Horses or Habsburgs? State of the Thoroughbred Industry

Mary Finnegan
May 17 · 9 min read


When Eight Belles collapsed over two shattered ankles at the Kentucky Derby in 2008, few could process the scene. The image of a strapping young filly — the first to contest colts in nearly a decade — crumpled across the finish line cauterized itself in the public’s memory.

“She ran with the heart of a locomotive, on champagne-glass ankles,” wrote Sally Jenkins in a touching eulogy. “Thoroughbred racing is in a moral crisis, and everyone knows it.” Few could have predicted her death: at seventeen hands tall, she towered over most males, and Eight Belles easily cruised past the entire field, save the winner, Big Brown.

But fewer still could have predicted the impact of her death on the racing industry. The event would inspire a decade-long anti-doping movement that finally culminated in the passage of the Horse Racing Integrity and Safety Act of 2020 (HISA), the federal government’s most significant reform to horseracing in over four decades (ironically, Eight Belles’ autopsy revealed that she was the only clean horse running that day).

This week, as we await the first Preakness to be raced without Lasix in nearly a half-century, we take a look at some of the pivotal issues that have plagued the industry in recent years: doping, political fragmentation, and an ever-shrinking bloodline controlled by a few dozen prize stallion owners.

Returns from Stallion Syndication & Breeding

The big money in thoroughbreds has concentrated around breeding, rather than racing, since the 1970s. Investors discovered that returns from lucrative stud fees, broodmares, and yearling sales far outweighed any purse money that an individual horse could bring home from the track. Why pay $1.8 million for a filly when she has a less than 5% chance of breaking even from racing? Because even if she breaks down tomorrow, a healthy, well-pedigreed broodmare can produce valuable yearlings well into her 20s.

Stud stallions are even more of a cash cow. Early on, investors were attracted to stallion syndications, a co-ownership model that awarded each owner breeding rights in exchange for sharing maintenance costs and risks. Unlike broodmares, stud stallions need a few wins under their belt to attract initial offers. The first three to four years are pivotal for breeding volume: by the 4th season of mating, his children will start to reveal their racing talent (or lack thereof).

Take the case of Tapit, a so-so racehorse who only ran a total of six races. His stud fees started out at a paltry $15,000 in 2005. Luckily, his first crop of foals included a champion filly, immediately raising his fee. Tapit continuously produced winners — particularly of the Belmont Stakes — until he became the leading North American sire in 2014. “The versatility he has and everything else, I mean, you could subtract his turf earnings from his total … and he’d still be the leading sire,” said David Fiske, manager of Winchell Thoroughbreds, which campaigned Tapit and retains a 50% share in the stallion. “Turf runners are like a hobby for him.”

In 2015, his stud fee climbed to $300,000, and he commanded a booking of 164 mares per year. A single share of Tapit sold for $2.8 million, bringing his total value to around $140 million.

The Rise of the Sale Horse

The problem with increasing economic concentration in the breeding industry is that racehorses don’t race very much anymore. Horses are no longer bred to race: they’re bred to sell. The moment a crowd favorite wins enough races of significance, they are swept off the field into early retirement. Starts have fallen by 44%: the average number of starts per year for horses fell from 11.3 in 1960 to 6.15 in 2017. From a competitive standpoint, the sport is simply less interesting.

“It doesn’t take a genius to know that keeping the best-known horses in competition until they fully mature at five and six years old will create a fan following and enhance the sport’s popularity,” writes horse breeder and journalist Jim Squires. “But their owners are always in a hurry to retire them from racing, citing risk of injury and subsequent financial loss.”

Jess Jackson, the late owner-breeder of Stonestreet Farms, recalled how he shocked the racing establishment by bringing back Curlin, a champion three-year old in 2007, for another season. “When we decided to race Curlin as a 4-year-old, it astounded many in the industry that we would put aside a year’s breeding revenue of about 15 million dollars, an amount far greater than we could earn on the track, run the risk of loss or injury from racing and incur the multi-million dollar cost of insuring Curlin for racing,” said Jackson.

One side effect of commercial breeding is that most horses’ racing careers — if you can call four or five starts a “career” — begin and end in their juvenile years. “There is every incentive to compress horses’ racing careers, racing them too young and retiring them too soon, in order to get them to stud sooner and avoid the risk of breakdown,” said Jackson. “In practical terms, it means we are racing juvenile horses before their bones and joints are fully developed… Racing 2- and 3-year-olds can result in serious career ending injuries as witnessed on national TV with Barbaro, Eight Belles, and others.”

Overbreeding & Inbreeding

Another rising concern is the recent trend of overbreeding and inbreeding (among select stallions). Thoroughbreds were never a very diverse crowd to being with — part of their mythical history is that they all share a common bloodline from three foundation sires. Today, over ninety percent of Thoroughbreds can trace their lineage to one horse, the Darley Arabian, a stallion smuggled from the Syrian desert over three centuries ago.

