Israel-based Teva Pharmaceutical Industries reported a smaller-than-expected rise in second-quarter profit on Wednesday but reaffirmed earnings guidance for the year despite saying that the COVID-19 pandemic could hurt sales.
The world's largest generic drugmaker was optimistic it could reach a settlement this year in the United States regarding lawsuits over its role in the nationwide opioid epidemic, said CEO Kare Schultz.
"We don't have a lot of money so... there's no way we can offer a lot of money but what we can offer...is to manufacture generics" to help wean people off of addictive painkillers, Schultz told Reuters in an interview.
Teva said it expects revenue of $16-$16.4 billion for the year, $0.4 billion below its previous estimate, but kept its earnings per share forecast of $2.50-$2.70.
"Due to the effects of the pandemic, we have lowered our 2021 revenue outlook, while reaffirming our earnings and cash flow guidance," Schultz said.
The company, he said, had been cautious on overall spending this year due to the uncertainty surrounding the coronavirus crisis, so it was able to protect the bottom line.
Teva earned 59 cents per diluted share excluding one-time items in the April-June period, up from 55 cents a year ago.
Quarterly revenue was $3.91 billion, an increase of 1% or a decrease of 2% in local currency terms from the previous year, the company said, citing lower sales in North America. Teva saw growth in its two main branded drugs, Huntington's disease treatment Austedo and migraine product Ajovy.
Analysts had forecast earnings of 63 cents a share ex-items on revenue of $4.06 billion, according to I/B/E/S data from Refinitiv.
Teva, along with other drugmakers, has been accused of misleadingly marketing their pain medicines as safe, fueling the overuse of opioids in the United States.
Asked about a possible settlement on the opioid cases, Schultz told analysts the company has been in an ongoing dialogue with the Attorney General and the plaintiff lawyers.
"We are optimistic that we can reach a settlement during the coming year," he said. "We think a settlement will be to the benefit of all the Americans that suffer from substance abuse."
Teva has had extensive talks with manufacturers of COVID-19 vaccines to see if it can assist in filling, packing and distributing shots but has no indications of an imminent agreement, Schultz told Reuters.
"We have basically been in contact with all the big manufacturers of the current vaccines...and none of this has come to fruition," he said.
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