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Second quarter 2011 -
Bayer continues positive
momentum
Werner Baumann, CFO



08/30 – 09/01/11 – U.S. West Coast Roadshow
Disclaimer
This presentation may contain forward-looking statements based on current
assumptions and forecasts made by Bayer Group or subgroup management.
Various known and unknown risks, uncertainties and other factors could lead to
material differences between the actual future results, financial situation,
development or performance of the company and the estimates given here.
These factors include those discussed in Bayer’s public reports which are
available on the Bayer website at www.bayer.com.
The company assumes no liability whatsoever to update these forward-looking
statements or to conform them to future events or developments.




Page 2 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
2nd quarter 2011 – Bayer continues positive momentum


      Group outlook 2011 projects higher sales and adjusted EBITDA


      €15bn investment plan through 2013 to maximize value of new product
      pipeline strength and to realize emerging markets opportunity


      Two-year group restructuring plan to generate €800m efficiency
      improvements underway




Page 3 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
2nd Quarter 2011 –
Bayer Continues Positive Momentum
                                                   Q2‘11             ∆%                    Highlights
                                                   € million        € million

Sales                                               9,252          +1 (+5)
                                                                                         Solid business expansion
EBITDA
- reported                                          1,906              +6                Adjusted EBITDA improved, good
- adjusted                                          2,035              +6                 season for CropScience, slight
EBIT                                                                                      expansion at HealthCare,
- reported                                          1,273             +26
                                                                                          MaterialScience remained level
                                                                                          yoy
- adjusted                                          1,417             +12
Net income                                            747             +41                Reported EBIT impacted by net
Net cash flow                                       1,530              -1                 special charges of €144m
Free operating cash flow                            1,232              +4
EPS                                                                                      2011 Group financial outlook
- reported                                          0.90€             +41                 reiterated
- core                                              1.29€             +11
( ) = Fx & portfolio adjusted




Page 4 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
2nd Quarter 2011 –
Breakdown By Segment

                                                                    Sales                                    adj. EBITDA
                                                                                         ∆%
                                                 2010                2011                            2010       2011       ∆%
                                                                                        (adj.)

HealthCare                                     4,305               4,208              -2 (+2)        1,122     1,156       +3

Pharma                                          2,748               2,666            -3 (+0.5)        772       807        +5
Consumer Health                                 1,557               1,542              -1 (+4)        350       349         0

CropScience                                    1,884               1,943              +3 (+9)        380        471        +24

MaterialScience                                2,689               2,782              +3 (+8)        373        372         0
In € million, ( ) = Fx & portfolio adjusted




Page 5 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
2nd Quarter 2011 –
Emerging Markets Leading The Growth
         Q2 2011 Group sales by region                                                                  Emerging Economies
                                                                                                     +5%
  USA                                                           Emerging
  +4%                                                          Economies¹                           ~1,300
               20%                            36%                 +7%
                 20%                          36%
                                                                                                                       +4%

                                                                                                                       ~900

                                                                                                                                         +9%
               34%
                                                                                                                                                         +14%
                                                                                                                                         ~600
                                            10%                                                                                                           ~500



Western Europe                                         Others²
+6%                                                     +2%

                     Group €9,252m; +5%                                                          Emerging            Latin            Eastern         Africa &
                                                                                                  Asia³             America           Europe         Middle East

In € million, ∆% yoy Fx adjusted                                                                ¹ Emerging economies include: Latin America, Asia w/o Japan, Australia,
                                                                                                   New Zealand, Africa and Middle East incl. Turkey, Eastern Europe
                                                                                                ² Others = Japan, Australia, New Zealand, Canada
                                                                                                ³ Emerging Asia = Asia w/o Japan, Australia, New Zealand
Page 6 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
2nd Quarter 2011 –
Cash Flow And Net Debt Development
                              Q2 2011 Cash Flow                                                      Net Debt Development
In € million                                                                                         In € billion



                    GCF                    NCF                  Invest-                  oFCF
                                                                                                                    +0.3
                                           cont.                ments
                                                                                                           7.1              7.4


                    1,532                   1,530                   298                   1,232


  ∆%
  y-o-y             +19%                     -1%                   -18%                   +4%
                                                                                                          Q1´11            Q2´11




Page 7 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Fiscal 2010 –
Operating Performance On Track
                                                   FY‘10             ∆%                    Highlights
                                                   € million        € million

Sales                                              35,088         +13 (+8)
                                                                                         Achieved group financial targets in
EBITDA                                                                                    2010
- reported                                          6,286              +8
- adjusted                                          7,101             +10                Strong year at MaterialScience –
EBIT                                                                                      HealthCare and CropScience
- reported                                          2,730              -9
                                                                                          below
- adjusted                                          4,452             +18
                                                                                         Net income diminished by high
Net income                                          1,301              -4                 special charges
Net cash flow                                       5,773              +7
Free operating cash flow                            4,152             +12                Strong operating cash flow – net
EPS                                                                                       financial debt reduced
- reported                                          1.57               -8
- core                                              4.19              +15
( ) = Fx & portfolio adjusted




Page 8 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Selected Indicators 2006-2010 -
Track Record of Performance
 EBITDA before special items and margin* (€ billion)                                Core earnings per share* (€)
                                                                        7.1
                    6.8              6.9               6.5                           5                                                            4.19
   5.6                                                                                                                 4.17
                                                                                                          3.80                      3.64
                                                                                     4
                                                                                            2.99
                                                                                     3
 19.3%            20.9%             21.1%            20.8%            20.2%
                                                                                     2
                                                                                     0
2006            2007              2008             2009              2010                  2006          2007         2008         2009           2010


 Net cash flow* (€ billion)                                                         Net financial debt*, ** (€ billion)
                                                                        5.8         20       17.5
                                                       5.4                          16                                  14.2
   3.9              4.3                                                                                   12.2
                                      3.6                                           12                                               9.7
                                                                                                                                                  7.9
                                                                                      8
                                                                                      4
                                                                                      0
 2006              2007             2008              2009             2010                 2006         2007         2008          2009          2010

                                                                                              * 2006 - 2008 from continuing operations ** year-end data


Page 9 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Building A World-Class

                                      Innovation Company

Page 10 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Building A World-Class Innovation
Company

                 Portfolio                                               Growth                            Productivity

   Build on leading industry                              Invest in innovation                        Decomplex structures
   position in all 3                                      capabilities                                and processes
   subgroups
                                                          Maximize value of new                       Implement two-year
   Enhance competitive                                    product pipeline strength                   group restructuring plan
   position
                                                          Realize emerging market
                                                          opportunity




                Target is to deliver mid-single digit organic sales growth in 2011
                and to invest €15bn in growth during 2011 - 2013


Page 11 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Bayer –
A Leader in Its Markets
                                                                €16.9bn              HealthCare
                                                                                     Pharmaceuticals €10.9bn,
                                                                                     leading positions in key categories

                                                                                     Consumer Health €6.0bn,
                                                                                     OTC pharmaceuticals, blood glucose meters and
             50%                                 30%                                 veterinary medicines, global #2-4


                                                                  €6.8bn             CropScience
                                                                                     Agrochemicals and seeds & traits,
                                                                                     global #2 in agrochemicals
                                            20%
                                                                €10.2bn              MaterialScience
                                                                                     Polyurethanes and polycarbonates,
                                                                                     global #1/2


             Sales 2010: €35.1bn


             Break-down excluding reconciliation

Page 12 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
HealthCare-
Pharma Pipeline Maturing
                                                                        What it does                              Status

                                                                                                      1st indication launched/
 Cardiology




                Xarelto                                  inhibits blood clot formation
                                                                                                      filed; phase III

                                                         lowers blood pressure in the
                Riociguat                                                                             phase III
                                                         lung

                                                         inhibits enzymes important for               launched, additional
                Nexavar
                                                         tumor growth                                 indications in phase II/III
 Oncology




                                                         inhibits enzymes important for
                Regorafenib                                                                           phase III
                                                         tumor growth

                                                         targeted treatment of bone    Alsympca trial (phase III)
                Alpharadin
                                                         metastases in prostate cancer stopped early on success
  Diseases




                                                         inhibits formation of new                    1st indication filed;
     Eye




                VEGF Trap-Eye
                                                         blood vessels                                phase III

Page 13 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Xarelto Inhibits the Blood-clotting
Process at a Pivotal Stage
      The blood coagulation cascade
                                                                                Thromboembolism is the single
                                                                                 largest cause of morbidity and
                                                                                 mortality in the western world.

