M and A Slows in Pharma Sector in 2016

by | Jan 9, 2017 5:16 pm | Pharmaceuticals

The pharmaceutical industry has been the behemoth of healthcare M&A, usually accounting for the largest dollar amounts spent in any given year and often one of the most active in terms of number of transactions. But since its record year in 2014, this sector has been on a slow decline. Big Pharma deal volume dropped 9% since 2015, from 171 that year to 156 deals in 2016. Dollars spent slid even further, down 39%, from $138.4 billion in 2015 to just $84.45 billion in 2016. The Pharma sector is notorious for its multi-billion dollar mega deals. The largest pharma deal in 2016 is a prime example, as it was also the largest deal of the year. That was Shire plc’s... Read More »

2016 Delivered on Health Care M and A

by | Jan 6, 2017 8:20 pm | Behavioral Health Care, Biotechnology, eHealth, Home Health & Hospice, Hospitals, Laboratories, MRI & Dialysis, Long-Term Care, Managed Care, Medical Devices, Other Services, Pharmaceuticals, Physician Medical Groups, Rehabilitation

As health care mergers and acquisitions go, 2016 lived up to the predictions that M&A activity would stay strong. Preliminary data for year-end totals shows 1,536 announced transactions across 13 healthcare sectors. The total represents a 1% increase in deal volume compared with 2015. (See chart below.) Spending on those deals was significantly lower than the previous year, at least for now. The combined total spending in 2016 now stands at $255.7 billion, down 36% compared with 2015’s $400.3 billion. Nearly $100 billion of that total now hangs in the balance, as two of 2015’s largest deals (Anthem/Cigna and Aetna/Humana) await decisions from a federal judge regarding... Read More »

PMG Sector Sets Record in 2016

by | Jan 6, 2017 8:12 pm | Physician Medical Groups, Private Equity

Mergers and acquisitions in the Physician Medical Group sector hit a record 119 transactions in 2016, up 19% over 2015’s previous record of 100 announced transactions. Consolidation was a big theme, as some of the top publicly traded companies either merged or were taken private. Another factor driving independent physician practices to team up was MACRA (the Medicare Access & CHIP Reauthorization Act of 2015), which gave smaller physician practices the option to stay with fee-for-service Medicare reimbursement, or to switch to value-based payment for treating Medicare patients. The best option for many groups was to join a larger practice or the local hospital. Despite the frenzy of... Read More »

Hospital Deals Dipped in 2016

by | Jan 6, 2017 1:39 am | Hospitals

What the Affordable Care Act gave to the hospital sector, in the form of millions of more insured patients, it slowly took away, in the form of declining inpatient visits and growing competition from freestanding emergency rooms, ambulatory surgery centers and urgent care clinics. The ACA’s beneficial effects were largely played out by the third quarter of 2015, and by 2016, the thrill was gone. Hospital M&A slid slightly in 2016, according to our preliminary year-end data. Eighty-nine hospital deals were announced, down 13% compared with 2015. Spending was far higher than a year ago, reaching nearly $14 billion, a figure 47% higher than 2015’s combined total of $9.5... Read More »