Bayer Faces Challenges as Xarelto Sales Decline, Forecasts Pharma Growth in 2027

Bayer AG, the German pharmaceutical and life sciences company, is bracing for a challenging period as its blockbuster blood thinner Xarelto faces increasing generic competition. The company projects a significant decline in Xarelto sales for 2025 and does not anticipate growth in its pharmaceutical division until 2027.

Xarelto's Decline and Its Impact

Xarelto, Bayer's top-selling product, experienced a 15% drop in sales from 4.1 billion euros in 2023 to 3.5 billion euros in 2024. The decline is expected to accelerate in 2025, with Bayer forecasting a further decrease of between 1 billion and 1.5 billion euros. This sharp decline is attributed to patent expirations and potential "at-risk launches from generics," according to Stefan Oelrich, head of Bayer's pharmaceutical division.

The impact of Xarelto's decline is substantial, with Bayer projecting that its pharmaceutical division will "remain stable" through 2026. Oelrich stated, "We will see a sales trough for either 2025 or 2026, with our next wave of growth following latest by 2027."

Compensatory Growth and Future Outlook

Despite the challenges posed by Xarelto's decline, Bayer is seeing growth in other areas of its pharmaceutical portfolio. Notably, sales of prostate cancer treatment Nubeqa and kidney disease medicine Kerendia increased by 75% and 72% respectively in 2024. The company expects combined sales of these two products to rise from 2 billion euros in 2024 to over 2.5 billion euros in 2025.

Another key product, the eye disease treatment Eylea, showed a modest 2% increase in sales, reaching 3.3 billion euros in 2024. However, Bayer faces concerns about the upcoming loss of patent protection for Eylea in Europe.

Cost-Cutting Measures and Company-Wide Turnaround

In response to ongoing challenges, including litigation related to its Monsanto acquisition, Bayer is implementing significant cost-cutting measures. The company plans to reduce operating expenses by 800 million euros in 2025, part of a larger initiative to cut 2 billion euros in costs through the end of 2026.

CEO Bill Anderson emphasized the gravity of the situation, stating, "We see 2025 as the toughest year for our turnaround." This sentiment underscores the company's recognition of the challenges ahead and its commitment to navigating through this difficult period.