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Week ending March 20, 2015:
Recent Health Care M&A Deals
Acquirer
Target
Price
Pharmaceuticals
Ignyta, Inc.
4 oncology development programs
$13.3 million
Eli Lilly and Company
License to HM71224
$50 million
Daiichi Sankyo Co.
License to Movantik™
$200 million
Other Services
Magellan Health, Inc.
4D Pharmacy Management Systems, Inc.
$55 million
ARX Equity Partners
Diagnosticni Center Bled doo
N/A
2 private equity firms
Life Time Fitness, Inc.
$4 billion
UPMC Acquires Local Hospice Provider
The University of Pittsburgh Medical Center (UPMC) has been busy this year, with two acquisitions and a “significant investment,” after 18 months off the M&A circuit. This month’s acquisition was Family Hospice and Palliative Care, also in Pittsburgh. The company is the state’s largest not-for-profit medical services provider for people with terminal illness. UPMC also made an undisclosed investment in Health Fidelity, a Palo Alto-based technology company with a “risk adjustment solution” that was deployed by UPMC Health Plan last year. UPMC’s previous acquisition was Jameson Health System in New Castle, Pennsylvania, announced in February.
Back to Smaller Hospital Deals
Our annual 2015 Health Care Services Acquisition Report is getting ready to go to press, and we thought we’d share a bit of data on hospital transactions in recent years. Between 2008 and 2011, an average of 1.4 facilities were involved in each hospital deal. In 2012 and 2013, however, larger systems came into play, and the average number of facilities per transaction grew to 2.3 in 2012 and 3.4 in 2013. Despite the stronger market for hospitals last year, the average number of facilities per deal dropped to 1.8. The report will be available in early April, brimming with data on average price-per-bed, revenue-per-deal, and a look at M&A trends in nine service sectors. Reserve your copy today!
Hospital Transactions, by Number of Facilities, 2010 to 2014
Year
Total # of Hospital Deals
# of Hospitals
2014
100
178
2013
88
296
2012
107
244
2011
90
156
2010
72
125
Source: The Health Care M&A Information Source, March 20, 2015
Another PBM Changes Hands
Early this month we wrote about the pick-up in M&A activity around pharmacy benefits management (PBM) companies, particularly as private equity firms made exits. Last week, another PBM made M&A news, as Magellan Health (NASDAQ: MGLN) paid $55 million to acquire 4D Pharmacy Management Systems in Troy, Michigan. 4D Pharmacy has strong presence in the growing markets of Medicare, dual eligible and healthcare exchanges. Plus, Magellan expects 4D to produce approximately $400 million in revenue in 2015, pre- and post-acquisition.
Janssen Scoops Up XO1
No, XO1 is not a drug candidate, it’s the name of an asset-centric virtual biopharmaceutical company, XO1 Limited, a UK-based portfolio company of Index Ventures. Janssen Pharmaceuticals (NYSE: JNJ) paid an undisclosed price for the virtual company, which was founded solely to develop the anti-thrombin antibody ichorcumab, which basically acts as an anticoagulant but doesn’t cause bleeding, like previous blood thinners. XO1 and Index Ventures licensed the technology from Cambridge University Hospitals, where it was developed………………….Click here for a free trial to The Health Care M&A Information Source and download the current issue today.
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