Check Up: Money managers are still bullish on Healthcare; here's what they said

The Healthcare sector has been struggling as the pandemic wanes
But most money managers are still bullish on the sector
The biggest movements and news from ASX healthcare stocks this week

Dr Anthony Faucci, America’s top infectious disease doctor, told the World Economic Forum that there are five stages of the pandemic.

The five stages, in this exact order are: acceleration, deceleration, control, elimination, and finally eradication.

Speaking in January at the height of the Omicron wave, Dr Faucci said the world was still stuck in the first stage, where “the whole world is really very negatively impacted as we are right now.”

But since then, progress has been made and most experts believe that we have now reached the Control stage.

This is the phase of the pandemic that’s often referred to as endemicity, meaning that COVID-19 would become integrated into the broad range of infectious diseases we commonly experience, like the flu or the common cold.

For investors, regardless of where we’re at, the gradual easing of the pandemic has resulted in the dumping of health and biotech stocks globally.

In the US, the benchmark Healthcare Index (INDEXNASDAQ: IXHC) is down 22% this year. On the ASX, the S&P/ASX 200 Health Care [XHJ] is also down 11%.

But now global fund managers are warning against giving up on the sector too soon, especially as we enter into a high inflation cycle.

What the experts say about Healthcare/Biotech

Here’s a quick compilation of what the global asset managers are saying about the healthcare/biotech sector:

JP Morgan:

“With the outlook for healthcare innovation unchanged, waning enthusiasm for those stocks have driven sector valuations to the cheapest in years, cheaper than defensive peers and growth peers,” said JP’s analyst Dubravko Lakos-Bujas.

“While rising energy and inflation costs could be a concern for crowding out healthcare spending in the short term, demographic trends, excess savings, and rising wages all suggest otherwise.

“Based on consensus estimates, healthcare is expected to generate healthy mid-single-digit revenue growth this year and next.”

Citigroup Inc:

“The healthcare sector is an important growth opportunity,” wrote Citi’s Chuck Adams in an investors’ memo.

“We at Citi are committed to continuing to invest in the healthcare business, and attracting and retaining best in class talent is a top priority of our global health-care, consumer and wellness franchise.”

UBS:

“We downgraded consumer discretionary, financials and industrials from most preferred to neutral,” said a note from UBS.

“To accommodate these changes, we upgraded healthcare from neutral to most preferred, and utilities from least preferred to neutral. That leaves us with most preferred views on energy and healthcare, offset by a least preferred view on consumer staples.”

Morgan Stanley:

The bank admitted they are at “a loss for new ideas” this week, but recommended investors to stick with pharmaceutical and biotech companies due to their “defensive attributes” in this market.

Great Hill Capital:

“With Big Pharma losing their patents on many blockbuster drugs, but having tons of cash on their balance sheets, they will be forced to aggressively buy innovation in the biotech sector to maintain and accelerate growth,” Thomas Hayes, chairman of Great Hill Capital in New York, told The Street.

According to data from FactSet, FTSE Russell and Jefferies, the current combined cash balance of Russell 3000 Health Care companies has exceeded $500 billion, an increase of 400% in the past 20 years.

Dakota Wealth Management:

“As far as healthcare is concerned, it is a prime candidate for an inflationary environment,” senior portfolio manager, Rober Pavlik, told Yahoo Finance Live.

“And so I do believe that there are some opportunities in healthcare. Again, there are some very pricey stocks within the group. But I think you could look to the blue chip companies, and probably do quite well in a very choppy trading environment.”

