June 30, 2017 – Solganick & Co. has issued its latest M&A update for the Healthcare IT / HealthTech industry. You can download the full report here: Solganick Healthcare IT M&A Update, Q1 2017
Solganick & Co.'s Q1 2017 Healthcare IT M&A Update reported strong M&A volumes with over 50 transactions, indicating a robust market. Key acquisitions included McKesson's $1.1 billion purchase of CoverMyMeds and Swedish PE EQT's $2.3 billion acquisition of patient survey giant Press Ganey. Nearly half of the $1 billion invested in digital health during the quarter focused on analytics, big data, and care coordination, demonstrating a shift towards patient engagement solutions over traditional EHR M&A. This strong M&A activity is expected to continue, driven by healthcare's ongoing digital transformation into patient-centric, connected care.
The following is a summary of the report highlights:
- M&A volumes remain strong with over 50 transactions recorded in Q1 2017. McKesson’s $1.1b billion acquisition of CoverMyMeds is expected to form the basis of a joint venture which will merge and eventually go IPO.
- Other acquisitions in the quarter span the full diversity of Health Tech solutions from clinical trials software through patient engagement solutions to precision medicine, demonstrating the opportunity for innovative offerings across the healthcare value chain.
- Nearly half of the $1 billion invested in digital health are namely in, analytics and big data, care coordination, telemedicine, hospital administration, healthcare consumer engagement, and wearables and biosensing.
- M&A activity in this sector is expected to remain healthy while fundraising appetite will also stay strong.
- On the deal side, emphasizing the importance of connecting with patients, more money was spent on patient engagement solutions than on typical EHR M&A, including EMMI, acquired by Wolter Kluwer for $175M, and HealthiestYou, acquired by TelaDoc for $155M. The largest check came from Swedish PE EQT, acquiring patient survey giant Press Ganey for $2.3B. And while Fitbit struggled in the public market, Apple’s new Carekit offering and Nokia’s acquisition of Withings indicate significant opportunities for truly connected health via wearables, mobile and more.
- M&A will continue to be at the core of healthcare’s digital transformation into patient-centric, connected care. The flood of healthcare M&A that we predicted last year has pressed into 2017 and shows no signs of slowing down. This hot market will pay big dividends to those that are active in the M&A game.
- Despite the threat of healthcare policy overhaul in the U.S. and lingering uncertainty as to the shape of the sector going forward, U.S. and European HealthTech stocks performed strongly in Q1 2017 with Veeva (+26.0%) and Medidata (+16.1%) continuing to drive outstanding performance in BioPharma IT.
- M&A volumes remain strong with over 50 transactions recorded this quarter, one of which may hint at an IPO in the near future. Other acquisitions in the quarter span the full diversity of HealthTech solutions, from clinical trials software (Genstar’s acquisitions of eCOA provider Bracket) through patient engagement solutions (Philips’ acquisition of a minority stake in pregnancy lifestyle tracking application, OneLife) to precision medicine (Hospital Corporation of America’s acquisition of Genospace) demonstrating the opportunity for innovative offerings across the healthcare value chain.
Solganick & Co. covers the Healthcare IT / HealthTech marketplace and provides M&A advisory and investment banking to fast growing and established companies. For more information you can contact them directly here: mergers @ solganick.com
Full Report: Solganick Healthcare IT M&A Update, Q1 2017