Healthcare has always been a strange hybrid in the market. It offers the stability of recurring demand but the drama of innovation cycles that can swing earnings wildly. After two years dominated by artificial intelligence and technology stocks, healthcare’s relative silence has made it look dull. That may now be the reason it looks interesting again. When momentum cools elsewhere, capital tends to circle back to steady cash flow and discounted valuations—and that is where healthcare finds itself today.

According to Reuters, fund managers have begun dipping back into the sector. The logic is simple: earnings are still growing, margins are holding, and valuations have compressed. The S&P 500 trades at about twenty-two times forward earnings, while large-cap healthcare now sits near seventeen. That discount has not been this wide since 2018. For portfolio managers who missed the AI rally or want to reduce exposure to richly priced tech, healthcare looks like the next logical stop.

Exchange-traded funds are often the first place that shift shows up. The Health Care Select Sector SPDR Fund (XLV), which holds giants like UnitedHealth, Johnson & Johnson, and Eli Lilly, has seen modest inflows since July after months of outflows. The iShares U.S. Healthcare ETF (IYH) and Vanguard Health Care ETF (VHT) have also ticked higher, helped by dividends and a small rebound in big pharma. These are not explosive moves, but they hint at a change in sentiment. Passive investors tend to be cautious; they move when they believe downside risk has mostly been priced in.

Under the surface, the sector is being pulled in two directions. Drugmakers remain under pressure from patent expiries and the U.S. government’s drug-price negotiation program, which continues to create headlines and uncertainty. At the same time, devices and diagnostics are enjoying a rebound as elective procedures rise and hospitals return to normal schedules. Companies like Abbott, Intuitive Surgical, and Stryker have posted solid results, showing that pent-up demand for surgeries is still playing out. For ETF investors, this creates a classic barbell: lagging pharmaceuticals on one side, steady device makers on the other.

The weight-loss boom adds another wrinkle. Investors who once saw obesity drugs as a biotech story are now treating them as a healthcare macro theme. Novo Nordisk and Eli Lilly continue to dominate, but their success has spilled over into suppliers, testing companies, and logistics providers that form part of the ETF ecosystem. Analysts say this ripple effect could support sector earnings even if pricing pressure squeezes margins later on. In other words, the story is broadening beyond a few ticker symbols.

What makes healthcare ETFs attractive at this stage is not explosive growth but resilience. In a market where investors are paying high multiples for every hint of innovation, healthcare offers reliable demand, balance sheets flush with cash, and exposure to demographic trends that are not going away. Populations are aging, chronic disease is rising, and governments are spending more on healthcare infrastructure. Those forces make drawdowns temporary rather than permanent.

Still, a few caution flags remain. Political risk will increase as the U.S. election approaches. Drug pricing and Medicare coverage will likely feature in campaign debates, which could trigger volatility for pharmaceutical-heavy ETFs. Hospital chains also face labour cost inflation and potential reimbursement adjustments. And while the sector’s valuation discount looks appealing, it can stay wide for longer if investors continue to chase tech momentum.

For now, the case for healthcare ETFs comes down to timing and temperament. If you are looking for short-term excitement, there are flashier trades. But if you want a steady allocation that can weather multiple economic cycles, this may be a moment to look again. The sector’s earnings base is intact, dividend yields are attractive, and the recent pullback has created room for new buyers.

In past cycles, healthcare has often been the quiet performer that outlasts the hype. The same may be true again. Whether the next six months bring a full rotation or just a pause before another round of tech enthusiasm, the groundwork for a comeback is being laid in slow, patient flows of ETF capital.

Sources

The post Are Healthcare ETFs Ready for a Comeback or Just Catching Their Breath? appeared first on Canada's Health Magazine.

The business logic is simple. Canada has a shortage of family doctors in many communities, and provincial governments have been expanding what pharmacists are allowed to do. When scope grows, the value of a pharmacy’s square footage grows with it. A consultation room that once sat empty can become a profit centre. A pharmacist’s clinical time can be billed through public or private channels, depending on the service and province, which turns a historically low margin retail business into something steadier and more service based. The payoff is not only today’s clinic fee. Every clinical visit tends to drive a bundle of high margin add ons that retailers already know how to monetise, from vaccinations to over the counter products, and it builds loyalty with customers who have heavy health needs.

