(Bloomberg) -- The European Commission is investigating whether US animal health company Zoetis Inc. breached antitrust laws by preventing the market launch of a competing medicine to treat chronic pain in dogs. 

Zoetis, which was spun out of Pfizer Inc. over a decade ago, makes Librela, the only monoclonal antibody drug currently approved in Europe to treat osteoarthritis pain in dogs. 

The commission said Tuesday that it’s concerned that alongside developing Librela, Zoetis also bought a similar late-stage pipeline product only to then cancel the launch of that drug and refuse to transfer it to a third party that had exclusive commercialization rights. 

If Zoetis has engaged in such exclusionary behavior it would be be a breach of EU competition rules, the Commission said. 

Shares of Zoetis fell more than 2% in early trading in New York. Its stock is little changed in the past year.  

Zoetis said the EU’s probe relates to an experimental compound from an acquisition it completed 7 years ago. “We believe that both the acquisition of the compound and our subsequent decision to cease development of it were sound, rigorous and lawful,” the company said in an emailed statement. 

Zoetis said it will continue to cooperate with the investigation and was confident any “potential concerns are unfounded.” 

This is the commission’s first formal investigation into potential abuse relating to the exclusionary termination of a pipeline product. The probe could lead to a formal warning from EU regulators, with the risk of a future penalty of 10% of global turnover.

The veterinary industry in Europe has been attracting close attention from regulators. In the UK, the antitrust regulator has opened a full investigation into the competitiveness of pricing and access to pet medicines after receiving more than 56,000 responses from the public and the industry. 

The primary concern is over the ability of pet owners to find “basic information like price lists and prescription costs - and potentially overpaying for medicines,” Britain’s Competition and Markets Authority said. 

Read More: UK Antitrust Regulator to Deepen Probe into Vet Market

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