Pet insurance has been available in the USA for more than four decades, and yet the latest statistics from the North American Pet Health Insurance Association (NAPHIA) say that only about 4 million pets in the USA are insured – that’s only 4% of dogs, and a mere 1% of cats. That stands in stark contrast to some other countries; for example, in the UK 61% of dogs and one-third of cats are covered by health insurance; and in Sweden 9 out of 10 dogs, and half of all cats, are reportedly insured.

A higher proportion of insured pets would be a plus for the veterinary profession – more pet owners able to afford the kind of “gold standard” care that all veterinarians wish for their patients.  The good news is that growth in insured pets is outpacing overall growth in the pet population. NAPHIA reports that average annual growth in the number of insured pets in the USA since 2017 has exceeded 20%, and the pace is accelerating: in 2021 the growth was close to 30%.  Maybe we can only aspire to reach coverage levels in the UK or Sweden, but we’re moving in the right direction.

Lynn Fondon

Brakke Consulting started using Zoom before it became cool, or at least before its use exploded by the pandemic-driven closure of offices.  Our business needed a “virtual” telephone system that our previous telecommunications provider couldn’t offer and we chose Zoom, which for our business model has been very good.

So, I was interested in what Eric Yuan said yesterday about the future of hybrid work at a BoxWorks 2002 virtual panel discussion.  He said that the hybrid work model is “not that straight forward” and that his video communications company is “still trying to figure out what’s a sustainable business model for us.”  This strikes me as odd, that the company that facilitated hybrid work doesn’t have their own hybrid model figured out.

We asked several questions of our readership last year about hybrid work and thought it would be interesting to look back on what we can learn.  When asked one year ago about working conditions in the next 12 to 18 months, over 50% said their companies will implement a hybrid style with both remote and in-person work.  We asked about productivity last December, over 60% said they were significantly more or more productive.

Now that we are in the middle of budget season, many companies, like Zoom, are trying to figure out what that model will be for 2023.  Cool or not, Zoom (and Teams) are here to stay.  Let’s hope it truly does drive productivity.

Bob Jones

If you read this newsletter each week, you know we’ve been following the progress of Zoetis’ Solensia (frunevetmab) into the US market.  Although approved by the FDA in January 2022, it was just launched in the US by Zoetis this past week.

Solensia opens finally opens the osteoarthritis treatment segment for cats in the US; the product is predicted to be a blockbuster (>$100 million) when it matures.  Since the market for OA products in dogs has been a major driver of growth in the animal health industry over the past 20+ years, launch of the first OA treatment safe and effective for cats will have a strong additional effect.  Today Zoetis remains exclusively positioned to supply monoclonal antibody products in veterinary medicine.  We also expect to see the launch of Zoetis’ Librela (bedinvetmab) in the US to treat OA in dogs sometime in the next 12 months.

Market research conducted by Brakke in late 2021 showed >90% of veterinarians are likely to use Solensia, primarily in cats with OA that aren’t being treated with a prescription medication.  We believe that Zoetis has worked hard this year to create awareness of OA in cats.  Today this feline market is substantially underserved, so the Solensia launch will cause significant market expansion.  The OA market in dogs is of course quite crowded already, so the effect of the Librela launch may be less impactful, but still significant.  Time will tell.

Jim Kroman

We are trying something new this week in our Viewpoint, hoping to dispel the idea that you can’t teach an old dog new tricks. To learn about the impact of videos in recruiting, all you need to do is click on the link below…to a short video.  Even an old dog would have seen that coming!

Click here to view our video viewpoint.

Jeff Santosuosso

It was with sorrow we learned of the passing of Queen Elizabeth last week , a long and fruitful life in service to her country and countrymen. As an American, you grow up and are taught certain ideas about the British Monarchy and its role. But after living under the constitutional monarchy under the Queen, both in Australia and The United Kingdom, I gained a greater understanding and appreciation of the positive things they present.

And while I was in the UK, I quickly learned how adamant a supporter of Agriculture the Queen was. Of course well known for her love of horse racing, what was not well understood or appreciated was her steadfast support for farming and the ‘countryside’. She served on various Agricultural societies including the Young Farmers Clubs and The Great Yorkshire Show, a large agriculture event. UK farming will miss her steadfast loyalty and support.

Unlike Queen Elizabeth, many of our leaders across the world today do not really understand agriculture and its critical role in feeding the world and national security. They are too willing to trade off farming requirements for ‘green’ initiatives that many times inevitably damage or restrict farmer’s abilities to supply food to feed the world. For example, The Netherlands, a country that is twice the size of New Jersey, happens to be the 2^nd largest exporter of agricultural products in the world, behind the USA. Recent ‘green’ legislation passed by their government aims to reduce the number of farms by half, believing that this will benefit climate change. So now what? Where does the production go? And what about the loss of the farming industry? This could easily happen here; just look at California.

Recently the FDA announced its intent to open a dialogue on how to deal with ‘environmental claims’ on pharmaceutical products. We as an industry need to be very careful in how we address this issue as it may become a Pandora’s box. In principle, our products are developed to prevent or treat diseases. While some products may have collateral environmental benefits, if a pathway is developed to support such a claim, it may in fact be desirable. But it may end up being a future standard that does not fit all products, and even may be retroactively required of all. Be careful!

