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Revenue from contracts with customers
 9 Months Ended
Sep. 30, 2023
Revenue from contracts with customers
NOTE 3 – Revenue from contracts with customers:
Disaggregation of revenue
The following table disaggregates Teva’s revenues by major revenue streams. For additional information on disaggregation of revenues, see note 15.
 
   
Three months ended September 30, 2023
  
    
North America
     
Europe
     
International
Markets
     
Other

activities
     
Total
  
                                    
    
(U.S.$ in millions)
  
Sale of goods
      1,603        1,117        453        130        3,303  
Licensing arrangements
      31        13        8        1        53  
Distribution
      367        §        9        —         377  
Other
      §        15        15        86        117  
    
 
 
     
 
 
     
 
 
     
 
 
     
 
 
  
     $ 2,002      $ 1,146      $ 485      $ 217      $
 
 
 3,850  
    
 
 
     
 
 
     
 
 
     
 
 
     
 
 
  

 
§
Represents an amount less than $0.5 million.
 
    
Three months ended September 30, 2022
  
    
North America
     
Europe
     
International
Markets
     
Other
activities
     
Total
  
                                    
    
(U.S.$ in millions)
  
Sale of goods
      1,393        1,034        445        149        3,021  
Licensing arrangements
      37        10        4        1        52  
Distribution
      371        §        12        —         383  
Other
      9        26        14        91        139  
    
 
 
     
 
 
     
 
 
     
 
 
     
 
 
  
     $ 1,809      $ 1,069      $ 475      $ 241      $
 
 
 3,595  
    
 
 
     
 
 
     
 
 
     
 
 
     
 
 
  
 
 
§
Represents an amount less than $0.5 million.     

    
Nine months ended September 30, 2023
  
    
North America
     
Europe
     
International
Markets
     
Other
activities
     
Total
  
                                    
    
(U.S.$ in millions)
  
Sale of goods
      4,500        3,446        1,365        412        9,724  
Licensing arrangements
      75        38        18        4        134  
Distribution
      1,183        §        29        —         1,212  
Other
      §        8        44        265        318  
    
 
 
     
 
 
     
 
 
     
 
 
     
 
 
  
     $ 5,759      $ 3,493      $ 1,456      $ 681      $ 11,389  
    
 
 
     
 
 
     
 
 
     
 
 
     
 
 
  
 
 
§
Represents an amount less than $0.5 million.     
 

    
Nine months ended September 30, 2022
  
    
North America
     
Europe
     
International
Markets
     
Other
activities
     
Total
  
                                    
    
(U.S.$ in millions)
  
Sale of goods
      4,308        3,295        1,338        505        9,447  
Licensing arrangements
      111        36        12        3        162  
Distribution
      1,021        1        38        —         1,060  
Other
      10        65        33        266        373  
    
 
 
     
 
 
     
 
 
     
 
 
     
 
 
  
     $ 5,450      $ 3,396      $ 1,422      $ 773      $ 11,041  
    
 
 
     
 
 
     
 
 
     
 
 
     
 
 
  
 
 
Variable consideration
Variable consideration mainly includes sales reserves and allowances (“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 accounts receivables.
The Company recognizes these provisions at the time of sale and adjusts them if the actual amounts differ from the estimated provisions.
SR&A to U.S. customers comprised approximately 66% of the Company’s total SR&A as of September 30, 2023, with the remaining balance primarily related to customers in Canada and Germany. The changes in SR&A for third-party sales for the nine months ended September 30, 2023 and 2022 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, 2023
  
$
67
 
 
$
1,575
 
 
$
663
 
 
$
991
 
 
$
455
 
 
$
66
 
 
$
3,750
 
 
$
3,817
 
Provisions related to sales made in current year period
  
 
262
 
 
 
2,968
 
 
 
468
 
 
 
5,636
 
 
 
205
 
 
 
73
 
 
 
9,350
 
 
 
9,612
 
Provisions related to sales made in prior periods
  
 
—  
 
 
 
(22
) 
 
 
(33
) 
 
 
(21
) 
 
 
24
 
 
 
—  
 
 
 
(52
) 
 
 
(52
) 
Credits and payments
  
 
(268
) 
 
 
(2,989
) 
 
 
(617
) 
 
 
(5,768
) 
 
 
(251
) 
 
 
(53
) 
 
 
(9,678
) 
 
 
  (9,946
) 
Translation differences
  
 
—  
 
 
 
(8
) 
 
 
(2
) 
 
 
(3
) 
 
 
—  
 
 
 
(6
) 
 
 
(19
) 
 
 
(19
) 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance at September 30, 2023
  
$
61
 
 
$
1,524
 
 
$
479
 
 
$
835
 
 
$
433
 
 
$
  80
 
 
$
3,351
 
 
$
  3,412
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
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, 2022
    $ 68     $ 1,655     $ 854     $ 1,085     $ 535     $ 112     $ 4,241     $ 4,309  
Provisions related to sales made in current year period
      269       2,832       684       5,656       219       226       9,617       9,886  
Provisions related to sales made in prior periods
      —        (103 )      (15 )      (28 )      (9 )      (3 )      (158 )      (158 ) 
Credits and payments
      (285 )      (2,845 )      (762 )      (5,826 )      (300 )      (213 )      (9,946 )      (10,231 ) 
Translation differences
      —        (66 )      (11 )      (17 )      (8 )      (4 )      (106 )      (106 ) 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
Balance at September 30, 2022
    $ 52     $ 1,473     $ 750     $ 870     $ 437     $ 118     $ 3,648     $ 3,700  
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
Pledged accounts receivables
Accounts receivables, net of allowance for credit losses, include $586 million and $436 million as of September 30, 2023 and December 31, 2022, respectively, which are pledged to PNC Bank, National Association in connection with the U.S. securitization program entered into in November 2022.
See note 8f to the consolidated financial statements included in this Quarterly Report on Form 10-Q and
note 10f to the consolidated financial statements for the year ended December 31, 2022, included in Teva’s Annual Report on
F
orm
10-K.