Notice of the Annual Stockholders Meeting on Friday, April 27, 2007

Notice of the Annual Stockholders Meeting on Friday, April 27, 2007

Contents Agenda 3 1. Submission of the Approved Annual Financial Statements and Consolidated Financial Statements, the Management Reports for Bayer AG and the Bayer Group, and the Report of the Supervisory Board for Fiscal Year 2006; Resolution on Distribution of Profit 3 2. Ratification of Actions of Members of the Board of Management 3 3. Ratification of Actions of Members of the Supervisory Board 4 4. Elections to the Supervisory Board 7 5. Revocation of Existing Authorized Capital ii, Creation of New Authorized Capital ii with the Option of Excluding Subscription Rights and Corresponding Amendment of 4 (3) of the Articles of Incorporation (Capital Stock) 10 6. Authorization to Purchase Company Shares and Sell Company Shares Subject to Exclusion of Subscription Rights 16 7. Approval of the Control Agreement between the Company and Bayer Schering GmbH 17 8. Appointment of Auditors Extracts from the Annual Report 2006 20 Chairman s Letter 24 Investor Information 30 Bayer News Highlights 2006 / 2007 36 Awards 2006 / 2007 40 Bayer Group Consolidated Statements of Income 41 Bayer Group Consolidated Balance Sheets 42 Bayer Group Consolidated Statements of Cash Flows 43 Bayer Group Consolidated Statements of Recognized Income and Expense 44 Supervisory Board and Board of Management 45 Organization Chart 46 Financial Calendar 46 Masthead 47 Key Data Bayer Group Cover picture Invigorating drug discovery: following Bayer s successful acquisition of Schering AG, Berlin, Germany, the two companies researchers have joined forces in the search for new drugs. The picture shows two Bayer Schering Pharma scientists Dr. Ulrike Fuhrmann, formerly of Schering, and Dr. Thomas Krämer, formerly of Bayer Pharmaceuticals meeting for an exchange of views. In the background is a laboratory at the research center in Wuppertal, Germany.

Agenda This is to give Notice of our Annual Stockholders Meeting to be held on Friday, April 27, 2007 at 10:00 hours (cest) Cologne-Deutz Exhibition Center, North Entrance, Hall 9, Deutz-Mülheimer-Straße 111, 50679 Cologne, Germany. Agenda 1. Submission of the Approved Annual Financial Statements and Consolidated Financial Statements, the Management Reports for Bayer AG and the Bayer Group, and the Report of the Supervisory Board for Fiscal Year 2006; Resolution on Distribution of Profit The Board of Management and the Supervisory Board propose that the balance sheet profit in the amount of Euro 764,341,920.00 be used to pay a dividend of Euro 1.00 per share entitled to dividends. If, at the time the resolution on distribution of profit is passed by the Stockholders Meeting, the Company holds Company shares which pursuant to Article 71b of the German Stock Corporation Act (Aktiengesetz) are not entitled to dividends, then an appropriately modified resolution on distribution of profit will be submitted to the Stockholders Meeting which in addition to the payment of a dividend of Euro 1.00 per share entitled to dividends allows a profit brought forward to be shown. 2. Ratification of Actions of Members of the Board of Management The Board of Management and the Supervisory Board propose to ratify the actions of the members of the Board of Management holding office during the 2006 fiscal year with respect to that year. 3. Ratification of Actions of Members of the Supervisory Board The Board of Management and the Supervisory Board propose to ratify the actions of the members of the Supervisory Board holding office during the 2006 fiscal year with respect to that year.

Bayer Annual Stockholders Meeting 2007 Agenda 4. Elections to the Supervisory Board The term of office of all the stockholders representatives on the Supervisory Board expires at the end of the 2007 Annual Stockholders Meeting. Pursuant to Articles 96, para. 1 and 101, para. 1 of the German Stock Corporation Act (Aktiengesetz) and Article 7, para. 1, sentence 3, no. 3 of the German 1976 Codetermination Act (Mitbestimmungsgesetz), the Supervisory Board is composed of 10 members representing the stockholders and 10 members representing the employees. The stockholders representatives are elected by the Annual Stockholders Meeting, which is not bound by nominations. The Supervisory Board proposes that a) Dr. Paul Achleitner, Munich; Member of the Board of Management of Allianz SE, Munich b) Dr. Clemens Börsig, Frankfurt a. M.; Chairman of the Supervisory Board of Deutsche Bank AG, Frankfurt a.m. c) Prof. Dr.-Ing. e. h. Hans-Olaf Henkel, Berlin; Honorary professor of University of Mannheim, Mannheim d) Dr. rer. pol. Klaus Kleinfeld, Munich; Chairman of the Board of Management of Siemens AG, Munich e) Dr. rer. nat Helmut Panke, Munich; Formerly Chairman of the Board of Management of BMW AG, Munich f) Dr. rer. pol. Manfred Schneider, Leverkusen; Chairman of the Supervisory Board of the Company, Leverkusen g) Dr.-Ing. Ekkehard D. Schulz, Duesseldorf; Chairman of the Board of Management of ThyssenKrupp AG, Duisburg/Essen h) Dr. Klaus Sturany, Dortmund; Member of the Board of Management of RWE AG, Essen i) Dipl.-Ing. Dr.-Ing. e. h. Jürgen Weber, Hamburg; Chairman of the Supervisory Board of Deutsche Lufthansa AG, Cologne j) Prof. Dr. Dr. h. c. Ernst-Ludwig Winnacker, Brussels; Secretary-General of the European Research Council, Brussels be elected to the Supervisory Board, their term of office to last until the end of the Annual Stockholders Meeting that resolves on the ratification of their actions with respect to the 2011 fiscal year. The Annual Stockholders Meeting is not bound by nominations in electing stockholders representatives. The elections shall be carried out individually. It is intended that Dr. Manfred Schneider be the chair of the Supervisory Board. The corporate offices currently held by the persons proposed for election to the Supervisory Board as stockholders representatives are listed in the Annex to Agenda Item 4 in this Notice of the Annual Stockholders Meeting. * * *

Annex to Agenda Item 4 The persons proposed for election to the Supervisory Board as stockholders representatives under Agenda Item 4 hold offices as members of supervisory boards required by law to be established or comparable supervisory bodies of the following German or foreign corporations: Dr. Paul Achleitner a) Member of supervisory boards required by law to be established: Allianz Deutschland AG, Munich Allianz Global Investors AG, Frankfurt a. M. Allianz Lebensversicherungs-AG, Stuttgart RWE AG, Essen b) Member of comparable supervisory bodies of German or foreign corporations: Allianz Elementar Lebensversicherungs-AG, Vienna (Chairman) Allianz Elementar Versicherungs-AG, Vienna (Chairman) Allianz Investment Bank AG, Vienna (vice Chairman) Dr. Clemens Börsig a) Member of supervisory boards required by law to be established: Deutsche Bank AG, Frankfurt a. M. (Chairman) Deutsche Lufthansa AG, Cologne Heidelberger Druckmaschinen AG, Heidelberg (until 31 March 2007) Linde AG, Wiesbaden b) Member of comparable supervisory bodies of German or foreign corporations: Foreign & Colonial Eurotrust Plc., London Prof. Dr.-Ing. e. h. Hans-Olaf Henkel a) Member of supervisory boards required by law to be established: Continental AG, Hannover DaimlerChrysler Aerospace AG, Munich EPG AG, Saarbruecken SMS GmbH, Duesseldorf b) Member of comparable supervisory bodies of German or foreign corporations: Brambles Industries Ltd., Sydney Ringier AG, Zofingen (Switzerland) Dr. rer. pol. Klaus Kleinfeld a) Member of supervisory boards required by law to be established: none b) Member of comparable supervisory bodies of German or foreign corporations: Alcoa Inc., Pittsburgh Citigroup Inc., New York Dr. rer. nat. Helmut Panke a) Member of supervisory boards required by law to be established: none b) Member of comparable supervisory bodies of German or foreign corporations: Microsoft Corporation, Seattle UBS AG, Zurich

6 Dr. rer. pol. Manfred Schneider a) Member of supervisory boards required by law to be established: Bayer Annual Stockholders Meeting 2007 Agenda DaimlerChrysler AG, Stuttgart Linde AG, Wiesbaden (Chairman) Metro AG, Duesseldorf RWE AG, Essen TUI AG, Hannover b) Member of comparable supervisory bodies of German or foreign corporations: none Dr.-Ing. Ekkehard D. Schulz a) Member of supervisory boards required by law to be established: AXA Konzern AG, Cologne MAN AG, Munich (Chairman) RAG AG, Essen (vice Chairman) RAG Beteiligungs-AG, Essen (vice Chairman) RWE AG, Essen ThyssenKrupp Elevator AG, Duesseldorf (Chairman) ThyssenKrupp Services AG, Duesseldorf (Chairman) ThyssenKrupp Technologies AG, Essen (Chairman) b) Member of comparable supervisory bodies of German or foreign corporations: none Dr. Klaus Sturany a) Member of supervisory boards required by law to be established: Commerzbank AG, Frankfurt a. M. Hannover Rückversicherung AG, Hannover Heidelberger Druckmaschinen AG, Heidelberg RAG AG, Essen (until 19 March 2007) RAG Beteiligungs-AG, Essen (until 19 March 2007) b) Member of comparable supervisory bodies of German or foreign corporations: Österreichische Industrieholding AG, Vienna Dipl.-Ing. Dr.-Ing. e. h. Jürgen Weber a) Member of supervisory boards required by law to be established: Allianz Lebensversicherungs-AG, Stuttgart Deutsche Bank AG, Frankfurt a. M. Deutsche Lufthansa AG, Cologne (Chairman) Deutsche Post AG, Bonn (Chairman) Voith AG, Heidenheim Willi Bogner GmbH & Co. KGaA, Munich b) Member of comparable supervisory bodies of German or foreign corporations: Loyalty Partner Holding GmbH, Munich (Chairman) Tetra Laval Group, Pully (Switzerland) Prof. Dr. Dr. h. c. Ernst-Ludwig Winnacker a) Member of supervisory boards required by law to be established: KWS Saat AG, Einbeck Medigene AG, Martinsried (Chairman) Wacker Chemie AG, Munich b) Member of comparable supervisory bodies of German or foreign corporations: none * * *

