TEVA PHARMACEUTICAL INDUSTRIES LTD

Comparison of Three Months Ended March 31, 2026 to Three Months Ended March 31, 2025

Segment Information

United States Segment

The following table presents revenues, expenses and profit for our United States segment for the three months ended March 31, 2026 and 2025:

United States Revenues

In alignment with our Pivot to Growth strategy, commencing January 1, 2026, Anda is no longer reported under our United States segment. This shift allows the United States segment to continue to manage its entire product portfolio in the region, while strengthening focus on its biopharmaceutical business, growth engines and innovation. As a result, from that date, Anda is reported as part of the Company’s Other Activities. Prior period amounts were recast to reflect this change. See note 15 to our consolidated financial statements.

Revenues from our United States segment in the first quarter of 2026 were $1,534 million, flat compared to the first quarter of 2025, mainly due to lower revenues from generic products, primarily lenalidomide capsules (the generic version of Revlimid®), offset by higher revenues from our key innovative products, primarily AUSTEDO.

The following table presents revenues for our United States segment by major products and activities for the three months ended March 31, 2026 and 2025:

Generic products (including biosimilar products) revenues in our United States segment in the first quarter of 2026 were $612 million, a decrease of 28% compared to the first quarter of 2025. This decrease was mainly driven by lower revenues from lenalidomide capsules (the generic version of Revlimid®) due to increased generic competition in the U.S., partially offset by higher revenues from our portfolio of biosimilar products.

Among the most significant generic products we sold in the United States in the first quarter of 2026 were Truxima® (the biosimilar to Rituxan®), epinephrine injectable solution (the generic equivalent of EpiPen® and EpiPen Jr®) and SIMLANDI® (the biosimilar to Humira®). In the first quarter of 2026, our total prescriptions were approximately 246 million (based on trailing twelve months), representing 6.3% of total U.S. generic prescriptions, compared to approximately 273 million (based on trailing twelve months), representing 7.1% of total U.S. generic prescriptions in the first quarter of 2025, all according to IQVIA data.

AJOVY revenues in our United States segment in the first quarter of 2026 were $87 million, an increase of 64% compared to the first quarter of 2025, mainly due to a reduction in sales allowance. In the first quarter of 2026, AJOVY’s exit market share in the United States in terms of total number of prescriptions was 32.0% out of the subcutaneous injectable anti- CGRP class, compared to 30.2% in the first quarter of 2025.

AJOVY was launched in the United States in 2018 for the preventive treatment of migraine in adults, and in August 2025, the FDA approved AJOVY for the preventive treatment of episodic migraine in children and adolescent patients aged 6 to 17 years. AJOVY is the only anti-CGRP subcutaneous product indicated for both quarterly and monthly dosing options. AJOVY faces competition from multiple other products.

AJOVY is protected worldwide by patents expiring in 2026 at the earliest; extensions have been granted in several countries, including the United States and in Europe, until 2031. Additional patents relating to the use of AJOVY in the treatment of migraine have also been issued in the United States and in Europe and will expire between 2035 and 2039. Such patents are also pending in other countries. AJOVY will also be protected by regulatory exclusivity for 12 years from marketing approval in the United States (obtained in September 2018) and 10 years from marketing approval in Europe (obtained in April 2019). For our patent litigation related to other anti-CGRP products, see note 10 to our consolidated financial statement.

AUSTEDO revenues (which include AUSTEDO XR®) in our United States segment in the first quarter of 2026 were $559 million, an increase of 41%, compared to the first quarter of 2025. This increase was mainly due to growth in volume.

During 2025, Teva and the Centers for Medicare and Medicaid Services (“CMS”) negotiated a maximum fair price for AUSTEDO and AUSTEDO XR, based on their inclusion in CMS’s list of prescription medicines selected for price-setting discussions. An agreement was announced by CMS in November 2025. The revised prices set by the U.S. Government will become effective on January 1, 2027 and will apply to eligible Medicare patients.

AUSTEDO was launched in the United States in 2017. It is indicated for the treatment of chorea associated with Huntington’s disease and for the treatment of tardive dyskinesia in adults.

AUSTEDO is protected in the United States by 14 Orange Book patents expiring between 2031 and 2038. We received notice letters from two ANDA filers regarding the filing of their ANDAs with paragraph (IV) certifications for certain of the patents listed in the Orange Book for AUSTEDO. In 2022, we reached agreements with Lupin and Aurobindo, respectively, to sell their generic products beginning in April 2033, or earlier under certain circumstances. On March 9, 2022, the U.S. Patent and Trial Appeal Board of the U.S. Patent and Trademark Office declined to institute an IPR filed by Apotex regarding the deutetrabenazine compound patent. Currently, there are no further patent litigations pending regarding AUSTEDO.

