Bayer posts 2-percent drop in second-quarter prescription drug sales

Headline results for the second quarter:

Prescription drug sales

4.2 billion euros ($4.9 billion)

-2%

Revenue

9.5 billion euros ($11 billion)

+8.8%

Profit

799 million euros ($925 million)

-34.7%

Note: All changes are versus the prior-year period unless otherwise stated

What the company said:

With regards to prescription medicines, CEO Werner Baumann remarked "our key growth products continued to perform strongly overall," adding "we are on track to achieve our annual targets."

In response to a recent report that Bayer is mulling job cuts and outsourcing as part of a broad review of drug R&D, Baumann said the company is "constantly reviewing" all of its businesses for "improvements in efficiency and performance in order to stay inline with our peers and develop competitive edges."

Other results:

  • Xarelto: 891 million euros ($1 billion), up 6.8 percent, driven by higher volumes in Europe, Japan and China
  • Eylea: 540 million euros ($625 million), up 17.9 percent, due primarily to expanded volumes in Europe, Japan and Canada
  • Kogenate: 213 million euros ($248 million), down 18.1 percent, after the termination of a distribution agreement with a partner at the end of last year
  • Nexavar: 193 million euros ($224 million), down 15.7 percent, due to increased competitive pressure in the US and Japan
  • Betaferon/Betaseron: 142 million euros ($164 million), down 23.2 percent, mainly due to strong competition in the US
  • Adempas: 89 million euros ($103 million), up 18.7 percent, boosted by positive business development in the US and Europe
  • Xofigo: 89 million euros ($103 million), down 15.2 percent, due to lower volumes in the US, Japan and other countries
  • Stivarga: 82 million euros ($95 million), down 1.2 percent, as US sales came in below the prior-year quarter due to intensified competitive pressure
  • Consumer health sales: 1.4 billion euros ($1.6 billion), down 8.4 percent

Looking ahead:

Bayer reaffirmed its annual sales guidance for the pharmaceutical division, while overall revenue is now expected to be more than 39 billion euros ($45.2 billion). The company previously estimated full-year sales of below 35 billion euros ($40.5 billion), with the increased guidance reflecting more than 5 billion euros ($5.8 billion) attributable to the acquisition of Monsanto business.

However, Bayer noted that earnings for 2018 are now forecast to be lower than previously estimated, with core earnings per share of between 5.70 euros ($6.62) and 5.90 euros ($6.85), below the 6.64 euros ($7.72) per share recorded last year and short of analyst predictions of 6.22 euros ($7.23) per share. The company explained that the change reflects the delayed purchase of Monsanto, with Baumann adding "the acquired business generates the majority of its sales and, above all, earnings in the first half of the year."

The executive noted that although its priority remains reducing debt following the Monsanto takeover, it has funds for more licensing agreements like last year's deal with Loxo Oncology. "If a Loxo (type) opportunity came about we would of course jump on it and we would certainly have the financial means to secure such an asset," Baumann said, adding "we've also talked about stepping up our efforts in business development and licensing in order to complement our own internal R&D efforts."

To read more Top Story articles, click here.