Bayer reaches $7.25B settlement over Monsanto's Roundup accusations

• The German drug giant and crop science company had originally reached a $10 billion settlement in 2020 that covered short-term claims up to four years — but that deal was later scuttled amid legal scrutiny over the claims process.
• The new compensation deal covers claims for up to 21 years.
• The company didn't disclose the average amount expected to be distributed to each recipient.

Zoom out: The latest deal comes as Bayer awaits a Supreme Court ruling that CEO Bill Anderson has said could determine whether Roundup stays on the market in the U.S.

• Anderson told Axios in May that the ruling was critical because the company was facing "crazy regulatory ambiguity" stemming from a dispute between federal and state laws governing the product.

Between the lines: The prospect of a pro-Bayer Supreme Court ruling appears to have worked in the company's favor in negotiations.

• The new settlement terms "are highly favorable to Bayer and serve as a hedge against the downside risk in the unlikely event of an unfavorable Supreme Court ruling," Capstone analyst Walker Livingston wrote Tuesday in a research note.
• Livingston said it's 80% likely the company will prevail in the case.
• "A positive ruling on the question before the Supreme Court should largely foreclose present and future claims based on state label-based warning theories," Bayer said in a statement, adding that the settlement will resolve claims "regardless of legal theory."

The impact: Bayer's stock rose 6% Tuesday.