Animal Health News & Notes for May 31, 2002

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Brakke Consulting’s
Animal Health News & Notes for May 31, 2002
Copyright © Brakke Consulting, Inc.

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Company News Releases

>  Meow Mix cat food has been purchased from Nestle Purina by a group of private investors.  The group purchased Meow Mix, as well as Nestle Purina’s Alley Cat brand cat food, on January 31 for an undisclosed sum.  The sale of the brands was part of the agreement to spin off certain brands when Nestle acquired Ralston Purina.  The new company plans to increase spending on advertising and promotion by 40%, including a revival of the 1970’s television ads using the Meow Mix jingle.  (Pet Business)

>  Heska Corporation and Veterinary Pet Insurance (VPI) announced that VPI will now include Heska’s new E.R.D.-Screen Urine Test for renal function as part of VPI’s Vaccination & Routine Care Coverage.  The Vaccination & Routine Care Coverage is a wellness plan that can be added to one of two major medical plans, the VPI Superior Plan and the VPI Standard Plan. (company press release)

>  Pet’s Choice, a veterinary medical group with 50 hospitals in the United States, is partnering with the College of Veterinary Medicine at Texas A&M University to provide the veterinary medical profession with a high-impact program that will address professional and leadership development for the veterinarian.  The focus of the new program will be to develop individual leadership and interpersonal skills in veterinary medical students and veterinarians as they lead teams of people in the workplace. (company press release)

>  Smithfield Foods Inc. confirmed that it sent a letter to Farmland Industries Inc. requesting a meeting on May 31 to discuss the possible combination of Smithfield Foods and Farmland’s Refrigerated Foods Group (pork and beef processing).  Smithfield said that it was prepared to deliver full value to Farmland in any such transaction and to advance the funds to Farmland to enable them to pay the required principal payment to their lenders due today (Friday). According to Smithfield’s Executive Vice President, the proposal provides Farmland with an alternative that Smithfield believes will enable it to avert a bankruptcy, preserve its members’ equity and any attendant uncertainty regarding their businesses, protect the interests of Farmland’s creditors (including holders of subordinated debt) and solve Farmland’s liquidity crisis.  At the time of this posting, Farmland had not issued an official response. (Meating Place)

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BRAKKE CONSULTING, INC.
EXECUTIVE SEARCH AND RECRUITING SERVICES

We continue to expand our executive search business within the animal health, veterinary, pet and specialty chemical markets.  In the past few years, we have filled over 100 positions from division CEO’s to product managers for the leading companies in our industry.  We believe that our services in executive search are of the highest quality.

In 2001, we added field sales recruiting to our search and recruiting services.  We now have two consultants working full time in this area of our business. 

If our your firm has never used Brakke Consulting’s executive search services, we encourage you to either visit out website at www.BrakkeConsulting.com or call any of our offices to learn more about how we are uniquely qualified to help you find the best possible candidate for your position.

Brakke Consulting has the experience, insight, abilities, and contacts that provide our clients with the highest quality services in the animal health, pet, veterinary, and specialty chemicals markets.  Please contact any of our offices for a confidential consultation on our range of services.  Contact information for all offices are available on our website at www.brakkeconsulting.com https://brakkeconsulting.com and click on a starred location on the world map.

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Animal Health News

>  GERMANY   Germany’s agriculture industry was shocked by reports that meat and eggs from chickens fed on wheat tainted with a potentially cancer-causing herbicide may have entered the food chain. The agriculture ministry in the state of Lower Saxony has confirmed that the herbicide Nitrofen, banned by the European Union, was probably fed to poultry at around 100 organic farms.  The tainted wheat was discovered at a farm in the state last week and that a feed distribution company may have sold it to farms across Germany.  (AnimalNet – Agence France Presse)

>  ISRAEL   The Israeli agriculture ministry ordered the slaughter of 1,000 sheep after scrapie was discovered in three flocks in the north of the country.  The killing reportedly took place in March of this year. (AnimalNet – Agence France Presse)

>  IRAN   The English-language Tehran Times paper reported that 30% of Iran’s cattle are infected with an extremely contagious zoonotic hemorrhagic fever.  The story says that the disease has led to the death of at least 20 Iranians since 2001, and more than 140 people have been diagnosed as “carrying the virus.”  (AnimalNet – Agence France Presse)

