Teva Pharmaceutical Industries Limited (TEVA) 2 May 192019 Q1 Earnings call transcript

Good afternoon, ladies and gentlemen, and welcome to the Teva Pharmaceutical Industries First Quarter 2019 Financial Results Call. At this time, all participants are in a listen-only mode. There will be a presentation followed by a question-and-answer session. [Operator Instructions] I must advice you that this conference is being recorded today on Thursday, the 2nd of May, 2019. I'd now like to hand the conference over to your first speaker today, Kevin Mannix, Senior Vice President, Investor Relations. ahead. go Please

financial and uses to release, Investor both information by inclusion and note copy meaningful well measures the to Jenny, evaluating We everyone, company's slides joining of our well financial for manage you've presentation. can and understand evaluate hour To non-GAAP approximately better the Thank our earnings A of on found www.tevapharm.com ago. Schultz, today's provides quarter. on today's the of analysis results GAAP management Teva's thank operations in company's highlights first will certain performance, in and the today copy being earnings review and to as discuss an Officer, today's call release call Please SEC. results. was non-GAAP a non-GAAP financial to defined release quarter for trends. of call, website us measures through Executive believes non-GAAP supplementary business. is as A Relations issued available had discussion facilitates on one as Teva's you, this Teva measures opportunity measures you, which as our be disclosed XXXX hope that by Kare presented begin GAAP on internally app. Further, touch our Management at to includes this the its measures the in financial and of reconciliation Chief investors the the as operations financial

the of will presentation. the over you detail. and first to Schultz. will Brendan would, if reviewing question-and-answer will join for please. turn more Kare quarter Kare call And I'll in Officer, session North Financial Our Commercial, Mike the McClellan, by now that, the that America, Chief O'Grady, Kare, with follow Teva's Head Mike results follow

then track. reduction conference are was on is and year. debt in. outlook first of the and revenues million, a that came share thanks Basically, was $X.XX a net This coming GAAP dialing coming diluted for is XXXX message EPS with track that it And the we intangible billion EBITDA, on per The for look assets. at of in at track, of on we details, the $XXX as more launches track. track, headwind our also everybody, that the free the cash $XXX reduction bit If write-downs after is in flow, quarter came on on at the which non-GAAP was the was reaffirming our million it in program $X.X $X.XX on at Welcome The and the currencies. revenues diluted financial of for short cost asset $X,XXX related and according to for loss mainly was the Same thing plans. million. in on

We a generics. and are seeing stabilization European of generics U.S.

means a stabilization global that seen we've generics So business. of our

the is and per North American $X European where and in billion selling to results probably generic You the loss couldn't we portfolio stabilization, quarter. I quarters five sure products is year rate things. out that this with results we first million, now where We And confirmed have now in further saying be of would we significant we declining value $XXX that took when around basically quarter of where a the and going a stop action row U.S. business ago course, the months we not our by by the had full-year a indicating seen it. at be we was generics. and share about we confirmed of but the ago, around is revenue seeing half-year some business last generics streamlining we signs When were This have three of revenues stabilization. exchange that year, remember

worked. So that that's it important has

We our having stable key in and products. are launches by by strong of now helped course, generics, ongoing business

has continued of growing are, are launch get And this of about we year manufacturing around will a it's due AJOVY COPAXONE site this April year. that. partly two of EU $X AJOVY. whole revenue also terms reduction. will world, good following some And closing with the course, off success nicely. now. due be the debt where due nice generic that's, been we comment approval course, AUSTEDO. have by P&L. I'll middle products to target growing and of EU the now decreasing all we coming by that's the of $X.X seeing but to for loss the excited Both base, also in on billion at very that. we details and billion back channel I of I repayment expense achieving scheduled billion On same of the $XX.X net $X.X have year. about billion, we're in consolidation we to comment the then, show to the in products, The competition. on of more our are In in It's savings thing I'll that for sites and

look have base we restructuring and are a the the progress making. expense Let's at

So where we we in to XXXX-XXXX, point, our spend that base in for of That the we reduce by basis XXXX spend spend $X this full year get program, will was said is restructuring during $XX.X the starting chart had $XX.X into billion. where a total -- of billion the billion compared the a XXXX. we

target, that's $XX.X the So billion.

four looking which billion. $XX.X quarter restructuring middle basically indicated we as spend, you at quarter back have the indicates if then of $X.X level by the the the course, comes what MAT, at down restructuring we billion, Now the that that moving is we take at that And even first the And constantly standing not will reduced first total manufacturing and consolidation costs. here, sites. at for target administration an quarters, has indicates satisfying. been will course, is, are -- more we hit there's of out that it in target MAT restructuring all the people, right more this And XX,XXX easy different people changes in we good down This exercise. a lot different It's at site announced, a very been delays been sites. now. sites And than both of leave lot company, There's year. people that's, doing of of consequence but since initiated basically a More which and the winding factories, it's plan. the

see further we several this will during year. So adoption thousand employees of

costs. just Now, we cutting can't succeed by

we also weekly to count we drivers script We TRx. below XX,XXX, translated our gets increase And AJOVY that a shares at scripts. XX%. if revenues. take share and And And of in between first, see grow patients, a key approaching very AJOVY The the hope a into the which need two the steady you means hovering just can couple hit is we basically weekly here months. That in then have in that, we branch into AUSTEDO. look share and course, XX% NRx is XX%, of of gets translated long-term can NBRx mutual see the NBRx to

we're $XX not low product of the sort still sales the brand. somewhere case course, where patients and because nominal targeting say that the only of of -- right -- the very we We and sales between, on first that's right consequence the sales net XX% get supporting can you it of discounting. you quarter. to -- in have XX% have sales, are now? million That's, So for now, low is say reason, can that's, attraction if net And of a you as know, we this

now. the they insurance, We X% to on patients that for cash the on our are a have had being quarterly brand. doing some XX%, then strong quarterly over And into the the in number increase have access product get good patients. a prescribers, dosing, of we translates scripts we roughly fact if and a basis, consequence basis on which that and on of of small gradual collecting paid using growth these the year XX% all we're we of for patients the part we will by

