TEVA PHARMACEUTICAL INDUSTRIES LTD
For the period ended May 28, 2026. Filed Mar 31, 2026.
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May 28, 2026 · Filed Mar 31, 2026
Contents
Appendix A
Reconciliations of GAAP Reported to Non-GAAP Financial Information
This Proxy Statement contains certain financial information that differs from what is reported under accounting principles generally accepted in the United States (“GAAP”). Thesenon-GAAP financial measures includenon-GAAP net income, non-GAAP earnings per share (“EPS”), non-GAAP operating income, non-GAAP operating margin, free cash flow and net debt. We present thesenon-GAAP financial measures as management believes that such data provide useful information to investors. The following are examples of how we utilizenon-GAAP measures:
| • | our executive officers and Board use non-GAAP measures to evaluate our operational performance, to prepare and evaluate our work plans and annual budgets, and ultimately to evaluate the performance of our executive officers; |
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| • | our annual budgets are prepared on a non-GAAP basis; and |
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| • | senior executive officers’ annual compensation is derived, in part, using these non-GAAP measures. While qualitative factors and judgment also affect annual compensation, the principal quantitative elements in the determination of such compensation are the various performance targets tied to the work plan, which are based on these non-GAAP measures . |
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Non-GAAP financial measures have no standardized meaning and accordingly have limitations in their usefulness to investors. Investors are cautioned that, unlike financial measures prepared in accordance with U.S. GAAP, non-GAAP measures may not be comparable with the calculation of similar measures for other companies. Thesenon-GAAP financial measures are presented solely to permit investors to more fully understand how management assesses our performance. The limitations of usingnon-GAAP financial measures as performance measures are that they provide a view of our results of operations without including all events during a period and may not provide a comparable view of our performance to other companies in the pharmaceutical industry. Investors should consider ournon-GAAP financial measures in addition to, and not as replacements for, or superior to, measures of financial performance prepared in accordance with GAAP.
104 |Teva Pharmaceutical Industries Ltd. 2026 Proxy Statement
Non-GAAP Net Income and Non-GAAP EPS
The following table presents ournon-GAAP net income andnon-GAAP EPS for the years ended December 31, 2025 and 2024, as well as reconciliations of each measure to their nearest GAAP equivalents:
| Year ended December 31, | |||
|---|---|---|---|
| ($ in millions except per share amounts) · 2025 · 2024 | |||
| Net income (Loss) attributable to Teva | ($) | 1,410 | (1,639) |
| Increase (decrease) for excluded items: | |||
| Amortization of purchased intangible assets | 581 | 588 | |
| Legal settlements and loss contingencies(1) | 473 | 761 | |
| Goodwill impairment(2) | — | 1,280 | |
| Impairment of long-lived assets(3) | 1,029 | 1,275 | |
| Restructuring costs(4) | 225 | 74 | |
| Equity compensation | 157 | 123 | |
| Contingent consideration(5) | 54 | 303 | |
| Loss (Gain) on sale of business | 22 | (15) | |
| Accelerated depreciation | 21 | 13 | |
| Financial expenses | 69 | 49 | |
| Items attributable to non-controlling interests(3) | 2 | (339) | |
| Other non-GAAP items(6) | 186 | 229 | |
| Corresponding tax effects and unusual tax items(7) | (819) | 157 | |
| Non-GAAP net income attributable to Teva | ($) | 3,411 | 2,860 |
| Non-GAAP tax rate(8) | 15.8% | 15.3% | |
| GAAP diluted earnings (loss) per share attributable to Teva | ($) | 1.21 | (1.45) |
| EPS difference(9) | 1.72 | 3.94 | |
| Non-GAAP diluted EPS attributable to Teva(9) | ($) | 2.93 | 2.49 |
| Non-GAAP average number of shares (in millions)(9) | 1,163 | 1,150 | |
