The Birthplace of Biotech

For many, the name California conjures images of agriculture, Hollywood filmmaking, wine making, or tourism, yet, according to Tim Scott, the new president and CEO of Biocom California: “Even combined, the output of these four well-known industries does not match the massive, vital industry that is the California life sciences sector… From the cross-pollination opportunities between tech and biotech companies in the Bay Area, to the unsung med-tech sector in Orange County and the highly collaborative San Diego ecosystem that spawns hundreds of new companies each year, all are found here.”

The San Francisco Bay Area stands as a pivotal nexus where biotechnology and technology converge. Being at the heart of both biotech and tech, San Francisco makes it near impossible for the two industries not to rub against each other, and when they do, a spark ignites, setting fire to the pharmaceutical landscape. Over 40% of life science startups in the region incorporated AI or machine learning in their core technology in 2023, according to Foothold America.

Proximity to world-class research institutions like UCSF, Stanford and UC Berkeley ensures a steady flow of cutting-edge discoveries and collaborations. These institutions collectively filed over 600 biotech-related patents and received US$2.4 billion in NIH funding in 2023 alone. South San Francisco hosts over 250 biotech companies within 12 million square feet of dedicated space, making it one of the largest biotech clusters globally. This interconnected network fosters partnerships between startups, established firms and academic research centers, driving innovation in areas like synthetic biology, gene editing and software as medical devices.

QB3, one of four California Institutes for Science and Innovation, currently runs the Bakar Bio Labs incubator, and will launch an additional two in the coming years. “Computation, data science, machine learning and artificial intelligence are increasingly playing a larger role in biotech,” said David Schaffer, director of QB3. “Within our first incubator, we have seen an increasing number of companies working at the interface of machine learning and biotechnology.”

Venture capital plays a pivotal role in sustaining this growth. In 2024, life sciences companies in the Bay Area raised US$7.7 billion in venture capital across 79 deals, reflecting a slight increase from US$7.5 billion in 2023.Investors in the Bay Area are known for their risk tolerance and long-term vision, enabling early-stage companies to secure 40% more seed funding than the national average in 2023. This financial ecosystem supports the rapid adoption of AI/ML technologies across drug development stages—from patient stratification in clinical trials to optimizing pharmaceutical manufacturing processes.

The Bay Area’s culture of innovation is further exemplified by initiatives like Biocom California’s ‘Converge,’ which connects leaders from tech and life sciences to accelerate breakthroughs in healthcare solutions. Companies such as NVIDIA, Insitro and Tempus AI are spearheading efforts to harness big data for drug discovery, wearable diagnostics, telehealth improvements and implantable technologies. As biotech firms continue to integrate Silicon Valley’s computational expertise into their operations, they are reshaping traditional paradigms of drug development while addressing global healthcare challenges.