Meet Management 2012 Investor Handout

Meet Management March 2012 I Leverkusen

Investor Presentation

Disclaimer

This presentation may contain forward-looking statements based on currentassumptions and forecasts made by Bayer Group or subgroup management.Various known and unknown risks, uncertainties and other factors could lead tomaterial 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 areavailable on the Bayer website at www.bayer.com. The company assumes noliability whatsoever to update these forward-looking statements or to conformthem to future events or developments.

• Bayer Investor Presentation • Meet Management • March 2012

• Bayer Investor Presentation • Meet Management • March 2012 Page 1

Bayer –Science For A Better Life

Mid-term targets show significant further value generation potential

Market leading positions in vast majority of portfolio

New product pipeline strength in Pharma, CropProtection & BioScience

Strong and profitable growth in emerging markets, especially China

Unique opportunity at the interfaces of human, animal and plant health

Group wide excellence initiatives to further boost earnings and free-up growth resources

Incentive systems aligned to business specific challenges

EBITin € million

+52%

FY´10 FY´11

4,149

2,730


Salesin € million% portfolio & currency adj.

+6%

FY´10 FY´11

36,52835,088

EBITDAadjusted*in € million

+7%

FY´10 FY´11

7,6137,101

Core EPSin €

+15%

FY´10 FY´11

4.834.19

Page 2

Full Year 2011 –Record Sales and EBIT

*before special items


2007 – 2011A Period of Significant Progress

* 2007 - 2008 from continuing operations

6.8 6.96.5

7.1

2007 2008 2009 2010 2011

7.6

Page 3

Sales (€ billion)

3.804.17

3.644.19

3

4

5

6

2007 2008 2009 2010 2011

4.83

EBITDA before special items* (€ billion) Core earnings per share* (€)

20.921.1

20.8

20.2

20

21

22

2007 2008 2009 2010 2011

20.832.4 32.9

31.2

35.1

2007 2008 2009 2010 2011

36.5

EBITDA before special items margin* (%)


2007 – 2011Consistent Strong Cash Generation

Trade working capital to sales ratio (%)

Net financial debt** (€ billion)

*2007 - 2008 from continuing operations ** year-end data

4.33.6

5.4 5.8

2007 2008 2009 2010 2011

5.1

29.631.2 30.4

26.4

20

25

30

35

40

2007 2008 2009 2010 2011

26.4

Page 4

4.8

5.3

4.74.8

2007 2008 2009 2010 2011

5.2

Gross Cash Flow* (€ billion)

12.214.2

9.7 7.9

0

4

8

12

16

20

2007 2008 2009 2010 2011

7.0

Net Cash Flow* (€ billion)


2012 –

Financial Outlook

Outlook 2012 –Planning Assumptions


2.6

0.7

1.7

3.3

4.84

3

2

1

5.15

Global economic/political risks remain high

Outlook for economic growth marked by uncertainty

Positive signals for North America, in Europe we expect slower expansion in 2012 than 2011

Asian emerging markets continue to drive growth

$/€ 1.40, 1% depreciation of Euro increases sales by ~€70m and EBITDA by ~€20m

Crude oil: average $110/bbl (Brent)

GDP growth by regions in % vs previous yer

Outlook 2012 –Planning Assumptions


Expected 2012 Global Market Development

5% Electro/electronicRobust growth

27% Rx-pharmaMid-single digit growth, driven by emerging markets

10% OTC-pharmaLow- to mid-single digit growth 3% Diabetes care

low-single digit growth

3% Animal HealthModerate growth

20% Agrochemicals/SeedsPositive development

6% AutomotiveRobust growth

6 % ConstructionOngoing recovery

5% Furniture/woodOngoing recovery,small growth

15% Others

2011 Group sales break-down in %, growth estimates in %


2011 ∆ vs. 2010 2012E

Sales €36.5bn +6% +~3% or~€37bn*

Adj. EBITDA €7.6bn +7% Slightly improve

Core EPS €4.83 +15% Slightly improve

Sales ∆ Fx and portfolio adjusted, EBITDA before special items

Fiscal 2012 Outlook Projects Further Growth And Higher Earnings

*Assuming Fx rate of $1.40 per €Outlook depends on specific planning assumptions as detailed in the Annual Report


HealthCare Expect sales to increase by low- to mid-single-digit percentage. Plan to slightly improve adj. EBITDA .

Pharma Expect sales to remain stable or move slightly higher, and adj. EBITDA to approx. match prior year level.

Consumer Health

Anticipate mid-single-digit percentage growth of sales and adj. EBITDA.

CropScience Plan to grow above market and to increase sales and adj. EBITDA by mid-single-digit percentages.

MaterialScience

Expect sales and adj. EBITDA to remain level with prior year. Should market develop more favorably than anticipated, we expect sales and earnings to increase accordingly. Q1’12: Expect sales to be roughly level with Q4’11 and adj. EBITDA to be well above Q4’11 but below Q1’11.

Sales ∆ Fx and portfolio adjusted, EBITDA before special itemsOutlook depends on specific planning assumptions as detailed in the Annual Report

Fiscal 2012 –Guidance By Subgroup


Strategic Priorities


Building A World-Class Innovation Company

Page 11

Portfolio ProductivityGrowth

Enhance competitive position

Strengthen LifeSciences

Intensify cooperation & licensing activities

Exploit synergy potential of human, animal and plant health

Invest in innovation capabilities

Maximize value of new product pipeline strength

Leverage competitive advantage of new TDI gas phase technology

Realize emerging market opportunity

Decomplexstructures and processes

Implement two-year group restructuring plan

Further adjust business processes at MaterialScience to ongoing commoditization


Two Distinct Business Models

Page 12

LifeSciences Product innovation,

R&D-ratio ~11% of sales

COGS relatively low,selling & distribution relatively high

High profitability,adj. EBITDA-margins23-27%*

Increasing generic competition & government intervention

Structural risk: approvals, meta-analysis, product liability

MaterialScience

Breakdown excl. Reconciliation*EBITDA before special items in % of sales, 2011

**Selling, administration and R&D

Sales2011

Process innovation,capital intensive

COGS high (~79%) marketing & selling relatively low (SAARE** ~11%)

Lower profitability, adj. EBITDA margins ~11%*

Few competitors, new entrants from Asia, Middle East

Cyclical risk: demand and supply fluctuationsAdj. EBITDA

2011

31%

69%

16%

84%


Mid-term Targets


HealthCare –Building Growth Momentum

Priority Target 2014

Accelerate growth HealthCare sales of ~€20bn

Pharma: Successfully commercialize late-stage pipeline and realize emerging markets (EM) opportunity

Sales of ~€11.5bn High-single to low-double-digit % EM

growth

Consumer Health: Aspire to become world-leading OTC company Sales of ~€8.5bn

Improve profitability HealthCare margin* of ≥28% Pharma margin* of >30% Consumer Health margin* of ~25%

*EBITDA before special items to sales in %


CropScience –Propelling Future Growth

Priority Target 2014 (normal market conditions)

Above market growth >€8bn sales

Translate R&D effectively into sales New crop protection product sales (=launched since 2006) of ~ €1.5bn

Extend BioScience footprint Aspiration to grow business in-line with

average of last 3 years, i.e. CAGR ~20% p.a.

Improve profitability Generate adj. EBITDA* margin of ~24%

*EBITDA before special items to sales in %


MaterialScience –Earn A Premium Over Cost of Capital

Priority Performance Targets

Growth Grow business (volume) above global GDP

Leadership Defend #1 market positions in polycarbonates and MDI

Leverage competitive advantage of TDI gas-phase technology

Increase market share of TDI business (2011: 23-24%*)

Closely monitor timing and necessity of capital investments

CapEx (PPE) budget of €1.5-2bn until 2014

Expand Caojing, China site Establish world-scale facilities in Germany

Earn a premium over cost of capital CFRoI after reproduction > WACC

*by volume


New Incentive Scheme Reflects Business Specific Challenges

Group

Performance

Subgroup

Performance

Individual

Performance

IndividualBusinessTargets

HealthCare Sales growth & adj.

EBITDA* margin, innovation

CropScience Sales growth & adj.

EBITDA* margin; relative performance vs. peers, innovation

MaterialScience CFRoI vs. cost of capital,

process innovation

Core EPS

++



Innovation

Pharma Pipeline –2011 - Significant Progress Achieved


Project Indication Peak Sales Potential

Status & Targets

Xarelto Cardiology / Anticoagulation

> €2bn SPAF: launched (US, EU, others) DVT treatment and sec. prevention: launched VTE prev. ORS: launched in US Sec. prev. ACS: filed

VEGF Trap-Eye

Ophthalmology / Inhibition of blood vessel growth

≥ €1bn Filed for wet AMD in EU and Japan Phase III for DME and wet AMD (China)

initiated Positive phase III data in CRVO

Alpharadin Oncology / Targeting of bone metastases

≥ €1bn CR prostate cancer: 44% improvement of OS Fast track designation by FDA Filing target: mid 2012

Regorafenib Oncology / Oral multi-kinase inhibition

≥ €1bn Metastatic colorectal cancer: 29% improvement of OS

Fast track designation by FDA Filing target: 1H 2012

SPAF: stroke prevention in atrial fibrillation; DVT: deep vein thrombosis; ORS: orthopedic surgery; ACS: acute coronary syndrome; VTE: venous thromboembolism

AMD: age-related macular degeneration; DME: Diabetic macular edemaCRVO: central retina vein occlusion; CR: castration refractory; OS: overall survival

Crop Protection –Pipeline with €2bn Sales Potential

Launches 2011–2015e*


2011 Peak salespotential

Insecticide

Fungicide

Fungicide

Herbicide

SeedTreatment

Herbicide

Seed Treatment

Triafamone

Sivanto~ 0.2

~ 2.0

* subject to regulatory approval

Sales in €bn from launches 2011-2015e


Paradigm: Mammals and crops differ substantially from each

other► Strong silo mentality in research

Paradigm: There is more common ground between mammals and

crops than assumed before► Growing interest of researchers in different species

(„cross fertilization“)

New Technologies

New Perspectives

New LifeSciences’ Technologies Allow For A Stronger Cross-Fertilization

… to a multi-species research approachFrom a species-oriented research …

Animal Health Plant Health Animal Health Plant HealthHuman HealthHuman Health


OpportunityEmerging Markets


Africa & Middle East

EasternEurope

Emerging Markets –Sales Growth Well Above Global Average

Emerging Economies

EmergingEconomies¹

+9%

Others²+4%

USA+3%

Western Europe+4%

FY2011 Group Sales by Region

Group €36,528m; +6%

~4,300

+12%~5,100

+5%

~1,800

+9%~2,100

+12%

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, Canada³ Emerging Asia = Asia w/o Japan, Australia, New Zealand

In € million, ∆% yoy Fx adjusted

36%

11%34%

19%

Latin America

Emerging Asia³


= Developed Markets

HealthCare CropScience MaterialScience

+10% +11% +7%= Emerging Markets1

FY 2011 Group sales breakdown; ∆% yoy Fx adjusted

¹ Emerging markets: Latin America; Asia/Pacific w/o Japan, Australia,New Zealand; Africa and Middle East incl. Turkey; Eastern Europe

43%32% 42%

Emerging Markets –All Subgroups Have Strong Foothold

All BRIC-Countries in Our Most Important Country Portfolio

* Greater China includes PR China, Hong Kong, Macau and Taiwan• Bayer Investor Presentation • Meet Management • March 2012

FY 2011 sales in € billion; ∆% yoy Fx adjusted

Page 25

*

+3%+5%

+4%

+3%

+13%

+5%+5%

2.0

1.0+10%

+11% +14%+15%

3.0

4.0

+2%

-2%

+1%


Bayer in Greater China – Key Facts

Sales Bayer FY 2011In € million

€2,957m58%BMS

5%BCS

37%BHC

€36,528m

8%China: €2,957m

EmployeesBayer Greater China (FTE)

Sales DevelopmentBayer Greater China (in € billion)

2009 2010

10,0018,350

10,924

2011 2006

1.5

20102009

2.1

2008

1.9

2007

1.8

3.0

2011

2.9

Greater China: PR China, Hongkong, Macao, Taiwan


China - A Growth Engine for Bayer

3.0bn

~6.0bn

2011 2015e

~19% p.a.

