Bayer CEO Werner Baumann's $63 billion gamble on purchasing Monsanto continues to spiral downward. Not only is Bayer facing more than 43,000 glyphosate claims from Roundup users afflicted with cancer, but now, a small army of farmers are lining up to sue the company over dicamba, another Monsanto herbicide that has been destroying food crops.
In retrospect, Baumann should have thoroughly considered Bayer’s exposure to potential Monsanto liabilities before charging ahead with his acquisition of Monsanto. As far back as 2004, scientists warned that dicamba was up to “400 times more dangerous to off-target plants” than the active ingredient in Roundup. Nonetheless, just as it has stood by the use of glyphosate, the Environmental Protection Agency gave its approval for a new dicamba formulation.
The result? Millions of acres of food crops, from soybeans to tree fruit, have been destroyed. One victim is a peach farmer from Cape Girardeau, Missouri, whose orchards were wiped out by dicamba “drift.” Bill Bader filed suit against Monsanto in 2016. On February 15, 2020, a federal jury awarded him $265 million. Currently, there are more than 140 plaintiffs right behind Bader, all of whom are seeking millions of dollars in damages.
In the wake of three major glyphosate verdicts, Bayer shares have lost over half its value. Since last summer, the company stock had started to rebound, but this latest problem threatens to undo that progress. Since the Bader Farms verdict, Bayer shares have dropped by 8.6 percent.
Small wonder that Bauman is the first CEO of a major German corporation to receive a “no-confidence” vote from investors. On top of that, politicians in Berlin are starting to put pressure on him. Recently, the head of Germany's Green Party warned: “If Bayer wants to save itself the company has to change...it would be for the best if the board made way for a new start.” And if all of that was not bad enough, Baumann is about to lose one of his last supporters. This week, board chairman Werner Wenning, who has stood behind the beleaguered CEO, announced that he will be retiring two years early, stepping down just ahead of the company's annual meeting at the end of April.
The timing for Bayer and Baumann couldn't be worse. Not only has Wenning been Bauman's staunch supporter, but according to the Wall Street Journal, he has played a significant role in guiding Bayer through its current legal crisis.