Teva Pharmaceutical Industries Limited (TEVA) 9 Feb 222021 Q4 Earnings call transcript

Good day. And thank you for standing by. And welcome to the Teva Fourth Quarter and Full Year 2021 Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. advised conference be it. being Please Instructions] that is today's record [Operator President, Relations. Instructions] to today, your Vice like would Ran of the Senior [Operator now to hand I conference over Meir, Head Investor speaker Please go ahead, sir.

which you, opportunity as today of discuss be number this us earnings our of press to website year this a morning. financial review well on Teva’s for you hope can release, copy full to results. on X. and our Annette. We Thank was quarter have slides Thank as everyone XXXX call at copy found presented being slide joining A forward-looking issued you statements review the earlier fourth release had our tevapharm.com. express an this Please on

measures Kåre these and and will Teva’s on our information available non-GAAP and priorities going call financial XX-K provide SEC overview recent earnings the Forms forward. Additional today's Schultz, our our begin is XXXX release, performance, in of events CEO and an To statements XX-Q. regarding

Eli Kalif will in the results financial providing outlook. CFO, detail, financial by up before XXXX quarter overview more fourth an reviewing of follow Teva’s Our

approximately over America the is hour. available will turn would please. Joining on Eli Kåre, the of call one And presentation. Please will now during the follow with Kåre. I call call who Dethlefs Kåre run Teva's today's if Head today North will the question-and-answer and that that, Commercial be Sven to session you that note

headwind commenting guidance, revenues compared see OTC, billion. normally. patients XXXX We headwinds welcome resulted that to did of and thank start in everybody, company. you the in and Europe had for the and some U.S. doctors as And both from in our you highlights. many by fact as coming interest see Thank our generics didn't a with We much, the in initial we at less Ran, bit your I'll also basically from came in that $XX.X and marketplace U.S. general of the very volumes, COVID on

penetration products that of we in as the our So, saw is ended with we EBITDA billion very revenues. $XX.X up year. which a from slightly slower Adjusted beginning we with at $X.X predicted of of the But And we all-in-all, GAAP are the some within happy is than much diluted EPS in billion, the the at guidance. within $X.XX; and billion. middle now non-GAAP came debt at our also continues. guidance; billion, in $X.XX, down flow in came net diluted EPS to reduced free guidance; our and the at of cash $XX.X the $X.X reduction debt came came

continued. So, that is which the which hoping continued. at it nice. below It see, were be pandemic, then be look would wasn't. challenges, it handle overcame of it we of over, at course, get of the the business of to And did a beginning COVID which before lot billion, but know, XX course, long as year $XX the highlights, we operationally. we all had we If we won't We we

for we out, in refinancing, I'll comment are We the And worked all AJOVY, comment year. on. I'll saw LAI nice really growth to the of launching those nice which AUSTEDO, a following growth operations Risperidone employees we job well, whole this slides. of Then, test and about later So, a on excited of really, throughout do like all years. our did our fantastic thank all

so X,XXX somewhere to dating XXXX. lot this, different and get legacy if speak. opioid from of slide, between analysts, than So, X,XXX of a know, The -- pending this question the And, to And XXXX, side. please? had you one next to I back the all we litigation course always more on litigation go is as are cases number there's we

which basically been Now, and very had if bench brief prescriptions FDA products no making court And, some it, compliance then County, about the to decision, California, regulations in then correct, court stated a liability. we progress a be start with the public correct, we've do DEA was I decisions, nuisance trial there's and recently. the it if for in are everything you are was where regulations, with that claiming basis Orange

a we use when be a York products and us. a Then, that clear clear was, that and Court, And have compliance in again, was completely trial win So, found in we cannot are the then, was that again regulations. win where New verdict which with public to for nuisance J&J Supreme Oklahoma saying liable. rules had you all jury in were lost there a you

well. the actually York as was state of New So,

was So, verdict, from pending trial, mistrial due the which of the arguments correct. a interesting at AG to motion not that an end the as were

had and then then overdose we and we some combine a these settlements Texas, use if in to settlement So, have compensation spray, providing the Texas, that's had Louisiana know and all you you generic a switch a case product situation. we've you it's products time ago, settlement the settlement cash front, in Narcan in an both now a of when

are some of situation. get generic help it from people which forward. substance suffering we a about a very happy way this an to spray, to abuse. settlement. to So, can it's makes It care resources, makes think for And get Narcan sense in We Texas people, good sense take overdose

optimistic, always know. as I'm So, you

you If a a months. still point So, I'm the settlement I've can starting reach And that said we QX see international similar and I'm on, still reason that next that, good Truvada be can so it's that the I before. think Texas components, steady they're within didn't the that in really optimistic a that. will XX And believing Europe, and we year. nationwide steady and we we settlement those in And than go very than If had can in QX next And 'XX Truvada the slide. see you'll business. quite discussions. well. a bigger you back revenue you very QX throughout launched had in for QX And 'XX. the revenues here different Other performing that 'XX. big markets, that our that we move Atripla, the can see to and see we have slide, from for we really next and to Atripla is 'XX. the generic the ongoing launch