AUSTEDO XR (deutetrabenazine) extended-release tablets was approved by the FDA on February 17, 2023 in three doses of 6, 12 and 24 mg, and became commercially available in the U.S. in May 2023. The FDA approved AUSTEDO XR as a one pill, once-daily treatment option in doses of 30, 36, 42, and 48 mg in May 2024 and in 18 mg in July 2024. AUSTEDO XR is a once-daily formulation indicated in adults for tardive dyskinesia and chorea associated with Huntington’s disease, which is additional to the twice-daily AUSTEDO. AUSTEDO XR is protected by 11 Orange Book patents expiring between 2031 and 2041.

UZEDY (risperidone) extended-release injectable suspension revenues in our United States segment in the first quarter of 2026 were $63 million, an increase of 62% compared to the first quarter of 2025, mainly due to growth in volume.

UZEDY was approved by the FDA on April 28, 2023 for the treatment of schizophrenia in adults, and was launched in the U.S. in May 2023. UZEDY is a subcutaneous, long-acting formulation that controls the steady release of risperidone. UZEDY is protected by six Orange Book patents expiring between 2027 and 2042. On October 10, 2025, it was announced that the FDA approved UZEDY as a once-monthly extended-release injectable suspension as monotherapy or as adjunctive therapy to lithium or valproate for the maintenance treatment of bipolar 1 disorder(BD-1) in adults. UZEDY is protected by regulatory exclusivity until April 28, 2026. We are evaluating plans to launch UZEDY in other countries around the world. UZEDY faces competition from multiple products.

BENDEKAand TREANDA combined revenues in our United States segment in the first quarter of 2026 were $27 million, a decrease of 26% compared to the first quarter of 2025, mainly due to competition from alternative therapies, as well as from generic bendamustine products.

In April 2019, we signed an amendment to the license agreement with Eagle Pharmaceuticals, Inc. (“Eagle”) extending the royalty term applicable to the United States to the full period for which we sell BENDEKA and increased the royalty rate. In consideration, Eagle agreed to assume a portion of BENDEKA-related patent litigation expenses.

There are 20 patents listed in the U.S. Orange Book for BENDEKA, one of which expired in 2026 and the rest with expiration dates in 2031. In August 2021, the Court of Appeals for the Federal Circuit affirmed the district court’s decision upholding the validity of all of the asserted patents and finding infringement by two remaining ANDA filers. Another ANDA filer did not join the appeal, and Teva also settled with two ANDA filers.

Teva also settled litigation against four 505(b)(2) applicants: Hospira, Inc. (“Hospira”), Dr. Reddy’s Laboratories (“DRL”) and Accord Healthcare (“Accord”), and Almaject, Inc. / Alvogen, Inc. (“Almaject”). Based on these settlement agreements, Hospira, Accord, DRL and Almaject can launch their products on November 17, 2027, or earlier under certain circumstances. In 2023, Teva and Eagle also filed suit against BendaRx Corp. in the U.S. District Court for the District of Delaware, following its filing of a 505(b)(2) NDA for a bendamustine product, and that litigation is still pending, though it is currently stayed.

In addition to the settlement with Eagle regarding its bendamustine 505(b)(2) NDA, between 2015 and 2020, we reached final settlements with 22 ANDA filers for generic versions of the lyophilized form of TREANDA and one 505(b)(2) NDA filer for a generic version of the liquid form of TREANDA, providing for the launch of generic versions of TREANDA prior to patent expiration. Currently, there are multiple generic TREANDA products on the market.

COPAXONE revenues in our United States segment in the first quarter of 2026 were $62 million, an increase of 16% compared to the first quarter of 2025, mainly due to a reduction in sales allowance, partially offset by lower volumes.

COPAXONE continues to face competition from existing alternative therapies, generic versions of COPAXONE, and generic treatments for multiple sclerosis, injectable products, as well as from monoclonal antibodies.

Product Launches and Pipeline

In the first quarter of 2026, we launched the generic version of the following branded products in the United States:

As of March 31, 2026, our generic products pipeline in the United States includes 112 product applications awaiting FDA approval, including 65 tentative approvals. This total reflects all pending ANDAs, supplements for product line extensions and tentatively approved applications and includes some instances where more than one application was submitted for the same reference product. Excluding overlaps, the branded products underlying these pending applications had U.S. sales for the twelve months ended December 31, 2025 of approximately $128 billion, according to IQVIA. Approximately 81% of pending applications include a paragraph IV patent challenge, and we believe we arefirst-to-file with respect to 53 of these products, or 76 products including final approvals where launch is pending a settlement agreement or court decision. Collectively, these first-to-file opportunities represent over $84 billion in U.S. brand sales for the twelve months ended December 31, 2025, according to IQVIA.

IQVIA reported brand sales are one of the many indicators of future potential value of a launch, but equally important are the mix and timing of competition, as well as cost effectiveness. The potential advantages of being the first filer with respect to some of these products may be either forfeited, or subject to shared exclusivity or competition fromso-called “authorized generics,” which may ultimately affect the value derived.

In the first quarter of 2026, we did not receive any tentative approvals for generic products. A “tentative approval” indicates that the FDA has substantially completed its review of an application and final approval is expected once the relevant patent expires, a court decision is reached, a 30-month regulatory stay lapses or a 180-day exclusivity period awarded to another manufacturer either expires or is forfeited.

