The Experts in Animal Health

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Brakke Consulting’s
Animal Health News & Notes for September 2, 2005
Copyright © Brakke Consulting, Inc.
Editor: Lynn Fondon, DVM, MBA
earnings news
Del Monte
Virbac Corp.
other news
American Foods Group
British United Turkeys
Doane Pet Care
Rosen’s Diversified
Sound Technologies
New jobs posted!
A number of new positions have been posted at in the past two weeks. Have you visited the site recently?  Stop by and see why is the easiest way to find and apply to open positions in the animal health industry.
>  Virbac Corporation announced that it has filed its 2004 Annual Report on Form10-K.  Virbac reported net income of $1.5 million on revenues of $77.1 million in 2004 as compared to a loss of ($5.0) million on revenues of $67.1 million in 2003.  The increase in revenues is mainly attributable to the King and Delmarva product portfolio acquisitions made by Virbac in late 2003. These product portfolios have also contributed to higher overall gross profit margins.  (company press release)  
> Del Monte Foods Company reported results for the first quarter ended July 31, 2005. Pet Products net sales were $194.4 million, an increase of 8.6% over the prior year period.  Pet Products operating income increased 39.9% from $16.8 million in first quarter fiscal 2005 to $23.5 million in first quarter fiscal 2006. (Business Wire) 
Brakke Consulting, Inc.
2006 U.S. Animal Health Manufacturers, Distributors and Services Directory Notice
If your company was listed in our 2005 directory, then after Labor Day, the president or another key person will be receiving a letter from Brakke Consulting along with your company’s contact information sheet and an order form.  To be included in the 2006 directory at no charge, update your listing and fax it to 972.243.0925 by October 15th.
The 2006 directory will have current contact information, website addresses, general email addresses, company descriptions, and key personnel for 275 or more companies in the animal health, pet product, and related industries. To request information on how your company can be listed or to request an order form with prices, contact Jane Morgan at 972.243.4033 or email at
> Doane Pet Care Company announced that it has entered into a definitive agreement in which all of the outstanding stock of its parent company, Doane Pet Care Enterprises, Inc., will be acquired by Teachers’ Private Capital, the private investment arm of the Ontario Teachers’ Pension Plan, for total cash consideration of $840 million, subject to customary terms and conditions, including regulatory approvals. As part of the transaction, Teachers’ Private Capital and the Company plan to complete a recapitalization, the goal of which will be to significantly deleverage the Company. As a result of the substantial equity investment being made by Teachers’ Private Capital, proceeds from the transaction will allow the Company to retire all of its outstanding Preferred Stock and reduce the amount of funded debt on its balance sheet. (Business Wire)
> The Iams Company announced the launch of a premium line of wet food for cats and dogs in pouches and cans under the Eukanuba brand.  Eukanuba wet pouches and cans for dogs will be sold in 5.3 oz and 5.5 oz sizes respectively. For cats, pouches and cans will be available in 3 oz servings.  The products are available wherever pet food is sold. (company press release)  
>  Aviagen announced the acquisition of British United Turkeys (B.U.T.) from Merial Ltd.  Aviagen said B.U.T. will be combined with its own Nicholas Turkey Breeding Farms brand to create Aviagen Turkeys, which will be the largest turkey genetics supplier in the world and the only turkey breeder with pedigree flocks on two continents. The acquisition was a purchase of the shares of B.U.T. in the UK and France, but the actual terms were not disclosed.  (Feedstuffs online)
>  Rosen’s Diversified Inc. (RDI) and American Foods Group announced the completion of their merger.  The new national food company will be known as American Foods Group, LLC.  Combined total sales for the two meat companies last year were more than $1.5 billion.  Terms of the agreement have not been announced; however, RDI’s agricultural chemical distribution and fertilizer business units were not part of the deal.  (Wattnet Meatnews)  
