The Experts in Animal Health

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Brakke Consulting’s
Animal Health News & Notes for January 30, 2009

Copyright © Brakke Consulting, Inc.
Editor: Lynn Fondon, DVM, MBA
earnings news
Fort Dodge
Tyson Foods
other news
Chr. Hansen
Digital Angel
Lohmann AH
Pfizer (Wyeth)
Pfizer Animal Genetics
Registration is now open
Brakke Consulting will be presenting its annual US Animal Health Industry Overview at the Western Veterinary Conference in 2009.
WVC Overview
Monday, February 16th
2:00 – 4:00 pm
Four Seasons, Las Vegas
To register, go to and look for the Overview box on the home page.  Payment by major credit card is required at time of registration.
> Pfizer Inc. reported financial results for the full year 2008.  Full-year 2008 Animal Health revenues were $2.8 billion, an increase of 7% compared with $2.6 billion in 2007, driven by strong global livestock and companion animal product performance. (company website)
> Novartis released results for the full year 2008.  Animal Health recorded revenues of $1.1 billion for the year, an increase of 5%. Companion animal brands Milbemax and Atopica delivered very strong double-digit growth, while Deramaxx and Fortekor growth was very good. Swine feed additive Denagard also delivered excellent volume growth. (company news)  
> Wyeth reported results for the 2008 full year ending December 31, 2008. Revenues for Fort Dodge Animal Health were $1.088 billion, an increase of 4% compared to the prior year.  (company press release) 
> Eli Lilly and Company announced financial results for the fourth quarter and full year of 2008. Sales for animal health division Elanco increased 10% to $1.093 billion. (company press release)

