Cover Page
Cover Page - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Jun. 30, 2019 | |
Cover [Abstract] | ||
Document Type | 10-K | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2019 | |
Document Transition Report | false | |
Document Period End Date | Dec. 31, 2019 | |
Document Fiscal Period Focus | FY | |
Document Annual Report | true | |
Entity Registrant Name | TEVA PHARMACEUTICAL INDUSTRIES LTD | |
Entity Central Index Key | 0000818686 | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Common Stock, Shares Outstanding | 1,092,189,007 | |
Title of 12(b) Security | Ordinary Share | |
Trading Symbol | TEVA | |
Security Exchange Name | NYSE | |
Entity File Number | 001-16174 | |
Entity Incorporation, State or Country Code | IL | |
Entity Tax Identification Number | 00-0000000 | |
Entity Address, Address Line One | 5 Basel Street | |
Entity Address, City or Town | Petach Tikva | |
Entity Address, Postal Zip Code | 4951033 | |
Entity Address, Country | IL | |
City Area Code | +972 (3) | |
Local Phone Number | 914-8171 | |
Entity Filer Category | Large Accelerated Filer | |
Smaller Reporting Company | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | No | |
Entity Public Float | $ 8,820 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | |
Current assets: | |||
Cash and cash equivalents | $ 1,975 | $ 1,782 | |
Accounts receivables | 5,676 | 5,822 | |
Inventories | 4,422 | 4,731 | |
Prepaid expenses | 870 | 899 | |
Other current assets | 434 | 468 | |
Assets held for sale | 87 | 92 | |
Total current assets | 13,464 | 13,794 | |
Deferred income taxes | 386 | 368 | |
Other non-current assets | 591 | 731 | |
Property, plant and equipment, net | 6,436 | 6,868 | |
Operating lease right-of-use assets | 514 | ||
Identifiable intangible assets, net | 11,232 | 14,005 | |
Goodwill | [1] | 24,846 | 24,917 |
Total assets | 57,470 | 60,683 | |
Current liabilities: | |||
Short-term debt | 2,345 | 2,216 | |
Sales reserves and allowances | 6,159 | 6,711 | |
Accounts payables | 1,718 | 1,853 | |
Employee-related obligations | 693 | 870 | |
Accrued expenses | 1,869 | 1,868 | |
Other current liabilities | 889 | 804 | |
Total current liabilities | 13,674 | 14,322 | |
Long-term liabilities: | |||
Deferred income taxes | 1,096 | 2,140 | |
Other taxes and long-term liabilities | 2,640 | 1,727 | |
Senior notes and loans | 24,562 | 26,700 | |
Operating lease liabilities | 435 | ||
Total long-term liabilities | 28,733 | 30,567 | |
Commitments and contingencies, see note 12 | |||
Total liabilities | 42,407 | 44,889 | |
Teva shareholders' equity: | |||
Ordinary shares of NIS 0.10 par value per share; December 31, 2019 and December 31, 2018: authorized 2,495 million shares; issued 1,198 million shares and 1,196 million shares, respectively | 56 | 56 | |
Additional paid-in capital | 27,312 | 27,210 | |
Accumulated deficit | (6,956) | (5,958) | |
Accumulated other comprehensive loss | (2,312) | (2,459) | |
Treasury shares as of December 31, 2019 and December 31, 2018: 106 million ordinary shares | (4,128) | (4,142) | |
Stockholders' equity attributable to Teva shareholders | 13,972 | 14,707 | |
Non-controlling interests | 1,091 | 1,087 | |
Total equity | 15,063 | 15,794 | |
Total liabilities and equity | $ 57,470 | $ 60,683 | |
[1] | Accumulated goodwill impairment as of December 31, 2019, December 31, 2018 and January 1, 2018 was approximately $21.0 billion, $21.0 billion and $18.0 billion, respectively. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - ₪ / shares shares in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Common stock, par or stated value per share | ₪ 0.10 | ₪ 0.10 |
Ordinary shares, authorized | 2,495 | 2,495 |
Ordinary shares, issued | 1,198 | 1,196 |
Treasury shares | 106 | 106 |
Consolidated Statements of Inco
Consolidated Statements of Income (Loss) - USD ($) shares in Millions, $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Net revenues | $ 16,887 | $ 18,271 | $ 21,853 | |
Cost of sales | 9,351 | 9,975 | 11,237 | |
Gross profit | 7,537 | 8,296 | 10,615 | |
Research and development expenses | 1,010 | 1,213 | 1,778 | |
Selling and marketing expenses | 2,614 | 2,916 | 3,395 | |
General and administrative expenses | 1,192 | 1,298 | 1,451 | |
Intangible assets impairments | 1,639 | 1,991 | 3,238 | |
Goodwill impairment | 3,027 | [1] | 17,100 | |
Other asset impairments, restructuring and other items | 423 | 987 | 1,836 | |
Legal settlements and loss contingencies | 1,178 | (1,208) | 500 | |
Other income | (76) | (291) | (1,199) | |
Operating (loss) income | (443) | (1,637) | (17,484) | |
Financial expenses—net | 822 | 959 | 895 | |
Income (loss) before income taxes | (1,265) | (2,596) | (18,379) | |
Income taxes (benefit) | (278) | (195) | (1,933) | |
Share in (profits) losses of associated companies—net | 13 | 71 | 3 | |
Net income (loss) | (1,000) | (2,472) | (16,449) | |
Net loss attributable to non-controlling interests | (2) | (322) | (184) | |
Net income (loss) attributable to Teva | (999) | (2,150) | (16,265) | |
Accrued dividends on preferred shares | 249 | 260 | ||
Net income (loss) attributable to ordinary shareholders | $ (999) | $ (2,399) | $ (16,525) | |
Earnings (loss) per share attributable to ordinary shareholders: | ||||
Basic | $ (0.91) | $ (2.35) | $ (16.26) | |
Diluted | $ (0.91) | $ (2.35) | $ (16.26) | |
Weighted average number of shares (in millions): | ||||
Basic | 1,091 | 1,021 | 1,016 | |
Diluted | 1,091 | 1,021 | 1,016 | |
[1] | Goodwill impairment mainly attributable to the International Markets segment, Mexico and Medis. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Net income (loss) | $ (1,000) | $ (2,472) | $ (16,449) | |
Other comprehensive income (loss), net of tax: | ||||
Currency translation adjustment | [1] | 97 | (713) | 1,516 |
Unrealized gain (loss) on derivative financial instruments, net | 84 | 115 | (140) | |
Unrealized gain (loss) on available-for-sale securities, net | (1) | 3 | ||
Unrealized gain (loss) on defined benefit plans, net | (20) | 13 | (10) | |
Total other comprehensive income (loss) | 160 | (585) | 1,369 | |
Total comprehensive loss | (840) | (3,057) | (15,080) | |
Comprehensive income (loss) attributable to non-controlling interests | 12 | (296) | (121) | |
Comprehensive loss attributable to Teva | $ (852) | $ (2,761) | $ (14,959) | |
[1] | In 2017 includes amount that was released from accumulated other comprehensive loss as part of the deconsolidation of the Venezuelan subsidiaries and is included in Venezuela deconsolidation charge under other asset impairment, restructuring and other items. |
Consolidated Statements of Chan
Consolidated Statements of Changes in Equity - USD ($) shares in Millions, $ in Millions | Total | Ordinary Shares [Member] | MCPS [Member] | [1] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | AOCI Attributable to Parent [Member] | Treasury Shares [Member] | Total Teva Shareholders' Equity [Member] | Non-controlling Interests [Member] | ||||
Beginning balance at Dec. 31, 2016 | $ 34,993 | $ 54 | $ 3,620 | $ 23,409 | $ 13,607 | $ (3,159) | $ (4,194) | $ 33,337 | $ 1,656 | |||||
Beginning balance, shares at Dec. 31, 2016 | 1,123 | |||||||||||||
Comprehensive income (loss) | (15,080) | (16,265) | 1,306 | (14,959) | (121) | |||||||||
Exercise of options by employees and vested RSUs, value | [2] | [2] | (45) | 45 | [2] | |||||||||
Exercise of options by employees and vested RSUs, shares | 1 | |||||||||||||
Stock-based compensation expense | 133 | 133 | 133 | |||||||||||
Dividends to ordinary shareholders | (901) | (901) | (901) | |||||||||||
Dividends to preferred shareholders | (249) | 11 | (11) | (249) | (249) | |||||||||
Transactions with non-controlling interests | (111) | (111) | ||||||||||||
Other | (40) | (7) | 5 | (2) | (38) | |||||||||
Ending balance at Dec. 31, 2017 | 18,745 | $ 54 | 3,631 | 23,479 | (3,803) | (1,853) | (4,149) | 17,359 | 1,386 | |||||
Ending balance, shares at Dec. 31, 2017 | 1,124 | |||||||||||||
Cumulative effect of new accounting standard | [3] | (5) | 5 | |||||||||||
Comprehensive income (loss) | (3,057) | (2,150) | (611) | (2,761) | (296) | |||||||||
Issuance of shares, value | [4] | (52) | $ 2 | (3,880) | 3,826 | (52) | ||||||||
Issuance of shares, shares | [4] | 72 | ||||||||||||
Issuance of Treasury Shares | 4 | [2] | (3) | 7 | 4 | |||||||||
Stock-based compensation expense | 155 | 155 | 155 | |||||||||||
Dividends to preferred shareholders | $ 249 | (249) | ||||||||||||
Transactions with non-controlling interests | (1) | 2 | 2 | (3) | ||||||||||
Ending balance at Dec. 31, 2018 | 15,794 | $ 56 | 27,210 | (5,958) | (2,459) | (4,142) | 14,707 | 1,087 | ||||||
Ending balance, shares at Dec. 31, 2018 | 1,196 | |||||||||||||
Comprehensive income (loss) | (840) | (999) | 147 | (852) | 12 | |||||||||
Issuance of shares, value | [2] | |||||||||||||
Issuance of shares, shares | 2 | |||||||||||||
Issuance of Treasury Shares | 6 | [2] | (8) | 14 | 6 | |||||||||
Stock-based compensation expense | 119 | 119 | 119 | |||||||||||
Transactions with non-controlling interests | (8) | (8) | ||||||||||||
Other | (8) | (8) | (8) | |||||||||||
Ending balance at Dec. 31, 2019 | $ 15,063 | $ 56 | $ 27,312 | $ (6,956) | $ (2,312) | $ (4,128) | $ 13,972 | $ 1,091 | ||||||
Ending balance, shares at Dec. 31, 2019 | 1,198 | |||||||||||||
[1] | Mandatory convertible preferred shares. | |||||||||||||
[2] | Represents an amount less than 0.5 million. | |||||||||||||
[3] | Following the adoption of ASU 2016-01, the Company recorded a $ 5 million opening balance reclassification from accumulated other comprehensive income to retained earnings. | |||||||||||||
[4] | Mainly MCPS conversion |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Equity (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
AOCI Attributable to Parent [Member] | |||
Foreign currency translation attributable to non-controlling interests | $ 5 | ||
Maximum [Member] | Ordinary Shares [Member] | |||
Exercise of options by employees and vested RSUs | $ 0.5 | $ 0.5 | $ 0.5 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows $ in Millions | 12 Months Ended | |||||
Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | ||||
Operating activities: | ||||||
Net loss | $ (1,000) | $ (2,472) | $ (16,449) | |||
Adjustments to reconcile net loss to net cash provided by operations: | ||||||
Impairment of long-lived assets | 1,778 | 5,621 | 20,882 | |||
Depreciation and amortization | 1,722 | 1,842 | 2,112 | |||
Net change in operating assets and liabilities | (896) | (1,823) | (1,645) | |||
Deferred income taxes—net and uncertain tax positions | (985) | (837) | (2,331) | |||
Stock-based compensation | 119 | 155 | 133 | |||
Other items | 28 | (135) | 13 | |||
Research and development in process | 114 | 175 | ||||
Net loss from sale of long-lived assets and investments | (18) | (19) | (1,090) | |||
Venezuela deconsolidation loss | 383 | |||||
Venezuela impairment of net monetary assets | 42 | |||||
Net cash provided by operating activities | 748 | 2,446 | 2,225 | |||
Investing activities: | ||||||
Beneficial interest collected in exchange for securitized trade receivables | 1,487 | 1,735 | 1,282 | |||
Proceeds from sales of long-lived assets and investments | 343 | 890 | 3,477 | |||
Purchases of property, plant and equipment | (525) | (651) | (874) | |||
Purchases of investments and other assets | (8) | (119) | (200) | |||
Other investing activities | 58 | 11 | (282) | |||
Acquisitions of subsidiaries, net of cash acquired | 43 | |||||
Net cash provided by investing activities | 1,355 | 1,866 | 3,446 | |||
Financing activities: | ||||||
Repayment of senior notes and loans and other long-term liabilities | (3,944) | (7,446) | (3,300) | |||
Proceeds from senior notes and loans, net of issuance costs | 2,083 | 4,434 | 506 | |||
Net change in short-term debt | (2) | (260) | (1,683) | |||
Other financing activities | (11) | (57) | (74) | |||
Dividends paid on ordinary shares | (12) | [1] | (901) | [1] | ||
Dividends paid on preferred shares | (52) | [1] | (10) | [1] | (260) | [1] |
Dividends paid to non-controlling interests | (38) | |||||
Net cash provided by (used in) financing activities | (1,926) | (3,351) | (5,750) | |||
Translation adjustment on cash and cash equivalents | 16 | (142) | 54 | |||
Net change in cash and cash equivalents | 193 | 819 | (25) | |||
Balance of cash and cash equivalents at beginning of year | 1,782 | 963 | 988 | |||
Balance of cash and cash equivalents at end of year | 1,975 | 1,782 | 963 | |||
Non-cash financing and investing activities: | ||||||
Beneficial interest obtained in exchange for securitized trade receivables | 1,511 | 1,716 | 1,295 | |||
Conversion of mandatory convertible preferred shares into ordinary shares | 3,880 | |||||
Cash paid during the year for: | ||||||
Interest | 840 | 815 | 795 | |||
Income taxes, net of refunds | 552 | 420 | 106 | |||
Net change in operating assets and liabilities: | ||||||
Other current assets | (1,416) | (1,437) | 658 | |||
Trade payables, accrued expenses, employee-related obligations and other current liabilities | 643 | (500) | (3,083) | |||
Trade receivables net of sales reserves and allowances | (394) | 88 | 514 | |||
Inventories | 271 | 26 | 199 | |||
Inventory step-up | 67 | |||||
Net Change In Items Comprising Supplemental Disclosure Of Cash Flow Information | $ (896) | $ (1,823) | $ (1,645) | |||
[1] | In 2019 and 2018, the amounts consist of tax withholding payments made on shares and dividends. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Significant Accounting Policies | NOTE 1—Significant accounting policies: a. General: Operations Teva Pharmaceutical Industries Limited (the “Parent Company”), headquartered in Israel, together with its subsidiaries and associated companies (the “Company,” “Teva” or the “Group”), is engaged in the development, manufacturing, marketing and distribution of generics, specialty medicines and biopharmaceuticals. The majority of the Group’s revenues are in the United States and Europe. Basis of presentation and use of estimates The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). In preparing the Company’s consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reported years. Actual results could differ from those estimates. As applicable to these consolidated financial statements, the most significant estimates and assumptions relate to determining the valuation and recoverability of intangible assets and goodwill; assessing sales reserves and allowances, and contingent consideration; assessing compliance with debt covenants; uncertain tax positions, valuation allowances, contingencies, inventory valuation and restructuring. Accounting for Venezuelan Operations Until November 30, 2017, the financial position and results of operations of Teva’s Venezuelan business, conducted through a number of wholly-owned subsidiaries, were included in Teva’s consolidated financial statements and reported under highly-inflationary accounting principles, with the functional currency of the U.S. dollar. Effective November 30, 2017, Teva deconsolidated its Venezuelan subsidiaries and began accounting for its investments in its Venezuelan operations using the cost method of accounting under the measurement alternative. The estimated fair value of the investments was immaterial based on expected future cash flow, considering ongoing hyper-inflation and economic and political uncertainty in Venezuela. The assigned values are considered Level 3 measurements within the fair value hierarchy. Teva’s financial results include sales of finished goods to the Venezuelan subsidiaries, to the extent cash payments are received from these subsidiaries, while cost of sales is recorded when goods are imported to Venezuela. The Venezuelan subsidiaries’ results were immaterial in terms of assets, liabilities, operating results and cash flows for the eleven months ended November 30, 2017. Upon assessing the facts as of December 31, 2019, Teva continues to believe its previous conclusion regarding its lack of control or significant influence over its Venezuelan operations is appropriate. Teva will continue to monitor the conditions in Venezuela and their impact on its prospective accounting treatment and related disclosures. Functional currency A major part of the Group’s operations is carried out by the Company in the United States, Israel and certain other countries. The functional currency of these entities is the U.S. dollar (“dollar” or “$”). The functional currency of certain subsidiaries and associated companies is their local currency. The financial statements of those companies are included in the consolidated financial statements, translated into U.S. dollars. Assets and liabilities are translated at year-end In the event of a divestiture of a foreign subsidiary, the related foreign currency translation results are reversed from equity to income. Foreign currency exchange gains and losses are included in net income (loss). Principles of consolidation The consolidated financial statements include the accounts of the Company and its majority-owned subsidiaries and VIEs for which the Company is considered the primary beneficiary. For those consolidated subsidiaries where Teva owns less than 100%, the outside shareholders’ interests are shown as non-controlling For VIEs, the Company performs an analysis to determine whether the variable interests give a controlling financial interest in a VIE. The Company periodically reassesses whether it controls its VIEs. Intercompany transactions and balances are eliminated on consolidation; profits from intercompany sales, not yet realized outside the Group, are also eliminated. b. Revision of Previously Reported Consolidated Financial Statements In connection with the preparation of Teva’s consolidated financial statements for the fiscal year ended December 31, 2019, Teva determined that in the full years and interim periods of fiscal years 2017 and 2018, and the first three quarters of fiscal year 2019, it had an immaterial error in the presentation of distribution revenues from its Israeli distribution business. This business is part of the International Markets reporting segment and facilitates distribution of Teva and third party products to pharmacies, hospitals and other organizations in Israel. Specifically, the Company concluded that it presented revenue from its Israeli distribution business on a gross basis, although it should have reported such revenue on a net basis. Because Teva has no discretion in establishing prices for any specifies goods or services, limited inventory risk and is not primarily responsible for contract fulfillment, Teva does not meet the criteria for reporting revenues from such business as a principal (on a gross basis), as opposed to as an agent (on a net basis). The Company evaluated the cumulative impact of this item on its previously issued annual financial statements for 2017 and 2018, and the interim financial statements for 2017, 2018 and the first three quarters of 2019, and concluded that, for the reasons mentioned below, the revisions were not material, individually or in the aggregate, to any of its previously-issued interim or annual financial statements. Teva has revised its presentation of net revenue and cost of sales in the historical consolidated financial statements to reflect the change in this item, as described in more detail below. The impact of this revision is a decrease in net revenues with an offsetting decrease in cost of sales. There is no impact on gross profit, operating income or earnings per share. In addition, there is no impact on Teva’s balance sheet or statement of cash flows for the related periods. The following table summarizes the impact of the revision on net revenues and cost of sales in the consolidated statements of income in the relevant periods: Net revenues Cost of sales As reported Adjustment As revised As reported Adjustment As revised (U.S. $ in millions) 2017 22,385 (533 ) 21,853 11,770 (533 ) 11,237 2018 18,854 (583 ) 18,271 10,558 (583 ) 9,975 c. New accounting pronouncements Recently adopted accounting pronouncements In June 2018, the FASB issued ASU 2018-07 non-employee In August 2017, the FASB issued ASU 2017-12 non-financial In February 2016, the FASB issued ASU 2016-02 right-of-use Teva adopted the new lease standard and all the related amendments on January 1, 2019 and used the effective date as Teva’s date of initial application. Consequently, financial information was not updated and the disclosures required under the new standard are not provided for dates and periods before January 1, 2019. The new lease standard provides a number of optional practical expedients in transition. Teva did not elect the ‘package of practical expedients,’ which permits the Company not to reassess its prior conclusions regarding lease identification, lease classification and initial direct costs under the new standard. However, the Company did elect the practical expedient pertaining to the use of hindsight. The new lease standard also provides practical expedients for an entity’s ongoing accounting. Teva elected the short-term lease recognition exemption for all leases with a term shorter than 12 months. This means, for those leases, Teva does not recognize ROU assets or lease liabilities, including not recognizing ROU assets or lease liabilities for existing short-term leases of those assets in transition. Teva also elected the practical expedient to not separate lease and non-lease Additionally, following the adoption of the new lease standard and in subsequent measurements, Teva applies the portfolio approach to account for the operating lease ROU assets and liabilities for certain car leases and incremental borrowing rates. The adoption of this standard has a material effect on Teva’s financial statements. The most significant impact is reflected in: (i) effective as of January 1, 2019, the recognition of approximately $553 million ROU assets and $561 million lease liabilities on Teva’s balance sheet for its operating leases of real estate, vehicles and equipment (the difference between the additional lease assets and lease liabilities did not have material impact on the retained earnings), and (ii) the requirement to provide significant new disclosures regarding Teva’s leasing activities and to enable users of financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. However, the adoption of this standard does not have a significant impact on Teva’s consolidated statements of income and consolidated statements of cash flows. Also, the Company’s accounting for finance leases remained substantially unchanged. See note 8 and note 1 dd Recently issued accounting pronouncements, not yet adopted In December 2019, the FASB issued ASU 2019-12 year-to-date In addition, this Update also simplifies the accounting for income taxes in certain topics as follows: (1) requiring that an entity recognize a franchise tax (or similar tax) that is partially based on income as an income-based tax and account for any incremental amount incurred as a non-income-based In April 2019, the FASB issued ASU 2019-04 In November 2018, the FASB issued ASU 2018-18 unit-of-account after December 15, 2019. Early adoption is permitted and should be applied retrospectively. The adoption of this guidance will not have a significant impact on the Company’s consolidated financial statements. In August 2018, the FASB issued ASU 2018-15 other—Internal-use 350-40): internal-use In August 2018, the FASB issued ASU 2018-13 In June 2016, the FASB issued ASU 2016-13 d Acquisitions: Teva’s consolidated financial statements include the operations of acquired business es Contingent consideration incurred in a business combination is included as part of the acquisition price and recorded at a probability weighted assessment of its fair value as of the acquisition date. The fair value of the contingent consideration is re-measured e. Collaborative arrangements: Collaborative agreements are contractual arrangements in which the parties are active participants to the arrangement and are exposed to the significant risks and rewards that are dependent on the ultimate commercial success of the endeavor. The Company recognizes revenue generated and costs incurred on sales to third parties as it relates to collaborative agreements as gross or net. If the Company is the principal participant in a transaction, revenues and costs are recorded on a gross basis; otherwise, revenues are recorded on a net basis. f. Equity investments: The Company measures equity investments at fair value with changes in fair value recognized in net income. The Company accounts for equity investments that do not have a readily determinable fair value as cost method investments under the measurement alternative prescribed within ASU 2016-01 g. Fair value measurement: The Company measures fair value and discloses fair value measurements for financial assets and liabilities. Fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The accounting standard establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. Level 2: Observable inputs that are based on inputs not quoted on active markets, but corroborated by market data. Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible and considers counterparty credit risk in its assessment of fair value. h. Investment in debt securities: Investment in securities consists of debt securities classified as available-for-sale Unrealized gains of available for sale debt securities, net of taxes, are reflected in other comprehensive income. Unrealized losses considered to be temporary are reflected in other comprehensive income; unrealized losses that are considered to be other-than-temporary are charged to income as an impairment charge. Realized gains and losses for debt securities are included in financial expense, net. The Company considers available evidence in evaluating potential impairments of its investments, including the duration and extent to which fair value is less than cost. For debt securities, an other-than-temporary impairment has occurred if the Company does not expect to recover the entire amortized cost basis of the debt security. If the Company does not intend to sell the impaired debt security, and it is not more likely than not it will be required to sell the debt security before the recovery of its amortized cost basis, the amount of the other-than-temporary impairment recognized in earnings, recorded in financial expense, net, is limited to the portion attributed to credit loss. The remaining portion of the other-than-temporary impairment related to other factors is recognized in other comprehensive income. i. Cash and cash equivalents: All highly liquid investments, which include short-term bank deposits and money market instruments, that are not restricted as to withdrawal or use, and investment in short-term debentures, the period to maturity of which did not exceed three months at the time of investment, are considered to be cash equivalents. j. Accounts receivables: Accounts receivables are stated at their net realizable value. The allowance against gross accounts receivables reflects the best estimate of losses inherent in the receivables portfolio determined on the basis of historical experience, specific allowances for known troubled accounts and other currently available information. An allowance for doubtful debts is reflected in net accounts receivables. Accounts receivables are written off after all reasonable means to collect the full amount have been exhausted. k Concentration of credit risks: Most of Teva’s cash and cash equivalents (which, along with investment in securities, totaled $2,030 million at December 31, 201 9 The pharmaceutical industry, particularly in the United States, has been significantly affected by consolidation among managed care providers, large pharmacy chains, wholesaling organizations and other buyer groups. The U.S. market constituted approximately 47% of Teva’s consolidated revenues in 201 9 outside the U.S. l Inventories: Inventories are valued at the lower of cost or net realizable value. Cost of raw and packaging materials, purchased products, manufactured finished products, products in process and capitalized production costs are determined predominantly on a standard cost basis, approximating actual costs. Other methods which are utilized for determining the value of inventories are moving average, cost basis and the first in first out method. Teva regularly reviews its inventories for obsolescence and other impairment risks and reserves are established when necessary. Inventories acquired in a business combination are stepped-up m. Long-lived assets: Teva’s long-lived, non-current impairment indicators throughout the year. Impairment testing for goodwill and all indefinite - ved Goodwill Goodwill reflects the excess of the consideration transferred, including the fair value of any contingent consideration and any non-controlling The goodwill impairment test is performed according to the following principles: 1. An initial qualitative assessment may be performed to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount. 2. If the Company concludes it is more likely than not that the fair value of the reporting unit is less than its carrying mount, a quantitative fair value test is performed. An impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value is recognized. An interim goodwill impairment test may be required in advance of the annual impairment test if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. For example, a substantial decline in the Company’s market capitalization, unexpected adverse business conditions, economic factors and unanticipated competitive activities may indicate that an interim impairment test is required. In the event that the Company’s market capitalization declines below its book value, the Company considers the length and severity of the decline and the reason for the decline when assessing whether potential goodwill impairment exists. Identifiable intangible assets Identifiable intangible assets are comprised of definite life intangible assets and indefinite life intangible assets. Definite life intangible assets consist mainly of acquired product rights and other rights relating to products for which marketing approval was received from the U.S. Food and Drug Administration (“FDA”) or the equivalent agencies in other countries. These assets are amortized mainly using the straight-line method over their estimated period of useful life, or based on economic benefit models, if more appropriate, which is determined by identifying the period and manner in which substantially all of the cash flows are expected to be generated. Amortization of acquired developed products is recorded under cost of sales. Amortization of marketing and distribution rights is recorded under selling and marketing (“S&M”) expenses when separable. Indefinite life intangible assets are mainly comprised of IPR&D assets. Teva monitors these assets for items such as research and development milestones and progress to identify any triggering events. Teva determines the fair value of the asset annually or when triggering events are present, based on discounted cash flows and records an impairment loss if book value exceeds fair value. IPR&D acquired in a business combination is capitalized as an indefinite life intangible asset until the related research and development efforts are either completed or abandoned. In the reporting periods where they are treated as indefinite life intangible assets, they are not amortized but rather are monitored triggering events and tested for impairment. Upon completion of the related research and development efforts, management determines the useful life of the intangible assets and amortizes them accordingly. In case of abandonment or a reduction in the expected realizable value of the asset, the related research and development assets are impaired. Whenever impairment indicators are identified for definite life intangible assets, Teva reconsiders the asset’s estimated life, calculates the undiscounted value of the asset’s or asset group’s cash flows and compares such value against the asset’s or asset group’s carrying amount. If the carrying amount is greater, Teva records an impairment loss for the excess of book value over fair value based on the discounted cash flows. In determining the estimated fair value of identifiable intangible assets, Teva utilized a discounted cash flow model. The key assumptions within the model related to forecasting future revenue and operating income, an appropriate discount rate and an appropriate terminal value based on the nature of the long-lived asset. The Company’s updated forecasts of net cash flows for the impaired assets reflect, among others, the following: (i) for IPR&D assets, the impact of changes to the development programs, the projected development and regulatory timeframes and the risks associated with these assets; and (ii) for product rights, pricing and volume projections, as well as patent life and any significant changes to the competitive environment. Property, plant and equipment Property, plant and equipment are stated at cost, after deduction of the related investment grants, and depreciated using the straight-line method over the estimated useful life of the assets: buildings, mainly 40 years; machinery and equipment, mainly between 15 to 20 years; and other assets, between 5 to 10 years. For property, plant and equipment and l right-of-use Lease right-of-use See notes 1c, 1dd and 8 for further discussion. n. Contingencies: The Company is involved in various patent, product liability, commercial, government investigations, environmental claims and other legal proceedings that arise from time to time in the ordinary course of business. Except for income tax contingencies, contingent consideration, other contingent liabilities incurred or acquired in a business combination, Teva records accruals for these types of contingencies to the extent that Teva concludes their occurrence is probable and that the related liabilities are estimable. When accruing these costs, the Company will recognize an accrual in the amount within a range of loss that is the best estimate within the range. When no amount within the range is a better estimate than any other amount, the Company accrues for the minimum amount within the range. Teva records anticipated recoveries under existing insurance contracts that are probable of occurring at the gross amount that is expected to be collected. Legal costs are expensed as incurred. The Company recognizes gain contingencies when they are realized or when all related contingencies have been resolved. o. Treasury shares: Treasury shares are presented as a reduction of Teva shareholders’ equity and carried at their cost to Teva, under treasury shares. p Stock-based compensation: Teva recognizes stock based compensation for the estimated fair value of share-based awards, restricted share units (“RSUs”) and performance share units (“PSUs”). The compensation expense for PSUs is recognized only if it is probable that the performance condition will be achieved. Teva measures compensation expense for share-based awards based on estimated fair values on the date of grant using the Black-Scholes option-pricing model. This option pricing model requires estimates as to the option’s expected term and the price volatility of the underlying stock. Teva amortizes the value of share-based awards to expense over the vesting period on a straight-line basis. Teva measures compensation expense for the RSUs and PSUs based on the market value of the underlying stock at the date of grant, less an estimate of dividends that will not accrue to the RSU and PSU holders prior to vesting. q. Deferred income taxes: Deferred income taxes are determined utilizing the “asset and liability” method based on the estimated future tax effects of temporary differences between the financial accounting and tax basis of assets and liabilities under the applicable tax laws, and on tax rates anticipated to be in effect when the deferred income taxes are expected to be paid or realized. A valuation allowance is provided if, based upon the weight of available evidence, it is more likely than not that a portion of the deferred income tax assets will not be realized. In determining whether a valuation allowance is needed, Teva considers all available evidence, including historical information, long range forecast of future taxable income and evaluation of tax planning strategies. Amounts recorded for valuation allowance can result from a complex series of judgments about future events and can rely on estimates and assumptions. Deferred income tax liabilities and assets are classified as non-current. Deferred tax has not been provided on the following items: 1. Taxes that would apply in the event of disposal of investments in subsidiaries, as it is generally the Company’s intention to hold these investments, not to realize them. The determination of the amount of related unrecognized deferred tax liability is not practicable. 2. Amounts of tax-exempt r Uncertain tax positions: Teva recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefit recognized in the financial statements for a particular tax position is based on the largest benefit that is more likely than not to be realized. Teva regularly re-evaluates Provisions for uncertain tax positions, whereas Teva has net operating losses to offset additional income taxes that would result from the settlement of the tax position, are presented as a reduction of the deferred tax assets for such net operating loss. s. Derivatives and hedging: The Group carries out transactions involving derivative financial instruments (mainly forward exchange contracts, currency options, cross-currency swap contracts, interest rate swap contracts and treasury locks). The transactions are designed to hedge the Company’s currency and interest rate exposures. The Company does not enter into derivative transactions for trading purposes. Derivative instruments are recognized on the balance sheet at their fair value. For derivative instruments that are designated and qualify as a fair value hedge, the gain or loss on the derivative instrument as well as the offsetting gain or loss on the hedged item attributable to the hedged risk is recognized in financial expenses—net in the statements of income in the period that the changes in fair value occur. For derivative instruments that are designated and qualify as a cash-flow hedge, the gain or loss on the derivative instrument is reported as a component of other comprehensive income and reclassified into earnings in the same line item associated with the anticipated transaction in the same period or periods during which the hedged transaction affects earnings. For derivative instruments that are designated as net-investment expenses-net. For derivative instruments that qualify for hedge accounting, the cash flows associated with these derivatives are reported in the consolidated statements of cash flows consistently with the classification of the cash flows from the underlying hedged items that these derivatives are hedging. Derivative instruments that do not qualify for hedge accounting are recognized on the Balance Sheet at their fair value, with changes in the fair value recognized as a component of financial expenses—net in the statements of income. The cash flows associated with these derivatives are reflected as cash flows from operating activities in the consolidated statements of cash flows. t Revenue recognition: The Company’s revenue recognition accounting policy until December 31, 2017, prior to the adoption of the new revenue standard The Company recognizes revenues from product sales, including sales to distributors when persuasive evidence of an arrangement exists, delivery has occurred, the selling price is fixed or determinable and collectability is reasonably assured. This generally occurs when products are shipped and title and risk and rewards for the products are transferred to the customer. Revenues from product sales are recorded net of provisions for estimated chargebacks, rebates, returns, prompt pay discounts and other deductions, such as shelf stock adjustments, which can be reasonably estimated. When sales provisions are not considered reasonably estimable by Teva, the revenue is deferred to a future period when more information is available to evaluate the impact. Provisions for chargebacks, rebates including Medicaid and other governmental program discounts and other promotional items, such as shelf stock adjustments, are included in sales reserves and allowances (“SR&A”). These provisions are recognized concurrently with the sales of products. Prompt payment discounts are netted against trade receivables. Calculations for these deductions from sales are based on historical experience and the specific terms in the individual agreements. Chargebacks and rebates are the largest components of sales reserves and allowances. Provisions for chargebacks are determined using historical chargeback experience and expected chargeback levels and wholesaler sales information for products, which are compared to externally obtained distribution channel reports for reasonableness. Rebates are recognized based on contractual obligations in place at the time of sales with consideration given to relevant factors that may affect the payment as well as historical experience for estimated market activity. Shelf-stock adjustments are granted to customers based on the existing inventory of a customer following decreases in the invoice or contract price of the related product and are estimated based on expected market performance. Teva records a reserve for estimated sales returns by applying historical experience of customer returns to the amounts invoiced and the amount of returned products to be destroyed versus products that can be placed back in inventory for resale. Revenue resulting from the achievement of milestone events stipulated in agreements is recognized when the milestone is achieved. Milestones are based on the occurrence of a substantive element specified in the contract or as a measure of substantive progress toward completion under the contract Revenues from licensees, sales of licensed products and technology are recorded in accordance with the contract terms, when third-party sales can be reliably measured and collection of the funds is reasonably assured. Royalty revenue is recognized as a component of net revenues in accordance with the terms of their respective contractual agreements when collectability is reasonably assured and when revenue can be reasonably measured. The Company’s revenue recognition accounting policy from January 1, 2018, following the adoption of the new revenue standard On January 1, 2018, Teva adopted the new revenue standard to all contracts using the modified retrospective method. The cumulative initial effect of applying the new revenue standard was immaterial. A contract with a customer exists only when: the parties to the contract have approved it and are committed to perform their respective obligations, the Company can identify each party’s rights regarding the distinct goods or services to be transferred (“performance obligations”), the Company can determine the transaction price for the goods or services to be transferred, the contract has commercial substance and it is probable that the Company will collect the consideration to which it will be entitled in exchange for the goods or services that will be transferred to the customer. Revenues are recorded in the amount of consideration to which the Company expects to be entitled in exchange for performance obligations upon transfer of control to the customer, excluding amounts collected on behalf of other third parties and sales taxes. The amount of consideration to which Teva expects to be entitled varies as a result of rebates, chargebacks, returns and other sales reserves and allowances (“SR&A”) that the Company offers to its customers and their customers, as well as the occurrence or nonoccurrence of future events, including milestone events. A minimum amount of variable consideration is recorded by the Company concurrently with the satisfaction of performance obligations to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. Estimates of variable consideration are based on historical experience and the specific terms in the |
Certain transactions
Certain transactions | 12 Months Ended |
Dec. 31, 2019 | |
