##### Table of Contents

false Q3 0000818686--12-31 00-0000000 IL Contingent consideration represents liabilities recorded at fair value in connection with acquisitions.The fair value was estimated based on quoted market prices.Cumulative goodwill impairment as of September 30, 2025 and December 31, 2024, was each approximately $29.6 billion.In January 2025, Teva repaid $426 million of its 6.00% senior notes due 2025 at maturity.In January 2025, Teva repaid $427 million of its 7.13% senior notes due 2025 at maturity.In March 2025, Teva repaid $515 million of its 4.50% senior notes due 2025 at maturity.In July 2025, Teva repaid $444 million of its 1% senior notes due 2025 at maturity.In May 2025, Teva issued senior notes in an aggregate principal amount of $700 million bearing 5.75% annual interest and due December 2030.In May 2025, Teva issued senior notes in an aggregate principal amount of €1,000 million bearing 4.125% annual interest and due June 2031.In May 2025, Teva issued senior notes in an aggregate principal amount of $500 million bearing 6.00% annual interest and due December 2032.In June 2025, Teva consummated a cash tender offer and extinguished $1,579 million aggregate principal amount of its 3.15% senior notes due 2026; $351 million aggregate principal amount of its 4.75% senior notes due 2027; $202 million aggregate principal amount of its 7.88% senior notes due in 2029; and $157 million aggregate principal amount of its 7.38% senior notes due in 2029. The extinguishment resulted in a loss of $10 million which was recorded under financial expenses, net.If Teva fails to achieve certain sustainability performance targets, a one-time premium payment of 0.15%-0.45% out of the principal amount will be paid at maturity or upon earlier redemption, if such redemption is on or after May 9, 2026.Interest rate adjustments and a potential one-time premium payment related to the sustainability-linked bonds are treated as bifurcated embedded derivatives. See note 8c.If Teva fails to achieve certain sustainability performance targets, the interest rate shall increase by 0.125%-0.375% per annum, from and including May 9, 2026.If Teva fails to achieve certain sustainability performance targets, the interest rate shall increase by 0.100%-0.300% per annum, from and including September 15, 2026.Debt issuance costs as of September 30, 2025 include $20 million in connection with the issuance of the senior notes in May 2025, partially offset by $6 million acceleration of issuance costs related to the cash tender offer.Amounts do not include a $27 million gain from foreign currency translation adjustments attributable to redeemable and non-redeemable non-controlling interests.Amounts do not include a $6 million loss from foreign currency translation adjustments attributable to non-controlling interests.Including impairments related to exit and disposal activities.Includes adjustments for foreign currency translation.Other revenues in the first nine months of 2025 and 2024 include the sale of certain product rights.Other revenues in the third quarter of 2025 and 2024 include the sale of certain product rights.Teva uses foreign exchange contracts (mainly option and forward contracts) to hedge balance sheet items from currency exposure. These foreign exchange contracts are not designated as hedging instruments for accounting purposes. In connection with these foreign exchange contracts, Teva recognizes gains or losses that offset the revaluation of the balance sheet items also recorded under financial expenses, net.Teva entered into option and forward contracts designed to limit the exposure of foreign exchange fluctuations on projected revenues and expenses recorded in euro, Swiss franc, British pound, Russian ruble, Canadian dollar, Polish złoty, new Israeli shekel, Indian rupee and some other currencies to protect its projected operating results for 2025 and 2026. These derivative instruments do not meet the criteria for hedge accounting, however, they are accounted for as an economic hedge. These derivative instruments, which may include hedging transactions of future projected revenues and expenses, are recognized on the balance sheet at their fair value on a quarterly basis, while the foreign exchange impact on the underlying revenues and expenses may occur in subsequent quarters. In the three months ended September 30, 2025, the positive impact from these derivatives recognized under revenues was $9 million. In the three months ended September 30, 2024, the negative impact from these derivatives recognized under revenues was $9 million. In the nine months ended September 30, 2025, the negative impact from these derivatives recognized under revenues was $51 million. In the nine months ended September 30, 2024, the positive impact from these derivatives recognized under revenues was $1 million. Changes in the fair value of the derivative instruments are recognized in the same line item in the statements of income as the underlying exposure being hedged. Cash flows associated with these derivatives are reflected as cash flows from operating activities in the consolidated statements of cash flows.Adjustment in the nine-month period ended September 30, 2024 was mainly related to an agreement with the Israeli Tax Authorities. See note 11.Includes an expected loss from reclassification of currency translation adjustments to the consolidated statements of income (loss) upon sale.In May 2025, Teva entered into a $500 million notional amount of fixed to fixed cross-currency interest rate swaps relating to its 5.75% senior notes due 2030 to hedge the foreign currency exchange risk of future principal and interest payments associated with the USD denominated notes. The cross-currency swaps synthetically convert part of the USD debt into CHF, aligning debt servicing costs with Teva’s inflows and reducing economic volatility. These swaps have been designated as cash flow hedges and the gain or loss on these swaps will be reported as a component of other comprehensive income and reclassified into earnings in each period during which the swaps affect earnings in the same line item associated with the USD denominated bonds.Purchase of shares from non-controlling interests in a Teva’s subsidiary in Switzerland.In connection with the sale of Teva’s business venture in Japan.In connection with the sale of Teva’s business venture in Japan. 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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
10-Q

☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2025
OR

☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number
001-16174
TEVA PHARMACEUTICAL INDUSTRIES LIMITED
(Exact name of registrant as specified in its charter)

Israel |  | Not Applicable
(State or other jurisdiction of incorporation or organization) |  | (IRS Employer Identification Number)
124 Dvora HaNevi’a St., Tel Aviv, ISRAEL |  | 6944020
(Address of principal executive offices) |  | (Zip code)

+972
(3)
914-8213
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:

Title of each class |  | Trading Symbol(s) |  | Name of each exchange on which registered
American Depositary Shares, each representing one Ordinary Share |  | TEVA |  | New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.Yes☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation
S-T
(§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).Yes☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated
filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule
12b-2
of the Exchange Act.

Large accelerated filer |  | ☒ |  | Accelerated filer |  | ☐
Non-accelerated filer |  | ☐ |  | Smaller reporting company |  | ☐
Emerging growth company |  | ☐ |  |  |  |

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule
12b-2
of the Act). Yes ☐ No☒
As of September 30, 2025, the registrant had 1,147,282,512 ordinary shares outstanding.

##### Table of Contents

TEVA PHARMACEUTICAL INDUSTRIES LIMITED

For an accessible version of this Quarterly Report on Form 10-Q, please visit www.tevapharm.com

PART I. |  | Financial Statements (unaudited) |  |  | 5 |
Item 1. |  | Financial Statements (unaudited) |  |  | 5 |
|  | Consolidated Balance Sheets |  |  | 5 |
|  | Consolidated Statements of Income (loss) |  |  | 6 |
|  | Consolidated Statements of Comprehensive Income (loss) |  |  | 7 |
|  | Consolidated statements of changes in equity |  |  | 8 |
|  | Consolidated Statements of Cash Flows |  |  | 10 |
|  | Notes to Consolidated Financial Statements |  |  | 11 |
Item 2. |  | Management’s Discussion and Analysis of Financial Condition and Results of Operations |  |  | 56 |
Item 3. |  | Quantitative and Qualitative Disclosures about Market Risk |  |  | 83 |
Item 4. |  | Controls and Procedures |  |  | 83 |
PART II. |  | OTHER INFORMATION |  |  | 84 |
Item 1. |  | Legal Proceedings |  |  | 84 |
Item 1A. |  | Risk Factors |  |  | 84 |
Item 2. |  | Unregistered Sales of Equity Securities and Use of Proceeds |  |  | 84 |
Item 3. |  | Defaults Upon Senior Securities |  |  | 84 |
Item 4. |  | Mine Safety Disclosures |  |  | 84 |
Item 5. |  | Other Information |  |  | 84 |
Item 6. |  | Exhibits |  |  | 85 |
|  | Signatures |  |  | 86 |

2

##### Table of Contents

http://fasb.org/us-gaap/2025#IncomeLossFromContinuingOperationsBeforeIncomeTaxesMinorityInterestAndIncomeLossFromEquityMethodInvestments 2026-04-30 http://fasb.org/us-gaap/2025#Liabilities http://fasb.org/us-gaap/2025#Liabilities http://www.tevapharm.com/20250930#ImpairmentsRestructuringAndOthers http://www.tevapharm.com/20250930#ImpairmentsRestructuringAndOthers
TEVA PHARMACEUTICAL INDUSTRIES LIMITED
INTRODUCTION AND USE OF CERTAIN TERMS
Unless otherwise indicated, all references to the “Company,” “we,” “our” and “Teva” refer to Teva Pharmaceutical Industries Limited and its subsidiaries, and references to “revenues” refer to net revenues. References to “U.S. dollars,” “dollars,” “U.S. $” and “$” are to the lawful currency of the United States of America, and references to “NIS” are to new Israeli shekels. References to “ADS(s)” are to Teva’s American Depositary Share(s). Market data, including both sales and share data, is based on information provided by IQVIA, a provider of market research to the pharmaceutical industry (“IQVIA”), unless otherwise stated. References to “R&D” are to Research and Development, references to “IPR&D” are to
in-process
R&D, references to “S&M” are to Selling and Marketing and references to “G&A” are to General and Administrative. Some amounts in this report may not add up due to rounding. All percentages have been calculated using unrounded amounts. This report on Form
10-Q
contains many of the trademarks and trade names used by Teva in the United States and internationally to distinguish its products and services. Any third-party trademarks mentioned in this report are the property of their respective owners.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
In addition to historical information, this Quarterly Report on Form
10-Q,
and the reports and documents incorporated by reference in this Quarterly Report on Form
10-Q,
may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which are based on management’s current beliefs and expectations and are subject to substantial risks and uncertainties, both known and unknown, that could cause our future results, performance or achievements to differ significantly from that expressed or implied by such forward-looking statements. These forward-looking statements include statements concerning our plans, strategies, objectives, future performance and financial and operating targets, and any other information that is not historical information. You can identify these forward-looking statements by the use of words such as “should,” “expect,” “anticipate,” “estimate,” “target,” “may,” “project,” “guidance,” “intend,” “plan,” “believe” and other words and terms of similar meaning and expression in connection with any discussion of future operating or financial performance. Important factors that could cause or contribute to such differences include risks relating to:

| • |  | our ability to successfully compete in the marketplace, including: that we are substantially dependent on our generic products; concentration of our customer base and commercial alliances among our customers; competition faced by our generic medicines from other pharmaceutical companies and changes in regulatory policy that may result in additional costs and delays; delays in launches of new generic products; our ability to develop and commercialize additional pharmaceutical products; competition for our innovative medicines; our ability to achieve expected results from investments in our product pipeline; our ability to successfully execute our Pivot to Growth strategy, including to expand our innovative and biosimilar medicines pipeline and profitably commercialize the innovative medicines and biosimilar portfolio, whether organically or through business development, to sustain and focus our portfolio of generic medicines, and to execute on our organizational transformation and to achieve expected cost savings; and the effectiveness of our patents and other measures to protect our intellectual property rights, including any potential challenges to our Orange Book patent listings in the U.S.;

| • |  | our significant indebtedness, which may limit our ability to incur additional indebtedness, engage in additional transactions or make new investments; and our potential need to raise additional funds in the future, which may not be available on acceptable terms or at all;

| • |  | our business and operations in general, including: the impact of global economic conditions and other macroeconomic developments and the governmental and societal responses thereto; the widespread outbreak of an illness or any other communicable disease, or any other public health crisis; effectiveness of our optimization efforts; significant disruptions of information technology systems, including cybersecurity attacks and breaches of our data security; interruptions in our supply chain or problems with internal or third party manufacturing; any impact of a prolonged government shutdown; challenges associated with conducting business globally, including political or economic instability, major hostilities or terrorism, such as the ongoing conflict between Russia and Ukraine and in the Middle East; our ability to attract, hire, integrate and retain highly skilled personnel; our ability to successfully bid for suitable acquisition targets or licensing opportunities, or to consummate and integrate acquisitions; and our prospects and opportunities for growth if we sell assets or business units and close or divest plants and facilities, as well as our ability to successfully and cost-effectively consummate such sales and divestitures, including our planned divestiture of our API business;

3

Table of Contents
TEVA PHARMACEUTICAL INDUSTRIES LIMITED

| • |  | compliance, regulatory and litigation matters, including: failure to comply with complex legal and regulatory requirements and changes; the effects of governmental, regulatory and civil proceedings and litigation which we are, or in the future become, party to; the effects of reforms in healthcare regulation and reductions in pharmaceutical pricing, reimbursement and coverage, including as a result of the One Big Beautiful Bill signed into law in the U.S. in July 2025 (“OBBBA”), which is expected to result in stricter Medicaid eligibility requirements and work requirements, which may result in reduced Medicaid enrollment and a resulting decline in coverage for purchases of our medicines, and U.S. Executive Orders issued in April and May 2025 intended to reduce the prices paid by Americans for prescription medicines, including most-favored-nation pricing; increased legal and regulatory action in connection with public concern over the abuse of opioid medications; our ability to timely make payments required under our nationwide opioids settlement agreement and provide our generic version of Narcan ® (naloxone hydrochloride nasal spray) in the amounts and at the times required under the terms of such agreement; scrutiny from competition and pricing authorities around the world, including our ability to comply with and operate under our deferred prosecution agreement (“DPA”) with the U.S. Department of Justice (“DOJ”); potential liability for intellectual property right infringement; product liability claims; claims brought by regulatory agencies; failure to comply with complex Medicare, Medicaid and other governmental programs reporting and payment obligations; compliance with sanctions and trade control laws; environmental risks; and the impact of sustainability issues;

| • |  | other financial and economic risks, including: our exposure to currency fluctuations and restrictions as well as credit risks; potential impairments of our long-lived assets; the impact of geopolitical conflicts and developments, including in the Middle East and in Russia and Ukraine; potential significant increases in tax liabilities; the effect on our overall effective tax rate of the termination or expiration of governmental programs or tax benefits, or of a change in our business; our exposure to changes in international trade policies, including the imposition of tariffs in the jurisdictions in which we operate, and the effects of such developments on sales of our products and the pricing and availability of our raw materials; and the impact of any future failure to establish and maintain effective internal control over our financial reporting;

and other factors discussed in this Quarterly Report on Form
10-Q
and in our Annual Report on Form
10-K
for the year ended December 31, 2024, including in the sections captioned “Risk Factors” and “Forward-looking Statements.” Forward-looking statements speak only as of the date on which they are made, and we assume no obligation to update or revise any forward-looking statements or other information contained herein, whether as a result of new information, future events or otherwise. You are cautioned not to put undue reliance on these forward-looking statements.
4

Table of Contents
PART I — FINANCIAL INFORMATION

ITEM 1. | FINANCIAL STATEMENTS

TEVA PHARMACEUTICAL INDUSTRIES LIMITED
CONSOLIDATED BALANCE SHEETS
(U.S. dollars in millions, except for share data)
(Unaudited)

|  | September 30, 2025 |  |  | December 31, 2024 |
ASSETS |  |  |  |  |  |  |  |
Current assets: |  |  |  |  |  |  |  |
Cash and cash equivalents |  | $ | 2,203 |  |  | $ | 3,300 |
Accounts receivables, net of allowance for credit losses of $82 million and $78 million as of September 30, 2025 and December 31, 2024, respectively |  |  | 3,810 |  |  |  | 3,059 |
Inventories |  |  | 3,323 |  |  |  | 3,007 |
Prepaid expenses |  |  | 1,115 |  |  |  | 1,006 |
Other current assets |  |  | 477 |  |  |  | 409 |
Assets held for sale |  |  | 1,809 |  |  |  | 1,771 |
Total current assets |  |  | 12,736 |  |  |  | 12,552 |
Deferred income taxes |  |  | 1,634 |  |  |  | 1,799 |
Other non-current assets |  |  | 444 |  |  |  | 462 |
Property, plant and equipment, net |  |  | 4,820 |  |  |  | 4,581 |
Operating lease right-of-use assets, net |  |  | 342 |  |  |  | 367 |
Identifiable intangible assets, net |  |  | 3,936 |  |  |  | 4,418 |
Goodwill |  |  | 15,945 |  |  |  | 15,147 |
Total assets |  | $ | 39,856 |  |  | $ | 39,326 |
LIABILITIES AND EQUITY |  |  |  |  |  |  |  |
Current liabilities: |  |  |  |  |  |  |  |
Short-term debt |  | $ | 24 |  |  | $ | 1,781 |
Sales reserves and allowances |  |  | 4,134 |  |  |  | 3,678 |
Accounts payables |  |  | 2,355 |  |  |  | 2,203 |
Employee-related obligations |  |  | 561 |  |  |  | 624 |
Accrued expenses |  |  | 2,989 |  |  |  | 2,792 |
Other current liabilities |  |  | 1,103 |  |  |  | 1,020 |
Liabilities held for sale |  |  | 324 |  |  |  | 698 |
Total current liabilities |  |  | 11,491 |  |  |  | 12,796 |
Long-term liabilities: |  |  |  |  |  |  |  |
Deferred income taxes |  |  | 399 |  |  |  | 483 |
Other taxes and long-term liabilities |  |  | 3,664 |  |  |  | 4,028 |
Senior notes and loans |  |  | 16,766 |  |  |  | 16,002 |
Operating lease liabilities |  |  | 283 |  |  |  | 296 |
Total long-term liabilities |  |  | 21,111 |  |  |  | 20,809 |
Commitments and contingencies , see note 10 |  |  |  |  |  |  |  |
Total liabilities |  |  | 32,602 |  |  |  | 33,606 |
Redeemable non-controlling interests |  |  | — |  |  |  | 340 |
Equity: |  |  |  |  |  |  |  |
Teva shareholders’ equity: |  |  |  |  |  |  |  |
Ordinary shares of NIS 0.10 par value per share; September 30, 2025 and December 31, 2024: authorized 2,495 million shares; issued 1,253 million shares and 1,240 million shares, respectively |  |  | 58 |  |  |  | 58 |
Additional paid-in capital |  |  | 28,038 |  |  |  | 27,764 |
Accumulated deficit |  |  | (14,243 | ) |  |  | (15,173 | )
Accumulated other comprehensive loss |  |  | (2,475 | ) |  |  | (3,148 | )
Treasury shares as of September 30, 2025 and December 31, 2024: 106 million and 107 million ordinary shares, respectively |  |  | (4,128 | ) |  |  | (4,128 | )
|  |  | 7,250 |  |  |  | 5,373 |
Non-controlling interests |  |  | 4 |  |  |  | 7 |
Total equity |  |  | 7,254 |  |  |  | 5,380 |
Total liabilities, redeemable non-controlling interests and equity |  | $ | 39,856 |  |  | $ | 39,326 |

Amounts may not add up due to rounding.
The accompanying notes are an integral part of the financial statements.
5

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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(U.S. dollars in millions, except share and per share data)
(Unaudited)

|  | Three months ended |  |  | Nine months ended |
|  | September 30, |  |  | September 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
Net revenues |  | $ | 4,480 |  |  | $ | 4,332 |  |  | $ | 12,547 |  |  | $ | 12,315 |
Cost of sales |  |  | 2,176 |  |  |  | 2,183 |  |  |  | 6,264 |  |  |  | 6,372 |
Gross profit |  |  | 2,304 |  |  |  | 2,148 |  |  |  | 6,282 |  |  |  | 5,943 |
Research and development expenses |  |  | 256 |  |  |  | 240 |  |  |  | 746 |  |  |  | 751 |
Selling and marketing expenses |  |  | 656 |  |  |  | 626 |  |  |  | 1,933 |  |  |  | 1,891 |
General and administrative expenses |  |  | 317 |  |  |  | 298 |  |  |  | 920 |  |  |  | 859 |
Intangible assets impairments |  |  | 64 |  |  |  | 28 |  |  |  | 227 |  |  |  | 169 |
Goodwill impairment |  |  | — |  |  |  | 600 |  |  |  | — |  |  |  | 1,000 |
Other assets impairments, restructuring and other items |  |  | 62 |  |  |  | (23 | ) |  |  | 272 |  |  |  | 931 |
Legal settlements and loss contingencies |  |  | 60 |  |  |  | 450 |  |  |  | 312 |  |  |  | 638 |
Other loss (income) |  |  | 7 |  |  |  | (21 | ) |  |  | 15 |  |  |  | (22 | )
Operating income (loss) |  |  | 882 |  |  |  | (51 | ) |  |  | 1,857 |  |  |  | (274 | )
Financial expenses, net |  |  | 237 |  |  |  | 272 |  |  |  | 714 |  |  |  | 763 |
Income (loss) before income taxes |  |  | 646 |  |  |  | (324 | ) |  |  | 1,143 |  |  |  | (1,037 | )
Income taxes (benefit) |  |  | 214 |  |  |  | 69 |  |  |  | 210 |  |  |  | 648 |
Share in (profits) losses of associated companies, net |  |  | (2 | ) |  |  | (3 | ) |  |  | (4 | ) |  |  | (1 | )
Net income (loss) |  |  | 434 |  |  |  | (390 | ) |  |  | 937 |  |  |  | (1,684 | )
Net income (loss) attributable to redeemable and non-redeemable non-controlling interests |  |  | 1 |  |  |  | 47 |  |  |  | 7 |  |  |  | (262 | )
Net income (loss) attributable to Teva |  |  | 433 |  |  |  | (437 | ) |  |  | 930 |  |  |  | (1,422 | )
Earnings (loss) per share attributable to ordinary shareholders: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Basic |  | $ | 0.38 |  |  | $ | (0.39 | ) |  | $ | 0.81 |  |  | $ | (1.26 | )
Diluted |  | $ | 0.37 |  |  | $ | (0.39 | ) |  | $ | 0.80 |  |  | $ | (1.26 | )
Weighted average number of shares (in millions): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Basic |  |  | 1,147 |  |  |  | 1,133 |  |  |  | 1,144 |  |  |  | 1,130 |
Diluted |  |  | 1,164 |  |  |  | 1,133 |  |  |  | 1,160 |  |  |  | 1,130 |

Amounts may not add up due to rounding.
The accompanying notes are an integral part of the financial statements.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(U.S. dollars in millions)
(Unaudited)

|  | Three months ended |  |  | Nine months ended |
|  | September 30, |  |  | September 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
Net income (loss) |  | $ | 434 |  |  | $ | (390 | ) |  | $ | 937 |  |  | $ | (1,684 | )
Other comprehensive income (loss), net of tax: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Currency translation adjustment |  |  | (50 | ) |  |  | 174 |  |  |  | 672 |  |  |  | (94 | )
Unrealized gain (loss) from derivative financial instruments, net |  |  | 6 |  |  |  | 7 |  |  |  | 30 |  |  |  | 21 |
Unrealized loss on defined benefit plans |  |  | * |  |  |  | (1 | ) |  |  | (2 | ) |  |  | (2 | )
Total other comprehensive income (loss) |  |  | (44 | ) |  |  | 180 |  |  |  | 700 |  |  |  | (75 | )
Total comprehensive income (loss) |  |  | 390 |  |  |  | (210 | ) |  |  | 1,637 |  |  |  | (1,759 | )
Comprehensive income (loss) attributable to redeemable and non-redeemable non-controlling interests |  |  | 1 |  |  |  | 114 |  |  |  | 34 |  |  |  | (268 | )
Comprehensive income (loss) attributable to Teva |  | $ | 389 |  |  | $ | (324 | ) |  | $ | 1,603 |  |  | $ | (1,491 | )

* | Represents an amount less than $0.5 million.

Amounts may not add up due to rounding.
The accompanying notes are an integral part of the financial statements.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

|  | Teva shareholders’ equity |  |  |  |  |  |  |
|  | Ordinary shares |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Number of shares (in millions) |  |  | Stated value |  |  | Additional paid-in capital |  |  | Retained earnings (accumulated deficit) |  |  | Accumulated other comprehensive (loss) |  |  | Treasury shares |  |  | Total Teva shareholders’ equity |  |  | Non-controlling interests |  |  | Total equity |
|  | (U.S. dollars in millions) |
Balance at June 30, 2025 |  |  | 1,253 |  |  |  | 58 |  |  |  | 28,003 |  |  |  | (14,676 | ) |  |  | (2,431 | ) |  |  | (4,128 | ) |  |  | 6,827 |  |  |  | 7 |  |  |  | 6,834 |
Net Income (loss) |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 433 |  |  |  |  |  |  |  |  |  |  |  | 433 |  |  |  | 1 |  |  |  | 434 |
Other comprehensive income (loss) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (44 | ) |  |  |  |  |  |  | (44 | ) |  |  |  |  |  |  | (44 | )
Stock-based compensation expense |  |  |  |  |  |  |  |  |  |  | 34 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 34 |  |  |  |  |  |  |  | 34 |
Dividend to non-controlling interests* |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (4 | ) |  |  | (4 | )
Balance at September 30, 2025 |  |  | 1,253 |  |  | $ | 58 |  |  | $ | 28,038 |  |  | $ | (14,243 | ) |  | $ | (2,475 | ) |  | $ | (4,128 | ) |  | $ | 7,250 |  |  | $ | 4 |  |  | $ | 7,254 |

* | In connection with a declaration of dividends to non-controlling interests in Teva’s subsidiary in Bulgaria.

|  | Teva shareholders’ equity |  |  |  |  |  |  |
|  | Ordinary shares |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Number of shares (in millions) |  |  | Stated value |  |  | Additional paid-in capital |  |  | Retained earnings (accumulated deficit) |  |  | Accumulated other comprehensive (loss) |  |  | Treasury shares |  |  | Total Teva shareholders’ equity |  |  | Non-controlling interests |  |  | Total equity |
|  | (U.S. dollars in millions) |
Balance at December 31, 2024 |  |  | 1,240 |  |  |  | 58 |  |  |  | 27,764 |  |  |  | (15,173 | ) |  |  | (3,148 | ) |  |  | (4,128 | ) |  |  | 5,373 |  |  |  | 7 |  |  |  | 5,380 |
Net Income (loss) |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 930 |  |  |  |  |  |  |  |  |  |  |  | 930 |  |  |  | 1 |  |  |  | 931 |
Other comprehensive income (loss) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 673 |  |  |  |  |  |  |  | 673 |  |  |  |  |  |  |  | 673 |
Issuance of Shares |  |  | 13 |  |  |  | * |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | * |  |  |  |  |  |  |  | * |
Proceeds from exercise of options |  |  |  |  |  |  |  |  |  |  | 3 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 3 |  |  |  |  |  |  |  | 3 |
Stock-based compensation expense |  |  |  |  |  |  |  |  |  |  | 106 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 106 |  |  |  |  |  |  |  | 106 |
Purchase of shares from redeemable non-controlling interests** |  |  |  |  |  |  |  |  |  |  | 165 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 165 |  |  |  |  |  |  |  | 165 |
Dividend to non-controlling interests*** |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (4 | ) |  |  | (4 | )
Balance at September 30, 2025 |  |  | 1,253 |  |  | $ | 58 |  |  | $ | 28,038 |  |  | $ | (14,243 | ) |  | $ | (2,475 | ) |  | $ | (4,128 | ) |  | $ | 7,250 |  |  | $ | 4 |  |  | $ | 7,254 |

* | Represents an amount less than $0.5 million.

** | In connection with the sale of Teva’s business venture in Japan. See note 17.

*** | In connection with a declaration of dividends to non-controlling interests in Teva’s subsidiary in Bulgaria.

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|  | Teva shareholders’ equity |  |  |  |  |  |  |
|  | Ordinary shares |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Number of shares (in millions) |  |  | Stated value |  |  | Additional paid-in capital |  |  | Retained earnings (accumulated deficit) |  |  | Accumulated other comprehensive (loss) |  |  | Treasury shares |  |  | Total Teva shareholders’ equity |  |  | Non-controlling interests |  |  | Total equity |
|  | (U.S. dollars in millions) |
Balance at June 30, 2024 |  |  | 1,239 |  |  |  | 58 |  |  |  | 27,829 |  |  |  | (14,519 | ) |  |  | (2,881 | ) |  |  | (4,128 | ) |  |  | 6,359 |  |  |  | 204 |  |  |  | 6,563 |
Net Income (loss) |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (437 | ) |  |  |  |  |  |  |  |  |  |  | (437 | ) |  |  | 47 |  |  |  | (390 | )
Other comprehensive income (loss) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 113 |  |  |  |  |  |  |  | 113 |  |  |  | 67 |  |  |  | 180 |
Issuance of shares |  |  | 1 |  |  |  | * |  |  |  | * |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | * |  |  |  |  |  |  |  | * |
Stock-based compensation expense |  |  |  |  |  |  |  |  |  |  | 29 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 29 |  |  |  |  |  |  |  | 29 |
Balance at September 30, 2024 |  |  | 1,240 |  |  | $ | 58 |  |  | $ | 27,860 |  |  | $ | (14,956 | ) |  | $ | (2,769 | ) |  | $ | (4,128 | ) |  | $ | 6,065 |  |  | $ | 319 |  |  | $ | 6,383 |

* | Represents an amount less than 0.5 million.

|  | Teva shareholders’ equity |  |  |  |  |  |  |
|  | Ordinary shares |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Number of shares (in millions) |  |  | Stated value |  |  | Additional paid-in capital |  |  | Retained earnings (accumulated deficit) |  |  | Accumulated other comprehensive (loss) |  |  | Treasury shares |  |  | Total Teva shareholders’ equity |  |  | Non-controlling interests |  |  | Total equity |
|  | (U.S. dollars in millions) |
Balance at December 31, 2023 |  |  | 1,227 |  |  |  | 57 |  |  |  | 27,807 |  |  |  | (13,534 | ) |  |  | (2,697 | ) |  |  | (4,128 | ) |  |  | 7,506 |  |  |  | 620 |  |  |  | 8,126 |
Net Income (loss) |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (1,422 | ) |  |  |  |  |  |  |  |  |  |  | (1,422 | ) |  |  | (262 | ) |  |  | (1,684 | )
Other comprehensive income (loss) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (69 | ) |  |  |  |  |  |  | (69 | ) |  |  | (6 | ) |  |  | (75 | )
Issuance of Shares |  |  | 13 |  |  |  | 1 |  |  |  | * |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1 |  |  |  |  |  |  |  | 1 |
Stock-based compensation expense |  |  |  |  |  |  |  |  |  |  | 89 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 89 |  |  |  |  |  |  |  | 89 |
Proceeds from exercise of options |  |  |  |  |  |  |  |  |  |  | 7 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 7 |  |  |  |  |  |  |  | 7 |
Dividend to non-controlling interest ** |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (18 | ) |  |  | (18 | )
Purchase of shares from non-controlling interests*** |  |  |  |  |  |  |  |  |  |  | (45 | ) |  |  |  |  |  |  | (3 | ) |  |  |  |  |  |  | (48 | ) |  |  | (16 | ) |  |  | (64 | )
Balance at September 30, 2024 |  |  | 1,240 |  |  | $ | 58 |  |  | $ | 27,860 |  |  | $ | (14,956 | ) |  | $ | (2,769 | ) |  | $ | (4,128 | ) |  | $ | 6,065 |  |  | $ | 319 |  |  | $ | 6,383 |

* | Represents an amount less than $0.5 million.

