Bayer Aktiengesellschaft (ETR:BAYN) outlined a proposed class settlement and broader containment strategy for Roundup-related litigation during a joint investor and media call, emphasizing that the approach is intended to provide long-term closure while the company also pursues a U.S. Supreme Court ruling on federal preemption.
Settlement framed as part of “multi-pronged” containment strategy
Executives said the timing for a settlement was driven by several years of “containment efforts” and a point at which plaintiff lawyers were willing to negotiate. Monsanto, which Bayer acquired in 2018, reached a class settlement agreement that is subject to court approval in Missouri, where the company said the vast majority of Roundup cases are pending.
The company highlighted the importance of the Supreme Court’s review for the broader question of federal preemption under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA), arguing that regulatory clarity has significant implications for manufacturers, products in development, and U.S. farmers. Bayer cited its upcoming herbicide innovation “Icafolin,” saying it was likely to launch in Brazil before the U.S. because of the regulatory and legal uncertainty.
Key terms of the Missouri class settlement proposal
Bayer’s legal team described the class settlement as a long-term compensation program intended to address alleged Non-Hodgkin Lymphoma (NHL) injuries linked to Roundup exposure. The settlement was negotiated with and supported by multiple plaintiff law firms, which Bayer identified as Holland Law Firm, Ketchmark McCrate, Motley Rice, Seeger Weiss, Waters Kraus Paul and Siegel, and Williams Hart and Boundless.
- Who is covered: Current and potential future plaintiffs nationwide who were exposed to Roundup before February 17, 2026, and who have an NHL diagnosis now or receive one within 16 years after the settlement becomes effective.
- Duration: The claims program can run for up to 21 years, reflecting the latency period for NHL.
- Process: A notice process will inform class members, who may object or opt out. Monsanto retains the right to terminate the settlement without paying claims if opt-outs are excessive.
- Payments: Monsanto would make annual payments to support the program; payments are capped and designed to decline over time. Payments to eligible class members are described as tiered and prioritized based on exposure type, age at diagnosis, and type of NHL.
Company representatives contrasted the new proposal with an earlier 2020 attempt. They said the prior program was limited to four years, included less funding, and contemplated future litigation being guided by an expert science panel. They said the new settlement does not include a science panel and is structured as a more traditional long-term compensation program.
Supreme Court case seen as pivotal beyond glyphosate
Bayer said it will continue to present its case to the U.S. Supreme Court, with a hearing scheduled for April 27. The company referred to the case as “Durnell” and said the Supreme Court will decide whether FIFRA preempts label-based failure-to-warn claims where the U.S. Environmental Protection Agency has not required the warning.
Company counsel argued that the potential impact of a Supreme Court ruling could extend beyond glyphosate and agriculture, noting that similar federal preemption language appears in statutes governing areas including medical devices, poultry products, meat, and motor vehicles.
In Q&A, Bayer said the class settlement would need participation “very close to 100%” to deliver closure, and it declined to provide a specific opt-out threshold that could trigger termination. Executives also declined to speculate on scenarios in which the Supreme Court rules against the company, while reiterating that “everything remains on the table” as part of its broader approach, including settlements, court processes, and potential structural solutions.
Provision increased to EUR 11.8 billion; cash outflow front-loaded
Chief Financial Officer Wolfgang Nickl provided updated financial details, saying litigation provisions and liabilities were increased from EUR 7.8 billion to EUR 11.8 billion. He said the revised total is composed primarily of glyphosate and PCB-related matters, plus smaller items.
- Total provision: Increased to EUR 11.8 billion from EUR 7.8 billion.
- Breakdown (approximate): EUR 9.6 billion for glyphosate; EUR 1.9 billion for PCB; with a remaining balance for other smaller matters.
- Increase allocation: Of the roughly EUR 4 billion increase, about three quarters was glyphosate-related and about one quarter related to PCBs.
Nickl said the provision covers the class settlement, other “strategically necessary” glyphosate settlements, defense and other litigation-related costs, and PCB cases, including the Sky Valley Education Center verdicts and settlements with two additional U.S. states. Bayer did not identify the states, but clarified in Q&A that these were PCB-related settlements.
On cash flow, Bayer said litigation-related cash implications are expected to total about EUR 5 billion in 2026, with the largest annual payments under the proposed class settlement funded in 2026, along with payouts for glyphosate settlements outside the class and PCB settlements. As a result, management said it expects negative free cash flow in 2026. After 2026, Bayer’s current view is that annual litigation-related payments could be roughly EUR 1 billion for the subsequent five years, then “drop significantly” over the remaining period, which could extend up to 21 years, while emphasizing the outlook depends on multiple factors including final approval of the class settlement.
Financing plan includes $8 billion facility; no planned capital increase
To finance the resolutions, Bayer said it signed an $8 billion bank loan facility on the day of the call and plans to use a combination of senior bonds and instruments that receive equity credit from rating agencies. Nickl said Bayer is not planning to use the previously authorized capital increase.
Separately, the company said it moved the communication date for its full-year results to March 4, when it expects to provide additional detail.
About Bayer Aktiengesellschaft (ETR:BAYN)
Bayer Aktiengesellschaft, together its subsidiaries, operates as a life science company worldwide. It operates through Pharmaceuticals, Consumer Health, and Crop Science segments. The Pharmaceuticals segment offers prescription products primarily for cardiology and women's health care; specialty therapeutics in the areas of oncology, hematology, and ophthalmology; and diagnostic imaging equipment and digital solutions, and contrast agents, as well as cell and gene therapy. The Consumer Health segment markets nonprescription over-the-counter medicines for self-medication and self-care; and solutions for nutritional supplements, allergy, cough and cold, dermatology, pain and cardiovascular risk prevention, and digestive health.
