Predicting the pills
By Jane McFadyen
Knowing what investments will bring great rewards is not easy. There is no crystal ball to tell us which way the markets of the future will swing. Learning about new developments in technology and other fields is one way of keeping apace with industry trends, and the area of healthcare is no exception.
Who could have foreseen the rapid development of anti-virals used in combating the AIDS virus? Did anyone know that tuberculosis would make a comeback? You may have all the epidemiological evidence in the world available, but accurately predicting which diseases will break out where is beyond anyone’s capability.
Health indicators however can help clinicians and investors make an educated guess as to what drugs are going to be needed, in both the developed and the under developed worlds.
According to figures from the World Health Organization we can see that the causes of death varies between high- and low-income countries.
Source: World Health Organization
Looking at the tables above we see that in a low-income country 7.8% of people will die from AIDS related illness. The disease doesn’t even make it into the top ten in high-income countries. Low-income countries also see a prevalence of infectious disease and pregnancy/infant-related deaths.
High-income countries face different problems. Cancers, high blood pressure and smoking-related disease are predominant. These are illnesses that can often be attributed to a Western lifestyle. High-income countries also suffer more chronic disease explained in part by the fact that people usually live beyond 70 year of age.
Thus, when building an investment portfolio that leans heavily on pharmaceutical companies, the investor has to make the ethical choice between backing drug producers that focus their development on the diseases of the world’s wealthy or the world’s poor. In other words, is it better to invest in helping the poor improve their life expectancy, or helping those whose demise is likely due to poor diet, dangerous habits and lack of exercise?