Policy is blowing in the same direction. In 2025 Ontario signalled another expansion of pharmacist prescribing for minor ailments, part of a wider push to take pressure off emergency rooms and family practices. Research suggests the public is ready. A national Leger survey this spring found Canadians increasingly view pharmacists as frontline providers who can safely take on more assessment and prescribing work, which matters when you are betting on long term adoption rather than a one time pandemic surge.

For Loblaw, which owns Shoppers, the strategy helps diversify away from food margins that can swing with inflation and competition. Health and wellness already underpin loyalty programs and private label sales. Adding clinical services deepens those ties, keeps foot traffic predictable through the week, and creates reasons to visit the store that do not rely on discounting. It also positions the company for direct contracts with employers and insurers who want quicker access for their members, especially for routine care that does not need a physician visit. The Surrey rollout is a local story, but it is also a template. If unit economics hold up, clinics can be replicated across urban and suburban locations where the company already controls real estate and staff.

The move will not go unchallenged. Telus Health has spent the past few years building a national employer wellbeing platform and virtual care network. Its Workplace Options acquisition added millions of covered lives and deeper relationships with HR teams that could become a distribution channel for in-person care. WELL Health, a consolidator of medical clinics and digital platforms listed on the TSX, reported record quarterly revenue in August and its first quarter with more than one million patient visits in Canada, a sign that hybrid models still have plenty of room to grow. In other words, the fight for the front door is on. Pharmacies bring convenience and location. Tech enabled clinic groups bring depth of care and physician networks. Employers are an important swing voter because they influence where workers go for first contact care.

Investors should think about this shift the way retailers think about store layout. Clinical rooms reclaim underused space and draw customers deeper into the box. A pharmacy care visit creates predictable traffic patterns that can be planned around, which improves labour scheduling and inventory turns. The data flywheel spins faster because clinical interactions add context to retail baskets. That opens the door to targeted programs for chronic conditions, loyalty offers that tie to adherence, and integrated online booking that keeps customers in a closed loop. None of this requires a moonshot technology breakthrough. It requires execution, consistent scope of practice, and a steady pipeline of trained pharmacists and nurse practitioners.

There are risks that deserve attention. Staffing is the most obvious one. Pharmacy teams have shouldered heavy workloads since the pandemic, and clinics add more demands to a finite number of clinicians. If staffing falls behind growth, service quality slips, and the reputational hit can be hard to reverse. Reimbursement is another wildcard. Provinces pay for some services and not others, and rate cards can change with budgets. Investors should watch for signs that provinces lock in sustainable fees for assessments and prescribing, since that underpins return on the fit-out of clinic rooms and the added payroll. Physicians will also have views. Many welcome pharmacists taking minor cases off their desks, but professional tensions can surface if the line between routine care and more complex management blurs.

The competitive backdrop in the United States offers a cautionary tale and a contrast. Major chains south of the border spent big to bolt clinics onto pharmacies, then pulled back as costs and utilisation failed to match optimistic models. Walgreens’ VillageMD strategy has been unwound, and recent reporting suggests the company’s new owners are exiting primary care and planning more store closures, which has raised questions about access and the viability of clinic-inside-a-pharmacy economics when payer mixes are tough. Canada is not the United States. Payment systems, pharmacy ownership rules, and patient expectations differ. Even so, the lesson travels. Clinics need the right mix of services, reliable funding, and clear operational guardrails to succeed at scale.

If you zoom back out, the Surrey launch reads like a small but telling signal. Primary care is getting closer to where people already are, inside grocery anchored plazas and high street corners. That is good for patients who want same day access for straightforward problems. It is good for health systems that need to protect scarce physician time. It can be good for investors who understand that a retail box can become a clinic without turning into a hospital. The trick is to remember that health is still a service business. Outcomes and experience will decide which models scale. The companies that pair simple access with disciplined operations are likely to be the ones still opening clinics a year from now.

