Healthcare is one of the largest and fastest growing industries. In 2018, the global health industry was worth $8.45 trillion and is projected to top $10 trillion in 2022.1 Despite rising costs and supply chain issues, global healthcare spending is expected to advance at a compound annual growth rate of 1.4%.

Source: Shutterstock

Healthcare has never been more important to the global economy than over the past two years. And the global healthcare market will continue to be crucial to the growth of the economic recovery as the world continues to fight and manage COVID-19.

At the same time, the healthcare industry needs to start tackling the backlog of care that was, in large part, put on hold since the beginning of the outbreak. Interestingly, the healthcare industry will be using the same ground-breaking technology behind the Pfizer and Moderna vaccines, which used mRNA-delivered lipid nanoparticles, to develop better treatments and vaccines in 2022 and beyond.2

Researchers are exploring the use of mRNA vaccines for cancer and HIV treatments, and infectious diseases such as influenza, zika, and rabies. On top of that, lipid-based delivery systems are being studied for their potential to allow immunotherapy drugs or chemotherapy to target cancer cells more directly in an effort to enhance the overall effectiveness and/or reduce side effects. Other research is focused on gene therapies to treat neurological diseases.

Weighing In with Big Pharma

Source: Seekingalpha.com Photo: Novo NordiskA/S

Novo-Nordisk A/S

Novo-Nordisk AS said it expects sales from its recently approved weight management drug, Wegovy, to more than double it’s previously announced 2025 sales target.3 The Denmark-based healthcare company now expects Wegovy sales to top more than $3.72 billion.

Based on 2019 sales from its weight-loss product Saxenda of $849 million, the pharma company had target sales of $1.69 billion by the middle of the decade.4

But with the approval of Wegovy from the FDA in June 2021 and Health Canada in November 2021, the company’s outlook has become more bullish.5,6 In less than a year, the number of doctors prescribing Weygovy surpassed Saxenda. Demand for the drug was so great in 2021 that it outstripped supply in the U.S.

Source: Abbvie

AbbVie

AbbVie announced it is taking company-wide steps to increase its profitability in 2022. The company said it axed a fibrosis program it paid $20 million for in 2020 and was closing its pension fund for new U.S. hires.7,8

This comes on the heels of the company’s strong fourth quarter 2021 results in which total net sales increased 7.5% to $14.88 billion, with earnings per sharing climbing more than 100% to $2.26 per share, and adjusted earnings advancing 13.4% to $3.31 per share. AbbVie also gave strong guidance for 2022 with adjusted EPS in a range of $14.00 to $14.20 per share.9

Amidst healthy and growing profits, the pharma company is shoring up its bottom line ahead of the 2023 expiration for its flagship product Humira. Management expects sales to decline in 2023 but says it will return to positive growth in 2024.

Source: Pfizer Inc. headquarters

Pfizer Inc.

Pfizer Inc said it expects to report record sales in 2022, fueled in part by $23 billion in revenue from its COVID-19 shots and $22 billion from Paxlovid, its antiviral coronavirus treatment.10

The company forecasts total 2022 sales of $98 billion to $102 billion and adjusted earnings per share of $6.35 to $6.55.

 

Investing in Healthcare with LIFE ETF

One way to simplify investing in the cutting-edge healthcare industry is through an ETF. A healthcare ETF offers a diversified portfolio of holdings in healthcare stocks. ETFs ensure that your risk is diversified, but that you are still invested in blue-chip names that you trust.

Evolve Global Healthcare Enhanced Yield Fund (LIFE ETF) provides investors with exposure to twenty global blue-chip companies in the healthcare industry, with a covered call strategy that is actively managed to provide increased yield potential while helping mitigate risk. LIFE ETF is available in hedged, unhedged and USD classes, as well as mutual fund versions.

For more information about the Evolve Global Healthcare Enhanced Yield Fund or any of Evolve ETF’s lineup of exchange-traded funds, please visit our website or contact us.

 

Sources:

  1. “China’s Consumers Risk FOMO as Electric Cars’ Popularity Soars,” BNN Bloomberg,  January 10, 2022; https://www.bnnbloomberg.ca/china-s-consumers-risk-fomo-as-electric-cars-popularity-soars-1.1705345.
  2. Leonard, J. and King, I., “Biden Team Says Global Chip Shortage to Stretch Through 2022,” BNN Bloomberg, January 25, 2022; https://www.bnnbloomberg.ca/biden-team-says-global-chip-shortage-to-stretch-through-2022-1.1712963.
  3. “TI reports Q4 2021 and 2021 financial results and shareholder returns,” Texas Instruments Incorporated, January 25, 2022; https://investor.ti.com/news-releases/news-release-details/ti-reports-q4-2021-and-2021-financial-results-and-shareholder.
  4. Hawkins, A., “VW sets a date for the reveal of its production-ready electric Microbus,” The Verge, January 6, 2022; https://www.theverge.com/2022/1/6/22870273/vw-microbus-electric-id-buzz-date-reveal?cmpid=BBD012522_hyperdrive.
  5. Ludlow, E. “Rivian boosts production of pickups after last year’s woes, report says,” Automotive News, January 26, 2022; https://www.autonews.com/manufacturing/rivian-boosts-production-pickups-after-last-years-woes-report-says.

 

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