Sales Greater China in €bn

HealthCare 1.1 ~2.5CropScience 0.1 ~0.3MaterialScience 1.7 ~3.0

Group Sales Target 2015 Expansion in All Subgroups

Well positioned to capture opportunities in one of the world´s fastest-growing economies

Sales targets by subgroup:

€bn 2011 2015e


Efficiency

Contribution by Subgroup

Restructuring Program Fully On Track


Target: €800m annual cost savings by 2013

Reinvestment of ~50%

One-time-charges of approx. €1bn of which €803m booked in 2010/11

Plans include staff reductions of 4,500

2,500 new hires in growth and innovation, particularly in emerging markets

Measures with €543m annualized savings already implemented by end

of 2011

CropScience

HealthCareHolding & Admin.

~54%

~34%

~12%

€800m€800m

Full Year 2012 –R&D And CapEx Budgets


1%

MaterialScience0.2bn

HealthCare2.0bnthereof Pharma 1.5bn

MaterialScience0.5bn

HealthCare0.5bn

Reconciliation0.05bn

67%

24%

8%

Reconciliation0.2bn

CropScience0.8bn

CropScience0.3bn

CapEx (PPE) 2012e: ~€1.5bnR&D 2012e: ~€3.0bn

25%

66%

8% 34%

20%

33%

13%


Appendix


Financial Performance –

Q4 2011

4th Quarter 2011 –Mixed Business Performance


Q4‘10 Q4‘11 ∆%€ million € million

Sales 9,012 9,191 +2 (+2)

EBITDA- reported 1,510 1,415 -6

- adjusted* 1,689 1,541 -9

EBIT- reported 51 629 •

- adjusted* 1,005 844 -16

Net income -145 397 •

NCF 1,941 1,152 -41

oFCF 1,417 427 -70

EPS- reported -0.18 0.48 •

- core 0.95 0.97 +2

Highlights of Financial Results

Top-line driven by ConsumerHealth andCropScience

Emerging Markets sales up 5%

Improvement of reported EBIT due tolower special charges

Adj. EBITDA* declined due to a sharp drop at MaterialScience

Net cash flow impacted by payments in connection with LL Rice (€484m)

( ) = Fx & portfolio adjusted


4th Quarter 2011 –HealthCare


Pharma+1% (+1%)

ConsumerHealth

+5% (+5%)36%

Q4’11 Sales

HealthCare €4,595m; +3% (+2%)

2,6801,915

Price1%

Volume2%

Fx0%

Portfolio0%

In € million, ∆% yoy, () = Fx & portf. adjusted

Earnings

Q4‘10 Q4‘11 Q4‘10 Q4‘11

Adj.EBITDA*

Adj.EBIT*

771 758

367 422

-2%

+15%

1,138 1,180 +4%

231 +37%

772 815 +6%

541 498 -8%

317


4th Quarter 2011 –CropScience


Crop Protection /BioScience+2% (+4%)

EnvironmentalScience

-5% (-6%)36%

CropScience €1,676m; +1% (+3%)

1,528148

270 273 +1%

Q4‘10 Q4‘11 Q4‘10 Q4‘11Price-1%

Volume3%

Fx0%

Portfolio-1%

144 145

Adj.EBITDA*

Adj.EBIT*

+1%

Q4’11 Sales In € million, ∆% yoy, () = Fx & portf. adjusted

Earnings


4th Quarter 2011 –MaterialScience


36%

MaterialScience €2,596m; 0% (0%)

1,341667

420

168

**CAS: Coatings, Adhesives, Specialties*** IO: Industrial Operations

Polyurethanes+5% (+5%)

Polycarbonates-9% (-10%)

CAS**0% (-1%)

Price4%

Volume-4%

Fx0%

Portfolio0%

IO***+13% (+11%)

297

106 -64%

Q4‘10 Q4‘11 Q4‘10 Q4‘11

156

-48

Adj.EBITDA*

Adj.EBIT*

•

Q4’11 Sales In € million, ∆% yoy, () = Fx & portf. adjusted

Earnings



+€25m

4th Quarter 2011 –Cash Flow And Net Debt Development

Q4’11 Cash Flow Net Debt Development

7.0

GCF oFCF

1.004

Invest-ments

725 427

∆ %y-o-y -29 -70

NCFcont.

1,152

-41 +38Q3´11 Q4´11

7.0

Cash Flow in € million, Net Debt in € billion,


Financial Performance –

Fiscal 2011

2011 Outlookoriginal

2011actual

2011∆ Comments

Sales 4-6% to €35-36bn €36.5bn +6% Raised to 5-7% or €36-37bn

in Q1

Adj. EBITDA

increase towards €7.5bn

€7.6bn +7% Raised to >€7.5bn in Q1

Core EPS Increase by~10% €4.83 +15% Raised to ~15% in Q1

Net Debt reduce €7.0bn -€0.9bn Record GCF

Fiscal 2011 –All Group Targets Achieved


Sales ∆ Fx and portfolio adjusted, EBITDA before special items

Fiscal 2011 –Subgroup Performance vs. Targets


in € million 2011 Outlook original

2011actual adj. ∆ Comments

HealthCare Targets achieved or exceeded Top-line driven by Consumer

Health Pharma margin up 140 bpts.

Sales low/mid single-digit increase

17,169 +2%

Adj. EBITDA* small improvement 4,702 +7%

CropScience

Achieved or exceeded all targetsSales ≥ mid-single digit increase 7,255 +9%

Adj. EBITDA* grow at higher rate than sales 1,654 +28%

MaterialScience Sales growth above, bottom-line clearly below expectations

Pressure from higher raw material prices and deteriorating business environment

Sales mid single-digit increase 10,832 +8%

Adj. EBITDA* grow at higher rate than sales 1,171 -14%


Investor Handout – Meet ManagementBayer HealthCare

March, 2012 – Leverkusen

Leading Positions in Key Healthcare Markets

• Bayer Investor Presentation • Meet Management • March 2012Page 2

Sales Split by Segment 2011Sales in € million

25%

58%

7%

20%

14%

Pharma€9,949m Leading positions in key therapeutic categories

HealthCare €17,169m

Consumer Care €3,534m Global #2 in OTC-pharmaceuticals

Medical Care €2,500m #1 in fluid injection systems, #1 in contrast media,

#4 in blood glucose meters

Animal Health €1,186m Global #4

Sales 16,913 17,169 +1.5

EBIT 1,861 3,191 +71.5

EBIT adjusted* 3,030 3,367 +11.1

EBITDA adjusted* 4,405 4,702 +6.7

Gross cash flow 2,948 3,254 +10.4

Net cash flow 3,320 3,357 +1.1

CapEx 605 611 +1.0

Free operating cash flow 2,747 2,749 +0.1

R&D expenses 2,066 1,948 -5.7

Capital invested (average) 23,022 22,757 -1.2

CFRoI 12.8 % 14.3 % ●

Fiscal 2011 –Key Financials HealthCare

• Bayer Investor Presentation • Meet Management • March 2012Page 3 * before special items

In € million FY 2010 FY 2011 ∆%

Fiscal 2011 -Operating Performance


EarningsSales

25%

42%

58%

HealthCare €17,169m +1.5% (+2%)

ConsumerHealth+4% (+5%)

2010 2011

AdjustedEBITDA*

4,4054,702

2,832 2,972

1,573 1,730

2010 2011

AdjustedEBIT*

3,0303,367

1,900 2,042

+7%

+5%

+10%

+11%

+7%

+17%

Price+0.2%

Volume+2.2%

Fx-1.2%

Portfolio0.3%

Sales in € million; ∆% y-o-y, () Fx & portfolio adj.

* before special items

Pharma0% (+1%)

1,130 1,325

Fiscal 2011 -Regional Sales Split


Consumer HealthPharmaceuticals

€ 9,949m

Europe -3.5%

North America -10.5%

LA / Africa / Middle East

+11.3%

Asia/Pacific +11.8%

Sales in € million; ∆% y-o-y, Fx adj.

21% 17%

25%

37%

€ 7,220m

Europe +4.8%

North America +6.0%

LA / Africa / Middle East

+8.3%

Asia/Pacific +4.4%

32%

15%

16%

38%

Fiscal 2011 - Strong Business Momentum in Emerging Markets


Emerging Economies

25%

2011 HealthCare Sales

HealthCare €17,169m LatinAmerica

Eastern Europe


~1,700

+13%

~1,900

+11%

~1,000

+6%

~886

+9%


23%

USA-2%

31%

32%

14%

Sales in € million; ∆% y-o-y Fx adjusted

Western Europe -1%

EmergingEconomies¹+10%

Others²+4%

² Others = Japan, Australia, New Zealand, Canada³ Emerging Asia = Asia without Japan, Australia, New Zealand

Emerging Asia³

Bayer is One of The Leading International HealthCare Companies in China


Driven by Pharmaceuticals (+26% Fx-adj)

~1,000 sales representatives added in 2011

Approx. 6,200 employees

€100m over 5 years to set-up a global R&D center in China

Beijing manufacturing site expansion (~€45m through 2015)

Partnership with Tsinghua University (joint drug discovery, student support)

HealthCare 2011 ~€1bn +19% y-o-y (Fx-adj.)*

Adalat

Avelox

Top products growth in 2011*Aspirin

+22%

+24%

+35%

+24%

Nexavar


+19%

Nexavar

* People‘s Republic of China

Glucobay

Avelox

Fiscal 2011 -Major Progress Achieved

• Bayer Investor Presentation • Meet Management • March 2012Page 8LCS: Levonorgestrel contraceptive system

*Adjusted EBITDAEM: Emerging markets

Emerging Markets HealthCare EM-sales growth of +10% PR China: Above market growth at Pharma (+26%) Expansion of marketing and sales organization

Pipeline

Performance Improved margins* at Pharma and Consumer Health (+140

bp each) Above market growth at Consumer Health

First Xarelto-launches in chronic indications Regulatory filings for Xarelto, VEGF-Trap-Eye, LCS Successful completion of major clinical studies (incl. programs

for Xarelto, Alpharadin, Regorafenib, VEGF Trap-Eye)


HealthCare -Positioned for Future Growth


Consumer Health

Pharma 4 potential blockbusters to be launched near-term

Limited patent expiration exposure

Strong presence in emerging markets

Strong brands

Leading positions in all businesses

Increasing share in mature and expand in Emerging Markets

Opportunities


Financial Outlook

Market Outlook 2012


For the OTC market we expect low-to-mid single-digit percentage growth

The Diabetes Care market is expected to grow by a low-single-digit percentage

Moderate growth expected in Animal Health market

The Pharma market is expected to grow in the mid-single-digit percentage range driven by Emerging Markets

Financial Outlook 2012


Expect sales to increase by a low- to mid-single-digit percentage (Fx & portf.–adj.) Plan to slightly improve adjusted EBITDA*

HealthCare

Pharmaceuticals

Consumer Health

Expect sales to remain stable or move slightly higher (Fx & portf.–adj.) Expect adjusted EBITDA* to approx. match prior-year level

Anticipate mid-single digit percentage growth of sales (Fx & portf.–adj.) Anticipate mid-single digit percentage growth of adjusted EBITDA*



Building Growth Momentum –

Pharmaceuticals

Pharma – Top 10 Products


YAZ-Family

Betaseron

Kogenate

Adalat

Glucobay

Avelox

Nexavar

Mirena

Levitra

1,075

1,117

1,070

640

332

486

725

581

404Aspirin C.

362

Rest of the worldU.S.

2011 sales in € million (y-o-y changes Fx-adj.)

-5%

+8%

-3%

+4%

-5%

+11%

-2%

+13%

+4%

-22%

785 (+11%)

670 (-9%) 447 (0%)

637 (-5%) 3 (•)

227 (+7%)

398 (+8%) 88 (-31%)

551 (+3%)

268 (+6%) 313 (+15%)

404 (+13%)

362 (+4%)

290 (+2%)

174 (+5%)

891 (+6%) 179 (-30%)

105 (-51%)

The Leader in Women’s HealthCare


Yaz family

Sales ∆% y-o-y, () Fx adj.

Women’s Healthcare 2011

€2,992m+2% (+3%)

+8 (+11)Mirena

+6 (+7)Diane

-4 (-3)

+67 (+69)Qlaira

Other products +4 (+5)

-2 (-1)Microgynon

-3 (-2)Valette

-6 (-6)Meliane

+13 (+14)Angeliq

Mirena - The Leading Hormonal Long-Acting Contraceptive


2009 2010

490539

254

218

272 285

Leading long-acting (up to five years) reversible contraception device

2011 growth driven by higher volumes in the US

Life-cycle opportunities: Small, low-dose long-acting (up to

three years) LCS filed in the US and EU in 2011

Further phase III program for a long-acting contraception LCS for up to five years underway

2012e sales: high-single/low-double digit % increase

2011

+11%

581

268

313

LCS: Levonorgestrel-releasing system


Sales in € million; ∆% Fx adj.

