AI-based Medical Diagnostic Tools Market Outlook to Reach US$11.5 Bn by 2034, Driven by Increased Investment and Integration in Imaging – Latest Report by Transparency Market Research Inc.

Global AI-based Medical Diagnostic Tools Market Set for Explosive Growth at a CAGR of 20.8% Amid Rapid Technological Advancements and Rising Funding

The global AI-based medical diagnostic tools market, valued at approximately US$1.3 billion in 2023, is poised to surge at a robust CAGR of 20.8% from 2024 to 2034, reaching an estimated US$11.5 billion by the end of the forecast period.

Integrating artificial intelligence into medical diagnostics is revolutionizing clinical workflows by enabling precise, efficient, and non-invasive diagnoses. The influx of investor funding into AI start-ups and the rapid adoption of AI-powered systems in imaging modalities—such as X-rays and advanced brain tumor diagnostic tools—are accelerating market growth. Furthermore, companies are exploring AI-based remote medical devices for elderly care, allowing clinicians to deliver timely diagnostics from a distance.

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Analysts’ Viewpoint: Investment and Innovation Propel Market Expansion

A significant rise in global funding for AI start-ups is driving the integration of AI in diagnostic imaging. For instance, in March 2022, Qure.ai deployed AI for medical imaging diagnostics after raising US$40 million, while major investors like Anthropic and Microsoft continue to inject billions into AI innovations. These investments have paved the way for enhanced diagnostic precision and efficiency, reducing the time and cost associated with traditional drug development and diagnostic processes.

Moreover, AI is increasingly being incorporated into conventional imaging devices. Technologies such as Fujifilm’s CXR-AID, which identifies abnormal chest X-ray findings, exemplify how AI integration can significantly improve diagnostic accuracy. With these advancements, healthcare providers can now leverage AI to optimize clinical decision-making, thereby enhancing patient outcomes.

Market Introduction

The healthcare industry is witnessing a paradigm shift with the integration of AI-powered diagnostic tools designed to automate and enhance clinical workflows. These advanced systems support a range of applications—including radiology, cardiology, neurology, and oncology—by streamlining the interpretation of complex medical images and reducing diagnostic turnaround times. Amid a global shortage of in-person care providers, AI-driven diagnostic tools are emerging as essential solutions to address the increasing burden of chronic diseases.

Start-ups in this space have attracted substantial venture capital funding, as evidenced by Aidoc’s US$20 million Series B round in September 2020 and Arterys’ US$28 million Series C funding in May 2020. Such financial backing is fueling innovation and expanding the global footprint of AI-based diagnostic solutions.

Key Market Drivers

• Higher Funding for AI Start-ups
  Global investments in AI have reached unprecedented levels, with AI start-ups capturing a 21% share of venture capital investment in 2020. This trend has driven the demand for AI integration in diagnostic imaging, facilitating the rapid development of innovative tools.
• Example: Qure.ai’s deployment of AI for imaging diagnostics following a US$40 million fundraising round in March 2022.
• Increased Integration of AI into Imaging Devices
  The integration of AI into conventional imaging modalities—such as X-rays—enhances workflow efficiency, diagnostic accuracy, and operational precision. AI algorithms now enable the detection of subtle abnormalities that might otherwise be missed by the human eye.
• Example: Fujifilm’s CXR-AID chest X-ray program, certified by the PMDA in Japan, effectively identifies conditions like pneumothorax and chest nodules.

Regional Outlook

North America dominated the AI-based medical diagnostic tools market in 2023, driven by a high incidence of cancer and robust public and private investments in healthcare innovation. The U.S. and Canada continue to lead the adoption of AI-powered diagnostic solutions, supported by strategic initiatives and partnerships. For instance, in December 2021, Roche introduced three AI-based deep learning image analysis algorithms for breast cancer, while Arterys expanded its Cardio AI clinical app in April 2022. These initiatives are expected to reinforce North America’s leading market position throughout the forecast period.

Analysis of Key Players

The market is characterized by rapid technological innovation and strategic inorganic expansion. Leading companies in the AI-based medical diagnostic tools market include:

• Microsoft
• Nvidia Corporation
• Merative L.P.
• Alphabet, Inc.
• Intel Corporation
• Siemens Healthineers
• GE HealthCare
• Advanced Micro Devices, Inc.
• Koninklijke Philips N.V.
• InformAI

These companies are continuously investing in R&D and forming strategic partnerships to expand their diagnostic portfolios. For example, in June 2022, Bayer introduced Calantic Digital Solutions to aid radiologists with lesion detection and workload management, and in October 2021, Roche partnered with PathAI to develop an embedded image analysis workflow for pathologists.

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Market Segmentation

By Component:

• Software
• Services
• Hardware
• Memory
• Others (Network, etc.)

By Application:

• Radiology
• Cardiology
• Neurology
• Oncology
• Others (Ophthalmology, Gynecology, etc.)

By End-user:

• Hospitals
• Diagnostic Laboratories
• Others (Ambulatory Surgical Centers, etc.)

By Region:

• North America
• Europe
• Asia Pacific
• Latin America
• Middle East & Africa

By Countries Covered:

• U.S., Canada, Germany, U.K., France, Italy, Spain, China, India, Japan, Australia & New Zealand, Brazil, Mexico, South Africa, GCC

Frequently Asked Questions

• How big was the global AI-based medical diagnostic tools market in 2023?
  It was valued at US$1.3 billion in 2023.
• What is the forecast market value by 2034?
  The market is projected to reach US$11.5 billion by the end of 2034.
• What is the anticipated CAGR during the forecast period?
  The market is expected to grow at a CAGR of 20.8% from 2024 to 2034.
• What are the key factors driving the market?
  Key drivers include increased funding for AI start-ups and the integration of AI into imaging devices.
• Which end-user segment held the largest share in 2023?
  The diagnostics laboratories segment accounted for the largest share in 2023.
• Which region dominated the global market in 2023?
  North America was the dominant region in 2023.
• Who are the key AI-based medical diagnostic tools manufacturers?
  Prominent players include Microsoft, Nvidia Corporation, Merative L.P., Alphabet, Inc., Intel Corporation, Siemens Healthineers, GE HealthCare, Advanced Micro Devices, Inc., Koninklijke Philips N.V., and InformAI.

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