Certain transactions | NOTE 2—Certain transactions: a. Business acquisitions: Actavis Generics and Anda acquisitions On August 2, 2016, Teva consummated its acquisition of Allergan plc’s (“Allergan”) worldwide generic pharmaceuticals business (“Actavis Generics”). At closing, Teva transferred to Allergan consideration of approximately $33.4 billion in cash and approximately 100.3 million Teva shares. On October 3, 2016, Teva consummated the acquisition of Anda Inc. (“Anda”), a medicines distribution business in the United States, from Allergan, for cash consideration of $500 million. This transaction was related to the Actavis Generics acquisition and, as such, the purchase price accounting and related disclosures were treated on a combined basis. The final cash consideration for the Actavis Generics acquisition was subject to certain net working capital adjustments. On January 31, 2018, Teva and Allergan entered into a settlement agreement and mutual releases for which Allergan made a one-time Rimsa On March 3, 2016, Teva completed the acquisition of Representaciones e Investigaciones Médicas, S.A. de C.V. (“Rimsa”), a pharmaceutical manufacturing and distribution company in Mexico, for $2.3 billion, in a cash free, debt free set of transactions. Teva financed the transaction using cash on hand. Following the closing of the acquisition, Teva identified issues concerning Rimsa’s pre-acquisition two pre-emptive On February 15, 2018, Teva and the Rimsa sellers entered into a settlement agreement and mutual releases with respect to Teva’s breach of contract claim, pursuant to which the Rimsa sellers made a one-time . b. Assets and Liabilities Held For Sale: The table below summarizes the major classes of assets included as held for sale as of December 31, 2019 and 2018: December 31, December 31, (U.S. $ in millions) Property, plant and equipment, net 98 92 Goodwill — 51 Adjustments of assets held for sale to fair value (11 ) (51 ) Total assets of the disposal group classified as held for sale in the consolidated balance sheets $ 87 $ 92 c. Other significant agreements: The Company has entered into alliances and other arrangements with third parties to acquire rights to products it does not have, to access markets it does not operate in and to otherwise share development costs or business risks. The Company’s most significant agreements of this nature are summarized below. Eli Lilly and Alder BioPharmaceuticals In December 2018, Teva entered into an agreement with Eli Lilly, resolving the European Patent Office opposition they had filed against Teva’s AJOVY ® On January 8, 2018, Teva signed a global license agreement with Alder BioPharmaceuticals (“Alder”). The agreement validates Teva’s IP and resolves Alder’s opposition to Teva’s European patent with respect to anti-calcitonin gene-related peptide (CGRP) antibodies, including the withdrawal of Alder’s appeal before the European Patent Office. Under the terms of the agreement, Alder will receive a non-exclusive PGT Healthcare Partnership In July 2018, Teva terminated its joint venture with the Procter & Gamble Company (“P&G”), PGT Healthcare partnership (“PGT”), which the two companies established in 2011 to market OTC medicines. Teva will continue to maintain its OTC business on an independent basis. As part of the separation, Teva transferred to P&G the shares it held in New Chapter Inc. and ownership rights in an OTC plant located in India. Teva provides certain services to P&G after the separation for a transition period. During the first quarter of 2018, Teva classified the plant in India as an asset held for sale and recorded an impairment of $64 million under other assets impairments, restructuring and other items. In addition, Teva recorded a write-down of $94 million of its investment in New Chapter Inc. under share in losses of associated companies. During September 2018, Teva and P&G completed the final net asset distribution as part of the dissolution and Teva recorded a gain of $50 million to reflect the cash payment received from P&G under the dissolution agreement. AUSTEDO ® On September, 19, 2017, Teva entered into a partnership agreement with Nuvelution Pharma, Inc. (“Nuvelution”) for development of AUSTEDO for the treatment of Tourette syndrome in pediatric patients in the United States. Nuvelution is funding and managing clinical development, driving all operational aspects of the phase 3 program, and Teva is leading the regulatory process and is responsible for commercialization. If FDA approval is obtained for AUSTEDO for the treatment of Tourette syndrome, Teva will pay Nuvelution a pre-agreed Otsuka On May 12, 2017, Teva entered into a license and collaboration agreement with Otsuka Pharmaceutical Co. Ltd. (“Otsuka”), providing Otsuka with an exclusive license to conduct phase 2 and 3 clinical trials for AJOVY in Japan and, if approved, to commercialize the product in Japan. Otsuka paid Teva an upfront payment of $50 million in consideration for the transaction. Teva may receive additional milestone payments upon filing with Japanese regulatory authorities, receipt of regulatory approval and achievement of certain revenue targets. Otsuka will also pay Teva royalties on AJOVY sales in Japan. Attenukine TM In December 2016, Teva entered into a license agreement for research, development, manufacture and commercializing of Attenukine technology with a subsidiary of Takeda Pharmaceutical Company Ltd. (“Takeda”). Teva received a $30 million upfront payment. A milestone payment of $20 million was received in 2017. The agreement stipulates additional milestone payments to Teva of up to $260 million, as well as future royalties. Ninlaro ® In November 2016, Teva entered into an agreement to sell its royalties and other rights in Ninlaro (ixazomib) to a subsidiary of Takeda, for a $150 million upfront payment to Teva and an additional $150 million payment based on sales during 2017. Teva was entitled to these royalties pursuant to an agreement from 2014 assigning the Ninlaro patents to an affiliate of Takeda in consideration of milestone payments and sales royalties. In the first six months of 2017, Teva received payments in the amount of $150 million, which were recognized as revenue for the period. Celltrion In October 2016, Teva and Celltrion, Inc. (“Celltrion”) entered into a collaborative agreement to commercialize TRUXIMA ® ® Teva and Celltrion will share the profit from the commercialization of these products. Teva launched TRUXIMA in the United States in November 2019. HERZUMA is expected to be available in the United States in the first quarter of 2020. Regeneron In September 2016, Teva and Regeneron Pharmaceuticals, Inc. (“Regeneron”) entered into a collaborative agreement to develop and commercialize Regeneron’s pain medication product, fasinumab. Teva and Regeneron share equally in the global commercial rights to this product, as well as ongoing associated R&D costs of approximately $1 billion. Teva made an upfront payment of $250 million to Regeneron in the third quarter of 2016 as part of the agreement. Milestone payments of $25 million, $35 million and $60 million were paid in the second quarter of 2017, the first quarter of 2018 and the fourth quarter of 2018, respectively. |
Revenue from contracts with cus
Revenue from contracts with customers | 12 Months Ended |
Dec. 31, 2019 | |
Revenue from contracts with customers | NOTE 3—Revenue from contracts with customers: On January 1, 2018, Teva adopted the new revenue standard to all contracts using the modified retrospective method. The cumulative initial effect of applying the new revenue standard was immaterial. Revenue recognition prior to and following the adoption of the new revenue standard See note 1 for a summary of the significant accounting policies. Disaggregation of revenue The following table disaggregates Teva’s revenues by major revenue streams. For additional information on disaggregation of revenues, see note 19. Year ended December 31, 201 9 North Europe International Other Total (U.S. Sale of goods 6,941 4,770 2,045 754 14,510 Licensing arrangements 109 29 4 5 147 Distribution 1,492 2 20 — 1,514 Other § (6 ) 177 545 716 $ 8,542 $ 4,795 $ 2,246 $ 1,304 $ 16,887 Year ended December 31, 201 8 North Europe International Other Total (U.S. Sale of goods 7,838 5,153 2,151 739 15,881 Licensing arrangements 111 23 22 9 165 Distribution 1,347 7 19 — 1,373 Other 1 3 230 618 852 $ 9,297 $ 5,186 $ 2,422 $ 1,366 $ 18,271 Year ended December 31, 201 7 North Europe International Other Total (U.S. Sale of goods 10,706 5,244 2,558 748 19,256 Licensing arrangements 281 3 38 5 327 Distribution 1,153 214 17 — 1,384 Other 1 5 250 630 886 $ 12,141 $ 5,466 $ 2,863 $ 1,383 $ 21,853 § Represents an amount less than $1 million . The financial data presented in the tables above with respect to prior periods have been revised to reflect a revision in the presentation of net revenues and cost of sales in the consolidated financial statements. See note 1b. Variable consideration Variable consideration mainly includes SR&A, comprised of rebates (including Medicaid and other governmental program discounts), chargebacks, returns and other promotional (including shelf stock adjustments) items. Provisions for prompt payment discounts are netted against trade receivables. The Company recognizes these provisions at the time of sale and adjusts them if the actual amounts differ from the estimated provisions. For description of the nature of each deduction and how provisions are estimated see n ote SR&A to U.S. customers comprised approximately 83% of the Company’s total SR&A as of December 31, 2019, with the remaining balance primarily in Canada and Germany. The changes in SR&A for third-party sales for the period ended December 31, 2018 and 2019 were as follows: Sales Reserves and Allowances Reserves Rebates Medicaid and Chargebacks Returns Other Total Total (U.S. $ in millions) Balance at January 1, 2018 $ 196 $ 3,077 $ 1,908 $ 1,849 $ 780 $ 267 $ 7,881 $ 8,077 Provisions related to sales made in current year period 514 6,572 1,284 10,206 442 417 18,899 $ 19,413 Provisions related to sales made in prior 3 (14 ) 24 — 28 (30 ) (62 ) $ (59 ) Credits and payments (538 ) (6,596 ) (1,850 ) (10,519 ) (606 ) (463 ) (19,942 ) $ (20,480 ) Translation differences — (33 ) (5 ) (6 ) (6 ) (15 ) (65 ) $ (65 ) Balance at December 31, 2018 $ 175 $ 3,006 $ 1,361 $ 1,530 $ 638 $ 176 $ 6,711 $ 6,886 Provisions related to sales made in current year 383 5,552 976 9,565 281 394 16,767 $ 17,150 Provisions related to sales made in prior — (92 ) (151 ) (17 ) 77 (6 ) (189 ) $ (189 ) Credits and payments (471 ) (5,570 ) (1,076 ) (9,736 ) (360 ) (392 ) (17,134 ) $ (17,605 ) Translation differences — (1 ) (1 ) 1 1 4 4 $ 4 Balance at December 31, 201 9 $ 87 $ 2,895 $ 1,109 $ 1,342 $ 637 $ 176 $ 6,159 $ 6,246 |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2019 | |
Inventories | NOTE 4 Inventories, net of reserves, consisted of the following: December 31, 2019 2018 (U.S. $ in millions) Finished products $ 2,504 $ 2,665 Raw and packaging materials 1,183 1,328 Products in process 583 590 Materials in transit and payments on account 151 148 $ 4,422 $ 4,731 |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment | NOTE 5—Property, plant and equipment: Property, plant and equipment, net, consisted of the following: December 31, 2019 2018 (U.S. $ in millions) Machinery and equipment $ 5,385 $ 5,658 Buildings 2,839 3,133 Computer equipment and other assets 2,131 2,089 Assets under construction and payments on account 672 565 Land 323 351 11,350 11,796 Less—accumulated depreciation (4,914 ) (4,928 ) $ 6,436 $ 6,868 Depreciation expenses were $609 million, $676 million and $632 million in the years ended December 31, 2019, 2018 and 2017, respectively. During the years ended December 31, 2019, 2018 and 2017 , $139 million, $500 million and $544 million, respectively. See note 15. |
Identifiable Intangible Assets
Identifiable Intangible Assets | 12 Months Ended |
Dec. 31, 2019 | |
Identifiable Intangible Assets | NOTE 6—Identifiable intangible assets: Identifiable intangible assets consisted of the following: Gross carrying amount Accumulated Net carrying amount December 31, 2019 2018 2019 2018 2019 2018 (U.S. $ in millions) Product rights $ 19,663 $ 20,361 $ 10,640 $ 9,565 $ 9,023 $ 10,796 Trade names 600 606 126 91 474 515 In-process 1,735 2,694 — — 1,735 2,694 Total $ 21,998 $ 23,661 $ 10,766 $ 9,656 $ 11,232 $ 14,005 Product rights and trade names Product rights and trade names are assets presented at amortized cost. Product rights and trade names represent a portfolio of pharmaceutical products from various categories with a weighted average life of approximately 12 years. Amortization of intangible assets amounted to $1,113 million, $1,166 million and $1,444 million in the years ended December 31, 2019, 2018 and 2017, respectively. As of December 31, 2019, the estimated aggregate amortization of intangible assets for the years 2020 to 2024 is as follows: 2020—$1,019 million; 2021—$856 million; 2022—$794 million; 2023—$790 million and 2024—$773 million. These estimates do not include the impact of IPR&D that is expected to be successfully completed and reclassified to product rights. IPR&D Teva’s IPR&D are assets that have not yet been approved in major markets. Teva’s IPR&D is comprised mainly of the following acquisitions and related assets: various generic products (Actavis Generics)—$1,453 million; various generic products (Rimsa)—$48 million and A USTEDO In 2019, Teva reclassified $291 million of products from IPR&D to product rights following regulatory approval, of which $174 million were reclassified in connection with methylphenidate ER. Intangible assets impairment Impairment of identifiable intangible assets amounted to $1,639 million, $1,991 million and $3,238 million in the years ended December 31, 2019, 2018 and 2017, respectively . These amounts are recorded in earnings under intangible assets impairment. Impairments in 2019 mainly consisted of: 1. Identifiable product rights of $ 958 mainly related to: (i) 647 million due to updated market assumptions regarding price and volume of certain , 128 million related to a in Japan as a result of , and (iii) $123 million related to the certain Generics . 2. IPR&D assets of $681 million, related to: (i) $497 million related to various generic pipeline products acquired from Actavis Generics , , (ii) $125 million related to lenalidomide (generic equivalent of REVLIMID ® ) , , (iii) $59 million related to a change in assumptions concerning the future European market share of a number of pipeline products acquired from Actavis Generics. |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill | NOTE 7—Goodwill: The changes in the carrying amount of goodwill for the years ended December 31, 2019 and 2018 were as follows : North Europe International Other Total (U.S. $ in millions) Balance as of January 1, 201 8 11,144 9,001 5,404 2,865 28,414 Changes during the year: Goodwill impairment — — (2,834 ) (193 ) (3,027 ) Goodwill disposal (3) — (65 ) (14 ) — (79 ) Goodwill reclassified as assets to held for sale — (3 ) — (17 ) (20 ) Translation differences and Other (46 ) (280 ) (77 ) 32 (371 ) Balance as of December 31, 201 8 $ 11,098 $ 8,653 $ 2,479 $ 2,687 $ 24,917 Changes during the year: Goodwill disposal (23 ) (5 ) — — (28 ) Translation differences and Other 16 (112 ) 53 — (43 ) Balance as of December 31, 201 9 $ 11,091 $ 8,536 $ 2,532 $ 2,687 $ 24,846 (1) Accumulated goodwill impairment as of December 31, 2019, December 31, 2018 and January 1, 2018 was approximately b (2) Goodwill impairment mainly attributable to the International Markets segment ( 3 Mainly due to the divestment of the women’s health business, the sale of Actavis Brazil and other activities. Teva operates its business through three segments: North America, Europe and International Markets. Teva began reporting its financial results under this structure in the first quarter of 2018. Each of these business segments is a reporting unit. Additional reporting units include the Teva’s production and sale of APIs to third parties (“Teva API”) and an out-licensing 1 9 Teva determines the fair value of its reporting units using the income approach. The income approach is a forward-looking approach for estimating fair value. Within the income approach, the method used is the discounted cash flow method. Teva starts with a forecast of all the expected net cash flows associated with the reporting unit, which includes the application of a terminal value, and then applies a discount rate to arrive at a net present value amount. Cash flow projections are based on Teva’s estimates of revenue growth rates and operating margins, taking into consideration industry and market conditions. The discount rate used is based on the weighted average cost of capital (“WACC”), adjusted for the relevant risk associated with country-specific and business-specific characteristics. If any of these expectations were to vary materially from Teva’s assumptions, Teva may record an impairment of goodwill allocated to these reporting units in the future. During the first quarter of 2019, management assessed developments that occurred in the quarter and concluded that it was not more likely than not that the fair value of any of its reporting units was below their carrying amount as of March 31, 2019 and, therefore, no quantitative assessments were performed. In the second quarter of 2019, Teva completed its long-range planning (“LRP”) process, which is part of Teva’s internal financial planning and budgeting process, and includes discussion and review by Teva’s management and board of directors. Certain events and changes in circumstances reflected in the LRP indicated that it was more likely than not that the carrying amount of the North America and International Markets reporting units may exceed their fair value. Consequently, management conducted a quantitative analysis for these reporting units, which resulted in no impairment charge. Teva determined that it was not more likely than not that the fair value of its remaining reporting units was less than their carrying amount. In connection with its goodwill impairment test during the second quarter of 2019 related thereto. During the third quarter of 2019, management assessed developments that occurred in the quarter and concluded that it was not more likely than not that the fair value of any of its reporting units was below their carrying amount as of September 30, 2019 and, therefore, no quantitative assessments were performed. Pursuant to Company policy, Teva conducted the annual goodwill impairment test for all reporting units during the fourth quarter of 2019. Management considered all information available, including information gathered from the 2020 Annual Operating Plan (“AOP”), and how it would affect the LRP prepared in the second quarter of 2019. Teva conducted its annual impairment test with the assistance of an independent valuation expert. North America During 2019, management noted a decrease in the fair value of the North America reporting unit, mainly due to lower projections for sales of AJOVY and due to changes to certain discount rate parameters and the selected Terminal Growth Rate (“TGR”), partially offset by net increase of projections of other products. The estimated fair value exceeds its carrying amount for the North America reporting unit by 26%. The Company used a terminal growth rate of 1.61% and a discount rate of 10.22%. If Teva holds all other assumptions constant, a reduction in the terminal growth rate of to 1.11% , to 10.72% , a reduction of the excess of fair value over carrying amount with respect to Teva’s North America reporting unit to 21% and 18%, respectively . Europe During 2019, management noted a decrease in the fair value of the Europe reporting unit, mainly due to projected currency translation effect. The estimated fair value exceeds the estimated carrying amount for the Europe reporting unit by 12%. The Company used a terminal growth rate of 1.36% and a discount rate of 9.52%. If Teva holds all other assumptions constant, a reduction in the terminal growth rate of 0.50% to 0.86% to 10.02% , a reduction of the excess of fair value over carrying amount with respect to Teva’s Europe reporting unit to 8% and 6%, respectively . International Markets During 2019, management noted an increase in the fair value of the International Markets reporting unit mainly due to higher projections of certain products and changes to certain discount rate parameters and the selected TGR, partially offset by decrease in the profitability projections in the Japanese market related to new price regulation and further generic competition. The estimated fair value exceeds the estimated carrying amount for the International Markets reporting unit by 16%. The Company used a terminal growth rate of 2.03% and a discount rate of 9.80%. If Teva holds all other assumptions constant, a reduction in the terminal growth rate of 0.50% to 1.53% to 10.3% , a reduction of the excess of fair value over carrying amount with respect to Teva’s International Markets reporting unit to 11% and 9%, respectively . Remaining reporting units The percentage difference between estimated fair value and estimated carrying amount for the Medis and Teva API reporting units is 72% and 23%, respectively. Market Capitalization Teva analyzed the aggregate fair value of its reporting units compared to its market capitalization as part of its annual goodwill impairment test, in order to assess the reasonableness of the results of its cash flow projections used for its goodwill impairment analysis. Teva noted its market capitalization was below management’s assessment of the aggregate fair value of the Company’s reporting units. However, as of December 31, 2019, the Company’s market capitalization plus a reasonable control premium exceeded its book value. In further consideration of the market capitalization analysis at year end, management analyzed the differences and the underlying factors addressed during the Company’s second quarter market reconciliation analysis and noted the following changes: • In the second quarter of 2019, management noted a difference with regard to sales projections of AJOVY and AUSTEDO in the International Markets reporting unit. Management continues to believe that the majority of analysts do not focus on this market in preparing their financial models and, as a result, have not attributed value to the launch potential in this reporting unit. Accordingly, management’s projections exceed those it believes are being used by analysts, particularly in International Markets. However, if management were to conform to analyst expectations, the International Markets reporting unit’s fair value would approximate its book value. Future impairment charges, if any, reflecting conditions at that time may be materially different. • In the second quarter of 2019, management also noted a difference with regard to sales projections of AUSTEDO in the North America reporting unit, resulting in higher fair value as analyzed by management compared to Teva’s market capitalization. Management continues to believe that it has more accurate information based on its knowledge of the market and its growth and therefore no adjustment was incorporated to the fair value. However, even if management was to reduce its AUSTEDO projections to those it believes are being used by analysts, the estimated fair value of the North America reporting unit would still exceed its carrying amount. • Management continues to believe market concerns regarding the volatility and uncertainty of certain litigation risks, namely from the opioid and price fixing litigations, are impacting its market capitalization. Management believes that these concerns led to an acute reaction, which resulted in a decline in Teva’s share price in the second quarter of 2019, and will continue to impact the Company’s stock price into 2020. However, developments in these cases are expected to clarify the outlook with regards to the opioid litigation, assuming the proposed settlement framework is finalized in 2020. Based upon Teva’s current estimates of fair value, even if management was to adjust the fair value of the North America reporting unit for this uncertainty, the estimated fair value would still exceed its carrying amount. If management were to conform to the market’s expectations in the North America reporting unit in connection with both AUSTEDO projections and the volatility and uncertainty of certain litigation risks, the Company would record a goodwill impairment charge of $1,230 million. Future impairment charges, if any, reflecting conditions at that time may be materially different. Management will continue to monitor business conditions and potential events or circumstances that could have a negative effect on the estimated fair value of the Company. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases | NOTE 8—Leases: Teva adopted the new accounting standard ASC 842 “Leases” and all related amendments on January 1, 2019 and used the effective date as Teva’s date of initial application. The components of operating lease cost for the year ended December 31, 2019 were as follows: Year ended (U.S. $ in millions) Operating lease cost: Fixed payments and variable payments that depend on an index or rate $ 166 Variable lease payments not included in the lease liability 6 Short-term lease cost 6 Total operating lease cost $ 178 Supplemental cash flow information related to operating leases was as follows: Year ended (U.S. $ in millions) Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 169 Right-of-use (non-cash): Operating leases $ 142 Supplemental balance sheet information related to operating leases was as follows: December 31, 2019 (U.S. $ in millions) Operating leases: Operating lease ROU assets $ 514 Other current liabilities 118 Operating lease liabilities 435 Total operating lease liabilities $ 553 December 31, 2019 Weighted average remaining lease term Operating leases 7.5 years Weighted average discount rate Operating leases 6.0 % Maturities of operating lease liabilities were as follows: December 31, 2019 (U.S. $ in millions) 2020 $ 146 2021 117 2022 92 2023 66 2024 and thereafter 298 Total operating lease payments $ 719 Less: imputed interest 166 Present value of lease liabilities $ 553 December 31, 2018 (U.S. $ in millions) According to ASC 840: 2019 $ 193 2020 154 2021 118 2022 91 2023 66 2024 and thereafter 283 Total lease payments $ 905 As of December 31, 2019, Teva has additional operating leases for office space which have yet to commence, with undiscounted future payments of $92 million. These operating leases will commence during fiscal year 2020 with lease terms of 9 to 12 years. On October 10, 2019, Teva entered into an agreement to sell and lease back the land and building of its distribution center in Israel. Net proceeds from the asset sale amounted to $128 million. As of December 31, 2019, Teva’s total finance lease assets and finance lease liabilities were |
Debt obligations
Debt obligations | 12 Months Ended |
Dec. 31, 2019 | |
Debt obligations | NOTE 9—Debt obligations: a. Short-term debt: December 31, Weighted average 9 Maturity 2019 2018 (U.S. $ in millions) Bank and financial institutions — — — 2 Convertible debentures 0.25 % 2026 514 514 Current maturities of long-term liabilities 1,831 1,700 Total short term debt $ 2,345 $ 2,216 Convertible senior debentures Teva 0.25% convertible senior debentures, due 2026, principal amount as of December 31, 2019 and 2018 were $514 million. These convertible senior debentures include a “net share settlement” feature according to which the principal amount will be paid in cash and in case of conversion, only the residual conversion value above the principal amount will be paid in Teva shares. Due to the “net share settlement” feature, exercisable at any time, these convertible senior debentures are classified in the B S Long-term debt: Weighted average 9 Maturity December 31, December 31, % (U.S. $ in millions) Senior notes EUR 1,010 million (2) 0.38 % 2020 $ 1,131 $ 1,897 Senior notes EUR 1,500 million 1.13 % 2024 1,673 1,707 Senior notes EUR 1,300 million 1.25 % 2023 1,451 1,480 Senior notes EUR 900 million 4.50 % 2025 1,008 1,029 Senior notes EUR 750 million 1.63 % 2028 833 850 Senior notes EUR 700 million 3.25 % 2022 784 801 Senior notes EUR 700 million 1.88 % 2027 782 798 Senior notes EUR 1,000 6.00 % 2025 1,120 — Senior notes USD 1,000 7.13 % 2025 1,000 — Senior notes USD 3,500 million 3.15 % 2026 3,494 3,493 Senior notes USD 1,475 million (3) 2.20 % 2021 1,474 2,997 Senior notes USD 3,000 million 2.80 % 2023 2,995 2,993 Senior notes USD 1,556 million (1) 1.70 % 2019 — 1,700 Senior notes USD 2,000 million 4.10 % 2046 1,985 1,985 Senior notes USD 1,250 million 6.00 % 2024 1,250 1,250 Senior notes USD 1,250 million 6.75 % 2028 1,250 1,250 Senior notes USD 844 million 2.95 % 2022 856 860 Senior notes USD 789 million 6.15 % 2036 782 782 Senior notes USD 700 million 2.25 % 2020 700 700 Senior notes USD 613 million 3.65 % 2021 618 621 Senior notes USD 588 million 3.65 % 2021 587 587 Senior notes CHF 350 million 0.50 % 2022 361 356 Senior notes CHF 350 million 1.00 % 2025 362 356 Fair value hedge accounting adjustments — (9 ) Total senior notes 26,496 28,483 Other long-term debt 1.13 % 2026 1 12 Less current maturities (1,831 ) (1,700 ) Derivative instruments — 9 Less debt issuance costs (103 ) (104 ) Total senior notes and loans $ 24,562 $ 26,700 (1) During the first six months of 2019, Teva repurchased and canceled approximately $144 million principal amount of its $1,700 million 1.7% senior notes due in July 2019. In July 2019, Teva repaid at maturity $1,556 million of its 1.7% senior notes. (2) In December (3) In November 2019, Teva consummated a cash tender offer for its $3,000 million 2.2% senior notes due in July 2021. As a result of the offer, Teva redeemed $1,525 million aggregate principal amount of this senior note. (4) In November 2019, Teva Pharmaceutical Finance Netherlands II B.V, a Teva finance subsidiary, issued senior notes in an aggregate principal amount of 1,000 million Euro bearing 6.0% annual interest and due January 2025. (5) In November 2019, Teva Pharmaceutical Finance Netherlands III B.V, a Teva finance subsidiary, issued senior notes in an aggregate principal amount of $1,000 million bearing 7.125% annual interest and due January 2025 Long term debt was issued by several indirect wholly-owned subsidiaries of the Company and is fully and unconditionally guaranteed by the Company as to payment of all principal, interest, discount and additional amounts (as defined), if any. Long term debt as of December 31, 2019 is effectively denominated (taking into consideration cross currency swap agreements) in the following currencies: U.S. dollar 66%, euro 31% and Swiss franc 3%. Teva’s principal sources of short-term liquidity are its cash on hand, existing cash investments, liquid securities and available credit facilities, primarily its $2.3 billion revolving credit facility (“RCF”). In April 2019, the Company entered into a $2.3 billion unsecured syndicated RCF, which replaced the previous $3 billion revolving credit facility. The RCF contains certain covenants, including certain limitations on incurring liens and indebtedness and maintenance of certain financial ratios, including the requirement to maintain compliance with a net debt to EBITDA ratio, which becomes more restrictive over time. The net debt to EBITDA ratio limit was 6.25x through December 31, 2019, gradually declines to 5.75x in the third and fourth quarters of 2020, and continues to gradually decline over the remaining term of the RCF. The RCF can be used for general corporate purposes, including repaying existing debt. Annual Report 10- K were Under specified circumstances, including non-compliance Teva expects that it will continue to have sufficient cash resources to support its debt service payments and all other financial obligations within one year from the date that these financial statements are issued. As of December 31, 2019, the required annual principal payments of long-term debt, excluding debt issuance cost , including convertible senior debentures, starting from December 31, (U.S. $ in millions) 2021 $ 2,679 2022 2,002 2023 4,446 2024 2,923 2025 and thereafter 13,131 $ 25,181 |
Derivative instruments and hedg
Derivative instruments and hedging activities | 12 Months Ended |
Dec. 31, 2019 | |
Derivative Instruments and Hedging Activities | NOTE 10—Derivative instruments and hedging activities: a. Foreign exchange risk management: In 2019, approximately 48% of Teva’s revenues were denominated in currencies other than the U.S. dollar. As a result, Teva is subject to significant foreign currency risks. The Company enters into forward exchange contracts, purchases and writes options in order to hedge the currency exposure on balance sheet items and operating activities. In addition, the Company takes measures to reduce exposure by using natural hedging. The Company also acts to offset risks in opposite directions among the companies in the Group. The currency hedged items are usually denominated in the following main currencies: the British pound (GBP), the euro (EUR), the Swiss franc (CHF), the Japanese yen (JPY), the Polish zloty (PLN), the new Israeli shekel (NIS), the Russian ruble (RUB), Canadian dollar (CAD), the Mexican peso (MXN), the Indian rupee (INR) and other European and Latin American currencies. Depending on market conditions, foreign currency risk is The Company hedges against possible fluctuations in foreign subsidiaries net assets (“net investment hedge”) and entered into cross currency swaps and forward contracts in order to hedge such an exposure. Most of the counterparties to the derivatives are major banks and the Company is monitoring the associated inherent credit risks. The Company does not enter into derivative transactions for trading purposes. b. Interest risk management: The Company raises capital through various debt instruments, including straight notes that bear a fixed or variable interest rate, bank loans, securitizations and convertible debentures. In some cases, the Company has swapped from a fixed to a floating interest rate (“fair value hedge”) and from a fixed to a fixed interest rate with an exchange from a currency other than the functional currency (“cash flow hedge”), thereby reducing overall interest expenses or hedging risks associated with interest rate fluctuations. c. Derivative instrument disclosure: The following table summarizes the notional amounts for hedged items, when transactions are designated as hedge accounting: December 31, 2019 2018 (U.S. $ in millions) Cross-currency swap—cash flow hedge $ — $ 588 Interest rate swap—fair value hedge — 500 Cross-currency swap—net investment hedge 1,000 1,000 d. Derivative instrument outstanding: The following table summarizes the classification and fair value of derivative instruments: Fair value Designated as hedging instruments Not designated as hedging instruments December 31, 2019 December 31, 2018 December 31, 2019 December 31, 2018 Reported under (U.S. $ in millions) Asset derivatives: Other current assets: Option and forward contracts $ — $ — $ 32 $ 18 Other non-current assets: Cross-currency swaps—cash flow hedge — 58 — Liability derivatives: Other current liabilities: Cross-currency swaps—net investment hedge (22 ) — Option and forward contracts — — (41 ) (26 ) Other taxes and long-term liabilities: Cross-currency swaps—net investment hedge — (41 ) — — Senior notes and loans: Interest rate swaps—fair value hedge — (9 ) — — The table below provides information regarding the location and amount of pre-tax Financial expenses, net Other comprehensive Year ended December 31, Year ended December 31, 2019 2018** 2017** 2019 2018** 2017** Reported under (U.S. $ in millions) Line items in which effects of hedges are recorded $ 822 $ 959 $ 895 $ 160 $ (585 ) $ 1,369 Cross-currency swaps—cash flow hedge (1) (2 ) (2 ) (3 ) (33 ) (35 ) 71 Cross-currency swaps—net investment hedge (2) (29 ) (31 ) (13 ) (22 ) (51 ) 97 Interest rate swaps—fair value hedge (3) 2 * (4 ) — — — * Represents an amount less than $0.5 million. ** Comparative figures are based on prior hedge accounting standard. The table below provides information regarding the location and amount of pre-tax Financial expenses, net Net revenues Year ended December 31, Year ended December 31, 2019 2018 2017 2019 2018 2017 Reported under (U.S. $ in millions) Line items in which effects of hedges are recorded $ 822 $ 959 $ 895 $ 16,887 $ 18,271 $ 21,853 Option and forward contracts (4) (51 ) (12 ) 82 — — — Option and forward contracts Economic hedge (5) — — — 14 (4 ) — (1) With respect to cross-currency swap agreements, Teva recognized gains which mainly reflect the differences between the fixed interest rate and the floating interest rate. In the fourth quarter of 2019, Teva terminated cross-currency swap agreements against its outstanding 3.65% senior notes maturing in November 2021. The settlement of these transactions resulted in cash proceeds of $95 million. The cash flow hedge accounting adjustments of these instruments, which are recorded under senior notes and loans, are amortized under financial expenses-net over the life of the debt as additional interest expense. (2) In each of the first and second quarters of 2017, Teva entered into a cross currency swap agreement with a notional amount of $500 million maturing in 2020. These cross currency swaps were designated as a net investment hedge of Teva’s foreign subsidiaries euro denominated net assets, in order to reduce the risk of adverse exchange rate fluctuations. With respect to these cross currency swap agreements, Teva recognized gains which mainly reflect the differences between the float-for-float in euros in U.S. dollar (3) In the fourth quarter of 2016, Teva entered into an interest rate swap agreement designated as fair value hedge relating to its 2.8% senior notes due 2023 with respect to $500 million notional amount of outstanding debt. With respect to this interest rate swap agreement, Teva recognized a loss which mainly reflects the differences between the fixed interest rate and the floating interest rate. In the third quarter of 2019, Teva terminated this interest rate swap agreement. The settlement of these transactions resulted in cash proceeds 10 fair value hedge expenses-net (4) Teva uses foreign exchange contracts (mainly option and forward contracts) to hedge balance sheet items from currency exposure. These foreign exchange contracts are not designated as hedging instruments for accounting purposes. In connection with these foreign exchange contracts, Teva recognizes gains or losses that offset the revaluation of the balance sheet items also recorded under financial expenses—net. (5) Teva entered into option and forward contracts designed to limit the exposure of foreign exchange fluctuations on revenues and expenses recorded in euro, the British pound, the Russian ruble and some other currencies during the quarter for which such instruments are purchased. These derivative instruments do not meet the criteria for hedge accounting, however, they are accounted for as economic hedge. These derivative instruments are recognized on the Balance Sheet at their fair value, with changes in the fair value recognized under the same line item in the Statements of Income as the underlying exposure being hedged. The cash flows associated with these derivatives are reflected as cash flows from operating activities in the consolidated Statements of Cash Flows. e. Matured forward starting interest rate swaps and treasury lock agreements: Commencing in the third quarter of 2015, Teva entered into forward starting interest rate swap and treasury lock agreements designated as cash flow hedges of the U.S. dollar debt issuance in July 2016, with respect to $3.75 billion and $1.5 billion notional amounts, respectively. These agreements hedged the variability in anticipated future interest payments due to possible changes in the benchmark interest rate between the date the agreements were entered into and the actual date of the U.S. dollar debt issuance in July 2016 (in connection with the closing of the Actavis Generics acquisition). Certain of the forward starting interest rate swaps and treasury lock agreements matured during the first half of 2016. In July 2016, in connection with the debt issuances, Teva terminated the remaining forward starting interest rate swaps and treasury lock agreements. The termination of these transactions resulted in a loss position of $ 493 million, of which $ 242 million were settled on October 7, 2016 and the remaining amount was settled in January 2017. The change in fair value of these instruments recorded in other comprehensive income (loss) will be amortized under financial expenses-net With respect to the forward starting interest rate swaps and treasury lock agreements, losses of $29 million, $28 million and $27 million were recognized under financial expenses, net for the years ended December 31, 2019, In the third quarter of 2019, Teva terminated $500 million interest rate swap agreements designated as fair value hedge relating to its 2.8% senior notes due 2023 with respect to $3,000 million notional amount. Settlement of these transactions resulted in cash proceeds of $ 10 are - In the fourth quarter of 2019, Teva terminated $588 million cross-currency swap agreements against its outstanding 3.65% senior notes maturing in November 2021. Settlement of these transactions resulted in cash proceeds of $95 million. The cash flow hedge accounting adjustments of these instruments, which are recorded under senior notes and loans, are amortized under financial expenses-net With respect to the interest rate swap agreements, gains of $6 million, $6 million and $7 million were recognized under financial expenses, net for the years ended December 31, 2019, 2018 and 2017, respectively. f. Securitization: In April 2011, Teva established a trade receivables securitization program to sell trade receivables to BNP Paribas Bank (“BNP”). Under the program Teva (on a consolidated basis) receives, as purchase price for the receivables sold by it, an initial cash purchase price and the right to receive a deferred purchase price (“DPP”). On an individual seller basis, each Teva subsidiary sells receivables to BNP for an amount equal to their nominal amount. BNP then immediately on-sells on-sells The SPE is a VIE for which Teva is considered to be the primary beneficiary. The SPE’s sole business consists of the purchase of receivables from Teva subsidiaries and the subsequent transfer of such receivables to the conduit. Although the SPE is included in Teva’s consolidated financial statements, it is a separate legal entity with separate creditors. The conduit and other designated creditors of the SPE are entitled, both before and upon the SPE’s liquidation, to be paid out of the SPE’s assets prior to the DPP payable to Teva. The assets of the SPE are not available to pay creditors of Teva or its subsidiaries. This program expires on August 21, 2020 but can be renewed with consent from the parties to the program up to August 31, 2021 or any other date agreed between the parties. Once sold to BNP, the relevant Teva subsidiary as seller has no retained interests in the receivables sold and they are unavailable to the relevant seller should the relevant seller become insolvent. The conduit has all the rights in the securitized trade receivables, including the right to pledge or dispose of such receivables. Consequently, receivables sold under this agreement are de-recognized The portion of the purchase price for the receivables which is not paid in cash by the conduit is a DPP asset. The conduit pays the SPE the DPP from collections received by the conduit from the securitized trade receivables (after paying senior costs and expenses, including the conduit’s debt service obligations), which the SPE then pays to Teva. Teva has collection and administrative responsibilities for the sold receivables. The fair value of these servicing arrangements as well as the fees earned was immaterial. DPP asset as of December 31, 2019 and 2018 was $250 million and $231 million, respectively. As of December 31, 2019 and 2018, the balance of Teva’s securitized assets sold were $690 million and $686 million, respectively. The following table summarizes the sold receivables outstanding balance net of DPP asset under the outstanding securitization program: As of and for the year ended 2019 2018 (U.S. $ in millions) Sold receivables at the beginning of the year $ 686 $ 799 Proceeds from sale of receivables 4,852 5,071 Cash collections (remitted to the owner of the receivables) (4,849 ) (5,151 ) Effect of currency exchange rate changes 1 (33 ) Sold receivables at the end of the year $ 690 $ 686 |
Legal Settlements and Loss Cont