So, in at that's U.S. two main growth let's and first. And the AUSTEDO marketplace, look we drivers. have AJOVY. And AUSTEDO

more you can scripts tardive and be up Why you a revenue the And to down, XXX,XXX call, and debilitating, that we beginning buying around can that under slide. to increase. the at basically correlation to Huntington’s by patients quarter Let’s it. with a the basis, and saw that's You movement socially script that. increase we sometimes -- because can is can can revenue. tardive see, getting expect that quarter, for these we year, some are continue that? in some, at of continue for nice but an in significant in here. count It’s on our chorea tardive Wholesalers you see from in to a see really disease There's Huntington's, traditionally it's product, we nice also or of we movements some in and price patients, therapy. it's that dyskinesia AUSTEDO swings so expect and look are Basically average strong that's more And suffering basically the of involuntary of see basically did in indicated problem dyskinesia. revenues sometimes as taken the are fourth anticipation this see the We basically for a big very And quarter, and is a persons we you indicated to U.S. on the early course the buy also, people continue for between because from But the the bit there's wholesalers. patients growth In spec January. next diagnosed year. growth dyskinesia. volatility, have little grow underlying Huntington's of and quarter. undertreated. And price involuntary suffering It's throughout which the the avoid increase, what course, increase

Our estimate more increased of the and This broaden patients. reach course working that scripts drive speak. the sure X% of is are we making that to treated, base, drive less will is product increased ourselves. revenues will course, also benefit we than will And, of as that for

before, AJOVY. we'll increased So, that current like see to said I move optimistic are next numbers throughout looking the we year. slide, then the are also, patient If we we at

two As migraine. competing other products. preventive therapy We're with AJOVY you know, is for

for profile, duration monthly you quarterly, and We is action which and used also be very longest of benefit the have a our that product patients. both a course acting have steady clinical can profile. And basically product that the which long means flexibility means

product. the efficacy good So,

we U.S., the it we changed scripts our And grow grow you of having ago, last number our XX% And to now, out the ambition. U.S. moved you users also market lot market of see also to here continue We and have see, in is continue now the can the I around we for scripts November, that our as to share. in believe, a one share, in three a and have launched started ambition have in share, our we because least we both Europe. of EU market, XX%, We and we an And ambition at XX%. years with of then an some than having as third more U.S.

about happy will our performance a current very a launched Japan the If AJOVY which then product big in that take in we on and comment just at exciting of moment. we're It’s lot year. very of revenues And have products our just pipeline, keep we biosimilar a partner I'll We portfolio, a on here. also increasing confident in the with Otsuka. look

patients bit filed detail efficacy. exciting let the we slide, which And If just little hopefully LAI Risperidone looking with middle the with forward And we have getting move an approval, biopharmaceutical products And in LAI. more Phase development. has of been we phenomenal trial, a me And antipsychotic. this the year. to next for of Risperidone it's it to talk the We have then, showed then is LAI, in really an FDA. Risperidone X in are schizophrenia, some in

here, risk So, the of XX% by you versus was placebo. to relapse reduced up see

of find So, antipsychotics. best the can that's one results for you long-acting

call, intramuscular in it's to And use. have, that? what you and what really, So, easiest injection, make needle, muscle you which is need And antipsychotics hole efficacious painful long the That product have long-acting you the tissue. the to mean I a complicated. product. of Well, means relatively many it's relatively a also and really by a

products places. in administration volume you the very inject easy. can and of product, short the needle, injection, of So, is a with you different small This inject subcutaneous, that it's not low

an than not if basically efficacious, way is as efficacious it's that your more therapy else. easy So, to get anything

And function we're to approval. relapses, very much benefits expect therapy schizophrenia, to can a the bringing suffering the to in good order product, looking And this we forward hurt once capability. to very their patients stable get cognitive see of So, really avoid need launch we from which we this.

So, next biosimilar let's where go to give little the just you heads a portfolio. up on our I'll slide,

are XX a them that some goes programs of It's addressing of X% strong we So, of we of development. in patent off good we we believe very Roughly, in-house half biosimilars in And years. programs, can a we the value are half in-license. have grab About value. have them that portfolio. share coming that the

XX% which competitors. the pricing. our good. or on for stability a the which But, TRUXIMA, was the it's It biosimilar. is nice other look shown if And us. in are there Rituxan, marketplace, we product share, course, is which at volume very you the has a And right also think of -- have we now, biosimilar market biosimilar Of

And we does, very does products we add course, also have it commercial optimistic ensure the now to populations products are that we're medicines during launching and important Lucentis a biosimilar just in biosimilar for Also so will, about around biosimilar increased of generic launch portfolio. product world, Europe, potential worldwide. this So, our access we'll like access of year.

is classical thousands elements of network; manufacturing fulfillment it's always a margin go when the what operating excellence; the into our I by work you procurement; people It's here. And manufacturing. tell organization, headlines supply I Now, agile and in end-to-end we've organization, chain; lot in all won't not And margin. the improving. all operational margins a see been our operations. basically details some of here: focused coincidence gross our see in our you you of will on organization, also our optimizing But of

have hundreds these takes but continuation coming over way, the you're the overnight, time. that and you on all classical happens in all things. contribute specific projects that interested we that a margin of we will So, years. we’re It something do. rest to not the It's well manufacturing can optimization, are And of expansion that you can are assure the if doing things

Now, number this of explain the the sites. to at ways one of to very is simple look

you take if So, the next slide.

are showing been Company, joined you integrating Here, since we the I have in how XXXX.

