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A growing and aging world population and the increasing strain on nature’s ecosystems are among the major challenges facing humanity. As a global leader in health and nutrition, we are able to play a key role in devising solutions to tackle these challenges.
Guided by our purpose “Science for a better life”, we deliver breakthrough innovations in health care and agriculture. We contribute to a world in which diseases are not only treated but effectively prevented or cured, in which people can take better care of their own health needs, and in which enough agriculture products are produced while respecting our planet’s natural resources. That's because at Bayer, we believe that growth and sustainability should go hand in hand. In short, we are working to make our vision “Health for all, hunger for none” a reality.
Our strategy as a diversified life science company remains unchanged, especially in the current situation, with the systemic relevance and resilience of our businesses becoming particularly evident in the face of the global COVID-19 pandemic. At the same time, the pandemic has accelerated a number of trends, meaning that we need to execute our strategy and implement the transformation of our company at a faster pace.
We focus on four strategic levers to deliver attractive returns for our shareholders while also making a positive contribution to society and the environment:
1. We develop innovative products and solutions and leverage cutting-edge research to address unmet societal challenges. As part of these endeavors, we are improving our access to innovation by collaborating with third parties. In addition, we are working on disruptive technologies, for example through our Leaps by Bayer activities, while also continuing to drive the digitalization of our entire value chain.
2. We drive the operational performance of our business by optimizing our resource allocation. Alongside our ongoing efficiency and structural measures, we have also launched a program to accelerate our transformation.
3. Sustainability is an integral part of our business strategy, operations and compensation system. We make a positive contribution to society and the environment. Our ambitious targets for 2030 are fully in step with the United Nations’ Sustainable Development Goals and the climate targets of the Paris Agreement.
4. As a global leader in health and nutrition, we continue to develop our business. We create value with strategy-based resource allocation focused on profitable growth. We are active in regulated and highly profitable sectors that are driven by innovation and in which we have the objective to grow ahead of the competition.
These four strategic levers underpin the strategies of our divisions:
Global agriculture and food systems are confronted with major challenges, such as climate change, water scarcity and population growth. At the same time, megatrends in e-commerce, digital ecosystems, food security and alternative energy are driving a structural transformation of agricultural markets. The sector has to meet the needs of a growing population while at the same time promoting sustainability and protecting our ecosystems.
By leveraging our R&D expertise and leading positions in seeds, traits, crop protection and digital farming, we are actively addressing the challenges our industry is facing.
Our near- to medium-term growth will primarily be driven by product innovations in crop protection, seeds and traits. To fuel long-term growth, we are also tapping into new business areas such as digital farming. Our leading position in this field allows us to tailor the solutions we offer our customers, automate processes and increase the productivity of our R&D pipeline. We are digitally connecting farms, creating an industry-wide ecosystem aimed at bringing new pools of value to our customers. In the longer term, our data-based models and digitally enabled services will supplement or in some cases replace what is currently our core business.
We see this optimized form of agriculture in the future as part of the solution to the growing loss of biodiversity and increasing climate change. At the same time, it also needs to produce enough healthy food at affordable prices.
To increase food security, we aim to empower 100 million smallholder farmers in low- and middle-income countries by improving access to agronomic knowledge, products, services and partnerships. We will do this by expanding our product and service portfolio, including with tailored digital solutions. As part of this endeavor, we are also partnering with research institutes, nongovernmental organizations, companies and social start-ups.
We also aim to reduce the environmental impact of crop protection by 30% in key cropping systems and decrease field greenhouse gas emissions by 30% in the most emitting cropping systems that we serve by 2030. In late July, we launched our Bayer Carbon Initiative which rewards farmers in Brazil and the United States for adopting climate-smart practices such as no- or low-till farming and the use of cover crops. This program is enabled by our digital platform and serves as a tangible step toward delivering on our goals.
Throughout the world, an aging population is leading to a growing number of chronic diseases and the increased occurrence of multiple conditions. The convergence of biology and data science will be a key element for innovation in Pharmaceuticals. Digital technologies can transform the way health care is delivered, while cell and gene therapy has the potential to cure severe diseases. Furthermore, the pandemic has accelerated the digital transformation of health care provision.
We are helping to drive medical progress through our focus on researching, developing and marketing innovative medicines. Our near- to medium-term growth is driven by key products, such as Xarelto™ and Eylea™, and will be further fueled by several promising late-stage R&D pipeline candidates, such as finerenone, and recently launched products, such as VerquvoTM and Nubeqa™. To safeguard long-term growth, we continue to invest in R&D in therapeutic areas with a substantial need for innovation. Moreover, we are expanding our efforts to access external innovation through research collaborations and in-licensing, capturing continued growth opportunities in biologics and novel technologies.
Building on the acquisition of BlueRock Therapeutics LP, United States, and strengthened internal capabilities in cell and gene therapy, we have established an independent strategic unit for cell and gene therapy. We significantly strengthened this unit with the acquisition of Asklepios BioPharmaceutical, Inc. (AskBio), United States, a biopharma company specialized in the R&D and manufacturing of gene therapies across different therapeutic areas, which adds an industry-leading, adeno-associated virus (AAV)-based gene therapy platform with demonstrated applicability and a number of preclinical and clinical-stage candidates. We aim to further accelerate the implementation of our long-term innovation strategy.
Our sustainability agenda includes improving access to medicines. We are therefore applying tiered pricing principles globally, in order to set price levels according to a country’s ability to pay. Another key focus is on improving women’s health and strengthening their role in society by helping to promote gender equality and women’s economic participation. As part of this endeavor, we are leveraging our leading position in women’s health and are aiming to provide 100 million women in low- and middle-income countries with access to modern contraception by 2030. This includes partnerships such as The Challenge Initiative through Johns Hopkins University, together with the Bill & Melinda Gates Foundation, that supports family planning in poor urban settlements. In addition, we remain committed to combating neglected tropical diseases and noncommunicable diseases (such as through the Ghana Heart Initiative).
Rising health care costs, changing demographics and evolving health awareness of consumers continue to make self-care more relevant, and are expected to fuel solid long-term growth in the consumer health care market. The COVID-19 pandemic has further raised awareness about the importance of self-care and accelerated the move toward digitalization, as well as driving growth in categories like nutritional supplements.
We provide consumers with products, services and information that empower them to transform their everyday health. Our strategy focuses on our core categories, as well as the transition of prescription medicines to nonprescription status. We drive profitable growth through excellence in the development of innovative solutions and through execution excellence in marketing, sales and product supply.
The digital transformation and our sustainability agenda are the accelerators driving forward the implementation of our strategy at Consumer Health.
We are digitalizing all areas of our operations, including marketing, sales, supply chain and R&D to engage better with consumers, customers, and healthcare professionals while driving efficiency and flexibility. In addition, we are pursuing an agile innovation model with external partners to discover new sources of growth. By acquiring a majority stake in Care/of, a personalized nutrition company, we have gained access to a new business model that enables us to provide consumers with individual, tailored solutions.
Moreover, our sustainability ambition has two focus areas. Firstly, it focuses on expanding access to everyday health for 100 million people in underserved communities. Secondly, it focuses on investing in sustainable solutions to support a healthier planet by 2030. We have embedded the sustainability strategy into our operating model across the entire value chain.