Simulations Plus, Inc.

Simulations Plus, Inc. is a leading provider of modeling and simulation software and consulting services primarily for the biopharmaceutical industry. The company's mission is to create value for its customers by accelerating the discovery, development, and commercialization of pharmaceuticals and other products through innovative science-based software and consulting solutions. Headquartered in Research Triangle Park, North Carolina, U.S., Simulations Plus has been committed to improving quality of life through its solutions for over 30 years. [3, 5, 6, 9, 12, 13]

The company operates through two main segments: software and services. Its comprehensive offerings include biosimulation software and solutions that bridge artificial intelligence (AI) and machine learning (ML), physiologically based pharmacokinetics (PBPK), quantitative systems pharmacology/toxicology, and population PK/PD modeling approaches. Key software products in its portfolio include GastroPlus®, MonolixSuite™, ADMET Predictor®, DILIsym®, and Thales™. These advanced technologies are licensed and utilized globally by major pharmaceutical, biotechnology, chemical, and consumer goods companies, as well as regulatory agencies worldwide. [2, 4, 6, 11, 13, 14]

Simulations Plus is recognized as a global leader in model-informed and AI-accelerated drug development. Recent strategic initiatives include collaborations with large pharmaceutical companies to advance AI workflows across the drug development lifecycle, integrating AI within scientifically grounded modeling frameworks. The company has also undergone leadership changes and a restructuring plan in 2025, with Shawn O'Connor serving as Chief Executive Officer. Simulations Plus continues to report financial results and engage in partnerships to advance predictive frameworks and the responsible deployment of AI in drug development. [5, 8, 10, 11, 14]

Latest updates

Simulations Plus, Lonza, FDA Partner to Modernize Drug Bioequivalence Assessment

Event summary

  • Simulations Plus, Lonza, and the FDA are collaborating on a funded research project.
  • The focus is on developing a predictive framework for complex oral drug products, specifically amorphous solid dispersions (ASDs).
  • The collaboration aims to reduce reliance on clinical bioequivalence (BE) studies using advanced in vitro systems and physiologically based biopharmaceutics modeling (PBBM).
  • Lonza will lead experimental work, while Simulations Plus will develop and validate modeling frameworks using its DDDPlus® and GastroPlus® platforms.
  • The initiative is partially funded by the FDA and seeks to align with evolving model-informed drug development (MIDD) priorities.

The big picture

The collaboration addresses a growing need within the pharmaceutical industry to streamline drug development and reduce the costs associated with clinical trials. Current bioequivalence assessment processes are resource-intensive and often lack predictive power, particularly for complex oral formulations like ASDs. This initiative represents a shift towards model-informed drug development (MIDD), which is gaining traction as a way to improve efficiency and transparency in the regulatory approval process, potentially impacting the timelines and costs for bringing new therapies to market.

What we're watching

Regulatory Adoption
The FDA's willingness to formally adopt and integrate the developed predictive framework into its regulatory processes will be crucial for widespread industry impact.
Model Validation
The robustness and accuracy of Simulations Plus’s IVIVE frameworks in predicting in vivo outcomes across diverse ASD formulations will determine the framework’s credibility and utility.
Commercialization
Simulations Plus’s ability to translate this collaboration into commercially viable AI-enabled workflows and expand its service offerings will be key to realizing long-term revenue growth.

Simulations Plus Spring School Draws Record Crowd, Signaling MIDD Adoption

Event summary

  • Simulations Plus' 2026 Spring School concluded March 27, 2026, with over 1,400 participants from 65 countries.
  • The program offered two tracks: GastroPlus® Spring School and MonolixSuite™ Spring School, focused on PBPK and pharmacometrics respectively.
  • The Spring School builds on Simulations Plus' existing educational initiatives, including Summer and Autumn Schools, and the University+ program.
  • Jonathan Chauvin, Co-Chief Product and Technology Officer, emphasized the importance of consistent model-informed approaches across teams.

The big picture

Simulations Plus' Spring School highlights the increasing importance of model-informed drug development (MIDD) as a standard practice within the biopharmaceutical industry. The program's scale—over 1,400 participants—underscores the growing demand for specialized training and expertise in this area, potentially reducing reliance on traditional, resource-intensive clinical trials. This trend positions Simulations Plus as a key enabler of a more efficient and data-driven drug development process.