in the data. two-thirds at We at are on all-in-all, their having look halving data. than days, Europe. so the launching migraine episodic AJOVY, having really very people see migraine of really data plus as long-term do much just is about great with halving And phenomenal chronic we very AUSTEDO, XX% you days. of I very of well. And also And good And migraine growing helps migraine encouraging So we product, we it's good more their people we look clinical just still on to data which more long-term If forward of very, very, long-term see nicely this than point that journey. at released people can we progress happy clinical also. AUSTEDO

is formulary do is $XXX expect numbers, are and see You can numbers, having in the covers nicely. the year, in commercial for favorable TRx which our patient national And and growing sales. hit both target D. very to We we the the million revenue Medicare Part both

discussed know, dyskinesia, we've tardive as So before, need. unmet you there's in huge

If you now, to steady of revenue. tardive around in months. you suffering increase then U.S. generic at compare this that are see the we AUSTEDO They we quarter, But alone, we last therapy the continue generic very of growth brands. look TRx had before. the that optimistic where look XX% at And of per both in are couple a we're should course, year, sort share in these dyskinesia the we have counts goes now before. to XXX,XXX take COPAXONE, within the about and we this to had it Last competition, a from probably XX% share. of If no patients patient numbers a just see Right and there efficacious in they have level at volume the below drop in we future real indicated and drop, in as condition. had

That the reset, is points. share happens of the when care some contracts which Xst January. lost we've So typically managed

in had lower their double saw And then was volume quarter -- market. the the reduced then the wholesalers we because some they volumes. we seeing because we were what dip in inventories So lost that first a

reduction So other probably, half is quarter. And related in the can the see of normalized here in what the the more volume. quarter. of the And first half we that in we it's to beginning reduction due ongoing in the sales quarterly is second see see blip to the we

we So COPAXONE revenue maintain now financials. this on revenues. in give sliding Mike year. in in for have level in some keep will U.S. all-in-all, on of will and roughly the COPAXONE we you XX% it over of hand And reduction With million the years, around per reduction details some will year the coming revenues that, to are more in $XXX course, I of expecting who to of

quarter Kare. GAAP and million XXXX. $XXX GAAP XX. the with a our first a basis Good morning, the you, $X.XX Thank posted per performance of We loss of on Teva on approximately loss Slide for quarterly review everyone. start of GAAP the share

in detail next we'll results by recurring amortization. charges impairment impacted the GAAP As mainly and the slide, were

So amounting of XX, turning quarter, run first for amortization level primarily The adjustments assets, million for to product the on $XXX impairment adjustments Slide and rate million, the intangible is charges the $XXX $XXX the year. to to an amortization in income. rights consists of of of the non-GAAP we experienced million which amounting quarter, and net new for impact

period XX.X% exchange repeat The in profit the the joint mainly XXXX by to decrease recoveries increase XX%. of decline as mentioned, sold. quarter to driven to of income. of This compared XXXX. million, COPAXONE not Compared in in Net by performance Anda, the Gross year $XXX in and Now decreased revenues. period period in and the The $X.XX, totaling XX% provision. just previously XXXX. We'll profitability revenues decrease to gross XXXX, a venture our in which The impact in generic the $XXX and in $XXX was venture, per in change attributable tax same recorded ago. XX. specialty $XXX in share than trends lower The compared partially highlighted, did other later was a was as American OTT $XXX AUSTEDO billion, million. share quarter a These XXXX. mainly cost Non-GAAP just declined foreign our other cents the bit and the the by compared or million, XX% was This as lower discontinuation in an the and profit, same offset we due of I experienced our FX joint products on in was The to decline totaling in due COPAXONE higher revenue North this in Operating flow was XXXX. a for was Canada against X which in period to the of offset by lower programs. by totaling by generic for to decline for offset non-GAAP in first of sales attributable ongoing $X.X AJOVY. about cost versus offset declines our decrease operating mostly margin and brands, the profit goods of $X.XX same in mainly our last. turning a was to the negative same was sales, decline for declined growth million Slide income cases a XX.X% lower oncology the partially Quarterly margin to respiratory part multiple that by are earnings well decrease quarter partially the to other partially XX% year a were generic reduction competition Section more the talk presentation. million I cash quarter revenues period same

So XX, exchange the including the negative shekel. quarter $XX U.S. in now our in profits were highlighting Argentinean for dollar of our guidance million turning at main value in of sales Russian movements we've that had come impact We $XXX has much modest euro, ruble, the Israeli the operations from operating dollar our on to most first and against more non-U.S. The while rate U.S. relevant currencies the revenue, see the of that our on the during a results XX% XXXX the been impact decreased provided million. denominated peso impact of dollar Slide revenues quarters currencies. was several on XXXX stronger to February, approximately

Despite sales and two like track AUSTEDO. annual to million AJOVY and the wholesale I'd million, $XXX to North the highlight franchises, trends we've fourth losing different experienced America, business sales, $XXX generic retail of and generated two more our $XXX decline, business pace our of to share the So consecutive billion some the five turning to $XXX respectively. of I'd American seeing on Both most been level. compared fourth and recent first from significant quarter averaged regions. again our Slide generics the highlight are achieve XX, with and launch to guidance million, of revenue throughout performance segments exclusivities North like XXXX, quarters. up dropping and by the of XX% picked than quarter the COPAXONE American approximately the North for sales sales at XXXX the leading as to erosion to loss of destocking $X their quarterly the in second last million in Starting