                                                                                Anticoagulant drugs inhibit the
                                                                                 coagulation cascade and are the
                                                                                 mainstay of antithrombotic therapy.

                                                                                Current treatment options have
                                                                                 limitations:
          Xarelto
                                                                                          Heparin  parenteral administration
                                                                                          Vitamin K antagonists (e.g. Warfarin)
                                                                                            narrow therapeutic window, slow
                                                                                           onset of action, unpredictable
                                                                                           pharmacology



Page 14 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Xarelto: Addressing Medical Needs
Across a Wide Range of Patients
           Indication                                                Phase III Program                        Status

  Stroke Prevention in
  Atrial Fibrillation (AF)                                                                                  Filed in US, EU


  VTE-Treatment                                                                                             Filed in EU /
                                                                                                            US-filing early 2012e

                                                                                                            Data late 2011e /
  Sec. Prevention in ACS                                                                                    early 2012e

                                                                                                            Data reported;
  VTE-Prevention in
                                                                                                            further analysis
  Medically Ill Patients                                                                                    underway
  VTE-Prevention after elective hip                                                                         Launched
  and knee replacement Surgery                                                                        1-4




Page 15 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Xarelto Demonstrated an Excellent
Clinical Profile in Key Indications
                                       1-4          Superior efficacy: 52% relative risk reduction*
    VTE prevention after
    orthopedic surgery
    (RECORD 1- 4 trials)
                                                    Rates of major bleeding low. No statistically significant difference
                                                    Comparator: enoxaparin
                                                                                                                                                                     
                                                    EINSTEIN-DVT
                                                    Non-inferior efficacy - significantly improved net clinical benefit **
                                                    Composite of major and clinically relevant non major bleeding similar
     DVT treatment and                               with numerically lower major bleedings
     Extended secondary
     prevention of VTE
     (EINSTEIN-DVT and
                                                    Comparator: enoxaparin followed by vitamin K antagonist
                                                   EINSTEIN-Extension
                                                    Superior efficacy: 82% reduction of recurrent VTE
                                                                                                                                                                     
     EINSTEIN-Extension trial)
                                                    Low incidence of major bleeding. No stat. significant difference
                                                    Comparator: placebo


                                                    Non-inferiority
                                                                   vs. warfarin in ITT and per-protocol population. Active
                                                     treatment superior to warfarin in reducing the risk of stroke and non-CNS


                                                                                                                                                                     
    Stroke prevention in atrial                      embolism in the safety population.
    fibrillation                                    Composite of major and clinically relevant non major bleeding similar
    (ROCKET-AF trial)                               Comparator: vitamin K antagonist
  Selection of clinical trial results. For full data see publications: VTE prevention after orthopedic surgery (RECORD) data published in NEJM (RECORD 1: Vol 358 2008;
  RECORD 3: Vol 358 2008) and Lancet (RECORD 2: Vol 372 2008; RECORD 4: Vol 373 2009), extended sec. prevention of VTE (EINSTEIN-Ext.) and DVT treatment
  (EINSTEIN-DVT) data publiashed in NEJM Vol 363 2010; stroke prevention (ROCKET-AF) data published in NEJM (online August 10, 2010)
  *) Symptomatic VTE + all-cause mortality in pooled analysis of RECORD 1-4; **) Secondary outcome defined as composite of primary efficacy endpoint plus major bleeding

                                                                                                                        VTE: Venous thromboembolism; DVT: Deep vein
Page 16 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011                     thrombosis; ITT: Intention to treat
VEGF Trap-Eye –
Addressing Major Eye Diseases
                              wet AMD                                                      Diabetic Macular Edema (DME)
   Wet AMD is due to abnormal blood vessel                                                  Most prevalent cause of vision loss in
    growth in the eye; the disease accounts for                                               patients with diabetes.
    approx. 90% of AMD-related blindness.                                                    Clinically significant DME is a leading cause
   Wet AMD is the leading cause of acquired                                                  of acquired blindness in the adults aged
    blindness in the elderly.                                                                 <50years.
   Approx. 1.5 million patients annually in the                                             Approx. 370,000 patients suffer from clinically
    US.                                                                                       significant DME in the US, with 95,000 new
                                                                                              cases / year.

    Central Retinal Vein Occlusion (CRVO)                                                              myopic CNV

        Obstruction of central retinal vein may lead                                   In myopic patients, the eyeball is too long –
         to vision loss and other serious                                                this situation puts strain on retina and may
         complications.                                                                  lead to pathological changes (e.g. irregular
                                                                                         vessel growth) in the back of the eye.
        > 100,000 people in the US and > 66,000
         people in key EU countries are estimated to                                    Severe myopia is common in Asia; in
         suffer from CRVO.                                                               Japan, mCNV is the second most common
                                                                                         cause of blindness.

                                                                                                               AMD: Age-related macular degeneration
Page 17 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
                                                                                                               CNV: Choroidal neovascularization
VEGF Trap-Eye – Key Data from Clinical
Studies Suggest a Competitive Profile
                                                            Phase III program incl. 2,457 patients (VIEW 1, VIEW 2)
   Wet Age-Related Macular                                  Primary efficacy endpoint met, non-inferiority compared to Lucentis
   Degeneration (wet AMD)
                                                       
                                                             demonstrated
                                                             One year data demonstrated potential for less frequent dosing with          
                                                             comparable vision maintenance


                                                            Phase III program incl. 354 patients (COPERNICUS, GALILEO)
   Central Retinal Vein
   Occlusion (CRVO)
                                                            Primary efficacy endpoint met, demonstrating significant
                                                             improvement in vision after six months of treatment compared to
                                                             sham-injections
                                                                                                                                         
                                                            Phase II study incl. 219 patients (DaVinci)
   Diabetic Macular Edema                                   VEGF Trap-Eye vs. laser treatment:
   (DME)                                                     Primary endpoint met: Visual acuity gains over 24 weeks were
                                                             maintained or numerically improved up to completion of the study
                                                             at week 52
                                                                                                                                         
                                                            Phase III trial initiated
VEGF Trap-Eye was generally well tolerated and the most common adverse events were those typically
associated with intravitreal injections or the underlying disease.
Selection of clinical data. For further details see Bayer press releases from November 22, 2010, December 20, 2010 and April 27, 2011.
Further data presented at Angiogenesis Conference, Miami, Florida, February 12, 2011.
VEGF Trap-Eye –
Status of Clinical Program
           Indication                                            Phase III Program                     Status

  Wet age-related macular
  degeneration (AMD)                                                                                  Filed


  Central retinal vein occlusion                                                                      Filing 2012e
  (CRVO)


  Diabetic macular edema (DME)                                                                        Phase III ongoing


  Myopic choroidal
                                                                                                      Phase III ongoing
  neovascularizytion (CNV)




Page 19 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Alpharadin – New Opportunities to
Treat Bone Metastases
  Alpha-pharmaceutical (based on 223Radium, delivering highly energetic, short ranging
   radiation) - in-licensed from Algeta
  Radium as natural bone seeker targeting bone metastases
  Phase III in hormone-resistant prostate cancer (HRPC)
  ALSYMPCA (phase III) in patients with smptomatic HRPC with sceletal metastases
   stopped early - Alpharadin demonstrated significant improvement in overall survival vs.
   placebo
  Filing targeted mid 2012e
  Fast track status granted by FDA
                                                                 Tumor cells
                                                       Newly formed
                                                       bone




        Bone metastases                                 Radium-223 deposition                     Radium-223: highly localized tumor cell killing

                                                                                                                  HRPC: Hormone-refractory prostate cancer
Page 20 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Expected 2011 Major
Pipeline Newsflow
 Project / Study                                                                                      When expected?


