Animal health industry leader Zoetis--the Pfizer spinoff that sparked a boom in the business last year--reported revenue of $1.2 billion for the second quarter of 2014, an increase of 4% from the same period last year.
Animal health, which for decades was little more than a side business for big pharma companies, has emerged as a beacon of growth and an important profit driver in the industry. The rise of animal health as a growth engine has set off a flurry of dealmaking, attracted an influx of capital and created an increasingly dynamic marketplace for pet and livestock pharmaceuticals.
As more deal talk swirls, the burning question in the pharma world is whether animal health divisions are better off as stand-alone companies, focused exclusively on animal health, than as divisions of human-pharma organizations. It's a sensible question--animal health is fundamentally different from the human pharma business, with unique demands and complexities.
It is fascinating what has happened in the last couple of years in the animal health industry, which runs to $22 billion a year for animal drugs and vaccines and is expected to grow at 5.7% compound annual rate, faster than the market for human medicines. Zoetis was spun off from Pfizer as the largest independent animal health company. M&A action in recent months is remixing the players once again. Next year, Novartis will be off of this list, and based on current revenues, Eli Lilly's Elanco should ascend to the number two position.
Many, but not all, of the largest are units of Big Pharma. One of the things you might notice is the range in size from largest to smallest, $4.56 billion, to $413 million. Given the current M&A atmosphere, there is a good chance that another player could be spun off, or sold, reshuffling the deck once again.
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Mars Petcare has issued a voluntary recall for 22 bags of its Pedigree dog food that may contain small metal fragments and were sold at Dollar General stores in four states.
A pair of public offerings recently announced could be signs the animal health sector is finding an appetite for IPOs.
As part of its global expansion plans, New Zealand animal drug delivery company Simcro is planting the flag for its North American operations in Lawrence, KS.
San Francisco-based Kindred Bioscience did not meet the primary endpoint during a trial of CereKin, its drug for canine osteoarthritis, based off studies for Amgen and Pfizer's Enbrel.
Vetmedica will open a $28.7 million warehouse and packaging facility this week in St. Joseph, MO, where the Boehringer Ingelheim animal health unit is headquartered.
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