Teva (NYSE: TEVA) pivots to growth with biosimilars and CNS focus
Rhea-AI Filing Summary
Teva Pharmaceutical Industries files its Annual Report on Form 10-K, outlining a global biopharmaceutical business built on generics, biosimilars and innovative medicines across three segments: United States, Europe and International Markets.
The company highlights key branded CNS products such as AUSTEDO, AJOVY, UZEDY and COPAXONE, plus oncology and respiratory franchises, while expanding a broad biosimilars portfolio through collaborations with Samsung Bioepis, Formycon, Prestige Biopharma and others. Teva reports a 2025 workforce of 33,950 employees in 57 countries and 1,149,812,898 ordinary shares outstanding as of December 31, 2025.
Management emphasizes its “Pivot to Growth” strategy, including focus on high-value and complex generics, divestiture of the API business, AI-driven efficiency initiatives, and continued network optimization. The filing also details extensive U.S., European and international regulatory frameworks, including the Inflation Reduction Act’s impact on AUSTEDO Medicare pricing from 2027 and Teva’s ongoing legal challenge to aspects of the program.
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Insights
Teva’s 10-K stresses a pivot toward higher-margin innovation and biosimilars under heavy regulatory change.
Teva describes a diversified model: large global generics and OTC operations supporting a growing innovative portfolio in CNS, respiratory and oncology, plus a rapidly expanding biosimilars franchise. Collaborations on products like EPYSQLI, AHZANTIVE and Tuznue signal reliance on partners to scale biologics efficiently.
The “Pivot to Growth” strategy centers on prioritizing innovative assets, complex generics, and divesting the API business, while using AI to streamline R&D, supply chain and forecasting. At the same time, Teva is rationalizing its manufacturing footprint and reducing headcount under Transformation programs to improve cost structure.
Regulatory sections underscore exposure to U.S. policy, especially the Inflation Reduction Act. AUSTEDO’s negotiated Medicare “Maximum Fair Price,” effective
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
400 Interpace Parkway, #3 Parsippany NJ , 07054 USA+ 1-973 -658-0301 |
972( 3) | |
(Address of principal executive offices, zip code and telephone number, including area code) | ||
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered | ||
representing one Ordinary Share |
| ☒ | Accelerated filer | ☐ | ||||
Non-accelerated filer |
☐ | Smaller reporting company | ||||
| Emerging growth company | ||||||
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For an accessible version of this Annual Report on Form 10-K, please visit www.tevapharm.com
TABLE OF CONTENTS
| Page | ||||||
| Introduction and Use of Certain Terms |
1 | |||||
| Cautionary Note Regarding Forward-Looking Statements |
1 | |||||
| PART I | ||||||
| Item 1. |
Business |
3 | ||||
| Item 1A. |
Risk Factors |
28 | ||||
| Item 1B. |
Unresolved Staff Comments |
54 | ||||
| Item 1C. |
Cybersecurity |
54 | ||||
| Item 2. |
Properties |
56 | ||||
| Item 3. |
Legal Proceedings |
56 | ||||
| Item 4. |
Mine Safety Disclosures |
56 | ||||
| PART II | ||||||
| Item 5. |
Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | 57 | ||||
| Item 6. |
[Reserved] |
58 | ||||
| Item 7. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
59 | ||||
| Item 7A. |
Quantitative and Qualitative Disclosures about Market Risk |
85 | ||||
| Item 8. |
Financial Statements and Supplementary Data |
88 | ||||
| Item 9. |
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure |
177 | ||||
| Item 9A. |
Controls and Procedures |
177 | ||||
| Item 9B. |
Other Information |
178 | ||||
| Item 9C. |
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections (Not Applicable) |
178 | ||||
| PART III | ||||||
| Item 10. |
Directors, Executive Officers and Corporate Governance |
178 | ||||
| Item 11. |
Executive Compensation |
178 | ||||
| Item 12. |
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | 178 | ||||
| Item 13. |
Certain Relationships and Related Transactions, and Director Independence |
179 | ||||
| Item 14. |
Principal Accountant Fees and Services |
179 | ||||
| PART IV | ||||||
| Item 15. |
Exhibits, Financial Statement Schedules |
180 | ||||
| Item 16. |
Form 10-K Summary |
185 | ||||
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INTRODUCTION AND USE OF CERTAIN TERMS
Unless otherwise indicated, all references to the “Company,” “we,” “our” and “Teva” refer to Teva Pharmaceutical Industries Limited and its subsidiaries, and references to “revenues” refer to net revenues. References to “U.S. dollars,” “dollars,” “U.S. $” and “$” are to the lawful currency of the United States of America, and references to “NIS” are to new Israeli shekels. References to “ADS(s)” are to Teva’s American Depositary Share(s). Market data, including both sales and share data, is based on information provided by IQVIA, a provider of market research to the pharmaceutical industry (“IQVIA”), unless otherwise stated. References to “R&D” are to Research and Development, references to “IPR&D” are to in-process R&D, references to “S&M” are to Selling and Marketing and references to “G&A” are to General and Administrative. Some amounts in this report may not add up due to rounding. All percentages have been calculated using unrounded amounts. This report on Form 10-K contains many of the trademarks and trade names used by Teva in the United States and internationally to distinguish its products and services. Any third-party trademarks mentioned in this report are the property of their respective owners.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS AND RISK FACTOR SUMMARY
In addition to historical information, this Annual Report on Form 10-K, and the reports and documents incorporated by reference in this Annual Report on Form 10-K, may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which are based on management’s current beliefs and expectations and are subject to substantial risks and uncertainties, both known and unknown, that could cause our future results, performance or achievements to differ significantly from that expressed or implied by such forward-looking statements. These forward-looking statements include statements concerning our plans, strategies, objectives, future performance and financial and operating targets, and any other information that is not historical information. You can identify these forward-looking statements by the use of words such as “should,” “expect,” “anticipate,” “estimate,” “target,” “may,” “project,” “guidance,” “intend,” “plan,” “believe” and other words and terms of similar meaning and expression in connection with any discussion of future operating or financial performance. Important factors that could cause or contribute to such differences include risks relating to:
| • | our ability to successfully compete in the marketplace, including: that we are substantially dependent on our generic products; concentration of our customer base and commercial alliances among our customers; competition faced by our generic medicines from other pharmaceutical companies and changes in regulatory policy that may result in costs and delays; delays in launches of new generic products; our ability to develop and commercialize additional pharmaceutical products in a timely manner; intense competition for our innovative medicines; our ability to achieve expected results from investments in our product pipeline; our ability to successfully execute our Pivot to Growth strategy, including to expand our innovative and biosimilar medicines pipeline and profitably commercialize our innovative medicines and biosimilar portfolio, whether organically or through business development, to sustain and focus our portfolio of generic medicines, and to execute on our organizational transformation and to achieve expected cost savings; and the effectiveness of our patents and other measures to protect our intellectual property rights; |
| • | our significant indebtedness, which may limit our ability to incur additional indebtedness, engage in additional transactions or make new investments; and our potential need to raise additional funds in the future, which may not be available on acceptable terms or at all; |
| • | our business and operations in general, including: the impact of global economic conditions and other macroeconomic developments and the governmental and societal responses thereto, and our exposure to changes in international trade policies, including the imposition of tariffs in the jurisdictions in which we operate, and any effects of such developments on sales of our products and the pricing and availability of raw materials; effectiveness of our optimization efforts; significant disruptions of information technology systems, including cybersecurity attacks, as well as risks and uncertainties |
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| related to the adoption of artificial intelligence technologies, and breaches of our data security; interruptions in our supply chain or problems with internal or third party manufacturing; challenges associated with conducting business globally, including political or economic instability, prolonged government shutdowns, widespread outbreaks of major diseases and major hostilities or acts of terrorism, such as the ongoing conflicts between Russia and Ukraine and in the Middle East; our ability to attract, hire, integrate and retain highly skilled personnel; our ability to successfully bid for suitable acquisition targets or licensing opportunities, or to consummate and integrate acquisitions; and our prospects and opportunities for growth if we sell assets or business units and close or divest plants and facilities, as well as our ability to successfully and cost-effectively consummate such sales and divestitures, including our planned divestiture of our API business; |
| • | compliance, regulatory and litigation matters, including: failure to comply with complex legal and regulatory requirements, the effects of regulatory uncertainty and changes and the results of increased regulatory oversight, including expenditures required to ensure compliance with research, production and quality control regulations and remedial actions taken to address product issues, such as delayed product launches, product recalls, and facility shutdowns; the effects of governmental, regulatory and civil proceedings and litigation which we are, or in the future become, party to; the effects of reforms in healthcare regulation and related reductions in pharmaceutical pricing, reimbursement and coverage, including as a result of the One Big Beautiful Bill signed into law in the U.S. in July 2025 (“OBBBA”), which will likely reduce the number of insured in Medicaid and Health Insurance Exchange markets, which may alter utilization patterns and shift negotiating leverage among payors, U.S. Executive Orders issued in April and May 2025 intended to reduce the prices paid by Americans for prescription medicines, including Most-Favored-Nation pricing; legal and regulatory actions in connection with public concern over the abuse of opioid medications; our ability to timely make payments required under our nationwide opioids settlement agreement and provide our generic version of Narcan® (naloxone hydrochloride nasal spray) in the amounts and at the times required under the terms of such agreement; scrutiny from competition and pricing authorities around the world, including our ability to comply with and operate under our deferred prosecution agreement (“DPA”) with the U.S. Department of Justice (“DOJ”); potential liability for intellectual property right infringement; significant product liability claims; claims brought by regulatory agencies; failure to comply with complex Medicare, Medicaid and other governmental programs’ reporting and payment obligations; compliance with sanctions and trade control laws; environmental risks and changes in governmental, investor and societal responses to climate change and sustainability related issues; |
| • | other financial and economic risks, including: our exposure to currency fluctuations and restrictions as well as credit risks; impairments of our long-lived assets; potential significant increases in tax liabilities; the effect on our overall effective tax rate of the termination or expiration of governmental programs or tax benefits, or of a change in our business; and the impact of any failure to maintain effective internal control over our financial reporting; |
and other factors discussed in this Annual Report on Form 10-K for the year ended December 31, 2025, including in the section captioned “Risk Factors.” Forward-looking statements speak only as of the date on which they are made, and we assume no obligation to update or revise any forward-looking statements or other information contained herein, whether as a result of new information, future events or otherwise. You are cautioned not to put undue reliance on these forward-looking statements.
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PART I
ITEM 1. BUSINESS
Business Overview
We are a biopharmaceutical company, enabled by a world-class generics business. For over 120 years, our commitment to bettering health has never wavered. From innovating in the fields of neuroscience and immunology to providing complex generic medicines, biosimilars and pharmacy brands worldwide, we are dedicated to addressing patients’ needs, now and in the future.
We operate worldwide, with headquarters in Israel and a significant presence in the United States, Europe and many other markets around the world. Today, our global network of capabilities consists of approximately 34,000 employees across 57 markets.
Teva was incorporated in Israel on February 13, 1944 and is the successor to a number of Israeli corporations, the oldest of which was established in 1901.
Our Business Segments
We operate our business through three segments: United States, Europe and International Markets. Each business segment manages our entire product portfolio in its region, including generics, which includes biosimilars and over-the-counter (“OTC”) products, as well as innovative medicines. This structure enables strong alignment and integration between operations, commercial regions, R&D, and our global marketing and portfolio function, optimizing our product lifecycle across therapeutic areas.
In addition to these three segments, we have other activities, primarily the sale of active pharmaceutical ingredients (“API”) to third parties, certain contract manufacturing services, and an out-licensing platform offering a portfolio of products to other pharmaceutical companies through our affiliate Medis.
For information regarding our major customers, see note 19 to our consolidated financial statements.
Below is an overview of our three business segments:
United States Segment
We are one of the leading generic pharmaceutical companies in the United States. We market more than 350 generic prescription products in more than 1,100 dosage strengths, packaging sizes and forms, including oral solid dosage forms, injectable products, inhaled products, liquids, transdermal patches, ointments and creams. Most of our generic sales in the United States are made to retail drug chains, mail order distributors and wholesalers.
Our innovative medicines portfolio in the United States includes our core therapeutic area of central nervous system (“CNS”), with a strong emphasis on neurodegenerative disorders, movement disorders, migraine, neuropsychiatry, and multiple sclerosis (“MS”). We also have innovative medicines in respiratory, oncology and selected other areas.
Our CNS portfolio includes AUSTEDO® and AUSTEDO XR® (deutetrabenazine) tablets for the treatment of neurodegenerative and movement disorders – chorea associated with Huntington’s disease and tardive dyskinesia, AJOVY® (fremanezumab-vfrm) injection for the preventive treatment of migraine in adults and children and adolescent patients aged 6 to 17 years, UZEDY® (risperidone) extended-release injectable suspension for the treatment of schizophrenia in adults and bipolar 1 disorder (BD-1) in adults, and COPAXONE® (glatiramer acetate) injection for the treatment of relapsing forms of MS.
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We maintain a presence in oncology, including innovative, generic and biosimilar medicines, such as TRUXIMA® (rituximab-abbs) injection for intravenous use, our first oncology biosimilar product in the United States for the treatment of Non-Hodgkin’s Lymphoma (“NHL”) and Chronic Lymphocytic Leukemia (“CLL”), and BENDEKA® (bendamustine HCl), which is a liquid, low-volume (50 mL) and short-time 10-minute infusion formulation of bendamustine hydrochloride for the treatment of CLL and indolent B-cell NHL, that we licensed from Eagle Pharmaceuticals, Inc. (“Eagle”).
We maintain a presence in the respiratory business by delivering a range of medicines for the treatment of asthma and chronic obstructive pulmonary disease (“COPD”).
Anda, our distribution business in the United States, distributes generic, biosimilar and innovative medicines, and OTC pharmaceutical products from Teva and various third-party manufacturers, to independent retail pharmacies, pharmacy retail chains, hospitals and physician offices in the United States. Anda is able to compete in the distribution market by maintaining a broad portfolio of products, competitive pricing and delivery throughout the United States.
Europe Segment
Our Europe segment includes the European Union, the United Kingdom and certain other European countries.
Our generics business (including OTC and biosimilars) makes us one of the leading pharmaceutical companies in Europe. We are not substantially dependent on any single country in Europe for our total generic European revenues, which could be affected by pricing reforms or changes in regulations and public policy.
Although the European markets are diverse and highly fragmented, they share many characteristics that allow us to leverage our pan-European presence and broad portfolio.
Our OTC portfolio in Europe includes global brands such as SUDOCREM® as well as local and regional brands such as NasenDuo®, DICLOX FORTE®, OLFEN® Max and FLEGAMINA®.
Our innovative medicines portfolio in Europe focuses on CNS (including migraine) and respiratory therapeutic areas. Our leading products in Europe are AJOVY and COPAXONE. AJOVY was granted EU marketing authorization in 2019 and, as of December 31, 2025, we have launched AJOVY in most European countries. COPAXONE continues to be among the major products for the treatment of MS, although alternative therapies to glatiramer acetate products have been introduced to various European markets. In line with our Pivot to Growth strategy, we are constantly evaluating and optimizing our products portfolio, including through the sale of certain product rights in our Europe segment.
International Markets Segment
Our International Markets segment includes all countries in which we operate other than those in our United States and Europe segments. The International Markets segment covers a substantial portion of the global pharmaceutical industry, including more than 35 countries.
The countries in our International Markets segment include highly regulated, mainly generic markets, such as Canada and Israel, and branded generics-oriented markets, such as Russia and certain Latin America markets. Each market’s strategy is built upon differentiation and addressing the unmet needs of that market. Our integrated sales force enables us to extract synergies across our branded generic, OTC, biosimilars and innovative medicines product offerings and across various channels (e.g., retail, institutional).
On March 31, 2025, we divested our Teva-Takeda business venture in Japan, which included generic products and legacy products. Since the establishment of the business venture and until the completion of its sale,
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Teva held 51% of the outstanding common stock of the business venture. On March 31, 2025, we deconsolidated the business venture from our financial statements. For additional information, see note 2 and note 22 to our consolidated financial statements.
Our innovative medicines portfolio in our International Markets segment focuses on three main areas: CNS (including migraine), respiratory and oncology. We launched AJOVY in certain countries within our International Markets segment, including in Canada, Japan, Australia, Israel, South Korea, Brazil and others. AUSTEDO was launched in China and Israel during 2021 and in Brazil in 2022. In April 2025, AUSTEDO received marketing authorization in South Korea.
Pivot to Growth Strategy
In 2025, we continued to execute on the four key pillars of our “Pivot to Growth” strategy, announced in May 2023. As part of this strategy, in 2025, we entered the strategy’s “Accelerate Growth” phase, during which we focus on growing our innovative portfolio, aligning capital allocation to invest in activities we expect to have the highest value, and modernizing our organization and operations to drive both efficiency and cost savings:
| • | On the first pillar, delivering on our growth engines, we continued to show strong performance of our key innovative products, AUSTEDO, AJOVY, and UZEDY, as well as on our recently launched biosimilars SELARSDITM (ustekinumab-aekn) injection and EPYSQLI® (eculizumab-aagh), and the progress we made on our late-stage pipeline of proposed biosimilars to Prolia®, Xgeva®, Eylea®, and Simponi® and Simponi Aria® which were submitted for regulatory review in the U.S. and the EU; |
| • | On the second pillar, stepping up innovation through delivering on our late-stage innovative pipeline, we continued to accelerate the development of certain key pipeline assets, including with the filing of a New Drug Application (“NDA”) for olanzapine LAI in December 2025. Our investigational therapy emrusolmin (TEV-56286) received U.S. FDA Fast Track designation for the treatment of Multiple System Atrophy (“MSA”); Phase 3 programs for duvakitug (anti-TL1A) in ulcerative colitis and Crohn’s disease were initiated by Sanofi and Teva in October 2025; and by the end of 2025, we achieved the targeted initial enrollment levels in the adult and pediatric populations for DARI’s (Dual-action Asthma Rescue Inhaler) Phase 3 trial; |
| • | On the third pillar, sustaining our generic medicines powerhouse, we remain focused on strengthening our world-class global generics business with a focused portfolio of high-value complex generics and biosimilars, a robust pipeline, and an integrated global manufacturing and commercial footprint. Our recently launched biosimilars continue to grow, as well as our legacy biosimilar portfolio; and |
| • | On the fourth pillar, focusing our business to accelerate growth, we are actively transforming and modernizing our business through Teva Transformation programs. On May 7, 2025, we announced that these programs are expected to generate ~$700 million of net savings through 2027. We have achieved our targeted savings for 2025. |
Artificial Intelligence Initiatives
We are committed to integrating, where appropriate, artificial intelligence (“AI”) technologies in our operations, in an effort to deliver innovative solutions to our customers, patients and stakeholders. Our initiatives include leveraging machine learning and generative AI to optimize internal processes and operations, strengthen risk management, and support product research and development. We selectively apply AI across our value chain where it can drive meaningful value, including for clinical trial planning and management, research and development and drug discovery, manufacturing and supply chain automation, financial forecasting, and customer engagement. These efforts are designed to reduce operational complexity and costs, and unlock new growth opportunities while maintaining a strong focus on responsible and ethical AI practices.
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Our Product Portfolio and Business Offering
Our product and service portfolio includes generic medicines, biosimilar medicines, innovative medicines, OTC products, a distribution business, API and contract manufacturing. Each region manages the entire range of products and services offered in its area, and our generics, innovative, biosimilars and OTC franchise units optimize our pipeline and product lifecycle across therapeutic areas. In most markets in which we operate, we use an integrated and comprehensive marketing model, offering a broad portfolio of products, including generic products, innovative medicines, biosimilars and OTC products. As part of our Pivot to Growth strategy, we intend to divest our API business, in order to focus on our core business strengths and capital allocation towards growth engines and innovation.
Generic Medicines
Generic medicines are the chemical and therapeutic equivalents of originator medicines and are typically more affordable in comparison to the originator’s products. Generic medicines are required to meet similar governmental requirements as their brand-name equivalents, such as those relating to current Good Manufacturing Practices (“cGMP”), manufacturing processes and health authorities’ inspections, and must receive regulatory approval prior to their sale in any given country. Generic medicines may be manufactured and marketed if relevant patents on their brand-name equivalents (and any additional government-mandated market exclusivity periods) have expired or have been challenged or otherwise circumvented.
We develop, manufacture and sell generic medicines in a variety of dosage forms, including tablets, capsules, injectables, inhalants, liquids, transdermal patches, ointments and creams. We offer a broad range of basic chemical entities, as well as specialized product families, such as sterile products, hormones, high-potency drugs and cytotoxic substances, in both parenteral and solid dosage forms. We also offer generic products with medical devices and combination products.
Our generics business has a wide-reaching commercial presence. We have a top three leadership position in many countries, including the United States and some key European markets. We have a robust product portfolio, comprehensive R&D capabilities and product pipeline, and a global operational network, which enables us to execute key generic launches to further expand our product pipeline and diversify our revenue stream. We use these capabilities to mitigate the effect of price erosion on our generics business.
When considering whether to develop a generic medicine, we take into account a number of factors, including regional and local patient and customer needs, our overall strategy, R&D and manufacturing capabilities, regulatory considerations, commercial factors and the intellectual property landscape. We will challenge patents when appropriate, if we believe they are either invalid or would not be infringed by our generic version. We may seek alliances to acquire rights to products we do not have in our portfolio, to share development costs or litigation risks, or to resolve patent and regulatory barriers to entry.
In recent years, including as part of our Pivot to Growth strategy, we have been optimizing our global generics portfolio through product discontinuation and cost-structure improvements, sale of certain product rights, to continue focusing on pipeline optimization and high-value generics, including complex generics. This has resulted in the ongoing network optimization of our generics business, including our manufacturing and supply network, and in the closure or divestment of a significant number of manufacturing plants around the world in recent years.
In markets such as the United States, the United Kingdom, Canada, the Netherlands and Israel, generic medicines may be substituted by the pharmacist for their brand name equivalent or according to their prescribed International Nonproprietary Name (“INN”). In these so-called “pure generic” markets, physicians and patients have little control over the choice of generic manufacturer, and consequently generic medicines are not actively marketed or promoted to physicians or consumers. Instead, the relationship between the manufacturer and
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pharmacy chains, distributors, health funds and other health insurers is critical. Many of these markets have automatic substitution models when generics are available as alternatives to brands. In Russia, Turkey, Ukraine, Kazakhstan and certain Latin American and European countries, generic medicines are generally sold under brand names alongside the originator brand. These markets are referred to as “branded generic” markets and in certain cases are “out of pocket” markets in which consumers can pay for a particular branded generic medicine (as opposed to government or privately funded medical health insurance), often at the recommendation of their physician. Branded generic products are actively promoted and a sales force is necessary to create and maintain brand awareness. Other markets, such as Germany, France, Italy and Spain, are hybrid markets with elements of both approaches.
Our position in the generics market has been supported by our global R&D function, as well as our API R&D and manufacturing activities, which provide vertical integration for many of our products. For information about our product launches and pipeline of generic medicines in the United States and Europe, see “Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations—Segment Information—United States Segment” and “Item 7—Management’s Discussions and Analysis of Financial Condition and Results of Operations—Segment Information—Europe Segment.”
Biologic medicines are large and complex medicines produced by or made from living cells or organisms. Biosimilars are highly similar to the reference biologic, in both structure and function (e.g., pharmacodynamics, pharmacokinetics, safety, efficacy and immunogenicity) and, for any approved uses, have no clinically meaningful differences from the reference product in terms of safety, purity, and potency.
In recent years, we launched the following biosimilar medicines, including under our strategic collaborations: TRUXIMA® (rituximab-abbs) (U.S.: 2019; Canada: 2020), HERZUMA® (trastuzumab-pkrb) (U.S./Canada: 2020), RANIVISIO® (ranibizumab) (EU/UK: 2022; Canada: 2023), SIMLANDI® (adalimumab-ryvk) (U.S.: 2024), SELARSDI (ustekinumab-aekn) (U.S.: 2025), EPYSQLI® (eculizumab-aagh) (U.S.: 2025) and FYMSKINA®(ustekinumab) (Germany: 2025).
Below are some developments in our biosimilars business in 2025, as we make progress in expanding our global biosimilars portfolio and strategic collaborations, and in optimizing our capital resources, in line with our Pivot to Growth strategy:
On January 10, 2025, we announced that we entered into a strategic partnership with Samsung Bioepis for the commercialization of EPYSQLI® (eculizumab), Samsung Bioepis’s biosimilar to Soliris® (eculizumab-aagh) in the U.S., which was available and launched in the U.S. on April 7, 2025, for the treatment of patients with paroxysmal nocturnal hemoglobinuria (PNH), atypical hemolytic uremic syndrome (aHUS) and generalized myasthenia gravis (gMG). Under the terms of the agreement, Samsung Bioepis will be responsible for the development, regulatory registration, manufacture and supply of the product, and Teva will be responsible for commercialization of the product in the U.S.
On January 13, 2025, we announced we entered into a collaboration agreement with Formycon for the commercialization of FYB203, Formycon’s biosimilar candidate to Eylea® (aflibercept) in Europe (excluding Italy), the United Kingdom, Switzerland and in Israel, for the treatment of neovascular age-related macular degeneration (nAMD) and other severe retinal diseases. Under the terms of the agreement, Teva will lead the commercialization of FYB203 in the designated regions, to be marketed under the brand name AHZANTIVE®.
On October 20, 2025, we announced we entered into a collaboration agreement with Prestige Biopharma for the commercialization of Tuznue®, Prestige’s biosimilar to Herceptin® (trastuzumab), across a majority of European markets. Tuznue® is approved in the EU for the treatment of breast cancer and metastatic gastric cancer.
On November 25, 2025, we received European Medicines Agency (“EMA”) approvals for PONLIMSI® (denosumab), our biosimilar to Prolia® and for DEGEVMA® (denosumab), our biosimilar to Xgeva®.
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For information on our biosimilar products pipeline, see “—Research and Development” below.
Innovative Medicines
Our innovative medicines business is focused on delivering innovative solutions to patients and providers via medicines, devices and services in key regions and markets around the world, and includes our core therapeutic area of CNS, with a strong emphasis on neurodegenerative disorders, neuropsychiatry, movement disorders, migraine and MS. We also have innovative medicines in respiratory, oncology and selected other areas.
We deploy medical and sales and marketing professionals within specific therapeutic areas who seek to address the needs of patients and healthcare professionals. We tailor our patient support, payer relations and medical affairs activities to the distinct characteristics of each therapeutic area and medicine.
The U.S. market is the most significant market in our innovative medicines business. In Europe and International Markets, we leverage existing synergies between our innovative medicines business and our generics and OTC businesses.
We have built specialized “Patient Support Programs” in many countries around the world, to help patients adhere to their treatments, improve patient outcomes and, in certain markets, ensure timely delivery of medicines and assist in securing reimbursement. These programs reflect the importance we place on supporting patients and ensuring better medical outcomes for them. We believe that it is important to provide a range of services and solutions tailored to meet the needs of patients according to their specific condition and local market requirements. We believe this capability provides an important competitive advantage in the innovative medicines business.
Below is a description of our key innovative medicines:
CNS (including Movement Disorders and Migraine)
Our CNS portfolio includes AUSTEDO for the treatment of tardive dyskinesia and chorea associated with Huntington’s disease, AJOVY for the preventive treatment of migraine, UZEDY for the treatment of schizophrenia and bipolar 1 disorder, and COPAXONE for the treatment of relapsing forms of MS.
AUSTEDO and AUSTEDO XR
| • | AUSTEDO (deutetrabenazine) tablets are a deuterated form of a small molecule inhibitor of vesicular monoamine 2 transporter, or VMAT2, that is designed to regulate the levels of a specific neurotransmitter, dopamine, in the brain. All regulatory exclusivities for AUSTEDO are now expired. |
| • | AUSTEDO was launched in the U.S. in 2017. It is indicated for the treatment of chorea associated with Huntington’s disease and for the treatment of tardive dyskinesia in adults, which is a debilitating, often irreversible movement disorder caused by certain medications used to treat mental health or gastrointestinal conditions. It is one of only two products approved in the U.S. for tardive dyskinesia. |
| • | During 2025, Teva and the Centers for Medicare and Medicaid Services (“CMS”) negotiated a maximum fair price for AUSTEDO and AUSTEDO XR, based on CMS’s list of prescription medicines selected for price-setting discussions, in which they were originally included. The agreement was announced by CMS in November 2025. The revised prices set by the U.S. Government will become effective January 1, 2027 and will apply to eligible Medicare patients. |
| • | AUSTEDO was launched in China and Israel in 2021 and in Brazil in 2022. In February 2024, we announced a strategic partnership for the marketing and distribution of AUSTEDO in China with |
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| Jiangsu Nhwa Hexin Pharmaceutical Marketing Co., Ltd. In April 2025, AUSTEDO received marketing authorization in South Korea. We continue to evaluate additional submissions in various other markets. In January 2026, AUSTEDO received marketing authorization in the EU for the treatment of tardive dyskinesia. |
| • | AUSTEDO is protected in the United States by 14 Orange Book patents expiring between 2031 and 2038. We received notice letters from two ANDA filers regarding the filing of their ANDAs with paragraph (IV) certifications for certain of the patents listed in the Orange Book for AUSTEDO. In 2022, we reached agreements with Lupin and Aurobindo, respectively, to sell their generic products beginning in April 2033, or earlier under certain circumstances. On March 9, 2022, the U.S. Patent and Trial Appeal Board of the U.S. Patent and Trademark Office declined to institute an IPR filed by Apotex regarding the deutetrabenazine compound patent. Currently, there are no further patent litigations pending regarding AUSTEDO. |
| • | AUSTEDO XR (deutetrabenazine) extended-release tablets was approved by the FDA on February 17, 2023 in three doses of 6, 12 and 24 mg, and became commercially available in the U.S. in May 2023. The FDA approved AUSTEDO XR as a one pill, once-daily treatment option in doses of 30, 36, 42, and 48 mg in May 2024 and in doses of 18 mg in July 2024. AUSTEDO XR is a once-daily formulation indicated in adults for tardive dyskinesia and chorea associated with Huntington’s disease, which is additional to the twice-daily AUSTEDO. AUSTEDO XR is protected by 11 Orange Book patents expiring between 2031 and 2041. |
AJOVY
| • | AJOVY (fremanezumab-vfrm) injection is a fully humanized monoclonal antibody that binds to calcitonin gene-related peptide (“CGRP”). AJOVY was launched in the U.S. in 2018 for the preventive treatment of migraine in adults, and in August 2025, the FDA approved AJOVY for the preventive treatment of episodic migraine in children and adolescent patients aged 6 to 17 years. AJOVY is the only anti-CGRP subcutaneous product indicated for both quarterly and monthly dosing options. AJOVY faces competition from multiple other products. |
| • | During 2019, AJOVY was granted a marketing authorization in the European Union by the EMA in a centralized process and began receiving marketing authorizations in various countries in our International Markets segment. As of today, we launched AJOVY in 48 countries around the world. |
| • | Our auto-injector device for AJOVY became commercially available in the European Union in March 2020, in the U.S. in April 2020 and in Canada in April 2021. |
| • | AJOVY is protected worldwide by patents expiring in 2026 at the earliest; extensions have been granted in several countries, including the United States and in Europe, until 2031. Additional patents relating to the use of AJOVY in the treatment of migraine have also been issued in the United States and in Europe and will expire between 2035 and 2039. Such patents are also pending in other countries. AJOVY will also be protected by regulatory exclusivity for 12 years from marketing approval in the United States (obtained in September 2018) and 10 years from marketing approval in Europe (obtained in April 2019). For our patent litigation related to other anti-CGRP products, see note 12b to our consolidated financial statements. |
UZEDY
| • | UZEDY (risperidone) extended-release injectable suspension was approved by the FDA on April 28, 2023 for the treatment of schizophrenia in adults, and was launched in the U.S. in May 2023. UZEDY is a subcutaneous, long-acting formulation that controls the steady release of risperidone. |
| • | UZEDY is protected by six Orange Book patents expiring between 2027 and 2042. UZEDY is protected by regulatory exclusivity until April 28, 2026. |
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| • | On October 10, 2025, it was announced that the FDA approved UZEDY as a once-monthly extended-release injectable suspension as monotherapy or as adjunctive therapy to lithium or valproate for the maintenance treatment of bipolar 1 disorder (BD-1) in adults. We are evaluating plans to launch UZEDY in other countries around the world. UZEDY faces competition from multiple products. |
COPAXONE
| • | COPAXONE (glatiramer acetate injection) continues to play a role in the treatment of MS in the United States and Europe, although its market share has shown a gradual decline throughout 2025 due to the growing adoption of new treatments. COPAXONE is indicated for the treatment of patients with relapsing forms of MS (“RMS”), including the reduction of the frequency of relapses in relapsing-remitting multiple sclerosis (“RRMS”), in patients who have experienced a first clinical episode and have MRI features consistent with MS. |
| • | COPAXONE is believed to have a unique mechanism of action that works with the immune system, unlike many therapies that are believed to rely on general immune suppression or cell sequestration to exert their effect. COPAXONE provides a proven mix of efficacy, safety and tolerability. |
| • | In certain European countries, Teva remains in litigation against generic companies regarding COPAXONE. |
| • | The market for MS treatments continues to develop, particularly with the approval of alternative therapies and generic versions of COPAXONE. Oral branded and generic treatments for MS, continue to present significant and increasing competition. COPAXONE also continues to face competition from existing injectable products, as well as from monoclonal antibodies. |
Oncology
Our innovative oncology medicines portfolio mainly includes BENDEKA and TREANDA® in the United States.
BENDEKA and TREANDA
| • | BENDEKA (bendamustine hydrochloride) injection and TREANDA (bendamustine hydrochloride) for injection are approved in the United States for the treatment of patients with Chronic Lymphocytic Leukemia (“CLL”) and patients with indolent B-cell Non-Hodgkin’s Lymphoma (“NHL”) that has progressed during or within six months of treatment with rituximab or a rituximab-containing regimen. We launched BENDEKA in the United States in January 2016. It is a liquid, low-volume (50 mL) and short-time (10-minute) infusion formulation of bendamustine hydrochloride that we licensed from Eagle. |
| • | BENDEKA faces direct competition from Belrapzo® (a ready-to-dilute bendamustine hydrochloride product from Eagle) and from Vivimusta® (a bendamustine hydrochloride injection from Azurity Pharmaceuticals). Other competitors to BENDEKA include combination therapies for the treatment of NHL, as well as a combination for the treatment of CLL and newer targeted oral therapies. The orphan drug exclusivity that had attached to bendamustine products expired in December 2022. |
| • | In April 2019, we signed an amendment to the license agreement with Eagle extending the royalty term applicable to the United States to the full period for which we sell BENDEKA and increased the royalty rate. In consideration, Eagle agreed to assume a portion of BENDEKA-related patent litigation expenses. |
| • | There are 20 patents listed in the U.S. Orange Book for BENDEKA with expiration dates in 2026 and 2031. In August 2021, the Court of Appeals for the Federal Circuit affirmed the district court’s decision upholding the validity of all of the asserted patents and finding infringement by two remaining ANDA filers. Another ANDA filer did not join the appeal, and Teva also settled with two ANDA filers. |
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| • | Teva also settled litigation against three 505(b)(2) applicants: Hospira, Inc. (“Hospira”), Dr. Reddy’s Laboratories (“DRL”) and Accord Healthcare (“Accord”). Based on these settlement agreements, Hospira, Accord and DRL can launch their products on November 17, 2027, or earlier under certain circumstances. In 2023, Teva and Eagle also filed suit against BendaRx Corp. in the U.S. District Court for the District of Delaware, following its filing of a 505(b)(2) NDA for a bendamustine product, and that litigation is still pending. Similarly, on September 18, 2025, Teva and Eagle filed suit against Almaject, Inc. and Alvogen, Inc. in the District of Delaware following the filing of another 505(b)(2) NDA for a generic BENDEKA product. |
| • | In addition to the settlement with Eagle regarding its bendamustine 505(b)(2) NDA, between 2015 and 2020, we reached final settlements with 22 ANDA filers for generic versions of the lyophilized form of TREANDA and one 505(b) (2) NDA filer for a generic version of the liquid form of TREANDA, providing for the launch of generic versions of TREANDA prior to patent expiration. Currently, there are multiple generic TREANDA products on the market. |
Respiratory
Our respiratory portfolio includes rescue and maintenance inhalers in treatment classes, that are most commonly used for patients with asthma and COPD. The list of products includes ProAir® RespiClick®, QVAR RediHaler®, BRALTUS®, CINQAIR®/CINQAERO®, DuoResp® Spiromax® and AirDuo® RespiClick®.
| • | QVAR RediHaler (beclomethasone dipropionate HFA) inhalation aerosol, a BAI, is indicated for the maintenance treatment of asthma as a prophylactic therapy in patients four years of age and older. There are no current PIV challenges to the QVAR RediHaler patents. |
| • | BRALTUS (tiotropium bromide) is a long-acting muscarinic antagonist, indicated for adult patients with COPD, delivered via the Zonda inhaler. It was launched in Europe in August 2016. |
| • | CINQAIR/CINQAERO (reslizumab) injection is a humanized interleukin-5 antagonist monoclonal antibody for add-on maintenance treatment of adult patients with severe asthma and with an eosinophilic phenotype. This biologic treatment was launched in the U.S. and in certain European countries in 2016 and in Canada in 2017. |
Our portfolio of inhalers utilizing an innovative multi-dose dry powder inhaler (“MDPI”) platform includes ProAir RespiClick (albuterol sulfate) inhalation powder and AirDuo RespiClick (fluticasone propionate and salmeterol) inhalation powder in the U.S., as well as DuoResp Spiromax (budesonide and formoterol) in Europe.
For information on our innovative medicines pipeline, see “—Research and Development” below.
Other Activities
We have other sources of revenues, primarily the sale of APIs to third parties, certain contract manufacturing services and an out-licensing platform offering a portfolio of products to other pharmaceutical companies through our affiliate Medis.
We produce approximately 350 APIs both for our own use and for sale to third parties, in many therapeutic areas. APIs used in pharmaceutical products are subject to regulatory oversight by health authorities. We utilize a variety of production technologies, including chemical synthesis, semi-synthetic fermentation, enzymatic synthesis, high potency manufacturing, plant extract technology, peptide synthesis, vitamin D derivatives synthesis and steroids. Our advanced technology and expertise in the field of solid state particle technology enable us to meet specifications for particle size distribution, bulk density, specific surface area and polymorphism, as well as other characteristics.
On January 31, 2024, we announced that we intend to divest our API business (including its R&D, manufacturing and commercial activities) through a sale. The intention to divest is in alignment with our Pivot to
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Growth strategy. On November 5, 2025, we announced that exclusive discussions with a selected buyer on the sale have terminated, and that Teva has initiated a renewed sales process, maintaining our strategic intention to divest our API business. However, there can be no assurance regarding the ultimate timing or structure of a potential divestiture or that a divestiture will be agreed or completed at all.
We provide contract manufacturing services related to products divested in connection with the sale of certain business lines, as well as other miscellaneous items. Our other activities are not included in our United States, Europe and International Markets segments described above.
Research and Development
Our R&D activities span the breadth of our business, including innovative medicines, generic medicines (finished goods and API), biosimilars and OTC medicines.
Our R&D activities are concentrated under one global R&D group with overall responsibility for innovative medicines, generic medicines and biosimilars, with a focus on enabling efficiency across our global operations.
Our innovative R&D product pipeline is focused on biologic and small molecule products. Innovative medicines development activities include preclinical assessment (including toxicology, pharmacokinetics, pharmacodynamics and pharmacology studies), clinical development (including pharmacology and the design, execution and analysis of global safety and efficacy trials), as well as regulatory strategy to deliver registration of our pipeline products. We develop novel innovative medicines in our core therapeutic and disease focus areas. We have neuroscience projects in areas such as neuropsychiatry, migraine and movement disorders/neurodegeneration. Our immunology projects include both novel compounds and delivery systems designed to address unmet patient needs.
We develop generic products for our United States, Europe and International Markets segments. Our focus is on high-value generics and complex formulations with complex technologies, which have higher barriers to entry. Generic R&D activities, which are carried out in development centers located around the world, include product formulation, analytical method development, stability testing, management of bioequivalence, bio-analytical studies, other clinical studies and registration of generic drugs in all of the markets where we operate. We also operate several clinics where most of our bioequivalence studies are performed as well as most of our Phase 1 studies for innovative medicines. We have more than 900 generic products in our pre-approved global pipeline, which includes products in all stages of the approval process: pre-submission, post-submission and after tentative approval.
In addition, our generic R&D supports our OTC business in developing OTC products, as well as in overseeing the work performed by contract developers.
Our current R&D capabilities include solid oral dosage forms (such as tablets and capsules), inhalation, semi-solid and liquid formulations (such as ointments and creams), sterile formulations and other dosage forms, and delivery systems, such as matrix systems, special coating systems for sustained release products, orally disintegrating systems, sterile systems, such as vials, syringes, blow-fill-seal systems, long-acting release injectable, transdermal patches, drug device combinations and nasal delivery systems.
We pursue biosimilar pipeline projects in other therapeutic and disease areas that leverage our global R&D and commercial areas of expertise. Biosimilar development activities, such as analytical method development, testing for analytical biosimilarity, pre-clinical work, chemical manufacturing and control, clinical studies and regulatory strategy, are conducted either in Teva’s various global development sites, or through our collaborations and strategic partnerships as mentioned below (see note 2 to our consolidated financial statements).
