Thanks for the advice, but no thanks. That's what Teva told Israeli officials Tuesday after Prime Minister Benjamin Netanyahu encouraged the debt-laden drugmaker to keep open its manufacturing facility in Jerusalem in the wake of last week’s announcement of stunning cuts worldwide.
In a meeting at the prime minister's office in Jerusalem, Teva CEO Kare Schultz continued to commit to keeping Teva’s headquarters in Israel but said that if the company doesn’t take drastic steps to improve its financial condition it could be the target of a takeover, CNBC reported.
The company plans to trim its global workforce by more than a quarter, 14,000 jobs, and shutter or sell a number of offices and plants. Thousands of those layoffs are targeted in Israel.
About 320 workers are expected to lose their jobs at the Jerusalem plant in 2018, with another 500 to be let go in 2019 when the facility closes. Netanyahu had proposed shuttering plants in Ireland instead, where Teva isn't a "symbol" as it is in Israel, Globes reported Tuesday.
"Unfortunately, Teva is unable to consent to the request of the prime minister and ministers and avoid the closure of the plant in Jerusalem and the company will continue in the phased closure of the plant by the end of 2019," Schultz told CNBC, following a meeting with Netanyahu and other ministers.
Protests in Israel over the Teva cuts began Sunday and disrupted activity at most of the company’s sites in Israel, the news organization said.
Teva has been dogged by $35 billion in debt it assumed as part of its acquisition of Allergan’s Actavis generic drug business for $40.5 billion. The timing of that deal proved disastrous: It came as U.S. prices for generic drugs slid and competition to Teva's blockbuster multiple sclerosis drug Copaxone stepped up.
Following the meeting Tuesday, Netanyahu said Schultz had proposed working with the government to train workers and find other employment for most of those at the Jerusalem site.