Teva at Goldman Sachs Conference: Strategic Shift to Biopharma

On Tuesday, 10 June 2025, Teva Pharmaceutical Industries Ltd (NYSE:TEVA) presented its strategic roadmap at the Goldman Sachs 29th Annual European Financials Conference. CEO Richard France outlined the company’s transition from a generics-focused model to a biopharmaceutical enterprise, emphasizing growth in innovative products while maintaining its generics segment. While the company is optimistic about future revenue, it faces challenges such as potential pharma tariffs and the loss of generic Revlimid.

Key Takeaways

• Teva is shifting focus from generics to biopharmaceuticals, aiming to add $1 billion in innovative revenue by 2027.
• The company plans a $700 million cost reduction in G&A and manufacturing to support this transition.
• AUSTEDO sales are projected to exceed $3 billion by 2030, driven by unmet needs in tardive dyskinesia.
• Teva is mitigating the impact of potential and existing pharma tariffs without altering its financial forecast.
• Licensing deals are prioritized over acquisitions for new branded pipeline assets.

Financial Results

• Teva’s innovative portfolio has already generated $1 billion, with plans to double this by 2027.
• The generics segment is expected to remain flat until 2027, offset by a robust pipeline of new generics and biosimilars.
• Projected peak sales for long-acting olanzapine are between $1.5 billion and $2 billion.

Operational Updates

• Teva has entered the "acceleration phase" of its growth strategy, focusing on innovative products like AUSTEDO, YUCEDY, and AJOVY.
• The company is advancing its late-stage pipeline, including a dual-action rescue inhaler and duvekitic.
• Recruitment for Phase 3 of Dari is underway, with completion expected by year-end.

Future Outlook

• Teva is preparing for multiple scenarios regarding potential pharma tariffs.
• The company is planning the European launch of AUSTEDO and exploring additional indications for anti-IL-15.
• A potential launch for multiple system atrophy is anticipated in 2028, representing a multibillion-dollar opportunity.

Q&A Highlights

• Teva is engaging with U.S. policymakers on drug pricing policies, highlighting the cost-effectiveness of generics.
• The company is optimistic about removing the pill penalty in the IRA.
• Teva seeks de-risked, commercial-ready products for licensing to quickly enhance its portfolio.

For further insights, readers are encouraged to refer to the full conference call transcript.

Full transcript - Goldman Sachs 29th Annual European Financials Conference:

Matt Delatorre, Generics Pharma Analyst, GS: Okay. Great. Well, good morning, everyone, and thank you for joining us. My name is Matt Delatorre, and I’m the generics pharma analyst here at GS. And we’re really pleased to have Teva joining us this morning with Richard France as President and CEO.

And maybe, Richard, just to kind of get us started on kind of like the high level outlook. We’re just off your recent Strategy and Innovation Day, where you expanded upon many aspects of the company’s pivot to growth strategy and highlighted how Teva is now in the acceleration phase. Maybe walk us through kind of the key aspects of the acceleration phase and what you all are most focused on from an execution perspective over the next twelve to eighteen months.

Richard France, President and CEO, Teva: Okay. Well, firstly, Matt, thanks for having us. Appreciate it. So you’re right. We have entered the phase of our pivot to growth, which is the acceleration phase.

After successfully completing the phase, which is return to growth after several years of decline. And so we Q1 was our quarter of consecutive growth. And the acceleration phase is really a continuation of the strategy but a doubling down on it. Let me explain that. So in the two years, we the strategy is to move Teva from a pure play generics to a biopharma company.

Now obviously, two years ago, that seemed like an idea as opposed to something that could happen. But now in the last two years, we’ve put $1,000,000,000 of revenue on our innovative portfolio, and we aim to put over $1,000,000,000 by 2027. And so I think the acceleration phase is all about accelerating our ability to commercialize our innovative products, AUSTEDO, YUCEDY and AJOVY. And then to bring our pipeline through our late stage pipeline, which is olanzapine long acting treatment for schizophrenia, our dual action rescue inhaler for asthma, and then we have emersolment, and then we obviously have duvekitic in UC and CD. So the acceleration phase is just adding more and more products to our innovative portfolio, and I think we’ve shown we can commercialize those really well.

