Bringing a drug to market can take more than 12 years and require investments in the range of 2 to 3 billion dollars. What’s more, the risk is particularly high since 90% of the molecules tested are not retained. AI is now turning this paradigm on its head thanks to its phenomenal data processing capability, significantly reducing the time and money spent on research.
"}},{"componentType":"paragraph","richBody":{"value":"In 2018, DeepMind, a subsidiary of Google, unveiled AlphaFold. This AI system is capable of predicting a protein’s 3D structure in just seconds from its amino acid sequence. This revolutionary tool has done away with a problem that had long been considered a stumbling block in molecular biology, enabling researchers to identify promising molecules more quickly.
"},"title":"A significant turning point in 2018"},{"componentType":"paragraph","richBody":{"value":"This health crisis accelerated the adoption of AI by pharmaceutical companies. During the COVID-19 pandemic, Pfizer, in association with BioTech, turned to AI to develop the Comirnaty vaccine, which was brought to market in less than two years. Until then, it took 10 years, on average, to get a new drug to market.
"},"title":"The pandemic of 2020-2021: the trigger"},{"componentType":"sectionTitle","title":"Global momentum driven by massive investments"},{"componentType":"paragraph","richBody":{"value":"Since the pandemic, the initiatives have multiplied, and several giants of the pharmaceutical industry have committed to investments and established partnerships with research groups in artificial intelligence.
Sanofi has signed a research collaboration worth around 5 billion dollars with Exscientia to develop up to 15 novel small molecule candidates in the fields of oncology and immunology.
Other groups such as Bayer, Roche, Merck and Novartis have also joined forces with start-ups specialising in machine learning algorithms.
"}},{"alignedImage":{"position":"bottom","extension":"jpg","original":"https://assets.ing.com/m/4dc8fa1514cf8bff/original/Grafiek-1-artikel-AI.jpg","transformBaseUrl":"https://assets.ing.com/transform/ebad9fcf-414e-4767-adf1-55d23e4a8b5d/Grafiek-1-artikel-AI"},"componentType":"paragraph","richBody":{"value":"At the time of writing, 25 of the top 50 pharmaceutical companies have already signed partnership agreements with AI companies.
According to Deep Pharma Intelligence, the cumulative investments of the top 800 AI-driven drug discovery companies have increased fourfold between 2019 and 2023 to nearly USD 60 billion.
The result? Millions saved in hours of research, accelerated clinical trials and huge revenue prospects. Morgan Stanley predicts that AI could contribute to discovering 50 new therapies by 2033, unlocking over USD 50 billion in value.
"},"title":"A surge in investment"},{"componentType":"sectionTitle","title":"AI has also revolutionised electricity"},{"alignedImage":{"position":"bottom","extension":"jpg","original":"https://assets.ing.com/m/450e195d3679eb6f/original/Grafiek-2-ENG-artikel-AI.jpg","transformBaseUrl":"https://assets.ing.com/transform/d77a49bd-df50-4993-bb2a-b5ce983725ce/Grafiek-2-ENG-artikel-AI"},"componentType":"paragraph","richBody":{"value":"
To adjust the flow of electricity based on supply and demand and to determine the price per kilowatt-hour, the various market players must process huge amounts of data every day.
This gigantic undertaking would be impossible today without the help of AI. Predicting the impact of cloud cover in Spain or rising temperatures in Germany on electricity prices in Belgium has become a highly complex task for trading companies.
In Europe, especially, interconnections between national grids are creating bottlenecks, and the supply of alternative energies is increasing continually. Algorithmic trading plays an invaluable part in this. In 2022, up to 60% of transactions on Epex, Europe’s largest power exchange, were done by computers!
"}},{"alignedImage":{"position":"bottom","extension":"jpg","original":"https://assets.ing.com/m/7457719b7d9a34bd/original/Grafiek-3-ENG-artikel-AI.jpg","transformBaseUrl":"https://assets.ing.com/transform/9ffb2da4-1644-4285-bf10-64a34ccbc218/Grafiek-3-ENG-artikel-AI"},"componentType":"paragraph","richBody":{"value":"
Avoiding power cuts, getting electricity to where it is most needed and managing the intermittent nature of alternative energy sources can be such a complex undertaking that extraordinary events may sometimes occur.
Like in Germany in early July 2023, where electricity prices briefly fell to an all-time low of -500 euros/ megawatt-hour (see visual). Why? Solar production far exceeded demand, and the surplus energy had to be sold cheaply, leading to a drop in prices.
In 2022, the war in Ukraine triggered several episodes of sudden volatility, with prices jumping to over €500 and €600/Mwh due to the risks associated with Russian fossil fuel supplies.
