CopyofTevareport04.19.15

March 30, 2015Companies: ACT, AZN, BIIB, HSP, MYL, NVS, PFE, SLXP, TSE:VRX, TLV:TEVA
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301 Battery Street, 2nd Floor, San Francisco, CA 94111 | www.blueshiftideas.com
Teva’s Long-Term Success Will Depend on Strategic Acquisitions
REPORT
Linda Richards, lr@blueshiftideas.com
Summary of Findings
 Eleven sources who commented offered mixed responses on the
likelihood of Teva Pharmaceutical Industries Ltd. (TLV:TEVA)
overcoming its growing competition as well as the patent cliff for its
Copaxone, an injectable multiple-sclerosis (MS) treatment. Some
said Teva likely will tackle these issues, while others said it would
do so only through strategic acquisitions and co-developments.
 Teva’s generic Nexium and the impressive patient conversion rate
to its 40-mg, thrice-weekly Copaxone in the United States will allow
it to weather the release of Mylan Inc.’s (MYL) generic Copaxone
injectable. Pushback by PBMs will vary. Many sources expect Teva
to offer significant rebates to minimize share loss.
 Teva CEO Erez Vigodman’s initiatives are viewed as mostly
successful. Thirteen sources described Teva as powerful and
innovative, while three noted a loss in strength for the company.
 Five sources said Teva’s pipeline is strong, while four said it is
promising but lacks a blockbuster. Teva’s move into other
injectable products and biosimilars should boost its growth.
 Teva’s challenges include pricing pressure from government
scrutiny both in and out of the United States. Sources were mixed
regarding the threat from Pfizer Inc.’s (PFE) acquisition of Hospira
Inc. (HSP), and said competition stems from Biogen Inc.’s (BIIB)’s
oral MS drug Tecfidera, along with Mylan and Actavis plc (ACT).
 Seven sources forecast higher generic sales for Teva this year, one
UK source cited lower sales related to regulatory issues, and two
distributors said their Teva orders can vary much based on pricing.
 Unlike Blueshift Research’s Jan. 31, 2014, findings, sources more
recently were unaware of employee morale issues at Teva.
Teva’s
Initiatives
Effective
Teva’s
Generic
Sales 2015
Acquisitions
Key to Teva’s
Success
Pharma Distributors,
Executives
Competitors
PBM Executives N/A
Industry Specialists
Research Question:
Will Teva’s growth initiatives be enough to overcome the Copaxone patent cliff and
increasing generic drug competition?
Silo Summaries
1) Pharmaceutical Distributors and Pharmacy
Executives
Five of these seven sources are in the United States,
and are mostly positive about Teva’s growth
initiatives, but four also said Teva must seek out
major acquisitions and co-developments to overcome
the Copaxone patent cliff and the increase in its
competition. The three U.S. sources who commented
on Teva’s 2015 generic sales predicted an increase,
while two cited great variability in their own
companies’ Teva product purchases because of price
fluctuations. Teva’s generic version of Nexium holds
the most potential.
2) Teva Competitors
Four of these six sources represent U.S. competitors,
including two who said Teva will have trouble
overcoming the patent cliff and competition in the
long term if it does not introduce significant products.
Of the two non-U.S. sources, one said Teva has lost
share in the United Kingdom because of regulatory
issues, while one said the company faces pricing
challenges in Switzerland. Sources said Teva remains
a strong leader, but two said it has lost some power.
Teva’s generic Nexium carries high potential.
3) PBM Executives
These four sources said PBMs will vary in their efforts
to convert patients to the generic Copaxone and will
take rebates from Teva into account. Most were
unsure of Teva’s ability to overcome the patent cliff,
but said the company is a strong, savvy player.
Government scrutiny may slow generic drug price
increases. Oral MS drug manufacturers pose the
biggest threat to Teva.
4) Industry Specialists
These six sources offered mixed responses regarding
Teva’s ability to weather its Copaxone patent cliff and
its increased competition. One said Teva is well
situated to benefit from company initiatives, while
three others said Teva’s success will depend on
retaining Copaxone patients or making other major
acquisitions. Two of four expect higher proprietary
and generic sales for Teva this year. Several sources,
including two MS experts, reported being impressed
so far with the conversion rates of patients to Teva’s
40-mg, thrice-weekly Copaxone.

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Teva Pharmaceutical Industries Ltd.
Background
Teva’s fourth-quarter revenue fell by 4%, but its earnings were slightly ahead of estimates and the company maintained its
2015 outlook. Although its generic drug revenues fell by nearly 8% in the fourth quarter, the sector’s profitability rose by a
healthy margin because of the company’s aggressive cost-reduction efforts. Also, Teva’s injectable MS drug Copaxone saw
revenue decline because of competition from recently introduced oral drugs, but its results still beat Wall Street expectations.
Congress has gotten involved with generic price increases, with a subcommittee sending letters to Teva and 13 other generic
drug manufacturers.
Since February 2014, Teva has been under the direction of CEO Erez Vigodman, who has focused on cost cutting and profit
enhancement. Vigodman also has laid out a plan that includes reorienting the company toward inorganic growth, focusing on
business development, pursuing complex generic and specialty drugs, launching seven new generics in 2015, and
maintaining as many Copaxone patients as possible.
Copaxone, which makes up 21% of Teva’s sales and 50% of its profits, is facing the end of patent protection in September
2015. Generic drugs could put heavy pressure on Copaxone as generic small molecule drugs usually capture 70% to 90% of
the market share from the original brand. Teva is engaging in a legal strategy to protect the patent from early elimination. In
addition, it secured FDA approval for a new, longer-acting formulation and is aggressively converting patients to the thrice-
weekly Copaxone. To date, it has converted 63% of its patients and has secured 25.9% of newly diagnosed MS patients. In
2017 Teva settled a deal in order to offer a generic Viagra two years early by paying Pfizer Inc. (PFE) royalties.
Blueshift Research’s Jan, 31, 2014, report found sources were optimistic about Teva’s future and Vigodman’s ability to lead a
company turnaround. Sources highlighted Teva’s strong generic drug portfolio, rich pipeline and reformulated Copaxone as
strengths. Teva’s challenges included converting patients to the thrice-weekly Copaxone, improving employee morale, and
dealing with healthcare reform.
Current Research
In this next study, Blueshift Research assessed whether Teva’s growth initiatives would be enough to overcome the Copaxone
patent cliff and increasing competition. We employed our pattern mining approach to establish five independent silos,
comprising 23 primary sources (including 13 repeat sources) and seven secondary sources focused on the rising costs of
generic drugs, drug company regulations in Europe, and feedback on Teva’s new 40-mg, thrice-weekly Copaxone:
1) Pharmaceutical distributors and pharmacy executives (7, including 2 not in the United States)
2) Teva competitors (6, including 2 not in the United States)
3) PBM executives (4)
4) Industry specialists (6)
5) Secondary sources (7)
Next Steps
Blueshift Research will monitor Teva’s growth initiatives, including acquisitions and product co-developments, and its product
approvals and launches. We also will research the adoption rate of the 40-mg Copaxone and the effects of generic Copaxone
use on Teva’s brand-name version.
Silos
1) Pharmaceutical Distributors and Pharmacy Executives
Five of these seven sources are in the United States, and are mostly positive about Teva’s growth initiatives, but four also said
Teva must seek out major acquisitions and co-developments to overcome the Copaxone patent cliff and the increase in its

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competition. The three U.S. sources who commented on Teva’s 2015 generic sales predicted an increase, while two cited
great variability in their own companies’ Teva product purchases because of price fluctuations. Teva’s generic version of
Nexium holds the most potential in the company’s relatively strong pipeline. One source each in Finland and Canada
described Teva is a strong, competitive company, but said pricing will depend on legislation.
Key Silo Findings
Teva’s Overall Performance
- All 5 U.S. sources said Teva’s growth initiatives are somewhat likely to very likely to overcome the patent cliff and
competition, but 4 said success is contingent on strong acquisitions and co-developments.
- All 7 sources said Teva is a solid, innovative leader, and most believe Teva’s CEO has the right strategies.
Teva’s Growth Potential
- All 3 who commented predicted higher generic sales for Teva in 2015 year to year. 2 noted considerable variability in
their companies’ Teva purchases because of price fluctuations.
- 2 said generic Nexium holds great potential. 1 said Teva’s generic Nexium is 80% to 90% of the brand name’s cost.
- 3 who could comment on Teva’s pipeline said it’s good to strong.
- Individual country legislation dictates non-U.S. pricing, with Copaxone pricing higher in Canada than in Finland.
Teva’s Challenges
- 3 said the Pfizer/Hospira merger will be a threat to Teva, but 1 disagreed.
- U.S. sources were mixed on the Copaxone market: 1 said Teva likely will retain 75% share, 1 said market retention
was a possibility, but 2 said this was unlikely due to PBMs’ efforts to cut drug costs.
1) Experienced pharmaceutical sales professional who is a buyer for a closed-door pharmacy; repeat source
Teva’s generic sales growth likely will be “phenomenal” in 2015 because of industry consolidation. Its proprietary sales
will depend on the R&D investment and the pursuit of co-development partnerships. Teva’s success in dealing with the
patent cliff will depend on acquisitions. Going into the generic injectable market could be profitable for Teva. In addition
to the generic version of Nexium, its upcoming asthma and contraceptive drugs hold potential.
 “The likelihood of Vigodman’s and Teva’s success really comes down to their strategy. … The potential is there just
because Teva is one of the larger generic manufacturers out there. But at this point it really comes down to who is
getting exclusive rights to products becoming generic, then how much of an impact is that specific generic having on
the market and consumers actually wanting that generic the manufacturer makes. When a brand drug goes into
generic, usually one manufacturer has authorized ability to be the first to market it for the first 180 days, and that
allows them to actually create a better imprint in the market for that drug.”
 “If Teva applies the exact, same model that Actavis has, I think they will be very likely to succeed at that point. …
Actavis was a very small generic company that grew very rapidly by way of acquisitions. They acquired a lot of
different, smaller generic companies to build up their portfolio, as opposed to investing that money into R&D and
hoping for a blockbuster drug. All of that actually led up to the two major acquisitions in the last couple of years,
which is when Watson acquired Actavis and kept the name of Actavis. And then Actavis purchased Forest
Laboratories. … That model has done a tremendous amount for [Actavis’] stock price right now.”
 “If [Teva’s growth initiatives] include acquisitions, I totally agree [it can overcome the Copaxone patent cliff and
increased competition]. For some reason, I have a feeling that Teva is going to attempt to make acquisitions to
strengthen its pipeline and add new products they currently don’t carry under the Teva name, or they are going to
buy out competition in order to prevent redundancies which at that point will increase sales for them.”
 “One of Teva’s benefits is that they have a large portfolio of generic drugs. Also, with the current trend of there being
large pricing spikes due to shortages of raw materials, if Teva is able to actually position themselves well enough to
be able to take advantage of that, then they open themselves up to having a stockpile of needed drugs.”
 “[Teva sales growth for generics in 2015] is probably going to be phenomenal. … I see a lot of consolidation
happening within the industry, specifically with the larger manufacturers. I know that with the current strategy that
Actavis has, there are rumors that Actavis is supposed to be acquired by Pfizer. If something like that happens, then

