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Executives

Elana Holzman – IR

Shlomo Yanai – President and CEO

Eyal Desheh – CFO

Gerard Van Odijk – President and CEO, Teva Europe

Bill Marth – President and CEO, Teva North America

Ben-Zion Weiner – Chief R&D Officer

Moshe Manor – Group VP, Global Branded Products

Analysts

Randall Stanicky – Goldman Sachs

Richard Silver – Barclays Capital

Chris Schott – JP Morgan Chase & Company

Ronny Gal – Sanford C. Bernstein and Co.

David Amsilumer – Hyper Jafford

Gregg Gilbert – Bank of America

David Buck – Buckingham Research Group

John Boris – Citigroup

Mark Goodman – UBS

Corey Davis with Jefferies & Co.

David Maris – Credit Agricole

Teva Pharmaceutical Industries Limited (TEVA) Q2 2010 Earnings Conference Call July 27, 2010 8:30 AM ET

Operator

Greetings and welcome to the Teva Pharmaceutical Industries Ltd. Second Quarter 2010 Results Conference Call. (Operator instructions) It is now my pleasure to introduce your host, Ms. Elana Holzman, Senior Director of Investor Relations. Thank you, Ms. Holzman, you may begin.

Elana Holzman

Thank you, Diego. Good morning and good afternoon everyone. Welcome to Teva's second quarter 2010 earnings conference call. We hope you had a chance to review our press release, which we issued earlier this morning. A copy of the press release is available on our website at www.tevapharm.com. Additionally, we are conducting a live web cast of this call that is also available on our website.

Today, we are joined by Shlomo Yanai, President and CEO; Eyal Desheh, Chief Financial Officer; Bill Marth, President and CEO of Teva North America Pharmaceutical; Moshe Manor, Group Vice President, Global Branded Products; and Dr. Gerard Van Odijk, President and CEO of Teva Europe and Dr. Ben-Zion Weiner, Teva's Chief R&D Officer.

Shlomo and Eyal will begin by providing an overview of our results. Please note that Shlomo will be referring in his prepared comments to non-GAAP gross margins, operating profit, net income and EPS. Eyal will provide additional detail on the items excluded from our non-GAAP results. We will then open the call for question-and-answer period.

Before we proceed to the call, I would like to remind everyone that the Safe Harbor language contained in today's press release also pertains to this conference call and web cast. Shlomo?

Shlomo Yanai

Thank you, Elana. Welcome everyone, and thank you for joining us today as we review Teva's results for the second quarter of 2010. This was an outstanding quarter for Teva. Indeed, it was our strongest quarter ever in (inaudible) of any growth.

Net sales reached $3.8 billion breaking all previous records in local currency clearance with record gross margins of 59%. Quarterly operating profit reached a record $1.2 billion, a 22% increase over the second quarter of 2009.

Net income in the quarter reached $981 million, 32% increase of the Q2 '09 and for the first time EPS cross the $1 mark to reach $1.08. Our free cash flow reached $700 million, an increase of 86% of the Q2 '09.

Teva's better than anticipated results in the second quarter were driven by superb performances across our many geographies and lines of business including especially strong sales in North America. We got a great quarter for Teva in North America with record breaking results. Record sales of generics and record number of new product launches. Total sales in North America reached $2.5 billion in Q2, up 17% over the second quarter of 2009. We have sales of $1.5 million in US generics, up 14% over the second quarter of 2009, and strong sales of our branded products.

It was also an exceptionally busy quarter with nine new launches representing a brand value of over $7.5 billion. This intensive pace has continued into the beginning of Q3 with our launch of (inaudible) ER, generic version of Fexo XO (ph). Thanks to the efforts of our outstanding global team, within 24 hours of launching over 25,000 pharmacies in the U.S. were supplied with the products, ready to dispense to the patients.

This was also an excellent quarter for our European business, which despite the challenging market conditions in this region, reached sales of $811 million at 10% of the Q2 '09 in local currency terms. Sales were up in all our major European markets and nearly all our other European market as well.

Gross was especially impressive in France, Italy and in the new World Cup winner, Spain, where sales grown by well over 20%. I believe that our performance in Europe this quarter demonstrates Teva's strong capabilities in managing a complex business environment.

The recent healthcare reforms in Europe, doing involve some pricing pressure in the short term, but there is an outstanding opportunity, although the longer term to increase generics penetration in these markets. Pricing pressure is something we are accustomed to. In the intensely competitive U.S. market for a long time and it is a phenomenon that Teva is adept at managing. For all these reasons, we remain very optimistic about the future of our European business.

Let's turn now to our international business, where sales reached $522 million, up 6% in local currency over Q2 '09. Our strong performance in markets including Latin America and Israel were offset by weaker results in Russia during this quarter. Our results in Russia, one of the fastest growing markets, where we continue to strengthen our market position, are simply a matter of the timing of tenders (ph) and the very large sales to governments, which were especially strong in the first quarter of this year as well as in the comparable second quarter of 2009.

Q2 was another outstanding quarter for our innovative business. Global in market sales of Copaxone, the world's leading therapy for the treatment of multiple sclerosis grew by 13% over the second quarter of 2009 to reach $770 million. Copaxone sales in the U.S. grew by 21% and according to IMS data; Copaxone maintained its leading market position in the U.S. with TRX (ph) of 40%.

We are continuously working to develop new ways of improving the experience of patients taking Copaxone. In April, the FDA indicated that the supplemental new drug application, SMDA (ph) for our lower injection volume of Copaxone had been accepted and the action date is January 1st, 2011.

In our (inaudible), which will examine a 40 milligram glatiramer acetate injection dosed three times weekly, initiated patient recruitment during the second quarter of 2010. We are confident that Copaxone sales leadership, although the last 10 years will continue and that is unsurpassed long-term efficacy, safety and tolerability established over 1 million years of patient experience will enable Copaxone to remain well-positioned even as new all (ph) therapies come to market.

Clearly, physicians and patients will have to carefully weigh the risk against the benefits for emerging all therapies, which are associated with serious safety concerns. Market research indicate that most physicians and patients will not readily adopt newer therapies until they reach benefit profiles are more slowly understood. Research also reveals reluctance by physicians to switch therapy, if a patient's disease is stable.

I would to take a moment to address the market reaction last Friday to the approval of the generic Lovenox and the apparent link that has been made to Copaxone. Our team has thoroughly reviewed the FDA's response to the citizen petition questioning the approval criteria for our generic, Lovenox. We believe that the agency's response actually supports our position and that in the case Copaxone and like some other complex molecules, there are no acceptable and reliable tests either in humans or in animals that can be relied upon except for complete clinical test, which reflect the clinical outcome in multiple sclerosis.

