Investing in health

Susannah Streeter: Hello, and welcome to Switch Your Money ON from Hargreaves Lansdown. I’m Susannah Streeter, I’m Head of Money and Markets here at Hargreaves Lansdown. And as usual I’m here with Sarah Coles, our Head of Personal Finance. So Sarah, how are you feeling?

Sarah Coles: Well fairly exhausted really from dealing with all the fall-out of the inflation and interest rate announcements that we had a couple of weeks ago, which I do know we’ll be touching on in a bit, but actually it’s funny how that question gets increasingly complicated after you hit the age of 40 because nothing works quite as well as it once did. In fact, that’s even more the case now because ill health has been increasing, and the number of people who are too sick to work has been growing.

Susannah Streeter: Yes, I mean it is a real nightmare for those struggling with their health, and also for employers. There are, however, a number of companies that are working to reverse these numbers and provide services for people facing health challenges, which do offer some hope. And it’s this area we’re going to be focusing on for the podcast, in an episode we’re calling ‘A Healthy Profit’.

Sarah Coles: Yes, we’ll be talking to Sophie Lund-Yates, our Lead Equity Analyst about the outlook for some of the companies operating here. So Sophie, you’re looking at quite a range aren’t you.

Sophie Lund-Yates: Yes, absolutely. I’m going to be looking at everything from virtual health services to a pharmaceutical giant and a medical services business.

Sarah Coles: We’ll also be having a quick chat to Helen Morrissey, Head of Pensions analysis at HL, who’ll be looking at the impact of health issues on older workers, but also at the one silver living if you suffer ill health in retirement.

Helen Morrissey: Yes, there are some real issues surrounding early retirement, but there is a small upside on offer from annuities.

Susannah Streeter: Really looking forward to hearing more about that later. Plus, we’ll speak to Dan Duffy, Senior Manager and Digital Health Scientist from Silver Cloud, a free mental health app, available on the NHS, using online cognitive behavioural therapy, to help people manage their mental health. So, Dan, this is a really interesting area, and must be something you’ve seen a big growth in demand for during these stressful times we’ve been seeing.

Dan Duffy: Of course, I mean even before Covid hit it was the case that digital was starting to grow exponentially year on year, but I guess after Covid, Covid did for the digital health intervention market what ten years couldn’t have done, yes people have been chomping at the bit.

Sarah Coles: Plus, Emma Wall will be talking to Jo Curtis, a Portfolio Manager at Janus Henderson Investors. But before we delve into physical health, we should touch on some recent developments in the health of the UK economy.

Susannah Streeter: Yes, at the latest check-up, conducted by the Bank of England, the economy shows fewer signs of heading for recession than it did, in fact the Bank is expecting a recession to be avoided this year, with slight growth now forecast in the second quarter of the year. The big question is will the bank continue to raise rates at its next meeting next month, or will it press the pause button after having hiked in March? Remember consumer prices are still hot hot hot, increasing to 10.4% in the year to February in the UK, so policymakers will be keeping a close eye on what the March numbers, out shortly, will tell them about whether Feb was a blip or whether inflation is super sticky. The turmoil in the banking sector is still a concern, and there are some expectations that it could have an impact on lending and could constrain growth. Overall, because of uncertainty about what may lie ahead for banks and the loans they make to customers and companies in the light of the volatility in the sector, there is an expectation that we are either at or at least very close to peak rates, both here in the UK and in the US. But Andrew Bailey, the Governor of the Bank of England, has made it clear in a recent speech that inflation is still very much a priority, and if there are clear signs of persistent inflationary pressures, monetary policy may have to be tightened again, so interest rates could still go up again but it’s all dependent on the data coming through.