For information regarding our innovative and biosimilar products pipeline, see “—Teva Consolidated Results—Research and Development (R&D) Expenses, net” below.

United States Gross Profit

Gross profit from our United States segment in the first quarter of 2026 was $1,038 million, an increase of 2%, compared to the first quarter of 2025.

Gross profit margin for our United States segment in the first quarter of 2026 increased to 67.7%, compared to 65.9% in the first quarter of 2025. This increase was mainly due to higher revenues from AUSTEDO, partially offset by lower revenues from generic products, primarily lenalidomide capsules (the generic version of Revlimid®).

United States R&D Expenses

R&D expenses relating to our United States segment in the first quarter of 2026 were $147 million, a decrease of 5%, compared to the first quarter of 2025.

United States S&M Expenses

S&M expenses relating to our United States segment in the first quarter of 2026 were $298 million, an increase of 22%, compared to the first quarter of 2025. This increase was mainly due to promotional activities related to our key innovative products, primarily AUSTEDO.

United States G&A Expenses

G&A expenses relating to our United States segment in the first quarter of 2026 were $90 million, a decrease of 5% compared to the first quarter of 2025.

United States Profit

Profit from our United States segment consists of revenues less cost of sales, R&D expenses, S&M expenses, G&A expenses and other expenses (income) related to this segment. Segment profit does not include amortization and certain other items.

Profit from our United States segment in the first quarter of 2026 was $507 million, a decrease of 2%, compared to the first quarter of 2025. This decrease was mainly due to higher S&M expenses, partially offset by higher gross profit, as discussed above.

Europe Segment

The following table presents revenues, expenses and profit for our Europe segment for the three months ended March 31, 2026 and 2025:

Europe Revenues

Our Europe segment includes the European Union, the United Kingdom and certain other European countries.

Revenues from our Europe segment in the first quarter of 2026 were $1,340 million, an increase of 12% compared to the first quarter of 2025. In local currency terms, revenues decreased by 1% compared to the first quarter of 2025, mainly due to lower revenues from generic products, partially offset by higher revenues from AJOVY.

In the first quarter of 2026, revenues were positively impacted by exchange rate fluctuations of $159 million, including hedging effects, compared to the first quarter of 2025. Revenues in the first quarter of 2026, included $10 million from a positive hedging impact, which is included in “Other” in the table below. Revenues in the first quarter of 2025 included $12 million from a negative hedging impact, which is included in “Other” in the table below. See note 8c to our consolidated financial statements.

The following table presents revenues for our Europe segment by major products and activities for the three months ended March 31, 2026 and 2025:

Generic products revenues (including OTC and biosimilar products) in our Europe segment in the first quarter of 2026, were $1,089 million, an increase of 10% compared to the first quarter of 2025. In local currency terms, revenues decreased by 1%, mainly due to lower sales of seasonal OTC products, partially offset by higher revenues from recently launched products.

AJOVY revenues in our Europe segment in the first quarter of 2026 were $76 million, an increase of 31%, compared to the first quarter of 2025. In local currency terms, revenues increased by 17% due to growth in volume.

For information about AJOVY patent protection, see “—United States Revenues—Revenues by Major Products and Activities” above.

COPAXONE revenues in our Europe segment in the first quarter of 2026 were $40 million, a decrease of 4% compared to the first quarter of 2025. In local currency terms, revenues decreased by 14%, mainly due to price reductions and lower volumes resulting from the availability of alternative therapies.

Respiratory products revenues in our Europe segment in the first quarter of 2026 were $59 million, an increase of 8% compared to the first quarter of 2025. In local currency terms, revenues decreased by 2%, mainly due to net price reductions and lower volumes.

Product Launches and Pipeline

As of March 31, 2026, our generic products pipeline in Europe included 89 generic approvals relating to 19 compounds in 47 formulations. In addition, approximately 1,408 marketing authorization applications are pending approval in 37 European countries, relating to 94 compounds in 215 formulations. One application is pending with the European Medicines Agency (“EMA”).

For information regarding our innovative medicines and biosimilar products pipeline, see “—Teva Consolidated Results—Research and Development (R&D) Expenses, net” below.

Europe Gross Profit

Gross profit from our Europe segment in the first quarter of 2026 was $734 million, an increase of 12% compared to the first quarter of 2025.

Gross profit margin for our Europe segment in the first quarter of 2026 decreased to 54.8%, compared to 55.1% in the first quarter of 2025.

Europe R&D Expenses

R&D expenses relating to our Europe segment in the first quarter of 2026 were $45 million, a decrease of 25% compared to the first quarter of 2025.

Europe S&M Expenses

S&M expenses relating to our Europe segment in the first quarter of 2026 were $215 million, an increase of 8% compared to the first quarter of 2025. This increase was mainly due to a negative impact from exchange rate fluctuations.

Europe G&A Expenses

G&A expenses relating to our Europe segment in the first quarter of 2026 were $73 million, an increase of 6% compared to the first quarter of 2025. This increase was mainly due to a negative impact from exchange rate fluctuations.