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Our API R&D specializes in the development of processes and physical compound characterization for the manufacturing of generic and innovative APIs, including intermediates, synthetic and fermentation products both for internal use and for external customers. Our facilities in various locations worldwide include one large development center focusing on synthetic products, three centers with specific expertise specializing in fermentation, semi-synthetic products and high-potency APIs, and a center for oligonucleotides and peptides. Our substantial investment in API R&D generates a steady flow of API products, supporting the timely introduction of generic products to market in compliance with increasing regulatory requirements. The API R&D division also seeks methods to continuously reduce API production costs, enabling us to improve our cost structure. On January 31, 2024, we announced that we intend to divest our API business (including its R&D, manufacturing and commercial activities) through a sale.
In line with our Pivot to Growth strategy, and our focus on internal growth that leverages our R&D capabilities, we have entered into, and expect to pursue, in-licensing, acquisition, collaboration, funding and other strategic opportunities to supplement and expand our existing innovative medicines and biosimilar pipeline (e.g., the transactions with mAbxience, Launch Therapeutics, Alvotech, Modag, Sanofi, Royalty Pharma and Biolojic). In parallel, we evaluate and expand the development scope of our existing R&D pipeline products as well as our existing products for submission in additional markets and additional indications.
Innovative Medicines Pipeline
Below is a description of key products in our innovative medicines pipeline as of January 26, 2026:
| Phase 2 |
Phase 3 |
Submitted for Regulatory Review | ||||
| Neuroscience | olanzapine LAI (TEV-‘749) Schizophrenia (December 2025) | |||||
| Immunology | Anti-IL-15 (TEV-’408) Celiac disease |
Dual Action Asthma |
||||
| emrusolmin(1) (TEV-‘286) Multiple System Atrophy |
duvakitug (anti-TL1A)(3) (TEV-’574) Inflammatory Bowel Disease (October 2025) |
| (1) | In collaboration with Modag. |
| (2) | In collaboration with Launch Therapeutics. |
| (3) | In collaboration with Sanofi. |
Biosimilar Products Pipeline
We have additional biosimilar products in development internally and with our partners that are in various stages of development, including confirmatory clinical trials for biosimilars to Xolair® (omalizumab); to Entyvio® (vedolizumab) and Entyvio® SC (vedolizumab), which are in collaboration with Alvotech for the U.S. market; and TEV-‘333 and TEV-‘316, both in collaboration with mAbxience. Our proposed biosimilar to Prolia® (denosumab) and to Xgeva® (denosumab) were submitted for regulatory review in the U.S. Our proposed biosimilars to Simponi®, Simponi Aria® (golimumab), and Eylea® (aflibercept), which are in collaboration with Alvotech, were submitted for regulatory review in the U.S.
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Operations
We operate our business globally and believe that our global infrastructure provides us with the following capabilities and advantages:
| • | global R&D facilities that enable us to have a focused pipeline of innovative medicines as well as a broad global generic pipeline and product line; |
| • | API manufacturing capabilities that offer a stable, high-quality supply of key APIs, vertically integrated with our pharmaceutical operations, which we intend to divest as mentioned above; |
| • | pharmaceutical manufacturing facilities approved by the FDA, EMA and other regulatory authorities located around the world, which offer a broad range of production technologies and the ability to concentrate production in order to achieve high quality and economies of scale; and |
| • | high-volume, technologically advanced distribution facilities around the world for solid dosage forms, injectable and blow-fill-seal, and which allow us to deliver new products to our customers quickly and efficiently, providing a cost-effective, safe and reliable supply. |
These capabilities provide us with the means to respond on a global scale to a wide range of therapeutic and commercial requirements of patients, customers and healthcare providers.
Pharmaceutical Production
We operate 33 finished dosage and packaging pharmaceutical plants in 21 countries. These plants manufacture solid dosage forms, sterile injectables, liquids, semi-solids, inhalers, transdermal patches and other medicinal products. In 2025, we produced approximately 66 billion tablets and capsules, and approximately 600 million sterile units.
The vast majority of our production capacity of our manufacturing sites is located in North America, Europe, Latin America, India and Israel.
We use several external contract manufacturers to achieve operational and cost benefits. We continue to strengthen our third-party operations unit to strategically work with our supplier base in order to meet cost, supply security and quality targets on a sustainable basis in alignment with our global procurement organization.
Our policy is to maintain multiple supply sources for APIs to appropriately mitigate risk in our supply chain to the extent possible. However, our ability to do so may be limited by regulatory and other requirements.
In recent years, we have closed or divested a significant number of manufacturing plants in the United States, Europe, Israel, Japan and India in connection with a restructuring plan and our ongoing efforts to consolidate our manufacturing and supply network.
Raw Materials for Pharmaceutical Production
In general, we purchase our raw materials and supplies required for the production of our products in the open market. For some products, we purchase such raw materials and supplies from one source (the only source available to us) or a single source (the only approved source among many available to us), thereby requiring us to obtain such raw materials and supplies from that particular source. Where possible, we mitigate our raw material supply risks through inventory management and alternative sourcing strategies. See also “Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations—Macroeconomic Environment.”
We source a portion of our APIs from our own manufacturing facilities. Additional APIs are purchased from suppliers located in Europe, Asia and the Americas. We have in place a supplier audit program to provide assurance that our suppliers meet regulatory expectations and are able to fulfill the requirements of our global operations.
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We currently have 13 API production facilities, producing approximately 350 APIs in various therapeutic areas. Our API intellectual property portfolio includes hundreds of granted patents and pending applications.
We have expertise in a variety of production technologies, including chemical synthesis, semi-synthetic fermentation, enzymatic synthesis, high-potency manufacturing, plant extract technology, peptides synthesis, vitamin D derivatives synthesis and steroids. Our advanced technology and expertise in the field of solid-state particle technology enable us to meet specifications for particle size distribution, bulk density, specific surface area and polymorphism, as well as other characteristics.
Our API facilities are required to comply with applicable cGMP requirements under U.S., European, Japanese and other applicable quality standards. Our API plants are regularly inspected by the FDA, European agencies and other authorities, as applicable. See also “Other Activities” above.
Patents and Other Intellectual Property Rights
We rely on a combination of patents, trademarks, copyrights, trade secrets and other proprietary know-how and regulatory exclusivities, as well as contractual protections, to establish and protect our intellectual property rights. We own or license numerous patents covering our products in the United States and other countries. We have also developed many brand names and own many trademarks covering our products. We consider the overall protection of our intellectual property rights to be of material value and act to protect these rights from infringement. We license or assign certain intellectual property rights to third parties in connection with certain business transactions.
Environment, Health and Safety
We are committed to business practices that promote socially and environmentally responsible economic growth. In 2025, we made significant progress on our sustainability strategy under Teva’s Healthy Future framework.
On Environment, Health and Safety (“EHS”), among other actions in 2025:
| • | continued implementing our global EHS management system across all operations, promoting proactive compliance, establishing global standards, and driving continuous improvement; |
| • | conducted proactive compliance evaluations through self-assessments, internal audits, and external audits, addressing non-conformities via corrective and preventive actions; |
| • | advanced development of EHS leading indicators to strengthen predictive insights and foster high-performance work patterns; |
| • | delivered measurable climate action, including achieving progress toward our 2045 Net Zero commitment, alongside adaptation strategies aligned with international standards; |
| • | enhanced risk management through expansion of site and organizational risk registers and implementation of the Serious Incident and Fatality potential (SIFp) program; and |
| • | promoted product stewardship by conducting environmental risk assessments and supporting antimicrobial resistance initiatives. |
Quality
We are committed to complying with global quality and safety requirements and guidance by developing and manufacturing our products in accordance with Current Good Clinical Practices (cGCP), Current Good Laboratory Practices (cGLP), and Current Good Manufacturing Practices (cGMP), thereby seeking to leverage safety, effectiveness and quality as a competitive advantage. In 2025, we continued our commitment to comply
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with regulatory authorities’ expectations in our manufacturing sites across the globe. We actively engage in discussions with authorities to mitigate potential drug shortages and continue to focus on ensuring our systems and processes are designed to meet current regulatory expectations, are suitable to facilitate intended operations, and sustainable to ensure a reliable supply of quality products globally. Our Quality Management System (QMS) makes quality a priority, and we seek to ensure that quality is embedded in our corporate culture through employee training and is reflected in our daily operations.
Competition
Sales of generic medicines have benefited from increasing awareness and acceptance on the part of healthcare insurers and institutions, consumers, physicians and pharmacists around the world. Factors contributing to this increased awareness are the passage of legislation permitting or encouraging generic substitution and the publication by regulatory authorities of lists of equivalent pharmaceuticals, which provide physicians and pharmacists with generic alternatives. In addition, various government agencies and many private managed care or insurance programs encourage the substitution of brand-name pharmaceuticals with generic products as a cost-savings measure in the purchase of, or reimbursement for, prescription pharmaceuticals.
In the United States, we are subject to competition in the generic drug market from domestic and international generic drug manufacturers and brand-name pharmaceutical companies through introduction of next-generation medicines, authorized generics, existing brand equivalents and manufacturers of therapeutically similar drugs. An increase in FDA approvals for existing generic products is increasing the competition on our base generic products. Price competition from additional generic versions of the same product typically results in margin pressures.
The European market continues to be competitive, especially in terms of pricing, quality standards, customer service and portfolio relevance. We are among a few companies with a pan-European footprint, while most of our European competitors focus on a limited number of selected markets or business lines. Our leadership position in Europe allows us to be a reliable partner to fulfill the needs of patients, physicians, pharmacies, customers and payers.
In our International Markets segment, our global scale and broad portfolio give us a competitive advantage over local competitors, allowing us to optimize our offerings through a combination of high-quality medicines and unique go-to-market approaches. In some markets, we face increased competition with generic companies competing based on pricing, time to market, reputation and customer service.
The biosimilars business is also highly competitive and continues to evolve as intellectual property protections for biological products continue to expire in the United States. While we believe that our biologics knowledge and experience provide us with competitive advantages, we anticipate increased competition in the biosimilar space, also following the lowering of barriers to enter, demonstrated by the recent FDA’s announcement to accelerate biosimilar development. Additional risks related to the commercialization of our prospective biosimilars include the number of competitors, potential for steeper than anticipated price erosion, and intellectual property challenges that may impact timely commercialization. There is also a risk of lower or slower uptake due to various factors that may differ among biosimilars such as competitive practices and level of financial incentives (payer or government).
Our innovative medicines business faces intense competition from both innovative and generic pharmaceutical companies. Our innovative medicines business may continue to be affected by price reforms and changes in the political landscape. See “Regulation” section below. We believe that our primary competitive advantages include our commercial marketing teams, global R&D capabilities and strategic collaborations, the body of scientific evidence substantiating the safety and efficacy of our various medicines, our patient-centric solutions, physician and patient experience with our medicines and our medical capabilities, which are tailored to our product offerings and markets.
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Human Capital Management Section
Our People
Our employees are the heart of our Company. In the highly competitive pharmaceutical industry, it is imperative that we attract, develop and retain top talent on an ongoing basis. This objective supports our Pivot to Growth strategy by enabling Teva to: drive growth through innovation and R&D capabilities, provide reliable supply for patients, and have efficient execution across our global footprint. To do this, we seek to make Teva an inclusive, diverse and safe workplace, with meaningful compensation, benefits and wellbeing programs, and we offer training and leadership development programs that foster career growth.
Oversight
Our Human Resources and Compensation Committee, Compliance Committee and Board of Directors oversee culture and talent at Teva, including human capital strategy and execution in such areas as employee engagement, training and development, recruiting and turnover, leadership development and succession planning. Management regularly updates our Board of Directors on internal metrics in these areas.
Employees
As of December 31, 2025, Teva’s global workforce consisted of 33,950 employees.
As a global company, we have employees in 57 countries around the world, representing a wide range of nationalities. In certain countries, we are party to collective bargaining agreements with certain groups of employees.
The following table presents our workforce headcount by employment type:
| December 31, | ||||||||||||
| 2025 | 2024 | 2023 | ||||||||||
| Full-time |
31,173 | 33,892 | 35,001 | |||||||||
| Part-time |
1,669 | 1,794 | 1,471 | |||||||||
| Contractor |
1,108 | 1,144 | 1,379 | |||||||||
| Total |
33,950 | 36,830 | 37,851 | |||||||||
| Total full-time equivalent |
33,346 | 36,167 | 37,226 | |||||||||
The following table presents our workforce headcount by geographic area (excluding contractors)(1):
| December 31, | ||||||||||||
| 2025 | 2024 | 2023 | ||||||||||
| United States |
4,613 | 5,104 | 5,438 | |||||||||
| Europe |
17,390 | 18,555 | 18,602 | |||||||||
| International Markets (excluding Israel) |
7,768 | 8,707 | 9,047 | |||||||||
| Israel |
3,071 | 3,320 | 3,385 | |||||||||
| Total (excluding contractors) |
32,842 | 35,686 | 36,472 | |||||||||
We monitor our employee turnover on an ongoing basis to inform our understanding of our retention, recruitment and talent engagement.
| 1 | Workforce headcount of employees was adjusted to reflect the change in our segments as of January 1, 2024, with the move of Canada from our North America segment (now referred to as United States segment), to our International Markets segment. |
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Under the Teva Transformation programs announced on May 7, 2025, we expect to achieve cost savings through a variety of initiatives including examining practices and efficiencies in methods of working, reduction in headcount and optimizing external spend. The reduction in workforce headcount in 2025 is a result of these Transformation programs. For additional information, see note 15 to our consolidated financial statements.
Inclusion and Diversity
Teva believes that when people from different viewpoints come together, bringing unique perspectives and experiences, we unlock new ideas, drive innovation and create a positive impact for patients worldwide. Providing opportunities and rewarding performance based on merit, is an important part of how we grow and succeed as an organization. Our inclusive practices help ensure that all individuals we work with are supported and empowered to thrive. Inclusion and diversity is woven into many aspects of our business, also, among other things, in order to advance our Pivot to Growth strategy. At Teva we hold a deep respect for each individual, and we are dedicated to nurturing a culture of dignity, fairness and psychological safety. We know that when our people feel respected, they can realize their full potential and apply their unique skills and talents. This not only strengthens individual growth – it also strengthens our organization, fueling our creativity and innovation as we work to improve the health of all people.
By actively seeking qualified candidates from variety of viewpoints and experiences, we seek to build a broad talent pool that reflects the diversity of the patients we serve and supports our ability to understand patient needs and deliver high-quality medicines and services globally. We provide flexible onboarding and a range of leadership and development programs, helping employees grow and advance in their careers based on their needs.
Health and Safety
The health and safety of our employees is critical to our ability to reliably supply medicines to our patients. Our Environment, Health, Safety and Sustainability (EHS&S) Policy and our global Environment, Health and Safety Management System guide our safety practices across all sites.
Employee Career Growth, Training and Development
We invest in employee career growth and development at Teva. Our talent development programs are aimed to benefit employees individually by providing them with the resources they need to enhance their professional and management abilities, develop leadership skills and achieve their career aspirations, which in turn helps us to remain competitive in our industry.
We maintain a range of learning resources to support employees of all levels in developing skills and contributing to Teva’s strategy. Much of our employee training is in-role, amplified by global online training and locally-tailored training modules to meet different challenges, help gain new leadership and essential skills and promote compliance with our policies. By the end of 2025, we rolled out a talent development system based on AI capabilities to match employee skills with development opportunities across the company to employees globally. Through this system, employees can set professional goals, take recommended and tailored learning courses, expand their network, join cross-organizational projects, and explore open roles and career paths across the organization.
Our Teva Grow program for employees provides development in essential soft skills, success in a global setting and company knowledge. We also provide an extensive catalog of lessons from an online learning platform. For Teva managers, we refreshed our development programs to develop the skills, capabilities and mindset required of managers, taking into account our Pivot to Growth strategy.
We focus on succession planning through global talent review processes that identify and accelerate successors’ readiness to fill senior positions across Teva. In order to measure our success, we track the proportion of positions filled with internal successors and other related statistics.
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Compensation, Benefits and Wellbeing
We provide competitive compensation, health and retirement programs for our employees. We offer variable pay in the form of bonuses and stock-based compensation for eligible employees and have one global annual bonus plan.
In 2025, we continued to focus on employee wellbeing. In addition to having our annual global wellbeing month dedicated to raising awareness of the importance of wellbeing, we leveraged practical tools and local programs to address the physical, financial, social and mental health needs of our employees and their families. We offer programs and initiatives that promote healthy nutrition, physical activity and mental wellbeing. For example, our organizations in many countries introduced or expanded employee assistance programs to cover psychological support and counseling for employees and their families. In addition, in the U.S., we leverage a preventative medicine application. This application fuses AI technology with medical protocols and expertise to provide employees with health check-ups adapted to their age, health plan, location, risk factors and personal history.
Employee Engagement and Satisfaction
We have been monitoring employee morale in many ways, including by conducting our annual employee survey. In 2025, we achieved an 83% response rate. Results of the survey show that employee satisfaction across the survey dimensions have generally remained stable. Employees reported feeling connected with Teva’s purpose and values, confident in Teva’s positive impact on society, and believing they are treated with respect. In addition, they reported feeling they are able to be themselves at work, they are treated fairly regardless of personal background or characteristics, and that Teva promotes a culture of diversity and inclusiveness.
Management reviews the survey results closely to determine areas for improvement and creates action plans to address any gaps. Survey results are communicated to employees though global communications and town halls and shared with our Board of Directors.
Regulation
United States
Food and Drug Administration and the Drug Enforcement Administration
All pharmaceutical manufacturers selling products in the United States are subject to extensive regulation by the United States federal government, principally by the Food and Drug Administration (“FDA”) and the Drug Enforcement Administration (“DEA”), and, to a lesser extent, by state and local governments. The Federal Food, Drug, and Cosmetic Act (“FDCA”), the Controlled Substances Act (“CSA”) and other federal and state statutes and regulations govern or influence the development, manufacture, testing, safety, efficacy, labeling, approval, storage, distribution, recordkeeping, advertising, promotion, sale, import and export of our products. Our facilities are periodically inspected by the FDA, which has extensive enforcement powers over the activities of pharmaceutical manufacturers. Noncompliance with applicable requirements may result in fines, criminal penalties, civil injunction against shipment of products, recall and seizure of products, total or partial suspension of production, sale or import of products, refusal of the government to enter into supply contracts or to approve New Drug Applications (“NDAs”), Abbreviated New Drug Applications (“ANDAs”) or Biologics License Application (“BLAs”) and criminal prosecution by the U.S. Department of Justice (“DOJ”). The FDA also has the authority to deny or revoke approvals of marketing applications and the power to halt the operations of non-complying manufacturers. Any failure to comply with applicable FDA policies and regulations could have a material adverse effect on our operations.
FDA approval is required before any “new drug” (including generic versions of previously approved drugs) may be marketed, including new strengths, dosage forms and formulations of previously approved drugs.
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Applications for FDA approval must contain information relating to bioequivalence (for generics), safety, toxicity and efficacy (for new drugs), product formulation, raw material suppliers, stability, manufacturing processes, packaging, labeling and quality control. FDA procedures generally require that commercial manufacturing equipment be used to produce test batches for FDA approval. The FDA also requires validation of manufacturing processes so that a company may market new products. The FDA conducts pre-approval and post-approval reviews and plant inspections to ensure compliance with regulatory standards and to verify the quality and safety of products.
The federal CSA and its implementing regulations establish a closed system and highly regulated system that limits the handling and distribution of controlled substances. The CSA imposes registration, security, recordkeeping and reporting, storage, manufacturing, distribution, importation and other requirements upon legitimate handlers of controlled substances under the oversight of the DEA. The DEA categorizes drugs, substances, and certain chemicals used to make drugs into one of five schedules—Schedule I, II, III, IV, or V —depending on the drug’s acceptable medical use and the abuse or dependency potential. Facilities that manufacture, distribute, conduct chemical analysis, import or export any controlled substance must register annually with the DEA. The DEA performs an inspection of all entities requesting a DEA registration prior to issuing a controlled substance registration for review of the facility and material security, material handling procedures, record keeping, and reporting procedures. The DEA also performs cyclical inspections of all DEA registrants to review accountability, record keeping, and security. Failure to maintain compliance with applicable requirements, particularly as manifested in the loss or diversion of controlled substances, can result in enforcement actions, civil penalties, refusal to renew necessary registrations or the initiation of proceedings to revoke those registrations. In certain circumstances, violations could lead to criminal prosecution.
The Drug Price Competition and Patent Term Restoration Act of 1984 (the “Hatch-Waxman Act”) established the procedures for obtaining FDA approval for generic drug products. This act also provides market exclusivity provisions that can delay the approval of certain NDAs and ANDAs. One such provision allows a five-year period of data exclusivity for NDAs containing new chemical entities and a three-year period of market exclusivity for NDAs (including different dosage forms) containing new clinical trial(s) essential to the approval of the application. The Orphan Drug Act grants seven years of exclusive marketing rights to a specific drug for treatment of a rare disease or condition. The FDCA defines “rare disease or condition” as one that either affects fewer than 200,000 people in the U.S., or for which a manufacturer has no reasonable expectation of recovering drug treatment research and development costs. Market exclusivity provisions are distinct from patent protections and apply equally to patented and non-patented drug products. Another provision of the Hatch-Waxman Act extends certain patents for up to five years due to the time spent in clinical trials and the FDA review process.
Under the Hatch-Waxman Act, any company submitting an ANDA or an NDA under Section 505(b)(2) of the FDCA (i.e., an NDA that, similar to an ANDA, relies, in whole or in part, on FDA’s prior approval of another company’s drug product; also known as a “505(b)(2) application”) must make certain certifications with respect to the patent status of the drug for which it is seeking approval. In the event that such applicant plans to challenge the validity or enforceability of an existing listed patent or asserts that the proposed product does not infringe an existing listed patent, it files a “Paragraph IV” certification. In the case of ANDAs, the Hatch-Waxman Act provides for a potential 180-day period of generic exclusivity for the first company to file a “substantially complete” ANDA with a Paragraph IV certification. This filing triggers a regulatory process in which the FDA is required to delay the final approval of subsequently filed ANDAs containing Paragraph IV certifications until 180 days after the first commercial marketing. For both ANDAs and 505(b)(2) applications, when litigation is brought by the patent holder, in response to this Paragraph IV certification, the FDA generally may not approve the ANDA or 505(b)(2) application until the earlier of 30 months or a court decision finding the patent invalid, not infringed or unenforceable. Submission of an ANDA or a 505(b)(2) application with a Paragraph IV certification can result in protracted and expensive patent litigation.
Products manufactured outside the United States and marketed in the United States are subject to all of the above regulations, as well as to FDA, DEA and U.S. customs regulations at the port of entry. Products marketed
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outside the United States that are manufactured in the United States are additionally subject to various export statutes and regulations, as well as regulation by the country in which the products are to be sold.
Our products also include biopharmaceutical products that are comparable to brand-name biologics, as well as products that are approved as biosimilar versions of brand-name biological products. While regulations are still being developed by the FDA relating to the Biologics Price Competition and Innovation Act of 2009 (“BCPIA”), which created a statutory pathway for the approval of biosimilar versions of brand-name biological products. The BPCIA authorizes the FDA to approve “abbreviated” BLAs for products whose sponsors demonstrate biosimilarity to reference products previously approved under BLAs. Biosimilarity to an approved reference product requires, among other things, that there are no differences in route of administration, dosage, form and strength and conditions of use. The FDA may also separately determine whether biosimilar products are interchangeable with their reference products. To be interchangeable, a biosimilar product must have the same clinical result as the reference product. The BPCIA provides a framework for addressing potential patent infringement disputes. The FDA has issued multiple guidance documents to provide a roadmap for demonstrating the interchangeability and development of biosimilar products.
In September 2022, the FDA User Fee Reauthorization Act of 2022 (“FUFRA”) was enacted in the United States. The FUFRA authorizes the FDA to collect user fees from parties that submit drug, biosimilar or medical device product applications for review or that are named in approved applications as the sponsor of certain products through FDA fiscal year 2027. These fees are used by the FDA to support the product review process at the agency. Various fees must be paid by these manufacturers at different times, such as annually and with the submission of different types of applications. In return for this additional funding, the FDA has entered into agreements with each of the affected industries (known as the “user fee agreements”) that commit the agency to interacting with manufacturers and reviewing applications such as NDAs, ANDAs and BLAs in certain ways, and taking action on those applications at certain times. The agency is obligated to set specific timelines to communicate with companies, meet with company product sponsors during the review process and take action on their applications.
The overall regulatory environment with respect to pharmaceutical advertising remains highly uncertain and increasingly complex. Recent regulatory activity has focused on tightening oversight of pharmaceutical advertising. On September 9, 2025, the Administration, led by HHS and the FDA, announced a new initiative to address direct-to-consumer (DTC) advertising. Following the announcement, the FDA issued regulatory correspondence to certain pharmaceutical manufacturers regarding DTC compliance. The Company received two such letters, responded within the timeframe set out by FDA, and is actively monitoring these developments.
The Inflation Reduction Act and Certain Government Programs
The Inflation Reduction Act (“IRA”) of 2022 was signed into law in August 2022. The IRA restructures Medicare’s benefit design and requires manufacturers of certain drugs to engage in price setting discussions with Medicare, imposes rebates and discount requirements under Medicare Part B and Medicare Part D, and replaces the Part D coverage gap discount program with a new discounting program. In particular, the U.S. Department of Health and Human Services (“HHS”) is directed to select a subset of medicines with the highest annual expenditures to Medicare Parts B and D that have been on the market for 9 years (or 13 years for biologics) without an available generic (or biosimilar) on the market. Drugs with an available generic or biosimilar, certain drugs that represent a limited portion of Medicare program spending, drugs with an orphan designation as their only FDA approved indication, and all plasma-derived products are exempt from the process. The law allows HHS to levy an excise tax and civil monetary penalties against non-compliant manufacturers or those who refuse to participate in the process. The CMS selected 10 Part D drugs for the first round in August 2024 which became effective January 1, 2026. The second set of 15 Part D drugs selected by CMS was announced by CMS on January 17, 2025, which list included Teva’s AUSTEDO and AUSTEDO XR. During 2025, Teva and the Centers for Medicare and Medicaid Services (“CMS”) negotiated a maximum fair price for the AUSTEDO
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products. On November 25, 2025, CMS announced the negotiated ‘Maximum Fair Price’ for the products, which is scheduled to become effective on January 1, 2027 and will apply to eligible Medicare patients.
The IRA also imposes rebate requirements on manufacturers of single-source generics and other drugs covered under Medicare Part B and Part D where the price increases of the drug outpace inflation. Multisource generics and all products with an average manufacturer’s price less than $100 per year, per individual, are exempt from these inflationary rebate requirements. The CMS will monitor for products with price increases higher than the rate of inflation on a quarterly basis. Rebates will be calculated as the total number of units sold multiplied by the amount the product exceeds the inflation-adjusted price, with 2021 as the base year to measure cumulative changes relative to inflation. Noncompliant manufacturers will be subject to a civil monetary penalty of at least 125% of the calculated rebate amount.
The drug price-setting program is currently subject to legal challenges, including by Teva. On January 15, 2025, Teva filed a lawsuit against CMS in the U.S. District Court for the District of Columbia, alleging that CMS’s implementation of the Drug Price Negotiation Program portion of the IRA is arbitrary and contrary to the plain meaning of the statute, in violation of the Administrative Procedure Act (“APA”), and is therefore unconstitutional. On November 20, 2025, the U.S. District Court for the District of Columbia granted CMS’s motion for summary judgment. Teva is appealing that decision.
The CMS administers the Medicaid drug rebate program, in which pharmaceutical manufacturers pay quarterly rebates to each state Medicaid agency. Generally, for generic drugs marketed under ANDAs, manufacturers (including Teva) are required to rebate 13% of the average manufacturer price, and for products marketed under NDAs or BLAs, manufacturers are required to rebate the greater of 23.1% of the average manufacturer price or the difference between such price and the commercial best price during a specified period. An additional rebate for products marketed under ANDAs, NDAs or BLAs is payable if the average manufacturer price increases at a rate higher than inflation and other methodologies apply to new formulations of existing drugs.
The Health Resources and Services Administration (“HRSA”) administers the Public Health Service’s 340B drug pricing program (the “340B program”). Ongoing and future 340B policy changes may create additional uncertainty for Teva. These may include changes to the level of scrutiny applied by HRSA to enforce any perceived 340B program noncompliance or impose restrictions on manufacturers as to how manufacturers administer their 340B pricing, and what requirements manufacturers can impose on 340B covered entities. Some regulatory restrictions by HRSA are currently subject to legal challenges and may undergo regulatory updates following administration changes or court decisions. Beginning January 1, 2026, drug manufacturers in the first round of Medicare price negotiations may participate in an HRSA pilot program that replaces upfront 340B discounts with retroactive rebates. HRSA may later allow manufacturers in the second round of negotiations to join the program as well. Additionally, state legislators may also enact laws and regulations that restrict how manufacturers administer their 340B pricing and the requirements manufacturers may impose on 340B covered entities. Some states have already enacted such laws and regulations, which are currently subject to legal challenges.
All state Medicaid programs have implemented voluntary supplemental drug rebate programs that may provide states with additional manufacturer rebates in exchange for preferred status on a state’s formulary or for patient populations that are not included in the traditional Medicaid drug benefit coverage. In addition, a number of states, including New York, have enacted legislation that requires entities to pay assessments or taxes on the sale or distribution of opioid medications in order to address the misuse of prescription opioid medications. Finally, a number of states have established Prescription Drug Affordability Boards or similar review boards and implemented IRA-like price controls on pharmaceutical manufacturers. These proposals create new authorities for state regulatory bodies to control prices and/or limit reimbursement for certain drugs. Such efforts may expand to additional states.
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On May 12, 2025, the U.S. Administration directed federal government agencies to pursue most-favored-nation price targets with pharmaceutical manufacturers through an Executive Order titled “Delivering Most-Favored-Nation Prescription Drug Pricing to American Patients.” On July 31, 2025, the Administration followed this Executive Order with letters to seventeen manufacturers (but not to the Company) requesting lower existing prescription drug prices in Medicaid, and to guarantee lower pricing for newly-launched drugs for Medicare, Medicaid, and commercial payers to match the lowest price offered in other developed nations. Starting in late September 2025, some drug manufacturers have announced agreements with the federal government to offer most-favored-nation pricing on certain existing and future products. On November 6, 2025, CMS announced the availability of the “Generating Cost Reductions for U.S. Medicaid (GENEROUS) Model,” a limited duration payment model conducted through the CMS Innovation Center to allow drug manufacturers to voluntarily provide coordinated supplemental rebates to state Medicaid agencies that match international prices in a basket of developed market countries. Failure to participate in the model could result in less favorable Medicaid coverage against competitors that choose to participate.
On December 19, 2025, CMS issued two additional notices of proposed rulemaking to establish mandatory, limited duration Medicare drug pricing models known as the “Global Benchmark for Efficient Drug Pricing (GLOBE) Model” for certain Medicare Part B drugs and the “Guarding U.S. Medicare Against Rising Drug Costs (GUARD) Model” for certain Medicare Part D drugs. Under these proposals, CMS would replace existing domestic inflation-based rebate calculations with new rebate obligations tied to international reference pricing benchmarks in a basket of economically comparable countries. If finalized, the models could require the Company to pay additional rebates for certain of its products, depending on CMS selection criteria and international price levels.
Teva is monitoring these developments and assessing the impact it may have on its business.
Other U.S. Healthcare Laws and Compliance Requirements
In the United States, our current and future operations are subject to regulation by various federal, state and local authorities in addition to the FDA, including but not limited to, CMS, other divisions of the HHS, (e.g., the Office of Inspector General (“OIG”), Office for Civil Rights (“OCR”) and the Health Resources and Service Administration (“HRSA”)), the DOJ, and individual U.S. Attorney offices within the DOJ, and state and local governments. For example, our business practices, including our contractual arrangements and any future sales, marketing and scientific or educational grant programs may be required to comply with federal fraud and abuse laws, transparency requirements, and similar state laws, each as amended, as applicable. Such laws include, without limitation, state and federal fraud and abuse laws, including the federal Antikickback Statute (“AKS”), federal False Claims Act (“FCA”), and transparency laws and regulations related to drug pricing and payments and other transfers of value made to physicians and other healthcare providers.
If our operations are found to be in violation of any such laws or any other governmental regulations that apply, we may be subject to penalties, including, without limitation, administrative, civil and criminal penalties, damages, fines, disgorgement, integrity oversight and reporting obligations, exclusion from participation in federal and state healthcare programs and responsible individuals may be subject to imprisonment. The civil monetary penalties statute imposes penalties against any person or entity who, among other things, is determined to have presented or caused to be presented a claim to, among others, a federal healthcare program that the person knows or should know is for a medical or other item or service that was not provided as claimed or is false or fraudulent.
Additionally, the federal Physician Payments Sunshine Act (the “Sunshine Act”), and its implementing regulations, require that certain manufacturers of drugs, devices, biological and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) report information related to certain payments or other transfers of value made or distributed to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), certain non-physician practitioners (such as physician assistants and nurse practitioners), and teaching hospitals, or to
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entities or individuals at the request of, or designated on behalf of, the physicians and teaching hospitals and to report annually to CMS certain ownership and investment interests held by physicians and their immediate family members. Failure to report accurately could result in penalties. In addition, many states also govern the reporting of payments or other transfers of value, many which differ from each other in significant ways, are often not pre-empted, and may have a more prohibitive effect than the Sunshine Act, thus further complicating compliance efforts.
Europe
General
In Europe, marketing authorizations for pharmaceutical products may be obtained either through a centralized procedure for a license valid in all member countries of the European Union, which is granted by the EMA, or through national procedures granted by the national competent authorities via a mutual recognition procedure which requires submission of applications in other chosen member states following approval by a so-called reference member state, a decentralized procedure that entails simultaneous submission of applications to chosen member states or occasionally through a local national procedure.
During 2025, we continued to register products in the European Union, primarily using the decentralized procedure (simultaneous submission of applications to chosen member states). We continue to use, on occasion, the mutual recognition and centralized procedures.
The European pharmaceutical industry is highly regulated and much of the legislative and regulatory framework is driven by the European Commission, together with the European Parliament and the Council of Europe. This has many benefits, including the potential to harmonize standards across the complex European market, but it also has the potential to create complexities affecting the entire European market.
European Union
The medicines regulatory framework of the European Union requires that medicinal products, including generic versions of previously approved products and new strengths, dosage forms and formulations of previously approved products, receive a marketing authorization before they can be placed on the market in the European Union. Authorizations are granted after a favorable assessment of quality, safety and efficacy by the respective health authorities. To comply with formal requirements, the application must contain the quality related information of the product (chemical, physical, biological and microbiological data, information about manufacturing process, raw materials, packaging and labelling data, quality control procedures), data confirming product safety (toxicological and pharmacological information), and product efficacy information (clinical studies or clinical trials).
In order to control expenditures on pharmaceuticals, most member states of the European Union regulate the pricing of such products and in some cases limit the range of different forms of a drug available for prescription by national health services. These controls can result in considerable price differences among member states.
In addition to patent protection, exclusivity provisions in the European Union may prevent companies from applying for marketing approval for a generic product for eight years (or 10 years for orphan medicinal products) from the date of the first marketing authorization of the original product in the European Union. Further, the generic product will be barred from market entry (marketing exclusivity) for a further two years, with the possibility of extending the market exclusivity by one additional year under certain circumstances. As part of the European Commission’s review of the general pharmaceutical legislation, the provisions relating to regulatory exclusivity are currently under review. Proposed changes have been published in 2023 and amendments are being discussed. The final amendments are expected in 2026, although the transitional provisions remain unclear.
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The term of certain pharmaceutical patents may be extended in the European Union by up to five years upon grant of Supplementary Protection Certificates (“SPC”). The purpose of this extension is to increase effective patent life (i.e., the period between grant of a marketing authorization and patent expiration) to 15 years.
Subject to the respective pediatric regulation, the holder of an SPC may obtain a further patent term extension of up to six months under certain conditions. This six-month period cannot be claimed if the license holder claims a one-year extension of the period of marketing exclusivity based on the grounds that a new pediatric indication brings a significant clinical benefit in comparison with other existing therapies.
In July 2019, the SPC Manufacturing Waiver Regulation came into force in the European Union (subject to certain conditions) allowing products manufactured prior to SPC expiration to be exempt from SPC infringement if such products are manufactured for export to non-European Union markets or (no earlier than six months before SPC expiry) for launch in the European Union upon expiration of the SPC. This waiver applies from July 2, 2022 to all SPCs that came into effect after July 1, 2019 or, if the SPC was applied for after July 1, 2019, from the date the SPC comes into effect. This legislation was due to be reviewed prior to July 2024, but the review has been delayed.
Orphan designated products, which receive, under certain conditions, a blanket period of 10 years of market exclusivity, may receive an additional two years of exclusivity instead of an extension of the SPC if the requirements of the pediatric regulation are met. The criteria and protection period for orphan designated products are currently under review by the European Commission, as part of the review of the general pharmaceutical legislation referred to above.
The legislation also allows for R&D work during the patent and SPC term for the purpose of developing and submitting registration dossiers.
In November 2020, the European Commission published a “Pharmaceutical Strategy for Europe,” which sets out a suite of policies that will shape the future European regulatory environment. In late 2025, the European Union institutions reached a political agreement on the comprehensive revision of the pharmaceutical legislation. The agreed framework is intended to foster innovation and enhance access, availability of medicines within the EU, while streamlining regulatory requirements. Formal adoption of the legislation is anticipated in 2026, after which a transition period will apply prior to full implementation.
On June 1, 2023, the Unified Patent Court (“UPC”) Agreement and the unitary patent regulations entered into force. The UPC is a new European court with jurisdiction over disputes relating to European patents and currently covers 18 European Union participating Member States. During an initial transitional period ending in 2030 (which may be extended to 2037), both the UPC and national courts have jurisdiction over infringement or invalidity actions relating to European patents, unless the patentee has opted-out the patent from the jurisdiction of the UPC. After the transitional period, the UPC will have exclusive competence for disputes relating to European patents, without a possibility to opt-out. The unitary patent regulations introduced a new option for applicants at the European patent office to request the grant of a European patent with unitary effect over the 18 European Union participating Member States (instead of the traditional combination of national designations).
United Kingdom
The United Kingdom regulates medicines and medical devices independently from the European Union. The United Kingdom’s Medicines and Healthcare Products Regulatory Agency (“MHRA”) handles the approval process and regulatory compliance requirements for products supplied to United Kingdom patients, the MHRA’s regulatory process still generally follows those of the EMA. We continue to have processes in place in the United Kingdom that are separate from the EMA, which maintain our ability to supply medicines to patients in the United Kingdom and to supply medicines made in the United Kingdom to other markets.
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Medical Devices
Although not subject to FDA regulation as standalone medical devices, certain of our products are regulated as medical devices in the European Union under the European Union Medical Device Regulation (“EU MDR”). The EU MDR specifies risk classification rules and rules related to clinical studies, post-marketing surveillance, device traceability and oversight by notified bodies. In the UK, the previous EU legislation, as adopted into UK law, remains applicable to a large extent. However, the government has announced proposals to progressively reform the regime for medical devices, with new requirements for post-market surveillance of medical devices becoming effective in June 2025 and further changes planned for the next few years.
International Markets
In addition to regulations in the United States and Europe, we, and our partners, are subject to a variety of regulations in other jurisdictions governing, among other things, clinical trials and any commercial sales, marketing and distribution of our products. Such regulations may be similar or, in some cases, more stringent than those applicable in the United States and Europe.
Whether or not we, or our partners, obtain FDA approval for a product, we must obtain the requisite approvals from regulatory authorities in foreign countries prior to the commencement of clinical trials or marketing of such product in those countries. The requirements and processes governing the conduct of clinical trials, product licensing, pricing and reimbursement vary from country to country. In addition, we, and our partners, may be subject to foreign laws and regulations and other compliance requirements, including, without limitation, anti-kickback laws, false claims laws and other fraud and abuse laws, as well as laws and regulations requiring transparency of pricing and marketing information and governing the privacy and security of personal information. The majority of the countries in which we market our products have enacted and/or amended privacy regulation.
If we, or our partners, fail to comply with applicable foreign regulatory requirements, we may be subject to, among other things, fines, suspension or withdrawal of regulatory approvals, product recalls, seizure of products, operating restrictions and criminal prosecution.
Miscellaneous Regulatory Matters
We are subject to various national, regional and local laws of general applicability, such as laws regulating working conditions. We are also subject to country specific data protection laws and regulations applicable to the collection and processing of personal data around the world. In addition, we are subject to various national, regional and local environmental protection laws and regulations, including those governing sustainability related matters, such as mandatory reporting and due diligence obligations. We are also subject to various national, regional and local laws regulating how we interact with healthcare professionals and representatives of government that impact our promotional and other commercial activities. Additionally, we may be subject to various new national, regional and local laws and regulations, such as the NIS2 Directive, the Cyber Resilience Act, the Digital Services Act, the Data Act, the Data Governance Act, the California Climate Corporate Date Accountability Act, the California Climate-Related Financial Risk Act, the EU’s Directive No. 2464/2022 on Corporate Sustainability Reporting (“CSRD”), the European Health Data Space or the revision of the European Pharmaceutical Legislation (not agreed yet), which could impact our business activities and processes. Many countries outside the EU have enacted cybersecurity laws, which laws may relate to Teva depending on the circumstances.
