Zoetis expands product offerings in key China market

Courtesy of Zoetis

China is one of the key markets for animal health industry leader Zoetis ($ZTS), and it is now expanding its presence there with on-farm cattle health screening tests that it has sold for several years in the U.S. and Europe. The tests allow farmers and vets to screen cattle on site for the two major causes of lost production and poor milk quality in China, subclinical mastitis and ketosis.

Zoetis is boasting that the screens provide test results in as little as 5 minutes. They are manufactured by Moorestown, NJ-based PortaCheck.

"In China, the incidence of subclinical mastitis and ketosis is about 10% to 30% with as many as 1.5 million milking cows at risk of these illnesses," said Qing Wang, general manager, Zoetis in China, in a statement. "… I expect the new test kits will fill gaps in current technical protocols and benefit Chinese dairy farmers."

The tests come as part of a greater push for the company's presence in Asia. Zoetis' Acting CFO, Glenn David, said in a first-quarter earnings call in May that in Asia Pacific, Q1 sales were $169 million--an increase of 4% operationally. "Our APAC (Asia Pacific) segment also felt the significant impact from foreign exchange, with the Australian dollar, Japanese yen and Indian rupee all contributing to a negative 7 percentage point impact on revenue," he said, according to a transcript from Seeking Alpha.

David added that sales of livestock products "grew 7% operationally driven primarily by sales of swine products in China and Japan, poultry products in India, and cattle products in China," but the growth was slightly hampered by declining sales of cattle products in Australia, New Zealand and Japan.

The company started work in November on a new manufacturing facility in Suzhou, China. The facility, expected to be online in 2018, will replace the company's current Global Manufacturing & Supply operations in the city and will make products for China and about 60 other countries. The company has said it will be the manufacturing hub for the production of premix and soluble powder products, which includes feed medicines Lincomix, Linco-spectin and Neomix. 

- here's the Zoetis screening test release
- get the transcript of the earnings call
- read the release on the manufacturing facility

Special Report: Top 10 animal health companies of 2013 - Zoetis