Artificial Intelligence in Drug Discovery Market – By Component (Software, Service), Technology (Machine Learning {Deep, Supervised}), Application Type (Target Identification, Preclinical Testing), Therapeutic Area, End-use, Global Forecast 2024 – 2032

AI in Drug Discovery Market Size

Artificial Intelligence in Drug Discovery Market size was valued at USD 1.9 billion in 2023 and is anticipated to grow at a CAGR of 29.6% from 2024 and 2032. High market growth can be attributed to a surge in investment and funding from venture capital firms, pharmaceutical companies, and government agencies. This influx of capital reflects growing interest and confidence in AI-driven technologies to expedite drug discovery processes, enhance efficiency, and address unmet medical needs.
 

In addition, collaboration is becoming increasingly prevalent in the market as companies seek to leverage complementary expertise, resources, and technologies. Furthermore, the increasing availability of healthcare data, such as genomics, proteomics, and clinical trial data, is providing a rich source of information for AI algorithms to analyze, further driving the adoption of AI in drug discovery. Moreover, the rising prevalence of chronic diseases and the need for innovative therapies are driving pharmaceutical companies to invest in AI technologies to stay competitive in the market.
 

Artificial Intelligence in Drug Discovery Market Trends

• The growing number of cross-industry collaborations and partnerships is a significant growth driver in the market. These collaborations bring together expertise, resources, and technologies from diverse sectors, fostering innovation, accelerating research, and advancing drug discovery efforts.
   
• Cross-industry collaborations enable stakeholders from different sectors, including pharmaceuticals, technology, academia, and healthcare, to pool their expertise and perspectives. Pharmaceutical companies bring domain knowledge in drug discovery, while technology providers contribute AI algorithms, data analytics capabilities, and computational resources.
   
• By combining diverse expertise, cross-industry collaborations enhance problem-solving capabilities and drive innovation in AI-driven drug discovery.
   
• For instance, in January 2019, Recursion Pharmaceuticals announced partnership with Takeda Pharmaceuticals. Within a span of fewer than 18 months, Recursion has assessed Takeda’s preclinical and clinical molecules across more than 60 indications. This evaluation has resulted in the identification of new drug candidates for 15 indications.
   
• Recursion's drug discovery platform, powered by AI, integrates extensive biological data generation on a large scale with cutting-edge machine learning capabilities. Thus, such partnership drives the AI drug discovery market by showcasing the transformative potential of AI technologies in accelerating the discovery of new therapeutics.
   

AI in Drug Discovery Market Analysis

Based on component, the market is segmented into software and services. The software segment held 68.3% revenue share in 2023 and is projected to grow at 29.4% CAGR during the forecast period.
 

• Increasing demand for advanced analytics and machine learning tools within the pharmaceutical industry is expected to propel the segmental growth.
   
• Furthermore, AI software tools enhance efficiency and automate multiple stages of the drug discovery workflow, resulting in reduced time and resource requirements, thereby fueling the adoption of AI software in drug discovery.
   
• Moreover, advancements in cloud computing and high-performance computing infrastructure have played a pivotal role in driving the adoption of AI software in drug discovery.
   

Based on technology, the AI in drug discovery market is classified into machine learning and other technologies. The machine learning segment is anticipated to witness substantial growth to reach USD 15.9 billion during the analysis time.
 

• Machine learning segment holds a substantial market share in the field of AI in drug discovery, driven by its ability to revolutionize various stages of the drug development process.
   
• Machine learning algorithms can analyze vast amounts of data, including biological, chemical, and clinical data, to identify potential drug candidates, predict their efficacy and safety profiles, and optimize clinical trial designs.
   
• Additionally, the increasing adoption of machine learning in drug discovery is supported by advancements in computational power, data availability, and algorithm development, further fueling its market growth.
   

Based on application type, the AI in drug discovery market is bifurcated into molecular library screening, target identification, drug optimization and repurposing, de novo drug designing, and preclinical testing. The molecular library screening accounted for USD 756.6 million in 2023 and is projected to witness growth at 29.3% from 2024 to 2032.
 

• AI algorithms enable high-throughput screening of large molecular libraries, allowing researchers to analyze thousands to millions of compounds rapidly. This efficiency accelerates the drug discovery process, reducing the time and resources required for identifying potential drug candidates. Thus, the adoption of AI for molecular library screening is increasing owing to these benefits.
   
• Furthermore, it can be easily integrated with AI-driven drug design approaches, such as de novo design maximizing the potential for discovering novel therapeutics with improved efficacy and safety profiles.
   

Based on therapeutic area, the AI in drug discovery market is divided into oncology, neurodegenerative diseases, inflammatory, infectious diseases, metabolic diseases, rare diseases, cardiovascular diseases, and other therapeutic areas. The oncology segment dominated the global AI in drug discovery market with 46% of market share in 2023.
 

• Increasing prevalence of cancer worldwide is a major factor contributing to the growth of this segment. For instance, according to International Agency for Research on Cancer (IARC) 2022 report showed 20 million new cancer cases and 9.7 million deaths globally, with lung and breast cancer being the most common type of cancers.
   
• Oncology represents an area with significant unmet medical needs, as cancer remains one of the leading causes of mortality worldwide. The unmet medical needs significantly increase the demand for more effective and targeted therapy. Thus, the complexity and heterogeneity of cancer require innovative approaches for drug discovery, thereby increasing the adoption of AI-driven solutions.
   

Based on end-use, the artificial intelligence in drug discovery market is categorized into pharmaceutical and biotechnology companies, contract research organization (CROs), and other end-users. The pharmaceutical and biotechnology companies segment held significant market share in 2023 and is expected to reach USD 10.2 billion by 2032.
 

