China Galaxy Securities has released a research report stating that laboratory animals are a fundamental necessity for innovative drug research and development, with deep industry barriers. Two key sub-sectors have medium- to long-term growth logic: the humanized mouse track shows stronger growth certainty and smoother cyclical fluctuations; the experimental monkey track faces strong supply constraints, with short-term price increases bringing significant earnings elasticity. Leading domestic companies, leveraging proprietary germplasm resources and integrated model-plus-service capabilities, are continuously achieving domestic substitution and expanding overseas clients, with potential for long-term global market share growth.
Laboratory animals are essential "living reagents" for preclinical innovative drug R&D, covering the entire process from target validation to efficacy screening and toxicology safety evaluation. The downstream market includes university research institutions, innovative drug companies, and CRO companies. Barriers such as qualifications, breeding cycles, and heavy asset investment create a high industry threshold. As global and domestic pharmaceutical R&D spending continues to expand, China's pharmaceutical R&D spending is expected to reach $45.9 billion in 2025, with the preclinical CRO market size at $3.6 billion, directly driving rapid growth in demand for laboratory animals. In 2023, the global model animal market was $10.7 billion, while the Chinese market was 5.7 billion yuan, with a compound annual growth rate of 18.1% from 2022 to 2027, significantly higher than the global rate of 9%. The industry has broad space for domestic substitution and overseas expansion. European and American leaders, relying on century-old germplasm resources and globally compliant services, hold advantages. Domestic companies lead in the non-human primate track, with rapid catch-up in gene-edited mouse technology, but there remains a gap in high-end germplasm and global integrated services.
Laboratory animal species are diverse, but mice and experimental monkeys are the two main carriers, with high prosperity in sub-sectors, simultaneous growth in products and supporting services, but some divergence in growth drivers. 1) Laboratory mice: With high genetic homology, low breeding costs, and strong model plasticity, they are the core carriers for early screening of small molecule and oncology drugs. In recent years, over half of the fully human antibodies approved by the FDA and NMPA rely on transgenic mice for preparation. Genetically modified mice and humanized mice have become mainstream, aligning with the R&D needs of fully human antibody drugs. 2) Laboratory monkeys: With 90%-98% genetic homology to humans, they are irreplaceable species for toxicology and immunogenicity evaluation of macromolecular drugs such as monoclonal antibodies, ADCs, and oligonucleotides, leading to a long-term supply-demand mismatch. On the demand side, the continuous expansion of innovative macromolecular pipelines drives up procurement volumes; on the supply side, the breeding cycle of cynomolgus monkeys is as long as 6-7 years, with aging populations and limited new breeding capacity, leading to a new round of price increases. The spot price per unit is expected to rise to 180,000-200,000 yuan by 2026. Risks include policy and regulatory compliance risks, downstream demand fluctuations and industry competition risks, germplasm resources and supply chain risks, technological iteration and intellectual property risks, and production operation and biosafety risks.
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