Meet Management New York 2015
Aug 03, 2015
Meet Management New York 2015
Disclaimer
This presentation 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.
The New Bayer Transforming into a pure Life Science
company
Marijn Dekkers, CEO
• Bayer Investor Presentation • Meet Management • June 2015 Page 1
• Bayer Investor Presentation • Meet Management • June 2015 Page 2
ǀ Transforming into a pure Life Science company and exiting MaterialScience
ǀ Executing a strategy of organic growth complemented by bolt-on acquisitions
ǀ Generating strong growth with new product innovations
ǀ Expecting important R&D pipeline progress during the next 12 – 18 months
ǀ Targeting low single-digit % organic growth and high-teens % improvement in
Core EPS in 2015
The New Bayer
Portfolio Transformation Will Focus
Business and Strengthen Life Sciences
• Bayer Investor Presentation • Meet Management • June 2015 Page 3
Consumer Health
€7.9bn1)
CropScience €9.5bn
Crop Protection #2, Seeds &
Traits
Pharma €12.1bn Leading positions in core
therapeutic areas
A leader in OTC and contrast
media, blood glucose
meters #3/4, Animal Health #5
MaterialScience3) €11.7bn Polyurethanes #1/2, Polycarbonates #1,
Coatings, Adhesives, Specialties, #1
Diabetes Care3)
€0.9bn
Sales 2014
Merck & Co. OTC, Dihon,
€1.6bn pro-forma2)
1) includes €0.3bn from Merck & Co. in Q4 2014
2) FY 2014 pro-forma
3) pending
Page 4
Sales
+5%
Core EPS
Track Record of Consistently Strong
Performance
• Bayer Investor Presentation • Meet Management • June 2015
36.5 35.1
2011 2010 2014 2012 2013
39.8 40.2
42.2
4.83 4.19
2011 2010 2014 2012 2013
5.35 5.61 6.02
CAGR 2010-2014
+9% CAGR 2010-2014
€ billion
€
Page 5
EBIT
€ million
-5%
1,998 2,096
Sales € million
% currency & portfolio adj.
+3%
12,117
10,555
EBITDA before special items
€ million
+10%
3,000 2,738
Core EPS
€
+8%
2.10 1.95
Q1’15 Q1’14 Q1’15 Q1’14 Q1’15 Q1’14 Q1’15 Q1’14
Q1 2015 –
Strong Start to the Year
• Bayer Investor Presentation • Meet Management • June 2015
Q1 2015 – Full-Year Group Guidance Raised
Mainly Due to Fx
Page 6
2014 2015 original guidance
2015 Update (April)
Fx effect
Sales €42.2bn Low-single digit %
increase
~€46bn
Low-single digit %
increase
€48 - 49bn
~ +9%
EBITDA before special
items
€8.8bn Low-to-mid-teens %
increase
High-teens %
increase ~ +8%
Core EPS €6.02 Low-teens %
increase
High-teens %
increase ~ +7%
Sales Δ% Fx and portfolio adj.
Assuming spot Fx rates as of March 31, 2015 for rest of the year
Outlook depends on specific planning assumptions outlined in the Annual Report • Bayer Investor Presentation • Meet Management • June 2015
HealthCare Mid-single-digit % increase Low-twenties % increase (previously: mid-teens %)
Pharma Mid-to high-single-digit % increase Mid-teens % increase (previously: low-teens % increase)
Consumer
Health Mid-single-digit % increase
Mid-thirties % increase (previously: mid- to high-twenties %
increase)
CropScience Low-to mid-single-digit % increase Low-to mid-teens % (previously: low to mid-single digit %)
MaterialScience Lower sales, as volume growth is over
compensated by lower selling prices
Significant increase
CFROI ≥ WACC
Full Year 2015 –
Guidance by Subgroup (Q1 update)
Page 7
*Assuming spot Fx rates as of March 31, 2015 for rest of the year
Sales Δ% Fx & portf. adjusted, EBITDA before special items
Outlook depends on specific planning assumptions outlined in the Annual Report • Bayer Investor Presentation • Meet Management • June 2015
Sales * Adj. EBITDA *
• Bayer Investor Presentation • Meet Management • June 2015 Page 8
4 Key Elements Constitute
Our Successful Strategy
The New Bayer
1. Deliver growth and performance
Fast-Growing Global Pharma Business
Page 10
€ billion; Δ% yoy Fx & portfolio adj.
Sales
10.0 9.9 10.8 11.2
12.1
3.2
2010 2011 2012 2013 2014 Q1 2015
+9%
Maximize the value of launch
products
Drive commercial excellence
in marketing and sales
Advance early and mid-stage
pipeline
Achieve phase III readiness for
key phase II assets by mid-2016
Explore opportunities for
partnerships, open innovation
and bolt-on acquisitions
Plans for
continued growth
+11%
+ 7 %
• Bayer Investor Presentation • Meet Management • June 2015
+1%
+4%
Pharma Launch Products Drive Growth:
Combined Peak Sales Potential of ≥€7.5bn
Page 11 • Bayer Investor Presentation • Meet Management • June 2015
Q1 2015 Individual Sales
482
71
253
€ million
38
54
Total
€898m
€ billion
2012 2013 2014 2015e
0.4
1.5
2.9
Collective Sales
> 4.0
Page 12
Xarelto –
Leading Novel Anticoagulant
Sales € million; Δ% Fx adj.
Global Market Sales Share*
• Continued dynamic growth: gaining 5%-age points market share yoy
and 1%-age point sequentially since year end 2014
• ~13 million patients treated to date
• Comprehensive Life-cycle management program including peripheral artery disease and
chronic heart failure
Peak sales potential of ~€3.5bn reiterated
*Anticoagulant market, as of March 2015
322
949
1,679
482
2012 2013 2014 Q1 2015
+ 38%
33%
12% 13%
Xarelto Pradaxa Eliquis
• Bayer Investor Presentation • Meet Management • June 2015
Eylea –
Gaining Share in Key Markets
Page 13
• Successful roll-out, 2014 sales more than doubled
• Significant label expansion achieved. New indications approved: DME, mCNV and RVO
• Life-cycle management incl. combination therapy with PDGFR-β antibody**
Marketed by Bayer ex-US only
*Sales market share, March 2015
**in collaboration with Regeneron
Japan
55% 46%
2015* 2013
DME: Diabetic macula edema
mCNV: myopic Choroidal neovascularization
RVO retinal vein occlusion
14
333
759
253
2012 2013 2014 Q1 2015
+ 55 %
Sales € million; Δ% Fx adj.
Peak sales potential of ≥ €1.5bn reiterated
• Bayer Investor Presentation • Meet Management • June 2015
Europe 5 main countries + Switzerland
37%
22%
2015* 2013
Merck & Co. Consumer Care / Dihon
Leveraging Potential of OTC Leadership
Strong #2 position
Track record of outperforming
market growth
Success in long-term brand
building
Highly complementary
acquisitions, incl. Merck & Co.
Consumer Care
Globalize established brands
Launch innovation pipeline
Execute Emerging Markets
focus strategies
Fully realize synergy potential
from acquisitions
Target strategic acquisitions
and alliances
Page 14 • Bayer Investor Presentation • Meet Management • June 2015
Plans for
continued growth Achievements Consumer Care Sales
€ billion; 2014 pro forma
2013 2014
€3.9
€5.6
Q1 2015 – Consumer Care:
Generated Strong Growth
Page 15
36%
1,556
• Bayer Investor Presentation • Meet Management • June 2015
Sales
923
1,556*
Q1 2014 Q1 2015
+9%
+9%
+14%
+8%
Performance key brands Δ% yoy, Fx adj.
*including €495m from Merck
€ million; Δ% Fx & portfolio adj.
Delivering Strong Growth in CropScience
6.8 7.3
8.4 8.8
9.5
3.1
2010 2011 2012 2013 2014 Q1 2015
Strengthen portfolio through
focused and integrated crop
solutions
Drive commercial excellence
in marketing and sales
Drive new product growth,
invest in life-cycle management
Expand seeds portfolio by
building business in soybeans
and wheat
€ billion; Δ% Fx & portfolio adj.
Sales
Page 16
Plans for
continued growth
+1%
• Bayer Investor Presentation • Meet Management • June 2015
+11% +9%
+9%
+12%
New Products Drive Growth at
Crop Protection
Page 17
0.4
0.7
1.1
1.5
1.9
~2.8
2010 2011 2012 2013 2014 2017e
New products generated nearly 70% of
absolute sales growth at Crop Protection
€1.9bn
By segment € billion; new CP products launched since 2006; Δ% nominal
New product sales
+23%
Insecticides Herbicides
SeedGrowth Fungicides
• Bayer Investor Presentation • Meet Management • June 2015
2. Develop new growth opportunities
Page 19
2%
MaterialScience
~€0.2bn
HealthCare ~€2.6bn thereof
Pharma
~€2.2bn
Reconciliation
~€0.1bn
66%
27%
5% CropScience
~€1.1bn
• Bayer Investor Presentation • Meet Management • June 2015
R&D 2015e: >€4.0bn +10% yoy
26 successful phase III clinical trials
at Pharma since 2010
Strengthened brands through
multiple line or product
introductions in Consumer Care
Launched 12 active ingredients
between 2006 and 2014 in
CropScience
Initiated R&D projects that leverage
synergies between human, animal
and plant health
Achievements
Confidence in Our R&D Investments
Page 20
Pharma R&D Focus Areas
Cardiology /
Hematology
Oncology
Additional areas incl.
Ophthalmology
Research and Early
Pipeline
Damoctocog alfa pegol
ODM-201
Copanlisib
Finerenone
Vericiguat
Molidustat
Vilaprisan
ISIS-FXIRx
Xarelto (Rivaroxaban)
Eylea (Aflibercept)
Xofigo (Radium-223
dichloride)
Stivarga (Regorafenib)
Adempas (Riociguat)
Life-cycle
Management Mid- and Late-stage
Pipeline Projects
• Bayer Investor Presentation • Meet Management • June 2015
• Bayer Investor Presentation • Meet Management • June 2015 Page 21
Mid- and Late-Stage Pharma Pipeline
Progressing – Current Timelines
CHF: Chronic heart failure; CRPC: Castration-resistant prostate cancer;
NHL: Non-Hodgkin‘s lymphoma; r/pEF: Reduced/preserved ejection fraction
Damoctocog alfa pegol
Hemophilia A
ODM-201
CRPC
Copanlisib
Cancer; NHL
Finerenone
Worsening CHF
Diabetic nephropathy
Vericiguat
Worsening CHF rEF
Worsening CHF pEF
Molidustat
Renal anemia
Vilaprisan
Uterine fibroids
Endometriosis
Phase III (pediatric)
Phase III
Phase IIa
Phase III
Phase IIb
Phase IIb
Phase IIb
Phase IIb
Phase IIb
2016 2015 2014
Phase IIb
Phase IIb
Phase IIa
PH III decision
PH III decision
PH III decision
PH III decision
PH III decision
reported
CropScience Innovation Pipeline 2014-2019
with Combined Peak Sales Potential > €5bn
• Bayer Investor Presentation • Meet Management • June 2015 Page 22
New launches Planned launches*
2014 2015 2016 2017 2018 2019 Verango/Velum
Nematicide
Sivanto
Insecticide
Disease control
New mixture /
formulation
Pest control
New active
ingredient
Weed control
New mixture /
formulation
Pest control
New active
ingredient
Flocter
Biological
nematicide
Council
Rice herbicide
Disease control
Country / label
extension
Disease control
Country / label
extension
Weed control
New mixture /
formulation
Disease control
New active
ingredient
FiberMax
GlyTol + TwinLink
cotton
Movento
Country / label
extension
Weed control
Country / label
extension
Weed control
Country / label
extension
Disease control
New mixture /
formulation
InVigor
Canola pod shatter
reduction
Alion
Country / label
extension
Oilseeds
Improved canola oil
profile
Cotton
Dual HT + IR
Soybeans
Triple HT
Arize
Bacterial Leaf
Blight resistant rice
Wheat
Non-hybrid wheat
seed (Ukraine)
Oilseeds
Dual HT canola
Oilseeds
Dual HT canola
Soybeans
Dual HT
Rice
Insect resistance +
disease resistance
Oilseeds
HT Ogura hybrid
Rice
Disease resistance
+ salinity tolerance
Rice
Disease tolerance
Rice
Disease resistance
+ submergence tol.
Soybeans
Dual HT
*subject to regulatory approval
**includes selected native traits
Major Life Cycle Innovation
Chemical Crop Protection
Biological Crop Protection
Seeds & Traits**
HT: Herbicide tolerance trait
IR: Insect resistance trait
More than 100 Life Cycle Management projects
Several hundred new varieties in vegetables and broad acre crops
• Bayer Investor Presentation • Meet Management • June 2015 Page 23
Trend-setting Research in the Fields of
Human, Animal and Plant Health
Related challenges for human, animal and plant health* Potential for collaboration & synergies
Host-
microbe
interaction
Resistance
control
Unregulated
growth
*Examples
HealthCare
R&D
CropScience
R&D
Knowledge Platforms
(ie. genomics etc.)
Molecular Target
(ie. ion channels etc.)
Common Mechanisms
(ie. protein modification etc.)
Technology Platforms
(ie. HTS etc.)
Preclinical Evaluation
(ie. Toxicology etc.)
