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Team Health Pays $1.6 Billion for Hospitalists

by | Aug 10, 2015 8:50 am | Physician Medical Groups

The $1.6 billion acquisition of IPC Healthcare (NASDAQ: IPCM) by Team Health Holdings (NYSE: TMH), announced last week, was just the latest—and, yes, the biggest—in a stream of transactions targeting physician medical groups. The deal vaults Team Health to a leading position in the increasingly strategic post-acute setting, and effectively positions the company to capitalize on CMS’ migration to value-based, bundled payments, with the combined companies set to manage some $2 billion in Medicare spending. The risk, of course, is that the company will depend on government payors for more than half of their patients, and self-pay patients for another 15% of reimbursement. And with hospital... Read More »

Generic Drug Market Got a Shake-Up in July

by | Aug 3, 2015 8:40 am | Pharmaceuticals

Sure, you’ve heard about Teva Pharmaceutical Industries’ (NYSE: TEVA) $40.5 billion acquisition of Allergan Generics (NYSE: AGN), announced on July 27. Less hyped was Teva Pharmaceuticals USA’s sale of 22 previously marketed generic drug brands to ANI Pharmaceuticals, Inc. (NASDAQ: ANIP) for $25 million and a percentage of future gross profits from product sales. Earlier in the month, Indian drug maker Lupin Limited (NSE: LUPIN.NS) bought the Russian generic drug maker ZAO Biocom for an undisclosed price, and then U.S.-based generic formulator GAVIS Pharmaceuticals LLC and its manufacturing plant for $880 million. The day after the Teva/Allergan announcement, Hikma Pharmaceutical LLC... Read More »

Health Care M&A Exploded in July

by | Aug 3, 2015 8:39 am | Managed Care, Pharmaceuticals

The fireworks didn’t end on the Fourth of July, at least for the health care M&A market. Preliminary data shows deal volume rose 16% to 121 deals, compared with June’s 104 deals. Thanks to the mega-deals among health insurers and generic drug makers, deal value was approximately $166.6 billion, up 883% over June’s $16.9 billion. A full report will be published in the August issue of Health Care M&A News. Top 5 Health Care M&A Deals in July 2015 AcquirerTargetPrice Anthem, Inc. Cigna Corporation$54.2 billion Teva PharmaceuticalsAllergan Generics$40.5 billion AetnaHumana Inc. $37.0 billion Celgene CorporationReceptos, Inc. $7.2 billion Centene CorporationHealth Net, Inc. $6.8... Read More »

New PE Players in the Behavioral Health Market

by | Aug 3, 2015 8:38 am | Behavioral Health Care

The behavioral health care market just a little more competitive, as Odyssey Behavioral Healthcare and Community Intervention Services each announced acquisitions last week. Odyssey Behavioral was formed in May as a partnership between Nautic Partners LLC and Odyssey’s now-CEO, Scott Kardenetz, a 25-year veteran of the BHC industry. Their first acquisitions are Pasadena Villa Psychiatric Residential Treatment Centers in Sevierville, Tennessee and Orlando, Florida, and Lifeskills South Florida, in Deerfield Beach. Community Intervention Services, a portfolio company of H.I.G. Growth Partners, acquired Futures Behavior Therapy Center, LLC in Beverly, Massachusetts, adding to its own... Read More »

Competition Continues for Anesthesiology Groups

by | Aug 3, 2015 8:37 am | Physician Medical Groups

Only three acquisitions of physician medical groups (PMG) were made public in July, but all three targeted anesthesiology practices. MEDNAX (NYSE: MD) announced two deals, one for Manassas Anesthesiology Associates in Virginia, and the other for Lakeshore Anesthesia Services, PC in Muskegon, Michigan.  Sherdian, a subsidiary of AmSurg Corp. (NASDAQ: AMSG), acquired Coastal Anesthesiology Associates, PA in St. Augustine, Florida. These three transactions bring the total number of anesthesiology deals to 11, or 23% of the 47 PMG transactions we’ve recorded in this sector so far in 2015. Read More »

Health Care Insurer Mergers: Who Got the Best Deal?

by | Jul 27, 2015 6:31 pm | Managed Care

You’ve heard the prices, now here are the multiples. After hours of teasing about a definitive agreement, Anthem, Inc. (NYSE: ANTM) finally reached an agreement to acquire Cigna Corp. (NYSE: CI) for $54.2 billion. That works out to 1.5x price/revenue and 13.9x price/EBITDA. The deal followed Aetna’s (NYSE: AET) $37 billion acquisition of Humana Inc. (NYSE: HUM), which gives us a multiple of 0.7x price/revenue and 13.7x price/EBITDA. Cigna is more “administrative services only” versus “full risk” insurance. ASO is lower revenue, but higher margin business than is full risk, which helps explain the P/R difference between the two deals. The much smaller combo... Read More »

Physician Medical Group M&A Is Going Strong

by | Jul 27, 2015 6:25 pm | Physician Medical Groups

Nearly seven full months through the year, M&A in the Physician Medical Group (PMG) sector is on pace to post its second-highest deal volume since 2000. As of July 24, we’ve recorded 47 acquisitions, which is second only to 2011, when 56 transactions were announced in the same time period. The biggest deal in the second quarter of 2015 was MEDNAX’s (NYSE: MD) $500 million acquisition of Virtual Radiologic Corporation(aka vRad). That works out to 2.7x price/revenue, 20.0x price/EBITDA—and a whopping $1.4 million per radiologist. Keep ‘em coming. Read More »

Almost Family Buys into In-Home Assessments

by | Jul 27, 2015 6:22 pm | Home Health & Hospice

Almost Family, Inc. (NASDAQ: AFAM) made a strategic acquisition last week that moves it into the growing health assessment market. The company paid $13,354,200 ($2 million in cash and approximately 260,000 shares of AFAM common stock) to buy Ingenios Health Co. of Jacksonville, Florida. Ingenios provides technology-enabled in-home clinical assessments for Medicare Advantage, Managed Medicaid and Commercial Exchange lives in seven states and Washington, D.C. Last year it performed more than 10,000 in-home assessment visits, which works out to $1,335 per visit, for Almost Family.     Read More »