Israel Could Be Shut Down By General Strike

Israel’s Histadrut labor federation has threatened to launch a general strike this coming Sunday, in response Teva Pharmaceuticals’ plan to lay off half of its Israeli workforce, some 3,300 employees. According to the body’s chairman, the strike would be held for a few hours in the morning, possibly shuttering government offices, banks, public transit and Ben-Gurion Airport, among other places. For years, Teva was one of the largest and most profitable makers of generic drugs in the world and at one point employed more than 7,000 workers in Israel and directly contributed 1.3% of the country’s GDP. However, the company has since fallen on hard times, as regulatory changes in the U.S., making it easier for competitors’ products to reach the market, have led to a reduction in the price of generic drugs. At the same time, the Food and Drug Administration in October approved a generic version of Copaxone, which treats multiple sclerosis and has long been one of Teva’s most financially successful products. The business is also strapped with some $35 billion in debt following the ill-fated purchase of Allergan’s generic drug unit. Analysts believe that a nationwide strike in Israel, coupled with anticipated government pressure, could force Teva to cancel some of the layoffs, especially given the billions of shekels in tax deductions and subsidies the state has over the years granted the corporation.