The truth about cats and dogs is that you mere humans love them, excessively so. About 70 percent of you consider them on par with children and you’ll spend something like $18 billion annually on veterinary care to ensure their health is at least as sound as your kids’. Guilty? If so, chances are good that you’re helping to fuel the growth of a manufacturer that has been quietly operating on Des Moines’ Southeast Side for more than 50 years.

Heska Corp., located at 2538 S.E. 42nd St. in the heart of the city’s developing Agrimergent Technology Park, traces its Des Moines beginnings back to 1952 when a consortium of veterinarians who were dissatisfied with the pharmaceuticals available for use in their farm production animal practices began developing new products under the Diamond Labs label.

The veterinarians’ company disappeared in a flurry of acquisitions and mergers from 1972 to 1996, but the Diamond brand has endured. Loveland, Colo.-based Heska, a leader in the development of pharmaceuticals, diagnostic equipment and other health-care supplies for companion animals, acquired Diamond Animal Health in 1996 and has maintained it as a wholly owned subsidiary. Intent on maximizing use of the 168,000-square-foot campus, the new owners gave Diamond Animal Health the go-ahead to continue developing and manufacturing new products under the Diamond name, but did not commit Heska’s financial resources.

“We’ve grown that portion of the business as Heska has grown,” said Michael J. McGinley, a microbiologist who is Heska’s vice president of operations and technical affairs, as well as the Des Moines plant’s general manager.

Heska’s growth, though, is firmly anchored in the core companion animal health product market, which as an industry sector has grown by more than $1 billion since 1993. Heska’s own evolution has followed that curve, and its product revenues in that sector grew 22.9 percent from 1998 to 2004. The publicly traded company’s 2005 earnings won’t be announced until a March 27 conference call, but its 2004 product revenues were $65.7 million, $52.7 million of which came from the sale of pet health-care products to veterinarians. That compares with $64 million in product revenues in 2003, $47.6 million of it from the pet health-care market.

The company isn’t content to merely compete against industry giants like Bayer, Novartis, Pfizer, Wyeth and others, but to lead through innovation. As of Aug. 31, the company had been issued 204 U.S. patents for its products.

“Heska’s mission early on was to look at novel ways of delivering vaccines,” McGinley said, citing the example of vaccines for cats and dogs that are delivered through a nasal mist rather than injection.

“We found the market was adequately served by the regular route – the needle – but some wanted another method,” he said. “Like any new product, we’re in the midst of building loyalty.”

Heska sells its products directly to veterinarians, targeting 35,000 of them working in approximately 18,000 clinics in the United States. The company’s research indicates that between $3 billion and $4 billion is spent annually on products for veterinary use, about half of that market in the United States.

McGinley said veterinarians have been able to lower their own costs of doing business by using the company’s wide range of diagnostic equipment – from simple strip tests that work like at-home pregnancy tests to determine if cats and dogs have heartworm to laboratory equipment such as its CBC Hematology Analyzer or SpotChem Blood Chemistry system – instead of contracting with outside labs for diagnostic tests. They’re also able to better serve their clients because they can provide results in minutes instead of days.

With 69 million cats and 62 million dogs in the United States and consumer spending with veterinarians showing no signs of slowing down, Heska officials see a lot of blue sky ahead.

Heska is the type of business Des Moines economic development officials are eager to not only hold on to, but also nurture by surrounding it with other agribusinesses focused on biotechnology and other related industries, said Ellen Walkowiak, an economic development coordinator for the city of Des Moines. Heska is one of the anchor businesses in the Agrimergent Technology Park, an agribusiness park that figures to revitalize the city’s Southeast Side. When the park, which will eventually will encompass 1,100 acres, is fully developed, city officials anticipate 6,500 new jobs will have been created and the tax bas in the area will have been increased by about $420.4 million.

Heska is one of the park’s anchors, along with Tennessee-based Helena Chemical Co., which operates a manufacturing facility there, and agricultural giant Cargill Inc., which began as a small country elevator in Conover in 1865. The three anchors are not direct competitors, but each is involved in value-added agriculture and biotechnology. One of the city’s goals in the development of the business park, Walkowiak said, is to “create a neighborhood of like businesses that help to reinforce each other’s successes.”

“The kind of business Heska is involved in is what we hope to attract to the park,” said Walkowiak, who credited McGinley as one of the driving forces behind Agrimergent Park’s success to date. “The energy and enthusiasm and foresight that Mike McGinley and his colleagues have is really what this park is all about.”

Heska employs 106 people in Des Moines, where the production facility is licensed by both the U.S. Department of Agriculture and the U.S. Food and Drug Administration. About half of the Des Moines employees are involved in research and development and manufacturing, 20 percent are involved in regulatory matters, 10 percent in quality control and 20 percent in administration and finance. Many of the positions require advanced degrees, according to McGinley, who holds a Ph.D. in microbiology

He says the company still has plenty of room for growth in Des Moines and the Agrimergent Park helps stimulate that. “We’re sitting out here with a lot of space, a lot of capacity and a lot of pilot-level product capacity,” he said. “This could be Iowa’s Silicon Valley opportunity.”