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3 small cap ASX healthcare shares which could have big futures

One area of the market which I think is home to a number of promising small cap shares is the healthcare sector.

Thanks to positive tailwinds and their impressive technology or products, I believe there are many companies that are well-placed to grow at a strong rate over the next decade.

Three which I rate highly are listed below. Here’s why they could be worth adding to your watchlist:

Alcidion Group Ltd (ASX: ALC)

Alcidion is an informatics solutions provider which develops and sells healthcare analytics software used by hospitals and healthcare providers. This software improves the efficacy and cost of delivering services to patients and reduces hospital-acquired complications. Earlier this year the company won its first major contract with the Dartford and Gravesham National Health Service (NHS) Trust in the United Kingdom. Due to the quality of its software and the shift to a paperless environment by the NHS, I suspect this could be the first of many contract wins for the company.

Telix Pharmaceuticals Ltd (ASX: TLX)

Telix Pharmaceuticals is a clinical-stage biopharmaceutical company developing an advanced pipeline of molecularly-targeted radiation (MTR) products. MTR is an approach which chemically links radioactive isotopes to targeting molecules specific to cancer cells. The company has an advanced pipeline which addresses clear unmet medical needs in high-value oncology segments such as renal cancer, prostate cancer, and glioblastoma. One of the key products in its pipeline is TLX591. This is a metastatic prostate cancer radionuclide therapy which management estimates provides Telix with a $2 billion opportunity in late-stage disease alone.

Volpara Health Technologies Ltd (ASX: VHT)

Volpara is a medical technology company which has been growing at an incredible pace over the last few years. This continued in FY 2019 when the company reported a 78% year on year increase in revenue. The key driver of this was the increasing demand for its software which leverages artificial intelligence imaging algorithms to assist with the early detection of breast cancer. During the 12 months the company grew its share of the U.S. breast screening market by 120% to 7.1%. I’m confident that its growing footprint and recent acquisitions and agreements will lead to similarly strong growth in FY 2020.

And let's not forget this fourth small cap healthcare share that looks set to profit greatly from the medicinal cannabis boom.

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Motley Fool contributor James Mickleboro owns shares of TELIXPHARM DEF SET. The Motley Fool Australia owns shares of and has recommended VOLPARA FPO NZ. The Motley Fool Australia has recommended Alcidion Group Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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