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Animal Health News & Notes for October 26, 2007 10/26/2007

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Brakke Consulting's
Animal Health News & Notes for October 26, 2007

Copyright © Brakke Consulting, Inc.
Editor: Lynn Fondon, DVM, MBA
earnings news
Maple Leaf Foods
PetMed Express
VCA Antech
other news
Axiom Allergyvet
Digital Angel
DVM Resources
Global Animal Management
> Merck & Co., Inc. announced third-quarter 2007 financial results. Sales of joint venture Merial were $583 million, an increase of 9% compared to the third quarter of 2006. (company website)
> Schering-Plough Corporation reported financial results for the third quarter of 2007. Animal Health sales increased 8% to $248 million, reflecting solid growth internationally, led by the poultry, companion animal, aquaculture and swine product lines, coupled with a positive impact from foreign currency exchange rates. The growth in international markets was tempered by a decline in the US. (company press release)
> IDEXX Laboratories, Inc., reported that revenue for the third quarter of 2007 increased 22% to $229 million from $187 million for the third quarter of 2006. Companion Animal Group ("CAG") revenue for the third quarter of 2007 increased 22% to $188 million from $153 million for the third quarter of 2006 due primarily to higher sales in all CAG product and service categories. Incremental sales from acquired businesses contributed 6% to revenue growth. (PRNewswire)
> VCA Antech, Inc. reported financial results for the quarter ended September 30, 2007.  Revenue increased 22% to a third quarter record of $307 million; net income increased 20% to $32 million. (company press release) 
> Abaxis, Inc. reported financial results for the fiscal quarter ended September 30, 2007.  Veterinary revenues for the quarter were $18.0 million, compared to $15.2 million in the comparable quarter in 2006. (company website)
> PetMed Express, Inc. announced financial results for the quarter ended September 30, 2007. Net income was $4.5 million for the quarter, an increase of 37%.  Net sales for the quarter ended September 30, 2007 were $51.5 million, compared to $43.8 million for the quarter ended September 30, 2006, an increase of 18%. (Business Wire)
> Maple Leaf Foods Inc., reported results for the quarter ended Sept. 30, 2007.  The company posted sales of $1.34 billion, a decrease of 1% compared to the comparable year-ago period. Net earnings were $227 million, compared with a loss of ($23 million) in the year-ago period. (Meating Place)
Brakke Consulting is an excellent resource in the strategic planning process.  We can provide expert assistance in activities such as:
- reviewing the revenue estimates and success probability of the product pipeline;
- reviewing the timing of various new product introductions versus probable timing of competitive introductions, and estimating the impact of various scenarios;
- benchmarking various functions against company competitors in the larger markets.
Brakke Consulting can provide insights and professional assistance that improves the likelihood of success.  Please contact us if you would like the benefit of professional assistance in any of these areas.
> Merial announced it has acquired the New Zealand animal health company Ancare.  The acquisition includes all of Ancare's commercial and manufacturing operations and assets in New Zealand and in offshore markets including Australia.  The research and development arm of Ancare has been split from the commercial operations and will operate as an independently-owned entity called Ancare Scientific.  Ancare Scientific, in collaboration with Merial, will develop products for Merial to market globally. Financial details were not disclosed. (company press release)
> Schering-Plough announced that, following the completion of the acquisition of Organon BioSciences and the integration of the animal health divisions, Ruurd Stolp will become president of the combined animal health unit (Schering-Plough Animal Health and Intervet).  Raul Kohan, currently president of Schering-Plough Animal Health, will continue to serve on the Executive Management Team (EMT) and Operations Management Team (OMT) as senior vice president, Corporate Excellence, reporting to Fred Hassan.  In addition to his core corporate duties, Raul will serve as deputy head of animal health and work with Ruurd on the integration. (company information) 
> The USDA announced contracts with three manufacturers to produce 1.5 million radio frequency identification ear tags that are compliant with National Animal Identification System standards. The manufacturers are Allflex USA; Digital Angel; and Global Animal Management. The combined cost of the contracts is $1.7 million. The ear tags will be used specifically for USDA state-federal cooperative disease control and eradication efforts, and will be distributed in geographic areas which are determined to be of increased risk for disease outbreak or spread. (USDA.gov)
> Petsleeves announced the launch of Petsleeve Rx Disposable Petwear, a lightweight, breathable garment that secures bandages and diapers, contains wound drainage, and deters dogs from biting stitches or irritable areas. It is made of similar material to that used for surgical gowns and can cover a pet's torso without hampering movement.  It is available in nine different sizes for most sizes and breeds of dogs. DVM Resources will distribute the product nationally. (Animal Pharm) 
> UK   Greer announced it has entered into a strategic supply agreement with Axiom Veterinary Laboratories Ltd., one of the largest providers of clinical pathology diagnostic services throughout the United Kingdom and Europe. Under the terms of the agreement, Greer will provide immunotherapy to Axiom Allergyvet, a division of Axiom Veterinary Laboratories. (Business Wire) 
> AVIAN INFLUENZA ECONOMIC IMPACT   The economic impact of highly pathogenic avian influenza on the global poultry market was "short-lived," according to a new report from the USDA's Economic Research Service.  According to the report, while international demand substantially declined in 2003 after a series of outbreaks, reductions rebounded quickly to pre-outbreak levels. Consumer fears negatively affected poultry consumption, which led to lower domestic prices, consumption decreases and lower global exports, even in those countries without outbreaks.  European HPAI outbreaks again affected global demand in 2006, but by the end of that year, world poultry meat output had reached a new high. (Meating Place)
> NETHERLANDS - BLUETONGUE  The whole of  the Netherlands has been declared a bluetongue contaminated area, and more than 5,770 Dutch farms have reported an outbreak.  Most of the cases have been found in the midwestern province of Gelderland, which borders Germany.  (AnimalNet - Xinhua News Agency) 
> US - BOVINE TUBERCULOSIS   The Minnesota Board of Animal Health announced that a heifer from a farm in Beltrami County tested positive for bovine tuberculosis (TB). Minnesota has now detected bovine TB in eight beef herds in Roseau and Beltrami counties. The USDA is coordinating the details of indemnification and depopulation. State and federal officials have already begun tracking the movement of animal into and out of this operation. (Feedstuffs)
This week animal health companies continued to report positive financial results for the latest quarter.  We remain optimistic that the industry will wind up 2007 with solid growth in the 5 - 10% range.
I had the privilege this week to attend the fall Advisory Council Meeting for Texas A&M University's Center for Executive Leadership in Veterinary Medicine.  The school has gathered an impressive group from industry, academia, and professional associations to provide guidance in developing veterinarians and future leaders for the profession.  I commend the University for understanding that it takes much more than just good clinical skills to be a successful veterinarian, and in finding innovative ways to develop those other important qualities in their students.    
Lynn Fondon
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