New Molecular Entities
(ie. NCE/NBE)
3. Execute Portfolio Transformation • Integrate acquired businesses
• Exit MaterialScience businesses
• Adjust Group structures to reflect Life Science
focus
Transforming Into a Pure Life Science Company
Transaction Volume >€48bn Since 2004*
2003 Sales €28.6bn
HealthCare
CropScience
MaterialScience
Chemicals
Major examples only
Pro-Forma 2014 Sales ~ €31bn
CropScience
HealthCare Divestitures
€12bn
Acquisitions
€36bn
Diagnostics
Plasma
Diabetes Care**
–
+
+
+
Merck & Co. Consumer Care
Dihon
Algeta
Conceptus
Steigerwald GmbH
Schering AG
Roche OTC
+
+
+
+
AgraQuest
Athenix
Stoneville Cotton Seed
Gustafson Seed Treatment +
+
+
+
Capital-market
exit planned
*Transaction volume: acquisitions/divestments 2004 – 2014
**pending
–
–
Lanxess spin-off
Bayer Silicones
–
–
–
–
• Bayer Investor Presentation • Meet Management • June 2015 Page 25
HC Starck
Wolff Walsrode
Divested
Divested
–
Life Science Transformation on Track
Page 26
Exit of
Diabetes Care
Divestment for total
consideration of ~€1,022m
Closing expected in
Q1 2016
LS: Life Sciences
Demerger of
MaterialScience
Targeted time frame
for capital-market exit:
latest mid-2016
Timing, structure and
exit options depend
on market
environment;
decision 2H 2015e
Potential proceeds re-
invested in the
business/
reduction of net debt
Merck Consumer Care
Integration
Integration progressing
as planned
Synergy tracking and
integration teams in
place
Confirmed 2017
synergy targets:
• USD400m top-line
• USD200m cost-
synergies by 2017
• Bayer Investor Presentation • Meet Management • June 2015
4. Delever balance sheet and use
cash efficiently
CapEx budget 2015 ~€2.3bn PP&E
R&D 2015e: >€4.0bn
Efficient Use of Cash
Fuel organic growth
M&A
Dividend policy
Pay down debt
• Bayer Investor Presentation • Meet Management • June 2015 Page 28
Organic growth complemented by bolt-on
acquisitions
Maintaining single-A credit rating category
Potential proceeds from MaterialScience exit
and Diabetes Care divestment
Pay out 30-40% of core EPS
Summary
The New Bayer – A World-Class
Life Science Company
Page 30
• Fast-growing global pharma business
• Leveraging potential of OTC leadership
• Gaining market share in CropScience
• Progressing innovation pipeline
• Setting trends in research-intensive areas in the field
of human, animal and plant health
• Leveraging sales growth into value creation
• Excellence in R&D and commercialization
• Leveraging leading brands with decade-long brand equity
• Superior emerging-market presence
Performance
Capabilities
Value
• Bayer Investor Presentation • Meet Management • June 2015
• Bayer Investor Presentation • Meet Management • June 2015 Page 31
Progress of Cardiovascular Pipeline in 2015
Joerg Moeller, Head of Global Development Bayer HealthCare
• Bayer Investor Presentation • Meet Management • June 2015 Page 32
Heart Failure –
A Common and Potentially Fatal Condition
● Heart failure (HF) has a high prevalence and a growing incidence
● ~ 26 million people with HF worldwide
● 600,000 new HF cases per year in Europe
● 500,000 new HF cases per year in the US
● ~ 6 million Americans suffer from HF
● 1 in 5 HF patients die within 1 year
Ref: http://www.medicographia.com/2012/02/the-heart-failure-epidemic
• Bayer Investor Presentation • Meet Management • June 2015 Page 33
Heart Failure –
A Heterogenous Condition
Forms of Heart Failure
1:McMurray et al. ESC HF Guidelines 2012. Eur Heart J 2012;33(14):1787-847 2:according to ACC/AHA (stage of HF based on structure
and damage to heart muscle) and NYHA (severity based on symptoms and physical activity; MRA: mineralocorticoid receptor antagonist
ACE: angiotensin-converting-enzyme; ARB: angiotensin receptor blocker; ACC/AHA: American College of Cardiology Foundation/American
Heart Association; NYHA: New York Heart Association
Form “systolic” HF =
HF due to reduced
ejection fraction
(HFrEF)
“diastolic” HF =
HF with
preserved
ejection fraction
(HFpEF)
Therapies Multiple,therapies available incl. MRAs,
ARBs, ACE, MRAs; beta blocker etc.
No treatment available to reduce
morbidity and mortality1
● Further classification includes duration / change in symptoms2
● 2 general forms can be distinguished:
• Bayer Investor Presentation • Meet Management • June 2015 Page 34
High Unmet Medical Need Persisting
in Both HFrEF and HFpEF
CHF: chronic heart failure
HFrEF: heart failure with reduced ejection fraction
HFpEF: HF with preserved EF
1:Oktay et al. Curr Heart Fail Rep (2013) 10:401–410 Steinberg et al. Circulation. (2012)126(1):65-75; 2:Fonarowet al.. JACC (2007) 50:768 ff
HFpEF passes HFrEF as cause of
hospitalizations1
HFpEF prognosis is as bad
as HFrEF after hospitalization2
R&D pipeline is addressing both forms, HFrEF and HFpEF with
innovative mechanisms and molecules.
50% EF > 50%; 35% EF < 40%; 15% EF 40 - 50%
OPTIMIZE-HF registry
HFrEF HFpEF
Postdischarge event rates at 60-90d (%)
Mortality 9.8 9.5
Mortality
and/or
re-hospitalization
36.1 35.3
• Bayer Investor Presentation • Meet Management • June 2015 Page 35
Mid- and Late-Stage Pharma Pipeline
Progressing – Current Timelines
Damoctocog alfa pegol
Hemophilia A
ODM-201
CRPC
Copanlisib
Cancer; NHL
Finerenone
Worsening CHF
Diabetic nephropathy
Vericiguat
Worsening CHF rEF
Worsening CHF pEF
Molidustat
Renal anemia
Vilaprisan
Uterine fibroids
Endometriosis
Phase III (pediatric)
Phase III
Phase IIa
Phase III
Phase IIb
Phase IIb
Phase IIb
Phase IIb
Phase IIb
2016 2015 2014
Phase IIb
Phase IIb
Phase IIa
PH III decision
PH III decision
PH III decision
PH III decision
PH III decision
reported
CHF: Chronic heart failure; CRPC: Castration-resistant prostate cancer
NHL: Non-Hodgkin‘s lymphoma; r/pEF: Reduced/preserved ejection fraction
• Bayer Investor Presentation • Meet Management • June 2015 Page 36
Vericiguat
• Bayer Investor Presentation • Meet Management • June 2015
Vericiguat –
Targeting HFrEF and HFpEF
Page 37
● Vericiguat is a novel sGC stimulator targeting to stimulate cGMP
generation which is hampered in both forms of HF, HFrEF and
HFpEF
● SOCRATES phase IIb program covers two parallel trials in CHF
patients with reduced or preserved ejection fraction
1. HFrEF: SOCRATES-REDUCED phase IIb program:
● First data planned to be presented at AHA,
November, 2015
2. HFpEF: SOCRATES-PRESERVED phase IIb program:
● First data planned to be presented at a scientific
congress 1H 2016
HFrEF: heart failure with reduced ejection fraction; HFpEF: HF with preserved EF
sGC: soluble guanylate cyclase; CHF: chronic heart failure; EF: ejection fraction; cGMP:
cyclic guanosine monophosphate; NO, nitric oxide; CHF: chronic heart failure
• Bayer Investor Presentation • Meet Management • June 2015 Page 38
● For CHF patients requiring
hospitalization or iv diuretic
treatment, outcomes remain
exceptionally poor
● For HF with preserved EF, no
evidence-based therapies exist
● cGMP pathway modulation is a
potential therapeutic target in
HFrEF and HFpEF
cGMP, cyclic guanosine monophosphate; eNOS, endothelial nitric oxide
synthase; GTP, guanosine triphosphate; NO, nitric oxide; sGC, soluble
guanylate cyclase
CHF:chronic heart failure; iv: intravenous, HF: heart failure
EF: ejection fraction; HFrEF: HF with reduced EF; HFpEF: HF with
preserved EF
sGC role in heart failure Vericiguat - mode of action
sGC-Stimulation – Potentially New
Approach for Heart Failure Treatment
sGC-Stimulation – Rationale for Exploration in HFrEF and HFpEF
• Bayer Investor Presentation • Meet Management • June 2015 Page 39
1. Similar mechanism of myocardial remodeling in HFrEF and
advanced HFpEF1
2. Phase II study in patients with PH-sLVD and HF (LEPHT)2
• Although the primary end point of the study was not met, Riociguat
was well tolerated in patients with PH-sLVD and HF and improved
cardiac index and pulmonary and systemic vascular resistance
3. Phase II study in patients with HFpEF (DILATE-1)3
• Riociguat was well tolerated, had no significant effect on mPAP, and
improved exploratory hemodynamic and echocardiographic
parameters
PH-sLVD: PH systolic left ventricular dysfunction; HF: heart failure; HFpEF: HF with
preserved ejection fraction (EF); HFrEF: HF reduced EF; mPAP: mean pulmonary
arterial pressure
Ref: 1. Bonderman et al Circulation. 2013 ;128(5):502-11.; 2. Bonderman et al. Chest. 2014 146(5):1274-85
• Bayer Investor Presentation • Meet Management • June 2015 Page 40
The SOCRATES Phase IIb in Worsening
Chronic Heart Failure - Study Design
Design 2 randomized parallel-group, placebo-controlled, double-blind,
dose finding phase IIb studies of 4 dose regimens (1.25 – 10 mg)
of the oral sGC stimulator Vericiguat over 12 weeks
Inclusion
criteria
Worsening chronic heart failure requiring hospitalization
(or IV diuretic for HF) with initiation after clinical stabilization
LVEF < 45% (HFrEF) LVEF ≥ 45% (HFpEF)
Left atrial (LA) enlargement
Primary
outcome NT-proBNP at 12 weeks NT-proBNP / LAV at 12 weeks
Secondary
outcomes
Secondary endpoints include clinical outcomes (cardiovascular death; recurrent
hospitalization for worsening heart failure etc.)
Sample size 410 patients in 5 arms 470 patients in 5 arms
sGC: soluble guanylate cyclase; LVEF: left ventricular ejection fraction; NT-proBNP:
N-terminal of the prohormone brain natriuretic peptide; LAV: left atrial volume
HFpEF: heart failure with preserved ejection fraction; HFrEF: HF reduced EF
• Bayer Investor Presentation • Meet Management • June 2015 Page 41
Finerenone
• Bayer Investor Presentation • Meet Management • June 2015
Finerenone – Developed as a Potential
New Treatment Option for HF and DKD
Page 42
● MRAs are an established therapeutic option in HFrEF, but underutilized due to their side effect profile
● Finerenone is a differentiated MRA currently developed in two indications:
1. Chronic Heart Failure
● Phase IIb (ARTS-HF and ARTS-HF Japan) completed
● Data presentation planned for ESC, Aug 29-Sept 2, 2015
2. Diabetic Kidney Disease
● Phase IIb (ARTS-DN) met primary endpoint of reducing a surrogate marker for kidney function
● Phase III preparation under way – initiation of phase III 2H 2015e
HF: heart failure, DKD diabetic kidney disease; MRA: mineralocorticoid
receptor antagonist; HFrEF: heart failure with reduced ejection fraction
Benefit in pivotal studies in HFpEF not
established
MRAs are approved in HFrEF
● Benefit in patients with HFrEF
demonstrated in clinical studies
MR-Blockade is a Proven Principle in the
Treatment of Heart Diseases
• Bayer Investor Presentation • Meet Management • June 2015 Page 43
● MRAs are underutilized
● Approved MRAs have a risk to
cause
● Hyperkalaemia,
● Renal dysfunction and
● Anti-androgenic / progestogenic
side effects
MRA: mineralocorticoid receptor antagonist;HFrEF: heart failure with reduced ejection fraction
HFpEF: HF with preserved ejection fraction; 1: NEJM 1999 341, 709ff
2. NEJM 2003;348:1309ff; 3 NEJM 2011;364:11ff
Study / N Drug Total mortality HR (p value)
RALES1
N= 1,663
Spironolactone 38.1% vs 50.5% 0.68
(<0.001)
EPHESUS2
N=6,642
Eplerenone 26.6% vs 30.0% 0.87 (0.002)
EMPHASIS3
N=2,737
Eplerenone 18.3% vs 25.9% 0.63
(<0.001)
Steroidal MR antagonists are not
approved for kidney diseases
Use of approved MRAs limited
• Bayer Investor Presentation • Meet Management • June 2015
Finerenone –
Differentiated Profile Amongst MRAs
Page 44
Finerenone - Profile Summary* Finerenone - Data
At least as potent as Spironolactone
and as selective as Eplerenone (based
on in vitro data**)
● Lower incidence of hyperkalaemia vs. spironolactone
● Lower incidence of worsening of renal function
● Decreased BNP/NT-proBNP – a key parameter for
cardiac stress
At least similar efficacy and
improved safety vs. Spironolactone
(based on phase IIa (ARTS) data***)
Non-steroidal structure
(Eplerenone and Spironolactone are
steroids)
N
NH
N
O
OO
NH2
O
O
O
O
O
O
Spironolactone Eplerenone Finerenone
O
S
O
O
O
H
H H
MRA: mineralocorticoid receptor antagonist; *based on published data as of June 2015
**Pitt B Eur J Heart Fail. 2012 Jun;14(6):668-75
*** Pitt B et al. European Heart Journal (2013) 34, 2453-63
• Bayer Investor Presentation • Meet Management • June 2015
Phase IIb in Worsening Chronic Heart
Failure (ARTS-HF) – Study Design
Page 45
Primary efficacy endpoint: patients with decrease in NT-proBNP > 30% (baseline to visit 9 [day 90])
Further exploratory efficacy variables include: all-cause death; CV death etc.
