Bayer picks up pace of managerial jobs cull
06 Aug 2024
Bayer provided an update Tuesday about the company's ongoing downsizing efforts, saying it has cut 3200 full-time, mostly managerial jobs, in the first half of 2024. The progress signals an acceleration of layoffs after the German company announced it had eliminated 1500 positions in the first quarter.
CEO Bill Anderson, who took over from Werner Baumann a little over a year ago, introduced the layoffs in a bid to trim bureaucracy and shift "95% of the decision-making in the organisation…from managers to the people doing the work." The company had close to 100,000 staffers at the end of 2023.
Voluntary redundancies, affecting primarily managers, have so far been consistent with a target to cut €2 billion ($2.2 billion) in annual costs from 2026, Anderson said during a company media call, adding "this is exactly what we envisioned."
"One of the central commitments we made at Capital Markets Day is that this organization will consistently perform while simultaneously addressing the longer-term roadblocks holding us back. The 154 days since March 5th have been pretty good evidence that we can do both," he added.
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Despite the challenges, Bayer said its pharmaceutical division showed promising growth in the second quarter, particularly in its newer products. Prostate cancer drug Nubeqa saw sales soar by 89.1% to €380 million, while sales of Kerendia, its treatment for chronic kidney disease, grew 71.6% to €115 million.
However, the company's bestselling blood-thinning drug Xarelto faced headwinds, with sales declining 13% to €904 million. The eye disease treatment Eylea, for which Bayer holds revenues exclusive rights outside the US, managed 3.6% growth, reaching €843 million in quarterly sales. Overall, sales of prescription medicines rose by 4.5% to €4.6 billion.
Looking ahead, Bayer raised its outlook for the pharma division, now expecting 2024 sales to grow by up to 3%, an improvement over its previous forecast of flat to a 4% decline.
Meanwhile, Anderson says he is confident in the company's pharma prospects. "In just the past 90 days, we've taken big steps toward filling the mid-stage pipeline, expanding labels and advancing late-stage assets… Our pharma pipeline is one of our biggest levers for value creation," he said.
The company is preparing for two new drug launches early next year; elinzanetant, a non-hormonal treatment for vasomotor symptoms associated with menopause that was filed for FDA approval last week, and cardiovascular therapy acoramidis, for which Bayer acquired EU rights from BridgeBio earlier this year.
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