Biosimulation Market Size Report | Trends, Growth Drivers & Share 2030

[Research Report] The biosimulation market size was US$ 3.22 billion in 2022, and the biosimulation market size is projected to reach US$ 10.09 billion by 2031. It is expected to register a CAGR of 15.3% in 2022-2031.

Market Insights and Analyst View:

Biosimulation, also known as modeling and simulation, uses computer simulations of biological processes to predict the behavior of biological systems during research & development activities. These are mathematical simulations to replicate the biological systems, processes, and dynamics. The increase in R&D activities for the development of drugs, the use of technologically advanced products for drug discovery and drug development, and the use of AI and machine learning for the development of drugs are fueling the growth of the biostimulation market. Also, the introduction of biostimulation in pharmaceutical and biotechnology companies is driving the growth of the biosimulation market.

Growth Drivers:

The pharmaceutical industry is one of the most R&D-intensive industries globally. The value of medicines is becoming increasingly important as pharmaceutical companies are keen to ensure that R&D achieves their intended goal. Over the last decade, the number of new drugs approved yearly has also increased. The Food and Drug Administration (FDA) approved 37 new drugs annually in 2022. Efforts are being made to achieve greater effectiveness and efficiency in fulfilling patients' needs. The research-based industry allocates ~15–20% of revenues to R&D activities and invests more than US$ 50 billion in R&D annually. Globally, the US is a leading country in R&D investments, producing over half of the world’s new molecules in the past decade. R&D is a significant and essential part of the business of pharmaceutical companies as it enables them to come up with new molecules for various therapeutic applications with significant medical and commercial potential.

R&D Investments by Major Pharmaceutical Companies

Note: The current conversion rate is considered for presenting the currencies.

Source: Annual Reports and The Insight Partners Analysis

R&D expenditure is done to discover, examine, and produce new products, make upfront payments, improve existing outcomes, and demonstrate product efficacy and regulatory compliance before launch. The R&D investments differ as per the need and demand for clinical trials. The cost includes materials, supplies used, and salaries, along with the cost of developing quality control.

Clinical trials help determine if a new form of treatment or prevention, such as a new drug, diet, or medical device, is safe and effective. The trials are mainly carried out during drug development. According to the data provided by the National Library of Medicine (NLM), ~52,000 new studies were registered with NLM (ClinicalTrials.gov) in 2021, which increased to ~58,000 in 2023. In January 2023, the NLM reported 38,837 active clinical trials in the US and 105,172 active trials worldwide. According to the European Medicine Agency, in the European Union (EU), ~4,000 clinical trials are authorized annually, of which about 60% of clinical trials are associated with the pharmaceutical industry.

Further, clinical trials are increasingly becoming complex procedures, owing to which proper execution and overseeing of the operation occurring in research-based organizations has become crucial. To avoid errors due to improper execution, research-based organizations are outsourcing clinical trials to develop their products. The increasing number of clinical trials for the development of drugs using simulation software and growing investment in pharmaceutical R&D activities is fueling the growth of the market.

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Biosimulation Market: Strategic Insights

Biosimulation Market

• Market Size 2023
  US$ 3.71 Billion
• Market Size 2031
  US$ 11.60 Billion

Market Dynamics

GROWTH DRIVERS

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FUTURE TRENDS

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OPPORTUNITIES

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Regional Overview

• North America
• Europe
• Asia-Pacific
• South and Central America
• Middle East and Africa

Market Segmentation

Product Type

• Software
• Services

Application

• Drug Discovery
• Preclinical and Clinical Drug Development

End Users

• Pharmaceutical and Biotechnology Companies
• Research Institutes
• Contract Research Organizations

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Report Segmentation and Scope:

The “Global Biosimulation Market” segmentation is done on the basis of product type, application, end-user, and geography. Based on product type, the biosimulation market is segmented into software and services. Services are further sub-segmented into in-house services and contract services. Based on application, the biosimulation market is segmented into preclinical and clinical drug development, drug discovery, and others. Based on end users, the biosimulation market is segmented into pharmaceutical & biotechnology companies, research institutes, contract research organizations, and others. The biosimulation market based on geography is segmented into North America (US, Canada, and Mexico), Europe (Germany, France, Italy, UK, Russia, and the Rest of Europe), Asia Pacific (Australia, China, Japan, India, South Korea, and the Rest of Asia Pacific), Middle East & Africa (South Africa, Saudi Arabia, UAE, and the Rest of Middle East & Africa), and South & Central America (Brazil, Argentina, and the Rest of South & Central America).

Segmental Analysis:

Based on product type, the biosimulation market is segmented into software and services. Services are further sub-segmented into in-house services and contract services. In 2022, the software segment held the largest market share of the biosimulation market by product type. However, the services segment is expected to grow at the highest CAGR during the forecast period. Biosimulation software enables researchers to model and simulate complex biological systems, aiding in the prediction of drug behavior, optimization of treatment strategies, and reduction of costs and time associated with traditional experiments. Biosimulation solutions facilitate collaboration, data integration, and regulatory compliance, empowering scientists to make informed decisions, accelerate drug development, and improve patient outcomes.