>  CareCredit and IDEXX Laboratories, Inc. announced their agreement to integrate CareCredit No Interest Payment Plans in the newest version of IDEXX Cornerstone Practice Management Software Version 6.2 to be released in October, 2005.  From the Cornerstone toolbar, the practice clicks on the CareCredit button and instantly has No Interest and Extended Payment Plans at their fingertips.  The entire process, from application to approval, takes literally seconds. (company press release)
> Sound Technologies introduced a new high-performance compact, Color Doppler digital ultrasound system, LOGIQ Book XP. While the system weighs only 10 lbs., it is a full-featured digital ultrasound system with advanced DICOM connectivity features and TruDigital technologies for post processing, 3D evaluations, storage of up to 30,000 digital data clips and images, and Anatomical M-Mode creation and analysis. (company press release)  
> US – HURRICANE IMPACTS LIVESTOCK INDUSTRIES   Much of the damage wrought by Hurricane Katrina to livestock and poultry production in the path of the storm was confined to cattle operations in Louisiana and Mississippi and to chicken operations in Mississippi, which grows nearly 10% of US chickens, and Georgia. Cattle operations in southern Louisiana were under water Tuesday and Wednesday, and assessments of cattle losses were impossible to make. Cattle operations in Mississippi, where most damage was wind related, reported downed fences and missing cattle that apparently ran to escape the storm. In Georgia, early reports estimated that more than 250,000 chickens were killed in the wake of Katrina. Farmers there said that 17 growout houses were leveled by hurricane-spawned tornadoes. Most chicken plants in Mississippi were down either due to a loss of power or structural damage but, where power was an issue, were being brought back on stream as power was restored, according to a spokesperson for the National Chicken Council. He said hundreds of houses were damaged, but it was difficult to assess the damage and the extent to which birds may have been lost because of failed phone service and impassable roads.  (Feedstuffs online, Meating Place)
>  FINLAND – AVIAN INFLUENZA SUSPECTED   The first case of avian influenza may have been detected in Europe.  Finland’s Agriculture Ministry said the case involved a gull near the city of Oulu, 370 miles north of Helsinki.  Final results of tests are expected in three weeks and it was not immediately clear if the strain of influenza involved is the same as the one circulating in Asia and Russia.  If tests prove the flu to be the H5N1 strain ravaging the poultry industry in Asia, it would be the first recorded instance of it in Europe.  (Yorkshire Post Today)
>  FINLAND – MORE AVIAN INFLUENZA   More than 100 seagulls have been found dead in the northern coastal city of Oulu.  The city’s on-duty veterinarian picked up the carcasses of about a dozen dead birds during the weekend.  Samples of the birds have been sent abroad for closer analysis, but officials believe that the virus was probably a low-pathogen version of avian influenza, which is fairly common among birds, and which does not pose a risk to humans. There has not yet been any indication that high-pathogen avian influenza virus might have spread to Finland. (Helsingin Sanomat)
>  RUSSIA – AVIAN INFLUENZA   Russia’s agriculture ministry reported that the avian influenza was present in 47 villages, while another 80 villages were being kept under observation. The statement came after Russia’s sanitary chief said last week that the influenza outbreak that has spread to seven Russian provinces was under control and stabilizing fast. (AnimalNet – Agence France Presse)
>  US – VESICULAR STOMATITIS   There are now 26 premises in Wyoming under quarantine for vesicular stomatitis virus, according to Wyoming’s State Veterinarian.  The virus has been confirmed in Big Horn, Goshen, Sublette, Washakie, Hot Springs and Fremont counties.  (Caspar Star Tribune)

> VIETNAM – AVIAN INFLUENZA JUMPS SPECIES  Vietnam reported that avian Influenza for the first time has been reported in civets as three of them born in captivity at a national park have died from the virus.  The civets died in late June at the Cuc Phuong National Park about 75 miles south of Hanoi, and samples sent to a Hong Kong lab came back positive for the H5N1 virus. The civets were not fed any type of poultry, and 20 other civets of the same species in adjacent cages did not become sick, according to a park official. He said most other animals at the park have been tested, but none have returned positive results. The World Health Organization and Vietnam health officials are expected to test staff and animal keepers to determine if anyone caring for the civets has been infected with the virus. (Meating Place)