 Xarelto                             ATLAS TIMI 51; phase III in secondary                            Data end 2011e /
                                     prevention of acute coronary syndrome (ACS)                      early 2012


 Xarelto                             EINSTEIN PE; phase III in treatment of PE and Data end 2011e /
                                     secondary VTE prevention                      early 2012


 Xarelto                             Potential newsflow on submissions                                2011e


 Nexavar                             Phase III in NSCLC and phase III in thyroid                      Completion end
                                     cancer                                                           2011e / 2012e


 VEGF Trap-Eye                       Two-year data from wet AMD phase III VIEW
                                                                                                      2011e
                                     program

Page 21 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
CropScience - Innovation Leadership in
AgChemicals, Promising BioScience Pipeline

       23 new agrochemical active ingredients launched,
       generated sales of €2bn in 2009                                                                2000 - 2009


       Six new agrochemical substances with sales potential
       of more than €1bn to be launched                                                               2010 - 2012E


       Expect 18 new BioScience products to be launched                                               2010 - 2016E


       Numerous early-stage research and early development
       projects in Crop Protection and BioScience




Page 22 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Growth Platform Ag BioScience -
Strongly Expanded in 2010
      Planned sales development                                                                       Key growth drivers
       in € million
                                                                                      Fast growing established business in
                                                                                       cotton, canola, rice and vegetables
                                                               ~1,400
                           Planned: CAGR 12%
                                                                                      Regional expansion and introduction of
                                                                                       new varieties
                                                >1,000
                                                                                      Exploit traits potential through
                                                                                       licensing agreements
                                    687                                               Extension of our crop-portfolio to
                         +37%
                                                                                       soybean and cereals
                     503
                                                                                      Increase of BioScience’s share of
       240                                                                             CropScience R&D expenditures

                                                                                      R&D capacities strengthened through
                                                                                       acquisition of Athenix (2009)
     2002*          2009           2010         2015 E 2018 E
   *2002 sales pro-forma Bayer + Aventis CropScience

Page 23 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
CropScience – Translate R&D More
Effectively Into Sales
  Realign company activities with a stronger customer focus

  Restructure and further invest in global marketing to enable improved
   commercial execution

  Extend use of state-of-the-art customer relationship management tools

  Broaden food chain partnership business model

  Focus on global flagship brands and deliver packaged solutions to
   differentiated customer segments




Page 24 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
MaterialScience –
World-Class Applications Research
                                    Bayseal ®                                                         Baytherm®
                                    Creates a seamless air                                            Combines high mechanical
                                    barrier system working like a                                     strength with high insulating
                                    building envelope                                                 capacity and low weight


                                                                                                      Makrolon®
                                    DurFlex®                                                          Forming lightweight exterior
                                    Improving noise reduction                                         car body parts from
                                    and economics of rail track                                       polycarbonate
                                    operations


                                     Bayblend® FR                                                     Bayfol Reflex ®
                                     A new safety concept for car                                     Actuators out of polymers
                                     batteries to make housings                                       give tactile feedback precisely
                                     flame retardant                                                  adjusted to requirements


                                    Makrofol®ID                                                       Baycusan®
                                    Film for ID cards providing                                       Solvent-free polyurethane
                                    scratch resistance and                                            based polymers for cosmetic
                                    protecting against counterfeit                                    applications


Page 25 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Opportunity

                                Emerging Markets

Page 26 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Emerging Markets –
Significant Growth Momentum
   2010 Group Sales break down; ∆% yoy Fx adjusted




                                                                                                                              +18%

                                                          64%                                     36%
               +3%


     Developed markets                                                                                               Emerging markets1


                                                                                                      ¹ Emerging markets include: Latin America, Asia w/o Japan, Australia,
Page 27 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011     New Zealand, Africa and Middle East incl. Turkey, Eastern Europe
BRIC - Countries Can Collectively
Become a 10bn Euro Business in 2015
Sales in € bn                                                                                                          ~6.0bn
6




                                                                                                               2.9bn
3
                             >2bn

2
             1.6bn

                                                                                                      ~1.0bn
1                                                                ~0.8bn
                                                   0.5bn                                0.5bn


0
              2010           2015                  2010            2015                  2010         2015     2010    2015




Page 28 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Bayer is One of The Leading International
HealthCare Companies in China
                                                                                    Strong growth
                                                                                     Driven by Pharmaceuticals (+17% yoy)
                                       HealthCare 2010
                                       €823m +15% y-o-y (Fx-adj.)*                   Pharma portfolio includes established
                                                                                      branded products as well as innovative
                                                                                      products like Nexavar, Scilin Insulin and
                                                                                      Xarelto

                                                                                    Significant investment commitment
                                                                                     Approx. 5,300 employees (2010)
                                                                                     €100m over 5 years to set-up a global
                                                                                      R&D center in China
  Top products growth in 2010*
  Glucobay                                                           +22%            Beijing manufacturing site expansion
  Ultravist                                                          +16%             (~€45m through 2015)
  Aspirin Cardio                                                     +15%
  Avelox                                                             +14%            Partnership with Tsinghua University
  Adalat                                                             +10%             (joint drug discovery, student support)

   All growth rates y-o-y Fx-adj.
   * People‘s Republic of China


Page 29 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
CropScience in Brazil – Gained Share in
One of the World’s Largest Ag Markets
                                                                                      Brazil is the 2nd largest market
                                                                                       for CropScience
                                                                                      Bayer is one of the leading suppliers
                                                                                       and growing strongly
                                                                                      Bayer gained market share in each of
                                                                                       the past 3 years
                                                                                      2010 Crop Protection performance
                                                                                       driven by strong sales increase in
                                                                                       insecticides and herbicides, especially
                                                                                       with new products
                                                                                      BioScience growth driven by cotton
       CropScience sales (in €m)                                                       seed
                                                                  CAGR                Risk management systems in place to
                                                       847        +19%
                                676         724                                        limit the potential impact of reduced
         421        493
                                                                                       credit availability; established barter
        2006       2007        2008        2009 2010                                   business


Page 30 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
€1bn New Investment Plan
at MaterialScience in China
   Asia/Pacific is leading the recovery                                                  Commitment to growth in China

 China already is the world’s largest PCS                                            €2.1bn investment program in integrated
  market                                                                               polymer site in Shanghai, China until 2012

 China is set to become the world’s largest PUR                                      New investment of approx. €1bn in Shanghai
  market by 2015                                                                       by 2016 to
                                                                                                     Increase MDI capacity to 1,000kt/year
                                                                                                     More than double PCS capacity to
                                                                                                      500kt/year
                                                                                                     Increase HDI capacity, new 50kt/year
                                                                                                      line planned
                                                                                      Transfer of PCS Headquarters from
                                                                                       Leverkusen to Shanghai
                                                                                      Increasing downstream presence (investment
                                                                                       of €110m by 2012)


