© Reuters. FILE PHOTO: Logo and flags of Bayer AG are pictured outside a plant of the German pharmaceutical and chemical maker in Wuppertal, Germany August 9, 2019. REUTERS/Wolfgang Rattay/File Photo

By Ludwig Burger and Patricia Weiss

FRANKFURT (Reuters) – Bayer (OTC:)’s strategic review will consider a potentially tougher outlook for cash flows, its CEO said on Tuesday, after the German conglomerate suffered a major drug development setback.

The group late on Sunday aborted a large late-stage trial testing a new anti-clotting drug due to lack of efficacy, throwing its most promising development project in doubt, and adding to litigation and debt problems.

“Anything that effects future cash flows negatively just makes that a little tighter,” CEO Bill Anderson said in an analyst call on Tuesday.

“The impact of these recent events does not change what our strategic options are. It just may mean that some of those conditions are a little tighter,” said Anderson, who has said he is considering a break-up of the maker of pharmaceuticals, non-prescription treatments and products for farmers.

He gave the example that a potential sale of the consumer products unit to a rival in the industry would generate more cash, and faster, than a partial spin-off on the stock market and gradual sale of any remaining shares over time.

The head of pharmaceuticals, Stefan Oelrich, said in the call that when reviewing the halted trial his team was surprised by a “marked difference” in efficacy of Bayer’s experimental anticoagulant asundexian in comparison to Bristol-Myers Squibb (NYSE:) and Pfizer (NYSE:)’s established Eliquis.

The peak sales potential of more than 5 billion euros would be revised lower, but plans to bring the product to market in 2026 remained in place, albeit for a smaller patient group, Oelrich added.

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