Bayer Ordered to Pay Billions Over Claims Roundup Causes Cancer

Summary

  • Bayer (OTC:) has faced claims and paid billions in settlement over the health damages, mostly blood cancer, caused by its glyphosate herbicide, Roundup.
  • The firm is currently facing 50,000 claims in America and a significant one in Australia amongst others, the outcome of which could push share prices further down.
  • Despite the claims, Bayer insists on the safety of both Roundup and glyphosate.
  • Pending the result of the lawsuits, the company has opted for new active ingredients in household glyphosate-based products to minimize litigation risk.

An amendment to the information released indicates that Bayer has modified the composition of the household version of Roundup as opposed to halting its sales (as pointed out in paragraph 15).

Bayer has spent billions to settle claims suggesting that its glyphosate herbicide, Roundup, is harmful to health, usually leading to non-Hodgkin lymphoma.

Currently, Bayer is confronted with more than 50,000 claims in the United States that have adversely affected its share price while forcing it to make a $2.25 billion payment to a single person in Pennsylvania.

An Australian lawsuit against Bayer and its subsidiaries, involving over 1,000 claimants, represents one of the few lawsuits outside of America and serves as a litmus test for Australia, where Roundup is quite popular.

In the months to come, if the Federal Court judge in Victoria concludes that Roundup triggered lymphoma, the court will then contemplate on whether Bayer was heedless about the dangers of its product and should bear the cost of damages.

Having been utilized globally for about 50 years, Bayer continues to insist on the safety of Roundup and glyphosate.

Damages and Main Claimant

The spokesperson for Maurice Blackburn, the firm handling the claimants, suggested that damages are anticipated to be less than in the United States. However, a lawyer from the firm insists that each person should get a “significant” sum.

Leading the plaintiffs is 41-year-old Kelvin McNickle, who used Roundup to kill weeds for more than two decades on his family’s property and at a vegetation management company. He was diagnosed with lymphoma at the age of 35. Mr McNickle’s lymphoma returned shortly before the trial. He is currently receiving treatment, Maurice Blackburn said.

Apart from this case, there have been four other cases in Australia. Three of these have been permanently stayed by the Federal court and the fourth, another class action, has been paused pending the outcome of the McNickle claim, according to Bayer.

Roundup was developed by U.S. agrochemical company Monsanto (NYSE:), which Bayer bought for $63 billion in 2018.

World Health Organisation’s Conclusion and Bayer’s Defence

The product was rigorously scrutinized in 2015 by the World Health Organization’s cancer research agency as it concluded that glyphosate might probably be carcinogenic to humans, even though they didn’t determine any risk in real world use.

In 2020, Bayer agreed to pay up to $9.6 billion to settle ongoing Roundup lawsuits in the United States but failed to block future lawsuits because it could not get court approval for it.

Bayer mentioned in a recent annual report that it is involved in 31 Canadian lawsuits related to Roundup, including 11 class actions.

With new active ingredients replacing glyphosate in home use products to decrease litigation risk, Bayer has maintained glyphosate-based weedkillers’ sales to farmers.

Even though a few harmful effects have been linked to Roundup, its usage is still permitted by regulators like in America and the European Commission, which extended glyphosate’s approval for another 10 years.

In spite of a slew of lawsuits, Bayer has managed a mixed record in defending their product in U.S. courts, they have won 10 out of the last 16 Roundup trials.

The ongoing legal battles concerning the glyphosate-based weedkiller could directly affect Bayer’s share price and the volatile situation may affect the trading of such assets in the international market.

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