More Cutbacks Announced For PMU Industry

“Although the rate of reduction has slowed, the size of the market is much smaller.”

– WYETH STATEMENT

Seven more pregnant mare urine (PMU) contracts have been cancelled, leaving the number of ranches in Manitoba, Saskatchewan and North Dakota at 64, down from over 400 prior to 2003.

A statement issued by Wyeth, which markets the Premarin drug for treating the symptoms of menopause, said that a review of its requirements for 2009-10 found that less product would be required, and that its network of PMU ranches would be reduced from 71 last year to 64 through voluntary and mandatory contract discontinuations.

Wyeth added that since the 2002 release of the Women’s Health Initiative (WHI) study, which reportedly found a link to adverse health effects from taking the drug, there has been a continuing reduction in consumer demand for hormone therapy products.

“Although the rate of reduction has slowed, the size of the market is much smaller,” it stated.

The company has also introduced lower doses of its menopause drug, which require less of the estrogen extracted from horse urine.

Ranchers remaining in the network will continue to collect PMU at their current contracted levels, and those whose contracts have ended will be compensated for the care of their mares and foals as they transition out.

After the first big round of cuts in 2003, Wyeth spent US$9.3 million to assist former contractors with trucking costs and efforts to sell their horses, and homes were found for over 26,000. The Equine Placement Fund will continue through to 2010, the statement added.

Greg Little, owner of Little Valley Quarter Horses near Decker, operates a 70-head PMU operation and is the current president of the North American Equine Ranching Information Council (NAERIC), an organization funded by producer checkoff dollars. He said that the latest round of cuts came as a surprise.

After the first round of cuts in 2003, when the number of contracts was slashed from over 400, many thought the industry would stabilize at a smaller volume, or even begin to grow again.

But at a recent meeting, Little said, producers were told that sales of Premarin had fallen and more contracts would be cancelled.

The split in lost contracts between the two Canadian provinces and North Dakota is still unknown, he said, adding that in the past, operators with good-quality horses and ready non-meat markets for their foals were for the most part spared.

“A good breeding and marketing program is a big asset to your business,” he said, adding that most of his mares are broke to ride and have a good show record.

Norm Luba, executive director of NAERIC, said about 500 quar ter-horse and draft breed types out of the total of roughly 5,500 remaining in the industry may have to be sold. At its peak, the PMU industry accounted for about 35,000 brood mares.

U. S. SURPLUS

A political campaign to end horse slaughter in the U. S. has led to a surplus of horses in that country, and no alternative markets for them. Amid a severe economic downturn south of the border, there are reports of horses being abandoned by their owners on public land because they are unable to afford to keep them.

For that reason, many will likely stay in Canada, said Luba, who added that good horses are always going to have a market.

“With over 10 million horses between the U. S. and Canada, there’s a pretty big market to absorb 30,000. It sounds like a big number, but the fact of the matter is that’s a pretty small percentage of the total overall market.”

Wyeth is in the process of being bought out by drug giant Pfizer in a US$68 billion cash and stock deal that is reportedly set to be completed in late October.

A source at Wyeth said that in the meantime, the two companies are operating as separate entities, and Wyeth remains committed to providing the Premarin drug as part of its product line. [email protected]

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