“We will continue to invest heavily“ Bayer Aspires to Significantly Expand Life Science Businesses
After Bayers decision to spin the Material Science business off the company concentrates in Life Science. The Group aims to achieve strong sales and earnings growth for its Life Science businesses in the coming years.
Leverkusen, Berlin/Germany – “We are also optimistic for the medium term and have great plans for the Life Science businesses,” said CEO Dr. Marijn Dekkers at the “Meet Management” investor conference in Berlin. Bayer seeks to considerably increase sales and margins at Health Care, in particular, through 2017, driven mainly by the recently launched products in Pharmaceuticals and by the Consumer Care business, which was greatly strengthened last year through acquisitions.
At Crop Science, Bayer aims to continue achieving above-market growth and to maintain an industry-leading margin, with the agricultural business benefiting particularly from new crop protection products. “We will continue to invest heavily so that we continue to be successful with innovative products,” said Dekkers.
“The outlook for our health care business is particularly positive thanks to the five pharmaceutical products we recently launched,” added Dekkers. “They have played a crucial role in making us one of the fastest-growing large companies in the pharma-ceutical industry.” Combined sales of the anticoagulant Xarelto, the eye medicine Eylea, the cancer drugs Stivarga and Xofigo, and the pulmonary hypertension drug Adempas are projected to increase toward EUR 4 billion in 2015 (2014: EUR 2.9 billion), he said, putting the peak annual sales potential of these products at a total of at least EUR 7.5 billion.
High Hxpectations for Sales and Earnings over the Medium Term
Bayer aspires to grow Health Care sales by an average of about 6 percent a year through 2017 to more than EUR 25 billion (2014: EUR 20.0 billion) and to increase the Ebitda margin before special items to between 29 and 31 percent (2014: 27.5 percent). These estimates are based on exchange rates as of December 31, 2014, including a rate of USD 1.21 to the euro. The percentage changes in sales are based on pro forma figures that present the acquired businesses as if the acquisitions had been completed on January 1, 2014.
Bayer aims to increase sales at Pharmaceuticals by approximately 7 percent each year through 2017, to more than EUR 15 billion (2014: EUR 12.1 billion) and to achieve an Ebitda margin before special items of between 32 and 34 percent (2014: 30.7 percent) in this division. The margin level will be largely determined by the success of the commercialized products – and also by the progress of the projects currently in the research and development pipeline, explained the CEO. He said that the better the Pharmaceuticals pipeline develops, the more investment will be required for further clinical trials.