Teva Pharmaceutical Industries Ltd. (NYSE and TASE: TEVA) has received significant positive rating actions from major credit agencies, signaling a strong turnaround and progress in its strategic initiatives. S&P Global Ratings upgraded Teva’s long-term issuer credit rating to ‘BB+’ from ‘BB’ with a stable outlook, while Moody’s affirmed Teva’s B1a rating and revised its outlook to positive from stable. These developments underscore Teva’s successful execution of its “Pivot to Growth” strategy and its commitment to financial discipline.
The upgrades are largely driven by Teva’s consistent deleveraging trajectory. S&P noted that adjusted leverage declined to 4.4x as of September 30, 2025, and is expected to fall below 4.25x in the coming quarters. This trend meets the threshold for the higher rating. Moody’s, meanwhile, anticipates leverage to approach 3.5x within the next 12 to 18 months, a key factor in their positive outlook revision.
Both agencies recognized Teva’s return to revenue growth after a five-year period of decline. This resurgence is attributed to robust performance in its branded medicines segment and a stabilization in its generics business. The momentum in Teva’s branded franchises, coupled with upcoming product launches in both branded and biosimilar portfolios, is projected to effectively offset ongoing headwinds in the generics sector.
Teva’s Chief Financial Officer, Eli Kalif, expressed confidence in the company’s strategic direction. “This upgrade is a powerful testament to our strategic vision and disciplined execution,” Kalif stated. “By driving our Pivot to Growth strategy, prioritizing robust cash flow management, and rigorously allocating capital, we have demonstrated unwavering commitment to deleveraging and sustainable business growth.”
**Key Factors Supporting Rating Actions:**
* **Deleveraging:** Consistent reduction in debt levels is a primary driver for the upgraded ratings and positive outlook.
* **Revenue Growth:** A return to top-line growth signals a healthier business model after a prolonged period of decline.
* **Branded Medicine Momentum:** Strong performance and pipeline development in innovative therapies are crucial for future profitability.
* **Biosimilar Launches:** Strategic introduction of biosimilar products is expected to contribute significantly to revenue diversification and market presence.
* **Liquidity Profile:** A solid liquidity position provides financial flexibility and confidence in Teva’s ability to manage its obligations.
While the outlook is decidedly positive, challenges remain. The generics segment continues to face persistent headwinds, and overall leverage, though improving, is still at a level that warrants ongoing monitoring by the credit agencies. However, the agency actions suggest that the market is recognizing Teva’s successful transition and its trajectory towards achieving investment-grade status, a significant milestone for the pharmaceutical giant.
Teva Pharmaceutical Industries Ltd. is actively transforming into a leading innovative biopharmaceutical company, leveraging its established generics business. With over 120 years of history, Teva remains dedicated to improving global health through innovation in areas such as neuroscience and immunology, alongside providing essential generic medicines, biosimilars, and pharmacy brands.
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