Biopharmaceutical Artificial Intelligence (AI) Market – Forecast (2025-2030)

Overview

The Biopharmaceutical Artificial Intelligence (AI) market size is forecast to reach USD 26,059.45 million by 2033, after growing at a CAGR of 30.20% during 2025-2033. The growth of AI in the biopharmaceutical market is the increasing collaboration between biopharma companies and AI technology providers. With approximately 800 companies currently applying AI to drug discovery and development, many of these are offering a range of services, such as software as a service (SaaS), custom data science services, drug discovery solutions, and clinical trial support. These collaborations enable biopharma companies to leverage cutting-edge technologies and expertise, accelerating their AI initiatives and enhancing their research and development capabilities.

Report Coverage

The report “Biopharmaceutical Artificial Intelligence (AI) Market– Forecast (2025-2030)”, by IndustryARC, covers an in-depth analysis of the following segments of the biopharmaceutical artificial intelligence (AI) market.

Offering: Hardware, Software, Service.

Deployment Type: Cloud, On Premises.

Technology: Machine Learning, Natural Language Processing, Deep Learning, Other Techniques.

Application: Business Processes & Supply Chain, Drug Discovery, Medical Imaging Diagnostics, Precision Medicine.

End User:  Manufacturer, Contract Research Institutions, Academic and Government Research Institutions.

By Geography:  North America, South America, Europe, Asia-Pacific, RoW

Key Takeaways

•    For instance, in October 2024, Accenture, through Accenture Ventures, invested in 1910 Genetics, a biotechnology company specializing in small and large-molecule drug discovery using a multimodal AI platform integrated with laboratory automation. This partnership will enable Accenture and 1910 Genetics to collaborate on tailored solutions and scalable infrastructure, supporting biopharma customers in accelerating drug target identification, lowering costs, and delivering more effective and affordable therapies to patients.

•    In May 2022, AstraZeneca highlighted a significant milestone in its collaboration with BenevolentAI, a UK-based leader in AI-driven drug discovery. The partnership, which began in 2019, led to the discovery of a second pulmonary fibrosis target, marking the third novel target identified by BenevolentAI for AstraZeneca. Just months later, in October 2022, BenevolentAI delivered two additional AI-generated targets for AstraZeneca, focusing on chronic kidney disease and idiopathic pulmonary fibrosis. These collaborations underscore the increasing reliance on AI technologies to uncover innovative therapeutic targets in areas of high unmet medical need.

•    In November 2022, Cyclica received a $1.8 million grant from the Bill & Melinda Gates Foundation to apply AI-powered technology to discover non-hormonal contraceptives. This project exemplifies how AI can be harnessed to explore new therapeutic avenues in areas with limited data, a key strategy in the evolving landscape of AI-driven drug discovery.

By Offering- Segment Analysis

Software dominated the biopharmaceutical artificial intelligence (AI) market in 2024. Software solutions are being developed to optimize clinical trial design, predict patient responses, and streamline regulatory approvals. Companies like Pfizer are partnering with AI-first biotech firms to integrate these advanced software tools into their R&D processes. Generative AI models, like AlphaFold2 and ESMFold, are transforming the understanding of protein structures, which is vital for identifying new drug targets. Advanced analytics and machine learning algorithms are also being increasingly integrated into biopharma workflows, facilitating improved decision-making and faster time-to-market for new drugs.

Clinical trial designs are driving the biopharmaceutical AI software market. For instance, with collaborations like BenevolentAI and Qure.ai, AstraZeneca employs AI to develop treatments for chronic kidney disease and pulmonary fibrosis. It is anticipated that more and more companies will use AI software to support adaptive clinical trial designs, which allow for real-time adjustments to factors like dose, sample size, or trial arms depending on interim data. This will contribute to global biopharmaceutical AI market growth.

By Deployment Type- Segment Analysis

Cloud segment dominated the biopharmaceutical artificial intelligence (AI) market in 2024. The biopharmaceutical sector is rapidly adopting cloud technology. Embracing the cloud and pursuing a cloud-first strategy are crucial steps toward future-proofing BioPharma processes and realizing AI's full promise. Between January 2022 and June 2023, Pfizer introduced about 19 medical medicines, including vaccines, with digital data and AI helping to accelerate the market entry of 13 of these. Pfizer's collaboration with Amazon Web Services (AWS), which began in 2019 with the creation of a dedicated scientific data cloud (SDC), has been critical to its success. According to Pfizer, the cloud allows scientists to quickly access historical molecule and compound data, which used to take weeks or months.