                                                                                                                           PCS = Polycarbonates
                                                                                                                           PUR = Polyurethanes

Page 31 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
More Innovation

                                     Less Administration

Page 32 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Restructuring Program Initiated
         Contribution by Subgroup                                                                     Savings Initiative

                                                                                       Savings and efficiency initiative at
    Holding & Admin.                                                                    HealthCare, CropScience and
                                                HealthCare                              corporate level

                          ~12%                                                         Annual cost savings of €800m
                                                                                        starting 2013, reinvestment of ~50%

                                                                                       One-time-charges of around €1bn by
                                              ~54%
                   ~34%                                                                 end of 2012

                                                                                       Plans include reductions of 4,500
                                                                                        people
  CropScience                                                                          2,500 new hires in growth and
                                                                                        innovation, particularly in emerging
                                                                                        markets

Page 33 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Efficient Use of Cash
           Funding organic growth
            CapEx budget 2011: €1.5bn for PPE


           Deleveraging balance sheet
            Compliant with single A credit rating category


           Cash return to shareholders
            Dividend policy: Pay out 30-40% of Core EPS
            Share buyback: No priority

           Acquisitions
            Focus is on organic growth, complemented by bolt-on acquisitions


Page 34 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Full Year 2011 –
Group Outlook
 Sales ∆ Fx and portfolio adjusted, EBITDA pre-special items

                                                                                           2011E                    2011E
                                   2010                        ∆
                                                                                          Original                  Update


  Sales                                                                                    4-6%                    5-7% to
  (Fx & portf.                  €35.1bn                      +8%
  adjusted)                                                                              €35-36bn                 €36-37bn



  adj.                                                                              Improve toward
                                 €7.1bn                    +10%                                                    > €7.5bn
  EBITDA                                                                                €7.5bn



  Core EPS                        €4.19                    +15%                             ~10%                     ∽15%

                                                                                                      Outlook depends on specific planning assumptions
                                                                                                              as detailed in the Annual/ Quarterly Report

Page 35 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Full Year 2011 –
Guidance By Subgroup – Q2 Update
                                                                 Unchanged:
 HealthCare                                                      Low- to mid-single digit increase of sales and small increase of
                                                                 adj. EBITDA

                                                                 Unchanged:
 Pharma                                                          Low- to mid-single digit increase of sales and improvement of adj.
                                                                 EBITDA-margin


 Consumer                                                        Unchanged:
 Health                                                          Mid-single digit growth of sales and adj. EBITDA

                                                                 Unchanged:
                                                                 High-single-digit percentage higher sales and growth of adj.
 CropScience                                                     EBITDA by about 20% - or more if the season progresses well in
                                                                 2nd half
                                                                 Updated:
                                                                 High-single-digit percentage raise of sales. Adj. EBITDA still
 MaterialScience                                                 expected to increase at a higher rate than sales, although we
                                                                 regard this target as increasingly ambitious. Q3’11: Sales and adj.
                                                                 EBITDA in line with prior-year level
  Outlook based on Fx and portfolio adj. sales and EBITDA pre-special items
                                                                                                      Outlook depends on specific planning assumptions
Page 36 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011           as detailed in the Annual/ Quarterly Report
Appendix



Page 37 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
2011 – R&D and CapEx Budgets
            R&D 2011E: ~€3.1bn                                                               CapEx (PPE) 2011E: ~€1.5bn

 HealthCare                                    MaterialScience                                HealthCare            MaterialScience
 2.1bn                                                           0.2bn                                0.4bn                    0.6bn
 thereof
 Pharma
 1.8bn
                                     8%
                                    8%                      CropScience
                                                                                                        26%         44%
                                                                        0.7bn
                                                24%
                                                 24%



            67%                                                                                       12%
             67%
                                                              1%

                                                                                                              18%
                                                         Reconciliation                  Reconciliation                   CropScience
                                                               0.05bn                    0.2bn                                  0.3bn

      €15bn R&D and Capital Investment Plan until 2013 2013
            €15bn R&D and Capital Investment Program until
Page 38 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
HealthCare –
Business Set-up
 Pharmaceuticals                                    Consumer Care                        Medical Care                   Animal Health

 • Specialty Medicine                               • Non-prescription                   • Blood glucose                • Food animal
                                                        drugs                               monitoring systems            products
 • General Medicine
                                                                                            and accessories
                                                    • Vitamins and                                                      • Companion
                                                        nutritional                      • Medical devices                animal products
                                                        supplements                         (imaging and therapeutic
                                                                                            procedures)

     Leading positions in certain                    Global # 2                           A leader in medical devices   Global # 4
     therapeutic categories




Page 39 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
HealthCare –
Key Data
                                                                  2nd Quarter       2nd Quarter       Change        FY        FY   Change
 EUR million
                                                                    2010              2011              %       2009     2010        %

 Sales                                                                4,305            4,208             -2.3   15,988   16,913       +5.8

  Pharmaceuticals                                                     2,748            2,666             -3.0   10,467   10,908       +4.2

  Consumer Health                                                     1,557            1,542             -1.0    5,521    6,005       +8.8

 EBIT                                                                   595              786            +32.1    2,640    1,861       -29.5

   Special items                                                      (189)              (51)                    (372)   (1,169)

   EBIT before special items                                            784              837             +6.8    3,012    3,030       +0.6

 EBITDA                                                               1,065            1,105             +3.8    4,148    4,116        -0.8

   Special items                                                        (57)             (51)                    (320)    (289)

   EBITDA before special items                                        1,122            1,156             +3.0    4,468    4,405        -1.4

   EBITDA margin before special items                                26.1%            27.5%                     27.9%    26.0%

 Gross cash flow                                                        759              760             +0.1    3,153    2,948        -6.5

 Net cash flow                                                          666              636             -4.5    3,431    3,320        -3.2



Page 40 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Crop Science –
Business Set-up
 Crop Protection                                         Environmental Science                        BioScience

 • Insecticides                                          • Professional Products                      • Seeds & Traits
 • Fungicides                                            • Consumer Products
 • Herbicides
 • Seed Treatment


    Global # 2                                            The leader in this area                     Committed emerging player –
                                                                                                      access to technologies




Page 41 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
CropScience –
Key Data
                                                                  2nd Quarter       2nd Quarter       Change       FY      FY   Change
 EUR million
                                                                    2010              2011              %       2009    2010      %

 Sales                                                                1,884            1,943             +3.1   6,510   6,830      +4.9

   Crop Protection / BioScience                                       1,685            1,757             +4.3   5,927   6,180      +4.3

   Environmental Science                                                199              186             -6.5     583     650     +11.5

 EBIT                                                                   187              272            +45.5     798     261      -67.3

   Special items                                                        (66)             (81)                   (219)   (526)

   EBIT before special items                                            253              353            +39.5   1,017     787      -22.6

 EBITDA                                                                 314              405            +29.0   1,311     767      -41.5

   Special items                                                        (66)             (66)                   (197)   (526)

   EBITDA before special items                                          380              471            +23.9   1,508   1,293      -14.3

   EBITDA margin before special items                                20.2%            24.2%                     23.2%   19.0%

 Gross cash flow                                                        224              304            +35.7   1,043     546      -47.7

 Net cash flow                                                          782              823             +5.2     745   1,399      87.8



