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Brakke Consulting’s
Animal Health News & Notes for August 9, 2019
Copyright © Brakke Consulting
Editor: Lynn Fondon DVM MBA
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IN THE NEWS:
Brakke Consulting news
NEW! Animal Health stock price tracker
Market research services
earnings news
ECO Animal Health
Heska
MWI Animal Health
Ouro Fino
PetIQ
Pets at Home
Pilgrim’s Pride
Spectrum Brands
Zoetis
other news
Akston Biosciences
BabelBark
Bayer
Bought By Many
Dechra
Elanco
FirstVet
Hill’s
Gallant Pet
Global Veterinary Partners
K-Laser USA
Kane Biotech
PBD Biotech
Pestell Group
Petco (vet clinic partnerships)
Petco (Pet Wellness Council)
Pro-Ag Products
Sanderson Farms
Summus Medical Laser
Verus Animal Nutrition
VetnCare
VitalPet
Volition Veterinary Diagnostics Development
Wind Point Partners
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BRAKKE CONSULTING
MARKET RESEARCH SERVICES
Look Before You Leap
Depend on Brakke Consulting to meet your company’s market research needs, whether it is:
• Assessing the feasibility of a new product or technology
• Identifying the opinions and trends of veterinarians, pet owners or producers
• Determining the current market for products
With our in-house database of veterinarians and the ability to custom-tailor surveys of a wide variety of target audiences, we provide reliable insights into this unique industry. We also produce multiclient reports in a number of high-interest animal health market areas. For more information, see our website or call us at 336-396-3916.
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COMPANY EARNINGS RELEASES
• Zoetis Inc. reported its financial results for the second quarter of 2019. The company reported revenue of $1.547 billion, an increase of 9% compared with the second quarter of 2018 (+14% excluding the impact of foreign currency). Net income was $371 million, a decrease of 3%. Revenue in the US segment was $780 million, an increase of 15% compared with the second quarter of 2018. (company press release)
• AmerisourceBergen reported results for its fiscal third quarter ended June 30, 2019. Revenues for MWI Animal Health were $1.02 billion, an increase of 8% compared to the comparable prior-year quarter. (company website)
• Ouro Fino Saúde Animal reported results for the second quarter of 2019. Sales were R$177.7 million ($44.8 million), an increase of 10% compared to the prior-year quarter. Adjusted EBITDA for the second quarter was R$34.6 million ($8.7 million), compared to R$40.7 million last year. (Animal Pharm)
• Heska Corporation reported financial results for its second quarter ended June 30, 2019. Revenue was $28 million, a 5% decrease from the second quarter of 2018. Net loss attributable to Heska Corporation was $(0.2) million compared to income of $1.9 million in the second quarter of 2018. (company website)
• ECO Animal Health reported results for the fiscal year ended March 31, 2019. Revenue was EUR 74.6 million ($85 million), an increase of 11% compared to the prior year. Net profit was EUR 13.6 million ($15.5 million), an increase of 16%. (company website)
• PetIQ, Inc. reported financial results for the second quarter of 2019. Net sales increased 29% to $221 million. Product segment net sales were $195 million and Services segment revenues were $26 million. Net income was $5.9 million compared to net income of $5.4 million in the comparable prior-year period. (company press release)
• Spectrum Brands reported results for its fiscal third quarter ended June 30, 2019. Net sales for the Global Pet Care segment were $222 million, a 14% increase compared to the prior-year quarter (+16% excluding unfavorable foreign exchange). (company website)
• Pilgrim’s Pride Corporation reported second quarter 2019 financial results. Net sales were $2.84 billion, up slightly from the same period in 2018. (Feedstuffs)
• Pets at Home Group plc reported results for the 16 weeks ended July 19, 2019. Group revenue was up 10% to GBP 303 million ($368 million). (GlobalPets)
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2019 KC Animal Health Corridor Events
August 26-27, 2019
Kansas City, MO
Market Insight Seminar
August 26, 3:00 – 5:00 pm
Join fellow animal health leaders in Kansas City this August for the 4th annual KC Animal Health Corridor Market Insight Seminar. All registration proceeds will be donated to New Horizon Ranch and Rose Brooks Center.
