As we enter the new year and rush of conferences, product launches, new hires, and more, let’s talk about employer brand. Recruitrics, a major recruitment marketing firm says, “Employer branding became more important than ever this year as competition for top talent intensified.”

As we shift from Baby Boomers to Gen Z, we should shift our priorities and messaging. Beyond compensation, Gen Zs value meaningful work and a supportive culture. “65% … won’t apply for a job if the employer’s values aren’t aligned with theirs.”

Authenticity is the new watchword. With the omnipresence of digital communications, personalized authenticity wins the day.

How to address this megatrend? “Regularly update your company’s social media, career site, and other platforms with stories about your employees, workplace diversity, and community engagement … Present a well-rounded, appealing picture of your organization that will resonate with your target talent.” Focus on employees’ feelings and experiences, stressing well-being and mental health. Use video liberally, particularly in team member testimonials. Where possible personalize messages, aligning your culture with candidates’ backgrounds. With a definitive mission for animal health, our industry enjoys an enviable position. Leverage it.

Remember, we’re selling more than buying! Brakke Consulting can help.

Jeff Santosuosso

It was great to see many of our News & Notes subscribers at the VMX conference in Orlando this week and we are very grateful to those that attended the 2025 Animal Health Industry Overview on Monday afternoon.  This was the best attended session we have ever had, so thanks to all of you for your support.

As I walked the exhibition hall and talked to the exhibitors, everyone seemed to be positive about 2025, especially those with new products to launch.  Elanco’s combination parasiticide, Credlio Quattro was launched and the company was taking orders, along with recently approved Zenrelia for atopic dermatitis.  There was some buzz around Merck’s injectable Bravecto parasiticide and possible dermatology product later in the year.

Another notable launch was IDEXX’s new lymphoma early detection test – IDEXX Cancer Dx – notable for its affordability and ability to expand on to other cancers.  There was some talk about Zoetis’s Librela for canine OA pain, but my sense is that veterinarians are simply learning how to use it – my 10-year-old athletic Labrador retriever is doing fantastic after his third injection.

We will hold our Industry Overview at WVC in Las Vegas on March 3rd, so if you missed the one in Orlando, you still have a chance to attend.  Hope to see you there.

Bob Jones

Last week, the annual JP Morgan annual healthcare conference concluded.  Many of the top human and animal health companies presented their future visions to the investing community.  Zoetis and Elanco were front and center and Merck mentioned its animal health business as part of its human health presentation.

I took a few minutes to look at the pipeline focus and products highlighted in these presentations.  The pipelines are heavily concentrated on the companion animal segment.  Therapeutic areas of focus in the pipelines include osteoarthritis/pain, renal disease, oncology, cardiology, dermatology and the next generation of parasiticides.  Many of the pipeline products are monoclonal antibodies, injectable products and focused on long-acting formulations.  What does this mean for the livestock segment?  Maybe it’s just a lack of visibility into livestock pipeline products but it certainly seems that the R&D focus is on the segment of the market providing the highest growth rates.

It will be interesting to see how the overall market evolves with the next wave of innovation.  These new therapies that are primarily delivered via injections will drive patients back to the veterinary clinic.  Will there be a bifurcation of the prescription market with Chewy/Amazon/PetMeds focusing on oral prescription and OTC products and veterinarians focusing on injectables and vaccines?

We will talk about innovation at the Brakke Consulting annual Industry Overview presentation at both VMX and WVC – hope to see you there.

Randy Freides

That there are a number of concerning trends in animal diseases right now. There’s the ongoing problem with highly pathogenic avian influenza in both birds and dairy cows; Mexico’s announcement of new world screwworm; the detection of African Swine Fever on Caribbean islands, and this week the first case of foot-and-mouth disease in Germany in 40 years, to name a few.

Our government in the US seems to be taking the threat of foreign diseases seriously. USDA is establishing a Swine Health Improvement Program that will monitor for ASF and CSF. They have earmarked $165 million in emergency funding for protecting US livestock from screwworm, and are rebuilding the government’s avian influenza vaccine stockpile.

We have already seen instances of species-hopping in these viruses – for example, avian influenza has sickened both cows and cats, as well as a few people. For that reason, it’s imperative that the One Health approach becomes the standard in both human and animal healthcare moving forward. The US Government’s newly released National One Health Framework is a step in the right direction. Now it’s time to implement their recommendations and to work collaboratively to address threats and public health preparedness.

 Lynn Fondon

A recent analysis by Vetsource, a service provider to veterinary practices, showed that prices in companion animal practices (measured July to July) increased 7% in 2022, 10% in 2023 and 8% in 2024 – all well above the US rate of inflation.  One of the primary reasons was the increased cost of labor, the largest expense category for veterinary practices.  Mean starting salaries for new DVM graduates in companion animal practices reached $137,727 in 2024, compared to just $97,000 in 2020.  Salaries for non-veterinary team members were up significantly as well.  Now price inflation is having the expected impact: driving down demand (although revenue growth is still in positive territory).

What does this bode for the future?  We’ll have much more data to share at the Brakke Industry Overview at VMX and WVC, including the results of a comprehensive Workforce Study that we recently completed.  It forecasts veterinarian workforce needs to 2035.  Please join us at the Overview to learn more!

 John Volk, Senior Consultant
Chicago

One of the things that I learned in my career in the animal health industry is that to open a new chapter, the old chapter needs to be closed.  The context for this was usually an acquisition, which happened to me five times, or a significant job change.  But this week, let’s expand the opening and closing of chapters to the financial performance of companies on our stock table.

