Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2015shares | |
Document And Entity Information [Abstract] | |
Document Type | 20-F |
Document Period End Date | Dec. 31, 2015 |
Amendment Flag | true |
Amendment Description | N.A. |
Current Fiscal Year End Date | --12-31 |
Entity Central Index Key | 818,686 |
Entity Current Reporting Status | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Registrant Name | TEVA PHARMACEUTICAL INDUSTRIES LTD |
Trading Symbol | TEVA |
Entity Voluntary Filers | Yes |
Entity Well Known Seasoned Issuer | Yes |
Document Fiscal Year Focus | 2,015 |
Document Fiscal Period Focus | Q4 |
Entity Common Stock Shares Outstanding | 1,016,038,648 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
CONSOLIDATED STATEMENTS OF INCOME | |||
Net revenues | $ 19,652 | $ 20,272 | $ 20,314 |
Cost of sales | 8,296 | 9,216 | 9,607 |
Gross profit | 11,356 | 11,056 | 10,707 |
Research and development expenses | 1,525 | 1,488 | 1,427 |
Selling and marketing expenses | 3,478 | 3,861 | 4,080 |
General and administrative expenses | 1,239 | 1,217 | 1,239 |
Impairments restructuring and others | 1,131 | 650 | 788 |
Legal Settlements And Loss Contingencies | 631 | (111) | 1,524 |
Operating income | 3,352 | 3,951 | 1,649 |
Financial expenses - net | 1,000 | 313 | 399 |
Income before income taxes | 2,352 | 3,638 | 1,250 |
Income taxes | 634 | 591 | (43) |
Share in losses of associated companies - net | 121 | 5 | 40 |
Net income | 1,597 | 3,042 | 1,253 |
Net income (loss) attributable to non-controlling interests | 9 | (13) | (16) |
Net income attributable to Teva | 1,588 | 3,055 | 1,269 |
Accrued dividends on preferred shares. | 15 | ||
Net income attributable to ordinary shareholders | $ 1,573 | $ 3,055 | $ 1,269 |
Weighted average number of shares (in millions): | |||
Basic | 855 | 853 | 849 |
Diluted | 864 | 858 | 850 |
Earnings per share attributable to ordinary shareholders: | |||
Basic | $ 1.84 | $ 3.58 | $ 1.49 |
Diluted | $ 1.82 | $ 3.56 | $ 1.49 |
COMPREHENSIVE INCOME
COMPREHENSIVE INCOME - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Comprehensive Income [Abstract] | |||
Net income | $ 1,597 | $ 3,042 | $ 1,253 |
Other Comprehensive Income (Loss) Net Of Tax [Abstract] | |||
Currency translation adjustment | (1,102) | (1,440) | (22) |
Unrealized gain (loss) on derivative financial instruments, net | 135 | 237 | (104) |
Unrealized gain (loss) from available-for-sale securities, net | 319 | (12) | 12 |
Unrealized gain (loss) on defined benefit plans, net | 35 | (43) | 42 |
Total Other Comprehensive loss | (613) | (1,258) | (72) |
Total comprehensive Income | 984 | 1,784 | 1,181 |
Comprehensive income (loss) attributable to the non-controlling interests | 8 | (19) | (14) |
Comprehensive income attributable to Teva | $ 976 | $ 1,803 | $ 1,195 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 6,946 | $ 2,226 |
Accounts receivable | 5,350 | 5,408 |
Inventories | 3,966 | 4,371 |
Deferred income taxes. | 735 | 993 |
Other Current Assets | 1,401 | 1,398 |
Total current assets | 18,398 | 14,396 |
Other non-current assets | 2,616 | 1,569 |
Property, plant and equipment, net | 6,544 | 6,535 |
Identifiable intangible assets, net | 7,675 | 5,512 |
Goodwill | 19,025 | 18,408 |
Total assets | 54,258 | 46,420 |
Current liabilities: | ||
Short-term debt | 1,585 | 1,761 |
Sales Reserves And Allowances | 6,601 | 5,849 |
Accounts payable and accruals | 3,594 | 3,171 |
Other current liabilities | 1,225 | 1,508 |
Total current liabilities | 13,005 | 12,289 |
Long-term liabilities: | ||
Deferred income taxes | 1,748 | 1,101 |
Other taxes and long term liabilities | 1,195 | 1,109 |
Senior notes and loans | 8,383 | 8,566 |
Total long term liabilities | 11,326 | 10,776 |
Total liabilities | 24,331 | 23,065 |
Teva shareholders' equity: | ||
Preferred Shares | 3,291 | 0 |
Ordinary shares | 52 | 50 |
Additional paid-in capital | 17,757 | 14,121 |
Retained earnings | 14,851 | 14,436 |
Accumulated other comprehensive loss | (1,955) | (1,343) |
Treasury shares | (4,227) | (3,951) |
Stockholders' equity attributable to Teva shareholders | 29,769 | 23,313 |
Non-controlling interests | 158 | 42 |
Total equity | 29,927 | 23,355 |
Total liabilities and equity | $ 54,258 | $ 46,420 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - ₪ / shares shares in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
CONSOLIDATED BALANCE SHEETS | ||
Ordinary shares, authorized | 2,500 | 2,500 |
Ordinary shares, issued | 1,016 | 957 |
Treasury, shares | 108 | 105 |
Common Stock, Par or Stated Value Per Share | ₪ 0.10 | |
Preferred Stock Shares Issued | 3.4 | |
Preferred Stock Shares Authorized | 5 | |
Preferred Stock Par Or Stated Value Per Share | ₪ 0.10 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) shares in Millions, $ in Millions | Total | Ordinary Shares: Stated value or Number of shares | Additional Paid In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Treasury Shares | Total Tevas share holders equity | Noncontrolling Interest | MCPS |
Shares, balance at Period Start at Dec. 31, 2012 | 944 | ||||||||
Comprehensive Income (loss) | $ 1,181 | $ 1,269 | $ (74) | $ 1,195 | $ (14) | ||||
Exercise of options by employees and vested RSUs | 91 | $ 0 | $ 73 | $ (18) | 91 | ||||
Exercise of options by employees and vested RSUs, shares | 3 | ||||||||
Stock-based compensation expense | 64 | 64 | 64 | ||||||
Dividends to ordinary shareholders | (1,080) | (1,080) | (1,080) | ||||||
Purchase of treasury shares | 497 | 497 | 497 | ||||||
Disposition of non-controlling interests | (12) | (12) | |||||||
Balance as of at Dec. 31, 2012 | 22,867 | $ 50 | 13,474 | 12,346 | (17) | 3,085 | 22,768 | 99 | |
Shares, balance at Preiod End at Dec. 31, 2013 | 947 | ||||||||
Balance at Period End at Dec. 31, 2013 | 22,636 | $ 50 | 13,628 | 12,535 | (91) | 3,557 | 22,565 | 71 | |
Other | 22 | 0 | 17 | 7 | 24 | (2) | |||
Comprehensive Income (loss) | 1,784 | 3,055 | (1,252) | 1,803 | (19) | ||||
Exercise of options by employees and vested RSUs | 514 | $ 0 | 408 | (106) | 514 | ||||
Exercise of options by employees and vested RSUs, shares | 10 | ||||||||
Stock-based compensation expense | 95 | 95 | 95 | ||||||
Dividends to ordinary shareholders | (1,156) | (1,156) | (1,156) | ||||||
Purchase of treasury shares | 500 | 500 | 500 | ||||||
Stock Holders Equity Other Shares | 0 | ||||||||
Disposition of non-controlling interests | (14) | (14) | |||||||
Shares, balance at Preiod End at Dec. 31, 2014 | 957 | ||||||||
Balance at Period End at Dec. 31, 2014 | 23,355 | $ 50 | 14,121 | 14,436 | (1,343) | 3,951 | 23,313 | 42 | |
Other | (4) | 0 | (10) | 2 | (8) | 4 | |||
Comprehensive Income (loss) | 984 | 1,588 | (612) | 976 | 8 | ||||
Exercise of options by employees and vested RSUs | 388 | $ 0 | 225 | (163) | 388 | ||||
Exercise of options by employees and vested RSUs, shares | 5 | ||||||||
Ordinary shares issuance value | 3,291 | $ 2 | 3,289 | 3,291 | |||||
Ordinary shares issuance | 54 | ||||||||
Stock-based compensation expense | 117 | 117 | 117 | ||||||
Dividends to ordinary shareholders | (1,155) | (1,155) | (1,155) | ||||||
Purchase of treasury shares | 439 | 439 | 439 | ||||||
Acquisition of non-controlling interests | 103 | 103 | |||||||
Accrued Dividends to preferred shareholders | 15 | 15 | 15 | ||||||
Acquisition of non-controlling interests | 103 | 103 | |||||||
Shares, balance at Preiod End at Dec. 31, 2015 | 1,016 | ||||||||
Balance at Period End at Dec. 31, 2015 | 29,927 | $ 52 | 17,757 | 14,851 | $ (1,955) | $ 4,227 | 29,769 | 158 | $ 3,291 |
Mandatory Convertible Preferred Stock Issuance | 3,291 | 3,291 | $ 3,291 | ||||||
Other | $ 7 | $ 0 | $ 5 | $ (3) | $ 2 | $ 5 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOW - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Operating activities: | |||
Net income | $ 1,597 | $ 3,042 | $ 1,253 |
Adjustments to reconcile net income to net cash provided by operations: | |||
Depreciation and amortization | 1,308 | 1,508 | 1,642 |
Net change in operating assets and liabilities | 967 | 290 | 968 |
Other than temporary loss on investment in securities | 736 | 6 | 0 |
Deferred Income Taxes Net And Uncertain Tax Positions | 237 | (226) | (1,380) |
Research and development in process | 35 | 0 | 5 |
Impairment of long lived assets | 361 | 387 | 524 |
Impairment Of Equity Investment - Net | 124 | ||
Stock-based compensation | 117 | 95 | 64 |
Other items | 146 | 24 | 143 |
Net (gain) loss from sale of long-lived assets and investments | (86) | 1 | 18 |
Net cash provided by operating activities | 5,542 | 5,127 | 3,237 |
Investing activities: | |||
Acquisitions of businesses, net of cash acquired | (3,309) | (363) | (39) |
Purchase of property, plant and equipment | (772) | (929) | (1,031) |
Purchase of investments and other assets | (2,003) | (324) | (160) |
Proceeds From Sales of Long Lived Assets And Investments | 524 | 196 | 187 |
Other investing activities | (5) | (30) | (104) |
Net cash used in investing activities | (5,565) | (1,450) | (1,147) |
Financing activities: | |||
Proceeds from issuance of ordinary shares, net of issuance costs | 3,291 | ||
Proceeds from issuance of mandatory convertible preferred shares, net of issuance costs | 3,291 | ||
Purchase of treasury shares | (439) | (500) | (497) |
Net change in short-term debt | 29 | (385) | 384 |
Dividends paid | (1,155) | (1,156) | (1,089) |
Proceeds from exercise of options by employees | 388 | 514 | 91 |
Proceeds From Long Term Loans And Other Long Term Liabilities | 2,099 | 338 | |
Repayment of long-term loans And Other Long Term Liabilities | (2,521) | (839) | (3,133) |
Other financing activities | (178) | (9) | 23 |
Net cash provided by (used in) financing activities | 4,805 | (2,375) | (3,883) |
Translation adjustment on cash and cash equivalents | (62) | (114) | (48) |
Net change in cash and cash equivalents | 4,720 | 1,188 | (1,841) |
Balance of cash and cash equivalents at beginning of year | 2,226 | 1,038 | 2,879 |
Balance of cash and cash equivalents at end of year | 6,946 | 2,226 | 1,038 |
Supplemental disclosure of cash flow information | |||
Interest paid | 243 | 294 | 331 |
Income taxes paid, net of refunds | 802 | 675 | 1,298 |
Amendment Sixty Nine And Tax Audits Payments | 790 | ||
Net change in operating assets and liabilities | |||
Accounts receivable net of sales reserves and allowances | 763 | 710 | 85 |
Inventories | 129 | 230 | 399 |
Other current assets | 87 | (36) | 106 |
Accounts payable and accruals and other current liabilities | (12) | (614) | 378 |
Net change in operating assets and liabilities | $ 967 | $ 290 | $ 968 |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2015 | |
Significant Accounting Policies [Abstract] | |
Basis Of Presentation And Significant Accounting Policies | TEVA PHARMACEUTICAL INDUSTRIES LIMITED Notes to Consolidated Financial Statements NOTE 1—SIGNIFICANT ACCOUNTING POLICIES: 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 i n the development, manufacturing, marketing and distribution of generic, specialty, and other pharmaceutical products . The majority of the Group's revenues are in the United States and Europe . The Group's main manufacturing facilities are located in Israel, Hungary, United States, Germany, Canada, Japan, Ireland, the United Kingdom, t he Czech Republic, Croatia , Italy and India . Accounting principles The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”). Functional currency A major part of the Group's operations is carried out by the Company and its subsidiaries 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 consolidat ed financial statements , translat ed into U.S. dollars. Assets and liabilities are translated at year-end exchange rates, while revenues and expenses are translated at monthly average exchange rates during the year. Differences resulting from translation are presented as other comprehensive income in the consolidated statements of comprehensive income. The financial statements for our Venezuela n business , which has a highly inflationary economy , are remeasured as if the functional currency was the U.S. dollar, Teva's reporting currency, using a translation rate determined by the country's official preferential rate. A highly inflationary economy is one that has cumulative inflation of approximately 100 percent or more over a 3-year period. See note 16a. Use of estimates in the preparation of financial statements The preparation of financial statements in conformity with US GAAP requires management 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 uncertain tax positions, valuation allowances, assessment of impairment of intangible assets and goodwill , purchase price allocation on acquisitions , contingencies, restructuring and sales and reserves allowances . Principles of consolidation: The consolidated financial statements include the accounts of the Company and its majority-owned subsidiaries and Variable Interest Entities ("VIEs") for which the Company is considered the primary beneficiary. For VIEs, the Company perform s an analysis to determine whether the variable interests give a controlling financial interest in a VIE ; t he Company periodically reassesses whether it controls its VIEs . I ntercompany transactions and balances are eliminated in consolidation; profits from intercompany sales, not yet realized outside the Group, are also eliminated . The Company includes the results of operations of acquired businesses from the date of acquisition. Investee companies: I nvestments in entities in which the Company has a significant influence are accounted for using the equity method and included within other non-current assets. Under the equity method , the Company generally recognizes its proportionate share of comprehensive income or loss of the entity. Other non-marketable equity investments are carried at cost. The Company also reviews these investments for impairment whenever events indicate the carrying amount may not be recoverable. Impairments on investee companies are recorded in the income statement under share in losses of associated companies – net . 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. e. Inventories: Inventories are valued at the lower of cost or market. Cost of raw and packaging materials is determined mainly on a moving average basis. Cost of purchased products is determined mainly on a standard cost basis, approximating average costs. Cost of manufactured finished products and products in process is calculated assuming normal manufacturing capacity as follows: raw and packaging materials component is determined mainly on a moving average basis , while the capitalized production costs are determined either on a n average basis over the production period , or on a standard cost bas is, approximating average costs. Inventories acquired in a business combination are stepped-up to their estimated fair value and amortized to c ost of sales as that inventory is sold . Teva updated its inventory policy to verify that inventory is measured against net realizable value, as defined by the new accounting pronouncement. f. Investment in s ecurities: Investment in securities consists mainly of debt and equity securities classified as available-for-sale and recorded at fair value. The fair value of quoted securities is based on current market value. When debt securities do not have an active market, fair value is determined using a valuation model. This model is based on reference to other instruments with similar characteristics, or a discounted cash flow analysis, or other pricing models making use of market inputs and relying as little as possible on entity-specific inputs . U nrealized gains of available for sale 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 both debt and equity securities are included in f inancial 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, and for equity securities, the Company's ability and intent to hold the investment for the length of time necessary to allow for the recovery of the market value . 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 f inancial 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 . g. Long-lived assets : Teva's long-lived, non-current assets are comprised mainly of goodwill, identifiable intangible assets and property, plant and equipment. Teva review s its long-lived assets and perform s detailed testing whenever potential impairment indicators are present. In addition, the Company perform s impairment testing as of October 1 of each year for goodwill and identifiable indefinite life intangible assets . Goodwill Goodwill reflects the excess of the consideration paid or transferred plus the fair value of contingent consideration and any non-controlling interest in the acquiree at the acquisition date over the fair values of the identifiable net assets acqu ired. The goodwill impairment test is performed according to the following principles: An initial qualitative assessment of the likelihood of impairment may be performed. If this step does not result in a more likely than not indication of impairment, no further impairment testing is required. If it does result in a more likely than not indication of impairment, the impairment test is performed. In step one of the impairment test, Teva compares the fair value of the reporting units to the carrying value of net assets allocated to the reporting units. If the fair value of the reporting unit exceeds the carrying value of the net assets allocated to that unit, goodwill is not impaired, and no further testing is required. Otherwise , Teva must perform the second step of the impairment test to measure the amount of the impairment. In the second step, the reporting unit's fair value is allocated to all the assets and liabilities of the reporting unit, including any unrecognized intangible assets, in a hypothetical analysis that simulates the business combination principles to derive an implied goodwill value. If the implied fair value of the reporting unit's goodwill is less than its carrying value, the difference is recorded as an impairment. 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 using mainly the straight-line method over their estimated period of useful life , or based on economic effect models, if more appropriate, which is determined by identifying the period 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 expenses. For definite life intangibles, whenever impairment indicators are identified , Teva reconsiders the asset's estimated life, calculate s the undiscounted value of the asset's cash flows and compare s such value against the asset'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 . Indefinite life intangible assets are mainly comprised of research and develop ment in-process . Teva monitors development for any triggering events. Annually or when triggering events are present, Teva determine s the fair value of th e asset based on discounted cash flows on and records an impairment loss if book value exceeds fair value. Research and development in-process acquired in a business combination is capitalized as an i ndefinite life intangible asset until the related research and development efforts are either completed or abandoned. In the reporting period where they are treated as indefinite life intangible assets, they are not amortized but rather are monitored 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, the related research and development assets are impaired. 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, whenever impairment indicators are identified , Teva reconsiders the asset's estimated life, calculate s the undiscounted value of the asset's cash flows and compare s such value against the asset's carrying amount. If the carrying amount is greater, Teva record s an impairment loss for the excess of book value over fair value . h . Contingencies: The Company and its subsidiaries are 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 or contingent consideration or 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 virtually certain of occurring at the gross amount that is expected to be collected. Legal costs are expensed as incurred . Contingent considerati on and other contingent liabilities incurred or acquired in a business combination are recorded at a probability weighted assessment of their fair value and monitored on an ongoing basis for changes in that value. 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-evaluate s its tax positions based on developments in its tax audits, statute of limitations expirations, changes in tax laws and new information that can affect the technical merits and change the assessment of Teva's ability to sustain the tax benefit. In addition, the Company classifies interest and penalties recognized in the financial statements relating to uncertain tax position under the income taxes line item . P rovisions for uncertain tax positions, where as 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 . j . Treasury shares: Treasury shares are held by Teva's subsidiaries and presented as a reduction of Teva shareholders' equity and carried at their cost to Teva, under t reasury shares. k . Stock-based compensation: Teva recognizes the estimated fair value of share-based awards, restricted share units (“RSUs”) and performance share units ("PSUs"), net of estimated forfeitures, under stock-based compensation costs. 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 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. l . Revenue recognition: 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 under current liabilities. Prompt payment discounts are netted against accounts receivable. 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 new 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 m ilestone events stipulated in agreements is recognized when the milestone is achieved. Milestones are based upon the occurrence of a substantive element specified in the contract or as a measure of substantive progress towards completion under the contract. R evenue s from licensees, sales of l icensed 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. Revenues include royalty income and income from services , which amounted to $ 140 million, $167 million and $182 million in the years ended December 31, 2015 , 2014 and 2013 , respectively. m . 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 and capitalized. Such amounts are recognized as an expense as the related goods are delivered or the services are performed. Research and development in-process acquired as part of an asset purchase, which has not reached technological feasibility and has no alternative future use, is expensed as incurred. n . Shipping and handling costs: Shipping and handling costs, which are included in selling and marketing expenses , amounted to $ 127 million, $ 151 million and $ 232 million for the years ended December 31, 2015 , 2014 and 2013 , respectively. o . Advertising expenses: Advertising expenses are charged to income as incurred. Advertising expenses for the years ended December 31, 2015 , 2014 and 2013 were $ 297 million, $ 302 million and $ 321 million, respectively. p . Deferred i ncome 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 bas i s 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 v aluation 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. I n determining whether a valuation allowance is needed , Teva consider s 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 current or non-current based on the classification of the related asset or liability for financial reporting, or according to the expected reversal dates of the specific temporary differences where appropriate. 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. (2) Amounts of tax-exempt income generated from the Company's current A pproved E nterprises and unremitted earnings from foreign subsidiaries retained for reinvestment in the Group. S ee note 1 5 f . q . 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) 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 RSUs and PSUs granted under employee stock compensation plans and one series of convertible senior debentures, using the treasury stock method; (ii) the conversion of the remaining convertible senior debentures using the “if-converted” method, by adding to net income interest expense on the debentures and amortization of issuance costs, net of tax benefits, and by adding the weighted average number of shares issuable upon assumed conversion of the debentures ; and ( iii ) the conversion of the mandatory convertible preferred shares using the “if-converted” method b y adding to net inco me attributable to ordinary shareholders the dividend s on the preferred shares and by adding the weighted average number of shares issuable upon assumed conversion of the mandatory convertible preferred shares . r . Concentration of credit risks: Most of Teva 's cash and cash equiva lents (which along with investment in securities amounted to $8.4 billion at December 31, 2015) were deposited with financially sound European , U.S. and Israeli banks and financial institutions and were comprised mainly of cash deposits. The pharmaceutical industry, particularly in the U.S. , has been significantly affected by consolidation among managed care providers, large pharmacy chains, wholesaling organizations and other buyer groups. The U.S. market constitutes approximately 57.2 % of Teva's consolidated revenues and a relatively small portion of total trade accounts after net ting amounts in sales, reserves and allowances . T he exposure of credit risks relating to other trade receivables is limited, due to the relatively large number of g roup customers and their wide geographic distribution. T eva performs ongoing credit evaluations of its customers for the purpose of determining the appropriate allowance for doubtful accounts and generally does not require collateral. An appropriate allowance for doubtful accounts is included in the accounts and netted against accounts receivable . s . Derivatives and hedging : The G roup carries out transactions involving derivative financial instruments (mainly forward exchange contracts, written and purchased 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 exposure s . The Company does not enter into derivative transactions for trading purposes. Derivative instruments that qualify for hedge accounting are recognized on the balance sheet at their fair value. For derivative instruments that are designated 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 are recognized in “financial expenses—net” in the statement s of income during the current period. For derivative instruments that are designated and qualify as a cash-flow hedge, the effective portion of 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. The remaining gain or loss on the derivative instrument (i.e., the ineffective portion), if any , is recognized in the statement of income during the current period. 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 i nstruments 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 . 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 credit risk in its assessment of fair value . u . Collaborative arrangements: A C ollaborative agreements are contractual arrangement s 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. See note 2. The Company recognizes revenue generated and costs incurred on sales to third parties as it relate to a collaborative agreement as gross or net . If the Company is the principal participant in a transaction , revenues are record ed on a gross basis ; otherwise, revenues are recorded on a net basis. v . Segment reporting: The Company's business includes two reporting segments: generic and specialty medicines. The generics segment develops, manufactures, sells and distributes generic or branded generic medicines as well as active pharmaceutical ingredients ("API"). The specialty segment engages in the development, manufacture, sale and distribution of branded specialty medicines such as those for central nervous system and respiratory indications, as well as those marketed in the women's health, oncology and other specialty businesses. See note 20 . w . Re structuring : Restructuring charges are initially recorded at fair value, and recognized in connection with restructuring programs designed to reduce the cost structure, increase efficiency and enhance competitiveness . Judgment is used when estimating the impact of restructuring plans, including future termination benefits and other exit costs to be incurred when the actions take place. Costs for one-time termination benefits in which the employee is required to render service until termination in order to receive the benefits are recognized ratably over the future service period. x . Reclassifications: Certain comparative figures have been reclassified to conform to the current year presentation. y . Recently issued accounting pronouncements: In November 2015, the Financial Accounting Standards Board (the "FASB") issued guidance on balance sheet classification of deferred taxes . The new guidance requires entities to present all deferred tax assets and liabilities, along with any related valuation allowance, as non - current on the balance sheet . The guidance is effective for interim and annual periods beginning after December 15, 2016 (early adoption is permitted). Teva is currently evaluating the potential effect of the guidance on its consolidated financial statements. In September 2015, the FASB issued guidance on current a ccounting for m easurement- p eriod a djustments. Th e new guidance requires entities to recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. Measurement period adjustments were previously required to be retrospectively adjusted as of the acquisition date. The provisions of this update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015 (e arly adoption is permitted ), and should be applied prospectively. Teva does not expect this guidance to have a material effect on its consolidated financial statements at the time of adoption of this standard . In July 2015, the FASB issued guidance on current accounting for inventory measurement. The new guidance requires entities to measure inventory at the lower of cost or net realizable value. Net realizable value is defined by the guidance as the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. The guidance is effective for the interim and annual periods beginning on or after December 15, 2016 (early adoption is permitted). Teva adopted the new guidance in the third quarter of 2015, and it had an immaterial impact on its co nsolidated financial statements . In April 2015, the FASB issued guidance on debt issuance costs . The guidance requires entities to present debt issuance costs related to a recognized debt liability as a direct deduction from the carrying amount of that debt in the balance sheet. This guidance does not contain guidance for debt issuance costs related to line-of-credit arrangements. Consequently, in August 2015, the FASB issued additional guidance to add paragraphs indicating that the SEC staff would not object to an entity deferring and presenting debt issuance costs related to line-of-credit arrangements as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement . The guidance is effective for the interim and annual periods beginning on or after December 15, 201 5 . Teva does not expect this guidance to have a material effect on its consolidated financial statements at the time of adoption of this standard . In February 2015, the FASB issued amended guidance on current accounting for consolidation of certain entities. Pursuant to this guidance , reporting enterprises should evaluate whether (a) they should consolidate limited partnerships and similar entities, (b |
CERTAIN TRANSACTIONS
CERTAIN TRANSACTIONS | 12 Months Ended |
Dec. 31, 2015 | |
Certain Transactions [Abstract] | |
