Animal Health News & Notes for March 5, 2021

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Brakke Consulting’s
Animal Health News & Notes for March 5, 2021
Copyright © Brakke Consulting
Editor: Lynn Fondon DVM MBA
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IN THE NEWS:

Brakke Consulting News
Pain Management Products report – last week for early-order discount

Earnings News
Avivagen
Bioveta
Covetrus
Cryoport
Fressnapf Group
Patterson
PetIQ
Zomedica

Other News
ADM Animal Nutrition
Atomation
Biomin
Butterfly Network
Cambrian Pet Foods
CERES Natural Remedies
Chanelle Pharmaceuticals Manufacturing
Creso Pharma
Elanco (Seresto)
Elanco (Virbac)
Elanco (Experior)
Elanco (Nuplura)
FERA Diagnostics and Biologicals
Fi
Grizzly Pet Products
Heska
Hippo Manager
Huvepharma
Longview Acquisition Corp
Merck
NAVC
Petriage
Pharmgate
PoultrySense
Revelstoke Capital Partners
Sirona Biochem
Summit SmartFarms
Trouw Nutrition
United Petfood
Veramaris
Vet’s Best Friend
Virbac
Whitebridge Pet Brands
Zoetis

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BRAKKE CONSULTING
2021 PAIN MANAGEMENT PRODUCTS FOR DOGS AND CATS
LAST WEEK FOR EARLY-ORDER DISCOUNT

Pain management is one of the leading topics in veterinary medicine today. Brakke Consulting’s annual report on Pain Management Products for Dogs and Cats includes such valuable information as:
– overview of acute and chronic pain in small animals
– discussion of the impact of the human opioid crisis on veterinary use of opioids
– review of new products, including performance of deracoxib generics
– estimates of US sales and prices of leading products
– pain management products in development, including monoclonal antibody products LIBRELA and SOLENSIA
– review of nutritional supplements used for chronic pain
– review of therapeutic diets for joint care
– discussion of the use of cannabinoids in veterinary pain management
– 2021 survey of 340 small animal veterinarians regarding use of pain management products

Pain Management Products for Dogs and Cats 2021 can be purchased for $5,500 if ordered by March 12, 2021, and $5,950 thereafter. The report will be completed in late March. Questions about the study can be answered by project manager Lynn Fondon, DVM, MBA at Lfondon@brakkeconsulting.com.

www.BrakkeConsulting.com

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COMPANY EARNINGS RELEASES

• Covetrus reported financial results for the full-year 2020. Net sales were $4.3 billion, an increase of 9% (Non-GAAP pro forma organic net sales +10%). Net loss attributable to Covetrus was $(19) million compared to a loss of $(980) million in the prior year. The primary driver of the year-over-year improvement was the $938 million goodwill impairment charge recorded in the prior year and an after-tax gain on the sale of scil animal care during the second quarter of 2020. North America net sales for the year were $2.4 billion, an increase of 13% compared to the prior year. (company press release)
• Patterson Companies, Inc. reported results for its fiscal third quarter ended January 23, 2021. Reported net sales in the Animal Health segment were $894 million, an increase of 9% compared to the third quarter of last year. Internal sales for the segment increased 10% with companion animal posting internal sales growth of 21% compared to the same period one year ago. (Business wire)
• PetIQ, Inc. reported financial results for the twelve months ended December 31, 2020. Net sales were $780 million, an increase of 10% compared to 2019. Product segment net sales increased 18% to $726 million. Net loss was $(81.0) million compared to a net loss of $(14.3) million in 2019, primarily due to incremental expenses related to the Capstar acquisition and a $52.2 million non-cash tax expense. (company press release)
• Czech firm Bioveta announced financial results for 2020. Revenues climbed 12% to CZK 2,079 million ($97 million) fueled by export revenues from the firm’s vaccines for pets and food-producing animals. (IHS Markit Connect)
• Zomedica reported results for the full year 2020. Net loss in 2020 totaled $(16.9) million, compared to a loss of around $(19.8) million in 2019. As of December 31, 2020, Zomedica had cash and cash equivalents of $62 million compared to cash of $0.5 million at the end of 2019; as of February 26, 2021, Zomedica had cash of approximately $277.5 million following a share offering earlier this year. (IHS Markit Connect)
• Avivagen announced its unaudited financial results for the first fiscal quarter ended January 31, 2021. The Company reported revenues of C$261,987 (US$207,000), an increase of 6% compared to the quarter ending January 31, 2020.  Comprehensive loss was C$(1,266,300) (US$1 million) for the quarter, compared to a comprehensive loss in the quarter ending January 31, 2020 of C$(1,331,780). (company press release)
• The Fressnapf Group reported results for the full year 2002. Total annual sales were EUR 2.65 billion ($3.25 billion), an increase of 15% compared to the previous year. (GlobalPets)
• Cryoport reported financial results for 2020. The firm – which specializes in temperature-controlled supply chain solutions – reported annual animal health turnover $7.8 million, up from $1 million in 2019 primarily driven by its acquisition of MVE Biological Solutions last year. (IHS Markit Connect)

