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v3.20.2

Segments | 9 Months Ended
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Sep. 30, 2020
Segments | NOTE 15 – Segments:
| Teva | operates its business and reports its financial results in three segments:
| (a) | North America segment, which includes the United States and Canada.
| (b) | Europe segment, which includes the European Union and certain other European countries.
| (c) | International Markets segment, which includes all countries other than those in the North America and Europe segments.
In addition to these three segments, Teva has other sources of revenues, primarily the sale of APIs to third parties, certain contract manufacturing services and an out-licensing platform offering a portfolio of products to other pharmaceutical companies through its affiliate Medis. Teva’s Chief Executive Officer (“CEO”), who is the chief operating decision maker (“CODM”), reviews financial information prepared on a consolidated basis, accompanied by disaggregated information about revenues and contributed profit by the three identified reportable segments, namely North America, Europe and International Markets, to make decisions about resources to be allocated to the segments and assess their performance. Segment profit is comprised of gross profit for the segment less R&D expenses, S&M expenses, G&A expenses and other income related to the segment. Segment profit does not include amortization and certain other items. Teva manages its assets on a company basis, not by segments, as many of its assets are shared or commingled. Teva’s CODM does not regularly review asset information by reportable segment and, therefore, Teva does not report asset information by reportable segment. Teva’s CEO may review its strategy and organizational structure from time to time. Any changes in strategy may lead to a reevaluation of the Company’s segments and goodwill allocation to reporting units, as well as fair value attributable to its reporting units. See note 3 and note 6.
a. | Segment information:
|  | Three months ended September 30, |
|  | 2020 |
|  | North America |  |  | Europe |  |  | International Markets |
|  | (U.S. $ in millions) |
Revenues |  | $ | 2,017 |  |  | $ | 1,116 |  |  | $ | 529 |
Gross profit |  |  | 1,056 |  |  |  | 637 |  |  |  | 275 |
R&D expenses |  |  | 155 |  |  |  | 60 |  |  |  | 17 |
S&M expenses |  |  | 250 |  |  |  | 200 |  |  |  | 101 |
G&A expenses |  |  | 97 |  |  |  | 66 |  |  |  | 33 |
Other income |  |  | (5 | ) |  |  | (1 | ) |  |  | (1 | )
Segment profit |  | $ | 560 |  |  | $ | 312 |  |  | $ | 125 |
|  | Three months ended September 30, |
|  | 2019 |
|  | North America |  |  | Europe |  |  | International Markets* |
|  | (U.S. $ in millions) |
Revenues |  | $ | 2,051 |  |  | $ | 1,163 |  |  | $ | 565 |
Gross profit |  |  | 1,048 |  |  |  | 662 |  |  |  | 295 |
R&D expenses |  |  | 156 |  |  |  | 63 |  |  |  | 21 |
S&M expenses |  |  | 219 |  |  |  | 206 |  |  |  | 114 |
G&A expenses |  |  | 112 |  |  |  | 56 |  |  |  | 32 |
Other (income) expense |  |  | (5 | ) |  |  | (4 | ) |  |  | (1 | )
Segment profit |  | $ | 565 |  |  | $ | 341 |  |  | $ | 130 |
|  | Nine months ended September 30, |
|  | 2020 |
|  | North America |  |  | Europe |  |  | International Markets |
|  | (U.S. $ in millions) |
Revenues |  | $ | 6,146 |  |  | $ | 3,520 |  |  | $ | 1,582 |
Gross profit |  |  | 3,208 |  |  |  | 2,009 |  |  |  | 828 |
R&D expenses |  |  | 455 |  |  |  | 180 |  |  |  | 51 |
S&M expenses |  |  | 755 |  |  |  | 590 |  |  |  | 312 |
G&A expenses |  |  | 325 |  |  |  | 184 |  |  |  | 96 |
Other income |  |  | (9 | ) |  |  | (3 | ) |  |  | (10 | )
Segment profit |  | $ | 1,682 |  |  | $ | 1,058 |  |  | $ | 378 |
|  | Nine months ended September 30, |
|  | 2019 |
|  | North America |  |  | Europe |  |  | International Markets* |
|  | (U.S. $ in millions) |
Revenues |  | $ | 6,169 |  |  | $ | 3,611 |  |  | $ | 1,668 |
Gross profit |  |  | 3,155 |  |  |  | 2,066 |  |  |  | 877 |
R&D expenses |  |  | 497 |  |  |  | 199 |  |  |  | 66 |
S&M expenses |  |  | 756 |  |  |  | 637 |  |  |  | 348 |
G&A expenses |  |  | 342 |  |  |  | 175 |  |  |  | 102 |
Other income |  |  | (6 | ) |  |  | (5 | ) |  |  | (2 | )
Segment profit |  | $ | 1,566 |  |  | $ | 1,060 |  |  | $ | 363 |
* | The data presented for 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 1c.
