The Federal Trade Commission (FTC) and a coalition of state attorneys general have successfully negotiated a settlement with Corteva Inc., a major pesticide manufacturer, aimed at reducing pesticide prices for American farmers. This agreement comes as a response to allegations that Corteva's loyalty program unfairly restricted distributors from selling lower-cost generic pesticides.

Under the settlement terms, Corteva will eliminate its existing loyalty program, which had limited distributors' ability to engage with generic competitors after Corteva's patents expired. This change is expected to enhance market access for generic pesticide products, ultimately benefiting farmers who have faced high prices for essential crop protection products.

FTC Bureau of Competition Principal Deputy Director David Shaw emphasized that the settlement addresses unfair corporate practices that have negatively impacted farmers. The stipulated order will prevent Corteva from conditioning payments or benefits to distributors based on their purchasing behavior, ensuring a more competitive market for pesticide products.

The lawsuit against Corteva, initiated by the FTC and states in 2022, highlighted how the loyalty program incentivized distributors to block cheaper generic products, allowing Corteva to maintain inflated prices. The settlement also aligns with the FTC's broader efforts to lower living costs for Americans, including a recent agreement with agricultural equipment maker Deere & Company.

While the settlement resolves claims against Corteva, litigation against another pesticide giant, Syngenta, is still ongoing. The FTC's complaint against both companies alleges that their loyalty programs illegally extended their monopolies by excluding lower-priced competitors from essential distribution channels, forcing U.S. farmers to overpay for crop protection products.

The stipulated order will be in effect for 10 years and applies to all of Corteva's post-patent active ingredients. Additionally, Corteva is required to pay $35 million to the state plaintiffs to settle their monetary claims. The FTC's co-plaintiffs include several states, such as California, Colorado, and Texas.