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Teva Pharm expects to start out paying U.S. opioid settlement in 2023

By Steven Scheer

TEL AVIV (Reuters) Teva Pharmaceutical Industries expects to finalise an opioid settlement in the usa by year-end and begin paying in 2023, its leader said on Sunday, while confirming he was unlikely to renew his contract next year.

After years of negotiations, Israel-based Teva in July proposed a $4.35 billion nationwide settlement mostly cash and partly medicines that may total $300 million to $400 million over 13 years to solve its opioid lawsuits.

U.S. states, cities and counties filed a lot more than 3,000 lawsuits against opioid manufacturers, distributors and pharmacies, accusing them of playing down the risks of addiction and failing woefully to stop pills from being diverted for illegal use.

CEO Kare Schultz said Teva was focusing on legal wording that needs to be wrapped up by the finish of September. After that it needs approval from states and subdivisions within states.

If they opt in, once that’s all done then it switches into force and which means the initial payments happen next year and continue for 13 years, Schultz told a news conference. So, by the finish of the entire year, you ought to have this clarification that everything comes together and we’ll start paying next year.

Teva has denied wrongdoing, saying it sold legal medication that has been approved for treatment of pain.

The U.S. opioid crisis has caused a lot more than 500,000 overdose deaths in the last 2 decades, including a lot more than 80,000 in 2021 alone, in accordance with government data.

Schultz, who took over as CEO in December 2017, confirmed he was unlikely to increase it his contract which expires on Nov. 1 2023, saying he’ll be 62. But he said he’d like to stick to the companys board.

He said Teva would spend less further by closing a few of its sites. Since 2017 it has reduced the amount of manufacturing plants to 53 from 80 also it plans to close another 10 within the next couple of years.

Tevas NY listed shares are up 10% up to now in 2022 at $8.81 but well off a peak of $72 in 2015.

Questioning the reduced share price, Schultz noted that Teva includes a price-earnings ratio around 3.5, whereas a standard rate ought to be 10. Teva has among the lowest P/E ratios of any share I understand, and the business enterprise is in fact very stable, that may grow longterm and generate cash so its excellent for longterm investors, Schultz said.

At this time we have been worth a third of what you would start to see the normal value if we didnt have these risk factors.

He suggested that the reduced share price largely stemmed from high debt, which includes drop to $20 billion from $34 billion, and the opioid litigation.

(Reporting by Steven Scheer; Editing by Alison Williams, Frances Kerry and Emelia Sithole-Matarise)

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