** | In connection with dividends to non-controlling interests in Teva’s business venture in Japan.

*** | Purchase of shares from non-controlling interests in a Teva’s subsidiary in Switzerland.

Amounts may not add up due to rounding.
The accompanying notes are an integral part of the financial statements.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(U.S. dollars in millions)
(Unaudited)

|  | Three months ended |  |  | Nine months ended |
|  | September 30, |  |  | September 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
Operating activities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net income (loss) |  | $ | 434 |  |  |  | (390 | ) |  | $ | 937 |  |  |  | (1,684 | )
Adjustments to reconcile net income (loss) to net cash provided by operations: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Depreciation and amortization |  |  | 249 |  |  |  | 259 |  |  |  | 742 |  |  |  | 790 |
Impairment of goodwill |  |  | — |  |  |  | 600 |  |  |  | — |  |  |  | 1,000 |
Impairment of long-lived assets and assets held for sale |  |  | 79 |  |  |  | (51 | ) |  |  | 255 |  |  |  | 758 |
Net change in operating assets and liabilities |  |  | (561 | ) |  |  | 317 |  |  |  | (1,595 | ) |  |  | (190 | )
Deferred income taxes – net and uncertain tax positions |  |  | 107 |  |  |  | (53 | ) |  |  | (76 | ) |  |  | (666 | )
Stock-based compensation |  |  | 34 |  |  |  | 29 |  |  |  | 106 |  |  |  | 89 |
Other items* |  |  | 27 |  |  |  | 2 |  |  |  | 122 |  |  |  | 597 |
Net loss (gain) from sale of business and long-lived assets |  |  | — |  |  |  | (21 | ) |  |  | — |  |  |  | (22 | )
Net cash provided by (used in) operating activities |  |  | 369 |  |  |  | 693 |  |  |  | 491 |  |  |  | 672 |
Investing activities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Beneficial interest collected in exchange for securitized trade receivables |  |  | 274 |  |  |  | 339 |  |  |  | 932 |  |  |  | 951 |
Purchases of property, plant and equipment and intangible assets |  |  | (136 | ) |  |  | (148 | ) |  |  | (359 | ) |  |  | (369 | )
Proceeds from sale of business and long-lived assets, net |  |  | 8 |  |  |  | 38 |  |  |  | 34 |  |  |  | 39 |
Acquisition of businesses, net of cash acquired |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (15 | )
Purchases of investments and other assets |  |  | (13 | ) |  |  | (1 | ) |  |  | (40 | ) |  |  | (56 | )
Proceeds from sale of investments |  |  | — |  |  |  | 40 |  |  |  | — |  |  |  | 40 |
Other investing activities |  |  | 2 |  |  |  | — |  |  |  | 5 |  |  |  | — |
Net cash provided by (used in) investing activities |  |  | 135 |  |  |  | 268 |  |  |  | 572 |  |  |  | 590 |
Financing activities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Repayment of senior notes and loans and other long-term liabilities |  |  | (444 | ) |  |  | — |  |  |  | (4,112 | ) |  |  | (956 | )
Proceeds from senior notes, net of issuance costs |  |  | (7 | ) |  |  | — |  |  |  | 2,298 |  |  |  | — |
Purchase of shares from redeemable and non-redeemable non-controlling interests |  |  | — |  |  |  | — |  |  |  | (38 | ) |  |  | (64 | )
Dividends paid to redeemable and non-redeemable non-controlling interests |  |  | — |  |  |  | — |  |  |  | (340 | ) |  |  | (78 | )
Other financing activities |  |  | (2 | ) |  |  | — |  |  |  | 1 |  |  |  | (19 | )
Net cash provided by (used in) financing activities |  |  | (453 | ) |  |  | — |  |  |  | (2,191 | ) |  |  | (1,117 | )
Translation adjustment on cash and cash equivalents |  |  | (9 | ) |  |  | 100 |  |  |  | 31 |  |  |  | (53 | )
Net change in cash and cash equivalents |  |  | 42 |  |  |  | 1,061 |  |  |  | (1,097 | ) |  |  | 92 |
Balance of cash, cash equivalents at beginning of period |  |  | 2,161 |  |  |  | 2,258 |  |  |  | 3,300 |  |  |  | 3,227 |
Balance of cash, cash equivalents at end of period |  | $ | 2,203 |  |  |  | 3,319 |  |  | $ | 2,203 |  |  |  | 3,319 |
Non-cash financing and investing activities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Beneficial interest obtained in exchange for securitized accounts receivables |  | $ | 296 |  |  |  | 332 |  |  | $ | 937 |  |  |  | 964 |

* | Adjustment in the nine-month period ended September 30, 2024 was mainly related to an agreement with the Israeli Tax Authorities. See note 11.

Amounts may not add up due to rounding.
The accompanying notes are an integral part of the financial statements.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
Note 1 – Basis of presentation:
a. Basis of presentation
The accompanying unaudited consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements. In the opinion of management, the financial statements reflect all normal and recurring adjustments necessary for a fair statement of the financial position and results of operations of Teva. The information included in this Quarterly Report on Form
10-Q
should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form
10-K
for the year ended December 31, 2024, as filed with the Securities and Exchange Commission (“SEC”). The
year-end
balance sheet data was derived from the audited consolidated financial statements as of December 31, 2024, but not all disclosures required by generally accepted accounting principles in the United States (“U.S. GAAP”) are included.
In preparing the Company’s consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets, liabilities, equity and disclosure of contingent liabilities and assets at the dates of the financial statements and the reported amounts of revenues and expenses during the reported years. Actual results could differ from those estimates.
In preparing the Company’s consolidated financial statements, management also considered the economic implications of inflation expectations on its critical and significant accounting estimates. Government actions taken to address macroeconomic developments, as well as their economic impact on Teva’s third-party manufacturers and suppliers, customers and markets, could also impact such estimates and may change in future periods. As applicable to these consolidated financial statements, the most significant estimates and assumptions relate to determining the valuation and recoverability of IPR&D and long-lived assets, marketed product rights, contingent consideration and goodwill, assessing sales reserves and allowances in the United States, uncertain tax positions, valuation allowances and contingencies. Some of these estimates could be impacted by higher costs and the ability to pass on such higher costs to customers, which is highly uncertain.
In preparing the Company’s consolidated financial statements, management also considered the impact of geopolitical conflicts and developments, including in the Middle East and in Russia and Ukraine. During the three and nine months ended September 30, 2025, the impact of these conflicts on Teva’s results of operation and financial condition continued to be immaterial.
Teva’s results of operations for the three and nine months ended September 30, 2025, are not necessarily indicative of results that could be expected for the entire fiscal year.
Certain amounts in the consolidated financial statements and associated notes may not add up due to rounding. All percentages have been calculated using unrounded amounts.
b. Significant accounting policies
Recently adopted accounting pronouncements
None.
Recently issued accounting pronouncements, not yet adopted
In September 2025, the FASB issued ASU
No. 2025-07
(“ASU
2025-07”),
Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606). The guidance refines the scope of Topic 815 by clarifying which contracts are subject to derivative accounting and expand the scope exception for certain contracts not traded on an exchange to include contracts for which settlement is based on operations or activities specific to one of the parties to the contract. The guidance also provides clarification under Topic 606 for share-based payments from a customer in a revenue contract. The amendments in ASU
2025-07
are effective for annual periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. Early adoption is permitted. The amendments may be applied prospectively or on a modified retrospective basis. The Company does not expect ASU 2025-07 will have a material impact on its consolidated financial statements.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
In July 2025, the FASB issued ASU
2025-05,
Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, which provides a practical expedient when estimating credit losses on accounts receivable and contract assets arising from transactions accounted for under ASC 606, Revenue from Contracts with Customers. Under this practical expedient, an entity is allowed to assume that the current conditions it has applied in determining credit loss allowances for current accounts receivable and current contract assets remain unchanged for the remaining life of those assets. The ASU is effective for annual periods beginning after December 15, 2025, and interim periods within those annual reporting periods. Early adoption is permitted. The Company does not expect ASU
2025-05
to have a material impact on its consolidated financial statements.
In May 2025, the FASB issued ASU
2025-03
“Business Combinations and Consolidation: Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity,” which amends the guidance for determining the accounting acquirer in certain transactions. The guidance should be applied prospectively. The amendments in this update are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods, with early adoption permitted. The adoption of this guidance will affect acquisition transactions of variable interest entities that occur after the initial application date.
In November 2024, the FASB issued ASU
2024-03
“Income Statement: Reporting Comprehensive Income—Expense Disaggregation Disclosures,” which requires more detailed information about specified categories of expenses (purchases of inventory, employee compensation, depreciation, amortization, and depletion) included in certain expense captions presented on the face of the income statement, as well as disclosures about selling expenses. Additionally, in January 2025, the FASB issued ASU
2025-01
to clarify the effective date of ASU
2024-03.
ASU
2024-03
is effective for fiscal years beginning after December 15, 2026 and for interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The amendments may be applied either (1) prospectively to financial statements issued for reporting periods after the effective date of this ASU or (2) retrospectively to all prior periods presented in the financial statements. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements disclosures.
In December 2023, the FASB issued ASU
2023-09
“Income Taxes (Topic 740): Improvements to Income Tax Disclosures.” This guidance is intended to enhance the transparency and decision-usefulness of income tax disclosures. The amendments in ASU
2023-09
address investor requests for enhanced income tax information primarily through changes to disclosure regarding rate reconciliation and income taxes paid both in the U.S. and in foreign jurisdictions. ASU
2023-09
is effective for fiscal years beginning after December 15, 2024 on a prospective basis, with the option to apply the standard retrospectively. The Company expects the adoption of this standard to result in expanded disclosures in its consolidated financial statements.
In October 2023, the FASB issued ASU
2023-06
“Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative,” which incorporates certain SEC disclosure requirements into the FASB Accounting Standards Codification (“Codification”). The amendments in the ASU are expected to clarify or improve disclosure and presentation requirements of a variety of Codification topics, allow investors to more easily compare entities subject to the SEC’s existing disclosures with those entities that were not previously subject to the requirements, and align the requirements in the Codification with the SEC’s regulations. The effective date for each amendment will be the date on which the SEC’s removal of that related disclosure from Regulation
S-X
or Regulation
S-K
becomes effective, with early adoption prohibited. The amendments in this ASU should be applied prospectively. For all entities within the scope of the affected Codification subtopics, if by June 30, 2027, the SEC has not removed the applicable requirement from Regulation
S-X
or Regulation
S-K,
the pending content of the associated amendment will be removed from the Codification and will not become effective for any entities. The Company does not expect ASU
2023-06
to have a material impact on its consolidated financial statements.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
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 TEV-‘316, 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 TEV-‘333, an
anti-PD-1
oncology biosimilar candidate, and Teva will manage regulatory approvals and oversee commercialization in the designated markets.
In 2024, Teva paid mAbxience upfront and milestone payments of $20 million under the initial agreement, and $15 million under the amendment to the licensing agreement, which were recorded as R&D expenses. In the second quarter of 2025, Teva recognized a milestone payment of $12 million as R&D expenses, which was paid in the third quarter of 2025. In the third quarter of 2025, Teva recognized milestone payments in the amount of $17 million as R&D expenses, which are expected to be paid in the fourth quarter of 2025. mAbxience may be eligible for additional future development, regulatory and commercial milestone payments, in an aggregate amount of up to $291 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 nine months of 2025 and during 2024, Teva recorded $88 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 with potential indications including atopic dermatitis and asthma. In exchange, Teva paid an upfront payment of $10 million in January 2024, which was recorded as R&D expenses in the fourth quarter of 2023. In the second quarter of 2025, Teva paid a milestone payment of $5 million, which was recorded as R&D expenses in the first quarter of 2025. Biolojic may be eligible to receive additional development and commercial milestone payments of approximately $500
million, over the next several years, based on the achievement of certain
pre-clinical,
clinical and regulatory milestones, with the majority of payments based on future sales achievements. On May 27, 2025, investigational new drug (IND)-enabling studies of BD9 were initiated for this program.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
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 by Royalty Pharma. 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
2
b study for duvakitug met its primary endpoints in patients with ulcerative colitis and Crohn’s disease. In
October 2025
, Sanofi and Teva initiated Phase
3
studies for Teva’s duvakitug (anti-TL
1
A) for inflammatory bowel disease.
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 paid an upfront payment of $10
million to Modag in the fourth quarter of 2021, recorded as R&D expenses. 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).
On September 9, 2025, Teva received Fast Track designation from the FDA for emrusolmin
(TEV-’286).
In the second quarter of 2025, Teva initiated a Phase 1 clinical trial for
TEV-‘287,
which is being developed for the treatment of Parkinson’s disease, and consequently paid a milestone payment of
$
10
million, which was recorded as R&D expenses. 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 included biosimilar candidates addressing multiple therapeutic areas, including the then 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. In the first quarter of 2025, Teva made an additional milestone payment of $5 million, which was recognized as R&D expense 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, which were redeemed and paid by Alvotech to Teva for $44 million, including accrued interest, in July 2024.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
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, 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. On October 22, 2024, 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 the treatment of adults with Crohn’s disease and ulcerative colitis. On February 21, 2025, Alvotech and Teva announced that SELARSDI was available in the United States, and on May 5, 2025, the FDA 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, the FDA accepted for review Biologic License Applications (“BLA”) for Alvotech’s proposed biosimilars to Simponi
®
and Simponi Aria
®
(golimumab) and in February 2025, the FDA accepted for review a BLA for Alvotech’s proposed biosimilar to Eylea
®
(aflibercept
). On November 2, 2025, Alvotech announced that the FDA issued a complete response letter (CRL) for the BLA of Alvotech’s proposed biosimilar to Simponi
®
(golimumab), in a prefilled syringe and autoinjector presentations.
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. In 2017, Teva received an upfront payment of $30 million and a milestone payment of $20 million. 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, which termination became effective on May 31, 2025, with all remaining rights to the ATTENUKINE technology reverting back to Teva.
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 October 10, 2025, Teva and MedinCell announced that the FDA approved UZEDY as a once-monthly extended-release injectable suspension as monotherapy or as adjunctive therapy to lithium or valproate for the maintenance treatment of bipolar 1 disorder
(BD-1)
in adults. MedinCell may be eligible for future sales-based milestone payments 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 candidate to Phase 3 and, as a result, paid a milestone payment of $3 million 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 were presented during the third quarter of 2025, showing no incidence of post-injection delirium/sedation syndrome (PDSS) in study participants taking olanzapine LAI
(TEV-‘749).
Teva paid a $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).
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
Assets and Liabilities Held for Sale:
General
Assets and liabilities held for sale as of September 30, 2025 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. As of the date of this Quarterly Report on Form 10-Q, exclusive discussions with a selected buyer on the sale
have
terminated. Teva is initiating a renewed sales process, maintaining its strategic intention to divest its API business. 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 nine months of 2025, Teva recorded expenses of $6 million in other assets impairments, restructuring and other items. See note 12.
On March 31, 2025, Teva divested its business venture in Japan, for which Teva recorded a marginal gain in the first quarter of 2025.
Teva has elected the policy to include the currency translation adjustment related to the disposal group as part of the asset carrying amount.
The Company has determined that the intended divestiture of its businesses does not represent a strategic shift that would have a major effect on the Company’s operations and financial results and therefore it did not meet the criteria for discontinued operations classification.
The table below summarizes all of Teva’s assets and liabilities included as held for sale as of September 30, 2025 and December 31, 2024:

|  | September 30, |  |  | December 31, |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions) |
Accounts receivables |  | $ | 91 |  |  |  | 222 |
Inventories |  |  | 512 |  |  | $ | 647 |
Property, plant and equipment, net and others |  |  | 975 |  |  |  | 913 |
Identifiable intangible assets, net |  |  | 21 |  |  |  | 83 |
Goodwill |  |  | 207 |  |  |  | 255 |
Other current assets |  |  | 93 |  |  |  | 99 |
Other non-current assets |  |  | 190 |  |  |  | 236 |
Expected loss on sale* |  |  | (280 | ) |  |  | (684 | )
Total assets of the disposal group classified as held for sale in the consolidated balance sheets |  | $ | 1,809 |  |  | $ | 1,771 |
Accounts payables |  |  | (227 | ) |  |  | (283 | )
Other current liabilities |  |  | (24 | ) |  |  | (49 | )
Other non-current liabilities |  |  | (73 | ) |  |  | (85 | )
Expected loss on sale* |  |  | — |  |  |  | (281 | )
Total liabilities of the disposal group classified as held for sale in the consolidated balance sheets |  | $ | (324 | ) |  | $ | (698 | )

* | Includes an expected loss from reclassification of currency translation adjustments to the consolidated statements of income (loss) upon sale.

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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
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, 2025 |
|  | United States |  |  | Europe |  |  | International Markets |  |  | Other activities |  |  | Total |
|  | (U.S.$ in millions) |
Sale of goods |  |  | 2,063 |  |  |  | 1,207 |  |  |  | 512 |  |  |  | 125 |  |  |  | 3,907 |
Licensing arrangements |  |  | 27 |  |  |  | 11 |  |  |  | 5 |  |  |  | 3 |  |  |  | 46 |
Distribution |  |  | 392 |  |  |  | § |  |  |  | 14 |  |  |  | — |  |  |  | 406 |
Other |  |  | § |  |  |  | 16 |  |  |  | 26 |  |  |  | 78 |  |  |  | 121 |
|  | $ | 2,483 |  |  | $ | 1,235 |  |  | $ | 557 |  |  | $ | 205 |  |  | $ | 4,480 |

§ | Represents an amount less than $0.5 million.

|  | Three months ended September 30, 2024 |
|  | United States |  |  | Europe |  |  | International Markets |  |  | Other activities |  |  | Total |
|  | (U.S.$ in millions) |
Sale of goods |  |  | 1,822 |  |  |  | 1,214 |  |  |  | 568 |  |  |  | 121 |  |  |  | 3,725 |
Licensing arrangements |  |  | 23 |  |  |  | 9 |  |  |  | 6 |  |  |  | 8 |  |  |  | 45 |
Distribution |  |  | 380 |  |  |  | § |  |  |  | 10 |  |  |  | — |  |  |  | 390 |
Other |  |  | § |  |  |  | 42 |  |  |  | 29 |  |  |  | 100 |  |  |  | 172 |
|  | $ | 2,225 |  |  | $ | 1,265 |  |  | $ | 613 |  |  | $ | 229 |  |  | $ | 4,332 |

§ | Represents an amount less than $0.5 million.

|  | Nine months ended September 30, 2025 |
|  | United States |  |  | Europe |  |  | International Markets |  |  | Other activities |  |  | Total |
|  | (U.S.$ in millions) |
Sale of goods |  |  | 5,332 |  |  |  | 3,681 |  |  |  | 1,535 |  |  |  | 389 |  |  |  | 10,937 |
Licensing arrangements |  |  | 78 |  |  |  | 27 |  |  |  | 20 |  |  |  | 3 |  |  |  | 128 |
Distribution |  |  | 1,130 |  |  |  | 1 |  |  |  | 36 |  |  |  | — |  |  |  | 1,167 |
Other |  |  | 3 |  |  |  | 18 |  |  |  | 43 |  |  |  | 251 |  |  |  | 314 |
|  | $ | 6,543 |  |  | $ | 3,726 |  |  | $ | 1,634 |  |  | $ | 644 |  |  | $ | 12,547 |

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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)

|  | Nine months ended September 30, 2024 |
|  | United States |  |  | Europe |  |  | International Markets |  |  | Other activities |  |  | Total |
|  | (U.S.$ in millions) |
Sale of goods |  |  | 4,857 |  |  |  | 3,668 |  |  |  | 1,708 |  |  |  | 399 |  |  |  | 10,632 |
Licensing arrangements |  |  | 68 |  |  |  | 26 |  |  |  | 17 |  |  |  | 10 |  |  |  | 121 |
Distribution |  |  | 1,134 |  |  |  | § |  |  |  | 28 |  |  |  | — |  |  |  | 1,163 |
Other |  |  | § |  |  |  | 54 |  |  |  | 49 |  |  |  | 295 |  |  |  | 399 |
|  | $ | 6,060 |  |  | $ | 3,749 |  |  | $ | 1,802 |  |  | $ | 703 |  |  | $ | 12,315 |

§ | Represents an amount less than $0.5 million.

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 70% of the Company’s total SR&A as of September 30, 2025, 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, 2025 and 2024 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, 2025 |  | $ | 56 |  |  | $ | 1,674 |  |  | $ | 561 |  |  | $ | 936 |  |  | $ | 399 |  |  | $ | 108 |  |  | $ | 3,678 |  |  | $ | 3,734 |
Provisions related to sales made in current year period |  |  | 310 |  |  |  | 3,746 |  |  |  | 753 |  |  |  | 6,012 |  |  |  | 213 |  |  |  | 120 |  |  |  | 10,844 |  |  |  | 11,154 |
Provisions related to sales made in prior periods |  |  | — |  |  |  | (38 | ) |  |  | 33 |  |  |  | (29 | ) |  |  | (3 | ) |  |  | (11 | ) |  |  | (48 | ) |  |  | (48 | )
Credits and payments |  |  | (295 | ) |  |  | (3,432 | ) |  |  | (701 | ) |  |  | (6,062 | ) |  |  | (168 | ) |  |  | (93 | ) |  |  | (10,456 | ) |  |  | (10,751 | )
Translation differences |  |  |  |  |  |  | 61 |  |  |  | 16 |  |  |  | 18 |  |  |  | 5 |  |  |  | 16 |  |  |  | 116 |  |  |  | 116 |
Balance at September 30, 2025 |  | $ | 71 |  |  | $ | 2,011 |  |  | $ | 662 |  |  | $ | 875 |  |  | $ | 446 |  |  | $ | 140 |  |  | $ | 4,134 |  |  | $ | 4,205 |

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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)

|  | 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, 2024 |  | $ | 61 |  |  | $ | 1,603 |  |  | $ | 540 |  |  | $ | 859 |  |  | $ | 436 |  |  | $ | 97 |  |  | $ | 3,535 |  |  | $ | 3,596 |
Provisions related to sales made in current year period |  |  | 294 |  |  |  | 3,436 |  |  |  | 579 |  |  |  | 5,925 |  |  |  | 191 |  |  |  | 146 |  |  |  | 10,277 |  |  |  | 10,571 |
Provisions related to sales made in prior periods |  |  | — |  |  |  | 16 |  |  |  | 26 |  |  |  | (11 | ) |  |  | (28 | ) |  |  | (2 | ) |  |  | 1 |  |  |  | 1 |
Credits and payments |  |  | (292 | ) |  |  | (3,269 | ) |  |  | (556 | ) |  |  | (5,877 | ) |  |  | (209 | ) |  |  | (121 | ) |  |  | (10,032 | ) |  |  | (10,324 | )
Translation differences |  |  | — |  |  |  | 1 |  |  |  | 3 |  |  |  | 1 |  |  |  | (1 | ) |  |  | — |  |  |  | 4 |  |  |  | 4 |
Balance at September 30, 2024 |  | $ | 63 |  |  | $ | 1,787 |  |  | $ | 592 |  |  | $ | 897 |  |  | $ | 389 |  |  | $ | 120 |  |  | $ | 3,785 |  |  | $ | 3,848 |

NOTE 4 – Inventories:
Inventories, net of reserves, consisted of the following:

|  | September 30, |  |  | December 31, |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions) |
Finished products |  | $ | 2,027 |  |  | $ | 1,783 |
Raw and packaging materials |  |  | 799 |  |  |  | 671 |
Products in process |  |  | 330 |  |  |  | 353 |
Materials in transit and payments on account |  |  | 168 |  |  |  | 199 |
|  | $ | 3,323 |  |  | $ | 3,007 |

NOTE 5 – Identifiable intangible assets:
Identifiable intangible assets consisted of the following:

|  | Gross carrying amount net of impairment |  |  | Accumulated amortization |  |  | Net carrying amount |
|  | September 30, 2025 |  |  | December 31, 2024 |  |  | September 30, 2025 |  |  | December 31, 2024 |  |  | September 30, 2025 |  |  | December 31, 2024 |
|  | (U.S. $ in millions) |
Product rights |  | $ | 16,338 |  |  | $ | 15,915 |  |  | $ | 12,872 |  |  | $ | 11,998 |  |  | $ | 3,466 |  |  | $ | 3,917 |
Trade names |  |  | 595 |  |  |  | 568 |  |  |  | 331 |  |  |  | 300 |  |  |  | 264 |  |  |  | 268 |
In process research and development |  |  | 206 |  |  |  | 233 |  |  |  | — |  |  |  | — |  |  |  | 206 |  |  |  | 233 |
Total |  | $ | 17,139 |  |  | $ | 16,716 |  |  | $ | 13,203 |  |  | $ | 12,298 |  |  | $ | 3,936 |  |  | $ | 4,418 |

Product rights and trade names
Product rights and trade names are assets presented at amortized cost. Product rights and trade names represent a portfolio of pharmaceutical products in various therapeutic categories from various acquisitions with a weighted average life period of approximately 8 years.
Amortization of intangible assets was $144 million and $146 million in the three months ended September 30, 2025 and 2024, respectively.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
Amortization of intangible assets was $436 million and $444 million in the nine months ended September 30, 2025 and 2024, respectively.
IPR&D
Teva’s IPR&D are assets that have not yet been approved in its major markets. IPR&D carries intrinsic risks that the asset might not succeed in advanced phases and may be impaired in future periods.
Intangible assets impairments
Impairments of long-lived intangible assets for the three months ended September 30, 2025 and 2024 were $64 million and $28 million, respectively.
Impairments in the third quarter of 2025 consisted of:

| (a) | Identifiable product rights of $57 million, mainly related to updated market assumptions regarding price and volume of products mainly in the U.S.; and

| (b) | IPR&D assets of $7 million, mainly related to generic pipeline products resulting from development progress and changes in other key valuation indications mainly in the U.S. (e.g., market size, competition assumptions, legal landscape and launch date).

Impairments in the third quarter of 2024 consisted of identifiable product rights of $28 million, mainly due to updated market assumptions regarding price and volume of products mainly in the U.S.
Impairments of long-lived intangible assets for the nine months ended September 30, 2025 and 2024 were $227 million and $169 million, respectively.
Impairments in the first nine months of 2025 consisted of:

| (a) | Identifiable product rights of $210 million due to: (i) $123 million mainly related to updated market assumptions regarding price and volume of products in Europe and in the U.S., and (ii) $87 million mainly related to a change in Teva’s commercial plan regarding certain products as part of its optimization efforts mainly in the U.S.; and

| (b) | IPR&D assets of $17 million, mainly related to generic pipeline products resulting from development progress and changes in other key valuation indications mainly in the U.S. (e.g., market size, competition assumptions, legal landscape and launch date).

Impairments in the first nine months of 2024 consisted of:

| (a) | Identifiable product rights of $136 million, mainly due to updated market assumptions regarding price and volume of products mainly in the U.S.; and

| (b) | IPR&D assets of $33 million, mainly due to generic pipeline products resulting from development progress and changes in other key valuation indications mainly in the U.S. (e.g., market size, competition assumptions, legal landscape and launch date).

The fair value measurement of the impaired intangible assets in the first nine months ended September 30, 2025, is based on significant unobservable inputs in the market and thus represents a Level 3 measurement within the fair value hierarchy. The discount rate applied ranged between
8.25
% to 9.25%. A probability of success factor of
90
%
was used in the fair value calculation to reflect inherent regulatory and commercial risk of IPR&D.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
NOTE 6 – Goodwill:
Changes in the carrying amount of goodwill for the period ended September 30, 2025, were as follows:

|  | United States |  |  | Europe |  |  | International Markets |  |  | Other |  |  | Total |
|  | Teva’s API |  |  | Medis |
|  | (U.S. $ in millions) |
Balance as of December 31, 2024 (1) |  | $ | 5,732 |  |  | $ | 8,075 |  |  | $ | 1,110 |  |  |  | — |  |  | $ | 232 |  |  | $ | 15,147 |
Other changes during the period: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Translation differences and other |  |  | — |  |  |  | 720 |  |  |  | 18 |  |  |  | — |  |  |  | 59 |  |  |  | 797 |
Balance as of September 30, 2025 (1) |  | $ | 5,732 |  |  | $ | 8,795 |  |  | $ | 1,128 |  |  |  | — |  |  | $ | 291 |  |  | $ | 15,945 |

(1) | Cumulative goodwill impairment as of September 30, 2025 and December 31, 2024, was each approximately $29.6 billion.

Teva operates its business through three reporting segments: United States, Europe and International Markets. Each of these business segments is a reporting unit. Additional reporting units include Teva’s production and sale of APIs to third parties (“Teva API”) and an
out-licensing
platform offering a portfolio of products to other pharmaceutical companies through its affiliate Medis. Teva’s API and Medis reporting units are included under “Other” in the table above. See note 15 for additional segment information.
Teva determines the fair value of its reporting units using the income approach. The income approach is a forward-looking approach for estimating fair value. Within the income approach, the method used is the discounted cash flow method. Teva begins with a forecast of all the expected net cash flows associated with the reporting unit, which includes the application of a terminal value, and then applies a discount rate to arrive at a net present value amount. Cash flow projections are based on Teva’s estimates of revenue growth rates and operating margins, taking into consideration industry and market conditions. The discount rate used is based on the weighted average cost of capital (“WACC”), adjusted for the relevant risk associated with country-specific and business-specific characteristics. If any of these expectations were to vary materially from Teva’s assumptions, Teva may record an impairment of goodwill allocated to these reporting units in the future.
First Quarter Developments
During the first quarter of 2025, management evaluated whether there were any developments that occurred during the quarter to determine if it was more likely than not that the fair value of any of its reporting units was below its carrying amount as of March 31, 2025. Management concluded that no triggering event had occurred and, therefore, no quantitative assessment was performed.
Second Quarter Developments
Pursuant to Company policy, Teva conducted its annual goodwill impairment test for all reporting units during the second quarter of 2025. Management considered all information available, including information gathered from its latest long-range planning (“LRP”) process and annual operating plan (“AOP”), which are parts of Teva’s internal financial planning and budgeting processes, as well as the recently announced “Accelerate Growth” phase under Teva’s Pivot to Growth strategy (“Teva’s Strategy”). The LRP, the AOP and Teva’s Strategy were discussed and reviewed by Teva’s management and its Board of Directors.
Additionally, Teva conducted a quantitative analysis of all of its reporting units as part of its annual goodwill impairment test with the assistance of an independent valuation expert.
Based on this quantitative analysis, no goodwill impairment charge was recorded in the second quarter of 2025.
As of June 30, 2025, Teva’s United States, Europe, International Markets and Medis reporting units each had fair values in excess of 10% over their book values.
In the second quarter of 2024, Teva recorded a goodwill impairment charge of $400 million related to Teva’s API reporting unit.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
Third Quarter Developments
During the third quarter of 2025, management evaluated whether there were any developments that occurred during the quarter to determine if it was more likely than not that the fair value of any of its reporting units was below its carrying amount as of September 30, 2025. Management concluded that no triggering event had occurred and, therefore, no quantitative assessment was performed.
In the third quarter of 2024, Teva recorded a goodwill impairment charge of $600 million related to Teva’s API reporting unit.
NOTE 7 – Debt obligations:

a. | Short-term debt:

|  |  |  |  |  | September 30, |  |  | December 31, |
|  | Interest rate as of September 30, 2025 |  |  | Maturity |  |  | 2025 |  |  | 2024 |
|  |  |  |  |  |  |  | (U.S. $ in millions) |
Convertible senior debentures |  |  | 0.25 | % |  |  | 2026 |  |  |  | 23 |  |  |  | 23 |
Current maturities of long-term liabilities and other |  |  |  |  |  |  |  |  |  |  | 1 |  |  |  | 1,758 |
Total short-term debt |  |  |  |  |  |  |  |  |  | $ | 24 |  |  | $ | 1,781 |

Convertible senior debentures
The principal amount of Teva’s 0.25% convertible senior debentures due in 2026 was $23 million as of September 30, 2025 and as of December 31, 2024. These convertible senior debentures include a “net share settlement” feature according to which the principal amount will be paid in cash and in case of conversion, only the residual conversion value above the principal amount will be paid in Teva shares.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)

b. | Long-term debt:

|  | Interest rate as of September 30, 2025 |  |  | Maturity |  |  | September 30, 2025 |  |  | December 31, 2024 |
|  |  |  |  |  |  |  | (U.S. $ in millions) |
Senior notes EUR 1,000 million (4) |  |  | 6.00 | % |  |  | 2025 |  |  |  | — |  |  |  | 429 |
Senior notes USD 1,000 million (5) |  |  | 7.13 | % |  |  | 2025 |  |  |  | — |  |  |  | 427 |
Senior notes EUR 900 million (6) |  |  | 4.50 | % |  |  | 2025 |  |  |  | — |  |  |  | 515 |
Senior notes CHF 350 million (12) |  |  | 1.00 | % |  |  | 2025 |  |  |  | — |  |  |  | 387 |
Senior notes USD 3,500 million (10) |  |  | 3.15 | % |  |  | 2026 |  |  |  | 1,798 |  |  |  | 3,374 |
Senior notes EUR 700 million |  |  | 1.88 | % |  |  | 2027 |  |  |  | 820 |  |  |  | 730 |
Sustainability-linked senior notes USD 1,000 million (1)(*)(10) |  |  | 4.75 | % |  |  | 2027 |  |  |  | 649 |  |  |  | 1,000 |
Sustainability-linked senior notes EUR 1,100 million (1)(*) |  |  | 3.75 | % |  |  | 2027 |  |  |  | 1,290 |  |  |  | 1,144 |
Senior notes USD 1,250 million |  |  | 6.75 | % |  |  | 2028 |  |  |  | 1,250 |  |  |  | 1,250 |
Senior notes EUR 750 million |  |  | 1.63 | % |  |  | 2028 |  |  |  | 877 |  |  |  | 778 |
Sustainability-linked senior notes USD 1,000 million (2)(*) |  |  | 5.13 | % |  |  | 2029 |  |  |  | 1,000 |  |  |  | 1,000 |
Sustainability-linked senior notes USD 600 million (3)(*)(10) |  |  | 7.88 | % |  |  | 2029 |  |  |  | 398 |  |  |  | 600 |
Sustainability-linked senior notes EUR 800 million (3)(*)(10) |  |  | 7.38 | % |  |  | 2029 |  |  |  | 778 |  |  |  | 835 |
Sustainability-linked senior notes EUR 1,500 million (2)(*) |  |  | 4.38 | % |  |  | 2030 |  |  |  | 1,760 |  |  |  | 1,562 |
Senior notes USD 700 million (7) |  |  | 5.75 | % |  |  | 2030 |  |  |  | 696 |  |  |  | — |
Sustainability-linked senior notes USD 500 million (3)(*) |  |  | 8.13 | % |  |  | 2031 |  |  |  | 500 |  |  |  | 500 |
Sustainability-linked senior notes EUR 500 million (3)(*) |  |  | 7.88 | % |  |  | 2031 |  |  |  | 587 |  |  |  | 521 |
Senior notes EUR 1,000 million (8) |  |  | 4.13 | % |  |  | 2031 |  |  |  | 1,165 |  |  |  | — |
Senior notes USD 500 million (9) |  |  | 6.00 | % |  |  | 2032 |  |  |  | 496 |  |  |  | — |
Senior notes USD 789 million |  |  | 6.15 | % |  |  | 2036 |  |  |  | 784 |  |  |  | 783 |
Senior notes USD 2,000 million |  |  | 4.10 | % |  |  | 2046 |  |  |  | 1,988 |  |  |  | 1,986 |
Total senior notes |  |  |  |  |  |  |  |  |  |  | 16,836 |  |  |  | 17,821 |
Less current maturities |  |  |  |  |  |  |  |  |  |  | — |  |  |  | (1,758 | )
Less debt issuance costs (11) |  |  |  |  |  |  |  |  |  |  | (70 | ) |  |  | (61 | )
Total senior notes and loans |  |  |  |  |  |  |  |  |  | $ | 16,766 |  |  | $ | 16,002 |

(1) | If Teva fails to achieve certain sustainability performance targets, a one-time premium payment of 0.15%-0.45% out of the principal amount will be paid at maturity or upon earlier redemption, if such redemption is on or after May 9, 2026.

