Following a robust start in January, healthcare M&A volume declined notably in February. With 144 announced transactions, the deal volume for February 2026 is 40% lower than the 240 reported in January 2026, but marks a small decrease from the 150 announced in February 2025. Despite the decline in M&A volume, it is worth noting that February is historically a quiet month for deal activity and is following the trend; over the last five years, there has been an average of 150 deals reported throughout February.
As with most months, most transactions were in the Physician Medical Group (PMG) sector, with 33 deals, accounting for 23% of activity. This is a 42% drop from the 57 PMG deals reported in January 2026, but a slight increase from the 29 announced in February 2025. Private equity (PE) interest in the PMG sector, in both year-over-year and month-over-month comparisons, remained relatively unchanged, hovering around 50%. However, the percentage of deals that fell under the dental specialty rose (up to 48% from 42% in January 2025 and 45% in February 2025), indicating that investors are consolidating their interest in the PMG field.
While overall healthcare deal volume dropped year over year, the Medical Outpatient Building (MOB) market showed its resilience with 16 transactions. This is on par with the 16 reported in January 2026 and one more than the 15 in February 2025. More than 513,000 square feet, across 27 facilities, were purchased last month.
Montecito Medical Real Estate, which has reported five deals this year, announced the largest MOB deal in terms of square footage with the acquisition of a five-building portfolio. Predominantly occupied by OneOncology, the portfolio totals 152,000 square feet and is spread across Michigan. In its second deal, Montecito acquired a Texas-based HCA Surgery Center Portfolio that totaled 65,024 square feet.
Despite a rise in healthcare AI capabilities and contrary to industry experts’ expectations, eHealth activity has decelerated. With only 14 deals reported in February, it’s half the volume we captured in January 2026 and a 37% decrease from February 2025.
Leading the eHealth market, there were five deals targeting medical practice management software companies. While this represents a slight dip from the seven deals reported in January 2026, it maintains an upward trajectory compared to the three deals announced in February 2025. There were three telehealth transactions, a drop from the five reported in the previous month.
PE once again dominated the healthcare space, accounting for more than 31% of activity (45 deals). Deal activity was led by investors such as Leonaord, Green & Partners, L.P. (four deals), Latticework Capital Management (three deals) and VSS Capital Partners (two deals). The only PE transaction with a disclosed price was Kinderhook Industries’ acquisition of Enhabit, Inc., for $1.1 billion.
Health systems were also busy, accounting for more than 10% of activity with 15 deals. With only two hospital acquisitions, health systems focused on expanding their services outside traditional hospital settings by completing five outpatient services deals as well as six PMG deals.
HCA Healthcare completed three transactions, adding one cardiology group, a portfolio of six free-standing emergency rooms and a portfolio of 13 urgent care centers. HCA Houston, an affiliate of HCA Healthcare, also reported the acquisition of Supreme Care ER. Other health systems that reported deals throughout the month were SSM Health and Northwell Health.
Disclosed spending totaled more than $21 billion across 26 deals, a marginal decline from January’s total of $21.2 billion across 32 transactions. However, it is more than double February 2025, when more than $10.4 billion was reported across 40 deals, indicating that more high-value assets are hitting the market.
Nearly 50% of the deals in February 2026 with a disclosed price tag were in the MOB sector, averaging more than $11.8 million per transaction.
The largest purchase price of the month was Danaher’s $9.9 billion acquisition of Masimo, a remote patient monitoring company based in Irvine, California. Masimo’s products include measurement devices, sensors, patient monitors and automation and connectivity solutions. According to its most recent earnings filing, Masimo reported a total consolidated revenue of nearly $2.1 billion for full-year 2024, and an EBITDA loss of nearly $140 million.
Danaher designs, manufactures and markets professional, medical, industrial and commercial products. According to its most recent financial report, the company’s FY 2025 revenues were $24.6 billion.
Another notable deal with a purchase price was Gilead Sciences, Inc.’s acquisition of Arcellx, Inc. The price includes $115 per share in cash at closing, plus one contingent value right of $5 per share, for an implied equity value of $7.8 billion.
Arcellx is a clinical-stage biotechnology company. According to its most recent annual filing, Arcellx reported $107.9 million in total revenue for fiscal year 2024, and EBITDA was a loss of $132.4 million.
Gilead Sciences is a research-based biopharmaceutical company that discovers, develops and commercializes medicines in areas of unmet medical need. In a February 2026 financial report, the company announced $29.4 billion in revenue for 2025.