Certain Transactions | 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 cost s or business risks. The Company's most significant agreements of this nature are summarized below. < < With Takeda: During 2014, Teva and Takeda entered into agreements allowing Takeda to commercialize Teva's innovative treatments for Parkinson's disease and multiple scleroses (marketed globally under the product names Copaxone ® and Azilect ® ) in Japan. Under these agreements, Teva is entitled to certain development, regulatory and sales-based milestones and royalty payments . With T he Procter & Gamble Company (“P&G”): In November 2011, Teva formed PGT Healthcare, a consumer healthcare joint venture with The Procter & Gamble Company (“P&G”). Headquartered in Geneva, Switzerland, the joint venture focuses on branded OTC medicines in categories such as cough/cold and allergy, digestive wellness, vitamins, minerals and supplements, analgesics and skin medications, and operates in all markets outside North America. Its leading brands are Vicks ® , Metamucil ® , Pepto-Bismol ® , and ratiopharm. PGT Healthcare's strengths include P&G's strong brand-building, consumer-led innovation and go-to-market capabilities; Teva's broad geographic reach, experience in R&D, regulatory and manufacturing expertise and extensive portfolio of products, and each company's scale and operational efficiencies. Teva own s 49% of the joint venture, and P&G holds a controlling financial interest of 51%. The Company recognizes profits of the joint venture based on Teva's ownership percentage. The joint venture has certain independent operations and contracts for other services from its two partners in an effort to leverage their scale and capabilities and thereby maximize efficiencies. Such services include research and development, manufacturing, sales and distribution, administration and other services, provided under agreements with the joint venture. The partners have certain rights to terminate the joint venture after seven years and earlier under other circumstances. In July 2014, Teva sold its U.S. OTC plants, which were purchased as part of the agreement, back to P&G . c. A greements with related parties: In December 2012, Teva entered into a collaborative development and exclusive worldwide license agreement with Xenon for its compound XEN402. XEN402 (now designated TV-45070 by Teva) targets sodium channels found in sensory nerve endings that can increase in chronic painful conditions, and is currently in Phase II clinical development for a variety of pain-related disorders. Under the agreement, Teva paid Xenon an upfront fee of $41 million. In addition, Teva may be required to pay development, regulatory and sales-based milestones of up to $335 million. Xenon is also entitled to royalties on sales and has an option to participate in commercialization in the United States. As required by the agreement, in November 2014, Teva invested an additional $10 million in Xenon in connection with its initial public offering. Dr. Michael Hayden, Teva's President of Global R&D and Chief Scientific Officer, is the founder, a minority shareholder and a member of the board of directors of Xenon. In order to avoid potential conflicts of interest, Teva has established certain procedures to exclude Dr. Hayden from involvement in Teva's decision-making related to Xenon ." id="sjs-B4">NOTE 2 – CERTAIN TRANSACTIONS: a. Business transactions: Japanese business venture: In November 2015, Teva and Takeda Pharmaceutical Company Limited ("Takeda") entered into a definitive agreement to establish a partnership in Japan. The new business venture, intended to create a leading generic pharmaceutical company in Japan , is expected to start operating in the second calendar quarter of 2016. Teva will have a 51% stake in the new company and Takeda will have the remaining 49%; as such, Teva is expected to consolidate the business venture as part of the consolidated financial statements. As the transaction will not become effective until closing, there wa s no material financial impact for Teva in 2015. Rimsa acquisition: On October 1, 2015, Teva entered into a definitive agreement to acquire Representaciones e Investigaciones Médicas , S.A. de C.V. (“ Rimsa ”) , a leading pharmaceutical company in Mexico, along with a portfolio of products, companies, intellectual property, assets and pharmaceutical patents, for an aggregate of $2.3 billion, in a cash free, debt free set of transactions. This acquisition is expected to add a portfolio of patent - protected drugs to Teva's business in Latin America . The transaction is expected to be funded through a combination of available cash and lines of credit. Subject to satisfaction of the closing conditions, Teva expects the acquisition to close in the first quarter of 2016. Actavis Generics acquisition : On July 27, 2015, Teva announced that it entered into a definitive agreement with Allergan plc to acquire Allergan's worldwide generic pharmaceutical business (" Actavis Generics ") . Teva will pay total consideration of $33.75 billion in cash and approximately 100 million Teva shares, to be issued to Allergan at the closing of the transaction. At the time of the announcement, total consideration was estimated to be $40.5 billion. However, the final consideration will be based on the closing price of Teva's ordinary shares at the date of acquisition. Closing of the transaction is subject to certain conditions, including relevant regulatory approvals. We continue to work toward satisfying all conditions in order to close by the end of the first quarter of 2016; however , it is possible that closing may be slightly delayed. On September 25, 2015, Teva entered into a $27 billion bridge loan credit agreement with various banks, to finance a portion of the Actavis Generics acquisition. Any loan under the bridge facility would bear an interest rate of LIBOR plus a margin ranging from 0.30% to 1.65%, so long as Teva maintains an investment-grade credit rating. On November 16, 2015, Teva reduced the amount of the bridge loan from $27 billion to $22 billion and entered into term facilities amounting to $5 billion with a syndicate of banks. The term facilities are split into two tranches of $2.5 billion each, with the first tranche maturing in full after three years and the second tranche maturing in five years with payment installments each year. To date, Teva ha s not drawn any funds under the bridge loan or the term facilities. On December 8, 2015, Teva closed public offerings consisting of 54 million American Depositary Shares (" ADS s") at $62.50 per ADS and 3,375,000 of its 7.00% m andatory c onvertible p referred s hares at $1,000 per share. On January 6, 2016, Teva sold an additiona l 5.4 million ADSs and 337,500 mandatory convertible preferred s hares pursuant to the exercise of the underwriters' over-allotment option. The net proceeds from the offerings were approximately $7.2 billion, after estimated underwriting discounts, commissions and offering expenses payable by Teva . Teva intends to use the net proceeds from these offerings towards the cash portion of the purchase price for Actavis Generics and related fees and expenses, for the pending acquisition of Rimsa or otherwise for general corporate purposes . Pending such use, the Compan y used certain of such proceeds to repay certain indebtedness . Auspex acquisition: In May 2015, Teva acquired Auspex Pharmaceuticals, Inc. (" Auspex ") , an innovative biopharmaceutical company specializing in applying deuterium chemistry to known molecules to create novel therapies with improved safety and efficacy profiles , for n et cash consideration of $3.3 billion. The table below summarizes the preliminary estimates of the fair value of the assets acquired and liabilities assumed and resulting goodwill. These preliminary estimates are subject to revision, which may result in adjustments to the preliminary values presented below . U.S.$ in millions Cash and cash equivalents $ 201 Other current assets 6 Deferred taxes and other assets 126 Identifiable intangible assets: Research and development in-process 3,143 Goodwill 1,146 Total assets acquired 4,622 Current liabilities 29 Deferred taxes 1,131 Total liabilities assumed 1,160 Net assets acquired $ 3,462 Pro forma information giving effect to the acquisition has not been provided as the results would not be material. Eagle license agreement: On February 13, 2015, Teva entered into an exclusive license agreement with Eagle Pharmaceuticals, Inc. ("Eagle") f or Eagle's EP-3102, a bendamustine hydrochloride rapid infusion product for the treatment of chronic lymphocytic leukemia (CLL) and indolent B-cell non-Hodgkin lymphoma (NHL). Under the terms of the agreement, Eagle received an upfront cash payment of $30 million, a first milestone payment of $ 15 million and may receive up to $ 65 million in additional milestone payments as well as royalties on net sales. As the transaction was accounted as a business combination, the acquisition consideration was attribut ed to net assets on the basis of fair value of assets acquired and liabilities assumed based on a preliminary valuation . Other 2015 transactions: During 2015, Teva acquired stakes in Gecko Health Innovations, Inc., Immuneering Corporation and Microchips Biotech, Inc. for an aggregate of approximately $1 0 2 million and certain contingent payments . Labrys acquisition : In J uly 2014, Teva fully acquired Labrys Biologics, Inc. ( " Labrys " ) for an upfront cash payment of $20 7 million and up to $625 m illion in contingent payme nts upon achievement of certain milestones. Labrys is a development stage biotechnology company focused on treatments for chronic migraine and episodic migraine . At the time of the acquisition, the potential additional payments were evaluated and recorded at a fair value of $ 251 million . Pro forma information giving effect to the acquisition has not been provided as the results would not be material . NuPathe acquisition : I n February 2014, Teva completed the acquisition of NuPathe Inc. ("NuPathe") . NuPathe's leading product is Zecuity ® , a prescription migraine patch approved by the FDA for the acute treatment of migraine with or without aura in adults. Teva purchased all of NuPathe's shares for consideration of $1 63 million and up to $130 million in contingent payments upon the achievement of sales-based milestones for Zecuity ® . At the time of the acquisition, t hese potential additional payments were evaluated and recorded at a fair value of $ 106 million , based on the probability of achieving these milestones. Pro forma information giving effect to th e acquisition has not been provided as the results would not be material . b. Significant collaborative 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 cost s or business risks. The Company's most significant agreements of this nature are summarized below. < < With Takeda: During 2014, Teva and Takeda entered into agreements allowing Takeda to commercialize Teva's innovative treatments for Parkinson's disease and multiple scleroses (marketed globally under the product names Copaxone ® and Azilect ® ) in Japan. Under these agreements, Teva is entitled to certain development, regulatory and sales-based milestones and royalty payments . With T he Procter & Gamble Company (“P&G”): In November 2011, Teva formed PGT Healthcare, a consumer healthcare joint venture with The Procter & Gamble Company (“P&G”). Headquartered in Geneva, Switzerland, the joint venture focuses on branded OTC medicines in categories such as cough/cold and allergy, digestive wellness, vitamins, minerals and supplements, analgesics and skin medications, and operates in all markets outside North America. Its leading brands are Vicks ® , Metamucil ® , Pepto-Bismol ® , and ratiopharm. PGT Healthcare's strengths include P&G's strong brand-building, consumer-led innovation and go-to-market capabilities; Teva's broad geographic reach, experience in R&D, regulatory and manufacturing expertise and extensive portfolio of products, and each company's scale and operational efficiencies. Teva own s 49% of the joint venture, and P&G holds a controlling financial interest of 51%. The Company recognizes profits of the joint venture based on Teva's ownership percentage. The joint venture has certain independent operations and contracts for other services from its two partners in an effort to leverage their scale and capabilities and thereby maximize efficiencies. Such services include research and development, manufacturing, sales and distribution, administration and other services, provided under agreements with the joint venture. The partners have certain rights to terminate the joint venture after seven years and earlier under other circumstances. In July 2014, Teva sold its U.S. OTC plants, which were purchased as part of the agreement, back to P&G . c. A greements with related parties: In December 2012, Teva entered into a collaborative development and exclusive worldwide license agreement with Xenon for its compound XEN402. XEN402 (now designated TV-45070 by Teva) targets sodium channels found in sensory nerve endings that can increase in chronic painful conditions, and is currently in Phase II clinical development for a variety of pain-related disorders. Under the agreement, Teva paid Xenon an upfront fee of $41 million. In addition, Teva may be required to pay development, regulatory and sales-based milestones of up to $335 million. Xenon is also entitled to royalties on sales and has an option to participate in commercialization in the United States. As required by the agreement, in November 2014, Teva invested an additional $10 million in Xenon in connection with its initial public offering. Dr. Michael Hayden, Teva's President of Global R&D and Chief Scientific Officer, is the founder, a minority shareholder and a member of the board of directors of Xenon. In order to avoid potential conflicts of interest, Teva has established certain procedures to exclude Dr. Hayden from involvement in Teva's decision-making related to Xenon . |
FAIR VALUE MEASUREMENT
FAIR VALUE MEASUREMENT | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value Measurement [Abstract] | |
Fair Value Measurement | NOTE 3 – FAIR VALUE MEASUREMENT: Financial items carried at fair value as of December 31, 2015 and 2014 are classified in the tables below in one of the three categories described in note 1t: December 31, 2015 Level 1 Level 2 Level 3 Total U.S. $ in millions Cash and cash equivalents: Money markets $ 162 $ - $ - $ 162 Cash deposits and other 6,784 - - 6,784 Investment in securities: Equity securities 1,352 - - 1,352 Structured investment vehicles - 94 - 94 Other 11 - 1 12 Derivatives: Asset derivatives - options and forward contracts - 25 - 25 Asset derivatives - interest rate, cross-currency and forward starting interest rate swaps - 105 - 105 Liabilities derivatives - options and forward contracts - (11) - (11) Liabilities derivatives - treasury locks, interest rate and forward starting interest rate swaps - (26) - (26) Contingent consideration* - - (812) (812) Total $ 8,309 $ 187 $ (811) $ 7,685 December 31, 2014 Level 1 Level 2 Level 3 Total U.S. $ in millions Cash and cash equivalents: Money markets $ 10 $ - $ - $ 10 Cash deposits and other 2,216 - - 2,216 Escrow fund 125 - - 125 Investment in securities: Auction rate securities - - 13 13 Equity securities 66 - - 66 Structured investment vehicles - 96 - 96 Other, mainly debt securities 73 - 1 74 Derivatives: Asset derivatives - options and forward contracts - 82 - 82 Asset derivatives - cross-currency swaps - 20 - 20 Liability derivatives - options and forward contracts - (54) - (54) Liability derivatives - interest rate swaps - (43) - (43) Contingent consideration* - - (630) (630) Total $ 2,490 $ 101 $ (616) $ 1,975 __________________________ * Contingent consideration represents either liabilities or assets recorded at fair value in connection with acquisitions . Teva determined the fair value of the liability or asset of 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 for 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 U.S. and Europe and the discount rate for fair value measurement. The contingent consideration is evaluated quarterly or more frequently if circumstances dictate. Changes in the fair value of contingent consideration are recorded in earnings under i mpairments, restructuring and others . 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, December 31, 2015 2014 U.S. $ in millions Fair value at the beginning of the period $ (616) $ (347) Auction rate securities realized (13) (5) Additional contingent consideration resulting from: Eagle license (128) - Labrys acquisition - (251) Gecko acquisition (5) - NuPathe acquisition - (83) Adjustments to provisions for contingent consideration: Labrys acquisition (311) (1) Eagle license (63) - MicroDose acquisition (10) 83 Cephalon acquisition (5) (56) NuPathe acquisition (10) (6) Settlement of contingent consideration: Labrys acquisition 350 - Cephalon acquisition - 21 Sale of animal health unit - (5) Adjustments to contingent considerations due to changes in purchase price allocations and others - 34 Fair value at the end of the period $ (811) $ (616) Financial instruments not measured at fair value Teva's financial instruments consist mainly of cash and cash equivalents, investments in securities, current and non-current receivables, short-term credit, accounts pa ya ble and accruals, loans and senior notes, convertible senior debentures and derivatives. The fair value of the financial instruments included in working capital and non-current receivab les approximates their carrying value. The fair value of long-term bank loans mostly approximates their carrying value, since they bear interest at rates close to the prevailing market rates. Financial instruments measured on a basis other than fair value are mostly comprised of senior notes and convertible senior debentures, and are presented in the below table in terms of fair value: Estimated fair value* December 31, 2015 2014 (U.S. $ in millions) Senior notes included under long-term liabilities $ (7,305) $ (7,776) Senior notes and convertible senior debentures included under short-term liabilities (1,778) (1,731) Fair value at the end of the period $ (9,083) $ (9,507) * The fair value was estimated based on quoted market prices, where available. |
INVESTMENT IN SECURITIES
INVESTMENT IN SECURITIES | 12 Months Ended |
Dec. 31, 2015 | |
Marketable Securities [Abstract] | |
Marketable Securities | NOTE 4— INVESTMENT IN SECURITIES: Available-for-sale securities: Available-for-sale securities are c omprised mainly of debt securities and equity securities. At December 31, 2015 and 2014 , the fair value, amortized cost and gross unrealized h olding gains and losses of such securities are as follows : Fair value Amortized cost Gross unrealized holding gains Gross unrealized holding losses (U.S. $ in millions) December 31, 2015 $ 1,620 $ 1,303 $ 338 $ 21 December 31, 2014 $ 259 $ 266 $ 19 $ 26 Investments in securities are classified based on the initial maturity as well as the intended time of realization. During the second quarter of 2015, Teva acquired a less than 5% interest in Mylan shares. As the decline in fair value of this inte rest was considered to be other- than - temporary, on June 30, 2015 , a loss of $105 million was recorded under impairments, restructuring and others, reflecting the difference between the purchase price of this interest and its fair value as of June 30, 2015. On September 30, 2015, an additional loss of $623 million was recorded under financial expenses-net, reflecting the difference between the book value of this interest and its fair value. Total loss from the decline in value of the Mylan shares was $728 million. See notes 17 and 18. As of December 31, 2015, unrealized gain of $312 million was recorded in other comprehensive income. Investments in securities are presented in the balance sheet as follows: December 31, 2015 2014 (U.S. $ in millions) Other non-current assets $ 1,447 $ 176 Cash and cash equivalents, mainly money market funds 162 10 Other current assets 11 73 $ 1,620 $ 259 b. Contractual maturities: The contractual maturities of debt securities are as follows: December 31, 2015 (U.S. $ in millions) 2016 $ 173 2021 and thereafter 95 $ 268 |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2015 | |
Inventories [Abstract] | |
Inventories | NOTE 5—INVENTORIES: Inventories, net of reserves, consisted of the following: December 31, 2015 2014 (U.S. $ in millions) Finished products $ 2,050 $ 2,268 Raw and packaging materials 1,195 1,279 Products in process 535 638 Materials in transit and payments on account 186 186 $ 3,966 $ 4,371 |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2015 | |
Property Plant And Equipment [Abstract] | |
Property, Plant and Equipment | NOTE 6—PROPERTY, PLANT AND EQUIPMENT: Property, plant and equipment, net, consisted of the following: December 31, 2015 2014 (U.S. $ in millions) Machinery and equipment $ 5,071 $ 4,893 Buildings 2,591 2,653 Computer equipment and other assets 1,492 1,391 Payments on account 525 571 Land* 394 372 10,073 9,880 Less—accumulated depreciation 3,529 3,345 $ 6,544 $ 6,535 * Land includes long-term leasehold rights in various locations, with useful lives of between 30 and 99 years. Depreciation expenses were $449 million, $464 million and $458 million in the years ended December 31, 2015, 2014 and 2013, respectively. During the years ended December 31, 2015, 2014 and 2013, Teva had impairments of property, plant and equipment in the amount of $96 million, $163 million and $61 million, respectively. See note 18. |
GOODWILL DISCLOSURE
GOODWILL DISCLOSURE | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill [Abstract] | |
Goodwill Disclosure | NOTE 7—GOODWILL: The changes in the carrying amount of goodwill for the years ended December 31, 2015 and 2014 were as follows: Generics Specialty Other Total (U.S. $ in millions) Balance as of January 1, 2014 $ 9,088 $ 8,668 $ 1,225 $ 18,981 Changes during year: Goodwill acquired - 183 - 183 Translation differences and other (358) (349) (49) (756) Balance as of December 31, 2014 $ 8,730 $ 8,502 $ 1,176 $ 18,408 Changes during year: Goodwill acquired* - 1,212 - 1,212 Translation differences and other (265) (294) (36) (595) Balance as of December 31, 2015 $ 8,465 $ 9,420 $ 1,140 $ 19,025 *Mainly due to the Auspex acquisition in May 2015. <>< As of December 31, 2015, 2014 and 2013, the Co mpany determined that there were no impairment s to goodwill. |
IDENTIFIABLE INTANGIBLE ASSET
IDENTIFIABLE INTANGIBLE ASSET | 12 Months Ended |
Dec. 31, 2015 | |
Identifiable Intangible Asset [Abstract] | |
Identifiable Intangible Asset [Text Block] | NOTE 8 - IDENTIFIABLE INTANGIBLE ASSETS: Identifiable intangible assets consisted of the following: Original amount net of impairment Accumulated amortization Amortized balance December 31, 2015 2014 2015 2014 2015 2014 (U.S. $ in millions) Product rights $ 9,047 $ 9,606 $ 5,876 $ 5,343 $ 3,171 $ 4,263 Trade names 212 243 40 54 172 189 Research and development in process 4,332 1,060 0 0 4,332 1,060 Total $ 13,591 $ 10,909 $ 5,916 $ 5,397 $ 7,675 $ 5,512 Product rights and trade names are assets presente d at amortized cost . These assets represent a portfolio of pharmaceutical products from various categories with a weighted average life of approximately 10 years. Amortization of intangible assets amounted to $838 million, $1,036 million and $1,180 million in the years ended December 31, 2015, 2014 and 2013, respectively. Teva's in - process research and development are assets that have not yet been approved in major markets. Teva's in - process research and development is comprised mainly of the following acquisitions and related assets: SD809—multiple indications and SDJ60 idiopathic pulmonary fibrosis ( Auspex ) - $3,143 million; LBR-101 (Labrys) - $444 million; Revascor ® (Cephalon) - $258 million; Reslizumab (formerly known as Cinquil ® , Cephalon) - $215 million ; Technology ( Immuneering ) - $87 million; Technology ( Microchips ) - $76 million; LAMA/LABA (MicroDose) - $62 million and TD Hydrocodone ( Cephalon ) - $47 million. In-process research and development carry intrinsic risks that the asset might not succeed in advanced phases and will be impaired in future periods. <><><> Impairment of identifiable intangible assets amounted to $265 million, $224 million and $393 million in the years ended December 31, 2015, 2014 and 2013, respectively , and are recorded in earnings under i mpairments, restructuring and others . See note 18 . <><><> As of December 31, 2015, the estimated aggregate amortization of intangible assets for the years 2016 to 2020 is as follows: 2016—$584 million; 2017—$521 million; 2018—$518 million; 2019—$430 million and 2020—$368 million. |
SALES RESEARVES AND ALLOWANCES
SALES RESEARVES AND ALLOWANCES | 12 Months Ended |
Dec. 31, 2015 | |
Sales Researves And Allowancess [Abstract] | |
Sales Researves And Allowancess [Text Block] | NOTE 9—SALES RESERVES AND ALLOWANCES: Sales reserves and allowances consisted of the following: December 31, 2015 2014 (U.S. $ in millions) Rebates $ 3,382 $ 2,842 Medicaid 1,319 1,099 Chargebacks 1,091 1,129 Returns 598 593 Other 211 186 $ 6,601 $ 5,849 |
LONG TERM EMPLOYEE RELATED OBLI
LONG TERM EMPLOYEE RELATED OBLIGATIONS | 12 Months Ended |
Dec. 31, 2015 | |
Long Term Employee Related Obligations [Abstract] | |
Long Term Employee Related Obligations | NOTE 10—LONG-TERM EMPLOYEE-RELATED OBLIGATIONS: a. Long-term employee-related obligations consisted of the following: December 31, 2015 2014 (U.S. $ in millions) Accrued severance obligations $ 123 $ 146 Defined benefit plans 157 188 Total $ 280 $ 334 <> As of December 31, 2015 and 2014 , the Group had $140 million and $146 million, respectively, deposited in funds managed by financial institutions that are earmarked by management to cover severance pay liability mainly in respect of Israeli employees. Such deposits are not considered to be “plan assets” and are therefore included in long-term investments and receivables. 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 $126 million in 2016 to the pension funds and insurance companies in respect of its severance and pension pay obligations. <> The main terms of the different arrangements with employees are described in b. 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. According to the general collective pension agreement in Israel, Company deposits with respect to employees who were employed by the Company after the agreement took effect 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 the collective pension agreement effective date, a s 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. <><> Europe Many of the employees in the Company's European subsidiaries are entitled to a retirement grant when they leave. In the consolidated financial statements, the liability of the 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 C ompany uses December 31 as the measurement date for defined benefit plans. <><> North America <> The Company's North American subsidiaries mainly provide various defined contribution plans for the benefit of their employees. Under these plans, contributions are based on specified percentages of pay. Additionally, a multi-employer plan is maintained in accordance with various union agreements. <><> Latin America <> 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 reflec t 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 ben efits to its employees: $8 million in 2016 ; $7 million in 2017 ; $11 million in 2018 ; $11 million in 2019 ; $8 million in 2020 and $50 million between 20 20 to 20 24 . These amounts do not include amounts that might be paid to employees who cease working with the Company before their normal retirement age. |
DEBT OBLIGATIONS
DEBT OBLIGATIONS | 12 Months Ended |
Dec. 31, 2015 | |
Debt Obligations [Abstract] | |
Senior Notes and Loans | NOTE 11—DEBT OBLIGATIONS: a. Short-term debt: December 31, Weighted average interest rate as of December 31 Maturity 2015 2014 (U.S. $ in millions) Bank and financial institutions 2.05% $ 75 $ 46 Convertible debentures (see note 12) 0.25% 2026 521 530 Current maturities of long-term liabilities 989 1,185 Total short term debt $ 1,585 $ 1,761 <> Short-term debt has an earliest date of repayment within 12 months . Line of credit: In November 2015 , the Company entered into a $ 3 billion five-year unsecured syndicated credit facility (which will increase to $4.5 billion upon closing of the Actavis Generics acquisition , see note 2 ) , replacing the previous $ 3 billion facility. As of December 31, 2015, the credit facility remained unutilized. b. Long-term debt includes the following: Weighted average interest rate as of December 31, 2015 Maturity December 31, 2015 2014 % (U.S. $ in millions) Senior notes USD 613 million (1) 3.65% 2021 $ 611 $ 873 Senior notes USD 588 million (1) 3.65% 2021 586 873 Senior notes USD 700 million 2.25% 2020 700 700 Senior notes USD 950 million 2.40% 2016 950 950 Senior notes EUR 1,000 million 2.88% 2019 1,092 1,213 Senior notes USD 789 million (1) 6.15% 2036 780 974 Senior notes USD 844 million (1) 2.95% 2022 843 1,297 Senior notes CHF 450 million 1.50% 2018 455 455 Senior notes EUR 1,300 million (2) 1.25% 2023 1,409 - Senior notes EUR 700 million (2) 1.88% 2027 762 - Senior notes USD 1,000 million (3) 3.00% 2015 - 1,000 Fair value hedge accounting adjustments (10) (43) Total senior notes $ 8,178 $ 8,292 Term loan EUR 122 million (4) EURIBOR + 1.0% 2015 - 148 Term loan JPY 35 billion 1.42% 2019 290 293 Term loan JPY 65 billion 0.99% 2017 544 549 Term loan JPY 35 billion LIBOR +0.3% 2018 290 293 Other loans JPY 5 billion (5) 1.67% 2019 39 118 Total loans $ 1,163 $ 1,401 Debentures USD 15 million 7.20% 2018 15 15 Other 7.48% 2026 5 - Total debentures and others $ 20 $ 15 Less current maturities 989 1,185 Derivative instruments 11 43 Total long term debt (6) $ 8,383 $ 8,566 In February 2015, Teva consummated a cash tender offer for certain of its outstanding senior notes. Teva paid $1.3 billion in aggregate consideration (applicable purchase price including premium and accrued interest) to redeem $1.2 billion aggregate principal amount of senior notes. Concurrently, Teva terminated an interest swap agreement designated as fair value hedge relating to its 2.95% senior notes due 2022 with respect to $456 million notional amount. In addition, Teva terminated a cross-currency swap agreement designated as cash flow hedge relating to its 3.65% senior notes due 2021 with respect to $287 million notional amount. The Company recorded $143 million expense in connection with the debt tender offer and the termination of the related swap agreements, recognized under financial expenses – net (see note 17). In March 2015, Teva Pharmaceutical Finance Netherlands II B.V., a Teva finance subsidiary, issued senior notes in an aggregate principal amount of €2.0 billion, comprised of: €1.3 billion due in March 2023 bearing interest of 1.25% and €0.7 billion due in Marc h 2027 bearing interest of 1.88 %. All such notes are guaranteed by Teva . In June 2015, Teva repaid at maturity $1.0 billion principal amount of its 3% fixed rate senior notes and settled the related $1.0 billion notional amount cross-currency swap agreement designated as cash flow hedge of these notes. In January 2015 , Teva repaid a loan from the European Investment Bank (EIB) in the amount of € 1 22 million . The loan had borne interest determined on the basis of EURIBOR + 1%. Comprised of several JPY loans. Maturity was computed using weighted averages. Management expects the loans to be repaid in 2016. Long term debt as of December 31, 2015 is effectively denominated (taking into consideration cross currency swap agreements) in the following currencies: euro 46%, U.S. dollar 35%, JPY 14% and Swiss franc 5%. Certain loan agreements and debentures contain restrictive covenants, mainly the requirement to maintain certain financial ratios. As of December 31, 2015, the Company met all financial covenants. The Company and certain subsidiaries entered into negative pledge agreements with certain banks and institutional investors. Under the agreements, the Company and such subsidiaries have undertaken not to register floating charges on assets in favor of any third parties without the prior consent of the banks, to maintain certain financial ratios and to fulfill other restrictions, as stipulated by the agreements. The required annual principal payments of long-term debt as of December 31, 2015, starting with the year 2017, are as follows: December 31, 2015 (U.S. $ in millions) 2017 $ 544 2018 760 2019 1,382 2020 700 2021 and thereafter 4,997 $ 8,383 |
CONVERTIBLE SENIOR DEBENTURES
CONVERTIBLE SENIOR DEBENTURES | 12 Months Ended |
Dec. 31, 2015 | |
Convertible Senior Debentures [Abstract] | |
Convertible Senior Debentures | NOTE 1 2 —CONVERTIBLE SENIOR DEBENTURES : Convertible senior debentures amounted to $521 and $530 mi llion principal amount of our 0.25% convertible senior debentures due 2026 as of December 31, 2015 and 2014 , respectively. 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 bala nce sheet under short-term debt . Holders of the convertible debentures were able to cause Teva to redeem the debentures o n February 1, 2016 and have another right to cause Teva to do so on February 1, 2021. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2015 | |
Commitments And Contingencies [Abstract] | |
Commitments And Contingencies | NOTE 13—COMMITMENTS AND CONTINGENCIES: a. Commitments: Pending acquisitions : On October 1, 2015, Teva agreed to acquire Rimsa for $2.3 billion in cash and on July 27, 2015, it announced its agreement to acquire Actavis Generics for $33.75 billion in cash and approximately 100 million Teva shares. See note 2. Preferred dividends : T he Company pay s dividend s under its outstanding mandatory convertible preferred shares . S ee note 14b . Operating leases: As of December 31, 2015, minimum future rentals under operating leases of buildings, machinery and equipment for periods in excess of one year were as follows: 2016—$141 million; 2017—$115 million; 2018—$92 million; 2019—$59 million; 2020—$39 million; 2021 and thereafter—$111 million. The lease fees expensed in each of the years ended December 31, 2015, 2014 and 2013 were $122 million, $153 million and $117 million, respectively. Royalty commitments: The Company is committed to paying royalties to owners of know-how, partners in alliances and other certain arrangements and to parties that financed research and development, at a wide range of rates as a percentage of sales or of the gross margin of certain products, as defined in the underlying agreements. Royalty expenses are reported in cost of goods sold if related to the acquisition of a product , and if not are included in sales and marketing expenses. The royalty expense in each of the years ended December 31, 2015, 2014 and 2013 were $911 million , $987 million and $1.1 b illion, respectively. Milestone commitments: The Company is committed to pay ing milestone payments , usually as part of business transactions. Such payments are contingent upon the achievement of certain regulatory milestones and sales targets. A s of December 31, 2015, were all milestones and targets, for compounds in Phase II and more advanced stages of development, to be achieved, the total contingent payments could reach an aggregate of up to approximately $2.3 billion . 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 believes that it has meritorious defenses to all 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 these cases, 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. Based on currently available information, Teva believes that none of the proceedings brought against it described below is likely to have a material adverse effect on its financial condition. However, if one or more of such proceedings were to result in final judgments against Teva, such judgments could be material to its results of operations and cash flow 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. 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. All third-party sales figures given below are based on IMS data. 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. This could be before any court decision is rendered or while an appeal of a lower court decision is 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. 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 be calculated based on the sales of Teva's generic product. The amount of lost profits would be based on the lost sales of the branded product. The launch of an authorized generic and other generic competition may be relevant to the damages calculation. 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, where Teva has in recent years increased the number of launches of its generic versions of branded pharmaceuticals prior to the expiration of the innovator's patents. 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 June 2013, Teva settled its pantoprazole patent litigation with Wyeth and agreed to pay $1.6 billion, which was completed on October 1, 2014. Teva has sought insurance coverage to defray such amount, and to date, Teva has recovered approximately $339 million from certain of its insurance carriers. In September 2012, Teva launched its 10, 20, 30, 40, 50, and 60 mg methylphenidate ER products, which are the AB-rated generic versions of UCB's Metadate CD® capsules, which had annual sales of approximately $154 million for the twelve months ended September 2012. In December 2012, UCB sued Teva in the United States District Court for the Northern District of Georgia for infringement of UCB's formulation patent, which expires in October 2020. On March 18, 2015, the District Court granted Teva's motion for summary judgment of noninfringement. The case was dismissed on May 12, 2015. Teva continues to sell its methylphenidate ER products. On April 28, 2015, Teva launched its 2 mg, 5 mg, 10 mg, 15 mg, 20 mg, and 30 mg aripiprazole tablets, which are the AB-rated versions of Otsuka's Abilify ® , which had annual sales according to IMS of approximately $7.8 billion for the twelve months ending December 2014. Otsuka has sued Teva in New Jersey federal court for infringement of patents that expire in March 2023 and March 2027. On April 16, 2015, the court denied Otsuka's motion for a temporary restraining order based on one of the patents in suit. On January 20, 2016, the court issued an order granting summary judgment on the grounds that Teva's generic product does not infringe Otsuka's patent directed to using aripriprazole in combination with certain anti-depressants. Otsuka plans to seek interlocutory appeal of this decision. The court has not yet issued decisions on the other patents in suit. No trial date has been scheduled. Were Otsuka ultimately to be successful in its allegation of patent infringement, Teva could be required to pay damages relating to past sales of its aripiprazole products and enjoined from future sales until patent expiry. The amount of damages, if any, would be determined through a separate trial. Product Liability Litigation Teva's business inherently exposes it to potential product liability claims, and in recent years the number of product liability claims asserted against Teva has increased. 