Teva Pharmaceutical Industries: From 1901 Jerusalem to Eli Hurvitz, Copaxone, and the Pivot to Growth
Teva Pharmaceutical Industries (NYSE: TEVA) — 1901 Jerusalem roots; modern form 1976 merger under Eli Hurvitz. Copaxone (1997 FDA approval) was the world's best-selling MS drug at peak. Current CEO Richard Francis; "Pivot to Growth" targets 30% margin and $2.7B+ FCF by 2027.
Israeli Health & Biotech | Olam.business
Teva Pharmaceutical Industries Ltd. (NYSE: TEVA, TASE: TEVA) is the foundational pillar of the Israeli pharmaceutical industry — a company whose corporate genealogy traces back to a 1901 Jerusalem drug-distribution business operating under Ottoman rule, and whose modern form emerged from the 1976 merger of Teva, Assia, and Zori under the leadership of Eli Hurvitz. For most of the 1990s and 2000s, Teva was the world's largest generics manufacturer and the single Israeli company most identified globally with the "Israeli industrial pharmaceutical" category. Copaxone — the multiple-sclerosis treatment developed at the Weizmann Institute and approved by the FDA in 1997 — was, at its peak, the world's best-selling MS drug.
The 2015–2017 Copaxone patent cliff, the $40 billion 2016 Actavis acquisition that overleveraged the balance sheet, and a series of opioid-litigation and price-fixing settlements through 2021–2024 reshaped the company. The current chapter — under CEO Richard Francis, who took over in January 2023 — is the "Pivot to Growth" strategy: a return to focused operational discipline targeting a 30% operating margin and more than $2.7 billion in annual free cash flow by 2027.
Snapshot
| Tickers | NYSE: TEVA; TASE: TEVA |
| Founded | May 1, 1901, Jerusalem (as Salomon, Levin and Elstein Ltd.); modern Teva from 1976 (Teva + Assia + Zori merger) |
| Headquarters | Petah Tikva, Israel |
| First IPO | 1951, Tel Aviv Stock Exchange |
| Nasdaq / NYSE listing | Nasdaq 1985 (subsequently moved to NYSE) |
| Foundational CEO | Eli Hurvitz — CEO 1976–2002; Chairman 2002–2010; died 2011 |
| Current CEO | Richard Francis (since January 2023) |
| Active branded products | Austedo (Huntington's chorea, tardive dyskinesia); Ajovy (migraine prevention); Copaxone, Bendeka, Treanda |
| Manufacturing presence | Israel, North America, Europe, Australia, South America — 60+ countries served |
| 2027 financial targets | 30% operating margin; $2.7B+ annual free cash flow (Pivot to Growth strategy) |
The 1901 Origins
The corporate lineage now flowing into Teva began on May 1, 1901, in Ottoman-ruled Jerusalem, when Salomon, Levin and Elstein Ltd. was established as a small drug-distribution business. The future Israeli pharmaceutical industry was built principally by German-Jewish chemists and industrialists who arrived in Mandatory Palestine in the 1930s. The 1948 founding of the State of Israel and the subsequent immigration waves rapidly expanded the domestic drug market and drove industry consolidation through the 1960s and early 1970s.
The 1976 union of Teva, Assia (the 1935 Petah Tikva pharmaceutical plant), and Zori created the modern Teva Pharmaceutical Industries Ltd. Eli Hurvitz — who had started his career at Assia Chemical Laboratories in 1953 and had been promoted into management at Assia in 1963 — was named the merged company's first CEO.
The Hurvitz Era
Eli Hurvitz is the central figure of modern Israeli industry. He ran Teva as CEO from 1976 to 2002 and as Chairman from 2002 to 2010. The Knowledge at Wharton retrospective described him as possessing "a rare fusion of hands-on managerial ability and strategic vision, in addition to personal charisma, modesty and common sense." Eyal Desheh, who held senior roles at Teva from 1989 forward and served as acting CEO during a 2014 transition, said simply: Hurvitz is "the creator of today's Teva."