For this reason, we believe that any company seeking to introduce a similar version of Copaxone will need to conduct a long placebo control clinical trial with measured clinical end points in a large patient population to establish safety and efficacy.

And last but not least, all this has been reflected in our long-term (ph) strategic outlook, which we presented to you in January. As we told you then, our risk adjusted outlook assumes that Copaxone will peak midway through the planning period and gradually decline into the $2 billion range accounting for only 6% of Teva's sales by the end of 2015. Just to remind you, we expect $31 billion in sales of which $9 billion of sales will be branded sales by 2015.

I would now like to take a moment to highlight for you some of the major strategic achievements of the quarter. As part of our ongoing efforts to continuously improve the level of service for Teva's customers, we opened two major new state of the art facilities during the quarter.

In the Czech Republic, we opened a new all solid gold (ph) manufacturing plant, already approved by the FDA, where we will produce many of the large scale products for the U.S. market. The high quality and low cost production at this plant will enable us to further enhance our competitive position. And in Hungary, where our main manufacturing site for the EU is based, we opened a massive packaging plant, which will help us meet the growing needs of the many different markets we serve in Europe.

These last few months have been an exceptionally busy time for our European business as we prepare for the closing and eventual integration of Ratiopharm into the Teva family. As we get to know Ratiopharm even better, our excitement continues to grow about the combination of the two companies and the tremendous opportunities that lie ahead for our European business.

I am pleased to announce that we now expect the closing to take place earlier than we initially anticipated that we should close during the current quarter.

We are extremely pleased with the result of the first half of this year, which has yielded revenues of more than $7.4 billion and EPS of $1.99. Based on our performance during the first half of the year and our outlook for the third and fourth quarters, we now expect 2010 EPS in the range of $4.50 to $4.60 compared to the previous range of $4.40 to $4.60.

Thank you for your attention and now let us turn the call over to Eyal for a more detailed financial update. Eyal?

Eyal Desheh

Thank you, Shlomo, and good day to everyone. I hope you have had an opportunity to review the press release we issued earlier today. As you can see, we reported an outstanding second quarter with record sales in local currencies, as well as record gross profit, operating profit, net income and earnings per share or in a GAAP and non-GAAP basis, completing a very strong first half and heading to an excellent 2010.

We also reported cash flow from cash flow from operations of almost $1 billion and free cash flow of $700 million, both representing substantial gross compared to Q2 last year.

Before we delve into the numbers, I would like to touch in two technical topics. First, I would like to remind everyone that we are presenting GAAP and non-GAAP results. In our non-GAAP presentation, we have excluded the following items this quarter; amortization of purchase in tangible assets amounting to $130 million of which $122 million are included in cost of goods sold and the remaining $8 million is (inaudible) in marketing expenses; finance expenses, $123 million, which reflect $147 million in expenses resulting from hedging activities in connection with the acquisition of Ratiopharm; net of finance income of $24 million resulting from sales of security; construction (ph) cost of $11 million resulting mostly from closing and manufacturing facility in Ireland; $5 million purchased R&D in process; impairment of assets of $3 million and these expenses were offset by income of $23 million in connection with legal settlement and addition, the related tax benefit of $65 million.

You should note that the item excluded in arriving to our non-GAAP results for the second quarter of 2009 are not identical to those in the current quarter. Most notably, Q2 2009 included an inventory step up in connection with the Barr acquisition, and higher amortization of purchased intangible assets. Please review our press release and related tables for the reconciliation of our GAAP numbers and complete information.

As indicated in the past, we present non-GAAP figures to show you how we, the management team and our Board, look at our financial results. And second, foreign currency continues to play a significant role in our results.

In our second quarter, foreign currency differences had a negative impact of approximately $52 million on sales as compared to Q2 2009. The (inaudible) resulted primarily from the decline in the value of certain currencies relative to the U.S. dollar, primarily the Euro, the British pound and the Hungarian Forint, which was partially offset by a decline in the value of the U.S. dollar relative to other currencies, primarily the Canadian dollars, the Israel Shekel and the Russian Ruble.

Nonetheless, the impact of operating on operating profit continues to be negligible, this time on a positive side, was a positive contribution of $8 million. Several diverse geographical presences continue to provide us with a good natural hedge that mitigate much of the rich involving currency fluctuation and minimizes the impact on our bottom line.

Before I review the PNL in more detail, one more comment on the impact of foreign exchange had on our balance sheets, namely on our equity. The strength of the U.S. dollar at June 30 versus March 31st, primarily relative to the Euro, the Hungarian Forint, the Polish Zloty and the Czech Koruna resulted in a negative impact of approximately $1 billion compared to the first quarter of 2010 due to translation differences of long term assets mostly goodwill and other intangible assets as well as cash balance (ph) and hedge held in Europe.

However, in July, the weakening of the U.S. dollar had already offset part of this negative impact of the exchange rate as of June 30. Looking at our consolidated results for Q2, sales total $3.8 billion, an increase of 12% compared to Q2 last year. This vault (ph) is all organic as there was no acquisition during the past 12 months period.

North America, which grew 17%, delivered record generic product sales and strong profitability of the base (ph) business. Europe grew 4% in U.S. dollars and 10% in local currency terms. Some international markets grew 1% in U.S. dollars and 6% in local currencies, term and were influenced by the timing of Copaxone tenders (ph) in Russia.

Non-GAAP operating income reached $1.2 billion, up 22% compared to Q2 2009, benefiting from strong gross margin and tight expense report. Non-GAAP net income reached $981 million, up 32% compared to Q2 2009. Non-GAAP fully diluted earnings per share were $1.08, up 30% compared to Q2 2009.

Two housekeeping points related to earning per share calculation. The weighted average share cost for the fully diluted non-GAAP EPS was 921 million shares and to add back for the non-GAAP EPS calculation was $11 million in the quarter.

Now, let's discuss profit margin and operating expenses. Non-GAAP gross profit margin, which excludes amortization of purchased intangible assets, was 59% in the reported quarter compared to 58.5% in the second quarter of last year. Gross margin continued to benefit from contributions from new and recently launched generic products in the U.S., improved gross margin of the U.S. generic base business and the contribution to sales of our innovative and branded franchises.

Non-GAAP operating margin reached 31.6%, up 2.7 percentage points from 28.9% in Q2 2009. The increase resulted primarily from the termination of payment we made to Sanofi-Aventis over the past two years of 21% of Copaxone in market sales in the U.S. and Canada, which were recorded on the sales and marketing.

