Teva Pharmaceutical Industries Ltd (NYSE:TEVA), the world’s largest generic drugmaker, stock fell 1.74% (As on May 11, 11:31:46 AM UTC-4, Source: Google Finance) after the company is looking to a trio of branded drugs to drive future growth, as a bad miss in first-quarter profit sent its shares tumbling. The company has pointed to group’s branded Huntington’s disease treatment Austedo, migraine product Ajovy and the soon to be launched schizophrenia drug Uzedy to help Teva recover.

TEVA in the first quarter of FY 23 has reported the adjusted earnings per share of 40 cents, missing the analysts’ estimates for the adjusted earnings per share of 56 cents. The company had reported the adjusted revenue of $3.7 billion in the first quarter of FY 23, beating the analysts’ estimates for revenue of $3.63 billion, according to I/B/E/S data from Refinitiv. AUSTEDO was up 10%; and AJOVY, up 5%, driving that innovative business that I mentioned earlier. And in European generics, in local currency, we’re up 12%. In local currency and international markets were up 9%. So I think a solid performance for Q1 on the revenue. All regions were up in local currency or growth, 2% for North America; 9%, Europe; and 8%, international markets. Non-GAAP gross profit was $1,796 million in the first quarter of 2023, a decrease of 10% compared to the first quarter of 2022. Non-GAAP gross profit margin was 49.1% in the first quarter of 2023, compared to 54.2% in the first quarter of 2022. This decrease in both gross profit margin and non- GAAP gross profit margin was mainly driven by rising costs due to inflationary and other macroeconomic pressures, an increase in revenues with lower profitability from Anda in our North America segment, lower revenues from COPAXONE and BENDEKA and TREANDA, and an unfavorable impact of hedging activities, partially offset by higher revenues from AUSTEDO and AJOVY.

Despite missing on profit, which Teva blamed on inflation pressures that have begun to ease, it continued to project adjusted earnings per share (EPS) of $2.25-$2.55 and revenue of $14.8-$15.4 billion this year, versus adjusted EPS of $2.52 and revenue of $14.9 billion in 2022. The company estimates Teva’s Uzedy (risperidone) could win 10 to 20% of a $4 billion market.

Teva will maintain a significant generics business that will help generate cash and pay down debt. The company is trying to bounce back from a rough few years in which it lost exclusivity to its blockbuster multiple sclerosis drug Copaxone, saw a drop in generic prices in the United States, and fought a spate of lawsuits alleging it helped fuel the U.S. opioid epidemic.