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.”
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