And it is worth noting that we don’t have any LOEs of any significance on the horizon. So you’re adding launches, I think, on top of launches in areas where there’s significant unmet need. The so that’s what the acceleration phase is. And then the generics part of the business is about creating what we’ve done in the last two years stability, because that’s a big business still and it throws up a lot of cash. And that allows us to, one, continue to improve our balance sheet, but also to invest in this innovative portfolio.

So it’s reminding that DuvaKey2, again and Eric at the Strategy and Innovation Day, Eric Hughes, Head of R and D, highlighted anti IL-fifteen. At least two products, one could argue, theoretically have the ability to go into eight to 10 indications. So we need to be able to fund those and maximize those, and that’s why the generics plays an important part in that as well.

Matt Delatorre, Generics Pharma Analyst, GS: Great. And maybe kind of stepping back, if we look at the business from the different segments today, is it fair to say the outlook is strong growth for branded and generics flat? Or are you guys still trying to grow generics to some degree?

Richard France, President and CEO, Teva: Yes. I think the headlines, I would say, for everybody to take it as that, strong growth, very strong growth for Inivative and flat for generics. Now that said, I don’t want to say we don’t have the ambition or the capability to do more, but the way we financially plan our capital allocation is that has the potential to be flat. Now for the next few years, it will be flat because obviously we lose generic Revlimid next year, which we’ve well communicated. But we will get back to the same level, so we’ll compensate for that by the end of twenty twenty seven.

And the way we do that is we have the one thing that you need in a generic business we have at Teva is a deep pipeline, both in standard generics, complex generics and biosimilars. And those will all keep coming through, and we have really good coverage. So I think we have the ability to continue to make that business perform, but we financially plan from a stability point of view just because I think that allows us to be more prudent when it comes to capital allocation decisions and financially plan. The last two years, I think people had a lot of skepticism of our generics business, and we grew it across all three regions both years and grew it very well. But what we forecast for the next up until 2027 is flat because obviously we have to compensate for generic Revlimid.

But back to your high level sort of summary is correct. This is about the branded business going to grow based on the growth rates of the products we already have in the market as well as the products we’re going to add to them, which have significant unmet need, which we believe we have the ability to make those successful. And that’s way I think to think about it from a sort of opportunity point of view.

Matt Delatorre, Generics Pharma Analyst, GS: Great. The margin trajectory has also been an important focus for both Teva and investors. And you all have announced significant cost reduction efforts. If we take a longer term perspective, obviously, this margin expansion will just happen as naturally as you shift to more branded. But maybe speak to us about kind of the key challenges or the things that you have to balance in the near term to to reach these twenty twenty seven margin targets?

Yeah. I’d it’s one

Richard France, President and CEO, Teva: thing that we’ve obviously, there’s a lot of interest around. And, you know, I I like the twenty twenty seven targets in that they mean that we have to be ruthless about capital allocation. And back to that initial question, we could talk about we could grow the generics business, we could grow the branded. We’ve made a really specific choice to really maximize the opportunities in our branded business because it’s so exciting. To do that, we need to make sure we fund it.

We fund it from a commercialization point of view as well from a pipeline point of view. To do that, we need to be very focused on cost, cost and OpEx being capital, where do we place that capital, where do we take it away from. And I think the last two years, we’ve shown we’re good at that. And we’ve highlighted this 700,000,000 program, which is about reducing expenditure in G and A and manufacturing and to increase it into, our innovative business while at the same time allowing us to compensate fully for the profit that we’re going lose from generic Revlimid. So I think as we go forward, it will still be that ruthless capital allocation, making sure we keep allocating capital to the things that get the best return on capital, which is going to be innovative.

And what I like about Teva is and what we don’t want to lose is there is a generic mindset when it comes to cost. So cost, when you spend money, it’s you’ve got to get a return on it. And so what I want us to as we move to a biopharma company, we still keep the mindset of every dollar is really important. How we allocate it is really important. And how we allocate that capital should get a good return.

