Why Healthcare and Pharma Are Back on Investors’ Radar

Healthcare has been drawing more interest on ETF Explorer lately. In Q3, the number of funded portfolios across our healthcare asset classes grew by 47%¹, with Pharmaceuticals being the largest of the group. 

Here are a few developments that may help explain why.

Three forces shaping healthcare

• Medical innovation: From weight-loss drugs to cancer therapies, new treatments continue to reshape the pharmaceutical industry. Encouraging clinical trial results and renewed merger activity have also helped drive gains in biotech stocks.
• AI usage: Healthcare companies are increasingly using AI to streamline operations and support drug discovery. While the financial benefits are still emerging, wider adoption could improve efficiency and help accelerate the development of new treatments over time.
• A potential earnings recovery: While healthcare earnings growth has been subdued in 2026, analysts expect a stronger recovery in 2027. The broader sector’s traditionally defensive characteristics may also appeal to investors looking to diversify beyond technology.

Participate in the story

For investors interested in more sector exposure, here are some asset classes on ETF Explorer that capture different parts of the healthcare landscape:

Pharmaceuticals

+11.1%² 5Y returns | +22.6%² 1Y returns

This ETF holds large global drugmakers, including Eli Lilly, Novo Nordisk, Johnson & Johnson, Novartis, and others. Demand for their medicines tends to hold up through economic cycles.

Explore the ETF on the app →

Global Healthcare

+6.1%² 5Y returns | +15.9%² 1Y returns

Broad exposure to healthcare companies worldwide (drugmakers, medical device makers, insurers, and care providers), so you're not relying on any single part of the sector.

Explore the ETF on the app →

Biotechnology

+6.0%² 5Y returns | +36.5%² 1Y returns

Companies developing new treatments, from gene therapies to next-generation medicines. Unlike large drugmakers, many biotech companies depend on a few drugs in development, so prices can often swing more sharply.

Explore the ETF on the app →

We're sharing this to help you make informed decisions. Carefully consider your personal objectives, financial situation, and needs before investing. Since sector equities can be volatile, targeted exposure can increase both potential upside and risk.

StashAway reserves the discretionary right to change the underlying ETF for specific asset classes.

¹ Based on the growth in the number of funded StashAway ETF Explorer portfolios across Pharmaceuticals, Healthcare, US Healthcare, Biotechnology, Genomics, and Medical Devices, comparing 1 April - 30 June 2026 versus 1 July - 30 September 2026.

² Annualised performance is as of 12 October 2026 and assumes that dividends were reinvested. All returns shown are in USD terms and calculated before fees and taxes. Past performance does not guarantee future performance. Source: Bloomberg.