The global animal health market is undergoing a transformative shift. Valued at USD 62.89 billion in 2024, this vital industry is projected to grow at an impressive CAGR of 10.46% from 2025 to 2030, fueled by surging investments, technological advancements, and a growing emphasis on animal well-being. The convergence of Artificial Intelligence (AI) with veterinary science is proving to be a game-changer, reshaping diagnostics, drug development, and disease management across both companion and production animals.
As consumer expectations rise, and the boundaries between human and animal healthcare continue to blur, the industry is entering a new era—one that demands agility, innovation, and a deeper understanding of what animal health means in a connected, data-driven world.
A New Age of AI-Driven Veterinary Innovation
Among all the growth catalysts in animal health market, AI stands as the most dominant force. From diagnostic imaging to drug discovery, AI is quickly becoming an essential tool in modern veterinary practice.
One of the most notable developments came in January 2025, when Absci and Invetech partnered to integrate Absci’s Half-Life Extension (HLE) AI platform into the creation of veterinary medicines. Their goal: speed up and optimize drug development tailored for animals. This collaboration reflects the increasing commitment across biotech and pharma sectors to close the innovation gap between human and animal health.
Meanwhile, Cambridge University researchers unveiled a cutting-edge AI algorithm capable of detecting heart murmurs in dogs with 90% sensitivity. Trained on nearly 800 digital stethoscope recordings, this algorithm empowers primary care veterinarians with fast, reliable cardiovascular assessments—paving the way for early intervention and improved pet outcomes.
Similarly, SK Telecom’s X Caliber, an AI-based diagnostic platform, expanded into Southeast Asia in 2024, demonstrating that AI’s reach isn’t confined to Western markets. The technology enables fast veterinary diagnoses in Thailand, Malaysia, and Vietnam—democratizing advanced care and pushing the entire region toward a higher standard of animal welfare.
Market Dynamics: Innovation, Consolidation, and Regulatory Complexity
As innovation accelerates, market competition intensifies. From global corporations to niche startups, the animal health market landscape is a vibrant mosaic of players each carving out space in specialized areas—be it biologics, monoclonal antibodies, telehealth, or regenerative medicine.
Zoetis, a major player, expanded its R&D horizon with the Automation & Data Sciences group, focusing on data-driven insights, automated processes, and smarter drug development. This kind of vertical integration is key to maintaining dominance in a market where specialization and speed-to-market are paramount.
At the same time, strategic acquisitions are reshaping the playing field. In September 2024, Boehringer Ingelheim’s acquisition of Saiba Animal Health underscored the race to diversify portfolios with next-gen therapeutics for pets.
However, regulatory frameworks present both a challenge and a moat. While agencies like the FDA heavily regulate pharmaceutical development, veterinary diagnostics enjoy comparatively lighter oversight. This dual reality fosters innovation while reinforcing the dominance of well-capitalized companies who can navigate complex compliance pathways.
An important policy milestone came with the European Coordination for Animal Health Vaccination initiative in October 2024, targeting improved vaccine strategies to enhance both animal welfare and food safety across the EU.
Product Landscape: Pharmaceuticals Lead, But Software Surges
Pharmaceuticals continue to command the largest share of the market—43.42% in 2024. From antibiotics to parasiticides and anti-inflammatory drugs, demand remains high, driven by greater disease awareness and rising expectations among pet owners and livestock managers.
Yet the fastest-growing segment is veterinary telehealth, software, and livestock monitoring solutions, with an expected CAGR of 14.10%. Telehealth, in particular, surged during the COVID-19 pandemic and has retained momentum. Mella Pet Care, a Chicago-based startup, expanded into the UK and Canada in 2024 via its partnership with Vetster, signaling rising demand for remote diagnostics and treatment continuity.
Animal Type Analysis: Production Animals Rule, Companion Pets Rise
In 2024, production animals (livestock) generated the highest revenue, bolstered by a global push for food security, sustainable farming, and biosecurity programs. Governments and agricultural companies are investing in precision livestock farming and routine vaccination, especially in emerging economies, to keep up with the global food demand.
However, companion animals are catching up quickly. Pet owners are increasingly treating their animals as family—investing in pet insurance, premium healthcare services, and preventive care. This shift toward pet humanization is fostering a booming animal health market for advanced pharmaceuticals and AI-enabled diagnostics for cats, dogs, and even exotic pets.
Distribution & End-Use: E-commerce and Point-of-Care Testing Set the Pace
In terms of distribution, hospital and clinic pharmacies remain the leading channel, thanks to their comprehensive service offerings and regulatory access to controlled medications. However, e-commerce is gaining rapid traction, supported by ease of ordering, home delivery, and rising digital literacy among pet owners and farmers.
Online pharmacies also streamline supply chain management (SCM), cut costs by removing intermediaries, and allow for better tracking of orders. This appeals to both busy urban pet parents and remote livestock managers, giving e-commerce a clear edge in accessibility.
When it comes to end-use, veterinary hospitals and clinics dominate—offering a wide array of diagnostics and treatments. Yet in-house and point-of-care testing are projected to grow fastest, thanks to greater awareness around zoonotic disease prevention and early diagnosis. Diagnostic kits such as ELISA for heartworm detection are increasingly common in clinics and mobile vet units alike.
Regional Outlook: North America Dominates, but Asia and Europe Aren’t Far Behind
North America leads the global animal health market with a 35.69% share in 2024, owing to its strong infrastructure, high pet ownership, and proactive healthcare policies. Organizations like AHEM (Animal Health Emergency Management) and NAPHIA (North American Pet Health Insurance Association) are instrumental in maintaining industry standards, responding to outbreaks, and promoting insurance adoption.
The U.S. specifically benefits from government-led initiatives aimed at ensuring food safety, tracking disease outbreaks, and regulating product quality—elements critical for both economic and public health stability.
Europe, holding the second-largest market share, continues to invest in companion and production animal health alike. With coordinated vaccination programs and widespread pet insurance coverage, the region is expected to see steady growth through 2030.
Meanwhile, Asia-Pacific is emerging as a key growth frontier, driven by expanding middle classes, rising meat consumption, and improved veterinary infrastructure in countries like China, India, Thailand, and Vietnam. Strategic expansions like SK Telecom’s AI-driven X Caliber diagnostics are helping bridge the technology gap between developed and developing markets.
The Road Ahead: Tailwinds and Transformation
Looking forward, the animal health market is poised for rapid expansion, driven by the convergence of AI technologies, consumer-driven healthcare models, and regulatory advancements. But the road isn’t without its bumps. Substitute products such as natural remedies and DIY diagnostics present both a challenge and an opportunity—offering convenience, but sometimes at the cost of clinical accuracy.
Still, with robust innovation pipelines, rising demand for transparency, and a global shift toward preventive care, the market has all the signs of entering a golden age.
For companies ready to harness data, scale quickly, and adapt to evolving consumer expectations, the future of animal health is not just bright—it’s revolutionary.
Bottom Line:
The animal health market is no longer just about treating diseases—it’s about preventing them, predicting them, and personalizing care for every species. As AI and biotech deepen their roots in this industry, the line between animal and human health continues to narrow, heralding a future where innovation truly knows no boundaries.
