エドガーで原本を確認する
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Israel |
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(State or other jurisdiction of incorporation or organization) |
(IRS Employer Identification Number) |
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124 Dvora HaNevi’a St., Tel Aviv,
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6944020 |
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(Address of principal executive offices) |
(Zip code) |
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Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered |
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American Depositary Shares, each representing one Ordinary Share |
TEVA |
New York Stock Exchange |
| Large accelerated filer | ☒ |
Accelerated filer |
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Non-accelerated filer |
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Smaller reporting company |
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Emerging growth company |
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
For an accessible version of this Quarterly Report on Form 10-Q, please visit www.tevapharm.com
INDEX
| PART I. | Financial Statements (unaudited) |
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| Item 1. | ||||||
| 3 | ||||||
| 4 | ||||||
| 5 | ||||||
| 8 | ||||||
| 9 | ||||||
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
52 | ||||
| Item 3. | 79 | |||||
| Item 4. | 79 | |||||
| PART II. | OTHER INFORMATION |
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| Item 1. | 80 | |||||
| Item 1A. | 80 | |||||
| Item 2. | 80 | |||||
| Item 3. | 80 | |||||
| Item 4. | 80 | |||||
| Item 5. | 80 | |||||
| Item 6. | 81 | |||||
| 82 | ||||||
| • | our ability to successfully compete in the marketplace, including: that we are substantially dependent on our generic products; concentration of our customer base and commercial alliances among our customers; competition faced by our generic medicines from other pharmaceutical companies and changes in regulatory policy that may result in additional costs and delays; delays in launches of new generic products; our ability to develop and commercialize additional pharmaceutical products; competition for our innovative medicines; our ability to achieve expected results from investments in our product pipeline; our ability to successfully execute our Pivot to Growth strategy, including to expand our innovative and biosimilar medicines pipeline and profitably commercialize the innovative medicines and biosimilar portfolio, whether organically or through business development, to sustain and focus our portfolio of generic medicines, and to execute on our organizational transformation and to achieve expected cost savings; and the effectiveness of our patents and other measures to protect our intellectual property rights, including any potential challenges to our Orange Book patent listings in the U.S.; |
| • | our significant indebtedness, which may limit our ability to incur additional indebtedness, engage in additional transactions or make new investments; and our potential need to raise additional funds in the future, which may not be available on acceptable terms or at all; |
| • | our business and operations in general, including: the impact of global economic conditions and other macroeconomic developments and the governmental and societal responses thereto; the widespread outbreak of an illness or any other communicable disease, or any other public health crisis; effectiveness of our optimization efforts; significant disruptions of information technology systems, including cybersecurity attacks and breaches of our data security; interruptions in our supply chain or problems with internal or third party manufacturing; challenges associated with conducting business globally, including political or economic instability, major hostilities or terrorism, such as the ongoing conflict between Russia and Ukraine and the state of war declared in Israel; our ability to attract, hire, integrate and retain highly skilled personnel; our ability to successfully bid for suitable acquisition targets or licensing opportunities, or to consummate and integrate acquisitions; and our prospects and opportunities for growth if we sell assets or business units and close or divest plants and facilities, as well as our ability to successfully and cost-effectively consummate such sales and divestitures, including our planned divestiture of our API business; |
| • | compliance, regulatory and litigation matters, including: failure to comply with complex legal and regulatory environments; the effects of governmental and civil proceedings and litigation which we are, or in the future become, party to; the effects of reforms in healthcare regulation and reductions in pharmaceutical pricing, reimbursement and coverage, including as a result of the One Big Beautiful Bill signed into law in the U.S. in July 2025 (“OBBBA”), which is expected to result in stricter Medicaid eligibility requirements and work requirements, which may result in reduced Medicaid enrollment and a resulting decline in coverage for purchases of our medicines, and U.S. Executive Orders issued in April and May 2025 intended to reduce the prices paid by Americans for prescription medicines, including most-favored-nation pricing; increased legal and regulatory action in connection with public concern over the abuse of opioid medications; our ability to timely make payments required under our nationwide opioids settlement agreement and provide our generic version of Narcan ® (naloxone hydrochloride nasal spray) in the amounts and at the times required under the terms of such agreement; scrutiny from competition and pricing authorities around the world, including our ability to comply with and operate under our deferred prosecution agreement (“DPA”) with the U.S. Department of Justice (“DOJ”); potential liability for intellectual property right infringement; product liability claims; failure to comply with complex Medicare, Medicaid and other governmental programs reporting and payment obligations; compliance with sanctions and trade control laws; environmental risks; and the impact of Environmental, Social and Governance (“ESG”) issues; |
| • | the impact of the state of war declared in Israel and the military activity in the Middle East, including the risk of disruptions to our operations and facilities, such as our manufacturing and R&D facilities, located in Israel, the impact of our employees who are military reservists being called to active military duty, and the impact of the war on the economic, social and political stability of Israel; |
| • | other financial and economic risks, including: our exposure to currency fluctuations and restrictions as well as credit risks; potential impairments of our long-lived assets; the impact of geopolitical conflicts including the state of war declared in Israel and the conflict between Russia and Ukraine; potential significant increases in tax liabilities; the effect on our overall effective tax rate of the termination or expiration of governmental programs or tax benefits, or of a change in our business; our exposure to changes in international trade policies, including the imposition of tariffs in the jurisdictions in which we operate, and the effects of such developments on sales of our products and the pricing and availability of our raw materials; and the impact of any future failure to establish and maintain effective internal control over our financial reporting; |
ITEM 1. |
FINANCIAL STATEMENTS |
June 30, 2025 |
December 31, 2024 |
|||||||
| ASSETS |
||||||||
| Current assets: |
||||||||
| Cash and cash equivalents |
$ | 2,161 | $ | 3,300 | ||||
| Accounts receivables, net of allowance for credit losses of $84 million and $78 million as of June 30, 2025 and December 31, 2024, respectively. |
3,564 | 3,059 | ||||||
| Inventories |
3,497 | 3,007 | ||||||
| Prepaid expenses |
1,084 | 1,006 | ||||||
| Other current assets |
472 | 409 | ||||||
| Assets held for sale |
1,842 | 1,771 | ||||||
| |
|
|
|
|||||
| Total current assets |
12,620 | 12,552 | ||||||
| Deferred income taxes |
1,781 | 1,799 | ||||||
| Other non-current assets |
470 | 462 | ||||||
| Property, plant and equipment, net |
4,810 | 4,581 | ||||||
| Operating lease right-of-use |
358 | 367 | ||||||
| Identifiable intangible assets, net |
4,142 | 4,418 | ||||||
| Goodwill |
15,949 | 15,147 | ||||||
| |
|
|
|
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| Total assets |
$ | 40,131 | $ | 39,326 | ||||
| |
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|
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| LIABILITIES AND EQUITY |
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| Current liabilities: |
||||||||
| Short-term debt |
$ | 464 | $ | 1,781 | ||||
| Sales reserves and allowances |
4,050 | 3,678 | ||||||
| Accounts payables |
2,498 | 2,203 | ||||||
| Employee-related obligations |
481 | 624 | ||||||
| Accrued expenses |
3,095 | 2,792 | ||||||
| Other current liabilities |
940 | 1,020 | ||||||
| Liabilities held for sale |
334 | 698 | ||||||
| |
|
|
|
|||||
| Total current liabilities |
11,861 | 12,796 | ||||||
| Long-term liabilities: |
||||||||
| Deferred income taxes |
440 | 483 | ||||||
| Other taxes and long-term liabilities |
3,938 | 4,028 | ||||||
| Senior notes and loans |
16,763 | 16,002 | ||||||
| Operating lease liabilities |
296 | 296 | ||||||
| |
|
|
|
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| Total long-term liabilities |
21,436 | 20,809 | ||||||
| |
|
|
|
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| Commitments and contingencies |
||||||||
| Total liabilities |
33,297 | 33,606 | ||||||
| |
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|
|
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| Redeemable non-controlling interests |
— | 340 | ||||||
| |
|
|
|
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| Equity: |
||||||||
| Teva shareholders’ equity: |
||||||||
| Ordinary shares of NIS 0.10 par value per share; June 30, 2025 and December 31, 2024: authorized 2,495 million shares; issued 1,253 million shares and 1,240 million shares, respectively. |
58 | 58 | ||||||
| Additional paid-in capital |
28,003 | 27,764 | ||||||
| Accumulated deficit |
(14,676 | ) | (15,173 | ) | ||||
| Accumulated other comprehensive loss |
(2,431 | ) | (3,148 | ) | ||||
| Treasury shares as of June 30, 2025 and December 31, 2024: 106 million and 107 million ordinary shares, respectively. |
(4,128 | ) | (4,128 | ) | ||||
| |
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|
|
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| 6,827 | 5,373 | |||||||
| |
|
|
|
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| Non-controlling interests |
7 | 7 | ||||||
| |
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|
|
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| Total equity |
6,834 | 5,380 | ||||||
| |
|
|
|
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| Total liabilities, redeemable non-controlling interests and equity |
$ | 40,131 | $ | 39,326 | ||||
| |
|
|
|
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Three months ended June 30, |
Six months ended June 30, |
|||||||||||||||
2025 |
2024 |
2025 |
2024 |
|||||||||||||
Net revenues |
$ |
4,176 |
$ |
4,164 |
$ |
8,067 |
$ |
7,983 |
||||||||
Cost of sales |
2,074 | 2,140 | 4,088 | 4,188 | ||||||||||||
Gross profit |
2,102 | 2,024 | 3,979 | 3,795 | ||||||||||||
Research and development expenses |
244 | 269 | 490 | 511 | ||||||||||||
Selling and marketing expenses |
654 | 656 | 1,276 | 1,265 | ||||||||||||
General and administrative expenses |
305 | 283 | 603 | 561 | ||||||||||||
Intangible assets impairments |
42 | 61 | 163 | 141 | ||||||||||||
Goodwill impairment |
— | 400 | — | 400 | ||||||||||||
Other assets impairments, restructuring and other items |
232 | 280 | 210 | 954 | ||||||||||||
Legal settlements and loss contingencies |
166 | 83 | 252 | 188 | ||||||||||||
Other loss (income) |
4 | (2 | ) | 9 | (1 | ) | ||||||||||
Operating income (loss) |
455 | (5 | ) | 975 | (223 | ) | ||||||||||
Financial expenses, net |
252 | 241 | 477 | 491 | ||||||||||||
Income (loss) before income taxes |
203 | (246 | ) | 497 | (713 | ) | ||||||||||
Income taxes (benefit) |
(78 | ) | 630 | (4 | ) | 578 | ||||||||||
Share in (profits) losses of associated companies, net |
(1 | ) | (2 | ) | (1 | ) | 2 | |||||||||
Net income (loss) |
283 | (874 | ) | 503 | (1,294 | ) | ||||||||||
Net income (loss) attributable to redeemable and non-redeemable non-controlling interests |
* | (29 | ) | 6 | (309 | ) | ||||||||||
Net income (loss) attributable to Teva |
282 | (846 | ) | 497 | (985 | ) | ||||||||||
Earnings (loss) per share attributable to ordinary shareholders: |
||||||||||||||||
Basic |
$ | 0.25 | $ | (0.75 | ) | $ | 0.43 | $ | (0.87 | ) | ||||||
Diluted |
$ | 0.24 | $ | (0.75 | ) | $ | 0.43 | $ | (0.87 | ) | ||||||
Weighted average number of shares (in millions): |
||||||||||||||||
Basic |
1,147 | 1,133 | 1,142 | 1,128 | ||||||||||||
Diluted |
1,161 | 1,133 | 1,159 | 1,128 | ||||||||||||
| * | Represents an amount less than $0.5 million. |
Three months ended June 30, |
Six months ended June 30, |
|||||||||||||||
2025 |
2024 |
2025 |
2024 |
|||||||||||||
| Net income (loss) |
$ |
283 |
$ |
(874 |
) |
$ |
503 |
$ |
(1,294 |
) | ||||||
| Other comprehensive income (loss), net of tax: |
||||||||||||||||
| Currency translation adjustment |
227 | (145 | ) | 721 | (268 | ) | ||||||||||
| Unrealized gain (loss) from derivative financial instruments, net |
17 | 7 | 24 | 14 | ||||||||||||
| Unrealized loss on defined benefit plans |
— | — | (1 | ) | (1 | ) | ||||||||||
| |
|
|
|
|
|
|
|
|||||||||
| Total other comprehensive income (loss) |
244 | (138 | ) | 744 | (255 | ) | ||||||||||
| |
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|
|
|
|
|
|
|||||||||
| Total comprehensive income (loss) |
527 | (1,012 | ) | 1,247 | (1,549 | ) | ||||||||||
| Comprehensive income (loss) attributable to redeemable and non-redeemable non-controlling interests |
* | (61 | ) | 33 | (383 | ) | ||||||||||
| |
|
|
|
|
|
|
|
|||||||||
| Comprehensive income (loss) attributable to Teva |
$ |
527 |
$ |
(951 |
) |
$ |
1,214 |
$ |
(1,166 |
) | ||||||
| |
|
|
|
|
|
|
|
|||||||||
| * | Represents an amount less than $0.5 million . |
Teva shareholders’ equity |
||||||||||||||||||||||||||||||||||||
Ordinary shares |
||||||||||||||||||||||||||||||||||||
Number of shares (in millions) |
Stated value |
Additional paid-in capital |
Retained earnings (accumulated deficit) |
Accumulated other comprehensive (loss) |
Treasury shares |
Total Teva shareholders’ equity |
Non- controlling interests |
Total equity |
||||||||||||||||||||||||||||
(U.S. dollars in millions) |
||||||||||||||||||||||||||||||||||||
Balance at March 31, 2025 |
1,253 | 58 | 27,965 | (14,958 | ) | (2,675 | ) | (4,128 | ) | 6,262 | 7 | 6,269 | ||||||||||||||||||||||||
Net Income (loss) |
282 | 282 | * | 283 | ||||||||||||||||||||||||||||||||
Other comprehensive income (loss) |
244 | 244 | 244 | |||||||||||||||||||||||||||||||||
Stock-based compensation expense |
38 | 38 | 38 | |||||||||||||||||||||||||||||||||
Balance at June 30, 2025 |
1,253 | $ | 58 | $ | 28,003 | $ | (14,676 | ) | $ | (2,431 | ) | $ | (4,128 | ) | $ | 6,827 | $ | 7 | $ | 6,834 | ||||||||||||||||
| * | Represents an amount less than $0.5 million. |
Teva shareholders’ equity |
||||||||||||||||||||||||||||||||||||
Ordinary shares |
||||||||||||||||||||||||||||||||||||
Number of shares (in millions) |
Stated value |
Additional paid-in capital
|
Retained earnings (accumulated deficit) |
Accumulated other comprehensive (loss) |
Treasury shares |
Total Teva shareholders’ equity |
Non- controlling interests |
Total equity |
||||||||||||||||||||||||||||
(U.S. dollars in millions) |
||||||||||||||||||||||||||||||||||||
Balance at December 31, 2024 |
1,240 | 58 | 27,764 | (15,173 | ) | (3,148 | ) | (4,128 | ) | 5,373 | 7 | 5,380 | ||||||||||||||||||||||||
Net Income (loss) |
497 | 497 | * | 497 | ||||||||||||||||||||||||||||||||
Other comprehensive income (loss) |
717 | 717 | 717 | |||||||||||||||||||||||||||||||||
Issuance of Shares |
13 | * | * | * | ||||||||||||||||||||||||||||||||
Proceeds from exercise of options |
3 | 3 | 3 | |||||||||||||||||||||||||||||||||
Stock-based compensation expense |
72 | 72 | 72 | |||||||||||||||||||||||||||||||||
Purchase of shares from redeemable non-controlling interests** |
165 | 165 | 165 | |||||||||||||||||||||||||||||||||
Balance at June 30, 2025 |
1,253 | $ | 58 | $ | 28,003 | $ | (14,676 | ) | $ | (2,431 | ) | $ | (4,128 | ) | $ | 6,827 | $ | 7 | $ | 6,834 | ||||||||||||||||
| * | Represents an amount less than $0.5 million. |
| ** | In connection with the sale of Teva’s business venture in Japan. See note 17. |
Teva shareholders’ equity |
||||||||||||||||||||||||||||||||||||
Ordinary shares |
||||||||||||||||||||||||||||||||||||
Number of shares (in millions) |
Stated value |
Additional paid-in capital
|
Retained earnings (accumulated deficit) |
Accumulated other comprehensive (loss) |
Treasury shares |
Total Teva shareholders’ equity |
Non- controlling interests |
Total equity |
||||||||||||||||||||||||||||
(U.S. dollars in millions) |
||||||||||||||||||||||||||||||||||||
Balance at March 31, 2024 |
1,238 | 58 | 27,796 | (13,673 | ) | (2,775 | ) | (4,128 | ) | 7,278 | 265 | 7,543 | ||||||||||||||||||||||||
Net Income (loss) |
(846 | ) | (846 | ) | (29 | ) | (874 | ) | ||||||||||||||||||||||||||||
Other comprehensive income (loss) |
(106 | ) | (106 | ) | (32 | ) | (138 | ) | ||||||||||||||||||||||||||||
Issuance of shares |
* | * | * | * | ||||||||||||||||||||||||||||||||
Stock-based compensation expense |
32 | 32 | 32 | |||||||||||||||||||||||||||||||||
Balance at June 30, 2024 |
1,239 | $ | 58 | $ | 27,829 | $ | (14,519 | ) | $ | (2,881 | ) | $ | (4,128 | ) | $ | 6,359 | $ | 204 | $ | 6,563 | ||||||||||||||||
| * | Represents an amount less than 0.5 million. |
Teva shareholders’ equity |
||||||||||||||||||||||||||||||||||||
Ordinary shares |
||||||||||||||||||||||||||||||||||||
Number of shares (in millions) |
Stated value |
Additional paid-in capital
|
Retained earnings (accumulated deficit) |
Accumulated other comprehensive (loss) |
Treasury shares |
Total Teva shareholders’ equity |
Non- controlling interests |
Total equity |
||||||||||||||||||||||||||||
(U.S. dollars in millions) |
||||||||||||||||||||||||||||||||||||
Balance at December 31, 2023 |
1,227 |
57 |
27,807 |
(13,534 |
) |
(2,697 |
) |
(4,128 |
) |
7,506 |
620 |
8,126 |
||||||||||||||||||||||||
Net Income (loss) |
(985 |
) |
(985 |
) |
(309 |
) |
(1,294 |
) |
||||||||||||||||||||||||||||
Other comprehensive income (loss) |
(181 |
) |
(181 |
) |
(74 |
) |
(255 |
) |
||||||||||||||||||||||||||||
Issuance of Shares |
12 |
1 |
* |
1 |
1 |
|||||||||||||||||||||||||||||||
Stock-based compensation expense |
60 |
60 |
60 |
|||||||||||||||||||||||||||||||||
Proceeds from exercise of options |
6 |
6 |
6 |
|||||||||||||||||||||||||||||||||
Dividend to non-controlling interest ** |
(18 |
) |
(18 |
) |
||||||||||||||||||||||||||||||||
Purchase of shares from non-controlling interests*** |
(45 |
) |
(3 |
) |
(48 |
) |
(16 |
) |
(64 |
) |
||||||||||||||||||||||||||
Balance at June 30, 2024 |
1,239 |
$ |
58 |
$ |
27,829 |
$ |
(14,519 |
) |
$ |
(2,881 |
) |
$ |
(4,128 |
) |
$ |
6,359 |
$ |
204 |
$ |
