In a sudden move, Teva Pharmaceuticals announced Wednesday that CEO Jeremy Levin would resign his post.
Executive vice president and chief financial officer Eyal Desheh will replace Levin, “effective immediately,” on an interim basis while a committee searches for his permanent replacement, the company said. Deshe has served as CFO for the last five years and has been with the company for 12 years in total. Reports later Wednesday indicated that Levin had been forced out amid disagreements over job cuts and other efficiency measures.
“On behalf of the entire Board of Directors, I would like to thank Dr. Jeremy Levin for his meaningful contribution to Teva during the last two years,” Teva Chairman Phillip Frost said in a statement. “The board and management team are fully committed to the implementation of Teva’s strategy, including the development of new compounds, making strategic acquisitions, forming joint ventures and the planned acceleration of the Company’s cost reduction program.”
The Tel Aviv Stock Exchange suspended trading in Teva shares Wednesday morning for several hours following the announcement. Teva is one of the largest pharmaceutical companies worldwide, the largest manufacturer of generic drugs and the largest commercial company in Israel.
While the move is sudden, it was not without warning. On Sunday, Channel 2 quoted unnamed sources in a report that Levin and Frost were at odds over the implementation of the company’s cost-cutting measures, and that Levin had threatened to resign.
Teva denied the report at the time, calling it “baseless claims.”
Desheh, the new interim CEO, expressed confidence that the company could continue to thrive in the wake of Levin’s departure, indicating that he planned to avoid any conflicts with the board similar to those his predecessor reportedly had.
“I have full confidence in the ability of Teva’s management and employees to achieve our goals and execute the strategy laid out for the company,” he said. “My colleagues in Teva’s management and I will continue to drive execution and results in full collaboration with our board of directors, for the benefit of our patients, shareholders, customers and employees.”
The South Africa-born Levin, who took over as CEO two years ago, characterized his tenure as successful and wished the company luck, but indicated he was ready to move on.
“Since I joined Teva, we have made tremendous progress in setting a new course for the Company,” Levin said in the statement issued by the company. “I wish the company and its people, who I respect greatly, every success. I look forward to pursuing new opportunities where I can continue to apply my experience and contribute to the evolution of the global pharmaceutical industry.”
Earlier this month, Teva announced that it would lay off 5,000 employees worldwide, including 800 in Israel, as part of its cost-cutting plans. However, after the announcement caused an uproar in Israel, Levin struck an agreement with the Histadrut labor union to delay the layoffs and coordinate any future workforce cuts with the union and the state.
The layoffs were part of an ambitious cost-cutting program Levin introduced in December 2012.