The Toronto Stock Exchange (TSX) is emerging as a Global HealthTech Hub in 2025

Exec Summary

The Toronto Stock Exchange (TSX) and its subsidiary, the TSX Venture Exchange (TSXV), have emerged as a compelling market for healthcare technology companies due to several structural, economic, and market-specific factors.

Below are the key reasons why the TSX is an interesting and growing market for healthcare technology, supported by relevant insights and critical analysis:

1. Access to Capital for Emerging Companies

TSX and TSXV Structure: The TSX is Canada’s premier exchange for senior equities, while the TSXV is tailored for early-stage and emerging companies, including those in healthcare technology. The TSXV’s lenient listing requirements (e.g., lower market cap and financial thresholds compared to the TSX) make it accessible for innovative healthcare tech startups to raise capital.

Equity Financing: In 2023, TSX and TSXV collectively raised $21.5 billion in equity capital, demonstrating robust investor interest. Healthcare tech companies, often requiring significant R&D funding, benefit from this liquidity to fuel innovation.

Unlike larger exchanges like NASDAQ, the TSXV offers a less competitive environment for smaller firms, enabling healthcare tech companies to gain visibility and attract investment without the intense scrutiny of U.S. markets.

2. Growing Healthcare Sector Performance

Sector Resilience: The TSX healthcare sector has shown resilience amid market volatility. For instance, in March 2024, healthcare stocks on the TSX rose 3%, driven by companies like Bausch Health Companies, which gained nearly 4%. This stability attracts investors seeking defensive sectors during economic uncertainty.

Key Players: Companies like WELL Health Technologies Corp., listed on the TSX, are leading in telehealth and digital health solutions, capitalising on the global shift toward virtual care. Their presence highlights the TSX’s role as a hub for innovative healthcare tech firms.

While the TSX healthcare sector is smaller than that of U.S. exchanges, its growth trajectory reflects increasing investor confidence in Canadian healthcare tech, particularly in areas like telemedicine and AI-driven diagnostics.

3. Supportive Canadian Innovation Ecosystem

Government and R&D Support: Canada’s government offers tax incentives, grants, and programs like the Scientific Research and Experimental Development (SR&ED) tax credit, which support healthcare tech R&D. This reduces financial burdens for startups listing on the TSX or TSXV.

SME-Driven Economy: Small and medium-sized enterprises (SMEs), including healthcare tech startups, account for 88.3% of Canada’s private labor force and over 50% of GDP. The TSX and TSXV cater to these SMEs, fostering innovation and job creation.

The TSX’s focus on SMEs aligns with the entrepreneurial nature of healthcare tech, where smaller firms often drive disruptive innovations like wearable devices or health AI platforms.

4. Global Reach and International Listings

Interlisted Companies: The TSX supports interlisted securities, allowing healthcare tech companies to attract both Canadian and international investors. As of January 2024, the TSX had 1,811 listed issuers with a combined market cap of CAD $4.16 trillion, including international firms.

Global Investor Base: The TSX’s reputation as a leading global exchange (10th largest worldwide) enhances its appeal for healthcare tech companies seeking cross-border investment.

While the TSX’s global reach is a strength, it faces competition from U.S. exchanges like NASDAQ, which dominate healthcare tech listings. However, the TSX’s lower listing costs and supportive ecosystem make it a viable alternative for smaller firms.

5. Advanced Trading Technology

Electronic Trading and Quantum XA: The TSX’s fully electronic trading platform, powered by the TMX Quantum XA engine, ensures high-speed, reliable trading. This infrastructure supports healthcare tech companies by providing liquidity and transparency for investors.

Innovative Market Mechanisms: Features like AlphaX and Alpha DRK reduce adverse selection and enhance execution quality, making the TSX attractive for institutional investors interested in healthcare tech.

Efficient trading systems lower transaction costs and improve market access, critical for healthcare tech firms with volatile stock performance due to R&D cycles.

6. Diverse Sector Representation

Healthcare Tech Niche: The TSX hosts a diverse range of sectors, including healthcare, which is gaining traction. Companies like ChitogenX Inc. (biotech) and Light AI Inc. (AI-driven health solutions) exemplify the TSX’s growing healthcare tech portfolio.

