v3.26.3
Fair value measurement
 9 Months Ended
Sep. 30, 2026
Fair Value Disclosures [Abstract]  
Fair value measurement FAIR VALUE MEASUREMENT:
Financial items carried at fair value on a recurring basis as of September 30, 2026 and December 31, 2025 are classified in the tables below in one of the three categories of fair value levels:
September 30, 2026
Level 1 Level 2 Level 3 Total
(U.S. $ in millions)
Cash and cash equivalents:
Money markets$3,003 $— $— $3,003 
Cash, deposits and other1,082 — — 1,082 
Investment in securities:
Equity securities15 — — 15 
Other3 — — 3 
Derivatives:
Asset derivatives:
     Options and forward contracts— 52 — 52 
Liability derivatives:
     Options and forward contracts— (56)— (56)
     Cross currency interest rate swap— (14)— (14)
Contingent consideration*— — (43)(43)
Total$4,103 $(18)$(43)$4,042 
December 31, 2025
Level 1Level 2Level 3Total
(U.S. $ in millions)
Cash and cash equivalents:
Money markets$2,678 $— $— $2,678 
Cash, deposits and other878 — — 878 
Investment in securities:
Equity securities16 — — 16 
Other3 — — 3 
Derivatives:
Asset derivatives:
     Options and forward contracts— 86 — 86 
Liability derivatives:
     Options and forward contracts— (38)— (38)
     Cross currency interest rate swap— (19)— (19)
Contingent consideration*— — (51)(51)
Total$3,575 $29 $(51)$3,553 
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*    Contingent consideration represents liabilities recorded at fair value in connection with acquisitions.

Teva determined the fair value of the liabilities for contingent consideration based on a probability-weighted discounted cash flow analysis. This fair value measurement is based on significant unobservable inputs in the market and thus represents a Level 3 measurement within the fair value hierarchy. The fair value of contingent consideration is based on several factors, such as cash flows projected from the success of unapproved product candidates; probability of success of product candidates, including risks associated with uncertainty regarding achievement and payment of milestone events; time and resources required to complete the development and approval of product candidates; life of the potential commercialized products and associated risks with obtaining regulatory approvals in the United States and Europe, and the risk adjusted discount rate for fair value measurement. The discount rate applied ranged from 7.5% to 11%. The weighted average discount rate, calculated based on the relative fair value of Teva’s contingent consideration liabilities, was 8.3%. Contingent consideration is evaluated quarterly, or more frequently, if circumstances dictate. Changes in the fair value of contingent consideration are recorded in the consolidated statements of income. A change of the discount rate by 1% would not have resulted in material changes to the contingent consideration liabilities.
The following table summarizes the activity for the financial assets and liabilities where fair value measurements are estimated utilizing Level 3 inputs:
Nine months ended September 30, 2026Nine months ended September 30, 2025
(U.S. $ in millions)
Fair value at the beginning of the period$(51)$(401)
Adjustments to provisions for contingent consideration:
     Allergan transaction— (25)
      Eagle transaction(20)(20)
      Novetide transaction(2)(1)
Settlement of contingent consideration:
      Allergan transaction— 212 
      Eagle transaction28 35 
      Novetide transaction2 2 
Fair value at the end of the period$(43)$(198)

Financial instruments not measured at fair value
Financial instruments measured on a basis other than fair value mostly consist of senior notes, sustainability-linked senior notes and convertible senior debentures (see note 7) and are presented in the table below in terms of fair value (level 1 inputs):
Estimated fair value*
September 30,December 31,
20262025
(U.S. $ in millions)
Senior notes and sustainability-linked senior notes included under senior notes and loans$12,152 $15,128 
Senior notes and convertible senior debentures included under short-term debt4,033 1,801 
Total$16,185 $16,929 
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* The fair value was estimated based on quoted market prices.