Teva's new CEO Richard Francis lays out his 'pivot to growth' strategy

On top of the generics world in 2010, Teva’s then-CEO Schlomo Yanai predicted a revenue boom to $31 billion in 2015. But his five-year plan, dubbed “Everyone is 31,” did not take. The company’s revenue peaked at $22.4 billion in 2017 and has been in decline ever since.

On Thursday—four months into his new job—Teva's new CEO Richard Francis unveiled his “pivot to growth” strategy which is built on four “pillars.”

Teva will depend on its “commercial portfolio and biosimilars, innovative pipeline, generics powerhouse and focused capital allocation,” Francis said.

At the New York Stock Exchange, at noon, the company is presenting its new growth strategy to investors.

In the short term, Teva will look for growth from Huntington’s disease treatment Austedo. The company said it expects to generate sales of $2.5 billion from the drug in 2027. Last year, Austedo’s revenues came in at $963 billion.

An FDA approval in February of Teva’s once-a-day formulation of Austedo could help the company reach its target. Teva added that it will work to expand Austedo’s availability in “key geographies.”

In seeking long-term growth, the company looks to expand its pipeline, focusing on its “core therapeutic areas of neuroscience, immunology and immune-oncology, with assets aiming to be first-in-class and best-in-class,” the company said in its release.

As for generics, while Teva still includes the business in its four-pronged strategy and refers to the sector as its “powerhouse,” it appears to be on its way to being de-emphasized. The company says it wants to “sustain” its generics business by focusing on “high-value opportunities,” which would include complex products such as “drug device combinations and long-acting injectables.”

Teva has been in need of a shake-up. The company reported revenue of $14.9 billion for 2022, a 6% slide from the previous year. The company’s generics business posted sales declines in each of its three geographic regions—the U.S., Europe and international. Overall, sales of generics reached $8.6 billion last year, down from $9 billion in 2021.

Teva has projected revenue to come in at between $14.8 billion and $15.4 billion this year. In the first quarter, the company pulled in $3.7 billion, matching its figure for the first quarter of the previous year.

“Teva has made decisive choices to focus its business and allocate resources on areas that show the greatest potential for growth and patient impact,” the company said in its release.