I usually get asked to comment on the healthcare sector when defensive stocks or income, or value investing is being discussed. I can’t remember the last time I was asked to comment on the sector in the context of a growth opportunity though.

So today I’m going to do just that and comment on how the healthcare sector could be home to some of the most exciting investment opportunities of the next few years.

For many years now, the healthcare sector has been plagued by ‘patent cliffs’ and drug pipelines drying up. In investment terms, the sector has gone sideways for a good 10-15 years.

But over the last few months, while the focus has been on the developed market rallies (in particular the UK and Japan), the healthcare sector has been enjoying the start of a bull market all of its own. The sector has recently broken out of its sideways range and has posted some very positive returns.

So what has changed, and can it continue?

There are a number of reasons for its increase in popularity. The first is the chase for yield. Many companies in this sector pay a dividend and do so consistently. More and more investors are looking for this type of stock.

Secondly, there are the reforms taking place such as Obamacare in the US. At the moment no fewer than 45 million Americans are without health insurance. Once Obamacare goes through, more than half of these people will have some cover.

The major change though, according to Dr Dan Mahony, manager of the Polar Capital Healthcare Opportunities fund, is that companies in this sector are now growing because of the austerity measures we are facing, not in spite of them.

And importantly, for the continued rise of this sector, technology is about to have a major influence.

In 1960, the US government spent $30bn on healthcare. In 2010 it spent $2.6 trn. That’s about 15% of GDP. In the UK we spend slightly less at around 8% of GDP, but it’s still a lot and the government can’t afford for this bill to continue to increase. However, the ageing population means that more and more healthcare will be required in the coming years. So they have a real problem.

As governments look to reign in the budgets, it will be able about which companies can deliver healthcare for less, help people self-medicate and therefore keep people out of hospitals.

In the UK we have been used to getting our healthcare ‘free’, but many products and services are becoming out-of-pocket expenses. The consumerisation of healthcare is already under way. Each of us will become more responsible for managing our own health and we’ll start paying for things to help us do this.

And this is where technology will play its part. Most technological advances in the last few years have been for the consumer, like smart phones and iPads. We have apps for all sorts of things, so why not have a ‘doctor in your pocket’ too?

There are companies today which are making portable monitors available which will predict an epileptic fit a few minutes before it occurs. This device could be available on a monthly contract, like a mobile phone. In the future the device may also stop a fit from occurring. And there are already glucose monitors available which look like iPods, which diabetes sufferers use.

The exciting thing is that a lot of the technology is already available – companies just need to find ways of using it to improve our health. While that may not necessarily mean curing diseases, we may well be able to live with them for longer and with a better quality of life.

So for the first time in a generation, the heathcare sector looks like it holds the key to many exciting opportunities and, importantly, the catalyst required to make things happen.