UK’s Veterinary Sector Faces Formal Market Probe Over Pricing Concerns

The Competition and Markets Authority (CMA) announced on Thursday that Britain’s vet sector will undergo a formal market investigation following an initial review that raised significant concerns about pricing and competition. This move comes in response to worries that pet owners might not be receiving fair value for veterinary services.

The CMA began examining Britain’s veterinary market last September, driven by concerns over the potential for overpricing and the dominance of a few large companies in local markets. The British veterinary market is substantial, valued at over 2 billion pounds ($2.54 billion).

In March, the CMA published its preliminary review, highlighting several issues, including the possibility that pet owners are overpaying for medicines, the concentration of local markets, and the behavior of large companies that could stifle competition and reduce consumer choice.

To ensure a thorough and impartial investigation, an inquiry group composed of independent experts will oversee the market probe, according to the CMA.

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The investigation will scrutinize the practices of Britain’s six largest veterinary groups: CVS Group, IVC, Linnaeus, Medivet, Pets at Home, and VetPartners. Since 2013, these companies have acquired 30% of the 5,000 veterinary practices in Britain, which has sparked concerns about reduced competition and higher prices.

CVS Group expressed its commitment to cooperating with the investigation. “We will continue to proactively support the CMA through this market investigation,” CVS said in a statement on Thursday. Similarly, a spokesperson for Pets at Home emphasized their cooperation, stating, “We will continue to fully cooperate with the CMA to ensure our unique and pro-competitive business model of locally-owned vet practices is fully understood.” Pets at Home maintains that their practices are led by individual vets who independently determine their pricing, products, and services.

Following the announcement, shares in Pets at Home fell by 3.3%, while CVS Group saw a 3.2% increase.

CMA Chief Executive Sarah Cardell highlighted the broader context of the investigation, acknowledging the challenging working conditions and staff shortages faced by vets. “While we’re aware of acute staff shortages and difficult working conditions for vets, we consider a formal market investigation is essential to ensure good outcomes for the millions of pet owners in the UK as well as professionals working in the sector,” Cardell said.

Source: Reuters