Teva CEO says production and distribution in Israel remain largely unaffected by war
Head of the world’s largest generic drugmaker unveils program to address the growing need for care as more than 2 million Israelis are expected to suffer from trauma symptoms
Sharon Wrobel is a tech reporter for The Times of Israel.
Israel’s Teva Pharmaceuticals Industries Ltd. said Tuesday that manufacturing has not been affected despite the country being more than four months into a war with the Hamas terror group, and many of the company’s employees having been absent from work.
“We were not prepared for something of this incident happening, [but] at the same time we had plans in place to make sure that our manufacturing and our distribution could function,” Teva CEO Richard Francis said at a press briefing in Tel Aviv. “We built secondary supply routes so if manufacturing was interrupted, we could produce from other facilities around the world.”
With global headquarters in Tel Aviv, the world’s largest generic drugmaker operates four production sites in Israel, including manufacturing sites in Kfar Saba and Neot Haviv, a development center in Netanya and a logistic center in Shoham.
Manufacturing volume that comes out of Israel makes up less than 8 percent of global production, and from a revenue point of view, it accounts for about 2% of Teva’s total worldwide. The drugmaker has 50 sites around the world employing a workforce of 37,000 people, of whom 3,385 are based in Israel.
Similar to many other businesses and tech companies around the country, a few hundred Teva employees, or at least 10% of its workforce, were called up for reserve army duty with the outbreak of the war on October 7, when Palestinian terrorists killed some 1,200 people and kidnapped hundreds of others. To cope with the threefold increase in demand for medications in the first weeks of the war, many employees from Teva’s headquarters mobilized to help out at its distribution center, the drugmaker said.
In recent weeks, the army has been gradually releasing many of the reservists fighting in the Gaza Strip so they can go back to their jobs.
While production has remained largely unaffected by the war, Francis recognized the toll the fighting is taking on the daily lives of the company’s employees and the rest of the country.
“The resilience of the team at Teva Israel is extraordinary, which is an understatement,” said Francis. “Probably the most challenging in this period is to operate a business as fast as this on a global scale when in the background of your life you are living with constant tension, anxiety and not knowing what could happen to loved ones.”
“The level of performance [employees] operate is world-class,” he said.
Francis, who took the helm at Teva in January 2023, said that as the war is ongoing for a prolonged period, part of his job is to make sure that people understand the challenges, the trauma and the heartbreak that is going on in Israel on a daily basis.
For the world outside of Israel, “the other thing I try and do is give a perspective and a voice of Israel, which can be somehow drowned out because of how the media operates,” Francis said.
Teva, in which almost every household in Israel has a stake through pensions and savings plans, has in recent months been showing signs of stabilization and recovery from the loss of exclusivity to its multiple sclerosis flagship branded drug, Copaxone; while bringing down its high debt pile after it bought drug manufacturer Actavis Generics; and settling a flurry of lawsuits related to claims it helped drive the US opioid epidemic.
Francis described 2023 as a year of transformation to bring the firm back to growth. The generic drugmaker, which last month reported that revenues rose 15% to $4.5 billion in the fourth quarter of 2023 year-on-year, said it expects lower profit but higher sales for this year coming from its pipeline of products.
Talking about his experience over the past year in Israel, Francis, a former Novartis and Biogen executive, said that “as a company, Israel is our secret strength, that people don’t recognize.”
“Is there any other company in a country that could have been part of a war and still performed the way it did?” Francis asked, referring to Teva. “It is because of the essence of our DNA, which is in Israel, and this is a strength we have.”
With the need for care staggering, Francis said that in the wake of the Israel-Hamas war, Teva created a fund for the training of therapists to help Israelis cope with trauma and symptoms of post-traumatic stress disorder (PTSD) that he assessed are likely to impact more than 2 million people.
The fund seeks to increase the number of therapists and care facilities, as well as leverage technology to enable remote meetings. As part of the program, 200 therapists will be attaining their certification by the end of February, after finishing their professional training.