Sources

Shoppers Drug Mart opens seven Pharmacy Care Clinics in Surrey, press release, 12 Sep 2025: https://www.loblaw.ca/en/shoppers-drug-mart-officially-opens-doors-to-seven-pharmacy-care-clinics-in-surrey-bc/

Yahoo Finance repost of Shoppers Surrey clinics announcement, 12 Sep 2025: https://finance.yahoo.com/news/shoppers-drug-mart-officially-opens-160000509.html

Leger, Pharmacists’ expanding role in Canadian healthcare, 2 Apr 2025: https://leger360.com/market-intelligence-pharmacists-expanding-role-in-canadian-healthcare/

MAPflow summary of Ontario’s 2025 pharmacist prescribing expansion signal, 25 Feb 2025: https://www.mapflow.ca/blog/new-ailments-coming-soon-in-ontario

WELL Health reports record revenue and more than one million Canadian patient visits in Q2 2025, 14 Aug 2025: https://news-releases.well.company/news-releases/well-health-reports-record-revenue-adjusted-ebitda-and-adjusted-net-profit-in-q2-2025-upgrades-guidance-and-delivers-first-ever-quarter-with-more-than-1-million-patient-visits-in-canada/

Telus Health acquires Workplace Options and announces GTCR partnership, 13 to 14 May 2025: https://www.telus.com/health/press-releases/telus-health-acquires-workplace-options-top-provider-wellbeing-services-fortune-500-companies

Walgreens pullback coverage, 2 to 5 Sep 2025: https://www.forbes.com/sites/brucejapsen/2025/09/02/with-walgreens-exiting-primary-care-villagemd-has-hundreds-of-sites-to-sell/ and https://www.healthcare-brew.com/stories/2025/09/05/walgreens-private-equity-takeover-layoffs-pharmacy-closures

The post Pharmacies Are Becoming Canada’s New Front Door to Primary Care appeared first on Canada's Health Magazine.

The investment case starts with convenience. Injections built a huge market, yet a weekly shot is still a hurdle for some people. A daily tablet removes that friction. Pills are easier to ship and store, which matters when a category scales into the tens of millions of prescriptions. As Reuters reported, several companies are racing for the finish line, and the market for weight-loss medicines could top 150 billion US dollars early in the next decade. Many of the new candidates are small molecules rather than peptides, so manufacturing looks more like traditional pills than sterile injectables. That can lower unit costs over time and smooth out supply, two points investors care about when modelling margins and capacity.

The near-term catalyst is Novo Nordisk’s application for an oral version of Wegovy after the US FDA accepted the filing in May, with a decision window in the fourth quarter of 2025. Novo has reported around 15 percent average weight loss with once-daily oral semaglutide at the highest dose in trials, which would be competitive with many injectable regimens if that number holds up in the real world. A green light would give prescribers an easy on-ramp for patients who are needle shy. It would also give pharmacies a product that fits into existing pill workflows rather than the cold chain injectables require.

Eli Lilly, Novo’s main rival, moved the story forward with phase 3 results for its pill orforglipron. The company said the study met its main goals, with average weight loss of about 12 percent over 72 weeks. Market reaction was mixed since investors had hoped for numbers closer to the best injectables. For the business, the message is still significant. A viable daily pill gives Lilly a second engine alongside its fast-growing injectables, and the company raised full-year guidance, a reminder that demand remains strong even as the product mix starts to change.

The field is getting crowded. Structure Therapeutics is pushing a small molecule called aleniglipron through late-stage testing, with more data expected by year end. Roche has an oral candidate from the Carmot acquisition that showed meaningful early weight loss and is now moving through mid-stage trials. AstraZeneca and Eccogene have another oral GLP-1 in phase 1b work in China. Viking Therapeutics is testing both an injectable and an oral version of its dual agonist, giving it two shots on goal across different price points and patient preferences. More players mean more negotiating power for insurers, more choice for doctors, and more potential for price tiers that look like other big primary care drug classes. For investors, it also means more catalysts and more volatility as data and regulatory dates hit the tape.

Pricing and access will decide who wins the profit share. Payers tolerated high prices for the first wave because savings on complications can be large. Pills could push that debate in two directions at once. On one hand, scale and simpler manufacturing may pull prices down, which expands the market and can still grow revenue if volume jumps. On the other hand, more competitors give pharmacy benefit managers room to push for steeper rebates and tighter formularies. Expect step therapy rules that nudge new patients toward a preferred pill first, with injectables reserved for those who need the biggest effect or who cannot tolerate a tablet. Those dynamics echo cholesterol and blood pressure markets, which settled into multi-tier pricing with room for several brands.