Europe Profit

Profit from our Europe segment consists of revenues less cost of sales, R&D expenses, S&M expenses, G&A expenses and other expenses (income) related to this segment. Segment profit does not include amortization and certain other items.

Profit from our Europe segment in the first quarter of 2026 was $401 million, an increase of 22%, compared to the first quarter of 2025. This increase was mainly due to higher gross profit, as discussed above.

International Markets Segment

The following table presents revenues, expenses and profit for our International Markets segment for the three months ended March 31, 2026 and 2025:

International Markets Revenues

Our International Markets segment includes all countries in which we operate other than the United States and the countries included in our Europe segment. The International Markets segment covers a substantial portion of the global pharmaceutical industry, including more than 35 countries. The countries in our International Markets segment include highly regulated, mainly generic markets, such as Canada and Israel, and branded generics-oriented markets, such as Russia and certain Latin America markets.

On March 31, 2025, we divested our Teva-Takeda business venture in Japan, which included generic products and legacy products. Since the establishment of the business venture and until the completion of its sale, Teva held 51% of the outstanding common stock of the business venture. On March 31, 2025, we deconsolidated the business venture from our financial statements. For additional information, see note 2 to our consolidated financial statements.

As of the date of this Quarterly Report on Form 10-Q, sustained conflict between Russia and Ukraine and disruption in the region is ongoing. Russia and Ukraine markets are included in our International Markets segment results and we have no manufacturing or R&D facilities in these markets. In the first quarter of 2026, the impact of this conflict on our International Markets segment was immaterial.

Revenues from our International Markets segment in the first quarter of 2026 were $524 million, a decrease of 10% compared to the first quarter of 2025. In local currency terms, revenues decreased by 19% compared to the first quarter of 2025, mainly due to the divestment of our business venture in Japan.

In the first quarter of 2026, revenues were positively impacted by exchange rate fluctuations of $50 million, including hedging effects, compared to the first quarter of 2025. Revenues in the first quarter of 2026 included $1 million from a positive hedging impact, compared to a negative hedging impact of $15 million in the first quarter of 2025, which are included in “Other” in the table below. See note 8c to our consolidated financial statements.

The following table presents revenues for our International Markets segment by major products and activities for the three months ended March 31, 2026 and 2025:

Generic products revenues (including OTC and biosimilar products) in our International Markets segment in the first quarter of 2026 were $386 million, a decrease of 18% compared to the first quarter of 2025. In local currency terms, revenues decreased by 23%, mainly due to the divestment of our business venture in Japan.

AJOVY revenues in our International Markets segment in the first quarter of 2026 were $33 million, an increase of 20% compared to the first quarter of 2025. In local currency terms, revenues increased by 15%, mainly due to growth in existing markets in which AJOVY was launched. AJOVY was launched in certain markets in our International Markets segment, including in Canada, Japan, Australia, Israel, South Korea, Brazil and others. In April 2026, we announced a strategic partnership for the marketing and distribution of AJOVY in China with Neurogen (Zhuhai) Pharmaceutical Company Ltd.

AUSTEDO revenues in our International Markets segment in the first quarter of 2026 were $19 million, an increase of 30% compared to the first quarter of 2025. In local currency terms, revenues increased by 22% compared to the first quarter of 2025. AUSTEDO was launched in China and Israel in 2021 and in Brazil in 2022, for the treatment of chorea associated with Huntington’s disease and for the treatment of tardive dyskinesia. In February 2024, we announced a strategic partnership for the marketing and distribution of AUSTEDO in China with Jiangsu Nhwa Hexin Pharmaceutical Marketing Co., Ltd. In April 2025, AUSTEDO received marketing authorization in South Korea. We continue to evaluate additional submissions in various other markets.

COPAXONE revenues in our International Markets segment in the first quarter of 2026 were $6 million, a decrease of 43% compared to the first quarter of 2025.

International Markets Gross Profit

Gross profit from our International Markets segment in the first quarter of 2026 was $243 million, a decrease of 12% compared to the first quarter of 2025.

Gross profit margin for our International Markets segment in the first quarter of 2026 decreased to 46.4%, compared to 47.7% in the first quarter of 2025. This decrease was mainly due to unfavorable mix of products, partially offset by a positive impact from hedging activities.

International Markets R&D Expenses

R&D expenses relating to our International Markets segment in the first quarter of 2026 were $22 million, a decrease of 11% compared to the first quarter of 2025.

International Markets S&M Expenses

S&M expenses relating to our International Markets segment in the first quarter of 2026 were $117 million, a decrease of 1% compared to the first quarter of 2025.

International Markets G&A Expenses

G&A expenses relating to our International Markets segment in the first quarter of 2026 were $39 million, flat compared to the first quarter of 2025.

International Markets Profit

Profit from our International Markets segment consists of revenues less cost of sales, R&D expenses, S&M expenses, G&A expenses and other expenses (income) related to this segment. Segment profit does not include amortization and certain other items.

Profit from our International Markets segment in the first quarter of 2026 was $65 million, a decrease of 33%, compared to the first quarter of 2025. This decrease was mainly due to lower gross profit, as discussed above.

