A New Wave of Biotech Innovation: Market Changes Driven by the Convergence of Precision Medicine and AI by 2026
Editor
The Fusion of AI and Biotech Emerges as a New Growth Driver
As of early 2026, the global biotechnology industry is undergoing fundamental changes through its integration with artificial intelligence. According to the latest report from McKinsey & Company, the global biotech market is projected to grow by 7.7%, from $689 billion in 2025 to $742 billion in 2026. AI-based biotech solutions are expected to account for $118 billion, a 23% increase from the previous year. Particularly, the field of precision medicine is recording an impressive annual growth rate of 12.4%, establishing itself as a key driver of biotech innovation.
This growth is fueled by the synergy between the accumulated biotech capabilities post-COVID-19 pandemic and advancements in AI algorithms. Global pharmaceutical giants, such as Genentech in South San Francisco, California, Roche in Basel, Switzerland, and Johnson & Johnson in New Brunswick, New Jersey, are significantly expanding their investments in AI-based drug development platforms. Roche, for instance, invested $3.4 billion in AI drug development in 2025 and plans to increase this to $4.2 billion in 2026. Johnson & Johnson is also investing $2.8 billion through its Janssen Pharmaceutical division in AI-based immuno-oncology drug development.
The Korean biotech industry is also experiencing rapid growth in line with these global trends. Samsung Biologics, headquartered in Songdo, Incheon, reported a 4th quarter revenue of 924 billion KRW in 2025, marking an 18.3% growth compared to the same period the previous year. Notably, it ranked fourth globally in the biosimilar production sector and announced plans to sign a next-generation antibody-drug conjugate (ADC) production contract with Switzerland’s Novartis in the first half of 2026. This long-term contract, valued at $4.7 billion, is the largest single contract ever signed by a Korean biotech company.
Celltrion, also based in Incheon, is accelerating the expansion of its biosimilar portfolio. Having achieved consolidated sales of 2.846 trillion KRW in 2025, Celltrion announced that it expects to receive approval from the European Medicines Agency (EMA) for its next-generation rheumatoid arthritis treatment in the first half of 2026. Clinical phase 3 results showed that this treatment reduces side effects by 30% while improving therapeutic efficacy by 15% compared to existing treatments.
Accelerating Commercialization of Precision Medicine and Personalized Treatment
One of the most notable trends in the 2026 biotech industry is the full-scale commercialization of precision medicine. According to the latest analysis from Deloitte, the personalized treatment market utilizing individual genetic information is projected to grow by 22.6%, from $124 billion in 2025 to $152 billion in 2026. This growth rate is three times that of the overall biotech market, with industry experts evaluating precision medicine as the new growth engine for biotech.
Moderna, headquartered in Cambridge, Massachusetts, is achieving groundbreaking results in the development of personalized cancer vaccines using mRNA technology. Clinical phase 2 results announced in December 2025 indicated that personalized mRNA cancer vaccines, developed based on individual tumor genetic analysis, reduced recurrence rates by 44% compared to standard treatments. Moderna plans to submit an FDA approval application in the second half of 2026, which, if successful, is expected to create a market worth $8 billion annually.
Innovative advancements are also continuing in the field of gene therapy. Spark Therapeutics, based in Philadelphia, Pennsylvania, is solidifying its leadership in developing gene therapies for rare genetic disorders. Its Luxturna treatment for Leber congenital amaurosis (LCA), approved in 2025, recorded $1.2 billion in sales in its first year, with three additional rare disease treatments expected to complete clinical phase 3 in 2026. Each treatment is anticipated to be priced between $850,000 and $1.2 million, offering economic value to both patients and insurers due to their potential for lifelong efficacy as a one-time treatment.
In Korea, innovation in the precision medicine field is also accelerating. SK Biopharm, headquartered in Seongnam, Gyeonggi Province, is introducing personalized treatment methods considering individual genetic variations in the development of epilepsy treatments. SK Biopharm, which recorded 184 billion KRW in revenue in the fourth quarter of 2025, announced plans to start clinical phase 2 for a personalized epilepsy treatment considering CYP2C19 genetic variations in the first half of 2026. This treatment is expected to reduce side effects by 40% while enhancing seizure suppression by 25% compared to existing treatments.