Legal Settlements and Loss Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Legal Settlements and Loss Contingencies | NOTE 11—Legal settlements and loss contingencies: Legal settlements and loss contingencies for 2019 amounted to an expense an inc ome million and an expense of $500 million in 2018 and 2017, respectively. The expense in 2019 w as settlement of As of December 31, 2019 and 2018, accrued amounts for legal settlements and loss contingencies of $1,580 million and $562 million, respectively, we |
Commitments and contingencies
Commitments and contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and contingencies | NOTE 12—Commitments and contingencies: a. Commitments: Royalty commitments: The Company is committed to pay royalties to owners of know-how, Until September 30, 2018, royalty expenses were reported in cost of goods sold if related to the acquisition of a product, and if not, such expenses we Milestone commitments: Teva has committed to make potential future milestone payments to third parties under various agreements. These payments are contingent upon the occurrence of certain future events and, given the nature of these events, it is unclear when, if ever, Teva may be required to pay such amounts. As of December 31, 2019, if all milestones and targets, for compounds in phase 2 and more advanced stages of development, are achieved, the total contingent payments could reach an aggregate amount of up to $426 million. b. Contingencies: General From time to time, Teva and/or its subsidiaries are subject to claims for damages and/or equitable relief arising in the ordinary course of business. In addition, as described below, in large part as a result of the nature of its business, Teva is frequently subject to litigation. Teva generally believes that it has meritorious defenses to the actions brought against it and vigorously pursues the defense or settlement of each such action. Except as described below, Teva does not currently have a reasonable basis to estimate the loss, or range of loss, that is reasonably possible with respect to matters disclosed in this note. Teva records a provision in its financial statements to the extent that it concludes that a contingent liability is probable and the amount thereof is estimable. Based upon the status of the cases described below, management’s assessments of the likelihood of damages, and the advice of counsel, no provisions have been made regarding the matters disclosed in this note, except as noted below. Litigation outcomes and contingencies are unpredictable, and excessive verdicts can occur. Accordingly, management’s assessments involve complex judgments about future events and often rely heavily on estimates and assumptions. Teva continuously reviews the matters described below and may, from time to time, remove previously disclosed matters that the Company has determined no longer meet the materiality threshold for disclosure. If one or more of such proceedings described below were to result in final judgments against Teva, such judgments could be material to its results of operations and cash flows in a given period. In addition, Teva incurs significant legal fees and related expenses in the course of defending its positions even if the facts and circumstances of a particular litigation do not give rise to a provision in the financial statements. In connection with third-party agreements, Teva may under certain circumstances be required to indemnify, and may be indemnified by, in unspecified amounts, the parties to such agreements against third-party claims. Among other things, Teva’s agreements with third parties may require Teva to indemnify them, or require them to indemnify Teva, for the costs and damages incurred in connection with product liability claims, in specified or unspecified amounts. Except as otherwise noted, all of the litigation matters disclosed below involve claims arising in the United States. Except as otherwise noted, all third party sales figures given below are based on IQVIA (formerly IMS Health Inc.) data. For income tax contingencies, see note 13. Intellectual Property Litigation From time to time, Teva seeks to develop generic versions of patent-protected pharmaceuticals for sale prior to patent expiration in various markets. In the United States, to obtain approval for most generics prior to the expiration of the originator’s patents, Teva must challenge the patents under the procedures set forth in the Hatch-Waxman Act of 1984, as amended. To the extent that Teva seeks to utilize such patent challenge procedures, Teva is and expects to be involved in patent litigation regarding the validity, enforceability or infringement of the originator’s patents. Teva may also be involved in patent litigation involving the extent to which its product or manufacturing process techniques may infringe other originator or third-party patents. Additionally, depending upon a complex analysis of a variety of legal and commercial factors, Teva may, in certain circumstances, elect to market a generic version even though litigation is still pending. To the extent Teva elects to proceed in this manner, it could face substantial liability for patent infringement if the final court decision is adverse to Teva, which could be material to its results of operations and cash flows in a given period. The general rule for damages in patent infringement cases in the United States is that the patentee should be compensated by no less than a reasonable royalty and it may also be able, in certain circumstances, to be compensated for its lost profits. The amount of a reasonable royalty award would generally be calculated based on the sales of Teva’s product. The amount of lost profits would generally be based on the lost sales of the patentee’s product. In addition, the patentee may seek consequential damages as well as enhanced damages of up to three times the profits lost by the patent holder for willful infringement, although courts have typically awarded much lower multiples. Teva is also involved in litigation regarding patents in other countries where it does business, particularly in Europe. The laws concerning generic pharmaceuticals and patents differ from country to country. Damages for patent infringement in Europe may include lost profits or a reasonable royalty, but enhanced damages for willful infringement are generally not available. In July 2014, GlaxoSmithKline (“GSK”) sued Teva in Delaware federal court for infringement of a patent expiring in June 2015 directed to using carvedilol in a specified manner to decrease the risk of mortality in patients with congestive heart failure. Teva and eight other generic producers began selling their carvedilol tablets (the generic version of GSK’s Coreg ® million, not including pre- In 2014, Teva Canada succeeded in its challenge of the bortezomib (the generic equivalent of Velcade ® infringement of the same two patents as well as a patent covering a process to prepare bortezomib. The product patent expired in October 2015; the other patents expire in January 2022 and March 2025. In 2017, Teva entered into an agreement with Janssen and Millennium which limits the damages payable by either party depending on the outcome of the infringement/impeachment action. As a result, the most Janssen and Millennium could recover is 200 million Canadian dollars plus post-judgment interest. In June 2018, the court ruled that Janssen and Millennium pay Teva 5 million Canadian dollars in Section 8 damages. Janssen and Millennium filed an appeal , which was denied by the appellate court on November 4, 2019. On January 3, 2020, Janssen and Millennium applied for leave to appeal to the Canadian Supreme Court. If the decision is ultimately overturned, Teva could owe the capped damages set forth above. In addition to the potential damages that could be awarded, Teva could be ordered to cease sales of its bortezomib product. On July 8, 2011, Helsinn sued Teva over its filing of an ANDA to market a generic version of palonosetron IV solution (the generic equivalent of Aloxi ® In July 2015, Janssen sued Actavis and Teva (along with 10 other filers) over their filing of an ANDA to market their abiraterone acetate tablets, 250mg (generic versions of Zytiga ® Product Liability Litigation Teva’s business inherently exposes it to potential product liability claims. Teva maintains a program of insurance, which may include commercial insurance, self-insurance (including direct risk retention), or a combination of both approaches, in amounts and on terms that it believes are reasonable and prudent in light of its business and related risks. However, Teva sells, and will continue to sell, pharmaceuticals that are not covered by its product liability insurance; in addition, it may be subject to claims for which insurance coverage is denied as well as claims that exceed its policy limits. Product liability coverage for pharmaceutical companies is becoming more expensive and increasingly difficult to obtain. As a result, Teva may not be able to obtain the type and amount of insurance it desires, or any insurance on reasonable terms, in all of its markets. Competition Matters As part of its generic pharmaceuticals business, Teva has challenged a number of patents covering branded pharmaceuticals, some of which are among the most widely-prescribed and well-known drugs on the market. Many of Teva’s patent challenges have resulted in litigation relating to Teva’s attempts to market generic versions of such pharmaceuticals under the federal Hatch-Waxman Act. Some of this litigation has been resolved through settlement agreements in which Teva obtained a license to market a generic version of the drug, often years before the patents expire. Teva and its subsidiaries have increasingly been named as defendants in cases that allege antitrust violations arising from such settlement agreements. The plaintiffs in these cases, which are usually direct and indirect purchasers of pharmaceutical products, and often assert claims on behalf of classes of all direct and indirect purchasers, typically allege that (1) Teva received something of value from the innovator in exchange for an agreement to delay generic entry, and (2) significant savings could have been realized if there had been no settlement agreement and generic competition had commenced earlier. These class action cases seek various forms of injunctive and monetary relief, including damages based on the difference between the brand price and what the generic price allegedly would have been and disgorgement of profits, which are automatically tripled under the relevant statutes, plus attorneys’ fees and costs. The alleged damages generally depend on the size of the branded market and the length of the alleged delay, and can be substantial — potentially measured in multiples of the annual brand sales — particularly where the alleged delays are lengthy or branded drugs with annual sales in the billions of dollars are involved. Teva believes that its settlement agreements are lawful and serve to increase competition, and has defended them vigorously. In Teva’s experience to date, these cases have typically settled for a fraction of the high end of the damages sought, although there can be no assurance that such outcomes will continue. In June 2013, the U . . In April 2006, certain subsidiaries of Teva were named in a class action lawsuit filed in the U.S. District Court for the Eastern District of Pennsylvania. The case alleges that the settlement agreements entered into between Cephalon, Inc., now a Teva subsidiary (“Cephalon”), and various generic pharmaceutical companies in late 2005 and early 2006 to resolve patent litigation involving certain finished modafinil products (marketed as PROVIGIL ® In May 2015, Cephalon entered into a consent decree with the FTC (the “Modafinil Consent Decree”) under which the FTC dismissed its claims against Cephalon in the FTC Modafinil Action in exchange for payment of $1.2 billion (less set-offs non-financial ten-year Additionally, following an investigation initiated by the European Commission in April 2011 regarding a modafinil patent settlement in Europe, the European Commission issued a Statement of Objections in July 2017 against both Cephalon and Teva alleging that the 2005 settlement agreement between the parties had the object and effect of hindering the entry of generic modafinil. No final decision regarding liability has yet been taken by the European Commission. The sales of modafinil in the European Economic Area during the last full year of the alleged breach amounted to € million. In January 2009, the FTC and the State of California filed a complaint for injunctive relief in California federal court alleging that a September 2006 patent lawsuit settlement between Watson Pharmaceuticals, Inc. (“Watson”), from which Teva later acquired certain assets and liabilities, and Solvay Pharmaceuticals, Inc. (“Solvay”) relating to AndroGel ® paid in full. In addition, in , certain other direct-purchaser plaintiffs (who would have been members of the direct purchaser class, had it been certified) filed their own claims in federal court in Philadelphia, challenging (in one complaint) both the settlement between Watson and referenced above, as well as ’s settlement with AbbVie involving AndroGel ® and TriCor ® , referenced below. Annual sales of AndroGel ® % were approximately $ million at the time of the settlement and approximately $ million at the time launched its generic version of AndroGel ® % in . A provision for this case was included in the financial statements. In December 2011, three groups of plaintiffs sued Wyeth and Teva for alleged violations of the antitrust laws in connection with their settlement of patent litigation involving extended release venlafaxine (generic Effexor XR ® . . ® ® In February 2012, two purported classes of direct-purchaser plaintiffs sued GSK and Teva in New Jersey federal court for alleged violations of the antitrust laws in connection with their settlement of patent litigation involving lamotrigine (generic Lamictal ® ® million at the time of the settlement and approximately $ billion at the time Teva launched its generic version of Lamictal ® In April 2013, purported classes of direct purchasers of, and end payers for, Niaspan ® 2005 to resolve patent litigation over the product. A multidistrict litigation has been established in the U.S. District Court for the Eastern District of Pennsylvania. Throughout 2015 and in January 2016, several individual direct purchaser opt-out s ® $ million at the time of the settlement and approximately $ billion at the time Teva launched its generic version of Niaspan ® In November 2013, a putative class action was filed in Pennsylvania federal court against Actavis, Inc. and certain of its affiliates, alleging that Watson’s 2012 patent lawsuit settlement with Endo Pharmaceuticals Inc. relating to Lidoderm ® end-payer in full ® end-payers Since November 2013, numerous lawsuits have been filed in various federal courts by purported classes of end payers for, and direct purchasers of, Aggrenox ® ® opt-out opt-out in full Opt-outs appeal remains pending. Annual sales of Aggrenox ® were approximately $ million at the time of the settlement and approximately $ million at the time launched its authorized generic version of ® in July 2015. Since January 2014, numerous lawsuits have been filed in the U.S. District Court for the Southern District of New York by purported classes of end payers for, and direct purchasers of, Actos ® ® $3.7 billion and approximately $500 million, respectively. At the time Teva launched its authorized generic version of Actos ® ® In September 2014, the FTC sued AbbVie Inc. and certain of its affiliates (“AbbVie”) as well as Teva in federal court in Philadelphia alleging that they violated the antitrust laws when they entered into a December 2011 settlement agreement to resolve the AndroGel ® ® $ million in disgorgement but declined to award injunctive relief. The FTC filed a notice of appeal as to, among other things, the district court’s May 2015 dismissal of the FTC’s claim against Teva, but in February 2019, the FTC stipulated to dismiss Teva from its appeal, in exchange for Teva’s agreement to amend the Modafinil Consent Decree, as described above. In August 2019, two groups of direct-purchaser plaintiffs filed similar claims against AbbVie and Teva, in the same federal court in Philadelphia where the FTC’s claims had been pending. The first group, comprised of the three direct purchasers that had sought class certification in the Georgia AndroGel ® purchasers, have filed claims challenging both Teva’s December 2011 settlement with AbbVie and the September 2006 AndroGel ® Those claims remain In May 2015, a purported class of end payers for Namenda IR ® opt-outs ® ® $ billion and approximately $ million at the time other manufacturers first launched generic versions of Namenda IR ® In January 2019, generic manufacturer Cipla Limited filed a lawsuit against Amgen in Delaware federal court, alleging, among other things, that a January 2, 2019 settlement agreement between Amgen and Teva, resolving patent litigation over cinacalcet (generic Sensipar ® end-payer ® ® On December 16, 2016, the U.K. Competition and Markets Authority (“CMA”) issued a statement of objections (a provisional finding of breach of the Competition Act) in respect of certain allegations against Allergan, Actavis UK and certain Auden Mckenzie entities alleging competition law breaches in connection with the supply of 10mg and 20mg hydrocortisone tablets in the U.K. On December 18, 2017, the CMA issued a Statement of Draft Penalty Calculation. On March 3, 2017 and February 28, 2019, the CMA issued second and third statements of objections in respect of certain additional allegations relating to the same products and covering part of the same time periods as in the first statement of objections. On February 12, 2020, the CMA issued a supplementary statement of objections effectively combining the three previously issued statements referenced above. On January 9, 2017, Teva completed the sale of Actavis UK to Accord Healthcare Limited, in connection with which Teva will indemnify Accord Healthcare for potential fines imposed by the CMA and/or damages awarded by a court against Actavis UK in relation to the December 1 6 6 Since November 2016, several putative indirect purchaser and direct purchaser class actions were filed in federal courts in Wisconsin, Massachusetts and Florida against Shire U.S., Inc. and Shire LLC (collectively, “Shire”), Actavis and Teva, alleging that Shire’s 2013 patent litigation settlement with Actavis related to the ADHD drug Intuniv ® , ® $ million at the time of the settlement and approximately $ million at the time Actavis launched its generic version of Intuniv ® In 2015 and 2016, Actavis and Teva USA each respectively received subpoenas from the DOJ Antitrust Division seeking documents and other information relating to the marketing and pricing of certain Teva USA generic products and communications with competitors about such products. In May 2018, Teva received a civil investigative demand from the DOJ Civil Division, pursuant to the federal False Claims Act, seeking documents and information produced since January 1, 2009 relevant to the Civil Division’s investigation concerning allegations that generic pharmaceutical manufacturers, including Teva, engaged in market allocation and price-fixing agreements, paid illegal remuneration, and caused false claims to be submitted in violation of the False Claims Act. Teva is cooperating with these subpoena requests. In 2015 and 2016, Actavis and Teva USA each respectively received a subpoena from the Connecticut Attorney General seeking documents and other information relating to potential state antitrust law violations. Subsequently, on December 15, 2016, a civil action was brought by the attorneys general of twenty states against Teva USA and several other companies asserting claims under federal antitrust law alleging price fixing of generic products in the United States. That complaint was later amended to add new states as named plaintiffs, as well as new allegations and new state law claims, and on June 18, 2018, the attorneys general of 49 states plus Puerto Rico and the District of Columbia filed a consolidated amended complaint against Actavis and Teva, as well as other companies and individuals. On May 10, 2019, most (though not all) of these same attorneys general filed yet another antitrust complaint against Actavis, Teva and other companies and individuals, alleging price-fixing and market allocation with respect to additional generic products. On November 1, 2019, the state attorneys general filed an amended complaint, bringing the total number of plaintiff states and territories to 54. The amended complaint alleges that Teva was at the center of a conspiracy in the generic pharmaceutical industry, and asserts that Teva and others fixed prices, rigged bids, and allocated customers and market share with respect to certain additional products, many of which were not previously at issue in the Pennsylvania MDL. In the various complaints described above, the states seek a finding that the defendants’ actions violated federal antitrust law and state antitrust and consumer protection laws, as well as injunctive relief, disgorgement, damages on behalf of various state and governmental entities and consumers, civil penalties and costs. All such complaints have been transferred to the generic drug multidistrict litigation in the Eastern District of Pennsylvania (“Pennsylvania MDL”). Beginning on March 2, 2016, numerous complaints have been filed in the United States on behalf of putative classes of direct and indirect purchasers of several generic drug products, as well as several individual direct and indirect purchaser opt-out Government Investigations and Litigation Relating to Pricing and Marketing Teva is involved in government investigations and litigation arising from the marketing and promotion of its pharmaceutical products in the United States. Many of these investigations originate through what are known as qui tam A number of state attorneys general have filed various actions against Teva and/or certain of its subsidiaries relating to reimbursements or drug price reporting under Medicaid or other programs. Such price reporting is alleged to have caused states and others to pay inflated reimbursements for covered drugs. Teva and its subsidiaries have reached settlements in most of these cases. On October 4, 2018, Teva settled longstanding litigation filed by the State of Illinois against subsidiaries of Teva and Watson for a total settlement amount of $135 million. Teva accepted the settlement while denying any liability with respect to the claims made by the state. Following on Jan uary 8, 2020, the tr ial court dismissed with pr e subsidiaries were dismissed by the trial court in an action brought by the State of Utah. That dismissal was affirmed by the Utah Court of Appeals on February 28, 2019. The State’s time to seek further appellate review has expired and the matter is now concluded. A provision for these cases was included in the financial statements and settlement amounts were paid in full . Several qui tam complaints have been unsealed in recent years as a result of government decisions not to participate in the cases. The following is a summary of certain government investigations, qui tam actions and related matters. In January 2014, Teva received a civil investigative demand from the U.S. Attorney for the Southern District of New York seeking documents and information from January 1, 2006 related to sales, marketing and promotion of COPAXONE ® ® In January 2014, a qui tam complaint was filed in Rhode Island federal court alleging that Teva and several other defendants, including manufacturers of MS drugs and pharmacy benefit managers, violated the False Claims Act. The qui tam action was unsealed on April 4, 2018 after the government declined to intervene. The relator alleges that Teva and the other defendants induced fraudulent overpayments for illegitimate “Bona Fide Service Fees” in excess of fair market value to inflate prices for the Medicare Part D program. Teva moved to dismiss the complaint. The DOJ also moved to dismiss the complaint, arguing that it lacked merit and was not in the government’s interest to continue. On September 27, 2019, the Court granted the DOJ’s motion to dismiss. In May 2017, a qui tam action was filed against a number of Teva subsidiaries. The qui tam action was unsealed on June 13, 2018 after the government declined to intervene. The relator in the case alleges that Teva violated the False Claims Act by devising and engaging in promotional schemes that violate the Anti-Kickback Statute (“AKS”), resulting in false certifications of compliance with the AKS. Specifically, the relator alleges that Teva paid in-kind On March 21, 2017, Teva received a subpoena from the U.S. Attorney’s office in Boston, Massachusetts requesting documents related to Teva’s donations to patient assistance programs. Teva is cooperating in responding to the subpoena. In December 2016, Teva resolved certain claims under the U.S. Foreign Corrupt Practices Act (“FCPA”) with the SEC and the DOJ. The settlement included a fine, disgorgement and prejudgment interest, a three-year deferred prosecution agreement (“DPA”) for Teva and the retention of an independent compliance monitor for a period of three years. If, during the term of the DPA, the DOJ had determined that Teva had committed a felony under federal law, provided deliberately false or misleading information or otherwise breached the DPA, Teva could have been subject to prosecution and additional fines or penalties, including the deferred charges. In November 2019, Teva’s independent compliance monitor certified that Teva’s compliance program is reasonably designed and implemented to prevent and detect violations of anti-corruption laws. In February 2020 the term of the monitorship provided for by the DPA and Teva’s consent judgement with the SEC expired. Upon completion of this term, Teva’s Chief Compliance Officer submitted a certification to the SEC confirming that Teva has complied with the monitorship requirements. Also, in February 2020, Teva’s CEO and CFO submitted certifications to the DOJ confirming that Teva has complied with its disclosure obligations under the DPA. Under the terms of the DPA, upon receipt of these certifications, and satisfactory completion of all other requirements, the DOJ is expected to move to dismiss the information filed against Teva. Opioids Litigation Since May 2014, more than 2,000 complaints have been filed with respect to opioid sales and distribution against various Teva affiliates, along with several other pharmaceutical companies, by a number of cities, counties, states, other governmental agencies, tribes and private plaintiffs (including various putative class actions of individuals) in both state and federal courts. Most of the federal cases have been consolidated into a multidistrict litigation in the Northern District of Ohio (“MDL Opioid Proceeding”) and many of the cases filed in state court have been removed to federal court and consolidated into the MDL Opioid Proceeding. Other cases remain pending in various states. In some jurisdictions, such as Illinois, New York, Pennsylvania, South Carolina, Texas and Utah, certain state court cases have been transferred to a single court within their respective state court systems for coordinated pretrial proceedings. Absent resolutions, trials are expected to proceed in several states in 2020. A court in New York has set a date, for a liability trial only, to start in March 2020. A court in California also set a date for a trial to start in June 2020. Complaints asserting claims under similar provisions of different state law, generally contend that the defendants allegedly engaged in improper marketing and distribution of opioids, including ACTIQ ® ® non-monetary In May 2019, Teva settled the Oklahoma litigation brought by the Oklahoma Attorney General (State of Oklahoma, ex. rel. Mike Hunter, Attorney General of Oklahoma vs. Purdue Pharma L.P., et. al.) for $85 million. The settlement did not include any admission of violation of law for any of the claims or allegations made. As the Company demonstrated a willingness to settle part of the litigation, for accounting purposes, management considered a portion of opioid-related cases as probable and, as such, recorded an estimated provision in the second quarter of 2019. Given the relatively early stage of the cases, management viewed no amount within the range to be the most likely outcome. Therefore, management recorded a provision for the reasonably estimable minimum amount in the assessed range for such opioid-related cases in accordance with Accounting Standards Codification 450 “Accounting for Contingencies.” On October 21, 2019, Teva reached a settlement with the two plaintiffs in the MDL Opioid Proceeding that was scheduled for trial for the Track One case, Cuyahoga and Summit Counties of Ohio. Under the terms of the settlement, Teva will provide the two counties with opioid treatment medication, buprenorphine naloxone (sublingual tablets), known by the brand name Suboxone ® $ million at wholesale acquisition cost and distributed over three years to help in the care and treatment of people suffering from addiction, and a cash payment in the amount of $20 million, to be paid in four payments over three years. Also on October 21, 2019, Teva and certain other defendants reached an agreement in principle with a group of Attorneys General from North Carolina, Pennsylvania, Tennessee and Texas for a nationwide settlement framework. The framework is designed to provide a mechanism by which the Company attempts to seek resolution of remaining potential and pending opioid claims by both the U.S. states and political subdivisions (i.e., counties, tribes and other plaintiffs) thereof. Under this agreement, Teva would provide buprenorphine naloxone (sublingual tablets) with an estimated value of up to approximately $23 billion at wholesale acquisition cost over a ten year period. In addition, Teva would also provide cash payments of up to $250 million over a ten year period. The Company cannot predict if the nationwide settlement framework will be finalized. Following these developments, the Company considered a range of potential settlement outcomes. No single outcome in the range was considered to be more likely than any other outcome; accordingly, in the third quarter of 2019, Teva accrued to the new low end of the range, resulting in an increase in Teva’s previously recorded estimated liability. There was no change in this estimate in the fourth quarter of 2019. Separately, on April 27, 2018, Teva received subpoena requests from the United States Attorney’s office in the Western District of Virginia and the Civil Division seeking documents relating to the manufacture, marketing and sale of branded opioids. In August 2019, Teva received a grand jury subpoena from the United States Attorney’s Office for the Eastern District of New York for documents related to the Company’s anti-diversion policies and procedures and distribution of its opioid medications, in what the Company understands to be part of a broader investigation into manufacturers’ and distributors’ monitoring programs and reporting under the Controlled Substances Act. In September 2019, Teva received subpoenas from the New York State Department of Financial Services (NYDFS) as part of an industry-wide inquiry into the effect of opioid prescriptions on New York health insurance premiums. The Company is cooperating with NYDFS’s inquiry and producing documents in response to the various subpoenas and requests for information. Currently, Teva cannot predict how the nationwide settlement framework agreement (if finalized) will affect these investigations. In addition, a number of state attorneys general, including a coordinated multistate effort, have initiated investigations into sales and marketing practices of Teva and its affiliates with respect to opioids. Other states are conducting their own investigations outside of the multistate group. Teva is cooperating with these ongoing investigations and cannot predict their outcome at this time. In addition, several jurisdictions in Canada have initiated litigation regarding opioids alleging similar claims as those in the United States. The cases in Canada are likely to be consolidated and are in their early stages. Shareholder Litigation On November 6, 2016 and December 27, 2016, two putative securities class actions were filed in the U.S. District Court for the Central District of California against Teva and certain of its current and former officers and directors. After those two lawsuits were consolidated and transferred to the U.S. District Court for the District of Connecticut, the court appointed the Ontario Teachers’ Pension Plan Board as lead plaintiff (the “Ontario Teachers Securities Litigation”). The lead plain |
Income taxes
Income taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income taxes | NOTE 13—Income taxes : a. Income (loss) before income taxes: Year ended December 31, 2019 2018 2017 (U.S. $ in millions) Parent Company and its Israeli subsidiaries $ 542 $ 1,022 $ 1,451 Non-Israeli (1,807 ) (3,618 ) (19,830 ) $ (1,265 ) $ (2,596 ) $ (18,379 ) b. Income taxes: Year ended December 31, 2019 2018 2017 (U.S. $ in millions) In Israel $ 107 $ 131 $ 96 Outside Israel (385 ) (326 ) (2,029 ) $ (278 ) $ (195 ) $ (1,933 ) Current $ 885 $ 700 $ 373 Deferred (1,163 ) (895 ) (2,306 ) $ (278 ) $ (195 ) $ (1,933 ) 2019 2018 2017 (U.S. $ in millions) Income ( L $ (1,265 ) $ (2,596 ) $ (18,379 ) Statutory tax rate in Israel 23.0 % 23.0 % 24.0 % Theoretical provision for income taxes $ (291 ) $ (597 ) $ (4,411 ) Increase (decrease) in effective tax rate due to: The Parent Company and its Israeli subsidiaries - Mainly tax benefits arising from reduced tax rates under benefit programs (44 ) (134 ) (253 ) Non-Israeli (115 ) 381 3,817 U.S. Tax Cuts and Jobs Act effect 97 (1,061 ) Increase (decrease) in other uncertain tax positions—net 172 58 (25 ) Effective consolidated income taxes $ (278 ) $ (195 ) $ (1,933 ) * In 2019, i s non-Israeli i s non-Israeli The effective tax rate is the result of a variety of factors, including the geographic mix and type of products sold during the year, different effective tax rates applicable to non-Israeli c. Deferred income taxes: December 31, 2019 2018 (U.S. $ in millions) Long-term deferred tax assets (liabilities)—net: Inventory related $ 144 $ 113 Sales reserves and allowances 198 199 Provision for legal settlements 260 42 Intangible assets (*) (1,733 ) (2,282 ) Carryforward losses and deductions and credits (**) 1,689 1,340 Property, plant and equipment (170 ) (167 ) Deferred interest 648 391 Provisions for employee related obligations 106 102 Other 122 123 1,264 (139 ) Valuation allowance—in respect of carryforward losses and deductions that may not be utilized (1,974 ) (1,633 ) $ (710 ) $ (1,772 ) * The decrease in deferred tax liability is mainly due to impairment and amortization. ** The amounts are shown after reduction for unrecognized tax benefits of $ Th ese s 2020 2022 2023 2030 The deferred income taxes are reflected in the balance sheets among: December 31, 2019 2018 (U.S. $ in millions) Long-term assets—deferred income taxes 386 368 Long-term liabilities—deferred income taxes (1,096 ) (2,140 ) $ (710 ) $ (1,772 ) d. Uncertain tax positions: The following table summarizes the activity of Teva’s gross unrecognized tax benefits: Year ended December 31, 2019 2018 2017 (U.S. $ in millions) Balance at the beginning of the year $ 1,072 $ 1,034 $ 734 Increase related to prior year tax positions, net 23 76 56 Increase related to current year tax positions 246 11 26 Decrease related to settlements with tax authorities and lapse of applicable statutes of limitations (118 ) (49 ) (56 ) Liabilities assumed in acquisitions — — 273 Other — — 1 Balance at the end of the year $ 1,223 $ 1,072 $ 1,034 Uncertain tax positions, mainly of a long-term nature, included accrued potential penalties and interest of $ 164 $131 112 $19 in e. Tax assessments: Teva files income tax returns in various jurisdictions with varying statutes of limitations. Teva In 2013, Teva settled the 2005-2007 income tax assessment with the Israeli tax authorities, paying $ 213 2008-2011 The Israeli tax authorities issued tax assessment decrees for 2008-2012 and a tax assessment for 2013-2016, challenging the Company’s positions on several issues. Teva has protested the 2008-2012 decrees before the Central District Court in Israel and challenged the tax assessment for 2013-2016 as well. The Company believes it has adequately provided for these items such that any adverse results would have an immaterial impact on Teva’s financial statements. In the United States, Teva has one tax issue in dispute for the 2009-2011 audit cycle, which is currently in litigation. The 2012-2014 audit cycle is ongoing, with an assessment report expected to be received in 2020. Additionally, Teva’s U.S. subsidiaries have multiple audit cycles open. The Company believes it has adequately provided for these items and that any adverse results would have an immaterial impact on Teva’s financial statements. Teva filed a claim seeking the refund of withholding taxes paid to the Indian tax authorities in 2012. Trial in this case is scheduled to begin in July 2020. A final and binding decision against Teva in this case may lead to an impairment in the amount of $146 million. The Company’s subsidiaries in Europe have received final tax assessments mainly through tax year 2014. f. Basis of taxation: The Company and its subsidiaries are subject to tax in many jurisdictions, and estimation is required in recording the assets and liabilities related to income taxes. The Company believes that its accruals for tax liabilities are adequate for all open years. The Company considers various factors in making these assessments, including past history, recent interpretations of tax law, and the specifics of each matter. Because tax regulations are subject to interpretation and tax litigation is inherently uncertain, these assessments can involve a series of complex judgments regarding future events. Incentives Applicable until 2013 Under the incentives regime applicable to the Company until 2013, industrial projects of Teva and certain of its Israeli subsidiaries were eligible for “Approved Enterprise” status. Most of the projects in Israel have been granted Approved Enterprise status under the “alternative” tax benefit track which offered tax exemption on undistributed income for a period of two to ten years, depending on the location of the enterprise. Upon distribution of such exempt income, the distributing company is subject to corporate tax at the rate ordinarily applicable to the Approved Enterprise’s income. Amendment 69 to the Investment Law Pursuant to Amendment 69 to the Investment Law (“Amendment 69”), a company that elected by November 11, 2013 to pay a corporate tax rate as set forth in that amendment (rather than the tax rate applicable to Approved Enterprise income) with respect to undistributed exempt income accumulated by the company up until December 31, 2011 is entitled to distribute a dividend from such income without being required to pay additional corporate tax with respect to such dividend. A company that has so elected must make certain qualified investments in Israel over the five-year period commencing in 2013. Teva invested the entire required amount in 2013. During 2013, Teva applied the provisions of Amendment 69 to certain exempt profits Teva accrued prior to 2012. Consequently, Teva paid $577 million in corporate tax on exempt income of $9.4 billion. Part of this income was distributed as dividends during 2013-2018, while the remainder is available to be distributed as dividends in future years with no additional corporate tax liability. Incentives Applicable starting 2014: Under Amendment 68 to the Investment Law, which Teva started applying in 2014, upon an irrevocable election made by a company, a uniform corporate tax rate will apply to all qualifying industrial income of such company (“Preferred Enterprise”), as opposed to the previous law’s incentives, which were limited to income from Approved Enterprises during the benefits period. Under the law, when the election is made, the uniform tax rate for 2014 until 2016 was 9% in areas in Israel designated as Development Zone A and 16% elsewhere in Israel. The uniform tax rate for Development Zone A, as of January 1, 2017, is 7.5% (as part of changes enacted in Amendment 73, as described below). The profits of these “Preferred Enterprise” will be freely distributable as dividends, subject to a 20% or lower withholding tax, under an applicable tax treaty. Certain “Special Preferred Enterprises” that meet more stringent criteria (significant investment, R&D or employment thresholds) will enjoy further reduced tax rates of 5% in Zone A and 8% elsewhere. In order to be classified as a “Special Preferred Enterprises,” the approval of three governmental authorities in Israel is required. The New Technological Enterprise Incentives Regime – Amendment 73 to the Investment Law Since 2017, a portion of the Company’s taxable income in Israel is entitled to a preferred 6% tax rate under Amendment 73 to the Investment Law as it pertains to Special Preferred Technological Enterprises. The new incentives regime applies to “Preferred Technological Enterprises” or “Special Preferred Technological Enterprises”. A “Preferred Technological Enterprise” is an enterprise that meet certain conditions, including, inter alia: a. Investment of at least 7% of income, or at least NIS 75 22 b. One of the following: a. At least 20% of the workforce (or at least 200 employees) are employed in R&D; b. A venture capital investment approximately equivalent to at least $ 2 c. Growth in sales or workforce by an average of 25% over the three years preceding the tax year. A “Special Preferred Technological Enterprise” is an enterprise that meets, inter alia conditions 1 and 2 above, and in addition has total annual consolidated revenues above NIS 10 billion (approximately $2.9 billion). Preferred Technological Enterprises are subject to a corporate tax rate of 7.5% on their income derived from intellectual property in areas in Israel designated as Zone A and 12% elsewhere, while Special Preferred Technological Enterprises are subject to 6% on such income. The withholding tax on dividends from these enterprises is 4% to foreign companies (or a lower rate under a tax treaty, if applicable). Income not eligible for Preferred Technological Enterprise benefits is taxed at the regular corporate tax rate, which is 23%, or the preferred tax rate, as the case may be. The Parent Company and its Israeli subsidiaries elected to compute their taxable income in accordance with Income Tax Regulations (Rules for Accounting for Foreign Investors Companies and Certain Partnerships and Setting their Taxable Income), 1986. Accordingly, the taxable income or loss is calculated in U.S. dollars. Applying these regulations reduces the effect of U.S. dollar – NIS exchange rate on the Company’s Israeli taxable income. Non-Israeli U.S. Tax reform On December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act (the “Act”), which among other provisions, reduced the U.S. corporate tax rate from 35% to 21%, effective January 1, 2018, and imposed a one-time The year ended December 31, 2017 includes a one-time re-measure The one-time one-time |
Equity
Equity | 12 Months Ended |
Dec. 31, 2019 | |