Details on study design at: Pitt et al European Journal of Heart Failure (2015) 17, 224–232
• Bayer Investor Presentation • Meet Management • June 2015
Rationale for Developing Finerenone in Diabetic Kidney Disease
Page 46 MRA: MR antagonist ; HF: heart failure; CKD: chronic kidney disease; CV: cardiovascular
UACR: urine albumine-creatinine ratio; AEs: adverse events: SAE: severe AEs
1: United States Renal Data System 2012
● ~29 million people with diabetes in the US (9.3% of the population)
● Diabetes causes 44% of new cases of kidney failure
● > 35% of people > 20 years of age develop diabetes “diabetic”
kidney disease (DKD)
● Cardiovascular (CV) mortality dominates CKD with 45% of deaths1
Significant need for innovative therapies
The mineralocorticoid receptor (MR) is a link between HF,
diabetes and CKD
MRAs may prevent massive pathophysiological effects of an over-activated MR
• Bayer Investor Presentation • Meet Management • June 2015
Finerenone – Phase IIb (ARTS-DN) in Diabetic Nephropathy Met Endpoint
Page 47 UACR: urine albumine-creatinine ratio
AEs: adverse events: SAE: severe AEs; 1: United States Renal Data System 2012
● Study met primary endpoint - Finerenone dose-dependently
decreased UACR - a surrogate marker for kidney function/disease
● All doses studied were safe and well tolerated
● Incidence of treatment-emergent AEs and SAEs were comparable
to placebo
● Low incidence of confirmed hyperkalemia
(serum potassium ≥ 5.6 mmol)
Phase III is currently under preparation
Initial phase IIb data in diabetic nephropathy:
• Bayer Investor Presentation • Meet Management • June 2015
Finerenone – Potential to Improve Treatment
Standard in Cardio/Renal Diseases
Page 48
MR(A): mineralocorticoid receptor (antagonist)
CHF: chronic heart failure HFrEF: heart failure with
reduced ejection fraction;: DKD: diabetic kidney disease
DKD
● Finerenone targeted
to be first-in-class
● No MRA marketed
CHF (HFrEF)
● Finerenone targeted
to be best-in-class
● May overcome low
use of marketed
steroidal MRAs*
1 based on published information as of May 11, 2015; * Although 1A recommendation in treatment guidelines, only about 32% of eligible pts
receive MRAs in the US (Krantz at al, Am J. Cardiology 2011, 107: 1818-23)
Finerenone
● Differentiated profile
vs marketed MRAs1
● Balanced renal/cardiac
activity and electrolyte
vs. anti-remodelling
effects
N
NH
N
O
OO
NH2
• Bayer Investor Presentation • Meet Management • June 2015 Page 49
Molidustat
• Bayer Investor Presentation • Meet Management • June 2015
Molidustat –
Targeting Treatment of Renal Anemia
Page 50
● The HIF stabilizer Molidustat is a potent oral EPO-inducer
currently in phase IIb for treatment of renal anemia
● Molidustat is a “hypoxia mimetic” with high selectivity of the
induction of EPO-gene expression
● Favorable PK/PD, toxicology and safety profile - once daily
dosing efficient in inducing endogenous EPO within physiological
range
● No hypertension signals - may be add-on benefit for CKD
patients
● Phase IIb data expected 1H 2016e
HIF: hypoxia-inducible factor; CKD: chronic kidney disease; EPO: Erythropoietin
PK/PD: pharmacokinetic/pharmacodynamic
Page 51
Renal Anemia – Pathophysiology,
Epidemiology and Treatment
EPO: Erythropoietin; CKD: chronic kidney disease; 1: estimate - US, Japan
and EU5 countries combined 2.Ref: Decision Resources, 2013, estimate
- refers to time 2012-2022; ESA: erythropoietin stimulating agents
● In CKD patients, kidneys do not produce enough EPO to stimulate sufficient red blood cell production - patients become anemic
● Estimated prevalence of CKD in adult population: ~13%
● ~7 million renal anemia patients1
● ESA including EPO have a share of ~70% amongst CKD therapies2
● EPO has to be given parenteral
unphysiologically high peak levels may be associated with hypertension, increased CV events and mortality
restriction in usage
• Bayer Investor Presentation • Meet Management • June 2015
• Bayer Investor Presentation • Meet Management • June 2015
Molidustat –
Design of the Phase IIb Program "Dialogue"*
Page 52
04 / 2014
Ph IIb – Dialogue Program
Maintenance / Titration / 4 months
N = 120 CKD on Darbepoetin alfa / 3 start doses: 25, 50, 75 mg OD vs Darbepoetin alfa
Maintenance / Titration / 4 months
N = 188 ESRD on EPO / 4 start doses: 25, 50, 75, 150 mg OD vs EPO
Fixed Dose / 4 months Treatm. N = 120 naive CKD pts / 25, 50, 75 mg OD & 25, 50 bid vs placebo
FPFV
10 / 2013
Long-term Extension
Long-term Extension
* Daily oral treatment increasing endogenous erythopoietin
CKD: chronic kidney disease; EPO: Erythropoietin; OD: once a day, bid: twice
a day; eGFR: estimated glomerular filtration rate
Dia
lysis
P
re-d
ialy
sis
Primary outcome: change in local laboratory hemoglobin level (baseline to the average
during the last 4 weeks treatment period)
Secondary outcomes include: safety, mean of the hemoglobin (Hb) levels in the target
range (10.0 to 11.0 g/dL), etc..
• Bayer Investor Presentation • Meet Management • June 2015 Page 53
Summary
• Bayer Investor Presentation • Meet Management • June 2015
Summary –
Cardiovascular Pipeline Progress
Page 54
● Mid-stage cardiovascular pipeline progressing
● Bayer’s pipeline is uniquely positioned to address unmet
medical need in heart failure and kidney diseases
● Multiple decision points on potential phase III transitions
expected 2H 2015 and 1H 2016
• Bayer Investor Presentation • Meet Management • June 2015
Expected Major Newsflow from
the Pharma Pipeline
Page 55
Regorafenib Multikinase inhibitor
Wet AMD (eye drops) • Phase II completion 1H 2016e Congress 2016e
Finerenone Mineralocorticoid receptor antagonist
Chronic heart failure • Phase IIb; completed ESC Aug/Sept 2015e
Copanlisib PI3 kinase inhibitor
Non-Hodgkin’s lymphoma • Phase II completion 1H 2016e Congress 2016e
Vericiguat sGC stimulator
Wors. chronic heart failure • Phase IIb; reduced ejection
fraction - compl. mid 2015e AHA Nov 2015e
• Phase IIb; preserved ejection
fraction - compl. end 2015e
ODM-201 Androgen receptor antagonist
Non-metastatic castration-
resistant prostate cancer • Phase III completion 2018e tbd
Asset Intended Indication Status /
Expected Completion
Milestone / Data
Presentation* Targeted
Molidustat HIF-PH inhibitor
Anemia • Phase II completion 1H 2016e Congress 2016e
Vericiguat sGC stimulator
Wors. chronic heart failure Congress 2016e
Vilaprisan Selective progesterone
receptor modulator
Uterine fibroids • Phase IIb; completion 1H 2016e Congress 2016e
Regorafenib Multikinase inhibitor
HCC (2nd line) • Phase III completion 1H 2016e Congress 2016e
AMD: age-related macular degeneration; HCC: hepatocellular carcinoma
HealthCare
Page 56 • Bayer Investor Presentation • Meet Management • June 2015
Leading Positions in Key Healthcare
Markets
• Bayer Investor Presentation • Meet Management • June 2015 Page 57
Pharma
€12,052m
Leading positions in key therapeutic categories
Consumer Care
€4,245m
Global #2 in OTC-pharmaceuticals
Medical Care
€2,360m #1 in fluid injection systems, #1 in contrast
media, #3/4 in blood glucose meters
Animal Health
€1,318m
Global #5, #2 in parasiticides
Sales by Segment 2014
25%
60%
7%
21%
12%
HealthCare €19,975m
Consum
er
Health
Rx
FY 2014 – Dynamic Growth of HealthCare
Driven by Pharma
Page 58
Pharma
+8% (+11%)
Consumer
Health
+2% (+2%)
36%
HealthCare €19,975m; +6% (+8%)
12,052 7,923
Price
+1%
Volume
+6%
Fx
-4%
Portfolio
2%
€ million; Δ% yoy, () = Fx & portfolio adj.
FY‘13 FY‘14 FY‘13 FY‘14
5,334 5,484 +3%
3,973 3,912 -2%
Adj.
EBITDA
Adj.
EBIT
• Bayer Investor Presentation • Meet Management • June 2015
Earnings Sales
1,844 1,785
3,699 3,490 +6%
-3%
2,552 2,657
1,255 1,421
+4%
-12%
before special items, € million; Δ% yoy
FY 2014 – Top 10 HealthCare Products
• Bayer Investor Presentation • Meet Management • June 2015 Page 59 MI: Myocardial infarction
1,679
1,109
819
773
927
759
819
768
658
588
Anticoagulation
Hemophilia A
Multiple Sclerosis
Contraception
Cancer
Blood Glucose Meter
Contraception
Analgesic & sec.
MI Prevention
Ophthalmology
Hypertension
+82%
-6%
+5%
-20%
+15%
+4%
-3%
+133%
-8%
+2%
€ million; Δ% Fx adj.
Sales
FY 2014 – Strong Business Momentum in
All Regions, Especially Emerging Markets
• Bayer Investor Presentation • Meet Management • June 2015
Emerging Economies
25%
HealthCare Sales
Latin
America
Eastern
Europe
Africa &
Middle East
~2,450
+12%
~1,930
+14%
~1,230 ~890
+8%
24%
USA
+6%
30%
33%
13%
€ million; Δ% Fx adj.
Emerging
Economies¹
+13%
Emerging
Asia³
Western
Europe +8%
Others²
+10%
€19,975m; +6% (+8%)
Page 60
+16%
€ million; Δ% Fx adj.
¹ Emerging economies include: Latin America, Asia w/o Japan, Australia,
New Zealand, Africa and Middle East incl. Turkey, Eastern Europe
² Others = Japan, Australia, New Zealand, Canada
³ Emerging Asia = Asia w/o Japan, Australia, New Zealand
Q1 2015 – HealthCare:
All Divisions Generated Strong Growth
Page 61 • Bayer Investor Presentation • Meet Management • June 2015
Pharma
+15% (+7%)
Consumer
Health
42% (+7%)
36%
HealthCare €5,742m; +26% (+7%)
3,200 2,542
Price
1%
Volume
+7%
Fx
+8%
Portfolio
+11% Q1‘14 Q1‘15
873 988
428 627
+13%
+46%
1,301
1,615 +24%
321 +46%
946
1,185 +25%
625
470
715
+14%
Sales € million; Δ% yoy, () = Fx & portfolio adj.
Earnings
Q1‘14 Q1‘15
before special items, € million; Δ% yoy
Adj.
EBITDA
Adj.
EBIT
Q1 2015 – Pharma:
Launch Products Drove Growth
Page 62 • Bayer Investor Presentation • Meet Management • June 2015
Launch products
Pharmaceuticals €3,200m; +15% (+7%)
898
Q1‘14 Q1‘15 Q1‘14 Q1‘15
873
988 +13%
625
715
+14%
Sales € million; Δ% yoy, () = Fx & portfolio adj.
Earnings before special items, € million; Δ% yoy
Adj.
EBITDA
Adj.
EBIT
Q1 2015 – Consumer Health:
All Businesses with Strong Growth
Page 63 • Bayer Investor Presentation • Meet Management • June 2015
Medical Care
+12% (+6%)
Consumer
Care
+69% (+8%)
36%
Consumer Health €2,542m; +42% (+7%)
600
1,556
Q1‘14 Q1‘15 Q1‘14 Q1‘15
428
627 +46%
321
+46% 470
Animal Health
+17 (+6%)
386
Sales € million; Δ% yoy, () = Fx & portfolio adj.
Earnings before special items, € million; Δ% yoy
Adj.
EBITDA
Adj.
EBIT
HealthCare:
2015 Financial Outlook (Q1 Update)
Page 64
Sales Δ% Fx & portfolio adj.
• Bayer Investor Presentation • Meet Management • June 2015 *Assuming spot Fx rates as of March 31, 2015 for rest of the year
Outlook depends on specific planning assumptions outlined in the Annual Report
HealthCare Mid-single-digit % increase (Fx +9%)
Low-twenties % increase
Pharma Mid-to-high-single-digit % increase (Fx +9%)
Launch product sales: above €4bn
Mid-teens % increase
Margin slightly below prior year
Consumer
Health Mid-single-digit % increase (Fx +9%)
Mid-thirties % increase
Sales* EBITDA before special items*
Pharma Launch
Products
Commercial Excellence at Pharma
Page 66 • Bayer Investor Presentation • Meet Management • June 2015
Absolute product sales increase/decline FY 2014 yoy, Fx adj.
Δ% Fx & portfolio adj.
+€1,668m
-€364m Growth
Decline
+€1,298m
Pharma
overall
Xarelto
Eylea
Xofigo
Mirena family
Adempas
Aspirin Cardio
Stivarga
Nexavar
other
Betaseron
Kogenate
Levitra
Avelox
YAZ family
other
+11%
Pharma Launch Products Drive Growth:
Combined Peak Sales Potential of ≥€7.5bn
€ billion
FY 2014 Individual Sales
2010 2011 2012 2013 2014 2015e
0.1
1,679
224
759
€ million
0.1 0.4
1.5
2.9
89
157
Total
€2.9bn
Page 67 • Bayer Investor Presentation • Meet Management • June 2015
Collective Sales
> 4.0
Xarelto: The Leading Novel Oral
Anticoagulant
Page 68 • Bayer Investor Presentation • Meet Management • June 2015
Sales Achievements
Continued dynamic growth
Clear market share lead among novel
oral anticoagulants:
Xarelto: ~33%
Pradaxa: ~12%
Eliquis: ~13%
(Global anticoagulant market, sales share, March, 2015)
~13 million patients treated to date
Comprehensive global life-cycle-
management program in place
Label expansion: recommendend for
cardioversion in A‘fib-patients in
Europe
Approved for SPAF and for treatment
of DVT in China
86
322
949
1,679
482
2011 2012 2013 2014 Q1 '15
+ 38 %
€ million; Δ% yoy Fx adj.
