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West L.A pet hospital caters to high-end clients

The huge VCA West L.A. hospital offers bone-marrow transplants for dogs as well as radiation therapy, acupuncture and hydrotherapy. Revenue of parent firm VCA Antech is up despite declining U.S. pet ownership.

November 12, 2013|By Stuart Pfeifer

All the amenities of modern medicine are available at a new West Los Angeles hospital. There's 24-hour emergency care, a team of surgeons, psychology and physical therapy units, MRI and CT machines, one of the top oncologists in the country.

Medical assistants busily roam the halls, soothing patients' fears with smiles, kind words or gentle touches. But they have to watch out: The patients can bite.

They're dogs, cats and other pets being treated at the VCA West Los Angeles Animal Hospital, which at 42,000 square feet is the largest pet hospital west of the Mississippi River.

It is one of only a handful of U.S. animal hospitals that offer such sophisticated procedures as bone-marrow transplants for dogs — at a startling $16,000 — as well as radiation therapy, acupuncture treatment and hydrotherapy pools.

"I'll be honest with you, this is nicer than a lot of human hospitals I've been in," said Richard Finn, who drove from his Dallas home to have his dog, Jason, undergo a bone-marrow transplant. "For the money I'm spending, I'm happy to see it's a nice facility."

VCA Antech Inc., which owns more than 600 pet hospitals in North America, opened the facility near its headquarters in February. The hospital already has attracted an elite clientele that includes the Los Angeles Zoo, which has rushed hyenas and orangutans in for emergency treatment.

VCA opened the huge facility even as the industry continued to feel the effects of the Great Recession and the weak recovery. Many pet owners have delayed treatment for their pets or skipped it altogether.

Moreover, the number of pets in the United States declined from 2006 to 2011 — ownership of dogs fell 2% and that of cats 6% — according to a study by the American Veterinary Medical Assn.

Even so, VCA reported record third-quarter sales of $464.1 million, a 7% gain over last year's third quarter, largely by acquiring smaller, independent operations. Revenue at operations open for the last 12 months, though, rose only 1.1%.

Art Antin, VCA's co-founder and chief operating officer, said that opening the three-story facility during sluggish times for the industry made sense for several reasons.

VCA was able to consolidate two smaller nearby hospitals into the new flagship on Sepulveda Boulevard. And the comprehensive care it offered gave the company a strong lure to attract some of the best veterinarians in the country, Antin said.

"The more you give to the clients in ways to care for their pets, the more experienced doctors want to work at the hospital," he said. "It's no different than human medicine: If you have a top-notch hospital, you attract the best doctors."

He wouldn't disclose the cost of renovating the leased building, which had long housed the Automobile Club of Southern California, but estimated it would generate $22 million to $25 million a year in revenue.

Kevin Ellich, a research analyst at investment firm Piper Jaffray, said he believes VCA was wise to invest in a premier hospital, even amid the industry's slowdown. He said the animal healthcare business is improving, with pet owners more willing to spend than they were during the recession.

He recommends buying the stock.

"Having a flagship showcase like that, I don't think there's anything wrong with that, especially when you're trying to recruit new veterinarians to come work for you," Ellich said.

Finn was so impressed with the hospital that he traveled nearly 1,500 miles last spring for the surgery on his dog, a Welsh corgi diagnosed with lymphoma this year.

By the time he loaded Jason into his Lexus and made the drive back to Texas, Finn's bills had reached $30,000. That included payments to a local vet, travel costs and the $16,000 he paid VCA.

For Finn, financially secure at 25 thanks to a trust fund, the decision was easy.

"My animals are an integral part of my life because I am at home so much," he said. "My animals are not disposable; they're my children."

The hospital, though, has critics among its customers.

Amy Chang, a 34-year-old Westwood resident, said she was impressed the first time she stepped inside the hospital.

"When you enter VCA hospital, it's like entering the lobby of a swanky hotel," Chang said.

Her feelings soured after a doctor examined her cat, which had been vomiting. The doctor said her cat probably had cancer and needed several tests, a diagnosis that didn't seem right to her.

"He definitely played on our emotions," Chang said. "He said he has cancer and you only have a few months, not years. At that point I started crying."

She said she was required to pay a bill of about $1,200 before the staff would return her cat so she could leave.

A veterinarian elsewhere diagnosed the cat with a food allergy, not cancer, she said. After changing the brand of food, the vomiting stopped. Six months later, Chang is still furious.

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