Page 42 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Material Science –
Business Set-up
                                                                                                      Coatings, Adhesives,
                                                                                                      Coatings, Adhesives,
 Polycarbonates
 Polycarbonates                                          Polyurethanes
                                                         Polyurethanes                                Specialties
                                                                                                      Specialties
 • Application in automotive                             • Rigid foams are used for                   • Input materials for coatings,
     (i.e. for weight reduction)                             insulation in construction, logistics       adhesives
                                                             and the cold chain
 • Construction                                                                                       • Coatings for vehicles, industrial
     (i.e. integrated heat and light
                                                         •   Elastic foams are used for comfort
                                                                                                         coatings, corrosion protection
                                                             applications for furniture, car and
     management)                                             other vehicle seats and                  • Adhesives for various applications
 • Electronics & IT                                          mattresses
                                                                                                      • Functional films and development
 • CD/DVD/Blu-ray                                        •   Further applications include
                                                                                                         businesses
                                                             equipment housing or structural
                                                             parts in automotive (i.e. fenders)       * VOC = volatile organic compounds


    Industry-leading position                             Industry-leading position                   Industry-leading position




Page 43 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
MaterialScience –
Key Data
                                                                  2nd Quarter       2nd Quarter       Change          FY       FY   Change
 EUR million
                                                                    2010              2011              %          2009    2010       %

 Sales                                                                2,689            2,782             +3.5      7,520   10,154     +35.0

 EBIT                                                                   228              236             +3.5      (266)     780             •

   Special items                                                            0                0                     (140)       0

   EBIT before special items                                            228              236             +3.5      (126)     780             •

 EBITDA                                                                 373              372             -0.3       341     1,356            •

   Special items                                                            0                0                     (105)       0

   EBITDA before special items                                          373              372             -0.3       446     1,356            •

   EBITDA margin before special items                                13.9%            13.4%                        5.9%    13.4%

 Gross cash flow                                                        293              288             -1.7       319     1,058            •

 Net cash flow                                                            62             (15)                  •    849      763       -10.1




Page 44 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Reporting Events and AGM
 Date                                               Event                                             Publication
 Thursday,                                                                                            3rd Quarter 2011 Results
                                                    Investor Conference Call
 October 27, 2011                                                                                     Stockholders’ Newsletter
                                                    China Conference 2011,
 November 16-18, 2011
                                                    Shanghai
 Tuesday,
                                                    Investor Conference Call                          2011 Annual Report
 February 28, 2012
 Thursday,                                                                                            1st Quarter 2012 Results
                                                    Investor Conference Call
 April 26, 2012                                                                                       Stockholders’ Newsletter
 Friday,
                                                    Annual General Meeting
 April 27, 2012
 Tuesday,                                                                                             2nd Quarter 2012 Results
                                                    Investor Conference Call
 July 31, 2012                                                                                        Stockholders’ Newsletter
 Tuesday,                                                                                             3rd Quarter 2012 Results
                                                    Investor Conference Call
 October 30, 2012                                                                                     Stockholders’ Newsletter


Page 45 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
Investor Relations Contacts
Dr. Alexander Rosar
Head of Investor Relations
Phone: +49-214-30-81013
E-mail: alexander.rosar@bayer.com

Dr. Jürgen Beunink                                                                   Ute Menke
Phone: +49-214-30-65742                                                              Phone: +49-214-30-33021
E-mail: juergen.beunink@bayer.com                                                    E-mail: ute.menke@bayer.com

Peter Dahlhoff                                                                       Judith Nestmann
Phone: +49-214-30-33022                                                              Phone: +49-214-30-66836
E-mail: peter.dahlhoff@bayer.com                                                     E-mail: judith.nestmann@bayer.com

Fabian Klingen                                                                       Dr. Olaf Weber
Phone: +49-214-30-35426                                                              Phone: +49-214-30-33567
E-mail: fabian.klingen@bayer.com                                                     E-mail: olaf.weber@bayer.com

Page 46 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011

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Q2 2011 Investor Handout U.S. West Coast Roadshow

