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CORRESP
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      Correspondence

              Mr.
                Jim B. Rosenberg

              Senior
                Assistant Chief Accountant

              Securities
                and Exchange Commission

              450
                Fifth Street N.W.

              Washington,
                DC 20549-0305

              Schering
                AG

              E:
                joerg.spiekerkoetter@schering.de

              T:
                +49.30.468-

              15873

                +49.30.468-

              11
                11

              F:
                +49.30.468-

              1
                53 09

              Your
                Ref.

              Your
                letter dated

              Our
                Ref. (please indicate when replying)

              Date

              2005-10-21

    Schering
      Aktiengesellschaft

    Form
      20-F for Fiscal Year Ended December 31, 2004

    Filed
      March 18, 2005

    File
      No. 001-16143

    Dear
      Mr.
      Rosenberg:

    We
      refer
      to your comment letter on the above-referenced matter dated September 15,
      2005.

    We
      have
      responded to the staff’s comment to improve our disclosure related to estimates
      that reduce gross revenue. Attached to this letter as Exhibit 1, we are
      providing language, in disclosure format, that we believe to be responsive
      to
      the staff’s request for additional information concerning this subject. We
      intend to include such disclosure in our future filings on Form
      20-F.

    As
      requested, we enclose as Exhibit 2 supplemental information that the staff
      may
      wish to consider in assessing the adequacy and completeness of our proposed
      disclosure.

    In
      addition to the attachments, we provide additional information below in response
      to your comment. To assist the staff in its review, we have repeated your
      comment and our response thereto immediately following the comment.

    Comment:

              1.

              We
                believe that your disclosure related to estimates that reduce gross
                revenue such as product returns, rebates and discounts could be improved.
                Please provide us the following information in disclosure-type
                format:

              a.

              The
                nature and amount of each accrual at the balance sheet date and the
                effect
                that could result from using other reasonably likely assumptions
                than what
                you used to arrive at each accrual such as a range of reasonably
                likely
                amounts or other type of sensitivity
                analysis.

                      Address

                      Our
                        Ref.

                      Date

                      2005-10-21

                      Page

                      2

              b.

              The
                factors that you consider in estimating each accrual such as historical
                return of products, levels of inventory in the distribution channel,
                estimated remaining shelf life, price changes from competitors and
                introductions of generics and/or new
                products.

              c.

              To
                the extent that information you consider in b. is quantifiable, disclose
                both quantitative and qualitative information and discuss to what
                extent
                information is from external sources, such as end-customer prescription
                demand, third-party market research data comparing wholesaler inventory
                levels to end-customer demand. For example, in discussing your estimate
                of
                product that may be returned, explain, preferably by product and
                in
                tabular format, the total amount of product in sales dollars that
                could
                potentially be returned as of the balance sheet date and disaggregated
                by
                expiration period.

    Response:

    We
      believe
      that our proposed disclosure as provided in Exhibit 1 is responsive to the
      staff’s requests. In our proposed disclosure we have identified the key
      assumptions we use in estimating returns and rebates. We believe that our
      qualitative discussion of the assumptions underlying our estimates conveys
      an
      understanding of the impact that changes in those assumptions could have on
      the
      level of product returns, rebates, and discounts. However, the staff will note
      that we have not included detailed quantitative sensitivity analyses in Exhibit
      1, notwithstanding the staff’s request that we do so, because we have concluded
      that including such details in our disclosure would not significantly enhance
      the ability of users of our financial statements to assess the potential for
      variability in our estimates once they have access to the types of information
      contained in Exhibit 1. In support of this conclusion, we would like to point
      out that (1) the aggregate balances of our accruals for product returns, rebates
      and discounts at December 31, 2002, 2003 and 2004 were relatively insignificant
      (less than 1.3 percent of our annual gross revenues), (2) the amounts
      attributable to individual components of the accrual are even smaller in
      relation to gross revenues, (3) historical revisions to prior provisions have
      not significantly impacted our operating results and (4) for approximately
      35-55
      percent of these accrual estimates there is virtually no potential for
      variability because they can be compared with objectively verifiable information
      known to us before the issuance of our financial statements. Therefore, even
      an
      increase in the factors that drive the remaining portion of these accrual
      estimates to levels beyond the range of what the staff describes as “reasonably
      likely assumptions” would not be expected to have a material effect on our
      reported operating results.

    In
      lieu of
      detailed quantitative sensitivity analyses, we propose to disclose in future
      filings, where applicable, quantitative information concerning relevant
      historical experience as well as qualitative language intended to inform users
      of our financial statements of management’s belief that the potential for future
      variability in our accruals is not significant relative to our reported
      operating results. Furthermore, if despite our expectations to the contrary,
      future circumstances
      result in unexpected material fluctuations we will disclose and discuss such
      fluctuations as part of our Operating and Financial Review and
      Prospects.

                        Address

                        Our
                          Ref.

                        Date

                        2005-10-21

                        Page

                        2

    Comment:

              d.

              If
                applicable, any shipments made as a result of incentives and/or in
                excess
                of your customer’s ordinary course of business inventory level. Disclose
                your revenue recognition policy for such
                shipments.

