Announced deal value for healthcare private equity in 2019 came in at a record-breaking $78.9 billion. Nirad Jain, who coleads Bain’s Global Healthcare Private Equity and Corporate M&A practices, discusses key findings from Bain's ninth annual Healthcare Private Equity & Corporate M&A Report, including the increased use of advanced analytics, developments in technology and changes in investor attitude.
Read the transcript below:
NIRAD JAIN: Bain & Company just published our ninth annual Healthcare Private Equity and Corporate M&A report, and it shows that healthcare PE investing had a blowout year in 2019, setting an all-time record of $79 billion of announced deal value. That was driven by a 58% increase in North American deal value, but also increases in Europe.
Investors flocked to healthcare in the face of increased macroeconomic uncertainty, but also because of the trends underlying healthcare demand, including demand for more healthcare services around the globe, an aging population and continued technology advancement in the sector.
As we've talked about previously, healthcare is one of the best returning verticals within private equity and particularly in times of macroeconomic uncertainty. So PE investors became increasingly bold on their activity in the healthcare sector, with a 25% increase in average deal value and an unprecedented 27 deals over $1 billion in value.
In our report, we talk about the explosion in healthcare IT investing, the increased use of data and advanced analytics in the sector, and how investors are thinking about regulatory changes, as well as the upcoming US election. Read about those topics, as well as what we think is in store for 2020 and beyond, in our report.
Investors remain eager to pour funds into healthcare, given strong underlying demand and the industry’s resilience at any stage of the economic cycle. Our annual report looks at recent trends and the outlook for healthcare investing.