6,563 |
||||||||||||||||
| * | Represents an amount less than $0.5 million. |
| ** | In connection with dividends to non-controlling interests in Teva’s business venture in Japan. |
| *** | Purchase of shares from non-controlling interests in a Teva’s subsidiary in Switzerland. |
Three months ended June 30, |
Six months ended June 30, |
|||||||||||||||
2025 |
2024 |
2025 |
2024 |
|||||||||||||
Operating activities: |
||||||||||||||||
Net income (loss) |
$ | 283 | (874 | ) | $ | 503 | (1,294 | ) | ||||||||
Adjustments to reconcile net income (loss) to net cash provided by operations: |
||||||||||||||||
Depreciation and amortization |
251 | 259 | 494 | 531 | ||||||||||||
Impairment of goodwill |
— | 400 | — | 400 | ||||||||||||
Impairment of long-lived assets and assets held for sale |
99 | 130 | 177 | 809 | ||||||||||||
Net change in operating assets and liabilities |
(336 | ) | (10 | ) | (1,035 | ) | (507 | ) | ||||||||
Deferred income taxes – net and uncertain tax positions |
(211 | ) | (424 | ) | (183 | ) | (613 | ) | ||||||||
Stock-based compensation |
38 | 32 | 72 | 60 | ||||||||||||
Other items* |
105 | 592 | 94 | 594 | ||||||||||||
Net loss (gain) from sale of business and long-lived assets |
(2 | ) | (1 | ) | — | (1 | ) | |||||||||
Net cash provided by (used in) operating activities |
227 | 103 | 122 | (21 | ) | |||||||||||
Investing activities: |
||||||||||||||||
Beneficial interest collected in exchange for securitized trade receivables |
336 | 317 | 658 | 612 | ||||||||||||
Purchases of property, plant and equipment and intangible assets |
(96 | ) | (97 | ) | (223 | ) | (221 | ) | ||||||||
Proceeds from sale of business and long-lived assets, net |
9 | 1 | 26 | 1 | ||||||||||||
Acquisition of businesses, net of cash acquired |
— | — | — | (15 | ) | |||||||||||
Purchases of investments and other assets |
(16 | ) | (43 | ) | (27 | ) | (55 | ) | ||||||||
Other investing activities |
3 | — | 3 | — | ||||||||||||
Net cash provided by (used in) investing activities |
236 | 178 | 437 | 322 | ||||||||||||
Financing activities: |
||||||||||||||||
Repayment of senior notes and loans and other long-term liabilities |
(2,300 | ) | (956 | ) | (3,668 | ) | (956 | ) | ||||||||
Proceeds from senior notes, net of issuance costs |
2,305 | — | 2,305 | — | ||||||||||||
Purchase of shares from redeemable and non-redeemable non-controlling interests |
— | — | (38 | ) | (64 | ) | ||||||||||
Dividends paid to redeemable and non-redeemable non-controlling interests |
— | — | (340 | ) | (78 | ) | ||||||||||
Other financing activities |
1 | (10 | ) | 3 | (19 | ) | ||||||||||
Net cash provided by (used in) financing activities |
6 | (966 | ) | (1,738 | ) | (1,117 | ) | |||||||||
Translation adjustment on cash and cash equivalents |
(5 | ) | (49 | ) | 40 | (153 | ) | |||||||||
Net change in cash and cash equivalents |
464 | (733 | ) | (1,139 | ) | (969 | ) | |||||||||
Balance of cash, cash equivalents at beginning of period |
1,697 | 2,991 | 3,300 | 3,227 | ||||||||||||
Balance of cash, cash equivalents at end of period |
$ | 2,161 | 2,258 | $ | 2,161 | 2,258 | ||||||||||
Non-cash financing and investing activities: |
||||||||||||||||
Beneficial interest obtained in exchange for securitized accounts receivables |
$ | 329 | 320 | $ | 641 | 632 | ||||||||||
* |
Adjustment in the three months period ended June 30, 2024 was mainly related to an agreement with the Israeli Tax Authorities. See note 11. |
a. |
Basis of presentation |
b. |
Significant accounting policies |
June 30, |
December 31, |
|||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
||||||||
| Accounts receivables |
$ | 118 | 222 | |||||
| Inventories |
520 | $ | 647 | |||||
| Property, plant and equipment, net and others |
955 | 913 | ||||||
| Identifiable intangible assets, net |
21 | 83 | ||||||
| Goodwill |
207 | 255 | ||||||
| Other current assets |
107 | 99 | ||||||
| Other non-current assets |
198 | 236 | ||||||
| Expected loss on sale* |
(284 | ) | (684 | ) | ||||
| |
|
|
|
|||||
| Total assets of the disposal group classified as held for sale in the consolidated balance sheets |
$ | 1,842 | $ | 1,771 | ||||
| |
|
|
|
|||||
| Accounts payables |
(235 | ) | (283 | ) | ||||
| Other current liabilities |
(21 | ) | (49 | ) | ||||
| Other non-current liabilities |
(78 | ) | (85 | ) | ||||
| Expected loss on sale* |
— | (281 | ) | |||||
| |
|
|
|
|||||
| Total liabilities of the disposal group classified as held for sale in the consolidated balance sheets |
$ | (334 | ) | $ | (698 | ) | ||
| |
|
|
|
|||||
* |
Includes an expected loss from reclassification of currency translation adjustments to the consolidated statements of income (loss) upon sale. |
Three months ended June 30, 2025 |
||||||||||||||||||||
United States |
Europe |
International Markets |
Other activities |
Total |
||||||||||||||||
(U.S.$ in millions) |
||||||||||||||||||||
| Sale of goods |
1,755 | 1,275 | 469 | 136 | 3,636 | |||||||||||||||
| Licensing arrangements |
29 | 9 | 9 | (1 | ) | 46 | ||||||||||||||
| Distribution |
365 | § | 12 | — | 377 | |||||||||||||||
| Other |
2 | 13 | 5 | 98 | 117 | |||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| $ | 2,151 | $ | 1,298 | $ | 495 | $ | 232 | $ | 4,176 | |||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| § | Represents an amount less than $ 0.5 million. |
Three months ended June 30, 2024 |
||||||||||||||||||||
United States |
Europe |
International Markets |
Other activities |
Total |
||||||||||||||||
(U.S.$ in millions) |
||||||||||||||||||||
| Sale of goods |
1,714 | 1,203 | 574 | 150 | 3,640 | |||||||||||||||
| Licensing arrangements |
23 | 6 | 6 | 1 | 36 | |||||||||||||||
| Distribution |
373 | § | 9 | — | 382 | |||||||||||||||
| Other |
§ | 3 | 4 | 99 | 106 | |||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| $ | 2,110 | $ | 1,213 | $ | 593 | $ | 249 | $ | 4,164 | |||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| § | Represents an amount less than $ 0.5 million. |
Six months ended June 30, 2025 |
||||||||||||||||||||
United States |
Europe |
International Markets |
Other activities |
Total |
||||||||||||||||
(U.S.$ in millions) |
||||||||||||||||||||
| Sale of goods |
3,270 | 2,473 | 1,023 | 265 | 7,031 | |||||||||||||||
| Licensing arrangements |
50 | 16 | 16 | § | 82 | |||||||||||||||
| Distribution |
738 | § | 22 | — | 760 | |||||||||||||||
| Other |
2 | 2 | 17 | 173 | 194 | |||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| $ | 4,060 | $ | 2,492 | $ | 1,077 | $ | 438 | $ | 8,067 | |||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| § | Represents an amount less than $ 0.5 million. |
Six months ended June 30, 2024 |
||||||||||||||||||||
United States |
Europe |
International Markets |
Other activities |
Total |
||||||||||||||||
(U.S.$ in millions) |
||||||||||||||||||||
| Sale of goods |
3,034 | 2,455 | 1,140 | 277 | 6,907 | |||||||||||||||
| Licensing arrangements |
45 | 18 | 11 | 1 | 75 | |||||||||||||||
| Distribution |
754 | 1 | 18 | — | 773 | |||||||||||||||
| Other |
1 | 12 | 20 | 195 | 228 | |||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| $ | 3,835 | $ | 2,485 | $ | 1,190 | $ | 474 | $ | 7,983 | |||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
Sales Reserves and Allowances |
||||||||||||||||||||||||||||||||
Reserves included in Accounts Receivable, net |
Rebates |
Medicaid and other governmental allowances |
Chargebacks |
Returns |
Other |
Total reserves included in Sales Reserves and Allowances |
Total |
|||||||||||||||||||||||||
(U.S.$ in millions) |
||||||||||||||||||||||||||||||||
| Balance at January 1, 2025 |
$ |
56 |
$ |
1,674 |
$ |
561 |
$ |
936 |
$ |
399 |
$ |
108 |
$ |
3,678 |
$ |
3,734 |
||||||||||||||||
| Provisions related to sales made in current year period |
203 |
2,520 |
486 |
4,034 |
143 |
73 |
7,256 |
7,459 |
||||||||||||||||||||||||
| Provisions related to sales made in prior periods |
— |
(46 |
) |
30 |
(28 |
) |
(1 |
) |
(7 |
) |
(52 |
) |
(52 |
) | ||||||||||||||||||
| Credits and payments |
(194 |
) |
(2,363 |
) |
(468 |
) |
(3,962 |
) |
(112 |
) |
(48 |
) |
(6,953 |
) |
(7,147 |
) | ||||||||||||||||
| Translation differences |
— |
64 |
17 |
18 |
5 |
17 |
121 |
121 |
||||||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Balance at June 30, 2025 |
$ |
65 |
$ |
1,849 |
$ |
626 |
$ |
998 |
$ |
434 |
$ |
143 |
$ |
4,050 |
$ |
4,115 |
||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Sales Reserves and Allowances |
||||||||||||||||||||||||||||||||
Reserves included in Accounts Receivable, net |
Rebates |
Medicaid and other governmental allowances |
Chargebacks |
Returns |
Other |
Total reserves included in Sales Reserves and Allowances |
Total |
|||||||||||||||||||||||||
(U.S.$ in millions) |
||||||||||||||||||||||||||||||||
| Balance at January 1, 2024 |
$ |
61 |
$ |
1,603 |
$ |
540 |
$ |
859 |
$ |
436 |
$ |
97 |
$ |
3,535 |
$ |
3,596 |
||||||||||||||||
| Provisions related to sales made in current year period |
194 |
2,325 |
382 |
3,950 |
146 |
81 |
6,896 |
7,084 |
||||||||||||||||||||||||
| Provisions related to sales made in prior periods |
— |
12 |
26 |
(11 |
) |
(17 |
) |
(1 |
) |
9 |
9 |
|||||||||||||||||||||
| Credits and payments |
(184 |
) |
(2,183 |
) |
(376 |
) |
(3,923 |
) |
(129 |
) |
(82 |
) |
(6,705 |
) |
(6,884 |
) | ||||||||||||||||
| Translation differences |
— |
(19 |
) |
(4 |
) |
(6 |
) |
(4 |
) |
(2 |
) |
(35 |
) |
(35 |
) | |||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Balance at June 30, 2024 |
$ |
70 |
$ |
1,738 |
$ |
568 |
$ |
869 |
$ |
432 |
$ |
93 |
$ |
3,700 |
$ |
3,770 |
||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
June 30, |
December 31, |
|||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
||||||||
Finished products |
$ | 2,106 | $ | 1,783 | ||||
Raw and packaging materials |
724 | 671 | ||||||
Products in process |
392 | 353 | ||||||
Materials in transit and payments on account |
276 | 199 | ||||||
| $ | 3,497 | $ | 3,007 | |||||
Gross carrying amount net of impairment |
Accumulated amortization |
Net carrying amount |
||||||||||||||||||||||
June 30, 2025 |
December 31, 2024 |
June 30, 2025 |
December 31, 2024 |
June 30, 2025 |
December 31, 2024 |
|||||||||||||||||||
(U.S. $ in millions) |
||||||||||||||||||||||||
Product rights |
$ | 16,399 | $ | 15,915 | $ | 12,743 | $ | 11,998 | $ | 3,656 | $ | 3,917 | ||||||||||||
Trade names |
595 | 568 | 322 | 300 | 273 | 268 | ||||||||||||||||||
In process research and development |
213 | 233 | — | — | 213 | 233 | ||||||||||||||||||
Total |
$ | 17,207 | $ | 16,716 | $ | 13,065 | $ | 12,298 | $ | 4,142 | $ | 4,418 | ||||||||||||
| (a) | Identifiable product rights of $40 million due to: (i) $25 million mainly related to updated market assumptions regarding price and volume of products mainly in Europe , and (ii) $15 million mainly related to a change in Teva’s commercial plan regarding certain products as part of its optimization efforts, mainly in the U.S.; and |
| (b) | IPR&D assets of $2 million, mainly related to generic pipeline products resulting from development progress and changes in other key valuation indications mainly in Europe and the U.S. (e.g., market size, competition assumptions, legal landscape and launch date). |
| (a) | Identifiable product rights of $51 million, mainly due to updated market assumptions regarding price and volume of products mainly in the U.S.; and |
| (b) | IPR&D assets of $10 million, mainly related to generic pipeline products resulting from development progress and changes in other key valuation indications (e.g., market size, competition assumptions, legal landscape and launch date). |
| (a) | Identifiable product rights of $153 million due to: (i) $87 million mainly related to a change in Teva’s commercial plan regarding certain products as part of its optimization efforts, mainly in the U.S., and (ii) $66 million mainly related to updated market assumptions regarding price and volume of products in Europe; and |
| (b) | IPR&D assets of $10 million, mainly related to generic pipeline products resulting from development progress and changes in other key valuation indications mainly in the U.S. (e.g., market size, competition assumptions, legal landscape and launch date). |
| (a) | Identifiable product rights of $108 million, mainly due to updated market assumptions regarding price and volume of products mainly in the U.S.; and |
| (b) | IPR&D assets of $33 million, mainly related to generic pipeline products resulting from development progress and changes in other key valuation indications mainly in the U.S. (e.g., market size, competition assumptions, legal landscape and launch date). |
United States |
Europe |
International Markets |
Other |
Total |
||||||||||||||||||||
Teva’s API |
Medis |
|||||||||||||||||||||||
(U.S. $ in millions) |
||||||||||||||||||||||||
| Balance as of December 31, 2024 (1) |
$ | 5,732 | $ | 8,075 | $ | 1,110 | $ | — | $ | 232 | $ | 15,147 | ||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Other changes during the period: |
||||||||||||||||||||||||
| Translation differences and other |
— | 731 | 12 | — | 59 | 802 | ||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Balance as of June 30, 2025 (1) |
$ | 5,732 | $ | 8,806 | $ | 1,122 | $ | — | $ | 291 | $ | 15,949 | ||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| (1) | Cumulative goodwill impairment as of June 30, 2025 and December 31, 2024, was each approximately $29.6 billion. |
a. |
Short-term debt: |
Interest rate as of June 30, 2025 |
Maturity |
June 30, 2025 |
December 31, 2024 |
|||||||||||||
(U.S. $ in millions) |
||||||||||||||||
| Convertible senior debentures |
0.25% | 2026 | 23 | 23 | ||||||||||||
| Current maturities of long-term liabilities and other |
441 | 1,758 | ||||||||||||||
| |
|
|
|
|||||||||||||
| Total short-term debt |
$ | 464 | $ | 1,781 | ||||||||||||
| |
|
|
|
|||||||||||||
b. |
Long-term debt: |
Interest rate as of June 30, 2025 |
Maturity |
June 30, 2025 |
December 31, 2024 |
|||||||||||||
(U.S. $ in millions) |
||||||||||||||||
| Senior notes EUR 1,000 million (4) |
6.00 | % | 2025 | — | 429 | |||||||||||
| Senior notes USD 1,000 million (5) |
7.13 | % | 2025 | — | 427 | |||||||||||
| Senior notes EUR 900 million (6) |
4.50 | % | 2025 | — | 515 | |||||||||||
| Senior notes CHF 350 million |
1.00 | % | 2025 | 438 | 387 | |||||||||||
| Senior notes USD 3,500 million (10) |
3.15 | % | 2026 | 1,798 | 3,374 | |||||||||||
| Senior notes EUR 700 million |
1.88 | % | 2027 | 820 | 730 | |||||||||||
| Sustainability-linked senior notes USD 1,000 million (1)(*)(10) |
4.75 | % | 2027 | 649 | 1,000 | |||||||||||
| Sustainability-linked senior notes EUR 1,100 million (1)(*) |
3.75 | % | 2027 | 1,289 | 1,144 | |||||||||||
| Senior notes USD 1,250 million |
6.75 | % | 2028 | 1,250 | 1,250 | |||||||||||
| Senior notes EUR 750 million |
1.63 | % | 2028 | 876 | 778 | |||||||||||
| Sustainability-linked senior notes USD 1,000 million (2)(*) |
5.13 | % | 2029 | 1,000 | 1,000 | |||||||||||
| Sustainability-linked senior notes USD 600 million (3)(*)(10) |
7.88 | % | 2029 | 398 | 600 | |||||||||||
| Sustainability-linked senior notes EUR 800 million (3)(*)(10) |
7.38 | % | 2029 | 775 | 835 | |||||||||||
| Sustainability-linked senior notes EUR 1,500 million (2)(*) |
4.38 | % | 2030 | 1,756 | 1,562 | |||||||||||
| Senior notes USD 700 million (7) |
5.75 | % | 2030 | 696 | — | |||||||||||
| Sustainability-linked senior notes USD 500 million (3)(*) |
8.13 | % | 2031 | 500 | 500 | |||||||||||
| Sustainability-linked senior notes EUR 500 million (3)(*) |
7.88 | % | 2031 | 585 | 521 | |||||||||||
| Senior notes EUR 1,000 million (8) |
4.13 | % | 2031 | 1,164 | — | |||||||||||
| Senior notes USD 500 million (9) |
6.00 | % | 2032 | 496 | — | |||||||||||
| Senior notes USD 789 million |
6.15 | % | 2036 | 783 | 783 | |||||||||||
| Senior notes USD 2,000 million |
4.10 | % | 2046 | 1,986 | 1,986 | |||||||||||
| |
|
|
|
|||||||||||||
| Total senior notes |
|
17,259 | 17,821 | |||||||||||||
| Less current maturities |
|
(438 |
)
|
(1,758 | ) | |||||||||||
| Less debt issuance costs (11) |
|
(58 | ) | (61 | ) | |||||||||||
| |
|
|
|
|||||||||||||
| Total senior notes and loans |
|
$ | 16,763 | $ | 16,002 | |||||||||||
| |
|
|
|
|||||||||||||
| (1) | If Teva fails to achieve certain sustainability performance targets, a one-time premium payment of 0.15%-0.45% out of the principal amount will be paid at maturity or upon earlier redemption, if such redemption is on or after May 9, 2026. |
| (2) | If Teva fails to achieve certain sustainability performance targets, the interest rate shall increase by 0.125%-0.375% per annum, from and including May 9, 2026. |
| (3) | If Teva fails to achieve certain sustainability performance targets, the interest rate shall increase by 0.100%-0.300% per annum, from and including September 15, 2026. |
| (4) | In January 2025, Teva repaid $426 million of its 6.00% senior notes due 2025 at maturity. |
| (5) | In January 2025, Teva repaid $427 million of its 7.13% senior notes due 2025 at maturity. |
| (6) | In March 2025, Teva repaid $515 million of its 4.50% senior notes due 2025 at maturity. |
| (7) | In May 2025, Teva issued senior notes in an aggregate principal amount of $700 million bearing 5.75% annual interest and due December 2030. |
| (8) | In May 2025, Teva issued senior notes in an aggregate principal amount of € 1,000 million bearing 4.125% annual interest and due June 2031. |
| (9) | In May 2025, Teva issued senior notes in an aggregate principal amount of $500 million bearing 6.00% annual interest and due December 2032. |
| (10) | In June 2025, Teva consummated a cash tender offer and extinguished $1,579 million aggregate principal amount of its 3.15% senior notes due 2026; $ 351 million aggregate principal amount of its 4.75% senior notes due 2027; $ 202 million aggregate principal amount of its 7.88% senior notes due in 2029; and $ 157 million aggregate principal amount of its 7.38% senior notes due in 2029. The extinguishment resulted in a loss of $ 10million which was recorded under financial expenses, net. |
| (11) | Debt issuance costs as of June 30, 2025 include $13 million in connection with the issuance of the senior notes in May 2025, partially offset by $6 million acceleration of issuance costs related to the cash tender offer . |
| (12) | In July 2025, Teva repaid $444 million of its 1% senior notes due 2025 at maturity. |
* |
Interest rate adjustments and a potential one-time premium payment related to the sustainability-linked bonds are treated as bifurcated embedded derivatives. See note 8c. |
a. |
Foreign exchange risk management: |
b. |
Interest risk management: |
c. |
Bifurcated embedded derivatives: |
Fair value |
Fair value |
|||||||||||||||
|
Designated as hedging instruments |
Not designated as hedging instruments |
|||||||||||||||
|
June 30, 2025 |
December 31, 2024 |
June 30, 2025 |
December 31, 2024 |
|||||||||||||
| Reported under |
(U.S. $ in millions) |
(U.S. $ in millions) |
||||||||||||||
| Asset derivatives: |
||||||||||||||||
| Other current assets: |
||||||||||||||||
| Option and forward contracts |
$ | — | $ | — | $ | 71 | $ | 71 | ||||||||
| Liability derivatives: |
||||||||||||||||
| Other current liabilities: |
||||||||||||||||
| Option and forward contracts |
— | — | (50 | ) | (24 | ) | ||||||||||
| Other non-current liabilities: |
||||||||||||||||
| Cross-currency interest rate swap-cash flow hedge (1) |
(19 | ) | — | — | — | |||||||||||
Financial expenses, net |
Other comprehensive income (loss) |