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the only players of that stature on the generic side will be Teva and Mylan that can actually compete with them, and
that will be a very big coup for Teva.”
 “[The large manufacturers such as Teva] are able to keep better control over [smaller wholesalers’] access to drugs
and, in turn, make the amount of money that they actually want to make without there being a bidding war that
usually leads to lower prices. … In the industry I was in there is a certain thing called contract pricing, which is
basically a way in the system to prevent, say, a larger or secondary distributor from selling to a smaller distributor;
this prevents other people from getting into the market specifically selling those products.”
 “[As for Teva’s proprietary sales growth in 2015] I think it’s more a question of how much more Teva has invested in
R&D. If they have attempted to actually increase the budget for R&D to [have] a better approach in producing more
proprietary products, then I think they have a great opportunity to actually do a lot better in that area. But if their
budget isn’t really focused [on R&D] or they aren’t at least attempting to do co-partnerships with other existing
companies that probably have the infrastructure to help co-create proprietary products, then I don’t think that they
will be able to have as much of an impact on that side of the market.”
 “[The] injectable market is actually a very great strategy [for Teva] to go into
right now just because I know that a lot of people have been paying
attention to that market. And it doesn’t have too many players on the
generic side that are actually able to take advantage of it. Because of that,
there are usually a lot of shortages in the injectable market, which in turn
allows a large price increase that is usually absorbed by hospitals.”
 “I view Teva’s pipeline as strong due to their attempting to create a diverse
portfolio of drugs. The most exciting drugs from this pipeline, however,
would have to be asthma medication and contraception. … If they allocate
enough funds to properly market these items, they have the best chance of
creating some blockbuster drugs.”
 “Getting the first approval to launch generic Nexium ... will be a very big
opportunity for Teva simply because Nexium is one of the last few
blockbuster drugs that the industry has been waiting for the patent to
expire.”
Teva’s Challenges
 “In the injectable market, in comparison to Hospira, you’d look at Teva like
a startup and Hospira as a multibillion-dollar conglomerate that has been in
this specific business for a very long while. They won’t even actually cross
each other’s paths.”
 “It’s definitely possible [that 75% of patients will remain on the non-generic Copaxone or on the 40-mg Copaxone],
specifically if that’s what the doctors are prescribing. In this market, usually a lot of individuals who are on brands
hate switching to generics if they have been taking the brand [drug] for a very long time. … I definitely believe or can
agree that a lot of the [Copaxone] clients or consumers will probably attempt to stick with the brand. I could probably
agree [with the projected 75%] if it’s within the first five years of the drug going generic.”
 “A year ago I saw Teva as simply a powerhouse generic manufacturer, but now with the strategies that they have put
in place, I see them as willing to attempt to compete head to head with the giant brand manufacturers because they
realize the potential billions that await if they are able to obtain any slice of the market share. This strategy is
impressive because it is not going to be easy, but it shows that Teva is willing to innovative and expand their range of
ideas while not being afraid to take educated risks. By educated risks, I mean that Teva is attempting to make an
impact on the difficult yet lucrative brand side so that they can not only benefit off of a drug the 13 or so years it is
patented, but then also benefit on the generic side after the patent expires because they already have a major
impact on that side of the industry.”
2) Executive at a mail order pharmacy that primarily serves employer groups; repeat source
Teva’s initiatives probably will succeed. Without a large acquisition, however, it will only partially address the impending
loss of Copaxone revenues. Payers will have a major say in whether patients use generic Copaxone. Teva is finding it
A year ago I saw Teva as simply
a powerhouse generic
manufacturer, but now with the
strategies that they have put in
place, I see them as willing to
attempt to compete head to
head with the giant brand
manufacturers because they
realize the potential billions
that await if they are able to
obtain any slice of the market
share.
Pharmaceutical Sales Professional,
Buyer for a closed-door pharmacy

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harder to preserve its “premium brand/premium value proposition,” and has lost to competitors offering lower prices to
this source’s company; however, this constantly changes and Teva’s generic business overall should increase this year.
 “[Teva succeeding with its growth initiatives] is likely. I would say this is not a short-term fix. I don’t know if you can
compare it to McDonald’s in the sense that they can’t go back and do the true-and-tried. They’d probably have to do
something new and innovative.”
 “But it’s not going to be over a couple of quarters. … The revenue [decline] from loss of patent protection for
Copaxone is going to be much more immediate.”
 “I’d be surprised if you aren’t going to see some major acquisition initiatives from Teva in order to offset any loss on
Copaxone. Acquisitions definitely are going to be part of the arsenal.”
 “They are going to do some co-development in specialty and/or complex generics [and likely in biosimilars]. They are
going to do some co-development, and I think they are going acquire some drugs if they are likely to be approved so
they can generate incremental revenue.”
 “Teva is a premium brand in generics, along with Mylan and [Novartis AG’s/NVS] Sandoz. They are typically higher
cost for the same generics than many other manufacturers, but they have a better quality reputation. … But
obviously in a commoditized market and a market where there is a lot of price scrutiny, it’s much more difficult to
maintain that premium brand/premium price value proposition. That’s something they will have to continue to work
on. I think the best way to do that obviously is to take out costs.”
 “We sell a lot of [Teva generics]. It’s probably one of our larger manufacturers historically. It’s changing as we speak.
Some of the other less-known competitors seem to have gained some pricing power over Teva, but it’s drug by drug
and almost minute by minute.”
 “Despite high utilization and the number of manufacturers, there’s still
generic drug price inflation taking place, so [Teva] has that benefit. But
reducing sourcing and manufacturing costs [is] hard work. It isn’t something
that you do that easily overnight. I am sure they will be successful. It’s just
going to take time.”
Teva’s Challenges
 “I would suspect multiple manufacturers will come into the market [with
generic Copaxone] as soon as they can, just as you have seen with some of
the other large brands that went off patent.”
 “Once it opens up, [the price] is going to fall very quickly.”
 “There’s a chance [of Teva keeping 75% of its patients on the 40-mg
Copaxone]. … When [Teva says they] converted [patients], that means they
are working with the clinicians and the doctors, but I think money is going to make that determination as to how
successful [Teva is] going to be. And the payers are going to have a very large say.”
 “[Payers] may very well put the two versions [generic and brand name] of the same drug on vastly different copay
tiers. That is going to drive behavior … especially as more and more employers and payers are moving people to high
deductible plans. And for specialty drugs, the copays are typically a percentage now.”
 “Absent a major acquisition, [Teva’s] growth initiatives are unlikely to partially offset the Copaxone patent cliff in the
near to medium term. Longer term they will likely succeed.”
 “[The increasing generic drug competition] is a headwind for them as well, but that’s not something they haven’t
dealt with in the past.”
 “I don’t know that [Pfizer buying Hospira] is any bigger threat to Teva than what is going on [with consolidation]
overall in the market.”
 “Pfizer has a screen, and everybody in the world who is in pharmaceuticals is on Pfizer’s screen somewhere. Pfizer
lost Lipitor a couple of years ago, if I remember right, and now they have another big drug coming off patent so they
have to work twice as hard as Teva. I think Pfizer is looking to do a lot of deals and they have a lot of money too.”
Miscellaneous
 “Teva is a big company with a lot of success. They know what works. … Probably the reason the former Teva CEO
[left] and the new CEO came in was they hadn’t prepared significantly enough for this event that everyone knew was
on the calendar. This new CEO was brought in to try and accelerate and catch up, but for large companies with a
global footprint, it’s not easy.”
Absent a major acquisition,
[Teva’s] growth initiatives are
unlikely to partially offset the
Copaxone patent cliff in the
near to medium term. Longer
term they will likely succeed.
Executive, Mail Order Pharmacy

