As previously hypothesized, Teva Pharmaceutical Industries TEVA will not undergo a split into two separate entities.
On Tuesday, Teva CEO, Riccardo Francescosaid the company will continue as a unified entity, managing the generics business and branded drugs.
However, the company will remain together and “from an infrastructure perspective, (the two companies) complement each other incredibly well,” Reuters stressed, quoting the CEO in a press conference.
Read also: Why This Teva Pharmaceutical Analyst Is Getting Bullish On The Austedo Franchise.
Teva’s generic drug business plays a crucial role in funding the company’s research and development efforts.
Collaborations with Israeli universities on research and development projects have given Teva an advantage, eliminating the need to seek external funding for innovation. This strategic approach has allowed Teva to navigate the competitive pharmaceutical landscape.
Despite facing challenges, including the loss of exclusivity for the multiple sclerosis drug Copaxone and various lawsuits, Teva remains optimistic about its future.
In January, along with fourth-quarter earnings, Teva announced plans to divest its active pharmaceutical ingredient (API) business, which offers small-molecule APIs, with about 4,300 employees.
The move allows Teva to maximize current and potential revenue streams. Teva expects the planned divestiture to be completed in the first half of 2025.
Reuters notes that the API business is valued at $1 billion in an $85 billion global market and is expected to attract significant interest as a stand-alone entity.
Francis expressed confidence that the API business can grow more than the current 6% annual rate.
In the Reuters report, Francis assured that future M&A activities will be approached thoughtfully and appropriately as the company’s debt declines.
Price Action: TEVA shares were up 0.88% at $13.14 on Tuesday, at last check.
Disclaimer: This content was partially produced with the help of artificial intelligence tools and was reviewed and published by Benzinga editors.
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