5. Revocation of Existing Authorized Capital II, Creation of New Authorized Capital II with the Option of Excluding Subscription Rights and Corresponding Amendment of 4 (3) of the Articles of Incorporation (Capital Stock) The current Authorized Capital ii ( 4 (3) of the Articles of Incorporation) has been partially used up and shall therefore be renewed. The Board of Management and the Supervisory Board therefore propose to resolve that: a) The authorization of the Board of Management to increase with approval of the Supervisory Board the capital stock of the Company by up to Euro 98,960,000.00 until April 27, 2011 as provided in 4 (3) of the Articles of Incorporation (Authorized Capital ii) shall be revoked by deleting 4 (3) of the Articles of Incorporation. b) The Board of Management shall be authorized, until April 26, 2012 and with approval of the Supervisory Board, to increase the capital stock by up to a total amount of Euro 195,000,000.00 in one or more installments by issuing new bearer non-par stock in exchange for cash contributions (Authorized Capital ii). In such case, the stockholders shall be granted subscription rights. In case of singular or repeated exercise of the Authorized Capital ii and with approval of the Supervisory Board, the Board of Management shall however be authorized to exclude subscription rights of the stockholders in an amount of the capital increase not exceeding 10% of the capital stock existing at the time this authorization becomes effective and existing at the time this authorization is exercised for purposes of issuing new stock in exchange for cash contributions at an issue price not materially below the market price of the Company s stock already listed on the stock exchange at the time the issue price is finally determined. Stock which was acquired on the basis of an authorization of the Stockholders Meeting and is sold pursuant to Article 71, para. 1, no. 8, sentence 5 of the German Stock Corporation Act (Aktiengesetz) in conjunction with Article 186, para 3, sentence 4 of the German Stock Corporation Act (Aktiengesetz) during the term of this authorization shall apply towards the above-mentioned 10% limit. Moreover, those stocks shall be applied towards this limit which were or are to be issued in satisfaction of bonds with conversion rights or attached warrants or which are mandatorily convertible if the bond was issued during the term of this authorization subject to exclusion of the subscription rights under analogous application of Article 186, para.3, sentence 4 of the German Stock Corporation Act (Aktiengesetz). Subject to approval of the Supervisory Board, the Board of Management shall decide on the content of the stock rights and further conditions of the stock issuance including the issue price. c) Upon entry into the commercial register of the deletion of the current text pursuant to (a), 4 (3) of the Articles of Incorporation shall be replaced with the following text: (3) The Board of Management is authorized until April 26, 2012 and with approval of the Supervisory Board, to increase the capital stock up to a total amount of Euro 195,000,000.00 in one or more installments by issuance of new bearer non-par stock in exchange for cash contributions (Authorized Capital ii). In such case, the stockholders shall be granted subscription rights. In case of singular or repeated exercise of the Authorized Capital ii and with approval of the Supervisory Board, the Board of Management is, however, authorized to exclude subscription rights of the stockholders in an amount of the capital increase not exceeding 10% of the capital stock existing at the time this authorization becomes effective and existing at the time this authorization is exercised for purposes of issuing new stock in exchange for cash contributions at an issue price not materially below the market price of the Company s stock

Bayer Annual Stockholders Meeting 2007 Agenda already listed on the stock exchange at the time the issue price is finally determined. Stock which was acquired on the basis of an authorization of the Stockholders Meeting and is sold pursuant to Article 71, para. 1, no. 8, sentence 5 of the German Stock Corporation Act (Aktiengesetz) in conjunction with Article 186, para 3, sentence 4 of the German Stock Corporation Act (Aktiengesetz) during the term of this authorization shall apply towards the above-mentioned 10% limit. Moreover, those stocks shall be applied towards this limit which were or are to be issued in satisfaction of bonds with conversion rights or attached warrants or which are mandatorily convertible if the bond was issued during the term of this authorization subject to exclusion of the subscription rights under analogous application of Article 186, para. 3, sentence 4 of the German Stock Corporation Act (Aktiengesetz). Subject to approval of the Supervisory Board, the Board of Management shall decide on the content of the stock rights and further conditions of the stock issuance including the issue price. d) The Supervisory Board shall be authorized to amend 4 (1) and (3) of the Articles of Incorporation to correspond to the current use of the Authorized Capital ii or after expiration of the authorization term. e) The Board of Management is instructed to apply for entry into the commercial register of the above under (a) approved revocation of the Authorized Capital ii contained in the current 4 (3) of the Articles of Incorporation only once it is ensured that, immediately after entry of the deletion of the current 4 (3) of the Articles of Incorporation, the approved creation of the new Authorized Capital ii in the amount of Euro 195,000,000.00 with the corresponding amendments to the Articles of Incorporation pursuant to the above Agenda Items (b) and (c) are entered into the commercial register. * * *

Report of the Board of Management pursuant to Article 203, para. 2, sentence 2 in conjunction with Article 186, para. 4, sentence 2 of the German Stock Corporation Act (Aktiengesetz) concerning Agenda Item 5 Generally, in the event that the Authorized Capital ii is exercised, we want to grant our stockholders subscription rights, but would like to have the option of excluding such rights in one particular case, namely pursuant to Article 203, para. 1, sentence 1, Article 203, para. 2 and Article 186, para. 3, sentence 4 of the German Stock Corporation Act (Aktiengesetz): This possibility serves the interest of the Company in reaching the best possible issue price when issuing new stock. The statutory option provided in Article 186, para. 3, sentence 4 of the German Stock Corporation Act (Aktiengesetz) puts the Board of Management, with approval of the Supervisory Board, in a position to respond quickly and flexibly as well economically to current favorable market opportunities. In so doing, a best possible increase in equity will be attained which is in the interests of the Company and all stockholders. By waiving the time-consuming and costly procedure of subscription rights, the equity needs arising from short-term market opportunities may be quickly covered and new domestic and foreign stockholders won over. This option of increasing capital under optimum conditions and at a nominal expense to subscription rights is particularly important for the Company because it allows it to react quickly and with flexibility to market opportunities in new and fast-changing markets and to cover any equity needs arising therefrom on a short-term basis. Stock issued under exclusion of subscription rights pursuant to Article 186, para. 3, sentence 4 of the German Stock Corporation Act (Aktiengesetz) may not exceed 10% of the capital stock, neither at the time that the authorization takes effect nor at the time the authorization is exercised. In calculating this limit, Company stock sold during the term authorized for excluding subscription rights pursuant to Article 186, para. 3, sentence 4 of the German Stock Corporation Act (Aktiengesetz) will be included. Further included in calculating this limit are those stocks which were or are to be issued in satisfaction of bonds having conversion rights or attached warrants or obligatory conversion rights if the bonds were issued during the term of this authorization under exclusion of subscription rights in analogous application of Article 186, para. 3, sentence 4 of the German Stock Corporation Act (Aktiengesetz). These conditions take into account the interests of the stockholders with respect to the protection against the dilution of their stockholdings in compliance with the respective statutory provisions. The issue price and thus the funds flowing to the Company for the new stock will orient itself to the market price of already floating stock and will not significantly fall short of the market price, the price expected to be not less than 3% but in no case less than 5% compared to the current market price. In view of the fact that all stock issued in the past by the Company is admitted for trade in the official markets of the German stock exchanges and that they are widely held, stockholders desiring to maintain their percentage of stockholding may purchase additional stock of the Company on the stock market without any problem in cases where the Authorized Capital ii under exclusion of subscription rights pursuant to Article 186, para. 3, sentence 4 of the German Stock Corporation Act (Aktiengesetz) is utilized. In calendar year 2006 more than 1.4 billion non-par stock of the Company were traded on German stock exchanges equaling almost double the total number of Company stock.

