Teva sharpens ax, preps brutal cuts in R&D and across the group in face of crushing debt
The word out of Israel today is that Teva is prepping a round of brutal cuts, with plans to shutter an R&D center and lay off up to 10,000 staffers.
The R&D center is in Netanya in Israel. Calcalist is also reporting that the company will sell off a logistics center as it looks to slash up to $2 billion in costs in the next two years in the face of crushing debt payments.
Teva already recently announced that R&D chief Michael Hayden is leaving the company after 5 years, signaling big changes for its research operation.
Just ahead of the news, former chairman and interim CEO Yitzhak Peterburg abruptly resigned with immediate effect — signaling that the fallout in Israel will likely be intense.
The unions are already reportedly organizing protests against the layoffs, with government officials likely to jump in as well.
Teva, though, has little choice at this point. New CEO Kåre Schultz stepped in to a company that took on $35 billion in debt as it built up its generics business just ahead of a turn for the worse in that business. Its R&D operations, meanwhile, have proven to be woefully inadequate to the task, with some severe setbacks as its franchise branded drug faced cheap knockoffs of its own.