Bayer sees peak annual sales of over 10 billion euros from newly launched drugs

Bayer said Tuesday that it is targeting combined peak annual sales from five recently launched drugs, including the anticoagulant Xarelto and the eye treatment Eylea, of more than 10 billion euros ($11.2 billion), up from a prior estimate of at least 7.5 billion euros ($8.4 billion). The company indicated that it also expects to achieve average annual sales growth in its prescription medicines business of approximately 6 percent by the end of 2018.

Specifically, Bayer anticipates that Xarelto, which is partnered with Johnson & Johnson, will generate peak sales in excess of 5 billion euros ($5.6 billion), compared with the 3.5 billion euros ($3.9 billion) previously estimated. For Eylea, which is co-marketed with Regeneron Pharmaceuticals, the company had projected at least 1.5 billion euros ($1.7 billion) in peak sales, but is now forecasting more than 2.5 billion euros ($2.8 billion). Further, Bayer anticipates peak sales potential of more than 1 billion euros ($1.1 billion) for the cancer drug Xofigo and over 500 million euros ($558 million) for the pulmonary hypertension treatment Adempas, while the forecast for its cancer therapy Stivarga remains unchanged, with peak sales potential of at least 1 billion euros ($1.1 billion).

CEO Werner Baumann remarked "we anticipate especially significant sales and margin growth at pharmaceuticals" largely due to "the positive development of our recently launched products." Baumann said Bayer is "also very confident about our pharmaceuticals business beyond these products," adding that "we are planning at least 20 product launches at pharmaceuticals by the end of 2023," including new compounds and expanded indications for already approved drugs.

According to Baumann, Bayer's pipeline includes six product candidates with the potential to generate at least 6 billion euros ($6.7 billion) in combined peak annual revenue. These include anetumab ravtansine for various types of cancer, which Bayer said could garner annual sales of more than 2 billion euros ($2.2 billion), while finerenone for diabetic kidney disease and vilaprisan for the treatment of uterine fibroids, as well as the experimental prostate cancer therapy BAY-1841788, are each anticipated to generate a minimum of 1 billion euros ($1.1 billion). The company also expects that its chronic heart failure drug candidate vericiguat will bring in approximately 500 million euros ($558 million) in peak annual sales, while its investigational lymphoma treatment copanlisib is projected to earn at least that amount.

In addition, Bayer stated that it aims to grow annual sales for its consumer health unit, previously boosted by the 2014 acquisition of Merck & Co.'s consumer care business, by 4 percent to 5 percent by the end of 2018. "At consumer health, we want to concentrate on global brands that occupy leading positions in their respective categories and implement differentiated brand strategies tailored to the respective local markets," Baumann said, adding that the company will focus on critical markets such as the US, Brazil, China and Russia.

Commenting on the news, Jefferies analysts remarked that Bayer's "2018 [earnings] guidance for pharma and animal health may...offer some upside against consensus, though the consumer margin guidance may disappoint slightly." Meanwhile, Warburg analysts said the projections confirmed their "positive expectations." 

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