Animal Health News & Notes for November 3, 2023

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Brakke Consulting’s
Animal Health News & Notes for November 3, 2023
Copyright © Brakke Consulting
Editor: Lynn Fondon DVM MBA
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IN THE NEWS:
Brakke Consulting News
2023 Pet Medications Home Delivery Study – pre-order by Nov. 15

Earnings News
Hill’s
IDEXX
PetMed Express
Swedencare
Zoetis

Other News
Athian
Canine Cancer Foundation
Cara Veterinary Corp
Dechra
Elanco
Furry Land
Medgene
NAVC
Nestle Purina Petcare

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Brakke Consulting
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www.BrakkeConsulting.com

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EARNINGS NEWS RELEASES

• Zoetis reported its financial results for the third quarter of 2023. Revenue was $2.2 billion, an increase of 7% compared with the third quarter of 2022 (+8% currency adjusted). Net income was $596 million, an increase of 13%. Revenue in the US segment was $1.17 billion, an increase of 8%. (company press release)
• IDEXX announced results for the third quarter of 2023. Revenues were $916 million, an increase of 9% (+8% organic). Net income was $212 million, an increase of 17%. Companion Animal Group revenue was $837 million, an increase of 9%. CAG income from operations was $253 million, an increase of 14%. (company press release)
• Colgate-Palmolive Company reported results for third quarter 2023. Sales for Hill’s Pet Nutrition were $1.058 billion, an increase of 22% (+15% organic sales). Pet Nutrition operating profit was $201 million, unchanged from the prior-year quarter. (company press release)
• PetMed Express, Inc. announced its financial results for its second quarter ended September 30, 2023. Net sales were $71 million, an increase of 9% year over year. Net loss was $(70,000) compared to net income of $2.6 million for the prior year quarter ended September 30, 2022. (yahoo finance)
• Swedencare AB reported results for the third quarter of 2023. Net revenue was 602 MSEK ($54 million), an increase of 25% (+17% organic currency-adjusted growth). Profit after tax amounted to 38.1 MSEK ($3.4 million) compared to 3.8 MSEK in the prior-year quarter. (company website)

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COMPANY NEWS RELEASES

• Athian and Elanco Animal Health announced the establishment of the first-of-its-kind voluntary livestock carbon insetting marketplace, with the first accepted protocol aimed at reducing enteric methane emissions and improving feed utilization by using innovative feed management products from Elanco. This new carbon marketplace creates an opportunity for dairy farmers to monetize their greenhouse gas emission reductions. (company press release)
• Nestle Purina Petcare Company has been named in a class action lawsuit alleging that the company markets pet foods as natural, although the products contain synthetic ingredients. Other pet food companies have faced similar lawsuits related to natural ingredient claims. In 2017, plaintiffs alleged that Rachael Ray’s Nutrish wet and dry dog food packaging used deceptive marketing by prominently labeling the products as natural. In 2019, J.M. Smucker was the target of a class action lawsuit alleging that Big Heart falsely markets Nature’s Recipe brand pet foods as all natural. (Petfoodindustry)
• Medgene announced it has been granted a Conditional Use License by the USDA’s Center for Veterinary Biologics (USDA-CVB) to further manufacture and distribute its vaccine targeted at Rabbit Hemorrhagic Disease (RHDV2). RHDV2’s virulence and rapid spread previously prompted the USDA-CVB to grant Medgene’s vaccine Emergency Use Authorization in 2021. (com)
• NAVC announced the launch of NAVC Gives, a unique award program that will support individuals, groups and organizations around the world that have made a profound difference in the lives of veterinary professionals and animals. The NAVC has committed $1 million to fund this unique grassroots award program. (company press release)
• All Creatures Animal Hospital in Bremerton, Washington, and parent company Cara Veterinary Corp., announced an agreement with unionized hospital staff, following two years of negotiations. According to the National Veterinary Professionals Union, All Creatures Animal Hospital is only the second private veterinary hospital to unionize; in 2020, Columbia River Veterinary Specialists in Vancouver, Washington, became the first veterinary practice to do so. (AVMA)
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• Furry Land announced it has reached a new milestone with its 100th mobile grooming van. Furry Land vans are equipped with solar panel roofing, allowing the equipment in the vans to be used without running the vehicle. The vans are also equipped with generators, and 70 gallon fresh water reservoirs. (Pet Product News)
• The Canine Cancer Foundation, Inc. announced the launch of com, an online platform that aims to empower pet owners with knowledge, resources, and support when faced with a hemangiosarcoma diagnosis. (company press release)
• UK Dechra and the UK’s RVC announced the launch of a new endocrinology app for dogs, which will provide vets with a prediction of how likely a dog is to have Cushing’s syndrome based on its clinical signs, and will also provide additional information on the treatment and monitoring of diseases such as Cushing’s and Addison’s. The app is based around a machine-learning form of AI utilizing anonymized clinical records from millions of dogs within the RVC’s VetCompass database. (co.uk)

