Animal Health News & Notes for August 3, 2018
Copyright © Brakke Consulting, Inc.
Editor: Lynn Fondon DVM MBA
IN THE NEWS:
Brakke Consulting news
Central Garden & Pet
Alivira Animal Health
B. Braun Vet Care
Bayer – Baytril Soft Chews
Bayer – Tri-Solfen
Elanco – IPO
Elanco – Posilac
Elanco – Percorten
Neogen – Japan
Neogen – Clarus Labs
Piedmont – Baytril Soft Chews
Piedmont – Perrigo
Toto Pet Insurance
2018 KC Animal Health Corridor Events
August 20-21, 2018
Kansas City, MO
Market Insight Seminar
August 20, 3:00 – 5:00 pm
Join fellow animal health leaders in Kansas City this August for the 3rd annual KC Animal Health Corridor Market Insight Seminar. All registration proceeds will be donated to Kansas State Animal Response Team (KS SART) and KSDS Assistance Dogs, Inc.
Animal Health Corridor Homecoming Dinner
August 20, 5:00 – 9:00 pm
The KC Animal Health Corridor’s annual Homecoming Dinner is an exclusive gathering of industry leaders from around the world to celebrate global industry successes and growth.
Animal Health Investment Forum
August 21, 7:30 am – 6:00 pm
The KC Animal Health Investment Forum is one of the only opportunities in the world for early stage animal health companies to present their vision and business plan to potential investors.
For details, go to http://kcanimalhealth.thinkkc.com/events/annual-events
COMPANY EARNINGS RELEASES
• Boehringer Ingelheim reported results for the first half of 2018. Animal Health generated around EUR 2 billion ($2.3 billion) of net sales, which corresponds to a currency-adjusted increase in the mid-single-digit range. (company website)
• Zoetis Inc. reported its financial results for the second quarter of 2018. The company reported revenue of $1.4 billion, an increase of 12% compared with the second quarter of 2017. Net income was $384 million, an increase of 55%. (company press release)
• Merck announced financial results for the second quarter of 2018. Animal Health sales totaled $1.1 billion for the second quarter of 2018, an increase of 14% compared with the second quarter of 2017, including a 2% positive impact from foreign exchange. Animal Health segment profits were $450 million in the second quarter of 2018, an increase of 14%. (company press release)
• Vetoquinol reported results for the second quarter of 2018. Sales were EUR 90.3 million ($105 million), stable as compared to the same period in 2017 (up 3.7% like-for-like). (company website)
• IDEXX Laboratories reported results for the second quarter of 2018. Revenues were $581 million, an increase of 14% compared to the prior year period. Net income was $108.7 million, a 27% increase compared to the prior year period. Companion Animal Group revenues were $507 million, an increase of 15% compared to the prior year period. (company press release)
• Colgate-Palmolive Company reported results for the second quarter of 2018. Hill’s Pet Nutrition recorded net sales of $592 million, an increase of 3.5% compared to the second quarter of 2017. (company press release)
• Nestle SA reported results for the first half of 2018. Petcare sales were CHF 6,176 million ($6,217 million), an increase of 3% compared to the first half of 2017. (company website)
• Aratana Therapeutics, Inc. announced its second quarter 2018 financial results. Aratana reported total net revenues of $4.9 million compared to $5.2 million in net revenues in the second quarter of 2017. The quarterly net loss was $(6.4) million compared to a net loss of $(10.4) for the corresponding quarter of 2017. (company press release)
• Central Garden & Pet Company announced financial results for its fiscal 2018 third quarter ended June 30, 2018. Net sales for the Pet segment increased 13% to $355 million from the same period a year ago, driven almost equally by higher organic Pet sales, which increased 6.6%, and the acquisition of General Pet, which closed in early April. (company press release)
• Spectrum Brands Holdings, Inc. reported results from continuing operations for the third quarter of fiscal 2018 ended June 30, 2018. Sales for the pet segment were $195 million, an increase of 3% comparted to the comparable prior-year quarter. (company website)
• Krka reported results for the first half of 2018. Sales of animal health products in H1 were EUR 35.2 million ($41.2 million), an increase of 1% compared to the first half of 2017. (Animal Pharm)
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COMPANY NEWS RELEASES
• Zoetis Inc. announced the completion of the acquisition of Abaxis for $83 per share in cash, or approximately $2.0 billion in aggregate. (company press release)
• Eli Lilly and Company announced that its subsidiary, Elanco Animal Health, has filed a registration statement with the U.S. Securities and Exchange Commission (SEC) for an initial public offering (IPO) of common stock. The offering is expected to represent an ownership stake of less than 20% in Elanco. The number of shares to be offered and the price range for the offering have not yet been determined. The company expects to complete the IPO process before the end of 2018. (PRNewswire)
• Union Agener, one of Brazil’s largest animal health companies, announced it will acquire Elanco Animal Health’s Posilac business. The deal also will include Elanco’s Posilac manufacturing facility in Augusta, Georgia. Elanco will continue to support and distribute Posilac in currently served markets for a transitional period. The purchase price was not disclosed. (Feedstuffs)
• The US FDA has reported that there is a shortage of Elanco’s Percorten-V (desoxycorticosterone pivalate injectable suspension) for the treatment of Addison’s disease (primary adrenocortical insufficiency) due to manufacturing delays. The agency said veterinarians can use Dechra Pharmaceuticals’ Zycortal Suspension – also approved for the treatment of Canine Addison’s disease – as an alternative. (FDA)
• Piedmont Animal Health and Bayer Animal Health announced that the FDA has approved Baytril (enrofloxacin) Soft Chew Tablets. (Animal Pharm)