10 Generally it is therefore ensured that in keeping within the statutory parameters of Article 186, para. 3, sentence 4 of the German Stock Corporation Act (Aktiengesetz), stockholder Bayer Annual Stockholders Meeting 2007 Agenda capital interests as well as stockholder voting rights are reasonably preserved in the event that Authorized Capital ii is utilized under exclusion of subscription rights. Taking all of these circumstances into account, the authorization to exclude subscription rights subject to the above restrictions is necessary, suitable, reasonable and demanded by the interests of the Company. * * * 6. Authorization to Purchase Company Shares and Sell Company Shares Subject to Exclusion of Subscription Rights Due to the expiration by October 27, 2008 of the authorization adopted by the last Annual Stockholders Meeting, the Board of Management shall, subject to the revocation of this authorization, again be authorized to purchase Company shares. To the extent the shares will be utilized for stock compensation programs, these programs for the years 2000 to 2002 have already been the subject of Stockholders Meeting resolutions in past years for the shares issued in each of the respective years. The Board of Management and the Supervisory Board propose adoption of the following resolution: a) The Company is authorized until October 26, 2008 to purchase Company shares representing up to 10% of the Company s current capital stock. The purchase must be made on the stock exchange. The purchase price (excluding incidental costs of purchase) shall not be more or less than 10% of the Company s share price calculated by the trading day opening auction on the xetra System (or corresponding successor system) of the Frankfurt Stock Exchange. The current authorization to purchase Company shares, valid until October 27, 2007, will cease to be valid upon this new authorization coming into effect. b) The authorization may be exercised for all shares or in one or more installments. The authorization may be exercised for any legally permissible purpose as well as in pursuit of one or more of the purposes mentioned in paragraphs (c), (d), (e) and (f). Where it is used for one or more of the purposes mentioned in paragraphs (c), (d) or (e), the subscription rights of the stockholders will be excluded. c) The Board of Management is authorized to sell the Company shares acquired under this authorization other than via the stock exchange or through an offering to all stockholders, provided that the sale is made for cash and at a price that is not significantly below the stock market value of the Company s shares at the time of sale. This authorization is limited to a total of 10% of the Company s capital stock. The maximum 10% limit of the capital stock shall be reduced by the pro rata amount of the capital stock attributable to those shares which are issued while this authorization is still valid in connection with a capital increase subject to an exclusion of subscription rights pursuant to Article 186, para. 3, sentence 4 of the German Stock Corporation Act (Aktiengesetz). The maximum 10% limit of capital stock shall further be reduced by the pro rata amount of capital stock attributable to those shares which are issued for purposes of warrant bonds and/or convertible bonds to the extent the bonds are issued while the authorization is valid subject to the exclusion of subscription rights under analogous application of Article 186, para. 3, sentence 4 of the German Stock Corporation Act (Aktiengesetz).

d) The Board of Management is authorized to transfer to third parties the shares acquired under the above-described authorization, provided this is for the purpose of acquiring companies, parts of companies or interests in companies, or carrying out company mergers. 11 e) In connection with stock option programs (hereinafter Stock Compensation Programs ), the Board of Management is authorized to offer and transfer Company shares acquired under the above-described authorization to managerial and non-managerial employees of the Company and its subordinated affiliated companies in the manner described in detail in paragraph (h) below. f) The Board of Management is authorized to redeem the Company shares acquired under the above authorization without a further resolution of the Stockholders Meeting. g) The Board of Management may only exercise the authorizations in paragraphs (c) and (d) with approval of the Supervisory Board. Furthermore, the Supervisory Board may determine that actions of the Board of Management based on this resolution of this Stockholders Meeting may be undertaken only with its approval. h) Company shares acquired under this authorization may be used for two different types of Stock Compensation Programs from 2000-2002, namely Module 1 of the stock participation program (hereinafter spp ) as well as for the stock incentive program (hereinafter sip ). The essential conditions of these Stock Compensation Programs are as follows: Stock Options Each participant in either of the two Stock Compensation Programs is eligible to receive shares of the Company under the following terms and conditions. Any right to receive shares of the Company is hereinafter referred to as a Stock Option. Persons Eligible to Participate Persons eligible to participate in the spp were, in principle, all employees of the Company covered by collective bargaining agreements and managerial employees in contract levels 1 to 3, provided that, at the time of the commitment, they were permanently employed by the Company, not under notice, and, in the year previous to commitment, received a variable one-time compensation payment. The same applied also to employees of subordinated affiliated companies, in so far as such companies also offered an spp. Persons eligible to participate in the sip were all managerial employees in contract levels 4 and 5, provided that at the time of the commitment, they were permanently employed by the Company, not under notice, not members of a group leadership circle, and, in the year previous to commitments, received a variable one-time compensation payment. The same also applied to managerial employees with comparable functions in subordinate affiliated companies taking part in the program.

12 Bayer Annual Stockholders Meeting 2007 Agenda Conditions of Participation It was a condition of participation in the Stock Compensation Programs that the participant make a personal investment in shares of the Company (hereinafter, Investment Shares ). The maximum number of Investment Shares depended on the individual variable compensation component of each eligible participant and on the share price at the respective time of the commitment. For every ten (10) of his own Investment Shares, a participant in Module 1 of the spp received five (5) Stock Options on each one Company share. For every ten (10) of his own Investment Shares, a participant in the sip received ten (10) Stock Options on each one Company share. Term / Content of the Program Both Stock Compensation Programs from 2000 to 2002 (spp Module 1, sip) have a 10-year total term. The programs from 2003 and 2004 exclusively involve cash payments and are not covered by this resolution. The Employee Stock Compensation Programs from 2005 and 2006 are also not subject of the resolution. During the term of the program, each participant can receive further shares of the Company free of charge (hereinafter, Incentive Shares ) for every ten Investment Shares; under spp this is limited to a maximum of five Incentive Shares, under sip to a maximum of ten Incentive Shares. It is a condition of the foregoing that the participant s own Investment Shares must remain in his deposit account from the start of the program until the relevant distribution date. Under sip, the distribution of Incentive Shares is subject to a further condition. Incentive Shares for tranches established before 2003 are only granted if the performance of the shares of the Company (measured as total return) exceeds that of the reference index, the Dow Jones euro stoxx 50 sm (performance index). The performance of the share compared with the performance of the index is determined on the basis of the average prices over the ten trading days preceding the start of the program or the respective distribution date in the xetra Closing Auction of the Frankfurt Stock Exchange (or a corresponding successor system). For tranches established before 2003, not only the trading price of stock of the Company, but also dividend payments, measures concerning the stock capital, the value of subscription rights and other special rights are to be taken into account according to the same criteria as in the Dow Jones euro stoxx 50 sm (performance index). In connection with the spin-off of the lanxess subgroup, all currently running tranches of the Stock Option Programs have been adjusted to essentially offset the effects of dilution and loss of value resulting from the spin-off.

Stock options may be exercised after a two-year, six-year, and finally 10-year holding period, respectively. If the aforementioned conditions are met, participants are granted the following Incentive Shares at the times indicated for every ten deposited Investment Shares: 13 Distribution date SPP SIP at end of: [No. of Incentive Shares] [No. of Incentive Shares] 2 years 1 2 6 years 2 4 10 years 2 4 Incentive Shares are granted to all eligible participants free of charge. Non-transferability/Employee Status The stock options, i.e. the rights to receive Incentive Shares, are legally non-transferable. In principle, they can only be granted provided that the participant is employed by the Company or by a subordinated affiliated company of the Company on the distribution date and is not under notice. * * *

Bayer Annual Stockholders Meeting 2007 Agenda 14 Report of the Board of Management to the Annual Stockholders Meeting pursuant to Article 71, para. 1, no. 8 in conjunction with Article 186, para. 4, sentence 2 of the German Stock Corporation Act (Aktiengesetz) regarding Agenda Item 6 Article 71, para. 1, no. 8 of the German Stock Corporation Act (Aktiengesetz) allows stock corporations to purchase company shares representing up to 10% of the company s capital stock on the basis of an authorization from the stockholders. Agenda Item 6 contains a proposal to grant an appropriate authorization, limited to a term of 18 months. This will enable the Board of Management, in the interests of the Company and its stockholders, to purchase Company shares on the market representing up to 10% of the Company s current capital stock. The Company shares purchased by the Company can be resold on the stock market or through a public offering to all stockholders. These possibilities ensure that the principle of equality of treatment of stockholders is respected both in the purchase and the reissue of the shares. Furthermore, the Company may also sell the purchased Company shares off the market, without a public offering to all stockholders, provided that the price of the shares is not significantly lower than the trading price at the time of sale. This authorization makes use of the simplified exclusion of subscription rights allowed under Article 71, para. 1, no. 8 of the German Stock Corporation Act (Aktiengesetz) in analogous application of Article 186, para. 3, sentence 4 of the German Stock Corporation Act (Aktiengesetz). In particular, in the interests of the Company, it will be possible to offer shares of the Company to institutional investors domestically and abroad and to broaden the stockholder base. The requested authorization will allow the Company to respond quickly and flexibly to favorable stock market conditions. The interests of stockholders with regard to their assets and voting rights will be duly respected. The authorization based on Article 186, para. 3, sentence 4 of the German Stock Corporation Act (Aktiengesetz) to exclude subscription rights upon the sale of the Company s own shares, including any authorizations to issue new shares or convertible bonds and excluding subscription rights under Article 186, para. 3, sentence 4 of the German Stock Corporation Act (Aktiengesetz) is limited to a maximum of 10% of the Company s capital stock. For these purposes, the capital stock is defined as the capital stock existing at the time the authorization is first exercised. The maximum amount shall include otherwise issued shares subject to exclusion of subscription rights pursuant to or analogously pursuant to Article 186, para. 3, sentence 4 of the German Stock Corporation Act (Aktiengesetz). The aim of protecting stockholders from dilution is achieved by stipulating that the shares may only be sold for a price that is not significantly lower than the applicable trading price. The final selling price of the Company shares shall be determined immediately prior to the sale. The Board of Management shall endeavor taking into account current market circumstances to keep any discount on the trading price as low as possible. Interested stockholders can maintain their participation quota through purchases on the market at essentially identical conditions. The Company shall furthermore be allowed to offer its own shares for consideration in the context of company mergers or the acquisition of companies or parts of companies or interests in companies. The proposed authorization should give the Company the necessary scope to quickly and flexibly use any acquisition opportunities that arise. The proposed exclusion of subscription rights will allow this aim. When determining the valuation, the Board of Management will ensure that the interests of stockholders are duly protected. As a rule, it will base its assessment of the share value offered as consideration on the trading price of the Company shares. However, the intention is not to link the value rigidly to a trading price, particularly so as to prevent the outcome of negotiations, once achieved, from being jeopardized by fluctuations in the trading price. The Company is not planning any specific acquisitions at the present time.

