---start med.lec.05.08.97---


Production Medicine by David T Galligan, VMD MBA
this shall be INFORMAL
basically what happened a few yrs ago when reevaluating the curriculum, 
Galligan gave some lectures to the faculty and it was decided to 
integrate this into the medicine course.

no excessive note taking needed. will say three times the things that are 
going to be on the exam. listen to issues, arguments, etc. those of us 
going into small animal, just learn so you can know what your colleagues 
are going into.

"herd health" big buzzword of the 70s. visiting herd same day every 
month, etc.
"evil people exploiting animals" buzzword of 90s. perhaps true in some 
cases, but not everywhere.
"what is the future of production medicine?"
"what do we do now?"
vets hanging out in bars are concerned about what their jobs will be in 
10 yrs...eg, bovine practicioners etc. cows have increased production per 
cow by about 20% in last decade or so. in other species, like poultry, 
pigs, etc, productivity/animal has also increased. that biological aspect 
is always happening, and has healthcare consequences.

main species we will discuss today is the cow. we'll review the life 
cycle of the cow.

CONCEPTION
GESTATION 9 mos
BORN
HEIFER breed at 15 mos calve at 24 mos
CALVE
LACTATE -305 days
DRY - 60 days
breed again.

cow goes through this cycle about 3 times on average. culling can occur 
at any point in the cycle, but more often later in life.
conception rate efficiency: has been manipulated
length of gestation and heifer rearing: 27 mos is avg age of first 
calving - could try to reduce this.

these issues affect the value of the animals.
over time, milk price has been dropping - price/100 lb of milk has 
dropped DRASTICALLY since 1983. about a $4.00 drop from $13 to $9.

now people say since amt/cow is going up, drop in price is less 
important, since each cow is more valuable. cows can make 50,000 lbs 
milk/yr
but "net income" of each cow is decreased.you can buy more of a cow with 
an hour of labor than you used to be able to. so, farmers can't spend as 
much money on healthcare for cows, because each cow is making less money 
than it used to.  

*****
general trend: individual animal value has decreased: due to increased #s 
of animals in herds, better health care. this has dramatic effects on the 
kind of care we can provide
*****

relative value of chickens and pigs has also dropped. we pay a lot less 
for a pound of chicken than we used to - used to be so hard to raise 
chickens, they would die and stuff. but now biology better understood, 
farms can mass produce chickens, and chicken is cheap. same thing with 
hogs. decrease in value/hog.

the trend represents changes in animal husbandry and veterinary medicine. 
these industries are getting more homogeneous. each farm is the same. 
they all do it the same way. they know what works! to depart from the 
formula is inefficient.

so animal value is DECREASING!!!!

milk value above beef prices- income recieved from a cow above the meat 
price. a dairy farm has two industries: milk and meat. meat is a sizable 
part of dairy farm income.

as value of products (milk) has dropped, number of farmers has dropped. 
about 2%/yr in lancaster pa go out of business. also true w/chickens, 
etc. about 85% of the pigs in PA are on 10% of the farms...so farm 
numbers are decreasing as fx of new technology, etc. many people are 
upset about this. people like to travel through rural areas and see nice 
farms and stuff. but if society won't pay more for milk, these people 
can't make money. now some countries eg italy, holland, know that farmers 
are good for tourism, and they've set up systems eg in italy, farmer 
can't feed corn silage to dairy cows - if they did, cows would be inside. 
have to keep cows outside. they lie, and say it affeccts flavor of 
cheese, but really, taste tests disprove this. they just wanna keep the 
cows outside so tourists will stop and buy cheese.
PA main industry: dairy farming. 20% of population is involved. our 
second industry is tourism which is in fact tied to the dairy 
industry/"amish countryside". but amish finding it harder to make $ this 
way.