Strong gross margin and lower G&A as percentage of sales also contributed to the improvement in our operating margin, and R&D expenses reached $217 million or 5.7% of sales and were up 28% compared to Q2 2009. Gross R&D before reinvestment from third parties for certain R&D expenses were $227 million or 6% of sales, up 8% compared to gross R&D in Q2 2009.

The increase in R&D expenses relates mostly to our innovative and branded business, most notable Women Health products, the new low volume from election of Copaxone for which (inaudible) was made with the U.S. FDA and our (inaudible). As we guided earlier in the year, for the full year, we expect net R&D expenses to be between 6 to 6.5% of net sales.

Sales and marketing expenses, excluding amortization of purchased intangible assets totaled $636 million in the second quarter or 16.7% of sales compared to 18.9% of sales in Q2 2009. As already mentioned, the decline resulted primarily from the termination of payment through Sanofi-Aventis, which were recorded in sales and marketing expenses partially offset by higher royalty payments in connection with new and recently launched generic products in the U.S. markets.

Total G&A expenses this quarter were $189 million or 5% of sales compared with 5.8% of sales in Q2 last year. The synergies (ph) from the Barr acquisition continued to contribute to the decline in G&A expenses and too many other expense line items in our PNO.

We recorded $25 million of net financial expenses on a non-GAAP basis in Q2 compared to $61 million of non-GAAP financial expenses in the comparable quarter of 2009. The lower financial expense resulted primarily from lower level of debt of average debt through most of the quarter compacted to the second quarter of 2009 as well as lower interest rate and higher gains from hedging activity unrelated to Ratiopharm.

Excluded from our non-GAAP financial expenses in the quarter are $147 million incurred in connection with the hedging of the Ratiopharm acquisition and again, of $24 million from the sales of securities. Following the agreement to acquire Ratiopharm and as we indicated last quarter, we created a hedging program designed to protect the dollar value of the acquisition. After accounting for $147 million in hedging dispenses (ph), the net saving from the acquisition price is approximately $270 million in U.S. dollar terms compared to the price on the day we announced the acquisition.

In the third quarter, (inaudible) this hedging transaction, we reversed approximately $40 million of this cost, which are requested to be recorded as income in Q3, but consistent with our current presentation will again be excluded from our non-GAAP result. The tax expense provided for the second quarter was $183 million on pre-tax non-GAAP income of $1,176,000,000.

Our current estimate of non-GAAP annual tax rate for 2010 is 15% compared to 16% for all of 2009. The estimated tax rate for 2010 GAAP results is 12%.

Now, let's have a look at our cash flow. Cash generated from operation this quarter totaled $954 million, up 45% compared to Q2 2009. Our free cash flow, excluding gross capital expenditure of $136 million and cash dividend of $164 million partially offset by proceeds from sale of certain assets of $46 million amounted to $700 million even or 86% higher than in Q2 2009. The improved cash flow was driven by strong collection and slight increase in working capital items this quarter.

As you all know, in anticipation of the closing of the Ratiopharm acquisition were issued $2.5 billion principal amount of senior notes and site (ph) pre-credit agreements with banks for a total commitment of $1.5 billion. On June 30, cash and marketable security total $5.2 of approximately $2.2 billion for March 31st, 2010. Our total outstanding loans, bonds and convertible debentures stood at $7 billion, up from 5.4 billion as of the end of March.

Our cash position as of the end of Q2 reflects our used of some of the cash we raised to pay down approximately $800 million of the more expensive Barr bank debt. Our convertible debenture was reduced by $70 million this quarter and we intend to pay down the balance of the Barr debt approximately $700 million by the end of this year.

As a result, our financial leverage as of June 30, 2010 was 27%, similar to our leverage in Q2 but up for 22% in March 31st.

DSO, Days sales outstanding, amounted to 50 days this quarter compared to 53 days in Q1. We calculated DSO after netting out from the receivables our sales reserves and allowances. Inventory days stood at 172 days down from 183 days into previous quarter or down from 188 days in Q2 2009.

Net capital expenditures reached $90 million this quarter compared to $164 million in Q1 2010. This quarter net CapEx includes proceeds of $46 million from sales of (inaudible).

And last dividends, yesterday Teva's Board approved a quarterly dividend amounting to approximately $170 million. On a per share basis our dividend, which is declared in Israeli Shekel is 0.7 Shekels per share. Based on yesterday rate of exchange of the Shekel to the U.S. dollar, this translates into approximately $18.01 per share.

Thank you all for your time and attention today, now we'll be glad to take your questions.

Question-and-Answer Session

Operator

Thank you. I will now conduct the question and answer session. (Operator instructions) Our first question comes from Randall Stanicky with Goldman Sachs. Please state your question.

Randall Stanicky – Goldman Sachs

Great. Thanks for the questions. Just for (inaudible), it's verification. The updated guidance had remained, has the standalone and did not yet reflect Ratiopharm is that correct?

Eyal Desheh

Yes, absolutely. As the exact date of the closing is still not known, we did not account for Ratiopharm results in this guidance and this is apples to apples with what you know on 2010, in general. We, of course, will provide an update, but will take it a little while to study the exact data of the company as right now our plans are based on due diligence information and as always take a little bit of time. We do expect this to have a positive impact on sales, of course, as to our earnings per share will probably be a couple or three cents below but not more than that in the first period and of course, it will have a contribution in 2011 as we mentioned when we announced the deal.

Randall Stanicky – Goldman Sachs

Okay, great. And then for Gerard, with respect to what you reported the 10% constant currency growth in Europe, can you just give us a sense of how much of the known pricing cuts reflected in that second quarter reported number at this point?

Gerard Van Odijk

Thank you, Randall, for the question. I think it's a complex question you're asking there because it's almost different through each market to answer. But I think I should start with saying, repeating what Shlomo said, if you take it across the board, Shlomo has been able to demonstrate that our setup in Europe makes us less vulnerable to some of the price dynamics in Europe. We know how to handle the complexity and detail and just that are coming from the clear price pressure that we see in Europe.

I also think that we've learned in tougher pricing environment like the U.S. to handle this. If you look at that, there is – people who stay with us like the price pressure, but has been with us for a long time, it will stay with us. we've seen prices going down in markets, but it's been overcompensated by volume growth and very clear that it has to do with our portfolio, which is quite well spread between OTC, with hospitals, with retail, with many other products and also our geographies. We are not overweighed in one place or the other. We have a very nice well-spread portfolio and products and geography.