Equity | NOTE 14—Equity: a. Ordinary shares and ADSs As of December 31, 2019 and 2018, Teva had approximately 1.2 billion Tel-Aviv On December 17, 2018, the mandatory convertible preferred shares automatically converted into ordinary shares. As a result of this conversion, Teva issued 70.6 million ADSs. b. Mandatory convertible preferred shares On December 17, 2018, the mandatory convertible preferred shares automatically converted into ordinary shares at a ratio of 1 mandatory convertible preferred share to 16 ADSs, and all of the accumulated and unpaid dividends on the mandatory convertible preferred shares were paid in ADSs, at a ratio of 3.0262 ADSs per mandatory convertible preferred share, all in accordance with the conversion mechanism set forth in the terms of the mandatory convertible preferred shares. c. Stock-based compensation plans: Stock-based compensation plans are comprised of employee stock options, RSUs, PSUs, and other equity-based awards to employees, officers and directors. The purpose of the plans is to enable the Company to attract and retain qualified personnel and to motivate such persons by providing them with equity participation in the Company. On June 29, 2010, the Teva 2010 Long-Term Equity-Based Incentive Plan was approved by Teva’s shareholders, under which 70 million equivalent share units, including options exercisable into ordinary shares, RSUs and PSUs, were approved for grant. The 2010 Plan expired on June 28, 2015 (except with respect to awards outstanding on that date), and no additional awards under the 2010 Plan may be made. On September 3, 2015, the Teva 2015 Long-Term Equity-Based Incentive Plan was approved by Teva’s shareholders, under which 43.7 million equivalent share units, including options exercisable into ordinary shares, RSUs and PSUs, were approved for grant. On April 18, 2016, Teva’s shareholders approved an increase of an additional 33.3 million equivalent share units to the share reserve of Teva’s 2015 Long-Term Equity-Based Incentive Plan, so that 77 million equivalent share units, including options exercisable into ordinary shares, RSUs and PSUs, are approved for grant. On July 13, 2017, Teva’s shareholders approved an increase of an additional 65 million equivalent share units to the share reserve of Teva’s 2015 Long-Term Equity-Based Incentive Plan, so that 142 million equivalent share units, including options exercisable into ordinary shares, RSUs and PSUs, are approved for grant. As of December 31, 2019, 62.7 million equivalent share units remain available for future awards. In the past, Teva had various employee stock and incentive plans under which stock options and other share-based awards were granted. Stock options and other share-based awards granted under such prior plans continue in accordance with the terms of the respective plans. The vesting period of the outstanding options, RSUs and PSUs is generally from 1 to 4 years from the date of grant. The rights of the ordinary shares obtained from the exercise of options, RSUs or PSUs are identical to those of the other ordinary shares of the Company. The contractual term of these options is primarily for seven years in prior plans and ten years for options granted under the 2010 and 2015 plans described above. Status of options A summary of the status of the options as of December 31, 2019, 2018 and 2017, and changes during the years ended on those dates, is presented below (the number of options represents ordinary shares exercisable in respect thereof). Year ended December 31, 2019 2018 2017 Number (in thousands) Weighted Number (in thousands) Weighted Number (in thousands) Weighted Balance outstanding at begin n 48,393 $ 38.62 43,121 $ 44.32 32,789 $ 50.71 Changes during the year: Granted — — 12,401 19.12 15,467 32.08 Exercised (11 ) 16.99 (84 ) 17.01 (7 ) 17.44 Forfeited (8,318 ) 42.12 (7,040 ) 39.38 (4,953 ) 47.92 Expired — — (5 ) 50.65 (175 ) 59.81 Balance outstanding at end of year 40,064 37.90 48,393 38.62 43,121 44.32 Balance exercisable at end of year 26,601 43.41 24,086 46.89 19,129 47.94 The weighted average fair value of options granted during these years was generally estimated by using the Black-Scholes option-pricing model as follows: Year ended December 31, 2019 2018 2017 Weighted average fair value — $ 7.4 $ 5.7 The fair value of these options was estimated on the date of grant, based on the following weighted average assumptions: Year ended December 31, 2019 2018 2017 Dividend yield — 0 % 3.7 % Expected volatility — 40 % 29 % Risk-free interest rate — 2.6 % 2.1 % The expected term was estimated based on the weighted average period for which the options granted are expected to be outstanding, taking into consideration the current vesting of options and the historical exercise patterns of existing options. The expected volatility assumption used is based on a blend of the historical and implied volatility of the Company’s stock. The risk-free interest rate used is based on the yield of U.S. Treasuries with a maturity closest to the expected term of the options granted. The dividend yield assumption reflects the expected dividend yield based on historical dividends and expected dividend growth. The following tables summarize s of (1) Number of ordinary shares issuable upon exercise of outstanding options Balance at end of Weighted average Weighted average Aggregate intrinsic Number of shares $ Years $ Lower than $15.01 592 11.40 7.85 — $15.01 - $25.00 10,938 18.94 8.13 — $25.01 - $35.00 7,914 34.62 7.16 — $35.01 - $45.00 5,511 40.59 2.49 — $45.01 - $55.00 10,328 50.74 4.53 — $55.01 - $65.00 4,781 59.20 5.31 — Total 40,064 37.90 5.89 — (2) Number of ordinary shares issuable upon exercise of vested options Balance at end of Weighted average Weighted average Aggregate intrinsic Number of shares $ Years $ Lower than $15.01 197 11.40 7.85 — $15.01 - $25.00 3,211 18.57 8.05 — $25.01 - $35.00 3,983 34.61 7.16 — $35.01 - $45.00 5,511 40.59 2.49 — $45.01 - $55.00 9,165 50.43 4.32 — $ 55.01 65.00 4,534 59.37 5.27 — Total 26,601 43.41 5.00 — The aggregate intrinsic value in the above tables represents the total pre-tax in-the-money. The total intrinsic value of options exercised during the years ended December 31, 2019, 2018 and 2017 was immaterial, based on the Company’s average stock price of $11.50 , and $25.62, for the years then ended, respectively . Status of non-vested The fair value of RSUs and PSUs is estimated based on the market value of the Company’s stock on the date of award grant (fair value of PSUs includes the effect of market conditions), less an estimate of dividends that will not accrue to RSU and PSU holders prior to vesting. The following table summarizes information about the number of RSUs and PSUs issued and outstanding: Year ended December 31, 2019 2018 2017 Number (in thousands) Weighted Number (in thousands) Weighted Number (in thousands) Weighted Balance outstanding at beginning of year 10,403 $ 20.93 7,468 $ 27.95 4,636 $ 45.15 Granted 9,303 15.36 5,900 18.80 5,461 20.10 Vested (2,435 ) 30.24 (1,638 ) 37.30 (1,884 ) 39.63 Forfeited (1,294 ) 18.74 (1,327 ) 32.50 (745 ) 42.84 Balance outstanding at end of year 15,977 16.49 10,403 20.93 7,468 27.95 The Company expenses compensation costs are Year ended December 31, 2019 2018 2017 (U.S. $ in millions) Employee stock options $ 46 $ 74 $ 64 RSUs and PSUs 73 81 69 Total stock-based compensation expense 119 155 133 Tax effect on stock-based compensation expense 14 18 24 Net effect $ 105 $ 137 $ 109 A s of million, respectively. This cost is expected to be recognized over a weighted average period of approximately 1.9 years and 2.7 years, respectively. d. Dividends: Commencing in April 2015, dividends on Teva’s ordinary shares were declared in U.S. dollars. Dividends paid In addition, total dividends paid on Teva’s mandatory convertible preferred shares in the years ended December 31, 2019, 2018 and 2017 were $ , and $70 Teva has not paid dividends on Teva ordinary shares or ADSs since December 2017. e. Accumulated other comprehensive loss: The components of accumulated other Net Unrealized Gains/(Losses) Benefit Plans Foreign Available- for- sale securities Derivative Actuarial gains/(losses) service Total Balance, January 1, 201 7 (2,592 ) (7 ) (479 ) (81 ) (3,159 ) Other comprehensive income/(loss) before reclassifications 1,075 64 (167 ) (3 ) 969 Amounts reclassified to the statements of income 378 (66 ) 27 (5 ) 334 Net other comprehensive income/(loss) before tax 1,453 (2 ) (140 ) (8 ) 1,303 Corresponding income tax 5 — (2 ) 3 Net other comprehensive income/(loss) after tax* 1,453 3 (140 ) (10 ) 1,306 Balance, December 31, 2017 (1,139 ) (4 ) (619 ) (91 ) (1,853 ) Cumulative effect of new accounting standard ** — 5 — — 5 Other comprehensive income/(loss) before reclassifications (739 ) (1 ) 87 4 (649 ) Amounts reclassified to the statements of income 1 28 13 42 Net other comprehensive income/(loss) before tax (739 ) — 115 17 (607 ) Corresponding income tax — — (4 ) (4 ) Net other comprehensive income/(loss) after tax* (739 ) — 115 13 (611 ) Balance, December 31, 2018 (1,878 ) 1 (504 ) (78 ) (2,459 ) Other comprehensive income/(loss) before reclassifications 84 (1 ) 54 (11 ) 126 Amounts reclassified to the statements of income 30 (10 ) 20 Net other comprehensive income/(loss) before tax 84 (1 ) 84 (21 ) 146 Corresponding income tax — — — 1 1 Net other comprehensive income/(loss) after tax* 84 (1 ) 84 (20 ) 147 Balance, December 31, 2019 (1,794 ) — (420 ) (98 ) (2,312 ) * Amounts do not include foreign currency translation adjustments attributable to non-controlling 9 gain 8 7 . ** Following the adoption of ASU 2016-01, the Company recorded a $5 million opening balance reclassification from accumulated other comprehensive income to retained earnings. |
Other assets impairments, restr
Other assets impairments, restructuring and other items | 12 Months Ended |
Dec. 31, 2019 | |
Other assets impairments, restructuring and other items | NOTE 15—Other assets impairments, restructuring and other items: Year ended December 31, 2019 2018 2017 (U.S. $ in millions) Impairment of long-lived tangible assets $ 139 $ 500 $ 544 Contingent consideration (see note 2 0 59 57 154 Acquisition, integration and related costs — 13 105 Restructuring 199 488 535 Venezuela deconsolidation charge (see note 1) — — 396 Other 26 (71 ) 102 Total $ 423 $ 987 $ 1,836 (1) Including impairments related to exit and disposal activities Following Teva’s two-year Impairments Impairments of tangible assets for the years ended on December 31, 2019, 2018 and 2017 were $139 million $500 million, and $544 million, respectively . Contingent consideration In 2019, Teva recorded $59 million of contingent consideration expenses, compared to $57 million and $154 million and 2017 , r were to a change in the estimated future royalty payments from Eagle in connection with bendamustine sales and an increase in the expected future royalty payments to Eagle due to the orphan drug status granted to BENDEKA ® , offset by the change in future royalty payments in connection with lenalidomide (generic equivalent of Revlimid ® ), which was part of the Actavis Generics acquisition. Restructuring In 2019, Teva recorded $199 million of restructuring expenses, compared to $488 million in 2018 and $535 million in 2017. In December 2017, Teva announced a comprehensive two-year Since the announcement of its restructuring plan, Teva reduced its global headcount by approximately 13,000 The following tables provide the components of costs associated with Teva’s restructuring plan, including other costs associated with Teva’s restructuring plan and recorded under different items: Year ended December 31, 201 9 201 8 201 7 (U.S. $ in millions) Restructuring $ 159 $ 410 $ 443 40 78 92 Total $ 199 $ 488 $ 535 The following table provides the components of and changes in the Company’s restructuring accruals: Employee Other Total (U.S. $ in millions) Balance as of January 1, 201 8 $ (294 ) $ (17 ) $ (311 ) Provision (410 ) (78 ) (488 ) Utilization and other* 500 66 566 Balance as of December 31, 201 8 $ (204 ) $ (29 ) $ (233 ) Provision (159 ) (40 ) (199 ) Utilization and other* 155 62 217 Balance as of December 31, 201 9 $ (208 ) $ (7 ) $ (215 ) * Includes adjustments for foreign currency translation. Significant regulatory events In July 2018, the FDA completed an inspection of Teva’s manufacturing plant in Davie, Florida in the United States, and issued a Form FDA-483 is In July 2018, Teva announced the voluntary recall of valsartan and certain combination valsartan medicines in various countries due to the detection of trace amounts of a previously unknown nitrosamine impurity called NDMA found in valsartan API supplied to it by Zhejiang Huahai Pharmaceutical Co., Ltd. (“Huahai”). Since July 2018, Teva has been actively engaged with regulatory agencies around the world in reviewing its sartan and other products to determine whether NDMA and/or other related nitrosamine impurities are present in specific products. Where necessary, Teva has initiated additional voluntary recalls. The aggregate direct impact of this recall on Teva’s 2018 and 2019 financial statements was $54 million, primarily related to inventory write-downs and returns. As a result of this loss, Teva initiated negotiations with Huahai and in December 2019, Teva reached a settlement with Huahai resolving its claims related to certain sartan API Huahai supplied to Teva. Under the settlement agreement, Huahai agreed to compensate Teva for some of the direct losses suffered by Teva and provide Teva prospective cost reductions for API. The settlement does not release Huahai from liability for any losses Teva may incur as a result of third party personal injury or product liability claims relating to the sartan API at issue. In addition, multiple lawsuits have been filed in connection with this matter, which may lead to additional customer penalties, impairments and litigation costs. Teva expects additional expenses and loss of revenues and profits in connection with this matter going forward. |
Other income
Other income | 12 Months Ended |
Dec. 31, 2019 | |
Other income | NOTE 16 — Other income: Year ended December 31, 2019 2018 2017 (U.S. $ in millions) Gain on divestitures, net of divestitures related costs (1) $ 50 67 1,083 Section 8 and similar payments (2) 5 195 83 Gain ( loss) (1 ) 9 11 Other, net 22 20 22 Total other income $ 76 $ 291 $ 1,199 (1) Mainly related to the divestment of several activities in the International Markets segment. (2) Section 8 of the Patented Medicines (Notice of Compliance) Regulation relates to recoveries of lost revenue related to patent infringement proceedings in Canada. |
Financial expenses-net
Financial expenses-net | 12 Months Ended |
Dec. 31, 2019 | |
Financial Expenses-Net | NOTE 17—Financial expenses — net: Year ended December, 31 2019 2018 2017 (U.S. $ in millions) Venezuela devaluation (1) $ — $ — $ 42 Interest expenses and other bank charges 881 920 875 Income from investments (41 ) (39 ) (84 ) Foreign exchange (gains) losses — net (15 ) 13 65 Other, net (2) (4 ) 65 (3 ) Total finance expense—net $ 822 $ 959 $ 895 (1) For further information regarding the Venezuela devaluation, refer to note 1a. (2) In 2018 , |
Earnings (Loss) per Share
Earnings (Loss) per Share | 12 Months Ended |
Dec. 31, 2019 | |
Earnings (Loss) per Share | NOTE 18—Earnings (loss) per share: The net income attributable to Teva and the weighted average number of ordinary shares used in the loss 2019 2018 2017 (U.S. $ in millions, except share data) Net income (loss) used for the computation of diluted loss $ (999 ) $ (2,399 ) $ (16,525 ) Weighted average number of shares used in the computation of basic loss 1,091 1,021 1,016 Add: Weighted average number of shares used in the computation of diluted loss 1,091 1,021 1,016 Basic earnings and loss per share are computed by dividing net results attributable to Teva’s ordinary shareholders by the weighted average number of ordinary shares outstanding (including fully vested restricted share units (“RSUs”)) during the period, net of treasury shares. In computing dilutive loss per share for the years ended December 31, 2019, 2018 and 2017 , 51 million and 38 million weighted average shares, respectively, and convertible senior debentures, since they had an anti-dilutive effect on loss Additionally, in computing dilutive loss |
Segments
Segments | 12 Months Ended |
Dec. 31, 2019 | |
Segments | NOTE 19 — Segments: Teva operates its business and reports its financial results in three (a) North America segment, which includes the United States and Canada. (b) Europe segment, which includes the European Union and certain other European countries. (c) International Markets segment, which includes all countries other than those in the North America and Europe segments. The Company began reporting its financial results under this structure in the first quarter of 2018. This change was reflected through retroactive recasting period segment information. In addition to these three segments, Teva has other sources of revenues, primarily the sale of APIs to third parties, certain contract manufacturing services and an out-licensing Teva’s Chief Executive Officer (“CEO”), who is the chief operating decision maker (“CODM”), reviews financial information prepared on a consolidated basis, accompanied by disaggregated information about revenues and contributed profit by the three identified reportable segments, namely North America, Europe and International Markets, to make decisions about resources to be allocated to the segments and assess their performance. Segment profit is comprised of gross profit for the segment less R&D expenses, S&M expenses, G&A expenses and other income related to the segment. Segment profit does not include amortization and certain other items. Teva manages its assets on a company basis, not by segments, as many of its assets are shared or commingled. Teva’s CODM does not regularly review asset information by reportable segment and, therefore, Teva does not report asset information by reportable segment. Teva’s CEO may review its strategy and organizational structure. Any changes in strategy may lead to a reevaluation of the Company’s segments and goodwill allocation to reporting units, as well as fair value attributable to its reporting units. See note 7. a. Segment information: Year ended December 31, 2019 North Europe International * (U.S. $ in millions) Revenues $ 8,542 $ 4,795 $ 2,246 Gross profit 4,350 2,704 1,167 R&D expenses 652 262 88 S&M expenses 1,021 890 481 G&A expenses 439 239 138 Other income (14 ) (5 ) (3 ) Segment profit $ 2,252 $ 1,318 $ 464 Year ended December 31, 2018 North America Europe International Markets * (U.S. $ in millions) Revenues $ 9,297 $ 5,186 $ 2,422 Gross profit 4,979 2,884 1,254 R&D expenses 713 283 96 S&M expenses 1,154 1,003 518 G&A expenses 484 325 153 Other income (209 ) — (11 ) Segment profit $ 2,837 $ 1,273 $ 498 Year ended December 31, 2017 North America Europe International Markets* (U.S. $ in millions) Revenues $ 12,141 $ 5,466 $ 2,863 Gross profit 7,322 2,887 1,433 R&D expenses 969 390 154 S&M expenses 1,288 1,130 672 G&A expenses 533 354 189 Other income (92 ) (16 ) (8 ) Segment profit $ 4,624 $ 1,029 $ 426 * The data presented for prior periods have been revised to reflect a revision in the presentation of net revenues and cost of sales in the consolidated financial statements. See note 1b. Year ended December 31, 2019 2018 2017 (U.S. North America profit $ 2,252 $ 2,837 $ 4,624 Europe profit 1,318 1,273 1,029 International Markets profit 464 498 426 Total reportable 4,034 4,608 6,079 Profit (loss) of other activities 108 115 (6 ) Total segments profit 4,142 4,723 6,073 Amounts not allocated to segments: Amortization 1,113 1,166 1,444 Other asset impairments, restructuring and other items 423 987 1,836 Goodwill impairment — 3,027 17,100 Intangible asset impairments 1,639 1,991 3,238 Gain on divestitures, net of divestitures related costs (50 ) (66 ) (1,083 ) Inve nto r y St ep up — — 67 Other R&D expenses (15 ) 83 221 Costs related to regulatory actions taken in facilities 45 14 47 Legal settlements and loss contingencies 1,178 (1,208 ) 500 Other unallocated amounts 252 366 187 Consolidated operating income (loss) (443 ) (1,637 ) (17,484 ) Financial expenses, net 822 959 895 Consolidated income (loss) before income taxes $ (1,265 ) $ (2,596 ) $ (18,379 ) North America segment: Year ended December 31, 2019 2018 2017 (U.S. $ in millions) Generic products $ 3,963 $ 4,056 $ 5,203 COPAXONE 1,017 1,759 3,116 BENDEKA/TREANDA 496 642 656 ProAir* 274 397 501 QVAR 250 182 313 AJOVY 93 3 — AUSTEDO 412 204 24 Anda 1,492 1,347 1,153 Other 546 708 1,175 Total $ 8,542 $ 9,297 $ 12,141 * Does not include revenues from the ProAir authorized generic, which are included under generic products. Europe segment: Year ended December 31, 2019 2018 2017 (U.S. $ in millions) Generic products $ 3,470 $ 3,593 $ 3,471 COPAXONE 432 535 595 Respiratory products 354 402 368 Other 539 656 1,033 Total $ 4,795 $ 5,186 $ 5,466 International Markets segme n Year ended December 31, 2019 2018 2017 (U.S. $ in millions) Generic products $ 1,893 $ 2,022 $ 2,370 COPAXONE 63 72 91 Distributio n 20 19 17 Other 271 309 385 Total $ 2,246 $ 2,422 $ 2,863 * The data presented for prior periods have been revised to reflect a revision in the presentation of net revenues and cost of sales in the consolidated financial statements. See note 1b. Teva revenues from external customers attributed to Israel were less than 5% of the consolidated revenues in the years ended December 31, 2019, 2018 and 2017, respectively. c. Supplemental data — major customers: The following table represents the percentage of consolidated third party net sales to Teva’s major customers during the years ended December 31, 2019, 2018 and 2017. Percentage of Third Party Net Sales 2019 2018 2017 McKesson Corporation 13 % 12 % 16 % AmerisourceBergen Corporation 12 % 14 % 15 % Most of Teva’s revenues from these customers were generated d. Property, plant and equipment—by geographical location were as follows: December 31, 2019 2018 (U.S. $ in millions) Israel $ 1,670 $ 1,987 United States 864 950 Croatia 517 538 Germany 665 518 Czech republic 343 352 Hungary 330 343 Japan 177 188 Other 1,870 1,992 Total property, plant and equipment $ 6,436 $ 6,868 |
Fair Value Measurement
Fair Value Measurement | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Measurement | NOTE 20 — Fair value measurement: Financial items g December 31, 2019 Level 1 Level 2 Level 3 Total (U.S. $ in millions) Cash and cash equivalents: Money markets $ 577 $ — $ — $ 577 Cash, deposits and other 1,398 — — 1,398 Investment in securities: Equity securities 42 — — 42 Other, mainly debt securities 2 — 12 14 Derivatives: Asset derivatives — options and forward contracts — 32 — 32 Liabilities derivatives — options and forward contracts — (41 ) — (41 ) Liabilities derivatives — interest rate and cross-currency swaps — (22 ) — (22 ) Contingent consideration* — — (460 ) (460 ) Total $ 2,019 $ (31 ) $ (448 ) $ 1,540 December 31, 2018 Level 1 Level 2 Level 3 Total (U.S. $ in millions) Cash and cash equivalents: Money markets $ 203 $ — $ — $ 203 Cash, deposits and other 1,579 — — 1,579 Investment in securities: Equity securities 51 — — 51 Other, mainly debt securities 2 — 10 12 Derivatives: Asset derivatives — options and forward contracts — 18 — 18 Asset derivatives — cross-currency swaps — 58 — 58 Liability derivatives — options and forward contracts — (26 ) — (26 ) Liabilities derivatives — interest rate and cross-currency swaps — (50 ) — (50 ) Contingent consideration* — — (507 ) (507 ) Total $ 1,835 $ — $ (497 ) $ 1,338 * Contingent consideration represents liabilities recorded at fair value in connection with acquisitions. Teva determined the fair value of the liability for the contingent consideration based on a probability-weighted discounted cash flow analysis. This fair value measurement is based on significant unobservable inputs in the market and thus represents a Level 3 measurement within the fair value hierarchy. The fair value of the contingent consideration is based on several factors, such as: the cash flows projected from the success of unapproved product candidates; the probability of success of product candidates, including risks associated with uncertainty regarding achievement and payment of milestone events; the time and resources needed to complete the development and approval of product candidates; the life of the potential commercialized products and associated risks of obtaining regulatory approvals in the United States and Europe ; The contingent consideration is evaluated quarterly or more frequently if circumstances dictate. Changes in the fair value of contingent consideration are recorded in earnings. Significant changes in unobservable inputs, mainly the probability of success and cash flows projected, could result in material changes to the contingent consideration liability. The following table summarizes the activity for those financial assets and liabilities where fair value measurements are estimated utilizing Level 3 inputs . December 31, 2019 December 31, 2018 (U.S. $ in millions) Fair value at the beginning of the period $ (497 ) $ (717 ) Investment in debt securities 2 (8 ) Adjustments to provisions for contingent consideration: Actavis Generics transaction 92 — Labrys acquisition — (17 ) Eagle transaction (151 ) (40 ) Settlement of contingent consideration: Labrys acquisition — 151 Eagle transaction 106 134 Fair value at the end of the period $ (448 ) $ (497 ) Teva’s financial instruments consist mainly of cash and cash equivalents, investments in securities, current and non-current The fair value of the financial instruments included in working capital and non-current Financial instruments not measured at fair value Financial instruments measured on a basis other than fair value consist of senior notes and convertible senior debentures (see note 9), and are presented in the below table in terms of fair value: Estimated fair value* December 31, 2019 2018 (U.S. $ in millions) Senior notes included under long-term liabilities $ 22,686 $ 23,560 Senior notes and convertible senior debentures included under short-term liabilities 2,318 2,140 Fair value at the end of the period $ 25,004 $ 25,700 * |
Long-term Employee-related Obli
Long-term Employee-related Obligations | 12 Months Ended |
Dec. 31, 2019 | |
Long-term Employee-related Obligations | NOTE 21—Long-term employee-related obligations: a. Long-term employee-related obligations consisted of the following: December 31, 2019 2018 (U.S. $ in millions) Accrued severance obligations $ 76 $ 75 Defined benefit plans 165 146 Total $ 241 $ 221 As of December 31, 2019 and 2018, Teva and Most of the change resulted from actuarial updates, as well as from exiting from several defined benefit plans in several countries. The Company expects to expense an approximate contribution of $116 million in 2020 to pension funds and insurance companies in connection wit h The main terms of the different arrangements with employees are described in below. b. Terms of arrangements: Israel Israeli law generally requires payment of severance pay upon dismissal of an employee or upon termination of employment in certain other circumstances. The Parent Company and its Israeli subsidiaries make ongoing deposits into employee pension plans to fund their severance liabilities. Generally, employees that joined the Company after 2005, have signed an arrangement, pursuant to which such deposits are made in lieu of the Company’s severance liability. Therefore, no obligation is provided for in the financial statements. Severance pay liabilities with respect to employees who were employed by the Parent Company and its Israeli subsidiaries prior to that date, as well as employees who have special contractual arrangements, are provided for in the financial statements based upon the number of years of service and the latest monthly salary of such employees. Europe Many of the employees in the Company’s European subsidiaries are entitled to a retirement grant when they leave the Company. In the consolidated financial statements, the liability of the European subsidiaries is accrued, based on the length of service and remuneration of each employee at the balance sheet date. Other employees in Europe are entitled to a pension according to a defined benefit scheme providing benefits based on final or average pensionable pay or according to a hybrid pension scheme that provides retirement benefits on a defined benefit and a defined contribution basis. Independent certified actuaries value these schemes and determine the rates of contribution payable. Pension costs for the defined benefit section of the scheme are accounted for on the basis of charging the expected cost of providing pensions over the period during which the subsidiaries benefit from the employees’ services. The Company uses December 31 as the measurement date for defined benefit plans. North Americ a The Company’s North American subsidiaries mainly provi de Latin Americ a The majority of the employees in Latin America are entitled to severance under local law. The severance payments are calculated based on service term and employee remuneration, and accruals are maintained to reflect these amounts. In some Latin American countries it is Teva’s practice to offer retirement health benefits to qualifying employees. Based on the specific plan requirements, benefits accruals are maintained to reflect the estimated amounts or adjusted if future plans are modified. The Company expects to pay the following future minimum benefits to its employees: $7 million in 2020; $7 million in 2021; $7 million in 2022; $7 million in 2023; $7 million in 2024 and $41 million in the aggregate 2025 2029 |
Selected Quarterly Financial Da
Selected Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2019 | |
Selected Quarterly Financial Data (Unaudited) | NOTE 22 – Selected quarterly financial data (unaudited ): The following table presents selected unaudited quarterly financial data for 201 9 8 2019 4th quarter 3rd quarter 2nd quarter 1st quarter (U.S $ in millions except per share amounts) Net revenues * 4,468 4,093 4,177 4,149 Gross profit 1,958 1,830 1,893 1,856 Net income (loss) 75 (307 ) (671 ) (97 ) Net income (loss) attributable to Teva 110 (314 ) (689 ) (105 ) Net income (loss) attributable to ordinary shareholders 110 (314 ) (689 ) (105 ) Earnings per share attributable to ordinary shareholders: Basic 0.10 (0.29 ) (0.63 ) (0.10 ) Diluted 0.10 (0.29 ) (0.63 ) (0.10 ) 2018 4th quarter 3rd quarter 2nd quarter 1st quarter (U.S $ in millions except per share amounts) Net revenues * 4,419 4,385 4,552 4,916 Gross profit 1,971 1,977 2,033 2,315 Net income (loss) (3,243 ) (197 ) (166 ) 1,134 Net income (loss) attributable to Teva (2,886 ) (208 ) (176 ) 1,120 Net income (loss) attributable to ordinary shareholders (2,940 ) (273 ) (241 ) 1,055 Earnings per share attributable to ordinary shareholders: Basic (2.85 ) (0.27 ) (0.24 ) 1.04 Diluted (2.85 ) (0.27 ) (0.24 ) 1.03 * The data presented for prior periods have been revised to reflect a revision in the presentation of net revenues and cost of sales in the consolidated financial statements. See table below and not e The following table summarizes the impact of the revision on net revenues and cost of sales in the consolidated statement of income for the relevant periods: Net revenues Cost of sales As reported Adjustment As revised As reported Adjustment As revised (U.S. $ in millions) 2018 Q1 5,065 (149 ) 4,916 2,750 (149 ) 2,601 Q2 4,701 (150 ) 4,552 2,668 (150 ) 2,518 Q3 4,529 (143 ) 4,385 2,552 (143 ) 2,409 Q4 4,559 (141 ) 4,419 2,588 (141 ) 2,447 2019 Q1 4,295 (146 ) 4,149 2,440 (146 ) 2,293 Q2 4,337 (159 ) 4,177 2,443 (159 ) 2,284 Q3 4,264 (171 ) 4,093 2,435 (171 ) 2,264 |
Subsequent event
Subsequent event | 12 Months Ended |
Dec. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 23 – Subsequent event: In September 2017, we entered into a partnership agreement with Nuvelution for the development of AUSTEDO for the treatment of Tourette syndrome in pediatric patients in the United States. See note 2. On February 19, 2020, we received results for these clinical trials, which found that the clinical trials failed to meet their primary endpoints. As a result, we will incur an intangible asset impairment of $211 million in the first quarter of 2020. |
Schedule of Valuation and Quali
Schedule of Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2019 | |
Schedule of Valuation and Qualifying Accounts | Column A Column B Column C Column D Column E Balance at Charged to costs Charged to other Deductions Balance at end of Allowance for doubtful accounts: Year ended December 31, 2019 $ 232 $ (16 ) $ — $ (7 ) $ 209 Year ended December 31, 2018 $ 232 $ 13 $ (9 ) $ (4 ) $ 232 Year ended December 31, 2017 $ 191 $ 12 $ 51 $ (22 ) $ 232 Allowance in respect of carryforward tax losses and deductions that may not be utilized: Year ended December 31, 2019 $ 1,633 $ 555 $ — $ (214 ) $ 1,974 Year ended December 31, 2018 $ 1,504 $ 407 $ 5 $ (283 ) $ 1,633 Year ended December 31, 2017 $ 1,690 $ 173 $ 390 $ (749 ) $ 1,504 |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
General | a. General: Operations Teva Pharmaceutical Industries Limited (the “Parent Company”), headquartered in Israel, together with its subsidiaries and associated companies (the “Company,” “Teva” or the “Group”), is engaged in the development, manufacturing, marketing and distribution of generics, specialty medicines and biopharmaceuticals. The majority of the Group’s revenues are in the United States and Europe. Basis of presentation and use of estimates The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). In preparing the Company’s consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reported years. Actual results could differ from those estimates. As applicable to these consolidated financial statements, the most significant estimates and assumptions relate to determining the valuation and recoverability of intangible assets and goodwill; assessing sales reserves and allowances, and contingent consideration; assessing compliance with debt covenants; uncertain tax positions, valuation allowances, contingencies, inventory valuation and restructuring. Accounting for Venezuelan Operations Until November 30, 2017, the financial position and results of operations of Teva’s Venezuelan business, conducted through a number of wholly-owned subsidiaries, were included in Teva’s consolidated financial statements and reported under highly-inflationary accounting principles, with the functional currency of the U.S. dollar. Effective November 30, 2017, Teva deconsolidated its Venezuelan subsidiaries and began accounting for its investments in its Venezuelan operations using the cost method of accounting under the measurement alternative. The estimated fair value of the investments was immaterial based on expected future cash flow, considering ongoing hyper-inflation and economic and political uncertainty in Venezuela. The assigned values are considered Level 3 measurements within the fair value hierarchy. Teva’s financial results include sales of finished goods to the Venezuelan subsidiaries, to the extent cash payments are received from these subsidiaries, while cost of sales is recorded when goods are imported to Venezuela. The Venezuelan subsidiaries’ results were immaterial in terms of assets, liabilities, operating results and cash flows for the eleven months ended November 30, 2017. Upon assessing the facts as of December 31, 2019, Teva continues to believe its previous conclusion regarding its lack of control or significant influence over its Venezuelan operations is appropriate. Teva will continue to monitor the conditions in Venezuela and their impact on its prospective accounting treatment and related disclosures. Functional currency A major part of the Group’s operations is carried out by the Company in the United States, Israel and certain other countries. The functional currency of these entities is the U.S. dollar (“dollar” or “$”). The functional currency of certain subsidiaries and associated companies is their local currency. The financial statements of those companies are included in the consolidated financial statements, translated into U.S. dollars. Assets and liabilities are translated at year-end In the event of a divestiture of a foreign subsidiary, the related foreign currency translation results are reversed from equity to income. Foreign currency exchange gains and losses are included in net income (loss). Principles of consolidation The consolidated financial statements include the accounts of the Company and its majority-owned subsidiaries and VIEs for which the Company is considered the primary beneficiary. For those consolidated subsidiaries where Teva owns less than 100%, the outside shareholders’ interests are shown as non-controlling For VIEs, the Company performs an analysis to determine whether the variable interests give a controlling financial interest in a VIE. The Company periodically reassesses whether it controls its VIEs. Intercompany transactions and balances are eliminated on consolidation; profits from intercompany sales, not yet realized outside the Group, are also eliminated. |
Revision of Previously Reported Consolidated Financial Statements | b. Revision of Previously Reported Consolidated Financial Statements In connection with the preparation of Teva’s consolidated financial statements for the fiscal year ended December 31, 2019, Teva determined that in the full years and interim periods of fiscal years 2017 and 2018, and the first three quarters of fiscal year 2019, it had an immaterial error in the presentation of distribution revenues from its Israeli distribution business. This business is part of the International Markets reporting segment and facilitates distribution of Teva and third party products to pharmacies, hospitals and other organizations in Israel. Specifically, the Company concluded that it presented revenue from its Israeli distribution business on a gross basis, although it should have reported such revenue on a net basis. Because Teva has no discretion in establishing prices for any specifies goods or services, limited inventory risk and is not primarily responsible for contract fulfillment, Teva does not meet the criteria for reporting revenues from such business as a principal (on a gross basis), as opposed to as an agent (on a net basis). The Company evaluated the cumulative impact of this item on its previously issued annual financial statements for 2017 and 2018, and the interim financial statements for 2017, 2018 and the first three quarters of 2019, and concluded that, for the reasons mentioned below, the revisions were not material, individually or in the aggregate, to any of its previously-issued interim or annual financial statements. Teva has revised its presentation of net revenue and cost of sales in the historical consolidated financial statements to reflect the change in this item, as described in more detail below. The impact of this revision is a decrease in net revenues with an offsetting decrease in cost of sales. There is no impact on gross profit, operating income or earnings per share. In addition, there is no impact on Teva’s balance sheet or statement of cash flows for the related periods. The following table summarizes the impact of the revision on net revenues and cost of sales in the consolidated statements of income in the relevant periods: Net revenues Cost of sales As reported Adjustment As revised As reported Adjustment As revised (U.S. $ in millions) 2017 22,385 (533 ) 21,853 11,770 (533 ) 11,237 2018 18,854 (583 ) 18,271 10,558 (583 ) 9,975 |
New accounting pronouncements | c. New accounting pronouncements Recently adopted accounting pronouncements In June 2018, the FASB issued ASU 2018-07 non-employee In August 2017, the FASB issued ASU 2017-12 non-financial In February 2016, the FASB issued ASU 2016-02 right-of-use Teva adopted the new lease standard and all the related amendments on January 1, 2019 and used the effective date as Teva’s date of initial application. Consequently, financial information was not updated and the disclosures required under the new standard are not provided for dates and periods before January 1, 2019. The new lease standard provides a number of optional practical expedients in transition. Teva did not elect the ‘package of practical expedients,’ which permits the Company not to reassess its prior conclusions regarding lease identification, lease classification and initial direct costs under the new standard. However, the Company did elect the practical expedient pertaining to the use of hindsight. The new lease standard also provides practical expedients for an entity’s ongoing accounting. Teva elected the short-term lease recognition exemption for all leases with a term shorter than 12 months. This means, for those leases, Teva does not recognize ROU assets or lease liabilities, including not recognizing ROU assets or lease liabilities for existing short-term leases of those assets in transition. Teva also elected the practical expedient to not separate lease and non-lease Additionally, following the adoption of the new lease standard and in subsequent measurements, Teva applies the portfolio approach to account for the operating lease ROU assets and liabilities for certain car leases and incremental borrowing rates. The adoption of this standard has a material effect on Teva’s financial statements. The most significant impact is reflected in: (i) effective as of January 1, 2019, the recognition of approximately $553 million ROU assets and $561 million lease liabilities on Teva’s balance sheet for its operating leases of real estate, vehicles and equipment (the difference between the additional lease assets and lease liabilities did not have material impact on the retained earnings), and (ii) the requirement to provide significant new disclosures regarding Teva’s leasing activities and to enable users of financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. However, the adoption of this standard does not have a significant impact on Teva’s consolidated statements of income and consolidated statements of cash flows. Also, the Company’s accounting for finance leases remained substantially unchanged. See note 8 and note 1 dd Recently issued accounting pronouncements, not yet adopted In December 2019, the FASB issued ASU 2019-12 year-to-date In addition, this Update also simplifies the accounting for income taxes in certain topics as follows: (1) requiring that an entity recognize a franchise tax (or similar tax) that is partially based on income as an income-based tax and account for any incremental amount incurred as a non-income-based In April 2019, the FASB issued ASU 2019-04 In November 2018, the FASB issued ASU 2018-18 unit-of-account after December 15, 2019. Early adoption is permitted and should be applied retrospectively. The adoption of this guidance will not have a significant impact on the Company’s consolidated financial statements. In August 2018, the FASB issued ASU 2018-15 other—Internal-use 350-40): internal-use In August 2018, the FASB issued ASU 2018-13 In June 2016, the FASB issued ASU 2016-13 |
Acquisitions | d Acquisitions: Teva’s consolidated financial statements include the operations of acquired business es Contingent consideration incurred in a business combination is included as part of the acquisition price and recorded at a probability weighted assessment of its fair value as of the acquisition date. The fair value of the contingent consideration is re-measured |
Collaborative arrangements | e. Collaborative arrangements: Collaborative agreements are contractual arrangements in which the parties are active participants to the arrangement and are exposed to the significant risks and rewards that are dependent on the ultimate commercial success of the endeavor. The Company recognizes revenue generated and costs incurred on sales to third parties as it relates to collaborative agreements as gross or net. If the Company is the principal participant in a transaction, revenues and costs are recorded on a gross basis; otherwise, revenues are recorded on a net basis. f. Equity investments: |
Equity investments | The Company measures equity investments at fair value with changes in fair value recognized in net income. The Company accounts for equity investments that do not have a readily determinable fair value as cost method investments under the measurement alternative prescribed within ASU 2016-01 |
Fair value measurement | g. Fair value measurement: The Company measures fair value and discloses fair value measurements for financial assets and liabilities. Fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The accounting standard establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. Level 2: Observable inputs that are based on inputs not quoted on active markets, but corroborated by market data. Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible and considers counterparty credit risk in its assessment of fair value. |
Investment in debt securities | h. Investment in debt securities: Investment in securities consists of debt securities classified as available-for-sale Unrealized gains of available for sale debt securities, net of taxes, are reflected in other comprehensive income. Unrealized losses considered to be temporary are reflected in other comprehensive income; unrealized losses that are considered to be other-than-temporary are charged to income as an impairment charge. Realized gains and losses for debt securities are included in financial expense, net. The Company considers available evidence in evaluating potential impairments of its investments, including the duration and extent to which fair value is less than cost. For debt securities, an other-than-temporary impairment has occurred if the Company does not expect to recover the entire amortized cost basis of the debt security. If the Company does not intend to sell the impaired debt security, and it is not more likely than not it will be required to sell the debt security before the recovery of its amortized cost basis, the amount of the other-than-temporary impairment recognized in earnings, recorded in financial expense, net, is limited to the portion attributed to credit loss. The remaining portion of the other-than-temporary impairment related to other factors is recognized in other comprehensive income. |