Significant ASX Healthcare moves this week

CODE	COMPANY	PRICE	1 WEEK RETURN %	1 MONTH RETURN %	1 YEAR RETURN %	MARKET CAP
CTE	Cryosite Limited	0.59	20.4%	25.5%	118.5%	$28,065,499
ARX	Aroa Biosurgery	0.9225	16.8%	29.0%	-21.2%	$311,879,029
HCT	Holista CollTech Ltd	0.04	14.3%	21.2%	-20.0%	$11,013,963
ONE	Oneview Healthcare	0.24	14.3%	4.3%	-36.0%	$121,585,415
IMC	Immuron Limited	0.12	14.3%	0.0%	-35.1%	$26,196,810
MDC	Medlab Clinical Ltd	0.11	13.4%	20.9%	-45.0%	$37,639,324
NXS	Next Science Limited	0.895	10.5%	3.5%	-44.9%	$189,311,120
PSQ	Pacific Smiles Grp	2.38	9.2%	13.9%	-15.6%	$382,996,651
AT1	Atomo Diagnostics	0.125	8.7%	4.2%	-41.9%	$65,388,748
VBS	Vectus Biosystems	1.28	5.8%	-1.5%	34.7%	$45,951,530
ICR	Intelicare Holdings	0.1	5.3%	19.0%	-63.9%	$8,638,026
BDX	Bcaldiagnostics	0.11	4.8%	-15.4%	0.0%	$15,130,787
AHC	Austco Healthcare	0.125	4.2%	-3.8%	34.4%	$35,885,709
PAA	Pharmaust Limited	0.091	3.4%	-5.2%	-3.2%	$28,205,202
TSN	The Sust Nutri Grp	0.175	2.9%	52.2%	-58.8%	$18,693,990
ATH	Alterity Therap Ltd	0.0195	2.6%	2.6%	-40.9%	$45,730,617
RAP	Resapp Health Ltd	0.1125	2.3%	38.9%	104.5%	$94,511,678
ACW	Actinogen Medical	0.095	2.2%	-9.5%	63.8%	$174,405,094
IPD	Impedimed Limited	0.1225	2.1%	-18.3%	-2.0%	$213,345,568
GSS	Genetic Signatures	1.34	1.9%	8.1%	-6.0%	$194,120,682
NSB	Neuroscientific	0.275	1.9%	-5.2%	-3.5%	$40,172,060
CMP	Compumedics Limited	0.275	1.9%	-10.6%	-38.9%	$48,719,811
OSL	Oncosil Medical	0.061	1.7%	69.4%	-37.8%	$48,332,941
TRP	Tissue Repair	0.34	1.5%	-5.6%	0.0%	$14,623,371
AHK	Ark Mines Limited	0.465	1.1%	66.1%	1267.6%	$16,821,602
PBP	Probiotec Limited	2.35	0.9%	11.9%	16.9%	$191,110,004
SDI	SDI Limited	0.84	0.6%	-3.4%	2.4%	$99,847,045
MVF	Monash IVF Group Ltd	1.215	0.4%	0.0%	35.0%	$471,458,156
PXS	Pharmaxis Ltd	0.1	0.0%	13.6%	19.0%	$54,892,316
AMT	Allegra Orthopaedics	0.19	0.0%	11.8%	-42.4%	$19,847,249
EXL	Elixinol Wellness	0.056	0.0%	1.8%	-68.9%	$17,394,606
SCU	Stemcell United Ltd	0.014	0.0%	0.0%	-30.0%	$14,696,981
JTL	Jayex Technology Ltd	0.013	0.0%	0.0%	-71.1%	$3,239,971
ICS	ICSGlobal Limited	0.575313	0.0%	0.0%	4.8%	$6,054,605
FFC	Farmaforce Ltd	0.035	0.0%	0.0%	-63.2%	$4,573,834
1ST	1St Group Ltd	0.011	0.0%	0.0%	-49.5%	$5,541,538
BPH	BPH Energy Ltd	0.037	0.0%	0.0%	-58.0%	$24,603,085
ALA	Arovella Therapeutic	0.04	0.0%	0.0%	-2.4%	$26,793,409
PAL	Palla Pharma Ltd	0.295	0.0%	0.0%	-34.4%	$47,764,383
MDR	Medadvisor Limited	0.26	0.0%	-5.5%	-31.1%	$98,322,328
CYC	Cyclopharm Limited	1.5	0.0%	-8.5%	-41.9%	$140,995,983
DVL	Dorsavi Ltd	0.021	0.0%	-8.7%	-40.0%	$7,431,507
ADR	Adherium Ltd	0.01	0.0%	-9.1%	-37.5%	$22,082,511
ZNO	Zoono Group Ltd	0.25	0.0%	-10.7%	-71.8%	$38,274,692
ILA	Island Pharma	0.195	0.0%	-11.4%	-58.5%	$8,433,034
