February 10, 2010
Bayer opens flea product sales to retail outlets
Citing diversion, company ends policy of selling only through veterinarians
By: Edie Lau
For The VIN News Service
Bayer Animal Health announced Tuesday an end to its decades-old policy of selling Advantage and K-9 Advantix flea and tick prevention products exclusively through veterinarians.
Citing ongoing consumer demand for more convenient access, the company said it will sell its parasiticides directly to pet specialty retailers and pet specialty Internet sites beginning in March.
The products already have been carried for some time by outlets such as Petco and the online pharmacy Pet Med Express, which apparently obtain the merchandise through clandestine “gray market” channels. The practice is not illegal — the law does not require pet parasiticides to be sold to consumers only by veterinarians — but has been a violation of the major companion-animal-health companies’ sales policies and a sore point in the veterinary community.
The situation upsets some practitioners who say they are able to offer lower medical-service fees thanks to income from sales of parasiticides and other products. Some clinicians also feel they’ve been exploited by companies to build brand loyalty among pet owners.
Expressing a resentment shared by others, Dr. Carl Darby, a practitioner in Seneca Falls, N.Y., wrote in an online discussion of the Veterinary Information Network (VIN): “I guess they have decided that they do not need their free sales force any more. Someone at Bayer must have decided that they can make more money and sell more product through retailers.”
Darby added in an interview by e-mail with the VIN News Service, “I hope that Bayer understands that losing their highly educated, motivated and dedicated free sales force may have long-term impacts on their business, and it may be difficult for them to regain the trust of the profession.”
At the same time, Darby and others lauded Bayer for addressing the problem of product diversion to the gray market head-on.
“At least they are not lying to our faces,” he wrote on VIN, referring to a suspicion in the veterinary community that pharmaceutical companies have been complicit in making flea and tick products available outside of veterinary clinics, either by selling products to retailers without admitting it, or by not aggressively hunting down leaks in the wholesale pipeline.
Officials at pharmaceutical companies such as Merial, maker of the top-selling parasiticide product Frontline, have said that the main source of diverted product is veterinarians themselves.
Given the contentious history of the issue, Bayer’s new sales policy elicited a flurry of opinions even before the change was announced publicly. Many comments posted on VIN were angry. Some practitioners said they would immediately stop carrying Bayer products. Others brainstormed on how they could register collective displeasure with the company’s new stance. But the sentiment was not universal.
Dr. Jami Stromberg of Brooklyn Park, Minn., for example, wrote: “Pesticides are a nice source of income, but I will not live or die on those sales. To protest ... (against) a drug company for acting in their own interest in a completely legal way seems to be a little over the top. I will continue to dispense and recommend the products that I feel are the most useful, and the drug companies will continue to distribute to the stores/clinics/pharmacies that will sell their products. And the sun will rise tomorrow morning like it always does.”
Dr. Albert Ahn, a pharmaceutical company executive who spent about 10 years working on flea and tick prevention products at Merial and Summit VetPharm, said Bayer deserves credit for directly addressing the growing problem of product diversion and veterinarians’ discontent over the issue.
“Bayer’s move was definitely a bold one,” said Ahn, who is currently president of AB Science in New Jersey. “I do think they’re taking a position of leadership. ... It’s my opinion that this will put quite a bit of pressure on other companies to adopt a position and to articulate their sales policy going forward.”
Spokesmen at Novartis, Pfizer and Summit VetPharm told the VIN News Service that their policies of selling product exclusively through veterinarians would remain unchanged.
Merial, maker of Frontline, which appears to be the most-diverted flea and tick prevention product in the country, said it would release a statement on the subject "soon," but had not done so as of 2 p.m. EST today.
In early 2009, the makers of pet parasiticides affirmed their commitments to their veterinary-only sales policy in interviews with the VIN News Service. Bayer spokesman Bob Walker said last March: “We believe in our sales policy and continue to abide by it for its support of the veterinary profession and the value that veterinarians bring to pets and pet owners.”
In Tuesday’s announcement, apparently anticipating some negative reaction, Joerg Ohle, president and general manager of Bayer Animal Health, said: “We cannot stress enough how committed we remain to veterinarians and we intend to build on our long-standing partnerships with new investments in programs and promotions to support their practices, the profession and the industry.”
Toward that end, Bayer said it will launch a multimillion dollar advertising campaign to spotlight the importance of veterinary visits. The ads will appear in print magazines targeted to pet owners and be distributed at the checkout stands of pet specialty stores.
Bayer also said it would introduce a “March Back In” rebate program in which pet owners who buy an Advantage product from licensed veterinarians during the month of March will receive a $20 rebate if they return to the same clinic for their pet's medical care by Dec. 31.
Bayer added that it plans to increase its financial support of the industry through “key associations” including the American Veterinary Medical Association and the Association of American Veterinary Medical Colleges. It did not give details on what form the support would take.
Answers to other questions about the policy change — including which retail outlets specifically Bayer will sell to, whether it will attempt to control discount pricing, and whether the sales policy change will apply outside of the United States — were not immediately provided by the company.
VIN News Service commentaries are opinion pieces presenting insights, personal experiences and/or perspectives on topical issues by members of the veterinary community. To submit a commentary for consideration, email email@example.com.
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