Generative Artificial Intelligence (GenAI) in Healthcare Market Size and Growth Report 2025 to 2030

The Global Generative Artificial Intelligence (GenAI) in Healthcare Market is expected to witness a growth rate of 36-38% in the next five years. The rapid advancements in AI technology; increasing demand for precision medicine; increasing demand for efficient healthcare solutions; expanding venture funding and other investments in the AI sector; ability of generative AI to automate tasks, reduce errors, optimize treatment, and lowers costs; availability of vast amounts of healthcare data, including EHRs, medical imaging, and genomic data; and growing applications in drug discovery are some of the key factors driving the GenAI in Healthcare market growth. However, data privacy and security concerns; regulatory challenges; the high cost associated with development, deployment, and maintenance of generative AI system; and ethical concerns related to the use of AI in healthcare is likely to hinder the market's growth.

Generative AI, in the context of healthcare, refers to artificial intelligence systems and algorithms that have the capability to generate new, original data, content, or information related to healthcare. These AI systems use deep learning and neural networks to create data or content that is not explicitly programmed but is instead generated based on patterns and information learned from existing healthcare datasets.

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The Rapid Advancements in AI Technology to Drive Market Growth

The rapid advancements in AI technology are pivotal in driving the growth of generative AI in the healthcare market. Breakthroughs in deep learning, natural language processing (NLP), and neural networks enable AI systems to analyse vast amounts of medical data with unprecedented accuracy. These technologies facilitate the automation of complex tasks such as drug discovery, diagnostic imaging, and personalized treatment planning, improving patient outcomes and operational efficiency. Enhanced AI algorithms can predict disease progression, optimize treatment plans, and even generate novel therapeutic solutions tailored to individual patients. As these technologies continue to evolve, they reduce the time and cost of medical research and development, making advanced healthcare solutions more accessible. Consequently, the integration of cutting-edge AI technologies is transforming healthcare delivery, driving demand for generative AI applications, and fuelling market expansion.

"Advancements in AI, particularly in machine learning and deep learning, have significantly improved the efficiency and innovation in industries like healthcare. These technologies enable faster data processing, more accurate predictions, and the automation of complex tasks, which are crucial for accelerating growth"- Vice President, GenAI Product and Data Strategy, An AI Healthcare Company, United States

Expanding Venture Funding and Other Investments in the AI sector to Fuel Market Growth

Venture capital investment in artificial intelligence (AI) has surged in recent years, reaching record levels in 2024, with the generative AI (GenAI) sector particularly benefiting. In 2023, GenAI start-ups globally raised USD10 billion in venture capital, marking a 110% increase from 2021 (source: GlobalData). The sector is projected to receive over USD12 billion globally in 2024 (source: EY). The healthcare industry is emerging as a key focus for generative AI applications, with venture capitalists increasingly recognizing its transformative potential. This has led to significant financial investments, not only from VCs but also from major corporations. For example, Microsoft has invested over USD13 billion in OpenAI since their partnership began in 2019, integrating OpenAI's models across its product suite, including Azure, Bing, Teams, and Windows.

Other well-funded generative AI companies, like Jasper.ai, which raised USD125 million and achieved a USD1.5 billion valuation, are also contributing to the sector's rapid growth. These investments enable start-ups and established companies to accelerate the development and deployment of innovative AI-driven solutions in healthcare. Generative AI, with its capabilities in drug discovery, personalized medicine, and predictive diagnostics, offers significant opportunities to improve patient outcomes and reduce healthcare costs. Substantial venture funding supports research, talent acquisition, regulatory approvals, and partnerships, ultimately driving rapid adoption and market growth in the healthcare sector. The growing confidence of VCs in AI further attracts other investors, creating a positive feedback loop that continuously propels the generative AI healthcare market forward.

Technological Innovations are Driving the Generative AI in Healthcare Market

The Generative AI in Healthcare market is technology-driven and is marked by constant initiatives for product innovations. For instance,

In June 2024, Cognizant, in partnership with Google Cloud, launched healthcare-specific generative AI solutions to streamline administrative processes and improve patient care experiences. These AI-driven tools target high-cost workflows, enhancing efficiency, accuracy, and overall healthcare delivery

In April 2014, Augmedix launched Augmedix Go, the first fully-automated, generative AI-powered medical documentation product for emergency departments, following a successful pilot with HCA Healthcare. The solution aims to enhance patient care, reduce clinicians' documentation burden, and improve productivity by accurately automating medical notes in complex, noisy ED environments

In March 2024, NVIDIA launched over two dozen healthcare microservices, enabling global healthcare enterprises to leverage generative AI for advanced medical applications across any cloud platform. These microservices, including optimized AI models and development tools, accelerate healthcare workflows in drug discovery, medical imaging, and genomics, enhancing patient care and clinical interactions

In February 2024, Hartford HealthCare launched its Center for Artificial Intelligence (AI) Innovation in Healthcare to advance AI research and development in clinical care, collaborating with institutions like MIT and the University of Oxford. The center aims to lead AI-driven healthcare transformation by focusing on collaboration, trustworthiness, and innovation, building on Hartford HealthCare's existing AI initiatives

US Expected to be a Major Growth Engine in Generative AI in Healthcare Market

The US is expected to be a major growth engine in the Generative AI in healthcare market due to several factors. First, the country's robust healthcare infrastructure and advanced technology adoption create an ideal environment for AI integration. Major healthcare providers, such as hospitals and clinics, are increasingly embracing AI to enhance patient care, streamline administrative processes, and improve outcomes. Second, the US is home to leading AI companies, research institutions, and tech giants like Google, IBM, and NVIDIA, which are heavily investing in AI development and applications tailored for healthcare. This fosters innovation and accelerates the deployment of AI solutions in the medical field. Third, there is significant venture capital funding and government support for AI in healthcare, further driving market growth. Regulatory bodies like the FDA are also adapting frameworks to ensure the safe integration of AI technologies, encouraging more widespread adoption. Overall, the US combines technological leadership, investment, and a supportive regulatory environment, making it a key driver in the global Generative AI healthcare market.

