The Experts in Animal Health

Brakke Consulting’s
Animal Health News & Notes for December 20, 2002

Copyright © Brakke Consulting, Inc.

>  ConAgra Foods reported results for the second quarter for its food business.  Comprising Packaged Foods, Food Ingredients, and Meat Processing, the division had sales of $4.8 billion for the second quarter and $10.6 billion for the first half of the 2003 financial, down as planned from $6.3 billion and $12.3 billion, respectively, on last year.  First half sales in the Meat Processing sector were $1.1 billion and operating profits were $17 million, which were substantially lower compared to last year because of the reduction in the size of the sector following the decision to sell the fresh beef and pork business. (Wattnet Meatnews)



This year’s report includes an all-new survey of 250 dog and cat owners, as well as a new veterinarian survey. The veterinary survey includes information on new products including ProHeart 6, Iverhart Plus, and Revolution.  In addition, Bayer’s just-launched K9 Advantix is profiled in the report.  Product sales and trends for the veterinary products, as well as an overview of the trends in OTC sales, are also included.

The report will be available until December 20, 2002 at an early-order price of $3,500.  Studies ordered after the Christmas holiday will be priced at $4,000.

For more information, call 972-243-4033 or email Dr. Lynn Fondon at


>  Boehringer Ingelheim Vetmedica announced the appointment of George Heidgerken to the position of President and COO of the company, effective January 1, 2003.  Mr. Heidgerken will have responsibility for all the company’s animal health activities in the US.  (company press release)

>  Alpharma announced that it is closing four animal health facilities. It also will reduce its worldwide workforce by approximately 125 employees, which will affect the human- and animal-health sides of the business. The facility closings include plants at Hannibal, Mo., Lowell, Ark., Parkville, Australia, and Wrightstown, N.J. The company expects these actions to relieve $50 million in related cash and non-cash costs for the fourth quarter.  (Pork Alert)

>  H. J. Heinz Company announced the completion of the spin-off of all the shares of SKF Foods Inc., a subsidiary formed to hold certain of Heinz’s U.S. and Canadian businesses, to shareholders of record at the close of business on December 19, 2002. Immediately, thereafter, SKF Foods was merged with a wholly owned subsidiary of Del Monte Foods Company. The former Heinz businesses which are now a part of Del Monte are: U.S. and Canadian pet food and pet snacks; U.S. tuna; U.S. retail private label soup and College Inn broth; and U.S. infant feeding. (Business Wire)

>  IDEXX Laboratories, Inc. announced that it has received a letter from the FDA providing comments to the Company regarding its application for approval of nitazoxanide, a product for the treatment of equine protozoal myeloencephalitis (EPM). The FDA letter stated that only the Labeling and Freedom of Information Summary portions of the Company’s application remain incomplete. The Company had announced in November that launch of nitazoxanide was likely to be delayed as a result of the anticipated letter, but that the extent of the delay could not be predicted until the Company had received the letter. While it is difficult to predict the timing of an approval, the Company is optimistic that the product will be launched commercially before the end of 2003. (Business Wire)

>  VetCentric, Inc. announced that it recently concluded a $14.5 million equity financing co-led by Sherbrooke Capital Health L.P. and Three Arch Capital, L.P., among others.  VetCentric is the only national veterinary-focused pharmacy that offers convenient home delivery of prescription medications and therapeutic diets to pet owners on behalf of veterinarians. (company press release)

>  PETCO Animal Supplies, Inc. announced that it has reached a tentative agreement to settle all claims related to a previously disclosed California lawsuit which alleged the company improperly classified store managers and assistant store managers as exempt from California overtime laws. This lawsuit is similar to numerous lawsuits filed against retailers and others with operations in California. While the Company denies the allegations underlying the lawsuit, it has tentatively agreed to the settlement to avoid possible disruption to its business from protracted litigation. The settlement, which is subject to final documentation and court approval, is expected to cost a maximum of $2.5 million after tax. (Business Wire)

>  Smithfield Foods is challenging Iowa’s ban on packers owning livestock operations in federal court. Smithfield Foods claims Iowa’s state law is unconstitutional. Smithfield’s lawyers said that the Iowa law violates the U.S. Constitution by interfering with interstate commerce and imposes a taking without just compensation. According to Smithfield, the law also discriminates against Smithfield, because cooperatives and other businesses with more than 60 percent farmer ownership are exempt from the ban. (Meating Place)

>  SureBeam announced it has reached definitive terms with several institutional investors to sell them approximately 5.3 million shares of the company’s common stock for $25.1 million in a private placement.  The proceeds will be used for capital and general corporate purposes.  SureBeam is a leading provider of irradiation processing equipment and services for US food producers.  (Feedstuffs)

>  VMRD, Inc. announced that it has received a USDA license for a new antibody test for Neospora caninum.  The test, named cELISA, is already widely used in Canada and Europe.  The test is available for sale to diagnostic laboratories.  (company press release)