And I think you’ll see that over time. But remember, as we transition our portfolio, we change our profitability profile significantly, both on operating margin and on gross margin, and that allows us, as we keep growing our top line, to allocate more capital to the things that are going to keep driving OP margin and gross margin. So I think we’ve got a really good future ahead of us, if we keep executing, which we will.

Matt Delatorre, Generics Pharma Analyst, GS: Great. And then maybe before we shift over to kind of some macro policy, topics, is there anything we should keep in mind heading into the second quarter?

Richard France, President and CEO, Teva: I think, obviously, we started quarter one, we had a good quarter once again showing a bit of this strategy playing out. Innovative, performing very strongly. The generics, I think I reminded everybody that Q1 was going to be a high watermark, the 3% growth. And I reminded people we had a lot of launches last year. Just an example, Bigtoes was launched in Q2 last year.

We also have things going on, I can call it macro because it’s more U. S. Around maybe the reduction in pharmacies with Walgreens. So those things will happen. So I think from a generics point of view, remember that the 3% is a high watermark.

We’re generally back ended on our generics business anyway. But that’s probably the thing to keep in cap. We’ve got comparison years, we had a lot of launches last year. We did really well. So keep that in mind.

But probably can’t go into any more detail than that based on the fact that we’re just a few weeks away from Q2 Great.

Matt Delatorre, Generics Pharma Analyst, GS: So maybe just switching to kind of some macro and policy topics for a I realize it’s very difficult to handicap still at this point, but what is your latest thinking on the likelihood, timing, and scope of potential pharma tariffs?

Richard France, President and CEO, Teva: Oh my god. So what I think that maybe the way we think about it at Teva is we plan for multiple scenarios. So we continuously plan really well. And so we’ve already planned, and I think we’ve taken into account. And in Q1, I think Eliot Cleef, the CFO, highlighted that the tariffs which are put in place then, we’ve mitigated and we’re not changing our forecast for the year.

We’ve worked through every single sort of potential outcome whether they get to what are termed the car tariffs or higher. And I think we have an ability to manage our business well within those scenarios. But we’ll have to see. We’ve taken action. We have things that we can pull.

But obviously, we want to see how it actually plays out. And it’s super dynamic. I mean, it’s on a macro level, global level. Things are put in place and they’re taken away. There’s good discussions and there’s bad discussions.

So I think for us it’s about do we have the plans in place regardless of how it plays out that we can protect our long term growth trajectory on the top and bottom line. And I think that’s I feel we’re well covered on that with the caveat, I don’t know where the you know, where it’s actually gonna land.

Matt Delatorre, Generics Pharma Analyst, GS: Mhmm. Could you comment on, you know, whether or not you’ve had or or or having any, interactions with the administration or or congress on kind of, you know, maybe the treatment of, say, generics versus branded or or just kind of more broadly the potential for these things?

Richard France, President and CEO, Teva: Yes. We do both. So we engage in the branded business because we all want to educate on that side. But we definitely educate on the generic side, both with the associations as well as individually. I think people forget that Teva, I remind people, one in 14 scripts in The United States is a Teva script.

So we are a massive part of the health care system. And the generics business is, I would say, a very cost effective part of the health care system in The United States. It’s very efficient. And so you don’t really want to alter that ecosystem because I think payers, Medicaid, Medicare in The U. Do very well out of the generics from allowing good access and good value for money.

So we educate them on that. We also educate them on the pressure on cost of goods and manufacturing and that is a very different discussion than on branded and where that should be. That said, we point out we have, I think it’s nine manufacturing sites in The U. S. And so we’re the largest, manufacturer of generic medicines in The U.

S. So we’re very committed on that. And also then on the branded side, Astero is made in Florida, made in the state. So I think we just keep educating on what are you trying to do. You’re trying to improve the ability to maintain the health care system.

