Bayer – Back from the dead
Today Bayer (NYSE:BAY) announced their second results which confirmed what everyone knew already, their blood glucose monitoring business has risen from the grave. The rebirth of this unit is directly tied to the company’s wise decision to concentrate on ease of use over advanced technology.
According to the company the BGM unit experienced a 20% growth rate which far exceeds both market growth and anything seen by their competitors.
Bayer’s resurgence should send a clear message to both Abbott (NYSE:ABT) and Roche who have seen their market share erode. A message that is reinforced by LifeScan, the market leader, who has also been stressing ease of use over advanced technology. That fact of the matter is LifeScan and Bayer get it while Abbott and Roche don’t. Although Diabetic Investor does not see Bayer overtaking Roche anytime in the near future, we continue to see the company putting distance between themselves and Abbott.
The question here is will the new management teams at Abbott and Roche be able to stop the bleeding and reinvigorate their franchises as well as the Bayer team did.