We see 2021 as heralding some game-changing innovations in the Animal Health industry-both from large and smaller companies.While valuations seem high， the potential for a new wave of growth drivers-across drugs， devices and services-are likely to ensure valuations stab liz eat these levels.Along with the wave of potential Biologic launches like Libre la， So lens i a(from ZTS) ， CPV(KIN/ELAN) or environmental- friendly products like Experior(ELAN) ， we also look at advancements like progress on Gene Therapy for Pets， ASF Vaccines， half-life extension tech.Despite the acceleration of E-Commerce post COVID， both AH drug and diagnostics firms focus on and entrench Vets as the center of the Petcare business.This is likely to kickstart a cycle of growth for AH Vets， Clinics and Hospitals(Refer to our recent Qtrly Vet Survey) .Investor appetite， in our view， is high for strong AH plays， and we believe this could translate to potential unlocking of value， noting that Merck&Boehringer Ingelheim have the 3rd&4h largest global AH businesses， or niche portfolio/technology acquisitions.

New Innovations to expand TAM in the Animal Health World， driven by recent and upcoming launches：1) Additional petcare biologics-including ZTS'canine&feline OAm Abs， CPV from ELAN/KIN； 2) Gene Therapy for pets， led by niche companies in areas such as anemia， a topic dermatitis， metabolic diseases， chronic pain， and rare diseases， among others； 3) Newer AB technology， like KIN's Half-Life Extension Tech (OW) or smaller firms like In vet x， which blends multiple technologies in its MAB Discovery Platform； 4) New farm-tech(quantified Ag， Clari fide Plus) ； and 5) Multiple diagnostic and Tech offerings for Vets incl ZTS'VetscanImagystandIDXX's(not covered) ProCyte One He mat Analyzer.

Additional pure-play AH companies likely to emerge， tapping current market sentiments and investor appetite for steady growth.Boehringer Ingelheim and others have sizeable AH businesses， and we would not be surprised to see these businesses being spun out， much like ZTS separated from PFEin2013andELAN separated from LLY in 2018.We note reports(link) that India based Z yd us could divest its AH business.