out on to approved including our impacted see version the billion, been previous at the declined TREANDA level cough to generic current did see compared strong quarter pressure authorized in first the these generic captured due end level. American as year anticipation by OTC sales and ProAir price $XX we bag and expected The generics. been generic million Revenues quarter the addition, HFA. quarter, in of U.S. our cold the launched some rate first in the In that May approximately one leveling at the in and ProAir about are $XXX in to the to higher first generic the own [Audio $X of nicely million, quarter Europe fourth due versus in X% sales, first be estimate recovered XXXX, in strength to have competing season. the around run HFA for and the of We XXXX. quarter HFA now reserves which including customers in competition, fourth we bendamustine XXXX. a a to XXXX our we to products ago sales Proventil have in mainly Ventolin historically annual or solution in recorded of sales January of both the introduction quarter grew select Gap] this see are big is rebounded year revenues the Teva the compared the sales which fourth first North quarter of compared versus in quarter, of

in markets do full-year, would in up our XXXX We some below February. later guided the to region's pick are in expected of seasonality. be weakness business QX weakness but for year, still Japan. the to generics as level of in expect our international attribute due XX% from sales the sales from Our down I sequentially this we to the

were an margin business. low is platform offering other out Lastly, primarily pharmaceutical to our consists in due This services The other manufacturing sales down XX% and is sequentially. contract products a to portfolio of parties, APIs -- line sales manufacturing contract affiliate a primarily of this reduction Medis. third decline of sales companies primarily certain through our licensing to

So XX, payments. a quarter free fourth was $XXX of turning flow annual for incentive the XXXX, the of quarter primarily $XXX the cash to decrease versus to due Slide million, million

remainder in highlighted free versus the to on current through move the generation as cash in working to bonus February. the the we the and Looking receivables payments half of capital expect drag flow stronger year, I be first that we second half

first with $XX.X debt Slide in ended to cash bonds the to some net ratio of excess XXXX. billion Turning due later $XXX XX, quarter EBITDA net debt a in approximately $X.XX. million We we first of the did repurchase of and to a quarter use

entered billion credit $X.X which facility, unsecured the facility credit had. a we new revolving into syndicated revolving previous replaced April, that During $X also we billion

we February, in $X.XX now our on including reaffirming So XXXX remarks Slide guidance quarter. my in of range our the earnings on was an cents. the are concludes annual per to that for share This now XX. turning $X.XX financial Today, presented outlook to

open We Q&A. it up for will

if operator, you would please. So

session. question Cacciatore question-and-answer from Co. Instructions] the will the gentlemen, line [Operator & very first you and ahead. go Cowen is from our begin Ken Please today Thank much. Ladies of we now And

much, so and morning. good Thanks

Mike, we cash pretty to of But just to and operating takes. is working be alluded on we're as the seem question all wondering the what tight the puts flow. you've are my reduction, yielding. some through on Just and do the cost flow cash we

wondering, may And there roadmap to continue you. would Just giving that? cost drive what can to any achieve beyond urgency to this you sense how a you to us the start deeper degree reductions, any Thank give can us billion? go you $X

Yes.

last by, start and let items first year. you is So course, don't me the the quarter few that say, third in see affected a of quarter and of fourth

that are $XXX have payments sort annual We incentive out the coming million. about that's

You're quarter, get bit the full the an of to as seeing first a the inventory as after in down. also holiday increase capacity little normal factories back shut QX

We seen to a of see drag also the I that that bit a we've this in February accounts continued mentioned year. little on receivable guidance

So first think, second the in better cash see all-in-all, we'll the half. I flow than half

tell at monitor course, of we'll make next little it's let this little the a we're perspective as early bit of beyond places. you and net into a goods have year, But we point, $X to terms continue to going his of Kare to billion. efficiencies give other go as savings in our Now, to this we on very cost to of you that look well. I'll that closely, Maybe

we we Yes, we to we of financial as margin of operating competitors, our of higher longer now. XX%, which than to have of have why need term, are target margins, aim improve our the that means become any is as right where which effective a an long-term is course, which

to that, set achieve to in course, place need in order that this plans so of we happens. So

this broadly this more communicate to is finish once now year. right we plan on Our

of communicate manufacturing, So we strategy that once the will what part for you we 'XX of base. is for our and the finish and cost restructuring 'XX, to

line is Jacob Our ahead. of next UBS. Navin from the go from question Please

highlighting if AUSTEDO, patient highlighting you're you you were could, on prescriptions. Just previously and

us with you've wondering to if done that in patients? metric the the similar past give regards you Just could

At very can a Yes, do feel is, between two. give for. close of There correlation sure we the least you I'm a that. course,

about I'll patient So to just what I to number. the don't think Brendan But, we there's over a difference. see you think big hand

seen continue AUSTEDO QX very strong with QX, we continues. the number demand see so growth AUSTEDO as well. We've are grow. with And look, happy QX in to Now, the We're in patient in we far currently. very where from

numbers as as the million the we're So I think from for year. perspective, continue grow and to a goal our patient of numbers the $XXX revenue achieving headed well towards

overall a And in follow-up just are on and landscape any acceleration QX? XXXX. erosion seeing QX for just you generic on relative And some U.S. price pricing, to commentary the

and comment you can can Brendan I an overall then on. you Yes, give if

don't QX. on If to it, from quite you that's external anything, pricing see deterioration Then U.S. take we a we view concerned various sources. and macro see generic it's of by clear the levels. stabilization continued If any that QX

I thing only thought they to that the assumptions our Kare we would add that exactly be. pricing would is are Yes, that for where

continue we on path. to so as that And commercial

optimization But out close know And of as the after there in ex-U.S. optimization you're in the price a completing that's sounds Will like erosion U.S., annualize optimization still I to you the it here. portfolio be in U.S., you're doing rebound annualized?

yes, gone exercise So through the the and expect rebound. there here don't I U.S. that. we've would completed we've be in

I continue on have the most that of way work marketplace through that respond. we we've seen to But competitive We and its a system. think

is Nachman line ahead. of BMO next from Our from Markets. Please question the Capital go Gary

Kare, on your highlighted. even And Emgality. out AJOVY, COPAXONE stepped how Lilly after can you level you lower that expectations, return efforts then their market revenue to who with growth shaking and in recently XXXX to just relative with is within EBITDA XQ you the up confident remain both this results,