|||||||||||||||
Three months ended, |
Three months ended, |
|||||||||||||||
June 30, 2025 |
June 30, 2024 |
June 30, 2025 |
June 30, 2024 |
|||||||||||||
Reported under |
(U.S. $ in millions) |
|||||||||||||||
| Line items in which effects of hedges are recorded |
$ |
252 |
$ |
241 |
$ |
244 |
$ |
(138 |
) | |||||||
| Cross-currency interest rate swap - cash flow hedge (1) |
17 | — | 1 | — | ||||||||||||
Financial expenses, net |
Other comprehensive income (loss) |
|||||||||||||||
Six months ended, |
Six months ended, |
|||||||||||||||
June 30, 2025 |
June 30, 2024 |
June 30, 2025 |
June 30, 2024 |
|||||||||||||
Reported under |
(U.S. $ in millions) |
|||||||||||||||
| Line items in which effects of hedges are recorded |
$ |
477 |
$ |
491 |
$ |
744 |
$ |
(255 |
) | |||||||
| Cross-currency interest rate swap - cash flow hedge (1) |
17 | (8 | ) | 1 | 1 | |||||||||||
Financial expenses, net |
Net revenues |
|||||||||||||||
Three months ended, |
Three months ended, |
|||||||||||||||
June 30, 2025 |
June 30, 2024 |
June 30, 2025 |
June 30, 2024 |
|||||||||||||
Reported under |
(U.S. $ in millions) |
|||||||||||||||
| Line items in which effects of hedges are recorded |
$ |
252 |
$ |
241 |
$ |
(4,176 |
) |
$ |
(4,164 |
) | ||||||
| Option and forward contracts (2) |
(58 | ) | (27 | ) | — | — | ||||||||||
| Option and forward contracts economic hedge (3) |
— | — | 32 | 2 | ||||||||||||
Financial expenses, net |
Net revenues |
|||||||||||||||
Six months ended, |
Six months ended, |
|||||||||||||||
June 30, 2025 |
June 30, 2024 |
June 30, 2025 |
June 30, 2024 |
|||||||||||||
| Reported under |
(U.S. $ in millions) |
|||||||||||||||
| Line items in which effects of hedges are recorded |
$ |
477 |
$ |
491 |
$ |
(8,067 |
) |
$ |
(7,983 |
) | ||||||
| Option and forward contracts (2) |
4 | (37 | ) | — | — | |||||||||||
| Option and forward contracts economic hedge (3) |
— | — | 60 | (10 | ) | |||||||||||
| (1) | In May 2025, Teva entered into a $ 500million notional amount of fixed to fixed cross-currency interest rate swaps relating to its 5.75% senior notes due 2030 to hedge the foreign currency exchange risk of future principal and interest payments associated with the USD denominated notes. The cross-currency swaps synthetically convert part of the USD debt into CHF, aligning debt servicing costs with Teva’s inflows and reducing economic volatility. These swaps have been designated as cash flow hedges and the gain or loss on these swaps will be reported as a component of other comprehensive income and reclassified into earnings in each period during which the swaps affect earnings in the same line item associated with the USD denominated bonds. |
| (2) | Teva uses foreign exchange contracts (mainly option and forward contracts) to hedge balance sheet items from currency exposure. These foreign exchange contracts are not designated as hedging instruments for accounting purposes. In connection with these foreign exchange contracts, Teva recognizes gains or losses that offset the revaluation of the balance sheet items also recorded under financial expenses, net. |
| (3) | Teva entered into option and forward contracts designed to limit the exposure of foreign exchange fluctuations on projected revenues and expenses recorded in euro, Swiss franc, British pound, Russian ruble, Canadian dollar, Polish złoty , Japanese yen, new Israeli shekel, Indian rupee and some other currencies to protect its projected operating results for 2025. These derivative instruments do not meet the criteria for hedge accounting, however, they are accounted for as an economic hedge. These derivative instruments, which may include hedging transactions against future projected revenues and expenses, are recognized on the balance sheet at their fair value on a quarterly basis, while the foreign exchange impact on the underlying revenues and expenses may occur in subsequent quarters. In the three months ended June 30, 2025, the negative impact from these derivatives recognized under revenues was $32 million. In the three months ended June 30, 2024, the negative impact from these derivatives recognized under was $2 million. In the six months ended June 30, 2025, the negative impact from these derivatives recognized under revenues was $60 million. In the six months ended June 30, 2024, the positive impact from these derivatives recognized under revenues was $10 million. Changes in the fair value of the derivative instruments are recognized in the same line item in the statements of income as the underlying exposure being hedged. Cash flows associated with these derivatives are reflected as cash flows from operating activities in the consolidated statements of cash flows. |
e. |
Amortizations due to terminated derivative instruments: |
f. |
Securitization: |
g. |
Supplier Finance Program Obligation |
Three months ended June 30, |
Six months ended June 30, |
|||||||||||||||
2025 |
2024 |
2025 |
2024 |
|||||||||||||
(U.S. $ in millions) |
(U.S. $ in millions) |
|||||||||||||||
of long-lived (*) |
$ | 58 | $ | 69 | $ | 14 | $ | 668 | ||||||||
Contingent consideration |
19 | 192 | 30 | 271 | ||||||||||||
Restructuring |
154 | 18 | 168 | 31 | ||||||||||||
Other |
1 | 1 | (1 | ) | (17 | ) | ||||||||||
Total |
$ | 232 | $ | 280 | $ | 210 | $ | 954 | ||||||||
| (*) | Including impairments related to exit and disposal activities. |
Three months ended June 30, |
||||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
||||||||
| Restructuring |
||||||||
| Employee termination |
$ | 151 | $ | 13 | ||||
| Other |
3 | 5 | ||||||
| |
|
|
|
|||||
| Total |
$ | 154 | $ | 18 | ||||
| |
|
|
|
|||||
Six months ended June 30, |
||||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
||||||||
| Restructuring |
||||||||
| Employee termination |
$ | 163 | $ | 20 | ||||
| Other |
5 | 11 | ||||||
| |
|
|
|
|||||
| Total |
$ | 168 | $ | 31 | ||||
| |
|
|
|
|||||
Employee termination costs |
Other |
Total |
||||||||||
(U.S. $ in millions) |
||||||||||||
| Balance as of January 1, 2025 |
$ | (55 | ) | $ | (13 | ) | $ | (68 | ) | |||
| Provision |
(163 | ) | (5 | ) | (168 | ) | ||||||
| Utilization and other* |
50 | 4 | 54 | |||||||||
| |
|
|
|
|
|
|||||||
| Balance as of June 30, 2025 |
$ | (168 | ) | $ | (14 | ) | $ | (182 | ) | |||
| |
|
|
|
|
|
|||||||
Employee termination costs |
Other |
Total |
||||||||||
(U.S. $ in millions) |
||||||||||||
| Balance as of January 1, 2024 |
$ | (75 | ) | $ | (7 | ) | $ | (82 | ) | |||
| Provision |
(20 | ) | (11 | ) | (31 | ) | ||||||
| Utilization and other* |
46 | 12 | 58 | |||||||||
| |
|
|
|
|
|
|||||||
| Balance as of June 30, 2024 |
$ | (49 | ) | $ | (6 | ) | $ | (55 | ) | |||
| |
|
|
|
|
|
|||||||
* |
Includes adjustments for foreign currency translation. |
Net Unrealized Gains (Losses) |
Benefit Plans |
|||||||||||||||
Foreign currency translation adjustments |
Derivative financial instruments |
Actuarial gains (losses) and prior service (costs) credits |
Total |
|||||||||||||
(U.S. $ in millions) |
||||||||||||||||
Balance as of December 31, 2024, net of taxes |
$ | (2,857 | ) | $ | (238 | ) | $ | (52 | ) | $ | (3,148 | ) | ||||
Other comprehensive income (loss) before reclassifications |
558 | — | — | 558 | ||||||||||||
Amounts reclassified to the statements of income |
— | 24 | (1 | ) | 23 | |||||||||||
Release of cumulative translation adjustments** |
181 | — | — | 181 | ||||||||||||
Net other comprehensive income (loss) before tax |
739 | 24 | (1 | ) | 762 | |||||||||||
Corresponding income tax |
45 | — | — | 45 | ||||||||||||
Net other comprehensive income (loss) after tax* |
694 | 24 | (1 | ) | 717 | |||||||||||
Balance as of June 30, 2025, net of taxes |
$ | (2,163 | ) | $ | (214 | ) | $ | (53 | ) | $ | (2,431 | ) | ||||
| * | Amounts do not include a $27 million gain from foreign currency translation adjustments attributable to redeemable and non-redeemable non-controlling interests. |
| ** | In connection with the sale of Teva’s business venture in Japan. |
Net Unrealized Gains (Losses) |
Benefit Plans |
|||||||||||||||
Foreign currency translation adjustments |
Derivative financial instruments |
Actuarial gains (losses) and prior service (costs) credits |
Total |
|||||||||||||
(U.S. $ in millions) |
||||||||||||||||
Balance as of December 31, 2023, net of taxes |
$ | (2,384 | ) | $ | (266 | ) | $ | (46 | ) | $ | (2,697 | ) | ||||
Other comprehensive income (loss) before reclassifications |
(205 | ) | — | 1 | (204 | ) | ||||||||||
Amounts reclassified to the statements of income |
— | 14 | (2 | ) | 12 | |||||||||||
Net other comprehensive income (loss) before tax |
(205 | ) | 14 | (1 | ) | (192 | ) | |||||||||
Corresponding income tax |
8 | — | — | 8 | ||||||||||||
Net other comprehensive income (loss) after tax* |
(197 | ) | 14 | (1 | ) | (184 | ) | |||||||||
Balance as of June 30, 2024, net of taxes |
$ | (2,581 | ) | $ | (252 | ) | $ | (47 | ) | $ | (2,881 | ) | ||||
| * | Amounts do not include a $74 million loss from foreign currency translation adjustments attributable to non-controlling interests. |
| (a) | United States segment. |
| (b) | Europe segment, which includes the European Union, the United Kingdom and certain other European countries. |
| (c) | International Markets segment, which includes all countries other than the United States and countries included in the Europe segment. |
a. |
Segment information: |
Three months ended June 30, |
||||||||||||
2025 |
||||||||||||
United States |
Europe |
International Markets |
||||||||||
(U.S. $ in millions) |
||||||||||||
Revenues |
$ | 2,151 | $ | 1,298 | $ | 495 | ||||||
Cost of sales |
901 | 581 | 251 | |||||||||
R&D expenses |
152 | 59 | 24 | |||||||||
S&M expenses |
279 | 228 | 114 | |||||||||
G&A expenses |
113 | 66 | 32 | |||||||||
Other |
§ | § | (1 | ) | ||||||||
Segment profit |
$ | 706 | $ | 364 | $ | 74 | ||||||
§ |
Represents an amount less than $0.5 million .
|
Three months ended June 30, |
||||||||||||
2024 |
||||||||||||
United States |
Europe |
International Markets |
||||||||||
(U.S. $ in millions) |
||||||||||||
Revenues |
$ | 2,110 | $ | 1,213 | $ | 593 | ||||||
Cost of sales |
943 | 536 | 307 | |||||||||
R&D expenses |
170 | 62 | 30 | |||||||||
S&M expenses |
270 | 209 | 145 | |||||||||
G&A expenses |
100 | 64 | 38 | |||||||||
Other |
(1 | ) | § | § | ||||||||
Segment profit |
$ | 629 | $ | 342 | $ | 73 | ||||||
§ |
Represents an amount less than $0.5 million. |
Six months ended June 30, |
||||||||||||
2025 |
||||||||||||
United States |
Europe |
International Markets |
||||||||||
(U.S. $ in millions) |
||||||||||||
Revenues |
$ | 4,060 | $ | 2,492 | $ | 1,077 | ||||||
Cost of sales |
1,752 | 1,117 | 556 | |||||||||
R&D expenses |
306 | 120 | 49 | |||||||||
S&M expenses |
552 | 427 | 232 | |||||||||
G&A expenses |
208 | 135 | 72 | |||||||||
Other |
3 | § | (2 | ) | ||||||||
Segment profit |
$ | 1,239 | $ | 693 | $ | 171 | ||||||
§ |
Represents an amount less than $0.5 million. |
Six months ended June 30, |
||||||||||||
2024 |
||||||||||||
United States |
Europe |
International Markets |
||||||||||
(U.S. $ in millions) |
||||||||||||
Revenues |
$ | 3,835 | $ | 2,485 | $ | 1,190 | ||||||
Cost of sales |
1,809 | 1,070 | 607 | |||||||||
R&D expenses |
324 | 118 | 58 | |||||||||
S&M expenses |
530 | 403 | 263 | |||||||||
G&A expenses |
193 | 130 | 73 | |||||||||
Other |
(1 | ) | § | (1 | ) | |||||||
Segment profit |
$ | 979 | $ | 764 | $ | 190 | ||||||
§ |
Represents an amount less than $0.5 million. |
Three months ended June 30, |
Six months ended June 30, |
|||||||||||||||
2025 |
2024 |
2025 |
2024 |
|||||||||||||
(U.S. $ in millions) |
(U.S. $ in millions) |
|||||||||||||||
United States profit |
$ | 706 | $ | 629 | $ | 1,239 | $ | 979 | ||||||||
Europe profit |
364 | 342 | 693 | 764 | ||||||||||||
International Markets profit |
74 | 73 | 171 | 190 | ||||||||||||
Total reportable segments profit |
1,144 | 1,043 | 2,102 | 1,933 | ||||||||||||
Profit (loss) of other activities |
(11 | ) |
12 | (23 | ) |
15 | ||||||||||
Amounts not allocated to segments: |
||||||||||||||||
Amortization |
148 | 146 | 292 | 298 | ||||||||||||
Other assets impairments, restructuring and other items |
232 | 280 | 210 | 954 | ||||||||||||
Goodwill impairment |
— | 400 | — | 400 | ||||||||||||
Intangible assets impairments |
42 | 61 | 163 | 141 | ||||||||||||
Legal settlements and loss contingencies |
166 | 83 | 249 | 188 | ||||||||||||
Other unallocated amounts |
91 | 91 | 190 | 190 | ||||||||||||
Consolidated operating income (loss) |
455 | (5 | ) | 975 | (223 | ) | ||||||||||
Financial expenses, net |
252 | 241 | 477 | 491 | ||||||||||||
Consolidated income (loss) before income taxes |
$ | 203 | $ | (246 | ) | $ | 497 | $ | (713 | ) | ||||||
| United States |
Three months ended June 30, |
|||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
||||||||
Generic products (including biosimilars) |
$ | 961 | $ | 1,023 | ||||
AJOVY ®
|
63 | 42 | ||||||
AUSTEDO |
495 | 407 | ||||||
BENDEKA ® and TREANDA®
|
40 | 41 | ||||||
COPAXONE |
62 | 81 | ||||||
UZEDY |
54 | 24 | ||||||
Anda |
365 | 373 | ||||||
Other |
111 | 119 | ||||||
Total |
$ | 2,151 | $ | 2,110 | ||||
| United States |
Six months ended June 30, |
|||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
||||||||
Generic products (including biosimilars) |
$ | 1,809 | $ | 1,831 | ||||
AJOVY |
117 | 87 | ||||||
AUSTEDO |
891 | 689 | ||||||
BENDEKA and TREANDA |
76 | 87 | ||||||
COPAXONE |
116 | 111 | ||||||
UZEDY |
93 | 40 | ||||||
Anda |
738 | 754 | ||||||
Other |
220 | 237 | ||||||
Total |
$ | 4,060 | $ | 3,835 | ||||
| Europe |
Three months ended June 30, |
|||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
||||||||
Generic products (including OTC and biosimilars) |
$ | 1,040 | $ | 970 | ||||
AJOVY |
71 | 52 | ||||||
COPAXONE |
50 | 53 | ||||||
Respiratory products |
55 | 57 | ||||||
Other* |
81 | 81 | ||||||
Total |
$ | 1,298 | $ | 1,213 | ||||
* |
Other revenues in the second quarter of 2025 include the sale of certain product rights. |
| Europe |
Six months ended June 30, |
|||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
||||||||
Generic products (including OTC and biosimilars) |
$ | 2,029 | $ | 1,974 | ||||
AJOVY |
129 | 102 | ||||||
COPAXONE |
92 | 110 | ||||||
Respiratory products |
110 | 123 | ||||||
Other* |
132 | 175 | ||||||
Total |
$ | 2,492 | $ | 2,485 | ||||
* |
Other revenues in the first six months of 2025 include the sale of certain product rights. |
International markets |
Three months ended June 30, |
|||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
||||||||
Generic products (including OTC and biosimilars) |
$ |
410 |
$ |
486 |
||||
AJOVY |
20 | 22 | ||||||
AUSTEDO |
3 | 12 | ||||||
COPAXONE |
7 | 14 | ||||||
Other |
55 | 59 | ||||||
Total |
$ |
495 |
$ |
593 |
||||
| International markets |
Six months ended June 30, |
|||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
||||||||
Generic products (including OTC and biosimilars) |
$ | 878 | $ | 963 | ||||
AJOVY |
48 | 39 | ||||||
AUSTEDO |
18 | 26 | ||||||
COPAXONE |
17 | 25 | ||||||
Other* |
116 | 136 | ||||||
Total |
$ | 1,077 | $ | 1,190 | ||||
* |
Other revenues in the first six months of 2025 include the sale of certain product rights. |
June 30, 2025 |
||||||||||||||||
Level 1 |
Level 2 |
Level 3 |
Total |
|||||||||||||
(U.S. $ in millions) |
||||||||||||||||
| Cash and cash equivalents: |
||||||||||||||||
| Money markets |
$ | 1,360 | $ | — | $ | — | $ | 1,360 | ||||||||
| Cash, deposits and other |
801 | — | — | 801 | ||||||||||||
| Investment in securities: |
||||||||||||||||
| Equity securities |
13 | — | — | 13 | ||||||||||||
| Other |
1 | — | — | 1 | ||||||||||||
| Derivatives: |
||||||||||||||||
| Asset derivatives: |
||||||||||||||||
| Options and forward contracts |
— | 71 | — | 71 | ||||||||||||
| Liability derivatives: |
||||||||||||||||
| Options and forward contracts |
— | (50 | ) | — | (50 | ) | ||||||||||
| Cross currency interest rate swap |
— | (19 | ) | — | (19 | ) | ||||||||||
| Bifurcated embedded derivatives |
— | — | § | — | ||||||||||||
| Contingent consideration* |
— | — | (303 | ) |
(303 | ) | ||||||||||
| |
|
|
|
|
|
|
|
|||||||||
| Total |
$ | 2,175 | $ | 2 | $ | (303 | ) | $ | 1,874 | |||||||
| |
|
|
|
|
|
|
|
|||||||||
December 31, 2024 |
||||||||||||||||
Level 1 |
Level 2 |
Level 3 |
Total |
|||||||||||||
(U.S. $ in millions) |
||||||||||||||||
| Cash and cash equivalents: |
||||||||||||||||
| Money markets |
$ | 2,005 | $ | — | $ | — | $ | 2,005 | ||||||||
| Cash, deposits and other |
1,295 | — | — | 1,295 | ||||||||||||
| Investment in securities: |
||||||||||||||||
| Equity securities |
12 | — | — | 12 | ||||||||||||
| Other |
3 | — | — | 3 | ||||||||||||
| Derivatives: |
||||||||||||||||
| Asset derivatives: |
||||||||||||||||
| Options and forward contracts |
— | 71 | — | 71 | ||||||||||||
| Liability derivatives: |
||||||||||||||||
| Options and forward contracts |
— | (24 | ) | — | (24 | ) | ||||||||||
| Bifurcated embedded derivatives |
— | — | § | — | ||||||||||||
| Contingent consideration* |
$ | — | — | (401 | ) | (401 | ) | |||||||||
| |
|
|
|
|
|
|
|
|||||||||
| Total |
3,315 | $ | 47 | $ | (401 | ) | $ | 2,961 | ||||||||
| |
|
|
|
|
|
|
|
|||||||||
§ |
Represents an amount less than $0.5 million. |
* |
Contingent consideration represents liabilities recorded at fair value in connection with acquisitions. |
Six months ended June 30, 2025 |
Six months ended June 30, 2024 |
|||||||
(U.S. $ in millions) |
||||||||
| Fair value at the beginning of the period |
$ | (401 | ) | (477 | ) | |||
| Bifurcated embedded derivatives |
§ | § | ||||||
| Adjustments to provisions for contingent consideration: |
||||||||
| Allergan transaction |
(21 | ) | (239 | ) | ||||
| Eagle transaction |
(8 | ) | (31 | ) | ||||
| Novetide transaction |
(1 | ) | (1 | ) | ||||
| Settlement of contingent consideration: |
||||||||
| Allergan transaction |
103 | 102 | ||||||
| Eagle transaction |
23 | 28 | ||||||
| Novetide transaction |
2 | 2 | ||||||
| |
|
|
|
|||||
| Fair value at the end of the period |
$ | (303 | ) | $ | (616 | ) | ||
| |
|
|
|
|||||
§ |
Represents an amount less than $0.5 million. |
Estimated fair value* |
||||||||
June 30, 2025 |
December 31, 2024 |
|||||||
(U.S. $ in millions) |
||||||||
| Senior notes and sustainability-linked senior notes included under senior notes and loans |
$ | 16,673 | $ | 15,717 | ||||
| Senior notes and convertible senior debentures included under short-term debt |
460 | 1,779 | ||||||
| |
|
|
|
|||||
| Total |
$ | 17,133 | $ | 17,496 | ||||
| |
|
|
|
|||||
* |
The fair value was estimated based on quoted market prices. |
Redeemable non-controlling
interests |
||||
(U.S. $ in millions) |
||||
| Balance as of December 31, 2024 |
$ | 340 | ||
| |
|
|||
| Changes during the period: |
||||
| Share in comprehensive income (loss) |
33 | |||
| Dividend payment |
(340 | ) | ||
| Purchase of shares from redeemable non-controlling interests |
(38 | ) | ||
| Other adjustments related to redeemable non-controlling interests |
6 | |||
| |
|
|||
| Balance as of June 30, 2025 |
$ | — | ||
| |
|
|||
TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
| ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
Business Overview
We are a leading innovative biopharmaceutical company, enabled by a world-class generics business. For over 120 years, our commitment has never wavered. From innovating in the fields of neuroscience and immunology to providing complex generic medicines, biosimilars and pharmacy brands worldwide.
