For years animal health was a mere afterthought to pharmaceutical companies. Now with slowing growth in the human health field, and the proliferation of generic drugs, these companies are looking to animal health to diversify. The sector’s predictable cash flow, high margins and brand loyalty have made animal health a much more stable business than human pharmaceuticals.
Merck and Pfizer’s animal health businesses have grown to $4.27 billion and $400 million in annual sales respectively. With both companies looking to sell part of their assets, several pharmaceutical companies are vying to own a piece of this rapidly expanding market.
According to U.K.-based research company, Vetnosis Ltd., animal drug sales grew 7.2 percent last year compared to 1.3 percent for human medicine. The sector has grown steadily despite economic cutbacks in veterinary care.
While much of the industry’s business stems from caring for the food we eat, our society’s changing view of pets is certainly making a large contribution. Merial’s Frontline flea and tick products alone account for about half of its $2.5 billion in sales.
With the recent development of ground breaking drugs like canine cancer treatment, Palladia, it’s clear that the pharmaceutical industry is finally taking pets seriously. While I’m a little worried about the potential cost of these new drugs (just look at our current health care debacle!), I’m always happy to see advances in the veterinary field that will improve the lives of our beloved pets.