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 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 commercial insurance it desires, or any commercial insurance on reasonable terms, in all of its markets. Teva and/or its subsidiaries have been named as defendants in approximately 4,000 product liability lawsuits brought against them and other manufacturers by approximately 4,400 plaintiffs claiming injuries (including allegations of neurological disorders, such as tardive dyskinesia) from the long-term use of metoclopramide (the generic form of Reglan ® ). Certain of these claims are covered by insurance. For over 20 years, the FDA-approved label for metoclopramide has contained warning language about the risk of tardive dyskinesia, and that the risk of developing the disorder increases with duration of treatment and total cumulative dose. In February 2009, the FDA announced that manufacturers of metoclopramide would be required to revise the label, including the addition of a “black box” warning about the risk of tardive dyskinesia resulting from long-term usage. The cases of approximately 500 of the plaintiffs have been dismissed or otherwise resolved to date. Teva expects to be dismissed from at least some of the remaining cases on the basis that some plaintiffs cannot demonstrate that they used a Teva product. Approximately 40% of the plaintiffs are parties to cases against Teva that are part of a mass tort proceeding in the Philadelphia Court of Common Pleas. In addition, there are mass tort proceedings under way in state courts in California and New Jersey. The California litigation includes about half of the total plaintiffs. In the New Jersey proceeding, the trial court granted the defendants' motion to dismiss, on federal preemption grounds, all claims other than those based on an alleged failure to timely update the label. The appellate court affirmed, and the New Jersey Supreme Court has agreed to hear Teva's further appeal of the decision with respect to the update claims. All of the cases in the New Jersey proceeding with respect to the generic defendants have been stayed pending resolution of the appeal. 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. Occasionally, Teva and its subsidiaries have been named as defendants in cases that allege antitrust violations arising from such settlement agreements. Teva believes that its settlement agreements are lawful and serve to increase competition, and intends to defend them vigorously. However, the plaintiffs in these cases typically allege (1) that Teva received something of value from the innovator in exchange for an agreement to delay generic entry, and (2) that they would have realized significant savings if there had been no settlement and competition had commenced earlier. These 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, trebled under the relevant statutes, plus attorneys' fees and costs. The damages allegedly caused by the alleged delays in generic entry generally depend on the size of the branded market and the length of the alleged delay, and can be substantial, particularly where the alleged delays are lengthy or branded drugs with sales in the billions of dollars are involved. On June 17, 2013, the United States Supreme Court held, in Federal Trade Commission v. Actavis, Inc . (the “AndroGel case”), that a rule of reason test should be applied in analyzing whether such settlements potentially violate the federal antitrust laws. The Supreme Court held that a trial court must analyze each agreement in its entirety in order to determine whether it violates the antitrust laws. This new test may lead to increased scrutiny of Teva's patent settlements, additional action by the Federal Trade Commission (“FTC”), and an increased risk of liability in Teva's currently pending antitrust litigations. In April 2006, certain subsidiaries of Teva were named in a class action lawsuit filed in the United States 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 ® ) were unlawful because they had the effect of excluding generic competition. The case also alleges that Cephalon improperly asserted its Provigil® patent against the generic pharmaceutical companies. The first lawsuit was brought by King Drug Company of Florence, Inc. on behalf of itself and as a proposed class action on behalf of any other person or entity that purchased Provigil ® directly from Cephalon (the “Direct Purchaser Class”). Similar allegations have been made in a number of additional complaints, including those filed on behalf of a proposed class of end payors of Provigil (the “End Payor Class”), by certain individual end payors, by certain retail chain pharmacies and by Apotex, Inc. (collectively, these cases are referred to as the “Philadelphia Modafinil Action”). Separately, Apotex challenged Cephalon's Provigil ® patent, and in October 2011, the Court found the patent to be invalid and unenforceable based on inequitable conduct. This decision was affirmed on appeal in April 2013. Teva has either settled or reached agreements in principle to settle with all of the plaintiffs in the Philadelphia Modafinil Action. In February 2008, following an investigation, the FTC sued Cephalon only, alleging that Cephalon violated Section 5 of the Federal Trade Commission Act, which prohibits unfair or deceptive acts or practices in the marketplace, by unlawfully maintaining a monopoly in the sale of Provigil ® and improperly excluding generic competition (the "FTC modafinil Action") . In addition to the Philadelphia Modafinil Action and the FTC modafinil Action , the City of Providence, Rhode Island and the State of Louisiana have also filed lawsuits against Cephalon and other Teva subsidiaries. Cephalon and other Teva subsidiaries have also received notices of potential claims related to the Provigil ® settlement agreements by certain other claimants. Annual sales of Provigil ® were approximately $500 million at the time of the settlement agreements, and approximately $1 billion when the first generic modafinil product was launched in March 2012. On May 28, 2015, Cephalon entered into a consent decree with the FTC 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 for prior settlements) by Cephalon and Teva into a settlement fund. The net amount paid into the settlement fund may be used to settle certain other related cases, including the claims still pending in the litigation described above, as well as other government investigations. Under the consent decree, Teva also agreed to certain injunctive relief with respect to the types of settlement agreements Teva may enter into to resolve patent litigation in the United States for a period of ten years. If, at the end of the ten years, the entire settlement fund has not been fully disbursed, any amount remaining will be paid to the Treasurer of the United States. On July 16, 2015, Teva made a payment into the settlement fund for the difference of $1.2 billion less the amount of the agreed-upon settlements reached as of that date. Management recorded an additional charge of $398 million in the second quarter of 2015 as a result of the settlement with the FTC. In April 2011, the European Commission opened a formal investigation against both Cephalon and Teva to assess whether the 2005 settlement agreement between the parties might have had the object or effect of hindering the entry of generic modafinil. The opening of proceedings indicates that the Commission will investigate the case as a matter of priority, but does not mean that there has been a definitive finding of violation of law. Barr Laboratories, Inc., a subsidiary of Teva (“Barr”), is a defendant in actions in California, Florida and Kansas alleging that a January 1997 patent litigation settlement agreement between Barr and Bayer Corporation was anticompetitive and violated state antitrust and consumer protection laws. In the California case, the trial court granted defendants' summary judgment motions, and the California Court of Appeal affirmed in October 2011. While the appeal was pending before the California Supreme Court t he trial court approved a $74 million class settlement with Bayer. On May 7, 2015, the California Supreme Court reversed and remanded the case back to the trial court for a rule of reason inquiry as to the remaining defendants, including Barr . A trial has been scheduled for October 2016. Based on the plaintiffs' expert testimony in a prior federal multidistrict litigation, estimated sales of ciprofloxacin in California were approximately $500 million during the alleged damages period. Barr remains a party to both the California and Florida actions. In the Kansas action, the court granted preliminary approval of the settlement Bayer entered into with plaintiffs on June 5, 2015. On July 22, 2015, Barr and the remaining co-defendants also agreed to settle with the plaintiffs. The settlement has been submitted to the court for approval, following which the case will be dismissed. 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) entered into in November 2005. The cases were filed by a purported class of direct purchasers, by a purported class of indirect purchasers and by certain chain pharmacies. The plaintiffs claim that the settlement agreement between Wyeth and Teva unlawfully delayed generic entry. On October 7, 2014, the court granted Teva's motion to dismiss in the direct purchaser cases, after which the parties agreed that the court's reasoning applied equally to the indirect purchaser cases. Plaintiffs filed notices of appeal, and the Third Circuit has consolidated the appeal with a separate antitrust case in which Teva is not a party, In re Lipitor Antitrust Litigation , solely for purposes of disposition by the same appellate panel. Annual sales of Effexor ® XR were approximately $2.6 billion at the time of settlement and at the time generic versions were launched in July 2010. In February 2012, two purported classes of direct-purchaser plaintiffs sued GlaxoSmithKline (“GSK”) and Teva for alleged violations of the antitrust laws in connection with their settlement of patent litigation involving lamotrigine (generic Lamictal ® ) entered into in February 2005. In August 2012, a purported class of indirect purchaser plaintiffs filed a nearly identical complaint against GSK and Teva. The plaintiffs claim that the settlement agreement unlawfully delayed generic entry and seek unspecified damages. In December 2012, the District Court dismissed the cases. On January 24, 2014, the District Court denied the direct purchaser plaintiffs' motion for reconsideration and affirmed its original dismissal of the cases. On June 26, 2015, the Third Circuit reversed and remanded for further proceedings. The defendants' petitions for review by the full court were denied on September 23, 2015. Litigation has resumed in the district court in both the direct purchaser and indirect purchaser actions. Teva and GSK filed a motion for judgment on the pleadings in the indirect purchaser action on December 28, 2015. Annual sales of Lamictal ® were approximately $950 million at the time of the settlement, and approximately $2.3 billion at the time generic competition commenced in July 2008. On June 18, 2014, two groups of end payors sued AstraZeneca and Teva, as well as Ranbaxy and Dr. Reddy's, in the Philadelphia Court of Common Pleas for violating the antitrust laws by entering into settlement agreements to resolve the esomeprazole (generic Nexium ® ) patent litigation (the “Philadelphia Esomeprazole Actions”). These end payors had opted out of a class action that was filed in the Massachusetts federal court in September 2012 and resulted in a jury verdict in December 2014 in favor of AstraZeneca and Ranbaxy (the “Massachusetts Action”). Prior to the jury verdict, Teva settled with all plaintiffs for $24 million. The allegations in the Philadelphia Esomeprazole Actions are nearly identical to those in the Massachusetts A ction. The Philadelphia Esomeprazole Actions are stayed pending resolution of the Massachusetts Action, which is currently on appeal to the First Circuit with respect to the claims against the non-settling defendants AstraZeneca and Ranbaxy. In April 2013, purported classes of direct purchasers of, and end payors for, Niaspan ® (extended release niacin) sued Teva and Abbott for violating the antitrust laws by entering into a settlement agreement in April 2005 to resolve patent litigation over the product. A multidistrict litigation has been established in the United States District Court for the Eastern District of Pennsylvania. Teva and Abbott's motion to dismiss was denied on September 8, 2014. In March, April and December 2015 and in January 2016 , several individual direct purchaser opt-out plaintiffs filed complaints with allegations nearly identical to those of the direct purchaser class. Annual sales of Niaspan ® were approximately $416 million at the time of the settlement and approximately $1.1 billion at the time generic competition commenced in September 2013. Since July 2013, numerous lawsuits have been filed in several federal courts by purported classes of end payors for, and direct purchasers of, Solodyn ® ER (minocycline hydrochloride) against Medicis, the innovator, and several generic manufacturers, including Teva. The lawsuits allege, among other things, that the settlement agreements between Medicis and the generic manufacturers violated the antitrust laws. Teva entered into its agreement with Medicis in March 2009. A multidistrict litigation has been established in the United States District Court for the District of Massachusetts. On September 12, 2014, plaintiffs filed an amended complaint that did not name Teva as a defendant. Annual sales of Solodyn ® ER were approximately $380 million at the time Teva settled, and approximately $765 million at the time generic competition entered the market on a permanent basis in November 2011. Since November 2013, numerous lawsuits have been filed in several federal courts by purported classes of end payors for, and direct purchasers of, Aggrenox ® (dipyridamole/aspirin tablets) against Boehringer Ingelheim (“BI”), the innovator, and several Teva subsidiaries. The lawsuits allege, among other things, that the settlement agreement between BI and Barr entered into in August 2008 violated the antitrust laws. A multidistrict litigation has been established in the United States District Court for the District of Connecticut. Teva and BI's motion to dismiss was denied on March 23, 2015. Defendants' motion for certification for an immediate appeal of that decision was granted on July 21, 2015, but the Second Circuit denied hearing the appeal. Annual sales of Aggrenox ® were approximately $340 million at the time of the settlement, and were approximately $455 million at the time generic competition began in July 2015. Teva launched a generic version of Aggrenox ® in July 2015. Since January 2014, numerous lawsuits have been filed in the United States District Court for the Southern District of New York by purported classes of end payors for and direct purchasers of ACTOS ® and ACTO plus Met ® (pioglitazone and pioglitazone plus metformin) against Takeda, the innovator, and several generic manufacturers, including Teva. The lawsuits allege, among other things, that the settlement agreements between Takeda and the generic manufacturers violated the antitrust laws. Teva entered into its agreement with Takeda in December 2010. Defendants' motions to dismiss with respect to the end payor lawsuits were granted on September 23, 2015. On October 22, 2015, the end payors filed a notice of appeal of this ruling. The lawsuits brought by the direct purchasers were stayed pending a ruling on the motions to dismiss the end payor lawsuits. Following the ruling on the motions to dismiss in the end payor lawsuits, the direct purchaser plaintiffs amended their complaint. Defendants have moved to dismiss that complaint. At the time of the settlement, annual sales of ACTOS ® were approximately $3.7 billion and annual sales of ACTO plus Met ® were approximately $500 million. At the time generic competition commenced in August 2012, annual sales of ACTOS ® were approximately $2.8 billion and annual sales of ACTO plus Met ® were approximately $430 million. On September 8, 2014, the FTC sued AbbVie Inc. and certain of its affiliates (“AbbVie”) and Teva in the United States District Court for the Eastern District of Pennsylvania alleging that they violated the antitrust laws when they entered into a settlement agreement to resolve the AndroGel ® patent litigation and a supply agreement under which AbbVie would supply authorized generic product for TriCor ® to Teva. The FTC alleges that Teva agreed to delay the entry of its generic testosterone gel product in exchange for entering into the TriCor supply agreement. On May 6, 2015, the court granted Teva's motion to dismiss the FTC's claim as to Teva. The FTC's motions for reconsideration and for entry of partial final judgment to permit an immediate appeal were denied. Since May 29, 2015, two lawsuits have been filed in the United States District Court for the Southern District of New York by a purported class of direct purchasers of, and a purported class of end payors for, Namenda IR ® (memantine hydrochloride) against Forest Laboratories, LLC and Actavis PLC, the innovator, and several generic manufacturers, including Teva. The direct purchasers withdrew their complaint and filed an amended complaint that did not name Teva as a defendant. Defendants have moved to dismiss the claims made by the end payors. The lawsuits allege, among other things, that the settlement agreements between Forest and the generic manufacturers violated the antitrust laws. Teva entered into its agreement with Forest in November 2009. Annual sales of Namenda IR ® at the time of the settlement were approximately $1.1 billion, and are currently approximately $1.4 billion. 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 specialty pharmaceutical products in the United States. Many of these investigations originate through what are known as qui tam complaints, in which the government reviews a complaint filed under seal by a whistleblower (a “relator”) that alleges violations of the federal False Claims Act. The government considers whether to investigate the allegations and will, in many cases, issue subpoenas requesting documents and other information, including conducting witness interviews. The government must decide whether to intervene and pursue the claims as the plaintiff. Once a decision is made by the government, the complaint is unsealed. If the government decides not to intervene, then the relator may decide to pursue the lawsuit on his own without the active participation of the government. Under the federal False Claims Act, the government (or relators who pursue the claims without the participation of the government in the case) may seek to recover up to three times the amount of damages in addition to a civil penalty of $5,500 to $11,000 for each allegedly false claim submitted to the government for payment. Generally speaking, these cases take several years for the investigation to be completed and, ultimately, to be resolved (either through litigation or settlement) after the complaint is unsealed. In addition, some states have pursued investigations under state false claims statutes or consumer protection laws, either in conjunction with a government investigation or separately. There is often collateral litigation that arises from public disclosures of government investigations, including the filing of class action lawsuits by third party payors alleging fraud-based claims or by shareholders alleging violations of the securities laws. A number of state attorneys general and others have filed various actions against Teva and/or certain of its subsidiaries in the United States relating to reimbursements or drug price reporting under Medicaid or other programs. Such price reporting is alleged to have caused governments and others to pay inflated reimbursements for covered drugs. Teva and its subsidiaries have reached settlements in most of these cases, and remain parties to litigation in Illinois. A provision for the cases has been included in the financial statements. Trial in the Illinois case, on liability only, concluded in the fourth quarter of 2013, and post-trial briefing has been submitted and is under consideration. The State of Illinois is seeking approximately $100 million in compensatory damages. Any such damages ultimately awarded by the court (which would be determined through a separate trial) are subject to automatic trebling. In addition, the state is seeking unspecified statutory penalties that could range, depending on the method used for calculation, from a de minimis amount to well over $100 million. Teva denies any liability, and will argue that even if the court finds liability, compensatory damages and penalties should be significantly less than the amount sought by the state. 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 a |
EQUITY
EQUITY | 12 Months Ended |
Dec. 31, 2015 | |
Equity [Abstract] | |
Equity | Status of options <> A summary of the status of the options as of December 31, 2015, 2014 and 2013, and changes during the years ended on those dates, is presented below (the number of options represents ordinary shares exercis able in respect thereof). Year ended December 31, 2015 2014 2013 Number
(in thousands) Weighted average exercise price Number
(in thousands) Weighted average exercise price Number
(in thousands) Weighted average exercise price Balance outstanding at beginning of year 26,733 $ 45.91 32,481 $ 45.05 36,580 $ 44.40 Changes during the year: Granted 7,655 59.82 6,935 48.60 1,701 38.37 Exercised (8,127) 46.88 (11,423) 45.05 (2,797) 32.17 Forfeited (1,028) 48.96 (1,260) 46.11 (3,003) 45.51 Balance outstanding at end of year 25,233 49.69 26,733 45.91 32,481 45.05 Balance exercisable at end of year 11,299 44.67 12,632 47.16 17,082 47.30 The weighted average fair value of options granted during the years was estimated by using the Black-Scholes option-pricing model as follows: Year ended December 31, 2015 2014 2013 Weighted average fair value $ 10.9 $ 9.3 $ 6.6 The fair value of these options was estimated on the date of grant, based on the following weighted average assumptions: Year ended December 31, 2015 2014 2013 Dividend yield 2.3% 2.9% 3.3% Expected volatility 24% 25% 23% Risk-free interest rate 1.8% 1.9% 2.1% Expected term 5 years 6 years 9 years The expected term was estimated based on the weighted average period 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 information at December 31, 2015 regarding the number of ordinary shares issuable upon (1) outstanding options and (2) vested options: (1) Number of ordinary shares issuable upon exercise of outstanding options Range of exercise prices Balance at end of period (in thousands) Weighted average exercise price Weighted average remaining life Aggregate intrinsic value (in thousands) Number of shares $ Years $ $35.11 - $40.10 3,398 38.61 7.10 91,858 $40.11 - $45.10 4,707 41.93 6.09 111,613 $45.11 - $50.10 7,533 48.55 7.33 128,738 $50.11 - $55.10 1,881 52.18 2.20 25,323 $55.11 - $60.10 1,434 57.85 8.22 11,173 $60.11 - $66.00 6,280 60.27 9.14 33,715 Total 25,233 49.69 7.19 402,420 (2) Number of ordinary shares issuable upon exercise of vested options Range of exercise prices Balance at end of period (in thousands) Weighted average exercise price Weighted average remaining life Aggregate intrinsic value (in thousands) Number of shares $ Years $ $35.11 - $40.10 2,741 38.74 7.02 73,742 $40.11 - $45.10 3,830 41.83 5.87 91,203 $45.11 - $50.10 2,732 48.42 5.97 47,054 $50.11 - $55.10 1,747 52.12 1.72 23,616 $55.11 - $60.10 189 59.58 1.67 1,147 $60.11 - $66.00 60 63.32 1.27 136 Total 11,299 44.67 5.44 236,898 <> The aggregate intrinsic value in the above tables represents the total pre-tax intrinsic value, based on the Company's closing stock price of $65.64 on December 31, 2015, less the weighted average exercise price in each range. This represents the potential amount receivable by the option holders had all option holders exercised their options as of such date. The total number of in-the-money options exercisable as of December 31, 2015 was 11 million. <> The total intrinsic value of options exercised during the years ended December 31, 2015, 2014 and 2013 was $120 million, $74 million and $19 million, respectively, based on the Company's average stock price of $61.66, $51.57 and $38.99 during the years then ended, respectively . <> Status of non-vested RSUs <> 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 , 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, 2015 2014 2013 Number
(in thousands) Weighted average grant date fair value Number
(in thousands) Weighted average grant date fair value Number
(in thousands) Weighted average grant date fair value Balance outstanding at beginning of year 2,466 $43.05 2,512 $40.48 3,744 $41.04 Granted 1,519 56.75 1,342 46.09 289 35.80 Vested (1,112) 41.04 (1,146) 41.55 (1,222) 41.04 Forfeited (322) 48.27 (242) 40.05 (299) 40.98 Balance outstanding at end of year 2,551 51.43 2,466 43.05 2,512 40.48 <> The Company has expensed compensation costs , net of estimated forfeitures, based on the grant-date fair value. For the years ended December 31, 2015 , 2014 and 2013 , the Company recorded stock-based compensation costs as follows: Year ended December 31, 2015 2014 2013 (U.S. $ in millions) Employee stock options $ 62 $ 47 $ 40 RSUs and PSUs 55 38 24 Total stock-based compensation expense 117 85 64 Tax effect on stock-based compensation expense 19 14 14 Net effect $ 98 $ 71 $ 50 <> The total unrecognized compensation cost before tax on employee stock options and RSU /PSUs amounted to $98 million and $96 million, respectively, at December 31, 2015 , and is expected to be recognized over a weighted average period of approximately 1.4 year s. <> d . Dividends and accumulated other comprehensive income (loss): <><>< <><><>Divid Commencing in April 2015 , d ividends on our ordinary shares were declared in U.S. dollars . Dividends paid per share in the years ended December 31, 2015, 2014 and 2013 were $1.36 , $1.34 and $1.28, respectively. Subsequent to December 31, 2015, the Company declared an additional dividend o f $0.34 per share in respect of the fourth quarter of 2015. The components of accumulated other comprehensive loss attributable to Teva are presented in the table below: <><><> December 31, 2015 2014 2013 (U.S. $ in millions) Currency translation adjustment $ (2,384) $ (1,283) $ 151 Unrealized loss on defined benefit plans, net (58) (93) (50) Unrealized gain (loss) on derivative financial instruments, net 175 40 (197) Unrealized gain (loss) from available-for-sale securities, net 312 (7) 5 Accumulated other comprehensive loss attributable to Teva $ (1,955) $ (1,343) $ (91) The following tables present the changes in the components of accumulated other comprehensive loss attributable to Teva for the years ended December 31, 2015, 2014 and 2013: Year ended December 31, 2015 Components of accumulated other comprehensive loss Description of the reclassification to the statement of income Other comprehensive income (loss) before reclassifications Amounts reclassified to the statement of income Net other comprehensive income (loss) before tax Corresponding income tax Net other comprehensive income (loss) after tax (U.S.$ in millions) Currency translation adjustment Currency translation adjustment, reclassified to share in (income) losses of associated companies – net $ (1,131) $ 24 $ (1,107) $ 6 $ (1,101) Unrealized gain (loss) from available-for-sale securities Loss on marketable securities* (413) 737 324 (5) 319 Unrealized gain (loss) from derivative financial instruments Gain on derivative financial instruments** 137 (2) 135 - 135 Unrealized gain (loss) on defined benefit plans Gain on defined benefit plans, reclassified to various statement of income items*** 33 4 37 (2) 35 Total accumulated other comprehensive income (loss) $ (1,374) $ 763 $ (611) $ (1) $ (612) Year ended December 31, 2014 Components of accumulated other comprehensive loss Description of the reclassification to the statement of income Other comprehensive income (loss) before reclassifications Amounts reclassified to the statement of income Net other comprehensive income (loss) before tax Corresponding income tax Net other comprehensive income (loss) after tax (U.S.$ in millions) Currency translation adjustment Currency translation adjustment, reclassified to financial expenses - net $ (1,429) $ (5) $ (1,434) $ - $ (1,434) Unrealized gain (loss) from available-for-sale securities Gain on marketable securities, reclassified to financial expenses - net (12) 2 (10) (2) (12) Unrealized gain (loss) from derivative financial instruments Loss on derivative financial instruments, reclassified to net revenues 240 (3) 237 - 237 Unrealized gain (loss) on defined benefit plans Loss on defined benefit plans, reclassified to various statement of income items*** (55) (2) (57) 14 (43) Total accumulated other comprehensive income (loss) $ (1,256) $ (8) $ (1,264) $ 12 $ (1,252) Year ended December 31, 2013 Components of accumulated other comprehensive loss Description of the reclassification to the statement of income Other comprehensive income (loss) before reclassifications Amounts reclassified to the statement of income Net other comprehensive income (loss) before tax Corresponding income tax Net other comprehensive income (loss) after tax (U.S.$ in millions) Currency translation adjustment Currency translation adjustment, reclassified to financial expenses - net $ (46) $ 17 $ (29) $ 5 $ (24) Unrealized gain (loss) from available-for-sale securities Gain on marketable securities, reclassified to financial expenses - net 18 (6) 12 - 12 Unrealized gain (loss) from derivative financial instruments Loss on derivative financial instruments, reclassified to net revenues (111) 7 (104) - (104) Unrealized gain (loss) on defined benefit plans Loss on defined benefit plans, reclassified to various statement of income items*** 20 24 44 (2) 42 Total accumulated other comprehensive income (loss) $ (119) $ 42 $ (77) $ 3 $ (74) * $632 million loss reclassified to financial expenses—net and $105 million loss reclassified to impairments, restructuring and others. ** $26 million loss reclassified to financial expenses—net and $28 million gain reclassified to net revenues.
*** Affected cost of sales, research and development expenses, selling and marketing expenses and general and administrative expenses. " id="sjs-B4" xml:space="preserve"><> NOTE 1 4 —EQUITY: <> aaa. amauhfadhfbjkwasdbfjkasdbjkf,.xd.d..dA.a.`` aa Ordinary shares and ADSs <> As of December 31, 2015 , there were 1 b illio n ordinary shares issued (December 31, 2014 — 957 million). Teva ordinary shares are traded on the T el-Aviv Stock Exchange and, in the form of American Deposit a ry Shares, each of which represents one ordinary share, on the New York Stock Exchange in the United States. On December 8, 2015, the Company completed an offering of 54 million ADSs at $62.50 per share. The net proceeds from the offering of $3.3 billion, together with the net proceeds of $3.3 billion from the mandatory convertible preferred shares offering referred to below, will be used to finance a portion of the cash consideration payable in connection with the Actavis Generics acquisition and related fees and expenses, to finance the pending Rimsa acquisition or otherwise for general corporate purposes. On January 6, 2016, Teva sold an additional 5.4 million ADSs , pursuant to the underwriters' exercise in full of their overallotment option . As a result, Teva received an additional $329 million in net proceeds, for an aggregate of approximately $3.62 billion including the initial closing. <> bb נ b Mandato ry convertible preferred shares Also, on December 8, 2015, the Company completed an offering of 3,375,000 of its 7% mandatory convertible preferred shares. The mandatory convertible preferred shares have no voting rights and rank senior to Teva's ordinary shares with respect to dividends and distributions upon our liquidation, winding-up or dissolution . Dividends on the mandatory convertible preferred shares are payable on a cumulative basis when, as and if declared by Teva's board of directors at an annual rate of 7% on the liquidation preference of $1,000.00 per mandatory convertible preferred share. Declared dividends will be paid in cash on March 15, June 15, September 15 and December 15 of each year commencing March 15, 2016, through and including December 15, 2018. Dividends accumulate from the most recent date as to which dividends shall have been paid or, if no dividends have been paid, from the first original issue date and, to the extent legally permitted and declared by the board of directors, such dividend will be paid in cash on each dividend payment date; provided that any undeclared or unpaid dividends will continue to accumulate. So long as any m andatory c onvertible p referred s hare remains outstanding, no dividend or distribution shall be declared or paid on Teva's ordinary shares, ADSs or any other class or series of junior shares, and none of Teva's ordinary shares, ADSs or any other class or series of junior shares shall be purchased, redeemed or otherwise acquired for consideration by us or any of Teva's subsidiaries unless all accumulated and unpaid dividends for all preceding dividend periods have been declared and paid upon, or a sufficient sum of cash has been set apart for the payment of such dividends upon, all outstanding m andatory c onvertible p referred s hares. Each mandatory convertible preferred share will automatically convert on December 15, 2018 ( the " mandatory conversion date") into between 13.3 and 16.0 ADSs, subject to anti-dilution adjustments. The number of ADSs issuable upon conversion of the mandatory convertible preferred shares will be determined based on the volume weighted average price per ADS over the 20 consecutive trading day period beginning on and including the 22nd scheduled trading day immediately preceding the mandatory conversion date. At any time prior to the mandatory conversion date, other than during a fundamental change conversion period as defined, holders of the mandatory convertible preferred shares may elect to convert each mandatory convertible preferred share into ADSs at the minimum conversion rate of 13.3 ADSs per mandatory convertible preferred share, subject to anti-dilution adjustments. In addition, holders may elect to convert their mandatory convertible preferred shares during a specified period beginning on the fundamental change effective date, in which case such mandatory convertible preferred shares will be converted into ADSs at the fundamental change conversion rate and converting holders will also be entitled to receive a fundamental change dividend make-whole amount and any accumulated but unpaid dividends. As of December 31, 2015, the accrued dividends payable on the mandatory convertible preferred shares amounted to $15 million. On January 6, 2016, Teva sold an additional 337,500 mandatory convertible preferred shares pursuant to the underwriters exercise in full of their overallotment option. As a result, Teva received an additional $329 million in net proceeds, for an aggregate of approximately $3.62 billion including the initial closing. These additional 337,500 mandatory convertible preferred shares accumulated dividends from December 8, 2015. Share repurchase program In October 201 4 , Teva's board of directors authorized the Company to increase its share repurchase program up to $3 billion of its ordinary shares and ADS s . A s of December 31, 2015 , $2.1 billion rem ain available for repur chases. This repurchase authorization has no time limit. Repurchases may be commenced or suspended at any time or from time to time. The following table summarizes the shares repurchased and the amount Teva spent on these repurchases: Year ended December 31, 2015 2014 2013 (in millions) Amount spent on shares repurchased $ 439 $ 500 $ 497 Number of shares repurchased 7.7 8.7 12.8 c . Stock-based compensation plans: Stock-based compensation plans are comprised of employee stock option plans, 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 the 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 . At the date of it s expiration, there remained 12. 