Animal Drug Compounding Market Size, Share, and Growth Forecast from 2025 - 2032

Animal Drug Compounding Market Size and Share Analysis

The global animal drug compounding market is to reach a value of US$ 1.4 Bn by 2025. It is anticipated to experience a CAGR of 6.6% during the forecast period to reach a size of US$ 2.2 Bn by 2032. Continuous trends in pet humanization are estimated to drive the demand for customized medications that cater to specific animal health requirements, similar to human pharmaceuticals.

Pet ownership in urban areas is estimated to rise by 20% across the globe by 2030. Artificial intelligence is predicted to streamline drug formulation processes, allowing pharmacies to create precise and efficient compounded medications.

Automation is predicted to decrease production time by 20% to 40% while improving accuracy, making customized rugs more affordable. Virtual veterinary consultations are further estimated to drive the demand for compounded medication tailored to remote diagnostics.

Key Highlights of the Industry

• Rising penetration of pet insurance is likely to ease the financial burden on owner, thereby making premium veterinary care, including compounded drugs more accessible.
• Customized treatments for livestock health and productivity is estimated to grow especially in regions where sustainable agricultural practices are emphasized.
• As regulatory frameworks continue to evolve to support quality assurance and transparency, thereby encouraging market entry by larger pharmaceutical companies.
• Consumer demand for eco-friendly and sustainable products is likely to influence drug compounding practices.
• Increasing focus on treating rare and chronic conditions in animals is expected to drive the demand for niche compounded medications.
• As veterinary clinics, universities, and pharmaceutical companies continue to collaborate, innovations are expected in compounding techniques and formulations.
• By product, the CNS agents segment is anticipated to account for a market share of 35% in 2024 due to rising prevalence of behavioural disorders in pets.
• In terms of formulation, the oral category is estimated to hold a share of 55% in 2024 owing to ease of administration.
• Based on animal, the livestock category is projected to account for a share of 54.4% in 2024 owing to their massive presence.
• Animal drug compounding market in North America is set to showcase a CAGR of 8.1% through 2032 owing to the huge pet population in the region.

Presence of Huge Pet Population in North America to Fuel Sales

North America animal drug compounding market is estimated to lead the global industry with an estimated share of 42% in 2024. The region has one of the highest pet ownership rates across the globe, thereby creating a large and consistent demand for veterinary services and medications.

As of 2023, over 70% of U.S. households owned pets while pet ownership in Canada also witnessed an increase with 60% of households owning pets in 2022. North America has a significant population of exotic pets that often require custom-compounded medications that are commercially unavailable.

The region boasts a highly developed veterinary sector with widespread access to clinics, hospitals, and diagnostic facilities. The U.S. Food and Drug Administration (FDA) provides specific guidelines for compounding animal drugs like GFI #256 that has set clear standards for pharmacies while ensuring safety and quality.

Rising Awareness Campaigns to Boost Demand for CNS Agents

CNS agents are estimated to lead the product category with a share of 35% in 2024 owing to the rising prevalence of neurological and behavioural disorders in animals. Around 1% to 5% of dogs across the globe suffer from epilepsy, making anticonvulsant medications a key component of CNS drug demand.

According to a survey, 72% of dogs in the U.S. display at least one form of anxiety, with noise phobia, separation anxiety, and fear of unfamiliar people or objects being the most common. Veterinary advancements like enhanced diagnostic tools like MRI and CT scans have enabled the early detection of neurological conditions in animals.

Growing awareness campaigns and educational resources for pet owners have emphasized the vitality of mental and neurological health in animals, thereby boosting demand for CNS agents.

Oral Formulations Witness Increased Adoption with Ease of Administration

Oral formulations are expected to dominate with a share of 55% in 2024 owing to their convenience, versatility, and adaptability to a range of animal species and conditions. They are easy to administer for most pet owners with about 75% to 80% of pet owners preferring oral medications over other forms.

Flavoured medications make oral formulation appealing to pets, thereby enhancing adherence to treatment regimes. Compounded chewable tablets and soft chews for dogs have shown a 30% increase in compliance compared to conventional pill forms.

