Bayer sees 'enormous' advantage in treating both crops and humans

Bayer CEO Marijn Dekkers

Drugmakers such as Novartis ($NVS) and Sanofi ($SNY) long ago bowed out of the crop science field, bidding farewell to their units to focus their attention on pharma. But the way Bayer sees it, the area is an important piece of the life sciences puzzle.

As the German pharma gears up to hive off its plastics division, it's hanging onto CropScience--its fastest-growing unit--and looking for the overlap between that business and HealthCare, Bloomberg reports.

Take nematodes, tiny worms that attack peanut and cotton roots. In developing a pesticide, Bayer's scientists found that blocking the delivery of oxygen to the worms yielded a pathway that could be explored as a way to cure people and pets. Now, Bayer researchers are working to see if it can stifle skin cancer in humans and heartworm in dogs, much the same way it stifles nematodes.

"Even though a plant and a human look different, many mechanisms at the cellular level are driven by the same fundamental chemistries," CEO Marijn Dekkers told Bloomberg. "Which species it happens to be is actually not so important."

The strategy has had its critics--like former Novartis chief Daniel Vasella, who led his company out of the field back in 2000. But "Bayer was stubborn and didn't do that," Dekkers told the news service, "and in my mind, this will be an enormous advantage."

Of course, the cross-species strategy still has a ways to go to prove itself; much of what Bayer is working on may take years to enter clinical trials, Bloomberg notes. But there are other reasons to keep CropScience around.

Even despite Bayer's new powerhouse pharma launches--like clot-fighter Xarelto and eye drug Eylea--it's CropScience, not HealthCare, that's expanding quickest. And as Union Investment Luxembourg fund manager Markus Manns told Bloomberg, the units balance each other out--risk-wise and growth-wise--and help protect against takeovers.

"The synergies between pharma and crop science are minimal, especially in the area of research and development," he said. "There are definitely more synergies between animal and human health, but not many."

Meanwhile, reports say the Leverkusen-based company is holding investor meetings this summer, getting shareholders' take on timing for its plastics IPO. The offering could value the new company, to be dubbed Covestro, at €10 billion--and it might hit the public markets in October, with Bayer turning the unit into a legally separate and self-contained entity by Sept. 1.

- get more from Bloomberg

Special Reports: The top 15 pharma companies by 2014 revenue - Bayer | Top 15 Drug Launch Superstars - Eylea - Regeneron and Bayer HealthCare - Xarelto - Bayer and Johnson & Johnson

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