XML 37 R27.htm IDEA: XBRL DOCUMENT v3.24.3
Segments
 9 Months Ended
Sep. 30, 2024
Segments
NOTE 15 – Segments:
Teva operates its business and reports its financial results in three
segments
:
(a) United States segment.
(b) Europe segment, which includes the European Union, the United Kingdom and certain other European countries.
(c) International Markets segment, which includes all countries other than the United States and countries included in the Europe segment.
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 United States, 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. Based on such review, in May 2023 Teva launched its new Pivot to Growth strategy. Any additional 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.
In conjunction with a recent shift in executive management responsibilities and in alignment with Teva’s Pivot to Growth strategy, Teva decided that Canada is no longer included as part of Teva’s North America segment as of January 1, 2024. From that date Canada is reported as part of the Company’s International Markets segment and Teva’s North America segment has been renamed the United States segment. Teva aligned its internal financial and segment reporting and its reporting units in accordance with this change effective January 1, 2024. Prior period amounts have been recast to conform to the reporting structure for the current year.
On January 31, 2024, Teva announced that it intends to divest its API business (including its R&D, manufacturing and commercial activities) through a sale, which divestment is expected to be completed in the first half of 2025. The intention to divest is in alignment with Teva’s Pivot to Growth strategy. However, there can be no assurance regarding the ultimate timing or structure of a potential divestiture or that a divestiture will be agreed or completed at all.
 
 
a.
Segment information:
 
    
Three months ended September 30,
  
    
2024
  
    
United States
     
Europe
     
International Markets
  
    
(U.S. $ in millions)
  
Revenues
    $ 2,225      $ 1,265      $ 613  
Gross profit
      1,265        698        306  
R&D expenses
      151        55        27  
S&M expenses
      259        203        134  
G&A expenses
      107        67        36  
Other
 loss
(
income
)
      §        1        §  
  
 
 
     
 
 
     
 
 
  
Segment profit
    $ 748      $ 373      $ 109  
  
 
 
     
 
 
     
 
 
  
        
 
 
§
Represents an amount less than $0.5 million.
 
    
Three months ended September 30,
  
    
2023
  
    
United States
     
Europe
     
International Markets
  
    
(U.S. $ in millions)
  
Revenues
    $ 1,896      $ 1,146      $ 591  
Gross profit
      1,060        648        293  
R&D expenses
      156        62        30  
S&M expenses
      243        184        116  
G&A expenses
      93        66        33  
Other
 loss
(
income
)
      (2 )       §        (2 ) 
  
 
 
     
 
 
     
 
 
  
Segment profit
    $ 571      $ 338      $ 117  
  
 
 
     
 
 
     
 
 
  
     
 
§
Represents an amount less than $0.5 million.
 
    
Nine months ended September 30,
  
    
2024
  
    
United States
     
Europe
     
International Markets
  
    
(U.S. $ in millions)
  
Revenues
    $ 6,060      $ 3,749      $ 1,802  
Gross profit
      3,291        2,113        889  
R&D expenses
      475        173        85  
S&M expenses
      789        605        397  
G&A expenses
      300        197        109  
Other
 loss
(
income
)
      (1 )       1        (1 ) 
  
 
 
     
 
 
     
 
 
  
Segment profit
    $ 1,727      $ 1,137      $ 299  
  
 
 
     
 
 
     
 
 
  
    
Nine months ended September 30,
  
    
2023
  
    
United States
     
Europe
     
International Markets
  
    
(U.S. $ in millions)
  
Revenues
    $ 5,465      $ 3,493      $ 1,750  
Gross profit
      2,866        1,943        861  
R&D expenses
      460        168        81  
S&M expenses
      700        565        353  
G&A expenses
      289        196        105  
Other
loss (
income
)
      (3 )       (2 )       (34 ) 
  
 
 
     
 
 
     
 
 
  
Segment profit
    $ 1,421      $ 1,017      $ 356  
  
 
 
     
 
 
     
 
 
  
 
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, 2024 and 2023
:

 
 
  
Three months ended
 
  
Nine months ended
 
 
  
September 30,
 
  
September 30,
 
 
  
2024
 
  
2023
 
  
2024
 
  
2023
 
 
  
(U.S. $ in millions)
 
  
(U.S. $ in millions)
 
United States profit
    $ 748      $ 571      $ 1,727      $ 1,421  
Europe profit
      373        338        1,137        1,017  
International Markets profit
      109        117        299        356  
  
 
 
     
 
 
     
 
 
     
 
 
  
Total reportable segments profit
      1,230        1,025        3,163        2,794  
Profit (loss) of other activities
      (16 )       (5 )       (1 )       22  
  
 
 
     
 
 
     
 
 
     
 
 
  