Sarah Coles: Yes, it’s all about the data. But if you’re sick of thinking about interest rates, we can come back to health. So, the number of people who aren’t working because of ill health has been growing since the onset of the pandemic and has hit a record high. So, part of this is likely to be related to the pandemic itself, part to lifestyle changes during lockdowns, and part because of the backlogs that have developed in the NHS. So, the Office for National Statistics found that one in five adults are waiting for a hospital appointment, test or treatment through the NHS. Of those waiting for an appointment, one in five had been waiting for a year or longer. So, the epidemic of ill health hasn’t just hit those affected, but also those who care for them. So, half a million more women and 200,000 more men said they were carers in 2021/22 than a year earlier, and that takes the number of informal carers to an astonishing 4.9 million. So of course, juggling care with work is incredibly difficult, especially for the 16% of carers who are sandwich-caring, so they’re looking after both older family members and their own children. And as a result, an awful lot of them are dropping out of the workforce. So only a third work full time and just half work at all. So given that the most common age to be a carer is between 55 and 64, it’s a huge part of the reason why so many people of this age are dropping out of the workforce.

Susannah Streeter: And yes, Sarah, the backdrop to this is an NHS spending squeeze in the decade following the financial crisis of course. Spending on healthcare has historically grown around 4% a year, but during this period it grew 1.5% a year in real terms, so spending did not keep pace with demand. In the wake of the pandemic, a new settlement boosted spending, and budgets will now grow 2.9% in real terms. This is still behind the long-term average, but now mean still that the NHS accounts for 20% of all public spending and more than 40% of all day-to-day spending on public services. Within this, the NHS uses the services of some private companies. And this increased during Covid to boost capacity but remained at roughly 7% of NHS spending – or £12.2 billion.

Sarah Coles: In 2021, partly because of Covid restrictions, the for-profit sector delivered more hip and knee operations than the NHS for the first time in its history, while between 2016 and 2022, the percentage of cataract surgery provided by for-profit providers has risen from 11% to 46%. Then there’s the fact that LaingBuisson’s private healthcare self-pay report this time last year showed booming demand for people funding their own private care – both through private medical insurance and self-pay. And this wasn’t just focused on elective surgery, but also private GPs, diagnostics and consultants. It said that this could fall through the year as lockdown savings were spent, but that NHS waiting lists were likely to keep fuelling demand. Now there’s been an awful lot of innovation in the sector, particularly the growth of medical technology and digital solutions. The UK is home to the largest number of digital health start-ups founded in Europe between 2010 and 2020, so 182 companies were founded and funded between 2010 and 2022.

Susannah Streeter: There is also support from the government. The Spring Budget talked about boosting support for mental health and muscular skeletal problems, with new apps and digital solutions, which provide opportunities for the private sector. And it also announced measures to speed up approvals for new medicines, and a commitment to increase collaboration with global regulators which should support pharmaceutical companies bringing new medicines to UK patients.

Sarah Coles: So, what does all this mean for companies operating in the sector? Well, this feels like a good time to bring in Sophie Lund-Yates, our Lead Equity Analyst. So, Sophie, tell us who you’ve been looking at.

Sophie Lund-Yates: First of all, I’ve been looking at US-based Teladoc. So, as you might have guessed from the name, the company essentially offers virtual health services. So, one side of the business looks at global medical services across general medical, as well as expert and speciality medical. There’s also chronic condition management options and mental health products. So this is the so-called Integrated Care Services arm, which is offered on a business-to-business basis. The other side is the BetterHelp business which is a direct-to-consumer mental health platform. So, this area has over 30,000 licensed personnel who offer online counselling and therapy services. We all know that in recent years, awareness of and demand for mental health support has increased. So, this a long-term cultural shift in my opinion and demand should remain elevated. Now, at the same time, offering better virtual-medical services is also a good area to be in post-pandemic when patients and healthcare professionals are seeking better time efficiency in their day to day lives. Now, revenue last year was about $2.4bn, but the group isn’t making a profit. So operating losses were $13.7m. You know, getting younger companies like this off the ground is very expensive, and Teladoc’s also been increasing its marketing spending in quite a big way. I can’t deny that Teladoc has an exciting product in what should be a growing market. But we’d also always say companies without a proven track record of profit can be higher risk. So Teladoc shares change hands for 1.5 times its expected sales, which is some way below the average since the shares listed in 2015.

Susannah Streeter: And what about a company in the pharma sector, Sophie?

