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Segments
 9 Months Ended
Sep. 30, 2021
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,
  
    
2021
  
    
North America
     
Europe
     
International Markets
  
                      
    
(U.S. $ in millions)
  
Revenues
    $ 1,875      $ 1,220      $ 530  
Gross profit
      967        714        296  
R&D expenses
      146        55        16  
S&M expenses
      250        204        102  
G&A expenses
      121        64        29  
Other income
      (7 )       (2 )       (2 ) 
    
 
 
     
 
 
     
 
 
  
Segment profit
    $ 458      $ 394      $ 152  
    
 
 
     
 
 
     
 
 
  
 
§ Represents an amount less than $1 million.
 
    
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  
    
 
 
     
 
 
     
 
 
  
 
    
Nine months ended September 30,
  
    
2021
  
    
North America
     
Europe
     
International Markets
  
                      
    
(U.S. $ in millions)
  
Revenues
    $ 5,807      $ 3,618      $ 1,505  
Gross profit
      3,081        2,063        826  
R&D expenses
      467        184        51  
S&M expenses
      734        628        303  
G&A expenses
      338        180        79  
Other income
      (14 )       (3 )       (5 ) 
    
 
 
     
 
 
     
 
 
  
Segment profit
    $ 1,556      $ 1,074      $ 398  
    
 
 
     
 
 
     
 
 
  
 
    
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  
    
 
 
     
 
 
     
 
 
  
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 mo
n
ths ended September 30, 2021 and 2020:
 
.
   
Three months ended
     
Nine months ended
  
    
September 30,
     
September 30,
  
    
2021
     
2020
     
2021
     
2020
  
                             
    
(U.S. $ in millions)
     
(U.S. $ in millions)
  
North America profit
    $ 458      $ 560      $ 1,556      $ 1,682  
Europe profit
      394        312        1,074        1,058  
International Markets prof
i
t
      152        125        398        378  
    
 
 
     
 
 
     
 
 
     
 
 
  
Total reportable segments profit
      1,004        997        3,028        3,118  
Profit of other activities
      38        28        125        130  
    
 
 
     
 
 
     
 
 
     
 
 
  
Total segments profit
      1,042        1,025        3,153        3,248  
Amounts not allocated to segments:
                                    
Amortization
      199        251        613        758  
Other assets impairments, restructuring and other items
      62        (98 )       227        404  
Goodwill impairment
      —          4,628        —          4,628  
Intangible asset impairments
      21        509        295        1,278  
Legal settlements and loss contingencies
      3        21        113        10  
Other unallocated amounts
      134        55        266        148  
    
 
 
     
 
 
     
 
 
     
 
 
  
Consolidated operating income (loss)
      623        (4,342 )       1,638        (3,978 ) 
    
 
 
     
 
 
     
 
 
     
 
 
  
Financial expenses, net
      241        117        805        565  
    
 
 
     
 
 
     
 
 
     
 
 
  
Consolidated income (loss) before income taxes
    $ 382      $ (4,459 )     $ 833      $ (4,543 ) 
    
 
 
     
 
 
     
 
 
     
 
 
  
 
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, 2021 and 2020:
 
North America
   
Three months ended

September 30,
  
    
2021
     
2020
  
    
(U.S. $ in millions)
  
Generic products
    $ 859      $ 928  
AJOVY
      46        35  
AUSTEDO
      201        168  
BENDEKA
®
/TREANDA
®
      95        105  
COPAXONE
      133        236  
ProAir
®
*
      31        50  
Anda
      363        341  
Other
      146        155  
    
 
 
     
 
 
  
Total
    $ 1,875      $ 2,017  
    
 
 
     
 
 
  
 
*
Does not include revenues from the ProAir authorized generic, which are included under generic products.
 
North America
   
Nine months ended
September 30,
  
    
2021
     
2020
  
    
(U.S. $ in millions)
  
Generic products
    $ 2,864      $ 2,804  
AJOVY
      123        98  
AUSTEDO
      520        451  
BENDEKA/TREANDA
      292        313  
COPAXONE
      448        671  
ProAir*
      140        175  
Anda
      968        1,141  
Other
      451        493  
    
 
 
     
 
 
  
Total
    $ 5,807      $ 6,146  
    
 
 
     
 
 
  
 
*
Does not include revenues from the ProAir authorized generic, which are included under generic products.
Europe
   
Three months ended

September 30,
  
    
2021
     
2020
  
               
    
(U.S. $ in millions)
  
Generic products
    $ 895      $ 824  
AJOVY
      23        8  
COPAXONE
      95        101  
Respiratory products
      85        77  
Other
      122        106  
    
 
 
     
 
 
  
Total
    $ 1,220      $ 1,116  
    
 
 
     
 
 
  
 
Europe
   
Nine months ended
September 30,
  
    
2021
     
2020
  
               
    
(U.S. $ in millions)
  
Generic products
    $ 2,637      $ 2,593  
AJOVY
      58        17  
COPAXONE
      296        294  
Respiratory products
      263        263  
Other
      364        352  
    
 
 
     
 
 
  
Total
    $ 3,618      $ 3,520  
    
 
 
     
 
 
  
 
International markets
   
Three months ended

September 30,
  
    
2021
     
2020
  
               
    
(U.S. $ in millions)
  
Generic products
    $ 412      $ 429  
AJOV
Y
 
 
39
 
 
 
16
 
COPAXONE
      10        14  
Other
      69        71  
    
 
 
     
 
 
  
Total
   
$
 530     
$
 529  
    
 
 
     
 
 
  
 
International markets
   
Nine months ended
September 30,
  
    
2021
     
2020
  
               
    
(U.S. $ in millions)
  
Generic products
    $ 1,211      $ 1,304  
AJOV
Y
 
 
46
 
 
 
17
 
COPAXONE
      29        38  
Other
      219        224  
    
 
 
     
 
 
  
Total
   
$
 1,505     
$
 1,582