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COMPANY NEWS RELEASES

• Merck Animal Health announced the completion of its acquisition of PrognostiX Poultry Limited d/b/a Poultry Sense Ltd. from its founding shareholders. Poultry Sense Ltd. is an innovator in health and environmental monitoring solutions for the poultry industry. Merck had invested in Poultry Sense Ltd. In March 2019, to support their development. Specific terms of the agreement were not disclosed. (company press release)
• Virbac announced it has acquired has acquired the global rights to the Itrafungol and Clomicalm brands from Elanco, as well as early-stage R&D projects related to the development of new companion animal parasiticides. The two pet products have combined annual sales of EUR 11 million ($13.2 million). Financial terms were not disclosed. (IHS Markit Connect)
• A report in USA Today links Elanco‘s Seresto flea collar to “hundreds of pet deaths, tens of thousands of injured animals and hundreds of harmed humans” based on EPA documents obtained through a public records request made by EPA watchdog the Center for Biological Diversity. Elanco disputes the substance of the report, stating that the incidence of adverse events reported is less than 0.3% of all collars sold since 2012, and a significant majority relate to non-serious effects such as application site disorders.” (USA Today, company announcement)
• According to Barclays, a district judge has allowed animal welfare, environmental and food safety advocates to challenge the FDA’s approval of Elanco‘s Experior (lubabegron Type A medicated article), a potential blockbuster drug that reduces gas emissions from cattle. Elanco has said it plans to launch Experior by the end of the first quarter of 2021. (SeekingAlpha.com)
• Elanco announced the launch of NUPLURA PH+, a cattle vaccine for protection against Mannheimia haemolytica and common viral causes of BRD including BVD Types 1 and 2 and IBR. (Bovine Vet)
• The FDA announced the approval of Chanelle Pharmaceuticals Manufacturing’s Animec Plus (generic ivermectin and clorsulon) for use in cattle. (FDA)
• The FDA announced the approval of several Huvepharma Type A generic medicated feed articles for use in heifers fed in confinements for slaughter: CycleGuard (melengestrol acetate) and Monovet (monensin); Optigrid (ractopamine) and CycleGuard and Monovet; CycleGuard and Monovet and Tylovet (tylosin); and Optigrid and Monovet and Tylovet and CycleGuard. (FDA)
• Heska Corporation announced that it has commenced an underwritten public offering of common stock at a price to the public of $186.00 per share, for gross proceeds of approximately $175 million. In addition, Heska expects to grant the underwriters a 30-day option to purchase up to an additional 15% of the shares of common stock sold in the offering at the public offering price, less the underwriting discounts and commissions. (company press release)
• The FDA announced the approval of Pharmgate’s Penntracin MD (bacitracin) and Coban (monensin) Type A medicated articles for use in the manufacture of Type C medicated feeds for growing turkeys. (FDA)
• Trouw Nutrition, the animal nutrition division of Nutreco, announced that it has completed the acquisition of a plant in Southern Texas from ADM Animal Nutrition. Trouw Nutrition USA is purchasing and integrating the plant into its Hi-Pro feeds organization. Financial terms were not disclosed. (Feedstuffs)
• Veramaris announced that the FDA’s Center of Veterinary Medicine (CVM) has awarded a Generally Recognized as Safe (GRAS) approval for Veramaris Pets natural marine algal oil in cat food, providing the pet food industry with a new, sustainable source of Omega-3 fatty acids. Veramaris previously received GRAS designation for the product in dog food. (company press release)