Data exclusivity provisions exist in many countries around the world and may be introduced in additional countries in the future, although their application is not uniform. In general, these exclusivity provisions prevent the approval and/or submission of generic drug applications to the health authorities for a fixed period of time following the first approval of the brand-name product in that country. As these exclusivity provisions operate independently of patent exclusivity, they may prevent the submission of generic drug applications for some products even after the patent protection has expired.
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As a result “Schrems II”, which invalidated the adequacy of the EU-US Privacy Shield Certification Programme under the EU General Data Protection Regulation (“GDPR”), companies are required to conduct and document comprehensive data transfer assessments, and if supplementary measures cannot address an adequate level of protection, then such transfers shall be restricted. In July 2023, the European Commission determined that the Data Privacy Framework (“DPF”), a replacement for the invalidated EU-US Privacy Shield, ensures an adequate level of protection for EU personal data transferred to the United States. Today, many other countries outside the EU are also implementing their own personal data transfer framework, and as such we continue to monitor global developments to address requirements regarding international data transfers. On August 1, 2024, the EU Artificial Intelligence Act Regulation (EU) 2024/1689 came into force, which regulates companies’ use of artificial intelligence systems and general purpose AI models. Requirements of the AI Act come into force in various phases over the next few years, with the bulk of the obligations on AI systems coming into force on August 2, 2026. We have already begun to prepare for implementation once the relevant provisions come into force and are continuously monitoring further regulatory developments in the area both within the EU and in other jurisdictions. Many countries outside the EU have started working on local laws, or issued administrative measures, frameworks or guidance related to the use of artificial intelligence. In addition, the European Commission has released a proposal for changes in several pieces of legislation including the AI Act, GDPR and other related data and digital legislation with the goal to simplify and harmonize. We are closely following these developments in order to ensure continued compliance, including in the areas of international data transfers.
In August 2025, the Israel Data Protection legislation amendment came into force. The amendment aligned local requirements more closely with global standards such as the EU GDPR. The amendment introduces enhanced enforcement mechanisms, including monetary sanctions and administrative fines, expanded data subject rights, and new organizational obligations. Teva has prepared and updated its internal compliance programs to comply with this amendment.
In the United States, the legislative and regulatory landscape for data privacy and protection continues to evolve with an increasing focus on privacy, data protection issues and artificial intelligence. There are numerous federal and state laws and regulations governing the collection, use, processing and protection of personal data. Most states have data security breach laws requiring data protection measures and potentially requiring notification to regulators and impacted individuals.
The Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009 (collectively, “HIPAA”) mandates the adoption of specific standards for electronic transactions and code sets that are used to transmit certain types of health information. HIPAA also sets forth federal rules protecting the privacy and security of protected health information (“PHI”). We have established administrative, physical and technical safeguards to protect the confidentiality, integrity and availability of PHI to the extent we are subject to HIPAA.
Numerous states have or are in the process of enacting state level consumer privacy laws and regulations governing the collection, use and processing of personal data. Additionally, the California Consumer Privacy Act of 2018 (“CCPA”) as amended established a privacy framework for covered businesses by creating an expanded definition of personal information, establishing new data privacy rights for consumers in the State of California, imposing special rules on the collection of consumer data from minors, and creating a new and potentially severe statutory damages framework for violations of the CCPA and for businesses that fail to implement reasonable security procedures and practices to prevent data breaches. Further, the California Privacy Rights Act (“CPRA”), effective January 1, 2023 (with certain provisions having retroactive effect to January 1, 2022), creates additional obligations with respect to processing and storing personal information. While clinical trial data and information governed by HIPAA are currently exempt from the current versions of the CCPA and CPRA, other personal information may be applicable and possible changes to the CCPA and CPRA may broaden its scope.
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Some states have or are in the process of enacting state consumer health information privacy laws (e.g., Washington’s My Health My Data Act) requiring protection of state residents’ health information not protected by HIPAA and potentially requiring reporting to state regulators with respect to our health and patient information privacy governance and practices.
In October 2015, the European Commission adopted regulations providing detailed rules for the safety features appearing on the packaging of medicinal products for human use. This legislation, part of the Falsified Medicines Directive (“FMD”), is intended to prevent counterfeit medicines entering into the supply chain and will allow wholesale distributors and others who supply medicines to the public to verify the authenticity of the medicine at the level of the individual pack. The safety features comprise a unique identifier and a tamper-evident seal on the outer packaging, which are to be applied to certain categories of medicines. FMD is effective as of February 2019. Teva’s packaging sites, distribution centers and contract manufacturing operators (“CMOs”) for the European market comply with this new requirement.
In February 2019, the EU enacted the Falsified Medicines Directive (“FMD”), traceability requirements for drug products, which Teva complies with as well. Other countries are following suit with variations of two main requirements: (i) to be able to associate the unit data with the uniquely-identified shipping package, or (ii) to report the data for tracking and tracing of products, reimbursements and other purposes. Certain countries, such as Russia, China, Korea, Turkey, Argentina, Brazil and India (for exported products), already have laws mandating serialization and aggregation and we are working to comply with these requirements. Other countries, including India (for domestic market), Indonesia, Kazakhstan, Malaysia, Taiwan, Ukraine and other Latin American countries are currently considering mandating similar requirements.
Available Information
Our main corporate website address is http://www.tevapharm.com. Copies of our Quarterly Reports on Form 10-Q, Annual Report on Form 10-K and Current Reports on Form 8-K filed or furnished to the U.S. Securities and Exchange Commission (the “SEC”), and any amendments to the foregoing, will be provided without charge to any shareholder submitting a written request to our company secretary at our principal executive offices or by sending an email to TevaIR@tevapharm.com. All of our SEC filings are also available on our website at http://www.tevapharm.com, as soon as reasonably practicable after having been electronically filed or furnished to the SEC. The SEC maintains an Internet site that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC at www.sec.gov. The information on our website is not, and will not be deemed, a part of this report or incorporated into any other filings we make with the SEC. We also file our annual reports and other information with the Israeli Securities Authority through its fair disclosure electronic system called MAGNA. You may review these filings on the website of the MAGNA system operated by the Israeli Securities Authority at www.magna.isa.gov.il or on the website of the Tel Aviv Stock Exchange (the “TASE”) at www.tase.co.il.
| ITEM 1A. | RISK FACTORS |
Our business faces significant risks. You should carefully consider all of the information set forth in this Annual Report and in our other filings with the SEC, including the following risk factors which we face and which are faced by our industry. Our business, financial condition and results of operations could be materially adversely affected by any of these risks. This report also contains forward-looking statements that involve risks and uncertainties. Our results could materially differ from those anticipated in these forward-looking statements as a result of certain factors including the risks described below and elsewhere in this report and our other SEC filings. For a summary of the risk factors included in this Item 1A and for further details on our forward-looking statements, see “Forward-Looking Statements and Risk Factor Summary” on page 1.
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Risks related to our ability to successfully compete in the marketplace
Sales of our generic medicines comprise a significant portion of our business, and we are subject to the significant risks associated with the generic pharmaceutical business.
Sales of our generic medicines have historically represented and are expected to continue to represent a significant portion of our global business. In 2025, total revenues from sales of our generic medicines in all our business segments were $9,421 million, or 55% of our total revenues. As part of our Pivot to Growth strategy, we are focusing on a prioritized portfolio and pipeline of high-value generics opportunities. However, generic medicines are generally less profitable than innovative medicines and have faced price erosion in each of our business segments, placing even greater importance on our ability to continually introduce new products. Although we intend to invest in the development of more complex, high-value generic products such as drug device combinations and long-acting injectables, there is no assurance as to when we will be successful in achieving our expected results, if at all.
We also expect to continue to experience significant challenges to our global generics business. Governments worldwide continue to implement healthcare regulatory reforms aimed at reducing drug costs, including but not limited to, imposing price caps and other limits on generic medicine pricing and reimbursement policies, including as a result of inquiries into drug pricing at federal, state and international levels. Additional challenges include changes to tendering systems, a decrease in value from future launches and growth, quality and supply chain challenges, trade restrictions and tariff volatility. Failure to anticipate or adapt to these evolving changes could materially impact our operations and financial performance.
Sales of our generic products may be adversely affected by the concentration of our customer base and commercial alliances among our customers.
A significant portion of our sales are made to relatively few U.S. retail drug chains, wholesalers, managed care purchasing organizations, mail order distributors and hospitals. These customers have undergone significant consolidation and formed various commercial alliances, which may continue to increase the pricing pressures that we face in the United States. The presence of large buying groups, and the prevalence and influence of managed care organizations and similar institutions, have increased pressure on price, as well as terms and conditions required to do business. In the United States, several large buying groups account for the majority of generics purchases, enabling each of them with significant bargaining power. Additionally, our customers may form commercial alliances which result in heightened pricing pressure and competition in the markets in which we operate. We expect the trend of pricing pressures from our customers and price erosion to continue.
Our sales may also be affected by fluctuations in the buying patterns of our significant customers, whether resulting from seasonality, pricing, wholesaler buying decisions or other factors. In addition, since a significant portion of our U.S. revenues is derived from relatively few key customers, any financial difficulties experienced by a single key customer, any delay in receiving payments from such a customer, or any significant reduction in or loss of business with such a customer could have a material adverse effect on our business, financial condition and results of operations. For a description of our net sales from our major customers, see note 19 to our consolidated financial statements.
Our revenues and profits from generic products may decline as a result of competition from other pharmaceutical companies and changes in regulatory policy.
Our generic products face intense competition. Prices of generic products may, and often do, decline, sometimes dramatically, especially as additional generic pharmaceutical companies receive approvals and enter the market for a given product and competition intensifies. Consequently, our ability to sustain our sales and profitability on any given product over time is affected by the number of companies selling competitive products, including new market entrants, and the timing of their approvals. For example, although in 2024, the majority of the increase in revenues in our U.S. generics business were driven by higher revenues from lenalidomide capsules (the generic version of Revlimid®), this trend is not expected to continue due to the intense competition
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in the coming years. The goals established under the Generic Drug User Fee Act, and increased funding of the FDA’s Office of Generic Drugs, have led to more and faster generic approvals, and consequently increased competition for some of our products. The FDA has stated that it has established new steps to enhance competition, promote access and lower drug prices and is approving increasing numbers of generic applications. While these FDA initiatives are expected to benefit our generic product pipeline, they will also benefit competitors that seek to launch products in established generic markets where we currently offer products. In recent years, there has also been an increase in the number of generic manufacturers targeting significant new generic opportunities with exclusivity under the Hatch-Waxman Act, including generic products which are complex to develop. Many of the smaller or emerging generic manufacturers have increased their capabilities, level of sophistication and development resources in recent years. The FDA has also been limiting the availability of exclusivity periods for new products, which reduces the economic benefit from being first-to-file for generic approvals. For example, the 180-day market exclusivity period under the Hatch-Waxman Act for a new product can be forfeited by failure to obtain approval or to launch a product within a specified time or if certain conditions exist, some of which may be outside our control. The failure to maintain our industry-leading performance in the United States on first-to-file opportunities and to develop and commercialize high complexity generic products could adversely affect our sales and profitability.
Furthermore, brand pharmaceutical companies continue to manage products in a challenging environment through marketing agreements with payers, pharmacy benefits managers and generic manufacturers. For example, brand companies often sell or license their own generic versions of their products, known as “authorized generics,” either directly or through other generic pharmaceutical companies. No significant regulatory approvals are required for authorized generics, and brand companies do not face any other significant barriers to entry into such market. Brand companies may seek to delay introductions of generic equivalents through a variety of commercial and regulatory tactics. Many pharmaceutical companies increasingly have used state and federal legislative and regulatory means to delay generic (including biosimilar) competition. These actions may increase the costs and risks of our efforts to introduce generic products and may delay or prevent such introduction altogether.
In addition, the U.S. Congress and various state legislatures in the United States have passed, or have proposed passing, legislation that could have an adverse impact on pharmaceutical manufacturers’ ability to (i) settle litigation initiated pursuant to the Hatch-Waxman Act and Biologics Price Competition and Innovation Act (“BPCIA”); (ii) secure the full benefit of first-to-file regulatory approval status secured under the Hatch-Waxman Act; and (iii) recover their investments into the development of an innovative, generic or biosimilar product. Hatch-Waxman and BPCIA create various pathways for generic drug manufacturers to secure accelerated approvals of their abbreviated new drug applications and abbreviated biologics license applications. The new laws and proposals from the federal and state governments could serve to change, directly and indirectly, the Hatch-Waxman Act and BPCIA, including the incentives to develop generic and biosimilar products, as well as the ability of generic manufacturers to accelerate the launch of their new generic and biosimilar products. They could also impact the ability of brand manufacturers to protect their investments in the intellectual property associated with their branded specialty and innovative biologic products.
Additionally, pharmaceutical pricing reforms in the United States have also been introduced through the enactment of the Inflation Reduction Act of 2022 (the “IRA”), which has led to greater pricing pressures on our products. For more information, see “—Risks related to compliance, regulation and litigation—Our operations are subject to complex legal and regulatory environments.” If we fail to comply with applicable laws and regulations we may suffer legal consequences that may have a material effect on our business, operations or reputation.
In the European Union, certain exclusivity provisions may prevent companies from applying for marketing approval for a generic product for a certain number of years (data exclusivity), and further, the generic product will be barred from market entry (marketing exclusivity) for an additional two years, which may be extended by a year in certain circumstances. The pharmaceutical legislation in the European Union is currently under review,
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which may result in changes to the duration of and criteria for obtaining data and market exclusivity once the new legislation comes into force. See “Item 1—Business—Regulation” for more information.
We continue to monitor these legislative developments and evaluate their impacts on us and whether any changes to our business practices and operations are necessary in order to comply with such legislative reforms. However, we cannot accurately predict the ultimate impact of such legislative developments on our business or whether additional changes in regulatory policies will occur in the future.
We have experienced, and may continue to experience, delays in launches of our new generic products.
Although we believe we have one of the most extensive pipelines of generic products in the industry, we have in the past been unable to successfully execute a number of generic launches and may face similar challenges in the future. As a result of delays in the timing of launches, we may not be able to realize the anticipated economic benefits. If we cannot execute timely launches of new products, we may not be able to offset the increasing price erosion on existing products in the United States resulting from pricing pressures and accelerated generics approvals for competing products. Such unsuccessful launches can be caused by many factors, including but not limited to, delays in regulatory approvals, lack of operational or clinical readiness or patent litigation. Failure or delays to execute launches of new generic products could have a material adverse effect on our business, financial condition and results of operations.
We may be unable to take advantage of the increasing number of high-value biosimilars opportunities.
We aim to be a global leader in biopharmaceuticals. As part of our Pivot to Growth strategy, we have been capitalizing on our late-stage pipeline of biosimilar products. The development, manufacture and commercialization of biosimilar products require specialized expertise and are very costly and subject to complex evolving regulation. Due to the complex process and significant financial and other resources required to develop biosimilars, obstacles and delays, including budget constraints, have in the past and may in the future arise, which increase the cost of development or force us to abandon a potential product in which we may have invested substantial amounts of time and resources. We have made and will continue to make significant investments and collaborations to capitalize on biosimilar opportunities. However, the market for biosimilar products, in particular for key lifecycle products, is facing increasingly intense competition, including from new market entrants, growing pricing pressures, as well as from existing innovative products that maintain a significant market share, and there is no assurance that we will be able to successfully capitalize on biosimilar opportunities. Failure to develop, supply and commercialize biosimilars, either by us or through collaborations with third parties, could have a material adverse effect on our business, financial condition, results of operations and prospects.
Intense competition may adversely affect our ability to successfully develop and commercialize innovative medicines.
We operate in a highly competitive and rapidly evolving industry and face intense competition to our innovative medicines. As we transform into a leading biopharmaceutical company, and as part of our Pivot to Growth strategy, we have been focused on delivering on our growth engines, mainly AUSTEDO, AJOVY and UZEDY, and stepping up the innovation of our late-stage innovative pipeline assets. Our success depends on our ability to discover, develop, and commercialize innovative products ahead of competitors. However, numerous pharmaceutical and biotechnology companies, as well as academic institutions and research organizations, are engaged in the development of products that may compete directly with ours. Many of these competitors have substantially greater financial, technical, and to some extent marketing resources, as well as more established commercial infrastructures. As a result, any products and/or innovations that we develop may become obsolete or noncompetitive before we can recover the expenses incurred in connection with their development. In addition, we must demonstrate the benefits of our products relative to competing products that are often more familiar or otherwise better established with physicians, patients and third-party payers. Competitors have in the past and
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may in the future introduce new products or new variations on their existing products, our marketed products, or even those protected by patents, which have in the past and may in the future be replaced in the marketplace or we may be required to lower our prices.
For example, the following may have a significant effect on our financial results and cash flow:
| • | AUSTEDO: our future success depends on our ability to maximize the growth and commercial success of AUSTEDO and AUSTEDO XR. If our revenues derived from AUSTEDO and AUSTEDO XR do not increase as expected and/or if we lose market share to competing therapies, our results of operations may be adversely affected; |
| • | AJOVY faces strong competition from two products that were introduced into the market around the same time and are competing for market share in the same space, as well as from other emerging competing therapies, including oral CGRP products; |
| • | UZEDY is a late entrant in the atypical antipsychotic long-acting injectables (LAIs) space and faces significant competition from multiple well-established products. Although UZEDY is well differentiated in the LAI space, more branded and generic products that recently launched or will launch in the near future can further impact UZEDY’s growth; |
| • | COPAXONE faces competition from generic versions in the U.S. and competing glatiramer acetate products in Europe, as well as from orally-administered therapies. Since the introduction of generic and oral competition, COPAXONE’s revenues and profitability have decreased. We expect the trend of decreasing revenues and profitability for COPAXONE to continue in the future; and |
| • | there is a trend in the innovative medicines industry of seeking to “outsource” drug development by acquiring companies with promising drug candidates and we face substantial competition from historically innovative companies, as well as companies with greater financial resources than us, for such acquisition targets. |
In order to remain competitive, we must invest significant resources to expand our pipeline for innovative medicines and biosimilars, both through our own efforts and through collaborations with, and in-licensing or acquisition of products from, third parties. We have entered into, and expect to pursue, in-licensing, acquisition, collaboration, funding and partnership opportunities to supplement and expand our existing innovative medicines and biosimilar pipeline, such as our collaborations with Alvotech, Medincell, Modag, Sanofi, Royalty Pharma, Biolojic, Launch Therapeutics and mAbxience. However, there is no assurance that we will be able to enter into additional collaborations in the future, or that our existing collaborations will achieve the results we expect, and we or our counterparties could fail to perform the obligations thereunder, including due to failure to obtain regulatory approvals and increasing competition, pricing pressures and other financial constraints. In addition, we may not be able to achieve the cost savings that we expect to realize within the expected time frame under our Teva Transformation programs announced in May 2025, due to unforeseen risks, which could impact our financial condition and ability to invest in our innovative pipeline and growth drivers.
Furthermore, the development of innovative medicines involves lengthier and more complex processes and greater expertise and resources than those used in the development of generic medicines. For example, the time from discovery to commercial launch of an innovative medicine can be 15 years or more and involves multiple stages, including intensive preclinical and clinical testing and highly complex, lengthy and expensive regulatory approval processes, which vary from country to country. The longer it takes to develop a new product, the less time that remains to recover development costs and generate profits. During each stage, we may encounter obstacles that delay the development process and increase expenses, potentially forcing us to abandon a potential product in which we may have invested substantial amounts of time and resources. These obstacles may include preclinical failures, difficulty enrolling patients in clinical trials, delays in completing formulation and other work needed to support an application for approval, adverse reactions or other safety concerns arising during clinical testing, insufficient clinical trial data to support the safety or efficacy of the product candidate, widespread supply chain breakdowns, delays as a result of new requirements implemented by health authorities
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such as the U.S. FDA and EMA requirement on material use, or any impact of a prolonged government shutdown, and delays or failures to obtain required regulatory approvals for the product candidate or the facilities in which it is manufactured. In addition, our innovative medicines require much greater use of a direct sales force than our generics business. Our ability to realize revenues from direct marketing and sales activities depends on our ability to attract and retain qualified sales personnel. Competition for qualified sales personnel is intense. We may also need to enter into co-promotion arrangements, or use contracted sales personnel or other such arrangements with third parties, for example, where our own direct sales force is not large enough or sufficiently well-aligned to achieve maximum market penetration. Any failure to attract or retain qualified sales personnel or to enter into third-party arrangements on favorable terms could prevent us from successfully maintaining current sales levels or commercializing new innovative medicines.
If generic or biosimilar products that compete with any of our innovative medicines are approved and sold, sales of our innovative medicines will be adversely affected.
Certain of our innovative medicines face patent challenges and impending patent expirations and some have recently become susceptible to generic competition, such as ProAir HFA and QVAR®. Generic equivalents and biosimilars for branded pharmaceutical products are typically sold at lower costs than the branded products. After the introduction of a competing generic (or biosimilar) product, a significant percentage of the prescriptions previously written for the branded product are often written for the generic version. Legislation enacted in most U.S. states allows or, in some instances, mandates that a pharmacist dispense an available generic equivalent (or interchangeable biosimilar) when filling a prescription for a branded product in the absence of specific instructions from the prescribing physician. Branded products typically experience a significant loss in revenues following the introduction of a competing generic (or biosimilar) product, even if the branded product is still subject to an existing patent since generic manufacturers may offer generic (or biosimilar) products while patent litigation is pending. Our innovative medicines have in the past and may in the future become subject to competition from generic equivalents due to the expiration of a patent or loss of patent protection. In addition, we may from time to time seek to obtain additional patent protection for our innovative medicines covering proprietary product improvements and/or new and enhanced dosage forms, but there are no guarantees those efforts will succeed.
Our success depends on our ability to develop and commercialize additional pharmaceutical products.
Our financial results depend upon our ability to develop and commercialize additional innovative, biosimilar and generic products in a timely manner. Commercialization requires that we successfully develop, test and manufacture pharmaceutical products, both through our own efforts and through collaborations with, and in-licensing or acquisition of products from, third parties. All of our products must receive regulatory approval and meet, and continue to comply with, regulatory and safety standards. If health or safety concerns arise with respect to a product, we may be forced to withdraw it from the market. Developing and commercializing additional pharmaceutical products is also subject to difficulties relating to the availability, on commercially reasonable terms, of raw materials, including API and other key ingredients; preclusion from commercialization by the proprietary rights of others; the costs of manufacturing and commercialization; costly legal actions brought by our competitors that may delay or prevent the development or commercialization of a new product; and delays and costs associated with the approval process of the FDA and other U.S. and international regulatory agencies.
The development and commercialization process, particularly with respect to innovative medicines and biosimilar medicines, as well as complex generic medicines that we increasingly focus on, is both time-consuming and costly, and involves a high degree of business risk. Our products currently under development, if and when fully developed and tested, may not perform as we expect. Necessary regulatory approvals may not be obtained in a timely manner, if at all, and we may not be able to produce and market such products successfully and profitably. Delays in any part of the process or our inability to obtain regulatory approval of our products could adversely affect our operating results by restricting or delaying our introduction of new products.
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We depend on the effectiveness of our patents, confidentiality agreements and other measures to protect our intellectual property rights.
The success of our innovative medicines business depends substantially on our ability to obtain patents and to defend our intellectual property rights. If we fail to protect our intellectual property adequately, competitors may manufacture and market products identical or similar to ours. We have been issued numerous patents covering our innovative medicines, and have filed, and expect to continue to file, patent applications seeking to protect newly developed technologies and products in various countries, including the United States. Currently pending patent applications may not result in issued patents or be approved on a timely basis. Any existing or future patents issued to or licensed by us may not provide us with any competitive advantages for our products or may be challenged or circumvented by competitors or governments. For additional information see “Risks related to compliance, regulation and litigation,” below.
Efforts to defend the validity of our patents are expensive and time-consuming, and there can be no assurance that such efforts will be successful. Our ability to enforce our patents also depends on the laws and practices of individual countries regarding the enforcement of intellectual property rights and may also be impacted by regulatory actions taken by governmental authorities that affect our ability to use and maintain our intellectual property rights. The loss of patent protection or regulatory exclusivity on innovative medicines, could materially impact our business, results of operations, financial condition and prospects. For additional information see “Risks related to compliance, regulation and litigation,” below.
We also rely on trade secrets, unpatented proprietary know-how, trademarks, regulatory exclusivity and continuing technological innovation that we seek to protect, in part by confidentiality agreements with licensees, suppliers, employees and consultants. These measures may not provide adequate protection for our unpatented technology. If these agreements are breached, it is possible that we will not have adequate remedies. Disputes may arise concerning the ownership of intellectual property or the applicability of confidentiality agreements. Furthermore, our trade secrets and proprietary technology may otherwise become known or be independently developed by our competitors or we may not be able to maintain the confidentiality of information relating to such products. If we are unable to adequately protect our technology, trade secrets or proprietary know-how, or enforce our intellectual property rights, our results of operations, financial condition and cash flows could suffer.
Risks related to our significant indebtedness
We have significant debt outstanding, which requires significant interest and principal payments, requires compliance with certain covenants and restricts our ability to incur additional indebtedness or engage in other transactions.
As of December 31, 2025, we have consolidated debt of $16,807 million outstanding, compared to $17,783 million outstanding as of December 31, 2024. The cash required to finance our interest and principal payment obligations under such debt reduces the cash available to fund our capital expenditures and grow our business and reduces our flexibility to respond to changes in economic and industry conditions. If we are unable to meet our debt service and other financial obligations, we could be forced to restructure or refinance our indebtedness, seek additional debt or equity capital or sell assets. We may be unable to obtain such financing or capital or sell our assets on satisfactory terms, if at all. Any refinancing of our indebtedness could be at significantly higher interest rates, incur significant transaction fees or include more restrictive covenants. See “Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity” and note 9 to our consolidated financial statements for a detailed discussion of our outstanding indebtedness.
Our unsecured syndicated sustainability-linked revolving credit facility (“RCF”) contains certain covenants, including certain limitations on incurring liens and indebtedness and maintenance of certain financial ratios, including a maximum leverage ratio, which becomes more restrictive over time. Non-compliance with such covenants, under certain circumstances, may result in our inability to borrow under the RCF or an event of default in all borrowings under the RCF. Additionally, non-compliance with such covenants, when greater than a
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specified threshold amount as set forth in each series of senior notes and when sustainability-linked senior notes are outstanding, could lead to an event of default under our senior notes and sustainability-linked senior notes due to cross acceleration provisions.
While we continue to take steps to reduce our debt and improve profitability, if we fail to satisfy our financial ratio covenants, we may need to renegotiate and amend the covenants, or refinance the debt with different repayment terms. We cannot guarantee that we will be able to amend such agreements or refinance such debt on terms satisfactory to us, or at all. If we experience lower than anticipated earnings or cash flows, to maintain compliance with our financial ratio covenants, we may curtail spending or divest assets, which could constrain our ability to grow our business.
We may need to raise additional funds in the future, which may not be available on acceptable terms or at all.
We may consider issuing additional debt or equity securities in the future to refinance existing debt or for general corporate purposes, including to fund our growth strategies, and to fund potential acquisitions or investments. If we issue ordinary equity, convertible preferred equity or convertible debt securities to raise additional funds, our existing shareholders may experience dilution, and the new equity or debt securities may have rights, preferences and privileges senior to those of our existing shareholders. If we incur additional debt, it may increase our leverage relative to our earnings or to our equity capitalization, requiring us to pay additional interest and potentially lowering our credit ratings. Our ability to incur debt may also be impacted by our credit ratings, which could impact the cost and availability of our future borrowings and, accordingly, our cost of capital. We have in the past been and may in the future be subject to ratings downgrades or negative outlooks by ratings agencies, which could negatively impact our ability to raise debt or borrow funds in amounts or on terms that are favorable to us, if at all. Additionally, capital and credit markets, which have been disrupted by macroeconomic pressures, have experienced volatility. As a result, access to additional financing may be challenging and is largely dependent upon market conditions, which could materially impact our business, results of operations, financial condition and prospects. If we are unable to raise additional funds in the future in amounts and on terms that are acceptable to us, we may not be able to develop or enhance our products, execute our business plan, take advantage of future opportunities or respond to competitive pressures or unanticipated customer requirements.
Risks related to our general business and operations
Global economic conditions may negatively affect us and may magnify certain risks that affect our business.
We conduct our operations globally, including in the United States, Europe and our International Markets. Global developments can affect our business in many ways. Our global operations are affected by local economic environments, including inflation, recession, and competition. Increased inflation rates have in the past and may in the future increase our and our suppliers’ operating costs, including labor costs, manufacturing costs and R&D costs. If in the future we are unable to manage rising costs as a result of inflation and its broader effects on the markets in which we operate, our operations may be materially affected. Additionally, divergent or evolving regulatory systems can increase the risks and burdens of operating in numerous countries. For example, recent U.S. tariffs imposed or threatened to be imposed on goods, materials, and products from countries where we do business, and any retaliatory actions taken by such countries could result in us incurring substantial additional costs to source goods, materials, and products, directly and indirectly, from affected countries, and may require us to raise prices on certain products and seek alternative sources of supply. If our competitors do not increase prices, or increase prices to a lesser extent than we do, or are able to offset the impact of tariffs through other actions, our competitive and financial position may be adversely affected. Additionally, if we are not able to find adequate alternate sources of supply, we may experience supply shortages or disruptions. In addition to rising inflation, the global economy has also been impacted by fluctuating foreign exchange rates, geopolitical tensions and supply chain disruptions. Supply chain disruptions could continue to result in delays in our production and distribution processes, R&D initiatives and our ability to timely respond to consumer demand. As we have substantial international operations, fluctuations in exchange rates between the currencies in which we operate
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and the U.S. dollar could increase our operating costs and adversely affect our results of operations, profits and cash flows. The duration and extent of rising inflation, higher interest rates, foreign exchange rate fluctuations, evolving regulatory systems including with respect to recent U.S. tariffs, geopolitical tensions and other macroeconomic headwinds are uncertain and we cannot accurately predict whether we will be able to effectively mitigate their impact on our business.
Due to the complexity of our supply chain, we have experienced supply discontinuities due to macroeconomic issues, regulatory actions, including sanctions and trade restrictions, labor disturbances and approval delays, which have impacted our ability to timely meet demand in certain instances. These adverse market forces have a direct impact on our overall performance. Any such disruptions could have a material adverse impact on our business and our results of operation and financial condition.
Implementation of ongoing optimization efforts may adversely affect our business, financial condition and results of operations.
We have and will continue to implement changes to optimize our business operations and reallocate resources towards growth opportunities. As part of our Pivot to Growth strategy, in May 2025, we announced the Teva Transformation programs which are expected to generate cost savings for the Company, including by examining practices and efficiencies in methods of working, reduction in headcount and optimizing external spend. In connection with these programs, we may not be able to achieve the cost savings that we expect to realize in the expected time frame due to unforeseen risks, which could impact our financial condition and ability to invest in our innovative pipeline and growth drivers.
In addition, as part of such optimization efforts, we have in the past and may in the future face wrongful termination, discrimination or other legal claims from employees affected by ongoing changes in our workforce. We may incur substantial costs defending against such claims, regardless of their merits, and such claims may significantly increase our severance costs.
Upon the proposed divestiture of any assets, including divestitures of business units as part of our Pivot to Growth strategy to focus on our core businesses, as well as divestitures of our facilities in connection with our ongoing plant optimization, we may not be able to consummate such divestitures at a favorable price or in a timely manner. Any divestiture that we are unable to complete may cause additional costs associated with retaining, closing or disposing of the impacted businesses.
Workforce reductions, such as the reduction as part of the Teva Transformation programs announced in May 2025, and site consolidation have in the past and may in the future result in the loss of numerous long-term employees, the loss of institutional knowledge and expertise, the reallocation of certain job responsibilities, the disruption of business continuity and legal claims from affected employees, all of which could negatively affect operational efficiencies and our ability to achieve growth and profitability through the development and sale of new pharmaceutical products. We cannot guarantee that, following such efficiency measures, our business will be more efficient or effective.
Significant disruptions of our information technology systems could adversely affect our business.
We rely extensively on information technology systems (including cloud services) in order to conduct business, including systems managed by third-party service providers. These systems include programs and processes relating to internal and external communications, ordering and managing materials from suppliers, converting materials to finished products, shipping products to customers, processing transactions, summarizing and reporting results of operations, processing payments to employees and vendors, calculating sales receivables, generating our financial results, and complying with information technology security compliance and other regulatory, legal or tax requirements. These information technology systems could be damaged or cease to function properly due to the poor performance or failure of third-party service providers, catastrophic events,
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power outages, network outages, failed upgrades and other events. If our business continuity plans do not effectively resolve such issues on a timely basis, we may suffer significant interruptions in conducting our business, which may adversely impact our business, financial condition and results of operations.
Furthermore, our systems and networks, and those managed by our third-party service providers, have been, and are expected to continue to be, the target of increasingly advanced and evolving cyber-attacks which may pose a risk to the security of our systems and the confidentiality, availability and integrity of our data, as well as disrupt our operations or damage our facilities or those of third parties. Our exposure to cybersecurity risks may be heightened by the global scope of our operations. Because the techniques, tools and tactics used in cyber-attacks frequently change and may be difficult to detect for periods of time, despite our attention to such threats, we may face difficulties in anticipating and implementing adequate preventative measures or mitigating harms after such an attack. Cybersecurity attacks have become increasingly complex as they are enhanced or facilitated by the emergence of new technologies such as artificial intelligence (“AI”) that are used to identify and target new vulnerabilities in our information technology systems or those of our customers, third-party vendors and other business partners. For example, AI and deepfake technologies could be used to attack information systems by creating more effective phishing emails or social engineering and by exploiting vulnerabilities in electronic security programs utilizing false image or voice recognition. There is no assurance that we, our customers, third-party vendors or other business partners will be able to promptly and effectively respond to such new increasingly sophisticated threats. Additionally, there is no assurance that we will be able to leverage the use of AI technologies within our business, which may position us in a competitive disadvantage relative to our competitors.
In addition, hardware, software or applications we develop or procure from third parties may contain defects in design or manufacture or other problems that could unexpectedly compromise information security. We outsource administration of certain functions to vendors that could be targets of cyber-attacks. Any manipulation, theft, loss and/or fraudulent use of customer, employee or proprietary data as a result of a cyber-attack targeting us or one of our third-party service providers could subject us to significant litigation, liability and costs, as well as adversely impact our reputation with customers and regulators. A cyber-attack on our information technology systems may lead to substantial interruptions in our business, legal claims and liability, regulatory investigations and penalties, and reputational damage, which could have a material adverse effect on our business, financial condition and results of operations. While we maintain insurance coverage that is designed to address certain aspects of cyber risks, such insurance coverage may be insufficient to cover all losses or all types of claims that may arise in the event we experience a cybersecurity incident, data security breach or disruption, unauthorized access, or failure of systems.
Our adoption of artificial intelligence (“AI”) technologies introduces new risks and uncertainties
Our adoption of AI technologies introduces new risks and uncertainties. These include potential inaccuracies or biases in AI outputs, cybersecurity vulnerabilities, and evolving global regulatory requirements governing AI use. Misuse or malfunction of AI systems could adversely impact our operations, reputation, or compliance. For example, use of AI technologies can lead to unintended consequences, including generating content that appears correct but is factually inaccurate, misleading or otherwise flawed, or that results in unintended biases and discriminatory outcomes, which could negatively impact individuals, harm our reputation and business, and expose us to liability. Additionally, rapid technological changes and competitive pressures may require significant ongoing investment to maintain effective and responsible AI capabilities.
A data security breach could adversely affect our business and reputation.
In the ordinary course of our business, we collect and store sensitive data, including intellectual property, proprietary business information and personally identifiable information (including of our employees, customers, suppliers and business partners). Any data breach may subject us to civil fines and penalties, or regulatory orders, fines or sanctions such as under the EU GDPR or EU NIS2, or equivalent under relevant national laws, the federal Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) as amended, and other relevant
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state and federal privacy laws in the United States, including the California Consumer Privacy Act (“CCPA”) and other laws and regulations including across our International Markets. Our failure, or the failure of our third-party vendors, to comply with applicable laws and regulations relating to data security and our involvement or the involvement of any of our third-party vendors in any data security incidents could result in legal claims and liability, obligations to report incidents to governmental agencies, regulatory investigations and penalties, and reputational damage, which could have a material adverse effect on our business, financial condition and results of operations.
We have procedures, tools, processes and services in place to detect and respond to cyber-attacks, data breaches, security incidents, and compromises of personal and other information. If our efforts to protect the security of data are unsuccessful, a cyber-attack, data breach, security incident, or compromise of personal information may result in costly legal claims and liability, financial penalties, government enforcement actions, for example under the EU GDPR or EU NIS2, private litigation, negative publicity or a reduction in supply of essential medicines to the public, or regulator orders requiring us to change the way our business is conducted, each of which could further result in reputation or brand damage with customers, and our business, financial condition, results of operations or prospects could suffer.
The manufacture of our products is highly complex, and an interruption in our supply chain or problems with internal or third party manufacturing could adversely affect our results of operations.
Our products are either manufactured at our own facilities or obtained through supply agreements with third parties. Many of our products are the result of complex manufacturing processes, and some require highly specialized raw materials. Problems may arise during manufacturing for a variety of reasons, including equipment malfunction, failure to follow specific protocols and procedures including cGMPs, problems with or shortages of raw materials, widespread outbreaks of disease or other public health crises, natural disasters, extreme weather events such as floods, heatwaves, blizzards, hurricanes, wildfires, the rise of sea level, and water stress, and other environmental factors, which could have a material adverse impact on our operations and financial condition. Additionally, as our manufacturing plants and equipment age, they become more prone to failure. If we are not able to make capital improvements to such plants and equipment, or if they otherwise deteriorate, we could experience disruptions to our operations, manufacturing delays, further obsolescence and increased costs associated with repairs, which could have a material adverse effect on our business and financial condition.
For some of our key raw materials, we have only a single, source of supply, and alternate sources of supply may not be readily available. If our supply of certain raw materials or finished products is interrupted from time to time, or proves insufficient to meet demand, our cash flows and results of operations could be adversely impacted. Additionally, any such supply interruption could result in a supply shortage to patients depending on the number of competitors able to meet the supply needs. Moreover, the streamlining of our manufacturing network may result in our product supply becoming more dependent on a smaller number of specific manufacturing plants. Our inability to timely manufacture or to procure from a third party supplier, any of our key products, may result in claims and penalties from customers and could have a material adverse effect on our business, financial condition and results of operations as well as result in reputational harm.
In recent years, medicine shortages have become an increasingly widespread problem around the world. We are working diligently across our supply chain to ensure continuous and stable supply. Many European countries are implementing legal and regulatory measures, such as mandatory stockpiling and high penalties in order to prevent supply disruptions. Such measures may lead to substantial monetary losses in case we experience long-term supply disruptions in the relevant territories.
We also rely on complex shipping arrangements to and from the various facilities of our supply chain. Customs clearance and shipping by land, air or sea routes rely on and may be affected by factors that are not in our control or are hard to predict. Any significant disruptions to the shipping arrangements for our products could materially and adversely affect our operations and financial results.
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We have significant operations globally, including in countries that may be adversely affected by political or economic instability, major hostilities or acts of terrorism, which exposes us to risks and challenges associated with conducting business internationally.
We are a global pharmaceutical company with worldwide operations. While a substantial majority of our sales in 2025 were in the United States and Europe a portion of our sales and operational network are located in other regions. Certain of the regions in which we operate may be more susceptible to instability, such as the ongoing conflict between Russia and Ukraine and in the Middle East, that could result in a loss of sales in such regions. Although to date our business has not been materially impacted by such geopolitical conflicts, the implications (including potential inflation and devaluation consequences) of geopolitical conflicts cannot be predicted and could in the future have a material and adverse effect on our business, exchange rate exposure, supply chain, operational costs and commercial presence in these markets.
Significant portions of our operations are conducted outside the markets in which our products are sold, and accordingly we often import a substantial number of products into such markets. We may, therefore, be denied access to our customers or suppliers or denied the ability to ship products from any of our sites as a result of a closing of the borders of the countries in which we sell our products, or in which our operations are located, due to economic, legislative, political and military conditions, including hostilities and acts of terror, in such countries. In addition, certain countries, such as Russia, have imposed regulations requiring local manufacturing of goods, while foreign-made products are subject to pricing penalties or even bans from participation in public procurement auctions in other countries.
We face additional risks inherent in conducting business internationally, including compliance with laws and regulations of many jurisdictions that apply to our international operations. These laws and regulations include intellectual property laws, data privacy requirements, labor relations laws, tax laws, competition regulations, import and trade restrictions, economic sanctions, export requirements, the Foreign Corrupt Practices Act (“FCPA”), the UK Bribery Act 2010 and other similar local laws that prohibit corrupt payments to governmental officials or certain payments or remunerations and provisions of things of value to customers and, in some cases, other private sector counterparties. Modifications of such laws or court decisions regarding such laws may adversely affect us and may impact our ability to continue our international operations. Given the high level of complexity of these laws, there is a risk that some provisions may be breached by us, for example through fraudulent or negligent behavior of individual employees (or third parties acting on our behalf), our failure to comply with certain formal documentation requirements, or otherwise. Actions by our employees, or by third-party intermediaries acting on our behalf, in violation of such laws, whether carried out in the United States or elsewhere in connection with the conduct of our business have exposed us, and may further expose us, to significant liability for violations of the FCPA or other anti-corruption laws. In 2016, we paid a monetary fine for FCPA violations and entered into a three-year deferred prosecution agreement with the DOJ, which included retaining an independent compliance monitor. The FCPA also requires us to keep and maintain accurate books and records and systems of internal controls to prevent bribery and corruption. Violations of these laws and regulations could result in fines, criminal sanctions against us, our officers or our employees, implementation of compliance programs and prohibitions on the conduct of our business. Any such violation could include prohibitions on our ability to offer our products in one or more countries and could materially damage our reputation, our brand, our ability to attract and retain employees, our business, our financial condition and our results of operations.
