Sen. Elizabeth Warren Targets Private Equity Company for Consolidating Veterinary Sector, Raising Costs

August 16, 2024

U.S. Senators Elizabeth Warren (D-Mass.) and Richard Blumenthal (D-Conn.) recently sent a letter to JAB Holding Company (JAB) requesting extensive details about JAB’s interests in veterinary practices and pet insurers. “Over the past decade, private equity firms like JAB have launched a large-scale effort to buy up small veterinary practices and consolidate them under the ownership of larger corporations. JAB, in particular, has received significant regulatory scrutiny for the scale and speed with which it has acquired veterinary practices and other pet-related companies. The FTC has twice ordered JAB to divest clinics in concentrated regional markets.” Corporate consolidation of veterinary care and an accompanying rise in prices represents a major issue for American consumers and a life and death issue for their pets, according to the PRESS RELEASE — senators also urged the FTC and Congress to take stronger action against consolidation in the veterinary care industry.

Veterinarians at private equity-owned practices have reported being overworked and pressured to upsell patients on expensive tests and procedures. At some practices, corporate managers require clinicians to meet demanding quotas for certain procedures, tying their income to the amount of revenue that they generate.

To understand the impact that the acquisition sprees of JAB and other private equity firms have had on veterinary practices across the country, the senators asked JAB to provide answers including some of the following questions (refer to senators letter, to view all questions) no later than August 21, 2024:

  • List all veterinary practices JAB has acquired in the United States since 2019.
  • Revenue and average net income per practice.
  • Average rates that these clinics charge for checkups, spay and neutering, and other common health issues, procedures, and treatments.
  • Number of veterinarians and veterinary technicians employed at their clinics, as well as their average salaries.

JAB Holding Company investments in petcare include National Veterinary Associates (NVA) and Ethos Veterinary Health:

  • NVA’s network consists of approximately 1,400 locations consisting primarily of general practice veterinary hospitals in addition to equine hospitals and pet resorts and Ethos Veterinary Health owns 145 specialty and emergency hospitals.

Individual general practice locations that are owned, operated and or controlled by National Veterinary Associates (NVA) are not displayed on the NVA website.

Private equity firm KKR which owns PetVet Care Centers also received a letter from the Senators. PetVet’s national network includes more than 450 general, specialty and emergency veterinary hospitals. A spokesperson from KKR stated we have received Senator Blumenthal’s letter and will respond.

UPDATED: SEPTEMBER 20, 2024: JAB’s response letter

RELATED:

  • Private Equity is Coming for your Cats and Dogs (8.13.24)
    https://www.bostonglobe.com/2024/08/13/opinion/vet-bills-expensive-private-equity-elizabeth-warren/

    • Some veterinarians and technicians in private equity-bought practices are being pressured to generate more business. “It becomes an environment for them to be kind of cutthroat because they’re trying to make a commission,” the vet tech told me in regard to a nearby vet business that was bought by a private equity-backed hospital. “Their doctors and staff are probably instructed to sell as much as they can.”
  • Employee Reviews of National Veterinary Associates (NVA):
    • A good indicator of a company’s true priorities can be determined by listening to its employees:
      GLASSDOOR | INDEED
  • What’s Behind The High Cost of Vet Care?
    https://www.pets.care/news/2024/05/whats-behind-the-high-cost-of-vet-care/

    • Preliminary research found significant differences in pricing between corporate and privately owned veterinary clinics in the same geographic region. Usually, the increases “occurred immediately after the sale to a private-equity-owned group.”