Monsanto proposes $7.25 billion roundup settlement as Bayer seeks to cap legal exposure

Monsanto has agreed to a proposed nationwide class settlement worth up to $7.25 billion to resolve current and future claims that its Roundup herbicide caused non-Hodgkin lymphoma, the latest move by parent Bayer to limit the financial fallout from years of litigation.

The agreement, filed for preliminary approval in Missouri state court, would establish a long-term compensation program covering individuals diagnosed with the cancer now or within 16 years after the settlement receives final approval. Monsanto would fund the program through capped annual payments over as long as 21 years, providing greater certainty over future legal costs.

The settlement adds to mounting liabilities tied to Roundup, which Bayer inherited through its $63 billion acquisition of Monsanto in 2018. The litigation has since become one of the most expensive and protracted legal battles in the agrochemical industry, weighing on the German group’s finances and investor confidence.

Bayer said total provisions and liabilities for glyphosate and related litigation will rise to €11.8 billion ($12.7 billion equivalent) from €7.8 billion previously. The company expects about €5 billion in litigation payments in 2026, pushing free cash flow into negative territory for the year.

To manage the costs, Bayer secured an $8 billion bank loan facility and plans to refinance the borrowings through bond issuance and hybrid securities. The company said it does not intend to raise equity capital.

Supreme Court review could reshape litigation risk

The settlement comes as the U.S. Supreme Court prepares to review the Durnell case, which centers on whether federal pesticide labeling law overrides state-level failure-to-warn claims. Bayer has said a favorable ruling could significantly reduce its exposure by limiting future lawsuits and overturning some existing verdicts.

The class settlement and Supreme Court case address different legal risks. The settlement would compensate claimants regardless of legal theory, while the court’s decision could determine whether additional claims can proceed.

Monsanto said the agreement contains no admission of liability or wrongdoing.

Long-term effort to stabilize financial outlook

Monsanto has separately resolved additional Roundup cases and settled remaining PCB-related verdicts tied to a Washington state school, though financial terms were not disclosed.

Bayer said it would delay its annual financial results and 2026 outlook to March 4 to reflect the settlement’s impact.

Regulators including the U.S. Environmental Protection Agency and authorities in the European Union have concluded glyphosate is unlikely to cause cancer, a position Bayer has cited in its legal defense.

Still, jury verdicts, settlement costs and legal uncertainty have reshaped Bayer’s financial trajectory since the Monsanto acquisition, making the outcome of the proposed settlement and the Supreme Court case central to the company’s efforts to stabilize its balance sheet and reassure investors.