Health is a priority, even for the portfolio

During World Health Day, the spotlight is on the world of healthcare and more specifically on technological innovation as a centuries-old trend that cannot be ignored

“Let’s build a fairer, healthier world for everyone”. This is the theme chosen for the 2021 World Health Day edition. An event to commemorate the foundation of the World Health Organization (WHO), in April 7, 1948.The goal was to promote global awareness of crucial public health issues that concern the international community. This year, one year after the WHO declared the Coronavirus a pandemic, appointment for the health appraisal is more highly expected. 

The pandemic came suddenly, heavily impacting vulnerable countries, and not only. From being a healthcare matter, the Coronavirus soon became an economic emergency as well. The measures that governments around the world have been forced to adopt to contain the spread of Covid-19 have pushed many companies to definitive closures, and at the same time have increased the number of families in absolute poverty.

But this economic-health crisis has also brought out the strength of innovation and a capacity for reaction unimaginable so far. Starting with the new mRNA vaccines that were placed on the market by Pfizer and Moderna in less than a year. An innovative formula that does not introduce the actual virus into the cells of the patients, but only the genetic information (mRNA, in fact) needed by the cell to produce the fundamental antibodies to fight the virus.

This example of vaccine allows us to better understand the strength of the healthcare sector, which, thanks to the technological development, is aiming to grow exponentially. This, also due to the demographic changes that are affecting the whole world, destined to become a "country" for long-living people   . According to statistics of the Higher Institute of Health, by 2050 the percentage of elderly people will tend to double, going from 11% to 22%, while in the next 5 years, for the first time in history, the number of people over 65 will exceed the number of children below5. Furthermore, the percentage of over 80-year-olds in the EU-27 will be 2.5 times higher in 2100 than in 2019, going from 5.8% to 14.6% (Eurostat estimates).

In this context, the number of people in need of a long-term care is set to increase and, according to the Brussels estimates published in the Green Paper on demographic aging, reaching 23.6 million by 2030 and 30.5 million by 2050 in the EU-27. "The reliance on informal careers is no longer sustainable, as it is increasingly difficult to guarantee the help of family members - reads the Brussels Green Paper - Families have fewer children, members live distant from each other and women participate more in the labor market. States face common challenges in long-term care, including ensuring access, affordability, and quality and finally an adequate workforce.”

The greater attention by states to long-term care is a driving force for the healthcare world, which continues to represent one of the main items of government spending (about 10% of GDP). On the other hand, an aging population needs more and more medical care and consequently greater investments which are indispensable in the research and development of innovative and cutting-edge solutions. One of the sectors that stands out more than others for investments in research & development is Biotech, with an average expenditure of around 17% of turnover; a percentage that even rises to 60% in smaller companies. Furthermore, Biotech is always a very fertile ground for technological innovation, which will radically change the concept of medical assistance. All of this gives us an idea of the investment opportunities which can be offered in a long-term horizon by the healthcare world, and in particular the Biotech sector. A secular trend that adds value to the portfolio and that cannot, in fact must not, be ignored.