remember to Teva R&D that, lot acquisitions more years, over as footprint also by it of leaves very a leaves of sites, that XX and a a have offices, than more company but You sites, of is than created complex manufacturing capabilities. XX of

have to trick how So, bigger sites, down manufacturing five is your all strengths, plans that have sites, And can here around here but operational this. to from efficient, years, the keep your you the sites. last sites capabilities, fewer XX, we your see to continue XX consolidate you all keep gone over get so we and more

will sites. we decommissioning be or couple years, another the Over around divesting XX probably next

will thing So, sites. this sites and our R&D The office of for continue. will our evolution happen same course

more continued the years. optimization, in coming So, come to

Now, business, at our if improving. margin we an take example you notice then that and the will is here here, look European operating

also the reasons, operation two in as the but about, you one And you driving of optimize the other the consolidate as one you sales of say margin those and improves just factors margin consolidate Europe. up been margin two commercial a for improvements course I operating that, percent Now, have your your commercial that comes gross also your commercial cost talked offices, is down. as then could operating is, basically

having and U.S. XX%, a strong contribution to operating in You take the because mainly gross here. closer talked and getting again, both, and here footprint lot margins, let’s we're optimized from nice a very look with commercial to I've margin XX% the at Europe, see to just markets. international about that margin from a improve, something development, very, continue would But the now can the

here on driven COPAXONE. in 'XX. the That had of a significant see how from really consequence 'XX, in bad as down we You revenues can is expired XX.X% run a the drop COPAXONE in to XX.X% down patent by

Now, be as in revenue. COPAXONE than you is now this down, will $X year billion less know,

be in see, said well new will on always to And we way wrong we target. future year, our at you close we be are that gross a is this and part of working set the get our 'XX margin, target and we very -- hit have just so you, ago don't that. operating five of four it not we actually might it's hard will major margin. until the I we to that it target then And that bring impression targets, later I've our margin we And years a that so can our been a the So, factor as we in improve anymore. told share 'XX for you five-year end or with XXXX, get years But targets won't as from but ago, that, And to hit the will actually target XX%. be the that you XX%. stopping

to tells a element margin strategy. Well, It’s And it will our that's key something operating important. about continue the important? drive-up us why a next starting with so have because since is we point of debt. much why too slide it's We

to cash debt. allocate cash debt we need down to flow to have generate drive cash the ways higher flow, and margin. the And the And supposed to reducing the So, drive the generate way is a to the down operating to is only debt.

a debt been course we’ve the with year. some $X $XX how of same together. roughly interest rates, been we’ve course, the you In about 'XX therefore, So fits taking And billion down paying of thing, period, since billion. whole see

start the allocating all pressure cash coming can a point. need of bondholders. we over that the reach time be in say at billion bondholders in big a could be last when years, This paid then, that point you coming the there years. have calculate the and years. course But And $XX nice liquidity that to don't to allocate all shareholders, we continue can excess which to of to time will to in we cash will you some will So, course,

Now, debt on to and that's we year. every repay we that, the to really course way stacks, our of need manage need what much call debt we to debt how

your we the You flow back between cash have year, balance you're And did need a every and a the paying refinancing operational to last of debt year. successful $X billion.

purpose bonds basically, $X the So a borrowed of what liquidity billion our liquidity getting from that repaying for the all bonds. good matches that with bonds repaid $X by we the three we checking out line, balance And existing three selling profile, next by by wise, And are so a more we generate billion flat the repayment means repaying there's debt cash that years. operating and the flow. over years, next we between the

issued change can this And And makes new thing, How that's high basically, you millions target of first for the cost of a of things And for in health do? hundreds the linked sustainability world's really supplying low look linked set then, can to did we what for called leading world. we take bonds. we bonds. a targets we which fashion. we at to world? Now, are target. over societies of Because quality is generic Well, medicines sustainability care the people up what's their sort all climate the in a We if more sense a do medicines these the at you we high by issues. better Well, And so company. of know, us. pharma they a quality, lot supply new

reduction And that. with actually, improvement hand gross So best our by climate greenhouse to to it's we’re improve your the gases funny, XXXX, reduction footprint the greenhouse use because in of resources. best is and way on hand to goes the margin, do gases because it's in way a in well

more the gross the the is resources manufacturing, and you your in less less to the efficient data harm manufacture, margin. So, are use the you environment, you

financial these can can these environmental thing middle regulatory manufacture patients ensure needs the low the with targets. to volumes in healthcare can And than So, approval brought all in We systems. countries. basic targets society then, can healthcare medicines helping medicines we are income hand We medicines else. that actual probably is better medicines in that what a to ensure and do the go a we that in on countries, essential list, On really access, system. hand have this the get are WHO’s anybody the

So, that's and that's to the what in we coming we’re see of doing committed years meet and everybody reporting doing these new so course, can we the targets of what be that bonds. that will on,

Now, I the about talked profile. debt maturity

quick did. here a look what of we Just

see of between will time our maturities around ‘XX, the taking by billion around operating that took we So, maturities before into $X and three repayments, pushed And ‘XX, pushing need that. you debts it of bonds the so could, refinancing for X, basically do the probably ‘XX, can in we be will to one of sorry, ‘XX, out on. to the a or cash around billion ‘XX can $X need debt balance last ‘XX, And and ‘XX, Then, back to ‘XX taking $X do we'll get ‘XX, rest time to have and and to also we lever say, that ‘XX the ’XX to we here ‘XX last And the see into we mark. you -- years down and billion. Again, next flow. ‘XX. those you something

the is long-term EBITDA debt we already and the XX%; Eli away think been upon with here which a since to happens It income above cash-to-earnings we to patient margin, the that secure are below see over of our deserve raise to see equity. end last cash utilizing when you come Now, course, all I equity we And that target: and financial plan by We it about you down that times our CFO, committed of has to slide, and that, down. are of the our of nice course get any which sticking value XX don't to repayments; cash talked predicated for what coming to And this full net opioid operating debt, Kalif. the our have X the ’XX. takes tells XXXX. my debt slide, that there holders good just litigation and go is pay to And I'll we benefit eventually. that hand to me

