A New Turning Point in Biotech Innovation: AI-Based Drug Development and Precision Medicine Shaping the 2025 Industry Landscape
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The Paradigm Shift in Drug Development Driven by AI and Biotech Convergence
In 2025, the global biotechnology industry is experiencing an unprecedented wave of innovation through its integration with artificial intelligence technologies. The global biopharmaceutical market is projected to grow by 6.7%, from $642 billion in 2024 to $685 billion in 2025, with the AI-based drug development sector showing a steep annual growth rate of 34.2%. This growth is underpinned by the industry’s efforts to overcome the fundamental limitations of traditional drug development processes and the rapid advancement of AI technologies. Traditionally, bringing a new drug to market took an average of 10-15 years and cost $2.6 billion, but research indicates that utilizing AI-based platforms can significantly reduce this to 5-7 years and approximately $1.5 billion.
Boston-based biotech company Moderna announced a $3.5 billion investment in AI-based mRNA vaccine and therapeutic development in 2025, marking a 42% increase from the previous year. Notably, Moderna’s collaboration with Google DeepMind has resulted in the AI model ‘mRNA-GPT’, which has reduced the mRNA sequence optimization process from 6-8 months to 2-3 weeks. This innovation not only shortens development time but also significantly expands the potential for developing personalized therapies. Similarly, South Korea’s Samsung Biologics is investing 120 billion won in AI-based biopharmaceutical production optimization systems in 2025, aiming to enhance its competitiveness in the global CDMO (Contract Development and Manufacturing Organization) market.
Remarkable advancements are also being made in the field of precision medicine. Illumina’s next-generation genome sequencing platform ‘NovaSeq X Plus’, launched in the first half of 2025, has improved processing speed by 50% and reduced costs by 30%, bringing personal genome analysis down to approximately $99. This marks a significant turning point where precision medicine transitions from being a treatment for the privileged few to a mainstream medical service. In line with this trend, Swiss company Roche is expanding its AI-based diagnostic platform ‘Navify Tumor Board’, which recommends optimal treatments tailored to the genetic profiles of individual cancer patients, currently utilized by 450 medical institutions worldwide.
The Korean biotech industry is actively participating in these global trends. Celltrion is investing 800 billion won in AI-based biosimilar development in 2025, aiming to reduce the development period from 7-8 years to 4-5 years. Notably, Celltrion’s AI platform ‘BioAI-Sim’ is enhancing protein structure prediction accuracy from 78% to 94%, enabling more precise and efficient biosimilar development. This technological advancement is expected to significantly strengthen the competitiveness of Korean companies in the global biosimilar market.
Changes in the Competitive Landscape of the Global Biotech Ecosystem
By 2025, the competitive landscape of the biotech industry is being restructured into a triangular competition among traditional pharmaceutical companies, emerging biotech firms, and big tech companies. Johnson & Johnson is expanding its biotech R&D budget by 18% to $15.6 billion in 2025, with a particular focus on immuno-oncology and cell and gene therapies (CGT). Its Janssen division is emerging as the third player in the CAR-T cell therapy market, following Gilead Sciences and Novartis, aiming to enter clinical phase 3 trials for three new CAR-T therapies by the end of 2025.
Pfizer is also pursuing a strategy to expand its mRNA technology platform beyond COVID-19 vaccines to cancer treatments and rare disease therapies. Pfizer’s personalized cancer vaccine ‘BNT116’, announced in the first half of 2025, demonstrated a 23% improvement in the 5-year survival rate of non-small cell lung cancer patients in phase 2 trials, with commercialization expected in 2026. These achievements suggest that mRNA technology could establish a new paradigm in cancer treatment beyond infectious disease prevention.
Emerging biotech companies are also gaining prominence in the market with their specialized technologies. Oxford-based Exscientia has been recognized with a corporate value of $4.7 billion in 2025 for its AI-based drug development platform, signing a $1.5 billion co-development agreement with GlaxoSmithKline (GSK) for cancer drugs. The company’s AI platform has reduced the preclinical phase from 3-4 years to 8-12 months, making it a sought-after partner for traditional pharmaceutical companies.
The entry of big tech companies into the biotech sector is also accelerating. Google’s DeepMind commercialized AlphaFold3 in 2025, offering protein structure prediction services for an annual subscription fee of $500,000. Currently, 280 pharmaceutical and biotech companies worldwide are utilizing this service, which has improved candidate screening efficiency in the early stages of drug development by over 300%. Microsoft is also providing genome data analysis and AI modeling services through its Azure cloud-based biotech platform, with expected revenue in this field reaching $1.2 billion in 2025.
In the Asian market, competition among companies from South Korea, China, and Japan is intensifying. China’s Baidu and Alibaba are supporting domestic biotech firms through AI-based drug development platforms, with Baidu’s ‘PaddleHelix’ platform supporting the clinical entry of 42 new drug candidates in 2025. Japan’s Takeda Pharmaceutical is specializing in AI-based rare disease drug development, launching clinical trials for three innovative gene therapies in 2025. Amidst this global competition, Korean companies are building differentiated competitiveness based on their strengths in CDMO services and the biosimilar sector.
Interest in the biotech sector is also surging in the investment market. The global biotech venture investment in 2025 increased by 28% to $42.7 billion compared to the previous year, with AI-based drug development and cell and gene therapy accounting for 52% of the total investment. In South Korea, biotech-related venture investments surpassed 3.2 trillion won, with the government’s K-Bio Belt policy fostering rapid growth in the industry ecosystem. Particularly, around 200 biotech startups are actively conducting R&D activities centered around Pangyo Bio Valley and Songdo Bio Cluster, with 15 companies preparing for IPOs within 2025.
Regulatory changes are also having a significant impact on industry development. The U.S. FDA announced new guidelines for AI-based drug development in 2025, paving the way for simplifying existing clinical trial processes based on AI model validation results. The European Medicines Agency (EMA) also announced similar regulatory easing measures, supporting the global spread of AI-based drug development. South Korea’s Ministry of Food and Drug Safety is expanding its regulatory sandbox for AI-based drug development and cell and gene therapies through its ‘Biotech Innovation Hub’ policy in 2025, supporting the enhancement of global competitiveness for Korean biotech companies.
The biotechnology industry is entering a new growth phase in 2025 through the convergence of AI and precision medicine. With the fundamental shift in the traditional drug development paradigm and the anticipated full-scale advent of the era of personalized therapies, companies with technological prowess and innovation capabilities are expected to lead the market. If Korean biotech companies successfully expand into AI-based drug development and precision medicine, building on their competitive edge in global CDMO services and the biosimilar sector, they could play an increasingly important role in the global biotech ecosystem.
*This analysis is based on publicly available market information and industry trends, and additional expert consultation is recommended for investment decisions.*
