This paper presents ongoing results of the EU project PEGASUS (Public Perception of Genetically modified Animals – Science, Utility and Society, 7th FP).The overall objective is to provide support for future policy regarding the development, implementation and commercialisation of genetically modified (GM) animals, both terrestrial and aquatic, together with the foods and pharmaceutical products derived from them. Food products derived from GM animals have not yet entered the market. Nonetheless, the ongoing discussion about GM crops and the recently initiated discussions about the safety and ethics of foods and pharmaceutical products derived from cloned animals have set the stage for the socio-economical issues that will surround the introduction of GM animals in the food and pharmaceutical chains. This papers shows the economic and governance pros and cons of GM applications in the animal and pharmaceutical chains, as well as the factors affecting their adoption. Public and producers acceptance, technical improvements and public policies are considered as the main factors affecting the application of GM animals techniques in livestock and pharmaceutical chains.