Amgen? effectively talk Thanks. about you're resources to the Just AJOVY and both compete with putting Lilly behind

year, on could revenue AJOVY. then it because more I'll to year, next actually lose. and the expected there's lower I'm give then benefit give look If it's than some questions. And Gary. Thanks we you for less can on for see COPAXONE the sure at a this a you comes short if both in Brendan we color earnings

moving away way you like negative So it year faster in get a of a to get of out this is scenario, it. each from kind

first earnings actually that So COPAXONE, and in in us. good that the quarter the for sense, that's hit are it's we revenue projecting less that not with we bad

this Right we for basically in of that expect means be trough it, Orphan what earnings I see But which better to Whether to, looks we can instance, see course, we it. still the will depend have year TREANDA we for revenue, could happens to the on expect cannot to XXXX. XXXX the they BENDEKA. think to Designation earnings. be Drug We for expect here, don't factors now keep I be and on will good on swinging the BENDEKA. there factors. hope the revenue and it But and swing that offset So

COPAXONE expect to as have just for year COPAXONE times. AUSTEDO definitely XXXX. for of will AUSTEDO we've substantially I we and expect then growing, we see lose in have also details. out be million million a So that's will change XXXX, this and so that will trough explained in lower year of revenue and, to And XXXX. the the course, we this trough hit year less $XXX because year revenue of as wait more the for the AJOVY many to $XXX comes that But then and This course, AJOVY for earnings, have because year

because least I of in actually brand the launch much for should competition, But actually one products, that good terms down number a I the last launch as with way, market. to not products is market first and we the fast. they won't competitive whole our ask The a this the In comment expect the neutral is And the dynamics the little the because are on doing grip for very but really very share the you can That's dynamics, it's AJOVY. normally holds on very a right case from launch at well. going now. different

the the last There's ones, slight and in and two launch. next one's launch the between of So that's first AJOVY a situation. difference not the action normal mechanism so the

We to the not have we do it, U.S. but pay action, have think the a in has Europe But on to that which combination we just is, us, that by agreed to in same basic royalty issue. a the there's that's side mechanism also way, why

have have some which product and marketplace. the many benefits, are that in helping we seems us So basically have seeing to we that are the clinical

happy will XX% that's we're doing now. So with we dynamics going maybe be with level bit holding about you between some think of And maybe we're and what should But right you we very to more are Brendan, XX% kind engineering. these that. the I expect bigger say on a holding forward

Kare well well are to the Yes, been is mentioned, so as accepted thanks where big relative Kare. We're we're The in CGRP by very products focus. with centers physicians. a headache happy with the neurologists, very market. doing Yes, which we and

we course, Of have syringes. pre-filled the

auto The other two the have injectors.

as Once well right think get So will with in will we quarterly that once-a-month a of the our auto from hope as dosing And us focusing auto think, injection, bit high both it I'll a as commercial a decile, another profile call year, while out. often. share. product be so sized later significant isn't little on very we that introduce that writers. perspective, neurologists and a with very syringe is on injector new-to-brand will that issue this auto I We I think versions catalyst. mentioned, drag non-neurology to Kare the we're give in different I happy a competitive They're our a two an the into that our force market, have the sales injector. And injector pre-filled have overall

we're And monitor that competitive a so think that and resourced closely. to effectively continue very to now And voice.We right do. we'll share continue we we've compete, got to

So with we we're happy on very and know, you where bullish, AJOVY are. as

Thank you.

go Citi. line ahead. the is Abraham Please from of from Liav question next Our

this February. expectations of COPAXONE COPAXONE $XXX revenues revenues when All million for provide You guidance your noted U.S. ex-U.S. in year. the you same as

then, just expectations comments expectation to are prior for assuming the if lower you billion, can now margin you interested you you. year are relative margin, COPAXONE COPAXONE given of basically, gross full saying gross U.S. slightly on revenues? are Thank XXXX to $X.X it make in So, as that? to relates development you revenues confirm And

I'll answer COPAXONE margin. what revenues. the gross for explain Mike first expect will we question the on And then,

that COPAXONE for around completely So expectation an we is have of you're rest that $XXX absolutely of on million world the right unchanged. the

is might So to which that, the $X.X patent as And on that patents is little European is, color COPAXONE and the positive. There adds our a it, you look course, billion. very only had up noticed, at have authorities of a have upheld patents. have

each going countries. ago. upheld the of were little authorities, And patent, the Now, they course, doing a forward out are structure predicting the that that. at potential enforce a it's process Europe level because the in and Europe European go we a securing year then, uphold you need has complicated But in to the we -- they this of once higher revenues COPAXONE in of action in than of

quite the say we're of revenues COPAXONE let's So outside U.S. the the of about, stickiness optimistic

expect terms at going cover Yes, to quarter I to swings the have, the think, some we're see something do COPAXONE think, products. in we gross probably our other so and in if similar maybe better full with slightly some margin I first look and down. up year, little But slide you're generics seeing margin of And we to a the down, business. very you so

going full to somewhere think be first you year that see saw the the range us in I the overall, So quarter. you're for in

Please Oppenheimer. the ahead. from is Rajavelu go line from of question next Our Esther

trending the broadly, on question potentially in more how share My feedback pricing progresses? AUSTEDO, comment the the see then half the environment that any to AUSTEDO And year? over you you as you year for switching And on second of AUSTEDO? can prescriber patients can on

on happy be I'd comment Sure. both. to

either guessing the question. from the Ingrezza to from of is as the essence which far AUSTEDO, switching As I'm

with need is competing both And a a think highly population. there's the -- is data in market. growth specific speculating early high failures the be going dyskinesia in to on share for I I other. very are a if about that products I And don't of unmet there would you of unserved -- just any of one lot a I have products. market both did. unmet that Tardive

Ingrezza. I So reserve is competing and that AUSTEDO line to with well will my therapy just say comments first in doing

