Investment opportunities in healthcare for 2021 and beyond

Covid-19 had a profound impact on healthcare investment opportunities and strategies

Investing early comes with several potential challenges and requires companies to meet certain criteria, including: the quality of their basic research, the skills of their management team, the financial capability of the company, future relevance, the benefit to patients, and the possibility of future commercialisation

BySCMP Events

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[Left to Right] Clark Cahill, Manager of Events and Conferences at SCMP, Andrew Wong, Vice President of Early Innovation Partnering at Johnson & Johnson Innovation Asia-Pacific, Simone Song, Founder & Senior Partner of ORI Capital, and Andy Wong, Head of Innovation and Technology at InvestHK to introduce the current healthcare investment landscape in the Asia Pacific region.

Published: 5:34pm, 4 Nov 2021Updated: 3:41pm, 6 Jan 2022

Covid-19 had a profound impact on healthcare investment opportunities and strategies. SCMP Conversations: Healthcare introduced the current healthcare investment landscape in the Asia Pacific region, starting off with Regional Vice President of Early Innovation Partnering at Johnson & Johnson Innovation Asia-Pacific, Andrew Wong noted how “the pandemic highlighted the importance of collaboration.”

Collaboration between different healthcare sectors was necessary to produce an effective solution to the pandemic as quickly as possible. On the same subject, Simone Song, Founder & Senior Partner of ORI Capital, stated “a lot of things are sped up … the translation from the lab to the real world is at a speed we have not seen.”

Simone Song, Founder & Senior Partner of ORI Capital stated “a lot of things are sped up … the translation from the lab to the real world is at a speed we have not seen.”

This new focus on collaboration and acceleration in drug development had several effects on the investment landscape. Andy Wong, Head of Innovation and Technology at InvestHK, shared “in 2020, the total funding awarded to different projects [from the Innovation and Technology Fund] was about 3 billion... [and] out of the 3 billion, about 300 million belongs to the biomedical [sector].”

Andy Wong, Head of Innovation and Technology at InvestHK, shared “in 2020, the total funding awarded to different projects [from the Innovation and Technology Fund] was about 3 billion... [and] out of the 3 billion, about 300 million belongs to the biomedical [sector].”

This is relevant because the Innovation and Technology Fund has awarded a cumulative amount of about 25 billion to different projects since its founding in the 1990s, and prior to 2020, only about 6 per cent of capital had gone to the biomedical sector. The increased focus on the biomedical sector in 2020 suggests a shift in the future of healthcare research, development, and investment.

When investing in the healthcare industry, Song stated “the strategy is to go early.” Investing early comes with several potential challenges and requires companies to meet certain criteria. Some factors may determine which healthcare projects, companies, and start-ups are worth investing in, including: the quality of their basic research, the skills of their management team, the financial capability of the company, future relevance, the benefit to patients, and the possibility of future commercialisation.

The largest factor when choosing investments is the degree to which the new product or technology is transformational or disruptive. In other words, investors need to focus on innovations that can change the standard of care and elevate the entire framework of the healthcare industry.

Andrew Wong, Vice President of Early Innovation Partnering at Johnson & Johnson Innovation Asia-Pacific noted how “the pandemic highlighted the importance of collaboration.”

According to Andrew Wong, some “key therapeutic areas” which will likely retain a lot of investor attention in the future include pharmacology, oncology, immunology, infectious diseases, cardiovascular health, and pulmonary tension. Other healthcare sectors that will likely provide opportunities for investors include skin health, orthopedic medical devices, and digital health/telehealth.

In the firechat with Vikram Kapur, Partner & Head of APAC Healthcare Practice at Bain & Company, moderated by Peggy Sito, Deputy Business Editor at the Post, Kapur shared the biopharmaceutical sector attracts the most attention from private investors, and “the other big theme we saw in the past year was continued investment behind innovation, be it med tech... health tech [etc.].”

Vikram Kapur, Partner & Head of APAC Healthcare Practice at Bain & Company shared the biopharmaceutical sector attracts the most attention from private investors, and “the other big theme we saw in the past year was continued investment behind innovation, be it med tech... health tech [etc.].”

With such a large focus on health and healthcare innovation as a result of the pandemic, “healthcare has now become almost like the next national defense [for most governments],” noted Kapur. This suggests the healthcare sector will be full of large opportunities for investors for the foreseeable future in the Asia Pacific region and beyond.

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