Since the USDA confirmed New World screwworm in a three-week-old calf in Zavala County, Texas, the containment operation has been underway — but the story has moved into a new phase: the scramble for treatment capacity and the market bets being placed on who profits if this gets worse.

Two Companies Are Sitting on FDA-Authorized Treatments

It's not just one company with an approved drug. There are two major players — and both saw their stocks pop the day the confirmation went public.

Zoetis holds FDA conditional approval for an injectable product that treats and prevents New World screwworm reinfestation in livestock. The FDA went further last month and issued emergency use authorization (EUA) for the drug to be sold over the counter. That's a significant expansion of access — no vet prescription needed.

Elanco Animal Health stepped up on June 4, 2026 with a formal commitment statement from CEO Jeff Simmons, announcing its portfolio of treatment options covers BOTH livestock AND pets. Elanco's products include Credelio Quattro-CA1 and Credelio for dogs, Credelio CAT for cats — all under FDA conditional approval or EUA — plus Negasunt Powder for livestock. According to Elanco's press release via PR Newswire, the company has over 70 years of screwworm experience from working in other parts of the world where the pest is endemic.

So the treatment infrastructure exists. The question is scale and speed.

What the Markets Are Saying

According to CNBC, Zoetis shares climbed nearly 4% and Elanco was up 2% in midday trading on the confirmation news. Options volume in Zoetis exploded to almost 20 times its daily average — nearly 12,000 contracts traded, overwhelmingly bullish.

One trader dropped nearly $700,000 buying Zoetis 80-strike calls expiring July 17, betting the stock moves another 5% higher by mid-July. Cattle futures, meanwhile, were up more than 1% — modest, but cattle prices are already up 50% from late 2024 lows, according to CNBC. Any supply disruption from a spreading screwworm outbreak compounds an already expensive beef market.

The Pandemic Risk Nobody Wants to Say Out Loud

Scott Gottlieb — former FDA Commissioner and current senior fellow at the American Enterprise Institute — put it bluntly via text to CNBC: "Screwworm is now circulating in tens of thousands of animals across Mexico. If cases start clustering, or we see detection in wildlife like white-tailed deer, the odds of holding this at the border drop sharply. The biggest vulnerability is the next 18-24 months."

White-tailed deer pose the real challenge. There are an estimated 30 million white-tailed deer in the United States. They don't respect quarantine zones. They don't get treated. And they move constantly across millions of acres of land that no government agency can monitor.

The USDA's current response — a 20-kilometer infested zone, quarantines, movement controls, and surveillance — works fine for a contained livestock situation. It does NOT work if screwworm gets into wild deer populations. That's the scenario that turns a Texas ranch problem into a national catastrophe.

The Regulatory Gap

This pest was eradicated from the U.S. in 1966. Keeping it out required decades of sustained effort using sterile insect technique — releasing billions of sterile male flies to suppress reproduction. That program costs money and coordination. It's been running along the southern border as a firewall. The fact that one case got through to Zavala County means the firewall is under pressure.

According to CNBC, the FDA only granted conditional approval to Merck Animal Health's topical solution Exzolt Cattle-CA1 in December — barely six months ago. Elanco's and Zoetis's products also carry conditional or emergency approvals, NOT full approvals. These are wartime authorizations. The regulatory infrastructure is being built on the fly.

The threat is NOT just cattle. According to Elanco's official statement, New World screwworm larvae can infest any warm-blooded animal — including humans. That detail appeared in a press release and barely made it into any headline.

Price and Supply Implications

Beef is already expensive. If screwworm establishes itself in Texas livestock or — worse — jumps to wildlife, supply gets squeezed further. Ben Rand, Nebraska-based broker for Blue Line Futures, told CNBC: "The No. 1 preferred commodity in the U.S. is beef — Americans love their fast food so if you have any issue with the beef supply chain, it'll have some market volatility."

Pet owners should also pay attention. Elanco specifically flagged dogs and cats as vulnerable. If you live in southern Texas or travel that region with animals, this is relevant to you right now.

The USDA and Dudley Hoskins, undersecretary for marketing and regulatory programs, say they've been preparing since cases started rising in Central America and Mexico. The tools exist. The containment operation is active.

But Gottlieb's 18-24 month warning is the number that matters. That's the window to hold the line. If it slips, this becomes a very different — and very expensive — story.