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The Market for PBMs Slows in 2016

by | Nov 23, 2016 6:44 pm | Managed Care, Other Services, Private Equity

Magellan Health, Inc. (NASDAQ: MGLN), a healthcare management company specializing in special populations and pharmacy benefits management, has just acquired privately held Veridicus Holdings, LLC. The sellers are Gauge Capital, company management and other unnamed backers. Based in Salt Lake City, Veridicus is a pharmacy benefit management (PBM) company that uses proprietary software to integrate pharmacy, medical and lab data to drive targeted interventions for complex patient populations. The $74.5 million deal gives Magellan access to Veridicus’ 225,000 members. Veridicus also owns and operates a fully licensed insurance company which serves members enrolled in the Medicare Part D... Read More »

Community Health Systems Starts Divesting Hospitals

by | Nov 23, 2016 4:57 pm | Home Health & Hospice, Hospitals

It’s no secret that Community Health Systems (NYSE: CYH) has a $15 billion debt load, and that despite its spin-off of Quorum Health Corp. (NYSE: QHC) last April, its financial performance hasn’t improved. During the company’s third-quarter earnings call on November 1, CEO Wayne Smith said the company was in discussions to shed 17 of its 157 hospitals, as well as home health services and non-hospital real estate. The most recent deal following that call was announced on November 17. Community Health’s Spokane, Washington-based Rockwood Health System will become part of Tacoma, Washington-based MultiCare Health System, a not-for-profit system that operates five... Read More »

WellCare Health Adds Universal American for $800 Million

by | Nov 22, 2016 7:26 pm | Managed Care

WellCare Health Plan (NYSE: WCG) breathed a little life into the lethargic Managed Care sector, which has experienced a lull in M&A this year. WellCare provides government-sponsored managed care services, and its target, Universal American Corp. (NYSE: UAM), provides health insurance and managed care products and services to Medicare and Medicaid customers in the United States. The purchase price is $800 million, or $10.00 per share, representing a 34% premium to Universal American’s 60-day volume-weighted average closing stock price as of November 16, 2016, and includes the retirement of Universal American’s preferred shares and its convertible debt. WellCare expects the... Read More »

CROs Are Back, Many with Specialties

by | Nov 18, 2016 4:12 pm | Other Services, Private Equity

We’ve documented the increase in biotechnology acquisitions and license deals by pharmaceutical companies in previous posts. But the impact of pharma’s move away from in-house R&D has benefited other sectors of the healthcare industry, particularly clinical research organizations (CROs). For those outside the technology side of healthcare, CROs provide outsourced research services to the pharmaceutical, biotechnology, and medical device industries on a contract basis. Through mid-November, we’ve seen an increase of 325% in deal volume for CROs, compared with the year before. In 2015, just five deals for these targets were announced. So far this year, 17 are on the... Read More »

November Sees a Surge in Lab Deals

by | Nov 17, 2016 8:00 am | Laboratories, MRI & Dialysis, Private Equity

Four deals in our Laboratories, MRI & Dialysis sector have been announced in the first half of November. That much activity constitutes a surge for this sector, which now stands at 39 deals through all of 2016. With only six weeks left in the year, it seems unlikely that this sector will surpass 2015’s total of 52 deals. On November 1st, Vital Images, Inc., a subsidiary of Toshiba Medical Systems Group, acquired Karos Health for an undisclosed price. Karos Health provides standards-based clinical imaging exchange and cross-enterprise workflow and diagnostic imaging solutions. The combined technologies provide a customer-centric, modular platform that allows hospital systems to solve a... Read More »

What U.S. Hospitals Are Acquiring in 2016

by | Nov 16, 2016 8:45 pm | Behavioral Health Care, eHealth, Home Health & Hospice, Hospitals, Laboratories, MRI & Dialysis, Long-Term Care, Managed Care, Other Services, Physician Medical Groups

Hospital acquisitions have surged since the Affordable Care Act was passed in 2010. That year, 76 deals were announced, with a U.S. hospital or health system as a target. By 2012, 107 transactions were recorded for hospital targets, and that still stands as the highest number of deals per year. Only 2015 came close, with 102 hospital transactions. Through mid-November, there have been 79 deals announced with U.S. hospitals or health systems as the target. But what are U.S. hospitals acquiring for their own financial health? Other hospitals or health systems make up the majority of targets every year, of course.  So far this year, through mid November, 66 transactions... Read More »

Boston Scientific Seeks Out Portfolio Acquisitions

by | Nov 15, 2016 4:57 pm | Medical Devices

Earlier this year, Boston Scientific Corporation (NYSE: BSX) acquired two companies: Cosman Medical Inc. to strengthen its neuromodulation business and EndoChoice Holdings Inc. to strengthen its pathology services and imaging technologies. Since then, the medical device giant has toned down its acquiring habits with two asset/portfolio purchases in November. On November 3, 2016, the company acquired the LumenR™ Tissue Retractor System from LumenR LLC. It is currently in development for use during endoscopic resection of lesions in the colon, esophagus or stomach. Boston Scientific will conduct additional development and evaluation of the system prior to commercialization. On November 15,... Read More »

Biotech Boomed Even Before Trump’s Election

by | Nov 11, 2016 4:31 pm | Biotechnology, Pharmaceuticals

Now that Donald Trump has transitioned from presidential candidate to president-elect, his pro-business views have cheered many deal makers. His “repeal and replace” pronouncements regarding the Affordable Care Act have chilled some areas of the healthcare market, but others are thriving. Biotechnology is one sector that was already experiencing a boom in mergers and acquisitions, prior to November 8. Third-quarter deal volume surged 58%, to 52 transactions. Sixteen deals were recorded in October 2016, and in the first two weeks of November, 12 are already in our database. Ten of those are license agreements, as pharmaceutical companies swoop in to claim promising product... Read More »