British vets could face price caps on medicines, prescriptions and other services like cremations, the regulator has indicated, as it outlined changes it is considering to the way the UK’s £2bn veterinary sector operates.

The Competition and Markets Authority (CMA) has been investigating the sector, looking at whether a lack of competition in the sector has contributed to soaring prices.

Prices for treatments grew by 60% between 2015 and 2023, compared with inflation of 35% for other general services, according to CMA research.

The regulator is also pushing for more transparency as part of the overhaul due to be finalised in the coming months.

In addition to the price caps, the CMA is looking into a ban on bonuses linked to offering specific treatments.

It said on Thursday that it would look into a ban on any policies that would curtail vets’ “clinical freedom”. Some vets had reported feeling under pressure to meet targets in relation to the treatments they sell.

It found that businesses were marking up medicine prices, sometimes by as much as four times the purchase cost.

The watchdog also found there was a lack of transparency around the cost of treatments and what choices were available.

In a list of potential remedies, the CMA said vets could be forced to create a clear online display of prices for medicines, surgeries, treatments and out-of-hours help. The working paper also suggested that the mark-up charged on pet cremations, sold to customers at a “vulnerable moment”, might be capped.

The watchdog has also suggested a comparison website making it compulsory for clinics to inform owners if cheaper options are available.

The CMA expects to release a provisional report on what measures it will take in the summer months, with a final decision by November.

The CMA said basic local vet services are worth £2bn-£2.5bn a year, but when other aspects such as cremation, specialist treatments and medicines are taken into account, the overall value of the industry is estimated at £5.7bn a year.

The competition body highlighted how the sector was increasingly being dominated by larger firms and how this might be reducing consumer choice.

There are about 5,000 vet practices in the UK, it said, but since 2013, approximately 1,500 of these have been acquired by six large corporate groups.

They are CVS, Independent Vetcare Ltd, Linnaeus, Medivet, Pets at Home and VetPartners.

Four of these six tend to retain the name and branding of an independently-owned practice when they buy it, which the CMA said may create an “illusion of competition” for consumers if they are trying to shop around to find alternative practices.