Bayer Charts New Growth Path: FDA Priority for Kerendia, Billion-Dollar Eye Deal, and Strong Q1 Earnings

Bayer secures FDA Priority Review for Kerendia in type 1 diabetes and CKD, and acquires Perfuse Therapeutics for up to $2.45B to counter Eylea patent loss, backed by strong Q1 earnings.

Bayer is executing on two fronts to secure its pharmaceutical future. The German group has secured an FDA Priority Review for Kerendia in a new indication while simultaneously spending up to $2.45 billion to acquire US biotech Perfuse Therapeutics. The moves come as the company works to offset the looming patent loss on its top-selling drug Eylea and manage a multi-front legal battle.

The FDA on May 21 accepted Bayer’s supplemental application for Kerendia (finerenone) in adults with type 1 diabetes and chronic kidney disease. The agency granted Priority Review on the back of the phase 3 FINE-ONE trial, which showed a 25% reduction in the urine albumin-to-creatinine ratio (UACR) over six months versus placebo when added to standard care. Some 68.1% of treated patients achieved a UACR drop of at least 30%, compared with 46.6% in the placebo arm. UACR is a key predictor of kidney disease progression, giving the data weight beyond a simple symptom readout.

FINE-ONE marks the fifth consecutive positive phase 3 outcome in Bayer’s finerenone program, which already includes the FIND-CKD trial in non-diabetic chronic kidney disease reported in March 2026. Bayer plans to file that data with the FDA as well. Additional pooled evidence from the FIDELIO-DKD and FIGARO-DKD trials, both in type 2 diabetes patients, further bolsters the Kerendia dossier. Beyond the nephrology pipeline, Bayer has also submitted asundexian for stroke prevention based on the OCEANIC-STROKE study.

A $2.45 Billion Bet on the Eye

The Perfuse acquisition addresses an even more immediate commercial threat: the 2027 patent cliff for Eylea, which generated €3.11 billion in sales for Bayer in 2025. Under the deal, Bayer pays $300 million upfront and up to $2.15 billion in milestones tied to development, regulatory approvals, and commercialization of PER-001, an implant for glaucoma and diabetic retinopathy.

Phase 2a data for PER-001 are encouraging. In the glaucoma arm, 37.5% of high-dose patients improved their visual field by at least 7 decibels; no such improvement was seen in the control group. For diabetic retinopathy, contrast sensitivity rose by 0.9 dB in the treatment group while falling by 2.1 dB in the comparator. With roughly 146 million people worldwide suffering from diabetic retinopathy and glaucoma cases expected to hit 112 million by 2040, the market opportunity is substantial.

The acquisition is Bayer's biggest pharma purchase since 2021 and comes at a time when Eylea’s US sales are already slipping, down 10% in the first quarter to $941 million.

Stronger Profit, Heavier Cash Burn

The pipeline news landed against a solid quarterly backdrop. Bayer’s first-quarter 2026 group revenue reached €13.405 billion, up 4.1% on a currency-adjusted and portfolio-adjusted basis. EBITDA before special items climbed 9.0% to €4.453 billion. Core earnings per share came in at €2.71, comfortably above the consensus estimate of €2.28. Adjusted earnings per share, using a different definition, doubled to €2.81, while net profit surged 116% to €2.81 billion.

Yet the legal overhang from glyphosate remains acute. The US Supreme Court is weighing Bayer’s bid to fend off tens of thousands of lawsuits, with a decision expected before the session ends in June. The financial toll is already tangible: free cash flow in the first quarter was negative €2.320 billion, including €2.002 billion in litigation settlement payments. Net debt did improve, falling 8.5% to €29.84 billion, helped by a €2 billion cost-cutting program that is starting to take effect.

Mixed Market Reception

Shares of Bayer have been volatile. On the day of the FDA and Perfuse announcements, the stock slipped 1.9% to €38.42 in Frankfurt, reflecting caution over the near-term legal and cash-flow headwinds. The DZ Bank nevertheless upgraded Bayer from Hold to Buy on May 21, raising the target price from €44 to €51, citing the strong start to 2026.

The stock remains 57.75% higher than a year ago, though it currently trades just below its short-term moving average of €38.91. Longer-term, the share price sits about 8.5% above its 200-day line, indicating that the market is slowly pricing in a brighter pipeline future.

For now, Bayer is balancing two very different narratives: a drug development engine that is gaining breadth and depth, and a legal quagmire that continues to burn cash. All eyes will be on the Supreme Court ruling in June, then on the FDA’s decision on Kerendia, and further out on whether PER-001 can replicate its early promise in pivotal trials.