12.14.17
Teva Pharmaceutical Industries Ltd. is restructuring in an effort to significantly reduce costs and simplify its organization as it faces $35 billion of acquisition-related debt and increasing competition. The company will eliminate 14,000 positions globally, more than 25% of Teva’s total workforce, over the next two years. The majority of cuts are expected to occur in 2018. Also, the company will continue to review the potential for additional divestment of non-core assets.
Teva plans to cut $3 billion in costs by the end of 2019 and expects to record a restructuring charge of at least $700 million, mainly related to severance costs, with additional charges possible following decisions on closures or divestments of manufacturing plants, R&D facilities, headquarters and other office locations.
The company plans to optimize its generics portfolio globally, specifically in the U.S., through price adjustments and/or product discontinuation. This aims to accelerate the restructuring of its manufacturing and supply network, including the closures or divestments of a significant number of manufacturing plants in the U.S., Europe, Israel and Growth Markets.
The company plans to close or divest a significant number of R&D facilities, headquarters and other office locations across all geographies. The company will also review all R&D programs in generics and specialty, to prioritize core projects and terminate others.
Kåre Schultz, Teva’s president and chief executive officer, said, "Two weeks ago we announced a new organizational structure and executive management team. Today we are launching a comprehensive restructuring plan, crucial to restoring our financial security and stabilizing our business. We are taking immediate and decisive actions to reduce our cost base across our global business and become a more efficient and profitable company.”
"We will execute this plan in a timely and prudent manner, remaining focused on revenue and cash flow generation, in order to make sure Teva is ready to meet all of its financial commitments. Teva will optimize its cost base while ensuring that we protect our revenues and preserve our core capabilities in generics and in select specialty assets, in order to secure long-term growth. In 2018, we expect to secure the successful launches of Austedo and fremanezumab."
Teva plans to cut $3 billion in costs by the end of 2019 and expects to record a restructuring charge of at least $700 million, mainly related to severance costs, with additional charges possible following decisions on closures or divestments of manufacturing plants, R&D facilities, headquarters and other office locations.
The company plans to optimize its generics portfolio globally, specifically in the U.S., through price adjustments and/or product discontinuation. This aims to accelerate the restructuring of its manufacturing and supply network, including the closures or divestments of a significant number of manufacturing plants in the U.S., Europe, Israel and Growth Markets.
The company plans to close or divest a significant number of R&D facilities, headquarters and other office locations across all geographies. The company will also review all R&D programs in generics and specialty, to prioritize core projects and terminate others.
Kåre Schultz, Teva’s president and chief executive officer, said, "Two weeks ago we announced a new organizational structure and executive management team. Today we are launching a comprehensive restructuring plan, crucial to restoring our financial security and stabilizing our business. We are taking immediate and decisive actions to reduce our cost base across our global business and become a more efficient and profitable company.”
"We will execute this plan in a timely and prudent manner, remaining focused on revenue and cash flow generation, in order to make sure Teva is ready to meet all of its financial commitments. Teva will optimize its cost base while ensuring that we protect our revenues and preserve our core capabilities in generics and in select specialty assets, in order to secure long-term growth. In 2018, we expect to secure the successful launches of Austedo and fremanezumab."