Healthcare is considered a defensive industry, since good medical care is needed regardless of economic or market conditions. Therefore many companies in this sector are somewhat insulated from the impact of economic downturns. If they can remain ahead of the changes in their niches by being innovative, they can be successful over long periods.

In other words, for those looking for "forever stocks," it's not a bad idea to look in this sector. And even with a modest sum -- such as $200 -- we can find excellent healthcare corporations to invest in for good. Here are two great examples: Bristol Myers Squibb (BMY 0.57%) and DexCom (DXCM -2.68%).

1. Bristol Myers Squibb -- $55 per share

The pharmaceutical industry is challenging to navigate. Developing novel medicines is risky and time-consuming, and comes with a maze of regulatory challenges. And drugmakers eventually face patent cliffs that erode the sales potential of even their best-selling drugs. Any company that can survive and thrive in this sector for a long time is worth serious consideration as a "forever stock."

Bristol Myers Squibb is one of these. The drugmaker has a deep lineup of products across areas such as oncology (perhaps its most crucial segment), immunology, rare diseases, and more. Though it ran over a significant patent cliff a couple of years ago -- with its formerly best-selling drug, cancer med Revlimid -- BMS is back to top-line growth. Revenue for 2024 grew by a solid 7% year over year to $48.3 billion.

The company will encounter more patent cliffs. However, just as it dealt with the last one, it can get past others in the future through innovation. Its pipeline has produced several important medicines in recent years.

Reblozyl, which treats anemia in patients with beta-thalassemia (a rare blood disease), first earned approval in 2019 and generates more than $1 billion in annual sales, an impressive achievement. Several other of the company's newer medicines should follow that lead in the coming years. And BMS still has a deep pipeline, with more than 50 clinical compounds across dozens of clinical trials that will lead to brand-new approvals and label expansions.

Finally, Bristol Myers Squibb is a solid dividend stock. Its forward yield is a healthy 4.5%, compared to the S&P 500's (^GSPC -0.47%) average of 1.3%. BMS has raised its payouts by over 67% in the past decade. Reinvesting the dividend will boost already competitive long-term returns. Long-term investors should seriously consider adding this stock to their portfolios.

2. DexCom -- $89 per share

DexCom is a medical-device specialist that focuses on diabetes care. The company develops continuous glucose monitoring (CGM) systems that help diabetics track their blood sugar levels efficiently throughout the day (and night). These devices have grown in popularity in recent years because of several factors.

First, there's been a substantial increase in the number of diabetes patients in recent decades. Second, CGM helps improve health outcomes among diabetics. Third, payers increasingly recognize the value of these devices and agree to cover them for a growing number of people.

Thanks to these and other factors DexCom has ridden this wave and, despite stiff competition from Abbott Laboratories, performed well over the past decade:

DXCM Revenue (Annual) data by YCharts.

That said, there's massive growth room left. As of last year, just about 1% of diabetes patients worldwide had access to CGM technology; many more are in countries where DexCom does not currently operate. The company has historically increased its addressable market by entering new territories; expect DexCom to continue doing that.

Some might point out the growing competition in diabetes care. For instance, several drugmakers are looking to develop cures for type 1 diabetes. DexCom, though, is diversifying. Last year, it earned approval for an over-the-counter CGM option, Stelo, that also targets patients with prediabetes.

At any rate, healthcare providers need a variety of options to curb the worldwide diabetes epidemic, including CGM devices. DexCom has shown its ability to innovate in the field. The company also benefits from a network effect since its CGM options are compatible with other third-party devices aimed at helping diabetes patients.

There's one more reason that DexCom's prospects look bright: The stock could reward its shareholders over the long run, which makes it worth holding onto for good.