3 Reasons The Health AI Market is a Great Investment
Artificial intelligence (AI) is already changing our lives in countless ways. While some people fear an inevitable future where AI replaces human jobs, others embrace the efficiency AI will bring to industries in desperate need of improvement.
Investors see AI as the next big thing, and are pouring money into the market. As the technology improves, we'll all see benefits. Some jobs will be replaced, and more will open as new tech-enabled industries are born.
Change is inevitable, and fearing change is human. One the bright side, artificial intelligence can do a lot of boring, repetitive jobs humans hate. Smart machines can clean poisonous tanks, do back-breaking labor, and analyze data to make the work we do more accurate.
One of the industries most recently impacted by AI is pharmaceuticals.
Here are three reasons medical AI is poised to be the investment of the century.
1. Drug Development
Developing new drugs is a long, onerous, and expensive process. While people suffer with chronic illnesses, drug companies often spend decades trying to bring new drugs and therapies to the market.
In an interview with Reuters, Andrew Hopkins, chief executive of artificial intelligence company Exscientia, said "Exscientia’s AI system could deliver drug candidates in roughly one-quarter of the time and at one-quarter of the cost of traditional approaches."
For patients with chronic diseases, cutting drug development time and costs by 75% holds tremendous promise. Expanded use of AI can potentially curtail the skyrocketing costs of drug development, and, in turn, reduce the out-of-pocket costs to patients in need.
Pharmaceutical sales is a $333 billion market, and AI will make the process faster and cheaper while serving a larger pool of patients.
2. Precision Medicine using Genetic Signature Targeting
One of the drivers of drug development cost is the time and effort wasted on drugs that fail in human trials. New cancer drugs, for example, can take ten or twelve years to develop and cost over $2 billion, and 90% of the drugs fail to meet standards during human trials. If the drugs do not benefit a large enough percentage of trial patients, the drug research is usually abandoned.
Arun Asaithambi, founding CEO of Lantern Pharma, explained how the company uses AI to identify patients who do respond to failed drugs, and perform more targeted clinical trials. “Patients respond differently, which is why we have to have so many different drugs to treat the same conditions. If a patient does not respond to one, they try something else until something works. Until AI, finding the right drug has largely been a matter of trial and error. Start with the most common treatment that works on the largest number of people, and if the patient does not respond, try the next thing, and so on.”
“Cancer is a very personal disease,” he continued. “At Lantern, we identify the genetic signatures of clinical trial patients who responded favorably to the treatment, and use that information to screen patients with the same markers. Our artificial intelligence program uses billions of data points to identify the molecular markers of people who respond to the drug, and this information allows us to find the people who will benefit from the drug. Then we can get the clinical trials completed, and bring new drugs specifically targeted to a smaller patient group to market in a fraction of the time and at a much lower cost.”
Near future physicians will use these methods to run a genetic screening and identify the drug that will be most effective for you, specifically. That will mean stopping cancer earlier, which also means lower chance of relapse and much better odds of survival.
According to the Motley Fool, the orphan drug market is the second-fastest growing niche in the pharma industry. Top companies are expected to reap an astounding 15% growth rate, while the average overall rate of global prescription drug sales will rise at a compound annual growth rate, or CAGR, of 6.5% over the next 5 years.
3. Behavior Modification
Much in the same way your Fitbit monitors your exercise efforts, many kinds of medical apps and devices are hitting the market to monitor how and when you take your medicines, and whether you are engaging in high-risk behaviors.
SmokeBeat, for example, is a data-analytics app that integrates with your smartwatch or other wearable and uses “recognition of hand-to-mouth gestures in order to help people better understand their behavior and make life-affirming changes” - in other words, it tracks when you smoke, and knows the difference between smoking and snacking or brushing your teeth.
The app shows users how often they smoke, how much time they waste, and how much money they spend, along with other information designed to provide psychological incentives to smoke less.
A TechEmergence study on healthcare industry executives currently using AI revealed that over 50% anticipate broad scale AI adoption by 2025 and nearly half of participants expect that initial AI applications will target “chronic conditions.”
Since roughly 50% of Americans suffer from at least one chronic condition, AI adoption will likely have a major impact on your future health.
For investors, medical AI looks like a sound investment. McKinsey estimates that artificial intelligence in pharmaceuticals and medicine will add $100 billion per year to the market, with data-driven innovation, improved efficiency of research/clinical trials, and new tech to aid with every aspect from initial diagnosis to in-home compliance.