Disruptive innovation is extremely lucrative for investors. New ways of attacking old problems can breathe new life into markets where growth is slowing. Likewise, new technologies or business models pave the way for smaller companies to displace the established competitors. But going where nobody has gone before often means facing formidable or unknown risks.

Today I'll be discussing two disruptors in the healthcare sector. Though these companies are very different in terms of their lines of business, and their futures are far from certain, both have developed innovative approaches to longstanding issues in their industries. Investors seeking stocks with the potential for massive and long-term returns should take note.

A doctor holds a cloud which represents data.

Image source: Getty Images.

1. Teladoc is making telemedicine the default for consumers

Teladoc Health (NYSE:TDOC) made waves earlier this year in the midst of the burgeoning coronavirus pandemic, quickly becoming the go-to option for telehealth as doctors' offices and clinics were forced to close. In the second quarter of this year, Teladoc experienced a 203% year-over-year increase in its number of virtual healthcare visits. For all of 2020, Teladoc expects to serve nearly 10 million virtual visits. While it's true that Teladoc was in the right place at the right time, the company was a disruptor well before the pandemic. 

Simply put, Teladoc provides the doctor-on-demand service that most consumers wish they could get from their primary care physician. When patients have a health problem, they book an appointment with Teladoc, and shortly afterwards, they're on the phone or a video call with a doctor. If they need a referral for further care, they can get one immediately. Plus, Teladoc visits are covered by a variety of insurance plans, so the cost is typically affordable for consumers.

While Teladoc does have some smaller competitors and it also competes with telehealth services offered by insurance companies, its execution is very strong, and its ambitions are quite large. The company aims to become a digital hub for both in-person and virtual healthcare, ranging from routine mental health services to specialty medicine and even diagnosing acute health issues. Thanks to its upcoming merger with Livongo, Teladoc will also be able to integrate with medical sensors like continuous glucose monitors (CGMs) to provide real-time data to clinicians while also prompting patients to seek treatment. Given that most people don't have a similar arrangement with their main physician, it's clear that Teladoc is prepared to disrupt the entire primary care industry.

2. Vaxart's oral tablets will revolutionize vaccine distribution logistics

Unlike Teladoc, Vaxart (NASDAQ:VXRT) competes in the biotech industry by producing vaccines, and it doesn't have any product on the market yet. Vaxart is known among biotech investors for its coronavirus vaccine candidate, which is entering its phase 1 clinical trials. The company's disruptive innovation is that its vaccines are formulated as oral tablets rather than injections. 

Vaxart isn't the first company to make oral vaccine tablets, but it is the first to focus on them exclusively. Oral tablets have several advantages over injections. First, tablets don't require products like syringes, alcohol wipes, bandages, or examination gloves to safely administer to patients. Thus, their cost to administer could be lower than traditional prophylactics. Nor do they require a skilled healthcare provider to administer like an injection does. Many patients will be able to self-administer their vaccinations.

Perhaps most importantly of all, Vaxart's vaccines are shelf stable, so they don't need refrigeration like nearly all other inoculations do. The World Health Organization (WHO) estimates that over 50% of vaccines are wasted globally every year because of temperature control and logistics issues. Vaxart's shelf stable tablets will allow for easier distribution to areas without refrigeration infrastructure, using normal vehicles rather than refrigerated trucks. It also means that doses can accumulate at the point of use without worrying about them going bad or running out of storage space. 

So far, Vaxart's preliminary data suggests that its products may be more effective than industry-leading injectable vaccines for certain illnesses like influenza. If this holds true for other infectious diseases like the novel coronavirus, it will only be a matter of time until Vaxart forcefully disrupts the market. In the meantime, keep an eye on its ongoing clinical trials to see whether it runs into any obstacles like serious side effects that could reduce the appeal of its oral vaccine platform.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.