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Revenue from contracts with customers
 12 Months Ended
Dec. 31, 2019
Revenue from contracts with customers
NOTE 3—Revenue from contracts with customers:
On January 1, 2018, Teva adopted the new revenue standard to all contracts using the modified retrospective method. The cumulative initial effect of applying the new revenue standard was immaterial.
Revenue recognition prior to and following the adoption of the new revenue standard
See note 1 for a summary of the significant accounting policies.
Disaggregation of revenue
The following table disaggregates Teva’s revenues by major revenue streams. For additional information on disaggregation of revenues, see note 19.
 
Year ended December 31, 201
9
  
  
North
America
 
  
Europe
 
  
International
Markets
 
  
Other
activities
 
  
Total
 
  
(U.S.
 
$ in millions)
 
Sale of goods
   
6,941
     
4,770
     
2,045
     
754
     
14,510
 
Licensing arrangements
   
109
     
29
     
4
     
5
     
147
 
Distribution
   
1,492
     
2
     
20
     
—  
      
1,514
 
Other
   
§
      
(6
)    
177
     
545
     
716
 
                                         
   $
8,542
    $
4,795
    $
2,246
    $
1,304
    $
16,887
 
                                         
  
Year ended December 31, 201
8
  
  
North
America
 
  
Europe
 
  
International
Markets
 
  
Other
activities
 
  
Total
 
  
(U.S.
 
$ in millions)
 
Sale
of goods
 
 
7,838
 
 
 
5,153
 
 
 
2,151
 
 
 
739
 
 
 
15,881
 
Licensing arrangements
 
 
111
 
 
 
23
 
 
 
22
 
 
 
9
 
 
 
165
 
Distribution
 
 
1,347
 
 
 
7
 
 
 
19
 
 
 
—  
 
 
 
1,373
 
Other
 
 
1
 
 
 
3
 
 
 
230
 
 
 
618
 
 
 
852
 
 
$
9,297
 
 
$
5,186
 
 
$
2,422
 
 
$
1,366
 
 
$
18,271
 
  
Year ended December 31, 201
7
  
  
North
America
 
  
Europe
 
  
International
Markets
 
  
Other
activities
 
  
Total
 
  
(U.S.
 
$ in millions)
 
Sale of goods
 
 
10,706
 
 
 
5,244
 
 
 
2,558
 
 
 
748
 
 
 
19,256
 
Licensing arrangements
 
 
281
 
 
 
3
 
 
 
38
 
 
 
5
 
 
 
327
 
Distribution
 
 
1,153
 
 
 
214
 
 
 
17
 
 
 
—  
 
 
 
1,384
 
Other
 
 
1
 
 
 
5
 
 
 
250
 
 
 
630
 
 
 
886
 
 
$
12,141
 
 
$
5,466
 
 
$
2,863
 
 
$
1,383
 
 
$
21,853
 
 
§
Represents an amount less than $1 million
.
The financial data presented in the tables above with respect to prior periods have been revised to reflect a revision in the presentation of net revenues and cost of sales in the consolidated financial statements. See note 1b.
Variable consideration
Variable consideration mainly includes SR&A, comprised of rebates (including Medicaid and other governmental program discounts), chargebacks, returns and other promotional (including shelf stock adjustments) items. Provisions for prompt payment discounts are netted against trade receivables.
The Company recognizes these provisions at the time of sale and adjusts them if the actual amounts differ from the estimated provisions. For description of the nature of each deduction and how provisions are estimated see
 n
ote
 1.
SR&A to U.S. customers comprised approximately 83% of the Company’s total SR&A as of December 31, 2019, with the remaining balance primarily in Canada and Germany. The changes in SR&A for third-party sales for the period ended December 31, 2018 and 2019 were as follows:
                                                                 
 
 
Sales Reserves and Allowances
 
 
  
 
 
 
Reserves
included in
Accounts
Receivable, net
 
 
Rebates
 
 
Medicaid and
other
governmental
allowances
 
 
Chargebacks
 
 
Returns
 
 
Other
 
 
Total
reserves
included in
Sales
Reserves
and
Allowances
 
 
Total
 
 
  
(U.S. $ in millions)
  
Balance at January 1, 2018
 
 
 
 
$
196
 
 
$
3,077
 
 
$
1,908
 
 
$
1,849
 
 
$
780
 
 
$
267
 
 
$
7,881
 
 
$
8,077
 
Provisions related to sales made in current year period
 
 
514
 
 
 
6,572
 
 
 
1,284
 
 
 
10,206
 
 
 
442
 
 
 
417
 
 
 
18,899
 
 
$
19,413
 
Provisions related to sales made in prior
periods
 
 
3
 
 
 
(14
)
 
 
24
 
 
 
—
 
 
 
28
 
 
 
(30
)
 
 
(62
)
 
$
(59
)
Credits and payments
 
 
(538
)
 
 
(6,596
)
 
 
(1,850
)
 
 
(10,519
)
 
 
(606
)
 
 
(463
)
 
 
(19,942
)
 
$
(20,480
)
Translation differences
 
 
—
 
 
 
(33
)
 
 
(5
)
 
 
(6
)
 
 
(6
)
 
 
(15
)
 
 
(65
)
 
$
(65
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance at December 31, 2018
  $
175
    
$
3,006
     $
1,361
     $
1,530
     $
638
     $
176
     $
6,711
     $
6,886
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provisions related to sales made in current year
period
   
383
     
5,552
     
976
     
9,565
     
281
     
394
     
16,767
    $
17,150
 
Provisions related to sales made in prior
periods
   
—
     
(92
 )    
(151
)     
(17
)
    
77
     
(6
 )     
(189
)    $
(189
)
Credits and payments
   
(471
 )    
(5,570
 )     
(1,076
 )    
(9,736
 )    
(360
 )    
(392
 )    
(17,134
 )   $
(17,605
 )
Translation differences
   
—  
      
(1
)
    
(1
 )    
1
      
1
      
4
      
4
     $
4
 
                                                                 
Balance at December 31, 201
9
   $
87
   
$
2,895
    $
1,109
    $
1,342
    $
637
    $
176
    $
6,159
    $
6,246