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Shares of pharma conglomerate Bayer BAYRY were down 7.1% on March 24, following a setback in the ongoing Roundup Litigation.
Bayer reported that, on March 21, the jury at the Barnes Roundup trial in the State Court of Cobb County, Georgia, reached a verdict in favor of the plaintiff.
Bayer has been ordered by the jury to pay $2.1 billion to the plaintiff ($2 billion in punitive damages and $65 million in compensatory damages).
However, the company disagreed with the jury’s verdict.
In the past year, shares of Bayer have lost 17.7% compared with the industry’s decline of 2.8%.
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More on BAYRY’s Roundup Litigation
Glyphosate is the active ingredient in a number of Monsanto’s herbicides, including Roundup branded products. Bayer acquired Roundup weedkiller through Monsanto’s buyout in 2018. However, several lawsuits have been filed by people for the same, alleging that Monsanto’s herbicide caused them to develop non-Hodgkin lymphoma (NHL) or related cancers.
It has also been alleged by plaintiffs that the glyphosate-based herbicide products are defective and that Monsanto knew, or should have known, of the risks allegedly associated with such products and failed to adequately warn its users.
The ongoing glyphosate litigation in the United States has adversely impacted Bayer’s cash position due to high legal costs.
Nonetheless, the company plans to appeal the latest verdict by the Georgia court and stated that it has secured favorable outcomes in 17 of the last 25 trials.
Bayer had earlier argued that leading health regulators worldwide have repeatedly concluded that its glyphosate products can be used safely and that glyphosate is not carcinogenic.
According to the company, in July 2024, a judge in the Federal Court of Australia (with the aid of a neutral, court-appointed scientific expert and following a scientific conclave process) found in a detailed 322-page opinion that the weight of scientific evidence does not support a link between glyphosate and NHL.
As of Dec. 31, 2024, Bayer’s provision for the glyphosate litigation totaled $5.9 billion.
The company also plans to file a petition for review with the U.S. Supreme Court in the ongoing glyphosate litigation.
BAYRY’s Efforts to Combat Challenges
Bayer plans to pay out only the legally required minimum dividend in 2025, while also looking to reduce its debt. 2024 was a tough year for the company due to strong headwinds in the Crop Science business. The uncertainty caused by ongoing Roundup litigation is also a major hangover on the stock. BAYRY had earlier slashed its dividends to conserve cash, as increasing Roundup litigation charges had adversely impacted the bottom line.