Complementary Sectors: The TSX’s strength in technology and finance sectors supports healthcare tech firms, as these industries often converge in areas like health fintech or AI diagnostics.

The TSX’s healthcare sector is less dominant than its energy or mining sectors, but its growth reflects increasing diversification, making it a hotspot for niche healthcare tech investments.

7. Market Stability Amid Global Challenges

Resilience to Volatility: Despite a 3.8% drop in the S&P/TSX Composite Index in April 2025 due to U.S. tariff concerns, healthcare and consumer staples sectors showed resilience, suggesting investor preference for stable sectors during uncertainty.

Historical Stability: The TSX weathered the 1929 crash without defaults and has a track record of stability, appealing to risk-averse investors in healthcare tech.

Healthcare tech companies, often seen as defensive investments, benefit from the TSX’s stability, especially during global trade tensions or economic downturns.

8. Investor Appetite for Innovation

Venture Capital Synergy: The TSXV’s focus on junior companies aligns with venture capital trends in healthcare tech, where investors seek high-growth opportunities in areas like precision medicine or digital therapeutics.

Public Market Access: The TSX and TSXV provide a pathway for healthcare tech startups to transition from private funding to public markets, as seen with companies like WELL Health Technologies.

While investor interest is growing, the TSX must compete with U.S. markets, where healthcare tech IPOs often attract larger valuations. Canada’s supportive policies help bridge this gap.

Challenges and Considerations

Competition with U.S. Exchanges: NASDAQ’s dominance in healthcare tech listings (e.g., companies like Moderna or Teladoc) poses a challenge. The TSX’s smaller scale may limit its appeal for mega-cap firms.
Market Volatility: Recent TSX declines (e.g., 870 points in April 2025) due to trade tensions highlight risks for healthcare tech stocks, though the sector’s defensive nature mitigates some impact.
Smaller Sector Size: The TSX’s healthcare sector is smaller than its energy or finance sectors, but its growth rate suggests untapped potential.

The TSX is an interesting and growing market for healthcare technology due to its accessible capital markets, supportive innovation ecosystem, advanced trading infrastructure, and resilience amid global challenges. The TSXV’s focus on early-stage firms, combined with the TSX’s global reach and sector diversification, makes it a compelling platform for healthcare tech companies. While it faces competition from U.S. exchanges, the TSX’s lower costs, stability, and alignment with Canada’s SME-driven economy position it as a hotspot for investors and innovators in healthcare technology.

Nelson Advisors > HealthTech M&A

Nelson Advisors specialise in mergers, acquisitions and partnerships for Digital Health, HealthTech, Health IT, Healthcare Cybersecurity, Healthcare AI companies based in the UK, Europe and North America. www.nelsonadvisors.co.uk

We work with our clients to assess whether they should 'Build, Buy, Partner or Sell' in order to maximise shareholder value and investment returns. Email lloyd@nelsonadvisors.co.uk

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Examples of successful healthcare technology companies listed on the Toronto Stock Exchange (TSX)

Here are some examples of successful healthcare technology companies listed on the Toronto Stock Exchange (TSX), based on their market performance, innovation, and recognition in the sector:

1. WELL Health Technologies Corp. (TSX: WELL)

WELL Health is a significant player in the Canadian digital health space. It operates the largest outpatient clinic network in Canada and provides a comprehensive suite of digital health services, including telehealth, electronic medical records (EMR), and virtual care solutions. Their focus is on empowering doctors and improving patient outcomes through technology.

Significant market capitalisation (around CAD $1 Billion as of April 2025).
Strong revenue growth, driven by both organic expansion and strategic acquisitions.
A large network of clinics and a growing digital platform with a substantial number of healthcare providers and patient interactions.
Recognised as a leader in the digital transformation of healthcare in Canada.

2. dentalcorp Holdings Ltd. (TSX: DNTL)

dentalcorp is Canada's largest network of dental practices. While not purely a "technology" company in the startup sense, they heavily leverage technology to enhance practice management, patient experience, and operational efficiency across their extensive network. This includes digital record-keeping, imaging technologies, and patient communication platforms.

