US investing in animal health R&D

11-12-2009 | |

Despite economic conditions, Animal Health Institute (AHI) member companies spent $671 mln in 2008 to research and develop potential new products and to maintain the longevity of existing products.

This is about 5% lower than the 2007 level. This was reported in AHI’s latest R&D Survey.

“From avian flu to H1N1, issues surrounding animals and public health have received increased attention over the last few years,” says AHI president and CEO Alexander S. Mathews. “Investments in R&D are needed to meet the challenges in animal health and, by extension, to protect public health.”

A separate news release outlining AHI’s Market Sales Report reports that spending on products used to treat and prevent disease in companion and farm animals declined slightly in 2008, not adjusted for inflation, totaling more than $6.7 bln.

The 3 product categories for animal health products are biologics, which increased 2%, pharmaceuticals, with a sales decline of 1% and feed additives with a 12% decline in 2008.

“Sales of animal health products were certainly affected by the economic downturn in the fourth quarter of last year,” Mathews comments. “However, companies continued to bring new and innovative products to the market.”

R&D investments
The decline in R&D spending, the first observed in more than 10 years of collecting data, is the result of company consolidation within the industry, Mathews says. The largest percentage declines were in the diagnostics and feed additive categories.

AHI members were asked to report innovative research, or investments directed toward the development of new animal health products; and maintenance research, or revenue spent in support of existing products. As in 2007, the 2008 innovative research figures held steady at 85% of total R&D spending. The remaining 15% went toward research to ensure the longevity of existing products.

Data were collected and compiled by the AHI. R&D spending is calculated according to the type of product manufactured by AHI’s member firms: pharmaceuticals, biologics, insecticides and diagnostics.

A compilation of surveys from the past three years showing trends in animal health products sales and R&D expenditures is available from AHI. The report includes combined sales figures of AHI members for ruminant, swine, poultry, small animals and equine products. Both releases and information on obtaining the full reports are available on Animal Health Institute.