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Bayer’s Attempt To Redeem Image, To Invest $5.6 Billion In Weedkiller R&D


06/14/2019


Bayer’s Attempt To Redeem Image, To Invest $5.6 Billion In Weedkiller R&D
The claims litigations against it in the US over charges that its glyphosate pesticide causes cancer have dented the reputation of Germany’s Bayer and the company is now trying to mend some of that dented image by announcing an investment of 5 billion euros ($5.6 billion) towards research in weedkiller chemicals.
 
In the largest-ever US jury award over charges that glyphosate-based weedkiller Roundup caused cancer in a couple, Bayer was asked to pay up than $2 billion in compensation to the litigants last month which saw its shares hit seven-year lows. This weedkiller belong to the US pesticide company Monsanto which was acquired by the German life sciences group last year.
 
In addition to making the announcement of the huge investment in R&D in weedkillers over the next ten years, Bayer also had s pledged to bring down its emission from its operations and usage of its products by 30 per cent by 2030 by implementing measures such as more precise and more sparing use of crop chemicals by its customers.
 
"We listened. We learned," Bayer said on its website here, adding that it had "heightened responsibility and ... unique potential to advance farming for the benefit of society and the planet."
 
After the significant drop in its stock price, the current valuation of the company now stands at $56 billion which is less than what the company had invested to acquire Monsanto. This has created pressure on the company CEO Werner Baumann who was instrumental in engineering the Monsanto deal but is the one now who faces the ire of shareholders. 
 
“While glyphosate will continue to play an important role in agriculture and in Bayer’s portfolio, the company is committed to offering more choices for growers,” said Bayer, which maintains that glyphosate is safe.
 
Recently, the company faced a third consecutive jury verdict in the US against Roundup and this move comes on heels of those verdicts. Monsanto was acquired by Bayer last year in a deal worth $63 billion which also made it the owner of Roundup. Bayer says glyphosate is safe.
 
The company had already apportioned the announced R&SD investment in a previous budget, said a spokesman for the company.
 
In an attempt to repair its image, its public relations machinery has been beefed up by Bayer. The company however also is under the scanner in Germany because of reports of a collapse in insect populations which is being blamed on excessive use of pesticides in farming.
 
Earlier this year, Bayer hired as chief lobbyist Matthias Berninger who is a former German deputy agriculture minister and green-party politician. It is expected that Bayer would unveil a new strategy for sustainability in the second half of the year under the leadership of Berninger.
 
Enabling more precise application and scaling down crop protection volumes by the company would help it to reduce its environmental footprint, Bayer said. The company also promised greater transparency in research efforts and outcomes and in getting glyphosate re-registering glyphosate in the European Union.
 
“This will help to restore and retain biodiversity, combat climate change, and make the most efficient use of natural resources,” it said.
 
(Source:www.reuters.com)


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