As at 3pm, the firm's shares were up 1.83 per cent, to trade at 222.5 pence.

Shares in veterinary pharmaceutical company ECO Animal Health (LON:EAH) gained around 5 per cent today after it received a key approval for its Aivlosin product in Canada.

It revealed today that the Veterinary Drugs Directorate (VDD) of Health Canada has granted a marketing authorisation for Aivlosin 625 mg/g water soluble granules for pigs.

This formulation will be marketed for the treatment of an enteric disease of pigs, ECO said.

The firm said that this is the group’s first approval in North America and it marks a very important step in its development of Aivlosin as a global veterinary product. 

“Following years of investment in regulatory applications in North America via our Princeton, New Jersey office, we are delighted to receive our first registration in this important continent,” said chairman and chief executive Peter Lawrence.

“Canada and the USA represent more than one third of the world market for our products and this breakthrough will benefit our future profitable growth. 

He added: “We expect our first approval from the FDA in the USA in the near future. 

“This approval, coupled with our existing approvals in other countries, will in effect give us the rights to sell Aivlosin around the world. This will be another important step in making ECO one of the most important global animal health companies”.

According to ECO, Canada is currently enjoying an increase in its pig population following consolidation among producers, which bodes well for company. ECO has established its own company in Canada to help ensure a successful launch.

Aivlosin is a water soluble product which comes in the form of granules that dissolve readily in water. This enables a simple solution for the accurate and simultaneous treatment of large numbers of animals.

The company said that the new Canadian approval means that ECO can extend its marketing reach for Aivlosin.

ECO also noted that it will announce its interim results on Monday 12 December.

ECO Animal Health Group (LON:EAH), the maker of environmentally-friendly drugs for livestock, said its current financial year had started well after reporting a strong increase in profit and revenue for the 12 months to 31 March.

ECO said it had seen positive trends in many of its key markets. Demand from China, its largest market, is strong and it continues to build a presence there and in other important territories. The firm added that it was optimistic that it would soon received clearance from the US Food and Drug Administration to begin sales of Aivlosin – its flagship drug that is used to provide control of major respiratory and enteric diseases in both pigs and poultry – in that country.

Today’s results showed that the group increased its turnover for the year to 31 March by 24.4 per cent to £27.1 million (2010: £21.7 million), while its profit – before non-cash charges such as tax, depreciation and amortisation – improved by more than 16 per cent to £6.4 million.

Cash generation at the business continued to be strong, with £8.5 million generated comparedwith  £3.3 million in 2010. The firm said that this was achieved thanks to the ongoing implementation of its aggressive stock and debtor management policies

 ECO has declared a dividend of three pence per share for the year – an increase of 30 per cent over the 2.3 pence it declared for 2010.

“ECO Animal Health Group has delivered another strong set of results for the year ended 31 March 2011 and the current year has started well,” said Peter Lawrence, ECO’s executive chairman. “Overall, ECO is well positioned with an excellent product range, exciting growth opportunities and potentially very important new products in the development phase. The company is poised to accelerate its growth and continue to deliver value to its shareholders.”

ECO, one of AIM’s longest-standing companies (it has been traded on London’s junior market since 1995 when it was known as Lawrence plc), was expected to deliver a 30 percent increase in revenues to £28.3 million for its 2011 financial year along with an adjusted pre-tax profit of £3.1 million, according to estimates made earlier this year house broker Cenkos Securities.

Accounting for almost 60 percent of ECO Animal Health’s sales, the group’s flagship product Aivlosin is a drug containing the animal antibiotic tylvalosin.

It is rapidly absorbed by animals and concentrates in target tissues to provide control of major respiratory and enteric diseases in both pigs and poultry. So far, it is licensed only for respiratory and enteric bacterial diseases in pigs and poultry, but the drug has potential to be used for other purposes.

ECO Animal Health’s range also includes Ecomectin, which is its second-biggest selling product. This endectocide is used for a broad range of parasite control, including the treatment and control of gastro-intestinal roundworms, lungworms, grubs, horn flies, sucking and biting lice as well as mites.

Results for the first half of its 2011 financial year showed that sales of Aivlosin were 55 percent ahead of H1 2010, while sales of Ecomectin were ahead by 21 percent. The boost in sales of Ecomectin was a reflection of increased demand in Japan, where the active ingredient in the product was discovered, and the well-received launch of Ecomectin in Mexico.

In March, ECO said that the staff and facilities of its Japanese subsidiary, Ecopharma, had not been affected by the earthquake and tsunami in that country.

The firm added that Ecopharma had traded satisfactorily in the second half of the 2011 financial year and its expected to deliver a full-year results in line with its budget.

In this morning’s interim results statement, for the six months ended 30 September 2010, the group reported a 39 percent increase in turnover from continuing operations to £12.3 million (H109: £8.9 million).

Earnings (EBITDA) increased 15 percent to £2.24 million (H109: £1.94 million), and pretax profits rose to £500,000 (H109:£385,000).

“The momentum of the first half of the year is being maintained, boosted by further sales growth in our main markets,” Lawrence said.

“Overall we look forward with confidence, well placed to deliver another period of sound performance.”

