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Teva Pharmaceutical reports big drop in profits, cuts dividend

JERUSALEM, Aug 3 (Reuters) - Israeli drugs group Teva Pharmaceutical Industrial Industries reported a steeper than expected 18.4 percent drop in second-quarter earnings on Thursday, due to weaker prices in the United States, and cut its interim dividend by 75 percent.

Teva, the world's largest generics drugmaker, said it earned $1.02 per share excluding one-off items in the second quarter, down from $1.25 a share in the same period last year. Revenue rose 13 percent to $5.7 billion.

It cut the quarterly dividend payout to $0.085 per ordinary share from $0.34.

Teva, which bought Allergan's generics business for $40.5 billion in August, was expected by analysts to have earned $1.06 per share on revenue of $5.72 billion, according to Thomson Reuters I/B/E/S Estimates.

Teva was left without a permanent chief executive in February after Erez Vigodman stepped down, leaving new management to restore confidence in the world's biggest generic drugmaker after a series of missteps. Its chief financial officer has also said he will step down in the next few months.

Global sales of Teva's best-selling multiple sclerosis drug Copaxone fell 10 percent in the quarter to $1.02 billion.

As a result the company has cut its full-year earnings forecast to $4.30-$4.50 a share from $4.90-$5.30 previously on revenues now expected to total $22.8-$23.2 billion, down from its previous forecast of $23.8 billion-$24.5 billion.

"This adjusted outlook takes into consideration the impact of increased price erosion in our U.S. generics business, which is expected to be in a high single-digits rate through the remainder of the year, and delays in generic launches in the U.S.," Teva said.

It added that the outlook for the business also reflected the continued deterioration in political and economic conditions in Venezuela, but it assumed no generic competition to its Copaxone 40mg version in the United States in 2017.

Earlier Teva said it would continue to pursue a breach of contract suit against the former owners of its Rimsa plant in Mexico after a New York judge rejected Teva's claim of fraud. (Reporting by Steven Scheer; Editing by Greg Mahlich)