Bayer, BioNxt Solutions, Evotec – False tariff alarm for pharma and biotech! Which stocks are worth buying?

Bayer – With strategic decisions

Bayer AG is heading into a critical year in 2025, which CEO Bill Anderson describes as the most challenging year in the ongoing turnaround. Forecasts show stagnating revenues of between EUR 45-47 billion and a decline in adjusted EBITDA to EUR 9.3-9.8 billion. The reasons for this are a debt burden of over EUR 32 billion and ongoing glyphosate lawsuits that have already resulted in USD 10 billion in legal costs. At the same time, the Company is pushing ahead with a profitability initiative in its agricultural division: By 2029, margins in the Crop Science segment are expected to increase by five percentage points to over 20% - driven by innovation and cost savings.

Despite the turbulence, Bayer is focusing on future-oriented products in its pharmaceutical segment. Two potential blockbusters are about to be launched - The heart drug Beyonttra (Acoramidis) and Elinzanetant for the treatment of menopausal symptoms. Both could generate annual revenue of over EUR 1 billion each. In addition, the Company is intensifying research in cell and gene therapies, for example for Parkinson's disease. From 2027, the pharmaceuticals division is expected to grow again and deliver higher margins – a key to long-term debt reduction.

US litigation remains an existential risk. Following a recent judgment in Georgia awarding USD 2.1 billion in damages, Bayer has again appealed to the Supreme Court in an effort to enforce a uniform federal ruling. A failure could trigger additional billion-dollar claims. Although CEO Anderson emphasizes progress in risk minimization by 2026, investors should closely monitor the litigation dynamics. In the short term, debt, weak cash flows, and legal uncertainties are weighing on the stock. In the long run, pharmaceutical innovations and the agricultural strategy could pave the way for a turnaround starting in 2026. The DAX crash has dragged the stock down with it, and at EUR 18.81 it is trading close to the 2024 low of EUR 18.40.

BioNxt Solutions - European Expansion

BioNxt Solutions is intensifying its presence in Europe by moving into a modern research center in Munich. The cooperation with the Gen-Plus laboratory enables the development of transdermal and orally soluble drugs in significantly less time and also strengthens networking within the industry. At the same time, the Company is pushing ahead with regulatory approvals to establish its products on the European market. The appointment of David Waterhouse to the board underscores the focus on strategic growth initiatives. The Company benefits from his expertise in capital raising, financial strategy, business development, sales, and supply chain management.

At the center of development is the sublingual cladribine preparation BNT23001 for the treatment of multiple sclerosis. Clinical studies are expected to confirm bioequivalence to the conventional tablet form. This would be a breakthrough for patients with swallowing difficulties, as the orally dissolvable film eliminates the need to swallow tablets. At the same time, BioNxt secured international patents for drug delivery systems, including applications in autoimmune therapy. This patent portfolio creates exclusivity and lowers the risk of imitation. The Company's announcement that it is entering the longevity market (anti-aging), which has a projected volume of USD 93 billion by 2027, with enteric-coated formulations, demonstrates its diversification strategy.

On March 14, BioNxt Solutions completed a private placement of Convertible Debentures, which raised a total of CAD 2.5 million. A total of 5 million units were issued, each consisting of a CAD 0.50 principal amount, bearing interest at 8%, and a warrant to purchase one share of the Company at CAD 0.60. The proceeds will be used to advance commercialization plans. The stock has gained 76% since the beginning of the year, followed by a sideways movement. Last Friday, it was dragged down and is now in the support area between CAD 0.35 and CAD 0.45. Currently, one share costs CAD 0.44.

Evotec - Between innovative strength and financing pressure

Evotec, a global player in drug development, continues to focus on partnerships with pharmaceutical giants such as Bristol Myers Squibb (BMS). At the beginning of March, Evotec achieved a milestone in its neuroscience collaboration with BMS. A preclinical program to combat neurodegenerative diseases was successfully completed, resulting in a milestone payment of USD 20 million. At the same time, its subsidiary Just - Evotec Biologics (JEB) is showing momentum – its revenues grew by 74% in the last quarter. In addition, the partnership with Sandoz in the biosimilars field could generate up to USD 640 million in milestone payments in the long term. Such alliances stabilize cash flows and underscore Evotec's role as an innovation partner.

Despite scientific successes, the financial situation remains tense. Profit margins have shrunk and losses per share are estimated at EUR 0.77 for 2024. This is due to high R&D costs and delayed approvals – only three drug candidates are in Phase 2 clinical trials. Digital tools are offering hope. AI platforms such as "PanHunter" are accelerating drug development. Paul Hitchin has been at the Company's helm since March and brings with him experience from transformation projects at GE Healthcare. His role will be to push ahead with efficiency programs and increase profitability.

With a market capitalization of around EUR 979 million, Evotec operates as a niche player in the biotech sector, specializing in preclinical research. Analysts such as RBC see potential despite the share price decline. The target price of EUR 11.60 is well above the current level of EUR 5.24. Last year, takeover rumors arose around this price level. April 17 will be crucial when Evotec presents its financial data and a new strategy. In the long term, success depends on whether research successes lead to marketable therapies – and whether JEB can close the profitability gap.

The temporary exemption from customs tariffs gives pharmaceutical and biotech companies breathing space, but structural risks remain. Bayer is struggling with US lawsuits and debt, but is counting on blockbusters like Beyonttra and agricultural innovations for a turnaround from 2026. BioNxt Solutions scores with disruptive delivery technologies such as the sublingual MS drug BNT23001 and is expanding in Europe – supported by patents and fresh capital. Evotec uses AI-based research and alliances with large pharmaceutical companies but needs to stabilize its strained financial position through efficiency programs. All three candidates have the potential to achieve higher prices in the long term.