Global investor looking to Middle East healthcare sector

Pexels/Chokniti Khongchum

• Janus Henderson Investors explores options
• Firm has 20% of fund in international markets
• Focus on the biotech industry

The global asset management group Janus Henderson Investors is targeting the Middle East’s trillion-dollar medical sector to deliver healthy returns.

The group has $308 billion in assets under management and 24 offices globally, including one in Dubai International Financial Centre since 2012.

The healthcare team’s strategy has a pot of more than $10 billion, while its biotech funds combined reaches more than $1 billion.

Andy Acker, portfolio manager on the healthcare team at Janus Henderson Investors, said during a visit to the region this month: “We have over 20 percent of the fund in international markets, across Europe, Asia and we’re definitely looking at the Middle East as another opportunity.

“We’re seeing substantial demand for healthcare and healthcare investing from some of the large sovereign wealth funds in the region and some of the large family offices.”

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The UAE and Saudi Arabia top the list regionally in terms of healthcare spending, with the sector forecast to reach $135 billion by 2027, a report by Alpen Capital said.

The figures imply an annualised growth rate of 5.4 percent from $104 billion last year.

Sameena Ahmad, managing director of Alpen Capital (ME) Ltd, said: “We anticipate that the region will offer an array of investment opportunities on the back of privatisation initiatives and increasing adoption of technology to create alternative healthcare models.,”

Acker said investing in new hospitals was a particular area of interest.

“Where we see the biggest opportunities would be on the healthcare services side, especially hospitals and providers as countries make the shift from public hospitals to private hospitals,” he said.

Faced with an increasing population, the region is likely to require 12,207 new hospital beds by 2027, Alpen Capital said. This translates into an estimated annual average growth of 1.9 percent since 2022, to reach a collective bed capacity of 133,731.

Diabetes and obesity rise

Acker said that Janus Henderson was also looking to address metabolic diseases, including diabetes and obesity. “Very similar to the United States, this area, as much of the world, is facing an epidemic of diabetes and obesity,” he said.

The group’s global life science strategy has about a 30 percent allocation to biotech, Acker said, and it was also invested in innovative medical device companies that offer attractive growth at good prices.

“The biotechnology industry is not nearly as well developed here as in the US market,” he said.

Ackers, an American, who has been with Janus Henderson for 24 years, forecast 2023 will be a “record year” for new product approvals, with 59 new medicines given the go-ahead by the Food and Drug Administration (FDA) in the US.

“Right now we don’t have any current investments [in the Middle East]. That’s why we’re out here and looking and kicking the tyres to see what the opportunities are,” he said.