On top of that, of course, we have launches that give us the tools to respond to all of these challenges. On top of that, we believe that the environment is helping us. There's volume growth in many, many places, which is very strong and that's why I believe that it's for that that we can explain that our growth in this quarter was as good as it was. I'm sure that it will require every quarter, a lot of hard work from us and very specific (inaudible) may answer (ph) to the different challenges and opportunities we see in the different geographies in Europe and it's very clear that we're up to it.

I'm happy to give you a few examples, but perhaps we can talk about that later in line with other questions.

Randall Stanicky – Goldman Sachs

Are there a couple main regions or major countries that you can highlight or points to that pricing pressure have been fully reflected of the known pricing (inaudible) at this point?

Gerard Van Odijk

Well, in some places, thought it and in some places its most thought. I'll take the much (inaudible) open about example in Spain, for instance in retail where we all know about the announced 35% price decrease on the gross prices but also with limitation on discounts in the trade as part of that whole package.

Randall Stanicky – Goldman Sachs

Yes.

Gerard Van Odijk

As Shlomo reported, we had – or I think (inaudible) was we had excellent growth and we've been growing nearly 20% in our retail in Spain in a period of that, all of these matches were kicking in Spain, so it's been absorbed and despite that we have been able to grow our business very strongly in a place like Spain. And in other places, like in Italy, it will take a bit more time, it's just been announced the 12.5% again on gross price. In Germany, you see that some of the (inaudible) vendors are currently kicking in and where some companies have been gaining senders (ph) last year and they see now some of the results in that we know that we've once intended in this first half of this year, which will be kicking-in in terms of market share and volume growth next (inaudible) and the rest of this year or next year and the pricing pack will be related to that.

It's a very diverse picture across Europe. If I talk about Germany, I talk about the Panda (ph) business, but as you know large chunk of the German market is not expose to Panda's (ph), so it's a segment in Germany that's under price pressure or the segments that are feeling the pressure of price, but as I said that's a sort of price pressure that we see coming in every year.

Randall Stanicky – Goldman Sachs

And France is reflective?

Gerard Van Odijk

And France, in France, we know that the government is going after some extra savings and it haven't yet specifically announced although that the indication is that they're going to go for a few specific therapeutic areas and that hasn't yet kicked in and we expect the specific price decrease on some specific therapeutic areas like they did last year.

Randall Stanicky – Goldman Sachs

Okay, great. Thanks very much for the color.

Operator

Our next question comes from Rich Silver with Barclays Capital. Please state your question.

Richard Silver – Barclays Capital

In respiratory business in the quarter seems stronger than we would have expected can you provide a little bit more detail on what's happening both in the U.S. and overseas and what we can expect going forward? I have a second question, thanks.

Shlomo Yanai

Okay. So, Bill will you take the U.S. piece and then Moshe will follow by the international (ph) or countries with the international part?

Bill Marth

Sure. Good morning, Rich and thanks for the question. With respect to respiratory, obviously, as you've seen ProAir has been holding around 50%, so that's been very well. And then we've got some seasonally adjusted advantage because there's this particularly good season for us, and really the strength of QVAR has been really exceptional. It's almost 20% of that category now and Teva's done very, very well and continues to grow.

So, I would say the ProAir really holds steady and moves with the market, with the season, and QVAR is really showing it, just great strength for us.

Richard Silver – Barclays Capital

So, with the seasonal strength that you cited, does that mean that in the coming quarter, we should not expect the same level of sales that we saw in this quarter?

Bill Marth

Well, it's hard to say what's going to happen in the Q3. It all depends on the weather and the season. So, right now, the quarter seems to be pretty good, but we'll see how it ends up.

Richard Silver – Barclays Capital

Okay.

Shlomo Yanai

Wait, Rich, for Teva, there is only one season in a year.

Richard Silver – Barclays Capital

Okay. And then the gross margins that maybe Eyal had comment, I didn't hear that range in 59 to 60% is that still the case for the full year guidance?

Eyal Desheh

Yes, I believe so, Rich. I think that has 59% (inaudible) refer to this quarter or earned this quarter, the second half of the year was then the (inaudible) coming in. So you could see some improvement there and I think what we have guided at the beginning of the year, so it's pretty valid.

Richard Silver – Barclays Capital

Okay and then lastly, I know you haven't provided 2011 guidance yet, but specific to (Inaudible) are you assuming additional competition in January?

Shlomo Yanai

Bill? I think it's too early to answer this question, unless Billy would like to add something here.

Bill Marth

Well, I would just add that it's too early to answer that question. So, I concur.

Richard Silver – Barclays Capital

Okay.

Shlomo Yanai

That's way to each, we will get there.

Operator

Our next question comes from Chris Schott with JP Morgan Chase & Company. Please state your question.

Chris Schott – JP Morgan Chase & Company

Great. Thanks. The first question was just the follow-up on Europe, I think you average about 5% constant currency growth for the first half of this year, when we consider the mix of further price cuts as well as potential new (inaudible) and volume growth, is that 5% type of growth rate we've seen so far this year, a decent proxy of what you're anticipating for the second half? I mean (inaudible) fall off after that.

Shlomo Yanai

Eyal? (ph)

Eyal Desheh

I think the second half last year, was a very good second half and although we are anticipating continued price pressure as we spoke about earlier. I would assume that we would be able to sustain the same sort of growth range as we have been doing so far.

Chris Schott – JP Morgan Chase & Company

Great. And then (inaudible) guidance, can you talk a little bit about the earnings progression as we think about 3Q and 4Q given the generic effects or launch this quarter and number of potential opportunities, we think about 4Q. Should we think about 3Q and 4Q as roughly equal quarters or are you anticipating one that's going to be meaningfully above the other? Thanks.

Shlomo Yanai

Yes. You're living me very little choice but to return to our old type of describing a market, as a market with many moving parts and that is true also this second half. I mean generally we could see the rest of the earning per share for the second half exclude more or less even between the quarters, but it could definitely, we could definitely see a couple of cents moving from one quarter to another depending on timing of launches, demand in the market, how we've allocated over the period and of course, this does not include the Ratiopharm impact.

So, I would calculate this more or less even perhaps minus two cents that could move.

Operator

Thank you. Our next question comes from Ken Cacciatore with Cowen & Co. Please state your question.

Ken Cacciatore – Cowen & Co.

Great. Thanks. I was wondering if you all could give us a little bit a sense of what the (inaudible) did since petition taught you about your own Lovenox filings. Is there anything that you saw and how you can go back and address or are you in the direction with the agency. And as well, Shlomo, you're commentary about some of the teachings in the Lovenox citizens petition, this are the Copaxone. How do you think the FDA is going to address some of these potential deficiencies? Do you think that they'll have to solicit kind of expert commentary or open up to the public to help address maybe the mechanisms and assays (ph) that should be utilized on Copaxone? Thank you.

