How about us providing a small habitat for these creatures to live out the rest of their lives in return for their use in these studies? A small inconvenience I would think in return for such sacrifice. Can you imagine...?
It's a nice idea, but with the sample sizes needed to get statistically significant results, the logistics of this would be a nightmare.
As it is, one small study takes a single room about the size of a large walk-in closet. Animals are typically housed in cages with a same-sex buddy so that they have companionship but do not reproduce. The cages are large enough to give animals room to stretch and exercise. Each experiment requires a separate room from the others so that they do not contaminate one another (in terms of conditions, pathogens, sounds, smells, whatever).
The most space-efficient way to maintain humane conditions while continuing to keep the animals and preventing further reproduction is to keep them in this configuration.
Let's take rats as an example. The average life span of a rat is 2-3 years. The average amount of time studying a single cohort of rats might be a semester. Young rats are typically used because they are healthy. For each experiment requiring rats, we will need to move these rats to a new room after the experiment is over to live out their ratty lives, and make room for the new rats.
Suppose 1 researcher is doing animal research with rats. Say he works at the average rate, about one cohort a semester. In semester one, we will need one room.
S2, we need 2.
S3, we need 3.
S4, 4
S5, 5 (Over this semester, we will lose the rats from semester 1)
S6, 5 (Here we are losing semester 2's rats, and 1's were replaced by 5's)
So for each researcher, we will need 5-ish rooms.
Now say we run a school like the one I went to. We had 3 people working with rats, and each one used 60, usually. If we let them live out their lives, this number would balloon to 15 rooms, and from 180 rats at a time to 900. My school would not have been able to afford a facility that big.
Moreover, it took 4 animal care techs to maintain the 3 rat rooms an ensure everything was humane, and they were spread thin. If we just scale up and pretend that people would work the same as they did before, it would take 20 techs. Our department was already operating over budget - if we had to deal with this situation, we would never have been able to do any research at all. We were straining at the edges of our animal care budget with 3 rooms, and as I showed, a single researcher would exceed that.
So, yes, it would be great to let the animals live their lives out, but it would make animal research prohibitively expensive. Besides, the animals would hardly have full, happy lives in this situation - it would require even more expense to make sure that they actually got mentally stimulating habitats, tasty food, and regular interaction.