Bayer Could Lose Billions On Roundup Cancer Lawsuits
May 1, 2019
Infamous German company and creator of aspirin faces increasing financial fears as weedkiller-caused cancer cases heat up in the US.
In June 2018, Bayer bought Monsanto for a whopping $63 billion, a purchase not backed by over 55% of voting shareholders. However, this controversial purchase possessed more pressing concerns. The purchase placed Bayer at substantial legal risk with the thousands of US cancer lawsuits directly tied to use of Roundup, the weed killer created by Monsanto company.
With almost 13,400 Roundup-caused cancer lawsuits pending in the US courts, Bayer could be in for substantial financial strain. Recent reports reveal Bayer-Monsanto could potentially pay over $2.2 billion in relation to the glyphosate litigation. In their worst case scenario, that cost could rise to well over $14.6 billion.
Increasing studies indicate that glyphosate, the key ingredient in Roundup, can cause cancers like non-Hodgkin's lymphoma. Bayer maintains their belief that glyphosate is safe when used as directed, that scientific research is on their side.
However, with two US juries already siding with men who claim glyphosate in Roundup caused their cancer, Bayer may need to reevaluate their stance. Bayer is appealing both of these rulings, but they could still be liable for millions in Roundup payouts.
Bayer CEO Werner Baumann recognized that the Roundup lawsuits and jury rulings laid a “heavy burden” on the company and its investors. However, Baumann insists that the market reaction had been “exaggerated.”
Baumann maintains that Bayer was still in the right to purchase Monsanto. But shareholders may feel otherwise, since Bayer’s stock price folded by 40% since the Monsanto purchase in 2018. Roughly, the company’s worth now equals what they paid for Monsanto.
Bayer shareholders’ unease and distrust in Bayer’s financial decisions continue to grow at an alarming rate. Many wonder of Bayer thoroughly researched Monsanto company before the multi-million dollar purchase. Increasing numbers of shareholders question assert it’s time for drastic structural changes to Bayer company in order to save some of its profits.