a Thank behind with review guidance on be of you, This afternoon financial followed the Good and our will Kåre. it. and by performance. my an introduction non-GAAP being morning the to XXXX our XXXX I'll fourth begin assumptions everyone. of quarter focus main some of important results

in the XXXX a was $X.X were products offset North This XXXX. I of to and compared COPAXONE, the generics would mainly touch dollar from to discussions While on in around of partially come GAAP spots assist revenues the terms guidance local revenues will decrease currency you fourth lower in XXXX forward-looking due trends slide our expectation end most will of the America to at higher like AJOVY. decrease modeling. your AUSTEDO a presentation, XX, from to the regarding of start with and both X% QX Revenues by quarter upon few my Beginning billion, I our and of fourth quarter performance. along way U.S. with in

the to Kåre purchasing COVID-XX of stocking continued revenue pandemic patterns. on on As earlier, impact and affected be ongoing the our markets and customer mentioned by

generic of sake totaling note product included in and the sales of XXXX. million would to approximately QX for the For that year-over-year XXXX million comparison, $XXX year I $XX like Japan full

have communicated, XXXX, February manufacturing were previously sites of divested X, the with we along these As in Japan. as products

generic we products mainly the the are in our North launches products in driven As in compared discussed in XXXX. generic fewer XXXX, from by past, have to was decrease America we seeing the revenues

income operating fourth income of to loss hedging the in $XX $XX negatively of a compared $XXX compared the million of movements XXXX. million QX GAAP million XXXX, net net QX revenues impacted rates to $XXX ‘XX QX by ‘XX of QX million to XXXX. exchange compared million quarter in XXXX. We was effects, net had in $XXX Foreign the of fourth during quarter in

fourth per slide income the adjustments to and XXXX. related QX opioid quarter fourth you than approximately XXXX, the $XXX were with non-GAAP XXXX was bigger QX XXXX the the of were by XX, Turning Non-GAAP earnings in liability $X,XXX net can these million $XXX see that the share to million. of adjusted for litigation to In non-GAAP increased quarter exclude approximately million items.

of Additional long totaling cost notable million, assets, non-GAAP is include the in goods adjustments million. assets which of intangible amortization of included purchased $XXX majority totaling of sold and lived impairment $XXX

slide X% our approximately to non-GAAP decline totaled of performance. XX, which review fourth compared $XX.X Annual for quarter our revenues to discussed have billion. XXXX. billion, I Moving a of already revenues, $X.X were

down to move to XX.X% profit XX.X% compared look Year-over-year, margin margin. to let's and in on non-GAAP total gross the Now, improved XXXX. P&L

non-GAAP from non-GAAP product efforts our driven partially 'XX profitability Europe improved international profit was compared increase the XXXX. the XX.X% mainly due improved gross for year-to-date sold. of mainly The segment, change also and our QX and sales Our due XX.X% higher AJOVY, by lower competition. COPAXONE well The optimize gross by to goods driven in and both was as profit to margin from generic of ongoing higher in North AUSTEDO markets, to margin cost by generic in revenue to offset increase gross our to our profitability our portfolio profitability improved QX the profit quarter America non-GAAP mix, margin in in in

was mainly was XX.X% XXXX in by higher XX.X% increase This gross mentioned in Our above. non-GAAP profit driven operating QX XX.X% XXXX. non-GAAP versus XXXX. operating margin was XX.X% margin versus margin

financial were expenses million. comprised $XXX non-GAAP in Our XXXX from mainly expenses, interest were

rate refinancing, marginally $X.XX XXXX, our the recent to we to $X to an finance compared per increase with We ended due billion. share earnings to lower QX $X.XX annual quarter a mostly XXXX, run expenses our in spending. a ahead non-GAAP expect following Looking approximately of to

slide our approximately declined XX. to that quarterly by XX%. We Turning see base spend

lower to base, the net Most active related to operational at comparison, was of spend annual in sales, a or ongoing network. operating lower goods spend to declined our base sold, FX. our decrease Looking global management the annual the transform of partially million, due efforts as as of cost contributed $XXX well also ongoing expenses $XXX Lower of to year-to-date due our to a the decline expenses. such million our mainly

end Looking ahead to base our procurement to chain integration, optimization below remain to on and being restructuring, ongoing $XX and the and sold supply the with XXXX, through of billion, organization. of agile continue network reducing This stabilizing level end lead cost spend on goods XX% an to above model to end operating 'XX. margin of ultimate we cost margin focus our XX% will we quality XXXX, expect in excellent, and overall operational goal operating the as effort operating efforts by excellent, of

free to on flow Turning cash XX. slide

versus North free QX. The by sequential cash cash to in divestures billion rebound QX offset free QX assets, partially XXXX. compared was year generated XXXX other in Our XXXX. lower cash from offices during and mainly XXXX billion The and segment America in flow increase of the we higher extending resulted full $X.X saw from in profit quarter in the and fourth million, XXXX $X.X was flow $XXX

slide to Turning XX.