(2) | If Teva fails to achieve certain sustainability performance targets, the interest rate shall increase by 0.125%-0.375% per annum, from and including May 9, 2026.

(3) | If Teva fails to achieve certain sustainability performance targets, the interest rate shall increase by 0.100%-0.300% per annum, from and including September 15, 2026.

(4) | In January 2025, Teva repaid $426 million of its 6.00% senior notes due 2025 at maturity.

(5) | In January 2025, Teva repaid $427 million of its 7.13% senior notes due 2025 at maturity.

(6) | In March 2025, Teva repaid $515 million of its 4.50% senior notes due 2025 at maturity.

(7) | In May 2025, Teva issued senior notes in an aggregate principal amount of $700 million bearing 5.75% annual interest and due December 2030.

(8) | In May 2025, Teva issued senior notes in an aggregate principal amount of €1,000 million bearing 4.125% annual interest and due June 2031.

(9) | In May 2025, Teva issued senior notes in an aggregate principal amount of $500 million bearing 6.00% annual interest and due December 2032.

(10) | In June 2025, Teva consummated a cash tender offer and extinguished $1,579 million aggregate principal amount of its 3.15% senior notes due 2026; $351 million aggregate principal amount of its 4.75% senior notes due 2027; $202 million aggregate principal amount of its 7.88% senior notes due in 2029; and $157 million aggregate principal amount of its 7.38% senior notes due in 2029. The extinguishment resulted in a loss of $10 million which was recorded under financial expenses, net.

(11) | Debt issuance costs as of September 30, 2025 include $20 million in connection with the issuance of the senior notes in May 2025, partially offset by $6 million acceleration of issuance costs related to the cash tender offer.

(12) | In July 2025, Teva repaid $444 million of its 1% senior notes due 2025 at maturity.

* | Interest rate adjustments and a potential one-time premium payment related to the sustainability-linked bonds are treated as bifurcated embedded derivatives. See note 8c.

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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
Long-term debt was issued by several indirect wholly owned subsidiaries of the Company and is fully and unconditionally guaranteed by the Company as to payment of all principal, interest, discount and additional amounts, if any. The long-term debt outlined in the above table is generally redeemable at any time at varying redemption prices plus accrued and unpaid interest.
Teva’s debt as of September 30, 2025 was effectively denominated in the following currencies: 57% in U.S. dollars and 43% in euro.
Teva’s principal sources of short-term liquidity are its cash on hand, existing cash investments, liquid securities and available credit facilities, primarily its $1.8 billion unsecured syndicated sustainability-linked revolving credit facility entered into in April 2022, as amended in February 2023 and in May 2024 (“RCF”).
The RCF had an initial maturity date of
April 2026
with two
one-year
extension options. In April 2024, an extension option was exercised and the RCF maturity date was extended to April 2027. The RCF contains certain covenants, including certain limitations on incurring liens and indebtedness and maintenance of certain financial ratios, including a maximum leverage ratio, which becomes more restrictive over time.
On May 3, 2024, the terms of the RCF were amended to update the Company’s maximum permitted leverage ratio under the RCF for certain periods. Under the terms of the RCF, as amended, the Company’s leverage ratio shall not exceed (i) 4.00x in 2025 and in the first quarter of 2026, (ii) 3.75x in the second, third and fourth quarters of 2026 and (iii) 3.50x in the first quarter of 2027 and onwards. The RCF permits the Company to increase the maximum leverage ratio if it consummates or commences certain material transactions.
Under the RCF, as amended, the applicable margin used to calculate the interest rate under the RCF is linked to one sustainability performance target, the number of new regulatory submissions in low and middle-income countries.
Proceeds from borrowings under the RCF can be used for general corporate purposes, including repaying existing debt. As of September 30, 2025, and as of the date of this Quarterly Report on Form
10-Q,
no amounts were outstanding under the RCF. Based on current and forecasted results, the Company expects that it will not exceed the financial covenant thresholds set forth in the RCF within one year from the date the financial statements are issued.
Under specified circumstances, including
non-compliance
with any of the covenants described above and the unavailability of any waiver, amendment or other modification thereto, the Company will not be able to borrow under the RCF. Additionally, violations of the covenants, under the circumstances referred to above, would result in an event of default in all borrowings under the RCF and, when greater than a specified threshold amount as set forth in each series of senior notes and sustainability-linked senior notes is outstanding, could lead to an event of default under the Company’s senior notes and sustainability-linked senior notes due to cross-acceleration provisions.
Teva expects that it will continue to have sufficient cash resources to support its debt service payments and all other financial obligations within one year from the date that the financial statements are issued.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
NOTE 8 – Derivative instruments and hedging activities:

a. | Foreign exchange risk management:

In the first nine months of 2025, approximately 45% of Teva’s revenues were denominated in currencies other than the U.S. dollar. As a result, Teva is subject to significant foreign currency risks.
The Company enters into forward exchange contracts and purchases and writes options in order to hedge the currency exposure on balance sheet items, revenues and expenses. In addition, the Company takes measures to reduce its exposure by using natural hedging. The Company also acts to offset risks in opposite directions among the subsidiaries within Teva. The currency hedged items are usually denominated in the following main currencies: euro, Swiss franc, British pound, Russian ruble, Canadian dollar, Polish złoty, Japanese yen, new Israeli shekel, Indian rupee and other currencies. Depending on market conditions, foreign currency risk is also managed through the use of foreign currency debt.
The Company may choose to hedge against possible fluctuations in foreign subsidiaries net assets (“net investment hedge”) and has entered into cross-currency swaps and forward-contracts in the past in order to hedge such an exposure.
Most of the counterparties to the derivatives are major banks and the Company is monitoring the associated inherent credit risks. The Company enters into derivative transactions for hedging purposes only.

b. | Interest risk management:

The Company raises capital through various debt instruments, including senior notes, sustainability-linked senior notes, bank loans and convertible debentures that bear fixed or variable interest rates, as well as a syndicated sustainability-linked revolving credit facility and securitization programs that bear a variable interest rate. In some cases, the Company has swapped from a fixed to a variable interest rate (“fair value hedge”) and from a fixed to a fixed interest rate with an exchange from a currency other than the functional currency (“cash flow hedge”), thereby reducing overall interest expenses or hedging risks associated with interest rate fluctuations. As of September 30, 2025, all outstanding senior notes, sustainability-linked senior notes and convertible debentures bear a fixed interest rate.

c. | Bifurcated embedded derivatives:

Upon the issuance of its sustainability-linked senior notes, Teva recognized embedded derivatives related to interest rate adjustments and a potential
one-time
premium payment upon failure to achieve certain sustainability performance targets, such as access to medicines in
low-to-middle-income
countries and reduction of absolute greenhouse gas emissions, which were bifurcated and are accounted for separately as derivative financial instruments. As of September 30, 2025, the fair value of these derivative instruments is negligible.

d. | Derivative instruments outstanding:

The following table summarizes the classification and fair values of derivative instruments:

|  | Fair value |  |  | Fair value |
|  | Designated as hedging instruments |  |  | Not designated as hedging instruments |
|  | September 30, 2025 |  |  | December 31, 2024 |  |  | September 30, 2025 |  |  | December 31, 2024 |
Reported under |  | (U.S. $ in millions) |  |  | (U.S. $ in millions) |
Asset derivatives: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Other current assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Option and forward contracts |  | $ | — |  |  | $ | — |  |  | $ | 64 |  |  | $ | 71 |
Liability derivatives: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Other current liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Option and forward contracts |  |  | — |  |  |  | — |  |  |  | (35 | ) |  |  | (24 | )
Other non-current liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cross-currency interest rate swap-cash flow hedge (1) |  |  | (18 | ) |  |  | — |  |  |  | — |  |  |  | — |

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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
The table below provides information regarding the location and amount of
pre-tax
(gains) losses from derivatives designated in cash flow hedging relationships:

|  | Financial expenses, net |  |  | Other comprehensive income (loss) |
|  | Three months ended, |  |  | Three months ended, |
|  | September 30, 2025 |  |  | September 30, 2024 |  |  | September 30, 2025 |  |  | September 30, 2024 |
Reported under |  | (U.S. $ in millions) |
Line items in which effects of hedges are recorded |  | $ | 237 |  |  | $ | 272 |  |  | $ | (44 | ) |  | $ | 180 |
Cross-currency interest rate swap—cash flow hedge (1) |  |  | (4 | ) |  |  | — |  |  |  | (1 | ) |  |  | — |

|  | Financial expenses, net |  |  | Other comprehensive income (loss) |
|  | Nine months ended, |  |  | Nine months ended, |
|  | September 30, 2025 |  |  | September 30, 2024 |  |  | September 30, 2025 |  |  | September 30, 2024 |
|  | (U.S. $ in millions) |
Reported under |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Line items in which effects of hedges are recorded |  | $ | 714 |  |  | $ | 763 |  |  | $ | 700 |  |  | $ | (75 | )
Cross-currency interest rate swap—cash flow hedge (1) |  |  | 12 |  |  |  | (8 | ) |  |  | — |  |  |  | 1 |

The table below provides information regarding the location and amount of
pre-tax
(gains) losses from derivatives not designated as hedging instruments:

|  | Financial expenses, net |  |  | Net revenues |
|  | Three months ended, |  |  | Three months ended, |
|  | September 30, 2025 |  |  | September 30, 2024 |  |  | September 30, 2025 |  |  | September 30, 2024 |
Reported under |  | (U.S. $ in millions) |
Line items in which effects of hedges are recorded |  | $ | 237 |  |  | $ | 272 |  |  | $ | (4,480 | ) |  | $ | (4,332 | )
Option and forward contracts (2) |  |  | 4 |  |  |  | 4 |  |  |  | — |  |  |  | — |
Option and forward contracts economic hedge (3) |  |  | — |  |  |  | — |  |  |  | (9 | ) |  |  | 9 |

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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)

|  | Financial expenses, net |  |  | Net revenues |
|  | Nine months ended, |  |  | Nine months ended, |
|  | September 30, 2025 |  |  | September 30, 2024 |  |  | September 30, 2025 |  |  | September 30, 2024 |
Reported under |  | (U.S. $ in millions) |
Line items in which effects of hedges are recorded |  | $ | 714 |  |  | $ | 763 |  |  | $ | (12,547 | ) |  | $ | (12,315 | )
Option and forward contracts (2) |  |  | 8 |  |  |  | (33 | ) |  |  | — |  |  |  | — |
Option and forward contracts economic hedge (3) |  |  | — |  |  |  | — |  |  |  | 51 |  |  |  | (1 | )

(1) | In May 2025, Teva entered into a $500 million notional amount of fixed to fixed cross-currency interest rate swaps relating to its 5.75% senior notes due 2030 to hedge the foreign currency exchange risk of future principal and interest payments associated with the USD denominated notes. The cross-currency swaps synthetically convert part of the USD debt into CHF, aligning debt servicing costs with Teva’s inflows and reducing economic volatility. These swaps have been designated as cash flow hedges and the gain or loss on these swaps will be reported as a component of other comprehensive income and reclassified into earnings in each period during which the swaps affect earnings in the same line item associated with the USD denominated bonds.

(2) | Teva uses foreign exchange contracts (mainly option and forward contracts) to hedge balance sheet items from currency exposure. These foreign exchange contracts are not designated as hedging instruments for accounting purposes. In connection with these foreign exchange contracts, Teva recognizes gains or losses that offset the revaluation of the balance sheet items also recorded under financial expenses, net.

(3) | Teva entered into option and forward contracts designed to limit the exposure of foreign exchange fluctuations on projected revenues and expenses recorded in euro, Swiss franc, British pound, Russian ruble, Canadian dollar, Polish złoty, new Israeli shekel, Indian rupee and some other currencies to protect its projected operating results for 2025 and 2026. These derivative instruments do not meet the criteria for hedge accounting, however, they are accounted for as an economic hedge. These derivative instruments, which may include hedging transactions of future projected revenues and expenses, are recognized on the balance sheet at their fair value on a quarterly basis, while the foreign exchange impact on the underlying revenues and expenses may occur in subsequent quarters. In the three months ended September 30, 2025, the positive impact from these derivatives recognized under revenues was $9 million. In the three months ended September 30, 2024, the negative impact from these derivatives recognized under revenues was $9 million. In the nine months ended September 30, 2025, the negative impact from these derivatives recognized under revenues was $51 million. In the nine months ended September 30, 2024, the positive impact from these derivatives recognized under revenues was $1 million. Changes in the fair value of the derivative instruments are recognized in the same line item in the statements of income as the underlying exposure being hedged. Cash flows associated with these derivatives are reflected as cash flows from operating activities in the consolidated statements of cash flows.

| e. | Amortizations due to terminated derivative instruments:

Forward-starting interest rate swaps and treasury lock agreements
In 2015, Teva entered into forward-starting interest rate swaps and treasury lock agreements to protect the Company from interest rate fluctuations in connection with a future debt issuance the Company was planning. These forward-starting interest rate swaps and treasury lock agreements were terminated in July 2016 upon the debt issuance. Termination of these transactions resulted in a
loss position
of $493 million, which was recorded as other comprehensive income (loss) and is amortized under financial expenses, net over the life of the debt.
With respect to these forward-starting interest rate swaps and treasury lock agreements, losses of $5 million and $7 million were recognized under financial expenses, net, for each of the three months ended September 30, 2025 and 2024, and losses of $30 million and $21 million were recognized under financial expenses, net, for each of the nine months ended September 30, 2025 and 2024, respectively.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)

| f. | Securitization:

U.S. securitization program
On November 7, 2022, Teva and a bankruptcy-remote special purpose vehicle (“SPV”) entered into an accounts receivable securitization facility (“AR Facility”) with PNC Bank, National Association (“PNC”) with a three-year term. The AR Facility provided for purchases of accounts receivable by PNC in an amount of up to $1 billion through November 2023, and up to $500 million from November 2023 through November 2025. On June 30, 2023, the AR Facility agreement was amended to include an additional receivables purchaser under the agreement, in an amount of up to $250 million through November 2025. As a result, the total commitment of PNC was reduced to an amount of up to $750 million, effective June 30, 2023. Under the terms of the AR facility agreement, in November 2023, the total commitment of PNC was further reduced to an amount of up to $500 million through November 2025. On November 7, 2023, the SPV amended the agreement and increased the commitment amount to a maximum of $1 billion by including an additional receivables purchaser in an amount of up to $250 million through March 2024, which was then reduced by $125 million through November 2025. As a result, the commitment amount was reduced to a maximum of $875 million without any additional purchasers participating in the AR facility. On October 29, 2024, the SPV amended the agreement and increased the commitment amount to a maximum amount of $950 million by an existing receivables purchaser increasing its commitment by $75 million.
It is anticipated that the AR Facility will be extended during November 2025 for an additional three-year term. The commitment amount will remain $950 million.
Pledged accounts receivables
In connection with the U.S. securitization program, accounts receivables, net of allowance for credit losses, include $782 million and $558 million as of September 30, 2025 and December 31, 2024, respectively, which are pledged by the SPV to PNC.

