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Is pharma AI on the brink of an investment boom?

Is the pharma sector seeing the beginnings of an AI investment boom?
Image credit: www.iqlect.com

The pharma industry is seeing an increase in artificial intelligence (AI) investment across several key metrics, according to an analysis of GlobalData data.

AI is gaining an increasing presence across multiple sectors, with top companies completing more AI deals, hiring for more AI roles and mentioning it more frequently in company reports at the start of 2021.

GlobalData’s thematic approach to sector activity seeks to group key company information on hiring, deals, patents and more by topic to see which companies are best placed to weather the disruptions coming to their industries.

These themes, of which AI is one, are best thought of as “any issue that keeps a CEO awake at night”, and by tracking them it becomes possible to ascertain which companies are leading the way on specific issues and which are dragging their heels.

According to this method, Novartis, GlaxoSmithKline, Merck & Co are classed as dominant players in AI in the sector, with an additional 19 companies classified as leaders. 10 companies are considered to be vulnerable due to a lack of investment in AI.

One area in which there has been some increase in AI investment among pharma companies is in the number of deals. GlobalData show that there were 44 AI deals in pharma in the first quarter of 2019. By the first quarter of 2021, that number was 85.

Hiring patterns within the pharma sector as a whole are pointing towards an increase in the level of attention being shown to AI-related roles. There was a monthly average of 955 actively advertised-for open AI roles within the industry in April this year, up from a monthly average of 712 in December 2020.

It is also apparent from an analysis of keyword mentions in financial filings that AI is occupying the minds of pharma companies to an increasing extent.

There have been 1,346 mentions of AI across the filings of the biggest pharma companies so far in 2021, equating to 12.1% of all tech theme mentions. This figure represents an increase compared to 2016, when AI represented 4.8% of the tech theme mentions in company filings.

AI is increasingly fueling innovation in the pharma sector, particularly in the past six years. There were, on average, 16 pharma patents related to AI granted each year from 2000 to 2014. That figure has risen to an average of 49 patents since then, reaching 75 in 2020.

Reference