Rekah Pharmaceutical Industry Ltd. (TASE: REKA) notified the Tel Aviv Stock Exchange (TASE) this morning that its fully owned unit Vitamed has signed a binding agreement with Teva Pharmaceutical Industries Ltd. (NYSE: TEVA; TASE: TEVA) to manufacture several prescription and OTC drugs and products for preventing infections in hospitals. FIMI Opportunity Funds acquired control of Rekah three and a half years ago and owns the company with Mordechai and Georgette Elgrabli.
The agreement, which is subject to regulatory approvals, is for ten years with an option to automatically extend it. Teva will continue to market the products under its brand.
No financial details were disclosed but sources in Israel's pharmaceutical industry said that the deal could be worth several tens of millions of shekels annually - a substantial amount for a company with annual revenue of about NIS 200 million.
The deal is part of Teva's streamlining plan in which the troubled pharmaceutical giant is laying off 14,000 employees worldwide.
Rekah said, "We are delighted with the important cooperation that we have achieved between Rekah and Teva and the determined efforts of Teva to keep manufacturing of its products in Israel. This is a measure of importance for the Israeli market which will strengthen the industry's activities in the country and ensure continued supply of vital products for Israel. For Rekah, this is a major step up in terms of the volume of activities, production and logistics and we see this as a vote of confidence by Teva in the company's capabilities. We hope that this collaboration that has been agreed will lay the infrastructure for other collaborations in Israel and abroad."
Rekah manufactures, imports, markets and distributes pharmaceuticals, cosmetic products, vitamins and food additives.
Published by Globes [online], Israel business news - www.globes-online.com - on August 27, 2018
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