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Animal Health News & Notes for August 30, 2002 - 3rd Anniversary Edition 8/30/2002

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Brakke Consulting’s
Animal Health News & Notes for August 30, 2002
Copyright © Brakke Consulting, Inc.
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COMPANY EARNINGS RELEASES
> PETsMART, Inc. announced results for its second
quarter, which ended August 4, 2002. The company
reported second quarter net income of $21.5 million versus a
net income of $2.8 million for the second quarter of 2001.
Net sales for the second quarter of 2002 were $651.5
million, compared to $582.4 million last year. Comparable
store sales grew 11.4% over the second quarter of last year.
Services sales for the second quarter were $39.5 million, up
31% compared with the second quarter of last year, an
increase that continues to reflect the company's focus and
investment in growing pet services. Year to date, sales
increased 11.4 percent, or $132.6 million, to $1.3 billion and
net income increased $39.6 million from the first half of last
year. (Business Wire)
> Ridley Inc. reported results for its fiscal 2002 fourth
quarter and year ended June 30, 2002. Ridley reported net
earnings of $4.5 million on sales of $156 million, compared
with a loss of ($10.4) million on sales of $160 million in the
fourth quarter of fiscal 2001. For the fiscal 2002 year,
revenues decreased by 1.0% to $690 million, due to volume
decreases in complete feed sales in the US Feed Operations
and Canadian Feed Operations. Net earnings for the year
were $15.0 million compared with $4.0 million in 2001.
(Business Wire)
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THE NEWEST BRAKKE CONSULTING STUDY IS HERE!
****Cancer in Dogs and Cats****
> Do you know the leading killer of dogs and cats in the US?
> Do you know the #1 health concern of US dog owners?
Both of these questions can be answered with a single word:
cancer. Pets are enjoying better health and wellness care
than ever before, and are living longer because of it.
Consequently, geriatric diseases are becoming more
commonplace, and cancer is at the top of the list.
How do veterinarians diagnose and identify cancer in their
patients? Which cancers are most commonly diagnosed?
What treatments are commonly used? Who actually
administers the treatment? What are the new and
experimental therapies being researched in veterinary
medicine? The answers to these questions and more are
answered in Brakke Consulting’s new report Cancer in
Dogs and Cats.
Find out where the market opportunities are in this growing
area of veterinary medicine. Brakke Consulting is now taking
orders for the August 2002 report “Cancer in Dogs and
Cats.” The report will be available for shipping by
September 13 at the latest.
You may order “Cancer in Dogs and Cats” or request more
information by calling the Dallas office at 972-243-4033, or
emailing Dr. Lynn Fondon at
lfondon@brakkeconsulting.com.
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COMPANY NEWS RELEASES
> Heska Corporation and Dolphin Medical, Inc., a
majority-owned subsidiary of OSI Systems, Inc. announced
a partnership to create and distribute advanced monitoring
tools to the veterinary marketplace. Under this partnership,
Heska will have exclusive distribution and marketing rights
for the veterinary market for Dolphin ONE (Oximetry Noise
Elimination) Pulse Oximeter technology. The partners hope
to bring additional high performance monitoring modalities to
the veterinary market in the future. (company press release)
> VCA Antech, Inc. announced that it successfully
refinanced its senior credit facility. The $143.1 million of total
outstanding Term A Debt and Term B Debt was replaced
with new Term C Debt in an equal amount, with a 63 basis
point reduction in the weighted average interest rate. For the
next twelve months, the reduction in rate will result in a net
annual pre-tax savings of approximately $900,000 in interest
expense. (Business Wire)
> Heska reported that it has been named to Inc. magazine’s
2002 edition of “The Innovation 50,” a listing of the top 50
companies in the US recognized for superior innovation.
The companies on the list had revenues of less than $100
million and accumulated 30 or more patents in the last 5
years. Heska ranked sixth on the list. (company press
release)
> ConAgra Foods Inc. announced that it expects Hicks, Muse,
Tate & Furst Incorporated and Booth Creek Management, Inc.
