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Teva Pharmaceutical set for major layoffs in Israel, U.S. -report

November 24, 2017
Life sciences

Teva Pharmaceutical Industries is expected to cut 20-25 percent of its 6,860 workers in Israel and a few thousand more in the United States, financial news website Calcalist reported on Thursday.

The world’s largest generic drugmaker will send termination letters to “tens of percents” of its 10,000 employees in the United States in upcoming weeks, Calcalist reported, citing people familiar with the matter.

New Teva CEO Kare Schultz is working out the details with regional management in Israel and the United States, Calcalist said, noting those set to be ousted include its chief scientific officer, Michael Hayden, Teva’s president of research and development.

A spokesman for Israel-based Teva declined to comment on the report.

Teva is widely expected to implement a cost-cutting programme following the publication of third-quarter results earlier this month.

The company said it would miss 2017 profit forecasts due to falling prices of generics in the U.S. market and weakening sales of its multiple sclerosis drug Copaxone.

Saddled with nearly $35 billion in debt due to its $40.5 billion acquisition of Allergan’s generic drug business Actavis last year, investors have been pushing Teva for clarity on its future.

“It will be an absolute priority for me that we stabilise the company’s operating profit and cash flow in order to improve our financial profile,” Schultz said on a post-earnings call with analysts.

Interim Chief Financial Officer Mike McClellan has said the company was “working on a 2018 plan and evaluating all options”.

Teva has been selling off assets to help meet its debt payments.

Fitch Ratings this month downgraded Teva’s debt to junk.

By Tova Cohen

Source: Reuters via Business Insider

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