Our corporate headquarters and a portion of our manufacturing activities are located in Israel. Our Israeli operations are dependent upon materials imported from outside Israel. Accordingly, our operations and information technology systems could be materially and adversely affected by acts of terrorism, including through cybersecurity threats, or by an escalation of major hostilities in the Middle East, or a material impairment of trade between Israel and other countries, including as a result of acts of terrorism in the United States or elsewhere. Ongoing military activity in the Middle East may result in disruption to our operations and facilities, such as our manufacturing and R&D facilities located in Israel.
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Our continued success depends on our ability to attract, hire, integrate and retain highly skilled key personnel.
Given the size, complexity and global reach of our business and our multiple areas of focus, we are especially reliant upon our ability to recruit and retain highly qualified management and other key employees. Our ability to attract and retain such employees may be diminished by the financial, legal and regulatory challenges and ongoing restructuring and optimization efforts we have faced in recent years, as well as increased competition for talent. In addition, the success of our R&D activity depends on our ability to attract and retain sufficient numbers of skilled scientific personnel. Changes in our management as a result of the appointment or departure of members of management and other key employees may also cause disruptions to our business and result in the loss of key personnel with institutional knowledge of our business, negative impacts on our relationships with existing employees and customers and increased operating costs related to integrating new personnel. Any difficulty in recruiting, hiring, integrating, retaining and motivating talented and skilled members of our organization may adversely impact us.
We may not be able to find or successfully bid for suitable acquisition targets or licensing opportunities, or consummate and integrate future acquisitions.
In addition to pursuing organic growth opportunities, we intend to continue to evaluate and pursue potential acquisitions, strategic alliances, joint ventures and licenses, among other transactions, as part of our strategy to optimize our business and product portfolio and reallocate resources to fund growth. Relying on such transactions as sources of new innovative medicines, biosimilar and other products, or as a means of growth, involves risks that could adversely affect our future revenues and operating results. We may not be successful in seeking or consummating appropriate opportunities to enable us to execute on our business strategy. We may not be able to pursue opportunities due to financial capacity constraints, we may not be able to obtain necessary regulatory approvals, and we may fail to consummate an announced transaction. We may fail to integrate acquired assets successfully into our existing business, and could incur or assume significant debt and unknown or contingent liabilities, including, among others, patent infringement, product liability or breach of diligence claims. In addition, we, or the partners with which we may enter into licensing or other collaboration agreements, may not be able to perform effectively under such agreements, impairing our ability to monetize opportunities related to them.
We may decide to sell, close or otherwise divest business units, assets or facilities, and any failure to successfully and cost-effectively consummate such divestitures could adversely affect our prospects and opportunities for growth.
We will continue to consider selling, closing or otherwise divesting certain business units, assets and facilities as the focus of our business evolves, including as part of our Pivot to Growth strategy, if we determine that such assets are not critical to our strategy or we believe the opportunity to monetize the asset is attractive or for various other reasons, including for the reduction of indebtedness. For example, as previously announced, we intend to divest our API business, which divestiture is subject to various conditions, including identifying a prospective purchaser and reaching an agreement on terms satisfactory to Teva, satisfying any conditions to closing the divestiture and obtaining any necessary approvals. We have also closed or divested a significant number of manufacturing plants and R&D facilities in the past and may close or divest additional plants and facilities as part of our ongoing efforts regarding optimizing our business. There can be no assurance that we will be able to complete any divestitures of our business units, assets or facilities, including our intended divestiture of our API business, on the timing or upon the terms we expect, if at all. Such divestitures may also divert management’s attention from our core business operations, increase our expenses in the short-term and disrupt our relationships with existing employees, customers or suppliers.
We may fail to identify appropriate opportunities to divest assets on terms acceptable to us or may fail to transition employees and continuing operations from closed sites and disposed businesses efficiently. If divestiture opportunities are found, consummation of any such divestiture may be subject to closing conditions, including obtaining necessary regulatory approvals, and we may fail to consummate an anticipated divestiture.
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Although our expectation is to engage in asset sales only if they advance or otherwise support our overall strategy, any such sale could result in disruptions to our business operations, result in unanticipated expenses and reduce the size or scope of our business, our manufacturing network, our market share in particular markets or our opportunities with respect to certain markets. If we are unable to complete our planned divestitures in a timely and cost-effective manner, or if we do not realize the anticipated cost savings or other benefits of such transactions, our prospects and opportunities for growth may be materially adversely impacted.
Risks related to compliance, regulation and litigation
Our operations are subject to complex legal and regulatory environments. If we fail to comply with applicable laws and regulations we may suffer legal consequences that may have a material effect on our business, operations or reputation.
We operate around the world in complex legal and regulatory environments. For instance, we must comply with requirements of the FDA, EMA, U.S. state licensure bodies, and other healthcare regulators with respect to the manufacture, labeling, sale, distribution, marketing, advertising, promotion and development of pharmaceutical products, as further described below. We are also subject to pricing laws, including newly-enacted state laws in the United States, which impose price controls such as penalties for pricing certain products above state-defined thresholds, as well as competition laws, economic sanctions, export controls, import and trade laws and regulations, healthcare fraud and abuse (including anti-bribery laws), privacy laws, cGMP requirements, labor laws and health and safety laws. Any failure to comply with applicable laws, rules and regulations may result in civil and/or criminal legal proceedings and lead to fines, damages, mandatory compliance programs and other sanctions and remedies that may materially affect our business and operations as well as our reputation. In addition, as rules and regulations change or as interpretations of those rules and regulations evolve, our prior conduct may be investigated.
Our business operations are subject to extensive regulation by the FDA and various other U.S. federal and state regulatory authorities, the EMA and other foreign regulatory authorities that establish requirements relating to, among other things, manufacturing practices, product labeling, and advertising and post marketing reporting, including adverse event reports and field alerts due to manufacturing quality concerns. Notably, in September 2025, the FDA announced its intent to rein in direct-to-consumer advertising by increasing enforcement and revising existing regulations to be more restrictive. On September 9, 2025, Teva received two untitled letters from the FDA regarding claims in AUSTEDO television advertisements to which Teva has responded. The process of obtaining regulatory approvals to market a drug or medical device can be costly and time-consuming, and approvals might not be granted for future products, or additional indications or uses of existing products, on a timely basis, if at all. Delays in the receipt of, or failure to obtain approvals for, future products, or new indications and uses, could result in delayed realization of product revenues, reduction in revenues and substantial additional costs. We may continue to experience similar delays. No assurance can be given that we will remain in compliance with applicable FDA and other regulatory requirements once approval or marketing authorization has been obtained for a product.
Additionally, our research and development, laboratory, and manufacturing facilities are subject to ongoing regulation, including periodic inspection by the FDA in the U.S., the EMA in the EU, and other regulatory authorities, and we must incur expense and expend significant effort to maintain adequate controls over our operations and ensure compliance with complex regulations. Following an inspection or other inquiry by or interaction with the regulator, regulatory agencies have in the past and may in the future issue a notice listing conditions that are believed to violate cGMP or other laboratory, clinical, or manufacturing regulations, or take other regulatory action, including issuing a warning letter for violations of “regulatory significance” that may result in enforcement actions if not promptly and adequately corrected. In recent years, regulatory agencies around the world have increased their scrutiny of pharmaceutical companies, and our R&D and manufacturing facilities, as well as those of our vendors and manufacturing partners, have also been the subject of increased regulatory oversight, leading to increased expenditures required to ensure compliance with new or more stringent
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research, production and quality control regulations. This has resulted in delayed product launches, product recalls, and facility shutdowns, among other measures and remedial actions, to address specific issues. These actions have in the past and may in the future adversely impact our ability to supply various products around the world and to obtain approvals for new products developed and manufactured at the affected facilities. If any regulatory body were to require one or more of our significant facilities to cease or limit production, or to halt the approval of new or pending regulatory applications, our business and reputation could be adversely affected. In addition, because regulatory approval to develop or manufacture a drug is site-specific, the delay and cost of remedial actions or obtaining approval to develop or manufacture at a specific facility could have a material adverse effect on our business, financial condition and results of operations.
In addition, we are subject to regulations in various jurisdictions, including the Federal Drug Supply Chain Security Act in the U.S., the Falsified Medicines Directive in the European Union and many other such regulations in other countries that require us to develop electronic systems to serialize, track, trace and authenticate units of our products through the supply chain and distribution system. Compliance with these regulations may result in increased expenses for us or impose greater administrative burdens on our organization, and failure to meet these requirements could result in fines or other penalties.
Additionally, the enactment of the IRA represents the most significant pharmaceutical pricing reform in the United States to date and includes legislative changes that could lead to greater pricing pressures on our products, which could be material, such as amendments to (i) eliminate the “donut hole” under the Medicare Part D program which began in 2025; (ii) modify the “noninterference” provisions of the Medicare Part D enabling statute to require the U.S. Department of Health and Human Services to set the prices of a subset of drugs and biologics with the highest annual expenditures under Medicare Parts B and D, which included AUSTEDO and AUSTEDO XR effective as of January 1, 2027, and in the future, could include other innovative products and biologics within our portfolio of products; and (iii) impose manufacturer rebates on certain single-source Part B and Part D drugs when prices rise faster than the rate of inflation.
Several states have established prescription drug affordability boards with authority to review high-cost drugs and, in some cases, set upper payment limits similar to IRA pricing mechanisms. Additional state legislatures have considered legislation that would implement similar IRA-like frameworks or adopt federally set prices for state regulated insurance markets. We continue to monitor these legislative developments and evaluate whether any changes to our business practices and operations are necessary in order to comply with such legislative reforms and to advocate for policies that support both innovation and access to high quality medicines for patients. However, we cannot accurately predict the ultimate impact of such legislative developments on our business in the longer term, or whether additional changes in regulatory policies will occur in the future.
Additionally, the U.S. administration may propose policy changes that create additional uncertainty for Teva’s business, such as its executive order from May 2025 titled “Delivering Most-Favored-Nation Prescription Drug Pricing to American Patients”, see “Item 1—Business—Regulation” for more information. These may include new price restrictions on products Teva sells to Medicaid, Medicare or other government purchasers, or other regulatory changes impacting reimbursement or competitive dynamics in multisource markets.
Failure to comply with all applicable regulatory requirements may subject us to operating restrictions and criminal prosecution, monetary penalties and other disciplinary actions, including but not limited to, sanctions, warning letters, product seizures, recalls, fines, injunctions, suspension, shutdown of production, revocation of approvals or the inability to obtain future approvals, or exclusion from future participation in government healthcare programs. Any of these events could disrupt our business and have a material adverse effect on our revenues, profitability and financial condition.
Governmental, regulatory and civil proceedings and litigation which we are, or in the future become, party to may have an adverse impact on our business.
In the ordinary course of our business, we are exposed to lawsuits, claims, proceedings and government investigations that could preclude or delay the commercialization of our products or disrupt our business
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operations. We are currently subject to several governmental and civil proceedings (including civil litigations brought by governmental agencies and/or private plaintiffs) relating to our pricing, marketing, and research and development and manufacturing practices, employment matters, intellectual property, product liability, competition matters, opioids, securities disclosures, financial reporting and accounting practices, corporate governance, contractual relationships with third parties (e.g. customers and suppliers), and environmental matters. These investigations and litigations are costly and involve a significant diversion of management attention. Such proceedings are unpredictable and may develop over lengthy periods of time. An adverse resolution of these proceedings may result in large monetary fines, damages, additional litigation, such as securities and derivative actions, and other non-monetary sanctions and remedies, such as mandated compliance agreements, all of which can be expensive and disruptive to our operations and business, and can impact decisions related to our product offerings and portfolio.
Due to increasing numbers of securities claims over the last several years and related payouts under insurance policies, in addition to increased settlement values in “event-driven” litigation and a growing number of plaintiff shareholder law firms eager to bring claims, premiums and deductibles for insurance, including D&O insurance, have been increasing and some insurers are reducing the number of companies they insure, causing the supply of insurance to lag behind demand. This could increase our premiums, reduce the scope and capacity of our coverage, and adversely affect our ability to maintain and renew our existing insurance policies on favorable terms or at all. While we continue to maintain insurance coverage intended to address certain risks, such coverage may be insufficient to cover claims and losses we face.
Healthcare reforms, and related reductions in pharmaceutical pricing, reimbursement and coverage, by governmental authorities and third-party payers may adversely affect our business.
The continuing increase in expenditures for healthcare has been the subject of considerable government attention almost everywhere we conduct business. Private health insurers and government health authorities continue to seek ways to reduce or contain healthcare costs, including by reducing or eliminating coverage for certain products and lowering reimbursement levels. The focus on reducing or containing healthcare costs has been fueled by controversies, political debate and publicity about prices for pharmaceutical products that some consider excessive, including Congressional and other inquiries into drug pricing, including with respect to our innovative medicines, which could have a material adverse effect on our reputation. In most of the countries and regions where we operate, including the United States, Western Europe, Israel, Russia, certain countries in Central and Eastern Europe and several countries in Latin America, pharmaceutical prices are subject to new government policies designed to reduce healthcare costs, and may be subject to additional regulatory efforts, funding restrictions, legislative proposals, policy interpretations, investigations and legal proceedings regarding pricing practices. These changes frequently adversely affect pricing and profitability and may cause delays in market entry, or decisions to forgo or discontinue development programs for our products. Certain U.S. states have implemented or are considering pharmaceutical price controls or patient access constraints under the Medicaid program, and some jurisdictions have implemented or are considering price-control regimes that would apply to broader segments of their populations that are not Medicaid-eligible. Private third-party payers, such as health plans, increasingly challenge pharmaceutical product pricing, which could result in lower prices, lower reimbursement rates and a reduction in demand for our products.
Under federal law, companies participating in the Medicaid Drug Rebate program must also participate in the Public Health Service’s 340B drug pricing program. See “Item 1—Business—Regulation” above for more information.
The current U.S. administration may propose policy changes that create additional uncertainty for Teva’s business. These may include changes to the level of scrutiny applied by HRSA to enforce 340B program non-compliance, new price restrictions, such as efforts to reduce prescription drug prices by encouraging manufacturers to voluntarily adopt “Most Favored Nation” (MFN) pricing models on products Teva sells to Medicaid, Medicare or other government purchasers, or other regulatory changes impacting reimbursement or competitive dynamics in multisource markets. Additionally, in its June 2024 decision in Loper Bright Enterprises
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v. Raimondo (the “Loper decision”), the U.S. Supreme Court overturned the longstanding Chevron doctrine, under which courts were required to give deference to regulatory agencies’ reasonable interpretations of ambiguous federal statutes. The Loper decision could result in additional legal challenges to regulations and guidance issued by federal agencies applicable to our operations, including those issued by the FDA. Additionally, the Loper decision may result in increased regulatory uncertainty, inconsistent judicial interpretations and other impacts to the agency rulemaking process. We cannot predict which additional measures may be adopted or the impact of current and additional measures on the marketing, pricing and demand for our products, and any such measures could have a material adverse effect on our business, financial condition and results of operations.
Increased purchasing power of entities that negotiate on behalf of Medicare, Medicaid, and private sector beneficiaries may result in increased pricing pressure by influencing the reimbursement policies of third-party payers. Recent healthcare reform legislation, including the enactment of the One Big Beautiful Bill Act (“OBBBA”), will likely reduce the number of insured in Medicaid and the Health Insurance Exchange markets, which may alter utilization patterns and shift negotiating leverage among payers. Increased financial pressure on third-party payers from healthcare reform legislation may have an adverse effect on us by increasing the amount of rebates we pay for coverage of our drugs by Medicaid programs. It is uncertain how current and future reforms, including any new legislation enacted by the U.S. administration, in these areas will influence the future of our business operations and financial condition. In addition, “tender systems” for generic pharmaceuticals have been implemented (by both public and private entities) in a number of significant markets in which we operate, including in some European markets, in an effort to lower prices. Under such tender systems, manufacturers submit bids that establish prices for generic pharmaceutical products. These measures impact marketing practices and reimbursement of drugs and may further increase pressure on reimbursement margins. Certain other countries may consider the implementation of a tender system. Failing to win tenders or our withdrawal from participating in tenders, or the implementation of similar systems in other markets leading to further price declines, could have a material adverse effect on our business, financial position and results of operations.
Public concern over the abuse of opioid medications, increased legal and regulatory action and the nationwide settlement could negatively affect our business.
Certain governmental and regulatory agencies are focused on the abuse of opioid medications in the United States. U.S. federal, state and local governmental and regulatory agencies have conducted and may in the future conduct investigations of us, other pharmaceutical manufacturers and other supply chain participants with regard to the manufacture, sale, marketing and distribution of opioid medications. In June 2023, we consummated a nationwide settlement to resolve claims brought by various states and political subdivisions in connection with our manufacture, marketing, sale and distribution of opioids. The payments required to be made under this settlement agreement and others may have an adverse impact on our operations and cash flows and there is no assurance that we will have the liquidity or other resources necessary to make such payments and provide supplies of naloxone hydrochloride nasal spray (our generic version of Narcan®) in the amounts and at the times required under the terms of our nationwide and other settlements. For further information, see “Opioids Litigation” in note 12b to our consolidated financial statements.
Additionally, we are defending claims and putative class action lawsuits in Canada in relation to the manufacture, sale, marketing and distribution of opioid medications. The loss or settlement of any such claims related to opioids could have a material adverse impact on our liquidity.
In addition to the costs and potential consequences associated with defending the governmental investigations and legal proceedings, legislative, regulatory or industry measures to address the misuse of prescription opioid medications may also affect our business in ways that we are not able to predict. For example, a number of states, including New York, have enacted legislation that requires the payment of assessments or taxes on the sale or distribution of opioid medications in those states.
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Furthermore, we utilize controlled substances in certain of our current products and products in development, and therefore must meet the requirements of the Controlled Substances Act of 1970 and related regulations administered by the DEA in the U.S., as well as the requirements of similar laws and regulations in other countries where we operate, relating to the manufacture, importation, shipment, storage, sale, and use of controlled substances. While we have compliance systems in place, risks associated with these laws and regulations cannot be entirely eliminated by policies and procedures. For example, violations of the Controlled Substances Act of 1970 and related laws and regulations by direct customers (such as distributors and wholesalers), down-stream customers (such as pharmacies) and health-care providers may expose us to liability and penalties and could have a material adverse effect on our business, financial condition, results of operations, cash flows, and/or share price. In addition, prescription drug abuse and the diversion of opioids and other controlled substances are the frequent subject of public attention, including, for example, past media reports over the appropriateness of prescription of medications used to treat attention deficit hyperactivity disorder (ADHD). The occurrence of any of the above risks could have a material adverse effect on our business, financial condition, reputations, results of operations, cash flows or share price.
The pharmaceutical sector is facing increased government scrutiny from competition and pricing authorities around the world, which may expose us to significant damages and commercial restrictions that can materially and adversely affect our business.
We are required to comply with competition laws in the territories where we do business around the world. Compliance with these laws has been the subject of increasing focus and activity by regulatory authorities, both in the United States and Europe, in recent years. Alleged actions by our employees, in violation of such laws, or evolving interpretations of competition law as applicable to certain practices, have exposed us, and may further expose us, to investigations and legal proceedings, which have resulted, and in the future may result, in significant liability for alleged violations of competition laws and material adverse effects on our reputation, business, financial condition and results of operations. We have been and may in the future be subject to investigations, claims and proceedings relating to violations of these competition laws and regulations, such as the Sherman Act. In August 2023, we reached a deferred prosecution agreement with the DOJ to settle certain price-fixing and market allocation charges brought against us in 2020, and in October 2024, we reached a settlement agreement with the DOJ Civil Division to resolve potential False Claims Act claims based on similar allegations. In addition, we are a party to numerous civil claims brought by state officials and private plaintiffs alleging that Teva, together with other pharmaceutical manufacturers, engaged in conspiracies to fix prices and/or allocate market share of generic products in the United States. For further information, see “Government Investigations and Litigation Relating to Pricing and Marketing” in note 12b to our consolidated financial statements. If any investigations, claims or proceedings are adversely determined against us, we may face material adverse effects on our business, including monetary penalties. We have been involved in numerous litigations involving challenges to the validity or enforceability of listed patents (including our own), and therefore settling patent litigations has been and will likely continue to be an important part of our business. There is continued scrutiny of our patent settlements, including from the U.S. Federal Trade Commission (“FTC”) and the European Commission. Accordingly, we may receive formal or informal requests from competition law authorities around the world for information about a particular settlement agreement, and there is a risk that governmental authorities, customers, other downstream purchasers or others may commence actions against us alleging violations of antitrust laws based on our settlement agreements. We are currently defendants in antitrust actions brought by governmental agencies and private plaintiffs involving numerous settlement agreements and, since 2015, we have been subject to a consent decree with the FTC, which imposes on us certain injunctive reliefs with respect to our ability to enter into patent settlements in the United States. The U.S. Congress and certain state legislatures in the United States have also passed, or have proposed passing, legislation that could adversely impact our ability to settle patent litigations. For example, the State of California has enacted legislation that creates a presumption, with certain exceptions and safe harbors, that various types of patent litigation settlements are anti-competitive, and imposes substantial monetary penalties on companies and individuals who do not comply. The enforcement of this law has been enjoined on constitutional grounds, but the
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State has appealed that injunction, and such legislation still creates a risk of significant potential exposure for settling patent litigations and, in turn, makes it more difficult to settle in the first place, which could have a material adverse effect on our business.
Following calls in recent years from policy makers and other stakeholders in many countries for governmental intervention to address the high prices of certain pharmaceutical products, we have been in the past, and may in the future be, subject to governmental investigations, claims or other legal or regulatory actions regarding our pricing and/or other alleged exclusionary practices. These include, among others, U.S. Congressional investigations regarding both our innovative medicines and generic medicines, the European Commission’s proceedings related to COPAXONE with the recent decision by the European Commission from October 31, 2024, and litigation concerning the U.K. Competition and Markets Authority’s inquiry regarding hydrocortisone. Additionally, in June 2024, Teva received a civil investigative demand from the FTC, seeking documents and information related to patents listed in the Orange Book in connection with certain of the Company’s inhaler products, which followed letters sent by the FTC in November 2023 and April 2024, notifying Teva and other pharmaceutical companies as well as the FDA, under 21 CFR 314.53, that in the FTC’s view, certain of our and other pharmaceutical companies’ patents have been improperly listed in the Orange Book, resulting in potential delays to generic competition, and subsequently, certain members of the U.S. Congress expressed similar concerns of the FTC. Any such investigation may have a material adverse effect on our reputation, business, financial condition and results of operations. For further information, see “Competition Matters” and “Government Investigations and Litigation Relating to Pricing and Marketing” in note 12b to our consolidated financial statements.
Third parties may claim that we infringe their intellectual property rights and we may have sold or may in the future elect to sell products prior to the final resolution of outstanding intellectual property litigation, and, as a result, we may be prevented from manufacturing and selling some of our products and could be subject to liability for damages in the United States, Europe and other markets where we do business.
Our ability to introduce new products depends in part upon the success of our challenges to patent rights held by third parties or our ability to develop non-infringing products. Based upon a variety of legal and commercial factors, we may elect to sell a product even though patent litigation is still pending, either before any court decision is rendered or while an appeal of a lower court decision is pending. The outcome of such patent litigation could, in certain cases, materially adversely affect our business. For further information, see “Intellectual Property Litigation” in note 12b to our consolidated financial statements.
If we sell products prior to a final court decision, and such decision is adverse to us, we could be required to cease selling the infringing products, causing us to lose future sales revenue from such products and we could face substantial liabilities for patent infringement, in the form of either payment for the patentee’s lost profits or a royalty on our sales of the infringing products. These damages may be significant and could materially adversely affect our business. In the United States, in the event of a finding of willful infringement, the damages assessed may be up to three times the profits lost by the patent owner. Because of the discount pricing typically involved with generic pharmaceutical products, patented brand products generally realize a significantly higher profit margin than generic pharmaceutical products. As a result, the damages assessed may be significantly higher than our profits. In addition, even if we do not owe money damages, we may incur significant legal and related expenses in the course of successfully defending against infringement claims.
We may be susceptible to significant product liability claims that are not covered by insurance.
Our business inherently exposes us to claims for injuries, including both physical injuries and/or related economic losses, allegedly resulting from the use of our products. As our portfolio of available products expands, particularly with new innovative medicines, we may experience increases in product liability claims asserted against us.
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We maintain an insurance program, including commercial insurance, self-insurance (including direct risk retention), or a combination of both approaches, in amounts and on terms that we believe are reasonable and prudent in light of our business and related risks. We sell, and will continue to sell, pharmaceutical products that are not covered by product liability insurance. In addition, we may be subject to claims for which insurance coverage is denied, as well as claims that exceed our policy limits. Product liability coverage for pharmaceutical companies is becoming more expensive and increasingly difficult to obtain. As a result, we have in the past not been, and may in the future not be, able to obtain the precise type and amount of insurance we desire, or any insurance on reasonable terms, in the markets in which we operate. For further information see “Product Liability Litigation” in note 12b to our consolidated financial statements.
Any failure to comply with the complex reporting and payment obligations under the Medicare and Medicaid programs may result in further litigation or sanctions, in addition to those that we have announced in previous years.
The U.S. laws and regulations regarding Medicare and/or Medicaid reimbursement and rebates and other governmental programs are complex. Some of the applicable laws may impose liability (and possible exclusion from Medicare, Medicaid and other programs), even in the absence of specific intent to defraud. The subjective decisions and complex methodologies used in making calculations under these programs are subject to review and challenge, and it is possible that such reviews could result in material changes. In August 2020, the U.S. Attorney’s office in Boston, Massachusetts brought a civil action in the U.S. District Court for the District of Massachusetts against Teva, alleging that Teva’s donations to certain 501(c)(3) charities that provided financial assistance to multiple sclerosis patients violated the Anti-Kickback Statute. On October 10, 2024, Teva entered into a settlement agreement with the DOJ to resolve these claims, pursuant to which Teva will pay $425 million over six years. In addition, we are notified from time to time of governmental investigations regarding drug reimbursement or pricing issues. For further information, see “Government Investigations and Litigation Relating to Pricing and Marketing” in note 12b to our consolidated financial statements. Certain parts of Medicare benefits are under scrutiny, as the U.S. Congress looks for ways to reduce government spending on prescription medicines.
Sanctions and trade control laws create the potential for significant liabilities, penalties and reputational harm.
As a company with global operations, we are subject to national laws as well as international treaties and conventions controlling imports, exports, re-export, transfer and diversion of goods (including finished goods, materials, APIs, packaging materials, other products and machines), services and technology. These include import and customs laws, export controls, trade embargoes and economic sanctions, restrictions on sales to parties that are listed on (or are owned or controlled by one or more parties listed on) denied party watch lists and anti-boycott measures (collectively “Sanctions and Trade Controls”). Applicable Sanctions and Trade Controls are administered by Israel’s Ministry of Finance, the U.S. Treasury’s Office of Foreign Assets Control, the U.S. Department of Commerce, other U.S. agencies, the Council of the European Union, and multiple other agencies of other jurisdictions around the world where we do business. Sanctions and Trade Controls relate to a number of aspects of our business, including most notably the sales of finished goods and API. Compliance with Sanctions and Trade Controls has been the subject of increasing focus and activity by regulatory authorities, especially in the United States and the EU, in recent years, and requirements under applicable Sanctions and Trade Controls in general, change frequently. Sanctions and Trade Controls imposed with respect to the ongoing conflict between Russia and Ukraine have been particularly dynamic and future geopolitical conflicts involving other jurisdictions may result in further changes to the sanctions environment. Any such changes to the sanctions environment may require us to withdraw from or limit our exposure to certain markets or to terminate certain business relationships in order to remain in compliance with applicable laws. Although we have policies and procedures designed to address compliance with Sanctions and Trade Controls, actions by our employees, by third-party intermediaries (such as distributors and wholesalers) or others acting on our behalf in violation of relevant laws and regulations, may expose us to liability and penalties for violations of Sanctions and Trade Controls and accordingly may have a material adverse effect on our reputation and our business, financial condition and results of operations.
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Our failure to comply with applicable environmental, health and safety laws and regulations worldwide could adversely impact our business and results of operations.
We are subject to laws and regulations concerning the environment, safety matters, regulation of chemicals and product safety in the countries where we manufacture and sell our products or otherwise operate our business. These requirements include regulation of the handling, manufacture, transportation, storage, use and disposal of materials, including the direct and indirect discharge of pollutants and pharmaceutical residues into the environment. In addition, in November 2024, the European Union adopted revisions to the Urban Wastewater Treatment Directive that requires pharmaceutical companies to pay for a majority of the costs to remove micropollutants from wastewater and its proportional share of costs to collect and verify data on their products and other costs, based on the quantities of a relevant substance in the products the company places on the market and the hazardousness of those substances. Compliance with such laws and regulations will require ongoing, potentially increasing, compliance-related costs and, if we fail to comply with these laws and regulations, we may be subject to substantial fines and penalties, enforcement actions, mandatory corrective actions and/or legal proceedings. In the normal course of our business, we are also exposed to risks relating to possible releases of hazardous substances into the environment, which could cause environmental or property damage or personal injuries, and which could require remediation, including of contaminated soil and/or groundwater, or replacement of equipment. Under certain laws, we may be required to remediate contamination at certain properties, regardless of whether the contamination was caused by us or by previous occupants or users of the property. Further, changes in laws or regulations with respect to the use and/or presence of per- and polyfluoroalkyl substances (PFAS) in our products or the components used in the research, development, manufacture and/or packaging of our products could disrupt or restrict our ability to develop, produce or sell our products in the affected jurisdictions, potentially resulting in a material adverse effect on our business. Climate change, and evolving laws, regulations and policies regarding climate change, could also pose additional legal or regulatory requirements related to greenhouse gas (“GHG”) emissions and climate risk reporting, carbon pricing, cap-and-trade programs, carbon taxes and mandatory reduction targets. These more stringent requirements could, among other things, increase our costs of sourcing, production, and transportation, as well as have negative reputational impacts if we fail to meet such requirements. The consequences of climate change, such as extreme weather and water scarcity, could pose risks to our facilities and disruption of our activities, and any failure to respond to risks regarding climate change may have a material adverse effect on our business, financial condition, results of operations and reputation.
Natural disasters and extreme weather events resulting from climate change, such as floods, heatwaves, blizzards, hurricanes, wildfires, the rise of sea level, and water stress, could impact our business activities and our ability to deliver our products to customers. We evaluate these risks in our supply planning, loss prevention and business continuity planning. Additionally, our manufacturing operations involve handling chemicals, pressurized systems, and complex equipment, which expose us to inherent health and safety risks. These include potential accidents, fires, explosions, chemical spills, and employee exposure to hazardous substances. Any such incident could result in serious injury, loss of life, property damage, regulatory investigations, and significant operational disruptions. The implementation of an Environmental, Health and Safety Management System across our facilities has resulted in the development of processes to prepare and respond to a range of emergencies that may occur. If our planning and risk management regarding natural disasters, extreme weather events and other health and safety matters fail, our facilities could be impacted and our activities could be significantly disrupted.
We are subject to changes in governmental, investor and societal responses to climate change and sustainability-related issues, which may result in scrutiny or adverse impacts on our business.
Recent changes to investor and governmental approaches to climate change and sustainability-related issues have led to evolving and sometimes conflicting expectations and standards. From time to time, we announce certain initiatives, including goals or commitments, regarding our sustainability focus areas, which include environmental matters, sustainable procurement, health equity and access to medicines, compliance and integrity and I&D. We could be criticized for the scope of such initiatives or goals or commitments, or perceived as not
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acting responsibly or far enough in connection with these matters or other sustainability-related topics. We could also fail, or be perceived to fail to achieve our initiatives or goals, whether described in our announcements, our annual Healthy Future (Sustainability) report or otherwise, or we could fail to accurately report our progress on such initiatives and goals. Such failures could be due to changes in our business or evolving regulations in the countries in which we operate or technical challenges, and any such failures or perceived failures could expose us to negative impacts, including government enforcement actions, private litigation or loss of business. We have also issued sustainability-linked senior notes with targets that include improving access to medicines in low- and middle-income countries and reducing GHG emissions, and failure to achieve such targets could negatively impact our reputation and also result in increased payments to holders of such senior notes.
Furthermore, there are a number of evolving sustainability-related regulatory disclosure regulations with which Teva may have to comply. For example, in October 2023, California enacted the Climate Corporate Data Accountability Act (“SB 253”) and Climate-Related Financial Risk Act (“SB 261”) that will require certain companies that (i) do business in California to publicly disclose their Scopes 1, 2 and 3 greenhouse gas emissions, with third party assurance of such data, and issue public reports on their climate-related financial risk and related mitigation measures and (ii) operate in California and make certain climate-related claims to provide disclosures around the achievement of climate-related claims, including the use of voluntary carbon credits to achieve such claims. SB 253 and SB 261 are subject to litigation, and, in one of the lawsuits, an injunction was issued in November 2025 barring enforcement of SB 261 while the litigation proceeds; the law could be reinstated. In addition, in December 2022, the European Union adopted Directive No 2464/2022 on Corporate Sustainability Reporting (“CSRD”). The CSRD introduces detailed sustainability reporting obligations, requiring in-scope companies to make sustainability reports in accordance with the European Sustainability Reporting Standards (“ESRS”), which include certain mandatory disclosures and other voluntary disclosures on impacts, risks, and opportunities in relation to sustainability matters identified as material by the relevant entity under applicable rules. Teva expects to first have to disclose pursuant to the CSRD, in accordance with the ESRS, in 2028. Furthermore, Article 8 of Regulation (EU) 2020/852 (EU Taxonomy) requires those in-scope companies to report how and to what extent their activities are associated with economic activities that qualify as environmentally sustainable defined herein. These disclosure obligations may lead to increased compliance burdens and costs and result in the disclosure of information that may have a negative impact on our operations and reputation; however, under the EU’s omnibus simplification initiative, the CSRD, ESRS and Taxonomy Regulation are currently under revision to simplify applicable obligations, and this process may reduce compliance burdens, although the final outcome of the legislative process remains uncertain.
In addition to regulatory disclosures, there are a number of sustainability-related regulations requiring the implementation of certain due diligence processes and internal compliance systems in relation to a range of human rights and environmental matters with which Teva may have to comply (collectively, “Sustainability Due Diligence Laws”). For example, a number of jurisdictions have passed or proposed mandatory due diligence requirements in relation to forced labor and human rights matters across corporate groups as well as entity levels and supply chains, some of which have been subject to simplification and postponement. In the European Union, these include the Directive (EU) 2024/1760 on corporate sustainability due diligence, Regulation (EU) 2023/1115 on the making available in the EU and the export from the EU of certain commodities and products associated with deforestation and forest degradation and Regulation (EU) 2024/3015 on prohibiting products made with forced labor on the EU market. Compliance with Sustainability Due Diligence Laws of this nature may require the development or update of internal compliance and enterprise risk management policies and related procedures; assigning board and/or management oversight as well as day-to-day operational responsibility for in-scope human rights and environmental matters; implementation of periodic compliance risk assessments; updates to contractual frameworks and agreements; the development of preventative and/or corrective action plans; changes to purchasing, design, and distribution practices, where relevant; and the development or update of notification mechanisms and complaints procedures. The compliance burden and related costs may increase over time. Failure to comply with applicable Sustainability Due Diligence Laws may lead to investigations and audits, fines, exclusion from public procurement, other enforcement action or liabilities, including civil liability or liability from third-party claims, and reputational damage.
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Risks related to our financial condition
Because we have substantial international operations, our sales, profits and cash flow may be adversely affected by currency fluctuations and restrictions as well as credit risks.
Fluctuations in exchange rates between the currencies in which we operate in, and the U.S. dollar, may have a material adverse effect on our results of operations, the value of balance sheet items denominated in foreign currencies and our financial condition.
In 2025, approximately 43% of our revenues were denominated in currencies other than the U.S. dollar. As a result, we are subject to significant foreign currency risks, including repatriation restrictions in certain countries, and may face heightened risks as we enter new markets. A substantial portion of our sales, particularly in Latin America, Central and Eastern European countries and Asia, are recorded in local currencies, which exposes us to the direct risk of devaluations, hyperinflation or exchange rate fluctuations. In addition, although the majority of our operating costs are recorded in, or linked to, the U.S. dollar, in 2025, we incurred a substantial amount of operating costs in currencies other than the U.S. dollar, which only partially offset the currency risk derived from our sales in non-U.S. dollars. Moreover, fluctuations in the U.S. dollar relative to other currencies in which we operate, have in the past and may in the future, materially impact our revenues, results of operations, profitability and cash flows. We use derivative financial instruments and “hedging” techniques, such as issuance of debt in non-U.S. dollar currencies, to manage our balance sheet and income statement exposure to currency exchange rate fluctuations in the major foreign currencies in which we operate. However, not all of our potential exposure is covered, and some elements of our consolidated financial statements, such as our equity position, are not protected against foreign currency exposures. Therefore, our exposure to exchange rate fluctuations could have a material adverse effect on our financial results.
The imposition of price controls or restrictions on the conversion of foreign currencies could also have a material adverse effect on our financial results. In addition, operating internationally exposes us to credit risks of customers and other counterparties in a number of jurisdictions. Some of these customers and other counterparties may have lesser creditworthiness than others and the legal system for enforcing collections in such jurisdictions may be less well-developed.
Our long-lived assets may continue to lead to significant impairments in the future.
We regularly review our long-lived assets, including identifiable intangible assets, goodwill and property, plant and equipment, for impairment. Goodwill and acquired indefinite life intangible assets are subject to impairment review on an annual basis and whenever potential impairment indicators are present. Other long-lived assets are reviewed when there is an indication that impairment may have occurred. See notes 6 and 7 to our consolidated financial statements, for descriptions of impairments of intangible assets and goodwill in recent periods.
The amount of goodwill, identifiable intangible assets and property, plant and equipment on our consolidated balance sheet may increase following acquisitions or other collaboration agreements. Changes in market conditions, including further increases in discount rates, exchange rate fluctuations, or other changes may lead to further impairments in the future. In addition, the potential divestment of assets, including the closure or divestment of manufacturing plants and R&D facilities, headquarters and other office locations, may lead to additional impairments. Future events or decisions may lead to asset impairments and/or related charges. For assets that are not impaired, we may adjust the remaining useful lives. Certain non-cash impairments may result from a change in our strategic goals, business direction or other factors relating to the overall business environment. Any significant impairment could have a material adverse effect on our results of operations.
Our tax liabilities could be larger than anticipated.
We are subject to tax in many jurisdictions, and significant judgment is required in determining our provision for income taxes. Likewise, we are subject to audit by tax authorities in many jurisdictions. In such
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audits, our interpretation of tax legislation may be challenged and tax authorities in various jurisdictions may disagree with, and subsequently challenge, the amount of profits taxed in such jurisdictions under our inter-company agreements.
Although we believe our estimates are reasonable, the ultimate outcome of such audits and related litigation could be different from our provision for taxes and may have a material adverse effect on our consolidated financial statements and cash flows. For additional information see note 13 to our consolidated financial statements.
On December 12, 2022, the EU Council announced that EU member states had reached an agreement to implement the minimum taxation component of 15% (“Pillar Two”) of the OECD’s reform of international taxation, as part of the base erosion and profit shifting (“BEPS”) for large multinational corporations. Other countries have also enacted legislation effective as early as January 1, 2024 with general implementation of a global minimum tax by January 1, 2025, or are expected to enact such legislation in the future. Although, the impact of Pillar Two on our 2025 consolidated financial statements was not material on our effective tax rate, it could have a material impact on our effective tax rate and consolidated financial statements in the future.
On July 4, 2025, the OBBBA was signed into law in the United States, introducing significant changes to U.S. corporate tax rules. The Act includes provisions affecting the deductibility of interest expense for U.S. federal tax purposes, the treatment of research and development costs and other depreciable property, and the taxation of foreign subsidiaries’ earnings, among other changes to U.S. corporate tax law. Under ASC 740, changes in tax rates and tax law must be recognized in the period in which the legislation is enacted. While we have evaluated the impact of this Act on our consolidated financial statements and related disclosures and it does not have a material effect on our 2025 consolidated financial statements, the ultimate impact of these provisions may differ from our estimates. Future interpretations, regulatory guidance, or changes in our business operations could result in increased tax liabilities, reduced deductions, or other adverse effects on our effective tax rate and financial condition.
The termination or expiration of governmental programs or tax benefits, or a change in our business, could adversely affect our overall effective tax rate.
Our tax expenses and the resulting effective tax rate reflected in our consolidated financial statements may increase over time as a result of changes in corporate income tax rates, other changes in the tax laws of the various countries in which we operate, such as the recent enactments by both the European Union and non-European Union countries of a global minimum tax, or changes in our product mix or the mix of countries where we generate profit. We have benefited, and currently benefit, from a variety of government programs and tax benefits that generally carry conditions that we must meet in order to be eligible to obtain such benefits. If we fail to meet the conditions upon which certain favorable tax treatment is based, we would not be able to claim future tax benefits and could be required to refund tax benefits already received. Additionally, some of these programs and the related tax benefits are available to us for a limited number of years, and these benefits expire from time to time.
