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Certain transactions | 3 Months Ended
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Mar. 31, 2025
Certain transactions | NOTE 2 – Certain transactions: The Company has entered into alliances and other arrangements with third parties to acquire rights to products it does not have, to access markets it does not operate in and to otherwise share development costs or business risks. The Company’s most significant agreements of this nature are summarized below. mAbxience In April 2024, Teva announced it entered into a strategic licensing agreement with mAbxience for a biosimilar candidate currently in development for the treatment of multiple oncology indications. Under the terms of the licensing agreement, mAbxience will develop and produce the biosimilar product and Teva will lead the regulatory processes and commercialization in multiple global markets, including Europe and the U.S. In September 2024, Teva and mAbxience entered into an amendment to the licensing agreement whereby, similar to the initial licensing agreement, mAbxience will lead the development and production of an anti-PD-1 oncology biosimilar candidate and Teva will manage regulatory approvals and oversee commercialization in the designated markets. Under the initial agreement, Teva paid mAbxience an aggregate of $20 million in upfront and milestone payments in 2024, which were recorded as R&D expenses. Pursuant to the amendment of the licensing agreement, in the fourth quarter of 2024, Teva paid mAbxience further upfront and milestone payments in a total amount of $15 million, which were recorded as R&D expenses. mAbxience may be eligible for additional future development, regulatory and commercial milestone payments, in an aggregate amount of up to $320 million. Launch Therapeutics and Abingworth On March 28, 2024, Teva and Launch Therapeutics, Inc. (“Launch Therapeutics”) entered into a clinical collaboration agreement to further accelerate the clinical research program of Teva’s Dual-Action Asthma Rescue Inhaler (“DARI”) (ICS-SABA; TEV-‘248). As part of this clinical collaboration agreement Teva also entered into a development funding agreement with funds affiliated with Abingworth LLP (“Abingworth”). Under the clinical collaboration agreement, Launch Therapeutics, a clinical development company backed by Abingworth and Carlyle, the global investment firm, will have the lead role in the operational execution and management of the planned clinical trials. Teva will retain primary responsibility for manufacturing, regulatory interactions in the U.S., and commercialization. DARI (ICS-SABA ) is currently in Phase 3 for the treatment of asthma symptoms addressing both immediate symptoms and long-term inflammation. Under the development funding agreement, Abingworth will provide Teva up to $150 million to fund ongoing development costs for DARI (ICS-SABA ). In exchange and subject to regulatory approval, Teva will pay Abingworth a milestone payment in the amount actually funded by Abingworth up to $150 million, as well as success payments based on DARI (ICS-SABA ) sales. During the first quarter of 2025 and during 2024, Teva recorded $30 million and $42 million, respectively, as reimbursement for R&D expenses incurred in connection with this agreement. Biolojic Design On November 26, 2023, Teva entered into a license agreement with Biolojic Design Ltd. (“Biolojic”), pursuant to which Teva received exclusive rights to develop, manufacture and globally commercialize a BD9 multibody for the potential treatment of atopic dermatitis and asthma. In exchange, Teva paid an upfront payment in an amount of $10 million in January 2024, which was recorded as an R&D expense in the fourth quarter of 2023. In the first quarter of 2025, Teva recognized a milestone payment in an amount of $5 million as R&D expenses, which will be paid during the second quarter of 2025. Biolojic may be eligible to receive additional development and commercial milestone payments of up to approximately $500 million, over the next several years, based on the achievement of certain pre-clinical, clinical and regulatory milestones, with the majority of the payments based on future sales achievements. Royalty Pharma On November 9, 2023, Teva entered into a funding agreement with Royalty Pharma plc. (“Royalty Pharma”) to further accelerate the clinical research program for Teva’s olanzapine LAI (TEV-’749). Under the terms of the funding agreement, Royalty Pharma will provide Teva up to $100 million to fund ongoing development costs for olanzapine LAI (TEV-‘749). In