Today, the Company’s global network of capabilities enables its approximately 37,000 employees across 57 markets to advance health by developing medicines for the future while championing the production of generics and biologics. We are dedicated to addressing patients’ needs, now and in the future.
Teva was incorporated in Israel on February 13, 1944 and is the successor to a number of Israeli corporations, the oldest of which was established in 1901.
Our Business Segments
We operate our business through three segments: United States, Europe and International Markets. Each business segment manages our entire product portfolio in its region, including generics, which includes biosimilars and OTC products, as well as innovative medicines. This structure enables strong alignment and integration between operations, commercial regions, R&D and our global marketing and portfolio function, optimizing our product lifecycle across therapeutic areas.
In addition to these three segments, we have other activities, primarily the sale of API to third parties, certain contract manufacturing services and an out-licensing platform offering a portfolio of products to other pharmaceutical companies through our affiliate Medis.
Pivot to Growth Strategy
In the second quarter of 2025, we continued to execute on the four key pillars of our “Pivot to Growth” strategy, announced in May 2023, and entered into its second phase. During this second phase of “Accelerate Growth,” we expect to focus on growing our innovative portfolio, aligning capital allocation to invest in the highest value activities, and optimizing our organization and operations for cost savings. Under Teva’s Transformation programs announced on May 7, 2025, we expect to achieve such cost savings through a variety of initiatives including examining practices and efficiencies in methods of working, reduction in headcount and optimizing external spend in the following years.
Macroeconomic and Geopolitical Environment
In recent years, the global economy has been impacted by fluctuating foreign exchange rates. In the second quarter of 2025, approximately 45% of our revenues were denominated in currencies other than the U.S. dollar and we manufacture our products largely outside of the United States. Fluctuations in the U.S. dollar versus other currencies in which we operate may materially impact our revenues, results of operations, profits and cash flows. Additionally, in recent years, in many of the markets in which we operate, we experienced higher levels of inflation resulting in higher interest rates, though in certain other markets, such as the EU, we recently experienced a decrease in inflation which resulted in lower interests rates. Although inflationary and other macroeconomic pressures have and may continue to ease, the higher costs we have experienced during recent periods have already impacted our operations and may continue to have an effect on our financial results. The global economy has also been impacted by geopolitical tensions which have resulted in disruptions to global supply chains, including our internal supply chain, as well as ongoing developments regarding international trade policies. The U.S. Government recently announced tariffs on products imported from several jurisdictions in which we operate and source our raw materials from, and has made announcements regarding the potential imposition of tariffs on other jurisdictions. Certain of the announced tariffs have been delayed and we are currently assessing the potential impact on our supply chain and our global operations. However, the U.S. Government may in the future pause, reimpose or increase tariffs, and countries subject to such tariffs have and in the future may impose reciprocal tariffs or other restrictive trade measures in response. Any of these actions could impact our costs and our global operations. Since October 2023, Israel has been in a state of war on multiple fronts involving the Gaza Strip and other countries and regions in the Middle East, including most recently the Islamic Republic of Iran. As of the date of this Quarterly Report on Form 10-Q, this situation remains ongoing. Despite these conditions, our global headquarters as well as several of our manufacturing and R&D facilities are located in Israel and operations there currently remain largely unaffected.
52
Highlights
Significant highlights in the second quarter of 2025 included:
| • | Revenues in the second quarter of 2025 were $4,176 million, flat in U.S. dollars, or a decrease of 1% in local currency terms compared to the second quarter of 2024. This decrease was mainly due to lower revenues from generic products in our International Markets segment associated with the divestment of our business venture in Japan, as well as in our U.S. segment, and a decrease in revenues from COPAXONE, partially offset by an increase in revenues from our key innovative products AUSTEDO, AJOVY and UZEDY. |
| • | Our U.S. segment generated revenues of $2,151 million and segment profit of $706 million in the second quarter of 2025. Revenues increased by 2% and segment profit increased by 12% compared to the second quarter of 2024. |
| • | Our Europe segment generated revenues of $1,298 million and segment profit of $364 million in the second quarter of 2025. Revenues increased by 7% in U.S. dollars, or 3% in local currency terms, compared to the second quarter of 2024. Segment profit increased by 6% compared to the second quarter of 2024. |
| • | Our International Markets segment generated revenues of $495 million and segment profit of $74 million in the second quarter of 2025. Revenues decreased by 17% in U.S. dollars, compared to the second quarter of 2024. In local currency terms revenues decreased by 16%, compared to the second quarter of 2024. Segment profit increased by 1% compared to the second quarter of 2024. |
| • | Our revenues from other activities in the second quarter of 2025 were $232 million. Revenues decreased by 7% in U.S. dollars, or 9% in local currency terms, compared to the second quarter of 2024. |
| • | Exchange rate movements during the second quarter of 2025, net of hedging effects, positively impacted our revenues by $49 million and had a negligible impact on operating income, compared to the second quarter of 2024. |
| • | Gross profit margin was 50.3% in the second quarter of 2025, compared to 48.6% in the second quarter of 2024. |
| • | R&D expenses, net in the second quarter of 2025 were $244 million, a decrease of 9% compared to $269 million in the second quarter of 2024. |
| • | Impairments of identifiable intangible assets were $42 million in the second quarter of 2025, compared to $61 million in the second quarter of 2024. See note 5 to our consolidated financial statements. |
| • | We recorded legal settlements and loss contingencies of $166 million in the second quarter of 2025, compared to $83 million in the second quarter of 2024. See note 9 to our consolidated financial statements. |
| • | Operating income was $455 million in the second quarter of 2025, compared to an operating loss of $5 million in the second quarter of 2024. |
| • | In the second quarter of 2025, we recognized a tax benefit of $78 million, on a pre-tax income of $203 million. In the second quarter of 2024, we recognized a tax expense of $630 million, on a pre-tax loss of $246 million. See note 11 to our consolidated financial statements. |
| • | As of June 30, 2025, our debt was $17,227 million, compared to $17,783 million as of December 31, 2024. See note 7 to our consolidated financial statements. |
| • | Cash flow generated from operating activities during the second quarter of 2025 was $227 million, compared to $103 million of cash flow generated from operating activities in the second quarter of 2024. The higher cash flow generated from operating activities in the second quarter of 2025 resulted mainly from higher profit in our U.S. segment, and a positive impact from accounts receivables, net of SR&A mainly due to collection timing, partially offset by higher sequential inventory levels, as well as higher tax payments. |
| • | During the second quarter of 2025, we generated free cash flow of $476 million, which we define as comprising $227 million in cash flow generated from operating activities, $336 million in beneficial interest collected in exchange for securitized accounts receivables (under our EU securitization program) and $9 million of proceeds from divestitures of businesses and other assets, partially offset by $96 million in cash used for capital investment. During the second quarter of 2024, we generated free cash flow of $324 million. The increase in the second quarter of 2025, resulted mainly from higher cash flow generated from operating activities. |
53
Results of Operations
Comparison of Three Months Ended June 30, 2025 to Three Months Ended June 30, 2024
Segment Information
United States Segment
The following table presents revenues, expenses and profit for our United States segment for the three months ended June 30, 2025 and 2024:
| Three months ended June 30, | ||||||||
| 2025 | 2024 | |||||||
| (U.S. $ in millions / % of Segment Revenues) | ||||||||
| Revenues |
$2,151 | 100% | $2,110 | 100% | ||||
| Cost of sales |
901 | 41.9% | 943 | 44.7% | ||||
| Gross profit |
1,250 | 58.1% | 1,167 | 55.3% | ||||
| R&D expenses |
152 | 7.0% | 170 | 8.1% | ||||
| S&M expenses |
279 | 13.0% | 270 | 12.8% | ||||
| G&A expenses |
113 | 5.2% | 100 | 4.7% | ||||
| Other |
§ | § | (1) | § | ||||
|
|
|
|
|
|||||
| Segment profit* |
$706 | 32.8% | $629 | 29.8% | ||||
|
|
|
|
|
|||||
| * | Segment profit does not include amortization and certain other items. |
| § | Represents an amount less than $0.5 million or 0.5%, as applicable. |
United States Revenues
Revenues from our United States segment in the second quarter of 2025 were $2,151 million, an increase of $41 million, or 2%, compared to the second quarter of 2024. This increase was mainly due to higher revenues from our innovative products, mainly AUSTEDO, UZEDY and AJOVY, partially offset by lower revenues from generic products and COPAXONE.
Revenues by Major Products and Activities
The following table presents revenues for our United States segment by major products and activities for the three months ended June 30, 2025 and 2024:
| Three months ended June 30, |
Percentage Change |
|||||||||||
| 2025 | 2024 | 2025-2024 | ||||||||||
| (U.S. $ in millions) | ||||||||||||
| Generic products (including biosimilars) |
$ | 961 | $ | 1,023 | (6 | %) | ||||||
| AJOVY |
63 | 42 | 53 | % | ||||||||
| AUSTEDO |
495 | 407 | 22 | % | ||||||||
| BENDEKA and TREANDA |
40 | 41 | (3 | %) | ||||||||
| COPAXONE |
62 | 81 | (23 | %) | ||||||||
| UZEDY |
54 | 24 | 120 | % | ||||||||
| Anda |
365 | 373 | (2 | %) | ||||||||
| Other |
111 | 119 | (7 | %) | ||||||||
|
|
|
|
|
|||||||||
| Total |
$ | 2,151 | $ | 2,110 | 2 | % | ||||||
|
|
|
|
|
|||||||||
54
Generic products (including biosimilars) revenues in our United States segment in the second quarter of 2025 were $961 million, a decrease of 6% compared to the second quarter of 2024. This decrease was mainly driven by lower revenues from lenalidomide capsules (the generic version of Revlimid®) and liraglutide injection 1.8mg (an authorized generic of Victoza®), driven primarily by increased competition, partially offset by higher revenues from our portfolio of biosimilar products.
Among the most significant generic products we sold in the United States in the second quarter of 2025 were lenalidomide capsules (the generic version of Revlimid®), epinephrine injectable solution (the generic equivalent of EpiPen® and EpiPen Jr®) and Truxima® (the biosimilar to Rituxan®). In the second quarter of 2025, our total prescriptions were approximately 266 million (based on trailing twelve months), representing 6.9% of total U.S. generic prescriptions, compared to approximately 303 million (based on trailing twelve months), representing 7.9% of total U.S. generic prescriptions in the second quarter of 2024, all according to IQVIA data.
On April 7, 2025, Teva and Samsung Bioepis Co., Ltd. announced the availability of, and subsequently launched, EPYSQLI® (eculizumab-aagh), a biosimilar to Soliris® (eculizumab), in the U.S., for the treatment of paroxysmal nocturnal hemoglobinuria (PNH), atypical hemolytic uremic syndrome (aHUS) and generalized myasthenia gravis (gMG) in adult patients who are anti-acetylcholine receptor (AchR) antibody positive.
AJOVY revenues in our United States segment in the second quarter of 2025 were $63 million, an increase of 53% compared to the second quarter of 2024, mainly due to an increase in sales allowance due to a non-recurring item in the second quarter of 2024, and growth in volume in the second quarter of 2025. In the second quarter of 2025, AJOVY’s exit market share in the United States in terms of total number of prescriptions was 31.0% out of subcutaneous injectable anti- CGRP class, compared to 28.6% in the second quarter of 2024.
AJOVY is indicated for the preventive treatment of migraine in adults and was launched in the U.S. in 2018. AJOVY is the only anti-CGRP subcutaneous product indicated for both quarterly and monthly dosing options. In April 2025, the FDA accepted Teva’s supplemental Biologics License Application (sBLA) for AJOVY to expand the indication to include children and adolescents.
AJOVY is protected worldwide by patents expiring in 2026 at the earliest; extensions have been granted in several countries, including the United States and in Europe, until 2031. Additional patents relating to the use of AJOVY in the treatment of migraine have also been issued in the United States and Europe and will expire between 2035 and 2039. Such patents are also pending in other countries. AJOVY will also be protected by regulatory exclusivity for 12 years from marketing approval in the United States (obtained in September 2018) and 10 years from marketing approval in Europe (obtained in April 2019).
In October 2017, we filed a lawsuit in the U.S. District Court for the District of Massachusetts alleging that Eli Lilly & Co.’s (“Lilly”) marketing and sale of its galcanezumab product for the treatment of migraine infringes nine Teva patents, including three method of treatment patents and six composition of matter patents. Lilly then submitted IPR petitions to the PTAB, challenging the validity of the nine Teva patents. The PTAB issued decisions upholding the three method of treatment patents but finding the six composition of matter patents invalid, which decisions were affirmed by the Court of Appeals for the Federal Circuit on August 16, 2021. A jury trial regarding the three method of treatment patents resulted in a verdict in Teva’s favor on November 9, 2022, in which the three method of treatment patents were determined to be valid and infringed by Lilly, and Teva was awarded $176.5 million in damages. On September 26, 2023, the U.S. District Court for the District of Massachusetts issued a decision that reversed the jury’s verdict and damages award, finding Teva’s method of treatment patents to be invalid. Teva appealed this ruling on October 24, 2023, and the matter is fully briefed. The appeal hearing has been set for September 5, 2025.
In addition, in 2018, we entered into separate agreements with Alder Biopharmaceuticals, Inc. and Lilly resolving the European Patent Office oppositions that they filed against our AJOVY patents. The settlement agreement with Lilly also resolved Lilly’s action to revoke the patent protecting AJOVY in the United Kingdom.
AUSTEDO revenues in our United States segment in the second quarter of 2025 were $495 million, an increase of 22%, compared to $407 million in the second quarter of 2024. This increase was mainly due to growth in volumes, including the approval of AUSTEDO XR as a one pill, once-daily treatment in 2024.
AUSTEDO was launched in the U.S. in 2017. It is indicated for the treatment of chorea associated with Huntington’s disease and for the treatment of tardive dyskinesia in adults.
55
AUSTEDO is protected in the United States by 14 Orange Book patents expiring between 2031 and 2038. We received notice letters from two ANDA filers regarding the filing of their ANDAs with paragraph (IV) certifications for certain of the patents listed in the Orange Book for AUSTEDO. On April 29, 2022 and June 8, 2022, we reached agreements with Lupin and Aurobindo, respectively, to sell their generic products beginning in April 2033, or earlier under certain circumstances. In addition, Apotex filed a petition for IPR by the Patent and Trial Appeal Board (“PTAB”) of the patent covering the deutetrabenazine compound that expires in 2031. On March 9, 2022, the U.S. Patent and Trademark Office denied Apotex’s petition and declined to institute a review of the deutetrabenazine patent. In China, invalidity proceedings were initiated against the deutetrabenazine compound patent by a local Chinese pharmaceutical company, and were discontinued following a settlement between the parties. There are no further patent litigations pending regarding AUSTEDO at this time.
AUSTEDO XR (deutetrabenazine) extended-release tablets was approved by the FDA on February 17, 2023 in three doses of 6, 12 and 24 mg, and became commercially available in the U.S. in May 2023. The FDA approved AUSTEDO XR as a one pill, once-daily treatment option in doses of 30, 36, 42, and 48 mg in May 2024 and in 18 mg in July 2024. AUSTEDO XR is a once-daily formulation indicated in adults for tardive dyskinesia and chorea associated with Huntington’s disease, which is additional to the currently marketed twice-daily AUSTEDO. AUSTEDO XR is protected by 11 Orange Book patents expiring between 2031 and 2041.
On January 17, 2025, the Centers for Medicare and Medicaid Services (“CMS”) released a list of prescription medicines selected for price-setting discussions, which included AUSTEDO and AUSTEDO XR. The price-setting process has commenced, and the revised prices set by the U.S. Government, which will apply to eligible Medicare patients, are expected to become effective on January 1, 2027. As the price-setting process is still in its early stages, the extent to which prices for AUSTEDO and AUSTEDO XR will change as a result of such discussions remains uncertain.
UZEDY (risperidone) extended-release injectable suspension revenues in our United States segment in the second quarter of 2025 were $54 million, an increase of 120% compared to the second quarter of 2024, mainly due to growth in volume.
UZEDY was approved by the FDA on April 28, 2023 for the treatment of schizophrenia in adults, and was launched in the U.S. in May 2023. UZEDY is a subcutaneous, long-acting formulation of risperidone that controls the steady release of risperidone. UZEDY is protected by four Orange Book patents expiring between 2027 and 2040. UZEDY is protected by regulatory exclusivity until April 28, 2026. We are moving forward with plans to launch UZEDY in other countries around the world. UZEDY faces competition from multiple products.
BENDEKA and TREANDA combined revenues in our United States segment in the second quarter of 2025 were $40 million, a decrease of 3% compared to the second quarter of 2024, mainly due to competition from alternative therapies, as well as from generic bendamustine products.
In April 2019, we signed an amendment to the license agreement with Eagle extending the royalty term applicable to the United States to the full period for which we sell BENDEKA and increased the royalty rate. In consideration, Eagle agreed to assume a portion of BENDEKA-related patent litigation expenses.
There are 19 patents listed in the U.S. Orange Book for BENDEKA with expiration dates in 2026 and 2031. In August 2021, the Court of Appeals for the Federal Circuit affirmed the district court’s decision upholding the validity of all of the asserted patents and finding infringement by two remaining ANDA filers. Another ANDA filer did not join the appeal, and Teva also settled with two ANDA filers.
Teva also settled litigation against three 505(b)(2) applicants, Hospira, Inc. (“Hospira”), Dr. Reddy’s Laboratories (“DRL”) and Accord Healthcare (“Accord”). Based on these settlement agreements, Hospira, Accord and DRL can launch their products on November 17, 2027, or earlier under certain circumstances. In 2023, Teva and Eagle also filed suit against BendaRx Corp. in the U.S. District Court for the District of Delaware, following its filing of a 505(b)(2) NDA for a bendamustine product, and that litigation is still pending.
In addition to the settlement with Eagle regarding its bendamustine 505(b)(2) NDA, between 2015 and 2020, we reached final settlements with 22 ANDA filers for generic versions of the lyophilized form of TREANDA and one 505(b)(2) NDA filer for a generic version of the liquid form of TREANDA, providing for the launch of generic versions of TREANDA prior to patent expiration. Currently, there are multiple generic TREANDA products on the market.
56
COPAXONE revenues in our United States segment in the second quarter of 2025 were $62 million, a decrease of 23% compared to the second quarter of 2024, mainly due to market share erosion and competition.
The market for MS treatments continues to develop, particularly with the approval of generic versions of COPAXONE. Oral branded and generic treatments for MS, such as Tecfidera® (dimethyl fumarate) and Gilenya® (fingolimod) continue to present significant and increasing competition. COPAXONE also continues to face competition from existing injectable products, as well as from monoclonal antibodies, such as Ocrevus®, Kesimpta® and Tysabri®.
Anda revenues from third-party products in our United States segment in the second quarter of 2025 were $365 million, a decrease of 2%, compared to $373 million in the second quarter of 2024. This decrease was mainly due to lower volumes. Anda, our distribution business in the United States, distributes generic and innovative medicines and OTC pharmaceutical products from Teva and various third-party manufacturers to independent retail pharmacies, pharmacy retail chains, hospitals and physician offices in the United States.
Anda competes in the distribution market by maintaining a broad portfolio of products, competitive pricing and delivery throughout the United States.
Product Launches and Pipeline
In the second quarter of 2025, we launched the generic and biosimilar version of the following branded products in the United States:
| Product Name |
Brand |
Launch |
Total Annual U.S. Branded Sales at Time of Launch (U.S. $ in millions (IQVIA))* |
|||||
| Ticagrelor Tablets |
Brilinta® tablets | May | $ | 1,305 | ||||
| EPYSQLI (eculizumab-aagh) |
Soliris® | April | $ | 367 | ||||
| Perampanel Tablets CIII |
Fycoma® CIII | May | $ | 217 | ||||
| Phentermine and Topiramate Extended-release Capsules |
Qsymia® | May | $ | 63 | ||||
| Hydroxyzine Hydrochloride Tablets, USP** |
N/A | June | $ | 17 | ||||
| * | The figures presented are for the twelve months ended in the calendar quarter immediately prior to our launch or re-launch. |
| ** | Product was re-launched. |
As of June 30, 2025, our generic products pipeline in the United States includes 128 product applications awaiting FDA approval, including 69 tentative approvals. This total reflects all pending ANDAs, supplements for product line extensions and tentatively approved applications and includes some instances where more than one application was submitted for the same reference product. Excluding overlaps, the branded products underlying these pending applications had U.S. sales for the twelve months ended March 31, 2025 of approximately $128 billion, according to IQVIA. Approximately 74% of pending applications include a paragraph IV patent challenge, and we believe we are first-to-file with respect to 55 of these products, or 81 products including final approvals where launch is pending a settlement agreement or court decision. Collectively, these first-to-file opportunities represent over $80 billion in U.S. brand sales for the twelve months ended March 31, 2025, according to IQVIA.