This week we have posted the full year stock price performance for 2024 for the animal health companies and next week the reporting of 2025 stock price performance will begin.  Because of the large variation in stock price performance, we added the 2023 year-end performance for comparison.  A few things stand out.

First, we have had two years of good and similar performance in the broader indexes – the S&P 500 and the DJIA.  Second, of the currently public animal health companies, only Freshpet had two good years in a row – and their growth is about three times the S&P 500 growth.  Third, for several companies, the gains seen in 2023 were given back in 2024 (Elanco, IDEXX, Neogen, Zoetis and Zomedica).  Finally, 2024 was a much better year for only a few companies (Chewy, Phibro and Trupanion).

As we close 2024, let’s open 2025 and hope for impressive performance the publicly traded and private animal health companies.  We’ll track it for you.

Bob Jones

KEEPING THE INDUSTRY INFORMED SINCE 1999

About this time last year, we wondered if the US economy would enter into a recession in 2024.  And here we are looking ahead to 2025, not wondering too much about a recession but more about what effects new policies from a new administration in our nation’s Capitol might do to the economy in 2025.   Increases in tariffs, changes in immigration and tax cuts are policy changes that will affect the economy, but many view that with these policy changes, consumers will still be spending and will drive growth.

This last edition of News & Notes summarizes the things that happened in 2024 that we covered each week throughout the year.  From acquisitions, mergers, company news, launches, approvals and deals, you’ll be reminded of what happened.  You can find all the newsletters here if you’d like more detail on a noteworthy item.

Thanks should go to two members of our team.  Dr. Lynn Fondon has been the editor of the News & Notes for 25 years and succinctly curates the news items for our readers every week.  And Amanda McDavid pulls it all together and gets it out to you every Friday.  Thanks to both of you for publishing a terrific newsletter.

More thanks are due.  First, thanks to all our clients and customers and we hope that we have made your business better, more profitable, and more competitive.  Second, thanks to all the Brakke Consultants for another great year.  It is a pleasure to work with a team of industry professionals with the depth and breadth of experience and knowledge they have.

Finally, thanks to you, our News & Notes readers and we hope our weekly newsletter has helped you do what you do better.

Bob Jones

A little over two years ago, Covetrus, one of the US’s big three animal health distributors, became a private company after the acquisition by funds Clayton, Dubilier & Rice and TPG Capital and we learned this week that another of the big three is also going private.

There was a hint of something strategic happening at Patterson Companies during the company’s 2nd quarter earnings call last week.  The company announced this week that it will be taken private by Patient Square Capital in a $4.1B deal.  Through the 2Q, which ended in October, Patterson had YTD revenue of $3.2 billion (83% in the US) with $2.0 billion coming from its animal health business and $1.2 billion from its dental distribution business.  The animal health distribution business is almost twice as large as the dental business and was performing better than it too.

We also note that the biggest competitor to the big three, Midwest Veterinary Supply, closed last month on its acquisition of Victor Medical, which provided Midwest greater access to veterinary clinics in the western US.

Publicly-traded companies turn into private companies for lots of reasons: freedom from public market scrutiny, strategic and operational flexibility, valuation and market discrepancies, and several others.  We will have to wait until next year to see what changes are ahead for Patterson but we hope they are all positive.

 Bob Jones

I hope that most of our readers recall that I am one of the newest consultants to join the Brakke Consulting team and that I am in Brazil.  So, sometimes I see things from a different hemisphere.

I am also an individual who frequently engages in sports, which benefits both my body and mind. One morning this week, I went for a run in a nearby park and listened to a morning news radio program. An interview with an agribusiness opinion leader caught my attention. He shared his outlook for the coming years, considering the recent surge in exchange rates in Brazil, with a 3% currency depreciation last week and around 20% in 2024.

Brazilian agribusiness will once again benefit from growing international demand for proteins produced here. With increasing protectionism in the U.S. starting in January under the new administration and potential tariffs on Chinese imports, a possible Chinese reaction to U.S. food imports may occur. This dynamic reinforces the positive effect on Brazilian agribusiness: both from a stronger dollar, as Brazil’s exports are sold in local currency, and new demand for Brazil’s proteins from the Chinese market.

Brazil’s agribusiness will continue to be the growth engine of the country’s economy. Changes in the northern hemisphere will likely benefit Brazil from this new market dynamic.  If you see an opportunity for growth in your business here in the southern hemisphere, we can help.

Mauri Ronan Moreira

Home Delivery as a Drop-Ship Business: A Growing Opportunity for Veterinary Practices

Home delivery is much more than a convenient service for pet owners—it’s an opportunity for veterinary practices to drive in-house pharmacy revenue while streamlining operations. Adopting a drop-ship model (and mindset) for pet medications, diets, and wellness products provides several immediate benefits including better compliance, reduced inventory management burdens and improved staff efficiency.

The drop-ship model allows practices better manage valuable pharmacy and clinic space, reduces the risk of expired or overstocked items and helps prevent theft. Products shipped directly from suppliers to clients simplifies the logistics and allows staff to focus more on patient care.

From a business standpoint, analysts suggest aiming for profit margins between 20-30% to ensure a healthy return. While these margins may seem considerably lower than those from in-clinic sales, the reduced labor and operational costs associated with drop-shipping make it an attractive option.

As with nearly all personal interactions in life, clear communication with clients is key to making this successful. Promote auto-ship option to lock-in repeat purchases, offer bundled wellness packages, and implement loyalty incentives to encourage repeat replenishment purchases.

For practices looking to stay competitive and meet client expectations, managing home delivery through a drop-ship model is a smart move. It combines convenience for pet owners with profitability for the practice—offering benefits for everyone involved.