So generics is going to help you do that, but this is how you need to think about generics. And the branded, this is how you think about branded. So we are very actively involved in that. But we’ll see how that plays out. I think one of the things I would say is the administration, at least the ones we’re talking to on February, is they’re seeking to understand.

They really are seeking to understand. So that’s encouraging because the more they understand, I’d like to think they’ll come to a rational conclusion, one would hope. But the most important thing is they’re having that discussion, and we’re having it with them individually and with the associations.

Matt Delatorre, Generics Pharma Analyst, GS: Great. Great. Maybe just lastly on the kind of policy side. President Trump’s recent MFN executive order has been an overhang for the sector. What are your latest thoughts on the prospects for such a drug pricing policy?

And given Teva’s current branded portfolio, is it is it fair to say you all are fairly, insulated from this for the most part?

Richard France, President and CEO, Teva: Yeah. I mean, look. Was another one. We have to see how it play out because it’s sort of, yeah, there’s a there’s a lot of, rhetoric around it, and and you understand where where could it actually fall. But but you’re right.

Because of where we are as this emerging innovative biopharma company, we haven’t launched our products internationally. You know, Tony Shapes, so we were doing over the and so that gives us the optionality. One, we’re not whatever happens, it doesn’t impact us immediately. And then we can strategically plan where we’re gonna launch and what price we’re going to launch. So I think in a way, we’re in a good position because with this emerging biopharma company that doesn’t have to deal with this big geographical footprint yet, that’s our plan.

Our plan is obviously to launch Astero in Europe, olanzapine in Europe and do the keto, we’re going promote that in Europe, and mesolamun globally. So we have all those plans, but we can now think about strategically how we do that and what that looks like depending on where we end up. But I was even reading some comments yesterday that some of the pure play biopharma people are maybe less concerned about that now. We Teva our default is we’re concerned about everything, and we then develop contingency plans. And then if things don’t need to be used, then we’re okay.

But we never try and look for a macroeconomic situation to benefit us because we can’t control it.

Matt Delatorre, Generics Pharma Analyst, GS: Makes sense. Maybe trying to shift into the portfolio and pipeline or the branded portfolio and pipeline. We’ve seen great growth for AUSTEDO in recent quarters and years now. And you all gave long term guidance of more than $3,000,000,000 at your recent Strategy Day. Maybe I know you’ve talked about this in the past, but kind of just briefly, what are the dynamics you’re seeing in that market that give you the confidence that, that trajectory can continue?

Richard France, President and CEO, Teva: Yes. Firstly, I’d like to sort of commend the team in The U. S. For driving the growth of Astero. That was I remind people when we started this strategy, I think, everybody forecasted peak sales of 1,400,000,000.0 We gave guidance of $2,000,000,000 roughly this year.

So we’ve shown that, if anybody doubted our ability to drive an innovative product commercially, we can do that. Now when it comes to the opportunity, unfortunately it comes down to the huge untreated population. So there’s nearly eight hundred thousand people that suffer from tardive dyskinesia, and still the majority, vast majority, I think only ten percent are on treatment, maybe slightly more. So there’s a huge unmet medical need. So the way we think about it, if we can keep driving those patients into the physician’s office, get them diagnosed, get them onto treatment, then the market and the product the market has the potential to grow.

And obviously, Asneto being doing very well in the market will benefit from that. So for us, greater than $3,000,000,000 in 2030 is based on sort of the maths. If more patients get treated, and we pick up a fair share of that, then that should be achievable.

Matt Delatorre, Generics Pharma Analyst, GS: Great. CMS negotiations for 2027 are ongoing. Is there anything you can share in terms of how those negotiations are progressing? And then what is kind of your base case relative to, like, the the wave that was around a 20% net price hit on on average?

Richard France, President and CEO, Teva: So I can’t comment because, literally, we are in the in the thick of it. So and and what I would say is, you know, when we launched the Fitbit to Growth, we put a number in, I think, most people were thinking about doing things like that. And once that goes back to our philosophy is if we’re not sure, we plan for something to happen rather than hope it doesn’t because hope is not a strategy. And so, we’re in the thick of it. What I would say is the number we put in is wrong.

