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Investing in health technology is an investment in the future

As the Covid-19 vaccines are rolled out and we gain control of the pandemic, discussions about the long-term effects of the pandemic have begun. It will be particularly interesting to see what effect it will have on health technology in the years to come.

When operations can return to normal, the pandemic will have led to very interesting changes for all of us. Trends show that more people will demand digital services now that they have had a taste of them due to the pandemic.

This is confirmed by several teams: One survey conducted by US McKinsey shows that 76% would consider using digital medical hours. It is also reflected in actual figures for use.

We can also expect that there will be many innovative solutions in health technology, and that many of today's solutions will be improved. An example of this is Google, which with project Starline has developed a completely new technology which means that via a screen you can meet your doctor or other healthcare professional as if they are in the same room as you (with a glass plate in between). Quite similar to the physical world with infection control-adapted Plexiglas. Starline is completely different from existing AR / VR technology and gives a feeling of volume and depth that can be experienced without the need for glasses or headsets.

Alternative investment areas in the future

In the next few years, we will see health technology stand out as an important investment area. Investors who have traditionally chosen to invest in oil, real estate and tourism should now look at opportunities in health technology.

In Norway, we have seen little of business policy in the area of ​​health technology. The public health service has dominated and development has been slow, many believe. Therefore, it has also been difficult to make money on health technology, but this is about to change.

Major Norwegian players such as Marble (the top company in the Hagen empire), The Sundt family og The Rasmussen family has already invested large sums in the health sector. In addition comes Investor, and other investment bankers such as Carnegie.

Norway can become a leader in this area

If there are enough investors who invest, we can make Norway a leading nation in health technology. Norway is well equipped for that: We have come a long way the development of fiber and 5G networks. In addition, there are many good, people-friendly solutions that safeguard privacy and security that will also work on a global scale.

May 2020 won the Norwegian company RESPINOR The European Innovation Council's pitch competition for corona solutions. Their solution measures movements in the diaphragm and can be used to determine when the patient should be taken off a respirator.

Trude Tingvoll, CEO of RESPINOR stated after the victory that - Winning means that buyers from a number of EU countries consider our technology as the best innovation aimed at the corona pandemic. This provides valuable market validation.

For other companies, this is a great inspiration, and for investors a sign that Norwegian solutions are of international caliber.

Health technology could be the new oil.

There are constantly innovations in the field, and new, exciting areas are emerging. Particularly exciting is the field of genetics and personalized medicine.

In the long run, innovation will be able to help the health service, which has a broken back under the pressure from lifestyle diseases and an impending wave of the elderly. With ever-increasing consumer-oriented services and conscious residents, this area offers great opportunities for innovation and value creation.

Why health technology is a good investment

Although historical returns are not a measure of future returns, it is clear that investments in the health sector have historically yielded good returns.

A clear reason for this is that there will always be a need for the health sector. The needs and services will change over time, but it shows that there is an enormous potential in innovative solutions.

Key factors that make health technology profitable

Increased prosperity means that a larger part of the world's population has access to and the opportunity to pay for health services. At the same time, the increased standard of living has led to several lifestyle diseases.

That we also live longer means that we live longer with various diseases. In the next few years, Norway will also be hit by a wave of the elderly.

All this, as well as large distances on the outskirts of Norway and a lack of health personnel will present major challenges.

These factors put a lot of pressure on the health sector.

At the same time, this can be a trigger for innovation. There will always be a need for new products, treatments and more effective health services. Health technology can contribute in all these areas.

Benedicte Kilander Bakke, fund manager at DNB, claims on their website that «There is little reason to expect anything other than growth in the health sector also in the future».

All over the world, people are living longer, and many have had the finances to pay for better health. It creates opportunities for those who invest in shares. DNB shows that the health sector over time provides a far better return than the broad market. This is an industry that generally has high earnings growth and a good return on invested capital, she says in the interview. - History both 30 and 50 years back in time shows the same, investing in health stocks generally gives a good return ..

That is just as true today. Innovation is one of the strongest drivers for growth in the health sector.

ALSO READ: Health technology is being helped by the pandemic

Another crucial factor for investment is this: Investments in the health sector and in health technology are safe investments. Everyone needs health care during their lifetime, and this market is not affected by the same market fluctuations as other sectors. Even during a pandemic, people are forced, and willing, to spend money on their own health.

