Another of Teva’s businesses is potentially up for grabs—and this time, it’s oncology.
The Israeli pharma is "exploring various options for the future structure of its oncology business, including possible divestiture," a Teva spokeswoman confirmed Wednesday. Teva's cancer meds generated $1.14 billion in 2016 revenue.
For Teva, jettisoning the cancer lineup—which includes meds Treanda and Bendeka, both of which saw sales suffer last year on competition, the generics giant said in a February regulatory filing—would help it pay down the massive debt pile it built through M&A. Much of that debt came from a $40-billion-plus buy of Allergan’s generics business that investors weren’t that keen on.
And recently, Teva’s directors haven’t much cared for the way CFO Eyal Desheh has managed the debt burden, Israeli newspaper Calcalist noted Tuesday. On Wednesday, Teva announced that the longtime leader would exit "during the coming months," a move that follows former CEO Erez Vigodman’s February departure.
Despite Teva’s struggles, though, its interim leaders have insisted they’ll do everything they can to right the ship—including starting up a review of the company’s businesses. “We will leave no stone unturned,” temporary chief exec Yitzhak Peterburg told investors on a recent conference call, adding that “we are here to fix what is not working."
"Teva is looking at every opportunity to focus our business, streamline operations, processes and structure," Teva's spokeswoman added.
The company has reportedly already tagged its women’s health division for a possible divestment, Bloomberg reported earlier this month; selling that piece of the pie could drum up about $2 billion.
Some industry watchers don’t necessarily think plowing ahead with strategic changes is wise before a new CEO takes the helm, though.
“What does this say about how much strategic input a new CEO will have? More to the point, how is this going to help recruit a top global executive?” RBC Capital Markets analyst Randall Stanicky wrote to investors in February. “To us this is a concern that Teva’s ‘search’ will ultimately revert to a local executive who is not a known leader in global pharma.”
Meanwhile, despite the cancer meds’ waning sales—they declined by 5% between 2015 and 2016 on the Treanda/Bendeka hardships—Teva may well find eager buyers in the pharma space. Drugmakers have jumped recently to nab cancer assets, and they’ve paid up, too; for proof, just revisit the Medivation melee, from which Pfizer ultimately emerged victorious after offering up $14 billion.
Editor's note: This story has been updated to include comments from a Teva spokeswoman.