India's pharmaceutical industry is increasing its use of artificial intelligence in drug discovery as companies seek to improve research and development and keep pace with global peers. The technology is also being deployed in clinical trials, manufacturing, regulatory affairs, pharmacovigilance and personalised medicine.
AI is helping researchers identify drug targets, screen molecules and predict toxicity, reducing work that previously took years. However, India's investment in AI-led drug discovery remains far below that of larger global markets despite the country's position as the world's third-largest pharmaceutical producer by volume.
Funding Gap
The global market for AI in the pharmaceutical and biotechnology sectors is estimated at $8.54 billion in 2026 and is projected to reach $154 billion by 2034. India's market, by comparison, is estimated at $0.17 billion in 2026, or about 2% of the global total.
China committed more than RMB 10 billion, or about $1.4 billion, to AI-pharma initiatives in 2026 alone. India has no comparable government programme. In 2024, India attracted about $320 million in AI-pharma funding, with most of the capital directed towards improving generic medicines rather than developing new drugs.
India's domestic pharmaceutical market is expected to expand from about $55 billion in 2025 to $120 billion-$130 billion by 2030, according to an ASSOCHAM outlook. Most of that growth is expected to come from generics, biosimilars and exports rather than AI-developed medicines.
"AI is rapidly transforming the pharmaceutical sector from a traditionally process-driven industry into a data-driven and predictive one," Vaibhav Koul, managing director at Protiviti Member Firm for India, said.
Industry Focus
Indian pharmaceutical companies are adopting AI in different parts of their businesses.
Sun Pharma, India's largest drugmaker by revenue, has focused on manufacturing quality and supply chain optimisation rather than drug discovery. Cipla has integrated AI into smart inhalers and diagnostics. Biocon is investing in protein modelling and genomics-based cancer therapies through its Syngene subsidiary, while Glenmark is using AI for tumour profiling. Lupin operates an R&D centre near Pune with more than 1,400 scientists working on AI-assisted discovery and manufacturing.
An EY-Parthenon and OPPI report found that Indian pharmaceutical executives increasingly view AI and machine learning as growth drivers. The report said 86% of industry leaders want stronger collaboration among startups, academia and pharmaceutical companies to expand AI capabilities. It also projected the Indian pharmaceutical market could reach $450 billion by 2047 from about $55 billion today.
According to EY, half of the world's leading life sciences companies have established Global Capability Centres in India, with these centres increasingly supporting strategic research and development rather than only cost-saving operations.
Deloitte's 2026 enterprise survey of 3,235 business leaders across 24 countries found that 40% of respondents in India reported significant or full AI adoption, compared with a global average of 28%. India also ranked first among 15 countries surveyed for the use of AI in strategic decision-making.
Globally, more than $2 billion was invested in AI drug discovery startups in 2025, alongside 168 new strategic partnerships between AI and pharmaceutical companies.
Sun Pharma's GPT-4-powered sales analytics platform, developed with GoML using Microsoft Autogen and OpenAI, reduced the time needed to generate sales insights by about 85%, although the application is focused on commercial operations rather than drug discovery.
Dr. Reddy's-owned Aurigene, a contract development and manufacturing organisation employing about 1,200 scientists, has outlined plans to invest nearly $100 million in infrastructure covering biologics and AI-driven drug discovery. The company also says antibody drug discovery is one of its key strengths.
"The global pharma GCCs in India are also evolving from support centers into AI-driven innovation hubs supporting research, clinical, and commercial functions," Koul said.
The global pharmaceutical industry has also expanded collaborations with AI companies. Novartis Chief Executive Officer Vas Narasimhan recently joined Anthropic's board, while Eli Lilly and NVIDIA announced a joint AI laboratory in January.
NVIDIA Chief Executive Officer Jensen Huang said the partnership represented "a new blueprint for drug discovery, where scientists can explore vast biological and chemical spaces in silico before a single molecule is made."
Lilly Chief Executive Officer David Ricks said the collaboration could "reinvent drug discovery as we know it."
The article noted that Indian pharmaceutical companies have yet to announce partnerships of a similar scale with major AI firms.
Despite growing investment, challenges remain. Several AI drug discovery startups reduced staff or shut down after Phase II clinical failures in 2025. No AI-designed drug has yet reached the market anywhere in the world.
The global AI drug discovery market, estimated at $8 billion-$10 billion this year compared with $5 billion-$7 billion in 2025, still represents a small share of the pharmaceutical industry's overall research and development spending.
India continues to benefit from its manufacturing base, expertise in chemical synthesis and expanding Global Capability Centre workforce. However, investment in AI-led drug discovery remains well below the level seen in global pharmaceutical companies and China's state-backed initiatives.
Disclaimer: The views expressed in this article are solely those of the author and do not necessarily reflect the opinion of NDTV Profit or its affiliates. Readers are advised to conduct their own research or consult a qualified professional before making any investment or business decisions. NDTV Profit does not guarantee the accuracy, completeness, or reliability of the information presented in this article.
Essential Business Intelligence, Sharp Market Insights, Practical Personal Finance Advice, Daily Fuel, Gold and Silver Prices and Latest Stories — On NDTV Profit.
