Eli Hurvitz and the creation of Teva Pharmaceuticals: An Israeli Biography

by Yossi Goldstein

  Later, after changing into khaki pants and a white shirt, Eli arrived at the kibbutz and was led to the traditional Jewish wedding canopy (huppah) by his father and the father of the bride. He was followed by Dalia, who arrived via tractor. The rabbi from the Jordan Valley presided over the ceremony. The ceremony was followed by an informal program in which friends congratulated the newlyweds and told long-forgotten stories. The celebration continued with a sing-along of Jewish Israeli folk songs and a kibbutz-style meal and concluded with dancing until dawn. A recorder and an accordion provided the musical accompaniment for the evening.

  As was customary on kibbutzim at the time, the day after the wedding was a workday like any other. Shortly after the wedding, however, Dalia and Eli made the unconventional move of sailing to Europe for their honeymoon. This was no trivial matter for the newlyweds, who were loyal members of a socialist kibbutz. They received the tickets for the trip as a wedding gift and were assured that once in Europe, they would be hosted by relatives. Their main destinations were Eli’s relatives in France and Dalia’s uncle, who was serving as Israel’s economic attaché in Sweden at the time.

  In some ways, their honeymoon was somewhat surprising, as Eli was devoted to the ideology and worldview of the kibbutz. But Eli also had his own views on the essence and nature of kibbutz life and on one occasion even published his reflections in the local kibbutz bulletin.

  Although he was a loyal kibbutz member, Eli believed that kibbutz life should provide more individual freedom, an outlook similar in many ways to the somewhat less collective settlement model of the moshav. In his article, Eli rejected the traditional socialist kibbutz ideology by which all members were expected to work to the best of their ability and have all their needs provided for, regardless of their actual production and abilities. Instead, he posited that neither work nor remuneration could be equal for everyone since the work performed by some was more valuable than the work performed by others. In simple and practical terms, he wrote, “on the kibbutz, there were always those who wanted to work and those who did not want to work” and that “you could not expel or punish those who did not want to work,” as this is human nature. For this reason, he maintained, workers should be rewarded for their accomplishments. He even proposed what he regarded as a more just division of work on the kibbutz, which involved the distribution of bonuses to efficient workers.

  “We are in need of added value,” he explained years later. “Together, this added value and personal incentive produce a synergy.”

  Eli also argued that kibbutz members should not only be allowed to but also should be encouraged to develop their own interests. Ultimately, he believed, the ideal way of life that had been developed by the kibbutz founders could not survive. The land of the kibbutz, he believed, was destined to be split into equal parcels, each assigned to a member who would develop it as he saw fit. Quite expectedly, Eli’s contribution to the local bulletin, which was highly unusual at the time, encountered a cool reception. However, in light of the path of privatization subsequently taken by many of Israel’s kibbutzim, it is clear that he possessed an accurate long-term understanding of the inner dynamics of kibbutz life that was well ahead of its time.

  Despite his unorthodox views on the subject, Eli was somewhat troubled by the fact that he was able to enjoy a honeymoon abroad. Nonetheless, the young couple set sail for Italy, visited France, and ultimately made their way to northern Sweden.

  “We were truly paupers, Eli recounted, “without a penny to our name.”

  Eli and Dalia spent the months after their honeymoon at Tel Katzir. As was typical at kibbutzim at the time, they were allocated a small one-room apartment with two Jewish Agency beds, a kitchenette, and a small bathroom. At the time, these things were considered luxuries, but their fellow kibbutz members believed they deserved them. After all, they had gotten married. Now, both Eli and Dalia worked on the kibbutz: Dalia in the kibbutz food storage and supply facility, and Eli, as in the past, plowing the kibbutz fields and fishing in the Sea of Galilee. Eli was also being asked increasingly frequently to shoulder the burden of kibbutz management as part of the kibbutz secretariat. He had demonstrated his talent for such work in the past and it was clear that his work in this capacity was of greater value to the kibbutz than his work in other positions. He therefore spent an increasing amount of time tending to the ever-growing daily needs of his kibbutz, which required weekly trips to faraway Tel Aviv and other cities in Israel.

