FTC sues to block Covetrus' merger with MWI Animal Health

The Federal Trade Commission (FTC) has filed a lawsuit to block Covetrus' proposed $3.5 billion acquisition of MWI Animal Health, alleging that the deal would merge the 2 largest veterinary distributors in the US and drive up costs for veterinary clinics and clients.¹ Covetrus responded the same day, calling the agency's view of the market "narrow and outdated," stating that it is prepared to defend the transaction in court.²

The complaint, filed November 13, 2026, in the US District Court for the Southern District of New York, names Covetrus and its owners, private equity firms Clayton, Dubilier & Rice LLC and TPG Inc. Covetrus agreed to acquire MWI, which the FTC refers to as MWI Veterinary Supply Inc., from its parent company, Cencora Inc. Attorneys general from Arizona, Arkansas, California, Colorado, Maine, Michigan, Minnesota, Nebraska, New York, North Carolina, Ohio, Oregon, and Texas joined the complaint. The commission voted 2-0 to authorize staff to seek a permanent injunction.¹

Background on the deal

Covetrus and Cencora announced the merger in February 2026.³ Under the agreement, Cencora would receive $1.25 billion in up-front cash, $800 million in preferred equity, and $1.45 billion in common equity in the combined company, retaining a 34.3% noncontrolling stake in the merged business. The deal was subject to customary closing conditions, including regulatory approvals, and Cencora said at the time that its fiscal year 2026 outlook did not assume a close before its fiscal year ended in September 2026.³

MWI has supplied animal health products to veterinary practices and livestock producers for more than 5 decades, serving both companion and production animal markets. Covetrus, headquartered in Portland, Maine, provides technology-enabled tools for practice operations, including ordering, inventory, and clinical workflow systems. When the deal was announced, the companies described the combination as a single platform spanning product distribution, technology, and services. "This combination is about making animal health care more affordable and accessible," Ben Wolin, president and CEO of Covetrus, said at the time.³

The FTC's case

According to the FTC, Covetrus and MWI are each other's closest competitors in 2 markets: distribution to veterinary clinics and distribution to large corporate accounts. Both companies supply pharmaceuticals, vaccines, surgical supplies, and "white goods" such as gloves, gauze, and syringes, along with thousands of other products and related services. Their customers range from single-veterinarian practices to corporate groups with hundreds of clinics.¹

The agency alleges that the 2 distributors have competed aggressively on price, with Covetrus matching MWI's pricing through price cuts and rebates offered through its VetSuite program. The FTC also points to Vetcove, an online platform that lets veterinarians compare prices and use one distributor's pricing to negotiate with the other, as having intensified that rivalry. The complaint characterizes years of this competition as an "all-out price war."¹

The FTC contends that specialty distributors, manufacturers, retailers, and other fringe suppliers do not meaningfully constrain the major veterinary clinic distributors, and that new entrants face structural barriers. Covetrus and MWI both operate national distribution networks and offer discounts and rebates that smaller rivals cannot match, according to the agency. The FTC alleges that the merger would create highly concentrated markets, making it presumptively unlawful under case law and the 2023 merger guidelines issued by the FTC and the US Department of Justice. The release did not include specific market share figures.¹

"Veterinarians and millions of American pet owners benefit when veterinary distributors compete by offering lower prices and better service. This transaction will reduce competition in an already concentrated market and drive up prices for veterinarians and their customers," said Daniel Guarnera, director of the FTC's Bureau of Competition. "These two companies are engaged in fierce head-to-head competition and Covetrus wants to eliminate its closest competitor rather than compete for veterinary clinic customers."¹

Covetrus pushes back

In its statement, Covetrus said the merger "stands to improve the economics of veterinary practices" and that the FTC's lawsuit "does not reflect an accurate understanding of how veterinarians actually buy the products they need."²

The company argued that 15 years of shifting industry dynamics have given practices more purchasing options than ever, including the following²:

• Manufacturers. Many sell directly to clinics without involving Covetrus or MWI and, in some cases, maintain sales teams larger than those of the distributors. Covetrus said its data show that nearly all practices purchase directly from suppliers.
• Other distributors. Competitors operate at national and regional levels, serving both veterinary groups and individual clinics.
• Online veterinary marketplaces. Covetrus said these platforms are used by more than 60% of US practices and allow clinics to compare prices, earn rebates, and order from more than 40 distributors and thousands of manufacturers through a single shopping cart.

Covetrus also said clinics, including large practice groups, routinely buy the same products from more than 1 supplier, place multiple orders each week, and negotiate directly with manufacturers. It added that all suppliers in the space rely on the same national carriers for delivery and that retailers now sell flea and tick treatments, pharmaceuticals, and prescription and nonprescription pet foods directly to pet owners, bypassing both distributors and clinics.²

"Together, Covetrus and MWI will make it easier and more efficient for practices to access the products, technology and support they need, while investing in innovation, maintaining service and supply chain reliability, and lowering the cost of serving veterinary practices," the company stated.

"Covetrus is confident in the merits of this transaction and the benefits it will bring to veterinary practices, and we are fully prepared to defend them in court," the statement concluded.²

References

1. FTC sues to block veterinary supplies distributor Covetrus's $3.5 billion acquisition of rival MWI. News release. Federal Trade Commission. November 13, 2026. Accessed November 13, 2026. https://www.ftc.gov/news-events/news/press-releases/2026/11/ftc-sues-block-veterinary-supplies-distributor-covetruss-35-billion-acquisition-rival-mwi
2. Covetrus issues statement on FTC decision to challenge proposed merger with MWI Animal Health. News release. Covetrus. November 13, 2026. Accessed November 13, 2026. https://www.prnewswire.com/
3. Bautista-Alejandre A. Covetrus and MWI Animal Health agree to merge in $3.5 billion deal. dvm360. February 23, 2026. Accessed November 13, 2026. https://www.dvm360.com/view/covetrus-and-mwi-animal-health-agree-to-merge-in-3-5-billion-deal