Any of the following could have a material effect on our overall effective tax rate: some government programs may be discontinued, or the applicable tax rates may increase; we may be unable to meet the requirements for continuing to qualify for some programs and certain restructuring activities have led and may lead to the loss of certain tax benefits we currently receive; these programs and tax benefits may be unavailable at their current levels; upon expiration of a particular benefit, we may not be eligible to participate in a new program or qualify for a new tax benefit that would offset the loss of the expiring tax benefit; or we may be required to refund previously recognized tax benefits if we are found to be in violation of the stipulated conditions.
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Failure to maintain effective internal control over financial reporting could have a material adverse effect on our ability to report our financial condition, results of operations, or cash flows accurately and on a timely basis and could harm our reputation.
As a publicly traded company, we are subject to the Securities Exchange Act of 1934 (the “Exchange Act”) and the Sarbanes-Oxley Act of 2002 (“Sarbanes-Oxley Act”). The Sarbanes-Oxley Act requires that we evaluate the effectiveness of our disclosure controls and procedures and internal control over financial reporting, and the accuracy of our financial reporting is dependent on the effectiveness of our internal controls. Our internal controls are subject to risk as a result of interpretations, assumptions and estimates in our financial reporting and accounting practices such as changes in our segment reporting. If the interpretations, estimates or judgments we use to prepare our financial statements prove to be incorrect, we may be required to restate our financial results, which could have a number of material adverse effects on us. In addition, any failure to maintain effective internal control over financial reporting or implement required new or improved controls could result in our inability to meet our public reporting requirements on a timely basis and properly report our financial results, a restatement of our financial statements and/or harm to our reputation, any of which could materially adversely affect our results of operations. For a discussion of our internal control over financial reporting, see “Part II, Item 9A. Controls and Procedures” of this Annual Report on Form 10-K.
Risks related to equity ownership
Shareholder rights and responsibilities as a shareholder are governed by Israeli law, which differs in some material respects from the rights and responsibilities of shareholders of U.S. companies.
The rights and responsibilities of the holders of our ordinary shares are governed by our articles of association and by Israeli law. These rights and responsibilities differ in some material respects from the rights and responsibilities of shareholders of U.S. corporations. In particular, a shareholder of an Israeli company has a duty to act in good faith and in a customary manner in exercising his or her rights and performing his or her obligations towards the company and other shareholders, and to refrain from abusing his or her power in the company, including, among other things, in voting at a general meeting of shareholders on matters such as amendments to a company’s articles of association, increases in a company’s authorized share capital, mergers and acquisitions and related party transactions requiring shareholder approval. In addition, a shareholder shall refrain from depriving other shareholders, and a shareholder who is aware that it possesses the power to determine the outcome of a shareholder vote or to appoint or prevent the appointment of a director or executive officer in the company has a duty of fairness toward the company. These provisions may be interpreted to impose additional obligations and liabilities on holders of our ordinary shares that are not typically imposed on shareholders of U.S. corporations.
Provisions of Israeli law and our articles of association may delay, prevent or make difficult an acquisition of us, prevent a change of control and negatively impact our share price.
Israeli corporate law regulates acquisitions of shares through tender offers and mergers, requires special approvals for transactions involving directors, officers or significant shareholders, and regulates other matters that may be relevant to these types of transactions. Furthermore, Israeli tax considerations may make potential acquisition transactions unappealing to us or to some of our shareholders. For example, Israeli tax law may subject a shareholder who exchanges his or her ordinary shares for shares in a foreign corporation to taxation before disposition of the investment in the foreign corporation. These provisions of Israeli law may delay, prevent or make difficult an acquisition of our company, which could prevent a change of control and, therefore, depress the price of our shares. In addition, our articles of association contain certain provisions that may make it more difficult to acquire us, such as provisions that provide for a classified board of directors and that our Board of Directors may issue preferred shares. These provisions may have the effect of delaying or deterring a change in control of us, thereby limiting the opportunity for shareholders to receive a premium for their shares and possibly affecting the price that some investors are willing to pay for our securities.
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Our American Depositary Shares (“ADSs”) and ordinary shares are traded on different stock exchanges and this may result in price variations.
Our ADSs have been traded in the United States since 1982, and on the New York Stock Exchange (the “NYSE”) since 2012, and our ordinary shares have been listed on the TASE since 1951. Trading in our securities on these markets takes place in different currencies (our ADSs are traded in U.S. dollars and our ordinary shares are traded in New Israeli Shekels), and at different times (resulting from different time zones, different trading days and different public holidays in the United States and Israel). As a result, the trading prices of our securities on these two markets may differ due to these factors. In addition, any decrease in the price of our securities on one of these markets could cause a decrease in the trading price of our securities on the other market.
It may be difficult to enforce non-Israeli judgments in Israeli courts against us, our officers and our directors.
We are incorporated in Israel. Certain of our executive officers and directors and our outside auditors are not residents of the United States, and a substantial portion of our assets and the assets of these persons are located outside the United States. Therefore, it may be difficult for an investor, or any other person or entity, to file or enforce an action against us or any of those persons under non-Israeli law in an Israeli court. In addition, an Israeli court may be deemed forum non conveniens for such legal proceedings. It may also be difficult to effect service of process on these persons in the United States, Europe or elsewhere.
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Business Segment |
Number of Facilities |
Square Feet (in thousands) |
||||||
United States |
10 | 1,891 | ||||||
Europe |
23 | 8,878 | ||||||
International Markets |
20 | 5,323 | ||||||
Worldwide Total Manufacturing and R&D Facilities |
53 | 16,092 | ||||||
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PART II
ITEM 5. MARKET FOR THE COMPANY’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
American Depositary Shares (“ADSs”)
Our ADSs, which have been traded in the United States since 1982, were admitted to trade on the Nasdaq National Market in October 1987 and were subsequently traded on the Nasdaq Global Select Market. On May 30, 2012, we transferred the listing of our ADSs to the New York Stock Exchange (the “NYSE”). The ADSs are quoted under the symbol “TEVA.” Citibank, N.A. serves as depositary for the ADSs. Each ADS represents one ordinary share.
Various other stock exchanges quote derivatives and options on our ADSs under the symbol “TEVA.”
Ordinary Shares
Our ordinary shares have been listed on the Tel Aviv Stock Exchange (“TASE”) since 1951.
Holders
The number of record holders of ADSs at December 31, 2025 was 1,604.
The number of record holders of ordinary shares at December 31, 2025 was 134.
The number of record holders is based upon the actual number of holders registered on our books at such date and does not include holders of shares in “street names” or persons, partnerships, associations, corporations or other entities identified in security position listings maintained by depository trust companies.
Dividends
We have not paid dividends on our ordinary shares or ADSs since December 2017.
Unregistered Sales of Equity Securities and Use of Proceeds
None.
Repurchase of Shares
We did not repurchase any of our shares during the year ended December 31, 2025. Under applicable Israeli corporate law, a share repurchase is considered a distribution and is subject to the applicable statutory tests and limitations, related to a company’s profits and solvency capabilities. Pursuant to a recent amendment in applicable corporate law regulations, companies whose shares are listed abroad (including dual-listed companies such as Teva) may benefit from certain relief with respect to the procedures to be taken in connection with share repurchases. Decisions regarding any future share repurchases will depend on certain factors, such as market conditions, share price and other opportunities to invest capital for growth in alignment with the Company’s Pivot to Growth strategy, and are subject to the approval by Teva’s Board of Directors.
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Performance Graph
Set forth below is a performance graph comparing the cumulative total return (assuming reinvestment of dividends), in U.S. dollars, for the calendar years ended December 31, 2021, 2022, 2023, 2024 and 2025, of $100 invested on December 31, 2020 in the Company’s ADSs, the Standard & Poor’s 500 Index and the Dow Jones U.S. Pharmaceuticals Index.
| * | $100 invested on December 31, 2020 in stock or index – including reinvestment of dividends. Indexes calculated on month-end basis. |
ITEM 6. [RESERVED]
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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Business Overview
We are a biopharmaceutical company, enabled by a world-class generics business. For over 120 years, our commitment to bettering health has never wavered. From innovating in the fields of neuroscience and immunology to providing complex generic medicines, biosimilars and pharmacy brands worldwide, we are dedicated to addressing patients’ needs, now and in the future.
We operate worldwide, with headquarters in Israel and a significant presence in the United States, Europe and many other markets around the world. Today, our global network of capabilities consists of approximately 34,000 employees across 57 markets.
Teva was incorporated in Israel on February 13, 1944 and is the successor to a number of Israeli corporations, the oldest of which was established in 1901.
Our Business Segments
We operate our business through three segments: United States, Europe and International Markets. Each business segment manages our entire product portfolio in its region, including generics, which includes biosimilars and OTC products, as well as innovative medicines. This structure enables strong alignment and integration between operations, commercial regions, R&D and our global marketing and portfolio function, optimizing our product lifecycle across therapeutic areas.
In addition to these three segments, we have other activities, primarily the sale of API to third parties, certain contract manufacturing services and an out-licensing platform offering a portfolio of products to other pharmaceutical companies through our affiliate Medis.
Pivot to Growth Strategy
In 2025, we continued to execute on the four key pillars of our “Pivot to Growth” strategy, announced in May 2023. As part of this strategy, in 2025, we entered the strategy’s “Accelerate Growth” phase, during which we focus on growing our innovative portfolio, aligning capital allocation to invest in activities we expect to have the highest value, and modernizing our organization and operations to drive both efficiency and cost savings. For additional information on our Pivot to Growth strategy, see “Item 1—Business—Pivot to Growth Strategy.”
Macroeconomic Environment
In recent years, the global economy has been impacted by fluctuating foreign exchange rates. A significant portion of our revenues is denominated in currencies other than the U.S. dollar and we manufacture many of our products outside of the United States. As a result, fluctuations in the U.S. dollar relative to other currencies in which we operate have in the past and may in the future materially impact our revenues, results of operations, profitability and cash flows. In addition, in many of the markets in which we operate, we have experienced elevated inflation in recent years, contributing to higher interest rates. In other markets, such as the EU, inflation has recently declined, resulting in lower interest rates. Although inflationary and other macroeconomic pressures have and may continue to ease, the higher costs we have incurred in recent periods have already affected our operations and are likely to continue influencing our financial results. Recent U.S. tariffs imposed or threatened to be imposed on materials and products from countries where we do business and any responsive or reciprocal actions taken by such countries could impact our costs and our global operations. The countries subject to tariffs and the tariff rate imposed on each country is uncertain and dynamic, and we continue to monitor and assess the potential impact on our supply chain and global operations.
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The pharmaceutical industry has also experienced disruptions in global supply chains, including our own supply chain, due to geopolitical tensions and other factors. In some cases, such disruptions have resulted in and may continue to result in delays in our production and distribution processes, impacting product availability and our ability to timely respond to consumer demand. We have taken measures and are continually considering various initiatives, including, enhanced inventory management, alternative sourcing strategies, and backup production plans for key products, to allow us to partially mitigate and offset the impact of these factors.
Highlights
Significant highlights of 2025 included:
| • | Our revenues in 2025 were $17,258 million, an increase of 4% in U.S. dollars, or 3% in local currency terms, compared to 2024. This increase was mainly due to higher revenues from our key innovative products AUSTEDO, AJOVY and UZEDY, and from development milestone payments received in connection with the initiation of Phase 3 studies for duvakitug (anti-TL1A), partially offset by lower revenues from our International Markets segment due to the divestment of our business venture in Japan, from certain other innovative products across all our segments, lower proceeds from the sale of certain product rights and from generic products in our Europe segment. |
| • | Our United States segment generated revenues of $9,186 million and profit of $3,356 million in 2025. Revenues increased by 14% and profit increased by 46% compared to 2024. |
| • | Our Europe segment generated revenues of $5,040 million and profit of $1,303 million in 2025. Revenues decreased by 1% in U.S. dollars, or 5% in local currency terms, compared to 2024. Profit decreased by 17% compared to 2024. |
| • | Our International Markets segment generated revenues of $2,162 million and profit of $336 million in 2025. Revenues decreased by 12% in U.S. dollars, or 11% in local currency terms, compared to 2024. Profit decreased by 24% compared to 2024. |
| • | Our revenues from other activities in 2025 were $870 million, a decrease of 8% in U.S. dollars, or 10% in local currency terms, compared to 2024. |
| • | Exchange rate movements during 2025, net of hedging effects, positively impacted our revenues by $152 million, compared to 2024. |
| • | Gross profit margin was 51.8% in 2025, compared to 48.7% in 2024. |
| • | R&D expenses, net in 2025 were $1,013 million, an increase of 2% compared to $998 million in 2024. |
| • | We recorded expenses of $1,050 million for other asset impairments, restructuring and other items in 2025, compared to expenses of $1,388 million in 2024. |
| • | We recorded expenses of $467 million in legal settlements and loss contingencies in 2025, compared to expenses of $761 million in 2024. |
| • | Operating income was $2,157 million in 2025, compared to operating loss of $303 million in 2024. |
| • | Financial expenses, net were $934 million in 2025, compared to $981 million in 2024. |
| • | In 2025, we recognized a tax benefit of $180 million on a pre-tax income of $1,223 million. In 2024, we recognized a tax expense of $676 million on a pre-tax loss of $1,284 million. |
| • | Our debt was $16,807 million as of December 31, 2025, compared to $17,783 million as of December 31, 2024. |
| • | Cash flow generated from operating activities in 2025 was $1,649 million, compared to $1,247 million in 2024. The increase in 2025 resulted mainly from development milestone payments received in connection with the initiation of Phase 3 studies for duvakitug (anti-TL1A), partially offset by higher legal settlement payments. Net changes in working capital items were neutral. |
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| • | During 2025, we generated free cash flow of $2,396 million, which we define as comprising $1,649 million in cash flow generated from operating activities, $1,214 million in beneficial interest collected in exchange for securitized accounts receivables (under our EU securitization program) and $34 million in proceeds from divestitures of businesses and other assets, partially offset by $501 million in cash used for capital investments. During 2024, we generated free cash flow of $2,068 million. The increase in 2025 resulted mainly from higher cash flow generated from operating activities. |
Results of Operations
The discussion that follows includes a comparison of our results of operations and liquidity and capital resources for fiscal years 2025 and 2024. For a comparison of our results of operations and financial condition for fiscal years 2024 and 2023, see “Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our 2024 Annual Report on Form 10-K, filed with the SEC on February 5, 2025.
Segment Information
United States Segment
The following table presents revenues, expenses and profit for our United States segment for the past two years:
| Year ended December 31, | ||||||||||||||||
| 2025 | 2024 | |||||||||||||||
| (U.S. $ in millions /% of Segment Revenues) | ||||||||||||||||
| Revenues |
$ | 9,186 | 100% | $ | 8,034 | 100% | ||||||||||
| Cost of sales |
3,568 | 38.8% | 3,646 | 45.4% | ||||||||||||
| Gross profit |
5,618 | 61.2% | 4,388 | 54.6% | ||||||||||||
| R&D expenses |
633 | 6.9% | 633 | 7.9% | ||||||||||||
| S&M expenses |
1,172 | 12.8% | 1,049 | 13.1% | ||||||||||||
| G&A expenses |
458 | 5.0% | 410 | 5.1% | ||||||||||||
| Other loss (income) |
§ | § | § | § | ||||||||||||
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| Segment profit* |
$ | 3,356 | 36.5% | $ | 2,296 | 28.6% | ||||||||||
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| * | Segment profit does not include amortization and certain other items. |
| § | Represents an amount less than $0.5 million or 0.5%, as applicable. |
United States Revenues
Revenues from our United States segment in 2025 were $9,186 million, an increase of $1,152 million, or 14%, compared to 2024, mainly due to higher revenues from our key innovative products AUSTEDO, AJOVY, and UZEDY, development milestone payments received in connection with the initiation of Phase 3 studies for duvakitug (anti-TL1A), as well as higher revenues from generic products (including biosimilars).
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Revenues by Major Products and Activities
The following table presents revenues for our United States segment by major products and activities for the past two years:
| Year ended December 31, | Percentage Change 2025-2024 |
|||||||||||
| 2025 | 2024 | |||||||||||
| (U.S. $ in millions) | ||||||||||||
| Generic products (including biosimilars) |
$ | 3,657 | $ | 3,599 | 2 | % | ||||||
| AJOVY |
295 | 207 | 42 | % | ||||||||
| AUSTEDO |
2,217 | 1,642 | 35 | % | ||||||||
| BENDEKA and TREANDA |
147 | 168 | (13 | %) | ||||||||
| COPAXONE |
255 | 242 | 6 | % | ||||||||
| UZEDY |
191 | 117 | 63 | % | ||||||||
| Anda |
1,496 | 1,536 | (3 | %) | ||||||||
| Other* |
929 | 523 | 78 | % | ||||||||
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| Total |
$ | 9,186 | $ | 8,034 | 14 | % | ||||||
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| * | Other revenues in 2025 were mainly comprised of development milestone payments of $500 million received in the fourth quarter of 2025, in connection with the initiation of Phase 3 studies for duvakitug (anti-TL1A) (see note 2 to our consolidated financial statements). Other revenues in 2024 include the sale of certain product rights. |
Generic products (including biosimilars) revenues in our United States segment in 2025 increased by 2% to $3,657 million, compared to 2024, mainly driven by higher revenues from our portfolio of biosimilar products and new product launches.
Among the most significant generic products we sold in the United States in 2025 were lenalidomide capsules (the generic version of Revlimid®), Truxima® (the biosimilar to Rituxan®), epinephrine injectable solution (the generic equivalent of EpiPen® and EpiPen Jr®), and SIMLANDI® (the biosimilar to Humira®).
For more information on our generic products, including biosimilars, see “Item 1—Business—Our Product Portfolio and Business Offering—Generic Medicines.”
In 2025, our total prescriptions were approximately 254 million (based on trailing twelve months), representing 6.5% of total U.S. generic prescriptions according to IQVIA data.
AJOVY revenues in our United States segment in 2025 increased by 42% to $295 million, compared to 2024, mainly due to growth in volume. In 2025, AJOVY’s exit market share in the United States in terms of total number of prescriptions was 33.3%, out of the subcutaneous injectable anti-CGRP class, compared to 29.6% in 2024.
For more information on AJOVY, see “Item 1—Business—Our Product Portfolio and Business Offering—Innovative Medicines—AJOVY.”
AUSTEDO revenues (which include AUSTEDO XR) in our United States segment in 2025 increased by 35% to $2,217 million, compared to 2024, mainly due to growth in volume.
For more information on AUSTEDO, see “Item 1—Business—Our Product Portfolio and Business Offering—Innovative Medicines—AUSTEDO.”
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UZEDY revenues in our United States segment in 2025 increased by 63% to $191 million compared to 2024, mainly due to growth in volume.
For more information on UZEDY, see “Item 1—Business—Our Product Portfolio and Business Offering—Innovative Medicines—UZEDY.”
BENDEKA and TREANDA combined revenues in our United States segment in 2025 decreased by 13% to $147 million, compared to 2024, mainly due to competition from alternative therapies, as well as from generic bendamustine products.
For more information on BENDEKA and TREANDA, see “Item 1—Business—Our Product Portfolio and Business Offering—Innovative Medicines—Oncology.”
COPAXONE revenues in our United States segment in 2025 increased by 6% to $255 million, compared to 2024, mainly due to reduction in sales allowance, partially offset by lower volumes.
For more information on COPAXONE, see “Item 1—Business—Our Product Portfolio and Business Offering—Innovative Medicines—COPAXONE.”
Anda revenues from third parties in our United States segment in 2025 decreased by 3% to $1,496 million, compared to 2024, mainly due to lower volumes. Anda, our distribution business in the United States, distributes generic, biosimilar and innovative medicines and OTC pharmaceutical products from Teva and various third-party manufacturers to independent retail pharmacies, pharmacy retail chains, hospitals and physician offices in the United States. Anda is able to compete in the distribution market by maintaining a broad portfolio of products, competitive pricing and delivery throughout the United States.
To align with our Pivot to Growth strategy, commencing January 1, 2026, Anda will no longer be reported under our United States segment. This shift will allow the United States segment to continue to manage its entire product portfolio in the region, while strengthening focus on its biopharmaceutical business, growth engines and innovation. As a result, from that date, Anda will be reported as part of the Company’s Other Activities. We will align our internal financial and segment reporting in coordination with this shift effective January 1, 2026.
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Product Launches and Pipeline
In 2025, we launched the generic version and biosimilar version of the following branded products in the United States:
| Product Name |
Brand Name |
Launch Date |
Total Annual U.S. Branded Sales at Time of Launch (U.S. $ in millions (IQVIA))* |
|||||||
| Mifepristone Tablets |
Korlym® | January | $ | 2 | ||||||
| SELARSDI (Ustekinumab-aekn) injection** |
N/A | February | No Data | |||||||
| Octreotide Acetate for Injectable Suspension, 10mg/Vial |
Sandostatin® LAR Depot | March | $ | 21 | ||||||
| EPYSQLI (eculizumab-aagh) |
Soliris® | April | $ | 367 | ||||||
| Ticagrelor Tablets |
Brilinta® tablets | May | $ | 1,305 | ||||||
| Hydroxyzine Hydrochloride Tablets, USP*** |
N/A | June | $ | 17 | ||||||
| Fidaxomicin Tablets |
Dificid® tablets | July | $ | 410 | ||||||
| Liraglutide Injection |
Saxenda® injection | August | $ | 164 | ||||||
| Dasatinib Tablets |
Sprycel® Tablets | September | $ | 1,366 | ||||||
| Azelastine Hydrochloride and Fluticasone Propionate Nasal Spray |
Dymista® Nasal Spray | September | $ | 69 | ||||||
| Cyclosporine Ophthalmic Emulsion |
Restasis® | October | $ | 1,866 | ||||||
| Dalbavancin for Injection |
Dalvance® for injection | October | $ | 260 | ||||||
| Amphetamine Extended-Release Orally Disintegrating Tablets CII |
Adzenys XR-ODT® CII | December | $ | 172 | ||||||
| * | The figures presented are for the twelve months ended in the calendar quarter immediately prior to our launch or re-launch. |
| ** | SELARSDI (Ustekinumab-aekn) injection, as an interchangeable biosimilar to Stelara®. |
| *** | Product was relaunched. |
As of December 31, 2025, our generic products pipeline in the United States includes 116 product applications awaiting FDA approval, including 66 tentative approvals. This total reflects all pending ANDAs, supplements for product line extensions and tentatively approved applications and includes some instances where more than one application was submitted for the same reference product. Excluding overlaps, the branded products underlying these pending applications had U.S. sales for the twelve months ended September 30, 2025 of approximately $124 billion, according to IQVIA. Approximately 80% of pending applications include a paragraph IV patent challenge and we believe we are first-to-file with respect to 54 of these products, or 77 products including final approvals where launch is pending a settlement agreement or court decision. Collectively, these first-to-file opportunities represent over $85 billion in U.S. brand sales for the twelve months ended September 30, 2025, according to IQVIA.
IQVIA reported brand sales are one of the many indicators of future potential value of a launch, but equally important are the mix and timing of competition, as well as cost effectiveness. The potential advantages of being the first filer with respect to some of these products may be subject to forfeiture, shared exclusivity or competition from so-called “authorized generics,” which may ultimately affect the value derived.
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In 2025, we received tentative approvals for generic equivalents of the products listed in the table below, excluding overlapping applications. A “tentative approval” indicates that the FDA has substantially completed its review of an application and final approval is expected once the relevant patent expires, a court decision is reached, a 30-month regulatory stay lapses or a 180-day exclusivity period awarded to another manufacturer either expires or is forfeited.
| Generic Name |
Brand Name | Total U.S. Annual Branded Market (U.S. $ in millions (IQVIA))* |
||||
| Rimegepant Orally Disintegrating Tablets, 75mg |
Nurtec ODT® | $ | 4,100 | |||
| Prucalopride Tablets, 1 mg and 2 mg |
Motegrity® | $ | 173 | |||
| Elagolix Tablets, 150 mg and 200 mg |
Orilissa® | $ | 150 | |||
| Azacitidine Tablets, 200 mg and 300 mg |
Onureg® | $ | 141 | |||
| Octreotide Delayed-release Capsules, 20 mg |
Mycapssa® | No Data | ** | |||
| Nintedanib Capsules, 100 mg and 150 mg |
Ofev® | $ | 3,280 | |||
| Macitentan Tablets |
Opsumit® | $ | 1,181 | |||
| Elagolix, Estradiol and Norethindrone Acetate Capsules, 300 mg / 1 mg / 0.5 mg; Elagolix Capsules, 300 mg |
Oriahnn® | $ | 11 | |||
| * | The figures presented are for the twelve months ended in the calendar quarter immediately prior to our launch or re-launch. |
| ** | Mycapssa® ships directly to patients, no IQVIA data is available. |
For a description of our innovative medicines pipeline, see “Item 1—Business—Our Product Portfolio and Business Offering—Innovative Medicines” above.
United States Gross Profit
Gross profit from our United States segment in 2025 was $5,618 million, an increase of 28% compared to $4,388 million in 2024.
Gross profit margin for our United States segment in 2025 increased to 61.2%, compared to 54.6% in 2024. This increase was mainly due to the development milestone payments received in connection with the initiation of Phase 3 studies for duvakitug (anti-TL1A), and a favorable mix of products primarily driven by higher revenues from AUSTEDO.
United States R&D Expenses
R&D expenses relating to our United States segment in 2025 were $633 million, flat compared to 2024.
For a description of our R&D expenses in 2025, see “—Teva Consolidated Results—Research and Development (R&D) Expenses, net” below.
United States S&M Expenses
S&M expenses relating to our United States segment in 2025 were $1,172 million, an increase of 12% compared to $1,049 million in 2024. This increase was mainly due to promotional activities related to our key innovative products mainly AUSTEDO and UZEDY.
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United States G&A Expenses
G&A expenses relating to our United States segment in 2025 were $458 million, an increase of 12% compared to $410 million in 2024.
For a description of our G&A expenses in 2025, see “—Teva Consolidated Results— General and Administrative (G&A) Expenses” below.
United States Profit
Profit from our United States segment consists of revenues less cost of sales, R&D expenses, S&M expenses, G&A expenses and any other expenses (income) related to this segment. Segment profit does not include amortization and certain other items.
Profit from our United States segment in 2025 was $3,356 million, an increase of 46% compared to $2,296 million in 2024. This increase was mainly due to higher gross profit, partially offset by higher S&M and G&A expenses, as discussed above.
Europe Segment
The following table presents revenues, expenses and profit for our Europe segment for the past two years:
| Year ended December 31, | ||||||||||||||||
| 2025 | 2024 | |||||||||||||||
| (U.S. $ in millions / % of Segment Revenues) | ||||||||||||||||
| Revenues |
$ | 5,040 | 100% | $ | 5,103 | 100% | ||||||||||
| Cost of sales |
2,293 | 45.5% | 2,197 | 43.1% | ||||||||||||
| Gross profit |
2,747 | 54.5% | 2,905 | 56.9% | ||||||||||||
| R&D expenses |
247 | 4.9% | 229 | 4.5% | ||||||||||||
| S&M expenses |
902 | 17.9% | 826 | 16.2% | ||||||||||||
| G&A expenses |
295 | 5.9% | 272 | 5.3% | ||||||||||||
| Other loss (income) |
1 | § | 3 | § | ||||||||||||
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| Segment profit* |
$ | 1,303 | 25.9% | $ | 1,575 | 30.9% | ||||||||||
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| * | Segment profit does not include amortization and certain other items. |
| § | Represents an amount less than 0.5%. |
Europe Revenues
Our Europe segment includes the European Union, the United Kingdom and certain other European countries.
Revenues from our Europe segment in 2025 were $5,040 million, a decrease of $63 million, or 1%, compared to 2024. In local currency terms, revenues decreased by 5%, mainly due to the year-over-year impact from the sale of certain product rights, lower revenues from generic and OTC products, as well as COPAXONE, partially offset by higher revenues from AJOVY.
In 2025, revenues were positively impacted by exchange rate fluctuations of $173 million, net of hedging effects, compared to 2024. Revenues in 2025 were affected by a $31 million negative hedging impact, compared to a positive hedging impact of $21 million in 2024, which are included in “Other” in the table below. See note 10d to our consolidated financial statements.
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Revenues by Major Products and Activities
The following table presents revenues for our Europe segment by major products and activities for the past two years:
| Year ended December 31, | Percentage Change 2025-2024 |
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| 2025 | 2024 | |||||||||||
| (U.S. $ in millions) | ||||||||||||
| Generic products (including OTC and biosimilars) |
$ | 4,044 | $ | 3,926 | 3 | % | ||||||
| AJOVY |
270 | 216 | 25 | % | ||||||||
| COPAXONE |
181 | 213 | (15 | %) | ||||||||
| Respiratory products |
227 | 244 | (7 | %) | ||||||||
| Other* |
319 | 504 | (37 | %) | ||||||||
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| Total |
$ | 5,040 | $ | 5,103 | (1 | %) | ||||||
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| * | Other revenues in 2025 and 2024 include the sale of certain product rights. |
Generic products revenues (including OTC and biosimilar products) in our Europe segment in 2025 increased by 3% to $4,044 million compared to 2024. In local currency terms, revenues decreased by 2%, mainly due to lower volumes and price reductions as a result of market dynamics, and lower sales of seasonal OTC products, partially offset by higher revenues from recently launched products.
AJOVY revenues in our Europe segment in 2025 were $270 million, an increase of 25%, in U.S. dollars. In local currency terms, revenues increased by 19%, compared to 2024. This increase was due to growth in volume.
For more information on AJOVY, see “Item 1—Business—Our Product Portfolio and Business Offering—Innovative Medicines—AJOVY.”
COPAXONE revenues in our Europe segment in 2025 were $181 million, a decrease of 15% in U.S. dollars. In local currency terms, revenues decreased by 19%, compared to 2024. This decrease was mainly due to price reductions and lower volumes resulting from the availability of alternative therapies.
For more information on COPAXONE, see “Item 1—Business—Our Product Portfolio and Business Offering—Innovative Medicines—COPAXONE.”
Respiratory products revenues in our Europe segment in 2025 decreased by 7% to $227 million, compared to 2024. In local currency terms, revenues decreased by 11%, mainly due to net price reductions and lower volumes.
Product Launches and Pipeline
As of December 31, 2025, our generic products pipeline in Europe included 622 generic approvals relating to 61 compounds in 125 formulations, with no EMA approvals received. In addition, approximately 1,537 marketing authorization applications are pending approval in 37 European countries, which approvals relate to 95 compounds in 229 formulations. No applications are pending with the EMA.
For a description of our innovative medicines pipeline, see “Item 1—Business—Research and Development” above.
Europe Gross Profit
Gross profit from our Europe segment in 2025 was $2,747 million, a decrease of 5% compared to $2,905 million in 2024.
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Gross profit margin for our Europe segment in 2025 decreased to 54.5%, compared to 56.9% in 2024, mainly due to a change in the mix of products, lower proceeds from the sale of certain product rights, and a negative impact from hedging activities.
Europe R&D Expenses
R&D expenses relating to our Europe segment in 2025 were $247 million, an increase of 8% compared to $229 million in 2024.
For a description of our R&D expenses in 2025, see “—Teva Consolidated Results—Research and Development (R&D) Expenses, net” below.
Europe S&M Expenses
S&M expenses relating to our Europe segment in 2025 were $902 million, an increase of 9% compared to $826 million in 2024. This increase was mainly to support revenue growth of our generic and key innovative products, including new launches, and due to a negative impact from exchange rate fluctuations.
Europe G&A Expenses
G&A expenses relating to our Europe segment in 2025 were $295 million, an increase of 8% compared to $272 million in 2024.
For a description of our G&A expenses in 2025, see “—Teva Consolidated Results— General and Administrative (G&A) Expenses” below.
Europe Profit
Profit of our Europe segment consists of revenues less cost of sales, R&D expenses, S&M expenses, G&A expenses and any other expenses (income) related to this segment. Segment profit does not include amortization and certain other items.
Profit from our Europe segment in 2025 was $1,303 million, a decrease of 17% compared to $1,575 million in 2024, mainly due to lower gross profit, as well as higher operational expenses, as discussed above.
International Markets Segment
The following table presents revenues, expenses and profit for our International Markets segment for the past two years:
| Year ended December 31, | ||||||||||||||||
| 2025 | 2024 | |||||||||||||||
| (U.S. $ in millions / % of Segment Revenues) | ||||||||||||||||
| Revenues |
$ | 2,162 | 100% | $ | 2,463 | 100% | ||||||||||
| Cost of sales |
1,116 | 51.6% | 1,229 | 49.9% | ||||||||||||
| Gross profit |
1,046 | 48.4% | 1,235 | 50.1% | ||||||||||||
| R&D expenses |
103 | 4.7% | 112 | 4.5% | ||||||||||||
| S&M expenses |
475 | 21.9% | 534 | 21.7% | ||||||||||||
| G&A expenses |
147 | 6.8% | 150 | 6.1% | ||||||||||||
| Other loss (income) |
(14 | ) | (0.6%) | (2 | ) | § | ||||||||||
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| Segment profit* |
$ | 336 | 15.5% | $ | 440 | 17.9% | ||||||||||
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| * | Segment profit does not include amortization and certain other items. |
| § | Represents an amount less than 0.5%. |
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International Markets Revenues
Our International Markets segment includes all countries in which we operate other than the United States and the countries included in our Europe segment, and commencing January 1, 2024, also includes Canada. The International Markets segment covers a substantial portion of the global pharmaceutical industry, including more than 35 countries. See note 19 to our consolidated financial statements.
The countries in our International Markets segment include highly regulated, mainly generic markets, such as Canada and Israel, and branded generics-oriented markets, such as Russia and certain Latin America markets.
On March 31, 2025, we divested our Teva-Takeda business venture in Japan, which included generic products and legacy products. Since the establishment of the business venture and until the completion of its sale, Teva held 51% of the outstanding common stock of the business venture. On March 31, 2025, we deconsolidated the business venture from our financial statements. For additional information, see notes 2 and 22 to our consolidated financial statements.
As of the date of this Annual Report on Form 10-K, sustained conflict between Russia and Ukraine and disruption in the region is ongoing. Russia and Ukraine markets are included in our International Markets segment results and we have no manufacturing or R&D facilities in these markets. In 2025, the impact of this conflict on our International Markets segment’s results of operations and financial condition was immaterial. Consistent with our foreign exchange risk management hedging programs, in 2025, we partially hedged our exposure to currency exchange rate fluctuations with respect to our balance sheet assets, revenues and expenses. As of the end of 2025, we also hedge a small part of our projected net revenues in Russian ruble for 2026. Prior to and since the escalation of the conflict, we have been taking measures to reduce our operational cash balances in Russia and Ukraine. We have been monitoring the solvency of our customers in Russia and Ukraine and have taken measures, where practicable, to mitigate our exposure to risks related to the conflict in the region. However, the duration, severity and global implications (including potential inflation and devaluation consequences) of the conflict cannot be predicted, and could have an effect on our business, including on our exchange rate exposure, supply chain, operational costs and commercial presence in these markets.
Revenues from our International Markets segment in 2025 were $2,162 million, a decrease of $301 million, or 12%, compared to 2024. In local currency terms, revenues decreased by 11% compared to 2024. This decrease was mainly due to the divestment of our business venture in Japan, lower proceeds from the sale of certain product rights, as well as a negative hedging impact, partially offset by higher revenues from generic products in other markets and AJOVY.
In 2025, revenues were negatively impacted by exchange rate fluctuations of $36 million net of hedging effects, compared to 2024. Revenues in 2025, were affected by a $34 million negative hedging impact, compared to a $13 million positive hedging impact in 2024, which are included in “Other” in the table below. See note 10d to our consolidated financial statements.
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Revenues by Major Products and Activities
The following table presents revenues for our International Markets segment by major products and activities for the past two years:
| Year ended December 31, | Percentage Change |
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| 2025 | 2024 | 2025-2024 | ||||||||||
| (U.S. $ in millions) | ||||||||||||
| Generic products (including OTC and biosimilars) |
$ | 1,721 | $ | 1,937 | (11 | %) | ||||||
| AJOVY |
108 | 84 | 28 | % | ||||||||
| AUSTEDO |
43 | 46 | (6 | %) | ||||||||
| COPAXONE |
32 | 48 | (34 | %) | ||||||||
| Other* |
259 | 349 | (26 | %) | ||||||||
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| Total |
$ | 2,162 | $ | 2,463 | (12 | %) | ||||||
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| * | Other revenues in 2025 and 2024 include the sale of certain product rights. |
Generic products revenues (including OTC and biosimilar products) in our International Markets segment in 2025 were $1,721, a decrease of 11% in both U.S. dollars and local currency terms compared to 2024. This decrease was mainly due to the divestment of our business venture in Japan, partially offset by higher revenues in other markets.
AJOVY revenues in our International Markets segment in 2025 increased by 28% to $108 million, compared to 2024. In local currency terms, revenues increased by 27%, due to growth in existing markets in which AJOVY was launched.
For more information on AJOVY, see “Item 1—Business—Our Product Portfolio and Business Offering— Innovative Medicines—AJOVY.”
AUSTEDO revenues in our International Markets segment were $43 million in 2025, a decrease of 6%, in both U.S. dollars and local currency terms compared to 2024. This decrease was mainly due to timing of shipments.
For more information on AUSTEDO, see “Item 1—Business—Our Product Portfolio and Business Offering—Innovative Medicines—AUSTEDO.”
COPAXONE revenues in our International Markets segment in 2025 decreased by 34% to $32 million, compared to 2024. In local currency terms, revenues decreased by 30%, mainly due to market share erosion and competition.
For more information on COPAXONE, see “Item 1—Business—Our Product Portfolio and Business Offering—Innovative Medicines—COPAXONE.”
International Markets Gross Profit
Gross profit from our International Markets segment in 2025 was $1,046 million, a decrease of 15% compared to $1,235 million in 2024.
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Gross profit margin for our International Markets segment in 2025 decreased to 48.4%, compared to 50.1% in 2024. This decrease was mainly due to lower proceeds from the sale of certain product rights and a negative hedging impact, partially offset by price increases due to inflationary pressure in certain markets and a favorable mix of products.
International Markets R&D Expenses
R&D expenses relating to our International Markets segment in 2025 were $103 million, a decrease of 8% compared to $112 million in 2024.
For a description of our R&D expenses in 2025, see “—Teva Consolidated Results—Research and Development (R&D) Expenses, net” below.
International Markets S&M Expenses
S&M expenses relating to our International Markets segment in 2025 were $475 million, a decrease of 11% compared to $534 million in 2024, mainly as a result of the divestment of our business venture in Japan, as well as cost efficiencies.
International Markets G&A Expenses
G&A expenses relating to our International Markets segment in 2025 were $147 million, a decrease of 2% compared to $150 million in 2024.
For a description of our G&A expenses in 2025, see “—Teva Consolidated Results— General and Administrative (G&A) Expenses below”.
International Markets Profit
Profit of our International Markets segment consists of revenues less cost of sales, R&D expenses, S&M expenses, G&A expenses and other expenses (income) related to this segment. Segment profit does not include amortization and certain other items.
Profit from our International Markets segment in 2025 was $336 million a decrease of 24% compared to $440 million in 2024. This decrease was mainly due to the divestment of our business venture in Japan, lower proceeds from the sale of certain product rights and a negative hedging impact.
Other Activities
We have other sources of revenues, primarily the sale of APIs to third parties, certain contract manufacturing services and an out-licensing platform offering a portfolio of products to other pharmaceutical companies, through our affiliate Medis. These other activities are not included in the United States, Europe or International Markets segments described above. For information on a change to our reporting segments commencing January 1, 2026, see above “—United States Segment”.
On January 31, 2024, we announced that we intend to divest our API business (including its R&D, manufacturing and commercial activities) through a sale. The intention to divest is in alignment with our Pivot to Growth strategy. On November 5, 2025, we announced that exclusive discussions with a selected buyer on the sale have terminated. Teva has initiated a renewed sales process, maintaining its strategic intention to divest its API business. However, there can be no assurance regarding the ultimate timing or structure of a potential divestiture or that a divestiture will be agreed or completed at all. For further information, see note 2 to our consolidated financial statements.
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Our revenues from other activities in 2025 were $870 million, a decrease of 8% compared to 2024. In local currency terms revenues decreased by 10% compared to 2024, mainly due to a decrease in revenues from contract manufacturing services.
API sales to third parties in 2025 were $526 million a decrease of 5% in both U.S. dollars and local currency terms compared to 2024, mainly due to lower demand.
Teva Consolidated Results
Revenues
Revenues in 2025 were $17,258 million, an increase of 4% in U.S. dollars, or 3%, in local currency terms, compared to 2024. This increase was mainly due to higher revenues from our key innovative products AUSTEDO, AJOVY and UZEDY, and from development milestone payments received in connection with the initiation of Phase 3 studies for duvakitug (anti-TL1A), partially offset by lower revenues from our International Markets segment due to the divestment of our business venture in Japan, from certain other innovative products across all our segments, lower proceeds from the sale of certain product rights and from generic products in our Europe segment. See “—United States Revenues,” “—Europe Revenues,” “—International Markets Revenues” and “—Other Activities” above.
Exchange rate movements during 2025, net of hedging effects, positively impacted our revenues by $152 million, compared to 2024. See note 10d to our consolidated financial statements.
Gross Profit
Gross profit in 2025 was $8,938 million, an increase of 11% compared to 2024.
Gross profit margin was 51.8% in 2025, compared to 48.7% in 2024. This increase in gross profit margin was mainly due to a favorable mix of products, primarily driven by higher revenues from AUSTEDO, and development milestone payments received in connection with the initiation of Phase 3 studies for duvakitug (anti-TL1A), partially offset by lower proceeds from the sale of certain product rights.