> Colgate-Palmolive reported results for the full year 2008. The Hill’s Pet Nutrition segment recorded net sales of $2.15 billion, an increase of 16% compared to the prior year.  (company press release)
> IDEXX Laboratories, Inc. reported that revenues for the full year 2008. Revenues for the year increased 11% to $1.02 billion from $923 million for the prior year. Companion Animal Group revenues for the year were $834 million, an increase of 11% compared to the prior year. (company website) 
> Abaxis reported results for the third quarter of fiscal 2009, ended December 31. Veterinary market revenues for the quarter were $17.9 million, a decrease of 1% compared to the comparable period in the prior year. Sales of the company’s VetScan chemistry analyzers were up 18% over last year’s comparable quarter. (company press release) 
> Novozymes reported revenues for the full year 2008 were DKK 8.14 billion ($1.6 billion), up 10% from DKK 7.44 billion in 2007. Operating profit was DKK 1.5 billion, up by 2% from the DKK 1.48 billion reported last year. (Animal Pharm) 
> Tyson Foods Inc. reported a net loss of ($112 million) on total sales of $6.5 billion. For the same period a year earlier, Tyson posted net earnings of $34 million on sales of $6.47 billion. (Meating Place) 
> Pfizer and Wyeth announced that they have entered into a definitive merger agreement under which Pfizer will acquire Wyeth in a cash-and-stock transaction currently valued at approximately $68 billion. (company website)
> Intervet/Schering-Plough Animal Health announced it has opened a manufacturing facility in the Netherlands to produce a new poultry vaccine called Sphereon. The facility uses a technology developed in-house, and patented by the company, to freeze-dry live poultry vaccines in to small soluble particles, or spheres, that can be dissolved into water for application as a spray or eyedrop. (Animal Pharm)  
> Pfizer Animal Genetics announced the upcoming availability of GeneSTAR MVP, a new 56-marker DNA panel containing four times more markers than previously available. In addition, the company is unveiling a new Web site to provide producers and allied industry professionals with the latest information regarding animal genomics and genetic marker technology. (company press release) 
> Merial introduced IGENITY software to aid cattle producers in managing and applying inside information from the comprehensive IGENITY profile. Two software applications are available: custom sort and benchmark. The custom sort software is designed to help producers sort and rank their animals based on the traits that are most important to them. Benchmark software is designed to help producers determine where their herd’s genetics compare with others within their respective breed or the nearly half million cattle in the IGENITY database. (company press release)
> Teva Animal Health announced three new product introductions to the DVM Pharmaceuticals brand line.  ChlorhexiDerm Maximum HC is a full-strength antimicrobial, antipruritic shampoo for dogs, cats and horses.  DVM Feline Joint Gel is a complete oral joint supplement for cats.  PhyCox-JS Small Bites are an extension of DVM’s PhyCox-JS Soft Chews joint supplements for dogs. (company press release) 
> Neogen Corporation announced that it has entered into an agreement to become the distributor of Chr. Hansen’s  probiotic feed supplements for the North American swine and poultry markets. Under terms of the agreement, Neogen is granted the distributorship of the feed supplements BioPlus 2Bw and GalliPro Tect WS designed for water application in the US, Mexico, Caribbean, and Central America. (company press release)
> Digital Angel announced the introduction of its new r.Tag system. The electronic transponder r.Tags can be read at distances up to 100 feet, and when coupled with the system’s r.Tag Position Indicators, an animal’s location can be established within a few feet. (company website)
> Vedco, Inc announced that it has signed an agreement with Webster Veterinary Supply to distribute products throughout the US. Vedco has been a long-time supplier to Columbus Serum, which was acquired by Webster in October 2008.  The agreement allows Vedco to continue to supply products to the original Columbus Serum distribution centers, as well as all other Webster Veterinary Supply locations. (company press release)
> ITALY  Lohmann Animal Health announced it has entered the Italian poultry market, having secured the registration of the Salmonella vaccines AviPro Salmonella Vac E and T in that country. (Farming UK) 
> BRAZIL   Tortuga announced it has acquired the animal health and companion animal units of Minerthal, a producer of veterinary products and nutritional supplements. The deal adds more than 40 products to Tortuga’s portfolio, and gives it a presence in the companion animal market. Financial terms were not disclosed. (Animal Pharm) 
> CANADA – AVIAN INFLUENZA   Canadian officials have confirmed an outbreak of H5 avian influenza at a turkey farm in British Columbia (BC). The Canadian Food Inspection Agency (CFIA) imposed a 3-km quarantine around a turkey producer with 50,000 turkeys where avian influenza antibodies were found in some 12-week-old birds. (
> US – CWD   A case of chronic wasting disease (CWD) has been confirmed in a farmed elk in Minnesota. The disease is considered endemic in the states of Wyoming and Colorado, but this is the first case confirmed by the Minnesota Board of Animal Health since 2006. (Animal Pharm)
> US/UK – CANCER COLLABORATION   Henderson Morley announced it will work with Colorado State University to develop treatments for cancer in dogs. The partnership aims to develop treatments for canine melanoma and canine lymphoma. (Animal Pharm)
> US – NIAA RESTRUCTURED   The National Institute for Animal Agriculture (NIAA) announced that its office is moving to Colorado Springs, Colo., where it will share office space with the National Livestock Producers Association. The NIAA Board of Directors has hired the National Livestock Producers Association (NLPA) to manage NIAA. NLPA will serve as an independent contractor and will perform duties commonly performed by the executive director and staff of a trade association. NIAA will remain an autonomous, member-driven organization, with its NIAA Board and Committee Chairs taking an increased leadership role. (association press release)
> US – FOOD SAFETY   The new US Secretary of Agriculture reported that he wants to modernize the food safety system, including focusing meat inspection on pathogen prevention and containment.  “A modernized system would have as a goal prevention, early detection if it can’t be prevented, and mitigation of any adverse impacts if something occurs,” he stated. (Meating Place)
The full year sales and profit reports are now flowing in.  Those that have reported show some reasonable growth for 2008.  In conversations with various industry managers there is a consensus that sales dropped off in the last quarter, taking away from the previous 9 month gains.  Early anecdotal reports for January have indicated some continued softness developing in all sectors. 
We are pleased to note that a number of the smaller and medium sized companies are increasing their sales and marketing staffs for 2009.  Other companies appear to be holding steady after a few small layoffs. The daily news continues to report a challenging environment for general employment numbers.  We’re of the opinion that these reported layoffs and the strains being placed on consumers are likely to spill over negatively into the animal health marketplace.  We continue to believe that 2009 is going to be a challenging year for manufacturers and distributors.
One positive aspect of the Pfizer offer to purchase Wyeth is that it gives the industry something to talk about other than the economy.  I’ll see many of you at that NCBA meeting today.
Have a good weekend!!
Ron Brakke
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