BIOSIMULATION MARKET ANALYSIS

Global Biosimulation Market is expected to reach US$ 5,894.4 Mn by 2030, from US$ 1,901.9 Mn in 2023, exhibiting a CAGR of 17.5% during the forecast period. Modeling and simulation (M&S) in the drug development process is a scientific approach used in crucial drug development decisions. In order to avoid issues in discovery and development of new drug, biosimulation offers a promising tool, along with saving both time, money, and improving the predictability in early stage of drug development. Biosimulation refers to simulation of biological systems.

U.S. Food and Drug Administration (FDA) also utilizes M&S in the drug development process. U.S. FDA’s Center for Drug Evaluation and Research (CDER) is currently using modeling and simulation to predict clinical outcomes, inform clinical trial designs, support evidence of effectiveness, optimize dosing, predict product safety, and evaluate potential adverse event mechanisms. Biosimulation is important for drug development, as it provides information regarding dose precision, drug-drug interaction on a molecular level, as well as physiologically-based pharmacokinetic (PBPK) modelling using sophisticated pharmacodynamics models of the heart, liver, and other systems. According to the U.S. FDA’s Office of Clinical Pharmacology (OCP), 2014 data, PBPK modelling: a mathematical predictions of drug interactions with other drugs is increasingly used by FDA in drug discovery and early development process. Moreover, growing adoption of biosimulation tools in various stages of drug development can drive the global biosimulation market growth.

Global Biosimulation Market- Regional Insights

• North America is expected to be the largest market for biosimulation during the forecast period, accounting for over 39.32% of the market share in 2023. The growth of the market in North America is attributed to large participation by both private companies and academic institutions for drug development.
• Europe is expected to be the second-largest market for biosimulation, accounting for over 30.4% of the market share in 2023. The growth of the market is attributed to rising healthcare expenditure and presence of key players in the region.
• Asia Pacific is expected to be the fastest-growing market for biosimulation, with a CAGR of over 18.9% during the forecast period. The growth of the market in Asia Pacific is attributed to t growing technological advancements in the biosimulation.

Figure 1. Global Biosimulation Market Share (%), By Region, 2023

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Analyst Views:

Global biosimulation market is expected to witness growth over the next five years due to increasing R&D investments in pharmaceutical and biotechnology industries. Growing pressure to curb drug development costs and rising demand for personalized medicine can boost demand for biosimulation tools across discovery and development workflow. While North America currently dominates due to presence of major pharmaceutical companies and research institutions, Asia pacific is poised to demonstrate fastest growth due to increasing government funding for biomedical research.

However, high costs associated with biosimulation platform development and integration with other technologies remains a key restraint to widespread adoption in smaller industries and startups. Further, lack of expert skills to handle complex simulations also poses a challenge. To drive future innovation, major players should focus on multi-scale modeling, expanding simulating capabilities beyond small molecules to include biologics and tissues. Collaborations between technology developers and end users could help to address current interoperability issues between various tools.

On the opportunities front, growing uptake of cloud-based simulation solutions provide increased accessibility and may lower the costs of biosimulation platforms. Integrating artificial intelligence could accelerate the drug discovery process by analyzing large volumes of simulation data. Expanding applications beyond traditional R&D into medical devices and personalized medicine presents new avenue for growth.

In summary, while the biosimulation market sees robust growth barriers to entry remain high.

