The 2006 financial year was one of the most significant in Bayer's history, according to Werner Wenning, chairman of the board of management, with sales up by 17% and a record operating performance.
Without doubt the highlight of the year was the Euro 17bn acquisition of Schering, while the group's focus was further sharpened by the divestment of the diagnostics business and subsidiaries H.C. Starck and Wolff Walsrode.
The integration of Schering is proceeding apace, Wenning said, with many of the major decisions having been made, including the common operating model, the organisational structure and site-related issues. Last year the Schering business contributed €3.1bn to Bayer Group sales.
In 2006, Bayer Group sales as a whole rose 17%, or €4.3bn, to €29bn. Adjusted for currency fluctuations and portfolio changes, growth amounted to 5%. Strongest growth was achieved in Europe, where business expanded by 17.5% to €12.7bn. Year-on-year sales also rose sharply in Greater China, up by 24% to €1.5bn. Greater China thus moved into third place behind the US and Germany.
Sales of Bayer HealthCare rose by 47% to €11.7bn in 2006, with particularly encouraging figures in Europe and North America. Global sales of the pharmaceuticals segment climbed by 84% to €7.5bn. EBITDA before special items jumped by 76% to €2.6bn. Even without Schering's contribution of €774m, the increase was a very pleasing 24%, said Wenning.
He singled out a number of products that performed particularly well:
- Pro forma sales of the oral contraceptive Yasmin, including YAZ and Yasminelle, advanced by 36%
- Erectile dysfunction treatment Levitra and hemophilia drug Kogenate each saw sales growth of 20%
- Betaferon/Betaseron sales for the treatment of multiple sclerosis expanded by 14% pro forma
- Cancer drug Nexavar posted sales of e130m in the year of its introduction
Besides the Schering acquisition, Wenning emphasised other additions to the Bayer portfolio, including the purchase of the European marketing rights for the blood pressure treatments Pritor and PritorPlus, taking over US-based Metrika in the field of blood glucose measurement, and acquiring the over-the-counter medicines business of the Chinese-based Topsun Group.
The company also entered into a collaboration with US biotech company Regeneron Pharmaceuticals to develop and market a product for the treatment of eye diseases; received marketing authorisation in nearly 50 countries for kidney cancer drug Nexavar; specified the phase III trial programme for thrombosis drug rivaroxaban and began the studies for the chronic indications; and strengthened the potential of Betaferon/Betaseron and the Yasmin product family by expanding their registrations.
In the coming year Bayer aims to grow Group sales by more than 10% (5% when adjusted for the effects of portfolio changes and currency translations), increase underlying EBITDA by more than 10% and slightly improve the EBITDA margin.
'Bayer is not only on a successful course at present, we also see very attractive perspectives for the future,' Wenning concluded.