Bayer looks to the future

Bayer, in its first year without its Lanxess bulk chemicals operation, saw sales and earnings climbing strongly in the first three months of 2005, according to chairman Werner Wenning, speaking at the company’s annual stockholders meeting.

Sales from continuing operations increased 15.7% to €6.7billion, he said; adjusted for exchange rate fluctuations and portfolio adjustments, this represents a 9.3% increase. The operating result showed a 50.1% increase, to €1.1billion.

For the year as a whole, the company is aiming for a 5% increase in sales on a like-for-like basis, to around €25billion. ‘We have got off to a very good start in 2005, and that confirms our optimistic forecast for the full year,’ Wenning told shareholders.

As befits a company focused on healthcare and high-tech materials, Bayer is placing increasing importance on R&D for the coming years. In the pharmaceutical field, it has a compound in phase II clinical trials for kidney cancer, and plans to launch the product, sorafenib, in the US next year. It also has a product which reduces blood loss in surgery in phase III trials, and plans to begin phase III trials for a once-daily dose of a factor Xa inhibitor to treat blood clotting-related disorders later this year.

Bayer is also using its expertise in polycarbonates in the development of Blu-ray, the next generation of compact disc-based data storage media, and is collaborating with a US firm, In-Phase, on a polycarbonate-based holographic storage medium with capacities up to 1.6 terabytes.

Wenning said that biotechnology is likely to be of special importance to Bayer; it is also likely to have the greatest influence on process technologies. The company is exploring its use to produce renewable raw materials, such as proteins from plants to use in medicines, and other compounds which could be used to make plastics.

However, he said, the environment for research may not be ideal in Germany. ‘It is essential that the political community sets priorities, creates the necessary framework and provides the kind of incentives that exist in other countries,’ he said.