2 million shares available for grant as options (or option equivalents). On September 3, 2015, the Teva 2015 Long-Term Equity-Based Incentive Plan was approved by the shareholders, under which 43.7 million equivalent share units, including options exercisable into ordinary shares, RSUs and PSUs, were approved for grant. As of December 31, 2015, 43.4 million equivalent share units remained 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, 2015, 2014 and 2013, and changes during the years ended on those dates, is presented below (the number of options represents ordinary shares exercis able in respect thereof). Year ended December 31, 2015 2014 2013 Number (in thousands) Weighted average exercise price Number (in thousands) Weighted average exercise price Number (in thousands) Weighted average exercise price Balance outstanding at beginning of year 26,733 $ 45.91 32,481 $ 45.05 36,580 $ 44.40 Changes during the year: Granted 7,655 59.82 6,935 48.60 1,701 38.37 Exercised (8,127) 46.88 (11,423) 45.05 (2,797) 32.17 Forfeited (1,028) 48.96 (1,260) 46.11 (3,003) 45.51 Balance outstanding at end of year 25,233 49.69 26,733 45.91 32,481 45.05 Balance exercisable at end of year 11,299 44.67 12,632 47.16 17,082 47.30 The weighted average fair value of options granted during the years was estimated by using the Black-Scholes option-pricing model as follows: Year ended December 31, 2015 2014 2013 Weighted average fair value $ 10.9 $ 9.3 $ 6.6 The fair value of these options was estimated on the date of grant, based on the following weighted average assumptions: Year ended December 31, 2015 2014 2013 Dividend yield 2.3% 2.9% 3.3% Expected volatility 24% 25% 23% Risk-free interest rate 1.8% 1.9% 2.1% Expected term 5 years 6 years 9 years The expected term was estimated based on the weighted average period 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 information at December 31, 2015 regarding the number of ordinary shares issuable upon (1) outstanding options and (2) vested options: (1) Number of ordinary shares issuable upon exercise of outstanding options Range of exercise prices Balance at end of period (in thousands) Weighted average exercise price Weighted average remaining life Aggregate intrinsic value (in thousands) Number of shares $ Years $ $35.11 - $40.10 3,398 38.61 7.10 91,858 $40.11 - $45.10 4,707 41.93 6.09 111,613 $45.11 - $50.10 7,533 48.55 7.33 128,738 $50.11 - $55.10 1,881 52.18 2.20 25,323 $55.11 - $60.10 1,434 57.85 8.22 11,173 $60.11 - $66.00 6,280 60.27 9.14 33,715 Total 25,233 49.69 7.19 402,420 (2) Number of ordinary shares issuable upon exercise of vested options Range of exercise prices Balance at end of period (in thousands) Weighted average exercise price Weighted average remaining life Aggregate intrinsic value (in thousands) Number of shares $ Years $ $35.11 - $40.10 2,741 38.74 7.02 73,742 $40.11 - $45.10 3,830 41.83 5.87 91,203 $45.11 - $50.10 2,732 48.42 5.97 47,054 $50.11 - $55.10 1,747 52.12 1.72 23,616 $55.11 - $60.10 189 59.58 1.67 1,147 $60.11 - $66.00 60 63.32 1.27 136 Total 11,299 44.67 5.44 236,898 <> The aggregate intrinsic value in the above tables represents the total pre-tax intrinsic value, based on the Company's closing stock price of $65.64 on December 31, 2015, less the weighted average exercise price in each range. This represents the potential amount receivable by the option holders had all option holders exercised their options as of such date. The total number of in-the-money options exercisable as of December 31, 2015 was 11 million. <> The total intrinsic value of options exercised during the years ended December 31, 2015, 2014 and 2013 was $120 million, $74 million and $19 million, respectively, based on the Company's average stock price of $61.66, $51.57 and $38.99 during the years then ended, respectively . <> Status of non-vested RSUs <> 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 , 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, 2015 2014 2013 Number (in thousands) Weighted average grant date fair value Number (in thousands) Weighted average grant date fair value Number (in thousands) Weighted average grant date fair value Balance outstanding at beginning of year 2,466 $43.05 2,512 $40.48 3,744 $41.04 Granted 1,519 56.75 1,342 46.09 289 35.80 Vested (1,112) 41.04 (1,146) 41.55 (1,222) 41.04 Forfeited (322) 48.27 (242) 40.05 (299) 40.98 Balance outstanding at end of year 2,551 51.43 2,466 43.05 2,512 40.48 <> The Company has expensed compensation costs , net of estimated forfeitures, based on the grant-date fair value. For the years ended December 31, 2015 , 2014 and 2013 , the Company recorded stock-based compensation costs as follows: Year ended December 31, 2015 2014 2013 (U.S. $ in millions) Employee stock options $ 62 $ 47 $ 40 RSUs and PSUs 55 38 24 Total stock-based compensation expense 117 85 64 Tax effect on stock-based compensation expense 19 14 14 Net effect $ 98 $ 71 $ 50 <> The total unrecognized compensation cost before tax on employee stock options and RSU /PSUs amounted to $98 million and $96 million, respectively, at December 31, 2015 , and is expected to be recognized over a weighted average period of approximately 1.4 year s. <> d . Dividends and accumulated other comprehensive income (loss): <><>< <><><>Divid Commencing in April 2015 , d ividends on our ordinary shares were declared in U.S. dollars . Dividends paid per share in the years ended December 31, 2015, 2014 and 2013 were $1.36 , $1.34 and $1.28, respectively. Subsequent to December 31, 2015, the Company declared an additional dividend o f $0.34 per share in respect of the fourth quarter of 2015. The components of accumulated other comprehensive loss attributable to Teva are presented in the table below: <><><> December 31, 2015 2014 2013 (U.S. $ in millions) Currency translation adjustment $ (2,384) $ (1,283) $ 151 Unrealized loss on defined benefit plans, net (58) (93) (50) Unrealized gain (loss) on derivative financial instruments, net 175 40 (197) Unrealized gain (loss) from available-for-sale securities, net 312 (7) 5 Accumulated other comprehensive loss attributable to Teva $ (1,955) $ (1,343) $ (91) The following tables present the changes in the components of accumulated other comprehensive loss attributable to Teva for the years ended December 31, 2015, 2014 and 2013: Year ended December 31, 2015 Components of accumulated other comprehensive loss Description of the reclassification to the statement of income Other comprehensive income (loss) before reclassifications Amounts reclassified to the statement of income Net other comprehensive income (loss) before tax Corresponding income tax Net other comprehensive income (loss) after tax (U.S.$ in millions) Currency translation adjustment Currency translation adjustment, reclassified to share in (income) losses of associated companies – net $ (1,131) $ 24 $ (1,107) $ 6 $ (1,101) Unrealized gain (loss) from available-for-sale securities Loss on marketable securities* (413) 737 324 (5) 319 Unrealized gain (loss) from derivative financial instruments Gain on derivative financial instruments** 137 (2) 135 - 135 Unrealized gain (loss) on defined benefit plans Gain on defined benefit plans, reclassified to various statement of income items*** 33 4 37 (2) 35 Total accumulated other comprehensive income (loss) $ (1,374) $ 763 $ (611) $ (1) $ (612) Year ended December 31, 2014 Components of accumulated other comprehensive loss Description of the reclassification to the statement of income Other comprehensive income (loss) before reclassifications Amounts reclassified to the statement of income Net other comprehensive income (loss) before tax Corresponding income tax Net other comprehensive income (loss) after tax (U.S.$ in millions) Currency translation adjustment Currency translation adjustment, reclassified to financial expenses - net $ (1,429) $ (5) $ (1,434) $ - $ (1,434) Unrealized gain (loss) from available-for-sale securities Gain on marketable securities, reclassified to financial expenses - net (12) 2 (10) (2) (12) Unrealized gain (loss) from derivative financial instruments Loss on derivative financial instruments, reclassified to net revenues 240 (3) 237 - 237 Unrealized gain (loss) on defined benefit plans Loss on defined benefit plans, reclassified to various statement of income items*** (55) (2) (57) 14 (43) Total accumulated other comprehensive income (loss) $ (1,256) $ (8) $ (1,264) $ 12 $ (1,252) Year ended December 31, 2013 Components of accumulated other comprehensive loss Description of the reclassification to the statement of income Other comprehensive income (loss) before reclassifications Amounts reclassified to the statement of income Net other comprehensive income (loss) before tax Corresponding income tax Net other comprehensive income (loss) after tax (U.S.$ in millions) Currency translation adjustment Currency translation adjustment, reclassified to financial expenses - net $ (46) $ 17 $ (29) $ 5 $ (24) Unrealized gain (loss) from available-for-sale securities Gain on marketable securities, reclassified to financial expenses - net 18 (6) 12 - 12 Unrealized gain (loss) from derivative financial instruments Loss on derivative financial instruments, reclassified to net revenues (111) 7 (104) - (104) Unrealized gain (loss) on defined benefit plans Loss on defined benefit plans, reclassified to various statement of income items*** 20 24 44 (2) 42 Total accumulated other comprehensive income (loss) $ (119) $ 42 $ (77) $ 3 $ (74) * $632 million loss reclassified to financial expenses—net and $105 million loss reclassified to impairments, restructuring and others. ** $26 million loss reclassified to financial expenses—net and $28 million gain reclassified to net revenues. *** Affected cost of sales, research and development expenses, selling and marketing expenses and general and administrative expenses. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2015 | |
Income Taxes [Absract] | |
Income Taxes | ost of the Parent Company's industrial projects and those of several of its Israeli subsidiaries have been granted “Approved Enterprise” status under the Israeli Law for the Encouragement of Capital Investments ("Investment Law") . For the vast majority of such Approved Enterprises, the companies elected to apply for alternative tax benefits – i.e., the waiver of government grants in return for tax exemptions on undistributed income. Upon distribution of such exempt income, the distributing company will be subject to corporate tax at the rate ordinarily applicable to the Approved Enterprise's income. Such tax exemption on undistributed income appl ies for a limited period of between two to ten years, depending upon the location of the enterprise. During the remainder of the benefits period (generally until the expiration of ten years), a corporate tax rate not exceeding 25% is appl ied . One Approved Enterprise of an Israeli subsidiary enjoy ed special benefits under the "Strategic Investment Track" ; income accrued under this track during the benefits period was exempt from tax, and dividends distributed from such income are also exempt from Israeli tax. Teva is a F oreign I nvestors C ompany, or FIC, as defined by the Israeli Investment Law. Under the incentives regime that applied to Teva until 2013, FICs were entitled to further reductions in the tax rate normally applicable to Approved Enterprises . Depend ing on the level of foreign ownership in each tax year, the tax rate range d between 10% (when foreign ownership exceed ed 90 %) to 25% (when the foreign ownership was below 49%). Pursuant to Amendment 69 to the Israeli Investment Law (" Amendment 69 " ), a company that elected by November 11, 2013 to pay a reduced 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 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. A company that has elected to apply the amendment cannot withdraw from its election . During 2013, Teva applied the provisions of Amendment 69 to certain exempt profits accrued prior to 2012 by Teva and one of its Israeli subsidiaries. Consequently, the Company paid $ 577 million corporate tax on exempt income of $9.4 billion. Part of this income was distributed as dividends during 2013, while the remainder is available to be distributed as dividends in future years with no additional corporate tax liability. As a result, Teva wa s required to invest $ 286 million in its industrial enterprises in Israel over a five year period. Such investment may be in the form of the acquisition of industrial assets (excluding real estate assets), investment in R&D in Israel, or payroll payments to new employees to be hired by the enterprise. Teva already fully invested the required amount in 2013. The amount of tax- exempt profit s earned by the Company from Approved Enterprises through December 31, 2013 that were not released under Amendment 69 is approximately $ 9.7 b illion, and the tax that would have been payable had the Company distributed dividends out of that income is approximately $ 1.5 b illion. However, deferred taxes have not been provided for such tax-exempt income, as the Company intends to permanently reinvest these profits and does not currently foresee a need to distribute dividends out of these earnings (see n ote 1 p ). Likewise, the Company intends to reinvest , rather than distribute , the income of its foreign subsidiaries. An assessment of the tax that would have been payable had the Company's foreign subsidiaries distributed their income to the Company is not practicable because of the multiple levels of corporate ownership and multiple tax jurisdictions involved in each hypo thetical dividend distribution. Income not eligible for Preferred E nterprise benefits is taxed at a regular rate , which was 26.5 % in 2015 . In January 2016, the regular tax rate in Israel was reduced to 25% from 2016 and thereafter. 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 reduce s the effect of U.S. dollar – NIS exchange rate on the Company's Israeli taxable income. <> Non-Israeli subsidiaries are taxed according to the tax laws in their respective country of residence. Certain manufacturing subsidiaries operate in several jurisdictions outside Israel , some of which benefit from tax incentives such as reduced tax rates, investment tax credits and accelerated deductions. " id="sjs-B4" xml:space="preserve">NOTE 15—INCOME TAXES: a. Income before income taxes: Year ended December 31, 2015 2014 2013 (U.S. $ in millions) Parent Company and its Israeli subsidiaries $ 1,932 $ 2,139 $ 1,303 Non-Israeli subsidiaries 420 1,499 (53) $ 2,352 $ 3,638 $ 1,250 b. Income taxes: Year ended December 31, 2015 2014 2013 (U.S. $ in millions) In Israel $ 149 $ 147 $ 197 Outside Israel 485 444 (240) $ 634 $ 591 $ (43) Current $ 298 $ 879 $ 1,096 Deferred 336 (288) (1,139) $ 634 $ 591 $ (43) Year ended December 31, 2015 2014 2013 (U.S. $ in millions) Income before income taxes $ 2,352 $ 3,638 $ 1,250 Statutory tax rate in Israel 26.5% 26.5% 25% Theoretical provision for income taxes $ 623 $ 964 $ 313 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 (337) (524) (535) Amendment 69 payments and finalization of prior years' tax audits, net of decrease of related uncertain tax positions - - 248 Non-Israeli subsidiaries 447 88 (275) Increase (decrease) in other uncertain tax positions—net (99) 63 206 Effective consolidated income taxes $ 634 $ 591 $ (43) 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 subsidiaries that have tax rates above Teva's average tax rates , the impact of impairment, restructuring and legal settlement charges and adjustments to valuation allowances on deferred tax assets on such subsidiaries . c. Deferred income taxes: December 31, 2015 2014 (U.S. $ in millions) Short-term deferred tax assets—net: Inventory related $ 382 $ 383 Sales reserves and allowances 254 357 Provision for legal settlements 89 229 Provisions for employee-related obligations 45 66 Carryforward losses and deductions (*) 60 59 Other 64 78 894 1,172 Valuation allowance—in respect of carryforward losses and deductions that may not be utilized (190) (213) $ 704 $ 959 * The amounts are shown after reduction for unrecognized tax benefits of $108 million and $143 million, at December 31, 2015 and 2014, respectively, where Teva has net operating loss carryforwards, similar tax losses, and/or tax credit carryforwards that are available, under the tax law of the applicable jurisdiction, to offset any additional income taxes that would result from the settlement of a tax position. December 31, 2015 2014 Long-term deferred tax assets (liabilities)—net: (U.S. $ in millions) Intangible assets $ (1,900) $ (1,098) Carryforward losses and deductions(*)(**) 989 1,043 Property, plant and equipment (207) (218) Provisions for employee related obligations 65 39 Other 125 (21) (928) (255) Valuation allowance—in respect of carryforward losses and deductions that may not be utilized (570) (458) $ (1,498) $ (713) $ (794) $ 246 * The amounts are shown after reduction for unrecognized tax benefits of $70 million and $150 million as of December 31, 2015 and 2014, respectively. ** This amount represents the tax effect of gross carryforward losses and deductions with the following expirations: 2017-2018 — $47 million; 2019-2025 — $334 million; 2026 and thereafter — $205 million. The remaining balance—$473 million—can be utilized with no expiration date. The deferred income taxes are reflected in the balance sheets among: December 31, 2015 2014 (U.S. $ in millions) Current assets—deferred income taxes $ 735 $ 993 Current liabilities—other current liabilities (31) (34) Other non-current assets 250 388 Long-term liabilities—deferred income taxes (1,748) (1,101) $ (794) $ 246 Deferred taxes have not been provided for tax-exempt profits earned by the Company from Approved Enterprises through December 31, 2013 (except to the extent released due to payments made in 2013 under Amendment 69 of the Investment Law, as described below) , as the Company intends to permanently reinvest these profits and does not currently foresee a need to distribute dividends out of these earnings. For the same reason, deferred taxes have not been provided for distributions of income from the Company's fo reign subsidiaries. See n ote 1 5f . d . Uncertain tax positions: <> The following table summarizes the activity of Teva's gross unrecognized tax benefits: Year ended December 31, 2015 2014 2013 (U.S. $ in millions) Balance at the beginning of the year $ 713 $ 665 $ 903 Increase (decrease) related to prior year tax positions, net (6) 38 29 Increase related to current year tax positions 43 51 176 Decrease related to settlements with tax authorities and lapse of applicable statutes of limitations (99) (38) (461) Other (3) (3) 18 Balance at the end of the year $ 648 $ 713 $ 665 Uncertain tax positions, mainly of a long-term nature, included accrued potential penalties and interest of $101 million, $87 million and $75 million as of December 31, 2015, 2014 and 2013, respecti vely. The total amount of interest and penalties reflected in the consolidated statements of income was a net increase of $14 million for the year ended December 31, 2015 , a net increase of $12 million for the year ended December 31, 2014 and a net release of $69 million for the year ended December 31, 2013. Substantially all the above uncertain tax benefits, if recognized, would reduce Teva's annual effective tax rate. Teva does not expect uncertain t ax positions to change significantly over the next 12 months, except in the case of settlements with tax authorities, the likelihood and timing of which is difficult to estimate. e <> e e . Tax assessments: <> Teva file s income tax returns in various jurisdictions with varying statutes of limitations. The Parent Company and its subsidiaries in Israel have received final tax assessments through tax year 200 7 . In 2013, Teva settled the 200 5 -2007 income tax as sessment with the Israeli tax authorities, paying $ 213 million . No further taxes are due in relation to these years. Certain guidelines which were set pursuant to the agreement reached in relation to the 2005-2007 assessment have be en implemented in the audit of tax years 2008-2011, and are reflected in the provisions. Following the audit of Teva's 2008 Israeli corporate tax returns, the Israeli tax authorities issued a tax assessmen t decree for 2008-2010 and a tax assessment for 2011 , challe nging the Company's positions on several issues. Teva has protested the assessment. 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. The Company's subsidiaries in North America and Europe have received final tax assessments mainly through tax year 2005 and 2008, respectively. f . Basis of taxation: <> The Company and its subsidiaries are subject to tax in many jurisdictions , and a certain degree of 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. Under A mendment 68 to the Israeli Investment Law ("Amendment 68") , which Teva started applying in 2014, upon an irrevocable election made by a c ompany, a uniform corporate tax rate will apply to all qualifying industrial income of such c ompan y (" Preferred Enterprise ") , as opposed to the prev ious law's incentives, which were limited to income from Approved Enterprises during their benefits period. Under the law, when the election is made, the uniform tax rate (for 2014 and on) will be 9% in areas in Israel designated as Development Zone A and 16% elsewhere in Israel . The profits of these Preferred Enterprise will be freely distributable as dividends, subject to a withholding tax of 20% or lower, under an applicable tax treaty. “Special Industrial Companies” 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 Industrial Company," the approval of three governmental authorities in Israel is required. Teva is currently examining its eligibility to be regarded as a "Special Industrial Company" under the new law. Under the incentive regime that applied to Teva until 2013, m <> ost of the Parent Company's industrial projects and those of several of its Israeli subsidiaries have been granted “Approved Enterprise” status under the Israeli Law for the Encouragement of Capital Investments ("Investment Law") . For the vast majority of such Approved Enterprises, the companies elected to apply for alternative tax benefits – i.e., the waiver of government grants in return for tax exemptions on undistributed income. Upon distribution of such exempt income, the distributing company will be subject to corporate tax at the rate ordinarily applicable to the Approved Enterprise's income. Such tax exemption on undistributed income appl ies for a limited period of between two to ten years, depending upon the location of the enterprise. During the remainder of the benefits period (generally until the expiration of ten years), a corporate tax rate not exceeding 25% is appl ied . One Approved Enterprise of an Israeli subsidiary enjoy ed special benefits under the "Strategic Investment Track" ; income accrued under this track during the benefits period was exempt from tax, and dividends distributed from such income are also exempt from Israeli tax. Teva is a F oreign I nvestors C ompany, or FIC, as defined by the Israeli Investment Law. Under the incentives regime that applied to Teva until 2013, FICs were entitled to further reductions in the tax rate normally applicable to Approved Enterprises . Depend ing on the level of foreign ownership in each tax year, the tax rate range d between 10% (when foreign ownership exceed ed 90 %) to 25% (when the foreign ownership was below 49%). Pursuant to Amendment 69 to the Israeli Investment Law (" Amendment 69 " ), a company that elected by November 11, 2013 to pay a reduced 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 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. A company that has elected to apply the amendment cannot withdraw from its election . During 2013, Teva applied the provisions of Amendment 69 to certain exempt profits accrued prior to 2012 by Teva and one of its Israeli subsidiaries. Consequently, the Company paid $ 577 million corporate tax on exempt income of $9.4 billion. Part of this income was distributed as dividends during 2013, while the remainder is available to be distributed as dividends in future years with no additional corporate tax liability. As a result, Teva wa s required to invest $ 286 million in its industrial enterprises in Israel over a five year period. Such investment may be in the form of the acquisition of industrial assets (excluding real estate assets), investment in R&D in Israel, or payroll payments to new employees to be hired by the enterprise. Teva already fully invested the required amount in 2013. The amount of tax- exempt profit s earned by the Company from Approved Enterprises through December 31, 2013 that were not released under Amendment 69 is approximately $ 9.7 b illion, and the tax that would have been payable had the Company distributed dividends out of that income is approximately $ 1.5 b illion. However, deferred taxes have not been provided for such tax-exempt income, as the Company intends to permanently reinvest these profits and does not currently foresee a need to distribute dividends out of these earnings (see n ote 1 p ). Likewise, the Company intends to reinvest , rather than distribute , the income of its foreign subsidiaries. An assessment of the tax that would have been payable had the Company's foreign subsidiaries distributed their income to the Company is not practicable because of the multiple levels of corporate ownership and multiple tax jurisdictions involved in each hypo thetical dividend distribution. Income not eligible for Preferred E nterprise benefits is taxed at a regular rate , which was 26.5 % in 2015 . In January 2016, the regular tax rate in Israel was reduced to 25% from 2016 and thereafter. 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 reduce s the effect of U.S. dollar – NIS exchange rate on the Company's Israeli taxable income. <> Non-Israeli subsidiaries are taxed according to the tax laws in their respective country of residence. Certain manufacturing subsidiaries operate in several jurisdictions outside Israel , some of which benefit from tax incentives such as reduced tax rates, investment tax credits and accelerated deductions. |
DERIVATIVE INSTRUMENTS AND HEDG
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 12 Months Ended |
Dec. 31, 2015 | |
Derivative Instruments and Hedging Activities [Absract] | |
Financial Instruments and Risk Management | <> NOTE 1 6 – D ERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES: <>< Foreign exchange risk management : In 2015, approximately 43% of Teva's revenues came from sales outside of the United States. As a result, Teva is subject to significant foreign currency risks. The Company enters into forward exchange contracts in non-functional currencies and purchases and writes non-functional currency options in order to hedge the currency exposure on identifiable balance sheet items. In addition, the Company takes steps 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 new Israeli shekel (NIS), the euro (EUR), the Swiss franc (CHF), the British pound (GBP), the Hungarian forint (HUF), the Croatian kuna (HRK), other European currencies and Latin American currencies such as the Mexican peso (MXN). The writing of options is part of a comprehensive currency hedging strategy. <> The counterparties to the derivatives are comprise d mainly of major banks and, in light of the current financial environment, the Company is monitoring the associated inherent credit risks. The Company does not enter into derivative transactions for trading purposes . Venezuela has experienced hyper-inflation in recent years and has several official exchange rates, which deviate significantly among themselves as well as from unofficial market rates. In addition, remittance of cash outside of Venezuela is limited. Teva currently prepares its financial statements using the official preferential industry exchange rate of 6.3 bolivars per U.S. dollar. If such exchange rate is no longer able to be used as a result of a devaluation or other changing circumstances, Teva is exposed to a potential loss of its net monetary assets in Venezuela, which, as of December 31, 2015, amounted to approximately $487 million using the official exchange rate. Interest risk management : The Company raises capital through various debt instruments, including straight notes that bear a fixed or variable interest rate, bank lo ans, 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, 2015 2014 (U.S. $ in millions) Forward starting interest rate swap - cash flow hedge $ 3,500 $ - Interest rate swap - fair value hedge 1,294 1,750 Cross-currency swap - cash flow hedge 588 1,875 Treasury lock - cash flow hedge 500 - Forecasted transactions - cash flow hedge - 280 The following table summarizes the classification and fair values of derivative instruments: Fair value Designated as hedging instruments Not designated as hedging instruments December 31, 2015 December 31, 2014 December 31, 2015 December 31, 2014 Reported under (U.S. $ in millions) Asset derivatives: Other current assets: Cross-currency swaps - cash flow hedge $ - $ 14 $ - $ - Forward starting interest rate swaps - cash flow hedge 26 - - - Option and forward contracts -cash flow hedge - 14 - - Option and forward contracts - - 25 68 Other non-current assets: Cross-currency swaps - cash flow hedge 78 6 - - Interest rate swaps - fair value hedge 1 - - - Liability derivatives: Other current liabilities: Forward starting interest rate swaps - cash flow hedge (10) - - - Treasury lock- cash flow hedge (5) - - - Option and forward contracts -cash flow hedge - (1) - - Option and forward contracts - - (11) (53) Senior notes and loans: Interest rate swaps - fair value hedge (11) (43) - - Derivatives on foreign exchange contracts hedge Teva's balance sheet items from currency exposure but are not designated as hedging instruments for accounting purposes. With respect to such derivatives, gains of $26 million , $85 million and $76 million were reco gnized under financial expenses - net for the years ended December 3 1 , 2015 , 2014 and 2013 respectively. Such gains offset the revaluation of the balance sheet items also booked under financial expenses—net. With respect to the interest rate and cross-currency swap agreements, gains of $27 million , $41 million and $35 million were reco gnized under financial expenses - net for the years ended December 31, 2015, 2014 and 2013, respectively . Such gains mainly reflect the differences between the fixed interest rate and the floating interest rate. In connection with the debt tender offer completed in February 2015, Teva terminated certain of its derivati ves designated as hedging instruments and recognized a loss of $36 million under financial expenses-net. See note 11 . In the third and fourth quarters of 2015, Teva entered into forward starting interest rate swap and treasury lock agreements designated as cash flow hedges of future debt issuances, anticipated in connection with the Actavis Generics acquisition , with respect to $3.5 billion and $500 million notional amounts, respectively. These agreements hedge the variability in anticipated future interest payments due to changes in the benchmark interest rate between the date the agreements were entered into and the expected date of future debt issuances in 2016, at which time these agreements are intended to be settled. Upon completion of a debt issuance and settlement of the swap agreements, the change in fair value of these instruments recorded as part of other comprehensive income (loss) will be amortized under financial expenses-net over the life of the debt. In January 2016, Teva entered into additional forward starting interest rate swap and treasury lock agreements, designated as cash flow hedge of the anticipated future debt issuance, with respect to $250 million and $1 billion notional amount s , respectively. d . Securitization : In April 2011, Teva established an accounts receivable securitization program with BNP Paribas Bank. Under the program, Teva sells, on an ongoing basis, certain accounts receivable and the right to the collections on those accounts receivable to BNP Paribas. Once sold to BNP Paribas, the accounts receivable and rights to collection are separate and distinct from Teva's own assets. These assets are unavailable to Teva's creditors should Teva become insolvent. BNP Paribas has all the rights ensuing from the sale of the securitized accounts receivable, including the right to pledge or exchange the assets it received. Consequently, the accounts receivable in Teva's consolidated balance sheets is presented net of the securitized receivables. As of December 31, 2015 and 2014 , the balance of Teva's securitized assets sold amounted to $ 445 million a nd $585 million, respectively. Gains and losses related to these transactions were immaterial for the three years ended December 31, 2015. The following table summarizes the net balance outstanding under the outstanding securitization program : As of and for the year ended December 31, 2015 2014 (U.S. $ in millions) Sold receivables at the beginning of the year $ 585 $ 590 Proceeds from sale of receivables 3,447 4,287 Cash collections (remitted to the owner of the receivables) (3,532) (4,202) Effect of currency exchange rate changes (55) (90) Sold receivables at the end of the year $ 445 $ 585 |
FINANCIAL EXPENSES NET
FINANCIAL EXPENSES NET | 12 Months Ended |
Dec. 31, 2015 | |
Financial Expenses Net [Abstract] | |
Financial Expenses - Net | NOTE 17—FINANCIAL EXPENSES- NET: Year ended December, 31 2015 2014 2013 (U.S. $ in millions) Other-than-temporary impairment of securities $ 631 $ 6 $ - Interest expenses and other bank charges 270 300 314 Income from investments (34) (24) (32) Foreign exchange (gains) losses - net (9) 30 8 Other- mainly debt tender offer and termination of related swap agreements 142 1 109 Total finance expense — net $ 1,000 $ 313 $ 399 |
OTHER EXPENSES
OTHER EXPENSES | 12 Months Ended |
Dec. 31, 2015 | |
Restructuring And Impairment [Abstract] | |
Restructuring And Impairment | NOTE 18—OTHER EXPENSES: a. Impairments, restructuring and others: Impairments, restructuring and others consisted of the following: Year ended December 31, 2015 2014 2013 (U.S. $ in millions) Impairment of long-lived assets (see notes 6 and 8) $ 361 $ 387 $ 524 Contingent consideration (see note 3) 399 (20) 36 Acquisition costs 211 13 27 Restructuring 183 246 201 Other (23) 24 - Total $ 1,131 $ 650 $ 788 Impairments In determining the estimated fair value of the long-lived assets, Teva utilized a discounted cash flow model. The key assumptions within the model related to forecasting future revenue and operating income, an appropriate weighted average cost of capital, 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 other things, the following: ( i ) for research and development in-process 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. Impairment of long-lived assets in 2015 amounted to $361 million, comprised of: Identifiable intangible assets impairments of $265 million were recorded, comprised of impairment of $133 million , following a decrease in sales projections of Synribo ® , and other p roduct rights impairments of $13 2 million due to current market conditions and supply chain challenges in various Teva markets. In 2014 and 2013, impairments of identifiable intangible assets w ere $224 million and $393 million, respectively. Property, plant and equipment - $96 million, based on management decisions regarding their expected use as a result of Teva's planned plant rationalization , which triggered a reassessment of fair value. In 2014 and 2013, property, plant and equipment impairment was $163 million and $61 million, respectively. Contingent consideration In 2015, Teva recorded $399 million of contingent consideration expenses, including $31 1 million following the positive phase 2b results of TEV-48125 in both chronic and episodic migraine prevention and $6 3 million due to the FDA approval of Bendeka TM , compared to income of $20 million in 2014 and an expense of $36 million in 2013. Acquisition costs In 2015, Teva recorded $211 million of acquisition expenses, comprised mainly of expenses related to its intended Actavis Generics and Rimsa acquisitions as well as a $105 million expense , reflecting the difference between the purchase price of the interest acquired in Mylan and its fair value as of June 30, 2015 , compared to $13 million and $27 million in 2014 and 2013, respectively. Restructuring In 2015, Teva recorded $183 million of restructuring expenses, compared to $246 million and $201 million in 2014 and 2013, respectively. These expenses were primarily incurred in various initiatives as part of cost saving efforts. b. Share in losses of associated companies–net : Share in losses of associated companies – net amounted to $121 million, compared to $5 million in 2014. Following an other-than-temporary loss in va lue of our inv estment in Mesoblast due to adverse changes in market conditions, an impairment of $171 million was recorded for the year ended December 31, 2015 under "Share in losses of associated companies – net". In addition, a $24 million currency translation adjustment was reclassified from accumulated other comprehensive loss to "Share in losses of associated companies - net", due to dilution of our equity holding s in Mesoblast . The amounts mentioned above were recorded net of income tax of $71 million. |
