Shares of the Israeli pharma giant Teva Pharmaceuticals (TEVA) were falling on Tuesday after a ratings downgrade.
Shares of Teva were lower over 4.6% during midday trading on Tuesday after Fitch Ratings slashed its rating, including its Long-Term Issuer Default Rating (IDR) to "BB" from "BBB-."
Additionally, Fitch's rating outlook on Teva is now "Negative."
"Fitch's rating action reflects the belief that Teva is facing significant operational stress at a time when it needs to reduce debt from the August 2016 acquisition of Actavis' generic drug business," the ratings agency said.
"Pricing pressure in Teva's North American generics segment and erosion of sales of Copaxone will continue to weigh on free cash flow in the near term, requiring the company to continue to sell assets or find external capital resources to meet debt obligations in 2018 and 2019 and beyond," Fitch added.
The agency's "Negative" outlook is based on the uncertainties encompassing whether Teva's challenges will intensify and the timing of the company's response to said challenges, namely a reduction of debt.
Shares of Teva are lower over 65% year-to-date.
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