(1)	Including impairments related to exit and disposal activities

Impairments

Impairments of long-lived tangible assets for the three months ended September 30, 2019 and 2018 were $

million and $

million, respectively.

Impairments of long-lived tangible assets for the nine months ended September 30, 2019 and 2018 were $

million and $

255

million, respectively.

Teva may record additional impairments in the future, to the extent it changes its plans on any given asset and/or the assumptions underlying such plans as a result of its plant rationalization plan.

Contingent consideration

In the three months ended September 30, 2019, Teva recorded an expense of $51 million for contingent consideration, compared to an expense of $29 million in the three months ended September 30, 2018. The expenses in the third quarter of 2019 were mainly related to a change in the estimated future royalty payments from Eagle Pharmaceuticals, Inc. (“Eagle”) in connection with bendamustine sales.

In the nine months ended September 30, 2019, Teva recorded an expense of $4 million for contingent consideration, compared to an expense of $84 million in the nine months ended September 30, 2018. The expense in the first nine months of 2019 were mainly related to a change in the estimated future royalty payments from Eagle in connection with bendamustine sales and an increase in the expected future royalty payments to Eagle due to the orphan drug status granted to BENDEKA

, offset by the change in the future royalty payments in connection with lenalidomide (generic equivalent of Revlimid

), which was part of the Actavis Generics acquisition.

Restructuring

In the three months ended September 30, 2019, Teva recorded $61 million of restructuring expenses, compared to $88 million in the three months ended September 30, 2018.

In the nine months ended September 30, 2019, Teva recorded $140 million of restructuring expenses, compared to $442 million in the nine months ended September 30, 2018.

Since the announcement of its restructuring plan, Teva reduced its global headcount by 11,554 full-time-equivalent employees.

During the three months ended September 30, 2019 and 2018, Teva recorded impairments of property, plant and equipment related to restructuring costs of $8 million and $2 million, respectively.

During the nine months ended September 30, 2019 and 2018, Teva recorded impairments of property, plant and equipment related to restructuring costs of $29 million and $155 million, respectively.

The following tables provide the components of costs associated with Teva’s restructuring plan, including other costs associated with Teva’s restructuring plan and recorded under different items:


	Three months ended September 30,
	2019		2018
	(U.S. $ in millions)
Restructuring
Employee termination	$	49	$	62
Other		11		26

Total	$	61	$	88


	Nine months ended September 30,
	2019		2018
	(U.S. $ in millions)
Restructuring
Employee termination	$	105	$	380
Other		34		62

Total	$	140	$	442

The following table provides the components of and changes in the Company’s restructuring accruals:


	Employee termination costs			Other			Total
	(U.S. $ in millions )
Balance as of January 1, 2019	$	(204	)	$	(29	)	$	(233	)
Provision		(105	)		(34	)		(140	)
Utilization and other*		108			56			164

Balance as of September 30, 2019	$	(201	)	$	(7	)	$	(208	)

*	Includes adjustments for foreign currency translation.

Significant regulatory events

In July 2018, the FDA completed an inspection of Teva’s manufacturing plant in Davie, Florida in the United States, and issued a Form FDA-483 to the site. In October 2018, the FDA notified Teva that the inspection of the site is classified as “official action indicated” (OAI). On February 5, 2019, Teva received a warning letter from the FDA that contains four enumerated concerns related to production, quality control, and investigations at this site.

Teva is working diligently to remediate the FDA’s concerns in a manner consistent with current good manufacturing practice (CGMP) requirements, and to address those concerns as quickly and as thoroughly as possible. If Teva is unable to remediate the warning letter findings to the FDA’s satisfaction, it may face additional consequences, including delays in FDA approval for future products from the site, financial implications due to loss of revenues, impairments, inventory write offs, customer penalties, idle capacity charges, costs of additional remediation and possible FDA enforcement action. Teva expects to generate approximately $63

million in revenues from this site in the remainder of 2019 and approximately $

230

million

2020

, assuming remediation or enforcement does not cause any unscheduled slowdown or stoppage at the facility.

In July 2018, Teva announced the voluntary recall of valsartan and certain combination valsartan medicines in various countries due to the detection of trace amounts of a previously unknown impurity called NDMA found in valsartan API supplied to Teva by Zhejiang Huahai Pharmaceutical. Since July 2018, Teva has been actively engaged with regulatory agencies around the world in reviewing its valsartan and other sartan products for NDMA and other related impurities and, where necessary, has initiated additional voluntary recalls.

As of September 30, 2019, the accumulated impact of this recall on Teva’s financial statements

was $55 million, primarily related to inventory reserves and returns. Teva expects to continue to experience loss of revenues and profits in connection with this matter. In addition, multiple lawsuits have been filed in connection with this matter, for which litigation costs are currently being incurred. Teva may also incur additional customer penalties, impairments and litigation costs going forward.