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Teva Rises to 6-Month High on Ranbaxy Market Share, New CEO

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Teva Rises to 6-Month High on Ranbaxy Market Share, New CEO
Teva, the world’s largest generic drugmaker, advanced 3.3 percent to 166 shekels, or the equivalent of $43.16, at 12:56 p.m. in Tel Aviv, the highest since July 14. Photographer: Adam Reynolds/Bloomberg

Jan. 4 (Bloomberg) -- Teva Pharmaceutical Industries Ltd. climbed to the highest in almost six months on reports Ranbaxy Laboratories Ltd. gained Lipitor market share and as analysts applauded the company’s choice of new chief executive officer.

Teva, the world’s largest generic drugmaker, advanced 3.2 percent to 165.90 shekels, or the equivalent of $43.08, at the 4:30 p.m. close in Tel Aviv, the highest since July 14. The U.S.-traded shares led the gains of Israeli stocks traded in New York yesterday, surging 6.8 percent to $43.10. The Bloomberg Israel-US 25 Index of the largest Israeli companies traded in New York gained 4.5 percent, the most since Aug. 9.

Ranbaxy’s weekly prescription market share rose to 26 percent in its third week of marketing the generic version of the $10.7 billion Lipitor cholesterol pill, Uriel Goren, head of international clients desk at DS Securities & Investments Ltd., said in an e-mailed note today. “This together with the new appointment of CEO was viewed positively yesterday by investors in the U.S.,” Goren said.

Jeremy Levin, formerly senior vice president for strategy at Bristol-Myers Squibb Co., will take over as president and CEO in May, Teva said Jan. 2. He has the ability to “refocus and revitalize” the Petach Tikva, Israel-based company, according to RBC Capital Markets LLC’s analyst Shibani Malhotra.

“We expect that Dr. Levin will focus the company towards the areas of greatest opportunities in the future, regardless of whether these exist in the generics or branded business,” Malhotra wrote in an e-mailed report today.

Diversification

Clal Finance Brokerage Ltd. in Tel Aviv estimated on Dec. 20 that the Teva-Ranbaxy partnership’s generic version of Lipitor may capture as much as 20 percent of total sales of the drug.

“The data they have given is very good. They are strengthening their share,” Natali Gotlieb, an analyst at I.B.I.-Israel Brokerage & Investments Ltd. in Tel Aviv, said today. “If the trend continues, it is obviously good.”

Levin may help Teva find new sources of revenue to replace sales lost as the company’s best-selling medicine, the multiple sclerosis treatment Copaxone, faces increasing competition, said Randall Stanicky, an analyst at Canaccord Genuity who rates the shares “buy.”

“This marks a shift in the industry, moving to a more diversified business model which incorporates a greater share of more innovative and branded products,” Stanicky said.

Levin declined to discuss strategy changes and said he will take a “deep dive” into Teva’s drugs and research pipeline on a conference call with analysts on Jan. 3.

At Bristol-Myers, Levin helped oversee partnerships and acquisitions to replace revenue it is expected to lose when the blood thinner Plavix, Bristol-Myers’ top-selling drug, faces generic competition this year.

To contact the reporters on this story: Gwen Ackerman in Jerusalem at gackerman@bloomberg.net; Zachary Tracer in New York at ztracer1@bloomberg.net

To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net

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