LEGAL SETTLEMENTS
LEGAL SETTLEMENTS | 12 Months Ended |
Dec. 31, 2015 | |
Legal [Abstract] | |
Legal [TextBlock] | NOTE 19 —LEGAL SETTLEMENTS AND LOSS CONTINGENCIES: Legal settlements and loss contingencies for 2015 amounted to $631 million, compared to a gain of $111 million and an expense of $1.5 billion in 2014 and 2013 , respectively . The 2015 balance is comprised mainly of additional reserves related to the settlement of the modafinil antitrust litigation, partially offset by insurance proceeds relating to the settlement of the pantoprazole patent litigation. |
SEGMENTS
SEGMENTS | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting [Abstract] | |
Segment Reporting Disclosure | <> NOTE 2 0 – SEGMENTS: <><> < Teva has two reportable segments: generic and specialty medicines. The generics segment develops, manufactures, sells and distributes generic or branded generic medicines as well as active pharmaceutical ingredients (“API”). The specialty segment engages in the development, manufacture, sale and distribution of branded specialty medicines such as those for central nervous system and respiratory indications, as well as those marketed in the women's health , oncology and other specialty businesses. Teva's other activities include the over-the-counter (“OTC”) medicines business, distribution activity mainly in Israel and Hungary and medical devices. The OTC activity is primarily conducted through a joint venture with P&G, which combines Teva's production capabilities and market reach with P&G's marketing expertise and expansive global platform . Teva's chief executive officer, 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 two identified reportable segments, namely generic and specialty medicines, and revenues by geographical markets. The accounting policies of the individual segments are the same as those described in the summary of significant accounting policies in n ote 1 to the consolidated financial stat ements. Segment profit consists of gross profit, less S&M and R&D expenses related to the segment. Segment profit does not include G&A expenses, amortization and certain other items. Beginning in 2015, expenses related to equity compensation are excluded from segment results. The data presented has been conformed to reflect the exclusion of equity compensation expenses for all periods. Teva manages its assets on a total company basis, not by segments, as many of it s assets are shared or commingled. Teva's CODM does not regularly review asset information by reportable segment , and therefore Teva do es not report asset information by reportable segment. During 2014, the classification of certain of Teva's products was changed, in line with the Company's strategy. The comparable figures have been conformed to reflect the revised classification for all periods. Teva's chief executive officer reviews the Company's strategy and organizational structure on a continuing basis. Any changes in strategy may lead to a reevaluation of Teva's current segments and goodwill assignment . a. Segment information: Generics Specialty Year ended December 31, Year ended December 31, 2015 2014 2013 2015 2014 2013 (U.S.$ in millions) (U.S.$ in millions) Revenues $ 9,546 $ 9,814 $ 9,902 $ 8,338 $ 8,560 $ 8,388 Gross profit 4,499 4,253 4,083 7,200 7,457 7,274 R&D expenses 513 512 488 918 872 877 S&M expenses 1,304 1,575 1,915 1,921 1,990 1,856 Segment profit $ 2,682 $ 2,166 $ 1,680 $ 4,361 $ 4,595 $ 4,541 Year ended December 31, 2015 2014 2013 U.S.$ in millions Generic medicines profit $ 2,682 $ 2,166 $ 1,680 Specialty medicines profit 4,361 4,595 4,541 Total segment profit 7,043 6,761 6,221 Profit of other activities 318 226 243 Total profit 7,361 6,987 6,464 Amounts not allocated to segments: Amortization 838 1,036 1,180 General and administrative expenses 1,239 1,217 1,239 Legal settlements and loss contingencies 631 (111) 1,524 Impairments, restructuring and others 1,131 650 788 Other unallocated amounts 170 244 84 Consolidated operating income 3,352 3,951 1,649 Financial expenses - net 1,000 313 399 Consolidated income before income taxes $ 2,352 $ 3,638 $ 1,250 b. Segment revenues by geographic area: Year ended December 31, 2015 2014 2013 (U.S.$ in millions) Generic Medicines United States $ 4,793 $ 4,418 $ 4,172 Europe* 2,706 3,148 3,362 Rest of the World 2,047 2,248 2,368 Total Generic Medicines 9,546 9,814 9,902 Specialty Medicines United States 6,442 6,110 6,025 Europe* 1,518 1,898 1,854 Rest of the World 378 552 509 Total Specialty Medicines 8,338 8,560 8,388 Other Revenues United States 14 106 264 Europe* 666 777 772 Rest of the World 1,088 1,015 988 Total Other Revenues 1,768 1,898 2,024 Total Revenues $ 19,652 $ 20,272 $ 20,314 * All members of the European Union, Switzerland, Norway, Albania and the countries of former Yugoslavia. c. Net revenues from specialty medicines were as follows: Year ended December 31, 2015 2014 2013 (U.S. $ in millions) CNS $ 5,213 $ 5,575 $ 5,545 Copaxone® 4,023 4,237 4,328 Azilect® 384 428 371 Nuvigil® 373 388 320 Respiratory 1,129 957 964 ProAir® 549 478 429 Qvar® 392 286 328 Oncology 1,201 1,180 1,005 Treanda® 741 767 709 Women's health 461 504 510 Other Specialty 334 344 364 Total Specialty Medicines $ 8,338 $ 8,560 $ 8,388 The data presented have been conformed to reflect the revised classification of certain products for all periods. A significant portion of Teva's revenues, and a higher proportion of Teva's profits, come from the manufacture and sale of patent-protected pharmaceuticals. Many of Teva's specialty medicines are covered by several patents that expire at different times. Nevertheless, once patent protection has expired, or has been lost prior to the expiration date as a result of a legal challenge, Teva no longer ha s patent exclusivity on these products, and subject to regulatory approval, generic pharmaceutical manufacturers are able to produce similar (or purportedly similar) products and sell them for a lower price. The commencement of generic competition, even in the form of non-equivalent products, can result in a substantial decrease in revenues for a particular specialty medicine in a very short time. Any such expiration or loss of intellectual property rights could therefore significantly adversely affect Teva's results of operations and financial condition. In particular, Teva reli es heavily on sales of Copaxone ® , its leading specialty medicine. A key element of Teva's business strategy for Copaxone ® is the continued migration of current daily Copaxone ® 20 mg/mL patients to the three-times-a-week 40 mg/mL version introduced in 2014, and the maintenance of patients on that new version. Any substantial reduction in the number of patients taking Copaxone ® , whether due to the competing 20 mg/mL generic product introduced in June 2015 or to the increased use of oral medicines or other competing products, would likely have a material adverse effect on Teva's financial results and cash flow . Copaxone ® 40 mg/mL is protected by three U.S. Orange Book patents that expire in 2030, which are being challenged in paragraph IV litigation and in patent office proceedings in the United States, and a fourth U.S. Orange Book patent expiring in 2030 that was issued in October 2015. It is also protected by one European patent expiring in 2030, the validity of which was confirmed by the European Patent Office in December 2015, which rejected all invalidity claims. In 2015 , Copaxone ® revenues in the United States, which include revenues from both Copaxone ® 20 mg/mL and the new Copaxone ® 40 mg/mL product, amounted to $3.2 billion in the U.S. (approximately 29% of Teva's total 2015 U.S. revenues) and approximately $783 million in markets outside the U.S. (approximately 9% of Teva's total 2015 non-U.S. revenues). Teva's multiple sclerosis franchise includes Copaxone ® products and laquinimod (a developmental compound for the treatment of multiple sclerosis ). The profitability of the multiple sclerosis franchise is comprised of Copaxone ® revenues and cost of goods sold as well as S&M and R&D expenses related to the MS franchise. It does not include G&A expenses, amortization and non-recurring items. Teva's MS franchise profitability was 77% , 75% and 76% in 2015 , 2014 and 2013 , respectively. <> d. Supplemental data - major customers: The percentages o f total consolidated revenues for the years ended December 31, 2015 , 2014 and 2013 to one customer were 20% , 18% and 17%, respectively. The percentage of total consolidated revenues f rom another customer accounted for 20% , 17% and 13% for the years ended December 31, 2015 , 2014 and 2013 , respectively. Most of Teva's revenues from these customers were in the United States. The balance s due from the Company's largest customer accounted for 30% and 31% of the gross trade accounts receivable at December 31, 2015 and 2014, respectively . Sales reserves and allowances on these balances are recorded in current liabilities. e. Property, plant and equipment—by geographical location were as follows: December 31, 2015 2014 (U.S. $ in millions) Israel $ 2,159 $ 1,949 United States 629 691 Croatia 539 515 Hungary 506 520 Japan 415 446 Germany 332 367 Other 1,964 2,047 Total property, plant and equipment $ 6,544 $ 6,535 |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | NOTE 21—EARNINGS PER SHARE: The net income attributable to Teva and the weighted average number of ordinary shares used in computation of basic and diluted earnings per share for the years ended December 31, 2015, 2014 and 2013 are as follows: 2015 2014 2013 (U.S. $ in millions, except share data) Net income attributable to ordinary shareholders $ 1,573 $ 3,055 $ 1,269 + Interest expense on convertible senior debentures, and issuance costs , net of tax benefits - * * + Net income used for the computation of diluted earnings per share $ 1,573 $ 3,055 $ 1,269 Weighted average number of shares used in the computation of basic earnings per share 855 853 849 Add: Additional shares from the assumed exercise of employee stock options and unvested RSUs 5 3 1 Weighted average number of additional shares issued upon the assumed conversion of convertible senior debentures 4 2 * Weighted average number of shares used in the computation of diluted earnings per share 864 858 850 * Represents an amount less than 0.5 million. In computing dilutive earnings per share for the years ended December 31, 2015, 2014 and 2013, no account was taken of the potential dilution of the assumed exercise of employee stock options, amounting to 1 million, 1 million and 7 million weighte d average shares, respectively, since they had an anti-dilutive effect on earnings per share. Additionally, in computing dilutive earnings per share for the year ended December 31, 2015, no account was taken of both the potential dilution of the mandatory convertible preferred shares amounting to three million weighted average shares and the accrued dividend to preferred shares amounting to $15 million , since they had an anti-dilutive effect on earnings per share . |
SCHEDULE II VALUATION AND QUALI
SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2015 | |
Schedule Of Valuation And Qualifying Accounts [Abstract] | |
Schedule of Valuation and Qualifying Accounts | TEVA PHARMACEUTICAL INDUSTRIES LIMITED SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS Three Years Ended December 31, 2015 (U.S. $ in millions) Column A Column B Column C Column D Column E Balance at beginning of period Charged to costs and expenses Charged to other accounts Deductions Balance at end of period Allowance for doubtful accounts: Year ended December 31, 2015 $ 149 $ 18 $ (6) $ (15) $ 146 Year ended December 31, 2014 $ 187 $ 22 $ (18) $ (42) $ 149 Year ended December 31, 2013 $ 145 $ 44 $ 3 $ (5) $ 187 Allowance in respect of carryforward tax losses: Year ended December 31, 2015 $ 671 $ 249 $ 1 $ (161) $ 760 Year ended December 31, 2014 $ 791 $ 128 $ 0 $ (248) $ 671 Year ended December 31, 2013 $ 726 $ 182 $ 0 $ (117) $ 791 |
SIGNIFICANT ACCOUNTING POLICI30
SIGNIFICANT ACCOUNTING POLICIES (Policies) | Dec. 31, 2015 | Dec. 31, 2015 |
Significant Accounting Policies [Abstract] | ||
General | 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 i n the development, manufacturing, marketing and distribution of generic, specialty, and other pharmaceutical products . The majority of the Group's revenues are in the United States and Europe . The Group's main manufacturing facilities are located in Israel, Hungary, United States, Germany, Canada, Japan, Ireland, the United Kingdom, t he Czech Republic, Croatia , Italy and India . Accounting principles The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”). Functional currency A major part of the Group's operations is carried out by the Company and its subsidiaries 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 consolidat ed financial statements , translat ed into U.S. dollars. Assets and liabilities are translated at year-end exchange rates, while revenues and expenses are translated at monthly average exchange rates during the year. Differences resulting from translation are presented as other comprehensive income in the consolidated statements of comprehensive income. The financial statements for our Venezuela n business , which has a highly inflationary economy , are remeasured as if the functional currency was the U.S. dollar, Teva's reporting currency, using a translation rate determined by the country's official preferential rate. A highly inflationary economy is one that has cumulative inflation of approximately 100 percent or more over a 3-year period. See note 16a. Use of estimates in the preparation of financial statements The preparation of financial statements in conformity with US GAAP requires management 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 uncertain tax positions, valuation allowances, assessment of impairment of intangible assets and goodwill , purchase price allocation on acquisitions , contingencies, restructuring and sales and reserves allowances . | |
Principles of consolidation | Principles of consolidation: The consolidated financial statements include the accounts of the Company and its majority-owned subsidiaries and Variable Interest Entities ("VIEs") for which the Company is considered the primary beneficiary. For VIEs, the Company perform s an analysis to determine whether the variable interests give a controlling financial interest in a VIE ; t he Company periodically reassesses whether it controls its VIEs . I ntercompany transactions and balances are eliminated in consolidation; profits from intercompany sales, not yet realized outside the Group, are also eliminated . The Company includes the results of operations of acquired businesses from the date of acquisition. | |
Investee companies | Investee companies: I nvestments in entities in which the Company has a significant influence are accounted for using the equity method and included within other non-current assets. Under the equity method , the Company generally recognizes its proportionate share of comprehensive income or loss of the entity. Other non-marketable equity investments are carried at cost. The Company also reviews these investments for impairment whenever events indicate the carrying amount may not be recoverable. Impairments on investee companies are recorded in the income statement under share in losses of associated companies – net . | |
Cash and cash equivalents | 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. | |
Inventories Policy | e. Inventories: Inventories are valued at the lower of cost or market. Cost of raw and packaging materials is determined mainly on a moving average basis. Cost of purchased products is determined mainly on a standard cost basis, approximating average costs. Cost of manufactured finished products and products in process is calculated assuming normal manufacturing capacity as follows: raw and packaging materials component is determined mainly on a moving average basis , while the capitalized production costs are determined either on a n average basis over the production period , or on a standard cost bas is, approximating average costs. Inventories acquired in a business combination are stepped-up to their estimated fair value and amortized to c ost of sales as that inventory is sold . Teva updated its inventory policy to verify that inventory is measured against net realizable value, as defined by the new accounting pronouncement. | |
Marketable securities | f. Investment in s ecurities: Investment in securities consists mainly of debt and equity securities classified as available-for-sale and recorded at fair value. The fair value of quoted securities is based on current market value. When debt securities do not have an active market, fair value is determined using a valuation model. This model is based on reference to other instruments with similar characteristics, or a discounted cash flow analysis, or other pricing models making use of market inputs and relying as little as possible on entity-specific inputs . U nrealized gains of available for sale 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 both debt and equity securities are included in f inancial 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, and for equity securities, the Company's ability and intent to hold the investment for the length of time necessary to allow for the recovery of the market value . 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 f inancial 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 . | |
Impairment in value of long-lived assets | g. Long-lived assets : Teva's long-lived, non-current assets are comprised mainly of goodwill, identifiable intangible assets and property, plant and equipment. Teva review s its long-lived assets and perform s detailed testing whenever potential impairment indicators are present. In addition, the Company perform s impairment testing as of October 1 of each year for goodwill and identifiable indefinite life intangible assets . | |
Goodwill and indefinite life intangible assets | Goodwill Goodwill reflects the excess of the consideration paid or transferred plus the fair value of contingent consideration and any non-controlling interest in the acquiree at the acquisition date over the fair values of the identifiable net assets acqu ired. The goodwill impairment test is performed according to the following principles: An initial qualitative assessment of the likelihood of impairment may be performed. If this step does not result in a more likely than not indication of impairment, no further impairment testing is required. If it does result in a more likely than not indication of impairment, the impairment test is performed. In step one of the impairment test, Teva compares the fair value of the reporting units to the carrying value of net assets allocated to the reporting units. If the fair value of the reporting unit exceeds the carrying value of the net assets allocated to that unit, goodwill is not impaired, and no further testing is required. Otherwise , Teva must perform the second step of the impairment test to measure the amount of the impairment. In the second step, the reporting unit's fair value is allocated to all the assets and liabilities of the reporting unit, including any unrecognized intangible assets, in a hypothetical analysis that simulates the business combination principles to derive an implied goodwill value. If the implied fair value of the reporting unit's goodwill is less than its carrying value, the difference is recorded as an impairment. | |
Definite life intangible assets | 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 using mainly the straight-line method over their estimated period of useful life , or based on economic effect models, if more appropriate, which is determined by identifying the period 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 expenses. For definite life intangibles, whenever impairment indicators are identified , Teva reconsiders the asset's estimated life, calculate s the undiscounted value of the asset's cash flows and compare s such value against the asset'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 . Indefinite life intangible assets are mainly comprised of research and develop ment in-process . Teva monitors development for any triggering events. Annually or when triggering events are present, Teva determine s the fair value of th e asset based on discounted cash flows on and records an impairment loss if book value exceeds fair value. Research and development in-process acquired in a business combination is capitalized as an i ndefinite life intangible asset until the related research and development efforts are either completed or abandoned. In the reporting period where they are treated as indefinite life intangible assets, they are not amortized but rather are monitored 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, the related research and development assets are impaired. | |
Property, plant and equipment | 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, whenever impairment indicators are identified , Teva reconsiders the asset's estimated life, calculate s the undiscounted value of the asset's cash flows and compare s such value against the asset's carrying amount. If the carrying amount is greater, Teva record s an impairment loss for the excess of book value over fair value . | |
Contingencies | h . Contingencies: The Company and its subsidiaries are 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 or contingent consideration or 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 virtually certain of occurring at the gross amount that is expected to be collected. Legal costs are expensed as incurred . Contingent considerati on and other contingent liabilities incurred or acquired in a business combination are recorded at a probability weighted assessment of their fair value and monitored on an ongoing basis for changes in that value. | |
Tax contingencies | 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-evaluate s its tax positions based on developments in its tax audits, statute of limitations expirations, changes in tax laws and new information that can affect the technical merits and change the assessment of Teva's ability to sustain the tax benefit. In addition, the Company classifies interest and penalties recognized in the financial statements relating to uncertain tax position under the income taxes line item . P rovisions for uncertain tax positions, where as 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 . | |
Treasury shares | j . Treasury shares: Treasury shares are held by Teva's subsidiaries and presented as a reduction of Teva shareholders' equity and carried at their cost to Teva, under t reasury shares. | |
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | k . Stock-based compensation: Teva recognizes the estimated fair value of share-based awards, restricted share units (“RSUs”) and performance share units ("PSUs"), net of estimated forfeitures, under stock-based compensation costs. 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 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. | |
Revenue recognition | l . Revenue recognition: 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 under current liabilities. Prompt payment discounts are netted against accounts receivable. 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 new 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 m ilestone events stipulated in agreements is recognized when the milestone is achieved. Milestones are based upon the occurrence of a substantive element specified in the contract or as a measure of substantive progress towards completion under the contract. R evenue s from licensees, sales of l icensed 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. Revenues include royalty income and income from services , which amounted to $ 140 million, $167 million and $182 million in the years ended December 31, 2015 , 2014 and 2013 , respectively. | |
Research and development expenses | m . 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 and capitalized. Such amounts are recognized as an expense as the related goods are delivered or the services are performed. Research and development in-process acquired as part of an asset purchase, which has not reached technological feasibility and has no alternative future use, is expensed as incurred. | |
Shipping and handling costs | n . Shipping and handling costs: Shipping and handling costs, which are included in selling and marketing expenses , amounted to $ 127 million, $ 151 million and $ 232 million for the years ended December 31, 2015 , 2014 and 2013 , respectively. | |
Advertising expenses | o . Advertising expenses: Advertising expenses are charged to income as incurred. Advertising expenses for the years ended December 31, 2015 , 2014 and 2013 were $ 297 million, $ 302 million and $ 321 million, respectively. | |
Income taxes | p . Deferred i ncome 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 bas i s 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 v aluation 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. I n determining whether a valuation allowance is needed , Teva consider s 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 current or non-current based on the classification of the related asset or liability for financial reporting, or according to the expected reversal dates of the specific temporary differences where appropriate. 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. (2) Amounts of tax-exempt income generated from the Company's current A pproved E nterprises and unremitted earnings from foreign subsidiaries retained for reinvestment in the Group. S ee note 1 5 f . | |
Earnings per share | q . 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) 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 RSUs and PSUs granted under employee stock compensation plans and one series of convertible senior debentures, using the treasury stock method; (ii) the conversion of the remaining convertible senior debentures using the “if-converted” method, by adding to net income interest expense on the debentures and amortization of issuance costs, net of tax benefits, and by adding the weighted average number of shares issuable upon assumed conversion of the debentures ; and ( iii ) the conversion of the mandatory convertible preferred shares using the “if-converted” method b y adding to net inco me attributable to ordinary shareholders the dividend s on the preferred shares and by adding the weighted average number of shares issuable upon assumed conversion of the mandatory convertible preferred shares . | |
Concentration of credit risks | r . Concentration of credit risks: Most of Teva 's cash and cash equiva lents (which along with investment in securities amounted to $8.4 billion at December 31, 2015) were deposited with financially sound European , U.S. and Israeli banks and financial institutions and were comprised mainly of cash deposits. The pharmaceutical industry, particularly in the U.S. , has been significantly affected by consolidation among managed care providers, large pharmacy chains, wholesaling organizations and other buyer groups. The U.S. market constitutes approximately 57.2 % of Teva's consolidated revenues and a relatively small portion of total trade accounts after net ting amounts in sales, reserves and allowances . T he exposure of credit risks relating to other trade receivables is limited, due to the relatively large number of g roup customers and their wide geographic distribution. T eva performs ongoing credit evaluations of its customers for the purpose of determining the appropriate allowance for doubtful accounts and generally does not require collateral. An appropriate allowance for doubtful accounts is included in the accounts and netted against accounts receivable . | |
Derivative | s . Derivatives and hedging : The G roup carries out transactions involving derivative financial instruments (mainly forward exchange contracts, written and purchased 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 exposure s . The Company does not enter into derivative transactions for trading purposes. Derivative instruments that qualify for hedge accounting are recognized on the balance sheet at their fair value. For derivative instruments that are designated 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 are recognized in “financial expenses—net” in the statement s of income during the current period. For derivative instruments that are designated and qualify as a cash-flow hedge, the effective portion of 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. The remaining gain or loss on the derivative instrument (i.e., the ineffective portion), if any , is recognized in the statement of income during the current period. 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 i nstruments 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. | |
Fair value measurement | t . 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 credit risk in its assessment of fair value . | |
Collaborative arrangements | u . Collaborative arrangements: A C ollaborative agreements are contractual arrangement s 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. See note 2. The Company recognizes revenue generated and costs incurred on sales to third parties as it relate to a collaborative agreement as gross or net . If the Company is the principal participant in a transaction , revenues are record ed on a gross basis ; otherwise, revenues are recorded on a net basis. | |
Segment reporting | v . Segment reporting: The Company's business includes two reporting segments: generic and specialty medicines. The generics segment develops, manufactures, sells and distributes generic or branded generic medicines as well as active pharmaceutical ingredients ("API"). The specialty segment engages in the development, manufacture, sale and distribution of branded specialty medicines such as those for central nervous system and respiratory indications, as well as those marketed in the women's health, oncology and other specialty businesses. See note 20 . | |
Costs associated with exit or disposal activities or restructurings | w . Re structuring : Restructuring charges are initially recorded at fair value, and recognized in connection with restructuring programs designed to reduce the cost structure, increase efficiency and enhance competitiveness . Judgment is used when estimating the impact of restructuring plans, including future termination benefits and other exit costs to be incurred when the actions take place. Costs for one-time termination benefits in which the employee is required to render service until termination in order to receive the benefits are recognized ratably over the future service period. | |
Reclassifications | x . Reclassifications: Certain comparative figures have been reclassified to conform to the current year presentation. | |
Recently issued accounting pronouncements | y . Recently issued accounting pronouncements: In November 2015, the Financial Accounting Standards Board (the "FASB") issued guidance on balance sheet classification of deferred taxes . The new guidance requires entities to present all deferred tax assets and liabilities, along with any related valuation allowance, as non - current on the balance sheet . The guidance is effective for interim and annual periods beginning after December 15, 2016 (early adoption is permitted). Teva is currently evaluating the potential effect of the guidance on its consolidated financial statements. In September 2015, the FASB issued guidance on current a ccounting for m easurement- p eriod a djustments. Th e new guidance requires entities to recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. Measurement period adjustments were previously required to be retrospectively adjusted as of the acquisition date. The provisions of this update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015 (e arly adoption is permitted ), and should be applied prospectively. Teva does not expect this guidance to have a material effect on its consolidated financial statements at the time of adoption of this standard . In July 2015, the FASB issued guidance on current accounting for inventory measurement. The new guidance requires entities to measure inventory at the lower of cost or net realizable value. Net realizable value is defined by the guidance as the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. The guidance is effective for the interim and annual periods beginning on or after December 15, 2016 (early adoption is permitted). Teva adopted the new guidance in the third quarter of 2015, and it had an immaterial impact on its co nsolidated financial statements . In April 2015, the FASB issued guidance on debt issuance costs . The guidance requires entities to present debt issuance costs related to a recognized debt liability as a direct deduction from the carrying amount of that debt in the balance sheet. This guidance does not contain guidance for debt issuance costs related to line-of-credit arrangements. Consequently, in August 2015, the FASB issued additional guidance to add paragraphs indicating that the SEC staff would not object to an entity deferring and presenting debt issuance costs related to line-of-credit arrangements as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement . The guidance is effective for the interim and annual periods beginning on or after December 15, 201 5 . Teva does not expect this guidance to have a material effect on its consolidated financial statements at the time of adoption of this standard . In February 2015, the FASB issued amended guidance on current accounting for consolidation of certain entities. Pursuant to this guidance , reporting enterprises should evaluate whether (a) they should consolidate limited partnerships and similar entities, (b) fees paid to a decision maker or service provider are variable interests in a variable interest entity ("VIE "), and (c) variable interests in a VIE held by related parties of the reporting enterprise require the reporting enterprise to consolidate the VIE. The guidance is effective for the interim and annual periods beginning on or after December 15, 2015. Teva does not expect this guidance to have a material effect on its consolidated financial statements at the time of adoption of this standard . In May 2014, the FASB issued guidance on revenue from contracts with customers that will supersede most current revenue recognition guidance, including industry-specific guidance. The underlying principle is that an entity will recognize revenue upon the transfer of goods or services to customers in an amount that the entity expects to be entitled to in exchange for those goods or services. The guidance provides a five-step analysis of transactions to determine when and how revenue is recognized. Other major provisions include capitalization of certain contract costs, consideration of the time value of money in the transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. The guidance also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity's contracts with customers. The guidance is effective for the interim and annual periods beginning on or after December 15, 2017 (early adoption is permitted for the interim and annual periods beginning on or after December 15, 2016). The guidance permits the use of either a retrospective or cumulative effect transition method. Teva is currently evaluating the impact of the guidance on its consolidated financial statements . |
