Happy Friday, readers!
A couple of weeks ago, I spoke with Teva CEO Kare Schultz at the New York Stock Exchange (NYSE), where he was ringing the closing bell on February 13. The company had just issued its fourth quarter and full-year 2018 earnings report, which were met with some investor disappointment.
That kind of disappointment has been common for Teva over the past few years. Since March of 2017, the Israel-based generic and branded drug giant has seen its market value slashed in half. A balance sheet loaded with tens of billions of dollars in debt and major competitive headwinds led to wide-scale executive shakeups. Schultz, a 30-year veteran of the pharmaceutical industry, was brought in as the firm’s new president and CEO in November 2017. And, despite a difficult road to recovery, he touts an aggressive plan to right the ship at Teva.
“When I was approached my initial reaction when I looked at the numbers was, Why on earth would I even look at that? Because it looked pretty bad,” Schultz told Fortune. “But then I got interested because I like companies that do great products, and it turned out that Teva had this amazing portfolio of drugs that they developed on their own, in multiple sclerosis, in Parkinson’s, and other diseases.”
Schultz’s mission has been to take a jackhammer to the company’s organizational structure in an effort to reorient its balance sheet, which included some $35 billion in debt fueled in part by a series of expensive acquisitions (some of which turned out be not-so-lucrative, according to Schultz). Generic competition for its star, branded multiple sclerosis drug Copaxone, combined with an increasingly dour landscape in its lead U.S. market for generic drugs, hasn’t helped.
But Schultz remains optimistic. “With a significant restructuring, it’s possible to actually turn the ship around,” he said. The strategy going forward will focus on debt reduction—a somewhat painful endeavor involving the elimination of 25% of Teva’s workforce—that will slash $3 billion from the firm’s spending base; a series of new branded product launches, such as the recently FDA-approved migraine treatment Ajovy; and an effort to stabilize the flagging U.S. generics business.
“I came in with a clarified strategy in my head and backing from the board to actually do it,” said Schultz. Time will tell if that strategy pans out.
Read on for the day’s news, and have a wonderful weekend.
House intel committee chair wants Amazon to answer for anti-vaxxer promotion. House Intelligence Committee chairman Rep. Adam Schiff (D-CA) put Amazon CEO Jeff Bezos on the hot seat in a letter on Friday, demanding answers on medically inaccurate anti-vaccine content Schiff says that Amazon effectively promotes on its platform. "A report by CNN found that on Amazon, suggested searches related to vaccines often led users to publications or videos providing medically and scientifically inaccurate information... I am concerned about the report that Amazon accepts paid advertising that contains deliberate misinformation about vaccines, promoting these advertisements as suggested content ahead of intended search results."
Philippines prosecutors prepare charges against Sanofi. The Philippine Department of Justice is readying charges against officials from French drug giant Sanofi and former Philippine health officials over a dengue vaccine that's been mired in controversy. The Philippines undertook a widespread vaccination campaign with the product, Dengvaxia, before Sanofi admitted that the treatment could actually worsen the disease in some people who had never been infected before; Sanofi took strong exception to the Philippine Justice Department findings and said it will vigorously defend any employees who may be indicted in the probe. (Reuters)
Another blood pressure medication recall. The Food and Drug Administration (FDA) has recalled yet another lot of blood pressure medications over the presence of a potentially cancer-causing impurity. The lot of Losartan potassium tablets contains a different probably carcinogen than what's led to other common hypertension meds' recalls in recent months. (Fortune)
THE BIG PICTURE
Insurers, pharma, hospitals join forces to fight Medicare for All. It sounds impossible—could an issue actually unite the ever-sniping, heavy-hitting lobbyists of the insurance, pharmaceutical, physician, and hospital industries? Turns out, Medicare for All can! The Partnership for America's Health Care Future (founded last year) has been taking an increasingly aggressive and public stance against various Democratic proposals to enact single payer or single payer-ish policies, arguing such a route would limit patient choice, increase taxes, and otherwise diminish the quality of U.S. health care. With nearly every major Democrat vying for the 2020 nomination generally in support of Medicare for All or some form of a public option, expect the lobbying efforts to intensify.
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