Teva Pharmaceutical Industries Limited · TASE:TEVA
Teva Pharmaceutical Industries — Q1 2023 Earnings Presentation
42 slides from Teva Pharmaceutical Industries's earnings presentation, May 10, 2023
Slide 1: First Quarter 2023 Results
Teva Pharmaceutical Industries Ltd. First Quarter 2023 Results May 10, 2023
Slide 2: Cautionary Note Regarding Forward-Looking Statements
Cautionary Note Regarding Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which are based on management’s current beliefs and expectations and are subject to substantial risks and uncertainti
Slide 3: Richard Francis
Richard Francis President and Chief Executive Officer |3|
Slide 4: Impression After 120 Days as CEO
Impression After 120 Days as CEO Strong commercial portfolio Promising innovative pipeline AUSTEDO®, AJOVY®, UZEDYTM and Strong innovative pipeline with upcoming biosimilars proven targets / MoAs Solid core businesses Strong historical capabilities Strong generation of cash to pay down debt "Can do"
Slide 5: Introducing our new strategic framework and key priorities
Introducing our new strategic framework and key priorities focusing on growth and innovation Thursday, May 18 12:00 pm ET Details on Teva’s IR website or via TevaIR@Tevapharm.com |5|
Slide 6: Q1 Revenues Performance
Q1 Revenues Performance % In local currency, compared to Q1 2022 +12% Europe Generics AUSTEDO $170m Successful new +10% product Significant growth launches Revenues of in prescriptions $3.7b International +4% +9% Markets Generics AJOVY $95m Higher revenues across markets +35% |6|
Slide 7: Strong Revenues Growth in Local Currency
Strong Revenues Growth in Local Currency $ millions Total revenue growth of 4% in local currency in local currency in local currency 1,766 1,737 1,184 1,156 492 492 Q1-22 Q1-23 Q1-22 Q1-23 Q1-22 Q1-23 North America Europe International Markets Q1-22 as reported Q1-23 as reported Local currency effec
Slide 8: AUSTEDO Continues to Reach More Patients
AUSTEDO Continues to Reach More Patients ® Continued growth of AUSTEDO prescriptions AUSTEDO quarterly TRx 60,000 57,123 U.S. Revenues $170 million 50,000 40,000 Revenues Growth 30,000 +10% 20,000 10,000 TRx Growth +28% 0 Source: IQVIA US NPA Audit |8| Revenue and TRx data is compared to Q1 2022
Slide 9: AUSTEDO XR Approved in February 2023
AUSTEDO XR Approved in February 2023 Demonstrated efficacy* Three once daily dosing options available Patient sample titration pack available Teva’s shared solutions program provides ongoing patient support Now available in the U.S. for the treatment of TD and chorea for HD * The most common adverse
Slide 10: AJOVY – Global Growth
AJOVY – Global Growth Quarterly Global Net Sales $95m Net global sales of $95 million in Q1 2023: UP Q1’23 32% North America $72m Q1’22 $49 million, +36% 24% U.S. market share Europe $36 million, +17% 30% market share International Markets $10 million, up 74% 2019 2020 2021 2022 Q1’23 North America
Slide 11: UZEDY (risperidone) Now Approved
UZEDY™ (risperidone) Now Approved RAPID ABSORPTION Achieves therapeutic levels in plasma within 6 to 24 hours of administration1,2 STREAMLINED INITIATION ~$4B No loading dose or oral supplementation is required2 FLEXIBLE 1- AND 2-MONTH DOSING INTERVALS LAI 2022 Market size Two dosing intervals and 8
Slide 12: Generics: Strong Growth in Europe and International Markets
Generics: Strong Growth in Europe and International Markets $ millions in local currency in local currency 932 876 400 388 Q1-22 Q1-23 Q1-22 Q1-23 Europe International Markets Q1-22 as reported Q1-23 as reported Local currency effect | 12 |
Slide 13: Teva Innovative Medicine Pipeline
Teva Innovative Medicine Pipeline By development stage – as of May 1, 2023 Under Regulatory Preclinical Phase 1 Phase 2 Phase 3 Pre-Submission Review TEV-56278 TEV-53408 Anti-TL1-A Olanzapine LAI Digihaler® Digihaler® Oncology Gastrointestinal (TEV-48574) Schizophrenia (beclomethasone (budesonide an
Slide 14: Teva Biosimilar Franchise
