Managed Care Mega-Deals Not Too Big to Fail

by | Jul 19, 2016 7:46 pm | Managed Care

2015 is about to lose even more of its M&A luster, it seems. Some $91 billion is about to disappear from the record-setting spending on healthcare M&A, thanks to the potential unraveling of two managed care mega-mergers. Bloomberg is reporting that the U.S. Department of Justice plans to file lawsuits seeking to halt the mergers of Aetna (NYSE: AET) and Humana (NYSE: HUM) for $37 billion, and Anthem (NYSE: ANTM) with Cigna (NYSE: CI), for $54.2 billion. For healthcare M&A wonks, 2015 set new records in deal volume, with more than 1,500 deals, and deal value, at $397 billion. The dollar total would have been even higher, at $564 billion, if Pfizer (NYSE: PFE) hadn’t walked... Read More »

Managed Care M&A in 2016

by | Jan 8, 2016 9:18 pm | Managed Care

The Managed Care sector woke up in 2015 with a spate of mega deals announced in July, following the positive SCOTUS decision in King v. Burwell in late June. While Anthem (NYSE: ANTM) and Aetna (NYSE: AET) got the most press for their multi-billion bids for Cigna (NYSE: CI) and Humana (NYSE: HUM), respectively, others were making serial acquisitions. Molina Healthcare (NYSE: MOH) led the sector with eight deals in 2015. All its targets were Medicaid business carve-outs from larger entities, stretching from Washington state to Illinois, Michigan and Florida. Centene Corp. (NYSE: CNC), which also focuses on under-served and uninsured populations, made news with its $6.8 billion acquisition... 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 »

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 »