Teva Pharmaceutical Industries Limited (NYSE:TEVA) Q4 2022 Earnings Call Transcript

Glen Santangelo : Hey, Eli, I just wanted to unpack the revenue guidance a little bit more, if I could. I mean essentially, last quarter, you guided fiscal ’22 revenues of $14.8 billion to $15.4 billion. And now you’re kind of just rolling that same guidance on ’23. And obviously, you’re building in some contributions from the growth in AUSTEDO and some risk-adjusted contributions from UZEDY and Humira. So I was wondering if you could just talk about the offsets to that — to those numbers, to that growth. Will it be the same in ’23 as it was in ’22? Should we expect sort of a similar type of deceleration in the U.S. generics business and a similar type of runoff in COPAXONE? Or is there something else we should be thinking about, for example, like FX playing a bigger role?

Eli Kalif : Okay. Thank you, Glen, for the question. So a few dynamics in that range. First of all, if you look on the midpoint 15.1%, you will see versus ’22 kind of a modest growth, call it like 2% but this is based on a risk adjusted in terms of several launches mostly related with North America. Now if you think about the combination of AUSTEDO, AJOVY and COPAXONE, that’s actually around $70 million higher than how we came in ’22. And we believe that there is still modest opportunities both in AJOVY and AUSTEDO as we’re actually running now the trend on the TRx. And so that’s one element. And then a few other elements really related to our stabilized business in Europe in terms of generics and OTC. We see there also kind of a modest growth, and we live in kind of an environment which is very volatile in terms of FX, and we keep kind of enough spread in order to make sure that we’re capturing any potential rebounding in terms of mostly on the euro appreciation versus ours.

Glen Santangelo : Okay. Maybe if I could just ask one quick follow-up question on the balance sheet. Richard. You sort of seem to suggest that debt reduction remains a primary focus, but how do you think more broadly about the leverage situation, right? Because as Eli sort of talked about in his prepared remarks, right, there’s significant maturities coming up in the next sort of few years that are at or above the level of free cash flow you’re generating now and ultimately, there’s going to be some opioid payments that are going to have to be made. So how do you think about getting that debt down to those sort of 2027 targets, just sort of given the current level of cash flow that you’re generating, how should we think about that over the next couple of years in ’23 in particular?

Richard Francis : Thanks for the follow-on question, Glen. And what I’d say before I hand over to Eli is we think and plan about our debt and repayment of the debt thoroughly and long term. So the way we think about some of the payments we have to pay in ’23, ’24 and ’25, we’ve been working on for some time. So firstly, just to give you that background. And maybe, Eli, if you could go into more specifics about that?