Teva Biosimilar Franchise By development stage – as of May 1, 2023 Under Regulatory Commercial Preclinical Phase 1 Phase 3 Under Regulatory Pre-Submission Preclinical Phase 3 Review Biosimilar Products1, 2 Review TEV-56285 Biosimilar to Prolia® Biosimilar to & Xgeva ® Humira® TEV-54142 (denosumab) (
Slide 15: Promising Late-Stage Assets Poised to Support Growth
Promising Late-Stage Assets Poised to Support Growth Olanzapine LAI Potential to be first long-acting olanzapine with a ('749) favorable safety profile ICS/SABA ('248) De-risked1 ICS/SABA fixed-dose addressing market needs Anti-TL1-A ('574) Potential to be best-in-class for proven TL1A mechanism in
Slide 16: Our 2022 ESG Progress Report Highlights
Our 2022 ESG Progress Report Highlights Progress toward ambitious targets Economic impact 24% 21 $44 billion reduction in total scope 1 and 2 new regulatory submissions in savings from Teva’s greenhouse gas emissions (vs. in low - and middle-income generic medicines 2019, ahead of schedule to meet c
Slide 17: Eli Kalif
Eli Kalif Executive Vice President, Chief Financial Officer | 17 |
Slide 18: Q1 2023 Summary
Q1 2023 Summary $ millions, except EPS Q1 2023 Q1 2022 Q1 2023 Q1 2022 GAAP Non-GAAP Revenues* 3,661 3,661 3,661 3,661 Operating income (loss) 2 (713) 785 1,013 Net income (loss) attributable to Teva (205) (955) 457 609 (0.18) (0.86) 0.40 0.55 Earnings (loss) per share ($)** 1,115 million 1,107 mill
Slide 19: Non-GAAP Adjustments
Non-GAAP Adjustments $ millions Q1 2023 Comments Amortization 165 Impairment of long-lived assets 188 mainly related to estimated provisions recorded in connection with certain Legal settlements 233 litigation cases in the U.S. Equity Compensation Plans 32 Accelerated depreciation 25 Restructuring 5
Slide 20: Q1 2023 Non-GAAP Summary
Q1 2023 Non-GAAP Summary $ billions, except EPS Q1 2023 Q1 2022 Change Revenues* 3.7 3.7 0% 1.8 2.0 (10%) Gross profit 49.1% 54.2% (5.2%) 0.8 1.0 (23%) Operating income 21.4% 27.7% (6.2%) EBITDA 0.9 1.1 (21%) Net income attributable to Teva 0.5 0.6 (25%) 0.40 0.55 (0.15) EPS ($) 1,128 million 1,112
Slide 21: Spend Base
Spend Base $ millions +229 (+9%) +324 in local currency (+12%) 2,876 2,648 1,675 1,865 (63%) (65%) COGS 1,025 * 1,013 * OPEX * (39%) (35%) Other Income -52 (-2%) -2 (0%) Q1 2022 Q1 2023 Revenues 3,661 3,661 GP% 54.2% 49.1% OP% 27.7% 21.4% | 21 | * OPEX include R&D, S&M and G&A expenses
Slide 22: Site Consolidation
Site Consolidation Number of manufacturing sites 28 3 80 52 49 December 2017 May 2023 December 2023 Continued footprint optimization additional 4 manufacturing sites announced to be divested/closed beyond 2023 | 22 |
Slide 23: Free Cash Flow by Quarters
Free Cash Flow by Quarters $ millions 1,140 795 716 685 625 301 117 59 41 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Free cash flow includes cash flow from operating activities, beneficial interest collected in exchange for securitized accounts receivables, | 23 | procee
Slide 24: Ongoing Debt Reduction
Ongoing Debt Reduction $ billions Net Debt 20.7 20.0 19.0 18.4 18.5 4.8 4.8 4.7 4.6 4.4 EBITDA MAT Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Net Debt / EBITDA MAT* 4.29 4.16 4.02 4.00 4.25 Leverage 69% 69% 69% 71% 71% | 24 | *Teva's Net Debt/EBITDA MAT covenant ratio limits are 4.25x for Q1 2023 - Q3
Slide 25: Net Debt Development
Net Debt Development $ billions $35.0 $34.0 $33.0 $31.0 $29.0 $27.0 $25.0 $23.0 $21.0 $19.0 $18.5 $17.0 Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 | 25 |
Slide 26: Debt Maturity Profile
Debt Maturity Profile As of December 31, 2022 As of March 31, 2023 3.5 3.4 3.4 2.9 3.0 2.5 2.1 2.0 2.1 1.9 2.0 2.0 1.8 1.6 1.6 1.6 1.0 1.0 1.0 0.8 0.8 - - 2023 2024 2025 2026 2027 2028 2029 2030 2031 … 2036 … 2046 2023 2024 2025 2026 2027 2028 2029 2030 2031 … 2036 … 2046 USD EUR CHF New-USD New-EUR
Slide 27: 2023 Non-GAAP Outlook
2023 Non-GAAP Outlook $ billions, except EPS or as noted 2023 Outlook 2022 Actual Revenues* $14.8 – $15.4 $14.9 COPAXONE ($m)* ~500 691 AUSTEDO ($m)* ~1,200 971 AJOVY ($m)* ~400 377 Operating Income 4.0 – 4.4 4.1 Adjusted EBITDA 4.5 – 4.9 4.6 Finance Expenses ($m) ~1,000 904 Tax Rate 14% – 17% 11.7%