• Butterfly Network, Inc., maker of the Butterfly iQ Vet portable ultrasound, announced that it has completed its business combination with Longview Acquisition Corp., a special purpose acquisition company sponsored by an affiliate of Glenview Capital Management, LLC. The transaction resulted in the combined company being renamed to Butterfly Network, Inc., with its Class A common stock to commence trading on the New York Stock Exchange on February 16, 2021 under the symbol “BFLY.” (company press release)
• Creso Pharma announced it has executed a non-binding letter of intent with CERES Natural Remedies for the distribution of Creso’s CBD-based anibidiol animal health products in the United States as soon as the USA legalizes CBD products, which the companies expect will happen later this year. (Stockhead.com.au)
• Whitebridge Pet Brands announced it has completed the acquisition of Grizzly Pet Products, maker of Grizzly pet supplements. Terms of the transaction were not disclosed. (Pet Product News)
• Hippo Manager announced its software now connects with Zoetis VETSCAN FUSE, seamlessly connecting lab results to practice management software through a secure Application Programming Interface. (company press release)
• Vet’s Best Friend, the owner of 12 veterinary practices in seven Northeast states, announced it is planning further expansion after receiving a significant investment from the private equity firm Revelstoke Capital Partners.(Todays Veterinary Business)
• Petriage announced it has received a patent for a new virtual tool that tells pet owners when to seek veterinary care. The Pet Symptom Analysis tool allows owners to input information about their pet’s symptoms, then tells them how urgent it is to get care. According to Petriage, the tool works with 97% accuracy. (Vet Advantage)
• FERA Diagnostics and Biologicals announced the company’s move from Ithaca, New York, to College Station, Texas, effective April 15. (company press release)
• The North American Veterinary Community (NAVC) announced the launch of a comprehensive portfolio of new virtual programs and events to provide interactive year-long learning anytime, anywhere, customized to individual learning preferences. (company press release)
• Fi, a developer of pet tracking collars, has raised $30 million in a Series B funding round that values the pet tech startup at upwards of $200 million. The round follows a $7 million Series A raised in 2019. Fi’s system uses geofencing, Wi-Fi and Bluetooth to let owners know when pets have strayed beyond their boundaries. (Techcrunch.com)
• Summit SmartFarms (SSF) – a leading designer and builder of swine, beef, dairy and egg production facilities – and IoT firm Atomation announced a new multi-year partnership to serve the agricultural industry with smart technology solutions. The Atomation partnership equips Summit SmartFarms with smart technology for remote monitoring of equipment, environment, behavior and health data for prescriptive and predictive analytics. (Feedstuffs)
• EU Biomin announced it has secured EU authorization of its FUMzyme feed additive for all species. According to the company, FUMzyme is the only commercially available mycotoxin-deactivating enzyme for application in fermenting feed, including silages. (IHS Markit Connect)
• UK United Petfood announced the acquisition of the British manufacturer Cambrian Pet Foods. Financial terms were not disclosed. (GlobalPets)
• CANADA Sirona Biochem announced it has closed binding terms with an un-named animal health company regarding its pet diabetes candidate, and anticipates closing with a second partner soon. The business is working on its TFC-039 drug, which is a sodium glucose co-transporter (SGLT2) inhibitor designed to be a diabetes drug for cats and dogs.  SGLT2 inhibitors act in the kidneys to reduce the re-absorption of glucose into the bloodstream. (IHS Markit Connect)

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ANIMAL HEALTH STOCK PRICE TRACKER

