Poor Bayer HealthCare. Its new drugs and modest sales growth couldn't make up for lagging sales and soaring costs at Bayer's plastics business. Announcing its first-quarter results, Bayer Group understandably leaned on its healthcare unit's strengths, but headlines focused on the German company's overall disappointments: profits up only 0.4%, sales up just 2.1%, both below analyst expectations.
And while the healthcare business's sales outgrew the group, thanks to increases for its new products, some older drugs didn't do so well. As Bloomberg notes, the Yaz contraceptive line took a 15.6% hit, to €206 million in sales; the birth control pill have been flagging on safety worries as the company fights lawsuits over their blood-clotting risks. The company's sclerosis drug Betaseron fell 8% on new competition, and Avelox slid by 12.2% to €115 million. The cancer drug Nexavar faltered, too, with a 7% decline to €173 million.
"They missed expectations," Helvea analyst Odile Rundquist told Bloomberg, though newly launched products Eylea, an eye treatment, and Stivarga, a cancer treatment, both did well, with €49 million and €40 million in respective sales. After strong pharma growth in 2012, the setbacks hurt.
And those declines were a big drag on growth in Bayer's new meds--particularly the anticoagulant Xarelto, which hit its stride with €155 million in sales, more than triple last year's sales level. Overall, pharma sales rose a bit, to €2.57 billion, and together with an uptick in consumer health, the healthcare group managed €4.44 billion in sales, or about $5.8 billion.
Still, that's pretty decent in a quarter marked by big sales declines at many drugmakers--consider AstraZeneca ($AZN) and Bristol-Myers Squibb ($BMY), each of which announced severe, albeit expected, revenue losses today. If Bayer can succeed in expanding Xarelto's indications further, and Eylea and Stivarga continue their upward march, perhaps next quarter will be more decent still.
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