Teva Pharmaceutical Industries Morgan Stanley 24th Annual Global Healthcare Conference

Okay. I'll try and be brief because obviously I could spend the whole time talking about that. Where we are in the story, to answer that first part of the question. Pivot to Growth we started in 2023. It was a three-part plan, return to growth, accelerate growth, and maintain growth. We're in the second chapter or phase, you could say. I would say there's a lot more to come, and we'll be explaining why there's a lot more to come. But I think over this period of time, what we've shown is we've started with the ambition of transforming Teva from a pure-play generics company into a world-leading biopharma company. And very quickly, over 3 and a half years, that has become something which seemed slightly unbelievable in 2023 to something that is very believable now.

Just because if you look at the products we have, the pipeline we have, the momentum we have, then we clearly are executing well on that ambition. The Pivot to Growth strategy, and I see many familiar faces in the audience here, so you're used to me being quite boring about this, but I think the repetition is why we've done well. Pivot to Growth is based on four pillars. Deliver on our growth engine, step up innovation, create a generics powerhouse, and focus the business, focus capital. We've been executing this seamlessly for the last 3 and a half years. It will be executed seamlessly going forward for the next, I'd say, 7 at least. Because we have a clear idea how we can create shareholder value, how we can continue to grow the top line and the bottom line.

A lot of that comes from the fact that we've taken some innovative products, AJOVY, AUSTEDO, and UZEDY, and accelerated them and made people start to model them in a way that they wouldn't have modeled them before in their calculations. And that's because we are really good at commercializing products. And with step-up innovation, which I'm sure Eric will get a lot of questions on, and he should, rightly so, we've taken a company that was questioned whether you could develop innovative products and move them into the clinic and then move them through the clinic, and I think we've done that, and I think in most metrics, we are upper quartile.

So that means if the first pillar is we can sell stuff, and the second pillar, we're developing stuff very quickly, and I think some really unique assets, and we'll talk about the readouts we have this year. I think clearly those two show a lot of potential to create a lot of growth on the top and the bottom line going forward. On the third pillar, we've gone from a declining generics business to one that's now stabilized and over the last few years, accelerated or grown, and we're going to add more and more biosimilars to that. Finally, because I'm only taking 2 minutes, we've returned to capital allocation from a deal-making perspective. We've obviously done that with our first deal with Amylyx, which I think we're seeing as being strategically aligned to what we said we're going to do.

Be in the CNS space. It's very synergistic. I think we're going to be able to turn that asset into an asset which is going to fulfill those financial requirements that I've laid out. Because my CFO is looking at me now, I must mention the fact that we've done two other things, which is actually today is a big day for us. So we've taken ADS shares and converted those to ordinary shares. So those will allow more investors to have access to the Teva opportunity, which I think is still significant going forward. The final thing, which I think relates to something which we never talk about anymore, which we did talk about a little bit at the start of my tenure, which is debt. There's a good thing about debt.

Our debt has gone down considerably, and because we've become investment-grade now across all three of the rate agencies, over a year ahead of when we said we were going to do that, we did a refinancing last week where we were hugely oversubscribed. I think we got that financing done in a very short period of time at a very good price, and that reflects, once again, all the other things I've said, because obviously that's looked at very closely. So congratulations to the team who did that last week. There's a lot within that, and I'm sure we can go deeper, but maybe the fact there's a lot within it is why I am so convinced that the value creation story that we've started has a long way to run with Teva.

So obviously, it is an interesting thing. It is a very dynamic world we live in, geopolitically, in most areas, actually. I think what Teva has shown is that we have a real capability to maneuver within that world. But to your specific point on tariffs, yeah, I think we have the largest generic manufacturing footprint in the U.S. I think that gives us an advantage on that one level. But I also think we have shown with our work with the administration, both through things we have done with HHS and IRA, as well as the potential deal we are going to close with the administration that you saw at the White House a couple of weeks ago, that I think we have the ability to work well with this administration because we are a unique company.

We bring, I think it is close to $40 billion of savings to the U.S. every year, as well as the fact that we bring innovative. So I think our seat to the table gives us a significant share of voice. But is it a competitive advantage? As we work together, you will find I am more measured. I do not lean into things too much. Let us see how it plays out. I think we are in a strong position right now. But I would also say that the changing dynamics of our portfolio, particularly around biosimilars, probably lends itself to also helping us in that more challenging environment.

I think everybody is trying to sort of get me, and I can understand why, to sort of give guidance for 2027 on AUSTEDO. But I did give guidance in 2023 on AUSTEDO, so I gave it really ahead of schedule at $2.5 billion. Look, the way I think about it, the first way I want people to always think about how I answer this question, I answer this question with $3 billion. This product will do over $3 billion, and that is the most important thing to be thinking about. What it does in 2027 is just a journey on that road to $3 billion. Okay? Greater than $3 billion. What will it be? Well, obviously we have seen good momentum this year with AUSTEDO. The team at the U.S. are doing a great job. Where we will be next year with AUSTEDO, we will give guidance on that.

I think I'd remind everybody that the untreated population tragically is still really, really high when it comes to tardive dyskinesia. Our performance, our capability to capture patients, to get them onto therapy, to have them on the optimal dose, as well as to make sure they can adhere and stay compliant, is improving all the time. That is why I feel so confident about getting over $3 billion. When it comes to 2027, we'll talk closer when I have more data from Q3 and Q4 and talk to you about where I think the volume's going to come from, where I think we're going to end up from a revenue point of view. But I would remind everybody that it looks like now where we are with our guidance, the midpoint, we're going to hit our $2.5 billion a year early.

We hit our $2.5 billion AUSTEDO a year early. We hit our investment grade across all three rating agencies a year early. There's a lot of things that we do that people didn't think we could do, and we do them earlier. When it comes to the phase III studies on many of our assets, we put them through the clinic, or Eric has, a lot quicker. That may be how I'd answer AUSTEDO. A lot more opportunity. Think of it as $3 billion plus, and then work back from there.