2.1 Corporate Structure

Bayer AG, headquartered in Leverkusen, Germany, is the strategic management holding company for the Bayer Group. Business operations are conducted by the HealthCare, CropScience and MaterialScience subgroups.

The globally operating HealthCare subgroup is divided into the Pharmaceuticals and Consumer Health segments. The Pharmaceuticals segment concentrates on prescription products in the fields of General Medicine, Specialty Medicine, Women’s Healthcare and Diagnostic Imaging. Our Consumer Health segment comprises the Consumer Care, Medical Care and Animal Health divisions. The Consumer Care Division has businesses in non-prescription medicines and dietary supplements. Medical Care comprises the businesses with blood glucose meters, contrast-enhanced diagnostic imaging equipment, and mechanical systems for treating constricted or blocked blood vessels. The products of the Animal Health Division are destined for use in livestock and companion animals.

CropScience is active in the fields of chemical crop protection, non-agricultural pest and weed control, seed breeding and the improvement of plant traits. Organizationally, our CropScience business is divided into the Crop Protection segment and the Environmental Science, BioScience segment. Reflecting its product offering, Crop Protection is comprised of the Herbicides, Fungicides, Insecticides and Seed Treatment business units. Within the Environmental Science, BioScience segment, the Environmental Science business unit markets non-agricultural pest and weed control products while the BioScience business unit focuses on seeds and plant traits.

MaterialScience develops, manufactures and markets high-performance products in the areas of polyurethanes, polycarbonates, and coating and adhesive raw materials. This subgroup also manufactures and markets selected inorganic basic chemicals. MaterialScience is divided into the Polyurethanes, Polycarbonates, and Coatings, Adhesives, Specialties business units, and the Industrial Operations area.

Our subgroups are supported by the Business Services, Technology Services and Currenta service companies, which are reported in the reconciliation under “All Other Segments.” The reconciliation also includes the Corporate Center and consolidation effects.

The commentaries in this report relate exclusively to continuing operations, except where specific reference is made to discontinued operations or to a total value. We had no discontinued operations to report in 2009.

Key Data by Subgroup and Segment							[Table 3.3]
	Sales		EBIT before special items*		EBITDA before special items*		EBITDA margin before special items*
	2008	2009	2008	2009	2008	2009	2008	2009
	€ million	€ million	€ million	€ million	€ million	€ million	%	%
HealthCare	15,407	15,988	2,764	3,012	4,157	4,468	27.0	27.9
Pharmaceuticals	10,030	10,467	1,760	2,018	2,920	3,193	29.1	30.5
Consumer Health	5,377	5,521	1,004	994	1,237	1,275	23.0	23.1
CropScience	6,382	6,510	1,084	1,017	1,603	1,508	25.1	23.2
Crop Protection	5,339	5,424	962	875	1,397	1,301	26.2	24.0
Environmental Science, BioScience	1,043	1,086	122	142	206	207	19.8	19.1
MaterialScience	9,738	7,520	586	(126)	1,088	446	11.2	5.9
Reconciliation	1,391	1,150	(92)	(131)	83	50	6.0	4.3
Continuing Operations	32,918	31,168	4,342	3,772	6,931	6,472	21.1	20.8
2008 figures restated * for definition see “Calculation of EBIT(DA) Before Special Items”

Changes in corporate structure

We implemented a number of organizational changes effective January 1, 2009 that affected our segment reporting and thus the presentation within the subgroups as described below. The prior-year figures have been restated accordingly. In the HealthCare subgroup, the dermatology business (Intendis) was integrated into the Consumer Care Division within the Consumer Health segment and thus is no longer part of the Pharmaceuticals segment. The Diabetes Care Division was combined with our medical equipment business Medrad – which previously formed part of the Diagnostic Imaging business unit in the Pharmaceuticals segment – to create the Medical Care Division. In the Pharmaceuticals segment we now conduct our business in the General Medicine (formerly Primary Care and Cardiology), Specialty Medicine (formerly Specialized Therapeutics, Oncology and Hematology), Women’s Healthcare and Diagnostic Imaging business units. MaterialScience is reported as a single segment. The Thermoplastic Polyurethanes (TPU) business unit was dissolved. The TPU granules business was integrated into the Polyurethanes business unit, while the TPU films activities now form part of the Coatings, Adhesives, Specialties business unit (Functional Films). In light of organizational changes, the non-core businesses previously reported as “Other Systems” are now reported under Industrial Operations.