Eylea: Label Expansion to Support Further
Growth
Page 69 • Bayer Investor Presentation • Meet Management • June 2015
Sales Achievements
Strong growth driven by continued
roll-out activities
Label expansion since mid 2014
including:
DME Europe & Japan
mCNV Japan
RVO Europe
Positive data from NIH/DRCR
sponsored study comparing Eylea,
Avastin and Lucentis in DME1
Agreement with Regeneron to
develop a coformulation of Eylea and
a PDGFR-β antibody for treatment of
wAMD
DME: Diabetic macular edema, BRVO: Branched retinal vein occlusion, mCNV: Myopic choroidal
neovascularization, wAMD: Wet age-related macula degeneration NIH: National Institutes of Health, DCRC:
Diabetic Retinopathy Clincial Research Network, RVO: Retinal vein occlusion;
PDGFR: Platelet derived growth factor receptor
1) NEJM February 18, 2015 DOI: 10.1056/NEJMoa1414264
14
333
759
253
2011 2012 2013 2014 Q1 '15
€ million; Δ% yoy Fx adj.
+ 55 %
Xofigo: Significant Growth Expected
• Bayer Investor Presentation • Meet Management • June 2015 Page 70
Achievements
Launch activities ongoing
Approved in 42 countries1
Launched in 30 countries1
Targeting >€300m sales in 2015
Life-cycle management program
targeting label expansions in CRPC
and additional cancer indications
underway
CRPC: Castration resistant prostate cancer
1) As of April 2015
41
157
54
2012 2013 2014 Q1 '15
Sales € million; Δ% yoy Fx adj.
+ 28 %
Stivarga: Leading 3L+ Treatment of
Metastatic Colorectal Cancer
Page 71 • Bayer Investor Presentation • Meet Management • June 2015
Achievements
Most prescribed agent in 3rd-line
plus treatment of mCRC in the US
and in Japan
Roll-out activities in mCRC and GIST
continuing
Targeting increased use in 3L-
treatment of mCRC
~45,000 patients treated to date
mCRC: Metastatic colorectal cancer; GIST: Gastrointestinal stromal tumor
32
197
224
71
2011 2012 2013 2014 Q1 '15
Sales € million; Δ% yoy Fx adj.
+ 14 %
Adempas: Encouraging Early Launch
Experience
Page 72 • Bayer Investor Presentation • Meet Management • June 2015
Achievements
Launched in PAH and CTEPH in first
countries
~4,300 patients treated to date2
Life-cycle management trials in
systemic sclerosis, cystic fibrosis and
in PH associated with idiopathic
interstitial pneumonias initiated
Agreement with Merck & Co. for joint
development and commercialization
of sGC-modulators in place
1) as of end of May 2015; 2) as of May 2015, PH: Pulmonary hypertension
PAH: Pulmonary arterial hypertension, CTEPH: Chronic thrombo-embolic pulmonary
hypertension, sGC: Soluble guanylate cyclase
PAH CTEPH
Approved1 53 53
Launched1 29 30
9
23 26
31
38
Sales € million
Q1 ‘14 Q2 ‘14 Q3 ‘14 Q4 ‘14 Q1 ‘15
Pharma-
Pipeline
• Bayer Investor Presentation • Meet Management • June 2015 Page 74
Increased R&D Investment to Support
Pharma Innovation
Support maturing mid-stage pipeline
Phase III for Copanlisib initiated
Achieve phase III readiness for
Finerenone and Vericiguat in 2015
Achieve phase III readiness for
Molidustat and Vilaprisan in 2016
Enhance research capabilities /
technologies etc.
Advance / build early pipeline
Support life-cycle management
activities for recently launched
products
2014
2015e
~350m 1.9 2.2
Pharma R&D expense 2014
& Budget 2015e € billion
• Bayer Investor Presentation • Meet Management • June 2015 Page 75
Pharma R&D Focus Areas
Cardiology /
Hematology
Oncology
Additional areas incl.
Ophthalmology
Research and Early
Pipeline
Damoctocog alfa pegol
ODM-201
Copanlisib
Finerenone
Vericiguat
Molidustat
Vilaprisan
ISIS-FXIRx
Xarelto (Rivaroxaban)
Eylea (Aflibercept)
Xofigo (Radium-223
dichloride)
Stivarga (Regorafenib)
Adempas (Riociguat)
Life-cycle
Management Mid- and Late-stage
Pipeline Projects
• Bayer Investor Presentation • Meet Management • June 2015 Page 76
Expanding Life-cycle Management
Programs for Recently Launched Products
Major Adverse Cardiac Events:
COMPASS
Chronic Heart Failure:
COMMANDER-HF
Medically ill Patients: MARINER
Atrial Fibrillation Percutaneous Coronary
Intervention:
PIONEER AF-PCI
Embolic Stroke due to Unknown Source:
NAVIGATE ESUS
PHIII VIVID-EAST
Polypoidal Choroidal Vasculopathy -
PLANET
Phase III combination study in metastatic
prostate cancer
Phase II combination study in metastatic
breast cancer
Repeat dosing/higher dose in CRPC
Phase I/II studies in additional cancer
types
Phase II Eye-drop formulation in wet
AMD
Phase III in Liver Cancer 2nd line
Phase I combination studies to support
programs in various cancer types
Phase IIb in PH with Idiopathic Interstitial
Pneumonia
Phase IIb in Diffuse Systemic Sclerosis
RESPITE: Phase IIIB in PAH patients who did not respond top
PDE5-inhibitors
Signal-generating studies in Raynaud’s
phenomenon and Cycstic Fibrosis
Combination with PDGFR antibody
Peripheral Artery Disease (PAD): VOYAGER PAD
This slide provides a selection of studies
Cancer-associated Thrombosis (CAT):
CALLISTO
• Bayer Investor Presentation • Meet Management • June 2015 Page 78
Rivaroxaban X-VeRT Trial: Protecting
Patients with AF who Undergo Cardioversion
Restoration of sinus rhythm through cardioversion in patients with AF requires adequate
anticoagulation
Current guidelines recommend at least 3 weeks of effective anticoagulation with VKAs
prior to cardioversion1 and 4 weeks after the procedure
X-VeRT investigated the efficacy and safety of rivaroxaban compared to dose adjusted
VKA in patients with non-valvular atrial fibrillation scheduled for cardioversion
Main X-VeRT study findings:
50% numerical2 reduction in the risk of stroke, TIA, peripheral embolism, myocardial
infarction and CV-death (composite primary efficacy outcome) compared to VKA
24% numerically2 lower risk of major bleeding compared to VKA3
Shorter time to cardioversion compared to VKA
1) Or less if a transesophageal echocardiogram has revealed no thrombus in the left atrial or left atrial appendage; 2) Study not powered for statistical significance
AF: Atrial fibrillation; VKA: Vitamin K antagonist; TIA: Transient ischemic attack; CV: Cardiovascular 3) primary safety outcome
January 2015 – EU label was updated with information on clinical utility of rivaroxaban in
patients with AF who require cardioversion
• Bayer Investor Presentation • Meet Management • June 2015 Page 79
VENTURE-AF: Evaluating Rivaroxaban in
Patients Undergoing Catheter Ablation for AF
Catheter ablation is a technique routinely used in patients with AF in order to restore
normal heart rhythm.
Current guidelines recommend uninterrupted oral anticoagulation for these patients
before, during and after the procedure to reduce the risk of thromboembolic events.
VENTURE AF investigated rivaroxaban compared to dose adjusted VKA in 248 patients
undergoing catheter ablation for atrial fibrillation.
Main VENTURE AF study findings:
Rivaroxaban-Group: No thromboembolic events
No major bleeding (ISTH scale)
No major bleeding (TIMI and GUSTO scale)
VKA-Group: Two thromboembolic events
One major bleed (ISTH scale)
No major bleeding (TIMI and GUSTO scale)
Low incidence of non-major bleeding in both study arms
AF: Atrial fibrillation; VKA: Vitamin K antagonist
• Bayer Investor Presentation • Meet Management • June 2015 Page 80
Committed to Improving Thrombosis
Management – Clinical Studies and Registries
Registries
N≈97,000
Phase IV/NIS
N≈47,000
Phase IIIb
N≈2,400
Phase II/III
N≈51,000
Completed
Over 275,000 patients are expected to be included in both clinical trials and real world settings.
• Bayer Investor Presentation • Meet Management • June 2015 Page 81
Addressing Multiple Life-cycle
Opportunities for Radium-223 dichloride
Life-cycle Opportunities
Repeat dosing in CRPC
Higher dose in CRPC
Earlier disease stages
of CRPC
Combination studies in CRPC
Expansion into additional
cancer types
Addressed Through
Phase II trial assessing the short and long-term
safety of re-treatment
Phase II trial with dose higher than the
approved 50 kBq/kg
Phase I and/or II studies in breast cancer,
osteosarcoma and potentially in additional
cancer types
Phase III combination trial with abiraterone
Phase II trial in combination with abiraterone or
enzalutamide
• Bayer Investor Presentation • Meet Management • June 2015 Page 82
Regorafenib – Potential for Significant
Advances in Treating wAMD
Today’s standard of
care is administered
by injection into the
eye
Eye drops could
reduce efforts,
costs, logistics and
would be more
convenient
Regorafenib inhibits VEGF receptor
signaling, a well established principle
to treat wAMD
Regorafenib eye drops may offer
topical treatment of wAMD - targeting
superior convenience but non-inferior
efficacy
Phase I completed
Phase IIa/b initiated
Comparator: Lucentis
Target enrollment: N=350 patients
Completion expected April 2016
wAMD: Wet age-related macular degeneratio; Primary completion dates
as published at clinicaltrials.gov, status May, 2015
Current Standard intravitreal injection
Project Goal topical treatment (drops)
as additional option
• Bayer Investor Presentation • Meet Management • June 2015 Page 83
Potential of sGC Stimulation Goes Beyond
Vasodilation
cGMP
sGC - Stimulation
Schlossmann J & Schinner E. Naunyn Schmiedebergs Arch Pharmacol 2012;doi:10.1007/s00210-012-0730-6.
Stasch J-P et al. Circulation 2011;123:2263–73. Evgenov OV et al. Nature Rev Drug Disc 2006;5:755–68.
Effect of riociguat on bleomycin-
induced fibrosis in a mouse model (lung)
Anti-fibrosis Vasodilation Anti-proliferation Anti-inflammation
Evgenov OV et al. Poster presented at ATS, Denver, USA; 13–18 May 2011.
*p<0.05 vs control; †p=0.05 vs bleomycin
sGC: Soluble guanylate cyclase
cGMP: Cyclic guanosine monophosphate Riociguat is developed in collaboration with Merck & Co., Inc.
• Bayer Investor Presentation • Meet Management • June 2015 Page 84
Riociguat – Life-cycle Management Beyond
PAH and CTEPH
Positive phase II data in PH-ILD prompt initiation of phase IIb in PH-IIP (a specific sub-
segment of PH-ILD)
Majority of PH-IIP patients suffer from pulmonary hypertension due to idiopathic
pulmonary fibrosis
No approved treatment option
Phase IIb ongoing – completion January 2017e*
Chronic systemic autoimmune disease characterized by fibrosis
No approved treatment
Strong preclinical antifibrotic data
Phase IIb ongoing – completion July 2017e*
Riociguat is developed in collaboration with Merck & Co., Inc.
PAH: Pulmonary arterial hypertension; CTEPH: Chronic thromboembolic pulmonary
hypertension; PH-ILD: Pulmonary hypertension due to interstitial lung disease
*Primary completion dates as published at clinicaltrials.gov; status May, 2015
Pulmonary hypertension with idiopathic interstitial pneumonia (PH-IIP)
Diffuse systemic sclerosis (SSc)
• Bayer Investor Presentation • Meet Management • June 2015 Page 85
Data on Life-cycle Management Projects
Expected 2015 - Early 2017
Amikacin
inhale
Regorafenib
Rivaroxaban
Ra-223
Inhaled Antibiotic
Multi-kinase Inhibitor
Factor Xa Inhibitor
Alpha Pharmaceutical
Adjunctive therapy; intubated /
mech. ventilated patients with
gram-neg. pneumonia
2nd line HCC
Various areas
Bone metastases in breast
cancer
Completion* phase III
January 2016e
Completion* phase III
(RESORCE) April 2016e
NAVIGATE ESUS (PHIII) and
GEMINI ACS 1 (PHII)
ongoing, start PHIII
VOYAGER PAD, 2H 2015e
Completion* phase II May
2017e
Regorafenib Multi-kinase Inhibitor Wet AMD Completion* phase II April
2016e
Riociguat sGC Stimulator
Pulmonary hypertension (PH)
associated with idiopathic
interstitial pneumonia (IIP)
Completion* phase IIb January
2017e
*Primary completion estimates - published at clinicaltrials.gov; status April, 2015
Project Mechanism Target Area / Indication Milestone
• Bayer Investor Presentation • Meet Management • June 2015 Page 86
Mid- and Late-Stage Pharma Pipeline
Progressing – Current Timelines
CHF: Chronic heart failure; CRPC: Castration-resistant prostate cancer;
NHL: Non-Hodgkin‘s lymphoma; r/pEF: Reduced/preserved ejection fraction
Damoctocog alfa pegol
Hemophilia A
ODM-201
CRPC
Copanlisib
Cancer; NHL
Finerenone
Worsening CHF
Diabetic nephropathy
Vericiguat
Worsening CHF rEF
Worsening CHF pEF
Molidustat
Renal anemia
Vilaprisan
Uterine fibroids
Endometriosis
Phase III (pediatric)
Phase III
Phase IIa
Phase III
Phase IIb
Phase IIb
Phase IIb
Phase IIb
Phase IIb
2016 2015 2014
Phase IIb
Phase IIb
Phase IIa
PH III decision
PH III decision
PH III decision
PH III decision
PH III decision
reported
• Bayer Investor Presentation • Meet Management • June 2015 Page 87
Milestones – Mid- / Late-Stage Pipeline
Molidustat HIF-PH Inhibitor Renal Anemia First Phase II data 1H 2016e tbd
Finerenone Mineralocorticoid
Receptor Antagonist Diabetic Nephropathy Phase IIb; completed Reported
Finerenone Mineralocorticoid
Receptor Antagonist wCHF Phase IIb; completed ESC Aug/Sept 2015e
Copanlisib PI3-Kinase Inhibitor Non-Hodgkin‘s Lymphoma Phase II completion 1H 2016e tbd
Vericiguat sGC Stimulator wCHF; reduced ejection
fraction Phase IIb; compl. mid 2015e AHA Nov 2015e
Vericiguat sGC Stimulator wCHF; preserved ejection
fraction Phase IIb; compl. 2H 2015e Congress 2016e
Damoctocog
alfa pegol Long-acting FVIII Hemophilia A Data from Phase III reported Filing mid 2016e
Vilaprisan Progesterone
Receptor Modulator Uterine Fibroids
Phase IIb; completion 1H
2016e Reported
ODM-201 Androgen Receptor
Antagonist
Non-Metastatic Castration-
Resistant Prostate Cancer
Phase III ongoing, completion
2018e tbd
*Primary completion estimates - published at clinicaltrials.gov; status
May, 2015; **Current plan for presentation
Project Mechanism Target Indication Status/Completion* Milestone**
• Bayer Investor Presentation • Meet Management • June 2015 Page 88
ODM-201 – Strengthening Bayer’s Prostate
Cancer Franchise
enzalutamide 19%*
ARN-509 29%*
ODM-201 +
main metabolite 3% **
ODM-201 is an AR antagonist in
development in non-metastatic
CRPC
M0 prostate cancer market:
no approved therapies
Unique profile including
Promising phase II results
Low penetration into the brain
demonstrated in preclinical models
No CYP inhibition or induction
expected with therapeutic doses
In-licensed from Orion
Phase III ongoing
*Refs. Clegg et al, Cancer Research 2012; Forster et al, Prostate 2011; ** Rat autoradiography (QWBA) confirms brain/plasma ratio of 14C-ODM-201
related radioactivity was 0.04-0.06, indicating negligible penetration to the brain; profile published at ECC2013 poster E17-2119
ODM-201 has a unique preclinical profile
Compound AR
affinity
Ki (nM)
Antagonism
WT AR
IC50 (nM)
Proliferation
VCaP
IC50 (nM)
enzalutamide 78 155 400
ARN-509 53 168 300
ODM-201 9 65 500
ORM-15341
(main metabolite) 8 25 600
• Bayer Investor Presentation • Meet Management • June 2015 Page 89
MR-Inhibition is a Proven Principle in the
Treatment of Heart Diseases
MR(A): Mineralocorticoid receptor (antagonist)
HF: Heart failure
aldosterone / cortisol
Overactivated MR
causing e.g.