Hemophilia Franchise -Growth Trajectory Intact


2009 2010

8881,004

705638

250 299

Global # 2 in hemophilia A treatment

Increased market share in 2011

Development program underway

Longer acting factor VIII: Start of a pivotal study targeted for 2012

Recombinant FVIIa: Target to initiate a phase II/III study in 2012

Studies with plasma-free formulation on track

2012e sales: mid-single digit % increase

2011

+8%

1,075

785

290



Betaseron - Long-term Experience in MS Treatment


Rest of the worldU.S.2009 2010

1,214 1,206

733735

479 473

Wealth of clinical experience, demonstrating excellent efficacy and tolerability of Betaseron

21-year long-term follow-up study demonstrated significant survival advantage with Betaseron treatment

2012e sales: mid-to-high single-digit % decline

2011

-5%

1,117

670

447


Nexavar - Our Cornerstone in Oncology


Rest of the worldU.S.2009 2010

604705

531450

154 174

Approved for kidney cancer (RCC) and for liver cancer (HCC)

Only approved drug with overall survival benefit in HCC

Comprehensive development program underway, including phase III trials in Lung cancer (NSCLC) Thyroid cancer Breast cancer RCC (adjuvant) HCC (adjuvant) HCC (combination)

2012e sales: low-to-mid single-digit % increase

2011

+4%

725

551

174

RCC: Renal cell carcinoma, HCC: Hepatocellular carcinoma, NSCLC: Non-small cell lung cancer


Aspirin –More Than A Century of Growth


2009 2010

715

776

358315

400 418

2011

+10%

844

404

440

One of the world’s most recognized brands

Available as OTC and Rx Aspirin

Bayer’s #2 product in Emerging Markets; over-proportional growth

Aspirin grew 35% Fx-adj. in 2011 in China

2012e sales: mid-to-high single-digit % increase (Rx-Aspirin Cardio)

Rx-AspirinOTC-Aspirin


Xarelto -Key Features and Differentiators

Effectively reducing the risk of stroke and systemic embolism in AF-patients

Novel single-drug approach for DVT-treatment and sec. prevention

Superior efficacy with no increase in bleeding in VTE prevention after orthopedic surgery

Convenient once-daily, fixed oral dose; no need for routine coagulation monitoring

Proven efficacy in the broadest range of indications tested among novel anticoagulants

Only novel anticoagulant to complete successful study in ACS also showing mortality benefit

Unique phase III program for stroke prevention in AF-patients in Japan

• Bayer Investor Presentation • Meet Management • March 2012Page 21AF: atrial fibrillation, DVT: Deep vein thrombosis;

VTE: Venous thromboembolism; ACS: Acute coronary syndrome

Xarelto –Above €2bn Commercial Opportunity1


LMWHs: low molecular weight heparins, UFH: unfractionated heparins, VKA: vitamin K antagonists, DTI: direct thrombin inhibitors (incl. Pradaxa), Other antithrombotics (incl. Xarelto); MAT: Moving annual total

AF: atrial fibrillation, ACS: acute coronary syndrome, MI: myocardial infarction, VTE: venous thromboembolism

~$9.2bn 6.3369%

0.718%

0.637%

0.768%

0.738%

LMWH

VKA

UFH

DTI

Other

~2,100~100

~400

~200

~350

Strokepreventionin AF

VTE preventionafter orthopedicsurgery

Post ACS/MI

Otherprimaryprevention

VTEtreatment

~3,100m

Anticoagulants salesMAT 9/2011

Anticoagulants estimated treatment daysin 2010

1 Subject to approvalSource: IMS MIDAS, GERS, FARMINFORM for sales

Bayer estimates for patient treatment days in main markets

Xarelto – Targeting A Broad Range of Major Chronic Thromboembolic Diseases

• Bayer Investor Presentation • Meet Management • March 2012Page 23LMWH: Low molecular weight heparins; SOC: Standard of care; VKA: Vitamin

K antagonists; OAC: Oral anticoagulants; MI: Myocardial infarction

● Caused by embolism of a clot that migrates to the lungs where it becomes trapped

● Leading cause of in-hospital death

● Thrombi (clots) are formed in the deep veins of the leg

● Risk factors include surgery, particularly orthopedic, and age

● High risk of recurrent events, or developing a pulmonary embolism

DVT + PE = VTE(venous thromboembolism)

Pulmonary embolism (PE)

Deep venous thrombosis (DVT)

Venous

Stroke prevention in atrial fibrillation

Secondary prevention in ACS

Arterial

● Acute coronary syndromes (ACS) comprise unstable angina and MI

● The underlying cause is thrombosis● After initial treatment, patients remain

at high risk● Annual cases of ACS in US, EU major

5 and J estimated to be ~ 2 million● SOC: antiplatelets

● Atrial fibrillation (AF) can cause the development of clots, via stasis in the atria, which can travel to the brain

● AF increases stroke risk ~5-fold● ~ 3.5 million AF-patients in the US,

> 6 million in EU and > 800,000 in J ● SOC: OAC

● Estimated ~ 900,000 cases/year in major EU countries

● SOC: LMWH followed by VKA; Xarelto approved in Europe

Xarelto –Rolled-out for Success


Launched in >110 countries for VTE prevention following total knee/hip replacement surgery

Launched in Europe and Canada in SPAF and DVT treatment

Launched in SPAF in US

Approved for SPAF in Japan

Filed in ACS in Europe and US (priority review)

SPAF: prevention of stroke and systemic embolism in patients with non-valvularatrial fibrillation, DVT: deep vein thrombosis

Xarelto in SPAF –Global Launch Underway

• Bayer Investor Presentation • Meet Management • March 2012Page 25SPAF: prevention of stroke and systemic embolism in patients with non-valvular

atrial fibrillation, Rx: prescription; OAC: Oral anticoagulant; SMC: ScottishMedicines Consortium; NICE: National Institute for Health and Clinical excellence

Status as of March 2012

J&J: generating positive launch momentum and steady growth; growing faster than competition in new Rx’s among novel OACs overall; favorable formulary access across majority of plans

First weeks of sales in SPAF in-line with expectations

Strong market uptake

Positive recommendation by SMC for SPAF, discussion with NICE ongoing

Pricing and reimbursement discussions underway

Approved, launch planned for Q2

Xarelto –Strong Market Performance in Germany*

• Bayer Investor Presentation • Meet Management • March 2012Page 26Source: IMS Health, Weekly Retail Sell-Out Data; BAYER

Sales market share estimates based on AC market

Sales Market Share in %(based on ex-manufacturer prices)

0

200

400

600

800

1.000

1.200

1.400

1.600

1.800

calendar week 7 after launch

Cum

ulat

edD

aily

The

rpai

es(0

00)

Cumulated daily therapies (DDD) - all dosage strengths and pack sizes at

week 7 after launch

Xarelto

Pradaxa

* As of March 2012

7,2

6,26,8

6,05,7

6,8

1,4

1/2/12 2/27/122/13/121/30/121/16/12

10,0

7,5

5,0

2,5

5,5

1,8

Xarelto

Secondary Prevention of ACS –Key Findings from the ATLAS Phase III Study

• Bayer Investor Presentation • Meet Management • March 2012Page 27ACS: Acute coronary syndrome,

BID: twice daily

16 percent relative risk reduction for cardiovascular (CV) death, stroke or myocardial infarction in patients taking rivaroxaban

> 30 percent reduction of risk of CV death or all cause death if rivaroxaban(2.5 mg BID) is added to standard anti-platelet therapy

> 30 percent reduction in stent thrombosis in patients taking rivaroxaban

More TIMI major bleeding in the rivaroxaban groups (up to 2.4% in the 5mg BID group) compared to placebo (0.6%)

No excess risk of fatal intracranial hemorrhage or fatal bleeding associated with rivaroxaban compared to placebo

EINSTEIN PE – Study Design


Objectively confirmed PE ±

DVTR

N=4,833

LMWH: Low molecular weight heparin; VKA: Vitamin K antagonist; DVT: Deep vein thrombosis; R: Randomization: PE: Pulmonary embolism;

INR: International normalized ratio

15 mg bid

RivaroxabanDay 1 Day 21

Enoxaparin 1.0 mg/kg bid for ≥5 days, followed by

VKA, INR range 2–3

Treatment period: 3, 6 or 12 months*

20 mg od

30-d

ay o

bser

vatio

n

pe

riod

Rivaroxaban

*Decision to treat for 3, 6 or 12 months made by investigator at time of randomization; up to 48 hours pre-treatment with heparins/fondaparinux permitted before study entry

● Randomized, open-label, event-driven, non-inferiority study

The EINSTEIN PE study addresses the treatment of pulmonary embolism (PE) and the secondary prevention of venous thromboembolism (VTE) using

oral rivaroxaban alone vs. standard therapy (LMWH followed by VKA)

Xarelto –Major Expected Upcoming Newsflow


EINSTEIN PE Phase III data presentation at ACC, March 26, 2012

Secondary prevention of ACS – approval expected summer 2012

(US) and end 2012 (EU)


Building Growth Momentum –

Consumer Health

Consumer Health Businesses –A Highly Attractive Part of Our Portfolio


Predictable cash flow

Attractive growth potential

Consistent, attractive returns at modest risk

Evolution from “passive patient” to “pro-active consumer”

Consumer expertise becoming a required competency for success

Aging population and increasing life expectancy

Emerging markets: OTC growth due to accessibility and lower cost

Attractiveunderlying trends

Sustainablebrands

Consumer centered

Financiallyattractive

Less patent dependent

Less R&D and capital intensive

Strong consumer brands have attractive long lifetimes

Consumer Care –Gained Share in 2011


+7%

Global #2 in a growing market

Track record of performance

Some of the world’s most recognized brands

Acquired Roche OTC, Citracal, Sagmeland Topsun

Performance

Sales in € million; ∆% Fx & portfolio adj.

2,531 2,634

3,020 3,0803,371

3,534

2006 2007 2008 2009 2010 2011

Consumer Care –Strong Brands Matter


Brand 2011 Sales y-o-y Growth

440*

285

235

224

174

140

+9%

+9%

+11%

+7%

+2%

+4%

* Only Aspirin CC sales, excluding Rx Aspirin Cardio


Radiology & Interventional – Combining Medrad and Diagnostic Imaging


Medrad: Clear #1 Active in fluid injection systems for

contrast media and endovascular devices Business strengthened around strategic

core through adjacent acquisitions of Possis (thrombectomy) and Pathway (mechanical atherectomy)

Diagnostic Imaging: Clear market leader in contrast media

Synergy creation through integration underway

Highlights

1,371*1,298 1,323 1,363

1,474 1,498

2006 2007 2008 2009 2010 2011

+2%


* pro forma sales

Diabetes Care –Global Player in Blood Glucose Meters


+2%

810

934 9561,000 993 1,002

2006 2007 2008 2009 2010 2011

Global #4 in blood glucose meters

Latest innovation products include CONTOUR™ USB meter with Plug & play technology for instant access to

patterns and trends

Patients can share data with their healthcare professional

Performance


Animal Health – A Top Player in an Attractive Market



+5%

Global #4 in a growing market

Ranked #3 in companion animal products (CAP)

#5 in food animal products (FAP)

Outpaced the market – in the majority of last years

Industry leading profitability

Successful integration of Bomac

905956 963 977

1,1201,186

2006 2007 2008 2009 2010 2011

Performance

New Animal Health Products


Veraflox

Procox

“1st combined endoparasiticide against roundworm and coccidiain dogs”

“Pradofloxacin, the new generation fluoroquinolone with unique microbiology”

Dual targeting action with extended spectrum vs previous fluoroquinolones(greater Gram+ activity, anaerobes)

Greater potential to limit the selection for resistance

Convenient formulations for both dogs and cats

Easy and convenient single oral dose treatment

Can be used already from 2 weeks of age

Completes the endoparasiticides portfolio based on the active ingredient emodepside


Pharma Pipeline –

VEGF Trap-Eye

VEGF Trap-Eye – Bayer’s Entry into Ophthalmology


FoveaFovea

MaculaMacula

Normal retina Abnormal vessel growth

VEGF: Vascular endothelial growth factor; AMD: age-related macular degeneration, CRVO: central retinal vein occlusion, DME: diabetic macular edema,