to wrap up their financing and close the previously announced
$1.4 billion Swift & Company transaction during September. As
a result of the transaction, Hicks, Muse and Booth Creek will
acquire control of one of the largest fresh beef and pork
operations in the U.S. and the premier beef processing
company in the Pacific Rim from Australia. (PRNewswire)
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ANIMAL HEALTH NEWS
> US Following the destruction of almost five million birds
on Virginia poultry farms since mid-March, federal agriculture
officials are reducing their Avian Influenza task force in the
area. According to agricultural officials, since July 2, tests on
Virginia poultry have all turned up negative for avian
influenza. No new cases have been reported in more than
two months in North Carolina and West Virginia. (Wattnet
Poultry)
> US GeneSeek Inc. and SEQUENOM, Inc. announced
that SEQUENOM has placed a MassARRAY system in
GeneSeek's new genetic analysis facility that will be used to
scan livestock for genetic variation for applications such as
gene discovery, trait testing, viral and bacterial identification,
parentage analysis and identity matching for accurate tracing
of meat products through the full chain of production. The
agreement with GeneSeek follows SEQUENOM's first
commercial MassARRAY system placement with the
Agricultural Research Service of the USDA, which
purchased a MassARRAY system as part of its program to
analyze SNP markers in livestock populations. (AnimalNet)
> US A researcher at the Texas Agricultural Experimental
Field Station has identified an oxidative stress assay that
may be a potential diagnostic predictor for bovine respiratory
disease (BRD). Cattle with low biomarkers before transport
were significantly more likely to require multiple postshipment
treatments for BRD. The assay used is
manufactured by Oxis International Inc. (Feedstuffs)
> US Researchers reported in the Journal of the American
Medical Association (JAMA) that infants living in a home with
two or more dogs or cats during the first year of life are less
likely to have the kind of allergic reactions that lead to
asthma and other problems later on. In addition the impact
of early exposure to the animals seems to have a protective
effect against other common allergens such as mold and
grass. (Reuters)
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Selected news events from the past 12 months of
Animal Health News & Notes
ACQUISITIONS & MERGERS:
08/01 Virbac acquires Helsinn Company of Portugal
08/01 Agristar Global Networks acquires DirectAg.com
08/01 Novartis acquires the product line of Selbruha of
Hungary
09/01 Land O’Lakes announces the acquisition of Purina
Mills
09/01 Smithfield agrees to acquire Packerland Holdings
09/01 Smithfield agrees to acquire Stadler Country Hams
and RMH Foods
10/01 Church & Dwight completes its acquisition of Carter-
Wallace’s consumer products business, including the
Lambert-Kay pet products line
10/01 Bayer acquires Aventis CropScience
10/01 Bioniche Life Sciences acquires Horizon Technology
of Australia
10/01 Archer Daniels Midland announced the merging of
Moorman’s and Consolidated nutrition in to a single
company called ADM Alliance Nutrition
10/01 Royer Biomedical spins off its animal health division
to form Royer Animal Health
10/01 Shionogi Pharmaceuticals of Japan and Boehringer
Ingelheim Vetmedica announce a collaboration to sell BIV’s
product in Japan
11/01 CVC Capital Partners acquires Aventis Animal
Nutrition named Adisseo)
11/01 Excel Corp. announces its intent to acquire Taylor
Packing Co.
11/01 Daiichi Pharmaceuticals, Fuji Chemical Industries
and Daiichi Fine Chemicals agree to merge to form a single
company
11/01 Ivy Animal Health announces the purchase of the
Compudose and Encore implants from Elanco
12/01 the FTC approves Nestle’s acquisition of Ralston
Purina, with some sell-offs stipulated
12/01 TruePaws pet insurance ceased business
01/02 Smithfield Foods announces an agreement with
Artal Holland for a joint venture in China
01/02 Seghersgenetics and Newsham Hybrids agree to
merge
01/02 Monsanto acquires Unipork Genetics from United
Grain Growers
01/02 Sergeant’s Pet Care acquires pet treat brands from
Pet Life Inc.
01/02 Novartis acquires Grand Laboratories and ImmTech
Biologics
01/02 Church & Dwight acquires Biovance Technologies
01/02 Farnam acquires the Equi Aid line of horse products
02/02 Vetoquinol agrees to acquire IGI’s line of companion
pet products (Evsco Pharmaceuticals)
02/02 The EC approves Mars’ acquisition of Royal Canin
02/02 Ivy Animal Health completes its purchase of AgSpan
Inc.
