in an interview. He described Medvedev as an “apparatchik'' who will “protect the system of crony capitalism in today's Russia.''

Putin told guests at the ceremony that he had come to power in 2000 vowing “to work openly and honestly, faithfully serving the people and the state. And I didn't break my promise.''

Sharing Power

The State Duma, or lower house of parliament, will convene tomorrow to vote on Putin's nomination as prime minister. The government of Prime Minister Viktor Zubkov resigned immediately after the inauguration, clearing the way for Medvedev to confirm Putin's Cabinet.

Putin has repeatedly said he won't change the constitution in order to increase his powers as prime minister at the expense of the president.

Kremlin spokesman Dmitry Peskov declined to comment on a May 5 Gazeta newspaper report that Putin plans to push through a constitutional amendment to bolster his influence.

Gazeta reported that Putin will more than double the number of deputy prime ministers and shift control of the Foreign Ministry, Defense Ministry and security services from the Kremlin to the prime minister's office.

“Before any such decisions are officially made, these reports are rumors, and we don't comment on rumors,'' Peskov said.

Putin strengthened his grip on power last month when he became head of United Russia. The party has little in the way of ideology beyond backing Putin and making sure the country remains a global power. It's designed to keep the same elite in control for decades, much like the Soviet Union's Communist Party and Mexico's Institutional Revolutionary Party.

“We are now moving into phase two of the neo-authoritarian project in Russia,'' said Robin Shepherd, senior fellow at Chatham House, a London research organization. “It is quite possible that United Russia will emerge as the key medium through which Putin and his clique acquire an enduring stranglehold over the Russian political system.''

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The Federal Reserve announced Friday that it will expand a series of efforts to deal with the global credit crisis, in coordination with European central banks.

The Fed said it was boosting the amount of emergency reserves it supplies to U.S. banks to $150 billion in May, from the $100 billion it supplied in April. The Fed took this action and several other moves to boost credit in coordination with the European Central Bank and the Swiss National Bank.

The latest moves are part of a series of actions the Fed has made since the credit crisis struck in August.

The efforts are designed to increase reserves so that banks don’t become hesitant about lending to consumers and businesses, which would make the current economic slowdown even more severe.

The Fed’s decision to boost the amount of loans it makes to banks every two weeks, in a process known as a Term Auction Facility, was aimed at sending a strong signal that the central bank is prepared to supply as much in reserves as U.S. banks need. The latest move was made in coordination with the European central banks’ efforts to bolster their financial systems as well.

The Fed said it was also expanding the types of assets that investment banks can use as collateral to receive loans from the central bank internet payday loans. In March, the Fed used powers it obtained during the Great Depression to begin making loans to investment banks. Previously, the Fed only made direct lends to commercial banks.

The European Central Bank said it will increase the amount of dollars offered to $25 billion in the latest series of tenders, with the auctions to come every two weeks. The tenders’ maturity will be 28 days. Previously, the ECB has auctioned off amounts that have ranged from $10 billion to $15 billion per tender but without a set schedule.

"It is intended to continue the provision of U.S. dollar liquidity for as long as the governing council considers it to be needed in view of the prevailing market conditions," the bank said in a statement.

Switzerland’s central bank also said it would increase the scheduled frequency of its own auctions to every 14 days, with a maximum allocation of $6 billion per auction. Its next auction is scheduled for May 6 with a settlement on May 8. Like the ECB, the term would be 28 days. 

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CVS Caremark Corp., the nation’s biggest pharmacy chain, said Thursday that first-quarter profit jumped 84%, helped by surging sales in the wake of last year’s purchase of Caremark.

Profit climbed to $745 million, or 51 cents per share, after preferred dividend payments in the quarter ended March 29, up from $405.4 million, or 43 cents per share, in the prior year, the Woonsocket-based company said.

Excluding 4 cents per share for acquisition activities, earnings were 55 cents per share, meeting the expectations of analysts surveyed by Thomson Financial.

Revenue surged 61% to $21.3 billion, up from $13.2 billion a year ago, also meeting analysts’ estimates.

Shares of CVS (CVS, Fortune 500) rose 9 cents to $40.46 in midday trading after trading as low as $39.02 earlier in the session.

CVS purchased pharmacy benefits management company Caremark in March 2007. Chief Financial Officer David Rickard said revenues were $10.8 billion in that segment for the quarter, an increase of 2.3% from a year ago.

Stephanie Hoff, a senior retail analyst with Edward Jones, said the results in that segment came in slightly under what analysts had hoped for. But she said the results were still strong, with both sides of the business delivering higher operating margins.

"On a full year basis, they’re still generating a pretty healthy level of growth," she said. "The fact that they have a PBM now has certainly helped buffer a weaker economy."

The company said an Easter that came in March rather than in April this year helped same-store sales to grow 3.9% from the prior year, with pharmacy sales rising 3.7% and front end sales up 4.3%.

Rickard said CVS had seen no evidence of a consumer slowdown.

"Consumers are making tough choices on big ticket purchases, but they aren’t yet focused on Snickers bars," he said.

CVS is pulling back on its expansion of MinuteClinics, in-store clinics that offer treatments for a menu of common ailments. CVS operated 510 clinics at the end of the first quarter. The company said earlier this year that it planned to open 200 to 300 new clinics this year, but that is being scaled back to 100 new clinics, and the company may also close some existing clinics, Rickard said.

He said the company remains "very optimistic" about MinuteClinic, but will instead focus on adding and enriching services.

"In any new business you learn as you go, and you adjust priorities accordingly," he said.

For the year, Rickard said CVS expected adjusted earnings per share in the range of $2.44 to $2.50, growth of 18% to 21%. The company expects to save about $700 million in 2008 from the merger, much through purchasing, Rickard said.

In March, CVS agreed to pay almost $37 million to nearly two dozen states and the federal government to settle claims that it had billed Medicaid programs for a more expensive antacid.

CVS operates more than 6,300 retail, specialty and mail order pharmacy stores in 44 states and the District of Columbia. 

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Biotechnology companies Genentech Inc. and Biogen Idec Inc. said Tuesday their drug Rituxan failed a late-stage study involving lupus patients.

The drug, which is already approved to treat non-Hodgkins lymphoma and rheumatoid arthritis, failed to prompt a response in patients when compared with placebo in the 52-week study.

The drug also failed to meet any of its six secondary goals.

"We are disappointed in the results of this Phase II/III study, but we understood from the outset the significant challenges in developing treatments for systemic lupus erythematosus," said Dr. Hal Barron, Genentech’s senior vice president of development and chief medical officer, in a statement.

The company has another ongoing late-stage study on lupus nephritis patients and said that will continue payday loan. Lupus nephritis is an inflammation of the kidney caused by lupus, a chronic inflammatory disease. Results from that study are expected in the first quarter of 2009.

Shares of Cambridge, Mass.-based Biogen (BIIB) fell $2.75, or 4.3%, to $61.92 in morning trading Tuesday.

Shares of South San Francisco, Calif.-based Genentech (DNA) fell $3.25, or 4.4%, to $69.91. 

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