XX% year full increase was year for XXXX full mainly driven XX% by partially cash-to-earnings Our free higher versus for net was offset The cash XXXX. income. by flow higher

Turning to slide XX.

shared to decrease. our Kåre before, debt As continues

the net free well to as the as flow $X.X our due QX during maturities our to rate to debt was at in at exchange debt Our mainly debt of $XX.X the the The Upcoming in XXXX gross due year. mainly billion debt XXXX. compared net the cash increase generation was was The $XX.X billion, end end billion fluctuations. decrease include repayments in of [XXXX].

for the with place times $X decline by in in of ‘XX took X.XX at end net Our $X to tender to completed We're progress continue coming 'XX. times refinancing towards successful we sustainability-linked that November and our that continued We billion debt EBITDA X under pleased offer. to be to very 'XX QX year. as target offering make billion bond

our and to measure KPIs ambitious of part our SLB have we contribution social environmental set to As offering, measures.

link been clear to direct includes its a and deleveraging. was consistent our has with between The financial is neutral corporate commitment to our intention strategy. a the transaction. funding continue Teva and debt establish strategy, which very This responsibility commitments Our long-term

earlier, strategy our are our pleased as with looking with ahead, it's profile to As Kåre explained and focus ‘XX long-term financial targets. and us we on ‘XX for our liquidity maturity aligned help ‘XX

Now, for our first to non-GAAP let's we XXXX introducing attention outlook, which our today. are time turn the

cash slide range our components outlook: expected on flow, find including five main key you operating and the products. well additional for revenue per earnings components EBITDA; XX, share; Here will revenues; free of income; as as

navigating worked Our pandemic. ongoing hard through the company the of XXXX, impact

While exact and This we COVID-XX billion foreign U.S. XXXX, we expected of the our dollar in guidance regard exchange XXXX foreign continue compared to somewhat global the of predict on of this exchange non-U.S. sales revenue stronger billion. impact our $XX.X in magnitude larger XXXX came With to of product in total XX% of to revenue, from dollar approximately a begin cannot $XX.X reduction utilization purchasing to revenue patients, the to since be specifically the includes with we results and pattern mind, generic which between denominated and in impact currency. rate. expect face by overall environment customers, volatile we launches the our

to the in is in AUSTEDO into guidance, million The effect the offsetting expect growth factored ongoing to our COPAXONE of and expected million. AJOVY XXXX $XXX greater by we decline of by of continued decline The majority have U.S. COPAXONE revenue, be than the the global which $XXX erosion during sales. a expected should We approximately decline approximately

Furthermore, our we approximately between of spend non-GAAP income to EBITDA operating account base, range non-GAAP our $X.XX between X.X be $X expected to patient a of $XXX Using billion modest to momentum $X.X to earnings and markets. $X.XX. XXXX. with to the of our be expected billion, continue expected sales With total international approximately of Europe the in We U.S., grow in to $X annual AUSTEDO approximately XXXX. benefit are is in million share shares, $X.X $X.X expected AJOVY expected Global billion and continued in AJOVY expected to be to revenue a is growth decline in from share billion. billion to to is expect per be a billion

of share we to-date, it you of and I we As gradual be will and by our generated be be first lowest quarterly with year. in do second four XX% progression modeling. assist free and the expected year, cash know, in $X.X your and quarters to throughout to in provide second we is of you this two-thirds I XXXX XX% Similar of free generated second thinking for quarter half. to Based generated how the sales are a hope we XXXX. will be XXXX, in flow XXXX sales of of be about approximately with the on in the to to will be cash expect $X.X color quarter. to approximately the the Overall, annual the the the to flow XXXX about that expectation first you one-third revenue our half thought, first expect billion. pickup of the of we the earnings, earnings in the range not half that with billion half both, the helpful guidance, expect

tax XX.X%, XX% to. Lastly, the our below we was non-GAAP guided In looking XXXX, which originally was to XX% at tax. range

we as higher rate. range tax average which XX% be fiscal As look This of the XXXX. mix mainly to than carries of other results increase expected fourth in quarter by we year for our is to rate driven of the products review and the my concludes to tax well Teva ahead This XX%. XXXX, items, year-over-year

you Operator, and answers. now the questions We call will open open for questions? call please for the will

from Instructions] first the comes Please from Evercore. of [Operator Raffat question. line ask your Umer And the

is Your open. now line

taking Thanks headline the like reconciliations? perhaps settlement up in successfully negotiate. you with something but up headline the is the million, it to it J&J's or theme, reported. a number because XX%. favorable which volume the noticed there sales up quarter-over-quarter, to are Texas so the happened, inventory at AUSTEDO would global versus a on able for interesting, be change meaning It's the is so headline really off net was versus to not helpful. J&J That $XXX Texas far put very for million, And about my that I'm you're almost $XXX I X% guys. Also, opioid much as I Is looks and/or relates XX% to the guess, unique RX little gross question. QX. per Hi, confused dollars are

versus if that close to the and So nationwide, they presumably, headline form you're the for especially it. you financial J&J, more your interest are really should as numbers basis status a tracking as considering lot probably appreciate

wasn't So, that Because fully why work? I quick finally, just I we traction yet. recruited know And seeing more aren't one. trial fibromyalgia noticed not on Did just CGRP. potential a even a nationwide for settlement?

Sven the one two for the then questions. from last Umer, three I'll you, -- ones, AUSTEDO. last and let I'll answer about Thank one those start and

by it -- So, it's that futile fibromyalgia, trial. we it who done. had would the that was have on a that to conclusion of futility look be the And a continue experts the analysis correct into recorded

So, be continuing not fibromyalgia. will into we looking

absolutely correct So observed. that's

can the nationwide I as could coming that the reach we settlement are still On opioids that piece, say you said a XX in optimistic, we months.

have basically and was over $XX And of And last been, the why the dialogue which period the Whereas in initial Texas, was in in think thing framework, nationwide it a didn't reason fair third over Narcan [indiscernible], of balance we thirds is coming course, million not did then, fees a and fly we any them. have cash from in it And have course, very means $XX of two attractive overdoses; you $XXX cash which years. $XXX they more mainly the for product. that not billion in in you, then, didn't spray, was other the because We years. constant say And million it less product couple products, good the I product that cash could treatment million remember, say, fly. of of was the generic in see it's to where and opioid really really new part. to of

a setup. that's more think appealing I

this, I'll then, would pass the if a on then I that there's a that And was agree reach nationwide answering we now with settlement. question. can it doing probably probability So, higher you on AUSTEDO to Sven

