Siemens grows its digital twin strategy into life sciences market

Siemens has agreed to acquire Dotmatics, the developer of a data platform for scientific research, taking it into the life sciences market.

Siemens plans to combine Dotmatics’ drug research and development applications with its manufacturing industry expertise to create an AI-powered research-to-manufacturing digital thread for the life sciences vertical, the company said in a slide deck aimed at investors.

Rohit K, practice director at Everest Group, said the companies’ combined offering will provide their joint customers with predictive modeling, faster iteration cycles, and stronger regulatory compliance—ultimately accelerating time-to-market.

Siemens sees the deal as an opportunity to extend the reach of the digital twin software it has been developing into the market for drug discovery.

Its digital twin software platform is operated by subsidiary Siemens Digital Industries Software, an arm that also sells software bringing together the worlds of IT and OT (operational technology) including tools for low-code software development (Mendix) and IoT management (MindSphere), electronics design, manufacturing, product lifecycle management (PLM), and simulation.

The company has been building out a platform named Xcelerator, a portfolio of open, interoperable IoT-enabled hardware, software, and digital services, to market its digital twin offerings.

In 2022, Nvidia jointed the partner ecosystem for Xcelerator to help enterprises build photorealistic digital twins of their products and production processes, and view and manipulate those twins in real-time.

PLM portfolio

The Dotmatics acquisition will add to the AI-powered PLM software portfolio of Xcelerator.

Nishant Udapa, also of Everest Group, said that the digital twin software, combined with Dotmatics’ existing data tools, could allow scientists to explore multiple possible drug discovery approaches virtually, instead of conducting physical experiments.

“The AI in Siemens solution will provide recommendations on potential workflows and drug combinations that scientists can explore,” Udupa said.

The analysts don’t expect Siemens’ $5.1 billion acquisition of Dotmatics to affect customers’ access to the company’s platform.

“Current customers of Dotmatics products should not be impacted by pricing changes, though Siemens will undoubtedly use the access to these customers to try and sell its broader manufacturing platform solution,” said Udapa.

He said Siemens may soon start offering an end-to-end integrated solution to new life sciences customers, who are likely to see a price hike if they opt only for a point solution instead of a holistic solution.

Dotmatics offers scientific applications such as Prism, SnapGene, Geneious for data analysis, visualization, and workflow automation along with Luma, an AI-powered multimodal platform for collaboration between scientists aimed at harmonizing data capture.

Nearly 67% of Dotmatics’ $310 million estimated revenue for this fiscal year is expected to come from the scientific applications and the rest from Luma.