Teva Pharmaceuticals (NYSE:TEVA) is having a Monday of nightmares as some of the company’s products have led to lawsuits, which brought about a major analyst downgrade, causing TEVA stock to plummet early in the week.
The Israel-based pharma business with a global reach suffered today as the company’s opioid-linked litigation has only started to kick off, with thousands of new lawsuits on the horizon. The harmful painkillers recently led to a judge giving the green light for an $85 million settlement in the state of Oklahoma, ensuring that the company will not promote opioids in the state.
This is only the tip of the iceberg for Teva, which had a Monday that saw Morgan Stanley lower the stock’s rating from an Equal Weight to an Underweight. The firm added that its price target on TEVA stock has now decreased from $16 per share to $6 per share.
Morgan Stanley analyst David Risinger noted that the pharmaceutical giant, as well as competitors such as Endo International PLC (NASDAQ:ENDP), are experiencing “underappreciated risks” coming from buying group pressure, which are now more negative than predicted.
These include a rise in generic competition, as well as the aforementioned opioid-related suits. The note arrived soon after Argus Capital upped its rating on TEVA stock to a buy with a $12 price target on July 5, 2019.
TEVA stock fell 7.5% by day’s end, while ENDO stock slid 3.7%.