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 “On these biosimilars, the initial indications are that they are going to be 10% to 20% less expensive than the
originals, but obviously you don’t need that many of those drugs to make up for a large number of revenue given that
the drugs are much more expensive than the typical generics.”
 “The FDA [recently] approved the very first biosimilar application [Sandoz’s Zarxio]. … What they haven’t really done
is issue guidelines. A biosimilar isn’t identical to the original drugs like they are for generic drugs. …. [I]t is generally
the same, but what they haven’t done is all the research showing that the outcomes are going to be the same as
they are able to do with generics. … Is this a strategy that in the near term is going to help [Teva] generate
incremental income? That’s still to be seen.”
3) Independent pharmacist owner; repeat source
This pharmacy gets Teva products from its wholesale buying group when those are the least expensive, which occurs
about 20% of the time. Pfizer’s acquisition of Hospira could be a major danger to Teva, depending on the product mix
involved. The Teva generic Nexium that the pharmacy has received is maybe 10% to 20% less than the brand name.
Teva’s growth initiatives may succeed, but pricing volatility and acquisitions are unknown factors.
 “[Teva CEO Erez Vigodman] could have some success [with the initiatives.] I think there’s a lot of volatility in the
generic pricing market. I am sure there are quite a few different generic houses that are probably going to be coming
on the market that he could either buy or merge with and so on.”
 “Again, I think there is a tremendous amount of volatility in the generic pricing. I’m hoping that will stabilize over the
next 12 to 24 months. And I would hope that he could bring some stability to [Teva’s] pricing. I don’t think he could
do it for the whole market.”
 “I do have some Teva that occasionally comes in the mix. … We belong to a
buying group, and it depends on what the deals that they cut per month
are.”
 “It’s so competitive. Like I say, if Teva is not the best deal, then [the buying
group] just isn’t going to buy it. … That’s the reason I get sporadic products;
it might be Teva, it might be another brand. … Probably 20% of the time at
most we get Teva brands as being the most economical.”
 “I doubt [physicians know a generic version of Nexium is available]. It’s so
new.”
 “The [generic Nexium] we have is very high [priced]. It’s probably 80% to
90% of the brand cost.”
 “[The generic Nexium] is going to have to get past the six-month exclusion, if
that is in existence [where] Teva is the only one [supplying it]. And I’ll tell you
why it’s priced so high as a single source: When it goes multisource, the
price will drop down and it will be much more economical. I think the PBMs
will actually pay for it then. Rarely ever do PBMs pay for the products that are in that six-month exclusivity range.
They prefer that they just go ahead and get the brand name. ... PBMs will leverage the manufacturer, they leverage
the providers.”
Teva’s Challenges
 “[Teva] is going to struggle with [a merger between Pfizer and Hospira]. Pfizer is a great, big name, and they are
highly competitive.”
 “I don’t handle Copaxone, so I am not sure [if they can keep 75% of patients on the 40-mg Copaxone].”
 “If PBMs follow suit with how they do everything else, they are going to steer [patients] away from the [Copaxone]
brand to the cheaper generic. Copays, the prior approval process—that’s how they steer the customers [who are] the
patients.”
 “You’d think [Teva’s growth initiatives] would help [it overcome the Copaxone patent cliff and generic drug
competition], but I just don’t know. Like me, they are trying the best they can, and sometimes it doesn’t work out.”
[Teva CEO Erez Vigodman]
could have some success [with
the initiatives.] I think there’s a
lot of volatility in the generic
pricing market. I am sure there
are quite a few different
generic houses that are
probably going to be coming on
the market that he could either
buy or merge with and so on.
Independent Pharmacist Owner

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4) Pharmacist in the wholesale drug business; repeat source
Generic drugs are Teva’s “bread and butter,” but the company is trying to move more into proprietary drugs to capitalize
on the pricing profitability. Teva will see a considerable hike in generic sales for 2015. It could retain 75% of its Copaxone
patients by paying PBMs a rebate to equal the generic price.
 “[Teva and its CEO are] somewhat likely [to succeed with their initiatives]. I just think they have the money behind
them, they have been pretty successful in the past, and they have a pretty good reputation in the industry.”
 “Every generic company is looking to raise prices. The competition dictates that. They are not able to able to in a lot
of instances. I don’t think [Teva is] one of the leaders in increasing prices, but when the competition does increase
prices, it doesn’t take them long to follow.”
 “Teva just got the generic Nexium. They have been pretty successful in
getting approvals in the last year. These are not dog items—items that have
no volume. These are all big-volume items.”
 “Nexium did just go over-the-counter, but Teva is still going to do very well
with a generic Rx.”
 “Teva is going to have some exclusivity [with generic Nexium]. They already
do because they are the only one that has it right now, and it’s under
allocation too. They can’t supply the demand. We can only buy so much.”
 “I think Teva’s bread-and-butter is generics. But the brands have a big
advantage because they can just have a price increase to make up for loss
of volume, and that’s what the brand companies have been doing for 50
years. I don’t think that’s going to be a major part of [Teva’s] business but …
I bet you they are trying to get more into the proprietary brand side because
it’s so profitable with price.”
 “I don’t think [Teva’s proprietary sales] are going to accelerate [in the second half of 2015]. I think it might increase
some.”
 “Teva’s generic sales are going to increase considerably. … They just recently had a price increase on a big, big
volume item.”
 “[Generic drug sales will accelerate in the secandond half of 2015] because of [generic] Nexium and price increases.
And they may get some other approvals that we aren’t aware of.”
 “I think their pipeline in generics is very good. There’s a lot of competition
with enoxaparin.”
 “I’m not familiar with Teva’s proprietary pipeline. I couldn’t comment on
that, but I wouldn’t think it would be very big. I tell you one thing: The
injectable market has a lot of potential.”
 “The topicals have gone through the ceiling on the generic side in the last
two years. That’s because they were too cheap before and a lot of people
just got out of the market because it wasn’t profitable.”
Teva’s Challenges
 “[The Pfizer/Hospira merger is] going to be a tough competitor. Hospira has
a very big injectable line. Their service level on a scale from 1 to 10 is probably a 2 or 3. … Pfizer is going to have the
money to get that straight. And the first thing they are going to do is raise prices.”
 “[The competitors rising in strength] are always going to be the same big boys. Mylan, I understand, is in acquisition
mode. They have a ton of cash. And look at what Actavis has done in the last few years. Actavis has really gone
through the roof, and they have acquired some big brand companies like Forest Labs.
 “Dr. Reddy’s [Laboratories Ltd./BOM:500124], an Indian company, is turning into a big player. Pfizer has Greenstone
as their generic division. And … supposedly pretty soon there’s going to be some Chinese companies coming into the
generic market.”
 “I don’t think [Teva will achieve 75% of patients staying on the non-generic Copaxone or the 40-mg, thrice-weekly
Copaxone once it goes off patent] because everything is [about] price today, and the PBMs … control everything . The
[Teva and its CEO are]
somewhat likely [to succeed
with their initiatives]. I just
think they have the money
behind them, they have been
pretty successful in the past,
and they have a pretty good
reputation in the industry.
Pharmacist, Wholesale Drug Business
I bet you they are trying to get
more into the proprietary brand
side because it’s so profitable
with price.
Pharmacist, Wholesale Drug Business

8
doctor can’t practice medicine anymore because the PBM tells him what they are going to pay for and what drugs
they are going to cover.”
 “Let me tell you what is going to probably happen and how Teva [could keep 75% of patients on Copaxone]. The
PBMs could say, ‘OK, we will keep using your Copaxone. Instead of us paying [X amount] we are going to charge [that
amount], but you are going to give us a rebate to match what the generic price is.’ … And Teva would probably say
‘Yes,’ because, if not, they are going to lose the business.”
 “Teva may come out with their own generic. So they’ll have a generic Copaxone. The terminology used for that is
‘AG’—’authorized generic,’ which just means it’s the same as the brand product.”
Miscellaneous
 “Teva is a solid company. We have a good relationship with them. They give us good service, competitive prices.”
 “The oral MS drugs are so darn expensive. Some of them were cheap, but they have had price increases.”
5) Manager of a pharmaceutical wholesaler and distributor in Canada
Teva is in a strong position to overcome the patent cliff and compete effectively against other generic drug companies. It
rebranded Copaxone in a way that both created interest among users and allowed the company to hold onto the patent
longer. In addition, Teva’s portfolio is stronger and more complicated than its competitors. The provincial Canadian
governments are working on limiting generic drug pricing. Whether the governments will encourage patients to change
from Copaxone to a generic remains unclear, especially since that 40-mg, thrice-weekly Copaxone may not be released in
Canada and European countries until later in the year.
 “Teva is a strong company, and they have made some smart moves. They should be OK. Introducing the newer
Copaxone was a smart idea because with the new U.S. rules, they can hang onto the patent a bit longer. Some of the
other generic companies have smaller, less complicated portfolios, and I don’t think they will be much of a threat.”
 “Copaxone three-times-weekly is not approved in Canada or, I believe,
Europe yet. It should be coming out in some European countries very soon,
but I’m not sure when it will be introduced here. … Some people with MS
are looking forward to it because they are tired of daily injections.”
 “Teva has its own distributors in Canada. We are not involved with their
drugs. We also hear that their minimum order is very high, so this is not
something that we could compete with.”
 “Canada has an evolving cap price on generic drugs. Our prices are higher
than in Europe, possibly as high as some U.S. drugs, but various province
governments are working at bringing these prices down.”
 “I don’t know anything about Teva’s employee morale.”
 “Teva has always been considered a strong company. There was some
concern last year, with a new president, but they have done well.”
 “Because we don’t sell Teva drugs, it is hard for me to comment on their proprietary or generic sales this year. I really
couldn’t say except to say that they have some strong medications on the market.”
Teva’s Challenges
 “There have been a lot of drug mergers, and anytime there is one, the other companies are threatened. They should
feel threatened given that they may be faced competing with near-monopolies.”
 “Once Copaxone three-times-weekly is presented to Canada and Europe, then it may well experience [total] sales of
more than 63%. It is inevitable. Consider this: The new Copaxone may not be introduced for several months yet,
which means that patients will just be adjusting to it when a generic might come out, say, in the fall. Would they
switch to the generic then? Doubtful, unless they are forced to do so by insurers.”
 “Granted, there is a push everywhere for cheaper generic drugs. If a generic Copaxone comes out, patients, insurers,
governments will have to think about this. What price do they pay … for a transfer?”
Our prices are higher than in
Europe, possibly as high as
some U.S. drugs, but various
province governments are
working at bringing these
prices down.
Manager, Pharmaceutical Wholesaler
& Distributor, Canada

