AI in Pharmaceutical Market

The global AI in pharmaceutical market was valued at around US$807.2 Mn in 2018 and is projected to reach revenue worth around US$4,451.6 Mn by the end of 2030. Between the forecast years 2023 and 2030, the market is expected to witness a robust CAGR of 19.1%.

Market Analysis in Brief

AI in pharma refers to the use of Artificial Intelligence (AI) technologies and techniques in various aspects of the pharmaceutical industry. AI can accurately recognise various disease patterns, thus enabling the identification of drug compositions that would be better suited for the treatment of various diseases. That said, by embracing Artificial Intelligence, pharmaceutical companies can lower their research and development costs, prevent human errors, and accelerate research timeline thus resulting in the development of affordable, effective, and profitable drugs. In this backdrop, the use of AI in the discovery and development of novel drugs is expected to augment the growth of the AI in pharmaceutical market on the global front.

AI has the potential to revolutionise the fields of drug discovery, development, and patient care by harnessing the power of data analytics, machine learning, and natural language processing. AI in pharma has the potential to accelerate drug discovery timelines, reduce costs, and improve patient outcomes by enabling data-driven decision-making, predictive modelling, and personalised treatment approaches. As AI technologies continue to advance, they are expected to play an increasingly significant role in transforming the pharmaceutical industry.

Key Report Findings

• Up from the revenue worth around US$807.2 Mn attained in the year 2018, the global AI in pharmaceutical market size will witness promising growth through the end of 2030, reaching an estimated valuation of US$4,451.6 Mn.
• Increasing use in drug discovery and drug development areas will complement the growth of the AI in pharmaceutical market to a large extent.
• Use of new technologies in pharmaceutical marketing and predictive forecasting will bode well for the AI in pharmaceutical market.
• Application of AI in delivering personalised treatment will bolster the AI in pharmaceutical market growth.
• Asia Pacific will be the fastest progressing market for AI in pharmaceutical industry while North America remains at the forefront.

Market Drivers

Increasing Adoption Potential in New Drug Discovery

The pharma sector has long relied on advanced cutting-edge technologies in a bid to deliver safe, effective, and reliable drugs to the market. Moreover, with the recent COVID-19 pandemic, it has become more important than ever for drug manufacturing companies to delivery vaccines and drugs to the market at a faster pace than the earlier scenario. Machine learning, and AI have played a critical role in achieving this objective thus transforming the consumer healthcare business and the pharmaceutical sector.

Pharma brands have been leveraging AI to aid the competitive and relatively expensive drug discovery process. AI can accurately recognise various disease patterns, thus enabling the identification of drug compositions that would be better suited for the treatment of various diseases. That said, by embracing AI, pharmaceutical companies can lower their research and development costs, prevent human errors, and accelerate research timeline thus resulting in the development of affordable, effective, and profitable drugs.

In this backdrop, the use of AI in the discovery and development of novel drugs is expected to augment the growth of the AI in pharmaceutical market on the global front. The market is also driven by rising healthcare expenditure and need for cost-effective solutions, growing incidence of chronic disease, and advancements in AI technologies.

Dramatically Rising Adoption of AI in Drug Discovery and Development

Artificial intelligence (AI) is increasingly being used in drug discovery and development to accelerate the process of finding new drugs and treatments. AI can be used to analyse large datasets to identify patterns and trends that may indicate potential new treatments. The adoption of AI in drug discovery and development is increasing rapidly. AI can be used to identify new drug targets, design and optimise drug molecules, and predict drug efficacy and safety.

Additionally, AI can be used to identify biomarkers that can be used to predict drug response and improve patient outcomes. AI is increasingly being used in drug discovery and development to speed up the process of bringing new drugs to market.

Boom Around Advanced Technology-enabled Personalised Treatment

Apart from drug development, AI also enables physicians to delivery improved personalised treatments to patients. For personalised treatment, real time patient data is essential. By using machine learning and AI, access to real time patient data is possible which aids physicians to carry out customised treatment options.

Moreover, AI powered solutions can empower pharma brands to analyse volumes of patient data by embracing a data driven approach. This can be used to get early insight regarding the condition thus enhancing the diagnostic capabilities of physicians and clinicians. In addition, AI, and machine learning can be used for predictive forecasting, clinical trial improvisation by identifying appropriate candidates and even pharmaceutical marketing. That said, the use of new age technologies in delivering successful personalised treatments is expected to drive the growth of the AI in pharmaceutical market.

Overview of Key Segments

Drug Discovery the Key Application Area

Drug discovery application is the major contributor in AI in pharmaceutical market. It is valued at US$291.7 Mn in 2022 and it is expected to reach around US$1,225.9 Mn by 2030. AI has revolutionised drug discovery and has become an invaluable tool in the pharmaceutical industry. Its applications in drug discovery encompass various stages of the process, from target identification to clinical trials.

AI algorithms can analyse vast amounts of biological data, including genomic and proteomic data, to identify potential drug targets. By understanding disease mechanisms and identifying relevant molecular pathways, AI helps researchers focus on the most promising targets for drug development.

The integration of AI into drug discovery has the potential to accelerate the process, reduce costs, and increase the success rate of developing new and more effective medications. As AI technologies continue to advance, they are expected to play an increasingly prominent role in drug discovery and revolutionise the pharmaceutical industry.

Natural Language Processing Dominant Technology Segment

Natural language processing (NLP) is popular in AI in the pharmaceutical industry for several compelling reasons. The pharmaceutical industry generates an enormous amount of unstructured text data from sources such as research papers, clinical trial reports, medical literature, drug databases, and electronic health records. NLP provides the ability to extract, organise, and analyse this data, converting it into valuable insights and knowledge that can be used to improve drug discovery and patient care.

