Elanco and Dow deal: firms weigh up feed efficiency and animal health synergies

By Jane Byrne contact

- Last updated on GMT

Dow and Elanco aiming to boost feed conversion efficiency and the health and wellbeing of livestock
Dow and Elanco aiming to boost feed conversion efficiency and the health and wellbeing of livestock
Boosting livestock health and FCR is the reported goal of a new deal between Elanco Animal Health and the Dow Chemical Company’s biotechnology and crop protection arm, Dow AgroSciences.

The agreement, said the two partners, leverages the strengths of Elanco's animal health business with Dow AgroSciences' proprietary germplasm and feed technologies.

The two organizations share the goal of developing ‘total solutions’ to improve animal productivity systems from the carrying capacity of the land, to animal feed conversion efficiency, to the health and wellbeing of production animals to meet the demands of the growing global population.

We are at a very early stage in the research process but we are testing a number of concepts to identify synergies between existing products and technologies from Elanco and Dow AgroSciences that demonstrate improvement in animal productivity in terms of meat and milk production on a per hectare or per animal basis,” ​Kenda Resler Friend, a spokesperson for Dow AgroSciences, told feednavigator.

USDA sanction of Dow GM traits

Last week saw the US Department of Agriculture (USDA) give final approval to new genetically modified (GM) corn and soybean traits developed by Dow AgroSciences that, while heavily criticized by environmentalists and some farmers, are said by the biotechnology company to counter the weed resistance problems that limit crop production.

The USDA clearance for the Enlist weed control system is said to mark a major milestone in Dow AgroSciences' strategic plans for long-term growth.  

Enlist combines soy and corn traits along with herbicides. But US consumer advocates such as the Center for Food Safety are critical of it, saying it has the potential to cause adverse effects on health and the environment.

They warn that planting of Enlist corn will lead to a significant rise in the use of 2,4-D herbicide, triggering health threats.

The USDA authorization means the new traits could be on the market for the 2015 US planting season, says Dow. But the company is still awaiting approval from the US Environmental Protection Agency for the herbicide, which the genetically altered Enlist corn and beans are designed to tolerate.

Elanco on asset trail

The months prior to this tie-up with Dow had seen Elanco, a division of pharma giant Eli Lilly, quite active in its pursuit of animal vaccine and feed ingredient targets.

April this year saw it purchase the animal health unit of Swiss group, Novartis, for $5.4 billion, to add to its cattle vaccine range, give it an entry into the growing aquaculture sector and expand its presence in China and other emerging markets.

The Novartis acquisition was on the back of Elanco’s takeover of German feed additives and vaccines producer, Lohmann Animal Health, two months previously, a buy that bolstered the US group’s poultry vaccine segment.

John Lechleiter, Lilly's president and CEO, said the Novartis deal put Elanco into the top-tier of animal health product manufacturers.

"Significant investments in our animal health business in recent years have enabled Elanco to double its revenue since 2008, leading the industry in growth. Global trends suggest continued sustained demand for animal health products in the years ahead,”​ he added.

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