| g. | Supplier Finance Program Obligation

Teva maintains supply chain finance agreements with participating financial institutions. Under these agreements, participating suppliers may voluntarily elect to sell their accounts receivable with Teva to these financial institutions. Teva’s suppliers negotiate their financing agreements directly with the respective financial institutions and Teva is not a party to these agreements. Teva has no economic interest in its suppliers’ decisions to participate in the program and Teva pays the financial institutions the stated amount of confirmed invoices on the maturity dates, which is generally within 120 days from the date the invoice was received. The agreements with the financial institutions do not require Teva to provide assets pledged as security or other forms of guarantees for the supplier finance program. All outstanding amounts related to suppliers participating in the supplier finance program are recorded under accounts payables in Teva’s consolidated balance sheets. As of September 30, 2025 and December 31, 2024, the outstanding
accounts payables
to suppliers
participating in these supplier finance programs were $171 million and $158 million, respectively.
NOTE 9 – Legal settlements and loss contingencies:
In the third quarter of 2025, Teva recorded expenses of $60 million in legal settlements and loss contingencies, compared to expenses of $450 million in the third quarter of 2024. Expenses in the third quarter of 2025 were mainly related to an update to the estimated settlement provision for the opioid cases (mainly the effect of the passage of time on the net present value of the discounted payments). Expenses in the third quarter of 2024 were mainly related to a decision by the European Commission in its antitrust investigation into COPAXONE
®
, and an update to the estimated settlement provision for the opioid cases (mainly related to the settlement agreement with the city of Baltimore and the effect of the passage of time on the net present value of the discounted payments). See note 10.
In the first nine months of 2025, Teva recorded expenses of $312 million in legal settlements and loss contingencies, compared to $638 million in the first nine months of 2024. Expenses in the first nine months of 2025 were mainly related to an update to the estimated settlement provision for the opioid cases (mainly the effect of the passage of time on the net present value of the discounted payments), an update to the estimated provision recorded for the claims brought by attorneys general representing states and territories throughout the United States in the generic drug antitrust litigation, as well as a provision recorded in connection with the antitrust litigation related to QVAR. Expenses in the first nine months of 2024 were mainly related to a decision by the European Commission in its antitrust investigation into COPAXONE, and an update to the estimated settlement provision for the opioid cases (mainly the effect of the passage of time on the net present value of the discounted payments and the settlement agreement with the city of Baltimore).
As of September 30, 2025 and December 31, 2024, Teva’s provision for legal settlements and loss contingencies recorded under accrued expenses and other taxes and long-term liabilities was $4,668 million and $4,881 million, respectively.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
NOTE 10 – Commitments and contingencies:
General
From time to time, Teva and/or its subsidiaries are subject to claims for damages and/or equitable relief arising in the ordinary course of business. In addition, as described below, in large part as a result of the nature of its business, Teva is frequently subject to litigation. Teva generally believes that it has meritorious defenses to the actions brought against it and vigorously pursues the defense or settlement of each such action.
Teva records a provision in its consolidated financial statements to the extent that it concludes that a contingent liability is probable and the amount thereof is reasonably estimable. Based upon the status of the cases described below, management’s assessments of the likelihood of damages, and the advice of legal counsel, no material provision has been made regarding any matter disclosed in this note, except as noted below. Litigation outcomes and contingencies are unpredictable, and substantial damages or other relief may be awarded. Accordingly, management’s assessments involve complex judgments about future events and often rely heavily on estimates and assumptions. Teva continuously reviews the matters described below and may, from time to time, remove previously disclosed matters where the exposures were fully resolved in the prior year, or determined to no longer meet the materiality threshold for disclosure, or were substantially resolved.
If one or more of such proceedings described below were to result in final judgments against Teva, such judgments could be material to its results of operations and cash flows in a given period. In addition, Teva incurs significant legal fees and related expenses in the course of defending its positions even if the facts and circumstances of a particular litigation do not give rise to a provision in the consolidated financial statements.
In connection with third-party agreements, Teva may under certain circumstances be required to indemnify, and may be indemnified by, in unspecified amounts, the parties to such agreements against third-party claims. Among other things, Teva’s agreements with third parties may require Teva to indemnify them, or require them to indemnify Teva, for the costs and damages incurred in connection with product liability claims.
Except as otherwise noted, all of the litigation matters disclosed below involve claims arising in the United States. Except as otherwise noted, all third-party sales figures given below are based on IQVIA data.
Intellectual Property Litigation
From time to time, Teva seeks to develop generic and biosimilar versions of patent-protected pharmaceuticals and biopharmaceuticals for sale prior to patent expiration in various markets. In the United States, to obtain approval for most generics prior to the expiration of the originator’s patents, Teva must challenge the patents under the procedures set forth in the Hatch-Waxman Act of 1984, as amended. For many biosimilar products that are covered by patents, Teva participates in the “patent dance” procedures of the Biologics Price Competition and Innovation Act (“BPCIA”), which allow for the challenge to originator patents prior to obtaining biosimilar product approval. To the extent that Teva seeks to utilize such patent challenge procedures, Teva is and expects to be involved in patent litigation regarding the validity, enforceability or infringement of the originator’s patents. Teva may also be involved in patent litigation involving the extent to which its product or manufacturing process techniques may infringe other originator or third-party patents.
Additionally, depending upon a complex analysis of a variety of legal and commercial factors, Teva may, in certain circumstances, elect to market a generic or biosimilar version of the product even though litigation is still pending. To the extent Teva elects to proceed in this manner, it could face substantial liability for patent infringement if the final court decision is adverse to Teva, which could be material to its results of operations and cash flows in a given period.
Teva could also be sued for patent infringement outside the context of the Hatch-Waxman Act or BPCIA. For example, Teva could be sued for patent infringement after commencing sales of a product. This type of litigation can involve any of Teva’s pharmaceutical products, not just its generic and biosimilar products.
The general rule for damages in patent infringement cases in the United States is that the patentee should be compensated by no less than a reasonable royalty and it may also be able, in certain circumstances, to be compensated for its lost profits. The amount of a reasonable royalty award would generally be calculated based on the sales of Teva’s product. The amount of lost profits would generally be based on the lost sales of the patentee’s product. In addition, the patentee may seek consequential damages as well as enhanced damages of up to three times the profits lost by the patent holder for willful infringement, although courts have typically awarded much lower multiples.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
Teva is also involved in litigation regarding patents in other countries where it does business, particularly in Europe. The laws concerning generic pharmaceuticals and patents differ from country to country. Damages for patent infringement in Europe may include lost profits or a reasonable royalty, but enhanced damages for willful infringement are generally not available.
In July 2014, GlaxoSmithKline (“GSK”) filed claims against Teva in the U.S. District Court for the District of Delaware for infringement of a patent directed to using carvedilol in a specified manner to decrease the risk of mortality in patients with congestive heart failure. Teva began selling its carvedilol tablets (the generic version of GSK’s Coreg
®
) in September 2007. A jury returned a verdict in GSK’s favor, which was initially overturned by the U.S. District Court for the District of Delaware. The Court of Appeals for the Federal Circuit reinstated the $235.5 million jury verdict, not including pre- or post-judgment interest, finding Teva liable for patent infringement. The U.S. Supreme Court denied Teva’s appeal for a rehearing. On December 12, 2024, the U.S. District Court for the District of Delaware set a schedule for briefing on legal issues that remain in the case, and the briefings were completed on March 26, 2025. In addition to those legal issues, there will need to be a trial regarding certain equitable issues that were never presented in the 2017 jury trial. Teva recognized a provision based on its offer to settle the matter.
Product Liability Litigation
Teva’s business inherently exposes it to potential product liability claims. Teva maintains a program of insurance, which may include commercial insurance, self-insurance (including direct risk retention), or a combination of both types of insurance, in amounts and on terms that it believes are reasonable and prudent in light of its business and related risks. However, Teva sells, and will continue to sell, pharmaceuticals that are not covered by its product liability insurance; in addition, it may be subject to claims for which insurance coverage is denied, as well as claims that exceed its policy limits. Product liability coverage for pharmaceutical companies is becoming more expensive and increasingly difficult to obtain. As a result, Teva may not be able to obtain the type and amount of insurance it desires, or any insurance on reasonable terms, in certain or all of its markets.
Since July 2018, Teva and its subsidiaries have been parties to litigation relating to previously unknown nitrosamine impurities discovered in certain products. The nitrosamine impurities were allegedly found in the active pharmaceutical ingredient (“API”) supplied to Teva by multiple API manufacturers. Subsequently, Teva initiated recalls of losartan in April 2019 and metformin in June 2020, due to the presence of nitrosamine impurities.
Nitrosamine litigations remain pending in the United States related to Teva’s valsartan, losartan, metformin and ranitidine products. There are currently two Multi-District Litigations (“MDL”) pending against Teva and other manufacturers, including one MDL in the U.S. District Court for the District of New Jersey with respect to Teva’s valsartan and losartan products, and another MDL in the U.S. District Court for the Southern District of Florida related to Teva’s ranitidine products.
The claims against Teva and other generic manufacturers in the ranitidine MDL have been dismissed on preemption and other grounds, and are currently on appeal in the Eleventh Circuit Court of Appeals. Teva was dismissed from all ranitidine claims pending in Illinois based on preemption grounds, which plaintiffs have appealed. State court ranitidine cases naming Teva are also pending in coordinated proceedings in California and Pennsylvania.
The trial in the valsartan MDL has been postponed indefinitely, and discovery is paused indefinitely in the MDL with respect to the losartan claims against Teva.
Certain generic manufacturers, including Teva, have also been named in a small number of state court actions brought by single plaintiffs asserting allegations similar to those in the aforementioned valsartan MDL. All of these state court matters have been stayed, aside from a single case pending in New Jersey. Similar lawsuits are pending in Canada.
Teva was also named in a consolidated proceeding pending in the U.S. District Court for the District of New Jersey brought by individuals and end payors seeking economic damages on behalf of purported classes of consumers and end payors who purchased Teva’s and other generic manufacturers’ metformin products. In December 2024, Teva reached a settlement on this matter that resolved all of the plaintiffs’ claims against Teva and the settlement agreement is awaiting court approval.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
Competition Matters
As part of its generic pharmaceuticals business, Teva has challenged a number of patents covering branded pharmaceuticals, some of which are among the most widely-prescribed and well-known drugs on the market. Many of Teva’s patent challenges have resulted in litigation relating to Teva’s attempts to market generic versions of such pharmaceuticals under the federal Hatch-Waxman Act. Some of this litigation has been resolved through settlement agreements in which Teva obtained a license to market a generic version of the drug, often years before the patents expire.
Teva and its subsidiaries have been named as defendants in cases that allege antitrust violations arising from such settlement agreements. The plaintiffs in these cases are usually direct and indirect purchasers of pharmaceutical products, some of whom assert claims on behalf of classes of all direct and indirect purchasers, and they typically allege that (i) Teva received something of value from the innovator in exchange for an agreement to delay generic entry, and (ii) significant savings could have been realized if there had been no settlement agreement and generic competition had commenced earlier. These plaintiffs seek various forms of injunctive and monetary relief, including damages based on the difference between the brand price and what the generic price allegedly would have been and disgorgement of profits, which are often automatically tripled under the relevant statutes, plus attorneys’ fees and costs. The alleged damages generally depend on the size of the branded market and the length of the alleged delay, and can be substantial, potentially measured in multiples of the annual brand sales, particularly where the alleged delays are lengthy or branded drugs with annual sales in the billions of dollars are involved.
Teva believes that its settlement agreements are lawful and serve to increase competition, and has defended them vigorously. In Teva’s experience to date, these cases have typically settled for a fraction of the high end of the damages sought, although there can be no assurance that such outcomes will continue.
In June 2013, the U.S. Supreme Court held, in Federal Trade Commission (“FTC”) v. Actavis, Inc., that a rule of reason test should be applied in analyzing whether such settlements potentially violate the federal antitrust laws. The Supreme Court held that a trial court must analyze each agreement in its entirety in order to determine whether it violates the U.S. antitrust laws. This test has resulted in increased scrutiny of Teva’s patent settlements, additional action by the FTC and state and local authorities, and an increased risk of liability in Teva’s currently pending antitrust litigations.
In December 2011, three groups of plaintiffs filed claims against Wyeth and Teva for alleged violations of the U.S. antitrust laws in connection with their November 2005 settlement of patent litigation involving extended-release venlafaxine (generic Effexor XR
®
). The cases were filed by a purported class of direct purchasers, a purported class of indirect purchasers and certain chain pharmacies in the U.S. District Court for the District of New Jersey. The plaintiffs claim that the settlement agreement between Wyeth and Teva unlawfully delayed generic entry. On August 19, 2025, the district court approved a settlement agreement between Teva and one group of plaintiffs (the indirect purchaser plaintiffs), while the case is proceeding with respect to the other plaintiffs. Annual sales of Effexor XR
®
were approximately $2.6 billion at the time of settlement and at the time Teva launched its generic version of Effexor XR
®
in July 2010.
In February 2012, two purported classes of direct-purchaser plaintiffs filed claims against GSK and Teva in the U.S. District Court for the District of New Jersey for alleged violations of the antitrust laws in connection with their February 2005 settlement of patent litigation involving lamotrigine (generic Lamictal
®
). The plaintiffs claimed that the settlement agreement unlawfully delayed generic entry and sought unspecified damages. In February 2023, a number of direct purchasers who were denied class certification filed suit as individual plaintiffs, which action was transferred to the U.S. District Court for the District of New Jersey. Discovery of the newly added individual plaintiffs is ongoing. Annual sales of Lamictal
®
were approximately $950 million at the time of the settlement and approximately $2.3 billion at the time Teva launched its generic version of Lamictal
®
in July 2008.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
In April 2013, purported classes of direct purchasers of, and end payers for, Niaspan
®
(extended-release niacin) filed claims against Teva and Abbott for violating the antitrust laws by entering into a settlement agreement in April 2005 to resolve patent litigation over the product. A multidistrict litigation has been established in the U.S. District Court for the Eastern District of Pennsylvania. Throughout 2015 and in January 2016, several individual direct-purchaser
opt-out
plaintiffs filed complaints with allegations nearly identical to those of the direct purchasers’ class. On April 24, 2023, the U.S. District Court’s denial of the indirect purchasers’ motion for class certification was affirmed by the Court of Appeals for the Third Circuit, and on June 5, 2023, the Court of Appeals denied the indirect purchasers’ petition for
re-hearing.
The litigation remains ongoing. In October 2016, the District Attorney for Orange County, California, filed a similar complaint in California state court, alleging violations of state law and seeking restitution and civil penalties. The California state court case remains stayed. Annual sales of Niaspan
®
were approximately $416 million at the time of the settlement and approximately $1.1 billion at the time Teva launched its generic version of Niaspan
®
in September 2013.
In November 2020, the European Commission issued a final decision in its proceedings against both Cephalon and Teva, finding that the 2005 settlement agreement between the parties hindered the entry of generic modafinil and imposed fines totaling euro 60.5 million on Teva and Cephalon, potentially subject to post-decision interest. Teva and Cephalon filed an appeal against the decision in February 2021, and a judgment was issued on October 18, 2023 rejecting Teva’s appeal. A provision for this matter was included in the financial statements. In lieu of posting a cash bond, Teva provided the European Commission with a bank guarantee in the amount of the imposed fines, plus post-decision interest. On January 4, 2024, Teva appealed the October 2023 judgment to the European Court of Justice, and on October 23, 2025, the European Court of Justice issued its judgment, dismissing Teva’s appeal.
Between September 2021 and April 2022, several private plaintiffs including retailers and health insurance providers filed claims in various courts against Teva and certain other defendants related to various medicines used to treat HIV, which were all removed and/or consolidated into the U.S. District Court for the Northern District of California. As they relate to Teva, the lawsuits challenged settlement agreements Teva entered into with Gilead in 2013 and/or 2014 to resolve patent litigation relating to Teva’s generic versions of Viread
®
and/or Truvada
®
and Atripla
®
, although plaintiffs abandoned any claim for damages relating to the Viread
®
settlement. In May 2023, Teva and Gilead reached a settlement agreement with the retailer plaintiffs and Teva recognized a provision for this matter based on such settlement. On June 30, 2023, the jury in the trial against the remaining plaintiffs issued a verdict in favor of Teva and Gilead, rejecting all of the remaining plaintiffs’ claims. On February 12, 2024, the court entered a judgment consistent with the jury verdict as to all claims against Teva. The plaintiffs appealed to the U.S. Court of Appeals for the Ninth Circuit, and oral argument on the appeal occurred on October 9, 2025. A decision remains pending. Annual sales in the United States at the time of the settlement of Viread
®
, Truvada
®
and Atripla
®
were approximately $582 million, $2.4 billion, and $2.9 billion, respectively. Annual sales in the United States at the time Teva launched its generic version of Viread
®
in 2017, Truvada
®
in 2020 and Atripla
®
in 2020 were approximately $728 million, $2.1 billion and $444 million, respectively.
In March 2021, the European Commission opened a formal antitrust investigation to assess whether Teva may have abused a dominant position by delaying the market entry and uptake of medicines that compete with COPAXONE, and in October 2022, the European Commission issued its preliminary allegations that Teva had engaged in anti-competitive practices. On October 31, 2024, the European Commission announced its final decision, alleging that Teva had abused a dominant position in certain European member states by (i) filing and withdrawing certain divisional patents, and (ii) raising concerns about competitors’
follow-on
versions of COPAXONE. The decision also includes a fine of euro 462.6 million, potentially subject to post-decision interest. Teva filed an appeal against the decision with the General Court of the European Union in January 2025, and that appeal remains pending. In accordance with Accounting Standards Codification 450 “Accounting for Contingencies,” Teva recognized a provision in its financial statements in the third quarter of 2024, based on management’s current best estimate of the outcome within a range of outcomes for the final resolution of this case. Teva has provided the European Commission with surety underwritten guarantees in an amount of euro 462.6 million, together with specified post-decision interest, to cover the fine amount. Certain generic competitors in Europe have also brought similar antitrust claims against Teva in Germany and the Netherlands, which have been stayed. Teva could face additional claims from generic competitors, payors, or other private plaintiffs in Europe related to this matter.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
On June 29, 2021, Mylan Pharmaceuticals (“Mylan”) filed claims against Teva in the U.S. District Court for the District of New Jersey. On March 11, 2022 and March 15, 2022, purported purchasers of COPAXONE filed claims against Teva in the U.S. District Court for the District of New Jersey on behalf of themselves and similarly situated direct and indirect purchasers of COPAXONE. On August 22, 2022, additional purported purchasers of COPAXONE sued Teva in the U.S. District Court for the District of Vermont on behalf of themselves and similarly situated indirect purchasers of COPAXONE. The complaints variously assert claims for alleged violations of the Lanham Act, state and federal unfair competition and monopolization laws, tortious interference, trade libel, and a violation of the Racketeer Influenced and Corrupt Organizations Act (“RICO Act”). Additionally, plaintiffs claim Teva was involved in an unlawful scheme to delay and hinder generic competition concerning COPAXONE sales. Plaintiffs seek damages for lost profits and expenses, disgorgement, restitution, treble damages, attorneys’ fees and costs, and injunctive relief. Teva moved to dismiss all of the complaints, and on January 22, 2024, Teva’s motion to dismiss the complaint in the District of Vermont was granted as to certain state law claims but was otherwise denied. On February 27, 2025, the Special Master in the District of New Jersey (the “Special Master”) issued reports and recommendations on Teva’s motions to dismiss the direct purchaser plaintiffs’ (“DPP”) complaint and the Mylan complaint, recommending dismissal of several aspects of the plaintiffs’ respective claims and allowing others to proceed. Mylan filed an objection with the District Court to certain of the Special Master’s recommendations for dismissal. The objection remains pending. On May 30, 2025, the DPPs filed an amended complaint, which drops its class allegations and adds several new direct purchaser plaintiffs. Teva submitted its renewed motion to dismiss certain of DPPs’ allegations to the Special Master for resolution, which is fully briefed and remains pending. On August 7, 2025, the Special Master issued a report and recommendation on Teva’s motion to dismiss the indirect purchasers’ complaint, recommending dismissal of several aspects of the plaintiffs’ claims and allowing others to proceed. On April 3, 2025, Walgreen Co., The Kroger Co., Albertsons Companies, Inc., and
H-E-B,
L.P. (“Retailers”), as
opt-outs
of the purported DPP class in the District of New Jersey, filed a complaint against Teva in the District of Vermont alleging claims similar to those filed by other plaintiffs and asserting a claim under the Sherman Act. On September 24, 2025, the Vermont court granted Teva’s motion to transfer the Retailers’ case to the District of New Jersey.
On July 15, 2021, the U.K. Competition and Markets Authority (“CMA”) issued a decision imposing fines for breaches of U.K. competition law by Allergan, Actavis UK, Auden Mckenzie and a number of other companies in connection with the supply of 10mg and 20mg hydrocortisone tablets in the U.K. The decision combines the CMA’s three prior investigations into the supply of hydrocortisone tablets in the U.K., as well as the CMA’s subsequent investigation relating to an alleged anticompetitive agreement with Waymade. On January 9, 2017, Teva completed the sale of Actavis UK to Accord Healthcare Limited, in connection with which Teva agreed to indemnify Accord Healthcare for potential fines imposed by the CMA and/or damages awarded by a court against Actavis UK in relation to two of the three statements of objection from the CMA (dated December 16, 2016 and March 3, 2017), and resulting from conduct prior to the closing date of the sale. In addition, following Teva’s acquisition of the Actavis generics business from Allergan, Teva agreed to indemnify Allergan against losses arising from this matter in the event of any such fines or damages. On October 6, 2021, Accord UK (previously Actavis UK) and Auden Mckenzie appealed to the U.K. Competition Appeal Tribunal (the “Tribunal”) the CMA’s decisions that the prices of hydrocortisone were unfair and excessive and that the agreements amounted to infringements of the U.K.’s Competition Act as
so-called
pay-for-delay
arrangements. The hearing for the appeal concluded in the first quarter of 2023, with partial judgments handed down by the Tribunal on September 18, 2023 (judgment on unfair pricing), March 8, 2024 (judgments on
pay-for-delay
and due process) and April 29, 2024 (judgment on fines). On September 6, 2024, the U.K. Court of Appeal overturned the Tribunal’s judgment on due process and, as a result, the Tribunal will consider and issue a further judgment on fines. Accord UK and Auden Mckenzie requested permission to appeal the U.K. Court of Appeal’s ruling (overturning the Tribunal’s judgment on due process) to the U.K. Supreme Court, but that request was denied in January 2025. In March 2025, the Tribunal gave Accord UK and Auden Mckenzie permission to appeal to the Court of Appeal certain other issues relating to unfair pricing and fines. Those appeals have been filed and remain pending. A provision for the estimated exposure for Teva related to the fines and/or damages has been recorded in the financial statements.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
In November 2022, two complaints filed by plaintiffs purporting to represent retailer purchasers and a putative class of
end-payor
purchasers were filed in the U.S. District Court for the District of New Jersey against Teva and its marketing partner, Natco Pharma Limited (“Natco”), alleging violations of the antitrust laws in connection with their December 2015 settlement of patent litigation with Celgene Corporation (which was subsequently acquired by BMS) involving the drug Revlimid
®
(lenalidomide). The complaints also name Celgene and BMS as defendants. On January 24, 2023, the complaints were consolidated for
pre-trial
purposes only with an earlier-filed, already consolidated action filed against BMS and Celgene. On February 16, 2023, plaintiffs filed amended complaints adding additional plaintiffs. Additionally, on October 6, 2023, two individual payor plaintiffs brought claims similar to those described above in the U.S. District Court for the Northern District of California, which were consolidated with the pending consolidated actions and transferred to the U.S. District Court for the District of New Jersey. On June 6, 2024, the court granted in full Celgene’s motion to dismiss the Insurer
Opt-Out
Action, but allowed plaintiffs leave to amend most of their claims. The court had previously administratively terminated Teva’s, Natco’s, and Celgene’s motions to dismiss the retailer and
end-payor
complaints pending the decision on the Insurer Opt-Out Action. On August 5, 2024, plaintiffs filed amended complaints to which the defendants subsequently filed motions to dismiss, which remain pending. On December 16, 2024, five individual Insurer Opt Out plaintiffs, each of whom had added Teva and Natco as defendants in the Insurer Amended Complaint filed on August 5, 2024, filed new standalone complaints adding no new substantive allegations and naming Teva, Natco and others as defendants. Annual sales of Revlimid
®
in the United States were approximately $3.5 billion at the time of the settlement.
On December 2, 2022, plaintiffs purporting to represent putative classes of indirect purchasers of EpiPen
®
(epinephrine injection) and NUVIGIL
®
(armodafinil) filed a complaint in the U.S. District Court for the District of Kansas against Teva, Cephalon, and a former Teva executive. Teva owns the New Drug Application (“NDA”) for NUVIGIL and sold the brand product, for which generic entry occurred in 2016. Teva filed an Abbreviated New Drug Application (“ANDA”) to sell generic EpiPen
®
, which Teva launched in 2018 following receipt of FDA approval. The complaint alleges, among other things, that the defendants violated federal antitrust laws, the RICO Act, and various state laws in connection with settlements resolving patent litigation relating to those products. Plaintiffs seek injunctive relief, compensatory and punitive damages, interest, attorneys’ fees and costs. On September 26, 2023, plaintiffs filed a brief in which plaintiffs limited their claims only to those relating to the alleged delay of generic NUVIGIL. On March 26, 2024, the court dismissed plaintiffs’ RICO claims and certain state law claims but denied Teva’s motion to dismiss plaintiffs’ antitrust claims. On June 14, 2024, the court entered orders bifurcating discovery and limiting the first phase to the question of the timeliness of plaintiffs’ claims. Substantially similar complaints were filed in the U.S. District Courts for the Central District of California and the Eastern District of New York on June 19, and June 23, 2025, respectively. On July 28, 2025, the Eastern District of New York court granted a motion filed by Teva to transfer the case to the District of Kansas, and a second motion to transfer remains pending in the Central District of California. Annual sales of NUVIGIL in the United States were approximately
$
300
million at the time Teva entered into the first settlement with an ANDA filer in
2012
.
In May 2023, certain
end-payor
plaintiffs filed putative class action complaints in the U.S. District Court for the District of Massachusetts against Teva and a number of its affiliates, alleging that Teva engaged in anticompetitive conduct to suppress generic competition to its branded QVAR asthma inhalers in violation of state and federal antitrust laws and state consumer protection laws. The court dismissed plaintiffs’ claim that Teva had engaged in “sham litigation” and certain of plaintiffs’ state antitrust and consumer protection claims, but permitted the case to proceed on the remainder of plaintiffs’ allegations. In the second quarter of 2025, Teva recognized a provision for this matter. On August 4, 2025, the parties informed the court that they had reached a settlement in principle, and the settlement was subsequently filed and is awaiting preliminary approval by the Court.
In September and October 2025, private plaintiffs representing (1) a putative class of
end-payor
purchasers, (2) a putative class of direct purchasers; and (3) Walgreen Co., The Kroger Co., Albertsons Companies, Inc., HEB, L.P., and Supervalue, Inc., filed complaints in the United States District Court for the District of Rhode Island against Bausch Health Companies Inc., Teva, and their related entities. The complaints allege violations of the antitrust laws and various state laws in connection with the companies’ September 2018 settlement of patent litigation concerning the drug Xifaxan
®
(rifaximin). Plaintiffs seek declaratory and injunctive relief, treble damages, attorneys’ fees, and costs of suit. Annual sales of Xifaxan
®
were approximately $1.5 billion at the time of the settlement.
Government Investigations and Litigation Relating to Pricing and Marketing
Teva is involved in government investigations and litigation arising from the marketing and promotion of its pharmaceutical products in the United States.
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Notes to Consolidated Financial Statements
(Unaudited)
In 2015 and 2016, Actavis and Teva USA each respectively received subpoenas from the U.S. Department of Justice (“DOJ”) Antitrust Division seeking documents and other information relating to the marketing and pricing of certain Teva USA generic products and communications with competitors about such products. On August 25, 2020, a federal grand jury in the Eastern District of Pennsylvania returned a
three-count
indictment charging Teva USA with criminal felony Sherman Act violations. On August 21, 2023, Teva USA entered into a
3-year
deferred prosecution agreement (“DPA”) with the DOJ. Under the terms of the DPA, Teva USA: (i) admitted to violating the antitrust laws by agreeing with competitors, in three instances between 2013 and 2015 involving three separate customers, not to bid on an opportunity to supply a customer with a particular generic product (in the first instance pravastatin, in the second clotrimazole, and in the third tobramycin); (ii) agreed to divest the pravastatin that it sells in the United States to a third-party buyer; (iii) agreed to donate $50 million worth of clotrimazole and tobramycin, valued at wholesale acquisition cost (“WAC”), to humanitarian organizations over five years; and (iv) agreed to pay a fine in the amount of $
225
million over 5 years, with $22.5 million due each year from 2024 through 2027, and $135 million due in 2028. Teva recognized a provision for the resolution of this case and divested pravastatin in November 2024 pursuant to the DPA.
In May 2018, Teva received a civil investigative demand from the DOJ Civil Division pursuant to its investigation concerning allegations that generic pharmaceutical manufacturers, including Teva, engaged in market allocation and/or price-fixing agreements, paid illegal remuneration, and caused false claims to be submitted in violation of the False Claims Act. On October 10, 2024, Teva entered into a settlement agreement with the Civil Division to resolve these allegations. Under the terms of the settlement, which includes no admission of wrongdoing, Teva is required to pay $25 million, consisting of $10 million that was paid in the fourth quarter of 2024 and $15 million that will be paid in 2025. Teva has recognized a provision for the resolution of this matter.
In 2015 and 2016, Actavis and Teva USA each respectively received a subpoena from the Connecticut Attorney General seeking documents and other information relating to potential state antitrust law violations. On December 15, 2016, and as subsequently amended, a civil action was brought by the attorneys general of 49 states, as well as the District of Columbia and Puerto Rico, which includes claims against both Actavis and Teva. On May 10, 2019, and as subsequently amended, most of these attorneys general filed another antitrust complaint against Actavis, Teva and other companies and individuals alleging that Teva was at the center of a conspiracy in the generic pharmaceutical industry and asserting that Teva and others allegedly fixed prices, rigged bids, and allocated customers and market share with respect to certain products. The second complaint was amended on November 22, 2024, to add California as a plaintiff as well as to add additional defendants. On June 10, 2020, most of the same states, with the addition of the U.S. Virgin Islands, filed a separate, third complaint in the U.S. District Court for the District of Connecticut naming, among other defendants, Actavis, in a similar complaint relating to dermatological generic products, and that complaint was later amended to, among other things, add California as a plaintiff.
For the complaints described above, which also include claims against certain former employees of Actavis and Teva USA, the states seek a finding that the defendants’ actions violated federal antitrust law and state antitrust and consumer protection laws, as well as injunctive relief, disgorgement, damages on behalf of various state and governmental entities and consumers, civil penalties and costs. In April 2024, all three of the attorneys general’s lawsuits were transferred back to the U.S. District Court for the District of Connecticut where they were originally filed. The court has adopted a schedule for summary judgment in the attorneys general’s third complaint pursuant to which multiple groups of motions were filed during 2025. Fact discovery in the first and second complaints was completed in July 2025.
In addition, for the complaints described above, Teva has settled with the states of Mississippi (in June 2021), Louisiana (in March 2022), Georgia (in September 2022), Arkansas (in October 2022), Florida (in February 2023), Kentucky (in June 2023), South Dakota (in June 2024), and New Mexico (in June 2024). Teva paid each state an amount proportional to its share of the national population (approximately $1,000,000 for each 1% share of the national population), and such states have dismissed their claims against Actavis and Teva USA, as well as certain former employees of Actavis and Teva USA, pursuant to these settlements. These settlements, in addition to the status of negotiations with several other U.S. state attorneys general to settle on comparable terms, caused management to consider settlement of the claims filed by the remaining attorneys general to be probable, and management recorded an estimated provision in the third quarter of 2022. In the second quarter of 2025, Teva updated the provision based on recent developments in its ongoing negotiations with certain remaining U.S. state attorneys general. The States of Alabama (in March 2022) and Hawaii (in August 2023) and the territories of American Samoa (in July 2020) and Guam (in February 2023) have all voluntarily dismissed all of their claims in the litigation against Actavis and Teva USA. The dismissals by Alabama, Hawaii and Guam were with prejudice and the dismissal by American Samoa was without prejudice.
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Notes to Consolidated Financial Statements
(Unaudited)
Beginning on March 2, 2016, and through June 2025, numerous complaints have been filed in the United States on behalf of putative classes of direct and indirect purchasers of several generic drug products, as well as several individual direct and indirect purchaser
opt-out
plaintiffs, including most recently a complaint filed by an indirect opt out plaintiff on June 9, 2025. All such complaints have been transferred to the generic drug multidistrict litigation in the Eastern District of Pennsylvania (“Pennsylvania MDL”). These complaints have been brought against various manufacturer defendants, including Teva USA and Actavis, alleging that these defendants engaged in conspiracies to fix prices and/or allocate market share of generic products, and generally seeking injunctive relief and damages under federal antitrust law, as well as damages under various state laws. With limited exceptions, all fact discovery in the Pennsylvania MDL is scheduled to be completed in December 2025. The Pennsylvania MDL court had proposed holding a bellwether trial on a single drug, starting in August 2025, in a case in which Actavis (but not Teva) is a defendant. However on June 17, 2025, the United States Court of Appeals for the Third Circuit gave defendants permission to immediately appeal the District Court’s prior grants of class certification as to the bellwether trial on that single drug, and the Pennsylvania MDL court thereafter stayed the trial in the bellwether case against Actavis, in light of that Third Circuit ruling. The Pennsylvania MDL court has since selected two additional bellwethers: Humana Inc.’s (“Humana”) indirect
opt-out
case, involving claims on various drugs, and a case filed by a putative class of indirect reseller plaintiffs (“IRPs”) involving claims on a single drug (pravastatin). Under the current case schedule, the Humana bellwether case is set for trial starting in September 2026, and the IRP bellwether case is set for trial starting in December 2026.
From 2019 to 2021, certain individual plaintiffs commenced civil actions in the Pennsylvania Court of Common Pleas of Philadelphia County against many of the defendants in the Pennsylvania MDL, including Teva and Actavis. Following defendants’ request, the cases filed in the Court of Common Pleas of Philadelphia County have all been placed in deferred status. One plaintiff, Aetna Inc., filed a complaint in Connecticut state court on December 30, 2024. Certain counties in New York and Texas have also commenced civil actions against many of the defendants in the Pennsylvania MDL, including Teva and Actavis, and the complaints have been transferred to the Pennsylvania MDL. On March 14, 2025 and June 9, 2025, respectively, Walmart Inc. and Southwest Airlines, Inc. filed lawsuits against various manufacturers, including Teva and Actavis, in the Eastern District of Pennsylvania which has been transferred to the Pennsylvania MDL. On May 19, 2025, New York Quality Healthcare Corporation filed a lawsuit against various manufacturers, including Teva and Actavis, in New York Supreme Court, County of New York.
There is also one similar complaint brought in Canada, which is in its early stages and alleges that the defendants engaged in conspiracies to fix prices and/or allocate market share of generic drug products to the detriment of a class of private payors. The court held a class certification hearing in October 2025 and a decision remains pending.
In March 2017, Teva received a subpoena from the U.S. Attorney’s office in Boston, Massachusetts requesting documents related to Teva’s donations to patient assistance programs. In August 2020, the U.S. Attorney’s office in Boston, Massachusetts brought a civil action in the U.S. District Court for the District of Massachusetts alleging causes of action under the federal False Claims Act and for unjust enrichment (the “DOJ PAP Complaint”). It was alleged that Teva’s donations to certain 501(c)(3) charities that provided financial assistance to multiple sclerosis patients violated the Anti-Kickback Statute. On October 10, 2024, Teva entered into a settlement agreement with the DOJ to resolve these claims. Under the terms of the settlement, which includes no admission of wrongdoing, Teva is required to pay $425 million over 6 years – $19 million was paid in the fourth quarter of 2024, $34 million will be paid in 2025, $49 million will be paid in each of 2026 and 2027, $99 million will be paid in 2028, and $175 million will be paid in 2029. The case was dismissed with prejudice on November 19, 2024. Teva has recognized a provision for the resolution of this case. Additionally, on January 8, 2021, Humana filed an action against Teva in the U.S. District Court for the Middle District of Florida based on the allegations raised in the DOJ PAP Complaint. On April 29, 2025, the court granted Teva’s motion to dismiss. On May 28, 2025, Humana
re-filed
the case in Kentucky circuit court, alleging the same facts alleged in the Florida district court action. On July 29, 2025, Teva filed a motion to dismiss, which remains pending. On November 17, 2022, United Healthcare filed an action against Teva in the U.S. District Court for the District of New Jersey based on the conduct alleged in the DOJ PAP Complaint, followed by an amended complaint filed on February 29, 2024. On March 28, 2025, Teva moved for summary judgment limited to the statute of limitations defense as per the court’s order, and that motion is pending.
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Notes to Consolidated Financial Statements
(Unaudited)
In April 2021, a city and county in Washington filed claims against Teva in the U.S. District Court for the Western District of Washington for alleged violations of the RICO Act, Washington’s Consumer Protection Act, and unjust enrichment concerning Teva’s sale of COPAXONE. Plaintiffs purport to represent a nationwide class of health plans and a subclass of Washington-based health plans that purchased and/or reimbursed health plan members for COPAXONE. Plaintiffs allege that Teva engaged in several fraudulent schemes that resulted in plaintiffs and the putative class members purchasing and/or reimbursing plan members for additional prescriptions of COPAXONE and/or at inflated COPAXONE prices. Plaintiffs seek treble damages for the excess reimbursements and inflated costs, as well as injunctive relief. On November 17, 2021, Teva moved to dismiss the suit, on the grounds that plaintiffs’ claims are barred by the applicable statutes of limitations and the direct purchaser rule, suffer from jurisdictional defects, and fail to plausibly allege fraud or other elements of their claims. On March 9, 2023, the court held a hearing on the motion to dismiss, and a decision remains pending. On June 27, 2025, Teva filed a motion to lift the stay of discovery. That motion is fully briefed and remains pending.
On December 1, 2022, Teva received a civil subpoena from the U.S. Attorney’s office in Boston, Massachusetts requesting certain documents related to the sale and marketing of AUSTEDO
®
and risperidone LAI. Teva is cooperating with the request for documents and information.
In June 2024, Teva received a civil investigative demand from the Federal Trade Commission (“FTC”) seeking documents and information regarding an investigation related to patents listed in the Food and Drug Administration’s Approved Drug Products with Therapeutic Equivalence Evaluations publication (“Orange Book”) in connection with certain inhaler products. Teva is cooperating with the request for documents and information.
On October 1, 2024, Teva received a civil investigative demand from the U.S. Attorney’s office in Boston, Massachusetts and the Civil Division of the Department of Justice requesting certain documents and information related to the manufacturing practices at its former manufacturing facility in Irvine, California, which Teva closed in 2022. Teva is cooperating with the request for documents and information.
Opioids Litigation
Since May 2014, more than 3,500 complaints have been filed by various governmental agencies and private plaintiffs in U.S. state and federal courts with respect to opioid sales and distribution against various Teva affiliates and several other pharmaceutical companies, the vast majority of which have been resolved. Cases brought by third party payers, both as individual cases and as class actions, remain. The majority of the remaining cases are consolidated in the multidistrict litigation in the Northern District of Ohio (the “MDL Opioid Proceeding”). These cases assert claims under similar provisions of different state laws and generally allege that the defendants engaged in improper marketing and distribution of Teva’s branded opioids, including ACTIQ
®
and FENTORA
®
, and also assert claims related to Teva’s generic opioid products.
In addition, over 950 personal injury plaintiffs, including various putative class actions of individuals, have asserted personal injury and wrongful death claims in over 600 complaints, nearly all of which are consolidated in the MDL Opioid Proceeding. Furthermore, approximately 100 personal injury complaints allege that Anda (in addition to naming other distributors and manufacturers) failed to develop and implement systems sufficient to identify suspicious orders of opioid products and prevent their abuse and diversion. Plaintiffs seek a variety of remedies, including restitution, civil penalties, disgorgement of profits, treble damages,
non-economic
damages, attorneys’ fees and injunctive relief. Certain plaintiffs seek damages for all costs associated with addressing the abuse of opioids and opioid addiction and certain plaintiffs specify multiple billions of dollars in the aggregate as alleged damages. In many of these cases, plaintiffs are seeking joint and several damages among all defendants. All but a handful of these cases are stayed in the MDL Opioid Proceedings.
In June 2023, Teva finalized and fully resolved its nationwide settlement agreement with the states and litigating subdivisions. Under the financial terms of the nationwide settlement agreement with the states and subdivisions, Teva will pay up to $4.25 billion (including the already settled cases), spread over 13 years. This total includes the supply of up to $1.2 billion of Teva’s generic version of Narcan
®
(naloxone hydrochloride nasal spray), valued at wholesale acquisition cost, over 10 years or cash at 20% of the wholesale acquisition cost ($240 million) in lieu of product. In September 2024, Teva reached and finalized an agreement with the City of Baltimore to settle its opioid-related claims for a total of $80 million (of which $35 million was paid in December 2024 and the remainder was paid in July 2025), averting a trial that was scheduled to begin on September 16, 2024.
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Notes to Consolidated Financial Statements
(Unaudited)
With its settlement with the City of Baltimore, Teva has settled with 100% of the U.S. states and litigating political subdivisions and the Native American tribes (the “Tribes”). Teva’s estimated cash payments between 2025 and 2029 for all opioids settlements are: $419 million to be paid in 2025 (of which $412 million was paid as of September 30, 2025), $363 million payable in 2026; $364 million payable in 2027; $385 million payable in 2028; and $339 million payable in 2029. These payments are subject to change based on various factors including, but not limited to, timing of payments, most favored nations clauses associated with prior settlements, and the states’ elections to take Teva’s generic version of Narcan
®
(naloxone hydrochloride nasal spray). The remaining payments, subject to adjustments, will be paid beyond 2030.
Various Teva affiliates, along with several other pharmaceutical companies, were named as defendants in opioids cases initiated by approximately 500 U.S. hospitals and other healthcare providers asserting opioid-related claims, including public nuisance. Specifically, the lawsuits brought by the hospitals allege that they have incurred financial harm from increased operating costs for treating patients whose underlying illnesses are purportedly exacerbated or complicated by opioid addiction. In September 2024, Teva and the representatives for acute care hospitals finalized the terms of a proposed class settlement agreement. No eligible hospitals or healthcare providers opted out. On March 4, 2025, the court overseeing the hospital cases granted final approval for the settlement. Under the financial terms of the national settlement agreement, Teva will pay up to $126 million in cash, spread over 18 years, and supply up to $49 million of Teva’s generic version of Narcan
®
(naloxone hydrochloride nasal spray), valued at wholesale acquisition cost, over
7
years.
In light of the nationwide settlement agreement between Teva and the States’ Attorneys General and their subdivisions, Teva’s indemnification obligations arising from Teva’s acquisition of the Actavis Generics business for opioid-related claims, prior settlements reached with Louisiana, Texas, Rhode Island, Florida, San Francisco, West Virginia, New York, the Tribes, Nevada and the City of Baltimore, the agreement with the hospitals discussed above, as well as an estimate for a number of items including, but not limited to, costs associated with administering injunctive terms, and most favored nations clauses associated with prior settlements, the Company has recorded a provision. The provision is a reasonable estimate of the ultimate costs for Teva’s opioids settlements, after discounting payments to their net present value. Opioid-related lawsuits brought against Teva by dozens of third-party payers, such as unions and welfare funds, remain pending. A reasonable upper end of a range of loss cannot be determined for the entirety of the remaining opioid-related cases. An adverse resolution of any of these lawsuits or investigations may involve large monetary penalties, damages, and/or other forms of monetary and
non-monetary
relief and could have a material and adverse effect on Teva’s reputation, business, results of operations and cash flows.
In addition, Teva, certain of its subsidiaries and other defendants, are defending claims and putative class action lawsuits in Canada related to the manufacture, sale, marketing and distribution of opioid medications. The lawsuits include: (i) a claim brought by the Province of British Columbia on behalf of itself and a putative class of other federal and provincial governments, (ii) claims of municipalities, (iii) claims on behalf of various First Nations groups, and (iv) consumer class actions on behalf of persons who used opioids on behalf of themselves and putative classes. On January 22, 2025, the British Columbia Supreme Court certified the class of federal and provincial governments. Defendants appealed this decision, and a hearing on this appeal is scheduled for December 2025. The court in Quebec certified the class in the consumer class action in 2024 (and denied leave to appeal), and the court in Ontario scheduled a certification hearing for an additional consumer class for March 2026. Other Canadian opioid actions remain in their preliminary stages.
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Notes to Consolidated Financial Statements
(Unaudited)
Shareholder Litigation
In November and December 2016, two putative securities class actions were filed in the U.S. District Court for the Central District of California against Teva and certain of its current and former officers and directors, which were subsequently consolidated and transferred to the U.S. District Court for the District of Connecticut (the “Ontario Teachers Securities Litigation”). On December 13, 2019, the lead plaintiff filed an amended complaint, purportedly on behalf of purchasers of Teva’s securities between February 6, 2014 and May 10, 2019, asserting that Teva and certain of its current and former officers and directors violated federal securities and common laws in connection with Teva’s alleged failure to disclose pricing strategies for various drugs in its generic drug portfolio and by making allegedly false or misleading statements in certain offering materials. From July 2017 to June 2019, other putative securities class actions were filed in other federal courts based on similar allegations and claims, and were transferred to the U.S. District Court for the District of Connecticut. Between August 2017 and January 2022, twenty-three complaints were filed against Teva and certain of its current and former officers and directors on behalf of plaintiffs in various forums across the country, but many of those plaintiffs
“opted-out”
of the Ontario Teachers Securities Litigation. On January 18, 2022, Teva entered into a settlement in the Ontario Teachers Securities Litigation for $420 million, which received final approval from the court on June 2, 2022. The vast majority of the total settlement amount was covered by the Company’s insurance carriers, with a small portion contributed by Teva. Additionally, as part of the settlement, Teva admitted no liability and denied all allegations of wrongdoing. On January 22, 2021, the Court dismissed the
“opt-out”
plaintiffs’ claims arising from statements made prior to the five-year statute of repose, but denied Teva’s motion to dismiss their claims under Israeli laws. Teva has settled the majority of the
“opt-out”
claims, and one
opt-out
case remains outstanding. Teva also reached a settlement with shareholders who filed class actions in Israel with similar allegations to those raised in the Ontario Teachers Securities Litigation, which was approved by the court in Israel in November 2023.
On September 23, 2020, a putative securities class action was filed in the U.S. District Court for the Eastern District of Pennsylvania against Teva and certain of its former officers. On August 10, 2021, the lead plaintiff filed a corrected amended class action complaint, purportedly on behalf of persons who purchased or otherwise acquired Teva securities between October 29, 2015 and August 18, 2020. The corrected amended complaint alleges that Teva and certain of its current and former officers violated federal securities laws by allegedly making false and misleading statements regarding the commercial performance of COPAXONE, namely, by failing to disclose that Teva had allegedly caused the submission of false claims to Medicare through Teva’s donations to bona fide independent charities that provide financial assistance to patients, which allegedly impacted COPAXONE’s commercial success and the sustainability of its revenues and resulted in the DOJ PAP Complaint filed by the DOJ. The corrected amended complaint seeks unspecified damages and legal fees. On November 3, 2023, the court granted plaintiff’s motion for class certification, to which Teva filed a petition with the Third Circuit Court of Appeals for leave to appeal, which was denied on May 16, 2024. A motion to approve a securities class action was also filed in September 2022 in the Central District Court in Israel, which has been stayed pending the U.S. litigation, with similar allegations to those made in the above complaint filed in the U.S. District Court for the Eastern District of Pennsylvania.
Environmental Matters
Teva or its subsidiaries are party to a number of environmental proceedings, or have received claims, including under the federal Superfund law or other federal, provincial or state and local laws, imposing liability for alleged noncompliance, or for the investigation and remediation of releases of hazardous substances and for natural resource damages. Many of these proceedings and claims seek to require the generators of hazardous wastes disposed of at a third party-owned site, or the party responsible for a release of hazardous substances, including
per-and
polyfluoroalkyl substances (PFAS), that impacted a site, to investigate and clean the site or to pay or reimburse others for such activities, including for oversight by governmental authorities and any related damages to natural resources. Teva or its subsidiaries have received claims, or been made a party to these proceedings, along with others, as an alleged generator of wastes that were disposed of or treated at third-party waste disposal sites, or as a result of an alleged release from one of Teva’s facilities or former facilities.
Although liability among the responsible parties, under certain circumstances, may be joint and several, these proceedings are frequently resolved so that the allocation of
clean-up
and other costs among the parties reflects the relative contributions of the parties to the site conditions and takes into account other pertinent factors. Teva’s potential liability varies greatly at each of the sites; for some sites the costs of the investigation,
clean-up
and natural resource damages have not yet been determined, and for others Teva’s allocable share of liability has not been determined. At other sites, Teva has taken an active role in identifying those costs, to the extent they are identifiable and estimable, which do not include reductions for potential recoveries of
clean-up
costs from insurers, indemnitors, former site owners or operators or other potentially responsible parties. In addition, enforcement proceedings relating to alleged violations of federal, state, commonwealth or local requirements at some of Teva’s facilities may result in the imposition of significant penalties (in amounts not expected to materially adversely affect Teva’s results of operations) and the recovery of certain costs and natural resource damages, and may require that corrective actions and enhanced compliance measures be implemented.
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Notes to Consolidated Financial Statements
(Unaudited)
Item 103 of Regulation
S-K
promulgated by the SEC requires disclosure of certain environmental matters when a governmental authority is a party to the proceedings and such proceedings involve potential monetary sanctions, unless the Company reasonably believes that the matter will result in no monetary sanctions, or in monetary sanctions, exclusive of interest and costs, of less than $300,000. The following matter is disclosed in accordance with that requirement. On July 8, 2021, the National Green Tribunal Principal Bench, New Delhi, issued an order against Teva’s subsidiary in India, Teva API India Private Limited, finding
non-compliance
with environmental laws and assessing a penalty of $1.4 million. Teva filed an appeal before the Hon’ble Supreme Court of India, disputing certain of the findings and the amount of the penalty. On August 5, 2021, the Supreme Court of India granted a stay of the judgment by the National Green Tribunal Principal Bench. On April 8, 2025, the Supreme Court of India accepted the appeal filed by Teva’s subsidiary and a hearing will be scheduled in due course. The Company does not believe that the eventual outcome of such matter will have a material effect on its business.
Gain Contingencies
From time to time, Teva may directly or indirectly pursue claims against certain parties, including but not limited to patent infringement lawsuits against other pharmaceutical companies to protect its patent rights, as well as derivative actions brought on behalf of Teva. Teva recognizes gain contingencies from the defendants in such lawsuits when they are realized or when all related contingencies have been resolved. No gain has been recognized regarding any matter disclosed below, unless mentioned otherwise.
In October 2017, Teva filed a lawsuit in the U.S. District Court for the District of Massachusetts alleging that Eli Lilly & Co.’s (“Lilly”) marketing and sale of its galcanezumab product for the treatment of migraine infringes on nine Teva patents, including three method of treatment patents and six composition of matter patents. Lilly then submitted inter partes review (“IPR”) petitions to the Patent Trial and Appeal Board (“PTAB”), challenging the validity of the nine Teva patents. The PTAB issued decisions upholding the three method of treatment patents but finding the six composition of matter patents invalid, which decisions were affirmed by the Court of Appeals for the Federal Circuit on August 16, 2021. A jury trial regarding the three method of treatment patents resulted in a verdict in Teva’s favor on November 9, 2022. The jury’s verdict found that the three method of treatment patents were valid and infringed by Lilly and awarded Teva
$
176.5
million in damages. On September 26, 2023, the U.S. District Court for the District of Massachusetts issued a decision that reversed the jury’s verdict and damages award, finding Teva’s method of treatment patents to be invalid. Teva appealed and a hearing was held on September 5, 2025. A decision remains pending.
In March 2024, Teva filed a lawsuit in the U.S. District Court for the District of New Jersey alleging that Amarin Pharma, Inc., Amarin Pharmaceuticals Ireland Limited, and Amarin Corporation plc (collectively “Amarin”) engaged in a decade-long scheme to lock up the supply of icosapent ethyl to prevent and delay generic competition to its branded Vascepa
®
drug product. Teva’s lawsuit coincides with four other lawsuits brought by generic drug manufacturers and purchasers of branded Vascepa
®
alleging the same or similar conduct by Amarin. Teva’s requested relief includes compensatory damages for lost sales and lost profits from generic icosapent ethyl drug sales that Teva could have made absent Amarin’s alleged interference. On May 24, 2024, Amarin filed a motion in the U.S. District Court for the District of Nevada, seeking to enforce the terms of an earlier
Teva-Amarin
agreement to settle patent litigation regarding Vascepa
®
, which Amarin asserts precludes Teva from filing the present antitrust action. Teva opposed this motion on June 7, 2024, and on December 4, 2024, the Nevada court denied Amarin’s motion. On March 25, 2025, Amarin filed a
“pre-motion
letter” with the District of New Jersey, where the case is pending, asking for permission to file a motion for judgment on the pleadings on the same grounds as its motion in Nevada. On October 8, 2025, the Court granted Amarin’s request to file its motion. Amarin served its motion on October 29, 2025. Briefing on Amarin’s motion is expected to be completed on November 19, 2025. As the lawsuit is still in its initial stages, it is not possible to predict its outcome and there is no guarantee that Teva will be granted its requested relief.
In June 2024, Teva filed a lawsuit in the U.S. District Court for the Northern District of California alleging that Corcept Therapeutics, Inc. (“Corcept”), and Optime Care Inc. (“Optime”) have engaged in a multifaceted, years-long scheme to stifle generic competition to Corcept’s branded Korlym
®
(mifepristone) drug product, which is indicated to treat endogenous Cushing’s syndrome. Teva alleges that Corcept and Optime have suppressed competition by abusing the patent and judicial systems, entering a long-term, blanket exclusive-dealing agreement that has locked up a key pharmaceutical distribution channel, and making illicit payments to physicians as compensation for prescribing Korlym
®
. Teva’s requested relief includes compensatory damages for lost sales and lost profits from generic mifepristone drug sales that Teva could have made absent Corcept and Optime’s alleged interference, as well as injunctive relief to remove the unlawful barriers to generic competition created by Corcept and Optime. Teva filed an amended complaint in September 2024. Defendants filed a joint motion to dismiss in October 2024, which the court denied in substantial part on September 12, 2025. On September 26, 2025, Teva filed an amended complaint amending certain claims that were dismissed. Discovery is ongoing. As the lawsuit is still in its initial stages, it is not possible to predict its outcome and there is no guarantee that Teva will be granted its requested relief.
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Notes to Consolidated Financial Statements
(Unaudited)
Motions to approve derivative actions seeking monetary damages against certain past and present directors and officers have been filed in Israeli Courts alleging negligence and recklessness, as well as motions for document disclosure prior to initiating derivative actions. Motions were filed with respect to several U.S. and EU settlement agreements, allegations related to the DOJ PAP Complaint, an
d
with respect to the European Commission’s proceedings relating to COPAXONE.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
NOTE 11 – Income taxes:
In the third quarter of 2025, Teva recognized a tax expense of $214 million, on a
pre-tax
income of $646 million. In the third quarter of 2024, Teva recognized a tax expense of $69 million, on a
pre-tax
loss of $324 million.
Teva’s tax rate for the third quarter of 2025 was mainly impacted by changes in deferred tax balances due to statutory tax rate changes and interest and inflation adjustments related to the agreement with the Israeli Tax Authorities (“ITA”) mentioned below.
Teva’s tax rate for the third quarter of 2024 was mainly impacted by impairment charges with no corresponding tax effects, an adjustment to the Company’s corporate tax rate in Israel on losses related to
non-qualified
tax incentive activities in Israel, legal expenses with no corresponding tax effect related to the fine issued by the European Commission in connection with its antitrust investigation into COPAXONE, and recording of valuation allowance with respect to certain carry over credits outside of Israel.
In the first nine months of 2025, Teva recognized a tax expense of $210 million, on a
pre-tax
income of $1,143 million. In the first nine months of 2024, Teva recognized a tax expense of $648 million, on a
pre-tax
loss of $1,037 million.
Teva’s tax rate for the first nine months of 2025 was mainly impacted by releases of uncertain tax positions, interest and inflation adjustments related to the agreement with the ITA mentioned below, foreign exchange impact on deferred tax positions and changes in deferred tax balances due to statutory tax rate changes.
Teva’s tax rate for the first nine months of 2024 was mainly impacted by a settlement agreement with the ITA as discussed below, impairment charges with no corresponding tax effects, deferred tax benefits resulting from intellectual property related integration plans, an adjustment to the Company’s corporate tax rate in Israel on losses related to
non-qualified
tax incentives activities in Israel, legal expenses with no corresponding tax effect related to the fine issued by the European Commission in connection with its antitrust investigation into COPAXONE, and recording of valuation allowance with respect to certain carry over credits outside of Israel.
The statutory Israeli corporate tax rate is 23% in 2025. Teva’s global tax rate differs from the Israeli statutory tax rate, mainly due to generation of profits in various jurisdictions in which tax rates are different than the Israeli tax rate, tax benefits, as well as infrequent or
non-recurring
items.
Teva filed a claim seeking the refund of withholding taxes paid to the Indian tax authorities in 2012. A trial for this case is currently ongoing. A final and binding decision against Teva in this case may lead to a charge of $118 million.
On June 23, 2024, Teva entered into an agreement with the ITA to settle certain litigation with respect to taxes payable for the Company’s taxable years 2008 through 2020 (the “Agreement”). Pursuant to the terms of the Agreement, the Company will pay a total amount of approximately $750 million (based on exchange rates at the date of the Agreement) to the ITA spread over a
six-year
period beginning in 2024. Additionally, under the terms of the Agreement, it was further agreed that in the future event the Company pays dividends on, or repurchases, its equity interests, the Company will pay an additional
5%-7%
of the amount of such dividends or repurchases in corporate taxes, up to a maximum tax payment amount of approximately $500 million. Any amounts due under this provision of the Agreement will be recorded in the future as incurred.
Teva periodically assesses the need for valuation allowances against its deferred tax assets, and considers available evidence including but not limited to, the Company’s recent earnings history, forecasted future taxable income to the extent it is objectively verifiable, and significant nonrecurring items impacting those amounts. To the extent Teva’s operating results improve or deteriorate, or to the extent changes in tax laws and other factors affect Teva’s ability to utilize deferred tax assets, Teva may need to adjust its valuation allowance.
With respect to certain U.S. tax attributes, depending on Teva’s future operating results, the Company may have sufficient positive evidence to release valuation allowances within the next twelve months. If realized, the release would result in recognition of certain deferred tax assets, with a corresponding income tax benefit in the period in which it is recorded.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
On July 4, 2025, the One Big Beautiful Bill Act was signed into law in the United States. The Act contains certain provisions related to the extent of deductibility of interest expense for U.S. federal tax purposes, R&D costs and other depreciable property, as well as changes to U.S. taxation of foreign subsidiaries’ earnings, and other U.S. corporate tax law changes. Pursuant to ASC 740, changes in tax rates and tax law are required to be recognized in the period in which the legislation is enacted. Teva evaluated the potential impact of this Act on its annual consolidated financial statements and related disclosures, and does not expect the Act to have a material impact on its 2025 consolidated financial statements.
Teva believes it has adequately provided for all of its uncertain tax positions, including items currently under dispute, however, adverse outcomes to any of these positions or disputes could be material.
The OECD introduced Base Erosion and Profit Shifting (“BEPS”) Pillar Two rules that impose a global minimum tax rate of 15% for large multinational corporations. On December 12, 2022, the EU Council announced that EU member states had reached an agreement to implement the minimum taxation component of 15% of the OECD’s reform of international taxation. Teva has evaluated the potential impact on its 2025 consolidated financial statements and related disclosures and does not expect Pillar Two to have a material impact on its effective tax rate or consolidated financial statements in the foreseeable future.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
NOTE 12 – Other assets impairments, restructuring and other items:

