Bayer Vows Stronger Roundup Defense as It Absorbs Monsanto
(Bloomberg) -- Bayer AG vowed to step up its defense against a wave of U.S. lawsuits over the herbicide Roundup as it began the formal integration of Monsanto Co., acquired for $66 billion in June.
The German drug and chemical giant said it will formally absorb the U.S. company after selling some crop-science businesses to competitor BASF SE to resolve regulatory concerns. Because U.S. authorities insisted that the businesses operate separately until that sale was complete, Bayer said it previously had been barred from steering Monsanto’s legal strategy.
That will now change as the stakes mount in the U.S. battle over Roundup. Bayer is facing $289 million in damages after Monsanto lost the first court case stemming from claims that the weed killer causes cancer. Even if a judge overturns or reduces the award, the trial will probably be the first of many: More than 5,000 U.S. residents have joined similar suits.
“Bayer did not have access to detailed internal information at Monsanto,” the Leverkusen, Germany-based company said in a statement. “Today, however, Bayer also gains the ability to become actively involved in defense efforts.”
The move to integrate the companies came as Bayer shares continued their slide in the wake of the court ruling, falling as much as 6.6 percent on Thursday. The company has lost about 16 billion euros ($18 billion) in market value this week, since the jury’s award in the Roundup case.
Bayer said it believes U.S. courts ultimately will find that glyphosate, the main ingredient in Roundup, wasn’t responsible for the cancer of the California school groundskeeper who was the plaintiff in last week’s case. It’s planning an appeal. Monsanto has insisted for decades that glyphosate is safe.
The latest fall in the shares came after Monsanto failed to block California’s move to list Roundup as a known carcinogen. The state’s Supreme Court declined on Wednesday to hear the U.S. company’s arguments as to why Roundup, the world’s most widely used weed killer, doesn’t belong on the state’s list of chemicals known to cause cancer. An appeals court had rejected the company’s arguments in April.
Bayer said on Thursday it’s considering its options for further legal action regarding the California listing, saying it “requires judicial intervention and correction.”
Bayer is also facing lawsuits in the U.S. over dicamba, another herbicide in Monsanto’s portfolio. The German company said it will also take an active role in any claims for damages over dicamba.
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