Yes. Kåre. Thanks,

of we XXXX. So, count Umer, had for AUSTEDO half higher script second half the first the in than XXXX, XX%, a of in

was step up. the the Actually, month we So, saw strongest good in also year strongest trajectory. and December our a had very that

of the always quarter context we know also is in AUSTEDO. that that, QX for So, strongest the one

spec buying earlier one factor. it a causes price took wholesaler that to due that the have to we for by the increase that We January And was XXXX.

one, quarter which was year. for contributed we the script last -- to second patient a as And per slight improvement count. The saw dose a explained in strong in also daily I the

comes And line Bernstein. from of the Ronny Gal from question next the

that? you ones. Kåre, if you dilutive this Given comes is three royalty-free sensitivity this partnerships? biosimilar of give And a interest rates little product, margin? becoming third, increase a us bigger a and don't mind, impact gross the for LAI, feel some those can X% How talk think give for do or there there's in interest with us to your your to quick margins beyond, the Risperidone that a feel out One, Second, your you can is much sensitivity bit there? in you about XXXX we about if to earnings own or in rates? XXXX. stream just Essentially, are that your a will accretive

much, you Ronny. very Thank

about is to just I first think What need the question? repeat Risperidone specific LAI. to the I question

royalty own you do on So, own this? Do royalty-free? it you

Okay.

product LAI So, also small the to on MedinCell. developed have using product. same in our this by product. on LAI we prolongation for the have technology based product. us the And dilutive technology a technology. And olanzapine not in margins we in-license royalty from launched is we're Risperidone They we It's when are a using development this paying that

margin to be overall healthy. We expect and Risperidone LAI the good of

value can more of volume dosing with offering segment, by also simply long-acting So market we unbeaten share a convenient and efficacy. fact about optimistic better reasonable very the the are and that a we grab share in

that guess, question because margin. Then the I also the Ronny. So, correct that I'm the And on... me two please about questions if first covers there, was wrong

Yes.

second dilutive The partnership your was question gross margins. to around this accretive or margin? Is the biosimilar

Okay.

with actual that not. can compete with they're no, traditional partner, the So could have -- once market, with costs. get a it's a the that development even of you into It's so a But say, split higher generics. course, margin basically you biosimilars,

diluting. products the such not not it's can we same as rate. margin It's, So Then if the overall overall a last the COPAXONE, But interest look of specialty our our margins, then you course, match patented have. in-licensed on biosimilar at margins instance. products the for as question

sold I'll in just is debt note bonds that the on First, all marketplace. our based been have that

rates. not interest influenced moves any in are they in So, really any way by

locked. that question billion $XX So is debt interest had, we the is all simple the of rate the

payments. And The a the factor which So, locked euro we to some coming there's rate due and means cost goes interest there is can over the questions. euros dollar, all the our the very down up variable fact we also dollars, any in, is, on But a net no years, and between up the both don't down interest and the whether the a yearly going the debt. of precise. finance which effect predictable have only rates way, rate that debt of of it's versus our in extremely little debt, rate there's you of the it's for in and conversion of the exchange swing because size affect interest dollars euros. the can Thank size course, of very, predict other bit than that, and any into

comes the question And line next the Elliot of James. from from Raymond Wilbur

about margin basis-point perhaps a little XXXX? insight get gross question, the you of In trying the could First provide light Eli. gross color bit expected strong us in to what to into XXX top the of Then, key the is just a follow-up ongoing for manufacturing more Kåre is trends. and on versus sense year-over-year lighter or be outlook, and see really product. does this Question not be activation you impact. trends going improvement, Just growth haven't with driver probably roughly question rationalization population remains for going the margin performance favorable for mix benefit better external a the said line Obviously, is, to to growing some the years, capture TD initiated that from expectations, AUSTEDO that to next several very we're And gains captured. within underpenetrated, see you the market at years. the guys there, some expectations next the to X guys much product under more starting than market, some and the incremental of efforts slower you really perhaps branded peak I have look X anything but expected. for patient know over if segment really

sort any billion $X.X there's in Thanks. in can if to of So, this think external that the you roughly estimates of X X provide terms be versus product can color where years you project.

you Eli, the first margin? So for

question. Yes. for Thanks, the Elliot,

the bit a remarks back to just prepared So, of Kåre.

that You core And we on planned more as that able mentioned, that manufacturing XX be getting saw XXXX. that have as we one, we're in going top sites. Kåre to around to means how the cost reduced, of still which position, we're the our manufacturing mostly is reduce well

gross XXX our modeling, kind on that going basis we considering benefit when products, additional to which of really to are points the talk on a likely we're on So, not between means of our XX we're a getting doing mix most in heavily XXXX, margin.

keep Eli. by and Yes, rationalization. on optimization, term consolidation, you gross up pushing, margin on you, we keep expect should Thank also classical that we'll the pushing longer

years X out. to AUSTEDO, on Now, X to

that happen know, because basically the think over about think product benefits that a due keep will probably assumptions discuss sales love any on peak assumptions. to we many also medical People the the get But what the showed you alluded I'd slide. And large on the never with coming product and yourself always AUSTEDO and that so forget number. nicely, the need think I unmet on you of growing clinical will to just we are AUSTEDO there to I As years.