|  | Three months ended September 30, |  |  | Nine months ended September 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions) |  |  | (U.S. $ in millions) |
Impairments of long-lived tangible assets (*) |  | $ | 15 |  |  | $ | (80 | ) |  | $ | 28 |  |  | $ | 589 |
Contingent consideration |  |  | 16 |  |  |  | 34 |  |  |  | 46 |  |  |  | 305 |
Restructuring |  |  | 29 |  |  |  | 21 |  |  |  | 196 |  |  |  | 52 |
Other |  |  | 3 |  |  |  | 1 |  |  |  | 2 |  |  |  | (16 | )
Total |  | $ | 62 |  |  | $ | (23 | ) |  | $ | 272 |  |  | $ | 931 |

(*) | Including impairments related to exit and disposal activities.

Impairments
In the three months ended September 30, 2025, Teva recorded an expense of $15 million under impairments of tangible assets, compared to an income of $80
million in the three months ended September 30, 2024. 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 the fair value update in connection with the classification of the business venture in Japan as held for sale.
Impairments of tangible assets for the nine months ended September 30, 2025 and 2024 were $28 million and $589
million, respectively. The impairments for the nine months ended September 30, 2024 were mainly related to the classification of the business venture in Japan as held for sale (see note 2).
In addition, as part of the Company’s efforts to further focus its business by optimizing its portfolio and global manufacturing footprint to achieve additional operational efficiencies, the Company, from time to time, evaluates strategic alternatives for certain individual assets or asset groups. These strategic alternatives may include partnerships, joint ventures, redeployment of assets or divestitures. These actions may involve substantial impairment charges in the future depending on the ultimate course of action for these long-lived assets. Any such impairment charges are recorded in the period in which there is a triggering event or commitment to a probable transaction.
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 network consolidation activities and its Pivot to Growth strategy.
Contingent consideration
In the three months ended September 30, 2025, Teva recorded an expense of $16 million for contingent consideration, compared to an expense of $34 million in the three months ended September 30, 2024. The expenses in the three months ended September 30, 2025 were mainly related to a change in the estimated future royalty payments to Eagle in connection with expected future bendamustine sales. 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.
In the nine months ended September 30, 2025, Teva recorded an expense of $46 million for contingent consideration, compared to an expense of $305 million in the nine months ended September 30, 2024. The expense in the first nine months of 2025 was mainly related to lenalidomide capsules (the generic version of Revlimid
®
) (mainly the effect of the passage of time on the net present value of the discounted payments) and to a change in the estimated future royalty payments to Eagle in connection with expected future bendamustine sales. The expenses in the first nine months of 2024 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.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
Restructuring
In the three months ended September 30, 2025, Teva recorded $29 million of restructuring expenses, compared to $21 million in the three months ended September 30, 2024. Expenses in the three months ended September 30, 2025 were primarily related to optimization activities in connection with Teva’s Transformation programs related to Teva’s global organization and operations, mainly through headcount reductions. Expenses in the three months ended September 30, 2024 primarily related to network consolidation activities.
In the nine months ended September 30, 2025, Teva recorded $196 million of restructuring expenses, compared to $52 million in the nine months ended September 30, 2024. Expenses in the nine months ended September 30, 2025 were primarily related to optimization activities in connection with Teva’s Transformation programs related to Teva’s global organization and operations, mainly through headcount reduction. Expenses in the nine months ended September 30, 2024 primarily related to network consolidation activities.
Under Teva’s Transformation programs announced on May 7, 2025, Teva expects to achieve cost savings through a variety of initiatives including examining practices and efficiencies in methods of working, reduction in headcount and optimizing external spend in the following years. These Transformation programs are expected to result in the reduction of approximately 8% of Teva’s total work force as of December 31, 2024, by the end of 2027.
The following tables provide the components of the Company’s restructuring costs:

|  | Three months ended September 30, |
|  | 2025 |  |  | 2024 |
|  | (U.S. $in millions) |
Restructuring |  |  |  |  |  |  |  |
Employee termination |  | $ | 28 |  |  | $ | 13 |
Other |  |  | 1 |  |  |  | 8 |
Total |  | $ | 29 |  |  | $ | 21 |
|  | Nine months ended September 30, |
|  | 2025 |  |  | 2024 |
|  | (U.S. $in millions) |
Restructuring |  |  |  |  |  |  |  |
Employee termination |  | $ | 191 |  |  | $ | 33 |
Other |  |  | 5 |  |  |  | 19 |
Total |  | $ | 196 |  |  | $ | 52 |

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, 2025 |  | $ | (55 | ) |  | $ | (13 | ) |  | $ | (68 | )
Provision |  |  | (191 | ) |  |  | (5 | ) |  |  | (196 | )
Utilization and other* |  |  | 92 |  |  |  | 4 |  |  |  | 96 |
Balance as of September 30, 2025 |  | $ | (154 | ) |  | $ | (14 | ) |  | $ | (168 | )
|  | 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 | )

* | Includes adjustments for foreign currency translation.

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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
NOTE 13 – Earnings (Loss) per share:
Basic earnings and loss per share are computed by dividing net income (loss) attributable to Teva’s ordinary shareholders by the weighted average number of ordinary shares outstanding, including fully vested restricted share units (“RSUs”) and performance share units (“PSUs”) during the period, net of treasury shares.
Basic and diluted earnings (loss) per share attributable to Teva’s ordinary shareholders for the three and nine months ended September 30, 2025, are calculated as follows:

|  | Three Months Ended |  |  | Nine Months Ended |
|  | September 30, |  |  | September 30, |
(U.S. $ in millions except per share amounts) |  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
Basic earnings (loss) attributable to Teva’s ordinary shareholders (numerator): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net income (loss) attributable to Teva’s ordinary shareholders |  | $ | 433 |  |  | $ | (437 | ) |  | $ | 930 |  |  | $ | (1,422 | )
Shares (denominator): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Weighted average shares outstanding |  |  | 1,147 |  |  |  | 1,133 |  |  |  | 1,144 |  |  |  | 1,130 |
Basic earnings (loss) attributable to Teva’s ordinary shareholders |  | $ | 0.38 |  |  | $ | (0.39 | ) |  | $ | 0.81 |  |  | $ | (1.26 | )
Diluted earnings (loss) attributable to Teva’s ordinary shareholders (numerator): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net income (loss) attributable to Teva’s ordinary shareholders |  | $ | 433 |  |  | $ | (437 | ) |  | $ | 930 |  |  | $ | (1,422 | )
Shares (denominator): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Weighted average shares outstanding |  |  | 1,147 |  |  |  | 1,133 |  |  |  | 1,144 |  |  |  | 1,130 |
Diluted effect of stock options, RSUs and PSUs |  |  | 17 |  |  |  | — |  |  |  | 16 |  |  |  | — |
Total dilutive shares outstanding |  |  | 1,164 |  |  |  | 1,133 |  |  |  | 1,160 |  |  |  | 1,130 |
Diluted earnings (loss) attributable to Teva’s ordinary shareholders |  | $ | 0.37 |  |  | $ | (0.39 | ) |  | $ | 0.80 |  |  | $ | (1.26 | )

In computing diluted earnings per share for the three and nine months ended September 30, 2025, basic earnings per share were adjusted to take into account the potential dilution that could occur upon the exercise of options and
non-vested
RSUs and PSUs granted under employee stock compensation plans. No account was taken of the potential dilution that could occur upon the exercise of convertible senior debentures, since they had an anti-dilutive effect on earnings per share. Additionally, an amount of 27.6 million and 28.6 million dilutive shares of ordinary shares from the conversion of outstanding stock options, RSUs and PSUs were excluded from the computation of diluted earnings per share attributable to Teva’s ordinary shareholders for the three and nine months ended September 30, 2025, respectively.
In computing diluted loss per share for the three and nine months ended September 30, 2024, no account was taken of the potential dilution that could occur upon the exercise of options and
non-vested
RSUs and PSUs granted under employee stock compensation plans, and convertible senior debentures, since they had an anti-dilutive effect on loss per share. Additionally, an amount of 51.7 million dilutive shares of ordinary shares from the conversion of outstanding stock options, RSU’s and PSUs were excluded from the computation of diluted earnings per share attributable to Teva’s ordinary shareholders for the three and nine months ended September 30, 2024.
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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
NOTE 14 – Accumulated other comprehensive income (loss):
The components of, and changes within, accumulated other comprehensive income (loss) attributable to Teva are presented in the table below:

|  | Net Unrealized Gains (Losses) |  |  | Benefit Plans |  |  |  |
|  | Foreign currency translation adjustments |  |  | Derivative financial instruments |  |  | Actuarial gains (losses) and prior service (costs) credits |  |  | Total |
|  | (U.S. $ in millions) |
Balance as of December 31, 2024, net of taxes |  | $ | (2,857 | ) |  | $ | (238 | ) |  | $ | (52 | ) |  | $ | (3,148 | )
Other comprehensive income (loss) before reclassifications |  |  | 509 |  |  |  | — |  |  |  | — |  |  |  | 509 |
Amounts reclassified to the statements of income |  |  | — |  |  |  | 30 |  |  |  | (2 | ) |  |  | 28 |
Release of cumulative translation adjustments** |  |  | 181 |  |  |  | — |  |  |  | — |  |  |  | 181 |
Net other comprehensive income (loss) before tax |  |  | 690 |  |  |  | 30 |  |  |  | (2 | ) |  |  | 718 |
Corresponding income tax |  |  | 45 |  |  |  | — |  |  |  | — |  |  |  | 45 |
Net other comprehensive income (loss) after tax* |  |  | 645 |  |  |  | 30 |  |  |  | (2 | ) |  |  | 673 |
Balance as of September 30, 2025, net of taxes |  | $ | (2,212 | ) |  | $ | (208 | ) |  | $ | (54 | ) |  | $ | (2,475 | )

* | Amounts do not include a $27 million gain from foreign currency translation adjustments attributable to redeemable and non-redeemable non-controlling interests.

** | In connection with the sale of Teva’s business venture in Japan.

|  | Net Unrealized Gains (Losses) |  |  | Benefit Plans |  |  |  |
|  | Foreign currency translation adjustments |  |  | Derivative financial instruments |  |  | Actuarial gains (losses) and prior service (costs) credits |  |  | Total |
|  | (U.S. $ in millions) |
Balance as of December 31, 2023, net of taxes |  | $ | (2,384 | ) |  | $ | (266 | ) |  | $ | (46 | ) |  | $ | (2,697 | )
Other comprehensive income (loss) before reclassifications |  |  | (84 | ) |  |  | — |  |  |  | 1 |  |  |  | (83 | )
Amounts reclassified to the statements of income |  |  | — |  |  |  | 21 |  |  |  | (3 | ) |  |  | 18 |
Net other comprehensive income (loss) before tax |  |  | (84 | ) |  |  | 21 |  |  |  | (2 | ) |  |  | (65 | )
Corresponding income tax |  |  | (7 | ) |  |  | — |  |  |  | — |  |  |  | (7 | )
Net other comprehensive income (loss) after tax* |  |  | (91 | ) |  |  | 21 |  |  |  | (2 | ) |  |  | (72 | )
Balance as of September 30, 2024, net of taxes |  | $ | (2,475 | ) |  | $ | (245 | ) |  | $ | (48 | ) |  | $ | (2,769 | )

* | Amounts do not include a $6 million loss from foreign currency translation adjustments attributable to non-controlling interests.

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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
NOTE 15 – Segments:
Teva operates its business and reports its financial results in the following 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 included in other activities, 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 the United States, Europe and International Markets, to make decisions about resources to be allocated to the segments and assess their performance.
The key areas of focus by the CODM for allocation of resources are revenues from each reportable segment, as well as operating expenses (cost of sales, R&D expenses, S&M expenses, G&A expenses, and other expenses (income)). While the CODM analyzes each of these categories, the CODM focuses particularly on period-over-period fluctuations and
budget-to-actual
variances to determine the right allocation of resources to be attributed to each segment to ensure profitability is maximized.
Segment profit is comprised of revenues for the segment less cost of sales, R&D expenses, S&M expenses, G&A expenses and other expenses (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 6.
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. The intention to divest is in alignment with Teva’s Pivot to Growth strategy. As of the date of this Quarterly Report on Form 10-Q, exclusive discussions with a selected buyer on the sale have terminated. Teva is initiating a renewed sales process, maintaining its strategic intention to divest its API business. 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. See note 2.

| a. | Segment information:

|  | Three months ended September 30, |
|  | 2025 |
|  | United States |  |  | Europe |  |  | International Markets |
|  | (U.S. $ in millions) |
Revenues |  | $ | 2,483 |  |  | $ | 1,235 |  |  | $ | 557 |
Cost of sales |  |  | 996 |  |  |  | 570 |  |  |  | 280 |
R&D expenses |  |  | 161 |  |  |  | 62 |  |  |  | 26 |
S&M expenses |  |  | 278 |  |  |  | 225 |  |  |  | 122 |
G&A expenses |  |  | 114 |  |  |  | 75 |  |  |  | 36 |
Other |  |  | (3 | ) |  |  | § |  |  |  | § |
Segment profit |  | $ | 937 |  |  | $ | 303 |  |  | $ | 95 |

§ | Represents an amount less than $0.5 million.

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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)

|  | Three months ended September 30, |
|  | 2024 |
|  | United States |  |  | Europe |  |  | International Markets |
|  | (U.S. $ in millions) |
Revenues |  | $ | 2,225 |  |  | $ | 1,265 |  |  | $ | 613 |
Cost of sales |  |  | 960 |  |  |  | 566 |  |  |  | 307 |
R&D expenses |  |  | 151 |  |  |  | 55 |  |  |  | 27 |
S&M expenses |  |  | 259 |  |  |  | 203 |  |  |  | 134 |
G&A expenses |  |  | 107 |  |  |  | 67 |  |  |  | 36 |
Other |  |  | § |  |  |  | 1 |  |  |  | § |
Segment profit |  | $ | 748 |  |  | $ | 373 |  |  | $ | 109 |

§ | Represents an amount less than $0.5 million.

|  | Nine months ended September 30, |
|  | 2025 |
|  | United States |  |  | Europe |  |  | International Markets |
|  | (U.S. $ in millions) |
Revenues |  | $ | 6,543 |  |  | $ | 3,726 |  |  | $ | 1,634 |
Cost of sales |  |  | 2,748 |  |  |  | 1,687 |  |  |  | 835 |
R&D expenses |  |  | 467 |  |  |  | 181 |  |  |  | 75 |
S&M expenses |  |  | 831 |  |  |  | 652 |  |  |  | 353 |
G&A expenses |  |  | 323 |  |  |  | 210 |  |  |  | 107 |
Other |  |  | (1 | ) |  |  | § |  |  |  | (3 | )
Segment profit |  | $ | 2,175 |  |  | $ | 996 |  |  | $ | 266 |

§ | 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 |
Cost of sales |  |  | 2,769 |  |  |  | 1,637 |  |  |  | 914 |
R&D expenses |  |  | 475 |  |  |  | 173 |  |  |  | 85 |
S&M expenses |  |  | 789 |  |  |  | 605 |  |  |  | 397 |
G&A expenses |  |  | 300 |  |  |  | 197 |  |  |  | 109 |
Other |  |  | (1 | ) |  |  | 1 |  |  |  | (1 | )
Segment profit |  | $ | 1,727 |  |  | $ | 1,137 |  |  | $ | 299 |

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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
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 months ended September 30, 2025 and 2024:

|  | Three months ended |  |  | Nine months ended |
|  | September 30, |  |  | September 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions) |  |  | (U.S. $ in millions) |
United States profit |  | $ | 937 |  |  | $ | 748 |  |  | $ | 2,175 |  |  | $ | 1,727 |
Europe profit |  |  | 303 |  |  |  | 373 |  |  |  | 996 |  |  |  | 1,137 |
International Markets profit |  |  | 95 |  |  |  | 109 |  |  |  | 266 |  |  |  | 299 |
Total reportable segments profit |  |  | 1,334 |  |  |  | 1,230 |  |  |  | 3,437 |  |  |  | 3,163 |
Profit (loss) of other activities |  |  | (40 | ) |  |  | (16 | ) |  |  | (64 | ) |  |  | (1 | )
Amounts not allocated to segments: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Amortization |  |  | 144 |  |  |  | 146 |  |  |  | 436 |  |  |  | 444 |
Other assets impairments, restructuring and other items |  |  | 62 |  |  |  | (23 | ) |  |  | 272 |  |  |  | 931 |
Goodwill impairment |  |  | — |  |  |  | 600 |  |  |  | — |  |  |  | 1,000 |
Intangible assets impairments |  |  | 64 |  |  |  | 28 |  |  |  | 227 |  |  |  | 169 |
Legal settlements and loss contingencies |  |  | 60 |  |  |  | 450 |  |  |  | 309 |  |  |  | 638 |
Other unallocated amounts |  |  | 82 |  |  |  | 64 |  |  |  | 272 |  |  |  | 254 |
Consolidated operating income (loss) |  |  | 882 |  |  |  | (51 | ) |  |  | 1,857 |  |  |  | (274 | )
Financial expenses, net |  |  | 237 |  |  |  | 272 |  |  |  | 714 |  |  |  | 763 |
Consolidated income (loss) before income taxes |  | $ | 646 |  |  | $ | (324 | ) |  | $ | 1,143 |  |  | $ | (1,037 | )

b. Segment revenues by major products and activities:
The following tables present revenues by
major
products and activities for the three months ended September 30, 2025 and 2024:

United States |  | Three months ended September 30, |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions) |
Generic products (including biosimilars) |  | $ | 1,175 |  |  | $ | 1,094 |
AJOVY ® |  |  | 73 |  |  |  | 58 |
AUSTEDO |  |  | 601 |  |  |  | 435 |
BENDEKA ® and TREANDA ® |  |  | 35 |  |  |  | 40 |
COPAXONE |  |  | 62 |  |  |  | 69 |
UZEDY |  |  | 43 |  |  |  | 35 |
Anda |  |  | 392 |  |  |  | 380 |
Other |  |  | 101 |  |  |  | 115 |
Total |  | $ | 2,483 |  |  | $ | 2,225 |

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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)

United States |  | Nine months ended September 30, |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions) |
Generic products (including biosimilars) |  | $ | 2,984 |  |  | $ | 2,924 |
AJOVY |  |  | 190 |  |  |  | 144 |
AUSTEDO |  |  | 1,492 |  |  |  | 1,124 |
BENDEKA and TREANDA |  |  | 111 |  |  |  | 127 |
COPAXONE |  |  | 179 |  |  |  | 179 |
UZEDY |  |  | 136 |  |  |  | 75 |
Anda |  |  | 1,130 |  |  |  | 1,134 |
Other |  |  | 321 |  |  |  | 352 |
Total |  | $ | 6,543 |  |  | $ | 6,060 |

Europe |  | Three months ended September 30, |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions) |
Generic products (including OTC and biosimilars) |  | $ | 982 |  |  | $ | 973 |
AJOVY |  |  | 66 |  |  |  | 56 |
COPAXONE |  |  | 44 |  |  |  | 53 |
Respiratory products |  |  | 52 |  |  |  | 60 |
Other* |  |  | 91 |  |  |  | 124 |
Total |  | $ | 1,235 |  |  | $ | 1,265 |

* | Other revenues in the third quarter of 2025 and 2024 include the sale of certain product rights.

Europe |  | Nine months ended September 30, |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions) |
Generic products (including OTC and biosimilars) |  | $ | 3,011 |  |  | $ | 2,947 |
AJOVY |  |  | 195 |  |  |  | 158 |
COPAXONE |  |  | 135 |  |  |  | 163 |
Respiratory products |  |  | 162 |  |  |  | 183 |
Other* |  |  | 223 |  |  |  | 299 |
Total |  | $ | 3,726 |  |  | $ | 3,749 |

* | Other revenues in the first nine months of 2025 and 2024 include the sale of certain product rights.

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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)

International markets |  | Three months ended September 30, |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions) |
Generic products (including OTC and biosimilars) |  | $ | 421 |  |  | $ | 477 |
AJOVY |  |  | 30 |  |  |  | 24 |
AUSTEDO |  |  | 17 |  |  |  | 13 |
COPAXONE |  |  | 8 |  |  |  | 13 |
Other* |  |  | 82 |  |  |  | 86 |
Total |  | $ | 557 |  |  | $ | 613 |

* | Other revenues in the third quarter of 2025 and 2024 include the sale of certain product rights.

International markets |  | Nine months ended September 30, |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions) |
Generic products (including OTC and biosimilars) |  | $ | 1,298 |  |  | $ | 1,440 |
AJOVY |  |  | 78 |  |  |  | 63 |
AUSTEDO |  |  | 34 |  |  |  | 39 |
COPAXONE |  |  | 25 |  |  |  | 38 |
Other* |  |  | 199 |  |  |  | 222 |
Total |  | $ | 1,634 |  |  | $ | 1,802 |

* | Other revenues in the first nine months of 2025 and 2024 include the sale of certain product rights.