03/02 MetaMorphix acquires the animal genomics and
genotyping business of Celera
03/02 Friona Industries agrees to sell Hi-Pro Animal Health
to Walco International
03/02 The Butler Company acquires DVM Manager
veterinary business software
05/02 Coopers Brazil (Schering-Plough) acquires the
veterinary division of Quimica Farmaceutica Schering-
Plough
05/02 Ridley agrees to sell its European swine breeding
and genetics business to JSR Newsham Ltd
05/02 Schering-Plough acquires Aquaculture Vaccines of
the UK
05/02 The parent company of Swift & Co agrees to acquire
ConAgra Meats
05/02 Meow Mix cat food is bought out by management to
form an independent company
06/02 CVC Capital Partners announces intent to acquire
Provimi of Italy from Montedison
06/02 Del Monte Foods agrees to sell its pet food and
other divisions to H.J. Heinz
07/02 Novozymes acquires George A Jeffreys
07/02 Pfizer announces the planned acquisition of
Pharmacia for $60 billion
PRODUCT LAUNCHES AND APPROVALS:
08/01 Heska launches Allercept E-Screen Test
09/01 Virbac launches Worm-X canine intestinal dewormer
09/01 Ecolab receives FDA approval for its Inspexx 100
antimicrobial food treatment
10/01 Virbac receives FDA approval for Virbamec and
Bovimec ivermectin pour-ons for cattle
10/01 Iams introduces Dental Defense to its line of
Eukanuba Veterinary Diets Senior Plus and Eukanuba dog
and cat foods
10/01 Merial launches Purevax Ferret Distemper Vaccine
10/01 Idexx launches its IndicatoRx test for bacterial
urinary tract infections
11/01 Iams launches Iams Active Maturity Hairball Care
and Iams Weight Control Hairball Care cat foods
11/01 Safepath Labs launches its Trichinella Swine
Antibody ELISA test
11/01 Merial relaunches Recombitek Canine Vaccines
11/01 Virbac launches First Sight, a plaque-disclosing
solution for dogs and cats
11/01 Ralston Purina launches its Glucotest Feline
Glucose Detection System
11/01 PRN Pharmacal introduces Collasate collagen
wound dressing
11/01 Readers Digest launches PetCare Pet Insurance
Programs
12/01 Pfizer receives FDA approval for once-daily dosing
for Rimadyl
12/01 First Priority receives FDA approval for an ivermectin
product for horses
12/01 Abaxis announces the introduction of the VetScan
Canine Heartworm Antigen Test
12/01 Immucell receives USDA approval for Tip-Test BLV
bovine leukemia test
01/02 Biocor Animal Health receives USDA approval for its
Bovigam-TB bovine tuberculosis test
01/02 Biogal Galed Labs announces the introduction of
their Immunocomb IgM antibody tests for Canine Distemper
and Canine Parvovirus
01/02 Safepath Labs announces the launch of their
Toxoplasma Swine Antibody ELISA test
01/02 Virbac receives FDA approval for Iverhart canine
heartworm prevention
01/02 Intervet receives USDA approval for NeoGuard
bovine neosporosis vaccine
01/02 Heska announces the launch of the E.R.D Screen
Urine Test fir renal disease
02/02 Schering-Plough launches the Auriflush ear wash
system
02/02 Nutramax Labs introduces Cosequin for Cats
Flavored Sprinkle Capsules
02/02 The FDA approves Boehringer Ingelheim
Vetmedica’s Torpex Aerosol, an intranasal aerosol of
albuterol for horses
02/02 First Priority announces FDA approval of its topical
chlorhexidine ointment for dogs, cats and horses
03/02 Farnam announces the Farnam-owned brands of
equine ivermectin dewormers, Ivercare and Rotation 1, with
the return of Zimectrin and Equimectrin names to Merial
03/02 Fort Dodge receives USDA approval for its FIV
vaccine for cats
03/02 ImmTech Biologics announces its receipt of a
conditional USDA approval for its Treponema Bacterin for
heel warts in dairy cattle
03/02 Farnam introduces Equi-Spot insect repellent for
horses
03/02 Virbac launches Allermyl Shampoo for pruritus
05/02 Neogen launches Agri-Screen for Ruminant MBM to
detect ruminant by-products in animal feed ingredients
05/02 Novartis receives FDA approval for Percorten V to
be used to treat canine Addison’s disease
05/02 Virbac rolls out its Virbagen Omega veterinary
interferon across Europe
05/02 Novartis relaunches Econor in the EU
06/02 Pharmacia announced the FDA approval of the
Eazi-Breed CIDR for cattle
07/02 Novartis launches Atopica canine atopic dermatitis
treatment in Australia
07/02 Virbac launches the Preventic Plus collar with
amitraz and pyriproxyfen
07/02 The American Kennel Club partners with
PetPartners to provide canine health insurance
07/02 Intervet receives OTC status for fenbendazole
granules for dogs
07/02 The Butler Company launches Nutrisentials “Lean
Treats” for dogs
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BRAKKE CONSULTING VIEWPOINT
You can see by the list of mergers and acquisitions above
that a great deal of the news in the industry for the past 12
months revolves around consolidation. We believe this trend
will continue for the next few years. With innovative
research spending as a percent of sales continuing to fall in
the industry, companies will need to either acquire
technology or companies to maintain satisfactory growth
levels.
While the number of new products introduced are mainly the
US and not inclusive of all introductions, the list has no
products that would be considered blockbusters and only a
handful that would have sales in excess of $5 million per
year. We believe that this reflects a lack of new compounds
and new technologies available for animal health. If a
market category is to grow in excess of 5% per year there
will need to be a commitment to basic R&D for innovative
products. While there are still opportunities to increase
compliance and expand the user base for some current
products, this area is not likely to provide sufficient growth
levels over a sustained period. In the budgeting process for
2003 and beyond, we strongly recommend a commitment to
innovative research.
Have a safe and enjoyable Labor Day Weekend.
[Ron Brakke]
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For more information about Brakke Consulting’s services
and syndicated studies, visit our website at
www.brakkeconsulting.com.