If you're interested in gaining exposure to the small cap side of the market, I think it could be worth looking for options in the healthcare sector.
In this sector there are a number of companies that are benefiting from favourable tailwinds and have the potential to grow materially in the future.
Three small cap ASX healthcare shares to watch are listed below:
Mach7 Technologies Ltd (ASX: M7T)
Mach7 is a medical imaging data management solutions provider which uses software to create a clear and complete view of the patient. The company's software helps to inform diagnosis, reduce care delivery delays and costs, and, importantly, improve patient outcomes. It recently expanded its offering via the acquisition of enterprise image viewing technology company Client Outlook. Combined, Mach7 now has a total addressable market of US$2.75 billion.
Medadvisor Ltd (ASX: MDR)
Medadvisor is a software systems developer with a focus on personal medication adherence. It offers an app that connects to pharmacy dispensing systems and has been designed to ensure correct and reliable medication use. In Australia it has connected over one million users through nearly 60% of Australian pharmacies and a network of thousands of GPs. Outside Australia, the company has growing operations in the United States, Asia, and UK markets.
Volpara Health Technologies Ltd (ASX: VHT)
Volpara uses artificial intelligence imaging algorithms to assist with the early detection of breast cancer. At the last count, its market share in the United States had grown to 27% of women screened for breast cancer. The company also advised that the annual revenue per user (ARPU) within its US breast cancer operations stood at approximately NZ$1.70 (US$1.09). However, thanks to the expansion of its product suite, during the second quarter the company has been seeing quotes with ARPU rising up to US$8.00. This is a huge step forward and validates management's belief that its whole software platform will command ARPU of US$10.00.