EZZ	EZZ Life Science	0.32	0.0%	-22.9%	-49.2%	$4,083,200
IDT	IDT Australia Ltd	0.16	0.0%	-23.8%	-59.0%	$38,563,488
CGS	Cogstate Ltd	2.2	-0.5%	-3.5%	144.4%	$381,336,996
NEU	Neuren Pharmaceuticals	3.84	-1.0%	-5.0%	201.2%	$484,967,853
PGC	Paragon Care Limited	0.36	-1.4%	-18.2%	60.0%	$231,363,684
HGV	Hygrovest Limited	0.063	-1.6%	3.3%	-40.0%	$14,487,101
RCE	Recce Pharmaceutical	0.89	-1.7%	-7.3%	-17.6%	$150,975,238
GLH	Global Health Ltd	0.285	-1.7%	-3.4%	-45.2%	$16,145,184
DOC	Doctor Care Anywhere	0.265	-1.9%	0.0%	-74.3%	$61,349,430
PAR	Paradigm Bio.	1.29	-1.9%	15.2%	-46.0%	$290,184,639
RAC	Race Oncology Ltd	2.4	-2.0%	-12.1%	-26.2%	$362,109,905
AN1	Anagenics Limited	0.046	-2.1%	7.0%	-32.4%	$10,166,980
VHT	Volpara Health Tech	0.86	-2.3%	12.4%	-33.3%	$219,183,520
S66	Star Combo	0.2	-2.4%	-2.4%	-25.9%	$26,228,081
EPN	Epsilon Healthcare	0.039	-2.5%	-18.8%	-79.5%	$8,685,571
SOM	SomnoMed Limited	1.94	-2.5%	2.1%	0.0%	$164,691,037
CAN	Cann Group Ltd	0.385	-2.5%	51.0%	-24.5%	$134,412,557
CYP	Cynata Therapeutics	0.38	-2.6%	-9.5%	-35.6%	$55,161,489
CAJ	Capitol Health	0.33	-2.9%	-5.7%	-10.8%	$343,931,779
AC8	Auscann Grp Hlgs Ltd	0.065	-3.0%	0.0%	-50.0%	$29,516,656
OPT	Opthea Limited	0.975	-3.0%	-14.1%	-33.4%	$346,660,191
PYC	PYC Therapeutics	0.094	-3.1%	-3.1%	-44.7%	$292,645,201
NOX	Noxopharm Limited	0.31	-3.1%	-17.3%	-50.8%	$94,977,334
IVX	Invion Ltd	0.015	-3.2%	-6.3%	87.5%	$89,831,191
4DX	4Dmedical Limited	0.735	-3.3%	-14.0%	-53.8%	$157,761,601
OIL	Optiscan Imaging	0.145	-3.3%	-9.4%	-68.5%	$89,781,912
OCC	Orthocell Limited	0.4	-3.6%	-5.9%	-20.8%	$80,822,444
LBT	LBT Innovations	0.08	-3.6%	-8.0%	-11.1%	$25,592,124
MVP	Medical Developments	3.5	-3.8%	-11.8%	-38.9%	$251,618,601
RHT	Resonance Health	0.12	-4.0%	-7.7%	-38.5%	$55,302,238
PAB	Patrys Limited	0.023	-4.2%	-8.0%	-11.2%	$47,310,994
1AD	Adalta Limited	0.068	-4.2%	-9.3%	-55.7%	$21,364,563
IBX	Imagion Biosys Ltd	0.0555	-4.3%	0.9%	-61.7%	$61,667,019
RNO	Rhinomed Ltd	0.205	-4.7%	3.2%	72.0%	$56,896,776
PCK	Painchek Ltd	0.04	-4.8%	2.6%	-39.4%	$44,140,387
RHY	Rhythm Biosciences	1.39	-4.8%	6.9%	24.4%	$278,303,584
M7T	Mach7 Tech Limited	0.695	-4.8%	-13.1%	-43.7%	$164,789,973
ALC	Alcidion Group Ltd	0.195	-4.9%	2.6%	-50.9%	$247,273,465
SHG	Singular Health	0.195	-4.9%	-2.5%	-54.7%	$12,404,923
CBL	Control Bionics	0.38	-5.0%	2.7%	-49.3%	$18,119,126
OVN	Oventus Medical Ltd	0.038	-5.0%	-13.6%	-80.0%	$9,185,608
BXN	Bioxyne Ltd	0.017	-5.6%	0.0%	-15.0%	$10,882,472
BWX	BWX Limited	1.875	-5.8%	-12.0%	-60.9%	$308,258,533
TRU	Truscreen	0.063	-6.0%	5.0%	-21.3%	$22,860,574
MXC	Mgc Pharmaceuticals	0.0225	-6.3%	-16.7%	-62.5%	$59,825,310
MEM	Memphasys Ltd	0.058	-6.5%	-27.5%	-17.1%	$46,738,522