The combination of technology, rapid processing, and increasing databases creates unprecedented prospects for the global biopharmaceutical AI market. For example, in November 2024, NVIDIA launched BioNeMo to scale digital biology for the global biopharmaceutical and scientific industries.  Global system integrators, software providers, and cloud service providers such as Accenture, AWS, and Deloitte are bringing NVIDIA BioNeMo Blueprints to enterprises worldwide. The pioneering biotech companies, techbio researchers, and AI platform companies and organizations will contribute to the open-source framework.

By Technology- Segment Analysis

Natural Language Processing dominated the biopharmaceutical artificial intelligence (AI) market in 2024. NLP helps researchers sift through vast amounts of scientific literature and clinical trial reports to uncover patterns, identify potential drug candidates, and explore new therapeutic areas. It accelerates the process of drug discovery by enabling faster literature mining and hypothesis generation. NLP tools can automate the extraction of relevant patient data from clinical records, improving patient recruitment, optimizing trial designs, and monitoring real-time results. This reduces costs and time involved in clinical trials and enhances decision-making. By analyzing clinical notes, genetic data, and other unstructured text, NLP technologies can assist in developing personalized treatment plans based on individual patient profiles. This trend aligns with the shift toward precision medicine, where treatments are tailored to specific genetic markers, conditions, and patient histories.

By Application- Segment Analysis

Drug Discovery dominated the biopharmaceutical artificial intelligence (AI) market in 2024. AI-powered drug discovery platforms are altering the landscape by accelerating the design and development of new therapies. For example, Pfizer has adopted AI by collaborating with Tempus, CytoReason, and Gero to incorporate it into drug discovery, clinical trials, and patient population analysis. companies such as Exscientia have demonstrated the power of AI in medication design. According to Coherent Solutions, agreements focusing on AI-driven drug discovery have increased dramatically, from 10 in 2015 to 105 by 2021, reflecting the company's expanding significance.

In November 2023, Tempus, a leader in AI and precision medicine, announced a multi-year, strategic collaboration with Recursion, a leading clinical stage techbio company decoding biology to industrialize drug discovery. The 2 companies are working together to advance biomarker-driven therapeutic development with a data-first approach. As part of the agreement, Recursion will make annual payments to Tempus up to $160M in aggregate over the next 5 years.

By End User- Segment Analysis

Contract Research Institutions dominated the biopharmaceutical artificial intelligence (AI) market in 2024. The discovery of new and more advanced modalities, such as mRNA, cell and gene treatments, or antibody-drug conjugates (ADCs), leads to the emergence of specialist businesses that are appealing acquisition targets for established CDMOs wishing to enhance present capabilities. For example, Pfizer acquired Seagen, and AbbVie purchased Immunogen, both of which indicate an increase in contract research agreements. Novo Nordisk purchased Catalent, which is another significant acquisition in the CDMO industry.

Also, Contract Research Organizations (CROs) are implementing AI to improve their service offerings. AI is being used to handle data, recruit patients, and oversee clinical trials. As multinational pharmaceutical businesses outsource more R&D labor, CROs increasingly utilize artificial intelligence.

By Geography - Segment Analysis

North America dominated the Biopharmaceutical Artificial Intelligence (AI) market in 2024. The AI in Biopharmaceuticals Market in North America is growing rapidly due to the region's advanced healthcare infrastructure, significant R&D investments, and widespread adoption of cutting-edge technologies. North America, particularly the United States and Canada, hosts some of the world’s largest biopharmaceutical companies and AI technology firms, creating a synergistic environment for innovation. AI is transforming drug discovery, clinical trials, and personalized medicine, significantly reducing costs and time to market while enhancing patient outcomes.

In March 2023, NVIDIA introduced an expanded suite of generative AI cloud services under its AI Foundations, including the BioNeMo™ Cloud. This service accelerates drug discovery by enabling researchers to train and fine-tune AI models on proprietary data, optimize protein and therapeutic development, and conduct genomics, chemistry, and biology research. BioNeMo™ Cloud supports seamless AI model inference through web browsers and cloud APIs for easy integration into existing workflows.

