The Experts in Animal Health

Brakke Consulting’s
Animal Health News & Notes for November 16, 2001

Copyright © Brakke Consulting, Inc.
Company Earnings Releases

>  Bayer reported that for the third quarter 2001, Animal Health sales rose by 1%, while in the first three quarters as a whole business was down 4% to 0.7 billion euros ($635 million). The divestiture of the U.S. livestock vaccines business had a negative effect of 1 and 4 percentage points, respectively. The parasiticide Advantage again showed encouraging growth in the United States and Japan. (company website)

>  Alpharma Inc. announced that the financial results for the third quarter and nine months ended September 30, 2001 previously announced in a press release on November 6, 2001 differed, for the reasons disclosed below, from those filed today on Form 10-Q with the Securities and Exchange Commission.  Results for the third quarter and nine months in 2001 are lower than those previously announced by the following: revenue, $17.5 million; gross profit, $10.3 million and net income, $7.1 million. Subsequent to the announcement of results on November 6, oral representations were alleged by certain customers of the Animal Pharmaceutical business that
resulted in a difference in understanding of key terms and conditions related to third quarter sales to these customers. As a result, the Company has modified the revenue recognition for these transactions and has not reflected these sales in third quarter results. The Company expects these sales to be recognized over the fourth quarter of 2001 and the first quarter of 2002. (PRNewswire)

>  Virbac Corporation reported record sales results for the third quarter ended September 30, 2001. Net sales for the 2001 third quarter rose 6% to $14.7 million from $13.8 million for the 2000 third quarter. Virbac’s veterinary division continued to drive sales growth in the quarter, increasing 12% year-over-year. The veterinary division’s sales growth was achieved by solid sales gains from the Preventic and dental product lines. Further contributing to sales, Virbac sold $1.2 million of its recently FDA-approved livestock parasiticide product sold under the trade names of Virbamec and Bovimec.  Net income for the 2001 third quarter was $206,000 compared with $1.1 million for the comparable quarter of 2000. The comparison of expenses in the quarter ended September 30, 2001 versus September 30, 2000 was affected by three important factors. First, the 2000 third quarter results do not reflect an income tax expense, which the Company began recording in the fourth quarter of last year. Second, financial results for the 2001 third quarter included approximately $500,000 of SG&A costs associated with the launch of new products, primarily the Company’s FDA-approved canine heartworm preventive product, Iverhart Plus. Third, R&D expenses increased by $457,000 due to increased ongoing efforts to register new products. (Business Wire)

>  PetMed Express, Inc. announced results for the second quarter ended September 30, 2001. Net income for the second quarter was $393,000 compared to a loss in the second quarter of 2000, and net sales for the second quarter ended September 30, 2001 were $7.8 million, compared to $2.7 million for the second quarter ended September 30, 2000, an increase of 191%. PetMed Express also reported new customer growth in the second quarter ended September 30, 2001of approximately 75,000 new customers, of which 40% of those new customers ordered through the company’s website. (Business Wire)

>  Tyson Foods, Inc. reported results for the fourth fiscal quarter ended September 29, 2001. Fourth quarter sales were $5.09 billion compared to $1.84 billion last year, an increase of 176%  with a 122% increase in volume. Earnings for the fourth quarter of fiscal 2001 were $47.5 million compared to $18.0 million for the same period last year. Sales for the twelve months of fiscal 2001 were $10.75 billion compared to $7.41 billion last year, an increase of 45%.  Earnings for the twelve months of fiscal 2001 were $87.8 million compared to $151.2 million for the same period last year. (PRNewswire)

The 2001 Brakke Flea & Heartworm Study is almost here!

Each fall, Brakke Consulting updates its annual report on the US Flea Control and Heartworm Markets.  The 2001 edition of the study will be available for shipping on Wednesday, November 28.  In addition to updated sales figures for the major products, the study includes two new surveys of small animal veterinarians and retail pet stores, as well as a special section covering the effect of the September 11 terrorist attacks on veterinary income.  The study also includes information on Fort Dodge’s new ProHeart 6 heartworm preventative, and a review of products in development. 

Orders placed before December 15 will receive a discounted price of $3,250.  After that time, the regular price of $4,000 will be charged.  For more information or to pre-order your copy of the report, please contact Dr. Lynn Fondon at  or call (972) 243-4033. 

