Bayer posts strong earnings growth
pharmafile | October 29, 2015 | News story | Manufacturing and Production, Research and Development, Sales and Marketing |
Sales across the Bayer group rose by 1.9% in the third quarter of 2015 to €11 billion, according the company’s latest financial results.
Bayer’s Net income in the third quarter also rose to around €1 billion, compared with €8 million in the same quarter of 2014.
Sales in the healthcare sub-group increased by 8.3% in the third quarter, to €5.7 billion. The healthcare area benefited from Bayer’s recent launch of five pharmaceutical products – Xarelto, Eylea, Stivarga, Xofigo and Adempas – which posted combined sales of just under €1.1 billion. Bayer posted strong gains particularly for the anticoagulant Xarelto, which registered a sales gain of 31.3%, and the eye medicine Eylea, rose significantly – advancing by 67%. Sales in the pharmaceuticals division rose by a substantial 11.7% to €3.5 billion.
Based on the prevailing exchange rate, Bayer says it is planning group sales in the region of €46 billion – slightly lower than the previous forecast of €47 billion. “This still corresponds to a low-single-digit percentage increase on a currency- and portfolio-adjusted basis. We now expect positive currency effects of approximately 6% compared with the prior-year period, instead of the previous figure of 7%,” the report says.
On the cost side, Bayer increased its R&D investment in the pharmaceuticals division. The firm is looking to make R&D gains from its restructure, which created three divisions within the group – pharmaceuticals, consumer health and crop science.
Despite its most recent acquisitions – including particularly the consumer care business of Merck & Co – Bayer is planning a new ‘strategic focus on its life sciences business.’
In a conference call to announce the company’s third quarter results, Dr Marijn Dekkers, Bayer group chairman said: “Our business model… makes us the only company focussed across all the species. There are a lot of common rules across the species that we hope to benefit from and apply across the species – that’s a long-term R&D opportunity that we are definitely resourcing.”
Dekkers also spoke about his predictions for growth and losses in 2016, when he expects the recently-launched drugs to continue their strong performance, and unavoidable losses from off-patent drugs.
“Our recently introduced products will continue to gain sales momentum. The five products will have this year sales of €4 billion; whereas three to four years ago their sales were almost negligible. This has added a lot of our sales, and pharmaceuticals has had double-digit growth in the last few years. We don’t think the maximum potential has been reached yet. We believe there’s more from their growth to see.
“However in 2016 our older products that are not patent protected anymore will be affected. Some products are already eroding over time because of generic competition. They lose a few percent [in sales] every year – the task for us is to make the erosion as slow as possible.”
Lilian Anekwe