Research and Development (R&D) Expenses, net
Our R&D activities for innovative medicines and biosimilar products in each of our segments include costs of discovery research, preclinical work, drug formulation, early- and late-stage clinical development and product registration costs. These expenditures are reported net of contributions received from collaboration partners. Our spending takes place throughout the development process, including (i) early-stage projects in both discovery and preclinical phases; (ii) middle-stage projects in clinical programs up to Phase 3; (iii) late-stage projects in Phase 3 programs, including where a new drug application is currently pending approval; (iv) post-approval studies for marketed products; and (v) indirect expenses, such as costs of infrastructure and personnel.
Our R&D activities for generic products in each of our segments include both (i) direct expenses relating to product formulation, analytical method development, stability testing, management of bioequivalence and other clinical studies and regulatory filings; and (ii) indirect expenses, such as costs of infrastructure and personnel.
Our R&D expenses, net in 2025 were $1,013 million, an increase of 2% compared to $998 million in 2024, as we continue to execute on our Pivot to Growth strategy.
Our higher R&D expenses, net in 2025, compared to 2024, were mainly due to an increase in immunology and in immuno-oncology, as well as in neuroscience (mainly neurodegeneration), partially offset by the non-recurrence of milestone payments related to certain biosimilar projects, and lower expenses related to generics projects.
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Our R&D expenses, net in 2025 were also impacted by reimbursements and development cost sharing from our strategic collaborations. See note 2 to our consolidated financial statements.
R&D expenses as a percentage of revenues were 5.9% in 2025, compared to 6.0% in 2024.
Selling and Marketing (S&M) Expenses
S&M expenses in 2025 were $2,686 million, an increase of 6% compared to 2024. Our S&M expenses were primarily the result of the factors discussed above under “—United States Segment— S&M Expenses,” “—Europe Segment— S&M Expenses” and “—International Markets Segment— S&M Expenses.”
S&M expenses as a percentage of revenues were 15.6% in 2025, compared to 15.4% in 2024.
General and Administrative (G&A) Expenses
G&A expenses in 2025 were $1,287 million, an increase of 11% compared to 2024. This increase was mainly due to costs related to optimization activities of Teva’s global organization and operations in connection with Teva’s Transformation programs, as well as a negative impact from exchange rate fluctuations.
G&A expenses as a percentage of revenues were 7.5% in 2025, compared to 7.0% in 2024.
Identifiable Intangible Asset Impairments
We recorded expenses of $259 million for identifiable intangible asset impairments in 2025, compared to expenses of $251 million in 2024. See note 6 to our consolidated financial statements.
Goodwill Impairment
No goodwill impairment charge was recorded in 2025. We recorded a goodwill impairment charge of $1,280 million in the year ended December 31, 2024 related to our Teva API reporting unit. See note 7 to our consolidated financial statements.
Other Asset Impairments, Restructuring and Other Items
We recorded expenses of $1,050 million for other asset impairments, restructuring and other items in 2025, compared to expenses of $1,388 million in 2024. Expenses in 2025 were mainly comprised of an impairment related to a manufacturing facility in Europe. Expenses in 2024 were mainly comprised of impairments related to the classification of our business venture in Japan and our API business (including its R&D, manufacturing and commercial activities) as held for sale. See note 15 to our consolidated financial statements.
Legal Settlements and Loss Contingencies
In 2025, we recorded expenses of $467 million in legal settlements and loss contingencies, compared to expenses of $761 million in 2024. See note 11 to our consolidated financial statements.
Other Income (Loss)
Other loss in 2025 was $18 million, compared to other income of $14 million in 2024. See note 16 to our consolidated financial statements.
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Operating Income (Loss)
Operating income was $2,157 million in 2025, compared to an operating loss of $303 million in 2024. This change was mainly due to goodwill impairment charges incurred in 2024, lower other asset impairments, restructuring and other items in 2025, as well as higher gross profit and lower legal settlements and loss contingencies in 2025.
Operating income as a percentage of revenues was 12.5% in 2025, compared to operating loss as a percentage of revenues of 1.8% in 2024.
Financial Expenses, Net
Financial expenses, net were $934 million in 2025, compared to $981 million in 2024. Financial expenses in 2025 were mainly comprised of net-interest expenses of $824 million. Financial expenses in 2024 were mainly comprised of net-interest expenses of $915 million.
Reconciliation Table to Consolidated Income (Loss) Before Income Taxes
The following table presents a reconciliation of our segment profits to Teva’s consolidated operating income (loss) and to consolidated income (loss) before income taxes for the past three years:
| Year ended December 31, |
||||||||||||
| 2025 | 2024 | 2023 | ||||||||||
| (U.S. $ in millions) | ||||||||||||
| United States profit |
$ | 3,356 | $ | 2,296 | $ | 2,394 | ||||||
| Europe profit |
1,303 | 1,575 | 1,478 | |||||||||
| International Markets profit |
336 | 440 | 465 | |||||||||
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|
|
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| Total reportable segments profit |
4,995 | 4,311 | 4,338 | |||||||||
| Profit (loss) of other activities |
(90 | ) | 18 | 24 | ||||||||
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|
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| Amounts not allocated to segments: |
||||||||||||
| Amortization |
581 | 588 | 616 | |||||||||
| Other assets impairments, restructuring and other items |
1,050 | 1,388 | 718 | |||||||||
| Goodwill impairment |
— | 1,280 | 700 | |||||||||
| Intangible asset impairments |
259 | 251 | 350 | |||||||||
| Legal settlements and loss contingencies |
473 | 761 | 1,043 | |||||||||
| Other unallocated amounts |
384 | 364 | 502 | |||||||||
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|
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| Consolidated operating income (loss) |
2,157 | (303 | ) | 433 | ||||||||
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| Financial expenses, net |
934 | 981 | 1,057 | |||||||||
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| Consolidated income (loss) before income taxes |
$ | 1,223 | $ | (1,284 | ) | $ | (624 | ) | ||||
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Income Taxes
In 2025, we recognized a tax benefit of $180 million on a pre-tax income of $1,223 million. In 2024, we recognized a tax expense of $676 million on a pre-tax loss of $1,284 million. See note 13 to our consolidated financial statements.
Share In (Profits) Losses of Associated Companies, Net
Share in profits of associated companies, net was $15 million in 2025, compared to $1 million in 2024.
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Net Income (Loss) Attributable to redeemable and non-redeemable non-controlling interests
Net income attributable to redeemable and non-redeemable non-controlling interests was $7 million in 2025, compared to a net loss attributable to redeemable and non-redeemable non-controlling interests of $320 million in 2024. The net loss in 2024 was mainly due to higher impairments of tangible assets, largely related to the classification of our business venture in Japan as held for sale. See note 15 to our consolidated financial statements.
Net Income (Loss) Attributable to Teva
Net income was $1,410 million in 2025, compared to a net loss of $1,639 million in 2024. This change was mainly due to the changes in operating income and income taxes, partially offset by net loss attributable to non-controlling interests in 2024, as discussed above.
Diluted Shares Outstanding and Earnings (Loss) Per Share
The weighted average diluted shares outstanding used for the fully diluted share calculation for the years 2025 and 2024 was 1,163 million and 1,131 million shares, respectively.
Diluted earnings per share was $1.21 for the year ended December 31, 2025, compared to diluted loss per share of $1.45 for the year ended December 31, 2024. See note 18 to our consolidated financial statements.
Share Count for Market Capitalization
We calculate share amounts using the outstanding number of shares (i.e., excluding treasury shares) plus shares that would be outstanding upon the exercise of options and vesting of RSUs and PSUs and the conversion of our convertible senior debentures, in each case, at period end.
As of December 31, 2025 and 2024, the fully diluted share count for purposes of calculating our market capitalization was approximately 1,184 million and 1,174 million, respectively.
Impact of Currency Fluctuations on Results of Operations
In 2025, approximately 43% of our revenues were denominated in currencies other than the U.S. dollar. Since our results are reported in U.S. dollars, we are subject to significant foreign currency risks. Accordingly, changes in the rate of exchange between the U.S. dollar and local currencies in the markets in which we operate (primarily the euro, British pound, Swiss franc, Russian ruble, Canadian dollar, new Israeli shekel, Polish złoty, Swedish krona and Chilean peso) impact our results.
During 2025, the following main currencies relevant to our operations decreased in value against the U.S. dollar (each on an annual average compared to annual average basis): the Argentinian peso by 26%, the Turkish lira by 17%, the Mexican peso by 5%, the Brazilian real by 4%, Indian rupee by 4% and the Ukraine hryvna by 4%. The following main currencies relevant to our operations increased in value against the U.S. dollar: the Russian ruble by 11%, the Swedish krona by 8%, the new Israeli shekel by 7%, the Swiss franc by 6%, the Polish złoty by 6%, the euro by 4%, the Bulgarian lev by 4% and the British pound by 3%.
As a result, exchange rate movements during 2025, net of hedging effects, positively impacted overall revenues by $152 million and negatively impacted operating income by $48 million compared to 2024.
In 2025, a negative hedging impact of $65 million was recognized under revenues and a positive hedging impact of $8 million was recognized under cost of sales. In 2024, a positive hedging impact of $34 million was recognized under revenues and a negative hedging impact of $5 million was recognized under cost of sales.
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The impact of hedging transactions against future projected revenues and expenses are recognized on the balance sheet at their fair value on a quarterly basis, while the foreign exchange impact on the underlying revenues and expenses may occur in subsequent quarters. See note 10d to our consolidated financial statements.
Commencing the third quarter of 2018, the cumulative inflation in Argentina exceeded 100% or more over a 3-year period. Although this triggered highly inflationary accounting treatment, it did not have a material impact on our results of operations.
Commencing the second quarter of 2022, the cumulative inflation in Turkey exceeded 100% or more over a three-year period. Although this triggered highly inflationary accounting treatment, it did not have a material impact on our results of operations.
Liquidity and Capital Resources
Total balance sheet assets were $40,748 million as of December 31, 2025, compared to $39,326 million as of December 31, 2024.
Our working capital balance, which includes accounts receivables net of SR&A, inventories, prepaid expenses and other current assets, accounts payables, employee-related obligations, accrued expenses and other current liabilities, was negative $2,733 million as of December 31, 2025, compared to negative $2,837 million as of December 31, 2024. This increase was mainly due to higher inventory levels primarily due to exchange rate fluctuations and an increase in accounts receivables, net of SR&A, related to reduced utilization of our U.S. securitization program, partially offset by an increase in accounts payables. We continue our efforts to optimize our working capital management.
Cash investment in property, plant and equipment and intangible assets in 2025 was $501 million, compared to $498 million in 2024. Depreciation was $421 million in 2025, compared to $471 million in 2024.
Cash and cash equivalents as of December 31, 2025 were $3,556 million compared to $3,300 million as of December 31, 2024.
In the first quarter of 2025, we paid a dividend of $340 million to redeemable non-controlling interests in our business venture in Japan.
Our cash on hand that is not used for ongoing operations is generally invested in bank deposits, as well as liquid securities that bear fixed and floating rates.
Teva’s principal sources of short-term liquidity are its cash on hand, existing cash investments, liquid securities and available credit facilities, primarily its $1.8 billion unsecured syndicated sustainability-linked revolving credit facility entered into in April 2022, as amended most recently in December 2025 (“RCF”). See note 9 to our consolidated financial statements.
2025 Debt Balance and Movements
As of December 31, 2025, our debt was $16,807 million, compared to $17,783 million as of December 31, 2024. This decrease was mainly due to repayment at maturity of $1,812 million of our senior notes (as detailed below), partially offset by an increase of $803 million due to exchange rate fluctuations. Additionally, during the second quarter of 2025, we repurchased $2,290 million aggregate principal amount of notes upon consummation of a cash tender offer, and issued $2,298 million of senior notes, net of discount and issuance costs. For further information, see note 9 to our consolidated financial statements.
In January 2025, we repaid $426 million of the 6% senior notes at maturity and $427 million of the 7.13% senior notes at maturity.
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In March 2025, we repaid $515 million of the 4.50% senior notes at maturity.
In July 2025, we repaid $444 million of the 1% senior notes at maturity.
In February 2026, we repaid $23 million of the 0.25% convertible senior debentures at maturity.
Our debt as of December 31, 2025 was 57% denominated in U.S. dollar, with the remainder denominated in euro.
The portion of total debt classified as short-term as of December 31, 2025 was 11%, compared to 10% as of December 31, 2024.
Our financial leverage, which is the ratio between our debt and the sum of our debt and equity, was 68% as of December 31, 2025, compared to 77% as of December 31, 2024.
Our average debt maturity was approximately 5.6 years as of December 31, 2025, compared to 5.5 years as of December 31, 2024.
2024 Debt Balance and Movements
In April 2024, we repaid $956 million of the 6% senior notes at maturity.
In October 2024, we repaid $685 million of the 1.13% senior notes at maturity.
Total Equity
Total equity was $7,914 million as of December 31, 2025, compared to $5,380 million as of December 31, 2024. This increase was mainly due to a net income attributable to Teva of $1,410 million, and a positive impact of $719 million from exchange rate fluctuations.
Exchange rate fluctuations affected our balance sheet, as approximately 62% of our net assets (including both non-monetary and monetary assets) were in currencies other than the U.S. dollar. When compared to December 31, 2024, changes in currency rates had a positive impact of $719 million on our equity as of December 31, 2025. The following main currencies increased in value against the U.S. dollar: Russian ruble by 28%, Mexican peso by 13%, Polish złoty by 13%, Swiss franc by 12%, Bulgarian lev by 12%, euro by 11%, Chilean peso by 9%, British pound by 7%, and Canadian dollar by 5%. All comparisons are on a year-end to year-end basis.
Cash Flow
We continually seek to improve the efficiency of our working capital management. Periodically, as part of our cash and commercial relationship management activities, we make decisions in our commercial, supply chain, and other activities which drive an optimization of our inventory levels, an acceleration of receivable payments from customers, or deceleration of payments to vendors, including timing of payments related to legal settlements, tax authorities and other matters. These have the effect of increasing or decreasing cash from operations, as well as working capital balance items during any given period. Increased cash from operations has the effect of reducing our leverage ratio, which is measured net of cash and cash equivalents, as of the end of such period. In connection with these efforts, we were able to secure more favorable payment terms from many of our vendors which are expected to continue in future periods. In addition, in periods in which collections from customers are delayed, we have and expect we may in the future extend the time to pay certain vendors, so as to balance our liquidity position. Such decisions have had, and may in the future have, a material impact on our annual operating cash flow measurement and results of operations.
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Cash flow generated from operating activities in 2025 was $1,649 million, compared to $1,247 million in 2024. The increase in 2025 resulted mainly from development milestone payments received in connection with the initiation of Phase 3 studies for duvakitug (anti-TL1A), partially offset by higher legal settlement payments. Net changes in working capital items were neutral.
During 2025, we generated free cash flow of $2,396 million, which we define as comprising $1,649 million in cash flow generated from operating activities, $1,214 million in beneficial interest collected in exchange for securitized accounts receivables (under our EU securitization program) and $34 million in proceeds from divestitures of businesses and other assets, partially offset by $501 million in cash used for capital investments. During 2024, we generated free cash flow of $2,068 million, which we define as comprising $1,247 million in cash flow generated from operating activities, $1,291 million in beneficial interest collected in exchange for securitized accounts receivables (under our EU securitization program) and $43 million proceeds from divestitures of businesses and other assets, partially offset by $498 million in cash used for capital investments and $15 million in cash used for acquisition of businesses, net of cash acquired. The increase in 2025 resulted mainly from higher cash flow generated from operating activities.
Dividends
We have not paid dividends on our ordinary shares or ADSs since December 2017.
Commitments
In addition to financing obligations under short-term debt and long-term senior notes and loans, debentures and convertible debentures, our major contractual obligations and commercial commitments include leases, royalty payments, contingent payments pursuant to acquisition agreements, collaboration agreements and participation in joint ventures associated with R&D activities. For further information on our agreements with mAbxience, Launch Therapeutics and Abingworth, Biolojic Design, Royalty Pharma, Sanofi, Modag, Alvotech, Takeda and MedinCell, see note 2 to our consolidated financial statements.
We are committed to pay royalties to owners of know-how, partners in alliances and certain other arrangements, and to parties that financed R&D at a wide range of rates as a percentage of sales of certain products, as defined in the agreements. In some cases, the royalty period is not defined; in other cases, royalties will be paid over various periods not exceeding 20 years. Certain of our collaboration agreements include cost-sharing arrangements for development activities which represent additional contractual commitments with the amount and timing of such payments dependent on the progress of such activities.
In connection with certain development, supply and marketing, and research and collaboration or services agreements, we are required to indemnify, in unspecified amounts, the parties to such agreements against third-party claims relating to (i) infringement or violation of intellectual property or other rights of such third party; or (ii) damages to users of the related products. Except as described in our financial statements, we are not aware of any material pending action that may result in the counterparties to these agreements claiming such indemnification.
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Aggregated Contractual Obligations
The following table summarizes our material contractual obligations and commitments as of December 31, 2025:
| Payments Due by Period | ||||||||||||||||||||
| Total | Less than 1 year |
1-3 years |
3-5 years |
More than 5 years |
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| (U.S. $ in millions) | ||||||||||||||||||||
| Long-term debt obligations, including estimated interest* |
$ | 21,704 | $ | 2,625 | $ | 6,212 | $ | 5,541 | $ | 7,326 | ||||||||||
| Purchase obligations (including purchase orders) |
1,623 | 1,249 | 249 | 123 | 2 | |||||||||||||||
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| Total |
$ | 23,327 | $ | 3,874 | $ | 6,461 | $ | 5,664 | $ | 7,328 | ||||||||||
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| * | Long-term debt obligations mainly include senior notes, sustainability-linked senior notes and convertible senior debentures, as disclosed in note 9 to our consolidated financial statements. |
The total gross amount of unrecognized tax benefits for uncertain tax positions was $596 million on December 31, 2025. Payment of these obligations would result from settlements with tax authorities. Due to the difficulty in determining the timing and magnitude of settlements, these obligations are not included in the table above. Correspondingly, it is difficult to ascertain whether we will pay any significant amount related to these obligations within the next year.
We have committed to make potential future milestone payments to third parties under various agreements. These payments are contingent upon the occurrence of certain future events and, given the nature of these events, it is unclear when, if ever, we may be required to pay such amounts. As of December 31, 2025, if all development milestones and targets, for compounds in Phase 2 and more advanced stages of development, are achieved, the total contingent payments could reach an aggregate amount of up to $104 million. Additional contingent payments are owed upon achievement of product approval or launch milestones.
We have committed to pay royalties to owners of know-how, partners in alliances and pursuant to certain other arrangements and to parties that financed research and development, at a wide range of rates as a percentage of sales or of the gross margin of certain products, as defined in the underlying agreements.
Due to the uncertainty of the timing of these payments, these amounts, and the amounts described in the previous paragraph, are not included in the table above.
Off-Balance Sheet Arrangements
We do not have any material off-balance sheet arrangements, except for: (i) surety underwritten guarantees Teva has provided the European Commission in an amount of 462.2 million euros, together with specified post-decision interest, which remain in force for three years, and which includes substantially similar covenants as our RCF, as disclosed in note 12b to our consolidated financial statements, and (ii) securitization transactions, which are disclosed in note 10f to our consolidated financial statements.
Non-GAAP Net Income and Non-GAAP EPS Data
We present non-GAAP net income and non-GAAP earnings per share (“EPS”) as management believes that such data provide useful information to investors because they are used by management and our Board of Directors, in conjunction with other performance metrics, to evaluate our operational performance, to prepare and evaluate our work plans and annual budgets and ultimately to evaluate the performance of management, including annual compensation. While other qualitative factors and judgment also affect annual compensation, the principal quantitative element in the determination of such compensation are performance targets tied to the work plan, which are based on these non-GAAP measures.
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Non-GAAP financial measures have no standardized meaning and accordingly have limitations in their usefulness to investors. Investors are cautioned that, unlike financial measures prepared in accordance with U.S. GAAP, non-GAAP measures may not be comparable with the calculation of similar measures for other companies. These non-GAAP financial measures are presented solely to permit investors to more fully understand how management assesses our performance. The limitations of using non-GAAP financial measures as performance measures are that they provide a view of our results of operations without including all events during a period and may not provide a comparable view of our performance to other companies in the pharmaceutical industry. Investors should consider non-GAAP net income and non-GAAP EPS in addition to, and not as replacements for, or superior to, measures of financial performance prepared in accordance with GAAP.
In preparing our non-GAAP net income and non-GAAP EPS data, we exclude items that either have a non-recurring impact on our financial performance or which, in the judgment of our management, are items that, either as a result of their nature or size, could, were they not excluded, potentially cause investors to extrapolate future performance from an improper base that is not reflective of our underlying business performance. Certain of these items are also excluded because of the difficulty in predicting their timing and scope. The items excluded from our non-GAAP net income and non-GAAP EPS include:
| • | amortization of purchased intangible assets; |
| • | certain legal settlements and material litigation fees and/or loss contingencies, due to the difficulty in predicting their timing and scope; |
| • | impairments of long-lived assets, including intangibles, property, plant and equipment and goodwill; |
| • | restructuring expenses, including severance, retention costs, contract cancellation costs and certain accelerated depreciation expenses primarily related to the rationalization of our plants or to certain other strategic activities, such as the realignment of R&D focus or other similar activities; |
| • | acquisition- or divestment- related items, including changes in contingent consideration, integration costs, banker and other professional fees and inventory step-up; |
| • | expenses related to our equity compensation; |
| • | significant one-time financing costs, amortization of issuance costs and terminated derivative instruments, and marketable securities investment valuation gains/losses; |
| • | unusual tax items; |
| • | other awards or settlement amounts, either paid or received; |
| • | other exceptional items that we believe are sufficiently large that their exclusion is important to facilitate an understanding of trends in our financial results, such as impacts due to changes in accounting, significant costs for remediation of plants, or other unusual events; and |
| • | corresponding tax effects of the foregoing items. |
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The following table presents our non-GAAP net income and non-GAAP EPS for the years ended December 31, 2025 and 2024, as well as reconciliations of each measure to their nearest GAAP equivalents:
| Year ended December 31, |
||||||||||||
| ($ in millions except per share amounts) | 2025 | 2024 | ||||||||||
| Net income (Loss) attributable to Teva |
($) | ($) | 1,410 | (1,639 | ) | |||||||
| Increase (decrease) for excluded items: |
||||||||||||
| Amortization of purchased intangible assets |
581 | 588 | ||||||||||
| Legal settlements and loss contingencies(1) |
473 | 761 | ||||||||||
| Goodwill impairment(2) |
— | 1,280 | ||||||||||
| Impairment of long-lived assets(3) |
1,029 | 1,275 | ||||||||||
| Restructuring costs(4) |
225 | 74 | ||||||||||
| Equity compensation |
157 | 123 | ||||||||||
| Contingent consideration(5) |
54 | 303 | ||||||||||
| Loss (Gain) on sale of business |
22 | (15 | ) | |||||||||
| Accelerated depreciation |
21 | 13 | ||||||||||
| Financial expenses |
69 | 49 | ||||||||||
| Items attributable to non-controlling interests(3) |
2 | (339 | ) | |||||||||
| Other non-GAAP items(6) |
186 | 229 | ||||||||||
| Corresponding tax effects and unusual tax items(7) |
(819 | ) | 157 | |||||||||
| Non-GAAP net income attributable to Teva |
($) | ($) | 3,411 | 2,860 | ||||||||
| Non-GAAP tax rate(8) |
15.8 | % | 15.3 | % | ||||||||
| GAAP diluted earnings (loss) per share attributable to Teva |
($) | ($) | 1.21 | (1.45 | ) | |||||||
| EPS difference(9) |
1.72 | 3.94 | ||||||||||
| Non-GAAP diluted EPS attributable to Teva(9) |
($) | ($) | 2.93 | 2.49 | ||||||||
| Non-GAAP average number of shares (in millions)(9) |
1,163 | 1,150 | ||||||||||
| (1) | Adjustments for legal settlements and loss contingencies in 2025 were mainly related to an update to the estimated settlement provision of $220 million for the opioid cases (mainly the effect of the passage of time on the net present value of the discounted payments), an update of $56 million related to the provision recorded for the carvedilol patent litigation, an update of $55 million related to the estimated provision recorded for the claims brought by attorneys general representing states and territories throughout the United States in the generic drug antitrust litigation, as well as a provision of $35 million recorded for the antitrust litigation related to QVAR. |
Adjustments for legal settlements and loss contingencies in 2024 were mainly related to legal expenses of $357 million recorded in connection with a decision by the European Commission in its antitrust investigation into COPAXONE, and an update to the estimated settlement provision of $278 million for the opioid cases (mainly the effect of the passage of time on the net present value of the discounted payments and the settlement agreement with the city of Baltimore).
| (2) | In 2024, goodwill impairment charges of $1,280 million were recorded related to our API reporting unit. |
| (3) | Adjustments for impairment of long-lived assets in 2025 were mainly related to a $726 million impairment charge in connection with a manufacturing facility in Europe. Adjustments for impairment of long-lived assets and items attributable to non-controlling interests in 2024 primarily consisted of $715 million and $342 million, respectively, related to the classification of our business venture in Japan as held for sale. In addition, in 2024 we recognized an impairment of $275 million related to the classification of our API business (including its R&D, manufacturing and commercial activities) as held for sale. |
| (4) | In 2025, Teva recorded $225 million of restructuring expenses primarily related to optimization activities in connection with Teva’s Transformation programs related to Teva’s global organization and operations, mainly through headcount reduction. |
| (5) | Adjustments in 2024 primarily related to a change in the estimated future royalty payments to Allergan in connection with lenalidomide capsules (the generic version of Revlimid®) of $270 million. |
| (6) | Other non-GAAP items include other exceptional items that we believe are sufficiently large that their exclusion is important to facilitate an understanding of trends in our financial results, primarily related to the rationalization of our plants, certain inventory write-offs, material litigation fees and other unusual events. |
| (7) | Adjustments for corresponding tax effects and unusual tax items in 2025 include an income tax item in an amount of $246 million related to a valuation allowance release in the U.S. |
Adjustments for corresponding tax effects and unusual tax items in 2024 include a tax item in an amount of $495 million related to the settlement agreement with the ITA to settle certain litigation with respect to taxes payable for the Company’s taxable years 2008 through 2020.
| (8) | Non-GAAP tax rate is tax expenses (benefit) excluding the impact of non-GAAP tax adjustments presented above as a percentage of income (loss) before income taxes excluding the impact of non-GAAP adjustments presented above. |
| (9) | EPS difference and diluted non-GAAP EPS are calculated by dividing our non-GAAP net income attributable to Teva by our non-GAAP diluted weighted average number of shares. |
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Trend Information
The following factors are expected to have a significant effect on our 2026 results:
| • | continued growth of our key innovative medicines AUSTEDO, AJOVY and UZEDY; |
| • | expanding and accelerating our innovative medicines and biosimilar pipeline, including by pursuing business development and other strategic opportunities; |
| • | ability to successfully execute key generic launches in a timely manner including high-value complex generic medicines, and to successfully develop and launch new biosimilar products; |
| • | continued competition for our generic products where multiple similar generic products have been launched, resulting in pricing pressure in the generics markets and lower revenues. We do, however, also see certain generic opportunities to grow our business, including our portfolio of new drug applications and our portfolio of approved complex products; |
| • | continued decline in sales of certain innovative medicines due to loss of exclusivity, generic competition and/or availability of alternative therapies; |
| • | ongoing impact of macroeconomic headwinds, imposition of tariffs and geopolitical tensions, including global supply chain disruptions as well as exchange rate fluctuations could continue to impact our production and distribution processes, product availability and ability to timely respond to consumer demand. For further details, see “—Macroeconomic Environment” above; |
| • | ongoing evaluation to further focus our business by optimizing our portfolio and global manufacturing footprint to achieve additional operational efficiencies, including potential divestitures, such as our intention to divest the Teva API business, which may affect our business and operations; |
| • | ongoing execution of our Teva Transformation programs, pursuant to which we expect to achieve cost savings through a variety of initiatives including examining practices and efficiencies in methods of working, reduction in headcount and optimizing external spend in the following years; |
| • | our continued financial discipline and debt repayment schedule; |
| • | continued payments related to litigation and tax settlements; |
| • | continued efforts towards achieving our long-term financial goals; and |
| • | continued improvement in our credit ratings by credit agencies. |
For additional information, please see “Item 1—Business” above and elsewhere in this Item 7.
Critical Accounting Policies
For a description of our significant accounting policies, see note 1 to our consolidated financial statements.
The preparation of our consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions in certain circumstances that affect the amounts reported in the accompanying consolidated financial statements and related footnotes. Actual results may differ from these estimates. We base our judgments on our experience and on various assumptions that we believe to be reasonable under the circumstances.
Of our policies, the following are considered critical to an understanding of our consolidated financial statements as they require the application of subjective and complex judgment, involving critical accounting estimates and assumptions impacting our consolidated financial statements. We have applied our policies and critical accounting estimates consistently across our businesses.
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The critical accounting estimates relate to the following:
| • | Revenue Recognition and SR&A in the United States |
| • | Income Taxes |
| • | Contingencies |
| • | Impairment of Property, Plant and Equipment |
Revenue Recognition and SR&A in the United States
Our gross product revenues are subject to a variety of deductions which are generally estimated and recorded in the same period that the revenues are recognized, and primarily represent chargebacks, rebates and sales allowances to wholesalers, retailers and government agencies with respect to our pharmaceutical products. Those deductions represent estimates of rebates and discounts related to gross sales for the reporting period and, as such, knowledge and judgment of market conditions and practice are required when estimating the impact of these revenue deductions on gross sales for a reporting period.
Historically, our changes of estimates reflecting actual results or updated expectations, have not been material to our overall business. Product-specific rebates, however, may have a significant impact on year-over-year individual product growth trends. If any of our ratios, factors, assessments, experiences or judgments are not indicative or accurate predictors of our future experience, our results could be materially affected. The sensitivity of our estimates can vary by program, type of customer and geographic location. However, estimates associated with governmental allowances, U.S. Medicaid and other performance-based contract rebates are most at risk for material adjustment because of the extensive time delay between the recording of the accrual and its ultimate settlement, an interval that can generally range up to one year. Because of this time lag, in any given quarter, our adjustments to actual can incorporate revisions of several prior quarters. See also “Revenue recognition” in note 1 to the consolidated financial statements.
Income Taxes
The provision for income tax is calculated based on our assumptions as to our entitlement to various benefits under the applicable tax laws in the jurisdictions in which we operate. The entitlement to such benefits depends upon our compliance with the terms and conditions set out in these laws.
Accounting for uncertainty in income taxes requires that it be more likely than not that the tax benefits recognized in the financial statements be sustained based on technical merits. The amount of benefits recorded for these positions is measured as the largest benefit more likely than not to be sustained. Significant judgment is required in making these determinations.
Deferred taxes are determined utilizing the asset and liability method based on the estimated future tax effects of differences between the financial accounting and tax bases of assets and liabilities under the applicable tax laws. Valuation allowances are provided if, based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. In the determination of the appropriate valuation allowances, we have considered the most recent projections of future business results and prudent tax planning alternatives that may allow us to realize the deferred tax assets. Taxes which would apply in the event of disposal of investments in subsidiaries have not been taken into account in computing deferred taxes, as it is our intention to hold these investments rather than realize them.
Taxes have not been provided for tax-exempt income, as the Company intends to permanently reinvest these earnings and does not currently foresee a need to distribute dividends out of these earnings. In addition, the Company announced a suspension of dividend distribution on ordinary shares and ADSs in 2017. Furthermore, deferred taxes have not been provided for the retained earnings of the Company’s foreign subsidiaries because
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the Company does not expect these subsidiaries to distribute taxable dividends in the foreseeable future, as their earnings and excess cash are used to pay down the group’s external liabilities, and the Company expects to have sufficient resources in the Israeli companies to fund its cash needs in Israel. An assessment of the tax that would have been payable had the Company’s foreign subsidiaries distributed their income to the Company is not practicable because of the multiple levels of corporate ownership and multiple tax jurisdictions involved in each hypothetical dividend distribution.
For a discussion of the uncertain tax positions, deferred tax and valuation allowance estimates see notes 1 and 13 to our consolidated financial statements.
Contingencies
From time to time, Teva and/or its subsidiaries are subject to claims for damages and/or equitable relief arising in the ordinary course of business. In addition, in large part as a result of the nature of its business, Teva is frequently subject to litigation, governmental investigations and other legal proceedings. Except for income tax contingencies or contingent consideration acquired in a business combination, Teva records a provision in its consolidated financial statements to the extent that it concludes that a contingent liability is probable and the amount thereof is reasonably estimable. When accruing these costs, Teva will recognize an accrual in the amount within a range of loss that is the best estimate within the range. When no amount within the range is a better estimate than any other amount, Teva accrues for the minimum amount within the range. Teva records anticipated recoveries under existing insurance contracts at the gross amount that is expected to be collected when they are considered probable to occur.
Teva reviews the adequacy of the accruals on a periodic basis and, although it believes that its present reserves are adequate, changes in facts and circumstances in the future may lead to adjustments to reserve estimates and could have a material impact on Teva’s results of operations, cash flows and financial condition in the period that reserve estimates are adjusted or paid. As such accruals are based on management’s judgment as to the probability of losses and, where applicable, actuarially determined estimates, accruals may materially differ from actual verdicts, settlements or other agreements made with regards to such contingencies. Litigation outcomes and contingencies are unpredictable and excessive verdicts can occur. Accordingly, management’s assessments involve complex judgments concerning future events and often rely heavily on estimates and assumptions.
Impairment of Property, Plant and Equipment
The Company assesses changes in economic, regulatory and legal conditions and makes assumptions regarding estimated future cash flows in evaluating the value of the Company’s property, plant and equipment.
The Company periodically evaluates whether current facts or circumstances indicate that the carrying values of its property, plant and equipment assets to be held and used may not be recoverable. If such circumstances are determined to exist, an estimate of the undiscounted future cash flows of these assets, or appropriate asset groupings, is compared to the carrying value to determine whether an impairment exists. If the asset is determined to be impaired, the loss is measured based on the difference between the asset’s fair value and its carrying value. If quoted market prices are not available, the Company will estimate fair value using a discounted value of estimated future cash flows approach.
Recently Issued Accounting Pronouncements
See note 1 to our consolidated financial statements.
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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
General
The objective of our financial risk management measures is to minimize the impact of risks arising from foreign exchange and interest rate fluctuations. To reduce these risks, we take various operational measures in order to achieve a natural hedge and may enter, from time to time, into financial derivative instruments. Our derivative transactions are executed under International Swaps and Derivatives Association, Inc. (“ISDA”) master agreements with global banks under agreed terms and conditions that mitigate credit risk. We also believe that due to our diversified derivatives portfolio, the credit risk associated with any of these banks is minimal. No derivative instruments are entered into for trading purposes.
Exchange Rate Risk Management
We operate our business worldwide and, as such, we are subject to foreign exchange risks on our results of operations, our monetary assets and liabilities and our foreign subsidiaries’ net assets. For further information on currencies in which we operate, see “Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations—Impact of Currency Fluctuations on Results of Operations.”
We generally prefer to borrow in U.S. dollars or euros; however, from time to time we borrow funds in other currencies, such as the Swiss franc, in order to benefit from same currency revenues in relation to same currency costs and same currency assets in relation to same currency liabilities.
Cash Flow Exposure
Our total revenues were $17,258 million in 2025. Of these revenues, approximately 43% were denominated in currencies other than the U.S. dollar, of which 20% in euros and the rest in other currencies, none of which accounted for more than 3% of total revenues in 2025. In most currencies, we recorded corresponding expenses.
In certain currencies, primarily the euro, our revenues generally exceed our expenses. Conversely, in other currencies, primarily the new Israeli shekel and the Indian rupee, our expenses generally exceed our revenues.
We enter into financial derivatives to hedge part of those currencies which do not have a sufficient natural hedge, in order to reduce the impact of foreign exchange fluctuations on our operating results.
As of December 31, 2025, we hedged part of our expected operating results for 2026 in currencies other than the U.S. dollar, primarily the British pound, Canadian dollar, Swiss franc, Russian ruble, Polish złoty, Indian rupee and Israeli shekel.
In certain cases, we may hedge exposure arising from a specific transaction, executed in a currency other than the functional currency, by entering into forward contracts and/or by using plain-vanilla and exotic option strategies. We generally limit the term of hedging transactions to a maximum of eighteen months.
Balance Sheet Exposure
With respect to our monetary assets and liabilities, the exposure arises when the monetary assets and/or liabilities are denominated in currencies other than the functional currency of our subsidiaries. We strive to limit our exposure through natural hedging. The remaining exposure is hedged almost in full by entering into financial derivative instruments. To the extent possible, the hedging activity is carried out on a consolidated level.
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The table below presents exposures exceeding $50 million in absolute values:
| Net exposure as of December 31, 2025 |
||||
| Liability/Asset | (U.S. $ in millions) | |||
| ILS/USD |
823 | |||
| GBP/EUR |
538 | |||
| JPY/USD |
286 | |||
| CHF/USD |
250 | |||
| CHF/EUR |
219 | |||
| EUR/USD |
216 | |||
| GBP/USD |
101 | |||
| EUR/CAD |
88 | |||
| USD/MXN |
63 | |||
| HUF/USD |
52 | |||
| USD/PLN |
51 | |||
Outstanding Foreign Exchange Hedging Transactions
As of December 31, 2025 and 2024, we had outstanding derivatives, primarily forwards contracts, with a corresponding notional amount of approximately $3.35 billion and $3.9 billion, respectively.
The table below presents the net notional and fair values of the financial derivatives entered into as of December 31, 2025, in order to reduce currency exposure arising from our cash flow and balance sheet exposures. The table below presents only currency paired with hedged net notional values exceeding $50 million.
| Currency (sold) |
Cross Currency (bought) |
Net Notional Value |
Fair Value | 2025 Weighted Average Cross Currency Prices or Strike Prices |
||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||||
| (U.S. $ in millions) | ||||||||||||||||||||||||
| Forward: |
||||||||||||||||||||||||
| USD |
ILS | 971 | 857 | 64 | 7 | 3.40 | ||||||||||||||||||
| EUR |
GBP | 538 | 646 | 3 | 5 | 0.88 | ||||||||||||||||||
| USD |
JPY | 277 | (306 | ) | (3 | ) | 11 | 150.61 | ||||||||||||||||
| EUR |
CHF | 219 | 300 | (1 | ) | (3 | ) | 0.92 | ||||||||||||||||
| PLN |
USD | 135 | (117 | ) | (2 | ) | 3 | 3.64 | ||||||||||||||||
| USD |
CHF | 134 | (118 | ) | 3 | 5 | 0.79 | |||||||||||||||||
| USD |
EUR | 121 | (236 | ) | — | (2 | ) | 1.18 | ||||||||||||||||
| CAD |
EUR | 88 | (61 | ) | (1 | ) | — | 1.62 | ||||||||||||||||
| RUB |
USD | 88 | 49 | (7 | ) | 5 | 92.34 | |||||||||||||||||
| USD |
INR | 71 | 179 | (3 | ) | (2 | ) | 87.91 | ||||||||||||||||
| USD |
HUF | 68 | (14 | ) | 1 | (1 | ) | 337.82 | ||||||||||||||||
| MXN |
USD | 63 | 69 | (2 | ) | 1 | 18.58 | |||||||||||||||||
| SEK |
USD | 62 | 87 | (1 | ) | 2 | 9.32 | |||||||||||||||||
| CAD |
USD | 59 | 116 | 1 | 3 | 1.36 | ||||||||||||||||||
Foreign Subsidiaries Net Assets
Under certain market conditions, we may hedge against possible fluctuations in foreign subsidiaries’ net assets (“net investment hedge”). In these cases, we may use cross currency swaps and forward contracts.
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Interest Rate Risk Management
We are subject to interest rate risk on our investments and on our borrowings. We manage interest rate risk in the aggregate, while focusing on our immediate and intermediate liquidity needs.
We raise capital through various debt instruments including senior notes, sustainability-linked senior notes, and convertible debentures that bear fixed or variable interest rates, as well as a syndicated sustainability-linked revolving credit facility and securitization programs that bear a variable interest rate. In some cases, we have swapped from a fixed to a variable interest rate (“fair value hedge”), from a variable to a fixed interest rate and from a fixed to a fixed interest rate with an exchange from a currency other than the functional currency (“cash flow hedge”), reducing overall interest expenses or hedging risks associated with interest rate fluctuations. As of December 31, 2025, all outstanding senior notes, sustainability-linked senior notes and convertible debentures bear a fixed interest rate.
In certain cases, we may hedge, in whole or in part, against exposure arising from a specific transaction, such as debt issuances related to an acquisition or debt refinancing, by entering into forward and interest rate swap contracts and/or by using options.
