In the realm of medicine, many individuals prefer the convenience of a pill over an injection. This preference resulted in a significant surge of over 14% in Eli Lilly’s (stock market ticker: LLY) shares following the announcement of its plan to introduce weight-loss pills instead of injections.

This development is promising for the $775 billion pharmaceutical sector and positively impacted my investments, as Eli Lilly ranks as the sixth-most valuable component of my long-term investment portfolio. I invested 2% of my life savings in July 2023 for a price of $441, and as of Friday, shares were trading at $878.

This advent of new weight-loss solutions arrives against a backdrop of market instability due to fears of a global trade war. However, with an increasing elderly population that typically allocates more resources to healthcare, this trend is likely to bolster demand and valuations in the industry.

Investing wisely can present opportunities for profit while contributing to societal good. Rather than investing in industries like tobacco, individuals can participate in funding important medical research.

On the other hand, investing in pharmaceutical companies carries risks. Many clinical trials face obstacles, and the pharmaceutical industry often deals with skepticism from the public, adding layers of political risk to operational challenges.

In this landscape, Novo Nordisk (NOVO), the leading global producer of insulin—essential for diabetes management—has come to the forefront. I initially acquired shares in February 2021 at approximately $36 per American depositary receipt (ADRs), which I later converted as part of a share split.

Upon discovering that the ADRs did not exempt me from Nordic withholding taxes, I purchased shares at 254 Danish krone in June 2021. With the popular weight-loss medications Ozempic and Wegovy gaining attention, I decided to sell half my position at DKK926 in August 2024.

That decision proved wise as Eli Lilly’s entry into the weight-loss market with its drug Mounjaro affected Novo Nordisk’s shares, which fell to DKK403 on Friday. Additionally, there are concerns about political ramifications from former President Donald Trump’s ambitions, which could adversely impact Novo Nordisk, especially considering its previous stock market valuation exceeding Denmark’s gross domestic product (GDP).

Not even major players like Pfizer (PFE) are exempt from market fluctuations. Although Pfizer was the first to receive authorization for a COVID-19 vaccine, shares that I purchased for $37 in January 2021 fell to below $23 as of Friday.

Fortunately, I hold Pfizer shares in an Isa, where the stock offers a 7.8% tax-free dividend yield, providing some solace for income-seeking investors like myself. These dividends have historically risen by an average of 3.1% annually over the past five years, according to the London Stock Exchange Group.

In contrast, my investment in Bavarian Nordic (BAVA), which develops vaccines for various insect-borne diseases, has not fared well. I bought shares at DKK258 in August 2024, but their value has since plummeted to DKK153. Nevertheless, Bavarian Nordic continues to produce vital vaccines that prevent significant illnesses, and considering the situation, I am grateful that the fears surrounding Mpox ultimately did not escalate into a global pandemic.

I must clarify that I lack medical expertise—something not uncommon among those who harbor vaccine hesitancy. This highlights why a professionally managed investment trust may be a viable option for gaining exposure to the pharmaceutical sector.

One of my long-standing investments is the Worldwide Healthcare (WWH) trust. I transferred shares from a paper-based broker for approximately £1.35 in July 2014, and they are currently priced at £2.84. However, I must acknowledge that the recent performance has been underwhelming.

Shares in Worldwide Healthcare have declined by 13% year-over-year and by 10% over the past five years, even though they have delivered total returns of 55% over the last decade. In contrast, the International Biotechnology (IBT) and Polar Capital Global Healthcare (PCGH) trusts have shown superior returns in their sectors over various time frames.

Turning back to the topic of weight-loss medications, research from the University of Florida indicates they may reduce the risk of various illnesses, including a one-third decrease in dementia incidence among older individuals with type 2 diabetes, as examined in a study of 90,000 medical records published this month.

Looking ahead, while the future remains uncertain in the political arena, the demand for medication and weight management will likely persist, suggesting that certain pharmaceutical investments could yield robust returns.

Exploring Technologies for Hearing Health

Recent studies reveal a strong correlation between hearing loss and increased dementia risk, suggesting that addressing hearing health is crucial. Research from Columbia University indicates that nearly a third of dementia cases in older adults can be attributed to significant hearing loss.

Theories positing the links between hearing impairment and dementia include social isolation stemming from communication difficulties and the cognitive strain required when the auditory system declines.

Various large companies are responding to this public health issue. Apple (AAPL), one of my most valuable stock holdings, has recently enhanced its AirPods Pro 2 with a free software upgrade that allows them to function as over-the-counter hearing aids for those with mild to moderate hearing loss.

Similarly, EssilorLuxottica (EL), another key holding of mine, caters to this market with innovative eyewear that also aids hearing. Their Nuance Audio glasses enhance communication by allowing users to better hear conversations.

For individuals experiencing significant hearing loss, Sonova (SOON) is among the top hearing aid manufacturers globally and has integrated artificial intelligence into its devices to minimize background noise.

The Apple shares I bought for $23.75 in February 2016 now trade at $207; EssilorLuxottica shares purchased at €96 in March 2019 are now valued at €252; and Sonova shares I acquired for 173 Swiss francs in November 2013 have appreciated to SwFr250. The importance and benefits of audio technology are becoming increasingly clear.

Full disclosure: Ian Cowie’s shareholdings