#13: Bayer HealthCare
Headcount 111,400
Year Established 1971
Pharma Revenues $14,485 -1%/+4%*
Total Revenues $46,593 7%/+13%*
Net Income $1,728 -9%/-4%*
R&D Budget $2,325 6%/+11%*
* Converted at avg. exch. rate / based on reported currency (EUR)
Top-Selling Drugs in 2010
Drug |
Indication |
$ |
(+/- %) |
Betaferon |
multiple sclerosis |
$1,601 |
-5% |
Yasmin |
contraception |
$1,475 |
-17% |
Kogenate |
hemophilia |
$1,333 |
8% |
Nexavar |
oncology |
$936 |
11% |
Adalat |
hypertension |
$882 |
0% |
Mirena |
women’s health |
$716 |
5% |
Avalox |
antibiotic |
$660 |
3% |
Levitra |
erectile dysfunction |
$570 |
13% |
Account for 56% of total pharma sales, down from 57% in 2009.
PROFILE
Bayer had a rough 2010, following what it called a “crisis year” of 2009. Yasmin lost patent protection in the U.S. in June 2010, leading to a 17% revenue drop for the year, while top seller Betaferon slipped 5% (flat in Euros) due to competition. Times are so tough, the company decided to change the name of its pharma unit; “Bayer Schering” has become “Bayer Healthcare,” as part of a January 2001 streamlining. (Also, the company stopped giving info for its diagnostic imaging business, so those revenues are now counted as part of pharma sales.)
The bright spots were Nexavar and Kogenate, which posted double-digit gains (in Euros) due to market growth, but they weren’t enough to offset the long-term decline of top products. In November 2010, parent company Bayer AG announced a restructuring plan that would cover all of its major units. More than one-third of the 4,500 layoffs planned in the $1.3 billion overhaul will come from Germany; 2,500 new hires are also planned, primarily in emerging markets. The company didn’t break down the layoffs by unit — Healthcare, Crop Science and Material Science — but it’s believed that pharma will take the brunt of it. The moves are expected to generate $1.1 billion in annual savings.
Bayer’s prospects for growth appear tied to Xarelto, its warfarin- and Lovenox-buster co-developed with J&J. Xarelto has been available in Europe since 2008 and is on the market in 75 countries, but the FDA has yet to clear it. Bayer predicts peak sales of nearly $3.0 billion for the drug, but it’ll need to convince the agency that the benefits offset the bleeding risks. The company also has high hopes for its age-related macular degeneration treatment, VEGF Trap-Eye.
In May 2011, Bayer AG’s new chief executive officer, Marijn Dekkers (appointed in October 2010), mentioned that he was open to a “merger of equals” for the healthcare unit, as long as it won’t cost too much and Bayer doesn’t give up control. Thus ends the competition for the most unrealistic comment by an industry CEO this year. —GYR
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