Shlomo Yanai

Okay. So, Bill, you take this one and then Ben, you will follow to complete the answer to this question.

Bill Marth

Good morning, Ken and thanks for the question. With respect to our Lovenox file, we are continuing to dialogue with the agency. I would say to you that we feel that we're on track. We're progressing ahead. We did file slightly later, about a month later than Momenta on the response the immunogenicity, which is very likely why we haven't received our notification yet.

But as we review the five criteria, we find that our product falls clearly within the range that we believe is approvable. Now, of course, we have to let the FDA – they're going to have to give it their opinion as well. But the fact of the matter is as we read through it, we think that we did all the criteria very, very well and it's just the timing issue.

Shlomo Yanai

Ben-Zion, would you like to add on?

Ben-Zion Weiner

Yes. In relevance to the correlation between Lovenox and Copaxone, I don't think that there is a direct correlation between approval of Lovenox and future generic approval of Copaxone. The FDA had issued five criteria by which Lovenox has to follow and then get approval, three of those have to do with the external (ph) material, physiochemical aspects for the fragment, et cetera. I won't go into details unless you want me and the two criteria that have to do with biological access and test and human exposure and I think Copaxone is very different from Lovenox in the first part, in the three criteria that have to do with the actual product, and primarily with the two biological ones.

The first three, Lovenox is the parent compound is obviously heparin, known chemical, a known product for 90 years, structure is known, activity is known and Copaxone is obviously a very different molecule based on random polymerization of four (ph) amino acid, structure is not very clear. There is no specific epitope through which the activity can be explained, and I won't go into details about the series of polypeptides and the number of repeating units in the Lovenox.

What is very important to note here is that Lovenox, the essays through which FDA approved Lovenox is based on very simple straightforward acceptable test that everybody can do, which are directly related to the target organ, which is the blood. Copaxone target organ is the brain and there is no direct correlation between the mechanism of action of Copaxone, which has to do with influencing immune cells and the target activity in the brain. So, in my mind and other people mind, there is no direct substitution to a proper clinical trial conducted on MS patients with clinical end points.

In my mind, there is no good way to demonstrate safety and efficacy unless such as clinical trial is being performed. No PK, no PD and no biological essays can substitute this notion.

Ken Cacciatore – Cowen & Co.

Great. Thanks, very helpful. And Bill, just to finalize, can you talk about the Irvine facility, any update there?

Bill Marth

Yes. The Irvine facility, we continue to work with the agency. We have released 12 products to date in cooperation with the FDA, and we are continuing to work with them on a daily basis to bring that facility up. I would remind that any of the big launches that people are concerned about Onaxiperine (ph) is not tied to the Irvine facility or Gemcitabine for that matter is also a product that can be manufactured elsewhere.

Ken Cacciatore – Cowen & Co.

Great. Thank you.

Bill Marth

We have our final approval. Thanks.

Operator

Our next question comes from Ronny Gal with Sanford Bernstein. Please state your question.

Ronny Gal – Sanford C. Bernstein and Co.

Good morning and thank you for taking my question. (Inaudible) one around the filing of the Lovenox (ph), do you happen to have any update on whether the product will be entitled for a three (inaudible) and second, a little bit of – if you can how you think about the risk in – that you currently have Plutonic (ph) and the chances of exclusitivity on (inaudible).

Shlomo Yanai

Bill, can you take the second one and then you will take, Moshe, the first one.

Moshe Manor

You're welcome.

Bill Marth

Moshe, you want to go first?

Moshe Manor

Yes. As you probably know, we have submitted the file or the 0.5 ml (ph) and the file were accepted by the FDA and with the action date as when both mentioned in the January 1st, 2011. Of course, I think it's too early to comment that you ask about exclusivity, well, definitely we have a good data there that show that the 0.5 ml is associated with less local size reaction and same local pain and that's something that we are going to discuss the FDA and with relation to the potential ore-exclusivity to the low volume product.

Ronny Gal – Sanford C. Bernstein and Co.

But you would not know the answer to that until January 1st or would you know the answer before that?

Moshe Manor

I don't think that we know the answer. I don't believe that we know the answer before January 1st for this question.

Shlomo Yanai

Unless the FDA will give us the answer earlier. Bill, can you answer the second on the Clopanics (ph).

Bill Marth

Yes. Let's talk about the last two questions, Ronny. The Plutonic and the Denapazil (ph), on Plutonic's, let's just – we go back to that and say, I think it's a little early to talk about damages on Plutonic because we still believe we have a very long way to go here. Although, obviously, we don't agree with the judge and at the appropriate time, we will appeal that decision. We still have two defenses that remain alive out there, the patent (ph) meds used in the (inaudible) hands.

So, we will still pursue those with full vigor and we'll be looking for discovery in those particular areas. So, I think we're a long way away from that on Plutonics (ph). On the Denapazil (ph), I can recount to you where we're at, as you know that we have actually two files. But our first file, we have a final approval on that file, we believe, we are first to follow on the compound patent. We believe we are entitled to exclusivity, we maintain that position. Of course, Ranbaxy challenges that position but we beg differ to that view and so we're just proceeding.

Ronny Gal – Sanford C. Bernstein and Co.

(Inaudible), I mean once the station needs to take place in the FDA end, is on the court, what does that stand, what is the timeline to approve in this, to resolve without a question?

Bill Marth

Well, we don't what's going to happen at this point in time. Obviously, we think the decision will be in the hands of the FDA. There's no issue with the court so.

Operator

Thank you. Our next question comes from David Amsilumer (ph) with Hyper Jafford (ph). Please state your question.

David Amsilumer – Hyper Jafford

Thanks. Just a couple. First on Copaxone, do you think you're getting to a point in the U.S. at least, where you won't be able to be as aggressive in raising prices and just talk about what you think the long-term outlook on price increases for Copaxone and how you're thinking about the pricing (ph) in the U.S.

Shlomo Yanai

Bill, would you like to take this one?

Bill Marth

Yes. Yes. Thanks, for the question, David. You bring up an excellent Copaxone and the pricing. We did take another price increase this quarter and as we move forward, we begin to wonder about where this price increases will lead us to. But for frankly, you've see the competition raised their price as well, so price in this particular area seems to go up. I would tend to agree with you that I would not be as aggressive in the future on my pricing, but we'll have to see.

My concern is always been, Teva is generally speaking not a price leader, we're a price follower and what I can't tolerate is the situation where what I believe is the standard of care in this particular therapy and the leading product in the U.S. and the global market to be disadvantage on price. So, we'll continue to watch that as we move forward and just follow the market.

