Bayer to adjust pharma research budget

Bayer has announced it is adjusting its pharmaceutical research and development budget for this year and next with a view to increasing it further in the coming years.

In a statement where the company also raised its earning guidance, Bayer said that its pharmaceutical research and development budget would now be about 15 per cent of sales.

“We are adjusting our pharmaceutical research and development budget for this year and in 2008 to about 15 per cent of the division’s sales. We expect that the budget will be between 15 and 17 per cent in the years thereafter,” said Arthur Higgins, chairman of the executive committee of Bayer HealthCare.

Discussing the predicted earnings for the company over the next few years, chairman of the board of management Werner Wenning said that he expected the EBITDA (earnings before interest, taxes, depreciation and amortization) to exceed 20 per cent and that the firm was aiming for a 22 per cent margin.

Mr Wenning placed a deal of importance on the Schering takeover, saying that the move “contributed to an increased profitability”.

Earlier this month, Bayer Schering Pharma AG announced its intention to terminate its registration with the United States Securities and Exchange Commission following Bayer’s acquisition of the company.