Bayer CEO Werner Baumann says company is 'putting major litigation behind us' while highlighting Q2 growth
Bayer CEO Werner Baumann highlighted “strong operational performance” on Thursday while raising the full-year guidance. But before diving into the details, he summarized Bayer’s plan to settle a slate of ongoing litigation.
“We are making good progress in putting major litigation behind us,” Baumann said on a Q2 call with investors and analysts.
He added that the company is “confident in the litigation strategy” when it comes to glyphosate, the active ingredient in the weedkiller Roundup. Bayer has faced multiple cases alleging that Roundup caused cancer, and recently announced a five-point plan to “a clear path to closure of the U.S. glyphosate litigation.”
The company has already settled 107,000 of 138,000 cases, according to its website.
“From today’s perspective, we are sufficiently provisioned to deal with the current and also the future cases,” Baumann said.
Bayer has faced scrutiny since closing $30 billion in valuation after its $63 billion buyout of US agricultural giant Monsanto in 2018.
As for lawsuits alleging Monsanto and other companies should be held responsible for environmental impacts from carcinogenic chemicals called polychlorinated biphenyls (PCBs), Bayer said a class action settlement is likely coming in Q4.
“The opt out period for the class settlement recently expired and we expect to finalize the national class action settlement in quarter four,” Baumann said.
He also said an arbitration ruling is expected soon in its case with BASF, which claimed Bayer didn’t fully disclose personnel costs when it negotiated assets from the crop science portfolio.
“We expect the decision by the arbitral tribunal to be issued shortly,” the company said.
As for the pharma business, sales were slightly up thanks to gains from Eylea, Bayer’s vascular endothelial growth factor (VEGF) inhibitor used to treat several eye-related conditions, including neovascular (wet) age-related macular degeneration (AMD), macular edema following retinal vein occlusion (RVO), diabetic macular edema (DME) and diabetic retinopathy (DR).
Eylea earned roughly $826 million last quarter (€807 million), up from $728 million (€711 million) in Q2 of 2021.
Bayer maintained its confidence in Eylea despite the emergence of competitors, including Roche’s two products Susvimo and Vabysmo. Back in May, a Spherix study revealed that while most ophthalmologists have heard of Susvimo, a majority of the respondents said they’d turn to Eylea as a safer and more accessible option.
However, Bayer noted that pharma growth was held back by “price- and volume-related declines for Xarelto that were largely due to tender procedures in China and the expiration of our patent in Brazil.”
Xarelto earned roughly $1.1 billion (€1.1 billion) in Q2, down slightly from the nearly $1.2 billion it raked in for the second quarter last year.
Consumer health sales were up 6.8% this quarter, largely driven by a 17% growth in allergy and sales as a higher number of cold incidents occurred due to less social distancing, the company said.