7.2 Production

Bayer operates production facilities at more than 120 sites in 35 countries. We deploy our competencies and experience at all our sites to continuously optimize production processes and technologies, as well as infrastructure. That is because product quality and the efficiency of materials and energy are crucial competitive factors.

The safe and responsible operation of our facilities and the comprehensive safety of our employees and the people who live near our sites are of utmost importance to Bayer. Bayer also places great importance on protecting the environment and using natural resources responsibly. Accordingly, management systems have been established for the areas of health, safety, environmental protection and quality ( HSEQ stands for health, safety, environment and quality. ) that apply throughout the Bayer Group. They are integrated into all business processes and regularly audited and updated. All relevant HSEQ performance indicators from our production sites are compiled in a Group-wide Bayer site information system (BaySIS). Extensive information on the topics of safety, product stewardship, environmental protection and the corresponding management systems can be found in chapters 8 "Product Stewardship", 9 "Safety" and 10 "Environmental Protection ".

HealthCare

Sites

HealthCare operates production sites around the world at which active ingredients are manufactured and at which formulation and packaging services are performed for the product portfolio of all HealthCare divisions. The importance of the production sites within the network is regularly assessed, giving consideration to site- and product-specific criteria. Product supply strategies and site strategies are further developed and / or adjusted on this basis. The most important production and formulation sites for global product supply in 2015 are listed in the following table.

HealthCare Sites

Segment / site
Main activity
Pharmaceuticals

Bergkamen, Germany

Active ingredient production

Berkeley, California, U.S.A.

Active ingredient production based on biotechnological processes

Berlin, Germany

Formulation and packaging

Leverkusen, Germany

Formulation and packaging

Turku, Finland

Formulation and packaging of intrauterine systems

Weimar, Germany

Formulation and packaging

Wuppertal, Germany

Active ingredient production

Consumer Health

Bitterfeld-Wolfen, Germany

Formulation and packaging

Cimanggis, Indonesia

Formulation and packaging

Grenzach, Germany

Formulation, filling and packaging

Kiel, Germany

Formulation and packaging of animal health products

Myerstown, Pennsylvania, U.S.A.

Formulation and packaging

Pittsburgh, Pennsylvania, U.S.A.

Manufacture of medical devices such as contrast agent injectors and consumables

Wuppertal, Germany

Active ingredient production

Quality management

The manufacturing of pharmaceutical and medical devices is subject to extraordinarily stringent quality requirements that are based on internationally recognized standards. Compliance with these requirements at Bayer is regularly audited by internal experts, regulatory authorities and external consultants.

Online annex: 3-7.2-1:

limited assurance

Quality standards are developed on the one hand according to regulatory requirements, approvals and authorizations, and relevant standards of nongovernmental organizations and industry associations, and on the other hand according to customer expectations. These requirements are evaluated by HealthCare and integrated into an internal quality management (QM) system that is based on international standards of the ISO (e.g. ISO 9001 and ISO 13485) and the ICH (International Conference on Harmonization of Technical Requirements for Registration of Pharmaceuticals for Human Use), as well as on rules for good working practice ( GxP is a collective term for all guidelines that govern “good working practice” and are particularly relevant for the fields of medicine, pharmacy and pharmaceutical chemistry. The “G” stands for “Good” and the “P” for “Practice,” while the “x” in the middle is replaced by the respective abbreviation for the specific area of application – such as Good Manufacturing Practice (GMP), Good Laboratory Practice (GLP), Good Clinical Practice (GCP) or Good Agricultural Practice (GAP). These guidelines are established by institutions such as the European Medicines Agency or the U.S. Food and Drug Administration. ) in the development and manufacture of pharmaceuticals (e.g. Good Manufacturing Practices (GMP), Good Distribution Practices (GDP) and Good Clinical Practices (GCP)). With the help of our QM system, we effectively and transparently implement and manage the quality control processes and responsibilities according to established, documented and binding procedures and methods. The goal is to ensure the quality of our products throughout their entire life cycle and safeguard the value chain over the long term.

Investments in property, plant and equipment

HealthCare continuously invests in its global production network in order to ensure security of supply, provide the necessary capacities and satisfy regulatory requirements. Further production capacities for the manufacture of hemophilia A products are being established at the Wuppertal and Leverkusen sites through the biggest current capital expenditure program with a total volume of more than €500 million. Another major project with a volume of some €100 million is aimed at expanding production capacities in Beijing, China.