What we're watching

Adoption Rate
The rapid growth in Spring School participation suggests accelerating adoption of MIDD, but the ability of biopharma companies to integrate these methods into core workflows remains to be seen.
Competitive Landscape
Simulations Plus' dominance in MIDD training could attract competitors, potentially leading to price pressure or a fragmentation of standards within the industry.
Regulatory Impact
Increased reliance on MIDD may influence regulatory review processes, and the extent to which agencies will accept model-driven data will shape the future of drug development.

Simulations Plus Sees Software Growth Offset by Margin Pressure

Event summary

  • Simulations Plus reported Q2 FY26 revenue of $24.3 million, an 8% increase year-over-year.
  • Software revenue grew 9% to $14.6 million, representing 60% of total revenue, while services revenue increased 8% to $9.7 million.
  • The company is revising its FY26 adjusted diluted EPS guidance range from $1.03 - $1.10 to $0.75 - $0.85 due to a higher effective tax rate.
  • Backlog increased approximately 18% during the quarter, driven by strong bookings.

The big picture

Simulations Plus operates in a niche market providing software and services to accelerate drug development, a sector increasingly reliant on AI and advanced modeling. While the 8% revenue growth demonstrates continued demand for their solutions, the revised guidance and margin compression suggest increased competitive pressure and potential macroeconomic headwinds impacting biopharma R&D spending. The company's ability to maintain its position as a leader will depend on its ability to innovate, manage costs, and adapt to evolving client needs.

What we're watching

Margin Dynamics
The significant drop in gross margin from 59% to 66% in Q2, followed by a 63% margin in the six-month period, warrants investigation into cost pressures and pricing strategies, particularly as the company navigates increased tax rates. Further margin contraction could signal competitive headwinds or execution challenges.
Software Mix
The decline in clinical operations software revenue, partially offset by growth in discovery and development solutions, suggests a potential shift in biopharma spending priorities. Whether Simulations Plus can maintain software revenue growth by expanding into new areas or upselling existing clients will be crucial.
Guidance Accuracy
The substantial downward revision of the full-year EPS guidance highlights the challenges in forecasting profitability, particularly given the variability of certain expense items. The company's ability to achieve the revised guidance will be a key indicator of its operational control and market resilience.

Simulations Plus Schedules Q2 FY26 Earnings Release

Event summary

  • Simulations Plus will report its second quarter fiscal year 2026 financial results on April 9, 2026, after market close.
  • A conference call to discuss the results is scheduled for April 9, 2026, at 5:00 p.m. Eastern Time.
  • Investors and shareholders can access the live webcast or dial-in to the conference call.
  • Simulations Plus is a provider of model-informed and AI-accelerated drug development solutions.

The big picture

Simulations Plus operates in a rapidly expanding market driven by the increasing complexity of drug development and the desire to accelerate timelines. The company's reliance on model-informed and AI-accelerated approaches positions it to capitalize on this trend, but also exposes it to risks associated with evolving regulatory landscapes and intensifying competition. The upcoming earnings release will be a key indicator of the company's ability to maintain its leadership position and deliver on its growth potential.

What we're watching

Growth Trajectory
The company's revenue growth will be heavily influenced by the adoption rate of its AI-accelerated solutions within the biopharma sector, and the Q2 results will provide insight into this trend.
Competitive Landscape
Increased competition in the model-informed drug development space could pressure Simulations Plus' pricing and market share, and the earnings call should reveal how the company is differentiating itself.
Regulatory Impact
Changes in FDA regulations regarding the use of AI and modeling in drug development could significantly impact Simulations Plus' business, and the company's commentary on this front will be crucial.

Simulations Plus Secures AI Collaboration Deals with Big Pharma

Event summary

  • Simulations Plus has entered into strategic collaboration programs with three large, unnamed pharmaceutical companies.
  • The collaborations focus on integrating AI into existing model-informed drug development (MIDD) workflows.
  • The programs will leverage Simulations Plus’ software platforms including GastroPlus®, MonolixSuite™, ADMET Predictor®, and Thales™.
  • Simulations Plus aims to standardize AI deployment, governance, and integration within client IT systems.