Based on end users, the biosimulation market is segmented into pharmaceutical & biotechnology companies, research institutes, contract research organizations, and others. In 2022, the pharmaceutical & biotechnology companies segment held the largest biosimulation market share. However, the contract research organizations segment is expected to grow at the highest CAGR during the forecast period. Clinical research organizations (CROs) assist in successfully implementing clinical trials through the services offered using high-quality facilities and deep subject matter expertise. CROs have begun acting as a backbone of the clinical trial industry through their efficient and cost-effective operations benefitting trial sponsors. According to the blog published on Thermo Fisher Scientific, in 2022, ~3 out of 4 clinical trials were carried out by CROs to reassure the clinical programs of drug developers, drive time and cost efficiencies, provide a wealth of expertise, and deliver customized, high-quality data. The large adoption of the trend of contract research has been witnessed not only by pharmaceutical companies but also by government organizations. The stringent regulations for completing the trials in specific timelines have led government organizations to outsource R&D activities as well. Moreover, increasing investments by the government into the healthcare sector to develop medicines for chronic diseases is also expected to propel the demand for biosimulation. Thus, the development of cost-effective solutions and decreasing errors in CROs during the drug development process are driving the biosimulation market growth.

Regional Analysis:

Based on geography, the biosimulation market segments into five key regions: North America, Europe, Asia Pacific, South & Central America, and Middle East & Africa. In 2022, the North American biosimulation market held the largest share of the global biosimulation market, and the Asia Pacific biosimulation market is estimated to register the highest CAGR during the forecast period. The US biosimulation market held the largest share in the North American biosimulation market. The US has emerged as a leading clinical research destination. Nearly half of the world’s total clinical trials are conducted in the US.

Additionally, most pharma research companies prefer to perform clinical trials in the US owing to established medical infrastructure, fast approval timelines, and a favorable regulatory framework. Moreover, data generated for clinical trials conducted in this country is accepted globally without much scrutiny. A World Health Organization (WHO) report states that the US registered the highest number of clinical trials (157,618) in 2021. Innovative products launched by companies for applications in clinical trials further boost the growth of the clinical trials market in the US. Medical Metrics, a clinical research organization (CRO) providing various services for clinical trials, offers "Assessa," a product that assists in the decision-making process in drug discovery and clinical studies. It can be used in the development of drugs against neurological disorders such as dementia, cognitive impairment, Alzheimer's disease, Schizophrenia, and Parkinson's Disease. The rising number of clinical trials in the US favors the growth of the clinical trials market in the country.

Moreover, various pharmaceutical companies are facing short profit margins due to patent expiry, due to which the spurring manufacturers have initiated to reduce the in-house R&D activities by outsourcing these studies through contract research organizations. This is responsible for preclinical CROs to experience significant growth. The confrontation of biotechnology and pharmaceutical companies to lower drug development costs is expected to propel the biosimulation market in the US. Moreover, the presence of top revenue-generating pharmaceutical companies in the US that can invest a large amount in R&D is also expected to boost the growth of biosimulation in the US. Additionally, the rise in demand for services and medicines in areas of orphan and rare diseases is expected to stimulate drug manufacturers to consult specialist therapeutics and global site relationships through CROs to help them design smarter medicines and recruit patients for clinical trials. The flourishing scenario of outsourcing research in the country is also expected to be responsible for the rise in the number of industry entrants and thus keeping up with the fast pace of the pharmaceutical and medical device industry. Several other factors that are expected to drive the shift of sponsors to CROs include access to therapeutic expertise, reduction of fixed costs, improvement in global reach, access to innovation that was internally absent in the company, and others.

Industry Developments and Future Opportunities:

Various initiatives taken by key players operating in the global biosimulation market are listed below:

1. In March 2023, Certara released the latest version of Simcyp PBPK Simulator Version 22, which can simulate untested scenarios for new patients and therapeutic types.
2. In March 2023, Simulations Plus Inc. established a strategic research collaboration with the Sino-American Cancer Foundation (SACF). Due to this collaboration, the Simulations Plus staff and Artificial Intelligence-driven Drug Design (AIDD) technology in the ADMET Predictor software platform support the discovery and design of novel inhibitors of MTHFD2, an emerging cancer target.

Competitive Landscape and Key Companies:

Some of the biosimulation market leaders are Certara, Simulations Plus, Dassault Simulation, Advanced Chemistry Development, Genedata AG, VeriSIM Life, Schrödinger, Inc., Physiomics, Instem Group of Companies, and Applied BioMath LLC. These companies focus on product launches and expansions geographically to meet the increasing consumer demand worldwide and increase their product range in specialty portfolios. These companies have a widespread global presence, which allows them to serve a large set of customers and subsequently increase their market share. The report offers a trend analysis of the biosimulation market emphasizing various parameters such as market dynamics, technological advancements, and competitive landscape analysis of leading market players across the globe.

Biosimulation Market Report Scope