CHEMINFORMATICS MARKET SIZE AND SHARE ANALYSIS - GROWTH TRENDS AND FORECASTS (2023 - 2030)

The global cheminformatics market size is expected to reach US$ 10.22 billion by 2030, from US$ 3.79 billion in 2023, at a CAGR of 15.2% during the forecast period. The increasing demand for new drugs and the rising need for efficient drug discovery and development are the major factors driving the growth of the cheminformatics market.

Cheminformatics is a multidisciplinary field that combines chemistry, computer science, and information science to store, manage, and analyze chemical data. It is used in various applications, such as drug discovery, chemical safety, and environmental analysis.

Cheminformatics Market Regional Insights

• North America is the largest market for cheminformatics, accounting for a 35% share in 2023. The growth of this market is attributed to the increasing investment in research and development by pharmaceutical and biotechnology companies in the region. Additionally, the presence of a large number of academic institutions and research institutes is also driving the growth of the cheminformatics market in North America. For instance, in March 2021, Elsevier, a renowned leader in the domain of research publishing and information analytics, unveiled a new partnership with LexisNexis Legal & Professional, a part of the RELX Corporation that sells data analytics products and various databases. This collaboration aims to enhance the existing patent information in Reaxys, Elsevier’s solution for chemistry Research & Development. As a result of this integration, companies and researchers can now access the intellectual property patent content from LexisNexis, which is the driving force behind LexisNexis PatentSight (Patent Analytics) and LexisNexis TotalPatent One (Patent Search), within their current workflow.
• Europe is the second-largest market for cheminformatics, accounting for a 25% share in 2023. The growth of this market is attributed to the increasing adoption of cheminformatics tools and technologies by pharmaceutical and chemical companies in the region. Additionally, the presence of a strong regulatory environment is also supporting the growth of the cheminformatics market in Europe.
• Asia Pacific is the fastest-growing market for cheminformatics, accounting for a 20% share in 2023. The growth of this market is attributed to the increasing demand for new drugs and chemicals from the emerging economies in the region. Additionally, the growing focus on personalized medicine is also driving the growth of the cheminformatics market in Asia-Pacific.

Figure 1. Global Cheminformatics Market Share (%), by Region, 2023

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Analyst Viewpoint:

The cheminformatics market is poised to grow significantly over the coming years. The market is predominantly driven by increasing R&D expenditure in the pharmaceutical and biotechnology sectors. Rising drug discovery and development activities have bolstered the demand for cheminformatics software and services. Additionally, growth in applications of cheminformatics in material science, agriculture, and chemical industries is another prominent driver for market expansion.

Cheminformatics Market Drivers

• Increasing R&D investments in pharmaceutical and biotechnology industries: The pharmaceutical and biotechnology industries are steadily increasing their R&D investments to discover novel drugs and biologics. The average cost of developing a new drug is estimated to be over US$2.50 billion. Companies are adopting the latest technologies, like cheminformatics, to make the long and expensive drug discovery process more efficient. For instance, in 2021, the global pharmaceutical R&D spending was estimated to be US$179 billion, increasing by about 3% over 2020. The expanding R&D budgets create significant opportunities for growth of the cheminformatics market. Moreover, according to the 2022 EU Industrial R&D Investment Scoreboard, health industries invested about US$ 266.40 billion (€235.3 billion) in R&D in 2021, accounting for 21.5% of total business R&D expenditure worldwide.
• High throughput screening and combinatorial chemistry: High throughput screening allows rapidly testing thousands of chemical compounds against therapeutic targets. Combinatorial chemistry produces large compound libraries for high throughput screening. This generates huge volumes of chemical data. Cheminformatics plays a vital role in analyzing this data and identifying hit compounds. For example, machine learning models can predict properties of virtual compounds to focus screening on compounds with desired characteristics. The growing adoption of HTS and combinatorial chemistry drives cheminformatics software adoption.
• Growth in biosimilars and biologics: Biologics, including monoclonal antibodies and recombinant proteins, are complex, large molecules. Their discovery and development require specialized modeling and simulation tools provided by cheminformatics software. The increasing number of approved biologics and the upcoming patent expiration of blockbuster biologics are expected to drive the growth of biosimilars. Cheminformatics enhances the characterization, production, and quality control of biosimilars. According to estimates, the global biosimilars market is projected to grow at a CAGR of over 30% from 2022 to 2030.
• Increasing adoption of cloud-based solutions: Cloud-based cheminformatics software enables researchers to access advanced modeling and simulation capabilities on-demand through cloud infrastructure. It allows companies to reduce upfront costs associated with on-premise solutions. Small companies also gain access to enterprise-level cheminformatics capabilities. Cloud solutions also offer advantages like better collaboration, scalability, and regular feature upgrades. The growing trend of adopting cloud-based solutions is expected to provide growth opportunities.