CNV: choroidal neovascularization

VEGF Trap-Eye: fully human fusion protein, specifically formulated for injection into the eye

“traps” VEGF which induces abnormal vessel growth

Collaboration with Regeneron; Bayer has marketing rights ex-US

Filed for wet AMD in Europe and Japan

Filing for CRVO targeted for 2H 2012

Phase III in DME and mCNVongoing

Retina Treatment is The Fastest Growing Area Within Ophthalmology


10

1

4

10

6

Glaucoma

Dry eyeOther

2018

23.8

6.1

5.9

6.2

4.3

1.3

20081

5.0

4.1

2.4

1.7

Anti-allergry/infec-tive/ inflammatory

Source: IMS Health1 2009 value is $14.7bn

Global Ophthalmology Market in $bn CAGR 2008-2018 in %

Retinal disorders

13.9

6.1

5.9

6.2

4.3

1.3

5.0

4.1

2.41.7

0.7

High Prevalence of Retinal Diseases


Wet AMD is the leading cause of acquired blindness in the elderly approx. 1.2 million patients in the US

DME is the most prevalent cause of vision loss in patients with diabetes and a leading cause of acquired blindness in the adults aged < 50 years Approx. 370,000 patients suffer from clin. significant DME in the US, with 95,000

new cases / year

CRVO may lead to vision loss and other serious complications > 100,000 people in the US and > 66,000 people in key EU countries are

estimated to suffer from CRVO

Severe myopia is common in Asia; in Japan, mCNV is the second most common cause of blindness Prevalence in Japan is estimated to be approx. 200,000

AMD: Age-related macular degeneration; DME: Diabetic macular edema; CRVO: Central Retinal Vein Occlusion;

mCNV: Myopic choroidal neovascularization;

Ex-US Territories Represent a Significant Opportunity for VEGF Trap-Eye in wet AMD

• Bayer Investor Presentation • Meet Management • March 2012Page 42Source: Annual incidence: NICE; Worldwide incidence: AMD Alliance International.

Increasing Understanding of Wet Age-Related Macular Degeneration (AMD) as a Chronic Disease. April 2011

34

49

39

25

32

120

20

37

167USA

Brazil

Canada

Japan

UK

Spain

Italy

Germany

France 300

422

332

214

276

348

148

332

1,229

Total prevalence (2012e)wAMD patients (thousands)

Annual incidence (2012e)Annual newly diagnosed wAMD patients (thousands)

USA

Brazil

Canada

Japan

UK

Spain

Italy

Germany

France

VEGF Trap-Eye -Multiple Retinal Disease States


MYRROR study:Completion1 2012/2013e

US: launched 2011*

EU: launch planned for end 2012#

VIVID study:Completion1 2013/14e

VISTA* study:Completion1 2013/14e

US: filed*

Filing EU: 2H 2012e

wAMD

Positive PIII(US)

Positive PIII (Europe, J, etc)

China PIIIStudy started

Positive PIII(ROW)

Positive PIII (US)

CRVO

DME

Positive PII Completed

PIII ongoing (Europe, J, others)

PIII ongoing (US, others)

PIII Japan/Asia Pacific Ongoing

mCNV

* Regeneron# subject to regulatory approval

1: completion refers to primary completion estimated

Phase III Studies in wet AMD – Every Other Month Dosing Possible with VEGF Trap-Eye


Out of 8 possibleinjections (5 in last 10 months)

Ranibizumab VEGF Trap-EyeTreatment arm in VIEW

# of injections

14

12

10

8

6

4

2

0

Out of 13 possible injections

Full analysis set:Rq4 n=5952q4 n=613

0.5q4 n=5972q8 n=607

12.3 12.3 12.2

7.5

2q4 0.5q4 2q8

VIEW 1,2 Phase III study results demonstrate comparable efficacy vs. Ranibizumabwith every other month injection through first year

2q4: VEGF Trap-Eye 2mg once every month; Rq4: Ranibizumab 0.5mg once every month; 2q8: VEGF Trap-Eye 2mg every other month;

0.5q4: VEGF Trap-Eye 0.5mg once every month

02468

101214

0 4 8 12 16 20 24 28 32 36 40 44 48 52

ETDR

S Le

tters

Week

Rq4 2q4 0.5q4 2q8

VIEW 1 & 2 – Vision Maintained With VEGF Trap-Eye Dosed Every Other Month

• Bayer Investor Presentation • Meet Management • March 2012Page 452q4: VEGF Trap-Eye 2mg once every month; Rq4: Ranibizumab 0.5mg once every month; 2q8: VEGF Trap-Eye 2mg every other month;0.5q4: VEGF Trap-Eye 0.5mg

once every month; *P = 0.0054; †P = NS vs. Rq4

02468

101214

0 4 8 12 16 20 24 28 32 36 40 44 48 52

ETDR

S Le

tters

VIEW 29.4Rq4 (n=291)

7.6† 2q4 (n=309)

9.7†0.5q4 (n=296)

8.9† 2q8 (n=306)

8.1 Rq4 (n=304)10.9* 2q4 (n=304)

6.9†0.5q4 (n=301)7.9†2q8 (n=301)

VIEW 1

VEGF Trap-Eye –Positive Clinical Data in CRVO


Marked improvement in vision in CRVO-patients treated with VEGF Trap-Eye

● Phase III program with two studies (COPERNICUS, GALILEO) in central retinal vein occlusion (CRVO)

● VEGF Trap-Eye vs. sham control injection

● Both studies met primary endpoint: Visual acuity change vs. baseline after 6 months of treatment

● Positive one-year results confirm primary endpoint results seen after 24 weeks

Sham injections

VEGF Trap-Eye2 mg monthly

22.1%

60.2%

GALILEO: p<0.0001 COPERNICUS: p<0.0001

56.1%

12.3%

Percentage of patients with improvement of vision of at least 15 letters after 6 months

CRVO: Central Retinal Vein Occlusion

VEGF Trap-Eye –Major Expected Upcoming Newsflow


Wet AMD – Launch in Europe planned for end 2012

CRVO – Filing targeted for 2H 2012 in Europe


Pharma Pipeline –

Regorafenib

Regorafenib – Three Dimensional Mode of Action


Regorafenib is an oral tumor deactivation agent that potently blocks multiple protein kinases, including kinases involved in:

Tumor angiogenesis (VEGFR1, -2, -3, TIE2)

Oncogenesis (KIT, RET, RAF-1, BRAF, BRAFV600E)

Tumor microenvironment (PDGFR, FGFR)

Inhibition of neoangiogenesis

Inhibition of tumormicroenvironment signals

Inhibition of proliferation of certain tumor cells

VEGFR: Vascular endothelial growth factor receptor; TIE2: Tyrosine kinase with immunoglobulin-like and EGF-like domains ; PDGFR: Platelet derived growth factor

receptor; FGFR: Fibroblast growth factor receptor;

Regorafenib – Our Novel Multi-Kinase Inhibitor


CORRECT phase III trial in mCRC* stopped early on success (Oct ‘11)

Study met its primary endpoint of significantly improving overall survival in patients with mCRC who have progressed after failure of standard therapy

Submission for marketing authorization in mCRC planned for 1H 2012

Phase III program in GIST ongoing, data expected 1H 2012

FDA granted orphan drug (GIST) and Fast Track (GIST & mCRC) designation

Phase II program ongoing in multiple tumor types

mCRC: Metastatic colorectal cancer; * for patients whose disease has progressed after approved standard therapies; GIST: Gastrointestinal stromal tumors;

Regorafenib – Phase III Results in mCRC Show Promise


The study met its primary endpoint of significantly improving overall survival by 29 % (p=0.0052, HR=0.77) at the preplanned interim analysis

The trial also met key secondary efficacy endpoints including significant improvement of

Progression-free survival (HR=0.49, p<0.000001), and

Disease control rate (p<0.000001)

No new or unexpected safety findings:

Main treatment-related adverse events observed in the regorafenib arm were fatigue, hand–foot skin reaction, diarrhea, anorexia, voice changes, hypertension, oral mucositis, and rash/desquamation

mCRC: Metastatic colorectal cancer

Colorectal Cancer – Common Cancer Type With High Unmet Medical Need


■ Unmeet need:

■ A common cancer:● Incidence of 1.2million cases globally, third leading cause of cancer-related death

● There are currently no approved treatments for mCRC after progression on standard therapies

● The current 5-year relative survival rate is on average 65%● Oral therapy provides convenience to patients

Source: Decision Resources Jan 2011 CRC Report

mCRC: Metastatic colorectal cancer

Gastro-intestinal Stromal Cancer (GIST)


GIST is a rare sarcoma affecting the digestive tract and occurs in the stomach or small intestine

The incidence of GIST in the U.S. is estimated to be 4,100 -6,000 / year

Overall 5-year survival rates for primary resected disease are in the order of 50%–55%1

Imatinib and sunitinib are established standards

1 Din, Omar S, Woll, Panella J, Treatment of gastrointestinal stromal tumor: focus on imatinib mesylate. Academic Department of Clinical Oncology, University of Sheffield,Weston Park Hospital, Sheffield, UK ; *DeMatteo RP, Heinrich MC, El Rifai WM, et al. Clinical management of gastrointestinal stromal tumors: before and after STI-571. HumPathol. 2002;33:466–477. ; W.-L. Wang et al Cancer Chemother Pharmacol (2011) 67 (Suppl 1):S15–S24; Photo: www.gistalliance.com

No standard of care beyond imatinib and sunitinib A clear need for additional lines of treatmentUnmet need

GISTs in the GI Tract

Regorafenib Phase III in GIST (GRID) -Study Design


AdvancedGISTafter failure ofat least imatiniband sunitinib

Regorafenib 160 mg od 3 wks on /1 wk off

Placebo

Primaryendpoint:PFS

2:1randomisation

● Primary endpoint: progression-free survival (PFS) per blinded central radiology review; (significance level/power: 0.01 (one-sided) / 90%)

● Secondary endpoints (selection): overall survival; time to progression tumor response rate; duration of response

● Time frame (months): approx. 12● Total number of PFS events (plan): 144● Total number of patients enrolled: 199

GIST: Gastrointestinal stromal tumor

Regorafenib –Clinical Program*


Safety study of BAY73-4506 in patients with hepatocellular carcinoma

N=36

MilestonesPhase IIIPhase II

3rd/4thline metastatic colorectal cancer (CRC) Filing target1H2012

Facts Metastatic colorectal cancer after

failure of standard therapy; regorafenib + best supportive care (BSC) vs. placebo + BSC; N=760

Study

CORRECTNCT01103323

GRIDNCT01271712

Phase I

Gastrointestinal stromal tumors (GIST) ≥ 3rd line

Metastatic/unresectablegastrointestinal stromal tumors (GIST) ≥ 3rd line

N=199

NCT01298570** Metastatic CRC

Regorafenib + FOLFIRI versus placebo+FOLFIRI as 2nd line Tx in K-RAS/BRAF mutant metastatic CRC; N=240

Data 1H 2012e

NCT01289821 Metastatic CRC

Regorafenib + mFOLFOX6 as first line therapy in patients with metastatic CRC

N=54

Hepatocellular carcinomaNCT01003015 Data reported

NCT01068769** Regorafenib in patients with

metastatic and/or unresectableGIST; N=34

Metastatic / unresect. GIST

NCT00664326 Regorafenib in previously untreated

patients with metastatic or unresectable RCC; N=49

Renal cell carcinoma Data reported

*selection of studies** investigator-sponsored study

Regorafenib –Major Expected Upcoming Newsflow


Metastatic Colorectal Cancer – Filing targeted for 1H 2012

Phase III 3rd-line GIST (GRID) – data expected 1H 2012


Pharma Pipeline –

Alpharadin

Alpharadin – New Potential Therapy to Prolong Life in CRPC Patients


Alpha-pharmaceutical (Radium-223, delivering highly energetic, short ranging radiation) - in-licensed from Algeta

Radium as natural bone seeker targeting bone metastases ALSYMPCA (phase III) trial in symptomatic castration-resistant prostate cancer

(CRPC) patients with bone metastases stopped early - Alpharadin demonstrated 44% improvement in overall survival

Filing targeted mid 2012 Fast track status granted by FDA

Tumor cellsNewly formedbone

Radium-223 deposition Radium-223: highly localized tumor cell killingBone metastases

Significant Unmet Need for Treatments for CRPC Patients with Bone Metastases

• Bayer Investor Presentation • Meet Management • March 2012Page 59CRPC: Castration-resistant prostate cancer

Prostate cancer: Sixth leading cause of death from cancer in men; most commonly diagnosed cancer among men in the US and Europe

In 2008, 899,000 men were diagnosed and 258,000 died from prostate cancer worldwide1

CRPC is a form of advanced prostate cancer in which the tumor grows despite castrate levels of testosterone

Majority of CRPC patients have radiological evidence of bone metastases

Bone metastases are the main cause of disability and death in patients with CRPC

Bone metastasis in prostate cancer

1 World Health Organization. GLOBOCAN 2008.; 2Mundy GR. Nat Rev Cancer. 2002;2(8):584-93 3Bubendorf L, et al. Hum Pathol. 2000;31(5):578-83

Alpharadin – Prolonged Life in CRPC* Patients in the ALSYMPCA Phase III Study

• Bayer Investor Presentation • Meet Management • March 2012Page 60 CRPC: Castration-resistant prostate cancer

In CRPC patients with bonemetastases Radium-223:

Significantly prolonged OS P value = 0.00185;

HR = 0.695; 95% CI, 0.552-0.875

Significantly prolonged time to first SRE P value = 0.00046;

HR = 0.610; 95% CI, 0.461-0.807

Was very well tolerated

* The ALSYMPCA trial was a Phase III, randomized (2:1), double-blind, placebo-controlled international study of Alpharadin plus best standard of care compared with placebo plus best standard of care in patients with symptomatic CRPC that has spread to the bone.

