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Hospital Transactions, 2012 to 2016

by | Mar 10, 2017 4:42 pm | Hospitals

Hospital merger and acquisition activity softened in 2016, as more transactions came in the form of joint operating ventures, affiliations or partnerships rather than long-term financial commitments. These deals represent safer financial territory than an outright commitment to a struggling facility. M&A transactions among larger hospitals and health systems are shifting to a more strategic focus, to gain market share, cost efficiencies and greater negotiating power. Deals involving small, standalone hospitals, however, are still driven largely by financial pressures. Health systems are also acquiring more pre- and post-acute care facilities and services, as well as physician medical... Read More »

Amedisys Adds Six Tenet Home Health Centers

by | Mar 10, 2017 3:46 pm | Home Health & Hospice

Shortly after reporting improved cash flow on its Q4:16 earnings call, Amedisys, Inc. (NASDAQ: AMED) went on a short spending spree. The company picked up six home health and hospice centers from Tenet Healthcare (NYSE: THC), located in Arizona, Illinois, Massachusetts and Texas.  No financial terms were disclosed. Despite potential headwinds from the Republicans’ proposed American Health Care Act (AHCA), still in the House of Representatives, the Home Health & Hospice sector is expected to see strong growth in the coming years. Baby boomers are aging, inevitably, and many are expected to attempt to age-in-place at home, boosting demand for these services. Amedisys’... Read More »

Arizona Behavioral Health Company Grows

by | Mar 9, 2017 12:35 pm | Behavioral Health Care, Managed Care

Behavioral health care deals dried up in February, but the action is picking up again. On March 2nd, 2017, not-for-profit Community Partners Inc., a parent company of behavioral healthcare service providers in Arizona, acquired Tucson-based Assurance Health & Wellness, for an undisclosed amount. Assurance Health, a division of Sinfonia HealthCare Corporation, serves approximately 7,000 clients in a clinic that combines primary care with behavioral health treatment. Fletcher McCusker, CEO of Sinfonia, cited financial pressures as a reason for the combination. The combined company will operate as a not-for-profit entity, and will be one of the largest providers of mental health services... Read More »
Health Care Deals Cratered in February 2017

Health Care Deals Cratered in February 2017

by | Mar 3, 2017 5:44 pm | Medical Devices, Pharmaceuticals

After a very strong performance in January 2017 with 160 transactions announced, February’s deal volume collapsed 45%, to just 88 transactions (see chart below). Compared with the same month a year ago, it’s was only down 30%, to 125 deals. Don’t forget, 2016 was a leap year, so an additional six more deals snuck into last year’s results on February 29. What difference that doesn’t make for this year’s results. Yes, it’s all because of the uncertainty around the fate of the Affordable Care Act. Many of the services sectors will be effected by what becomes of Medicaid, whether states will receive block grants, or some other solution. At least two of... Read More »
Strategic vs. Financial Healthcare Buyers in 2016

Strategic vs. Financial Healthcare Buyers in 2016

by | Mar 2, 2017 3:56 pm | Behavioral Health Care, Home Health & Hospice, Hospitals, Laboratories, MRI & Dialysis, Long-Term Care, Managed Care, Other Services, Physician Medical Groups, Private Equity, Rehabilitation

Every spring, we publish myraid statistics on the healthcare services deals announced the year before, in the form of The Health Care Services Acquisition Report. This year’s 23rd edition, which will available in late March, has this examination of what financial buyers targeted in 2016. Strategic buyers continued to dominate the health care services M&A market in 2016, as they have in the past. Their 683 deals made up 73% of the year’s deal volume. The $45.7 billion spent accounted for 63% of the combined total of $72 billion. A total of 259 deals, or 27% of the services deal volume in 2016, were carried out by financial buyers, such as private equity firms and real estate... Read More »

Perrigo Lets Go of Tysabri Royalties

by | Mar 1, 2017 8:23 pm | Biotechnology, Pharmaceuticals

What goes around comes around. It doesn’t seem that long ago that the Dublin-based drug firm Elan Corporation plc was fighting off the hostile advances of Royalty Pharma. It was July 2013, in fact, when Elan agreed to be acquired by Perrigo (NYSE: PRGO) for $8.6 billion. To refresh the memory, Elan was a biotech company whose portfolio included royalties from Tysabri®, a multiple sclerosis treatment, and a neuropsychiatric pipeline with near-term value creation potential.  Early February 2013, Elan sold half of its rights to Tysabri to Biogen Idec, now known as Biogen Inc. (NASDAQ: BIIB), for $3.25 billion. At the time, the terms called for $3.25 billion upfront cash plus 12% of... Read More »

Sterling Partners Expands into Ophthalmology

by | Feb 27, 2017 9:37 pm | Physician Medical Groups, Private Equity

Sterling Partners, a Chicago-based private equity firm, added the first ophthalmology practice to its healthcare services portfolio with the acquisition of Grand Rapids Ophthalmology. GRO is the first eye care provider to join Great Lakes Management Services Organization, a practice management services organization formed by Sterling to support GRO’s local expansion and larger-scale growth. GRO offers a full suite of eye care services including optometry, retail optical, oculoplastics, cataract surgery and retinal sub-specialties. It employs 11 ophthalmologists and 18 optometrists in 11 locations. Sterling Partners has been busy building up platforms in other areas of healthcare services,... Read More »

What’s Next for Managed Care?

by | Feb 24, 2017 8:38 pm | Managed Care, Physician Medical Groups, Private Equity

The managed care mega-deals of 2015 have blown up. Aetna (NYSE: AET) and Humana (NYSE: HUM) amicably terminated their $37 billion merger, following a federal judge’s order in January to block the deal on antitrust grounds. The $1 billion termination fee was in the works. A different federal judge blocked Anthem (NYSE: ANTM) and Cigna’s (NYSE: CI) $54.2 billion merger on similar grounds. Things turned ugly quickly, as Cigna declared the deal dead and sued Anthem for the $1.85 billion termination fee, and another $13 billion in damages on behalf of its shareholders. Anthem says it will go ahead with the merger. What do the Big Five health insurers do now that they’re... Read More »