Teva Pharmaceutical Industries has targeted $2bn in cost savings within the next five years, its CEO has told Wall Street investors.

Jeremy Levin, who took over as chief executive in May, revealed plans to save the money over the next five years in order for it move away from simply manufacturing generic products.

Levin told investors that the company will cut up to $2bn from its expenditure by reducing research and development programmes, reviewing the way it purchases IT and raw materials and selling certain facilities.

“Teva will look like a very different company going forward,” Levin told investors.

Israeli-based Teva is a global leader in the generic market but has plans to develop into a major pharmaceutical company. Levin replaced Shlomo Yanai with the intention of boosting Teva’s revenue streams through a new approach of mergers and acquisitions.

Yet despite recently purchasing Cephalon, along with its branded drugs Provigil and Nuvigil, the company has failed to hit Levin’s revenue target of $20.8bn. Teva now expects revenue for 2012 to be between $19.5 billion and $20.5 billion.

Jeremy Levin, the new Teva CEO, has announced “an augmentation of the US generics team” to restore the company’s position in that market sector.

Allan Oberman will shift from leading Teva’s EMIA division to leading its US generics division – replacing Tim Crew, who will move to another role.

Teva has long dominated the US generics market, but its annual generic drugs revenue in the US fell by 32% to $4bn in 2011.

Based in Israel, Teva divides its global business into four units: Europe, the Americas, EMIA (Eastern Europe, the Middle East, Israel and Africa).

Speaking at a press conference, Levin (pictured) said: “We have instituted an augmentation of the US generics team, and that was an important step for us to bring in the greater depth of management and greater capability there, to assist in what I believe we can do here, which is to rebuild that market share.”

Teva’s new distribution centre in Northeast Philadelphia, due to be completed in mid-2013, will further strengthen its US presence.

Levin, who joined Teva in February, replaced Shlomo Yanai as CEO on May 10.

Net revenue was up by a quarter at Teva Pharmaceutical Industries in the first three months of 2012 to more than $5.1 billion.

An increase in sales in the US and Rest of the World saw GAAP income increase to $859 million and non-GAAP net income climb to $1.30bn.

Shlomo Yanai, Teva’s President and CEO, said the company is “off to a good start”.

Teva saw net revenue for generic products increase by 12%, when compared to the same period last year, to $2.6bn and net revenue for its branded products hike by 54% to $2.1bn – mainly due to sales of Cephalon.

In the US, net revenues generated $2.8bn, an increase of 46% compared to Q1 2011, and accounted for 54% of overall sales.

Sales in the Rest of the World were up 21% to $1bn as revenues grew in the region by 23%. But net revenue dipped by 2% in Europe compared to the same quarter of last year due to austerity measures and price reductions.

“We enjoyed a quarter of strong growth for our branded products, in our US generics business, and in the developing markets Teva operates in,” commented Shlomo Yanai. “All of these served to offset weaker generics sales in Europe, which resulted primarily from the macro-economic conditions in that region.”

The rise in the generics market and the controversy over NICE’s alleged ‘bias’ against expensive new drugs are both signs that the recession is back and pharma is feeling the pressure. Non-generic blogger Maxine Vaccine asks whether the industry can stand the strain.

It’s been a hard month for the pharma industry. February is supposed to be about roses and champagne, but this year it was about closures and real pain. With Merck and AZ announcing job cutbacks and the generics market showing a marked increase, “you’re something special” is not something the industry or its representatives have heard much lately.

Generics are the drug industry’s equivalent of cover versions and remakes: the market is guaranteed and the overheads are low, what’s not to love? Well, frankly, what you save on R&D costs you lose on innovation credibility and the chance to make a medical impact. Even Shlomo Yanai is saying generics aren’t really where it’s at for his company – so it’s official: hitching a ride on patent expiry isn’t big and it isn’t Teva.

But with The X Factor churning out clones like there’s no tomorrow for the music industry (and that’s mostly because there isn’t), the day of the generic has come regardless of whether the industry feels good about it. Where respectable generic manufacturers aim at brand credibility and value-based pricing, some murky (but not Mercky) company in an obscure location will undercut them with cheap and nasty substitutes that have invaded the local formulary before you can say ‘austerity’. Think of it as payback for the CIA.