Growth in the APAC generative AI in healthcare market is driven by the rapid adoption of digital health technologies and AI-powered solutions across the region. Significant investments from both private and public sectors are fuelling innovation, while supportive government policies and initiatives are enhancing healthcare infrastructure, making the region a key area for AI-driven healthcare advancements. Additionally, a growing focus on personalized medicine and improving healthcare access in densely populated areas further accelerates market growth.

Application Type Segment Analysis
The generative AI in Healthcare market comprises application types like: Drug Discovery and Development, Medical research and data analysis, Medical Imaging and Diagnostics, Patient Assistance and Monitoring, Personalized Medicine, Clinical Decision Support, Healthcare Operations, Predictive Analytics and Other Applications. Drug Discovery and Development is the largest segment due to the extensive use of AI in accelerating the discovery of new drugs, optimizing clinical trials, and reducing time-to-market. This segment benefits from AI's ability to analyze large datasets, simulate drug interactions, and predict outcomes more efficiently. Growth in the patient assistance and monitoring segment is driven by the rapid advancements in AI-driven virtual assistants and remote monitoring technologies. AI tools are increasingly being used to provide real-time health support, enhance patient engagement, and monitor chronic conditions, making this segment particularly dynamic. The rise in telehealth and wearable devices further contributes to its expansion.

End User Type Segment Analysis

The generative AI in Healthcare market can be analyzed based on end user types, such as Pharmaceutical & Biotechnology Companies, Medical Device Companies, Healthcare Payers, Academic & Research Institutes, and Other End Users. Pharmaceutical & biotechnology companies represent the largest segment. This is due to their extensive use of AI in drug discovery, development, and clinical trials. AI helps these companies streamline processes, enhance precision in drug targeting, and reduce costs, making them the primary adopters of generative AI technologies. The growth in the healthcare providers segment for AI in healthcare is driven by the need for improved patient care and operational efficiency. AI aids in automating administrative tasks, enhancing diagnostic accuracy, and personalizing treatment plans. This technology supports real-time data analysis and decision-making, leading to better patient outcomes and streamlined workflows, thus fueling its adoption among healthcare providers.

Organic and Inorganic Growth Strategies Adopted by Players to Establish Their Foothold in the Market

Players operating in this market are adopting both organic and inorganic growth strategies such as collaborations, acquisitions, and new product launches to garner market share. For instance,

In July 2024, GE HealthCare and Amazon Web Services (AWS) formed a strategic partnership to develop generative AI applications aimed at enhancing medical diagnostics and patient care. GE HealthCare will use AWS's cloud and AI services to create innovative solutions that improve clinical workflows, diagnostic accuracy, and patient outcomes, accelerating the development and implementation of new healthcare technologies

In March 2024, Google Cloud integrated its Vertex AI Search with MedLM and Healthcare Data Engine (HDE) to enhance generative AI healthcare services, improving patient record summaries and access to longitudinal data. The updates include expanded HDE access, new MedLM features for chest x-ray classification, and a data mapping tool, aiming to advance AI-driven healthcare solutions while addressing potential issues with AI credibility

In February 2024, CitiusTech launched, the CitiusTech Gen AI Quality & Trust solution, a pioneering solution to enhance the reliability, quality, and trust of generative AI in healthcare, addressing common concerns that delay AI adoption. The solution offers a comprehensive framework with metrics and methods tailored to healthcare, enabling organizations to confidently scale Gen AI applications

In November 2023, Wipro partnered with NVIDIA to enhance healthcare solutions using generative AI, leveraging NVIDIA's AI Enterprise software for improved member experience, enrolment, and claims processing. This collaboration aims to accelerate the adoption of AI in healthcare, enabling custom AI models and transforming digital and business processes in the industry

The generative AI in Healthcare market is expected to gain further momentum in the coming years due to technological advancements, rising R&D investments, new product launches, and aggressive organic and inorganic growth strategies followed by the players.

Competitive Landscape Analysis: Generative AI in Healthcare Market

The global generative AI in Healthcare market is marked by the presence of established market players such as Amazon Web Services, Cognizant, Google LLC, IBM Corporation, Meta, Microsoft Corporation, NVIDIA, OpenAI, Oracle Corporation, and Syntegra, among others.

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Future Outlook of the Generative AI in Healthcare Market

The global generative AI in Healthcare market is expected to gain further momentum in the coming years due to its abilities to create synthetic datasets that for training machine learning models; enhance patient engagement; streamline processes and improve efficiency; and the growing trend of collaboration between AI developers and healthcare professionals. These factors collectively contribute to the growth and evolution of the generative AI in healthcare market.

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Ruta Halde
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About Medi-Tech Insights

Medi-Tech Insights is a healthcare-focused business research & insights firm. Our clients include Fortune 500 companies, blue-chip investors & hyper-growth start-ups. We have completed 100+ projects in Digital Health, Healthcare IT, Medical Technology, Medical Devices & Pharma Services in the areas of market assessments, due diligence, competitive intelligence, market sizing and forecasting, pricing analysis & go-to-market strategy. Our methodology includes rigorous secondary research combined with deep-dive interviews with industry-leading CXO, VPs, and key demand/supply side decision-makers.

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