Schering-Plough
I know what you're thinking: "Who cares about this little side business of pharmaceutical companies?" While I'd agree that animal health is definitely a side business, it's far from small. Just check out the numbers from the most recent quarter.
Animal Health Sales in Quarter Ending June '08 |
Growth (YOY) |
|
---|---|---|
Schering-Plough |
$818 million |
210% |
Pfizer |
$715 million |
13% |
Eli Lilly |
$255 million |
19% |
Wyeth |
$313 million |
12% |
Source: Company press releases.
Even generic-drug maker Teva Pharmaceutical
The main lure of OBS for Schering was probably to boost its pharmaceutical pipeline -- with mixed results so far -- and get exposure to women's health and central nervous system medicine. However, OBS' animal health business did boost last quarter's revenue numbers by $526 million; organic growth was 11%. Selling off a few products -- Schering also had to sell a few to France-based Virbac -- shouldn't do too much damage to that growth going forward.
But even if it can manage double-digit growth of the newly acquired products, I'm not sure it will be enough to turn around the company. Animal health sales made up just 17% of sales last quarter. In order to make up for Merck's
More Foolishness on turnaround possibilities: