Bayer pharma earnings fall as R&D spend climbs

Bayer has posted a 1.3% dip in net income for the second quarter to 525 million euros this morning, but the Leverkusen-based firm’s turnover climbed 14.6% to 9.18 billion euros.

Sales at Bayer’s healthcare division were up 6.4% to 4.31 billion euros, while pharmaceutical turover increased 4.3% to 2.63 billion euros. Earnings before interest, taxes, depreciation, and amortizationbefore special items at the latter sector fell 7.3% to 753 million euros, due principally to “higher R&D expenditures in support of our Phase III projects”.

Revenues of Betaferon/Betaseron (interferon beta 1b) for multiple sclerosis fell 10.7% to 302 million euros due to a decline in Europe while the Yaz/Yasmin/Yasminelle (drospirenone and ethinyl estradiol) contraceptive franchise slumped 14.9% to 289 million euros, hurt by a generic of Yaz being launched by Teva Pharmaceutical Industries in the USA last month.

Mirena, the firm’s levonorgestrel-releasing intrauterine contraceptive system, contributed 123 million euros, down 16.2%, while sales of the antibiotic Cipro/Ciprobay (ciprofloxacin) sank 34.6% to 61 million euros.

On the plus side, sales of the haemophilia agent Kogenate (recombinant antihaemophilic factor) jumped 25.2% to 238 million euros, while the antibiotic Avelox (moxifloxacin) climbed 20.8% to 118 million euros. Nexavar (sorafenib), which is approved for liver as well as advanced kidney cancer, contributed 186 million euros, up 19.6%.

Sales of the hypertension treatment Adalat (nifedipine) dipped 0.8% to 177 million euros, and the erectile dysfunction drug Levitra (vardenafil) increased 1.0% to 96 million euros.

Chairman Werner Wenning said he was particularly pleased with the performances of Bayer’s MaterialScience division where sales volumes “have returned to the pre-crisis level” and its consumer healthcare unit. He added that R&D expenses for the full year to come in at a record level of some 3.1 billion euros, up from a previous forecast of 2.9 billion euros.

Bayer said that it now expects pharmaceuticals sales to be flat this year “following the unexpected market entry of a generic competitor to Yaz in the USA”. The company concluded by saying that group sales growth should be more than 5%, while core earnings per share are expected to improve by more than 15%.