Artificial intelligence (AI) has transformed numerous industries, including pharmaceuticals. It has revolutionized various aspects of the pharmaceutical industry, particularly drug discovery, clinical trials, and personalized medicine, by leveraging advanced computing techniques such as machine learning, deep learning, and natural language processing (NLP).

The transformative potential of AI in drug discovery is evident through the emergence of several late-stage AI-discovered candidates, including BXCL501 by BioXcel Therapeutics, XF-02 by Xbiome, and INS018_055 by Insilico Medicine.

According to Biotech Forecasts, the Global Artificial intelligence (Ai) in the pharmaceutical Market was valued at USD 1,490.08 million in 2022 and is estimated to reach USD 9,441 million by 2030, registering a CAGR of 19.6% from 2023 to 2030.

Factors that drive the market growth involve:

(1) Surging Investment in AI for Pharma:

Venture capital investment in AI-driven biotech companies is experiencing substantial year-over-year growth. In 2021, it reached USD 2,685 million, marking a 46% increase from USD 1,447 million in 2020. Notably, Xtalpi and Insitro secured impressive funding of USD 400 million each in their Series D and Series C funding rounds, respectively. This surge can be attributed to factors such as the rising demand for AI-based services and the impact of the COVID-19 pandemic, which has redirected venture capital investment towards the healthcare IT sector.

Venture capital investment in the global AI in the pharmaceutical market (US$ Million), 2018 to 2021.

Source: Biotech Forecasts

(2) Increasing M&A and collaboration deals:

The growing potential of AI in the pharmaceutical sector has led to a rise in M&A and collaboration deals between major pharma companies and AI-driven biotech firms. For instance, in February 2023, Takeda completed the acquisition of Nimbus Lakshmi, a wholly-owned subsidiary of Nimbus Therapeutics, for a remarkable $6 billion, including the AI-discovered candidate NDI-034858. Similarly, in January 2022, Sanofi engaged in a $5 billion collaboration deal with Exscientia to jointly develop 15 AI-based small molecule candidates across oncology and immunology.

Ai in Pharma Key Collaboration deals in 2022

Source: Biotech Forecasts

Other factors that fuel the market growth involve the growing incidence of chronic diseases, strong government support for AI initiatives, and a rising demand for AI-based solutions in drug discovery and development.

Application of AI in Pharmaceutical:

Artificial intelligence (AI) in the pharmaceutical industry finds applications in various critical areas, including drug discovery, clinical trial research, research and development, medical imaging, and other domains such as epidemic prediction.

Ai in Pharma Market Share by Application in 2022

Source: Biotech Forecasts

The drug discovery and development segment is expected to account for the largest share of AI in the pharmaceutical market, driven by the need to reduce the time and cost of bringing new drugs to market.


In conclusion, artificial intelligence (AI) is revolutionizing the pharmaceutical sector. It accelerates drug discovery, clinical trials, research, and even predicting disease outbreaks. AI not only makes drug development faster but also creates personalized treatments that help patients. As AI keeps getting better, it will make healthcare and medicine more efficient, cost-effective, and innovative.

Unlock the Full Document Here

To get a Free Report Sample, or if you have any questions please contact: [email protected]