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HomeBusiness NewsTeva Pharmaceutical Industries (NYSE:TEVA) Intends To Reach An Opioid Settlement In The...

Teva Pharmaceutical Industries (NYSE:TEVA) Intends To Reach An Opioid Settlement In The United States  

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Teva Pharmaceutical Industries (NYSE:TEVA) intends to reach an opioid settlement in the United States by the end of the year and begin paying in 2023, according to its CEO, who also questioned the company’s extremely low share price.

Teva, based in Israel, offered a $4.35 billion countrywide settlement in July to resolve its opioid litigation, largely in cash but also with drugs worth $300 million to $400 million over 13 years.

More than 3,000 lawsuits were filed in the United States against opioid makers, distributors, and pharmacies, accusing them of downplaying the hazards of addiction and failing to prevent tablets from being diverted for unlawful use.

CEO Kare Schultz stated that the company was working on legal language that would be completed by the end of September. It must then be approved by states and state subdivisions.

“When people opt in, after that is all done… then it goes into effect, which means the first payments will be sent next year and will continue for 13 years,” Schultz said during a news conference. “So, by the end of the year, you should have this confirmation that everything comes together and we will begin paying next year.”

Teva has denied wrongdoing, claiming that it sold lawful pain medicine that was approved by the FDA. According to federal figures, the opioid crisis in the United States has resulted in more than 500,000 overdose fatalities over the last two decades, including more than 80,000 in 2021 alone.

Teva, according to Schultz, will cut expenses even more by shutting several of its facilities. It has decreased the number of production sites from 80 to 53 since 2017, and it aims to eliminate another 10 in the coming years. Teva’s New York-listed shares are up 10% in 2022 to $8.81, but remain significantly behind their 2015 high of $72.

Teva, according to Schultz, has a price-earnings ratio of roughly 3.5, when a typical rate should be 10. “Teva has one of the lowest P/E ratios of any stock I’m aware of, and the business is actually highly solid, with long-term growth and cash generation – so it’s very attractive for long-term investors,” Schultz said.

“Right now, we’re worth one-third of what we’d be worth if we didn’t have these risk factors.”

He indicated that the poor share price was mostly due to significant debt, which has been reduced to $20 billion from $34 billion, and opioid lawsuits.

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