Interview with Werner Baumann — CEO of Bayer AG and responsible Board of Management member for Leaps by Bayer since January 2020
2022 marks the 7th year of Leaps by Bayer, with over €1.5B invested into 54 portfolio companies to date. Why has Leaps become an integral part of Bayer’s innovation strategy?
Leaps is like a speedboat attached to an ocean liner. The big boat can travel far and wide, but it can’t navigate every channel. So the little speedboat takes off to explore distant waters. We have a world-class enterprise devoted to R&D in our three divisions, but it’s also important for us to have the capability to stay on top of progress outside our traditional areas of expertise. This is especially the case as technological developments accelerate and intersect with biotech, unlocking new approaches that were out of reach even five, ten years ago. Like the idea of engineering microbes to store carbon in the soil or enable nitrogen fixation in plants, as our portfolio company Andes is working on. A lot of these types of creative solutions are coming from the startup world, which gives us the exciting opportunity to help their ideas come to life via Leaps. Ultimately, we’re trying to solve the biggest challenges in health and agriculture. To be successful, we need to work together.
How does Leaps fit into Bayer’s vision of health for all, hunger for none?
Breakthrough innovation and sustainability are critical to Bayer as a whole, and Leaps is one way for us to tackle that. Their focus on making big, bold paradigm shifts, like moving from treating to preventing diseases, and growing better food with fewer resources, is exactly the kind of strategy we need to realize our long-term vision.
In 2022, Leaps announced a commitment to invest another €1.3B through 2024. Why is Bayer doubling down on Leaps even as the broader biotech markets have cratered?
It’s a high-risk, high-reward proposition. Regardless of this year’s challenges, the technologies we are investing in are those we urgently need in the years and decades to come. I am personally very dedicated to growing Leaps for this reason. Yes, 2022 was a year with extremely worrying news, in particular, a war in the heart of Europe that caused shockwaves around the globe and serious consequences for food and energy supplies. It’s true that this also had an impact on markets and business decisions. But if we were only to play it safe, would we be able to feed 10 billion people in 30 years, or cure the diseases we have a shot at curing? Leaps is about much more than the market’s ups and downs. It’s the bet we must make for a sustainable future.
Are the technologies from the Leaps investments in competition with Bayer’s own R&D?
No, in fact, it’s quite the opposite. They are highly complementary. Leaps only invests in tech where we don’t have existing IP. There’s great appreciation from our teams in pharma and crop science R&D because they know these technologies may come their way at some point. For example, once research-focused startups finish phase 2b or phase 3 trials, they often need a bigger commercial partner to advance their assets. That could be a clear win-win.
Leaps is all about breaking through seemingly impossible challenges, like curing cancer and reducing the environmental impact of agriculture. How realistic is it that their investments will actually pay off?
Many of the Leaps’ investments are seed rounds and Series A. Therefore, we anticipate fairly long timelines before any products or therapies are commercialized. These longer runways are a key part of the Leaps model, freeing up the companies to focus on the development work rather than constant fundraising. That said, we have already seen exciting milestones.
BlueRock, for example, was one of Leaps’ first investments, and was acquired fully by Bayer in 2019 to build up our cell and gene therapy capabilities. The lead program is in Parkinson’s disease, engineering stem cells to replace damaged neurons, and enrollment in the Phase 1 trial has now been completed.
On the ag side, CoverCress is a Leaps portfolio company that Bayer acquired a majority stake in this year. By gene editing a common winter weed that normally wouldn’t provide farmers with much value, they’ve created a new kind of cash crop that produces an oil useful as both a low-carbon aviation fuel source and animal feedstock, giving farmers a new revenue stream and a really interesting approach to decarbonizing agriculture.
We don’t realistically expect to achieve every single one of the 10 Leaps in the near future. That’s the nature of high risk, high reward. But if only a few technologies are successful, helping to reduce disease and improve our food system, that would provide a meaningful return for humanity.
It’s thrilling to imagine a future of abundant, affordable food and healthier, longer lives for future generations. Which of the Leaps is most personally important to you, if you could achieve only one?
That’s like trying to pick a favorite child! (laughs) No, really, it’s hard to choose, as they are each necessary and would be enormously impactful. But if I had to choose one, I’d probably pick Leap 7, provide next-generation healthy crops. The challenge of feeding the world in the next few decades will be increasingly difficult in the face of climate change, population growth, limited arable land, and other factors. Not to mention, 1 in 5 deaths worldwide are connected to a poor diet. If we can figure out how to grow more and better food with fewer resources, that would be a huge success for all of us.