Substantial market capitalisation (over CAD 1.5 Billion as of April 2025).
A vast and growing network of dental practices across Canada.
Demonstrated ability to integrate technology to improve service delivery within the dental sector.
Consistent revenue generation from a stable and essential service.

3. VitalHub Corp. (TSX: VHI)

VitalHub develops and supports mission-critical healthcare information systems for hospitals, long-term care facilities, home health agencies, and mental health organisations. Their solutions focus on areas like patient flow management, electronic health records, and data analytics, aiming to improve efficiency and patient care.

Significant growth in market capitalisation over the past few years (reaching over CAD $500 Million
Strong year-over-year revenue growth, driven by increasing adoption of their digital health solutions.
A Software-as-a-Service (SaaS) revenue model, providing recurring and predictable income.
Expansion of their customer base across various healthcare segments.

4. Extendicare Inc. (TSX: EXE)

Extendicare is a leading provider of senior care services across Canada. While their primary business is care homes and retirement living, they are increasingly incorporating technology to enhance resident care, safety, and operational efficiency. This includes electronic health records, monitoring systems, and communication tools.

Large market capitalisation (over CAD 1 Billion as of April 2025).
A well-established presence in the long-term care sector, benefiting from Canada's aging population.
Consistent revenue generation and cash flow.
Growing adoption of technology within their facilities to improve care delivery.

Other Notable Companies (with varying degrees of "pure" HealthTech focus):

Andlauer Healthcare Group Inc. (TSX: AND): Specializes in healthcare supply chain management and logistics, relying on technology for efficient operations.
Bausch Health Companies Inc. (TSX: BHC): A large pharmaceutical and medical device company that incorporates technology in its product development and delivery.
Jamieson Wellness Inc. (TSX: JWEL): A manufacturer and distributor of natural health products, utilizing technology in its supply chain and marketing.

Key Takeaways:

The TSX is attracting a diverse range of companies that are leveraging technology within the healthcare sector.
Success can be seen in companies focusing on digital health platforms, healthcare IT solutions, and the application of technology to improve traditional healthcare services.
Market capitalisation and revenue growth are key indicators of the financial success of these companies.
The increasing focus on digital transformation within the Canadian healthcare system provides a favourable environment for HealthTech companies listed on the TSX.

Key Trends Driving Healthcare Technology Success for companies listed on the TSX

Digital Transformation and Telemedicine Growth:
- The adoption of digital health solutions, such as telemedicine and electronic medical records (EMR), continues to accelerate in Canada and globally. This is driven by the need for cost-efficient healthcare delivery and improved patient access, particularly in underserved regions.
- Government support for healthcare digitisation, including investments in interoperable health systems, is expected to bolster companies offering tech-driven solutions.
Aging Population and Accessibility Needs:
- Canada’s aging demographic is increasing demand for mobility and accessibility solutions, such as stairlifts and wheelchair lifts, as well as home healthcare technologies.
- Companies addressing these needs are well-positioned for steady growth, especially with rising healthcare spending projected to reach CAD 344 billion by 2027.
Supply Chain and Logistics Resilience:
- Healthcare logistics, critical for pharmaceuticals and medical devices, remains a stable growth area due to consistent demand and the need for reliable cold-chain solutions.
- Companies in this space benefit from long-term contracts and regulatory-driven demand, providing predictable revenue streams.
Analyst Optimism for Healthcare:
- Analysts project a 48% annual earnings growth for the TSX healthcare sector over the next five years, significantly outperforming historical declines of 34% annually. This optimism stems from innovation and recovering valuations.

Outlook for Specific Companies

WELL Health Technologies Corp. (TSX: WELL)

WELL Health is a leader in telemedicine and EMR, with a 27% revenue increase in Q3 2024 (CAD 251.7 million) and a 42.84% stock price gain over the past year. Its network of over 2,100 providers and 4.6 million annualised patient visits positions it as a dominant player in digital health.

WELL’s acquisition strategy, including U.S. expansion and AI-driven healthcare tools, is expected to drive revenue growth. The global telemedicine market is projected to grow at a CAGR of 18.7% through 2027, and WELL’s scalable platform aligns with this trend.