The following table presents a reconciliation of Teva’s segment profits to its consolidated operating income (loss) and to consolidated income (loss) before income taxes for the three and nine months ended September 30, 2020 and 2019:
|  | Three months ended |  |  | Nine months ended |
|  | September 30, |  |  | September 30, |
|  | 2020 |  |  | 2019 |  |  | 2020 |  |  | 2019 |
|  | (U.S. $ in millions) |  |  | (U.S. $ in millions) |
North America profit |  | $ | 560 |  |  | $ | 565 |  |  | $ | 1,682 |  |  | $ | 1,566 |
Europe profit |  |  | 312 |  |  |  | 341 |  |  |  | 1,058 |  |  |  | 1,060 |
International Markets profit |  |  | 125 |  |  |  | 130 |  |  |  | 378 |  |  |  | 363 |
Total reportable segments profit |  |  | 997 |  |  |  | 1,036 |  |  |  | 3,118 |  |  |  | 2,989 |
Profit of other activities |  |  | 28 |  |  |  | 16 |  |  |  | 130 |  |  |  | 92 |
Total segments profit |  |  | 1,025 |  |  |  | 1,051 |  |  |  | 3,248 |  |  |  | 3,081 |
Amounts not allocated to segments: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Amortization |  |  | 251 |  |  |  | 255 |  |  |  | 758 |  |  |  | 823 |
Other assets impairments, restructuring and other items |  |  | (98 | ) |  |  | 160 |  |  |  | 404 |  |  |  | 263 |
Intangible asset impairments |  |  | 509 |  |  |  | 177 |  |  |  | 1,278 |  |  |  | 1,206 |
Goodwill impairment |  |  | 4,628 |  |  |  | — |  |  |  | 4,628 |  |  |  | — |
Legal settlements and loss contingencies |  |  | 21 |  |  |  | 468 |  |  |  | 10 |  |  |  | 1,171 |
Other unallocated amounts |  |  | 55 |  |  |  | 73 |  |  |  | 148 |  |  |  | 209 |
Consolidated operating income (loss) |  |  | (4,342 | ) |  |  | (81 | ) |  |  | (3,978 | ) |  |  | (591 | )
Financial expenses, net |  |  | 117 |  |  |  | 211 |  |  |  | 565 |  |  |  | 635 |
Consolidated income (loss) before income taxe s |  | $ | (4,459 | ) |  | $ | (292 | ) |  | $ | (4,543 | ) |  | $ | (1,226 | )
b. Segment revenues by major products and activities: The following tables present revenues by major products and activities for the three and nine months ended September 30, 2020 and 2019:
North America |  | Three months ended September 30, |
|  | 2020 |  |  | 2019 |
|  | (U.S. $ in millions) |
Generic products |  | $ | 928 |  |  | $ | 914 |
AJOVY |  |  | 35 |  |  |  | 25 |
AUSTEDO |  |  | 168 |  |  |  | 105 |
BENDEKA ® /TREANDA ® |  |  | 105 |  |  |  | 124 |
COPAXONE |  |  | 236 |  |  |  | 271 |
ProAir ® * |  |  | 50 |  |  |  | 71 |
QVAR ® |  |  | 42 |  |  |  | 60 |
Anda |  |  | 341 |  |  |  | 351 |
Other |  |  | 113 |  |  |  | 131 |
Total |  | $ | 2,017 |  |  | $ | 2,051 |
* | Does not include revenues from the ProAir authorized generic, which are included under generic products.
North America |  | Nine months ended September 30, |
|  | 2020 |  |  | 2019 |
|  | (U.S. $ in millions) |
Generic products |  | $ | 2,804 |  |  | $ | 2,826 |
AJOVY |  |  | 98 |  |  |  | 68 |
AUSTEDO |  |  | 451 |  |  |  | 276 |
BENDEKA/TREANDA |  |  | 313 |  |  |  | 371 |
COPAXONE |  |  | 671 |  |  |  | 753 |
ProAir* |  |  | 175 |  |  |  | 194 |
QVAR |  |  | 139 |  |  |  | 183 |
Anda |  |  | 1,141 |  |  |  | 1,080 |
Other |  |  | 354 |  |  |  | 417 |
Total |  | $ | 6,146 |  |  | $ | 6,169 |
* | Does not include revenues from the ProAir authorized generic, which are included under generic products.
Europe |  | Three months ended September 30, |
|  | 2020 |  |  | 2019 |
|  | (U.S. $ in millions) |
Generic products |  | $ | 824 |  |  | $ | 836 |
COPAXONE |  |  | 101 |  |  |  | 106 |
Respiratory products |  |  | 77 |  |  |  | 87 |
AJOVY |  |  | 8 |  |  |  | 1 |
Other |  |  | 106 |  |  |  | 134 |
Total |  | $ | 1,116 |  |  | $ | 1,163 |
Europe |  | Nine months ended September 30, |
|  | 2020 |  |  | 2019 |
|  | (U.S. $ in millions) |
Generic products |  | $ | 2,593 |  |  | $ | 2,599 |
COPAXONE |  |  | 294 |  |  |  | 327 |
Respiratory products |  |  | 263 |  |  |  | 267 |
AJOVY |  |  | 17 |  |  |  | 1 |
Other |  |  | 352 |  |  |  | 416 |
Total |  | $ | 3,520 |  |  | $ | 3,611 |
International Markets |  | Three months ended September 30, |
|  | 2020 |  |  | 2019 |
|  | (U.S. $ in millions) |
Generic products |  | $ | 429 |  |  | $ | 474 |
COPAXONE |  |  | 14 |  |  |  | 20 |
Other |  |  | 86 |  |  |  | 71 |
Total |  | $ | 529 |  |  | $ | 565 |
* | The data presented for 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 1c.
International Markets |  | Nine months ended September 30, |
|  | 2020 |  |  | 2019 |
|  | (U.S. $ in millions) |
Generic products |  | $ | 1,304 |  |  | $ | 1,404 |
COPAXONE |  |  | 38 |  |  |  | 46 |
Other |  |  | 241 |  |  |  | 218 |
Total |  | $ | 1,582 |  |  | $ | 1,668 |
* | The data presented for 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 1c.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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