RGS	Regeneus Ltd	0.056	-6.7%	-5.1%	-55.2%	$17,466,904
VLS	Vita Life Sciences..	2.05	-6.8%	-10.9%	73.7%	$108,932,105
ACR	Acrux Limited	0.081	-6.9%	-10.0%	-46.0%	$23,608,271
OSX	Osteopore Limited	0.2	-7.0%	17.6%	-59.2%	$23,453,648
EYE	Nova EYE Medical Ltd	0.26	-7.1%	15.6%	-18.8%	$37,843,986
BOT	Botanix Pharma Ltd	0.077	-7.2%	-1.3%	-10.5%	$73,958,798
ADO	Anteotech Ltd	0.125	-7.4%	25.0%	-69.9%	$228,507,606
CU6	Clarity Pharma	0.5	-7.4%	-15.3%	0.0%	$91,830,226
BIT	Biotron Limited	0.072	-7.7%	-13.3%	18.0%	$51,241,088
RAD	Radiopharm	0.235	-7.8%	-7.8%	0.0%	$29,648,290
RAD	Radiopharm	0.235	-7.8%	-7.8%	0.0%	$29,648,290
NYR	Nyrada Inc.	0.165	-8.3%	-21.4%	-46.8%	$25,741,436
MX1	Micro-X Limited	0.21	-8.7%	5.0%	-33.3%	$94,365,455
ANP	Antisense Therapeut.	0.105	-8.7%	-16.0%	-50.0%	$70,223,368
IMM	Immutep Ltd	0.315	-8.7%	-23.2%	-25.9%	$277,196,741
PIQ	Proteomics Int Lab	1.01	-9.0%	-16.5%	-15.1%	$108,877,051
TD1	Tali Digital Limited	0.01	-9.1%	-9.1%	-80.2%	$12,247,917
HXL	Hexima	0.3	-9.1%	-11.8%	71.4%	$47,921,625
TLX	Telix Pharmaceutical	4.38	-9.7%	4.0%	15.3%	$1,352,022,582
VTI	Vision Tech Inc	0.51	-9.7%	-25.0%	-66.0%	$12,255,586
AVE	Avecho Biotech Ltd	0.018	-10.0%	38.5%	-10.0%	$33,080,625
PTX	Prescient Ltd	0.125	-10.7%	-21.9%	28.9%	$81,292,901
NTI	Neurotech Intl	0.049	-10.9%	-22.2%	-22.2%	$34,884,956
IIQ	Inoviq Ltd	0.6325	-10.9%	-26.5%	-79.5%	$61,192,437
MEB	Medibio Limited	0.004	-11.1%	0.0%	-50.0%	$10,786,456
GTG	Genetic Technologies	0.004	-11.1%	-20.0%	-50.0%	$36,935,861
BNO	Bionomics Limited	0.062	-11.4%	1.6%	-75.2%	$86,614,448
IMU	Imugene Limited	0.2075	-11.7%	-23.1%	9.2%	$1,257,333,511
PNV	Polynovo Limited	0.98	-11.7%	-11.7%	-67.9%	$674,921,805
IHL	Incannex Healthcare	0.41	-11.8%	-35.9%	54.7%	$484,151,201
CPH	Creso Pharma Ltd	0.057	-12.3%	0.0%	-70.0%	$75,184,965
LCT	Living Cell Tech.	0.007	-12.5%	7.7%	-43.7%	$7,198,546
DXB	Dimerix Ltd	0.14	-12.5%	-20.0%	-45.1%	$44,922,313
AGH	Althea Group	0.165	-13.2%	-13.2%	-64.5%	$55,217,382
KZA	Kazia Therapeutics	0.92	-13.2%	-5.2%	-33.8%	$129,396,465
CHM	Chimeric Therapeutic	0.125	-13.8%	-16.7%	-54.5%	$39,650,277
UBI	Universal Biosensors	0.675	-14.0%	-17.7%	-10.0%	$124,591,953
LDX	Lumos Diagnostics	0.325	-14.5%	-20.7%	0.0%	$48,248,633
CDX	Cardiex Limited	0.34	-15.0%	-19.0%	-50.0%	$38,483,795
NC6	Nanollose Limited	0.092	-16.4%	-20.0%	-16.4%	$14,144,205
IRX	Inhalerx Limited	0.1	-16.7%	5.3%	-4.8%	$17,689,030
ATX	Amplia Therapeutics	0.125	-16.7%	-7.4%	-50.5%	$25,201,020
RSH	Respiri Limited	0.051	-19.0%	-10.5%	-55.7%	$36,864,880
ALT	Analytica Limited	0.0015	-25.0%	-25.0%	-62.5%	$6,920,702
ZLDDG	Zelira Therapeutics	2.2	-30.2%	-33.8%	-79.0%	$21,069,655
OSP	Osprey Med Inc	0.21	-32.3%	-37.3%	-88.3%	$6,158,050