Furthermore, under the provisions of paragraphs (e) and (h), the Company should be able to use its own Company shares for Stock Compensation Programs from 2000 to 2002. This option is not necessary for comparable Stock Compensation Programs from 2003 and 2004 because these programs are not geared to the issue of shares but exclusively to the payment in cash. The Employee Stock Compensation Programs launched in 2005 and 2006 are also not subject of the resolution. 15 The grant of stock options or subscription rights to employees and managerial employees entitling them to buy Company stock under certain conditions is one of the customary internationally recognized methods of compensation. This creates incentive to increase the value of the Company even more by outstanding work thereby promoting, in the interest of the stockholders and the Company, the performance of the Company s shares on the stock market also in comparison to other companies. At the same time, qualified employees and management will be attracted to the Bayer Group and also stay long-term with the Company. In view of this goal, the shares purchased for purposes of satisfying the Stock Compensation Programs of 2000-2002 in the event of sale may not be offered to the stockholders but only to the participants of the Stock Compensation Programs 2000-2002. All of the material terms of the relevant Stock Compensation Programs are set forth in the proposed resolution. Therefore, only the most important provisions are outlined below: The proposed authorization allows the Company to use its Company shares for satisfying claims of spp Module 1 and the sip. The Stock Compensation Programs using the Company s own shares as proposed for Stockholders Meeting authorization, have two or three main features which are of particular interest to the Company and its Stockholders: The first main feature relates to the respective holding periods by which managerial and non-managerial employees are bound to the Bayer Group for the medium to long term. These holding periods are longer than those stipulated by the Stock Option Programs of other companies, in some cases significantly so. The second main feature relates to the participant s personal investment. Only if eligible managerial and non-managerial employees invest on their own account and hence at their own risk in shares of the Company, can they participate in the Stock Compensation Programs as described above. This gives the Stock Compensation Programs particular significance and particular weight in a way that distinguishes them from many other stock compensation programs of other companies: managerial and non-managerial employees not only have the opportunity to share in the growing value of the Company through their own individual performance. They also like the stockholders participate in the risk by investing their own money. Finally, the third main feature relates to the further conditions for exercising the options. Two modules are available to participants in the spp. While Module 2, on which it is not necessary to pass a resolution here, has features of a typical employee stock compensation program and which under Article 71, para. 1, no. 2 of the German Stock Corporation Act (Aktiengesetz) uses the Company s own shares, acquired on the market by the Board of Management, Module 1 goes beyond Article 71, para. 1, no. 2 of the German Stock Corporation Act (Aktiengesetz) and is an innovative type of employee share ownership scheme which makes the granting of further shares in the Company conditional on the employee remaining with the Bayer Group and on making a personal investment.

16 Participants in the SIP only receive incentive shares for tranches up to and including 2002 if the performance of the shares of the Company (based on total return) exceeds that of Bayer Annual Stockholders Meeting 2007 Agenda the Dow Jones euro stoxx 50 sm (performance index) over the reference period. The managerial employees of the Bayer Group are therefore willing to measure their performance against that of other leading listed companies in the European economic area. The Stock Compensation Programs represent remuneration elements, which, in the interest of enhancing motivation, increase the amount of existing flexible remuneration components and should help enhance Bayer s corporate value in the long term. At the time the Incentive Shares are granted, the managerial employee has already earned this remuneration, i.e. the shares of the Company, through his own efforts so that the shares are issued to him free of charge. In 2006, 86,086 bonus shares under the SPP Module 1 incentive plan and 21,036 bonus shares under the sip incentive plan were issued to employees or managerial employees. Finally, the authorization allows the Company to redeem Company shares without a further resolution of the Stockholders Meeting. Such authorization is also common. It allows the Company to react appropriately and flexibly in any particular capital market situation. The Board of Management shall report on the utilization of the authorization at the next Stockholders Meeting. * * * 7. Approval of the Control Agreement between the Company and Bayer Schering GmbH The Board of Management and the Supervisory Board propose to approve the Control Agreement between the Company and Bayer Schering GmbH dated March 12, 2007. On March 12, 2007, the Company ( Bayer ), as controlling company, and Bayer Schering GmbH ( Bayer Schering ), as controlled company, entered into a Control Agreement. The Control Agreement has the following content: 1 Management (1) Bayer Schering shall subordinate the management of its company to Bayer. Bayer is thus entitled to instruct Bayer Schering s management with respect to the management of the Company. Bayer may not instruct Bayer Schering s management to amend, maintain or end this Agreement. (2) Pursuant to 1 (1) above, Bayer Schering s management is obligated to follow instructions of Bayer. (3) Instructions must be in writing. 2 Assumption of Loss (1) Bayer has a duty to assume every loss incurred during the term of the Agreement which, according to application of the provisions of Article 302, paras. 1 and 3 of the German Stock Corporation Act (Aktiengesetz), are not compensated for in that amounts are deducted from the other profit reserves as provided for in Article 272, para. 3 of the German Commercial Code (Handelsgesetzbuch), which were allocated there during the term of the Agreement.

(2) The duty to assume losses shall first begin in the fiscal year in which this Agreement takes effect according to 3 (2) below. 17 3 Effective Date and Term (1) This Agreement requires the approval of the Shareholders Meeting of Bayer Schering and the Stockholders Meeting of Bayer. (2) The Agreement shall become effective upon its entry into the commercial register at Bayer Schering s registered office. (3) The Agreement is entered into for an indefinite term. It may be terminated by giving six-months written notice to the end of any fiscal year of Bayer Schering. (4) The right of each party to terminate the Agreement for cause without notice shall remain unaffected. In particular, Bayer shall be entitled to terminate for cause if it no longer owns a majority interest in Bayer Schering or if a third party acquires a shareholding interest in Bayer Schering. Moreover, each party shall have the right to terminate the Agreement for cause on termination of the profit transfer agreement entered into between Bayer and Bayer Schering (formerly Dritte BV GmbH) on March 11, 2004. 4 Severability Should any provision of this Agreement, or any provision incorporated into this Agreement in the future, be or become invalid or unenforceable, or should there be a gap in this Agreement, then the validity of the other provisions of this Agreement shall not be affected thereby. The parties undertake to agree on a suitable provision in place of the invalid or inapplicable provision or to fill the gap which, to the extent legally permissible, comes as close as possible to what the parties wanted or, in light of the intent and purpose of this Agreement, would have wanted if they had considered the matter. The Control Agreement is described and explained in more detail in the Joint Agreement Report of the Board of Management of the Company and the Board of Management of Bayer Schering GmbH. 8. Appointment of Auditors The Supervisory Board proposes that PricewaterhouseCoopers Aktiengesellschaft, Wirtschaftsprüfungsgesellschaft, Essen, Germany be appointed as auditors for the 2007 fiscal year as well as for the audit review of the semi-annual financial report for the 2007 fiscal year. * * *

18 Bayer Annual Stockholders Meeting 2007 Agenda Upon giving notice of the Stockholders Meeting, in particular the documents listed below will be available for inspection by the Stockholders at the Company s business premises Building q 26 (Legal Department/Rechtsabteilung), Kaiser-Wilhelm-Allee, 51368 Leverkusen, Germany. Upon request of any Stockholder, copies of the same will be provided without undue delay and without charge. They may also be viewed on the internet under www.asm2007.bayer.com: Annual Financial Statements, Consolidated Financial Statements, the Management Reports for Bayer AG and the Bayer Group, report of the Supervisory Board, proposal by the Board of Management for distribution of the balance sheet profit (Agenda Item 1) Report of the Board of Management pursuant to Article 203, para. 2, sentence 2 in conjunction with Article 186, para. 4, sentence 2 of the German Stock Corporation Act (Aktiengesetz) (Agenda Item 5) Report of the Board of Management pursuant to Article 71, para. 1, no. 8 in conjunction with Article 186, para. 4, sentence 2 of the German Stock Corporation Act (Aktiengesetz) (Agenda Item 6) Control Agreement between the Company and Bayer Schering GmbH, Joint Agreement Report concerning the Control Agreement between the Company and Bayer Schering GmbH, Annual Financial Statements and Management Report of the Company as well as the Annual Financial Statements of Bayer Schering GmbH for the last 3 fiscal years respectively (Agenda Item 7) Stockholders Meeting Attendance and Total Number of Shares and Voting Rights Stockholders entitled to attend the Stockholders Meeting and exercise voting rights are those who by the end of the day on April 20, 2007 (24:00 hours cest) have registered with the Company at the following address: Bayer Aktiengesellschaft c/o Deutsche Bank AG General Meetings 60272 Frankfurt am Main Facsimile: +49 (0)69 / 910-86045 E-Mail: wp.hv@xchanging.com and have there provided certification issued by a depositary institution showing stock ownership in the Company at the beginning of the day on April 6, 2007 (00:00 hours cest). The registration and certification of stock ownership must be in text form and in the German or English language. Registration does not restrict stockholders in their ability to freely deal with their shares. As of the day of giving notice of this Annual Stockholders Meeting, the capital stock of the Company is divided into 764,341,920 bearer shares (non-par stock). All 764,341,920 non-par shares have voting rights. Proxy Stockholders may appoint an individual or a stockholders association as proxy to exercise their voting rights. The Company offers its stockholders the opportunity to appoint, before the Stockholders Meeting, a Company-nominated proxy who is bound by instructions of the stockholders.