IQVIA reported brand sales are one of the many indicators of future potential value of a launch, but equally important are the mix and timing of competition, as well as cost effectiveness. The potential advantages of being the first filer with respect to some of these products may be subject to forfeiture, shared exclusivity or competition from so-called “authorized generics,” which may ultimately affect the value derived.
57
In the second quarter of 2025, we received tentative approvals for generic equivalents of the products listed in the table below, excluding overlapping applications. A “tentative approval” indicates that the FDA has substantially completed its review of an application and final approval is expected once the relevant patent expires, a court decision is reached, a 30-month regulatory stay lapses or a 180-day exclusivity period awarded to another manufacturer either expires or is forfeited.
| Generic Name |
Brand Name |
Total Annual U.S. Branded Sales at Time of Launch (U.S. $ in millions (IQVIA))* |
||||||
| Azacitidine Tablets, 200 mg and 300 mg |
Onureg | ® | $ | 141 | ||||
| Octreotide Delayed-release Capsules, 20** mg |
Mycapssa | ® | No Data | |||||
| * | The figures presented are for the twelve months ended in the calendar quarter immediately prior to our launch or re-launch. |
| ** | Mycapssa® ships directly to patients, no IQVIA data is available. |
For information regarding our innovative and biosimilar products pipeline, see “—Teva Consolidated Results—Research and Development (R&D) Expenses” below.
United States Gross Profit
Gross profit from our United States segment in the second quarter of 2025 was $1,250 million, an increase of 7%, compared to $1,167 million in the second quarter of 2024.
Gross profit margin for our United States segment in the second quarter of 2025 increased to 58.1%, compared to 55.3% in the second quarter of 2024. This increase was mainly due to a favorable mix of products primarily driven by higher revenues from AUSTEDO.
United States R&D Expenses
R&D expenses relating to our United States segment in the second quarter of 2025 were $152 million, a decrease of 11%, compared to $170 million in the second quarter of 2024.
For a description of our R&D expenses in the second quarter of 2025, see “—Teva Consolidated Results—Research and Development (R&D) Expenses, net” below.
United States S&M Expenses
S&M expenses relating to our United States segment in the second quarter of 2025 were $279 million, an increase of 3%, compared to $270 million in the second quarter of 2024. This increase was mainly due to promotional activities related to our key innovative products.
United States G&A Expenses
G&A expenses relating to our United States segment in the second quarter of 2025 were $113 million, an increase of 13% compared to $100 million in the second quarter of 2024.
For a description of our G&A expenses in the second quarter of 2025, see “—Teva Consolidated Results—General and Administrative (G&A) Expenses” below.
United States Profit
Profit from our United States segment consists of revenues less cost of sales, R&D expenses, S&M expenses, G&A expenses and other expenses (income) related to this segment. Segment profit does not include amortization and certain other items.
Profit from our United States segment in the second quarter of 2025 was $706 million, an increase of 12% compared to $629 million in the second quarter of 2024. This increase was mainly due to higher gross profit, as discussed above.
58
Europe Segment
The following table presents revenues, expenses and profit for our Europe segment for the three months ended June 30, 2025 and 2024:
| Three months ended June 30, | ||||||||||||||||
| 2025 | 2024 | |||||||||||||||
| (U.S. $ in millions / % of Segment Revenues) | ||||||||||||||||
| Revenues |
$ | 1,298 | 100 | % | $ | 1,213 | 100 | % | ||||||||
| Cost of sales |
581 | 44.8 | % | 536 | 44.2 | % | ||||||||||
| Gross profit |
717 | 55.2 | % | 677 | 55.8 | % | ||||||||||
| R&D expenses |
59 | 4.6 | % | 62 | 5.1 | % | ||||||||||
| S&M expenses |
228 | 17.5 | % | 209 | 17.2 | % | ||||||||||
| G&A expenses |
66 | 5.1 | % | 64 | 5.3 | % | ||||||||||
| Other |
§ | § | § | § | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Segment profit* |
$ | 364 | 28.0 | % | $ | 342 | 28.2 | % | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| * | Segment profit does not include amortization and certain other items. |
| § | Represents an amount less than $0.5 million or 0.5%, as applicable. |
Europe Revenues
Our Europe segment includes the European Union, the United Kingdom and certain other European countries.
Revenues from our Europe segment in the second quarter of 2025 were $1,298 million, an increase of 7%, or $85 million, compared to the second quarter of 2024. In local currency terms, revenues increased by 3% compared to the second quarter of 2024, mainly due to proceeds from the sale of certain product rights, higher revenues from AJOVY and higher revenues from generic products.
In the second quarter of 2025, revenues were positively impacted by exchange rate fluctuations of $46 million, net of hedging effects, compared to the second quarter of 2024. Revenues in the second quarter of 2025, included $25 million from a negative hedging impact, which is included in “Other” in the table below. Revenues in the second quarter of 2024 included $3 million from a positive hedging impact, which is included in “Other” in the table below. See note 8d to our consolidated financial statements.
Revenues by Major Products and Activities
The following table presents revenues for our Europe segment by major products and activities for the three months ended June 30, 2025 and 2024:
| Three months ended June 30, |
Percentage Change |
|||||||||||
| 2025 | 2024 | 2025-2024 | ||||||||||
| (U.S. $ in millions) | ||||||||||||
| Generic products (including OTC and biosimilars) |
$ | 1,040 | $ | 970 | 7 | % | ||||||
| AJOVY |
71 | 52 | 38 | % | ||||||||
| COPAXONE |
50 | 53 | (6 | %) | ||||||||
| Respiratory products |
55 | 57 | (3 | %) | ||||||||
| Other* |
81 | 81 | 1 | % | ||||||||
|
|
|
|
|
|||||||||
| Total |
$ | 1,298 | $ | 1,213 | 7 | % | ||||||
|
|
|
|
|
|||||||||
| * | Other revenues in the second quarter of 2025 include the sale of certain product rights. |
59
Generic products revenues (including OTC and biosimilar products) in our Europe segment in the second quarter of 2025, were $1,040 million, an increase of 7% compared to the second quarter of 2024. In local currency terms, revenues increased by 1%, mainly due to OTC price increases, as well as revenues from recently launched products, partially offset by lower volumes.
AJOVY revenues in our Europe segment in the second quarter of 2025 increased by 38% to $71 million, compared to $52 million in the second quarter of 2024. In local currency terms revenues increased by 30% due to growth in volume.
For information about AJOVY patent protection, see “—United States Revenues—Revenues by Major Products and Activities” above.
COPAXONE revenues in our Europe segment in the second quarter of 2025 were $50 million, a decrease of 6% compared to the second quarter of 2024. In local currency terms revenues decreased by 11%, due to price reductions and a decline in volume resulting from the availability of alternative therapies and competing glatiramer acetate products.
In certain countries, Teva remains in litigation against generic companies regarding COPAXONE.
Respiratory products revenues in our Europe segment in the second quarter of 2025 were $55 million, a decrease of 3% compared to the second quarter of 2024. In local currency terms, revenues decreased by 8%, mainly due to net price reductions and lower volumes.
Product Launches and Pipeline
As of June 30, 2025, our generic products pipeline in Europe included 273 generic approvals relating to 30 compounds in 67 formulations, with no European Medicines Agency (“EMA”) approvals received. In addition, approximately 1,490 marketing authorization applications are pending approval in 37 European countries, relating to 97 compounds in 215 formulations. No applications are pending with the EMA.
For information regarding our innovative medicines and biosimilar products pipeline, see “—Teva Consolidated Results—Research and Development (R&D) Expenses” below.
Europe Gross Profit
Gross profit from our Europe segment in the second quarter of 2025 was $717 million, an increase of 6% compared to $677 million in the second quarter of 2024.
Gross profit margin for our Europe segment in the second quarter of 2025 decreased to 55.2%, compared to 55.8% in the second quarter of 2024. This decrease was mainly due to a negative impact from hedging activities and an unfavorable mix of products, partially offset by proceeds from the sale of certain product rights.
Europe R&D Expenses
R&D expenses relating to our Europe segment in the second quarter of 2025 were $59 million, a decrease of 5% compared to $62 million in the second quarter of 2024.
For a description of our R&D expenses in the second quarter of 2025, see “—Teva Consolidated Results—Research and Development (R&D) Expenses, net” below.
Europe S&M Expenses
S&M expenses relating to our Europe segment in the second quarter of 2025 were $228 million, an increase of 9% compared to $209 million in the second quarter of 2024. This increase was mainly due to exchange rate fluctuations as well as to support revenue growth of our generic and key innovative products, including new launches.
Europe G&A Expenses
G&A expenses relating to our Europe segment in the second quarter of 2025 were $66 million, an increase of 3% compared to $64 million in the second quarter of 2024.
For a description of our G&A expenses in the second quarter of 2025, see “—Teva Consolidated Results—General and Administrative (G&A) Expenses” below.
Europe Profit
Profit from our Europe segment consists of revenues less cost of sales, R&D expenses, S&M expenses, G&A expenses and other expenses (income) related to this segment. Segment profit does not include amortization and certain other items.
60
Profit from our Europe segment in the second quarter of 2025 was $364 million, an increase of 6%, compared to $342 million in the second quarter of 2024. This increase was mainly due to higher gross profit, partially offset by higher S&M expenses, as discussed above.
International Markets Segment
The following table presents revenues, expenses and profit for our International Markets segment for the three months ended June 30, 2025 and 2024:
| Three months ended June 30, | ||||||||||||||||
| 2025 | 2024 | |||||||||||||||
| (U.S. $ in millions / % of Segment Revenues) | ||||||||||||||||
| Revenues |
$ | 495 | 100 | % | $ | 593 | 100 | % | ||||||||
| Cost of sales |
251 | 50.8 | % | 307 | 51.7 | % | ||||||||||
| Gross profit |
243 | 49.2 | % | 286 | 48.3 | % | ||||||||||
| R&D expenses |
24 | 4.9 | % | 30 | 5.1 | % | ||||||||||
| S&M expenses |
114 | 23.0 | % | 145 | 24.5 | % | ||||||||||
| G&A expenses |
32 | 6.6 | % | 38 | 6.4 | % | ||||||||||
| Other |
(1 | ) | § | § | § | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Segment profit* |
$ | 74 | 14.9 | % | $ | 73 | 12.3 | % | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| * | Segment profit does not include amortization and certain other items. |
| § | Represents an amount less than $0.5 million or 0.5%, as applicable. |
International Markets Revenues
Our International Markets segment includes all countries in which we operate other than the United States and the countries included in our Europe segment. The International Markets segment covers a substantial portion of the global pharmaceutical industry, including more than 35 countries.
The countries in our International Markets segment include highly regulated, mainly generic markets, such as Canada and Israel, and branded generics-oriented markets, such as Russia and certain Latin America markets.
On March 31, 2025, we closed the agreement with JKI Co. Ltd., established by the fund managed and operated by private equity firm J-Will Partners Co. Ltd., to sell our Teva-Takeda business venture in Japan, which includes generic products and legacy products. See note 2 and note 17 to our consolidated financial statements.
As of the date of this Quarterly Report on Form 10-Q, sustained conflict between Russia and Ukraine and disruption in the region is ongoing. Russia and Ukraine markets are included in our International Markets segment results and we have no manufacturing or R&D facilities in these markets. During the three months ended June 30, 2025, the impact of this conflict on our International Markets segment’s results of operations and financial condition was immaterial. Consistent with our foreign exchange risk management hedging programs, in the three months ended June 30, 2025 we partially hedged our exposure to currency exchange rate fluctuations with respect to our balance sheet assets, revenues and expenses. However, as of the end of the second quarter of 2025, we hedge a small part of our projected net revenues in Russian ruble for 2025. Prior to and since the escalation of the conflict, we have been taking measures to reduce our operational cash balances in Russia and Ukraine. We have been monitoring the solvency of our customers in Russia and Ukraine and have taken measures, where practicable, to mitigate our exposure to risks related to the conflict in the region. However, the duration, severity and global implications (including potential inflation and devaluation consequences) of the conflict cannot be predicted at this time and could have an effect on our business, including on our exchange rate exposure, supply chain, operational costs and commercial presence in these markets.
Revenues from our International Markets segment in the second quarter of 2025 were $495 million, a decrease of 17% compared to the second quarter of 2024. In local currency terms, revenues decreased by 16% compared to the second quarter of 2024. This decrease was mainly due to the divestment of our business venture in Japan.
61
In the second quarter of 2025, revenues were negatively impacted by exchange rate fluctuations of $2 million, including hedging effects, compared to the second quarter of 2024. Revenues in the second quarter of 2025 included $8 million from a negative hedging impact, compared to a negative hedging impact of $5 million in the second quarter of 2024, which are included in “Other” in the table below. See note 8d to our consolidated financial statements.
Revenues by Major Products and Activities
The following table presents revenues for our International Markets segment by major products and activities for the three months ended June 30, 2025 and 2024:
| Three months ended June 30, |
Percentage Change |
|||||||||||
| 2025 | 2024 | 2025-2024 | ||||||||||
| (U.S. $ in millions) | ||||||||||||
| Generic products (including OTC and biosimilars) |
$ | 410 | $ | 486 | (16 | %) | ||||||
| AJOVY |
20 | 22 | (7 | %) | ||||||||
| AUSTEDO |
3 | 12 | (76 | %) | ||||||||
| COPAXONE |
7 | 14 | (50 | %) | ||||||||
| Other |
55 | 59 | (6 | %) | ||||||||
|
|
|
|
|
|||||||||
| Total |
$ | 495 | $ | 593 | (17 | %) | ||||||
|
|
|
|
|
|||||||||
Generic products revenues (including OTC and biosimilar products) in our International Markets segment were $410 million in the second quarter of 2025, a decrease of 16% in both U.S. dollars and local currency terms, compared to the second quarter of 2024, mainly due to the divestment of our business venture in Japan.
AJOVY was launched in certain markets in our International Markets segment, including in Canada, Japan, Australia, Israel, South Korea, Brazil and others. AJOVY revenues in our International Markets segment in the second quarter of 2025 were $20 million, compared to $22 million in the second quarter of 2024, mainly due to timing of shipments.
AUSTEDO was launched in China and Israel in 2021 and in Brazil in 2022, for the treatment of chorea associated with Huntington’s disease and for the treatment of tardive dyskinesia. In February 2024, we announced a strategic partnership for the marketing and distribution of AUSTEDO in China. In April 2025, AUSTEDO received marketing authorization in South Korea. We continue to pursue additional submissions in various other markets.
AUSTEDO revenues in our International Markets segment in the second quarter of 2025 were $3 million compared to $12 million in the second quarter of 2024. In local currency terms, revenues decreased by 75%, mainly due to timing of shipments.
COPAXONE revenues in our International Markets segment in the second quarter of 2025 were $7 million compared to $14 million in the second quarter of 2024.
International Markets Gross Profit
Gross profit from our International Markets segment in the second quarter of 2025 was $243 million, a decrease of 15% compared to $286 million in the second quarter of 2024.
Gross profit margin for our International Markets segment in the second quarter of 2025 increased to 49.2%, compared to 48.3% in the second quarter of 2024. This increase was mainly due to a favorable mix of products, mainly in connection with the divestment of our business venture in Japan.
International Markets R&D Expenses
R&D expenses relating to our International Markets segment in the second quarter of 2025 were $24 million, a decrease of 19% compared to the second quarter of 2024.
For a description of our R&D expenses in the second quarter of 2025, see “—Teva Consolidated Results—Research and Development (R&D) Expenses, net” below.
62
International Markets S&M Expenses
S&M expenses relating to our International Markets segment in the second quarter of 2025 were $114 million, a decrease of 22% compared to the second quarter of 2024, mainly due to the divestment of our business venture in Japan.
International Markets G&A Expenses
G&A expenses relating to our International Markets segment in the second quarter of 2025 were $32 million, a decrease of 15% compared to the second quarter of 2024.
International Markets Profit
Profit from our International Markets segment consists of revenues less cost of sales, R&D expenses, S&M expenses, G&A expenses and other expenses (income) related to this segment. Segment profit does not include amortization and certain other items.
Profit from our International Markets segment in the second quarter of 2025 was $74 million, an increase of 1%, compared to $73 million in the second quarter of 2024. This increase was mainly due to lower operating expenses, partially offset by a decrease in gross profit, mainly as a result of the divestment of our business venture in Japan.
Other Activities
We have other sources of revenues, primarily the sale of APIs to third parties, certain contract manufacturing services and an out-licensing platform offering a portfolio of products to other pharmaceutical companies through our affiliate Medis. Our other activities are not included in our United States, Europe or International Markets segments described above.
On January 31, 2024, we announced that we intend to divest our API business (including its R&D, manufacturing and commercial activities) through a sale. The intention to divest is in alignment with our Pivot to Growth strategy. However, there can be no assurance regarding the ultimate timing or structure of a potential divestiture or that a divestiture will be agreed or completed at all. For further information, see note 2 to our consolidated financial statements.
Our revenues from other activities in the second quarter of 2025 were $232 million, a decrease of 7% in U.S. dollars, or 9% in local currency terms, compared to the second quarter of 2024.
API sales to third parties in the second quarter of 2025 were $135 million, a decrease of 11% in both U.S. dollars and local currency terms, compared to the second quarter of 2024, mainly due to lower demand and timing of shipments.
Teva Consolidated Results
Revenues
Revenues in the second quarter of 2025 were $4,176 million, flat in U.S. dollars, or a decrease of 1% in local currency terms compared to the second quarter of 2024. This decrease was mainly due to lower revenues from generic products in our International Markets segment associated with the divestment of our business venture in Japan, as well as in our U.S. segment, and a decrease in revenues from COPAXONE, partially offset by an increase in revenues from our key innovative products AUSTEDO, AJOVY and UZEDY.
See “—United States Revenues,” “—Europe Revenues,” “—International Markets Revenues” and “—Other Activities” above.
Exchange rate movements during the second quarter of 2025, net of hedging effects, positively impacted revenues by $49 million, compared to the second quarter of 2024. See note 8d to our consolidated financial statements.
Gross Profit
Gross profit in the second quarter of 2025, was $2,102 million, an increase of 4% compared to $2,024 million in the second quarter of 2024.
Gross profit margin was 50.3% in the second quarter of 2025, compared to 48.6% in the second quarter of 2024. This increase was mainly due to a favorable mix of products, primarily driven by higher revenues from AUSTEDO, the sale of certain product rights in our Europe Segment and the divestment of our business venture in Japan, partially offset by lower revenues from COPAXONE.
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Research and Development (R&D) Expenses, net
Our R&D activities for innovative medicines and biosimilar products in each of our segments include costs of discovery research, preclinical work, drug formulation, early- and late-stage clinical development and product registration costs. These expenditures are reported net of contributions received from collaboration partners. Our spending takes place throughout the development process, including (i) early-stage projects in both discovery and preclinical phases; (ii) middle-stage projects in clinical programs up to Phase 3; (iii) late-stage projects in Phase 3 programs, including where a new drug application is currently pending approval; (iv) post-approval studies for marketed products; and (v) indirect expenses, such as costs of internal administration, infrastructure and personnel.
Our R&D activities for generic products in each of our segments include both (i) direct expenses relating to product formulation, analytical method development, stability testing, management of bioequivalence and other clinical studies and regulatory filings; and (ii) indirect expenses, such as costs of internal administration, infrastructure and personnel.
In the second quarter of 2025, our R&D expenses, net related primarily to innovative product candidates and marketed products in neuroscience, immunology and immuno-oncology, and selected other areas, as well as generic products and biosimilars.
R&D expenses, net in the second quarter of 2025, were $244 million, a decrease of 9% compared to $269 million in the second quarter of 2024.
Our lower R&D expenses, net in the second quarter of 2025 compared to the second quarter of 2024, were mainly due to a decrease in non-recurring milestone payments related to certain biosimilar projects, and a decrease in our generics projects.
Our R&D expenses, net in the second quarter of 2025, were also impacted by reimbursements from the strategic partnerships we entered into in 2023 and 2024. See note 2 to our consolidated financial statements.
R&D expenses, net as a percentage of revenues were 5.8% in the second quarter of 2025, compared to 6.5% in the second quarter of 2024.
