The field of bone tissue engineering has shown a great variety of bone graft substitute materials under development to date, with the aim to reconstruct new bone tissue while maintaining characteristics close to the native bone. Currently, insufficient scaffold degradation remains the critical limitation for the success of tailoring the bone formation turnover rate. This study examines novel scaffold formulations to improve the degradation rate in vivo, utilising chitosan (CS), hydroxyapatite (HAp) and fluorapatite (FAp) at different ratios. Previously, the P28 peptide was reported to present similar, if not better performance in new bone production to its native protein, bone morphogenetic protein-2 (BMP-2), in promoting osteogenesis in vivo. Therefore, various P28 concentrations were incorporated into the CS/HAp/FAp scaffolds for implantation in vivo. H&E staining shows minimal scaffold traces in most of the defects induced after eight weeks, showing the enhanced biodegradability of the scaffolds in vivo. The HE stain highlighted the thickened periosteum indicating a new bone formation in the scaffolds, where CS/HAp/FAp/P28 75 µg and CS/HAp/FAp/P28 150 µg showed the cortical and trabecular thickening. CS/HAp/FAp 1:1 P28 150 µg scaffolds showed a higher intensity of calcein green label with the absence of xylenol orange label, which indicates that mineralisation and remodelling was not ongoing four days prior to sacrifice. Conversely, double labelling was observed in the CS/HAp/FAp 1:1 P28 25 µg and CS/HAp/FAp/P28 75 µg, which indicates continued mineralisation at days ten and four prior to sacrifice. Based on the HE and fluorochrome label, CS/HAp/FAp 1:1 with P28 peptides presented a consistent positive osteoinduction following the implantation in the femoral condyle defects. These results show the ability of this tailored formulation to improve the scaffold degradation for bone regeneration and present a cost-effective alternative to BMP-2.