Please upgrade your browser

We take your security very seriously. In order to protect you and our systems, we are making changes to all HSBC websites that means some of the oldest web browser versions will no longer be able to access these sites. Generally, the latest versions of a browser (like Edge, Chrome, Safari, etc.) and an operating system family (like Microsoft Windows, MacOS) have the most up-to-date security features.

If you are seeing this message, we have detected that you are using an older, unsupported browser.

See how to update your browser

Defining features of sustainable healthcare innovators

In an era of growing demand and constrained budgets, pharmaceutical innovation is not enough
01 December 2021
    In an era of growing demand and constrained budgets, pharmaceutical innovation is not enough

    In the search to treat more people at lower costs and with better outcomes, making healthcare sustainable is about looking for true value, as well as efficacy from novel molecules. This means that pharma’s innovation efforts need to be holistic, focusing on wider benefits beyond how well the treatment works – to better outcomes for the system as a whole.

    From an investment perspective, this approach does not mean inexpensive, however. “Affordability is often equated with cheap, but that’s not necessarily true,” says Dr Nathalie Flury, co-head at the Global Equity Sustainable Healthcare Fund, which aims to achieve results by focusing broadly on true innovation that helps healthcare providers and payers do more for less.

    Roche’s haemophilia drug, Hemlibra, is a good example. “It costs $500,000, which is not cheap, but is significantly more affordable than the standard therapy scheme, which costs $1.3 million,” says Flury1. The established, more expensive therapy also requires other drugs to be taken to prevent complications, whereas the Roche drug reduces bleeds by 98 per cent on its own, says Flury’s colleague Dr Michael Schröter, and her co-head at the Global Equity Sustainable Healthcare Fund. “The patient is better off, and can lead a more or less normal life.”

    Prevention is better than cure

    Prevention and early treatment also hold great promise in cutting costs while improving outcomes for patients. New colon cancer screening techniques that allow for less invasive and more regular testing are another good example of healthcare innovation that has multiple payoffs for all parties, including earlier treatment.

    Liquid biopsies for cancer patients that can detect cancer earlier, as well as track cancer progression more closely, enabling clinicians to adapt treatment paradigms accordingly, is another example of exciting new investment horizons, says Flury. “Surgeons don’t like to take traditional biopsies serially and, sometimes, this is not even possible. Everyone knows that, if you can prevent a disease developing or intervene early for a patient, it will be better, with higher survival rates – and it will be less costly for the system. These are the solutions we are searching for.”

    Other emerging diagnostic investment themes include new testing possibilities enabled by the cutting-edge sequencing of genetic material at scale and at low cost. The combination of diagnostic tools with therapies to streamline and simplify condition management is another investment theme with promise. A good example is “closed loop” diabetes treatments comprised of insulin pumps paired with continuous glucose monitoring systems that, to a great extent, automate the management of diabetes.

    These systems, which can cut a patient’s use of insulin and reduce their risk of developing diabetic complications, as well as enabling them to monitor and manage their condition better and lead fuller lives – are one example of such solutions, which offer a wide array of health, lifestyle and economic benefits and, as such, offer great potential as sustainable investment propositions.

    The future is telehealth

    Pharmaceuticals and diagnostics are not the only way to improve outcomes for patients, providers and payers. Therapies that reduce hospital stays are attractive, and telehealth is increasingly proving its considerable potential to help here. The savings can be huge. Emergency room visits, for example, can cost $10,000 per day in the US. “If you average two or three days, that’s $20,000–$30,000 saved,” says Dr Schröter.

    An emerging generation of digital monitoring solutions that enable patients to leave hospital earlier, to be monitored by care teams while recovering at home, is another promising investment proposition that has been boosted during the pandemic. It is a long-term theme, Flury believes. “I am fully persuaded that this is not going to go away when the pandemic is over,” she says. “Quite a few telemedicine companies have realised that, now their patients can be online with their physician, they will continue to use it for many things post-pandemic, such as 10-minute update. For many people, especially in the rural parts of the US, it is a huge effort to go to a doctor. This system is easier for everyone.”

    Find out more

    Important Information:
    This document is for general circulation and information only and is not an advertisement, investment recommendation, research, or advice. Any views and opinions expressed are subject to change without notice. It does not have regard to the specific investment objectives, financial situation, or needs of any specific person. You should seek advice from a financial adviser regarding the suitability of any investment product (taking into account the specific investment objectives, financial situation and/or particular needs of each person in receipt of the information) before making any investment. Investment involves risk. Past performance of the managers and the funds, and any forecasts on the economy, stock or bond market, or economic trends that are targeted by the funds, are not indicative of future performance. The value of the units of the funds and income accruing to them, if any, may fall or rise and investor may not get back the original sum invested. Changes in rates of currency exchange may affect significantly the value of the investment. HSBC Asset Management (Singapore) Limited ("AMSG") has based this document on information obtained from sources it reasonably believes to be reliable. However, AMSG does not warrant, guarantee or represent, expressly or by implication, the accuracy, validity or completeness of such information.

    HSBC Asset Management (Singapore) Limited
    10 Marina Boulevard, Marina Bay Financial Centre, Tower 2, #48-01, Singapore 018983
    Telephone: (65) 6658 2900 Facsimile: (65) 6225 4324
    Company Registration No. 198602036R