Teva tanks: No longer most valuable TASE co

Kare Schultz Photo: Shlomi Yosef

Down 13.34% on the Tel Aviv Stock Exchange today, Teva has lost 86% of its value since 2015.

Teva Pharmaceutical Industries Ltd. (NYSE: TEVA; TASE: TEVA), once considered the "share of the nation" is continuing its freefall. After losing 12.5% on the NYSE yesterday, the share price is down a further 3.5% on Wall Street today at $9.16, giving a market cap of $9.99 billion. The share price is now down 86% from its peak in 2015.

Teva lost 13.34% on the Tel Aviv Stock Exchange (TASE) today and has been overtaken as the most valuable company on Israel's stock exchange by Bank Leumi (TASE: LUMI). Since the share's peak some NIS 180 billion have evaporated from the pharmaceutical company's market cap on the TASE. It is now only the third most valuable company on the TASE. Since the end of January 2019, Teva has lost 52% of its value.

Last year Teva lost its title as Israel's most valuable company when it was overtaken by Check Point Software Technologies Ltd. (Nasdaq: CHKP), which is currently worth $17.183 billion.

It is now 18 months since Kare Schultz became Teva's CEO. His clear mission was to bring Teva back to its previous exalted position even though he had inherited from his predecessor Erez Vigodman scandals and a crippling debt of $35 billion.

He began promisingly by successfully leading an aggressive streamlining plan that including closing factories and laying off 25% of Teva's workforce. The share price rose 34%. But the smiles were soon wiped off shareholders faces and Teva is now worth what it was in 2000.

The latest plunge in Teva's share price follows the $85 million settlement agreed by the company with the state of Oklahoma regarding the damage caused by opioid addiction. Despite initially arguing that it would fight the case, Teva came to a settlement and the assumption is that this is only the first of many. In addition, Teva is facing lawsuits regarding price fixing of generics in the US and UBS estimates that all these lawsuits together could cost Teva as much as $4 billion.

On top of this Teva still has a net debt of $26.7 billion, revenue from blockbuster multiple sclerosis drug Copaxone is falling fast after the expiration of its patent, and in recent days there have been further revelations about Teva's ill fated $2.3 billion acquisition of Mexican company Rimsa.

Published by Globes, Israel business news - en.globes.co.il - on May 29, 2019

© Copyright of Globes Publisher Itonut (1983) Ltd. 2019

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Kare Schultz Photo: Shlomi Yosef
Kare Schultz Photo: Shlomi Yosef
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