exchange and subject to regulatory approval, Teva will pay Royalty Pharma a milestone payment in the amount actually funded by Royalty Pharma, paid over 5 years, in addition to royalties upon commercialization. Teva will continue to lead the development and commercialization of the product globally. During 2023 and 2024, Teva recorded $100 million as reimbursement for R&D expenses incurred in connection with this agreement, which collectively amounted to the total funding Royalty Pharma was to provide Teva. Olanzapine LAI (TEV-’749) is currently in Phase 3 for the treatment of schizophrenia (see also MedinCell transaction below). Sanofi On October 3, 2023, Teva entered into an exclusive collaboration with Sanofi to co-develop and co-commercialize Teva’s duvakitug (anti-TL1A, TEV-’574) asset, a novel anti-TL1A therapy for the treatment of ulcerative colitis and Crohn’s disease, two types of inflammatory bowel disease. Under the terms of the collaboration agreement, in partial consideration of the licenses granted to Sanofi, Teva received an upfront payment of $500 million in the fourth quarter of 2023, which was recognized as revenue. Additionally, Teva may receive up to $1 billion in development and launch milestones. Each company will equally share the remaining development costs globally and net profits and losses in major markets, with other markets subject to a royalty arrangement, and Sanofi will lead the development of the Phase 3 program. Teva will lead commercialization of the product in Europe, Israel and specified other countries, and Sanofi will lead commercialization in North America, Japan, other parts of Asia and the rest of the world. On December 17, 2024, Teva and Sanofi announced that the Phase 2b study for duvakitug met its primary endpoints in patients with ulcerative colitis and Crohn’s disease. Sanofi and Teva plan to initiate Phase 3 development in inflammatory bowel disease in the second half of 2025, pending regulatory discussions. MODAG In October 2021, Teva announced a license agreement with MODAG GmbH (“Modag”) providing Teva with an exclusive global license to develop, manufacture and commercialize Modag’s lead compound, emrusolmin (TEV-’286) and a related compound (TEV-’287). Teva made an upfront payment of $10 million to Modag in the fourth quarter of 2021, recorded as an R&D expense. Emrusolmin (TEV-’286) was developed for the treatment of Multiple System Atrophy (“MSA”) and Parkinson’s disease. In the third quarter of 2024, Teva initiated a Phase 2 clinical trial for Emrusolmin (TEV-’286). TEV-‘287 is being developed for Parkinson’s disease. In the second quarter of 2025 Teva initiated a Phase 1 clinical trial for TEV-‘287, and in connection with that trial, recorded a $10 million milestone payment to Modag as an R&D expense, which is expected to be paid in the third quarter of 2025. Modag may be eligible for additional future development milestone payments, in an aggregate amount of up to $20 million, as well as future commercial milestones and royalties. Alvotech In August 2020, Teva entered into an agreement with biopharmaceutical company Alvotech for the exclusive commercialization in the U.S. of five biosimilar product candidates. The initial pipeline for this collaboration contained biosimilar candidates addressing multiple therapeutic areas, including proposed biosimilars to Humira ® (adalimumab) and Stelara ® (ustekinumab). Under the terms of the agreement, Alvotech is responsible for the development, registration and supply of the biosimilar product candidates and Teva will exclusively commercialize the products in the U.S. In July 2023, Alvotech and Teva amended their collaboration agreement, adding two new biosimilar candidates as well as line extensions of two current biosimilar candidates to their partnership. Teva made upfront and milestone payments in an aggregate amount of $124 million between the years 2020 and 2024. Teva made an additional milestone payment of $5 million in the first quarter of 2025, which was recognized as R&D expenses in the fourth quarter of 2024. Additional development and commercial milestone payments of up to approximately $375 million, in addition to royalty and milestone payments related to the amendment of the collaboration agreement entered into in July 2023, may be payable by Teva over the next few years. Teva and Alvotech will share revenue from the commercialization of these biosimilars. The amendment of the collaboration agreement entered into in July 2023 includes increased involvement by Teva regarding manufacturing and quality at Alvotech’s manufacturing