Na+ and water retention K+ loss Hypertensive effects Vascular
inflammation/injury Myocardial/renal fibrosis Proteinuria
MR antagonist
Kidney Heart
MR has multiple functions:
Regulation of salt, fluid homoestasis and
blood pressure
Mediator of oxidative stress, subsequent
inflammation, fibrosis and cardiorenal
disease
Steroidal MR antagonists spironolactone
and eplerenone have been shown to be
effective in reducing cardiovascular
mortality in patients with HF but are
underutilized due to the risk of
hyperkalaemia, renal dysfunction and
anti-androgenic / progestogenic side
effects
Steroidal MRA are not approved for
kidney diseases eg. diabetic nephropathy
• Bayer Investor Presentation • Meet Management • June 2015 Page 90
Finerenone –
Differentiated Profile Amongst MRA
MRA: Mineralocorticoid receptor antagonist
*based on published data as of Feb 2015; **Pitt B Eur J Heart Fail. 2012 Jun;14(6):668-75;
*** B. Pitt et al., Eur. Heart J. 2013; doi:10.1093/eurheartj/eht187; 1: vs. baseline;
Finerenone - Profile Summary* Finerenone - Data
At least as potent as Spironolactone
and as selective as Eplerenone (based
on in vitro data**)
● Lower incidence of hyperkalaemia vs. spironolactone
● Lower incidence of worsening of renal function
● Decreased BNP/NT-proBNP – a key parameter for
cardiac stress
At least similar efficacy and
improved safety vs. Spironolactone
(based on phase IIa (ARTS) data***)
Non-steroidal structure
(Eplerenone and Spironolactone are
steroids)
N
NH
N
O
OO
NH2
O
O
O
O
O
O
Spironolactone Eplerenone Finerenone
O
S
O
O
O
H
H H
• Bayer Investor Presentation • Meet Management • June 2015
Copanlisib – A Selective and Highly Potent
Pan Class I PI3K Inhibitor
Page 91
● Copanlisib is a potent pan PI3K
inhibitor with significant PI3Ka &
PI3Kd inhibitory activity
● Copanlisib may tackle both the
disease and resistance drivers:
● PI3Kd inhibition is recognized as a driver of
efficacy in NHL – quick onset of clinical response
● Upregulation of the PI3Ka isoform may lead to
tumor relapse via resistance mechanisms
● Dual inhibition of PI3Ka and PI3Kd may delay
resistance - leading to longer duration of response
● IV administration may provide a
differentiated safety profile vs.
oral administration-related side
effects including GI toxicity
d
a
Disease driver
Potential resistance
driver*
In aggressive lymphomas. Role of alpha in refractory / relapsed
lymphoma needs to be ascertained
A) Chem Biol (2013) 20:1364ff
Cellular IC50 values (nM)
PI3K: Phosphoinositol 3 kinase; NHL: (indolent) Non-Hodgkin’s Lymphoma
IC50: inhibitory concentration 50; GI: gastrointestinal; LFT liver function test
Isoenzyme
class
• Bayer Investor Presentation • Meet Management • June 2015
Copanlisib –
Comprehensive Clinical Program in NHL
Page 92
● Phase II in iNHL ongoing - preliminary results* encouraging:
● Significant activity shown
● Complete responses observed in several forms of NHL**
● Given positive phase IIa trial results, a successful development
program overall and regulatory approval, best-case scenario
could see first launch as early as 2017
● Phase III program in ≥ 3rd line iNHL and ≥ 2nd line iNHL initiated
● Clinical program also addresses aggressive NHL (DLBCL) –
phase II initiated
iNHL: indolent Non-Hodgkin’s lymphoma; DLBCL: diffuse large B cell lymphoma;
*Dreyling et al. ASH 2013; **in FL, mantle cell lymphoma, peripheral T-cell lymphoma
and DLBCL; *** providing positive results in the respective development programs
Copanlisib could potentially be positioned in both indolent NHL and
aggressive NHL***
• Bayer Investor Presentation • Meet Management • June 2015
NHL – Significant Potential for an Agent
Addressing the Unmet Need
Page 93
● Limited treatment options for dual
refractory iNHL patients –
refractory to Rituxan and an
alkylating agent
● Need for more effective options in
earlier lines of therapy
● Safer and more tolerable
therapies for long term utilization
● Need to address both disease
and resistance drivers to extend
overall survival
Unmet need in indolent NHL
2.37
5.72 2.2
3.4
0.96
1.48
0
2
4
6
8
10
12
2013 2020
Other NHL FL MZL
Global Market Size [$ billion]
Sources: Evaluate Pharma; Decision Resources
NHL: (indolent) Non-Hodgkin’s Lymphoma
FL: follicular lymphoma; MZL: marginal zone lymphoma
• Bayer Investor Presentation • Meet Management • June 2015
Copanlisib – Clinical Development Program
Broadly Addressing iNHL
Page 94
Patients with R/R iNHL
who progressed after
≥ 2 lines of treatment
N=120
NCT01660451
Copanlisib
IV; 60mg QW (3 weeks
on / 1 week off) until
disease progression
Primary outcome:
Tumor response
Selected inclusion criteria:
• Relapsed or refractory iNHL;
• at least 2 prior treatments
• Male or female; >18 years
• ECOG performance status ≤ 2
• Life expectancy of > 3 months
CHRONOS 1:
open-label, uncontrolled phase II
Patients with R/R iNHL
who progressed after
≥ 2 lines of treatment
N=189
NCT02369016
Copanlisib
IV; 60mg QW (3 weeks
on / 1 week off) vs.
placebo
Primary outcome:
Progression-free
survival
Selected inclusion criteria:
• iNHL; with foll. histologies: FL,
MZL, SLL; LPL/WM; MZL
• at least 2 prior treatments incl.
rituximab and alkylating agents
• refractory to the last rituximab-
based treatment (no response
or response lasting < 6 months)
CHRONOS 2:
randomized, double-blind phase III - Copanlisib vs. placebo in Rituximab-refractory iNHL
(i)NHL: (indolent) Non-Hodgkin’s Lymphoma; FL: follicular lymphoma; MZL marginal zone lymphoma; SLL: small
lymphocytic lymphoma; LPL/WM: : lymphoplasmacytoid lymphoma/Waldenström macroglobulinemia
QW: administration three weeks on days 1, 8 and 15 of each 28-day cycle
Patients with R/R iNHL
who progressed after
≥ 2 lines of treatment
N=567
NCT02367040
Copanlisib
IV; 60mg QW (3 weeks
on / 1 week off) +
Rituximab vs.
Rituximab + placebo
Primary outcome:
Progression-free
survival
Selected inclusion criteria:
• Confirmed CD20 pos iNHL;
• histologies: FL (grade 1.3a); SLL;
• LPL/WM; MZL relapsed after at
• least 1 prior treatments incl.
• rituximab and alkylating agents
• ECOG performance status ≤ 2
• Life expectancy of > 3 months
CHRONOS 3:
randomized, double-blind phase III - Copanlisib + Rituximab vs. Rituximab in 2L iNHL
Slide provides a selection of ongoing and currently planned studies only
• Bayer Investor Presentation • Meet Management • June 2015
Selective Progesterone Receptor Modulation
for Treatment of Uterine Fibroids
Page 95
● Uterine fibroids are the most common benign tumors in women of reproductive age: 5-10% of premenopausal population suffers from symptomatic fibroids
● Symptoms may include heavy menstrual bleeding and tumor size - related symptoms
● Current therapies include surgical procedures or short-term use of GnRH analogs for estrogen depletion
● Growth of fibroids strongly depends on progesterone and estrogen
● Progesterone receptor modulation may offer long-term treatment of uterine fibroids without estrogen depletion side effects of GnRH analogs
PR
Transcription
Activation
Endometrial
Modulation &
Fibroid Growth
sPRM
Transcription
Endometrial
Modulation &
Fibroid Growth
PR
GnRH: Gonadotropin-releasing hormone
sPRM: Selective progesterone receptor modulator
• Bayer Investor Presentation • Meet Management • June 2015
Vilaprisan –
Clinical Program Progressing
Page 96
● Vilaprisan is a novel oral, highly potent and selective progesterone receptor modulator
● Phase I data (N=67) showed proof of concept including*:
● Reduction of bleeding: induced amenorrhea (non-bleeding) in >60% of women treated with dosages >1mg/day
● Reversal of amenorrhea after treatment cessation
● No prohibitive safety findings
● Phase IIb (ASTEROID 1) in patients with symptomatic uterine fibroids ongoing – data expected 1H 2016
Vilaprisan Phase I data*
Dose effect curve for amenorrhea rate
0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 5
010
20
30
40
50
60
70
80
90
100
Point estimate (median)
90% Credible interval
Observed rate
Efficacy threshold
Dose (mg)
Am
enorr
hea r
ate
(%
)
*Data presented by Rohde et al, SRI 2015
• Bayer Investor Presentation • Meet Management • June 2015 Page 97
Renal Anemia is an Important Area of Unmet
Medical Need
Diseased kidneys do not produce sufficient levels of erythropoietin (EPO) in response to hypoxia, leading to anemia
CKD/ESRD is the leading cause of anemia in industrialized countries
Substitution with parenteral EPO is standard of care – however, un-physiologically high EPO doses correlate with significant side effects
There is a need for novel therapies that lack the side effects of high doses of EPO-substitution
CKD: Chronic kidney disease
ESRD: End-stage renal disease
Anemia
Low oxygen
level (Hypoxia)
Normal kidney
function
Impaired kidney
function
EPO
Red blood cell
formation
EPO
Normal red blood
cell count
Insufficient
formation of
red blood cells
• Bayer Investor Presentation • Meet Management • June 2015 Page 98
Molidustat – An Oral HIF-PH Inhibitor for
Treatment of Renal Anemia
Increased red blood
cell production
Inhibition of HIF-PH increases the
stability of HIF resulting in production of
endogeneous EPO - potential novel
therapeutic approach for the treatment
of renal anemia
Under normal oxygen conditions, HIF
gets hydroxylated by HIF-PH and then
degraded
Under hypoxia conditions, HIF is
activated and induces the synthesis of
erythropoietin (EPO) in the kidneys
which stimulates red blood cell
formation
Nucleus
HIF HIF
Low oxygen levels
HIF Hydroxylation
HIF
Normal oxygen levels
HIF-PH
O2
hHIF hHIF
Degradation
Degraded HIF
HIF HIF
Inhibition of HIF-PH in renal
HIF-PH
O2
EPO ↑
Nucleus
EPO ↑
Nucleus
Increased red blood
cell production
HIF: Hypoxia-inducible factor
HIF-PH: HIF prolyl hydroxylase (enzyme)
hHIF: hydroxylated HIF
• Bayer Investor Presentation • Meet Management • June 2015 Page 99
Molidustat –
Proof of Concept Demonstrated
EPO: Erythropoietin
HIF-PH: HIF prolyl hydroxylase
Molidustat is a novel oral inhibitor of the enzyme HIF-PH
In development for the treatment of anemia associated with chronic kidney disease
Phase I in healthy subjects showed:
Significant increase of EPO levels after ≥ 12.5 mg
Significant increase of reticulocytes for doses ≥ 37.5 mg
No prohibitive safety findings
First data from ongoing Phase IIb program expected 1H 2016
Maximal EPO concentration after single dose administration of Molidustat (Phase I)
0
10
20
30
40
50
Placebo 5 mg 12,5 mg 25 mg 37,5 mg 50 mg
EP
O [
U/L
]
Dose
• Bayer Investor Presentation • Meet Management • June 2015 Page 100
Robust Innovation Pipeline in Hemophilia
and Bleeding Disorders
Kogenate
BAY 81-8973
Damoctocog Alfa Pegol (long acting FVIII)
Phase I Phase II Phase III Filed Marketed Preclinical
FVIII substitution
Novel MoA Gene Therapy
Oral Plasminogen-Inhibitor
Anti-TFPI Antibody
TFPI: Tissue factor pathway inhibitor
MoA: Mode of action
• Bayer Investor Presentation • Meet Management • June 2015 Page 101
Expanding the Hemophilia Franchise – Long-
Acting Site-specific PEGylated Factor VIII
Damoctocog alfa pegol (BAY 94-
9027) is a site-specific PEGylated B-
domain-deleted recombinant factor
VIII (BDD-rFVIII)
Attachment of PEG extends half-life
without reducing FVIII activity
Positive PROTECT VIII phase III
data
Filing planned for mid 2016
Site-specific
PEGylation to
extend FVIII
half life
B-domain
deletion
• Bayer Investor Presentation • Meet Management • June 2015 Page 102 ABR: Annualized bleeding rate
PROTECT VIII is a pivotal study assessing safety and efficacy of the site-
directed PEGylated FVIII Damoctocog alfa pegol
Part A: On-demand and prophylactic treatment (completed)
Part B: Major surgery (completed)
6
Randomization
0 10 14 20 28 weeks
2x/week 25 IU/kg (n 120)
2 or more breakthrough bleeds:
No or 1 breakthrough bleeds:
36
Screening
Screening
2
On-demand therapy individual dosage n=20
2x/week 30 to 40 IU/kg n=24*
Every 5 days 45-60 IU/kg n=43
Every 7 days 60 IU/kg n=43
* 13 assigned due to bleeding; 11 default/randomization arms full
38
Damoctocog alfa pegol (BAY 94-9027) –
Design of the PROTECT VIII Phase III Study
• Bayer Investor Presentation • Meet Management • June 2015 Page 103
Met primary objective of protection from bleeds with fewer infusions
10 week run in-period to identify patients at high risk of bleeding, who need 2x/week dosing (12%) -
for 88%, primary objective of protection from bleeds with fewer infusions met
Extending infusion intervals up to 7 days resulted in protection from bleeds
No inhibitors against FVIII developed during treatment period, hypersensitivity reaction in two patients
within the first 2 weeks of treatment
Study Arm
Patients (n)
remaining on
treatment
Patients with no
bleeding Median ABR
Prophylaxis: infusion
2x/week n.a. n.a. 17.4 (reduction to 4.1 after
dose increase)
Prophylaxis: infusion
every 5 days 43/43 44% 1.9
Prophylaxis: infusion
every 7 days 32/43 37%
(incl. non-completers)
3.9 *
(incl. non-completers)
On-demand treatment n.a. n.a. 23.0
*Median ABR for the 32 (74%) completers was 0.96
ABR: Annualized bleeding rate
Damoctocog alfa pegol Phase III Results -
Reduction of Infusion Frequency in Prophylaxis
• Bayer Investor Presentation • Meet Management • June 2015 Page 104
Inhibition of fibrinolysis by inhibiting
plasminogen is an accepted
principle to prevent bleeding
Small molecule plasminogen
inhibitor currently in preclinical
testing for oral administration
Potential target indications include
hemophilia, vWD, platelet function
disorders, FXI deficiency
Initiation of phase I expected mid
2015
Characteristics Tranexamic
Acid
BAY
Frequency of dosing 3-4 times/day once a day
Estimated dose ~10 g <0.5 g
Potency (KD) 660 nM <10 nM
Clot stability 90% lysis* 2% lysis*
Inhibition of fibrinolysis stabilizes clots
Fragile clots of patients with bleeding
disorders remain in place until healing occurs
Plasminogen-deficiency is not thrombogenic
BAY
Plasmin Plasmino-
gen
Fibrin clot
tPA
endothelium
*4 hours after p.o. administration of 30mg/kg p.o. to rats
tPA: Tissue plasminogen activator
vWD: von Willebrand disease
Plasminogen-Inhibition for Treatment of
Rare Bleeding Disorders
• Bayer Investor Presentation • Meet Management • June 2015 Page 105
TFPI is a single-chain polypeptide
which can reversibly inhibit various
clotting factors leading to bleeding
TFPI-inhibition may offer a potential
novel treatment principle for
Hemophilia A/B patients with or
without inhibitors
Hemophilia patients depend on extrinsic
pathway for clotting. anti-TFPI Ab inhibits
TFPI - thereby restoring impaired
hemostasis
BAY1093884 is a fully human moAB
Phase I initiated
TFPI: Tissue factor pathway inhibitor
moAB: monoclonal antibody
anti-TFPI Facts Role of TFPI in Coagulation
TFPI-Inhibition as a Potential Novel
Treatment Principle for Hemophilia A/B
• Bayer Investor Presentation • Meet Management • June 2015 Page 106
Antisense oligonucleotide that
specifically reduces the biosynthesis
of clotting factor XI
Potential for prevention of thrombosis
in patients for whom currently
available anticoagulants may not be
used
Positive Phase II data, Phase II
ongoing
In-licensed from Isis-Pharmaceuticals
Bayer to assume global clinical
development as well as worldwide
regulatory and commercialization
responsibilities
1) Büller et al., N Engl J Med. (2015) 372; 232
ISIS-FXIRX an Antisense Drug Candidate for
the Prevention of Thrombosis
Prevention of thrombosis in patients
undergoing total knee arthroplasty1
0
5
10
15
20
25
30
35
ISIS FXI ISIS FXI Enoxaparin
Thrombosis (%) Bleeding (%)
Primary efficacy outcome: total venous thromboembolism
Principal safety outcome: major or clinically relevant non-
major bleeding
200 mg 300 mg 40 mg
• Bayer Investor Presentation • Meet Management • June 2015
Anti-FXIa Antibody Developed for
Anti-Coagulation Therapy
Page 107
Inhibition of FXIa has potential for anti-
thrombotic therapy without increased
bleeding
FXI deficiency is associated with a reduced
incidence of Ischemic Stroke and DVT
BAY1213790 is a fully-human IgG1
antibody
Preclinical studies showed
Strong antithrombotic effect in standard
animal models of venous & arterial
thrombosis
No bleeding in sensitive animal models
despite overdosing & combination with
antiplatelet therapy
Phase I initiated
ASA ASA ASA ASA ASA ASA
BAY1213790
Thro
mbus w
eig
ht
[mg]
20
10
0
Ble
edin
g t
ime [s]
ASA ASA ASA ASA ASA ASA
BAY1213790
200
400
Preclinical data (Rabbit Model)
Ctrl 0.1 0.3 1 3 10
Ctrl 0.1 0.3 1 3 10 mg/kg
mg/kg
ASA: Acetylsalicylic acid
DVT: Deep vein thrombosis
Attractive Early Pipeline Projects*
• Bayer Investor Presentation • Meet Management • June 2015 Page 108 *Selection only
BAY 1067197 Non-nucleosidic partial A1 receptor
agonist
Worsening chronic heart failure Phase IIa
ISIS-FXIRx FXIa antisense Anti-coagulation therapy Phase II
BAY 1213790 FXIa antibody Anti-coagulation therapy Phase I
BAY 1142524 Chymase inhibitor Cardiovascular diseases Phase I
BAY 1093884 Anti-TFPI antibody Hemophilia Phase I
Plasminogen-
Inhibitor
Inhibition of fibrinolysis Various bleeding disorders incl.
hemophilia
Phase I start mid
2015e
Roniciclib Pan-CDK-inhibitor Small-cell lung cancer Phase II
Anetumab
ravtansine
Mesothelin antibody-drug-
conjugate
Solid tumors Phase II
BAY 1179470 FGFR2 antibody Solid tumors Phase I
BAY 2010112 PSMA-BiTE Prostate cancer Phase I
BAY 1128688 AKR1C3 inhibitor Endometriosis Phase I
Project Mechanism Target Indication Status
OTC-
Leadership
€ billion
• Bayer Investor Presentation • Meet Management • June 2015 Page 110
Consumer Care - #2 Player in a
Fragmented, Growing OTC Market
Market Category Split 2014** Market Positions 2014*
*Pro-forma OTC sales 2014 after allowing for the Novartis/Glaxo deal and
Bayer/Merck transaction; ** Growth 2014 vs. 2013
CC: Consumer Care; CASF: Cold, Allergy, Sinus, Flu; GI: Gastrointestinal
5.5%
GSK/Novartis Bayer/Merck CC
J&J Sanofi Pfizer
RB Boehringer P&G Taisho Takeda
€112.0bn
Other
13%
21%
15%
19%
13%
19%
Dermatology (+7.1%)
CASF (+2.6%)
Analgesics (+5.9%)
Nutrition (+4.5%)
GI (+7.0%)
Others
€112.0bn (+5%)
market data based on IMS/PARS FY 2014
Page 111
A global OTC leader with €5.6bn sales*
Track record of market outperformance
Broad geographic presence
Excellent presence in key categories
Leading consumer brands with decade-
long brand equity
Dedicated management team with strong
track record of both performance and
smooth integration of acquired brands
Consumer Care – A Global Leader in the
OTC Market
*Pro-forma combined sales 2014 including Merck & Co.
Consumer Care and Dihon • Bayer Investor Presentation • Meet Management • June 2015
• Bayer Investor Presentation • Meet Management • June 2015 Page 112
Portfolio of some of the world’s most
recognized OTC brands
Outperforming market growth in past
7 out of 8 years
Successful expansion in EM focus
markets China, Brazil, and Russia
Selected bolt-on acquisitions in key
countries: Steigerwald/Germany and
Dihon/China
Acquisition of Merck & Co’s Consumer
Care business
3.4 3.5
3.9 3.9
4.2
2010 2011 2012 2013 2014
+5%
+7% +6%
Consumer Care sales in € billion; Δ% Fx & portfolio adj.
Successfully Executing Growth Strategy
+5%
• Bayer Investor Presentation • Meet Management • June 2015 Page 113
Strategic Focus on OTC Growth
Grow in Emerging Markets and the US - increase scale & scope
Maximize brand potential - focus on innovation & global expansion
Bolt-on acquisitions – strengthen portfolio & regional presence
Accelerate consumer-centric innovation – improved pipeline
Focus on five key categories:
CASF, dermatology, analgesics,
gastrointestinal, nutritionals
Focus on OTC blockbuster brands
with annual sales volume of >€100m
Grow brands through line extensions
and geographic expansion
Reflect deep customer insights in
innovative products
Leverage Rx-to-OTC switch
capabilities
• Bayer Investor Presentation • Meet Management • June 2015 Page 114
Building Long-Term Brand Equity
CASF: Cold, Allergy, Sinus, Flu
Maximize brand potential -
focus on innovation & global
expansion
• Bayer Investor Presentation • Meet Management • June 2015 Page 115
Strong Consumer Brands Build Equity
For Decades
Brands Years Old 2014 Sales €m yoy change (Fx-adj.)
115 9271 +5%
27 495 -
21 350 +10%
70 346 +18%
42 253 +3%
83 2262 +6%
62 198 -
109 187 -
71 167 -5%
56 154 +8%
Top 10 Brands Ø 66 3,303
Former Merck &Co Inc brands 2014 sales are pro-forma; Claritin (excl. Rx) 1Total Aspirin includes Aspirin Complex and Aspirin Cardio
(Rx);2Total Alka-Seltzer includes Alka-Seltzer and Alka-Seltzer Plus
Leading Category Positions with Well-
Known Brands
• Bayer Investor Presentation • Meet Management • June 2015 Page 116
1 incl. Cardio; 2 incl. Suncare; 3 incl. foot health, women’s health, other
*After allowing for the Novartis/Glaxo deal
Global position*
Continue innovations to keep brands
relevant to consumers
Provide new benefit areas to
consumers, e.g., Aleve PM,
TruBiotics
Develop Rx to OTC switch pipeline
Further develop & expand natural /
herbal portfolio (Steigerwald, Dihon)
• Bayer Investor Presentation • Meet Management • June 2015 Page 117
Need for Robust Innovation Pipeline
Accelerate Consumer-centric
innovation – develop improved
new product pipeline
• Bayer Investor Presentation • Meet Management • March 2015 Page 118
New Aspirin – One of The Biggest
Advances in Brand’s 115-Year History
* Two post-surgical dental pain efficacy studies were conducted to evaluate Bayer New Aspirin 500 mg and 325 mg tablets; both demonstrated
faster onset of pain relief compared to the previous Bayer Aspirin tablet. The results demonstrated that Bayer New Aspirin provides meaningful
pain relief twice as fast as previous Bayer Aspirin tablets.
