You may not know it, but according to Brakke Consulting, a firm serving companies in animal health and nutrition, pet care, and veterinary services, $9.8 billion USD was spent on pharmaceuticals, biologicals and parasiticides in the global companion animal market (dogs, cats, horses) in 2014. What's more, according to said research, the United States is the single largest companion animal market on the planet at an estimated $4.2 billion USD.
Zomedica Pharmaceuticals Corp. (“Zomedica”) (
TSX: V.ZOM,
Forum) has identified a unique approach in both marketing and product pipeline development that will poise this company as an emerging leader in the animal health sector, which has experienced steady year-over-year growth performance. As such, this company has the potential to turn the multi-billion dollar industry on its ear and realize some serious blue sky potential.
It was for this reason that I sat with Zomedica Chairman and CEO Gerald Solensky to get the full picture on the company, its offering and future potential as it prepares to complete a transaction resulting in the listing of its shares on the TSX Venture Exchange later this month.
Q: For the uninitiated, describe Zomedica in a nutshell.
A: Zomedica is a pharmaceutical company targeting health and wellness solutions for the companion pet through a ground-breaking approach that focuses on the needs of the veterinarians themselves. Through a diversified business model comprised of the discovery, development and commercialization of innovative drugs combined with novel drug delivery systems, devices and diagnostics, we are committed to giving veterinarians the opportunity to lower costs, increase productivity, and grow revenue while better serving the animals in their care.
To put it simply, Zomedica’s vision and mission is to advance the health, effectiveness and financial well-being of the companion animal veterinarian by delivering economically and professionally beneficial products and services.
Q: With current market volatility punishing many sectors, how would you describe the companion pet health space and its future prospects?
A: Along with the stats mentioned in your introduction, there are more than 57,000 companion animal veterinarians practicing in the United States, according to 2014 data from the American Veterinary Medical Association. This presents an attractive opportunity for market penetration and expansion beyond prescriptive therapeutics into devices, diagnostics and other needs-based veterinary solutions.
Also, companion animal medicine is on the leading edge of human translational research—research that bridges the gap between basic science and clinical application. Animals and humans share very similar health concerns, like diabetes and cancer for example. And so, advancements in human medicine continue to rely on advancements in animal medicine with medical researchers looking more and more to veterinarians to develop translational models of human disease. We see an opportunity to capitalize on early human R&D discoveries for the underserved animal health industry.
Q: There are many animal health product providers already operating within the companion pet space, what is it that differentiates Zomedica from the competition?
A: There are three distinct areas that really set us apart from our animal health counterparts:
One, our veterinarian-focused mission is dedicated to advancing the health, effectiveness and financial well-being of companion animal vets by delivering economically and professionally beneficial products and services.
Two, our customer-driven approach to product development and innovation is focused on building a portfolio of products based on the pervasive and urgent needs of vets, as opposed to solutions rooted in novel science or human health that may not successfully translate to the animal health space.
And three, our executive management team includes multiple clinical veterinarians that advocate for the veterinary customer to help ensure our product pipeline reflects their needs while also considering market requirements and corporate objectives.
Q: Zomedica will be engaging the FDA Center for Veterinary Medicine (“CVM”) to create a CVM-approved drug pipeline. How will Zomedica identify the drugs to place within its pipeline and how will the CVM-approved approach benefit the company and its investors?
A: By engaging our veterinary customers early through our “voice of the vet” programs, Zomedica seeks to identify therapeutic areas and novel solutions that are of the highest and best value for veterinarians. This needs-based approach to product development, similar to that of a tech company, endeavours to accelerate early adoption of our products. By taking these solutions through the rigorous CVM approval process, our goal is to validate these products as safe and effective for veterinary use and garner FDA exclusivity, securing a long-term protected revenue stream.
It’s also worth noting, while the CVM approval process is complex and demanding, the overall regulatory timetable can be much shorter in contrast to the human medicine equivalent. This means Zomedica has the potential to demonstrate pipeline value to investors and customers much earlier in its lifecycle than a human biopharmaceutical company.
Q: When it comes to revenue streams, Zomedica won’t be a one-trick-pony. Would you explain what other revenue platforms the company will be employing and what makes them unique?
With our forthcoming “voice of the vet” programs, Zomedica aims to strategically focus its product innovation to capitalize on opportunities beyond the pharmaceutical category in a very deliberate manner. In light of that, our device pipeline will be developed through an established network of academic and industry contacts, with the objective being to license or acquire appropriate technologies for introduction into the veterinary medicine space where there is no corresponding regulatory pathway, as required in human medicine. Altogether, this diversified product strategy has the potential to mitigate investment risk.
Q: You mentioned earlier that Zomedica’s vision is to advance the health, effectiveness, and financial well-being of the companion animal veterinarian. Would you explain the reasoning behind this vision, and how it will benefit the company?
A: Our entire team has been touched by the power of the human-animal bond and the vital role veterinarians play in the health and well-being of our pets. With multiple clinical veterinarians on our management team, we understand the joys and sacrifices of clinical practice and the challenges that impact the professional and personal satisfaction of veterinarians.
We are committed to helping veterinarians realize their full potential, to recapture the joy in their career, to “come full circle.” This approach just makes for good business. By focusing on the needs of the veterinarians, we are looking to transform the market’s growth potential from the inside out. This business strategy could present a multitude of economic benefits, but also offers the potential to create a community of brand loyalists and barriers to entry for the competition.
Q: Strong leadership is integral to any company’s success. Who are the key members of Zomedica’s executive team and board of directors, and what skills do they bring to the table that will help drive the company forward?
A: As a start-up, recruiting the right talent was paramount. Our eminently capable team includes leading practitioners of veterinary and human medicine, with a century of combined experience in clinical veterinary practice, biotechnology, operations management, entrepreneurship, corporate governance, performance optimization, drug discovery and development, bench research and technology licensure.
This team continuously challenges the status quo, pushes boundaries, and thinks outrageously with a mission-driven focus on execution. As a result, we’re making the impossible, possible. For example, Zomedica is poised to be one of the fastest veterinary pharmaceutical companies to evolve from formation to public listing on a North American exchange.
Q: What milestones can investors expect Zomedica to hit over the next 12 months?
A: In addition to listing on the TSX Venture Exchange later this month, our 2016 targets include:
Q: What are the biggest challenges facing Zomedica right now in reaching said milestones?
A: With the combined trifecta of a customer-driven business model, development of a diversified portfolio targeting multiple revenue streams, and expert leadership, we are limited only by our imagination.
Q: Why is now a good time for investors to consider Zomedica?
A: As the animal health sector continues to grow and evolve, Zomedica is primed to become a market leader by channeling innovation. With a laser focus on developing its customer-driven business model, diversified product portfolio, and world-renowned team, Zomedica strives be at the forefront of growing, developing and inspiring the future of veterinary medicine.
Zomedica has the distinct potential to become a recognized leader in the animal health sector and as a result, provide a targeted return on investment. It might be wise to put them on your investment radar, but as always, this is just my opinion. Do your own due diligence before making any investment decisions.
--Gaalen Engen
https://twitter.com/gaalenengen
FULL DISCLOSURE: Zomedica Pharmaceuticals Corp. is a Stockhouse Publishing client.