  •••

  Eli and Dalia lived on Tel Katzir as a married couple for only a few months, during which they appear to have been increasingly occupied by thoughts of leaving. Dalia regarded kibbutz life as a burden that was difficult to bear and her faith in communal living declined steadily with the passage of time. When the first of their friends started to leave the kibbutz, both she and Eli viewed their decisions unsympathetically. They were angry at them for abandoning the community and considered them “traitors,” as Dalia referred to them years later.

  ”The kibbutz members threw things at the vehicle in which they left,” Dalia recounted in all seriousness.

  But as the stream of their peers leaving the kibbutz swelled, their second thoughts about remaining there themselves intensified. Unlike Dalia, Eli still believed strongly in the fundamental conception of kibbutz life and always described life on Tel Katzir in a positive, optimistic, and loving tone.

  “I enjoyed myself at every moment,” he recalled. “We were very satisfied.”

  But Eli also wanted other things out of life, for example – a university education. For the past few years, his mother had been pushing him in this direction in her quiet yet determined way. During the previous year, 1953, Eli began to take advantage of his trips to Tel Aviv to pay visits to the new branch of the Hebrew University that had opened its doors in the city.21 He sat in on classes there that interested him, particularly in the field of economics. Later, he even began to plan his weekly trips to the city in accordance with the university’s class schedule.

  His growing desire to study was accompanied by growing criticism of communal kibbutz life. Although Eli had considered the problems of kibbutz life in the past, he was now overcome by an ever-intensifying conviction that the system was fundamentally flawed. He was also influenced by the fact that many of his friends from the founding settlement group were leaving the kibbutz. Eventually, only a handful of founding members remained at Tel Katzir and Eli did not have the same rapport with those who arrived later. This saddened and frustrated him. He had forged such deep friendships with his fellow members over the years and now these friends were starting to disappear as if they had never existed.

  Eventually, they left the kibbutz. Dalia came to terms with their imminent departure more quickly than Eli did and pushed harder than he to leave. Their misgivings about remaining on Tel Katzir were also influenced by another factor, which they learned about during their honeymoon. A well-known physician examined Dalia while they were in Sweden due to a heart condition that had been troubling her for a few years. The physician was familiar with the climatic conditions and intense heat of the Jordan Valley and urged them to move somewhere with a different climate before Dalia suffered serious injury. Although Dalia was less concerned by the doctor’s prognosis than Eli, her condition constituted an additional, and perhaps decisive, factor in her decision to leave the kibbutz. The medical factor may also have ultimately made the decision easier for her. Eli took the doctor’s prognosis much more seriously. According to Eli, “the doctor’s opinion is what made us come to terms with leaving.” As far as he was concerned, it was their reason for doing so.

  The die had been cast. Their day of departure, in late September 1953, was a difficult one for Eli. He felt a strong connection to Tel Katzir, which he and his companions had founded.

  “Those were my most beautiful days,” Eli later recalled, nostalgically recounting the difficulty he had leaving the kibbutz
.

  He knew that he was needed there and that he was one of the settlement’s most essential members, which made the decision even more emotionally difficult for him, not just at the time but in years to come. Indeed, despite his love for the place where he had spent almost five years of his life, his conscience troubled him to such an extent that, some two decades later, he was still unable to return for a visit.

  “Once, during a weekend, I snuck onto the kibbutz so they wouldn’t see me, just to look around,” he recalled painfully.

  “I betrayed my fellow members,” he said some 58 years later, concisely summing up his feelings on the subject.

  •••

  Life on the kibbutz had a profound impact on Eli, although this may seem somewhat paradoxical at first. After all, during his years on Tel Katzir, he believed deeply in socialist ideology.

  “I identified with the ideology 100 percent, even though I knew deep down that there was something childish about my belief. But here [on Tel Katzir], it did not exist,” he explained. “I followed it wholeheartedly. It was my belief, and I was willing to fight for it … I was a socialist who read Karl Marx and knew the history of the socialist doctrines by heart.”

  For most of his life, however, Eli espoused the opposite worldview, that of capitalism, which regarded the free market as the most proper, effective, and just economic system of all.

  In reality, the contradiction was not as unequivocal as it seems. Upon more thorough assessment, we can identify in Eli, and other Israeli industrialists of his generation, a form of capitalism that differed substantially from the capitalism typical of places such as the United States. For Eli and his friends, it was important that their model of capitalism also incorporate concepts such as compassion, humanity, and consideration of others. This approach would have a major impact on his management of Teva and the good relations he forged with its workers over a period of decades, which were clearly reflected in the widespread sense of employee satisfaction with the company’s labor policies.

  “In many ways, I would not define myself as a typical capitalist,” Eli explained almost six decades after leaving his kibbutz.

  Many of my socialist friends are much more passionate in their support of the free market than I am. A person who ends up wealthy – and this is especially true in my case, because I never expected it – bears a true and sincere responsibility toward those who are not as fortunate… And I am not alone. I believe that Dov Lautman, Michael Strauss, Stef Wertheimer, and others share this view.

  Chapter 5

  From the University to Turkey

  Returning to Tel Aviv posed several challenges to Eli. His heart was still in Tel Katzir and the abrupt departure from a place that had been so significant to him made it difficult to simply continue with life as usual. Having grown up in Tel Aviv, Eli understood the city and knew what to expect in it. Yet the four years he had spent on the kibbutz at the foot of the Golan Heights left a mark on him. Although the city had a great deal to offer, it lacked precisely the things that had been the most important aspects of Eli’s life at Tel Katzir: its unique worldview; its collective mentality; the strong sense of solidarity and friendship among the members of his settlement group; the security-related tension; the work in the scorching sun; and, as Eli described it, the invigorating feeling of “opening the door in the morning and seeing the Sea of Galilee stretched out before your very eyes.”

  But life went on and it did not take long before Eli put the past behind him. A rationalist at heart, he moved on to the next phase of his life. He repressed his longings, found new directions, and convinced himself that the world might have other, different good things to offer.

  Meanwhile, Tel Aviv had become home not only to Eli’s parents but also to Dalia’s parents, Nachman and Malka Salomon. His in-laws had moved there from Jerusalem because of Nachman’s job. All three families lived relatively close to one another: Eli and Dalia at 14 Chen Boulevard, the Hurvitzes at 78 King George Street, and the Salomons at 38 Hashoftim Street. Eli and Dalia rented the apartment of the uncle they had visited in Sweden; their home was spacious by the standards of the time, certainly in comparison to their small apartment on the kibbutz. Their new home had three rooms plus a bathroom and a kitchen.

  The most dramatic change for the young couple was where they worked. Dalia moved directly from the kibbutz’s chicken coops and communal kitchen to the classrooms of the Tel Hai School. She was convinced that from that point on, her purpose in life was education. In an effort to acquire in-depth knowledge of the field, she began studying to earn her teaching credentials at the Kibbutzim College of Education. Eli chose a different direction. It was clear to him that the next phase of his life would be dedicated to academic study. He therefore went from farming, fishing, and working in the kibbutz secretariat to a fundamentally different vocation and lifestyle that helped quiet his longings for Tel Katzir. He enrolled in the newly established Tel Aviv branch of the Hebrew University of Jerusalem, the nucleus of what would later evolve into Tel Aviv University. He began studying economics, a subject that had fascinated him since high school.

  His interest in economic issues had increased further after he began sitting in on classes regularly during his visits to Tel Aviv on kibbutz business. Even then, he knew that his favorite economic topics were those that dealt with the academic principles of industry, what was then referred to as “industrial economics.” Even before he left Tel Katzir, he was convinced that the future of the Israeli economy would be played out on the production lines, contrary to the worldview of the founding fathers of collective Jewish-Zionist agricultural settlement in the country. Eli was convinced that only industry could provide Israel with the rapid growth and modern economy it needed.

  Eli began his university studies in the fall of 1953. He enjoyed them and worked hard on his assignments. Three years later, he completed his BA in economics. University studies did not appear to be overly difficult for him, except for the fact that work sometimes occupied a great deal of his time, repeatedly forcing him to take advantage of the university’s second sitting to make up missed exams. Although he was a hard-working student who earned relatively high grades, he never once thought that his future lay in academia. His mind was elsewhere: in the Assia pharmaceutical plant, where he started working during his studies.

  •••

  When he arrived in Tel Aviv, Eli, now 21 and married, knew he would have to find a job immediately. For him, “living off his parents,” as some of his friends were doing, was out of the question. However, the high cost of living in the city meant that the little money he had lasted only a few weeks. Everyday expenses, rent, and tuition for himself and Dalia all needed to be paid immediately. Eli wasted no time and quickly landed a job in the municipality’s youth agency. However, it soon became clear that the funds that had been promised to the municipal agency would become available only during the second half of the following year and Eli could not wait until then. Next, he tried to follow in his father’s footsteps, finding work in construction. However, he quickly realized that he would have to find a line of work that would allow him to devote a substantial amount of time to his studies, which were his main focus at that time. This led him to do something he had refrained from previously: he asked Dalia’s father Nachman for a job in the family business, the Assia pharmaceutical plant. Nachman managed the plant in Petah Tikva with his father Haim and his two partners.

  A few months earlier, Dalia’s grandfather, 76-year-old Haim Salomon, who was one of the company’s founders, had asked Nachman to take over the management of Assia (then known as Salomon, Levin, and Elstein, or SLE Ltd.). At the time, Nachman had been managing the Assia branch in Jerusalem. During the preceding five years, following the death of the company’s first CEO, Dr. Ludwig Shere, Nachman had started taking on some of his responsibilities and serving as acting CEO. He now took on the position officially and moved to Tel Aviv. Since Assia had been
founded and run as a partnership between the Salomons and two other families, Eli had concluded that it would not be wise to ask Nachman for a job. Eli did not want to force him to favor a family member, especially right after he had become the CEO. Yet Eli was convinced that he could contribute to the company and pursue his studies at the same time.

  Eventually, Eli worked up the courage to approach Nachman, who promptly offered him a desk job. Candidly and politely, Eli explained that he knew nothing about office work. Nachman, who was generally a serious man but who appeared to be joking at the time, asked his son-in-law if he knew how to wash dishes. Eli took Nachman up on his offer and was assigned to the plant’s analytical laboratory, then headed by Dr. Haim Yelin, director of the Chemistry Department, the Sterile Department, and the Assia laboratories. Eli worked directly under Amihud Carmi, an extremely knowledgeable, certified chemist who had once been a teacher at the Herzliya Gymnasium but left teaching for medical reasons. Eli’s job was to clean and sterilize the equipment that accumulated during the day. His wages were 72 Israeli pounds (liras) per month, among the lowest at the company.

  •••

  The Assia plant had been established by three partners. Its roots stretched back to the L’ma’an Tziyon (meaning For the Sake of Zion in Hebrew) pharmacy located just across from the Nablus Gate of the Old City of Jerusalem, where Dalia’s grandfather Haim had started working in 1898. Three years later, after learning the trade, he opened a pharmaceutical retail business with his brother-in-law Moshe (Gutel) Levin called Salomon and Levin. Levin was born in Lithuania, but his family moved to Ireland when he was young and then moved on again, this time to Jerusalem, when he was 13 years old. They lived in the Mea She’arim neighborhood, where he met and married Haim’s sister Zipporah and had eight children. In 1904, Haim’s brother-in-law was named chairman of the Jewish community of Haifa, where he had opened a new branch of the business. In 1913, the two partners decided to expand. They purchased the Lapin pharmaceuticals business on Bustrous Street (today Eilat Street) in Jaffa and took on a third partner, Yitzhak Elstein, who was married to Hannah, one of Haim’s other sisters. When Elstein was 17, he had travelled to Chicago with his sister and two brothers and studied business administration there. After saving some money, he returned to Palestine and was appointed to manage the business in Jaffa. From then on, the partners were unofficially known as the three brothers-in-law and the company’s name was changed to Salomon, Levin, and Elstein: Wholesale Pharmaceutical Distributors.