*****
Farm numbers have decreased; farm SIZE has increased. cow,pig,chicken. 
bigger farms, but fewer of them, exist now.
*****

<59 cows --> .4% return on assets
60-89: 2.39%
90-119:2.79%
>120 cows ---> 4.61% return on asset

herd has to double in size every ten years to maintain cash flow, or 
something like that.

economies of scale:

herd size vs cost of production. as we increase herd size, cost of 
production goes down. at about 200 cows, you have a huge gain in economy, 
above 200 cows there are smaller efficiencies. eventually, if you go to a 
HUGE # of cows, you should see the curve start going back up. so it 
should be a U shaped function. but no one gets that many cows in one 
place :)

if you are going into the dairy industry, you should get at least 200 
cows to maximize your efficiency.

what makes a dairy farm profitable?
higher milk production does not mean more money - other factors exist.
some cows can make up to 30,000 lbs milk/yr. our cows make about 23,000 
lbs/yr.
you can get high milk production inefficiently.
if you have a 30,000 lb/yr cow and a 10,000 lb/yr cow, and you cull the 
10,000 lb/yr cow, you now have a higher production/cow average - but this 
is a very inefficient way of doing things.

production med vets want to help maximize profit and production together. 
"health" is defined within an economic context in this field.

the problems we face in animal agriculture are changing. we used to go 
look for the single infectious agent, focusing on the individual animal. 
diagnosis was sample driven, and intervention was on a treatment based 
system, reactive method. now we look at nutrition, housing, management as 
well as infectious agent. focus is on the herd. we do production 
evaluations, we focus on prevention and treatment is proactive, not 
reactive.

eg: the farmer could be calving the heifers at 28 mos of age, and losing 
money because of it. vet should advise of this. or he's buying feed at 
the wrong price, or whatever. we should take a broader view of the farm. 

[i don't like this idea. why would a DVM/VMD want to be a farm consultant 
instead of a doctor?]

what are some of our approaches to disease? in broad categories...
1. let disease occur, and then treat it. "small animal model." used to be 
followed in food animal industry. works very well w/dz that has low 
incidence and effective tx.
2. minimize period of risk. in dairy cows, this is calving time. 90% of 
problems occur within 4 wks of calving. so if calving is a problem, do it 
less often. have an extended window between calvings. calve every 
15-18mos instead of every 13.
3. preventive programs: milk fever occurs w/high frequency. change amt of 
calcium in diet - easy to prevent, so won't need to treat. 

how do you get money from the farmer for preventing things? usually, 
farmer pays you for fixing a problem. 

let's look at approach one: let dz occur and then treat. is there a 
future in this? using a decision tree...way of representing decision 
process, where you want to intervene or send cow to salvage (cull). 
choices are represented by a box. if you send cow for salvage, you get 
$400 for her, for sure. if you decide to intervene, there can be a good 
or bad outcome. this is a risky event, with a chance element. if there is 
a good outcome, cow is worth $800, tx cost $120. if outcome is bad, cow 
ends up being worth $400, but still pay the $120.

this is a typical problem. farmers deal with this problem every day. what 
influences our decisions here? probability. how often does a good outcome 
occur? you put probability numbers on there. if 80% chance of good 
outcome, and 20% chance of bad outcome....expected value is $600. on 
average, using this on many many animals, your avg value of intervention 
is $600, while nonintervention only ever yields $400. so it makes sense 
to intervene.

probability of success has to be greater than ratio of tx cost over the 
value of healthy cow minus value of salvage.

p[successs] > tx cost/ (healthy cow value - salvage value)

so when you look at this, you gain the ability to step back and look at 
this in a generic perspective. as animal values continue to decrease, you 
need to drop treatment cost or raise probability of success, or start 
culling more often.