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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
NOTE 16 – Fair value measurement:
Financial items carried at fair value on a recurring basis as of September 30, 2025 and December 31, 2024 are classified in the tables below in one of the three categories of fair value levels:

|  | September 30, 2025 |
|  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |
|  | (U.S. $ in millions) |
Cash and cash equivalents: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Money markets |  | $ | 1,165 |  |  | $ | — |  |  | $ | — |  |  | $ | 1,165 |
Cash, deposits and other |  |  | 1,038 |  |  |  | — |  |  |  | — |  |  |  | 1,038 |
Investment in securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Equity securities |  |  | 16 |  |  |  | — |  |  |  | — |  |  |  | 16 |
Other |  |  | 3 |  |  |  | — |  |  |  | — |  |  |  | 3 |
Derivatives: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Asset derivatives: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Options and forward contracts |  |  | — |  |  |  | 64 |  |  |  | — |  |  |  | 64 |
Liability derivatives: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Options and forward contracts |  |  | — |  |  |  | (35 | ) |  |  | — |  |  |  | (35 | )
Cross currency interest rate swap |  |  | — |  |  |  | (18 | ) |  |  | — |  |  |  | (18 | )
Bifurcated embedded derivatives |  |  | — |  |  |  | — |  |  | § |  |  |  |  | — |
Contingent consideration* |  |  | — |  |  |  | — |  |  |  | (198 | ) |  |  | (198 | )
Total |  | $ | 2,222 |  |  | $ | 11 |  |  | $ | (198 | ) |  | $ | 2,035 |

|  | December 31, 2024 |
|  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |
|  | (U.S. $ in millions) |
Cash and cash equivalents: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Money markets |  | $ | 2,005 |  |  | $ | — |  |  | $ | — |  |  | $ | 2,005 |
Cash, deposits and other |  |  | 1,295 |  |  |  | — |  |  |  | — |  |  |  | 1,295 |
Investment in securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Equity securities |  |  | 12 |  |  |  | — |  |  |  | — |  |  |  | 12 |
Other |  |  | 3 |  |  |  | — |  |  |  | — |  |  |  | 3 |
Derivatives: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Asset derivatives: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Options and forward contracts |  |  | — |  |  |  | 71 |  |  |  | — |  |  |  | 71 |
Liability derivatives: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Options and forward contracts |  |  | — |  |  |  | (24 | ) |  |  | — |  |  |  | (24 | )
Bifurcated embedded derivatives |  |  | — |  |  |  | — |  |  | § |  |  |  |  | — |
Contingent consideration* |  | $ | — |  |  |  | — |  |  |  | (401 | ) |  |  | (401 | )
Total |  |  | 3,315 |  |  | $ | 47 |  |  | $ | (401 | ) |  | $ | 2,961 |

§ | Represents an amount less than $0.5 million.

* | Contingent consideration represents liabilities recorded at fair value in connection with acquisitions.

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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
Teva determined the fair value of the liabilities for contingent consideration based on a probability-weighted discounted cash flow analysis. This fair value measurement is based on significant unobservable inputs in the market and thus represents a Level 3 measurement within the fair value hierarchy. The fair value of contingent consideration is based on several factors, such as cash flows projected from the success of unapproved product candidates; probability of success of product candidates, including risks associated with uncertainty regarding achievement and payment of milestone events; time and resources required to complete the development and approval of product candidates; life of the potential commercialized products and associated risks with obtaining regulatory approvals in the United States and Europe, and the risk adjusted discount rate for fair value measurement. The discount rate applied ranged from 8.25% to 11%. The weighted average discount rate, calculated based on the relative fair value of Teva’s contingent consideration liabilities, was 8.8%. Contingent consideration is evaluated quarterly, or more frequently, if circumstances dictate. Changes in the fair value of contingent consideration are recorded in the consolidated statements of income. Significant changes in unobservable inputs, mainly the probability of success and cash flows projected, could result in material changes to the contingent consideration liabilities. A change of the discount rate by 1% would not have resulted in material changes to the contingent consideration liabilities.
The following table summarizes the activity for the financial assets and liabilities where fair value measurements are estimated utilizing Level 3 inputs:

|  | Nine months ended September 30, 2025 |  |  | Nine months ended September 30, 2024 |
|  | (U.S. $ in millions) |
Fair value at the beginning of the period |  | $ | (401 | ) |  |  | (477 | )
Redemption of convertible bond security* |  |  | — |  |  |  | (40 | )
Bifurcated embedded derivatives |  |  | § |  |  |  | § |
Adjustments to provisions for contingent consideration: |  |  |  |  |  |  |  |
Allergan transaction |  |  | (25 | ) |  |  | (267 | )
Eagle transaction |  |  | (20 | ) |  |  | (37 | )
Novetide transaction |  |  | (1 | ) |  |  | (1 | )
Settlement of contingent consideration: |  |  |  |  |  |  |  |
Allergan transaction |  |  | 212 |  |  |  | 227 |
Eagle transaction |  |  | 35 |  |  |  | 41 |
Novetide transaction |  |  | 2 |  |  |  | 2 |
Fair value at the end of the period |  | $ | (198 | ) |  | $ | (552 | )

§ | Represents an amount less than $0.5 million.

* | On September 29, 2023, Teva purchased $40 million of subordinated convertible bonds of Alvotech. On June 26, 2024, Alvotech announced its intention to exercise its redemption rights and redeemed the convertible bonds, which were paid to Teva in July 2024 (see note 2).

Financial instruments not measured at fair value
Financial instruments measured on a basis other than fair value mostly consist of senior notes, sustainability-linked senior notes and convertible senior debentures (see note 7) and are presented in the table below in terms of fair value (level 1 inputs):

|  | Estimated fair value* |
|  | September 30, 2025 |  |  | December 31, 2024 |
|  | (U.S. $ in millions) |
Senior notes and sustainability-linked senior notes included under senior notes and loans |  | $ | 16,808 |  |  | $ | 15,717 |
Senior notes and convertible senior debentures included under short-term debt |  |  | 23 |  |  |  | 1,779 |
Total |  | $ | 16,831 |  |  | $ | 17,496 |

* | The fair value was estimated based on quoted market prices.

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TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Notes to Consolidated Financial Statements
(Unaudited)
NOTE 17 – Redeemable
Non-Controlling
Interests:
In December 2024, Teva entered into an agreement with JKI Co., Ltd. (“JKI”) established by the fund managed and operated by private equity firm
J-Will
Partners Co., Ltd.
(“J-Will”),
through which JKI will acquire Teva-Takeda, Teva’s business venture in Japan (the “BV”), which includes generic products and legacy products. This transaction was completed on March 31, 2025.
Since the establishment of the BV and until the completion of the BV’s sale on March 31, 2025, Teva held 51% of the outstanding common stock of the BV, and as a result, Teva consolidated the BV in its financial statements during that period. On March 31, 2025, after the sale of the BV was completed, Teva deconsolidated the BV from its financial statements.
Pursuant to existing agreements with the minority investors of the BV, a redemption feature exists whereby the interest held by the minority investors is redeemable as a result of a sale of the BV, subject to certain terms listed therein. The redemption value would be determined based on a prescribed formula derived from the consideration received from the sale of the BV.
The balance of the redeemable
non-controlling
interest is reported at the greater of the initial carrying amount adjusted for the redeemable
non-controlling
interest’s share of earnings or losses and other comprehensive income or loss, or its estimated redemption value. The resulting changes in the estimated redemption amount (increases or decreases) are recorded with corresponding adjustments against retained earnings or, in the absence of retained earnings, additional
paid-in-capital.
Since the share redemption feature does not include a share cap, these interests are presented on the consolidated balance sheets outside of permanent equity under the caption “Redeemable
non-controlling
interest”.
Commensurate with the sale of the BV, Teva redeemed the remaining balance of the redeemable
non-controlling
interest with consideration of $38 million, following which, such balance was zero, as of March 31, 2025.
Changes in the carrying amount of the redeemable
non-controlling
interests for the period ended September 30, 2025 were as follows:

|  | Redeemable non-controlling interests |
|  | (U.S. $ in millions) |
Balance as of December 31, 2024 |  | $ | 340 |
Changes during the period: |  |  |  |
Share in comprehensive income (loss) |  |  | 33 |
Dividend payment |  |  | (340 | )
Purchase of shares from redeemable non-controlling interests |  |  | (38 | )
Other adjustments related to redeemable non-controlling interests |  |  | 6 |
Balance as of September 30, 2025 |  | $ | — |

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ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Business Overview

We are transforming into a leading innovative biopharmaceutical company, enabled by a world-class generics business. For over 120 years, our commitment to bettering health has never wavered. From innovating in the fields of neuroscience and immunology to providing complex generic medicines, biosimilars and pharmacy brands worldwide, we are dedicated to addressing patients’ needs, now and in the future.

Teva was incorporated in Israel on February 13, 1944 and is the successor to a number of Israeli corporations, the oldest of which was established in 1901.

Our Business Segments

We operate our business through three segments: United States, Europe and International Markets. Each business segment manages our entire product portfolio in its region, including generics, which includes biosimilars and OTC products, as well as innovative medicines. This structure enables strong alignment and integration between operations, commercial regions, R&D and our global marketing and portfolio function, optimizing our product lifecycle across therapeutic areas.

In addition to these three segments, we have other activities, primarily the sale of API to third parties, certain contract manufacturing services and an out-licensing platform offering a portfolio of products to other pharmaceutical companies through our affiliate Medis. Such activities are included under “Other Activities” below. For additional segment information, see note 15 to our consolidated financial statements.

Pivot to Growth Strategy

In the third quarter of 2025, we continued to execute on the four key pillars of our “Pivot to Growth” strategy, announced in May 2023, which entered into its second phase in 2025. During this second phase of “Accelerate Growth,” we expect to focus on growing our innovative portfolio, aligning capital allocation to invest in activities we expect to have the highest value, and modernizing our organization and operations to drive both efficiency and cost savings. Under Teva’s Transformation programs announced on May 7, 2025, we expect to achieve such cost savings through a variety of initiatives including examining practices and efficiencies in methods of working, reduction in headcount and optimizing external spend in the following years.

Macroeconomic Environment

In recent years, the global economy has been impacted by fluctuating foreign exchange rates. In the third quarter of 2025, a significant portion of our revenues were denominated in currencies other than the U.S. dollar and we manufacture many of our products outside of the United States. Fluctuations in the U.S. dollar versus other currencies in which we operate have in the past and may in the future materially impact our revenues, results of operations, profits and cash flows. Additionally, in recent years, in many of the markets in which we operate, we experienced higher levels of inflation resulting in higher interest rates, though in certain other markets, such as the EU, we recently experienced a decrease in inflation which resulted in lower interest rates. Although inflationary and other macroeconomic pressures have and may continue to ease, the higher costs we have experienced during recent periods have already impacted our operations and may continue to have an effect on our financial results. Recent U.S. tariffs imposed or threatened to be imposed on materials and products from countries where we do business and any responsive or reciprocal actions taken by such countries could impact our costs and our global operations. The countries which will be subject to tariffs and the tariff rate that may be imposed on each country is uncertain and dynamic, and we continue to monitor and assess the potential impact on our supply chain and global operations.

Highlights

Significant highlights in the third quarter of 2025 included:

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| • |  | Revenues in the third quarter of 2025 were $4,480 million, an increase of 3% in U.S. dollars, or 1% in local currency terms compared to the third quarter of 2024. This increase was mainly due to higher revenues from AUSTEDO and from generic products including biosimilars in our U.S. segment, partially offset by lower revenues from generic products in our International Markets segment due to the divestment of our business venture in Japan, from generic products in our Europe segment and from certain other innovative products across all our segments, as well as lower year-over-year proceeds from the sale of certain product rights.

| • |  | Our U.S. segment generated revenues of $2,483 million and segment profit of $937 million in the third quarter of 2025. Revenues increased by 12% and segment profit increased by 25%, compared to the third quarter of 2024.

| • |  | Our Europe segment generated revenues of $1,235 million and segment profit of $303 million in the third quarter of 2025. Revenues decreased by 2% in U.S. dollars, or 10% in local currency terms, compared to the third quarter of 2024. Segment profit decreased by 19%, compared to the third quarter of 2024.

| • |  | Our International Markets segment generated revenues of $557 million and segment profit of $95 million in the third quarter of 2025. Revenues decreased by 9% in U.S. dollars, or 10% in local currency terms, compared to the third quarter of 2024. Segment profit decreased by 13%, compared to the third quarter of 2024.

| • |  | Our revenues from other activities in the third quarter of 2025 were $205 million, a decrease of 10% in U.S. dollars, or 13% in local currency terms, compared to the third quarter of 2024.

| • |  | Exchange rate movements during the third quarter of 2025, including hedging effects, positively impacted our revenues by $106 million, compared to the third quarter of 2024.

| • |  | Gross profit margin was 51.4% in the third quarter of 2025, compared to 49.6% in the third quarter of 2024.

| • |  | R&D expenses, net in the third quarter of 2025 were $256 million, an increase of 7%, compared to $240 million in the third quarter of 2024.

| • |  | Impairments of identifiable intangible assets were $64 million in the third quarter of 2025, compared to $28 million in the third quarter of 2024. See note 5 to our consolidated financial statements.

| • |  | We recorded legal settlements and loss contingencies of $60 million in the third quarter of 2025, compared to $450 million in the third quarter of 2024. See note 9 to our consolidated financial statements.

| • |  | Operating income was $882 million in the third quarter of 2025, compared to an operating loss of $51 million in the third quarter of 2024.

| • |  | In the third quarter of 2025, we recognized a tax expense of $214 million, on a pre-tax income of $646 million. In the third quarter of 2024, we recognized a tax expense of $69 million, on a pre-tax loss of $324 million. See note 11 to our consolidated financial statements.

| • |  | As of September 30, 2025, our debt was $16,790 million, compared to $17,783 million as of December 31, 2024. See note 7 to our consolidated financial statements.

| • |  | Cash flow generated from operating activities during the third quarter of 2025 was $369 million, compared to $693 million in the third quarter of 2024. The lower cash flow generated from operating activities in the third quarter of 2025 was mainly due to timing of sales and collections, as well as higher legal settlement payments, partially offset by lower tax payments and higher profit.

| • |  | During the third quarter of 2025, we generated free cash flow of $515 million, which we define as comprising $369 million in cash flow generated from operating activities, $274 million in beneficial interest collected in exchange for securitized accounts receivables (under our EU securitization program) and $8 million of proceeds from divestitures of businesses and other assets, partially offset by $136 million in cash used for capital investment. During the third quarter of 2024, we generated free cash flow of $922 million. The decrease in the third quarter of 2025 mainly resulted from lower cash flow generated from operating activities, as well as a decrease in proceeds from divestitures of businesses and other assets.

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Results of Operations

Comparison of Three Months Ended September 30, 2025 to Three Months Ended September 30, 2024

Segment Information

United States Segment

The following table presents revenues, expenses and profit for our United States segment for the three months ended September 30, 2025 and 2024:

|  | Three months ended September 30, |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions / % of Segment Revenues) |
Revenues |  | $ | 2,483 |  |  |  | 100 | % |  | $ | 2,225 |  |  |  | 100 | %
Cost of sales |  |  | 996 |  |  |  | 40.1 | % |  |  | 960 |  |  |  | 43.1 | %
Gross profit |  |  | 1,486 |  |  |  | 59.9 | % |  |  | 1,265 |  |  |  | 56.9 | %
R&D expenses |  |  | 161 |  |  |  | 6.5 | % |  |  | 151 |  |  |  | 6.8 | %
S&M expenses |  |  | 278 |  |  |  | 11.2 | % |  |  | 259 |  |  |  | 11.6 | %
G&A expenses |  |  | 114 |  |  |  | 4.6 | % |  |  | 107 |  |  |  | 4.8 | %
Other |  |  | (3 | ) |  |  |  | § |  |  |  | § |  |  |  | §
Segment profit* |  | $ | 937 |  |  |  | 37.7 | % |  | $ | 748 |  |  |  | 33.6 | %

* | Segment profit does not include amortization and certain other items.

§ | Represents an amount less than $0.5 million or 0.5%, as applicable.

United States Revenues

Revenues from our United States segment in the third quarter of 2025 were $2,483 million, an increase of $257 million, or 12%, compared to the third quarter of 2024. This increase was mainly due to higher revenues from our key innovative products, primarily AUSTEDO, and generic products including biosimilars.

Revenues by Major Products and Activities

The following table presents revenues for our United States segment by major products and activities for the three months ended September 30, 2025 and 2024:

|  | Three months ended September 30, |  |  | Percentage Change 2025-2024 |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions) |  |  |  |
Generic products (including biosimilars) |  | $ | 1,175 |  |  | $ | 1,094 |  |  |  | 7 | %
AJOVY |  |  | 73 |  |  |  | 58 |  |  |  | 27 | %
AUSTEDO |  |  | 601 |  |  |  | 435 |  |  |  | 38 | %
BENDEKA and TREANDA |  |  | 35 |  |  |  | 40 |  |  |  | (13 | %)
COPAXONE |  |  | 62 |  |  |  | 69 |  |  |  | (9 | %)
UZEDY |  |  | 43 |  |  |  | 35 |  |  |  | 24 | %
Anda |  |  | 392 |  |  |  | 380 |  |  |  | 3 | %
Other |  |  | 101 |  |  |  | 115 |  |  |  | (13 | %)
Total |  | $ | 2,483 |  |  | $ | 2,225 |  |  |  | 12 | %

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##### Table of Contents

Generic products (including biosimilars) revenues in our United States segment in the third quarter of 2025 were $1,175 million, an increase of 7% compared to the third quarter of 2024. This increase was mainly driven by higher revenues from our portfolio of biosimilar products.

Among the most significant generic products we sold in the United States in the third quarter of 2025 were lenalidomide capsules (the generic version of Revlimid®), epinephrine injectable solution (the generic equivalent of EpiPen® and EpiPen Jr®) and Truxima® (the biosimilar to Rituxan®). In the third quarter of 2025, our total prescriptions were approximately 261 million (based on trailing twelve months), representing 6.7% of total U.S. generic prescriptions, compared to approximately 292 million (based on trailing twelve months), representing 7.6% of total U.S. generic prescriptions in the third quarter of 2024, all according to IQVIA data.

On August 28, 2025, we announced the FDA approval and launch in the U.S. of liraglutide injection (the generic version of Saxenda®), which is the first generic GLP-1 indicated for weight loss. Liraglutide injection is a glucagon like peptide 1 (GLP-1) receptor agonist indicated in combination with a reduced calorie diet and increased physical activity to reduce excess body weight and maintain weight reduction long-term in adult and pediatric patients aged 12 years and older.

AJOVY revenues in our United States segment in the third quarter of 2025 were $73 million, an increase of 27% compared to the third quarter of 2024, mainly due to growth in volume. In the third quarter of 2025, AJOVY’s exit market share in the United States in terms of total number of prescriptions was 32.0% out of the subcutaneous injectable anti-CGRP class, compared to 29.1% in the third quarter of 2024.

AJOVY was launched in the U.S. in 2018 for the preventive treatment of migraine in adults. In August 2025, the FDA approved AJOVY for the preventive treatment of episodic migraine in children and adolescent patients aged 6 to 17 years. AJOVY is the only anti-CGRP subcutaneous product indicated for both quarterly and monthly dosing options.

AJOVY is protected worldwide by patents expiring in 2026 at the earliest; extensions have been granted in several countries, including the United States and in Europe, until 2031. Additional patents relating to the use of AJOVY in the treatment of migraine have also been issued in the United States and Europe and will expire between 2035 and 2039. Such patents are also pending in other countries. AJOVY will also be protected by regulatory exclusivity for 12 years from marketing approval in the United States (obtained in September 2018) and 10 years from marketing approval in Europe (obtained in April 2019). For our patent litigation related to other anti-CGRP products, see note 10 to our consolidated financial statement.

AUSTEDO revenues (which include AUSTEDO XR®) in our United States segment in the third quarter of 2025 were $601 million, an increase of 38%, compared to $435 million in the third quarter of 2024. This increase was mainly due to growth in volume.

During the third quarter of 2025, Teva and the Centers for Medicare and Medicaid Services (“CMS”) negotiated a maximum fair price for the AUSTEDO products, based on CMS’s list of prescription medicines selected for price-setting discussions, in which they were originally included. The agreement is expected to be announced by CMS in November 2025. The revised prices set by the U.S. Government will become effective January 1, 2027 and will apply to eligible Medicare patients.

AUSTEDO was launched in the U.S. in 2017. It is indicated for the treatment of chorea associated with Huntington’s disease and for the treatment of tardive dyskinesia in adults.

AUSTEDO is protected in the United States by 14 Orange Book patents expiring between 2031 and 2038. We received notice letters from two ANDA filers regarding the filing of their ANDAs with paragraph (IV) certifications for certain of the patents listed in the Orange Book for AUSTEDO. In 2022, we reached agreements with Lupin and Aurobindo, respectively, to sell their generic products beginning in April 2033, or earlier under certain circumstances. On March 9, 2022, the U.S. Patent and Trial Appeal Board of the U.S. Patent and Trademark Office declined to institute an IPR filed by Apotex regarding the deutetrabenazine compound patent. Currently, there are no further patent litigations pending regarding AUSTEDO.

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AUSTEDO XR (deutetrabenazine) extended-release tablets was approved by the FDA on February 17, 2023 in three doses of 6, 12 and 24 mg, and became commercially available in the U.S. in May 2023. The FDA approved AUSTEDO XR as a one pill, once-daily treatment option in doses of 30, 36, 42, and 48 mg in May 2024 and in 18 mg dose in July 2024. AUSTEDO XR is a once-daily formulation indicated in adults for tardive dyskinesia and chorea associated with Huntington’s disease, which is additional to the currently marketed twice-daily AUSTEDO. AUSTEDO XR is protected by 11 Orange Book patents expiring between 2031 and 2041.

UZEDY (risperidone) extended-release injectable suspension revenues in our United States segment in the third quarter of 2025 were $43 million, an increase of 24% compared to the third quarter of 2024, mainly due to growth in volume.

UZEDY was approved by the FDA on April 28, 2023 for the treatment of schizophrenia in adults, and was launched in the U.S. in May 2023. UZEDY is a subcutaneous, long-acting formulation that controls the steady release of risperidone. UZEDY is protected by six Orange Book patents expiring between 2027 and 2042. On October 10, 2025, it was announced that the FDA approved UZEDY as a once-monthly extended-release injectable suspension as monotherapy or as adjunctive therapy to lithium or valproate for the maintenance treatment of bipolar 1 disorder (BD-1) in adults. UZEDY is protected by regulatory exclusivity until April 28, 2026. We are evaluating plans to launch UZEDY in other countries around the world. UZEDY faces competition from multiple products.

BENDEKA and TREANDA combined revenues in our United States segment in the third quarter of 2025 were $35 million, a decrease of 13% compared to the third quarter of 2024, mainly due to competition from alternative therapies, as well as from generic bendamustine products.

In April 2019, we signed an amendment to the license agreement with Eagle extending the royalty term applicable to the United States to the full period for which we sell BENDEKA and increased the royalty rate. In consideration, Eagle agreed to assume a portion of BENDEKA-related patent litigation expenses.

There are 20 patents listed in the U.S. Orange Book for BENDEKA with expiration dates in 2026 and 2031. In August 2021, the Court of Appeals for the Federal Circuit affirmed the district court’s decision upholding the validity of all of the asserted patents and finding infringement by two remaining ANDA filers. Another ANDA filer did not join the appeal, and Teva also settled with two ANDA filers.

Teva also settled litigation against three 505(b)(2) applicants, Hospira, Inc. (“Hospira”), Dr. Reddy’s Laboratories (“DRL”) and Accord Healthcare (“Accord”). Based on these settlement agreements, Hospira, Accord and DRL can launch their products on November 17, 2027, or earlier under certain circumstances. In 2023, Teva and Eagle also filed suit against BendaRx Corp. in the U.S. District Court for the District of Delaware, following its filing of a 505(b)(2) NDA for a bendamustine product, and that litigation is still pending. Similarly, on September 18, 2025, Teva and Eagle filed suit against Almaject, Inc. and Alvogen, Inc. in the District of Delaware following the filing of another 505(b)(2) NDA for a generic BENDEKA product.

In addition to the settlement with Eagle regarding its bendamustine 505(b)(2) NDA, between 2015 and 2020, we reached final settlements with 22 ANDA filers for generic versions of the lyophilized form of TREANDA and one 505(b)(2) NDA filer for a generic version of the liquid form of TREANDA, providing for the launch of generic versions of TREANDA prior to patent expiration. Currently, there are multiple generic TREANDA products on the market.

COPAXONE revenues in our United States segment in the third quarter of 2025 were $62 million, a decrease of 9% compared to the third quarter of 2024, mainly due to competition.

The market for multiple sclerosis treatments continues to develop, particularly with the approval of generic versions of COPAXONE. Oral branded and generic treatments for multiple sclerosis, continue to present significant and increasing competition. COPAXONE also continues to face competition from existing injectable products, as well as from monoclonal antibodies.

Anda revenues from third-party products in our United States segment in the third quarter of 2025 were $392 million, an increase of 3%, compared to $380 million in the third quarter of 2024. This increase was mainly due to higher volumes. Anda, our distribution business in the United States, distributes generic and innovative medicines and OTC pharmaceutical products from Teva and various third-party manufacturers to independent retail pharmacies, pharmacy retail chains, hospitals and physician offices in the United States.

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Anda competes in the distribution market by maintaining a broad portfolio of products, competitive pricing and delivery throughout the United States.

Product Launches and Pipeline

In the third quarter of 2025, we launched the generic version of the following branded products in the United States:

Product Name |  | Brand Name |  | Launch Date |  | Total Annual U.S. Branded Sales at Time of Launch (U.S. $ in millions (IQVIA))* |
Dasatinib Tablets |  | Sprycel® Tablets |  | September |  | $ | 1,366 |
Fidaxomicin Tablets |  | Dificid® tablets |  | July |  | $ | 410 |
Liraglutide Injection |  | Saxenda® injection |  | August |  | $ | 164 |
Azelastine Hydrochloride and Fluticasone Propionate Nasal Spray |  | Dymista® Nasal Spray |  | September |  | $ | 69 |

* | The figures presented are for the twelve months ended in the calendar quarter immediately prior to our launch or re-launch.

As of September 30, 2025, our generic products pipeline in the United States includes 123 product applications awaiting FDA approval, including 68 tentative approvals. This total reflects all pending ANDAs, supplements for product line extensions and tentatively approved applications and includes some instances where more than one application was submitted for the same reference product. Excluding overlaps, the branded products underlying these pending applications had U.S. sales for the twelve months ended June 30, 2025 of approximately $123 billion, according to IQVIA. Approximately 74% of pending applications include a paragraph IV patent challenge, and we believe we are first-to-file with respect to 55 of these products, or 80 products including final approvals where launch is pending a settlement agreement or court decision. Collectively, these first-to-file opportunities represent over $76 billion in U.S. brand sales for the twelve months ended June 30, 2025, according to IQVIA.

IQVIA reported brand sales are one of the many indicators of future potential value of a launch, but equally important are the mix and timing of competition, as well as cost effectiveness. The potential advantages of being the first filer with respect to some of these products may be either forfeited, or subject to shared exclusivity or competition from so-called “authorized generics,” which may ultimately affect the value derived.

In the third quarter of 2025, we received tentative approvals for generic equivalents of the products listed in the table below, excluding overlapping applications. A “tentative approval” indicates that the FDA has substantially completed its review of an application and final approval is expected once the relevant patent expires, a court decision is reached, a 30-month regulatory stay lapses or a 180-day exclusivity period awarded to another manufacturer either expires or is forfeited.

Generic Name |  | Brand Name |  | Total Annual U.S. Branded Sales at Time of Launch (U.S. $ in millions (IQVIA))* |
Nintedanib Capsules, 100 mg and 150 mg |  | Ofev® |  | $ | 3,280 |
Macitentan Tablets |  | Opsumit® |  | $ | 1,181 |
Elagolix, Estradiol and Norethindrone Acetate Capsules, 300 mg / 1 mg / 0.5 mg; Elagolix Capsules, 300 mg |  | Oriahnn® |  | $ | 11 |

* | The figures presented are for the twelve months ended in the calendar quarter immediately prior to our launch or re-launch.

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For information regarding our innovative and biosimilar products pipeline, see “—Teva Consolidated Results—Research and Development (R&D) Expenses, net” below.

United States Gross Profit

Gross profit from our United States segment in the third quarter of 2025 was $1,486 million, an increase of 17%, compared to $1,265 million in the third quarter of 2024.

Gross profit margin for our United States segment in the third quarter of 2025 increased to 59.9%, compared to 56.9% in the third quarter of 2024. This increase was mainly due to a favorable mix of products primarily driven by higher revenues from AUSTEDO.

United States R&D Expenses

R&D expenses relating to our United States segment in the third quarter of 2025 were $161 million, an increase of 6%, compared to $151 million in the third quarter of 2024.

For a description of our R&D expenses in the third quarter of 2025, see “—Teva Consolidated Results—Research and Development (R&D) Expenses, net” below.

United States S&M Expenses

S&M expenses relating to our United States segment in the third quarter of 2025 were $278 million, an increase of 8%, compared to $259 million in the third quarter of 2024. This increase was mainly due to promotional activities related to our key innovative products.

United States G&A Expenses

G&A expenses relating to our United States segment in the third quarter of 2025 were $114 million, an increase of 6% compared to $107 million in the third quarter of 2024.

For a description of our G&A expenses in the third quarter of 2025, see “—Teva Consolidated Results—General and Administrative (G&A) Expenses” below.

United States Profit

Profit from our United States segment consists of revenues less cost of sales, R&D expenses, S&M expenses, G&A expenses and other expenses (income) related to this segment. Segment profit does not include amortization and certain other items.

Profit from our United States segment in the third quarter of 2025 was $937 million, an increase of 25% compared to $748 million in the third quarter of 2024. This increase was mainly due to higher gross profit, as discussed above.

Europe Segment

The following table presents revenues, expenses and profit for our Europe segment for the three months ended September 30, 2025 and 2024:

|  | Three months ended September 30, |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions / % of Segment Revenues) |
Revenues |  | $ | 1,235 |  |  |  | 100 | % |  | $ | 1,265 |  |  |  | 100 | %
Cost of sales |  |  | 570 |  |  |  | 46.1 | % |  |  | 566 |  |  |  | 44.8 | %
Gross profit |  |  | 665 |  |  |  | 53.9 | % |  |  | 698 |  |  |  | 55.2 | %
R&D expenses |  |  | 62 |  |  |  | 5.0 | % |  |  | 55 |  |  |  | 4.3 | %
S&M expenses |  |  | 225 |  |  |  | 18.2 | % |  |  | 203 |  |  |  | 16.0 | %
G&A expenses |  |  | 75 |  |  |  | 6.1 | % |  |  | 67 |  |  |  | 5.3 | %
Other |  |  |  | § |  |  |  | § |  |  | 1 |  |  |  |  | §
Segment profit* |  | $ | 303 |  |  |  | 24.5 | % |  | $ | 373 |  |  |  | 29.5 | %

* | Segment profit does not include amortization and certain other items.

§ | Represents an amount less than $0.5 million or 0.5%, as applicable.

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Europe Revenues

Our Europe segment includes the European Union, the United Kingdom and certain other European countries.

Revenues from our Europe segment in the third quarter of 2025 were $1,235 million, a decrease of 2%, or $30 million, compared to the third quarter of 2024. In local currency terms, revenues decreased by 10% compared to the third quarter of 2024, mainly due to higher proceeds from the sale of certain product rights in the third quarter of 2024, and lower revenues from generic products, partially offset by higher revenues from AJOVY.

In the third quarter of 2025, revenues were positively impacted by exchange rate fluctuations of $91 million, including hedging effects, compared to the third quarter of 2024. Revenues in the third quarter of 2025, included $6 million from a positive hedging impact, which is included in “Other” in the table below. Revenues in the third quarter of 2024 included $10 million from a negative hedging impact, which is included in “Other” in the table below. See note 8d to our consolidated financial statements.

Revenues by Major Products and Activities

The following table presents revenues for our Europe segment by major products and activities for the three months ended September 30, 2025 and 2024:

|  | Three months ended September 30, |  |  | Percentage Change 2025-2024 |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions) |  |  |  |
Generic products (including OTC and biosimilars) |  | $ | 982 |  |  | $ | 973 |  |  |  | 1 | %
AJOVY |  |  | 66 |  |  |  | 56 |  |  |  | 18 | %
COPAXONE |  |  | 44 |  |  |  | 53 |  |  |  | (18 | %)
Respiratory products |  |  | 52 |  |  |  | 60 |  |  |  | (13 | %)
Other* |  |  | 91 |  |  |  | 124 |  |  |  | (26 | %)
Total |  | $ | 1,235 |  |  | $ | 1,265 |  |  |  | (2 | %)

* | Other revenues in the third quarter of 2025 and 2024 include the sale of certain product rights.

