Investing in Global Goal 3: Good health and wellbeing

Written by Damien Lardoux on 13th Dec 2017

It’s Day 6 of the Good With Money alternative #SDGsAdvent, where one expert looks at how to invest for one Goal every day until Christmas. Today, Damien Lardoux, manager of the EQ Investors Positive Impact Portfolios, talks about investing to achieve the goal “Good Health and Wellbeing”

Ensuring healthy lives and promoting wellbeing for all at all ages is essential to sustainable development. Since the beginning of the century, significant progress has been made on increasing access to safe drinking water, adequate sanitation and developing new medicines.

However, further efforts are needed to fully eradicate a wide range of diseases and address emerging health issues.

An ageing population combined with changing lifestyles and the revolution brought by technology make healthcare one of the most attractive sectors.

Beyond its obvious positive impact on society, healthcare as a theme represents a high exposure within the EQ Positive Impact Portfolios due to the huge scale of opportunities and our strong conviction in its future return potential.

Indeed, an ageing population combined with changing lifestyles and the revolution brought by technology make healthcare one of the most attractive sectors. It’s not a surprise to see that global health care expenditure is projected to reach $8.7 trillion by 2020 representing a rise of 24 per cent since 2015.

The massive opportunity in healthcare is foremost down to demographics. The world’s population has grown exponentially to around 7.6 billion people. By 2050, it is projected to reach 9.8 billion and 11.2 billion by 2100. In particular, Africa’s share of global population is expected to increase from 16 per cent today to as much as 40 per cent by 2100. Fertility rates have declined and life expectancy has risen worldwide, resulting in the universal phenomenon of ‘population ageing’.

Economic development is also leading to large-scale changes in diet and lifestyle in many parts of the world – unfortunately not always for the better. A lack of exercise combined with increased calorie intake and higher level of stress is leading to the rise of diseases like Type II diabetes (the term ‘diabesity’ has been coined) to epidemic levels.

Novo Nordisk, a Danish company with a leading position in diabetes care, has seen its revenues increasing by nearly 200 per cent over the last 10 years. Having been one of the pioneers of insulin production, the company is now working on promising new molecules that could help to tackle a number of diseases related to obesity, in-turn boosting its revenues.

Finally, technology is revolutionising health care by improving drug treatments, access and convenience of care as well as reducing costs. Advances in genetic sequencing since the 1990s has helped the biotechnology industry to go from budding research into the inner workings of the most basic building blocks of our bodies, developing targeted therapies for some of the most challenging diseases.

In recent years, the development of 3D-printed devices has helped to create relatively low cost customised products that are tailored to the needs of individual patients. Stryker is one of the world’s leading suppliers of orthopaedic hip and knee products produced with the help of 3D printers. The company has increased its revenues by 120 per cent over the last 10 years.

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