Which ASX 200 healthcare shares delivered the top returns in 2020?

COVID-19 created tailwinds for many ASX 200 healthcare shares. Here are the ones that came out on top in 2020.

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The onset of a major pandemic last year created tailwinds for many ASX 200 healthcare shares that supported the global effort to tackle COVID-19.

This accelerated the earnings of many ASX 200 healthcare shares, including familiar names such as Resmed Inc (ASX: RMD) and Fisher & Paykel Healthcare Corp Ltd (ASX: FPH).

However, the ASX 200 healthcare shares that delivered the very top returns in 2020 may come as a surprise.  

Top performing ASX 200 healthcare shares of 2020

1. Polynovo Ltd (ASX: PNV

The Polynovo share price doubled in 2020 to find itself as the top performing ASX 200 healthcare share. The company has recently commercialised its NovoSorb BTM product which is used to temporarily close wounds and aid the body in generating new tissue.

NovoSorb BTM has experienced strong sales across approved regions including the United States, Australia, New Zealand, Singapore, India, Taiwan and various countries in the EU. And also pending regulatory approval in Canada and Korea. 

In FY20, Polynovo's revenues increased 54.6% to $22.2 million, largely driven by the $19.06 million contribution from Novosorb BTM sales. Managing director Paul Brennan has great confidence in the company's ability to continue grow Novosorb BTM with the expectations to double its revenues in FY21. 

2. Pro Medicus Limited (ASX: PME

The Pro Medicus share price has gone from strength to strength in 2020, increasing 50%. The leading provider of radiology information systems has experienced another strong year of growth, with its technology enabling its clients to seamlessly switch to remote reading during COVID-19. 

During the FY20 year, the company announced several new contract wins which have been described as significant in their own right and will make a major contribution to its future revenues. Despite the series of positive new contract wins announced in 2020, the management team is still working on a significant number of new opportunities and its pipeline continues to be strong. 

3. Fisher & Paykel Healthcare Corp Ltd

The Fisher & Paykel share price ran 45% higher in 2020 to record all-time highs, driven by the increased demand for the company's hospital hardware. In the first half of its 2021 financial year, which ended 30 September 2020, the company's net profit after tax soared 86% to $225.5 million. 

Looking ahead, the company is making the assumption that its performance in the second half of FY21 will be weaker than 1H21. This is due to hospital hardware returns returning to approximately normal rates combined with reduced diagnosis rates for its obstructive sleep apnea business and elevated freight costs.

Its anticipation of weaker earnings could be the reason why the Fisher & Paykel share price has underperformed other ASX 200 healthcare shares in the second half of 2020.

Lina Lim has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of POLYNOVO FPO. The Motley Fool Australia's parent company Motley Fool Holdings Inc. recommends Pro Medicus Ltd. The Motley Fool Australia owns shares of and has recommended Pro Medicus Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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