German pharmaceutical giant Bayer said its agrochemical unit, Monsanto, reached a $7.25 billion settlement in a US court to resolve current and future claims of cancer damage linked to its Roundup weedkiller.
Bayer has been plagued by lawsuits linked to the weedkiller since it bought Monsanto in a $63 billion blockbuster acquisition in 2018. Around 65,000 plaintiffs filed against Monsanto, claiming that usage of Roundup at home and in farming work caused them to develop non-Hodgkin lymphoma and other forms of cancer.
Roundup has been one of the weedkillers of choice in the United States for decades, and Bayer has defended its use, citing several studies that show its active ingredient, glyphosate, is safe for humans. The company has already paid around $10 billion in settlements for all pending lawsuits related to the issue through 2020, but has failed to reach an agreement on future lawsuits.
The current agreement, filed in a state court in St. Louis, Missouri, caps each settlement at an annual amount for 21 years. The deal was struck with Motley Rice, Seeger Weiss, and other law firms representing the bulk of the claimants. Other law firms have already reached settlements, but their terms were not disclosed publicly. For a settlement to be effective, a state judge must approve it, and a minimum number of claimants must sign. Each individual could receive up to $198,000.
The settlement is a welcome sign for Bayer, despite having to increase its provisions and litigation liabilities from €7.8 billion to €11.8 billion, with €5 billion in litigation payouts expected for 2026. Bayer CEO Bill Anderson told investors in a call that he expects the settlement to resolve most of the claims.
However, the settlement can still be struck down by the US Supreme Court. The highest court in the US agreed to hear an appeal on the case, and its decision is expected sometime in April. It may trigger a new wave of litigation and void the current settlement.
