Uncovering Opportunities in Small/Mid Cap Equity

The Fiera Apex team sees several secular themes around driving efficiency and finding novel solutions in the Healthcare and Technology sectors which make small and mid-cap companies attractive investment opportunities.

Healthcare

Driven by prolific innovation, along with demographic tailwinds, resilient demand, and strong fundamentals, we believe SMID cap healthcare holds some of the greatest potential for long-term growth.

Within the SMID biotech subsector, significant opportunities can be found in companies that focus on addressing unmet medical needs with de-risked clinical assets and broad market upside. Prescription drug spend in the United States is over $400 billion annually and growing. However, current FDA-approved therapies address only a fraction of defined illnesses, reflecting vast, untapped TAMs waiting for solutions. Concentrated on R&D and supported by ongoing advances in life science technologies, SMID biotech is poised to deliver numerous near-term breakthroughs across the spectrum of human health, from the leading causes breakthroughs across the spectrum of of death, such as heart disease and cancer, to rare orphan indications, like Huntington’s and muscular dystrophy. 

More broadly, we also look for companies that focus on reining in the costs of healthcare. Annual US health expenditure is currently about $4.5 trillion or 17% of GDP, about one-quarter of which is considered waste. This includes problems such as improper diagnoses and treatment, administrative complexity, and other failures of care coordination. The companies we favor under this theme are those that work to improve the quality and sustainability of the healthcare system, including improved disease detection, home health services, and healthcare IT solutions.

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