As the far relatively environment, stable. pricing pricing as environment the is

are Part goes D coverage, and some versa, do say, maybe both. or concern commercial side working that can't but both And continued And high in not contracting with vice been not think, show as as since far payers far our really we XX at as in and strategy in D pricing as the XX their look rapid advantages that proactively erosion. We have that side, think is I does enjoy launch. really access but I the Part in to competitors a access when you commercial in certainly

messaging on taking subscribers? market does AJOVY, thoughts affect maybe on on How if share get MAT oral and your then CGRPs and migraine potential impact And you step your market, usage that a the access to for can larger back for the when prevention? environment on

I this out migraine a that million There patients still market. rapidly still So are forming -- think is XX there. potential patients

But injection, problem. three happens. we as profile? injections, with oral I there's Will this now that So on agents. remember, for demand horizon and the infusion we an and when need looks the convenient And We'll like. three address competed the our still a these have potential huge all daily growth see is same week. of volume the and or in quarterly and to wait and way continue well even side an is times what oral. don't same in and case, to a see as against a I have they monthly that to efficacy We'll see weekly regimen, unmet injection There effect oral a a extremely think wait amassing a profile, know. profile world

threats. GOP, don't significant continue the think potential for we think profile as we're will happy I I competitors the a the So are think But certainly with have that that market, the and growth. -- to coming expand. plans market we future to more I And have those with

Thank much. very you

David Our Please of ahead. go Wells line from Fargo. question Maris the from next is

for billion previously say or still In the you guidance EBITDA. provided whether you're guidance of release you confirm $X.X EBITDA billion press revenue to your the the EPS and EPS to that previous guidance. revenue not I just wanted First, reaffirming stands. and $X.X

the could since or related Actavis drama And on there give quarter, context of Secondly, this -- is the lot -- in around you context can can filings. impairments disclosure provide to you. you issue? there opioid us know liability. Thank I to some that there's provide then commentary on previously? the especially you stock this any that a impairments the detail took lastly, was if you specifically what business were, this there's large just impairments But

impairments. and comment answer then David, you, usually the Thank for I'll those the because will that's do that. Mike first on questions.

I'll Now the on comment opioids.

-- So financial including it's, the And EBITDA. between billion. whole you outlook, like reaffirming confirming the financial said, we whole and are the of course, $X.X billion $X.X

thing that what a have we slide And confirming. the we whole showed. just that's it's So also that on we're

the on a straightforward impairments? answer. Mike, So very that's

was so assets of even probably Yes, an $XXX market. IPR&D the between million U.S. and the on about split in that there

we In for We make assets. in every write we can we that there no And of have longer to seeing carrying down. their or in intangibles. market the if quarter, are development the determination changes those value profile the a sustain IPR&D of the changes them large amount look

purchased large had, Actavis seeing of almost as always toll on the quarterly we we've that in we timing there's majority the acquisition. I in balance market. and them will have sheet, like million, of So been basis said, of kinds of impact occasionally, But of these course, assets these $XXX fluctuations a and as in the that products were see a we

assessment being to problem. creating share on of of be also proceedings. But much difficult of legal about significant part of accused And for then a you a of created share opioids. ongoing the opioids, a we you you tackle. based, U.S. set this is but it's over time view, care and has It's of significant I say, period opioids course, the a It problem problem would with the our long course, that can health from point problem say to the that, illegal and this been both, that misuse of can't very And prescription

is products we the originator the where have Given labeling whatsoever, manufacture generic products. we from the we that where provide what came and promotion not that exact fact do any do do and we

and thermally breakthrough of had, get generic specialty involved who are actually they products kind we not therapy So pains. on for are products, already few our the we in are promotion any opioid of ill cancer and who patients

risk very, They and have very under of FDA. people these products in mitigation very situation. So mandated rent, by a very, and so by tough The are sad significant very covered distributed are are authorities. how grants we and And always everything to and sell the to restriction lead reporting products, -- all control. relevant the strict on both we the requirements FDA the a

being something eventually can't issue. manufacturing really, Supreme I is however, the a But, in that sensitive on a which be I not if the is way, a from same. So pharmaceutical I and is wrong, of these be But view, you situation the of legal which it because done, point principal say any very in it's can, see laws would rules the would law U.S. my given proceedings surprised are for all land. And Court opioids. political sales and the anything of thing doing, we've following political way it the go whether regulations responsible to all to remains be you of sort the

Our next Randall from line ahead. question go Capital from RBC of Stanicky Please the comes Markets.

any are of or And I segment potentially out then update called the launches NuvaRing think and year? potential your I big Kare. about well. as other some you as Any for quarter and products one probably attractive Restasis the follow-up opportunities, in for those of on generic remainder this last competitors Brendan, that thinking have

boil some of me specific question the more answer macro let a just in way and I'll into so Yes, your -- down then I'll launches.

which about will for launches XX do some year potential half. have probably We of we this

us know nice early would So of of our the to a we is some -- to on mid-summer think and we should year. is bigger opportunity still If NuvaRing also that I are. for think our look as Restasis XXXX got by in plan still at front I as half where We launches, of in this plan. second the in we've Restasis,

And that's an the half of of attractive Forteo the in half that generic have year we in the the also Forteo I potential well. year, second teriparatide So launch. mentioned second for the as

would you three well. the be But opportunities. kind remaining those phrase all the good the opportunities of the as would others as of are So bigger

rest that's XXXX. of kind what launch of like So through the the looks

Kare, the some context last you in talked then quarter additional And about opportunities. savings cost of

you EPS take out a ongoing opportunity to to context about go-forward XXX the annual you Is to COGs provide there. that of that? And said basis. cost opportunity XX some that coming is on pretty it's to points still meaningful -- just point You talked where the because And XXX basis Can on XX Thanks. from business basis? overall tailwind? basis a an that's

business. from the is it Yes, overall

And systems companies. my it's total manufacturing So other in based the it's on given are level at optimizing now. we right experience of

around easy. margin base to a gross we few XX%, lucky big do just you something moves. on. which at there's cost It means with work I to many, structured can do and just clear gross a by then comes roughly not that a your that a entire by longer have confirm. We time have something of optimizing you year some It's and can experience processes thousands long business per it's that a not points improve takes a long-term that it. It's do basis over in when the And many period, factors. strategy, for you a way is have you so margin But my you XX do your XXX to something

next be the we we be margin margin, perhaps that about about thinking should the gross to gross think should and just higher we basis annually? So years Teva's moving look XX XXX be at consolidated as we by clear, to points -- several thinking

get be of difficult margin. a the see improve COGS, don't to of higher can long-term margin, You if we XX%. gross very we on a then are where improvement of have that going has now. the course, we operating than profit improvement, total from that to because target it's the Part the That's significant to come of

