Vetoquinol - Universal Registration Document - 2021

1 Vetoquinol Universal Registration Document 2020 Financial report 17 PRESENTATION OF THE GROUP Animal health world market pet segment, where its subsidiary has achieved recogni- tion through the registration and launch of a number of Essentials products, but also in the pig market, where China is still the world’s top consumer and producer of pork (source: USDA – United States Department of Agri- culture) despite the swine fever crisis. Through active cooperation with local partners, in 2019 Vetoquinol suc- cessfully launched BoarBetter ® , an unrivaled innovation designed to stimulate reproduction processes in pigs. In 2017, Vetoquinol formed a partnership with Zenoaq, Japan’s leading independent veterinary pharmaceutical company, in order to register and market the Group’s Essentials products in Japan by harnessing our partner’s expertise. 1.5.3 Animal health market outlook The following are expected to be the main trends over the 2021-2023 period: • The health measures related to COVID-19 have had a limited impact on the animal health market, both in pets and in food-producing animals. It is likely that health measures will continue to have little direct impact on the market. However, this crisis will have indirect effects on our market. • An economic crisis: it is still difficult to clearly measure the economic effects of this crisis at the global level, but also by region. From experience, the animal health market is resilient to various economic crises. This resilience can be explained by the strong link between owner and pet, but also by an increase in meat consumption in countries with high population growth and an increasing purchasing power. • An acceleration of digitalization, due in particular to social distancing measures with impacts on the value chain and on the ways and means of access to customers. • The development of both generic drugs, including in the United States, and those resulting from technolo- gical innovation. • The largest contribution to real growth is expected to come from pets and poultry. • The unforeseeable impact of diseases that could tem- porarily affect meat production and consumption in specific regions (swine flu, bluetongue, bird flu, foot- and-mouth disease, etc.), such as the swine fever outbreak in China and South-East Asia. • Efforts to improve food safety and traceability, tighte- ning regulations and a drive to improve animal health, notably in Asia in order to minimize the outbreak of health crises (swine fever, coronavirus). • The promotion of animal welfare, including in the breeding sector. • The development of care for older pets is expected to boost the sale of veterinary drugs for the treatment of chronic illnesses, including cardiovascular and kidney diseases and pain treatments. • The introduction of tighter regulatory constraints, even in less-developed countries, in order to promote animal product exports. • Volumes in the anti-infective market are expected to grow, however below that of market growth over the period, and varying considerably from region to region. For food-producing animals, this trend, which has already been observed in Europe in recent years, will continue and extend across North America. This trend is related to regulatory restrictions aiming to avoid any form of antibiotic resistance in non-curative treatments in favor of the rational use of antibiotics in curative treatments.. • Vaccines and new pet therapies are expected to grow at a higher rate than the market. • The digital transformation of the sector will be stepped up in both pet and food-producing segments and is set to be a source of innovation in solutions and services. • All regions are expected to post growth in the pet market. • On the food-producing market, Latin America and Asia are expected to grow faster than North America or Europe in volume terms.