Chronic conditions often require long-term medication, thereby making oral formulations a preferable choice owing to their ease of use. Nearly 20% to 25% of senior pets in North America are on long-term oral medications for chronic conditions, thereby driving the demand for compounded oral formulations.

Massive Scale of Livestock Creates a Demand for Customized Medications

Livestock is emerging as the leading animal segment with a predicted share of 54.4% in 2024. The global cattle population is estimated at 987 million as of 2023 with the U.S. having approximately 93.8 million cattle, 74 million pigs, and 1.6 billion chickens as of 2023. This massive scale of livestock farming creates a demand for customized medications to treat infections, enhance growth rates, and manage health conditions.

Livestock animals are highly susceptible to infectious diseases owing to intensive farming practices and close living quarters. According to statistics, diseases like bovine respiratory disease (BRD) affect 20% of cattle in feedlots annually, resulting in significant economic losses.

Compounded medications are used to offer tailored treatments for specific pathogens. They are also used to create formulations with precise dosages for herd management. Livestock often requires medications in tailored dosages, formulations, and delivery methods based on species, age, and weight.

Market Introduction and Trend Analysis

Potential growth in the global animal drug compounding industry is predicted to be driven by an increase in veterinary partnerships with compounding pharmacies. Rising penetration and adoption of pet insurance is expected to ease the financial burden on pet owners, thereby making compounding drugs more accessible.

North America pet insurance coverage is predicted to grow by 15% annually, reaching 10 million insured pets by 2028. The industry also has a rising demand for eco-friendly veterinary products along with sustainable compounding practices amid growing concerns about sustainability.

Historical Growth and Course Ahead

The animal drug compounding market growth was robust at a CAGR of 5.8% during the historical period. Pet population witnessed a significant increase during the COVID-19 pandemic period as people sought companionship, thereby driving the demand for veterinary services and medications.

Over 70% of households in the U.S. are registered to have owned a pet in 2021, as per the American Pet Products Association (APPA). Demand for customization witnessed a rise during the historical period as several animals, particularly exotic pets, require specialized formulations that are unavailable in commercial drugs. Compounding pharmacies catered to these requirements by creating tailor-made solutions.

Flavored medications and precise dosages for small animals also witnessed popularity. The historical period also witnessed regulatory clarity as the U.S. FA issues the 2022 guidance on animal drug compounding under GFI #256, thereby enabling better-defined practices for compounded medications.

Market Growth Drivers

Rising Demand for Customized Medications for Pets

As veterinary care becomes sophisticated, there is a growing recognition that animals often require personalized treatment plans. According to the American Pet Products Association (APPA), 70% of households in the U.S. own at least one pet as of 2023. This spike in pet ownership has led to an increased need for veterinary care.

Compounding enables the preparation of medications in doses or forms that are not commercially available. For instance, veterinarians often prescribe medications in doses based on size, breed, or condition of the animal. Rising awareness regarding chronic and complex health conditions in pets, leading to an increased demand for specialized medications.

Several animals, especially pets like dogs and cats are notoriously difficult to medicate. Based on a survey conducted in 2020, the American Veterinary Medical Association (AVMA) survey, 30% to 40% of pet owners report having difficulty in administering oral medication to their pets. Compounded medications enable for flavouring options to make the process more manageable, thereby enhancing compliance.

Sustainability and Eco-friendly Products Gain Momentum

As consumers become environmentally conscious, the trend is extending to products they purchase for their pets. Based on a survey conducted in 2021, 73% of global consumers reported that they are willing to change their consumption habits to decrease environmental impact. This fosters a shift toward sustainability in the pet products market as well.

Over 41% of pet owners in the U.S. stated that they consider the environmental impact of a product before making purchases. The use of eco-friendly and sustainable source ingredients is a significant step toward sustainability in the animal drug compounding market.

Companies in the industry are progressively opting for plant-based or ethically sourced ingredients to avoid over-exploitation of natural resources. Companies are adopting biodegradable, recyclable, and reusable packaging for compounded drugs to decrease waste. For example,

• A survey conducted in 2023 revealed that 52% of consumers in the U.S. stated that they were willing to pay more for sustainable packaging.
• A 2019 study by the American Veterinary Medical Association (AVMA) revealed that 55% of veterinarians said that sustainability and eco-friendly practices were crucial in their decision-making when sourcing products and medications fir their practices.

