Themes in the transition

Impax’s Sector Expert Groups assess sustainability-related opportunities and risks across healthcare using its proprietary Sustainability Lens Framework. The framework evaluates healthcare sub-industries against opportunities including healthcare access, innovation, wellbeing and resource efficiency, alongside risks such as regulation, product liabilities and pollution.

The transition today: What we’re watching across sectors

Impax highlights AI disruption, tighter emissions regulation and affordability pressures as major cross-sector themes. Nearly 75% of S&P 500 CEOs consider AI financially material, though fewer believe they are prepared for associated risks. The report stresses the importance of AI governance, cultural readiness and monitoring investment returns.

European carbon regulation is tightening through the phase-out of free EU ETS allowances and implementation of the Carbon Border Adjustment Mechanism. In the US, residential electricity bills increased 27% between 2019 and 2025, increasing scrutiny of utility pricing and infrastructure investment.

Sector in focus: Healthcare

Healthcare is positioned to benefit from preventative care, AI-enabled diagnostics and productivity-enhancing technologies that improve efficiency and reduce workforce pressures. Hospitals account for around one-third of US healthcare expenditure, creating opportunities for operational savings.

Risks include anti-trust scrutiny, product liability and environmental regulation. The revised EU Urban Wastewater Treatment Directive will require pharmaceutical companies to fund at least 80% of advanced wastewater treatment costs, increasing compliance obligations.

Themes in focus: Healthcare

Healthcare spending represents around 10% of GDP across the OECD and 17% in the US, while the World Health Organization estimates an 11 million healthcare worker shortfall by 2030. AI applications are improving scheduling, supply chain management and clinical documentation, while robotic-assisted surgery and AI-enabled diagnostics are improving consistency and reducing complications.

Drug development costs have increased from roughly US$1.3 billion to US$2.2 billion over the past decade, making AI-driven efficiencies increasingly important. The report also notes that the One Big Beautiful Bill Act reduces Medicaid eligibility by 10%, affecting 7.8 million enrolments, potentially pressuring hospitals and nursing facilities.

Sub-industry in focus: Healthcare equipment

Healthcare equipment providers are benefiting from demand for AI-enabled systems that improve workflows and treatment precision. Global robotics penetration remains below 15%, with Intuitive Surgical maintaining leadership in robotic-assisted surgery. Siemens Healthineers is identified as a leader in AI-enabled imaging technologies.

The report highlights rising legal and reputational risks associated with AI-assisted medical devices and recommends strong governance, patient safety controls and AI model validation frameworks.

Sub-industry in focus: Life sciences

Onshoring pharmaceutical manufacturing is expected to support a multi-year capital expenditure cycle between 2027 and 2030, with planned US investment reaching approximately US$500 billion. AI-driven drug discovery may also shorten pre-clinical development timelines from six years to as little as 18–24 months.

Sub-industry in focus: Managed health care

Managed care organisations may benefit from AI-driven improvements in pricing, claims processing and medical loss ratio management. However, political scrutiny remains elevated due to rising healthcare costs and dissatisfaction with the US healthcare system. Proposed flat Medicare Advantage rates for 2027 may pressure earnings, although major structural reform is considered unlikely.