Cash and cash equivalents | i. Cash and cash equivalents: All highly liquid investments, which include short-term bank deposits and money market instruments, that are not restricted as to withdrawal or use, and investment in short-term debentures, the period to maturity of which did not exceed three months at the time of investment, are considered to be cash equivalents. |
Accounts receivables | j. Accounts receivables: Accounts receivables are stated at their net realizable value. The allowance against gross accounts receivables reflects the best estimate of losses inherent in the receivables portfolio determined on the basis of historical experience, specific allowances for known troubled accounts and other currently available information. An allowance for doubtful debts is reflected in net accounts receivables. Accounts receivables are written off after all reasonable means to collect the full amount have been exhausted. |
Concentration of credit risks | k Concentration of credit risks: Most of Teva’s cash and cash equivalents (which, along with investment in securities, totaled $2,030 million at December 31, 201 9 The pharmaceutical industry, particularly in the United States, has been significantly affected by consolidation among managed care providers, large pharmacy chains, wholesaling organizations and other buyer groups. The U.S. market constituted approximately 47% of Teva’s consolidated revenues in 201 9 outside the U.S. |
Inventories | l Inventories: Inventories are valued at the lower of cost or net realizable value. Cost of raw and packaging materials, purchased products, manufactured finished products, products in process and capitalized production costs are determined predominantly on a standard cost basis, approximating actual costs. Other methods which are utilized for determining the value of inventories are moving average, cost basis and the first in first out method. Teva regularly reviews its inventories for obsolescence and other impairment risks and reserves are established when necessary. Inventories acquired in a business combination are stepped-up |
Long-lived assets | m. Long-lived assets: Teva’s long-lived, non-current impairment indicators throughout the year. Impairment testing for goodwill and all indefinite - ved Goodwill Goodwill reflects the excess of the consideration transferred, including the fair value of any contingent consideration and any non-controlling The goodwill impairment test is performed according to the following principles: 1. An initial qualitative assessment may be performed to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount. 2. If the Company concludes it is more likely than not that the fair value of the reporting unit is less than its carrying mount, a quantitative fair value test is performed. An impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value is recognized. An interim goodwill impairment test may be required in advance of the annual impairment test if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. For example, a substantial decline in the Company’s market capitalization, unexpected adverse business conditions, economic factors and unanticipated competitive activities may indicate that an interim impairment test is required. In the event that the Company’s market capitalization declines below its book value, the Company considers the length and severity of the decline and the reason for the decline when assessing whether potential goodwill impairment exists. Identifiable intangible assets Identifiable intangible assets are comprised of definite life intangible assets and indefinite life intangible assets. Definite life intangible assets consist mainly of acquired product rights and other rights relating to products for which marketing approval was received from the U.S. Food and Drug Administration (“FDA”) or the equivalent agencies in other countries. These assets are amortized mainly using the straight-line method over their estimated period of useful life, or based on economic benefit models, if more appropriate, which is determined by identifying the period and manner in which substantially all of the cash flows are expected to be generated. Amortization of acquired developed products is recorded under cost of sales. Amortization of marketing and distribution rights is recorded under selling and marketing (“S&M”) expenses when separable. Indefinite life intangible assets are mainly comprised of IPR&D assets. Teva monitors these assets for items such as research and development milestones and progress to identify any triggering events. Teva determines the fair value of the asset annually or when triggering events are present, based on discounted cash flows and records an impairment loss if book value exceeds fair value. IPR&D acquired in a business combination is capitalized as an indefinite life intangible asset until the related research and development efforts are either completed or abandoned. In the reporting periods where they are treated as indefinite life intangible assets, they are not amortized but rather are monitored triggering events and tested for impairment. Upon completion of the related research and development efforts, management determines the useful life of the intangible assets and amortizes them accordingly. In case of abandonment or a reduction in the expected realizable value of the asset, the related research and development assets are impaired. Whenever impairment indicators are identified for definite life intangible assets, Teva reconsiders the asset’s estimated life, calculates the undiscounted value of the asset’s or asset group’s cash flows and compares such value against the asset’s or asset group’s carrying amount. If the carrying amount is greater, Teva records an impairment loss for the excess of book value over fair value based on the discounted cash flows. In determining the estimated fair value of identifiable intangible assets, Teva utilized a discounted cash flow model. The key assumptions within the model related to forecasting future revenue and operating income, an appropriate discount rate and an appropriate terminal value based on the nature of the long-lived asset. The Company’s updated forecasts of net cash flows for the impaired assets reflect, among others, the following: (i) for IPR&D assets, the impact of changes to the development programs, the projected development and regulatory timeframes and the risks associated with these assets; and (ii) for product rights, pricing and volume projections, as well as patent life and any significant changes to the competitive environment. Property, plant and equipment Property, plant and equipment are stated at cost, after deduction of the related investment grants, and depreciated using the straight-line method over the estimated useful life of the assets: buildings, mainly 40 years; machinery and equipment, mainly between 15 to 20 years; and other assets, between 5 to 10 years. For property, plant and equipment and l right-of-use Lease right-of-use See notes 1c, 1dd and 8 for further discussion. |
Contingencies | n. Contingencies: The Company is involved in various patent, product liability, commercial, government investigations, environmental claims and other legal proceedings that arise from time to time in the ordinary course of business. Except for income tax contingencies, contingent consideration, other contingent liabilities incurred or acquired in a business combination, Teva records accruals for these types of contingencies to the extent that Teva concludes their occurrence is probable and that the related liabilities are estimable. When accruing these costs, the Company will recognize an accrual in the amount within a range of loss that is the best estimate within the range. When no amount within the range is a better estimate than any other amount, the Company accrues for the minimum amount within the range. Teva records anticipated recoveries under existing insurance contracts that are probable of occurring at the gross amount that is expected to be collected. Legal costs are expensed as incurred. The Company recognizes gain contingencies when they are realized or when all related contingencies have been resolved. |
Treasury shares | o. Treasury shares: Treasury shares are presented as a reduction of Teva shareholders’ equity and carried at their cost to Teva, under treasury shares. |
Stock-based compensation | p Stock-based compensation: Teva recognizes stock based compensation for the estimated fair value of share-based awards, restricted share units (“RSUs”) and performance share units (“PSUs”). The compensation expense for PSUs is recognized only if it is probable that the performance condition will be achieved. Teva measures compensation expense for share-based awards based on estimated fair values on the date of grant using the Black-Scholes option-pricing model. This option pricing model requires estimates as to the option’s expected term and the price volatility of the underlying stock. Teva amortizes the value of share-based awards to expense over the vesting period on a straight-line basis. Teva measures compensation expense for the RSUs and PSUs based on the market value of the underlying stock at the date of grant, less an estimate of dividends that will not accrue to the RSU and PSU holders prior to vesting. |
Deferred income taxes | q. Deferred income taxes: Deferred income taxes are determined utilizing the “asset and liability” method based on the estimated future tax effects of temporary differences between the financial accounting and tax basis of assets and liabilities under the applicable tax laws, and on tax rates anticipated to be in effect when the deferred income taxes are expected to be paid or realized. A valuation allowance is provided if, based upon the weight of available evidence, it is more likely than not that a portion of the deferred income tax assets will not be realized. In determining whether a valuation allowance is needed, Teva considers all available evidence, including historical information, long range forecast of future taxable income and evaluation of tax planning strategies. Amounts recorded for valuation allowance can result from a complex series of judgments about future events and can rely on estimates and assumptions. Deferred income tax liabilities and assets are classified as non-current. Deferred tax has not been provided on the following items: 1. Taxes that would apply in the event of disposal of investments in subsidiaries, as it is generally the Company’s intention to hold these investments, not to realize them. The determination of the amount of related unrecognized deferred tax liability is not practicable. 2. Amounts of tax-exempt |
Uncertain tax positions | r Uncertain tax positions: Teva recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefit recognized in the financial statements for a particular tax position is based on the largest benefit that is more likely than not to be realized. Teva regularly re-evaluates Provisions for uncertain tax positions, whereas Teva has net operating losses to offset additional income taxes that would result from the settlement of the tax position, are presented as a reduction of the deferred tax assets for such net operating loss. |
Derivatives and hedging | s. Derivatives and hedging: The Group carries out transactions involving derivative financial instruments (mainly forward exchange contracts, currency options, cross-currency swap contracts, interest rate swap contracts and treasury locks). The transactions are designed to hedge the Company’s currency and interest rate exposures. The Company does not enter into derivative transactions for trading purposes. Derivative instruments are recognized on the balance sheet at their fair value. For derivative instruments that are designated and qualify as a fair value hedge, the gain or loss on the derivative instrument as well as the offsetting gain or loss on the hedged item attributable to the hedged risk is recognized in financial expenses—net in the statements of income in the period that the changes in fair value occur. For derivative instruments that are designated and qualify as a cash-flow hedge, the gain or loss on the derivative instrument is reported as a component of other comprehensive income and reclassified into earnings in the same line item associated with the anticipated transaction in the same period or periods during which the hedged transaction affects earnings. For derivative instruments that are designated as net-investment expenses-net. For derivative instruments that qualify for hedge accounting, the cash flows associated with these derivatives are reported in the consolidated statements of cash flows consistently with the classification of the cash flows from the underlying hedged items that these derivatives are hedging. Derivative instruments that do not qualify for hedge accounting are recognized on the Balance Sheet at their fair value, with changes in the fair value recognized as a component of financial expenses—net in the statements of income. The cash flows associated with these derivatives are reflected as cash flows from operating activities in the consolidated statements of cash flows. |
Revenue recognition | t Revenue recognition: The Company’s revenue recognition accounting policy until December 31, 2017, prior to the adoption of the new revenue standard The Company recognizes revenues from product sales, including sales to distributors when persuasive evidence of an arrangement exists, delivery has occurred, the selling price is fixed or determinable and collectability is reasonably assured. This generally occurs when products are shipped and title and risk and rewards for the products are transferred to the customer. Revenues from product sales are recorded net of provisions for estimated chargebacks, rebates, returns, prompt pay discounts and other deductions, such as shelf stock adjustments, which can be reasonably estimated. When sales provisions are not considered reasonably estimable by Teva, the revenue is deferred to a future period when more information is available to evaluate the impact. Provisions for chargebacks, rebates including Medicaid and other governmental program discounts and other promotional items, such as shelf stock adjustments, are included in sales reserves and allowances (“SR&A”). These provisions are recognized concurrently with the sales of products. Prompt payment discounts are netted against trade receivables. Calculations for these deductions from sales are based on historical experience and the specific terms in the individual agreements. Chargebacks and rebates are the largest components of sales reserves and allowances. Provisions for chargebacks are determined using historical chargeback experience and expected chargeback levels and wholesaler sales information for products, which are compared to externally obtained distribution channel reports for reasonableness. Rebates are recognized based on contractual obligations in place at the time of sales with consideration given to relevant factors that may affect the payment as well as historical experience for estimated market activity. Shelf-stock adjustments are granted to customers based on the existing inventory of a customer following decreases in the invoice or contract price of the related product and are estimated based on expected market performance. Teva records a reserve for estimated sales returns by applying historical experience of customer returns to the amounts invoiced and the amount of returned products to be destroyed versus products that can be placed back in inventory for resale. Revenue resulting from the achievement of milestone events stipulated in agreements is recognized when the milestone is achieved. Milestones are based on the occurrence of a substantive element specified in the contract or as a measure of substantive progress toward completion under the contract Revenues from licensees, sales of licensed products and technology are recorded in accordance with the contract terms, when third-party sales can be reliably measured and collection of the funds is reasonably assured. Royalty revenue is recognized as a component of net revenues in accordance with the terms of their respective contractual agreements when collectability is reasonably assured and when revenue can be reasonably measured. The Company’s revenue recognition accounting policy from January 1, 2018, following the adoption of the new revenue standard On January 1, 2018, Teva adopted the new revenue standard to all contracts using the modified retrospective method. The cumulative initial effect of applying the new revenue standard was immaterial. A contract with a customer exists only when: the parties to the contract have approved it and are committed to perform their respective obligations, the Company can identify each party’s rights regarding the distinct goods or services to be transferred (“performance obligations”), the Company can determine the transaction price for the goods or services to be transferred, the contract has commercial substance and it is probable that the Company will collect the consideration to which it will be entitled in exchange for the goods or services that will be transferred to the customer. Revenues are recorded in the amount of consideration to which the Company expects to be entitled in exchange for performance obligations upon transfer of control to the customer, excluding amounts collected on behalf of other third parties and sales taxes. The amount of consideration to which Teva expects to be entitled varies as a result of rebates, chargebacks, returns and other sales reserves and allowances (“SR&A”) that the Company offers to its customers and their customers, as well as the occurrence or nonoccurrence of future events, including milestone events. A minimum amount of variable consideration is recorded by the Company concurrently with the satisfaction of performance obligations to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. Estimates of variable consideration are based on historical experience and the specific terms in the individual agreements (which the Company believes approximates expected value). Rebates and chargebacks are the largest components of SR&A. If a minimum cannot be reasonably estimated, such revenue may be deferred to a future period when better information is available. For further description of SR&A components and how they are estimated, see “Variable Consideration” below. Shipping and handling costs, after control of the product has transferred to a customer, are accounted for as a fulfillment cost and are recorded under S&M expenses. Teva does not adjust the promised amount of consideration for the effects of a significant financing component since the Company expects, at contract inception, that the period between the time of transfer of the promised goods or services to the customer and the time the customer pays for these goods or services to be generally one year or less, based on the practical expedient. The Company’s credit terms to customers are, on average, between thirty The Company generally recognizes the incremental costs of obtaining contracts as an expense since the amortization period of the assets that the Company otherwise would have recognized is one year or less. The costs are recorded under S&M expenses. Similarly, Teva does not disclose the value of unsatisfied performance obligations for contracts with original expected duration of one year or less. Nature of revenue streams Revenue from sales of goods, including sales to distributors is recognized when the customer obtains control of the product. This generally occurs when products are shipped once the Company has a present right to payment and legal title, and risk and rewards of ownership are obtained by the customer. Licensing arrangements performance obligations generally include intellectual property (“IP”) rights, certain R&D and contract manufacturing services. The Company accounts for IP rights and services separately if they are distinct — i.e. if they are separately identifiable from other items in the arrangement and if the customer can benefit from them on their own or with other resources that are readily available to the customer. The consideration is allocated between IP rights and services based on their relative stand-alone selling prices. Revenue for distinct IP rights is accounted for based on the nature of the promise to grant the license. In determining whether the Company’s promise is to provide a right to access its IP or a right to use its IP, the Company considers the nature of the IP to which the customer will have rights. IP is either functional IP which has significant standalone functionality or symbolic IP which does not have significant standalone functionality. Revenue from functional IP is recognized at the point in time when control of the distinct license is transferred to the customer. Revenue from symbolic IP is recognized over the access period to the Company’s IP. Revenue from sales based milestones and royalties promised in exchange for a license of IP is recognized only when, or as, the later of subsequent sale or the performance obligation to which some or all of the sales-based royalty has been allocated, is satisfied. Revenues from licensing arrangements included royalty income of $147 million, $165 million and $327 million for the years ended December 31, 2019, 2018 and 2017, respectively. The amounts recognized in 2017 include royalty income resulting from the Ninlaro ® Distribution revenues are derived from sales of third-party products for which the Company acts as distributor, mostly in the United States via Anda and in Israel via Salomon Levin and Elstein Ltd. (SLE). In the United States, the Company is the principal in these arrangements and therefore records revenue on a gross basis as it controls the promised goods before transferring these goods to the customer. In Israel, the Company is the agent in these arrangements and therefore records revenue on a net basis as it has no discretion in establishing prices for any specifies goods or services, limited inventory risk and is not primarily responsible for contract fulfillment. See also section b above. Revenue is recognized when the customer obtains control of the products. This generally occurs when products are shipped once the Company has a present right to payment and legal title and risk and rewards of ownership are obtained by the customer. Other revenues are primarily comprised of contract manufacturing services, sales of medical devices and other miscellaneous items. Revenue is recognized when the customer obtains control of the products. This generally occurs when products are shipped once the Company has a present right to payment and legal title and risk and rewards of ownership are obtained by the customer. Contract assets and liabilities Contract assets are mainly comprised of trade receivables net of allowance for doubtful debts, which includes amounts billed and currently due from customers. Contract liabilities are mainly comprised of deferred revenues which were immaterial as of December 31, 2019 and 2018. Variable consideration Variable consideration mainly includes SR&A, comprised of rebates (including Medicaid and other governmental program discounts), chargebacks, returns and other promotional (including shelf stock adjustments) items. Provisions for prompt payment discounts are netted against trade receivables. The Company recognizes these provisions at the time of sale and adjusts them if the actual amounts differ from the estimated provisions. The following describes the nature of each deduction and how provisions are estimated: Rebates Rebates are primarily related to volume incentives and are offered to key customers to promote loyalty. These rebate programs provide that, upon the attainment of pre-established Medicaid and Other Governmental Rebates Pharmaceutical manufacturers whose products are covered by the Medicaid program are required to provide a rebate to each state as a percentage of their average manufacturer’s price for the products dispensed. Many states have also implemented supplemental rebate programs that obligate manufacturers to pay rebates in excess of those required under federal law. The Company estimates these rebates based on historical trends of rebates paid, as well as on changes in wholesaler inventory levels and increases or decreases in sales. Chargebacks The Company has arrangements with various third parties, such as managed care organizations and drug store chains, establishing prices for certain of Teva’s products. While these arrangements are made between the Company and the customers, the customers independently select a wholesaler from which they purchase the products. Alternatively, certain wholesalers may enter into agreements with the customers, with Teva’s concurrence, which establish the pricing for certain products which the wholesalers provide. Under either arrangement, Teva will issue a credit (referred to as a “chargeback”) to the wholesaler for the difference between the invoice price to the wholesaler and the customer’s contract price s s s Other Promotional Arrangements Other promotional or incentive arrangements are periodically offered to customers, specifically related to the launch of products or other targeted promotions. Provisions are made in the period for which the Company can estimate the incentive earned by the customer, in accordance with the contractual terms. The Company regularly monitors the provision for other promotional arrangements and makes adjustments when it believes that the actual provision may differ from the estimated provisions. Shelf Stock Adjustments The custom in the pharmaceutical industry is generally to grant customers a shelf stock adjustment based on the customers’ existing inventory contemporaneously with decreases in the market price of the related product. The most significant of these relate to products for which an exclusive or semi-exclusive period exists. Provisions for price reductions depend on future events, including price competition, new competitive launches and the level of customer inventories at the time of the price decline. Teva regularly monitors the competitive factors that influence the pricing of its products and customer inventory levels and adjust these estimates where appropriate. Returns Returns primarily relate to customer returns of expired products which, the customer has the right to return up to one year following the expiration date. Such returned products are destroyed and credits and/or refunds are issued to the customer for the value of the returns. Accordingly, no returned assets are recoded in connection with those products. The returns provision is estimated by applying a historical return rate to the amounts of revenue estimated to be subject to returns. Revenue subject to returns is estimated based on the lag time from time of sale to date of return. The estimated lag time is developed by analyzing historical experience. Additionally, The Company considers specific factors, such as estimated levels of inventory in the distribution channel, product dating and expiration, size and maturity of launch, entrance of new competitors, changes in formularies or packaging and any changes to customer terms, for determining the overall expected levels of returns. Prompt Pay Discounts Prompt pay discounts are offered to most customers to encourage timely payment. Discounts are estimated at the time of invoice based on historical discounts in relation to sales. Prompt pay discounts are almost always utilized by customers. As a result, the actual discounts do not vary significantly from the estimated amount. |
Research and development | u Research and development: Research and development expenses are charged to income as incurred. Participations and grants in respect of research and development expenses are recognized as a reduction of research and development expenses as the related costs are incurred, or as the related milestone is met. Upfront fees received in connection with cooperation agreements are deferred and recognized over the period of the applicable agreements as a reduction of research and development expenses. Advance payments for goods or services that will be used or rendered for future research and development activities are deferred. Such amounts are recognized as an expense as the related goods are delivered or the services are performed. Research and development in-process |
Shipping and handling costs | v Shipping and handling costs: Shipping and handling costs, which are included in S&M expenses, were $138 million, $159 million and $164 million for the years ended December 31, 2019, 2018 and 2017, respectively. |
Advertising costs | w Advertising costs: Advertising costs are expensed as incurred. Advertising costs for the years ended December 31, 2019, 2018 and 2017 were $213 million, $256 million and $318 million, respectively. |
Restructuring | x Restructuring: Restructuring provisions are recognized for the direct expenditures arising from restructuring initiatives, where the plans are sufficiently detailed and where appropriate communication to those affected has been made. Costs for one-time Contractual termination benefits are provided to employees when employment is terminated due to an event specified in the provisions of an existing plan or agreement. A liability is recorded and the expense is recognized when it is probable that employees will be entitled to the benefits and the amount is reasonably estimable. Special termination benefits arise when the Company offers, for a short period of time, to provide certain additional benefits to employees electing voluntary termination. A liability is recorded and the expense is recognized in the period the employees irrevocably accept the offer and the amount of the termination liability is reasonably estimable. |
Segment reporting | y. Segment reporting: The Company’s business includes three reporting segments based on three geographical areas: (a) North America segment, which includes the United States and Canada. (b) Europe segment, which includes the European Union and certain other European countries. (c) International Markets segment, which includes all countries in which Teva operates other than those in the North America and Europe segments. Each business segment manages the entire product portfolio in its region, including generics, specialty and over-the-counter In addition to these three segments, Teva has other sources of revenues, primarily the sale of APIs to third parties, certain contract manufacturing services and an out-licensing |
Earnings per share | z Earnings per share: Basic earnings per share are computed by dividing the net income attributable to ordinary shareholders by the weighted average number of ordinary shares (including fully vested RSUs and PSUs) outstanding during the year, net of treasury shares. In computing diluted earnings per share, basic earnings per share are adjusted to take into account the potential dilution that could occur upon: (i) the exercise of options and non-vested “if-converted” “if-converted” On December 17, 2018, the mandatory convertible preferred shares automatically converted into ordinary shares. As a result of this conversion, Teva issued 70.6 million ADSs. See note 14. |
Securitization | aa Securitization Teva accounts for transfers of certain of its trade receivable as sales when it has surrendered control over the related assets in accordance with ASC Topic 860 “Transfer and Servicing” of Financial Assets. Whether control has been relinquished requires, among other things, an evaluation of relevant legal considerations and an assessment of the nature and extent of the Company’s continuing involvement with the assets transferred. Assets obtained and liabilities incurred in connection with transfers reported as sales are initially recognized in the balance sheet at fair value. Refer to note 10f. |
Divestitures | bb Divestitures: The Company nets the proceeds on the divestitures of products with the carrying amount of the related assets and records gain or loss on sale within other income. Any contingent payments that are potentially due to the Company as a result of these divestitures are recorded when it is probable that a significant reversal of income will not occur, or in the case of a business, when such payments are realizable. For divestures of businesses, including divestitures of products that qualify as a business, the Company reflects the relative fair value of goodwill associated with the businesses in the determination of gain or loss on sale. |
Debt instruments | cc. Debt instruments Debt instruments are initially recognized at the fair value of the consideration received. Debt issuance costs are recorded on the consolidated balance sheet as a reduction of liability. They are subsequently recognized at amortized cost using the effective interest method. Debt may be considered extinguished when it has been modified and the terms of the new debt instruments and old debt instruments are “substantially different” (as defined in the debt modification guidance in ASC 470-50 non-current 470-50 |
Leases | dd. Leases The Company’s lease accounting policy until December 31, 2018, prior to the adoption of the new lease standard Teva leases real estate, cars and equipment for use in its operations, which are classified as operating leases. In addition to rent, the leases may require Teva to pay directly for fees, insurance, maintenance and other operating expenses. Rental expense for the year ended December 31, 2018 and the year were and $200 million The Company’s lease accounting policy from January 1, 2019, following the adoption of the new lease standard Teva adopted the new accounting standard ASC 842 “Leases” and all the related amendments on January 1, 2019 and used the effective date as Teva’s date of initial application. Teva determines if an arrangement is a lease at inception. Lease classification is governed by five criteria in ASC 842-10-25-2. If any of these five criteria is met, Teva classifies the lease as a finance lease. Otherwise, Teva classifies the lease as an operating lease. When determining lease classification, Teva’s approach in assessing two of the mentioned criteria is: (i) generally, 75% or more of the remaining economic life of the underlying asset is a major part of the remaining economic life of that underlying asset; and (ii) generally, 90% or more of the fair value of the underlying asset comprises substantially all of the fair value of the underlying asset. Operating leases are included in operating lease right-of-use ROU assets represent Teva’s right to use an underlying asset for the lease term and lease liabilities represent Teva’s obligation to make lease payments arising from the lease. Operating and finance lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. Teva uses its incremental borrowing rate based on the information available at the commencement date to determine the present value of the lease payments. For finance leases, Teva recognizes interest on the lease liability separately from amortization of the ROU assets in the statement of comprehensive income. For operating leases, lease expenses are recognized on a straight-line basis over the lease term. The new standard also provides practical expedients for an entity’s ongoing accounting. Teva elected the short-term lease recognition exemption for all leases with a term shorter than 12 months. This means that for those leases, Teva does not recognize ROU assets or lease liabilities, including ROU assets or lease liabilities for existing short-term leases of assets in transition, but recognizes lease expenses over the lease term on a straight line basis. Teva also elected the practical expedient to not separate lease and non-lease Lease terms will include options to extend or terminate the lease when it is reasonably certain that Teva will either exercise or not exercise the option to renew or terminate the lease. Teva’s lease agreements have remaining lease terms ranging from 1 year to 80 years. Some of these agreements include options to extend the leases for up to 15 years and some include options to terminate the leases immediately. Certain leases also include options to purchase the leased property. The depreciable life of leasehold improvements is limited by the expected lease term, unless there is a transfer of title or a purchase option for the leased asset reasonably certain of exercise. Some of Teva’s vehicle lease agreements include rental payments based on the actual usage of the vehicles and other lease agreements include rental payments adjusted periodically for inflation. Teva’s lease agreements do not contain any material residual value guarantees. The new Lease Standard will have no impact on Teva’s debt-covenant compliance under its RCF. Teva rents out or subleases certain assets to third parties, which has an immaterial impact on Teva’s consolidated financial statements. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of impact of the revision on net revenues and cost of sales in the consolidated statement of income | The following table summarizes the impact of the revision on net revenues and cost of sales in the consolidated statements of income in the relevant periods: Net revenues Cost of sales As reported Adjustment As revised As reported Adjustment As revised (U.S. $ in millions) 2017 22,385 (533 ) 21,853 11,770 (533 ) 11,237 2018 18,854 (583 ) 18,271 10,558 (583 ) 9,975 |
Certain transactions (Tables)
Certain transactions (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Major Classes of Assets and Liabilities Included as Held for Sale | The table below summarizes the major classes of assets included as held for sale as of December 31, 2019 and 2018: December 31, December 31, (U.S. $ in millions) Property, plant and equipment, net 98 92 Goodwill — 51 Adjustments of assets held for sale to fair value (11 ) (51 ) Total assets of the disposal group classified as held for sale in the consolidated balance sheets $ 87 $ 92 |
Revenue from contracts with c_2
Revenue from contracts with customers (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of disaggregates revenues by major revenue streams | The following table disaggregates Teva’s revenues by major revenue streams. For additional information on disaggregation of revenues, see note 19. Year ended December 31, 201 9 North Europe International Other Total (U.S. Sale of goods 6,941 4,770 2,045 754 14,510 Licensing arrangements 109 29 4 5 147 Distribution 1,492 2 20 — 1,514 Other § (6 ) 177 545 716 $ 8,542 $ 4,795 $ 2,246 $ 1,304 $ 16,887 Year ended December 31, 201 8 North Europe International Other Total (U.S. Sale of goods 7,838 5,153 2,151 739 15,881 Licensing arrangements 111 23 22 9 165 Distribution 1,347 7 19 — 1,373 Other 1 3 230 618 852 $ 9,297 $ 5,186 $ 2,422 $ 1,366 $ 18,271 Year ended December 31, 201 7 North Europe International Other Total (U.S. Sale of goods 10,706 5,244 2,558 748 19,256 Licensing arrangements 281 3 38 5 327 Distribution 1,153 214 17 — 1,384 Other 1 5 250 630 886 $ 12,141 $ 5,466 $ 2,863 $ 1,383 $ 21,853 § Represents an amount less than $1 million . |
Summary of Sales Reserves and Allowances | The changes in SR&A for third-party sales for the period ended December 31, 2018 and 2019 were as follows: Sales Reserves and Allowances Reserves Rebates Medicaid and Chargebacks Returns Other Total Total (U.S. $ in millions) Balance at January 1, 2018 $ 196 $ 3,077 $ 1,908 $ 1,849 $ 780 $ 267 $ 7,881 $ 8,077 Provisions related to sales made in current year period 514 6,572 1,284 10,206 442 417 18,899 $ 19,413 Provisions related to sales made in prior 3 (14 ) 24 — 28 (30 ) (62 ) $ (59 ) Credits and payments (538 ) (6,596 ) (1,850 ) (10,519 ) (606 ) (463 ) (19,942 ) $ (20,480 ) Translation differences — (33 ) (5 ) (6 ) (6 ) (15 ) (65 ) $ (65 ) Balance at December 31, 2018 $ 175 $ 3,006 $ 1,361 $ 1,530 $ 638 $ 176 $ 6,711 $ 6,886 Provisions related to sales made in current year 383 5,552 976 9,565 281 394 16,767 $ 17,150 Provisions related to sales made in prior — (92 ) (151 ) (17 ) 77 (6 ) (189 ) $ (189 ) Credits and payments (471 ) (5,570 ) (1,076 ) (9,736 ) (360 ) (392 ) (17,134 ) $ (17,605 ) Translation differences — (1 ) (1 ) 1 1 4 4 $ 4 Balance at December 31, 201 9 $ 87 $ 2,895 $ 1,109 $ 1,342 $ 637 $ 176 $ 6,159 $ 6,246 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Inventories | Inventories, net of reserves, consisted of the following: December 31, 2019 2018 (U.S. $ in millions) Finished products $ 2,504 $ 2,665 Raw and packaging materials 1,183 1,328 Products in process 583 590 Materials in transit and payments on account 151 148 $ 4,422 $ 4,731 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Property, Plant and Equipment, Net | Property, plant and equipment, net, consisted of the following: December 31, 2019 2018 (U.S. $ in millions) Machinery and equipment $ 5,385 $ 5,658 Buildings 2,839 3,133 Computer equipment and other assets 2,131 2,089 Assets under construction and payments on account 672 565 Land 323 351 11,350 11,796 Less—accumulated depreciation (4,914 ) (4,928 ) $ 6,436 $ 6,868 |
Identifiable Intangible Assets
Identifiable Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Identifiable Intangible Assets | Identifiable intangible assets consisted of the following: Gross carrying amount Accumulated Net carrying amount December 31, 2019 2018 2019 2018 2019 2018 (U.S. $ in millions) Product rights $ 19,663 $ 20,361 $ 10,640 $ 9,565 $ 9,023 $ 10,796 Trade names 600 606 126 91 474 515 In-process 1,735 2,694 — — 1,735 2,694 Total $ 21,998 $ 23,661 $ 10,766 $ 9,656 $ 11,232 $ 14,005 |
Goodwill (Tables)
Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Changes in the Carrying Amount of Goodwill by Segment | The changes in the carrying amount of goodwill for the years ended December 31, 2019 and 2018 were as follows : North Europe International Other Total (U.S. $ in millions) Balance as of January 1, 201 8 11,144 9,001 5,404 2,865 28,414 Changes during the year: Goodwill impairment — — (2,834 ) (193 ) (3,027 ) Goodwill disposal (3) — (65 ) (14 ) — (79 ) Goodwill reclassified as assets to held for sale — (3 ) — (17 ) (20 ) Translation differences and Other (46 ) (280 ) (77 ) 32 (371 ) Balance as of December 31, 201 8 $ 11,098 $ 8,653 $ 2,479 $ 2,687 $ 24,917 Changes during the year: Goodwill disposal (23 ) (5 ) — — (28 ) Translation differences and Other 16 (112 ) 53 — (43 ) Balance as of December 31, 201 9 $ 11,091 $ 8,536 $ 2,532 $ 2,687 $ 24,846 (1) Accumulated goodwill impairment as of December 31, 2019, December 31, 2018 and January 1, 2018 was approximately b (2) Goodwill impairment mainly attributable to the International Markets segment ( 3 Mainly due to the divestment of the women’s health business, the sale of Actavis Brazil and other activities. |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Components Of Lease Expense | The components of operating lease cost for the year ended December 31, 2019 were as follows: Year ended (U.S. $ in millions) Operating lease cost: Fixed payments and variable payments that depend on an index or rate $ 166 Variable lease payments not included in the lease liability 6 Short-term lease cost 6 Total operating lease cost $ 178 |
Supplemental cash flow information related to leases | Supplemental cash flow information related to operating leases was as follows: Year ended (U.S. $ in millions) Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 169 Right-of-use (non-cash): Operating leases $ 142 |
Supplemental Balance Sheet Information Related To Leases | Supplemental balance sheet information related to operating leases was as follows: December 31, 2019 (U.S. $ in millions) Operating leases: Operating lease ROU assets $ 514 Other current liabilities 118 Operating lease liabilities 435 Total operating lease liabilities $ 553 December 31, 2019 Weighted average remaining lease term Operating leases 7.5 years Weighted average discount rate Operating leases 6.0 % |