| (1) | Adjustments for legal settlements and loss contingencies in 2025 were mainly related to an update to the estimated settlement provision of $220 million for the opioid cases (mainly the effect of the passage of time on the net present value of the discounted payments), an update of $56 million related to the provision recorded for the carvedilol patent litigation, an update of $55 million related to the estimated provision recorded for the claims brought by attorneys general representing states and territories throughout the United States in the generic drug antitrust litigation, as well as a provision of $35 million recorded for the antitrust litigation related to QVAR. Adjustments for legal settlements and loss contingencies in 2024 were mainly related to legal expenses of $357 million recorded in connection with a decision by the European Commission in its antitrust investigation into COPAXONE, and an update to the estimated settlement provision of $278 million for the opioid cases (mainly the effect of the passage of time on the net present value of the discounted payments and the settlement agreement with the city of Baltimore). |
| (2) | In 2024, goodwill impairment charges of $1,280 million were recorded related to our API reporting unit. |
| (3) | Adjustments for impairment of long-lived assets in 2025 were mainly related to a $726 million impairment charge in connection with a manufacturing facility in Europe. Adjustments for impairment of long-lived assets and items attributable to non-controlling interests in 2024 primarily consisted of $715 million and $342 million, respectively, related to the classification of our business venture in Japan as held for sale. In addition, in 2024 we recognized an impairment of $275 million related to the classification of our API business (including its R&D, manufacturing and commercial activities) as held for sale. |
| (4) | In 2025, Teva recorded $225 million of restructuring expenses primarily related to optimization activities in connection with Teva’s Transformation programs related to Teva’s global organization and operations, mainly through headcount reduction. |
| (5) | Adjustments in 2024 primarily related to a change in the estimated future royalty payments to Allergan in connection with lenalidomide capsules (the generic version of Revlimid®) of $270 million. |
| (6) | Other non-GAAP items include other exceptional items that we believe are sufficiently large that their exclusion is important to facilitate an understanding of trends in our financial results, primarily related to the rationalization of our plants, certain inventory write-offs, material litigation fees and other unusual events. |
| (7) | Adjustments for corresponding tax effects and unusual tax items in 2025 include an income tax item in an amount of $246 million related to a valuation allowance release in the U.S. Adjustments for corresponding tax effects and unusual tax items in 2024 include a tax item in an amount of $495 million related to the settlement agreement with the ITA to settle certain litigation with respect to taxes payable for the Company’s taxable years 2008 through 2020. |
| (8) | Non-GAAP tax rate is tax expenses (benefit) excluding the impact of non-GAAP tax adjustments presented above as a percentage of income (loss) before income taxes excluding the impact of non-GAAP adjustments presented above. |
| (9) | EPS difference and diluted non-GAAP EPS are calculated by dividing our non-GAAP net income attributable to Teva by our non-GAAP diluted weighted average number of shares. |
105 |Teva Pharmaceutical Industries Ltd. 2026 Proxy Statement
Non-GAAP Operating Income (Loss) and Non-GAAP Operating Margin
The following table presents ournon-GAAP operating income (loss) andnon-GAAP operating margin for the years ended December 31, 2025 and 2024, as well as reconciliations of each measure to its nearest GAAP equivalent:
| Year ended December 31, | ||
|---|---|---|
| ($ in millions) | 2025 | 2024 |
| GAAP operating income (loss) | $2,157 | (303) |
| GAAP operating margin | 12.5% | (1.8)% |
| Increase (decrease) for excluded items:(1) | ||
| Amortization of purchased intangible assets | 581 | 588 |
| Legal settlements and loss contingencies | 473 | 761 |
| Goodwill impairment | — | 1,280 |
| Impairment of long-lived assets | 1,029 | 1,275 |
| Restructuring costs | 225 | 74 |
| Equity compensation | 157 | 123 |
| Contingent consideration | 54 | 303 |
| Loss (gain) on sale of business | 22 | (15) |
| Accelerated depreciation | 21 | 13 |
| Other non-GAAP items | 186 | 229 |
| Non-GAAP operating income (loss) | $4,905 | 4,329 |
| Non-GAAP operating margin(2) | 28.4% | 26.2% |
| (1) | For further explanations, refer to the footnotes under the “Reconciliation of net income (loss) attributable to Teva to non-GAAP net income (loss) attributable to Teva” table. |
| (2) | Non-GAAP operating margin is non-GAAP operating income as a percentage of revenues. |
Free Cash Flow
The following table presents our Free Cash Flow for the years ended December 31, 2025 and 2024, as well as reconciliations of Free Cash Flow for such periods to its nearest GAAP equivalent:
| Year ended December 31, | ||
|---|---|---|
| ($ in millions) | 2025 | 2024 |
| Net cash provided by (used in) operating activities | 1,649 | 1,247 |
| Beneficial interest collected in exchange for securitized account receivables | 1,214 | 1,291 |
| Purchases of property, plant and equipment and intangible assets | (501) | (498) |
| Acquisition of business, net of cash acquired | — | (15) |
| Proceeds from divestitures of businesses and other assets | 34 | 43 |
| Free cash flow | $2,396 | $2,068 |
106 |Teva Pharmaceutical Industries Ltd. 2026 Proxy Statement
Net Debt
The following table presents a reconciliation of Teva’s net debt to Teva’s total debt for the years ended December 31, 2025 and 2024:
| Year ended December 31, | ||
|---|---|---|
| ($ in millions) | 2025 | 2024 |
| Short-term debt | 1,820 | 1,781 |
| Senior notes and loans | 14,986 | 16,002 |
| Total debt | 16,807 | 17,783 |
| Net of cash and cash equivalents | 3,556 | 3,300 |
| Net debt | $13,251 | $14,482 |
107 |Teva Pharmaceutical Industries Ltd. 2026 Proxy Statement
TEVA PHARMACEUTICAL INDUSTRIES LIMITED (“TEVA”)
2026 ANNUAL GENERAL MEETING OF SHAREHOLDERS TO BE HELD ON MAY 28, 2026
PROXY CARD
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF TEVA
Teva’s Board of Directors recommends that you vote FOR all proposals. If you execute and return this proxy card without indicating any directions with respect to any or all matter(s), this proxy card will be voted FOR such proposal(s).
Information in respect of the undersigned:
Shareholder name:
Number of identity card or passport (country) or corporation number (country):
Number of Teva ordinary shares being voted:
The undersigned hereby constitutes and appoints each of DOV BERGWERK, DIKLA TADMOR, SHIRA ARAN-PORAT and MATAN KIMCHI, acting individually, the true and lawful attorney, agent and proxy of the undersigned, with full power of substitution, to vote with respect to the number of shares set forth above, standing in the name of the undersigned at the close of trading on the Record Date, at the 2026 Annual General Meeting of Shareholders, and at any and all adjournments thereof, with all the power that the undersigned would possess if personally present and especially (but without limiting the general authorization and power hereby given) to vote as instructed on the reverse side.
In order to be counted, a duly executed proxy must be received by Teva by 3:00 p.m., Israel time, on May 27, 2026 (if not revoked prior to such time), unless determined otherwise by the chairman of the meeting, by submitting this proxy card to Teva’s executive offices at 124 Dvora HaNevi’a Street, Tel Aviv, 6944020, Israel to the attention of the Company Secretary or by email to TevaAGM2026@tevapharm.com.
In order to be counted, in addition to this proxy card: (i) shareholders registered in Teva’s shareholder register (Registered Holders) must also provide Teva with a copy of such Registered Holder’s identity card, passport or certificate of incorporation, as the case may be; and (ii) a shareholder registered pursuant to Section 177(1) of the Israeli Companies Law, 5759-1999, through a nominee company(Non-Registered Holders) must also provide Teva with an ownership certificate confirming such Non-Registered Holder’s ownership of Teva’s ordinary shares on the Record Date, which certificate must be approved by a member of the Tel Aviv Stock Exchange, as required by the Israeli Companies Regulations (Proof of Share Ownership for Voting at a General Meeting), 5760-2000. Non-Registered Holders may alternatively submit their votes through the electronic voting system of the Israeli Securities Authority athttps//:votes.isa.gov.il.
This proxy card, when properly executed, will be voted in the manner directed herein by the undersigned. Any and all proxies heretofore given are hereby revoked.
(Continued and to be signed on the reverse side)
PLEASE COMPLETE, SIGN, DATE AND RETURN PROMPTLY
| Matter on the Agenda: | Please vote by marking “X” in thecorrect box | |||
| For | Against | Abstain | ||
| 1. | TO APPOINT DR. SOL J. BARER TO SERVE AS A DIRECTOR UNTIL TEVA’S 2029 ANNUAL MEETING OF SHAREHOLDERS | |||
| 2. | TO APPROVE, ON A NON-BINDING ADVISORY BASIS, THE COMPENSATION FOR TEVA’S NAMED EXECUTIVE OFFICERS | |||
| 3. | TO APPOINT KESSELMAN & KESSELMAN, A MEMBER OF PRICEWATERHOUSECOOPERS INTERNATIONAL LTD., AS TEVA’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM UNTIL TEVA’S 2027 ANNUAL MEETING OF SHAREHOLDERS | |||
| Signature | Date |
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