Teva Pharmaceutical Industries Ltd (NYSE:TEVA) is considering cutting almost 10,000 jobs as new CEO Kare Schultz looks to pare costs. As per a Bloomberg report, the firm intends to lower expenses by as much as $1.5 billion to $2 billion in the next 2 years, with almost 50% cuts linked to R&D spending. The drugmaker doesn’t plan to progress with an equity offering in the near term
Teva has yet to reach a final decision and also the targets may be changed, with a range of 5,000 to 10,000 jobs being noted. That would comprise for more than 15% of the total staff. The measures may help Schultz, who last month took the controls at the company, in stopping a rout that has witnessed the stock declined to its lowest level in seventeen years. The CEO changed the management team and has said he intends to showcase a detailed plan in mid-December for company’s recovery.
However, the firm’s market to languish around $15.2 billion, or less than 50% of its debt burden, as peers squeeze the profitability of its leading product and its generic drugs segment. Looking ways to retire debt of almost $35 billion, Teva Pharmaceutical has been offering assets, firing staff and closing factories in recent quarters after its bet in the generic market. Still, the firm was forced on November 2, to reduce its profit guidance for 2017, reduce its dividend, lower the goal for retiring debt this year and indicate it may sell fresh shares.
Teva Pharmaceutical has since closed initiatives to divest its European pain and oncology segments, as Bloomberg reported on November 27. The firm obtained lower-than-anticipated bids for the operations, which could have recorded $1 billion. This in led prompted the company to hold on to these assets.
The firm engaged nearly 57,000 people internationally at the close of last year, including 24,000 in Europe, more than 10,000 people in the United States and over 6,800 in Israel.