faster. we'll probably them about they be will If we conceptually, And also more you get think titrated and keep there's want will then longer a to chance patients. it

seeing over that what your years. And down than then terms X I comment on million. AUSTEDO? I Sven, we number sales is will it can you you growth don't are we estimating coming growth, with and see that be see in and maybe, do just that why will that and we on see But presentation on, are $X.X to growing should optimize agree $XXX billion get to titration sure. So, slow the of plans But so year, higher reason to math peak can X any what both do this you product own which absolute you out. for years the

Yes.

our of for activate I growth sources with recently field doing us. That's patients for the our the I We physician one. three dyskinesia group. diagnosis rate launched our is, patient we and number. force with number tardive to the improve already and more see One with course, TV need what think for -- That's campaign. we're

reach The of you course, so second dose per for rate. the correlated clinical ability element for especially data this of the with we see is for benefits disease, is optimal chronic look the And this also our long-term learned, there, where working I treatment us day an to that's, third patient patients still this key the growth element us. adherence growth a something COPAXONE here a And optimize the third for an titration, with franchise for the to for population. and is we that for treatment there's directly with think, element drug. when level -- element is better the that And because stands that's product rates at current

for Thank Sven. you Thanks, the questions.

And question next the comes of Citi. Navann line from Ty the from

on is assume guidance? my on costs. And a you COVID your question behind then, impact are do What XXXX So, assumptions lingering the generics business? the second

be will So, the midpoint XXXX slightly EBITDA lower. margin

And The Teva’s you one the opioids. we Thank peer comment market a settlement, your it for quick on share with Endo? line compare your can Texas driven expectation? was you. especially assumptions state, R&D Was in So, SG&A versus your if by just it in then, XXXX? and on

those for comment last, three questions. handle then you will SG&A piece. first Thank and the I Eli and the the on will

And levels -- in in the to the are if prescription but still sense, marketplace, now total in end effect assumption So, openings will optimistic we U.S., we're is optimistic of this negative guidance little in for were but COVID, continued and seeing a cautious are happen in on high for we a below in that will to not but they say, what close could say the of you COVID. see general. optimistic the the our level general, volumes a specifically we XXXX, assumption, from the activity. in only back you of that relatively year lower guidance we and just Europe that us, see range would above we in And getting in terms economic the get level also in of a Europe society bit 'XX

we within new range you happens. we see of to, guidance, really we is, So, that and see or of course, able our our the our have there on risk to that widened have will revenues -- alluded assumption. whatever. will And also be because have that But we some if is that lockdowns continued like that to manage the kind you

out where possibilities So, three piece. the nationwide that the think nationwide I'll big that's the that it's that does distributors. then you What of thinking states a about the little And was Then taxes way when with you mainly it piece. settlement that times handle a the XX COVID say Texas, on population higher the we would be by calculation. it's skewed should lines get about straight that the you it basically way the that means we is of out the smaller opioid and The a a done are settlement in say bit along formula a do think really J&J slightly straight really is It percentage mean? a if population but so population than the settlement. population population-based, calculation, you would

like then or into aside related that SG&A, are about last will settlement, individual expect a that. that to we have move to specific if the population nationwide the you went with successful you principle based. percentage anything would it's principle there. used nationwide we anything we expect But question roughly that If that's about not really then, settlements the be do That's Eli? It's the products of the XX. J&J, And by

Yes.

question. thanks, Navann, your for So

You asked both on SG&A. R&D and

less of of about manage that so first able OpEx vitalization terms in actually it's terms on went the or of So, I we Overall, nothing there if for half the overall, elements were QX between think same second half in first dollars. to down that more some of the are There all you 'XX to 'XX, It's XX.X%, variable our look R&D. projects, in specific. priorities. -- same versus the

Thank you for the questions.

question from the comes And the Schott of JP line from Chris next Morgan.

Just two me. for

First, would confirm, I half the think to be of mentioned that you the XX% for total wanted just sales first year. I

And half kind half I the skewed trying bigger maybe what's first think question it's American second maybe a versus second picture driving bit swing. we've than North that a of seen. on more more And is to bit generics. typically just I'm of elaborate one a

I run in past, talked your $X here. as think kind you billion a about of rate target the

think happen about whatever something talk think to past you we go much. get you bit few to the et as been Thanks what about have, Can of that I needs launches you've quarters. little level? you below to type through we that for year? is as a about think to reasonable back so go XXXX cetera, through the And that as

the and the comment one, will second, for on Chris. question. Thanks I will the comment first questions, on North American Sven then

of when skewed on years, sensitive Sven other this what is we've it American correct the seen year and a than what it's that bit it's some launches. we're ones. in estimating North probably have -- So, but comment more can to very And we

see see We are affect affect we second that we will half. first more will will the then launches estimating that half,

of carried the not and we really to into like we're Truvada Atripla So, XXXX. quarter carrying first

that U.S. year. quarter did, fourth have a say, of first first don't generic you would quarter last tail at 'XX that We we into our LAI, launch coming that the generic are If we some had you Risperidone launches carrying We in look of quarter 'XX. do several have big sales, the of we still launches. up, of

so you And the on. mainly those the have and reverse the we down things the quarter. the basic rebate takes So, donut half. pharma various have have And schemes always we've affect quarter. most typically do first thing then, That in that on fourth seasonality those on companies hole that will the had that second happening we have

nothing we it make billion So, behind for than than slightly -- about more but normal, run it clear America $X talking sure Generics maybe, we that extraordinary should you North maybe operational make we’re America. Sven, plans. comment really can North run there's it's on U.S. our the always other just skewed rate And

you, U.S. over really and it's Canada. So But, to Sven.

