Bain & Company released the Global Healthcare Private Equity and Corporate M&A Report 2019, outlining mergers and acquisitions in several areas of healthcare, including medtech.
Five key trends:
1. In 2018, medtech experienced 67 merger and acquisition deals, totaling $10.5 billion. Last year's deals were up significantly from 2017, when there were 51 deals totaling $6.5 billion. The deal volume in Europe drove overall volume growth in 2018.
2. There were five deals in 2018 that totaled more than $1 billion, compared with one similar deal in 2017. Deals in North America and Asia-Pacific were responsible for the increase in value over the past year.
3. Prices are increasing in part due to competition from buyout firms and corporate acquirers. Three deals last year that were public-to-private transactions were in the top 10 deals worldwide.
4. Headwinds in the industry, like pricing pressure from providers and provider consolidation, present challenges in the field, and in some cases force medtech to lower general and administrative spending and inventory, according to the report.
5. Private equity will look for investment opportunities in medtech as the companies "hone their product development and manufacturing," such as Nordic Capital's 2019 investment in Orchid Orthopedic Solutions. "We expect to see a continued push into services as firms look for attractive consolidation opportunities," states the report.