In order to appoint Company-nominated proxies, stockholders need an admission ticket to the Stockholders Meeting. To ensure that the admission ticket is received in good time, stockholders should place their order with the depositary institutions as early as possible. 19 If Company-nominated proxies are appointed, they must be given instructions on exercising voting rights. Without such instructions the authorization is invalid. The proxies are obligated to vote as instructed. Authorization of and instructions to the Company-nominated proxies may be given in writing or alternatively in a manner specified by the Company, electronically via the internet. Detailed information on authorizing and instructing Company-nominated proxies can be found on the admission ticket to the Stockholders Meeting. This information may also be viewed on the internet at www.asm2007.bayer.com. Partial Broadcast of the Stockholders Meeting on the Internet All stockholders of the Company as well as the interested public may view the speech given by the chairman of the Board of Management at the Stockholders Meeting on April 27, 2007 at approximately 10:15 hours live on the Internet at www.asm2007.bayer.com. There will be no further picture and sound broadcast of the Stockholders Meeting. Stockholder Counter-Motions and Election Nominations Counter-motions or election nominations submitted by stockholders regarding specific items of the Agenda must be submitted exclusively to the following address: Bayer Aktiengesellschaft Gebäude q 26 (Legal Department/Rechtsabteilung) Kaiser-Wilhelm-Allee 51368 Leverkusen, Germany Facsimile: + 49 (0) 214 / 30-56524 Counter-motions or election nominations submitted by stockholders that are received by the end of the day on April 12, 2007 (24:00 hours cest) at the above address will be published promptly on the internet at www.asm2007.bayer.com. Counter-motions or nominations for election submitted by stockholders to a different address or received late will not be considered. Leverkusen, March 2007 Bayer Aktiengesellschaft The Board of Management This notice is a convenience translation. For the legally binding document, please refer to the original German version which is published on the internet under www.ebundesanzeiger.de

20 Bayer Annual Stockholders Meeting 2007 Chairman s Letter Schering acquisition crowns a strong year We look back with satisfaction on an eventful and successful 2006 a landmark year for Bayer, both strategically and operationally. Our employees around the world have good reason to be proud of last year s accomplishments: By acquiring Schering, Berlin, Germany, in what was the largest corporate transaction in Bayer s history, we further optimized our product portfolio and successfully continued the Group s realignment. We increased sales considerably, and operating performance (ebit and ebitda before special items) was at an all-time high. In China, we inaugurated production facilities representing Bayer s largest-ever capital expenditure project outside Germany. The year s outstanding event was our acquisition of Schering AG for approximately 17 billion. The Schering business ideally complements our existing pharmaceutical activities, and the new Bayer Schering Pharma AG is among the world s leading suppliers of specialty pharmaceuticals. Our attractive product portfolio and well-stocked research and development pipeline offer excellent prospects for future success. We are convinced that Bayer Schering Pharma will strengthen our HealthCare business and with it the entire Bayer Group for the long term. The integration process is proceeding as planned. We are well on track to achieve the communicated synergy goal of 700 million annually by 2009. The Schering acquisition is founded on a balanced financing package of cash, borrowings and equity transactions. In addition to the mandatory convertible bond issued in March, we successfully placed 34 million new Bayer shares, worth 1.2 billion, in July. We continued to focus our portfolio by divesting the diagnostics business and the subsidiaries H.C. Starck and Wolff Walsrode. The substantial proceeds of these transactions will help to reduce debt. We also scored considerable success in our business operations: Sales rose 17 percent to 29 billion. Adjusted for currency fluctuations, the effect of the Schering acquisition and other portfolio changes, growth amounted to 5 percent. ebitda before special items climbed by 21 percent from the prior year, to 5.6 billion. That gave us an underlying ebitda margin of 19.3 percent, in line with our earnings guidance for 2006. ebit before special items moved ahead 14 percent to a record high of 3.5 billion, while ebit after special items advanced by 10 percent to 2.8 billion.

Of course we want you, our stockholders, to benefit from our economic success. We therefore propose to raise the dividend for 2006 by 5 percent to 1.00 per share. 21 Our good business performance is also reflected in the value of Bayer stock. The share price rose above 40 in 2006 for the first time in five years. Last year alone, our market capitalization grew by 20 percent to more than 31 billion. We will do all we can to ensure that this encouraging performance continues in the future. Our success greatly depends on the skills and the dedication of more than 100,000 Bayer employees throughout the world, whom I would expressly like to thank on behalf of the entire Board of Management. Without their support, we could not have accomplished so much over the past year. We continue to rely on their high commitment and motivation. Now let us look at the performance of the subgroups. Sales of Bayer HealthCare rose considerably, thanks to the Schering acquisition and above-market growth in all divisions. We successfully introduced new products to the market and boosted the potential of existing products through expanded registrations. Werner Wenning

22 Including Schering s sales prior to the acquisition date as well gave Bayer Schering Pharma total pro forma sales of more than 10 billion for 2006 a very substantial Bayer Annual Stockholders Meeting 2007 Chairman s Letter revenue base. Together with the Consumer Care, Diabetes Care and Animal Health divisions, which all hold leading international positions and also performed impressively last year, HealthCare will account for nearly 50 percent of Bayer Group sales in the future. As you can see, these activities are growing quickly and profitably. Bayer CropScience stood up comparatively well to difficult market conditions in 2006. Our conventional crop protection business in particular had to contend with adverse weather conditions, heightening competition from generic products and the increasing cultivation of genetically modified crops. The company is implementing a new cost structure program to sustainably improve earnings. Innovation and growth prospects at Bayer CropScience are closely linked to the major opportunities presented by plant biotechnology. I for one believe that biotechnology is one of the most important technologies of the 21st century and it will be of fundamental value to Bayer CropScience in mastering future challenges. At Bayer MaterialScience, sales again developed well and earnings almost matched the high level of the previous year. Margins were squeezed primarily by the sharp rise in petrochemical feedstock and energy costs, along with unplanned production interruptions. In polycarbonates we achieved a special milestone in 2006, becoming the world s number one supplier. This means Bayer is now the global leader in both polyurethanes and polycarbonates. In China we are implementing our biggest capital expenditure project to date outside Germany, with a volume of approximately us$ 1.8 billion through 2009. By building the facilities at the Bayer Integrated Site in Shanghai, Bayer MaterialScience has laid the foundation for further growth in the highly promising Asia-Pacific region, and China in particular. We remain confident for 2007 and aim to boost Group sales by more than 10 percent. Adjusted for portfolio and currency effects, business should expand by about 5 percent. We plan to increase underlying ebitda by more than 10 percent as well, and also slightly improve our underlying ebitda margin. Yet apart from the kind of corporate success that can be expressed in terms of sales and earnings, another aspect is very important to me. Our products are of great value to humankind and contribute substantially to improving the quality of life. They extend the health of people and animals, help ensure the quality and adequacy of food supplies, make cars safer, improve home living and contribute to climate protection. Thus the achievements of our employees are in evidence everywhere.

Our products save lives, improve conditions and are indispensable to many people. That is enormously motivating and a source of great satisfaction and pride. 23 In 2006 we also ran more than 300 activities that testify to our corporate social responsibility, ranging from training for young environmentalists around the world through programs for school students and talented scientists to the development of health care plans and projects to ease social hardship. Bayer is mindful of its social responsibilities and is particularly committed to the principle of sustainability. We are a strong advocate of responsible corporate governance and business ethics, and we require strict observance of our corporate compliance program. This year again, we want to live up to our mission statement Bayer: Science For A Better Life. And I m already sure we can succeed not least because we can count on an exceptionally dedicated workforce. An example is the response to our new Triple-i initiative (inspiration, ideas, innovation), which is helping to strengthen the innovation culture throughout the Bayer Group. Employees around the world had already submitted more than 1,900 business ideas by the end of 2006. Many of these proposals show how Bayer could help to solve problems in the future by developing new lines of business that are in keeping with our mission statement. We believe one of our most important tasks is not just to ensure a strong current performance, but at the same time to create the conditions for long-term success. Last year we took a major stride in that direction in the interest of the company, our employees and, of course, our stockholders. In closing, I would like to thank you on behalf of the Board of Management for your trust and your support. We will do everything in our power to live up to the expectations placed in us for 2007. Sincerely, Werner Wenning Chairman of the Board of Management of Bayer AG

24 Bayer Annual Stockholders Meeting 2007 Investor Information Acquisition of Schering gives Bayer stock further impetus Bayer stock continued to appreciate in 2006, posting an overall performance of 18.3 percent. Investor interest focused on the acquisition of Schering. Dividend rises to 1.00 per share. 2006: a volatile stock market year ends on a positive note The German equity market proved volatile in fiscal 2006. The dax initially continued on the previous year s upward path. However, concern about inflation and interest rates in the United States triggered a global market downtrend in May and June, with substantial falls in some stocks. Sound corporate profits and buoyant mergers and acquisitions activity revived investor confidence at the start of the second half and ushered in a new rally. The dax ended the year up 22.0 percent at 6,597 points. Performance of Bayer stock exceeds 18 percent Bayer stock again developed very well, its price gaining 15.2 percent on the year. Including the dividend of 0.95 per share paid in 2006, our stock achieved a performance of 18.3 percent. This was only just below the dax s performance but slightly above the Dow Jones euro stoxx 50 sm index, in which Bayer is also included. During the year the share price was driven mainly by factors relating to our acquisition of Schering, Berlin, Germany. The announcement on March 23, 2006 of our intention to acquire Schering triggered a period of turbulent trading in Bayer stock, with a very high turnover at times. The tide turned in mid-june 2006, when it became increasingly clear that our public takeover offer would succeed, and Bayer shares went on from there to gain over 30 percent by year-end. A 1.2 billion capital increase as part of the financing of this acquisition raised the number of shares in issue by 34 million to 764.34 million. Market capitalization increased by a total of 5.3 billion (+20.5 percent) on the year, to 31.1 billion. This capital increase and the effect of the 2.3 billion mandatory convertible bond launched in April 2006 have to be taken into account in calculating earnings per share for fiscal 2006. In computing earnings per share, ordinary shares to be issued when the conversion rights from this bond issue are exercised have to be counted together with already issued shares, so basic and diluted earnings per share are identical.

