Pharma giants double down on AI in race to slash drug development costs

Pharmaceutical companies have sharply accelerated their embrace of artificial intelligence, striking a wave of partnerships and acquisitions since the start of 2025 as they seek to compress drug development timelines and reduce costs through automation and advanced molecular modelling.

Industry forecasts suggest that deploying machine learning across target discovery, molecular design and clinical trial planning could halve early-stage development timelines and associated costs within three to five years — a prospect that has prompted an unprecedented burst of dealmaking across the sector.

Eli Lilly (LLY) has been among the most aggressive movers, partnering with Nvidia (NVDA) in a deal worth up to $1bn over five years to build a closed-loop AI and robotics discovery laboratory, while also licensing its proprietary TuneLab platform to smaller biotechs. Pfizer (PFE) has assembled a portfolio of AI alliances spanning molecular design and drug discovery, committing up to $610mn in potential payments to PostEra alone.

AstraZeneca (AZN) has pursued both partnerships and outright acquisitions, acquiring AI modelling specialist Modella to deploy foundation models across its oncology pipeline, and joining a consortium with Illumina (ILMN), Merck (MRK) and Lilly to launch the Billion Cell Atlas, a large-scale dataset intended to underpin AI model training. Novo Nordisk (NVO) struck a partnership with OpenAI in April 2026 to deploy AI across operations spanning drug discovery to manufacturing.

Bristol Myers Squibb (BMY) has taken a broad approach, forming alliances with Anthropic — making Claude available to more than 30,000 employees — as well as Nvidia and Schrödinger, before signing a further deal with Chai Discovery in August 2026 to support the discovery of therapeutic antibody candidates across its pipeline.