** Parker C, Heinrich D, O’Sullivan JM et al. Overall survival benefit of Alpharadin in the treatment of patients with symptomatic bone metastases in castration-resistant prostate cancer (CRPC): a Phase III randomized trial (ALSYMPCA). Presented at the 2011 European Multidisciplinary Cancer Congress. September 24, 2011

ALSYMPCA* Overall Survival**

Alpharadin – Strong Improvement of Skeletal-related Events in ALSYMPCA


In addition to OS benefit, Alpharadin improved important skeletal-related event (SRE) components being associated with a 64% improvement in median time to first SRE of 13.5 months vs. 8.4 months for placebo (HR=0.610, p=0.00046) SREs are associated with a poor prognosis in CRPC patients with bone

metastases, leading to pain, a decrease in quality of life and hospitalization Spinal cord compression can be devastating for patients as it can cause

paralysis, as well as bladder and bowel dysfunction

CRPC: Castration-resistant prostate cancerOS: Overall survival

SRE Components: Number of Patients and Time to First EventNo (%) of Patients Time to First Event (Alpharadin vs. Placebo)

Alpharadin(n=541)

Placebo(n=268)

P-value* HR (95%CI)

External beam radiotherapy

122 (23) 72 (27) 0.0038 0.65(0.48-0.87)

Spinal cord compression

17 (3) 16 (6) 0.016 0.44 (0.22-0.88)

Pathologic bone fracture

20 (4) 18 (7) 0.013 0.45(0.24-0.86)

Surgical intervention 9 (2) 5 (2) 0.69 0.80(0.27-2.4)

Alpharadin –Major Expected Upcoming Newsflow


Filing for treatment of bone metastases in castration-resistant prostate cancer (CRPC) targeted for mid 2012

Initiation of additional clinical studies targeted for 2H 2012


Pharma Pipeline –

Riociguat

Pulmonary Hypertension (PH) –A Devastating Disease


Mean pulmonary arterial pressure > 25 mm Hg at rest or > 30 mmHg with exercise (mean normal pressure ~15 mm Hg)

Breathlessness, fatigue, weakness, angina, syncope, abdominal distension

Symptoms at rest in advanced stages

PH is continuous high blood pressure in the pulmonary artery, a critical blood vessel which channels blood from the heart to the lungs for re-oxygenation

Patients ~ 700,000 patients diagnosed* with diseases related to /

including PH, thereof ~ 300,000 might be eligible for PH treatment

* Diagnoses estimated in 2009 in US, EU5, J

Definition of PH

Criteria

Clin. Symptoms

Patients

Riociguat – A New Mode of Action


Oral stimulator of soluble guanylatecyclase (sGC)

Acts independently of nitric oxide (NO)

Enhances the sensitivity of sGC to low levels of bioavailable NO

Increased cGMP levels lead to vasodilatation

Maintains the crucial balance between oxygen supply and blood flow, avoiding a drop of oxygen in the blood

Reduction of pulmonary vascular resistance and alleviation of disease symptoms

ConstrictedPressureFlow rate

RelaxedPressureFlow rate

sGC*Riociguat cGMP

NO

*native (intact)cGMP: cyclic Guanylate Monophosphate

Riociguat – Clinical Program


Next steps and options in other forms of Pulmonary Hypertension being evaluated

PH-LHD: PH owing to left heart disease

MilestonesPhase IIIPhase II

Pulmonary Arterial Hypertension (PAH)Fully recruited

Completion 2H 2012e

Fully recruited

Completion 2H 2012e

Facts

~ 460 patients (treatment-naïve or pre-treated) vs.placebo (PATENT-1); Efficacy study and long-term extension

~ 270 patients vs.placebo(CHEST-1); Efficacy study and long-term extension

Phase I

Chronic Thromboembolic Hypertension (CTEPH)

Study

Completion mid 2012e

~ 180 patients vs.placebowith left ventricular systolic dysfunction

PH-LHD

Riociguat – PATENT-1/2: Phase III Efficacy and Long-term Extension Trial in PAH


PAH: Pulmonary arterial hypertension

Primary outcome measure: change from baseline in 6 Minute Walking Distance (6 MWD) test after 12 weeks*

Secondary outcome measures: Change from baseline in Pulmonary Vascular Resistance (PVR), change from baseline in

WHO functional class, change from baseline in NT-pro BNP, change from baseline in Borg dyspnea, change from baseline in EQ-5D and LPH, time to clinical worsening

Safety**

*Secondary outcome in extension, ** primary outcome in extension; p.o.: per os - oral; TID: three times daily; NT-pro BNP: N-terminal pro brain natriuretic peptide; EQ-5D:

quality-of-life measures; LPH: Living with Pulmonary Hypertension Questionnaire

Riociguat – CHEST-1/2: Phase III Efficacy and Long-term Extension Trial in CTEPH


CTEPH: Chronic thromboembolic pulmonary hypertension

Primary outcome measure: change from baseline in 6 Minute Walking Distance (6 MWD) test after 16 weeks*

Secondary outcome measures: Change from baseline in Pulmonary Vascular Resistance (PVR), change from baseline in

WHO functional class, change from baseline in NT-pro BNP, change from baseline in Borg dyspnea, change from baseline in EQ-5D and LPH-Q, time to clinical worsening

Safety**

*Secondary outcome in extension, ** primary outcome in extension; p.o.: per os - oral; TID: three times daily; NT-pro BNP: N-terminal pro brain natriuretic peptide; EQ-5D:

quality-of-life measures; LPH: Living with Pulmonary Hypertension Questionnaire

Riociguat –Major Expected Upcoming Newsflow


Completion Phase III in PAH (PATENT-1) expected 2H 2012

Completion Phase III in CTEPH (CHEST-1) expected 2H 2012

PAH: Pulmonal arterial hypertensionCTEPH: Chronic Thromboembolic pulmonary hypertension

PH-LHD: PH owing to left heart disease

Completion Phase II in PH-LHD (LEPHT) expected 2H 2012


Pharma Pipeline –

Other Pipeline

Development Pipeline

• Bayer Investor Presentation • Meet Management • March 2012Page 71 Selection of major Pharma Pipeline Projects in clinicial Phase I to III

Phase I (14) Phase II (8) Phase III (21)Cancer BAY 80-6946(PI3K Inhibitor)

Heart FailureBAY 1067197(Part. Aden. A1 Agonist)

CHFBAY 94-8862(MR Antagonist)

Additional IndicationsNexavar

PAHRiociguat (sGC Stimulator)

VTE TreatmentXarelto

CancerBAY 1000394(CDK-Inhibitor)

Heart FailureBAY 86-8050(Vasopr. Rec. Antag.)

CancerBAY 86-9766(MEK-Inhibitor)

Lung InfectionCipro inhale

CTEPHRiociguat (sGC Stimulator)

NSCLCNexavar

CancerBAY 87-2243(HIF1 – Inhibitor)

Heart FailureBAY 1021189(sGC Stimulator)

Gram-negative PneumoniaAmikacin inhale

Submental fat removalATX-101

Thyroid CancerNexavar

CancerBAY 94-9343(Mesothelin-ADC)

EndometriosisBAY 1026153

Pulmonary HypertensionRiociguat (sGC Stimulator)

Bone Mets CRPCAlpharadin

Breast CancerNexavar

AnemiaBAY 85-3934(HIF-PH)

MCIBAY 94-9172(Florbetaben)

CancerAlpharadin

Skin and Lung InfectionsTedizolid

Adjuvant HCCNexavar

Sympt. Uterine FibroidsBAY 1002670 (S-PRAnt)

CancerRegorafenib

mCRCRegorafenib

Adjuvant RCCNexavar

Diagnostic ImagingPET-Tracer

GISTRegorafenib

Contraception FC Patch Low

HemophiliaBAY 94-9027(peg rFVIII)

Alzheimer PET ImagingBAY 94-9172(Florbetaben)

MRI LCM Gadovist

HemophiliaBAY 86-6150(rFVIIa)

Myopic CNVVEGF Trap-Eye

VV Atrophy Vaginorm

DMEVEGF Trap-Eye

ContraceptionLCS 16

CRVOVEGF Trap-Eye

New molecular entities(NME)

Life cycle management(LCM)

Status as of February 2012

Heart Health and Hematology at BHC –Driving Our Expertise


Anemia / HIF-PH

Hemophilia / peg. rFVIII (BAY 94-9027)

Hemophilia / rFVIIa (BAY 86-6150)

CHF / MR Antagonist (BAY 94-8862)

PH / Riociguat (sGC Stimulator)

VTE Treatment / Rivaroxaban

PAH / Riociguat (sGC Stimulator)

CTEPH / Riociguat (sGC Stimulator)

Phase IIIPhase IIPhase I

Riociguat – Phase III/Phase II A soluble guanylate cyclase (sGC) stimulator; in development for

the treatment of various forms of pulmonary hypertension Hematology: Start of pivotal study with longer-acting pegylated rFVIII planned for

2012 Start of combined phase II/III with rFVIIa planned for 2012

Additional novel approaches – Phase I/preclinical Focus on disease modification in additional cardiovascular diseases

Heart Failure / part. Adenosine A1 Agonist

Heart Failure / Vasopress. Rec. Antagonist

Heart Failure / sGC Stimulator

Oncology – Building A Sustainable Franchise In Fighting Cancer


Sorafenib (Nexavar) Several Phase III studies ongoing

MEK-Inhibitor Small molecule mitogen-activated ERK kinase (MEK) inhibitors for the

treatment of solid tumors Under evaluation in advanced cancer patients of different tumor types

as a single agent as well as in combination, for instance with Nexavar(Phase I/II) or in combination with PI3K-I (Phase I/II)

Solid portfolio of promising early-stage projects

Phase IIIPhase IIPhase ICancer / PI3K Inhibitor

Cancer / CDK Inhibitor

Cancer / HIF1 Inhibitor

Cancer / Mesothelin-ADC

Cancer / Regorafenib

Cancer / MEK-Inhibitor

Cancer / Alpharadin

Additional Indications / Sorafenib

NSCLC / Sorafenib

Thyroid Cancer / Sorafenib

Breast Cancer / Sorafenib

Adjuvant RCC and HCC / Sorafenib

CRC / Regorafenib

GIST / Regorafenib

Bone Mets CRPC / Alpharadin

CDK: Cyclin dependent kinase; CRC: Colorectal cancer; HCC: Hepatocellular carcinoma; CRPC: Castration-resistant prostate cancer; NSCLC: Non-small cell lung cancer ; PI3K:Phospharidylinositol-3 kinase; MEK:Inhibitor of MEK proteinkinase ; GIST: Gastrointestinal stromal tumor; RCC: Renal cell carcinoma

Women’s Health – Building On Our Leading Position


Further expanding the world-leading position in Women‘s Healthcare

LCS: New low dose levonorgestrel releasing intrauterine system (IUS); program for up to 5 years of contraception in phase III

FC Patch Low: Once a week fertility control patch. Smallest, thinnest and only transparent patch for women who prefer non-daily contraception

