The CEO of Bayer AG is open to settling thousands of cancer lawsuits involving Monsanto Roundup, as long as any accord is “financially reasonable.”
According to Bloomberg News, Werner Baumann discussed the possibility of a Roundup lawsuit settlement during an earnings conference call conducted earlier today. Just ahead of the call, Bayer reported that more than 5,000 cancer claims were recently added to the massive litigation, bringing total filings in the United States to around 18,400.
Baumann reiterated his assertion that Roundup is safe and insisted the lawsuits were without merit. However, he also indicated that the German company was “constructively engaging” with court-appointed mediator Ken Feinberg in a bid to resolve the costly and damaging litigation.
Neither Baumann nor Bayer gave any indication as to what a reasonable settlement might be.
But Carl Tobias, a professor at the University of Richmond’s law school, suggested plaintiffs might not agree with the company’s definition.
“They aren’t going to like the numbers the plaintiffs are going to demand,” he told Bloomberg. “Maybe Ken Feinberg can work something out.”
Glyphosate, the active ingredient in Monsanto Roundup, is the most popular weed killer in the world. But in March 2015, the World Health Organization declared the herbicide a probable human carcinogen, after an independent review linked occupational exposure to an increased risk of cancer, especially non-Hodgkin’s lymphoma and its various subtypes.
The Roundup cancer litigation become Bayer’s problem last year, when it completed a $63 billion acquisition of Monsanto.
The first of three trials began months later, with juries awarding plaintiffs $289 million, $80 million, and $2 billion in damages. However, all of the trial judges eventually reduced the verdicts’ punitive award portions, after finding they were excessive.
Bayer’s share price has dropped about 40% over the past year, largely due to the Roundup cancer litigation. The fallout from the Monsanto acquisition also earned Baumann a rare rebuke from investors earlier this year.
Bayer disclosed today that quarterly sales and earnings missed estimates, and raised doubts about its ability to meet the full-year forecast. According to Bloomberg, the dismal report caused Bayer shares to drop another 3.4% in Frankfurt.
“The jump in lawsuits is worrying,” said Mustaq Rahaman, a credit analyst at Bloomberg Intelligence. “This set of results will do little to stem calls for more dramatic action including a split.