The Rising Influence of Rising Affluence

[DewDiligence]

ELAN is paying a pretty high earnings multiple for Bayer’s animal-health business, but the deal has the strategic benefit of raising ELAN’s proportion of corporate sales in the “companion animal” (drugs for pets) segment from ~35% to ~50%.

In general, drugs for pets have better growth prospects—and fewer political headwinds—than drugs for livestock.