Teva Pharmaceutical Industries ($TEVA) has been the world's biggest generics player for years. Problem is, it's trying to be more than that. And makeovers take time. Midway through last year, analysts were clucking about U.S. sales, worrying that the company's revenue goals were out of reach.
Now, Teva watchers are giving a qualified thumbs up to the fourth quarter--"relatively strong compared with the rest of the year," one said--but still clucking about the future. A good bit of the company's 28% sales increase came from Copaxone, the multiple sclerosis drug that soon will face generic rivals. Another big chunk came from its purchase of Cephalon, but that unit's biggest seller, the narcolepsy drug Provigil, goes off patent in April.
Meanwhile, the European drug market is still weak, even for generics. U.S. generics sales did recover somewhat for the quarter, but were down 32% on the year. The company may have to wait until it launches copycat Lipitor in May and generic Lexapro in March to really see a U.S. sales surge.
CEO Shlomo Yanai, who's retiring in May, talked up the company's pipeline of branded products. He's upbeat about a potential new MS drug, laquinimod, despite some disappointing trial results. "I am optimistic about the continued growth of Teva in the branded products sector," Yanai said.
But the real hope may lie with incoming CEO Jeremy Levin, late of Bristol-Myers Squibb ($BMY). "I hope that in May he knows exactly what he wants to do because he doesn't have time to waste," Excellence Nessuah Brokerage analyst Gilad Alper told Bloomberg. "Whatever Levin wants to do, he'll need a lot of money. He needs the goodwill of lenders, and that will decline rather quickly if Copaxone market share declines."
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