German pharmaceutical giant Bayer AG saw its stock tank 12% on Monday after its newly acquired US-based business unit Monsanto was asked to pay $289.2 million in a lawsuit over its weed killer products. Bayer lost as much as $14 billion in value during the sell-off on Monday. The lawsuit alleged that Monsanto’s Roundup and Ranger Pro products contained carcinogenic elements and the company failed to disclose these risks to consumers.
The Missouri-based agro-chemical company has been blamed for publishing false information about the cancer-causing ingredient glyphosate, and the company is now facing several other lawsuits related to its Roundup product. Bayer, however, claims the verdict is not consistent with scientific evidence and can be appealed against.
Although Bayer’s involvement in the case is restricted, it is likely to trouble the German firm, which bought Monsanto for over $60 billion in June this year. Following the success of this trial, other similar lawsuits could pile up and this would not bode well for Bayer, which had to struggle to get the Monsanto acquisition approved in the first place.
On Friday, a judge in California ordered Monsanto to pay $289 million to Dewayne Johnson, a groundsman at a school in Benicia, who is suffering from terminal cancer that was said to be caused by the regular use of the company’s Ranger Pro product.
Several products sold across the US contain glyphosate, which also received renewed approvals for its use in the EU despite opposition. Some agencies have declared that the chemical could be carcinogenic while others have maintained that it is safe.