BERLIN: Bayer AG raised its peak sales forecast for its biggest new drugs, signaling optimism for its pharmaceutical unit even as the German conglomerate spends US$66bil to buy US seeds giant Monsanto Co.
A portfolio of five new medicines including anti-clot drug Xarelto and eye medicine Eylea could generate more than 10 billion euros (US$11.2bil) in annual revenue, up from a previous estimate of at least 7.5 billion euros, the Leverkusen-based health-care and crop-science company said in a statement yesterday. Top-seller Xarelto alone is likely to generate more than 5 billion euros a year in sales at its peak.
Crop sciences will probably replace healthcare as Bayer’s biggest business after the Monsanto deal is completed by the end of next year. Funded with a combination of debt and equity, the deal will leave the company little scope for acquisitions to boost its pharmaceuticals business. Bayer emphasized the potential of drugs it already has to drive growth beyond Xarelto, which loses patent protection in 2024.
“We are very confident about our pharmaceuticals business,” chief executive officer Werner Baumann said in the statement. He highlighted the growth potential in Bayer’s pipeline of experimental drugs, saying six medicines currently being tested could generate at least 6 billion euros in annual sales.
Bayer said it’s aiming for average annual sales growth of about 6% for its prescription-drug unit by the end of 2018 with a profit margin of 32% to 34% of revenue that year while over-the-counter drug sales will grow at between 4% and 5. – Bloomberg
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