ANIMAL VALUE IS DROPPING and is critical, drives the whole thing. in 
small animal med, we treat because animals have HIGH VALUE. in production 
medicine, animals have LOW VALUE. we do not treat as often.

decision trees can get very elaborate
boy, he's going off on tihs value vs intervention thing. "multiway 
sensitivity" chart.

so, in food animals, letting problems occur and then treating them has a 
very limited future. part of the problem with many herd health 
interventions historically has been that you'd go to the farm on the 
right day and you'd find all these problem cows on that day, instead of 
finding them all during the month. you really need to focus on preventive 
care. treatment has a limited future. last year, someone got really upset 
in this lecture because he wanted to take care of cows and was upset that 
his dream job really won't exist in the future.

combinations of interventions...might treat some animals one way and 
others another way. need to plot expected return vs risk, variation. 
remember, an individual cow has a good or bad outcome. but you do a lot 
of cows, it averages out.  combining different treatments can help to 
reduce the variation in the outcome, reducing risk and maintaining a high 
return.

---break----

PINK FLAMINGO may 22, its fun, BLT bikini, lingerie, toga party. at alpha 
psi. fun - show up.

OK! one final thing to say about this re: tx of individual 
animals...concept of competitive risk. we face ths problem in healthcare 
interventions in food animal species, where we often put money up front 
for tx but return is not realized for a long time. sometimes you pay up 
front for healthcare, but don't get return for long time.

******
treatment interventions offer considerable competitive risk and therefore 
a lower return to producers
******

so you treat FEWER cows, you treat MORE VALUABLE cows. you focus more on 
preventative medicine.

barn design: modern barn (marshak dairy) has all the amenities, design 
has evolved over time. stalls optimized for size of particular cow breed.


if you go into a barn and the cows are lying in their free stalls, that's 
a good sign. cows lay on L side more often than right. why? fluid line 
changes when you switch sides. L side promotes rumenation. cows also make 
more milk when they are lying down.

calf hutches. decrease incidence of calf dz dramatically. this new 
housing has drastically changed incidence of disease.

milking parlor: different from stanchion barn. cows enter parlor. between 
rows of cows is a pit. each cow is the next cow's restraining device - 
line up in herringbone pattern, ten on each side. in the pit in between, 
floor is ergonomically designed to relieve stress on milker. milking 
equipment is low lying. technique is well defined. a guy cleans all the 
udders, sanitizes them, washes them,etc. this promotes oxytocin 
release/milk letdown. then machine is put onto cow, hopefully w/o much 
air getting into the system which can promote mastitis. cow is milked. 
milking needs a special technique. there are pressure sensors to sense 
when udder is empty. note; milking machine uses a vacuum technique. after 
milking, teats are dipped in disinfectant as mastitis prevention. also 
cows are fed after milking, so they'll stand and eat, giving time for 
teat sphincter to contract before cow lies down. milk computer takes in 
all this info about the cow - how much milk she made, etc. when cow 
enters parlor, her collar transmits info to the computer. samples are 
taken from milking system too, for fat tests, protein tests, etc. also we 
time how long it takes to milk cow. one cow takes 20 minutes, makes 96 
lbs/day, but holds up the whole line.
cows all leave milk parlor together, go for teat dips, then back to free 
stall area. new rapid cooler: cools the milk. there's a heat exchanger - 
heats water. water goes to flush system. flush system flushes manure out 
behind the stalls.
some dairys are now milking 3x/day instead of two...increasing production 
18%. dutch dairys are now starting to have 'free choice' milking!!! 
automatic milkers that cows just go on up to when they feel like it.

waste handling: solid/water - try to separate out, reuse nutrients, max 
efficienty.

feed handling: inefficiency w/feed carries all the way through the whole 
production system. KNOW YOUR NUTRITION!
front end loaders, scoop feed up, buy feed in bulk, get quantity 
discount, mix up in mixer wagon that feeds mixed feed out of it. built in 
scale. time the mixing, don't chop too quickly.

water in flush tanks is recycled water, btw.
the PARLOR water is clean. that is flushed less frequently.

everything is computerized re: records, etc. managing the information is 
a huge deal. need to know which cows are in heat, which cows make most 
milk, who's going to calve, etc.

optimal breeding window: biological restriction, then optimal time, then 
lower profit time, then you actually start getting into a time when you 
LOSE money.

