Industry Trend Analysis - Bayer Intensifies R&D Focus To Improve Cancer Pipeline - JAN 2018


BMI View: Undertaking deals to stock its cancer pipeline will ensure that Bayer is able to mitigate losses from any late stage product candidate s that experience failure. Loxo Oncology was a prime target for a deal, and will likely gain further attention from big pharma as its pipeline of products for genetically defined targets progress through trials.

Bayer is driving the expansion of its pharmaceutical pipeline through agreements with small biotechs, a strategy of many big pharma companies with the aim of reducing risk. Bayer's deals with Loxo Oncology and PeptiDream will fill the company's pipeline, and aid in the creation of a strong oncology portfolio.

Bayer's currently marketed oncology portfolio is limited to four drugs: Nexavar (sorafenib), Stivarga (regorafenib) and Xofigo (radium Ra 223 dichloride), which are leaders in their markets, and the relative newcomer Aliqopa (copanlisib), which gained approval in September 2017 and extended Bayer's reach into haematological cancer. Nexavar revenues are declining and Stivarga is struggling to maintain growth, while Xofigo sales are accelerating.

Loxo Products Have Growth Potential
Loxo Product Revenue Forecasts (USDmn)
f = forecast. Source: Bloomberg, BMI

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