Our MD Donal Duggan sat recently with Joseph Harvey of S&P Global Animal Health for a chat on strategy, successes, challenges which was published in the global Animal Health Weekly Briefing recently.
Irish business Duggan Veterinary Supplies believes it has a uniquely-developed structure that sets it apart from other firms in the animal health industry. S&P Global’s head of animal health Joseph Harvey spoke to managing director Donal Duggan about the distributor’s plans for the future.
Donal Duggan told S&P Global Animal Health: “There are many aspects that makes our business unusual and differentiated from other companies in the veterinary pharma space. We have our own personality and I think it’s one clients really appreciate. Our model is very distinctive.”
While Duggan Veterinary Supplies (DVS) is a distributor at heart, the company has interests in many different aspects of the animal health industry. Founded in 1987, the 100% family-owned firm not only supplies products across Europe but also develops its own self-branded products and claims to be one of the only animal health businesses to incorporate postgraduate veterinary education at its headquarters. Recently, another milestone was reached in the company’s development, when DVS applied and was accepted to Access Vetmed – the representative industry body for group of the European generic medicine industry.
Mr Duggan said the Tipperary-based wholesaler has grown exponentially in the last five years by breaking into new geographical regions and adding new product ranges to the categories within its portfolio. The firm’s annual turnover is around €20 million ($22 million). Mr Duggan noted the business is currently executing a five-year growth plan to reach a 20% improvement in sales on a yearly basis and is performing strongly. He suggested the company is excellently positioned to achieve this goal with unparalleled potential and a clear path to success. The five-year plan commenced this year.
Mr Duggan said: “We’re an attractive partner to both commercial and corporate veterinary groups in Ireland, the UK and all over Europe because of our exclusive relationships with about 80% of generic pharmaceutical manufacturers throughout Europe. Typically, the manufacturers or suppliers we tend not to have a formal commercial relationship with are the those that already have a sales and marketing presence on the ground.”
The fastest growing area within the company’s portfolio over the last five years has been its pharmaceutical and agri-tech division. Mr Duggan said this was due to increased demand for innovative veterinary products, expansion into new markets, strategic partnerships with manufacturers and a focus on R&D to address unmet needs. He noted DVS has seen dramatic growth in the areas of equine and companion animals “with slow and steady growth witnessed across the bovine and intensive livestock range”.
Mr Duggan explained: “Following on from obtaining rapid growth in these category areas, we have now resourced additional support to help to manage the introduction of both our pharma and non-pharma products in these areas across the UK and Ireland.”
DVS has conducted external market research to identify growth opportunities in the UK and Irish markets. This revealed increasing demand for “certain types of veterinary drugs, some new emerging trends in animal health and several gaps in the market the company could capitalize on such as the introduction of appropriate and pragmatic technology”.
The firm has also carried out an evaluation of its existing product portfolio, whereby it assessed the performance of current veterinary drugs and identifying areas for improvement or expansion. Mr Duggan said this evaluation highlighted opportunities to develop new formulations, target specific animal species or enter new therapeutic areas. This will aid the company’s five-year growth aspirations.
Mr Duggan expressed DVS consistently seeks out new partners for its distribution wing, which holds approximately
€6m worth of inventory across all markets it serves, encompassing pharmaceuticals, vaccines, feed additives, digital technology and more. This serves around 1,200 clients in Ireland and 5,000 in the UK at any given time.
Mr Duggan explained: “We cater for all number of differing product categories and market segments. This is a legacy arising from the development of the business in Ireland where you were required to stock all relevant items for a market historically dominated by mixed veterinary practices. Today, it has meant DVS is positioned very robustly in the face of any challenge or exposure from any market downturns, commercial exclusion or manufacturing regulations.”
While DVS is not dealing in areas of blockbuster innovation, the firm is key to the day-to-day functioning of the animal health market.
Mr Duggan noted: “The reality is we exclusively supply large quantities of critical and important veterinary medicines into the UK and Ireland every day. We also specialize in suppling products on special import, where the originator or pioneer product may not be available or out of stock – actions that make a big difference on a regular basis to veterinary life. If we weren’t involved in offering this particular service, I’m not certain if anyone else would take on the task or perceive a genuine commercial benefit for their business.”
