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The Israeli company Teva Pharmaceutical showed a loss of $ 6 billion

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The Israeli company Teva Pharmaceutical showed a loss of $ 6 billion
August 04
09:00 2017

Investors are worried. One of the largest generics concerns in the world, the Israeli Teva Pharmaceutical, has shown a huge loss on the results of quarterly activity. The amount of losses amounted to 6 billion US dollars. The Financial Times reported this insecure fact.

Our reference: Generics are such drugs that are similar in their pharmaceutical, biological and therapeutic properties to the original ones. In fact, this medicine is similar in effect to original drugs, but does not have a patent protection. The advantage of generics is their small price as well as similar proven effectiveness. Generics are allowed to occupy their niche in the pharmaceutical market only after the expiration of the patent protection of the original medicines. For the past six months, Teva Pharmaceutical has no General Director. It is assumed that such a financial result will further complicate the search for a new leader. It became known that at least two worthy candidates had rejected the offer to occupy this important and difficult post: the current head of AstraZeneca Pascal Soriot and Jacqueline Faus, who is known for her leadership experience at Celgene.

The future leader of the Israeli giant will have a hard time: the company is in a state of crisis. Purification and cutting costs can’t be avoided. Such large-scale losses are caused by the company’s unsuccessful acquisition of production facilities for the production of generics from the American corporation Allergan Plc. The deal amounted to $ 40.5 billion.

The result was a decrease in dividends by ¾ and the staff reduction by seven thousand. Such measures can’t be called popular, so that the company’s shares collapsed on the eve by almost a quarter. The capitalization of Teva Pharmaceutical is currently estimated at $ 33.5 billion. At the same time the amount of the debt is equal to 35 billion US dollars.

As a result of yesterday’s collapse, the rating agency Moody’s transferred the credit rating of the company from Baa3 to Baa2 and negatively assessed the prospects of the Israeli pharmaceutical giant to overcome the crisis.

We hope that the company will stay on the market and continue to supply the population with inexpensive but effective medicines.

The material was prepared with the participation of Andrey Majorov,
a leading analyst of the brokerage company CT Trade

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