Patent-pending micro-active technology
Clinically proven to relieve pain twice as
fast as before*
Innovative product characteristics
Launch strategy
Re-introducing Aspirin as modern and
efficacious pain reliever
Launched in Germany and Italy in 2014**
Plans to expand into 25+ countries in Europe
and Latin America through 2016
Consumer benefit
Effective pain management - speed of relief
and product strength being critical
No major changes in overall tolerability
** Italy: June 2014, Germany: mid-July 2014
Innovative product characteristics
● First OTC PM product to contain Naproxen
Sodium and Diphenhydramine HCI combination
Consumer benefit
● Consumers are yearning for a pain relieving
sleep product that provides pain relief that can
last until the morning
● Provides a sleep aid with 12-hour relief of Aleve
so you can have a restful night’s sleep with less
pain that can lead to a better morning
Launch status
● Launched in USA September 2014
Aleve PM – Addressing Consumer Needs
Through Innovation
• Bayer Investor Presentation • Meet Management • June 2015 Page 119
Establish strategic partnerships with
retailers through scale & scope
Transfer brand success from
developed to emerging markets
Focus on key emerging countries
Brazil, Russia and China
Create marketing excellence
through global best-practice sharing
• Bayer Investor Presentation • Meet Management • June 2015 Page 120
Building Success Stories in Emerging
Markets and the US
Grow in Emerging Markets and
the US - increase scale & scope
• Bayer Investor Presentation • Meet Management • June 2015 Page 121
Enhanced Scale and Broader Category
Scope Improve Product Offerings
Example: US CASF category Benefits from Enhanced Scale
Co-promoting complementary
brands
New item assortment and shelving
opportunities
Improved merchandising
efficiencies
Bigger and more impactful trade
events
Foster strategic partnerships with
retailers
FY 2014 retail sales in CASF in $ million*
*Source: IRI; Latest 52WK; December 2014
CASF: Cold, allergy, sinus, flu
Make Consumer Care a Top Strategic Partner for US Retailers
$0
$100
$200
$300
$400
$500
$600
$700
$800
$900
$1,000
Exploiting Brand Potential Globally
Brand Sales by Major Region 2014 Expansion Plans
• Bayer Investor Presentation • Meet Management • June 2015 Page 122
Analgesic ~80% in North America
~95% in North America
Wound-healing 70% in Europe
Anti-fungal 70% in Europe & LatAm
Vitamins & minerals ~60% in Europe
~80%* in North America CASF
Sun Care
*Claritin (excl. Rx)
• Bayer Investor Presentation • Meet Management • June 2015 Page 123
Country OTC Market Sales 2014* Execution Plans
China
Global #2
Bayer Consumer
Care #1
+28%
Extend geographic footprint by launching
global brands in China (e.g. build sun care
category with Coppertone and extend Claritin
Leadership)
Brazil
Global #6
Bayer Consumer
Care #8
+26% Focus on brand building and channel
capabilities to gain share in key new
categories (Suncare, Allergy, Footcare)
Russia
Global #7
Bayer Consumer
Care #2
+26% Focus on CASF brands using current position
to roll-out extended offerings
Continue Successful Emerging Market
Strategy with New Portfolio
*Bayer Consumer Care sales, Fx-adj. growth
Market data based on IMS/PARS FY 2014
Enhanced regional positioning
in the Americas and China
Strengthened category positioning
in dermatology, GI, CASF
Closed gaps in allergy indication
Entered herbal medicines
Improving growth / profitability profile
Focus on realization of significant
synergy potential
• Bayer Investor Presentation • Meet Management • June 2015 Page 124
Pursuing External Opportunities Strengthen
Portfolio and Regional Presence
Bolt-on acquisitions –
strengthen portfolio & regional
presence
CASF: Cold, Allergy, Sinus, Flu; GI: Gastrointestinal
Page 125
Strengthening Portfolio Through Highly
Complementary Business Acquisitions
Dihon Pharmaceutical
Group: Chinese OTC brands
Merck & Co. Consumer Care:
American OTC/CC brands
Creating leading position
amongst multinationals in
OTC China
Access to lower-tier cities
Entry into Traditional
Chinese Medicine
Creating global OTC #2
Scaling-up US business
to #1
Gaining global leadership
in dermatology and GI
Entry into new categories:
Allergy, Suncare, Footcare
Established pharmacy-
only herbal products
Competence in
increasingly important
phytopharmaceuticals
Steigerwald:
Herbal medicines
• Bayer Investor Presentation • Meet Management • June 2015
Note: Steigerwald closed in 06/2013, Dihon closed in 11/2014
Merck & Co. Consumer Care closed in 10/2014
Well-Positioned for Future Growth –
Aspire to OTC Leadership
Strong #2 position
Leader in key categories
Multiple strong brands
Success in long-term
brand building
Track record of out-
performing market
Successful M&A
Globalize established brands
Launch innovation pipeline
Execute EM focus strategies
Successfully realize synergy
potential from acquisitions
Target strategic acquisitions
and alliances
Page 126 • Bayer Investor Presentation • Meet Management • June 2015
Plans for
continued growth Achievements
Animal Health
Page 128 • Bayer Investor Presentation • Meet Management • June 2015
Animal Health –
A Strong Player in an Attractive Market
Sales in € million; Δ% Fx & portfolio adj.
Overall global #5 and global #2 in
parasiticides
Ranked #3 in CAP (~60% of sales)
Sector driven by:
Emotional relationships to pets
Infectious and chronic diseases
Ranked #7 in FAP (~40% of sales)
Sector driven by:
Increasing customer/consumer
awareness
Food safety & disease transmission
Globalization in farm exports
Highlights
977
1,120
1,186
1,303 1,306 1,318
2009 2010 2011 2012 2013 2014
+4%
CAP: Companion animal products
FAP: Food animal products
Page 129 • Bayer Investor Presentation • Meet Management • June 2015
Animal Health –
Global Trends Drive Growth Opportunities
Pet well-being – “family” members
Convenience & Quality of Life
Resistance breaking parasiticides
Emerging resistance to antibiotics -
alternatives to antibiotics
Robust prevention and control of infectious
diseases
Improved productivity & cost-benefit ratio
Safe and sustainable food
Trends driving needs…
Page 130 • Bayer Investor Presentation • Meet Management • June 2015
Selected R&D Activities
New formulations
Antimicrobials Pharmaceutical
Specialties Parasiticides
Focus to improve:
Convenience
Efficacy
Safety
Antibiotics (Quinolones)
Dairy Health
Respiratory Diseases
Allergy & Inflammation
Chronic Kidney Disease
Ecto- parasiticides
Endo- parasiticides
Endecto- parasiticides
R&D Investment approx. 10% of sales
Immuno-stimulation
Metaphylaxis
Respiratory Diseases
others
Page 131 • Bayer Investor Presentation • Meet Management • June 2015
Antiinfective Health Management –
Current Limitations and Potential Solution
Limitations at present… … potential future solution
Prevention
(vaccines)
Treatment
(antibiotics)
Metaphylaxis
(antibiotics play in the category)
● Treatment: political / public pressure on
antibiotic use (resistance)
● Prevention: weeks delay in onset of
immunity, protection limited to selected
antigens
Prevention
(vaccines)
Treatment
(antibiotics)
Metaphylaxis
(immunostimulation)
● Not antigen-specific („one-for many“)
● Potential use in prophylaxis AND treatment
● Fast onset of activity
Page 132 • Bayer Investor Presentation • Meet Management • June 2015
Innovative Immunostimulants – Potential Non-
Antibiotic Solution to Combat Infections
● jump-starts the
innate immune
system & helps to
eliminate infection
● Broader effect than
antibiotics and no
resistance building
● Faster & broader
effect than vaccines
● Ideal herd treatment to
reduce disease &
antibiotic usage
● Field trials ongoing
● Pending positive data, launches in 2015e
From Lab… … to Market
Sustained Life Cycle Management Building
On Excellent Brands
• Bayer Investor Presentation • Meet Management • June 2015 Page 133
Our Animal Health business demonstrated strength in LCM over the past decades with a
number of top selling Brands in Industry
Advantix: + permethrin
Spectrum: + tick/mosquito
Advocate: + moxidectin
Spectrum: + worms
Advantage: imidacloprid
Spectrum: fleas/lice
Seresto: Imidacloprid/flum. collar
Spectrum: fleas/ticks 8 months duration
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
600
500
400
300
200
100
0
Advantage
Advantix
Advocate
Seresto
LCM: Life Cycle Management
Page 134 • Bayer Investor Presentation • Meet Management • June 2015
Advocate – Achieving Double-Digit Growth
Ten Years After Launch
● Advocate brand is a member of the
Advantage family of parasiticides
● Long-term growth due to continuous post
marketing studies supporting new claims
● Strong performance in EU, especially in
UK due to first in category lungworm claim
Highlights
2013
136
149
+10%
2014
Advocate Sales € million; Δ% Fx adj.
Page 135 • Bayer Investor Presentation • Meet Management • June 2015
Seresto – On Track to Become a Leading
Product in Animal Health
● Seresto showed strong over-
performance in all regions since
launch
● Life-cycle management includes new
claims on vector borne diseases
● Target at least €100m sales mid-term
2014
52
+71%
2013
31
2012
9
US
Ex-America
Highlights Seresto Sales € million; Δ% Fx adj.
Medical Care
Page 137 • Bayer Investor Presentation • Meet Management • June 2015
Medical Care – A Global Player in Diabetes
Care and Radiology
Radiology Diabetes Care
Sales 2014
Medical Care €2,360m; -7% (-4%)
38% 62%
€ million; Δ% yoy, () = Fx & portfolio adj.
Diabetes Care:
Comprises self testing blood
glucose monitoring devices
- to be divested
Radiology
Combines our Contrast
Media, Injector and
Informatics businesses
Page 138 • Bayer Investor Presentation • Meet Management • June 2015
Radiology – Leading Positions in Contrast
Media and Application Devices
1,363
1,474 1,498
1,606
1,519 1,459
2009 2010 2011 2012 2013 2014
Sales in € million; Δ% Fx & portfolio adj.
0% Integrated subsidiary Medrad Inc. and
our contrast media business
The business comprises:
Contrast media: CT and MRI
Contrast media injectors: Medrad
brand
Informatics
Services
Synergies through focus on similar
centers / physicians
Highlights
CropScience
• Bayer Investor Presentation • Meet Management • June 2015 Page 139
We Expect the Ag-Input Market to Grow
to Around €100bn by 2020
• Bayer Investor Presentation • Meet Management • June 2015 Page 140
CHANGING
CONSUMPTION PATTERNS
POPULATION
GROWTH
COMMODITY PRICE
VOLATILITY
WEATHER
FLUCTUATIONS HECTARES OF
FARMLAND
PER CAPITA
INSUFFICIENT
STORAGE
HUNGER
DECLINE IN FARMER
POPULATION
HIGHER ENVIRON-
MENTAL STANDARDS
Core challenges in the future Increase in global crop
production is required to meet
future demand for food, feed,
fuel and fiber
To cope with challenges such
as climate change and limited
global farmland, higher yields
per hectare are key
Professionalization in emerging
markets ongoing
Innovation in Agriculture is vital
to safeguard harvests and
secure future food supply
Ag input market includes Crop Protection, Seeds & Traits
Source: Bayer CropScience forecast, February 2015
Fulfilling Customer Needs with Differentiated
and Sustainable Crop Solutions
• Bayer Investor Presentation • Meet Management • June 2015 Page 141
Differentiated and Sustainable Crop Solutions
Chemical
Crop
Protection
Biological
Crop
Protection
Seeds
Herbicides
Fungicides
Insecticides
SeedGrowth
Microbial
fungicides,
insecticides and
nematicides
Canola, cotton,
rice, soy, wheat,
vegetables
Conventional
seeds
GMO seeds
Traits
Weed, pest &
disease control
Stress
tolerance
Resistance
management
Customer Needs:
Yield
Quality
Convenience
Tradeability
Processability
Sustainability
GMO: Genetically modified organism
Services
24%
22%
14%
14%
8%
7%
5% 4% 3%
Fruits & Vegetables
Cereals Oilseed
Soy
Corn
Cotton
Rice
Sugar Crops
CropScience Sales 2014*
Other
Fruits, Vegetables and Cereals –
A Major Part of Our Portfolio
• Bayer Investor Presentation • Meet Management • June 2015 Page 142 *by major crop groups excluding industrial business and non-agricultural solutions
Customer-Centric Strategy Pays Off
• Bayer Investor Presentation • Meet Management • June 2015 Page 143
Enhance Crop
Protection & ES
Strengthen
Customer Centricity
Lead the Way
in Innovation
Expand
Seeds Business
Adding new and
improved products
Concentrating on
core brands
Offering integrated
solutions
Expanding production
capacities
Driving commercial
excellence in
marketing and sales
Connecting partners
along the value chain
through integrated
Go-to-Market
practices
Build on expertise in
seeds, breeding,
chemical and
biological crop
protection to develop
holistic solutions
Explore new areas of
innovation, such as
digitization in
agriculture
Further strengthening
position in rice,
vegetables, oilseed
rape and cotton
Extend portfolio by
building up significant
positions in soybeans
and wheat
ES = Environmental Science
Performance
FY 2014 – Record Sales and Earnings
• Bayer Investor Presentation • Meet Management • June 2015 Page 145
Crop Protection
+7% (+11%) Environmental
Science
+4% (+7%)
Seeds
+13% (+20%)
CropScience €9,494m; +8% (+11%)
Price
+2%
Volume
+9%
Fx
-4%
Portfolio
0%
7,712
FY‘13 FY‘14 FY‘13 FY‘14
2,248 2,360 +5%
1,801 1,838 +2%
Adj.
EBITDA
Adj.
EBIT
678
1,104
25.5% 24.9%
€ million; Δ% yoy, () = Fx & portfolio adj.
Sales
€ million; before special items
Earnings
25%
CropScience €9,494m; +8% (+11%) Latin
America
Eastern
Europe
Africa &
Middle East
Emerging
Asia³
~920
+6%
2,510
+21%
~660
+17%
~320
+18%
FY 2014 – Strong Contribution to Growth
from Emerging Economies, esp. LatAm
• Bayer Investor Presentation • Meet Management • June 2015 Page 146
18%
USA
+10%
24%
46%
12%
Emerging
Economies¹
+17%
Western
Europe +4%
Others²
+9%
€ million; Δ% Fx adj.
CropScience Sales
€ million; Δ% Fx adj.
Emerging Economies
¹ Emerging economies include: Latin America, Asia w/o Japan, Australia,
New Zealand, Africa and Middle East incl. Turkey, Eastern Europe
² Others = Japan, Australia, New Zealand, Canada
³ Emerging Asia = Asia w/o Japan, Australia, New Zealand
FY 2014 – Growth Above Market
• Bayer Investor Presentation • Meet Management • June 2015 Page 147
*Sources: Cropnosis (Crop Protection) and GFK (Seeds)
CP excl. biologics; growth rates based on USD nominal
data; Seeds: incl. GM seeds & traits/biotechnology,
growth rates based on USD data; ES: internal estimates
2014 Sales (€ million)
Growth (Δ%yoy fx&portfolio adj.)
Market
Growth*
Growth
above market
Crop Protection 7,712 +11% +5%
Seeds 1,104 +20% +6%
Environmental
Science 678 +7% +3%
2014 Market position
Crop Protection #2
Seeds #7
Environmental
Science #1
Q1 2015 - Steady in Weak Market
Environment
• Bayer Investor Presentation • Meet Management • June 2015 Page 148
€ million; Δ% yoy, () = Fx & portfolio adj.