Innovative Medicines Pipeline
Below is a description of key products in our innovative medicines pipeline as of July 30, 2025:
| Phase 2 |
Phase 3 |
|||||
| Neuroscience | Olanzapine LAI (TEV-‘749) Schizophrenia (September 2022) |
|||||
| Immunology | Duvakitug (anti-TL1A) (1) (TEV-’574) Inflammatory Bowel Disease |
Dual Action Rescue Inhaler (DARI) (ICS/SABA; TEV-’248) (3) Asthma (February 2023) |
||||
| Anti-IL-15 (TEV-’408) Celiac |
||||||
| Emrusolmin(2) (TEV-‘286) Multiple System Atropy |
||||||
| (1) | In collaboration with Sanofi. |
| (2) | In collaboration with Modag. |
| (3) | In collaboration with Launch Therapeutics. |
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Biosimilar Products Pipeline
We have additional biosimilar products in development internally and with our partners that are in various stages of clinical trials and regulatory review worldwide, including confirmatory clinical trials for biosimilars to Xolair® (omalizumab), to Xgeva® (denosumab), which was submitted for regulatory review in Europe, to Entyvio® (vedolizymab), which is in collaboration with Alvotech for the U.S. market, and TEV-‘333 a biosimilar in collaboration with mAbxience. Our proposed biosimilar to Prolia® (denosumab) was submitted for regulatory review in the U.S. and Europe. Our proposed biosimilars to Simponi®, Simponi Aria® (golimumab), and Eyla (aflibercept), which are in collaboration with Alvotech, were submitted for regulatory review in the U.S.
Selling and Marketing (S&M) Expenses
S&M expenses in the second quarter of 2025, were $654 million, flat compared to the second quarter of 2024. This was mainly the result of the factors discussed above under “—United States segment—S&M Expenses,” “—Europe segment— S&M Expenses” and “—International Markets segment— S&M Expenses”.
S&M expenses as a percentage of revenues were 15.7% in the second quarter of 2025, compared to 15.8% in the second quarter of 2024.
General and Administrative (G&A) Expenses
G&A expenses in the second quarter of 2025, were $305 million, an increase of 8% compared to the second quarter of 2024. This increase was mainly due to costs related to optimization activities of Teva’s global organization and operations in connection with Teva’s Transformation programs.
G&A expenses as a percentage of revenues were 7.3% in the second quarter of 2025 compared to 6.8% in the second quarter of 2024.
Intangible Asset Impairments
We recorded expenses of $42 million for identifiable intangible asset impairments in the second quarter of 2025, compared to expenses of $61 million in the second quarter of 2024. See note 5 to our consolidated financial statements.
Goodwill Impairment
No goodwill impairments were recorded in the second quarter of 2025, compared to a goodwill impairment charge of $400 million in the second quarter of 2024 related to Teva’s API reporting unit. See note 6 to our consolidated financial statements.
Other Asset Impairments, Restructuring and Other Items
We recorded expenses of $232 million for other asset impairments, restructuring and other items in the second quarter of 2025, compared to expenses of $280 million in the second quarter of 2024. See note 12 to our consolidated financial statements.
Legal Settlements and Loss Contingencies
We recorded expenses of $166 million in legal settlements and loss contingencies in the second quarter of 2025, compared to expenses of $83 million in the second quarter of 2024. See note 9 to our consolidated financial statements.
Operating Income (Loss)
Operating Income was $455 million in the second quarter of 2025, compared to an operating loss of $5 million in the second quarter of 2024. This increase was mainly due to the goodwill impairment charge recorded in the second quarter of 2024, as well as higher gross profit in the second quarter of 2025, partially offset by higher legal settlements and loss contingencies in the second quarter of 2025.
Operating income as a percentage of revenues was 10.9% in the second quarter of 2025, compared to an operating loss as a percentage of revenues of 0.1% in the second quarter of 2024.
Financial Expenses, Net
In the second quarter of 2025, financial expenses, net were $252 million, mainly comprised of net-interest expenses of $203 million. In the second quarter of 2024, financial expenses, net were $241 million, mainly comprised of net-interest expenses of $233 million.
65
Reconciliation Table to Consolidated Income (Loss) Before Income Taxes
The following table presents a reconciliation of our segment profits to our consolidated operating income (loss) and to consolidated income (loss) before income taxes for the three months ended June 30, 2025 and 2024:
| Three months ended | ||||||||
| 2025 | 2024 | |||||||
| (U.S. $ in millions) | ||||||||
| United States profit |
$ | 706 | $ | 629 | ||||
| Europe profit |
364 | 342 | ||||||
| International Markets profit |
74 | 73 | ||||||
|
|
|
|
|
|||||
| Total reportable segments profit |
1,144 | 1,043 | ||||||
| Profit of other activities |
(11 | ) | 12 | |||||
|
|
|
|
|
|||||
| Total segments profit |
1,133 | 1,056 | ||||||
| Amounts not allocated to segments: |
||||||||
| Amortization |
148 | 146 | ||||||
| Other assets impairments, restructuring and other items |
232 | 280 | ||||||
| Goodwill impairment |
— | 400 | ||||||
| Intangible assets impairments |
42 | 61 | ||||||
| Legal settlements and loss contingencies |
166 | 83 | ||||||
| Other unallocated amounts |
91 | 91 | ||||||
|
|
|
|
|
|||||
| Consolidated operating income (loss) |
455 | (5 | ) | |||||
|
|
|
|
|
|||||
| Financial expenses, net |
252 | 241 | ||||||
|
|
|
|
|
|||||
| Consolidated income (loss) before income taxes |
$ | 203 | $ | (246 | ) | |||
|
|
|
|
|
|||||
Income Taxes
In the second quarter of 2025, we recognized a tax benefit of $78 million, on a pre-tax income of $203 million. In the second quarter of 2024, we recognized a tax expense of $630 million, on a pre-tax loss of $246 million. See note 11 to our consolidated financial statements.
Net Income (Loss) Attributable to Teva
Net income attributable to Teva was $282 million in the second quarter of 2025, compared to a net loss of $846 million in the second quarter of 2024. This change was mainly due to higher income taxes in the second quarter of 2024, as well as higher operating income in the second quarter of 2025, as discussed above.
Diluted Shares Outstanding and Earnings (Loss) per Share
The weighted average diluted shares outstanding used for the fully diluted share calculations for the three months ended June 30, 2025 and 2024 was 1,161 million shares and 1,133 million shares, respectively.
Diluted earnings per share was $0.24 in the second quarter of 2025, compared to diluted loss per share of $0.75 in the second quarter of 2024. See note 13 to our consolidated financial statements.
Share Count for Market Capitalization
We calculate share amounts using the outstanding number of shares (i.e., excluding treasury shares) plus shares that would be outstanding upon the exercise of options and vesting of RSUs and PSUs, and the conversion of our convertible senior debentures, in each case, at period end.
As of June 30, 2025 and 2024, the fully diluted share count for purposes of calculating our market capitalization was approximately 1,179 million shares and 1,167 million shares, respectively.
66
Impact of Currency Fluctuations on Results of Operations
In the second quarter of 2025, approximately 45% of our revenues were denominated in currencies other than the U.S. dollar. Since our results are reported in U.S. dollars, we are subject to significant foreign currency risks. Accordingly, changes in the rate of exchange between the U.S. dollar and local currencies in the markets in which we operate (primarily the euro, British pound, Russian ruble, Swiss franc, Canadian dollar, new Israeli shekel, Polish złoty and Swedish krona) impacted our results.
During the second quarter of 2025, the following main currencies relevant to our operations increased in value against the U.S. dollar (each compared on a quarterly average basis): Russian ruble by 12%, Swedish krona by 11%, Swiss franc by 9%, Polish złoty by 6%, British pound by 6%, euro by 5% and new Israeli shekel by 4%. The following currencies relevant to our operations decreased in value against the U.S. dollar: Argentine peso by 23%, Mexican peso by 12% and Brazilian real by 8%.
As a result, exchange rate movements during the second quarter of 2025, net of hedging effects, positively impacted revenues by $49 million and had a negligible impact on operating income, compared to the second quarter of 2024.
In the second quarter of 2025, a negative hedging impact of $32 million was recognized under revenues, and a positive hedging impact of $4 million was recognized under cost of sales. In the second quarter of 2024, a negative hedging impact of $2 million was recognized under revenues and a negative hedging impact of $3 million was recognized under cost of sales.
Hedging transactions against future projected revenues and expenses are recognized on the balance sheet at their fair value on a quarterly basis, while the foreign exchange impact on the underlying revenues and expenses may occur in subsequent quarters. See note 8d to our consolidated financial statements.
Commencing in the third quarter of 2018, the cumulative inflation in Argentina exceeded 100% or more over a three-year period. Although this triggered highly inflationary accounting treatment, it did not have a material impact on our results of operations.
Commencing in the second quarter of 2022, the cumulative inflation in Turkey exceeded 100% or more over a three-year period. Although this triggered highly inflationary accounting treatment, it did not have a material impact on our results of operations.
Comparison of six Months Ended June 30, 2025 to six Months Ended June 30, 2024
Unless specified otherwise, the factors used to explain quarterly changes on a year-over-year basis are also relevant for the comparison of the results for the six months ended June 30, 2025 and 2024. Where there are different factors affecting the six months comparison, we have described them below.
Segment Information
United States Segment
The following table presents revenues, expenses and profit for our United States segment for the six months ended June 30, 2025 and 2024:
| Six months ended June 30, | ||||||||||||||||
| 2025 | 2024 | |||||||||||||||
| (U.S. $ in millions / % of Segment Revenues) | ||||||||||||||||
| Revenues |
$ | 4,060 | 100 | % | $ | 3,835 | 100 | % | ||||||||
| Cost of sales |
1,752 | 43.1 | % | 1,809 | 47.2 | % | ||||||||||
| Gross profit |
2,308 | 56.9 | % | 2,025 | 52.8 | % | ||||||||||
| R&D expenses |
306 | 7.5 | % | 324 | 8.4 | % | ||||||||||
| S&M expenses |
552 | 13.6 | % | 530 | 13.8 | % | ||||||||||
| G&A expenses |
208 | 5.1 | % | 193 | 5.0 | % | ||||||||||
| Other loss (income) |
3 | § | (1 | ) | § | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Segment profit* |
$ | 1,239 | 30.5 | % | $ | 979 | 25.5 | % | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| * | Segment profit does not include amortization and certain other items. |
| § | Represents an amount less than 0.5%. |
67
United States Revenues
Revenues from our United States segment in the first six months of 2025 were $4,060 million, an increase of 6% compared to $3,835 million in the first six months of 2024.
Revenues by Major Products and Activities
The following table presents revenues for our United States segment by major products and activities for the six months ended June 30, 2025 and 2024:
| Six months ended June 30, | Percentage Change |
|||||||||||
| 2025 | 2024 | 2025-2024 | ||||||||||
| (U.S. $ in millions) | ||||||||||||
| Generic products (including biosimilars) |
$ | 1,809 | $ | 1,831 | (1 | %) | ||||||
| AJOVY |
117 | 87 | 34 | % | ||||||||
| AUSTEDO |
891 | 689 | 29 | % | ||||||||
| BENDEKA and TREANDA |
76 | 87 | (12 | %) | ||||||||
| COPAXONE |
116 | 111 | 5 | % | ||||||||
| UZEDY |
93 | 40 | 134 | % | ||||||||
| Anda |
738 | 754 | (2 | %) | ||||||||
| Other |
220 | 237 | (7 | %) | ||||||||
|
|
|
|
|
|||||||||
| Total |
$ | 4,060 | $ | 3,835 | 6 | % | ||||||
|
|
|
|
|
|||||||||
COPAXONE revenues in our United States segment in the first six months of 2025 were $116 million, an increase of 5% compared to $111 million in the first six months of 2024, mainly due to an increase in sales allowance due to a non-recurring item in the first six months of 2024, partially offset by market share erosion and competition.
United States Gross Profit
Gross profit from our United States segment in the first six months of 2025 was $2,308 million, an increase of 14%, compared to $2,025 million in the first six months of 2024.
Gross profit margin for our United States segment in the first six months of 2025 increased to 56.9% compared to 52.8% in the first six months of 2024.
United States R&D Expenses
R&D expenses relating to our United States segment in the first six months of 2025 were $306 million, a decrease of 5%, compared to $324 million in the first six months of 2024.
For a description of our R&D expenses in the first six months of 2025, see “—Teva Consolidated Results—Research and Development (R&D) Expenses” below.
United States S&M Expenses
S&M expenses relating to our United States segment in the first six months of 2025 were $552 million, an increase of 4%, compared to $530 million in the first six months of 2024.
United States G&A Expenses
G&A expenses relating to our United States segment in the first six months of 2025 were $208 million, an increase of 8%, compared to $193 million in the first six months of 2024.
United States Profit
Profit from our United States segment in the first six months of 2025 was $1,239 million, an increase of 27%, compared to $979 million in the first six months of 2024.
68
Europe Segment
The following table presents revenues, expenses and profit for our Europe segment for the six months ended June 30, 2025 and 2024:
| Six months ended June 30, | ||||||||||||||||
| 2025 | 2024 | |||||||||||||||
| (U.S. $ in millions / % of Segment Revenues) |
||||||||||||||||
| Revenues |
$ | 2,492 | 100.0 | % | $ | 2,485 | 100.0 | % | ||||||||
| Cost of sales |
1,117 | 44.8 | % | 1,070 | 43.1 | % | ||||||||||
| Gross profit |
1,374 | 55.2 | % | 1,415 | 56.9 | % | ||||||||||
| R&D expenses |
120 | 4.8 | % | 118 | 4.7 | % | ||||||||||
| S&M expenses |
427 | 17.1 | % | 403 | 16.2 | % | ||||||||||
| G&A expenses |
135 | 5.4 | % | 130 | 5.2 | % | ||||||||||
| Other loss (income) |
§ | § | § | § | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Segment profit* |
$ | 693 | 27.8 | % | $ | 764 | 30.8 | % | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| * | Segment profit does not include amortization and certain other items. |
| § | Represents an amount less than $0.5 million or 0.5%, as applicable. |
Europe Revenues
Our Europe segment includes the European Union, the United Kingdom, and certain other European countries.
Revenues from our Europe segment in the first six months of 2025 were $2,492 million, an increase of $7 million, compared to the first six months of 2024. In local currency terms, revenues increased by 1% compared to the first six months of 2024.
Revenues by Major Products and Activities
The following table presents revenues for our Europe segment by major products and activities for the six months ended June 30, 2025 and 2024:
| Six months ended June 30, | Percentage Change |
|||||||||||
| 2025 | 2024 | 2025-2024 | ||||||||||
| (U.S. $ in millions) | ||||||||||||
| Generic products (including OTC and biosimilars) |
$ | 2,029 | $ | 1,974 | 3 | % | ||||||
| AJOVY |
129 | 102 | 26 | % | ||||||||
| COPAXONE |
92 | 110 | (17 | %) | ||||||||
| Respiratory products |
110 | 123 | (11 | %) | ||||||||
| Other* |
132 | 175 | (25 | %) | ||||||||
|
|
|
|
|
|||||||||
| Total |
$ | 2,492 | $ | 2,485 | § | |||||||
|
|
|
|
|
|||||||||
| * | Other revenues in the first six months of 2025 include the sale of certain product rights. |
| § | Represents an amount less than 0.5%. |
Europe Gross Profit
Gross profit from our Europe segment in the first six months of 2025 was $1,374 million, a decrease of 3% compared to $1,415 million in the first six months of 2024.
69
Gross profit margin for our Europe segment in the first six months of 2025 decreased to 55.2% compared to 56.9% in the first six months of 2024.
Europe R&D Expenses
R&D expenses relating to our Europe segment in the first six months of 2025 were $120 million, an increase of 2% compared to $118 million in the first six months of 2024.
Europe S&M Expenses
S&M expenses relating to our Europe segment in the first six months of 2025 were $427 million, an increase of 6% compared to $403 million in the first six months of 2024.
Europe G&A Expenses
G&A expenses relating to our Europe segment in the first six months of 2025 were $135 million, an increase of 4% compared to the first six months of 2024.
Europe Profit
Profit from our Europe segment in the first six months of 2025 was $693 million, a decrease of 9% compared to $764 million in the first six months of 2024.
International Markets Segment
The following table presents revenues, expenses and profit for our International Markets segment for the six months ended June 30, 2025 and 2024:
| Six months ended June 30, | ||||||||||||||||
| 2025 | 2024 | |||||||||||||||
| (U.S. $ in millions / % of Segment Revenues) | ||||||||||||||||
| Revenues |
$ | 1,077 | 100 | % | $ | 1,190 | 100 | % | ||||||||
| Cost of sales |
556 | 51.6 | % | 607 | 51.0 | % | ||||||||||
| Gross profit |
521 | 48.4 | % | 583 | 49.0 | % | ||||||||||
| R&D expenses |
49 | 4.6 | % | 58 | 4.9 | % | ||||||||||
| S&M expenses |
232 | 21.5 | % | 263 | 22.1 | % | ||||||||||
| G&A expenses |
72 | 6.7 | % | 73 | 6.1 | % | ||||||||||
| Other loss (income) |
(2 | ) | § | (1 | ) | § | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Segment profit* |
$ | 171 | 15.9 | % | $ | 190 | 15.9 | % | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| * | Segment profit does not include amortization and certain other items. |
| § | Represents an amount less than 0.5%. |
International Markets Revenues
Our International Markets segment includes all countries in which we operate other than the United States and the countries included in our Europe segment.
Revenues from our International Markets segment in the first six months of 2025 were $1,077 million, a decrease of $113 million, or 9%, compared to the first six months of 2024. In local currency terms, revenues decreased by 6% compared to the first six months of 2024.
In the first six months of 2025, revenues were negatively impacted by exchange rate fluctuations of $47 million including hedging effects, compared to the first six months of 2024. Revenues in the first six months of 2025 included a negative hedging impact of $23 million compared to a negative hedging impact of $1 million in the first six months of 2024, which are included in “Other” in the table below. See note 8d to our consolidated financial statements.
70
Revenues by Major Products and Activities
The following table presents revenues for our International Markets segment by major products and activities for the six months ended June 30, 2025 and 2024:
| Six months ended June 30, |
Percentage Change |
|||||||||||
| 2025 | 2024 | 2025-2024 | ||||||||||
| (U.S. $ in millions) | ||||||||||||
| Generic products (including OTC and biosimilars) |
$ | 878 | $ | 963 | (9 | %) | ||||||
| AJOVY |
48 | 39 | 25 | % | ||||||||
| AUSTEDO |
18 | 26 | (33 | %) | ||||||||
| COPAXONE |
17 | 25 | (32 | %) | ||||||||
| Other* |
116 | 136 | (15 | %) | ||||||||
|
|
|
|
|
|||||||||
| Total |
$ | 1,077 | $ | 1,190 | (9 | %) | ||||||
|
|
|
|
|
|||||||||
| * | Other revenues in the first six months of 2025 include the sale of certain product rights. |
AJOVY revenues in our International Markets segment in the first six months of 2025 were $48 million, compared to $39 million in the first six months of 2024. This increase was mainly due to growth in existing markets in which AJOVY was launched.
International Markets Gross Profit
Gross profit from our International Markets segment in the first six months of 2025 was $521 million, compared to $583 million in the first six months of 2024. This decrease was mainly due to a negative hedging impact, as well as regulatory price reductions and generic competition to off-patented products in Japan.
Gross profit margin for our International Markets segment in the first six months of 2025 was 48.4%, compared to 49.0% in the first six months of 2024.
International Markets R&D Expenses
R&D expenses relating to our International Markets segment in the first six months of 2025 were $49 million, a decrease of 15% compared to $58 million in the first six months of 2024.
International Markets S&M Expenses
S&M expenses relating to our International Markets segment in the first six months of 2025 were $232 million, a decrease of 12% compared to $263 million in the first six months of 2024.
International Markets G&A Expenses
G&A expenses relating to our International Markets segment in the first six months of 2025 were $72 million, a decrease of 1% compared to $73 million in the first six months of 2024.
International Markets Profit
Profit from our International Markets segment in the first six months of 2025 was $171 million, a decrease of 10%, compared to $190 million in the first six months of 2024.
Other Activities
We have other sources of revenues, primarily the sale of APIs to third parties, certain contract manufacturing services and an out-licensing platform offering a portfolio of products to other pharmaceutical companies through our affiliate Medis. Our other activities are not included in our United States, Europe or International Markets segments described above.
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On January 31, 2024, we announced that we intend to divest our API business (including its R&D, manufacturing and commercial activities) through a sale. The intention to divest is in alignment with our Pivot to Growth strategy. However, there can be no assurance regarding the ultimate timing or structure of a potential divestiture or that a divestiture will be agreed or completed at all. For further information, see note 2 to our consolidated financial statements.
Our revenues from other activities in the first six months of 2025 were $438 million, a decrease of 8% in both U.S. dollars and local currency terms, compared to the first six months of 2024.
API sales to third parties in the first six months of 2025 were $265 million, a decrease of 5% in both U.S. dollars and local currency terms compared to the first six months of 2024.
Teva Consolidated Results
Revenues
Revenues in the first six months of 2025 were $8,067 million, an increase of 1% compared to the first six months of 2024. In local currency terms, revenues increased by 2%, compared to the first six months of 2024. This increase was mainly due to an increase in revenues from our key innovative products AUSTEDO, AJOVY and UZEDY, partially offset by a decrease in revenues from certain other innovative products and lower revenues from generic products in our International Markets segment associated with the divestment of our business venture in Japan, as well as in our U.S. segment.
See “—United States Revenues,” “—Europe Revenues,” “—International Markets Revenues” and “—Other Activities” above.
