Veterinary CRO and CDMO Market Analysis

Veterinary CRO and CDMO Market Analysis

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Based on the animal type, the market is categorized as companion animals and livestock animals. The companion animal segment is set to lead the market, accounting for the largest revenue of USD 3.8 billion in 2023, anticipating its dominance throughout the forecast period.
 

• Companion animals such as dogs and cats are considered family members in many households which is driving the need for advanced companion animal drugs. For instance, in 2024, approximately 66% of U.S. households with around 86.9 million are reported to own pets. Similarly, according to data from the UK Pet Food Manufacturers Association, an estimated 13.5 million dogs and 12.5 million cats are kept as pets. Thus, increasing pet ownership is expected to boost demand for new formulations.
   
• Therefore, CROs and CDMOs play a crucial role in supporting the development and manufacturing of innovative veterinary medicines and therapies to cater to the evolving needs of the companion animal market, which is a key driver of the overall veterinary outsourcing industry.
   

Based on service type, the veterinary CRO and CDMO market is classified into CRO services and CDMO services. The CDMO services segment holds the largest market share of 85.5% in 2023.
 

• Pharmaceutical and biotechnology companies increasingly rely on specialized CDMOs to manage essential aspects of the veterinary drug lifecycle. They offer expertise, technical capabilities, and economies of scale, providing end-to-end solutions from formulation development and manufacturing to commercial production and regulatory compliance. This allows veterinary companies to focus on core competencies, reduce costs, and bring products to market more efficiently.
   
• Moreover, the growing complexity of veterinary therapeutics and stringent regulations further drive demand for comprehensive CDMO services, making this segment dominant in the market.
   

Based on the product, the veterinary CRO and CDMO market is segmented into drugs, biologics, and medicated feed and supplements. The drugs segment is projected to reach USD 6.9 billion by end of 2032.
 

• The drugs segment dominance was asserted due to increasing demand for specialized services in drug development and manufacturing. Also, the increasing demand for innovative veterinary medicines to effectively address a variety of animal health issues is driven by advancements in biotechnology and the global growth of pet and livestock populations. Such aforementioned factor is expected to augment the segmental growth.
   

U.S. dominated the North American veterinary CRO and CDMO market, accounting for USD 2.2 billion in 2023 and is anticipated to show considerable growth over the analysis period.
 

• This dominance is driven by high pet ownership rates, and significant investment in R&D.  Also, high veterinary healthcare spending in the U.S. tends to further expand the market. For instance, according to the American Pet Products Association, in 2022, pet owners spent USD 31.5 billion on supplies, live animals, and medicine, and USD 35.9 billion on veterinary care and products. Thus, the increasing expenditure on veterinary care is driving the demand for effective treatment options.
   
• Furthermore, the country is known for significant investments in research and development, which promotes innovation and enhances the capabilities of veterinary services, thereby augmenting the country level market growth.
   

Germany exhibited a high growth potential in the European veterinary CRO and CDMO market.
 

• Germany holds prominence in the market owing to its advanced healthcare infrastructure and strong regulatory framework. The country's robust pharmaceutical industry and emphasis on research and development contribute significantly. For instance, Germany's biotechnology sector has been expanding, with increasing investments in veterinary medicine. This growth underscores Germany's pivotal role in providing high-quality CRO and CDMO services, catering to global demands for advanced animal health solutions efficiently.
   

The Asia Pacific veterinary CRO and CDMO market is poised for rapid growth with a CAGR of 9.1% during the forecast period.
 

• The region's large livestock industry especially in countries such as China, India, and Australia contribute to the growth of the market. The need for effective animal health solutions has increased the demand for outsourced R&D and manufacturing services.
   
• In addition, growing investment in veterinary healthcare coupled with advancements in biotechnology as well as growing focus on animal health are propelling the adoption of innovative treatments.
   
• Thus, these factors collectively position the Asia Pacific region poised to expand and explore opportunities in the market.