Health Tech - Interesting investment theme of the future

The COVID-19 crisis starting in 2020 has accelerated changes to lifestyles and technology.  The pandemic has also forced people to take better care of themselves for their well-being and safety.  At the same time, ongoing rising medication costs and difficult access to medical services abroad, especially in the US and Europe, have played a part in boosting the adoption of digital healthcare technology, offering people better access to medical services at lower costs.

These trends have created opportunities for technology-related businesses, especially in the medical and healthcare fields, popularly referred to now as health tech. The health tech trend continues to grow every year in line with Thailand’s transitioning to an aging society and the healthcare well-being trends of all generations. An example of health tech in Thailand is the Pharmacy Management Platform, launched in collaboration with the Ministry of Public Health.  This system can generate and link electronic prescriptions from hospitals to pharmacies so that patients can pick up their medicine at their local pharmacy without having to spend time waiting in long queues at hospitals. Other interesting health tech trends include hospital queue management systems to reduce congestion and waiting times, and service platforms for psychiatrists and psychologists who offer online consultations without the need to see a doctor in person.  

Popular health tech adopted in other countries includes: 

  • Telehealth consultation or telemedicine allows doctors to conveniently analyze symptoms online and refer cases to specialists.  
  • Virtual care technology and tools that can be used for treating less urgent cases through AI-based diagnostics, which runs from cloud databases. Patients can start by simply filling submitting their health records and describing their symptoms so that AI ​​can analyze them. Initial treatment can be performed through home-based monitoring devices.
  • The invention and development of digital innovations for treating serious or chronic diseases such as cancer and diabetes. 
  • Wearable devices that can detect heartbeats or record electrocardiogram data (ECG or EKG), measure blood oxygen or track and analyze sleep quality for basic healthcare analysis. 

Health Tech Investment Options

  • Direct investment in health tech stocks: In Thailand there are only a few stocks related directly to health tech. When it comes to the healthcare business in Thailand, we usually think about hospitals, which account for the majority of healthcare revenue.  With Thailand’s easy access to doctors and medical personnel, the health tech business has not grown as much as in some other countries that do not enjoy such easy access to medical care. Investors interested in health tech-related stocks may consider investing abroad instead, which may need further study of other considerations and risks.
  • Investment through mutual funds in the digital healthcare segments involving new products or services for the healthcare industry.  Companies in this segment are likely to achieve better growth opportunities than traditional healthcare companies, which are mostly large pharmaceutical firms or large hospitals where growth rates may not be as high as digital healthcare companies.  Health tech companies are mostly small in size, with high growth rates, and can be classified into three diverse sub-industry groups:
    1)      Companies that focus on research and development, such as companies servicing large pharmaceutical firms in conducting data research using AI.
    2)      Companies that focus on breakthrough innovations for medical treatments, such as the use of electromagnetic waves for treating cancers or the use of robots for surgery. 
    3)      Companies that focus on enhancing the performance of the healthcare industry, such as providing consultation services via telemedicine.  


Health Tech Investment Risks

  • When investing overseas, in addition to exchange rate risk, investors are exposed to regulatory risks imposed in those countries. In some unusual circumstances, funds may be unable to bring money back into the country, preventing investors from easily receiving the funds they have invested.
  • Political, economic, social, market, and liquidity factors, and legal and/or other restrictions in the country in which the fund invests may affect the value of investment units and/or the liquidity of the fund. 
  • Most stocks in this group are small. Despite their high growth rate, they are also very volatile.  Risk levels for funds in this group are at level 7 out of 8 and considered very high risk. Investment periods should be longer than 5 years.
  • Investment is concentrated in digital healthcare sector funds and investors should diversify their overall investment portfolios.

Embracing advanced healthcare technology undoubtedly enhances the quality and standard of the industry.  However, investors should always consider their investment goals, time period, and risk appetite by carefully studying fund prospectuses to understand the risks before making any investment decisions. 

Nipapun Poonsateansup, CFP®, ACC


Independent Financial Advisor, Author, and Speaker