Operationally, ECO highlighted that sales of its lead product Aivlosin - a antibiotic treatment for pigs and poultry – were 55 percent ahead of 2009 and it is currently being prepared to be launched in the United States.

It said that trading in its major markets - China, Japan and Latin America - continued to develop positively.

Looking to the rest of the financial year, ECO noted that the second half has historically produced a larger proportion of sales and profit as its customers treat winter and spring diseases among their livestock. 

The company ended the period with a strong balance sheet.

On the 30 September it had net cash of £9.8 million, after it generated £6.2 million in the period.

Killik & Co analyst Jonathan Jackson commented: "we continue to believe that the current share price is overly discounting the approval prospects for (Aivlosin in the USA), and for this reason we remain buyers."

Pre-tax earnings per share from continuing operations jumped 36% to 3.49 pence.

The company generated £3.3 million of cash from operating activities during the year compared to last year’s £2.3 million.

The board has reviewed the company’s short term cash requirements and, after generating cash of over £3.3 million from operations, reinvested all of it and more to expand the business and create a larger group.

“It is important that the company manages its cash to ensure the successful and rapid launch of Aivlosin into the US market, as soon as the anticipated and long awaited regulatory approvals are received,” ECO said in the report.

The company declared a dividend of 2.3 pence per share to “immediately apply more funds to continue development, enter new markets and increase its share of existing markets.”

The committed undrawn net facilities of the group were £1 million, unchanged from 2009.
Shares in the company were up nearly 6% in midmorning deals, albeit off earlier highs just after the release of the results.

The facility manufactures the Aivlosin active pharmaceutical ingredient.

The company said the approval marks a very important milestone in the development and registration programme for Aivlosin in the USA.

The facility has already been approved by EU and Japanese regulatory authorities.

ECO Animal Health Group develops, registers and markets pharmaceutical products for global animal health markets. Its products for these growth markets promote well-being in animals and include the novel macrolide antibiotic, Aivlosin, as well as a range of generic therapeutic products.

Aivlosin targets a wide range of diseases spanning from enzootic pneumonia to swine dysentery. The drug has been approved for use in pigs and poultry in Europe, South Africa, Japan, Asia and South America with ECO expecting it to receive approvals soon for use in pigs in the United States.

The group’s other products include Chlortet, which is aimed at controlling E.coli infections, and performance promoters such as Flaveco, designed to improve efficiency and growth in pigs.

ECO also announced that its full-year results, for the year ended 31 March 2010, will be published on 10 August 2010.

This new formulation is aimed at treating and preventing of the respiratory disease swine enzootic pneumonia and the enteric disease swine dysentery as well as the treatment of the enteric disease porcine proliferative enteropathy for pig farms of all sizes. Eco said the new concentrated form with compact packaging and lower transportation costs would help cut manufacturing and distribution costs.

The company said the approval from EMEA represented another important step in its continuing development of Aivlosin as a global veterinary product.

EMEA approved Eco’s Aivlosin granules for oral solution for medicated drinking water for pheasants earlier this week.

Aivlosin is Eco’s flagship product, targeting a wide range of diseases spanning from enzootic pneumonia to swine dysentery and accounting for more than half of its sales. The drug has been approved for use pigs and poultry in Europe, South Africa, Japan, Asia and South America with ECO expecting it to receive approvals for use in pigs in the United States.

The European market for drugs treating mycoplasmal respiratory disease in poultry alone is worth about £10 million per year, while the segment for drugs targeting ileitis is estimated at £18 million annually.

Eco’s other products include endectocide Ecomectin, which addresses a market currently worth £8 million in Europe, theurapeutics including Chlortet, which is aimed at controlling E.coli infections, and performance promoters such as Flaveco, designed to improve efficiency and growth in pigs.

Aivlosin will be used in pheasants for the treatment of respiratory disease caused by Mycoplasma gallisepticum, one of the most economically important diseases of farmed pheasants. ECO said there was an “unmet demand” for this kind of a product in the market, with Aivlosin being the first authorised product for the treatment of this condition.

The product will be marketed directly to specialist poultry veterinarians in the UK, which, along with France, accounts for the majority of intensively reared pheasants in the EU with 30 million birds reared in these two countries annually.

Aivlosin is Eco’s flagship product, targeting a wide range of diseases spanning from enzootic pneumonia to swine dysentery and accounting for more than half of its sales. The drug has also been approved for use pigs and poultry in Europe, South Africa, Japan, Asia and South America with ECO expecting it to receive approvals for use in pigs in the United States.

The European market for drugs treating mycoplasmal respiratory disease in poultry alone is worth about £10 million per year, while the segment for drugs targeting ileitis is estimated at £18 million annually.

Eco’s other products include endectocide Ecomectin, which addresses a market currently worth £8 million in Europe, theurapeutics including Chlortet, which is aimed at controlling E.coli infections, and performance promoters such as Flaveco, designed to improve efficiency and growth in pigs.
Shares in Eco rallied 14% on the news.

In a pre-close trading update, the group said it has, in part, benefited from the significant movements in the US dollar, its principal trading currency, against sterling in the period.

ECO Animal Health develops, registers and markets pharmaceutical products for livestock and companion animals.