Bayer’s stock falls after $2 billion verdict against Roundup maker Monsanto
Bayer’s stock fell 2% Tuesday afternoon, one day after a California couple was awarded more than $2 billion over allegations that its Roundup weed killer causes cancer. The decision marked the third consecutive jury verdict against the company over its top-selling herbicide. The company has said it will appeal the rulings.
The company’s value has fallen roughly 45% since its $63 billion acquisition of Monsanto, which makes Roundup, was sealed in June 2018. The combination created the world’s largest seed and agrochemical company, pairing Monsanto’s business around genetically modified crops with Bayer’s pesticide portfolio. Other household Bayer brands include Aleve, Alka-Seltzer and its namesake aspirin.
On Monday, a California jury concluded that Monsanto didn’t warn customers about the health hazards of Roundup’s active ingredient, glyphosate. It awarded $2 billion in punitive damages to Alva and Alberta Pilliod, who both developed non-Hodgkin’s lymphoma after using Roundup on their property for decades. They also were awarded $55 million in compensatory damages. But the judgment is almost certain to be reduced, given U.S. Supreme Court rulings that cap that the ratio of punitive to compensatory damages at 9-1.
Bayer, which said Monday it would appeal the verdict, maintains that “glyphosate-based products can be used safely and that glyphosate is not carcinogenic.” It also contends there is no reliable scientific evidence to conclude its herbicide was the “but for” cause of the Pilliods’ cancer “as the jury was required to find in this case.” Glyphosate is the most dominant weed killer worldwide.
The Pilliods, who are in their mid-70s, had been longtime users of Roundup by the time Alva Pilliod was diagnosed with non-Hodgkin’s lymphoma in 2011. Alberta Pilliod received the same diagnosis in 2015.
Monday’s decision follows an $80 million judgment in March to a California man who blamed Roundup for his cancer. In August, a California jury awarded $289 million to a former groundskeeper who said Roundup gave him terminal cancer. A judge later reduced that amount to $78 million, and the verdict is being appealed. Bayer’s stock plunged 10% after both verdicts.
Bayer’s legal troubles are far from over: The company potentially faces thousands of lawsuits from people whose farming and landscaping work brought them in direct, sustained contact with Monsanto’s herbicides.
In contrast to the recent jury decisions, the Environmental Protection Agency handed a regulatory victory late last month to Monsanto, saying that it continues to find “no risks to public health when glyphosate is used in accordance with its current label” and that “glyphosate is not a carcinogen.”
The agency did acknowledge the ecological risks associated with glyphosate and proposed certain measures aimed at helping farmers better target its application. But it said its findings on the human health risks of the compound “are consistent with the conclusions of science reviews by many other countries and other federal agencies.”
“If we are going to feed 10 billion people by 2050, we are going to need all the tools at our disposal, which includes the use the glyphosate,” Agriculture Secretary Sonny Perdue said in a statement about the EPA’s decision. “USDA applauds EPA’s proposed registration decision as it is science-based and consistent with the findings of other regulatory authorities that glyphosate does not pose a carcinogenic hazard to humans.”
But environmental activists quickly criticized the move.
Jennifer Sass, a senior scientist at the Natural Resources Defense Council, said the EPA “is out on a limb here – with Monsanto and Bayer and virtually nobody else.” Nathan Donley, a senior scientist at the Center for Biological Diversity, said the agency had “reached an industry-friendly conclusion that is simply not based on the best available science.”