Paul Casady

For those who are Saturday Night Live fans from the late 70’s may recall Roseanne Rosannadanna’s famous line, “It’s always something.  If it’s not one thing it’s another”. Gas prices continue to decline.  Inflation rates are beginning to moderate.  It seems that the recent economic woes are stabilizing and even improving.

The cattle producing states are facing one of the worst droughts in recent history.  According to a new survey by the American Farm Bureau Federation, this year’s drought conditions are taking a harder toll than last year’s, as 37% of farmers said they are plowing through and killing existing crops that won’t reach maturity because of dry conditions. In addition, ranchers are being forced to sell off their cattle herds earlier than normal due to extreme drought, as water sources dry out and grass burns up. Ranchers in Texas reported the largest reduction in herd size, down 50%, followed by New Mexico and Oregon at 43% and 41% respectively.

In the short run, there should be reduction in beef prices as the additional supply works its way through the value chain, which is good.  However, in the medium/long term, prices should increase as supply moderates while ranchers rebuild their herds which can take years.  The animal health companies will likely be adversely impacted this year and into the future by losing potential doses of vaccines, antibiotics, parasiticides and hormonal implants as a result of early cattle harvesting and reduced herd sizes.

There are so many variables out of our control that impact key segments of the US economy.  Drought, floods, what’s next…pestilence?  Like Roseanne Roseannadanna said, “if it’s not one thing it’s another”.

Randy Freides

This week found me thinking more about innovation in the animal health industry, primarily driven by attending the 2022 Animal Health Corridor Summit on Monday and Tuesday.  KCAHC’s Kim Young and Emily McVey did a great job organizing a sold-out event that had a theme of brining innovation to our industry.

One half day of the Summit was dedicated to presentations from emerging companies, and I caught up with Tom Overbay of Expedite Animal Health, who led the coaching and selection teams for these start-ups, to find out more about them.  There were 32 emerging companies that applied to present at the Summit and of these, surprisingly, about 60% of them were focused on livestock and 40% on companion animals.  And of these 32, about 15% were product related, where an FDA/USDA approval would be needed and 85% were diagnostic or technology related.  Of the 12 finalist companies, 7 were diagnostic or technology related, and an emerging diagnostic company won the competition, Vidium Animal Health.

Fabian Kausche touched on this at the Summit in his presentation, titled “Transitions in Innovation in Animal Health” where he reminded us of the historical waves of innovation in animal health – we are in a technology-based wave of innovation.  But I cannot help but think expensive FDA user fees hamper drug innovation, a topic raised in a recent Viewpoint.

If you lead or know someone in an emerging company or would like to voice your opinion on FDA user fees and innovation, you have a chance to do so on September 6^th from 10-11 am.   Click here to join the meeting, where the FDA will be in “listening mode”. These sessions are generally very poorly attended.  Written comments may be also submitted to the docket at any time by clicking here and currently, there are very few comments posted.   Innovation in animal health is not easy, but perhaps if the FDA hears from you, they can help make new drug approvals easier.

Bob Jones

I was interested to read in this week’s news that VCA is launching an urgent care veterinary service. It marks VCA’s first effort to build rather than acquire veterinary hospitals. But more intriguing is the business model: they plan to offer only urgent care appointments for non-life-threatening conditions, with free teletriage to determine whether a pet needs urgent care, emergency care, or routine care from their regular veterinarian. They are also offering a ‘virtual waiting room’ so clients can wait at home until it’s time for their appointment. Given the widespread concerns about long waits to see both general practitioners and emergency-only practices, this seems to fill a need in the veterinary care space.  Urgent care facilities are well-established in human medicine; it will be interesting to follow this initiative to see if the urgent care concept takes off in the veterinary space.

Lynn Fondon

When our two daughters went to university, we encouraged them to participate in study abroad programs.  We also travelled internationally occasionally on family vacations because we felt it was important to gain on-the-ground understanding of other cultures and traditions.  This week’s newsletter really highlights the value of approaching life and work from a global perspective. Several items report on cross-border registrations, transactions and initiatives.  Today even small companies need executives familiar with the way pets and food animals are cared for in other parts of the world, and how business is conducted.  Given the investment required to develop and market innovative products, there’s no room for provincialism any more.  Success will go to those prepared to learn and adapt to more cultures.

John Volk 

We should not give up on developing a MLV vaccine for ASF.

In recent meetings with R&D leaders of domestic and international animal health companies in China, the topic of a modified live virus (MLV) vaccine for African Swine Fever (ASF) was often discussed. Most of these company leaders do not believe that an MLV vaccine will be approved by the Chinese regulatory agency anytime soon. The major concern is the safety of MLV vaccines.

The danger of an ASF MLV vaccine has been clearly demonstrated by the unauthorized introduction of various attenuated ASF viral strains as experimental vaccines in China in the last few years. These “less-virulent” MLV strains caused more damage than the wildtype ASFV because the disease became clinical when pigs grew older and were stressed.

However, we should not give up the hope that a safe and efficacious MLV vaccine for ASF is possible. Afterall, the safe and efficacious C-strain Classical Swine Fever (CSF) vaccine is an MLV vaccine and it has been successfully used to control CSF in many countries in the last few decades. Because MLV vaccines are often administered once and are more efficacious (quicker onset of immunity and longer protection) than subunit vaccines, they are usually a more cost-effective tool for infectious disease prevention and control compared to other types of vaccines. If an MLV ASF vaccine has a similar level of safety and efficacy profile as the C-strain CSF vaccine for CSF, it should be approved for use in ASF control and prevention.

Jishu Shi