The world’s biggest generic medicine maker, Teva Pharmaceutical Industries (NYSE: TEVA) announced that their 2017 profit forecasts wouldn’t be met due to U.S. market competition as well as weakening sales of their multiple sclerosis drug, Copaxone which slashed shares. The company has been dealing with $35 billion in debt with narrowing profit margins that might lead to credit rating downgrade.
Teva is looking to stabilize operating profit and cash flow in order to improve their financial profile by hoping to boost growth and cut debt that was mostly built up to finance their $40.5 billion purchase of a generics business called Actavis.
Shares of the company dropped another 20% on Nasdaq on Thursday which followed poor second quarter results just three months ago. Teva’s sales of Copaxone has declined with prices falling around 10% in the third quarter, forcing the medicine maker to reduce 2017 estimates. The year’s earnings per share forecast were cut from $4.30-$4.50 to $3.77-$3.87 and revenue forecast from $22.8-$23.2 billion to $22.2-$22.3 billion. Third quarter adjusted revenue was $1, which was down $1.31 a year earlier. Copaxone sales dropped 7% to $987 million. The company predicts about $400 million of revenues from new product launches this year, compared to a previous estimate of $500 million.