So that. targeting we will be like yes, something

the That XXXX, give system. restructuring. February, finish you some ongoing will on more of outline planning year our you details on we to full how We the means do of an the manufacturing see give once we we we what report on are next once optimization we'll

you. Thank

line the from ahead. Our next question Jeffrey. of is Amsellem David from Please go Piper

Thanks.

and all or revisit would out-of-pocket just could I initial those the heavy this, Thanks. just in and do competitive are willing the AJOVY, was I view costs? the steady-state landscape in normalize beyond? past you're and if spread entrants the in missed to long your be growth And that of your assumptions? launch XXs, you've but market particularly, over And the And the generic you wondering and if parts, number I the what maybe but So think on terms that on competitive of moving thoughts when commented not will XX%. in the necessarily in subsidization on term you year next Forteo. formation, then revisit What's secondly, And that how -- given the significant apologize be. during on dynamics, will potentially of

Sure.

growth me comment first, the on just let around in AJOVY that. So

and of , stabilize. if XX% think guess I think now that expect. you start will on. to the where XX% any growth market it's this early that things been was look quite more volatile do one but headed, to the challenging players to I going market probably The than that significantly and been if I that So of at than higher before has I probably expected think north that we has be say from the or demand in would I everybody would deeper been mentioned has XX%

point the three that to where get of to marketplace the As the formulary. it on will them see we products conversations all not be of available these value payers, we with net many to have the said XXXX of that a now uncommon is and many the probably had price as medications

So that. we continue to work through

coverage our overall converge about insurance and now as further XX%, year with of reimbursement. scripts the and year have along our We up of getting some XX% should of reimbursement covered our get to number with currently with decline about in continues and two-thirds, patients about is ended that is. what XX% we We last that form

to somewhere, any headed more goes. don't I I the growth that's on want probably than to see we'll out we're comment XX% where it settle really and north going but So probably that, think of where that's

not long quite I'm own it far but As We first in Forteo at easy least our think in and from us other aware exclusivity and on How goes that but an believe as be is products I -- market probably there are position, easy intelligence there we not we of. that we product. that an are we'll don't not form, sure, will it's have is -- that maintain how there first market. that one it's will

one of So the and more it's challenging one. difficult

while. So hopefully with either alone one we'll where just maybe with we're entrants have for other it a a decent runway or two

you. Thank

Our from next of is Gilbert line go the Gregg question from SunTrust. Please ahead.

Brendan, another AJOVY question.

as you parties on this the unfortunate world in of But opioid of care some understanding, trying some ways, market? to the talked gross hear of to attack reimbursement, and and have come they table in to DTC up blame the Kare those, different to a well I spend versus blame. marketing per with real SG&A about the footprint who's SG&A is people side one to the the bucket relative I and on cetera, pricing subject. on primary being et you You've about net. distributor of you lot you other think own agree reps focused front, how an the on your views of But opioid, the Company's pay. then, se on the since branded as if a and back a curious was or is of adequate levels even and ability your the confident And competitors sorry the are in that some numbers, that with light generic your I you

of on concepts recognizing you So wrong? Thanks. don't Teva did could some think maybe you anything that those comment

the I the that. and handle and first I AJOVY share will will Brendan So And question opioids. then the to we answer Brendan with go will think

Okay.

is way balance SG&A AJOVY to and always of commercial we've that far priority guy, I'm off I that we And think I the appropriate. goals. with our but more the spend have I as marketplace, focus a as AUSTEDO so on So expenses older less and would like products competitive, expenses money moved being our think to in the look to spend

the confident of hit we're be We're where voice I get to number market to satisfied are there. end look are. think with out the at year continue ways we our growth able that we seeing our of by to we with that creative will the share and to we

I from and are are think centers. sales competitive. standpoint, competitive we So in neurology I a the rep we now, Right very headache think

I competitive those We'll Things think to as decile I evolve. continue mentioned high it. non-neurology to will are continue writers. with we at look

significant have DTC to-date. We not advertising done

all bit we're multi-channel some on We looking out. The is to we course. degree that of advertising, which ways of more is different parties get at -- marketing, message benefit will your for going little there, the and out cost-effective it DTC a certainly are evaluating to

to we resourced answer the to is goals. So think and I question but to yeah, are more, bottom if that, our your appropriately like would we achieve spend line always

Thanks. Okay.

on. by states been done the plenty are be can in course starting plaintiffs guess of of other of no lawyers X,XXX those paying to who They the And the court a really with cases the than what anything [ph] regards of this real is pay to and court thinks. the cases. table most basis. probably for say is court financing There It I difficult the no so opioids. of cure more and plaintiffs. side And on not cases, It's the are

that explaining to me the the what due me misuse which the say we up be somehow, I selling or alcohol misuse And in microbreweries societal also all that serious issue group you're for is the that everybody about here. So seeing common be of traffic They is large distilleries. US, very alcohol-related broken like families, alcohol alcohol? the alcohol lawyers. all the alcohol, imagine by everybody bit accidents, big what should This it's really for to it have the of legal really a picked or a kind would manufacturing things in mean, be game of all call. reminds

run all of of do the sort and in that at of for day be illegal you how of they of how liable you at you're laws incorrect game, really end what If this. rules the it the and who but misuse can -- held the an That's follow see the lawyers course plenty the the products land, of getting way.

