UPDATE 2-Bayer loses European patent for Yasmin

* Patent Office annuls 2006 decision confirming patent

* Bayer says to study decision before deciding action

(Adds background, Hexal, Novartis)

FRANKFURT, July 8 (Reuters) - German drugmaker Bayer (BAYGn.DE) has lost European patent protection for birth control pill Yasmin, its second-best selling drug, dealing a serious hit to its revenue prospects.

Bayer said on Friday after the market close that the European Patent Office has revoked the patent following an appeal from rival Hexal against an earlier decision in 2006 that confirmed the patent.

"A decision on possible next steps will be taken by the company after studying the reasons for the decision," Bayer said in a brief statement.

The Yasmin family of products slipped from being Bayer's best-selling drug after loss of patent protection in the United States. It had global annual sales of 1.1 billion euros ($1.6 billion) in 2010.

The decision takes immediate effect, a spokeswoman said, although she declined to comment on how soon rivals could bring copycat versions to market.

Bayer had in February warned of the threat from generic rivals to some of its top-selling drugs, including multiple sclerosis injection Betaferon.

Hexal Germany declined to comment. Parent Novartis was not immediately available for comment.

The product group comprising Yasmin, YAZ and Yasminelle is based on the hormones ethinylestradiol (estrogen) and drospirenone.

Evidence emerged this year that users of pills containing drospirenone may run a higher risk of dangerous blood clots.

Bayer's shares closed down 0.9 percent at 57.39 euros.

($1 = 0.689 Euros) (Reporting by Victoria Bryan, Ludwig Burger and Silke Koltrowitz in Zurich; Editing by Jon Loades-Carter and David Hulmes)