He also proposed annual reviews of the availability of alternative drug tests, to make sure that the expert panel which will approve the drugs was aware of all its options.
Those changes did not go far enough for some MPs, who wanted the legislation to explicitly state that no animal would be experimented on to approve legal highs for sale.
Green MP Mojo Mathers tabled an amendment which would have ruled out the use of data from animal tests, but it was voted against by National, United Future, and independent MP Brendan Horan.
Mr Banks felt so strongly about protecting animal rights that he urged the Greens to vote against the entire bill if Ms Mathers' amendment failed.
In a stirring speech, he told Parliament: "We are sacrificing animals at the altar of recreational drug use."
Mr Banks said animal testing to create life-saving pharmaceuticals was tolerated, but he could not tolerate torture of animals for the purpose of approving "Sunday afternoon" drugs.
"I care about young people ... but I care about animals, their welfare and their rights just as much.
"I want to put on record today that I like animals quite a lot better than I like a lot of people. I feel it's my responsibility in Parliament to get up and to speak on behalf of those creatures that we live together with on this earth that can't speak."
New Zealand First abstained from the vote.
Party leader Winston Peters said the amendment was too extreme.
"We would rather see a few rats sacrificed than tens of thousands of young peoples' minds sacrificed."
The animal testing issue has overshadowed much of the debate about the bill, which is supported by the majority of MPs on both sides of the House.
MPs were also expected to debate amendments which would ensure that synthetic drugs were sold in plain packages, and the removal of a sanction for possessing a non-approved psychoactive substance.
Animal testing
Government amendment
*Data from animal testing can not be used for approving legal highs if alternatives exist.
*Any animal testing must follow international guides and comply with the Animal Welfare Act.
Greens amendment
*Data from animal testing can not be used for the purpose of approving legal highs.