Global Biosimulation Market- Drivers

• Rising R&D expenditure: Rising research and development expenditure in the pharmaceutical and biotechnology industries has been a major factor fueling the growth of the global biosimulation market over the years. As research becomes more complex and expensive, companies are increasingly relying on computational simulation and modelling techniques to optimize their R&D processes and reduce costs. Biosimulation allows researchers to test theoretical hypotheses in silico before committing resources to physical experimentation. This helps in lowering failure rates in drug development and accelerate clinical trials. According to the data published by Organization for Economic Co-Operation and Development (OECD), 2020 global pharmaceutical R&D spending grew from about US$ 160 billion in 2015 to nearly US$ 190 billion in 2020. The top 10 pharmaceutical companies alone spent over US$ 100 billion on R&D in 2020. High costs associated with drug development and stringent regulatory norms have compelled big pharma players to adopt digital technologies like biosimulation earlier in the discovery and preclinical testing phases. This trend is expected to continue as next-generation precision medicines and complex biologics require even higher investments. Overdependence on animal testing is also being reduced due to ethical concerns, providing further impetus to 'in silico' simulation models.
• Increasing pharma and biotech funding: Global biosimulation market is witnessing significant growth, owing to rising investments in pharmaceutical and biotech research and development activities. Biosimulation techniques are extensively used in drug discovery and development to gain insights into biological processes and predict the behavior of biological systems. It helps researchers to study the effects of potential drug candidates in silico (using computer simulations) before moving them to expensive and time-consuming wet lab testing and clinical This significantly reduces costs and time involved in new drug development. With billions being invested by governments and companies worldwide into developing novel drugs and therapies, the demand for biosimulation tools and services is steadily increasing. For instance, in 2022, according to the data published by White House Office of Science and Technology Policy, the U.S. government had invested over US$ 6.5 billion in 2021 for Covid-19 therapeutics development through various programs like Operation Warp Speed. Similarly, the U.K. government announced investments of over US$ 1 billion in 2021 for establishing research hubs focusing on advanced therapies, cell and gene therapies, and diseases with unmet needs like cancer. A report by the European Commission mentioned that the EU's funding for healthcare research reached US$ 3.6 billion in 2020, a significant increase from the previous years.
• Technological advancements: Technological advancements in the field of biosimulation is one of the major factors augmenting the growth of the global biosimulation market. Biosimulation tools enable to digitally model biological systems right from the molecular to the organ level and run various biological experiments in silico rather than animal and human testing. This significantly reduces the cost and time involved in drug discovery while ensuring safety and efficacy. Advancements in fields like machine learning, artificial intelligence and high performance computing have enabled the development of highly sophisticated computational models that can closely mimic biological functions. For instance, machine learning techniques are being used to improve simulation models by incorporating data from real-world clinical trials and experiments. This helps to make biosimulation models more accurate, specific and personalized over time. Cloud computing infrastructure is also supporting the computational power and data needs of highly complex biosimulation models. This makes advanced modeling accessible for small to medium organizations. Market players are launching upgraded softwares for biosimulation, and this is expected to drive the global biosimulation market growth over the forecast period. For instance, in 2023, Certara, a manufacturer of  biosimulation software, launched version 8.4 of its Phoenix platform, the industry gold standard in pharmacokinetic/ pharmacodynamic (PK/PD) and toxicokinetic modeling and simulation software. Version 8.4 delivers new features driven by customer demand that improve efficiency, quality, and speed. The new software consist of usability enhancements, auditability improvements and compatibility upgrades.
• Growing focus on precision medicine: The rise of precision medicine and its focus on tailoring treatment specific to an individual's genetic makeup is a major factor driving the growth of global biosimulation market. Precision medicine helps doctors and researchers to predict more accurately how a particular disease or treatment and may affect a particular person by analyzing biological markers. This requires complex simulations at molecular and cellular level to understand the disease pathways and effects of various treatment options on human Biosimulation tools and technologies are enabling researchers to create highly customized computer models of organs, tissues and entire organisms which can help test thousands of therapies, doses and drug combinations virtually before subjecting them to expensive and time-consuming clinical trials. For example, biosimulation of tumor growth and drug response mechanism at molecular level is helping oncologists to select the most effective drug and dosage for cancer patients based on their individual genetic profile. Some biosimulation tools are also being used to design novel drugs and biologics in a safer and cost-effective manner. According to World Health Organization (WHO), by2023, around 75% of novel therapies under development will use biosimulation tools during research and development.
• Reduction in drug development costs: The reduction in drug development costs through use of biosimulation is a major factor driving growth of global biosimulation market. Biosimulation offers pharmaceutical companies opportunities to reduce financial risks in drug development by enabling testing of new drug candidates via computer simulation, before moving to expensive and time-consuming animal and clinical trials. This in silico, or on computer, modeling and simulation allows researchers to test thousands of what-if scenarios to optimize drug molecules for desired responses in the human body, without using live subjects. The cost and time savings from applying biosimulation are substantial. According to U.S. Food and Drug Administration (FDA), on an average, only one in 10,000 drug candidates entering preclinical testing makes it to human testing, showing a huge attrition during development. Similarly, the Tuft Center for the Study of Drug Development pegs the cost of bringing a new drug to market at an average of US$ 2.6 billion. Even a small percentage of cost-cutting and time reduction through biosimulation translates to significant savings.

