AI in Medical Diagnostics Market To Hit USD 10.6 Billion by 2033

Trishita Deb
Trishita Deb

Updated · Mar 25, 2024

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Introduction

The AI in Medical Diagnostics Market is a rapidly growing industry that is expected to reach USD 10.6 billion by 2033, with a CAGR of 25.2%. The increasing adoption of AI technologies in healthcare is driving this growth, as it enhances diagnostic accuracy, streamlines operations, and facilitates more personalized patient care. With the rising prevalence of chronic illnesses globally and a shortage of healthcare workers, estimated at 4.4 million worldwide, AI has become a critical tool in addressing the burgeoning healthcare demands.

The integration of big data and AI in healthcare is instrumental in managing the vast amounts of data generated by the healthcare sector, thus enhancing diagnostic processes and outcomes. Software solutions, holding a dominant market share due to their crucial role in diagnostics, have been fuelled by the growing need for accurate, efficient diagnostic tools and the continuous advancements in AI technology. In 2023, software components commanded the market with a 54% share, demonstrating the increasing reliance on AI-powered solutions in diagnostics.

Recent collaborations and partnerships in the AI in Medical Diagnostics sector have shown significant investments aimed at enhancing cancer care, diagnostics, and patient outcomes through AI technologies. For instance, Microsoft and Paige partnered to build the world’s largest image-based AI model for digital pathology and oncology. The project aims to incorporate up to 4 million digitized microscopy slides across various cancer types into a new AI model for use by hospitals and labs, leveraging vast data to enhance diagnostics and treatment strategies.

Another significant acquisition in the industry was Boston Scientific’s purchase of Axonics for $3.7 billion, aimed at expanding its presence in the incontinence treatment market. This acquisition is seen as a high-growth addition to Boston Scientific’s urology business, indicating the strategic moves companies are making to consolidate and expand their technological capabilities and market reach.

Roche also acquired LumiraDx’s point-of-care technology for $295 million, reflecting the ongoing demand for and investment in diagnostic technologies that offer rapid and accessible testing solutions. This move by Roche is particularly aimed at strengthening its diagnostics division amidst financial pressures faced by LumiraDx.

Key Takeaways

  • The AI in Medical Diagnostics Market was valued at USD 1.1 billion in 2023 and is projected to reach USD 10.6 billion by 2033, exhibiting a notable CAGR of 25.2% during the forecast period.
  • The software segment commands the largest share of the global AI in medical diagnostics market, comprising 54%.
  • Neurology emerges as the leading diagnostic type, capturing a market share of 28.9%.
  • CT scan holds a substantial market presence, contributing 42.6% to the AI in medical diagnostics market.
  • Hospitals dominate the end-user segment, accounting for 61.2% of the market share.
  • North America witnesses approximately 1.8 million cancer cases diagnosed in 2022, further emphasizing the need for advanced diagnostic solutions.
  • Google Cloud launched the ‘Medical Imaging Suite’ to make imaging healthcare data more accessible and interoperable.
  • Key players in the market include Butterfly Network Inc., Quibim, AiDoc, Siemens Healthineers, Google, HeartFlow Inc, Zebra Medical Vision, Neural Analytics, Digital Diagnostics, and GE Healthcare.
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AI in Medical Diagnostics Statistics

  • By July 2023, the FDA had approved over 700 AI healthcare algorithms, with radiology accounting for 76% of them. Radiology alone has 527 FDA-cleared algorithms, followed by cardiology (71), neurology (16), and hematology (14), among others. The significant increase in FDA clearances, particularly for radiology, highlights the growing role of AI in medical imaging and diagnostics.
  • The use of machine learning technologies in healthcare offers significant benefits, such as earlier disease detection and more consistent analysis of medical data. These technologies are being developed for a range of diseases, including certain cancers, diabetic retinopathy, Alzheimer’s disease, heart disease, and COVID-19, mostly using data from imaging techniques like X-rays or MRI. Despite their potential, these technologies have not been widely adopted yet.
  • The integration of AI in patient diagnostics is transforming healthcare, enhancing the efficiency, accuracy, and personalization of diagnosis. AI-driven diagnostic tools, particularly those interpreting medical images, are becoming indispensable in healthcare. These tools have led to FDA approvals in hundreds of cases, especially in radiology, highlighting AI’s significant impact on healthcare delivery.
  • The NHS has received a £21 million fund to speed up the deployment of AI tools across hospitals. This initiative aims to improve the diagnosis and treatment of conditions such as cancers, strokes, and heart conditions. AI stroke-diagnosis technology is expected to be available in all stroke networks by the end of 2023, with AI tools already making a significant impact in diagnosing conditions earlier.
  • The deployment of medical AI systems in routine clinical care presents an important opportunity. Over 48% of hospital CEOs and strategy leaders are confident that by 2028, health systems will have the infrastructure in place to utilize AI in augmenting clinical decision-making. The focus is on human-centered AI design to enhance traditional care delivery.

