Demolition work has started to make way for the national centre at the new South Glasgow Hospitals Campus.
The project will create hundreds of jobs and boost the city's reputation as a centre for medical research.
Scientists will examine the genetic make-up of patients and their responses to drugs designed to treat specific diseases.
In doing so they hope to create personalised and effective forms of treatment for cancer, stroke, diabetes, rheumatoid arthritis and respiratory and cardiovascular diseases.
Experts say there is a clear economic argument for the development of, "stratified medicine," as well as the medical benefits.
The University of Glasgow has been given funding to create the Stratified Medicine Scotland Innovation Centre (SMS-IC).
Professor Anna Dominiczak, Vice-Principal and Regius Professor of Medicine at the University of Glasgow, said: "We are excited that construction of the Stratified Medicine Scotland Innovation Centre is getting underway and look forward to acquiring this superb new facility which will help us develop new treatments for a range of chronic diseases."
The Scottish Funding Council is providing £8m over five years to back the creation of the centre, which is scheduled to open in September 2015.
Housed in the hospital's teaching and learning facility, between the neurological building and the old acute hospital, the centre will help strengthen commercial partnerships between local life-sciences companies, universities and the NHS.
The Scottish Funding Council is providing £8m over five years to back its creation. The new unit could boost the city's economy by up to £68m in five years, with about 20% going to local small and medium-sized companies, according to independent forecasts.
When the £840m South Glasgow Hospital opens in 2015, it will be one of the largest in Europe.