Additionally, government support for building a domestic precision medicine ecosystem is expanding. The Ministry of Science and ICT announced a 30% increase in the budget for the ‘Precision Medicine Commercialization Support Project’ in 2026, allocating 240 billion KRW. This project aims to establish a genome database tailored to Koreans and advance AI-based drug development platforms. Collaboration between major medical institutions such as Samsung Medical Center, Asan Medical Center, and Severance Hospital, along with biotech companies, is expected to accelerate the development of precision medicine solutions tailored to Koreans.
Biotech industry experts predict that 2026 will be the inaugural year for the popularization of precision medicine. Sarah Chen, a biotech expert partner at Boston Consulting Group, analyzed that “from the second half of 2026, the cost of personal genetic testing will fall below $500, making precision medicine an accessible treatment option for general medical professionals and patients.” In fact, major U.S. insurers have decided to include genetic testing and personalized treatment for specific cancers in their coverage starting in 2026, which is expected to be a significant turning point for the expansion of the precision medicine market.
In the field of immuno-oncology, personalized approaches are also gaining attention. Novartis, headquartered in Basel, Switzerland, plans to launch a next-generation CAR-T therapy for solid tumors in 2026, following the success of CAR-T cell therapies Kymriah and Yescarta. This therapy applies technology that analyzes the tumor microenvironment of individual patients to produce optimized CAR-T cells, expected to improve treatment success rates by 35% compared to existing CAR-T therapies. Novartis projects that the global market for this therapy will reach $15 billion annually by 2030.
The convergence of digital healthcare and biotech is also accelerating. Services that predict and prevent diseases by combining real-time biometric data collected through wearable devices with genetic information are entering the commercialization phase. Apple, based in Cupertino, California, has developed AI algorithms that analyze data such as ECG, blood oxygen levels, and sleep patterns collected through Apple Watch to detect atrial fibrillation and sleep apnea early. As of the fourth quarter of 2025, 120 million Apple Watch users worldwide are utilizing this feature, with Apple reporting that diseases detected early through this feature amount to 150,000 cases per month on average.
These digital healthcare data are also being utilized in the development of new drugs by pharmaceutical companies. Pfizer, headquartered in New York, has developed an AI model that detects early signs of Alzheimer’s dementia using wearable device data. This model comprehensively analyzes gait patterns, sleep quality, and voice changes to predict cognitive decline 3-5 years in advance on average. Pfizer plans to start large-scale clinical trials for an Alzheimer’s prevention treatment in the second half of 2026 based on this technology.
Korean biotech companies are also pursuing innovation through the convergence with digital healthcare. Medihear, headquartered in Seoul, has developed an early cancer detection service that combines AI-based medical imaging analysis technology with genetic testing. This solution, which began pilot services at major general hospitals in Korea in December 2025, improved early detection rates of lung cancer by 28% compared to existing screenings. Medihear plans to expand this service to the Southeast Asian market in the first half of 2026, promoting partnerships with local medical institutions in Singapore and Thailand.
These innovative changes in the biotechnology industry are also attracting significant interest from the investment market. In 2025, global biotech venture investment reached $28 billion, a 15% increase from the previous year, with precision medicine and AI biotech accounting for 42% of the total. Goldman Sachs biotech analysts project that biotech venture investment will expand to $32 billion in 2026, with investment growth in the Asia-Pacific region expected to exceed 25%.
Changes in the regulatory environment are also supporting biotech innovation. The U.S. FDA announced new guidelines for AI-based drug development in December 2025, officially approving the design of clinical trials and data analysis using AI algorithms. The European Medicines Agency (EMA) also began incorporating clinical trial data using digital biomarkers into official review processes starting January 2026. The Korean Ministry of Food and Drug Safety plans to announce ‘AI-based Medical Device and Therapeutic Approval Guidelines’ in the first half of 2026, which is expected to further accelerate the development and commercialization of innovative products by domestic biotech companies.
Considering these comprehensive changes, the biotechnology industry in 2026 is at a turning point where technological innovation and market expansion are occurring simultaneously. Particularly, the proportion of Korean biotech companies in the global market is continuously expanding, and with active government support, the potential for growth into a globally competitive biotech hub is increasing. Investors and industry stakeholders are closely monitoring these changes, focusing on identifying companies that can benefit from the next wave of biotech innovation.
This content is for informational purposes only and is not intended as investment advice or a recommendation of specific stocks. Investment decisions should be made based on individual judgment and responsibility, and thorough review and consultation with experts are recommended before investing.
