According to The Wall Street Journal, Bayer AG said it would pay up to $10.9 billion to settle tens of thousands of lawsuits with U.S. plaintiffs alleging the company’s Roundup herbicide causes cancer, a milestone in the German company’s legal battle that has been weighing down its share price for nearly two years.
Investors have long been waiting for a settlement to bring clarity over how much the litigation will cost Bayer, following its 2018 purchase of U.S. agricultural giant Monsanto Co. The deal brought the company thousands of Roundup-related lawsuits. Three jury-trial losses tanked shares and sparked a revolt among shareholders angry at Bayer’s management for plunging the company into one of the worst crises in its history with the $63 billion Monsanto acquisition.
The deal does not change Bayer’s view that glyphosate, the active ingredient in Roundup, is safe and does not cause cancer. Bayer did not admit to any wrongdoing as part of the settlement and continued to defend its decision to purchase Monsanto. The company will continue to sell Roundup.
As part of the deal, Bayer said it has set aside between $8.8 billion and $9.6 billion to settle claims brought by lawyers representing some 95,000 plaintiffs, as well as some 30,000 additional claimants that have not yet agreed to the settlement. The company said it would set aside another $1.25 billion to work toward a resolution of future claims, including funding a panel to evaluate whether the product causes cancer. The findings from that panel are geared to help shape the outcome of litigation going forward.