TEVA Pharmaceutical Industries expects to have an opioid agreement in the United States by the end of the year and to start paying in 2023, the chief executive said yesterday, while questioning the company’s very low share price.
In July, after years of negotiations, Israel-based company Teva proposed a nationwide settlement of $4.3 billion – mostly cash and some medicines – that would stretch to between $300 million and $400 million over 13 years US dollars (400 million euros) to resolve his opioid lawsuits.
US states, cities and counties have filed more than 3,000 lawsuits against opioid manufacturers, distributors and pharmacies, accusing them of downplaying the risk of addiction and failing to prevent pills from being diverted for illegal use.
CEO Kare Schultz said the company is working on legal wording, which should be complete by the end of September. It must then be approved by the US states and subdivisions within the states.
“If they decide to do that once that’s all done … then it goes into effect and that means the first payments will come next year and continue for 13 years,” Mr Schultz said. “So by the end of the year you should have that clarification that it’s all coming together and we’re going to start paying next year.”
Teva has denied wrongdoing and said it sold legal drugs approved to treat pain.
The US opioid crisis has caused more than 500,000 overdose deaths over the past two decades, according to the government, with more than 80,000 in 2021 alone.
Mr Schultz said Teva will continue to cut costs by closing some of its locations. Since 2017, it has reduced the number of production facilities from 80 to 53 and plans to close another 10 in the coming years.
New York-listed Teva shares are up 10 percent so far in 2022 to $8.81. They reached $72 in 2015.
Mr. Schultz noted that Teva has a price-to-earnings ratio of about 3.5, while a normal price should be 10.
“Teva has one of the lowest price-to-earnings multiples of any stock I know of, and the business is actually very stable that will grow and generate cash over the long term — so it’s very good for long-term investors,” he said.
“Right now we’re worth a third of what you would see as normal if we didn’t have those risk factors.”
He suggested that the low stock price was largely due to the high level of debt, which fell from $34 billion (€33.95 billion) to $20 billion (€19.97 billion), and the opioid -Litigation.
Teva is a global manufacturer and distributor of generic pharmaceuticals with customers in over 100 countries.
The company employs 800 people across three sites in Ireland, including a manufacturing facility in Waterford specializing in respiratory medicines, and is a key supplier to pharmacies and HSE.
As one of Ireland’s largest suppliers of generic medicines, the company says around one in eight prescription packs is from Teva.
Teva’s Irish arm 2020 earnings, which were most recently filed, rose 13 percent to €314 million.
The company announced last year that it was closing its Sudocrem factory in Dublin with the loss of 110 jobs. Production stopped this year and is scheduled to move fully to a new facility in Bulgaria by January.
https://www.independent.ie/business/world/teva-close-to-finalising-us-opioid-deal-for-43bn-41998659.html Teva is about to close a $4.3 billion US opioid deal