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ANIMAL HEALTH NEWS

• UK – FMD IN DOGS The Pirbright Institute has reported the first instance of foot-and-mouth disease (FMD) virus in a dog that ate infected meat. The organization described this a “highly unusual case”, where the virus was identified in a sample of heart tissue received by Pirbright’s World Reference Laboratory for Foot-and-Mouth Disease. The sample was from one of five young dogs that had died after being fed the carcasses of lambs. These lambs had themselves died during an FMD outbreak on an Iranian farm. (IHS Markit Connect)
• US – ASF SURVEILLANCE The U.S. Department of Homeland Security’s Science and Technology Directorate has released a new document to keep officials updated on the latest findings on African swine fever.  The ASF Master Question List provides an “authoritative summary of publicly available information about the virus to promote coordinated research and improved emergency response preparedness.” (Vet Advantage)
• US – FELINE GUIDELINES The American Animal Hospital Association (AAHA) and the American Association of Feline Practitioners (AAFP) have released new 2021 AAHA/AAFP Feline Life Stage Guidelines . The AAHA and AAFP convened a Task Force of experts in feline medicine with the goal to define distinct feline life stages and provide a framework for individualized healthcare plans. (association press release)
• US – CROP REGULATION A new bipartisan, bicameral bill – the Feed Emergency Enhancement During Disasters with Cover Crops Act (FEEDD Act) — would create a clear emergency waiver authority for USDA to allow producers to graze, hay or chop a cover crop before November 1st in the event of a feed shortage due to excessive moisture, flood, or drought. With this waiver, producers would not have to take a further discount on their crop insurance. Currently, under the Federal Crop Insurance Program, producers unable to plant a crop due to adverse weather conditions are eligible to receive a small indemnity but prohibited from growing a cash commodity due to a missed window in the growing season. The FEEDD Act will provide farmers and ranchers emergency flexibility to help alleviate livestock feed shortages during planting seasons with high levels of prevent plant due to extreme moisture or drought. (Feedstuffs)
• US – CANINE TICKBORNE DISEASE Researchers have identified a new Rickettsia species in dogs with clinical signs like Rocky Mountain Spotted Fever (caused by Rickettsia rickettsii).  The new, yet-unnamed species was discovered from three clinically ill dogs whose samples were sent to the North Carolina State Vector-borne Disease Diagnostic Laboratory via PCR and DNA sequencing;  it has since been diagnosed in four more dogs.  The discovery was published in Emerging Infectious Diseases. (Veterinary Practice News)

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BRAKKE CONSULTING VIEWPOINT
As the Brakke Consulting team was preparing the 2021 Industry Overview, we realized that a portion of the growth of the animal health industry over the years is because companies are defining the animal health industry in bigger terms.  Which reminded me of Jack Welch.

Prior to Jack Welch joining GE, the company was known for growth rates that were bound by GDP.  Welch’s strategy for breaking this reputation was for each business unit to be the best, #1 or #2 players, in their markets.  If they weren’t and couldn’t be fixed, they were closed or sold off.  But then leaders of these businesses started to define their markets in smaller terms to justify a top position.  This cost the company growth, so Welch changed the strategy.  Business unit leaders had to redefine their markets so that they had no more than 10% market share.  By doing this, many GE business units moved from being commodity providers, to problem solvers, which actually led to creating demand for their commodities.

We are plainly seeing this today in the animal health industry, which used to be defined as antibiotics, pharmaceuticals, biologicals and parasiticides.  The new definition now includes diagnostics, identification and tracking technology, as well as microbial and nutritional products, and genetics.  Think bigger, redefine your market, solve problems, create demand, grow your business. Sound like Jack?

Bob Jones

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YOUR VIEW
Last week’s viewpoint by Jishu Shi was about veterinary education, the One Health concept, and global cooperation when dealing with the transboundary nature of zoonotic diseases.  With a view to the global nature of One Health and zoonosis awareness, we asked you how international was your company’s footprint. About 40% of respondents said their employer was not international, 40% said less than half of their company’s revenue was from outside the US and about 20% that half or more of their employer’s revenue was generated outside the US. Given that most of the animal health business is in the hands of multinational companies these days, perhaps the numbers are more a reflection of who likes to answer the poll questions than of our subscriber base in general.

This week
Since we are remembering Jack Welch, let’s see which one of his quotes is your favorite.  There are a lot to choose from, but we’ve narrowed them down to five.

Please choose your favorite quote from Jack Welch.