CropScience

Sites

The products of the Crop Protection and Environmental Science units are mainly produced at the company’s own production and formulation sites, the largest of which are listed in the following table:

CropScience Sites

Site
Main activity

Dormagen, Germany

Development of new production processes and manufacture of Crop Protection and Environmental Science products

Frankfurt am Main, Germany

Manufacture of Crop Protection and Environmental Science products

Nunhem, Netherlands

Vegetable seed production

Kansas City, Missouri, U.S.A.

Manufacture of Crop Protection and Environmental Science products

Knapsack, Germany

Manufacture of Crop Protection and Environmental Science products

Vapi, India

Development of new production processes and manufacture of Crop Protection and Environmental Science products

Numerous decentralized formulation and filling sites enable the company to quickly react to the needs of local markets. At these sites the active ingredients are processed into herbicides, fungicides, insecticides, seed treatment products and Environmental Science products according to local requirements and application areas. Packaging of the products also takes place in these facilities.

Production of seeds takes place at locations close to our customers in Europe, Asia, and North and South America at our own farms or under contract.

Quality management

Our CropScience products are manufactured according to high quality standards based on ISO 9001, to which more than 80% of CropScience production sites are certified. The compliance of the production processes and registered product specifications is regularly monitored by external auditors. All our products are reviewed and registered by the national authorities in the various countries, and thus fulfill the respective requirements with regard to quality and user safety.

Investments in property, plant and equipment

We invest continuously in our global production network in order to generate capacities for new products and technologies and to improve manufacturing processes. We plan to significantly increase our capital investment to meet the steadily rising demand. We intend to invest approximately €2.4 billion in property, plant and equipment between 2013 and 2016.

The construction of a new crop protection facility for the production of methane phosphorous acid ester (MPE), an important precursor for the active ingredient glufosinate-ammonium, commenced at the Knapsack site. The capital expenditure volume is more than €150 million. In September 2015, we expanded our capacity for oilseed rape / canola through the construction of a new production site in Monheim, Germany.

Covestro

Covestro operates a large number of locations worldwide, including eight world-scale production sites. The company also maintains specialized technical centers around the world that offer customers individually tailored solutions and that are designed for regional supply. Covestro thus guarantees not just a global presence, but also above all customer centricity with short supply times and flexible service. At these production sites Covestro pursues the ambitious goal of assuming and further expanding its leading position in the future, too, with regard to production volume, quality, efficiency and safety. Innovative and environmentally friendly production processes are employed as a result of the continuous technological improvement of our facilities. The selectively backwards-integrated production process enables Covestro to procure key raw materials such as chlorine and propylene oxide from within the company or through joint ventures so as to reduce the dependency on external supply sources.

Sites

Covestro’s most important production sites are listed in the following table:

Covestro Sites

Site
Main activity

Leverkusen, Germany

Coatings, adhesives and specialties production; technical laboratories; chlorine production

Uerdingen, Germany

Polycarbonates and polyurethanes (MDI) production; chlorine and CO production

Dormagen, Germany

Polyurethanes (TDI, PET) and coatings, adhesives and specialties production; chlorine and nitric acid production

Baytown, Texas, U.S.A.

Polyurethanes (MDI, TDI), polycarbonates and coatings, adhesives and specialties production

Shanghai and Shanghai Chemical Industry Park, China

Polyurethanes (MDI, TDI), polycarbonates and coatings, adhesives and specialties production; chlorine production

Brunsbüttel, Germany

Polyurethanes (MDI) production

Antwerp, Belgium

Polyurethanes (PET) and polycarbonates production

Map Ta Phut, Thailand

Polycarbonates and coatings, adhesives and specialties production

To serve our differentiated businesses, we maintain several production facilities in selected countries that include systems houses where we formulate and supply customized polyurethane systems, as well as plants where we compound polycarbonate granules to meet specific customer requirements or manufacture semi-finished products (polycarbonate sheets). We also operate regional production facilities for derivatives of the Coatings, Adhesives, Specialties Business Unit and for functional films made of polycarbonate or thermoplastic polyurethane.

Quality management

Covestro applies very high standards for the quality of the raw materials it uses and their further processing into high-tech plastics and polymer precursors. A quality management system was implemented for this purpose that is certified to the international standard ISO 9001. In terms of total energy consumption, over 99.97% of the reporting production and nonproduction sites of Covestro worldwide are certified. This is regularly monitored by internal and external auditors.

Investments in property, plant and equipment

To safeguard competitiveness, Covestro continuously invests in a global production network so as to maintain the production facilities and their infrastructure, optimize production processes and, in the case of profitable growth prospects, appropriately expand capacities. Due to the significant expansion of capacities in recent years, Covestro plans to invest less through 2020 and focus on maintaining and optimizing existing production facilities.