9
6) Director of business development at a pharmaceutical distributor; repeat source
This source would not speculate on Teva’s ability to overcome its challenges but said the company is playing the game
correctly. The 40-mg Copaxone version will extend the patent and may help Teva hang onto market share for a bit longer.
Teva may try to offset drugstore chain and government contracts, but it should not assume its prices will be accepted.
She doubts if the 40-mg Copaxone will reach 75% of total Copaxone sales. Insurance companies almost always dictate
the lower-priced brand drug or a generic drug over a brand name.
 “Teva has pulled the old ‘double-the-strength’ of ‘make-it-extended-release’
or ‘get-another-indication-approved’ strategy to extend their patent on
Copaxone. Many brand companies have done this over the years in hopes
of hanging onto some market share.”
 “If Teva continues to believe people will pay more for their generics just
because it’s a Teva product, that’s a slippery slope, and their market share
will decline.”
 “With higher prices presumably to certain sectors of the market, it appears
like they have chain drugstore and possibly even government contracts
where the pricing is extremely low, so they’re attempting to offset.”
Teva’s Challenges
 “I do not believe the [40-mg Copaxone] sales will hit 75% [of total Copaxone
sales]. The generic single-strength will still do well when available. These
days insurance companies dictate what prescriptions the doctors write, and it’s always going to be the generic, even
if the drug must be taken more often.”
 “Years ago, when generic drugs were starting to gain market share, nearly everybody wanted Mylan generics
because they were tacitly led to believe [Mylan generics] were better than other versions. Well, that worked for a
while but does not hold true today.”
7) Manager for a pharmaceutical distributor in Finland
Teva may succeed based on its large generic-drug presence in Europe. Finland’s government controls drug prices; people
who want drugs outside of the controlled drug “tube” may chose an original brand, but they must pay the price difference
unless the brand is recommended by their physician.
 “Teva is one of the largest generic drug companies in Europe. It may do
well, but I really don’t know.”
 “Drug prices vary from country to country [in Europe]; it depends on the
legislation. In Finland, we have a price development act that dropped drug
prices by 40%. The ministry determines the price tube.”
 “Drug prices in the Nordic countries are very controlled by their
governments. All drugs have the same price in every pharmacy. There is
some free trade that is fully priced.”
 “We deal little with Teva. We only sell brand drugs and not very many MS
drugs. I do not know about their president or morale. I have not met anyone
who works for Teva.”
 “Teva is well known in Europe, but I don’t know their drugs to comment.”
Teva’s Challenges
 “Patients won’t necessarily be forced to go to generic [Copaxone]. In Finland, patients are reimbursed for MS drugs
100%. They get all drugs for free unless they chose an original brand that is not in the price tube. If they chose to
I do not believe the [40-mg
Copaxone] sales will hit 75% [of
total Copaxone sales]. The
generic single-strength will still
do well when available. These
days insurance companies
dictate what prescriptions the
doctors write.
Director of Business Development
Pharmaceutical Distributor
Drug prices vary from country
to country [in Europe]; it
depends on the legislation. In
Finland, we have a price
development act that dropped
drug prices by 40%.
Manager
Pharmaceutical Distributor, Finland

10
take an original drug, then they pay the price difference. The doctors may choose to decline a substitution, and the
patient can then stay on the original drug.”
2) Teva Competitors
Four of these six sources represent U.S. competitors, including two who said Teva will have trouble overcoming the patent cliff
and competition in the long term if it does not introduce significant products. Of the two non-U.S. sources, one said Teva has
lost share in the United Kingdom because of regulatory issues, while one said the company faces pricing challenges in
Switzerland. Sources said Teva remains a strong leader, but two said it has lost some power. Teva’s generic Nexium carries
high potential. Sources were unaware of employee morale issues at Teva. (can omit strong leader sentence if needed)
Key Silo Findings
- 2 who could comment said Teva will have trouble overcoming the patent cliff in the long term.
- No source was aware of Teva employee satisfaction or morale issues.
- No U.S. source was aware or had seen a change in Teva’s sector strength since last year.
- 2 European sources said Teva has lost share in the United Kingdom and faces pricing challenges in Switzerland.
- Teva is a strong leader, but 2 said Teva was not as strong as in the past.
- Teva’s generic Nexium carries high potential.
- Specialty drugs (immunology, neurology and respiratory) also will be important.
Teva’s Challenges
- 2 said Teva can reach and retain 75% brand Copaxone but one says it won’t be enough.
- 3 cited oral MS drugs as a major threat.
1) Senior pharmaceutical sales representative
Teva is a classic generics company, strong in contracting and distribution, but the company may not be able to repeat
Copaxone’s success with another branded drug. A 65% conversion rate to the thrice-weekly Copaxone version would be
an achievement. However, Copaxone sales will flatten and ultimately will decline in the face of more efficacious and oral
options. Expansion into more generics and specialty drugs makes sense for
Teva and plays to its strengths.
 “Teva sees the world through a generics lens. Their strengths really lie in
the legal/regulatory team. They are aggressive in patents and generics
development. They have literally revolutionized the approach to executing
rights and distribution contracts.”
 “The specialty focus is a good direction for Teva.”
 “I expect conversion to the three-times-per-week Copaxone would have
been difficult as it requires a lot of training, increased technical support, as
well as the need to get both prescribing physicians and payers onboard. If
the 65% conversion is truly accurate, this is a good indication for both
continued conversion and persistence.”
 “Copaxone will flatten and ultimately fall in the face of newer drugs with
greater efficacy and oral dose options.”
 “Teva works with a lot of research centers in fields like immunology and
neurology. There is potential for novel drug pipeline.”
I expect conversion to the
three-times-per-week Copaxone
would have been difficult as it
requires a lot of training,
increased technical support, as
well as the need to get both
prescribing physicians and
payers onboard. If the 65%
conversion is truly accurate,
this is a good indication for
both continued conversion and
persistence.
Senior Pharmaceutical Sales
Representative

11
 “Teva is viewed as a generics company, by both healthcare professionals and investors. There is no brand
preference in this world. Here their channel strength is a big asset.”
Teva’s Challenges
 “The concern with Teva is that they may be a one-hit wonder with regard to branded drugs. Copaxone is huge, but
Teva’s identity is a generics company. They may be too reluctant or too conservative to expand on their branded drug
success.”
 “Branded drug competitors are Teva’s greatest competition.”
2) CEO of a drug manufacturing competitor
Teva will receive a short-term boost from its 40-mg Copaxone and generic Nexium, but its prospects after six months are
dim because of fierce competition. In addition, acquisitions will be difficult to accomplish because of inflated prices.
 “The new CEO wants to get back to the generics space. They want to compete in the generics space, but they won’t
be able to [as in the past]. Competition is so fierce. You can go buy a prescription drug for two pennies when you
can’t even buy candy for that.”
 “Teva missed out in the emerging markets.”
 “I don’t know about their current employee situation.”
 “I don’t know that they’ve gotten stronger since a year ago. I believe Teva will not be able to compete in the generic
space that Teva was doing so well in a decade ago. In fact, I just came from DCAT in New York City: Not once did I
hear or see Teva’s name there. I didn’t realize that until you asked the question.”
 “They’re getting bigger in generics; they’re getting back to their roots.”
 “In proprietary they have Copaxone, and they have bought some time with
their [40-mg version].”
 “They got lucky with Nexium, and it will help them but not after six months.
That’s one reason I’m not that excited for them.”
 “The rumored merger with Mylan is not going to happen; it’s not a good fit.
As for acquisitions, I don’t think there’s a good acquisition at a fair price.
Salix [Pharmaceuticals Ltd./SLXP] was bought by Valeant [Pharmaceuticals
International Inc./TSE:VRX], and look at the premium they paid.”
Teva’s Challenges
 “The Pfizer/Hospira merger is a good one for Pfizer. I don’t think that’s a negative for Teva. At the conference I just
attended, everyone is buying into injectables and complex generics. But it’s too late [for Teva].”
 “They may get to 75% [of the Copaxone brand market], but that’s is not enough to sustain a business like Teva. I do
expect the generic companies will be ready to roll it out. It will happen sometime this year. Even if it’s early 2016,
that’s only a couple months [reprieve for Teva.]”
 “They’ve absolutely missed out in the oral MS market. [Biogen’s] Tecfidera has done $2 billion, [Novartis’] Gilenya
has done $1.5 billion.”
 “The [generic] Nexium and the Copaxone [40 mg] will definitely help them short term, but long term, no.”
3) Senior marketing director
Based on the high conversion rate to thrice-weekly Copaxone, retaining 75% patients on brand-name Copaxone should
be achievable. The conversion rate is indicative of patients’ persistence, at least in the short term. Any new side effects
or reduced efficacy with the formulation would result in lost sales. Oral medications are a threat to Teva.
 “Based on Teva’s current conversion rate, I expect 75% to be achievable. That said, I don’t know the data behind
their three-time-per-week formulation.”
The [generic] Nexium and the
Copaxone [40 mg] will
definitely help them short term,
but long term, no.
CEO, Drug Manufacturing Competitor

