Bayer more stringent in glyphosate settlement talks due to downturn

German drugs and pesticides company Bayer said the economic downturn has prompted it to take a tougher stance in talks to settle claims it's glyphosate-based weedkillers cause cancer, even as its earnings rose.

The pandemic has significantly slowed the mediation process, it said in a statement on Monday. "The company will consider a deal only if it is financially reasonable and puts in place a mechanism to resolve potential future claims efficiently," Chief Executive Werner Baumann said.

"This applies now more than ever," he added, citing a looming recession and considerable liquidity challenges as a result of the coronavirus pandemic. The number of U.S. plaintiffs blaming its glyphosate-based weedkillers for their cancer reached 52,500, up from 48,600 in February, the company added.

Bayer denies that claims Roundup - or its active ingredient glyphosate - cause cancer, saying decades of independent studies have shown it to be safe for human use. The company added that first-quarter adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) rose 10.2% to 4.39 billion euros ($4.76 billion), surpassing average analyst expectations of 4.17 billion, according to Refinitiv data.

The beat was driven by a 14% gain in earnings at the agriculture division from higher sales of crop chemicals and corn seeds. Earnings were further underpinned by a 19% increase in revenue from stroke prevention drug Xarelto. Bayer warned, however, that it was unable to assess the impact of the pandemic on group earnings this year.

($1 = 0.9223 euros)