American Vanguard Withdraws Dacthal Registration
American Vanguard (NYSE: AVD) has announced the voluntary cancellation of all federal registrations for its Dacthal herbicide products. This decision follows an emergency suspension order issued by the EPA on August 6, 2024. The company is working with state and federal authorities to remove Dacthal from distribution channels and plans to cancel all international registrations as well.
The EPA's suspension was based on a single rodent study provided by AVD two years ago, which showed potential fetal effects at certain doses. The company had been working with the EPA to identify risk mitigation measures and discuss additional studies, but ultimately decided to withdraw the product registrations.
American Vanguard (NYSE: AVD) ha annunciato la cancellazione volontaria di tutte le registrazioni federali per i suoi prodotti erbicidi Dacthal. Questa decisione è stata presa dopo un ordine di sospensione d'emergenza emesso dall'EPA il 6 agosto 2024. L'azienda sta collaborando con le autorità statali e federali per rimuovere Dacthal dai canali di distribuzione e intende annullare anche tutte le registrazioni internazionali.
La sospensione dell'EPA si basava su uno studio su roditori fornito da AVD due anni fa, che mostrava potenziali effetti fetali a determinate dosi. L'azienda stava lavorando con l'EPA per identificare misure di mitigazione del rischio e discutere studi aggiuntivi, ma alla fine ha deciso di ritirare le registrazioni del prodotto.
American Vanguard (NYSE: AVD) ha anunciado la cancelación voluntaria de todas las registraciones federales para sus productos herbicidas Dacthal. Esta decisión sigue a una orden de suspensión de emergencia emitida por la EPA el 6 de agosto de 2024. La empresa está trabajando con las autoridades estatales y federales para eliminar Dacthal de los canales de distribución y planea cancelar también todas las registraciones internacionales.
La suspensión de la EPA se basó en un estudio con roedores proporcionado por AVD hace dos años, que mostró posibles efectos fetales a ciertas dosis. La empresa había estado trabajando con la EPA para identificar medidas de mitigación de riesgos y discutir estudios adicionales, pero finalmente decidió retirar las registraciones del producto.
아메리칸 바뉴어드 (NYSE: AVD)는 자사의 Dacthal 제초제 제품에 대한 모든 연방 등록을 자발적으로 취소한다고 발표했습니다. 이 결정은 2024년 8월 6일 EPA에서 발행된 긴급 중단 명령에 따른 것입니다. 회사는 주 정부 및 연방 당국과 협력하여 Dacthal을 유통 경로에서 제거하고 모든 국제 등록도 취소할 계획입니다.
EPA의 중단은 AVD가 2년 전에 제공한 단일 설치류 연구에 기반한 것이며, 특정 용량에서 잠재적인 태아 영향을 보여주었습니다. 회사는 위험 완화 조치를 식별하고 추가 연구에 대해 논의하기 위해 EPA와 협력해 왔으나, 결국 제품 등록을 철회하기로 결정했습니다.
American Vanguard (NYSE: AVD) a annoncé l'annulation volontaire de toutes les enregistrements fédéraux de ses produits herbicides Dacthal. Cette décision fait suite à un ordre de suspension d'urgence émis par l'EPA le 6 août 2024. L'entreprise collabore avec les autorités étatiques et fédérales pour retirer Dacthal des canaux de distribution et envisage également d'annuler tous les enregistrements internationaux.
La suspension de l'EPA était basée sur une étude unique sur des rongeurs fournie par AVD il y a deux ans, qui a montré des effets fœtaux potentiels à certaines doses. L'entreprise avait travaillé avec l'EPA pour identifier des mesures de réduction des risques et discuter d'études supplémentaires, mais a finalement décidé de retirer les enregistrements des produits.
American Vanguard (NYSE: AVD) hat die freiwillige Stornierung aller bundesstaatlichen Registrierungen für seine Dacthal-Herbizidprodukte angekündigt. Diese Entscheidung folgt auf eine Notfallsperranordnung, die von der EPA am 6. August 2024 erlassen wurde. Das Unternehmen arbeitet mit staatlichen und bundesstaatlichen Behörden zusammen, um Dacthal aus den Vertriebskanälen zu entfernen, und plant auch die Stornierung aller internationalen Registrierungen.
Die Sperrung durch die EPA basierte auf einer einzelnen Studien zu Nagetieren, die AVD vor zwei Jahren vorgelegt hatte und potenzielle fetale Auswirkungen bei bestimmten Dosen zeigte. Das Unternehmen hatte mit der EPA daran gearbeitet, Risikominderungsmaßnahmen zu identifizieren und weitere Studien zu besprechen, entschied sich jedoch letztendlich, die Produktregistrierungen zurückzuziehen.