He said it is likely the company’s product levels “will increase over time, as we continue to expand our market presence and serve a growing customer base”.
He added: “As DVS continues to grow across both markets and demand for our veterinary pharmaceutical products rises, we’ll need to increase our inventory levels to ensure we can continue to meet customer needs and maintain high service levels. Fundamentally, increasing product levels is essential for ensuring continuity of supply, meeting customer demand and supporting our company’s growth trajectory, but we do have a very active stock management team who work closely with the sales teams in both markets to accelerate the inventory turnover period.”
To support the rising level of product inventory, DVS will continue to invest in its procurement processes, supplier relationships and supply chain logistics. The company also aims to improve its warehouse space, storage systems and distribution infrastructure to accommodate a larger inventory level and manage logistics efficiently. Additionally, DVS is investing in inventory management systems, forecasting tools and technology to optimize inventory levels, minimize stockouts and improve supply chain visibility.
Mr Duggan observed: “We anticipate our stock levels will grow in tandem with the increase in turnover we expect to achieve as our business expands over the coming five years. As our sales volume increases and revenues grow, we will need to invest in expanding our inventory to support higher sales volumes and meet the needs of our expanding customer base. However, by aligning stock growth with turnover increase, we can ensure our inventory levels remain optimized – balancing the need to meet customer demand to minimize excess inventory and associated costs.”
DVS works closely with contract manufacturing organizations (CMOs) in the EU to secure generics to fill any supply gaps that might be occurring around Europe. Mr Duggan said DVS is “on the speed dial of all the veterinary decision markers in Ireland and the UK” who might be looking to gain access to products that have gone out of stock but are critical to the day-to-day running of their businesses.
The firm’s ability to problem solve by accessing products from anywhere around the world has been particularly beneficial to DVS at a time the UK has been suffering from supply disruption in recent years.
Mr Duggan remarked: “We’re aware the UK is facing numerous difficulties and hurdles that are continuing to occur. It’s particularly unfortunate timing as new regulations regarding good manufacturing practices, GDP and various other regulatory changes are being implemented at an EU level, leading to supply challenges directly linked to Brexit. It’s truly a perfect storm.”
DVS began producing non-pharma products in conjunction with CMO partners and with support from the Irish government around eight years ago. This led to the company’s first pharmaceutical dossier development in 2022, when it successfully licensed a canine antiparasitic tablet indicated against several commonly found parasites in the UK and Ireland. Mr Duggan said the firm currently has four ongoing pharmaceuticals in development, which it hopes to register in the next 36 months.
Another string to DVS’ bow is its ability to support veterinary education at its headquarters. The company has built a conference suite and Clinical Skills Lab, which are used for onsite continued professional development courses. The Clinical Skills Lab is a teaching space used to deliver dry and wet lab courses to vets and nurses. With over 800 attendees attending certificate, diploma or degree courses throughout 2023, Mr Duggan said the appetite for upskilling and further education amongst the veterinary community continues unabated.
He noted this facility allows course participants to use the most up to date range of electronic equipment, instruments and consumables to learn new skills and techniques guided by experienced and highly qualified tutors. The establishment of a Clinical Practical Skills Lab offers several benefits that contribute to the overall success of the business and complements the supply of veterinary products into the Irish and UK markets.
Mr Duggan said: “The Clinical Practical Skills Lab provides a dedicated space for the provision of training and education to veterinarians and veterinary professionals. Within the skills laboratory environment, they are then allowed an opportunity to upskill on the proper administration, handling and use of the company’s products. By offering hands-on training sessions and workshops, DVS can ensure customers have the necessary knowledge and skills to effectively use its products, leading to better outcomes for animals and improved customer satisfaction. Hosting education and training sessions, workshops and events at the Skills Lab provides opportunities for DVS to engage with customers directly, fostering relationships and loyalty.
“By offering valuable educational resources and networking opportunities, DVS can strengthen its relationships with customers, identify their needs and preferences, and tailor its products and services accordingly. Having a dedicated Clinical Practical Skills Lab sets DVS apart from competitors and positions it as a leader in veterinary education and training. By investing in facilities and resources to support customer education and skill development, DVS demonstrates its commitment to supporting veterinarians and advancing animal health, which can enhance its brand reputation and market competitiveness.”
