The Experts in Animal Health

Brakke Viewpoints

We are the experts in animal health

Brakke Viewpoint January 19, 2024

I might not be the best judge of vibes, but there was a pretty good vibe going on this week at the NAVC’s VMX veterinary expo in Orlando.  The event was well attended, again over 27,000 attendees, and many people felt that we have finally moved on from the disruptions caused by the pandemic − business was back to normal, like the old times.

Unlike the old times, the convention show floor seemed to have moved on to new, bigger times – there were some amazingly large, open, airy, and welcoming booths that were attracting lots of visitors.  These booths were full of technology, from large screens to personal digital interactions, aiming to educate and inform.  Companies have been changing to open and technology-driven booths for years now, but the number and size of them seemed noticeable this year.

But, as many readers know I like to say, “it’s all about people” and this is why VMX is always a great way to start the year.  Between old and new colleagues, reunions of people from companies that don’t exist any longer, and new companies entering the animal health industry, this is a great people event as we all begin a new year.  If you missed VMX, you have one more chance… see you next month at Viticus’ WVC.

Bob Jones

Brakke Viewpoint January 12, 2024

Innovation in veterinary medicine can take many forms.  It could be groundbreaking new drugs or non-pharmaceutical therapies.  It could be novel technologies that help veterinarians practice better medicine, or streamline practice workflows. It could be new ways of delivering veterinary services, from telehealth to incorporating artificial intelligence. It could manifest as new models for veterinary practice.  We’ve seen all of these impact the field of animal health in recent years.

Innovation can be exciting, but it can also sometimes feel threatening. Today’s veterinary practices are facing challenges to the “traditional” way of doing business, from the loss of product sales to retail & online pharmacies, to the push for broadening the use of telehealth and AI-based tools.  It is up to us as a profession to embrace innovation to better serve our clients and patients. Are you ready?

Lynn Fondon

Brakke Viewpoint January 5, 2024

Happy New Year!

You can tell it’s January and VMX is around the corner by all of the announcements in this week’s newsletter.  Today’s newsletter also is a great reflection of the animal health industry: the announcements are global in nature; numerous transactions are in the works; new products are announced; quarterly earnings are reported; there are new FDA registrations for some products, and additional label claims for others; a new veterinary school has been approved; and states are changing their regulations regarding pet sales and telemedicine.  No doubt  you’ll be hearing more about all of these topics and more at the upcoming veterinary conferences.

As we do every year at this time, we’ll take a look back and a peer forward to distill a picture of what the industry accomplished in 2023, and where it’s likely headed in  2024.  We’ll share those observation in the annual Brakke Industry Overview.  There’s an announcement about the Overview at VMX and WVC in this newsletter.  If you’re attending VMX and haven’t registered yet, I encourage you to do so.  Seats are limited.

We look forward to seeing many of you in Orlando.

John Volk, Senior Consultant

Brakke Viewpoint December 15, 2023

Which country around the world has the highest ratio of veterinarians per capita?  If you said Lativa, you’d be right.  Latvia has a population of 1.9 million people and has 129 veterinarians per 100,000 inhabitants.  Which country is second?  That would be the country where I am from, Brazil, which has 77.4 veterinarians per 100,000 inhabitants, or 166,119 practicing veterinarians in a population of 214 million.  By contrast, the average across Europe is 38 veterinarians per 100,000 inhabitants.

Brazil may be experiencing a new boom in veterinary medicine, with the development of new veterinary specialties and a consequent increase in the standard of care for dogs and cats. This is a great opportunity for companies in the sector.

Despite this, there is a worry that there are too many veterinarians in Brazil.  Many feel that this oversupply has led to stiff competition for jobs, lower salaries, and a decline in the quality of veterinary care.

Perhaps the oversupply of veterinarians is starting to impact younger veterinarians as a recent study shows a much greater level of dissatisfaction with their veterinary medicine coursework than older veterinarians.  It would be a shame that as Brazil’s resilient economy strengthens and veterinary services for pets improves, veterinarians are more unhappy.

Mauri Ronan Moreira

Brakke Viewpoint December 8, 2023

This week’s newsletter highlights Blackstone’s acquisition of Rover Group, Inc, the world’s largest network of dog walkers and pet sitters, for $2.3 billion.  The Seattle-based company, started in 2011 with a simple plan of connecting pet parents with pet service providers via their Rover.com app and website in North America and Europe.

Fast forward ten years to August 2021, shares of ROVR start trading on Nasdaq.  After weathering financial losses from decrease in pet sitting services during COVID pandemic, Rover saw strong recovery on accelerated demand due to workers’ return to office, increased travel and the ‘pandemic pet’ phenomenon.

Now, Rover is acquired for billions of dollars.  From 2011 through the end of September this year, more than 93 million services have been booked by more than 4 million pet parents through 1 million pet care providers paid across North America and Europe.  Most of this growth has come organically – by word of mouth.

After a recent knee surgery, I used Rover for the first time to avoid inconveniencing friends and family with dog duties.  The app was easy to navigate, the booking process was simple, and found several well-qualified dog walkers.  I had an immediate need and Rover provided an elegant solution.

Today’s pet owners are willing to pay premium prices for high-quality care, flexibility, and convenience.  And today, Blackstone is willing to pay a lot of money for a pet services app.  Which app is next?