Exchange rate movements during the first six months of 2025, net of hedging effects, negatively impacted revenues by $53 million, compared to the first six months of 2024. See note 8d to our consolidated financial statements.
Gross Profit
Gross profit in the first six months of 2025 was $3,979 million, an increase of 5% compared to the first six months of 2024.
Gross profit margin was 49.3% in the first six months of 2025, compared to 47.5% in the first six months of 2024.
Research and Development (R&D) Expenses, net
R&D expenses, net in the first six months of 2025 were $490 million, a decrease of 4% compared to the first six months of 2024.
R&D expenses, net as a percentage of revenues were 6.1% in the first six months of 2025, compared to 6.4% in the first six months of 2024.
Selling and Marketing (S&M) Expenses
S&M expenses in the first six months of 2025 were $1,276 million, an increase of 1% compared to the first six months of 2024.
S&M expenses as a percentage of revenues were 15.8% in the first six months of 2025 and 2024.
General and Administrative (G&A) Expenses
G&A expenses in the first six months of 2025 were $603 million, an increase of 7% compared to the first six months of 2024.
G&A expenses as a percentage of revenues were 7.5% in the first six months of 2025, compared to 7.0% in the first six months of 2024.
Intangible Asset Impairments
We recorded expenses of $163 million for identifiable intangible asset impairments in the first six months of 2025, compared to expenses of $141 million in the first six months of 2024. See note 5 to our consolidated financial statements.
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Goodwill Impairment
No goodwill impairment charges were recorded in the first six months of 2025, compared to a goodwill impairment charge of $400 million related to Teva’s API reporting unit recorded in the first six months of 2024. See note 6 to our consolidated financial statements.
Other Asset Impairments, Restructuring and Other Items
We recorded expenses of $210 million for other asset impairments, restructuring and other items in the first six months of 2025, compared to expenses of $954 million in the first six months of 2024. See note 12 to our consolidated financial statements.
Legal Settlements and Loss Contingencies
We recorded expenses of $252 million in legal settlements and loss contingencies in the first six months of 2025, compared to expenses of $188 million in the first six months of 2024. See note 9 to our consolidated financial statements.
Other Income (Loss)
Other loss in the first six months of 2025 was $9 million, compared to other income of $1 million in the first six months of 2024.
Operating Income (Loss)
Operating income was $975 million in the first six months of 2025, compared to an operating loss of $223 million in the first six months of 2024.
Operating income as a percentage of revenues was 12.1% in the first six months of 2025, compared to an operating loss as a percentage of revenues of 2.8% in the first six months of 2024.
Financial Expenses, Net
In the first six months of 2025, financial expenses, net were $477 million, mainly comprised of net-interest expenses of $415 million. In the first six months of 2024, financial expenses, net were $491 million, mainly comprised of net-interest expenses of $466 million.
Reconciliation Table to Consolidated Income (Loss) Before Income Taxes
The following table presents a reconciliation of our segment profits to our consolidated operating income (loss) and to consolidated income (loss) before income taxes for the six months ended June 30, 2025 and 2024:
| Six months ended June 30, |
||||||||
| 2025 | 2024 | |||||||
| (U.S. $ in millions) | ||||||||
| United States profit |
$ | 1,239 | $ | 979 | ||||
| Europe profit |
693 | 764 | ||||||
| International Markets profit |
171 | 190 | ||||||
|
|
|
|
|
|||||
| Total reportable segments profit |
2,102 | 1,933 | ||||||
| Profit (loss) of other activities |
(23 | ) | 15 | |||||
|
|
|
|
|
|||||
| Total segments profit |
2,079 | 1,948 | ||||||
| Amounts not allocated to segments: |
||||||||
| Amortization |
292 | 298 | ||||||
| Other assets impairments, restructuring and other items |
210 | 954 | ||||||
| Goodwill impairment |
— | 400 | ||||||
| Intangible assets impairments |
163 | 141 | ||||||
| Legal settlements and loss contingencies |
249 | 188 | ||||||
| Other unallocated amounts |
190 | 190 | ||||||
|
|
|
|
|
|||||
| Consolidated operating income (loss) |
975 | (223 | ) | |||||
|
|
|
|
|
|||||
| Financial expenses, net |
477 | 491 | ||||||
|
|
|
|
|
|||||
| Consolidated income (loss) before income taxes |
$ | 497 | $ | (713 | ) | |||
|
|
|
|
|
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Income Taxes
In the first six months of 2025, we recognized a tax benefit of $4 million, on pre-tax income of $497 million. In the first six months of 2024, we recognized a tax expense of $578 million, on pre-tax loss of $713 million. See note 11 to our consolidated financial statements.
Net Income (Loss) Attributable to non-controlling interests
Net income attributable to redeemable and non-redeemable non-controlling interests was $6 million in the first six months of 2025, compared to a net loss attributable to redeemable and non-redeemable non-controlling interests of $309 million in the first six months of 2024. The net loss in the first six months of 2024 was mainly due to higher impairments of tangible assets, largely related to the classification of our business venture in Japan as held for sale. See note 12 to our consolidated financial statements.
Net Income (Loss) Attributable to Teva
Net income attributable to Teva was $497 million in the first six months of 2025, compared to a net loss of $985 million in the first six months of 2024.
Diluted Shares Outstanding and Earnings (Loss) per Share
The weighted average diluted shares outstanding used for the fully diluted share calculations for the six months ended June 30, 2025 and 2024 was 1,159 million shares and 1,128 million shares, respectively.
Diluted earnings per share was $0.43 for the six months ended June 30, 2025, compared to diluted loss per share of $0.87 for the six months ended June 30, 2024. See note 13 to our consolidated financial statements.
Impact of Currency Fluctuations on Results of Operations
In the first six months of 2025, approximately 46% of our revenues were denominated in currencies other than the U.S. dollar. Because our results are reported in U.S. dollars, we are subject to significant foreign currency risks and, accordingly, changes in the exchange rate between the U.S. dollar and local currencies in markets in which we operate (primarily the euro, British pound, Swiss franc, Russian ruble, Canadian dollar, new Israeli shekel, Polish złoty, Japanese yen and Swedish krona) impacted our results.
During the first six months of 2025, the following main currencies relevant to our operations increased in value against the U.S. dollar: Russian ruble by 4%, Swedish krona by 3%, Swiss franc by 3%, Polish złoty by 3%, new Israeli shekel by 3%, British pound by 2% and Japanese Yen by 2% (all compared on a six-month average basis). The following main currencies relevant to our operations decreased in value against the U.S. dollar: Argentine peso by 22%, Turkish lira by 16%, Mexican peso by 14%, Brazilian real by 12%, Ukraine hryvna by 6%, Canadian dollar by 4% and Indian rupee by 3%.
As a result, exchange rate movements during the first six months of 2025, net of hedging effects, negatively impacted overall revenues by $53 million and our operating income by $51 million, compared to the first six months of 2024.
In the first six months of 2025, a negative hedging impact of $60 million was recognized under revenues, and a positive hedging impact of $3 million was recognized under cost of sales. In the first six months of 2024, a positive hedging impact of $10 million was recognized under revenues and a negative hedging impact of $6 was recognized under cost of sales.
Hedging transactions against future projected revenues and expenses are recognized on the balance sheet at their fair value on a quarterly basis, while the foreign exchange impact on the underlying revenues and expenses may occur in subsequent quarters. See note 8d to our consolidated financial statements.
2025 Aggregated Contractual Obligations
There have not been any material changes in our assessment of material contractual obligations and commitments as set forth in Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2024.
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Liquidity and Capital Resources
Total balance sheet assets were $40,131 million as of June 30, 2025, compared to $39,326 million as of December 31, 2024.
Our working capital balance, which includes accounts receivables net of SR&A, inventories, prepaid expenses and other current assets, accounts payables, employee-related obligations, accrued expenses and other current liabilities, was negative $2,446 million as of June 30, 2025, compared to negative $2,837 million as of December 31, 2024. This increase was mainly due to higher inventory levels primarily due to exchange rate fluctuations, and an increase in accounts receivables, net of SR&A, as well as a decrease in employee related obligations mainly due to performance incentive payments to employees for 2024, partially offset by an increase in accounts payables and accrued expenses primarily due to exchange rate fluctuations.
Employee-related obligations, as of June 30, 2025 were $481 million, compared to $624 million as of December 31, 2024. The decrease in the first six months of 2025 was mainly due to performance incentive payments to employees for 2024, partially offset by an accrual for performance incentive payments to employees for 2025.
Cash investment in property, plant and equipment and intangible assets in the second quarter of 2025 was $96 million, compared to $97 million in the second quarter of 2024. Depreciation in the second quarter of 2025 was $103 million, compared to $113 million in the second quarter of 2024.
Cash and cash equivalents as of June 30, 2025, were $2,161 million, compared to $3,300 million as of December 31, 2024. See also the statement of cash flow to our consolidated financial statements.
In the first quarter of 2025, we paid a dividend of $340 million to redeemable non-controlling interests in our business venture in Japan.
Our cash on hand that is not used for ongoing operations is generally invested in bank deposits as well as liquid securities that bear fixed and floating rates.
Teva’s principal sources of short-term liquidity are its cash on hand, existing cash investments, liquid securities and available credit facilities, primarily our $1.8 billion unsecured syndicated sustainability-linked revolving credit facility, entered into in April 2022, as amended in February 2023 and in May 2024 (“RCF”). See note 7 to our consolidated financial statements.
Debt Balance and Movements
As of June 30, 2025, our debt was $17,227 million, compared to $17,783 million as of December 31, 2024. This decrease was mainly due to repayment at maturity of $1,368 million of our senior notes (as detailed below), partially offset by $780 million of exchange rate fluctuations. Additionally, during the second quarter of 2025, we repurchased $2,290 million aggregate principal amount of notes upon consummation of a cash tender offer, and issued $2,305 million of senior notes, net of discount and issuance costs. For further information, see note 7 to our consolidated financial statements.
In January 2025, we repaid $426 million of our 6% senior notes at maturity.
In January 2025, we repaid $427 million of our 7.13% senior notes at maturity.
In March 2025, we repaid $515 million of our 4.50% senior notes at maturity.
In July 2025, we repaid $444 million of our 1% senior notes at maturity.
As of June 30, 2025, our debt was effectively denominated in the following currencies: 55% in U.S. dollars, 42% in euros and 3% in Swiss francs.
The portion of total debt classified as short-term as of June 30, 2025 was 3% compared to 10% as of December 31, 2024.
Our financial leverage, which is the ratio between our debt and the sum of our debt and equity, was 72% as of June 30, 2025, compared to 77% as of December 31, 2024. Our average debt maturity was approximately 5.95 years as of June 30, 2025, compared to 5.5 years as of December 31, 2024.
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Total Equity
Total equity was $6,834 million as of June 30, 2025, compared to $5,380 as of December 31, 2024. This increase was mainly due to a positive impact from exchange rate fluctuations of $694 million and a net income attributable to Teva of $497 million.
Exchange rate fluctuations affected our balance sheet, as approximately 80% of our net assets as of June 30, 2025 (including both monetary and non-monetary assets) were in currencies other than the U.S. dollar. When compared to December 31, 2024, changes in currency rates as of June 30, 2025 had a positive impact of $694 million on our equity. The following main currencies increased in value against the U.S. dollar: Russian ruble by 29%, Polish złoty by 12%, Swiss franc by 12%, Bulgarian lev by 11%, euro by 11%, Mexican peso by 9%, British pound by 9% and Japanese yen by 8%. All comparisons are on a year-to-date basis.
Cash Flow
We continually seek to improve the efficiency of our working capital management. Periodically, as part of our cash and commercial relationship management activities, we make decisions in our commercial and supply chain activities which drive an acceleration of receivable payments from customers, or deceleration of payments to vendors. This has the effect of increasing or decreasing cash from operations during any given period. Increased cash from operations has the effect of reducing our leverage ratio, which is measured net of cash and cash equivalents, as of the end of such period. In connection with strategic continual improvement, we obtained more favorable payment terms from many of our vendors which are expected to continue in future periods. In addition, in periods in which receivable payments from customers are delayed, we have and expect we may in the future extend the time to pay certain vendors, so as to balance our liquidity position. Such decisions have had and may in the future have a material impact on our annual operating cash flow measurement, as well as on our quarterly results.
Cash flow generated from operating activities during the second quarter of 2025 was $227 million, compared to $103 million of cash flow generated from operating activities in the second quarter of 2024. The higher cash flow generated from operating activities in the second quarter of 2025 resulted mainly from higher profit in our U.S. segment, and a positive impact from accounts receivables, net of SR&A mainly due to collection timing, partially offset by higher sequential inventory levels, as well as higher tax payments.
During the second quarter of 2025, we generated free cash flow of $476 million, which we define as comprising $227 million in cash flow generated from operating activities, $336 million in beneficial interest collected in exchange for securitized accounts receivables (under our EU securitization program) and $9 million of proceeds from divestitures of businesses and other assets, partially offset by $96 million in cash used for capital investment. During the second quarter of 2024, we generated free cash flow of $324 million, which we define as comprising $103 million in cash flow generated from operating activities, $317 million in beneficial interest collected in exchange for securitized accounts receivables (under our EU securitization program) and $1 million in divestitures of businesses and other assets, partially offset by $97 million in cash used for capital investment. The increase in the second quarter of 2025 resulted mainly from higher cash flow generated from operating activities.
Dividends
We have not paid dividends on our ordinary shares or American Depositary Shares (ADSs) since December 2017.
Commitments
In addition to financing obligations under short-term debt and long-term senior notes and loans, debentures and convertible debentures, our major contractual obligations and commercial commitments include leases, royalty payments, contingent payments pursuant to acquisition agreements, collaboration agreements, development funding agreements and participation in joint ventures associated with R&D activities. For further information on our agreements with mAbxience, Launch Therapeutics and Abingworth, Biolojic Design, Royalty Pharma, Sanofi, Modag, Alvotech, Takeda and MedinCell, see note 2 to our consolidated financial statements.
We are committed to paying royalties to owners of know-how, partners in alliances and certain other arrangements, and to parties that financed R&D at a wide range of rates as a percentage of sales of certain products, as defined in the agreements. In some cases, the royalty period is not defined; in other cases, royalties will be paid over various periods not exceeding 20 years.
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In connection with certain development, supply and marketing, and research and collaboration or services agreements, we are required to indemnify, in unspecified amounts, the parties to such agreements against third-party claims relating to (i) infringement or violation of intellectual property or other rights of such third party; or (ii) damages to users of the related products. Except as described in our financial statements, we are not aware of any material pending action that may result in the counterparties to these agreements claiming such indemnification.
Non-GAAP Net Income and Non-GAAP EPS Data
We present non-GAAP net income and non-GAAP earnings per share (“EPS”) as management believes that such data provide useful information to investors because they are used by management and our Board of Directors, in conjunction with other performance metrics, to evaluate our operational performance, to prepare and evaluate our work plans and annual budgets and ultimately to evaluate the performance of management, including annual compensation. While other qualitative factors and judgment also affect annual compensation, the principal quantitative element in the determination of such compensation are performance targets tied to the work plan, which are based on these non-GAAP measures.
Non-GAAP financial measures have no standardized meaning and accordingly have limitations in their usefulness to investors. Investors are cautioned that, unlike financial measures prepared in accordance with U.S. GAAP, non-GAAP measures may not be comparable with the calculation of similar measures for other companies. These non-GAAP financial measures are presented solely to permit investors to more fully understand how management assesses our performance. The limitations of using non-GAAP financial measures as performance measures are that they provide a view of our results of operations without including all events during a period and may not provide a comparable view of our performance to other companies in the pharmaceutical industry. Investors should consider non-GAAP net income and non-GAAP EPS in addition to, and not as replacements for, or superior to, measures of financial performance prepared in accordance with GAAP.
In preparing our non-GAAP net income and non-GAAP EPS data, we exclude items that either have a non-recurring impact on our financial performance or which, in the judgment of our management, are items that, either as a result of their nature or size, could, were they not excluded, potentially cause investors to extrapolate future performance from an improper base that is not reflective of our underlying business performance. Certain of these items are also excluded because of the difficulty in predicting their timing and scope. The items excluded from our non-GAAP net income and non-GAAP EPS include:
| • | amortization of purchased intangible assets; |
| • | certain legal settlements and material litigation fees and/or loss contingencies, due to the difficulty in predicting their timing and scope; |
| • | impairments of long-lived assets, including intangibles, property, plant and equipment and goodwill; |
| • | restructuring expenses, including severance, retention costs, contract cancellation costs and certain accelerated depreciation expenses primarily related to the rationalization of our plants or to certain other strategic activities, such as the realignment of R&D focus or other similar activities; |
| • | acquisition- or divestment- related items, including changes in contingent consideration, integration costs, banker and other professional fees and inventory step-up; |
| • | expenses related to our equity compensation; |
| • | significant one-time financing costs, amortization of issuance costs and terminated derivative instruments, and marketable securities investment valuation gains/losses; |
| • | unusual tax items; |
| • | other awards or settlement amounts, either paid or received; |
| • | other exceptional items that we believe are sufficiently large that their exclusion is important to facilitate an understanding of trends in our financial results, such as impacts due to significant costs for remediation of plants, or other unusual events; and |
| • | corresponding tax effects of the foregoing items. |
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The following tables present our non-GAAP net income and non-GAAP EPS for the three and six months ended June 30, 2025 and 2024, as well as reconciliations of each measure to their nearest GAAP equivalents:
| Three months ended June 30, |
Six months ended June 30, |
|||||||||||||||||||||||
| ($ in millions except per share amounts) | 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Net income (Loss) attributable to Teva |
($ | ) | 282 | (846 | ) | ($ | ) | 497 | (985 | ) | ||||||||||||||
| Increase (decrease) for excluded items: |
||||||||||||||||||||||||
| Amortization of purchased intangible assets |
148 | 146 | 292 | 298 | ||||||||||||||||||||
| Legal settlements and loss contingencies(1) |
166 | 83 | 249 | 188 | ||||||||||||||||||||
| Goodwill impairment(2) |
— | 400 | — | 400 | ||||||||||||||||||||
| Impairment of long-lived assets(3) |
99 | 130 | 177 | 809 | ||||||||||||||||||||
| Restructuring costs(4) |
154 | 18 | 168 | 31 | ||||||||||||||||||||
| Equity compensation |
38 | 32 | 72 | 60 | ||||||||||||||||||||
| Contingent consideration(5) |
19 | 192 | 30 | 271 | ||||||||||||||||||||
| Accelerated depreciation |
— | — | — | 7 | ||||||||||||||||||||
| Financial expenses |
37 | 12 | 51 | 24 | ||||||||||||||||||||
| Redeemable and non-redeemable non-controlling interests(6) |
— | (33 | ) | 2 | (317 | ) | ||||||||||||||||||
| Other non-GAAP items(7) |
53 | 59 | 116 | 106 | ||||||||||||||||||||
| Corresponding tax effects and unusual tax items(8) |
(228 | ) | 503 | ($ | ) | (283 | ) | 353 | ||||||||||||||||
| Non-GAAP net income attributable to Teva |
($ | ) | 769 | 697 | 1,371 | 1,245 | ||||||||||||||||||
| Non-GAAP tax rate(9) |
16.4 | % | 15.4 | % | ($ | ) | 16.9 | % | 15.2 | % | ||||||||||||||
| GAAP diluted earnings (loss) per share attributable to Teva |
($ | ) | 0.24 | (0.75 | ) | 0.43 | (0.87 | ) | ||||||||||||||||
| EPS difference(10) |
0.42 | 1.35 | ($ | ) | 0.75 | 1.96 | ||||||||||||||||||
| Non-GAAP diluted EPS attributable to Teva(10) |
($ | ) | 0.66 | 0.61 | 1.18 | 1.09 | ||||||||||||||||||
| Non-GAAP average number of shares (in millions)(10) |
1,161 | 1,151 | 1,159 | 1,146 | ||||||||||||||||||||
| (1) | For the three and six months ended June 30, 2025, adjustments of legal settlements and loss contingencies mainly consisted of (a) an update to the estimated settlement provision for the opioid cases (mainly the effect of the passage of time on the net present value of the discounted payments) in the amount of $47 million and $97 million, respectively, and (b) an update to the estimated provision recorded for the claims brought by attorneys general representing states and territories throughout the United States in the generic drug antitrust litigation in the amount of $55 million. |
| (2) | A goodwill impairment charge of $400 million related to our Teva’s API reporting unit was recognized in the three and six months ended June 30, 2024. |
| (3) | For the three months ended June 30, 2025, the adjustment for impairment of long-lived assets consisted of (a) impairment of long-lived assets of $42 million mainly related to products in the U.S. and Europe, and (b) $55 million related to the held for sale measurement of the API business (including its R&D, manufacturing and commercial activities), which includes a favorable impact related to the expected gain from the reclassification of currency translation adjustments. For the six months ended June 30, 2025, the adjustment for impairment of long-lived assets was mainly related to products in the U.S. and Europe. For the six months ended June 30, 2024, adjustments for impairment of long-lived assets primarily consisted of $644 million related to the classification of our business venture in Japan as held for sale. |
| (4) | In the three and six months ended June 30, 2025, Teva recorded $154 million and $168 million, respectively, of restructuring expenses primarily related to optimization activities in connection with Teva’s Transformation programs related to Teva’s global organization and operations mainly through headcount reduction. |
| (5) | In the three and six months ended June 30, 2024, adjustments for contingent consideration primarily related to a change in the estimated future royalty payments to Allergan in connection with lenalidomide capsules (the generic version of Revlimid®), of $174 million and $238 million, respectively. |
| (6) | For the six months ended June 30, 2024, the adjustment is related to non-controlling interests portion of long-lived assets impairment of $644 million related to the classification of our business venture in Japan as held for sale. |
| (7) | Other non-GAAP items include other exceptional items that we believe are sufficiently large that their exclusion is important to facilitate an understanding of trends in our financial results, primarily related to the rationalization of our plants, accelerated depreciation, certain inventory write-offs, material litigation fees and other unusual events. |
| (8) | Adjustments for corresponding tax effects and unusual tax items exclusively consisted of the tax impact directly attributable to the pre-tax items that are excluded from non-GAAP net income included in the other adjustments to this table. For the three months ended June 30, 2024, adjustments of $503 million mainly related to the settlement agreement with the ITA to settle certain litigation with respect to taxes payable for the Company’s taxable years 2008 through 2020, in an amount of $495 million. |
| (9) | Non-GAAP tax rate is tax expenses (benefit) excluding the impact of non-GAAP tax adjustments presented above as a percentage of income (loss) before income taxes excluding the impact of non-GAAP adjustments presented above. |
| (10) | EPS difference and diluted non-GAAP EPS are calculated by dividing our non-GAAP net income attributable to Teva by our non-GAAP diluted weighted average number of shares. |
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Off-Balance Sheet Arrangements
We do not have any material off-balance sheet arrangements, except for: (i) surety underwritten guarantees Teva has provided the European Commission in an amount of euro 462.2 million, together with specified post-decision interest, which remain in force for three years, and which includes substantially similar covenants as our RCF, as disclosed in note 10 to our consolidated financial statements, and (ii) securitization transactions, which are disclosed in note 10f to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2024.