David Amsilumer – Hyper Jafford

Okay. And then just the second question about competition from the oral and specifically, Gilenia, I mean what's your market research telling you regarding the willingness of doctors to potentially use Gilenia in earlier stage patients or do you expect that Gilenia, largely, at least initially we'll see usage and treatment failures and potentially switches from TYSABRI. I guess talking about what your research has been telling you though.

Ben-Zion Weiner

Well, based on our research and discussion, extensively discussion actually with the premier (ph) leader, we believe the oral and specifically, Gilenia will enjoy flow will still uptake and the reason, I believe, is the first of all, most of the patient in Copaxone are stable, they are doing well and we don't see (inaudible) or twitching phase and that they are doing well to a product that is really relative new with unknown long-term safety concern.

And actually if you talk about safety, we have to look at the own safety as the issues that already were published and more that I think, we have to pay attention to the long-term, potential long-term safety and based on the experience we all had in the market and physicians and patients with TYSABRI, we know there is a question of issues of safety and the emergence of safety issues on the long-term. So, therefore, I believe that physicians will and definitely patient will follow, will prescribe the oral mainly as a third line therapy and in some cases in the second line therapy after patient have failed on one or two therapies.

I think it's fair to say that the oral might have the chance or the opportunity to extend the market as those patients that really (inaudible), early (inaudible) no treatment or (inaudible) neither for their patient that's an opportunity that all can offer to the market, that will not – on the extent on the existing (inaudible) and definitely not the extent of Copaxone.

So, now, (inaudible), if you look at the oral and we look at Copaxone, Copaxone can deliver. We are confident that Copaxone will maintain its leadership and actually we will grow Copaxone (inaudible) in 2011.

David Amsilumer – Hyper Jafford

Yes, that's helpful. Thank you.

Operator

Our next question comes from Gilbert Gregg with Bank of America. Please state your question.

Gregg Gilbert – Bank of America

Thanks. Good morning, and I think this one is for Bill on the 0.5 ml filing, regardless of whether you will get exclusitivity or not, do you expect the product to have its own orange book entry and separately, is there any intellectual property pending that is specific to that formulation?

Bill Marth

Gregg, good morning. Should I call you Gregg or Gilbert?

Gregg Gilbert – Bank of America

Your call.

Bill Marth

I was kidding. But in any case, it's impossible for us to say at this point in time really whether we'll get the exclusitivity on the SNGA (ph) and Molevon (ph). I would like to believe that we should get that, but the fact of the matter is right now, we will have to wait to see what the FDA's opinion is on this.

Gregg Gilbert – Bank of America

Okay. So, whether or not it has its own orange book listing and exclusivity archive to each other, you don't know based on the type of application whether you would get an orange listing that is separate or not? To make sure I'm clear.

Bill Marth

Yes, it all depends on the label. So, at this point in time, we're just not sure.

Gregg Gilbert – Bank of America

Okay, fair enough. And then the other sort of bigger picture, North America question, I have for you, Bill, is your latest take on the implementation of AMP and the implications for your business and the industry? Last time we check in with you, I think it was still unclear to you what the final deadlines would be and what the effects might be.

Bill Marth

Well, we know that the effect actually is – the bill was signed in March 23rd and then it actually goes into effect at the first of next year and it will go back and reference pricing from the fourth quarter of 2010, that's our estimates right now. The actual, what the effective AMP will be in the U.S. is really a very interesting question. We just don't have a good sense for that.

One has to speculate that if you're talking about AMP being a weighted average of pricing that's sold using a particular formulation with some exclusions and exclusion (ph), essentially those largest purchasers that are not mail order, being the large chains in the U.S. are likely to be those individuals that drive the AMP. So, those largest chains prices will be largely what make up the weighted average AMP because if you aggregate maybe CBS and a Walgreens, and a Wal-Mart and a Rite Aid together, you got to have what's largely the retail market in the U.S.

So, if you think about that you have to wonder about the new dynamics and why does this – why do these large chains want to drive down price, where they did prior. Prior, they always wanted to get advantage over the other chain. Now, when if you drive down price at one particular location, whether it be, whatever city you're located, whichever chain drive down price, there is effect against everyone, so you don't get to capture that benefit. So, it's really a perverse incentive (ph) and this was something when this whole theory of AMP was talked about in Washington, we fought against it because we didn't think it was proper, the proper incentive, but we'll see what happens.

It's very much an open question and anyone's guess is this probably valid at this point.

Gregg Gilbert – Bank of America

Thanks, Bill. And then lastly on (inaudible), have there been any color to offer on regulatory or legal issues with your G-CSF filing and are you doing anything with EPO in the U.S. Thanks.

Bill Marth

Our file so far on the G-CSF is progressing. I don't think we will have anything to add on EPO just yet, but we may have something to talk about a little later, but nothing to talk about right now, and we are proceeding down the path as a VLA at this point in time and not with this ABLA route. Again, why would you take the ABLA route, which is very uncertain as to how to go down that path now and if you look at some of the legal characteristics of how the (inaudible) work, why would I reveal my whole process to the innovators so that they can decide what to sue me on. It just makes a whole lot of sense for us. It's just much simpler for us to go down the path of VLA.

Gregg Gilbert – Bank of America

Thanks a lot.

Operator

Our next question comes from David Buck with Buckingham Research. Please state your question.

David Buck – Buckingham Research Group

Yes. Thanks. Just a couple of quick ones, first, Eyal, can you give a sense of Ratiopharm, how you think they're reacting in terms of performance to the European price cut environment and what the run rate of sales would be from Ratiopharm in 2010.

Secondly, for Moshe, can you talk a little bit about, you mentioned clinical trials as your view that you think it's a gold standard for a (inaudible) or equivalent form of Copaxone, how do you expect at this point to get your message across to the FDA. Obviously, the (inaudible) route has been tried and what sort of the next step we should be exciting and dialogue with the agency and finally, can you just talk about what the statuses of Laquinimod and what the filing target (inaudible) into that next.

Eyal Desheh

Regarding Ratiopharm, I think this is way too early (inaudible) provided educated answer. We will open the boxes once we complete the acquisition. We'll learn and we'll come back to you guys, well-informed and educated. I don't anticipate any material changes, it seems that the business has been running well, but numbers will be provided on a timely basis. It's a private company as you know much less information then we you acquire a public traded company still viewed and (inaudible) foreclosing as the potential competitor.

So, the level of detailed information (ph) provided to us was natural limited and we will study and report, but as I said, we don't anticipate surprises. I think they've been dealing – from all we know they've been dealing well with the environment and Germany and the rest of Europe for our (inaudible).