12
 “Those patients who switched to three times per week may have done so
fairly recently and may not be interested in making another switch in the
immediate future. You could take their switch as a sign that they are
reasonably happy with Copaxone and committed to staying with it for the
time being. After all, they’ve had the opportunity to switch to a competing
therapy for some time now and have chosen not to. I would project decent
persistence among those patients.”
Teva’s Challenges
 “I see the high conversion to three times per week as a positive sign, but the
newer oral therapies likely remain a threat.”
 “Any new side effects emerging with the three-times-per-week formulation could be a significant problem. Some of
the converted patients may have switched to three times per week because they are tired of daily injections. If they
encounter new side effects or perceive disease progression, however, they may abandon Copaxone.”
4) Director at a midsized competitor
Teva is a large, successful company that will benefit from continued price increases and mergers although it was of many
manufacturers named in the investigation into generic drug pricing. This source was mostly unfamiliar with Teva’s growth
initiatives, but said the company’s strength was in line with last year.
 “Teva is so big. A lot of our customers think they’re a bit arrogant. The small and medium-sized feel like they get the
short shift from them.”
 “[Some price increases] are going to continue for a while, but [Teva and other companies] can’t raise prices without
justification or rationale. There’s a Senate committee investigation. Ten or so players were mentioned who raised
prices 100% in certain situations. Teva was one of them; fortunately we didn’t appear on it.”
 “For the longest time generic prices didn’t tend to increase, and it would get so competitive, sometimes dropping
20% to 30% to get share. But with players dropping out and due to mergers, six manufacturers came down to one or
two, maybe three. There’s been a lot of price increases because of opportunistic reasons. It presented an
opportunity for us to get prices back up and to reinvest in our plans.
 “I haven’t heard anything, and I would probably know about any morale issues.”
 “The strength [of Teva’s generic and proprietary sectors] is about the same. They were on an acquisition binge for a
while there, so they’re huge. They have so many SKUs, I don’t know how their salespeople know what to focus on in a
call. When they stumble or have a supply issue, we pick up their crumbs, and they tend to be big crumbs.”
Teva’s Challenges
 “[Its 40-mg Copaxone] is an important play for extending their franchise, to the chagrin of the generic
manufacturers.”
 “I don’t have a good feel for what a realistic rate, but 63% [conversion to the 40-mg Copaxone] is impressive.”
 “I’m not familiar enough with their growth initiatives to comment.”
5) National channel manager for a large pharmaceutical company in the United Kingdom
Teva will have to move cautiously and correct regulatory or licensing issues in the United Kingdom in order to overcome
competition. Eight of the company’s drugs were cited by the government in the last three years, thereby allowing generic
competitors to fill the void. Although the source was unfamiliar with Copaxone, he said Teva’s strong respiratory portfolio
may help it overcome difficulties in the country. Pricing is strongly regulated by the UK government and is much lower
than in other European countries. He doubts pricing will increase this year.
I see the high conversion to
three times per week as a
positive sign, but the newer
oral therapies likely remain a
threat.
Senior Marketing Director

13
 “Teva will have to move cautiously in the UK and correct medication problems in order to overcome competition. I’m
not familiar with Copaxone, but they have a strong respiratory portfolio, one that we would like. They have a good
group of respiratory products to take to market, which will help them take on competition.”
 “Teva is not doing as well as it has in the past in the UK. They have always been the No. 1 manufacturer here, but in
the past few years they have had licensing issues. Teva is bailing itself out of regulatory issues right now; they had to
withdraw some products, and that opened doors for [us]. Other companies are benefitting as well.”
 “Pricing is probably lower here than in the rest of Europe. I know that pricing
in Germany is higher. The UK National Health System controls pricing and
keeps it very low. I doubt if pricing will increase this year.”
 “I am not sure how Teva is received in the rest of Europe.”
 “I haven’t heard anything out of the ordinary about employee dissatisfaction
with Teva.”
 “It will be interesting watching Teva make a comeback in the UK.”
 “It will take Teva awhile to grasp a stronger handle on the UK market for
both generic and proprietary drugs.”
 “I’m not familiar with Teva’s new or developing products although they have
been in the news.”
Teva’s Challenges
 “I’m not familiar with the Pfizer/Hospira merger.”
 “Teva will need to prove to the UK that all of its products are safe and efficacious.”
6) Marketing access analyst for a large pharmaceutical company in Switzerland
Teva is a strong company, has a top reputation in Germany and Switzerland, and has a top portfolio of varied products, all
of which will help it compete. The source was unfamiliar with Copaxone. Drug prices are controlled by the various
European governments. As a result, he does not expect prices to climb very much this year. To increase operating
margins, pharmaceutical manufacturers must control costs.
 “Teva has a top reputation in Europe, especially Germany and Switzerland. I don’t know Copaxone, but they have a
top portfolio of varied products and do well against the competition. I don’t see why they won’t continue to do well.”
 “The bottom line is operating margin, and you have to control costs. Of course, drug prices are high in the United
States, and people always complain about it. I don’t know if the new insurance act is helping that or not.”
 “Germany’s drug prices are controlled by the government; they do go up
but not very much. The Swiss government is currently in debate with drug
companies in order to have some of the lowest prices in Europe, and this
would mean slashing the current prices. I’m not sure how it will work out.
Every country controls its own pricing according to internal structure.”
 “Generic drugs are now encouraged here, and I believe they are
automatically given.”
 “Teva may have had some problems in the UK, but that kind of thing does
happen.”
 “I’m not too familiar with Teva because our products are different. We do
not compete directly.”
 “I still feel that Teva is a strong company. There are a lot of good
competitors, such as Sandoz and subsidiary Hexal, both which are part of Novartis. But Teva has a nice, varied
portfolio, and they make both brand and generic products, so they know how to play the game.”
 “We don’t compete directly against Teva, so I couldn’t tell you about their products.”
Teva’s Challenges
 “There are always a lot of mergers in pharmaceuticals. That happens all the time. I’m not sure how much of a threat
Pfizer and Hospira are to Teva, although Hospira is strong here in Europe.”
Teva is not doing as well as it
has in the past in the UK. They
have always been the No. 1
manufacturer here, but in the
past few years they have had
licensing issues.
National Channel Manager
Large Pharmaceutical Company
United Kingdom
Teva has a nice, varied
portfolio, and they make both
brand and generic products, so
they know how to play the
game.
Marketing Access Analyst
Large Pharmaceutical Company
Switzerland

14
3) PBM Executives
These four sources said PBMs will vary in their efforts to convert patients to the generic Copaxone and will take rebates from
Teva into account. Most were unsure of Teva’s ability to overcome the patent cliff, but said the company is a strong, savvy
player. Government scrutiny may slow generic drug price increases. Oral MS drug manufacturers pose the biggest threat to
Teva.
Key Silo Findings
- 1 of 4 thinks Teva will face challenges with Copaxone patent; others were not sure or didn’t know.
- 2 of 4 said government attention to generic drug costs will force Teva to be more attentive with pricing.
- 2 of 4 were unaware of sector changes since 1 year ago; 1 expects higher generic sales this year, but 1 said sales
will be flat for Teva.
- Teva has a strong pipeline, but 1 said it lacks a blockbuster.
Teva’s Challenges
- The Hospira acquisition will be a positive for Pfizer, but only 1 views it as a threat to Teva.
- 3 said Teva is a strong, progressive player but added that Sandoz, Mylan and Biogen are strong competitors.
- PBMs’ Copaxone response will vary and will depend on cost difference: 1 expects to exert significant pressure to
convert patients that are the 40-mg version to the generic version.
- 2 said oral MS drugs are the biggest threat.
1) Pharmacy vice president of a large PBM; repeat source
Teva should fare well as its CEO is making the right moves. Still, pipeline drugs and future acquisitions are unknown
factors. A 15% to 20% price difference between the generic and brand Copaxone would be typical. This PBM likely will not
be aggressive in moving patients off the 40-mg Copaxone if they are doing well on it. Oral MS drug manufacturers are
Teva’s biggest threat. The strength of Teva’s two sectors has not changed since a year ago.
 “They will be all right. The new CEO is doing is exactly what he should be doing, making them leaner while putting
emphasis on drug development and acquisitions. They’re setting it up well, and now the big question is whether their
new drugs will pass muster. And what other assets can they acquire that
will complete their offerings for them?”
 “Their acquisitions goal makes sense.”
 “I don’t have any knowledge about their sales force or employee turnover.”
 “Are they a bigger player than a year ago? Not necessarily.”
 “The strength of Teva’s proprietary and generic drug sectors hasn’t
changed since a year ago. I would think their proprietary and generic sales
would be comparable to last year’s. Our industry relations folks certainly
haven’t come to us saying that we’re getting gouged by them.”
 “There have been more multiyear contracts, which are largely about price
inflation.”
Teva’s Challenges
 “As far as major competitors, I think the main one is Biogen’s Tecfidera,
which has been able to gobble up a lot of market share. If I were Teva, I would be moving from injections to oral.”
 “From a national perspective, there won’t be a big plan to get people off the thrice-weekly if they’re responding well.
… Once this type of injectable is deemed appropriate, then you might see clients work on a regional basis. But I don’t
They’re setting it up well, and
now the big question is whether
their new drugs will pass
muster. And what other assets
can they acquire that will
complete their offerings for
them?
Pharmacy Vice President, Large PBM

