August 6, 2015
By Mark Terry, BioSpace.com Breaking News Staff
Israel-based Teva Pharmaceutical Industries Ltd. announced yesterday that it will be cutting 33 jobs at its Forest, Va. Location. That accounts for about eight percent of the company’s workforce at that site.
On July 27, Teva acquired Allergan Plc ’s generic drug business for $40.5 billion. Under that deal, Allergan received $33.7 billion in cash and $6.75 billion in Teva stock. That deal is expected to be completed in the first quarter of 2016.
That deal is the cornerstone and hallmark of what’s going on in the generic market lately. In the U.S. there are four major distributors of generic drugs, McKesson Corporation (MCK), CVS Health Corp. via a partnership with Cardinal Health , Walgreens Boots Alliance Inc., through a deal with AmerisourceBergen Corporation and Wal-Mart Stores Inc.
Companies that focus on generic drugs, such as Teva, are merging partly in order to have leverage to negotiate lower prices with distributors.
In March 2015, Teva announced it had signed a contract with the U.S. military worth $170 million to manufacture a vaccine for adenovirus at the Forest, Va. Facility. The contract was to last five years. The vaccine is given to military personnel to prevent the spread of the infectious respiratory disease in basic training camps.
At that time, the facility employed about 435 people, 30 of whom were involved in the vaccine production. The vaccine was formerly manufactured by Wyeth , but was being phased out after the Department of Defense (DoD) turned down financial aid requests from Wyeth. Production halted in 1996 and inventory ran out in 1999. Adenovirus-related diseases increased dramatically and were tied to several deaths.
In 2001 the DoD went in search of another company willing to manufacture the vaccine, which by then required additional rounds of development, clinical trials and regulatory review. Teva won the contract. In the contract, Teva indicated it was to supply 250,000 vaccine doses annually to be used at nine basic training camps.
Earlier this week Teva announced it was purchasing a 51 percent equity share of genomic-analysis company Immuneering Corporation, headquartered in Cambridge, Mass. Immuneering is a privately held company that provides advanced data analysis services using proprietary algorithms for biopharma companies. The deal also gives Teva right of first refusal in projects related to treatment of disorders of the central nervous system (CNS).
“Patients who suffer from CNS diseases urgently need better medicines,” said Ben Zeskind, chief executive and co-founder of Immuneering in a statement. “Immuneering is pioneering new ways to use gene expression and genomic data to elucidate the biological mechanisms underlying both the development of disease, and the effectiveness of medicines. Combining Immuneering’s technology platform and expertise with Teva’s world-class scientific knowledge, intensity and devotion to patient benefit is a logical next step to build on the success of the Teva/Immuneering collaborations to date. This partnership represents an unprecedented and exciting new approach to improving the lives of patients with CNS diseases.”
Teva employs about 43,000 people worldwide. The only reason cited for the Forest, Va. layoffs was a drop in product demand.