The health sector will experience revolutionary changes

The health sector, and the health industry, will experience a number of revolutionary changes in the coming years. This will essentially be a digital revolution. In order to meet the demands of increasing efficiency and reducing costs at the same time as patient care is taken care of and medical research is carried out, health technology must be used to a much greater extent than today.

By using health technology, the amount of data will also increase. The key is to take advantage of this data to gain the insights needed to further develop health technology.

Data can be used in all parts of the value chain: From clinical studies and research, to diagnosis and prevention. Aids that use artificial intelligence can help with symptom analysis and monitoring of various values.  

Using technology, large amounts of data can be categorized and analyzed at a dizzying pace. This will increase our understanding of how disease spreads in the human body and in society.

The opportunities in health technology are enormous.

These are the four most interesting investment areas in health technology

Health technology can be divided into several main areas, and these are the four areas that are most interesting for investors:

Technology for data collection / portable devices: Access to behavioral data and clinical data will improve treatment and how we deal with medical problems. We will have access to faster and more accurate sensors that are more widely available. "Wearables" are already used by people around the world to measure activity, sleep patterns, calorie consumption and more. Units that also measure different medical values ​​will have an enormous impact on patient care.

Data streaming and computing technology: This is technology that allows us to shift, process and perform calculations based on data faster, and in larger volumes than ever before. This provides opportunities to analyze possible disease courses and the spread of diseases in a completely new way.

Artificial intelligence: Artificial intelligence will help us understand and analyze the vast amounts of data that are collected. Pandemic accelerates the use of artificial intelligence (AI) in the healthcare sector. Artificial intelligence is used today to quickly analyze symptoms and measure values ​​in patients.

Technology in practice: Technology that allows us to make use of information that is made available using AI. Will transform both complex and routine tasks in all parts of the health sector's value chain.

Da Investinor invested in the company Dignio The incoming board member, Daniel Holth Larsen, also emphasized that the industry itself is demanding new solutions:

- Increasingly younger people work in the health care system and these have grown up with digital solutions that make everyday life easier, and therefore want similar good digital solutions at work to provide the maximum. The aging wave is not getting any smaller, and elderly people at home want security, coping skills and an active dialogue with the health service.

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Investments in Norway and the Nordic countries

Major Norwegian players have come on the scene and invested heavily in the health industry and in health technology. And many invest in Norwegian companies.

Norwegian and Nordic companies engaged in health technology have over the past year raised huge investment sums in several issues:

  • Share Health Tech Retrieved in December 2020 NOK 65 million.
  • In August 2020, Eyr raised 50 million in fresh capital.
  • In April this year, Shifter was able to report that "Swedish online doctors collect NOK 2,65 billion". Swedish Kry raised SEK 2,65 billion, and the company was priced at almost NOK 17 billion in this financing round.
  • Prior to Pasientsky being listed on Merkur Market in October 2020, the company was valued at NOK 1,15 billion. Then they also wanted to carry out a share issue of 500 million before the company was to be listed on the stock exchange. Before the issue, it was pre-subscribed for 250 million.  
  • In December 2020, the company Dignio was able to state in a press release that investors had entered the company with 85 million. The company was according to DN priced at 250 million.

If Norwegian investors follow the same trend in the years to come, Norway will be able to excel as a leader in the market for health technology.

Investments globally

Internationally, we already see that a lot of money is being invested in health technology: CBInsights has prepared a report showing useful insights into international investment.

ALSO READ: Do you want to invest in tomorrow's health service - delivered today?

The first quarter of 2021 has generally been a very good quarter in terms of investments in the health sector. In Q1'21, a record quarter total of $ 31,6 billion was invested as equity in various global healthcare services.

CBInsights also reports that the health technology companies Oscar Health and Alignment Healthcare were listed in Q1'21, while several other companies have announced that they are planning a listing.

If we look specifically at health technology, the report shows that global funding in health technology made a jump of 9% in the first quarter of 2021, compared with the fourth quarter of 2020. 

In Q1 2021, more than $ 9 billion in share capital was raised. The number of agreements increased by almost 13%.

Health technology - today's best investment?

As mentioned, the health sector is facing a digital revolution. In light of the pandemic, health technology has become more relevant than ever before. As the need, and desire, for more and better digital solutions in the health care system increases, we will see a rapid development.

Companies that focus on the patient experience and that quickly come up with innovative solutions have begun to close the gap between existing and future needs. They are the ones who will take the health sector into the future.

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