25 Performance of Bayer Stock in 2006 (indexed; 100 = closing price on December 31, 2005) 125 120 115 + 22.0 % + 18.3 % + 18.0 % 110 105 100 95 90 85 Jan 06 Feb 06 Mar 06 Apr 06 May 06 June 06 July 06 Aug 06 Sept 06 Oct 06 Nov 06 Dec 06 Bayer dax euro stoxx 50 sm

26 Bayer Annual Stockholders Meeting 2007 Investor Information Bayer Stock Data 2005 2006 Earnings per share 2.19 2.22 Core earnings per share 1 2.84 3.24 Cash flow per share 4.26 5.12 Equity per share 15.28 16.81 Dividend per share 0.95 1.00 Year-end price 2 35.29 40.66 High for the year 2 35.92 40.92 Low for the year 2 22.02 30.56 Total dividend payment million 694 764 Shares entitled to the dividend (Dec. 31) million 730.34 764.34 Market capitalization (Dec. 31) billion 25.8 31.1 Average daily trading volume million 4.1 5.6 Price/earnings ratio 2 16.1 18.3 Price/cash flow ratio 2 8.3 7.9 Dividend yield % 2.7 2.5 1 For details on the calculation of core earnings per share, see page 29. XETRA closing prices; Source: Bloomberg Proposed dividend of 1.00 per share The Board of Management and Supervisory Board will propose to the Annual Stockholders Meeting that that the dividend be raised by 5.3 percent to 1.00 per share. The higher per-share amount and the larger number of shares due to the capital increase boost the payout by 10.1 percent to 764 million. The dividend yield calculated on the year-end price amounts to 2.5 percent. Despite the substantial expenditures for the Schering acquisition, this dividend is intended to ensure that stockholders participate in the success Bayer experienced in 2006 and demonstrate the confidence of the Board of Management and Supervisory Board in the Group s future development. Debt issues support financing of Schering acquisition Bayer s borrowings generally take the form of bond issues under the company s European Medium Term Notes (emtn) program. The larger Bayer AG bonds launched under this program are included in the major bond indices in light of their benchmark issue volumes and their liquidity. In addition, the Group issues innovative, separately documented debenture types and u.s. bonds under Rule 144a. In 2006 Bayer offered investors several attractive issues. As part of the financing package for the Schering acquisition, a 2.3 billion mandatory convertible bond was issued by Bayer Capital Corp. in April 2006 and placed with institutional investors. This subordinated bond, which is guaranteed by Bayer AG, has a coupon of 6.625 %. It was the largest mandatory convertible bond placement in Europe to date. Investors may convert the bond into shares of Bayer AG during the term of the bond, which runs until June 2009. If they have not done so by then, the bond will automatically convert into shares. Because of its structure, the rating agencies Moody s and Standard & Poor s treat the mandatory convertible bond entirely as equity and do not regard it as debt for credit rating purposes.

27 Dividends Total dividend payment ( million) 1,000 1,022 900 949 800 764 747 700 710 657 657 694 600 500 400 402 300 365 200 100 Dividend per share ( ) 2.0 1.5 1.0 0.5 0.97 1.02 1.30 1.40 0.90 0.90 0.50 0.55 0.95 1.00 0.0 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

28 Bayer Annual Stockholders Meeting 2007 Investor Information In May 2006 Bayer AG issued three bonds under its emtn program, again to help finance the acquisition of Schering. The first is a three-year floating rate note in a nominal amount of 1.6 billion which bears interest at 0.225 percent above the 3-month Euribor rate. The second is a 1 billion issue with a seven-year term and a coupon of 4.5 percent. The third, a sterling (gbp) issue, has a coupon of 5.625 percent and a maturity of 13 years. In December 2006 Bayer utilized the very favorable capital market conditions to increase this issue by gbp 100 million to a total of gbp 350 million, giving Bayer s first-ever sterling bond benchmark volume and appealing to investors in a further currency zone. The issue was fully swapped into euros. The hybrid bond in the nominal amount of 1.3 billion issued in 2005 was reclassified by Standard & Poor s as a result of a change to that agency s rating methodology. In computing debt indicators, s & p now treats 50 percent of this issue as equity and 50 percent as debt. Moody s continues to treat 75 percent as equity. www.investor.bayer.com Investor relations activities focus on the acquisition Investors interest in 2006 centered on the acquisition of Schering. Bayer s management and investor relations team met with analysts and investors at roadshows and investor conferences on nearly 60 days. The principal topics addressed at these meetings, apart from the strategic reasons for acquiring Schering, were the late-stage projects in Bayer s pharmaceuticals development pipeline, the restructuring of CropScience, trends on the polymers markets and the impact of the Schering acquisition on Bayer s credit rating. An innovative conference format entitled Meet Management, which was introduced in May, proved especially attractive. Representatives of the investment community were invited to Leverkusen for intensive small-group discussions with members of the management boards of our holding company and subgroups about the performance of the Bayer Group and its subsidiaries. We also set up a hotline on the Schering acquisition to give private investors full and timely information on matters relating to the tender of their shares. The Internet was used as an additional information channel, particularly to reach individual stockholders. Wherever practicable, all conference calls and meetings are streamed live on the Internet to ensure their accessibility to all interested parties.

Calculation of core earnings per share Earnings per share according to ifrs are affected by the purchase price allocation and other special factors. To enhance comparability, we also determine core net income from continuing operations after elimination of the amortization of intangible assets, asset write-downs (including any impairment losses), special items in ebitda and extraordinary factors affecting income from investments in affiliated companies (such as divestment gains or write-downs), including the related tax effects. 29 Adjusted core net income, core earnings per share and core ebit are not defined in the International Financial Reporting Standards. Therefore they should be regarded as supplementary information rather than stand-alone indicators. Calculation of Core EBIT and Core Earnings per Share 2005 2006 million EBIT as per income statement 2,514 2,762 Amortization and write-downs of intangible assets 550 734 Write-downs of property, plant and equipment 55 107 Special items (other than write-downs) 480 909 Core EBIT 3,599 4,512 Non-operating result (as per income statement) (602) (782) Extraordinary income/loss from investments in affiliated companies - (236) Income taxes (as per income statement) (538) (454) Tax adjustment (386) (531) Income after taxes attributable to minority interest (as per income statement) 2 (12) Core net income from continuing operations 2,075 2,497 Financing expenses for the mandatory convertible bond, net of tax effects - 72 Adjusted core net income 2,075 2,569 Shares Weighted average number of issued ordinary shares* 730,341,920 746,456,988 Potential shares to be issued upon conversion of the mandatory convertible bond - 45,300,595 Adjusted weighted average total number of issued and potential ordinary shares 730,341,920 791,757,583 Core earnings per share from continuing operations ( ) 2.84 3.24 * including new shares from the capital increase on a pro-rated basis

30 Bayer Annual Stockholders Meeting 2007 Highlights 2006/2007 The Extraordinary Stockholders Meeting of Bayer Schering Pharma AG held in Berlin in January 2007 (photo) resolved to effect a squeeze-out of the remaining minority stockholders. Bayer Schering Pharma off to a successful start Berlin/Leverkusen For Bayer, the outstanding event of 2006 was undoubtedly the acquisition of Schering AG, Berlin, Germany the largest transaction in the Group s history. It was on March 23 that Bayer first announced its intention to acquire Schering; on April 13, the official offer document was submitted. By September 8, Bayer controlled over 95 percent of Schering AG stock. On September 13, at an Extraordinary Stockholders Meeting in Berlin, Schering s stockholders consented to the domination and profit and loss transfer agreement with Bayer subsidiary Dritte bv GmbH. On October 27, the agreement came into force upon being entered in the commercial register. On December 29, Schering AG was officially renamed Bayer Schering Pharma AG. Then in January 2007, an Extraordinary Stockholders Meeting of Bayer Schering Pharma AG was held in Berlin, at which the decision was made to effect a squeeze-out of the company s remaining minority stockholders. Bayer Schering Pharma remains headquartered in Berlin and will be managed together with Bayer s current pharmaceutical business as a division of the Bayer HealthCare subgroup. Outlining his view of the new company s future, Bayer AG Management Board Chairman Werner Wenning says: Bayer Schering Pharma is set to become a strong, effective, world-class company that will take its place among the top ten international suppliers of specialty pharmaceuticals.