15
know if everyone will go that route. You don’t want to bring the hammer down, because patient satisfaction is
important.”
 “It’s not like the old medication, such as Prozac, which dropped from $1 a pill to a penny. We’re not seeing those
kinds of price scenarios playing out, because the drugs are inherently more expensive. If I can get 15% to 20% price
difference [with the generic Copaxone], that would be good. But at $2,000, that can have a significant impact.”
 “The whole biosimilars and complex generics are in a place where we just don’t know how it’s going to play out.”
2) CEO of a midsized PBM; repeat source
Teva will do well until the Copaxone patent expires. This PBM expects to actively pressure patients on the 20-mg and 40-
mg versions of Copaxone to use the generic, primarily through high copays, and estimates as few as 10% of patients will
remain on the brand name.
 “The little I’ve read about [Teva CEO Vigodman] is he’s bold and sounds like he’s slashed a lot, cutting deep in places
like sales force. But who knows? Maybe they needed that. He will either do well or blow up.”
 “We are rooting for [Teva]. We used to depend on their manufacturing on the generic side. I believe we lost a lot of
generic SKUs, which was partially responsible for these sky-high prices. I may be wrong about that, but that’s what
I’ve been led to understand. They were driving competition. The more generic drugs they manufacture, the better.”
 “There are a lot of prices that have just skyrocketed the last 12 to 18 months. … They’re going to have to slow down
these price increases.”
 “I never heard about the sales force morale issue.”
 “[Their generic and proprietary sectors are] about the same. They sure are putting a lot of emphasis on the Copaxone
brand.”
 “They’ll do well in their proprietaries and increase market share on the generic side, but it depends on pricing. Most
generics are sold to wholesalers, and GPOs do big deals with Teva. It all boils down to how competitive they get.”
 “I looked at their pipeline and it certainly looks promising, but a pipeline is a
pipeline. You never know with the FDA. However, their upcoming ones are
not products we have a lot of therapeutic need for; they’re not
blockbusters.”
 “I know Teva has a generic Nexium, which should do well. But they’ll have to
reduce the price because AstraZeneca [plc/AZN] released an OTC product
that dropped the price.”
Teva’s Challenges
 “Hospira has been doing [injectables] forever. I don’t know if or how Teva
will be affected, but Hospira is hooking up with a pretty sound company with
Pfizer. Those [drugs] are used more in hospital patient use, which I used to
do. [Manufacturers] don’t have as much of a free hand to do what they want
with injectables.”
 “Another competitor that has a similar model would be Sandoz. Mylan … will
continue to do well.”
 “If you would have asked me if they would be as successful in moving patients to the long-acting version, I would
have said no, but they’ve had great success. They’ll have more trouble holding it when the patent expires. They might
hold 10% of it. They can always back the pricing down to keep share. We’ll have some trouble with biosimilars, but
with generic Copaxone I’m not viewing it much differently [from the brand]. We’ll push everything we’ve got, including
disincentivizing members who chose not to go to the generic. Primarily we do it with equalizing the difference
between the brand and generic and putting pressure on the member’s copay.”
 “During the next six months [Teva] will be OK and will increase revenues and market share, but in six to 12 months
they’ll have some challenges.”
We’ll push everything we’ve
got, including disincentivizing
members who chose not to go
to the generic. Primarily we do
it with equalizing the difference
between the brand and generic
and putting pressure on the
member’s copay.
CEO, Midsized PBM

16
3) Executive vice president of sales; repeat source
Teva has a solid sales team and distribution system, which will help it address its challenges. Some insurers may force
Copaxone patients to switch to the generic version. All generic drug manufacturers are under pressure to keep pricing
down, and Teva is one of the first companies to start a direct-to-patient model. The source said Teva should monitor the
Pfizer/Hospira merger.
 “Teva has a good sales force, one of the best, and a good distribution method. It is one of the better, more notable
brands, so they are in a good position to meet challenges. They may have to develop an even better distribution
system in the future.”
 “Teva and the other manufacturers will be under pressure to keep prices down.”
 “Generics, and this includes Teva, keep increasing the prices because they think they can. Since branded is out of
the way for the most part, generics are trying to be branded. But they are really pseudo-branded.”
 “I can’t address Teva’s strategies. But to offset costs, generics are getting stronger and forming relationships with
wholesalers and retail chains. Some [such as Teva] are starting a direct shipping program to consumers. As primary
branded drugs turn generic, the shipping program is beneficial because it can help retain the customer.”
 “PBMs are setting up third-party pharmacies, and they can ship the drug out on behalf of the manufacturer. They are
now serving as a distributor, so to speak. This saves them money as well.”
 “Teva has always been a strong player.”
 “I can’t address Teva’s sales or their pipeline.”
 “When I first started in this business … brand [name] held 80% of the
market. Now it holds 15% in our and other PBMs’ plans.”
Teva’s Challenges
 “There is a general belief that Pfizer is one of the premium companies.
Whatever they want, they will figure it out. ... Teva will need to keep an eye
out [on the Pfizer/Hospira merger].”
 “I’ve heard a bit about Copaxone. Certainly the convenience of less dosing
would have consumer appeal and help protect the patent, but I couldn’t
make a guess on patient retention.”
 “The Copaxone plan was designed because generic will be out there eventually. It is hard to say if an insurer would
force a patient to change from Copaxone, if it were successful, to a generic. This probably would depend on the
plan.”
 “It will be hard for the branded companies to get their stronghold back. Manufacturers are in a weaker position. The
primary mistake the brand made was to give rebates on the copay. This worked when the copay was at a certain
level, but when the copay reached $25 to $40, then folks started turning to generics.”
 “Specialty drugs increase a plan by 13%. It is a high-margin marketplace. Now with healthcare reforms,
manufacturers and PBMs have to justify what they have done.”
Miscellaneous
 “PBMs make more money on generics.”
4) Marketing director of a new PBM
Teva is formidable company that is playing hard in the generics market, but it must differentiate itself to overcome the
patent cliff and competition. This source questions if the 40-mg, thrice-weekly Copaxone is as beneficial as the daily
version. The government is putting a lot of pressure on PBMs and manufacturers to lower costs. As healthcare costs
increase, more mergers will disrupt technologies.
 “There are so many factors that go into the [patent cliff]. Teva will need to differentiate itself from what is out there to
succeed.”
Teva has a good sales force,
one of the best, and a good
distribution method. It is one of
the better, more notable
brands, so they are in a good
position to meet challenges.
Executive Vice President of Sales

17
 “Teva is looked at as a progressive, innovative company, and it is cornering the market on the generic piece of it. And
that is a smart move. At the end of the day, that is where the push is, to go generic—from the government to private,
employers to payers. It is all about reducing the cost and still providing a positive patient outcome.”
 “Generic prices will increase, but they will not be higher than brand. This goes back to the government, who is putting
a lot of pressure on the PBMs and drug manufacturers. And whether you have the Affordable Care Act or not, it is
costing you money.”
 “There are a lot of things that companies can do to increase operating margins. There’s technology and investors,
and they make a huge difference. It is all about keeping costs down. I don’t know how Teva does it.”
 “Teva has a strong and varied portfolio.”
 “I haven’t done a lot of research on Teva’s pipeline. They are a reputable
company, so if they say they will come out with a new drug, you will see it.”
Teva’s Challenges
 “If Pfizer is buying Hospira, that is a very good move. As we see the costs of
healthcare rising, we will see more companies merge and disrupt technology
so that they can advance.”
 “I’d look for J&J [Johnson & Johnson/JNJ] to purchase companies as well.”
 “I haven’t heard about the sales of Copaxone.”
 “If you are taking a daily medication, and now it is three times a week, the question is, how is it sustaining that
disease?”
 “Insurers will push for [brand-name Copaxone] users to switch to generic when it becomes available. It is all a matter
of cost. If there is a generic out there that does the job at 90% [of the brand-name price], then they will have to prove
why it is that they need the brand.”
 “If you have a chronic disease, it is about the quality of life. People have to take that into consideration.”
Miscellaneous
 “Biosimilars will disrupt technology if it hasn’t already. It’s the new future.”
 “It will still cost money to do the biosimilar research, to run the manufacturing and operations part of it. How do you
get your return on investment? If the [product] costs are high, companies can always offer rebates.”
4) Industry Specialists
These six sources offered mixed responses regarding Teva’s ability to weather its Copaxone patent cliff and its increased
competition. One said Teva is well situated to benefit from company initiatives, while three others said Teva’s success will
depend on retaining Copaxone patients or making other major acquisitions. Two of four expect higher proprietary and generic
sales for Teva this year. Several sources, including two MS experts, reported being impressed so far with the conversion rates
of patients to Teva’s 40-mg, thrice-weekly Copaxone. One European and three U.S. sources noted pricing pressure for Teva.
Sources said the company’s generic Nexium and upcoming tamper-resistant opioid product hold high potential.
Key Silo Findings
- 1 forecast success for Teva in overcoming the patent cliff and competition, while 3 said major acquisitions and
retaining Copaxone patients will be necessary for success.
- 3 of 4, including 1 source in Europe, reported government pressure in limiting generic price increases.
- 1 said Mylan’s generic Copaxone will be 10% to 12% cheaper than Teva’s brand name when it comes out.
- 2 of 4 each expect higher Teva proprietary and generic sales in 2015 year to year.
- Teva’s NTE (New Therapeutics Entity) program bodes well with current U.S. legislation.
- 3 view Teva’s pipeline as promising but without blockbusters; 1 said its pipeline is very promising.
- 4 forecast high potential for Teva’s generic Nexium; 1 mentioned Teva’s upcoming tamper-resistant opioid analgesic.
Biosimilars will disrupt
technology if it hasn’t already.
It’s the new future.
Marketing Director of a New PBM

18
- 2 MS specialty sources laud Teva’s 40-mg Copaxone, said switches from it to the generic likely will not be
considerable.
- 40-mg Copaxone conversion is impressive; 3 of 4 forecast high patient retention rate for Copaxone brand name.
Teva’s Challenges
- 2 said Pfizer/Hospira merger poses a threat, 2 said it doesn’t.
- Rising competitors include Biogen, Valeant, Actavis and Mylan.
- 2 said oral MS drugs are the biggest threat.
- PBM efforts often depend on cost difference; most will be aggressive if price difference after rebates is 15% to 20%.
1) Carl Schmidt, a business development and consulting executive for biopharmaceutical companies; repeat source
The Teva CEO has done a “pretty good job” from a financial perspective but where the company is headed strategically is
not completely clear. Acquisitions and development deals are needed to overcome the patent cliff. If the FDA does not
permit other companies to sell their generic versions of Nexium, Teva’s sales could be “huge.” Mr. Schmidt does not
think Teva will be able to transfer 75% of its Copaxone patients to the 40-mg, thrice-weekly version
 “[Erez Vigodman] has been the CEO for maybe over a year now, and he’s
actually increased the operating margins already but that’s not surprising. It
wouldn’t take much to actually do that, because Teva did a lot of business
development deals over the last 10 years or so and integrated a lot of
different companies. And there are always going to be synergies that you
have to kind of get rid of.”
 “From a financial standpoint, I think [Vigodman] has actually done a pretty
good job. From a strategic standpoint on the businesses, I am not sure that
it’s really clear exactly where they are going. There’s definitely an interest
[on Teva’s part] on the specialty side, because you have patent protection
and aren’t constantly fighting the battle over pricing to the extent that you
do with generics.”
 “There are a number of factors [affecting the likelihood that Vigodman and
Teva will succeed] because when they talk about complex generics, then
they start talking about injectables. Are they talking about potential biosimilars? … Are they looking globally, or are
they going to focus kind of on the markets they already have?”
 “I don’t see Teva taking the route that Actavis did and buying somebody like Allergan or something like that. I do see
some small acquisitions that Teva could do.”
 “Valeant is a good example of a company that’s grown significantly in the branded and specialty markets based on
buying a lot of small companies. I think that’s really the only way to go because Teva doesn’t have strong R&D. They
are not a big pharma R&D organization by any stretch of the imagination, so
their only avenue is really co-development or acquisitions. They can’t build
an R&D organization in a very short timeframe and start pulling out
products. They have to buy products or companies that have products in
late-stage development.”
 “The generic drug pricing trends will kind of hit Teva in the European
marketplace because there’s a lot pressure to lower those prices. In the
U.S., it seems to be kind of hit-or-miss; some generics have actually gone up
in price over time in certain categories due to scarcity and limited other
generics. … There’s always going to be pressure from [U.S.] health plans and
from PBMs to lower [the higher] generic prices to actually increase their own
margins. It’s hard to say whether Teva is going to increase their share of the
overall generic marketplace; they are not known as having the least
expensive products.”
 “I heard something not too long ago … that morale at Teva wasn’t really
great. Teva has done some consolidation. They have closed plants, and they
From a financial standpoint, I
think [Vigodman] has actually
done a pretty good job. From a
strategic standpoint on the
businesses, I am not sure that
it’s really clear exactly where
they are going.
Business Development & Consulting
Executive, Biopharmaceutical
Companies
Valeant is a good example of a
company that’s grown
significantly in the branded and
specialty markets based on
buying a lot of small
companies. I think that’s really
the only way to go because
Teva doesn’t have strong R&D.
Companies

