Bayer Ag · XETR:BAYN
Bayer — Investor Day (March 2021)
35 slides from Bayer's investor day presentation, Mar 10, 2021
Slide 1: Transforming Pharma to Deliver Sustainable Long-term Growth
Transforming Pharma to Deliver Sustainable Long- term Growth /////////// Capital Markets Day March 10-11, 2021 Stefan Oelrich President of the Pharmaceuticals Division Marianne De Backer Head of Strategy and BD&L Pharmaceuticals Christian Rommel Head of R&D Pharmaceuticals 1 /// Bay er Capital Marke
Slide 2: Cautionary Statements Regarding Forward-Looking Information
Cautionary Statements Regarding Forward-Looking Information This presentation may contain forward-looking statements based on current assumptions and forecasts made by Bayer management. Various known and unknown risks, uncertainties and other factors could lead to material differences between the ac
Slide 3: Pharma: Focused on Therapeutic Areas with High Unmet Needs
1 Overview Pharma: Focused on Therapeutic Areas with High Unmet Needs Sales development EBITDA margin development Sales by region In €m In %, before special items In %, in 2020 17,962 17,243 16,420 16,847 16,746 North 33.9 34.9 America 22 33.4 32.0 32.6 40 EMEA Latin 5 America 33 2016 2017 2018 2019
Slide 4: We are Operating in a Rapidly Changing but Attractive Market Environment
2 Pharma Mark et We are Operating in a Rapidly Changing but Attractive Market Environment Pharma Market Market Dynamics Market Size 20201 Opportunities Japan • Rising life expectancy and increased access to China healthcare systems 7% APAC 8% • Accelerated digital transformation across the 9% value
Slide 5: The Transformation of Pharma is Underway
3 Strategy The Transformation of Pharma is Underway New management team focused on improving existing structures and processes Realize full potential of products and pipeline to mitigate LoE impact and return to growth Re-allocate resources and shape financial profile to post LoE future Capitalize a
Slide 6: Our Transformation is Guided by Five Strategic Focus Areas
3 Strategy Our Transformation is Guided by Five Strategic Focus Areas Strategic Focus Areas Portfolio and Digital He alth Ce ll & Ge ne Oncology China & US Pipe line The rapy Key Priorities Maximize the value of the current portfolio and manage the loss of exclusivity for Xarelto & Eylea Deliver
Slide 7: Xarelto and Eylea are on Track to Deliver Peak Sales Potential
4 Xarelto & Eylea Xarelto and Eylea are on Track to Deliver Peak Sales Potential Xarelto Eylea €bn €bn 2.5 2.5 4.5 4.1 2.2 3.6 1.9 3.3 2.9 1.6 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 • Peak sales potential > €5bn • Peak sales potential > €2.5bn • Strongest real-world experience • Leveragin
Slide 8: Xarelto's Loss of Exclusivity Will be Staggered Over Several Years
4 Xarelto & Eylea Xarelto´s Loss of Exclusivity Will be Staggered Over Several Years Xarelto´s main patent expirations Xarelto sales by main markets Effective Region Patent Other regions USA Duration China Compound patent 2020 12% 11% Japan Compound patent 2022-2025 Germany 11% Japan 11% Europe Comp
Slide 9: Historic Genericization Patterns of Small Molecules Reveal Most Pronounced LoE Impact in the US
4 Xarelto & Eylea Historic Genericization Patterns of Small Molecules Reveal that the most Pronounced LoE Impact Occurs in the US Standard Units Atorvastatin (Lipitor™) Standard Units Clopidogrel (Plavix™) Valsartan (Diovan™) Standard Units 120% 120% 120% 100% 100% 100% 80% 80% 80% 60% 60% 60% 40% 4
Slide 10: Bayer's Long-Term Sales Projection Reveals Limited LoE Impact and Return to Growth
4 Xarelto & Eylea Bayer´s Long-Term Sales Projection Reveals Limited LoE Impact and Return to Sustainable Long-term Growth Value maximization Xarelto LoE Return to sustainable growth Trough 2020 expected in Bayer Pharma Sales: €17.2bn 2024 Sales Projection Margin1: 35% Market Estimate2 2020 2021 202
Slide 11: We Laid The Foundation for Long-term Growth at Pharma
5 Growth Drivers We Laid The Foundation for Long-term Growth at Pharma Main Building Blocks of Post LoE Growth 1 Late-stage Pipeline Finerenone Elinzanetant in CV & WH (KaNDy NT-814) Oncology Pipeline eg. EGFRexon20 inhib., ATR inhib., TTCs C> platform expected to deliver Cell & Gene Therapy signi
Slide 12: Christian Rommel