segments: Yes. reported are and The Teva the North business. in American generics generics three Canada, sales U.S. biosimilars,

a quite XXXX, And you XXXX, a launch or how we I absent confident to billion $X goes complex -- get generics from billion billion address the a the in target. XXXX. the it above years, to how as We're launch. business $X tell was were an the generics in And large gives you launch in excellent idea -- good we we goes. it $X that that think XXXX, value generics where the quite and about we with strong billion think Atripla, Truvada target. we have have year originator you with And an basically, So and biosimilar a sales. $X It a that in in you of below had I biosimilar two and were

Thank for you the you. questions. Thank

next Gary Capital the question the comes of Markets. line BMO And from Nachman from

That's previously Kåre, year. normalizes? terms COVID as we especially Are talking of EPS, now trough were that first. be year trough in 'XX XXXX revenue and confident you a should a about if

this have Talk that place spend some the I about your with that and ends actually you path. going opioid activities force real be like litigation, if with that Risperidone sheet, this back maybe of year? seems settlement sales type Second, down prelaunch the cash, then sort in being, in can balance product, of you're half LAI, on the the do doing, that absorb nationwide And of there'll on mix? is you It curious, launch something if the guess, one-third to incremental just any one-third product? that up you're

the three risperidone for Sven will and the Thanks I'll then those ones address address two questions. first question.

probably of so years. the confirm that And I reason is, or trough am that can 'XX X% below the growth of that but this you the COVID of that. let's AUSTEDO say, that will X% that visits, year, in the 'XX, Europe see around would and expecting volumes expecting be speak, in zero diseases is about less not say, to X% of that course, will you we we to U.S. a doctor with hospital visits be were, down below we're And higher. And I'm -- XXXX I trough being like the what something and of down, and keep it on will $X of will the year. absolute on come so number had is two 'XX normalization could on getting the have and and amount that COPAXONE volume billion less, seen to higher we the have combination if talking So, the going now AJOVY effect related what unfortunately, and volumes to expected dynamics is And course, for of combine and COVID-XX.

grip we see. then on the And we also marginal have that's get see as we case will if in you increase the means a good can revenues, on an EPS. that confident just also increase I'm a because So, that margins, that

a we trough regard over schedule given of and opioids to third manage of it So, then would, two-thirds all seen balance say, the the and our course, possible over years, tomorrow, not provide to by, that's the that we basically many over Texas which this products With have settlement XX year. And a be could with of able it a you -- value balance settlement. were we're and debt the pay sheet then within years, component, XX the years that's in regard If the is to spreading structure. have. the you to payment sheet, what is for we cash

So, from suffering actually and generic U.S. finding to dedicated a actually on manufactured adding plants spray Narcan a this have to having benefit Lake is manufacturing to created suffering City there, people the nice the actually overdose in setup people directly of product substance Salt way by including product in the abuse abuse. a that it's the of get from a get the everybody, American way you there. substance settlement people, benefits component situation. in that in And we've one because a an manufacturing you twist our And

manufacturing good U.S. helps being population also that something in the manufactured So, that the it's for U.S. have here you U.S.

a it I So, very that nationwide hope a our and can sheet. think it's within be good settlement. able I inspire everybody settlement, we balance to reach to manage will

Sven. risperidone, to the last you, over question on Now,

Yes.

And launch the the product. a So and commercial within sales by in finance spend we yes, step-up reallocating is we the we SG&A place, including when this in organization force, our will resources budget. see the

more Gerberry Jason is from And America. there one from question of Bank

opioid other one the on Just follow-up front.

equation. for J&J distributor a for implementation think of the February there's XXth the side final I deadline

Teva to would top too or into little in happen I'd its the to counterparties imagine So, subsequently? way for deal, is announce a global participation to have that much bigger its to a constituents. negotiate deal time line your love would

would the be So, And residual I'm how piece ultimately, curious look characterize leverage settlement much settlement? do then, global we versus a opt-in the game would unsatisfactory this at how Thanks. how global you And existing when the later in true then, late litigation ultimately, the there. we're too you in after framework? if month, burden final just

see not settlements been into a product else have as will months. we course, three around likely and distributors our reaching have of the Aiming, aim it's And in also settlement component, next We at communication It's to that nobody XX most settlement nationwide that join be that a which our the different separately. J&J the has. within reaching. communicated

we how that's see that. So,

do comprehensive In settlement. how the a piece, to really terms to It's get all get speak, of how holistic subdivisions. you about so

Texas, did we did it what basically Louisiana and the subdivisions. in look you in all includes if we what So, at

you J&J you've So, same as have situation the if us, you think about settlement, nationwide and for seen distributors. the for

the of course, settlements don't have from J&J of go litigation into. this. along companies. it a participation really are think majority I'm the majority It subdivisions and up trial in what's And above makes the the will sense go makes we're rates of twist any XXs to the to for and to with eventually it and insights distributors see we [indiscernible]. of lot what I need we'll because going over get that It it's trying see just the it really too It the answers how population. the a to along their I've I pursue into question. and don't You to sense just from otherwise, divisions But seeing, states. of and vehicle been much I sense And increasing actually of against that problematic with we terms I've for the a of for publicly And I has the states much seeing -- What have city makes the makes that. available whole not and for for or this, as get a I makes reading, subdivisions hope XXs, settled. because you are is, a that of many tail sense don't out subdivisions. states this think And state seeing been I there. which county once stock won't going sense for in

remarks. your Please you. with Thank continue closing

pleasure you questions joining nice for safe to wish call. everyone, you. So, the talking And and thank day. Bye, a the and taking was you, bye. all It I a

conclude you today. That for you. does Thank for our participating. Thank conference

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