Against a $3.5 billion deal: the US competition regulator has gone to court to stop the two largest suppliers of veterinary clinics from merging

What happened

On 13 November 2026, the US Federal Trade Commission (FTC) filed a lawsuit to block Covetrus's $3.5 billion acquisition of its rival MWI Animal Health. The suit was filed in the US District Court for the Southern District of New York. In the regulator's view, the deal would combine the two largest distributors of veterinary products in the country and drive up prices.

Who joined the lawsuit

The attorneys general of 13 states filed the suit together with the FTC: Arizona, Arkansas, California, Colorado, Maine, Michigan, Minnesota, Nebraska, New York, North Carolina, Ohio, Oregon and Texas. The commission voted 2–0 to seek a permanent injunction against the deal. The defendants are Covetrus and its owners, the investment firms Clayton, Dubilier & Rice and TPG.

Who Covetrus and MWI are

MWI Animal Health has supplied medicines, vaccines and consumables to veterinary clinics and livestock producers for more than 50 years. It is currently owned by the pharmaceutical distributor Cencora. Covetrus, headquartered in Portland, Maine, also offers clinics software for ordering, stock control and patient management in addition to supplies.

The terms of the deal

The deal was announced in February 2026. Cencora was to receive $1.25 billion in cash, $800 million in preferred shares and $1.45 billion in ordinary shares of the combined company. It would have kept a non-controlling stake of 34.3%. The companies described the combination as a single platform for supplies, technology and services.

The regulator's argument

The FTC says Covetrus and MWI are each other's closest competitors in two markets: supplying veterinary clinics and supplying large corporate groups. Both sell medicines, vaccines, surgical supplies and consumables such as gloves, bandages and syringes. Their customers range from single-vet practices to groups with hundreds of branches.

An "all-out price war"

According to the regulator, the two companies competed hard on price. Covetrus cut prices and offered discounts through its VetSuite programme so as not to lose out to MWI. The online platform Vetcove, where vets compare prices and use one supplier's offer to negotiate with the other, intensified this rivalry. The complaint calls it an "all-out price war".

Why other suppliers do not count

The FTC argues that specialist distributors, manufacturers, retail chains and small suppliers do not offer real competition to the major clinic suppliers. Covetrus and MWI have national delivery networks, discounts and rebates that small companies cannot match. Newcomers face serious barriers. So, in the regulator's view, the merger would create a highly concentrated market.

The regulator's words

Daniel Guarnera, director of the FTC's Bureau of Competition, said vets and millions of pet owners benefit when distributors compete with low prices and good service. In his words, the deal would reduce competition in an already concentrated market and raise prices for vets and their clients, and Covetrus wants to eliminate its closest competitor rather than compete for clinics.

Covetrus's response

Covetrus called the regulator's view of the market "narrow and outdated" on the same day. The company said the merger would improve the economics of clinics and that the lawsuit does not reflect how vets actually buy the products they need. Covetrus says it is confident in the deal and ready to defend it in court.

The argument about clinics' choice

Covetrus lists the alternatives it says clinics have. Many manufacturers sell directly and run their own sales teams. Other national and regional distributors operate in the market. According to the company, more than 60% of US clinics use online marketplaces where they can order from more than 40 suppliers and thousands of manufacturers.

Retail and pet owners

The company also points out that retail chains already sell flea and tick treatments, medicines and food, including prescription products, directly to pet owners, bypassing both clinics and distributors. According to Covetrus, clinics buy the same products from several suppliers and negotiate directly with manufacturers.

How this could affect owners

Distributors are a link that owners do not see, but they determine how much a clinic pays for vaccines, anaesthetics, bandages and medicines. When purchase prices rise, clinics pass them on in their price lists. So the dispute over a merger of suppliers ultimately concerns the bill a dog or cat owner receives after an appointment.

Veterinary prices are rising

In the US, as in Europe, pet owners have complained in recent years about the rising cost of veterinary care. The reasons vary: salaries, equipment and medicines are getting more expensive, and large groups are buying up independent clinics. Regulators are looking ever more closely at market concentration, from clinic groups to medicine suppliers.

What happens next

The dispute will now be decided by the court. The companies may try to prove that the market is wider than the FTC believes or offer concessions, such as selling part of the business. The regulator may seek a temporary ban on closing the deal until a ruling on the merits. Such cases in the US often last months, and some deals are abandoned after a lawsuit.

The history of the review

The regulator had been examining the deal since summer 2026, requesting data from clinics, competitors and manufacturers and assessing the impact on supplies and practice management software. According to industry reports, the companies proposed measures in the autumn to address the concerns, but the regulator did not accept them and decided to go to court.

Why clinic software matters

Covetrus is not only a warehouse and delivery service but also software for ordering, record-keeping and patient management. Regulators fear that control over software and supplies in the same hands could tie clinics to a single supplier. When purchasing is built into a clinic's everyday software, switching to another supplier becomes harder.

Independent clinics

Small independent clinics have the most to lose from market concentration. Large groups negotiate discounts directly with manufacturers, while a small practice has to work through a distributor. If there are fewer competitors, independent clinics will have less room to negotiate, and that will hit their ability to keep prices affordable.

Farm animals

MWI supplies products not only for dogs and cats but also for livestock farming. Vaccines and medicines for cows, pigs and poultry also pass through distributors. So the court's decision matters for farmers too, whose spending on veterinary care and disease prevention is already rising.

Online marketplaces as a counterweight

Services that show a clinic the prices of several suppliers have become a noticeable factor in the market. The FTC believes such platforms intensified competition between Covetrus and MWI. Covetrus, on the contrary, cites them as proof that clinics have enough choice even without MWI. The court will have to decide who is right.

Deals in the veterinary market

The veterinary market has attracted investors in recent years: funds are buying clinics, laboratories, suppliers and software developers. This speeds up the adoption of technology but raises disputes over prices and vets' independence. The lawsuit against Covetrus is one of the most high-profile cases of a regulator trying to stop such consolidation.

How purchasing works in a clinic

An ordinary clinic uses dozens of items every day: vaccines, antibiotics, anaesthetics, sutures, dressings and food for sick animals. Keeping a large stock is expensive, so orders are frequent and small. The distributor determines not only the price but also whether the vaccine you need arrives tomorrow morning or in a week.

Why this case matters for the sector

The ruling in the Covetrus case will set a benchmark for other deals in veterinary medicine. If the court sides with the FTC, it will be harder for investors to combine big players in the same market. If the companies win, consolidation is likely to accelerate. Either way, the dispute has drawn attention to what makes up the price of veterinary care.

What this means for Europe

Consolidation is under way in Europe too: groups are buying up clinics, and competition authorities in the UK, Sweden and other countries are examining rising veterinary prices. The US lawsuit shows that regulators are prepared to intervene at the level of suppliers as well. For pet owners in Europe it is a reminder that the price of an appointment depends on the whole chain, not just the clinic.

What owners can do

Owners have no say in mergers, but they can manage costs sensibly. It is worth asking about the cost of treatment in advance, comparing prices for routine procedures, checking whether a prescription medicine can be bought from a pharmacy, and not putting off prevention — treating an advanced illness is almost always more expensive.

When to see a vet

Do not put off a visit to the vet because of worries about cost if your animal refuses food, vomits, has diarrhoea for more than a day, has difficulty breathing, is bleeding, has seizures or is in severe pain. Ask the clinic about the treatment plan and cost: many vets offer options to suit different budgets.