"The takeoff runways at pharmaceuticals companies are long, and the landing runways are also long, so perspective is important. The start of 2014 gave no indication of how it would continue or of its successful close," Teva Pharmaceutical Industries Ltd. (NYSE: TEVA; TASE: TEVA) CFP Eyal Desheh said today at the Oppenheimer Annual Israeli Conference.
"There was a change of managers, and there were question marks over the business model. First of all, it was necessary to stabilize the basis of our business model: organizational efficiency, presence in the markets, aggression in sales both on the generic side and on the unique side. The results are impressive. This has manifested itself in the share price, which rose from $36 in October 2013, and is now in a quite different place.
"We continued with greater determination to consolidate the business infrastructure on which Teva stands," Desheh continued, "This was an enterprise-wide effort. We see the results in a business structure that is more efficient, stronger, and with results that beat the forecasts.
"The work that was done on Copaxone will yet be learned as a case study, how the company has succeeded in life cycle management, transferring patients to the new version and at the same time protecting its intellectual property. Copaxone, which many prophesied would decline substantially, is still a strong product, and will be so in the coming years."
On the subject of Teva's expansion through acquisitions, Desheh said, "We made two acquisitions in the past few months. One was of Labrys, which is developing innovative solutions for migraine, a biological product, with very impressive results in its Phase IIb trial. The second company the acquisition of which was closed, something that got a little lost in the noise being made by Mylan, is Auspex, which is developing products for treating body movement problems. Together, these two companies have sales potential greater than Copaxone. When we talk about the efforts Teva is making this is the model of drug companies.
"A product doesn't live forever; you build alternatives for it. And Copaxone is still a product with a long and interesting life ahead of it. We are improving the portfolio, building a pipeline, launching new products, all this continues to generate results and an infrastructure for Teva's future growth in the world of unique drugs. In 2017, our portfolio will traverse the patents cliff, and continue to grow."
As for the proposed deal to buy Mylan, Desheh said, "Teva is a very focused company. It continually improves. We are focused on that even while we deal with the next matter (buying Mylan). Huge quantities of words have poured forth in the international and Israeli press and media. I shan't say anything new on the subject. Teva told Mylan that it was interested in buying it. It was done in a correct, orderly and respectful way, and received the response you have all seen. This response received a respectful and orderly response from us that talked about substance. We believe that the deal will create consolidation in the generics industry, that it's the right deal, for Teva, Mylan and the shareholders. It's that rare kind of deal that can generate value for the shareholders of both companies.
"For anyone who doesn't remember, we work for our shareholders, and not the other way around. Creating value for the shareholders is one of the main goals. There are other goals: the workers are important, as are the customers, but the people who pay our salaries are the shareholders. Analysts who have looked and analyzed, people who cover the industry, say that this is a deal that can generate significant value, at a low level of risk."
Published by Globes [online], Israel business news - www.globes-online.com - on May 10, 2015
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