IDEXX Laboratories

IDEXX Laboratories is the global market leader in diagnostics and information systems for companion animal veterinarians. The company is also the dominant global provider of diagnostic tests that monitor water quality. It has successfully adapted medical technologies and information systems for veterinary use since its founding in 1983. It is the only company that offers vets a fully integrated suite of laboratory, imaging and practice management systems that expedite use of new technologies and improve their practice of medicine while increasing the efficiency and profitability of their practices.

Pet ownership continues to grow. In 2007, at least one-third of U.S. households owned a dog or a cat, resulting in 72 million dogs and 81 million cats in need of health care. As pets become members of the family, pet-owners invest more to extend their lives and to keep their geriatric pets healthy. Diagnostic tests and x-rays allow the vet to make quick, accurate diagnoses and are the fastest growing and most profitable aspects of the practice.

The Companion Animal Group sells diagnostics and information systems to vets that care for cats, dogs and horses. It accounts for 80% of the company’s annual revenues. Its main business is diagnostics – in-clinic instruments, their associated reagents, rapid-assay tests and reference lab services. Vets purchase IDEXX Lab’s in-clinic diagnostic instruments and tests to provide quick assessments of a pet’s physical condition. Almost all 25,000 vet clinics in the U.S. own a chemistry analyzer with 68% owning one made by IDEXX Labs’. The company has placed 30,000 chemistry analyzers worldwide. Vets purchase standard sets of tests for routine blood analyses or pre-anesthesia testing or create customized tests by combining individual assays.

The company launched Catalyst Dx its new chemistry analyzer in the first quarter of 2008 and expects to place 2,750 instruments with current customers by the end of 2009. The Catalyst Dx automates sample preparation and can perform tests for two to four animals simultaneously. It runs four pre-anesthesia screens in 18 minutes, half the time of the company’s older instrument. IDEXX Labs’ rapid-assay SNAP® tests monitor infectious diseases in dogs and cats. The popular SNAP® 4Dx® assay for dogs tests for heartworm, Lyme disease and two other tick-borne diseases. Consumable reagents and rapid-assay tests account for 60% of the Companion Animal Group’s revenue.

IDEXX Labs operates 40 reference laboratories around the world that perform diagnostic tests on samples delivered by courier or overnight mail. Reference labs perform more complex tests and tests for conditions that are not performed routinely in a vet clinic. The company develops new tests in these labs and then modifies them for use in clinics should they be performed in sufficient volume. The rapid-assay test for canine pancreatitis, a life-threatening inflammation of the pancreas, was first developed for the reference lab and then released as a rapid-assay SNAP® test in July 2007.

The company’s information systems capture test results from their suite of diagnostic and digital radiography systems and integrate them into an electronic medical record. The vet requests a series of diagnostic tests through the Cornerstone® practice management software. This order is automatically sent to the VetLab station which runs the individual instruments, collects, stores the test results and posts a single patient report in the medical record. Sales of IDEXX Lab’s digital radiography systems grew 15% in 2008 because vets understand the convenience of taking and then re-taking digital x-rays of a squirming pet. Integrating the imaging software with the practice management system allows vets to maintain one information system to store all patient data.

IDEXX Labs also manufactures and sells tests for microbial contamination of drinking water. Government laboratories, water utilities and private certified laboratories test drinking water for compliance with regulatory standards. Sales grew 12% in 2008 to $74 million and accounted for 18% of the company’s operating profit. IDEXX expects this business to continue to grow 5% to 7% per year as they gain regulatory approval for these tests in more countries.



5-year revenue compound annual growth rate: 17%
5-year earnings per share compound annual growth rate: 17%

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February 11, 2015 VISA January 12, 2009 Mettler-Toledo International