Animal Health Corridor Homecoming Dinner
August 26, 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 27, 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
REGISTER NOW for Early Bird Pricing: https://www.eventbrite.com/e/2019-annual-kc-animal-health-corridor-events-tickets-61435035846
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COMPANY NEWS RELEASES
• According to Bloomberg News, Elanco Animal Health reportedly may reach an agreement as soon as next week to combine with Bayer AG’s animal-health unit. Elanco reportedly plans to pay at least part of the acquisition cost using stock. The companies are said to be hoping to announce a deal around the time of Elanco’s Aug. 13 earnings release. (Bloomberg)
• Dechra Pharmaceuticals announced a licensing and supply agreement with Akston Biosciences for a treatment for diabetes in dogs. The deal includes an initial payment of $2 million, with a further $14 million in milestone payments during the development process, which should be completed within five years. Dechra also has the option to license a version for cats. (company press release)
• Hill’s Pet Nutrition announced the launch of new range of five dog treats. The range consists of: Healthy Weight Treats to support healthy weight loss and maintenance; Soft Baked Biscuits to help support vital organs; Healthy Mobility Treats to promote healthy mobility; HypoAllergenic Treats for dogs with food sensitivities; and Dental Care Chews to help reduce plaque and tartar. (Pet Gazette)
• Wind Point Partners and portfolio company Pestell Group announced that Pestell has acquired Pro-Ag Products and Verus Animal Nutrition through its Pestell Minerals & Ingredients (PMI) business unit. Pro-Ag is a distributor of feed ingredients, feed additives and animal health products, while Verus provides performance animal nutrition products; the businesses operate as one entity. Financial terms were not disclosed. (Feedstuffs)
• K-Laser USA, a manufacturer of non-surgical laser devices to both veterinary and human medicine practitioners, announced a name change to Summus Medical Laser. (Todays Veterinary Business)
• PBD Biotech has gained a US patent for Actiphage, a rapid blood test for bovine tuberculosis (bTB). The company is working with the Colorado Department of Agriculture’s Animal Health Laboratory on a pilot study to determine the accuracy of the firm’s diagnostic in detecting bTB at a very early stage. (Animal Pharm)
• Petco announced the addition of three new regional veterinary partners: Global Veterinary Partners (GVP), based out of Florida; VitalPet, based out of Texas; and VetnCare, based out of California. With these partnerships, Petco says it will more than double its count of full-service in-store vet hospitals — with hospitals in 21 states — by the end of 2019. (Yahoo Finance)
• Petco announced the formation of the Petco Pet Wellness Council. The 8-member Council – which includes 7 veterinarians and one Ph.D. – will serve as an external source of advice for both the specialty retailer and the veterinary industry as a whole. (Veterinary Practice News)
• VolitionRx Limited, a company developing blood tests based on identifying and measuring nucleosomes in the bloodstream or other bodily fluids, announced the recent formation of Volition Veterinary Diagnostics Development LLC, to develop and commercialize the company’s Nu.Q Vet products. Volition previously announced the execution of a Memorandum of Understanding with Texas A&M University with the intention to collaborate on the research and development of veterinary diagnostic products. (PRNewswire)
• A federal judge has tossed out a false advertising lawsuit that challenged Sanderson Farms’ use of ‘100% natural’ claims on its poultry products, saying that the environmental groups who filed the suit – the Center for Food Safety and Friends of the Earth – lacked standing. The complaint alleged that Sanderson’s advertising and marketing deliberately confuses consumers into believing the company does not use antibiotics in the raising of its chickens. (Animal Pharm)
• BabelBark, Inc., announced the launch of fully integrated two-way pet journaling in its BabelVet, BizBark and BabelBark apps. (company press release)
• Gallant Pet Inc., a company offering stem cell storage banks for canines, announced it has raised $7 million in a funding round. Gallant Pet cryogenically preserves canine stem cells extracted by veterinarians when the dog is spayed or neutered and place them in storage for “future regenerative treatment.” (AVMA SmartBrief – LABusinessjournal.com)
