The pandemic pushed an unprecedented level of funding into the healthcare sector, turbocharging technological innovation, says Jenny Chang of Goldman Sachs Asset Management. Drugs are being developed faster and timelines are getting shorter. And the pace of that innovation is unlikely to slow. Advancements in medical devices and minimally-invasive procedures like robotics are accelerating, and advances in genomics and gene editing have created enormous opportunities to add to the short list of world diseases (0.2% of roughly 5,000 1) for which we have cures.
Digitization will remain a dominant trend. The sheer number of virtual doctor visits, or telemedicine, may decline from their pandemic peaks during lockdown but are almost certainly here to stay. Goldman Sachs’ Jim Sinclair in Investment Banking notes that both public and private investors have shown interest in opportunities connected to software and other tools to support virtualization. Companies invested around $13 billion to support innovative growth in healthcare and healthcare technology during the first quarter of 2021. In 2012, these sectors received about $1 billion of investment for the entire year.2 Private capital has ebbed and flowed a bit more, but Sinclair said he expects support for innovation from growth equity funds to remain fairly constant.
Other trends to watch include increased demand for mental health care and treating diabetes—two conditions that appear to have proliferated during the pandemic-induced lockdowns. Read more.
