Bayer's Pharmaceutical Division Charts a Course for Growth

Bayer's pharma unit targets mid-single-digit growth from 2027, powered by Kerendia & Nubeqa, but faces patent cliffs and a pivotal Supreme Court glyphosate case.

Bayer has laid out a detailed roadmap for its pharmaceutical business through the end of the decade, aiming to navigate two significant challenges simultaneously. The company's recent Pharma Media Day provided concrete growth ambitions for 2030, showcasing impressive commercial performance alongside a defined turnaround timeline. The overall picture is encouraging, though not without its complications.

Pipeline and Performance Provide Momentum

The growth trajectory is currently being powered by two key therapies. Kerendia, a kidney disease treatment, demonstrated remarkable momentum with full-year 2025 sales soaring 79% to €829 million. Its growth accelerated sharply in the final quarter, reaching 93%. Meanwhile, the prostate cancer drug Nubeqa delivered a 57% increase in revenue, reaching €2.4 billion.

Significant regulatory support has recently bolstered Kerendia's prospects. The European Union granted an expanded approval for the treatment of heart failure, based on the Phase III FINEARTS-HF study involving approximately 6,000 patients. The drug distinguished itself as the first in its class to demonstrate statistically significant cardiovascular benefits for this indication. With an estimated global patient population exceeding 64 million individuals suffering from heart failure, the market potential is substantial.

Looking ahead, Bayer is targeting mid-single-digit sales growth for its pharma division starting in 2027. The following year, 2028, is projected to see the segment's operating margin climb toward 30%. This expansion is expected to be driven by a core portfolio of five products: Asundexian, Nubeqa, Kerendia, Beyonttra, and Lynkuet. The development pipeline remains robust, containing ten candidates in Phase III trials. The year 2025 alone saw three new product approvals and six positive pivotal study readouts.

Patent Expiries and Legal Proceedings Present Headwinds

The path to sustained growth is not without obstacles. The company anticipates that 2026 will not be a growth year for the pharmaceutical segment. This is due to the gradual decline of older products, specifically the anticoagulant Xarelto and the original formulation of eye treatment Eylea. The patent for Eylea is set to expire in 2027. Bayer's strategy involves offsetting these headwinds over the medium term with its new growth drivers, a transition that will require time to execute.

A separate and major overhang remains the ongoing glyphosate litigation. The U.S. Supreme Court is scheduled to hear arguments in the Durnell case on April 27, which will address the foundational legal theory for future Roundup lawsuits. A ruling in Bayer's favor could potentially nullify thousands of pending claims. The final decision is expected in the latter half of June, meaning this uncertainty will continue to cloud the investment narrative for now.

Prior to the Supreme Court hearing, Bayer will hold its Annual General Meeting on April 24. Shareholders will vote on a proposed dividend of €0.11 per share. The company will then report its first-quarter financial results for 2026 on May 12.