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Animal Health News & Notes for January 25, 2008 1/25/2008

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Brakke Consulting's
Animal Health News & Notes for January 25, 2008

Copyright © Brakke Consulting, Inc.
Editor: Lynn Fondon, DVM, MBA

earnings news

PetMed Express
Virbac SA
other news
France Hybrides
Hendrix Genetics (France Hybrides)
Hendrix Genetics (Cobb Vantress)
Meridian AH
Smithfield Foods
Tyson Foods (cloning)
Tyson Foods (Luminex)
Wedgewood Pharmacy (Tiny Tabs)
Wedgewood Pharmacy (FLAVORx)
2008 U.S. Animal Health Industry Overview
As we've done for a number of years, Brakke Consulting will be presenting our 2008 Animal Health Industry Overview at the Western Veterinary Conference.
Tuesday, February 19, 2008
2:00 - 4:00 pm
The Overview will contain industry highlights and the 2008 outlook, industry statistics in key product markets, recent financial/acquisition activity, observation of leading companies, veterinary practice trends update, summary data from Brakke multi-client studies, and more.  To register, go to www.Brakkeconsulting.com and follow the link to register for the Overview at the WVC.
> Pfizer reported results for the full year.  Animal Health revenues were $2.6 billion, an increase of 14% compared with $2.3 billion in 2006. Revenue growth was attributable to strong product performance, as well as the favorable impact of foreign exchange which increased revenues by 5% for the full year. (company website)  
> Virbac SA reported preliminary results for 2007. Sales for the year were EUR 439 million ($646 million), an increase of 9% compared to 2006 (12% at constant exchange rates).  At constant exchange rates, companion animal sales grew by 11%, due mainly to the launch of new products in Europe and the US.  Food animal sales benefited from Indian and Italian acquisitions and grew 15%. (company website)
> Vétoquinol reported financial results for 2007.  The company earned revenue of EUR 233 million ($343 million) in 2007, a 10% increase compared with the same period one year earlier. On a constant exchange rate and scope of business basis, revenue growth for 2007 was 7.6%. Revenue growth was attributable in particular to higher sales for the product portfolio, as well as to the introduction of new drugs and the full-year integration of Vet Solutions into Vétoquinol USA. (Business Wire)  
> IDEXX Laboratories, Inc. reported financial results for 2007. Revenue for the year ended December 31, 2007 increased 25% to $923 million. Revenue for the year adjusted for the impacts of acquisitions and foreign currency exchange rates increased 14%. Companion Animal Group revenues were $752 million, an increase of 24% compared to the prior year. (company website)  
> PetMed Express, Inc. announced its financial results for its third quarter ended December 31, 2007.  Net sales for the quarter were $37 million, an increase of 19% compared to  the quarter ended December 31, 2006.  Net income was $4.4 million for the quarter, an increase of 60% compared to the comparable period in the prior year. (company website)   
> Merial announced the addition of a somatic cell score (SCS) analysis to the comprehensive IGENITY profile. Genetic markers also have been added to the analyses for productive life (PL), fertility and milk production, making the profile more powerful than before. (company press release) 
> Meridian Animal Health, LLC, announced its entry into the companion animal veterinary medicine channel  with a new line of innovative products available exclusively through veterinarians.  Initial products from Meridian Animal Health include liquid sutures and bandages; fly and mosquito repellant spray for horses; natural flea, tick and mosquito control for dogs and cats; and natural calming agents and joint therapy for pets.  (PRNewswire)
> Vet-Stem nationally unveiled its online veterinary training course to small animal veterinarians. Once a veterinarian completes the company's Vet-Stem Regenerative Cell (VSRC) therapy credentialing course, they will have the education to use VSRCs to treat arthritis, fractures and tendon and ligament injuries in dogs. Vet-Stem is also studying the use of VSRC therapy for other diseases in dogs and horses. (company press release) 
> The Veterinary Division of FLAVORx, Inc., and Wedgewood Pharmacy have teamed up to provide a new, convenient option for veterinarians to make pet medications taste good.  The FLAVORx system provides recipes that veterinarians use to add flavors to specially-formulated prescription suspensions from Wedgewood Pharmacy. (company press release) 
> Wedgewood Pharmacy introduced Tiny Tabs, a 6.25 mm-diameter, custom-compounded tablet dosage-form for pilling finicky pets who won’t cooperate and take their medicine in a treat form.  The small size of Tiny Tabs makes it easier for pet owners to pill animals, especially with difficult-to-administer and bitter-tasting medications.  Tiny Tabs are about one-half the size of a Tic-Tac breath mint and cost up to 70% less than other dosage forms, such as capsules. (company press release)
> Smithfield Foods reiterated its position that the company isn't planning to produce meat from cloned animals. Tyson Foods also said cloned animals are not in its plans, explaining that whatever measures the company ultimately takes will be guided by government regulations and the desires of consumers and its customers.  (Pork Alert) 
> Luminex Corp. and Tyson Foods Inc. have reached a collaboration agreement to create faster, more accurate and cost-effective food safety and animal health tests. The first collaboration is the development of an avian flock health monitoring panel. Future research and development projects slated are focused on food safety and quality tests, and additional animal health diagnostic panels. (ohsonline.com)
> Hendrix Genetics B.V. announced a memorandum of understanding with Groupe Glon in France to acquire Groupe Glon's swine genetics division, France Hybrides. The company will be integrated into its own swine breeding division, Hypor. Financial terms were not disclosed. (Feedstuffs)
> Hendrix Genetics B.V. announced a memorandum of understanding with Cobb-Vantress Inc. whereby Cobb will acquire Hendrix's Hybro chicken breeding business.  The two companies will also launch a company to jointly develop poultry and swine genetics.  Financial terms were not disclosed. (Feedstuffs) 
> Kemin Industries announced the availability of PB6, a new direct-fed microbial for dogs.  This proprietary Bacillus subtilis strain is an all-natural, non-genetically modified organism supplement for gastrointestinal health.  The product has a high survivability factor during manufacturing and while the product is on the shelf.  (Feedstuffs)
> US - BOVINE TB   A beef cattle herd south of Roseau, Minn., has tested positive for bovine tuberculosis, signaling a setback in the state's quest to regain TB-free status. The latest infected herd is located "a few miles south of Roseau" and is within a special TB management zone that was set up after another herd turned up positive for the disease in 2005 near Salol, Minn. Minnesota has now detected bovine TB in nine beef cattle herds, all roughly within 10 miles of each other in Roseau County. (Grand Forks Herald)
>  US - ZOONOTIC DISEASE INITIATIVE   The Kansas Bioscience Authority (KBA) has launched a $2.5 million initiative to develop plans to protect people and businesses against the malicious use of animal-borne diseases. The Collaborative Biosecurity Research Initiative (CBRI) aims to support research through developing countermeasures for foreign-animal diseases by strengthening institutional biosecurity capabilities. It will support the licensing of vaccine countermeasures, and provide advanced diagnostic capabilities and threat detection. The CBRI will provide up to $500,000 to investigators working on projects that partner with the University of Kansas's new biocontainment facility, the Biosecurity Research Institute (BRI). (Animal Pharm)
> US - ANIMAL HEALTH MBA   The University of Kansas is expanding its animal health-oriented Master of Business Administration program to accommodate needs of another four major employers in the area who are considered major players in animal-health products and sciences.  In addition to Bayer Animal Health, which was first to take advantage of the program and already has one student enrolled, KU is working with Hill’s Pet Nutrition Inc., Ceva Biomune, Boehringer Ingelheim Vetmedica Inc. and Fort Dodge Animal Health to educate rising executives.  (AnimalNet - LJWorld)

