Home Health and Hospice M&A Activity Jumps in Q1: 2016, According to Acquisition Data from Irving Levin Associates, Inc.

FOR IMMEDIATE RELEASE

Lisa Phillips
Editor
800-248-1668
203-846-6800
Fax: 203-846-8300
pressreleases@levinassociates.com

NORWALK, CT – May 10, 2016 – After a relatively slow year in 2015, the home health and hospice M&A market picked up the pace in the first quarter of 2016. There were 18 publicly announced transactions in the first quarter, representing a 50% increase over the fourth quarter of 2015 and a smaller 6% increase over the year-ago quarter. The dollars spent on home health and hospice mergers and acquisitions where the price was disclosed also increased, jumping 69% from the fourth quarter of 2015 to $183.5 million and increasing by a smaller 32% from the year-ago quarter.  Most transactions are small and many do not have disclosed prices, which makes comparing the periods difficult.
 
The largest transaction with a disclosed price in the first quarter of 2016 was the purchase of Genesis Healthcare’s home health business for $84 million by Compassus, a private Tennessee-based company. This was followed by acquisitions of $37 million by Almost Family, $28 million by Amedysis, and $18 million by Kindred Healthcare. Kindred announced three separate home health and hospice acquisitions in the quarter. “Post-acute providers continue to seek home health and hospice businesses to round out their networks in local markets, and the large, publicly traded home health and hospice providers remain active in the market,” stated Lisa Phillips, Editor of the Health Care M&A Report.  
 
All quarterly results are published in The Health Care M&A Report for all 13 sectors of health care, which is part of the Health Care M&A Information Source.  For information, or to order the report, call 800-248-1668.  Irving Levin Associates, Inc. was established in 1948 and has headquarters in Norwalk, Connecticut. The company publishes research reports and newsletters, and maintains databases on the healthcare and senior housing markets.  

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Health Care M&A Deal Volume and Value Exploded in 2015

IMMEDIATE RELEASE  
Lisa E. Phillips, Editor
 800-248-1668
 203-846-6800
 Fax: 203-846-8300
 pressreleases@levinassociates.com

 
NORWALK, CT – January 27, 2016 – Health care merger and acquisition activity grew by 14% in 2015, to 1,498 transactions, setting a new record for health care M&A deal volume. In 2014, which held the previous record, 1,318 deals were announced across 13 health care sectors. Spending in 2015 reached $563.1 billion, another new record. That total represents a 45% increase over the $387.7 billion spent in all of 2014, according to Health Care M&A News. 
                        The Health Care M&A Market – Deal Volume by Sector

 

2015

2014

Change,

Sector
Services

Deals

Deals

Y-o-Y

Behavioral Health Care

38

24

58%

Home Health & Hospice

47

70

-33%

Hospitals

102

99

3%

Laboratories, MRI & Dialysis

52

33

58%

Long-Term Care

356

302

18%

Managed Care

45

22

105%

Physician Medical Groups

88

60

47%

Rehabilitation

30

19

58%

Other

177

136

30%

     Services subtotal

935

765

22%

Technology

 

 

 