And as for counterfeit high-cost cancer drugs allegedly being made in Turkey and sold on to Egypt, then to Denmark, to Switzerland, to the UK and finally to clinics and pharmacies in the US... I may be wrong – I thought we said it couldn’t happen here? Face. Bothered? Yes.

And back home, we’ve got the two Sir Andrews – Witty and Dillon – squaring up like the ‘History Today’ professors over NICE’s alleged message to GPs: New cancer drugs? Just say no. Behind the polite sparring, the underlying sarcasm is unmistakeable. Both parties are saying: See that person who wouldn’t know value-based pricing if it wore a T-shirt saying ‘Here comes VBP’? That’s you, that is. But who sent who the Twitter message Back off or we’ll form a committee to modernise your face, our sources have been unable to determine.

After years of horrible fashions we’re about due another Mod revival. That underrated movement had the slogan Clean living in difficult times. That’s something we should all aspire to. In an ugly world, having (and deserving) a good reputation is vital.

Maxine’s views are not necessarily those of Pharmaceutical Field.

Teva Pharmaceutical Industries is seeking to expand its branded drug portfolio and make more acquisitions, downplaying its reputation as a generics supplier.

This follows a year in which its acquisition of US specialty pharmaceutical company Cephalon saw Teva benefit from growing sales of MS drug Copaxone, while its sales of generics in the US declined.

Chief Executive Shlomo Yanai (pictured) said the Israel-based company does not want to be dependent on one ‘blockbuster’ product – an implicit comment on the ‘patent cliff’ faced by some leading pharma companies this year.

Yanai’s impending replacement (in May) by Jeremy Levin, who oversaw BMS’s ‘string of pearls’ acquisition strategy, has been interpreted as meaning that Teva will expand through takeovers of smaller companies.

Teva is the world’s leading supplier of generic drugs, but in 2011 its sales of generics in the US fell by 32%.

The company’s $6.5bn acquisition of Cephalon, which closed in October, was the main factor in the 28% rise in sales that Teva saw in the fourth quarter of 2011 – bringing its 2011 sales revenue to $18.3bn, 14% above the 2010 figure.

Sales of Copaxone, which passed $1bn in the last quarter, made up one-sixth of Teva’s entire quarterly revenue – but in 2012, the drug’s sales are expected to peak due to growing competition.

Yanai commented: “Our answer is not just in developing drugs but in reducing our dependence on this product.” He also said he was “optimistic about the continued growth of Teva in the branded products sector,” and that the company was examining opportunities for acquisitions.

2011 also saw Teva acquire Japanese company Taiyo and partner with Procter & Gamble to supply OTC medicines. Analysts have suggested that the company may seek to purchase Shire, a specialist in drugs for rare diseases.

However, Teva has no plans to abandon the generics market, which Yanai said may pick up in 2012 due to the worsening US economic crisis.

Teva forecasts 2012 sales of $22bn, compared to $18.3bn in 2011 – including $8.2bn from branded drugs, compared with $6.5bn in 2011.

Dr Rob Koremans, currently Senior Vice President for Generic Strategy and Development at Sanofi, has been appointed President and CEO of Teva Europe.

Koremans will take over both roles from Dr Gerard van Odijk, who has held the positions for six years, in March 2012.

Prior to his current position, Koremans was CEO of Sanofi’s European generics business Zentiva. He has also been Serono’s Vice President for Europe.

Shlomo Yanai, President and CEO of Teva Pharmaceutical, said that with van Odijk’s leadership “our business in Europe has been transformed as Teva became the undisputed generics leader in this major and growing market and established a strong position in speciality pharmaceuticals.”

He added: “I am very confident that Rob Koremans, together with our strong European management, will continue our success story across Europe.”

The President and CEO of Teva Pharmaceutical Industries Shlomo Yanai is to retire from the company in May 2012 and be replaced by the experienced Dr Jeremy Levin.

Dr Levin is a former senior executive at Bristol-Myers Squibb and has more than 25 years in the pharmaceutical industry including spells at Novartis and Cadus Pharmaceuticals.