  • 1. Second quarter 2011 - Bayer continues positive momentum Werner Baumann, CFO 08/30 – 09/01/11 – U.S. West Coast Roadshow
  • 2. Disclaimer This presentation may contain forward-looking statements based on current assumptions and forecasts made by Bayer Group or subgroup management. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situation, development or performance of the company and the estimates given here. These factors include those discussed in Bayer’s public reports which are available on the Bayer website at www.bayer.com. The company assumes no liability whatsoever to update these forward-looking statements or to conform them to future events or developments. Page 2 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 3. 2nd quarter 2011 – Bayer continues positive momentum Group outlook 2011 projects higher sales and adjusted EBITDA €15bn investment plan through 2013 to maximize value of new product pipeline strength and to realize emerging markets opportunity Two-year group restructuring plan to generate €800m efficiency improvements underway Page 3 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 4. 2nd Quarter 2011 – Bayer Continues Positive Momentum Q2‘11 ∆% Highlights € million € million Sales 9,252 +1 (+5)  Solid business expansion EBITDA - reported 1,906 +6  Adjusted EBITDA improved, good - adjusted 2,035 +6 season for CropScience, slight EBIT expansion at HealthCare, - reported 1,273 +26 MaterialScience remained level yoy - adjusted 1,417 +12 Net income 747 +41  Reported EBIT impacted by net Net cash flow 1,530 -1 special charges of €144m Free operating cash flow 1,232 +4 EPS  2011 Group financial outlook - reported 0.90€ +41 reiterated - core 1.29€ +11 ( ) = Fx & portfolio adjusted Page 4 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 5. 2nd Quarter 2011 – Breakdown By Segment Sales adj. EBITDA ∆% 2010 2011 2010 2011 ∆% (adj.) HealthCare 4,305 4,208 -2 (+2) 1,122 1,156 +3 Pharma 2,748 2,666 -3 (+0.5) 772 807 +5 Consumer Health 1,557 1,542 -1 (+4) 350 349 0 CropScience 1,884 1,943 +3 (+9) 380 471 +24 MaterialScience 2,689 2,782 +3 (+8) 373 372 0 In € million, ( ) = Fx & portfolio adjusted Page 5 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 6. 2nd Quarter 2011 – Emerging Markets Leading The Growth Q2 2011 Group sales by region Emerging Economies +5% USA Emerging +4% Economies¹ ~1,300 20% 36% +7% 20% 36% +4% ~900 +9% 34% +14% ~600 10% ~500 Western Europe Others² +6% +2% Group €9,252m; +5% Emerging Latin Eastern Africa & Asia³ America Europe Middle East In € million, ∆% yoy Fx adjusted ¹ Emerging economies include: Latin America, Asia w/o Japan, Australia, New Zealand, Africa and Middle East incl. Turkey, Eastern Europe ² Others = Japan, Australia, New Zealand, Canada ³ Emerging Asia = Asia w/o Japan, Australia, New Zealand Page 6 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 7. 2nd Quarter 2011 – Cash Flow And Net Debt Development Q2 2011 Cash Flow Net Debt Development In € million In € billion GCF NCF Invest- oFCF +0.3 cont. ments 7.1 7.4 1,532 1,530 298 1,232 ∆% y-o-y +19% -1% -18% +4% Q1´11 Q2´11 Page 7 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 8. Fiscal 2010 – Operating Performance On Track FY‘10 ∆% Highlights € million € million Sales 35,088 +13 (+8)  Achieved group financial targets in EBITDA 2010 - reported 6,286 +8 - adjusted 7,101 +10  Strong year at MaterialScience – EBIT HealthCare and CropScience - reported 2,730 -9 below - adjusted 4,452 +18  Net income diminished by high Net income 1,301 -4 special charges Net cash flow 5,773 +7 Free operating cash flow 4,152 +12  Strong operating cash flow – net EPS financial debt reduced - reported 1.57 -8 - core 4.19 +15 ( ) = Fx & portfolio adjusted Page 8 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 9. Selected Indicators 2006-2010 - Track Record of Performance EBITDA before special items and margin* (€ billion) Core earnings per share* (€) 7.1 6.8 6.9 6.5 5 4.19 5.6 4.17 3.80 3.64 4 2.99 3 19.3% 20.9% 21.1% 20.8% 20.2% 2 0 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010 Net cash flow* (€ billion) Net financial debt*, ** (€ billion) 5.8 20 17.5 5.4 16 14.2 3.9 4.3 12.2 3.6 12 9.7 7.9 8 4 0 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010 * 2006 - 2008 from continuing operations ** year-end data Page 9 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 10. Building A World-Class Innovation Company Page 10 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 11. Building A World-Class Innovation Company Portfolio Growth Productivity Build on leading industry Invest in innovation Decomplex structures position in all 3 capabilities and processes subgroups Maximize value of new Implement two-year Enhance competitive product pipeline strength group restructuring plan position Realize emerging market opportunity Target is to deliver mid-single digit organic sales growth in 2011 and to invest €15bn in growth during 2011 - 2013 Page 11 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 12. Bayer – A Leader in Its Markets €16.9bn HealthCare Pharmaceuticals €10.9bn, leading positions in key categories Consumer Health €6.0bn, OTC pharmaceuticals, blood glucose meters and 50% 30% veterinary medicines, global #2-4 €6.8bn CropScience Agrochemicals and seeds & traits, global #2 in agrochemicals 20% €10.2bn MaterialScience Polyurethanes and polycarbonates, global #1/2 Sales 2010: €35.1bn Break-down excluding reconciliation Page 12 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 13. HealthCare- Pharma Pipeline Maturing What it does Status 1st indication launched/ Cardiology Xarelto inhibits blood clot formation filed; phase III lowers blood pressure in the Riociguat phase III lung inhibits enzymes important for launched, additional Nexavar tumor growth indications in phase II/III Oncology inhibits enzymes important for Regorafenib phase III tumor growth targeted treatment of bone Alsympca trial (phase III) Alpharadin metastases in prostate cancer stopped early on success Diseases inhibits formation of new 1st indication filed; Eye VEGF Trap-Eye blood vessels phase III Page 13 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 14. Xarelto Inhibits the Blood-clotting Process at a Pivotal Stage The blood coagulation cascade  Thromboembolism is the single largest cause of morbidity and mortality in the western world.  Anticoagulant drugs inhibit the coagulation cascade and are the mainstay of antithrombotic therapy.  Current treatment options have limitations: Xarelto  Heparin  parenteral administration  Vitamin K antagonists (e.g. Warfarin)  narrow therapeutic window, slow onset of action, unpredictable pharmacology Page 14 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 15. Xarelto: Addressing Medical Needs Across a Wide Range of Patients Indication Phase III Program Status Stroke Prevention in Atrial Fibrillation (AF) Filed in US, EU VTE-Treatment Filed in EU / US-filing early 2012e Data late 2011e / Sec. Prevention in ACS early 2012e Data reported; VTE-Prevention in further analysis Medically Ill Patients underway VTE-Prevention after elective hip Launched and knee replacement Surgery 1-4 Page 15 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 16. Xarelto Demonstrated an Excellent Clinical Profile in Key Indications 1-4  Superior efficacy: 52% relative risk reduction* VTE prevention after orthopedic surgery (RECORD 1- 4 trials)  Rates of major bleeding low. No statistically significant difference  Comparator: enoxaparin  EINSTEIN-DVT  Non-inferior efficacy - significantly improved net clinical benefit **  Composite of major and clinically relevant non major bleeding similar DVT treatment and with numerically lower major bleedings Extended secondary prevention of VTE (EINSTEIN-DVT and  Comparator: enoxaparin followed by vitamin K antagonist EINSTEIN-Extension  Superior efficacy: 82% reduction of recurrent VTE  EINSTEIN-Extension trial)  Low incidence of major bleeding. No stat. significant difference  Comparator: placebo  Non-inferiority vs. warfarin in ITT and per-protocol population. Active treatment superior to warfarin in reducing the risk of stroke and non-CNS  Stroke prevention in atrial embolism in the safety population. fibrillation  Composite of major and clinically relevant non major bleeding similar (ROCKET-AF trial)  Comparator: vitamin K antagonist Selection of clinical trial results. For full data see publications: VTE prevention after orthopedic surgery (RECORD) data published in NEJM (RECORD 1: Vol 358 2008; RECORD 3: Vol 358 2008) and Lancet (RECORD 2: Vol 372 2008; RECORD 4: Vol 373 2009), extended sec. prevention of VTE (EINSTEIN-Ext.) and DVT treatment (EINSTEIN-DVT) data publiashed in NEJM Vol 363 2010; stroke prevention (ROCKET-AF) data published in NEJM (online August 10, 2010) *) Symptomatic VTE + all-cause mortality in pooled analysis of RECORD 1-4; **) Secondary outcome defined as composite of primary efficacy endpoint plus major bleeding VTE: Venous thromboembolism; DVT: Deep vein Page 16 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011 thrombosis; ITT: Intention to treat