Is it too conservative? Is it the other way around? I don’t know. But I remind people regardless of where that falls, there are still the majority, ninety percent of patients aren’t treated. So regardless of what happens, Astetta has a great

But I’d also say from Ateva, becoming a biopharma company, we still have Yosefi growing really well. We still have AJOVY. We’ll have olanzapine. We’ll have diarrhea, dual action rescue inhaler, and then we’ll have duvekitog. So all our chips aren’t on Astero, although I think Astero has great potential.

But I always remind people that AUSTEDO, regardless of CMS, will be able to grow just because of those untreated. But we have a whole portfolio of innovative drugs which are coming to the market. And that’s the thing that’s exciting. Talk about you said, well, maybe talk about that, how well that’s growing. I talk about how the fact that Jovi’s growing and growing over 20%.

I talk about Esteban, then you add a land that’s been down. You think, well, okay. If you’re modeling it, you can model this one maybe has a steeper growth trajectory than this, but they’re all growing. Right. And that’s the exciting thing.

Matt Delatorre, Generics Pharma Analyst, GS: Maybe just lastly on AUSTEDO. There has been talk, I think it was one in one of Trump’s, recent executive orders about maybe getting rid of the pill penalty. Is that, I mean, clearly, it’s not something you’re going to bank on, but is that something you all consider? And do you have any thoughts on the likelihood of the pill penalty being removed?

Richard France, President and CEO, Teva: Well, all I can say is I think it should. I mean, probably not best to get me started on the IRA anyway because, there’s lots to do there. If we can have another go at it, can improve. But, yeah, the pill penalty made no sense. You know?

I mean, ultimately, we’re supposed to bring, drugs to the market which fill an unmet medical need and help help society. Whether that’s a pill, a biologic, or whatever doesn’t really matter. That shouldn’t be the focus and why it was I never fully understood. So I hope they’re successful. The fact that they’ve actually started that discussion so early on is encouraging.

But once again, it’s about seeing what happens and what gets executed and what gets changed, I think. But, if that could be, that be really positive, for the industry as a whole and for patients.

Matt Delatorre, Generics Pharma Analyst, GS: And then maybe shifting to long acting, olanzapine. You all recently gave, long term or I guess peak sales guidance for both EUCITY and olanzapine, of 1,500,000,000.0 to 2,000,000,000 I guess kind of the like, immediate question is, you know, why can’t it be bigger? Why can’t it be as big as a competitor’s franchise, which I think was around $4,000,000,000 in ’twenty four? But that’s the question.

Richard France, President and CEO, Teva: Okay. I feel like I’m in budget discussion. Firstly, I welcome the question because isn’t it great we’re having a question about Teva, about can you do more with your innovative launch than you’ve got? I mean that’s just I welcome that discussion even if we may not get the The way we think about it is firstly, there’s a certain some of the things that have to happen, I think, for that to play out. Now Yoseedi, I think, has been a surprise to everybody that we’ve gone to a congested risperidone long acting market.

And I remind everybody that risperidone is genericide long acting. We’ve launched a long acting generic a while ago. So it has long acting generics. It has long acting brands. And you said it has surprised everybody.

And the reason why it surprised everybody is, one, it’s a great product. It fills an unmet medical need, whether it’s subcutaneous, non refrigerated, pre filter ins or most importantly, the fact that you get to therapeutic levels within. Now that has really got traction and we’ve got a great commercial team who have executed it really, really well. So one would argue that obviously then we launched olanzapine, which sort of is a running start so we should be able to do even better. The thing that I think maybe is the difference in the modeling is how does the long acting market grow both in The U.

S. And international. And it has been a market which has in The U. S. I think it’s thirteen percent of the whole schizophrenia market and it should be a lot bigger.

And so I’m trying to understand why. Now maybe those are because there hasn’t been a subcutaneous available. There hasn’t been something that’s patient friendly. There hasn’t been something that’s had therapeutic levels so quickly. So maybe there is an opportunity to expand that.

