AI moves from narrative to measurable productivity in the healthcare sector

AI moves from narrative to measurable productivity in the healthcare sector
The TD Cowen 46th Annual Healthcare Conference in Boston once again demonstrated why it remains one of the most important global forums for healthcare investors. With hundreds of presenting companies and an intense schedule of KOL panels, management presentations and investor discussions, the conference provided a comprehensive pulse check across the sector. Bellevue Asset Management was strongly represented throughout the week, with Portfolio Manager Dr. Terence McManus and biopharma analysts Guy Bettschart and Dr. Markus Schweiger actively engaging management teams to assess how key structural themes are translating into operational momentum.

The conference underscored an industry moving from uncertainty to acceleration. AI is delivering tangible productivity gains and driving structural efficiency. The renal segment is emerging as a strategically important therapy area with increasing class momentum. And several of our key holdings demonstrated operational strength and long-duration growth visibility.

While macro and policy dynamics remain fluid, the innovation cycle across these themes appears intact – and with the help of AI is clearly accelerating.

AI: Biopharmaceutical companies could be a beneficiary
We were surprised at how biopharmaceutical management teams were proactive in addressing the AI thematic. AI was not discussed as a future aspiration – it is already reshaping workflow. The companies we spoke to were aligned that the most impactful application today is accelerating clinical trials and improving efficiency across workflows, but that the longer-term opportunity is in improving drug design and reducing attrition rates in clinical trials.

One large European pharmaceutical company R&D executive quantified the change, citing a 30% increase in productivity from program start to candidate selection. AI is embedded in chemistry and translational workflows, shortening lead optimization cycles and improving candidate quality.

Productivity gains from AI and automation are becoming embedded in cost structures. The CEO of a large US pharmaceutical company framing the shift in structural terms, stating he expects a 20%–25% reduction in headcount loss over the next few years.

The tone across discussions suggested that AI is now a margin tailwind and a competitiveness factor. It is accelerating decision-making, compressing timelines and raising the bar for operational excellence across large pharma.

Catching up with key holdings in the Global Healthcare Funds
Several of our core holdings delivered constructive updates and reinforced conviction.

Vertex highlighted meaningful pipeline depth beyond cystic fibrosis, with kidney disease emerging as a conference theme. Management remains confident in povetacicept (Pove) in IgAN, noting that a ca. 47% UPCR reduction would be a strong outcome, while emphasizing that long-term eGFR preservation is what ultimately matters in renal medicine. Vertex is increasingly positioning itself as a multi-asset renal franchise builder rather than a single-product story, supported by a long patent runway and a diversified late-stage pipeline.

Madrigal delivered one of the most confident updates of the week, highlighting IP protection for Rezdiffra out to 2045 and modest penetration of only ca. 12% of the initial addressable population. With steady patient adds expected through 2026, management views profitability as inevitable as scale builds.

Amgen reinforced the durability of its cardiometabolic and rare disease franchises. Repatha remains underpenetrated in a large LDL-C population not at goal, while biosimilars and resumed buybacks add to the defensive compounder profile following deleveraging.

UCB remains confident in Bimzelx growth despite pricing headwinds into 2026, expecting volume to offset step-downs. The upcoming BE BOLD study serves as a near-term catalyst, with management signaling sustained share gains in a competitive immunology market.