Moshe Manor

David, as far as Copaxone based on – wants to be (inaudible) and they're now understanding the Copaxone and the (inaudible), we believe that we will continue our interaction and we plan to do to reach the FDA and actually demonstrate to them and convince, we believe that we convinced the FDA that they in age of Copaxone, it's unavoidable that any generic competitor will need to embark on clinical study and even on clear clinical activities as well.

As far as Laquinimod, as we reported we have completed the (inaudible) quarterly quote (ph) med and the first study, we've seen the result of the first study in the first quarter of 2010, 2011 (ph) and followed by the result of the second study by the mid of 2011and everything goes as we plan. We immediately plan to submit the file as we have fast track anything in the U.S. We are planning to launch the product by May of 2010 (inaudible).

David Buck – Buckingham Research Group

Just one follow-up, would you anticipate any type of public forms such as an advisory committee on the Copaxone, on the issues that you raised?

Moshe Manor

That could be one of the scenarios where that can take place. I think that the dialogue with the FDA is ongoing and we believe that based on the recent or publication that on the Copaxone and the mode of fraction (ph), this is the case that the FDA will require clinical challenge from any colon Copaxone.

David Buck – Buckingham Research Group

Thank you.

Operator

Our next question comes from John Boris with Citi. Please state your question.

John Boris – Citigroup

Thanks for taking the questions. First couple for Eyal and then I have a couple of follow-ups for Bill. First off on the cost to goods, can you just help us understand what the intent of foreign exchange was on COGS within the quarter, then you do provide us with your ATI sales, can you provide us with your global generic and branded sales within the quarter?

Eyal Desheh

I'm sorry, first of all, on COGS, it was a major (inaudible). In fact, they're going to get improvement in cost that we've seen mostly a matter of called, product mix that we've seen the – what was the second question?

John Boris – Citigroup

You gave us API sales, can you –

Eyal Desheh

Yes.

John Boris – Citigroup

Can you possibly provide percent –

Eyal Desheh

Yes.

John Boris – Citigroup

Generic and percent branded sales.

Eyal Desheh

Yes. The breakout I don't have under my hand. Regarding, API sales, we had a very strong and good quarter on sales of API activity with growth of (inaudible) 23% year-over-year and as you know we stop publishing this individually as a business, say (ph) unity. But around $163 million for the quarter and 23% growth.

John Boris – Citigroup

For Bill, can you just comment on whether you have large quantities available on Lovenox and your capability of being able to supply the market, some (inaudible) checks with – and indicate the mental (ph) might be, somewhat capacity constraint and then second question, just has to do with the office of generic drugs. It seems as though between some patch formulation getting approve, some high profile has sustained the least preparations and then Lovenox approval – are we seeing a pickup at OGD or this just an anomaly? Thanks.

Bill Marth

Thanks for the question, John. As far as launch quantities with respect to an Oxyperone (ph) the answer is yes, we're in good shape. So, we just will need the approval and of course, we comment on that earlier.

The second question, your second question was about the OGD and its activity now and the leadership there. I think on that particular question, I do see them getting bolder and making some very interesting calls and I think that this is really a step in the right direction. There's interim leadership right now in the department and we take our hats off to them for proving an Oxyperone (ph) and in proving that they can stand some tough (inaudible). So, we think that's a really a positive thing at this point in time.

Operator

Thank you. Our next question comes from Mark Goodman with UBS. Please state your question.

Mark Goodman – UBS

Yes. First, you keep talking about the U.S. base business being strong. Can you just give us an indication of is this stronger than last quarter is, last quarter stronger than fourth quarter? Is this getting better or is this just continues to be stable and so you can put some color on that and then also Canada. Obviously, we've seen what Canada is going to do to pricing, give us a flavor for how that's going to impact you're business, the business you're about to get from Ratiopharm.

Should we be assuming that the Canadian sales are going to be down in 2011 versus 2010?

Shlomo Yanai

Bill?

Bill Marth

Yes, Mark. A couple of points here. The base is strong (ph). We've done a lot of things to improve our base over the last couple of years, whether it's pruning, where we take out some of the less profitable products and sell more of the profitable products. We've seen more impacts around pricing increases, just is lots and lots of different things. Some of the products that have launched, they launched it a little better with pricing than it had historically. Some of these can be retraced to the quality concerns and lots of proactive things going on our base business.

So, I think by and large our base business has been strong for the last few quarters and continues to be strong, and really there's not much more to say about it the next. Whether you say there's – is that changing from quarter to quarter. Remember, the way we track our base business, its products that have been in the market for two years, so every quarter an old launched product becomes a base product and of course, that changes your numbers somewhat, but it's been a very strong business.

As far as Canada goes, the Canadian business, we continue to believe it's going to be strong out. Obviously, the effects in the various provinces of the changed (inaudible) with respect to Ontario, that's going to have an effect. The idea though, the big change is what happens with the chain or the pharmacy itself. In that particular system where they're lowering the reference price, it's not indifferent by the way to what's happening in other markets. Whether you see the U.S. change in AMP or you see the change in Spain, it's really the government trying to take something out of the channel and what they're doing is lowering price and then you're limiting your backend to the pharmacy themselves.

So, net for us is not as huge of a change as one might expect. We certainly believe we'll get some pressure from the chain, in order to give more on the backend. But at this point in time, we don't see a huge change. It may actually be a net positive for the business as it becomes more difficult for some of the smaller companies to manage.

Mark Goodman – UBS

So, we should be assuming Canadian sales in 2011 will be up from '10? I mean obviously –

Bill Marth

Obviously, with the addition of the Ratio –

Mark Goodman – UBS

Excluding the Ratio pharmacies –

Bill Marth

And again, I can't really comment on that until I actually get my hands on the Ratio business and I'm able to look at –

Mark Goodman – UBS

But just on your own base business in Canada, are you expected to be up next year?

Bill Marth

Yes. Our business has been growing and we'll continue to grow.

Mark Goodman – UBS

Okay.

Shlomo Yanai

Let me take this opportunity to follow on because I see that the pricing pressure is the time for comment dominator question all over the globe. I think that the results in Europe, 10% growth is actually the best answer to prove the statement that Teva knows how to operate in a price-pressure environment and this is not just a statement for stating the obvious from our point of view, just to say that we know how to leverage our market leadership, how to leverage our scale and how to leverage our largest ever portfolio and our different lines of business, and if you add to that the deep understanding and the know how in different models of businesses, countries and healthcare systems, that's actually give you in a nutshell the answer how we are managing to continue a (inaudible) journey in a pressurized environment, exactly as we did it for many years in the United States.