Cryosite Limited (ASX:CTE) was the biggest mover this week. The clinical trials logistical company hasn’t released any news in a month, but back in March it did announce a change in chairmanship and buying of shares from its directors.

Aroa Biosurgery (ASX:ARX), a soft tissue regeneration company, reported a FY22 full year product revenue of NZ$37.7 million on a constant currency basis. This represents a growth of approximately 84% on FY21, and exceeds the company’s guidance of NZ$34-37 million.

Holista Colltech (ASX:HCT) has received its first commercial order from Country Farms for its innovative food ingredients to be used by Starbucks Malaysia, and sold into Country Farm’s modern trade channels in Malaysia. The initial order was worth $43k AUD for Holista’s low glycaemic index (GI) food ingredient GI Lite, and its sugar reduction substitute, 80Less.
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Immuron’s (ASX:IMC) sales of Travelan in North America were up by 185%, and worldwide gross sales grew by 216% YoY in the third quarter of FY22, reaching $193k. Travelan is an orally administered passive immunotherapy that reduces the likelihood of contracting travelers’ diarrhea.

MedLab Clinical (ASX:MDC) announced a northern hemisphere trade deal with the former contract manufacturer of NRGBiotic. The three-year trade deal with UK-based Cultech Limited will see CulTech market NRGBiotic to UK pharmacies and health food stores