Certara: Leading in Biosimulation and on the Path to Further Growth

Artificial intelligence is often associated with large technology corporations and semiconductor firms that garner immense profits from the explosive rise in AI usage. However, the healthcare sector is also poised for breakthroughs and significant returns. In the context of a decades-long shortage of medical professionals, AI-supported technologies could provide much-needed relief. Particularly promising fields include robotics, medical devices, and drug discovery. Hologic CEO Steve MacMillan recently discussed the positive impacts of AI on the healthcare industry on CNBC's "Squawk on the Street," highlighting how AI can help alleviate the shortage of medical personnel. Against this backdrop, Certara comes into focus. The company, based in Princeton, New Jersey, is a leader in biosimulation software to accelerate drug development. Biosimulation uses computer-based models of biological processes to simulate the behavior of a drug in the human body, making the selection of the most promising compounds more efficient and accurate. In 2023, Certara enhanced its software with AI functions, specifically customized GPTs that can better understand scientific concepts and validate targets more effectively. Certara's model leverages customer data and a library of about 60 million life science research documents, accelerating clinical outcomes. These technological advancements are expected to boost the company's growth by 10% in 2025, with Certara already generating $60 million in free cash flow annually. In the second quarter, eleven hedge funds held shares in Certara with a total value of $18.4 million. Boone Capital was the largest shareholder with 718,983 shares. Certara ranks 9th on the current list of the best medical AI companies. While Certara offers promising growth opportunities, there are other AI stocks with higher potential and faster revenue development.