Bayer Expands U.S. Presence, ‘People Will Learn Bayer Is More Than Aspirin’

While other drug companies look to Asia, Bayer AG is placing its bets on North America. Its massive expansion in the U.S. includes everything from life science laboratories to an Instagram page, and the move is already paying off.

According to Arkansas Online, Bayer was founded 153 years ago as a chemical-and-dye manufacturer. Now, it’s a multi-billion dollar conglomerate focusing on pharmaceuticals, the 14th biggest drug-maker in the world. Many people just know Bayer for aspirin, a medicine it patented in 1899, but the company hopes to change all that.

Phil Blake, Bayer’s U.S. president explained, “I hope that over the next few years, people will learn that Bayer is more than aspirin,”

Bayer has reformed itself into a purely “life science” company focused on the health of people, pets, and plants last year. They currently have 170 consumer health products being marketed. In 2014, Bayer AG bought out Merck & Co’s health unit for $14.2 billion, making them the leader in consumer health products in the U.S., even beating out Johnson & Johnson.

Chairman of Bayer AG's Group Board of Management Marijn Dekkers at a shareholders meeting in Germany. [Photo by Christof Koepsel/Getty Images]

Bayer’s expansion also involves big investments in research and sending new products into the U.S. market.

In San Francisco, the German company has started a business incubator for startups in experimental medicines and related technology. On the east coast, Bayer is joining with Johns Hopkins University to create medicines for vision-damaging diseases and joining Massachusetts startup CRISPR Therapeutics to develop therapies for blood disorders, blindness, and other conditions.

The expansion involves jobs too. Hundreds of scientists, factory workers, and salesmen are being hired for the new research labs and factories.

According to the San Francisco Gate, Bayer expanded its research budget by 21 percent last year to $4.7 billion, and they’re tackling two areas that are being overlooked by other big drug companies – heart disease and women’s health.

Bayer sells birth control pills, including Yaz and Yasmin. Its birth-control implant Essure, has come under scrutiny over complaints of bleeding and chronic pain.

On the plant health-side of the business, Bayer might be mulling over a major sale. According to the Wall Street Journal, Monsanto approached Bayer about buying their CropScience unit, which has been valued at a potential $30 billion. After China National Chemical Corp. bought Syngenta AG, there’s more pressure for seed and herbicide companies to consolidate to keep pace.

Still, if Bayer is dedicated to transformation into a “pure life science” company, then its crop science unit will be important, even if it has had a few bumps along the way.

In 2011, Bayer AG had to pay $750 million to settle a case for crop sciences according to Bloomberg. Farmers had alleged that the German company’s genetically modified rice had spread into their crops, tainting them and ruining their export value.

Not everyone is happy about Bayer's products - especially in Crop Sciences. [Photo by Christof Koepsel/Getty Images]
Not everyone is happy about Bayer’s products – especially in Crop Sciences.
[Photo by Christof Koepsel/Getty Images]

But now Bayer is pumping $1 billion into its crop sciences, seemingly ignoring acquisition offers. It’s building greenhouses and developing new seeds that can help farmers cope with climate change.

Bayer is also expanding into cancer medicines, with two dozen currently under patient testing.

Marketing is also getting a massive expansion. The Bayer logo, once reserved for pain killers, is now on a wide variety of products. Likewise, the company now has it’s own Instagram page, full of pictures of lab workers and farmers, and it’s increased its presence on Twitter and Facebook.

The expansion already shows signs that it is paying off. Bayer’s sales in the U.S. and Canada were about $14 billion, a 28 percent increase from last year. Globally, sales rose 12.5 percent to $51 billion.

As Assistant Professor Erik Gordon of the University of Michigan’s Ross School of Business explained, “They’re more likely to have a bright future by doing this than not.”

As for Bayer’s historic chemical-and-dye business, they spun that off last year.

[Photo by Andreas Rentz/Getty Images]