The deal would make Elanco the second biggest animal health business in the world.
It's a broad restructuring of the German conglomerate, which plans to sell its sun-care and foot care businesses and exit its animal health division.
Analysts warn Bayer could face a "litigious headache" after the $289 million jury award in a product liability case over Monsanto's Roundup pesticide.
"Despite tough farm economics, we delivered a solid second quarter and are staying disciplined on near-term execution of the business," CEO Hugh Grant says.
The deal may help clear the way for European authorities to approve Bayer's acquisition of Monsanto early next year.
The spun-off materials science company had to build out most functions from scratch but has seen surprising early business results.
The deal continues the wave of consolidation in agribusiness, pairing Bayer's strength in crop chemicals with Monsanto's portfolio of seed products.
Antitrust actions, buyer cautiousness, and longer due diligence phases have all contributed to a slowdown in mergers and acquisitions.
The deal would create the world's largest agricultural supplier but Bayer shareholders fear it will be detrimental to its pharmaceutical business
Mobile health apps are becoming more capable and potentially rather useful.
