Yiannis Mouratidis – Contributor, Science
Different universes converge in the path of AI-based drug developmentDEEP KNOWLEDGE VENTURES
A recent article about AI-based drug development, indicates the progressive use of A.I. technologies for the drug production industry, mining the huge amount of data collected from the pharmaceutical companies’ data centers. Thanks to Deep Knowledge Ventures which a couple of days ago updated their research data, we took the opportunity to delve into the latest developments of this market.
In the combined capitalization graph the BioPharma Industry seems to run a period of sluggish growth, while the IT & Tech industries are more active. This is important because it means that drug development nowadays derives from quite different sources than in the past. It certainly does not mean that Pharma Corporations stay out of the game as we can see in the graph of leading companies with hard investing sectors in AI for health care and new drugs development.
BioPharma Industry seems to run a period of sluggish growth, while the IT & Tech industries are more active.
From the ordinary people’s point of view, the news is mostly good because both traditional BioPharma and IT companies focus on the same field of therapies, like cancer, dementia and rear diseases. However, practically, most AI for Drug Discovery startups will eventually have to focus on a very specific niche or one type of a disease. Broader approaches and end-to-end solutions will be affordable only for very strong AI companies. Although over 120 startups are working in AI for Drug Discovery, only about 20 companies are in the top tier level.
According to Margaretta Colangelo, Partner, Deep Knowledge Ventures, in 2019 and 2020 there will be intense competition between BioPharma and technology companies to attract AI experts and to acquire assets including new technologies and startups. This will be similar to the previous intense competition between technology companies back in 2014 – 2016 which also turned to the best AI assets and resources.
The U.S. leads the market
It is crystal clear that the U.S. with 59% of the total number of companies that use AI for drug development is the race leader, while the EU and Asia seem, for now at least, to have stuck in the start-line. However the Deep Knowledge Analytics research anticipates an aggressive increase of investments in Asia-Pacific, mainly into foreign companies (largely US-based companies) and the projection is that in the coming years we will witness a considerable proliferation of relevant companies located in Asia – Pacific and in China particularly.
The US leads the way in AI-based drug development, while Europe without the UK needs a leap to close the gap.
The current picture leaves Europe off the charts, given that the U.K. which holds the second bigger percentage after the U.S. will no longer be a member state of the E.U. From the European group, only Germany and Switzerland steam the European engine. This situation is about to change with the Horizon Europe research program, that is the successor of Horizon 2020. It starts in 2021 with a €94,1 billion investment, still debatable if it amounts to €160 billion. Last October, the E.U. called the member states to decide whether to back 10 options for future industry partnerships. Two of which ‘Health innovation, for the rapid development, deployment and safe use of medical treatments, devices and technologies enhanced by digital technologies’ and ‘Key digital technologies, including novel technologies such as AI and linking to downstream sectors’, are both strong supporters of AI research technology and they will claim a portion of the Horizon Europe project, which is translated into $1-2 billion, for each competitor. Even if AI is not a ‘moonshot’ of the Horizon Europe, it is highly possible that this will change, because almost 50% of the program is not yet attached to big missions. However, all the ‘moonshot’ programs need AI to be successful. So, some AI sub-projects will absorb a considerable part of the budgets available.
We are facing an exponential phase
According to the Deep Knowledge Ventures report, from $200 million in 2015, the market reached $700 million in 2018 and is expected to value more than $5 billion in 2024. Some other studies raise the bar for 2024 to $10 billion. That means a staggering 40% compound annual growth rate (CAGR) between 2017 and 2024, in the sectors of medical imaging, diagnostics, personal AI assistants, drug discovery, and genomics.
Even if it is expected that the U.S. will still be at the forefront of medical innovation there is solid evidence that Asia and Europe will speed up the development rate. According to the most recent news, The European Investment Bank agreed a €30 million facility to support investment by Dublin based biotech company, Nuritas, to further increase and accelerate development of artificial intelligence and DNA analysis to improve global healthcare. Last May, Sanofi signed a deal with Exscientia, for a potential €250 million collaboration and license option deal to discover bispecific small-molecule drugs against metabolic diseases. Scotland-based Exscientia will employ the AI platform and its automated design capabilities to spot comb