Tags: TEVA | drugs | pharma | stocks

Drug Maker Teva Thrives on Generics

By    |   Monday, 03 Oct 2011 03:20 PM

Teva Pharmaceutical Industries (TEVA) benefits from its status as the world’s largest generic drug maker. Its heft gives the Israeli company the ability to both develop drugs of its own and to buy other drug manufacturers.

“We anticipate over a dozen launches over the balance of the year,” including an exclusive generic version of Eli Lilly’s Zyprexa schizophrenia drug in October, Teva CEO Shlomo Yanai said in a July 27 conference call. Zyprexa generated sales of $5.03 billion in 2010.

Teva has a range of brand-name drugs of which it may seek to produce generics: GlaxoSmithKline’s HIV medicine Combivir, UCB’s allergy drug Xyzal, and Medicis Pharmaceutical’s acne treatment Solodyn, Teva President of U.S. Operations Bill Marth said in the call.

On the acquisition side, Teva expects to complete its $6.8 billion purchase of U.S. specialty drug maker Cephalon in October. The purchase gives Teva more than 30 drugs in late-stage trials. That could help the company lessen its dependence on multiple sclerosis drug Copaxone, which accounts for about 15 percent of the company’s sales and loses patent protection in 2014.

“We see Cephalon providing diversification into new pain and oncology treatments, and strengthening the overall branded business ahead of impending generic erosion in Copaxone,” writes Standard & Poor’s analyst Herman Saftlas.

Acquisitions

Last year, Teva bought German generic drug maker Ratiopharm for $4.97 billion. That helped Teva’s European sales soar 82 percent in the second quarter to $1.5 billion, compared to a year earlier.

“We believe Ratiopharm has significantly enhanced Teva's footprint in the European generic drug market, which should grow faster than the U.S. market over the coming years,” Saftlas writes.

Teva’s $934 million purchase of Japanese drug maker Taiyo Pharmaceutical Industry, completed in July, should increase sales by $250 million in sales in the second half of this year, the company says.

Teva’s net income totaled $984 million in the second quarter, little changed from $981 million a year earlier. Revenue gained 11 percent to $4.2 billion. The company next reports around Nov. 2.

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Teva Pharmaceutical Industries (TEVA) benefits from its status as the world s largest generic drug maker. Its heft gives the Israeli company the ability to both develop drugs of its own and to buy other drug manufacturers. We anticipate over a dozen launches over the...
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2011-20-03
Monday, 03 Oct 2011 03:20 PM
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