Brakke ViewpointsWe are the experts in animal health
Last week John Volk wrote about the unbelievable turnout at VMX with over 27,000 in-person attendees. I certainly felt the optimism in the air at VMX but also sensed a cautiousness – can the animal health industry remain resilient in the face of economic uncertainty.
At the beginning of 2023, inflation was running at levels not seen in over 40 years. The Fed is trying to cool the economy by increasing interest rates from near 0% at the beginning of 2022 to 4.5% today. Talk of a recession is everywhere.
We are now starting to see the pain that rising interest rates, slowing demand and a recession will cause. Amazon, Microsoft, Facebook, Google, Salesforce, Twitter and Goldman Sachs have all announced thousands of layoffs in the past two months. Maybe these companies staffed-up too quickly during the pandemic and are now right-sizing, but this may be an omen of things to come.
But many vet clinics are as busy as ever and always appear to be in search of qualified candidates to fill openings for veterinarians and vet technicians. We will review hiring issues, what veterinarians intend to in times of inflation and more at our annual Industry Overview at WVC on February 20th (sign up here). We are hoping for another big, optimistic turnout at WVC – maybe that will be a good sign for 2023.
Wow! NAVC’s VMX veterinary conference in Orlando smashed all records this week with a reported 27,000 attendees. That’s more than 10,000 more than last year’s registration. The show was jam-packed with a record number of CE sessions, entertainment, and a huge exhibit hall. Many of the exhibitors thought outside the box with novelties such as a roller-skating rink and free (real) tattoos. (I admit that I took advantage of neither, thinking ahead to the possible reaction of returning home with a broken bone or body art.) Kudos to Gene O’Neill and his team for a spectacular event.
The annual Brakke Industry Overview at VMX was standing room only as well. Thanks to panelists Scott Bormann, Kurt Green and Kevin Polhman for their cogent remarks. We had to turn several people away, so we hope you can join us for the Overview at WVC in Las Vegas. This one you don’t want to miss.
Innovation seems to be the at the forefront of 2023. Last week, we heard about the first-ever vaccine for honeybees (from Dalan Animal Health); and the first-ever injectable pentosan approved for equine osteoarthritis (from Anzac Animal Health). This week, Zoetis’ Solensia was launched, along with several novel regenerative therapies.
Much of the innovation in today’s animal health space seems to originate from startups rather than the established animal health leaders. While Solensia’s development was completed by Zoetis, the technology was acquired when Zoetis bought biotech startup Nexvet Biopharma several years ago. The other products mentioned were all developed by animal health startups. It’s exciting to see so many new products, especially those that represent new solutions to unique challenges.
I’m looking forward to attending next week’s VMX meeting, and learning what other innovations are coming our way.
Last week’s Viewpoint ended with a comment about looking away from the rearview mirror of 2022 and driving as fast as you can into 2023. What can we expect in 2023? Judging by all the things I read these last two weeks about the general economy, I have learned two things: one, no one really knows what will happen to the economy, and two, I am happy I studied animal science and not the dismal science, also known as the study of economics.
So, times are uncertain in 2023. And this is the topic for our panel of senior executives at our annual Industry Overview presented at the VMX conference in two weeks, and at WVC next month. We have an opportunity to learn from senior animal health company executives on “Managing Animal Health Companies in Times of Uncertainty.” Moderated by Brakke Consultant Paul Casady, we will hear from Scott Bormann, Sr. Vice President, North America, Merck Animal Health; Kurt Green, President and CEO, Vetsource; and Kevin Pohlman, COO, Patterson Companies.
Their insights into how they will manage moving from pandemic-complicated years to a year of inflation, possible recession, staffing shortages and client demands will be valuable to many in our animal health industry. Maybe with their help, we’ll all have a clean driving record in 2023.
ANIMAL HEALTH NEWS & NOTES CELEBRATES
23 YEARS OF INDUSTRY NEWS
For many of our readers, 2022 is a year you will be happy to see in the rearview mirror. We are an optimistic bunch and maybe 2023 will be better – maybe we will have a soft landing and we will avoid a recession. Regardless, the animal health industry is a resilient one, and so are the people in it.
If you did want to look in the rearview mirror, this last edition of News & Notes summarizes the things that happened in 2022 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 in our searchable archive if you’d like more detail on a noteworthy item.
Now, some noteworthy recognition. Dr. Lynn Fondon has been the editor of the News & Notes for 23 years and brilliantly 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.
And some 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. So, look away from the rearview mirror, look down the hood at the horizon, put your foot on the accelerator and have a great drive into 2023.
One of the topics that we will cover at our annual Industry Overview presentations at VMX and WVC concerns the consumerization of the veterinary pharmacy. If done right, consumerization can be a win-win for those involved in getting prescription and non-prescription pet medications to pet owners. But an emerging technology may make this experience even more complicated.
