Healthcare technology – just what the doctor ordered
In the face of escalating costs and the pressures of rising and ageing populations, the healthcare sector is focused on innovation to sustain services and grow income, which in turn is delivering opportunities for investors.
"Innovation is resetting perceptions of value in healthcare," says Kevin Lyne-Smith, Managing Director, Global Head of Equities, at HSBC. "With the long-term cost of chronic illness mounting, investment in areas such as biotech or gene therapy, as well as enabling technologies, is beginning to make more sense."
As the appetite and market for these innovations increases, so too does the investment in innovation – creating a virtuous circle of health and social care improvement. Freeing up time and resources is crucial to a sector that, certainly in many advanced economies, is creaking. The twin pressures of an increasingly ageing population, often with multiple chronic illnesses, as well as the growing number of individuals living with, rather than dying from, conditions, is being felt by countries and health authorities around the world.
Improved patient experience
Simple wearable devices or home monitoring/sensing devices can keep patients at home for longer and arguably provide more robust and regular data feeds to monitor their conditions, diagnose symptoms of concern and provide timely intervention when necessary.
"Previously, patients with arrhythmia or heart conditions, for example, would spend weeks in hospital, having their symptoms measured at regular intervals," says Kevin. "Now, that can be done at home – where the patient is more relaxed, the risk of infection is removed and both a hospital bed and staff time is freed up."
The same could be said for the elderly, where in-home and wearable sensors could alert staff to changes in hydration levels, lack of movement or even a fall. "Many of these devices exist, but what will be a real game changer will be the rollout of 5G, which will allow their full potential to be realised," says Kevin. "Faster connectivity, greater bandwidth and stability of connection will enhance patient and user experience."
"Covid-19 has changed the way Big Pharma works forever. The need to move quickly has revolutionised the industry, making it more agile, more innovative and opening up new areas of collaboration." Kevin Lyne-Smith, Managing Director, Global Head of Equities, HSBC.
Supporting rapid innovation
Technology has also played a key role in the rapid response to Covid-19 and the pandemic has seen both wider innovation and the adoption of new technology increase dramatically. The evolution of rapid lateral flow tests available at home and the ability to mass test offers huge opportunities for post-pandemic portable diagnostic tools, for example. Meanwhile the role of technology in enabling the rapid sequencing of the virus, supporting analysis and mass data modelling, then managing large-scale clinical trials and tests, has seen the development of vaccines to tackle Covid-19 in what is an unprecedented and extraordinary timeframe.
"Covid-19 has changed the way Big Pharma works forever," says Kevin. "The need to move quickly has revolutionised the industry, making it more agile, more innovative and opening up new areas of collaboration. These new ways of working and changes to public perception of Big Pharma will create a number of opportunities post-Covid-19."
Wider acceptance of technological solutions within healthcare has also received a boost as a result of the pandemic. Remote monitoring and even online GP appointments are driving efficiency, while patient satisfaction and organisational buy-in look set to create a springboard for further investment and innovation.
Boosting future opportunities
"Technology has proved its worth in improving patient outcomes, through better diagnosis and earlier treatment," says Kevin. "It's also allowing for better and more efficient use of resources – you can monitor a lot more people remotely, you can create specialist hubs with expertise available remotely and you can automate procedures and potentially reduce waiting lists. But technology can also help address the costs of health and social care, which is a growing issue for many countries."
It's why, explains Kevin, the market for healthcare and, therefore, healthcare technology, is rapidly expanding. "As countries become richer, they spend more on healthcare and many of these countries are already advanced in terms of digitalisation, making healthcare technologies a natural step. Investors are watching countries like China and India for new, and potential innovative approaches and ideas ."
And the future for the use of technology in healthcare could be even brighter, says Kevin. "We're already seeing 3D printing being used to print cells to create replacement body parts with incredible precision. Augmented reality supports micro-surgery and reduces risk, and virtual reality is allowing the sharing of knowledge and broader collaboration. It can help in training and education, allow consultants to supervise beyond the confines of their teaching hospitals and permits a richer flow of information even during surgery, which can massively improve quality and outcomes."
Healthcare is a sector that is already benefiting from the growing availability of technology and the opportunities for the future are clear. Technology offers us all – whether as a patient, provider or investor – the potential for better outcomes.