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Dechra confirms annual double-digit growth, eyes novel molecules

Sep 04, 2018 - Animal Pharm
By Joseph Harvey

Dechra Pharmaceuticals has sustained its rapid growth of recent years and reported a sales increase of around 13% for fiscal 2018.

ales for the year ended June 30, 2018, came to £407.1 million ($524.9 million). This is the first time the UK company has recorded annual turnover of over $0.5 billion – consolidating its status as a top 10 player in the animal health industry.

The firm's performance in fiscal 2018 was supported by "above market growth" In Europe, continued expansion in the US and the further internationalization of Dechra's business. This progress backs the forecast Dechra made on its financial performance earlier this year. The company broke into the animal health industry top 10 in 2017 following acquisition-fuelled growth.

Annual sales in Europe went up 14% to £258.7m. Dechra benefited from around £18m extra revenues from the acquisition of two Dutch companies specializing in generics.

Excluding acquisitions, Dechra's European sales went up by 6%. The company said it performed well in the majority of its European markets.

In North America, Dechra's sales climbed 12% to £148.4m. The firm is benefiting from an enlarged North American sales team. Dechra now employs 107 sales people in the US.

"With the exception of our Carprofen chews and caplets, where sales and margin were affected by distributors marketing their own brands, growth was delivered across our entire range," Dechra noted.

"Strong performers were Amoxi-Clav, following the launch of the smallest tablet size which completes the range, Vetivex IV critical care fluids and Zycortal suspension, which benefited from increased market share and additional demand in the fourth quarter due to a competitor product being out of stock."

Products for companion animals make up most of Dechra's sales. This unit recorded a 19% improvement in sales to £266.7m. The firm's revenues from its food animal business went up by 3% to £48.7m, while its equine sales grew 26.5% to £34.4m. Additionally, Dechra's annual nutrition sales went up 7% to £29.4m.

Profit for the year was £28.9m. This was up by only 1% year-on-year. The business acquired an annual loss of £18m from the companies it brought into the fold over the last year.

Pipeline and in-licencing delivers

Over the year, Dechra achieved over 60 registrations for existing products in new EU territories.

New product launches in Europe included:

  • Solacyl water soluble powder – an anti-inflammatory for turkeys;

  • Diatrim – an antibiotic for the treatment of a wide range of infections, including cattle mastitis;

  • Avishield IBH120 – the company's second EU-registered poultry vaccine;

  • Avishield ND B1 – the third EU-registered poultry vaccine; and

  • Tiasol – a solution to treat various infections such as swine dysentery and colitis in pigs and for the treatment of chronic respiratory disease in turkeys and chickens.

Dechra has also secured 20 product registrations across Australia, Kazakhstan, Malaysia, New Zealand, Russia, South Korea and Thailand in the last year.

"In North America, we have extended the range of Vetivex critical care fluids and have launched the full range of Amoxi-Clav tablets," Dechra said. "We have also developed in-house Redonyl Ultra, a soft chew dermatological supplement incorporating ultra-micronized PEA – an active supplement – sourced through a licensing agreement with Premune."

In 2013, Premune signed an option agreement with an unnamed animal health company for the exclusive marketing rights to a pet dermatology product. This partner later turned out to be Dechra, with whom Premune extended its relationship earlier this year with a deal in the North American market. Dechra said Redonyl Ultra has also been launched in the EU.

Dechra's other in-licencing deals include Canadian company Kane Biotech and Czech firm Bioveta. The partnership with Kane has yielded Vetradent – a water additive to combat biofilms, which is on sale in the US. The Bioveta deal sees Dechra sell BioEquin, which is the first equine vaccine in its portfolio. The product protects against herpes and is on sale in Germany.

Dechra said it has an agreement in place "to access additional equine vaccines from the Bioveta pipeline for the major EU markets".

Dehcra also has a partnership with Australian pain relief specialist Animal Ethics.

Dechra looks for innovation outside generics

Like several other generic drug specialists, Dechra is aiming to boost its product portfolio with pioneer drugs and vaccines.

The firm said: "Licensing deals have been signed or are in negotiation to strengthen our pipeline of novel, innovative products. Our recent acquisitions have extended the range of products in development extensively. However, this is predominantly in the generic or generic plus arena.

"We have been proactively working on signing licensing agreements to obtain early-stage technology to develop novel products and have been successful in gaining access to two molecules, which are currently undergoing proof-of-concept studies and an additional molecule that is in full development."

Reprinted with permission of Animal Pharm News




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