Analysts at

Salomon Smith Barney

have downgraded shares in

Teva Pharmaceuticals

(Nasdaq:TEVA) from an Outperform, to a Neutral, and cut the stock's price target from $64 to $49 (which is 8% lower than the share's last price on the Nasdaq).

The analysts also believe that Teva's growth rate per share during the years 2002-2003 will be no greater than 20% annually. That's in comparison to an annual growth rate of 33% per share from 1998-2001.

The investment house says that Teva is too large a generic company to continue sustaining an annual 25%-30% per share growth rate. It also says that Teva's research and development division will only begin contributing to the firm's profitability in 2004.

SSB says that according to the company's expected profit multiple for 2002, the firm's stock is trading at a premium of 43%, compared with other drug companies in the United States. But the SSB analysts admit that their outlook on the share is in contrast to the general consensus regarding Teva's stock.

Teva is a fully integrated global pharmaceutical company producing drugs in all major therapeutic categories. In the area of proprietary drugs, Teva has focused on products for central nervous system disorders, primarily the development of its first globally marketed branded drug, Copaxone, a treatment for relapsing-remitting multiple sclerosis. Teva also possesses manufacturing operations for active pharmaceutical ingredients (API).

Teva Pharmaceuticals USA, Inc., Teva's principal United States subsidiary, is a generic drug company which manufactures 137 generic products in 210 generic forms, which are distributed and sold in the United States, together with 15 additional generic products in 29 dosage forms manufactured by third parties. Teva manufactures over 270 generic products in 600 dosage forms, which are sold primarily in the Netherlands, the United Kingdom and Hungary. A total of 85% of the company's sales take place outside of Israel.

Within the past two weeks, Teva received FDA approval to market two of its new generic drugs. These include the drug Famotidine that is the generic form of Pepcid a drug that fights stomach acids, and Lisinopril, which is the generic form of the drug Prinzide, which is a high blood pressure drug.

As SSB admits, its recommendation goes against the consensus. Just two weeks ago, before Teva announced its recent FDA approval,

Bank Hapoalim

analysts published a report on Teva stock, giving it an Accumulate recommendation and a price target of $63.