CERTAIN TRANSACTIONS (Tables)
CERTAIN TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Certain Transactions Tables [Abstract] | |
Estimated fair values of assets acquired and liabilities assumed | U.S.$ in millions Cash and cash equivalents $ 201 Other current assets 6 Deferred taxes and other assets 126 Identifiable intangible assets: Research and development in-process 3,143 Goodwill 1,146 Total assets acquired 4,622 Current liabilities 29 Deferred taxes 1,131 Total liabilities assumed 1,160 Net assets acquired $ 3,462 |
FAIR VALUE MEASUREMENT (Tables)
FAIR VALUE MEASUREMENT (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value Measurement Tables [Abstract] | |
Financial items carried at fair value | December 31, 2015 Level 1 Level 2 Level 3 Total U.S. $ in millions Cash and cash equivalents: Money markets $ 162 $ - $ - $ 162 Cash deposits and other 6,784 - - 6,784 Investment in securities: Equity securities 1,352 - - 1,352 Structured investment vehicles - 94 - 94 Other 11 - 1 12 Derivatives: Asset derivatives - options and forward contracts - 25 - 25 Asset derivatives - interest rate, cross-currency and forward starting interest rate swaps - 105 - 105 Liabilities derivatives - options and forward contracts - (11) - (11) Liabilities derivatives - treasury locks, interest rate and forward starting interest rate swaps - (26) - (26) Contingent consideration* - - (812) (812) Total $ 8,309 $ 187 $ (811) $ 7,685 December 31, 2014 Level 1 Level 2 Level 3 Total U.S. $ in millions Cash and cash equivalents: Money markets $ 10 $ - $ - $ 10 Cash deposits and other 2,216 - - 2,216 Escrow fund 125 - - 125 Investment in securities: Auction rate securities - - 13 13 Equity securities 66 - - 66 Structured investment vehicles - 96 - 96 Other, mainly debt securities 73 - 1 74 Derivatives: Asset derivatives - options and forward contracts - 82 - 82 Asset derivatives - cross-currency swaps - 20 - 20 Liability derivatives - options and forward contracts - (54) - (54) Liability derivatives - interest rate swaps - (43) - (43) Contingent consideration* - - (630) (630) Total $ 2,490 $ 101 $ (616) $ 1,975 The following table summarizes the activity for those financial assets and liabilities where fair value measurements are estimated utilizing Level 3 inputs. December 31, December 31, 2015 2014 U.S. $ in millions Fair value at the beginning of the period $ (616) $ (347) Auction rate securities realized (13) (5) Additional contingent consideration resulting from: Eagle license (128) - Labrys acquisition - (251) Gecko acquisition (5) - NuPathe acquisition - (83) Adjustments to provisions for contingent consideration: Labrys acquisition (311) (1) Eagle license (63) - MicroDose acquisition (10) 83 Cephalon acquisition (5) (56) NuPathe acquisition (10) (6) Settlement of contingent consideration: Labrys acquisition 350 - Cephalon acquisition - 21 Sale of animal health unit - (5) Adjustments to contingent considerations due to changes in purchase price allocations and others - 34 Fair value at the end of the period $ (811) $ (616) Financial instruments measured on a basis other than fair value are mostly comprised of senior notes and convertible senior debentures, and are presented in the below table in terms of fair value: Estimated fair value* December 31, 2015 2014 (U.S. $ in millions) Senior notes included under long-term liabilities $ (7,305) $ (7,776) Senior notes and convertible senior debentures included under short-term liabilities (1,778) (1,731) Fair value at the end of the period $ (9,083) $ (9,507) * The fair value was estimated based on quoted market prices, where available. |
INVESTMENT IN SECURITIES (Table
INVESTMENT IN SECURITIES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Marketable Securities Tables [Abstract] | |
Available-for-sale securities | Fair value Amortized cost Gross unrealized holding gains Gross unrealized holding losses (U.S. $ in millions) December 31, 2015 $ 1,620 $ 1,303 $ 338 $ 21 December 31, 2014 $ 259 $ 266 $ 19 $ 26 |
Marketable securities | December 31, 2015 2014 (U.S. $ in millions) Other non-current assets $ 1,447 $ 176 Cash and cash equivalents, mainly money market funds 162 10 Other current assets 11 73 $ 1,620 $ 259 |
Contractual maturities of debt securities | b. Contractual maturities: The contractual maturities of debt securities are as follows: December 31, 2015 (U.S. $ in millions) 2016 $ 173 2021 and thereafter 95 $ 268 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Inventories Tables [Abstract] | |
Inventory current | NOTE 5—INVENTORIES: Inventories, net of reserves, consisted of the following: December 31, 2015 2014 (U.S. $ in millions) Finished products $ 2,050 $ 2,268 Raw and packaging materials 1,195 1,279 Products in process 535 638 Materials in transit and payments on account 186 186 $ 3,966 $ 4,371 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Property Plant And Equipment Tables [Abstract] | |
Property, plant and equipment, net | NOTE 6—PROPERTY, PLANT AND EQUIPMENT: Property, plant and equipment, net, consisted of the following: December 31, 2015 2014 (U.S. $ in millions) Machinery and equipment $ 5,071 $ 4,893 Buildings 2,591 2,653 Computer equipment and other assets 1,492 1,391 Payments on account 525 571 Land* 394 372 10,073 9,880 Less—accumulated depreciation 3,529 3,345 $ 6,544 $ 6,535 * Land includes long-term leasehold rights in various locations, with useful lives of between 30 and 99 years. Depreciation expenses were $449 million, $464 million and $458 million in the years ended December 31, 2015, 2014 and 2013, respectively. During the years ended December 31, 2015, 2014 and 2013, Teva had impairments of property, plant and equipment in the amount of $96 million, $163 million and $61 million, respectively. See note 18. |
GOODWILL DISCLOSURE (Tables)
GOODWILL DISCLOSURE (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill [Abstract] | |
Schedule of goodwill | NOTE 7—GOODWILL: The changes in the carrying amount of goodwill for the years ended December 31, 2015 and 2014 were as follows: Generics Specialty Other Total (U.S. $ in millions) Balance as of January 1, 2014 $ 9,088 $ 8,668 $ 1,225 $ 18,981 Changes during year: Goodwill acquired - 183 - 183 Translation differences and other (358) (349) (49) (756) Balance as of December 31, 2014 $ 8,730 $ 8,502 $ 1,176 $ 18,408 Changes during year: Goodwill acquired* - 1,212 - 1,212 Translation differences and other (265) (294) (36) (595) Balance as of December 31, 2015 $ 8,465 $ 9,420 $ 1,140 $ 19,025 *Mainly due to the Auspex acquisition in May 2015. |
IDENTIFIABLE INTANGIBLE ASSET (
IDENTIFIABLE INTANGIBLE ASSET (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Identifiable Intangible Asset [Abstract] | |
Identifiable Intangible Asset [Table Text Block] | NOTE 8 - IDENTIFIABLE INTANGIBLE ASSETS: Identifiable intangible assets consisted of the following: Original amount net of impairment Accumulated amortization Amortized balance December 31, 2015 2014 2015 2014 2015 2014 (U.S. $ in millions) Product rights $ 9,047 $ 9,606 $ 5,876 $ 5,343 $ 3,171 $ 4,263 Trade names 212 243 40 54 172 189 Research and development in process 4,332 1,060 0 0 4,332 1,060 Total $ 13,591 $ 10,909 $ 5,916 $ 5,397 $ 7,675 $ 5,512 |
SALE RESERVES AND ALLOWENCES (T
SALE RESERVES AND ALLOWENCES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Sales Researves And Allowancess [Abstract] | |
Sales Researves And Allowancess [Table Text Block] | NOTE 9—SALES RESERVES AND ALLOWANCES: Sales reserves and allowances consisted of the following: December 31, 2015 2014 (U.S. $ in millions) Rebates $ 3,382 $ 2,842 Medicaid 1,319 1,099 Chargebacks 1,091 1,129 Returns 598 593 Other 211 186 $ 6,601 $ 5,849 |
LONG TERM EMPLOYEE RELATED OB39
LONG TERM EMPLOYEE RELATED OBLIGATIONS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Long Term Employee Related Obligations Tables [Abstract] | |
Long-term employee-related obligations | NOTE 10—LONG-TERM EMPLOYEE-RELATED OBLIGATIONS: a. Long-term employee-related obligations consisted of the following: December 31, 2015 2014 (U.S. $ in millions) Accrued severance obligations $ 123 $ 146 Defined benefit plans 157 188 Total $ 280 $ 334 |
DEBT OBLIGATIONS (Tables)
DEBT OBLIGATIONS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Senior Notes And Loans Tables [Abstract] | |
Schedule of senior notes and loans | NOTE 11—DEBT OBLIGATIONS: a. Short-term debt: December 31, Weighted average interest rate as of December 31 Maturity 2015 2014 (U.S. $ in millions) Bank and financial institutions 2.05% $ 75 $ 46 Convertible debentures (see note 12) 0.25% 2026 521 530 Current maturities of long-term liabilities 989 1,185 Total short term debt $ 1,585 $ 1,761 b. Long-term debt includes the following: Weighted average interest rate as of December 31, 2015 Maturity December 31, 2015 2014 % (U.S. $ in millions) Senior notes USD 613 million (1) 3.65% 2021 $ 611 $ 873 Senior notes USD 588 million (1) 3.65% 2021 586 873 Senior notes USD 700 million 2.25% 2020 700 700 Senior notes USD 950 million 2.40% 2016 950 950 Senior notes EUR 1,000 million 2.88% 2019 1,092 1,213 Senior notes USD 789 million (1) 6.15% 2036 780 974 Senior notes USD 844 million (1) 2.95% 2022 843 1,297 Senior notes CHF 450 million 1.50% 2018 455 455 Senior notes EUR 1,300 million (2) 1.25% 2023 1,409 - Senior notes EUR 700 million (2) 1.88% 2027 762 - Senior notes USD 1,000 million (3) 3.00% 2015 - 1,000 Fair value hedge accounting adjustments (10) (43) Total senior notes $ 8,178 $ 8,292 Term loan EUR 122 million (4) EURIBOR + 1.0% 2015 - 148 Term loan JPY 35 billion 1.42% 2019 290 293 Term loan JPY 65 billion 0.99% 2017 544 549 Term loan JPY 35 billion LIBOR +0.3% 2018 290 293 Other loans JPY 5 billion (5) 1.67% 2019 39 118 Total loans $ 1,163 $ 1,401 Debentures USD 15 million 7.20% 2018 15 15 Other 7.48% 2026 5 - Total debentures and others $ 20 $ 15 Less current maturities 989 1,185 Derivative instruments 11 43 Total long term debt (6) $ 8,383 $ 8,566 The required annual principal payments of long-term debt as of December 31, 2015, starting with the year 2017, are as follows: December 31, 2015 (U.S. $ in millions) 2017 $ 544 2018 760 2019 1,382 2020 700 2021 and thereafter 4,997 $ 8,383 |
EQUITY (Tables)
EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Equity Tables [Abstract] | |
Status of option plans | Year ended December 31, 2015 2014 2013 Number (in thousands) Weighted average exercise price Number (in thousands) Weighted average exercise price Number (in thousands) Weighted average exercise price Balance outstanding at beginning of year 26,733 $ 45.91 32,481 $ 45.05 36,580 $ 44.40 Changes during the year: Granted 7,655 59.82 6,935 48.60 1,701 38.37 Exercised (8,127) 46.88 (11,423) 45.05 (2,797) 32.17 Forfeited (1,028) 48.96 (1,260) 46.11 (3,003) 45.51 Balance outstanding at end of year 25,233 49.69 26,733 45.91 32,481 45.05 Balance exercisable at end of year 11,299 44.67 12,632 47.16 17,082 47.30 |
Schedule of ordinary shares issued upon outstanding options | The following tables summarize information at December 31, 2015 regarding the number of ordinary shares issuable upon (1) outstanding options and (2) vested options: (1) Number of ordinary shares issuable upon exercise of outstanding options Range of exercise prices Balance at end of period (in thousands) Weighted average exercise price Weighted average remaining life Aggregate intrinsic value (in thousands) Number of shares $ Years $ $35.11 - $40.10 3,398 38.61 7.10 91,858 $40.11 - $45.10 4,707 41.93 6.09 111,613 $45.11 - $50.10 7,533 48.55 7.33 128,738 $50.11 - $55.10 1,881 52.18 2.20 25,323 $55.11 - $60.10 1,434 57.85 8.22 11,173 $60.11 - $66.00 6,280 60.27 9.14 33,715 Total 25,233 49.69 7.19 402,420 |
Schedule of ordinary shares issued upon vested options | (2) Number of ordinary shares issuable upon exercise of vested options Range of exercise prices Balance at end of period (in thousands) Weighted average exercise price Weighted average remaining life Aggregate intrinsic value (in thousands) Number of shares $ Years $ $35.11 - $40.10 2,741 38.74 7.02 73,742 $40.11 - $45.10 3,830 41.83 5.87 91,203 $45.11 - $50.10 2,732 48.42 5.97 47,054 $50.11 - $55.10 1,747 52.12 1.72 23,616 $55.11 - $60.10 189 59.58 1.67 1,147 $60.11 - $66.00 60 63.32 1.27 136 Total 11,299 44.67 5.44 236,898 |
Schedule of the number of RSUs issued and outstanding | Year ended December 31, 2015 2014 2013 Number (in thousands) Weighted average grant date fair value Number (in thousands) Weighted average grant date fair value Number (in thousands) Weighted average grant date fair value Balance outstanding at beginning of year 2,466 $43.05 2,512 $40.48 3,744 $41.04 Granted 1,519 56.75 1,342 46.09 289 35.80 Vested (1,112) 41.04 (1,146) 41.55 (1,222) 41.04 Forfeited (322) 48.27 (242) 40.05 (299) 40.98 Balance outstanding at end of year 2,551 51.43 2,466 43.05 2,512 40.48 |
Components of accumulated other comprehensive income (loss) | December 31, 2015 2014 2013 (U.S. $ in millions) Currency translation adjustment $ (2,384) $ (1,283) $ 151 Unrealized loss on defined benefit plans, net (58) (93) (50) Unrealized gain (loss) on derivative financial instruments, net 175 40 (197) Unrealized gain (loss) from available-for-sale securities, net 312 (7) 5 Accumulated other comprehensive loss attributable to Teva $ (1,955) $ (1,343) $ (91) |
Disclosure of Share-based Compensation Arrangements by Share-based Payment Award [Table Text Block] | The weighted average fair value of options granted during the years was estimated by using the Black-Scholes option-pricing model as follows: Year ended December 31, 2015 2014 2013 Weighted average fair value $ 10.9 $ 9.3 $ 6.6 The fair value of these options was estimated on the date of grant, based on the following weighted average assumptions: Year ended December 31, 2015 2014 2013 Dividend yield 2.3% 2.9% 3.3% Expected volatility 24% 25% 23% Risk-free interest rate 1.8% 1.9% 2.1% Expected term 5 years 6 years 9 years Year ended December 31, 2015 2014 2013 (U.S. $ in millions) Employee stock options $ 62 $ 47 $ 40 RSUs and PSUs 55 38 24 Total stock-based compensation expense 117 85 64 Tax effect on stock-based compensation expense 19 14 14 Net effect $ 98 $ 71 $ 50 |
Treasury Stock Shares Acquired [Table Text Block] | Year ended December 31, 2015 2014 2013 (in millions) Amount spent on shares repurchased $ 439 $ 500 $ 497 Number of shares repurchased 7.7 8.7 12.8 |
Accumulated Other Comprehensive Income/(Loss) (net of tax) | The following tables present the changes in the components of accumulated other comprehensive loss attributable to Teva for the years ended December 31, 2015, 2014 and 2013: Year ended December 31, 2015 Components of accumulated other comprehensive loss Description of the reclassification to the statement of income Other comprehensive income (loss) before reclassifications Amounts reclassified to the statement of income Net other comprehensive income (loss) before tax Corresponding income tax Net other comprehensive income (loss) after tax (U.S.$ in millions) Currency translation adjustment Currency translation adjustment, reclassified to share in (income) losses of associated companies – net $ (1,131) $ 24 $ (1,107) $ 6 $ (1,101) Unrealized gain (loss) from available-for-sale securities Loss on marketable securities* (413) 737 324 (5) 319 Unrealized gain (loss) from derivative financial instruments Gain on derivative financial instruments** 137 (2) 135 - 135 Unrealized gain (loss) on defined benefit plans Gain on defined benefit plans, reclassified to various statement of income items*** 33 4 37 (2) 35 Total accumulated other comprehensive income (loss) $ (1,374) $ 763 $ (611) $ (1) $ (612) Year ended December 31, 2014 Components of accumulated other comprehensive loss Description of the reclassification to the statement of income Other comprehensive income (loss) before reclassifications Amounts reclassified to the statement of income Net other comprehensive income (loss) before tax Corresponding income tax Net other comprehensive income (loss) after tax (U.S.$ in millions) Currency translation adjustment Currency translation adjustment, reclassified to financial expenses - net $ (1,429) $ (5) $ (1,434) $ - $ (1,434) Unrealized gain (loss) from available-for-sale securities Gain on marketable securities, reclassified to financial expenses - net (12) 2 (10) (2) (12) Unrealized gain (loss) from derivative financial instruments Loss on derivative financial instruments, reclassified to net revenues 240 (3) 237 - 237 Unrealized gain (loss) on defined benefit plans Loss on defined benefit plans, reclassified to various statement of income items*** (55) (2) (57) 14 (43) Total accumulated other comprehensive income (loss) $ (1,256) $ (8) $ (1,264) $ 12 $ (1,252) Year ended December 31, 2013 Components of accumulated other comprehensive loss Description of the reclassification to the statement of income Other comprehensive income (loss) before reclassifications Amounts reclassified to the statement of income Net other comprehensive income (loss) before tax Corresponding income tax Net other comprehensive income (loss) after tax (U.S.$ in millions) Currency translation adjustment Currency translation adjustment, reclassified to financial expenses - net $ (46) $ 17 $ (29) $ 5 $ (24) Unrealized gain (loss) from available-for-sale securities Gain on marketable securities, reclassified to financial expenses - net 18 (6) 12 - 12 Unrealized gain (loss) from derivative financial instruments Loss on derivative financial instruments, reclassified to net revenues (111) 7 (104) - (104) Unrealized gain (loss) on defined benefit plans Loss on defined benefit plans, reclassified to various statement of income items*** 20 24 44 (2) 42 Total accumulated other comprehensive income (loss) $ (119) $ 42 $ (77) $ 3 $ (74) * $632 million loss reclassified to financial expenses—net and $105 million loss reclassified to impairments, restructuring and others. ** $26 million loss reclassified to financial expenses—net and $28 million gain reclassified to net revenues. *** Affected cost of sales, research and development expenses, selling and marketing expenses and general and administrative expenses. |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Income Taxes [Absract] | |
Schedule of income before income taxes | NOTE 15—INCOME TAXES: a. Income before income taxes: Year ended December 31, 2015 2014 2013 (U.S. $ in millions) Parent Company and its Israeli subsidiaries $ 1,932 $ 2,139 $ 1,303 Non-Israeli subsidiaries 420 1,499 (53) $ 2,352 $ 3,638 $ 1,250 |
Schedule of the provision for income taxes | b. Income taxes: Year ended December 31, 2015 2014 2013 (U.S. $ in millions) In Israel $ 149 $ 147 $ 197 Outside Israel 485 444 (240) $ 634 $ 591 $ (43) Current $ 298 $ 879 $ 1,096 Deferred 336 (288) (1,139) $ 634 $ 591 $ (43) |
Accumulated Other Comprehensive Income/(Loss) (net of tax) | Year ended December 31, 2015 2014 2013 (U.S. $ in millions) Income before income taxes $ 2,352 $ 3,638 $ 1,250 Statutory tax rate in Israel 26.5% 26.5% 25% Theoretical provision for income taxes $ 623 $ 964 $ 313 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 (337) (524) (535) Amendment 69 payments and finalization of prior years' tax audits, net of decrease of related uncertain tax positions - - 248 Non-Israeli subsidiaries 447 88 (275) Increase (decrease) in other uncertain tax positions—net (99) 63 206 Effective consolidated income taxes $ 634 $ 591 $ (43) |
Schedule of deferred income taxes | c. Deferred income taxes: December 31, 2015 2014 (U.S. $ in millions) Short-term deferred tax assets—net: Inventory related $ 382 $ 383 Sales reserves and allowances 254 357 Provision for legal settlements 89 229 Provisions for employee-related obligations 45 66 Carryforward losses and deductions (*) 60 59 Other 64 78 894 1,172 Valuation allowance—in respect of carryforward losses and deductions that may not be utilized (190) (213) $ 704 $ 959 * The amounts are shown after reduction for unrecognized tax benefits of $108 million and $143 million, at December 31, 2015 and 2014, respectively, where Teva has net operating loss carryforwards, similar tax losses, and/or tax credit carryforwards that are available, under the tax law of the applicable jurisdiction, to offset any additional income taxes that would result from the settlement of a tax position. December 31, 2015 2014 Long-term deferred tax assets (liabilities)—net: (U.S. $ in millions) Intangible assets $ (1,900) $ (1,098) Carryforward losses and deductions(*)(**) 989 1,043 Property, plant and equipment (207) (218) Provisions for employee related obligations 65 39 Other 125 (21) (928) (255) Valuation allowance—in respect of carryforward losses and deductions that may not be utilized (570) (458) $ (1,498) $ (713) $ (794) $ 246 * The amounts are shown after reduction for unrecognized tax benefits of $70 million and $150 million as of December 31, 2015 and 2014, respectively. ** This amount represents the tax effect of gross carryforward losses and deductions with the following expirations: 2017-2018 — $47 million; 2019-2025 — $334 million; 2026 and thereafter — $205 million. The remaining balance—$473 million—can be utilized with no expiration date. |
Schedule of deferred income taxes by report caption | The deferred income taxes are reflected in the balance sheets among: December 31, 2015 2014 (U.S. $ in millions) Current assets—deferred income taxes $ 735 $ 993 Current liabilities—other current liabilities (31) (34) Other non-current assets 250 388 Long-term liabilities—deferred income taxes (1,748) (1,101) $ (794) $ 246 |
Schedule of unrecognized tax benefits | Year ended December 31, 2015 2014 2013 (U.S. $ in millions) Balance at the beginning of the year $ 713 $ 665 $ 903 Increase (decrease) related to prior year tax positions, net (6) 38 29 Increase related to current year tax positions 43 51 176 Decrease related to settlements with tax authorities and lapse of applicable statutes of limitations (99) (38) (461) Other (3) (3) 18 Balance at the end of the year $ 648 $ 713 $ 665 |
DERIVATIVE INSTRUMENTS AND HE43
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Financial Instruments And Risk Management Tables [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Table Text Block] | c. Derivative instrument disclosure: The following table summarizes the notional amounts for hedged items, when transactions are designated as hedge accounting: December 31, 2015 2014 (U.S. $ in millions) Forward starting interest rate swap - cash flow hedge $ 3,500 $ - Interest rate swap - fair value hedge 1,294 1,750 Cross-currency swap - cash flow hedge 588 1,875 Treasury lock - cash flow hedge 500 - Forecasted transactions - cash flow hedge - 280 The following table summarizes the classification and fair values of derivative instruments: Fair value Designated as hedging instruments Not designated as hedging instruments December 31, 2015 December 31, 2014 December 31, 2015 December 31, 2014 Reported under (U.S. $ in millions) Asset derivatives: Other current assets: Cross-currency swaps - cash flow hedge $ - $ 14 $ - $ - Forward starting interest rate swaps - cash flow hedge 26 - - - Option and forward contracts -cash flow hedge - 14 - - Option and forward contracts - - 25 68 Other non-current assets: Cross-currency swaps - cash flow hedge 78 6 - - Interest rate swaps - fair value hedge 1 - - - Liability derivatives: Other current liabilities: Forward starting interest rate swaps - cash flow hedge (10) - - - Treasury lock- cash flow hedge (5) - - - Option and forward contracts -cash flow hedge - (1) - - Option and forward contracts - - (11) (53) Senior notes and loans: Interest rate swaps - fair value hedge (11) (43) - - |
Schedule of Accounts Receivable Securitization | As of and for the year ended December 31, 2015 2014 (U.S. $ in millions) Sold receivables at the beginning of the year $ 585 $ 590 Proceeds from sale of receivables 3,447 4,287 Cash collections (remitted to the owner of the receivables) (3,532) (4,202) Effect of currency exchange rate changes (55) (90) Sold receivables at the end of the year $ 445 $ 585 |
FINANCIAL EXPENSES NET (Tables)
FINANCIAL EXPENSES NET (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Financial Expenses Net Tables [Abstract] | |
Schedule of financial expenses | NOTE 17—FINANCIAL EXPENSES- NET: Year ended December, 31 2015 2014 2013 (U.S. $ in millions) Other-than-temporary impairment of securities $ 631 $ 6 $ - Interest expenses and other bank charges 270 300 314 Income from investments (34) (24) (32) Foreign exchange (gains) losses - net (9) 30 8 Other- mainly debt tender offer and termination of related swap agreements 142 1 109 Total finance expense — net $ 1,000 $ 313 $ 399 |
OTHER EXPENSES (Tables)
OTHER EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Restructuring And Impairment [Abstract] | |
Schedule Of Restructuring Reserve By Type Of Cost [TextBlock] | NOTE 18—OTHER EXPENSES: a. Impairments, restructuring and others: Impairments, restructuring and others consisted of the following: Year ended December 31, 2015 2014 2013 (U.S. $ in millions) Impairment of long-lived assets (see notes 6 and 8) $ 361 $ 387 $ 524 Contingent consideration (see note 3) 399 (20) 36 Acquisition costs 211 13 27 Restructuring 183 246 201 Other (23) 24 - Total $ 1,131 $ 650 $ 788 |
SEGMENTS (Tables)
SEGMENTS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting [Abstract] | |
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas [Table Text Block] | a. Segment information: Generics Specialty Year ended December 31, Year ended December 31, 2015 2014 2013 2015 2014 2013 (U.S.$ in millions) (U.S.$ in millions) Revenues $ 9,546 $ 9,814 $ 9,902 $ 8,338 $ 8,560 $ 8,388 Gross profit 4,499 4,253 4,083 7,200 7,457 7,274 R&D expenses 513 512 488 918 872 877 S&M expenses 1,304 1,575 1,915 1,921 1,990 1,856 Segment profit $ 2,682 $ 2,166 $ 1,680 $ 4,361 $ 4,595 $ 4,541 Year ended December 31, 2015 2014 2013 U.S.$ in millions Generic medicines profit $ 2,682 $ 2,166 $ 1,680 Specialty medicines profit 4,361 4,595 4,541 Total segment profit 7,043 6,761 6,221 Profit of other activities 318 226 243 Total profit 7,361 6,987 6,464 Amounts not allocated to segments: Amortization 838 1,036 1,180 General and administrative expenses 1,239 1,217 1,239 Legal settlements and loss contingencies 631 (111) 1,524 Impairments, restructuring and others 1,131 650 788 Other unallocated amounts 170 244 84 Consolidated operating income 3,352 3,951 1,649 Financial expenses - net 1,000 313 399 Consolidated income before income taxes $ 2,352 $ 3,638 $ 1,250 b. Segment revenues by geographic area: Year ended December 31, 2015 2014 2013 (U.S.$ in millions) Generic Medicines United States $ 4,793 $ 4,418 $ 4,172 Europe* 2,706 3,148 3,362 Rest of the World 2,047 2,248 2,368 Total Generic Medicines 9,546 9,814 9,902 Specialty Medicines United States 6,442 6,110 6,025 Europe* 1,518 1,898 1,854 Rest of the World 378 552 509 Total Specialty Medicines 8,338 8,560 8,388 Other Revenues United States 14 106 264 Europe* 666 777 772 Rest of the World 1,088 1,015 988 Total Other Revenues 1,768 1,898 2,024 Total Revenues $ 19,652 $ 20,272 $ 20,314 * All members of the European Union, Switzerland, Norway, Albania and the countries of former Yugoslavia. |
Schedule of net sales by product line | c. Net revenues from specialty medicines were as follows: Year ended December 31, 2015 2014 2013 (U.S. $ in millions) CNS $ 5,213 $ 5,575 $ 5,545 Copaxone® 4,023 4,237 4,328 Azilect® 384 428 371 Nuvigil® 373 388 320 Respiratory 1,129 957 964 ProAir® 549 478 429 Qvar® 392 286 328 Oncology 1,201 1,180 1,005 Treanda® 741 767 709 Women's health 461 504 510 Other Specialty 334 344 364 Total Specialty Medicines $ 8,338 $ 8,560 $ 8,388 |
Schedule of PPE by geographical area | e. Property, plant and equipment—by geographical location were as follows: December 31, 2015 2014 (U.S. $ in millions) Israel $ 2,159 $ 1,949 United States 629 691 Croatia 539 515 Hungary 506 520 Japan 415 446 Germany 332 367 Other 1,964 2,047 Total property, plant and equipment $ 6,544 $ 6,535 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share Tables [Abstract] | |
Schedule of earnings per share | NOTE 21—EARNINGS PER SHARE: The net income attributable to Teva and the weighted average number of ordinary shares used in computation of basic and diluted earnings per share for the years ended December 31, 2015, 2014 and 2013 are as follows: 2015 2014 2013 (U.S. $ in millions, except share data) Net income attributable to ordinary shareholders $ 1,573 $ 3,055 $ 1,269 + Interest expense on convertible senior debentures, and issuance costs , net of tax benefits - * * + Net income used for the computation of diluted earnings per share $ 1,573 $ 3,055 $ 1,269 |
Schedule of weighted average number of shares | Weighted average number of shares used in the computation of basic earnings per share 855 853 849 Add: Additional shares from the assumed exercise of employee stock options and unvested RSUs 5 3 1 Weighted average number of additional shares issued upon the assumed conversion of convertible senior debentures 4 2 * Weighted average number of shares used in the computation of diluted earnings per share 864 858 850 * Represents an amount less than 0.5 million. |
SCHEDULE II VALUATION AND QUA48
SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Schedule Of Valuation And Qualifying Accounts Tables [Abstract] | |
Schedule Of Valuation And Qualifying Accounts Disclosure Table [Text Block] | TEVA PHARMACEUTICAL INDUSTRIES LIMITED SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS Three Years Ended December 31, 2015 (U.S. $ in millions) Column A Column B Column C Column D Column E Balance at beginning of period Charged to costs and expenses Charged to other accounts Deductions Balance at end of period Allowance for doubtful accounts: Year ended December 31, 2015 $ 149 $ 18 $ (6) $ (15) $ 146 Year ended December 31, 2014 $ 187 $ 22 $ (18) $ (42) $ 149 Year ended December 31, 2013 $ 145 $ 44 $ 3 $ (5) $ 187 Allowance in respect of carryforward tax losses: Year ended December 31, 2015 $ 671 $ 249 $ 1 $ (161) $ 760 Year ended December 31, 2014 $ 791 $ 128 $ 0 $ (248) $ 671 Year ended December 31, 2013 $ 726 $ 182 $ 0 $ (117) $ 791 |
SIGNIFICANT ACCOUNTING POLICI49
SIGNIFICANT ACCOUNTING POLICIES (Details) $ in Millions | Dec. 31, 2015USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) |
Significant Accounting Policies [Abstract] | ||||
Percentage of consolidated sales in North America | 57.20% | |||
Shipping and handling costs, which are included in selling and marketing expenses | $ 127 | $ 151 | $ 232 | |
Advertising expense | 297 | 302 | 321 | |
Property Plant And Equipment [Line Items] | ||||
Other Revenue | 140 | $ 167 | $ 182 | |
Cash And Cash Equivalents And Marketable Securities Deposited In Banks And Financial Institutions | $ 8,400 | $ 8,400 | ||
Venezuel Acumulative Inflation Rate | 100.00% | 100.00% | ||
Building [Member] | ||||
Property Plant And Equipment [Line Items] | ||||
Property Plant And Equipment Useful Life Mainly | 40 | |||
Other Machinery And Equipment [Member] | Minimum [Member] | ||||
Property Plant And Equipment [Line Items] | ||||
Property Plant And Equipment Useful Life | 15 years 12 months 31 days | |||
Other Machinery And Equipment [Member] | Maximum [Member] | ||||
Property Plant And Equipment [Line Items] | ||||
Property Plant And Equipment Useful Life | 20 years 12 months 31 days | |||
Other Capitalized Property Plant And Equipment [Member] | Minimum [Member] | ||||
Property Plant And Equipment [Line Items] | ||||
Property Plant And Equipment Useful Life | 5 years 12 months 31 days | |||
Other Capitalized Property Plant And Equipment [Member] | Maximum [Member] | ||||
Property Plant And Equipment [Line Items] | ||||
Property Plant And Equipment Useful Life | 10 years 12 months 31 days |
CERTAIN TRANSACTIONS (Details)
CERTAIN TRANSACTIONS (Details) - USD ($) $ in Millions | May. 31, 2015 | Jul. 31, 2014 | Feb. 28, 2014 |
Noncash Or Part Noncash Acquisitions [Line Items] | |||
Business Acquisition Effective Date Of Acquisition1 | May 30, 2015 | Jul. 30, 2014 | Feb. 28, 2014 |
Labrys Biologics [Member] | |||
Noncash Or Part Noncash Acquisitions [Line Items] | |||
Total consideration | $ 207 | ||
Purchase price in US dollars | $ 207 |
CERTAIN TRANSACTIONS (Details 1
CERTAIN TRANSACTIONS (Details 1) - USD ($) shares in Millions, $ in Millions | Oct. 03, 2015 | Jul. 27, 2015 | May. 31, 2015 | Feb. 13, 2015 | Jul. 31, 2014 | Feb. 28, 2014 | Dec. 31, 2015 |
Business Acquisition [Line Items] | |||||||
Business Acquisition Effective Date Of Acquisition1 | May 30, 2015 | Jul. 30, 2014 | Feb. 28, 2014 | ||||
Business Acquisition Date Of Acquisition Agreement1 | Jan. 10, 2015 | Jul. 27, 2015 | Feb. 13, 2015 | ||||
Nu Pathe [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Business Acquisition Cost O fAcquired Entity Purchase Price | $ 163 | ||||||
potential additional payments of purchase price | $ 106 | ||||||
LabrysBiologics1 [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Business Combination Contingent Consideration Liability Fair Value | $ 251 | ||||||
potential additional payments of purchase price | $ 625 | ||||||
Rimsa [Member] | |||||||
BusinessCombinationConsiderationTransferredAbstract | |||||||
Purchase price in US dollars | $ 2,300 | ||||||
Actavis [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Business Acquisition Cost O fAcquired Entity Purchase Price | $ 40,500 | ||||||
BusinessCombinationConsiderationTransferredAbstract | |||||||
Purchase price in US dollars | 33,750 | ||||||
Issuance of shares and stock options in a business combinaiton transaction | $ 6,750 | ||||||
Shares issued as consideration for the acquisition | 100 | ||||||
Auspex [Member] | |||||||
BusinessCombinationConsiderationTransferredAbstract | |||||||
Purchase price in US dollars | $ 3,300 | ||||||
Immuneering Corporation And Microchips BiotechInc [Member] | |||||||
BusinessCombinationConsiderationTransferredAbstract | |||||||
Purchase price in US dollars | $ 102 |
CERTAIN TRANSACTIONS (Details 4
CERTAIN TRANSACTIONS (Details 4) - USD ($) $ in Millions | Dec. 31, 2015 | Sep. 25, 2015 | Dec. 31, 2013 | Dec. 31, 2015 | Nov. 30, 2014 | Dec. 31, 2012 |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Collaborative Arrangement Additional Milestone Payments Amount | $ 80 | $ 80 | ||||
LineOfCreditFacilityDescription | Teva reduced the amount of the bridge loan from $27 billion to $22 billion and entered into term facilities amounting to $5 billion with a syndicate of banks. The term facilities are split into two tranches of $2.5 billion each, with the first tranche maturing in full after three years and the second tranche maturing in five years with payment installments each year. To date, Teva has not drawn any funds under the bridge loan or the term facilities. | |||||