Generic products revenues (including OTC and biosimilar products) in our Europe segment in the third quarter of 2025, were $982 million, an increase of 1% compared to the third quarter of 2024. In local currency terms, revenues decreased by 5%, mainly due to lower volumes and price reductions as a result of market dynamics and lower sales of seasonal OTC products, partially offset by higher revenues from recently launched products.

AJOVY revenues in our Europe segment in the third quarter of 2025 increased by 18% to $66 million, compared to $56 million in the third quarter of 2024. In local currency terms revenues increased by 11% due to growth in volume.

For information about AJOVY patent protection, see “—United States Revenues—Revenues by Major Products and Activities” above.

COPAXONE revenues in our Europe segment in the third quarter of 2025 were $44 million, a decrease of 18% compared to the third quarter of 2024. In local currency terms revenues decreased by 23%, due to price reductions and lower volumes resulting from the availability of alternative therapies. In certain countries, Teva remains in litigation against generic companies regarding COPAXONE.

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Respiratory products revenues in our Europe segment in the third quarter of 2025 were $52 million, a decrease of 13% compared to the third quarter of 2024. In local currency terms, revenues decreased by 18%, mainly due to net price reductions and lower volumes associated with the availability of alternative therapies.

Product Launches and Pipeline

As of September 30, 2025, our generic products pipeline in Europe included 496 generic approvals relating to 42 compounds in 87 formulations, with no European Medicines Agency (“EMA”) approvals received. In addition, approximately 1,548 marketing authorization applications are pending approval in 37 European countries, relating to 95 compounds in 216 formulations. No applications are pending with the EMA.

For information regarding our innovative medicines and biosimilar products pipeline, see “—Teva Consolidated Results—Research and Development (R&D) Expenses, net” below.

Europe Gross Profit

Gross profit from our Europe segment in the third quarter of 2025 was $665 million, a decrease of 5% compared to $698 million in the third quarter of 2024.

Gross profit margin for our Europe segment in the third quarter of 2025 decreased to 53.9%, compared to 55.2% in the third quarter of 2024. This decrease was mainly due to higher proceeds from the sale of certain product rights in the third quarter of 2024, and an unfavorable mix of products, partially offset by a positive impact from hedging activities.

Europe R&D Expenses

R&D expenses relating to our Europe segment in the third quarter of 2025 were $62 million, an increase of 12% compared to $55 million in the third quarter of 2024.

For a description of our R&D expenses in the third quarter of 2025, see “—Teva Consolidated Results—Research and Development (R&D) Expenses, net” below.

Europe S&M Expenses

S&M expenses relating to our Europe segment in the third quarter of 2025 were $225 million, an increase of 11% compared to $203 million in the third quarter of 2024. This increase was mainly due to exchange rate fluctuations, as well as to support revenue growth of our generic and key innovative products, including new launches.

Europe G&A Expenses

G&A expenses relating to our Europe segment in the third quarter of 2025 were $75 million, an increase of 12% compared to $67 million in the third quarter of 2024.

For a description of our G&A expenses in the third quarter of 2025, see “—Teva Consolidated Results—General and Administrative (G&A) Expenses” below.

Europe Profit

Profit from our Europe segment consists of revenues less cost of sales, R&D expenses, S&M expenses, G&A expenses and other expenses (income) related to this segment. Segment profit does not include amortization and certain other items.

Profit from our Europe segment in the third quarter of 2025 was $303 million, a decrease of 19%, compared to $373 million in the third quarter of 2024. This decrease was mainly due to lower gross profit and higher S&M expenses, as discussed above.

International Markets Segment

The following table presents revenues, expenses and profit for our International Markets segment for the three months ended September 30, 2025 and 2024:

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|  | Three months ended September 30, |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions / % of Segment Revenues) |
Revenues |  | $ | 557 |  |  |  | 100 | % |  | $ | 613 |  |  |  | 100 | %
Cost of sales |  |  | 280 |  |  |  | 50.2 | % |  |  | 307 |  |  |  | 50.1 | %
Gross profit |  |  | 278 |  |  |  | 49.8 | % |  |  | 306 |  |  |  | 49.9 | %
R&D expenses |  |  | 26 |  |  |  | 4.6 | % |  |  | 27 |  |  |  | 4.4 | %
S&M expenses |  |  | 122 |  |  |  | 21.9 | % |  |  | 134 |  |  |  | 21.9 | %
G&A expenses |  |  | 36 |  |  |  | 6.4 | % |  |  | 36 |  |  |  | 5.8 | %
Other |  |  |  | § |  |  |  | § |  |  |  | § |  |  |  | §
Segment profit* |  | $ | 95 |  |  |  | 17.0 | % |  | $ | 109 |  |  |  | 17.8 | %

* | Segment profit does not include amortization and certain other items.

§ | Represents an amount less than $0.5 million or 0.5%, as applicable.

International Markets Revenues

Our International Markets segment includes all countries in which we operate other than the United States and the countries included in our Europe segment. The International Markets segment covers a substantial portion of the global pharmaceutical industry, including more than 35 countries.

The countries in our International Markets segment include highly regulated, mainly generic markets, such as Canada and Israel, and branded generics-oriented markets, such as Russia and certain Latin America markets.

On March 31, 2025, we divested our Teva-Takeda business venture in Japan, which included generic products and legacy products. Since the establishment of the business venture and until the completion of its sale, Teva held 51% of the outstanding common stock of the business venture. On March 31, 2025, we deconsolidated the business venture from our financial statements. For additional information, see note 2 and note 17 to our consolidated financial statements.

As of the date of this Quarterly Report on Form 10-Q, sustained conflict between Russia and Ukraine and disruption in the region is ongoing. Russia and Ukraine markets are included in our International Markets segment results, and we have no manufacturing or R&D facilities in these markets. During the three months ended September 30, 2025, the impact of this conflict on our International Markets segment’s results of operations and financial condition was immaterial. Consistent with our foreign exchange risk management hedging programs, in the three months ended September 30, 2025, we partially hedged our exposure to currency exchange rate fluctuations with respect to our balance sheet assets, revenues and expenses. As of the end of the third quarter of 2025, we also hedge a small part of our projected net revenues in Russian rubles for 2025. Prior to and since the escalation of the conflict, we have been taking measures to reduce our operational cash balances in Russia and Ukraine. We have been monitoring the solvency of our customers in Russia and Ukraine and have taken measures, where practicable, to mitigate our exposure to risks related to the conflict in the region. However, the duration, severity and global implications (including potential inflation and devaluation consequences) of the conflict cannot be predicted at this time and could have an effect on our business, including on our exchange rate exposure, supply chain, operational costs and commercial presence in these markets.

Revenues from our International Markets segment in the third quarter of 2025 were $557 million, a decrease of 9% compared to the third quarter of 2024. In local currency terms, revenues decreased by 10% compared to the third quarter of 2024. This decrease was mainly due to the divestment of our business venture in Japan, partially offset by higher revenues, mainly from generic products in other markets.

In the third quarter of 2025, revenues were positively impacted by exchange rate fluctuations of $9 million, including hedging effects, compared to the third quarter of 2024. Revenues in the third quarter of 2025 included $2 million from a positive hedging impact, compared to a positive hedging impact of $1 million in the third quarter of 2024, which are included in “Other” in the table below. See note 8d to our consolidated financial statements.

Revenues by Major Products and Activities

The following table presents revenues for our International Markets segment by major products and activities for the three months ended September 30, 2025 and 2024:

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|  | Three months ended September 30, |  |  | Percentage Change 2025-2024 |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions) |  |  |  |
Generic products (including OTC and biosimilars) |  | $ | 421 |  |  | $ | 477 |  |  |  | (12 | %)
AJOVY |  |  | 30 |  |  |  | 24 |  |  |  | 23 | %
AUSTEDO |  |  | 17 |  |  |  | 13 |  |  |  | 32 | %
COPAXONE |  |  | 8 |  |  |  | 13 |  |  |  | (40 | %)
Other* |  |  | 82 |  |  |  | 86 |  |  |  | (4 | %)
Total |  | $ | 557 |  |  | $ | 613 |  |  |  | (9 | %)

* | Other revenues in the third quarter of 2025 and 2024 include the sale of certain product rights.

Generic products revenues (including OTC and biosimilar products) in our International Markets segment were $421 million in the third quarter of 2025, a decrease of 12% in U.S. dollars. In local currency terms revenues decreased by 13%, compared to the third quarter of 2024, mainly due to the divestment of our business venture in Japan, partially offset by higher revenues in other markets.

AJOVY was launched in certain markets in our International Markets segment, including in Canada, Japan, Australia, Israel, South Korea, Brazil and others. AJOVY revenues in our International Markets segment in the third quarter of 2025 were $30 million, compared to $24 million in the third quarter of 2024. In local currency terms, revenues increased by 21%, mainly due to growth in existing markets in which AJOVY was launched.

AUSTEDO was launched in China and Israel in 2021 and in Brazil in 2022, for the treatment of chorea associated with Huntington’s disease and for the treatment of tardive dyskinesia. In February 2024, we announced a strategic partnership for the marketing and distribution of AUSTEDO in China with Jiangsu Nhwa Hexin Pharmaceutical Marketing Co., Ltd. In April 2025, AUSTEDO received marketing authorization in South Korea. We continue to evaluate additional submissions in various other markets.

AUSTEDO revenues in our International Markets segment in the third quarter of 2025 were $17 million compared to $13 million in the third quarter of 2024. In local currency terms, revenues increased by 31%.

COPAXONE revenues in our International Markets segment in the third quarter of 2025 were $8 million compared to $13 million in the third quarter of 2024.

International Markets Gross Profit

Gross profit from our International Markets segment in the third quarter of 2025 was $278 million, a decrease of 9% compared to $306 million in the third quarter of 2024.

Gross profit margin for our International Markets segment in the third quarter of 2025 decreased to 49.8%, compared to 49.9% in the third quarter of 2024.

International Markets R&D Expenses

R&D expenses relating to our International Markets segment in the third quarter of 2025 were $26 million, a decrease of 4% compared to the third quarter of 2024.

For a description of our R&D expenses in the third quarter of 2025, see “—Teva Consolidated Results—Research and Development (R&D) Expenses, net” below.

International Markets S&M Expenses

S&M expenses relating to our International Markets segment in the third quarter of 2025 were $122 million, a decrease of 9% compared to the third quarter of 2024, mainly due to the divestment of our business venture in Japan.

International Markets G&A Expenses

G&A expenses relating to our International Markets segment in the third quarter of 2025 were $36 million, flat compared to the third quarter of 2024.

International Markets Profit

Profit from our International Markets segment consists of revenues less cost of sales, R&D expenses, S&M expenses, G&A expenses and other expenses (income) related to this segment. Segment profit does not include amortization and certain other items.

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Profit from our International Markets segment in the third quarter of 2025 was $95 million, a decrease of 13%, compared to $109 million in the third quarter of 2024. This decrease was mainly due to the divestment of our business venture in Japan.

Other Activities

We have 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 our affiliate Medis. Our other activities are not included in our United States, Europe or International Markets segments described above.

On January 31, 2024, we announced that we intend to divest our API business (including its R&D, manufacturing and commercial activities) through a sale. The intention to divest is in alignment with our Pivot to Growth strategy. As of the date of this Quarterly Report on Form 10-Q, exclusive discussions with a selected buyer on the sale have terminated. Teva is initiating a renewed sales process, maintaining its strategic intention to divest its API business. 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. For further information, see note 2 to our consolidated financial statements.

Our revenues from other activities in the third quarter of 2025 were $205 million, a decrease of 10% in U.S. dollars, or 13% in local currency terms, compared to the third quarter of 2024, mainly due to a decrease in revenues from contract manufacturing services in the third quarter of 2025.

API sales to third parties in the third quarter of 2025 were $125 million, a decrease of 4% in both U.S. dollars and local currency terms, compared to the third quarter of 2024.

Teva Consolidated Results

Revenues

Revenues in the third quarter of 2025 were $4,480 million, an increase of 3% in U.S. dollars, or 1% in local currency terms compared to the third quarter of 2024. This increase was mainly due to higher revenues from AUSTEDO and from generic products including biosimilars in our U.S. segment, partially offset by lower revenues from generic products in our International Markets segment due to the divestment of our business venture in Japan, from generic products in our Europe segment and from certain other innovative products across all our segments, as well as lower year-over-year proceeds from the sale of certain product rights.

See “—United States Revenues,” “—Europe Revenues,” “—International Markets Revenues” and “—Other Activities” above.

Exchange rate movements during the third quarter of 2025, including hedging effects, positively impacted revenues by $106 million, compared to the third quarter of 2024. See note 8d to our consolidated financial statements.

Gross Profit

Gross profit in the third quarter of 2025 was $2,304 million, an increase of 7% compared to $2,148 million in the third quarter of 2024.

Gross profit margin was 51.4% in the third quarter of 2025, compared to 49.6% in the third quarter of 2024. This increase was mainly due to higher revenues from AUSTEDO.

Research and Development (R&D) Expenses, net

Our R&D activities for innovative medicines and biosimilar products in each of our segments include costs of discovery research, preclinical work, drug formulation, early- and late-stage clinical development and product registration costs. These expenditures are reported net of contributions received from collaboration partners. Our spending takes place throughout the development process, including (i) early-stage projects in both discovery and preclinical phases; (ii) middle-stage projects in clinical programs up to Phase 3; (iii) late-stage projects in Phase 3 programs, including where a new drug application is currently pending approval; (iv) post-approval studies for marketed products; and (v) indirect expenses, such as costs of infrastructure and personnel.

Our R&D activities for generic products in each of our segments include both (i) direct expenses relating to product formulation, analytical method development, stability testing, management of bioequivalence and other clinical studies and regulatory filings; and (ii) indirect expenses, such as costs of infrastructure and personnel.

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In the third quarter of 2025, our R&D expenses, net primarily related to innovative product candidates and marketed products in immunology, neuroscience and selected other areas, as well as generic products and biosimilars.

R&D expenses, net in the third quarter of 2025, were $256 million, an increase of 7% compared to $240 million in the third quarter of 2024.

Our higher R&D expenses, net in the third quarter of 2025 compared to the third quarter of 2024, were mainly due to an increase in immunology projects, partially offset by a decrease in our late-stage innovative pipeline in neuroscience (mainly neuropsychiatry), which was also impacted by a reimbursement from our strategic partnerships in the third quarter of 2024.

Our R&D expenses, net in the third quarter of 2025, were also impacted by reimbursements from the strategic partnerships we entered into in 2023 and 2024. See note 2 to our consolidated financial statements.

R&D expenses, net as a percentage of revenues were 5.7% in the third quarter of 2025, compared to 5.5% in the third quarter of 2024.

Innovative Medicines Pipeline

Below is a description of key products in our innovative medicines pipeline as of November 5, 2025:

|  | Phase 2 |  | Phase 3
Neuroscience |  |  |  | olanzapine LAI (TEV-‘749) Schizophrenia (September 2022)
Immunology |  | Anti-IL-15 (TEV-’408) Celiac disease |  | Dual Action Rescue Inhaler (DARI) (ICS/SABA; TEV-’248) (1) Asthma (February 2023)
| emrusolmin(2) (TEV-‘286) Multiple System Atrophy |  | duvakitug (anti-TL1A) (3) (TEV-’574) Inflammatory Bowel Disease (October 2025)

(1) | In collaboration with Launch Therapeutics.

(2) | In collaboration with Modag.

(3) | In collaboration with Sanofi.

Biosimilar Products Pipeline

We have additional biosimilar products in development internally and with our partners that are in various stages of clinical trials and regulatory review worldwide, including confirmatory clinical trials for biosimilars to Xolair® (omalizumab); to Entyvio® (vedolizymab) and Entyvio® SC (vedolizymab), which are in collaboration with Alvotech for the U.S. market; and TEV-‘333 and TEV-‘316, both in collaboration with mAbxience. Our proposed biosimilars to Prolia® (denosumab) and to Xgeva® (denosumab), were submitted for regulatory review in the U.S. and Europe. Our proposed biosimilars to Simponi®, Simponi Aria® (golimumab), and Eylea® (aflibercept), which are in collaboration with Alvotech, were submitted for regulatory review in the U.S.

Selling and Marketing (S&M) Expenses

S&M expenses in the third quarter of 2025 were $656 million, an increase of 5% compared to the third quarter of 2024. This increase was mainly a result of the factors discussed above under “—United States segment—S&M Expenses,” “—Europe segment— S&M Expenses” and “—International Markets segment— S&M Expenses.”

S&M expenses as a percentage of revenues were 14.7% in the third quarter of 2025, compared to 14.5% in the third quarter of 2024.

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General and Administrative (G&A) Expenses

G&A expenses in the third quarter of 2025 were $317 million, an increase of 6% compared to the third quarter of 2024. This increase was mainly due to costs related to optimization activities of Teva’s global organization and operations in connection with Teva’s Transformation programs, as well as a negative impact from exchange rate fluctuations.

G&A expenses as a percentage of revenues were 7.1% in the third quarter of 2025 compared to 6.9% in the third quarter of 2024.

Intangible Asset Impairments

We recorded expenses of $64 million for identifiable intangible asset impairments in the third quarter of 2025, compared to expenses of $28 million in the third quarter of 2024. See note 5 to our consolidated financial statements.

Goodwill Impairment

No goodwill impairment charges were recorded in the third quarter of 2025, compared to a goodwill impairment charge of $600 million in the third quarter of 2024 related to Teva’s API reporting unit. See note 6 to our consolidated financial statements.

Other Asset Impairments, Restructuring and Other Items

We recorded expenses of $62 million for other asset impairments, restructuring and other items in the third quarter of 2025, compared to an income of $23 million in the third quarter of 2024. See note 12 to our consolidated financial statements.

Legal Settlements and Loss Contingencies

We recorded expenses of $60 million in legal settlements and loss contingencies in the third quarter of 2025, compared to expenses of $450 million in the third quarter of 2024. See note 9 to our consolidated financial statements.

Other Loss (Income)

Other loss in the third quarter of 2025 was $7 million, compared to other income of $21 million in the third quarter of 2024. Other income in the third quarter of 2024 included a capital gain from the sale of a business in our International Markets segment.

Operating Income (Loss)

Operating income was $882 million in the third quarter of 2025, compared to an operating loss of $51 million in the third quarter of 2024. This increase was mainly due to the goodwill impairment charge and higher legal settlements and loss contingencies recorded in the third quarter of 2024.

Operating income as a percentage of revenues was 19.7% in the third quarter of 2025, compared to an operating loss as a percentage of revenues of 1.2% in the third quarter of 2024.

Financial Expenses, Net

In the third quarter of 2025, financial expenses, net were $237 million, mainly comprised of net interest expenses of $209 million. In the third quarter of 2024, financial expenses, net were $272 million, mainly comprised of net interest expenses of $225 million and a negative exchange rate impact, driven mainly from currencies which we were unable to hedge.

Reconciliation Table to Consolidated Income (Loss) Before Income Taxes

The following table presents a reconciliation of our segment profits to our consolidated operating income (loss) and to consolidated income (loss) before income taxes for the three months ended September 30, 2025 and 2024:

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|  | Three months ended September 30, |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions) |
United States profit |  | $ | 937 |  |  | $ | 748 |
Europe profit |  |  | 303 |  |  |  | 373 |
International Markets profit |  |  | 95 |  |  |  | 109 |
Total reportable segments profit |  |  | 1,334 |  |  |  | 1,230 |
Profit of other activities |  |  | (40 | ) |  |  | (16 | )
Total segments profit |  |  | 1,294 |  |  |  | 1,214 |
Amounts not allocated to segments: |  |  |  |  |  |  |  |
Amortization |  |  | 144 |  |  |  | 146 |
Other assets impairments, restructuring and other items |  |  | 62 |  |  |  | (23 | )
Goodwill impairment |  |  | — |  |  |  | 600 |
Intangible assets impairments |  |  | 64 |  |  |  | 28 |
Legal settlements and loss contingencies |  |  | 60 |  |  |  | 450 |
Other unallocated amounts |  |  | 82 |  |  |  | 64 |
Consolidated operating income (loss) |  |  | 882 |  |  |  | (51 | )
Financial expenses, net |  |  | 237 |  |  |  | 272 |
Consolidated income (loss) before income taxes |  | $ | 646 |  |  | $ | (324 | )

Income Taxes

In the third quarter of 2025, we recognized a tax expense of $214 million, on a pre-tax income of $646 million. In the third quarter of 2024, we recognized a tax expense of $69 million, on a pre-tax loss of $324 million. See note 11 to our consolidated financial statements.

Net Income (Loss) Attributable to Teva

Net income attributable to Teva was $433 million in the third quarter of 2025, compared to a net loss of $437 million in the third quarter of 2024. This change was mainly due to higher operating income in the third quarter of 2025, partially offset by higher income taxes, as discussed above.

Diluted Shares Outstanding and Earnings (Loss) per Share

The weighted average diluted shares outstanding used for the fully diluted share calculations for the three months ended September 30, 2025 and 2024 was 1,164 million shares and 1,133 million shares, respectively.

Diluted earnings per share was $0.37 in the third quarter of 2025, compared to diluted loss per share of $0.39 in the third quarter of 2024. See note 13 to our consolidated financial statements.

Share Count for Market Capitalization

We calculate share amounts using the outstanding number of shares (i.e., excluding treasury shares) plus shares that would be outstanding upon the exercise of options and vesting of RSUs and PSUs, and the conversion of our convertible senior debentures, in each case, at period end.

As of September 30, 2025 and 2024, the fully diluted share count for purposes of calculating our market capitalization was approximately 1,184 million shares and 1,167 million shares, respectively.

Impact of Currency Fluctuations on Results of Operations

In the third quarter of 2025, approximately 41% of our revenues were denominated in currencies other than the U.S. dollar. Since our results are reported in U.S. dollars, we are subject to significant foreign currency risks. Accordingly, changes in the rate of exchange between the U.S. dollar and local currencies in the markets in which we operate (primarily the euro, Russian ruble, British pound, Swiss franc, Canadian dollar, new Israeli shekel and Polish złoty) impacted our results.

During the third quarter of 2025, the following main currencies relevant to our operations increased in value against the U.S. dollar (each compared on a quarterly average basis): Russian ruble by 11%, new Israeli shekel by 10%, Swedish krona by 10%, Swiss franc by 8%, Polish złoty by 7%, euro by 6%, Bulgarian lev by 6%, Hungary forint by 6% and British pound by 4%. The following currencies relevant to our operations decreased in value against the U.S. dollar (each compared on a quarterly average basis): Argentinian peso by 30% and Turkish lira by 18%.

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As a result, exchange rate movements during the third quarter of 2025, including hedging effects, positively impacted revenues by $106 million and operating income by $21 million, compared to the third quarter of 2024.

Hedging transactions of future projected revenues and expenses are recognized on the balance sheet at their fair value on a quarterly basis, while the foreign exchange impact on the underlying revenues and expenses may occur in subsequent quarters. See note 8d to our consolidated financial statements.

Commencing in the third quarter of 2018, the cumulative inflation in Argentina exceeded 100% or more over a three-year period. Although this triggered highly inflationary accounting treatment, it did not have a material impact on our results of operations.

Commencing in the second quarter of 2022, the cumulative inflation in Turkey exceeded 100% or more over a three-year period. Although this triggered highly inflationary accounting treatment, it did not have a material impact on our results of operations.

Comparison of Nine Months Ended September 30, 2025 to Nine Months Ended September 30, 2024

Unless specified otherwise, the factors used to explain quarterly changes on a year-over-year basis are also relevant for the comparison of the results for the nine months ended September 30, 2025 and 2024. Where there are different factors affecting the nine-month comparison, we have described them below.

Segment Information

United States Segment

The following table presents revenues, expenses and profit for our United States segment for the nine months ended September 30, 2025 and 2024:

|  | Nine months ended September 30, |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions / % of Segment Revenues) |
Revenues |  | $ | 6,543 |  |  |  | 100 | % |  | $ | 6,060 |  |  |  | 100 | %
Cost of sales |  |  | 2,748 |  |  |  | 42.0 | % |  |  | 2,769 |  |  |  | 45.7 | %
Gross profit |  |  | 3,795 |  |  |  | 58.0 | % |  |  | 3,291 |  |  |  | 54.3 | %
R&D expenses |  |  | 467 |  |  |  | 7.1 | % |  |  | 475 |  |  |  | 7.8 | %
S&M expenses |  |  | 831 |  |  |  | 12.7 | % |  |  | 789 |  |  |  | 13.0 | %
G&A expenses |  |  | 323 |  |  |  | 4.9 | % |  |  | 300 |  |  |  | 5.0 | %
Other loss (income) |  |  | (1 | ) |  |  |  | § |  |  | (1 | ) |  |  |  | §
Segment profit* |  | $ | 2,175 |  |  |  | 33.2 | % |  | $ | 1,727 |  |  |  | 28.5 | %

* | Segment profit does not include amortization and certain other items.

§ | Represents an amount less than 0.5%.

United States Revenues

Revenues from our United States segment in the first nine months of 2025 were $6,543 million, an increase of 8% compared to $6,060 million in the first nine months of 2024.

Revenues by Major Products and Activities

The following table presents revenues for our United States segment by major products and activities for the nine months ended September 30, 2025 and 2024:

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|  | Nine months ended September 30, |  |  | Percentage Change 2025-2024 |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions) |  |  |  |
Generic products (including biosimilars) |  | $ | 2,984 |  |  | $ | 2,924 |  |  |  | 2 | %
AJOVY |  |  | 190 |  |  |  | 144 |  |  |  | 31 | %
AUSTEDO |  |  | 1,492 |  |  |  | 1,124 |  |  |  | 33 | %
BENDEKA and TREANDA |  |  | 111 |  |  |  | 127 |  |  |  | (13 | %)
COPAXONE |  |  | 179 |  |  |  | 179 |  |  |  |  | §
UZEDY |  |  | 136 |  |  |  | 75 |  |  |  | 82 | %
Anda |  |  | 1,130 |  |  |  | 1,134 |  |  |  |  | §
Other |  |  | 321 |  |  |  | 352 |  |  |  | (9 | %)
Total |  | $ | 6,543 |  |  | $ | 6,060 |  |  |  | 8 | %

§ | Represents an amount less than 0.5%.

United States Gross Profit

Gross profit from our United States segment in the first nine months of 2025 was $3,795 million, an increase of 15%, compared to $3,291 million in the first nine months of 2024.

Gross profit margin for our United States segment in the first nine months of 2025 increased to 58.0% compared to 54.3% in the first nine months of 2024.

United States R&D Expenses

R&D expenses relating to our United States segment in the first nine months of 2025 were $467 million, a decrease of 2%, compared to $475 million in the first nine months of 2024.

For a description of our R&D expenses in the first nine months of 2025, see “—Teva Consolidated Results—Research and Development (R&D) Expenses, net” below.

United States S&M Expenses

S&M expenses relating to our United States segment in the first nine months of 2025 were $831 million, an increase of 5%, compared to $789 million in the first nine months of 2024.

United States G&A Expenses

G&A expenses relating to our United States segment in the first nine months of 2025 were $323 million, an increase of 7%, compared to $300 million in the first nine months of 2024.

United States Profit

Profit from our United States segment in the first nine months of 2025 was $2,175 million, an increase of 26%, compared to $1,727 million in the first nine months of 2024.

Europe Segment

The following table presents revenues, expenses and profit for our Europe segment for the nine months ended September 30, 2025 and 2024:

|  | Nine months ended September 30, |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions / % of Segment Revenues) |
Revenues |  | $ | 3,726 |  |  |  | 100.0 | % |  | $ | 3,749 |  |  |  | 100.0 | %
Cost of sales |  |  | 1,687 |  |  |  | 45.3 | % |  |  | 1,637 |  |  |  | 43.7 | %
Gross profit |  |  | 2,039 |  |  |  | 54.7 | % |  |  | 2,113 |  |  |  | 56.3 | %
R&D expenses |  |  | 181 |  |  |  | 4.9 | % |  |  | 173 |  |  |  | 4.6 | %
S&M expenses |  |  | 652 |  |  |  | 17.5 | % |  |  | 605 |  |  |  | 16.1 | %
G&A expenses |  |  | 210 |  |  |  | 5.6 | % |  |  | 197 |  |  |  | 5.2 | %
Other loss (income) |  |  |  | § |  |  |  | § |  |  | 1 |  |  |  |  | §
Segment profit* |  | $ | 996 |  |  |  | 26.7 | % |  | $ | 1,137 |  |  |  | 30.3 | %

* | Segment profit does not include amortization and certain other items.

§ | Represents an amount less than $0.5 million or 0.5%, as applicable.

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Europe Revenues

Our Europe segment includes the European Union, the United Kingdom, and certain other European countries.

Revenues from our Europe segment in the first nine months of 2025 were $3,726 million, a decrease of $23 million, compared to the first nine months of 2024. In local currency terms, revenues decreased by 3% compared to the first nine months of 2024.

Revenues by Major Products and Activities

The following table presents revenues for our Europe segment by major products and activities for the nine months ended September 30, 2025 and 2024:

|  | Nine months ended September 30, |  |  | Percentage Change |
|  | 2025 |  |  | 2024 |  |  | 2025-2024 |
|  | (U.S. $ in millions) |
Generic products (including OTC and biosimilars) |  | $ | 3,011 |  |  | $ | 2,947 |  |  |  | 2 | %
AJOVY |  |  | 195 |  |  |  | 158 |  |  |  | 23 | %
COPAXONE |  |  | 135 |  |  |  | 163 |  |  |  | (17 | %)
Respiratory products |  |  | 162 |  |  |  | 183 |  |  |  | (12 | %)
Other* |  |  | 223 |  |  |  | 299 |  |  |  | (25 | %)
Total |  | $ | 3,726 |  |  | $ | 3,749 |  |  |  | (1 | %)

* | Other revenues in the first nine months of 2025 and 2024 include the sale of certain product rights.

Europe Gross Profit

Gross profit from our Europe segment in the first nine months of 2025 was $2,039 million, a decrease of 3% compared to $2,113 million in the first nine months of 2024.

Gross profit margin for our Europe segment in the first nine months of 2025 decreased to 54.7% compared to 56.3% in the first nine months of 2024.

Europe R&D Expenses

R&D expenses relating to our Europe segment in the first nine months of 2025 were $181 million, an increase of 5% compared to $173 million in the first nine months of 2024.

Europe S&M Expenses

S&M expenses relating to our Europe segment in the first nine months of 2025 were $652 million, an increase of 8% compared to $605 million in the first nine months of 2024.

Europe G&A Expenses

G&A expenses relating to our Europe segment in the first nine months of 2025 were $210 million, an increase of 7% compared to $197 million in the first nine months of 2024.

Europe Profit

Profit from our Europe segment in the first nine months of 2025 was $996 million, a decrease of 12% compared to $1,137 million in the first nine months of 2024.

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International Markets Segment

The following table presents revenues, expenses and profit for our International Markets segment for the nine months ended September 30, 2025 and 2024:

|  | Nine months ended September 30, |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions / % of Segment Revenues) |
Revenues |  | $ | 1,634 |  |  |  | 100 | % |  | $ | 1,802 |  |  |  | 100 | %
Cost of sales |  |  | 835 |  |  |  | 51.1 | % |  |  | 914 |  |  |  | 50.7 | %
Gross profit |  |  | 799 |  |  |  | 48.9 | % |  |  | 889 |  |  |  | 49.3 | %
R&D expenses |  |  | 75 |  |  |  | 4.6 | % |  |  | 85 |  |  |  | 4.7 | %
S&M expenses |  |  | 353 |  |  |  | 21.6 | % |  |  | 397 |  |  |  | 22.0 | %
G&A expenses |  |  | 107 |  |  |  | 6.6 | % |  |  | 109 |  |  |  | 6.0 | %
Other loss (income) |  |  | (3 | ) |  |  |  | § |  |  | (1 | ) |  |  |  | §
Segment profit* |  | $ | 266 |  |  |  | 16.3 | % |  | $ | 299 |  |  |  | 16.6 | %

* | Segment profit does not include amortization and certain other items.

§ | Represents an amount less than 0.5%.

International Markets Revenues

Our International Markets segment includes all countries in which we operate other than the United States and the countries included in our Europe segment.

Revenues from our International Markets segment in the first nine months of 2025 were $1,634 million, a decrease of $168 million, or 9%, compared to the first nine months of 2024. In local currency terms, revenues decreased by 7% compared to the first nine months of 2024.

