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Do Corporate Buyouts of Veterinary and Pet Food Brands Drive Up The Cost?

The Federal Trade Commission has taken action against one Private Equity Firm. Who’s next?

The Federal Trade Commission has issued a consent order against JAB Consumer Partners to “prevent the private equity firm from further consolidating control over specialty and emergency veterinary clinics.” The FTC is requiring the private equity firm to “divest clinics in Richmond, VA, Denver, San Francisco, and the Washington, D.C. area.” As well, the FTC is requiring the equity firm to get “prior approval and prior notice” for any future acquisitions of veterinary clinics.

The FTC news release included the statement “to Protect Pet Owners from Private Equity…” – but the news release did not go into details exactly what consumers are being protected from (such as increased prices). The only information they provided was “According to the complaint, this deal is part of a growing trend towards consolidation in the emergency and specialty veterinary services markets across the United States in recent years by large chains, including JAB, which regularly monitors local markets throughout the United States in contemplation of continued growth through potential small and large acquisitions of specialty and emergency clinics.”

But in a similar press release from FTC regarding private equity’s investment in human medicine, the agency did not hold back. From a September 2023 news release from FTC (bold added): “The Federal Trade Commission today sued U.S. Anesthesia Partners, Inc. (USAP), the dominant provider of anesthesia services in Texas, and private equity firm Welsh, Carson, Anderson & Stowe, alleging the two executed a multi-year anticompetitive scheme to consolidate anesthesiology practices in Texas, drive up the price of anesthesia services provided to Texas patients, and boost their own profits.”

The FTC alleges that USAP’s multi-pronged anticompetitive strategy and resulting dominance has cost Texans tens of millions of dollars more each year in anesthesia services than before USAP was created.”

There has been a ‘growing trend’ of private equity AND pet food manufacturers buying up veterinary clinics and private equity buying up pet food brands for years. We assume these purchases – just as in human medical services – have resulted in higher veterinary and pet food prices.

Pet food manufacturer Mars Petcare alone owns all of these veterinary related businesses:

AND…all of these pet food/pet care brands:

Our thanks to FTC for their actions. We hope they continue to look into this problem – in pet food too!

Wishing you and your pet(s) the best,

Susan Thixton
Pet Food Safety Advocate
Author Buyer Beware, Co-Author Dinner PAWsible
TruthaboutPetFood.com
Association for Truth in Pet Food


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9 Comments

9 Comments

  1. Bethany

    November 13, 2023 at 3:27 pm

    Not just higher prices but reduced quality as well, as evidenced by the buyout of Primal Pet Foods by Kinderhook Industries, another private equity firm whose primary interest is in increasing profits.

  2. Sarah

    November 13, 2023 at 3:29 pm

    Good start, FTC. NOW GO AFTER VCA. It isn’t just pet food that is twisted and warped and the marketplace turned ever more predatory. The CORPORATE takeover means these: RESTRICTING veterinary care in some corporate-controlled clinics to those pets whose owners are mandated subscribers to so-called WELLNESS PROGRAMS costing HUNDREDS of dollars every year and delivering very little “care” for those dollars; the cash-cow marketing of over-vaccinating; the ANTITRUST behavior of price fixing things like especially canine and equine dental care; staffing of clinics handled by private equity firms and compensation fixing by those – rather than the clinics directly hiring staff or even veterinarians. LOOK AT HOW PRIVATE EQUITY FIRMS ARE NEGATIVELY IMPACTING HOSPITALS, ERs AND MEDICAL CLINICS and the SAME THING IS HAPPENING WITH VET CLINICS. This is EXTREMELY alarming and anyone who truly loves their pets should make EVERY effort possible to seek out and support INDEPENDENT veterinary clinics!

    • Sharon

      November 13, 2023 at 8:16 pm

      I totally agree with you 100%. The corporations have squeezed out the independent veterinary clinics for their own monetary benefit. The care and service are poor and the costs are exorbitant at these corporate run clinics. There are pet owners that struggle to afford care for their fur babies or just can’t afford to do so at all. The poor animal suffers. I have dealt with a few of these corporate run clinics that do not care about the suffering of the animal. They want to see the money first!! They don’t care that these animals are a part of our family.

  3. Sandy

    November 13, 2023 at 4:03 pm

    I’m thinking the partnership between Banfield and Petsmart makes Petsmart a cog in this wheel too. Pet food prices are becoming ridiculous. I buy smaller brands and try and shop elsewhere. Thanks again Susan for all you do and for sharing this!

  4. Sandy Cummings

    November 13, 2023 at 4:20 pm

    Susan
    Love your articles and insight. I found this one so very interesting since I used to feed a previous dog of ours ACANA who ended up with heart issues. The cardiologist we took him was first a Blue Pearl then he went to CVCA and both tried to switch him to Royal Canine.

    I didn’t realize they were in each others pockets. Thanks for the information.
    Sandy

  5. JT

    November 13, 2023 at 6:08 pm

    The veterinary clinic that I’ve been taking my dog to for the last decade was purchased by VCA five years ago.

    While prices have always crept up, it was at a slow pace and while I appreciate the bout of inflation that we dealt with, the increases in cost once VCA purchased the clinic are far above and beyond anything that can be explained away by “inflation”.

    I take my senior dog to the clinic twice a year for a general blood test and a “once over” by his veterinarian.

    A decade ago, this test cost less than $200 and stayed in this range until VCA purchased the clinic.

    Once VCA took over the cost of the test jumped to the low $300’s and kept climbing.

    January 2023 the test cost $421 and I was stunned but a mere six months later the same test cost $500, yes FIVE HUNDRED DOLLARS for a basic blood test.

    I am now seriously considering taking my dog to a non-corporate clinic despite the fact that I like his vet but this is pure price gouging.

    The corporation is simply trying to discover the consumer breaking point.

    I can tell that the veterinarian is embarrassed by this gouging because for the first time she asked me if I wanted to go through with his usual blood testing. I suppose that she knew when I got to the checkout counter I would be in for a shock.

    It angers me tremendously knowing that countless dogs, cats and companion animals in general will suffer needlessly because folks simply can not and in many cases will not put forth so much money.
    It is gross.

    • Dianne & pets

      November 15, 2023 at 5:48 am

      Sadly, even if vets want to leave and go independent, they may very well find that they will have trouble accessing lab testing and other diagnostic services.

  6. T Allen

    November 13, 2023 at 7:15 pm

    My independent vet sold to a corporation. She told me she didn’t want to but they seemed like the best group of all she talked to. AND they offered her FOUR times the amount of the highest independent vet! I don’t blame her. This is her retirement. She’s still working there 1 day a week and can make her own decisions and charge her own prices. I had both my dog and cat in this month and the lab prices had doubled since they didn’t use the local lab and their other prices were much higher as well. I called around and at least one other vet is now corporately owned. The average person can not afford these prices! I got estimates of from $500 to $1200 to get my cats teeth cleaned. It cost $250 to euthanize my dog. It’s unlikely I’ll ever have another dog or cat. I can’t afford it. 🙁

    • Dianne & pets

      November 15, 2023 at 5:40 am

      My vet clinic was bought out, same reason. Now I may have to leave. They can’t seem to hold onto vets and they are referring away urgent cases. Sometimes there are no vets and the technicians are doing more work. I don’t know if it is even possible to find an independently owned vet anymore. This is in Ontario.

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