Xenon [Member] | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Collaborative Arrangement, Rights and Obligations | Under the agreement, Teva paid Xenon an upfront fee of $41 million. Dr. Michael Hayden, Teva’s President of Global R&D and Chief Scientific Officer, is the founder, a minority shareholder and a member of the board of directors of Xenon. In order to avoid potential conflicts of interest, Teva has established certain procedures to exclude Dr. Hayden from any involvement in Teva's decision-making related to Xenon. | |||||
Collaborative Arrangement Upfront Cash Payment | $ 10 | $ 41 | ||||
Collaborative Arrangement Additional Milestone Payments Amount | $ 335 | $ 335 | ||||
PGT [Member] | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Collaborative Arrangement, Rights and Obligations | Teva owns 49% of the joint venture, and P&G holds a controlling financial interest of 51%. The Company recognizes profits of the joint venture based on Teva's ownership percentage. | |||||
Eagle [Member] | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Collaborative Arrangement Upfront Cash Payment | 30 | $ 30 | ||||
Actavis Generics Finance [Member] | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
LineOfCreditFacilityIncreaseDecreaseForPeriodNet | 22 | $ 27 | ||||
First Milestone [Member] | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Collaborative Arrangement Additional Milestone Payments Amount | 15 | 15 | ||||
Additional Milestone [Member] | ||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||
Collaborative Arrangement Additional Milestone Payments Amount | $ 65 | $ 65 |
CERTAIN TRANSACTIONS (Details 6
CERTAIN TRANSACTIONS (Details 6) - Auspex [Member] $ in Millions | Dec. 31, 2015USD ($) |
Business Acquisition [Line Items] | |
Cash and cash equivalents | $ 201 |
Other current assets. | 6 |
Deferred Taxes And Other Assets | 126 |
Research and development in-process | 3,143 |
Goodwil Aacquired | 1,146 |
Total assets acquired | 4,622 |
Current Liabilities | 29 |
Deferred taxes | 1,131 |
Total liabilities assumed | 1,160 |
Net assets acquired | $ 3,462 |
CERTAIN TRANSACTIONS (Details 7
CERTAIN TRANSACTIONS (Details 7) € in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2015USD ($) | Dec. 31, 2015EUR (€) | Dec. 31, 2014USD ($) | |
Debt Instrument [Line Items] | |||
Principal amount currently outstanding on the debt instruments | $ 521 | $ 530 | |
Debt Instrument Repurchased Face Amount | 1,200 | ||
Repayments Of Debt | $ 1,300 | € 122 |
FAIR VALUE MEASUREMENT (Details
FAIR VALUE MEASUREMENT (Details) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Financial instruments carried at fair value [Line Items] | ||
Escrow fund | $ 125 | |
Total | $ 7,685 | 1,975 |
Options And Forward Contracts Derivative Liabilities [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Derivatives - Liabilities | 11 | 54 |
Asset Derivatives [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Derivatives - Asset | 25 | 82 |
ContingentConsiderationClassifiedAsAssetsOrLiabilitesFairValueDisclosure | (812) | (630) |
Level 1 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Escrow fund | 125 | |
Total | 8,309 | 2,490 |
Level 1 [Member] | Options And Forward Contracts Derivative Liabilities [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Derivatives - Liabilities | 0 | 0 |
Level 1 [Member] | Asset Derivatives [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Derivatives - Asset | 0 | 0 |
ContingentConsiderationClassifiedAsAssetsOrLiabilitesFairValueDisclosure | 0 | 0 |
Level 2 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Escrow fund | 0 | |
Total | 187 | 101 |
Level 2 [Member] | Options And Forward Contracts Derivative Liabilities [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Derivatives - Liabilities | 11 | 54 |
Level 2 [Member] | Asset Derivatives [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Derivatives - Asset | 25 | 82 |
ContingentConsiderationClassifiedAsAssetsOrLiabilitesFairValueDisclosure | 0 | 0 |
Level 3 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Escrow fund | 0 | |
Total | (811) | (616) |
Level 3 [Member] | Options And Forward Contracts Derivative Liabilities [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Derivatives - Liabilities | 0 | 0 |
Level 3 [Member] | Asset Derivatives [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Derivatives - Asset | 0 | 0 |
ContingentConsiderationClassifiedAsAssetsOrLiabilitesFairValueDisclosure | (812) | (630) |
Money Market Funds [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Cash And Cash Equivalents Fair Value Disclosure | 162 | 10 |
Money Market Funds [Member] | Level 1 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Cash And Cash Equivalents Fair Value Disclosure | 162 | 10 |
Money Market Funds [Member] | Level 2 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Cash And Cash Equivalents Fair Value Disclosure | 0 | 0 |
Money Market Funds [Member] | Level 3 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Cash And Cash Equivalents Fair Value Disclosure | 0 | 0 |
Demand Deposits [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Cash And Cash Equivalents Fair Value Disclosure | 6,784 | 2,216 |
Demand Deposits [Member] | Level 1 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Cash And Cash Equivalents Fair Value Disclosure | 6,784 | 2,216 |
Demand Deposits [Member] | Level 2 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Cash And Cash Equivalents Fair Value Disclosure | 0 | 0 |
Demand Deposits [Member] | Level 3 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Cash And Cash Equivalents Fair Value Disclosure | 0 | 0 |
Auction Rate Securities [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Investment in securities | 13 | |
Auction Rate Securities [Member] | Level 1 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Investment in securities | 0 | |
Auction Rate Securities [Member] | Level 2 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Investment in securities | 0 | |
Auction Rate Securities [Member] | Level 3 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Investment in securities | 13 | |
Structured Finance [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Investment in securities | 94 | 96 |
Structured Finance [Member] | Level 1 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Investment in securities | 0 | 0 |
Structured Finance [Member] | Level 2 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Investment in securities | 94 | 96 |
Structured Finance [Member] | Level 3 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Investment in securities | 0 | 0 |
Other Debt Obligations [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Investment in securities | 12 | 74 |
Other Debt Obligations [Member] | Level 1 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Investment in securities | 11 | 73 |
Other Debt Obligations [Member] | Level 2 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Investment in securities | 0 | 0 |
Other Debt Obligations [Member] | Level 3 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Investment in securities | 1 | 1 |
Interest Rate Swap [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Derivatives - Asset | 105 | 20 |
Interest Rate Swap [Member] | Level 1 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Derivatives - Asset | 0 | 0 |
Interest Rate Swap [Member] | Level 2 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Derivatives - Asset | 105 | 20 |
Interest Rate Swap [Member] | Level 3 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Derivatives - Asset | 0 | 0 |
Equity Securities [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Investment in securities | 1,352 | 66 |
Equity Securities [Member] | Level 1 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Investment in securities | 1,352 | 66 |
Equity Securities [Member] | Level 2 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Investment in securities | 0 | 0 |
Equity Securities [Member] | Level 3 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Investment in securities | 0 | 0 |
Cross Currency Interest Rate Contract [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Derivatives - Liabilities | 26 | 43 |
Cross Currency Interest Rate Contract [Member] | Level 1 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Derivatives - Liabilities | 0 | 0 |
Cross Currency Interest Rate Contract [Member] | Level 2 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Derivatives - Liabilities | 26 | 43 |
Cross Currency Interest Rate Contract [Member] | Level 3 [Member] | ||
Financial instruments carried at fair value [Line Items] | ||
Derivatives - Liabilities | $ 0 | $ 0 |
FAIR VALUE MEASUREMENT (Detai56
FAIR VALUE MEASUREMENT (Details 1) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Fair value of financial liabilities measured using Level 3 inputs | |||
Fair Value Measurement Asset Amount Realized | $ (13) | $ (5) | |
Other net change to fair value [Abstract] | |||
Carrying value | (811) | (616) | $ (347) |
Animal Health Unit [Member] | |||
Other net change to fair value [Abstract] | |||
Other net change to fair value - Included in earnings | 0 | 5 | |
Cephalon [Member] | |||
Changes in contingent consideration [Abstract] | |||
Changes in contingent consideration | 5 | 56 | |
Other net change to fair value [Abstract] | |||
Other net change to fair value - Included in earnings | 0 | (21) | |
Microdose [Member] | |||
Changes in contingent consideration [Abstract] | |||
Changes in contingent consideration | 10 | (83) | |
Nu Pathe [Member] | |||
Contingent consideration resulting from [Abstract] | |||
Contingent consideration resulting from | 0 | 83 | |
Changes in contingent consideration [Abstract] | |||
Changes in contingent consideration | 10 | 6 | |
Eagle Transaction [Member] | |||
Changes in contingent consideration [Abstract] | |||
Changes in contingent consideration | 63 | 0 | |
Other Transactions [Member] | |||
Changes in contingent consideration [Abstract] | |||
Changes in contingent consideration | 0 | (34) | |
Eagle [Member] | |||
Contingent consideration resulting from [Abstract] | |||
Contingent consideration resulting from | 128 | 0 | |
Labrys Transaction [Member] | |||
Contingent consideration resulting from [Abstract] | |||
Contingent consideration resulting from | 0 | 251 | |
Changes in contingent consideration [Abstract] | |||
Changes in contingent consideration | 311 | 1 | |
Other net change to fair value [Abstract] | |||
Other net change to fair value - Included in earnings | (350) | 0 | |
Gecko Transaction [Member] | |||
Contingent consideration resulting from [Abstract] | |||
Contingent consideration resulting from | $ 5 | $ 0 |
FAIR VALUE MEASUREMENT (Detai57
FAIR VALUE MEASUREMENT (Details 2) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Financial instrument measured on a basis other than fair value [Abstract] | ||
Fair value at the end of the period | $ (9,083) | $ (9,507) |
SeniorNotes And Convertible Senior Debentures [Member] | ||
Financial instrument measured on a basis other than fair value [Abstract] | ||
Fair value at the end of the period | (1,778) | (1,731) |
Senior Note Issues [Member] | ||
Financial instrument measured on a basis other than fair value [Abstract] | ||
Fair value at the end of the period | $ (7,305) | $ (7,776) |
INVESTMENT IN SECURITIES (Detai
INVESTMENT IN SECURITIES (Details) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 | Jun. 30, 2015 | Sep. 30, 2015 | Dec. 31, 2015 |
Marketable Securities [Abstract] | |||||
Available-for sale securities - Fair value | $ 1,620 | $ 259 | $ 1,620 | ||
Cost | 1,303 | 266 | 1,303 | ||
Gross unrealized holding gains | 338 | 19 | |||
Gross unrealized holding losses | 21 | 26 | |||
Available-for-sale securities by report caption | |||||
Available-for sale securitie | 1,620 | 259 | 1,620 | ||
Money Market Funds [Member] | |||||
Marketable Securities [Abstract] | |||||
Available-for sale securities - Fair value | 162 | 10 | 162 | ||
Available-for-sale securities by report caption | |||||
Available-for sale securitie | 162 | 10 | 162 | ||
Mylan Shares [Member] | |||||
Available-for-sale securities by report caption | |||||
Available For Sale Securities Gross Realized Gain Loss Net | $ 105 | $ 623 | 728 | ||
Available For Sale Equity Securities Gross Unrealized Gain | 312 | ||||
Deferred Taxes And Other Current Assets [Member] | |||||
Marketable Securities [Abstract] | |||||
Available-for sale securities - Fair value | 11 | 73 | 11 | ||
Available-for-sale securities by report caption | |||||
Available-for sale securitie | 11 | 73 | 11 | ||
Long Term Investments And Receivables [Member] | |||||
Marketable Securities [Abstract] | |||||
Available-for sale securities - Fair value | 1,447 | 176 | 1,447 | ||
Available-for-sale securities by report caption | |||||
Available-for sale securitie | $ 1,447 | $ 176 | $ 1,447 |
INVESTMENT IN SECURITIES (Det59
INVESTMENT IN SECURITIES (Details1) $ in Millions | Dec. 31, 2015USD ($) |
Contractual maturities of debt securities | |
2,015 | $ 173 |
2,016 | 0 |
2,017 | 0 |
2,018 | 0 |
2,019 | 95 |
2020 and thereafter | 0 |
Total maturities of available-for-sale securities, at fair value | $ 268 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Inventories [Abstract] | ||
Raw and packaging materials | $ 1,195 | $ 1,279 |
Products in process | 535 | 638 |
Finished products | 2,050 | 2,268 |
Materials in transit and payments on account | 186 | 186 |
Inventories | $ 3,966 | $ 4,371 |
PROPERTY, PLANT AND EQUIPMENT61
PROPERTY, PLANT AND EQUIPMENT (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Property Plant and Equipment Net [Abstract] | |||
Land owned or held under long-term leases | $ 394 | $ 372 | |
Buildings | 2,591 | 2,653 | |
Machinery and equipment | 5,071 | 4,893 | |
Computer equipment and other assets | 1,492 | 1,391 | |
Payments on account | 525 | 571 | |
Subtotal | 10,073 | 9,880 | |
Less-accumulated depreciation | 3,529 | 3,345 | |
Property, Plant and Equipment, Net, Total | 6,544 | 6,535 | |
Depreciation expense for the year | 449 | 464 | $ 458 |
Impairment charge during the year on property, plant and equipment | $ 96 | $ 163 | $ 61 |
Capitalized Land Lease Estimated Useful Lives Minimum | 30 | ||
Capitalized Land Lease Estimated Useful Lives Maximum | 99 |
GOODWILL DISCLOSURE (Details)
GOODWILL DISCLOSURE (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Goodwill Roll Forward [Line Items] | ||
Goodwill, balance as of January 1 | $ 18,408 | $ 18,981 |
Translation Differences And Other | (595) | (756) |
Goodwill acquired | 1,212 | 183 |
Goodwill, balance as of December 31 | 19,025 | 18,408 |
Generics [Member] | ||
Goodwill Roll Forward [Line Items] | ||
Goodwill, balance as of January 1 | 8,730 | 9,088 |
Translation Differences And Other | (265) | (358) |
Goodwill acquired | 0 | |
Goodwill, balance as of December 31 | 8,465 | 8,730 |
Specialty [Member] | ||
Goodwill Roll Forward [Line Items] | ||
Goodwill, balance as of January 1 | 8,502 | 8,668 |
Translation Differences And Other | (294) | (349) |
Goodwill acquired | 1,212 | 183 |
Goodwill, balance as of December 31 | 9,420 | 8,502 |
Other Good Will [Member] | ||
Goodwill Roll Forward [Line Items] | ||
Goodwill, balance as of January 1 | 1,176 | 1,225 |
Translation Differences And Other | (36) | (49) |
Goodwill acquired | 0 | |
Goodwill, balance as of December 31 | $ 1,140 | $ 1,176 |
IDENTIFIABLE INTANGIBLE ASSET63
IDENTIFIABLE INTANGIBLE ASSET (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Intangible Assets [Abstract] | |||
Product rights, at cost | $ 9,047 | $ 9,606 | |
Finite Lived Trade Names Gross | 212 | 243 | |
Research and development in process gross | 4,332 | 1,060 | |
Intangible assets, gross, excluding goodwill | 13,591 | 10,909 | |
Product rights, accumulated amortization | 5,876 | 5,343 | |
Finite Lived Trade Names Accumulated Amortization | 40 | 54 | |
Intangible assets accumulated amortization | 5,916 | 5,397 | |
Products rights net | 3,171 | 4,263 | |
Trade Names Net | 172 | 189 | |
Research and development in process net | 4,332 | 1,060 | |
Intangible assets, net (excluding goodwill) total | 7,675 | 5,512 | |
Intangible assets charges against earnings | |||
Amortization Of Intangible Assets | 838 | 1,036 | $ 1,180 |
Impairment of intangible assets | 265 | 224 | $ 393 |
Estimated aggregate amortization of intangible assets | |||
2,014 | 584 | ||
2,015 | 521 | ||
2,016 | 518 | ||
2,017 | 430 | ||
2,018 | 368 | ||
AcquiredIndefiniteLivedIntangibleAssetsLineItems | |||
Research and development in process net | 4,332 | $ 1,060 | |
Revascor Cephalon [Member] | |||
Intangible Assets [Abstract] | |||
Research and development in process net | 258 | ||
AcquiredIndefiniteLivedIntangibleAssetsLineItems | |||
Research and development in process net | 258 | ||
Cinquil Cephalon [Member] | |||
Intangible Assets [Abstract] | |||
Research and development in process net | 215 | ||
AcquiredIndefiniteLivedIntangibleAssetsLineItems | |||
Research and development in process net | 215 | ||
Lama Laba Microdose [Member] | |||
Intangible Assets [Abstract] | |||
Research and development in process net | 62 | ||
AcquiredIndefiniteLivedIntangibleAssetsLineItems | |||
Research and development in process net | 62 | ||
Labrys [Member] | |||
Intangible Assets [Abstract] | |||
Research and development in process net | 444 | ||
AcquiredIndefiniteLivedIntangibleAssetsLineItems | |||
Research and development in process net | 444 | ||
Auspex [Member] | |||
Intangible Assets [Abstract] | |||
Research and development in process net | 3,143 | ||
AcquiredIndefiniteLivedIntangibleAssetsLineItems | |||
Research and development in process net | 3,143 | ||
Immuneering [Member] | |||
Intangible Assets [Abstract] | |||
Research and development in process net | 87 | ||
AcquiredIndefiniteLivedIntangibleAssetsLineItems | |||
Research and development in process net | 87 | ||
Microchips [Member] | |||
Intangible Assets [Abstract] | |||
Research and development in process net | 76 | ||
AcquiredIndefiniteLivedIntangibleAssetsLineItems | |||
Research and development in process net | 76 | ||
TD Hydrocodone Cephalon [Member] | |||
Intangible Assets [Abstract] | |||
Research and development in process net | 47 | ||
AcquiredIndefiniteLivedIntangibleAssetsLineItems | |||
Research and development in process net | $ 47 |
SALES RESEARVES AND ALLOWANCES
SALES RESEARVES AND ALLOWANCES (Details) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Sales Researves And Allowancess [Abstract] | ||
Sales Reserves And Allowances | $ 6,601 | $ 5,849 |
Medicaid | 1,319 | 1,099 |
Rebates | 3,382 | 2,842 |
Chargebacks | 1,091 | 1,129 |
Returns | 598 | 593 |
Other | $ 211 | $ 186 |
LONG TERM EMPLOYEE RELATED OB65
LONG TERM EMPLOYEE RELATED OBLIGATIONS (Details) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Employee-related obligations long-term | ||
Accrued severance pay | $ 123 | $ 146 |
Defined benefit plans | 157 | 188 |
Total | 280 | 334 |
Employee-related obligations information | ||
Long-term investments earmarked for severance pay liabilities in Israel | 140 | $ 146 |
Expected contributions to the pension funds | 126 | |
Future minimum benefit payments | ||
2,015 | 8 | |
2,016 | 7 | |
2,017 | 11 | |
2,018 | 11 | |
2,019 | 8 | |
2020-2024 | $ 50 |
DEBT OBLIGATIONS (Details)
DEBT OBLIGATIONS (Details) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Maturities Of Long Term Debt [Abstract] | ||
2,017 | $ 544 | |
2,018 | 760 | |
2,019 | 1,382 | |
2,020 | 700 | |
2021 and thereafter | 4,997 | |
Total Long Term Debt Maturities Repayments Of Principal | $ 8,383 | $ 8,566 |
DEBT OBLIGATIONS (Details 1)
DEBT OBLIGATIONS (Details 1) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Debt Instrument [Line Items] | ||
Debt Instrument Basis Spread On Variable Rate | 1.00% | |
Debt Instrument Maturity Date | Jan. 1, 2026 | |
SeniorNotes | $ 8,178 | $ 8,292 |
Term Loans | 1,163 | 1,401 |
Long Term Debentures | 20 | 15 |
Less current maturities | 989 | 1,185 |
Derivative Instruments | 11 | 43 |
Total Long Term Debt Maturities Repayments Of Principal | $ 8,383 | 8,566 |
Subsidiary Senior Notes Due 2015 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument effective interest rate percentage at period end | 3.00% | |
Debt Instrument Description Of Variable Rate Basis | Senior notes USD 1,000 million (3) | |
SeniorNotes | $ 0 | 1,000 |
Subsidiary Senior Notes Due 2016 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument effective interest rate percentage at period end | 2.40% | |
Debt Instrument Description Of Variable Rate Basis | Senior notes USD 950 million | |
SeniorNotes | $ 950 | 950 |
Subsidiary Senior Notes Due 2021 One [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument effective interest rate percentage at period end | 3.65% | |
Debt Instrument Description Of Variable Rate Basis | Senior notes USD 613 million (1) | |
SeniorNotes | $ 611 | 873 |
Subsidiary Senior Notes Due 2021 Two [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument effective interest rate percentage at period end | 3.65% | |
Debt Instrument Description Of Variable Rate Basis | Senior notes USD 588 million (1) | |
SeniorNotes | $ 586 | 873 |
Subsidiary Senior Notes Due 2018 One [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument effective interest rate percentage at period end | 1.50% | |
Debt Instrument Description Of Variable Rate Basis | Senior notes CHF 450 million | |
SeniorNotes | $ 455 | 455 |
Term Loans | 293 | |
Subsidiary Senior Notes Due 2019 One [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument effective interest rate percentage at period end | 2.88% | |
Debt Instrument Description Of Variable Rate Basis | Senior notes EUR 1,000 million | |
SeniorNotes | $ 1,092 | 1,213 |
Subsidiary Senior Notes Due 2020 One [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument effective interest rate percentage at period end | 2.25% | |
Debt Instrument Description Of Variable Rate Basis | Senior notes USD 700 million | |
SeniorNotes | $ 700 | 700 |
Subsidiary Senior Notes Due 2022 One [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument effective interest rate percentage at period end | 2.95% | |
Debt Instrument Description Of Variable Rate Basis | Senior notes USD 844 million (1) | |
SeniorNotes | $ 843 | 1,297 |
Subsidiary Senior Notes Due 2023 One [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument effective interest rate percentage at period end | 1.25% | |
Debt Instrument Description Of Variable Rate Basis | Senior notes EUR 1,300 million (2) | |
SeniorNotes | $ 1,409 | 0 |
Subsidiary Senior Notes Due 2027 One [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument effective interest rate percentage at period end | 1.88% | |
Debt Instrument Description Of Variable Rate Basis | Senior notes EUR 700 million (2) | |
SeniorNotes | $ 762 | 0 |
Subsidiary Senior Notes Due 2036 One [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument effective interest rate percentage at period end | 6.15% | |
Debt Instrument Description Of Variable Rate Basis | Senior notes USD 789 million (1) | |
SeniorNotes | $ 780 | 974 |
Hedge Accounting Adjustments [Member] | ||
Debt Instrument [Line Items] | ||
SeniorNotes | $ (10) | (43) |
Long Credit Agreement 2015 [Member] | ||
Debt Instrument [Line Items] | ||
Debt Instrument Description Of Variable Rate Basis | Term loan EUR 122 million (4) | |
Term Loans | $ 0 | 148 |
Long Credit Agreement 2017 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument effective interest rate percentage at period end | 0.99% | |
Debt Instrument Description Of Variable Rate Basis | Term loan JPY 65 billion | |
Term Loans | $ 544 | 549 |
Long Credit Agreement 2018 [Member] | ||
Debt Instrument [Line Items] | ||
Debt Instrument Description Of Variable Rate Basis | Term loan JPY 35 billion | |
Debt Instrument Basis Spread On Variable Rate | 0.30% | |
Term Loans | $ 290 | |
Long Credit Agreement 2019 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument effective interest rate percentage at period end | 1.42% | |
Debt Instrument Description Of Variable Rate Basis | Term loan JPY 35 billion | |
Term Loans | $ 290 | 293 |
Long Credit Agreement 2019 Two [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument effective interest rate percentage at period end | 1.67% | |
Debt Instrument Description Of Variable Rate Basis | Other loans JPY 5 billion (5) | |
Term Loans | $ 39 | 118 |
Long Term Debentures 2018 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument effective interest rate percentage at period end | 7.20% | |
Long Term Debentures | $ 15 | 15 |
Other Debentures [Member] | ||
Debt Instrument [Line Items] | ||
Long Term Debentures | $ 5 | $ 0 |
DEBT OBLIGATIONS (Details 2)
DEBT OBLIGATIONS (Details 2) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Debt Current | ||
Bank and financial institutions | $ 75 | $ 46 |
Principal amount currently outstanding on the debt instruments | 521 | 530 |
Current maturities of long term liabilities | 989 | 1,185 |
Debt, Current, Total | $ 1,585 | $ 1,761 |
Debt Current Additional Information | ||
Debt Instrument Maturity Date | Jan. 1, 2026 | |
Notes Payable To Banks [Member] | ||
Debt Current Additional Information | ||
Weighted average interest rate | 2.05% | |
Convertible Debt [Member] | ||
Debt Current Additional Information | ||
Weighted average interest rate | 0.25% |
DEBT OBLIGATIONS (Details 3)
DEBT OBLIGATIONS (Details 3) € in Millions, $ in Millions | Dec. 31, 2015USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2015EUR (€) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Nov. 30, 2015USD ($) |
Senior Notes And Loans [Line Items] | ||||||
Repayments Of Debt | $ 1,300 | € 122 | ||||
Debt Instrument Repurchased Face Amount | $ 1,200 | 1,200 | ||||
Nonoperating Income Expense | (1,000) | $ (313) | $ (399) | |||
Proceeds From Issuance Of Senior Long Term Debt | € | € 2,000 | |||||
Debt Instrument Maturity Date | Jan. 1, 2026 | |||||
Line Of Credit Facility | $ 4,500 | 4,500 | $ 3,000 | |||
Senior Notes Two Point Ninety Five Percent Maturing 2022 [Member] | ||||||
Senior Notes And Loans [Line Items] | ||||||
Debt Instrument Repurchased Face Amount | $ 456 | $ 456 | ||||
Debt instrument effective interest rate percentage at period end | 2.95% | 2.95% | ||||
Debt Instrument Maturity Year. | 2,022 | 2,022 | ||||
Senior Notes Three Point Sixty Five Percent Maturing 2021 [Member] | ||||||
Senior Notes And Loans [Line Items] | ||||||
Debt Instrument Repurchased Face Amount | $ 287 | $ 287 | ||||
Debt instrument effective interest rate percentage at period end | 3.65% | 3.65% | ||||
Debt Instrument Maturity Year. | 2,021 | 2,021 | ||||
Senior Notes One Point Twenty Five Percent Due March 2023 [Member] | ||||||
Senior Notes And Loans [Line Items] | ||||||
Debt instrument effective interest rate percentage at period end | 1.25% | 1.25% | ||||
Proceeds From Issuance Of Senior Long Term Debt | € | € 1,300 | |||||
Debt Instrument Maturity Date | Mar. 31, 2023 | Mar. 31, 2023 | ||||
Senior Notes One Point Eight Seven Five Percent Due March 2027 [Member] | ||||||
Senior Notes And Loans [Line Items] | ||||||
Debt instrument effective interest rate percentage at period end | 1.88% | 1.88% | ||||
Proceeds From Issuance Of Senior Long Term Debt | € | € 700 | |||||
Debt Instrument Maturity Date | Mar. 31, 2027 | Mar. 31, 2027 | ||||
Senior Notes Three Percent Maturing June 2015 [Member] | ||||||
Senior Notes And Loans [Line Items] | ||||||
Repayments Of Debt | $ 1,000 | |||||
Debt instrument effective interest rate percentage at period end | 3.00% | 3.00% | ||||
Debt Instrument Maturity Date | Jun. 30, 2015 | Jun. 30, 2015 | ||||
Us Dolllar [Member] | ||||||
Senior Notes And Loans [Line Items] | ||||||
LT Debt Cross Currency Swap | 35.00% | 35.00% | ||||
Euro [Member] | ||||||
Senior Notes And Loans [Line Items] | ||||||
LT Debt Cross Currency Swap | 46.00% | 46.00% | ||||
JPY [Member] | ||||||
Senior Notes And Loans [Line Items] | ||||||
LT Debt Cross Currency Swap | 14.00% | 14.00% | ||||
Swiss Franc [Member] | ||||||
Senior Notes And Loans [Line Items] | ||||||
LT Debt Cross Currency Swap | 5.00% | 5.00% |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - Teva And Subsidiaries [Member] | 12 Months Ended |
Dec. 31, 2015 | |
Approximate number of product liability cases | 4,000 |
Approximate number of pending cases | 500 |
Approximate Number Of Plaintiffs Claiming Injuries | 4,400 |
Teva Parental Medicines Inc [Member] | |
Parties To Tort Proceeding Cases Against Teva In Philadelphia Court | 40 |
EQUITY (Details)
EQUITY (Details) $ / shares in Units, $ in Millions | Jan. 06, 2016USD ($) | Dec. 31, 2015USD ($)$ / sharesshares | Dec. 31, 2014USD ($)$ / sharesshares | Dec. 31, 2013USD ($)$ / sharesshares | Dec. 31, 2015₪ / shares | Oct. 02, 2014USD ($) |
Common stock | ||||||
Ordinary shares, issued | shares | 1,016,000,000 | 957,000,000 | ||||
Purchase of treasury shares | $ 439 | $ 500 | $ 497 | |||
Treasury Stock Shares Acquired | shares | 7,700,000 | 8,700,000 | 12,800,000 | |||
Stock Repurchase Program, Authorized Amount | $ 2,100 | $ 3,000 | ||||
Ordinary shares price per share | ₪ / shares | ₪ 0.10 | |||||
Proceeds from issuance of mandatory convertible preferred shares, net of issuance costs ADSs | $ 329 | $ 3,291 | ||||
Aggregate Proceeds From Issuance Of Preferred Stock And Preference Stock | $ 3,620 | |||||
Shares Held In Employee Stock Option Plan Committed To Be Released | shares | 12,200,000 | |||||
Convertible Preferred Stock Terms Of Conversion | 13.3333 and 16.0000 | |||||
Convertible Preferred Stock Shares Issued Upon Conversion | shares | 337,500 | |||||
Preferred Stock Dividend Rate Per Dollar Amount | $ / shares | $ 1,000 | |||||
Share Price | $ / shares | $ 62.5 | |||||
Treasury stock | ||||||
Treasury stock, value | $ (439) | $ (500) | $ (497) | |||
Retained earnings | ||||||
Dividends declared and paid | $ / shares | $ 1.36 | $ 1.34 | $ 1.28 | |||
Additional dividends declared | $ / shares | $ 0.34 | |||||
Other Comprehensive Income (Loss) Net Of Tax [Abstract] | ||||||
Currency translation adjustment, net of tax | $ (2,384) | $ (1,283) | $ 151 | |||
Unrealized gain (loss) from available-for-sale securities, net of tax | 312 | (7) | 5 | |||
Unrealized loss from cash flow hedge | 175 | 40 | (197) | |||
Accumulatedothercomprehensiveincomelossotheradjustments | (58) | (93) | (50) | |||
Comprehensive income attributable to Teva | $ (1,955) | $ (1,343) | $ (91) |
EQUITY (Details 1)
EQUITY (Details 1) | 12 Months Ended |
Dec. 31, 2015 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
ShareBasedCompensationArrangementByShareBasedPaymentAwardAwardVestingRights | The vesting period of the outstanding options, RSUs and PSUs is generally 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 plan described above. |
EQUITY (Details 2)
EQUITY (Details 2) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Roll Forward | ||||
Options granted WA fair value | $ 10.9 | $ 9.3 | $ 6.6 | |
Share Based Compensation Arrangement By Share Based Payment Award Fair Value Assumptions And Methodology Abstract | ||||
Dividend yield | 2.30% | 2.90% | 3.30% | |
Expected volatility | 24.00% | 25.00% | 23.00% | |
Risk-free interest rate (in dollar terms) | 1.80% | 1.90% | 2.10% | |
Sharebased Compensation Arrangement By Sharebased Payment Award Fair Value Assumptions Expected Term1 | 5 years 12 months 31 days | 6 years 12 months 31 days | 9 years 12 months 31 days | |
Share Based Compensation Arrangement By Share Based Payment Award Options Additional Disclosures Abstract | ||||
Closing stock price | $ 65.64 | |||
The total number of exercisable options that are in-the-money as of December 31, 2010 | 3,400 | |||
The total intrinsic value of options exercised during the years | $ 120 | $ 74 | $ 19 | |
Average market price of Teva's ordinary shares during the year | $ 61.66 | $ 51.57 | $ 38.99 | |
Share Based Compensation Arrangement By Share Based Payment Award Equity Instruments Other Than Options Nonvested [Roll Forward] | ||||
Employee Service Share Based Compensation Nonvested Award Total Compensation Cost Not Yet Recognized Period For Recognition R S Us | 1.4 | |||
Employee Service Share Based Compensation Nonvested Award Total Compensation Cost Not Yet Recognized Period For Recognition Stock Option | 1.4 | |||
Stock Options Plan [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Roll Forward | ||||
Balance outstanding at beginning of year | 26,733 | 32,481 | 36,580 | |
Granted | 7,655 | 6,935 | 1,701 | |
Exercise of options by employees and vested RSUs, shares | (8,127) | (11,423) | (2,797) | |
Forfeited | 1,028 | 1,260 | 3,003 | |
Balance outstanding at end of year | 25,233 | 26,733 | 32,481 | |
Weighted average exercise price | $ 49.69 | $ 45.91 | $ 45.05 | $ 44.40 |
Share Based Compensation Arrangement By Share Based Payment Award Fair Value Assumptions And Methodology Abstract | ||||
Options exercisable at end of year | 11,299 | 12,632 | 17,082 | |
Share Based Compensation Arrangement By Share Based Payment Award Options Additional Disclosures Abstract | ||||
Weighted average exercise price | $ 44.67 | $ 47.16 | $ 47.30 | |
The total unrecognized compensation cost before tax on employee stock options and RSUs | $ 98 | |||
Share Based Compensation Arrangement By Share Based Payment Award Equity Instruments Other Than Options Nonvested [Roll Forward] | ||||
Granted | $ 59.82 | 48.60 | 38.37 | |
Vested | 46.88 | 45.05 | 32.17 | |
Forfeited | $ 48.96 | $ 46.11 | $ 45.51 | |
The total unrecognized compensation cost before tax on employee stock options and RSUs | $ 98 | |||
Employee Service Share Based Compensation Aggregate Disclosures Abstract | ||||
Restricted stock units RSUs | 62 | $ 47 | $ 40 | |
Restricted Stock Units [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award Options Additional Disclosures Abstract | ||||
The total unrecognized compensation cost before tax on employee stock options and RSUs | $ 96 | |||
Share Based Compensation Arrangement By Share Based Payment Award Equity Instruments Other Than Options Nonvested [Roll Forward] | ||||
RSUs outstanding at beginning of year | 2,466,000 | 2,512,000 | 3,744,000 | |
Granted | 1,519,000 | 1,342,000 | 289,000 | |
Vested | 1,112,000 | 1,146,000 | 1,222,000 | |
Forfeited | 322,000 | 242,000 | 299,000 | |
RSUs outstanding at end of year | 2,551,000 | 2,466,000 | 2,512,000 | |
Weighted-average grant date fair value per share - RSUs at beginning of year | $ 43.05 | $ 40.48 | $ 41.04 | |
Granted | 56.75 | 46.09 | 35.80 | |
Vested | 41.04 | 41.55 | 41.04 | |
Forfeited | 48.27 | 40.05 | 40.98 | |
Weighted-average grant date fair value per share - RSUs at end of year | $ 51.43 | $ 43.05 | $ 40.48 | |
The total unrecognized compensation cost before tax on employee stock options and RSUs | $ 96 | |||
Employee Service Share Based Compensation Aggregate Disclosures Abstract | ||||
Restricted stock units RSUs | 55 | $ 38 | $ 24 | |
Omnibus Long Term Share Incentive Plan [Member] | ||||
Employee Service Share Based Compensation Aggregate Disclosures Abstract | ||||
Restricted stock units RSUs | 117 | 85 | 64 | |
Tax effect on stock-based compensation expense | 19 | 14 | 14 | |
Net effect | $ 98 | $ 71 | $ 50 |
EQUITY (Details 3)
EQUITY (Details 3) $ / shares in Units, shares in Thousands, $ in Thousands | Dec. 31, 2015USD ($)$ / sharesshares |
Number of ordinary shares issuable upon exercise of outstanding options | |
Number of shares | shares | 25,233 |
Weighted average exercise price | $ / shares | $ 49.69 |
Weighted average remaining life | 7.19 |
Aggregate intrinsic value | $ | $ 402,420 |
Number of ordinary shares issuable upon exercise of vested options | |
Number of shares | shares | 11,299 |
Weighted average exercise price | $ / shares | $ 44.67 |
Weighted average remaining life | 5.44 |
Aggregate intrinsic value | $ | $ 236,898 |
Exercise Price Range One [Member] | |
Number of ordinary shares issuable upon exercise of vested options | |
Number of shares | shares | 189 |
Weighted average exercise price | $ / shares | $ 59.58 |
Weighted average remaining life | 1.67 |
Aggregate intrinsic value | $ | $ 1,147 |