New formulating technology from Bayer CropScience Monheim o-teq is the name of an innovative formulation concept developed by Bayer CropScience to enhance the effectiveness of systemic insecticides. Products such as Proteus, Biscaya or Confidor o-teq based on this technology display outstanding biological performance. They are extremely reliable and their effectiveness is virtually unimpaired by changes in weather conditions during or after application. The new formulation underlines Bayer CropScience s claim to technological leadership. Bayer und UNEP reinforce partnership Leverkusen In March 2006, Bayer and the United Nations Environment Programme (unep) endorsed their collaboration in global youth environmental activities. Bayer Management Board Chairman Werner Wenning and unep Executive Director Prof. Klaus Töpfer said they were pleased with the outcome of their first two years of partnership in the area of youth and the environment. Together with unep we have initiated a large number of projects all over the world. In this way we are making a lasting contribution to youth environmental education, said Wenning. Since the partnership began in 2004, Bayer has helped the United Nations Environment Programme to develop youth networks in Asia, Latin America and Africa, and to establish a global environmental summit meeting. Bayer not only provides funding of 1 million annually for the joint activities, but also implements the individual projects in cooperation with unep. initiated and funded an Endowed Chair for Intellectual Property Rights at the elite Tongji University in Shanghai, China. The company has also announced that it will fund a Chair for Sustainable Development there. Start-up company for luminescent film Leverkusen In April 2006, Bayer established a new company, Lyttron Technology GmbH to produce electroluminescent film. Lyttron, a wholly owned subsidiary of Bayer MaterialScience, develops, manufactures and markets luminescent film for applications such as the automotive industry and lifestyle products. The entire start-up capital of about 24.5 million is being invested in film production and the construction of a laboratory plant in the Leverkusen Chemical Park. Lyttron began operating with a staff of 25 finance, marketing, production and administration experts. By 2012 the company expects to employ more than 150 people. The establishment of Lyttron is consistent with Bayer MaterialScience s pursuit of its innovation strategy. Bayer divests interest in GE Bayer Silicones Leverkusen Bayer sold its 49.9 percent interest in GE Bayer Silicones to the joint venture partner General Electric. The proceeds of the sale totaled 475 million before taxes. The transaction improved Bayer s non-operating result for 2006 by 236 million. 31 As part of the global sponsorship program for scientific and social projects, Bayer has

32 Bayer Annual Stockholders Meeting 2007 Highlights 2006/2007 Icon Genetics researches plants that can be used to manufacture pharmaceuticals. Here, Dr. Sylvestre Marillonnet immerses tobacco plants in a bacterial solution. Some 140 journalists came to Leverkusen in October 2006 to attend the press forum entitled Bayer s Perspective on Innovation. Producing antibodies in plants Halle/Ghent In September 2006, Icon Genetics GmbH, a subsidiary of Bayer Innovation GmbH, and Bayer BioScience NV, a subsidiary of Bayer CropScience, published the results of research into new-generation expression technologies for plants. These technologies serve to synthesize proteins from genetic information. The scientists developed a process for high-yield production of monoclonal antibodies. The process is suitable for research purposes, industrial scale-up and the production of antibodies for medical uses for example, in the diagnosis and treatment of cancer. Icon Genetics is engaged in developing processes for the biotechnological production of therapeutic proteins and other high-value products in plants. Bayer plans to acquire Ure-Tech Group of Taiwan Leverkusen Bayer MaterialScience announced in October 2006 that it plans to acquire Taiwan s Ure-Tech Group, the largest thermoplastic polyurethane (tpu) producer in the Asia-Pacific region. The acquisition would make Bayer Material- Science the world s largest supplier of products and solutions in the field of tpu resins and films. Closing of the deal is expected for the second quarter of 2007. Sector s largest R&D budget Leverkusen The Bayer Group aims to further strengthen innovation as one of the most important goals of its corporate strategy. Research is key to success. We must exploit our scientific potential to the full and consistently translate research findings into new products, Bayer AG Management Board Chairman Werner Wenning said in October before an audience of some 140 media representatives from 16 countries at the press forum Bayer s Perspective on Innovation 2006 in Leverkusen. In 2006 Bayer invested 1.9 billion in research and development not including Schering. That is more than any other chemicals and health care company in Germany, said Wenning. The Schering acquisition strengthens Bayer s pharmaceutical research in particular, with Germany remaining Bayer s principal research location. With the integration of the acquired business, Bayer s research and development expenditures in 2006 increased to about 2.3 billion, more than 65 percent of which was spent in Germany.

33 Bayer HealthCare has strengthened its business in prescription-free medications such as Aspirin by aquiring the otc activities of the Topsun Group. Rivaroxaban, a new substance to inhibit blood coagulation, was developed by Dr. Susanne Röhrig and her colleagues in Wuppertal, Germany. Bayer HealthCare steps up OTC presence in China Leverkusen/Shanghai In October 2006, Bayer HealthCare agreed to be acquire the over-the-counter (otc) cough and cold products portfolio of the Chinese-based TopSun Group for approximately 106 million, plus contingent payments totaling up to 19 million that are subject to fulfillment of certain performance criteria. This acquisition will substantially increase Bayer HealthCare s presence in China, one of the fastest growing otc markets in the world, and is intended to enhance the company s competitiveness in the Chinese otc market. Closing of the transaction is expected for the second half of 2007. Phase III study for rivaroxaban under way Leverkusen Based on positive research findings so far, a phase III study program for rivaroxaban was launched at the end of 2006. Phase II clinical trial results highlighted the potential of a simple, oncedaily dosing regimen of the novel, oral anticoagulant rivaroxaban. In this trial, rivaroxaban demonstrated that it may have similar safety and efficacy to the current standard for the prevention of venous thromboembolism (vte). Present published results also show that rivaroxaban offers predictable anticoagulation across a wide range of parameters. In addition, data show that rivaroxaban does not interact with a wide variety of drugs that are commonly given concomitantly with an anticoagulant. Rivaroxaban is being jointly developed by Bayer HealthCare and Ortho- McNeil Pharmaceuticals Inc., a subsidiary of Johnson & Johnson. Advent and Carlyle acquire H.C. Starck Leverkusen In November 2006, Bayer announced the sale of its subsidiary H.C. Starck to a consortium formed by financial investors Advent International and The Carlyle Group for approximately 1.2 billion. The proceeds like those of the divestment of Wolff Walsrode (see page 35) are to be used to reduce net debt associated with the acquisition of Schering AG. Advent and Carlyle said they intend to continue developing the H.C. Starck business with the aim of positioning the company for an initial public offering in three to five years. Closing of the transaction took place on February 1, 2007. H.C. Starck, headquartered in Goslar in northern Germany, manufactures metal and ceramic powders, specialty chemicals, and parts made from advanced ceramics and refractory metals. The company belonged to the Bayer MaterialScience subgroup.

34 Bayer Annual Stockholders Meeting 2007 Highlights 2006/2007 In 2006 Bayer MaterialScience commissioned several new production facilities in the Shanghai Chemical Industry Park. The plants were planned and built by Bayer Technology Services. Bayer to invest US$ 1.8 billion in Shanghai through 2009 Shanghai At a ceremony in September 2006 attended by 500 guests from politics, industry and the media, Bayer inaugurated the new production facilities of the Bayer MaterialScience subgroup in Shanghai. China is of central importance to Bayer in the Asia / Pacific region both as a production base and for our business strategy, explained Bayer AG Management Board Chairman Werner Wenning. Construction of the facilities at the Shanghai Chemical Industry Park represents a total capital expenditure volume of about us$ 1.8 billion through 2009, making it Bayer s biggest-ever project outside of Germany. The new plants that have come on stream add substantially to the production capacities of Bayer MaterialScience. The facilities already operating at the site are now joined by a world-scale polycarbonate production unit whose initial capacity of 100,000 tons per year is scheduled to increase to 200,000 tons by 2008. This facility is intended primarily for supplying customers in the region. The first polyurethane facility on Bayer s site, a splitter for crude mdi (diphenylmethane diisocyanate), has a capacity of 80,000 tons per year. A large-scale mdi production facility with a capacity of 350,000 tons per year, due on stream in 2008, is expected to be the largest of its kind in the world. Inaugurated at the same time was a production unit for hdi (hexamethylene diisocyanate) with an initial capacity of 30,000 tons per year. Bayer MaterialScience announced in February 2007 that the capacity of a planned facility for producing tdi (toluene diisocyanate) in Shanghai is to be raised from 160,000 to 300,000 tons a year.

Acquisitions strengthen U.S. cottonseed business Monheim In December 2006, Bayer CropScience purchased the assets of California Planting Cotton Seed Distributors (cpcsd), Bakersfield, California, and, separately, those of Reliance Genetics llc, Harlingen, Texas, for a total of about us$ 20 million. These transactions advance the company s strategy in expanding its cotton seed business and accessing new markets. Acquisition of the seed production and processing capabilities of cpcsd now gives Bayer CropScience a dedicated facility in the western United States. Reliance Genetics runs a specialized cotton breeding program that ideally complements Bayer CropScience s current FiberMax product offering. Acquiring the Reliance assets enables Bayer CropScience to introduce additional varieties into its portfolio. Dow to acquire Wolff Walsrode from Bayer Midland/Leverkusen The Dow Chemical Company and the Bayer Group announced in December 2006 that they have reached agreement for Dow to acquire Bayer subsidiary Wolff Walsrode, which mainly manufactures products based on cellulose chemistry. The transaction is expected to close in the second quarter of 2007, subject to regulatory approval. The proceeds will be used to reduce financial debt. Sale of diagnostics business completed Leverkusen In January 2007, the Diagnostics Division of Bayer HealthCare was sold to Siemens AG, Munich, Germany, for 4.3 billion. For Bayer the after-tax proceeds of the divestment were about 3.6 billion, which is to be used to reduce financial debt. The divestment is in line with Bayer HealthCare s strategy of focusing on pharmaceuticals for both humans and animals, and products that can be promoted directly to patients. The consumer-influenced Diabetes Care Division is not affected by the transaction, nor is Schering s contrast agents (diagnostic imaging) business. Combating Climate Change initiative signed Brüssel Bayer and 16 other international companies are original signatories of the global climate protection initiative 3c: Combating Climate Change, presented in Brussels in January 2007. With their specialist knowledge and experience, the participating companies want to help develop a successful global climate protection policy for the period following the expiration of the Kyoto Protocol in 2012. Actively addressing the need to protect the earth s climate forms a major part of Bayer s sustainability strategy, which is why the company co-founded the 3c initiative. Bayer hopes that as many companies as possible will sign up. To tackle the problem of climate change, the 3c initiative aims to support the political community in establishing a global framework for emissions reduction that would ensure all companies throughout the world can compete on fair terms. A long-term goal of the initiative is to fully exploit the potential for technological innovation between now and the year 2100. Underscoring its lasting commitment to climate protection, Bayer has exceeded the targets set by the Kyoto Protocol for reductions in direct greenhouse gas emissions, partly through process innovations. An example of the latter is a method already introduced in Germany and China by which the chlorine needed for plastics production can be manufactured using 30 percent less energy than before. 35

