AI Medicine and Local Care
Neil Batlivala@nbatlivala
−0.3%
since Oct 3
The idea
I believe AI reshapes medicine but the surer money is in the tools and trial infrastructure every discovery program needs, so that gets the bigger allocation with a smaller slice in direct discovery bets. I also think automation pushes virtual care aside and shifts labor and demand toward hands-on care at home and in the community, so I own the operators positioned for that over the next decade. A third leg owns the power, cooling and networking bottlenecks behind data center growth, plus the landlords collecting rent regardless of whose chips win.
What it owns
- As virtual care automates, labor shifts to hands-on work, cutting costs for care operators just as demand for home-based services grows. · Ensign GroupIt operates skilled nursing facilities that benefit as care shifts to lower-cost community settings and labor supply improves., Addus HomeCareIt delivers home-based care and wins from both rising demand for local services and lower staffing costs as labor redirects from virtual roles., Option Care HealthIt delivers home infusion services, benefiting as patient care and medication administration shift out of hospitals into the home., ChemedIts hospice arm provides end-of-life care in homes and communities, the most local and hands-on care delivery model., Encompass HealthIt operates rehabilitation centers outside hospitals, benefiting as care becomes more distributed and labor flows toward hands-on roles., Pennant GroupIt acquires home health and senior living assets in smaller markets where localized care delivery has the most impact.25%
- Power, cooling and networking are the scarce inputs limiting data center growth, a less crowded angle than betting on the chips themselves. · Arista NetworksIts switches connect chips inside AI data centers and remain a bottleneck regardless of whose silicon architecture wins., EatonIt sells the electrical infrastructure every new data center needs, independent of what chips or software runs inside., Vertiv HoldingsIt supplies the cooling and power equipment that lets high-density AI racks operate, a binding constraint as buildout accelerates., Quanta ServicesIt builds the utility and grid connections that data centers require, profiting as power infrastructure becomes the limiting factor., GE VernovaIt manufactures turbines and grid equipment that generate and transmit power to data centers, winning as demand for electricity accelerates.23%
- Whoever wins at AI drug discovery, all of them buy lab instruments, sequencing, manufacturing gear and trial services from these companies. · Thermo Fisher ScientificIt sells instruments, reagents and lab services across biologics discovery, so its revenue grows as AI-driven R&D programs expand., DanaherIts bioprocessing gear manufactures molecules at scale, so more AI-designed biologics candidates mean higher equipment orders., IlluminaIts sequencers generate the data that trains AI biology models, so adoption grows as computational drug design scales., Veeva SystemsIt provides the software backbone for running clinical trials, a necessary layer in every drug program that moves from discovery to testing., Medpace HoldingsIt runs outsourced clinical trials, so more AI-discovered candidates create higher demand for trial infrastructure and execution.23%
- Direct stakes in companies actually using AI to design drugs, from deep-pocketed adopters to earlier-stage ventures. · Eli LillyIt has the scale and resources to deploy AI across drug development, turning R&D spending into approved medications at pace., SchrodingerIt sells computational platform software for molecular design, profiting if AI-driven drug discovery becomes standard practice in pharma., Recursion PharmaceuticalsIt uses AI to discover drug candidates end to end, betting that algorithms find molecules humans would miss, with partnerships validating the approach.10%
- REITs that rent data center space collect from the buildout itself, regardless of which AI company or chip design wins. · EquinixIt collects rent from data center occupancy driven by AI demand, earning from the buildout without picking a technology winner., Digital Realty TrustIt leases space to hyperscalers filling data centers with AI infrastructure, earning from the expansion without taking technology risk.9%
- Cash10%