By Keith Speights
Some financial deals are more than just financial deals. Blackstone (BX) Life Sciences' $400 million commitment to Teva Pharmaceutical Industries Ltd. (TEVA) in March could be an example.
Blackstone is a giant in the alternative asset management world. Its
Blackstone Life Sciences (BXLS) team includes 20 healthcare experts with
M.D.s or Ph.Ds. BXLS has invested in over 200 medicines that were
eventually commercialized. Its success rate for investing in phase 3
drugs is an impressive 86%.
In a real sense, Blackstone's agreement to fund the development of
experimental autoimmune disease drug duvakitug is a bet on Teva's
future. What does the "smart money" know that most investors don't?
Image source: Getty Images.
What Blackstone sees
Why was Blackstone willing to pony up $400 million for advancing
duvakitug? The drug is highly promising. Duvakitug is a human monoclonal
antibody that targets TL1A (tumor necrosis factor-like ligand 1A), a
protein that's a key regulatory within the body's immune system.
Teva and its partner, Sanofi (SNY),
are currently evaluating duvakitug in Phase 3 clinical studies as a
potential treatment for ulcerative colitis and Crohn's disease. The
companies also announced positive results earlier this year from a Phase
2 study of the drug, which showed durable efficacy over 44 weeks in
patients with those autoimmune diseases.
Paris Panayiotopoulos, Senior Managing Director with BXLS, stated in
the press release announcing the $400 million financing deal with Teva,
"Duvakitug has the potential to be a best-in-class therapy in a large
and growing space." He added, "The Teva and Sanofi teams are well
positioned to develop and commercialize this important medicine."
BXLS Global Head, Dr. Nicholas Galakatos, also reinforced that the
interest wasn't solely in duvakitug's prospects. He stated, "This
transaction further demonstrates our focus on partnering with leading
biopharmaceutical companies to execute their growth initiatives."
A new and improved Teva
The Blackstone investment underscores that Teva is no longer just a
middling generic drug maker. The Israel-based company is now a leading
biopharmaceutical innovator.
In addition to duvakitug, Teva's pipeline features two other
innovative medicines in late-stage testing. Olanzapine long-acting
injectable targets schizophrenia. Teva awaits U.S. Food and Drug
Administration (FDA) approval for the drug. The company is also
evaluating TEV-'248, a dual-action rescue inhaler for the treatment of
asthma, in a Phase 3 study.
Teva continues to be a leader in biosimilar development as well. The
drugmaker awaits FDA approvals for five biosimilars to successful drugs,
including Eylea, Prolia, Simponi, and Xgeva.
Credit ratings agencies are recognizing Teva's turnaround. In December 2025, S&P Global (SPGI) upgraded Teva's credit rating to BB+ from BB, with a stable outlook. Moody's (MCO) also revised its outlook for Teva to positive from stable.
Wall Street is bullish about the pharma stock,
too. Of the 13 analysts surveyed by S&P Global in April who cover
Teva, 12 rated the stock as a "buy" or "strong buy." The sole outlier
recommended holding Teva.
Should you follow the smart money?
Investors should view Blackstone's $400 million commitment to Teva as
a powerful endorsement of duvakitug's commercial potential.
Importantly, Blackstone stands to receive milestone payments and low
single-digit royalties on worldwide sales of duvakitug if it wins
regulatory approval. The alternative asset management company definitely
has skin in the game.
But should you follow the smart money by investing in Teva?
Risk-averse investors will probably be better off staying away. However,
aggressive investors could find a lot to like about Teva. With a
forward earnings multiple of only 11.5, there's even a case to be made
that Teva is a value stock. If duvakitug succeeds as much as Blackstone expects, Teva could be a big winner for investors.
Should you buy stock in Teva Pharmaceutical Industries right now?
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Keith Speights
has no position in any of the stocks mentioned. The Motley Fool has
positions in and recommends Blackstone, Moody's, and S&P Global. The
Motley Fool has a disclosure policy.
This article was first published by The Motley Fool