19
have laid off people. Whenever you do that, your morale is going to be low. And the previous CEO and even the
current CEO, I don’t think, communicate the plan particularly well to the organization.”
 “Teva’s proprietary group, because of recent acquisitions, is a little bit stronger than it was a year ago.”
 “[As for] the generic sector, I know they have a couple of new drug approvals and things like that. We’ll just have to
wait and see what happens with those.”
 “Teva has an agreement in place with AstraZeneca to sell an authorized
version of Nexium. … This could be a potentially huge sales number unless
the FDA allows others to sell their generic versions. … If Teva has the only
product available in the U.S. market, they could take up to 80% of the
Nexium business within three to four months as a relatively high price point.
If other generics become available very soon, the price point will drop very
quickly.”
 “Is Teva a little bit stronger compared to its competitors? It depends on who
you define as its competitors. If I were looking at proprietary, for Teva, their
No. 1 product is Copaxone. I think [Teva’s] competitors’ strength for
treatment of MS is a lot stronger than Copaxone is. Probably the No. 1
company for MS is Biogen Idec.”
 “I saw something not too long ago that said the expectation for Mylan for
2015 is that they will have greater than 10% growth. That means they are on
a stronger curve than Teva, because Teva’s not going to have 10% growth
on the generic side unless they are doing something. … Granted, they have
some new generic approvals, but Mylan has a lot more than they do.”
 “[Teva’s 2015 proprietary sales] depend on whether they launch the
products they say they are going to launch in the second half of the year. [If they do,] I expect they will do mid- to-high
single digit increase in sales. … If they are going to launch [the new products] in either the second or third quarter,
they will bring in some cash. The generic Copaxone won’t come out until September, which means if they take any
hit, it will be in the fourth quarter. They are going to take some hit, but I don’t see them going from the level they are
at and losing 80% of their [Copaxone] business within three months.”
 “I can almost guarantee you that when Mylan comes out with a generic [Copaxone], the price is going to be about
10% to 12% less expensive than what the brand is because they want to make as much money as they can during
that 180-day period. After that, the prices will drop significantly.”
Teva’s Challenges
 “I don’t see [the proposed merger between Pfizer and Hospira] as much of
a threat to Teva. I think it’s a great opportunity for Pfizer. Teva will be
competing with them in what I call the complex injectable generic
marketplace. It’s kind of a specialty generic marketplace. I think the
advantage of this from Pfizer’s standpoint is the biosimilars it’s picking up
[from Hospira]. Hospira has two approved biosimilars already on the market
in Europe, and they can expand that out from a global perspective, not to
mention the U.S. marketplace.”
 “I don’t think Teva will achieve switching 75% of patients to the new dosage
regimen. I think with the newer launched products with similar or better
dosing regimens or the new oral formulations will capture some of
Copaxone’s share and switches. Teva’s ability to hold its market share will
be challenged [over the next year] by the generic version and newer
injectable and oral products.”
 “Once the generic Copaxone becomes available, there’s going to be some
pressure from health plans and PBMs for patients to consider requesting a
switch. I don’t think [the plans and PBMs] can automatically switch [people
already on Copaxone to the generic]. Unless they have done a crossover
study that shows it truly is a generic equivalent, I think you are going to get
a lot of neurologists saying, ‘You know, I am not convinced the generic
makes a lot of sense.’ … This is the same issue that comes in with
I can almost guarantee you that
when Mylan comes out with a
generic [Copaxone], the price is
going to be about 10% to 12%
less expensive than what the
brand is because they want to
make as much money as they
can during that 180-day period.
After that, the prices will drop
significantly.
Companies
If Teva’s growth initiatives are
the new launches and product
approvals, I don’t see them
likely overcoming the Copaxone
patent cliff. If the growth
initiatives are not only the new
products but also new
acquisitions and business
developments deals … then it’s
a little bit more likely that they
will be able to overcome that
patent cliff.
Companies

20
biosimilars and even with [other] injectable generics.”
 “When the new generic comes out, the health plans may push new patients to try the generic first before the brand,
but that’s a small number of patients really.”
 “If Teva’s growth initiatives are the new launches and product approvals, I don’t see them likely overcoming the
Copaxone patent cliff. If the growth initiatives are not only the new products but also new acquisitions and business
developments deals … then it’s a little bit more likely that they will be able to overcome that patent cliff.”
 “Will their growth initiatives overcome the generic competition that’s out there? I’m not sure what their growth
initiatives for the generic piece of the business are unless they really do get into more specialty generics more than
anything else.”
 “If their growth initiatives are acquisitions and new product development deals for 2015, from the generic
standpoint, I think that they can really create growth as opposed to what’s occurred in 2014, which was basically flat
vs. 2013 from a sales point of view. Their operating margins were considerably higher for 2014, which is really a
pretty short-term fix. The growth initiatives take a little bit longer.”
2) Senior consultant to pharmaceutical companies; repeat source
Teva will overcome the Copaxone patent cliff and the increasing competition by innovating around the rivalry. It has been
successful in using a strong sales force to convert daily Copaxone users to the 40-mg version, and has many good but
difficult-to-formulate products in its pipeline. While competitors may be challenged by the 21st Century Cures Initiative,
Teva is in a position to take advantage of the legislation.
 “I firmly believe Teva will overcome [the patent cliff and the heightened competition]. The company is still quite
successful in converting daily Copaxone patients to Copaxone 40 [mg]. In addition, Teva has so many good products
in the pipeline that are more difficult to make.”
 “Not every Tom, Dick, and Harry in the industry can manufacture the drugs that Teva is making. Teva is good at going
after the more difficult-to-formulate drugs that are long-lasting, like time-release drugs.”
 “It would be naïve to say that Teva won’t feel the competition somewhere. But they are prepared for what will come.
Teva has innovated around the competition.”
 “Necessity is the mother of invention. This is why we’ve always been so high on generics. If it weren’t for generics,
the brand companies would never be motivated; there would be no incentive to change.”
 “Teva has three or four brand products that will be launched this year and also some hard-to-formulate generic
products. Teva has the research capability to get new therapeutic indications for their drugs and pick up another five
years. They knew all along that Copaxone would expire, and they were ready. They’ve done a great job of preparing
for that and beefing up their pipeline to fill the void.”
 “Teva will succeed. I’m not sure of their leveraged position or cash flow, but their branded stuff and new therapeutic
indications fit right in with the 21st Century Cures legislation. This legislation will be beneficial to Teva regarding
exclusivity for new uses of existing drugs, and that is what Teva’s NTE program is all about.”
 “I haven’t met the new CEO yet, but the investors and sales analysts have confidence in him. He knows what he is
doing.”
 “Teva’s president of global generics, Siggi Olafsson, is probably the brightest guy in generics, and he has helped Teva
turn the corner. With their new NTE program, which came from their past CEO, they have a robust ability to innovate.”
 “There is a lot of pressure on generics in terms of pricing right now. The Hill is getting involved. I do know that Teva’s
margins have gone up in the fourth quarter to almost 29%, and in the past four years the margins have increased
from 20% to 25.6%. But I’m not sure about going forward.”
 “I feel bullish toward Teva. My opinion on Teva has not changed from a few years back. Even then, Sandoz, Mylan,
Watson [now known as Actavis]—they all had 7% to 8% of the market share, and Teva was always up there at 18%.”
 “Teva has good brand products. Their pipeline is strong, and we are looking at three to four [new products] this year.”
 “In the Western European market, Teva is in the top three of 26 of the European markets. There are price controls in
Europe, but the controls haven’t changed and the generic market is growing. I’m not sure why.”