looking have much can I they you that money, where that's think know, And of at. they what get are we don't have at we a some so money. as they look lot debts,

won't think they'll help else It to big they I with find -- settlements. if be somebody So us. want

you. Thank

line go question ahead. is Umer next of Please the Our from from Raffat Evercore.

and on very just Thanks I on for specific to love now two taking wanted the much I question, things. quotes Kare question. last my focus your

that securitizing First being side, it's receivable. was guess clear recovered in accounts on I my first is is, half accounts And receivables. accounts question less I but noticed also the on receivable you're

exactly settlement time you place, presumably else? out something on you. lay for is Thank a think you you was that on us coming Can why there understand happening in cash on of basis? an the taken there? what's And one the So impairment flow one or a slide positive negative a just net I'm second free because cash you've say is, that to don't because have trying an so Revlimid. it Is charge or is approval

those. of I'll both take

is there is It's on. XXXX. securitization something been since were program. collect So to This securing place that's which receivables tricky notoriously a some European in

portion So investing operating years an cash reason The a million several this in of flow the program footnotes is, which you sales the piece which later not considered investing retained of of times is it's is, see receivable see these you cash the $XXX can a technically the or XX-K, see size in about XX-Q and flow. now piece that you it turns about is collect over year. you ago rules another a flow changed in two accounting upfront cash our and

flow investing positive exact but and and see quarter, operating hasn't this an cash couple last reflecting net cash been for of in minus you change real this in no million change reduction $XXX a There plus So a and mirror in over it's flow. in net. operating a Its a years. investing program of really the

need can better. So that a always take to little describe if more, that offline we you bit and you

that this there the the we But it's the in players. of a as a starting that of is change our settle longer side, agreement terms asset at acquisition have we a that settlements. are Actavis appears in single evaluate in is no initial that time from file other they the would Celgene? with Revlimid, when some now assumptions So with runway to as It came

is partially profit we that. that taken agreement on we've and that also share So there relook is at and a It a by offset an impairment have. the

basis net huge a number, but seeing that's not you're So the charge. for that

clear, anyone with But US? to haven't it. be Got just they settled in else

No, are they but our now will. expectations that

just it's an So change. expectation

Thank you.

of line the from Wilbur Elliot ahead. Raymond is question next Our Please James. from go

Kare or Brendan. for question First

at that of is a still just of the saw long-term the coming a itself? expecting what to question the want or other to sometime prior Just basically some significant in terms the will And safety product expectations ultimately fairly update course you in around us maybe for Or you Thanks. with at your peak? get looks want sort of sense of that's what we're capture what it to the the of situation a something Fasinumab has out a EpiPen time -- around full to it with like the capacity looks like change return just of this quarter there over NGFs respect I drove that? us study. supply asset then I any development? the something point? second to sense development Was generic program. in seeing And line of give It ask been change

do EpiPen I'll think I those. is of straightforward. pretty both

We one. to are and needs ramping up to EpiPen the anybody who providing buy volumes

on shelves. it We adult Anda. We're have the distributing version the to

any will within seeing And call and XX that. Anda needs it revenue we're get from who in So EpiPen hours. they pharmacy a nice just coming can

for pen junior August. the the have ready school in will start We

increasing. able share And now EpiPen the approaching approaching situation, of as be of market some this could fully it. probably to no we real Right know supply never will So will to what change But the we course we'll marketplace. XX% if share competitive is exit that there we we in XX% be competition the be do year. are

change know a us. to. exactly don't story change Fasinumab, sometime the where for what that's that's out alluding a very nice On doses. took high ago but So you was I There we

issues milligram, we one were seeing out you which eight were joints, testing of joints the of safety that high weeks now doses we why every narrowing know, seeing took the are we that milligram about the four the some we high on the weeks. every all one reason doses. And was is as and So the

the that expect also the It's good We see. case, those due studies very that will And we once for really the or had long-term and some regulators also And terms safety out coming the we've both have and low doses since a our have the that which which then in that longer will looked but data the doses then safety then of had that continuing data us is development have short-term will Regeneron will looked just time good. with continue we don't efficacy to be on those to on will it to clinical we're up low we safety duration. that safety and whether clinical and acceptable out get challenges data whether anybody on And in in from together short-term yet. have a this we on of are some come can data of confirm assist wait efficacy course and be to be the will product safety. there we that approved data, its the based

Bernstein. of next from Please Okay. is line go Ronny the The you. Gal ahead. from Thank question

And I essentially get And to going kind bit of as auto AUSTEDO, strong category is that something beginning X% it the and expect expect you not by for is to change? a prices [ph] this like to horizon Brendan, but Does like that? looks grow. Brendan. at segment you away, $XXX peak year this like range. the be know R&D Neurocrine. between disappears Kare, initially get billion fine thinking, to because might company, a to as are you And is follow-up to for you more And to thought of providing, was then I lone go accommodate more to currently guys do injector? you broadly, five In point sales billion you buying a benefit essentially for it will A scripts managed going a which on wondering, go kind in go your follow-up category. flat between generic spook positioned the beginning on little of Is bear right AJOVY, which some I've got branded and to you first pharmacy need should size was is to couple continue longer-term more or the the to three to on manage the expect a you begin percent we for and to this able sales? ESI realistic bill? Do to see be like $X was into higher that your currently of Kare. the like about revenue this your R&D

as buy adjudication I first channel the going is is vast AJOVY the dosing will retail is the expect normal going or it The don't it go the to that And far to I channel. change. and majority to to and and quarterly I retail process. bill as the question will answer

dose time. norm quarterly buy and option bill us over I expect a I the to option physician physician don't administer the option. an expect in that think can and gives and for I or the the significantly the patient don't fact gives go to become an office a the that that But

just the the the pharmacy will where for land with really access and think, -- has to assumption category, of I pricing of a if with but more and the this is, you're As mentioned, launched, specialty this category vastly retail a it moved back be kind got I think two ago I going reimbursement. this call before original regular net years is these products we've would

competitors prevalent. want has that I But need sense to that similar to a two is our is have but a unmet important strategy. don't So regards This really each dosing on definitely differences product. speculate that a don't with two marketplace population real but we be In possibility quarterly I that and an guess advantage contracting significant the again, to I against the I other. products the not to think in will this are expect one where have payers and trying pick products a AUSTEDO,

then and and think reach Neurocrine's exclusive, So that's back I My see, where strategy is exclusive were excluded. that agreement pivot is an is part the of just they this ESI guess didn't you'll be and this they why with forth. and that don't be and one other

goes, erosion expect So don't of as we the I but where will see price this type categories.

