Healthcare M&A on Steroids: 2021 and Beyond
Healthcare merger and acquisition activity in 2021 has been more robust than anticipated, with over 3,000 total transactions expected by year-end. That represents an increase of more than 25% as compared to 2020. The heightened level of investor interest and mergers in the healthcare sector will likely continue through 2022 and beyond. This phenomenon has largely been driven by three key factors.
First, and most notably, the COVID-19 pandemic has demonstrated and solidified the importance of the healthcare industry to our nation. Furthermore, the recession-proof nature of the healthcare sector and many of its subsectors such as pharmaceuticals, medical device, healthcare IT, and healthcare providers. As a result, trillions of dollars of investor capital are anxiously seeking to be invested in this industry with skyrocketing growth. The industry refers to the available capital as “dry powder.”
Second, the economic and strategic benefits of consolidation are staggering This is especially true within provider sectors such as hospitals, physician services, home health, behavioral health, and cannabis. By joining larger organizations, these providers are able to more effectively succeed in an increasingly competitive industry, due to their highly professionalized corporate infrastructure. Such experienced executive team and sophisticated business support systems allows them to adapt and respond to changes in the marketplace, new regulations, and the growth of value-based payment programs. Larger organizations also tend to have greater access to capital for expansion in services, locations, medical staff, EMR systems, data analytics, and other strategic capabilities.
Third, many providers are motivated to transact as a result of potentially imminent increases in tax rates for long-term capital gains. Therefore, entrepreneurial, and closely held private healthcare care companies are attempting to monetize the value of their businesses at a time when valuations are high, and the tax consequences are lower.
Key Takeaways for Attendees
- Overview of the super-robust 2021 healthcare M&A activity, and predictions for 2022
- Key factors driving the growth of investment and M&A activity in the healthcare industry
- The pros and cons of partnerships with private equity investors
- How to prepare your company for a strategic transaction, and overview of the transaction process
About Our Speakers
Gary Herschman is a healthcare M&A attorney and partner at Epstein, Becker & Green. Gary has been advising healthcare providers and business on mergers, acquisitions, and other strategic transactions for over 25 years, and is known throughout the country as a top leader in healthcare consolidation deals.
Gary writes articles and is quoted on this topic in many national publications (including Bloomberg Health, Crains, Beckers, Fierce Healthcare and others), and is a frequent speaker at healthcare industry conferences across the country. In particular, he advises hospitals, healthcare systems, physician groups, long-term care companies, ASCs, and healthcare technology companies on their most important and strategic transactions.
Dana Jacoby, CEO, Vector Medical Group, is recognized as a difference maker and trusted advisor to health system executives, medical practices, vendors, and other stakeholders in optimizing patient care while also elevating financial and operational performance.
Dana’s passion for operational excellence has driven a distinguished record of achievement at the intersection of market data, measurement and analytics, strategy design and implementation, and technology innovation. She is a published author and engages audiences as a keynote speaker, educator, and subject matter expert at medical forums, summits, and conferences. Dana has played a pivotal role in leading transformation throughout the highly regulated and value-centric healthcare industry.