Exercise Price Range Three [Member] | |
Number of ordinary shares issuable upon exercise of outstanding options | |
Number of shares | shares | 3,398 |
Weighted average exercise price | $ / shares | $ 38.61 |
Weighted average remaining life | 7.10 |
Aggregate intrinsic value | $ | $ 91,858 |
Exercise Price Range Four [Member] | |
Number of ordinary shares issuable upon exercise of outstanding options | |
Number of shares | shares | 4,707 |
Weighted average exercise price | $ / shares | $ 41.93 |
Weighted average remaining life | 6.09 |
Aggregate intrinsic value | $ | $ 111,613 |
Number of ordinary shares issuable upon exercise of vested options | |
Number of shares | shares | 2,741 |
Weighted average exercise price | $ / shares | $ 38.74 |
Weighted average remaining life | 7.02 |
Aggregate intrinsic value | $ | $ 73,742 |
Exercise Price Range Five [Member] | |
Number of ordinary shares issuable upon exercise of outstanding options | |
Number of shares | shares | 7,533 |
Weighted average exercise price | $ / shares | $ 48.55 |
Weighted average remaining life | 7.33 |
Aggregate intrinsic value | $ | $ 128,738 |
Number of ordinary shares issuable upon exercise of vested options | |
Number of shares | shares | 3,830 |
Weighted average exercise price | $ / shares | $ 41.83 |
Weighted average remaining life | 5.87 |
Aggregate intrinsic value | $ | $ 91,203 |
Exercise Price Range Six [Member] | |
Number of ordinary shares issuable upon exercise of outstanding options | |
Number of shares | shares | 1,881 |
Weighted average exercise price | $ / shares | $ 52.18 |
Weighted average remaining life | 2.20 |
Aggregate intrinsic value | $ | $ 25,323 |
Number of ordinary shares issuable upon exercise of vested options | |
Number of shares | shares | 2,732 |
Weighted average exercise price | $ / shares | $ 48.42 |
Weighted average remaining life | 5.97 |
Aggregate intrinsic value | $ | $ 47,054 |
Exercise Price Range Seven [Member] | |
Number of ordinary shares issuable upon exercise of outstanding options | |
Number of shares | shares | 1,434 |
Weighted average exercise price | $ / shares | $ 57.85 |
Weighted average remaining life | 8.22 |
Aggregate intrinsic value | $ | $ 11,173 |
Number of ordinary shares issuable upon exercise of vested options | |
Number of shares | shares | 1,747 |
Weighted average exercise price | $ / shares | $ 52.12 |
Weighted average remaining life | 1.72 |
Aggregate intrinsic value | $ | $ 23,616 |
Exercise Price Range Eight [Member] | |
Number of ordinary shares issuable upon exercise of outstanding options | |
Number of shares | shares | 6,280 |
Weighted average exercise price | $ / shares | $ 60.27 |
Weighted average remaining life | 9.14 |
Aggregate intrinsic value | $ | $ 33,715 |
Number of ordinary shares issuable upon exercise of vested options | |
Number of shares | shares | 60 |
Weighted average exercise price | $ / shares | $ 63.32 |
Weighted average remaining life | 1.27 |
Aggregate intrinsic value | $ | $ 136 |
EQUITY (Details 4)
EQUITY (Details 4) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Currency translation adjustment [Abstract] | |||
Other comprehensive income (loss) before reclassifications, currency translation adjustments | $ (1,131) | $ (1,429) | $ (46) |
Amounts reclassified from accumulated other comprehensive loss before tax, currency translation adjustments | 24 | (5) | 17 |
Net other comprehensive income (loss) before tax, currency translation adjustments | (1,107) | (1,434) | (29) |
Income tax related to items of other comprehensive income (loss), currency translation adjustments | 6 | 0 | 5 |
Net other comprehensive income (loss) after tax, currency translation adjustment | (1,101) | (1,434) | (24) |
Unrealized gain (loss) from available-for-sale securities | |||
Other comprehensive income (loss) before reclassifications, available-for-sale-securities | (413) | (12) | 18 |
Gains on marketable securities, included in financial expenses - net | 737 | 2 | (6) |
Net other comprehensive income (loss) before tax, available-for-sale-securities | 324 | (10) | 12 |
Income tax related to items of other comprehensive income (loss), available-for-sale-securities | (5) | (2) | 0 |
Net other comprehensive income (loss) after tax, available-for-sale-securities | 319 | (12) | 12 |
Unrealized gain (loss) on derivative financial instruments | |||
Other comprehensive income (loss) before reclassifications, cash flow hedges | 137 | 240 | (111) |
Loss on derivative financial instruments, included in net revenues | (2) | (3) | 7 |
Net other comprehensive income (loss) before tax, cash flow hedges | 135 | 237 | (104) |
Income tax related to items of other comprehensive income (loss), cash flow hedges | 0 | 0 | 0 |
Net other comprehensive income (loss) after tax, cash flow hedges | 135 | 237 | (104) |
Defined benefit plan items | |||
Other comprehensive income (loss) before reclassifications, defined benefit plan | 33 | (55) | 20 |
Loss on defined benefit plans, included in various statement of income items | 4 | (2) | 24 |
Net other comprehensive income (loss) before tax, defined benefit plan | (37) | 57 | (44) |
Income tax related to items of other comprehensive income (loss), defined benefit plan | 2 | (14) | 2 |
Net other comprehensive income (loss) after tax, defined benefit plan | (35) | 43 | (42) |
Other comprehensive income (loss) before reclassifications | (1,374) | (1,256) | (119) |
Amounts reclassified from accumulated other comprehensive loss before tax: | |||
Amounts reclassified from accumulated other comprehensive loss before tax, currency translation adjustments | 24 | (5) | 17 |
Gains on marketable securities, included in financial expenses - net | 737 | 2 | (6) |
Loss on derivative financial instruments, included in net revenues | (2) | (3) | 7 |
Loss on defined benefit plans, included in various statement of income items | 4 | (2) | 24 |
Amounts reclassified from accumulated other comprehensive loss before tax | 763 | (8) | 42 |
Net other comprehensive income (loss) before tax | (611) | (1,264) | (77) |
Income tax related to items of other comprehensive income (loss) | (1) | 12 | 3 |
Net other comprehensive income (loss) after tax | $ (612) | $ (1,252) | $ (74) |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Income Loss From Continuing Operations Before Income Taxes Minority Interest And Income Loss From Equity Method Investments | ||||||
The Company and its Israeli subsidiaries | $ 1,932 | $ 2,139 | $ 1,303 | |||
Non-Israeli subsidiaries | 420 | 1,499 | (53) | |||
Income before income taxes | 2,352 | 3,638 | 1,250 | |||
UTP Due To NOLs ST | $ 108 | $ 143 | 108 | 143 | ||
UTP Due To NOLs LT | 70 | 150 | 70 | 150 | ||
Income Tax Expense Benefit Continuing Operations By Jurisdiction | ||||||
In Israel | 149 | 147 | 197 | |||
Outside Israel | 485 | 444 | (240) | |||
Income Tax Expense (Benefit), Total | 634 | 591 | (43) | |||
Federal Income Tax Expense Benefit Continuing Operations | ||||||
Current | 298 | 879 | 1,096 | |||
Deferred income taxes-net and uncertain tax positions | 336 | (288) | (1,139) | |||
Income taxes | $ 634 | $ 591 | $ (43) | |||
Effective Income Tax Rate Reconciliation | ||||||
Statutory tax rate in Israel | 26.50% | 26.50% | 25.00% | |||
Amendment Sixty Nine Payments | $ 286 | $ 577 | ||||
Short-term deferred tax assets (liabilities)-net: | ||||||
Inventory related | 382 | 383 | 382 | $ 383 | ||
Sales reserves and allowances | 254 | 357 | 254 | 357 | ||
Provisions for employee-related obligations, current | 45 | 66 | 45 | 66 | ||
Carryforward losses and deductions, current | 60 | 59 | 60 | 59 | ||
Provision for legal settlements | 89 | 229 | 89 | 229 | ||
Other | 64 | 78 | 64 | 78 | ||
Short-term deferred tax assets (liabilities)-gross | 894 | 1,172 | 894 | 1,172 | ||
Valuation allowance-in respect of carryforward losses and deductions that may not be utilized | (190) | (213) | (190) | (213) | ||
Short-term deferred tax assets (liabilities)-net | 704 | 959 | 704 | 959 | ||
Long-term deferred tax assets (liabilities)-net: | ||||||
Deferred Tax Liabilities Property Plant And Equipment | (207) | (218) | (207) | (218) | ||
Intangible assets | (1,900) | (1,098) | (1,900) | (1,098) | ||
Provisions for employee related obligations, noncurrent | 65 | 39 | 65 | 39 | ||
Carryforward losses and deductions, noncurrent | 989 | 1,043 | 989 | 1,043 | ||
Other | 125 | (21) | 125 | (21) | ||
Long-term deferred tax assets (liabilities)-gross | (928) | (255) | (928) | (255) | ||
Deferred Tax Assets Valuation Allowance Noncurrent | (570) | (458) | (570) | (458) | ||
Long-term deferred tax assets (liabilities)-net | (1,498) | (713) | (1,498) | (713) | ||
Deferred tax assets (liabilities) - net | 794 | 246 | 794 | 246 | ||
Uncertain Tax Positions Due To NOLs | 178 | 293 | 178 | 293 | ||
Reconciliation Of Unrecognized Tax Benefits Excluding Amounts Pertaining To Examined Tax Returns Roll Forward | ||||||
Balance at the beginning of the year | 713 | 665 | 903 | |||
Increase related to prior year tax positions, net | (6) | 38 | 29 | |||
Increase related to current year tax positions | 43 | 51 | 176 | |||
Tax assessments settlements | (99) | (38) | (461) | |||
Acquisition | 0 | 0 | 0 | |||
Other | (3) | (3) | 18 | |||
Balance at the end of the year | 648 | 713 | $ 665 | 648 | 713 | 665 |
Future Federal Statutory Tax Rate | ||||||
Unrecognized Tax Benefits Income Tax Penalties And Interest Expense | 14 | 12 | 69 | |||
Balance of accrued potential penalties and interest in unrecognized tax benefits | 101 | 87 | 75 | 101 | 87 | 75 |
Income Tax Contingency [Line Items] | ||||||
Unrecognized Tax Benefits Income Tax Penalties And Interest Expense | $ 14 | $ 12 | $ 69 | |||
Amount Of Tax Exempt Profit Earned By Company From Approved Enterprises | 9,700 | |||||
Tax Payable Refer To Distributed Dividends | 1,500 | |||||
Effective Income Tax Rate Reconciliation, Amount [Abstract] | ||||||
Income before income taxes | $ 2,352 | $ 3,638 | $ 1,250 | |||
Statutory tax rate in Israel | 26.50% | 26.50% | 25.00% | |||
Theoretical provision for income taxes | $ 623 | $ 964 | $ 313 | |||
Increase (decrease) in effective tax rate due to: | ||||||
IncomeTaxReconciliationChangeInEnactedTaxRate | (337) | (524) | (535) | |||
IncomeTaxReconciliationOtherAdjustments | 0 | 0 | 248 | |||
IncomeTaxReconciliationForeignIncomeTaxRateDifferential | 447 | 88 | (275) | |||
IncomeTaxReconciliationTaxContingencies | (99) | 63 | 206 | |||
Income taxes | $ 634 | $ 591 | (43) | |||
Year 2007 [Member] | ||||||
Future Federal Statutory Tax Rate | ||||||
Unrecognized Tax Benefits Income Tax Penalties And Interest Expense | 213 | |||||
Income Tax Contingency [Line Items] | ||||||
Unrecognized Tax Benefits Income Tax Penalties And Interest Expense | $ 213 |
INCOME TAXESs (Details 1)
INCOME TAXESs (Details 1) $ in Millions | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Tax Carryforwards And Deductions Expiration Period One [Member] | |
Other Tax Carryforward [Line Items] | |
First year in period | Jan. 1, 2017 |
Last year in period | Dec. 31, 2018 |
Tax effect of unspecified carryforward losses and deductions | $ 47 |
Tax Carryforwards And Deductions Expiration Period Two [Member] | |
Other Tax Carryforward [Line Items] | |
First year in period | Jan. 1, 2019 |
Last year in period | Dec. 31, 2025 |
Tax effect of unspecified carryforward losses and deductions | $ 334 |
Tax Carryforwards And Deductions No Expiration [Member] | |
Other Tax Carryforward [Line Items] | |
Tax effect of unspecified carryforward losses and deductions | 205 |
Tax Carryforwards And Deductions Indefinite [Member] | |
Other Tax Carryforward [Line Items] | |
Tax effect of unspecified carryforward losses and deductions | $ 473 |
INCOME TAXES (Details 2)
INCOME TAXES (Details 2) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Deferred Taxes By Report [Line Items] | ||
Deferred tax assets (liabilities) - net | $ 794 | $ 246 |
Prepaid Expenses And Other Current Assets [Member] | ||
Deferred Taxes By Report [Line Items] | ||
Deferred tax assets (liabilities) - net | 735 | 993 |
Other Current Liabilities [Member] | ||
Deferred Taxes By Report [Line Items] | ||
Deferred tax assets (liabilities) - net | 31 | 34 |
Other Assets Deferred Taxes And Deferred Charges [Member] | ||
Deferred Taxes By Report [Line Items] | ||
Deferred tax assets (liabilities) - net | 250 | 388 |
Deferred income taxes [Member] | ||
Deferred Taxes By Report [Line Items] | ||
Deferred tax assets (liabilities) - net | $ 1,748 | $ 1,101 |
DERIVATIVE INSTRUMENTS AND HE79
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2015VEF | |
Derivative [Line Items] | |||
Potential Devaluation Loss Of Monetary Balances | $ 487 | ||
Venezuelans USD Currency Translation | VEF | VEF 6.3 | ||
Proceeds from Accounts Receivable Securitization | 3,447 | $ 4,287 | |
Tender Offer [Member] | |||
Derivative [Line Items] | |||
Unrealized Gain Loss On Derivatives Recognized loss | $ 36 |
DERIVATIVE INSTRUMENTS AND HE80
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details 1) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Swap [Member] | Long Term Investments And Receivables [Member] | Designated As Hedging Instrument [Member] | Cash Flow Hedging [Member] | ||
Derivative Asset, Fair Value, Net [Abstract] | ||
Derivative Fair Value Of Derivative Asset | $ 0 | $ 14 |
Swap [Member] | Other Current Liabilities [Member] | Designated As Hedging Instrument [Member] | Fair Value Hedging [Member] | ||
Derivative Liability, Fair Value, Net [Abstract] | ||
Derivative Fair Value Of Derivative Liability | (11) | (43) |
Swap [Member] | Other Current Liabilities [Member] | Designated As Hedging Instrument [Member] | Cash Flow Hedging [Member] | ||
Derivative Liability, Fair Value, Net [Abstract] | ||
Derivative Fair Value Of Derivative Liability | 0 | 0 |
Swap [Member] | Accounts Payable [Member] | Designated As Hedging Instrument [Member] | Cash Flow Hedging [Member] | ||
Derivative Asset, Fair Value, Net [Abstract] | ||
Derivative Fair Value Of Derivative Asset | 78 | 6 |
Foreign Exchange Contract [Member] | Deferred Taxes And Other Current Assets [Member] | Designated As Hedging Instrument [Member] | Cash Flow Hedging [Member] | ||
Derivative Asset, Fair Value, Net [Abstract] | ||
Derivative Fair Value Of Derivative Asset | 0 | 14 |
Foreign Exchange Contract [Member] | Deferred Taxes And Other Current Assets [Member] | Nondesignated [Member] | ||
Derivative Asset, Fair Value, Net [Abstract] | ||
Derivative Fair Value Of Derivative Asset | 25 | 68 |
Foreign Exchange Contract [Member] | Accounts Payable [Member] | Designated As Hedging Instrument [Member] | Cash Flow Hedging [Member] | ||
Derivative Liability, Fair Value, Net [Abstract] | ||
Derivative Fair Value Of Derivative Liability | 0 | (1) |
Foreign Exchange Contract [Member] | Accounts Payable [Member] | Nondesignated [Member] | ||
Derivative Liability, Fair Value, Net [Abstract] | ||
Derivative Fair Value Of Derivative Liability | (11) | (53) |
Interest Rate Swap [Member] | Long Term Investments And Receivables [Member] | Designated As Hedging Instrument [Member] | Cash Flow Hedging [Member] | ||
Derivative Asset, Fair Value, Net [Abstract] | ||
Derivative Fair Value Of Derivative Asset | 26 | 0 |
Interest Rate Swap [Member] | Accounts Payable [Member] | Designated As Hedging Instrument [Member] | Fair Value Hedging [Member] | ||
Derivative Asset, Fair Value, Net [Abstract] | ||
Derivative Fair Value Of Derivative Asset | 1 | 0 |
Interest Rate Swap [Member] | Accounts Payable [Member] | Designated As Hedging Instrument [Member] | Cash Flow Hedging [Member] | ||
Derivative Liability, Fair Value, Net [Abstract] | ||
Derivative Fair Value Of Derivative Liability | (10) | 0 |
Cross Currency Interest Rate Contract [Member] | Accounts Payable [Member] | Designated As Hedging Instrument [Member] | Cash Flow Hedging [Member] | ||
Derivative Liability, Fair Value, Net [Abstract] | ||
Derivative Fair Value Of Derivative Liability | $ (5) | $ 0 |
DERIVATIVE INSTRUMENTS AND HE81
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details 2) - Financial Expenses Net [Member] - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Foreign Exchange Contract [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Gain (loss) recognized in earnings for the period on derivative contracts | $ (26) | $ (85) | $ 76 |
Interst Rate And Cross Currency Swap [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Gain (loss) recognized in earnings for the period on derivative contracts | $ 27 | $ 41 | $ 35 |
DERIVATIVE INSTRUMENTS AND HE82
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details 3) - Designated As Hedging Instrument [Member] - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Interest Rate Swap [Member] | Fair Value Hedging [Member] | ||
Derivative [Line Items] | ||
Derivative Notional Amount | $ 1,294 | $ 1,750 |
Interest Rate Swap [Member] | Cash Flow Hedging [Member] | ||
Derivative [Line Items] | ||
Derivative Notional Amount | 3,500 | 0 |
Cross Currency Interest Rate Contract [Member] | Cash Flow Hedging [Member] | ||
Derivative [Line Items] | ||
Derivative Notional Amount | 588 | 1,875 |
Cross Currency Interest Rate Contract Forecasted Work Plan Exposure [Member] | Cash Flow Hedging [Member] | ||
Derivative [Line Items] | ||
Derivative Notional Amount | 0 | 280 |
Treasury Lock [Member] | Cash Flow Hedging [Member] | ||
Derivative [Line Items] | ||
Derivative Notional Amount | $ 500 | $ 0 |
DERIVATIVE INSTRUMENTS AND HE83
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details 4) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Derivative Instruments and Hedging Activities [Absract] | ||
Sold receivables at the beginning of the year | $ 585 | $ 590 |
Proceeds from sale of receivables | 3,447 | 4,287 |
Cash collections (remitted to the owner of the receivables) | (3,532) | (4,202) |
Effect of currency exchange rate changes | (55) | (90) |
Sold receivables at the end of the year | $ 445 | $ 585 |
FINANCIAL EXPENSES NET (Details
FINANCIAL EXPENSES NET (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Financial Expenses Net [Abstract] | |||
Income from investments | $ 34 | $ 24 | $ 32 |
Interest expense and other bank charges | (270) | (300) | (314) |
Losses from hedging transactions in connection with the ratiopharm acquisition | 0 | 0 | 0 |
Foreign exchange (gains) losses - net | 9 | (30) | (8) |
Other Than Temporary Impairment of Securities | (631) | $ (6) | 0 |
Gain From Interest Rate Swap Transaction | 0 | 0 | |
Other- mainly debt tender offer and termination of related swap agreements | (142) | $ (1) | (109) |
Financial expenses-net | $ (1,000) | $ (313) | $ (399) |
OTHER EXPENSES (Details)
OTHER EXPENSES (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Impairment Restructuring And Others [Abstract] | ||||
Impairment of long-lived assets | $ 361 | $ 387 | $ 524 | |
Contingent Consideration | (399) | 20 | (36) | |
Acquisition costs | 211 | 13 | 27 | |
Restructuring | 183 | 246 | 201 | |
Other expenses | (23) | 24 | 0 | |
Total | 1,131 | 650 | 788 | |
Impairment [Line Items] | ||||
Impairment of intangible assets | 265 | 224 | 393 | |
Impairment of Intangible Assets, Finite-lived | 361 | 227 | 233 | |
ImpairmentOfIntangibleAssetsIndefinitelivedExcludingGoodwill | 108 | 166 | 625 | |
Impairment charge during the year on property, plant and equipment | 96 | 163 | 61 | |
Business Combination Contingent Consideration Arrangements Change In Amount O fContingent Consideration Liability1 | 399 | $ (20) | $ 36 | |
Pro-Rata Currency Translation Adjustments | 24 | |||
Mylan [Member] | ||||
Impairment Restructuring And Others [Abstract] | ||||
Contingent Consideration | $ (105) | |||
Impairment [Line Items] | ||||
Business Combination Contingent Consideration Arrangements Change In Amount O fContingent Consideration Liability1 | $ 105 | |||
currentMarketAndSupplyChainConditions [Member] | ||||
Impairment [Line Items] | ||||
Impairment of Intangible Assets, Finite-lived | 132 | |||
MDT-637 [Member] | ||||
Impairment [Line Items] | ||||
ImpairmentOfIntangibleAssetsIndefinitelivedExcludingGoodwill | 102 | |||
FDA Approval Of Bendata [Member] | ||||
Impairment Restructuring And Others [Abstract] | ||||
Contingent Consideration | (63) | |||
Impairment [Line Items] | ||||
Business Combination Contingent Consideration Arrangements Change In Amount O fContingent Consideration Liability1 | 63 | |||
TEV 48125 [Member] | ||||
Impairment Restructuring And Others [Abstract] | ||||
Contingent Consideration | (311) | |||
Impairment [Line Items] | ||||
Business Combination Contingent Consideration Arrangements Change In Amount O fContingent Consideration Liability1 | 311 | |||
Synribo [Member] | ||||
Impairment [Line Items] | ||||
Impairment of Intangible Assets, Finite-lived | 133 | |||
Mesoblast [Member] | ||||
Impairment [Line Items] | ||||
OtherAssetImpairmentCharges | $ 171 |
LEGAL SETTLEMENTS (Details)
LEGAL SETTLEMENTS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Impairment Of Long Lived Assets And Contingent Consideration [Abstract] | |||
Legal Settlements Acquisition And Restructuring And Impairment | $ 631 | $ 111 | $ 1,500 |
SEGMENTS (Details)
SEGMENTS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Segment Reporting Information [Line Items] | |||
Revenues | $ 19,652 | $ 20,272 | $ 20,314 |
Gross profit | 11,356 | 11,056 | 10,707 |
Research and development expenses | 1,525 | 1,488 | 1,427 |
Selling and marketing expenses | 3,478 | 3,861 | 4,080 |
Segments Profitability | 3,352 | 3,951 | 1,649 |
Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Segments Profitability | 7,043 | 6,761 | 6,221 |
Generics [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | 9,546 | 9,814 | 9,902 |
Gross profit | 4,499 | 4,253 | 4,083 |
Research and development expenses | 513 | 512 | 488 |
Selling and marketing expenses | 1,304 | 1,575 | 1,915 |
Segments Profitability | 2,682 | 2,166 | 1,680 |
Specialty [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | 8,338 | 8,560 | 8,388 |
Gross profit | 7,200 | 7,457 | 7,274 |
Research and development expenses | 918 | 872 | 877 |
Selling and marketing expenses | 1,921 | 1,990 | 1,856 |
Segments Profitability | $ 4,361 | $ 4,595 | $ 4,541 |
SEGMENTS (Details 1)
SEGMENTS (Details 1) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Segments Profitability | $ 3,352 | $ 3,951 | $ 1,649 |
Amounts not allocated to segments [Abstract] | |||
Depreciation and amortization | 1,308 | 1,508 | 1,642 |
General and administrative expenses | 1,239 | 1,217 | 1,239 |
Legal Settlements And Loss Contingencies | 631 | (111) | 1,524 |
Impairments Restructuring And Others | 1,131 | 650 | 788 |
Financial expenses - net | (1,000) | (313) | (399) |
Income before income taxes | 2,352 | 3,638 | 1,250 |
Segments and Other activities [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Segments Profitability | 7,361 | 6,987 | 6,464 |
Segments [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Segments Profitability | 7,043 | 6,761 | 6,221 |
Generics [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Segments Profitability | 2,682 | 2,166 | 1,680 |
Specialty [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Segments Profitability | 4,361 | 4,595 | 4,541 |
All Other Segments [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Segments Profitability | 318 | 226 | 243 |
Segment Reconciling Items [Member] | |||
Amounts not allocated to segments [Abstract] | |||
Depreciation and amortization | 838 | 1,036 | 1,180 |
General and administrative expenses | 1,239 | 1,217 | 1,239 |
Legal Settlements And Loss Contingencies | 631 | (111) | 1,524 |
Impairments Restructuring And Others | 1,131 | 650 | 788 |
Otehr Unallocated Amounts | $ 170 | $ 244 | $ 84 |
SEGMENTS (Details 2)
SEGMENTS (Details 2) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Net sales by geographic area | $ 19,652 | $ 20,272 | $ 20,314 |
Information About Major Customers And Products [Abstract] | |||
The net sales to the Companys largest customer as a percentage of total net sales | 20.00% | 18.00% | 17.00% |
Percentage Of Total Receivables For Largest Customer | 30.00% | 31.00% | |
Percentage of Total Revenue for Another Customer | 20.00% | 17.00% | 13.00% |
Generics [Member] | |||
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Net sales by geographic area | $ 9,546 | $ 9,814 | $ 9,902 |
Branded [Member] | |||
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Net sales by geographic area | 8,338 | 8,560 | 8,388 |
Other Products [Member] | |||
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Net sales by geographic area | 1,768 | 1,898 | 2,024 |
Us Group One [Member] | Generics [Member] | |||
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Net sales by geographic area | 4,793 | 4,418 | 4,172 |
Us Group One [Member] | Branded [Member] | |||
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Net sales by geographic area | 6,442 | 6,110 | 6,025 |
Us Group One [Member] | Other Products [Member] | |||
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Net sales by geographic area | 14 | 106 | 264 |
Europe Group Two [Member] | Generics [Member] | |||
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Net sales by geographic area | 2,706 | 3,148 | 3,362 |
Europe Group Two [Member] | Branded [Member] | |||
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Net sales by geographic area | 1,518 | 1,898 | 1,854 |
Europe Group Two [Member] | Other Products [Member] | |||
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Net sales by geographic area | 666 | 777 | 772 |
Rest Of The World [Member] | Generics [Member] | |||
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Net sales by geographic area | 2,047 | 2,248 | 2,368 |
Rest Of The World [Member] | Branded [Member] | |||
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Net sales by geographic area | 378 | 552 | 509 |
Rest Of The World [Member] | Other Products [Member] | |||
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Net sales by geographic area | $ 1,088 | $ 1,015 | $ 988 |
SEGMENTS (Details 3)
SEGMENTS (Details 3) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Product Information [Line Items] | |||
Net revenues | $ 19,652 | $ 20,272 | $ 20,314 |
Branded CNS [Member] | |||
Product Information [Line Items] | |||
Net revenues | 5,213 | 5,575 | 5,545 |
Branded Respiratory Products [Member] | |||
Product Information [Line Items] | |||
Net revenues | 1,129 | 957 | 964 |
Branded Womens Health Products [Member] | |||
Product Information [Line Items] | |||
Net revenues | 461 | 504 | 510 |
Branded Oncology Products [Member] | |||
Product Information [Line Items] | |||
Net revenues | 1,201 | 1,180 | 1,005 |
Other Branded Products [Member] | |||
Product Information [Line Items] | |||
Net revenues | 334 | 344 | 364 |
Branded C N S Copaxone [Member] | |||
Product Information [Line Items] | |||
Net revenues | 4,023 | 4,237 | 4,328 |
Branded C N S Azilect [Member] | |||
Product Information [Line Items] | |||
Net revenues | 384 | 428 | 371 |
Branded C N S Nuvigil [Member] | |||
Product Information [Line Items] | |||
Net revenues | 373 | 388 | 320 |
Branded Respiratory Proair [Member] | |||
Product Information [Line Items] | |||
Net revenues | 549 | 478 | 429 |
Branded Respiratory Qvar [Member] | |||
Product Information [Line Items] | |||
Net revenues | 392 | 286 | 328 |
Branded Oncology Treanda [Member] | |||
Product Information [Line Items] | |||
Net revenues | 741 | 767 | 709 |
Branded [Member] | |||
Product Information [Line Items] | |||
Net revenues | $ 8,338 | $ 8,560 | $ 8,388 |
SEGMENTS (Details 4)
SEGMENTS (Details 4) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Property, plant and equipment, net | $ 6,544 | $ 6,535 |
Israel [Member] | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Property, plant and equipment, net | 2,159 | 1,949 |
United States [Member] | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Property, plant and equipment, net | 629 | 691 |
Croatia [Member] | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Property, plant and equipment, net | 539 | 515 |
Hungary [Member] | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Property, plant and equipment, net | 506 | 520 |
Germany [Member] | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Property, plant and equipment, net | 332 | 367 |
Japan [Member] | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Property, plant and equipment, net | 415 | 446 |
Other Countries [Member] | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Property, plant and equipment, net | $ 1,964 | $ 2,047 |
SEGMENTS (Details 5)
SEGMENTS (Details 5) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Segment Reporting [Abstract] | |||
CopaxoneUS revenues | $ 3,200 | ||
Percentage Of CopaxoneRevenues Of Total US | 29.00% | ||
Copaxone Outside US Revenues | $ 783 | ||
Percentage Of Copaxone Revenues Of Total Non US | 9.00% | ||
Profitability Of MS As A Percentage Of Copaxone Revenues | 77.00% | 75.00% | 76.00% |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Net Income And Weighted Average Number Of Shares Used In Computation Of Basic And Diluted Earnings Per Share [Abstract] | |||
Interest expense on convertible senior debentures, and issuance costs, net of tax benefits | $ 0 | $ 0 | $ 0 |
Net income used for the computation of diluted earnings per share | $ 1,573 | $ 3,055 | $ 1,269 |
Weighted average number of shares used in the computation of basic earnings per share | 855 | 853 | 849 |
Additional shares from the assumed exercise of employee stock options and unvested RSU's | 5 | 3 | 1 |
Weighted average number of additional shares issued upon the assumed conversion of convertible senior debentures | 4 | 2 | 0 |
Weighted average number of shares used in the computation of diluted earnings per share | 864 | 858 | 850 |
Net income attributable to ordinary shareholders | $ 1,573 | $ 3,055 | $ 1,269 |
Ordinary And Special Shares Outstanding [Abstract] | |||
Ordinary shares - issued | 1,016 | 957 | |
Treasury, shares | 108 | 105 |
SCHEDULE II VALUATION AND QUA94
SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Allowance For Doubtful Accounts Current Member | ||||
Valuation And Qualifying Accounts Disclosure [Line Items] | ||||
Charged to costs and expenses | $ 18 | $ 22 | $ 44 | |
Charged to other accounts | (6) | (18) | 3 | |
Deductions | (15) | (42) | (5) | |
Valuation Allowances And Reserves Balance | 146 | 149 | 187 | $ 145 |
Valuation Allowance Tax Carryforward Losses And Deductions [Member] | ||||
Valuation And Qualifying Accounts Disclosure [Line Items] | ||||
Charged to costs and expenses | 249 | 128 | 182 | |
Charged to other accounts | 1 | 0 | 0 | |
Deductions | (161) | (248) | (117) | |
Valuation Allowances And Reserves Balance | $ 760 | $ 671 | $ 791 | $ 726 |
Uncategorized Items - teva-2015
Label | Element | Value |
Pantoprazole Settlement Agreement Amount | teva_PantoprazoleSettlementAgreementAmount | $ 1,600,000,000 |
Operating Leases Future Minimum Payments Due Current | us-gaap_OperatingLeasesFutureMinimumPaymentsDueCurrent | 141,000,000 |
Royalty Expense | us-gaap_RoyaltyExpense | 911,000,000 |
Royalty Expense | us-gaap_RoyaltyExpense | 987,000,000 |
Royalty Expense | us-gaap_RoyaltyExpense | 1,100,000,000 |
Annual Sales Of Actoplus | teva_AnnualSalesOfActoplus | 500,000,000 |
Annual Sales Of Actoplus | teva_AnnualSalesOfActoplus | 430,000,000 |
Annual Sales Of Wellbutrin | teva_AnnualSalesOfWellbutrin | $ 1,000,000,000 |
CivilPenaltyForEachAllegedlyFalseClaimSubmittedRange | teva_Civilpenaltyforeachallegedlyfalseclaimsubmittedrange | Under the federal False Claims Act, the government (or relators who pursue the claims without the participation of the government in the case) may seek to recover up to three times the amount of damages in addition to a civil penalty of $5,500 to $11,000 for each allegedly false claim submitted to the government for payment. |
Annual sales of Provigil | teva_AnnualSalesOfProvigil | $ 500,000,000 |
Annual sales of Provigil | teva_AnnualSalesOfProvigil | 1,000,000,000 |
Ciprofloxacin Plaintiffs Proposed Settlement With Bayer | teva_CiprofloxacinPlaintiffsProposedSettlementWithBayer | 500,000,000 |
Ciprofloxacin Plaintiffs Proposed Settlement With Bayer | teva_CiprofloxacinPlaintiffsProposedSettlementWithBayer | 74,000,000 |
Operating Leases Future Minimum Payments Due In Two Years | us-gaap_OperatingLeasesFutureMinimumPaymentsDueInTwoYears | 115,000,000 |
Annual Sales Of Abilify | teva_AnnualSalesOfAbilify | 7,800,000,000 |
Business Acquisition, Contingent Consideration, Potential Cash Payment | us-gaap_BusinessCombinationContingentConsiderationArrangementsRangeOfOutcomesValueHigh | 2,300,000,000 |
Annual Sales Of Aggrenox | teva_AnnualSalesOfAggrenox | 340,000,000 |
Annual Sales Of Aggrenox | teva_AnnualSalesOfAggrenox | 455,000,000 |
FTC Settelement Charge | teva_FTCSettelementCharge | 398,000,000 |
Annual Sales of Effexor | teva_AnnualSalesOfEffexor | 2,600,000,000 |
Annual Sales Of Namebda | teva_AnnualSalesOfNamebda | 1,100,000,000 |
Annual Sales Of Namebda | teva_AnnualSalesOfNamebda | 1,400,000,000 |
Cephalon Losses Resulting From The Promotion and Prescription of Actiq | teva_CephalonLossesResultingFromPromotionAndPrescriptionOfActiq | 700,000,000 |
Annual Sales of Niaspan | teva_AnnualSalesOfNiaspan | 1,100,000,000 |
Annual Sales of Niaspan | teva_AnnualSalesOfNiaspan | 416,000,000 |
Annual Sales of Solodyn | teva_AnnualSalesOfSolodyn | 380,000,000 |
Annual Sales of Solodyn | teva_AnnualSalesOfSolodyn | 765,000,000 |
Pantoprazole Insurance Recovery | teva_PantoprazoleInsuranceRecovery | 339,000,000 |
Annual Sales Of Actos | teva_AnnualSalesOfActos | 2,800,000,000 |
Annual Sales Of Actos | teva_AnnualSalesOfActos | 3,700,000,000 |
Lease And Rental Expense | us-gaap_LeaseAndRentalExpense | 122,000,000 |
Lease And Rental Expense | us-gaap_LeaseAndRentalExpense | 153,000,000 |
Lease And Rental Expense | us-gaap_LeaseAndRentalExpense | 117,000,000 |
Annual Sales of Lamictal | teva_AnnualSalesOfLamictal | 950,000,000 |
Annual Sales of Lamictal | teva_AnnualSalesOfLamictal | 2,300,000,000 |
Operating Leases Future Minimum Payments Due In Three Years | us-gaap_OperatingLeasesFutureMinimumPaymentsDueInThreeYears | 92,000,000 |
Operating Leases Future Minimum Payments Due In Five Years | us-gaap_OperatingLeasesFutureMinimumPaymentsDueInFiveYears | 39,000,000 |
Monetary Relief Payment Settelement Fund | teva_MonetaryReliefPaymentSettelementFund | 1,200,000,000 |
Nexium Settlement Payment | teva_NexiumSettlementPayment | 24,000,000 |
Compensatory Damages For The State of Illonois | teva_CompensatoryDamagesForStateOfIllonois | 100,000,000 |
Operating Leases Future Minimum Payments Due In Four Years | us-gaap_OperatingLeasesFutureMinimumPaymentsDueInFourYears | 59,000,000 |
Operating Leases Future Minimum Payments Due Thereafter | us-gaap_OperatingLeasesFutureMinimumPaymentsDueThereafter | $ 111,000,000 |
Long Term Equity Based Incentive Plan [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award Award Expiration Period | teva_ShareBasedCompensationArrangementByShareBasedPaymentAwardAwardExpirationPeriod | ten |
Past Employee Stock And Incentived Plans [Member] | ||
Number of equivalent stock units approved for grants under the plan | us-gaap_ShareBasedCompensationArrangementByShareBasedPaymentAwardNumberOfSharesAuthorized | 70,000,000 |
Number of equivalent stock units approved for grants under the plan | us-gaap_ShareBasedCompensationArrangementByShareBasedPaymentAwardNumberOfSharesAuthorized | 43,700,000 |
Number of equivalent stock units approved for grants under the plan | us-gaap_ShareBasedCompensationArrangementByShareBasedPaymentAwardNumberOfSharesAuthorized | 43,400,000 |
Share Based Compensation Arrangement By Share Based Payment Award Award Expiration Period | teva_ShareBasedCompensationArrangementByShareBasedPaymentAwardAwardExpirationPeriod | seven |
Nu Pathe [Member] | ||
Business Acquisition, Contingent Consideration, Potential Cash Payment | us-gaap_BusinessCombinationContingentConsiderationArrangementsRangeOfOutcomesValueHigh | $ 130,000,000 |