Sophie Lund-Yates: Yes, so given events of the last few years, we’re all aware of Moderna. So, it certainly makes a lot of sense to look at a pharmaceutical giant when we’re considering healthcare this week. Now there are some things to admire with pharmaceuticals. The main one is that there are very few that can do what the big names can, the barriers to entry are high because of the sky-high costs involved with research and development. So that helps protect market share. Then there’s the fact that selling crucial medication adds an element of resilience and visibility to revenues. Looking at Moderna specifically, there are some parts to consider. Now that Covid fatalities are fewer and public behaviour is getting back to normal, Moderna’s guidance numbers are being revised down because of the reducing demand for vaccines. Now revenue this year’s expected to be nearly $8bn, down from over $19bn. Now, this isn’t a surprise, but is worth consideration for those who think that Covid vaccines would still be a growth driver. So, an area of potentially more interest for Moderna is Oncology. So recent melanoma data from a study has been impressive, even though the study was small, so that’s something to keep in mind. Cancer vaccinations are a potentially exciting growth opportunity, though these aren’t guaranteed. One of the risks of pharma is that drugs take years to develop, and they may never make it through trials.

Sarah Coles: So, for your third company, you’ve stuck with the US again, haven’t you?

Sophie Lund-Yates: I have I’ve gone three for three on US names this week, with the final one being UnitedHealth Group. So, one side of this giant is known as UnitedHealthcare, which includes offering healthcare for 26.7m Americans, and this is across workplace plans and individuals, or there’s United Healthcare Global which provides dental and medical cover to overseas businesses and individuals. There’s also an arm that focuses specially on older adults and those that qualify for Medicare. Then there’s also Optum, which is more about the tech side of things and offers health management solutions, data insight and analytics and pharmaceutical services to name a few. The group’s scale and the importance of what it offers has fed into impressive profit growth in the last few years. Of course, past performance isn’t a guide to the future, so keep that in mind. It’s also not afraid of making mergers and acquisitions to bolster its position, so its £1.2bn takeover of UK-listed EMIS is expected to complete this year. EMIS’s systems are actually widely used across the NHS. Now these fundamental strengths are reflected in a price to earnings ratio of 18.5. Which is slightly higher than the ten-year average.

Susannah Streeter: OK Sophie, thank you very much, plenty of companies to keep an eye on in this sector. And earlier we did mention the technological innovations and private companies working with the NHS. So, let’s focus in on that and speak to a company that has been part of the digital healthcare transformation, Silver Cloud, and Dan is back to tell us more about it, so Dan can you explain exactly what the app does?

Dan Duffy: Of course, so Silver Cloud is an internet delivered cognitive behavioural therapy intervention, so what that basically means is that it’s the adaptation of a CBT or cognitive behavioural therapy protocol to an online format to treat a range of different disorders, like depression, any of the anxieties like generalised anxiety disorder. We’re also not just about CBT. We also incorporate tools from mindfulness and positive psychology approaches. Silver Cloud can also be used with or without support from a clinician within a healthcare service, but we know that users who have support from a clinician tend to do a bit better, so when you think about how Silver Cloud is sold, I guess it’s typically business-to-business or B2B, so it’s not direct to consumer. In most circumstances users are patients who access Silver Cloud, get to Silver Cloud either through a referral from their GP or in some areas you can self-refer to an NHS mental health service, like the improving access to psychological therapies services which treat a range of different disorders on the mild to moderate to moderate to severe range, or through an EAP programme in the workplace, or even through some charities we offer services through as well. Silver Cloud is built on the idea of mental healthcare in your own time, so you meet with a clinician once a week either over the telephone, through videoconferencing or asynchronous messaging, where contact doesn’t happen at the same time but your clinician reviews you at a set time every week. The clinician can see the user’s progress through the app, the intervention can also be used through a browser through a website and then each week the client is reviewed, and the clinician in that circumstance acts like a motivational or a therapeutic cheerleader as I like to call it, where they encourage the user to interact with the programme content, to respond to any of the questionnaires that are presented on the programme, also read all the articles that we are posting through psycho-educational content.

Sarah Coles: So, you’ve mentioned that you’re working with the NHS and GPs, so how easy is it as a business to be working with the NHS.