Hurvitz built the company across three decades through three structural moves. The first was the 1980 acquisition of Ikapharm — Israel's second-largest drug manufacturer — from Koor Industries. The deal exchanged 20% of Teva's equity for the Ikapharm plant; by 1984 Koor had accumulated a 42% stake and attempted a takeover, which Teva's Founders Group (composed of stockholding heirs to the company's originators) thwarted. The second was the 1984 Hatch-Waxman Act in the United States, which created statutory incentives for generic-drug companies to challenge originator patents before expiration. Hurvitz positioned Teva to use Hatch-Waxman as the springboard to US-generics dominance. The third was the 1997 FDA approval of Copaxone, the multiple-sclerosis treatment developed at the Weizmann Institute by Professors Michael Sela, Ruth Arnon, and Dvora Teitelbaum — research that had spent fifteen years isolating the COP-1 polymer that became the active compound.
By the late 1990s and early 2000s, Teva was doubling its generics business every four years (Hurvitz to Euromoney Institutional Investor, February 1998) and Globes was calling the company "this century's Israeli success story."
The Major Acquisitions
Teva built scale across two decades through a sustained acquisition program. Key transactions:
- 1996 — Approved Prescription Services / Berk (UK) and Biogal (Hungary)
- 2000 — Novopharm (Canada, $400M) — made Teva the largest generic pharmaceutical company in North America
- 2004 — Sicor — combined Teva's oral-dose generics franchise with Sicor's injectable and biogeneric capabilities
- 2006 — IVAX Corporation (US, $7.4B) — significantly strengthened the global subsidiary network
- 2008 — Barr Pharmaceuticals (US, $7.5B)
- 2011 — Cephalon (US, $6.8B) — Teva's first major branded-specialty acquisition
- 2016 — Allergan's generics business (Actavis) — approximately $40 billion. The transaction overleveraged the balance sheet and triggered the multi-year debt-reduction program that has defined Teva's commercial posture since.
The Copaxone Era and the Patent Cliff
Copaxone (glatiramer acetate) was, for two decades, the central commercial asset of the modern Teva. By July 2015 it held 31.2% of total multiple-sclerosis prescriptions in the United States; the 40 mg three-times-weekly version Teva launched accounted for 68.5% of total Copaxone prescriptions. Copaxone alone accounted for approximately 50% of Teva's profit and 20% of revenue at peak.
The structural risk was always patent expiration. In January 2015 the United States Supreme Court ruled for Teva on the Copaxone patent in Teva v. Sandoz, but the broader patent cliff arrived in 2015–2017 as generic glatiramer acetate competitors entered the market. The revenue compression that followed was severe and contributed materially to the post-2017 share-price weakness.
The Pivot to Growth (2023–2027)
Richard Francis took over as CEO in January 2023 and announced the "Pivot to Growth" strategy that has framed Teva's commercial posture since. The targets are explicit: 30% operating margin and more than $2.7 billion in annual free cash flow by 2027, supported by cost savings from operational efficiencies and a refocus on the higher-margin branded-specialty portfolio.
The current branded portfolio is led by Austedo (deutetrabenazine, approved for chorea associated with Huntington's disease and for tardive dyskinesia) and Ajovy (fremanezumab, approved for preventive treatment of adult migraine). Both compounds are positioned to drive the branded revenue growth that anchors the 2027 financial targets. Copaxone, Bendeka, and Treanda remain in the portfolio but no longer drive the growth thesis.
The Litigation Overhang
Teva's post-2015 chapter has been defined commercially by the Copaxone cliff and operationally by sustained litigation exposure. The principal items:
- December 2016 — Twenty US state attorneys general filed a civil complaint accusing Teva of coordinated price-fixing on generic antibiotics and diabetes drugs. The complaint alleged informal gatherings, phone calls, and text messages between six pharmaceutical firms.
- May 2019 — Forty-four US states sued Teva and 18 other companies for price-fixing on generics, with allegations of price inflation of up to 1,000%.