Other Activities

We have other sources of revenues, primarily the sale of APIs to third parties, certain contract manufacturing services and anout-licensing platform offering a portfolio of products to other pharmaceutical companies through our affiliate Medis. Our Other Activities are not included in our United States, Europe or International Markets segments described above.

In alignment with our Pivot to Growth strategy, commencing January 1, 2026, Anda is no longer reported under our United States segment. This shift allows the United States segment to continue to manage its entire product portfolio in the region, while strengthening focus on its biopharmaceutical business, growth engines and innovation. As a result, from that date, Anda is reported as part of the Company’s Other Activities. Prior period amounts were recast to reflect this change. See note 15 to our consolidated financial statements.

On January 31, 2024, we announced that we intend to divest our API business (including its R&D, manufacturing and commercial activities) through a sale. The intention to divest is in alignment with our Pivot to Growth strategy, and Teva is conducting a sales process for this matter. However, there can be no assurance regarding the ultimate timing or structure of a potential divestiture or that a divestiture will be agreed or completed at all. For further information, see note 2 to our consolidated financial statements.

Our revenues from Other Activities in the first quarter of 2026 were $584 million, an increase of 1% in U.S. dollars compared to the first quarter of 2025. In local currency terms, revenues decreased by 1% compared to the first quarter of 2025.

Anda revenues from third-party products in the first quarter of 2026 were $378 million, an increase of 1%, compared to the first quarter of 2025. Anda, our distribution business in the United States, operates independently and distributes generic and innovative medicines and OTC pharmaceutical products from various manufacturers to independent retail pharmacies, pharmacy retail chains, hospitals and physician offices in the United States. Anda competes in the distribution market by maintaining a broad portfolio of products, competitive pricing and delivery throughout the United States.

API sales to third parties in the first quarter of 2026 were $109 million, a decrease of 17% in both U.S. dollars and local currency terms, compared to the first quarter of 2025. This decrease was mainly due to price reductions and lower demand due to market dynamics.

Revenues from additional other activities, mainly from Medis and certain contract manufacturing services, in the first quarter of 2026 were $97 million, an increase of 28% in U.S. dollars compared to the first quarter of 2025. In local currency terms, revenues increased by 16% compared to the first quarter of 2025, mainly due to higher demand.

Teva Consolidated Results

Revenues

Revenues in the first quarter of 2026 were $3,982 million, an increase of 2% in U.S. dollars, or a decrease of 3% in local currency terms compared to the first quarter of 2025. This decrease in local currency terms was mainly due to lower revenues from generic products, primarily lenalidomide capsules (the generic version of Revlimid®) in our U.S. segment as well as the divestment of our business venture in Japan in our International Markets segment, partially offset by higher revenues from our key innovative products, primarily AUSTEDO.

See “—United States Revenues,” “—Europe Revenues,” “—International Markets Revenues” and “—Other Activities” above.

Exchange rate movements in the first quarter of 2026, including hedging effects, positively impacted revenues by $219 million, compared to the first quarter of 2025. See note 8c to our consolidated financial statements.

Gross Profit

Gross profit in the first quarter of 2026 was $1,972 million, an increase of 5% compared to $1,877 million in the first quarter of 2025.

Gross profit margin was 49.5% in the first quarter of 2026, compared to 48.2% in the first quarter of 2025. This increase was mainly due to higher revenues from AUSTEDO, partially offset by lower revenues from generic products in our U.S. segment, primarily lenalidomide capsules (the generic version of Revlimid®).

Research and Development (R&D) Expenses, net

Our R&D activities for innovative medicines and biosimilar products in each of our segments include costs of discovery research, preclinical work, drug formulation, early- and late-stage clinical development and product registration costs. These expenditures are reported net of contributions received from collaboration partners. Our spending takes place throughout the development process, including (i) early-stage projects in both discovery and preclinical phases; (ii) middle-stage projects in clinical programs up to Phase 3; (iii) late-stage projects in Phase 3 programs, including where a new drug application is currently pending approval; (iv) post-approval studies for marketed products; and (v) indirect expenses, such as costs of infrastructure and personnel.

Our R&D activities for generic products in each of our segments include both (i) direct expenses relating to product formulation, analytical method development, stability testing, management of bioequivalence and other clinical studies and regulatory filings; and (ii) indirect expenses, such as costs of infrastructure and personnel.

In the first quarter of 2026, our R&D expenses, net, were primarily related to our innovative product pipeline in immunology, neuroscience and selected other areas, as well as our generics and biosimilars pipeline.

R&D expenses, net in the first quarter of 2026, were $222 million, a decrease of 10% compared to $247 million in the first quarter of 2025.

Our lower R&D expenses, net in the first quarter of 2026 compared to the first quarter of 2025, were mainly due to a decrease in our generics pipeline and in our late-stage innovative pipeline in neuroscience, partially offset by an increase in immunology projects.

