Teva boosted by European drug recommendations

Erez Vigodman
Erez Vigodman

Teva's share jumped 4% in Tel Aviv, after climbing 4.9% on Wall Street.

Teva Pharmaceutical Industries Ltd. (NYSE: TEVA; TASE: TEVA) share price rose 4% on the Tel Aviv Stock Exchange (TASE), after going up 4.9% on the New York Stock Exchange (NYSE) during Rosh Hashanah, when there was no trading on the TASE. Managed by president and CEO Erez Vigodman, Teva is traded on the NYSE at a $45.7 billion market cap, following a 36% rise in the share since the beginning of the year.

Several events involving Teva have occurred in Europe in recent days. The first is the positive recommendation given by the Committee for Medical Products for Human Use (CHMP) for approval of drugs manufactured by Teva. The second involves layoffs and the closure of the company's plant in Monaco.

CHMP announced on Friday that it was recommending approval for a number of drugs, including Balugrastim (also known as Egranli) for patients undergoing chemotherapy and suffering from a drop in the number of white blood cells as a result, which is liable to expose them to infections. Teva's drug is a biological drug. A year ago, the company withdrew its request for approval of the drug in the US, following some uncertainty about its safety in clinical trials. Analysts believed then that approval in the US would be delayed by at least two years. Another drug recommended by CHMP is for treatment of asthma.

Mediocre performance in women's health

Four years ago, Teva acquired Theramex, a European company dealing in women's health, for $366 million. According to French media reports, Theramex's employees have been notified that the plant will be closed down in 2016, and 19 employees will be laid off immediately. The employees protested and demonstrated near the plant. Teva announced a cutback plan a year ago.

Teva entered the women's health field following its acquisition of Barr Pharmaceuticals in 2008. At the time, the company spoke about annual sales of over $1 billion in the sector in 2015. The acquisition of Theramex was designed to strengthen Teva in this sector, but despite the great expectations, Teva's revenue in the sector amounted to $252 million in the first half of 2014, less than 3% of its total revenue.

At the same time, Rexahn announced at the end of last week that the oncological drug it was developing had obtained orphan drug status from the US Food and Drug Administration (FDA), and its share leaped 10% in response. Teva previously had a licensing agreement for the drug, but canceled this agreement a year ago. Teva also invested $8 million in the company for a 6% stake, but its holding has since fallen below 5%.

Published by Globes [online], Israel business news - - on September 28, 2014

© Copyright of Globes Publisher Itonut (1983) Ltd. 2014

Erez Vigodman
Erez Vigodman
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