Vaginorm: Treatment of vulvo-vaginal atrophy, intra-vaginal application of dehydroepiandrosterone (DHEA)

Phase IIIPhase ISympt. Uterine Fibroids / S-PRAnt Contraception / LCS-16

Contraception / FC Patch Low

VV Atrophy / VaginormEndometriosis / BAY 1026153

LCS: Levonorgestrel contraceptive system

Dermatology – Progressing in Aesthetic Medicine


Long-standing position in Rx-Dermatology

ATX-101 (First-in-class injectable adipolytic agent) In-licensed from Kythera Currently in development for the treatment of submental

fat (double chin) Phase III completion expected mid 2012

Phase IIISubmental fat removal / ATX-101

Expected Major Pipeline Newsflow 2012


Pipeline Project Newsflow Timeframe

Xarelto Data from Einstein PE Data at ACC, March 26, 2012 Chicago

Approval for ACS Secondary prevention of ACS – approval expected summer 2012 (US); end 2012 (EU)

VEGF Trap-Eye Launch EU (wet AMD) End 2012e

Filing CRVO 2H 2012e

Alpharadin Filing CRPC Mid 2012

Regorafenib Filing mCRC 1H 2012e

Data from phase III GIST trial (GRID) 1H 2012e

Riociguat Phase III PAH and CETPH Completion 2H 2012e

Nexavar Phase III non-small cell lung cancer(NSCLC) (MISSION)

Completion mid 2012e

Phase III thyroid cancer (DECISION) Completion mid 2012e

Phase III hepatocellular carcinoma (HCC) ±Tarceva (SEARCH)

Completion 1H 2012e

Phase III HCC adjuvant (STORM) Completion end 2012e / early 2013

Peg rFVIII (BAY 94-9027) Start pivotal study 2012e

rFVIIa (BAY 86-6150) Start combined phase II/III 2012e

Note: completion refers to primary completion estimated

Investor Handout – Meet ManagementBayer CropScience

March 2012 – Leverkusen

Fiscal 2011 –A Year of Significant Progress

Page 2

Innovation Refocused R&D investments

Strong track-record of innovations in 2011-2012

Strategy

Performance & Productivity

2011: 9% organic growth and +28% adjusted EBITDA*

€265m savings on target by 2012

Outlook Market conditions expected to remain favorable in 2012

Positive outlook for our business


Developed and communicated new business strategy

Executing aggressively; accelerated licensing; selective M&A


Executing Our Strategic Roadmap


Reinvent customer-centricity along the entire value chain

Rebalance andrefocus innovation

Rejuvenate the core Crop Protection business

Raise overall R&D spend to more than €850 million by 2015

Increase BioScienceR&D to be level with AgChem spend

Intensify interdisciplinary work at chemistry / biology interface

Better understand andserve interconnectedneeds of customers, from seed to shelf

Foster food chainpartnerships

Streamline portfolio and focus on core crops, brands and countries

Optimize our supply chain model and asset footprint

Deliver savings of €265 million through 2012

Extend BioSciencefootprint

Strengthen our position in established crops

Develop leading positions in 3 of 4 broad acre crops

Fiscal 2011 –Key Financials CropScience

• Bayer Investor Presentation • Meet Management • March 2012Page 4* before special items

Sales 6,830 7,255 +6.2

EBIT 261 562 +115.3

EBIT adjusted* 787 1,168 +48.4

EBITDA adjusted* 1,293 1,654 +27.9

Gross cash flow 546 900 +64.8

Net cash flow 1,399 691 -50.6

CapEx 366 315 -13.9

Free operating cash flow 1,097 411 -62.5

R&D expenses 722 723 +0.1

Capital invested (average) 9,189 8,772 -4.5

CFRoI 5.9% 10.3% ●


Fiscal 2011 – Sales Increase and Strong Earnings Growth

Crop Protection /BioScience+7% (+10%)


-4% (-2%)36%

CropScience €7,255m; +6% (+9%)

6,629626

Price-1%

Volume+10%

Fx-2%

Portfolio0%

1,293

1,654 +28%

2010 2011 2010 2011

787

1,168

AdjustedEBITDA*

AdjustedEBIT*

+48%


Sales EarningsSales in € million; ∆% y-o-y, () Fx & portfolio adj.



35%

17%25%

23%

Asia/Pacific

Sales: €1,244 (+3% Fx adj.) Main Drivers: Fungicides moved ahead strongly; insecticides impacted by portfolio streamlining; seed treatment expansion; Japan flat

Europe

Sales: €2,505 (+6% Fx adj.)Main Drivers: Strong growth in Eastern Europe; seed treatment and herbicide gains; successful launch of Xpro fungicide

North America

Sales: €1,703m (+14% Fx adj.)Main Drivers: Fungicides gained from launch of Stratego YLD; new corn herbicides; seed treatment benefited from Poncho/Votivo; BioScience expansion

LatAm/Africa/Middle East

Sales: €1,803m (+11% Fx adj.)Main Drivers: Insecticides rose from Belt and new products; growth for cotton and corn herbicides; new Fox fungicide; BioScience gains

Fiscal 2011 – Growth in all Regions, Mainly Driven by New Products

Herbicides

Fungicides

Seed Treatment

BioScience

Innovations Driving Growth in 2011


Strong growth in Europe and in the Americas; new corn herbicides

Market share gains in the US;New Xpro above €100m sales

Impacted by cessation of marketing of WHO Class I products (about -€100m)

Double-digit growth in all regions; Launch of Poncho/Votivo in the US

Lower Specialty Actives sales partly offset by increased US business

Double-digit growth in all established crops


2,079+9%

1,709+12%

1,2900%

731+24%

626-2%

820+19%

Insecticides

Sales in € million; ∆% y-o-y Fx & portfolio adj.

FY 2010 Nominal growth/decline FY 2011


2010 2011

Asia / Pacific

LatAm/Africa/Middle East

Europe

NorthAmerica

2011 strong performance of Seed Treatment portfolio in all regions

Successful introduction of Poncho/Votivo in corn in the US, launch in soybeans and cotton for the 2012 season

Seed treatment application centers opened in Argentina, Brazil and China

New fungicidal seed treatmentEmesto/EverGol ready for launch in Europe in 2012/2013

On track to develop remarkable seed treatment segment in Asia/Pacific

609

731 (+24%)

Seed Treatment Back on Growth PathSales in € million; ∆% y-o-y Fx adj.

2011 - Significant Margin Increase


Commitment to deliver on efficiency and restructuring program

Adjusted EBITDA* margin rose 380 bps to 22.8% in 2011 Earnings growth driven by significant volume increases and the resulting

marked improvement in capacity utilization Efficient production and strict cost management enabled us to hold

COGS down R&D expenses steady, selling expenses rose at a slower rate than sales €38m one-time gains from Crop Protection divestments (2010: €58 million) Efficiency program on track


Optimizing our Supply Chain Model and Asset Footprint

Efficient global production network and operating model create high flexibility and less capital employment

Innovative chemistry and process technology drive cost leadership, as well as safety and sustainability excellence

Fully integrated supply chain

2011: COGS/net sales ratio down by approx. 4 pp despite higher raw material prices


First registration or authorization received; launch planned for 2012/2013

New canola varieties with improved agronomic traits

Cereal fungicide

Seed treatment against nematodes

Herbicide for perennial crops

Fungicide for corn and soybeans

New cotton varieties

Proprietary glyphosate-tolerance

Combined insect-resistance andherbicide-tolerance

Numerous new vegetable varieties

Herbicide for IVM and turf segmentFungicide for fruits & vegetables

Conventional oilseed rape seed for Europe


Market launch

New soybean varieties

Seed treatment fungicide

Strong Track-record of Innovation -Highlights 2011 - 2012

IVM: Integrated vegetation management

Xpro - New Cereal Fungicide with Yield-Boosting Effect

Pyrazole fungicide from a new generation of SDHI* for foliar use in cereals

Combined formulation of Bixafen and Prothioconazole leading to superior "all-in-one" cereal fungicide

Excellent control of key cereal diseases including strobilurin-resistant Septoria

Boosting yield through long-lasting disease control and positive impact on plant physiology

Achieved above €100m sales in its first year of launch (2011)

Global peak sales potential of more than €300m

• Bayer Investor Presentation • Meet Management • March 2012Page 12* SDHI: Succinate dehydrogenase inhibitor

Luna - Outstanding Fungicide for Managing Problematic Crop Diseases

New SDHI* fungicide for use in foliar application and seed treatment on more than 70 horticultural and industrial crops

Control for a broad range of problematic diseases including Alternaria blight, scab, powdery mildew and white mold

Benefits for the food chain industry through better storability and longer shelf-life of harvested produce

US registration received and available for the 2012 planting season;further registrations expected in Europe and in Canada in the coming months

Global peak sales potential of more than €250m

• Bayer Investor Presentation • Meet Management • March 2012Page 13* SDHI: Succinate dehydrogenase inhibitor

Sales in €bn from launches 2011-2015e

€2bn Peak Sales Potential withCrop Protection Pipeline 2011-2015

2011 Peak salespotential

Launches 2011–2015e*

Insecticide

Fungicide

Fungicide

Herbicide

SeedTreatment

Herbicide

Seed Treatment

~ 0.2

~ 2.0

• Bayer Investor Presentation • Meet Management • March 2012Page 14* subject to regulatory approval

We Are The Company to Offer a Sustainable Alternative to Glyphosate

Weed resistance increasingly impacting crop production; spreading from US to Canada

LibertyLink is currently the only non-selective solution to glyphosate resistant weeds

Herbicide innovation is urgently required

In-line with our view on sustainable agriculture, we are committed to develop new and more sustainable weed management solutions Innovation with new mode of action, HPPD herbicide tolerance, in soybeans and cotton

Developing of new herbicide tolerance traits in soybeans in collaboration with other companies

Return of older chemistry - 2,4D and Dicamba - not sufficient or sustainable options in future herbicide tolerance landscape

Highly effective pre-emergent and selective herbicide portfolio recently launched


Bayer CropSciencesustains the "Respect the Rotation" initiative to overcome weed management challenges

HPPD: Hydroxyphenyl-pyruvate dioxygenase

BioScience – Double-digit Growth in all Established Crops

273 299

168227

152

17934

40

2010 2011

Other

Rice (+29%)

Cotton (+23%)

Oilseeds (+26%)

Vegetables (+12%)


687

820 (+19%)

Highlights

InVigor oilseeds outperformed the market

Important launches in cotton Proprietary glyphosate herbicide

tolerance technology GlyTol in the US

Double herbicide tolerant cotton (LibertyLink&GlyTol)

Market share gains in vegetable seedsbusiness

About 70 new vegetable seed varietieslaunched across the whole portfolio


Extend BioScience Footprint In the coming years we expect to grow organically at a similar

rate as the last 2–3 years Grow our core brands & assets

Leverage – and strengthen – our robust innovation pipeline, doubling annual R&D investment by 2015 (2010: €200 million)

Fully exploit our pipeline by driving regional expansion, new market entries and game-changing technology launches

Extend our footprint in new crops & markets,expand seed and trait research activities in wheat and soybean

Deliver customer-focused innovations by Nunhemsin strategic vegetable crops driven by molecular breeding excellence and unique, crop-based marketing


Significant Investments in BioSciencein 2011


Bayer CropScience acquires access to wheat germplasm from leading Romanian agricultural research institution*** Bayer CropScience and DuPont announce canola trait licensing agreement *** Bayer CropScience

subsidiary HILD opens new seed technology facility for vegetables and herbs *** Bayer CropScience to acquireUS-based Hornbeck Seed Company *** Alternative mode of action for herbicide tolerance now in co-development by Bayer CropScience and Syngenta *** Bayer CropScience invests USD 20 million in new BioScience

greenhouse at North American headquarters *** Bayer CropScience strengthens seed platform inEurope through acquisition of the Raps GbR oilseed rape business *** Bayer CropSciencesets up European Wheat Breeding Center *** Bayer CropScience opens Seed Analytics Laboratory in Singapore ***

