- Teva Pharmaceutical Industries Ltd. has sold off the remaining assets in its specialty women's health business for nearly $1.4 billion, money the Israeli drugmaker intends to put toward paying down its heavy debt load.
- The assets are going to separate buyers. Private equity firm CVC Capital Partners is acquiring a variety of products sold outside the U.S., including fertility medication Ovaleap and birth control pill Seasonique, for $703 million. Meanwhile, over-the-counter specialist Foundation Consumer Healthcare LLC is snagging emergency contraceptive brands for $675 million.
- In 2016, annual net sales totaled $258 million and $140 million, respectively, for the medicines headed to CVC and Foundation, according to a Monday statement from Teva.
Teva had racked up about $35 billion in debt by the end of June. Looking to strengthen its balance sheet, the company decided to identify and offload non-core assets — starting with its women's health business.
Earlier this week, the drugmaker sold its copper intrauterine device (IUD) Paragard to Cooper Surgical Inc. for $1.1 billion. The news came right after an announcement that Kåre Schultz had left the top stop at Lundbeck A/S to serve as Teva's new CEO.
The deal with Cooper, as well as the freshly inked agreements with CVC and Foundation, helped Teva to surpass its goal of generating $2 billion from asset sales by year's end. But there's still work to be done.
"With the divestiture of Teva’s global women’s health products and the planned divestiture of the Oncology and Pain business in Europe, Teva is reinforcing its strategic focus on CNS and Respiratory as its core global therapeutic areas of focus within Global Specialty Medicines," the company wrote in the Sept. 18 statement. "In these areas Teva maintains a strong pipeline and portfolio globally, and will continue to invest in creating long term value."
Teva may also sell Medis, a generics business that came under the drugmaker's ownership following its $40.5 billion acquisition of Allergan plc's Actavis Generics. A company representative confirmed it was mulling putting the asset on the block, according to an August report from Bloomberg.
Such a move would likely gain favor with investors, many of whom were opposed to the high-priced Actavis deal. In fact, much of Teva's current debt problems stem from that purchase.
Making the matter worse is the U.S. generics market, which has grown increasingly crowded as of late. Lower prices as a result of competition have contributed to weaker returns for several big-name copycat drugmakers. Teva, for instance, saw its stock tank 18% in early August after it reported worse-than-expected second quarter revenues.
Teva expects the deals with CVC and Foundation to close before the end of 2017. The company's stock fell about 6% to $16.99 per share on Monday.