June 29 2020 08:08 AM

Company will make a total payment of $10.1 billion to $10.9 billion to resolve current and address potential future Roundup litigation.

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Bayer announced a series of agreements that will substantially resolve major outstanding Monsanto litigation, including U.S. Roundup product liability litigation.

The German company, with U.S. headquarters in Whippany, New Jersey, acquired Monsanto, St. Louis, the maker of Roundup, for $63 billion in June 2018. Roundup was the first glyphosate-based weed killer but is no longer patent-protected and many other versions are now available.

The U.S. Roundup resolution will bring closure to about 75% of the current Roundup litigation involving about 125,000 filed and unfiled claims overall claiming its herbicide causes cancer.

The resolution also puts in place a mechanism to resolve potential future claims efficiently. The company will make a payment of $8.8 billion to $9.6 billion to resolve the current Roundup litigation, including an allowance expected to cover unresolved claims, and $1.25 billion to support a separate class agreement to address potential future litigation.

“First and foremost, the Roundup settlement is the right action at the right time for Bayer to bring a long period of uncertainty to an end,” says Werner Baumann, CEO of Bayer. “It resolves most current claims and puts in place a clear mechanism to manage risks of potential future litigation. It is financially reasonable when viewed against the significant financial risks of continued, multi-year litigation and the related impacts to our reputation and to our business.”

The company says that before deciding to settle, it considered the alternative course of continuing to litigate Roundup cases. In the company’s risk assessment, potential negative outcomes of further litigation, including more advertising and growing numbers of plaintiffs, upwards of twenty trials per year and uncertain jury outcomes, and associated reputational and business impacts, likely would substantially exceed the settlement and related costs.

“Our company is grounded in the well-being of our customers,” says Baumann. “As a science-based company committed to improving people’s health, we have great sympathy for anyone who suffers from disease, and we understand their search for answers. At the same time, the extensive body of science indicates that Roundup does not cause cancer, and therefore, is not responsible for the illnesses alleged in this litigation. We stand strongly behind our glyphosate-based herbicides, which are among the most rigorously studied products of their kind, and four decades of science support their safety and that they are not carcinogenic.”

Customers, including farmers and other professional users who depend on glyphosate-based herbicides for their livelihoods, will see no change in the availability of Roundup products under these Roundup agreements.