COVID-19 is reshaping global healthcare. How should investors respond?

How has the pandemic impacted healthcare and biotech companies? The UK’s NHS has been stretched to its limit. COVID-19 has increased the waiting list for procedures from one million to four million, meaning that cancer screenings have been driven to a halt.

In a recent ‘Global Sector Series’ webinar held on 25 March 2021, Will Thompson, Head of Healthcare & Real Estate EMEA, Barclays Investment Bank, discussed how this had impacted healthcare. “There’s huge pent up demand for elective surgery and business to go back to usual,” he said.

“Through a UK lens the NHS waiting list has ballooned from one million to four million, causing significant concern around cancer screenings. We’re going to see provision and service areas (i.e. dental) bounce back quickly across the globe,” Thompson added.

Services and products have been disrupted. However, the development of new technologies such as artificial intelligence (AI) and robotics are transforming the healthcare sector’s pandemic response. For example, vaccine development previously took up to five years from bench to clinic, but using AI this now takes under a year.

Technology has revolutionised drug discovery – an industry that was previously one of the slowest to adopt digitalisation. There’s rapid growth across all verticals in the sector - in healthtech, diagnostics, pharmaceutical services, healthcare provision and services.  This has led to plenty of interest from investors, from early stage venture capital financing, private placement and sector consolidation. There’s also been a pipeline of large IPOs supported by resilient valuations on the private and public markets.

Both demand and pricing has spiked across all Indian healthcare verticals. Despite remote working, there is efficient deal-making. Professional services have been busier than ever to support the rapid development of key Indian pharmaceutical players. Drug formulation and manufacturing is being led by India's expertise and there’s new growth and innovation pockets emerging.

Jayesh Visaria, Head of Healthcare and Consumer, Barclays India, was also a webinar guest. He said: “From an India perspective, we’re starting to see the emergence of pockets of innovation occurring, particularly in AI and radiology. The new technology developed allows for CT scans and X-Rays to be read without any human intervention and provide better results than traditional methods used over the last 20 years.”

This article is taken from our Global Sector Series webinars, bringing you the latest insights and debates on issues facing individual industries today. Read our article to find out more about how technological developments have revolutionised vaccine development. To learn more about opportunities for growth in healthcare, watch a replay of our Global Sector Series webinar.

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