The Experts in Animal Health

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Brakke Consulting’s
Animal Health News & Notes for March 4, 2011

Copyright © Brakke Consulting, Inc.
Editor: Lynn Fondon, DVM MBA
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> Bayer reported results for the full year 2010.  Animal health sales were EUR 1.12 billion ($1.48 billion), an increase of 15% (8% after adjusting for currency effects) compared to the prior year. (company website) 
> PetSmart, Inc. reported financial results for the fiscal year 2010 ended January 31, 2011. Total sales for the year were $5.7 billion, up 7% compared to the prior year. Net income was $240 million, a 21% increase over the prior year. (Business wire)
> German pet retailer Fressnapf reported results for 2010.  Turnover was EUR 1.28 billion ($1.77 billion), an increase of 7.6% compared to the previous year. The total number of Fressnapf stores rose to 1,146 in 2010: 794 in Germany, 352 in other European countries. (Pets International) 
> Brazilian animal health company FormilVET reported a 15% increase in sales for the year 2010. The company achieved net revenues of $18.3 million in the year ended December 31st 2010, compared to $15.9 million in 2009. (Animal Pharm) 

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> Merck announced that its proposed joint venture with Sanofi-aventis to form a joint venture between animal health divisions Merial and Intervet/Schering-Plough will likely close in the third quarter of 2011. (Reuters) 
> Pfizer Inc. announced that the company completed its acquisition of King Pharmaceuticals for $14.25 per share, or $3.6 billion. King and its Alpharma Animal Health division are now wholly owned subsidiaries of Pfizer. (company website, Feedstuffs)
> Teva Animal Health announced that its Free Form Snip Tips omega-3 free fatty acid supplement has returned to the market.  The product is marketed under the DVM Pharmaceuticals brand. (company press release) 
> IDEXX Laboratories and IRIS International announced a 5-year extension to their exclusive supply agreement wherein IRIS will be the sole supplier of the StatSpin VT and similar stand-alone veterinary centrifuges for all of IDEXX’s in-clinic needs in the US and Europe. (Veterinary Advantage)
> Heska announced the addition of a lactate meter analyzer to its portfolio of in-clinic blood analyzers.  The handheld portable analyzer is supplied by Roche. (company press release) 
> VetDC announced that the company has acquired from Gilead Sciences, Inc. an exclusive North American license to develop and commercialize Gilead’s investigational molecule, GS 9219, for use in animal cancer.  GS 9219 has shown efficacy for the treatment of canine lymphoma. (company press release) 
> PetSmart and GNC announced the availability of GNC Pets, a complete line of vitamins and supplements from GNC, at PetSmart stores.  Nearly all of the 150+ products in the GNC Pets line are NASC-certified. (Business Wire)
> Private equity firm MidOcean announced that it has acquired an equity position in Freshpet, a manufacturer of refrigerated petfood.  Freshpet’s strategic partner, Tyson Foods, remains an investor and distribution partner.  Financial details were not disclosed. (Pet Product News) 
> INDIA   DSM announced the opening of its first animal nutrition and health premix plant in India. The new facility allows the company to directly provide products and concepts to its customers in the Indian sub-continent. The new DSM plant will provide feed premixes under the brand name Rovimix. (Animal Pharm) 
> KOREA – AVIAN INFLUENZA   South Korea confirmed two additional avian influenza (AI) outbreaks. Tests showed 30,000 birds at an egg-laying chicken farm 100 kilometers southeast of Seoul were infected with the virulent H5N1 strain of AI; about 1,000 ducks found dead at a duck farm last week about 350 kilometers south of Seoul were confirmed Saturday to have been infected with the H5A1 strain of AI. (Meating Place)
> US – BOVINE TB   Bovine tuberculosis has been confirmed in a beef cattle herd in Indiana, the state’s first such case in cattle in more than three decades. The disease was found in a cow tested during slaughter at a meat processing plant; the agency is now testing the rest of the Indiana herd. (Chicago Tribune)
> US – ANIMAL HEALTH RESEARCH   The Kansas Bioscience Authority approved spending $1 million in seed money to establish a public-private consortium called the National Center of Animal Health Innovation. The Center of Innovation will bring nine area animal health companies, plus regional universities and government agencies together to accelerate job creation, research, development and commercialization of the next generation of animal health and nutrition products. (association press release)
There were a number of positive stories this week.  The final 2010 reports for revenues and profits are now nearly complete.  The past year will go down as a positive year, with revenue growth of about 8% over 2009.  Now we face the challenges of 2011, we continue to believe that growth in 2011 is likely to be negatively impacted by increased feed grain and fuel costs.  As pointed out in our industry overview we believe that $4.00 gas and higher food prices will put pressure on consumer and pet owner spending.
The past couple of days I’ve been in Kansas City, visiting clients and attending the One Health Biomanufacturing Summit organized by the Kansas BioScience Authority organization.   It was a great meeting with some very interesting presentations.  During the conference, special presentations and information were presented on the new National Center of Animal Health Center Innovation to be established in the Kansas City area.  This new center, when fully organized and staffed, will provide services that will increase innovation in the animal health industry.  Congratulations to the steering committee for their vision and to Kansas BioScience Authority for providing the initial funding. 
Have a great weekend now that it’s starting to feel like spring in some parts of the US.
Ron Brakke

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