Biotechnology

158

136

16%

eHealth

123

118

4%

Medical Devices

113

111

2%

Pharmaceuticals

169

188

-10%

      Technology subtotal

563

553

2%

Grand Total

1,498

1,318

14%

Source: Health Care M&A News, January 2016

 
Health care services made up 62% of 2015’s deal volume, due to increased investor interest in post-acute health care sectors such as Long-Term Care and Rehabilitation. The Behavioral Health Care sector also gained more attention. Physician medical groups, both primary care and specialty physicians, were back in the limelight, as hospitals and health systems moved closer to a value-based reimbursement system.
The health care technology sectors were dominated once again by deal volume and spending in the Pharmaceutical sector, even though deal volume declined 10% in 2015. Spending in the Pharma sector was $297.4 billion, thanks in large part to the $160 billion pending acquisition of Allergan plc by Pfizer Inc., announced in the fourth quarter of 2015.
“Health care mergers and acquisitions benefited from a perfect storm of low interest rates and the building effects of the Affordable Care Act,” said Lisa E. Phillips, editor of Health Care M&A News. “Three years into the ACA, more consumers have health insurance and the shift to bundled payments is under way. Health care providers, health insurers and pharmaceutical companies are all looking for greater scale and cost efficiencies. We’ll see if 2016 can deliver the same level of growth.”
“The fourth quarter of 2015 helped those full-year results,” Phillips noted. Although deal volume declined about 10%, to 370 transactions, compared with the third quarter’s 409 transactions, Q3:15 was a record-breaker. Deal volume was also higher than Q4:14, up 4%. Spending in Q4:15 grew 1%, to $202 billion, compared with $199.5 billion in the third quarter, and was 46% higher than the same quarter in 2014, which posted $138.5 billion.
For more information on The Health Care M&A Information Source or Health Care M&A News, or for a membership to any of Irving Levin Associates’ services, please call 800-248-1668. Irving Levin Associates, Inc., established in 1948, is headquartered in Norwalk, Connecticut and is online at www.levinassociates.com.  This privately held corporation publishes annual and quarterly research reports, monthly and weekly newsletters, and maintains merger and acquisition databases on the health care and senior housing markets. If you would like to receive future releases, please email pressreleases@levinassociates.com.

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Health Care M&A Deal Volume and Value Both Set New Records in Q3: 2015, According to Health Care M&A News

IMMEDIATE RELEASE  
Lisa E. Phillips, Editor
 800-248-1668
 203-846-6800
 Fax: 203-846-8300
 pressreleases@levinassociates.com

NORWALK, CT – October 27, 2015 – Health care merger and acquisition activity increased by 18% in the third quarter of 2015, compared with the second quarter of the year. Deal volume in the third quarter rose to 385 transactions, from 327 in the previous quarter. The 385 deals marked the highest number of transactions in any previous third quarter. Combined spending in the third quarter hit $198.3 billion, a new record for all previous quarters, third or otherwise. The total represents a 265% increase over the second quarter’s $54.3 billion, and an increase of 214% compared with the same quarter in 2014 ($63.2 billion), according to Health Care M&A News. 
                        The Health Care M&A Market – Deal Volume by Sector

 

Q3:15

Q2:15

 

Q3:14

 

Sector
Services

Deals

Deals

%
Changed

Deals

%
Changed

Behavioral Health Care

10

6

67%

4

150%

Home Health & Hospice

9

6

50%

15

-40%

Hospitals

33

24

38%

19

74%

Laboratories, MRI & Dialysis

16

15

7%

8

100%

Long-Term Care

90

65

38%

85

6%

Managed Care

12

8

50%

5

140%

Physician Medical Groups

15

22

-32%

14

7%

Rehabilitation

7

6

17%

5

40%

Other

46

40

15%

36

28%

     Services subtotal

238

192

24%

191

25%

Technology

 

 

 

 

 

Biotechnology

41

34

21%

27

52%

eHealth

33

34

-3%

34

-3%

Medical Devices

31

29

7%

26

19%

Pharmaceuticals

42

38

11%

67

-37%

      Technology subtotal

147

135

9%

154

-5%

Grand Total

385

327

18%

345

12%

Source: Health Care M&A News, October 2015

 
Health care services represented 62% of the third quarter’s transactions, slightly higher than the previous quarter (57%), as well as the same quarter in 2014 (55%). Still, the 238 deals represented a 24% increase over the previous quarter (192 deals). Only one of the sectors, Physician Medical Groups, posted a decline in transaction volume, while Behavioral Health Care managed a 67% gain over the previous quarter.
On the technology side, transaction volume was strong in the Biotechnology and Pharmaceutical sectors, up 21% and 11%, respectively, over the previous quarter. Compared with the same quarter in 2014, Biotech transactions were up 52%, while Pharmaceuticals were off 37%.
“Transaction volume in the third quarter erased all doubt that M&A in the health care industry is slowing,” said Lisa E. Phillips, editor of Health Care M&A News. “The massive spending is largely the result of two deals in the Managed Care sector—the Aetna/Humana and Anthem/Cigna acquisitions—which contributed a combined $91 billion to the quarter’s total. Subtracting those two deals from the total still leaves approximately $107 billion. While that amount isn’t a record for health care M&A spending in a quarter, it’s a strong sum nonetheless.”
For more information on The Health Care M&A Information Source or Health Care M&A News, or for a membership to any of Irving Levin Associates’ services, please call 800-248-1668. Irving Levin Associates, Inc., established in 1948, is headquartered in Norwalk, Connecticut and is online at www.levinassociates.com.  This privately held corporation publishes annual and quarterly research reports, monthly and weekly newsletters, and maintains merger and acquisition databases on the health care and senior housing markets. If you would like to receive future releases, please email pressreleases@levinassociates.com.

