Bayer's stock fell 2.3% Tuesday afternoon, one day after a California couple was awarded more than $2 billion over allegations that its Roundup weedkiller causes cancer.
The decision marked the third consecutive jury verdict against the company over the top-selling herbicide. Bayer said Monday that it would appeal the verdict.
The company's value has fallen roughly 45% since June, when it sealed its $63 billion acquisition of Monsanto, the maker of Roundup. The combination created the world's largest seed and agrochemical company, pairing Monsanto's 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 the ratio of punitive to compensatory damages at 9-1.
Bayer 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 weedkiller 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."
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."
Business on 05/15/2019
Print Headline: Bayer stock falls after losing $2B verdict