Bayer Stock Climbs On US Legal Win In Roundup Cancer Claims

(RTTNews) - Shares of Bayer AG were climbing around 11 percent in German trading after the pharmaceutical and life sciences major announced a favorable ruling in the United States in the lawsuit over cancer claims against its Roundup weed killer.

In a statement, the company noted that the Third Circuit Court of Appeals issued its favorable ruling in Schaffner v. Monsanto, unanimously holding that the state-based failure-to-warn claims in this case are expressly preempted by the FIFRA statute.

Plaintiff David Schaffner, who was diagnosed with non-Hodgkin's lymphoma, in his lawsuit alleged that Roundup producer Monsanto corp., Bayer's subsidiary, violated state law by failing to add a cancer warning to the Roundup label.

Bayer, which acquired Monsanto in 2018, said the latest decision creates a circuit split with prior decisions of the Ninth and Eleventh Circuits on the central legal issues in the Roundup litigation.

Bayer further said it is considering the impact of this ruling on other pending litigation and looks forward to presenting its arguments, as fully embraced by the Third Circuit, to the U.S. Supreme Court. Roundup, based on the ingredient glyphosate, was introduced by Monsanto, and the product has been subject to many lawsuits over the years that accused glyphosate of causing cancer.

The World Health Organization's International Agency for Research on Cancer earlier had found that glyphosate is "probably carcinogenic to humans." However, the U.S. Environmental Protection Agency or EPA in a study showed there are no risks of concern to human health when using glyphosate in accordance with its given label and that glyphosate was unlikely to be a human carcinogen.

The European Commission as well as Health Canada's Pest Management Regulatory Agency had also approved its usage saying there is no evidence that linked glyphosate to being carcinogenic.

In 2018, Bayer became the owner of Roundup and the ongoing litigation when it acquired Monsanto. The company, which has been in the midst of several related lawsuits, in 2021 had set aside an amount of $4.5 billion to settle the claims. The company had earlier charged nearly $10 billion for earlier rounds of litigation.

Bayer, in 2021, also reached up to $2 billion agreement with plaintiffs' attorneys to settle related future lawsuits.

Meanwhile, the US Supreme Court in 2022 had rejected an appeal by Bayer to shut down several lawsuits related to Roundup.

In a recent setback, a Philadelphia court's jury in January this year ordered Bayer to pay $2.25 billion in damages to a Pennsylvania man, who claimed to have developed cancer after allegedly using Roundup. Bayer then had stated that the jury's verdict conflicts with the overwhelming weight of scientific evidence and worldwide regulatory and scientific assessments on Roundup.

While responding to the latest verdict, Bayer said, "The Company is pleased with the unanimous decision from the Third Circuit holding that plaintiff's state-based warning claims are expressly preempted by FIFRA. The Court concluded that 'the alleged state-law duty to include the Cancer Warning on Roundup's label (the "Pa. Duty to Warn") imposes requirements that are different from those imposed under FIFRA, and that it is therefore preempted by FIFRA."

According to the company, this decision on federal preemption, a cross-cutting issue in this litigation, creates a circuit split among the federal appellate courts and necessitates a review by the U.S. Supreme Court to settle this important issue of law.

Bayer maintained its support to Roundup products, noting that the weight of scientific evidence and the conclusions of expert regulators worldwide continue to support the safety of glyphosate-based herbicides and that they are not carcinogenic.

On Germany's XETRA, Bayer shares were trading at 29.09 euros, up 10.7 percent.