Click here to get more information on any of our Publications.

 

 

Health Care M&A Deal Volume and Value Both Slowed in Q2: 2015, According to Health Care M&A News

IMMEDIATE RELEASE  
Lisa E. Phillips, Editor
 800-248-1668
 203-846-6800
 Fax: 203-846-8300
 pressreleases@levinassociates.com

NORWALK, CT – July 28, 2015 – Health care merger and acquisition activity dropped by 13% in the second quarter of 2015, compared with the first quarter of the year. Deal volume in the second quarter slipped to 315 transactions, from 361 in the previous quarter. The combined spending total in the second quarter was just $54.2 billion, a decrease of 49% compared with the $106.1 billion spent in the previous quarter, according to Health Care M&A News.

                        The Health Care M&A Market – Deal Volume by Sector

 

Q2:15

Q1:15

 

Q2:14

 

Sector
Services

Deals

Deals

%
Changed

Deals

%
Changed

Behavioral Health Care

5

8

38%

7

-29%

Home Health & Hospice

5

16

-69%

16

-69%

Hospitals

23

23

0%

24

-4%

Laboratories, MRI & Dialysis

11

4

175%

7

57%

Long-Term Care

64

70

-9%

62

3%

Managed Care

7

10

-30%

8

-13%

Physician Medical Groups

22

22

0%

16

38%

Rehabilitation

6

8

-25%

6

0%

Other

38

48

-21%

33

15%

     Services subtotal

181

202

-13

179

1%

Technology

 

 

 

 

 

Biotechnology

34

60

-43%

35

-3%

eHealth

33

26

27%

30

10%

Medical Devices

29

23

26%

31

-6%

Pharmaceuticals

38

43

-12%

50

-24%

      Technology subtotal

134

152

-12%

146

-8%

Grand Total

315

361

-13%

325

-3%

Source: The Health Care M&A Report, July 2015

Health care services represented 57% of the second quarter’s transactions, roughly equal to the previous quarter (58%), but higher than the same quarter in 2014 (55%). Still, the 181 deals represented a 13% decline compared with the previous quarter (209 deals). Six of the nine services sectors posted a decrease in deal volume and two remained unchanged. Only the Laboratories, MRI & Dialysis sector showed a gain deal-making activity.

On the technology side, transaction volume slowed in the Biotechnology and Pharmaceutical sectors, down 43% and 12%, respectively, over the previous quarter, and off 3% and 24%, respectively, compared with the second quarter in 2014.

“The first quarter of 2015 really benefited from the M&A momentum that started in the fourth quarter of 2014. That slowed in the second quarter, but any quarter with more than 300 deals announced is still a good showing,” said Lisa E. Phillips, editor of Health Care M&A News. “With King v. Burwell decided, we’re seeing a strong pickup in health care M&A in the third quarter. In fact, July dollar volume has already surpassed $157 billion, which should put the third quarter at a new record. We’ll have to wait and see if the Federal Reserve raises interest rates in September, which could slow down deal volume again.”

For more information on The Health Care M&A Information Source or Health Care M&A News, or for a membership to any of Irving Levin Associates’ services, please call 800-248-1668. Irving Levin Associates, Inc., established in 1948, is headquartered in Norwalk, Connecticut and is online at www.levinassociates.com.  This privately held corporation publishes annual and quarterly research reports, monthly and weekly newsletters, and maintains merger and acquisition databases on the health care and senior housing markets. If you would like to receive future releases, please email pressreleases@levinassociates.com.