• These companies have substantial financial resources, enabling them to invest significantly in AI technologies for drug discovery. Further, they are major contributors to research and development (R&D) in the healthcare industry.
   
• Additionally, they have access to vast amounts of data, including proprietary research and clinical trial data, which can be leveraged by AI algorithms to identify potential drug candidates more efficiently.
   
• Moreover, pharmaceutical and biotechnology companies often have established expertise in drug development, allowing them to integrate AI into their existing processes more seamlessly. As a result, these companies are at the forefront of adopting AI in drug discovery and contribute towards market growth.
   

North America held the largest share of 47.4% in 2023 and is set to witness substantial growth in the coming years.
 

• The region boasts a robust pharmaceutical industry, a strong presence of leading AI technology providers, and a supportive regulatory environment for innovation.
   
• Its commitment to fostering innovation through collaborations between academia, industry, and technology providers has bolstered its position in the AI in drug discovery market, driving growth and advancements in the field.
   

The U.S. artificial intelligence in drug discovery market in 2023 was valued at USD 823.6 million and is anticipated to grow at 29.1% CAGR.
 

• Increasing research funding, government initiatives promoting precision medicine in the U.S., and the adoption of AI-based tools in R&D for drug discovery among major pharmaceutical companies have further propelled the growth of this country.
   
• Furthermore, due to the advanced healthcare infrastructure, there is an early and proactive adoption of AI technology in this region, leading to a substantial presence in the market.
   

China's market for AI in drug discovery is poised for an impressive growth rate of 31.6% in the upcoming years.
 

• China boasts a vast and rapidly growing pharmaceutical industry that is increasingly leveraging AI to accelerate drug discovery processes, reduce costs, and improve success rates.
   
• Furthermore, rising incidence of chronic diseases and an aging population are driving the demand for new and more effective medications, further propelling the growth of the AI in drug discovery market in China.
   

India is set to lead the global artificial intelligence market in drug discovery, boasting a remarkable growth rate of 32.1%.
 

• The Indian government has been actively promoting AI and biotechnology through various initiatives and funding programs, aiming to transform the country into a global hub for technological innovation.
   
• Additionally, the increasing number of AI startups and tech companies focusing on healthcare solutions is spurring innovation and creating a dynamic ecosystem for AI-driven drug discovery.
   

AI in Drug Discovery Market Share

Prominent players involved in the market include IBM Corporation, NVIDIA Corporation, Microsoft Corporation, Exscientia and several other local and regional players. These industry players are constantly involved in creating new opportunities in the drug discovery sector. They focus on strategic collaborations, acquisitions, partnerships, mergers, service launches, etc. to maintain their position in the market and secure the highest market share and outperform the competition.
 

For instance, in February 2023, Microsoft and 1910 Genetics, a biotechnology company advancing small and large molecule drug discovery with a multimodal AI platform, announced a new five-year commercial agreement and go-to-market collaboration to harness advanced AI and next generation high-performance computing (HPC). The collaboration aimed to increase the R&D productivity by combining 1910’s massive computational and wet lab biological data, robotics-driven laboratory automation and multimodal AI models for drug discovery with Microsoft Azure Quantum Elements. Such strategies help the market players maintain their position in the market.
 

AI in Drug Discovery Market Companies

Key players operating in the artificial intelligence in drug discovery industry include:

• Alphabet Inc. (DeepMind)
• Atomwise Inc.
• BenevolentAI
• Cyclica
• Deep Genomic
• Deargen Inc.
• Exscientia
• International Business Machines Corporation
• Microsoft Corporation
• NVIDIA Corporation
   

Artificial Intelligence in Drug Discovery Industry News:

• In September 2023, BenevolentAI, signed a strategic collaboration with Merck to leverage BenevolentAI's powerful end-to-end AI platform capabilities to accelerate drug discovery and development processes. Through this collaboration, Merck aimed to gain access to an expert team of interdisciplinary drug discovery scientists from BenevolentAI to identify and develop innovative compounds across various therapeutic areas such as neurology, oncology, and immunology. This strategy is expected to expand company’s development sector.
   
• In June 2022, Cyclica and Oncocross, announced a partnership to develop therapeutics in oncology. The collaboration initially focused on discovery and developing treatments for Myelofibrosis, with plans to expand to additional oncology areas. This partnership offered promising outcomes for the future of oncology medications.
   

The artificial intelligence in drug discovery market research report includes an in-depth coverage of the industry with estimates & forecast in terms of revenue in USD Million from 2018 – 2032 for the following segments:

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Market, By Component

• Software
• Services

Market, By Technology

• Machine learning
  • Deep learning
  • Supervised learning
  • Unsupervised learning
  • Other machine learning technologies
• Other technologies

Market, By Application Type

• Molecular library screening
• Target identification
• Drug optimization and repurposing
• De novo drug designing
• Preclinical testing

Market, By Therapeutic Area

• Oncology
• Neurodegenerative diseases
• Inflammatory
• Infectious diseases
• Metabolic diseases
• Rare diseases
• Cardiovascular diseases
• Other therapeutic areas

Market, By End-use

• Pharmaceutical and biotechnology companies
• Contract research organization (CROs)
• Other end-users

The above information is provided for the following regions and countries:

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • UK
  • France
  • Spain
  • Italy
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • Australia
  • South Korea
  • Rest of Asia Pacific
• Latin America
  • Brazil
  • Mexico
  • Rest of Latin America
• Middle East and Africa
  • South Africa
  • Saudi Arabia
  • Rest of Middle East and Africa