Dan Duffy: We’ve really had to graft, so Silver Cloud has been working with the NHS since about maybe 2012/ 2013, and it really was a partnership, so we started working with one specific service in London and we started developing content that they needed, that they saw that there was a need for digital interventions because they have mandated access targets and people talk about the tsunami of mental health that was coming from Covid but it was really always there. Mental health services were always inundated with referrals, and internet delivered interventions like Silver Cloud are a really useful tool to extend the capacity of your clinician workforce. So, we partnered with one service in the UK, and we started building interventions that were NICE accredited, so the National Institute of Clinical Healthcare and Excellence, so they would develop the guidelines for treating common mental health disorders in the UK. We developed our content with that service based on the guidelines for treating anxiety, depression, so through that I guess it’s like anything, word of mouth got out. We have a whole multi-disciplinary team within the company, sales, marketing, commercial, so from there it built and built and built, but it hasn’t been an easy road, because it’s not just about building the interventions. It’s about making sure your interventions are also evidence-based, so when I say evidence-based, it’s about having a team of researchers who are able to sort of, of course when it comes to commercial interests it’s never truly independent, but that’s what the researchers are hired for, and that’s my role too, so it’s about building an evidence knowledge base around programmes so conducting research trials on whether or not these interventions truly work in planned pathways, how they were planned to be used. But you can see with the way the NHS healthcare market is moving, they’re talking about stuff like digital enabled therapies, digital enabled therapies assessment criteria, and even NICE are even moving towards an early evaluation protocol for whether or not interventions like Silver Cloud, of which there many on the market, can be recommended by the healthcare system to be used within services, so the market is really moving in that direction now, about having an evidence base and making sure the interventions are fit for purpose for the populations they’re serving.

Susannah Streeter: When you talk about the direction the NHS is moving in, there will be plenty of people who are really concerned that this is part of the privatisation of the NHS.

Dan Duffy: Of course, and I suppose in a way the NHS has moved in that direction and that was kind of reflected in the health and social care bill that was passed in 2012 that allowed for private venders to get involved with the NHS market and there are lots of even mental health services now that are put out to bidders or private companies to run the whole services so in that regard it’s not necessarily uncommon for private entities to work within the NHS, but without getting into all of that conversation, you know our product is a specialised resource that therapists can use in the treatment of individuals so in a lot of ways it’s really no different to, for example, a surgeon buying a scalpel or neuroscientists in hospital using MRI scanners or buying MRI scanners to treat their patients.

Sarah Coles: As a sort of fast-moving technological company, working sort of hand in hand with a very large, quite clunky organisation that has sort of got political links that does mean the rules change relatively regularly. Is that something that you’ve had to adapt to. I mean obviously you say you have been working with the NHS for a long time, so is that something that you’re accustomed to now?

Dan Duffy: Yes, healthcare no matter where you go is messy and I suppose the way we’ve worked with the NHS, it’s really been in a partnership. We developed our initial programmes in collaboration with NHS services. We pilot the programmes within NHS services, so it’s not the case of we think it would be a good idea because based on an overall market need we need a programme, for example, I don’t know, a specific anxiety disorder. So we speak to services, they tell us their needs and they tell us the issues that they’re currently facing, and we build the intervention based on that need. So, in regard to slotting in, we’ve already got an idea I guess of what we’re going into, but of course it’s never as simple as that. We conduct a number of product pilots whenever a new intervention is built and that’s where you start realising that no the content isn’t actually purposeful for this population so we need to change it, or no the referral pathway doesn’t work or the patient pathway in general doesn’t work for a digital intervention in this regard, so we may have to shift focus, and then I guess one of my key research interest areas is implementation science and that relates to the whole idea of implementing the appropriate intervention in the correct way so it gets into the clients' hands or a patients' hands in the most efficient way possible, so we do a lot of implementation work in regards to stakeholder consultation, understanding that there are stakeholders at all level of organisation that can exert influence, because it’s not just about having people at that leadership level who can navigate the bureaucracy that is NHS services, but also the day to day clinician on the ground and how that individual can be influential or impactful in regards to other clinicians using the intervention, and as well also understanding that clinician attitudes and their thoughts towards digital CBT can also impact on their patients and how the patients receive the intervention too. So, there’s a lot of work that needs to be done, one to develop a digital intervention like Silver Cloud but also to make sure that services are using it in the most appropriate way. We know that time is a massive factor as well. It takes a minimum of maybe 4-6 months before you start seeing any decent outcomes with any sort of healthcare or technological innovation that goes into a service.