Global Biosimulation Market- Opportunities

• Emerging markets: Emerging markets have strong potential to drive future growth in the biosimulation market. Regions experiencing rapidly growing populations and economies are demanding more sophisticated healthcare technologies. Particularly in South and Southeast Asia, countries such as India, China, Indonesia and others are increasing investments in biotech and biomedical research substantially. Governments and funding bodies in emerging nations recognize the importance of being able to model biological systems and processes for new drug design and development as well as simulated testing before expensive live trials. This reduces costs and speeds the process of approving effective new treatments that can improve healthcare outcomes. Local biosimulation startups are also emerging to serve these regional needs and partner with global firms. According to data published by United Nations Department of Economic and Social Affairs, in 2022, many emerging economies witness demographic shifts where aging populations will increasingly strain conventional healthcare infrastructures. For example, over 60% of Indonesia’s population will be of working age by 2030 as longevity increases. This strong and growing workforce demands access to modern biomedical innovations.
• Adoption of AI and cloud computing: Adoption of AI and cloud computing can provide huge opportunities in the global biosimulation market. Biosimulation uses computational methods to mimic biological processes and helps in advancing medical research. With AI and cloud, the power of biosimulation can be harnessed at an unprecedented scale. AI combined with biosimulation can process large and complex biological and medical data more efficiently. It allows researchers to generate novel insights and hypotheses by identifying patterns in huge datasets that may remain undetected otherwise. For example, AI techniques like machine learning and deep learning have helped researchers at the U.S. National Cancer Institute to study protein interactions and genetic sequences related to cancer at an individualized level using genomic and molecular data from over 500,000 cancer patients collected between 2010-2020. This is helping in discovering new tumor subtypes and potential drug targets.
• Collaborations between pharma companies and biosimulation players: Collaborations between pharmaceutical companies and biosimulation players could provide a major opportunity in the biosimulation market. Biosimulation utilizes specialized software and modelling techniques to simulate biological processes at the molecular, cellular, multi-cellular or whole organism level. This helps researchers to better understand disease mechanisms and evaluate how new drug candidates might interact with living systems. Pharma companies hold a wealth of data related to disease areas and drug development programs that could help biosimulation players further refine their platforms. Biosimulation tools offer pharma companies new ways to accelerate drug discovery and development. Through collaborative partnerships, both sides stand to gain valuable insights. Pharma companies can leverage biosimulation platforms to gain a more predictive understanding of lead compounds and biology earlier in the pipeline. This facilitates selecting the most promising candidates and designing optimal clinical trial protocols.

Global Biosimulation Market- Trends

• Adoption of cloud computing: Many leading biosimulation vendors are now offering cloud-based software-as-a-service (SaaS) delivery models to access their platforms. For example, in 2021, more than 50% of Dassault Systèmes’ simulation and 3D design platform sales now come from its 3DEXPERIENCE platform delivered via the cloud. This is luring more small research organizations and startups to adopt biosimulation tools who earlier found on-premise licenses quite expensive. Cloud is helping to remove barriers for entry for such firms to access advanced simulation technologies. The pay-as-you-go commercial models of cloud are also appealing to research groups engaged in project-based work who need resources for short periods of time.
• Advancement of AI and machine learning: The rapid developments witnessed in the fields of artificial intelligence and machine learning over the past decade have widespread impacts across many industries. In the biosimulation sector, AI and machine learning technologies are revolutionizing how biological systems can be modeled and analyzed computationally. These new computational approaches are enabling researchers to build significantly more complex and detailed models that better mimic real-world biological processes. For example, machine learning tools are allowing scientists to generate predictive models of disease progression and treatment response using huge datasets that would be impossible to analyze through traditional manual methods.
• Focus on target identification and validation: Several pharmaceutical firms are increasingly leveraging biosimulation to screen thousands of potential drug compounds in silico, before moving to the costly stages of wet-lab testing and clinical trials. This helps to optimize research investments on candidates that are more likely to succeed. For example, according to a 2022 study published by Journal Cell Systems, BenevolentAI, a biotech company, utilized computational structural biology techniques to discover a novel target protein and develop an oral drug for eye disease in just 18 months. This demonstrated how modern biosimulation tools can accelerate the traditional drug development cycle from discovery to market.

