June 8, 2023


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Teva Pharmaceutical Industries: a financial analysis one of the best stocks in the market

Teva Pharmaceutical Industries full-year adjusted profit margin is 15.6{de3fc13d4eb210e6ea91a63b91641ad51ecf4a1f1306988bf846a537e7024eeb}, down from 16.3{de3fc13d4eb210e6ea91a63b91641ad51ecf4a1f1306988bf846a537e7024eeb} in 2018. The company also records $1.78 billion in impairments of intangible and fixed assets, primarily related to the acquisition of Actavis Generics. Despite the decline in full-year earnings, the updates several months. On February 3, Teva announced positive top-line results from two Phase 2/3 trials of Ajovi (fremanezumab), a medication for adults with difficult-to-treat migraines, in patients in Japan. Having received FDA approval for the product in September 2018 and European Commission approval in April 2019, the company plans to use the latest data to support a Pharmaceutical and Medical Devices Agency (PMDA) application in Japan. On November 8, 2019, Teva and Celltrion announced the availability of its Truxima injection, U.S. Tuxima is currently non-Hodgkin’s Lymphoma (NHL) and Chronic Lymphocytic Leukemia (CLL). Despite these recent developments, management has scaled back its R&D program in order to provide resources for restructuring; in 4Q19, companywide adjusted R&D spending fell 18{de3fc13d4eb210e6ea91a63b91641ad51ecf4a1f1306988bf846a537e7024eeb} to $237 million due to pipeline optimization and efficiencies related to its restructuring plan.

Given the decrease in Copaxone revenue and pressures in the broader generic drug market, management embarked on a restructuring program in December 2017 to lower costs. At the end of 2Q21, the company has completed its two-year program and has reduced its relative to 2017 spending. The restructuring resulted in the closure of 40 office sites and 23 manufacturing sites, some of which are still in the process of final closure and the termination of more than 13,000 employees. During the entire year of 2019, Teva recorded restructuring expenses of $199 million, down from $488 million in 2018. company’s company’s operational capacity.


In Europe, revenue declined 1.7{de3fc13d4eb210e6ea91a63b91641ad51ecf4a1f1306988bf846a537e7024eeb} to $1.18 increased 2{de3fc13d4eb210e6ea91a63b91641ad51ecf4a1f1306988bf846a537e7024eeb}, primarily the company’s oncology portfolio. Total segment profit rose 2.0{de3fc13d4eb210e6ea91a63b91641ad51ecf4a1f1306988bf846a537e7024eeb}, to $258 million following the release of the company’s fourth-quarter results, reflecting the continued declines of Copaxone sales, somewhat offset by expanded geographies for existing products. We are also setting a 2021 EPS estimate of $2.77, which implies earnings growth of about 9{de3fc13d4eb210e6ea91a63b91641ad51ecf4a1f1306988bf846a537e7024eeb}, improved margins and contributions from new products.


Kare Schults has named to the role of CEO in September 2017 with Mr. Kalif has executive finance Chef. In May 2019, Connecticut Attorney General William Tong filed a 35-count lawsuit against 20 companies, including Teva, alleging an extensive drug price-fixing conspiracy. According to Mr. Tong, Teva raised its prices on 112 different generic drugs between July 2013 and January 2015, in some cases by as much as 1,000{de3fc13d4eb210e6ea91a63b91641ad51ecf4a1f1306988bf846a537e7024eeb}, and colluded with competitors in at least 86 of these cases. While the defendants have attempted to dismiss this lawsuit, a judge for the U.S. denied their motion. Teva could face significant liability from this lawsuit. In May 2019, Teva paid $85 million to settle an Oklahoma lawsuit related to its role as a manufacturer of opioids but denied any wrongdoing in the matter. The company has proposed a settlement to its other worth to provide the cost of production.

The stock in 2020 gained more than 35{de3fc13d4eb210e6ea91a63b91641ad51ecf4a1f1306988bf846a537e7024eeb}. The stock is now trading about 18{de3fc13d4eb210e6ea91a63b91641ad51ecf4a1f1306988bf846a537e7024eeb} 34{de3fc13d4eb210e6ea91a63b91641ad51ecf4a1f1306988bf846a537e7024eeb} above its 200-day average. While the shares have now fallen slightly over the past couple of trading days, we view this as a normal correction, necessary for the stock to achieve further gains. With its currently sitting around 62, has room to continue its advance before becoming overbought. The company made recent successful product launches, its cost reduction efforts, and changes to its product mix, implying growth of about 23{de3fc13d4eb210e6ea91a63b91641ad51ecf4a1f1306988bf846a537e7024eeb} from current levels.