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Revenue
12 Months Ended
Dec. 31, 2022
Revenue Recognition and Deferred Revenue [Abstract]  
Revenue
A. Revenue from Product Sales
We offer a diversified portfolio of products which allows us to capitalize on local and regional customer needs. Generally, our products are promoted to veterinarians and livestock producers by our sales organization which includes sales representatives and technical and veterinary operations specialists, and then sold directly by us or through distributors, retailers or e-commerce outlets. The depth of our product portfolio enables us to address the varying needs of customers in different species and geographies. Many of our top-selling product lines are distributed across both of our operating segments, leveraging our R&D operations and manufacturing and supply chain network.
Over the course of our history, we have focused on developing a diverse portfolio of animal health products, including medicines, vaccines and diagnostics, complemented by biodevices, genetic tests and a range of services. We refer to all different brands of a particular product, or its dosage forms for all species, as a product line. We have approximately 300 comprehensive product lines, including products for both companion animals and livestock within each of our major product categories.
Our major product categories are:
parasiticides: products that prevent or eliminate external and internal parasites such as fleas, ticks and worms;
vaccines: biological preparations that help prevent diseases of the respiratory, gastrointestinal and reproductive tracts or induce a specific immune response;
dermatology products: products that relieve itch associated with allergic conditions and atopic dermatitis;
anti-infectives: products that prevent, kill or slow the growth of bacteria, fungi or protozoa;
other pharmaceutical products: pain and sedation, antiemetic, reproductive, and oncology products;
medicated feed additives: products added to animal feed that provide medicines to livestock; and
animal health diagnostics: testing and analysis of blood, urine and other animal samples and related products and services, including point-of-care diagnostic products, instruments and reagents, rapid immunoassay tests, reference laboratory kits and services and blood glucose monitors.
Our remaining revenue is derived from other non-pharmaceutical product categories, such as nutritionals, as well as products and services in biodevices, genetic tests and precision animal health.
Our companion animal products help extend and improve the quality of life for pets; increase convenience and compliance for pet owners; and help veterinarians improve the quality of their care and the efficiency of their businesses. Growth in the companion animal medicines, vaccines and diagnostics sector is driven by economic development, related increases in disposable income and increases in pet ownership and spending on pet care. Companion animals are also living longer, deepening the human-animal bond, receiving increased medical treatment and benefiting from advances in animal health medicine, vaccines and diagnostics.
Our livestock products primarily help prevent or treat diseases and conditions to allow veterinarians and producers to care for their animals and to enable the cost-effective production of safe, high-quality animal protein. Human population growth and increasing standards of living are important long-term growth drivers for our livestock products in three major ways. First, population growth and increasing standards of living drive demand for improved nutrition, particularly through increased consumption of animal protein. Second, population growth leads to greater natural resource constraints driving a need for enhanced productivity. Finally, as standards of living improve and the global chain faces increased scrutiny, there is more focus on food quality, safety, and reliability of supply.
The following tables present our revenue disaggregated by geographic area, species, and major product category:
Revenue by geographic area
Year Ended December 31,
(MILLIONS OF DOLLARS)202220212020
United States$4,313 $4,042 $3,557 
Australia289 259 207 
Brazil330 312 258 
Canada238 232 210 
Chile141 136 100 
China382 357 266 
France126 132 118 
Germany176 183 159 
Italy111 115 90 
Japan173 186 177 
Mexico136 133 116 
Spain118 128 112 
United Kingdom235 234 178 
Other developed markets468 467 388 
Other emerging markets758 778 656 
7,994 7,694 6,592 
Contract manufacturing & human health86 82 83 
Total Revenue$8,080 $7,776 $6,675 
Revenue exceeded $100 million in twelve countries outside the U.S. in 2022 and 2021 and eleven countries outside the U.S. in 2020. The U.S. was the only country to contribute more than 10% of total revenue in each year.
Revenue by major species
Year Ended December 31,
(MILLIONS OF DOLLARS)202220212020
U.S.
Companion animal$3,341 $2,990 $2,391 
Livestock972 1,052 1,166 
4,313 4,042 3,557 
International
Companion animal1,862 1,699 1,261 
Livestock1,819 1,953 1,774 
3,681 3,652 3,035 
Total
Companion animal5,203 4,689 3,652 
Livestock2,791 3,005 2,940 
Contract manufacturing & human health86 82 83 
Total Revenue$8,080 $7,776 $6,675 
Revenue by species
Year Ended December 31,
(MILLIONS OF DOLLARS)202220212020
Companion Animal:
Dogs and Cats$4,939 $4,426 $3,437 
Horses264 263 215 
5,203 4,689 3,652 
Livestock:
Cattle1,440 1,557 1,558 
Swine565 659 621 
Poultry476 507 537 
Fish212 187 148 
Sheep and other98 95 76 
2,791 3,005 2,940 
Contract manufacturing & human health86 82 83 
Total Revenue$8,080 $7,776 $6,675 
Revenue by product category
Year Ended December 31,
(MILLIONS OF DOLLARS)202220212020
Parasiticides$1,860 $1,635 $1,173 
Vaccines1,718 1,673 1,476 
Dermatology1,329 1,180 941 
Anti-infectives1,081 1,215 1,206 
Other pharmaceuticals1,043 966 821 
Medicated feed additives360 420 460 
Animal health diagnostics353 374 305 
Other non-pharmaceuticals250 231 210 
7,994 7,694 6,592 
Contract manufacturing & human health86 82 83 
Total Revenue$8,080 $7,776 $6,675 
B. Other Revenue Information
Significant Customers
We primarily sell our companion animal products to veterinarians or to third-party veterinary distributors that typically then sell our products to veterinarians, and in each case, veterinarians then typically sell our products to pet owners. In certain markets, we also sell certain companion animal products through retail and e-commerce outlets. We sell our livestock products primarily to veterinarians and livestock producers, including beef and dairy farmers as well as pork and poultry operations, in addition to third-party veterinary distributors and retail outlets who then typically sell the products to livestock producers. Sales to our largest customer, a U.S. veterinary distributor, represented approximately 14% of total revenue for 2022, 2021 and 2020.