Click here to get more information on any of our Publications.

 

 

Health Care Deal News, July 20, 2015 — Hospital M&A Held Steady in Q2:15

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Week ending July 17, 2015:

Recent Healthcare M&A Deals

Hospitals

Acquirer

Target

Price

Barnabas Health

Robert Wood Johnson Health System

Merger

Yale New Haven Health System

L+M Healthcare

Merger

Laboratories, MRI & Dialysis

Alere Inc.

US Diagnostics

$60 million

Rehabilitation

Phoenix Rehabilitation and Health Services, Inc.

Advanced Center for Physical Therapy

N/A

Celgene Continues Its Buying Spree

Celgene Corporation (NASDAQ: CELG) made yet another major acquisition last week, picking up Receptos, Inc. (NASDAQ: RCPT) for $7.2 billion. The acquisition significantly boosts Celgene’s Inflammation and Immunology portfolio with the addition of Receptos’ lead product candidate, Ozanimod, which is in Phase 3 tests to treat immune-inflammatory indications in irritable bowel syndrome and relapsing multiple sclerosis. This is Celgene’s biggest deal in 2015, out of the six it has announced. So far, the drug maker has splurged nearly $8.8 billion on acquisitions, collaborations with other drug makers and licensing deals.

Q2:15 Hospital M&A Stayed Active

Hospital mergers and acquisitions didn’t flag in the second quarter of 2015, with at least 23 “definitive agreements” signed. That’s equal to the 23 recorded in the first quarter of the year. (We wait until hospital transactions get that far in the process, because so many fall apart after they sign a letter of intent.) Ventas Inc.’s (NYSE: VTR) $1.75 billion acquisition of Ardent Health Services was the biggest deal of the quarter, followed by Ventas’ expected spin-off of Ardent’s hospital operations to Equity Group Investments, LLC for $475 million. Watch for The Health Care M&A Report, Second Quarter 2015 to be published next week.

Top Five Hospital Deals in Q2:15

Acquirer

Target

Price

Ventas, Inc.

Ardent Health Services

$1.75 billion

Equity Group Investments, LLC

Ardent’s hospital operations

$475 million

LifePoint Health

Watertown Regional Medical Center

$100 million

Adventist Health

Lodi Health

$100 million

Spectrum Health

Pennock Health Services

$56 million

Source: The Health Care M&A Information Source, July 17, 2015

Long-Term Care Deals Still Piling Up

Last week, eight more acquisitions were announced in the Long-Term Care sector, bringing the total to 22 transactions for July, so far. That’s a stronger pace than we’ve seen in recent months. The deal total for the seven deals that disclosed prices was just $220 million, about one-half of the $456 million spent on LTC acquisitions in July. In the second quarter of 2015, there were 64 publicly announced acquisitions in the seniors housing and care market, compared with 62 transactions in the year-ago quarter and 70 transactions in the first quarter of 2015. For second quarter activity, the 64 deals represent a record and implies we may be in for another strong second half of the year, much like in 2014. For the first half of the year, transaction volume is up 5.5% over the first half of 2014.

Molina Healthcare Steps Up Its Game

The big buzz in the Managed Care sector is the $37 billion bid from Aetna (NYSE: AET) for Humana Inc. (NYSE: HUM), of course. While that deal is lauded for the Medicare assets it brings to Aetna, Molina Healthcare (NYSE: MOH) continues to beef up on Medicaid assets. Last week it announced two deals, one for the Medicaid assets of MyCare Chicago covering approximately 61,000 enrollees in Cook County, Illinois. The other was for Preferred Medical Plan’s Medicaid assets, serving approximately 25,000 enrollees. These deals come on the heels of its acquisition in May of HealthPlus of Michigan’s MIChild contract, with around 6,000 patients, and the Medicaid contract of HealthPlus Partners, numbering around 90,000 Medicaid patients…………………………..Click here for a free trial to The Health Care M&A Information Source and download the current issue today.

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