Maturities of lease liabilities | Maturities of operating lease liabilities were as follows: December 31, 2019 (U.S. $ in millions) 2020 $ 146 2021 117 2022 92 2023 66 2024 and thereafter 298 Total operating lease payments $ 719 Less: imputed interest 166 Present value of lease liabilities $ 553 |
Debt obligations (Tables)
Debt obligations (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Schedule of Short-term Debt | a. Short-term debt: December 31, Weighted average 9 Maturity 2019 2018 (U.S. $ in millions) Bank and financial institutions — — — 2 Convertible debentures 0.25 % 2026 514 514 Current maturities of long-term liabilities 1,831 1,700 Total short term debt $ 2,345 $ 2,216 |
Schedule of Senior Notes and Loans | Weighted average 9 Maturity December 31, December 31, % (U.S. $ in millions) Senior notes EUR 1,010 million (2) 0.38 % 2020 $ 1,131 $ 1,897 Senior notes EUR 1,500 million 1.13 % 2024 1,673 1,707 Senior notes EUR 1,300 million 1.25 % 2023 1,451 1,480 Senior notes EUR 900 million 4.50 % 2025 1,008 1,029 Senior notes EUR 750 million 1.63 % 2028 833 850 Senior notes EUR 700 million 3.25 % 2022 784 801 Senior notes EUR 700 million 1.88 % 2027 782 798 Senior notes EUR 1,000 6.00 % 2025 1,120 — Senior notes USD 1,000 7.13 % 2025 1,000 — Senior notes USD 3,500 million 3.15 % 2026 3,494 3,493 Senior notes USD 1,475 million (3) 2.20 % 2021 1,474 2,997 Senior notes USD 3,000 million 2.80 % 2023 2,995 2,993 Senior notes USD 1,556 million (1) 1.70 % 2019 — 1,700 Senior notes USD 2,000 million 4.10 % 2046 1,985 1,985 Senior notes USD 1,250 million 6.00 % 2024 1,250 1,250 Senior notes USD 1,250 million 6.75 % 2028 1,250 1,250 Senior notes USD 844 million 2.95 % 2022 856 860 Senior notes USD 789 million 6.15 % 2036 782 782 Senior notes USD 700 million 2.25 % 2020 700 700 Senior notes USD 613 million 3.65 % 2021 618 621 Senior notes USD 588 million 3.65 % 2021 587 587 Senior notes CHF 350 million 0.50 % 2022 361 356 Senior notes CHF 350 million 1.00 % 2025 362 356 Fair value hedge accounting adjustments — (9 ) Total senior notes 26,496 28,483 Other long-term debt 1.13 % 2026 1 12 Less current maturities (1,831 ) (1,700 ) Derivative instruments — 9 Less debt issuance costs (103 ) (104 ) Total senior notes and loans $ 24,562 $ 26,700 (1) During the first six months of 2019, Teva repurchased and canceled approximately $144 million principal amount of its $1,700 million 1.7% senior notes due in July 2019. In July 2019, Teva repaid at maturity $1,556 million of its 1.7% senior notes. (2) In December (3) In November 2019, Teva consummated a cash tender offer for its $3,000 million 2.2% senior notes due in July 2021. As a result of the offer, Teva redeemed $1,525 million aggregate principal amount of this senior note. (4) In November 2019, Teva Pharmaceutical Finance Netherlands II B.V, a Teva finance subsidiary, issued senior notes in an aggregate principal amount of 1,000 million Euro bearing 6.0% annual interest and due January 2025. |
Required Annual Principal Payments of Long-term Debt, Excluding Debt Issuance Cost | December 31, (U.S. $ in millions) 2021 $ 2,679 2022 2,002 2023 4,446 2024 2,923 2025 and thereafter 13,131 $ 25,181 |
Derivative instruments and he_2
Derivative instruments and hedging activities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Notional Amounts for Hedged Items, Designated as Hedge Accounting | c. Derivative instrument disclosure: The following table summarizes the notional amounts for hedged items, when transactions are designated as hedge accounting: December 31, 2019 2018 (U.S. $ in millions) Cross-currency swap—cash flow hedge $ — $ 588 Interest rate swap—fair value hedge — 500 Cross-currency swap—net investment hedge 1,000 1,000 |
Summary of Classification and Fair Values of Derivative Instruments | The following table summarizes the classification and fair value of derivative instruments: Fair value Designated as hedging instruments Not designated as hedging instruments December 31, 2019 December 31, 2018 December 31, 2019 December 31, 2018 Reported under (U.S. $ in millions) Asset derivatives: Other current assets: Option and forward contracts $ — $ — $ 32 $ 18 Other non-current assets: Cross-currency swaps—cash flow hedge — 58 — Liability derivatives: Other current liabilities: Cross-currency swaps—net investment hedge (22 ) — Option and forward contracts — — (41 ) (26 ) Other taxes and long-term liabilities: Cross-currency swaps—net investment hedge — (41 ) — — Senior notes and loans: Interest rate swaps—fair value hedge — (9 ) — — |
Derivatives Not Designated as Hedging Instruments | The table below provides information regarding the location and amount of pre-tax Financial expenses, net Other comprehensive Year ended December 31, Year ended December 31, 2019 2018** 2017** 2019 2018** 2017** Reported under (U.S. $ in millions) Line items in which effects of hedges are recorded $ 822 $ 959 $ 895 $ 160 $ (585 ) $ 1,369 Cross-currency swaps—cash flow hedge (1) (2 ) (2 ) (3 ) (33 ) (35 ) 71 Cross-currency swaps—net investment hedge (2) (29 ) (31 ) (13 ) (22 ) (51 ) 97 Interest rate swaps—fair value hedge (3) 2 * (4 ) — — — * Represents an amount less than $0.5 million. ** Comparative figures are based on prior hedge accounting standard. |
Information Regarding The Location And Amount Of Pretax (Gains) Losses Of Derivatives Designated In Fair Value Or Cash Flow Hedging Relationships | The table below provides information regarding the location and amount of pre-tax Financial expenses, net Net revenues Year ended December 31, Year ended December 31, 2019 2018 2017 2019 2018 2017 Reported under (U.S. $ in millions) Line items in which effects of hedges are recorded $ 822 $ 959 $ 895 $ 16,887 $ 18,271 $ 21,853 Option and forward contracts (4) (51 ) (12 ) 82 — — — Option and forward contracts Economic hedge (5) — — — 14 (4 ) — (1) With respect to cross-currency swap agreements, Teva recognized gains which mainly reflect the differences between the fixed interest rate and the floating interest rate. In the fourth quarter of 2019, Teva terminated cross-currency swap agreements against its outstanding 3.65% senior notes maturing in November 2021. The settlement of these transactions resulted in cash proceeds of $95 million. The cash flow hedge accounting adjustments of these instruments, which are recorded under senior notes and loans, are amortized under financial expenses-net over the life of the debt as additional interest expense. (2) In each of the first and second quarters of 2017, Teva entered into a cross currency swap agreement with a notional amount of $500 million maturing in 2020. These cross currency swaps were designated as a net investment hedge of Teva’s foreign subsidiaries euro denominated net assets, in order to reduce the risk of adverse exchange rate fluctuations. With respect to these cross currency swap agreements, Teva recognized gains which mainly reflect the differences between the float-for-float in euros in U.S. dollar (3) In the fourth quarter of 2016, Teva entered into an interest rate swap agreement designated as fair value hedge relating to its 2.8% senior notes due 2023 with respect to $500 million notional amount of outstanding debt. With respect to this interest rate swap agreement, Teva recognized a loss which mainly reflects the differences between the fixed interest rate and the floating interest rate. In the third quarter of 2019, Teva terminated this interest rate swap agreement. The settlement of these transactions resulted in cash proceeds 10 fair value hedge expenses-net (4) Teva uses foreign exchange contracts (mainly option and forward contracts) to hedge balance sheet items from currency exposure. These foreign exchange contracts are not designated as hedging instruments for accounting purposes. In connection with these foreign exchange contracts, Teva recognizes gains or losses that offset the revaluation of the balance sheet items also recorded under financial expenses—net. (5) Teva entered into option and forward contracts designed to limit the exposure of foreign exchange fluctuations on revenues and expenses recorded in euro, the British pound, the Russian ruble and some other currencies during the quarter for which such instruments are purchased. These derivative instruments do not meet the criteria for hedge accounting, however, they are accounted for as economic hedge. These derivative instruments are recognized on the Balance Sheet at their fair value, with changes in the fair value recognized under the same line item in the Statements of Income as the underlying exposure being hedged. The cash flows associated with these derivatives are reflected as cash flows from operating activities in the consolidated Statements of Cash Flows. |
Summary of Sold Receivables Outstanding Balance Net of DPP Asset under Outstanding Securitization Program | The following table summarizes the sold receivables outstanding balance net of DPP asset under the outstanding securitization program: As of and for the year ended 2019 2018 (U.S. $ in millions) Sold receivables at the beginning of the year $ 686 $ 799 Proceeds from sale of receivables 4,852 5,071 Cash collections (remitted to the owner of the receivables) (4,849 ) (5,151 ) Effect of currency exchange rate changes 1 (33 ) Sold receivables at the end of the year $ 690 $ 686 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Schedule of Income Before Income Taxes | a. Income (loss) before income taxes: Year ended December 31, 2019 2018 2017 (U.S. $ in millions) Parent Company and its Israeli subsidiaries $ 542 $ 1,022 $ 1,451 Non-Israeli (1,807 ) (3,618 ) (19,830 ) $ (1,265 ) $ (2,596 ) $ (18,379 ) |
Schedule of the Provision for Income Taxes | b. Income taxes: Year ended December 31, 2019 2018 2017 (U.S. $ in millions) In Israel $ 107 $ 131 $ 96 Outside Israel (385 ) (326 ) (2,029 ) $ (278 ) $ (195 ) $ (1,933 ) Current $ 885 $ 700 $ 373 Deferred (1,163 ) (895 ) (2,306 ) $ (278 ) $ (195 ) $ (1,933 ) |
Accumulated Other Comprehensive Income/(Loss) (Net of Tax) | 2019 2018 2017 (U.S. $ in millions) Income ( L $ (1,265 ) $ (2,596 ) $ (18,379 ) Statutory tax rate in Israel 23.0 % 23.0 % 24.0 % Theoretical provision for income taxes $ (291 ) $ (597 ) $ (4,411 ) Increase (decrease) in effective tax rate due to: The Parent Company and its Israeli subsidiaries - Mainly tax benefits arising from reduced tax rates under benefit programs (44 ) (134 ) (253 ) Non-Israeli (115 ) 381 3,817 U.S. Tax Cuts and Jobs Act effect 97 (1,061 ) Increase (decrease) in other uncertain tax positions—net 172 58 (25 ) Effective consolidated income taxes $ (278 ) $ (195 ) $ (1,933 ) * In 2019, i s non-Israeli i s non-Israeli |
Schedule of Deferred Income Taxes | c. Deferred income taxes: December 31, 2019 2018 (U.S. $ in millions) Long-term deferred tax assets (liabilities)—net: Inventory related $ 144 $ 113 Sales reserves and allowances 198 199 Provision for legal settlements 260 42 Intangible assets (*) (1,733 ) (2,282 ) Carryforward losses and deductions and credits (**) 1,689 1,340 Property, plant and equipment (170 ) (167 ) Deferred interest 648 391 Provisions for employee related obligations 106 102 Other 122 123 1,264 (139 ) Valuation allowance—in respect of carryforward losses and deductions that may not be utilized (1,974 ) (1,633 ) $ (710 ) $ (1,772 ) * The decrease in deferred tax liability is mainly due to impairment and amortization. ** The amounts are shown after reduction for unrecognized tax benefits of $ Th ese s 2020 2022 2023 2030 |
Schedule of Deferred Tax Assets and Liabilities By Report Caption | The deferred income taxes are reflected in the balance sheets among: December 31, 2019 2018 (U.S. $ in millions) Long-term assets—deferred income taxes 386 368 Long-term liabilities—deferred income taxes (1,096 ) (2,140 ) $ (710 ) $ (1,772 ) |
Schedule of Unrecognized Tax Benefits | d. Uncertain tax positions: The following table summarizes the activity of Teva’s gross unrecognized tax benefits: Year ended December 31, 2019 2018 2017 (U.S. $ in millions) Balance at the beginning of the year $ 1,072 $ 1,034 $ 734 Increase related to prior year tax positions, net 23 76 56 Increase related to current year tax positions 246 11 26 Decrease related to settlements with tax authorities and lapse of applicable statutes of limitations (118 ) (49 ) (56 ) Liabilities assumed in acquisitions — — 273 Other — — 1 Balance at the end of the year $ 1,223 $ 1,072 $ 1,034 |
Equity (Tables)
Equity (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Stock Option Activity | A summary of the status of the options as of December 31, 2019, 2018 and 2017, and changes during the years ended on those dates, is presented below (the number of options represents ordinary shares exercisable in respect thereof). Year ended December 31, 2019 2018 2017 Number (in thousands) Weighted Number (in thousands) Weighted Number (in thousands) Weighted Balance outstanding at begin n 48,393 $ 38.62 43,121 $ 44.32 32,789 $ 50.71 Changes during the year: Granted — — 12,401 19.12 15,467 32.08 Exercised (11 ) 16.99 (84 ) 17.01 (7 ) 17.44 Forfeited (8,318 ) 42.12 (7,040 ) 39.38 (4,953 ) 47.92 Expired — — (5 ) 50.65 (175 ) 59.81 Balance outstanding at end of year 40,064 37.90 48,393 38.62 43,121 44.32 Balance exercisable at end of year 26,601 43.41 24,086 46.89 19,129 47.94 |
Summary of Weighted Average Fair Value of Options Granted | The weighted average fair value of options granted during these years was generally estimated by using the Black-Scholes option-pricing model as follows: Year ended December 31, 2019 2018 2017 Weighted average fair value — $ 7.4 $ 5.7 |
Summary of Fair Value of Options Estimated on Date of Grant Based on Weighted Average Assumptions | The fair value of these options was estimated on the date of grant, based on the following weighted average assumptions: Year ended December 31, 2019 2018 2017 Dividend yield — 0 % 3.7 % Expected volatility — 40 % 29 % Risk-free interest rate — 2.6 % 2.1 % |
Schedule of Ordinary Shares Issued Upon Outstanding Options | The following tables summarize s of (1) Number of ordinary shares issuable upon exercise of outstanding options Balance at end of Weighted average Weighted average Aggregate intrinsic Number of shares $ Years $ Lower than $15.01 592 11.40 7.85 — $15.01 - $25.00 10,938 18.94 8.13 — $25.01 - $35.00 7,914 34.62 7.16 — $35.01 - $45.00 5,511 40.59 2.49 — $45.01 - $55.00 10,328 50.74 4.53 — $55.01 - $65.00 4,781 59.20 5.31 — Total 40,064 37.90 5.89 — |
Schedule of Ordinary Shares Issued Upon Vested Options | (2) Number of ordinary shares issuable upon exercise of vested options Balance at end of Weighted average Weighted average Aggregate intrinsic Number of shares $ Years $ Lower than $15.01 197 11.40 7.85 — $15.01 - $25.00 3,211 18.57 8.05 — $25.01 - $35.00 3,983 34.61 7.16 — $35.01 - $45.00 5,511 40.59 2.49 — $45.01 - $55.00 9,165 50.43 4.32 — $ 55.01 65.00 4,534 59.37 5.27 — Total 26,601 43.41 5.00 — |
Schedule of the Number of RSUs Issued and Outstanding | The following table summarizes information about the number of RSUs and PSUs issued and outstanding: Year ended December 31, 2019 2018 2017 Number (in thousands) Weighted Number (in thousands) Weighted Number (in thousands) Weighted Balance outstanding at beginning of year 10,403 $ 20.93 7,468 $ 27.95 4,636 $ 45.15 Granted 9,303 15.36 5,900 18.80 5,461 20.10 Vested (2,435 ) 30.24 (1,638 ) 37.30 (1,884 ) 39.63 Forfeited (1,294 ) 18.74 (1,327 ) 32.50 (745 ) 42.84 Balance outstanding at end of year 15,977 16.49 10,403 20.93 7,468 27.95 |
Summary of Company Expenses Compensation Costs Based on Grant Date Fair Value | The Company expenses compensation costs are Year ended December 31, 2019 2018 2017 (U.S. $ in millions) Employee stock options $ 46 $ 74 $ 64 RSUs and PSUs 73 81 69 Total stock-based compensation expense 119 155 133 Tax effect on stock-based compensation expense 14 18 24 Net effect $ 105 $ 137 $ 109 |
Accumulated Other Comprehensive Income/(Loss) (Net of Tax) | The components of accumulated other Net Unrealized Gains/(Losses) Benefit Plans Foreign Available- for- sale securities Derivative Actuarial gains/(losses) service Total Balance, January 1, 201 7 (2,592 ) (7 ) (479 ) (81 ) (3,159 ) Other comprehensive income/(loss) before reclassifications 1,075 64 (167 ) (3 ) 969 Amounts reclassified to the statements of income 378 (66 ) 27 (5 ) 334 Net other comprehensive income/(loss) before tax 1,453 (2 ) (140 ) (8 ) 1,303 Corresponding income tax 5 — (2 ) 3 Net other comprehensive income/(loss) after tax* 1,453 3 (140 ) (10 ) 1,306 Balance, December 31, 2017 (1,139 ) (4 ) (619 ) (91 ) (1,853 ) Cumulative effect of new accounting standard ** — 5 — — 5 Other comprehensive income/(loss) before reclassifications (739 ) (1 ) 87 4 (649 ) Amounts reclassified to the statements of income 1 28 13 42 Net other comprehensive income/(loss) before tax (739 ) — 115 17 (607 ) Corresponding income tax — — (4 ) (4 ) Net other comprehensive income/(loss) after tax* (739 ) — 115 13 (611 ) Balance, December 31, 2018 (1,878 ) 1 (504 ) (78 ) (2,459 ) Other comprehensive income/(loss) before reclassifications 84 (1 ) 54 (11 ) 126 Amounts reclassified to the statements of income 30 (10 ) 20 Net other comprehensive income/(loss) before tax 84 (1 ) 84 (21 ) 146 Corresponding income tax — — — 1 1 Net other comprehensive income/(loss) after tax* 84 (1 ) 84 (20 ) 147 Balance, December 31, 2019 (1,794 ) — (420 ) (98 ) (2,312 ) * Amounts do not include foreign currency translation adjustments attributable to non-controlling 9 gain 8 7 . ** Following the adoption of ASU 2016-01, the Company recorded a $5 million opening balance reclassification from accumulated other comprehensive income to retained earnings. |
Other assets impairments, res_2
Other assets impairments, restructuring and other items (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Schedule of Other Assets Impairments, Restructuring and Other Items | Year ended December 31, 2019 2018 2017 (U.S. $ in millions) Impairment of long-lived tangible assets $ 139 $ 500 $ 544 Contingent consideration (see note 2 0 59 57 154 Acquisition, integration and related costs — 13 105 Restructuring 199 488 535 Venezuela deconsolidation charge (see note 1) — — 396 Other 26 (71 ) 102 Total $ 423 $ 987 $ 1,836 (1) Including impairments related to exit and disposal activities |
Summary of Restructuring Plan Including Costs Related to Exit and Disposal | The following tables provide the components of costs associated with Teva’s restructuring plan, including other costs associated with Teva’s restructuring plan and recorded under different items: Year ended December 31, 201 9 201 8 201 7 (U.S. $ in millions) Restructuring $ 159 $ 410 $ 443 40 78 92 Total $ 199 $ 488 $ 535 |
Summary of Restructuring Accruals | The following table provides the components of and changes in the Company’s restructuring accruals: Employee Other Total (U.S. $ in millions) Balance as of January 1, 201 8 $ (294 ) $ (17 ) $ (311 ) Provision (410 ) (78 ) (488 ) Utilization and other* 500 66 566 Balance as of December 31, 201 8 $ (204 ) $ (29 ) $ (233 ) Provision (159 ) (40 ) (199 ) Utilization and other* 155 62 217 Balance as of December 31, 201 9 $ (208 ) $ (7 ) $ (215 ) * Includes adjustments for foreign currency translation. |
Other income (Tables)
Other income (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Schedule of Other Income | Year ended December 31, 2019 2018 2017 (U.S. $ in millions) Gain on divestitures, net of divestitures related costs (1) $ 50 67 1,083 Section 8 and similar payments (2) 5 195 83 Gain ( loss) (1 ) 9 11 Other, net 22 20 22 Total other income $ 76 $ 291 $ 1,199 (1) Mainly related to the divestment of several activities in the International Markets segment. (2) Section 8 of the Patented Medicines (Notice of Compliance) Regulation relates to recoveries of lost revenue related to patent infringement proceedings in Canada. |
Financial expenses-net (Tables)
Financial expenses-net (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Schedule of Financial Expenses | Year ended December, 31 2019 2018 2017 (U.S. $ in millions) Venezuela devaluation (1) $ — $ — $ 42 Interest expenses and other bank charges 881 920 875 Income from investments (41 ) (39 ) (84 ) Foreign exchange (gains) losses — net (15 ) 13 65 Other, net (2) (4 ) 65 (3 ) Total finance expense—net $ 822 $ 959 $ 895 (1) For further information regarding the Venezuela devaluation, refer to note 1a. (2) In 2018 , |
Earnings (Loss) per Share (Tabl
Earnings (Loss) per Share (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Schedule of Earnings per Share | The net income attributable to Teva and the weighted average number of ordinary shares used in the loss 2019 2018 2017 (U.S. $ in millions, except share data) Net income (loss) used for the computation of diluted loss $ (999 ) $ (2,399 ) $ (16,525 ) Weighted average number of shares used in the computation of basic loss 1,091 1,021 1,016 Add: Weighted average number of shares used in the computation of diluted loss 1,091 1,021 1,016 |
Segments (Tables)
Segments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Segment Profit | a. Segment information: Year ended December 31, 2019 North Europe International * (U.S. $ in millions) Revenues $ 8,542 $ 4,795 $ 2,246 Gross profit 4,350 2,704 1,167 R&D expenses 652 262 88 S&M expenses 1,021 890 481 G&A expenses 439 239 138 Other income (14 ) (5 ) (3 ) Segment profit $ 2,252 $ 1,318 $ 464 Year ended December 31, 2018 North America Europe International Markets * (U.S. $ in millions) Revenues $ 9,297 $ 5,186 $ 2,422 Gross profit 4,979 2,884 1,254 R&D expenses 713 283 96 S&M expenses 1,154 1,003 518 G&A expenses 484 325 153 Other income (209 ) — (11 ) Segment profit $ 2,837 $ 1,273 $ 498 Year ended December 31, 2017 North America Europe International Markets* (U.S. $ in millions) Revenues $ 12,141 $ 5,466 $ 2,863 Gross profit 7,322 2,887 1,433 R&D expenses 969 390 154 S&M expenses 1,288 1,130 672 G&A expenses 533 354 189 Other income (92 ) (16 ) (8 ) Segment profit $ 4,624 $ 1,029 $ 426 * The data presented for prior periods have been revised to reflect a revision in the presentation of net revenues and cost of sales in the consolidated financial statements. See note 1b. |
Schedule Of Consolidated Income Before Income Tax | Year ended December 31, 2019 2018 2017 (U.S. North America profit $ 2,252 $ 2,837 $ 4,624 Europe profit 1,318 1,273 1,029 International Markets profit 464 498 426 Total reportable 4,034 4,608 6,079 Profit (loss) of other activities 108 115 (6 ) Total segments profit 4,142 4,723 6,073 Amounts not allocated to segments: Amortization 1,113 1,166 1,444 Other asset impairments, restructuring and other items 423 987 1,836 Goodwill impairment — 3,027 17,100 Intangible asset impairments 1,639 1,991 3,238 Gain on divestitures, net of divestitures related costs (50 ) (66 ) (1,083 ) Inve nto r y St ep up — — 67 Other R&D expenses (15 ) 83 221 Costs related to regulatory actions taken in facilities 45 14 47 Legal settlements and loss contingencies 1,178 (1,208 ) 500 Other unallocated amounts 252 366 187 Consolidated operating income (loss) (443 ) (1,637 ) (17,484 ) Financial expenses, net 822 959 895 Consolidated income (loss) before income taxes $ (1,265 ) $ (2,596 ) $ (18,379 ) |
Schedule of Net Sales by Product Line | North America segment: Year ended December 31, 2019 2018 2017 (U.S. $ in millions) Generic products $ 3,963 $ 4,056 $ 5,203 COPAXONE 1,017 1,759 3,116 BENDEKA/TREANDA 496 642 656 ProAir* 274 397 501 QVAR 250 182 313 AJOVY 93 3 — AUSTEDO 412 204 24 Anda 1,492 1,347 1,153 Other 546 708 1,175 Total $ 8,542 $ 9,297 $ 12,141 * Does not include revenues from the ProAir authorized generic, which are included under generic products. Europe segment: Year ended December 31, 2019 2018 2017 (U.S. $ in millions) Generic products $ 3,470 $ 3,593 $ 3,471 COPAXONE 432 535 595 Respiratory products 354 402 368 Other 539 656 1,033 Total $ 4,795 $ 5,186 $ 5,466 International Markets segme n Year ended December 31, 2019 2018 2017 (U.S. $ in millions) Generic products $ 1,893 $ 2,022 $ 2,370 COPAXONE 63 72 91 Distributio n 20 19 17 Other 271 309 385 Total $ 2,246 $ 2,422 $ 2,863 * The data presented for prior periods have been revised to reflect a revision in the presentation of net revenues and cost of sales in the consolidated financial statements. See note 1b. |
Schedule of Sales Percentage by Therapeutic Category | The following table represents the percentage of consolidated third party net sales to Teva’s major customers during the years ended December 31, 2019, 2018 and 2017. Percentage of Third Party Net Sales 2019 2018 2017 McKesson Corporation 13 % 12 % 16 % AmerisourceBergen Corporation 12 % 14 % 15 % |
Schedule of Property, Plant and Equipment by Geographic Location | d. Property, plant and equipment—by geographical location were as follows: December 31, 2019 2018 (U.S. $ in millions) Israel $ 1,670 $ 1,987 United States 864 950 Croatia 517 538 Germany 665 518 Czech republic 343 352 Hungary 330 343 Japan 177 188 Other 1,870 1,992 Total property, plant and equipment $ 6,436 $ 6,868 |
Fair Value Measurement (Tables)
Fair Value Measurement (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Financial Items Carried at Fair Value | Financial items g December 31, 2019 Level 1 Level 2 Level 3 Total (U.S. $ in millions) Cash and cash equivalents: Money markets $ 577 $ — $ — $ 577 Cash, deposits and other 1,398 — — 1,398 Investment in securities: Equity securities 42 — — 42 Other, mainly debt securities 2 — 12 14 Derivatives: Asset derivatives — options and forward contracts — 32 — 32 Liabilities derivatives — options and forward contracts — (41 ) — (41 ) Liabilities derivatives — interest rate and cross-currency swaps — (22 ) — (22 ) Contingent consideration* — — (460 ) (460 ) Total $ 2,019 $ (31 ) $ (448 ) $ 1,540 December 31, 2018 Level 1 Level 2 Level 3 Total (U.S. $ in millions) Cash and cash equivalents: Money markets $ 203 $ — $ — $ 203 Cash, deposits and other 1,579 — — 1,579 Investment in securities: Equity securities 51 — — 51 Other, mainly debt securities 2 — 10 12 Derivatives: Asset derivatives — options and forward contracts — 18 — 18 Asset derivatives — cross-currency swaps — 58 — 58 Liability derivatives — options and forward contracts — (26 ) — (26 ) Liabilities derivatives — interest rate and cross-currency swaps — (50 ) — (50 ) Contingent consideration* — — (507 ) (507 ) Total $ 1,835 $ — $ (497 ) $ 1,338 * Contingent consideration represents liabilities recorded at fair value in connection with acquisitions. |
Summary of Fair Value of Financial Liabilities Measured Using Level 3 Inputs | The following table summarizes the activity for those financial assets and liabilities where fair value measurements are estimated utilizing Level 3 inputs . December 31, 2019 December 31, 2018 (U.S. $ in millions) Fair value at the beginning of the period $ (497 ) $ (717 ) Investment in debt securities 2 (8 ) Adjustments to provisions for contingent consideration: Actavis Generics transaction 92 — Labrys acquisition — (17 ) Eagle transaction (151 ) (40 ) Settlement of contingent consideration: Labrys acquisition — 151 Eagle transaction 106 134 Fair value at the end of the period $ (448 ) $ (497 ) |
Summary of Financial Instrument Measured on a Basis Other Than Fair Value | Financial instruments measured on a basis other than fair value consist of senior notes and convertible senior debentures (see note 9), and are presented in the below table in terms of fair value: Estimated fair value* December 31, 2019 2018 (U.S. $ in millions) Senior notes included under long-term liabilities $ 22,686 $ 23,560 Senior notes and convertible senior debentures included under short-term liabilities 2,318 2,140 Fair value at the end of the period $ 25,004 $ 25,700 * |
Long-term Employee-related Ob_2
Long-term Employee-related Obligations (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Schedule of Long Term Employee Related Obligation | a. Long-term employee-related obligations consisted of the following: December 31, 2019 2018 (U.S. $ in millions) Accrued severance obligations $ 76 $ 75 Defined benefit plans 165 146 Total $ 241 $ 221 |
Selected Quarterly Financial _2
Selected Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Selected Quarterly Financial Data | The following table presents selected unaudited quarterly financial data for 201 9 8 2019 4th quarter 3rd quarter 2nd quarter 1st quarter (U.S $ in millions except per share amounts) Net revenues * 4,468 4,093 4,177 4,149 Gross profit 1,958 1,830 1,893 1,856 Net income (loss) 75 (307 ) (671 ) (97 ) Net income (loss) attributable to Teva 110 (314 ) (689 ) (105 ) Net income (loss) attributable to ordinary shareholders 110 (314 ) (689 ) (105 ) Earnings per share attributable to ordinary shareholders: Basic 0.10 (0.29 ) (0.63 ) (0.10 ) Diluted 0.10 (0.29 ) (0.63 ) (0.10 ) 2018 4th quarter 3rd quarter 2nd quarter 1st quarter (U.S $ in millions except per share amounts) Net revenues * 4,419 4,385 4,552 4,916 Gross profit 1,971 1,977 2,033 2,315 Net income (loss) (3,243 ) (197 ) (166 ) 1,134 Net income (loss) attributable to Teva (2,886 ) (208 ) (176 ) 1,120 Net income (loss) attributable to ordinary shareholders (2,940 ) (273 ) (241 ) 1,055 Earnings per share attributable to ordinary shareholders: Basic (2.85 ) (0.27 ) (0.24 ) 1.04 Diluted (2.85 ) (0.27 ) (0.24 ) 1.03 * The data presented for prior periods have been revised to reflect a revision in the presentation of net revenues and cost of sales in the consolidated financial statements. See table below and not e |
Summary of the impact of the revision on net revenues and cost of sales | The following table summarizes the impact of the revision on net revenues and cost of sales in the consolidated statement of income for the relevant periods: Net revenues Cost of sales As reported Adjustment As revised As reported Adjustment As revised (U.S. $ in millions) 2018 Q1 5,065 (149 ) 4,916 2,750 (149 ) 2,601 Q2 4,701 (150 ) 4,552 2,668 (150 ) 2,518 Q3 4,529 (143 ) 4,385 2,552 (143 ) 2,409 Q4 4,559 (141 ) 4,419 2,588 (141 ) 2,447 2019 Q1 4,295 (146 ) 4,149 2,440 (146 ) 2,293 Q2 4,337 (159 ) 4,177 2,443 (159 ) 2,284 Q3 4,264 (171 ) 4,093 2,435 (171 ) 2,264 |
Significant Accounting Polici_4
Significant Accounting Policies - Summary of impact of the revision on net revenues and cost of sales in the consolidated statement of income (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Net revenues | $ 4,468 | $ 4,093 | $ 4,177 | $ 4,149 | $ 4,419 | $ 4,385 | $ 4,552 | $ 4,916 | $ 16,887 | $ 18,271 | $ 21,853 |
Net revenues [Member] | |||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Net revenues | 18,271 | 21,853 | |||||||||
Cost of sales [Member] | |||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Net revenues | 9,975 | 11,237 | |||||||||
As reported [Member] | |||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Net revenues | 4,264 | 4,337 | 4,295 | 4,559 | 4,529 | 4,701 | 5,065 | ||||
As reported [Member] | Net revenues [Member] | |||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Net revenues | 18,854 | 22,385 | |||||||||
As reported [Member] | Cost of sales [Member] | |||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Net revenues | 10,558 | 11,770 | |||||||||
Restatement adjustment [Member] | |||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Net revenues | $ (171) | $ (159) | $ (146) | $ (141) | $ (143) | $ (150) | $ (149) | ||||
Restatement adjustment [Member] | Net revenues [Member] | |||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Net revenues | (583) | (533) | |||||||||
Restatement adjustment [Member] | Cost of sales [Member] | |||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Net revenues | $ (583) | $ (533) |
Significant Accounting Polici_5
Significant Accounting Policies - Additional information (Detail) - USD ($) shares in Millions, $ in Millions | Dec. 31, 2018 | Dec. 17, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Significant Accounting Policies [Line Items] | |||||
Cash deposited with financially sound European us and Israeli banks and financial institutions | $ 2,030 | ||||
Percentage of consolidated sales in North America | 47.00% | ||||
Shipping and handling costs, which are included in selling and marketing expenses | $ 138 | $ 159 | $ 164 | ||
Advertising expense | 213 | 256 | 318 | ||
Ordinary shares issued upon mandatory conversion of preferred shares | 70.6 | 70.6 | |||
Operating lease right-of-use assets | 514 | ||||
Operating lease liability | $ 553 | ||||
Operating leases rent expense net | 175 | 200 | |||
Operating Lease description | Teva determines if an arrangement is a lease at inception. Lease classification is governed by five criteria in ASC 842-10-25-2. If any of these five criteria is met, Teva classifies the lease as a finance lease. Otherwise, Teva classifies the lease as an operating lease. When determining lease classification, Teva’s approach in assessing two of the mentioned criteria is: (i) generally, 75% or more of the remaining economic life of the underlying asset is a major part of the remaining economic life of that underlying asset; and (ii) generally, 90% or more of the fair value of the underlying asset comprises substantially all of the fair value of the underlying asset. | ||||
Royalty income | $ 147 | $ 165 | $ 327 | ||
Accounting Standards Update 2016-02 [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Operating lease right-of-use assets | 553 | ||||
Operating lease liability | $ 561 | ||||
Building [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Property plant and equipment useful life | 40 years | ||||
Minimum [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Credit terms to customers | 30 days | ||||
Operating Lease Remaining Lease Term | 1 year | ||||
Minimum [Member] | Other Machinery and Equipment [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Property plant and equipment useful life | 15 years | ||||
Minimum [Member] | Other Capitalized Property Plant and Equipment [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Property plant and equipment useful life | 5 years | ||||
Maximum [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Credit terms to customers | 90 days | ||||
Operating Lease Remaining Lease Term | 80 years | ||||
Maximum [Member] | Other Machinery and Equipment [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Property plant and equipment useful life | 20 years | ||||
Maximum [Member] | Other Capitalized Property Plant and Equipment [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Property plant and equipment useful life | 10 years |
Certain Transactions - Business
Certain Transactions - Business Transactions - Additional Information (Detail) - USD ($) shares in Millions, $ in Millions | Jan. 31, 2018 | Oct. 03, 2016 | Aug. 02, 2016 |
Allergan plc [Member] | |||
Business Acquisition [Line Items] | |||
Allergan one time payment to Teva | $ 703 | ||
Actavis [Member] | |||
Business Acquisition [Line Items] | |||
Cash consideration | $ 33,400 | ||
Shares issued as consideration for the acquisition | 100.3 | ||
Anda [Member] | |||
Business Acquisition [Line Items] | |||
Cash consideration | $ 500 |
Certain Transactions - Other Tr
Certain Transactions - Other Transactions - Additional Information (Detail) $ in Millions | Jan. 08, 2018USD ($) | May 12, 2017USD ($) | Mar. 03, 2016USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2016USD ($) | Nov. 30, 2016USD ($) | Sep. 30, 2016USD ($)Lawsuit | Dec. 31, 2018USD ($) | Mar. 31, 2018USD ($) | Jun. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Oct. 31, 2016USD ($) |
Noncash or Part Noncash Acquisitions [Line Items] | |||||||||||||||
Other asset impairments, restructuring and other items | $ 423 | $ 987 | $ 1,836 | ||||||||||||
Net (gain) loss from sale of long-lived assets and investments | $ (18) | $ (19) | (1,090) | ||||||||||||
PGT Healthcare Partnership [Member] | |||||||||||||||
Noncash or Part Noncash Acquisitions [Line Items] | |||||||||||||||
Other asset impairments, restructuring and other items | $ 64 | ||||||||||||||
Write-down of investment | 94 | ||||||||||||||
Net (gain) loss from sale of long-lived assets and investments | $ 50 | ||||||||||||||
Rimsa [Member] | |||||||||||||||
Noncash or Part Noncash Acquisitions [Line Items] | |||||||||||||||
Cash consideration | $ 2.3 | ||||||||||||||
Number of lawsuits filed | Lawsuit | 2 | ||||||||||||||
Alder [Member] | |||||||||||||||
Noncash or Part Noncash Acquisitions [Line Items] | |||||||||||||||
Upfront payment | $ 25 | ||||||||||||||
Collaborative agreement milestone payments | $ 175 | ||||||||||||||
Otsuka [Member] | |||||||||||||||
Noncash or Part Noncash Acquisitions [Line Items] | |||||||||||||||
Upfront payment | $ 50 | ||||||||||||||
Attenukine [Member] | |||||||||||||||
Noncash or Part Noncash Acquisitions [Line Items] | |||||||||||||||
Upfront payment | $ 30 | ||||||||||||||
Milestone payment | $ 20 | ||||||||||||||
Additional considerations | $ 260 | ||||||||||||||
Ninlaro [Member] | |||||||||||||||
Noncash or Part Noncash Acquisitions [Line Items] | |||||||||||||||
Upfront payment | $ 150 | ||||||||||||||
Payment | 150 | ||||||||||||||
Upfornt payments received | $ 150 | ||||||||||||||
Celltrion [Member] | |||||||||||||||
Noncash or Part Noncash Acquisitions [Line Items] | |||||||||||||||
Refundable payment | $ 60 | ||||||||||||||
Total associated cost | $ 160 | ||||||||||||||
Regeneron [Member] | |||||||||||||||
Noncash or Part Noncash Acquisitions [Line Items] | |||||||||||||||
Upfront payment | $ 250 | ||||||||||||||
Collaborative agreement milestone payments | $ 60 | $ 35 | $ 25 | ||||||||||||
Research and development costs | $ 1,000 |
Certain Transactions - Busine_2
Certain Transactions - Business Acquisitions - Summary of Major Classes of Assets and Liabilities Included as Held for Sale (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Property, plant and equipment, net | $ 6,436 | $ 6,868 | ||
Goodwill | [1] | 24,846 | 24,917 | $ 28,414 |
Total assets | 57,470 | 60,683 | ||
Disposal Group, Held-for-sale, Not Discontinued Operations [Member] | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Property, plant and equipment, net | 98 | 92 | ||
Goodwill | 51 | |||
Adjustments of assets held for sale to fair value | (11) | (51) | ||
Total assets | $ 87 | $ 92 | ||
[1] | Accumulated goodwill impairment as of December 31, 2019, December 31, 2018 and January 1, 2018 was approximately $21.0 billion, $21.0 billion and $18.0 billion, respectively. |
Revenue from Contracts with C_3
Revenue from Contracts with Customers - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2019 | |
United States [Member] | |
Revenue Recognition [Line Items] | |
Percentage sales reserves and allowances to U.S. customers | 83.00% |
Revenue from Contracts with C_4
Revenue from Contracts with Customers - Summary of Disaggregation of Revenues by Major Revenue Streams (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | $ 4,468 | $ 4,093 | $ 4,177 | $ 4,149 | $ 4,419 | $ 4,385 | $ 4,552 | $ 4,916 | $ 16,887 | $ 18,271 | $ 21,853 | ||
Sale of Goods [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 14,510 | 15,881 | 19,256 | ||||||||||
Licensing Arrangements [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 147 | 165 | 327 | ||||||||||
Distribution [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 1,514 | 1,373 | 1,384 | ||||||||||
Other [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 716 | 852 | 886 | ||||||||||
International Markets [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | [1] | 2,246 | 2,422 | 2,863 | |||||||||
International Markets [Member] | Sale of Goods [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 2,045 | 2,151 | 2,558 | ||||||||||
International Markets [Member] | Licensing Arrangements [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 4 | 22 | 38 | ||||||||||
International Markets [Member] | Distribution [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 20 | 19 | 17 | ||||||||||
International Markets [Member] | Other [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 177 | 230 | 250 | ||||||||||
Other activities [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 1,304 | 1,366 | 1,383 | ||||||||||
Other activities [Member] | Sale of Goods [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 754 | 739 | 748 | ||||||||||
Other activities [Member] | Licensing Arrangements [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 5 | 9 | 5 | ||||||||||
Other activities [Member] | Other [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 545 | 618 | 630 | ||||||||||
North America [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 8,542 | 9,297 | 12,141 | ||||||||||
North America [Member] | Sale of Goods [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 6,941 | 7,838 | 10,706 | ||||||||||
North America [Member] | Licensing Arrangements [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 109 | 111 | 281 | ||||||||||
North America [Member] | Distribution [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 1,492 | 1,347 | 1,153 | ||||||||||
North America [Member] | Other [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | [2] | 1 | 1 | ||||||||||
Europe [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 4,795 | 5,186 | 5,466 | ||||||||||
Europe [Member] | Sale of Goods [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 4,770 | 5,153 | 5,244 | ||||||||||
Europe [Member] | Licensing Arrangements [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 29 | 23 | 3 | ||||||||||
Europe [Member] | Distribution [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 2 | 7 | 214 | ||||||||||
Europe [Member] | Other [Member] | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | $ (6) | $ 3 | $ 5 | ||||||||||
[1] | The data presented for prior periods have been revised to reflect a revision in the presentation of net revenues and cost of sales in the consolidated financial statements. See note 1b. | ||||||||||||
[2] | Represents an amount less than $1 million. |
Revenue from Contracts with C_5
Revenue from Contracts with Customers - Schedule of Sales Reserves and Allowances (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Revenue Recognition [Line Items] | ||
Balance at beginning of period | $ 6,886 | $ 8,077 |
Provisions related to sales made in current year period | 17,150 | 19,413 |
Provisions related to sales made in prior periods | (189) | (59) |
Credits and payments | (17,605) | (20,480) |
Translation differences | 4 | (65) |
Balance at end of period | 6,246 | 6,886 |
Reserves Included in Accounts Receivable, Net [Member] | ||
Revenue Recognition [Line Items] | ||
Balance at beginning of period | 175 | 196 |
Provisions related to sales made in current year period | 383 | 514 |
Provisions related to sales made in prior periods | 3 | |
Credits and payments | (471) | (538) |
Balance at end of period | 87 | 175 |
Rebates [Member] | ||
Revenue Recognition [Line Items] | ||
Balance at beginning of period | 3,006 | 3,077 |
Provisions related to sales made in current year period | 5,552 | 6,572 |
Provisions related to sales made in prior periods | (92) | (14) |
Credits and payments | (5,570) | (6,596) |
Translation differences | (1) | (33) |
Balance at end of period | 2,895 | 3,006 |
Medicaid and Other Governmental Allowances [Member] | ||
Revenue Recognition [Line Items] | ||
Balance at beginning of period | 1,361 | 1,908 |
Provisions related to sales made in current year period | 976 | 1,284 |
Provisions related to sales made in prior periods | (151) | 24 |
Credits and payments | (1,076) | (1,850) |
Translation differences | (1) | (5) |
Balance at end of period | 1,109 | 1,361 |
Chargebacks [Member] | ||
Revenue Recognition [Line Items] | ||
Balance at beginning of period | 1,530 | 1,849 |
Provisions related to sales made in current year period | 9,565 | 10,206 |
Provisions related to sales made in prior periods | (17) | |
Credits and payments | (9,736) | (10,519) |
Translation differences | 1 | (6) |
Balance at end of period | 1,342 | 1,530 |
Returns [Member] | ||
Revenue Recognition [Line Items] | ||
Balance at beginning of period | 638 | 780 |
Provisions related to sales made in current year period | 281 | 442 |
Provisions related to sales made in prior periods | 77 | 28 |
Credits and payments | (360) | (606) |
Translation differences | 1 | (6) |
Balance at end of period | 637 | 638 |
Other [Member] | ||
Revenue Recognition [Line Items] | ||
Balance at beginning of period | 176 | 267 |
Provisions related to sales made in current year period | 394 | 417 |
Provisions related to sales made in prior periods | (6) | (30) |
Credits and payments | (392) | (463) |
Translation differences | 4 | (15) |
Balance at end of period | 176 | 176 |
Total Reserves Included in Sales Reserves and Allowances [Member] | ||
Revenue Recognition [Line Items] | ||
Balance at beginning of period | 6,711 | 7,881 |
Provisions related to sales made in current year period | 16,767 | 18,899 |