Supply and logistics are another lever. Companies spent the past two years racing to add sterile filling lines and cold storage for injections. Pills shift the bottleneck to chemical synthesis and tableting capacity, which is far more common in the industry. That does not guarantee a smooth launch, but it lowers the risk of empty shelves that frustrate patients and dent brand loyalty. Pharmacies also prefer pills because they move through existing inventory systems, require less pharmacist time per script, and keep more refill traffic in store. If pills take off, expect more retail partnerships, direct-to-employer contracts, and digital refills that create stickier customer relationships across the chain.

Investors should watch side effects and adherence. Nausea and other gastrointestinal issues have been the main reason people stop therapy, and daily pills could push adherence in either direction. Some patients will prefer taking a tablet with breakfast. Others may find a weekly shot easier to remember. Real-world persistence will feed back into revenue forecasts and may influence payer coverage rules. Safety will remain under the microscope until millions of patient years of data accumulate. That is standard for a mass market class, but any surprise in the label can swing share quickly.

Earnings momentum suggests the category still has room to run, even as expectations reset week by week. Lilly’s latest results showed a large revenue jump on injectables, and Novo posted double-digit growth for the first half while cautioning about costs and competition. Big cash flows give both companies room to price with strategy, invest in more capacity, and fund new indications. Those same cash flows also fund deal-making, so do not be surprised if smaller pill makers become targets before the first approvals arrive.

The simple version is this. Pills will not replace shots overnight, and the best injectables may remain the gold standard for fast and deep weight loss. Daily tablets can grow the pie, smooth logistics, and give insurers a cheaper option that still moves the needle on outcomes. That mix is good for patients who want choice, and it can be good for investors who build a diversified position across leaders and promising entrants. The next twelve months will bring decisions, more data, and likely a few deals. By this time next year, the weight-loss market may feel less like a two-horse race and more like an entire league.

Sources

The post Weight-Loss Pills Are Coming. What It Means for Investors appeared first on Canada's Health Magazine.

Behind the modest rally is a simple reality: patients are finally getting procedures they put off for two years. Hospital operator HCA Healthcare told investors in April that admissions rose 2.6 percent in the first quarter and that demand for knee replacements, cataract fixes, and other discretionary operations shows no sign of fading. reuters.com More procedures mean more screws, catheters, and pacemakers, so suppliers are shipping inventory at a healthy clip. Intuitive Surgical, the robot maker that sits near the top of IHI’s holdings, said in January that global use of its da Vinci systems jumped 18 percent year on year and that it expects at least a low-teens percentage lift for 2025 as hospitals work through backlogs. reuters.com

Investors drawn to the story have a short menu of vehicles. IHI is the large-cap, market-weight option with roughly five billion U.S. dollars under management. It leans heavily on familiar brands such as Abbott Laboratories, Intuitive Surgical, and Boston Scientific. By contrast the SPDR S&P Health Care Equipment ETF (XHE) spreads its money equally across about sixty names, so smaller innovators carry as much weight as giants. That structure looks great when start-ups are in favour, but it can sting when interest rates are high and cash-burning companies trade at a discount. As of the end of May, XHE was still down eight percent for the year. ssga.com

Performance gaps like that raise a question: is the recent bounce just the last gasp of a recovery trade or the start of something longer? One clue lies in a wave of takeovers that has swept through the sector. Big medical-technology companies have decided it is cheaper to buy the next breakthrough than to build it themselves, and that desk-drawer pipeline is often sitting in the very same small caps that XHE owns.

The string of deals started last April, when Johnson & Johnson agreed to buy Shockwave Medical for about 13 billion dollars. Shockwave’s catheter sends sound waves through clogged arteries, a niche that fits neatly beside J&J’s existing cardiovascular lines and promises a ten-billion-dollar addressable market, according to analysts quoted at the time of the announcement. reuters.com Less than nine months later Stryker reached for Inari Medical in a 4.9 billion-dollar all-cash deal, betting that Inari’s minimally invasive tools for dangerous blood clots will accelerate its own push into peripheral-vascular care. reuters.com Boston Scientific followed suit in January with an agreement to acquire privately held Bolt Medical, aiming to expand its cardiovascular portfolio even further. news.bostonscientific.com

These transactions matter for ETF holders because the funds receive a takeover premium overnight, then recycle the cash into the next target. Every buy-out also signals to the market that strategic buyers see value the stock market has missed. Portfolio managers at several Canadian pension funds now argue that the combination of rising hospital volumes and a steady bid from cash-rich acquirers puts a floor under the device group even if macro conditions wobble later this year.

