ANIMAL NUTRITION

Animal Nutrition

Animal Nutrition

A.L. Labs started its operations in the U.S. by selling animal-feed additives. They have acquired fermentation cultures from its parent company A.L. Oslo located in Norway the company also has global manufacturers in Chicago, Indonesia and Canada. Intensive research led to the introduction of BMD, which was easily approved to be used in the U.S. The antibiotic BMD, has clear advantage over other products in the market and has experienced an increasing trend in its portion in company sales since 1985.

With A.L.'s access to global markets it being a non-problem, the company then focused on diversifying its products and manufactured soluble BMD(Solutracin) and Color guard Vitamin D3. For its US market, the company focused in educating potential users of their product. These were necessary to increase market share in the food additive industry.

Pharmaceuticals

AL Labs has been focusing on distribution of generic pharmaceuticals since it has acquired Dumex Ltd. Based in Denmark. The move was important since the Danish government provides subsidies to Dumex' drug research projects. New drug developments in Dumex research has captured shares in the Swedish and Danish market and is being registered to other European countries and will soon enter the US , where there are opportunities for cross-fertilization of new discoveries in drug manufacturing. Also, the acquisition of ParMed boosts the selling techniques of the company and can be tried out in foreign markets in its quest to extend its generic pharmaceuticals product line. In 1987, the company started diversifying its generic pharmaceuticals by acquiring Barre Labs, which has perfected its liquid pharmaceuticals technology. Although the market is there with increase in the number of people in the geatric and pediatric market, there is a big opportunity in the industry, especially because only 12% of liquid drugs have generic counterparts. Which means, an 88% untapped market, is waiting for Barre and AL Labs to manufacture and distribute these products.

Human Nutrition

The formulation of powdered milk distributed by AL Labs is primarily backed by Dumex Ltd. Because of the established manufacturer, AL can extend its product line to foreign countries especially in the east. This move to go EAST hopes to attract market shares in spite of the intense competition in the area. AL Labs cannot forego their current position since it receives millions of dollar royalties from foreign countries selling the company's patent brand.

Why has AL Labs implemented a strategy of decreasing foreign sales so that US sales can reach 55%?

First is the concern of the appreciating European (Danish Kroner) currencies against the US Dollar. Second is the concern of competing with the parent company and thus possibly the withdrawal of their license. And there is also an increasing segment of the senior citizen and meeting this increase means profit for them without leaving their country thus having less risks.

The strategy provides advantages for the company because, it cuts R&D costs , for Dumex is subsidized by the Danish government in developing new types of generic ...