Use Cases

  • Patient Safety Enhancements: AI contributes significantly to patient safety by evaluating data to produce insights that improve decision-making and health outcomes. AI systems can improve error detection, stratify patients, and manage drug delivery, ultimately aiming to identify diagnoses, problems, or risks earlier to change the trajectory of patient outcomes for the better.
  • Drug Discovery and Development: AI is revolutionizing the pharmaceutical industry by accelerating drug discovery and development processes. Through analyzing vast datasets, AI can predict which drug formulations may be most effective, thereby reducing the time and cost associated with bringing new drugs to market.
  • Personalized Medicine: Leveraging AI, clinicians can offer personalized treatment plans based on an individual’s genetic makeup, lifestyle, and environment. AI analyzes patient data to predict more accurately how they will respond to certain treatments, allowing for more personalized and effective care.
  • Stroke Diagnosis Improvement: In the UK, the National Health Service (NHS) has been allocated £21 million to deploy AI technologies across hospitals, significantly aimed at improving stroke diagnosis. The goal is to utilize AI decision support tools in all stroke networks by the end of 2023, which is expected to facilitate faster treatment for stroke victims by improving diagnosis and access to treatment.
  • Cancer Detection: AI is increasingly being used to enhance the detection and diagnosis of various cancers. One area where AI shines is in the analysis of imaging scans, such as chest X-rays and CT scans, for the early detection of lung nodules indicative of lung cancer. With over 600,000 chest X-rays performed monthly in England alone, AI tools are aiding clinicians in diagnosing cancer patients earlier, thereby improving patient outcomes.
  • Clinical Decision Support: AI algorithms play a crucial role in clinical decision support by analyzing vast amounts of patient data to assist medical professionals in making more informed care decisions. These AI-powered tools are outperforming traditional methods and tools like the Modified Early Warning Score (MEWS), commonly used to calculate the risk of clinical deterioration in patients over the next several hours.
  • Diagnostic and Imaging Analysis: AI’s application in diagnostics, especially imaging, is profound. AI algorithms assist radiologists by augmenting their clinical decisions, notably in detecting lung nodules on CT scans and improving breast imaging. Nearly 400 FDA-approved AI algorithms are currently in use within the radiology field, helping process the massive amounts of data generated by approximately 3.6 billion imaging procedures performed annually.

Recent Developments

  • Technological Innovations and Market Expansion: AI-driven medical imaging technologies have seen substantial advancements, particularly in integrating RTI software with imaging devices like MRI or CT scanners to automate medical image processing. This integration facilitates earlier detection, better diagnosis, and personalized care for patients. The deep learning technology segment has notably dominated the market due to its application in radiological procedures, including object detection and image segmentation.
  • Growth in Application Segments: The neurology segment has notably held a significant share of the market due to AI’s role in enhancing accuracy, patient care, and efficiency in neurology-related diagnostics. Similarly, the breast screening segment is anticipated to grow rapidly, driven by an increase in breast cancer cases and patient demand for early-stage diagnosis.
  • Expansion of Modality and End-use Segments: The CT scan segment, renowned for its comprehensive data collection compared to other methods, dominated the market. Hospitals, as a primary end-use segment, have emerged as major adopters of AI in medical imaging, attributed to their convenience and comprehensive service offerings.
  • Strategic Collaborations and Innovations in Healthcare AI: In recent strategic developments, Amazon Web Services and Slalom, LLC formed a collaboration to develop AI-powered solutions across various industries, including healthcare. Microsoft’s acquisition of Nuance Communications is another pivotal development aimed at enhancing healthcare solutions with conversational AI and ambient intelligence. NVIDIA Corporation introduced the Nuance Precision Imaging Network, leveraging AI for diagnostic imaging across healthcare systems.

Key Players Analysis

Butterfly Network Inc.

Butterfly Network Inc. is a leading company in the AI-powered Medical Diagnostics sector, especially with their innovative ultrasound technologies. Founded by Dr. Jonathan Rothberg, Butterfly Network has revolutionized medical imaging with the world’s first handheld, single-probe whole-body ultrasound system, the Butterfly iQ+. This system leverages patented Ultrasound-on-Chip™ semiconductor technology, making high-quality ultrasound affordable, globally accessible, and intelligently connected.

One of Butterfly Network’s notable advancements is receiving clearance from FDA 510(k) for their AI-enabled Auto B-line Counter. This tool simplifies the evaluation of adults with suspected diminished lung function, using deep learning technology. With this tool, healthcare professionals can make faster and more informed treatment decisions at the point of care. It represents a significant leap from traditional manual counting processes to more consistent interpretations of B-lines, which are indicators of wetness in the lungs associated with various pulmonary air-space diseases.

Quibim

Quibim is a company that specializes in AI-powered medical diagnostics. They use advanced technology to transform medical imaging data into actionable insights that enhance patient outcomes. The company has vast datasets and strategic partnerships that put them at the forefront of the radiomics-enabled era of precision health.

