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Brakke Consulting’s
Animal Health News & Notes for January 16, 2004
Copyright © Brakke Consulting, Inc.
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IN THE NEWS:
earnings:
Alcide
Cargill
Swift & Co.
other news:
AB Technology
Animal Nutrition Products
Banfield
Bayer
BioniCare Medical Technologies
Bioniche
Cargill Meat Solutions
Dechra Pharmaceuticals
Janssen
Lallemand
PetCode
Pfizer
Prionics
Ritchey Tagg
SureBeam
Swift & Co.
Synbiotics
Triad Specialty Products
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COMPANY EARNINGS RELEASES
> Swift and Co. reported $15.4 million in 2003 second quarter income compared to $13.7 million in 2002. Net sales for the corporation totaled $2.5 billion, a 23% increase over second quarter 2002 sales. Swift Pork operating income increased 87% to $32.1 million. (Wattnet Meatnews)
> Cargill Inc.’s earnings rose 65% in its second quarter due to strength in several of its agricultural businesses and a onetime gain. The company reported it earned $518 million in the quarter ended Nov. 30 from $314 million a year earlier. Cargill does not release revenue totals or results for individual units. But it said its second-quarter growth was driven by its global grain, oilseed, cocoa, and starch and sweetener businesses. It said beef processing and cattle feeding results were strong, although high costs for cattle hurt beef earnings late in the quarter. (AP)
> Alcide Corporation released financial results for its second fiscal quarter ended November 30, 2003. Alcide earned $61,493 on total revenue of $6.2 million during the quarter ended November 30, 2003 as compared to net income of $434,914 on total revenues on $5.8 million for the second quarter last fiscal year. Earnings for the quarter were adversely affected by expenses related to the Company’s patent infringement lawsuit against Bio-Cide International (which has been successfully settled), and expenses related to removing and writing down the value of SANOVA assets taken out of service during the economic downturn in the poultry industry and from one nonproductive red meat plant. (Business Wire)
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COMPANY NEWS RELEASES
> SureBeam Corp., the industry leader of the manufacture of food irradiation systems, is shutting down and company officials say they will file for Chapter 7 bankruptcy. SureBeam has been unable to meet its financial commitments after it failed to reach an agreement with senior secured lender, Titan Corp., from which SureBeam was spun off about three years ago. SureBeam is facing a raft of shareholder lawsuits and a probe by the Securities and Exchange Commission in the wake of an accounting dispute. In October 2003, a Securities and Exchange Commission investigation was launched against the company, and its two auditors, KPMG and Deloitte Touche Tohmatsu, were fired. SureBeam was also delisted from the NASDAQ Stock Market because of its failure to file quarterly earnings reports with the Securities and Exchange Commission. (Meating Place)
> Bioniche Life Sciences Inc. announced signing of an agreement to purchase the assets of AB Technology Inc. Closing of the agreement is expected in February. A world leader in the development of embryo transfer media, materials and equipment for bovine and equine markets, AB Technology will operate as a unit of Bioniche Animal Health USA, Inc., a division of Bioniche Life Sciences Inc. Synergies resulting from the merger will provide embryo transfer practitioners around the world with a market-leading range of superior livestock reproductive technologies and services. Financial terms were not disclosed. (company press release)
> Synbiotics Corporation announced the USDA approval of their Witness HW in-clinic veterinary diagnostic for the detection of heartworm infection in dogs. Witness HW is now manufactured by an American supplier. The new Witness HW test uses the same Synbiotics antibodies as always. The company added that the heartworm product will soon be followed by Witness FeLV and Witness CPV diagnostics for feline leukemia virus and canine parvovirus, respectively. (Business Wire)
> Banfield, The Pet Hospital and the Veterinary Division of BioniCare Medical Technologies have formed an exclusive partnership to provide dogs the first and only non-invasive, non-drug option already approved by the FDA for the treatment of osteoarthritis of the human knee. Banfield’s exclusive agreement will allow the practice to study how the therapy can be used in the veterinary profession. BioniCare’s BIO-1000TM System, used with humans, uses a soft Velcro wrap around the knee, along with a signal generator that delivers a low amplitude electrical stimulus that reduces pain, improves function, and promotes overall improvement in the treated arthritic joint. (company press release)
