Other assets impairments, restructuring and other items

9 Months Ended

Sep. 30, 2024

Other assets impairments, restructuring and other items

NOTE 12 – Other assets impairments, restructuring and other items:


	Three months ended					Nine months ended
	September 30,					September 30,
	2024			2023		2024			2023
	(U.S. $ in millions)					(U.S. $ in millions)
Impairments of long-lived tangible assets (1)	$	(80	)	$	1	$	589		$	21
Contingent consideration (2)		34			27		305			140
Restructuring		21			27		52			93
Other		1			2		(16	)		21

Total	$	(23	)	$	57	$	931		$	276

(1)	Including impairments related to exit and disposal activities.

(2)	The contingent consideration presented in the tables above for the three and nine months ended September 30, 2023 have been revised as discussed in note 1c.

Impairments

In the three months ended September 30, 2024, Teva recorded an income of

million under impairments of tangible assets, compared to an expense of

million

in the three months ended September 30, 2023.

The income for the three months ended September 30, 2024 was mainly related to a favorable adjustment to the changes of the expected loss from reclassification of currency translation adjustments, partially offset by an additional impairment due to fair value update in connection with the classification of the business venture in Japan as held for sale. See note 2.

Impairments of tangible assets for the nine months ended September 30, 2024 and 2023 were $589 million and $21 million, respectively. The impairment for the nine months ended September 30, 2024 was mainly related to the classification of the business venture in Japan as held for sale (see note 2). The impairments for the nine months ended September 30, 2023 were mainly related to certain assets in the U.S. and Europe.

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 ongoing network consolidation activities and its “Pivot to Growth Strategy”.

Contingent consideration

In the three months ended September 30, 2024, Teva recorded an expense of $34 million for contingent consideration, compared to an expense of $27 million in the three months ended September 30, 2023.

The expenses in the three months ended September 30, 2024 were mainly due to the effect of the passage of time on the net present value of the discounted payments. The expenses in the three months ended September 30, 2023 were mainly related to a change in the estimated future royalty payments to Allergan in connection with lenalidomide capsules (the generic version of Revlimid

) and a change in the estimated future royalty payments to Eagle in connection with expected future bendamustine sales. The expense in the three months ended September 30, 2023 was revised as discussed in note 1c.

In the nine months ended September 30, 2024, Teva recorded an expense of $305 million for contingent consideration, compared to an expense of $140 million in the nine months ended September 30, 2023. The expenses in the first nine months of 2024 and 2023 were mainly related to a change in the estimated future royalty payments to Allergan in connection with lenalidomide capsules (the generic version of Revlimid

) and a change in the estimated future royalty payments to Eagle in connection with expected future bendamustine sales. The expense in the first nine months of 2023 was revised as discussed in note 1c.

Restructuring

In the three months ended September 30, 2024, Teva recorded $21 million of restructuring expenses, compared to $27 million in the three months ended September 30, 2023. Expenses for the three months ended September 30, 2024 and 2023 were primarily related to network consolidation activities.

In the nine months ended September 30, 2024, Teva recorded $52 million of restructuring expenses, compared to $93 million in the nine months ended September 30, 2023. The expenses for the nine months ended September 30, 2024 and 2023 were primarily related to network consolidation activities.

The following tables provide the components of the Company’s restructuring costs:


	Three months ended September 30,
	2024		2023
	(U.S. $ in millions)
Restructuring
Employee termination	$	13	$	16
Other		8		12

Total	$	21	$	27


	Nine months ended September 30,
	2024		2023
	(U.S. $ in millions)
Restructuring
Employee termination	$	33	$	40
Other		19		53

Total	$	52	$	93

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, 2024	$	(75	)	$	(7	)	$	(82	)
Provision		(33	)		(19	)		(52	)
Utilization and other*		52			12			64

Balance as of September 30, 2024	$	(56	)	$	(14	)	$	(70	)


	Employee termination costs			Other			Total
	(U.S. $ in millions)
Balance as of January 1, 2023	$	(112	)	$	(7	)	$	(119	)
Provision		(40	)		(53	)		(93	)
Utilization and other*		77			53			130

Balance as of September 30, 2023	$	(75	)	$	(7	)	$	(82	)

*	Includes adjustments for foreign currency translation.