NOBULL: Merck Suspends Sales of Cattle Supplement Zilmax in U.S., Canada
August 16, 2013, 10:49 a.m. ET
Merck Suspends Sales of Cattle Supplement Zilmax in U.S., Canada
By Kelsey Gee
Merck & Co. (MRK)’s animal health division said Friday it would temporarily suspend sales of its widely used feed additive Zilmax in the U.S. and Canada.
Zilmax is a growth-promoting drug that is fed to cattle in the final weeks before slaughter, and can add about 2%, or 24 to 33 pounds, to an animal’s weight.
The announcement follows Tyson Foods Inc.’s (TSN) decision last week to suspend purchases of cattle fed Zilmax. Tyson said in a letter to suppliers it would stop buying such cattle effective Sept. 6, because it is concerned Zilmax may have been a factor in some cattle showing up at its slaughter plants unable to walk or to move.
"We remain confident in the safety of the product, based on our own extensive research and that of regulators and academic institutions, and are committed to the well-being of the animals that receive it," KJ Varma, senior vice president of research and development of Merck’s animal health unit, said in a statement Friday.
Earlier this week, Merck’s animal health division unveiled a five-part plan to re-certify every feedlot operator, animal nutritionist and veterinarian that gives Zilmax to cattle, as well as audit the path of Zilmax-fed animals to meatpacking plants.
"In support of our customers and to ensure effective implementation of our Five-Step Plan, Merck Animal Health has made the decision to temporarily suspend sales of Zilmax in the United States and Canada," Merck spokesperson Pam Eisele said. "Our first and foremost priority is the health and well-being of cattle."
Merck estimates about 70% of the U.S. beef industry’s cattle supply is fed with Zilmax or its competitor Optaflexx, a brand of ractopamine made by Eli Lilly & Co. (LLY) Both drugs are part of a class of feed supplement called beta-agonists, which speeds weight gain in animals and make meat leaner.
This is a departure from Merck’s statement earlier this week, when Ms. Eisele said customers who have already been certified may continue purchasing Zilmax throughout the re-certification process, but that the company is "putting greater emphasis to ensure they are using it safely and properly."
Zilmax sales in the United States and Canada were $159 million in 2012.
Shares of Merck fell 0.7% to $47.61 in morning trade Friday. The stock is up 16% this year.
-Ian Berry contributed to this article.
Write to Kelsey Gee at kelsey.gee@wsj.com