NLP helps researchers sift through vast repositories of scientific literature and medical knowledge more efficiently than manual methods. It aids in identifying potential drug candidates, drug targets, and relevant biological pathways, thus speeding up the drug discovery process.

Growth Opportunities Across Regions

North America Maintains a Dominant Positioning

Technological advancements and their applications in different sectors have always prevailed in the developed nations in North America. Being one of the major technology hubs globally, North America is expected to account for a major stake in the AI in pharmaceutical market. Advances in Artificial Intelligence in the region have transformed various industries and pharmaceutical sector is no exception. By leveraging AI, it has become possible to identify patients with rare diseases, make predictions apropos to magnitude of the disease and prescribing focus of physicians.

The AI in pharmaceutical market in North America is poised to witness significant transformation on account of various applications of AI in the sector. Factors such as application of Artificial Intelligence in clinical trials and rising need of drug discovery and drug development backed by rising burden of chronic diseases remains instrumental in driving the growth of the AI in pharmaceutical market.

Furthermore, the presence of industry majors and increasing number of cross industry partnerships and collaborations are likely to influence the growth of the AI in pharmaceutical market. For instance, EQRx, and Insilico Medicine collaborated to combine their expertise in small molecule clinical development, design, and commercialisation in March 2022.

The US in the Investment Bandwagon

In recent years, global investment in AI in the pharmaceutical industry has been increasing rapidly. According to a report by Accenture, global investment in AI in the pharmaceutical industry is expected to reach US$6.3 Bn by 2025. This is a significant increase from the US$1.1 Bn invested in 2019.

The United States is the largest investor in AI in the pharmaceutical industry, accounting for nearly half of the global investment. The US is followed by China, which is investing heavily in AI to improve its drug discovery and development capabilities. Other countries investing in AI in the pharmaceutical industry include the UK, Germany, France, and Japan.

Asia Pacific Represents the Fastest Growing Regional Pocket

Asia Pacific is the fastest growing region in AI in pharmaceutical market. It is growing at the 20.8% CAGR over the forecast period. AI adoption in the pharmaceutical industry in the Asia Pacific region was gaining momentum. The Asia Pacific region, which includes countries like China, Japan, India, and South Korea has been actively embracing AI-driven technologies across various sectors, including healthcare and pharmaceuticals. AI is being leveraged to accelerate the drug discovery and development process.

Pharmaceutical companies and research institutions in Asia Pacific are using AI algorithms to analyse massive datasets, including genetic information, protein structures, and chemical compounds, to identify potential drug candidates. By applying AI-driven simulations and predictions, researchers can optimise drug designs and assess their efficacy more efficiently. The Asia Pacific region is at the forefront of incorporating AI into precision medicine initiatives.

AI tools are being widely used to analyse patient data, including genetic profiles and medical histories, to tailor treatment plans to individual patients' unique characteristics. This approach enhances treatment outcomes and reduces adverse reactions.

Similar to global trends, Asia Pacific is also exploring drug repurposing using AI. By analysing existing drug databases and medical literature, researchers can identify potential new therapeutic uses for approved drugs, opening up new treatment possibilities.

Competition Landscape Analysis

The competition in the field of AI in pharmaceutical has been intensifying, with numerous companies and research institutions vying to leverage AI technologies to improve drug discovery, development, and patient care. The companies operating in AI in pharmaceutical market are GNS Healthcare, Benevolent AI, Berg Health, Novo Nordisk, IBM Corporation, Alphabet Inc (DeepMind), General Electric Company, Pfizer Inc., Johnson & Johnson, and Novartis AG.

Key Company Developments

• In April 2021, a new coronary imaging platform was developed using Artificial Intelligence by Abbott. It received CE mark by regulatory authorities in Europe.
• In October 2022, BioSymetrics, and Deerfield Management entered a five-year joint venture for accelerating the development of new therapeutics, keeping an initial focus on neurological and cardiovascular diseases. This strategic collaboration is intended to identify novel drug discovery programs which combine the AI powered target validation and discovery platform of BioSymetrics with modelling and drug discovery capabilities of Deerfield Management.
• In December 2022, SK Chemicals Co. Ltd., and Cyclica Inc. partnered to leverage AI in drug development and drug discovery. This collaboration was focused on developing therapies for a range of diseases. Under this alliance, the companies would deploy their proprietary drug discovery and development platforms to identify new drug candidates.

The Global AI in Pharmaceutical Market is Segmented as Below:

By Technology

• Context-Aware Processing
• Natural Language Processing
• Querying Method
• Deep Learning

By Application

• Drug Discovery
• Clinical Trial
• Research & Development
• Medical Imaging
• Others (Such as Epidemic Prediction)

By Region

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • France
  • Spain
  • U.K.
  • Italy
  • Russia
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • Southeast Asia
  • Rest of Asia Pacific
• Latin America
  • Brazil
  • Mexico
  • Rest of Latin America
• Middle East and Africa
  • GCC
  • South Africa
  • Rest of Middle East and Africa

Leading Companies

• GNS Healthcare
• Benevolent AI
• Berg Health
• Novo Nordisk
• IBM Corporation
• Microsoft Corporation
• Alphabet Inc (DeepMind)
• General Electric Company
• Pfizer Inc
• Johnson & Johnson
• Novartis AG
• Bristol-Myers Squibb Company