99 per cent of life sciences leaders expect AI to drive revenue management value in 2025: Report

Model N’s 2025 State of Revenue Report reveals shifts toward use of generative AI and automation to bolster pharmaceutical, medtech, and high-tech revenue programs

Model N published its seventh annual State of Revenue Report, highlighting how executives in these industries are transforming their revenue operations. The report reveals that while 87 per cent of industry leaders are shifting toward automated revenue management operations, nearly 60 per cent still rely on multiple solutions. Additionally, 62 per cent are using or planning to implement generative artificial intelligence (GenAI) for revenue optimisation activities, including deal analytics, process automation, and forecasting.

This gap between automation goals and system integration presents both a challenge and an opportunity. The research found that companies with more than 10,000 employees are 51 per cent more likely than smaller organisations to use a unified revenue management solution. 

Suresh Kannan, Model N Chief Product Officer said, “Life sciences and high-tech manufacturers are using advanced technologies to automate and optimise revenue operations with data-driven insights. This year’s State of Revenue Report highlights the value of integrating GenAI for revenue management and transitioning to a unified solution. By harnessing AI and consolidating platforms, organisations can unlock greater revenue optimisation opportunities, boost efficiency, and drive growth.”

Pharma companies are modernising their revenue management approach to navigate a complex regulatory landscape. Pricing strategy is pharma leaders’ highest priority for revenue management-related strategic investment over the next two years. Eighty-seven percent of leaders report that they have already adjusted their launch plans in response to the Inflation Reduction Act (IRA).

State-level regulations like price transparency mandates and affordability boards are also a significant focus, with 76 per cent of leaders concerned about how the regulatory changes may impact revenue management. Automation and technology, including GenAI, are key enablers, with 62 per cent of pharma companies using or planning to use GenAI to strengthen revenue operations.

The medtech sector is undergoing a similar transformation. Regulatory changes like healthcare price transparency (45 per cent) and the European Union’s implementation of the Medical Device Regulation (MDR) (40 per cent) top the list of impacts on revenue programs. Nearly two-thirds of medtech companies are already seeing shifts as AI and automation are integrated into healthcare operations, and leaders are beginning to incorporate these approaches into their own company’s revenue optimisation and compliance processes. Looking ahead, 38 per cent of leaders are focusing on adapting to value-based care models, expecting further impacts on revenue optimisation functions.

High-tech companies are advancing their use of channel data – in fact, 87 per cent regularly use channel sales data to inform price management and optimisation processes. This industry leads in applying new technology to business processes, with 74 per cent of high-tech manufacturers planning to implement GenAI solutions – the highest rate across industries surveyed in the State of Revenue Report.

Supply chain disruption continues to influence strategy, prompting 53 per cent of companies to diversify suppliers, 51 per cent to deploy new technologies, and half to implement sustainability initiatives. Additionally, 95 per cent of high-tech leaders express concerns about grey market sales, implementing measures such as removing unauthorised sellers and enhanced contract enforcement.