Benny Landa, one of Israel's most experienced and successful technology entrepreneurs, is also one of the largest individual shareholders in Teva Pharmaceutical Industries Ltd. (NYSE: TEVA; TASE: TEVA). Landa, who has been highly critical of Teva's board of directors in the past, now seems pessimistic about the company's future.
Asked whether Teva is at risk of being taken over by a foreign company and losing its independence, Landa says, "What does it matter now who Teva's owners are? In any case the company is held by non-Israelis. There's only one thing that matters, and that is the extent of employment in Israel."
It looks as though the fact that Teva is an Israeli company led it to keep plants going here that were not competitive
"That can't last. If a generics facility is not competitive, then in the end it will be closed. That's why I always said that being based on generics was not the right way forward for Teva, and that it should strengthen its innovative arm. Unfortunately, that proved correct."
If so, it's the end of the story. Teva broke up its innovative division.
"Yes. It's all over, there's nothing left. Or to be more exact, there are remnants left, but like the majority of the investors, the management is also overseas. Only public relations and human resources are left at the head office in Israel. Under Schultz's organizational structure, research and development will be transferred to an administration that came from Actavis and is based in the US, marketing is in the US, logistics are in the US. The innovative R&D that was managed by Michael Hayden from Israel has basically been terminated."
In the past you supported spinning off the innovative division into a separate company. Schultz chose not to do that.
"On the face of it, it would seem that it would have been possible to sell the innovative division for a higher sum as a going concern, as a functioning division, and to let it remain in Israel. That's what I would have done in Schultz's place, but my motives are different from his, because I'm a Zionist. He came only to raise the share price, and he doesn't have time for long-term investment. On the other hand, you can't blame him. He didn't create this situation, he's only dealing with it. They presented him with a company on the verge of insolvency."
Throughout our conversation, Landa did not cease to express deep sorrow at the what had happened, and he concluded by saying, "If it had happened because of a terrible earthquake, then it would have been a natural disaster, but no, people did this."
Published by Globes [online], Israel business news - www.globes-online.com - on December 20, 2017
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