Market Restraining Factors

Lack of Standardization Gives Rise to the Potential for Misuse or Overuse

The issue of misuse or overdose of drug arises because of the lack of standardization guidelines for compounding practices, improper application or dosing, and variability in drug quality. This can lead to adverse effects, treatment failures, and skepticism within the veterinary community.

Overdose can result in toxicity, organ damage, and fatal outcomes, while underdosing is likely to result in failure to treat the condition, potentially leading to disease progression or antibiotic resistance. A study published by the Journal of American Veterinary Medical Association (JAVMA), improperly compounded medications contributed to adverse outcomes in 5% of reviewed cases that involved exotic animals.

A FDA report from 2020 found that 15% of compounded animal drugs tested showed inconsistencies in their active ingredient levels that could compromise treatment outcomes. For instance, an outbreak of fungal infections in hoses in the U.S. in 2015 was traced back to contaminated compounded medications that led to over 40 cases of equine fatalities.

Market Growth Opportunities

Increasing Search for Healthcare Solutions for their Animals by Pet Owners

Pet insurance and financial support in animal drug compounding market is gaining significance as pet owners seek affordable healthcare solutions for their animals. Pet insurance is witnessing rapid growth particularly in developed countries like the U.S., the U.K., Canada, and parts of Europe.

Pet owners are becoming aware if the financial risks associated with unexpected veterinary expenses, thereby driving the adoption of insurance policies.

According to the North American Pet Health Insurance Association (NAPHIA), the U.S. reported that nearly 4.4 million pets were insured in 2022. The U.K. has also witnessed robust growth in pet insurance with 25% of dogs 18% cats insured in 2022 based on the statistics provided by the Association of British Insurers (ABI).

Veterinary Partnerships and Collaborations to Foster Innovations in Medications

Veterinary partnerships and collaborations are essential strategies for growth in the animal drug compounding market. Consequently, allowing companies to expand their reach, improve their service offering, and enhance the quality of care for animals. Veterinary clinics often partner with compounding pharmacies to offer personalized medication solution for animals.  

Pharmaceutical companies manufacturing standard animal medication often collaborate with compounding pharmacies to provide specialized formulations that address niche markets. Partnerships between veterinary practices and academic or research institutions can foster the development of new compounded medications or innovative treatments for animals.

Equine and large animals including horse, cattle, and livestock benefit from veterinary partnerships and collaborations, especially when dealing with conditions that require specialized or compounded medications. The U.S. FDA guidelines for veterinary compounding established under the Animal Medicinal Drug Use Clarification Act (AMDUCA) govern how veterinarians and compounding pharmacies can collaborate to provide customized medications to animals.

Competitive Landscape for the Animal Drug Compounding Market

Companies in the animal drug compounding market are working toward automating compounding processes to enhance efficiency, accuracy, and scalability. They are using advanced technologies like nano-encapsulation or controlled-release formulations to improve the bioavailability of drugs.

Brands ensure compounded drugs to meet regulatory requirements as they are crucial for safety and efficacy. Several companies are implementing rigorous testing for potency, purity, and safety to provide high-quality compounded medications. They are also offering customized medications tailored to individual animal requirements like specific dosages, flavours, and formulations that are not available in mass-produced drugs.

Recent Industry Developments

• In May 2024, Mixlab acquired NexGen Animal Health to extend its advanced compounding pharmacy services from companion animals to large animals, with continued financial support from Vanterra Ventures.
• In June 2023, Wedgewood Pharmacy merged with Blue Rabbit, integrating Wedgewood’s custom compounding expertise with Blue Rabbit’s innovative veterinary prescription technology and its five regional pharmacies. 

Animal Drug Compounding Industry Report Scope

Animal Drug Compounding Industry Segmentation

By Product

• CNS Agents
• Anti-Infective Agents
• Hormones and Substitutes
• Anti-inflammatory Agents
• Others

By Animal

• Companion
  • Cats
  • Dogs
  • Others
• Livestock

By Formulation

• Oral
• Injectable
• Others

Region

• North America
• Latin America
• Europe
• East Asia
• South Asia
• Oceania
• Middle East Africa

To know more about delivery timeline for this report Contact Sales