April 07, 2015
Sales for FY2014 (January-December)

Bayer in Japan continues strong business growth with portfolio transformation underway

  • Bayer Group to focus on Life Sciences
  • Bayer in Japan sales increase by more than 9% to 293,485 million yen in 2014
  • All subgroups contribute to strong year-on-year growth

Tokyo, April 7, 2015 - Bayer Holding Ltd. announced today that Bayer in Japan's FY2014 sales rose by 9.2% to 293,485 million yen. "By further deploying our strategy, we were able to attain this excellent achievement of nearly double-digit growth," commented Hans-Dieter Hausner, President and Senior Bayer Representative for Japan.

HealthCare posted sales of 217,178 million yen, representing an increase of 10.8% year on year. Growth was driven largely by several new and key products including Xarelto and Eylea.

CropScience increased its sales by 2.8% with new product launches to 33,622 million yen while expanding its market share in Japan.

MaterialScience sales were up 6.4% to 42,685 million yen buoyed by the construction industry's growing demand for insulation and building materials.

The staff complement of Bayer in Japan stood at 3,442 employees at the end of 2014.

HealthCare: strong growth in sales driven by new pharmaceutical products

Business in the HealthCare subgroup recorded strong sales growth of 10.8% in Japan to 217,178 million yen, thus achieving double-digit growth for the second year in a row.

The oral anticoagulant Xarelto and the ophthalmological VEGF inhibitor Eylea contributed significantly to this growth. The launch of Adempas (riociguat)*, the first drug therapy for chronic thromboembolic pulmonary hypertension (CTEPH), also supported the subgroup in rejuvenating its product portfolio further. Sales weight of "protected products" (those for which patents remain valid or for which patent reexamination is pending) climbed to over 70%.

Currently 52 Phase II and III clinical trials are lined up in Japan and underscore Bayer's commitment to continue to bring new innovative drugs to the market for the benefit of patients.

In order to jointly pursue further research projects for drug discovery, Bayer established the "Open Innovation Center Japan" in June last year and signed a two-year collaboration agreement with Kyoto University Society-Academia Collaboration for Innovation in September.

In July 2014 the new Consumer Care (CC) organization was launched in Japan and the acquisition of the CC business of Merck &Co.,Inc.,US presents a transformational opportunity for CC in Japan offering an even stronger base upon which to build.

*The development and commercialization of riociguat is part of the worldwide strategic collaboration with Merck (through a subsidiary) in the field of soluble guanylate cyclase (sGC) modulation. Merck is known as MSD outside of the U.S. and Canada.

CropScience: market share gains in crop protection

CropScience continued its business momentum and increased sales in Japan by 2.8% to 33,622 million yen.

CropScience launched in 2014 two new crop protection products in the Japanese market, Bigsure Z a novel herbicide and Evergol Wide, an insecticide / fungicide combination for use in rice. Furthermore, Movento, an insecticide for vegetables, supported the growth of new products.

The Environmental Science business also generated robust sales supported by three successful product launches: the lawn herbicide Esplanade Flowable, the lawn fungicide Interface Flowable and the lawn fungicide Obtain Flowable.

CropScience continues to supply innovative products and high value-added services to farmers for a "Better Life" in order to further develop Japanese agriculture, and thereby provide new solutions for global food supplies.

In 2015, CropScience will implement various global initiatives to raise public awareness in farm management, especially amongst progressive farmers. The two main initiatives, the second "Global Youth Ag-Summit", in which 100 young potentials from 40 countries will be invited to strengthen their leadership in agriculture, and the "YouFarm International", the first-ever global web video competition for farmers.

MaterialScience: solid growth in all business units

MaterialScience sales rose 6.4% to 42,685 million yen in 2014, with all businesses enjoying positive growth momentum due to the booming demand for energy saving applications in the construction market.

During 2014, the headquarter of Sumika Bayer Urethane (SBU) and all Bayer MaterialScience offices in the Kansai area were consolidated into the Innovation Center in Amagasaki, thereby establishing a framework for quick decision-making and closer cooperation.

In March 2014, SBU became the first polyurethane raw material manufacturer in Japan to acquire the JIS (Japanese Industrial Standards) certification, providing Bayer an even stronger position in the growing insulation market.

MaterialScience, including DIC Bayer Polymer's Sakai Plant, has maintained a high safety in all of its operations. As attested by the high level of safety at SBU's Niihama Plant, which set a record of 18 consecutive years of incident-free operations last June, Bayer received the prestigious "Responsible Care" activities award from the Japan Chemical Industry Association.

Transformation into a pure Life Science company and on the path towards further growth in Japan

In 2014, key decisions were taken which will shape the future of the Bayer Group globally for the long term: Bayer announced the acquisition of the consumer care business of Merck & Co., decided to demerge the MaterialScience business and thus initiated the transformation in a pure Life Science company.

The company intends to decide in the second half of this year whether MaterialScience will be floated on the stock market through an IPO or a spin-off. The economic and legal separation - or carve-out - of MaterialScience is planned to be completed by August 31, 2015. Preparations for the carve-out are well on track also in Japan. Together with the support from its joint venture partners, MaterialScience remains strongly committed to the Japanese market.

Bayer in Japan reconfirmed its Growth Strategy which aims at achieving sales of 330 billion yen by 2017 (based on the current portfolio). From 2014 to 2017, Bayer in Japan will spend approximately 60 billion yen in R&D and invest about 10 billion yen in capital expenditures to enable all businesses to continue pursuing innovation and build the foundation for further growth in the years ahead.

Bayer in Japan: Highlights of 2014

Forward-Looking Statements
This press release may contain forward-looking statements based on current assumptions and forecasts made by Bayer Group or subgroup management. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situation, development or performance of the company and the estimates given here. These factors include those discussed in Bayer's public reports which are available on the Bayer website at www.bayer.com. The company assumes no liability whatsoever to update these forward-looking statements or to conform them to future events or developments.