>  US   The American Veterinary Medical Association (AVMA) Executive Board has approved a position statement advocating regulatory discretion by state feed control officials relative to the marketing of glucosamine products for non-food producing animals.  The AVMA Council on Biologic and Therapeutic Agents recommended the action after the Association of American Feed Control Officials (AAFCO) announced its intention to facilitate the removal of unapproved veterinary novel ingredient products from the marketplace.  Regulatory discretion means that the marketing is not authorized by the regulations, but the regulatory agencies tolerate it because the products appear to be making a positive contribution to animal health care. (Journal of the AVMA)

>  BRAZIL   Brazil recently announced the establishment of a mandatory national ID and traceability system for cattle and buffalo.  Starting in June, all cattle intended for beef export to the European Union will have to be enrolled in the program.  All animals destined to other foreign markets must be enrolled by December 2003.  Producers located in foot-and-mouth-disease-free areas or in the process of declaring a foot-and-mouth-free area should be in the program by December 2005. By December 2007, all cattle and buffalo in the country must be in the program. (Drovers Alert)

>  UK   A pig farmer was convicted of failing to tell officials his herd had foot-and-mouth disease at the start of an epidemic that devastated Britain’s livestock industry last year. The farmer was also found guilty of feeding unprocessed waste to his animals. Sentencing, including a possible jail term or lifetime ban on keeping animals, was expected in late June, but the Judge dismissed suggestions the outbreak was the farmer’s fault. (AnimaNet)

>  US   Agriculture Secretary Ann Veneman ruled out allowing meat to be labeled as grown in North America if it is produced in Canada, Mexico or the United States. Veneman came under criticism recently after she said would consider a request from Canadian cattle producers to develop a “Grown in North America” label. The Canadians are concerned about a new law requiring meat sold in the United States to be labeled with its country of origin. (AP)

>  US   TranXenoGen Inc reported that it has successfully produced monoclonal antibodies in the eggs of genetically modified chickens and that the breakthrough could pave the way for the cheap manufacture of complex drugs in the albumen of specially bred birds. A number of firms are already making antibodies and other experimental protein drugs in the milk of sheep and goats.  So far, the company has only produced chimeric chickens, which contain the gene for producing antibodies in some but not all their cells. The next step will be the development of fully transgenic chickens, with the gene in all their cells, which should improve the yield substantially.
(AnimalNet – Reuters)

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Agribusiness News

>  The Federal Trade Commission (FTC) approved Bayer AG’s acquisition of Aventis CropScience subject to certain conditions. Clearance was given by the European Commission on April 17, 2002.  The FTC’s approval is conditional upon the divestment or outlicensing of a number of products marketed in the United States. The conditions regarding the insecticide fipronil are largely the same as those imposed by the E.U. Commission: the global business in fipronil for agricultural uses must be divested, although Bayer may market the product for non-agricultural uses through a co-exclusive license, except in Europe.  Like the European Commission, the FTC also required that Bayer divest the insecticide acetamiprid in Europe and North America. In addition, the wheat herbicide Everest must be divested, and Bayer’s cotton defoliant Folex, previously sold through ACS, must now be marketed by a third party.  The conditions imposed by the European Commission and the FTC relate to a total sales volume of 650 to 700 million euros. (company website)

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Brakke Consulting Viewpoint

It was a short week in the US due to the Memorial Day holiday, so a rather short newsletter.  During the week we spent some time at the ACVIM meeting here in Dallas, which was attended by some 3,000 veterinarians, a small but quality meeting.  There were no new product launches or announcements that we saw at the meeting.  While there was a lot of discussion related to new technology, not much of it has yet arrived in the marketplace. 

What will the second quarter look like for animal health companies?  This is an important quarter for a number of companies to either keep their momentum for the year or to start reporting softness in the marketplace for one reason or another.  We believe the second quarter will be a mixed bag.  Rumored or reported reductions and reorganizations would indicate we will see some lower-than-predicted results.

Have a great weekend.

[Ron Brakke]

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