Technology Advancements Driving Opportunities in Health Care

Technology in health care has historically driven a broad range of innovation, from the doctor’s office to the operating room, to the pharmacy. The role of technology in health care is often underappreciated. Many investors think of the large information technology giants when they consider the role technology plays in their lives, but technology’s reach is broader and is shaping the future of every industry. We believe numerous technology applications will shape the health care industry and impact people’s health care experiences.

These broad technology applications can provide a range of growth opportunities while, at the same time, offering relatively more resilient performance. Technological innovation combined with secular forces such as demographics-driven demand can enable stable earnings growth through a range of economic environments. Despite their role in improving the quality and duration of life, these technologies often don’t enjoy the spotlight or generate the excitement of more consumer-facing applications. These “under the radar technology” companies can provide opportunities for investing in life-changing innovation as well as stable growth and better downside protection, often at more attractive valuations than some widely discussed innovation leaders.

One example of how innovation is overlooked can be seen in something as simple as a syringe, where the development of safety technology to protect health care workers against exposure to blood-borne pathogens and drugs through accidental needle pricks has provided significant benefits. This technology has proven so successful that safety syringes have become the standard of care across multiple countries, and such regulatory mandates enable resilient revenue streams. Packaging is a similarly unappreciated application of technology in the health care field. While new biopharmaceutical molecules often garner all the attention, drug packaging requires innovative materials technology. High-value molecules increasingly require specialized packaging to prevent contamination and minimize wastage.