Global Biosimulation Market- Restraints

• High setup costs: High setup costs required for biosimulation is one of the major factors restraining the growth of this industry. Biosimulation involves the use of sophisticated software and systems that can accurately simulate biological processes at molecular, cellular, tissue and whole organism levels. Developing such complex modeling and simulation solutions require huge investments in R&D. It takes several years of research and testing to build robust platforms that can handle large and complex datasets generated during preclinical drug discovery and development processes. This involves employing top data scientists, biology experts, engineers and others which adds to the labor costs as well.
• Shortage of skilled workforce: There is a severe shortage of individuals possessing the right skill set to take advantage of biosimulation technologies. According to a study by National Science Board in 2022, only 30% of U.S. undergraduate students graduating with a degree in science, technology, engineering and mathematics (STEM) fields were adequately prepared with computational skills needed for research and jobs of the future. Most of the STEM graduates lack interdisciplinary training involving coding, data analysis, machine learning, and others that is essential for applying biosimulation techniques effectively. This skills gap has discouraged pharmaceutical and biotech companies from investing more in biosimulation capabilities.
• Regulatory issues: Regulatory issues are one of the major factors restraining the growth of the biosimulation market. Biosimulation aims to emulate complex biological processes using advanced modelling and simulation techniques. However, developing accurate biosimulation models and validating their predictive capabilities is a complex process that needs to meet rigorous regulatory standards. Regulators require extensive validation and documentation of any biosimulation platform before it can be used for research applications such as drug discovery. Developing models that can effectively emulate human biological complexities at a molecular, cellular, physiological and whole body level is an ongoing research challenge. Regulators need to ensure any biosimulation tools or platforms used for research have been thoroughly tested and proven to provide reliable and reproducible results before the outcomes can be trusted. This puts pressure on biosimulation developers to invest significantly in research and clinical validation efforts over long periods to satisfy regulatory norms.

Global Biosimulation Market- Recent Developments

New Product Launches

• For instance, in 2022, Certara, a global manufacturer of biosimulation software, announced the release of new versions of its Immunogenicity (IG), Immuno-oncology (IO) and Vaccine Simulators to predict how drugs work and address key questions in the development of novel biologic therapies
• For instance, in 2020, 54gene, a Nigeria-based health tech precision medicine research company, launched its Clinical Research Programme Services (CPS) division. The new business division will provide end-to-end clinical development services, intelligence, logistics, and infrastructure to enable the conduct of clinical trials in Africa, starting out of Nigeria
• In 2022, Dante Labs, a global provider of genomic information and precision medicine, announced new genomic driven biosimulation and significant progress made to its drug discovery program, demonstrating the value of the Dante Platform

Acquisition and Partnerships

• In 2022, Cadence Design Systems, Inc., an multinational computational software company, entered into a definitive agreement to acquire privately held OpenEye Scientific Software, Inc., a provider of computational molecular modeling and simulation software being widely and increasingly used by pharmaceutical and biotechnology companies for drug discovery
• In 2021, CATO SMS, a global provider of regulatory and clinical research services, announced that it had acquired Nuventra, Inc. to extend its offering into the critical area of clinical pharmacology. Nuventra is one of the industry’s leading clinical pharmacology science and services providers.  The acquisition expanded CATO SMS’ portfolio of specialized solutions that support biopharmaceutical companies with drug development, adding a key set of capabilities focused on significantly reducing development risk, costs and timelines.

Figure 2. Global Biosimulation Market Share (%), By Product and Services, 2023

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Top companies in Global Biosimulation Market

• Certara, L.P.
• Simulations Plus, Inc.
• Dassault Systèmes (Accelrys)
• Genedata AG
• LeadScope, Inc.
• Compugen Inc.
• Schrödinger, LLC
• In Silico Biosciences, Inc.
• Advanced Chemistry Development, Inc.
• Chemical Computing Group ULC
• Physiomics PLC
• Pharmaceutical Product Development, LLC (Evidera).

Definition: Biosimulation is a computer-aided mathematical simulation of biological processes and systems and thus, is an integral part of systems biology.