Susannah Streeter: So, have you been disappointed with the take-up so far?

Dan Duffy: Oh gosh, no. Last August, we celebrated 1 million users and before that I remember maybe 2 years previous celebrating half a million users. I think we’re up around the 1.2, 1.3 mark now. The take-up has been massive. It always has been, and I suppose the more the NHS develops when it comes to access targets and finding ways to get creative with getting people into services. That’s when services really start seeing digital as a tool to facilitate them in accessing the populations that they’re mandated to access.

Sarah Coles: Do you see more developments in the pipeline? Where so you think things will go from here?

Dan Duffy: Oh gosh, yes, so we’re primarily used at the mild to moderate level in NHS improving access to psychological therapy services and we’re primarily used over the telephone, but of course as with everything Covid changed how mental healthcare is done, so we’re currently developing new initiatives based on a synchronous use case for Silver Cloud, which is, at the same time, a clinician and a client using the intervention together, so the use case behind that was that when services were forced to go completely online, there were a whole bunch of face-to-face services that ceased operating. So, those clinicians were forced to use a whole bunch of different programmes to be able to interact with and track their clients appropriately. Like they had to get creative on Zoom. They needed to use PowerPoint, they needed to use Word to illustrate therapeutic concepts, so I guess right now we’re moving in that direction and piloting in that direction, with our tools for therapy initiative, and there will definitely be more coming out on that soon from the company.

Susannah Streeter: Dan, really fascinating stuff, and it’ll be really interesting to see how you continue to develop with your partnership with the NHS in the UK.

Dan Duffy: Thank you so much, and thanks for having me.

Sarah Coles: So, we’ve looked at the opportunities for companies, but there are real challenges posed by the ill-health epidemic. So we have Helen Morrissey, Head of Pensions Analysis, with us now, to look a bit closer at this side of the coin, so Helen, the recent Budget contained measures aimed at getting people, particularly older people back into work. Why is the government so focused on this?

Helen Morrissey: Yes, it’s a really big issue. We saw a lot of people leave the workforce during the pandemic, and while younger people have typically since returned to work, a lot of older people haven’t. The government is keen to encourage them to do so. And this is why we saw changes to pension rules to make this easier in the Budget. But if we are going to tempt older people back, we will also need to look at making work more flexible for older workers.

Sarah Coles: Do you think, even with all of this, we will see older workers return in any meaningful way?

Helen Morrissey: It’s a tricky one. I think there are a lot of people who are happily retired, or who left work on the basis of ill health, so it’s more of a challenge to get them to return to the workforce. However, some retired people will have been caught out by soaring costs, so they need to return to work and rebuild their pension. It’s also worth saying that longer term we could see people working longer, as the state pension age increases. Because many people simply can’t afford to retire until they start receiving it.

Susannah Streeter: What is the state pension age currently, and where is it heading?

Helen Morrissey: State pension age is currently 66 and it’s due to go up to age 67 between 2026-2028. It’s currently due to rise to age 68 by the mid-2040s but there’s an ongoing review and until recently the government was looking to bring this forward. It’s a tricky balancing act though. The cost of providing the state pension is eye wateringly high, but the ability to keep working until age 68 will be beyond many people as their health deteriorates. Initially, it looked like a certainty the government would accelerate this change, but for now it has decided to shelve it, as increases in longevity have slowed.

Sarah Coles: So, the state of your health can cause real issues for retirement planning, but disclosing health conditions can actually help you get a higher income in retirement, is that right?

Helen Morrissey: It certainly does. If you suffer from a condition such as high cholesterol or diabetes, then you could qualify for an enhanced annuity which will give you a higher income than a standard annuity would, so it’s really important to disclose any conditions you may have when getting annuity quotes. Even lifestyle conditions such as how much you weigh, whether you smoke, or how much you drink can make a difference.