Christian Rommel Head of Pharma R&D 12 /// Bay er Capital Markets Day /// Transforming Pharma to Deliver Sustainable Long-term Growth /// March 10-11, 2021
Slide 13: A Successfully Matured Late-stage Pipeline May Deliver Three New Potential Blockbusters
6 R&D A Successfully Matured Late-stage Pipeline May Deliver Three New Potential Blockbusters Nubeqa (Darolutamide)1 Finerenone Elinzanetant AR-Antagonist MR-Antagonist Dual NK 1,3 Receptor-Antagonist • Launched in nmCRPC - global roll- • Significant reduction of renal and • First-in-class oral, non
Slide 14: Peak-sales Potential of Key Late-stage Pipeline Assets
6 R&D Peak-sales Potential of Key Late-stage Pipeline Assets 2018 2021 Peak Sales New: Peak Sales Pipeline Asset Pipeline Asset Potential Elinzanetant Potential Nubeqa1 ≥ €1bn (KaNDy NT-814) Nubeqa1 ≥ €1bn (Darolutamide) (Darolutamide) Finerenone ≥ €1bn Finerenone ≥ €1bn Vitrakvi > €750m Elinzanetan
Slide 15: Our Pipeline Comprises Attractive Late-/mid-stage Opportunities and Early Assets
6 R&D Our Pipeline Comprises Attractive Late-/mid-stage Opportunities and Scientifically Appealing Early Assets Late-/mid-stage Opportunities1 ScientificallyAppealing Early Assets1 Finerenone Precision Molecular Oncology • CKD in T2 Diabetes Patients • EGFRex20 inhibitor • Heart Failure • ATR inhibi
Slide 16: We Enhance our Focus on External Innovation and Collaborate with Partners
6 R&D We Enhance our Focus on External Innovation and Successfully Collaborate with Partners Selected R&D Collaborations • Pipeline replenishment is key imperative Cardiovascular Diseases Cardiometabolic risk partnership • Collaborating with top academia, pharma partners and biotech companies EMR >5
Slide 17: Transforming Major Elements Along the Value Chain and Capitalizing on Digital Health
7 Digital Transforming Major Elements Along the Value Chain and Capitalizing on a Growing Digital Health Portfolio Research Clinical Development Digital Health Business Opening up new frontiers and Enhance efficiency, insights, Providing integrated solutions increasing speed in and patient outcomes
Slide 18: Marianne De Backer
Marianne De Backer Head of Pharma Strategy and Business Development & Licensing 18 /// Bay er Capital Markets Day /// Transforming Pharma to Deliver Sustainable Long-term Growth /// March 10-11, 2021
Slide 19: External Innovation to Accelerate Replenishment of Pipeline and Broaden Modalities
8 External Innovation External Innovation to Accelerate Replenishment of Pipeline and Broaden Modalities Selected high-level overview Momentum Significantly Increased >25 Transactions signed in 2020 • Deals covering the entire spectrum from equity investments (with LEAPS), over licensing agreements
Slide 20: Our Cell & Gene Therapy Strategy Builds on Four Integrated Platforms
8 External Innovation Our Cell & Gene Therapy Strategy Builds on Four Integrated Platforms to Drive the Next Wave of Innovation at Pharma Gene Augmentation Stem Cells Allogeneic Cell Therapy Collaboration with Atara Biotherapeutics • Industry-leading AAV • Creating induced • Next-generation, vector
Slide 21: Comprehensive Cell & Gene Therapy Pipeline that Has Proven Ability to Yield Commercial Assets
8 External Innovation Comprehensive Cell & Gene Therapy Pipeline that has Proven Ability to Yield Commercial Stage Assets Estimated primary Project Discovery Preclinical Phase I/II study completion3 Pompe Disease - Gene Therapy Dec 2022 Parkinson’s Disease - Gene Therapy Dec 2022 Congestive Heart Fa
Slide 22: Disciplined Investment in BD&L Delivered Top-ranked M&A-Transactions
8 External Innovation Disciplined Investment in BD&L Delivered Top-ranked M&A-Transactions #8 of the top 10 largest #6 & #19 of the top 20 #1 in Pharma AI biopharma M&A deals in 20201 biopharma M&A deals in 20202 Transactions 20203 1. AstraZeneca / Alexion Pharma 1. AstraZeneca / Alexion Pharma 1. B
Slide 23: Stefan Oelrich
Stefan Oelrich President Pharmaceuticals 23 /// Bay er Capital Markets Day /// Transforming Pharma to Deliver Sustainable Long-term Growth /// March 10-11, 2021
Slide 24: We Doubled the Portfolio in Oncology since 2015 and Delivered Innovation to Patients
