The Experts in Animal Health

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Brakke Consulting’s
Animal Health News & Notes for June 5, 2009

Copyright © Brakke Consulting, Inc.

Editor: Lynn Fondon, DVM, MBA

earnings news
KMG Chemicals

other news
Classic Medical Supply
P&G PetCare
Pulse Veterinary Technologies
Royal Pet Supplies
Universal Ultrasound

The U.S. Animal Health Industry:
Its pioneers and their legacy of innovation

Brakke Consulting is pleased to announce the imminent publication of an all-new book chronicling the history of the animal health industry in the US. This professionally produced 108-page hardcover book traces the evolution of the industry, from its beginnings in the late 19th century battling hog cholera to today’s $5 billion industry.

Don’t miss the opportunity to own this unique look at our industry. Orders placed by Friday, June 19 will receive the early-order price of $24.50 plus shipping.  For more information, contact Jane Morgan at or 972.243.4033.


> KMG Chemicals, Inc. announced financial results for the third quarter and nine months ended April 30, 2009. Animal Health contributed $3.5 million to third-quarter revenues, compared to $4.0 million in the comparable period in the prior year. (GlobeNewswire)


> Merck & Co. has started contacting potential buyers for parts of its Merial animal health business as it determines what to sell after its planned $41 billion acquisition of Schering-Plough Corp., according to the Wall Street Journal.  In recent days, Merck has circulated information on two assets: its 50% stake in the Merial joint venture, and Schering-Plough’s animal-health business, Intervet Schering-Plough Animal Health. (Wall Street Journal)

> Pfizer Animal Health announced that the FDA has approved Palladia, the first canine cancer therapy in the US.  Palladia (toceranib phosphate) was developed by Pfizer to treat mast cell tumors in dogs. Palladia, an oral therapy indicated to treat recurrent cutaneous mast cell tumors with or without regional lymph node involvement, belongs to the tyrosine kinase inhibitor (TKI) class of compounds. (Business Wire)

> Novartis Animal Health announced a $1.3-million contract with the Atlantic Veterinary College at the University of Prince Edward Island to fund a Chair of Fish Health, expanding the company’s aquaculture focus and paving the way for innovative developments in fish health for the growing aquaculture industry. Over the course of five years, the funding will be portioned to fund research and cover the salary and benefits of the Chair of Fish Health. (KSU Bites – The Guardian)

> Virbac Animal Health and Orion Corporation announced a partnership focused on developing a product to manage cardiovascular disease in senior pets. Terms were not disclosed. (company press release)

> Neogen Corporation announced that its Scotland-based European subsidiary has signed a partnership agreement with the Chinese government to research China-specific food safety and plant health issues. The partnership agreement created a jointly funded laboratory in Beijing. (company press release)

> Dechra Veterinary Products and ANOxA announced a licensing agreement for ANOxA’s patented EIPHiSOL technology for the control of exercise induced pulmonary hemorrhage in performance horses.  Under the agreement, Dechra will conduct studies required for regulatory filings and final governmental approvals in the US and other key countries.  The agreement also grants Dechra exclusive worldwide rights for the sale and distribution of EIPHiSOL. (company press release)

> P&G Petcare announced it will move its North American Pet Care operations from Dayton, Ohio to Mason, Ohio. These operations will now become part of Procter & Gamble’s Mason Business Center, where the company’s oral care, personal health and pharmaceuticals business are also based. (PETS International)

> Adisseo announced that it is investing EUR 25 million to increase methionine production by 25,000 tons at its French and Spanish plants. The decision is part of the company’s proactive policy to support the continuous growth of global demand for methionine, an essential amino acid for livestock feeding, especially for poultry. (Feedstuffs)

> ANTECH Diagnostics announced the availability of a molecular diagnostic test for the five most common viral and bacterial causes of feline upper respiratory disease. The FastPanel PCR Feline Upper Respiratory Profile tests for feline calicivirus, feline herpesvirus-1, Bordetella bronchiseptica, Chlamydophila felis and Mycoplasma felis.  Requiring only a single sample, FastPanel PCR test results are available in just 1-3 days. (company press release)

> Universal Ultrasound announced it has merged operations with Classic Medical Supply. Universal Ultrasound has served the veterinary industry for over 35 years; Classic Medical was founded in 1985. Financial terms were not disclosed. (ALN Magazine)

> Pulse Veterinary Technologies, LLC, announced the acquisition of the veterinary business of Sanuwave, Inc. The purchase includes the VersaTron family of pulsed energy therapeutic products for the non-invasive management of musculoskeletal disorders causing chronic pain and lameness in veterinary patients, primarily horses and dogs. The transaction was sponsored by Integris, LLC, with Topspin Partners LBO, LP as the principal investor. Financial terms were not disclosed. (

> Royal Pet Supplies announced it has been acquired by private equity firm Quarry Capital Management.  Financial terms were not disclosed. (Pet Age)

> CANADA   Eklin Medical Systems announced it has signed a Canadian distribution agreement with AVENTIX Animal Health Corp. AVENTIX will distribute the Eklin Digital Practice, including ultrasound, DR and PACS products, throughout Canada. (PRNewswire)


> US – BOVINE TB  The Nebraska Department of Agriculture (NDA) and the USDA have discovered a herd of beef cattle in the Rock County, Nebraska area that have tested positive for Tuberculosis (TB).  NDA and USDA are currently in the process of working with the producer, who has been cooperating with the two agencies. The herd, which is under quarantine, is undergoing herd testing and an epidemiological investigation (KSU Bites)

> BSE TRADE RULES   The World Organization for Animal Health (OIE) adopted a resolution eliminating the cattle age limits related to preventing BSE in international beef trade. Under former OIE standards, beef exports and imports had been restricted to boneless beef from cattle younger than 30 months old. The new resolution allows exports and imports of boneless beef from cattle of all ages. (Meating Place)

> US – FELINE SENIOR CARE GUIDELINES   The American Association of Feline Practitioners (AAFP) unveiled new Senior Care Guidelines for cats. The guidelines address complex disease management, pre-emptive testing, nutrition and a host of other areas to help practitioners when treating senior cats. The guidelines can be found at . (DVM Newsmagazine)

>  US – ANTIBIOTIC LEGISLATION   Proposed California legislation that would have limited the use of antibiotics by licensed veterinarians to prevent and control disease in animal agriculture was defeated by the California Senate. SB 416 was amended earlier this month by the Senate Education Committee to require school districts to make every effort to purchase poultry and meat products that have not been treated with non-therapeutic antibiotics. The original bill prohibited schools from serving poultry or meat products from animals that had been treated with antibiotics at any time during the life of the animal. (Feedstuffs)


The first annual Animal Health Investment Forum will be held Tuesday, September 1, in Kansas City, Missouri. This forum offers the only opportunity in the world for companies exclusively in the animal health sector to present their vision and business plan to potential investors. Because of its industry concentration, the KC Animal Health Corridor offers a uniquely supportive environment for start-up and early stage entrepreneurs in the animal health industry. Visit to learn more or to register to attend.


Our sole earnings report this week reflects what we feel will be a tough year for the farmed livestock segment.  The rest of the news is encouraging.  With the base business likely to be flat at best, managers in the animal health companies are busy with new products, alliances, distribution agreements and even a merger.  This kind of activity is crucial to the long term vibrancy of the industry.

The blockbuster news from Merck is also positive.  The valuations on the businesses it is auctioning reflect high sales multiples.  And the fact that the Intervet/Schering-Plough Animal Health will likely not become part of Merial has to be a relief to those in the distribution business.

Have a good weekend.

John Mannhaupt

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