"},"title":"A valuable tool for managing volatility"},{"componentType":"paragraph","richBody":{"value":"
This type of volatility means electricity traders need to be better equipped to process the quantities of data required to monitor electricity production and consumption (satellite images, weather models, geopolitical context, social media, etc.) and anticipate price fluctuations. Even more so, considering that the daily trading volume on Epex has increased sevenfold in just five years!
"}},{"componentType":"paragraph","richBody":{"value":"AI’s capacity for analysis, processing and continuous learning is proving extremely valuable in such a dynamic electricity market. However, it is worth remembering that it is merely a tool: the final decisions are based on the expertise of experienced traders who are able to contextualise the collected data and anticipate exceptional situations.
The promise of artificial intelligence is great, but it is not infallible. In the energy sector, computer systems are not always reliable when faced with unforeseen events, such as excessive production or network defects.
"},"title":"Human still in the loop in decision-making"},{"componentType":"paragraph","richBody":{"value":"The challenge is therefore to constantly refine algorithms while maintaining human control. In healthcare, AI is still struggling to accurately predict the effectiveness and side effects of a drug. While it is very effective when it comes to agglomerating data from various sources, things become infinitely trickier when it is used for complex systems.
Laboratory experiments are thus often necessary to guarantee drug safety. Furthermore, the data used to create algorithms may contain biases that may be included in the clinical recommendations they generate, as documented by researchers at Stanford University.
"},"title":"The current limitations of AI"},{"componentType":"sectionTitle","title":"An investment opportunity"},{"componentType":"paragraph","richBody":{"value":"Whether for discovering new molecules or transporting electrons, AI, however imperfect it is, has emerged as a key technology for meeting the challenges of the 21st century. This prospect is a source of enthusiasm on the financial markets and encourages ING fund managers to incorporate this theme into their long-term investment strategy.
AI stocks have outperformed the global equity index by 120% (in euros) since 2022. Biotechnology and pharmaceutical stocks, meanwhile, have soared by more than 60% since the end of the COVID-19 pandemic.
"}},{"componentType":"sectionTitle","title":"We'd love to hear your story. Make an appointment here."},{"cards":[{"cardSize":"small","cardType":"service","componentType":"serviceCard","image":{"extension":"png","original":"https://assets.ing.com/m/7e02e75f5d5f534d/original/icon-Video-call-woman-spot.png","transformBaseUrl":"https://assets.ing.com/transform/67010ed0-a27d-4c66-b37c-a6bfb9a308c2/icon-Video-call-woman-spot","type":"image","width":847},"intro":"Leave us your details and we will get back to you!","link":{"url":"https://www.ing.be/en/individuals/services/contact-us-appointment?journey=invper&flow-step=call-me-back"},"title":"Want to find out more about Private Banking?"},{"cardSize":"small","cardType":"service","componentType":"serviceCard","image":{"extension":"png","original":"https://assets.ing.com/m/6e6f3de4c512a23f/original/Fingerprint-phone-hand-spot.png","transformBaseUrl":"https://assets.ing.com/transform/4c8f79aa-f653-430e-bd15-7a94e7640b59/Fingerprint-phone-hand-spot","type":"image","width":615},"intro":"Contact your Private Banker via the ING Banking app!","link":{"url":"/en/private-banking/contact/contact-us-private-banking"},"title":"Already an ING Private Banking client?"}],"componentType":"cards"}]},"hasMacro":false,"id":"820a377d-5004-4b3f-a345-1663e7f5059f","localeString":"en-GB","mainHeaderZone":{"backLink":{"textLink":{"text":"Insights for those who look further","url":"/en/private-banking/news"}},"componentType":"editorialHeader","coreHeader":{"headerImage":{"extension":"jpg","original":"https://assets.ing.com/m/4b51fadf189a6a6/original/A-young-man-examines-a-robotic-human-face.jpg","transformBaseUrl":"https://assets.ing.com/transform/3dc9df31-c701-4d6b-a2b9-d48e7e759f4a/A-young-man-examines-a-robotic-human-face","type":"image","width":1920},"subtitle":"Artificial intelligence (AI), a major technological advance in recent years, is revolutionising crucial sectors such as healthcare and energy. Discovering new medicines, managing power grids or algorithmic trading: AI is being harnessed in all these fields to unlock new horizons. Our experts discuss the most remarkable applications in the pharmaceutical industry and the electricity market.","title":"Health and energy in the age of artificial intelligence"},"date":"2025-04-16","readingTime":4},"publishDate":"2025-05-05T14:46:07.477+02:00"}}