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Teva Pharmaceutical set for major layoffs in Israel, U.S.: report
November 23, 2017 / 9:20 AM / 19 days ago

Teva Pharmaceutical set for major layoffs in Israel, U.S.: report

TEL AVIV (Reuters) - Teva Pharmaceutical Industries is expected to cut 20-25 percent of its workforce in Israel, where it employs 6,860 people, and a few thousand more jobs are to go in the United States, financial news website Calcalist said on Thursday.

FILE PHOTO: The logo of Teva Pharmaceutical Industries, the world's biggest generic drugmaker and Israel's largest company, is seen in Jerusalem February 8, 2017. REUTERS/Ronen Zvulun/File Photo

The world’s largest generic drugmaker will send termination letters to “tens of percents” of its 10,000 employees in the United States in coming weeks, Calcalist said, citing people familiar with the matter.

Teva’s new Chief Executive Kare Schultz is working out the details with regional management in Israel and the United States, Calcalist said, adding that those set to be ousted include its chief scientific officer and president of research and development, Michael Hayden.

A spokesman for Teva declined to comment on the report.

In response to the report, the Histadrut labor federation said it would not accept any unilateral moves by Teva’s management.

“Any efficiency measures, if and when they arise, will be done through negotiations and with the agreement of the Histadrut and the labor unions,” Histadrut spokesman Yaniv Levi said. “Lay-offs are the last resort.”

Teva’s share price was 2.9 percent lower in Tel Aviv at 1343 GMT.

Teva is widely expected to implement a cost-cutting program following the publication of third-quarter results earlier this month.

The company said it would miss 2017 profit forecasts due to falling prices of generics in the U.S. market and weakening sales of its multiple sclerosis drug Copaxone.

Saddled with nearly $35 billion in debt due to its $40.5 billion acquisition of Allergan’s generic drug business Actavis last year, investors have been pushing Teva for clarity on its future.

“It will be an absolute priority for me that we stabilize the company’s operating profit and cash flow in order to improve our financial profile,” Schultz said on a post-earnings call with analysts.

Interim Chief Financial Officer Mike McClellan has said the company was “working on a 2018 plan and evaluating all options”.

Teva has been selling off assets to help meet its debt payments.

Fitch Ratings this month downgraded Teva’s debt to junk.

Reporting by Tova CohenEditing by Jason Neely, Greg Mahlich

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