The healthcare sector is in the midst of a period of unprecedented scientific progress.
Discoveries in genetics, biology, longevity, precision medicine and cell and gene therapy are extending life and starting to show that diseases can actually be cured and not just treated. This progress represents one of the most compelling investment opportunities, capable of delivering superior returns while contributing to positive societal outcomes.
At the same time, healthcare systems are expanding in both scale and complexity. Rising demand and structural inefficiencies are placing increasing pressure on healthcare systems worldwide, with spending in developed economies projected to reach 50% of GDP by 20801. This trajectory intensifies the need for efficiencies and innovations that can reshape healthcare outcomes. In the search for efficiency the focus tends to be on the diagnosis of disease and the delivery of treatments in clinics, hospitals, nursing homes etc.
The structure of the healthcare ecosystem
However, the healthcare ecosystem spans treatment, delivery and diagnostics through clinics and hospitals, as well as the discovery and development of drugs and devices. All of these systems TOGETHER contribute to the efficient delivery of treatment.
Global healthcare spend totals ~$9.8 trillion annually across this ecosystem. Yet only around $180 billion is allocated to drug and device discovery and development – while more than 50 times that amount is spent on delivery, diagnostics and patient care2.
This imbalance highlights a significant opportunity. Innovation today is the treatment of tomorrow and can significantly improve outcomes for patients and reduce delivery costs for healthcare systems. Targeted investment in innovation can therefore unlock disproportionate impact across the broader system. Businesses that successfully translate scientific advances into scalable products and services have the potential to shorten development timelines, reduce costs and expand patient access.
High-growth segments upstream in the ecosystem
Many of the most dynamic and fastest-growing healthcare segments sit upstream.
Biologics, for example, are expected to grow at a ~10% compound annual growth rate (CAGR)3 over the next decade, driven by advances in vaccines and antibodies. Targeted, personalised medicines based on those biological agents will grow even faster and be more effective. Advanced therapies, including cell and gene therapies and regenerative medicine, are growing at ~20% CAGR4 and offer the prospect of addressing previously untreatable conditions.
However, innovation remains capital-intensive and inefficient. Bringing a single drug to market can cost ~$2.6 billion, take more than 15 years from discovery to approval, and only ~10% of candidates ultimately succeed5,6.
Improving productivity across this process represents a substantial value-creation opportunity. For example, the average timeline from discovery to preclinical testing is 4 years, there is a 95% failure rate of all drugs developed, and costs have increased by 22% over the last 5 years.
Moreover, scientists need the labs, the testing facilities, the regulatory expertise, the trial design capability, the facilities to conduct clinical trials and the factories to manufacture their inventions, in order to turn their ideas into drugs that can effectively and efficiently treat patients.
Innovation in practice
X-Chem, a GHO portfolio company, exemplifies this approach by accelerating small-molecule drug discovery process by 12 – 18 months relative to industry norms*. They have had an 80% success rate in identifying viable molecules found and 100 licensed discovery programs.
In cell and gene therapy, innovation is enabling a shift from treating conditions to curing them. There are ~3,000 ongoing gene therapy trials, ~500 in the approvals process, and around 10 approvals each year.
Our portfolio company RoslinCT supports the development and manufacturing of advanced cell therapies that cure disease. It has played a role in enabling the first FDA approved CRISPR gene editing cell therapy for a major inherited disorder, potentially offering a cure for over 6.1m people worldwide. The broader economic implications are equally significant: if fully deployed, such therapies could avoid an estimated $12 trillion in healthcare costs and generate up to ~$18tn7 in GDP impact.
Early detection is another critical frontier. Today, 45.5% of cancers are detected at Stage 3 or 4. Improving early detection dramatically increases survival rates and quality adjusted life years8.
FotoFinder, another GHO portfolio company, has developed skin imaging devices, software and AI-driven solutions with the potential to significantly reduce both the fatality rate and the global costs of skin cancer treatment. In the US, early-stage melanoma detection yields a 99% median five-year survival rate, compared with 35% when the cancer has spread. Treatment costs also rise sharply, from roughly €500 per patient for early detection and removal to around €100,000 at late stage9.
Our investment focus
We invest in businesses that, at their core, advance Better, Faster and More Accessible Healthcare by providing the infrastructure and the tools to accelerate innovation, improving success rates and scalability, and enabling scientific progress — ultimately delivering stronger patient outcomes and more sustainable healthcare systems.
We have invested in 24 companies who operate in the business-to-business technical segments of the healthcare ecosystem. Collectively they have reached ~3.6bn lives, saved 40 months in drug and device development timelines and delivered unique positive societal outcomes.
We believe that businesses with these characteristics embedded in their value proposition enhance the efficiency of healthcare systems, while simultaneously driving growth and operational performance. This combination makes them inherently more resilient and better positioned to deliver long-term value.
You can read more about our approach in our forthcoming 2026 Responsible Investment Report launching on the 31st of March 2026.