Susannah Streeter: Thanks Helen, it’s good to hear there’s one way in which health issues don’t work against us. Now I’d like to bring in Emma Wall, our Head of Investment Analysis and research here at Hargreaves Lansdown. She’s been speaking to Job Curtis, portfolio manager at Janus Henderson Investors.

Emma Wall: Hello Job.

Job Curtis: Hello.

Emma Wall: So, we’re here today to talk about healthcare and pharmaceutical companies, a number of which feature in your portfolio, which is a fund invested for long term income. I thought first we would talk about why these types of companies, or this sector, is good for income.

Job Curtis: Thank you Emma it is a good sector for income, and the reason being that they’re very defensive companies, you know, healthcare spending carries on regardless of the whether you know you’re in an economic downturn, so while cyclical companies in an economic downturn there might be pressure on their profits and on their dividends, these companies often they’re funded by state governments or by private health insurance. So these companies have very stable profits and the whole thing of these companies is to really discover new medicines, and they do achieve that and they pass the regulators they do have a patent protection for a number of years and the pricing in America, in particular, which is by far the most important market, does reward companies for genuinely innovative new medicines and so you have a sort of number of years of very good profitability regardless of the economic climate, so this is a defensive sector, good cash flows. The key though is that they have to discover new medicines, because eventually existing medicines come off patent. If they can’t discover new medicines then the companies go backwards.

Emma Wall: Absolutely, and I should say though nothing is guaranteed, but potentially these sorts of companies are the ones you should be looking for at the moment with so much economic uncertainty around. I thought though that we could delve into some specifics. I know you have a number in the portfolio. I don’t know if you just want to start by highlighting one that you’re investing in currently.

Job Curtis: I’m a generalist fund manager and income specialist as you were saying, and you do rely to an extent on analysts, people who’ve got a scientific background, because it is about kind of medicines, and we have at Janus Henderson analysts who come from a scientific or medical background, who really understand the pipeline, so you know one relies on their advice and also analysts at the investment banks as well and read their research, and certainly the British company that you know that has really done well in recent years has been AstraZeneca which the public may know through its vaccine during Covid, but actually vaccines is a very small business for AstraZeneca. Their main business is discovering medicine. They’ve been particularly successful in the cancer field in recent years, but it’s actually quite expensively rated, it is actually on a relatively low dividend yield. So you know my strategy is to actually have a spread of pharmaceutical companies. We’ve actually got six altogether, so in addition to AstraZeneca we have GlaxoSmithKline, and four overseas listed - we’re allowed to have up to 20% overseas listed. And as a kind of conservative fund I prefer to play the sector in this way in order to sort of spread the risk.

Emma Wall: Perhaps we could pick up on one of those overseas companies then that’s in the portfolio. I think it’s particularly interesting to look at the breadth within the healthcare space because typically people do think of vaccine producers, of pure pharmaceuticals but, actually, it can include sort of wider healthcare as well can’t it.

Job Curtis: That’s absolutely right and there are some conglomerates within the sector. Probably the most famous is Johnson and Johnson in America and it’s 70% pharmaceuticals, but it’s also 20% medical devices and 10% consumer healthcare, but actually the trend in the sector has been to specialise more, and Johnson and Johnson have announced that they will be floating off their consumer healthcare division, which is actually a move that GlaxoSmithKline made last year in order to kind of focus more on the pharmaceutical side, so the trend has been away from conglomerates, but there are other sides to healthcare. There’s also animal healthcare as well and there’s hospital management which we don’t have much exposure to in the UK stock market, but I think the real high profit margins comes from the pharmaceutical side and you know one stock that’s been very good for us has been Merck in the US, which has been the leader really in the immunotherapy area of cancer which is helping your immune system fight cancer and they’ve got an absolute blockbuster drug called Keytruda, now selling at $20 billion a year and that’s made a real difference, it’s sort of saving lives and extending lives and so that’s been a huge product for Merck and actually Merck does pay a decent dividend.

Emma Wall: And how reliant on, I don’t want to be flippant but, the whim of the regulator are you in this space, because it is, rightly so, a highly regulated industry and a different regulatory body overseeing the US versus the UK or Europe.