Total segments profit
      1,214        1,020        3,162        2,816  
Amounts not allocated to segments:
            
Amortization
      146        145        444        471  
Other assets impairments, restructuring and other items*
      (23 )      57        931        276  
Goodwill impairment
      600        —         1,000        700  
Intangible assets impairments
      28        47        169        289  
Legal settlements and loss contingencies
      450        314        638        1,009  
Other unallocated amounts
      64        112        254        394  
  
 
 
     
 
 
     
 
 
     
 
 
  
Consolidated operating income (loss) *
      (51 )      344        (274 )      (323 ) 
  
 
 
     
 
 
     
 
 
     
 
 
  
Financial expenses, net
      272        280        763        808  
  
 
 
     
 
 
     
 
 
     
 
 
  
Consolidated income (loss) before income taxes *
    $ (324 )    $ 64      $ (1,037 )    $ (1,131 ) 
  
 
 
     
 
 
     
 
 
     
 
 
  

*
The data presented for the prior period have been revised to reflect a revision in the presentation of these items in the consolidated financial statements. For additional information see note 1c.
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, 2024 and 2023:
 
United States   
Three months ended

September 30,
  
    
2024
     
2023
  
    
(U.S. $ in millions)
  
Generic products
    $ 1,094      $ 839  
AJOVY
®
      58        56  
AUSTEDO
      435        339  
BENDEKA
®
and TREANDA
®
      40        56  
COPAXONE
      69        98  
UZEDY
      35        2  
Anda
      380        367  
Other
      115        140  
  
 
 
     
 
 
  
Total
    $ 2,225      $ 1,896  
  
 
 
     
 
 
  
 
                                     
United States
   
Nine months ended September 30,
  
    
2024
     
2023
  
    
(U.S. $ in millions)
  
Generic products
   
$
2,924
 
   
$
2,471
 
AJOVY
   
 
144
 
   
 
154
 
AUSTEDO
   
 
1,124
 
   
 
817
 
BENDEKA and TREANDA
   
 
127
 
   
 
185
 
COPAXONE
   
 
179
 
   
 
224
 
UZEDY
   
 
75
 
   
 
14
 
Anda
   
 
1,134
 
   
 
1,183
 
Other
   
 
352
 
   
 
417
 
  
 
 
     
 
 
  
Total
   
$
6,060
 
   
$
5,465
 
  
 
 
     
 
 
  
 
                                     
Europe
   
Three months ended

September 30,
  
    
2024
     
2023
  
    
(U.S. $ in millions)
  
Generic products
   
$
973
 
   
$
886
 
AJOVY
   
 
56
 
   
 
41
 
COPAXONE
   
 
53
 
   
 
55
 
Respiratory products
   
 
60
 
   
 
61
 
Other*
   
 
124
 
   
 
104
 
  
 
 
     
 
 
  
Total
   
$
1,265
 
   
$
1,146
 
  
 
 
     
 
 
  

*
Other revenues in the third quarter of 2024 include the sale of certain product rights.
 
                                     
Europe
   
Nine months ended September 30,
  
    
2024
       
2023
  
    
(U.S. $ in millions)
  
Generic products
   
$
2,947
 
     
$
2,727
 
AJOVY
   
 
158
 
     
 
115
 
COPAXONE
   
 
163
 
     
 
174
 
Respiratory products
   
 
183
 
     
 
195
 
Other*
   
 
299
 
     
 
282
 
  
 
 
       
 
 
  
Total
   
$
3,749
 
     
$
3,493
 
  
 
 
       
 
 
  

*
Other revenues in the first nine months of 2024 include the sale of certain product rights.
 
               
               
International markets
   
Three months ended

September 30,
  
    
2024
     
2023
  
    
(U.S. $ in millions)
  
Generic products
   
$
477
 
   
$
470
 
AJOVY
   
 
24
 
   
 
18
 
COPAXONE
   
 
13
 
   
 
16
 
Other*
   
 
99
 
   
 
87
 
  
 
 
     
 
 
  
Total
   
$
613
 
   
$
591
 
  
 
 
     
 
 
  

*
Other revenues in the third quarter of 2024 include the sale of certain product rights.
 
               
               
International markets
   
Nine months ended
September 30,
  
    
2024
       
2023
  
    
(U.S. $ in millions)
  
Generic products
   
$
1,440
 
     
$
1,425
 
AJOVY
   
 
63
 
     
 
45
 
COPAXONE
   
 
38
 
     
 
50
 
Other*
   
 
261
 
     
 
229
 
  
 
 
       
 
 
  
Total
   
$
1,802
 
     
$
1,750
 
  
 
 
       
 
 
  

*
Other
 revenues in the first nine months of 2024 include the sale of certain product rights.