Company News Releases

>  Merial relaunched its Recombitek Canine Vaccines in the US after voluntarily recalling the products late last year for manufacturing compliance issues.  The vaccine line consists of pure nonadjuvanted vaccines for dogs.  (Veterinary Practice News)

>  Aventis and CVC Capital Partners, a leading European private equity company, have signed an agreement concerning the acquisition of Aventis Animal Nutrition by CVC Capital Partners. Subject to the required approval processes, the closing of the transaction is expected during the first quarter of 2002. The parties have agreed not to disclose the financial terms of the transaction. (company press release)

>  Virbac Corporation introduced First Sight, a plaque-disclosing solution presented as a dry-handle swab for dogs and cats.  The swab instantly reveals plaque buildup in the pet’s mouth with a red dye.  The product will help veterinarians demonstrate to pet owners the need for pet dental hygiene.  (Animal Pharm)

> Ralston Purina has extended its Purina Veterinary Diagnostics line and offering for diabetic cats by launching the Glucotest Feline Glucose Detection System.  The product is a litter additive designed to alert owners of diabetic cats to changes in urine glucose levels.  The Glucotest indicator chips are added to the cat’s litter and change color when they come into contact with urine, with different colors signifying different levels of glucose in the urine.  The additive will be sold only through veterinarians.  (Veterinary Practice News)

>  PRN Pharmacal introduced Collasate, a patented collagen dressing that was created from a proprietary process.  The product speeds healing activity by absorbing wound exudates and forming an occlusive barrier over the wound.  Collasate is safe for use in mammals, birds and reptiles. (company advertisement)

>  Neogen Corporation announced that it has entered into an agreement to become the primary
supplier of veterinary instruments and supplies to one of the largest farm and ranch retailers in the United States, Tractor Supply Company.  Terms of the agreement call for Neogen to begin placing its Ideal Instruments line of veterinary instruments and supplies into Tractor Supply Company stores beginning in early 2002.  As of Oct. 27, Tractor Supply Company operated 320 stores in 28 states, supplying dairy farm and ranch needs. Tractor Supply Company reported sales of $759 million in its most recently completed fiscal year. (PRNewswire)

>  Veterinary Pet Insurance (VPI) officials opened the doors of the company’s new corporate headquarters this week with a ceremonial ribbon cutting.  The opening comes on the eve of VPI’s twentieth anniversary and caps off five years of unprecedented growth in annual sales, number of policyholders and pets protected.  According to VPI, the company currently provides 82% of U.S. pet insurance policies and projects more than a 50% increase in policyholders in 2002 as the demand for pet insurance continues to rise. The new facility is nearly twice the size of the former headquarters. (company press release)

>  Excel Corp. signed a letter of intent to purchase Taylor Packing Co., Taylor By-Products Inc. and related companies.  Terms of the transaction were not disclosed, but the acquisition is expected to close by the end of January 2002, subject to customary conditions, including government approvals.  Taylor Packing is a leading ground beef processor. (Meating Place)

>  AgInfoLink Global Inc. has received notice from the U.S. Patent and Trademark Office that its patent application for a “Method and Apparatus For a Livestock Data Collection and Management System” has been allowed. The patent broadly provides for the tracking for individual animals from the farm to the table and specifically includes claims for (1) individual animal identification, (2) event data collection with radio frequency identification work cards, (3) BeefLink software, for chute-side individual animal data collection, (4) Pony Express software, for the sharing of individual data among past and future owners of the animals, and (5) distributed databases to store the information needed to interface with other software management systems at each stage of production. (company press release)

>  In an effort to bring manufacturing and sales closer, eliminate duplicate operations and strengthen their business structure, Daiichi Pharmaceutical Co. Ltd., Fuji Chemical Industries Ltd. and Daiichi Fine Chemicals Co. Ltd., will be merged to form a single company under the name Daiichi Fine Chemicals Co. Ltd. Daiichi Fine Chemicals Inc. will continue to manage the company’s North American sales, marketing and distribution. (Wattfeed)


Nearly 40 educators and consultants met at Michigan State University on October 26-28, 2001 to discuss the design of a better curriculum in veterinary practice management.  The group aimed to identify, at minimum, the skills veterinary students need in order to be successful in their future careers and then to design a curriculum likely to impart them.  The outcome was a draft outline of a curriculum titled “Veterinary Professional Development and Career Success.”  The curriculum is divided into seven major sections:  life skills management, leadership, communication, business fundamentals, human resources,  ethics, and jurisprudence and legal issues.  There will be on-going deliberation to fine tune the model curriculum and to address the question not asked in this session, i.e., how to teach it, as well as discussions about constraints to adopting the model and resources that might be available.