High acquisition costs could strain margins if integration falters. Competition from U.S.-based telehealth giants like Teladoc may pressure market share.

WELL is likely to maintain strong growth, with analysts forecasting 20–30% annual revenue increases through 2027, supported by organic growth and strategic acquisitions. Its stock could see further upside if it sustains profitability and expands internationally.
Andlauer Healthcare Group Inc. (TSX: AND)

Andlauer’s focus on healthcare logistics, particularly temperature-controlled transport, ensures stable cash flows. Its essential role in pharmaceutical distribution, especially for vaccines and biologics, shields it from economic volatility.

The global healthcare logistics market is expected to grow at a CAGR of 7.5% through 2027, driven by biologics and personalised medicine. Andlauer’s investments in automation and expanded warehousing capacity enhance its competitive edge.

Rising fuel costs and potential U.S. trade tariffs (e.g., proposed 25% tariffs on Canadian goods) could increase operating expenses, given cross-border operations.

Andlauer’s defensive business model supports steady growth, with revenue increases of 5–10% annually and potential dividend growth. Its stock may perform well in volatile markets due to its resilience.
Savaria Corporation (TSX: SIS)

Savaria’s mobility solutions cater to an aging population, with a diversified global presence and a 3% dividend yield. Its consistent revenue growth and focus on accessibility products align with demographic trends.

The global mobility aids market is projected to grow at a CAGR of 6.8% through 2027, driven by aging populations and disability prevalence. Savaria’s expansion into Asia and Europe, along with new product launches (e.g., advanced stairlifts), supports growth.

Supply chain disruptions and raw material cost increases could pressure margins. Currency fluctuations may impact international revenue.

Savaria is poised for moderate growth (8–12% annual revenue increase), with stable dividends appealing to income-focused investors. Its stock may see steady appreciation, though less volatility than pure tech plays like WELL.

Broader Sector Outlook

Market Dynamics: The TSX healthcare sector, while small (representing ~2% of the S&P/TSX Composite Index), is gaining traction. The sector rose 0.6% in Q4 2024, reflecting investor interest. Companies leveraging technology to address inefficiencies in healthcare delivery are likely to outperform.
Investment Trends: The 2024 TSX30 highlights a shift toward value investing, with investors favoring cash-generating companies with dividends. Healthcare tech firms with strong fundamentals (e.g., WELL, Andlauer) align with this trend.

Risks
Economic Uncertainty: U.S. trade tariffs, rising interest rates, and inflation could increase costs and dampen investor sentiment. The TSX index fell 1.87% year-to-date in 2025, signalling caution.
Regulatory Hurdles: Stricter healthcare regulations or delays in government funding for digital health could slow growth.
Competition: Global players entering Canada’s market may challenge smaller TSX-listed firms.

While analyst optimism and market trends suggest strong growth potential, the healthcare tech sector is not immune to overhype. Valuations for companies like WELL may be stretched, with price-to-earnings ratios above sector averages (e.g., WELL’s P/E ~30x vs. sector ~20x). Investors should scrutinise cash flow sustainability, especially for acquisition-heavy firms.

Additionally, macroeconomic risks, such as U.S. tariffs, could disproportionately impact logistics-focused companies like Andlauer, given Canada’s trade reliance. The aging population narrative, while compelling, assumes consistent consumer spending, which may falter in a recession.

Over the next two years, TSX-listed healthcare technology companies like WELL Health, Andlauer Healthcare, and Savaria Corporation are well-positioned for success due to their alignment with secular trends (digital health, aging populations, and logistics resilience). WELL Health offers the highest growth potential but with elevated risk, while Andlauer and Savaria provide stability and defensive characteristics. Sector-wide, expect 10–20% annualised returns for top performers, though macroeconomic and competitive risks warrant caution. Investors should monitor quarterly earnings, regulatory developments, and global trade policies to assess ongoing viability.

Nelson Advisors > HealthTech M&A

We work with our clients to assess whether they should 'Build, Buy, Partner or Sell' in order to maximise shareholder value and investment returns. Email lloyd@nelsonadvisors.co.uk

Nelson Advisors regularly publish Healthcare Technology thought leadership articles covering market insights, trends, analysis & predictions @ https://www.healthcare.digital