- Proactive approach to product stewardship by voluntarily cancelling registrations
- Cooperation with regulatory authorities for product removal and distribution channel clearance
- Loss of Dacthal herbicide product line from AVD's portfolio
- Potential impact on revenue due to product withdrawal
- Suspension of product sales since April 2024
- Inability to implement risk mitigation measures to satisfy EPA concerns
Insights
American Vanguard's decision to withdraw Dacthal registrations globally is a significant development with potential financial implications. While the immediate impact on revenue might be due to the product's suspended status, the long-term effects could be more substantial. The company's proactive approach in voluntarily canceling registrations may help mitigate regulatory risks and potential legal liabilities.
Investors should consider the following:
- Potential impact on revenue and market share in the herbicide segment
- Costs associated with product returns and removal from distribution channels
- Possible reallocation of R&D resources to develop alternative products
- Enhanced focus on other product lines to offset any revenue loss
The company's commitment to international product stewardship could potentially strengthen its reputation in the long run, which may partially offset the negative impact of this product withdrawal.
The withdrawal of Dacthal registrations highlights the evolving landscape of environmental regulations and their impact on the agrochemical industry. This case demonstrates the precautionary principle in action, where potential risks to human health are prioritized over immediate economic considerations.
Key takeaways:
- EPA's decision based on a single rodent study underscores the agency's low risk tolerance for potential developmental effects
- The suspension order issued to prevent potential harm, rather than in response to actual reported harm, signals a proactive regulatory approach
- American Vanguard's voluntary cancellation of international registrations suggests a global shift towards stricter environmental standards
This development may prompt other agrochemical companies to reassess their product portfolios and invest more heavily in developing environmentally friendly alternatives to maintain market competitiveness.
The withdrawal of Dacthal, a herbicide used in various crops, could have ripple effects across the agricultural sector. Farmers who relied on this product may need to seek alternatives, potentially impacting crop yields and production costs in the short term.
Industry implications:
- Market opportunity for competing herbicide manufacturers to fill the gap left by Dacthal
- Increased demand for alternative weed control methods, including mechanical and biological solutions
- Potential for accelerated innovation in developing safer, more environmentally friendly herbicides
- Heightened scrutiny of other herbicides, possibly leading to further regulatory actions industry-wide
This situation underscores the importance of diversification for agrochemical companies and the need for continuous investment in R&D to stay ahead of evolving regulatory standards and market demands.
Product Was Suspended by EPA Based on One Rodent Study
In connection with its action, the Company made the following statements.
While the Company continues to question EPA’s conclusions in support of the suspension, we believe that the best course of action is to voluntarily cancel registrations of this product. We are working apace with both state and federal authorities to effect product return and to remove Dacthal from channels of distribution. It is the Company’s position that product stewardship be international in scope; thus, we will now proceed to voluntarily cancel all international registrations as well.
It is important to note that EPA’s findings are based upon the test results of a single, relatively new study that the Company had provided to the agency over two years ago which showed an effect on fetal rodents at certain dose levels. As is typically the case with such studies, the observed effect was extrapolated to indicate a potential effect upon human beings. The suspension order, then, was issued by EPA on the premise of preventing potential harm, rather than in response to an actual, reported harm. The Company had been working with the EPA in good faith for over one year to identify risk mitigation measures that might alleviate concerns and allow continued use of high-benefit use patterns. However, these measures apparently did not give the EPA sufficient certainty at the time. The Company was also discussing with the EPA the potential for completion of additional toxicology and exposure studies that may have alleviated risk concerns, had they been afforded time to proceed. The Company nevertheless thanks EPA for expending time and resources to consider and evaluate the many proposed risk mitigation measures.
About American Vanguard
American Vanguard Corporation is a diversified specialty and agricultural products company that develops and markets products for crop protection and management, turf and ornamentals management and public and animal health. Over the past 20 years, through product and business acquisitions, the Company has expanded its operations into 21 countries and now has over 1,000 product registrations in 56 nations worldwide. Its strategy rests on three growth initiatives – i) Core Business (through innovation of conventional products), ii) Green Solutions (with over 120 biorational products – including fertilizers, microbials, nutritionals and non-conventional products) and iii) Precision Agriculture innovation. American Vanguard is included on the Russell 2000® and Russell 3000® Indexes. To learn more about American Vanguard, please reference the Company’s web site at www.american-vanguard.com.
The Company, from time to time, may discuss forward-looking information. Except for the historical information contained in this release, all forward-looking statements are estimates by the Company’s management and are subject to various risks and uncertainties that may cause results to differ from management’s current expectations. Such factors include weather conditions, changes in regulatory policy and other risks as detailed from time-to-time in the Company’s SEC reports and filings. All forward-looking statements, if any, in this release represent the Company’s judgment as of the date of this release.
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Company Contact:
American Vanguard Corporation
Anthony Young, Director of Investor Relations
(949) 260-1200
anthonyy@amvac-chemical.com
Investor Representative:
The Equity Group Inc.
www.theequitygroup.com
Lena Cati
Lcati@equityny.com
Source: American Vanguard Corporation
FAQ
Why did American Vanguard (AVD) withdraw Dacthal registrations?
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