Better than expected Q1 for Teva ahead of $40bn Actavis buy
Teva has posted better than expected first quarter profits, in the build-up to its acquisition next month of Allergan's generics business, formerly known as Actavis.
Already the world's largest generics firm, Teva is buying the Actavis generics business from Allergan in a deal worth $40.5 billion, that was originally slated to close in April.
But the acquisition has been delayed for two months by an anti-trust review in the US, which will require Teva to sell off certain product lines.
However the better than expected results will help maintain Teva's share price as the deal approaches. As the deal is in a combination of $33.75 billion in cash and $6.75 billion in shares, the number of shares Teva must give away to Allergan depends on the Israel-based company's average share price around the time of closure.
So the figures published this week will be a boost to the company, which has seen its share value fall to around $52.81 on the NASDAQ exchange, from a 52-week high of more than $72.
Revenues in Q1 were $4.8 billion, down 3% compared with Q1 2015, ahead of forecasts. Adjusted earnings of $1.36 per share beat analysts' estimates by 19 cents. Teva also closed a $2.3 billion acquisition of Mexican drugmaker Rimsa in Q1.
Sales of its Copaxone (glatiramer) branded multiple sclerosis drug have also held up, as although an older daily 20mg/ml version has gone off patent in the US, Teva has switched 81% of US Copaxone patients to a patent-protected thrice weekly 40mg/ml version.
This Q1, sales of the drug were up 9% compared with the same period last year, at just over $1 billion.
Chief executive Erez Vigodman said: "We are excited to be in the final stages of completing the acquisition of Actavis Generics, which will enable us to further realise the enormous potential in the growing global generics universe and deliver the benefits of this transaction to our stockholders, customers, patients and healthcare systems around the world."