Mon­santo faces a surge in law­suits fol­low­ing can­cer rul­ing

The Malta Business Weekly - - INTERNATIONAL -

Amer­i­can agro-chem­i­cals com­pany Mon­santo is fac­ing a surge in law­suits that may cost its new own­ers, Bayer, bil­lions in dam­ages.

Mon­santo man­u­fac­tures glyphosate-based weed­killers which some be­lieve are car­cino­genic.

Last month it lost a $289m court case that al­leged its prod­ucts Roundup and RangerPro had led to a Cal­i­for­nian man's ter­mi­nal can­cer.

Bayer said the num­ber of out­stand­ing cases had risen from 5,200 to 8,000.

The Ger­man firm's shares have lost 11% of their value since it lost the case in a Cal­i­for­nia court to groundskeeper De­wayne John­son, who claimed Mon­santo her­bi­cides con­tain­ing glyphosate, had caused his nonHodgkins lym­phoma.

Bayer shares fell another 1.7% on Thurs­day.

Chief ex­ec­u­tive Werner Bau­mann said that when it bought Mon­santo, Bayer "could not fore­see the scope of the cur­rent law­suits." The $63bn deal was com­pleted ear­lier this month.

"In the course of the ac­qui­si­tion, we car­ried out due dili­gence as is stan­dard prac­tice when tak­ing over a listed com­pany. In do­ing so, we of course also con­sid­ered the le­gal risks," he said in an in­ter­view with Ger­many's Han­dels­blatt news­pa­per.

In a con­fer­ence call on Thurs­day, Mr Bau­mann added: "Our view is that the num­ber is not in­dica­tive of the mer­its of the plain­tiffs' cases".

Mr Bau­mann re­it­er­ated Bayer's stance that the court's ver­dict was not in line with the ap­proach taken by reg­u­la­tors in the US and else­where, which al­low the use of glyphosate-based weed­killers.

How­ever, sci­en­tific opin­ion is di­vided.

The U.S. En­vi­ron­men­tal Pro­tec­tion Agency last Septem­ber con­cluded that glyphosate is not likely to be car­cino­genic to hu­mans.

But the World Health Or­ga­ni­za­tion in 2015 clas­si­fied glyphosate as "prob­a­bly car­cino­genic to hu­mans."

Bayer said it will try to have the Cal­i­for­nian ver­dict re­versed and, if that fails, it would take the ap­peal process fur­ther.

Mr Bau­man said the com­pany would de­fend all the cases brought against Mon­santo rather than set­tle them out of court.

Liam Con­don, head of Bayer's Crop Science divi­sion said: "Noth­ing what­so­ever has changed in the reg­u­la­tory sta­tus of the prod­uct. There is sim­ply very high de­mand, and has been for many decades, for glyphosate. It is an in­valu­able tool for grow­ers."

Chief Fi­nan­cial Of­fi­cer Wolf­gang Nickl said that Bayer's next fi­nan­cial re­sults, due next month, would set aside money for le­gal de­fence costs but not for any pos­si­ble fu­ture dam­ages.

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