    Response:

    As
      a
      matter of policy, Schering has not offered and does not intend in the future
      to
      offer incentives to induce a customer to purchase inventory in excess of that
      necessary to meet anticipated demand. On the other hand, in order to address
      specific situations such as product launches and changes in product
      formulations, Schering has on a limited number of occasions made shipments
      of
      specific products pursuant to incentives offered to wholesalers and other
      customers. The purpose of these sales incentive programs was not to induce
      customers to purchase inventory in excess of anticipated demand. We estimate
      that the resulting effect was less than 0.3 percent of total gross sales and
      less than 1.2 percent of operating profit in any one year. As these programs
      have not significantly affected the aggregate levels of gross or net revenues
      for any period, management does not propose to address these isolated and
      insignificant sales incentive programs in its future disclosures. In addition,
      pursuant to the Inventory Management Agreements (described in the following
      paragraph), Schering has provided incentives to U.S. wholesalers not to engage
      in speculative purchases by shipping limited quantities of specific product
      at
      pre-price increase prices.

    During
      the
      past three years, Schering has taken significant steps better to align U.S.
      wholesaler buying patterns with market demand and to reduce levels of inventory
      held at those wholesalers, as described further below.

    In
      prior
      periods in the U.S. market, wholesalers have been known temporarily to build
      up
      inventory levels to higher than normal levels in anticipation of price increases
      or to build up or run down their inventory levels for other reasons not always
      apparent to the pharmaceutical companies. As a result, as of 2003, Schering
      entered into Inventory Management Agreements (IMAs) with wholesalers covering
      approximately 70% of our U.S. pharmaceutical gross sales. These contracts were
      designed to eliminate speculative purchases by wholesalers in excess of
      anticipated end customer demand by establishing target inventory levels at
      the
      wholesalers. In addition, these IMAs provided for regular reporting of inventory
      levels and customer withdrawal data. As a result, inventory levels at
      wholesalers declined from 2.6 months at the end of 2002 to 1.3 months at the
      end
      of 2004. During 2005, Schering further addressed the issue of speculative
      purchasing by U.S. wholesalers by terminating the IMAs and entering into
      Fee-For-Service agreements which will penalize wholesalers for inventory levels
      above an agreed threshold level. Therefore, at the end of 2005 we expect
      wholesaler inventory levels to continue to decline. We believe the result of
      the
      contractual obligations in these agreements which give us increased influence
      over U.S. wholesaler buying patterns combined with improved reporting of
      inventory levels and customer withdrawal data will be a reduction of the actual
      level of product returns as well as a reduction in the variability in our
      product return accrual estimates.

                        Address

                        Our
                          Ref.

                        Date

                        2005-10-21

                        Page

                        4

In
        Exhibit
        1, we have included a statement of our policy with respect to wholesaler
        incentives, a description of the actions Schering has taken in recent times
        to
        align U.S. wholesalers buying patterns with market demand and quantitative
        information concerning inventory levels at participating wholesalers. We
        believe
        our proposed disclosure is responsive to the staff´s request for additional
        information related to incentives to purchase inventory in excess of our
        customers’ ordinary course of business inventory level.

    Comment:

              e.

              A
                roll forward of the accrual for each estimate for each period presented
                showing the following:

              ·

              Beginning
                balance,

              ·

              Current
                provision related to sales made in current
                period,

              ·

              Current
                provision related to sales made in prior
                periods,

              ·

              Actual
                returns or credits in current period related to sales made in current
                period,

              ·

              Actual
                returns or credits in current period related to sales made in prior
                periods, and

              ·

              Ending
                balance.

    Response:

    Pursuant
      to the staff’s request and supplementally to assist the staff in assessing the
      adequacy and completeness of our proposed disclosure as set forth in Exhibit
      1,
      we have attached to this letter, as Exhibit 2, a schedule containing the
      detailed roll-forward of our accruals for product returns, rebates and discounts
      for the three years ended December 31, 2004. However, it should be noted that
      Schering has not historically distinguished in its accounting records between
      actual returns made in the current period related to current period sales and
      actual returns made in the current period related to prior period sales. This
      is
      because wholesalers do not distinguish this information and therefore do not
      indicate this on their return. In order to assist the staff with its review,
      the
      Company has estimated these amounts by analyzing data related to expiration
      dates of products, and attempted to estimate from that information in which
      year
      the sale was made. This estimate is therefore not as precise as it would be
      if
      we had the ability to track this information directly.

    Given
      the
      relatively insignificant amounts involved with respect to the individual
      accruals and the relatively insignificant potential for variability in year
      end
      accrual balances as discussed above, we do not believe that the inclusion of
      this schedule in our financial statements would significantly enhance the
      ability of users of those statements to assess the potential for variability
      in
      our estimates, and, accordingly we do not propose to include such schedule
      in
      our future filings. However, we will continue to monitor the information
      captured in this schedule and to incorporate it into our future disclosures
      as
      appropriate to ensure that users of our financial statements continue to have
      access to the information they need to assess the potential for variability
      in
      our accruals relating to product returns, rebates and discounts

                        Address

                        Our
                          Ref.

                        Date

                        2005-10-21

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                        5

as
        well as
        information concerning material fluctuations from period to period, if any,
        in
        the actual levels of product returns, rebates and discounts.

    Comment:

              f.

              Regarding
                your discussion of results of operations for the period to period
                net
                sales comparisons, the amount of and reason for fluctuations for
                each type
                of reduction of gross sales, i.e. product returns, rebates and discounts,
                including the effect that changes in your estimates of these items
                had on
                your net sales and operations.

    Response:

    Operating
      and Financial Review and Prospects contains a discussion of material changes
      in
      volumes, prices and currency by product, product group and geographic segment.
      Such discussion in