Cheminformatics Market Opportunities

• Integration with emerging technologies: There are significant opportunities for the integration of cheminformatics software with emerging technologies like artificial intelligence, machine learning, and automation. AI can analyze large chemical datasets through high-throughput screening to predict the properties of new molecular structures. Automation can help accelerate workflows in repetitive tasks like data entry, analysis and reporting. For example, advanced algorithms can systematically traverse chemical space to generate focused virtual compound libraries. Integrating these technologies can enhance productivity. For instance, on March 28, 2023, Simulations Plus, Inc., a leading provider of modeling and simulation software and services for pharmaceutical safety and efficacy, announced that it established a strategic research collaboration with the Sino-American Cancer Foundation (SACF). This collaboration will leverage Simulations Plus’ staff and Artificial Intelligence-driven Drug Design (AIDD) technology in the ADMET Predictor software platform to support the discovery and design of novel inhibitors of methylenetetrahydrofolate dehydrogenase 2 (MTHFD2), an emerging cancer target.
• Expansion in emerging markets: Emerging pharmaceutical markets in Asia Pacific, Latin America, and Middle East & Africa offer lucrative growth opportunities for cheminformatics software providers. The increasing investments in biopharmaceutical research and favorable government policies are attracting companies to these markets. Local companies are also increasingly adopting newer technologies. Setting up partnerships and providing localized solutions tailored to market needs can help strengthen presence in emerging markets.
• Growing focus on rare and orphan diseases: The emerging focus on developing treatments for rare and orphan diseases presents an opportunity for cheminformatics software. These diseases have complex underlying mechanisms and often lack clarity on therapeutic targets. Cheminformatics can assist in understanding disease pathways and identifying suitable drug molecules through modeling molecular interactions. Companies can leverage these benefits and develop specialized modeling solutions for rare disease drug discovery.
• Entry of new players: The cheminformatics software market has high entry barriers due to the initial investments required in R&D and advanced algorithm development. However, the increasing adoption of cloud-based solutions offers opportunities for specialized technology companies to enter this space through strategic partnerships. Emerging companies focused on AI and ML can partner with pharmaceutical companies to transform legacy workflows by integrating new capabilities. This can expand the range of solutions on offer.

Cheminformatics Market Trends

• Integration with artificial intelligence and machine learning: Artificial intelligence and machine learning are disrupting drug discovery workflows. AI algorithms can predict the properties of compounds, identify promising leads, and design focused libraries for screening. ML improves virtual screening accuracy by training on experimental bioactivity data. For instance, deep learning neural networks can learn complex molecular interactions. Integrating AI and ML with cheminformatics enhances the productivity and reduces time taken in initial screening phases. For instance, in February 2022, Elix, Inc., an AI drug discovery company, developed kMoL, a machine learning library for AI drug discovery with federated learning functionally.
• Adoption of cloud-based solutions: Pharmaceutical companies are increasingly adopting cloud-based cheminformatics platforms over on-premise solutions. The scalability, flexibility, and affordable pricing offered by cloud platforms provide advantages over traditional software. Cloud solutions enable accessing centralized databases, advanced simulation capabilities, and computational resources through the internet. Companies can avoid the large upfront costs associated with on-premise installations. Smaller companies also gain access to enterprise-level solutions using the cloud.
• Use of real world evidence: Real-world data from clinical practice, such as electronic medical records, patient registries, and insurance claims, provides valuable insights. Cheminformatics software can integrate real world evidence with clinical trial data to support drug discovery decisions. It enables a better understanding of disease profile in diverse patient populations. The demand for real world evidence integration will rise as payers increasingly focus on effectiveness in patient populations outside clinical trials.
• Emergence of contract research organizations: Biopharmaceutical companies are increasing outsourcing drug discovery activities to cut costs and improve efficiency. Contract research organizations (CROs) provide services spanning hit identification, lead optimization and preclinical development using informatics platforms. CROs invest in the latest cheminformatics and bioinformatics solutions to offer niche services to clients. Small companies also benefit from accessing advanced technologies through outsourcing partnerships with CROs.