Slide 28: In Summary
In Summary Reaffirming our 2023 non-GAAP guidance AUSTEDO and AJOVY continue to drive growth AUSTEDO XR now available in the U.S. UZEDY will commercially launch in the coming days in the U.S. Strong performance in Europe and International Markets Significant focus on cost discipline and working capi
Slide 29: Q&A
Q&A | 29 |
Slide 30: Additional Information
Additional Information
Slide 31: Quarterly GAAP Income Statement
Quarterly GAAP Income Statement Q1 2023 Q1 2022 $ millions, except EPS Q1 2023 Q1 2022 Change Margins Margins Revenues 3,661 3,661 0% COGS 2,079 56.8% 1,921 52.5% 8% 1,582 1,740 (9%) Gross profit 43.2% 47.5% (4.3%) R&D 234 6.4% 225 6.2% 4% S&M 546 14.9% 584 15.9% (6%) G&A 296 8.1% 296 8.1% (0%) Lega
Slide 32: Q1 2023 Foreign Exchange Impact
Q1 2023 Foreign Exchange Impact $ millions Q1 2023 Q1 2022 Diff FX Effect Diff net FX Revenues 3,661 3,661 0 (128) 128 Operating income (loss) 2 (713) 715 (32) 747 GAAP Operating income 785 1,013 (228) (33) (196) Non-GAAP | 32 |
Slide 33: Net Revenue and Non-GAAP Profitability
Net Revenue and Non-GAAP Profitability $ millions 4,100 3,982 3,910 3,887 3,884 3,786 3,661 3,661 3,595 53.8% 53.3% 53.6% 56.1% 54.2% 54.4% 53.0% 54.2% 49.1% 27.1% 26.8% 30.4% 27.7% 26.9% 27.2% 29.1% 26.4% 21.4% Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Net Revenues Non
Slide 34: Revenues by Activity and Geographical Area
Revenues by Activity and Geographical Area $ millions Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 North America Segment 1,737 1,904 1,809 2,002 1,766 Generic products 899 1,026 806 818 824 AJOVY® 36 49 57 75 49 AUSTEDO® 154 204 260 344 170 BENDEKA®/TREANDA® 82 83 77 75 63 COPAXONE® 86 94 105 101 76 Anda 342 308 3
Slide 35: Non-GAAP Profits and EPS
Non-GAAP Profits and EPS $ millions, EPS in $ 1,248 1,130 1,077 1,019 1,034 1,042 1,013 977 785 854 754 791 699 651 651 658 609 0.77 0.68 0.71 457 0.63 0.59 0.59 0.55 0.59 0.40 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Non-GAAP Net Income Non-GAAP Operating Income Non-G
Slide 36: Q1 2023 Non-GAAP Operating Income
Q1 2023 Non-GAAP Operating Income $ millions -$228m (-23%) -$196m Local currency (-19%) (70) (36) (65) (58) 1,013 785 Q1-22 North America Europe International Markets Other Activities Q1-23 | 36 |
Slide 37: Quarterly Non-GAAP Operating Income
Quarterly Non-GAAP Operating Income $ millions 1,130 37 (3%) 1,013 1,019 93 (8%) 977 51 (5%) 55 (5%) 29 (3%) 95 (9%) 112 (11%) 179 (18%) 366 785 (32%) 389 114 (15%) 360 381 (38%) (37%) (38%) 345 (44%) 633 481 477 (56%) 402 (47%) (49%) (40%) 332 (42%) -6 (-1%) Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 North Amer
Slide 38: Quarterly Adjusted EBITDA
Quarterly Adjusted EBITDA* $ millions 1,240 1,135 1,134 1,089 899 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 | 38 | Please see our press release reporting our financial results for the first quarter of 2023 for a reconciliation of Adjusted EBITDA to its nearest GAAP equivalent
Slide 39: Q1 2023 Adjusted EBITDA to Free Cash Flow
Q1 2023 Adjusted EBITDA to Free Cash Flow $ millions (858) (95%) (279) (83) 899 (186) (245) 2 78 (139) (328) 323 41 (145) Non-GAAP Interest Tax payments AR Inventory AP & Other Securitization Operating Securitization Asset sales, Free cash flow EBITDA payments, net cash flow reclass net; Capex gross
Slide 40: Consolidated Balance Sheet
Consolidated Balance Sheet $ billions Mar 31, 2023 Dec 31, 2022 Diff Cash and Cash Equivalents 2.1 2.8 (0.7) AR Trade 3.4 3.7 (0.3) Pre-paid Expenses and Other Current Assets 1.8 1.7 0.1 Inventory 4.1 3.8 0.3 Fixed Assets 5.8 5.7 0.0 Intangible Assets 6.0 6.3 (0.3) Goodwill 17.8 17.6 0.2 Other Long
Slide 41: Q1 2023 Debt Movements
Q1 2023 Debt Movements $ billions 2.5 2.5 21.2 0.6 0.2 20.7 2.1 18.5 Dec 31, Debt issued Debt Debt FX and Mar 31, Cash Mar 31, 2022 tendered repayment Other 2023 balance 2023 Gross Debt Gross Debt Net Debt | 41 |
Slide 42: Slide 42
Teva Pharmaceutical Industries — Q1 2023 Earnings Presentation on 6ix