Bayer Doubles Down on Ophthalmology With $2.45 Billion Perfuse Buy – FDA Priority Review Adds to Pipeline Momentum

Bayer acquires Perfuse Therapeutics for up to $2.45B to replace Eylea, as FDA grants priority review for Kerendia in type 1 diabetes. Analysts upgrade stock.

The clock is ticking on Bayer’s biggest drug franchise. Eylea, the blockbuster eye treatment that generated €3.11 billion in sales last year, loses US patent protection in 2027. The Leverkusen-based group is wasting no time in building a replacement. On the same day the US Food and Drug Administration accepted a priority review for its kidney drug Kerendia, Bayer announced the acquisition of Perfuse Therapeutics for up to $2.45 billion.

The deal centers on PER-001, an implant designed to tackle glaucoma and diabetic retinopathy. Bayer is paying $300 million upfront, with the remaining $2.15 billion contingent on milestones tied to development, approval and commercial success. Early data from a Phase IIa trial showed that 37.5% of patients on the high dose improved their visual field by at least seven decibels, while the control group saw no comparable benefit. In diabetic retinopathy, contrast sensitivity rose by 0.9 decibels in the treated group, compared with a decline of 2.1 decibels in the comparator arm.

The move comes as the pressure to refill the pipeline intensifies. In the first quarter, US sales of Eylea slipped 10% to $941 million, a foretaste of the erosion to come once generics enter the market. Worldwide, roughly 146 million people suffer from diabetic retinopathy, and the number of glaucoma patients is forecast to climb to 112 million by 2040. Bayer is betting that PER-001 can capture a slice of that growing pool and offset the looming revenue gap.

On the same May 21 when the Perfuse deal was unveiled, the FDA granted priority review to Bayer’s supplemental application for finerenone, marketed as Kerendia. The drug is already approved for chronic kidney disease in type 2 diabetes; the new indication covers adults with type 1 diabetes and chronic kidney disease. If cleared, Kerendia would become the first non-steroidal mineralocorticoid receptor antagonist available for that patient group in the US. The filing is backed by data from the Phase III FINE-ONE trial, which demonstrated a significant reduction in the urine albumin-creatinine ratio.

The regulatory tailwinds extend beyond Kerendia. Bayer recently secured accelerated review procedures for the blood thinner asundexian and the Alzheimer’s candidate hyrnuo, giving its pharmaceutical pipeline a visibility that had been lacking. Analysts are taking note. DZ Bank’s Peter Spengler upgraded Bayer from “Hold” to “Buy” and raised the price target from €44 to €51. That implies upside of more than 30% from the current share price of €38.88. Barclays followed with a target increase from €48 to €50, keeping an “Overweight” rating.

The optimism is supported by a solid first quarter. Bayer posted revenue of €13.41 billion and adjusted earnings per share of €2.71, up 12.9% year on year. Net profit more than doubled to €2.81 billion, a 116% jump. Even so, the stock edged down 0.5% on Thursday to €39.04, with some investors taking profits after a near-60% rally from the 52-week low.

Debt remains the dark cloud. Net financial debt stood at €32.5 billion at the end of March, a level that continues to weigh on sentiment. The company has outlined a cost-cutting program aimed at slicing €2 billion from operating expenses, and management is expected to provide a more concrete deleveraging roadmap on May 27 at the Deutsche Bank European Champions Conference in Frankfurt.

The acquisition of Perfuse will add to the debt burden in the near term, but Bayer is betting that the long-term payoff from PER-001 – combined with the accelerated pipeline for Kerendia, asundexian and hyrnuo – can build a bridge beyond the Eylea patent cliff. Whether that bet pays off will depend on the clinical milestones still to come.