The big picture

Simulations Plus is positioning itself as a key enabler of AI adoption within the biopharmaceutical industry, moving beyond experimental AI applications to practical implementation. This strategy aligns with the broader trend of leveraging AI to improve R&D productivity and reduce drug development timelines, but also introduces challenges related to data governance and regulatory acceptance. The partnerships signal a shift towards enterprise-wide AI integration, requiring Simulations Plus to navigate complex IT landscapes and establish industry-wide standards.

What we're watching

Governance Dynamics
The success of these collaborations hinges on Simulations Plus’ ability to establish and maintain robust governance standards for AI usage within its clients’ organizations, which could impact future adoption rates.
Execution Risk
The integration of AI agents into existing workflows is complex; the pace of adoption will depend on Simulations Plus’ ability to deliver practical, deployable solutions and overcome potential technical hurdles.
Competitive Landscape
The collaborations will likely accelerate competition in the AI-driven drug development software space, potentially forcing Simulations Plus to adjust its pricing and product strategy to maintain market share.

Simulations Plus Convening Panel to Define AI's Practical Regulatory Path in Drug Development

Event summary

  • Simulations Plus is hosting a panel discussion, 'From Debate to Deployment: Responsible, Practical AI in MIDD,' at the ASCPT Annual Meeting on March 5, 2026.
  • The panel will focus on the practical implementation of AI in model-informed drug development (MIDD) workflows.
  • Key panelists include representatives from the FDA, Genmab, Incyte, Pfizer, Bristol Myers Squibb, and Simulations Plus.
  • The discussion aims to move beyond theoretical AI potential and address operational insights for scientists and stakeholders.

The big picture

The press release highlights a pivotal shift in the biopharmaceutical industry, moving beyond the hype surrounding AI to focus on practical, regulated implementation. Simulations Plus's initiative underscores the growing recognition that AI's value lies in its ability to augment, not replace, human expertise within complex drug development processes. This effort positions Simulations Plus to benefit from the increasing demand for validated AI solutions within a sector facing mounting pressure to accelerate timelines and reduce costs.

What we're watching

Regulatory Scrutiny
The FDA’s involvement signals increasing regulatory focus on AI in drug development, potentially leading to stricter guidelines and validation requirements for AI-driven processes.
Workflow Integration
The success of Simulations Plus’s strategy hinges on the ability of MIDD workflows to genuinely integrate AI, rather than simply layering it on existing processes, which will impact adoption rates.
Talent Shift
The panel’s discussion of evolving scientific roles suggests a need for upskilling and reskilling within biopharma, which could create a bottleneck if not addressed proactively.

Simulations Plus Secures FDA, NIEHS Collaboration Extensions for AI-Driven Safety Modeling

Event summary

  • Simulations Plus has extended two research collaborations with the FDA and NIEHS.
  • The extensions involve computational models for chemical safety assessments and environmental health research.
  • New federal funding will provide expanded datasets for training and validating Simulations Plus’ AI/ML models.
  • The collaborations support the FDA’s and NIEHS’s initiatives to modernize safety assessment using AI and in silico methods.
  • Simulations Plus has been involved in model-informed drug development for 30 years.

The big picture

The extensions underscore a broader trend of regulatory agencies embracing AI and in silico methods to modernize safety assessments, reducing reliance on traditional animal testing. Simulations Plus, with its three-decade history in model-informed drug development, is positioned to benefit from this shift, but faces increasing competition in the AI-driven software market. These collaborations represent a significant, albeit non-monetized, validation of Simulations Plus’ technology and expertise.

What we're watching

Regulatory Adoption
The FDA’s continued reliance on Simulations Plus’ models will be a key indicator of the broader acceptance of AI-driven safety assessments within regulatory frameworks, potentially impacting the company’s future contract pipeline.
Data Dependency
The success of the expanded collaborations hinges on Simulations Plus’ ability to effectively leverage the newly available curated toxicological datasets, which could expose limitations in data processing or model training capabilities.
Competitive Landscape
How Simulations Plus differentiates its AI/ML models from emerging competitors in the computational toxicology space will determine its ability to maintain its leadership position and secure future collaborations.

Simulations Plus to Present at Key Healthcare Investment Forums

Event summary

  • Simulations Plus CEO Shawn O’Connor will participate in three investor conferences in February and March 2026.
  • The conferences include the BTIG MedTech Conference (February 10, Utah), the TD Cowen Healthcare Conference (March 3, Boston), and the KeyBanc Healthcare Forum (March 18, virtual).
  • The BTIG and TD Cowen conferences will feature both one-on-one meetings and fireside chats.
  • Webcast links for the events will be posted on Simulations Plus’ investor relations website.