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ANIMAL HEALTH STOCK PRICE TRACKER

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ANIMAL HEALTH NEWS

• WORLD – RABIES GUIDELINES The Tripartite organizations (FAO, WHO, WOAH) have released an update on Oral vaccination of dogs against rabies: recommendations for field application and integration into dog rabies control programs. The newly published document aims to provide practical guidance for the implementation of Oral Rabies Vaccines as an integrated tool within national strategies for controlling rabies in dog populations. (organization press release)
• US – ORGANIC STANDARDS The USDA has finalized the Organic Livestock and Poultry Standards (OLPS), establishing clear, strong and consistent standards for organic livestock and poultry production. In partnership with USDA-accredited certifiers, USDA’s National Organic Program will oversee the implementation of and enforce compliance with the new standards. Click here to see a preview of the rules. (Feedstuffs)
• US – VETERINARY CONSOLIDATION S. Federal Trade Commission Chair Lina Khan delivered the keynote address at a virtual economics forum organized by the AVMA, signaling regulators are wary of the fast rise of big corporations and big money in the profession. Since 2017, the agency has intervened four times in acquisition deals in the veterinary profession. (Vet Advantage – VIN News)
• US – VETERINARY PHARMACY The Board of Pharmacy Technician Specialties announced it is launching a Veterinary Pharmacy Certificate. This specialized credential will be the first of its kind to recognize pharmacy technicians involved in providing pharmaceutical care for animals. (com)

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BRAKKE CONSULTING VIEWPOINT
It’s earnings season and several companies’ reports are listed in today’s newsletter.  For the most part, revenue and earnings for animal health and petfood companies have remained strong.

Interestingly, many stock analysts interpret individual company’s revenues in the context of declining veterinary visits for pets.  But is that a good metric?  Veterinary expenses are paid out of discretionary income.  During the pandemic, when the government was pumping money into the economy – and many people were home and could easily take their pet to the vet – veterinary visits increased faster than normal.

Now, as household discretionary income is returning to normal, so are vet visits.  Yes, veterinary visits have declined from their highs.  But most practices are still very busy and practice owners tell us that they are seeing more normal visit patterns emerge.  Is it really appropriate to evaluate current revenues in light of a possible sales bump during the pandemic?  Perhaps it’s best to ignore the pandemic bubble when looking at company performance, and judge based on a longer term perspective.

John Volk

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YOUR VIEW
Last week we asked whether you were an Amazon Prime member and/or a pet owner.  It turns out that more than three-fourths of you are BOTH Prime members AND pet owners.  An addition 9% have pets, but are not Prime members.  That means an estimated 85% of Brakke Newsletter readers own pets!

This week
In her presentation at AVMA’s excellent Business and Economic Forum, U.S. Federal Trade Commission Chair Lina Khan emphasized FTC’s opposition to non-compete agreements, with limited exceptions, for example when an owner sells his or her company.  So two questions:

1. Do you agree that non-competes should be eliminated? 
2. Are you currently subject to a non-compete?