Teva Pharma reaches $718 million tax settlement with Israel State

Israel-headquartered global generic drug giant Teva Pharmaceutical Industries (NYSE: TEVA) has reached an agreement with the Israel Tax Authority to pay 2.54 billion shekels (around $718 million) for the release of trapped profits, settling tax assessments for the years 2005-2007, and applying similar principles through 2011.

In total, Teva will pay about 2 billion shekels within the framework of amendment 69 to the Law for the Encouragement of Capital Investments (the "Trapped Profits Law”). This includes the payment of 336 million shekels made in May 2013. In addition, Teva will pay approximately 840 million shekels concerning tax assessments for the years 2005-2011.

Teva expects to incur a charge of around $235 million to be reported in the fourth quarter of 2013, which will be reflected in its non-GAAP results.