Teva Pharma stock gets Buy rating from Goldman Sachs on positive drug data

Teva Pharmaceutical Industries (TEVA) reported positive Phase 3 trial data for its long-acting injectable (LAI) olanzapine for schizophrenia, demonstrating no Post-Injection Delirium/Sedation Syndrome (PDSS), which significantly bolsters its commercial prospects and prompted Goldman Sachs to maintain a Buy rating with a $25 price target and an estimated $4 billion NPV. Further expanding its portfolio, Teva launched the first generic GLP-1 drug, Saxenda, for weight loss. While Q2 2025 earnings per share of $0.66 exceeded analyst expectations, the company's revenue of $4.2 billion slightly missed forecasts.

Analysis

Teva Pharmaceutical Industries is demonstrating significant progress in its high-value drug pipeline, underscored by positive Phase 3 trial data for its long-acting injectable (LAI) olanzapine for schizophrenia. The SOLARIS trial reported no cases of Post-Injection Delirium/Sedation Syndrome (PDSS), a critical safety milestone that could eliminate restrictive patient monitoring requirements and accelerate commercial adoption. This result underpins Goldman Sachs' reiteration of a 'Buy' rating and a $25 price target, with their projection of $1.5 billion in peak U.S. sales notably doubling the Visible Alpha consensus of $750 million. Teva itself has guided for $1.5 billion to $2 billion in peak sales for its LAI franchise, identifying the European market as a key growth driver. Further bolstering its growth profile, Teva has launched the first generic version of the GLP-1 weight-loss drug Saxenda, securing a first-mover advantage in this high-demand therapeutic area. These positive developments are partially offset by a mixed second-quarter 2025 financial report, where an earnings per share beat ($0.66 vs. $0.63 consensus) was coupled with a revenue miss ($4.2 billion vs. $4.28 billion forecast).

Key Decisions for Investors

• Investors should re-evaluate Teva's valuation in light of the de-risked LAI olanzapine, noting the significant valuation gap between Goldman Sachs' $1.5 billion peak sales forecast and the $750 million market consensus.
• The first-to-market launch of a generic GLP-1 drug (Saxenda) presents a new, material revenue opportunity that warrants monitoring for market uptake and its impact on the company's growth profile.
• While pipeline news is positive, the recent Q2 revenue miss requires investors to maintain scrutiny on the company's ability to achieve consistent top-line growth and execute on its commercial strategy.