36 Bayer Annual Stockholders Meeting 2007 Awards 2006/2007 In 2006 Bayer continued to be acknowledged for its expertise across a broad range of activities, sustaining its positive image at an international level. This was evidenced by numerous accolades the company received during the year. Says Management Board Chairman Werner Wenning: The recognition bestowed upon us by external experts testifies to our success in applying our knowledge and innovative capability responsibly in line with our mission statement Bayer: Science For A Better Life. It shows the fascination of Bayer. The following are among the most significant of these awards. Company and employees Bayer became the first company with global headquarters outside the u.s., and also the first chemical company, to receive the Ron Brown Award for Corporate Leadership. This is the only u.s. presidential award honoring companies for their activities in the social sector. Bayer received this distinction for its Making Science Make Sense program, an initiative launched ten years ago that advances science literacy among school students. In China, Bayer was recognized as one of the top employers for 2007 in the Shanghai region. Bayer and 37 other local and multinational companies were honored by the Corporate Research Foundation for their best-in-class practices in the human resources field, including unique talent attraction and retention programs. The company s high reputation around the world was also reflected in the outcomes of several opinion surveys. In Indonesia, Bayer is among the most admired companies according to a survey by the magazine BusinessWeek. In Brazil, Bayer CropScience Ltda. was listed as the best crop protection enterprise in Brazil in Exame magazine s Agribusiness Yearbook. In Canada, Bayer CropScience was ranked among the 100 best employers for the third year in succession. In the United States, Bayer Corporation was recognized as one of the 100 best companies in the nation for working mothers. And a survey in Germany commissioned by the business magazine WirtschaftsWoche showed that the country s managers consider Bayer the most fascinating health care and chemicals company. Other honors were accorded to Bayer for its vocational training activities. German Vice Chancellor Franz Müntefering awarded Bayer the prize entitled Shaping Employment Companies Demonstrate Responsibility in the category Perspectives for Young People in recognition of the company s special program that prepares socially and educationally disadvantaged young people for vocational training courses.

37 Total E-Quality: Bayer equal opportunity compliance specialist Dagmar Diergarten holds the certificate with Wolfgang Schenk, also of Human Resources. Best in Class: In 2006 Bayer was again honored for its endeavors in the field of climate protection. The picture shows a plant in the Krefeld Chemical Park. German school students consider Bayer to be one of the country s best employers, according to the Student Barometer survey, carried out by the Berlin research institute trendence for the weekly newspaper Die Zeit, in which Bayer received by far the best ranking among chemicals and health care companies. Also in Germany, Bayer trainee Oliver Polch achieved one of the highest scores in the 2006 final examinations of the Chamber of Industry and Commerce for plant electronics technicians. As a result he was among those honored at a ceremony in Berlin in the presence of Chancellor Angela Merkel. In 2006 Bayer AG received the Total E-Quality award for the fourth time in recognition of its commitment to equality of opportunity in the workplace. Announcing the honor, the jury of Total E-Quality Deutschland said that over a period of more than ten years Bayer s joint committee on equal opportunity had initiated numerous activities in this area, including promoting equal access to employment and participating in personnel development measures. Sustainability As in the previous year, Bayer received the title Best in Class in 2006 in recognition of world-leading achievements in the field of climate protection. Bayer therefore remains a component of the Climate Leadership Index, the first global stock index for climate protection, where in 2006 it was rated the best company in the chemicals sector. Bayer also continues to be included in the Dow Jones Sustainability World Index (djsi World) and the European Dow Jones stoxx Sustainability Index (djsi stoxx). Bayer is held to be among the most socially responsible companies in China, according to an award the company received from the Fair Labor Association, an international non-profit organization, at the Global Corporate Social Responsibility Forum. This prize recognizes Bayer s role as a responsible corporate citizen in China. It was conferred in recognition of the company s long-standing commitment to public health, environmental protection and recreational sports and its employees participation in neighborhood and community services. The Brazilian trade journal Meio Ambiente Industrial presented Bayer CropScience in Brazil with the Sustainable Enterprise Award. This prize honors companies for endeavors to improve the environment and quality of life in Brazil. Bayer MaterialScience s New Martinsville facility in West Virginia, United States, received Star status under the Voluntary Protection Programs (vpp) of the u.s. Department of Labor Occupational Safety and Health Administration (osha). These programs recognize and partner with businesses and sites that show excellence in occupational safety and health. The plant received accolades for its three-year Total Case Incidence Rate (tcir), which was 71 percent less than the industry average for 2004. The number of work-

38 Bayer Annual Stockholders Meeting 2007 Awards 2006/2007 Best communications activities (from left): Heiner Springer, Head of Bayer AG Communications, with Peter Driessen and jury spokesman Rolf G. Lehmann Best Sustainable Development Report (from left): Dieter Ulrich of the German Chamber of Auditors, with Ursula Mathar and Michael Schade from Bayer days lost through industrial injuries was also substantially below the average. Communications Bayer AG s communications work was honored at the 18th Corporate Media Awards 2006, presented by the Medienreport publishing house in Munich, with the highest accolade, the Master of Communication 2006 Member of the European Masterclass. The company also received four prizes for achievements in the field of electronic communications. The Bayer homepage and the online version of the Sustainable Development Report were honored with the Award of Master in the Best Internet Solutions segment, while the Group website as a whole won a special prize in the same category. Bayer s corporate image film Commitment For A Better Life, which depicts the Group s commitment to society and the environment, was commended by the jury as an excellent communications solution. The German Environmental Reporting Award 2006 was presented to Bayer AG in 2006 for the country s best Sustainable Development Report. The Bayer publication scored very highly with respect to almost all of the assessment criteria. Bayer also garnered several of the German Comprix Awards: the winner in the corporate advertising category was the Bayer: Science For A Better Life campaign, while two gold medals went to Bayer HealthCare s Levitra team, with the When? Now! advertisements taking first place in the consumer print campaigns category. Bayer Vital Consumer Care was honored for its Bepanthen tv commercial. And Bayer HealthCare s online soap opera about relationship problems came top in the digital interactive media category. This first online soap in Germany also received the prestigious pr Report Award in the category Innovative pr Strategy. In the field of stockholder communications, Bayer received the Platinum Award of the League of American Communications Professionals (lacp) for its 2005 Annual Report. Finance In January 2007 Bayer received the Treasurer Deals of the Year award (Equity and Equity Linked category) of the Association of Corporate Treasurers in the u.k. for its mandatory convertible bond, which was successfully placed with institutional investors at the end of March 2006. The 2.3 billion bond, issued in connection with the takeover offer for Schering AG, is mandatorily convertible into Bayer AG shares. In 2006 the magazine International Financing Review presented the company with the ifr Award 2005 in the category Euro Investment-Grade Corporate Bonds for its hybrid bond, while the British financial magazine EuroWeek honored Bayer with the illustrious Corporate Bond of the Year designation.

39 Treasurer Deals of the Year (from left): Thomas Böttger and Henryk Wuppermann, representing Bayer s Finance Department, with jury member Nick Mourant Ingenious design: the Makrolon roof element of the zazen concept car received the Materialica Design Award. Bayer AG s investor relations website received its fourth successive award from u.s.-brazilian ir communications consultants mz Consult in the ir Global Rankings 2007. The Bayer site won first place among 145 companies from 33 countries in the Industrials & Health Care category and second place overall. The online version of the 2005 Annual Report was named best corporate online annual report in the world. making it the first such device to be recognized as particularly suitable for people with arthritis who also have diabetes. The commendation followed thorough review and testing by an independent panel of individuals with arthritis. Success for Animal Health, too: an international expert jury selected Profender Spot-on, Bayer s antiparasitic treatment for cats, as the best new small-animal product of 2006. Products Bayer s world-famous product Aspirin garnered two awards in 2006. In what was probably Europe s largest consumer survey, Reader s Digest determined the most trusted brands in 14 European countries. Bayer won the Pegasus Award for the most trusted brand in Germany by a wide margin for the sixth year in succession, receiving 44 percent of votes in the pain relievers category. Aspirin also took the number one position in Austria, Switzerland and Spain. German pharmacists hailed Aspirin as Pain Reliever of the Year 2006 in a representative poll carried out by the German Pharmacists Association, with Bayer products Canesten and Priorin also coming first in their respective categories. Bayer Innovation GmbH also received a special accolade when the Swedish security technology magazine Detektor International, at a ceremony held in Copenhagen, presented it with the Detektor International Award 2006 in the access products category for its new PhenoStor id card. The holographic data storage technology used in the PhenoStor substantially enhances card security. The winners of the Materialica Design Award included applications that benefit from products of Bayer MaterialScience. Prizes were received for the Makrolon roof of Rinspeed AG s zazen concept car and for its interior paint, which is also based on Bayer raw materials. The Ascensia Breeze blood glucose monitoring system received ease-of-use commendation and a product seal from the Arthritis Foundation in the United States,