facility. Additionally, pursuant to another amendment to the collaboration agreement entered into on September 29, 2023, Teva purchased $40 million of subordinated convertible bonds of Alvotech. Alvotech redeemed the convertible bonds for $44 million, including accrued interest, which was paid to Teva in July 2024. On February 24, 2024, Alvotech and Teva announced that the FDA approved SIMLANDI ® (adalimumab-ryvk) injection, as an interchangeable biosimilar to Humira ® , for the treatment of adult rheumatoid arthritis, juvenile idiopathic arthritis, adult psoriatic arthritis, adult ankylosing spondylitis, Crohn’s disease, adult ulcerative colitis, adult plaque psoriasis, adult hidradenitis suppurativa and adult uveitis. On April 17, 2024, Alvotech and Teva amended their collaboration agreement to enable the purchase by Quallent of a private label adalimumab-ryvk injection from Alvotech for the U.S. market, with Alvotech sharing profits with Teva on the private label sales. On May 20, 2024, Alvotech and Teva announced that SIMLANDI is available in the United States. On April 16, 2024, Alvotech and Teva announced that the FDA approved SELARSDI TM (ustekinumab-aekn) injection for subcutaneous use, as a biosimilar to Stelara ® , for the treatment of moderate to severe plaque psoriasis and for active psoriatic arthritis in adults and pediatric patients six years and older, and on October 22, 2024, announced that the FDA approved SELARSDI in a new presentation, 130 mg/26 mL (5 mg/mL) solution in a single-dose vial for intravenous infusion, expanding its label to include treatment of adults with Crohn’s disease and ulcerative colitis. On February 21, 2025, Alvotech and Teva announced that SELARSDI is available in the United States. On May 5, 2025, Teva and Alvotech announced that the FDA has approved SELARSDI (ustekinumab-aekn) injection as interchangeable with the reference biologic Stelara ® (ustekinumab) in all presentations matching the reference product, effective as of April 30, 2025. In January 2025, Teva and Alvotech announced that the FDA had accepted for review Biologic License Applications (“BLA”) for Alvotech’s proposed biosimilars to Simponi ® and Simponi Aria ® (golimumab). In February 2025, Teva and Alvotech announced that the FDA had accepted for review a BLA for Alvotech’s proposed biosimilar to Eylea ® (aflibercept). Takeda In December 2016, Teva entered into a license agreement with a subsidiary of Takeda Pharmaceutical Company Ltd. (“Takeda”), for the research, development, manufacture and commercialization of ATTENUKINE TM technology. Teva received a $30 million upfront payment and a milestone payment of $20 million in 2017. During the second quarter of 2022, Takeda initiated its Phase 2 study of modakafusp alfa (formerly TAK-573 or TEV ’573) and as a result paid Teva a milestone payment of $25 million, which was recognized as revenue in the second quarter of 2022. In April 2024, Takeda informed Teva of its intent to terminate the agreement with respect to such product candidate, and its product rights were reverted back to Teva in the first quarter of 2025. In December 2024, Takeda informed Teva of its intent to terminate the license agreement in its entirety, and all rights to the ATTENUKINE TM technology will revert back to Teva in the first half of 2025. MedinCell In November 2013, Teva entered into an agreement with MedinCell for the development and commercialization of multiple long-acting injectable (“LAI”) products. Teva leads the clinical development and regulatory process and is responsible for the commercialization of these products. The lead product is risperidone LAI (formerly known as TV-46000). On April 28, 2023, the FDA approved UZEDY ® (risperidone) extended-release injectable suspension for the treatment of schizophrenia in adults, which was launched in the U.S. in May 2023. On February 25, 2025, Teva and MedinCell announced that the supplemental New Drug Application (sNDA) for UZEDY extended-release injectable suspension for the maintenance treatment of the Bipolar I disorder in adults has been accepted for filing by the FDA. MedinCell may be eligible for future sales-based milestones of up to $105 million with respect to UZEDY. Teva also pays MedinCell royalties on net sales. The second selected product candidate is olanzapine LAI (TEV-’749) for the treatment of schizophrenia. In the third quarter of 2022, Teva decided to progress development of the product to Phase 3 and, as a result, paid a $3 million milestone payment to MedinCell, which was recognized as R&D expenses. On May 8, 2024, Teva and MedinCell