Patient-centric med-tech could underperform near-term as elective surgical volumes decline.
Bigger ticket items could also suffer as hospital capex projects are delayed with focus on other, more pressing matters.
Critical care equipment providers may see demand if production can be ramped up in a reasonable timeframe.
Diagnostics providers exposed to respiratory testing could see increased demand too.
Dental may struggle as patients defer visits through social distancing and then, longer-term, consumers may seek to reduce out-of-pocket or discretionary expenditures in the event that they are directly impacted by the economic fallout from coronavirus.
The same goes for hearing aid suppliers, which are quasi retail companies with fixed costs serving an elderly population.
As the dust settles
As older people are made to stay indoors (and they cannot get to the hearing aid shop) these companies will suffer in the short-term.
Pharmacies make money on wellness and beauty and happen to serve prescriptions.
They probably won’t fare as well as you might imagine, but pharmaceutical wholesalers (distributors) should fare okay as they operate largely on a fee-for-service basis.
When the dust settles and Covid-19 has thankfully become a historical consideration, the ‘new normal’ will still involve the same demographics of a growing and ageing population.
So expect a continuation of the multi-decade trend of increasing healthcare consumption.
The inefficiencies of the current healthcare model have been amply demonstrated.
Better models of care (digital first, telemedicine, alternative sites for care delivery to reduce strain on hospitals) have demonstrated their value in a timeframe that is shorter than we expected.
This will trigger system-wide change.
Paul Major is a trust manager at BB Healthcare