The big picture

Simulations Plus’ participation in these conferences underscores the company’s ongoing efforts to engage with the investment community and highlight its position as a leader in model-informed drug development. The conferences provide a platform to articulate the value proposition of AI-accelerated drug development, a sector attracting significant investment as biopharma companies seek to improve efficiency and reduce development timelines. These events also offer insight into management’s expectations for future growth and potential strategic initiatives.

What we're watching

Growth Trajectory
How the company frames its AI-acceleration strategy during these presentations will indicate the pace of adoption and potential revenue impact within the biopharma sector.
Competitive Landscape
The content of the fireside chats may reveal how Simulations Plus differentiates itself from competitors in the model-informed drug development space, particularly given the increasing number of entrants.
Advisor Influence
The involvement of BTIG, TD Cowen, and KeyBanc suggests a concerted effort to manage investor perception; tracking their post-conference commentary will be crucial.

Simulations Plus Bets on AI-Driven Modeling Ecosystem to Navigate Regulatory Shift

Event summary

  • Simulations Plus hosted a virtual Investor Day on January 21, 2026, outlining its strategic direction.
  • The company is focusing on an integrated, AI-enabled platform for drug development.
  • Shawn O’Connor, CEO, highlighted the need to address increasing scientific complexity and evolving regulatory expectations.
  • Co-Chief Product & Technology Officers Jonathan Chauvin and Erik Guffrey emphasized the shift from individual tools to a unified modeling ecosystem.

The big picture

Simulations Plus is positioning itself to capitalize on the growing trend of model-informed drug development (MIDD) and the increasing regulatory pressure for non-animal methodologies (NAMs). The company's shift towards a unified, AI-enabled platform represents a significant strategic pivot, aiming to move beyond a collection of best-in-class tools and offer a more comprehensive solution for biopharma companies facing escalating R&D costs and regulatory scrutiny. This strategy is predicated on the assumption that integrated platforms will become increasingly valuable as regulatory bodies demand greater transparency and reproducibility in drug development processes.

What we're watching

Regulatory Adoption
The FDA and EMA’s guidance on AI in drug development will significantly influence Simulations Plus’ platform adoption and validation timeline, potentially impacting revenue recognition and market acceptance.
Integration Risk
Successfully integrating Simulations Plus’ existing tools into a unified ecosystem will be critical; failure to achieve seamless interoperability could hinder productivity gains and client adoption.
Competitive Response
Other modeling and simulation vendors will likely respond to Simulations Plus’ AI-driven strategy, potentially intensifying competition and requiring ongoing innovation to maintain market share.

Simulations Plus Revenue Declines as Services Segment Drives Growth

Event summary

  • Simulations Plus reported Q1 FY26 revenue of $18.4 million, a 3% decrease year-over-year.
  • Software revenue fell 17% to $8.9 million, while services revenue increased 16% to $9.5 million.
  • Adjusted EBITDA decreased to $3.5 million, representing 19% of total revenue, compared to $4.5 million (24%) in the prior year.
  • The company reaffirmed its FY26 revenue guidance of $79-$82 million and adjusted EBITDA margin of 26-30%.

The big picture

Simulations Plus's mixed Q1 results highlight the challenges facing specialized software providers in the biopharma sector. While the services segment demonstrates resilience and growth potential, the decline in software revenue underscores the need for strategic adaptation and diversification. The company's success hinges on its ability to leverage AI and expand its service offerings to maintain market share and profitability amidst evolving industry dynamics and pricing pressures.

What we're watching

Software Dependence
The significant decline in software revenue raises questions about Simulations Plus's ability to maintain a balanced revenue mix and whether the company can effectively transition clients to its services offerings to offset this trend. Continued software declines could pressure margins and overall growth prospects.
Pricing Pressure
While 'most-favored nation pricing agreements' are cited as a positive, they also suggest potential pricing pressure within the industry. The sustainability of current margins will depend on Simulations Plus's ability to maintain value proposition and offset these pressures through operational efficiencies or service expansion.
AI Integration
The company's emphasis on AI-accelerated drug development requires careful monitoring. The pace at which Simulations Plus can successfully integrate AI into its offerings and achieve market adoption will be crucial for long-term growth and competitive differentiation.
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