Our R&D expenses, net in the first quarter of 2026 and 2025, were also impacted by reimbursements and cost sharing from our strategic partnerships and collaborations entered into in recent years. See note 2 to our consolidated financial statements.

R&D expenses, net as a percentage of revenues were 5.6% in the first quarter of 2026, compared to 6.3% in the first quarter of 2025.

Innovative Medicines Pipeline

Below is a description of key products in our innovative medicines pipeline as of April 29, 2026:

Biosimilar Products Pipeline

We have additional biosimilar products in development internally and with our partners that are in various stages of development, including confirmatory clinical trials for biosimilars to Entyvio® (vedolizumab) and Entyvio® SC (vedolizumab), which are in collaboration with Alvotech for the U.S. market; and TEV-‘333 and TEV-‘316, both in collaboration with mAbxience. Our proposed biosimilar to Xgeva® (denosumab) and our proposed biosimilars to Simponi®, Simponi Aria® (golimumab), and Eylea® (aflibercept), which are in collaboration with Alvotech, were submitted for regulatory review in the U.S. Our proposed biosimilar to Xolair® (omalizumab) was submitted for regulatory review in the U.S. and Europe.

Selling and Marketing (S&M) Expenses

S&M expenses in the first quarter of 2026, were $696 million, an increase of 12% compared to the first quarter of 2025. This increase was mainly a result of the factors discussed above under “—United States segment—S&M Expenses” and “—Europe segment— S&M Expenses.”

S&M expenses as a percentage of revenues were 17.5% in the first quarter of 2026, compared to 16.0% in the first quarter of 2025.

General and Administrative (G&A) Expenses

G&A expenses in the first quarter of 2026 were $304 million, an increase of 2% compared to the first quarter of 2025.

G&A expenses as a percentage of revenues were 7.6% in the first quarter of 2026, flat compared to the first quarter of 2025.

Intangible Asset Impairments

We recorded expenses of $8 million for identifiable intangible asset impairments in the first quarter of 2026, compared to expenses of $121 million in the first quarter of 2025. See note 5 to our consolidated financial statements.

Other Asset Impairments, Restructuring and Other Items

We recorded expenses of $26 million for other asset impairments, restructuring and other items in the first quarter of 2026, compared to an income of $22 million in the first quarter of 2025. See note 12 to our consolidated financial statements.

Legal Settlements and Loss Contingencies

We recorded expenses of $72 million in legal settlements and loss contingencies in the first quarter of 2026, compared to expenses of $86 million in the first quarter of 2025. See note 9 to our consolidated financial statements.

Other Loss (Income)

Other income in the first quarter of 2026 was $9 million, compared to other loss of $5 million in the first quarter of 2025.

Operating Income (Loss)

Operating income was $652 million in the first quarter of 2026, compared to $519 million in the first quarter of 2025. This increase was mainly due to lower intangible assets impairments and higher gross profit, partially offset by higher S&M expenses.

Operating income as a percentage of revenues was 16.4% in the first quarter of 2026, compared to 13.3% in the first quarter of 2025.

Financial Expenses, Net

In the first quarter of 2026, financial expenses, net were $216 million, mainly comprised of net interest expenses of $201 million. In the first quarter of 2025, financial expenses, net were $225 million, mainly comprised of net interest expenses of $212 million.

Reconciliation Table to Consolidated Income (Loss) Before Income Taxes

The following table presents a reconciliation of our segment profits to our consolidated operating income (loss) and to consolidated income (loss) before income taxes for the three months ended March 31, 2026 and 2025:

Income Taxes

In the first quarter of 2026, we recognized a tax expense of $67 million onpre-tax income of $437 million. In the first quarter of 2025, we recognized a tax expense of $74 million onpre-tax income of $294 million. See note 11 to our consolidated financial statements.

Net Income (Loss) Attributable to Teva

Net income attributable to Teva was $369 million in the first quarter of 2026, compared to $214 million in the first quarter of 2025. This increase was mainly due to higher operating income as discussed above.

Diluted Shares Outstanding and Earnings (Loss) per Share

The weighted average diluted shares outstanding used for the fully diluted share calculations for the three months ended March 31, 2026 and 2025 was 1,179 million shares and 1,159 million shares, respectively.

Diluted earnings per share was $0.31 in the first quarter of 2026, compared to $0.18 in the first quarter of 2025. See note 13 to our consolidated financial statements.

Share Count for Market Capitalization

We calculate share amounts using the outstanding number of shares (i.e., excluding treasury shares) plus shares that would be outstanding upon the exercise of options and vesting of RSUs and PSUs, and the conversion of our convertible senior debentures, in each case, at period end.

As of March 31, 2026 and 2025, the fully diluted share count for purposes of calculating our market capitalization was approximately 1,192 million shares and 1,178 million shares, respectively.

Impact of Currency Fluctuations on Results of Operations

In the first quarter of 2026, approximately 48% of our revenues were denominated in currencies other than the U.S. dollar. Since our results are reported in U.S. dollars, we are subject to significant foreign currency risks. Accordingly, changes in the rate of exchange between the U.S. dollar and local currencies in the markets in which we operate (primarily the euro, Swiss franc, Russian ruble, British pound, new Israeli shekel, Polish złoty, Canadian dollar and Swedish krona) impacted our results.

