The current environment for healthcare transactions is fiercely competitive with high prices, tough deal terms and limited time for proper due diligence. In terms of both value and number of deals, 2018 was the biggest year for health care private equity (PE) since the financial crisis. More large cap PE firms are moving into the small and mid-cap space, increasing competition. At the same time, non-health-care entrants are competing with US and international PE, especially in the area of physician practice management and other related health care services.

Faced with this stiff competition, sponsors are getting more creative in their healthcare partnerships, whether that means partnering with management teams on new strategies, partnering with large strategics or even with one another.  These innovative collaborations can open up more investable opportunities, including public to privates and secondary trades among sponsors.

Even with these creative new opportunities, submitting a winning bid for a health care services business in a hotly contested auction can be a Herculean task. When outbidding the competition is not an option, here are some tips to help differentiate your offer:


Continue Reading

Pharmaceutical outsourcing has emerged as a robust—and rapidly growing—subsector of the life sciences industry. As the push for efficiency continues, more pharmaceutical, biotech and medtech companies are turning to contract research organizations (CROs), contract development organizations, medical affairs outsourcing and other service providers for help bringing products to market, manufacturing and distributing products, and improving

We greatly appreciate our readers continuing to turn to us for insight on the most critical legal, regulatory and transactional developments, and innovative collaborations transforming health care. Over the past year, McDermott’s Health practice made headlines for our work on several of the most high-profile collaborative transformations that took place in 2018: We were one

Technology companies are pouring unprecedented capital, time and energy into the health care and life sciences industry, and are reshaping the deal landscape in the process. The top 10 US tech companies have made $4.7 billion in acquisitions in the health care space since 2012, according to CB Insights. Key market factors driving health care joint ventures and mergers and acquisitions include the merger of molecular science and computer technology, a growing focus on patient-centric care, increased mobility of consumer health products and services, and deep capital markets. In this fast-paced, proactive deals environment, traditional health players have exciting—and disruptive—new opportunities to enter into unexpected partnerships and pursue transformative innovation.

With Great Disruption Comes Great Opportunity

A helpful analogy for understanding the role of tech companies in this rapidly evolving sector is Uber’s disruption of the ride-hailing industry. When Uber came on the scene, on-demand ride-hailing was only available through taxicabs, and frequently only available in major cities. Now on-demand ride hailing is available through numerous companies and in areas that previously did not have such services available. Ride-hailing companies have also expanded their services offering to include food delivery.

Tech companies entering the health industry today are doing the same thing: reimagining and redefining the fundamentals of consumer access to health care. These companies often have deep insight into distribution and consumer purchasing behavior, and are willing to invest more capital and take on more risk than traditional health industry players in order to explore and develop creative health care offerings. Furthermore, the solutions they are developing don’t just offer incremental improvements—creating a more expensive service or drug option doesn’t cut it. Instead, they want to create dramatic solutions that make health care better overall. Tech companies in the health care space are pursuing innovation that carries value in context of the entire health ecosystem.
Continue Reading

The PPM industry is by no means immune to the ebbs and flows of a traditional marketplace. Since the consolidation bubble burst in the 1990s, PPMs have gone from practically extinct to a once-again substantial component of the health care delivery system. But with greater influence comes more pressure to respond, and adapting to today’s

The health care field is evolving at light speed, adapting to changing patient, physician and payer expectations. This is particularly evident in the physician practice management (PPM) and ambulatory surgery center (ASC) industries. We gathered recently in Nashville, Tennessee for the 2018 Physician Practice Management & ASC Symposium to explore and discuss these changes –

Physician practice management (PPM) and ambulatory surgery center (ASC) companies continue to attract tremendous attention of private equity investors and continue to play a key and growing role in the healthcare services sector.

In advance of our 2018 Physician Practice Management & ASC Symposium, I wanted to get a better sense of where the

There are many critical issues facing the physician practice management (PPM) and ambulatory surgery center (ASC) industries today, including the effects of sky-high valuations, concerns about sustainability, and the importance of delivering on value. This current environment demands new approaches to PPM structures — one that is focused on alignment and designed to enable growth.

Below are five key market issues to be addressed at the 2018 Physician Practice Management & ASC Symposium in Nashville, TN on April 25-26, where industry leaders will come together to discuss trends in the current landscape and the myriad business, transactional and regulatory issues that exist today, including:
Continue Reading