Roundup

Monsanto's weedkiller Roundup has been at the centre of over 1,000 US court cases over alleged cancer link.
The corporation is facing 11,200 US legal cases over the weedkiller Roundup

The CEO of the German chemical giant Bayer has insisted that the $63-billion (€55.6-billion) takeover of the American agrochemical and agricultural biotechnology corporation Monsanto in 2018 was a "good idea" despite the huge legal costs that are building up over the firm's Roundup weedkiller.

When asked by a journalist from the German newspaper Frankfurter Allgemeine Sonntagszeitung, Bayer CEO Werner Baumann said that "the Monsanto acquisition was and is a good idea."

The multi-billion dollar takeover has turned out to be plagued with other massive expenses.

Two months after the acquisition was completed, Monsanto lost a court case in the US to Dewayne Johnson, a school groundskeeper suffering from terminal non-Hodgkin's lymphoma, who has sued the chemical giant over the glyphosate-based weedkillers Roundup and Ranger Pro.

Initially, the court ordered Monsanto to pay Mr Johnson $239-million in damages, before the amount was reduced to $78.5-million.

Bayer has since filed an appeal against the ruling.

In March, the company faced another setback as a jury in the US ruled that Roundup had been a "substantial factor" in the onset of cancer in an amateur gardener.

In total, Monsanto is facing a total of 11,200 cases in the US over Roundup and the use of the active ingredient glyphosate, a herbicide that is key to Monsanto's business model and one that has been under intense scrutiny around the world.

Bayer CEO, Werner Baumann

Bayer CEO, Werner Baumann has defended the multi-billion dollar deal, despite huge legal costs.
Mr Baumann insists that due diligence was carried out before the acquisition was completed. Bayer has pointed to a number of findings from regulators in Europe, the US and Canada, as well as reams of scientific studies as proof of Roundup's safety.

"Regulatory authorities around the world consider glyphosate-based herbicides as safe when used as directed," argued Bayer, highlighting "800 rigorous studies" of the effects of glyphosate.

The WHO's International Agency for Research on Cancer concluded in 2015 that glyphosate is "probably carcinogenic". Similar judgments have not been issued by the European Chemicals Agency or the European Food Safety Authority.

Since the Monsanto acquisition, Bayer's stock has lost almost 40% of its value.

"The share price is significantly impacted by the legal cases related to glyphosate in America, the discounts are greatly exaggerated," said Mr Baumann.

"The management board enjoys the full backing of the supervisory board," said Mr Baumann, who has been Bayer CEO for almost three years.

He went on to say that the Bayer group had a clear strategy based on dividing up the acquisition into three separate pillars: pharmaceuticals, crop science, and consumer health.

"We want to strategically develop these three pillars, all three markets are attractive."

The idea of breaking up Monsanto into three parts has surfaced since the activist fund, Elliot Management bought a stake in the business.