Bayer counts on consumer health, pharma growth to power 2015

Bayer's new pharma launches may be soaring, but that wasn't enough to help the German drugmaker meet analysts' profit estimates for Q4. For 2015, the company expects bigger things--but as it moves forward with plans to bid farewell to its plastics unit and competition ramps up for its best-sellers, its consumer health division will need to start pulling its weight.

Q4 earnings sank to €224 million ($254 million), compared with €455 million in the year-ago period. Analysts had expected net profit to climb to €483 million, according to The Wall Street Journal--a miss Bayer blamed in part on costs related to its $14.2 billion pickup of Merck's ($MRK) OTC unit.

Bayer CEO Marijn Dekkers

It's not a performance CEO Marijn Dekkers foresees his company repeating. Bayer said Thursday that it predicts adjusted earnings before EBITDA will expand by between 10% and 15% this year on the back of a strong U.S. dollar and growing sales of its top 5 drugs.

Speaking of those 5--blood thinner Xarelto, eye drug Eylea, cancer meds Stivarga and Xofigo, and pulmonary arterial hypertension treatment Adempas--their sales haul will approach €4 billion, Bayer figures, a substantial leap from this year's €2.9 billion tally.

But as Dekkers pointed out in an interview with Bloomberg Television's "Surveillance," Bayer doesn't "aspire to be a pure pharma company" even as it prepares to home in on life sciences. After it divests its plastics business--which could happen through IPO, spinoff or even a sale, if the price is right, Dekkers noted Thursday--it'll still have less risky, patent-dependent businesses to lean on--like consumer health, for instance.

And despite a fourth-quarter OTC showing that analysts found not quite up to par, No. 2 worldwide player Bayer is optimistic about its future in a field where size matters.

"This is the first quarter after an acquisition … It's a transition situation," Dekkers pointed out to Bloomberg TV. "In OTC, critical size actually makes a difference. You go into a drug store and it's about shelf space. Now, we have products like Claritin, Aleve and Aspirin all next to each other, and that is a tremendous advantage."

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