Provisions related to sales made in prior periods | (189) | (62) |
Credits and payments | (17,134) | (19,942) |
Translation differences | 4 | (65) |
Balance at end of period | $ 6,159 | $ 6,711 |
Inventories - Summary of Invent
Inventories - Summary of Inventories (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Inventories [Line Items] | ||
Finished products | $ 2,504 | $ 2,665 |
Raw and packaging materials | 1,183 | 1,328 |
Products in process | 583 | 590 |
Materials in transit and payments on account | 151 | 148 |
Total | $ 4,422 | $ 4,731 |
Property, Plant and Equipment -
Property, Plant and Equipment - Summary of Property, Plant and Equipment, Net (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Machinery and equipment | $ 5,385 | $ 5,658 |
Buildings | 2,839 | 3,133 |
Computer equipment and other assets | 2,131 | 2,089 |
Assets under construction and payments on account | 672 | 565 |
Land | 323 | 351 |
Subtotal | 11,350 | 11,796 |
Less-accumulated depreciation | (4,914) | (4,928) |
Property, Plant and Equipment, Net, Total | $ 6,436 | $ 6,868 |
Property, Plant and Equipment_2
Property, Plant and Equipment - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation expense for the year | $ 609 | $ 676 | $ 632 |
Impairment charge during the year on property, plant and equipment | $ 139 | $ 500 | $ 544 |
Identifiable Intangible Asset_2
Identifiable Intangible Assets - Summary of Identifiable Intangible Assets (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount net of impairment | $ 21,998 | $ 23,661 |
Accumulated amortization | 10,766 | 9,656 |
Net carrying amount | 11,232 | 14,005 |
Identifiable product rights [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount net of impairment | 19,663 | 20,361 |
Accumulated amortization | 10,640 | 9,565 |
Net carrying amount | 9,023 | 10,796 |
Trade Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount net of impairment | 600 | 606 |
Accumulated amortization | 126 | 91 |
Net carrying amount | 474 | 515 |
In Process Research and Development (IPR&D) [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount net of impairment | 1,735 | 2,694 |
Net carrying amount | $ 1,735 | $ 2,694 |
Identifiable Intangible Asset_3
Identifiable Intangible Assets - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Finite-Lived Intangible Assets [Line Items] | |||
Amortization of intangible assets useful life | 12 years | ||
Amortization of intangible assets | $ 1,113 | $ 1,166 | $ 1,444 |
2020 | 1,019 | ||
2021 | 856 | ||
2022 | 794 | ||
2023 | 790 | ||
2024 | 773 | ||
IPR&D to product rights | 291 | ||
Impairment of intangible assets excluding goodwill | 1,639 | $ 1,991 | $ 3,238 |
In Process Research and Development [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Impairment of intangible assets excluding goodwill | 681 | ||
In Process Research and Development [Member] | Lenalidomide Product [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Impairment of intangible assets excluding goodwill | 125 | ||
Identifiable product rights [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Impairment of intangible assets excluding goodwill | 958 | ||
Actavis [Member] | In Process Research and Development [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Business combination recognized identifiable assets | 1,453 | ||
Impairment of intangible assets excluding goodwill | 59 | ||
Actavis [Member] | In Process Research and Development [Member] | Lenalidomide Product [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Impairment of intangible assets excluding goodwill | 497 | ||
Actavis [Member] | Identifiable product rights [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Impairment of intangible assets excluding goodwill | 647 | ||
Rimsa [Member] | In Process Research and Development [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Business combination recognized identifiable assets | 48 | ||
AUSTEDO [Member] | In Process Research and Development [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Business combination recognized identifiable assets | 211 | ||
Fremanezumab [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
IPR&D to product rights | 174 | ||
International Markets [Member] | Discontinued business [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Impairment of intangible assets excluding goodwill | 123 | ||
Japan [Member] | Identifiable product rights [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Impairment of intangible assets excluding goodwill | $ 128 |
Goodwill - Summary of Changes i
Goodwill - Summary of Changes in the Carrying Amount of Goodwill by Segment (Detail) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |||
Goodwill [Line Items] | |||||
Beginning balance | [1] | $ 24,917 | $ 28,414 | ||
Goodwill impairment | (3,027) | [2] | $ (17,100) | ||
Goodwill disposal | (28) | (79) | [3] | ||
Goodwill reclassified as assets to held for sale | (20) | ||||
Translation differences and other | (43) | (371) | |||
Ending balance | [1] | 24,846 | 24,917 | 28,414 | |
North America [Member] | |||||
Goodwill [Line Items] | |||||
Beginning balance | [1] | 11,098 | 11,144 | ||
Goodwill disposal | (23) | ||||
Translation differences and other | 16 | (46) | |||
Ending balance | [1] | 11,091 | 11,098 | 11,144 | |
Europe [Member] | |||||
Goodwill [Line Items] | |||||
Beginning balance | [1] | 8,653 | 9,001 | ||
Goodwill disposal | (5) | (65) | [3] | ||
Goodwill reclassified as assets to held for sale | (3) | ||||
Translation differences and other | (112) | (280) | |||
Ending balance | [1] | 8,536 | 8,653 | 9,001 | |
International Markets [Member] | |||||
Goodwill [Line Items] | |||||
Beginning balance | [1] | 2,479 | 5,404 | ||
Goodwill impairment | [2] | (2,834) | |||
Goodwill disposal | [3] | (14) | |||
Translation differences and other | 53 | (77) | |||
Ending balance | [1] | 2,532 | 2,479 | 5,404 | |
Other [Member] | |||||
Goodwill [Line Items] | |||||
Beginning balance | [1] | 2,687 | 2,865 | ||
Goodwill impairment | [2] | (193) | |||
Goodwill reclassified as assets to held for sale | (17) | ||||
Translation differences and other | 32 | ||||
Ending balance | [1] | $ 2,687 | $ 2,687 | $ 2,865 | |
[1] | Accumulated goodwill impairment as of December 31, 2019, December 31, 2018 and January 1, 2018 was approximately $21.0 billion, $21.0 billion and $18.0 billion, respectively. | ||||
[2] | Goodwill impairment mainly attributable to the International Markets segment, Mexico and Medis. | ||||
[3] | Mainly due to the divestment of the women’s health business, the sale of Actavis Brazil and other activities. |
Goodwill - Summary of Changes_2
Goodwill - Summary of Changes in the Carrying Amount of Goodwill by Segment (Parenthetical) (Detail) - USD ($) $ in Billions | Dec. 31, 2019 | Dec. 31, 2018 | Jan. 01, 2018 |
Goodwill [Line Items] | |||
Accumulated goodwill impairment | $ 21 | $ 21 | $ 18 |
Goodwill - Additional Informati
Goodwill - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |||
Goodwill [Line Items] | |||||
Goodwill impairment | $ 3,027 | [1] | $ 17,100 | ||
International Markets [Member] | |||||
Goodwill [Line Items] | |||||
Goodwill impairment | [1] | $ 2,834 | |||
Decrease in estimated difference between fair value and carrying value, percent | 16.00% | ||||
Terminal Value Percentage Increase Or Decrease Threshold | 2.03% | ||||
Increase Or Decrease In The Discount Rate In Percentage Terms Threshold Limits | 9.80% | ||||
International Markets [Member] | Maximum [Member] | |||||
Goodwill [Line Items] | |||||
Terminal Value Percentage Increase Or Decrease Threshold | 1.53% | ||||
Increase Or Decrease In The Discount Rate In Percentage Terms Threshold Limits | 10.30% | ||||
Percentage difference between fair value and carrying value in respect of goodwill | 11.00% | ||||
International Markets [Member] | Minimum [Member] | |||||
Goodwill [Line Items] | |||||
Terminal Value Percentage Increase Or Decrease Threshold | 0.50% | ||||
Increase Or Decrease In The Discount Rate In Percentage Terms Threshold Limits | 0.50% | ||||
Percentage difference between fair value and carrying value in respect of goodwill | 9.00% | ||||
Europe [Member] | |||||
Goodwill [Line Items] | |||||
Decrease in estimated difference between fair value and carrying value, percent | 12.00% | ||||
Terminal Value Percentage Increase Or Decrease Threshold | 1.36% | ||||
Increase Or Decrease In The Discount Rate In Percentage Terms Threshold Limits | 9.52% | ||||
Europe [Member] | Maximum [Member] | |||||
Goodwill [Line Items] | |||||
Terminal Value Percentage Increase Or Decrease Threshold | 0.86% | ||||
Increase Or Decrease In The Discount Rate In Percentage Terms Threshold Limits | 10.02% | ||||
Percentage difference between fair value and carrying value in respect of goodwill | 8.00% | ||||
Europe [Member] | Minimum [Member] | |||||
Goodwill [Line Items] | |||||
Terminal Value Percentage Increase Or Decrease Threshold | 0.50% | ||||
Increase Or Decrease In The Discount Rate In Percentage Terms Threshold Limits | 0.50% | ||||
Percentage difference between fair value and carrying value in respect of goodwill | 6.00% | ||||
North America [Member] | |||||
Goodwill [Line Items] | |||||
Decrease in estimated difference between fair value and carrying value, percent | 26.00% | ||||
Terminal Value Percentage Increase Or Decrease Threshold | 1.61% | ||||
Increase Or Decrease In The Discount Rate In Percentage Terms Threshold Limits | 10.22% | ||||
North America [Member] | Maximum [Member] | |||||
Goodwill [Line Items] | |||||
Goodwill impairment | $ 1,230 | ||||
Terminal Value Percentage Increase Or Decrease Threshold | 1.11% | ||||
Increase Or Decrease In The Discount Rate In Percentage Terms Threshold Limits | 10.72% | ||||
Percentage difference between fair value and carrying value in respect of goodwill | 21.00% | ||||
North America [Member] | Minimum [Member] | |||||
Goodwill [Line Items] | |||||
Terminal Value Percentage Increase Or Decrease Threshold | 0.50% | ||||
Increase Or Decrease In The Discount Rate In Percentage Terms Threshold Limits | 0.50% | ||||
Percentage difference between fair value and carrying value in respect of goodwill | 18.00% | ||||
Medis [Member] | |||||
Goodwill [Line Items] | |||||
Decrease in estimated difference between fair value and carrying value, percent | 72.00% | ||||
TAPI [Member] | |||||
Goodwill [Line Items] | |||||
Decrease in estimated difference between fair value and carrying value, percent | 23.00% | ||||
[1] | Goodwill impairment mainly attributable to the International Markets segment, Mexico and Medis. |
Leases - Components of Lease Ex
Leases - Components of Lease Expense (Detail) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Operating lease cost: | |
Fixed payments and variable payments that depend on an index or rate | $ 166 |
Variable lease payments not included in the lease liability | 6 |
Short-term lease cost | 6 |
Total operating lease cost | $ 178 |
Leases - Supplemental cash flow
Leases - Supplemental cash flow information related to leases (Detail) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Cash paid for amounts included in the measurement of lease liabilities: | |
Operating cash flows from operating leases | $ 169 |
Right-of-use assets obtained in exchange for lease obligations (non-cash): | |
Operating leases | $ 142 |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information Related To Leases (Detail) $ in Millions | Dec. 31, 2019USD ($) |
Operating leases: | |
Operating lease ROU assets | $ 514 |
Other current liabilities | 118 |
Operating lease liabilities | 435 |
Total operating lease liabilities | $ 553 |
Weighted average Remaining Lease Term | 7 years 6 months |
Weighted average Discount Rate | 6.00% |
Leases - Maturities of lease l
Leases - Maturities of lease liabilities (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
2019 | $ 193 | |
2020 | $ 146 | 154 |
2021 | 117 | 118 |
2022 | 92 | 91 |
2023 | 66 | 66 |
2024 and thereafter | 298 | 283 |
Total operating lease payments | 719 | $ 905 |
Less: imputed interest | 166 | |
Present value of lease liabilities | $ 553 |
Leases - Additional Information
Leases - Additional Information (Detail) - USD ($) $ in Millions | Oct. 10, 2019 | Dec. 31, 2019 |
Lessee Operating Lease Not Yet Commenced | $ 92 | |
Term of contract, operating leases not yet commenced | 2020 years | |
Finance Lease, Right-of-Use Asset | $ 37 | |
Finance Lease, Liability | $ 29 | |
Israel [Member] | ||
Proceeds from sale of assets | $ 128 | |
Maximum [Member] | ||
Term of contract, operating leases not yet commenced | 12 years | |
Minimum [Member] | ||
Term of contract, operating leases not yet commenced | 9 years |
Debt Obligations - Schedule of
Debt Obligations - Schedule of Short-term Debt (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Debt Instrument [Line Items] | ||
Current maturities of long-term liabilities | $ 1,831 | $ 1,700 |
Total short term debt | $ 2,345 | 2,216 |
Term loan JPY 28.3 billion [Member] | ||
Debt Instrument [Line Items] | ||
Weighted average interest rate | 0.25% | |
Banks And Financial Institutions [Member] | ||
Debt Instrument [Line Items] | ||
Short-term borrowings | 2 | |
Convertible debentures [Member] | ||
Debt Instrument [Line Items] | ||
Maturity | 2026 | |
Short-term borrowings | $ 514 | $ 514 |
Debt Obligations - Schedule o_2
Debt Obligations - Schedule of Senior Notes and Loans (Detail) - USD ($) $ in Millions | 12 Months Ended | |||||
Dec. 31, 2018 | Dec. 31, 2019 | Nov. 30, 2019 | Jul. 31, 2019 | |||
Debt Instrument [Line Items] | ||||||
Total senior notes | $ 28,483 | $ 26,496 | ||||
Less current maturities | (1,700) | (1,831) | ||||
Derivative instruments | 9 | 0 | ||||
Less debt issuance costs | (104) | (103) | ||||
Total senior notes and loans | $ 26,700 | $ 24,562 | ||||
Other Debentures [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 1.13% | |||||
Maturity | 2026 | |||||
Total senior notes and loans | $ 12 | $ 1 | ||||
Senior notes EUR 1,010 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | [1] | 0.38% | ||||
Maturity | [1] | 2020 | ||||
Total senior notes | [1] | $ 1,897 | $ 1,131 | |||
Senior notes EUR 1,500 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 1.13% | |||||
Maturity | 2024 | |||||
Total senior notes | $ 1,707 | $ 1,673 | ||||
Senior notes EUR 1,300 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 1.25% | |||||
Maturity | 2023 | |||||
Total senior notes | $ 1,480 | $ 1,451 | ||||
Senior notes EUR 900 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 4.50% | |||||
Maturity | 2025 | |||||
Total senior notes | $ 1,029 | $ 1,008 | ||||
Senior notes EUR 750 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 1.63% | |||||
Maturity | 2028 | |||||
Total senior notes | $ 850 | $ 833 | ||||
Senior notes EUR 700 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 3.25% | |||||
Maturity | 2022 | |||||
Total senior notes | $ 801 | $ 784 | ||||
Senior notes EUR 700 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 1.88% | |||||
Maturity | 2027 | |||||
Total senior notes | $ 798 | $ 782 | ||||
Senior notes EUR 1,000 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 6.00% | [2] | 6.00% | |||
Maturity | [2] | 2025 | ||||
Total senior notes | [2] | $ 1,120 | ||||
Senior notes USD 1,000 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 7.13% | [3] | 7.125% | |||
Maturity | [3] | 2025 | ||||
Total senior notes | [3] | $ 1,000 | ||||
Senior notes USD 3,500 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 3.15% | |||||
Maturity | 2026 | |||||
Total senior notes | $ 3,493 | $ 3,494 | ||||
Senior notes USD 1,475 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 2.20% | [4] | 2.20% | |||
Maturity | [4] | 2021 | ||||
Total senior notes | [4] | $ 2,997 | $ 1,474 | |||
Senior notes USD 3,000 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 2.80% | |||||
Maturity | 2023 | |||||
Total senior notes | $ 2,993 | $ 2,995 | ||||
Senior notes USD 1,556 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 1.70% | [5] | 1.70% | |||
Maturity | [5] | 2019 | ||||
Total senior notes | [5] | $ 1,700 | ||||
Senior notes USD 2,000 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 4.10% | |||||
Maturity | 2046 | |||||
Total senior notes | $ 1,985 | $ 1,985 | ||||
Senior notes USD 1,250 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 6.00% | |||||
Maturity | 2024 | |||||
Total senior notes | $ 1,250 | $ 1,250 | ||||
Senior notes USD 1,250 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 6.75% | |||||
Maturity | 2028 | |||||
Total senior notes | $ 1,250 | $ 1,250 | ||||
Senior notes USD 844 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 2.95% | |||||
Maturity | 2022 | |||||
Total senior notes | $ 860 | $ 856 | ||||
Senior notes USD 789 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 6.15% | |||||
Maturity | 2036 | |||||
Total senior notes | $ 782 | $ 782 | ||||
Senior notes USD 700 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 2.25% | |||||
Maturity | 2020 | |||||
Total senior notes | $ 700 | $ 700 | ||||
Senior notes USD 613 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 3.65% | |||||
Maturity | 2021 | |||||
Total senior notes | $ 621 | $ 618 | ||||
Senior notes USD 588 million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 3.65% | |||||
Maturity | 2021 | |||||
Total senior notes | $ 587 | $ 587 | ||||
Senior notes CHF 350 Million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 0.50% | |||||
Maturity | 2022 | |||||
Total senior notes | $ 356 | $ 361 | ||||
Senior notes CHF 350 Million [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 1.00% | |||||
Maturity | 2025 | |||||
Total senior notes | $ 356 | $ 362 | ||||
Hedge Accounting Adjustments [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Total senior notes | $ (9) | |||||
[1] | In December 2019, Teva consummated an early redemption of 650 million Euro of its 1,660 million Euro 0.375% senior notes due in July 2020. | |||||
[2] | In November 2019, Teva Pharmaceutical Finance Netherlands II B.V, a Teva finance subsidiary, issued senior notes in an aggregate principal amount of 1,000 million Euro. | |||||
[3] | In November 2019, Teva Pharmaceutical Finance Netherlands III B.V, a Teva finance subsidiary, issued senior notes in an aggregate principal amount of $1,000 million. | |||||
[4] | In November 2019, Teva consummated a cash tender offer for its $3,000 million 2.2% senior notes due in July 2021. As a result of the offer, Teva redeemed $1,525 million aggregate principal amount of this senior note. | |||||
[5] | During the first six months of 2019, Teva repurchased and canceled approximately $144 million principal amount of its $1,700 million 1.7% senior notes due in July 2019. In July 2019, Teva repaid at maturity $1,556 million of its 1.7% senior notes. |
Debt Obligations - Schedule o_3
Debt Obligations - Schedule of Senior Notes and Loans (Parenthetical) (Detail) € in Millions, SFr in Millions, $ in Millions | Dec. 31, 2019EUR (€) | Dec. 31, 2019USD ($) | Dec. 31, 2019CHF (SFr) | Nov. 30, 2019USD ($) |
Senior notes EUR 1,660 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | € | € 1,010 | |||
Senior notes EUR 1,500 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | € | 1,500 | |||
Senior notes EUR 1,300 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | € | 1,300 | |||
Senior notes EUR 900 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | € | 900 | |||
Senior notes EUR 750 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | € | 750 | |||
Senior notes EUR 700 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | € | 700 | |||
Senior notes EUR 700 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | € | 700 | |||
Senior notes EUR 1,000 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | € | € 1,000 | |||
Senior notes USD 1,000 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | $ 1,000 | |||
Senior notes USD 3,500 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | 3,500 | |||
Senior notes USD 3,000 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | 1,475 | $ 3,000 | ||
Senior notes USD 3,000 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | 3,000 | |||
Senior notes USD 1,556 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | 1,556 | |||
Senior notes USD 2,000 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | 2,000 | |||
Senior notes USD 1,250 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | 1,250 | |||
Senior notes USD 1,250 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | 1,250 | |||
Senior notes USD 844 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | 844 | |||
Senior notes USD 789 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | 789 | |||
Senior notes USD 700 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | 700 | |||
Senior notes USD 613 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | 613 | |||
Senior notes USD 588 million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | $ 588 | |||
Senior notes CHF 350 Million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | SFr | SFr 350 | |||
Senior notes CHF 350 Million [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | SFr | SFr 350 |
Debt Obligation - Schedule Requ
Debt Obligation - Schedule Required Annual Principal Payments of Long-term Debt, Excluding Debt Issuance Cost (Detail) $ in Millions | Dec. 31, 2019USD ($) |
Long Term Debt Maturity [Line Items] | |
2021 | $ 2,679 |
2022 | 2,002 |
2023 | 4,446 |
2024 | 2,923 |
2025 and thereafter | 13,131 |
Total | $ 25,181 |
Debt Obligations - Additional I
Debt Obligations - Additional Information (Detail) € in Millions, $ in Millions | 1 Months Ended | 12 Months Ended | ||||||||||
Jul. 31, 2019USD ($) | Dec. 31, 2019EUR (€) | Dec. 31, 2019USD ($) | Nov. 30, 2019USD ($) | Nov. 15, 2019USD ($) | Jun. 30, 2019USD ($) | Apr. 30, 2019USD ($) | Dec. 31, 2018USD ($) | Nov. 30, 2015USD ($) | ||||
Debt Instrument [Line Items] | ||||||||||||
Revolving credit facility | $ 2,300 | $ 3,000 | ||||||||||
Senior notes | $ 26,496 | $ 28,483 | ||||||||||
Debt instrument redeemed amount | $ 2,300 | |||||||||||
Long term debt currency portion USD | 66.00% | 66.00% | ||||||||||
Long term debt currency portion EUR | 31.00% | 31.00% | ||||||||||
Long term debt currency portion CHF | 3.00% | 3.00% | ||||||||||
Netherlands II B.V. [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Senior notes | $ 1,000 | |||||||||||
Netherlands III B.V. [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Senior notes | 1,000 | |||||||||||
Senior notes USD 1,700 million [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Senior notes | [1] | 1,700 | ||||||||||
Debt instrument face amount | $ 1,556 | |||||||||||
Weighted average interest rate | 1.70% | 1.70% | [1] | 1.70% | [1] | |||||||
Repayments of short-term debt | $ 1,556 | |||||||||||
Senior notes USD 1,700 million [Member] | Senior Notes [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Senior notes | $ 1,700 | |||||||||||
Debt instrument redeemed amount | $ 144 | |||||||||||
Weighted average interest rate | 1.70% | |||||||||||
Senior notes EUR 1,660 million [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Senior notes | [2] | $ 1,131 | 1,897 | |||||||||
Debt instrument redemption amount | € | € 650 | |||||||||||
Debt instrument face amount | € | € 1,010 | |||||||||||
Weighted average interest rate | [2] | 0.38% | 0.38% | |||||||||
Senior notes USD 3,000 million [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Senior notes | [3] | $ 1,474 | 2,997 | |||||||||
Debt instrument redemption amount | 1,525 | |||||||||||
Debt instrument face amount | $ 1,475 | $ 3,000 | ||||||||||
Weighted average interest rate | 2.20% | [3] | 2.20% | [3] | 2.20% | |||||||
Senior notes USD 1,000 million [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Senior notes | [4] | $ 1,120 | ||||||||||
Debt instrument face amount | € | € 1,000 | |||||||||||
Weighted average interest rate | 6.00% | [4] | 6.00% | [4] | 6.00% | |||||||
Senior notes USD 1,000 million [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Senior notes | [5] | $ 1,000 | ||||||||||
Debt instrument face amount | $ 1,000 | |||||||||||
Weighted average interest rate | 7.13% | [5] | 7.13% | [5] | 7.125% | |||||||
Convertible Debt [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Weighted average interest rate | 0.25% | 0.25% | ||||||||||
Principal amount currently outstanding on the debt instruments | $ 514 | $ 514 | ||||||||||
Revolving Credit Facility [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Debt Instrument, Covenant Description | The net debt to EBITDA ratio limit was 6.25x through December 31, 2019, gradually declines to 5.75x in the third and fourth quarters of 2020, and continues to gradually decline over the remaining term of the RCF. | |||||||||||
Long Term Debt Payable Under Revolving Credit Facility | $ 0 | |||||||||||
[1] | During the first six months of 2019, Teva repurchased and canceled approximately $144 million principal amount of its $1,700 million 1.7% senior notes due in July 2019. In July 2019, Teva repaid at maturity $1,556 million of its 1.7% senior notes. | |||||||||||
[2] | In December 2019, Teva consummated an early redemption of 650 million Euro of its 1,660 million Euro 0.375% senior notes due in July 2020. | |||||||||||
[3] | In November 2019, Teva consummated a cash tender offer for its $3,000 million 2.2% senior notes due in July 2021. As a result of the offer, Teva redeemed $1,525 million aggregate principal amount of this senior note. | |||||||||||
[4] | In November 2019, Teva Pharmaceutical Finance Netherlands II B.V, a Teva finance subsidiary, issued senior notes in an aggregate principal amount of 1,000 million Euro. | |||||||||||
[5] | In November 2019, Teva Pharmaceutical Finance Netherlands III B.V, a Teva finance subsidiary, issued senior notes in an aggregate principal amount of $1,000 million. |
Derivative Instruments and He_3
Derivative Instruments and Hedging Activities - Summary of Notional Amounts for Hedged Items, Designated as Hedge Accounting (Detail) - Designated as Hedging Instrument [Member] - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Liabilities Derivatives - Interest Rate and Cross Currency Swaps [Member] | Cash Flow Hedge [Member] | ||
Derivative [Line Items] | ||
Notional amounts of hedge | $ 588 | |
Liabilities Derivatives - Interest Rate and Cross Currency Swaps [Member] | Net Investment Hedge [Member] | ||
Derivative [Line Items] | ||
Notional amounts of hedge | $ 1,000 | 1,000 |
Asset Derivatives - Options and Forward Contracts [Member] | Fair Value Hedge [Member] | ||
Derivative [Line Items] | ||
Notional amounts of hedge | $ 500 |
Derivative Instruments and He_4
Derivative Instruments and Hedging Activities - Summary of Classification and Fair Values of Derivative Instruments (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Designated as Hedging Instrument [Member] | Swap [Member] | Other Non-current Assets [Member] | Net Investment Hedging [Member] | ||
Derivative [Line Items] | ||
Liability derivatives | $ (22) | |
Designated as Hedging Instrument [Member] | Swap [Member] | Accounts Payable [Member] | Cash Flow Hedge [Member] | ||
Derivative [Line Items] | ||
Asset derivatives | 0 | $ 58 |
Designated as Hedging Instrument [Member] | Swap [Member] | Other Current Liabilities [Member] | Fair Value Hedge [Member] | ||
Derivative [Line Items] | ||
Liability derivatives | (9) | |
Designated as Hedging Instrument [Member] | Liabilities Derivatives - Interest Rate and Cross Currency Swaps [Member] | Accounts Payable [Member] | ||
Derivative [Line Items] | ||
Liability derivatives | (41) | |
Not Designated as Hedging Instrument [Member] | Foreign Exchange Contract [Member] | Accounts Payable [Member] | ||
Derivative [Line Items] | ||
Liability derivatives | (41) | (26) |
Not Designated as Hedging Instrument [Member] | Foreign Exchange Contract [Member] | Other Current Assets [Member] | ||
Derivative [Line Items] | ||
Asset derivatives | $ 32 | $ 18 |
Derivative Instruments and He_5
Derivative Instruments and Hedging Activities - Information Regarding The Location And Amount Of Pretax (Gains) Losses Of Derivatives Designated In Fair Value Or Cash Flow Hedging Relationships (Details) - Designated as Hedging Instrument [Member] - USD ($) $ in Millions | 12 Months Ended | |||||
Dec. 31, 2019 | Dec. 31, 2018 | [1] | Dec. 31, 2017 | [1] | ||
Other Comprehensive Income | ||||||
Derivative [Line Items] | ||||||
Gain (Loss) on Derivative Instruments, Net, Pretax | $ 160 | $ (585) | $ 1,369 | |||
Other Comprehensive Income | Cash Flow Hedging [Member] | ||||||
Derivative [Line Items] | ||||||
Gain (Loss) on Derivative Instruments, Net, Pretax | [2] | (33) | (35) | 71 | ||
Other Comprehensive Income | Net Investment Hedging [Member] | ||||||
Derivative [Line Items] | ||||||
Gain (Loss) on Derivative Instruments, Net, Pretax | [3] | (22) | (51) | 97 | ||
Financial expenses [Member] | ||||||
Derivative [Line Items] | ||||||
Gain (Loss) on Derivative Instruments, Net, Pretax | 822 | 959 | 895 | |||
Financial expenses [Member] | Cash Flow Hedging [Member] | ||||||
Derivative [Line Items] | ||||||
Gain (Loss) on Derivative Instruments, Net, Pretax | [2] | (2) | (2) | (3) | ||
Financial expenses [Member] | Net Investment Hedging [Member] | ||||||
Derivative [Line Items] | ||||||
Gain (Loss) on Derivative Instruments, Net, Pretax | [3] | (29) | $ (31) | (13) | ||
Financial expenses [Member] | Fair Value Hedging [Member] | ||||||
Derivative [Line Items] | ||||||
Gain (Loss) on Derivative Instruments, Net, Pretax | [4] | $ 2 | $ (4) | |||
[1] | Comparative figures are based on prior hedge accounting standard. | |||||
[2] | With respect to cross-currency swap agreements, Teva recognized gains which mainly reflect the differences between the fixed interest rate and the floating interest rate. In the fourth quarter of 2019, Teva terminated cross-currency swap agreements against its outstanding 3.65% senior notes maturing in November 2021. The settlement of these transactions resulted in cash proceeds of $95 million. The cash flow hedge accounting adjustments of these instruments, which are recorded under senior notes and loans, are amortized under financial expenses-net over the life of the debt as additional interest expense. | |||||
[3] | In each of the first and second quarters of 2017, Teva entered into a cross currency swap agreement with a notional amount of $500 million maturing in 2020. These cross currency swaps were designated as a net investment hedge of Teva’s foreign subsidiaries euro denominated net assets, in order to reduce the risk of adverse exchange rate fluctuations. With respect to these cross currency swap agreements, Teva recognized gains which mainly reflect the differences between the float-for-float interest rates paid in euros and received in U.S. dollar. No amounts were reclassified from accumulated other comprehensive income into income related to the sale of a subsidiary. | |||||
[4] | In the fourth quarter of 2016, Teva entered into an interest rate swap agreement designated as fair value hedge relating to its 2.8% senior notes due 2023 with respect to $500 million notional amount of outstanding debt. With respect to this interest rate swap agreement, Teva recognized a loss which mainly reflects the differences between the fixed interest rate and the floating interest rate. In the third quarter of 2019, Teva terminated this interest rate swap agreement. The settlement of these transactions resulted in cash proceeds of $10 million. The fair value hedge accounting adjustments of fair value hedge instruments, which are recorded under senior notes and loans, are amortized under financial expenses-net over the life of the debt as additional interest expense. |
Derivative Instruments and He_6
Derivative Instruments and Hedging Activities - Schedule Of Other Derivatives Not Designated As Hedging Instruments Statements OfFinancial Performance And Financial Position Location (Details) - USD ($) $ in Millions | 12 Months Ended | |||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||||
Net Revenues [Member] | Not Designated as Hedging Instrument [Member] | ||||||
Derivative [Line Items] | ||||||
Gain (Loss) on Derivative Instruments, Net, Pretax | $ 16,887 | $ 18,271 | [1] | $ 21,853 | [1] | |
Net Revenues [Member] | Not Designated as Hedging Instrument, Economic Hedge [Member] | ||||||
Derivative [Line Items] | ||||||
Gain (Loss) on Derivative Instruments, Net, Pretax | [2] | 14 | (4) | |||
Financial expenses [Member] | Not Designated as Hedging Instrument [Member] | ||||||
Derivative [Line Items] | ||||||
Gain (Loss) on Derivative Instruments, Net, Pretax | 822 | 959 | [1] | 895 | [1] | |
Financial expenses [Member] | Not Designated as Hedging Instrument, Trading [Member] | ||||||
Derivative [Line Items] | ||||||
Gain (Loss) on Derivative Instruments, Net, Pretax | [3] | $ (51) | $ (12) | $ 82 | ||
[1] | Comparative figures are based on prior hedge accounting standard. | |||||
[2] | Teva entered into option and forward contracts designed to limit the exposure of foreign exchange fluctuations on revenues and expenses recorded in euro, the British pound, the Russian ruble and some other currencies during the quarter for which such instruments are purchased. These derivative instruments do not meet the criteria for hedge accounting, however, they are accounted for as economic hedge. These derivative instruments are recognized on the Balance Sheet at their fair value, with changes in the fair value recognized under the same line item in the Statements of Income as the underlying exposure being hedged. The cash flows associated with these derivatives are reflected as cash flows from operating activities in the consolidated Statements of Cash Flows. | |||||
[3] | Teva uses foreign exchange contracts (mainly option and forward contracts) to hedge balance sheet items from currency exposure. These foreign exchange contracts are not designated as hedging instruments for accounting purposes. In connection with these foreign exchange contracts, Teva recognizes gains or losses that offset the revaluation of the balance sheet items also recorded under financial expenses—net. |
Derivative Instruments and He_7
Derivative Instruments and Hedging Activities - Summary of Sold Receivables Outstanding Balance Net of DPP Asset under Outstanding Securitization Program (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Derivative [Line Items] | ||
Sold receivables at the beginning of the year | $ 686 | $ 799 |
Proceeds from sale of receivables | 4,852 | 5,071 |
Cash collections (remitted to the owner of the receivables) | (4,849) | (5,151) |
Effect of currency exchange rate changes | 1 | (33) |
Sold receivables at the end of the year | $ 690 | $ 686 |
Derivative Instruments and He_8
Derivative Instruments and Hedging Activities - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||||||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2019 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jul. 31, 2016 | |
Derivative [Line Items] | |||||||||
Revenues other than USD | 48.00% | ||||||||
Teva other comprehensive loss | $ 493 | ||||||||
Transactions termination loss settled | 242 | ||||||||
Forward starting interest rate swaps and treasury lock agreements losses | 29 | $ 28 | $ 27 | ||||||
Interest Rate Swap Gain | 6 | 6 | 7 | ||||||
Deferred purchase asset | 250 | 231 | |||||||
Sold receivables | 690 | $ 686 | $ 799 | ||||||
Senior Notes Due 2023 Two [Member] | |||||||||
Derivative [Line Items] | |||||||||
Notional amount hedge debt | $ 500 | $ 500 | $ 3,000 | ||||||
Previously hedge debt rate | 2.80% | ||||||||
Cash received on settlement of position | $ 10 | $ 10 | |||||||
Senior Notes Due 2022 [Member] | |||||||||
Derivative [Line Items] | |||||||||
Previously hedge debt rate | 2.80% | ||||||||
Asset Derivatives - Options and Forward Contracts [Member] | Cash Flow Hedge [Member] | |||||||||
Derivative [Line Items] | |||||||||
Notional amount hedge debt | $ 3,750 | ||||||||
Treasury Lock [Member] | Cash Flow Hedge [Member] | |||||||||
Derivative [Line Items] | |||||||||
Notional amount hedge debt | $ 1,500 | ||||||||
Senior Notes Due 2021 [Member] | |||||||||
Derivative [Line Items] | |||||||||
Notional amount hedge debt | $ 588 | ||||||||
Previously hedge debt rate | 3.65% | ||||||||
Cash received on settlement of position | $ 95 | ||||||||
Senior Notes Due 2020 [Member] | |||||||||
Derivative [Line Items] | |||||||||
Notional amount hedge debt | $ 500 | $ 500 | |||||||
Senior Notes Due 2021 Two [Member] | |||||||||
Derivative [Line Items] | |||||||||
Previously hedge debt rate | 3.65% | ||||||||
Cash received on settlement of position | $ 95 |
Legal Settlements and Loss Co_2
Legal Settlements and Loss Contingencies - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Loss Contingencies [Line Items] | |||
Legal settlements and loss contingencies, expense | $ 1,178 | $ 500 | |
Legal settlements, income | $ 1,208 | ||
Accrued amount for legal settlements and loss contingencies | $ 1,580 | $ 562 |
Commitments and Contingencies -
Commitments and Contingencies - Commitments - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Commitment And Contingencies [Line Items] | |||
Royalty expense | $ 403,000,000 | $ 536,000,000 | $ 956,000,000 |
Maximum [Member] | |||
Commitment And Contingencies [Line Items] | |||
Milestone contingent expense | $ 426,000,000 |
Commitments and Contingencies_2
Commitments and Contingencies - Contingencies - Additional Information (Detail) € in Millions, $ in Millions, $ in Millions | Oct. 21, 2019USD ($)Number | Oct. 04, 2018USD ($) | Jun. 27, 2018CAD ($) | Aug. 21, 2017USD ($) | Jul. 15, 2015USD ($) | Aug. 31, 2013USD ($) | May 31, 2019USD ($) | Jul. 31, 2015USD ($) | Sep. 30, 2013USD ($) | Apr. 30, 2013USD ($) | Aug. 31, 2012USD ($) | Dec. 31, 2010USD ($) | Nov. 30, 2009USD ($) | Aug. 31, 2008USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2014CAD ($) | Dec. 31, 2019CAD ($) | Dec. 31, 2019EUR (€) | Dec. 31, 2019USD ($) | Dec. 31, 2016USD ($) | May 31, 2015USD ($) | Dec. 31, 2014USD ($) | Mar. 31, 2014USD ($) | Jan. 31, 2009USD ($) | Jul. 31, 2008USD ($) | Feb. 28, 2005USD ($) |
Commitment And Contingencies [Line Items] | |||||||||||||||||||||||||||
Damages assessment | $ 235.5 | ||||||||||||||||||||||||||
Sales | $ 94 | ||||||||||||||||||||||||||
Modafinil payment | $ 1,200 | ||||||||||||||||||||||||||
Modafinil Euro sales | € | € 46.5 | ||||||||||||||||||||||||||
Annual sales at the time of settlement | $ 350 | ||||||||||||||||||||||||||
Annual sales of Effexor | $ 2,600 | ||||||||||||||||||||||||||
Annual sales of Lamictal | $ 2,300 | $ 950 | |||||||||||||||||||||||||
Annual sales of Niaspan | $ 1,100 | $ 416 | |||||||||||||||||||||||||
Annual sales of Aggrenox | $ 455 | $ 340 | |||||||||||||||||||||||||
Annual sales of Actos | $ 2,800 | $ 3,700 | |||||||||||||||||||||||||
Annual sales of Acto plus | $ 430 | $ 500 | |||||||||||||||||||||||||
Annual sales of Namenda | $ 550 | $ 1,100 | |||||||||||||||||||||||||
Annual sales of Intuniv | $ 335 | $ 327 | |||||||||||||||||||||||||
Punitive damages | $ 17.9 | ||||||||||||||||||||||||||
Litigation settlement amount | $ 135 | ||||||||||||||||||||||||||
Loss contingency payment | $ 12.4 | $ 25 | |||||||||||||||||||||||||
Annual Sales Of Sensipar | 1,400 | ||||||||||||||||||||||||||
Modafinil payment remaining balance | $ 19 | ||||||||||||||||||||||||||
opioid litigation [Member] | |||||||||||||||||||||||||||
Commitment And Contingencies [Line Items] | |||||||||||||||||||||||||||
Litigation settlement amount | $ 85 | ||||||||||||||||||||||||||
Litigation settlement amount awarded distribution period | 3 years | ||||||||||||||||||||||||||
Litigation settlement amount awarded cash amount | $ 20 | ||||||||||||||||||||||||||
Litigation settlement amount awarded number of installments | Number | 4 | ||||||||||||||||||||||||||
Litigation settlement amount awarded cash amount distribution period | 3 years | ||||||||||||||||||||||||||
Nationwide Settlement [Member] | |||||||||||||||||||||||||||
Commitment And Contingencies [Line Items] | |||||||||||||||||||||||||||
Litigation settlement amount | $ 23,000 | ||||||||||||||||||||||||||
Litigation settlement amount awarded distribution period | 10 years | ||||||||||||||||||||||||||
Litigation settlement amount awarded cash amount | $ 250 | ||||||||||||||||||||||||||
Litigation settlement amount awarded cash amount distribution period | 10 years | ||||||||||||||||||||||||||
Eosinophilic Esophagitis [Member] | |||||||||||||||||||||||||||
Commitment And Contingencies [Line Items] | |||||||||||||||||||||||||||
Damage claimed | 200 | ||||||||||||||||||||||||||
Eosinophilic Esophagitis [Member] | United States [Member] | |||||||||||||||||||||||||||
Commitment And Contingencies [Line Items] | |||||||||||||||||||||||||||
Damage claimed | 150 | ||||||||||||||||||||||||||
Eosinophilic Esophagitis [Member] | Europe [Member] | |||||||||||||||||||||||||||
Commitment And Contingencies [Line Items] | |||||||||||||||||||||||||||
Damage claimed | $ 50 | ||||||||||||||||||||||||||
AbbVie [Member] | |||||||||||||||||||||||||||
Commitment And Contingencies [Line Items] | |||||||||||||||||||||||||||
Legal fees | $ 448 | ||||||||||||||||||||||||||
Janssen and Millennium [Member] | |||||||||||||||||||||||||||
Commitment And Contingencies [Line Items] | |||||||||||||||||||||||||||
Maximum damages payable | $ 200 | ||||||||||||||||||||||||||
Litigation settlement awarded from other party | $ 5 | ||||||||||||||||||||||||||
AndroGel Rate at 1% [Member] | |||||||||||||||||||||||||||
Commitment And Contingencies [Line Items] | |||||||||||||||||||||||||||
Annual sales at the time of settlement | $ 140 |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income Before Income Taxes (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Before Income Taxes And Income Tax Expense Benefit [Line Items] | |||
Parent Company and its Israeli subsidiaries | $ 542 | $ 1,022 | $ 1,451 |
Non-Israeli subsidiaries | (1,807) | (3,618) | (19,830) |
Income (loss) before income taxes | $ (1,265) | $ (2,596) | $ (18,379) |
Income Taxes - Schedule of the
Income Taxes - Schedule of the Provision for Income Taxes (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Before Income Taxes And Income Tax Expense Benefit [Line Items] | |||
In Israel | $ 107 | $ 131 | $ 96 |
Outside Israel | (385) | (326) | (2,029) |
Effective consolidated income taxes | (278) | (195) | (1,933) |
Current | 885 | 700 | 373 |
Deferred | (1,163) | (895) | (2,306) |
Income tax expense (benefit) | $ (278) | $ (195) | $ (1,933) |
Income Taxes - Accumulated Othe
Income Taxes - Accumulated Other Comprehensive Income/(Loss) (Net of Tax) (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Income Before Income Taxes And Income Tax Expense Benefit [Line Items] | ||||
Income (Loss) before income taxes | $ (1,265) | $ (2,596) | $ (18,379) | |
Statutory tax rate in Israel | 23.00% | 23.00% | 24.00% | |
Theoretical provision for income taxes | $ (291) | $ (597) | $ (4,411) | |
Increase (decrease) in effective tax rate due to: | ||||
The Parent Company and its Israeli subsidiaries- Mainly tax benefits arising from reduced tax rates under benefit programs | (44) | (134) | (253) | |
Non-Israeli subsidiaries, including impairments | [1] | (115) | 381 | 3,817 |
U.S. Tax Cuts and Jobs Act effect | 97 | (1,061) | ||
Increase (decrease) in other uncertain tax positions-net | 172 | 58 | (25) | |
Effective consolidated income taxes | $ (278) | $ (195) | $ (1,933) | |
[1] | In 2019, income before income taxes includes intangible impairments in non-Israeli subsidiaries with a corresponding tax effect. In 2017 and 2018, income before income taxes includes goodwill impairments in non-Israeli subsidiaries that did not have a corresponding tax effect. |
Income Taxes - Accumulated Ot_2
Income Taxes - Accumulated Other Comprehensive Income/(Loss) (Net of Tax) (Parenthetical) (Detail) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income Before Income Taxes And Income Tax Expense Benefit [Line Items] | ||
Income before income taxes includes goodwill impairment tax effect | $ 0 | $ 0 |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Defered Income Taxes (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | |
Deferred Tax Assets Liabilities Net [Line Items] | |||
Inventory related | $ 144 | $ 113 | |
Sales reserves and allowances | 198 | 199 | |
Provision for legal settlements | 260 | 42 | |
Intangible assets | [1] | (1,733) | (2,282) |
Carryforward losses and deductions and credits | [2] | 1,689 | 1,340 |
Property, plant and equipment | (170) | (167) | |
Deferred interest | 648 | 391 | |
Provisions for employee related obligations | 106 | 102 | |
Other | 122 | 123 | |
Long-term deferred tax assets (liabilities)-gross | 1,264 | (139) | |
Valuation allowance-in respect of carryforward losses and deductions that may not be utilized | (1,974) | (1,633) | |
Deferred tax assets liabilities net | $ (710) | $ (1,772) | |