>  US – ANIMAL IDENTIFICATION  Agriculture Secretary Mike Johanns announced the USDA’s guiding principles for development of a public/private partnership that enables the private sector to maintain animal movement data as part of the National Animal Identification System (NAIS). USDA’s four guiding principles for the NAIS are as follows: (1) The system must be able to allow tracking of animals from point of origin to processing within 48 hours without unnecessary burden to producers and other stakeholders. (2) The system’s architecture must be developed without unduly increasing the size and role of government. (3) The system must be flexible enough to utilize existing technologies and incorporate new identification technologies as they are developed. (4) Animal movement data should be maintained in a private system that can be readily accessed when necessary by state and federal animal health authorities. More information about NAIS is available at (AnimalNet – USDA news release)
> US – BSE INVESTIGATION REPORT  An FDA official said the Texas cow diagnosed with BSE earlier this year most likely was infected by contaminated feed consumed before the ban on ruminant protein went into effect in 1997. The investigation was unable to determine if meat and bone meal fed in the herd prior to August 1997 was from domestic or imported sources.  The feed investigation attempted to identify all of the cow’s protein sources that could have explained the infection.  (Feedstuffs online)
> EU – GM OILSEED RAPE APPROVED FOR IMPORT   The European Commission has given the go-ahead for genetically modified oilseed rape known as GT73 for import and processing for use in animal feed. The decision is valid for 10 years and results from an application submitted by the company Monsanto. The GT73 oilseed rape, which is tolerant to the herbicide glyphosate, is already widely used in North America with no reports of any adverse effects on health or the environment.  The latest authorization covers the import and the use as animal feed, but not cultivation or food uses.   (Wattnet Meatnews)
>  US – EXPOS AGREE TO CO-LOCATE   The American Feed Industry Association (AFIA) and the U.S. Poultry and Egg Association signed the official document outlining the agreement to co-locate the organizations’ agricultural expositions beginning January 2007. The action was approved by the executive committee and boards of directors of USPOULTRY and AFIA this summer. (AFIA Electronic Feedgram)
>  US – PLUM ISLAND ANIMAL DISEASE CENTER TO BE REPLACED  The Department of Homeland Security (DHS) startled many in the livestock industry when it made a surprise announcement last week that it will initiate a process aimed at replacing the Plum Island Animal Disease Center, possibly at a new location.  The Plum Island facility is the remote US laboratory where research and diagnostic work is done on the most virulent foreign animal disease pathogens. The existing facility at Plum Island will continue to be maintained and remain fully operational until a new high-security laboratory facility — or facilities — replaces it. The Plum Island facility was transferred from the USDA’s Animal & Plant Health Inspection Service to DHS after the Sept. 11, 2001, terrorist attacks.  (Feedstuffs online)
This week’s continuation of merger and acquisition activity was not enough to take my mind off the disaster in New Orleans and along the Gulf coast of the US.  Tying this in with animal health and nutrition is difficult beyond the obvious problems it will cause with fuel prices and grain shipment.
So while I acknowledge that nature trumps all (as anyone involved with agriculture surely knows), I thought we should be better at preparedness.  The potential for a worldwide flu epidemic, avian or otherwise, added to my thinking.
We are lucky here in the US that our resources are such that even great disasters can be met and New Orleans is right up there with the Chicago fire and San Francisco earthquake.
One tool that helps an organization to prepare is a good understanding of resources.  Back in my corporate days, we did a very detailed analysis of our company in several areas.  The idea was to evaluate the ability of the firm to continue as a going concern.  Now with the cutbacks in corporate staff, such analysis is left to when the company is up for sale.  Might we do better?
Enjoy the weekend and the holiday in the US.
John Mannhaupt
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