Teva lifts forecast as Q3 sales top estimates

Teva reported Wednesday that its revenues were up 7% in the third quarter to reach $3.9 billion, coming in ahead of the $3.7 billion analysts were expecting. The company said revenues reflected sustained growth of its Huntington's disease drug Austedo in North America and the migraine treatment Ajovy globally. Meanwhile, its net income for the three-month period climbed to $80 million, versus $56 million in the year-earlier period.
The generic drugs division posted quarterly sales of nearly $2.2 billion, up almost 10% overall, and coming in ahead of consensus estimates of $2.1 billion. Revenues in the US came in well ahead of expectations, although generics in Europe and internationally were light.
For all of 2023, Teva raised its sales outlook to between $15.1 billion and $15.5 billion, up from between $15 billion and $15.4 billion guided in August. It is maintaining its profit outlook of between $2.25 and $2.55 per share. "In our generics business, we are focusing our portfolio on high-value, complex products and optimising our network," said CEO Richard Francis.
Production 'largely unaffected' by ongoing war
Teva also noted that its production remains "largely unaffected" by the ongoing military conflict between Israel and Hamas. "As a company with deep roots in Israel, we are humbled by the incredible resilience, care and resolve being shown in delivering our medicines to the millions of patients around the world who count on us," commented Francis. A spokesperson noted that more than 92% of the company's production occurs outside of Israel, and sales in the country account for only 2% of Teva's global revenue.
Roughly 300 employees, or about 10% of Teva's Israeli workforce, have been called up into military service through the reserves, according to the CEO. To make up for those losses, some workers are volunteering to take on additional roles, while others are simply producing more, a company spokesperson said.
Evercore ISI analyst Umer Raffat noted that while there was some investor "nervousness" heading into the quarterly results, given questions about manufacturing continuity issues in Israel, the lack of disruption in production and generic results coming in ahead of consensus suggest a very good quarter.
Meanwhile, Teva also announced that its active pharmaceutical ingredients business, known as Teva api, would become a stand-alone unit, with R. Ananthanarayanan appointed to lead the business.