>  MetaMorphix, Inc. announced the formation of a joint venture with Willmar Poultry Company, Inc. to develop, manufacture and market products utilizing MetaMorphix’s Myostatin technology platform in turkeys.  The joint venture plans to develop superior turkeys and to market by establishing key relationships with turkey producers in North America.  Willmar Poultry with its affiliated companies is the largest supplier of poults and hatchery vaccine equipment to U.S. turkey producer companies. Both parties will share equally in development costs and profits. (PRNewswire)

> Inc. announced the international release of i-Production, a software system that is designed to enable livestock production companies to integrate data from multiple sources.  (Feedstuffs)

>  ALGERIA  Ceva Sante Animale signed a protocol of majority entry in Laval, the leading Algerian veterinary products company.  Laval is currently the exclusive Algerian importer of Ceva products, with annual turnover of $6.7 million euros. (company press release)

>  CHILE   Provimi officially opened its second fish feed plant for its Chilean fish feed company Alitec S.A.  Alitec’s main activity is salmon feed production for local distribution.  (Feedstuffs)

>  NETHERLANDS   The Spanish cat litter producer Tolsa s.a. has acquired the Dutch cat litter packer Mostert Absorbents. Mostert Absorbent will continue to work as an
independent entity and no major changes are expected. (Pets International)


>  EU   The EU Commissioner for Health and Consumer Protection has welcomed the political agreement reached today in the Agriculture Council on new rules to control the use of additives in animal feed. The new EU Regulation will strengthen the control of all types of additives in animal
feed, but in particular it completes the EU´s drive to phase out antibiotics as growth promoters. The final text of the
Regulation is likely to be agreed between the Council and the European Parliament during the first half of 2003. (Animalnet – EC press release)

>  US   The EPA is issuing a new rule that mandates all big concentrated animal feeding operations must apply for a permit to control pollution under the Clean Water Act. The EPA is requiring permit holders to develop a “nutrient management plan’’ that sets limits on how much animal manure can be applied to fields.  The rule covers concentrated animal feeding operations, large and small. The new “duty to apply’’ for a permit is aimed at the approximately 15,000 largest facilities with more than 1,000 “animal units’’ – the actual numbers of specific animals vary depending on their type. These operations are generally concentrated on small land areas. (AP)

>  EU  The European Commission has adopted a proposal for a regulation on the identification and registration of sheep and goats, as part of its ongoing efforts to prevent the spread of animal diseases.  The proposed Regulation will reinforce current measures, specifically by introducing gradually in all Member States an identification system to mark each animal, making it possible to trace the individual
movements of sheep and goats. Sheep and goat traded across borders will need this individual identification by July 1, 2003 at the latest. (AnimalNet – EC press release)

>  US   The nonprofit health and research group Physicians Committee for Responsible Medicine (PCRM) filed a lawsuit today charging Tyson Foods with misleading consumers by claiming its chicken products are “all natural” and heart-healthy. Tyson Foods, based in Arkansas, is the largest producer of poultry products in the United States. The case was filed in San Francisco, California. PCRM is charging Tyson with using deceptive advertising practices in two of the company’s campaigns. PCRM’s complaint does not ask for monetary damages. The Physicians Committee for Responsible Medicine is a nonprofit health organization that promotes preventive medicine, especially good nutrition. PCRM also opposes unethical human experimentation and promotes alternatives to animal research. (PRNewswire)

Brakke Consulting “Distributor Effectiveness Study”

(1) What is the influence of distributor representatives relative to purchasing decisions and practices in general?
(2) Who are the distributors that veterinarians do business with and why?
(3) What are veterinarians’ expectations of distributors?
(4) What do distributors do (or don’t do) that influences veterinarians’ purchasing decisions?
(5) How much impact does the distributor have in determining the veterinarians’ purchasing decisions between competitive branded or generic products?

Do you know the answers to these questions?  Are your opinions and thoughts in this area based on information generated by a qualified outside resource or from your own organization?  Brakke Consulting will be conducting a Multi-Client Study to answer these questions in early 2003.  The study will include focus groups, industry interviews and a large veterinary survey.   Please contact any of our offices for more information.


>   Monsanto president and chief executive Hendrik Verfaillie has resigned effective immediately, ending a 26-year career at the agricultural products company.  Board chairman Frank AtLee III will serve as interim CEO while a search is conducted, the release said.  No reason was stated for the changes, but the company has reported big losses this year on declining sales.  For the first nine months of the year, Monsanto lost $1.75 billion, compared to a profit of $399 million a year ago. Sales for the nine months declined 19 percent to $3.45 billion from $4.25 billion. (AP)


Wow!  What a wonderful time of the year.  It is during the holiday season that we all need to recognize and appreciate family, friends, and co-workers.

While some people rush to finish the last project before year-end, others are already enjoying their well-earned holiday vacation.  Did you ever wonder what the world would be like if it were Christmas all year?

The Brakke consultants wish each of you and your families a safe, pleasant, and joyful holiday season.

Ron Brakke
Dick Wilson
John Mannhaupt
John Volk
John Short
Dr. Lynn Fondon
Eli Thomssen
Ken Berkholtz
Jay Lockhart
Gilles Guillemette
Dick Miles
Dr. Atsuo Hata
Roger Cummings
Dr. Karen Felsted
Dr. Jim Guenther
and Jane Morgan

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