  • 17. VEGF Trap-Eye – Addressing Major Eye Diseases wet AMD Diabetic Macular Edema (DME)  Wet AMD is due to abnormal blood vessel  Most prevalent cause of vision loss in growth in the eye; the disease accounts for patients with diabetes. approx. 90% of AMD-related blindness.  Clinically significant DME is a leading cause  Wet AMD is the leading cause of acquired of acquired blindness in the adults aged blindness in the elderly. <50years.  Approx. 1.5 million patients annually in the  Approx. 370,000 patients suffer from clinically US. significant DME in the US, with 95,000 new cases / year. Central Retinal Vein Occlusion (CRVO) myopic CNV  Obstruction of central retinal vein may lead  In myopic patients, the eyeball is too long – to vision loss and other serious this situation puts strain on retina and may complications. lead to pathological changes (e.g. irregular vessel growth) in the back of the eye.  > 100,000 people in the US and > 66,000 people in key EU countries are estimated to  Severe myopia is common in Asia; in suffer from CRVO. Japan, mCNV is the second most common cause of blindness. AMD: Age-related macular degeneration Page 17 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011 CNV: Choroidal neovascularization
  • 18. VEGF Trap-Eye – Key Data from Clinical Studies Suggest a Competitive Profile  Phase III program incl. 2,457 patients (VIEW 1, VIEW 2) Wet Age-Related Macular  Primary efficacy endpoint met, non-inferiority compared to Lucentis Degeneration (wet AMD)  demonstrated One year data demonstrated potential for less frequent dosing with  comparable vision maintenance  Phase III program incl. 354 patients (COPERNICUS, GALILEO) Central Retinal Vein Occlusion (CRVO)  Primary efficacy endpoint met, demonstrating significant improvement in vision after six months of treatment compared to sham-injections   Phase II study incl. 219 patients (DaVinci) Diabetic Macular Edema  VEGF Trap-Eye vs. laser treatment: (DME) Primary endpoint met: Visual acuity gains over 24 weeks were maintained or numerically improved up to completion of the study at week 52   Phase III trial initiated VEGF Trap-Eye was generally well tolerated and the most common adverse events were those typically associated with intravitreal injections or the underlying disease. Selection of clinical data. For further details see Bayer press releases from November 22, 2010, December 20, 2010 and April 27, 2011. Further data presented at Angiogenesis Conference, Miami, Florida, February 12, 2011.
  • 19. VEGF Trap-Eye – Status of Clinical Program Indication Phase III Program Status Wet age-related macular degeneration (AMD) Filed Central retinal vein occlusion Filing 2012e (CRVO) Diabetic macular edema (DME) Phase III ongoing Myopic choroidal Phase III ongoing neovascularizytion (CNV) Page 19 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 20. Alpharadin – New Opportunities to Treat Bone Metastases  Alpha-pharmaceutical (based on 223Radium, delivering highly energetic, short ranging radiation) - in-licensed from Algeta  Radium as natural bone seeker targeting bone metastases  Phase III in hormone-resistant prostate cancer (HRPC)  ALSYMPCA (phase III) in patients with smptomatic HRPC with sceletal metastases stopped early - Alpharadin demonstrated significant improvement in overall survival vs. placebo  Filing targeted mid 2012e  Fast track status granted by FDA Tumor cells Newly formed bone Bone metastases Radium-223 deposition Radium-223: highly localized tumor cell killing HRPC: Hormone-refractory prostate cancer Page 20 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 21. Expected 2011 Major Pipeline Newsflow Project / Study When expected? Xarelto ATLAS TIMI 51; phase III in secondary Data end 2011e / prevention of acute coronary syndrome (ACS) early 2012 Xarelto EINSTEIN PE; phase III in treatment of PE and Data end 2011e / secondary VTE prevention early 2012 Xarelto Potential newsflow on submissions 2011e Nexavar Phase III in NSCLC and phase III in thyroid Completion end cancer 2011e / 2012e VEGF Trap-Eye Two-year data from wet AMD phase III VIEW 2011e program Page 21 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 22. CropScience - Innovation Leadership in AgChemicals, Promising BioScience Pipeline 23 new agrochemical active ingredients launched, generated sales of €2bn in 2009 2000 - 2009 Six new agrochemical substances with sales potential of more than €1bn to be launched 2010 - 2012E Expect 18 new BioScience products to be launched 2010 - 2016E Numerous early-stage research and early development projects in Crop Protection and BioScience Page 22 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 23. Growth Platform Ag BioScience - Strongly Expanded in 2010 Planned sales development Key growth drivers in € million  Fast growing established business in cotton, canola, rice and vegetables ~1,400 Planned: CAGR 12%  Regional expansion and introduction of new varieties >1,000  Exploit traits potential through licensing agreements 687  Extension of our crop-portfolio to +37% soybean and cereals 503  Increase of BioScience’s share of 240 CropScience R&D expenditures  R&D capacities strengthened through acquisition of Athenix (2009) 2002* 2009 2010 2015 E 2018 E *2002 sales pro-forma Bayer + Aventis CropScience Page 23 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 24. CropScience – Translate R&D More Effectively Into Sales  Realign company activities with a stronger customer focus  Restructure and further invest in global marketing to enable improved commercial execution  Extend use of state-of-the-art customer relationship management tools  Broaden food chain partnership business model  Focus on global flagship brands and deliver packaged solutions to differentiated customer segments Page 24 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 25. MaterialScience – World-Class Applications Research Bayseal ® Baytherm® Creates a seamless air Combines high mechanical barrier system working like a strength with high insulating building envelope capacity and low weight Makrolon® DurFlex® Forming lightweight exterior Improving noise reduction car body parts from and economics of rail track polycarbonate operations Bayblend® FR Bayfol Reflex ® A new safety concept for car Actuators out of polymers batteries to make housings give tactile feedback precisely flame retardant adjusted to requirements Makrofol®ID Baycusan® Film for ID cards providing Solvent-free polyurethane scratch resistance and based polymers for cosmetic protecting against counterfeit applications Page 25 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 26. Opportunity Emerging Markets Page 26 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 27. Emerging Markets – Significant Growth Momentum 2010 Group Sales break down; ∆% yoy Fx adjusted +18% 64% 36% +3% Developed markets Emerging markets1 ¹ Emerging markets include: Latin America, Asia w/o Japan, Australia, Page 27 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011 New Zealand, Africa and Middle East incl. Turkey, Eastern Europe
  • 28. BRIC - Countries Can Collectively Become a 10bn Euro Business in 2015 Sales in € bn ~6.0bn 6 2.9bn 3 >2bn 2 1.6bn ~1.0bn 1 ~0.8bn 0.5bn 0.5bn 0 2010 2015 2010 2015 2010 2015 2010 2015 Page 28 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 29. Bayer is One of The Leading International HealthCare Companies in China Strong growth  Driven by Pharmaceuticals (+17% yoy) HealthCare 2010 €823m +15% y-o-y (Fx-adj.)*  Pharma portfolio includes established branded products as well as innovative products like Nexavar, Scilin Insulin and Xarelto Significant investment commitment  Approx. 