When it comes to pharmaceuticals in Israel, there is no larger name than Teva – but that name may be somewhat tainted following a collection of US-submitted opioid lawsuits filed against the company. At a press gathering on Sunday, the drug giant’s CEO announced that it expects to finalize an opioid settlement in the US by the end of the year and to begin paying in 2023.
The lawsuits against Teva were filed amid a wave of similar suits targeted at over 3,000 opioid manufacturers, distributors and pharmacies which claim that the actors have downplayed their addictive properties and have failed to prevent them from being used illegally.
The pharmaceutical company is finalizing the legal wording this month, and will then seek approval from relevant states and substrate bodies, according to CEO Kare Schultz.
Teva pays up
“By the end of the year, you should have this clarification that it all comes together and we will start paying next year,” Schultz said.
This news broke at Teva’s press event on Sunday, during which the company laid out its strategy and long-term financial targets, as well as highlighted its progress in reaching its 2023 benchmarks.
Covered in a presentation run by Schultz, the company is working diligently to reduce its debt, having already repaid nearly $18 billion of debt to holders, including interest, over the past four years. As a result, the company’s debt now stands at a svelte $20b.
At the same time, Teva is working to reduce its spending, having trimmed its expenditure from $16.3b. in 2017 to $11.5b. in 2021. As well, the company is generating more than $2b. in annual free cash flow (some of which will surely be assigned to the opioid settlements).
The company’s number of manufacturing sites has also been culled, from 80 to 53 in the past four years. By doing so, the company hopes to optimize its business procedures.
Teva also highlighted its near-future projections in the market of biosimilars – drugs that are extremely similar to others that have already been approved by the FDA. Over the next few years, several manufacturers’ exclusivity rights stand to expire, opening the market to freer competition. With a portfolio of 16 biosimilars in hand, Teva expects to do well once this happens.
Teva bets on ESG
Stating explicitly in the company’s press presentation, it also made clear that the principles “ESG [environmental, social, governance] is everyone’s business at Teva,” noting that the company is working to minimize the impact of their operations and products on the planet, promoting diversity and committing to ethics and transparency.
By at least claiming to do so, Teva is putting itself in the same group as a number of Israeli companies who are putting effort into giving back to the world through their business operations.
In an interview with The Jerusalem Post earlier this year, the current trend toward ESG was elaborated upon by Momo Mahadav, CEO of Maala, a nonprofit corporate membership organization promoting corporate social responsibility – a near cousin to ESG principles – in Israel.
“Globally, the amount of funding going toward ESG investments has kind of really soared. In some cases, it’s tripled itself,” Mahadav said. “With climate change being a major concern, asking companies to report on emissions, to report their carbon footprints and even to commit to long-term goals that would allow a kind of real shift in terms of emissions and tackling climate change.”