One of Quibim’s latest products is QP-Liver, a platform that uses AI-driven MRI analysis to revolutionize the diagnosis and management of diffuse liver diseases. QP-Liver provides automated liver segmentation and precise quantification of tissue fat and iron levels. This platform offers early disease detection, personalized treatment planning, and accurate monitoring, improving patient care outcomes. QP-Liver’s launch is a significant milestone in liver disease diagnostics and shows Quibim’s mission to transform imaging into a catalyst for precision health across various medical specialties.

AiDoc

Aidoc is revolutionizing healthcare with AI, focusing on alleviating physician burnout and enhancing radiology diagnostics. Their solutions analyze imaging to identify abnormalities rapidly, incorporating 17 FDA-cleared algorithms across various pathologies. This technology supports radiologists by managing increasing imaging volumes, prioritizing urgent cases, and streamlining workflows. Aidoc’s commitment to integrating AI into medical practice aims to improve diagnosis reliability and reduce the administrative burden on physicians, ultimately leading to better patient care outcomes.

Siemens Healthineers

Siemens Healthineers is advancing healthcare through its portfolio of over 70 AI-powered solutions. These innovations are designed to address the growing demand for diagnostic services, which currently outpaces the available expert workforce. By leveraging AI, Siemens Healthineers aims to automate and standardize workflows and diagnostics, making treatment decisions more objective and tailored to individual patient needs. This integration of AI into healthcare is pivotal for transforming care delivery, expanding precision medicine, and enhancing the patient experience.

Google

Google Health is pioneering AI-enabled imaging and diagnostics, focusing on assisting clinicians with robust tools. Through collaborations with healthcare organizations worldwide, Google Health leverages diverse datasets, high-quality labels, and advanced deep learning techniques to develop models aimed at supporting medical specialists in disease diagnosis. This research is pushing the boundaries of what was previously thought possible in diagnostics, demonstrating AI’s transformative potential in healthcare.

HeartFlow Inc.

HeartFlow Inc. has distinguished itself in the AI in medical diagnostics sector, particularly in the field of cardiac care. The company has developed an innovative approach to diagnosing coronary artery disease (CAD) through its non-invasive HeartFlow FFR_CT Analysis, leveraging artificial intelligence to create personalized three-dimensional models of patients’ hearts. This technology enables clinicians to accurately assess and diagnose CAD by evaluating the impact of narrowed vessels on coronary blood flow. HeartFlow’s suite of technologies, including Plaque Analysis and RoadMap™ Analysis, marks a significant advancement in precision heart care, positioning HeartFlow as a leader in cardiac diagnostics.

In a landmark achievement, HeartFlow announced that it has surpassed the assessment of 250,000 patients for CAD, emphasizing its commitment to transforming cardiac care. The company’s technology is not only FDA cleared but also enjoys the recognition and adoption by more than 1,000 hospitals globally, including 80% of the top 50 heart hospitals in the United States. The recent developments in its product portfolio, such as the introduction of Plaque Analysis and RoadMap™ Analysis, further underscore HeartFlow’s dedication to innovation and excellence in healthcare. These tools have demonstrated significant improvements in diagnostic precision, turnaround times, and overall patient care.

Furthermore, HeartFlow’s collaboration with NHS England to integrate its AI-powered FFRct Analysis platform into the diagnostic process for coronary heart disease exemplifies the growing acceptance and reliance on AI in medical diagnostics. This partnership aims to set a new standard in diagnosing and treating heart disease, offering hope for a more efficient, less invasive approach to cardiac care. The inclusion of HeartFlow’s technology in the NHS’s MedTech Funding Mandate highlights its potential to improve patient care while reducing costs.

Digital Diagnostics

Digital Diagnostics, a company transforming global healthcare through AI, is pioneering in developing autonomous AI systems like LumineticsCore™ for diagnosing diabetic retinopathy. Their mission is to make healthcare more affordable, accessible, and of higher quality through the automation of medical diagnosis and treatment, emphasizing equitable patient outcomes. By enabling disease detection at the point of care traditionally requiring specialists, their AI systems are aligned with clinical practices and are explainable, ensuring that healthcare professionals understand how AI reaches its decisions.

The journey of Digital Diagnostics showcases the industry’s challenges and potential pathways to success. Addressing healthcare’s productivity gap, identified by their founder Dr. Michael Abramoff, they leverage AI to automate healthcare tasks, thereby enhancing access, lowering costs, and improving overall healthcare quality. Their first autonomous AI system, IDx-DR, is a testament to their innovative approach, diagnosing diabetic retinopathy and other conditions autonomously, thus facilitating more accessible and equitable healthcare.

Conclusion

The AI in Medical Diagnostics Market is set for remarkable growth, driven by technological advancements, the increasing burden of chronic diseases, and the imperative for efficient, accurate diagnostic solutions. Despite challenges, the potential for AI to revolutionize healthcare diagnostics is immense, promising significant improvements in patient care and health outcomes.

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Trishita Deb

Trishita Deb

Trishita has more than 7 years of experience in market research and consulting industry. She has worked in various domains including healthcare, consumer goods, and materials. Her expertise lies majorly in healthcare and has worked on more than 400 healthcare reports throughout her career.