Cheminformatics Market Restraints

• High upfront costs: Cheminformatics software solutions require large investments in licensing, hardware, maintenance, training and integration. Companies must strategically evaluate expected ROI from automation of specific drug discovery processes before software purchase. Many smaller companies cannot afford large upfront expenses, limiting adoption. However, the availability of scalable cloud-based pricing models is expected to address cost concerns and drive broader adoption.
• Shortage of trained personnel: The efficient use of cheminformatics platforms requires researchers trained in deploying, operating, and maintaining complex software tools. However, there is a shortage of personnel with specialized skills like software coding, computation chemistry knowledge, and data analytics experience. Educational institutes must develop targeted cross-disciplinary training programs and industry collaborations to address this gap in skilled labor.
• Integration challenges: Seamless integration of cheminformatics tools with existing research workflows poses challenges for technology adoption. For instance, legacy enterprise systems may lack the capabilities to interface with newer software. Migrating historical data to new structured formats can be difficult. Companies must properly evaluate integration requirements during technology evaluation to maximize benefits and ROI from investments.

Recent Developments

• On October 25, 2023, Cadence Molecular Sciences (OpenEye), a business unit of Cadence Design Systems, announced that Pfizer Inc., an American multinational pharmaceutical and biotechnology corporation has signed an agreement to extend and expand access to Cadence products and programming toolkits for advanced molecular design.
• In January 2022, Discngine, a research and lab informatics software and services company, announced a strategic partnership with ChemAxon, a leading cheminformatics and bioinformatics company. By joining forces, partners expect to streamline pharma and biotech research involving complex biomolecular structural data.
• In October 2020, Dotmatics Ltd, a scientific informatics software and services company, announced it had expanded its product portfolio to include Blueprint, a self-service, scientific visualization and analytics application for small molecule discovery.
• In September 2020, Simulations Plus, Inc., the leading provider of modeling and simulation solutions for the pharmaceutical, biotechnology, chemicals, and consumer goods industries, announced that it had entered into an accelerated second phase of its collaboration with a large pharmaceutical company to tailor its high-throughput pharmacokinetic (HTPK) simulation functionality within ADMET Predictor to support the sponsor partner’s lead selection activities for small molecule programs.

Acquisition and Partnerships

• In September 2022, Cadence Design Systems, Inc. completed the acquisition of OpenEye Scientific Software, Inc. Adding OpenEye’s technologies and experienced team accelerates the Cadence Intelligent System Design strategy. It is done by extending Cadence’s computational software core competency to molecular modeling and simulation targeted at life sciences.
• In June 2022, TetraScience, the R&D Data Cloud, stated that ChemAxon, one of the leading web-based cheminformatics and bioinformatics software providers, joined the Tetra Partner Network. It is to help customers dramatically increase their capacity to find and synthesize chemical compounds with improved property profiles.

Figure 2. Global Cheminformatics Market Share (%), by Application, 2023

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Top companies in Cheminformatics Market

• Scilligence
• BioSolveIT GmbH
• Collaborative Drug Discovery Inc.
• Chemaxon Ltd
• Certara
• BIOVIA
• Chemical Computing Group
• Agilent Technologies
• Schrödinger
• PerkinElmer
• CambridgeSoft
• Molecular Discovery
• OpenEye Scientific Software
• Dassault Systèmes 

Definition: Cheminformatics involves the use of computational techniques to analyze chemical information. It combines computer science, information technology, and chemistry to interpret chemical data. Cheminformatics has applications in pharmaceutical and biotechnology research for drug discovery by predicting the biological activities of compounds through modeling and simulation. Key techniques used include quantitative structure–activity relationship (QSAR) modeling, molecular modeling and simulation, virtual screening, and chemical database management. Cheminformatics enables faster and more efficient drug discovery by complementing traditional wet lab experiments.

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