HEALTH & LIFE SCIENCES NEWS
HEALTH & LIFE SCIENCES NEWS
Exploring Critical Business and Legal Issues across the Healthcare and Life Sciences Industries
HEALTH & LIFE SCIENCES NEWS
Exploring Critical Business and Legal Issues across the Healthcare and Life Sciences Industries
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What Impact has Coronavirus had on Doing Healthcare Deals?

In the fifth and final installment of McDermott’s HPE Europe 2020 Summer Webinar Series, McDermott partner Tom Whelan hosted a discussion with Marc Benatar of Apax Partners, Markus Peterseim of Alvarez & Marsal, and fellow McDermott partner Dr. Nikolaus von Jacobs to examine how the Coronavirus (COVID-19) pandemic is affecting deal making in the healthcare industry. Whelan led the group through a wide-ranging conversation centered on five key pandemic deal impact areas: pricing, process, timing, regulation and future prospects. Read on for discussion highlights, and click here to access the full webinar. Pricing “You’ve clearly seen a polarization,” Benatar said. “Nonessential businesses were hit hard by the lockdown effect and remain impacted, while those that were related to essential elements of healthcare were hit but started to experience a catch-up at the beginning of May and are already getting close to the normal run rate volume. I think that...

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Top Takeaways: New Steps for Compliance: A Closer Look at the DOJ’s Revised Corporate Compliance Program

The US Department of Justice’s (DOJ) revised compliance program document “The Evaluation of Corporate Compliance Programs,” released June 1, 2020, helps organizations understand how DOJ evaluates compliance programs for effectiveness. Below are the the top takeaways from this revision that you should be aware of. For a deeper dive into this revision, listen to our webinar recording. Three questions the DOJ looks to answer are: Is the corporation’s program well designed? Is the program being applied earnestly and in good faith? (In other words, is the program adequately resourced and empowered to function effectively?) Does the corporation’s program work in practice? Under the June 2020 updates, the DOJ will increase its focus on evaluating how effectively compliance programs are tailored to the organization’s risk profile, including the company’s size, industry, geographic footprint, regulatory landscape and other factors. Compliance programs should...

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Tips for Conducting Effective Due Diligence in an Auction Process

In today’s highly competitive healthcare environment, investors may find themselves in an auction process where they must conduct due diligence pre-exclusivity. With limited time and mounting pressure, it can be difficult to know what issues to prioritize. Here are some practical tips for focusing your due diligence efforts strategically in a pre-exclusivity setting: Quality of Earnings: Against the backdrop of high valuations, quality of earnings should be a key diligence focus, particularly in the context of high-complexity transactions  such as corporate carve-outs, partnerships with corporates and public-private pairings. For example, it is critical to examine the pro forma EBITDA to see if it excludes costs or includes questionable adjustments or add-backs. Timeline: How competitive is the auction process and when are bids due? Does the buyer plan to conduct a full due diligence review pre-exclusivity, or instead look for big ticket liabilities that have...

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Proactive Due Diligence Considerations for Life Sciences Dealmakers

In today’s competitive and fast-paced life sciences dealmaking environment, buyers and investors are often unable to spend as much time on due diligence as they might like. Market players are often highly focused on the science itself and, as a result, may pay less attention to issues such as supply chain, intellectual property components and reimbursement. However, addressing these topics at the due diligence stage is critical—they can cause a deal to unravel if left unexamined, regardless of the strength of the science. Due diligence standards and considerations vary significantly across life sciences subsectors— pharma, medical devices, digital health and AI are each governed by unique regulatory structures and operate in very different deal landscapes. Buyers and investors are well advised to consider end-game issues such as reimbursement options, protection for valuable IP and pathways to commercialization early in the planning process. Framing the areas...

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Collaborative Transformation: Life Sciences Partnerships – Delivering Deals that Work

The life sciences marketplace has been ripe for collaboration for the past decade, but new players, new technologies and new regulations are changing the space. Traditional life sciences companies are working together in new and exciting ways, bringing a variety of deal structures and new complexities into the landscape. Our Collaborative Transformation podcast episode "Driving the Deal: Life Sciences Partnership Opportunities, Pitfalls and Impact" with Emmanuelle Trombe and Gary Howes explores these issues in depth. Below are key takeaways from the episode, which you can listen to in full here. It's not just new players changing the space—it’s new approaches by traditional players. "It's not only about pharma and biotech," Trombe said. "We are seeing collaboration with health care players such as payers, insurers and providers." Technology companies are also entering the space, bringing financial and philanthropic investments to the table. "People are still...

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Five Questions with a Health Lawyer: Megan Rooney

Megan Rooney Partner Office: Chicago Years at Firm: 13 What is your favorite part about practicing health care law at McDermott?  The team, the team, the team! It’s a pleasure to work with colleagues who have deep substantive expertise, prioritize client service, and are good human beings. As a healthcare M&A attorney, I am responsible for leading large teams of attorneys, including a variety of subspecialists, to drive efficient and effective outcomes and achieve business goals. I love knowing that, in nearly every instance, when an issue arises we have the specific expertise to handle it and there is no need to reinvent the wheel. What is the biggest opportunity facing clients in your area of focus today?  Our hospital and health system clients have a tremendous opportunity to improve the delivery of patient care, expand services provided to their communities and defend against the challenge of declining reimbursement through strategic partnerships. In...

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Five Questions with a Health Lawyer: Amanda Enyeart

Amanda Enyeart Partner Office: Chicago Years at Firm: 4 What is your favorite part about practicing health care law at McDermott?  Definitely our people. I love the depth and breadth of expertise among my colleagues. We have highly experienced lawyers in just about every health care niche you can think of and this allows us to take on client work with confidence. On top of that, we have lawyers who are gifted strategists who can take a holistic and critical look at an issue from a broad perspective. I am constantly learning from my colleagues. What is the biggest opportunity and greatest challenge facing clients in your area of focus today?  Our clients have the potential to transform health care delivery and improve quality of care.  We see forces aligning such as changes in payment models to reward value rather than volume and the integration of advanced technology in health care settings to support health care diagnosis and decision making that could...

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Dealmaking in Life Sciences – Valuations and Partnerships that Work

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....

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