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Agrimarketing : July August 2008
coins it, the “farm” animal health business, accounts for 40% of the global Novartis Animal Health busi- ness. 2% of this share comes from the Aqua Health business, which is based in Prince Edward Island, Vic- toria, Canada. This business special- izes in developing vaccines for use in cultivated fish. The company’s well-known farm animal products include: • For cattle: respiratory and scour vaccines including Vira Shield, Arsenal and Scour Bos. • Swine: Denagard for swine enteric and respiratory diseases, Pneu- moSTAR Myco for pneumonia, and PneumoSTAR SIV for swine influenza. • Sanitation: Larvadex for fly control in poultry and OxyFly and Neporex 2SG for livestock facilities. To serve the market, Novartis now has 50 in-field sales and techni- cal staff divided into five regions in the U.S. Although the livestock pro- ducer is the eventual buyer of the company’s products, Novartis con- centrates its selling activities with distributors, feed companies, large integrators and veterinarians, who influence the products’ selection. The company also works closely with universities to set up trials and provide additional technical infor- mation. “Our messages and efforts are focused on providing science-based facts,” Boren says. “We stress the cost/benefit ratio our customers will achieve with their use, with the over- all intent on helping their Return on Investment and their general prof- itability. Economics drive the farm animal business and our focus is squarely on what matters most to vet- erinarians and livestock producers.” For marketing support, he says the company advertises in trade magazines directed at veterinarians and integrators as well as general livestock producer-oriented publica- tions. It has also utilized radio, is a regular at trade shows and has a robust Web site. “We also have co-op programs available for our distributors,” he reports. Co-op programs include support for customer meetings, tech- nical training, product promotion events and communication plat- forms specific to the distributor. “Distributors are a key part of our business, providing an efficient system to support the needs of the veterinarian and end users,” Boren says. “We consider distributors our key business partners. “It is hard to measure the direct impact of activities and advertising,” he says. “We never know for sure which activity is the most successful, but they all contribute to touching the customer. “However, I think our ‘Round- table Discussion’ meetings that we hold regularly have to rank right up there,” he continues. “At the meet- ings, we bring together producers, integrators and veterinarians for a one- to two-day session and provide them with the latest information on our technology and the science behind it. These meetings have had a large impact on multiple levels across the business unit.” He also reports the company has become more active in providing the media with news releases. “We have launched a number of products recently, plus have label changes, so we began to become a more active communicator,” he says. “I have been very pleased to see the public- ity we have been receiving through these efforts.” Looking ahead, he sees contin- ued growth in the vaccine and the hygiene markets. “There is increased awareness on the bottom line impact of proactive farm animal health care, so I am very encouraged about the future of our business,” he says. Even though the livestock indus- try is having tough economic times because of the increased cost of its feedstuffs, he remains optimistic about the business. “There will con- tinue to be increasing demand for high quality protein throughout the world. Short term, there may be some ownership changes within the U.S. livestock industry as it consoli- dates, but livestock production will still be there in the future, which is why we remain very optimistic,” he concludes. COMMONALITY Despite the differences in their prod- ucts and markets, both Novartis Animal Health units share several commonalities giving it a strong advantage in the very competitive animal health industry. “It starts with our people,” Boren says. “We have assembled a great team of highly skilled folks who are motivated by the success of their customers and the company.” Kausche adds, “Novartis is a global company with approximately 100,000 employees working in virtu- ally every country in the world. This provides a significant intelligence gathering and sharing network that provides our organization and cus- tomers with valuable insight into our products and future opportunities. “As a company, Novartis invests over $6 billion annually on research and development,” Kausche contin- ues. “The results are a pipeline of new products for the future.” That powerful one-two-three punch should drive Novartis to even greater heights. AM July/August 2008 ¦ AgriMarketing 59 NOVARTIS ANIMAL HEALTH TIMELINE Early 1980s: Ciba-Geigy researchers dis- cover an active ingredient controlling fleas in dogs and cats. 1987: Introduces Interceptor flea control. 1996: Ciba-Geigy merges with Sandoz . Renamed Novartis AG . The only farm animal product was Larvadex, a fly control product for poultry. 2000: Novartis’ crop protection business spun off and was renamed Syngenta. Novartis focuses exclusively on health care. 2002: Novartis acquires Grand Laboratories , Larchwood, IA, and Immtech Biologics, Bucyrus, KS. Both are in the farm animal vaccine busi- nesses. 2005: Novartis acquires marketing rights of Denagard for the swine industry from Boehringer-Ingleheim . 2007: Surpasses $1 billion in annual sales. AM
CAMA 2008 Canada