• CANADA Kane Biotech Inc. announced that they have been awarded funding from Western Economic Diversification Canada in the amount of C$3,792,984, the total amount for which the company applied for. The funding will be used to assist Kane in expanding from the Animal Health sector into the Human Health sector with its DispersinB wound care product. (company press release)
• UK FirstVet, a UK online veterinary consultation provider, announced it has joined forces with Bought By Many, a pet insurer to bring Bought by Many customers access to free video consultations with UK-registered veterinary surgeons via the FirstVet app. (Vetsurgeon.org)
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ANIMAL HEALTH STOCK PRICE TRACKER
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ANIMAL HEALTH NEWS
• US – VESICULAR STOMATITIS Outbreaks of vesicular stomatitis (VS) virus in the US have continued to worsen in recent weeks, with 512 VS virus-affected premises in 5 states: Texas, New Mexico, Colorado, Wyoming, and Oklahoma. Out of the total premises identified so far, all but two have only equine species clinically affected. (Animal Pharm)
• US – WITHDRAWAL PERIODS The FDA is requesting public comment on several key issues aimed at ensuring that its procedures for assigning withdrawal periods for animal drugs intended for use in food-producing animals adequately take into consideration current industry practices. The agency is requesting public input on: (1) industry practices regarding how long it takes to transport certain food producing animals from production facilities to slaughter facilities; (2) how frequently dairy animals are milked; and (3) how end users, such as animal producers or veterinarians, interpret animal drug labeling that states the drug has a “zero-day withdrawal period” or “zero-day milk discard time. For more information, go to https://www.fda.gov/animal-veterinary/cvm-updates/fda-requests-comments-transit-times-slaughter-facilities-milking-frequency-and-interpretation-zero?utm_campaign=8-8-2019-WithdrawalTimes&utm_medium=email&utm_source=Eloqua. (FDA)
• CHINA – TRADE BAN The Chinese government has sent out directives for state-owned agricultural companies not to buy from US suppliers. The Chinese move is an apparent retaliation to an announcement by the US president to increase taxes for $300 million worth of products with 10% extra, as from September 1. (Pig Progress)
• JAPAN – BOVINE LEUKEMIA RESEARCH Scientists at Hokkaido University in Japan have succeeded in reducing levels of the bovine leukemia virus (BLV) in cows with severe infections by combining an immune checkpoint inhibitor (anti-PD-L1 antibody) and an enzyme (COX-2) inhibitor. The research was published in The Journal of Immunology. (Feedstuffs)
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BRAKKE CONSULTING VIEWPOINT
Perhaps it is just a coincidence that we have included a new stock tracking feature in our Animal Health News & Notes newsletter as companies continue report quarterly results this week. The publicly traded “pure-play” animal health companies now are more than just a few and we thought you’d like to see how they are doing on a more regular basis.
There are a significant number animal health and nutrition businesses that are a part of a larger pharmaceutical or consumer packaged goods business but tracking these stock prices doesn’t necessarily reflect the performance of the animal side of the business. We’ll still track those quarterly, but for now, we’ll not include them on our list.
We’ve also included the first Exchange Traded Fund that tracks the pet business – maybe you haven’t seen this before. This is the ProShares Pet Care ETF and goes by the symbol PAWZ. It started in November of last year and while some may think it is just another niche ETF, It is the only one that caters to the pet care industry that so many of our readers are personally interested and invested in.
We have all heard and should believe that “you can’t manage what you don’t measure” and we are now able to measure company performance regularly. We hope you like this new inclusion to News & Notes. Let me know if we can make this better.
Bob Jones
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