Targeted acquisitions to strengthen core crops

Hornbeck Seed - to invest in southern US soybean seed market

Raps GbR - to strengthen oilseed rape business seed platform in Europe

Wheat breeding stations set-up in Europe and US

3 agreements with wheat players to broaden access to germplasm

Several research collaborations with leading technology providers

R&D investment increased by ~20%

Robust Broad Acre Seeds &Traits Development Pipeline 2012-2016*

*subject to regulatory approval / Pipeline includes both GM and Non-GM projects

2012 2013 2014 2015 2016


TwinLink + GlyTol Cotton

US

Roundup Ready HybridCanola

AUS

Canola Yield Increase

NA

Insect Resistant Hybrid Rice

Asia

LibertyLink + Roundup Ready Hybrid Canola

NA

Bayer Oilseed Rape Seed

EU

Bayer Soybean Seed

Global

GlyTol + HPPD Tolerant Soybeans

US

SubmergenceTolerant Hybrid Rice

Asia

Salinity Tolerant Hybrid Rice

Asia

Improved Canola Oil Profile

NA

Roundup Ready 2 Hybrid Canola

AUS

Dual Herb. Tol. + Novel Insect Tol. Cotton

US

Disease Resis-tant + Salinity Tol. Hybrid Rice

Asia

Disease Res. + SubmergenceTol. Hybrid Rice

Asia

Bayer WheatSeed

EU

Pipeline Highlights

Regional expansion ● Technology excellence ● Focus crop entry

Insect + Disease Res. Hybrid Rice

Asia

Changing the Game in Cotton –TwinLink + GlyTol in 2013

• Bayer Investor Presentation • Meet Management • March 2012Page 20* Pending regulatory approvals

Bayer launched first dual herbicide - dual insecticide product 2–3 years ahead of competition; TwinLink + GlyTol will provide another choice:

Two-genes for effective Lepidopteran control

Built-in tolerance to glufosinate-ammonium and glyphosate for broad-spectrum weed control

Powerful new insect and weed technology in high-yielding FiberMax & Stoneville varieties

New choices for efficient and effective crop management and increased productivity

A critical tool in the fight against weed resistance

Anticipated launch 2013 in United States; further launches planned* in Latin America and India

Build up a Global Wheat Seed Business

Broad crop knowledge and customer insight based on leading position in crop protection with strong brands and a broad presence

Invest significant resources into R&D of new wheat varieties and traits

Initial focus on productivity,stress tolerance, nutrient uptake

Establish a broad germplasm pool

Global breeding network

Collaborations with leadinginstitutions for seeds and traits

Page 21 • Bayer Investor Presentation • Meet Management • March 2012

Canada: Spring Wheat

Northern US: Spring Wheat

Nebraska: Winter Wheat

France: Winter Wheat

Germany: Winter Wheat

Ukraine: Winter and Spring Wheat

Global wheat germplasm / breeding infrastructure

Australia: Spring Wheat

1st phase : North America / Europe / Australia 2nd phase : Latin America / Asia

First new wheat varieties expected to be available by 2015 in Europe

Building a Proprietary Soybean Seed Business

2009 launch of LibertyLink herbicide tolerance technology in soybeans, licensed by more than 100 US soybean seed players

Acquisition of Hornbeck Seed Company

Supplying soybean varieties in the southern US-market

In-house soybean breeding program

Broaden market access with launch of Bayer soybean seed in 2012

Assembling a broad soybean germplasm pool throughbreeding infrastructure in North and South America

Industry-leading soybean trait pipeline

Multi-gene herbicide tolerance for sustainable, effective weedcontrol and resistance management

Game-changing Soybean Cyst Nematode (SCN) controldelivering higher yields


PositiveOutlook


Positive Outlook

We expect market conditions for our CropScience business to remain favorable in 2012

We predict above-market growth and anticipate that currency- and portfolio-adjusted sales and EBITDA before special items will advance by mid-single-digit percentages


Some more figures –

Appendix



Sales 2011: €7,255m

18%

23%

10%11%

9%

29%

Bayer CropScience –Balanced Portfolio Position

Insecticides€1,290m1-2Market position:

Fungicides€1,709m3Market position:

Seed Treatment€731m1-2Market position:

Herbicides €2,079m2Market position:

Env. Science €626m1Market position:

BioScience €820m6Market position:

Page 26preliminary estimates

Q4 2011 –Key Financials CropScience

• Bayer Investor Presentation • Meet Management • March 2012Page 27* before special items

Sales 1,653 1,676 +1.4

EBIT 118 47 -60.2

EBIT adjusted* 144 145 +0.7

EBITDA adjusted* 270 273 +1.1

Gross cash flow 188 180 -4.3

Net cash flow 410 (327) •

CapEx 158 126 -20.3

Free operating cash flow 289 (446) •


In € million Q4 2010 Q4 2011 ∆%

Emerging Economies

25%

CropScience Sales

CropScience €7,255m; +6% (+9%)Latin

AmericaEastern Europe


Emerging Asia³

~800

+5%

~1,500

+13%

~500

+21%

~300

+6%



16%

USA+14%

28%

43%

13%


Western Europe +2%

Others²+7%

2011 - Business Momentum in Emerging Markets Maintained


Sales in € million, ∆% yoy Fx adjusted

Herbicides

Fungicides

Seed Treatment

BioScience

Q4 2011 – Strong Growth of Seed Treatment and BioScience


Growth mainly driven by EuropeDecline in Asia Pacific

Successful Fox launch in Brazil Western Europe business weaker

Impacted by cessation of marketing of WHO Class I products

Business expansion in all regionsStrong performance of Poncho/Votivo

Lower specialty actives sales in EuropeBusiness increase in the US

Double-digit growth in North America, Asia/Pacific and Latin America


444+3%

397+4%

350-7%

180+21%

148-6%

157+24%

Insecticides

Sales in € million; ∆% y-o-y Fx & portfolio adj.

Q4 2010 Nominal growth/decline Q4 2011


Cereals, Vegetables and FruitsA Major Part of Our Portfolio

Cereals

Vegetables/Potatoes

Fruits/Grapes

Cotton

Soy

Corn

Oilseeds

Rice

Sugar Crops

Page 30* by major crop groups excluding industrial business and non-agricultural solutions

Bayer CropScience Sales 2011*

Other

Page 30

Global Ag Market Environment Expected to Remain Favorable in 2012

Crop commodity prices to remain relatively high, despite volatility

Farmers’ overall economic prospects should therefore remain favorable, prompting further investment in seeds and crop protection products

Latin America expected to post the strongest growth in 2012 due to benefit mainly from increase in soybean cultivation

In Asia/Pacific, agricultural production anticipated to rise, though at slower rates than in Latin America. Expansion will be driven by specialty crops such as fruit and vegetables, as well as by rice and cereals

Lower growth expected in industrialized regions of the northern hemisphere


Crop Commodity Prices Volatile, But Still at Attractive Levels

• Bayer Investor Presentation • Meet Management • March 2012Page 32Source: Reuters

Investor Handout – Meet ManagementBayer MaterialScience

March, 2012 – Leverkusen

MaterialScience –Leading Positions in All Segments


€10,832m

Polyurethanes€5,435m #1-2; approx. 22-24% market share*

50%6%

27%

17%

Sales in € million

Polycarbonates€2,893m #1; approx. 27% market share

Coatings, Adhesives, Specialties€1,845m #1; >40% market share**

Industrial Operations €659m

*depending on segment** arom. & aliph. isocyanates

Sales Split by Segment 2011

MaterialScience –Sales By Key Customer Industries


Others(sports, leisure, footwear packaging, medical, etc.)

Furniture / Wood

AutomotiveChemicals

Electro/Electronics

Construction

16%

28%

19%

20%

8%21%

16%

Bayer MaterialScience sales by industry in 2011


2011 – FurtherSales Growth, Lower Earnings

Fiscal 2011 –Key Financials MaterialScience

• Bayer Investor Presentation • Meet Management • March 2012 Page 5* before special items

Sales 10,154 10,832 +6.7

EBIT 780 633 -18.8

EBIT adjusted* 780 589 -24.5

EBITDA adjusted* 1,356 1,171 -13.6

Gross cash flow 1,058 939 -11.2

Net cash flow 763 775 +1.6

CapEx 505 574 +13.7

Free operating cash flow 265 210 -20.8


Capital invested (average) 9,589 10,157 +5.9

CFRoI 11.0% 9.2% ●


Fiscal 2011 –Operating Performance


25%

50%

27%

Polycarbonates +4% (+6%)

Polyurethanes+8% (+10%)

2010 2011

AdjustedEBITDA*

1,356

1,171


2010 2011

AdjustedEBIT*

780

589

-14%

-24%

Sales Earnings

17%6%


Coatings, Adhesives, Specialties +3% (+4%)

IndustrialOperations

+20% (+22%)

Price+7.2%

Volume+1.0%

Fx-1.7%

Portfolio+0.2%

MaterialScience €10,832m; +7% (+8%)

Fiscal 2011 –Regional Sales Development


Emerging Economies

25%

FY2011 MaterialScience Sales

MaterialScience €10,832m; +8%Latin

AmericaEastern Europe


Emerging Asia³

~2,530

+2%

~810

+13%

~630

+18%

~605

+12%



1%

USA+10%

36%

Western Europe +11%

42%


4%Others²-1%


18%

35%

42%

5%

Fiscal 2011 –Higher Input Prices Not Fully Compensated


11%margin

13%margin

Adjusted EBITDA* in € million

Actual FY‘10 Actual FY‘11Volume Price OthersSavingsRaw material/energy prices

1,171 -14% y-o-y

1,356

- Inventory reduction- Facility & asset

management costs- Start up costs for

new TDI train- Higher fixed costs


Fiscal 2011 –Impact of Raw Materials


Petrochemical feedstock prices on a high level and very volatile in the past 12 months

Total raw material costs at €5.1bn in 2011, vs. €4.3bn in 2010

Energy costs in 2011 unchanged from 2010 at €600m

Raw material price increase negatively influenced EBITDA by €780m not fully compensated by price increases

Raw Material Cost Split 2011*

Exposure by valueBenzene (incl. phenol, aniline, styrene)PropyleneTolueneOther petrochemical feedstockOthers

* Material Science raw material basket used as proxy, coversapprox. 80% of total purchased raw materials

Fiscal 2012 –Business Outlook


Q1´2012 outlook Fx- and portfolio- adjusted sales roughly in

line with Q4´2011 Adjusted EBITDA* expected well above the

level of Q4´2011, but below the respective prior year level

FY´2012 outlook In light of the weaker development in 2011,

we currently forecast Fx- and portfolio-adjusted sales and adjusted EBITDA* to remain level with the prior year

Should the market environment develop more favorably than anticipated, we expect sales and earnings to increase accordingly


Positive Long-term Trend To Continue


100 %

1992 2011

Business sales growth: 1992-2011 CAGR: +8%

Global GDP growth: 1992-2010 CAGR: +5%

Major products performing above GDP growth

Historically, long-term growth trend intact across the business cycles

Growth trend expected to continue as global megatrends need sustainable solutions

Business DevelopmentMajor products sales growth (polyurethanes and polycarbonates)

Global GDP index (nominal)Index 1992 = 100


On Global

Megatrends

Capitalize

Capitalize on Global Megatrends and Spur Future Growth

• Bayer Investor Presentation • Meet Management • March 2012 Page 13*Source: UNEP, Sustainable Buildings and Climate Initiative

**Source: World Resources Institute*** WHO recommends less than 30 dB(A); dB(A): A-weighted decibel quality

About 30% of the EU population are exposed to road traffic noise in excess of 55 dB(A) during night time***

14% of greenhouse gases worldwide origin from the transport of goods, making it the third largest emission source**

Buildings are responsible for more than 40% of globalenergy use*

Urbanization – Increasing Energy Consumption

Globalization – Increase of Greenhouse-gas Emissions

Mobility – Increasing Noise Pollution

Examples of Bayer’s Materials for Zero-emission Buildings


Polyurethane-based Insulation for Residential & Commercial Buildings


PUR Isoboards for Thermal Insulation

Growth drivers Directive 2010/31/EU of the

European Parliament: From 2020 on, new buildings have to be constructed as “nearly zero-energy buildings”

IECC* in the US: From 2012 on new and renovated homes and commercial buildings have to use 30% less energy than those build to current standards

1 kg polyurethane saves 360 to 755 kg CO2 emissions**

PUR in construction industry in 2011: approx. €4.8bn, estimated average growth rate of ~8% p.a.

