Pets on Argenta’s Europe agenda
Argenta director Doug Cleverly has found himself on the cutting edge of pet health, writes Julie Iles.
ANew Zealand animal pharmaceutical company Argenta has purchased a third factory in Scotland. Argenta has created formulas for pain medication, anti-parasitics, and topical medication for pets and livestock.
After marketing most of their products to the United States, Argenta opened their first overseas factory in Iowa in 2016.
Argenta managing director and co-founder Doug Cleverly, said there was a large degree of flexibility that comes with owning three factories.
‘‘We no longer make products where it’s necessary to make products, we make products where it’s best to make them.’’
The three factories would reduce cost, optimise the supply chain, and give the company a better understanding of the regional markets..
He said once his team understands more about where products sell, they can make calls more intelligently where to produce what they develop in New Zealand.
The research and development team has been based in south Auckland since 2006. Cleverly said it’s likely to stay that way.
‘‘We have more than 50 scientists located here with the right expertise, the right training, and they’re familiar with the clients, and the clients are familiar with them.’’
Argenta recently created a new drug that is given to animals to relieve pain after surgery. Cleverly said this involves starting ‘‘from scratch’’ on a molecular-level.
‘‘We had to create a chemistry that didn’t used to exist,’’ said Cleverly.
The annual sales of Argenta were about $100 million, Cleverly said.
Driven by the demands of the European and United States market, the research and development team has focused 75 per cent of development on pet products.
The American Pets Products Association found pet-owners spent US$62.75 billion ($87.35b NZ), US $15.92b of which were on vet care. Research from Pets at Home, the UK’s leading small-dog vet found the pet industry was worth £6.1b ($9b NZ).
‘‘New Zealand benefits hugely when you make quite significant international plays like this one.’’
During the financial crisis in 2008, Cleverly found the pet market to be recession-proof.
‘‘People spend a lot of money on their pets even in circumstances of economic turmoil... during the financial crisis, people really spent money on pets, probably more so than on themselves.’’
A pet-owner himself, Cleverly understood the cost that came with taking care of his ‘‘one doofus dog and one cool dog’’.
Globally, pets make up about 40 per cent of the animal health market, while in New Zealand the emphasis is on larger animals. Pets became a root component of the total market in the 1990s said Cleverly.
Cleverly said the European market had a larger emphasis on pet medication, lower regulatory costs, and higher profit margins than New Zealand, something he has also found in the United States market.
Argenta bought the factory in Dundee from American company Elanco Animal Health.
The two companies have a close relationship - both own factories in Fort Dodge, Iowa.
Argenta has taken on Elanco’s sales and supply contract with European buyers and their 114 employees.
Elanco has over 6,500 employees worldwide, and sells to over 70 countries.
Cleverly said having a relationship with Elanco’s buyers will give the company a foothold in Europe.
‘‘If you look at the world and look at where our plants are... there is no place further to have a manufacturing plant than New Zealand.’’
Though the high level of uncertainty following Brexit has given Cleverly a new appreciation for New Zealand’s location.
‘‘For the first time I love its remoteness and see it as a blessing.’’