Sales
€ million; before special items
Earnings
Crop Protection
+3% (-1%)
Environmental Science
+22% (+4%)
Seeds
+19% (+8%)
CropScience €3,092m; +7% (+1%)
Price
+3%
Volume
-2%
Fx
+5%
Portfolio
+1%
2,292
Q1‘14 Q1‘15 Q1‘14 Q1‘15
1,089 1,040 -5%
988 921 -7%
203
597
Adj.
EBITDA
Adj.
EBIT
Herbicides
Fungicides
Seeds
Decline mainly driven by North America
Double-digit growth in Europe
High demand for cereal prod. in Europe
Fox maintained its leadership in Brazil
Decline mainly driven by lower pest
pressure in Brazil
Lower sales in North America due to
reduced corn acreage
Sales increase in all core crops, esp.
oilseed rape / canola and soybeans
Underlying growth in both segments
Acquisition of DuPont Land Management
906
- 8%
830
+22%
335
-13%
221
-17%
203
+4%
597
+8%
Insecticides
Sales in € million; Δ% yoy Fx & portfolio adj.
Q1 2014 Nominal yoy growth/decline Q1 2015
Page 149 • Bayer Investor Presentation • Meet Management • June 2015
Seed
Growth
Env.
Science
Q1 2015 – Slight Decline in Crop Protection
Compensated by Growth in Seeds and ES
ES = Environmental Science
We expect to grow faster than the market
We aim to raise sales to approx. €11 billion
This corresponds to a low- to mid-single-digit percentage increase on a
currency- and portfolio-adjusted basis
We anticipate positive currency effects of about 11% compared with 2014
We plan to improve EBITDA before special items by a low- to mid-teens
percentage
• Bayer Investor Presentation • Meet Management • June 2015 Page 150 Assuming spot Fx rates as of March 31, 2015 for rest of the year
Outlook depends on specific planning assumptions outlined in the Annual Report
Full Year 2015 Guidance (Q1 update)
861 974
1,080
2013 2014 2015e
Key Investments to Fuel Future Growth of
CropScience Independent of Cycle
• Bayer Investor Presentation • Meet Management • June 2015 Page 151
Assure pipeline delivery
Enhance Biologicals portfolio
Build enabling technology platforms
Expansion of production capacity for
herbicide glufosinate-ammonium
Integrated R&D site for vegetable
seeds and biological crop protection
Build soybean and wheat business
2013 – 2016e CapEx: €2.4bn
Key Investment Areas
453
634 720
2013 2014 2015e
€ million
R&D expenses
€ million; PPE only
CapEx
*
2015e
2015e
~700
~1.1bn
*R&D expenses 2013 restated
Innovation
€1.9bn
2014 Target of > €1.8bn Sales From New
Crop Protection Products Achieved
• Bayer Investor Presentation • Meet Management • June 2015 Page 153
0.4
0.7
1.1
1.5
1.9
~2.8
2010 2011 2012 2013 2014 2017e
Insecticides
New products generated nearly 70% of
absolute sales growth at Crop Protection
Herbicides
SeedGrowth Fungicides
By segment € billion; new CP products launched since 2006
New product sales
+44% CAGR
Poncho VOTiVO
Includes a biological
providing protection
against nematodes > €250m 2011
Adengo > €350m 2009 Cross-spectrum weed
control in corn at low
use rate
Four Crop Protection Innovations Launched
with High Potential
• Bayer Investor Presentation • Meet Management • June 2015 Page 154
Product Key Customer Benefit Peak Sales Potential
Luna Fungicide prolongs
shelf-life of misc. fruits
& veg. by several days > €250m 2012
Xpro Cereal fungicide can
raise yields by >10%* > €300m 2011
Launch
*Individual trials in high-yielding locations, depending
on crop, variety and disease pressure
R&D Priorities at CropScience to Deliver
Differentiated and Sustainable Crop Solutions
Innovate first and best in class products
Life-Cycle Management to fully exploit portfolio value
Strategies to defend existing products
Deliver
Integrate
Multiple technologies toolbox
Global and integrated R&D organization
State-of-the-art enabling platforms
World class external collaboration network to strengthen
scientific expertise
Bayer-internal R&D synergies
Open
Innovation
• Bayer Investor Presentation • Meet Management • June 2015 Page 155
Superior R&D Position with Integrated
Approach and Enabling Technologies
• Bayer Investor Presentation • Meet Management • June 2015 Page 156
Accelerated
discovery of target genes
Trait Research
Improved selection &
classification of lines
Breeding
Improved quality of candidate selection & lead discovery
Chemicals
Accelerated
discovery of leads
Biologicals
Biologicals Customer
Need Breeding
Trait
Research
Synthetic
Chemistry
Using our Multiple Technologies Toolbox to
Address the Soybean Nematode Problem
• Bayer Investor Presentation • Meet Management • June 2015 Page 157
Approx. 12% world crop production is lost due to nematode damages,
accounting for a value of US$100 billion per year*
Soybean cyst nematodes (SCN) are now found throughout the soybean
growing areas in both the USA and Brazil, impacting vigor and yield
High need for new modes-of-action and new approaches
Bayer CropScience
Chemicals Biologicals Traits Breeding
SCN trait Germplasm
improvements
• Nematicide
• Chemical: fluopyram
• Launched 2015 in
soybeans (ILeVO)
• Seed treatment
• Biological: Bacillus firmus
• Chemical: clothianidin
• Launched 2011
• Technical Proof-of-
Concept demonstrated
• Effective against all
major varieties of SCN
• In development
• Collaboration with
Natural Source
Genetics
• In development
*All host crops combined
CropScience Innovation Pipeline 2014-2019
with Combined Peak Sales Potential > €5bn
• Bayer Investor Presentation • Meet Management • June 2015 Page 158
New launches Planned launches*
2014 2015 2016 2017 2018 2019 Verango/Velum
Nematicide
Sivanto
Insecticide
Disease control
New mixture /
formulation
Pest control
New active
ingredient
Weed control
New mixture /
formulation
Pest control
New active
ingredient
Flocter
Biological
nematicide
Council
Rice herbicide
Disease control
Country / label
extension
Disease control
Country / label
extension
Weed control
New mixture /
formulation
Disease control
New active
ingredient
FiberMax
GlyTol + TwinLink
cotton
Movento
Country / label
extension
Weed control
Country / label
extension
Weed control
Country / label
extension
Disease control
New mixture /
formulation
InVigor
Canola pod shatter
reduction
Alion
Country / label
extension
Oilseeds
Improved canola oil
profile
Cotton
Dual HT + IR
Soybeans
Triple HT
Arize
Bacterial Leaf
Blight resistant rice
Wheat
Non-hybrid wheat
seed (Ukraine)
Oilseeds
Dual HT canola
Oilseeds
Dual HT canola
Soybeans
Dual HT
Rice
Insect resistance +
disease resistance
Oilseeds
HT Ogura hybrid
Rice
Disease resistance
+ salinity tolerance
Rice
Disease tolerance
Rice
Disease resistance
+ submergence tol.
Soybeans
Dual HT
*subject to regulatory approval
**includes selected native traits
Major Life Cycle Innovation
Chemical Crop Protection
Biological Crop Protection
Seeds & Traits**
HT: Herbicide tolerance trait
IR: Insect resistance trait
More than 100 Life Cycle Management projects
Several hundred new varieties in vegetables and broad acre crops
Key Launches in 2014
• Bayer Investor Presentation • Meet Management • June 2015 Page 159
• Fluopyram nematicide
• Outstanding nematode efficacy with broad crop spectrum at very low
dose rates
• Unique efficacy against sudden death syndrome in soybeans
• Bacillus firmus I-1582 - Soil Application
• Multiple modes-of-action with direct and indirect activity against main plant
parasitic soil nematodes
• Increase of plant vigor, root health and crop yield
• Non GM solution to pod shatter reduction in Bayer canola and rapeseed
• Improved grain yield, oil content and oil quality by allowing later maturity and
reducing seed shattering
• The first double herbicide tolerance (Glyphosate and Glufosinate) +
Dual Bt insect resistance product
• Foundation product of proprietary cotton trait portfolio
• Launched in USA & Brazil
Pod
shatter
+
• Bayer Investor Presentation • Meet Management • June 2015 Page 160
Significant benefits to growers
quick feeding cessation
effective virus vector control
flexible applicability at any crop stage
higher-quality produce at harvest
Outstanding safety profile
Use in fruits, vegetables and
selected broad-acre crops
Resistance management by novel
butenolide chemistry (flupyradifurone)
Available in the US for 2015 growing
season; EU registration expected in
2016
Key Launches 2015: Sivanto – A Premium
Insecticide for Fruit and Vegetable Growers
Key Launches 2015: Council – A Low-Dose
Rice Herbicide Family for Asia Pacific
Based on innovative active ingredient triafamone
Controls a variety of important weeds and sets a
new standard for efficient Echinochloa control
Can be used in direct seeded or transplanted rice
from seeding or transplanting to late post-
emergence
High productivity for the grower as a result of
saved costs, labor, time and water
Favorable environmental profile and good crop
safety
Not cross-resistant to conventional ALS-chemistry
First launch in Korea in 2015 in combination with
HPPD herbicide tefuryltrione as Council® complete
Launch in other major rice-growing countries
to follow
• Bayer Investor Presentation • Meet Management • June 2015 Page 161
Triafamone ALS inhibitor
Contrary to rice, in weeds a metabolite is
formed which strongly inhibits ALS, the
branched-chain amino acid synthesizing
enzyme. Amino acids are the "building
blocks” for proteins for plant growth and
development of a plant.
Resistant Echinochloa crus-galli
in Thailand
ALS product 1 ALS product 2
ALS = Aceto-lactate-synthase
HPPD = p-hydroxyphenyl-pyruvate-deoxygenase
Exploiting the Full Potential of our Portfolio
with Life Cycle Management (LCM)
• Bayer Investor Presentation • Meet Management • June 2015 Page 162
Potential
Significant returns beyond first patent expiry
10 major LCM innovations to be launched 2014 – 2019*
More than 100 LCM projects currently ongoing in R&D
Expertise
Longer & More
Registrations in new crops / countries / pests / diseases
Customer-centric innovation beyond the product / molecule
New mixtures / technologies / patents
Strong Life-Cycle Management expertise
Broad portfolio base for new mixing partners
State-of-the-art technology platforms
*subject to regulatory approval
Example: Fungicide Trifloxystrobin
Life-Cycle Management Generates Returns
Beyond Patent Expiry
• Bayer Investor Presentation • Meet Management • June 2015 Page 163
2001 2003 2005 2007 2009 2011 2013
A.I. patent expiry
Nativo brand family
Other brands
Innovative mixtures with IP Examples: Fox, Stratego Yield
Efficiency gains by production
process optimization
Explore product properties
beyond efficacy Examples: yield, quality,
abiotic stress
Develop integrated crop solutions Example: Much More Rice
Key Activities
Sales
• Insecticide family
• Lead A.I.:
Flubendiamide
• Controls lepidoptera
pests in a wide range
of crops, incl. corn
soybeans and cotton
• High demand due to
helicoverpa pest
pressure in LatAm
€500m
€2 - 2.5bn Combined Peak Sales Potential
From 3 Major Established Brand Families
• Bayer Investor Presentation • Meet Management • June 2015 Page 164
• Fungicide family
• Lead A.I.:
Trifloxystrobin
• Control of soybean
rust and many other
fungal diseases
• Highly effective all-in-
one solution
• Increased plant
health effects
€1- 1.5bn
• Fungicide family
• Lead A.I.:
Prothioconazole
• Main crops: cereals
and corn
• Helps to maximize
growers profit by
protecting grain
quality and yield
> €500m
32%
27%
21%
7%
5% 8%
Vegetables Canola CottonSoybean Rice Other
FY 2014 – Seeds Sales Above €1bn For
The First Time
• Bayer Investor Presentation • Meet Management • June 2015 Page 165
687
820
974
1,104
2010 2011 2013 2014
+13% CAGR
€1,104m
By crop € million
Seeds sales
Building a Soybean Business in the Key
Growth Regions
• Bayer Investor Presentation • Meet Management • June 2015 Page 166
Measures Taken Market Entry
• 9 breeding centers operating,
3 more under construction
• Numerous recent acquisitions
• Significant R&D investments
• Strong integrated offer with attractive
crop protection portfolio (e.g. Belt,
Liberty and Fox)
• Aim to repeat cotton/canola success
• Addressing market needs (e.g. Asian
soybean rust, herbicide tolerance,
nematodes)
• Bayer soybean brand Credenz
launched 2014 in the US; launch in
Latin America in preparation
Well positioned to become a leading soybean player in Latin America
Building a Global Wheat Seed Business –
Largest Broad-Acre Crop Worldwide
• Bayer Investor Presentation • Meet Management • June 2015 Page 167
• 7 wheat breeding centers operating
• €1.5bn R&D investment 2010 – 2020
planned for crop protection and seeds
• Acquisition of superior germplasm
• Numerous alliances
• Bayer is a global leader in crop
protection solutions in cereals
• First Bayer wheat seed currently
launching in the Ukraine
• Open pollinated variety
• Hybrid seed varieties, providing
opportunity for both yield increase
and improved yield stability, expected
after 2020
Market value still small - major potential seen with productivity improvement
Measures Taken Market Entry
Well Positioned to Address Customer Needs
with Agriculture Innovation
• Bayer Investor Presentation • Meet Management • June 2015 Page 168
Integrated R&D Approach with State-of-the-art
Enabling Technologies
Multiple Technologies for Agriculture Innovation:
Chemicals, Biologicals, Traits, Breeding
Full Exploitation of Portfolio Value by Life Cycle
Management
Promising Pipeline with Peak Sales Potential > €5bn*
*Combined peak sales potential from expected launches
2014 – 2019; subject to regulatory approval