Bayer Chief Executive Officer Werner Baumann sought to soothe investors’ worries after a $289 million jury award over the weed-killer Roundup, saying the company is “fully committed” to integrating Monsanto and will fight the verdict.
There is “an awful lot of excitement and enthusiasm” at Bayer about the $66 billion Monsanto purchase, Baumann said on a conference call Thursday.
He reiterated that the company believes the jury decision is “wrong” and “inconsistent with the robust science-based conclusions of regulators and health authorities worldwide.”
“Nothing has changed concerning our strategy, attractive synergy potential and longer-term growth and margin expectations for our combined crop-science business,” Baumann said. “We are very optimistic for the future of the business.”
A California court awarded a school groundskeeper the damages over claims that exposure to Roundup caused his non-Hodgkin’s lymphoma. The trial was the first of many over allegations that the herbicide causes cancer. Bayer has said it will appeal, and US jury awards against companies are often overturned or reduced.
But the German company could still face as much as $5 billion in costs linked to cases over glyphosate, the main ingredient in Roundup, analysts at Sanford C. Bernstein & Co. estimate.The verdict shocked observers both inside and outside Bayer, erasing $16 billion from the company’s market value in a week.
Baumann has contended that facts should rule over emotion in the debate over whether Roundup causes cancer. As of the end of July, about 8,000 glyphosate cases were filed, the company said Thursday.
Baumann said on the conference call he is confident Bayer’s legal resources will help it defend glyphosate and that any appeal in the Roundup case will likely take “a year or longer.”“We want to make sure that glyphosate will continue to be available to our key stakeholders as an excellent, safe and very important tool for modern agriculture,” he added.