Earnings season 2022 is behind us and believe it or not, earnings announcements for 1Q23 are right around the corner. The animal health industry’s growth was largely driven by the companion animal market as evidenced by the announcements by the largest companies where Zoetis, Merck, IDEXX, Virbac, and Dechra showed above industry average growth. The livestock segment however, tempered the overall growth of the bigger companies, with the exception of Huvepharma and Phibro.
The livestock industry is looking at a cyclical slowdown and an important question is how long it will last. Will this cycle have an impact on innovation in the livestock segment? There is no doubt an ongoing need for products and services to be provided to livestock and poultry producers to continue to drive increased efficiency and yields for the proteins that feed the world. We know the livestock industry will pay for innovation, but we are worried about the investment in innovation for livestock.
In recent years, both Merck and Zoetis have made significant investments into technology to drive efficiency. But we hope there is still investment in preventative and therapeutic products for livestock. We would like to see the livestock industry to remain a “star” and not become a “cash cow”.
Randy Freides
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