It was once considered scandalous for a stallion to serve more than fifty mares a year. In the early 1980s, J.T. Lundy shocked his staid neighbors by breeding his prize stallion, Alydar, to nearly one hundred mares a year to finance lavish renovations to historic Calumet Farm. (Even this voracious breeding schedule proved insufficient to cover Lundy’s extravagances: he allegedly killed Alydar to collect on the $36 million insurance policy). Still, Lundy set a trend: today, many owners consider champion colts a cash printing machine that covers expenses while they invest in other bloodstock. Some may breed up to four times a day, topping 200 mares per year. Inbreeding also increases the odds of getting a sprinter, which sell better at yearling auctions.

The result is an ever-shrinking gene pool prone to fragility and unsoundness, not unlike the troubled Habsburg line of Germany. When Ellen Parker, a thoroughbred breeding consultant and analyst, watched Eight Belles load into the Derby gate, she said to her husband, “I just hope this filly doesn’t break down.” Eight Belles’ pedigree was littered with dangerous crosses that Parker blamed for many high-profile racetrack injuries and fatalities. While others were quick to crucify the trainer and jockey for her tragic death, Parker assigned blame to the breeder.

“Robert Clay is smart enough to know better,” said Parker. “He bred her. That’s where it starts… she was inbred three times to Raise a Native! [She broke down] right where Raise a Native was the weakest, right in the ankles, and everybody acts like they don’t know what caused this filly to break down. It’s written right there for everyone to see! Except they refuse to see it. To admit it is to address the fact that all these stallions that are bred like that, that all the yearlings that are bred like that, are potential accidents waiting to happen.”

By 2019, 7,415 mares (27% of the total) were bred to just 43 stallions. The Jockey Club — essentially the UN of horseracing — responded to the crisis of inbreeding by instituting a stallion cap of 140 mares per year. While the rule went into effect last year, three of the industry’s top breeders have challenged the legality of the rule in an anti-trust case, Spendthrift Stallions LLC v The Jockey Club, that is still in litigation.

Who Has the Best Veterinarian?

Breeding horses for looks and speed, rather than durability, has also handed undue power to veterinarians. As one Kentucky congressman cynically remarked, “The question used to be who had the best horse, but many people today say, who has the best veterinarian?” For years, many yearlings, once naturally leggy and knock-kneed, were fed a “pharmacopoeia” of enhancements to buff up their appearance because, as one trainer remarked, “fat is the best color in the world.”

The racing industry has proven itself unusually inept when it comes to dealing with drug abuse, in part because it has often condoned drug use (anabolic steroids were perfectly legal in many states as late as 2008). Alex Harthill, a legendary veterinarian who spent over five decades doping racehorses, first introduced racing to drugs in 1964. Many trainers coveted the favor of Harthill, who was known for engineering upsets. “Doc would have a shot of something in his coat, called it B-12 sometimes, and by the time I got my horse to the paddock he’d be jumping out of his skin,” said one former trainer. “Hell, every now and then we’d win by twelve.”

While Harthill was a renowned pharmacist, his drug of choice was Lasix, an anti-bleeder medication that was used by 95% of all starters until this year. “It started with me,” admitted Harthill. “I used it on Northern Dancer in 1964.” For decades, many regarded Lasix as a therapeutic medicine no different than Advil. It was supposed to prevent bleeding in horses’ lungs from intense exercise — a condition experienced by less than 10% of the racehorse population. But as a diuretic, Lasix caused horses to shed anywhere from 20–40 pounds pre-race, resulting in faster race times and an increased likelihood of winning.

Arthur Hancock, a fourth-generation horseman whose farm had produced three Kentucky Derby winners, lamented the unchecked influence of veterinarians on the field while testifying before Congress in 2008: “When I worked at the racetrack in 1966, the only time the veterinarian came to the barn was to check the horse on race day or if he was sick. Now, they are there every day, and veterinary bills for owners can run over $1,000.00 a month on a single horse. I told a veterinarian that I did not want my horses to get any medication unless they were sick and he replied, “You want to win races, don’t you Arthur?”

A Central Authority, At Last

Another difficulty with anti-doping enforcement lies in the structure of horseracing itself. Unlike every other professional or amateur sport, horseracing has no central league or commissioner to act as referee. Instead, it has 38 different states with 38 different sets of rules. “We are a rudderless ship, and the way we are going, we will all end up on the rocks,” said Hancock.

While HISA will not appoint a commissioner, it still hopes to lend some direction to the industry by creating the first uniform anti-doping rules overseen by the Federal Trade Commission and enforced by the United States Anti-Doping Agency, the same agency that regulates the Olympics and other elite athletes in the United States. The success of its enforcement will depend on out-of-competition testing and heightened penalties for drug violations.

Some argue that the vilification of certain drugs, like Lasix, is a mistake for the industry. They picture even worse PR nightmares, with horses collapsing on the track from blood loss or forced dehydration. But the rest of the global horse racing industry has long operated without Lasix, an anomaly only allowed in the US.

And many welcome the return to simpler days of old-fashioned hay, oats, and water. “We don’t need Lasix. We don’t need Bute. We don’t even need coffee,” said Hancock. “The horse can run … that magnificent animal lives to run. Just watch a young foal in the field about sundown when he is getting ready for bed. The last thing he does is run madly around the entire pasture.”

About Colbeck: Colbeck is a strategic lender that partners with companies during periods of transition, providing creative capital solutions to meet their evolving needs. You can reach the team at

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