A court in the U.S. state of Pennsylvania has drastically reduced the penalty payments of Bayer subsidiary Monsanto in a glyphosate trial.

Monsanto announced on Tuesday that it intends to appeal. Since Bayer acquired the Roundup manufacturer for $63 billion in 2018, the DAX-listed company has been embroiled in numerous lawsuits. Bayer continues to deny that glyphosate is carcinogenic. At the end of last year, Bayer lost two glyphosate cases, with punitive damages totaling over $2 billion. Monsanto stated that it had achieved positive results in 14 of the last 20 court cases. The majority of the cases have now been settled.

The significantly reduced court-ordered penalty for Bayer did not have a lasting impact on the pharmaceutical and agrochemical company's investors on Wednesday. After an initial significant rise in early trading, Bayer's stock was last traded on XETRA with a gain of 0.92 percent at 28.595 euros. However, for the current year, there is still a loss of around 15 percent. Since the end of January, the price has not sustainably exceeded the 30-euro mark.

A trader commented that despite the reduced penalty, the burdens associated with Roundup are still too great to be relieved as an investor. Another stock market analyst called the court's decision unsurprising, as the originally awarded damages of $2.25 billion were "unusually high." However, an all-clear is inappropriate given the many still pending lawsuits with uncertain outcomes.

Goldman Sachs analyst James Quigley also sees the reduced penalty as within expectations. A reduction of about 80 percent has already occurred in other cases.

The current development shows that Bayer must continue to anticipate significant financial burdens from the glyphosate lawsuits despite the reduction in the penalty. The company now needs to rethink its strategy to address future legal and financial challenges.