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Animal Health News & Notes for April 18, 2008 4/18/2008

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Brakke Consulting's
Animal Health News & Notes for April 18, 2008

Copyright © Brakke Consulting, Inc.
Editor: Lynn Fondon, DVM, MBA
earnings news
other news
BCP Veterinary Pharmacy
Blue Seal Feeds
Groupe Grimaud
Nestle Purina PetCare
Newsham Choice Genetics
Nutramax Labs
Pilgrims Pride
United Cooperative Farmers
Brakke Consulting is pleased to announce the publication of an all-new report on the US market for small package generic products.  The report is an in-depth look at a part of the market that intrigues many industry participants.  The report includes such information as:
- the origin and evolution of animal health generics
- estimated market size and characteristics
- generics use in large vs. small animals
- profiles of generics manufacturers
The report also includes surveys of several hundred large and small animal veterinarians and producers, probing their understanding and perception of generic products, current and expected future usage.
The report is in final production and will begin shipping next week.  The report can be purchased for $8,500. For more information, contact project manager Dr. Lynn Fondon at lfondon@brakkeconsulting.com
> Pfizer reported financial results for the first quarter of 2008.  Animal Health revenues for the quarter were $619 million, an increase of 6% compared with the year-ago quarter, driven by the favorable impact of foreign exchange, which increased revenues by approximately $35 million or 6%. (company website) 
> Virbac SA reported results for the first quarter of 2008.  Provisional net sales for the quarter were EUR 103 million ($163 million), a decrease of 1% compared to the first quarter of 2007.  Sales were affected by the sharp rise of the euro and the divestiture of a nonstrategic OTC business in the US in early 2008.  At constant scope and exchange rates, sales increased 5%. (company website) 
> Merial announced that Previcox has received FDA approval to expand its label claim to include the control of postoperative pain and inflammation associated with soft tissue surgery in dogs.  (DVM Newsmagazine) 
> Nestle Purina PetCare announced plans to introduce a two-tiered pet insurance program this spring.  The insurance plan will offer two options with a variety of monthly premiums and deductible levels.  A preventive care plan will also be available. (DVM Newsmagazine)
> Nutramax Labs announced the launch of Cosequin HA+ASU Treats for horses.  Cosequin Treats contain a high-quality hyaluronic acid along with avocado/soybean unsaponifiables for joint health. The company also announced the launch of Proviable priobiotics for dogs and cats in two formulations: one containing kaolin and pectin in addition to the probiotic organisms.  (DVM Newsmagazine)
> Meridian Animal Health announced the introduction of several new products.  Ectopamine is a naturally effective flea, tick and mosquito control product for dogs and cats with a patented blend of natural active oils. Tryptocalm LT is a supplement containing tryptophan, formulated to manage common behavioral problems in dogs. Epi-Heal is a quick-healing liquid bandage; and Surgi-Lock 20C is a suture application to prevent suture pull-through. (DVM Newsmagazine) 
> BCP Veterinary Pharmacy announced the launch of BCP BNT, a proprietary formulation compounded with enrofloxacin, ketoconazole, and triamcinolone to treat ear infections in horses. (DVM Newsmagazine)  
> Blue Seal Feeds announced it has acquired the assets of United Cooperative Farmers Inc. (UCF), a farmer-owned feed manufacturing and animal nutrition company serving New England and New York.  Financial terms were not disclosed. (Feedstuffs)
> Pilgrim's Pride announced plans to decrease its weekly chicken numbers by 5% in its fiscal 2008 second half, which began this month. The move is part of a continuing effort to better balance demand and supply amid record-high costs for feed ingredients.  The reduction will be in effect until average industry margins return to more normalized levels. Other poultry integrators have announced similar cutbacks. (Feedstuffs)
> Newsham Choice Genetics and Groupe Grimaud, the second-largest poultry genetics supplier in Europe, announced this afternoon a long-term strategic alliance that will accelerate Newsham's business development outside North America. (Feedstuffs) 
>  OrthoView announced the introduction of OrthoViewVET, a digital planning and templating solution for veterinary small animal and equine orthopedic surgeons. Providing templating for joint replacement, fracture management, limb deformity, and general measurement, OrthoViewVET can be integrated into any CR/DR or PACS solution. Alternatively, the new veterinary orthopedic application is also available as stand-alone software. (PRWeb)
> EU  Vetoquinol and Jurox Pty Ltd. announced the imminent pan-European launch of Alfaxan (alfaxalone), an injectable anesthetic for the induction and maintenance of anesthesia in dogs and cats.  Alfaxan will be launched in France, Germany, Spain, Netherlands, Belgium, and Ireland; the product was launched in the UK in 2007. (company website)
> US - ANIMAL TRACKING   The USDA reported that it has purchased a total of 1.5 million "840" RF animal identification tags to support animal disease control programs, including the bovine TB and brucellosis programs. The tags provide for individual identification of livestock through a 15-digit number. The goal is to link the cattle to their premises of origin, so that if there is an outbreak in the future, the movements of the infected animals can be quickly traced. (Meating Place)
> SOUTH KOREA - BEEF MARKET OPENED TO US  The Office of the US Trade Representative announced that South Korea has agreed to open its market to all US beef products from cattle of all ages. The new protocol will take effect in mid-May.  South Korea had closed its market to US beef and beef products after a case of BSE was discovered in the US in December 2003. Prior to this time, South Korea was the third-largest export market for US beef and beef products. (Meating Place)
> US - HOG MARKETS   Financial losses on raising hogs are reaching record proportions, and could be as high as $60 per head come fall, according to Steve Meyer and Len Steiner, agricultural economists and authors of the Chicago Mercantile Exchange's Daily Livestock Report. Losses in March were the third-worst on record, at an estimated $39.49/head. Sow slaughter rates in the US and Canada are picking up, which will reduce the size of the breeding herd and support prices. However, it could be 12 to 18 months before those reductions work their way through the system and begin to have an effect on prices. (Meating Place)
The first companies have reported for the first quarter of 2008 and it appears that if it were not for the exchange rates, sales volumes would be below both expectations and last year's sales.  We’ll wait for additional companies to report before we start drawing conclusions, but it appears that economic conditions are beginning to have a negative impact when compared to the past two years.  We’ve been on the road the past few days and those we have visited with seem to confirm some softness in the business. 
What concerns us more for the future quarters is the reported decline in placements of either poultry or livestock by some of the larger integrators or producers.  If the animals or birds are not there, it’s hard to sell products for them.  We believe that belt-tightening will continue at all levels of the industry until there is some more positive news to encourage expansion.  Our advice to management is to keep your eye on creating or maintaining sales volume without increasing prices.  Some discipline in cost control is probably also appropriate at this time. 
Have a great weekend. It appears the winter might finally be over in the Midwest!!
Ron Brakke
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