But I think for us, the way we talk to investors, we see if we think we have the ability to do this across these products and that’s how we sort of model and how we think about how we build our P and L going out, how we think about capital allocation. Now if things end up being better than that’s great, but what we’re trying to do is say this is the realms of what we think about. As we execute and we think there’s a bigger opportunity, we’ll obviously communicate it. We’re definitely not conservative. I think when I was on stages like this a year ago, people had very different numbers.

Now based on the success of Yoseedi and things, I think it could be more. But there’s a lot still to happen. And don’t forget, in The U. S, these are part of an area that’s getting significantly more managed than ever in CMS. And so that’s something the payer access is harder and knowing what that’s going to look like in eighteen months is so we’re always very measured on that.

We’re not assuming everything’s going in our favor. So that’s probably where we get to slightly different numbers, but we’ll definitely try and make the number as big as possible. Right.

Matt Delatorre, Generics Pharma Analyst, GS: And then maybe just kind of lastly, this technology that you’ve used for both EUSETI and olanzapine, is there potential to use that in other molecules? Or is is it kind of this is where it’s going to stop?

Richard France, President and CEO, Teva: Well, think it sort of goes back to an area of expertise which Eric talks a lot about, which is we’re very good on drug delivery, whether that’s been devices or that’s long acting. Because obviously one of the things being a generic company, we have to do them all. So we understand how the different modalities work and how you move into different areas of long acting because we’ve done them all over the last thirty years. So we have a good capability. So we’re always looking at, and obviously MedTech is a technology we use for Yoseedi and olanzapine, And we look at that across other areas.

But there’s many other long acting, technologies that we’re constantly looking at. But it’s about finding the product that needs that. It’s not about moving something just along acting. It’s does it give the physician flexibility as well to adjust those? So not everything can go long acting.

But definitely, and I think that sort of also we didn’t speak about it, but one of the things I like about the pipeline we have is, and this is something which sometimes is a bit controversial, is I think it’s a very de risked pipeline. Because olanzapine, the technology that we’re using there is the same as Giuseppe. We’ve seen the efficacy and the safety data so we know that works. The dual action rescue inhaler, could argue that’s not super sexy but huge unmet medical need. We know those products work.

We’ve been manufacturing devices for thirty years. So the POS is super high. One could argue Dubikitu based on the phase two results. Probably success of phase three I would argue is high based on phase twos are very predictive and phase threes in these diseases. So once again I’d encourage people to look at a pipeline and go, it’s a good pipeline but it’s good because a lot of it has a high POS.

And then maybe emersolomon which is the treatment for multiple system atrophy, is probably not a high POS. I’ll admit to that. But a huge amount of medical. And I didn’t mention that, but if that comes to the market then we have a phase II that is designed to be powered enough to make it registrational if it did show the efficacy. And that could come in ’28.

And as I highlighted two weeks ago, it’s a multibillion dollar opportunity in rare disease.

Matt Delatorre, Generics Pharma Analyst, GS: So maybe kind of shifting to that real quick. Obviously, that’s probably your most valuable pipeline asset at this point, and it’s received a lot of attention. And you all are, of course, developing it as a pipeline and a product. When do you think we might start to see proof of Phase II proof of concept studies in some of these other indications you guys have recently highlighted?

Richard France, President and CEO, Teva: Yes. Yes, that’s a good question. Everybody is interested in that, which I’m pleased. They are because people understand it can be used different indications. We worked through that in the last year actually with Sanofi, and so, I think we’ll be in a position in the not too distant future to communicate something.

I think we’re always a bit cautious of, wanting to highlight the opportunities, but also try and keep our gunpowder dry a bit as to what we’re doing and why we’re doing it. Because ultimately, you know, there is a slight competitive advantage. But the reason why we partnered with Sanofi was because they saw the attractiveness of a pipeline and a product, and obviously, they’ve got a lot of experience that with DUPIXENT. And so we knew they had that capability. So, we will be announcing something.

How much and how clear it will be, we’ll work through. But we definitely, for the partnership, we see this as multiple indications. No question.

