Global corporate healthcare mergers and acquisitions activity reached a record high in 2017, rising 27 percent to $332 billion from the year prior, according to a Bain & Co. report released April 18.
"The industry is at a major inflection point, and as a result, we're seeing category leaders consolidate and the silos between sectors starting to blur," said Dale Stafford, a partner at Bain & Co. and leader of the company's Americas M&A practice. "While total corporate deal value in healthcare hasn't quite equaled its 2015 peak, average annual activity over the past four years has been strong, nearly twice the level of the previous four years. This activity is profoundly reshaping the industry."
Here are six insights from Bain's seventh annual "Global Healthcare Private Equity and Corporate M&A Report."
1. Global corporate healthcare M&A rose to $332 billion in 2017, nearing record-high levels last seen in 2014 and 2015.
2. Three "megamergers," collectively valued at $126 billion, accounted for more than one-third of the total $332 billion value.
3. Healthcare private equity total disclosed deal value rose to $42.6 billion, up 17 percent from 2016.
4. The total number of global M&A deals rose from 206 deals in 2016 to 265 transactions in 2017.
5. Ten of the largest healthcare M&A deals accounted for nearly 60 percent of the $42.6 billion total disclosed deal value. Among the highest grossing deals of 2017 was Humana, Welsh, Carson, Anderson & Stowe and TPG Global's acquisition of Louisville, Ky.-based Kindred Healthcare.
6. According to Bain, the five forces disrupting healthcare are:
- The "Amazon effect"
- Digital revolution
- Regulatory change
- Consumerism
- Personalized medicine
To access the full report, click here.