Oelrich told the newspaper that Europe, including the UK, is “innovation unfriendly,” as its countries’ policies make it difficult for drugmakers to generate adequate returns on their investments.

Like other companies, Bayer is unhappy with the UK scheme for branded medicines pricing agreed between the Department of Health and the pharmaceutical industry. This requires companies to pay 15% of drug sales revenue to the government if the National Health Services’ overall bill for medicines rises by more than 2% annually.

The lower net prices are especially biting in an environment with 10% inflation and no opportunity to pass on the higher costs to the market, Oelrich commented.

Another bone of contention between the pharma industry and European governments is the draft act for the financial stabilization of the public health insurance system passed by Germany’s Bundestag (lower house of parliament) in October 2022. As a cost-containment measures this would reduce the period in which a company can set its own price for a pharmaceutical product from 12 months to six months.  

Looking toward greener pastures beyond Europe, the Bayer pharma chief said the Leverkusen-based company has already established a “significant market presence” in China, where the government is “increasingly welcoming of innovation.”

In the US, he said higher drugs prices suffice to compensate for the explosion of costs caused by high inflation. Oelrich noted that Bayer’s heavy investment in the market where it recently acquired biotech companies Asklepios BioPharmaceutical and Vividion Therapeutics in deals worth “up to a combined $5.5 billion” is paying off.

Bayer’s upbeat forecast for its pipeline at JPMorgan lent its long-suffering share price a boost of 6.5%. Combined, the growth drivers Kerendia, asundexian (both cardiovascular), Nubeqa (prostate cancer) and elinzanetan, a hormonal treatment for hot in menopause, are projected to have e a peak sales potential of $12.9 billion.

Author: Dede Williams, Freelance Journalist