9 Oncology We Doubled the Portfolio in Oncology since 2015 and Delivered Innovation to Patients Key Oncology Products Delivering Innovation Differentiated androgen receptor antagonist Tumor-agnostic precision medicine Pan-PI3K inhibitor in lymphoma Alpha-radio-pharmaceutical 2nd-line treatment of HC
Slide 25: We are Targeting to Significantly Expand our Presence in Select Areas of Oncology
9 Oncology We are Targeting to Significantly Expand our Presence in Select Areas of Oncology where One Blockbuster can Build a Franchise Key elements to achieve our growth aspiration • Realize blockbuster potential of NUBEQA • Expand prostate franchise with NUBEQA and Xofigo • Continue to execute la
Slide 26: Evolving Our Regional Strategies to Address Portfolio Imbalance Relative to the Market
10 Regional Strategy Evolving Our Regional Strategies to Address Portfolio Imbalance Relative to the Market • Europe & China centric Pharma business 2020 2020 • Lacking US-rights for Xarelto & Eylea €17.2bn ~€1,000bn Other 10% 11% • Portfolio evolution to balance the business 5% geographically LatAm
Slide 27: China is the 2nd Largest Pharmaceutical Market Globally and Remains Attractive
10 Regional Strategy China is the 2nd Largest Pharmaceutical Market Globally and Remains an Attractive Growth Opportunity Emerging local biotech bring Strong market fundamentals due assetTop 5 Pharma opportunities countries but also to rising but still low disease competition to multinational diagno
Slide 28: Sustaining Future Growth in China Through Innovation and Volume Opportunity
10 Regional Strategy Sustaining Future Growth in China Through Innovation while Leveraging Significant Volume Opportunity in Established Products Drive volume expansion in Leverage growth opportunity with established product portfolio innovation-based portfolio • Established product portfolio affect
Slide 29: Sustainability is Fully Embedded in our Strategy
11 Sustainability Sustainability is Fully Embedded in our Strategy Providing 100m women in LMIC1 with access to modern contraception Bayer Capacity • “Health for All - Hunger for None” are core to Products building2 our raison d´être at Pharma 100 • Measurable targets linked to incentive scheme ~ 38
Slide 30: Mid-term Targets for Pharma Reflect Limited Impact from the LoE for Xarelto
12 # Financial FinancialsTargets Mid-term Targets for Pharma Reflect Limited Impact from the LoE for Xarelto Sales / Sales Growth Divisional Drivers act At constant At month-end Dec’ 20 rates² currencies 1 2020 2021e 2021e 2022/2023e 2024e • Top-line trough due to Xarelto LoE 18.8 expected in 2024 -
Slide 31: Key Takeaways for Pharma
13 Conclusion Key Takeaways for Pharma 1 The transformation of Bayer Pharma is underway We expect limited impact from the LoE of Xarelto and laid the foundation for 2 long-term growth thereafter 3 We target to launch three new potential blockbuster products Established a C>-platform and continue t
Slide 32: Experienced Pharma Leadership Team
14 Leadership Team Experienced Pharma Leadership Team Stefan Oelrich President, Pharmaceuticals Christoph Bertram Marianne De Backer Michael Devoy Reinhard Franzen Strategy, Business Medical Affairs & Human Resources Commercial Operations EMEA Development & Licensing Pharmacovigilance Sebastian Guth
Slide 33: Transforming Pharma to Deliver Sustainable Long-term Growth
Transforming Pharma to Deliver Sustainable Long- term Growth /////////// Capital Markets Day March 10-11, 2021 Stefan Oelrich President of the Pharmaceuticals Division Marianne De Backer Head of Strategy and BD&L Pharmaceuticals Christian Rommel Head of R&D Pharmaceuticals 33 /// Bay er Capital Mark
Slide 34: Appendix: Abbreviations (1/2)
Appendix: Abbreviations (1/2) A Actuals EMEA Europe, Middle East and Africa AAV Adeno-associated virus EMR Endocrinology, Metabolic Dysregulation, Reproductive Health AI Artificial intelligence EU5 France, Germany, Italy, Spain, United Kingdom APAC Asia Pacific FDA U.S. Food and drug administration
Slide 35: Appendix: Abbreviations (2/2)
Appendix: Abbreviations (2/2) MR Mineralocorticoid receptor MSLN Mesothelin NK Neurokinin nmCRPC Non-metastatic castration resistant prostate cancer NOAC New oral anticoagulant OS Overall survival p.a. Per annum Pan-PI3K Pan-class phosphatidylinositol 3-kinase Ph Phase R&D Research & Development T2