Teva to Divest API CDMO Business
Teva Pharmaceutical Industries has announced its plan to divest its third-party active pharmaceutical ingredient (API) business, Teva API (including its R&D, manufacturing and commercial activities), through a sale, with the divestment expected to be completed in the first half of 2025. The planned divestment is in line with the company’s “Pivot to Growth” strategy, a restructuring and growth initiative introduced last May (May 2023).
The company’s “Pivot to Growth” strategy is based on four key pillars. The first pillar is delivering growth in its late-stage pipeline of biosimilars and for key innovator drugs—Austedo (deutetrabenazine) for treating chorea associated with Huntington’s disease and tardive dyskinesia (a nervous system disorder caused from side effects of certain antipsychotic medications) and Ajovy (fremanezumab) for treating migraines—and for Uzedy, (risperidone) an extended-release injectable suspension to treat schizophrenia in adults.
Its second pillar is stepping up innovation through its late-stage innovative pipeline assets as well as building up its early-stage pipeline organically and potentially through business development activities. The third pillar of its growth strategy is sustaining its generics medicines business with a global commercial footprint, focused portfolio, pipeline and manufacturing footprint. The last piece of its growth strategy is to optimize its portfolio and global manufacturing footprint to enable strategic capital deployment in near and long-term growth engines and reorganizing certain of its business units to a more optimal structure while also reorganizing key business units to enhance operational efficiency.
The company reported 2023 global revenues of $15.87 billion, an increase of 6%, in US dollars or 7% in local currency terms, compared to 2022. This increase was mainly due to an upfront payment received in connection with its $1.5-billion collaboration with Sanofi on Teva’s anti-TL1A asset (TEV’ 574) for treating inflammatory bowel disease, higher revenues from generic products in its International Markets and Europe segments, higher revenues from its innovator products, Austedo and Ajovy, the sale of certain product rights in its Europe segment, as well as higher revenues from Anda, a generic-drug distribution business. These gains were partially offset by lower revenues from the following: its multiple sclerosis drug, Copaxone (glatiramer acetate); sales to third parties; its blood-cancer drugs, Bendeka (bendamustine) and Treanda (bendamustine); and generic products in its North America segment.
Teva, which is globally headquartered in Tel Aviv, Israel, and has several manufacturing and R&D facilities in Israel, says that currently its activities in Israel remain largely unaffected as a result of the war in Gaza and surrounding areas. The company says it continues to maintain contingency plans with backup production locations for key products. During the year ended December 31, 2023, the company said that the impact of the war on Teva’s results of operations and financial condition was immaterial following the beginning of the conflict in October 2023.