During the first quarter of 2026, the following main currencies relevant to our operations increased in value against the U.S. dollar (each compared on a quarterly average basis): Russian ruble by 20%, Hungarian forint by 18%, Swedish krona by 17%, new Israeli shekel by 16%, Swiss franc by 15%, euro by 11%, Polish złoty by 11% and British pound by 7%. The following currencies relevant to our operations decreased in value against the U.S. dollar (each compared on a quarterly average basis): Argentinian peso by 26%, Indian rupee by 5% and Ukrainian hryvna by 4%.

As a result, exchange rate movements during the first quarter of 2026, including hedging effects, positively impacted revenues by $219 million and operating income by $71 million, compared to the first quarter of 2025.

Hedging transactions of future projected revenues and expenses are recognized on the balance sheet at their fair value on a quarterly basis, while the foreign exchange impact on the underlying revenues and expenses may occur in subsequent quarters. See note 8c to our consolidated financial statements.

Commencing in the third quarter of 2018, the cumulative inflation in Argentina exceeded 100% or more over a three-year period. Although this triggered highly inflationary accounting treatment, it did not have a material impact on our results of operations.

Commencing in the second quarter of 2022, the cumulative inflation in Turkey exceeded 100% or more over a three-year period. Although this triggered highly inflationary accounting treatment, it did not have a material impact on our results of operations.

Liquidity and Capital Resources

Total balance sheet assets were $40,040 million as of March 31, 2026, compared to $40,748 million as of December 31, 2025.

Our working capital balance, which includes accounts receivables net of SR&A, inventories, prepaid expenses and other current assets, accounts payables, employee-related obligations, accrued expenses and other current liabilities, was negative $2,411 million as of March 31, 2026, compared to negative $2,733 million as of December 31, 2025. This change was mainly due to a decrease in employee-related obligations as discussed below, and an increase in accounts receivables, net of SR&A. We continue our efforts to optimize our working capital management.

Employee-related obligations, as of March 31, 2026 were $555 million, compared to $739 million as of December 31, 2025. The decrease in the first three months of 2026 was mainly due to performance incentive payments to employees for 2025, partially offset by an accrual for performance incentive payments to employees for 2026.

Cash investment in property, plant and equipment and intangible assets in the first quarter of 2026 was $168 million, compared to $127 million in the first quarter of 2025. Depreciation in the first quarter of 2026 was $102 million, compared to $99 million in the first quarter of 2025.

Cash and cash equivalents as of March 31, 2026, were $3,741 million, compared to $3,556 million as of December 31, 2025. See also the statement of cash flows included in our consolidated financial statements.

Our cash on hand that is not used for ongoing operations is generally invested in bank deposits as well as liquid securities that bear fixed and floating rates.

Teva’s principal sources of short-term liquidity are its cash on hand, existing cash investments, liquid securities and available credit facilities, primarily its $1.8 billion unsecured syndicated sustainability-linked revolving credit facility, entered into in April 2022, as amended most recently in December 2025 (“RCF”). See note 7 to our consolidated financial statements.

Debt Balance and Movements

As of March 31, 2026, our debt was $16,627 million, compared to $16,807 million as of December 31, 2025. This decrease was mainly due to $174 million of exchange rate fluctuations.

In February 2026, we repaid $23 million of the 0.25% convertible senior debentures at maturity.

Our debt as of March 31, 2026 was 57% denominated in U.S. dollars, with the remainder denominated in euro.

The portion of total debt classified as short-term as of March 31, 2026 was 16% compared to 11% as of December 31, 2025.

Our financial leverage, which is the ratio between our debt and the sum of our debt and equity, was 67% as of March 31, 2026, compared to 68% as of December 31, 2025. Our average debt maturity was approximately 5.4 years as of March 31, 2026, compared to 5.6 years as of December 31, 2025.

Total Equity

Total equity was $8,232 million as of March 31, 2026, compared to $7,914 million as of December 31, 2025. This increase was mainly due to net income attributable to Teva of $369 million, partially offset by a negative impact from exchange rate fluctuations of $121 million.

Exchange rate fluctuations affected our balance sheet, as approximately 60% of our net assets as of March 31, 2026 (including both monetary andnon-monetary assets) were in currencies other than the U.S. dollar. When compared to December 31, 2025, changes in currency rates as of March 31, 2026, had a negative impact of $121 million on our equity. The following main currencies decreased in value against the U.S. dollar: Indian rupee by 5%, Peruvian nuevo by 4%, Polish złoty by 4%, Chilean peso by 4%, euro by 3%, Russian ruble by 2%, British pound by 2%, Canadian dollar by 2%, Japanese yen by 2%, Mexican peso by 1% and Swiss franc by 1%. All comparisons are on ayear-to-date basis.