Phillip Frost, Chairman of the Board of Directors at Teva, says Dr Levin is an “exceptionally talented business leader with a deep understanding of the opportunities and challenges of the pharmaceutical industry”.

Mr Yanai, who has been President and CEO since 1 March 2007, says he plans to move on to a new phase in his career.

During his time in the role Mr Yanai helped lead the company from a mainly generics business to a diversified pharmaceutical company with expected revenue this year of approximately $22 billion.

Teva’s board say they conducted an “extensive search process” to find Mr Yanai’s successor and opted for the “recognised strategic vision and deep knowledge of the pharmaceutical industry” of Dr Levin.

“He brings to Teva a wealth of experience and the hands-on skills required to foster the growth of a global pharmaceutical business,” said Phillip Frost. “As a business leader and as a physician, he is passionately committed to bringing effective treatments to patients, worldwide. His combination of vision, creative energy and an effective team-building management style make him an ideal choice to lead Teva into its next growth phase.”

The new President and CEO said he has watched the progress of the company for a number of years whilst working within the industry. “I have known and admired Teva for many years, not just as a global leader in generic drugs, but as an outstanding innovator in pharmaceutical development and new strategic approaches to serve patients worldwide,” he said. “Demographic trends and economic pressures in developed and emerging markets are intensifying the challenge to provide good medicines at affordable prices. Teva, with its multiple platforms in generics, branded, and OTC drugs, is in an especially good position to meet this challenge. It will be a privilege to work with the talented and dedicated people of Teva to fulfil this mission.”

Teva Pharmaceutical has completed the full acquisition of Japanese firm Taiyo in a $934 million cash deal.

The deal for the generics manufacturer follows an agreement in May this year which saw Teva purchase a 57% share in Taiyo for $460 million.

Shlomo Yanai, President and CEO of Teva, says the acquisition is an “important milestone” for the company.

Israel-based Teva is the largest generics company in the world and had aimed to increase its presence in Japan. The deal will see the company add more than 550 products to its existing portfolio and meets its Japanese strategy.

There is a relatively low generic market in Japan, although it is now being actively encouraged by the Japanese government.

Taiyo currently has annual sales of approximately $530 million with Teva now expecting to exceed its original 2015 target of exceeding sales in the country of $1 billion.

“The acquisition of Taiyo, along with Teva’s existing Japanese business, assures that Teva will deliver on our strategic objective of becoming a leading player in Japan,” said Shlomo Yanai.

Teva Pharmaceutical Industries has agreed a definitive acquisition for Cephalon in a deal worth approximately $6.8 billion.

The Jerusalem-based company bid almost 12% more than takeover rival Valeant Pharmaceuticals in a transaction it predicts will create the leader in speciality pharma.

Shlomo Yanai, President and CEO of Teva, says the company is “delighted” to be working together with the Cephalon team on a “new and exciting future for Teva”.

The deal is not conditioned on financing and is expected to be completed later this year.

The acquisition will create immediate and sustainable value in a number of niche therapeutic areas including CNS, oncology, respiratory and pain management.

Teva says it will utilise its newly purchased commercial, R&D and operational capabilities and aims to capture value by providing customers with a broad spectrum of speciality branded products from its sizable branded portfolio, which already represents approximately $7 billion in sales. The combined company also has a robust pipeline that includes more than 30 late-stage compounds.

“This is transforming for Teva’s branded business, as it will help us to deliver on our strategic goal of creating a diversified, multi-faceted company,” said Shlomo Yanai. “We have been following Cephalon for a long time and are very happy with the opportunity to join forces. Our significantly broader portfolio will permit marketing and sales synergies and enhance profitability. We look forward to welcoming our colleagues at Cephalon to the Teva family.”

Kevin Buchi, CEO of Cephalon, says the merger with Teva is a result of a “rigorous process” by the company’s Board of Directors to maximise value and significant returns to its shareholders.

“By joining forces with Teva, we will benefit from their scale, worldwide reach and operational excellence, allowing us to further pursue our shared goals of delivering new, innovative therapies to help patients around the world,” said Mr Buchi.