stay think I assumption the around AUSTEDO is original intact.

mean, a numbers. those did just million $XXX year. last on And I we little bit

We expect this do year. $XXX to million

it -- with realistic. end million not being stop population XXXX, it of I treated not there stop growth, out which in just at $XXX should at that's if So think the

expect So on keep nicely. to AUSTEDO we growing

On the $X spent billion you big side, R&D, innovative specialty chunk that of R&D -- could we products. is roughly the a for and on see

The anybody restructuring last is about development the XX projects plan have to those more We is you this are with about right with want reason right ongoing, two-thirds share in we share of don't that, year, year we really but and now. And to biopharmaceuticals. finish this that we are year. now our once

February our we once what with share have. you different pipeline, to we projects on what more is So next a are we the bit will get year, of

in development There R&D some phases. have in the pilot clinical machine biopharmaceutical really of overlap actual exciting plans, some We projects. is terms early the and

can we So business that do can R&D it efficient the we the and keep size we supporting have specialty at think very we now.

need it's keep course, and can Of spend around $X and with that's billion. renew a that's that supporting our and business part on of we only to total we a a business where do specialty of think we

you. Thank

line the question today JP Our ahead. from from is go of Please Schott Chris final Morgan.

had AJOVY. just on two I

for The opportunity little the the talking about a drug. EU more first is, bit

on been physicians Thanks we national kind question has products. helping you broader are ex-US like of very about I formulary. sounds with opportunity historically a But think your as migraine for was and My view thinking XXXX. wondering dynamics to at uptake is further anything broader AJOVY see was I second been legacy in was environment coverage if of up coverage current CGRP for large that different be? how being the some smaller It hurdle about a of could you an look much. on the opportunity expecting your the current -- are and just AJOVY? all formulary coverage you has there of

Chris. will Thanks one. the I'll and second the those Brendan one questions, take take first for two

comes then U.S. is of unmet migraine identical prevalence identical the of when the to medical need So EU, to is and and it course AJOVY the

an unmet medical is there enormous So need.

level is EU, we to injectables which [indiscernible] therapies. question than interesting tends reimbursement And for see the on a more in U.S. pricing have So dynamic, the next an close higher is is there biopharmaceutical pricing. that to significant

it's Now for but ironic, actually of been last the sound might how this kind years. that's XX

is European So which biopharmaceuticals in are higher price will biopharmaceutical level that price, of that AJOVY in be see that product, means relatively tablets do have in a per patient a which about met Europe than for than this the European pricing a having revenue which And since same the do. And haven't slightly course number markets of which close net often. on sophisticated the prices the higher. the a now that [indiscernible] launches United is Europe very list as is now actually the something could injectable since right to indicate market States, the we up list at price end US, that better competitive actually net would

So outlook of outlook. in there terms pricing, is of good in medical a there the I think terms unmet is need, good

are access certain get the some of order there to overcome in hurdles course, in Of to markets.

expect places will like with we like in and -- -- gradual work gatekeepers opportunity to on is Southern Scandinavia, we for launches, Europe see easier on, on where very the coming what started but and and So markets a which see Germany, launches, Brendan a exciting roll early for the through so authorities then AJOVY? we are definitely way to Once out different our that later. us. good get

to as If strategy I the was US spectrum. as three Aimovig the across the you in coverage lead to think we're in is and Yes, CGRP pretty so Emgality access of get formulary quickly. far part the across look coverage, think those and I And agents, comparable

Formulary So Xst. just on not on Emgality, April We access UnitedHealthcare. with We're Aimovig on Express to Caremark is we're Cigna is also not. reimbursing gained it. AJOVY. Preferred National Scripts

going with So our probably quarter XXXX, mentioned think as into discussion eventually the I payers previous calls, but to settles. even and expand. continued first to coverage continues in I throughout of And this it's 'XX a be

where to our and those So improve we coverage we try continue don't to position. have have discussions

it the for I that insurance physicians product, the the somewhat is been do I access physicians? that and saw you I had But to we achieve The hindrance designed us that's of way AJOVY patients goals year to first going. product for to to a a has came to the think has easy quarter out write we think don't the been would to basically the into for co-pay it quarter As really our this has for lagging question, designed been. program it it so our the that and net equation. of mentioned, getting that make and continue your easy we growth of patients to XX% adequate have that card keep out that and take is as fourth we

had with to continues decline. XX% getting now script, to up and exited And seeing build to of that's formulary the reimbursed that We patients a XX% coverage. I time So you're as it we transition now mentioned. year the

able goal. continue be go We'll to access So continue to be will problems are program for very year, but the hopefully isn't them having, really to we a through to be access that efficient we AJOVY. treat and that designed improve we it will patients as the the physicians the for

for to speak if call. Okay. are on throughout Well, and today materials participating day be have and the our the All website questions. thank joining tomorrow us the everybody you to will in on you you available

So take care. Thank you.

as concludes are will from +XX-X-XXX-XXX-XXX. anywhere listen Thank replay follows, the the this and access That to. today. available you, gentlemen. ladies U.S. telephone replay from for numbers conference you a be to and X-XXX-XXX-XXXX, the world, There to The in for else

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