[1] | The decrease in deferred tax liability is mainly due to impairment and amortization. | ||
[2] | The amounts are shown after reduction for unrecognized tax benefits of $ 115 million and $35 million as of December 31, 2019 and 2018, respectively. |
Income Taxes - Schedule of De_2
Income Taxes - Schedule of Defered Income Taxes (Parenthetical) (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred Tax Assets Liabilities Net [Line Items] | ||
Unrecognized tax benefits | $ 115 | $ 35 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) ₪ in Millions, $ in Millions | Jan. 01, 2017 | Jul. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2019ILS (₪)Employee | Dec. 31, 2019USD ($)Employee | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016 |
Income Tax [Line Items] | |||||||||||||||
Balance of accrued potential penalties and interest in unrecognized tax benefits | $ 164 | $ 131 | $ 164 | $ 131 | $ 112 | ||||||||||
Unrecognized Tax Benefits Income Tax Penalties And Interest Expense | $ 33 | $ 19 | $ 29 | ||||||||||||
Statutory tax rate in Israel | 23.00% | 23.00% | 23.00% | 24.00% | |||||||||||
Annual revenue | 4,468 | $ 4,093 | $ 4,177 | $ 4,149 | $ 4,419 | $ 4,385 | $ 4,552 | $ 4,916 | $ 16,887 | $ 18,271 | $ 21,853 | ||||
Effective income tax rate | 21.00% | 35.00% | |||||||||||||
Tax benefit related to Tax Cuts And Jobs Act | $ 1,200 | ||||||||||||||
Provisional estimate for one-time deemed repatriation tax liability | $ 97 | $ 112 | |||||||||||||
Subsequent Event [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Expected impairment of income tax benefit | $ 146 | ||||||||||||||
Israel Tax Authority [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Income tax audit period | 2008 2009 2010 2011 | 2008 2009 2010 2011 | |||||||||||||
Withholding tax percentage on dividends | 8.00% | ||||||||||||||
Israel Tax Authority [Member] | Tax Year 2005 To 2007 [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Income tax settlement amount | $ 213 | ||||||||||||||
Tax Carryforwards And Deductions Expiration Period One [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Tax effect of unspecified carryforward losses and deductions | 61 | 61 | |||||||||||||
Tax Carryforwards And Deductions Expiration Period Two [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Tax effect of unspecified carryforward losses and deductions | 672 | 672 | |||||||||||||
Tax Carryforwards And Deductions No Expiration [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Tax effect of unspecified carryforward losses and deductions | 193 | 193 | |||||||||||||
Tax Carryforwards And Deductions Indefinite [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Tax effect of unspecified carryforward losses and deductions | 879 | 879 | |||||||||||||
Amendment 69 to Investment Law [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Payment of corporate tax | 577 | ||||||||||||||
Exempt Income | 9,400 | ||||||||||||||
Amendment 68 to Investment Law [Member] | Israel Tax Authority [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Statutory tax rate in Israel | 16.00% | ||||||||||||||
Amendment 68 to Investment Law [Member] | Israel Tax Authority [Member] | Development Zonea [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Statutory tax rate in Israel | 9.00% | ||||||||||||||
Amendment 73 to Investment Law [Member] | Israel Tax Authority [Member] | Development Zonea [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Statutory tax rate in Israel | 7.50% | ||||||||||||||
Preferred Enterprise [Member] | Israel Tax Authority [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Withholding tax percentage on dividends | 20.00% | ||||||||||||||
Preferred Enterprise [Member] | Israel Tax Authority [Member] | Development Zonea [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Withholding tax percentage on dividends | 5.00% | ||||||||||||||
Preferred Technological Enterprises [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Venture capital investment | $ 2 | $ 2 | |||||||||||||
Average growth rate in sales or workforce | 25.00% | 25.00% | |||||||||||||
Average growth preceding period in sales or workforce | 3 years | 3 years | |||||||||||||
Preferred Technological Enterprises [Member] | Research and Development Arrangement [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Minimum percentage of investment income | 7.00% | 7.00% | |||||||||||||
Minimum investment income | ₪ 75 | $ 22 | |||||||||||||
Minimum percentage of workforce | 20.00% | 20.00% | |||||||||||||
Minimum number of employees employed | Employee | 200 | 200 | |||||||||||||
Preferred Technological Enterprises [Member] | Israel Tax Authority [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Statutory tax rate in Israel | 12.00% | 12.00% | |||||||||||||
Preferred Technological Enterprises [Member] | Israel Tax Authority [Member] | Development Zonea [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Statutory tax rate in Israel | 7.50% | 7.50% | |||||||||||||
Special Preferred Technological Enterprise [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Annual revenue | ₪ 10,000 | $ 2,900 | |||||||||||||
Special Preferred Technological Enterprise [Member] | Israel Tax Authority [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Statutory tax rate in Israel | 6.00% | 6.00% | |||||||||||||
Withholding tax percentage on dividends | 4.00% | 4.00% | |||||||||||||
Minimum [Member] | Tax Carryforwards And Deductions Expiration Period One [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Expiration period | Dec. 31, 2020 | Dec. 31, 2020 | |||||||||||||
Minimum [Member] | Tax Carryforwards And Deductions Expiration Period Two [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Expiration period | Dec. 31, 2023 | Dec. 31, 2023 | |||||||||||||
Minimum [Member] | Tax Carryforwards And Deductions No Expiration [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Expiration period | Dec. 31, 2030 | Dec. 31, 2030 | |||||||||||||
Maximum [Member] | Tax Carryforwards And Deductions Expiration Period One [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Expiration period | Dec. 31, 2022 | Dec. 31, 2022 | |||||||||||||
Maximum [Member] | Tax Carryforwards And Deductions Expiration Period Two [Member] | |||||||||||||||
Income Tax [Line Items] | |||||||||||||||
Expiration period | Dec. 31, 2029 | Dec. 31, 2029 |
Income Taxes - Schedule of De_3
Income Taxes - Schedule of Deferred Tax Assets and Liabilities By Report Caption (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred Tax Assets Liabilities Net [Line Items] | ||
Long-term assets-deferred income taxes | $ 386 | $ 368 |
Long-term liabilities-deferred income taxes | (1,096) | (2,140) |
Deferred tax assets liabilities net | $ (710) | $ (1,772) |
Income Taxes - Schedule of Unre
Income Taxes - Schedule of Unrecognized Tax Benefits (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Schedule Of Unrecognized Tax Benefits [Line Items] | |||
Balance at the beginning of the year | $ 1,072 | $ 1,034 | $ 734 |
Increase (decrease) related to prior year tax positions, net | 23 | 76 | 56 |
Increase related to current year tax positions | 246 | 11 | 26 |
Decrease related to settlements with tax authorities and lapse of applicable statutes of limitations | (118) | (49) | (56) |
Liabilities assumed in acquisitions | 273 | ||
Other | 1 | ||
Balance at the end of the year | $ 1,223 | $ 1,072 | $ 1,034 |
Equity - Additional Information
Equity - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions | Dec. 31, 2018 | Dec. 17, 2018 | Jul. 13, 2017 | Apr. 18, 2016 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Sep. 03, 2015 | Jun. 29, 2010 |
Class of Stock [Line Items] | |||||||||
Ordinary shares issuance ADSs | 1,200,000,000 | 1,200,000,000 | 1,200,000,000 | ||||||
Share price | $ 9.8 | ||||||||
Share issued due to conversion of convertible preferred shares | 70,600,000 | 70,600,000 | |||||||
Convertible preferred stock terms of conversion | 1 mandatory convertible preferred share to 16 ADSs, and all of the accumulated and unpaid dividends on the mandatory convertible preferred shares were paid in ADSs, at a ratio of 3.0262 | ||||||||
Number of shares exercisable | 26,601,000 | ||||||||
Number of shares available for future awards | 62,700,000 | ||||||||
Vesting period, description | The vesting period of the outstanding options, RSUs and PSUs is generally from 1 to 4 years from the date of grant. The rights of the ordinary shares obtained from the exercise of options, RSUs or PSUs are identical to those of the other ordinary shares of the Company. The contractual term of these options is primarily for seven years in prior plans and ten years for options granted under the 2010 and 2015 plans described above. | ||||||||
Company average share price | $ 20.92 | $ 11.50 | $ 20.92 | $ 25.62 | |||||
Total unrecognized compensation cost before tax on employee stock options | $ 53 | ||||||||
Total unrecognized compensation cost before tax on employee stock RSUs | $ 159 | ||||||||
Share based compensation arrangements expected over weighted average period for options | 1 year 10 months 24 days | ||||||||
Share based compensation arrangements expected over weighted average period for RSU/PSUs | 2 years 8 months 12 days | ||||||||
Dividends declared and paid | $ 0 | 0 | 0.85 | ||||||
Dividend mandatory convertible preferred shares | $ 0 | $ 0 | $ 0 | $ 70,000,000 | |||||
2010 Long-Term Equity-Based Incentive Plan [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Number of shares exercisable | 70,000,000 | ||||||||
2015 Long-Term Equity-Based Incentive Plan [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Number of shares exercisable | 142,000,000 | 77,000,000 | 43,700,000 | ||||||
Number of additional shares authorized | 65,000,000 | 33,300,000 |
Equity - Summary of Stock Optio
Equity - Summary of Stock Option Activity (Detail) - $ / shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Balance outstanding at begining of year | 48,393 | 43,121 | 32,789 |
Granted | 12,401 | 15,467 | |
Exercised | (11) | (84) | (7) |
Forfeited | (8,318) | (7,040) | (4,953) |
Expired | (5) | (175) | |
Balance outstanding at end of year | 40,064 | 48,393 | 43,121 |
Balance exercisable at end of year | 26,601 | 24,086 | 19,129 |
Balance outstanding at begining of year | $ 38.62 | $ 44.32 | $ 50.71 |
Granted | 19.12 | 32.08 | |
Exercised | 16.99 | 17.01 | 17.44 |
Forfeited | 42.12 | 39.38 | 47.92 |
Expired | 50.65 | 59.81 | |
Balance outstanding at end of year | 37.90 | 38.62 | 44.32 |
Balance exercisable at end of year | $ 43.41 | $ 46.89 | $ 47.94 |
Equity - Summary of Weighted Av
Equity - Summary of Weighted Average Fair Value of Options Granted (Detail) - $ / shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted average fair value | $ 7.4 | $ 5.7 |
Equity - Summary of Fair Value
Equity - Summary of Fair Value of Options Estimated on Date of Grant Based on Weighted Average Assumptions (Detail) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Dividend yield | 0.00% | 3.70% |
Expected volatility | 40.00% | 29.00% |
Risk-free interest rate | 2.60% | 2.10% |
Equity - Schedule of Ordinary S
Equity - Schedule of Ordinary Shares Issued Upon Outstanding Options (Detail) $ / shares in Units, shares in Thousands, $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($)yr$ / sharesshares | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Balance at end of period (in thousands) Number of shares | shares | 40,064 |
Weighted average exercise price | $ 37.90 |
Weighted average remaining life Years | yr | 5.89 |
Lower than $15.01 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Balance at end of period (in thousands) Number of shares | shares | 592 |
Weighted average exercise price | $ 11.40 |
Weighted average remaining life Years | yr | 7.85 |
Aggregate intrinsic value (in millions) | $ | $ 0 |
Range of exercise prices, lower limit | $ 15.01 |
Range of exercise prices, upper limit | $ 15.01 |
$15.01 - $25.00 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Balance at end of period (in thousands) Number of shares | shares | 10,938 |
Weighted average exercise price | $ 18.94 |
Weighted average remaining life Years | yr | 8.13 |
Range of exercise prices, lower limit | $ 15.01 |
Range of exercise prices, upper limit | $ 25 |
$25.01 - $35.00 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Balance at end of period (in thousands) Number of shares | shares | 7,914 |
Weighted average exercise price | $ 34.62 |
Weighted average remaining life Years | yr | 7.16 |
Range of exercise prices, lower limit | $ 25.01 |
Range of exercise prices, upper limit | $ 35 |
$35.01 - $45.00 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Balance at end of period (in thousands) Number of shares | shares | 5,511 |
Weighted average exercise price | $ 40.59 |
Weighted average remaining life Years | yr | 2.49 |
Range of exercise prices, lower limit | $ 35.01 |
Range of exercise prices, upper limit | $ 45 |
$45.01 - $55.00 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Balance at end of period (in thousands) Number of shares | shares | 10,328 |
Weighted average exercise price | $ 50.74 |
Weighted average remaining life Years | yr | 4.53 |
Range of exercise prices, lower limit | $ 45.01 |
Range of exercise prices, upper limit | $ 55 |
$55.01 - $65.00 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Balance at end of period (in thousands) Number of shares | shares | 4,781 |
Weighted average exercise price | $ 59.20 |
Weighted average remaining life Years | yr | 5.31 |
Aggregate intrinsic value (in millions) | $ | $ 0 |
Range of exercise prices, lower limit | $ 55.01 |
Range of exercise prices, upper limit | $ 65 |
Equity - Schedule of Ordinary_2
Equity - Schedule of Ordinary Shares Issued Upon Vested Options (Detail) shares in Thousands | 12 Months Ended |
Dec. 31, 2019yr$ / sharesshares | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Balance at end of period (in thousands) Number of shares | shares | 26,601 |
Weighted average exercise price | $ 43.41 |
Weighted average remaining life Years | yr | 5 |
Lower than $15.01 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Balance at end of period (in thousands) Number of shares | shares | 197 |
Weighted average exercise price | $ 11.40 |
Weighted average remaining life Years | yr | 7.85 |
Range of exercise prices, lower limit | $ 15.01 |
Range of exercise prices, upper limit | $ 15.01 |
$15.01 - $25.00 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Balance at end of period (in thousands) Number of shares | shares | 3,211 |
Weighted average exercise price | $ 18.57 |
Weighted average remaining life Years | yr | 8.05 |
Range of exercise prices, lower limit | $ 15.01 |
Range of exercise prices, upper limit | $ 25 |
$25.01 - $35.00 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Balance at end of period (in thousands) Number of shares | shares | 3,983 |
Weighted average exercise price | $ 34.61 |
Weighted average remaining life Years | yr | 7.16 |
Range of exercise prices, lower limit | $ 25.01 |
Range of exercise prices, upper limit | $ 35 |
$35.01 - $45.00 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Balance at end of period (in thousands) Number of shares | shares | 5,511 |
Weighted average exercise price | $ 40.59 |
Weighted average remaining life Years | yr | 2.49 |
Range of exercise prices, lower limit | $ 35.01 |
Range of exercise prices, upper limit | $ 45 |
$45.01 - $55.00 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Balance at end of period (in thousands) Number of shares | shares | 9,165 |
Weighted average exercise price | $ 50.43 |
Weighted average remaining life Years | yr | 4.32 |
Range of exercise prices, lower limit | $ 45.01 |
Range of exercise prices, upper limit | $ 55 |
$55.01 - $65.00 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Balance at end of period (in thousands) Number of shares | shares | 4,534 |
Weighted average exercise price | $ 59.37 |
Weighted average remaining life Years | yr | 5.27 |
Range of exercise prices, lower limit | $ 55.01 |
Range of exercise prices, upper limit | $ 65 |
Equity - Schedule of Number of
Equity - Schedule of Number of RSUs Issued and Outstanding (Detail) - Restricted Stock Units [Member] - $ / shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Balance outstanding at beginning of year | 10,403 | 7,468 | 4,636 |
Granted | 9,303 | 5,900 | 5,461 |
Vested | (2,435) | (1,638) | (1,884) |
Forfeited | (1,294) | (1,327) | (745) |
Balance outstanding at end of year | 15,977 | 10,403 | 7,468 |
Weighted-average grant date fair value per share - RSUs at beginning year | $ 20.93 | $ 27.95 | $ 45.15 |
Granted | 15.36 | 18.80 | 20.10 |
Vested | 30.24 | 37.30 | 39.63 |
Forfeited | 18.74 | 32.50 | 42.84 |
Weighted-average grant date fair value per share - RSUs at end of year | $ 16.49 | $ 20.93 | $ 27.95 |
Equity - Summary of Company Exp
Equity - Summary of Company Expenses Compensation Costs Based on Grant Date Fair Value (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Stock Options Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total stock-based compensation expense | $ 46 | $ 74 | $ 64 |
Restricted Stock Units [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total stock-based compensation expense | 73 | 81 | 69 |
Omnibus Long Term Share Incentive Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total stock-based compensation expense | 119 | 155 | 133 |
Tax effect on stock-based compensation expense | 14 | 18 | 24 |
Net effect | $ 105 | $ 137 | $ 109 |
Equity - Accumulated Other Comp
Equity - Accumulated Other Comprehensive Income/(Loss) (Net of Tax) (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning Balance | $ (2,459) | |||
Ending Balance | (2,312) | $ (2,459) | ||
Foreign Currency Translation Adjustments [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning Balance | (1,878) | (1,139) | $ (2,592) | |
Other comprehensive income/(loss) before reclassifications | 84 | (739) | 1,075 | |
Amounts reclassified to the statements of income | 378 | |||
Net other comprehensive loss before tax | 84 | (739) | 1,453 | |
Net other comprehensive loss after tax | 84 | (739) | 1,453 | |
Ending Balance | (1,794) | (1,878) | (1,139) | |
Available-for-sale Securities [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning Balance | 1 | (4) | (7) | |
Cumulative effect of new accounting standard (See Note 1) | 5 | |||
Other comprehensive income/(loss) before reclassifications | (1) | (1) | 64 | |
Amounts reclassified to the statements of income | 1 | (66) | ||
Net other comprehensive loss before tax | (1) | (2) | ||
Corresponding income tax | 5 | |||
Net other comprehensive loss after tax | (1) | 3 | ||
Ending Balance | 1 | (4) | ||
Derivative Financial Instruments [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning Balance | (504) | (619) | (479) | |
Other comprehensive income/(loss) before reclassifications | 54 | 87 | (167) | |
Amounts reclassified to the statements of income | 30 | 28 | 27 | |
Net other comprehensive loss before tax | 84 | 115 | (140) | |
Net other comprehensive loss after tax | 84 | 115 | (140) | |
Ending Balance | (420) | (504) | (619) | |
Benefit Plans [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning Balance | (78) | (91) | (81) | |
Other comprehensive income/(loss) before reclassifications | (11) | 4 | (3) | |
Amounts reclassified to the statements of income | (10) | 13 | (5) | |
Net other comprehensive loss before tax | (21) | 17 | (8) | |
Corresponding income tax | 1 | (4) | (2) | |
Net other comprehensive loss after tax | (20) | 13 | (10) | |
Ending Balance | (98) | (78) | (91) | |
AOCI Attributable to Parent [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning Balance | (2,459) | (1,853) | (3,159) | |
Cumulative effect of new accounting standard (See Note 1) | [1] | 5 | ||
Other comprehensive income/(loss) before reclassifications | 126 | (649) | 969 | |
Amounts reclassified to the statements of income | 20 | 42 | 334 | |
Net other comprehensive loss before tax | 146 | (607) | 1,303 | |
Corresponding income tax | 1 | (4) | 3 | |
Net other comprehensive loss after tax | 147 | (611) | 1,306 | |
Ending Balance | $ (2,312) | $ (2,459) | $ (1,853) | |
[1] | Following the adoption of ASU 2016-01, the Company recorded a $ 5 million opening balance reclassification from accumulated other comprehensive income to retained earnings. |
Equity - Accumulated Other Co_2
Equity - Accumulated Other Comprehensive Income/(Loss) (Net of Tax) (Parenthetical) (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Accounting Standards Update 2016-01 [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Foreign currency translation attributable to non-controlling interests | $ 5 | ||
Foreign Currency Translation Adjustments Attributable to Non-controlling Interests [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Foreign currency translation attributable to non-controlling interests | $ 14 | $ 26 | $ (63) |
Other assets impairments, res_3
Other assets impairments, restructuring and other items - Schedule of Other Assets Impairments, Restructuring and Other Items (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Restructuring and Impairment Costs [Line Items] | |||
Impairments of long-lived tangible assets | $ 139 | $ 500 | $ 544 |
Contingent consideration (see note 20) | 59 | 57 | 154 |
Acquisition, Integration and related costs | 13 | 105 | |
Restructuring | 199 | 488 | 535 |
Venezuela deconsolidation charge | 396 | ||
Other | 26 | (71) | 102 |
Total | $ 423 | $ 987 | $ 1,836 |
Other assets impairments, res_4
Other assets impairments, restructuring and other items - Additional Information (Detail) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019USD ($)Positions | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Restructuring and Impairment Costs [Line Items] | |||
Impairments of property, plant and equipment | $ 139 | $ 500 | $ 544 |
Business combination contingent consideration arrangements change in amount of contingent consideration liability | 59 | 57 | 154 |
Restructuring costs | $ 199 | $ 488 | $ 535 |
Number of positions eliminated | Positions | 13,000 | ||
Recall and inventory reserves cost | $ 54 | ||
Expected revenue from Florida manufacturing plant in 2020 | $ 230 |
Other assets impairments, res_5
Other assets impairments, restructuring and other items - Components of costs associated with restructuring plan including costs related to exit and disposal activities (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | $ 199 | $ 488 | $ 535 |
Employee termination [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | 159 | 410 | 443 |
Other [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | $ 40 | $ 78 | $ 92 |
Other assets impairments, res_6
Other assets impairments, restructuring and other items - Summary of Restructuring Accruals (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Restructuring Cost and Reserve [Line Items] | ||
Beginning balance | $ (233) | $ (311) |
Provision | (199) | (488) |
Utilization and other | 217 | 566 |
Ending balance | (215) | (233) |
Employee termination costs [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Beginning balance | (204) | (294) |
Provision | (159) | (410) |
Utilization and other | 155 | 500 |
Ending balance | (208) | (204) |
Other Exit and Disposal [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Beginning balance | (29) | (17) |
Provision | (40) | (78) |
Utilization and other | 62 | 66 |
Ending balance | $ (7) | $ (29) |
Other Income - Schedule of Othe
Other Income - Schedule of Other Income (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Other Income [Line Items] | ||||
Gain on divestitures, net of divestitures related costs | [1] | $ 50 | $ 67 | $ 1,083 |
Section 8 and similar payments | [2] | 5 | 195 | 83 |
Gain (loss) on sale of assets | (1) | 9 | 11 | |
Other, net | 22 | 20 | 22 | |
Total other income | $ 76 | $ 291 | $ 1,199 | |
[1] | Mainly related to the divestment of several activities in the International Markets segment. | |||
[2] | Section 8 of the Patented Medicines (Notice of Compliance) Regulation relates to recoveries of lost revenue related to patent infringement proceedings in Canada. |
Financial expenses-net - Schedu
Financial expenses-net - Schedule of Financial Expenses (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Expenses [Line Items] | ||||
Venezuela devaluation | [1] | $ 0 | $ 0 | $ 42 |
Interest expenses and other bank charges | 881 | 920 | 875 | |
Income from investments | (41) | (39) | (84) | |
Foreign exchange (gains) losses—net | (15) | 13 | 65 | |
Other, net | [2] | (4) | 65 | (3) |
Total finance expense—net | $ 822 | $ 959 | $ 895 | |
[1] | For further information regarding the Venezuela devaluation, refer to note 1a. | |||
[2] | In 2018 Other, net comprised mainly of a make-whole payment of $46 million following early redemption of senior notes during 2018. |
Financial Expenses-Net - Sche_2
Financial Expenses-Net - Schedule of Financial Expenses (Parenthetical) (Detail) $ in Millions | Dec. 31, 2018USD ($) |
Expenses [Line Items] | |
Payment for redemption of senior notes | $ 46 |
Earnings (Loss) per Share - Sch
Earnings (Loss) per Share - Schedule of Earnings per Share (Detail) - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||
Net income (loss) used for the computation of diluted loss per share | $ (999) | $ (2,399) | $ (16,525) |
Weighted average number of shares used in the computation of basic loss per share | 1,091 | 1,021 | 1,016 |
Weighted average number of shares used in the computation of diluted loss per share | 1,091 | 1,021 | 1,016 |
Earnings (Loss) per Share - Add
Earnings (Loss) per Share - Additional Information (Detail) - shares shares in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 17, 2018 | Dec. 31, 2017 | |
Stock Option Restricted Stock Units And Performance Stock Units [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Weighted average shares with anti-dilutive effect on earnings per share | 113 | 51 | 38 | |
Convertible Preferred Stock [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Weighted average shares with anti-dilutive effect on earnings per share | 74 | 59 |
Segments - Summary of Segment P
Segments - Summary of Segment Profit (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||||||||||
Revenues | $ 4,468 | $ 4,093 | $ 4,177 | $ 4,149 | $ 4,419 | $ 4,385 | $ 4,552 | $ 4,916 | $ 16,887 | $ 18,271 | $ 21,853 | |
Gross profit | $ 1,958 | $ 1,830 | $ 1,893 | $ 1,856 | $ 1,971 | $ 1,977 | $ 2,033 | $ 2,315 | 7,537 | 8,296 | 10,615 | |
R&D expenses | 1,010 | 1,213 | 1,778 | |||||||||
S&M expenses | 2,614 | 2,916 | 3,395 | |||||||||
G&A expenses | 1,192 | 1,298 | 1,451 | |||||||||
Segment profit | (443) | (1,637) | (17,484) | |||||||||
North America [Member] | ||||||||||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||||||||||
Revenues | 8,542 | 9,297 | 12,141 | |||||||||
Gross profit | 4,350 | 4,979 | 7,322 | |||||||||
R&D expenses | 652 | 713 | 969 | |||||||||
S&M expenses | 1,021 | 1,154 | 1,288 | |||||||||
G&A expenses | 439 | 484 | 533 | |||||||||
Other (income) expense | (14) | (209) | (92) | |||||||||
Segment profit | 2,252 | 2,837 | 4,624 | |||||||||
Europe [Member] | ||||||||||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||||||||||
Revenues | 4,795 | 5,186 | 5,466 | |||||||||
Gross profit | 2,704 | 2,884 | 2,887 | |||||||||
R&D expenses | 262 | 283 | 390 | |||||||||
S&M expenses | 890 | 1,003 | 1,130 | |||||||||
G&A expenses | 239 | 325 | 354 | |||||||||
Other (income) expense | (5) | (16) | ||||||||||
Segment profit | 1,318 | 1,273 | 1,029 | |||||||||
International Markets [Member] | ||||||||||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||||||||||
Revenues | [1] | 2,246 | 2,422 | 2,863 | ||||||||
Gross profit | [1] | 1,167 | 1,254 | 1,433 | ||||||||
R&D expenses | [1] | 88 | 96 | 154 | ||||||||
S&M expenses | [1] | 481 | 518 | 672 | ||||||||
G&A expenses | [1] | 138 | 153 | 189 | ||||||||
Other (income) expense | [1] | (3) | (11) | (8) | ||||||||
Segment profit | [1] | $ 464 | $ 498 | $ 426 | ||||||||
[1] | The data presented for prior periods have been revised to reflect a revision in the presentation of net revenues and cost of sales in the consolidated financial statements. See note 1b. |
Segments - Summary of Profit by
Segments - Summary of Profit by Segments and Reconciliation of Segments Profit to Consolidated Income Before Income Taxes (Detail) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |||
Amounts allocated to segments: | |||||
Segments profit | $ (443) | $ (1,637) | $ (17,484) | ||
Amounts not allocated to segments: | |||||
Amortization | 1,113 | 1,166 | 1,444 | ||
Other assets impairments, restructuring and other items | 423 | 987 | 1,836 | ||
Goodwill impairment | 3,027 | [1] | 17,100 | ||
Intangible asset impairments | 1,639 | 1,991 | 3,238 | ||
Gain on divestitures, net of divestitures related costs | (50) | (66) | (1,083) | ||
Inventory step-up | 67 | ||||
Other R&D expenses (income) | (15) | 83 | 221 | ||
Costs related to regulatory actions taken in facilities | 45 | 14 | 47 | ||
Legal settlements and loss contingencies | 1,178 | (1,208) | 500 | ||
Other unallocated amounts | 252 | 366 | 187 | ||
Consolidated operating income (loss) | (443) | (1,637) | (17,484) | ||
Financial expenses, net | 822 | 959 | 895 | ||
Consolidated income (loss) before income taxes | (1,265) | (2,596) | (18,379) | ||
North America [Member] | |||||
Amounts allocated to segments: | |||||
Segments profit | 2,252 | 2,837 | 4,624 | ||
Amounts not allocated to segments: | |||||
Consolidated operating income (loss) | 2,252 | 2,837 | 4,624 | ||
Europe [Member] | |||||
Amounts allocated to segments: | |||||
Segments profit | 1,318 | 1,273 | 1,029 | ||
Amounts not allocated to segments: | |||||
Consolidated operating income (loss) | 1,318 | 1,273 | 1,029 | ||
International Markets [Member] | |||||
Amounts allocated to segments: | |||||
Segments profit | [2] | 464 | 498 | 426 | |
Amounts not allocated to segments: | |||||
Consolidated operating income (loss) | [2] | 464 | 498 | 426 | |
Corporate Segment [Member] | |||||
Amounts allocated to segments: | |||||
Segments profit | 4,034 | 4,608 | 6,079 | ||
Amounts not allocated to segments: | |||||
Consolidated operating income (loss) | 4,034 | 4,608 | 6,079 | ||
Other Segments [Member] | |||||
Amounts allocated to segments: | |||||
Segments profit | 108 | 115 | (6) | ||
Amounts not allocated to segments: | |||||
Consolidated operating income (loss) | 108 | 115 | (6) | ||
Segments and Other Activities [Member] | |||||
Amounts allocated to segments: | |||||
Segments profit | 4,142 | 4,723 | 6,073 | ||
Amounts not allocated to segments: | |||||
Consolidated operating income (loss) | $ 4,142 | $ 4,723 | $ 6,073 | ||
[1] | Goodwill impairment mainly attributable to the International Markets segment, Mexico and Medis. | ||||
[2] | The data presented for prior periods have been revised to reflect a revision in the presentation of net revenues and cost of sales in the consolidated financial statements. See note 1b. |
Segments - Schedule of Revenues
Segments - Schedule of Revenues by Major Products and Activities (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Product Information [Line Items] | ||||||||||||
Revenues | $ 4,468 | $ 4,093 | $ 4,177 | $ 4,149 | $ 4,419 | $ 4,385 | $ 4,552 | $ 4,916 | $ 16,887 | $ 18,271 | $ 21,853 | |
North America [Member] | ||||||||||||
Product Information [Line Items] | ||||||||||||
Revenues | 8,542 | 9,297 | 12,141 | |||||||||
Europe [Member] | ||||||||||||
Product Information [Line Items] | ||||||||||||
Revenues | 4,795 | 5,186 | 5,466 | |||||||||
International Markets [Member] | ||||||||||||
Product Information [Line Items] | ||||||||||||
Revenues | [1] | 2,246 | 2,422 | 2,863 | ||||||||
Generic products [Member] | North America [Member] | ||||||||||||
Product Information [Line Items] | ||||||||||||
Revenues | 3,963 | 4,056 | 5,203 | |||||||||
Generic products [Member] | Europe [Member] | ||||||||||||
Product Information [Line Items] | ||||||||||||
Revenues | 3,470 | 3,593 | 3,471 | |||||||||
Generic products [Member] | International Markets [Member] | ||||||||||||
Product Information [Line Items] | ||||||||||||
Revenues | 1,893 | 2,022 | 2,370 | |||||||||
COPAXONE [Member] | North America [Member] | ||||||||||||
Product Information [Line Items] | ||||||||||||
Revenues | 1,017 | 1,759 | 3,116 | |||||||||
COPAXONE [Member] | Europe [Member] | ||||||||||||
Product Information [Line Items] | ||||||||||||
Revenues | 432 | 535 | 595 | |||||||||
COPAXONE [Member] | International Markets [Member] | ||||||||||||
Product Information [Line Items] | ||||||||||||
Revenues | 63 | 72 | 91 | |||||||||
BENDEKA and TREANDA [Member] | North America [Member] | ||||||||||||
Product Information [Line Items] | ||||||||||||
Revenues | 496 | 642 | 656 | |||||||||
ProAir [Member] | North America [Member] | ||||||||||||
Product Information [Line Items] | ||||||||||||
Revenues | 274 | 397 | 501 | |||||||||
QVAR [Member] | North America [Member] | ||||||||||||
Product Information [Line Items] | ||||||||||||
Revenues | 250 | 182 | 313 | |||||||||
AJOVY [Member] | North America [Member] | ||||||||||||
Product Information [Line Items] | ||||||||||||
Revenues | 93 | 3 | ||||||||||
AUSTEDO [Member] | North America [Member] | ||||||||||||
Product Information [Line Items] | ||||||||||||
Revenues | 412 | 204 | 24 | |||||||||
Distribution [Member] | International Markets [Member] | ||||||||||||
Product Information [Line Items] | ||||||||||||
Revenues | 20 | 19 | 17 | |||||||||
Respiratory Product [Member] | Europe [Member] | ||||||||||||
Product Information [Line Items] | ||||||||||||
Revenues | 354 | 402 | 368 | |||||||||
Anda [Member] | North America [Member] | ||||||||||||
Product Information [Line Items] | ||||||||||||
Revenues | 1,492 | 1,347 | 1,153 | |||||||||
Other [Member] | North America [Member] | ||||||||||||
Product Information [Line Items] | ||||||||||||
Revenues | 546 | 708 | 1,175 | |||||||||
Other [Member] | Europe [Member] | ||||||||||||
Product Information [Line Items] | ||||||||||||
Revenues | 539 | 656 | 1,033 | |||||||||
Other [Member] | International Markets [Member] | ||||||||||||
Product Information [Line Items] | ||||||||||||
Revenues | $ 271 | $ 309 | $ 385 | |||||||||
[1] | The data presented for prior periods have been revised to reflect a revision in the presentation of net revenues and cost of sales in the consolidated financial statements. See note 1b. |
Segments - Schedule of Sales Pe
Segments - Schedule of Sales Percentage by Therapeutic Category (Detail) | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
McKesson Corporation [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Third party net sales present | 13.00% | 12.00% | 16.00% |
AmerisourceBergen Corporation [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Third party net sales present | 12.00% | 14.00% | 15.00% |
Segments - Schedule of Net Sale
Segments - Schedule of Net Sales by Product Line - Schedule of Property, Plant and Equipment by Geographic Location (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property, plant and equipment, net | $ 6,436 | $ 6,868 |
Israel [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property, plant and equipment, net | 1,670 | 1,987 |
United States [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property, plant and equipment, net | 864 | 950 |
Croatia [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property, plant and equipment, net | 517 | 538 |
Germany [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property, plant and equipment, net | 665 | 518 |
Czech republic [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property, plant and equipment, net | 343 | 352 |
Hungary [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property, plant and equipment, net | 330 | 343 |
Japan [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property, plant and equipment, net | 177 | 188 |
Other [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property, plant and equipment, net | $ 1,870 | $ 1,992 |
Segments - Additional Informati
Segments - Additional Information (Detail) - Number | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Segment Reporting Information [Line Items] | |||
Number of reportable segments | 3 | ||
Israel [Member] | Sales Revenue, Net [Member] | Customer Concentration Risk [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues from external customers | 5.00% | 5.00% | 5.00% |
Fair Value Measurement - Summar
Fair Value Measurement - Summary of Financial Items Carried at Fair Value (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Contingent consideration | [1] | $ (460) | $ (507) |
Total | 1,540 | 1,338 | |
Asset Derivatives - Options and Forward Contracts [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivatives | 32 | 18 | |
Liabilities Derivatives - Interest Rate and Cross Currency Swaps [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivatives | (22) | (50) | |
Liabilities Derivatives Options and Forward Contracts [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivatives | (41) | (26) | |
Money Markets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash and cash equivalents | 577 | 203 | |
Cash, Deposits and Other [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash and cash equivalents | 1,398 | 1,579 | |
Equity Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment in securities | 42 | 51 | |
Other, Mainly Debt Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment in securities | 14 | 12 | |
Asset Derivatives - Cross Currency Swaps [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivatives | 58 | ||
Level 1 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total | 2,019 | 1,835 | |
Level 1 [Member] | Money Markets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash and cash equivalents | 577 | 203 | |
Level 1 [Member] | Cash, Deposits and Other [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash and cash equivalents | 1,398 | 1,579 | |
Level 1 [Member] | Equity Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment in securities | 42 | 51 | |
Level 1 [Member] | Other, Mainly Debt Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment in securities | 2 | 2 | |
Level 2 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total | (31) | ||
Level 2 [Member] | Asset Derivatives - Options and Forward Contracts [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivatives | 32 | 18 | |
Level 2 [Member] | Liabilities Derivatives - Interest Rate and Cross Currency Swaps [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivatives | (22) | (50) | |
Level 2 [Member] | Liabilities Derivatives Options and Forward Contracts [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivatives | (41) | (26) | |
Level 2 [Member] | Asset Derivatives - Cross Currency Swaps [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Derivatives | 58 | ||
Level 3 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Contingent consideration | [1] | (460) | (507) |
Total | (448) | (497) | |
Level 3 [Member] | Other, Mainly Debt Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment in securities | $ 12 | $ 10 | |
[1] | Contingent consideration represents liabilities recorded at fair value in connection with acquisitions. |
Fair Value Measurement - Summ_2
Fair Value Measurement - Summary of Fair Value of Financial Liabilities Measured Using Level 3 Inputs (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value at the beginning of the period | $ (497) | $ (717) |
Investment in debt securities | 2 | (8) |
Fair value at the end of the period | (448) | (497) |
Actavis Generics [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Actavis Generics transaction | 92 | |
Labrys acquisition [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Adjustments to provisions for contingent consideration | (17) | |
Settlement of contingent consideration | 151 | |
Eagle Transaction [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Adjustments to provisions for contingent consideration | (151) | (40) |
Settlement of contingent consideration | $ 106 | $ 134 |
Fair Value Measurement - Summ_3
Fair Value Measurement - Summary of Financial Instrument Measured on a Basis Other Than Fair Value (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total | $ 25,004 | $ 25,700 |
Senior Notes [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total | 22,686 | 23,560 |
Senior Notes and Convertible Senior Debentures Included Under Short-Term Liabilities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total | $ 2,318 | $ 2,140 |
Long-term Employee-related Ob_3
Long-term Employee-related Obligations - Schedule of Long Term Employee Related Obligation (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Defined Benefit Plan Disclosure [Line Items] | ||
Accrued severance obligations | $ 76 | $ 75 |
Defined benefit plans | 165 | 146 |
Total | $ 241 | $ 221 |
Long-term Employee-related Ob_4
Long-term Employee-related Obligations - Additional Information (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Defined Benefit Plan Disclosure [Line Items] | ||
Long-term investments earmarked for severance pay liabilities in Israel | $ 82 | $ 137 |
Expected contributions to pension funds | 116 | |
2020 | 7 | |
2021 | 7 | |
2022 | 7 | |
2023 | 7 | |
2024 | 7 | |
2025 to 2029 | $ 41 |
Selected Quarterly Financial _3
Selected Quarterly Financial Data (Unaudited) - Selected Quarterly Financial Data (Detail) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Selected Quarterly Financial Information [Line Items] | |||||||||||
Net revenues | $ 4,468 | $ 4,093 | $ 4,177 | $ 4,149 | $ 4,419 | $ 4,385 | $ 4,552 | $ 4,916 | $ 16,887 | $ 18,271 | $ 21,853 |
Gross profit | 1,958 | 1,830 | 1,893 | 1,856 | 1,971 | 1,977 | 2,033 | 2,315 | 7,537 | 8,296 | 10,615 |
Net income (loss) | 75 | (307) | (671) | (97) | (3,243) | (197) | (166) | 1,134 | (1,000) | (2,472) | (16,449) |
Net income (loss) attributable to Teva | 110 | (314) | (689) | (105) | (2,886) | (208) | (176) | 1,120 | (999) | (2,150) | (16,265) |
Net income (loss) attributable to ordinary shareholders | $ 110 | $ (314) | $ (689) | $ (105) | $ (2,940) | $ (273) | $ (241) | $ 1,055 | $ (999) | $ (2,399) | $ (16,525) |
Earnings per share attributable to ordinary shareholders: | |||||||||||
Basic | $ 0.10 | $ (0.29) | $ (0.63) | $ (0.10) | $ (2.85) | $ (0.27) | $ (0.24) | $ 1.04 | $ (0.91) | $ (2.35) | $ (16.26) |
Diluted | $ 0.10 | $ (0.29) | $ (0.63) | $ (0.10) | $ (2.85) | $ (0.27) | $ (0.24) | $ 1.03 | $ (0.91) | $ (2.35) | $ (16.26) |
Selected Quarterly Financial _4
Selected Quarterly Financial Data (Unaudited) - Summary of the impact of the revision on net revenues and cost of sales (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Selected Quarterly Financial Information [Line Items] | |||||||||||
Net revenues | $ 4,468 | $ 4,093 | $ 4,177 | $ 4,149 | $ 4,419 | $ 4,385 | $ 4,552 | $ 4,916 | $ 16,887 | $ 18,271 | $ 21,853 |
Cost of sales | $ 9,351 | $ 9,975 | $ 11,237 | ||||||||
As reported [Member] | |||||||||||
Selected Quarterly Financial Information [Line Items] | |||||||||||
Net revenues | 4,264 | 4,337 | 4,295 | 4,559 | 4,529 | 4,701 | 5,065 | ||||
Cost of sales | 2,435 | 2,443 | 2,440 | 2,588 | 2,552 | 2,668 | 2,750 | ||||
Adjustment [Member] | |||||||||||
Selected Quarterly Financial Information [Line Items] | |||||||||||
Net revenues | (171) | (159) | (146) | (141) | (143) | (150) | (149) | ||||
Cost of sales | (171) | (159) | (146) | (141) | (143) | (150) | (149) | ||||
As revised [Member] | |||||||||||
Selected Quarterly Financial Information [Line Items] | |||||||||||
Net revenues | 4,093 | 4,177 | 4,149 | 4,419 | 4,385 | 4,552 | 4,916 | ||||
Cost of sales | $ 2,264 | $ 2,284 | $ 2,293 | $ 2,447 | $ 2,409 | $ 2,518 | $ 2,601 |
Subsequent event - Additional i
Subsequent event - Additional information (Detail) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Subsequent Event [Member] | |
Intangible Asset Impairment | $ 211 |
Schedule II Valuation and Quali
Schedule II Valuation and Qualifying Accounts (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance at beginning of period | $ 6,886 | $ 8,077 | |
Deductions | (17,605) | (20,480) | |
Balance at end of period | 6,246 | 6,886 | $ 8,077 |
Allowance For Doubtful Accounts [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance at beginning of period | 232 | 232 | 191 |
Charged to costs and expenses | (16) | 13 | 12 |
Charged to other accounts | (9) | 51 | |
Deductions | (7) | (4) | (22) |
Balance at end of period | 209 | 232 | 232 |
Valuation Allowance in Tax Carryforward Losses And Deductions [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance at beginning of period | 1,633 | 1,504 | 1,690 |
Charged to costs and expenses | 555 | 407 | 173 |
Charged to other accounts | 5 | 390 | |
Deductions | (214) | (283) | (749) |
Balance at end of period | $ 1,974 | $ 1,633 | $ 1,504 |