This brings Teva's total open interest to 1.6 million contracts.

Teva Pharmaceutical Industries Ltd. (TEVA) is on track for a turnaround, and investors have placed their bets.

The volume of Teva options contracts has jumped to a daily average of more than 100,000 this month, according to data from Bloomberg.

That brings the total open interest to 1.6 million contracts, more than both Pfizer Inc. (PFE) and Merck & Co. (MRK) combined.

The surge in options trades comes as Teva announced Thursday, Dec. 14, that it will slash a quarter of its global workforce - about 14,000 employees - as part of a cost cutting plan aimed at reducing the generic drug maker's cost base by $3 billion by the end of 2019. Also on Thursday, Teva decided to suspend its dividend.

Shares of the Israeli company gained 10.7% to $17.37 mid-afternoon Thursday.

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