Animal Health News & Notes for October 11, 2002

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Brakke Consulting’s
Animal Health News & Notes for October 11, 2002
Copyright © Brakke Consulting, Inc.
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COMPANY NEWS RELEASES

>  Virbac Corporation  announced that it has received FDA approval for Equell Paste, an equine anthelmintic product. Equell is a 1.87% ivermectin paste that is biologically equivalent to the current market leaders, Eqvalan and Zimectrin.  Equell will be manufactured at Virbac Corporation’s PM Resources facility, in a new production suite built exclusively for this product line. Pfizer Animal Health will be the exclusive North American distributor of the product under a licensing agreement with Virbac. Pfizer Animal Health will distribute Equell through its dedicated Equine Business Division. (Business Wire)

>  Pierce Biotechnology, a company that manufactures test kits for transmissible spongiform encephalopathies such as BSE, has developed sample collection kits to assist authorities who are tracking the spread of chronic wasting disease (CWD) in the U.S. deer population.  The kits are designed to ensure a consistent and optimal process of obtaining deer tissues that will lead to quality test results for CWD.  Pierce is marketing the kit to authorities who will use the kits to collect cervid brain stem, lymphatic tissue and other tissues necessary for laboratories to use in testing for CWD. (PRNewswire)

>  Ceva Sante Animale signed a draft agreement to acquire a controlling interest in the first Tunisian private veterinarian laboratory, Interchem Sante Animale.  The company is currently owned by the managing team and the financial group Tuninvest.  (company press release)

>  Central Garden & Pet Company announced that Moody’s revised its outlook on the Company from negative to stable due to the Company’s extension of its primary credit facility through July 2004 and its progress toward transitioning to higher-margin branded product sales from distribution sales. Recent fiscal third quarter financials showing improved profitability and stabilizing revenues signify the positive effect of this strategic change for the company’s future. Also important was improved product mix, with a higher percentage of revenues from the pet segment, thus further mitigating weather-related volatility intrinsic to garden product sales. (Business Wire)

>  Advanced Monitors Corporation announced that its Vet-Temp Professional Instant Ear Thermometer, sold to  veterinary professionals for more than three years, will now be available to pet owners through pet retailers. (Pet Business)

>  A federal judge has sided with Rose Acre Farms in its 12-year dispute with the federal government over food safety regulations. The judge ordered the government to pay $6.1 million, plus 12 year’s interest to Rose Acre. The government must compensate the family-owned business for losses tied to regulations to prevent poisoning from salmonella because  the regulations were misguided in that they relied on ineffective testing methods. The government claimed they traced salmonella outbreaks in three states in 1990 to eggs from three of Rose Acre’s Indiana farms. Regulators refused to allow the company to sell eggs in the shell from the farms, thereby forcing the company to divert eggs into lower-priced breaking markets. The judge said the government never tested any Rose Acre eggs for salmonella during or after the outbreaks. Therefore, regulators could not be sure whether the bacteria were present when the eggs were shipped, or if salmonella was introduced elsewhere. (Watt Poultry)

>  FRANCE   Novartis announced the French launch of Atopica (cyclosporine A) treatment for relief from atopic dermatitis.  Atopica has been shown in clinical trials to provide superior response rates, better skin lesion improvement and higher remission rates when compared to methylprednisolone, with fewer side effects.  Atopica has a wide safety margin and has not been shown to cause increased susceptibility to bacterial, viral or fungal infections.  (company press release)

>  DENMARK   A consortium of companies has purchased all the animal feed operations at Denmark’s largest privately-owned feed company KFK. The group includes Danish Cooperative organization DLG and seven other members, five of which are local cooperatives and two of which are private regional feed companies. KFK makes about 1.4 million metric tons of the nation’s estimated 6.0 million metric ton per year of feed. The proposed acquisition price is 1.6 billion Danish Kroner ($212 million). The purchase would not include KFK’s Swedish feed company, Svenska Fodder, or aquafeed manufacturer, Biomar. (Watt Feed Enews)

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BRAKKE CONSULTING, INC.
Value Added Public Relations

As a service to the veterinary profession, most animal health companies sponsor various consultants in veterinary practice management to speak at national and local veterinary meetings.   The success of animal health manufacturers and distributors is directly dependent upon the success of the veterinarian.  The practice management consultants of Brakke Consulting, Inc. are widely respected speakers, authors, and are experienced at helping both companies and veterinarians learn how to succeed in the continual challenge of serving pet and animal owners.  Contact Roger Cummings, CVPM in the Dallas office at 972.243.4033 or by email at rcummings@brakkeconsulting.com to learn how our practice management consultants can benefit your company. 