So, we believe that this is one of our unique advantages that make us different from part of our peers that we know how to operate and how to make money and even how, of course, to grow the business, handle different business or market environment.

Operator

Thank you. Your next question comes from Corey Davis with Jefferies & Company. Please state your question.

Corey Davis – Jefferies & Co.

Let me just follow on then for just last comment you just made. So, if you're continuing to grow in the face of pricing pressure, I guess the only way to do that would be to gain share and so, (a) do you agree that and (b) since you're the first of the big public companies to report, when the others report are we going to see that perhaps less robust results. I'm not asking you to comment specifically on their results, but if you're gaining share in volume terms, you have to be gaining it from other players. So, is that the right way to think of how you're being so successful when you're up in the face of such pricing pressure?

Shlomo Yanai

First of all, it's a general statement. I would agree with you that market leadership is about getting the market share and we have said it many times in the past that our strategy is to gain more market share. There is only one caveat to your way of reposing the question, I do believe that in certain markets, definitely Europe is a good geography for that we can also see larger pride or actually see more market or potential market, as the European markets, at least some of them, the level of generic penetration is relatively low compared to a market like U.S. or less quality (ph) generic developed countries in Europe.

So, there is still more room to grow generics and therefore, we are so optimist on the business in Europe, not only by taking the market share for our competitors, but also by growing the overall market for generics in Europe and some other countries in the world as well.

Corey Davis – Jefferies & Co.

Okay, great. And for Eyal, did I hear you say that the goal is to take your tax rate down to 12% in 2012?

Eyal Desheh

No, no. We didn't. I don't recall saying anything of that kind. I said that –

Corey Davis – Jefferies & Co.

Okay. I'm going to finish (inaudible) –

Eyal Desheh

In my opening comments, I said that our GAAP tax rate for this year is estimated at 12%, at 15% in a non-GAAP basis and we don't see that just declining in 24 (ph).

Corey Davis – Jefferies & Co.

Okay.

Eyal Desheh

Yes.

Corey Davis – Jefferies & Co.

For Bill, I think I got the message, but I (inaudible) fairly extreme optimism on your own generic Lovenox and can you elaborate even more on maybe that you're interactions with the FDA discussion, is it really nothing more than checking all the boxes that they put out in and their response to the CT (ph) and just finishing up their review of your immunogenicity data that you mentioned?

Bill Marth

Yes, Corey. It's hard for me to say much more. We have dialogue with the agency. We believe – first of all, we've looked at the citizen's petition and we believe that we meet all the criteria on the citizen's petition. Our dialogue with the agency says that our review is going nicely and we're just waiting for a couple – we're just waiting for an answer. So, we feel that we're in a good position, but again it's up to the FDA to decide, not me.

Corey Davis – Jefferies & Co.

Last one, Eyal, can you just run down the list of countries in Europe or (inaudible) when the royalty rates flip from the rough 50% on Copaxone down to the 6% as we go through 2012.

Eyal Desheh

Well, we could take your thought offline and I don't think that we – if you want to be precise, you should have the list and (inaudible). Let's take this offline.

Corey Davis – Jefferies & Co.

Fair enough, thanks.

Shlomo Yanai

Just one more.

Eyal Desheh

Last one.

Shlomo Yanai

Just before the next question, just one more follow-on on the Copaxone as it become the major subject in this conference call. To add-on comments, to add to what we all of the answer in this respect, one is just to remind you that about third of our Copaxone sales is in a non-U.S. market, which the whole discussion that we are involving is less relevant for this 1 billion growing business.

The second comment is regarding the oral therapies as kind of a food for thought, I would like to take the subway (ph) case study for you and you can look in the retrospective, which it reminds a little bit the next oral therapies and you see the chronic market share and the currency (ph) developing the last six years, it can give you the time of a good hands on where we see this all is going to be into coming in all the coming years.

Operator

Thank you. Our final question comes from Milan Parati (ph) with Credit Agricole. Please state your question.

David Maris – Credit Agricole

Hi. It's David Maris. On Copaxone, can you just update us again on the timing of the trial and the decision and walk us through your timing assumptions. You mentioned it earlier.

Shlomo Yanai

(Inaudible)?

Eyal Desheh

The GALA (ph). Are you referring to GALA (ph) sign?

Shlomo Yanai

No, no.

David Maris – Credit Agricole

The legal trial.

Eyal Desheh

The legal (inaudible).

Bill Marth

I'll take that one.

Shlomo Yanai

Bill?

Bill Marth

Yes. Right now, David, as you know we're waiting for our claims construction, there's no trial date set. So, whether the claims construction, whether the mile in that go date (ph) that gets rolled into that claims construction, it's very difficult to say at this point in time. Judge Jones is a fairly busy judge and so, we'll have to wait and see. We just don't know the timing of the claims construction. Once we get that of course, then we can get on to scheduling the trial and so on and so forth.

David Maris – Credit Agricole

Hey, but, Bill based on your best guesstimate, would you assume that it starts in the fall or early winter to get the result sometime mid-year next year?

Bill Marth

No, I think that that's very optimistic. I'd say much farther out than that.

David Maris – Credit Agricole

Great. Thank you very much.

Shlomo Yanai

Thank you all very much for joining us today. As you have heard we had a great quarter and we are very enthusiastic about the rest of 2010. So, thank you again and you have a good day.

Operator

Thank you. This concludes today's teleconference. You may disconnect your lines at this time. Thank you all for your participation.

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THE INFORMATION CONTAINED HERE IS A TEXTUAL REPRESENTATION OF THE APPLICABLE COMPANY'S CONFERENCE CALL, CONFERENCE PRESENTATION OR OTHER AUDIO PRESENTATION, AND WHILE EFFORTS ARE MADE TO PROVIDE AN ACCURATE TRANSCRIPTION, THERE MAY BE MATERIAL ERRORS, OMISSIONS, OR INACCURACIES IN THE REPORTING OF THE SUBSTANCE OF THE AUDIO PRESENTATIONS. IN NO WAY DOES SEEKING ALPHA ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER DECISIONS MADE BASED UPON THE INFORMATION PROVIDED ON THIS WEB SITE OR IN ANY TRANSCRIPT. USERS ARE ADVISED TO REVIEW THE APPLICABLE COMPANY'S AUDIO PRESENTATION ITSELF AND THE APPLICABLE COMPANY'S SEC FILINGS BEFORE MAKING ANY INVESTMENT OR OTHER DECISIONS.

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Source: Teva Pharmaceutical Industries Limited Q2 2010 Earnings Call Transcript
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