The technology model is called ChatGPT, an artificial intelligence tool from a company called OpenAI. ChatGPT interacts with the user in a conversational way. It can answer questions, follow up questions and challenge premises; however, it is still in a testing phase and is trained on a limited dataset. I signed up as a tester and asked it a few animal drug and veterinary questions – I was blown away how much better ChatGPT is than a search engine.
I asked Chat GPT about pet owner reviews of a few medications, which are important for online purchases, but it is not trained on that data yet. How will it eventually manage negative reviews? It wouldn’t make drug recommendations (yet) when asked. If you are a company that uses a website to support your business, pay attention to ChatGPT. It will make the experience better – and more complicated.
You may have noticed that this year’s Thanksgiving turkeys were generally smaller, but more expensive, than last year. Farm Bureau’s annual survey found that the cost of a turkey was up 21% over 2021, while the cost for other food was up around 12%; the USDA’s estimate of the increase in turkey prices was even higher. While some of that is undoubtedly general inflationary pressure, avian influenza has also impacted the turkey supply. According to one source, around 7.3 million turkeys died as of Thanksgiving as a result of the current avian influenza outbreak.
The current avian influenza outbreak in the US is the worst on record, and many other parts of the world are struggling with it too. In addition, African swine fever is an ongoing issue outside of the US. Controlling these pandemics can be challenging, as many diseases are spread to livestock production facilities by wild animals carrying the viruses. Efforts are underway to develop effective vaccines that can be differentiated from wild-type infection on diagnostic tests, but it’s been a bumpy road.
Much of the focus on the animal health side of One Health initiatives has been on zoonotic diseases, but animal diseases that don’t cause pandemic-level illness in humans can have an impact our food supply. I hope that R&D dollars reflect this reality, and that our industry can keep pace with the challenges on the contagious disease front.
Let’s face it animal health and nutrition industry: we’ve got a digital problem. It’s not just us! Nearly everyone is searching for talent with digital skills.
Increasingly, filling the top of the sales funnel via digital marketing such as social media advertising, makes or breaks us. How to execute in these new media? How to gauge our success in this new frontier?
The implications of not knowing are profound. RAND recently surveyed over 1000 companies worldwide, with 54% citing a “shortage of digital talent (that) has led to a loss in competitive advantage.” Management consultant Wiley reported that the US ranks 26th in their Digital Skills Gap Index! RAND urges teaching digital skills in primary school.
The experts at PayMo recommend starting with upper management. Digital skills awareness isn’t just for marketers. They’re a strategic and organizational ball of wax. Familiarize your general managers. Skills most in demand, according to Wharton are data analysis, SEO, social media marketing, content marketing, and video marketing.
How should you address this need? Along with your management, you can train your team members via online tools. You can rely on your agency and if you dare, your media reps. But for the long term, all of us should be recruiting for these essential skills – we can help.
There’s an old song from my generation called the ‘Wreck of the Edmund Fitzgerald’, in which the lyrics waxed about the ‘Gales of November’(hurricane force winds) and their effect on ships crossing the Great Lakes which could be quite catastrophic.
It seems we have something like this now as some companies are presenting their results this month for Q3. And like those ships, it can be rough sailing for companies if expectations have not been managed well.
The animal health business has very strong and reliable long term success drivers- but it can be in the short term impacted by the same issues that affect all businesses: supply chain disruptions, workforce issues, and cost increases. Management must recognize these problems and provide clear, effective solutions to keep the business moving forward. And communicate those to our customers and investors, in that order. How is it in your company or practice?
We as an industry also need to see that COVID provided a strong tailwind for the last couple of years that unfortunately may have been used to build future growth targets. As the business appears to be settling back to a more ‘normal’ performance( which is still very good), this now becomes an ‘uncomfortable truth’ for some to explain.
But animal health has a great story to tell, and it reminds me of a famous saying: success is a journey, not an event.
For humans, wearable technology is something that has been around for a number of years. The first Fitbit device was introduced in 2009. Since then, the technology continues to evolve such that the latest Apple watch can detect heart rate changes as well as arrhythmias, far beyond just tracking steps and movement.
For pets, technology to track movement, location via GPS monitoring and temperature continues to gain traction. In an interesting collaboration, two divisions under the Mars umbrella have collaborated to develop a canine activity tracker that tracks key health metrics such as a dog’s activity levels, eating and drinking times, and scratching and licking habits. This provides pet parents with data-driven insights to detect potential health concerns, monitor and manage chronic health conditions, and make data-driven decisions on the best way to care for their pets, including how to choose the best food to meet their dog’s nutritional needs. Hello technology, meet marketing.
Given that our four-legged family members can’t vocalize when they are not feeling well, technology provides an easy and convenient way to gather data, provide potential early insights to potential illnesses and improve the overall health of our furry companions. Maybe the next tech breakthrough will be a voice box that vocalizes what your dog is thinking when they look at you with their head tilted sideways…you never know. Well, you may not want to know.