Teva Pharmaceutical Industries Ltd. (NYSE: TEVA; TASE: TEVA) announced today its intention to divest its active-pharmaceutical ingredient (API) business in the small-molecule API industry - TAPI - which has 4,300 employees worldwide. There was already speculation last year that the company would make such a move and Teva did not disclose any figure for the value of its API activity.
In its announcement, Teva said it expects the sale to be completed by the first half of 2025, "subject to reaching a satisfactory agreement on transaction terms with a prospective purchaser, the successful satisfaction of closing conditions, and the approval of an agreed transaction by Teva’s Board of Directors."
Teva said that the sale of TAPI will allow Teva, "To maximize current and potential revenue streams, focusing on capital reallocation towards growth and innovation, and to better serve patients. The intended divestiture is expected to create additional value for Teva’s shareholders and other stakeholders by allowing Teva to better address distinct, growing markets with Teva’s leading product offerings. It will also allow the divested company to pursue new growth strategies, enabling it to maximize an array of opportunities in the $85 billion global API market."
Teva president and CEO Richard Francis said, "The divestiture of TAPI will play an important role in the execution of our Pivot to Growth strategy in this new era for Teva, as it will allow us to increase the focus on our core business, continue to invest in our growth drivers, accelerate our innovative and biosimilar pipeline, and position our generics portfolio and pipeline to drive growth for the future."
Teva also published its results for the fourth quarter and full year 2023 today. Revenue in the fourth quarter was $4.5 billion compared with the analysts' forecast of $4.01 billion. Non-GAAP net profit in the fourth quarter was $1.135 billion or earnings per share of $1. The analysts' expectations were for $0.77 earnings per share.
Teva also published 2024 guidance of $15.7-16.3 billion revenue - higher than analyst estimates and earnings per share of $2.2-2.5 - analysts' estimates were $2.42. Teva expects free cash flow of $1.7-2 billion.
Teva's fourth quarter results included a $500 million payment as part of its collaboration deal with Sanofi.
Published by Globes, Israel business news - en.globes.co.il - on January 31, 2024.
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