Unidentified speaker: Is

Matt Delatorre, Generics Pharma Analyst, GS: there a chance that we could see phase II’s readout, ahead of the IBD phase III, or is that probably a little

Richard France, President and CEO, Teva: I mean, the good thing, this is where Eric’s probably thinking, what’s he gonna say? But the good thing about t l one a is it’s because it has such a good safety profile. So good. And as Eric reminds me, if you want to move anything to a new indication, you’ve got to have an understanding from a science point of view. What you don’t want to do is create issues because it’s so clean that allows us to move maybe a bit more in an expedited way into the Phase II which is probably what you’re touching upon.

So yes, we are thinking like that. We are thinking about can we now I don’t think we’re at the stage, but one could argue in the future where you could jump into a Phase III even, but that’s a long way down the track. Think right now having a cleverly designed phase two, which is quick, allows us to get some data quickly and then move into phase three is how we’re thinking about it. Absolutely.

Matt Delatorre, Generics Pharma Analyst, GS: And then maybe just kind of briefly, you’re obviously partnered with Sanofi here. And they have an industry leader, and that’s clearly a major advantage, in terms of launching into all these iodine indications. Could you speak to maybe how aligned you two are in terms of kind of the pace and the breadth of development for this asset?

Richard France, President and CEO, Teva: You know, I think we are very aligned. I mean, the good thing about it is because those are the two key things. You’re aligned in the breadth and the pace because that’s where, you know, like any relationship, you start with good intentions and then maybe drift apart. The reason why, as I said, I like Sanofi is one is they, have a lot of experience, so we can help them execute. They can help us execute on multiple indications.

But, and I’m I’m sure Paul doesn’t like me saying this, but they do have DUPIXENT, which at some point will end. And so that creates a sort of a line in the sand where they also need to be bringing things to the market. And so as we partnered together, I knew they had a sense of urgency because of that. And TL1A, being a pipeline of product, allows them to think, okay, if we execute on this, then we have something which can help offset that. So sometimes you have to have the pushes and pulls and the urgency sort of forced upon you.

And I think we have it because we want to drive growth and financial return. They have it because they need to start building a pipeline that offsets some of their LOEs. Yes, makes sense. And I just phone them constantly. Usually phone But there it goes.

Matt Delatorre, Generics Pharma Analyst, GS: Maybe kind of lastly on the pipeline. We’ll see Phase III data for Dari in second half, potential launch in 2027. And consensus sales for AstraZeneca’s competitive drug are about $1,200,000,000 right now. I guess the question for you guys is how big of an opportunity could this be? And what’s going be the greatest kind of just commercial challenge if we assume that this Phase III is probably pretty derisked?

Richard France, President and CEO, Teva: Yeah. And we think it is. Well, firstly, we have to recruit. We’re recruiting well. And just so you know why we’re so good in development at Teva is because we execute and our team executes really, really well because they’re looking at the data all the time.

There are no multiple phase 3s that we just look at and we’re just sort of Eric’s in the detail and so he believes we’ll have full recruitment by the end of this year. And then because it’s an event driven study, then we just have to see how that plays out. But the reason so firstly, I don’t agree with the consensus on AZ’s peak stars and that’s because there are 10,000,000 Americans who should be on this therapy. And if they’re on this, they can’t be at 1.4. And if you’re only a fraction of them on this, it’s going to be a lot bigger.

And they should be on it because it’s stopping hospitalizations and all the things which the reason why the guidelines have given that, advice. So the reason why I think we have the ability to be successful commercially is you never want to be to a market unless, and this is one of those unless. The market is created by AstraZeneca, I think they’re a world renowned respiratory company or have capability. They create the market for dual action rescue inhalers. We come in three years later, and we’ll have a pediatric indication, which is twenty five percent of the population.

And I think the way we planned it out is we obviously just go and say, We’re an indicator for pediatrics, and you can use both. We also think we have an advantage in our device. Our device is very simple, and I think that will play out into a wider population as well. But look, I think the market’s going to be bigger than people have predicted. And I think one could argue if we just get what we’re solely indicated for, we get 25% of the market, that’s a good business.