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ANIMAL HEALTH NEWS

>  UK   The UK animal health minister announced a pilot project for a new test that could pick up the signs of tuberculosis in cattle more quickly and with greater accuracy than current methods. The gamma interferon method will be
used to test about 660 herds in Wales and parts of England over the next two years. The gamma interferon test works by incubating a blood sample with tuberculins for the day. If the animal has been exposed to the disease gamma interferon is produced. (AnimalNet – PA News)

>  UK   According to a published report from Imperial College London, the BSE epidemic in the 1990’s infected about a million more cows than scientists previously estimated. New results that suggest that over half of BSE cases went unrecognized or unreported during the epidemic in Great Britain.  The new figures indicate that the total number of cattle infected during the epidemic was over two million.  The study used back-calculation methods adapted for analysis of BSE from those originally developed in the early years of the HIV/AIDS epidemic. (Wattnet Meatnews)

>  US   Peck Meat Packing, a division of Emmpak Foods, Inc. is voluntarily recalling approximately 568,000 pounds of fresh ground beef produced on Sept. 23 at its ground beef plant in Milwaukee because of possible contamination by E. coli O157:H7.  The product was produced in the same plant, but is unrelated to the earlier recall of about 2.8 million pounds of ground beef.  The plant has been closed since Oct. 3. The products being recalled today are basically the same as those involved in the last recall, only with different SELL BY dates. (PRNewswire)

>  US   New federal guidelines for labeling cuts of beef, pork and other meats take effect this week, making it easier for consumers to determine the country of origin of the meat they eat.  Under the federal guidelines taking effect today, retailers can label as U.S. products fresh and frozen muscle cuts of beef, veal, lamb and pork; fish; fruits and vegetables; and peanuts if certain standards are met.  Blended or mixed products would bear labels reflecting each country of origin. The labeling system will be voluntary for two years as the USDA works toward a mandatory system. (AP)

>  US   Scientists at the National Center for Toxicological Research have developed a food tag that changes color when food has gone bad. The polymer discs contain complex organic dyes that change color drastically from clear to tell-tale pink, blue or yellow, depending on the type of food. The researchers hope to launch the first disc, which will be inside food packing, to detect the freshness for fish and shrimps.  Other for beef, lamb and vegetables could follow. (Food Systems Insider – Reuters)

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SECOND EUROVET CONFERENCE ANNOUNCED

On December 12-13, 2002, the second Eurovet Conference on EU enlargement and food safety issues will be held in Paris. During these two days, high-level speakers coming from candidate countries, member states and non-EU countries will share the latest information about food safety issues as they are reshaped by the ongoing EU enlargement process.  The conference will cover topics including
-What are the food safety risks involved in this integration ?
-How does the Union prepare to welcome the newcomers ?
-How do the candidate countries prepare to join the Union ?
-What will be the economic impact of the enlargement on the European food supply?

The conference is organized by Eurovet with the partnership of the World Animal Health Organization, the European Commission Health and Consumer Protection Directorate-General and the General Directorate for Food of the French Ministère de l’Agriculture.

If you would like more information on the Conference, visit the website at www.eurovet-conf.org or email to eurovet2002@alternative-sante.com.

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BRAKKE CONSULTING VIEWPOINT

As the Brakke Consulting business has grown in the area of acquisition, divestiture and due diligence assistance, we continue to search for new sources of information that provide insights and thoughts that might be useful to ourselves and our clients.  The following from Jim Collins’ national bestseller, Good to Great, are two good quotes:

”Peter Drucker once observed that the drive for
mergers and acquisitions comes less from sound reasoning and more from the fact that doing deals
is a much more exciting way to spend your day
than doing actual work.” 

“While we noticed no particular pattern in the amount
or scale of acquisitions, we did note a significant difference in the success rate of the acquisitions in
the good-to-great companies versus the comparisons.”

Brakke Consulting believes that successful transactions are a result of planning and strategic fit, not just an attempt to purchase sales for the sake of critical mass.  These transactions generally take longer and require an intermediary to help organize, structure and implement.

In the 16 years we’ve been in business, we’ve been in involved in over 30 successful M&A transactions, as well as numerous projects related to business development.  We’re interested in helping every company find the best fits possible in the acquisition process.  We’re more interested in a long-term success and relationship with our clients than a “quick and easy” transaction that ends up being a problem.

Have a great weekend.

[Ron Brakke]

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