so that was a quick overview of dairy industry eg housing etc.

what is disease, then? traditional disease...we know that. but also 
disease or problems in a herd in terms of lacking optimal production..we 
know the technology of the industry. if we don't take advantage of that, 
we don't acheive goals and we lose money. so dz = failing to implement 
new technology and take advantage of opportunities.

bottlenecks in production: not defined biologically, but economically. 
what is the return on my dollar invested in this area of the farm? on a 
farm there are many bottlenecks. ther are a lot of problems: nutrition, 
heifer rearing, etc. different priorities on different farms. ranking of 
things should be by what offers most marginal return. if you have a 
problem that costs $20k and a problem that costs $5k which do you solve? 
the one that gives you the most RETURN! the cost isn't as important. if 
you put money into fixing it, what do you get OUT??

moving on...we have problems where the producers are interested in issues 
like feed cost, product choice, etc. dz=failing to use BSG! producers not 
using the hormone are losing productivity, losing out wrt other dairies. 
have to implement new technologies to stay on the up side! breeding 
plans, culling choices, etc, all issues faced by farmers. need to figure 
out what is maximum return.

we can divide efforts into three areas. cow = production unit. she 
calves. we feed her. she gives us milk. early on we get 3:1 return, later 
we get 1:1 return (cost of feed: value of milk.) we can control COST of 
feed, can try to enhance PRODUCTION, and can try to INCREASE TIME spent 
in "early lactation" because that milk is worth more.  in the past, repro 
interventions were based on going out and txing cows - farmer would show 
you problem cow and you'd tx it. now, there are systematic programs. 
"target breeding program" - farmer doesn't present you w/problem cow. you 
put whole herd on program. cows all calve, then wait, then at 50 days in 
lactation they're all injected to come into heat, then they're bred, etc. 
you don't wait around - you use a proactive system! it's not based on 
individual cows - is based on whole herd. uses prinicples of average 
return. a 400 cow herd that went on the breeding program had cows that 
got pregnant faster, and in synchronized groups. instead of injecting 
individual problem cows with prostoglandin, you treat the whole heard and 
there's areal difference. you inject, breed, those that don't take you 
try again etc. after first inj, 70% of cows will come into heat in 
theory, maybe 50% in practice show signs of heat. then you breed 50% and 
then reinject the rest, etc. how many times should you rebreed a cow? 
well, what is age, production capability, and alternative to breeding? 
can you replace cow?

----break----

american bovine practicioner meetings tend to focus on nutrition
nutrition is a huge deal with cows
repro strategies in herd base are a huge deal
decision trees are widely used
product selection tools are widely used.
bull selection is important
farm forecast simulation tools are evolving.

ration savings in feed cost- buying feed more efficiently eg in commodity 
forms, you save say 14% of feed cost. feed is about 50% the value of 
milk! huge number.

years ago, bovine practice frustrating. treating sick cows, losing money, 
etc. started a program - changed feed, reduced cost $1600/week (feed 
cost) (Just buying more efficient feed). at the same time, there was a 
dramatic increase in milk production. this was the first time they ever 
made a profit in their dairy division. (this particular farm). if you are 
going to work with dairy cows: LEARN NUTRITION

bull selection: local herd around here was spending $35,000/yr on 1300 
breedings, about 27 bucks per breeding. cost per conception was 54 bucks. 
cost per heifer produced more like 100! (50% males). using a software 
program, chose bulls to meet same reliability genetically, but spending 
only 16,000/yr on the 1300 breedings. there are different pricing schemes 
in bulls. this herd had no system for evaluating if a bull was 
overpriced. they established breeding goals, and figured out what cheaper 
bulls would meet the same need, or if they could use same bulls, less 
often, or whatever.
one problem when you show producers these cost savings, b/c of the huge 
amt of money they can save they think you are kidding them or scamming 
them and they are skeptical and reluctant to deal with you. they think 
you're not for real. 

also: which cows get bred to which bulls is important.