But I think that market is two players, and it’s going be driven and grown over the longer term.

Matt Delatorre, Generics Pharma Analyst, GS: Greg, maybe shifting to capital allocation, which, you all have emphasized is a very important aspect of approaching the business. You all highlighted neuro, INI and rare disease as kind of your key areas of interest given where your current capabilities lie. Maybe just kind of speak to your level of appetite for bringing in an additional branded pipeline asset over the next twelve to eighteen months?

Richard France, President and CEO, Teva: So I mean we have a high appetite for it, definitely. But at the same time, once again, we think about capital allocation, return on capital deployed. We think about our internal pipeline that’s now starting to come. We want to launch that well. So we’re lucky.

We have a lot of organic growth. But I do want to do BD because I think we can sell stuff really, really well. Like we’re really good at it. Whether if you look at AUSTEDO, YESEDI, AJOVY, very competitive markets. Some, we’ve had to bring patients into the clinic.

Others, we’ve had to compete with big companies or congested market, and we’ve shown we can do it. So I feel that I would like to give the team more opportunity. So we’re actively looking all the time, but we’re very thoughtful about it because, one, we can be because we have that organic, but we want to make sure that we are allocating capital to something that will have a good return, particularly in the short medium because what we bring in, we want to be de risked. So we’ll not be bringing anything in that carries a significant amount of risk because why would we do that? So it’s gonna be de risked and one that can add to our top and bottom line relatively quickly.

Unidentified speaker: Mhmm.

Matt Delatorre, Generics Pharma Analyst, GS: Okay. So you so in terms of stage, would prefer something, you know, maybe phase two or phase three or later?

Richard France, President and CEO, Teva: Even later. I mean, look. Obviously, you gotta you’ve to build, and so we almost look to the future a bit. But don’t forget, we have two products which are pipelined in an asset. So as I said, anti IL-fifteen and dupiketa are going to have a lot of indications, and we’ve to plan for that.

So we would still bring some stuff in earlier, but it’s always going to be in the clinic. I don’t think you’re going see us do anything preclinical. And we’d want something that is phase three or or a Commercial. Commercial. Mhmm.

Because we can put it into our machine, and we can really execute on that. Those are hard to find that fit. And we want it to be synergistic as much as we can because then we get a a force to the bottom line really quickly. So that’s what we want to do. Those are hard to find, but we’re constantly looking.

But that’s the way we think of it. Because if we find that, we know we’re not carrying risk. The risk is just on execution. If we execute well, we’ll get a good return on the capital, and I would do that. We’re looking hard, but there’s not a lot of those around.

Matt Delatorre, Generics Pharma Analyst, GS: Right, right. And then anything in terms of the deal structure? Is it would this be are you do you preference for an acquisition or the partnership, licensing deal be?

Richard France, President and CEO, Teva: Probably more licensing just because it’s often, it’s you’ll get a better, structured deal. It allows you to have milestones, allow you to think about certain things whereas and I just don’t think right now from a capital allocation M and A is something we need to consider. So I think in licensing is something which I look at as being really attractive because we get a once again, if you think about the macro environment for biotech, it’s hard to launch now. It is really hard to launch, really hard. Not just to raise capital to launch, but to launch successfully, and to get a return on that quite quickly.

So I think one thing that Teva’s now getting recognized was we can launch really well and we can commercialize really well. So if you want to think about that, we can license it in, and then we can give investors a return on their investment. And if we’re structured well, we can give them a return in the long term. So I think that’s how we’re trying to create that opportunity. And maybe the time is right, but once again, it comes back to not doing something for the sake of doing it.

Is this the right allocation of capital?

Matt Delatorre, Generics Pharma Analyst, GS: Great. Well, with that, I think we’re all out of time. So Richard, thank you very much for being with us. Really appreciate your time.

Richard France, President and CEO, Teva: We appreciate it, Matt. Thanks very much. Thank you.

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