Teva Secures $500 Million Partnership to Accelerate New Vitiligo Therapy
Tel Aviv, Sunday, 11 January 2026.
Royalty Pharma commits up to $500 million to fast-track Teva’s immune-regulating antibody, explicitly targeting a 2026 start for Phase 2b trials to treat vitiligo patients.
Structuring the Capital Injection
On January 11, 2026, Teva Pharmaceutical Industries (NYSE: TEVA) and Royalty Pharma (Nasdaq: RPRX) formalized a funding agreement potentially worth up to $500 million to advance Teva’s anti-IL-15 antibody, TEV-’408 [1][2]. The deal is structured to mitigate risk while ensuring capital availability for critical development phases. Royalty Pharma is providing an initial $75 million specifically to co-fund a Phase 2b clinical trial for vitiligo, which is targeted to commence later this year [2][3]. Contingent upon positive data from this phase, Royalty Pharma retains an option to invest an additional $425 million to support subsequent Phase 3 development [1][3]. This optionality implies that approximately 85% of the total potential funding is performance-based, heavily incentivizing successful clinical outcomes.
Clinical Status and Scientific Focus
TEV-’408 is currently positioned at a pivotal stage in Teva’s immunology pipeline. The candidate is undergoing a Phase 1b study for vitiligo—a condition with an estimated global prevalence of 0.5% to 2%—and a Phase 2a study for celiac disease [1][3]. The mechanism of action targets Interleukin-15 (IL-15), a cytokine implicated in the signaling pathways of various autoimmune conditions [2]. This specific focus on IL-15 has already garnered regulatory attention; the U.S. Food and Drug Administration (FDA) granted Fast Track designation to TEV-’408 in May 2025, underscoring the urgent need for new therapeutic options in this space [1][3]. Teva anticipates sharing results from the ongoing TEV-’408 trials during 2026 [1].
Strategic Implications and Market Outlook
For Teva, this partnership is a key component of its “Pivot to Growth” strategy, designed to expedite the delivery of novel therapies without bearing the full financial burden of development alone [2]. Richard Francis, Teva’s President and CEO, noted that such collaborations allow the company to advance its scientific portfolio more efficiently [1]. This sentiment was echoed by Pablo Legorreta, CEO of Royalty Pharma, who highlighted that this is the second collaboration between the firms, reinforcing a long-term partnership model focused on funding potentially practice-changing therapies [2]. Should TEV-’408 eventually secure approval and market launch, the agreement stipulates that Teva will pay Royalty Pharma milestone payments and royalties on worldwide net sales [1].
Financial Context
The agreement arrives amidst a period of strengthening financial sentiment for Teva. Just weeks prior to this announcement, on December 24, 2025, S&P Global Ratings upgraded Teva’s credit rating to BB- [3]. This improved credit profile, combined with the non-dilutive nature of the Royalty Pharma funding, provides Teva with greater flexibility as it navigates the capital-intensive process of late-stage drug development. Additionally, the company has recently cleared other hurdles, such as securing a U.S. settlement date for the AVT06 biosimilar with Alvotech on December 19, 2025 [3].