Virbac Acquires Delmarva Laboratories; Transaction Further Strengthens Veterinary Business Segment.

Business Editors

FORT WORTH, Texas--(BUSINESS WIRE)--Aug. 18, 2003

Virbac Corporation (NASDAQ, NM: VBAC), a leading companion animal health company, announced today that it has acquired the stock of Delmarva Laboratories, a privately held veterinary pharmaceuticals company based in Midlothian, Virginia. The all-cash transaction, which closed August 15, is expected to be immediately accretive and non-dilutive to shareholders. The acquisition strengthens and enhances Virbac's position in the rapidly growing veterinary market.

Delmarva achieved 2002 sales of $3.8 million led by Euthasol(R) and Pentasol(R), both of which are humane, painless, and rapid euthanasia products, and Biomox(R) amoxicillin, a broad-spectrum antibiotic, formulated in convenient liquid and tablet dosage forms. Amoxicillin is widely used to treat bacterial infections in dogs and cats. Included in the 2002 results were $0.4 million of sales in an equipment line that was divested prior to Virbac's purchase.

The transaction also includes the recently FDA registered, but not yet launched, clindamycin product line. Clindamycin, also formulated in convenient liquid and tablet dosage forms, is an effective antibiotic for the treatment of soft tissue infections. Clindamycin is recognized as the leading antibiotic in treating dental infections and provides an excellent strategic fit with Virbac's current C.E.T.(R) oral hygiene line of products.

Biomox provides broad-spectrum activity, including the treatment for bacterial dermatitis. Thus, this product further reinforces Virbac's market leadership position in dermatology. Biomox sales have been temporarily interrupted as the company awaits approval of a manufacturing site transfer.

The company estimates the U.S. companion animal market for the acquired antibiotics is approximately $29 million and for the acquired euthanasia products approximately $7 million. Delmarva, led by Euthasol, has an approximate 25% share of the euthanasia market. Both market segments have been achieving annual double-digit growth rates outpacing the growth of the overall veterinary market.

Thomas L. Bell, Virbac's president and chief executive officer, commented, "The strategic value and rationale for the acquisition rests on the product fit. Broad-spectrum antibiotics and euthanasia products are core to every veterinary clinic. In addition, the antibiotics are very complementary to our existing dermatology and dental product lines. Virbac's job will be to focus its experienced sales and technical service personnel to enhance the already excellent results that Delmarva has achieved to date by increasing market share of existing products. We also look forward to launching the exciting new clindamycin product range." Bell further stated, "In-house manufacturing opportunities will also be explored at our FDA-approved facility in St. Louis, Missouri."

Preston L. Parrish, Delmarva's president, commented, "We are very pleased to have Virbac acquire Delmarva Laboratories. Virbac is one of the fastest growing companies in the animal health industry and has a well-recognized and respected management team and sales force. The Delmarva portfolio of pharmaceuticals fits well with Virbac's growth strategy, and we are confident that Virbac, with its exclusive focus on animal health, will build on our successes."

Mr. Bell added, "We are quite pleased with the Delmarva acquisition as it further improves Virbac's position in the $1.6 billion U.S. companion animal pharmaceutical market. Select strategic acquisitions, coupled with our in-house new product development efforts, are proving to be a successful model to further penetrate this tremendous market opportunity."

Virbac Corporation, located in Fort Worth, Texas, is a leading companion animal health company with product leaders in the dermatological and oral hygiene markets for pets and companion animals. Virbac provides a broad array of health care products to its customers under the brand names C.E.T.(R), ALLERDERM(R), IVERHART(TM) PLUS, Preventic(R) Plus, Pet-Tabs(R), St. JON(R), Mardel(R), Zema(R) and Francodex(R). For more information on Virbac, please visit www.virbac.com.

Delmarva Laboratories, located in Midlothian, Virginia, has been specializing in providing products for veterinary medicine, including pharmaceuticals and equipment since 1990. For information about their products, please visit www.delmarvalabs.com.

This press release contains forward-looking information made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be affected by certain risks and uncertainties described in the Company's filings with the Securities and Exchange Commission. Forward-looking statements regarding earnings per share depend in large part on the company's and its strategic partners' ability to launch new products effectively and customer acceptance of those products. The Company's actual results could differ materially from such forward-looking statements. Management believes that these amounts are fairly stated, but audited results could differ from these unaudited results and the effect may be material.