The table below presents the aggregate outstanding debt by currencies and maturities as of December 31, 2025:
| Currency |
Total Amount |
Interest Rate Ranges |
2026 | 2027 | 2028 | 2029 | 2030 | 2031 & thereafter |
||||||||||||||||||||||||||||
| (U.S. dollars in millions) | ||||||||||||||||||||||||||||||||||||
| Fixed Rate: |
||||||||||||||||||||||||||||||||||||
| USD |
9,559 | 3.15 | % | 8.13 | % | 1,798 | 649 | 1,250 | 1,398 | 696 | 3,768 | |||||||||||||||||||||||||
| Euro |
7,291 | 1.63 | % | 7.88 | % | — | 2,115 | 880 | 779 | 1,762 | 1,755 | |||||||||||||||||||||||||
| USD convertible debentures |
23 | 0.25 | % | 0.25 | % | 23 | — | — | — | — | — | |||||||||||||||||||||||||
| Variable Rate: |
||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
| Total: |
16,873 | $ | 1,821 | $ | 2,764 | $ | 2,130 | $ | 2,177 | $ | 2,458 | $ | 5,523 | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
| Less debt issuance costs |
(66 | ) | ||||||||||||||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||||||||||||||
| Total: |
$ | 16,807 | ||||||||||||||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||||||||||||||
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ITEM 8. |
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA |
Page |
||||
| Report of Independent Registered Public Accounting Firm (PCAOB name: |
89 | |||
| Consolidated Financial Statements: |
||||
| Balance sheets |
92 |
|||
| Statements of income |
93 | |||
| Statements of comprehensive income (loss) |
94 |
|||
| Statements of changes in equity |
95 |
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| Statements of cash flows |
96 |
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| Notes to consolidated financial statements |
98 |
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| Financial Statement Schedule: |
||||
| Schedule II—Valuation and Qualifying Accounts |
176 |
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December 31, 2025 |
December 31, 2024 |
|||||||
| ASSETS |
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| Current assets: |
||||||||
| Cash and cash equivalents |
$ | $ | ||||||
| Accounts receivables, net of allowance for credit losses of $ |
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| Inventories |
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| Prepaid expenses |
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| Other current assets |
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| Assets held for sale |
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| Total current assets |
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| Deferred income taxes |
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| Other non-current assets |
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| Property, plant and equipment, net |
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| Operating lease right-of-use |
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| Identifiable intangible assets, net |
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| Goodwill |
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| Total assets |
$ | $ | ||||||
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| LIABILITIES AND EQUITY |
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| Current liabilities: |
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| Short-term debt |
$ | $ | ||||||
| Sales reserves and allowances |
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| Accounts payables |
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| Employee-related obligations |
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| Accrued expenses |
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| Other current liabilities |
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| Liabilities held for sale |
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| Total current liabilities |
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| Long-term liabilities: |
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| Deferred income taxes |
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| Other taxes and long-term liabilities |
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| Senior notes and loans |
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| Operating lease liabilities |
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| Total long-term liabilities |
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| Commitments and contingencies |
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| Total liabilities |
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| Redeemable non-controlling interests |
— |
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|||||
| Equity: |
||||||||
| Teva shareholders’ equity: |
||||||||
| Ordinary shares of NIS |
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| Additional paid-in capital |
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| Accumulated deficit |
( |
) | ( |
) | ||||
| Accumulated other comprehensive loss |
( |
) | ( |
) | ||||
| Treasury shares as of December 31, 2025 and December 31, 2024: |
( |
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| Non-controlling interests |
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| Total equity |
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| Total liabilities, redeemable non-controlling interests and equity |
$ | $ | ||||||
| |
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Year ended December 31, |
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2025 |
2024 |
2023 |
||||||||||
| Net revenues |
$ | $ | $ | |||||||||
| Cost of sales |
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| Gross profit |
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| Research and development expenses, net |
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| Selling and marketing expenses |
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| General and administrative expenses |
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| Intangible assets impairments |
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| Goodwill impairment |
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| Other asset impairments, restructuring and other items |
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| Legal settlements and loss contingencies |
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| Other loss (income) |
( |
) | ( |
) | ||||||||
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| Operating income (loss) |
( |
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| Financial expenses – net |
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| Income (loss) before income taxes |
( |
) | ( |
) | ||||||||
| Income taxes (benefit) |
( |
) | ( |
) | ||||||||
| Share in (profits) losses of associated companies – net |
( |
) | ( |
) | ( |
) | ||||||
| |
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| Net income (loss) |
( |
) | ( |
) | ||||||||
| Net income (loss) attributable to redeemable and non-redeemable non-controlling interests |
( |
) | ( |
) | ||||||||
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| Net income (loss) attributable to Teva |
( |
) | ( |
) | ||||||||
| |
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| Earnings (loss) per share attributable to ordinary shareholders: |
||||||||||||
| Basic |
$ | $ | ( |
) | $ | ( |
) | |||||
| |
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| Diluted |
$ | $ | ( |
) | $ | ( |
) | |||||
| |
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| Weighted average number of shares (in millions): |
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| Basic |
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| Diluted |
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Year ended December 31, |
||||||||||||
2025 |
2024 |
2023 |
||||||||||
| Net income (loss) |
$ | $ | ( |
) | $ | ( |
) | |||||
| Other comprehensive income (loss), net of tax: |
||||||||||||
| Currency translation adjustment |
( |
) | ||||||||||
| Unrealized gain (loss) on derivative financial instruments, net |
||||||||||||
| Unrealized gain (loss) on defined benefit plans, net |
( |
) | ( |
) | ||||||||
| |
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|||||||
| Total other comprehensive income (loss) |
( |
) | ||||||||||
| |
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|||||||
| Total comprehensive income (loss) |
( |
) | ( |
) | ||||||||
| Comprehensive income (loss) attributable to redeemable and non-redeemable non-controlling interests |
( |
) | ( |
) | ||||||||
| |
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|||||||
| Comprehensive income (loss) attributable to Teva |
$ | $ | ( |
) | $ | ( |
) | |||||
| |
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Teva shareholders’ equity |
||||||||||||||||||||||||||||||||||||
Ordinary shares |
||||||||||||||||||||||||||||||||||||
Number of shares (in millions) |
Stated value |
Additional paid-in capital |
Retained earnings (accumulated deficit) |
Accumulated other comprehensive income (loss) |
Treasury shares |
Total Teva share- holders’ equity |
Non-controlling interests |
Total equity |
||||||||||||||||||||||||||||
(U.S. dollars in millions) |
||||||||||||||||||||||||||||||||||||
| Balance at January 1, 2023 |
( |
) | ( |
) | ( |
) | ||||||||||||||||||||||||||||||
| Changes during 2023: |
||||||||||||||||||||||||||||||||||||
| Net income (loss) |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||||||||||||||||||
| Other comprehensive income (loss) |
( |
) | ||||||||||||||||||||||||||||||||||
| Issuance of shares |
* | * | * | * | ||||||||||||||||||||||||||||||||
| Stock-based compensation expense |
||||||||||||||||||||||||||||||||||||
| Dividend to non-controlling interests** |
( |
) | ( |
) | ||||||||||||||||||||||||||||||||
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|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| Balance at December 31, 2023 |
( |
) | ( |
) | ( |
) | ||||||||||||||||||||||||||||||
| Changes during 2024: |
||||||||||||||||||||||||||||||||||||
| Net income (loss) |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||||||||||||||||||
| Other comprehensive income (loss) |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||||||||||||||||||
| Issuance of shares |
* | |||||||||||||||||||||||||||||||||||
| Stock-based compensation expense |
||||||||||||||||||||||||||||||||||||
| Proceeds from exercise of options |
||||||||||||||||||||||||||||||||||||
| Dividend to non-controlling interests** |
( |
) | ( |
) | ||||||||||||||||||||||||||||||||
| Purchase of shares from non-controlling interests*** |
( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||||||||||||||||
| Reclassification to redeemable non-controlling interests**** |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| Balance at December 31, 2024 |
( |
) | ( |
) | ( |
) | ||||||||||||||||||||||||||||||
| Changes during 2025: |
||||||||||||||||||||||||||||||||||||
| Net income (loss) |
||||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss) |
||||||||||||||||||||||||||||||||||||
| Issuance of shares |
* | * | ||||||||||||||||||||||||||||||||||
| Stock-based compensation expense |
||||||||||||||||||||||||||||||||||||
| Proceeds from exercise of options |
||||||||||||||||||||||||||||||||||||
| Purchase of shares from redeemable non-controlling interests**** |
||||||||||||||||||||||||||||||||||||
| Dividend to non-controlling interests***** |
( |
) | ( |
) | ||||||||||||||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| Balance at December 31, 2025 |
$ | $ | $ | ( |
) | $ | ( |
) | $ | ( |
) | $ | $ | $ | ||||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| * | Represents an amount less than $ |
| ** | Mainly in connection with a declaration of dividends to non-controlling interests in Teva’s business venture in Japan. |
| *** | Purchase of shares from non-controlling interests in a Teva’s subsidiary in Switzerland. |
| **** | In connection with the sale of Teva’s business venture in Japan. See note 22. |
| ***** | In connection with a declaration of dividends to non-controlling interests in Teva’s subsidiary in Bulgaria. |
Year ended December 31, |
||||||||||||
2025 |
2024 |
2023 |
||||||||||
| Operating activities: |
||||||||||||
| Net income (loss) |
$ | $ | ( |
) | $ | ( |
) | |||||
| Adjustments to reconcile net income (loss) to net cash provided by operations: |
||||||||||||
| Impairment of goodwill |
||||||||||||
| Impairment of long-lived assets and assets held for sale |
||||||||||||
| Depreciation and amortization |
||||||||||||
| Net change in operating assets and liabilities |
( |
) | ( |
) | ( |
) | ||||||
| Deferred income taxes — net and uncertain tax positions |
( |
) | ( |
) | ( |
) | ||||||
| Stock-based compensation |
||||||||||||
| Net loss (gain) from sale of business and long-lived assets |
( |
) | ( |
) | ||||||||
| Other items, net * |
||||||||||||
| |
|
|
|
|
|
|||||||
| Net cash provided by (used in) operating activities |
||||||||||||
| |
|
|
|
|
|
|||||||
| Investing activities: |
||||||||||||
| Beneficial interest collected in exchange for securitized trade receivables |
||||||||||||
| Purchases of property, plant and equipment and intangible assets |
( |
) | ( |
) | ( |
) | ||||||
| Proceeds from sale of business and long-lived assets |
||||||||||||
| Purchases of investments and other assets |
( |
) | ( |
) | ( |
) | ||||||
| Proceeds from sale of investments |
||||||||||||
| Acquisitions of businesses, net of cash acquired |
( |
) | ||||||||||
| Other investing activities |
( |
) | ||||||||||
| |
|
|
|
|
|
|||||||
| Net cash provided by (used in) investing activities |
||||||||||||
| |
|
|
|
|
|
|||||||
| Financing activities: |
||||||||||||
| Repayment of senior notes and loans and other long-term liabilities |
( |
) | ( |
) | ( |
) | ||||||
| Proceeds from senior notes, net of issuance costs |
||||||||||||
| Proceeds from short term debt |
||||||||||||
| Repayment of short-term debt |
( |
) | ||||||||||
| Purchase of shares from redeemable and non-redeemable non-controlling interests |
( |
) | ( |
) | ||||||||
| Dividends paid to redeemable and non-redeemable non-controlling interests |
( |
) | ( |
) | ||||||||
| Other financing activities |
( |
) | ( |
) | ||||||||
| |
|
|
|
|
|
|||||||
| Net cash provided by (used in) financing activities |
( |
) | ( |
) | ( |
) | ||||||
| |
|
|
|
|
|
|||||||
| Translation adjustment on cash, cash equivalents and restricted cash |
( |
) | ( |
) | ||||||||
| |
|
|
|
|
|
|||||||
| Net change in cash, cash equivalents and restricted cash |
||||||||||||
| Balance of cash, cash equivalents and restricted cash at beginning of year |
||||||||||||
| |
|
|
|
|
|
|||||||
| Balance of cash, cash equivalents and restricted cash at end of year |
$ | $ | $ | |||||||||
| |
|
|
|
|
|
|||||||
| Reconciliation of cash, cash equivalents and restricted cash reported in the consolidated balance sheets: |
||||||||||||
| Cash and cash equivalents |
||||||||||||
| Restricted cash included in other current assets |
||||||||||||
| |
|
|
|
|
|
|||||||
| Total cash, cash equivalents and restricted cash shown in the statement of cash flows |
||||||||||||
| |
|
|
|
|
|
|||||||
| * | “Other items, net” in the year ended December 31, 2024 includes mainly amounts related to an agreement with the Israeli Tax Authorities. |
Year ended December 31, |
||||||||||||
2025 |
2024 |
2023 |
||||||||||
| Non-cash financing and investing activities: |
||||||||||||
| Beneficial interest obtained in exchange for securitized trade receivables |
$ | $ | $ | |||||||||
| Dividend declared to non-controlling interests |
$ | $ | ||||||||||
| Cash paid during the year for: |
||||||||||||
| Interest |
$ | $ | $ | |||||||||
Year ended December 31, |
||||||||||||
2025 |
2024 |
2023 |
||||||||||
| Other assets |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||
| Trade payables, accrued expenses, employee-related obligations and other liabilities |
( |
) | ||||||||||
| Trade receivables net of sales reserves and allowances |
( |
) | ||||||||||
| Inventories |
( |
) | ||||||||||
| |
|
|
|
|
|
|||||||
| $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
| |
|
|
|
|
|
|||||||
a. |
General: |
b. |
New accounting pronouncements |
c. |
Acquisitions: |
d. |
Collaborative arrangements: |
e. |
Equity securities: |
f. |
Fair value measurement: |
g. |
Cash and cash equivalents: |
h. |
Restricted cash: |
i. |
Accounts Receivables: |
j. |
Concentration of credit risks: |
k. |
Inventories: |
l. |
Long-lived assets, other indefinite-lived intangible assets and goodwill: |
1. |
An initial qualitative assessment may be performed to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount. |
2. |
If Teva concludes it is more likely than not that the fair value of the reporting unit is less than its carrying amount, a quantitative fair value test is performed. An impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value is recognized. |
m. |
Contingencies: |
n. |
Treasury shares: |
o. |
Stock-based compensation: |
p. |
Deferred income taxes: |
q. |
Uncertain tax positions: |
r. |
Derivatives and hedging: |
s. |
Revenue recognition: |
t. |
Research and development: |
u. |
Advertising costs: |
v. |
Restructuring: |
w. |
Segment reporting: |
| (a) | United States segment. |
| (b) | Europe segment, which includes the European Union, the United Kingdom and certain other European countries. |
| (c) | International Markets segment, which includes all countries in which Teva operates other than those in the United States and Europe segments. |
x. |
Earnings per share: |
y. |
Securitization and factoring |
z. |
Supplier finance program |
aa. |
Divestitures |
bb. |
Debt instruments |
cc. |
Leases |
December 31, |
December 31, |
|||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
||||||||
| Accounts receivables |
$ | |||||||
| Inventories |
$ | |||||||
| Property, plant and equipment, net |
||||||||
| Identifiable intangible assets, net |
||||||||
| Goodwill |
||||||||
| Other current assets |
||||||||
| Other non-current assets |
||||||||
| Expected loss on sale* |
( |
) | ( |
) | ||||
| |
|
|
|
|||||
| Total assets of the disposal group classified as held for sale in the consolidated balance sheets |
$ | $ | ||||||
| |
|
|
|
|||||
| Accounts payables |
( |
) | ( |
) | ||||
| Other current liabilities |
( |
) | ( |
) | ||||
| Other non-current liabilities |
( |
) | ( |
) | ||||
| Expected loss on sale* |
( |
) | ||||||
| |
|
|
|
|||||
| Total liabilities of the disposal group classified as held for sale in the consolidated balance sheets |
$ | ( |
) | $ | ( |
) | ||
| |
|
|
|
|||||
| * | Includes an expected loss from reclassification of currency translation adjustments to the consolidated statements of income (loss) upon sale. |
Year ended December 31, 2025 |
||||||||||||||||||||
United States |
Europe |
International Markets |
Other Activities |
Total |
||||||||||||||||
(U.S.$ in millions) |
||||||||||||||||||||
| Sale of goods |
||||||||||||||||||||
| Licensing arrangements* |
||||||||||||||||||||
| Distribution |
||||||||||||||||||||
| Other** |
||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| $ | $ | $ | $ | $ | ||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| * | Revenues from licensing arrangements in United States segment were mainly comprised of development milestone payments of $the fourth quarter of 2025, in connection with the initiation of Phase 3 studies for duvakitug ( anti-TL1A). See note 2. |
| ** | “Other” revenues in Europe and International Markets segments include revenues related to sales of certain product rights. |
Year ended December 31, 2024 |
||||||||||||||||||||
United States |
Europe |
International Markets |
Other Activities |
Total |
||||||||||||||||
(U.S.$ in millions) |
||||||||||||||||||||
| Sale of goods |
||||||||||||||||||||
| Licensing arrangements |
||||||||||||||||||||
| Distribution |
||||||||||||||||||||
| Other* |
||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| $ | $ | $ | $ | $ | ||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| * | “Other” revenues in United States, Europe and International Markets segments include revenues related to sales of certain product rights. |
Year ended December 31, 2023 |
||||||||||||||||||||
United States |
Europe |
International Markets |
Other Activities |
Total |
||||||||||||||||
(U.S.$ in millions) |
||||||||||||||||||||
| Sale of goods |
||||||||||||||||||||
| Licensing arrangements* |
||||||||||||||||||||
| Distribution |
§ | |||||||||||||||||||
| Other** |
||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| $ | $ | $ | $ | $ | ||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| * | Revenues from licensing arrangements in United States segment were mainly comprised of $ |
| ** | “Other” revenues in Europe segment mainly related to the sale of certain product rights. |
| § | Represents an amount less than $0.5 million. |
Sales Reserves and Allowances |
||||||||||||||||||||||||||||||||
Reserves included in Accounts Receivable, net |
Rebates |
Medicaid and other governmental allowances |
Chargebacks |
Returns |
Other |
Total reserves included in Sales Reserves and Allowances |
Total |
|||||||||||||||||||||||||
(U.S.$ in millions) |
||||||||||||||||||||||||||||||||
| Balance at January 1, 2025 |
$ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| Provisions related to sales made in current year period |
||||||||||||||||||||||||||||||||
| Provisions related to sales made in prior periods |
( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||||||||||
| Credits and payments |
( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||||||
| Translation differences |
||||||||||||||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Balance at December 31, 2025 |
$ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Sales Reserves and Allowances |
||||||||||||||||||||||||||||||||
Reserves included in Accounts Receivable, net |
Rebates |
Medicaid and other governmental allowances |
Chargebacks |
Returns |
Other |
Total reserves included in Sales Reserves and Allowances |
Total |
|||||||||||||||||||||||||
(U.S.$ in millions) |
||||||||||||||||||||||||||||||||
| Balance at January 1, 2024 |
$ | $ | $ | |||||||||||||||||||||||||||||
| Provisions related to sales made in current year period |
||||||||||||||||||||||||||||||||
| Provisions related to sales made in prior periods |
( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||||||||||||
| Credits and payments |
( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||||||
| Translation differences |
( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Balance at December 31, 2024 |
$ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
December 31, |
||||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
||||||||
| Finished products |
$ | $ | ||||||
| Raw and packaging materials |
||||||||
| Products in process |
||||||||
| Materials in transit and payments on account |
||||||||
| |
|
|
|
|||||
| $ | $ | |||||||
| |
|
|
|
|||||
December 31, |
||||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
||||||||
| Machinery and equipment |
$ | $ | ||||||
| Buildings |
||||||||
| Internal-use software, computer equipment and other assets |
||||||||
| Assets under construction and payments on account |
||||||||
| Land |
||||||||
| |
|
|
|
|||||
| Less- accumulated depreciation |
( |
) | ( |
) | ||||
| |
|
|
|
|||||
| $ | $ | |||||||
| |
|
|
|
|||||
Gross carrying amount net of impairment |
Accumulated amortization |
Net carrying amount |
||||||||||||||||||||||
December 31, |
||||||||||||||||||||||||
2025 |
2024 |
2025 |
2024 |
2025 |
2024 |
|||||||||||||||||||
(U.S. $ in millions) |
||||||||||||||||||||||||
| Product rights |
$ | $ | $ | $ | $ | $ | ||||||||||||||||||
| Trade names |
||||||||||||||||||||||||
| In-process research and development (IPR&D) |
||||||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total |
$ | $ | $ | $ | $ | $ | ||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| (a) | Identifiable product rights of $ |
| (b) | IPR&D assets of $ |
| (a) | Identifiable product rights of $ |
| (b) | IPR&D assets of $ |
| (a) | Identifiable product rights of $ |
| (b) | IPR&D assets of $ |
North America |
United States |
Europe |
International Markets |
Other |
Total |
|||||||||||||||||||||||
Teva’s API |
Medis |
|||||||||||||||||||||||||||
(U.S. $ in millions) |
||||||||||||||||||||||||||||
| Balance as of December 31, 2023 (1) |
$ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||
| Goodwill allocation related to the shift of Canada to International Markets |
( |
) | ||||||||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Balance as of January 1, 2024 |
$ | — | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Other changes during the period: |
||||||||||||||||||||||||||||
| Goodwill impairment |
( |
) | ( |
) | ||||||||||||||||||||||||
| Goodwill reclassified as assets held for sale |
( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||||||||
| Translation differences and other |
( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Balance as of December 31, 2024 (1) |
$ | — | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Goodwill reclassified as assets held for sale |
( |
) | ( |
) | ||||||||||||||||||||||||
| Translation differences and other |
||||||||||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Balance as of December 31, 2025 (1) |
$ | — | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| (1) | Cumulative goodwill impairment as of December 31, 2025, 2024 and 2023, was approximately $ |
Year ended December 31, |
Year ended December 31, |
Year ended December 31, |
||||||||||
2025 |
2024 |
2023 |
||||||||||
(U.S. $ in millions) |
(U.S. $ in millions) |
(U.S. $ in millions) |
||||||||||
| Operating lease cost: |
||||||||||||
| Fixed payments and variable payments that depend on an index or rate |
||||||||||||
| Variable lease payments not included in the lease liability |
||||||||||||
| Short-term lease cost |
||||||||||||
| |
|
|
|
|
|
|||||||
| $ | $ | $ | ||||||||||
| |
|
|
|
|
|
|||||||
Year ended December 31, |
Year ended December 31, |
Year ended December 31, |
||||||||||
2025 |
2024 |
2023 |
||||||||||
(U.S. $ in millions) |
(U.S. $ in millions) |
(U.S. $ in millions) |
||||||||||
| Cash paid for amounts included in the measurement of lease liabilities: |
||||||||||||
| Operating cash flows from operating leases |
$ | $ | $ | |||||||||
| Right-of-use (non-cash): |
||||||||||||
| Operating leases |
$ | $ | $ | |||||||||
December 31, |
December 31, |
|||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
(U.S. $ in millions) |
|||||||
| Operating leases: |
||||||||
| Operating lease ROU assets |
$ | $ | ||||||
| |
|
|
|
|||||
| Other current liabilities |
||||||||
| Operating lease liabilities |
||||||||
| |
|
|
|
|||||
| Total operating |
$ | $ | ||||||
| |
|
|
|
|||||
December 31, |
December 31, |
|||||||
2025 |
2024 |
|||||||
| Weighted average remaining lease term |
||||||||
| Operating leases |
||||||||
| Weighted average discount rate |
||||||||
| Operating leases |
% | % | ||||||
December 31, |
||||
2025 |
||||
(U.S. $ in millions) |
||||
2026 |
||||
2027 |
||||
2028 |
||||
2029 |
||||
2030 and thereafter |
||||
Total operating lease payments |
$ | |||
Less: imputed interest |
||||
Present value of lease liabilities |
$ | |||
a. |
Short-term debt: |
Weighted average interest rate as of December 31, 2025 |
December 31, |
|||||||||||||||
Maturity |
2025 |
2024 |
||||||||||||||
(U.S. $ in millions) |
||||||||||||||||
Convertible debentures |
% | $ | $ | |||||||||||||
Current maturities of long-term liabilities |
||||||||||||||||
Total short-term debt |
$ | $ | ||||||||||||||
b. |
Long-term debt: |
Interest rate as of December 31, 2025 |
Maturity |
December 31, 2025 |
December 31, 2024 |
|||||||||||||
(U.S. $ in millions) |
||||||||||||||||
Senior notes EUR |
% | |||||||||||||||
Senior notes USD |
% | |||||||||||||||
Senior notes EUR |
% | |||||||||||||||
Senior notes CHF |
% | |||||||||||||||
Senior notes USD |
% | |||||||||||||||
Senior notes EUR |
% | |||||||||||||||
Sustainability-linked senior notes USD |
% | |||||||||||||||
Sustainability-linked senior notes EUR |
% | |||||||||||||||
Senior notes USD |
% | |||||||||||||||
Senior notes EUR |
% | |||||||||||||||
Sustainability-linked senior notes USD |
% | |||||||||||||||
Sustainability-linked senior notes USD |
% | |||||||||||||||
Sustainability-linked senior notes EUR |
% | |||||||||||||||
Sustainability-linked senior notes EUR |
% | |||||||||||||||
Senior notes USD |
% | — | ||||||||||||||
Sustainability-linked senior notes USD |
% | |||||||||||||||
Sustainability-linked senior notes EUR |
% | |||||||||||||||
Senior notes EUR |
% | — | ||||||||||||||
Senior notes USD |
% | — | ||||||||||||||
Senior notes USD |
% | |||||||||||||||
Senior notes USD |
% | |||||||||||||||
Total senior notes |
||||||||||||||||
Less current maturities |
( |
) | ( |
) | ||||||||||||
Less debt issuance costs (11) |
( |
) | ( |
) | ||||||||||||
Total senior notes and loans |
$ | $ | ||||||||||||||
(1) |
If Teva fails to achieve certain sustainability performance targets, a one-time premium payment of - . |
(2) |
If Teva fails to achieve certain sustainability performance targets, the interest rate shall increase by - |
(3) |
If Teva fails to achieve certain sustainability performance targets, the interest rate shall increase by - |
(4) |
In January 2025, Teva repaid $ million of th e % senior notes due 2025 at maturity. |
(5) |
In January 2025, Teva repaid $ million of the % senior notes due 2025 at maturity. |
(6) |
In March 2025, Teva repaid $ million of the % senior notes due 2025 at maturity. |
(7) |
In May 2025, Teva issued senior notes in an aggregate principal amount of $ million bearing % annual interest and due December 2030 . |
(8) |
In May 2025, Teva issued senior notes in an aggregate principal amount of € million bearing % annual interest and due June 2031 . |
(9) |
In May 2025, Teva issued senior notes in an aggregate principal amount of $ million bearing % annual interest and due December 2032 . |
(10) |
In June 2025, Teva consummated a cash tender offer and extinguished $ million aggregate principal amount of its % senior notes due 2026; $ million aggregate principal amount of its % senior notes due 2027; $ million aggregate principal amount of its % senior notes due in 2029; and $ million aggregate principal amount of its % senior notes due in 2029. The extinguishment resulted in a loss of $ million which was recorded under financial expenses, net. |
(11) |
Debt issuance costs as of December 31, 2025 include $ million in connection with the issuance of the senior notes in May 2025, partially offset by $ million acceleration of issuance costs related to the cash tender offer. |
(12) |
In July 2025, Teva repaid $ million of the % senior notes due 2025 at maturity. |
* |
Interest rate adjustments and a potential one-time premium payment related to the sustainability-linked bonds are treated as bifurcated embedded derivatives. See note 10c. |
a. |
Foreign exchange risk management: |
b. |
Interest risk management: |
c. |
Bifurcated embedded derivatives: |
d. |
Derivative instrument outstanding: |
Fair value |
||||||||||||||||
Designated as hedging instruments |
Not designated as hedging instruments |
|||||||||||||||
December 31, 2025 |
December 31, 2024 |
December 31, 2025 |
December 31, 2024 |
|||||||||||||
| Reported under |
(U.S. $ in millions) |
(U.S. $ in millions) |
||||||||||||||
| Asset derivatives: |
||||||||||||||||
| Other current assets: |
||||||||||||||||
| Option and forward contracts |
$ | $ | $ | $ | ||||||||||||
| Liability derivatives: |
||||||||||||||||
| Other current liabilities: |
||||||||||||||||
| Option and forward contracts |
$ | $ | $ | ( |
) | $ | ( |
) | ||||||||
| Other non-current liabilities: |
||||||||||||||||
| Cross-currency interest rate swap-cash flow hedge (1) |
( |
) | ||||||||||||||
| Reported under |
Financial expenses, net |
Other comprehensive income (loss) |
||||||||||||||||||||||
Year ended December 31, |
Year ended December 31, |
|||||||||||||||||||||||
2025 |
2024 |
2023 |
2025 |
2024 |
2023 |
|||||||||||||||||||
(U.S. $ in millions) |
||||||||||||||||||||||||
| Line items in which effects of hedges are recorded |
$ | $ | $ | $ | $ | ( |
) | $ | ||||||||||||||||
| Cross-currency swaps-cash flow hedge (1) |
( |
) | ( |
) | ( |
) | ||||||||||||||||||
| Reported under |
Financial expenses, net |
Net revenues |
||||||||||||||||||||||
Year ended December 31, |
Year ended December 31, |
|||||||||||||||||||||||
2025 |
2024 |
2023 |
2025 |
2024 |
2023 |
|||||||||||||||||||
(U.S. $ in millions) |
||||||||||||||||||||||||
| Line items in which effects of hedges are recorded |
$ | $ | $ | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||||||||||
| Option and forward contracts (2) |
( |
) | ( |
) | ( |
) | ||||||||||||||||||
| Option and forward contracts economic hedge (3) |
( |
) | ||||||||||||||||||||||
| (1) | On May 2025, Teva entered into a $ principal and interest payments associated with the USD denominated notes. The cross-currency swaps synthetically convert part of the USD debt into CHF, aligning debt servicing costs with Teva’s inflows and reducing economic volatility. These swaps have been designated as cash flow hedges and the gain or loss on these swaps will be reported as a component of other comprehensive income and reclassified into earnings in each period during which the swaps affect earnings in the same line item associated with the USD denominated bonds. |
| (2) | Teva uses foreign exchange contracts (mainly option and forward contracts) to hedge balance sheet items from currency exposure. These foreign exchange contracts are not designated as hedging instruments for accounting purposes. In connection with these foreign exchange contracts, Teva recognizes gains or losses that offset the revaluation of the balance sheet items also recorded under financial expenses, net. |
| (3) | Teva entered into option and forward contracts designed to limit the exposure of foreign exchange fluctuations on projected revenues and expenses recorded in euro, Swiss franc, British pound, Russian ruble, Canadian dollar, Polish złoty, new Israeli shekel, Indian rupee and some other currencies to protect its projected operating results for 2025 and 2026. These derivative instruments do not meet the criteria for hedge accounting, however, they are accounted for as an economic hedge. These derivative instruments, which may include hedging transactions of future projected revenues and expenses, are recognized on the balance sheet at their fair value on a quarterly basis, while the foreign exchange impact on the underlying revenues and expenses may occur in subsequent quarters. Changes in the fair value of the derivative instruments are recognized in the same line item in the statements of income as the underlying exposure being hedged. Cash flows associated with these derivatives are reflected as cash flows from operating activities in the consolidated statements of cash flows. |
e. |
Amortizations due to terminated derivative instruments: |
f. |
Securitization: |
As of and for the year ended December 31, |
||||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
||||||||
| Sold receivables at the beginning of the year |
$ | $ | ||||||
| Proceeds from sale of receivables |
||||||||
| Cash collections (remitted to the owner of the receivables) |
( |
) | ( |
) | ||||
| Effect of currency exchange rate changes |
( |
) | ||||||
| |
|
|
|
|||||
| Sold receivables at the end of the year |
$ | $ | ||||||
| |
|
|
|
|||||
g. |
Supplier Finance Program Obligation |
As of and for the year ended December 31, |
||||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
||||||||
| Confirmed obligations outstanding at the beginning of the year |
$ | |||||||
| Invoices confirmed during the year |
||||||||
| Confirmed invoices paid during the year |
( |
) | ( |
) | ||||
| |
|
|
|
|||||
| Confirmed obligations outstanding at the end of the year |
$ | |||||||
| |
|
|
|
|||||
a. |
Commitments: |
b. |
Contingencies |
a. |
Income (loss) before income taxes: |
Year ended December 31, |
||||||||||||
2025 |
2024 |
2023 |
||||||||||
(U.S. $ in millions) |
||||||||||||
Israel (domestic) |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||
Outside Israel (foreign) |
( |
) | ||||||||||
| $ | $ | ( |
) | $ | ( |
) | ||||||
b. |
Income taxes: |
Year ended December 31, |
||||||||||||
2025 |
2024 |
2023 |
||||||||||
(U.S. $ in millions) |
||||||||||||
Israel (domestic) |
$ | $ | $ | ( |
) | |||||||
Outside Israel (foreign) |
( |
) | ( |
) | ||||||||
| $ | ( |
) | $ | $ | ( |
) | ||||||
Current |
||||||||||||
Israel (domestic) |
$ | $ | $ | |||||||||
Outside Israel (foreign) |
||||||||||||
Deferred |
||||||||||||
Israel (domestic) |
( |
) | ||||||||||
Outside Israel (foreign) |
( |
) | ( |
) | ||||||||
| $ | ( |
) | $ | $ | ( |
) | ||||||
Year ended December 31, |
||||||||
2025 |
||||||||
(U.S. $ in millions) |
Percentage |
|||||||
Israel statutory tax rate for income taxes |
$ | % | ||||||
Foreign tax effects |
||||||||
Canada |
||||||||
Change in valuation allowance |
% | |||||||
Other |
( |
) | ( |
%) | ||||
Germany |
||||||||
Statutory tax rate difference |
% | |||||||
State and local income taxes* |
( |
) | ( |
%) | ||||
Other |
( |
) | ( |
%) | ||||
Ireland |
||||||||
Change in valuation allowance |
% | |||||||
Other |
( |
) | ( |
%) | ||||
Malta |
||||||||
Statutory tax rate difference |
% | |||||||
Reduced rate due to imputation system |
( |
) | ( |
%) | ||||
Other |
% | |||||||
Mexico |
% | |||||||
Netherlands |
||||||||
Non-deductible interest |
% | |||||||
Change in valuation allowance |
% | |||||||
Other |
( |
) | ( |
%) | ||||
Switzerland |
||||||||
Statutory tax rate difference |
( |
) | ( |
%) | ||||
Exchange rate movements |
( |
) | ( |
%) | ||||
Change in valuation allowance |
( |
) | ( |
%) | ||||
Other |
% | |||||||
United Kingdom |
% | |||||||
United States |
||||||||
Change in valuation allowance |
( |
) | ( |
%) | ||||
R&D tax credit |
( |
) | ( |
%) | ||||
Base Erosion and Anti-Abuse Tax (BEAT) |
% | |||||||
Non-deductible items |
% | |||||||
Other |
( |
) | ( |
%) | ||||
Other countries |
% | |||||||
Changes in unrecognized tax benefits |
( |
) | ( |
%) | ||||
Changes in valuation allowances |
% | |||||||
Indexation of income tax payable to tax authorities |
% | |||||||
Other adjustments |
% | |||||||
Total Effective Tax Rate |
$ | ( |
) | ( |
%) | |||
* |
State taxes in Ulm in 2025 made up the majority (greater than 50%) of the tax effect in this category. |
Year ended December 31, |
||||||||
2024 |
2023 |
|||||||
(U.S. $ in millions) |
||||||||
| Income (loss) before income taxes |
$ | ( |
) | $ | ( |
) | ||
| Statutory tax rate in Israel |
% | % | ||||||
| |
|
|
|
|||||
| Theoretical provision for income taxes |
$ | ( |
) | $ | ( |
) | ||
| Increase (decrease) in the provision for income taxes due to: |
||||||||
| Tax benefits arising from net deferred taxes, resulting from intellectual property related integration plans, including carryforward losses |
( |
) | ( |
) | ||||
| The Parent Company and its Israeli subsidiaries - Settlement with the Israeli tax authorities |
— | |||||||
| Increase (decrease) in other uncertain tax positions - net |
— | |||||||
| Tax benefits arising from reduced tax rates under benefit programs |
— | |||||||
| Mainly nondeductible items and prior year tax |
||||||||
| Non-Israeli subsidiaries |
||||||||
| Impairments that did not have a corresponding tax effect, non-deductible interest and other items |
||||||||
| Adjustments to valuation allowances on deferred tax assets (*) |
( |
) | — | |||||
| Increase (decrease) in other uncertain tax positions - net |
( |
) | ||||||
| |
|
|
|
|||||
| Effective consolidated income taxes |
$ | $ | ( |
) | ||||
| |
|
|
|
|||||
* |
Mainly related to deduction of interest expenses in the United States. |
c. |
Deferred income taxes: |
December 31, |
||||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
||||||||
| Deferred tax assets (liabilities), net: |
||||||||
| Inventory related |
$ |
$ |
||||||
| Sales reserves and allowances |
||||||||
| Provision for legal settlements |
||||||||
| Intangible assets |
( |
) |
||||||
| Carryforward losses and deductions and credits (*) |
||||||||
| Property, plant and equipment |
( |
) |
( |
) | ||||
| Deferred interest |
||||||||
| Provisions for employee related obligations |
||||||||
| Other |
||||||||
| |
|
|
|
|||||
| Valuation allowance—in respect of carryforward losses and deductions that may not be utilized |
( |
) |
( |
) | ||||
| |
|
|
|
|||||
$ |
$ |
|||||||
| |
|
|
|
|||||
(*) |
The amounts are shown after reduction for unrecognized tax benefits of $ million and $ million as of December 31, 2025 and 2024, respectively. |
December 31, |
||||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
||||||||
| Long-term assets—deferred income taxes |
||||||||
| Long-term liabilities—deferred income taxes |
( |
) | ( |
) | ||||
| |
|
|
|
|||||
| $ | $ | |||||||
| |
|
|
|
|||||
d. |
Uncertain tax positions: |
Year ended December 31, |
||||||||||||
2025 |
2024 |
2023 |
||||||||||
(U.S. $ in millions) |
||||||||||||
| Balance at the beginning of the year |
$ | $ | $ | |||||||||
| Increase (decrease) related to prior year tax positions, net |
( |
) | ||||||||||
| Increase related to current year tax positions |
||||||||||||
| Decrease related to settlements with tax authorities and lapse of applicable statutes of limitations |
( |
) | ( |
) | ( |
) | ||||||
| Other |
||||||||||||
| |
|
|
|
|
|
|||||||
| Balance at the end of the year |
$ | $ | $ | |||||||||
| |
|
|
|
|
|
|||||||
e. |
Cash Income Taxes Paid (net of refunds): |
Year ended December 31, |
||||
2025 |
||||
(U.S. $ in millions) |
||||
| Israel |
$ | |||