Brakke Consulting, Inc.
Veterinary Practice Appraisals

Veterinary Practice Appraisal:  What should you know?  How do you select an Appraiser?  Why is it important to have a practice valued?  The Practice Management Group of Brakke Consulting, Inc. has the ability, knowledge, and experience to provide veterinarians with exceptional appraisal and valuations of their practices.  Further information about the practice management services and specifically veterinary practice appraisals can be accessed at:

Animal Health News

>  US   The first case of canine West Nile Virus has been diagnosed in a dog in Georgia.  The dog had neurologic signs, and a blood test for West Nile Virus performed at the University of Georgia’s diagnostic laboratory came back positive.  The dog recovered fully after being treated with antibiotics.  (Veterinary Practice News)

>  SLOVENIA   Slovenia has detected its first suspected case of BSE during mandatory testing at a slaughterhouse.  Definitive confirmation of the disease is expected by the beginning of next
week. In line with European Union regulations, Slovenia, a candidate for EU membership, has introduced tests on all animals older than 30 months and banned the use of meat and bone meal in animal feed.  (Reuters)

>  GERMANY   A case of scrapie has been discovered on a farm in the eastern German state of Saxony-Anhalt.  All 471 sheep on the farm were slaughtered on Tuesday. Final confirmation from a federal testing laboratory is expected in about 14 days. (AnimalNet – Reuters)

>  US   The FDA has declared glucosamine hydrochloride and chondroitin sulfate as Not Generally Recognized as Safe (GRAS) for use in pet foods and dietary supplements.  The declaration was issued by the FDA’s pet food specialist in response to the Pet Food Institute’s request for a determination of the ingredients, which are in wide use.  The declaration implies that the FDA considers products containing these ingredients as subject to regulatory action, but veterinarians are free to continue to prescribe them, like other unapproved drugs.  The ingredients are considered GRAS for use in human supplements. (Veterinary Practice News)

>  IRELAND   An Irish company named Identigen has developed a new process that uses DNA fingerprinting to keep track of cows. The fingerprinting technique, which uses the trade name TraceBack, uses a blood, meat or hair sample taken from the cow and stored. When the meat cuts arrive on supermarket shelves, another sample is taken to track where the cow came from. Samples are matched to verify origins.  Identigen is a spin-off from the Institute of Genetics at Trinity College Dublin.  (Veterinary Informatics)
Brakke Consulting NY Due Diligence Seminar – spaces still available

There is still time to register for the November 28th and 29th BCI Due Diligence conference to be held in New York City.  We can still accommodate a couple more registrations before we are full.  Don’t wait too long.  Call 972-243-4033 for details.

Brakke Consulting Viewpoint

Thanksgiving Comments:

It has been a few years since Thanksgiving has had such significance to most of us.  The events of September 11th and this week’s plane crash in NYC have brought all of us a new sense of reality and reflection.  It has not been a comfortable time for many people the past two months.  Our lives have all been changed in one way or another.  How we and others respond over the
coming months will be critical to our personal psychological and physical well being.

I’m particularly thankful for each of our clients that have supported BCI this year by requesting one or more of our services.  Second, I’m most grateful for the fine group of consultants that we have in the firm that can be counted on to perform above and beyond the call of duty for the firm and our clients.  Finally, it is times like this that one has to be particularly thankful for family and friends.  It is family and friends that we can count on when things are not going so well.

I will be spending most of my Thanksgiving week at our condominium on S. Padre Island, TX with friends and family.  However, during the week I hope to spend some time in support of a colonias project in Matamoros, Mexico.  On a recent trip my wife and I had the opportunity to visit some of the colonias outside of Matamoros. A colonia is one of those small towns that has been built by
homeless people out of extra cardboard and pallets from the factories. In fact, the homes are called pallet homes.  There is no running water, no electricity, no sewer system or paved roads. The need and suffering in the colonias is almost beyond belief. For the past year, we have been supporting and assisting a group of local South Texas churches in the building of a new orphanage in the area. The new facility is now almost totally complete. This group is now starting to build small new concrete homes in the colonias for the most needy along with funding a food program for small children.  We now plan to support this effort.

I hope each of you during this Thanksgiving and Holiday period will be inspired to assist someone in your area who is less fortunate.  We all have so much to be thankful for during this period and we need to share it.


 [Ron Brakke]
This electronic newsletter is the sole property of Brakke Consulting, Inc.
Any use of the contents herein should be approved by and appropriately attributed to Brakke Consulting, Inc.

For more information about Brakke Consulting’s services and syndicated studies, visit our website at

If this email was forwarded to you and you would like to be added to the circulation list, please send an email to ( with “add” typed in the subject line, and your name, title, and company affiliation in the body of the message, and you will be added to the mailing list.  If you would like for us to remove your name from the circulation list, please send an email to ( with “remove” and your name typed in the subject line.

en_USEnglish (United States)