Sector News

Teva kept quiet for weeks on forthcoming generics blow: report

August 14, 2017
Life sciences

That big generics pricing hit that’s helped lop billions off of Teva’s market cap over the last week? The company knew it was coming—and stayed mum for five weeks.

As Haaretz reports, wholesalers Walmart and McKesson forced the Israeli drugmaker to slash prices on drugs it sold them sometime during the second quarter, interim CEO Yitzhak Peterburg told analysts following a disastrous earnings announcement. And that quarter ended June 30.

The pressure followed a move by the pair to form a single joint purchasing entity, dubbed ClarusOne, and increase their bargaining power. “This development and other new contracts had a greater-than-expected negative impact on our Q2 results and especially on the outlook for the remainder of the year,” Peterburg said, as quoted by the newspaper.

While the move wasn’t illegal, it doesn’t exactly inspire confidence in Teva’s transparency or management, Haaretz notes. RBC Capital Markets analyst Randall Stanicky, for one, cited “lack of confidence in Teva’s ability to forecast the business” as one factor when he downgraded the stock last week.

Teva has been pummeled since it unveiled weak results last Thursday—and walked back guidance by $1 billion-plus, took a $6.1 billion write-down on its generics business, slashed its dividend, announced thousands of layoffs and more. It’s also run into the risk of breaching its debt covenants, thanks to a $35 million hole it dug with a disastrous purchase of Allergan’s generics unit.

On the debt front, though, the company is hoping some asset sell-offs can help gin up cash—and it may have found at least one interested buyer. India’s Intas, which last year snapped up the U.K. and Ireland assets Teva had to divest to close its Allergan deal, is prepping a $1.5 billion bid for Teva’s European women’s health, oncology and pain management divisions, The Economic Times says.

Teva also indicated this week that it was weighing a cast-off of Medis, an Iceland-based unit that develops generics for other drugmakers. And according to Bloomberg, the company is considering selling off some of its respiratory treatments, too.

By Carly Helfand

Source: Fierce Pharma

comments closed

Related News

January 29, 2023

Colorcon, Inc. signs Put agreement with intent to acquire controlled atmosphere packaging specialist Airnov Healthcare Packaging

Life sciences

Airnov provides critical healthcare industries with high-quality, controlled atmosphere packaging, to protect their products from moisture and oxygen. The business has manufacturing facilities in the USA, France, China and India and employs around 700 people.

January 29, 2023

Takeda pledges up to $1.13B for rights to Hutchmed’s cancer drug fruquintinib outside of China

Life sciences

Takeda of Japan has partnered with Hong Kong-based Hutchmed, gaining the commercial rights to colorectal cancer drug fruquintinib outside of China for $400 million up front, plus $730 million in potential milestone payments. Takeda also will help develop fruquintinib, which can be applied to subtypes of refractory metastatic colorectal cancer, regardless of biomarker status, the companies said.

January 29, 2023

Vir taps Bayer dealmaker Marianne De Backer as its next CEO

Life sciences

On April 3, Scangos, who’s been chief executive officer at Vir since the start of 2017, will hand over the reins to Marianne De Backer, Ph.D. De Backer comes over from Bayer, where she currently heads up pharmaceutical strategy, business development and licensing. Alongside her CEO appointment, De Backer is set to join Vir’s board of directors, the company said Wednesday.

How can we help you?

We're easy to reach