- June 2021 — Teva agreed to pay $925 million to settle Mississippi price-fixing allegations.
- 2022–2024 — Multi-jurisdiction opioid litigation settlements covering Teva's historical sales of generic opioid products, totaling approximately $4.25 billion in aggregate value across the relevant jurisdictions.
- October 2024 — €462.6 million European Commission fine for patent-system misuse relating to Copaxone.
The litigation and regulatory load shaped balance-sheet discipline through the late 2010s and early 2020s and remains a recurring management focus.
Why Teva Matters in the Israeli Economy
Three structural reasons.
First, Teva is the foundational pillar of the Israeli pharmaceutical sector — the company that established the global credibility of Israeli pharmaceutical manufacturing, regulatory affairs, and clinical-trial capability. Compugen, Pluri, Kamada, BiolineRx, and the broader cohort of Israeli biotech operators developed inside an ecosystem that Teva's scale and longevity made possible.
Second, Teva is the principal Israeli industrial-pharmaceutical operator with active US, European, and emerging-market commercial presence. The branded portfolio (Austedo, Ajovy) competes directly against US, European, and Japanese pharmaceutical majors on the same regulatory, clinical, and commercial terms.
Third, Teva is the operational template for Israeli industrial scale. Eli Hurvitz's playbook — incremental international acquisition, defended generics-manufacturing scale, and selective branded specialty investment — became the operating reference case for the next generation of Israeli industrial founders.
FAQ
Who founded Teva Pharmaceutical Industries?
Teva's corporate lineage traces to May 1, 1901, in Ottoman-era Jerusalem, when Salomon, Levin and Elstein Ltd. was established as a small drug-distribution business. The modern Teva Pharmaceutical Industries Ltd. was formed in 1976 through the merger of Teva, Assia (founded 1935 in Petah Tikva by Salomon, Levin, and Elstein), and Zori. Eli Hurvitz, who had started at Assia in 1953, was named the merged company's first CEO and led it through the international-expansion era.
What is Copaxone?
Copaxone (glatiramer acetate) is Teva's flagship multiple-sclerosis treatment. The active compound — the COP-1 polymer — was developed at the Weizmann Institute by Professors Michael Sela, Ruth Arnon, and Dvora Teitelbaum across fifteen years of research. The FDA approved Copaxone in 1997; the EU followed in 2001. Copaxone was the world's best-selling multiple-sclerosis treatment at peak and accounted for approximately 50% of Teva's profit and 20% of revenue. The patent cliff arrived in 2015–2017 as generic glatiramer acetate competitors entered the market.
Is Teva still profitable?
Yes. Teva remains a profitable global pharmaceutical operator, though substantially smaller in revenue terms than the pre-2017 peak. The "Pivot to Growth" strategy announced by CEO Richard Francis in 2023 targets a 30% operating margin and more than $2.7 billion in annual free cash flow by 2027. The growth thesis is principally anchored by Austedo and Ajovy in the branded-specialty portfolio.
Who is Richard Francis?
Richard Francis is Teva's CEO, appointed in January 2023. He joined from Sandoz, where he was CEO from 2014 to 2019, leading the Novartis generics-and-biosimilars unit. At Teva, Francis launched the "Pivot to Growth" strategy and has overseen the focus on the branded-specialty portfolio and ongoing balance-sheet discipline.
Where is Teva headquartered?
Teva is headquartered in Petah Tikva, Israel. The company maintains manufacturing facilities across Israel, North America, Europe, Australia, and South America, and commercial operations in more than 60 countries.
Why did Teva's share price decline after 2015?
Three reasons compounded. First, the Copaxone patent cliff in 2015–2017 removed the largest single profit driver. Second, the 2016 Actavis acquisition for approximately $40 billion significantly overleveraged the balance sheet at exactly the moment the Copaxone revenue stream was compressing. Third, the multi-year price-fixing and opioid-litigation settlements imposed sustained legal and regulatory cost through 2017–2024. The "Pivot to Growth" strategy announced in 2023 is the operational response.
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