• Piedmont Animal Health announced an agreement with Perrigo to develop several new animal drug applications (NADAs) and generic drugs for companion animals. Perrigo will commercialize the products. (Animal Pharm)
• Norbrook Laboratories announced the FDA approval for the addition of the use of Enroflox 100 (enrofloxacin) via intramuscular injection (IM) in swine, as well as claims for treating additional bacteria. Enroflox 100 now provides swine veterinarians and producers the same active ingredient, dosing regimen and covers the same swine pathogens on the current Baytril 100 label. (company press release)
• Parnell Pharmaceuticals announced it has entered into a $32 million credit agreement with Marathon Asset Management to refinance its current outstanding debt, pay transaction expenses and support working capital. The company will also use the proceeds to stoke growth in the food production animal sector. (Animal Pharm)
• Neogen Corporation announced that it has acquired Clarus Labs, Inc. The acquisition includes the patented Colitag water test, which detects dangerous coliform bacteria, including E. coli, in water. Financial terms were not disclosed. (company press release)
• Pfizer, a leading manufacturer of injectable opioids, has suspended sales and delivery of the drugs to veterinary customers, citing the need to prioritize shipments to hospital and surgical trading partners. The company has been grappling with a supply shortage caused by multiple manufacturing problems since 2017, and does not anticipate fully recovering from the shortage until the second quarter of 2019, at which time it will resume selling to the veterinary market. (VIN News)
• CP Medical announced an agreement to market and distribute B. Braun Vet Care’s veterinary infusion therapy product line and certain products from its wound therapy line in the US and Canada. (company press release)
• Toto Pet Insurance was launched this month. Licensed in 30 states, the company offers basic policies covering accidents, illnesses and prescriptions. Toto policies are underwritten by Independence American Insurance Co. and administered by PetPartners Inc., the provider of AKC and CFA pet insurance. (Todays Veterinary Business)
• NEW ZEALAND Bayer and Animal Ethics announced a long-term, exclusive agreement in New Zealand. Bayer will market existing and future indications of Tri-Solfen analgesic for all animal species in New Zealand; Animal Ethics will remain responsible for adding extra indications that are currently in the pipeline. Tri-Solfen is currently registered in New Zealand for use on lambs and calves undergoing husbandry procedures. (Animal Pharm)
• INDIA Nutramax Laboratories and Vivaldis announced an agreement for Vivaldis to market Nutramax Labs products in India. The first Nutramax product being launched is Denamarin. (PRNewswire)
• TURKEY Alivira Animal Health announced that it received EU GMP approval from Bulgarian authority’s for its manufacturing unit in Ankara, Turkey. With this approval, Alivira now has 4 EU GMP certified manufacturing units, with one each in Turkey, Spain, Germany & India. (company press release)
• GERMANY MorphoSys announced it has spun out adivo – a fully independent business specializing in developing monoclonal antibodies for companion animals. The start-up is focused solely on developing species-specific monoclonal antibodies from large antibody libraries, using a technology called phage display. (Animal Pharm)
• JAPAN FeedOne announced an agreement with Neogen and Alta Japan to begin offering genomic analysis services to its dairy cattle customers. Financial terms were not disclosed. (Animal Pharm)
ANIMAL HEALTH NEWS
• US – CONTAMINATED FEED The FDA is investigating horse feed from Gilman Co-Op Creamery in Gilman, MN that contained monensin, an animal drug highly toxic to horses, even at low levels. To date, six horses from the same owner have died after eating a single batch of feed. While the feed was a special order for the farm and not distributed to other farms, the FDA is issuing this notice to make feed manufacturers and horse owners aware that monensin in horse feed continues to be a concern. (FDA)
• US – FELINE ANESTHESIA The American Association of Feline Practitioners (AAFP) has published the first feline-specific anesthesia guidelines in the Journal of Feline Medicine and Surgery. The AAFP recommends that these guidelines, which are endorsed by the International Society of Feline Medicine, be used in conjunction with other previously published guidelines. The guidelines and associated supplemental resources are available for download at https://www.catvets.com/guidelines/practice-guidelines/anesthesia-guidelines. (Veterinary Practice News)
BRAKKE CONSULTING VIEWPOINT
Wow!! What a second quarter for some of the larger companies serving the industry. When a company’s growth for the quarter and the first 6 months of the year is in the double digits, you are having a great year when compared with the growth of the market in prior years.
These positive revenue performances indicate that large companies can have outstanding grow both in dollars and percentage that are equal to or even better than the growth of smaller companies serving the industry. Yes, critical mass does matter if it is managed and leveraged properly particularly in the research and development area. One of the reasons for the double digit growth in these companies is the contributions of new innovative products that were developed in the research department or were acquired from smaller innovative companies.
It now appears to us that the revenue growth rate for the industry for full 2018 could reach the seven or eight percent range. This financial success in 2018 should lead to further increases in research and development funding which will result in additional new technology and products in future coming years.
Have a great weekend!
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