Job Curtis: Yes, I mean that’s a very good question. I think it’s really important we do have this regulation. If you go back into the late 1950s in this country there’s a drug called Thalidomide given to pregnant women and it hadn’t been properly tested and there wasn’t proper regulation, and it was a disaster. America did have proper regulation in that period. I think this is why the drug companies, pharmaceutical companies, can spend huge sums of money developing a drug but it can fail at the very last stage because the regulators can look at it and they’ve obviously got to be sure that it’s absolutely 100% safe, so it is a key risk in the business. I would say the other risk certainly is also being sued and in America that’s the other side really of the American system is that the company, rightly, if they’ve been covering up medicines they’ve been selling with bad side effects then they can get sued for huge sums in the US courts and the kind of progression of those court cases can cause quite a lot of disturbance to share prices.

Emma Wall: Presumably your preference for kind of quality names is a risk mitigation in all that, although nothing is guaranteed.

Job Curtis: Nothing is guaranteed and you know I think sometimes these companies, because they are strong sort of financial companies, they are targets for unscrupulous lawyers, but obviously they’re very justified to be sued in some situations, but in other situations people may be hoping to win a big fee off them, so I think it is part of the parcel going with this sector. But it does mean you need to be in the quality companies and you know going back to the dividend situation, I mean GlaxoSmithKline had to cut its dividend recently and that really is, unlike AstraZeneca, they hadn’t been so successful bringing new medicines to market in recent years and they’ve actually just spun out, as I’ve mentioned, their healthcare business, into a new company called Haleon and in the process they’ve also reduced their dividend, so that’s an example that although the sector has defensive qualities, if the companies don’t discover the new medicines, in the end the kind of profits decline and they’re unable to support their dividends.

Emma Wall: Job, thank you very much.

Job Curtis: Pleasure.

Susannah Streeter: Well, that was Emma Wall, speaking to Job Curtis from Janus Henderson Investors, and please bear in mind these are the views of the fund manager and are not individual stock recommendations. You’re listening to Switch Your Money ON from Hargreaves Lansdown. And now it’s time for the stat of the week. And we’re going to stick with health, in fact the number of GPs. So, Sarah, there’s an awful lot of talk of how hard it is to get a GP appointment, so this stat is about how many GPs we have in the NHS. Do you want to guess?

Sarah Coles: Well, you did give me some warning on this, so I have had a think about it, but it’s just so hard to tell, so I think it’s probably more than about 25,000, but I’ve no idea really.

Susannah Streeter: It is a bit more than 25,000, in fact it’s just over 36,500. However, they don’t all work full time, so it actually equates to 27,300 full time GPs, so you really weren’t far off. According to the British Medical Association, that figure hasn’t changed much since 2015. It’s actually fallen slightly, so given the growth in the population, you can see how they’re being really stretched right now.

Sarah Coles: Yes, it certainly explains why appointments are like gold dust around here.

Susannah Streeter: That’s all from us this time, but before we go, we do need to remind you that this was recorded on 3 April 2023, and all information was correct at the time of recording.

Sarah Coles: Nothing in this podcast is personal advice. You should seek advice if you’re not sure what’s right for you. Unlike the security offered by cash, investments rise and fall in value, so you could get back less than you invest.

Susannah Streeter: Yes, this is not advice or a recommendation to buy, sell or hold any investment. No view is given on the present or future value or price of any investment, and investors should form their own view on any proposed investment.

Sarah Coles: And this hasn’t been prepared in accordance with legal requirements designed to promote the independence of investment research and is considered a marketing communication.

Susannah Streeter: Non-independent research is not subject to FCA rules prohibiting dealing ahead of research, however, HL has put controls in place (including dealing restrictions, physical and information barriers) to manage potential conflicts of interest presented by such dealing.

Sarah Coles: You can see our full non-independent research disclosure on our website for more information. So all that’s left is for me to thank our guests, Dan, Job, Sophie, Helen, Emma and our producer Elizabeth Hotson.

Susannah Streeter: Thank you so much for listening. We’ll be back again soon, goodbye.