Drivers – Biopharmaceutical Artificial Intelligence (AI) Market

•    Venture Capital Drives AI Growth in Biopharma - MegaRobo and ConcertAI Secure Major Funding
Despite global economic challenges and political uncertainties in 2022, sectors like drug discovery and biotech continued to evolve, offering critical solutions to pressing health challenges. These fields, particularly AI-driven biotech and drug discovery companies, attracted significant investment from venture capitalists (VCs) looking to capitalize on innovation in the life sciences. In this context, several noteworthy companies raised substantial funding rounds in 2022, signaling a growing interest in the application of AI in biopharmaceuticals.

In June 2022, Goldman Sachs led a remarkable $300 million funding round for MegaRobo Technologies, a Beijing-based startup specializing in CRISPR gene editing and the integration of artificial intelligence with robotics to enhance laboratory efficiency. 
In March 2022, ConcertAI, a leader in AI and real-world data (RWD) solutions for the life sciences and healthcare sectors, successfully closed a $150 million Series C round, bringing its total valuation to $1.9 billion. Over the past three years, ConcertAI has expanded its customer base to over 45 life sciences companies and contract research organizations (CROs), providing SaaS solutions that span the entire product lifecycle. These solutions have supported nearly 40 new product launches, improved time on therapy by 10%, and reduced clinical trial design and execution times by up to 25%. 

•    Driving AI Innovation in Drug Discovery-M&A Activity and Tech Giants Leading the Way

The AI-driven drug discovery and development sector has been evolving for over a decade, and in recent years, the market has seen clear signs of consolidation. Over the past six years alone, more than 30 mergers and acquisitions (M&A) have taken place in this space, highlighting the growing importance of AI in transforming the biopharmaceutical industry.

•    2020: Insitro acquired Haystack Biosciences, expanding its AI-driven drug development platform.
•    2021: Genentech acquired Prescient Design, further advancing its AI capabilities in precision medicine.
•    2022: Ginkgo Bioworks acquired Zymergen for $300 million, strengthening its synthetic biology and AI integration.
•    2023: BioNTech acquired InstaDeep for $549 million, leveraging AI in drug discovery and vaccine development. Additionally, Recursion

Pharmaceuticals acquired Cyclica and Valence Labs for a combined total of around $90 million, enhancing its AI-driven drug discovery platform.
In addition to these acquisitions, the growing involvement of big tech giants in life sciences has fueled further consolidation in the AI drug discovery space. Companies like NVIDIA, Alphabet, and Microsoft are leveraging their cutting-edge AI research, world-class tech infrastructure (cloud computing, software, and computational power), and flexible business models to drive innovation in biopharmaceuticals.
Challenges – Biopharmaceutical Artificial Intelligence (AI) Market

•    Complex Regulatory Environment

One of the key challenges for AI in the biopharmaceutical market is navigating the complex and often slow regulatory environment. The biopharma industry is highly regulated, with strict guidelines set by agencies such as the FDA in the U.S., EMA in Europe, and other global regulatory bodies. These regulations govern the development, approval, and commercialization of new drugs and medical technologies.  This requirement frequently results in longer and more expensive AI development in the pharmaceutical industry. Pharmaceutical companies should partner with regulators to simplify this process for everyone's benefit. By embracing AI and other digital transformation initiatives, both regulators and companies can enhance the effectiveness and value of regulatory operations.

Market Landscape

Technology launches and R&D activities are key strategies adopted by players in the biopharmaceutical artificial intelligence (AI) market. In 2024, Major players in biopharmaceutical artificial intelligence (AI) are Microsoft Corporation, Amazon Web Services, IBM, Google LLC, NVIDIA Corporation, Tencent, Amgen Inc., PathAI, Owkin, Insilico, among others.

Developments:

•  In March 2023, NVIDIA introduced an expanded suite of generative AI cloud services under its AI Foundations, including the BioNeMo™ Cloud. This service accelerates drug discovery by enabling researchers to train and fine-tune AI models on proprietary data, optimize protein and therapeutic development, and conduct genomics, chemistry, and biology research. BioNeMo™ Cloud supports seamless AI model inference through web browsers and cloud APIs for easy integration into existing workflows.
•   In March 2022, ConcertAI, a frontrunner in AI and real-world data (RWD) solutions for the life sciences and healthcare industries, completed a successful $150 million Series C funding round, increasing its total valuation to $1.9 billion. Over the past three years, ConcertAI has expanded its customer base to over 45 life sciences companies and contract research organizations (CROs), providing SaaS solutions that span the entire product lifecycle
   

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