Teva Pharmaceutical Industries Ltd (NASDAQ:TEVA) saw its shares soar in premarket trade as investors welcomed news that the generic drug maker is planning another round of restructuring and massive job cuts in a bid to cut its cost base and improve profitability.
That is not all, dividend payment has been suspended and the company has also cancelled its 2017 bonus programme.
READ: Teva Pharmaceutical Industries shares lifted as new chief Schultz starts turnaround plan
Further to its major overhaul of its management structure announced in November, the Israeli company has taken it a step further, announcing that it is now planning to cut 14,000 jobs or 25% of its workforce over the next three years.
Teva has been hit by competition from cheap generics.
The move is expected to cut costs by US$3bn by the end of 2019, the company said in a statement on Thursday.
The company is expecting to book a restructuring charge of at least US$700mln in 2018.
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"Today we are launching a comprehensive restructuring plan, crucial to restoring our financial security and stabilizing our business," chief executive Kare Schultz said in a statement.
"We are taking immediate and decisive actions to reduce our cost base across our global business and become a more efficient and profitable company."
The company will immediately suspend its dividend and cancel its 2017 bonus program. It is also reviewing the possibility of selling non-core assets.
In premarket trade, its shares were up 14.33% at US$17.98. In the regular session, shares gained almost 9% at US$17.08.