| Foreign |
||||
| Croatia |
||||
| Poland |
||||
| Spain |
||||
| United Kingdom |
||||
| Other |
||||
| |
|
|||
| $ | ||||
| |
|
|||
f. |
Tax assessments: |
g. |
Basis of taxation: |
| 1. | Investment of at least |
| 2. | One of the following: |
| a. | At least |
| b. | A venture capital investment approximately equivalent to at least $ |
| c. | Growth in sales or workforce by an average of |
a. |
Ordinary shares and ADSs |
b. |
Stock-based compensation plans |
Year ended December 31, |
||||||||||||||||||||||||
2025 |
2024 |
2023 |
||||||||||||||||||||||
Number (in thousands) |
Weighted average exercise price |
Number (in thousands) |
Weighted average exercise price |
Number (in thousands) |
Weighted average exercise price |
|||||||||||||||||||
| Balance outstanding at beginning of year |
$ | $ | $ | |||||||||||||||||||||
| Changes during the year: |
||||||||||||||||||||||||
| Exercised |
( |
) | ( |
) | ||||||||||||||||||||
| Forfeited |
( |
) | ( |
) | ( |
) | ||||||||||||||||||
| Expired |
( |
) | ( |
) | ( |
) | ||||||||||||||||||
| |
|
|
|
|
|
|||||||||||||||||||
| Balance outstanding at end of year |
||||||||||||||||||||||||
| |
|
|
|
|
|
|||||||||||||||||||
| Balance exercisable at end of year |
||||||||||||||||||||||||
| |
|
|
|
|
|
|||||||||||||||||||
| Number of ordinary shares issuable upon exercise of vested options |
||||||||||||
| Range of exercise prices |
Balance at end of period (in thousands) |
Weighted average exercise price |
Weighted average remaining life |
|||||||||
Number of shares |
$ |
Years |
||||||||||
| $ |
||||||||||||
| $ |
||||||||||||
| $ |
||||||||||||
| $ |
||||||||||||
| $ |
||||||||||||
| $ |
||||||||||||
| |
|
|||||||||||
| Total |
||||||||||||
| |
|
|||||||||||
Year ended December 31, |
||||||||||||||||||||||||
2025 |
2024 |
2023 |
||||||||||||||||||||||
Number (in thousands) |
Weighted average grant date fair value |
Number (in thousands) |
Weighted average grant date fair value |
Number (in thousands) |
Weighted average grant date fair value |
|||||||||||||||||||
| Balance outstanding at beginning of year |
$ | $ | $ | |||||||||||||||||||||
| Granted |
||||||||||||||||||||||||
| Vested |
( |
) | ( |
) | ( |
) | ||||||||||||||||||
| Forfeited |
( |
) | ( |
) | ( |
) | ||||||||||||||||||
| |
|
|
|
|
|
|||||||||||||||||||
| Balance outstanding at end of year |
||||||||||||||||||||||||
| |
|
|
|
|
|
|||||||||||||||||||
Year ended December 31, |
||||||||||||
2025 |
2024 |
2023 |
||||||||||
(U.S. $ in millions) |
||||||||||||
| RSUs and PSUs |
||||||||||||
| |
|
|
|
|
|
|||||||
| Total stock-based compensation expense |
||||||||||||
| Tax effect on stock-based compensation expense |
||||||||||||
| |
|
|
|
|
|
|||||||
| Net effect |
$ | $ | $ | |||||||||
| |
|
|
|
|
|
|||||||
c. |
Dividends |
d. |
Accumulated other comprehensive loss |
Net Unrealized Gains (Losses) |
Benefit Plans |
|||||||||||||||
Foreign currency translation adjustments |
Derivative financial instruments |
Actuarial gains (losses) and prior service (costs) credits |
Total |
|||||||||||||
(U.S. $ in millions) |
||||||||||||||||
Balance as of January 1, 2023 |
$ | ( |
) | ( |
) | ( |
) | ( |
) | |||||||
Other comprehensive income (loss) before reclassifications |
( |
) | ( |
) | ||||||||||||
Amounts reclassified to the statements of income |
— | ( |
) | |||||||||||||
Net other comprehensive income (loss) before tax |
( |
) | ||||||||||||||
Corresponding income tax |
( |
) | — | ( |
) | |||||||||||
Net other comprehensive income (loss) after tax* |
( |
) | ||||||||||||||
Balance as of December 31, 2023 |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
| Other comprehensive income (loss) before reclassifications |
( |
) | — | ( |
) | ( |
) | |||||||||
Amounts reclassified to the statements of income |
— | ( |
) | |||||||||||||
Net other comprehensive income (loss) before tax |
( |
) | ( |
) | ( |
) | ||||||||||
Corresponding income tax |
( |
) | — | ( |
) | |||||||||||
Net other comprehensive income (loss) after tax* |
( |
) | ( |
) | ( |
) | ||||||||||
Balance as of December 31, 2024 |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Other comprehensive income |
||||||||||||||||
Amounts reclassified to the statements of income |
||||||||||||||||
Release of cumulative translation adjustments** |
— | — | ||||||||||||||
Net other comprehensive income (loss) before tax |
||||||||||||||||
Corresponding income tax |
( |
) | — | ( |
) | ( |
) | |||||||||
Net other comprehensive income (loss) after tax* |
||||||||||||||||
Balance as of December 31, 2025 |
$ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
| * | Amounts do not include $ oss in 2024 and $redeemable and non-redeemable non-controlling interests. |
| ** | In connection with the sale of Teva’s business venture in Japan. |
Year ended December 31, |
||||||||||||
2025 |
2024 |
2023 |
||||||||||
(U.S. $ in millions) |
||||||||||||
-lived (1) |
$ | $ | $ | |||||||||
Contingent consideration (see note 20) |
||||||||||||
Restructuring |
||||||||||||
Other |
( |
) |
||||||||||
Total |
$ | $ | $ | |||||||||
(1) |
Including impairments related to exit and disposal activities. |
Year ended December 31, |
||||||||||||
2025 |
2024 |
2023 |
||||||||||
(U.S. $ in millions) |
||||||||||||
| Restructuring |
||||||||||||
| Employee termination |
$ | $ | $ | |||||||||
| Other |
||||||||||||
| |
|
|
|
|
|
|||||||
| Total |
$ | $ | $ | |||||||||
| |
|
|
|
|
|
|||||||
Employee termination costs |
Other |
Total |
||||||||||
(U.S. $ in millions ) |
||||||||||||
| Balance as of January 1, 2023 |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||
| |
|
|
|
|
|
|||||||
| Provision |
( |
) | ( |
) | ( |
) | ||||||
| Utilization and other* |
||||||||||||
| |
|
|
|
|
|
|||||||
| Balance as of December 31, 2023 |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||
| |
|
|
|
|
|
|||||||
| Provision |
( |
) | ( |
) | ( |
) | ||||||
| Utilization and other* |
||||||||||||
| |
|
|
|
|
|
|||||||
| Balance as of December 31, 2024 |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||
| |
|
|
|
|
|
|||||||
| Provision |
( |
) | ( |
) | ( |
) | ||||||
| Utilization and other* |
||||||||||||
| |
|
|
|
|
|
|||||||
| Balance as of December 31, 2025 |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||
| |
|
|
|
|
|
|||||||
| * | Includes adjustments for foreign currency translation. |
Year ended December 31, |
||||||||||||
2025 |
2024 |
2023 |
||||||||||
(U.S. $ in millions) |
||||||||||||
| Gain (loss) on divestitures, net of divestitures related costs |
$ | ( |
) | $ | $ | |||||||
| Gain (loss) on sale of assets |
||||||||||||
| Other, net |
( |
) | ||||||||||
| |
|
|
|
|
|
|||||||
| Total other income (loss) |
$ | ( |
) | $ | $ | |||||||
| |
|
|
|
|
|
|||||||
Year ended December, 31 |
||||||||||||
2025 |
2024 |
2023 |
||||||||||
(U.S. $ in millions) |
||||||||||||
| Interest expenses and other bank charges |
$ | $ | $ | |||||||||
| (Income) loss from investments |
( |
) | ( |
) | ( |
) | ||||||
| Foreign exchange (gains) losses, net |
||||||||||||
| Other, net (*) |
||||||||||||
| |
|
|
|
|
|
|||||||
| Total finance expense, net |
$ | $ | $ | |||||||||
| |
|
|
|
|
|
|||||||
| (*) | Amortization of issuance costs and terminated derivative instruments. |
Years ended December 31, |
||||||||||||
2025 |
2024 |
2023 |
||||||||||
(In millions, except per share amounts) |
||||||||||||
| Basic earnings (loss) attributable to Teva’s ordinary shareholders (numerator): |
||||||||||||
| Net income (loss) attributable to Teva’s ordinary shareholders |
$ | $ | ( |
) | $ | ( |
) | |||||
| |
|
|
|
|
|
|||||||
| Shares (denominator): |
||||||||||||
| Weighted average shares outstanding |
||||||||||||
| |
|
|
|
|
|
|||||||
| Basic earnings (loss) attributable to Teva’s ordinary shareholders |
$ | $ | ( |
) | $ | ( |
) | |||||
| |
|
|
|
|
|
|||||||
| Diluted earnings (loss) attributable to Teva’s ordinary shareholders (numerator): |
||||||||||||
| Net income (loss) attributable to Teva’s ordinary shareholders |
$ | $ | ( |
) | $ | ( |
) | |||||
| |
|
|
|
|
|
|||||||
| Shares (denominator): |
||||||||||||
| Weighted average shares outstanding |
||||||||||||
| Diluted effect of stock options, RSUs and PSUs |
— | — | ||||||||||
| |
|
|
|
|
|
|||||||
| Total dilutive shares outstanding |
||||||||||||
| |
|
|
|
|
|
|||||||
| Diluted earnings (loss) attributable to Teva’s ordinary shareholders |
$ | $ | ( |
) | $ | ( |
) | |||||
| |
|
|
|
|
|
|||||||
(a) |
United States segment. |
(b) |
Europe segment, which includes the European Union, the United Kingdom and certain other European countries. |
(c) |
International Markets segment, which includes all countries other than the United States and countries included in the Europe segment. |
a. |
Segment information: |
Year ended December 31, |
||||||||||||
2025 |
||||||||||||
United States |
Europe |
International Markets |
||||||||||
(U.S. $ in millions) |
||||||||||||
| Revenues |
$ | $ | $ | |||||||||
| Cost of sales |
||||||||||||
| R&D expenses |
||||||||||||
| S&M expenses |
||||||||||||
| G&A expenses |
||||||||||||
| Other |
§ | ( |
) | |||||||||
| |
|
|
|
|
|
|||||||
| Segment profit |
$ | $ | $ | |||||||||
| |
|
|
|
|
|
|||||||
§ |
Represents an amount less than $0.5 million. |
Year ended December 31, |
||||||||||||
2024 |
||||||||||||
United States |
Europe |
International Markets |
||||||||||
(U.S. $ in millions) |
||||||||||||
| Revenues |
$ | $ | $ | |||||||||
| Cost of sales |
||||||||||||
| R&D expenses |
||||||||||||
| S&M expenses |
||||||||||||
| G&A expenses |
||||||||||||
| Other |
§ | ( |
) | |||||||||
| |
|
|
|
|
|
|||||||
| Segment profit |
$ | $ | $ | |||||||||
| |
|
|
|
|
|
|||||||
§ |
Represents an amount less than $0.5 million. |
Year ended December 31, |
||||||||||||
2023 |
||||||||||||
United States |
Europe |
International Markets |
||||||||||
(U.S. $ in millions) |
||||||||||||
| Revenues |
$ | $ | $ | |||||||||
| Cost of sales |
||||||||||||
| R&D expenses |
||||||||||||
| S&M expenses |
||||||||||||
| G&A expenses |
||||||||||||
| Other loss (income) |
( |
) | ( |
) | ( |
) | ||||||
| |
|
|
|
|
|
|||||||
| Segment profit |
$ | $ | $ | |||||||||
| |
|
|
|
|
|
|||||||
Year ended December 31, |
||||||||||||
2025 |
2024 |
2023 |
||||||||||
(U.S. $ in millions) |
||||||||||||
| United States profit |
$ | $ | $ | |||||||||
| Europe profit |
||||||||||||
| International Markets profit |
||||||||||||
| |
|
|
|
|
|
|||||||
| Total reportable segments profit |
||||||||||||
| Profit (loss) of other activities |
( |
) | ||||||||||
| |
|
|
|
|
|
|||||||
| Amounts not allocated to segments: |
||||||||||||
| Amortization |
||||||||||||
| Other assets impairments, restructuring and other items |
||||||||||||
| Goodwill impairment |
— | |||||||||||
| Intangible asset impairments |
||||||||||||
| Legal settlements and loss contingencies |
||||||||||||
| Other unallocated amounts |
||||||||||||
| |
|
|
|
|
|
|||||||
| Consolidated operating income (loss) |
( |
) | ||||||||||
| |
|
|
|
|
|
|||||||
| Financial expenses, net |
||||||||||||
| |
|
|
|
|
|
|||||||
| Consolidated income (loss) before income taxes |
$ | $ | ( |
) | $ | ( |
) | |||||
| |
|
|
|
|
|
|||||||
b. |
Segment revenues by major products and activities: |
Year ended December 31, |
||||||||||||
2025 |
2024 |
2023 |
||||||||||
(U.S. $ in millions) |
||||||||||||
| Generic products (including biosimilars) |
$ | $ | $ | |||||||||
| AJOVY |
||||||||||||
| AUSTEDO |
||||||||||||
| BENDEKA and TREANDA |
||||||||||||
| COPAXONE |
||||||||||||
| UZEDY |
||||||||||||
| Anda |
||||||||||||
| Other* |
||||||||||||
| |
|
|
|
|
|
|||||||
| Total |
$ | $ | $ | |||||||||
| |
|
|
|
|
|
|||||||
| * | Other revenues in 2025 were mainly comprised of development milestone payments of $2 ). Other revenues in 2024 include the sale of certain product rights. Other revenues in 2023 were mainly comprised of a $ |
Year ended December 31, |
||||||||||||
2025 |
2024 |
2023 |
||||||||||
(U.S. $ in millions) |
||||||||||||
| Generic products (including OTC and biosimilars) |
$ | $ | $ | |||||||||
| AJOVY |
||||||||||||
| COPAXONE |
||||||||||||
| Respiratory products |
||||||||||||
| Other* |
||||||||||||
| |
|
|
|
|
|
|||||||
| Total |
$ | $ | $ | |||||||||
| |
|
|
|
|
|
|||||||
| * | Other revenues in 2025, 2024 and 2023 include the sale of certain product rights. |
Year ended December 31, |
||||||||||||
2025 |
2024 |
2023 |
||||||||||
(U.S. $ in millions) |
||||||||||||
| Generic products (including OTC and biosimilars) |
$ | $ | $ | |||||||||
| AJOVY |
||||||||||||
| AUSTEDO |
||||||||||||
| COPAXONE |
||||||||||||
| Other* |
||||||||||||
| |
|
|
|
|
|
|||||||
| Total |
$ | $ | $ | |||||||||
| |
|
|
|
|
|
|||||||
| * | Other revenues in 2025 and 2024 include the sale of certain product rights. |
c. |
Supplemental data—major customers: |
Percentage of Third Party Net Sales |
||||||||||||
2025 |
2024 |
2023 |
||||||||||
| McKesson Corporation |
% | % | % | |||||||||
| AmerisourceBergen Corporation |
% | % | % | |||||||||
d. |
Property, plant and equipment—by geographical location were as follows: |
December 31, |
||||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
||||||||
| Israel |
$ | $ | ||||||
| Germany |
||||||||
| United States |
||||||||
| Croatia |
||||||||
| Czech Republic |
||||||||
| Hungary |
||||||||
| Ireland |
||||||||
| Other |
||||||||
| |
|
|
|
|||||
| Total property, plant and equipment |
$ | $ | ||||||
| |
|
|
|
|||||
December 31, 2025 |
||||||||||||||||
Level 1 |
Level 2 |
Level 3 |
Total |
|||||||||||||
(U.S. $ in millions) |
||||||||||||||||
| Cash and cash equivalents: |
||||||||||||||||
| Money markets |
$ | — | — | $ | ||||||||||||
| Cash, deposits and other |
— | — | ||||||||||||||
| Investment in securities: |
||||||||||||||||
| Equity securities |
— | — | ||||||||||||||
| Other |
— | — | ||||||||||||||
| Derivatives: |
||||||||||||||||
| Asset derivatives: |
||||||||||||||||
| Options and forward contracts |
— | — | ||||||||||||||
| Liabilities derivatives: |
||||||||||||||||
| Options and forward contracts |
— | ( |
) | — | ( |
) | ||||||||||
| Cross currency interest rate swap |
( |
) | ( |
) | ||||||||||||
| Contingent consideration* |
— | — | ( |
) | ( |
) | ||||||||||
| |
|
|
|
|
|
|
|
|||||||||
| Total |
$ | $ | $ | ( |
) | $ | ||||||||||
| |
|
|
|
|
|
|
|
|||||||||
December 31, 2024 |
||||||||||||||||
Level 1 |
Level 2 |
Level 3 |
Total |
|||||||||||||
(U.S. $ in millions) |
||||||||||||||||
| Cash and cash equivalents: |
||||||||||||||||
| Money markets |
$ | — | — | $ | ||||||||||||
| Cash, deposits and other |
— | — | ||||||||||||||
| Investment in securities: |
||||||||||||||||
| Equity securities |
— | — | ||||||||||||||
| Other |
— | — | ||||||||||||||
| Derivatives: |
||||||||||||||||
| Asset derivatives: |
||||||||||||||||
| Options and forward contracts |
— | — | ||||||||||||||
| Liabilities derivatives: |
||||||||||||||||
| Options and forward contracts |
— | ( |
) | — | ( |
) | ||||||||||
| Contingent consideration* |
— | — | ( |
) | ( |
) | ||||||||||
| |
|
|
|
|
|
|
|
|||||||||
| Total |
$ | $ | $ | ( |
) | $ | ||||||||||
| |
|
|
|
|
|
|
|
|||||||||
| * | Contingent consideration represents liabilities recorded at fair value in connection with acquisitions. The contingent consideration liability is recorded under accrued expenses and other taxes and long term liabilities. |
December 31, 2025 |
December 31, 2024 |
|||||||
(U.S. $ in millions) |
||||||||
| Fair value at the beginning of the period |
$ | ( |
) | $ | ( |
) | ||
| Redemption of convertible bond security* |
— | ( |
) | |||||
| Adjustments to provisions for contingent consideration: |
||||||||
| Allergan transaction |
( |
) | ( |
) | ||||
| Eagle transaction |
( |
) | ( |
) | ||||
| Novetide transaction |
( |
) | ( |
) | ||||
| Settlement of contingent consideration: |
||||||||
| Allergan transaction |
||||||||
| Eagle transaction |
||||||||
| Novetide transaction |
||||||||
| |
|
|
|
|||||
| Fair value at the end of the period |
$ | ( |
) | $ | ( |
) | ||
| |
|
|
|
|||||
| * | On September 29, 2023, Teva purchased $ |
Estimated fair value* |
||||||||
December 31, |
||||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
||||||||
| Senior notes and sustainability-linked senior notes included under senior notes and loans |
$ | $ | ||||||
| Senior notes and convertible senior debentures included under short-term debt |
||||||||
| |
|
|
|
|||||
| Total |
$ | $ | ||||||
| |
|
|
|
|||||
| * | The fair value was estimated based on quoted market prices. |
a. |
Long-term employee-related obligations consisted of the following: |
December 31, |
||||||||
2025 |
2024 |
|||||||
(U.S. $ in millions) |
||||||||
| Accrued severance obligations |
$ | $ | ||||||
| Defined benefit plans |
||||||||
| |
|
|
|
|||||
| Total (*) |
$ | $ | ||||||
| |
|
|
|
|||||
| (*) | Teva’s long-term employee-related obligations are presented in the Consolidated Balance Sheet under other taxes and long-term liabilities. |
b. |
Terms of arrangements: |
Redeemable non-controlling interests |
||||
(U.S. $ in millions) |
||||
| Balance as of December 31, 2024 |
$ | |||
| |
|
|||
| Changes during the period: |
||||
| Share in comprehensive income (loss) |
||||
| Dividend payment |
( |
) | ||
| Purchase of shares from redeemable non-controlling interests |
( |
) | ||
| Other adjustments related to redeemable non-controlling interests |
||||
| |
|
|||
| Balance as of December 31, 2025 |
$ | |||
| |
|
|||
| Column A |
Column B |
Column C |
Column D |
Column E |
||||||||||||||||
Balance at beginning of period |
Charged to costs and expenses |
Charged to other accounts |
Deductions |
Balance at end of period |
||||||||||||||||
| Allowance for doubtful accounts including credit losses: |
||||||||||||||||||||
| Year ended December 31, 2025 |
$ |
$ |
$ |
( |
) |
$ |
( |
) |
||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| Year ended December 31, 2024 |
$ |
$ |
$ |
( |
) |
$ |
( |
) |
||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| Year ended December 31, 2023 |
$ |
$ |
$ |
( |
) |
$ |
( |
) |
||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| Allowance in respect of carryforward tax losses and deductions that may not be utilized: |
||||||||||||||||||||
| Year ended December 31, 2025 |
$ |
$ |
$ |
— |
$ |
( |
) |
$ |
||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| Year ended December 31, 2024 |
$ |
$ |
$ |
— |
$ |
( |
) |
$ |
||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| Year ended December 31, 2023 |
$ |
$ |
$ |
— |
$ |
( |
) |
$ |
||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
Table of Contents
Name and Title |
Date |
Expiration Date |
Maximum Shares Subject to Plan (1) |
|||||||
Matthew Shields , EVP |
||||||||||
David R. McAvoy , EVP |
||||||||||
(1) |
Certain plans include shares to be sold solely to cover tax withholding obligations. |
ITEM 14. |
PRINCIPAL ACCOUNTANT FEES AND SERVICES |
Table of Contents
PART IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
| (a) | The following financial statements are filed as part of this Annual Report on Form 10-K: |
| page | ||||
| Report of Independent Registered Public Accounting Firm |
89 | |||
| Consolidated Financial Statements: |
||||
| Balance sheets |
92 | |||
| Statements of income |
93 | |||
| Statements of comprehensive income (loss) |
94 | |||
| Statements of changes in equity |
95 | |||
| Statements of cash flows |
96 | |||
| Notes to consolidated financial statements |
98 | |||
| Financial Statement Schedule: |
||||
| Schedule II—Valuation and Qualifying Accounts |
176 | |||
Exhibits
(b) The information called for by this Item is incorporated herein by reference to the Exhibit Index in this Form 10-K.
| 3.1 | Memorandum of Association (incorporated by reference to Exhibit 3.1 to Registration Statement on Form F-1 (Reg. No. 33-15736)) (1) | |
| 3.2 | Amendment to Memorandum of Association (incorporated by reference to Exhibit 3.1 to Current Report on Form 8-K filed with the SEC on December 14, 2018) (1) | |
| 3.3 | Articles of Association (incorporated by reference to Exhibit 3.1 to Current Report on Form 8-K filed with the SEC on June 23, 2022) | |
| 4.1 | Second Amended and Restated Deposit Agreement, dated as of December 4, 2018, among Teva Pharmaceutical Industries Limited, Citibank, N.A., as depositary, and the holders from time to time of shares (incorporated by reference to Exhibit 4.1 to Current Report on Form 8-K filed with the SEC on December 4, 2018) | |
| 4.2 | Senior Indenture, dated as of January 31, 2006, by and among Teva Pharmaceutical Finance Company LLC, Teva Pharmaceutical Industries Limited and The Bank of New York, as trustee (incorporated by reference to Exhibit 4.1 to Form 6-K filed with the SEC on January 31, 2006) | |
| 4.3 | First Supplemental Senior Indenture, dated as of January 31, 2006, by and among Teva Pharmaceutical Finance Company LLC, Teva Pharmaceutical Industries Limited and The Bank of New York, as trustee, including the form of 0.25% Convertible Senior Debentures due 2026 (incorporated by reference to Exhibit 4.2 to Form 6-K filed with the SEC on January 31, 2006) | |
| 4.4 | Second Supplemental Senior Indenture, dated as of January 31, 2006, by and among Teva Pharmaceutical Finance Company LLC, Teva Pharmaceutical Industries Limited and The Bank of New York, as trustee, including the form of 6.150% Senior Notes due 2036 (incorporated by reference to Exhibit 4.3 to Form 6-K filed with the SEC on January 31, 2006) | |
| 4.5 | Third Supplemental Senior Indenture, dated as of March 16, 2010, by and among Teva Pharmaceutical Finance Company LLC, Teva Pharmaceutical Industries Limited and The Bank of New York, as trustee, relating to Teva’s 0.25% Convertible Senior Debentures due 2026 (incorporated by reference to Exhibit 4.1 to Form 6-K filed with the SEC on May 4, 2010) | |
180
Table of Contents
| 4.6 | Senior Indenture, dated as of November 10, 2011, by and among Teva Pharmaceutical Finance Company B.V., Teva Pharmaceutical Industries Limited and The Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.3 to Form 6-K filed with the SEC on November 10, 2011) | |
| 4.7 | Senior Indenture, dated as of March 31, 2015, by and among Teva Pharmaceutical Industries Limited, Teva Pharmaceutical Finance Netherlands II B.V. and The Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.1 to Form 6-K filed with the SEC on March 31, 2015) | |
| 4.8 | Supplemental Senior Indenture, dated as of March 31, 2015, by and among Teva Pharmaceutical Industries Limited, Teva Pharmaceutical Finance Netherlands II B.V., The Bank of New York Mellon, as trustee, and The Bank of New York Mellon, London branch, as principal paying agent, including the form of 1.250% Senior Notes due 2023 and the form of 1.875% Senior Notes due 2027 (incorporated by reference to Exhibit 4.2 to Form 6-K filed with the SEC on March 31, 2015) | |
| 4.9 | Second Supplemental Senior Indenture, dated as of July 25, 2016, by and among Teva Pharmaceutical Industries Limited, Teva Pharmaceutical Finance Netherlands II B.V., The Bank of New York Mellon, as trustee, and The Bank of New York Mellon, London branch, as principal paying agent, including the form of 1.125% Senior Notes due 2024 and the form of 1.625% Senior Notes due 2028 (incorporated by reference to Exhibit 4.2 to Form 6-K filed with the SEC on July 25, 2016) | |
| 4.10 | Senior Indenture, dated as of July 21, 2016, by and among Teva Pharmaceutical Finance Netherlands III B.V., Teva Pharmaceutical Industries Limited and The Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.1 to Form 6-K filed with the SEC on July 21, 2016) | |
| 4.11 | First Supplemental Senior Indenture, dated as of July 21, 2016, by and among Teva Pharmaceutical Finance Netherlands III B.V., Teva Pharmaceutical Industries Limited and The Bank of New York Mellon, as trustee, including the form of 3.150% Senior Notes due 2026 and the form of 4.100% Senior Notes due 2046 (incorporated by reference to Exhibit 4.2 to Form 6-K filed with the SEC on July 21, 2016) | |
| 4.12 | Permanent Global Certificate, dated as of July 28, 2016, and the Terms of the CHF 350,000,000 1.000 per cent Notes due 2025 (incorporated by reference to Exhibit 4.3 to Form 6-K filed with the SEC on July 28, 2016) | |
| 4.13 | Guarantee, dated as of July 28, 2016, by Teva Pharmaceutical Industries Limited (relating to the 2025 Notes) (incorporated by reference to Exhibit 4.6 to Form 6-K filed with the SEC on July 28, 2016) | |
| 4.14 | Senior Indenture, dated as of March 14, 2018, by and among Teva Pharmaceutical Finance Netherlands III B.V., Teva Pharmaceutical Industries Limited and the Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.1 to Current Report on Form 8-K filed with the SEC on March 14, 2018) | |
| 4.15 | First Supplemental Senior Indenture, dated as of March 14, 2018, by and among Teva Pharmaceutical Finance Netherlands III B.V., Teva Pharmaceutical Industries Limited and the Bank of New York Mellon, as trustee, including the form of 6.000% Senior Notes due 2024 and the form of 6.750% Senior Notes due 2028 (incorporated by reference to Exhibit 4.2 to Current Report on Form 8-K filed with the SEC on March 14, 2018) | |
| 4.16 | Senior Indenture, dated as of March 14, 2018, by and among Teva Pharmaceutical Finance Netherlands II B.V., Teva Pharmaceutical Industries Limited and the Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.5 to Current Report on Form 8-K filed with the SEC on March 14, 2018) | |
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| 4.17 | First Supplemental Senior Indenture, dated as of March 14, 2018, by and among Teva Pharmaceutical Finance Netherlands II B.V., Teva Pharmaceutical Industries Limited and the Bank of New York Mellon, as trustee, including the form of 4.500% Senior Notes due 2025 (incorporated by reference to Exhibit 4.6 to Current Report on Form 8-K filed with the SEC on March 14, 2018) | |
| 4.18 | Second Supplemental Senior Indenture, dated as of November 25, 2019, among Teva Pharmaceutical Finance Netherlands II B.V., Teva Pharmaceutical Industries Limited, The Bank of New York Mellon, as trustee, and The Bank of New York Mellon, London Branch, as paying agent, including the form of the 6.000% Senior Notes due 2025 (incorporated by reference to Exhibit 4.2 to Current Report on Form 8-K filed with the SEC on November 25, 2019) | |
| 4.19 | Second Supplemental Senior Indenture, dated as of November 25, 2019, among Teva Pharmaceutical Finance Netherlands III B.V., Teva Pharmaceutical Industries Limited and The Bank of New York Mellon, as trustee, including the form of the 7.125% Senior Notes due 2025 (incorporated by reference to Exhibit 4.6 to Current Report on Form 8-K filed with the SEC on November 25, 2019) | |
| 4.20 | Third Supplemental Senior Indenture, dated as of November 9, 2021, among Teva Pharmaceutical Finance Netherlands II B.V., Teva Pharmaceutical Industries Limited, The Bank of New York Mellon, as trustee, and The Bank of New York Mellon, London Branch, as paying agent, including the form of 3.750% Sustainability-Linked Senior Notes due 2027 and the form of 4.375% Sustainability-Linked Senior Notes due 2030 (incorporated by reference to Exhibit 4.2 to Current Report on Form 8-K filed with the SEC on November 10, 2021) | |
| 4.21 | Third Supplemental Senior Indenture, dated as of November 9, 2021, among Teva Pharmaceutical Finance Netherlands III B.V., Teva Pharmaceutical Industries Limited and The Bank of New York Mellon, as trustee, including the form of 4.750% Sustainability-Linked Senior Notes due 2027 and the form of 5.125% Sustainability-Linked Senior Notes due 2029 (incorporated by reference to Exhibit 4.6 to Current Report on Form 8-K filed with the SEC on November 10, 2021) | |
| 4.22 | Description of Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934 (incorporated by reference to Exhibit 4.33 to Annual Report on Form 10-K filed with the SEC on February 21, 2020) | |
| 4.23 | Fourth Supplemental Senior Indenture, dated as of March 9, 2023, among Teva Pharmaceutical Finance Netherlands II B.V., Teva Pharmaceutical Industries Limited, The Bank of New York Mellon, as trustee, and The Bank of New York Mellon, London Branch, as paying agent, including the form of the 7.375% Sustainability-Linked Senior Notes due 2029 and the form of the 7.875% Sustainability-Linked Senior Notes due 2031 (incorporated by reference to Exhibit 4.2 to Current Report on Form 8-K filed with the SEC on March 9, 2023) | |
| 4.24 | Fourth Supplemental Senior Indenture, dated as of March 9, 2023, among Teva Pharmaceutical Finance Netherlands III B.V., Teva Pharmaceutical Industries Limited and The Bank of New York Mellon, as trustee, including the form of the 7.875% Sustainability-Linked Senior Notes due 2029 and the form of the 8.125% Sustainability-Linked Senior Notes due 2031 (incorporated by reference to Exhibit 4.6 to Current Report on Form 8-K filed with the SEC on March 9, 2023) | |
| 4.25 | Fifth Supplemental Senior Indenture, dated as of May 28, 2025, among Teva Pharmaceutical Finance Netherlands II B.V., Teva Pharmaceutical Industries Limited, The Bank of New York Mellon, as trustee, and The Bank of New York Mellon, London Branch, as paying agent (incorporated by reference to Exhibit 4.2 to Current Report on Form 8-K filed with the SEC on May 28, 2025) | |
| 4.26 | Form of 2031 Euro Notes (included in Exhibit 4.25) (incorporated by reference to Exhibit 4.3 to Current Report on Form 8-K filed with the SEC on May 28, 2025) | |
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| 4.27 | Fifth Supplemental Senior Indenture, dated as of May 28, 2025, among Teva Pharmaceutical Finance Netherlands III B.V., Teva Pharmaceutical Industries Limited and The Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.5 to Current Report on Form 8-K filed with the SEC on May 28, 2025) | |
| 4.28 | Form of 2032 USD Notes (included in Exhibit 4.27) (incorporated by reference to Exhibit 4.6 to Current Report on Form 8-K filed with the SEC on May 28, 2025) | |
| 4.29 | Senior Indenture, dated as of May 28, 2025, among Teva Pharmaceutical Finance Netherlands IV B.V., Teva Pharmaceutical Industries Limited and The Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.7 to Current Report on Form 8-K filed with the SEC on May 28, 2025) | |
| 4.30 | First Supplemental Senior Indenture, dated as of May 28, 2025, among Teva Pharmaceutical Finance Netherlands IV B.V., Teva Pharmaceutical Industries Limited and The Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.8 to Current Report on Form 8-K filed with the SEC on May 28, 2025) | |
| 4.31 | Form of 2030 USD Notes (included in Exhibit 4.31) (incorporated by reference to Exhibit 4.9 to Current Report on Form 8-K filed with the SEC on May 28, 2025) | |
| 4.32 | Other long-term debt instruments: The registrant hereby undertakes to provide the Securities and Exchange Commission with copies upon request. | |
| 10.1 | Senior Unsecured Sustainability-Linked Revolving Credit Agreement, dated as of April 29, 2022, by and among Teva Pharmaceutical Industries Limited, Teva Pharmaceuticals USA, Inc., Teva Pharmaceutical Finance Netherlands II B.V. and Teva Pharmaceutical Finance Netherlands III B.V., as borrowers, Bank of America, N.A., as administrative agent, Bank of America Europe Designated Activity Company, as sustainability coordinator and documentation agent, and the lenders party thereto (incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q filed with the SEC on May 3, 2022) | |
| 10.2 | Amendment to Senior Unsecured Sustainability-Linked Revolving Credit Agreement, dated as of February 6, 2023, by and among Teva Pharmaceutical Industries Limited, Teva Pharmaceutical Industries Limited, Teva Pharmaceuticals USA, Inc., Teva Pharmaceutical Finance Netherlands II B.V. and Teva Pharmaceutical Finance Netherlands III B.V., as borrowers, Bank of America, N.A. and the certain other lenders party thereto (incorporated by reference to Exhibit 10.3 to Annual Report on Form 10-K filed with the SEC on February 10, 2023) | |
| 10.3 | Second Amendment to Senior Unsecured Sustainability-Linked Revolving Credit Agreement, dated May 3, 2024, by and among Teva Pharmaceutical Industries Limited, Teva Pharmaceuticals USA, Inc., Teva Pharmaceutical Finance Netherlands II B.V., Teva Pharmaceutical Finance Netherlands III B.V., and Bank of America, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q filed with the SEC on May 8, 2024) | |
| 10.4 | Third Amendment to the Senior Unsecured Sustainability-Linked Revolving Credit Agreement, dated as of December 10, 2025, between, amongst others, Teva Pharmaceutical Industries Limited, the lenders party thereto and Bank of America, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed with the SEC on December 11, 2025). | |
| 10.5 | Global Opioids Settlement Agreement, effective on August 7, 2023, between Teva Pharmaceutical Industries Ltd. and the states, subdivisions and special districts named therein (incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q filed with the SEC on August 2, 2023) | |
| 10.6 | English summary of Tax Settlement Agreement, dated June 23, 2024, between Teva Pharmaceutical Industries Limited and the Israeli Tax Authorities (incorporated by reference to Exhibit 10.2 to Quarterly Report on Form 10-Q filed with the SEC on July 31, 2024) | |
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| 10.7 | Deferred Prosecution Agreement with the U.S. Department of Justice, dated August 21, 2023 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed with the SEC on August 24, 2023) | |
| 10.8 † | Employment Agreement, dated November 21, 2022, between Teva Pharmaceutical Industries Limited and Richard D. Francis (incorporated by reference to Exhibit 10.6 to Annual Report on Form 10-K filed with the SEC on February 10, 2023) | |
| 10.9 † | Amendment No. 1, dated as of June 5, 2025, to the Employment Agreement between Teva Pharmaceutical Industries Limited and Richard D. Francis (incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q filed with the SEC on July 30, 2025) | |
| 10.10 † | Employment Agreement, dated as of June 14, 2022, between Teva Pharmaceuticals USA, Inc., and Eric A. Hughes (incorporated by reference to Exhibit 10.8 to Annual Report on Form 10-K filed with the SEC on February 5, 2025) | |
| 10.11 † | Employment Agreement, dated as of November 6, 2019, between Teva Pharmaceutical Industries Limited and Eli Kalif (incorporated by reference to Exhibit 10.13 to Annual Report on Form 10-K filed with the SEC on February 21, 2020) | |
| 10.12 † | Amendment to Employment Agreement between Teva Pharmaceutical Industries Limited and Eli Kalif, dated as of February 6, 2020 (incorporated by reference to Exhibit 10.32 to Annual Report on Form 10-K filed with the SEC on February 21, 2020) | |
| 10.13 † | Teva Pharmaceutical Industries Limited 2015 Long-Term Equity-Based Incentive Plan (incorporated by reference to Exhibit A to Proxy Statement filed with the SEC on June 8, 2017) | |
| 10.14 † | Teva Pharmaceuticals USA, Inc. Supplemental Deferred Compensation Plan (incorporated by reference to Exhibit 10.49 to Annual Report on Form 10-K filed with the SEC on February 12, 2018) | |
| 10.15 | Form of Indemnification and Release Agreement (incorporated by reference to Exhibit 10.51 to Annual Report on Form 10-K filed with the SEC on February 12, 2018) | |
| 10.16 † | Form of Director Award Agreement (incorporated by reference to Exhibit 10.52 to Annual Report on Form 10-K filed with the SEC on February 12, 2018) | |
| 10.17 † | Teva Pharmaceutical Industries Limited 2020 Long-Term Equity-Based Incentive Plan (incorporated by reference to Exhibit Appendix A to our Definitive Proxy Statement filed with the SEC on April 22, 2020) | |
| 10.18 † | Form Bonus Letter Agreement (incorporated by reference to Exhibit 10.64 to Annual Report on Form 10-K filed with the SEC on February 12, 2018) | |
| 10.19 † | Form Award Agreement under Teva’s 2020 Long-Term Equity-Based Incentive Plan (incorporated by reference to Exhibit 10.2 to Quarterly Report on Form 10-Q filed with the SEC on November 5, 2020) | |
| 10.20 † | Form Award Agreement (RSUs and PSUs) under the Teva Pharmaceutical Industries Limited 2015 Long-Term Equity-Based Incentive Plan (incorporated by reference to Exhibit 10.31 to Annual Report on Form 10-K filed with the SEC on February 21, 2020) | |
| 10.21 † | Teva Pharmaceutical Industries Limited Israeli Subplan of Teva’s 2020 Long-Term Equity-Based Incentive Plan (incorporated by reference to Exhibit 10.3 to Quarterly Report on Form 10-Q filed with the SEC on November 5, 2020) | |
| 10.22 † | Employment Agreement, dated as of September 19, 2023, between Teva Pharmaceuticals USA, Inc., and Christine Fox (incorporated by reference to Exhibit 10.20 to Annual Report on Form 10-K filed with the SEC on February 5, 2025) | |
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| 10.23 † | Employment Agreement, dated as of February 17, 2025, between Teva Pharmaceuticals USA, Inc., and Evan Lippman* | |
| 10.24 † | Form Award Agreement (RSUs and PSUs) under the Teva Pharmaceutical Industries Limited 2020 Long-Term Equity-Based Incentive (incorporated by reference to Exhibit 10.23 to Annual Report on Form 10-K filed with the SEC on February 5, 2025) | |
| 18 | Kesselman & Kesselman Preferability Letter dated August 5, 2020 (incorporated by reference to Exhibit 18 to Quarterly Report on Form 10-Q filed with the SEC on August 5, 2020) | |
| 19 | Teva Insider Trading Policy and Procedure and Teva Addendum to Insider Trading Policy (incorporated by reference to Exhibit 19 to Annual Report on Form 10-K filed with the SEC on February 5, 2025) | |
| 21 | Subsidiaries of the Registrant * | |
| 23 | Consent of Kesselman & Kesselman, independent registered public accounting firm * | |
| 31.1 | Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 * | |
| 31.2 | Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 * | |
| 32 | Certification of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 * | |
| 97 | Policy Relating to Recovery of Erroneously Awarded Compensation (incorporated by reference to Exhibit 97 to Annual Report on Form 10-K filed with the SEC on February 12, 2024) | |
| 101.INS | Interactive Data File – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the inline XBRL document | |
| 101.SCH | Inline XBRL Taxonomy Extension Schema | |
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | |
| * | Filed herewith. |
| † | Management contract or compensatory plan. |
| (1) | English translation or summary from Hebrew original, which is the official version |
ITEM 16. FORM 10-K SUMMARY
None.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| TEVA PHARMACEUTICAL INDUSTRIES LIMITED | ||
| By: | /s/ Richard D. Francis | |
| Name: | Richard D. Francis | |
| Title: | President and Chief Executive Officer | |
| Date: | February 3, 2026 | |
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENT, that each of the undersigned directors and/or officers of Teva Pharmaceutical Industries Limited, a corporation organized under the laws of Israel, hereby constitutes and appoints Richard D. Francis, Eli Kalif, David R. McAvoy and Amir Weiss, and each of them, his or her true and lawful attorneys-in-fact and agents, with full power of substitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign, execute and deliver with the U.S. Securities and Exchange Commission any and all amendments to this Annual Report on Form 10-K, with all exhibits thereto, and other documents in connection therewith, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming that all said attorneys-in-fact and agents, or any of them or their or his or her substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of 1934, this annual report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| Name |
Title |
Date | ||||
| By: | /s/ Dr. Sol J. Barer Dr. Sol J. Barer |
Chairman of the Board of Directors | February 3, 2026 | |||
| By: | /s/ Richard D. Francis Richard D. Francis |
President and Chief Executive Officer and Director | February 3, 2026 | |||
| By: | /s/ Eli Kalif Eli Kalif |
Executive Vice President, Chief Financial Officer (Principal Financial Officer) |
February 3, 2026 | |||
| By: | /s/ Amir Weiss Amir Weiss |
Senior Vice President, Chief Accounting Officer (Principal Accounting Officer) |
February 3, 2026 | |||
| By: | /s/ Rosemary A. Crane Rosemary A. Crane |
Director | February 3, 2026 | |||
| By: | /s/ Amir Elstein Amir Elstein |
Director | February 3, 2026 | |||
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| Name |
Title |
Date | ||||
| By: | /s/ Chen Lichtenstein Chen Lichtenstein |
Director | February 3, 2026 | |||
| By: | /s/ Gerald M. Lieberman Gerald M. Lieberman |
Director | February 3, 2026 | |||
| By: | /s/ Roberto A. Mignone Roberto A. Mignone |
Director | February 3, 2026 | |||
| By: |
/s/ Dr. Perry D. Nisen Dr. Perry D. Nisen |
Director |
February 3, 2026 | |||
| By: | /s/ Prof. Ronit Satchi-Fainaro Prof. Ronit Satchi-Fainaro |
Director | February 3, 2026 | |||
| By: | /s/ Prof. Varda Shalev Prof. Varda Shalev |
Director | February 3, 2026 | |||
| By: | /s/ Janet S. Vergis Janet S. Vergis |
Director | February 3, 2026 | |||
| By: | /s/ Dr. Tal Zaks Dr. Tal Zaks |
Director | February 3, 2026 | |||
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FAQ
What are the main business segments in Teva (TEVA)’s 2025 10-K?
What is Teva (TEVA)’s Pivot to Growth strategy described in the 2025 10-K?
How does Teva (TEVA)’s 2025 10-K describe its biosimilars portfolio and partnerships?
What impact does the Inflation Reduction Act have on Teva (TEVA) in the 2025 10-K?
What does Teva (TEVA)’s 2025 10-K say about its planned API business divestiture?
How many employees does Teva (TEVA) report in its 2025 10-K and where are they located?
What key innovative CNS products are highlighted in Teva (TEVA)’s 2025 10-K?