Cash Flow

We continually seek to improve the efficiency of our working capital management. Periodically, as part of our cash and commercial relationship management activities, we make decisions in our commercial, supply chain, and other activities which drive an optimization of our inventory levels, an acceleration of receivable payments from customers, or deceleration of payments to vendors, including timing of payments related to legal settlements, tax authorities and other matters. These have the effect of increasing or decreasing cash from operations, as well as working capital balance items during any given period. Increased cash from operations has the effect of reducing our leverage ratio, which is measured net of cash and cash equivalents, as of the end of such period. In connection with these efforts, we are able to secure more favorable payment terms from many of our vendors which are expected to continue in future periods. In addition, in periods in which collections from customers are delayed, we have and expect we may in the future extend the time to pay certain vendors, so as to balance our liquidity position. Such decisions have had and may in the future have a material impact on our annual operating cash flow measurement and results of operations.

Cash flow used in operating activities during the first quarter of 2026 was $40 million compared to $105 million in the first quarter of 2025. The lower cash flow used in operating activities in the first quarter of 2026 was mainly due to favorable timing and mix of sales and collections in our U.S. segment as well as lower payments of interest, partially offset by higher performance incentive payments to employees.

During the first quarter of 2026, we generated free cash flow of $188 million, which we define as comprising: $40 million in cash flow used in operating activities, $354 million in beneficial interest collected in exchange for securitized accounts receivables (under our EU securitization program) and $42 million of proceeds from sale of businesses and long-lived assets, partially offset by $168 million in cash used for capital investments. During the first quarter of 2025, we generated free cash flow of $107 million, which we define as comprising: $105 million in cash flow used in operating activities, $322 million in beneficial interest collected in exchange for securitized accounts receivables (under our EU securitization program) and $17 million of proceeds from sale of businesses and long-lived assets, partially offset by $127 million in cash used for capital investments. The increase in the first quarter of 2026 resulted mainly from lower cash flow used in operating activities, as discussed above.

Dividends

We have not paid dividends on our ordinary shares or American Depositary Shares (ADSs) since December 2017.

Commitments

In addition to financing obligations under short-term debt and long-term senior notes and loans, debentures and convertible debentures, our major contractual obligations and commercial commitments include leases, royalty payments, contingent payments pursuant to acquisition agreements, collaboration agreements, development funding agreements and participation in joint ventures associated with R&D activities. For further information on these agreements see note 2 to our consolidated financial statements.

We are committed to paying royalties, subject to the terms of applicable agreements, to the owners ofknow-how, partners in alliances and certain other arrangements, and to parties that financed R&D at a wide range of rates as a percentage of sales of certain products, as defined in the agreements. In some cases, the royalty period is not defined under the applicable agreement; in other cases, royalties will be paid over various periods not exceeding 20 years.

In connection with certain development, supply and marketing, and research and collaboration or services agreements, we are required to indemnify, in unspecified amounts, the parties to such agreements against third-party claims relating to (i) infringement or violation of intellectual property or other rights of such third-party; or (ii) damages to users of the related products. Except as described in our financial statements, we are not aware of any material pending action that may result in the counterparties to these agreements claiming such indemnification.

Non-GAAP Net Income and Non-GAAP EPS Data

We presentnon-GAAP net income andnon-GAAP earnings per share (“EPS”) as management believes that such data provide useful information to investors because they are used by management and our Board of Directors, in conjunction with other performance metrics, to evaluate our operational performance, to prepare and evaluate our work plans and annual budgets and ultimately to evaluate the performance of management, including annual compensation. While other qualitative factors and judgment also affect annual compensation, the principal quantitative element in the determination of such compensation are performance targets tied to the work plan, which are based on thesenon-GAAP measures.

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 considernon-GAAP net income andnon-GAAP EPS in addition to, and not as replacements for, or superior to, measures of financial performance prepared in accordance with GAAP.

In preparing ournon-GAAP net income andnon-GAAP EPS data, we exclude items that either have anon-recurring impact on our financial performance or which, in the judgment of our management, are items that, either as a result of their nature or size, could, were they not excluded, potentially cause investors to extrapolate future performance from an improper base that is not reflective of our underlying business performance. Certain of these items are also excluded because of the difficulty in predicting their timing and scope. The items excluded from ournon-GAAP net income andnon-GAAP EPS include:

The following tables present ournon-GAAP net income andnon-GAAP EPS for the three months ended March 31, 2026 and 2025, as well as reconciliations of each measure to their nearest GAAP equivalents:

Off-Balance Sheet Arrangements

We do not have any materialoff-balance sheet arrangements, except for: (i) surety underwritten guarantees Teva has provided the European Commission in an amount of euro 462.2 million, together with specified post-decision interest, which remain in force for three years, and which includes substantially similar covenants as our RCF, as disclosed in note 7 to our consolidated financial statements, and (ii) securitization transactions, which are disclosed in note 10f to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2025.

Critical Accounting Policies

For a summary of our significant accounting policies, see note 1 to our consolidated financial statements and “Critical Accounting Policies” included in our Annual Report on Form 10-K for the year ended December 31, 2025.

Recently Issued Accounting Pronouncements

See note 1 to our consolidated financial statements.