21
 “The FDA just approved Teva’s generic version of Nexium, the heartburn medication that has brand sales of $2
billion. AstraZeneca made a label change shortly before generic approval, and they held up the launch. But now
Teva’s esomeprazole has 180-day exclusivity, and it has good capability.”
Teva’s Challenges
 “The Pfizer/Hospira merger is not a threat. Teva already competes with Pfizer, which has Greenstone LLC and
Hospira anyway, so this is not new. Pfizer may be looking to add value to its generics side of the business, combine it
with Greenstone and possibly sell it all off in one big package. On the other
hand, Pfizer may be looking to get into biosimilars, and Hospira has a few in
the pipelines.”
 “A few generic companies like Teva, Sandoz and Hospira [are working on
biosimilars]. According to their earnings call, Teva will really have to beef up
to keep up with the second wave, which will occur around 2018 to 2020
with products that are harder to make.”
 “I didn’t think Copaxone 40 [mg] would get 50% of the total Copaxone sales.
Teva didn’t do a forced conversion; they did not take the daily off the
market. Teva has a great MS sales force, and they relied on the sales force
and their relationship with MS doctors to migrate patients from the once-a-
day to the three-times-weekly, and they have done fabulously.”
 “Three challenges could be in Teva’s favor: the opioid law, Nexium and the
21st Century Cures exclusivity. Teva has some good opportunities. The
opioid abuse deterrent industry guidance will be probably be approved by
the FDA in May. [These] molecules are patented, and the companies have a monopoly on the formulation. Teva has
submitted an NDA for a tamper-resistant opioid analgesic and is ahead of the curve on this as far as generics go.”
 “Teva’s NTE program is heavy on lifecycle management. Teva could have stopped making the once-a-day, but they
reinvented Copaxone. And they were able to gain 180-day exclusivity for generic Nexium. 21st Century Cures
increases exclusivity from three to five years for new therapeutic indications. This is right up Teva’s alley and will be
in Teva’s favor.”
3) Pharmacist, industry expert and former pharmaceutical company employee; repeat source
Teva will not experience any “magical turnaround,” and will be in for “a run for its money” if Pfizer does acquire Hospira.
Raising generic prices to improve operating margins would be problematic for Teva in the current market. Teva must be
moderately to very effective in converting and keeping patients on the 40-mg Copaxone to offset the patent cliff.
 “Short term, Teva will have some success because [Vigodman] is reducing margins [by] cutting some expenses. I
think long term, there is some concern that you can’t cut your way to profitability or more profitability.
 “They are one of the largest, if not the largest, generic company in the world. I think they will continue to be
successful, but I don’t think that you are going to see overwhelming results vs. what they have done historically. I
don’t think it’s going to be some wonderful, magical turnaround. I’d say [Teva is] somewhat likely to continue their
success.”
 “He could continue to cut to improve [Teva’s] operating margins. But to do that through price increases through [the
company’s] generic drug portfolio, I think would prove to be difficult because of the pressure in the generic business
right now. I’d say it would be somewhat difficult for them to continue to raise prices in the generic sector.”
 “Teva is having a number of new drug launches, which I think is going to put them in a much better position vs. their
competitors, but they are going to get some significant competition if the Pfizer/Hospira merger goes through.”
 “If it does, I think it’s going to give Teva a run for its money.”
 “Their generic sales are pretty solid. It appears to me that with proprietary as well as generics, companies tend to
have annual price increases. I’d say their sales in 2015 vs. 2014 for the generics would be flat to higher because
those products are already off patent. Unless you see anything unique in the generic business, I’d say their sales
would increase in 2015 over 2014. Keep in mind that’s the generic component; that’s not the proprietary products.
There’s such a risk with Copaxone [if a generic comes out in the fourth quarter].”
Teva has a great MS sales
force, and they relied on the
sales force and their
relationship with MS doctors to
migrate patients from the once-
a-day to the three-times-weekly,
and they have done fabulously.
Senior Consultant
Pharmaceutical Companies

22
 “If you are looking at their portfolio as a whole, I think it’s a nice offering. I don’t know if any of them really jump out
at me as really high potential vs. others other than the generic Nexium. That would be the one that I would think
could pose some pretty high potential, but outside of that one, I don’t think any of these are really game-changing.”
Teva’s Challenges
 “If patients have anything to say about it … you’re going to have a lot of
patients who are going to want to stay on a three-times-a-week injection vs.
a [daily] injection.”
 “I don’t think PBMs can directly force the patient [to go to a daily Copaxone
generic], but I think they can have a conversation with the doctor. You’ll
have nurse practitioners or pharmacists from the PBMs probably calling the
doctors, explaining to them that the once-daily [generic] is comparable and
that it’s a better price for all involved.”
 “[Teva keeping 75% of patients on the 40-mg Copaxone] is a very realistic
possibility. If the PBMs aren’t successful in convincing the physicians to
change it, I think you’d be very likely to get to the 75%. It’s more about
patient satisfaction and quality of life.”
 “Physicians are going to be somewhat reluctant if their MS patients are
stable to change them to a generic version.”
 “[Whether Teva’s initiatives are enough to overcome the patent cliff and
competition] has to do with how accepted the seven-days-a-week generic version is by physicians and patients. Teva
has a nice portfolio of products that they are coming out with. … I’d say if Teva is moderately to very successful in
keeping patients from moving from a three-times-a-week [proprietary] to the seven-days-a-week generic, with [Teva’s]
portfolio [of drugs coming out], that will be enough to offset the cliff.”
 “[Once there’s a generic, there will be growth for the three-times-a-week branded Copaxone]. It’s a selling point for
them. If I am a new MS patient and my insurance covers it, I only want to get a shot three times a week vs. seven.”
Miscellaneous
 “If [the MS patient] were to have a relapse, the relapse could be much more costly than the money they would save
from moving them from a three-days-a-week proprietary to a seven-days-a-week generic.”
4) Pharmacy benefits consultant; repeat source
A generic Copaxone will result in lost revenue for Teva. Most PBMs will apply pressure to move Copaxone users to the
generic if the cost difference is 15% to 20% after rebates. The generic Nexium shortage suggests demand is high, but
Teva lacks a blockbuster in its pipeline.
 “I know they have a lot of products and some general things about them, but not about their restructuring or their
CEO.”
 “We do a lot of tracking of drug prices. I’m not familiar with individual company prices. But we’re showing average
brands are increasing 11% to 12% a year. Generics have a slower rise, but it’s happening for older products.”
 “I’m not aware of the strength of their proprietary or generic drug sectors
changing since a year ago.”
 “Medicare plans are done on a yearly basis, but it wouldn’t surprise me if
Teva was doing multiyear contracts with commercial competitors.”
 “I have heard about the shortage of generic Nexium, which they’re saying is
a short-term issue. That happens a lot, especially when it exceeds their
expectations.
 “In looking at [their pipeline], there’s nothing all that exciting.”
Teva’s Challenges
 “I don’t see the Hospira/Pfizer merger being an issue. Hospira will continue
to do what they have been doing.”
 “Medicare programs will dictate what patients get, and others will require a
[Teva keeping 75% of patients
on the 40-mg Copaxone] is a
very realistic possibility. If the
PBMs aren’t successful in
convincing the physicians to
change it, I think you’d be very
likely to get to the 75%. It’s
more about patient satisfaction
and quality of life.
Pharmacist & Industry Expert
I have heard about the
shortage of generic Nexium,
which they’re saying is a short-
term issue. That happens a lot,
especially when it exceeds their
expectations.
Pharmacy Benefits Consultant

23
prior authorization from the doctor to get the Copaxone 40 [mg] if it’s a lot more expensive. I think a smart PBM
would look at the price of the 40 [mg] and the generic 20 [mg] and do what’s economically in the best interest for
the PBMs. Right now you don’t know what that cost differential is. If after rebates there’s a 15% to 20% difference, I
can see how a payer will go after that. If it’s a 5% or 10%, it’s up to the payer whether to go for it. There’s no gold
standard out there.”
 “Teva will step up to the plate and provide rebates to make sure they don’t lose much. They of course want a big
conversion to the 40 [mg] but will be competing with the generic manufacturer on price.”
 “I wouldn’t classify Copaxone as a specialty drug, and this is not something that people are concerned about, like
they are with hepatitis C. It’s not in the limelight.”
 “What they should do is become an authorized generic manufacturer for Copaxone. Then they’re just running a
different label.”
 “They’ll lose some money [when they lose the patent], but I don’t know what their balance is. They’re not going
anywhere soon.”
5) Industry expert in biologics
The reduced risk of injection-related side effects would warrant keeping a patient on thrice-weekly Copaxone. Pfizer’s
Hospira acquisition could jeopardize Teva’s expansion plans. The injectable and topical markets are growing.
 “Unless physicians can find a good reason to justify a prior authorization to the insurance company [for Copaxone],
then more than likely they aren’t going to be likely to keep people on the brand.”
 “They will be able to justify [keeping someone on thrice-weekly injections] by saying that there is lower risk of having
lipoatrophy, which is one of the side effects, and lower risk of just general injection site reaction because they are
injecting themselves less frequently.”
 “If the three-times-a-week [Copaxone] goes generic, then I think Copaxone and Teva will be in trouble. If it doesn’t go
generic, I think they are going to be safe because they will be able to justify keeping patients on branded because of
reduced side effects.”
 “Teva started the three-times-a-week study because they realized that most patients weren’t taking their [Copaxone]
medication every day and it was having the same effect.”
 “When I was selling MS drugs, one of the things that we’d ask physicians is to ask their patients to bring in any
Copaxone they haven’t used just so that physicians would get a visual of how much they weren’t taking, because
most patients were not injecting every day.”
 “If the patient is doing fine on Copaxone or whatever they are on, physicians are unlikely to switch them to another
drug. And it would really be considered bad medicine to switch them, because an MS patient could be doing fine on
a drug that a lot of people are doing terribly on, but if that particular patient is responding, then the physician
probably will not switch them regardless. They would, however, probably switch them to a generic.”
 N/A
Teva’s Challenges
 “[The proposed merger between Pfizer and Hospira] is a big threat actually [to Teva’s plans to expand its injectable
and complex generic markets] because Pfizer is a highly respected company. Pfizer knows how to do things the right
way and get it done.”
 “The injectable market is a growing market, as are topicals.”
 “An extended release [hydrocodone] would only increase the chances of a patient potentially being addicted.”
Miscellaneous
 “For the most part MS is a slow disease, so it’s very hard in a two-year study to see a lot of change one way or the
other.”

CopyofTevareport04.19.15

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