There is another tailwind: hospitals are finally spending on capital equipment again. Executives at HCA and Tenet have told Wall Street that staffing shortages, once a drag on volumes, are easing. With operating rooms humming, administrators can justify orders for new robots, imaging consoles, and patient-monitoring systems. The mix of procedures is also evolving. Weight-loss drugs have grabbed headlines, but surgeons still implant heart valves, repair joints, and remove tumours. In many cases those drugs extend life and therefore enlarge the pool of people who will eventually need surgery. Some device makers, such as Boston Scientific, are even eyeing combination therapies in which digital health tools track patients after procedures, creating recurring revenue streams that were rare in the old single-use-device model.

Of course, medical devices are not immune to risk. The sector faces the same tariff overhang that worries pharmaceutical importers, and a strong U.S. dollar can pinch earnings translations for global players. Supply-chain kinks linger on certain microchips and sterile plastics. There is also the elephant in the operating room: insurance reimbursement. If elective surgeries keep rising faster than expected, insurers could lean harder on hospitals to hold down prices, a step that would eventually ripple back to suppliers. Still, device companies have navigated pricing pressure for decades and have generally used innovation to stay one step ahead.

For investors who prefer to let someone else pick the winners, an ETF remains the easiest way to gain exposure. IHI offers stability through its heavy dose of blue chips and has a thirty-five basis-point expense ratio, while XHE brings lottery-ticket upside, along with more volatility, at roughly the same fee. A third option, the First Trust Indxx Medical Devices ETF, is much smaller and less liquid, which makes it suitable only for investors willing to accept wider bid-ask spreads.

The bottom line is that the medical device story in 2025 is no longer just about filling post-pandemic backlogs. Hospitals are investing for growth, makers of hardware and software are merging to grab share, and the pipeline of robots, AI-guided imaging systems, and minimally invasive tools looks busy enough to keep that cycle turning. Investors who want a simple doorway into the theme can still find it in a low-cost ETF, but they should understand the differences under the hood before writing the ticket.

Sources

iShares U.S. Medical Devices ETF, fund page, data as of 3 July 2025

SPDR S&P Health Care Equipment ETF, performance table, State Street Global Advisors, 31 May 2025

HCA Healthcare beats profit estimates on strong demand for medical care, Reuters, 25 Apr 2025

Intuitive Surgical beats estimates on strong demand for surgical robots, Reuters, 23 Jan 2025

Johnson & Johnson to buy Shockwave Medical in 13 billion-dollar deal, Reuters, 5 Apr 2024

Stryker strikes 4.9 billion-dollar deal for Inari Medical, Reuters, 6 Jan 2025

Boston Scientific announces agreement to acquire Bolt Medical, company release, 8 Jan 2025

The post Medical Device ETFs Get a Lift from Surgery’s Return and a Wave of Acquisitions appeared first on Canada's Health Magazine.

Vertex’s first-quarter numbers, published on 3 May, showed 14.2 million US dollars in Casgevy revenue. That total is a rounding error beside the 2.8 billion dollars the company earned from its cystic-fibrosis drugs, but it marks the moment gene editing moved from laboratory promise to ledger entry. A reimbursement figure of roughly two million dollars per infusion demonstrates that insurers will pay a premium when the alternative is lifelong transfusions and organ damage. Still, the result fell short of the 17 million dollars many analysts had pencilled in, and Vertex shares slipped after brokers trimmed full-year forecasts. On the earnings call management said demand is not the problem; capacity is. Sixty-five US hospitals are authorised, yet each must train staff, build or refurbish clean-room suites, and negotiate one-off reimbursement agreements before treating its first patient. Those prerequisites turn every hospital launch into a multi-month renovation and paperwork exercise.

