Text size

Healthcare – compelling growth potential in a non-cyclical industry

Listen to article

Bellevue AM

This is a sponsored article from Bellevue AM.

Healthcare is one of the most dynamic and promising sectors, both at present and in the future. This is why investors should take a closer look at this high-growth industry.

Healthcare is back in investors’ focus, and for good reasons: non-cyclical by nature, the sector demonstrated greater crisis resilience during the corona pandemic and geopolitical discord than other industries and delivered consistent sales growth between 4% (pharma) and 10% (biotech). Ageing societies and more chronic diseases are driving innovation across sub-sectors and leading to medical breakthroughs and revolutionary treatment approaches, making global healthcare systems more efficient and affordable. These structural tailwinds enable the healthcare sector to grow at 5% annually, which is twice as fast as the global economy. Coupled with its general defensiveness and lower volatility than other sectors, healthcare provides compelling opportunities for investors seeking growth. Now in particular is a good time for investors to engage, as valuations are attractive compared to the overall market.

Much more than big pharma

While generally associated with traditional pharmaceutical companies from Europe and the US, healthcare is much broader than this and so are the investment opportunities within the sector: medtech companies advance robotic and sensor-based technologies and drive the digitalisation trend, biotechs develop innovative new drugs and therapies, generics producers make treatments more affordable. Investors can either adopt a comprehensive healthcare investment approach or focus on sub-sectors with individual economic drivers and risk-return characteristics.

Asia and China increasingly in focus

China’s drug market is the world’s second largest after the US, but contrary to the US and Europe, healthcare still only accounts for a fraction of the Chinese economy. This will change as demand for healthcare products and services is rapidly increasing in tandem with a growing middle class that demands better access to drugs and treatments. As such, the status quo in China is comparable with the US in the late 1980s, at the onset of the biotech boom. Put differently: China’s healthcare market is poised for substantial growth. Another market that investors should focus on is Japan: established Japanese healthcare companies are global leaders in antibody platforms, Alzheimer’s research, imaging technology and other areas. India, on the other hand, is famous for efficiently and reliably producing generics and currently provides about 50% of the US demand.

How to invest in Asia’s healthcare markets?

We offer a portfolio that captures growth opportunities across healthcare sub-sectors in the Asia-Pacific region, including pharmaceuticals, generics, medical devices, biotechnology, services (e.g. hospitals), and diagnostics. As such, the Bellevue Asia-Pacific Healthcare fund (ISIN: LU1587984680) employs a barbell approach and invests in an attractive mix of fast-growing companies in emerging Asia (e.g. Chinese biotech) and high-tech in developed Asia (e.g. Japanese pharma). This approach allows our portfolio managers to diversify and exploit opportunities across markets, regulatory frameworks and therapeutic areas. The strategy, which usually comprises 40-50 stocks, is built on fundamental research and constructed entirely bottom-up. It was launched in 2006 and has been run by the same team since, returning 144.6% since inception and significantly outperforming MSCI APAC (87.1%) and MSCI APAC Healthcare (110.8%). (Performances in USD as of April 2022.)

Learn more about the Bellevue Asia Pacific Healthcare fund.

Excellence in healthcare investments

Bellevue Asset Management is one of the largest European healthcare investors with US$14 billion AUM* fully committed to offer its clients unique sector expertise and attractive investment opportunities. Since 1993 we have been investing globally in the most innovative, high-quality companies that develop new drugs, superior medical equipment, and key healthcare technologies. Our global portfolio management team consists of over 20 investment professionals with profound life-science backgrounds across a variety of relevant disciplines in neuroscience, oncology, biotechnology, and data science. Headquartered in Zurich, we have investment teams in New York, London, and Frankfurt – and are currently looking into building up a presence in Hong Kong and Singapore. Our offering consists of a diversified range of investment funds covering medical technology, digital health, biotechnology as well as Asia-focused and emerging markets healthcare themes.

Bellevue Asset Management is committed to sustainable, responsible and value-based corporate practices. We are a signatory of the UN Principles for Responsible Investment (UN PRI) and integrate ESG considerations at every stage of the investment process. All our funds are classified as Article 8 according to the SFDR framework.
*as of Dec 2021

Bellevue: Dedicated solutions for global, regional and sectoral healthcare strategies

Learn more: www.bellevue.ch
Florin Boetschi
Florin Boetschi, Sales & Distribution Asia
Email: [email protected]

Bellevue AM

This is a sponsored article from Bellevue AM.

Related Tags