A report from Hampleton Partners has highlighted the health tech sector has seen record valuations in the first half of 2019.
The first half of 2019 recorded an increase in healthtech M&A activity, with 100 deals closed (11 per cent more than in 2H 2018) and around $8.3 billion in disclosed transaction value throughout the period, reveals Hampleton Partners in its latest global Healthtech M&A Market Report
Jonathan Simnett, director and healthtech specialist, Hampleton Partners, said “M&A activity in the healthtech sector underlines a pressing imperative: to deliver better healthcare, cheaper, against the backdrop of an ageing population, data protection and the pressures of cost-efficiency. As a result, many acquisitions have targeted companies focused on preventative medicine software and technology which can help detect anomalies early and avoid later-stage, costly emergency treatments; and software aiding efficient personnel, equipment and facilities allocation and accurate payment processing.”
In 1H 2019, 38 per cent of acquisitions were made by financial buyers – a proportion consistent with the share seen in previous reporting periods, which have swayed between 29 and 42 per cent.
Several of these financial buyers made acquisitions with a preference for medical records and healthcare data management software; clinical management and analysis SaaS; and online health services.
The healthtech sector saw a record number of fundraises and value raised in 1H 2019. The amount invested in healthcare companies globally reached $26.9 billion, compared to $26.5 billion in 1H 2018. Deal count also increased to 2,258, compared to 2,223 in 1H 2018.
The report highlights key trends in health tech acquisitions including:
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Tracking, monitoring and patient engagement solutions are attracting attention, as preventative medicine is prioritised to avoid costly later-stage interventions
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Practice management, clinical analytics and billing software still popular, particularly in North America
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Private equity and financial buyers continue to invest and acquire
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Patient satisfaction closely monitored through qualitative and quantitative surveys, as the long-term patient relationship takes centre stage
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Credential-checking and reference software and databases increasingly popular
Jonathan Simnett concluded “We expect healthtech to remain a strong sector with continued M&A activity in the near future, as financial and strategic buyers invest and acquire in order to enter the healthtech space, expand their own product range or simply to seize the opportunity of innovative healthtech solutions which are likely to appeal to a wide range of healthcare systems and providers.”