Critical Accounting Policies
For a summary of our significant accounting policies, see note 1 to our consolidated financial statements and “Critical Accounting Policies” included in our Annual Report on Form 10-K for the year ended December 31, 2024.
Recently Issued Accounting Pronouncements
See note 1 to our consolidated financial statements.
| ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
There has not been any material change in our assessment of market risk as set forth in Item 7A to our Annual Report on Form 10-K for the year ended December 31, 2024.
| ITEM 4. | CONTROLS AND PROCEDURES |
Disclosure Controls and Procedures
Teva maintains “disclosure controls and procedures” (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) that are designed to provide reasonable assurance that information required to be disclosed in Teva’s reports filed or submitted under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to Teva’s management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objective.
After evaluating the effectiveness of our disclosure controls and procedures as of June 30, 2025, our Chief Executive Officer and Chief Financial Officer concluded that, as of such date, Teva’s disclosure controls and procedures were effective at the reasonable assurance level.
Changes in Internal Control over Financial Reporting
During the three months ended June 30, 2025, there were no changes in internal control over financial reporting that materially affected or are reasonably likely to materially affect Teva’s internal control over financial reporting.
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ITEM 1. |
LEGAL PROCEEDINGS |
ITEM 1A. |
RISK FACTORS |
ITEM 2. |
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
ITEM 3. |
DEFAULTS UPON SENIOR SECURITIES |
ITEM 4. |
MINE SAFETY DISCLOSURES |
ITEM 5. |
OTHER INFORMATION |
Name and Title |
Date |
Action |
Expiration Date |
Maximum Shares Subject to Plan (1)
|
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Placid Jover, Executive Vice President, Chief Human Resources Officer |
June 9, 2025 | Adopted | August 5, 2025 | 12,827 | ||||||||||||
|
(1) |
The plan includes shares to be sold solely to cover tax withholding obligations. |
| ITEM 6. | EXHIBITS |
| * | Filed herewith. |
81
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| TEVA PHARMACEUTICAL INDUSTRIES LIMITED |
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| Date: July 30, 2025 |
By: |
/s/ Eli Kalif | ||||
| Name: |
Eli Kalif | |||||
| Title: |
Executive Vice President, Chief Financial Officer (Duly Authorized Officer) |
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82
Exhibit 10.1
Execution Version
Amendment No. 1 to Employment Agreement
This Amendment to the Employment Agreement (the “Amendment”) is entered into on this 5 day of June 2025 (the “Effective Amendment Date”) and is made by and between TEVA PHARMACEUTICAL INDUSTRIES LTD., an Israeli corporation located at 124 Dvora HaNevi’a Street, Tel Aviv, Israel, Company No. 52-001395-4 (the “Company” or “Teva”), and Richard Francis (“Executive”).
WHEREAS, the Company and the Executive are parties to that certain Employment Agreement dated November 21, 2022 (the “Agreement”) which details the terms of the Executive’s employment with the Company; and
WHEREAS, the Company and the Executive now wish to amend certain provisions of the Agreement and desire to memorialize such amendment to the Agreement in this Amendment;
NOW, THEREFORE, in consideration of the covenants and agreements herein contained, the parties have agreed as follows:
| 1. | Capitalized Terms. Capitalized terms used in this Amendment and not otherwise defined herein, shall bear the meaning ascribed to them in the Agreement. |
Amendments to the Agreement.
| 2. | Section 1.1 to the Agreement is hereby replaced in its entirely to read as follows: |
“The Company agrees to employ Executive, and Executive agrees to serve the Company and its affiliates, subject to the terms and conditions of this Agreement, for the period commencing on January 1, 2023 (the date Executive’s service to the Company commenced, “Effective Date”) and ending on the date that Executive’s employment lawfully terminates, in accordance with the provisions of Section 9 of this Agreement (the “Term”).”
| 3. | Section 1.7 to the Agreement is hereby replaced in its entirely to read as follows: |
“This Agreement, as amended, and all compensation and benefits payable hereunder are subject to the Company’s compensation policies applicable to senior officers in effect on the Effective Date and the terms and conditions of this Agreement, including the Company’s Compensation Policy for Executive Officers and Directors brought to shareholder approval at the 2025 annual general meeting of shareholders (collectively, the “Compensation Policy”)”.
| 4. | Section 2.1 of the Agreement is hereby amended by adding the following paragraph immediately following the end of Section 2.1: |
“Notwithstanding the forgoing, commencing on January 1, 2025, the Annual Salary shall be increased to $1,700,000. Notwithstanding the above, the Compensation Committee and the Board may, without the need for further action or approval of the shareholders, increase the gross annual base salary of the Executive by up to 7.5% each calendar year. Executive shall begin to be paid this increased salary immediately following the date of the 2025 Annual General Meeting and be paid the prorated amount for the term commencing on January 1, 2025 and ending on the date of the 2025 Annual General Meeting, in a single lump sum no later than the second regularly scheduled payroll immediately following the 2025 annual shareholders meeting.”
| 5. | Section 3.2 is hereby amended by: |
| 5.1 | adding the following sentence immediately after the sentence ending with “performance measures established by the Compensation Committee and the Board”: |
“Notwithstanding the forgoing, effective for the fiscal year commencing on January 1, 2025 and for each of the subsequent fiscal years during the Term, the maximum Annual Bonus opportunity shall be 200% of Target Bonus if performance goals are achieved according to the Bonus plan of the relevant year the actual amount of which shall be determined in good faith by the Compensation Committee and the Board, based on their determination of the attainment of performance measures established by the Compensation Committee and the Board.”
| 5.2 | deleting the words “and except in the case of non renewal of this Agreement pursuant to Section 1.1,”. |
| 6. | Section 4.2 of the Agreement is hereby amended by adding the following paragraph immediately following the end of Section 4.2: |
“Notwithstanding the foregoing, for the fiscal year commencing on January 1, 2025 and for each of the subsequent fiscal years during the Term, Executive shall be granted equity awards with a grant date monetary value, defined as the greater of grant date fair value or target value, of no less than $10,000,000 (ten Million United States Dollars) and no more than $16,000,000 (sixteen Million United States Dollars) per year, the exact amount to be determined each year in good faith by the Compensation Committee and the Board, without the need for further action or approval of the shareholders, with 70% of each such award to be granted as PSUs and 30% of each such award to be granted as RSUs. For the fiscal year commencing on January 1, 2025, the Executive shall be granted equity awards in the amount of $12,000,000, of which $9,000,000 was granted in March 2025 and the remainder, in an amount of $3,000,000 (the “Additional 2025 Annual Award”, which once granted shall be deemed part of the 2025 Annual Grant), will be granted on the date of the 2025 annual shareholders meeting (or if such date occurs during a trading blackout period, then on the date that is seven days following end of such blackout period) (the date of such grant, the “Additional Grant Date”) and subject to the terms of this section. The Additional 2025 Annual Award shall consist of 30% RSUs and 70% PSUs. The performance goals and related vesting criteria for such Additional 2025 Annual Award shall be identical to those applicable to the RSUs and PSUs granted to Executive in March 2025, provided that the grant date for the purpose of the vesting of the Additional 2025 Annual Award will be the Additional Grant Date. For the avoidance of doubt, all annual equity awards granted to Executive in fiscal year 2026 and later will be granted not later than the end of the first quarter of the applicable fiscal year to which the awards relate, in each case subject to the terms of the 2020 Plan (or any successor thereto), and all such awards shall, except as otherwise specified in this clause 4.2, be subject to the same vesting terms as the corresponding Share awards granted to other senior executives of the Company generally.”
| 7. | Section 5.2 shall be replaced in its entirely to read as follows: |
“Commencing on the 2025 annual shareholders meeting and during the Term, Executive shall be entitled to an annual cash allowance of $200,000 (USD).The annual allowance will not be considered for the calculation of all social benefits (or their equivalent) paid to Executive pursuant to this Agreement (including any payments or contributions related to the Severance Contribution and Pension Benefit) and for any other purpose or benefit plan for which such payments are calculated based on a percentage of Executive’s salary. For 2025, the amount shall be prorated for the portion of the year following the 2025 annual shareholders meeting, while the original provisions of this section shall apply for the period prior to the 2025 annual shareholders meeting. In addition, the Executive shall be entitled to reimbursement of air travel to and from Israel and related accommodation expenses in Israel for the Executive’s travel for business purposes. In addition, the Executive and his family members will be eligible for global health insurance as provided by the Company. The above benefits under this section 5.2 will not be grossed up for tax purposes. In addition to the above, if determined necessary by the HR and Compensation Committee acting in good faith, security services will be provided to Executive and/or his family when Executive travels for business or personal purposes at the Company’s cost, such amounts to be grossed up for tax purposes and social security contributions in accordance with Company policy on such reimbursements.”
| 8. | Section 6.2 of the Agreement is hereby amended by deleting the words “and a car benefit suitable for the chief executive officer of a company of the size and nature of the Company,” |
| 9. | Section 6.3 shall be deleted in its entirely, provided however that the original provisions of this section shall apply for the Term until the 2025 annual shareholders meeting. |
| 10. | Section 9.4.2 of the Agreement is hereby amended by deleting the words “, which shall be paid in a lump sum on the thirtieth (30th) day after the Date of Termination, other than those components of the Severance Payment required by Law to be paid earlier, which components shall be paid in accordance with the requirements of applicable Law”. |
| 11. | Section 9.4.6 shall be deleted and shall be marked as “[reserved]”. |
| 12. | Section 9.4.7 of the Agreement shall be replaced in its entirely to read as follows: |
“If such termination occurs within one (1) year following the date of a “Change in Control” (as described in the Compensation Policy), then, in addition to the payments and benefits set forth in Sections 9.4.1 through 9.4.6, (i) Executive shall be entitled to be paid the Merger Amount (as defined below), which shall be paid in a lump sum on the thirtieth (30th) day after the Date of Termination, and (ii) all equity awards granted to Executive by the Company will be subject to accelerated vesting as provided for in the 2020 Plan (or any successor thereto), and PSUs granted shall be earned based on the greater of target or actual performance.”
| 13. | The following sentence will be added to the end of Section 9.5: |
“In addition, in the event of a termination of employment by Executive without Good Reason that constitutes an Early Retirement or Qualified Retirement, the Executive shall be entitled to the applicable Equity Benefits.”
| 14. | Section 9.6 (termination upon non-renewal) shall be deleted and shall be marked as “[reserved]”. |
| 15. | Section 9.9.5(c) is hereby replaced in its entirely to read as follows: |
“Annual Equity Awards:
| i. | In the event of termination of employment hereunder by reason of death or Disability, any equity awards granted pursuant to Section 4.2 will be subject to accelerated vesting as provided for in the 2020 Plan (or any successor thereto). |
| ii. | In the event of (i) termination by the Company without Cause or (ii) in the event of termination by Executive with Good Reason or (iii) in the event of termination of employment by Executive without Good Reason that constitutes an Early Retirement, any then outstanding equity awards granted pursuant to Section 4.2 (Annual Equity Awards) (excluding, in the case of an Early Retirement, any equity awards for which the grant date is at least six (6) months prior to the date of the Early Retirement) will be subject to prorated vesting based on the number of full months elapsed between the grant date and the date of termination of employment out of the total number of months in the vesting period, less any shares that have already vested, with such prorated vested portion delivered on the next vesting date with respect to time-vested RSUs and on the original vesting schedule of the award for PSUs (without acceleration) (PSUs will based on actual performance). For the avoidance of doubt, in the case of an Early Retirement, any equity awards granted pursuant to Section 4.2 (Annual Equity Awards) for which the grant date is not at least six (6) months prior to the date of the Early Retirement shall be forfeited in their entirety upon the Early Retirement. |
| iii. | In the event of (i) termination of employment by the Company without cause, (ii) termination by Executive with Good Reason, or (iii) termination by Executive without Good Reason if any of (i), (ii) or (iii) constitutes a Qualified Retirement, any then outstanding equity awards granted pursuant to Section 4.2 (Annual Equity Awards) (excluding any equity awards for which the grant date is at least six (6) months prior to the date of the Qualified Retirement) will be subject to full continued vesting with delivery according to the original vesting schedule of the award (without acceleration) (PSUs will be based on actual performance). For the avoidance of doubt, any equity awards granted pursuant to Section 4.2 (Annual Equity Awards) for which the grant date is not at least six (6) months prior to the date of the Qualified Retirement shall be forfeited in their entirety upon the Qualified Retirement.” |
| 16. | Section 9.9 of the Agreement is hereby amended by adding the following: |
| 17. | 9.9.4A “Early Retirement” shall mean the termination of employment by the Executive with or without Good Reason or Termination by the Company without Cause, if, in all of these terminations, as of the date of termination of employment, he has attained sixty (60) years of age and five (5) full years of service with the Company. |
| 18. | 9.9.9A “Qualified Retirement” shall mean the termination of employment by the Executive with or without Good Reason or Termination by the Company without Cause, if, in all these terminations, as of the date of termination of employment, he has attained sixty (65) years of age and ten (10) full years of service with the Company. |
| 19. | In Section 9.9.8, the definition of “Merger Amount” is hereby amended to read as follows: |
“Merger Amount” means an amount equal to the total of (i) the Annual Salary in effect immediately prior to the Date of Termination (without taking into account any reduction in Annual Salary that gives rise to, or could have given rise to, a claim for Good Reason), and (ii) the Target Bonus calculated based on such Annual Salary.”
| 20. | In Section 9.9.11, the definition of “Severance Payment” is hereby amended to read as follows: |
“Severance Payment” means an amount equal to: one and a half (1.5) times the sum of (i) the Annual Salary in effect immediately prior to the Date of Termination (without taking into account any reduction in Annual Salary that gives rise to, or could have given rise to, a claim for Good Reason), and (ii) the Target Bonus calculated based on such Annual Salary; to be paid as follows: (x) those components of the Severance Payment required by Law shall be paid in accordance with the requirements of applicable Law; (y) an amount equal to the Annual Salary to be paid in twelve (12) equal monthly installments (without taking into account any reduction in Annual Salary that gives rise to, or could have given rise to, a claim for Good Reason), first installment to be paid seven days after the Date of Termination; and (z) the remainder amount to be paid in one lump sum payment on the thirtieth (30th) day after the Date of Termination. Such Severance Payment will be subject to continued compliance with the restrictive covenants under Sections 11, 12, 13 and 14, which includes the non-compete obligation. Under these scenarios, no additional non-compete payment will be provided.”
| 21. | Section 12 is hereby amended by deleting the words “For the avoidance of doubt, this Section 12 shall apply to Executive following a termination of employment that occurs on the expiration of the Fixed Term or any Extension Period.” |
| 22. | Section 13 is hereby amended by deleting the words “For the avoidance of doubt, this Section 13 shall apply to Executive following a termination of employment that occurs on the expiration of the Fixed Term or any Extension Period,” |
| 23. | Section 15 is hereby amended as follows: |
| 23.1 | The first paragraph of section 15 is hereby replaced in its entirely to read as follows: |
“The Severance Payment or the Non-Compete Payment is in consideration for Executive’s undertaking set forth in Sections 11, 12, 13 and 14 and subject to compliance therewith. The term “Non-Compete Payment” shall mean an amount equal to twelve (12) times the Monthly Salary (without taking into account any reduction in Monthly Salary that gives rise to, or could have given rise to, a claim for Good Reason), to be paid in twelve (12) equal monthly installments commencing seven days after the Date of Termination. The Non-Compete Payment shall not be subject to offset by any income Executive derives from noncompetitive employment or self-employment.”
| 23.2 | The second paragraph of section 15 is hereby amended by adding the words “or the Severance Payment” after the first appearance of the words “the Non- Compete Payment”. |
| 24. | Section 18 is hereby amended to delete any reference of the word “car”. |
| 25. | This Amendment shall come into effect following receipt of all required approvals under applicable law, including approval of this amendment by Teva’s shareholders. |
| 26. | Ratification and Confirmation. Except as specifically amended by this Amendment, the Agreement is hereby ratified and confirmed in all respects and remains valid and in full force and effect. Whenever the Agreement is referred to in this Amendment or in any other agreement, document or instrument, such reference shall be deemed to be to the Agreement, as amended by this Amendment, whether or not specific reference is made to this Amendment. |
| 27. | Controlling Document. In case of conflict between the terms and conditions of this Amendment and the Agreement, the terms and conditions of this Amendment shall prevail. |
| 28. | Entire Agreement. The Agreement and this Amendment constitute the entire understanding and agreement of the parties hereto regarding the employment of the Executive and supersede all prior negotiations, discussions, correspondence, communications, understandings and agreements between the parties relating to the subject matter hereof. |
| 29. | Governing Law. This Amendment shall be governed by and construed and enforced in accordance with the laws of Israel without giving effect to the choice of law or conflict of laws provisions thereof. |
| 30. | Counterparts. This Amendment may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument. The execution of this Amendment may be by actual signature or by signature delivered. |
IN WITNESS WHEREOF, the parties have executed this Amendment in one or more counterparts as of the Effective Amendment Date.
| TEVA PHARMACEUTICAL INDUSTRIES LTD. | ||
| By: | /s/ Sol J.Barer | |
| Name: | Sol J. Barer | |
| Title: | Chairman of the Board | |
| EXECUTIVE | ||
| By: | /s/ Richard Francis | |
| Name: | Richard Francis | |
| Title: | President and CEO | |
Exhibit 31.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT
I, Richard D. Francis, certify that:
| 1. | I have reviewed this quarterly report on Form 10-Q of Teva Pharmaceutical Industries Limited; |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report; |
| 4. | The company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have: |
| a. | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| b. | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| c. | evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| d. | disclosed in this report any change in the company’s internal control over financial reporting that occurred during the company’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and |
| 5. | The company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions): |
| a. | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and |
| b. | any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting. |
Date: July 30, 2025
| /s/ Richard D. Francis |
| Richard D. Francis |
| President and Chief Executive Officer |
Exhibit 31.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT
I, Eli Kalif, certify that:
| 1. | I have reviewed this quarterly report on Form 10-Q of Teva Pharmaceutical Industries Limited; |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report; |
| 4. | The company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have: |
| a. | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| b. | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| c. | evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| d. | disclosed in this report any change in the company’s internal control over financial reporting that occurred during the company’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and |
| 5. | The company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions): |
| a. | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and |
| b. | any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting. |
Date: July 30, 2025
| /s/ Eli Kalif |
| Eli Kalif |
| Executive Vice President, Chief Financial Officer |
Exhibit 32
CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Teva Pharmaceutical Industries Limited (the “Company”) on Form 10-Q for the period ended June 30, 2025 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), we, Richard D. Francis, President and Chief Executive Officer of the Company, and Eli Kalif, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:
| (1) | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
| (2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Dated: July 30, 2025
| /s/ Richard D. Francis |
| Richard D. Francis |
| President and Chief Executive Officer |
| /s/ Eli Kalif |
| Eli Kalif |
| Executive Vice President, Chief Financial Officer |