AI in Pharma and Biotech Market Outlook to Reach US$13.1 Bn by 2034, Driven by Speedy Drug Development and Gene Editing Advancements – Latest Report by Transparency Market Research Inc.

Global AI in Pharma and Biotech Market Set for Explosive Growth at a CAGR of 18.8% Amid Rapid Drug Discovery and Clinical Trial Innovations

The global AI in pharma and biotech market, valued at approximately US$1.8 billion in 2023, is projected to expand at a remarkable CAGR of 18.8% from 2024 to 2034, reaching an estimated US$13.1 billion by the end of the forecast period.

Integrating artificial intelligence into pharmaceutical and biotechnology processes is revolutionizing drug discovery and development. With only one out of 5,000–10,000 compounds typically progressing to potential drugs, AI’s capacity to dramatically reduce costs and expedite the drug development timeline is becoming indispensable. Leading market players are now incorporating clinical trial simulation platforms and advanced prediction models to fast-track clinical trials, thereby enhancing patient outcomes and reshaping the future of therapeutic production.

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Analyst Viewpoint: Accelerating Drug Discovery and Clinical Innovation with AI

The global AI in pharma and biotech market is expected to gain significant momentum, driven by the urgent need for speedy drug development and the advent of genome editing technologies powered by AI. AI tools facilitate virtual screening, epitope selection, and binding prediction, accelerating the discovery of vaccines and therapeutics. Moreover, these technologies enable pharmaceutical companies to work on multiple complex drug workflows simultaneously, streamlining processes from molecular engineering to sequencing and validation.

However, despite its transformative potential, AI faces challenges such as limited creative insight compared to experienced researchers and occasional gaps in assay metadata. Overcoming these hurdles will be key to unlocking AI’s full potential in the pharma and biotech sectors.

Market Introduction

The integration of AI into pharma and biotech is set to fortify the healthcare vertical by optimizing experimental designs and accelerating the virtual screening process. AI-driven platforms support diversified testing, leading to faster identification of impactful targets and significantly shortening the drug discovery cycle. The promise of producing over 50% of drugs using AI by 2030 underscores the transformative impact of these technologies on the industry.

Key Market Drivers

• Need for Speedy Drug Development
  The traditional drug discovery process is highly time-consuming and costly. AI tools streamline the sorting and cross-referencing of billions of molecular designs, significantly reducing the time required for hypothesis verification and subsequent therapeutic development. This rapid processing capability is critical in expediting drug approvals and reducing overall research expenditures.
• Advancements in Gene Editing through AI
  AI is instrumental in enhancing genome editing techniques such as CRISPR-Cas9. Machine Learning algorithms analyze extensive genetic sequence datasets to predict off-target effects and optimize gene structure editing. This precision not only paves the way for novel therapeutic strategies but also accelerates the development of personalized medicine approaches, particularly in complex diseases like cancer.

Regional Outlook

North America continues to lead the AI-driven pharma and biotech landscape, bolstered by robust governmental support and extensive adoption of precision medicine initiatives. The U.S. and Canada are at the forefront of fostering cross-border partnerships and establishing AI centers of excellence. For instance, in March 2022, Insilico Medicine collaborated with EQRx to enhance de novo small molecule design, while Amazon Web Services partnered with Pfizer in December 2021 to develop cloud-based clinical trial solutions. Furthermore, Sanofi’s AI Center of Excellence, launched in Toronto in June 2022, exemplifies the region’s commitment to leveraging AI for advanced therapeutic development.

Analysis of Key Players

The market is characterized by rapid technological innovation and strategic collaborations. Key participants in the AI in pharma and biotech market include:

• BenevolentAI SA
• Insilico Medicine
• Recursion Pharmaceuticals
• Atomwise Inc.
• Berg LLC
• Cloud Pharmaceuticals
• Deep Genomics
• Exscientia
• Schrödinger
• twoXar, Inc.
• Insitro

These companies are actively investing in expanding their AI capabilities through both organic growth and strategic partnerships. In October 2023, Recursion, in collaboration with Genentech and Roche, validated a hit series for targeted diseases, launching a Small Molecule Validation Program Option by Roche. Similarly, in September 2023, Exscientia entered a multi-year collaboration with Merck KGaA to combine AI-driven precision drug design with cutting-edge neuroinflammation and oncology research.

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Market Segmentation

By Application:

• Drug Discovery and Development
• Clinical Trials and Optimization
• Predictive Maintenance and Quality Control
• Drug Target Identification
• Disease Diagnosis & Prognosis
• Others

By End-User:

• Pharmaceutical & Biotech Companies
• Academic & Contract Research Organizations
• Others

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 in pharma and biotech market in 2023?
  It was valued at US$1.8 billion in 2023.
• What is the forecast market value by 2034?
  The market is projected to reach US$13.1 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 18.8% from 2024 to 2034.
• What are the key factors driving the demand for AI in pharma and biotech?
  The primary drivers include the need to reduce time in drug development and advancements in gene structure editing using AI.
• Which end-user segment held the largest share in 2023?
  The pharmaceutical & biotech companies segment accounted for the largest share in 2023.
• Which region dominated the global AI in pharma and biotech market in 2023?
  North America was the dominant region in 2023.
• Who are the key AI in pharma and biotech manufacturers?
  Prominent players include BenevolentAI SA, Insilico Medicine, Recursion Pharmaceuticals, Atomwise Inc., Berg LLC, Cloud Pharmaceuticals, Deep Genomics, Exscientia, Schrödinger, twoXar, Inc., and Insitro.

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