Teva Pharmaceutical Industries Ltd's (Nasdaq: TEVA; TASE: TEVA) acquisition of Cephalon Inc. (Nasdaq: CEPH) is causing far-reaching changes in Teva's brand drug operations. Sources inform ''Globes'' that Teva plans to set up a venture capital fund to invest in Israeli drug development companies.

Teva Innovative Ventures head Dr. Aharon Schwartz will be responsible for investing in start-ups and reaching licensing agreements with universities as part of the company's effort to expand its pipeline of innovative drugs.

Teva has already invested in several Israeli drug development start-ups. Investing through a corporate venture capital fund, rather than directly, has significant implications. A venture capital fund will be a legal and corporate entity separate from Teva. This should ease fears of potential target companies that accepting money from Teva might deter other potential investors.

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