Competition is already lining up. Bluebird bio’s lentiviral rival, Lyfgenia, won US approval on the same December day as Casgevy. Bluebird recorded its first commercial cell collection last autumn and expects initial paid infusions later this year, with about sixty American centres ready to dose patients. Rather than cannibalising one another, the existence of two multi-million-dollar cures can reassure payers that treatment capacity will remain available even if one manufacturer encounters a supply hiccup, and parallel negotiations introduce welcome transparency on price.

Europe is moving even faster. On 31 January England’s National Health Service said it would fund Casgevy for roughly fifty patients each year, the first time the NHS has agreed to underwrite a two-million-pound therapy. Many continental agencies benchmark against NHS England when setting reimbursement rules, so the decision could accelerate coverage approvals across Europe and shape value discussions with American insurers.

While Casgevy and Lyfgenia rely on ex-vivo editing, where cells are modified outside the body, the next wave aims to fix genes in situ. On 3 April Intellia Therapeutics dosed the first participant in its global Phase 3 study of nexiguran ziclumeran for hereditary transthyretin amyloidosis. If the trial succeeds, the drug could become the first systemically delivered CRISPR therapy administered as a single infusion that silences a toxic liver protein responsible for nerve and heart damage in roughly seventy-five thousand people in high-income markets.

Base-editing pioneer Beam Therapeutics is racing on another front. In mid-May the firm announced that it would present fresh data from seventeen patients treated with BEAM-101, a base-edited sickle-cell therapy, at the European Hematology Association congress in June and that it expects to treat thirty participants by year-end. Base editing swaps a single nucleotide without cutting the DNA double helix, potentially offering a cleaner safety margin than the original CRISPR scissors, although the approach remains untested at scale. Investors will be watching Beam’s presentation for signs that new editing tools can match or surpass the first generation.

Money is flowing almost as quickly as the science. Grand View Research estimates that genome-editing products and tools will generate about 11.8 billion US dollars this year and could swell to 25 billion dollars by 2030, a compound annual growth rate near sixteen per cent. Most observers expect therapeutics eventually to dominate because each successful one-and-done infusion displaces decades of chronic-care spending. Yet cash alone cannot propel the field. Physical capacity may prove the decisive near-term choke point; every Casgevy or Lyfgenia batch monopolises a manufacturing suite for weeks, so revenue cannot outpace clean-room construction. Payment models are evolving as well. Major US insurers are starting to demand money-back guarantees if patients relapse, while the NHS secured a confidential discount. Such risk-sharing could compress margins once additional players arrive. Safety will shadow the sector too. Regulators require fifteen-year patient registries to monitor off-target edits and secondary cancers, and a single late complication could rattle confidence across every programme built on the same molecular machinery.

None of these caveats dull the significance of this spring’s milestone. Real cash from a CRISPR therapy is now appearing in financial statements, taxpayers on both sides of the Atlantic are footing million-dollar invoices, and patients such as DJ Chow are walking out of hospital free of the genetic chains they were born with. The challenge ahead is to streamline manufacturing, widen access, and extend gene editing from rare blood disorders to heart, liver, and neurological diseases that affect millions. Investors willing to shoulder scientific and regulatory uncertainty may finally be looking at an industry that offers cash flow as well as promise, a clear sign that gene editing has crossed the bridge from laboratory marvel to commercial reality.

Sources

Vertex Pharmaceuticals – Q1 2025 Earnings Release (3 May 2025)

U.S. Food & Drug Administration – “FDA Approves First Gene Therapies to Treat Patients with Sickle Cell Disease” (8 Dec 2023)

NHS England – “Revolutionary Gene-Editing Therapy for Sickle Cell Offers Hope of a Cure” (31 Jan 2025)

bluebird bio – Lyfgenia Commercial-Launch Update (9 Oct 2024)

Intellia Therapeutics – First-Patient-Dosed Press Release for MAGNITUDE-2 (3 Apr 2025)

Beam Therapeutics – BEAM-101 Data Preview for EHA 2025 (14 May 2025)

Grand View Research – Genome Editing Market Size & Trends Report (accessed 28 May 2025)

The post Gene Editing Cashes In: Casgevy’s First Sales Signal the Commercial Dawn of DNA-Editing Technology appeared first on Canada's Health Magazine.