The Veterinary Active Pharmaceutical Ingredient Market is expected to record a CAGR of 7.2% from 2023 to 2030, reaching $13.67 billion by 2030. Veterinary active pharmaceutical ingredients (APIs) are integral to the veterinary healthcare industry as they are needed to manufacture finished medicines or formulations to treat and prevent diseases and disorders in animals. The growth of the veterinary pharmaceutical ingredients market is driven by the growing expenditure on animal health, the rising prevalence of animal, foodborne, and zoonotic diseases, and the growing demand for animal-derived food products globally. Additionally, increasing awareness regarding animal health in emerging economies and the growing application of precision medicine in veterinary care are expected to create growth opportunities for the stakeholders in this market. However, the stringent regulatory approval process restrains the growth of this market. The environmental impact of veterinary drugs and the dearth of veterinary practitioners is a major challenge to market growth.

Growing Demand for Animal-derived Food Products to Drive the Market

The demand for animal-derived food products, namely meat, milk, and eggs, has increased. The consumption of animal-derived foods is increasing due to decreasing agricultural productivity due to shrinking resources and reduced availability of cultivable land. Foods derived from animals are a major source of protein, and a protein-rich diet is essential to leading a healthy life.

Consumption of animal proteins is stable (around 44 to 55 g/capita/day) in developed countries, while consumption is increasing in developing countries. For instance, in 2020, the U.S. accounted for approximately 21% of global beef consumption. In 2020, beef and veal consumption in Asia reached 19,656.46 thousand tons and is expected to increase to 21,467.08 thousand tons by 2026 (Source: OECD FAO). Farmers are expected to increase livestock production to meet the increasing demand for animal-derived foods. Increased livestock production will encourage the adoption of pharmaceuticals for animals. Several medications are used for animals for their overall health, such as vaccines, parasiticides to treat parasitic infections, and medicines for other diseases and conditions to prevent the spread of disease and improve animal health. This is one of the major factors driving the market growth.

Growing Prevalence of Animal, Foodborne & Zoonotic Diseases Drives the Market Growth

The increasing number of livestock/farm animals poses a higher risk of diseases and infections that can cross the species barrier and be passed on to humans through direct contact or the consumption of livestock products. Over the last century, there has been an alarming increase in the number, frequency, and diversity of zoonotic disease outbreaks. Caused by the spillover of pathogens from animal hosts to people, these events may have more than tripled in the last decade, with the number of new zoonotic diseases infecting people quadrupling over the same period.

Over 150 zoonotic diseases can be transmitted to humans by wild and domestic animal populations, 13 of which are responsible for 2.2 million deaths per year. Zoonotic diseases are caused by viruses, bacteria, parasites, and fungi. These germs can cause many illnesses in people and animals, ranging from mild to serious illnesses and even death. Depending on the disease, animals can sometimes appear healthy, even when carrying pathogens that can make people sick.           

Furthermore, although pet animals are considered a part of the family, they can be carriers of diseases that infect humans. Diseases transmitted from animals to humans mainly spread through vectors, such as flies, ticks, fleas, and mosquitoes. Therefore, pet owners are growing increasingly concerned regarding the health and well-being of their companion animals, driving the adoption of medicines and drugs required for their well-being. Therefore, the growing prevalence of diseases in animals and the high risk of zoonotic diseases leads to adopting appropriate medicines and drugs to curb the spread of these diseases. This is expected to generate a demand for veterinary APIs for manufacturing these drugs, driving the market globally.

Key Findings of the Veterinary Active Pharmaceutical Ingredient Market Study:

The Parasiticides Segment to Dominate the Veterinary Active Pharmaceutical Ingredients Market in 2023

Parasiticides such as ectoparasiticides, endoparasiticides, and endectocides are used against the infections of parasitic organisms, including tapeworms, hookworms, roundworms, mites, fleas, ticks, flukes, and other parasites. Companion animals, as well as farm animals, are very commonly affected by these parasites. Therefore, it becomes crucial to administer the parasiticides at regular intervals to keep the animal healthy and disease-free, supporting a large share of the segment. Moreover, factors such as the increasing prevalence of zoonotic diseases, growing demand for animal-derived food products, and increasing number of livestock in emerging economies also support the large share of the segment.

The Chemical APIs Segment to Account for the Largest Market Share in 2023

The factors attributed to the segment’s large share are control & precision, scale-up, cost efficiency, and consistency. Chemical synthesis methods can be efficient and cost-effective for producing large quantities of APIs. Once the route for the synthesis of a compound is set, the manufacturers can scale up the production process, which helps the manufacturers reduce the production costs, leading to higher profit margins. This cannot be achieved for biologically synthesized APIs as they require specific methodologies and techniques to obtain the desired molecule.

The Companion Animals Segment is Expected to Dominate this Market in 2023

Based on animal type, the veterinary active pharmaceutical ingredients market is segmented into companion animals and livestock. In 2023, the companion animals segment is expected to account for the largest share of the animal parasiticides market. People need a companion for emotional well-being, and pets offer a positive environment at home. There is a common trend of owning a pet amongst people globally. According to Animal Medicines Australia, pet ownership in Australia increased to 69% of households having pets in 2021 from 61% in 2019. This increase led to a rise in pet-related expenditures & adoption of pet insurance in Australia. For instance, the average household insurance expenditure for dogs in Australia increased from USD 147 in 2019 to USD 246 in 2021.

Asia-Pacific to Be the Fastest-Growing Regional Market

In 2023, North America is expected to dominate the veterinary active pharmaceutical ingredient market, while Asia-Pacific is expected to record the highest CAGR during the forecast period. The high growth of the Asia-Pacific veterinary active pharmaceutical ingredient market is attributed to the growing population of pet animals, growing demand and consumption of animal-derived food proteins, presence of large exporters of animal products, government initiatives to improve agricultural and animal husbandry outcomes, and the rising incidence of various zoonotic diseases in the region.

Key Players

The report offers a competitive landscape based on an extensive assessment of the product portfolio offerings, geographic presence, and key strategic developments adopted by leading market players in the last three to four years. The key players profiled in the veterinary active pharmaceutical ingredient market are Alivira Animal Health Limited (India), Excel Industries Ltd. (India), Suan Farma, S.A.U. (Spain), Chr. Olesen (Denmark), Qilu Pharmaceutical Co., Ltd. (China), FIS - Fabbrica Italiana Sintetici S.p.A. (Italy), Rochem International Inc. (U.S.), NGL Fine-Chem Ltd. (India), MENADIONA S.L (Spain), and Chempro Pharma Private Limited. (India).

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