A busy morning for Bayer has seen the German group unveil a healthy set of financials for the third quarter and announce a $1.2 billion acquisition of US vitamins firm Schiff Nutrition International.
First to the figures and turnover rose 5.5% (currency and portfolio adjusted) to 9.67 billion euros. However, net income was down 17.8% to 528 million euros, due in part to charges connected to restructuring and litigation concerning the Yaz/Yasmin (drospirenone and ethinyl estradiol) contraceptive franchise.
Bayer Healthcare turnover was up 5.5% to 4.72 billion euros, with pharmaceutical revenues increasing 6.1% to 2.42 billion euros. Growth was achieved mainly in North America (+11.0%) and the emerging markets, especially China. while European sales edged up 0.5%.
Mirena, the firm’s levonorgestrel-releasing intrauterine contraceptive system, was a big riser, up 22.5% to 183 million euros, while Bayer's best-seller was Betaferon/Betaseron (interferon beta 1b) for multiple sclerosis, down 6.1% to 292 million euros. The haemophilia agent Kogenate (recombinant antihaemophilic factor) rose 8.9% to 300 million euros, while the Yaz franchise fell 4.0% to 277 million euros.
Nexavar (sorafenib), which is approved for liver as well as advanced kidney cancer, contributed 199 million euros, up 4.2%, while the erectile dysfunction drug Levitra (vardenafil) slipped 1.9% to 75 million euros. The anticoagulant Xarelto (rivaroxaban), which Bayer believes will be its key earnings driver, contributed 81 million euros, up from 20 million euros in the like, year-earlier period.
Schiff buy boosts presence in USA
The Leverkusen-headquartered group is also paying about $1.2 billion, or $34 per share to get hold of Schiff and its vitamins and nutritional supplements.
The Schiff portfolio includes "strong brands in three of the largest health supplement segments", such as joint care (Move Free), cardiovascular health (MegaRed) and immune support (Airborne), among others. These products "complement Bayer’s existing over-the-counter portfolio and will allow it to provide consumers with a broad range of options", the firm said.
Schiff had sales of $259 million for its fiscal year ended May 31 and expects that figure to rise 43%-46% for this year. The company employs 400 people and has its headquarters and manufacturing site in Salt Lake City.
Bayer chief executive Marijn Dekkers (pictured) said Schiff "significantly enhances our presence and position in the USA, which accounts for more OTC and nutritional products sales than any other country in the world". He added that the company's primary goal is "to grow organically on the basis of our innovative capability [but] we are supplementing this with targeted small to mid-size acquisitions in the life sciences".