The pharmaceutical industry has historically grappled with long development timelines and lower success rates; however, technology such as AI has helped to mitigate these in recent years. In pursuit of even shorter timelines and reduction in wasteful spending on low-potential candidates, incumbents continue to expand their innovation activities.

Also, the effectiveness of existing medical treatments and drugs is waning, primarily due to increased antibiotic resistance, so pharmaceutical companies are increasingly looking toward technology and innovation to improve the returns on their R&D spend. This could be either through improving the effectiveness of medical treatments through Precision Medicine, Preventive Healthcare, and Regenerative Medicine or by accelerating the development and commercialization process through AI Drug Discovery and Clinical Trial Technology.

In this Edge Insight, we focus on seven global pharmaceutical companies that are considered part of Big Pharma: Johnson & Johnson (J&J), Roche, Pfizer, Merck Group, AstraZeneca (AZ), GlaxoSmithKline (GSK), and Bayer. These companies are major players in the pharmaceutical and life sciences sectors. They also have exposure in areas such as crop biotechnology and agri-tech.

Our analysis is derived from SPEEDA Edge’s competitor intelligence portfolio, which provides both a quick overview of all the incumbent activities in emerging industries and a detailed list of all activities. We have considered the incumbents’ involvement in emerging industries over the last five years (January 2017–present) for this analysis. By diving into their investments, partnerships, and M&A activities, we examine the most significant emerging technologies in the healthcare and pharmaceutical sectors, recent trends, preferred modes of engagement with startups in these emerging industries, and more.

Innovation activity in the pharmaceutical industry has historically focused on the acquisition of promising drug candidates. Incumbents prefer to invest in smaller drug development companies and wait for the candidates to progress in terms of viability and safety before investing further or acquiring the company. These acquisitions are effectively an inorganic form of R&D.

As the emphasis on R&D ROI has risen in recent years, pharmaceutical companies have expanded their partnership and investment focus toward disruptors that can help improve returns. This is most evident in the innovation activities in the AI Drug Discovery space, with drug discovery as a whole accounting for close to 30% of total R&D spending by pharmaceutical companies. Improvements in drug discovery are being enabled by advances in computing technologies like quantum computing, speeding up discovery through molecular simulations and helping discover potential candidates for untreatable diseases through the application of AI across multimodal datasets.