Business in Brief: Teva Reaches $135m Settlement With Illinois Over Wholesale Drug Prices

Ex-Air Force chief Ido Nechustan joins medical-marijuana company CanAssure ■ Hapoalim, Mizrahi seen taking $410m charge in fourth quarter for U.S. tax probe

FILE PHOTO: A man cleans near the logo of Teva Pharmaceutical Industries at their plant in Jerusalem December 14, 2017.
Ammar Awad/ REUTERS

Ex-Air Force chief Ido Nechustan joins medical-marijuana company CanAssure

Israel’s budding medical marijuana industry has recruited another top former military officer as chairman. After former army Chief of Staff and Prime Minister Ehud Barak took the top job at InterCure, CannAssure said on Sunday that it had tapped Ido Nechustan for the same post. CannAssure outgoing chairman Nir Peles said Nechustan, who was commander of the Israel Air Force from 2008 to 2012, would contribute to the company with his “extensive experience in leading strategic expansion processes.” CannAssure shares rose 29% to 2.61 shekels (71 cents) on Sunday. Meanwhile, Panaxia — a medical-cannabis company due to begin trading on the Tel Aviv Stock Exchange after it merges with shell company Herodium Investments — said it had won unspecified millions of shekels of investments from investor Zvika Barenboim. Barenboim’s investment will add credibility to Panaxia as he is a controlling shareholder in the private hospital NARA Medical Center. Herodium shares ended up 6.3% at 3.89 shekels (Guy Erez)

Teva reaches $135 million settlement with Illinois over wholesale drug prices

Teva Pharmaceuticals has agreed to pay $135 million to resolve a long-running lawsuit alleging that the Israeli generic drug maker defrauded Illinois’ Medicaid program by overstating the wholesale price of its prescription drugs. Illinois Attorney General Lisa Madigan announced the settlement on Thursday. This is the latest agreement stemming from a 2005 lawsuit in Cook County Circuit Court alleging that various drug makers misreported what pharmacies paid for their drugs. Teva denied the allegations, but agreed to settle to put an end to the suit. The company faces two other actions in the United States that could cost it similarly big sums. The first alleges that Teva and other pharma companies violated state laws and saddled Ohio’s Medicaid program with “excessive” costs for opioid drugs. Another alleges that Teva and 17 other companies fixed prices and dividing up the market for 300 generic drugs. Teva shares ended up 2.1% at 67.05 shekels ($18.26) in Tel Aviv. (Yoram Gabison)

Hapoalim, Mizrahi seen taking $410 million charge in fourth quarter for U.S. tax probe

Bank Hapoalim and Mizrahi Tefahot Bank will together take charges of some 1.5 billion shekels ($410 million) in the fourth quarter connected with the U.S. tax investigation against them, the investment house Excellence forecast in a report on Sunday. “Mizrahi Tefahot, and perhaps even Hapoalim, will try to reach settlements with the U.S. authorities over the next few months,” said banking analyst Micha Goldberg. As a result, we believe that the two banks will already book most of the costs in the [2018] fourth quarter.”  He estimated that Hapoalim would make a provision of 850 million shekels and Mizrahi 670 million shekels. Apart from that, Goldberg said Israeli banks would enjoy a good year in 2019, with operating profit rising 16% over 2018. His estimate doesn’t include provisions for the tax probe or gains for Hapoalim and Bank Leumi from the government-ordered sale of their credit card units. Goldberg gave all the bank a Buy rating, except for Hapoalim.  (Michael Rochvarger)

Tel Aviv shares extend losses in light trading

Tel Aviv shares extended their drops from the end of last week in light trading on Sunday. The TA-35 and TA-125 indices both finished down about 0.45% at 1,491.88 and 1,354.39 points, respectively, as just 446 million shekels ($121 million) in shares changed hands. Bezeq group shares fell again, with B Communications marking it fourth straight session of sharp declines with a 5.7% fall to 5.69 shekels. Bezeq itself was down 1.45% at 3.40. Israel Chemicals fell 1.5% to 20.69, Gazit Globe 3.4% to 26.85 and Norstar 3.4% to 41.73. Unitronics finished up 4.9% at 23.82 after it announced a $13.5 million contract to build an automated parking garage in New York City. Energix fell 0.2% to 4.75 after it issued 22 million new shares, equal to 5.3% of the company (diluted), to institutional investors, at 4.70 shekels each. Opko Health led TA-125 gainers, adding 4.9% to 13.89 and Perrigo was up 1.5% to 165 shekels.  (Eran Azran)