Teva has long maintained its innocence in the face of a far-reaching price-fixing indictment by the U.S. Department of Justice (DOJ). Now, the company is earmarking a sizable chunk of cash in an attempt to put the charges to bed.
During 2023’s second quarter, Teva said it had chalked up legal settlements and loss contingencies expenses of $462 million, which notably included a $200 million provision tied to the DOJ’s criminal price-fixing case. Teva has set aside the money based on “advanced settlement discussions with the DOJ,” the company’s chief financial officer, Eli Kalif, told investors on a conference call Wednesday.
Teva confirmed via email that it’s “in advanced discussions with the DOJ to settle this case.”
A Teva spokesperson added that the company will “vigorously defend” itself at trial if needed, noting the company’s day in court has been set for May 2024. Teva declined to comment further on the ongoing litigation.
When the indictment landed in August 2020, Teva marked the seventh drugmaker to be charged in the alleged price-fixing scheme. The indictment came after Teva had snubbed its nose at the government’s settlement offers.
The DOJ indicted Teva on three counts of criminal conspiracy and acting as a ringleader for a group of drugmakers that had previously pleaded guilty to their own price-fixing charges and gone on to cooperate with prosecutors.
Companies like Taro Pharma and Novartis were among those who’d already settled, anteing up $419 million and $195 million, respectively—and agreeing to turn state’s witness—to defer criminal prosecution.
Teva, for its part, immediately denied its involvement in the alleged price-fixing ring, referencing a four-year internal investigation that uncovered no wrongdoing on the company’s part.
Teva has long been dogged by a slew of lawsuits. In turn, the company has been inking settlements in recent years in an effort to focus on its bread-and-butter businesses.
When Teva announced a $4.25 billion nationwide opioid settlement last summer, the company set its sights on 2027—the year by which it now expects to return to mid- to single-digit revenue growth.
Meanwhile, under new CEO Richard Francis, the company has rolled out a new “Pivot to Growth” strategy. Built on four pillars, the tactic will see the company leverage its commercial portfolio and biosimilars, its “innovative” pipeline and its arsenal of generics as well as “focused capital allocation.”
On the dealmaking front, Teva last week hired BeiGene veteran Angus Grant, Ph.D., as its executive vice president of business development.
News of Teva’s potential settlement with the DOJ came as the company reported $3.9 billion in revenues for the second quarter. That’s up 4% from the sum Teva generated for the same period in 2022.