Bayer admitted on Monday that its Monsanto unit had compiled lists of influential critics and supporters of pesticides across Europe, saying the policy was in breach of company policy and may have been illegal.
The affair, which surfaced initially only in France, deals another blow to the German pharmaceuticals and chemicals group, which is facing intense shareholder pressure over its decision to buy Monsanto in a landmark $63bn deal last year.
Bayer’s share price has plunged 40 per cent since the acquisition, largely in response to two California court rulings that found a causal link between Monsanto’s best-selling glyphosate-based weedkillers and cancer. As the new owner of Monsanto, the German group has been ordered to pay close to $160m in damages already, but now faces an avalanche of more than 13,000 cases in US courts that make similar claims.
Bayer rejects the cancer claims, and says it is confident that the initial verdicts will be overturned on appeal.
In the latest sign of rising investor concern, a majority of shareholders at last month’s annual meeting backed a no-confidence motion against chief executive Werner Baumann and the rest of the board, an unprecedented move against a blue-chip German company.
The Monsanto deal has now come back to bite the maker of aspirin in Europe as well, after French prosecutors revealed on Friday that they were investigating claims that the US group had kept a list of 200 influential politicians, activists, journalists and other people, and collected information about the subjects. Bayer issued a statement over the weekend confirming the allegations, saying the practice dated back to 2016.
“We understand that this initiative has raised concerns and criticism. This is not the way Bayer seeks dialogue with society and stakeholders. We apologise for this behaviour,” Bayer said on Sunday, adding that it had asked an external law firm to investigate the allegations.
Matthias Berninger, Bayer’s head of government affairs, on Monday admitted that the practice had not been limited to France, but had extended to other European countries, including Germany.
“There have been a number of cases where, as they would say in football, not the ball was played but the man, or woman, was tackled,” Mr Berninger told a conference call, according to Reuters. “When you collect non-publicly available data about individuals a Rubicon is clearly crossed.”
Bayer separately said on Monday that it had sold its Coppertone sun care brand to German cosmetics group Beiersdorf for $550m. The sale had been on the cards since last year, when Bayer announced a post-Monsanto restructuring drive aimed at shedding non-core assets and trimming the group’s workforce by 10 per cent. Coppertone had sales of $213m last year.
Heiko Schipper, the Bayer board member in charge of consumer health, said: “Since Bayer took ownership of Coppertone in late 2014, we have made progress in revitalising the brand and developing an exciting pipeline of innovative products . . . We look forward to seeing the brand taken to the next level of success under Beiersdorf’s ownership.”
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