> Cargill Meat Solutions has furloughed the first of what could total hundreds of employee layoffs, and Swift & Co. has laid off a total of 270 workers as a result of the overseas ban of US beef in the wake of the Dec. 23 discovery of the country’s first case of BSE. Cargill Meat Solutions, formerly known as Excel Corp., laid off 150 workers and may eliminate 750 more jobs at several of the company’s other plants, which would total about 6% of the company’s export-specified workforce. At the same time, Swift has begun laying off 40 employees from its Greeley processing plant in addition to about 230 job cuts at five plants outside Colorado. (Meating Place)
> Piedmont Pharmaceuticals’ subsidiary, Triad Specialty Products, announced that it has received regulatory clearance to market new Serene Feed-Through Fly Control, a non-organophosphate oral fly control for horses that drastically reduces fly populations in and around barns and stables. Serene Feed-Through Fly Control is effective against both house flies and biting stable flies. The product targets immature flies, and in scientific studies, inhibited 95% of immature stable flies and 100% of house flies from developing into adults. Serene Feed-Through Fly Control is formulated as a pelleted top dressing that passes directly through the horse and is deposited in the manure where flies lay eggs and breed. (company press release)
> Animal Nutrition Products expanded its ArthriMAXX canine product with a 1.5 ml palatable liquid for cats suffering from joint and cystitis ailments. ArthriMAXX is a nutritional supplement that contains glucosamine, MSM, chondroitin, and other vitamins and minerals. The product will be available only through veterinarians. (Animal Pharm)
> EU Dechra Pharmaceuticals and Janssen Animal Health announced the signing of a European marketing agreement, giving Janssen the European marketing rights to Dechra’s canine hyperadrenocorticism product Vetoryl (trilostane) and its feline hyperthyroidism product Felimazole (methimazole). Excluding the UK and Ireland, the agreement gives Janssen marketing rights for an initial period of five years. Dechra will retain the intellectual property rights to the products, and will seek regulatory approvals with Janssen’s assistance. Financial terms were not disclosed. (Animal Pharm)
> INDIA Pfizer and Bayer announced a strategic alliance in India, which gives Pfizer the marketing rights in India for Bayer’s range of livestock and pet health products. Financial terms were not disclosed. (Animal Pharm)
> INDIA Lallemand Animal Nutrition announced that Venky’s India Ltd. will distribute Lallemand’s probiotics and other nutritional technologies in India. Venky’s India, part of the Venkateshwara Hatcheries Group, is an established leader in poultry production and poultry health care. (company press release)
> UK Animal Care and management group Ritchey Tagg of the UK has acquired PetCode, which supplies animal ID electronic microchips. PetCode, which was established in 2000, will be sold through Ritchey Tagg’s veterinary and equine products distributor Brookwick Ward. (Animal Pharm)
> CANADA Prionics AG, the world leader in testing procedures for BSE, announced that the Canadian Food Inspection Agency (CFIA) has chosen the Prionics-Check WESTERN rapid BSE test for the country’s enhanced BSE disease surveillance program. Prionics-Check WESTERN was the rapid test used in Canada during the 2003 BSE investigation. Three CFIA laboratories have now been equipped with the Prionics test. (PRNewswire)
CORRECTION:
Last week’s press release regarding Virbac’s new Clintabs should have read ” Until now, Clindamycin was available only as capsule or liquid formulations.”
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Brakke Consulting’s
2004 Animal Health and Nutrition Overview
“Your Customers, Now and in the Future”
– how are your customers changing?
– is your organization prepared for these changes?
– what is happening in the personnel management area in animal health?
– how are distributors viewed by their customers?
– what have been the successes and challenges for the leading animal health companies?
– market trends and activities in 2003 – 2004
– the Brakke industry outlook for 2004
All these questions will be reviewed and answered at our scheduled seminars. The Overview can also be individually scheduled for your company’s management team. We guarantee that the presentation will be challenging and will cause some rethinking of your business plan.
The Overview will be presented Monday, January 19 at the North American Veterinary Conference in Orlando and Monday, February 16 at the Western Veterinary Conference in Las Vegas. Seating is limited, so reserve your place now.
For more details or to reserve your seat, please call Jane Morgan at 972-243-4033 or email jmorgan@brakkeconsulting.com, or register online at www.brakkeconsulting.com.