5,300 employees (2010)  €100m over 5 years to set-up a global R&D center in China Top products growth in 2010* Glucobay +22%  Beijing manufacturing site expansion Ultravist +16% (~€45m through 2015) Aspirin Cardio +15% Avelox +14%  Partnership with Tsinghua University Adalat +10% (joint drug discovery, student support) All growth rates y-o-y Fx-adj. * People‘s Republic of China Page 29 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 30. CropScience in Brazil – Gained Share in One of the World’s Largest Ag Markets  Brazil is the 2nd largest market for CropScience  Bayer is one of the leading suppliers and growing strongly  Bayer gained market share in each of the past 3 years  2010 Crop Protection performance driven by strong sales increase in insecticides and herbicides, especially with new products  BioScience growth driven by cotton CropScience sales (in €m) seed CAGR  Risk management systems in place to 847 +19% 676 724 limit the potential impact of reduced 421 493 credit availability; established barter 2006 2007 2008 2009 2010 business Page 30 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 31. €1bn New Investment Plan at MaterialScience in China Asia/Pacific is leading the recovery Commitment to growth in China  China already is the world’s largest PCS  €2.1bn investment program in integrated market polymer site in Shanghai, China until 2012  China is set to become the world’s largest PUR  New investment of approx. €1bn in Shanghai market by 2015 by 2016 to  Increase MDI capacity to 1,000kt/year  More than double PCS capacity to 500kt/year  Increase HDI capacity, new 50kt/year line planned  Transfer of PCS Headquarters from Leverkusen to Shanghai  Increasing downstream presence (investment of €110m by 2012) PCS = Polycarbonates PUR = Polyurethanes Page 31 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 32. More Innovation Less Administration Page 32 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 33. Restructuring Program Initiated Contribution by Subgroup Savings Initiative  Savings and efficiency initiative at Holding & Admin. HealthCare, CropScience and HealthCare corporate level ~12%  Annual cost savings of €800m starting 2013, reinvestment of ~50%  One-time-charges of around €1bn by ~54% ~34% end of 2012  Plans include reductions of 4,500 people CropScience  2,500 new hires in growth and innovation, particularly in emerging markets Page 33 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 34. Efficient Use of Cash  Funding organic growth  CapEx budget 2011: €1.5bn for PPE  Deleveraging balance sheet  Compliant with single A credit rating category  Cash return to shareholders  Dividend policy: Pay out 30-40% of Core EPS  Share buyback: No priority  Acquisitions  Focus is on organic growth, complemented by bolt-on acquisitions Page 34 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 35. Full Year 2011 – Group Outlook Sales ∆ Fx and portfolio adjusted, EBITDA pre-special items 2011E 2011E 2010 ∆ Original Update Sales 4-6% 5-7% to (Fx & portf. €35.1bn +8% adjusted) €35-36bn €36-37bn adj. Improve toward €7.1bn +10% > €7.5bn EBITDA €7.5bn Core EPS €4.19 +15% ~10% ∽15% Outlook depends on specific planning assumptions as detailed in the Annual/ Quarterly Report Page 35 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 36. Full Year 2011 – Guidance By Subgroup – Q2 Update Unchanged: HealthCare Low- to mid-single digit increase of sales and small increase of adj. EBITDA Unchanged: Pharma Low- to mid-single digit increase of sales and improvement of adj. EBITDA-margin Consumer Unchanged: Health Mid-single digit growth of sales and adj. EBITDA Unchanged: High-single-digit percentage higher sales and growth of adj. CropScience EBITDA by about 20% - or more if the season progresses well in 2nd half Updated: High-single-digit percentage raise of sales. Adj. EBITDA still MaterialScience expected to increase at a higher rate than sales, although we regard this target as increasingly ambitious. Q3’11: Sales and adj. EBITDA in line with prior-year level Outlook based on Fx and portfolio adj. sales and EBITDA pre-special items Outlook depends on specific planning assumptions Page 36 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011 as detailed in the Annual/ Quarterly Report
  • 37. Appendix Page 37 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 38. 2011 – R&D and CapEx Budgets R&D 2011E: ~€3.1bn CapEx (PPE) 2011E: ~€1.5bn HealthCare MaterialScience HealthCare MaterialScience 2.1bn 0.2bn 0.4bn 0.6bn thereof Pharma 1.8bn 8% 8% CropScience 26% 44% 0.7bn 24% 24% 67% 12% 67% 1% 18% Reconciliation Reconciliation CropScience 0.05bn 0.2bn 0.3bn €15bn R&D and Capital Investment Plan until 2013 2013 €15bn R&D and Capital Investment Program until Page 38 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 39. HealthCare – Business Set-up Pharmaceuticals Consumer Care Medical Care Animal Health • Specialty Medicine • Non-prescription • Blood glucose • Food animal drugs monitoring systems products • General Medicine and accessories • Vitamins and • Companion nutritional • Medical devices animal products supplements (imaging and therapeutic procedures) Leading positions in certain Global # 2 A leader in medical devices Global # 4 therapeutic categories Page 39 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 40. HealthCare – Key Data 2nd Quarter 2nd Quarter Change FY FY Change EUR million 2010 2011 % 2009 2010 % Sales 4,305 4,208 -2.3 15,988 16,913 +5.8 Pharmaceuticals 2,748 2,666 -3.0 10,467 10,908 +4.2 Consumer Health 1,557 1,542 -1.0 5,521 6,005 +8.8 EBIT 595 786 +32.1 2,640 1,861 -29.5 Special items (189) (51) (372) (1,169) EBIT before special items 784 837 +6.8 3,012 3,030 +0.6 EBITDA 1,065 1,105 +3.8 4,148 4,116 -0.8 Special items (57) (51) (320) (289) EBITDA before special items 1,122 1,156 +3.0 4,468 4,405 -1.4 EBITDA margin before special items 26.1% 27.5% 27.9% 26.0% Gross cash flow 759 760 +0.1 3,153 2,948 -6.5 Net cash flow 666 636 -4.5 3,431 3,320 -3.2 Page 40 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 41. Crop Science – Business Set-up Crop Protection Environmental Science BioScience • Insecticides • Professional Products • Seeds & Traits • Fungicides • Consumer Products • Herbicides • Seed Treatment Global # 2 The leader in this area Committed emerging player – access to technologies Page 41 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 42. CropScience – Key Data 2nd Quarter 2nd Quarter Change FY FY Change EUR million 2010 2011 % 2009 2010 % Sales 1,884 1,943 +3.1 6,510 6,830 +4.9 Crop Protection / BioScience 1,685 1,757 +4.3 5,927 6,180 +4.3 Environmental Science 199 186 -6.5 583 650 +11.5 EBIT 187 272 +45.5 798 261 -67.3 Special items (66) (81) (219) (526) EBIT before special items 253 353 +39.5 1,017 787 -22.6 EBITDA 314 405 +29.0 1,311 767 -41.5 Special items (66) (66) (197) (526) EBITDA before special items 380 471 +23.9 1,508 1,293 -14.3 EBITDA margin before special items 20.2% 24.2% 23.2% 19.0% Gross cash flow 224 304 +35.7 1,043 546 -47.7 Net cash flow 782 823 +5.2 745 1,399 87.8 Page 42 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 43. Material Science – Business Set-up Coatings, Adhesives, Coatings, Adhesives, Polycarbonates Polycarbonates Polyurethanes Polyurethanes Specialties Specialties • Application in automotive • Rigid foams are used for • Input materials for coatings, (i.e. for weight reduction) insulation in construction, logistics adhesives and the cold chain • Construction • Coatings for vehicles, industrial (i.e. integrated heat and light • Elastic foams are used for comfort coatings, corrosion protection applications for furniture, car and management) other vehicle seats and • Adhesives for various applications • Electronics & IT mattresses • Functional films and development • CD/DVD/Blu-ray • Further applications include businesses equipment housing or structural parts in automotive (i.e. fenders) * VOC = volatile organic compounds Industry-leading position Industry-leading position Industry-leading position Page 43 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 44. MaterialScience – Key Data 2nd Quarter 2nd Quarter Change FY FY Change EUR million 2010 2011 % 2009 2010 % Sales 2,689 2,782 +3.5 7,520 10,154 +35.0 EBIT 228 236 +3.5 (266) 780 • Special items 0 0 (140) 0 EBIT before special items 228 236 +3.5 (126) 780 • EBITDA 373 372 -0.3 341 1,356 • Special items 0 0 (105) 0 EBITDA before special items 373 372 -0.3 446 1,356 • EBITDA margin before special items 13.9% 13.4% 5.9% 13.4% Gross cash flow 293 288 -1.7 319 1,058 • Net cash flow 62 (15) • 849 763 -10.1 Page 44 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 45. Reporting Events and AGM Date Event Publication Thursday, 3rd Quarter 2011 Results Investor Conference Call October 27, 2011 Stockholders’ Newsletter China Conference 2011, November 16-18, 2011 Shanghai Tuesday, Investor Conference Call 2011 Annual Report February 28, 2012 Thursday, 1st Quarter 2012 Results Investor Conference Call April 26, 2012 Stockholders’ Newsletter Friday, Annual General Meeting April 27, 2012 Tuesday, 2nd Quarter 2012 Results Investor Conference Call July 31, 2012 Stockholders’ Newsletter Tuesday, 3rd Quarter 2012 Results Investor Conference Call October 30, 2012 Stockholders’ Newsletter Page 45 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011
  • 46. Investor Relations Contacts Dr. Alexander Rosar Head of Investor Relations Phone: +49-214-30-81013 E-mail: alexander.rosar@bayer.com Dr. Jürgen Beunink Ute Menke Phone: +49-214-30-65742 Phone: +49-214-30-33021 E-mail: juergen.beunink@bayer.com E-mail: ute.menke@bayer.com Peter Dahlhoff Judith Nestmann Phone: +49-214-30-33022 Phone: +49-214-30-66836 E-mail: peter.dahlhoff@bayer.com E-mail: judith.nestmann@bayer.com Fabian Klingen Dr. Olaf Weber Phone: +49-214-30-35426 Phone: +49-214-30-33567 E-mail: fabian.klingen@bayer.com E-mail: olaf.weber@bayer.com Page 46 • Bayer Investor Presentation • US West Coast Roadshow • Werner Baumann, CFO • Aug/Sep 2011