In the first nine months of 2025, revenues were negatively impacted by exchange rate fluctuations of $38 million including hedging effects, compared to the first nine months of 2024. Revenues in the first nine months of 2025 included a negative hedging impact of $20 million compared to a negligible hedging impact in the first nine months of 2024, which are included in “Other” in the table below. See note 8d to our consolidated financial statements.

Revenues by Major Products and Activities

The following table presents revenues for our International Markets segment by major products and activities for the nine months ended September 30, 2025 and 2024:

|  | Nine months ended September 30, |  |  | Percentage Change |
|  | 2025 |  |  | 2024 |  |  | 2025-2024 |
|  | (U.S. $ in millions) |  |  |  |
Generic products (including OTC and biosimilars) |  | $ | 1,298 |  |  | $ | 1,440 |  |  |  | (10 | %)
AJOVY |  |  | 78 |  |  |  | 63 |  |  |  | 24 | %
AUSTEDO |  |  | 34 |  |  |  | 39 |  |  |  | (12 | %)
COPAXONE |  |  | 25 |  |  |  | 38 |  |  |  | (35 | %)
Other* |  |  | 199 |  |  |  | 222 |  |  |  | (11 | %)
Total |  | $ | 1,634 |  |  | $ | 1,802 |  |  |  | (9 | %)

* | Other revenues in the first nine months of 2025 and 2024 include the sale of certain product rights.

AUSTEDO revenues in our International Markets segment in the first nine months of 2025 were $34 million, compared to $39 million in the first nine months of 2024. This decrease was mainly due to timing of shipments.

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International Markets Gross Profit

Gross profit from our International Markets segment in the first nine months of 2025 was $799 million, compared to $889 million in the first nine months of 2024.

Gross profit margin for our International Markets segment in the first nine months of 2025 was 48.9%, compared to 49.3% in the first nine months of 2024. This decrease was mainly due to a negative hedging impact, partially offset by a favorable mix of products.

International Markets R&D Expenses

R&D expenses relating to our International Markets segment in the first nine months of 2025 were $75 million, a decrease of 11% compared to $85 million in the first nine months of 2024.

For a description of our R&D expenses in the first nine months of 2025, see “—Teva Consolidated Results—Research and Development (R&D) Expenses, net” below.

International Markets S&M Expenses

S&M expenses relating to our International Markets segment in the first nine months of 2025 were $353 million, a decrease of 11% compared to $397 million in the first nine months of 2024.

International Markets G&A Expenses

G&A expenses relating to our International Markets segment in the first nine months of 2025 were $107 million, a decrease of 1% compared to $109 million in the first nine months of 2024.

International Markets Profit

Profit from our International Markets segment in the first nine months of 2025 was $266 million, a decrease of 11%, compared to $299 million in the first nine months of 2024.

Other Activities

We have 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 our affiliate Medis. Our other activities are not included in our United States, Europe or International Markets segments described above.

Our revenues from other activities in the first nine months of 2025 were $644 million, a decrease of 9% in U.S. dollars or 10% in local currency terms, compared to the first nine months of 2024.

API sales to third parties in the first nine months of 2025 were $389 million, a decrease of 5% in both U.S. dollars and local currency terms, compared to the first nine months of 2024.

Teva Consolidated Results

Revenues

Revenues in the first nine months of 2025 were $12,547 million, an increase of 2% compared to the first nine months of 2024. In local currency terms, revenues increased by 1%, compared to the first nine months of 2024.

See “—United States Revenues,” “—Europe Revenues,” “—International Markets Revenues” and “—Other Activities” above.

Exchange rate movements during the first nine months of 2025, net of hedging effects, positively impacted revenues by $53 million, compared to the first nine months of 2024. See note 8d to our consolidated financial statements.

Gross Profit

Gross profit in the first nine months of 2025 was $6,282 million, an increase of 6% compared to the first nine months of 2024.

Gross profit margin was 50.1% in the first nine months of 2025, compared to 48.3% in the first nine months of 2024.

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Research and Development (R&D) Expenses, net

R&D expenses, net in the first nine months of 2025 were $746 million, a decrease of 1% compared to the first nine months of 2024.

Our lower R&D expenses, net in the first nine months of 2025 compared to the first nine months of 2024, were mainly due to a decrease in non-recurring milestone payments related to certain biosimilar projects, partially offset by an increase in our immunology projects, as well as in our late-stage innovative pipeline in neuroscience (mainly neuropsychiatry).

R&D expenses, net as a percentage of revenues were 5.9% in the first nine months of 2025, compared to 6.1% in the first nine months of 2024.

Selling and Marketing (S&M) Expenses

S&M expenses in the first nine months of 2025 were $1,933 million, an increase of 2% compared to the first nine months of 2024.

S&M expenses as a percentage of revenues were 15.4% in the first nine months of 2025 and 2024.

General and Administrative (G&A) Expenses

G&A expenses in the first nine months of 2025 were $920 million, an increase of 7% compared to the first nine months of 2024.

G&A expenses as a percentage of revenues were 7.3% in the first nine months of 2025, compared to 7.0% in the first nine months of 2024.

Intangible Asset Impairments

We recorded expenses of $227 million for identifiable intangible asset impairments in the first nine months of 2025, compared to expenses of $169 million in the first nine months of 2024. See note 5 to our consolidated financial statements.

Goodwill Impairment

No goodwill impairment charges were recorded in the first nine months of 2025, compared to a goodwill impairment charge of $1,000 million related to Teva’s API reporting unit recorded in the first nine months of 2024. See note 6 to our consolidated financial statements.

Other Asset Impairments, Restructuring and Other Items

We recorded expenses of $272 million for other asset impairments, restructuring and other items in the first nine months of 2025, compared to expenses of $931 million in the first nine months of 2024. See note 12 to our consolidated financial statements.

Legal Settlements and Loss Contingencies

We recorded expenses of $312 million in legal settlements and loss contingencies in the first nine months of 2025, compared to expenses of $638 million in the first nine months of 2024. See note 9 to our consolidated financial statements.

Other Loss (Income)

Other loss in the first nine months of 2025 was $15 million, compared to other income of $22 million in the first nine months of 2024.

Operating Income (Loss)

Operating income was $1,857 million in the first nine months of 2025, compared to an operating loss of $274 million in the first nine months of 2024.

Operating income as a percentage of revenues was 14.8% in the first nine months of 2025, compared to an operating loss as a percentage of revenues of 2.2% in the first nine months of 2024.

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Financial Expenses, Net

In the first nine months of 2025, financial expenses, net were $714 million, mainly comprised of net interest expenses of $624 million, and a negative exchange rate impact, driven mainly from currencies which we were unable to hedge. In the first nine months of 2024, financial expenses, net were $763 million, mainly comprised of net interest expenses of $691 million and a negative exchange rate impact driven mainly from currencies which we were unable to hedge.

Reconciliation Table to Consolidated Income (Loss) Before Income Taxes

The following table presents a reconciliation of our segment profits to our consolidated operating income (loss) and to consolidated income (loss) before income taxes for the nine months ended September 30, 2025 and 2024:

|  | Nine months ended September 30, |
|  | 2025 |  |  | 2024 |
|  | (U.S. $ in millions) |
United States profit |  | $ | 2,175 |  |  | $ | 1,727 |
Europe profit |  |  | 996 |  |  |  | 1,137 |
International Markets profit |  |  | 266 |  |  |  | 299 |
Total reportable segments profit |  |  | 3,437 |  |  |  | 3,163 |
Profit (loss) of other activities |  |  | (64 | ) |  |  | (1 | )
Total segments profit |  |  | 3,373 |  |  |  | 3,162 |
Amounts not allocated to segments: |  |  |  |  |  |  |  |
Amortization |  |  | 436 |  |  |  | 444 |
Other assets impairments, restructuring and other items |  |  | 272 |  |  |  | 931 |
Goodwill impairment |  |  | — |  |  |  | 1,000 |
Intangible assets impairments |  |  | 227 |  |  |  | 169 |
Legal settlements and loss contingencies |  |  | 309 |  |  |  | 638 |
Other unallocated amounts |  |  | 272 |  |  |  | 254 |
Consolidated operating income (loss) |  |  | 1,857 |  |  |  | (274 | )
Financial expenses, net |  |  | 714 |  |  |  | 763 |
Consolidated income (loss) before income taxes |  | $ | 1,143 |  |  | $ | (1,037 | )

Income Taxes

In the first nine months of 2025, we recognized a tax expense of $210 million, on pre-tax income of $1,143 million. In the first nine months of 2024, we recognized a tax expense of $648 million, on pre-tax loss of $1,037 million. See note 11 to our consolidated financial statements.

Net Income (Loss) Attributable to non-controlling interests

Net income attributable to redeemable and non-redeemable non-controlling interests was $7 million in the first nine months of 2025, compared to a net loss attributable to redeemable and non-redeemable non-controlling interests of $262 million in the first nine months of 2024. The net loss in the first nine months of 2024 was mainly due to higher impairments of tangible assets, largely related to the classification of our business venture in Japan as held for sale. See note 12 to our consolidated financial statements.

Net Income (Loss) Attributable to Teva

Net income attributable to Teva was $930 million in the first nine months of 2025, compared to a net loss of $1,422 million in the first nine months of 2024.

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Diluted Shares Outstanding and Earnings (Loss) per Share

The weighted average diluted shares outstanding used for the fully diluted share calculations for the nine months ended September 30, 2025 and 2024 was 1,160 million shares and 1,130 million shares, respectively.

Diluted earnings per share was $0.81 for the nine months ended September 30, 2025, compared to diluted loss per share of $1.26 for the nine months ended September 30, 2024. See note 13 to our consolidated financial statements.

Impact of Currency Fluctuations on Results of Operations

In the first nine months of 2025, approximately 45% of our revenues were denominated in currencies other than the U.S. dollar. Because our results are reported in U.S. dollars, we are subject to significant foreign currency risks. Accordingly, changes in the exchange rate between the U.S. dollar and local currencies in the markets in which we operate (primarily the euro, British pound, Russian ruble, Swiss franc, Canadian dollar, new Israeli shekel, Polish złoty, Swedish krona, Chilean peso, and Japanese yen) impacted our results.

During the first nine months of 2025, the following main currencies relevant to our operations increased in value against the U.S. dollar (all compared on a nine-month average basis): Russian ruble by 6%, Swedish krona by 5%, new Israeli shekel by 5%, Swiss franc by 5%, Polish złoty by 4%, British pound by 3%, Bulgarian lev by 3% and euro by 3%. The following main currencies relevant to our operations decreased in value against the U.S. dollar (all compared on a nine-month average basis): Argentinian peso by 25%, Turkish lira by 16%, Mexican peso by 9%, Brazilian real by 7%, Ukraine hryvna by 4%, Indian rupee by 4%, Australian dollar by 3% and Canadian dollar by 3%.

As a result, exchange rate movements during the first nine months of 2025, net of hedging effects, positively impacted overall revenues by $53 million and negatively impacted our operating income by $29 million, in comparison to the first nine months of 2024.

In the first nine months of 2025, a negative hedging impact of $51 million was recognized under revenues, and a positive hedging impact of $1 million was recognized under cost of sales. In the first nine months of 2024, a positive hedging impact of $1 million was recognized under revenues and a negative hedging impact of $5 was recognized under cost of sales.

Hedging transactions of future projected revenues and expenses are recognized on the balance sheet at their fair value on a quarterly basis, while the foreign exchange impact on the underlying revenues and expenses may occur in subsequent quarters. See note 8d to our consolidated financial statements.

2025 Aggregated Contractual Obligations

There have not been any material changes in our assessment of material contractual obligations and commitments as set forth in Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2024.

Liquidity and Capital Resources

Total balance sheet assets were $39,856 million as of September 30, 2025, compared to $39,326 million as of December 31, 2024.

Our working capital balance, which includes accounts receivables net of SR&A, inventories, prepaid expenses and other current assets, accounts payables, employee-related obligations, accrued expenses and other current liabilities, was negative $2,419 million as of September 30, 2025, compared to negative $2,837 million as of December 31, 2024. This increase was mainly due to higher inventory levels primarily due to exchange rate fluctuations, and an increase in accounts receivables, net of SR&A, as well as an increase in prepaid expenses and a decrease in employee related obligations mainly due to performance incentive payments to employees for 2024, partially offset by an increase in accounts payables and accrued expenses primarily due to exchange rate fluctuations.

Employee-related obligations, as of September 30, 2025 were $561 million, compared to $624 million as of December 31, 2024. The decrease in the first nine months of 2025 was mainly due to performance incentive payments to employees for 2024, partially offset by an accrual for performance incentive payments to employees for 2025.

Cash investment in property, plant and equipment and intangible assets in the third quarter of 2025 was $136 million, compared to $148 million in the third quarter of 2024. Depreciation in the third quarter of 2025 was $105 million, compared to $113 million in the third quarter of 2024.

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Cash and cash equivalents as of September 30, 2025, were $2,203 million, compared to $3,300 million as of December 31, 2024. See also the statement of cash flow to our consolidated financial statements.

In the first quarter of 2025, we paid a dividend of $340 million to redeemable non-controlling interests in our business venture in Japan.

Our cash on hand that is not used for ongoing operations is generally invested in bank deposits as well as liquid securities that bear fixed and floating rates.

Teva’s principal sources of short-term liquidity are its cash on hand, existing cash investments, liquid securities and available credit facilities, primarily our $1.8 billion unsecured syndicated sustainability-linked revolving credit facility, entered into in April 2022, as amended in February 2023 and in May 2024 (“RCF”). See note 7 to our consolidated financial statements.

Debt Balance and Movements

As of September 30, 2025, our debt was $16,790 million, compared to $17,783 million as of December 31, 2024. This decrease was mainly due to repayment at maturity of $1,812 million of our senior notes (as detailed below), partially offset by an increase of $791 million due to exchange rate fluctuations. Additionally, during the second quarter of 2025, we repurchased $2,290 million aggregate principal amount of notes upon consummation of a cash tender offer, and issued $2,298 million of senior notes, net of discount and issuance costs. For further information, see note 7 to our consolidated financial statements.

In January 2025, we repaid $426 million of our 6% senior notes at maturity.

In January 2025, we repaid $427 million of our 7.13% senior notes at maturity.

In March 2025, we repaid $515 million of our 4.50% senior notes at maturity.

In July 2025, we repaid $444 million of our 1% senior notes at maturity.

As of September 30, 2025, our debt was effectively denominated in the following currencies: 57% in U.S. dollars and 43% in euros.

The portion of total debt classified as short-term as of September 30, 2025 was negligible compared to 10% as of December 31, 2024.

Our financial leverage, which is the ratio between our debt and the sum of our debt and equity, was 70% as of September 30, 2025, compared to 77% as of December 31, 2024. Our average debt maturity was approximately 5.85 years as of September 30, 2025, compared to 5.5 years as of December 31, 2024.

Total Equity

Total equity was $7,254 million as of September 30, 2025, compared to $5,380 as of December 31, 2024. This increase was mainly due to a net income attributable to Teva of $930 million and a positive impact from exchange rate fluctuations of $645 million.

Exchange rate fluctuations affected our balance sheet, as approximately 78% of our net assets as of September 30, 2025 (including both monetary and non-monetary assets) were in currencies other than the U.S. dollar. When compared to December 31, 2024, changes in currency rates as of September 30, 2025 had a positive impact of $645 million on our equity. The following main currencies increased in value against the U.S. dollar: Russian ruble by 25%, Swiss franc by 12%, Polish złoty by 11%, Bulgarian lev by 11%, euro by 11%, Mexican peso by 11%, British pound by 6% and Japanese yen by 5%. All comparisons are on a year-to-date basis.

Cash Flow

We continually seek to improve the efficiency of our working capital management. Periodically, as part of our cash and commercial relationship management activities, we make decisions in our commercial, supply chain, and other activities which drive an acceleration of receivable payments from customers, or deceleration of payments to vendors, including timing of payments related to legal settlements, tax authorities and other matters. This has the effect of increasing or decreasing cash from operations, as well as working capital balance items during any given period. Increased cash from operations has the effect of reducing our leverage ratio, which is measured net of cash and cash equivalents, as of the end of such period. In connection with strategic continual improvement, we obtained more favorable payment terms from many of our vendors which are expected to continue in future periods. In addition, in periods in which receivable payments from customers are delayed, we have and expect we may in the future extend the time to pay certain vendors, so as to balance our liquidity position. Such decisions have had and may in the future have a material impact on our annual operating cash flow measurement, as well as on our quarterly results.

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Cash flow generated from operating activities during the third quarter of 2025 was $369 million, compared to $693 million in the third quarter of 2024. The lower cash flow generated from operating activities in the third quarter of 2025 was mainly due to timing of sales and collections, as well as higher legal settlement payments, partially offset by lower tax payments and higher profit.

During the third quarter of 2025, we generated free cash flow of $515 million, which we define as comprising $369 million in cash flow generated from operating activities, $274 million in beneficial interest collected in exchange for securitized accounts receivables (under our EU securitization program) and $8 million of proceeds from divestitures of businesses and other assets, partially offset by $136 million in cash used for capital investment. During the third quarter of 2024, we generated free cash flow of $922 million, which we define as comprising $693 million in cash flow generated from operating activities, $339 million in beneficial interest collected in exchange for securitized accounts receivables (under our EU securitization program) and $38 million in divestitures of businesses and other assets, partially offset by $148 million in cash used for capital investment. The decrease in the third quarter of 2025 mainly resulted from lower cash flow generated from operating activities, as well as a decrease in proceeds from divestitures of businesses and other assets.

Dividends

We have not paid dividends on our ordinary shares or American Depositary Shares (ADSs) since December 2017.

Commitments

In addition to financing obligations under short-term debt and long-term senior notes and loans, debentures and convertible debentures, our major contractual obligations and commercial commitments include leases, royalty payments, contingent payments pursuant to acquisition agreements, collaboration agreements, development funding agreements and participation in joint ventures associated with R&D activities. For further information on our agreements with mAbxience, Launch Therapeutics and Abingworth, Biolojic Design, Royalty Pharma, Sanofi, Modag, Alvotech, Takeda and MedinCell, see note 2 to our consolidated financial statements.

We are committed to paying royalties, subject to the terms of applicable agreements, to the owners of know-how, partners in alliances and certain other arrangements, and to parties that financed R&D at a wide range of rates as a percentage of sales of certain products, as defined in the agreements. In some cases, the royalty period is not defined under the applicable agreement; in other cases, royalties will be paid over various periods not exceeding 20 years.

In connection with certain development, supply and marketing, and research and collaboration or services agreements, we are required to indemnify, in unspecified amounts, the parties to such agreements against third-party claims relating to (i) infringement or violation of intellectual property or other rights of such third party; or (ii) damages to users of the related products. Except as described in our financial statements, we are not aware of any material pending action that may result in the counterparties to these agreements claiming such indemnification.

Non-GAAP Net Income and Non-GAAP EPS Data

We present non-GAAP net income and non-GAAP earnings per share (“EPS”) as management believes that such data provide useful information to investors because they are used by management and our Board of Directors, in conjunction with other performance metrics, to evaluate our operational performance, to prepare and evaluate our work plans and annual budgets and ultimately to evaluate the performance of management, including annual compensation. While other qualitative factors and judgment also affect annual compensation, the principal quantitative element in the determination of such compensation are performance targets tied to the work plan, which are based on these non-GAAP measures.

Non-GAAP financial measures have no standardized meaning and accordingly have limitations in their usefulness to investors. Investors are cautioned that, unlike financial measures prepared in accordance with U.S. GAAP, non-GAAP measures may not be comparable with the calculation of similar measures for other companies. These non-GAAP financial measures are presented solely to permit investors to more fully understand how management assesses our performance. The limitations of using non-GAAP financial measures as performance measures are that they provide a view of our results of operations without including all events during a period and may not provide a comparable view of our performance to other companies in the pharmaceutical industry. Investors should consider non-GAAP net income and non-GAAP EPS in addition to, and not as replacements for, or superior to, measures of financial performance prepared in accordance with GAAP.

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In preparing our non-GAAP net income and non-GAAP EPS data, we exclude items that either have a non-recurring impact on our financial performance or which, in the judgment of our management, are items that, either as a result of their nature or size, could, were they not excluded, potentially cause investors to extrapolate future performance from an improper base that is not reflective of our underlying business performance. Certain of these items are also excluded because of the difficulty in predicting their timing and scope. The items excluded from our non-GAAP net income and non-GAAP EPS include:

| • |  | amortization of purchased intangible assets;

| • |  | certain legal settlements and material litigation fees and/or loss contingencies, due to the difficulty in predicting their timing and scope;

| • |  | impairments of long-lived assets, including intangibles, property, plant and equipment and goodwill;

| • |  | restructuring expenses, including severance, retention costs, contract cancellation costs and certain accelerated depreciation expenses primarily related to the rationalization of our plants or to certain other strategic activities, such as the realignment of R&D focus or other similar activities;

| • |  | acquisition- or divestment- related items, including loss (gain) on sale of businesses, changes in contingent consideration, integration costs, banker and other professional fees and inventory step-up;

| • |  | expenses related to our equity compensation;

| • |  | significant one-time financing costs, amortization of issuance costs and terminated derivative instruments, and marketable securities investment valuation gains/losses;

| • |  | unusual tax items;

| • |  | other awards or settlement amounts, either paid or received;

| • |  | other exceptional items that we believe are sufficiently large that their exclusion is important to facilitate an understanding of trends in our financial results, such as impacts due to significant costs for remediation of plants, or other unusual events; and

| • |  | corresponding tax effects of the foregoing items.

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The following tables present our non-GAAP net income and non-GAAP EPS for the three and nine months ended September 30, 2025 and 2024, as well as reconciliations of each measure to their nearest GAAP equivalents:

|  |  |  |  | Three months ended September 30, |  |  |  |  |  | Nine months ended September 30, |
($ in millions except per share amounts) |  |  |  |  | 2025 |  |  | 2024 |  |  |  |  |  | 2025 |  |  | 2024 |
Net income (Loss) attributable to Teva |  | ($ | ) |  |  |  | 433 |  |  |  | (437 | ) |  | ($ | ) |  |  |  | 930 |  |  |  | (1,422 | )
Increase (decrease) for excluded items: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Amortization of purchased intangible assets |  |  |  |  |  |  | 144 |  |  |  | 146 |  |  |  |  |  |  |  | 436 |  |  |  | 444 |
Legal settlements and loss contingencies(1) |  |  |  |  |  |  | 60 |  |  |  | 450 |  |  |  |  |  |  |  | 309 |  |  |  | 638 |
Goodwill impairment(2) |  |  |  |  |  |  | — |  |  |  | 600 |  |  |  |  |  |  |  | — |  |  |  | 1,000 |
Impairment of long-lived assets(3) |  |  |  |  |  |  | 79 |  |  |  | (51 | ) |  |  |  |  |  |  | 255 |  |  |  | 758 |
Restructuring costs(4) |  |  |  |  |  |  | 29 |  |  |  | 21 |  |  |  |  |  |  |  | 196 |  |  |  | 52 |
Equity compensation |  |  |  |  |  |  | 34 |  |  |  | 29 |  |  |  |  |  |  |  | 106 |  |  |  | 89 |
Contingent consideration(5) |  |  |  |  |  |  | 16 |  |  |  | 34 |  |  |  |  |  |  |  | 46 |  |  |  | 305 |
Loss (Gain) on sale of business |  |  |  |  |  |  | — |  |  |  | (20 | ) |  |  |  |  |  |  | — |  |  |  | (21 | )
Financial expenses |  |  |  |  |  |  | 7 |  |  |  | 11 |  |  |  |  |  |  |  | 58 |  |  |  | 35 |
Redeemable and non-redeemable non-controlling interests(6) |  |  |  |  |  |  | — |  |  |  | 41 |  |  |  |  |  |  |  | 2 |  |  |  | (276 | )
Other non-GAAP items(7) |  |  |  |  |  |  | 51 |  |  |  | 57 |  |  |  |  |  |  |  | 167 |  |  |  | 170 |
Corresponding tax effects and unusual tax items(8) |  |  |  |  |  |  | 58 |  |  |  | (83 | ) |  |  |  |  |  |  | (225 | ) |  |  | 270 |
Non-GAAP net income attributable to Teva |  | ($ | ) |  |  |  | 910 |  |  |  | 798 |  |  | ($ | ) |  |  |  | 2,281 |  |  |  | 2,043 |
Non-GAAP tax rate(9) |  |  |  |  |  |  | 14.7 | % |  |  | 16.0 | % |  |  |  |  |  |  | 16.0 | % |  |  | 15.5 | %
GAAP diluted earnings (loss) per share attributable to Teva |  | ($ | ) |  |  |  | 0.37 |  |  |  | (0.39 | ) |  | ($ | ) |  |  |  | 0.80 |  |  |  | (1.26 | )
EPS difference(10) |  |  |  |  |  |  | 0.41 |  |  |  | 1.08 |  |  |  |  |  |  |  | 1.16 |  |  |  | 3.04 |
Non-GAAP diluted EPS attributable to Teva(10) |  | ($ | ) |  |  |  | 0.78 |  |  |  | 0.69 |  |  | ($ | ) |  |  |  | 1.97 |  |  |  | 1.78 |
Non-GAAP average number of shares (in millions)(10) |  |  |  |  |  |  | 1,164 |  |  |  | 1,155 |  |  |  |  |  |  |  | 1,160 |  |  |  | 1,148 |

(1) | For the third quarter of 2025, adjustments of legal settlements and loss contingencies mainly consisted of an update to the estimated settlement provision for the opioid cases (mainly the effect of the passage of time on the net present value of the discounted payments) of $42 million. Adjustments for legal settlements and loss contingencies in the third quarter of 2024 mainly related to a provision of $350 million recorded in connection with a decision by the European Commission in its antitrust investigation into COPAXONE, and to an update to the estimated settlement provision of $121 million for the opioid cases (mainly related to the settlement agreement with the city of Baltimore and the effect of the passage of time on the net present value of the discounted payments). For the nine months ended September 30, 2025, adjustments of legal settlements and loss contingencies mainly consisted of (a) an update to the estimated settlement provision for the opioid cases (mainly the effect of the passage of time on the net present value of the discounted payments) of $139 million, and (b) an update to the estimated provision recorded for the claims brought by attorneys general representing states and territories throughout the United States in the generic drug antitrust litigation of $55 million. Adjustments for legal settlements and loss contingencies in the nine months ended September 30, 2024 were mainly related to a provision of $350 million recorded in connection with the decision by the European Commission in its antitrust investigation into COPAXONE, and to an update to the estimated settlement provision for the opioid cases (mainly the effect of the passage of time on the net present value of the discounted payments and the settlement agreement with the city of Baltimore) of $239 million.

(2) | Goodwill impairment charges of $600 million and $1,000 million related to Teva’s API reporting unit were recorded in the three and nine months ended September 30, 2024, respectively.

(3) | For the nine months ended September 30, 2025, the adjustment for impairment of long-lived assets was mainly related to products in the U.S. and Europe. For the nine months ended September 30, 2025, adjustments for impairment of long-lived assets and redeemable and non-redeemable non-controlling interests primarily consisted of $561 million and $275 million, respectively, related to the classification of the business venture in Japan as held for sale.

(4) | In the nine months ended September 30, 2025, Teva recorded $196 million of restructuring expenses primarily related to optimization activities in connection with Teva’s Transformation programs related to Teva’s global organization and operations, mainly through headcount reduction.

(5) | Adjustments for the nine months ended September 30, 2024 primarily related to a change in the estimated future royalty payments to Allergan in connection with lenalidomide capsules (the generic version of Revlimid®) of $266 million.

(6) | For the nine months ended September 30, 2024, the redeemable and non-redeemable non-controlling interests portion of long-lived assets impairment related to the classification of our business venture in Japan as held for sale.

(7) | Other non-GAAP adjustments include other exceptional items for which their exclusion is important to facilitate an understanding of trends in our financial results, primarily related to the rationalization of our plants, accelerated depreciation, certain inventory write-offs, material litigation fees and other unusual events.

(8) | Adjustments for corresponding tax effects and unusual tax items exclusively consisted of the tax impact directly attributable to the pre-tax items that are excluded from non-GAAP net income included in the other adjustments to this table.

(9) | Non-GAAP tax rate is tax expenses (benefit) excluding the impact of non-GAAP tax adjustments presented above as a percentage of income (loss) before income taxes excluding the impact of non-GAAP adjustments presented above.

(10) | EPS difference and diluted non-GAAP EPS are calculated by dividing our non-GAAP net income attributable to Teva by our non-GAAP diluted weighted average number of shares.

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Off-Balance Sheet Arrangements

We do not have any material off-balance sheet arrangements, except for: (i) surety underwritten guarantees Teva has provided the European Commission in an amount of euro 462.2 million, together with specified post-decision interest, which remain in force for three years, and which includes substantially similar covenants as our RCF, as disclosed in note 10 to our consolidated financial statements, and (ii) securitization transactions, which are disclosed in note 10f to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2024.

Critical Accounting Policies

For a summary of our significant accounting policies, see note 1 to our consolidated financial statements and “Critical Accounting Policies” included in our Annual Report on Form 10-K for the year ended December 31, 2024.

Recently Issued Accounting Pronouncements

See note 1 to our consolidated financial statements.

ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There has not been any material change in our assessment of market risk as set forth in Part II, Item 7A to our Annual Report on Form 10-K for the year ended December 31, 2024.

ITEM 4. | CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

Teva maintains “disclosure controls and procedures” (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) that are designed to provide reasonable assurance that information required to be disclosed in Teva’s reports filed or submitted under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to Teva’s management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objective.

After evaluating the effectiveness of our disclosure controls and procedures as of September 30, 2025, our Chief Executive Officer and Chief Financial Officer concluded that, as of such date, Teva’s disclosure controls and procedures were effective at the reasonable assurance level.

Changes in Internal Control over Financial Reporting

During the three months ended September 30, 2025, there was no change in Teva’s internal control over financial reporting that materially affected or is reasonably likely to materially affect Teva’s internal control over financial reporting.

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PART II — OTHER INFORMATION

ITEM 1. | LEGAL PROCEEDINGS

We are subject to various litigation and other legal proceedings. For a discussion on our Commitments and Contingencies see note 10 to our consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form
10-Q.
For a discussion of additional legal proceedings, please refer to our Form
10-Q
for the period ended March 31, 2025, filed with the SEC on May 7, 2025.

ITEM 1A. | RISK FACTORS

There are no material changes to the risk factors previously disclosed in our Annual Report on Form
10-K
for the year ended December 31, 2024.

ITEM 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Unregistered Sales of Equity Securities
There were no sales of unregistered equity securities during the three months ended September 30, 2025.
Repurchase of Shares
We did not repurchase any of our shares during the three months ended September 30, 2025. Under applicable Israeli corporate law, a share repurchase is considered a distribution and is subject to the applicable statutory tests and limitations, related to a company’s profits and solvency capabilities. Pursuant to a recent amendment in applicable corporate law regulations, companies whose shares are listed abroad (including dual-listed companies such as Teva), may benefit from certain relief with respect to the procedures to be taken in connection with share repurchases. Decisions regarding any future share repurchases will depend on certain factors, such as market conditions, share price and other opportunities to invest capital for growth in alignment with the Company’s Pivot to Growth strategy, and are subject to the approval by Teva’s Board of Directors.

ITEM 3. | DEFAULTS UPON SENIOR SECURITIES

Not applicable.

ITEM 4. | MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. | OTHER INFORMATION

Director and Officer Rule
10b5-1
Trading Arrangements
During the three months ended September 30, 2025, the following officer adopted a Rule
10b5-1
trading arrangement (as such term is defined in Item 408 of Regulation
S-K).
The trading plan is intended to satisfy the affirmative defense of Rule
10b5-1(c)
under the Exchange Act.

Name and Title |  | Date |  | Expiration Date |  | Maximum Shares Subject to Plan (1) |
Christine Fox, Executive Vice President, U.S. Commercial |  | August 11, 2025 |  | March 6, 2026 |  |  | 101,772 |

(1) | The plan includes shares to be sold solely to cover tax withholding obligations.

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ITEM 6. | EXHIBITS

31.1 |  | Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 *
31.2 |  | Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 *
32 |  | Certification of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 *
101.INS |  | Inline XBRL Taxonomy Instance Document
101.SCH |  | Inline XBRL Taxonomy Extension Schema Document
104 |  | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

* | Filed herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

|  |  |  | TEVA PHARMACEUTICAL INDUSTRIES LIMITED
Date: November 5, 2025 |  |  |  | By: |  | /s/ Eli Kalif
|  |  |  | Name: |  | Eli Kalif
|  |  |  | Title: |  | Executive Vice President, Chief Financial Officer (Duly Authorized Officer)

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