announced positive Phase 3 efficacy results from a trial evaluating olanzapine LAI as a once-monthly subcutaneous long-acting injectable in adults with schizophrenia and on March 31, 2025, Teva announced survey results demonstrating patient and healthcare satisfaction with olanzapine LAI. Additional safety and efficacy results are planned in the first half of 2025. Teva paid a further $5 million milestone payment to MedinCell in the first quarter of 2025, which was recognized as R&D expenses. MedinCell may become eligible for further development and commercial milestones of up to $112 million, as well as royalties on sales of olanzapine LAI (TEV-’749). Assets and Liabilities Held for Sale: General Assets and liabilities held for sale as of March 31, 2025, mainly included Teva’s API business. Assets held for sale as of December 31, 2024 included mainly Teva’s API business and Teva’s business venture in Japan. On December 31, 2024, Teva classified its API business (including its R&D, manufacturing and commercial activities) as held for sale. 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 whether a divestiture will be agreed or completed at all. In connection with the held for sale classification of Teva’s API business, in the first quarter of 2025, Teva recorded a favorable adjustment of $46 million in other assets impairments, restructuring and other items. See note 12. On March 31, 2025, Teva divested its business venture in Japan, pursuant to which, in the first quarter of 2025, Teva recorded a marginal gain. Teva has elected the policy to include the currency translation adjustment related to the disposal group as part of the asset carrying amount. The table below summarizes all of Teva’s assets and liabilities included as held for sale as of March 31, 2025 and December 31, 2024:
|  | March 31, |  |  | December 31, |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions) |
Accounts receivables |  | $ | 73 |  |  | $ | 222 |
Inventories |  |  | 502 |  |  |  | 647 |
Property, plant and equipment, net and others |  |  | 930 |  |  |  | 913 |
Identifiable intangible assets, net |  |  | 22 |  |  |  | 83 |
Goodwill |  |  | 207 |  |  |  | 255 |
Other current assets |  |  | 107 |  |  |  | 99 |
Other non-current assets |  |  | 201 |  |  |  | 236 |
Expected loss on sale* |  |  | (228 | ) |  |  | (684 | )
Total assets of the disposal group classified as held for sale in the consolidated balance sheets |  | $ | 1,814 |  |  | $ | 1,771 |
Accounts payables |  |  | (243 | ) |  |  | (283 | )
Other current liabilities |  |  | (40 | ) |  |  | (49 | )
Other non-current liabilities |  |  | (75 | ) |  |  | (85 | )
Expected loss on sale* |  |  | — |  |  |  | (281 | )
Total liabilities of the disposal group classified as held for sale in the consolidated balance sheets |  | $ | (358 | ) |  | $ | (698 | )
* | Includes an expected loss from reclassification of currency translation adjustments to the consolidated statements of income (loss) upon sale.

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- Definition This element may be used for the entire related party transactions disclosure as a single block of text. Disclosure may include: business acquisitions, agreements with related parties, significant cooperation agreements, the nature of the relationship(s), a description of the transactions, the amount of the transactions, the effects of any change in the method of establishing the terms of the transaction from the previous period, stated interest rate, expiration date, terms and manner of settlement per the agreement with the related party, and amounts due to or from related parties. If the entity and one or more other entities are under common ownership or management control and this control affects the operating results or financial position, disclosure includes the nature of the control relationship even if there are no transactions between the entities. Disclosure may also include the aggregate amount of current and deferred tax expense for each statement of earnings presented where the entity is a member of a group that files a consolidated tax return, the amount of any tax related balances due to or from affiliates as of the date of each statement of financial position presented, the principal provisions of the method by which the consolidated amount of current and deferred tax expense is allocated to the members of the group and the nature and effect of any changes in that method. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates. + References No definition available. + Details
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