The new owners of American agro-chemicals company Monsanto Bayer might have to shell out billions as the former faces a large number of lawsuits.
There are some who believe that the glyphosate-based weedkillers manufactured by Monsanto are carcinogenic.
The company lost a $289m court case last month related to its products Roundup and RangerPro which allegedly had caused cancer in a Californian gardener who had been using the products for a long time.
According to Bayer the number of pending cases against the company had increased to 8,000 from 5,200.
There has been a 11 per cent fall in the share prices of Bayer since the company lost the case in a California court. The case alleged that groundskeeper Dewayne Johnson, had developed terminal cancer from the prolonged exposure to Monsanto herbicides containing glyphosate.
Bayer Chief executive Werner Baumann said that when it bought Monsanto, Bayer "could not foresee the scope of the current lawsuits." The acquisition of Monsanto at $63 billion ended earlier this month.
"In the course of the acquisition, we carried out due diligence as is standard practice when taking over a listed company. In doing so, we of course also considered the legal risks," he said in an interview with Germany's Handelsblatt newspaper.
"Our view is that the number is not indicative of the merits of the plaintiffs' cases", Baumann added during a conference call on Thursday.
The stance of Bayer that the court decision was different from what the regulators in the US and elsewhere believe about the products, reiterated Baumann. The regulators allow the use of glyphosate-based weedkillers.
But the scientific opinion is divided on the issue.
The conclusion that glyphosate is not likely to be carcinogenic to humans was taken by the U.S. Environmental Protection Agency last September.
But glyphosate was classified as "probably carcinogenic to humans" by the World Health Organization in 2015.
Bayer said that the company would attempt to reverse the Californian verdict and if that does not happen then the company would undertake further appeals against the verdict.
Bayer would defend all the cases brought against Monsanto instead of going for out of court settlement, Bauman said.
"Nothing whatsoever has changed in the regulatory status of the product. There is simply very high demand, and has been for many decades, for glyphosate. It is an invaluable tool for growers", said Liam Condon, head of Bayer's Crop Science divisio.
Money for legal defence costs would be set aside in the next financial results to be announced next month, said Bayer’s Chief Financial Officer Wolfgang Nickl. He however said that no apportion would be kept for any possible future damages.
(Source:www.bbc.com)
There are some who believe that the glyphosate-based weedkillers manufactured by Monsanto are carcinogenic.
The company lost a $289m court case last month related to its products Roundup and RangerPro which allegedly had caused cancer in a Californian gardener who had been using the products for a long time.
According to Bayer the number of pending cases against the company had increased to 8,000 from 5,200.
There has been a 11 per cent fall in the share prices of Bayer since the company lost the case in a California court. The case alleged that groundskeeper Dewayne Johnson, had developed terminal cancer from the prolonged exposure to Monsanto herbicides containing glyphosate.
Bayer Chief executive Werner Baumann said that when it bought Monsanto, Bayer "could not foresee the scope of the current lawsuits." The acquisition of Monsanto at $63 billion ended earlier this month.
"In the course of the acquisition, we carried out due diligence as is standard practice when taking over a listed company. In doing so, we of course also considered the legal risks," he said in an interview with Germany's Handelsblatt newspaper.
"Our view is that the number is not indicative of the merits of the plaintiffs' cases", Baumann added during a conference call on Thursday.
The stance of Bayer that the court decision was different from what the regulators in the US and elsewhere believe about the products, reiterated Baumann. The regulators allow the use of glyphosate-based weedkillers.
But the scientific opinion is divided on the issue.
The conclusion that glyphosate is not likely to be carcinogenic to humans was taken by the U.S. Environmental Protection Agency last September.
But glyphosate was classified as "probably carcinogenic to humans" by the World Health Organization in 2015.
Bayer said that the company would attempt to reverse the Californian verdict and if that does not happen then the company would undertake further appeals against the verdict.
Bayer would defend all the cases brought against Monsanto instead of going for out of court settlement, Bauman said.
"Nothing whatsoever has changed in the regulatory status of the product. There is simply very high demand, and has been for many decades, for glyphosate. It is an invaluable tool for growers", said Liam Condon, head of Bayer's Crop Science divisio.
Money for legal defence costs would be set aside in the next financial results to be announced next month, said Bayer’s Chief Financial Officer Wolfgang Nickl. He however said that no apportion would be kept for any possible future damages.
(Source:www.bbc.com)