Teva Pharmaceutical Industries Ltd., the drugmaker whose chief executive officer left yesterday in a dispute with the board, reported third-quarter profit that beat estimates after raising prices on its top-selling product.
Earnings excluding some costs declined 4 percent to $1.07 billion, or $1.27 a share, from $1.1 billion, or $1.28, a year earlier, the Petach Tikva, Israel-based company said in a statement today. Profit beat the average estimate of $1.25 a share from 19 analysts surveyed by Bloomberg.
Revenue for the multiple sclerosis treatment Copaxone climbed 1 percent to $1.05 billion after the company increased prices in the U.S., Teva said. The injected drug faces competition from Biogen Idec Inc.’s oral medicine Tecfidera, and may have generic rivals as early as next year.
Preserving sales of Copaxone now will fall to whoever replaces CEO Jeremy Levin, who left the company because he and the board disagreed on how to restructure the world’s biggest generic-drug maker. Teva may struggle to find a replacement of the same caliber because candidates may be concerned about interference from the board, analysts said.
Teva’s American depositary receipts fell 8.1 percent to close at $37.70 in New York yesterday after Levin’s departure, the biggest drop in more than two years. The ADRs have slumped 42 percent from their peak in 2010 on concern that Copaxone competition would mount, and pressure on the generic-drug business. Trading in Tel Aviv was suspended today.
Sales rose 2 percent to $5.1 billion, beating the average estimate of $4.98 billion.
Biogen boosted its 2013 forecast on Oct. 28 after sales of Tecfidera, which received U.S. approval in March, topped analysts’ third-quarter estimates. Tecfidera now represents more than 10 percent of the MS market, said Leerink Swann’s Marko Kozul.
With the prospect of a decline in Copaxone sales, Teva is seeking to cut 10 percent of its workforce, or about 5,000 jobs, to trim costs. The labor plan met with uproar in Israel and disagreement between Levin and Chairman Phillip Frost on how to execute the cuts, according to Israel’s Channel 2.
Analysts expect sales of Copaxone, which make up about 20 percent of Teva’s revenue and about 50 percent of profit, will fall over the next five years as the relative ease of oral pills lures patients from the older Teva injected product.
Copaxone also faces potential generic competition as early as next year because of a U.S. court decision in July.
Chief Financial Officer Eyal Desheh was named interim CEO while the company searches for Levin’s successor. Desheh is a candidate to get the job permanently, said Amir Elstein, a board member. Erez Vigodman, CEO of chemical company Makhteshim-Agan Industries Ltd. and a Teva board member, probably will get the job, said Ori Hershkovitz, a partner at Sphera Funds Management Ltd. in Tel Aviv.
Teva, in the conference call yesterday announcing Levin’s departure, narrowed its forecast for earnings and sales this year. The company sees profit excluding some costs of $4.95 to $5.05 a share, and sales of $19.7 billion to $20.3 billion. Previously, Teva had forecast $4.85 to $5.15 a share, and revenue of $19.5 billion and $20.5 billion.
Teva will hold a call with analysts at 9 a.m. New York time.