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ANIMAL HEALTH NEWS
> VIETNAM Vietnam’s agriculture ministry acknowledged that their tests indicate that the virus affecting chickens in the country is avian influenza, but they have been unable to verify the particular strain of the virus. So far, at least 100,000 chickens have died, according to the Vietnamese newspaper Thanh Nien, and an unknown number of ducks and pigs in the Mekong Delta provinces have also died from the same virus. (Meating Place)
> JAPAN An outbreak of avian influenza has killed about 6,000 chickens on a farm in Japan. The flu was discovered on a poultry farm in Yamaguchi Prefecture. This is the first out break of the virus in Japan for nearly 80 years. Agriculture officials believe the flu is the same strain of virus as that which hit South Korea late last year. The H5N1 type killed around 21,000 ducks and chickens in South Korea last year. (Wattnet Meatnews)
> PORTUGAL Health authorities have detected what appears to be a rare form of scrapie in two sheep in Portugal, the first time the condition has surfaced in the country. Further tests will be carried out in Britain to determine exactly which form of scrapie the sheep had contracted. (AnimalNet – Agence France Presse)
> US Another dairy herd in Washington state has been quarantined after at least one animal was linked to the cow infected with BSE. The USDA believes that as many as seven animals may have been sent to the facility in Quincy, Washington. (Meating Place)
> US The USDA will destroy 130 more cattle in Washington state that might have eaten the same feed as the cow diagnosed with bovine spongiform encephalopathy. The culled cattle will be tested for BSE. More cattle from quarantined herds in Washington could be destroyed as well. (Meating Place)
> US Associations for the nation’s leading produce, beef, pork and seafood producers, along with food retailers and wholesalers, have agreed to craft a program to provide consumers country of origin information about these products, according to an announcement by the United Fresh Fruit and Vegetable Association (UFFVA), National Cattlemen’s Beef Association (NCBA), National Pork Producers Council (NPPC), National Fisheries Institute (NFI), Food Marketing Institute (FMI) and National Grocers Association (NGA). The group announced plans to hold a summit in the very near future with other concerned segments of the food industry to develop a consensus voluntary labeling program. Producers and retailers are committed to developing a cost-effective replacement to the program mandated in the 2002 farm bill. The associations aim to finalize a labeling program by this spring, involving as many segments of the food industry as possible. They will then work with Congress to codify the program into legislation that replaces the mandatory labeling law. (PRNewswire)
> US Demand for beef is still high and rising in the US as wholesalers bought the third-largest largest amount of beef in a one-week period since 1990. During the week ending Jan. 10, beef wholesalers purchased 21.7 million pounds of beef, a figure 42.6% greater than during the week ending Oct. 31, 2003, which was considered a good week, according to the National Cattlemen’s Beef Association. The NCBA expects to see heavy demand through the end of the month and into February. Wholesale beef prices have dropped 19% since the finding of the single case of BSE in Washington state on Dec. 23. (Meating Place)
> US Consumer and health groups asked Agriculture Secretary Ann Veneman to immediately increase testing of cattle for BSE and establish a mandatory animal identification system for tracking cows and beef cattle. In response to the nation’s first case of BSE, Veneman said last month she would accelerate a joint government-industry effort to establish an electronic identification program for tracking every cow in the country. But representatives from the advocacy groups that met with her (including the American Public Health Association, Center for Science in the Public Interest, Consumer Federation of America, Consumers Union, Government Accountability Project and Public Citizen) complained the beef industry still has too great a role in the project. (AP)
> US A livestock specialist at the University of Georgia has developed a scoring system that allows owners to assess the temperaments of cattle so they can breed calmer calves. Studies conducted in Australia, Colorado and elsewhere have shown that serene cattle gain weight faster and provide more tender meat than cranky cattle. Also, calves with poor dispositions can cause costly damage to equipment, fences and harm handlers. The system uses electric eyes and an electronic clock to measure the time it takes for each animal to travel six feet after they leave a chute – restraining devices that hold animals by the neck while they are weighed or examined by a veterinarian. The slower the exit, the calmer the cattle. (AP)
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AGRIBUSINESS NEWS
> Genetically engineered crop plantings increased 15% last year despite continued consumer resistance in Europe and elsewhere, according the International Service for the Acquisition of Agri-Biotech Applications. Seven million farmers in 18 countries grew engineered crops on 167.2 million acres last year, compared with 145 million acres in 2002. According to the ISAAA, about 18% of the world’s 3.7 billion acres under food crop cultivation are biotech. US farmers grew 105.7 million acres of GMO crops, mostly corn, soybeans and cotton. (Drover’s Alert)
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BRAKKE CONSULTING VIEWPOINT
Most of the larger companies seem to be kicking off 2004 with their annual sales meetings and preparing for various industry trade shows. The first of these, the North American Veterinary Conference, begins this weekend in Orlando. Invitations to various media events would indicate that there will be a lot of news next week from the meeting.
I would like to utilize this week’s comments to encourage senior managers in the animal health and nutrition industry to add to your schedules the March 22 – 24 Animal Agriculture Alliance Stakeholder’s Summit in Arlington, Virginia. This day-and-a-half conference is titled “Animal Welfare’s Importance to the Food Chain: Turning Challenges into Opportunities.” The Summit is targeted at senior management of all companies involved from “farm to fork,” with the goal of providing CEO’s, COO’s and CFO’s with the insight and information to successfully meet future challenges. Event sponsors include ADM Animal Nutrition, Brakke Consulting, Cargill Animal Nutrition, National Corn Growers Association, Rabobank, United Soybean Board and the Food Systems Group of Vance Publishing.
This year’s Summit is focused specifically on animal welfare and its importance to all stakeholders in the food chain. Prominent speakers will present some of the newest, most innovative ideas being implemented today that are creating opportunities from these challenges that could impact our entire industry. Other speakers will present new findings from 2004 public opinion polls on consumer attitudes about animal welfare and food safety, as well as an overview of the animal rights movement as compared with other social movements in the US. Additional topics include safeguarding the livestock industry, new track & trace programs, and strengthening communications with our customers, consumers and the media. You can visit www.AnimalAgAlliance.org for more information.
We look forward to seeing many of you in Orlando next week.
Have a great weekend.
Ron Brakke
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