Did you know that over seventy percent of all antibiotics and antimicrobial drugs in this country are fed to farm animals for non-therapeutic purposes? Further, did you realize that many scientific studies confirm that the non-therapeutic use of antibiotics in agricultural animals contributes to the development of antibiotic-resistant bacterial infections in people? If you have pharmaceutical stock holdings in your portfolio and you don't know about H.R. 1549, perhaps – for your health and the health of your portfolio – you might take a look at what's going down on the ranch.

H.R. 1549 [PDF], or the Preservation of Antibiotics for Medical Treatment Act of 2009, was developed by the 11th Congress in its first session (17 March 2009) to preserve the seven most effective classes of antibiotics for human use only. The antibiotics in question include penicillin, tetracycline, macrolide, lincosamide, streptogramin, aminoglycoside and sulfonamide. To be on the safe side, “any other drug or derivative of a drug that is used in humans or intended for use in humans to treat or prevent disease or infection caused by microorganisms” also can be included.

These drugs are used to treat some pretty serious infections and diseases in people, such as pneumonia, scarlet fever, rheumatic fever, venereal disease, skin infections, and pandemics like malaria and plague, as well as bioterrorism agents like smallpox and anthrax. They also are used to treat the same issues in animals; but, before you join some animal rights group over this “injustice” to animals, you can rest assured that antibiotics may still be used to treat sick animals, but they can't be used to simply raise animals.

If you weren't raised on a farm or if you didn't read some scorchers this summer such as the book, Food, Inc., you may not realize that farmers, ranchers and breeders use antibiotics for growth promotion and for compensation for crowded, unsanitary and stressful farming and transportation conditions. While vegetarians may stress that you stop eating meat, the point is that vegetarians are as much at risk for becoming resistant to antibiotics as meat eaters. Here's why (taken from H.R. 1549):

• Large voluntary surveys by the Department of Agriculture's Animal and Plant Health Inspection Service in 1999, 2001, and 2006 revealed that 84 percent of grower-finisher swine farms, 83 percent of cattle feedlots, and 84 percent of sheep farms administer antimicrobials in the feed or water for health or growth promotion reasons only.
  
  
• The United States Geological Survey reported in March 2002 that: (A) antibiotics were present in 48 percent of the streams tested nationwide; and, (B) almost half of the tested streams were downstream from agricultural operations.
  
  
• An April 1999 study by the General Accounting Office concluded that resistant strains of 3 microorganisms that cause food-borne illness or disease in humans - Salmonella, Campylobacter, and E.coli - are linked to the use of antibiotics in animals.
  
  
• Epidemiological research has shown that resistant Salmonella and Campylobacter infections are associated with increased numbers of ill patients and bloodstream infections, and increased death.
  
  
• In January 2003, Consumer Reports published test results on poultry products bought in grocery stores nationwide showing disturbingly high levels of Campylobacter and Salmonella bacteria that were resistant to antibiotics used to treat food-borne illnesses.
  
  
• The Food and Drug Administration’s National Antimicrobial Resistance Monitoring System routinely finds that retail meat products are contaminated with bacteria resistant to antibiotics important in human medicine including the food-borne pathogens Campylobacter and Salmonella.
  
  
• In December 2007, the USDA issued a fact sheet on the recently recognized link between antimicrobial drug use in animals and the Methicillin Resistant Staphylococcus aureas (MRSA) infections in humans.
  
  
• In October 2001, the New England Journal of Medicine published an editorial urging a ban on non-therapeutic use of medically important antibiotics in animals.
  
  
• In 1998, the National Academy of Sciences noted that antibiotic-resistant bacteria generate a minimum of $4,000,000,000 to $5,000,000,000 (that would be billions of dollars) in costs to United States society and individuals yearly.

There is one notable exception to these arguments, despite seemingly overwhelming evidence in favor of withdrawing the use of antibiotics for animals for anything other than illness: “the applicant has failed to demonstrate that there is a reasonable certainty of no harm to human health due to the development of antimicrobial resistance that is attributable, in whole or in part, to the non-therapeutic use of the drug.”

While a study to determine whether non-therapeutic use of the drug on animals is harmful to humans is in the planning stages, it appears that the withdrawal of these drugs for anything other than illness in humans and in animals seems imminent with this amendment.

I hope I have provided enough information to stoke your curiosity. You might look to the Centers for Disease Control (CDC) to learn more about MRSA and other diseases mentioned above and to learn how these diseases have become more difficult to treat. MRSA, for instance, is resistant to certain antibiotics. On that note, when you read the fifteen pages contained in H.R. 1549, you'll learn that another argument for passage of this amendment includes the issue of national security, because resistance to antibiotics could, presumably, make this country vulnerable to biological attacks.

So, if you carry pharmaceutical holdings in your portfolio, you might look closely at those stocks to determine how much of their value is allotted to antibiotics and  antimicrobial drugs. These stocks may feel the pinch  if up to seventy percent of the demand for those drugs drops. On the other hand, you may learn that many pharmaceutical companies are well diversified and this motion may not hurt them in the slightest. The hurt may run deep, however, at the feed lot.

As an afterthought, you might read the last paragraph in a Washington Post article about this bill and compare those thoughts to ones I developed when I read the book, Exposed (see “Is Your Stock Greenwashing You?”). It appears that any investor should keep an eye on EU policies as well as those created – or not created – in the U.S. for the next few years for comparison...the disparity in health and environmental policies between the two political regions could affect more than antibiotics and beef. It could affect your portfolio.

Until Later,