Sector Report 2026: Pharmaceuticals

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The pharmaceutical sector is set for sustained growth driven by demographic trends. An aging global population—now averaging a life expectancy of over 73 years—is increasing long-term demand for chronic disease treatments and age-related therapies. Meanwhile, the world population, projected to reach 8.5 billion by 2030, continues to heighten exposure to infectious diseases, requiring ongoing investment in new drugs and vaccines to support global health needs.
Industry dynamics are shifting as drug approval processes accelerate and new therapeutic categories expand. Faster FDA approvals are helping innovative treatments enter the market more quickly, and anti-obesity drugs have emerged as a major revenue engine, forming a fast-growing oligopoly due to rising global obesity rates. At the same time, branded drugmakers face mounting competitive pressure as more patents expire, enabling generic entrants to erode revenues by up to 80%.
Competition is also growing in the biopharmaceutical space, where advanced but costly biologic drugs increasingly face challenges from more affordable biosimilars. Across the value chain, artificial intelligence is playing an expanding role by automating and accelerating drug discovery, clinical trials, and commercialization, improving efficiency and reducing time-to-market for new therapies.