Richard Hayworth

Brakke Viewpoint December 1, 2023

This newsletter contains a reference to a new drug in development by Loyal (part of Cellular Longevity, Inc. of San Francisco, CA.).  Loyal’s drug, identified only as LOY-001, may eventually be approved to provide life extension in dogs.  This week, Loyal released a widely reported conclusion by the US FDA that “the data you provided are sufficient to show that there is a reasonable expectation of effectiveness,“ which could lead to conditional approval by FDA as early as 2026.

LOY-001 is thought to modulate insulin growth factor-1, or IGF-1, which is associated with aging and longevity, and in dogs is known to play a role in determining body size.  This initial offering is expected to be available as an extended release implant for use in large adult dogs, which generally have shorter lifespans than small dogs.  Several other products are also in Loyal’s pipeline as follow-on compounds to also provide extended life in adult dogs, and may be effective in oral form as well.  Other companies and research institutions have also announced other projects focused on this same goal of extending lifespans in dogs (which of course could lead to similar work in humans).

While in its infancy, this work could profoundly affect the health (and the lifespans) of pets and therefore the practice of veterinary medicine.  We’ll keep an eye on these trends and try to keep you up to date on the progress as these drugs move forward.  Success is not guaranteed; but innovation will proceed no matter what!

Jim Kroman

Brakke Viewpoint November 22, 2023

Believe it or not, Thanksgiving is right around the corner and plans for the family dinner are beginning to take shape.  Families are determining how large a turkey will be needed to feed everyone.  Given the inflationary environment we are experiencing, one question on the minds of shoppers is how much will this year’s turkey cost?  Turkey prices hit an all-time high in 2022 primarily as a result of the impact that Highly Pathogenic Avian Influenza (HPAI) had on turkey flocks

Well, HPAI is back.  This virus is like the horror film character, Jason, from the “Friday the 13th” movies…it just keeps coming back for more.  According to the USDA, 14 states have reported outbreaks since the 2023 fall bird migration began.

Fortunately, turkey supplies have recovered since the HPAI outbreak began in 2022.  The USDA’s annual “Turkey Raised report” estimates that 219 million turkeys were raised in 2023, an increase of +4% from 2022 and 1% above pre-HPAI outbreak levels in 2021.  Live weights are also up by 3.8% vs. 2022, in addition to increases in the numbers of turkeys raised.

Despite the spreading of HPAI, average turkey prices have fallen from $1.63/lb. in 2022 to $1.27/lb. in 2023 for an 8-16 lb. turkey due to increases in production.  This is a positive sign for those tasked with feeding hungry friends and relatives.  Eat and be merry!!!

Randy Freides

Brakke Viewpoint November 17, 2023

Hope for the Human Race

Now that I have your attention, I would like to explain the context behind the headline: The Zero By 2030 initiative for eliminating human deaths from rabies; and resulting pleasure of working collaboratively across private and public organizations towards a common goal.

Last week I attended the United Against Rabies consortium annual meeting, which includes WOAH, WHO, FAO, and UNEP, along with industry, and representatives from around the world – in particular from the most affected countries in Africa and Asia. This group has the stated mission to eliminate deaths from rabies in humans, which predominately comes from infected dogs. WOAH leads the effort behind Dr. Rachel Tidman, who works tirelessly across the world and organizations to move the group towards achieving this worthy objective.

At this year’s summit, which was hosted at the FAO headquarters in Rome, the group welcomed GAVI, which is the preeminent global vaccine alliance for humans into the effort. This means the Human Rabies vaccines will be included on their list of subsidized vaccines, which will create a real ‘One Health’ approach to solving the issue.

The energy of the group is incredible, which was augmented by the FAO HQ environment. We intermingled at lunch with the local FAO staff, and I was summarily impressed by everyone I talked to. The FAO is dedicated to sustainability and defeating hunger and the people there are fully committed to the objective. It was fun to be amongst them, if only for a short while.

Between the Zero by 2030 group, and FAO staff, I still believe there is hope for mankind!

Paul Casady

Brakke Consulting Viewpoint November 10, 2023

I recently read an article in the Wall Street Journal titled, “You Can Tell Rover He’s a Bad Dog From 3,000 Miles Away”.  I laughed at some of the video clips attached to the article.  The article highlights how technology, and the use of home video cameras are being used to monitor pet behavior while we are out of the house or at work.

I find this a complete violation of pet privacy.  What happens when left alone adds to the surprise when you return home.  Gone are the days when you come home to find the trash strewn over the kitchen floor, pillows and shoes being shredded and plants being knocked over.  What has this world come to?

In the article pet trainers are asked how best to eliminate bad behaviors.  Scolding your dog or providing treats to distract them from their bad behavioral choices might not be the best approach.  They say the attention gained during periods of bad acting reinforces that behavior.  Trainers suggest talking to your pet when they are behaving well and reward proper behavior vs. negative reinforcement of bad behavior.

Technology is all around us: GPS tracking, remote treat dispensers, video cameras, etc. Our pets can’t get away with sneak attacks on the garbage pail or worse yet, the Christmas tree any longer.  I only hope governments don’t take extreme measures, implementing laws protecting the privacy of our pets while they are home alone.

Randy Freides

Brakke Viewpoint November 3, 2023

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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"Brakke Consulting Animal Health News & Notes” provides a summary of relevant articles, as well as the Brakke Consulting Viewpoint on the news and major industry meetings. The newsletter is available at no charge to individuals involved in the animal health industry.
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