Teva doesn't foresee more specialty drug divests, CFO says
09 JAN 2018
Teva Pharmaceutical Industries [NYSE:TEVA] is unlikely to divest additional specialty drugs in its restructuring plan that is aimed at sharply reducing the company’s USD 32bn in debt, said CFO Michael McClellan.
The Israeli drugmaker faces significant financial challenges due to generic competition of its best-selling multiple sclerosis drug Copaxone as well as price erosion in the US generic market.
CEO Kåre Schultz explained during a presentation at the 2018 JPMorgan Healthcare Conference that the FDA’s move to quickly approve generic medicines as well as consolidation among generic buying consortia has created a challenging US market for generic medicines.
McClellan said on the sidelines of the conference that any future divestiture would likely be on the fringes of the company’s portfolio and would probably not include its specialty products.
CEO Kåre Schultz explained during a presentation at the 2018 JPMorgan Healthcare Conference that the FDA’s move to quickly approve generic medicines as well as consolidation among generic buying consortia has created a challenging US market for generic medicines.
McClellan said on the sidelines of the conference that any future divestiture would likely be on the fringes of the company’s portfolio and would probably not include its specialty products.
Teva’s specialty portfolio includes Copaxone, Azilect, Nuvigil, ProAir, among other drugs.
The Israeli-based drugmaker sold its women’s health business — consisting of Paragard and Plan B — in September to CVC Capital Partners and Foundation Consumer Healthcare for USD 1.3bn.
Kåre said that Teva does not plan to make any major acquisitions in the next four years as it looks to reduce its debt, but would explore investing in growth opportunities. McClellan said that the company was unlikely to make any acquisitions that would significantly add to its debt at this time.
During the company’s breakout session, McClellan said the impact of US tax reform would have a slightly negative effect on the company in the short term, citing interest payments on its debt, but would be neutral in the long term.