He feels he is a nation and starts walking This passage from a 1953 poem by Amir Gilboa portrays Theodor Herzl, who envisioned modern-day Israel. A Tel Aviv equity analyst named Ori Hershkovitz used it in a 2010 Harvard Business School case study to describe Eli Hurvitz: “Suddenly he wakes up in the morning, feels he is a giant world class company, and starts walking.”The company is Teva Pharmaceutical Industries. Hurvitz, who died November 21, aged 79, built Teva into the world’s biggest generic medicine company. Teva employs 45,000 people worldwide and supplies one of every six prescriptions issued in the US. Last year Teva produced 63 billion tablets – nine pills for every man, woman and child in the world.Hurvitz literally woke up one morning, spotted an opportunity, and seized it to build the world’s biggest generics firm, operating in 60 countries. As Teva’s Chief Executive Officer (CEO) for over 25 years, and then as its chairman, Hurvitz increased Teva’s revenues from $30 million in 1976 to $16 billion ($3.6b. was before-tax profit) in 2010 – an unprecedented 20 percent annual growth rate. How he did this merits close study by entrepreneurs and business leaders everywhere.Hurvitz was born in Jerusalem, the son of a plasterer. He fought in the 1948 War of Independence when he was just 16. He later studied economics at the Hebrew University’s Tel Aviv Annex. To support himself and his wife, Dalia, during his studies, he worked at Assia Laboratories, managed by Dalia’s father, washing test tubes. Hurvitz rose to a senior management job at Assia and in 1969 acquired a small drug company called Teva. He became CEO of the merged company called Teva Pharmaceutical Industries in 1976, a job he held until April 2002, when he continued as chairman.How did he do it? The key ingredients were vision, discipline, scale, focus and menschlichkeit (the properties of being a mensch, a good human being). The late management guru Peter Drucker once said, “I never predict; I just look out the window and see what’s visible but not yet seen.”In 1984, Hurvitz looked out the window and saw what was visible but unseen by others – a huge business opportunity. The United States Congress had just passed the Hatch-Waxman Act, named after its sponsors Senator Orrin Hatch and Representative Henry Waxman, which encouraged the sale of generic drugs if the manufacturer could prove they were equivalent to the original patented molecules and broke no patents (i.e., after the patents on the original molecules expired).Hurvitz saw a great business potential in generics, when other drug companies saw only a low-margin commodity business, where medicines sold for a tenth or less of their original prices. He also spotted a chance to provide the world with low-cost medicine.From 1984 onwards, Hurvitz focused Teva with laser sharpness on its generic business. We love this business, he liked to say, while other drug companies simply endure it. He doggedly drove Teva’s sharp strategic focus on generics and never let it stray.Teva’s success in generics requires operational discipline. In a business where cost is crucial, operational efficiency is vital. I am told by Teva managers that its plants in Kfar Saba and Jerusalem’s Har Hotzvim are its most cost-efficient of all, despite relatively high Israeli wages.In April 2002, Hurvitz gave up the CEO position and appointed in his place Israel Makov, who had joined Teva in 1995 as head of business development. Makov’s background was mainly in consumer products. Makov knew how he and Hurvitz could expand Teva’s business.
How Eli Hurvitz built Teva
“Suddenly he wakes up in the morning, feels he is a giant world class company, and starts walking.”
He feels he is a nation and starts walking This passage from a 1953 poem by Amir Gilboa portrays Theodor Herzl, who envisioned modern-day Israel. A Tel Aviv equity analyst named Ori Hershkovitz used it in a 2010 Harvard Business School case study to describe Eli Hurvitz: “Suddenly he wakes up in the morning, feels he is a giant world class company, and starts walking.”The company is Teva Pharmaceutical Industries. Hurvitz, who died November 21, aged 79, built Teva into the world’s biggest generic medicine company. Teva employs 45,000 people worldwide and supplies one of every six prescriptions issued in the US. Last year Teva produced 63 billion tablets – nine pills for every man, woman and child in the world.Hurvitz literally woke up one morning, spotted an opportunity, and seized it to build the world’s biggest generics firm, operating in 60 countries. As Teva’s Chief Executive Officer (CEO) for over 25 years, and then as its chairman, Hurvitz increased Teva’s revenues from $30 million in 1976 to $16 billion ($3.6b. was before-tax profit) in 2010 – an unprecedented 20 percent annual growth rate. How he did this merits close study by entrepreneurs and business leaders everywhere.Hurvitz was born in Jerusalem, the son of a plasterer. He fought in the 1948 War of Independence when he was just 16. He later studied economics at the Hebrew University’s Tel Aviv Annex. To support himself and his wife, Dalia, during his studies, he worked at Assia Laboratories, managed by Dalia’s father, washing test tubes. Hurvitz rose to a senior management job at Assia and in 1969 acquired a small drug company called Teva. He became CEO of the merged company called Teva Pharmaceutical Industries in 1976, a job he held until April 2002, when he continued as chairman.How did he do it? The key ingredients were vision, discipline, scale, focus and menschlichkeit (the properties of being a mensch, a good human being). The late management guru Peter Drucker once said, “I never predict; I just look out the window and see what’s visible but not yet seen.”In 1984, Hurvitz looked out the window and saw what was visible but unseen by others – a huge business opportunity. The United States Congress had just passed the Hatch-Waxman Act, named after its sponsors Senator Orrin Hatch and Representative Henry Waxman, which encouraged the sale of generic drugs if the manufacturer could prove they were equivalent to the original patented molecules and broke no patents (i.e., after the patents on the original molecules expired).Hurvitz saw a great business potential in generics, when other drug companies saw only a low-margin commodity business, where medicines sold for a tenth or less of their original prices. He also spotted a chance to provide the world with low-cost medicine.From 1984 onwards, Hurvitz focused Teva with laser sharpness on its generic business. We love this business, he liked to say, while other drug companies simply endure it. He doggedly drove Teva’s sharp strategic focus on generics and never let it stray.Teva’s success in generics requires operational discipline. In a business where cost is crucial, operational efficiency is vital. I am told by Teva managers that its plants in Kfar Saba and Jerusalem’s Har Hotzvim are its most cost-efficient of all, despite relatively high Israeli wages.In April 2002, Hurvitz gave up the CEO position and appointed in his place Israel Makov, who had joined Teva in 1995 as head of business development. Makov’s background was mainly in consumer products. Makov knew how he and Hurvitz could expand Teva’s business.