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DESPITE COURT RULINGS, SALES OF BAYER'S ROUNDUP CLIMB
Dow Jones reports:

This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (May 2, 2019).

Roundup is getting an advertising boost after thousands of plaintiffs have alleged that the world's most widely used weedkiller causes cancer.

Bayer AG, the manufacturer of Roundup, and Scotts Miracle-Gro Co., which markets it to home-and-garden retailers in the U.S., have spent millions of dollars this year on expanded marketing for the weedkiller, Scotts executives said.

"We were concerned, the retailers were concerned," James Hagedorn, Scotts' chief executive, said Wednesday on a call with investors. So far, he said, U.S. consumers haven't abandoned the product.

Roundup is at the center of lawsuits brought by more than 13,000 farmers, gardeners and others who blame the herbicide for causing their cancer and seek to hold Bayer accountable. The German company acquired Monsanto, Roundup's maker, for $63 billion in 2018.

Residential gardeners and landscapers appear to be buying more Roundup, according to Scotts. Over the first three months of the year, Scotts's sales of Roundup increased 20% from the same quarter a year earlier, the company said. Many farmers, who make up the main market for Roundup, have stood by the weedkiller, considering it less harsh on the environment and people compared with other agricultural chemicals.

Two juries over the past year have ruled in favor of plaintiffs and awarded tens of millions of dollars in damages, sending shares of Bayer about 39% lower in that time. Bayer is challenging the verdicts, and another trial is under way in a California court.

Shares in Scotts climbed 5.4% in Wednesday's late-afternoon trading, while Bayer settled slightly lower in European trading.

Regulators have stood by their assessments showing the herbicide to be safe. The Environmental Protection Agency this week reiterated its previous conclusions that glyphosate, Roundup's main chemical ingredient, is safe when used as directed and doesn't pose a cancer risk. The EPA said it is in the process of renewing glyphosate's U.S. authorization.

Bayer on Tuesday welcomed the EPA's assessment. "Today's EPA announcement is just the latest instance of a global regulatory agency reaffirming that glyphosate is not carcinogenic," the company said.

Some consumer groups criticized the EPA for overlooking research they said showed glyphosate's risks. But regulators in the European Union and Canada have ruled similarly, in some cases after revisiting scientific research that plaintiffs' lawyers have questioned.

Bayer recently paid $20 million to reimburse Scotts for higher costs related to Roundup, including increased ad spending, Scotts executives said. Plaintiffs' lawyers have aired their own TV ads seeking new clients in the litigation against Bayer.

"Given the environment we thought we were in, I think we spent the money extremely well and I think you're seeing the results," Mr. Hagedorn said. "We're two cases into this, and it's the court of public opinion and consumers that matters here."

A Bayer spokeswoman said the company routinely reimburses Scotts for expenses, including ads.


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