bull selection: reliabilty: index of how many daughters we have info on 
from that bull. as # of daughters with info increases, this number will 
go up. want to use = or higher reliability when developing these plans. 
also predicted $ in terms of value of milk, fat, protein. so amt of money 
you can expect to make on this bull, above other bulls. same with 
predicted milk, etc. predicted # difficult births.

to come up with differences between bulls, they have to go to heifers 
calving in winter having male calves, having dystocia. so you don't wanna 
put alot of weight on that. - WHAT??no idea what he meant by that. 

can also look at udder depth, teat depth, leg angle, etc. but 
heritability not that high in those. when you go into dairy repro this is 
covered in more detail. 

RETURN ON INVESTMENT:
producer minimizes risk of disease by recalving at lower frequency 
(higher interval betwen births) right? here is a graph showing return per 
dollar as you change interval. go from 9 months between calves out to 30 
mos between calves. 


BST: response influences lactation curves
diff between early milk vs late milk isn't as great. so advantage of 
quick recalving isn't as great. using BST can keep cows in herd longer.

CULLING
tied to economic principles. we want to maximize net value of cow.
you have semen cost, gestation cost (rent), raising cost, dry period 
costs.
you have cash in from lactation periods
if you go through more lactations, you spread fixed costs over more cash 
in periods. but when do you cull? you want to not lose money on the cow.
as cows age, their survivability decreases. a 7th lactation animal is on 
the edge...different cows have different culling rates. what you can do 
is to look at cash flow of a cow, health care costs, etc.
many more costs associated with early lactation, low cost in late 
lactation. older cows have more problems. if you hang onto a cow you 
might get into problems.

economically sick cows: how do you diagnose them? you first of all - 
don't think you have to keep a cow as long as possible. instead of 
keeping really old cow might want to replace with better cow.
highest profiting herds had 46% cull rate! culling is not bad. lowest 
profiting herds had 34% cull rate. need to know how to remove ineffective 
cows effectivly and efficiently. 

what value of constant cash flow per unit of time is equivalent to an 
annuity value? oh this is so far beyond me. ask Julie Stephenson about 
this stuff, she was an accountant in her former life.

simulation models, yada yada

cash flows w/dairy cows:
years/money
1/-600, 2/-400, 3/1500, 4/1700, 5/1700, 6/400(culled)
add it up - it works out to an amount a year for 6 yrs...

future annuity value...is influenced by production efficiency, survival 
chances,cost savings,etc.

you want to REPLACE the cow when her value drops below that of her 
ORIGINAL value. you don't want to wait til her value actually drops to 
ZERO.

[note: he keeps making dumb semen jokes.]
"there's a heifer in my herd and i don't know who she is, but in three 
years she'll be milking better than any of my other cows. so that's where 
I want to put my expensive semen in."

subtleties are invovled.

concept currently being worked on: animal value in time.when calf is born 
it is born during a calendar month (duh) and so it faces a bunch of 
biological/seasonal factors. producers influence ultimately what season a 
cow calves in by how quickly puberty occurs. puberty is wt dependent. can 
control growth rate. increase prepubertal growth rate or decrease so she 
is in season at the right time. try to capture seasonal benefits. want 
calves born in certain months. plot growth rates to ensure first cycle 
occurs at right time. etc.

what is worst time for animal to die? at first calving. have put a lot of 
money into her, but not gotten any out yet. but risk of milk fever 
increases with age. so that's not a very expensive dz, occurs in old 
animals. calf-killing dz not too expensive...haven't sunk lots of money 
into very young calf yet.

*********
VERY IMPORTANT THINGS:
1. animal value is decreasing and will continue to decrease in the 
future.
2. farm sizes increasing - animals/farm - pigs, poultry, cow
3. individual animal healthcare has many economically inefficient 
attributes
   this influences value people have on animal healthcare
4. more and more healthcare will be efficiency driven. not treating 
should be     as important as treating.
5. know economically sick animals as well as biologically sick animals.
*********

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