The private equity giant assured investors that the highly effective, low-cost preventative will soon be pulled from shelves and relaunched as a $340-per-dose premium biologic.
NEW YORK — Following reports that ranchers were successfully using a $4 topical treatment to beat back a resurgence of the flesh-eating screwworm, private equity firm KKR & Co. announced Tuesday it had acquired the drug's manufacturer to ensure the catastrophic agricultural threat is priced according to its true market value.
The parasitic fly, which has begun threatening U.S. livestock after being eradicated six decades ago, lays eggs in open wounds where its larvae consume the host's living tissue. Wall Street analysts had initially warned clients that the widely available $4 solution threatened to neutralize the outbreak entirely before the financial sector could establish a recurring revenue stream from the crisis.
When you look at the sheer devastation this parasite can inflict on a regional cattle market, allowing ranchers to solve the problem for the price of a fast-food side order is a complete dereliction of fiduciary duty.
Hollister noted on an early morning earnings call that the treatment will be temporarily pulled from veterinary distribution channels while the firm executes a "value alignment strategy." The preventative will be lightly reformulated with a proprietary binding agent and relaunched next fiscal quarter under a tiered, enterprise-level subscription model.
Industry lobbying group the Animal Health Institute praised the acquisition in a morning research note, confirming that allowing a sustained, low-cost cure to a flesh-eating plague to remain on the market would have sent a chilling message to shareholders across the veterinary sector.