*International Energy Conservation Code **Additional insulation. Savings over entire product life-cycle of 50 years, including production and end-of-life stages

PUR: polyurethane

For buildings under construction Applicable insulation for walls, roofs and floors Advantages: highest thermal insulating capacity

relative to wall thickness, moisture resistant, easy to apply, excellent long-term behavior

PUR Metal Sandwich Panels Metal – rigid PUR foam sandwich panels are

prefabricated and mainly applied for industrial and commercial buildings

Lightweight panels allow easy handling and fast site assembly

High energy efficiency for cold and freezer storage

Polycarbonate Sheets for Heat Management in Buildings


Combined light and heat management to reduce energy requirements

Significant reduction of CO2 emissions with energy-saving multi-wall sheets

Integration of solar energy panels for renewable energy solutions

Hail-impact resistance as well as good weather stability

Several advantages versus glass: Design freedom, safety, weight

Growing demand for non-electrical indoor climate control

Translucency levels of 65-85%, ensure the maximum amount of daylight can flood into buildings while infrared radiation is absorbed

Makrolon® meets international fire protection requirements (not self-igniting, does not drip flaming particles and does not allow fire to spread)

Global market size 2011 approx. 45 kt, estimated average growth rate of ~10% p.a.

Polycarbonate Multi-Wall Sheets

Growth drivers

Polyurethane-based Insulation Along the Cold Chain


For e.g. refrigerated trucks, reefer container, portable coolers

PUR combines high mechanical strength, high insulating capacity and low weight

Transportation

Growth drivers A 10 cm insulating layer can

keep food cool for up to five days without electricity – even at external temperatures of over 40 degrees Celsius

Increasing demand for trans-porting temperature sensitive goods

Increasing standard of living triggers continuously growing demand for appliances

PUR along the cold chain 2011: approx. €3bn, estimated average growth rate of ~6% p.a.

Refrigerators Replacing all old refrigerators with A++

appliances could cut annual CO2 emissions in the EU by 22 million metric tons

Insulation made out of polyurethanes helped reduce energy consumption of refrigerators by 65% from 1950-2005

PUR: polyurethane

Examples of Bayer’s Materials for Energy Efficient Cars


Load floor out ofpolyurethanes

Polycarbonate tailgate

Roof elements out of polycarbonate and polyurethanes

Seats out of polyurethanes

Instrument panels out of polycarbonate and polyurethanes

Colored polycarbonate parts for the body

Polycarbonate for flame resistant battery housings

Polyurethanes, coatings and adhesives for the body shell

Housings for chargingstations out of polycarbonate

MaterialScience‘s Solutions for Saving Weight

14

Development of material share in %*

27

5949

32

19

Polymers Steel/MetalOthers

* Based on an average automotive weight of 1,300 kg

Increased Energy Efficiency in Cars Through Polyurethanes


Growth drivers

10% less weight reduces the fuel consumption of an average car by around 5%

Polyurethane offers versatile opportunities for lightweight car design

77m light vehicles* produced globally in 2011, estimated average growth rate of 5-6% p.a.

Polyurethanes Polyurethanes are used for interior and

exterior applications like seating, instrument panels and bumpers

High noise-absorption qualities (lower acoustic level inside the car)

Bayflex® RIM Light Weight, a new material for bodywork parts reduces the weight of the parts by 20 to 30%** while retaining the mechanical properties

*includes cars and light commercial vehicles up to a weight of 6t** compared with conventional polyurethane solutions

PUR: polyurethane

Increased Energy Efficiency in Cars Through Polycarbonates


Growth drivers

Polycarbonates Heat stability and optical quality enable new

LED-based lamp lighting systems Battery housings made from flame-retardant

polycarbonate blends will protect batteries used in future cars with hybrid engines

Colored car body parts like roofs, spoilers or pillar covers from polycarbonate blends reduce weight

Automotive glazing from polycarbonate combines high weight saving potential with outstanding thermal insulation

Broad global political initiatives are promoting e-mobility

Increasing need for electrical devices requires flame retardancy of plastics

Polycarbonate glazing offers a weight advantage of 30-50% compared to real glass

77m light vehicles* produced globally in 2011, estimated average growth rate of 5-6% p.a.

*includes cars and light commercial vehicles up to a weight of 6t

Noise Reduction in the Transportation Sector


Durflex® track system stabilizes ballast stones with polyurethane foam

Creates a durable track system with long-term elasticity

Combining the strengths of ballast track (elasticity & dampening effect) with strengths of slab track (durability)

Improving the economics of track operations Reduced maintenance costs Increasing availability of the tracks

Polyurethane Noise absorption of up to

3dB(A) Reduction of vibrations by

approx. 40% 1.37 million km rail network

worldwide Addresses especially highly

frequented high-speed and heavy cargo lines

Growth drivers

Noise Reduction in the Transportation Sector


Governmental guidelines increasingly require noise reduction

Makrolon® Silent Sound reduces noise pollution up to 34dB(A)

Certified according to DIN EN 1793-2 (Noise protection measures on streets - test procedure for the determination of acoustic properties)

Wall-thickness of 18 mm with a weight of only ~22 kg/m²

Growth drivers

Polycarbonates Transparent sound walls more and more

preferred in urban environments Advantages of being transparent, light weight,

vandalism proof, flame retardant and ageing stabile

Light weight noise protection is inevitable on bridges

Used on building sites without major machine expenditure

100% recyclable


Invest toImprove & Grow

World Leading Positions in Markets with Positive Long-term Demand Growth


4,700 ktMarket capacities 2011 (name plate)

~2%Expected market capacity growth 2012

6-7%Expected average long-term demand growth p.a. (by volume)*

~27%

#1

PCS

Bayer share in business 2011 (by volume)*

Market position 2011

5,700 kt

~3-4%

6-7%

~22-23%

#1

MDI

2,200 kt

~9%

4-5%

~23-24%

#1-2

TDI

*internal estimates MDI: methyl diphenylene diisocyanate, TDI: toluene diisocyanate PCS: polycarbonate

Cash Generation in Excess of Own Investment Need, A Real Success Story


CapEx (cash-relevant)

Net Cash Flow

Free Operating Cash Flow~€ 3.5bn FOCF in 10 years

2002 and 2003 as reported in 2004 excluding acquisitions or divestments

902

464

332

715 690* 870*

649

206 166

673

277

592

1,1131,108 1,388498 1,1471,281 110

672

782

345

504

849

265

498

763

210

565

775

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

In € million

Sustain Leading Positions in Established Regions, Grow in Asia


Planned Capital Expenditures (PPE* only)

2011 2012e 2013e 2014e

€533m ~€520m

~€770m~€690m

CapEx timeline adjusted to invest in-line with growing market demand

Investments focused on two elements: Further improve cost efficiency

to sustain leading positions Grow in developing markets

Major projects include: Germany: Focus on improving

cost efficiency to sustain leadership positions

China: Focus on expansion to capture further growth potential

* Property, plant & equipment

Build on European Market Leadership WithFurther Investments


€700m in Capital Expenditures Planned in Germany

Investments focused on meeting growing local demand

New facilities use innovative process technologies for more efficient production Construction of a new multipurpose plant

for HDI and IPDI until 2013 Construction of a new 300kt/year TDI

plant* until 2014 Expansion of MDI capacity by 220kt/year

(timing t.b.d.) Expansion of PCS capacity by

100kt/year(timing t.b.d.) Chlorine production unit with new oxygen

depolarized cathode technology

* Construction of a new 300kt/year TDI facility replacing existing 205ktIPDI: isophoron diisocynate, MDI: methyl diphenylene diisocyanate, TDI: toluene

diisocyanate, HDI: hexamethylene diisocyanate, PCS: polycarbonate

Grow in China by Expanding Bayer´s Largest, Fully Integrated Site in Shanghai


Strengthening Leadership Through Further Local Production and Know-how

Second investment stage New investment of approx. €1bn in

Shanghai until 2016 to: Increase MDI capacity to

1,000kt/year Increase PCS capacity to

500kt/year Increase HDI capacity, new

50kt line planned New IPDI line planned

PCS headquarters transferred to Shanghai mid 2011

Expansion of local R&D activities

CAS

HDI30 kt in 2011

+50 kt

PUR

MDI350 kt in 2011

+650 kt

TDI250 kt in 2011

PCS

PCS200 kt in 2011

+300 kt

MDI: methyl diphenylene diisocyanate, TDI: toluene diisocyanate, IPDI: isophoronediisocyanate, HDI: hexamethylene diisocyanate, PCS: polycarbonate

MaterialScience Sales Development in Greater China


2005 2011

+11% p.a.

MaterialScience €9.4bn MaterialScience €10.8bn

8%Gr. China€1.7 bn

8%Gr. China€0.9 bn

Greater China incl. PR China, Macau, Hong Kong & Taiwan

Bayer MaterialScience Sales in Greater China in %

China – Center of Gravity of MaterialScience´s Customer Industries


The largest construction market in the world

The largest automotive market in the world

The largest railway market in the world

The largest consumer electronics market in the world

World’s second largest economy with strong momentum

World’s largest exporter

World’s largest PCS market

To become the world’s largest PUR market soon

A close second behind the US for the world’s largest Coatings market

PUR: polyurethane, PCS: polycarbonate

Opportunities for MaterialScience from China‘s 12th 5-Year Plan


Increase non-fossil fuel use to 11-12%* by 2015

Reduce energy consumption per unit of GDP by 16% by 2015Promote clean energy

Improve building energy efficiency

New energy vehicle development

Foster rail freight transportation

Heat measuring and energy saving in existing buildings

15% of energy consumption with renewable energy by 2020

Invest RMB100 billion until 2020 in electric vehicles

Target production capacity of 1m new energy vehicles by 2015

Extend high speed network to 45,000 km** by 2015

Connect every city with a population ≥500,000 habitants

*Up from currently ~8% ** Up from currently 10.000km Sources: SAI Strategic Analysis, KPMG

Getting Closer to Our Customers –Polymer R&D Center Shanghai


Broad service range:

Technical service/help

Customer trainings

Specialized laboratories for product and process R&D

Technical Service Application Development Product Development ResearchTechnical SalesPhase I started 2001 Phase II started 2006 Phase III started 2011

Phase III expansion part of our €1 billion investment program

Number of employees expected to double from currently 130

Providing a full range of R&D expertise


Focus onTechnology

Leadership

Employing State-of-the-Art Technologies in World-Scale Format


PolycarbonatesWorld-scale standard: 100kt single trains 100kt line with melt process: conversion costs -30%

MDI New world-scale standard: 350kt (becoming 500kt) Adiabatic nitration (aniline): conversion costs -25% High efficiency phosgenation: conversion costs -45% ODC* chlorine recycling: energy costs -30%

TDI New world-scale standard: 300kt Gas phase phosgenation: energy costs -40% Chlorine recycling: energy costs -50%

HDI Gas phase phosgenation: energy costs -65%

BPA and polycarbonate plant

HDI plant

MDI storage tanks

HDI plant

All improvements compare to conventional process technology

*ODC: Oxygen Depolarized Cathode

World Scale in Polycarbonates Production Reduces Costs Through Economies of Scale


2002 Map Ta Phut, Thailand(first 100kt line worldwide)

2003 Uerdingen, Germany

2006 Caojing, China

2009 Caojing ll, China

+ Further expansion of Caojing

Bayer is the only PCS producer that runs highly efficient, single

100kt lines

Name plate capacity in kt p.a. per production line

Con

vers

ion

cost

inde

x

Effect of capacity increase on conversion costs

60

70

80

90

100

60 70 80 90 100

Peer group 75kt

average

50

Bayer60kt

Bayer50kt

Bayer 100kt

world scale

100kt lines are operated in:

Bayer Has a Competitive Production Line Concept in All 3 World Regions

PCS: polycarbonate

TDI Gas Phase Process Sets New Standards For Efficiency and Safety


Process characteristics

Reaction of phosgene and TDA in the gas phase

Proprietary process new standard for efficiency

Benefits of gas phase process

Reduced conversion costs due to lower energy demand and reduced solvent usage

Reduced energy costs by approx. 40%

All improvements compare to conventional process technology

Successful operation of a 60kt pilot plant in Germany

World-scale 250kt production line in Caojing started in 2011

New Process Extends Bayer’s Cost and Technology Leadership in TDI Production

TDI: toluene diisocyanate

Sustainable Production –Making Carbon Dioxide a Feedstock


Production of high quality polyurethane foam with the help of carbon dioxide (CO2)

Substitute partially petroleum by CO2, reduce raw material costs

Unique technology, good properties of final (foam) products

Pilot plant started operating in Germany in 2011

Project partnered with RWE (supplies CO2) and RWTH Aachen

Industrial production expected to start 2015 earliest

The “Dream Production” project receives federal fundingCO2 as Feedstock

Meet Management 2012 Investor Handout

Investor Relations

Transcript of Meet Management 2012 Investor Handout