The 2007 Distributor Effectiveness Study is a follow-up to the original 2003 study.  The study utilizes a quantitative survey of over 1,000 companion animal veterinarians to identify what they view to be the most important traits of a distributor, and to have them rate the performance of distributors that serve their practices on approximately 40 business activities and measures.
The 2007 DES provides insight about some of the major changes in the marketplace since 2003 that have affected veterinarians’ relationships with their distributors such as:
  - Mergers and Acquisitions: At least half of the top 10 distributors in 2003 have either been acquired or merged with other companies.
  - Geographical Expansion: Several strong regional distributors have expanded to new market areas or grown to become national companies.
  - National and Regional Market Shares have changed dramatically for some companies and regions.
The report is now complete and available for purchase.
For details, contact Project Manager Jay Lockhart at
(314) 821-3368 or jlockhart@brakkeconsulting.com 
North American Veterinary Conference
January 19 - 23
Approximately 14,500 people registered for the North American Veterinary Conference (NAVC) for the first two days, setting a new attendance record.  Included in the registered attendees were 5,700 veterinarians; 1,600 veterinary technicians; 680 practice managers; and over 3,600 exhibitors. 
It was great to see so many of you in Orlando earlier this week.  As noted above, the NAVC was a record show from most viewpoints.  Other than a need to shuttle between hotels, it is hard to come up with much to criticize from this meeting.  Congratulations to Dr. Colin Burrows and his staff for another successful year. 
The first companies have started to officially report and it appears that they will not disappoint related to their performance in 2007.  It’s a bit hard to fully understand unit volume when one has to adjust for currency, inflation and new product introductions.  However, it’s clear that 2007 was a great year for animal health. 
What does 2008 look like?  We asked this question of 100-plus managers attending our Overview in Orlando.  65% felt the business would grow, 30% felt the business would be flat and only 5% thought it would decline.  So, let’s hope the majority is correct.  For ourselves, we believe there will be growth in 2008, but not at the same rate as 2007.  After all, the industry needs a bit of a cooling off period after the last couple of years. 
Have a good 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.
Brakke Consulting, Inc.
2735 Villa Creek, Suite 140
Dallas, TX  75234    USA